In this interview, Dr. Amel Barich, Founder & CEO of Geoscience Research and Communications (GRC) , shares insights into the future of geothermal energy, covering superhot geothermal systems, advanced drilling, international collaboration, social license to operate, developing-country opportunities, and the growing role of geothermal in integrated energy systems. Image : Dr. Amel Barich Founder & CEO, Geoscience Research and Communications (GRC) Geoscientist | Geothermal R&D&I | Social License to Operate Q1. Could you briefly introduce yourself and describe your current role in advancing geothermal innovation? I am a geoscientist and geothermal professional with a background spanning geothermal research and innovation, international collaboration, policy and science diplomacy, stakeholder engagement, and strategic communication. Over the past decade, I have worked from Iceland across major European and international geothermal initiatives, leading collaborative R...
Global Geothermal Investment Outlook 2026–2035: High‑Growth Markets, Financing Trends, Risks and Opportunities for Private Renewable Energy Investors and Developers
Global Geothermal Investment Outlook 2026–2035
Geothermal energy is entering a high‑growth decade, shifting from niche technology to a strategic pillar of the global clean‑energy transition between 2026 and 2035. Capital expenditure on geothermal is expected to rise strongly—around 20% annually through 2030—before consolidating at higher absolute levels as more markets mature and policies stabilize.
Why Geothermal Is Heating Up
Several converging drivers explain why geothermal is becoming central to investment strategies. Governments and utilities are grappling with the challenge of integrating large shares of wind and solar while preserving grid stability and energy security; geothermal’s firm, 24/7 output makes it a valuable complement to variable renewables. At the same time, rising carbon prices, climate targets, and air‑quality concerns are pushing industries and cities to decarbonize heat, where geothermal is often more competitive than fully electrified alternatives.
Another major catalyst is technology. Advances in drilling, reservoir imaging, and enhanced geothermal systems (EGS) are opening new resource types beyond classic volcanic regions, particularly in large sedimentary basins in the United States and other countries. The U.S. Department of Energy’s “Enhanced Geothermal Shot” aims to reduce the cost of EGS by up to 90% by 2035, with cost estimates already dropping by nearly half in recent field demonstrations. This innovation narrative strengthens the investment case by promising lower costs and higher productivity over the coming decade.
Geographic Hotspots and Emerging Markets
Traditional geothermal leaders will continue to attract substantial investment, but the geography of capital flows will broaden significantly between 2026 and 2035. Mature hubs such as Southeast Asia (Indonesia, Philippines), the United States, and parts of Europe already account for a large share of capacity, yet the momentum is clearly spreading.
East Africa stands out as one of the most dynamic emerging regions. Kenya has built a strong track record with large fields like Olkaria, and it is now joined by neighbors such as Ethiopia and Tanzania, where Rift Valley resources are being mapped and early projects structured with multilateral support. For a Nairobi‑based investor or developer, this regional clustering is particularly important: it creates opportunities not only in domestic projects but also in cross‑border services, equipment supply, and joint ventures across the wider African Rift corridor.
Latin America’s Andean region—Chile, Peru, and Argentina—is another emerging frontier, where geothermal can deliver reliable power and process heat to mining districts and industrial clusters. These countries are increasingly looking to diversify away from fossil fuels and address grid stability concerns, setting the stage for policy frameworks that support geothermal deployment. In parallel, smaller markets such as Bolivia and Ecuador may see pilot developments that pave the way for later scaling after 2030.
Europe’s geothermal story is increasingly centered on heat rather than only power. Deep geothermal district‑heating networks are being planned and expanded in Germany, France, the Netherlands and other EU member states, driven by high gas‑price volatility, energy‑security concerns and stringent climate policies. In dense urban areas, deep geothermal can serve as the backbone of low‑carbon heat systems, supplying residential, commercial and industrial consumers with reliable, decarbonized warmth.
Asia‑Pacific adds a diverse set of opportunities. Japan is reviving interest in geothermal power and combined heat and power (CHP) as it continues to rebalance its post‑Fukushima energy mix. Indonesia and the Philippines will remain core markets, with large pipelines of conventional high‑temperature projects that benefit from longstanding experience and supportive policy signals. At the same time, countries like Australia and China are increasingly examining EGS and deep geothermal for both power and district heating, leveraging robust drilling and engineering industries.
Financing Trends: How Capital Will Flow
The financing landscape for geothermal between 2026 and 2035 will reflect both its high upfront resource risk and its attractive long‑term cash‑flow profile once a project is proven. Global spending on geothermal is projected to increase at roughly 20% per year through 2030, with around half of CAPEX going to surface facilities, about 47% to drilling and subsurface work, and a small share to exploration—though that small share carries outsized risk.
One major trend is the rise of blended finance and public–private risk‑mitigation instruments. Development finance institutions and governments are expanding their use of drilling‑risk insurance, resource confirmation grants, and concessional loans aimed at the exploration and early development stages. These mechanisms help crowd in private capital by buffering the most uncertain phase of geothermal projects. Results‑based financing, where payouts occur when projects achieve specified capacity or availability milestones, will increasingly feature in emerging‑market structures.
Green bonds and sustainability‑linked loans are another important channel. As institutional investors seek ESG‑aligned assets, utilities and developers can issue green bonds earmarked for geothermal projects, using robust reporting frameworks to demonstrate decarbonization impact. Sustainability‑linked loans, with interest‑rate step‑downs tied to emissions or renewable‑share targets, create additional financial incentives to deploy geothermal rather than fossil alternatives.
Traditional project finance remains central, built on long‑term power‑purchase agreements (PPAs) or heat‑supply contracts with creditworthy off‑takers. For power projects, PPAs with utilities or large industrial customers underpin non‑recourse debt structures. In Europe’s district‑heating markets, long‑term contracts with municipalities or network operators play a similar role, offering stable, inflation‑linked revenue streams to investors.In mature markets, pension funds and infrastructure funds will likely take larger equity stakes, attracted by long asset lifetimes and predictable cash flows.
A particularly dynamic area is technology‑driven investment. EGS and other next‑generation geothermal technologies—such as advanced drilling methods, improved reservoir stimulation, and modular binary plants—are drawing capital from venture and growth‑equity investors. These investors often view geothermal technology as adjacent to oil‑and‑gas and shale‑gas expertise, leveraging existing drilling and subsurface know‑how while pivoting toward low‑carbon outcomes.
Risk Analysis: Understanding the Geothermal Risk Profile
Despite its promise, geothermal carries a distinctive risk profile that investors must address systematically. The most fundamental risk is subsurface uncertainty. Exploration drilling may reveal lower‑than‑expected temperatures, permeability, or flow rates, compromising project economics. Even once a resource is confirmed, poor reservoir management—particularly reinjection strategies—can lead to pressure declines or induced seismicity, affecting long‑term performance and community perceptions.
Policy and regulatory risks are prominent, especially in emerging markets. Changes in feed‑in tariffs, renewable‑energy incentives, or licensing regimes can alter project returns mid‑stream. In some countries, permitting processes are slow or fragmented, and subsurface rights are not clearly defined, leading to delays and higher financing costs.
Mitigating these risks requires careful country selection, continuous regulatory monitoring, and strong local partnerships.
Market and offtaker risks are also significant. In certain emerging economies, the creditworthiness of utilities is a concern, complicating the bankability of PPAs. Where power markets lack mechanisms to value capacity or firmness, geothermal may be disadvantaged relative to lower‑cost variable renewables, even though it provides superior reliability. Over time, however, rising recognition of geothermal as a strategic asset for energy security and system balancing is likely to improve its market treatment.
Environmental and social risks must be managed proactively. Community concerns about land use, micro‑seismicity, or visual impact can delay or derail projects if stakeholder engagement is weak. Robust environmental impact assessments, transparent communication, and benefit‑sharing mechanisms are essential components of risk mitigation. On the technology side, next‑generation geothermal solutions—particularly EGS—still carry performance uncertainty at scale, making careful pilot design and phased roll‑out important to avoid costly missteps.
Estimated Market Value: 2026–2035
Market‑research data provide useful reference points for estimating geothermal’s value potential over the coming decade. One global report projects the geothermal energy market to reach around USD 13.56 billion by 2030, up from an estimated USD 9.81 billion in 2025, implying a compound annual growth rate of roughly 5.3%. This estimate covers power generation and heating and cooling applications, driven by rising renewable‑power demand, adoption of ground‑source heat pumps, and supportive policies.
Other analyses, including those focused on the 2026–2036 period, highlight that geothermal is shifting from a niche option to a strategic grid asset, with investment expected to grow about 20% annually through 2030 before stabilizing.
Taken together, these data points suggest that global geothermal capital expenditure across power and heat could reach several tens of billions of dollars over 2026–2035, especially if next‑generation technologies succeed in expanding the economically viable resource base.
Context from adjacent markets reinforces this outlook. Industrial heat pumps and technical insulation, which often complement or reduce demand for fossil‑based heat, are forecast to grow strongly toward 2035. The steam‑turbine market, relevant for flash and dry‑steam geothermal plants, is projected to reach around USD 22.18 billion by 2035, indicating sustained demand for baseload generation equipment. These trends show that industrial and power markets are steadily valuing efficient, reliable, low‑carbon heat and power solutions, in which geothermal plays a structural role.
Opportunities for Private Investors and Developers
For private investors and developers, the coming decade offers opportunities across the full project lifecycle—from exploration and greenfield development to brownfield optimization and technology platforms. One of the most attractive segments is brownfield expansion and repowering in mature markets. Upgrading turbines, adding binary cycles to utilize lower‑temperature fluids, and optimizing reservoir management in existing steam fields can yield robust returns with lower resource risk. Such projects benefit from established infrastructure and known performance histories, reducing uncertainties compared with pure greenfield developments.
Industrial and district‑heating projects offer another promising avenue. In Europe and parts of Asia, deep geothermal heat networks are being deployed to decarbonize municipal and industrial heat supply. Developers who can structure bankable long‑term heat‑purchase agreements with cities, utilities, and industrial clusters will tap into stable, often inflation‑linked revenue. These projects can be particularly attractive for infrastructure funds and pension investors seeking long‑duration, predictable income streams.
Frontier markets, especially in East Africa and the Andean region, lend themselves to portfolio strategies. Instead of betting on a single asset, investors can acquire a portfolio of licenses across several prospects, diversifying subsurface risk. Co‑investing with multilateral development banks can further de‑risk exposure by providing political‑risk coverage, concessional finance, and technical assistance. , building regional partnerships and service capabilities—drilling, reservoir modeling, and project management—could allow them to participate across multiple national markets as geothermal activity expands.
Technology and service plays are a distinct opportunity class. Investments in drilling services companies, subsurface imaging and reservoir‑simulation platforms, and modular binary‑plant manufacturers can capture value across multiple projects and geographies.EGS and other next‑generation technologies are particularly attractive to venture and growth‑equity funds, which can back platforms that scale across different basins and countries. These plays benefit from tailwinds in broader industrial‑automation and energy‑efficiency markets.
Finally, integrated energy‑transition solutions hold significant promise. Geothermal can be combined with industrial heat pumps, technical insulation, and advanced energy‑management systems to deliver comprehensive decarbonization packages to industrial clients and cities. Developers who position themselves as integrated solution providers, rather than single‑technology vendors, can secure premium margins and longer‑term client relationships, particularly in sectors where reliability and cost stability are crucial.
Strategic Takeaways for 2026–2035
Looking ahead, several strategic themes stand out for investors and developers seeking to build durable geothermal portfolios. Focusing on markets where geothermal is explicitly embedded in national energy strategies—such as the United States, key EU countries, Indonesia and Chile—will improve policy stability and project bankability. Building multidisciplinary teams that combine geoscience, drilling engineering, project finance and community engagement will be essential to manage the complex risk profile of geothermal assets.
Aligning investment theses with broader industrial and energy‑efficiency trends strengthens the business case. Growth in industrial heat, heat‑pump deployment and technical insulation all point to a rising premium on efficient, low‑carbon heat and power, positioning geothermal as a core solution rather than a peripheral technology. Above all, investors need to adopt a long‑term perspective: geothermal rewards patience, with significant upfront risk but the potential for decades of stable, inflation‑linked cash flows once projects succeed.
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