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Geothermal energy provides stable, low-carbon power and is drawing greater attention as global energy systems transition. (Photo: INPEX)
The geothermal energy sector is gaining fresh momentum in Asia, as Google recently signed its first geothermal power purchase agreement (PPA) in the region—with Taiwan—marking a major milestone for the region’s clean energy transition. Meanwhile, the Trump administration, long skeptical of renewable energy, has surprised the market by backing geothermal projects, including an executive order to fast-track project permitting.
Despite historically high development costs, recent advances in technology and growing public-private collaboration are bending the cost curve. This article analyzes the shifting economics and technological innovations that are redefining geothermal’s role in the global energy mix.
Geothermal gains ground as Google and Trump fuel expansion
In mid-April, Google announced it had signed its first geothermal PPA in the Asia-Pacific with Baseload Power Taiwan. The deal aims to add 10 MW of low-carbon electricity to Taiwan’s grid by 2029, supporting the company’s local data centers and operations. If successful, it could double Taiwan’s currently operational geothermal capacity.
Outside Taiwan, Google has been actively exploring geothermal energy in Australia and collaborating with U.S. startup Fervo Energy to develop Enhanced Geothermal Systems (EGS)—a next-generation technology designed to unlock heat resources in previously inaccessible locations. Google is also working with nonprofit Project InnerSpace to collect and analyze subsurface data globally, with Japan and Indonesia flagged as future focus areas.
Geothermal power is attracting not only tech companies but also political backing from the U.S. government. Despite President Donald Trump’s historical aversion to renewable energy, his administration has carved out space for geothermal development—possibly because of its technical overlap with fossil fuel operations.
Under the Trump administration’s declared “national energy emergency,” the U.S. Department of the Interior has streamlined permitting for certain energy and critical mineral projects. Environmental reviews that previously took two years can now be completed in under 28 days. While the priority list mostly features fossil fuels, geothermal energy, biomass, and kinetic hydropower are also included—making geothermal a notable outlier.
Beyond regulatory support, the sector has gained traction from bipartisan political support and public endorsements from Energy Secretary Chris Wright. However, geothermal remains a capital-intensive industry. High upfront costs continue to pose a significant barrier to broader deployment.
Geothermal rivals gas in cost, powers low-carbon AI infrastructure
According to Lazard’s 2024 Levelized Cost of Energy+ (LCOE+) analysis—which evaluates the full cost of power generation including construction, fuel, and maintenance—geothermal power costs range between USD 64 and 106 per MWh. This is significantly cheaper than natural gas and on par with coal at the lower end. When factoring in carbon pricing, geothermal stands out as a climate-friendly and economically viable alternative.
While geothermal may not yet match solar or wind in cost, it offers a key advantage—reliability. Unlike intermittent renewables, geothermal can provide round-the-clock baseload power. This is especially critical as AI drives electricity demand from data centers, requiring consistent and low-carbon supply.
The International Energy Agency (IEA) projects that next-generation geothermal could cut costs by up to 80% by 2035, reaching as low as USD 50 per MWh. At that price, it would become one of the cheapest dispatchable low-carbon energy sources—rivaling hydro, nuclear, and biomass while competing directly with wind and solar.
Oil and gas tech spurs new era of deep geothermal
Enhanced Geothermal Systems (EGS), a cornerstone of next-generation geothermal, aim to reduce development costs and geographic limitations. These systems borrow heavily from the oil and gas industry’s drilling methods, including horizontal drilling and hydraulic fracturing.
MIT spin-off Quaise Energy is pushing the envelope with plans to drill up to 20 km deep—tapping into rock temperatures of 500°C. Such depths could unlock heat output up to 10 times greater than traditional geothermal wells.
Tim Latimer, CEO and founder of U.S.-based geothermal startup Fervo Energy, believes recent innovations will unlock deeper geothermal reserves at competitive costs. The company’s integration of horizontal drilling and fiber-optic monitoring has earned it a spot on Time magazine’s “World’s Top Greentech Companies 2025” list.
This technology is now being deployed at Fervo’s Cape Station project in Utah, which is under construction and expected to deliver 2 GW of capacity by 2028—potentially making it the largest EGS facility ever built.
Next-gen geothermal technologies include enhanced and closed-loop systems. (Source: IEA)
Corporate demand and policy support are key to scaling geothermal
According to Global Information Inc. (GII), the global market for EGS is expected to reach USD 3.53 billion by 2033, growing at a compound annual growth rate (CAGR) of 4.41%. Analysts attribute this growth to three factors: rising renewable energy demand, innovation in drilling technology, and heightened focus on energy security.
Compared to mature technologies like wind and solar, geothermal is still in its early stages. Its development depends on strong government policy frameworks and sustained private investment.
As Michael Terrell, Google’s Senior Director of Energy and Climate, notes, corporate demand plays a pivotal role in geothermal commercialization. Through long-term PPAs and equity investments, companies like Google are laying the groundwork for a new era of low-carbon geothermal power.
Sources: DOI, Cipher, Feovo Energy, E&E News
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