Geothermal Power and Heat

Geothermal energy ⁱ can be harnessed for various direct heat applications as well as for electricity generation. Electricity and space heating are the largest applications, followed by recreation (swimming and bathing facilities), agriculture and food processing, and industrial process heat. ¹ In some markets, such as Iceland, geothermal energy is used extensively across all these areas, while in other markets its use is concentrated in specific sectors. For example, in the Netherlands, geothermal energy use is mostly limited to greenhouse horticulture.

Geothermal electricity generation totalled an estimated 99 terawatt-hours (TWh) in 2024 (See Box 1), a 1.7% increase over 2023, and represented approximately 1% of all renewable electricity generation. ² Direct use thermal energy supply, which accounts for approximately 3% of all renewable heat supply, totalled an estimated 245 TWh (882 petajoules, PJ), an estimated 19.5% increase over 2023, due largely to policy-driven expansion in China. ³

While geothermal energy is theoretically ubiquitous, its use is limited by technical and economical constraints to the boundaries of the Earth's lithospheric plates, where high heat is found relatively close to the surface. Over the five-year period 2019-2024, the geothermal energy industry made only very limited gains, adding net 1 gigawatt (GW) of capacity, primarily in the harnessing of high-temperature hydrothermal resources, which are of quite limited geographical reach. ⁴ Direct use of geothermal energy (heat) has grown faster over the same period, but is also marked by relatively small scale and by constraints of geology.

Recent technological advances and improving economics of energy extraction suggest that geothermal energy extraction may become viable in a wider range of geographies. ⁵ The combination of binary-cycle energy conversion technology and advanced energy extraction technology (combination of advanced drilling and hydraulic fracturing) has the potential to make geothermal energy, for the first time, a significant variable in the global energy mix. ⁶

In 2024, a handful of technology companies, concentrated in North America, pursued next-generation geothermal energy projects against a backdrop of improving economics but also regulatory uncertainty. ⁷ By mid-2025, policymakers in the United States, where much of the relevant research and technology development has occurred, appeared ready to spare the geothermal sector the most adverse policy changes affecting other renewable energy technologies, even though recent government data and research on this topic had been purged from official sources by early 2025. ⁸

Box 1. Means of Generating Electricity from Geothermal Sources

There are two primary approaches to generating electricity from geothermal resources. One is to use geothermal steam directly to drive turbines (either dry or flash steam). In high-enthalpy applications (combination of ample temperature and water), the geothermal fluid gradually boils to steam as it ascends the wellbore and enters the power plant ahead of the steam turbine. This transformation (flashing) can occur more than once, depending on steam conditions, as the steam is separated from high-pressure stream to low-pressure stream, to drive cascading turbine stages for maximum energy extraction and efficiency.

The other approach is indirect use of geothermal heat and steam through binary-cycle technology. Most plants built in recent years have been binary-cycle plants, where the geothermal fluid heats and vaporises a separate working fluid with a lower boiling point than water, which in turn drives a turbine to generate electricity. Each fluid cycle is closed, and the geothermal fluid is re-injected into the heat reservoir. The binary cycle allows an effective and efficient extraction of heat for power generation from relatively low-temperature geothermal fluids. Organic Rankine Cycle (ORC) binary geothermal plants use an organic working fluid, and the Kalina Cycle uses a non-organic working fluid.

While conventional hydrothermal systems rely on sufficient heat, permeability and fluid to deliver energy to the surface, enhanced geothermal systems (EGS) can be implemented where fluid and permeability are lacking. In an EGS, fluid is injected into the hot rock at great pressure. This hydraulic fracturing creates fissures in the bedrock that allow fluid pathways to form, creating the conditions for an induced hydrothermal cycle.

GEOTHERMAL POWER

At least 28 countries used geothermal energy to generate electricity in 2024. ⁹ The top 10 countries for geothermal power capacity ⁱⁱ at the end of 2024 remained the United States, Indonesia, the Philippines, Türkiye, New Zealand, Mexico, Kenya, Italy, Iceland and Japan. ¹⁰

At least 400 megawatts (MW) ⁱⁱⁱ of new geothermal power capacity was added in 2024, bringing the global total to around 15.1 GW. ¹¹ This was the largest annual increase since 2019 and a third more than the 2018-2023 five-year average, which was just 300 MW due to market slow-downs in Türkiye and Indonesia. ¹² Six countries added new capacity in 2024 (in descending order): New Zealand, the Philippines, Türkiye, Indonesia, the United States and Japan. ¹³ (See Figure G-1)

New Zealand represented more than half of geothermal power additions in 2024 and is making significant progress in reducing CO₂ emissions from the sector.

New Zealand completed two geothermal power installations in 2024 (one triple-flash design and one binary-cycle unit), expanding capacity by 225 MW, more than half of total global additions. ¹⁴ The unit completed at the Tauhara plant near Taupō is one of the world's largest single unit binary power stations and is designed to reinject all its carbon dioxide (CO₂) emissions back into the geothermal reservoir. ¹⁵ Overall CO₂ emissions from New Zealand's geothermal sector have been declining due to gas-reinjection retrofit schemes at several existing locations. ¹⁶ Geothermal power capacity in New Zealand, nearing 1.3 GW, is well utilised (at a capacity factor of 85% in 2023) and supplied 17.8% of the country's electricity in 2023. ¹⁷

The Philippines ranked second for additions in 2024, adding at least 54 MW of new geothermal power capacity. ¹⁸ Total installed generator capacity (nameplate) neared 2 GW, of which around 1.8 GW was operating capacity and 1.2 GW was available for dispatch at year's end (as in 2023). ¹⁹

Geothermal facilities in the Philippines are dispatched near their level of availability, which has been declining due to limited steam supply at some older facilities. ²⁰ In 2023, geothermal facilities provided around 9% of the country's electricity. ²¹

To mitigate the significant financial risk associated with exploration and development of geothermal resources, in 2024 the Philippine government advanced plans to establish financing facilities to derisk future projects in the country. ²²

FIGURE G-1 Geothermal Power Capacity and Additions, Top 10 Countries and Rest of World, 2024

Following two years of stagnation, Türkiye completed three new units (totalling 42 MW) in 2024, raising installed capacity to 1.7 GW. ²³ In 2023, a revised feed-in tariff (FIT) was approved; the original geothermal FIT, adopted in 2021, had been deemed insufficient given development timeframes, project costs and exploration and development risks. ²⁴ Foreign currency risks have been of concern for project financing and investment, particularly since 2021, when the FIT was set in local currency. ²⁵ To further improve conditions for development, Türkiye's geothermal industry has called for streamlined permitting processes and better risk mitigation facilities. ²⁶

Geothermal power in Türkiye provided 11.2 TWh of electricity in 2024, or 3.2% of supply, compared to 8.9 TWh (3% of supply) in 2019. ²⁷ The average capacity factor of the country's geothermal power assets was about 75%. ²⁸

Indonesia's geothermal power capacity expanded by at least 33 MW, bringing the total to approximately 2.6 GW. ²⁹ During the five-year period 2019-2024, net geothermal capacity in Indonesia grew 24% (an average of 102 MW annually), from 2.1 GW to more than 2.6 GW. ³⁰ Total investment in geothermal activity during 2024 exceeded the government's target, at USD 748 million, and was somewhat higher than the annual average for the preceding three years (USD 626 million). ³¹

The Indonesian government continued efforts to support and accelerate geothermal energy development, eager to develop more of the country's 14.6 GW of proven reserves. ³² These efforts included: streamlining processes such as the licencing for new geothermal working areas, reducing the current project timeframe of 5-6 years; and launching a platform for integrated geothermal survey and exploration data services. ³³ In late 2024, Indonesia announced a successful auction of permits for seven geothermal working areas, totalling an estimated 300 MW of potential capacity. ³⁴

The only geothermal power project completed in the United States during 2024 was the repowering of the Beowawe facility in Nevada. ³⁵ Reported net operable capacity at year's end was 2.7 GW (nameplate generator capacity of 4.0 GW). ³⁶ The five-year growth in net operable capacity for the period 2018-2023 was 10.3%, though annual generation increased by a mere 2.5% (average capacity factor dropped from 74.6% to 69.3%). ³⁷ This decline has been attributed to the gradual deterioration of steam production in older geothermal fields. ³⁸ Estimates ^iv suggest that generation dropped to 15.7 TWh in 2024 from 16.4 TWh in 2023, representing 0.36% of the country's net electricity supply. ³⁹

Japan added three new geothermal power units (additional and replacement) in 2024, with a total capacity of 22.5 MW – one in each of the country's most active geothermal regions. Total installed capacity

(generator nameplate) remained at around 0.5 GW and effective operating capacity at around 0.3 GW. ⁴⁰ The largest unit completed was the 14.9 MW Appi plant in Iwate prefecture, Honshu. From survey to completion, this project took 20 years; construction alone lasted 5 years due to the challenging mountainous environment. ⁴¹ Japan also is pursuing enhanced geothermal system technology (EGS), and developing the means to use supercritical CO₂ instead of water as a heat transfer medium in areas without a mature hydrothermal system. ⁴²

Finally, China completed a small power unit at a co-generation facility in Shaanxi province, with an effective power capacity of at most 80 kW. ⁴³ While China is home to an estimated two-thirds of global geothermal heat supply, its geothermal power generation capacity remains miniscule in comparison, with a total of 16 MW in operation. ⁴⁴

GEOTHERMAL HEAT

Global direct use of geothermal energy ^v – direct extraction of geothermal energy for thermal applications – increased around 20% in 2024, to an estimated 245 TWh (882 PJ). ⁴⁵ The top countries for direct use in 2024 were (in descending order) China, Türkiye, Iceland and Japan. ⁴⁶ (See Figure G-2) Direct use of geothermal energy remained highly concentrated in these four markets (and further localised within each country). ⁴⁷

China continues to be the world's fastest growing market for geothermal heat (predominantly used for space heating), with capacity additions in 2024 somewhat larger than in 2023. Measured in units of floor area of heated dwellings, China's geothermal heating capacity at the end of the 13th five-year planning period (2016-2020) was estimated to be 582 million square meters (m2) and was expected to grow 50% to 873 million m2 by the end of the 14th planning period (2025). ⁴⁸ This rapid growth is the result of strong policy impetus as China strives to reduce air pollution, taking advantage of geothermal resources coinciding with densely populated areas in the east of the country. ⁴⁹

At the start of the 2024-2025 heating season, geothermal heating capacity was reported to have grown more than 17%, serving an additional 120 million m2 of space, up from an increase of 95 million m2 in 2023. ⁵⁰ Based on this increment, the country's geothermal space heating capacity served a total of 808 million m2, which suggests total annual direct use for space heating of 488 PJ ^vi , more than half of the global total. ⁵¹

FIGURE G-2 Geothermal Direct Use, Top 4 Countries and Rest of World, 2024

Only four countries represent an estimated 87% of all direct use of geothermal energy for thermal applications.

In addition to space heating, in 2021 China harnessed 101 PJ of geothermal heat from hot springs for recreational uses and 14 PJ for agriculture, food processing and industrial process heat. ⁵² Assuming no growth for these categories since 2021, a conservative estimate of total geothermal direct use in China in 2024 would be 603 PJ, 43% more than the global total in 2019, a mere five years earlier. ⁵³

Direct use of geothermal energy in Türkiye (for space heating, greenhouse cultivation and recreation) appears to have expanded rapidly in recent years. Following average annual growth of 3.8% for the period 2015-2019, growth accelerated to an annual average of 14% for the three years through 2022, reaching 5.2 GWth. ⁵⁴ Based on the capacity utilisation rate of 2019 and assuming constant growth since, direct use may have reached 106 PJ in 2024, which would be double the output of five years earlier. ⁵⁵

In Iceland, geothermal energy is the dominant source of heat for all thermal applications, meeting 97.4% of heat demand ^vii in 2023 (the most recent data available). ⁵⁶ Geothermal heat consumption grew 10.4% over the period 2018-2023, with a strong uptick in the last year (+3.8%) to 36.3 PJ. ⁵⁷

Based on this five-year growth rate, direct use in 2024 may have surpassed 37 PJ. ⁵⁸ In 2023, the residential sector was the largest consumer (16.7 PJ), followed by commercial and public services (13.8 PJ), fisheries (4.1 PJ), industry (1.2 PJ) and agriculture (0.7 PJ). ⁵⁹

Japan continues to rank fourth for geothermal direct use (mostly by “onsen” bath facilities) despite possible capacity contraction in recent years. ⁶⁰ Adequate data was lacking for 2023, but capacity was estimated at 2.1 GWth (revised downward from the preceding year) with energy use at around 24 PJ (revised from 30 PJ for 2022). ⁶¹

From a small base, direct use of geothermal heat in the Netherlands is growing rapidly, with vast room for further expansion.

In the Netherlands, geothermal heat production increased by 16% in 2024, reaching 7.9 PJ, following two years of 6% growth. ⁶² Much of the growth came from increased utilisation of existing wells, while drilling of new wells for production and resource mapping also continued during 2024. ⁶³ While geothermal heat is well-suited for district heating, its use in the Netherlands is almost exclusively limited to greenhouse horticulture. ⁶⁴ A lengthy and unpredictable permitting process, along with a suboptimal subsidy structure, is said to discourage investment in geothermal for the district heating sector. ⁶⁵