Heating up: Geothermal investment set for 20% annual rise through 2030 - Rystad Energy
Heating up: Geothermal investment set for 20% annual rise through 2030 - Rystad Energy
Published November 29, 2025
Geothermal Investment Projected to Increase by 20% Annually Through 2030
According to a recent report from Rystad Energy, investments in geothermal energy are expected to rise significantly over the next decade. The analysis indicates that capital expenditures in the geothermal sector will experience an annual increase of 20% through the year 2030. This growth trajectory is attributed to the rising demand for renewable energy sources and the global transition towards sustainable energy solutions.
The report highlights that the total investment in geothermal energy is anticipated to reach $25 billion by the end of the decade. This figure represents a substantial increase from the current investment levels, reflecting a growing recognition of geothermal energy's potential as a reliable and consistent energy source.
Global Geothermal Market Overview
Geothermal energy, harnessed from the Earth's heat, has long been recognized for its potential to provide stable and renewable energy. Unlike solar and wind energy, which can be intermittent, geothermal energy offers a continuous power supply, making it an attractive option for many countries seeking to diversify their energy portfolios.
As of now, the global geothermal power capacity stands at approximately 15 gigawatts (GW). The report forecasts that this capacity will expand significantly, driven by increasing investments and advancements in technology. Rystad Energy estimates that the global geothermal power capacity could reach 30 GW by 2030, doubling the current figures.
Regional Insights and Investment Trends
The report identifies several key regions that are poised to lead the geothermal investment surge. The United States remains a frontrunner, with a well-established geothermal infrastructure and ongoing projects that are expected to contribute to the overall growth in capacity. California, in particular, continues to be a hotspot for geothermal energy, hosting some of the largest geothermal plants in the world.
In addition to the United States, countries such as Indonesia and the Philippines are also making significant strides in geothermal development. Indonesia, which possesses the largest geothermal reserves globally, is projected to see its geothermal capacity grow in line with government initiatives aimed at increasing the share of renewable energy in the national energy mix.
The Philippines, with its rich geothermal resources, is expected to maintain its position as one of the top producers of geothermal energy. The country has been actively investing in geothermal projects, which are crucial for meeting its energy demands and reducing reliance on fossil fuels.
Technological Advancements Driving Growth
Technological innovation plays a critical role in the expansion of geothermal energy. Recent advancements in drilling techniques and exploration methods have made it easier and more cost-effective to tap into geothermal resources. Enhanced geothermal systems (EGS) are also gaining traction, enabling the utilization of geothermal energy in areas previously considered unsuitable for traditional geothermal power generation.
Rystad Energy's report emphasizes that these technological improvements are not only lowering the costs associated with geothermal projects but are also increasing the efficiency and output of existing geothermal plants. As a result, investors are becoming more confident in the viability of geothermal energy as a long-term investment.
Challenges and Considerations
Despite the promising outlook for geothermal energy investments, several challenges remain. One of the primary obstacles is the high upfront capital required for geothermal projects, which can deter potential investors. Additionally, the exploration phase can be risky, as not all geothermal sites yield economically viable resources.
Regulatory frameworks and permitting processes can also pose challenges, varying significantly from one country to another. Streamlining these processes may encourage more investment in geothermal projects and facilitate the rapid deployment of new technologies.
Conclusion
The geothermal energy sector is on the brink of significant growth, with investments projected to rise by 20% annually through 2030. With total investments expected to reach $25 billion and global capacity potentially doubling, the future of geothermal energy looks promising. Key regions such as the United States, Indonesia, and the Philippines are leading the charge, supported by technological advancements and a growing recognition of geothermal energy's reliability.
As the world continues to pivot towards renewable energy sources, geothermal energy stands out as a sustainable and consistent option. Addressing the challenges associated with investment and development will be crucial in realizing the potential of geothermal energy in the global energy landscape.
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