The "Sun Beneath our Feet" – Geothermal power development in Asia Pacific - White & Case
Published December 17, 2025
The "Sun Beneath our Feet" – Geothermal Power Development in Asia Pacific
Geothermal energy, often referred to as the "sun beneath our feet," is gaining traction as a significant renewable energy source in the Asia Pacific region. The potential of geothermal resources is immense, with various countries in the region exploring and developing these resources to meet their growing energy demands and reduce reliance on fossil fuels.
The Asia Pacific region is home to some of the world’s most active geothermal systems, with countries like Indonesia, the Philippines, and New Zealand leading the way in geothermal energy production. This article examines the current state of geothermal power development in the region, the challenges faced, and the opportunities that lie ahead.
Geothermal Resources in the Asia Pacific
Geothermal energy is derived from the heat stored beneath the Earth's surface. The Asia Pacific region possesses significant geothermal resources, with an estimated potential of over 200 gigawatts (GW). Indonesia and the Philippines are the top two countries in terms of installed geothermal capacity, accounting for approximately 40% of the global total.
Indonesia is the world’s largest producer of geothermal energy, with an installed capacity of around 2,100 megawatts (MW). The country aims to increase its geothermal capacity to 7,200 MW by 2025, as outlined in its National Energy Policy. The Philippines follows closely, with an installed capacity of about 1,900 MW and plans to expand its geothermal production to meet its energy needs and reduce greenhouse gas emissions.
New Zealand also has a significant geothermal resource base, contributing approximately 17% of its electricity generation. The country has been harnessing geothermal energy since the early 20th century and continues to invest in the development of this renewable resource.
Challenges in Geothermal Development
Despite the abundant geothermal resources in the Asia Pacific region, several challenges hinder the growth of geothermal energy. One of the primary challenges is the high upfront costs associated with geothermal exploration and development. Drilling wells and conducting feasibility studies require substantial investments, which can be a barrier for many potential developers.
Additionally, the regulatory landscape varies significantly across countries in the region. Inconsistent policies and regulatory frameworks can create uncertainty for investors and developers, making it difficult to secure financing and navigate the permitting process. Countries with well-defined regulations, such as New Zealand, tend to attract more investment in geothermal projects compared to those with less clarity.
Environmental concerns also play a role in geothermal development. While geothermal energy is considered cleaner than fossil fuels, there are still potential environmental impacts associated with drilling and resource extraction. Managing these impacts is crucial to ensuring the sustainability of geothermal projects and gaining public support.
Opportunities for Growth
Despite the challenges, the future of geothermal energy in the Asia Pacific region is promising. Governments are increasingly recognizing the importance of renewable energy in achieving energy security and meeting climate goals. Many countries are implementing policies and incentives to promote geothermal development.
For instance, Indonesia has introduced a feed-in tariff for geothermal energy, providing a guaranteed price for electricity generated from geothermal sources. This policy aims to stimulate investment and accelerate the development of geothermal projects. Similarly, the Philippines has established a Renewable Energy Act that offers various incentives to attract investment in renewable energy, including geothermal.
Technological advancements in geothermal energy extraction and utilization are also creating new opportunities. Enhanced geothermal systems (EGS) and binary cycle power plants are examples of innovations that can improve the efficiency and viability of geothermal projects. These technologies allow for the utilization of lower temperature resources, expanding the potential for geothermal energy production in regions previously considered unsuitable for development.
Regional Collaboration
Collaboration among countries in the Asia Pacific region can further enhance geothermal development. Sharing best practices, knowledge, and technology can help overcome common challenges and accelerate the deployment of geothermal energy. Regional organizations and initiatives, such as the Asia-Pacific Economic Cooperation (APEC) and the Geothermal Energy Association, play a crucial role in fostering collaboration and promoting geothermal energy as a viable renewable resource.
Training and capacity building are also essential components of regional collaboration. Developing a skilled workforce capable of addressing the technical and operational challenges of geothermal projects is vital for the long-term sustainability of the industry. Collaborative training programs and knowledge-sharing platforms can help build the necessary expertise in the region.
Conclusion
The Asia Pacific region holds significant potential for geothermal energy development, with abundant resources and increasing government support. While challenges such as high upfront costs, regulatory uncertainties, and environmental concerns exist, the opportunities for growth are substantial. By fostering collaboration, embracing technological advancements, and implementing supportive policies, countries in the Asia Pacific can harness the "sun beneath our feet" to meet their energy needs sustainably and contribute to global efforts to combat climate change.
As the demand for renewable energy continues to rise, geothermal energy is poised to play a crucial role in the transition to a more sustainable energy landscape in the Asia Pacific region.