Geothermal Power Generation Market Size and Growth 2031

The geothermal power generation market size is projected to reach US$ 27,149.2 million by 2031 from US$ 15,453.3 million in 2023. The market is expected to register a CAGR of 7.3% during 2023–2031. Growing role of geothermal power in future energy transition is likely to remain key trend in the market.

Geothermal Power Generation Market Analysis

Geothermal power generation is a clean, sustainable, and environmentally friendly method that taps into the Earth's internal heat to produce electricity. This process involves harnessing the natural steam or hot water reservoirs found beneath the Earth's surface. Flash steam power plants accounted for 64.6% of the total geothermal power generation market share globally.

Further, the rising demand for electricity from end users, such as residential, commercial, and industrial sectors, is anticipated to fuel the market growth during the forecast period. Industrial users accounted for 45.4% of the total geothermal power generation in the world, owing to the rise in demand for electricity for various industrial applications such as manufacturing, chemical, petrochemical, processing, and others. Asia Pacific accounted for the largest geothermal power generation market share, i.e., about 40.4%, in 2022.

Geothermal Power Generation Market Overview

The geothermal power generation market growth is linked to the geological conditions favorable for tapping into the Earth's internal heat. The Earth's geology influences geothermal power's global distribution, and regions with high volcanic activity, tectonic plate boundaries, or hotspots are more likely to have significant geothermal resources. While some regions have been at the forefront of geothermal development, ongoing advancements in technology, such as enhanced geothermal systems (EGS), are expanding the reach of geothermal power, making it an increasingly viable option for clean and sustainable energy worldwide.

Geothermal power aligns with global energy transition goals, which aim to reduce carbon emissions and increase reliance on renewable energy sources. As countries commit to international agreements like the Paris Agreement, the role of geothermal power becomes more prominent in achieving carbon neutrality. The reliable and low-carbon nature of geothermal energy makes it an integral part of the clean energy transition. Governments worldwide incorporate geothermal power into their energy transition strategies, setting targets for increased renewable energy capacity and reduced reliance on fossil fuels. The global shift toward sustainable energy practices emphasizes the importance of geothermal power in achieving broader environmental and climate goals.

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Geothermal Power Generation Market: Strategic Insights

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Geothermal Power Generation Market Drivers and Opportunities

Low greenhouse gas emissions from geothermal power to Favor Market

The global growth in energy demand, driven by population growth and industrialization, necessitates the expansion of energy production. The expansion of energy production from fossil fuel-based plants has resulted in a rise in greenhouse gas emissions, which, in turn, is expected to increase the need for renewable power generation. Thus, a rise in the demand for reducing greenhouse gas emissions is expected to drive the geothermal power generation market growth from 2023 to 2031.

In addition, geothermal power is characterized by its low greenhouse gas emissions during both construction and operation. Unlike fossil fuel-based power plants, geothermal facilities produce minimal carbon dioxide and other pollutants. The emissions are primarily from the release of gases in small amounts, such as hydrogen sulfide, which are effectively managed and mitigated. The environmental impact of geothermal power is significantly lower than traditional energy sources, making it a cleaner and more sustainable option. As countries strive to reduce their carbon footprint and combat climate change, the low emissions profile of geothermal power positions it as a crucial component in the transition to a greener and more sustainable energy landscape.

Untapped Geothermal Potential in Emerging Economies

Heat flows from the Earth's interior that covers twice the global energy demand. In order to harness this heat, there is a requirement to drill deep underground and convert that heat into a usable form of energy. This is considered a difficult and expensive process; hence, geothermal energy, sometimes referred to as the forgotten renewable energy, only accounts for ~0.3% of global electricity production.  Another main advantage of geothermal energy is that it can provide baseload capacity, which is the minimum amount of electricity that must be available on the grid at any given time. While solar and wind output fluctuates seasonally and throughout the day, geothermal generation can be adjusted in the same way that a fossil fuel power plant can increase or decrease output.

In addition, the government initiatives toward exploring the untapped geothermal potential globally. For instance, to help countries unlock the untapped potential of geothermal energy and promote its widespread use, the International Renewable Energy Agency (IRENA) established the Global Geothermal Alliance (GGA) in 2015 as a platform to improve dialogue, collaboration, and coordinated action to increase the share of geothermal power installed as well as heat generation worldwide. Moreover, Indonesia, Turkey, and Kenya are key economies expected to lead in geothermal electricity generation by the end of 2030. The economic development plan named Kenya Vision 2030 by the Government of Kenya aimed at reaching 5 GW of geothermal capacity by 2030. Thus, exploring the untapped geothermal potential in emerging economies is expected to create several opportunities for the geothermal power generation market growth during the forecast period.

Geothermal Power Generation Market Report Segmentation Analysis

Key segments that contributed to the derivation of the geothermal power generation market analysis are plant type, and end user.

• Based on plant type, the geothermal power generation market is divided into direct dry steam, flash steam, and binary cycle. The flash steam segment held a larger market share in 2023.
• By end user, the market is segmented into residential, commercial, and industrial. The industrial segment held the largest share of the market in 2023.

Geothermal Power Generation Market Share Analysis by Geography

The geographic scope of the geothermal power generation market report is mainly divided into five regions: North America, Asia Pacific, Europe, Middle East & Africa, and South & Central America.

Asia Pacific is leading the market. This is owing to the increasing investments in the geothermal power capacity additions and rise in demand for clean power generation in the coming years. Asia Pacific, particularly countries along the Pacific Ring of Fire, is rich in geothermal resources. The Philippines is a notable example, with a significant share of its electricity coming from geothermal power plants. Indonesia, New Zealand, the Philippines, and Japan also have active geothermal projects and exploration initiatives. Indonesia, New Zealand, and the Philippines accounted for more than 75% of the total global geothermal power generation market size globally in 2022 and are projected to maintain their dominance during the geothermal power generation market forecast period.

Geothermal Power Generation Market Regional Insights

The regional trends and factors influencing the Geothermal Power Generation Market throughout the forecast period have been thoroughly explained by the analysts at Insight Partners. This section also discusses Geothermal Power Generation Market segments and geography across North America, Europe, Asia Pacific, Middle East and Africa, and South and Central America.

Geothermal Power Generation Market Report Scope

Geothermal Power Generation Market Players Density: Understanding Its Impact on Business Dynamics

The Geothermal Power Generation Market market is growing rapidly, driven by increasing end-user demand due to factors such as evolving consumer preferences, technological advancements, and greater awareness of the product's benefits. As demand rises, businesses are expanding their offerings, innovating to meet consumer needs, and capitalizing on emerging trends, which further fuels market growth.

Market players density refers to the distribution of firms or companies operating within a particular market or industry. It indicates how many competitors (market players) are present in a given market space relative to its size or total market value.

Major Companies operating in the Geothermal Power Generation Market are:

1. Northern California Power Agency
2. Turboden SpA
3. Toshiba Energy Systems & Solutions Corp
4. Berkshire Hathaway Inc
5. NIBE Industrier AB
6. General Electric Co.

Disclaimer: The companies listed above are not ranked in any particular order.

Geothermal Power Generation Market News and Recent Developments

The geothermal power generation market is evaluated by gathering qualitative and quantitative data post primary and secondary research, which includes important corporate publications, association data, and databases. A few of the developments in the geothermal power generation market are listed below:

• Fervo Energy breaks ground on the next-generation geothermal plant. This facility is 400 MW in Beaver County, Utah. Fervo Energy will use enhanced geothermal technology to harness heat sources. (Source: Fervo Energy, Press Release, September 2023)
• Exergy International (Provider of clean energy technology) signed an agreement with Energy Development Corporation (EDC) for the supply of a 28 MW binary system plant in Leyte, Eastern Visayas (the Philippines). (Source: Exergy International, Press Release, August 2023)

Geothermal Power Generation Market Report Coverage and Deliverables

The “Geothermal Power Generation Market Size and Forecast (2021–2031)” report provides a detailed analysis of the market covering below areas:

• Geothermal power generation market size and forecast at global, regional, and country levels for all the key market segments covered under the scope
• Geothermal power generation market trends as well as market dynamics such as drivers, restraints, and key opportunities
• Detailed PEST and SWOT analysis
• Geothermal power generation market analysis covering key market trends, global and regional framework, major players, regulations, and recent market developments
• Industry landscape and competition analysis covering market concentration, heat map analysis, prominent players, and recent developments for the geothermal power generation market
• Detailed company profiles