Heat Beneath, Power Ahead!

Fervo, Ormat, and Enel push ahead as US geothermal aims for 100GW by 2050 amid permitting delays and rising costs

4 Aug 2025

US geothermal developers are pushing ahead with next-generation drilling projects despite funding delays and regulatory uncertainty that risk slowing progress in one of the country’s most promising clean energy sectors.

Fervo Energy, a Houston-based start-up, has successfully deployed an Enhanced Geothermal System (EGS) in Nevada, using horizontal drilling to access previously untapped heat resources. Backed by power purchase agreements with Google and private equity investment, the project marks a key technical milestone. But progress has come against the backdrop of stalled federal loan approvals and increased material costs, driven in part by new tariffs on imported steel and equipment.

The Department of Energy’s loan programme, once a crucial source of financing for clean infrastructure, has slowed following staffing reductions and stricter oversight. Although clean energy tax credits from the Inflation Reduction Act remain in place, they have not been sufficient to offset the uncertainty in project timelines and capital access.

Ormat Technologies, one of the US’s most established geothermal firms, has stepped up lobbying efforts in Washington. It is calling for faster permitting processes and clearer loan guidance to reduce bottlenecks. “The tech is proven,” said one company executive. “Now the system needs to catch up.”

Enel Green Power, the renewable energy arm of Italy’s Enel Group, continues to test hybrid applications abroad. Its 2018 pilot project in Chile combined geothermal and battery storage at Cerro Pabellón, showcasing the potential for flexible geothermal systems. While the company has not yet introduced similar projects in the US, it remains active in research and exploration.

Despite the headwinds, the sector’s outlook remains strong. A recent McKinsey report suggests the US could deploy up to 100GW of geothermal capacity by 2050 if regulatory and financial frameworks improve. That would represent a substantial expansion from the roughly 4GW currently installed.

As firms adjust their strategies and technologies, industry executives say geothermal is moving beyond its niche status. The coming years will test whether developers and policymakers can align fast enough to meet the sector’s potential.