Geothermal energy spent decades on the sidelines and now billions of dollars and a drilling revolution are pushing it toward the center of America’s power grid

In 2002, on a sun-baked Nevada desert, a company named Ormat Technologies attempted the unthinkable. They drilled deep into hot, dry rock to pump geothermal liquid into earth that held no natural water reservoir. It took eleven long years to see a result. In 2013, they plugged a modest 1.7-megawatt connection into the power grid. It was the first project of its kind in the nation.

For a long time after that, almost nothing changed. Now, something has.

A 20-year experiment that almost no one noticed

The 2013 milestone at Desert Peak was real, but quiet. The system made history and then largely faded from public conversation. The industry simply lacked the drilling tech and economics to scale it. Enhanced geothermal systems (EGS) remained a promising idea stuck on the shelf for decades.

A separate partnership with Sage Geosystems backed by a $25 million Ormat investment will deploy next-gen tech at another site in Nevada or Utah.

The broader industry sat virtually still. The U.S. held roughly 4 gigawatts of geothermal capacity across 99 plants. Over half of those were in California. Together, they supplied a tiny 0.4% of national electricity. Ormat refocused on traditional underground reservoirs, and EGS went back into storage.

What broke the logjam: Drilling tech, data centers, and dollars

The conditions keeping geothermal sidelined have reversed sharply. Electricity demand is soaring as data centers multiply. States like California, Oregon, and Washington face strict clean-power mandates. Contracts for firm, on-demand power now cost two to three times more than they did in 2021.

A new generation of startups stepped into that opening. Armed with techniques borrowed from oil and gas fracking, companies like Fervo Energy changed the game. Fervo used horizontal drilling and fiber-optic sensors to split hard rock miles beneath the surface. Between 2022 and 2025, Fervo cut drilling times by roughly 75% and per-foot costs by around 70%.

In May 2025, Fervo became the first next-generation geothermal company to go public, raising approximately $1.9 billion. Shortly after, Quaise Energy cited that IPO when announcing a $134 million raise for a superhot geothermal project near an Oregon volcano.

Ormat’s return to where it all began

For Ormat, this momentum hits close to home. The company is partnering with oilfield giant SLB to build a fresh EGS pilot at the original Desert Peak site.

A separate partnership with Sage Geosystems backed by a $25 million Ormat investment will deploy next-gen tech at another site in Nevada or Utah. In June 2025, Ormat unveiled a massive 100-megawatt power unit built for higher subterranean temperatures. It is an expensive bet on an industry that is just now taking off.

Conventional geothermal is also waking up

The buzz around EGS is lifting traditional geothermal too. Hydrothermal plants tap naturally occurring underground hot water, which is cheaper than fracturing dry rock. However, exploration stalled for years because confirming a site requires tens of millions of dollars upfront.

That math is changing. Startup Zanskar raised $40 million in April 2025 to find “blind” geothermal systems using AI. These underground hotspots show no surface vents or geysers. Zanskar says it identified the first commercial blind system in over 30 years.

Ormat is also moving fast. In June 2025, it received fast-tracked federal permits for its 60-megawatt Pearl project in Nevada. Over 90% of known U.S. geothermal resources sit on federal land, making government permits crucial for future growth.

How far geothermal could actually go

The U.S. Department of Energy projects geothermal could supply 90 gigawatts of carbon-free power by 2050. That is more than 22 times current capacity. Fervo’s 500-megawatt Cape Station project in Utah is already on track to become the world’s largest EGS site by 2028.

Unlike solar and wind, geothermal provides baseload power, says GE Vernova. It runs 24 hours a day, 7 days a week, regardless of weather.

After two decades of standing still, the energy revolution has finally arrived. The big question for the next decade is simple: can these startups scale fast enough to meet demand?

Because right now, the answer lies hidden 20,000 feet directly beneath our feet.

Kelly Lippke

Kelly is an experienced writer with 15 years of experience exploring the big stories that shape our world, from tech breakthroughs and space exploration to climate, energy, and the fascinating quirks of science. She has a talent for turning complex ideas into sharp, memorable insights that stay with readers long after they’ve finished reading.