The arrival of geothermal in American energy policy

American energy policy continues to reflect profound partisan differences between favored technologies. A Biden-era embrace of renewables such as wind and solar has yielded to a Trump-era push for expanded output of coal, oil, and natural gas. Nuclear represents a rare exception in bridging these divides, although it must address some significant challenges before any projected “renaissance” can be realized.

One additional energy source has more quietly but steadily moved during the 2020s from the periphery toward center stage in federal and state energy policy deliberations, bolstered by unusually broad bipartisan support and poised for significant expansion. Geothermal energy harnesses Earth’s natural heat and is hardly a new discovery. Long after ancient Romans tapped such heat to warm buildings, the world’s first plant using subterranean heat for electricity opened in Italy in 1913 and remains in operation. Geothermal generates little air and greenhouse gas emissions compared to fossil fuels. It provides firm baseload power, unlike wind and solar, contributing to its broad political appeal. The International Energy Agency projects vast global potential for this source, much as the Department of Energy does for the United States. The Center for Sustainable Systems notes that America has tapped under 1% of its geothermal capacity to date.

Nonetheless, geothermal has long remained an afterthought among American energy alternatives and still accounts for less than 1% of total electricity. Its front-loaded development costs tend to be high, and its use for electricity has been historically confined to areas with highly favorable geology. This has limited production in many states, particularly those east of the Mississippi River. Geothermal has also faced some siting controversies, including tribal opposition to proposed projects in Hawaii and New Mexico. Politically, it has historically lacked the type of aggressive and well-funded lobbying presence in Congress or state capitals common for other energy sources and has struggled politically to gain sustained policy support.

A new era for geothermal?

During the current decade, geothermal has quietly gained political traction. It lacks much of the historical baggage associated with other major energy sources, such as air pollution and nuclear waste. Its overall land-use footprint is modest, as a geothermal electricity plant occupies far less acreage than facilities for many other electricity sources and is less likely to generate opposition over its visual impacts. In recent years, four additional factors have boosted its national prominence and use, positioning it for considerable future expansion.

Multiple uses

Geothermal uses are not confined to electricity production, which generally requires supportive geology and very deep drilling. Ground-source heat pumps for building heating and cooling increasingly compete with traditional equipment. They require far less heat access for operation than electricity plants, relying on borehole drilling depths of only 100 to 400 feet versus the depths of a mile or more needed for power generation. Major technological advances have made these increasingly attractive options. Diffusion has been particularly rapid in southeastern and midwestern states for use in both residential and commercial settings, raising awareness of geothermal potential in regions with little prior familiarity with this source. These pumps offer significant energy cost reductions following installation, and systems are quite durable, generally operating decades longer than standard furnace and air conditioning systems. Ball State University in Muncie, Indiana, has replaced four aging coal boilers with a campus-wide geothermal district heating and cooling system, part of a growing national pattern of geothermal use in public buildings. Once operational, such facilities are largely invisible at ground level.

Fracking technology links

The challenge of producing electricity from geothermal sources continues to ease with the expanding application of technologies devised for producing oil and gas. This includes a range of drilling equipment and techniques, linked to hydraulic fracturing and horizontal drilling, that are focused on tapping Earth’s internal heat rather than shale deposits. These include specialized drill bits to accelerate drilling, high-pressure water injection to open rock formations, and the reuse of wells developed previously for oil and gas production. Expanding use of “enhanced geothermal systems” offers significant potential to increase the overall role of geothermal electricity, with most operational American plants located in states with lengthy fossil fuel extraction histories and some fracking expertise. California currently generates more geothermal power than any other state, although Nevada has the highest level of this power source at 10%. Plants also operate in Alaska, Hawaii, Idaho, New Mexico, Oregon, and Utah. Plans for major new production facilities in Nevada and New Mexico were announced last year, driven by investments from Google and Meta to tap clean, firm power sources for data centers. An Alberta facility combines geothermal and natural-gas energy production at a single site.

Federal and state policy boosts

The growing recognition of geothermal potential contributed to its increasing ability to gain political support from federal and state legislators from both parties in both rural and urban areas. Federal policy began to pivot during the first Trump administration with expanded research funding and early permitting coordination programs. This accelerated in the Biden administration with new fiscal incentives. These have remained largely intact in the second Trump administration, including 2025 legislation that also requires annual lease sales for geothermal projects on federal land. One Trump executive order declared geothermal an “essential” energy source, in contrast to the administration’s disdain for other renewables such as solar and wind. States with Republican, Democratic, and mixed-party political control have also markedly expanded policy support for geothermal energy, including both heat pumps and electricity. These include Colorado tax credits for ground source heat pumps, New Mexico authorization to convert oil and gas wells for geothermal production, and Texas permitting clarification for geothermal systems.

Global models

The United States produces more geothermal energy than any other nation, but other national cases demonstrate its potential as a primary energy source. Iceland has increasingly emerged as the international model for far-reaching geothermal use, currently providing 30% of its total electricity and 90% of its heating and cooling. Kenya relies on geothermal electricity for nearly half of its power, the world’s highest rate. New Zealand derives one-fifth of its electricity from geothermal sources and has launched a partnership with Iceland to explore “superhot” or “supercritical” geothermal development. Each of these leading nations has tailored policies to promote geothermal production that warrant American consideration, including siting and royalties.

Future geothermal governance

These factors have converged in elevating American consideration of geothermal energy as a viable option for substantial cooling, heating, and electricity rather than a fringe technology. But continued geothermal expansion is not inevitable and will likely require continued tailoring of both federal and state policy to facilitate further expansion. Federal permitting reform for geothermal as well as other energy sources endures as an ongoing topic of congressional discussion. This will be essential for future geothermal production on federal lands, including wide expanses of western states with particularly strong potential. The House Natural Resources Committee has recently approved a series of bills introduced by both Republicans and Democrats that would alter federal oversight of geothermal development. In turn, there are also major state and local governance considerations in permitting and related oversight, particularly on production proposed for private or state lands. Many state legislatures currently in session are considering new policy steps.

Future permit reform across governmental levels needs to explore ways to accelerate project approvals, consistent with calls for energy “abundance” via land-use siting reforms. But it also needs to ensure that siting decisions are credible and that potential production risks are minimized. Concerns have surfaced over some geothermal electricity production activity, including methane and hydrogen sulfide releases, aquifer contamination, drilling-induced seismicity in South Korea, and plant damage from lava flows from nearby volcanoes in Hawaii. Alongside the need for a modernized permitting system are challenges of improving access to transmission capacity, developing royalty systems for modern geothermal production, and building governmental capacity to implement policies and monitor performance.

Many of these issues can be addressed through the application of global geothermal policy best practices and innovative state oil and gas production policies developed in the fracking era. This body of experience can assist the United States in pursuing a unique opportunity to further accelerate geothermal energy development, while sustaining its unusual political base that endures across partisan divides. As Representative Susie Lee (D-Nev.) has noted, “Geothermal energy is uniting the right, left, and center, as well as Congress and the administration, to take our country forward together.” Such language is rarely used in the 2020s on energy production, environmental protection, or any other domestic policy area. Given the political base and other supportive factors, it is plausible that more new American energy may be produced from geothermal sources by the end of President Trump’s final term than from some rival energy sources with far greater notoriety and policy support.