Geothermal Power Market Size was valued at USD 4.10 billion in 2021. The geothermal power industry is projected to grow from USD 4.31 Billion in 2022 to USD 6.17 billion by 2030, exhibiting a compound annual growth rate (CAGR) of 5.26% during the forecast period (2022 - 2030). Government rules connected to climate change that are stricter in developed and developing countries are the key market drivers enhancing the market growth.
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
Various severe rules put in place by the governments of various countries which are expected to drive the growth of the geothermal energy market. Fossil fuel scarcity and rising greenhouse gas emissions are further factors driving the market's expansion. The market is anticipated to expand due to the severe volatility of fossil fuel prices. Due to the low cost and high capacity of geothermal energy, the market is expected to expand throughout the forecast period. There is a need for this energy source as a result of all of these factors. The market is expanding as a result of the rising demand for clean and environmentally favourable sources. Governments from different countries offer cash incentives and tax breaks to encourage the use of sustainable energy.
This is presenting chances for the market for geothermal energy to expand. When compared to other renewable energy sources including wind, bioenergy, or hydropower, geothermal power generation is very advantageous. Additionally, the production of geothermal energy has the benefits of low atmospheric pollution, zero liquid pollution, minimal land use, and high availability. A rising demand has led to a rise in the construction of geothermal power plant facilities in recent years. Numerous clubs, organizations, and institutions are soliciting money to support the development of geothermal energy.
Figure 1: Average prices of fossil fuels for the electric power industry in the United States from 2005 to 2021
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
Moreover, the rising demand for electricity worldwide is also a contributing factor in the increased demand for geothermal energy. Accordingly, a number of nations have shifted to clean, renewable energy sources, geothermal being one among them. The production of energy from renewable geothermal sources is anticipated to increase at an average rate of 2% per year, according to an International Energy Agency (IEA) report on geothermal power released in November 2021. Therefore, the rising demand for geothermal energy generation has enhanced the geothermal power market CAGR across the globe in the forecasting years.
Furthermore, according to the International Renewable Energy Agency (IRENA), the electricity generation was 83,477 GWh in 2016 and it is reached by 94,949 GWh in 2020. thus, these types of trends are showing that the demand for electricity are increasing throughout the world which support the growth of geothermal energy market during the forecast period.
The market segmentation, based on geothermal power plant type, includes flash steam plants, dry steam plants, and binary cycle plants. The geothermal binary cycle power plant segment held the majority share in 2021 contribution to around ~40-45% in respect to the geothermal power market revenue. This is primarily due to the binary cycle plants also operates in the artificial lake with lower temperatures as it is a more appropriate option. For instance, United states have 93 binary cycle plants and 79 dry steam plants.
April 2022: The Mindanao-3 binary power plant was constructed and delivered to the Philippines by EXERGY. Following rigorous timelines, the work was completed in less than a year.
The geothermal power market segmentation has been bifurcated by end-use into residential, commercial, and industrial. The commercial end-use segment dominated the geothermal power market data in 2021 and is projected to be the faster-growing segment during the forecast period, 2022-2030. The main driver of the demand for geothermal energy in the commercial sector is the growing use of heat pumps for air conditioning and cooling down inside the environment, when necessary, which maintains a controlled climate in the commercial sector, including office buildings, hotels, schools, and hospitals.
January 2023: The Department of Defense intends to construct an on-site geothermal power station facility and has issued a request for proposals to contractors who can offer a creative, sustainable strategy. The Defense Innovation Unit said that the prototype geothermal systems & solutions would be taken into consideration for installation at DOD facilities across the United States. To ensure that military activities are carried out without interruption, DOD is looking into the possibilities of geothermal electricity as a steady and continuous power source. The agency's sole such facility, which use conventional geothermal energy that is exported to the grid, is situated at Naval Air Weapons Station China Lake in California. Therefore, the adoption of geothermal power plants has further broadened the growth opportunity for the geothermal power resource industry.
Figure 2: Geothermal Power Market, by End-Use, 2021 & 2030 (USD Million)
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
Additionally, this kind of energy is used in homes for heating and cooling needs. In addition, one of the major sources of geothermal energy in residential structures is district heating which are likely to drive sector growth throughout the projection period.
By region, the study provides the geothermal power market insights into North America, Europe, Asia-Pacific and Rest of the World. North America Geothermal energy market accounted for USD 1.77 billion in 2021 and is expected to exhibit a 43.20% CAGR growth during the study period. This is attributed to the growing use of geothermal power plants in residential and commercial sectors for power generation across the region.
Further, the major countries studied in the geothermal power market report are: The U.S, Canada, Germany, France, UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil.
Figure 3: Geothermal Power Market Share By Region 2021 (%)
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
The Asia-Pacific Geothermal Power Market is expected to grow at the fastest CAGR from 2022 to 2030. This is due to huge requirement of power with the increasing population and high growth potential across the Asia-Pacific countries. Moreover, China geothermal energy market held the largest market share, and the India geothermal power market was the fastest growing market in the Asia-Pacific region.
Europe geothermal power market accounts for the significant market share due to the rising adoption of geothermal renewable power as in the current scenario only 10 countries have geothermal power plants whereas more than 20 countries are working on the geothermal projects. Further, the Germany geothermal power market held the largest market share, and the UK geothermal energy market was the fastest growing market in the European region.
Major market players are spending a lot of money on R&D to increase their technology, which will help the geothermal power market grow even more. Market players are also taking a range of strategic initiatives to grow their worldwide footprint, with key market developments such as new technology, contractual agreements, collaborations, increased investments, and mergers and acquisitions with other companies. Competitors in the geothermal power industry must offer cost-effective products to expand and survive in an increasingly competitive and rising market environment.
One of the primary business strategies adopted by manufacturers in the geothermal power industry to benefit customers and expand the market sector is to manufacture locally to reduce operating costs. In recent years, geothermal power industry has provided products which generates more power according to the environment. The geothermal power market major player such as Enel Spa (Roma), General Electric (US), Ansaldo Energia (Italy), Supreme Energy (Indonesia), Macquarie Group Limited (Australia), Sumitomo Corporation (Japan), and others are working to expand the market demand by investing in research and development activities.
Electricity and gas are manufactured and distributed by the international Italian company Enel S.p.A. Ente nazionale per l'energia elettrica, or Enel, was first founded as a public organisation at the end of 1962 and later changed to a limited business in 1992. For instance, the renewables arm of Enel, Enel Green Power S.p.A. (EGP), and Australian renewable energy developer Fortescue Future Industries (FFI), announced in November 2022 that they would collaborate to explore the co-development of the green hydrogen value chain, with an immediate focus on Latin America and Australia.
Also, Tokyo, Japan is home to the integrated trading corporation Sumitomo. The company takes advantage of its integrated corporate power to engage in a variety of business activities. Sales of a range of goods and services within Japan, import and export, trilateral commerce, and domestic and foreign corporate investment are a few examples of these commercial activities. For instance, Sumitomo Corporation (Sumitomo) purchased ENGIE's 15% ownership investment in the PT Muara Laboh Geothermal Power Project in Indonesia in May 2022. As a result, Sumitomo's interest in the project has increased from 35% to 50%.
April 2022 Peninsula Clean Energy and Ormat Technologies have struck a 15-year Power Purchase Agreement (PPA). The city of Los Banos and San Mateo County receive more than 3,500 gigawatt-hours of electricity through this community choice aggregator. The Community Choice Aggregation (CCA) will be buying 26 MW of energy from Ormat's Heber 2 facility starting on January 1st, 2023, for the duration of the contract.
April 2022 Calpine Corporation and Sacramento Municipal Utility District (SMUD) have a deal. According to the agreement, SMUD agreed to purchase electricity from a 100 MW section of the Californian Geysers field. It was a PPA with a 10-year term that became effective on January 1, 2023.
| Report Attribute/Metric | Details |
| Market Size 2021 | USD 4.10 billion |
| Market Size 2022 | USD 4.31 billion |
| Market Size 2030 | USD 6.17 billion |
| Compound Annual Growth Rate (CAGR) | 5.26% (2022-2030) |
| Base Year | 2021 |
| Market Forecast Period | 2022-2030 |
| Historical Data | 2018 & 2020 |
| Market Forecast Units | Value (USD Billion) |
| Report Coverage | Revenue Forecast, Market Competitive Landscape, Growth Factors, and Trends |
| Segments Covered | Power Plant Type, Power Output, End-Use, and Region |
| Geographies Covered | North America, Europe, Asia Pacific, and Rest of the World |
| Countries Covered | The U.S, Canada, Germany, France, UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil |
| Key Companies Profiled | Enel Spa (Roma), General Electric (US), Ansaldo Energia (Italy), Supreme Energy (Indonesia), Macquarie Group Limited (Australia), Sumitomo Corporation (Japan), and others |
| Key Market Opportunities | Rising adoption of renewable power sources across the world |
| Key Market Dynamics | Increasing energy consumption Strict government regulations on the use of fossil fuels |
Geothermal Power Market Highlights:
Frequently Asked Questions (FAQ) :
The geothermal power market size was valued at USD 4.10 Billion in 2021.
The market for geothermal power is projected to grow at a CAGR of 5.26% during the forecast period, 2022-2030.
North America had the largest share in the market for geothermal power.
The key players in the market for geothermal power are Enel Spa (Roma), General Electric (US), Ansaldo Energia (Italy), Macquarie Group Limited (Australia), Supreme Energy (Indonesia), Sumitomo Corporation (Japan), and others.
The binary cycle plant category dominated the market for geothermal power in 2021.
The commercial end-use had the largest share in the market for geothermal power.
Team Lead - Research Anshula mandaokar holds an academic degree in chemical engineering and has been contributing to the field for more than 5 years. she has expertise in market research and business consulting and serves as a team lead for a reputed market research firm under the chemicals and materials domain spectrum. she has worked on multiple projects, generating explicit results in a quick turnaround time. her understanding of data interpretation justifies her role as a leader.
Get in Touch
© 2024 Market Research Future ® (Part of WantStats Reasearch And Media Pvt. Ltd.)
