Geothermal Energy Market Outlook 2026-2031: Growing at a CAGR of 10.42%, with Asia-Pacific Emerging as the Fastest-Growing Region, Says Mordor Intelligence

HYDERABAD, India, June 17, 2026 /PRNewswire/ -- A recent analysis from Mordor Intelligence indicates that the geothermal energy market is becoming an increasingly important renewable power source. The worldwide installed capacity for geothermal energy is expected to grow from 17.97 GW in 2026 to 29.5 GW by 2031, primarily due to the growing global need for clean power. The increasing need for consistent, continuous renewable electricity is stimulating financial commitments in geothermal initiatives, particularly in the Asia-Pacific region. Although flash steam power facilities still represent a substantial portion of the total capacity, innovations in Enhanced Geothermal Systems (EGS) are making it possible to access geothermal reserves that were previously inaccessible. Furthermore, the expanded application of geothermal energy for district heating, combined with governmental financial incentives, is generating fresh expansion prospects in significant markets.

Geothermal Energy Market Drivers & Key Trends

Supportive Policy Frameworks 
Favorable government policies, including financial incentives, attractive tariffs, and simplified approval procedures, are boosting the commercial feasibility of geothermal ventures. Such actions mitigate investment risks, stimulate exploration efforts, and draw more private sector involvement in prominent geothermal markets.

Competition from Lower-Cost Renewable Technologies 
Geothermal energy faces heightened competition due to the swift reduction in expenses for solar and wind power. Consequently, developers in the geothermal sector are prioritizing uses that demand dependable, continuous energy provision and supplementary grid support capabilities.

Expanding Adoption of Ground-Source Heating Systems 
The expanding deployment of geothermal heat pumps is generating new possibilities extending beyond electricity production. A rising preference for energy-efficient heating and cooling options in residential, commercial, and communal heating systems is fueling market growth.

Rising Demand for Reliable Clean Energy 
Given the global emphasis on ensuring energy security and stable power grids, geothermal energy is drawing increased interest because of its capacity to deliver ongoing renewable electricity. Decision-makers and power providers are increasingly recognizing geothermal as a crucial asset for maintaining reliable, low-carbon power infrastructure.

Comprehensive details regarding market dimensions, segmentation information, and competitive insights are available within the Mordor Intelligence report, accessible via: 
https://www.mordorintelligence.com/industry-reports/geothermal-energy-market?utm_source=prnewswire

Details on the Geothermal Energy Industry Segments:

• By Plant Type: Dry Steam Plants Flash Steam Plants Binary Cycle Plants Combined Cycle/Hybrid Plants Enhanced Geothermal Systems (EGS)
• By Application: Electricity Generation District Heating and Cooling Industrial Process Heat Divided
• By Geographically: North America Europe Asia-Pacific South America Middle East and Africa

Overview of the Geothermal Energy Market by Region

The Asia-Pacific region continues to be the dominant geothermal market, propelled by continuous capacity growth, supportive policies, and increasing capital allocation for resource development. Nations like Indonesia, the Philippines, Japan, and China are consistently fortifying their geothermal industries through new developments and heightened exploration efforts.

North America is experiencing revived enthusiasm for geothermal energy, underpinned by advantageous leasing frameworks, incentives for exploration, and technological progress that enhances the feasibility of resources previously not fully exploited. The United States continues to be the key driver of expansion within this region.

Obtain complete market intelligence and regional assessments, including a specific Japan edition, at: https://www.mordorintelligence.com/ja/industry-reports/geothermal-energy-market?utm_source=prnewswire

Himanshu Vasisht, a Senior Research Manager at Mordor Intelligence, says, "The capability of geothermal energy to supply dependable, ceaseless renewable power is garnering renewed focus as nations strive for energy security and decarbonization objectives. Mordor Intelligence employs a combination of organized primary research, thorough secondary verification, and clear forecasting methodologies to offer a balanced perspective on market evolution, capacity expansions, and nascent investment patterns."

Companies in the Geothermal Energy Sector:

• Ormat Technologies Inc.
• Enel Green Power
• Calpine Corporation
• Toshiba Energy Systems & Solutions
• Mitsubishi Power Ltd.
• Fuji Electric Co. Ltd.
• Ansaldo Energia SpA
• Baker Hughes Company
• Turboden
• PT Pertamina Geothermal Energy
• Star Energy Geothermal
• KenGen (Kenya Electricity Generating Co.)
• ENGIE SA
• Aboitiz Power Corporation
• First Gen Corporation
• Sosian Energy Ltd.
• Tetra Tech Inc.
• Alterra Power Corp.
• Contact Energy
• Fervo Energy.

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