Geothermal Energy Survives Trump’s “Big Beautiful Bill”

This story was originally published by Canary Media.

Geothermal energy was spared in U.S. President Donald Trump’s sweeping tax and spending law, which made deep cuts to incentives for other forms of clean energy. But developers of the resurgent energy source may still face difficulties ahead due to complex stipulations folded into the new law, among other Trump administration policies.

The “big, beautiful” Republican legislation largely preserves investment and production tax credits for geothermal power plants — as well as battery storage, nuclear, and hydropower projects — established by the Inflation Reduction Act. Incentives for wind and solar, however, are sharply curtailed, and subsidies for residential clean energy projects will abruptly end after this year.

Geothermal advocates celebrated the outcome for their industry, which they say will be vital to scaling the resource in the United States to meet the nation’s soaring power demand. The sector has attracted a lot of attention in recent years because it can provide carbon-free power around the clock — something solar and wind can’t do — and technological advances are making it possible to deploy geothermal in places that conventional plants can’t go.

This “policy milestone highlights the geothermal industry’s role in fortifying grid resilience and national security,” Vanessa Robertson, director of policy and education for Geothermal Rising, an industry association, said in a statement. “With certainty in place, we look forward to seeing projects advance and innovative partnerships flourish.”

Still, the industry isn’t immune to the broader market challenges created by Trump’s policies, despite its more favorable treatment from Congress.

New tariffs on things like steel and aluminum have increased the cost of drilling equipment, heat exchangers, and other key components. A provision in the budget bill aimed at restricting Chinese companies and individuals from accessing tax credits will make it harder for developers to prove compliance, increasing the risk for investors who finance clean energy projects.

“We’re making an ugly layered cake of barriers to quick and clean project development,” said Advait Arun, a senior associate for energy finance at the Center for Public Enterprise, a nonprofit think tank.

Scaling Enhanced Geothermal Systems

Geothermal plants, which harness Earth’s heat to generate power, have for decades represented less than 1% of the U.S. electricity mix. That’s because conventional plants tend to be viable only when located near natural formations like hot springs, where the heat is easier to reach, but which only occur in a handful of places in the United States.

New tools and techniques are emerging that make it possible to put geothermal plants in more parts of the country.

The startup Fervo Energy completed America’s first “enhanced geothermal system” in late 2023 — a 3.5-megawatt pilot plant in Nevada backed by Google….