Next-Generation Geothermal Energy's Role in US Power

McKinsey analyzes the potential for next-generation geothermal energy to meet rapidly rising US electricity demand, driven by electrification, data centers, and manufacturing.

• Next-generation geothermal could supply up to 100 GW by 2050 in the US, with 40 GW by 2035, enabled by new subsurface technologies and cost declines.
• Private capital investment of $900 million in the past five years; levelized costs projected to fall from $75–$120/MWh today to $45–$65/MWh by 2035, making it competitive with other clean, firm power sources.
• Key obstacles: water use, financing risk, grid interconnection delays, and supply chain constraints.
• Stakeholders (investors, oil & gas, utilities, C&I customers, governments) can accelerate deployment through partnerships, resource characterization, and behind-the-meter projects.
• Confirmed actions: Over 780 MW of letters of intent and PPAs signed in the past two years; about 1 GW of projects in development.