Geothermal power plant
Technical Summary

Geothermal Power

Project Drawdown defines geothermal power as: geothermal systems for electricity generation, combining both mature technologies and future expectations for enhanced geothermal. This solution replaces conventional electricity-generating technologies such as coal, oil, and natural gas power plants.

There are three main geothermal technologies: dry steam, flash steam, and binary cycle power plants. Flash plants are the most common type of geothermal, and make up around 70 percent of total global installed geothermal capacity. Binary plants are the most recently developed geothermal technology, and are able to tap into lower temperature reservoirs (at much higher costs) than flash plants. The selection of which technology to use for geothermal power generation depends on a number of factors, including the characterization of the geothermal resource, and the economic feasibility of the project.

Geothermal energy has the potential to make a much more significant contribution on the global scale through the development of enhanced or engineered geothermal systems, particularly those exploiting “hot rock.” Given the costs and limited full-scale system research to date, enhanced geothermal systems remains in their infancy, with only research and pilot projects existing around the world and no commercial-scale plants available to date.


This analysis models geothermal systems for electricity generation, combining both mature technologies and future expectations for enhanced geothermal systems adoption.

Total Addressable Market[1]

Two total addressable markets were developed for this sector solutions, supported on lower and higher climate emissions mitigation targets linked to different levels of electricity demand and renewable energy sources integration. The total addressable market for geothermal power  is based on projected global electricity generation in terawatt-hours from 2020-2050, with current adoption[2] estimated at 0.34 percent of generation (i.e. 90 terawatt-hours).

Adoption Scenarios[3]

Impacts of increased adoption of geothermal power from 2020-2050 were generated based on two growth scenarios, which were assessed in comparison to a Reference Scenario where the solution’s market share was fixed at the current levels.

  • Scenario 1: this scenario is derived from  the yearly average estimated adoption of IEA (2017) Energy Technology Perspectives 2DS and B2DS scenarios; IEA (2018) World Energy Outlook SDS; and Grantham Institute and Carbon Tracker (2017) NDC policy levels and original technology costs scenario, using a medium growth trajectory.
  • Scenario 2: This scenario follows a high growth using the same scenarios considered for the Scenario 1.

Financial Model

Based on a meta-analysis of the data collected of these systems installation costs around the world, the financial inputs used in the model consider an average installation cost for the combination of different types of geothermal plants of US$4,491 per kilowatt.[4] It is acknowledged that the experimental nature of enhanced geothermal systems technology makes it difficult to evaluate the costs of a commercial-scale enhanced geothermal systems power plant. An average learning rate of 10 percent was used, trying to capture both the future costs for mature technologies such as flash and binary—which could see reduced installation costs in the near future—and the uncertainties in the development of enhanced geothermal systems. In 2030, the investment costs are reduced to US$3,057 per kilowatt, and to close to US$2,475 per kilowatt in 2050. An average capacity factor of 86 percent was used for geothermal systems for electricity generation, compared to 57 percent for conventional technologies such as coal, natural gas, and oil power plants. Variable operation and maintenance costs of US$0.017 per kilowatt-hour and of US$154.3 per kilowatt for fixed costs are considered for geothermal systems, compared to US$0.005 and US$34.7, respectively, for the conventional technologies. When fuel costs are considered, geothermal plants are shown to have significantly lower operational and maintenance costs than coal and natural gas plants.


Through the process of integrating geothermal power with other solutions, the total addressable markets were adjusted to account for reduced demand resulting from the growth of more energy-efficient technologies,[6] as well as increased electrification from other solutions like electric cars  and high-speed rail. Grid emissions factors were calculated based on the annual mix of different electricity generating technologies over time. Emissions factors for each technology were determined through a meta-analysis of multiple sources, accounting for direct and indirect emissions.


Compared to the Reference Scenario, the financial results for the Scenario 1 of adoption show that the marginal first costs projected are US$80.6 billion from 2020-50, with over US$810 billions in savings over the lifetime of the technologies. Under the Scenario 1, the adoption of geothermal technologies for electricity generation could avoid 6.19 gigatons of carbon dioxide-equivalent greenhouse gas emissions from 2020-2050, compared to a Reference Scenario where the solution share in the total addressable market remains similar to the current values.

The Scenario 2 is more ambitious in the growth of these technologies, with impacts on greenhouse gas emission reductions over 2020-2050 of 9.85 gigatons of carbon dioxide-equivalent. Geothermal could act as a form of baseload power and peaking power, helping to support the increased grid integration of other forms of renewable electricity to further bring down emissions.


There exists a vast and untapped technical potential for geothermal energy. Much of the initial development could take place in areas with lots of conventional, high-temperature hydrothermal resources that have yet to be developed, such as Indonesia, the Philippines, Central and South America, and East Africa.

Large upfront costs  and the high risk of investing in geothermal power plants are two of the biggest barriers to the expansion of geothermal electricity. Drilling rig rates and associated costs often make up the largest cost component of geothermal plants, and there is a significantly high chance of failure in exploratory stages. Thus, many governments are setting targets for the development of high-temperature hydrothermal resources. These goals could be aided through: renewable portfolio standards requiring a certain amount of renewable energy use; a price on carbon; and guaranteed power purchase agreements or feed-in tariffs for developers to reliably recover development costs. A publicly accessible and continuously updated database of geothermal resources could also aid in exploration and cut down on production costs. There is also the need for technology research, development, and demonstration concerning enhanced geothermal systems power plants.


[1] For more about the Total Addressable Market for the Electricity Generation Sector, click the Sector Summary: Electricity Generation Sector link below.

[2] Current adoption is defined as the amount of functional demand (i.e. TWh) supplied by the solution in 2018.

[3] To learn more about Project Drawdown’s two adoption scenarios, click the Scenarios link below. For information on Electricity Generation Sector-specific scenarios, click the Sector Summary: Electricity Generation link.

[4] All monetary values are presented in US2014$.

[5] For more on Project Drawdown’s Electricity Generation Sector integration model, click the Sector Summary: Electricity Generation link below.

[6] For example: LED lighting and high efficiency heat pumps.