Geothermal Energy: Advantages, Disadvantages and Applications

The main advantage of geothermal energy is that it runs around the clock at a capacity factor of roughly 65 to 75 percent, far above solar or wind, with lifecycle emissions near 38 g CO2 per kWh. Its main disadvantages are a heavy upfront cost of about USD 4,000 per kW, dependence on a specific underground resource, and the risk of induced earthquakes and gas release. Geothermal supplies electricity, district heating and industrial heat, and world installed power capacity reached about 17,170 MW at the end of 2025. India’s share of that is effectively zero.

How geothermal power works

The Earth’s interior is hot, partly left over from its formation and partly from radioactive decay in the crust and mantle. Temperature rises with depth at about 25 to 30 °C per kilometre on average, and far faster where magma sits close to the surface. Where that heat meets water in permeable rock, you get a geothermal reservoir. Wells bring the hot fluid up, a plant turns it into electricity, and the cooled fluid is injected back down through a second well to keep the reservoir charged.

Three plant types are used, and the choice is decided by the temperature and state of the fluid.

Dry steam plants

The reservoir produces dry steam directly, above about 235 °C, with no liquid water. The steam goes straight from the well into the turbine, condenses, and the condensate is reinjected. This is the oldest and simplest design and also the rarest, because dry steam fields barely exist. Larderello in Italy, running since 1904, and The Geysers in California are the two well-known examples.

Flash steam plants

The most common type worldwide. The reservoir holds pressurised hot water, typically 180 to 370 °C. The well fluid is fed into a flash tank at much lower pressure, so part of it boils instantly, or flashes, into steam. The steam drives the turbine and the leftover brine is reinjected. Double-flash and triple-flash designs put the brine through a second and third lower-pressure flash to squeeze out more steam, adding maybe 20 to 25 percent more output for extra plant cost.

Binary cycle plants

These handle moderate temperature resources, roughly 100 to 180 °C, which is what most of the world actually has. The geothermal water never touches the turbine. It passes through a heat exchanger and gives its heat to a secondary working fluid with a much lower boiling point, such as isobutane, isopentane or R-245fa. That fluid vaporises, drives the turbine and is condensed in a closed loop, an organic Rankine cycle. The geothermal water goes straight back underground.

Because the loop is sealed, a binary plant releases essentially no reservoir gases and loses no water. It is also less efficient, because the temperature difference it works across is small. Almost all new small and medium geothermal plants being built today are binary, and they are the only realistic option for a country whose reservoirs are lukewarm.

Ground-source heat pumps are a different thing

People often mix these up with geothermal power, so it is worth separating them. A ground-source heat pump does not use deep Earth heat at all. Below about two metres the ground stays at a near-constant 10 to 16 °C in most places all year, warmed mainly by the sun rather than from below. A heat pump circulates fluid through buried loops and uses that steady temperature as a heat source in winter and a heat sink in summer.

It produces no electricity. It moves heat, and it does so efficiently: a coefficient of performance of 3 to 5 means 1 kWh of electricity delivers 3 to 5 kWh of heating. Ground-source heat pumps work almost anywhere, including places with no geothermal reservoir at all, and they are by far the largest use of “geothermal” by installed thermal capacity globally. Their drawback is the cost and disruption of digging trenches or drilling boreholes for the ground loop.

Advantages of geothermal energy

• Constant output. Geothermal plants ran at an average capacity factor around 65 to 75 percent in the United States in recent years, against roughly 20 to 25 percent for solar PV and 30 to 35 percent for wind. It does not care about night, cloud or a still afternoon, so it can serve base load and displace coal directly rather than needing storage behind it.
• Very low lifecycle emissions. The IPCC’s median lifecycle figure for geothermal electricity is 38 g CO2-equivalent per kWh, against about 48 for solar PV, 490 for gas and 820 for coal.
• Small land footprint. A geothermal plant plus its well pads typically occupies about 1 to 8 acres per MW. A solar farm of the same annual output needs several times more, partly because of the area and partly because of the capacity factor gap. The well field can sit under farmland or forest with only the pads fenced off.
• Low and predictable running cost. There is no fuel to buy and no fuel price risk. IRENA put the global weighted average levelised cost of geothermal electricity at USD 0.060 per kWh in 2024, a 16 percent fall on the previous year.
• Long plant life and reuse of the resource. Wells and plants run for 25 to 30 years or more, and reinjection of the cooled fluid keeps the reservoir pressure up.
• Cascaded use. Water leaving a power plant at 70 to 90 °C is still useful. Iceland and Turkey run district heating, greenhouses, fish farms and spas on the reject heat, which lifts the overall energy recovery well above the electrical efficiency alone.
• Domestic and secure. The resource cannot be imported, blockaded or price-shocked.

Disadvantages of geothermal energy

• High upfront cost and drilling risk. The global average total installed cost was about USD 4,015 per kW in 2024. Drilling is usually a third to a half of that, and it is spent before anyone knows whether the well will produce. A dry or under-performing well is a write-off, and that exploration risk is the single biggest reason private capital stays away.
• Strictly location-specific. High-temperature resources sit along plate boundaries, volcanic arcs and rift valleys. A country in a stable continental interior can have plenty of hot springs and still have nothing hot enough for conventional power.
• Induced seismicity. Injecting fluid at pressure into deep rock can trigger earthquakes. The Basel enhanced geothermal project in Switzerland set off a magnitude 3.4 event in 2006 and was abandoned in 2009. The 2017 Pohang earthquake in South Korea, magnitude 5.4, is considered by most studies to have been induced by an enhanced geothermal system injecting into a stressed fault, and it injured dozens of people and damaged the city. Conventional hydrothermal plants are much lower risk than enhanced systems, but the risk is real and it decides public acceptance.
• Gas and brine emissions. Reservoir fluid carries dissolved carbon dioxide, hydrogen sulphide, methane, ammonia, boron, arsenic and mercury. Direct CO2 released with the steam varies enormously between fields, from effectively nil at a closed-loop binary plant to more than 100 g per kWh at some high-CO2 flash fields. Hydrogen sulphide is the more immediate nuisance, giving the rotten-egg smell around geothermal areas, and abatement equipment adds cost.
• Reservoir depletion. Take heat and fluid out faster than nature replaces them and the field cools and loses pressure. The Geysers in California fell from a peak of around 2,000 MW in the late 1980s to roughly half that, and recovered part of it only after treated municipal wastewater was piped in and injected to recharge the reservoir.
• Corrosion, scaling and water use. Geothermal brine is aggressive. Silica and calcium carbonate scale block pipes and heat exchangers, and chloride attacks steel, so maintenance is heavier than at a comparable thermal plant. Plants with wet cooling towers also consume water, which matters in dry regions.
• Slow to build and hard to finance. Exploration, test drilling, resource confirmation and construction can take 5 to 10 years, against one to two years for a solar park of similar output.

Advantages and disadvantages of geothermal energy at a glance

Applications and where geothermal energy is used

Global geothermal power capacity was about 17,170 MW at the end of 2025. Leading countries by installed power capacity:

• United States, about 3,900 MW, mostly The Geysers in California and fields in Nevada. The largest total in the world, though it is a small slice of the national grid.
• Indonesia, about 2,650 MW and rising fastest, sitting on the volcanic arc of Sumatra and Java.
• Philippines, about 2,030 MW, supplying a substantial share of national electricity from fields such as Tiwi, Mak-Ban and BacMan.
• Türkiye, about 1,800 MW, almost all built since 2010 in the Menderes graben using binary and flash plants on moderate-temperature brine.
• Kenya, close to 1,000 MW from the Olkaria and Menengai fields in the East African Rift. Geothermal is now the backbone of Kenya’s grid, at roughly 40 percent of generation, which is the highest dependence of any large country.
• Iceland, about 750 MW of power, but the more striking number is heat: geothermal supplies roughly 90 percent of home heating and around a quarter to a third of electricity, with hydro providing the rest.
• New Zealand, about 1,260 MW from the Taupo Volcanic Zone.

Beyond electricity, direct-use applications are larger in thermal terms than power generation:

• District heating of whole cities, as in Reykjavik and in Paris, where the Dogger aquifer heats tens of thousands of homes.
• Greenhouse heating, which lets Iceland grow tomatoes and bananas at 64° north.
• Aquaculture and fish farming ponds held at a steady temperature.
• Industrial process heat: drying timber and food, pasteurising milk, evaporating brine.
• Snow melting on roads and pavements, and balneology, the spa and bathing sector that is the oldest use of all.
• Ground-source heat pumps for building heating and cooling, the fastest-growing direct use.

Why does India have almost no geothermal power?

India’s installed geothermal power capacity is effectively nil. As of September 2026 the country has no commercial geothermal power plant feeding the grid, despite decades of survey work. The first demonstration-scale project, at Puga in Ladakh, is still being drilled by the ONGC Energy Centre, which commissioned two wells of about 1,000 m depth in 2026. Everything else remains exploration.

This is not for want of a resource on paper. The Geological Survey of India has mapped around 340 hot springs across seven geothermal provinces, including the Himalaya, Cambay, Son-Narmada-Tapi, West Coast, Godavari, Mahanadi and Sohana belts. The Ministry of New and Renewable Energy’s National Policy on Geothermal Energy, notified in 2025, works to a potential of roughly 10 GW. The three sites named most often are:

• Puga, Ladakh. The hottest prospect in the country, with boiling springs, sulphur deposits and measured subsurface temperatures well above most Indian sites. It also sits above 4,400 m in Changthang, where winter temperatures fall below minus 30 °C, the working season is short, access roads are seasonal and grid connection is thin.
• Tattapani, Chhattisgarh. Long studied, with exploratory drilling taken up under the state renewable energy agency and NTPC, but no plant built.
• Manikaran, Himachal Pradesh. Hot springs used for bathing and small-scale cooking and space heating, not power.

The honest reasons for the gap:

1. The heat is not hot enough in most places. India’s mainland sits in a stable continental interior with no active volcanic arc. Its geothermal heat comes from radiogenic granites and deep faults, not magma chambers. Most reservoirs are low to medium enthalpy, often under 150 °C at drillable depth, which rules out dry steam and most flash plants and leaves only binary units with thin margins.
2. Nobody wanted to pay for exploration risk. Confirming a reservoir means drilling deep wells that may find nothing. Without a risk-sharing fund or drilling insurance, neither state utilities nor private developers would commit.
3. The best sites are the hardest to reach. Puga is remote, high-altitude and far from demand. A 2021 drilling attempt there hit an uncontrolled discharge and had to be halted, which set the project back years.
4. Solar and wind got cheap first. Between 2010 and 2025 India added hundreds of gigawatts of solar and wind at falling tariffs and short build times. Against a solar park commissioned in 18 months, a geothermal project needing a decade and an unknown drilling bill never won a tender.
5. There was no policy framework until 2025. Geothermal had no dedicated tariff, licensing route or resource-allocation rule. The 2025 national policy is the first attempt to fix that, so any real capacity is years away.

The near-term realistic use in India is heat, not electricity: ground-source heat pumps for cooling and heating buildings, greenhouse and crop drying near hot springs, and space heating in Ladakh and Himachal where the alternative is diesel or kerosene. If Puga delivers a working demonstration plant, it will be a first, not a fleet.

References

• U.S. Department of Energy, Geothermal Technologies Office – plant types and resource basics.
• Geothermal energy overview.
• IRENA, Renewable Power Generation Costs in 2024 – installed cost and LCOE.
• Ministry of New and Renewable Energy, National Policy on Geothermal Energy, 2025.

FAQs

What are the main advantages and disadvantages of geothermal energy?

The advantages are round-the-clock output at a 65 to 75 percent capacity factor, lifecycle emissions of about 38 g CO2e per kWh, a small land footprint of roughly 1 to 8 acres per MW, and no fuel cost. The disadvantages are an installed cost near USD 4,000 per kW, dependence on a specific underground resource, induced seismicity risk, hydrogen sulphide and CO2 release at flash plants, and reservoir depletion if the field is over-produced.

What is the difference between flash steam and binary cycle geothermal plants?

A flash steam plant takes pressurised water at 180 to 370 °C and drops its pressure so part of it boils into steam, which drives the turbine directly. A binary plant handles cooler water of 100 to 180 °C and passes it through a heat exchanger to boil a secondary fluid such as isobutane in a sealed loop. Binary plants are less efficient but release no reservoir gases and suit the moderate-temperature resources most countries have.

Is geothermal energy renewable?

Yes, on a human timescale, because the Earth’s internal heat is replenished continuously by radioactive decay. Individual reservoirs are not infinite, though. Producing fluid faster than the rock can reheat it cools the field, as happened at The Geysers in California, so operators reinject the cooled water to keep pressure and temperature up.

How much geothermal power does India have?

Effectively none. As of September 2026 India has no commercial geothermal power plant supplying the grid. The first demonstration-scale project is at Puga in Ladakh, where the ONGC Energy Centre commissioned two wells of about 1,000 m depth in 2026. India’s estimated potential is around 10 GW, and the National Policy on Geothermal Energy was notified in 2025 to develop it.

Does geothermal energy cause earthquakes?

Injecting fluid at pressure into deep rock can trigger seismic events. Enhanced geothermal systems, which fracture hot dry rock, carry the higher risk: the Basel project in Switzerland caused a magnitude 3.4 event in 2006 and was stopped, and the magnitude 5.4 Pohang earthquake in South Korea in 2017 is widely attributed to an enhanced system injecting into a stressed fault. Conventional hydrothermal plants using existing permeable reservoirs have a far better record.

Related Topics on EngineeringHulk

• 👉 Difference Between Renewable and Non-Renewable Resources
• 👉 Role of Individuals in Conservation of Natural Resources