tech
After 60 years underground, now powering the cloud: Ormat's AI pivot
For 60 years, Ormat Technologies strategically built geothermal power plants where nature allows—over underground reservoirs of high-pressure water or steam—including around the so-called Pacific “Ring of Fire” from Asia to the Americas. Doing so made Ormat the largest geothermal operator in the world.
TL;DR
- Ormat Technologies, a major geothermal operator for 60 years, is expanding into Enhanced Geothermal Systems (EGS) to power the AI data center boom.
- EGS technology aims to make geothermal power generation possible almost anywhere by utilizing advanced drilling and fracking techniques to access deeper underground heat.
- Ormat is launching two EGS pilot projects with partners Sage Geosystems and SLB, and collaborating with Google and Switch.
- The company believes EGS offers significant growth potential, with CEO Doron Blachar highlighting "endless demand" from hyperscalers.
- Ormat's strategy includes leveraging its existing geothermal and battery storage businesses, and its experience in land acquisition, permitting, and power plant construction.
- Ormat's stock has seen a significant rise, and the company is profitable outside of its pilot projects, with revenues and net profits increasing.
- Nevada is a key location for Ormat's EGS pilot projects, with additional acreage acquired in New Mexico, Oregon, and Idaho.
- Geothermal energy enjoys bipartisan support in the U.S., with Democrats favoring clean energy and Republicans noting the opportunities for traditional oil and gas companies.
- Advancements in drilling technology, similar to those used in oil and gas extraction, are making EGS more feasible and economical.
- Ormat has developed a standardized power plant unit, Ormega100, designed for economic scaling with EGS.