(Bloomberg) – A surge in U.S. geothermal leasing activity is signaling a new growth frontier for subsurface drilling and completions expertise traditionally rooted in oil and gas. For the first time in years, the U.S. Bureau of Land Management (BLM) awarded every parcel of public land offered for geothermal development — and at record prices — underscoring how energy demand from data centers and advances in drilling technology are reshaping the market for next-generation geothermal resources.
Average lease prices soared 282% year-on-year to $127 per acre, up from $33 in 2024, according to BLM data. The trend reflects both heightened investor interest and the growing role of oilfield-derived technologies, such as high-temperature drilling, hydraulic fracturing, and horizontal well design, in expanding geothermal’s reach beyond traditional hotspots.
“With the current administration, I think the focus is very much on energy security, energy reliability and energy independence,” said Koenraad Beckers, geothermal energy lead at ResFrac, a hydraulic fracturing simulation software designer. “Geothermal checks all those boxes.”
TheTrump administrationhasstymied wind projectsandscaled back solar incentives, but geothermal is one type of renewable energy that’s seen some support. In February, Energy Secretary Chris Wright directed his agency to “prioritize affordable, reliable, and secure energy technologies,” including geothermal.The tax law Trump signed in July also preservedgeothermal projects’ access totax creditswhile weakeningincentives forwind and solar.
AI’s voracious appetite for energy has also driven interest in geothermalto new highs.Alphabet Inc.’s GoogleandMeta Platforms Inc.are among thedata center operators who have inked deals with geothermal companies to provide much-needed power.
Advancesin geothermal drilling techniques are also helping give the industry new life. Companiesare deployingmethods traditionally used to extract oil and gas, including fracing, to use the Earth’s heat. New technology is making the process cheaper and easier to deploy, while also expandingthe areas suitable to drill for geothermal energy.
These factors are among the reasons analysts at the Rhodium Groupproject thatnext-generation geothermal technology canmeet up to 64% of expected data center-driven energy demand growth by the early 2030s.
BLM has traditionally leased land mostly in Nevada and Utah. This year, it also offered geothermal leases in Idaho for the first time.The 24,000 acres auctioned in Idaho,fetched an average per-acre price of $180, which is $147more per acre than the 2024 average. The highest bid topped out at $412 per acre.Leases usually last for a decade,and the acreage varies widely.
Winning the land leases is the first step in the process, and it will likely take years for these parcels to start producing energy.
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