Geothermal Power Market Generation is Estimated to Witness High Growth Owing to Opportunity of increasing energy security
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| Geothermal Power Market |
Geothermal power generation uses geothermal energy from the natural heat generated and stored in the earth to produce electricity. It is a renewable and sustainable source of energy. Geothermal power plants produce electricity 24 hours a day without emitting any greenhouse gases. With the growing environmental concerns regarding climate change, many countries are shifting their focus towards developing renewable sources of energy. Geothermal energy is baseload renewable energy that can complement other renewables like solar and wind power.
The Global Geothermal
Power Market is estimated to be valued at US$ 5.78 Bn in 2023 and is expected
to exhibit a CAGR of 6.2% over the forecast period 2023 to 2030, as highlighted
in a new report published by Coherent Market Insights.
Market Opportunity:
Increasing energy security is driving the growth of Geothermal Power Market.
Reliance on fossil fuels makes countries vulnerable to price and supply
volatility in international fuel markets. Geothermal power provides a stable
indigenous source of energy that is not reliant on fuel imports. Countries are
increasingly adopting geothermal power generation to strengthen their energy
security and buffer themselves from price shocks in Global oil and gas markets.
The stable base load provided by geothermal power helps countries diversify
their energy mix and reduce geopolitical risks associated with energy imports.
This is expected to drive increased investments in geothermal power projects
across the world over the forecast period.
Porter's Analysis
Threat of new entrants: The Geothermal Power Market has low-medium threat of
new entrants as it requires substantial capital investments for R&D,
resource identification, obtaining licenses, drilling wells and setting up
power plants.
Bargaining power of buyers: The bargaining power of buyers in the Geothermal
Power Market is medium as there are many utilities and corporate buyers with
bargaining power over price and supply depending on the region.
Bargaining power of suppliers: The bargaining power of suppliers is low-medium
as key equipment suppliers have specialized expertise and switching costs are
high, but multiple options are available for other inputs.
Threat of new substitutes: The threat of substitutes is medium-high as
renewable sources like solar and wind power are increasingly becoming viable
substitutes with technology improvements and cost reductions.
Competitive rivalry: The competitive rivalry is medium-high due to increasing
regional and Global capacities.
SWOT Analysis
Strengths: Geothermal energy is a sustainable and Baseload renewable energy
source. Low operational costs once plants are established.
Weaknesses: High initial setup and drilling costs. Location dependent on
available geothermal reserves.
Opportunities: Increasing R&D to utilize abandoned oil and gas wells for
geothermal applications. Growing Global emphasis on renewable and clean energy
sources.
Threats: Technology advancements in other renewable energy sources like solar
and wind. Environmental challenges from drilling activities.
Key Takeaways
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