A 60-year-old geothermal company just became an AI infrastructure play
Ormat, a geothermal company founded six decades ago, has signed a power purchase agreement with Google for up to 150MW in Nevada and is running enhanced geothermal pilots with Sage Geosystems and SLB. Europe faces similar demand but addresses it differently. While Iceland runs on geothermal power and Italy has been generating it since 1911, Denmark has paused grid connections due to data centers overwhelming the cleanest grid on the continent.
The US contract stands out as a significant shift for Ormat, which has historically sold to utilities. Its first direct agreement with a large power user was signed in January with Switch, covering about 13 megawatts. The new Google contract is over ten times that size, expected to come online between 2028 and 2030.
Geothermal energy offers continuity as it operates day and night regardless of weather, making it valuable for data centers. Ormat plans to expand its capacity, targeting 2.8GW by 2028 through conventional plants and storage. A bigger bet is enhanced geothermal, using techniques from oil and gas drilling, with pilots expected online in late 2027.
This expansion isn’t speculative; Ormat reported revenue of $662.7mn in the first half of 2026, up 43%, with a net profit of $71.2mn. CEO Doron Blachar is confident, stating that "all the stars are aligned exactly on time."
While Fervo Energy, an enhanced geothermal specialist, listed at a $10bn valuation in May and now stands at about half that, Ormat’s focus on a solid contract sets them apart. Europe, facing similar demand, turns to alternatives as hyperscalers sign long-term agreements elsewhere.