India’s geothermal energy dreams gather steam

India’s long-awaited geothermal energy ambitions have taken a significant step forward with the successful completion of two deep geothermal wells by Oil and Natural Gas Corporation (ONGC) at Puga Valley in Ladakh, opening up fresh possibilities for clean, dependable and round-the-clock renewable power.

On July 17, Vinai Kumar Saxena, Lieutenant Governor of the Union Territory of Ladakh, inaugurated India’s first demonstration-scale geothermal power project at the Puga Geothermal Project site, marking the successful completion of geothermal wells GT-02 and GT-03 by the ONGC Energy Centre.

Calling it a landmark achievement, Union Minister for New and Renewable Energy Pralhad Joshi said India has commissioned its first-ever geothermal wells at Puga Valley, paving the way for the country’s first 1 MW geothermal power project. The wells have been drilled to a depth of nearly 1,000 metres at an altitude of more than 14,000 feet, where underground temperatures are expected to exceed 200°C.

Geothermal energy is generated by harnessing the Earth’s internal heat. It taps naturally occurring reservoirs of hot water and steam found deep beneath the Earth’s surface, providing a clean, reliable and round-the-clock source of electricity that is unaffected by weather conditions.

According to the Geological Survey of India (GSI), the country has around 350 high-potential geothermal sites with an estimated power generation potential of about 10,600 MW. These resources are spread across the Himalayan belt, Uttarakhand, the North-East, the western coastal regions of Gujarat and Maharashtra, the Son-Narmada-Tapi (SONATA) basin, and the Godavari basin in southern India.

The GSI has mapped and documented 381 hot springs across the country. Based on detailed studies, 42 geothermal manifestations have been identified as promising locations for geothermal power generation and direct heat applications. These sites have been included in the National Policy on Geothermal Energy, notified by the Ministry of New and Renewable Energy (MNRE), for further exploration and development.

National policy provides the missing push

India’s first National Policy on Geothermal Energy, notified on September 15, 2025, aims to create a favourable ecosystem for the sector by providing policy support and investment incentives.

The policy encourages bilateral and multilateral technology partnerships, knowledge transfer and joint research and development to adapt proven global geothermal technologies to Indian conditions. It also permits 100% foreign direct investment (FDI), proposes the utilisation of abandoned oil and gas wells for geothermal extraction, and recommends viability gap funding to offset the high upfront capital costs, estimated at around ₹36 crore per MW.

The Ministry of New and Renewable Energy has already established cooperation mechanisms with Australia, Iceland, Saudi Arabia and the US in the geothermal energy sector.

From pilot projects to commercial scale

The Puga Valley project has had a long and challenging journey. ONGC began work at the site several years ago but suspended drilling three years ago due to technical difficulties and protests by local residents over the discharge of mineral-rich water into the Puga stream.

The company resumed drilling last year using advanced equipment to complete two 1,000-metre-deep wells. With temperatures expected to exceed 200°C, the project is expected to provide critical data for scaling up to commercial geothermal power generation.

Another public sector energy company, Oil India Limited (OIL), is also conducting studies to establish geothermal projects in Arunachal Pradesh and Assam. The MNRE has already approved five pilot and demonstration-scale geothermal projects across the country.

Separately, Coal India’s Singareni Collieries Company Limited (SCCL) recently commissioned India’s first geothermal generation unit—a 20-kW pilot plant—in the Manuguru region of Telangana’s Bhadradri Kothagudem district.

Globally, geothermal power remains a relatively underutilised renewable energy source despite its ability to provide continuous baseload electricity. Installed geothermal capacity worldwide currently stands at around 17-18 GW, contributing less than 1% of global electricity generation.

The US leads the world with around 4 GW of installed geothermal capacity, followed by Indonesia (2,742 MW), the Philippines (2,034 MW), Türkiye (1,797 MW) and New Zealand (1,259 MW).

Private sector interest yet to take off

Despite India’s sizeable geothermal resource potential, private sector participation has remained limited due to the absence of supportive policies and financial incentives until recently.

Tata Power was among the first Indian companies to explore geothermal energy overseas. In 2010, it acquired an 11.4% stake in Geodynamics, an Australian company specialising in Enhanced Geothermal System (EGS) technology, which was developing a pilot geothermal project with Origin Energy. The project was commissioned three years later.

In the same year, a consortium comprising Tata Power (47.5%), Origin Energy (47.5%) and PT Supraco Indonesia (5%) won the rights to develop the 240 MW Sorik Marapi geothermal project in northern Sumatra, Indonesia. Tata Power, however, exited the project in 2016 after selling its stake to Singapore-based KS Orka Renewables.