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Arizona, Colorado, New Mexico, and Utah are joining forces to accelerate deployment of clean, around-the-clock geothermal energy in the region.
America’s ambitions to harness geothermal energy just keep getting bigger.
On Wednesday, a bipartisan group of Mountain West governors unveiled an initiative to unlock an estimated 200 gigawatts of clean, always-on energy by tapping into the region’s underground heat. That much power would represent a 50-fold increase in the nation’s current ability to generate geothermal electricity.
Arizona, Colorado, New Mexico, and Utah launched the Mountain West Geothermal Consortium a week after the geothermal startup Fervo Energy went public and its valuation rose to over $10 billion. Fervo alone estimates that it has the potential to develop over 42 GW in total geothermal capacity across the nearly 600,000 acres it’s leasing in Western states.
Geothermal energy is gaining traction on both sides of the aisle at a time when data centers, factories, and increasingly electrified cars and buildings are pushing the country’s power grids to the brink.
Yet Fervo and other geothermal firms have many hurdles to clear before they can turn those hypothetical gigawatts into real-world projects. By teaming up, the four states aim to ease some of the financial, permitting, and logistical challenges that stand in the way of widespread geothermal deployment.
“The idea that we can unleash clean, affordable, dispatchable power … that’s kind of the Holy Grail, what we’ve all been chasing. And yet it’s a reality now in ways that it’s never been before,” Utah Gov. Spencer Cox, a Republican, said during the Wednesday news conference.
Utah in particular has become a hot spot for developing the next generation of geothermal technologies, which promise to sidestep the limitations of conventional systems. Existing geothermal plants rely on naturally occurring reservoirs of hot water and steam to spin turbines that produce electricity. But new drilling techniques and tools are enabling companies to access heat in more places, and at greater depths, than was previously possible.
The federally backed Utah Forge project in Beaver County helped develop and test ​“enhanced geothermal systems,” which use horizontal drilling and fracking to create artificial reservoirs underground. Now, Fervo is commercializing the technology at a nearby site. The first phase of Fervo’s 500-megawatt Cape Station project will start sending power to the grid this fall.
“The Mountain West region has an opportunity to lead the world,” Cox said.
Utah is currently home to four conventional geothermal power plants totaling 88 MW in capacity. New Mexico has a single, 14-MW facility, while Arizona and Colorado don’t have any.
The new consortium is led by the Center for Public Enterprise, a New York–based think tank, and the nonprofit organization Constructive, with geothermal companies, investors, and potential customers serving as advisers to the states. The effort was inspired by CPE’s April 2025 report calling on policymakers to ​“deliberately build the legal, financial, and market infrastructures” to accelerate enhanced geothermal projects.
As part of the effort, the four participating states will work to coordinate their permitting processes to speed up approvals and have agreed to share data needed to find and build new geothermal plants. They will also work to improve regional grid interconnections for the projects and to create financing mechanisms that encourage both public and private investment.
Among the biggest barriers to scaling geothermal is what CPE has called ​“a vicious cycle” in project financing.
In order to get money to build projects, developers must first spend millions of dollars to drill exploration and test wells to prove their systems can produce sufficient amounts of energy over time, while also showing they can bring down drilling costs. ​“However, providing this evidence requires additional drilling and larger operational datasets, which require capital the sector does not possess,” CPE said in a separate 2025 report.
To break that bottleneck, states could work with the federal government to replicate projects like the Utah Forge site across the region and take on much of that risky, expensive early work, according to CPE. They could also provide short-term public loans and create prepayment structures that help boost the cash flow and creditworthiness of projects to attract private investors.
At this week’s launch event, Ben Serrurier, Fervo’s director of government affairs and policy, said his firm is excited to work with the states ​“on the financing solutions that can have us be drilling more wells in new places, bringing down costs faster … and finding where we can do projects we never thought projects were possible.”
Cox said a key goal of the Mountain West consortium will be to bring ​“some heft” to Washington, D.C., to advocate for federal funding and policies that support a geothermal expansion. Over 90% of identified U.S. geothermal resources are on federally managed lands, and federal permitting processes can be slow and cumbersome — though recent reforms by the Bureau of Land Management and bipartisan bills in Congress all aim to streamline permitting for geothermal projects.
“If it’s just one state going it alone, that’s great, but you don’t get the attention, the capital, the investment that you need,” Cox said.
Colorado Gov. Jared Polis, a Democrat, agreed. ​“The more that we can work to harmonize and de-risk investments in geothermal … we can really support geothermal nationally,” he said.
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