Unearthing Profits: How Baker Hughes’ Geothermal Strategy is Powering the 2025 Energy Transition

Industry Adoption: Baker Hughes’ Shift from Geothermal Prospecting to Powering Megawatt-Scale Projects

Between 2021 and 2024, Baker Hughes methodically laid the groundwork for its geothermal ambitions, operating primarily as a strategic investor and technology scout. This foundational period was characterized by targeted capital injections into innovators to build a portfolio of next-generation solutions. The company made a key investment in GreenFire Energy in March 2022 to advance its closed-loop geothermal technology and followed with a second investment in Baseload Capital in June 2023 to help fund global project deployments. These moves were about de-risking emerging technologies and securing a seat at the table. Partnerships, like the one with Australia’s Earths Energy in March 2024, were exploratory, focused on evaluating the potential for advanced geothermal systems in new markets. This phase highlights a strategy of cultivating a diverse range of technological options—from advanced closed-loop systems to retrofitting abandoned wells—without committing to a single path, positioning the company for future breakthroughs.

The period from January 2025 to today marks a decisive inflection point, shifting from strategic positioning to large-scale commercial execution. The abstract potential of the prior years has crystallized into concrete, high-value contracts that validate the company’s strategy. The agreements with Fervo Energy (September 2, 2025) to supply Organic Rankine Cycle (ORC) power plants for the Cape Station project in Utah, and with CTR (September 9, 2025) to provide critical technology for the 500 MW Hell’s Kitchen project in California, are landmark events. These are not small-scale pilots; they represent the commercial deployment of enhanced geothermal systems (EGS) at a scale capable of providing significant baseload power. This transition from portfolio-building to delivering critical-path equipment for megaprojects signals that the market for EGS is maturing rapidly, and Baker Hughes has successfully positioned itself as an indispensable technology provider. The opportunity has sharpened from a general pursuit of renewables to targeting high-demand applications like baseload power for industrial use and AI-driven data centers.

Table: Baker Hughes’ Strategic Geothermal Investments

Table: Baker Hughes’ Key Geothermal Partnerships and Commercial Projects

Geography: Baker Hughes’ Geothermal Focus Sharpens on the U.S. West

Between 2021 and 2024, Baker Hughes’ geothermal activities were geographically dispersed and largely exploratory. The strategy involved placing bets in multiple regions to gain a foothold in emerging markets and technologies. This included a partnership with Earths Energy to evaluate projects in Australia, a global remit through its investment in the Sweden-based Baseload Capital, and a focus on U.S. technology innovation with its investment in California’s GreenFire Energy. This period was defined by a broad, scouting approach, building a global network of expertise without concentrating heavily in any single geography.

In 2025, the geographic focus has pivoted dramatically towards North America, specifically the U.S. Mountain West and California. The landmark deals with Fervo Energy in Utah (Cape Station) and CTR in California (Hell’s Kitchen) anchor Baker Hughes’ activities in regions with favorable geology, established policy support, and proximity to high-demand centers. This consolidation indicates that the U.S. is the primary commercial battleground for large-scale EGS deployment in the near term. Simultaneously, the July 2025 agreement with Ukraine’s Naftogaz introduces a new, opportunistic geographic vector. This move signals a potential new driver for geothermal development: energy security in geopolitically sensitive regions, representing both a significant new opportunity and a higher-risk market.

Technology Maturity: Baker Hughes’ Journey from Geothermal R&D to Commercial Scaling

The 2021–2024 period was defined by Baker Hughes’ engagement with next-generation geothermal technologies that were pre-commercial or in early-stage validation. The investment in GreenFire Energy’s advanced closed-loop systems and the launch of a consortium to repurpose abandoned oil and gas wells for geothermal production in December 2022 demonstrate a focus on R&D-heavy concepts. At this stage, the company was acting as a strategic enabler, providing capital and technical expertise to help mature these novel approaches. The technology was largely at the pilot and demonstration phase, with Baker Hughes building a portfolio of options for a future market.

The technology landscape has transformed in 2025, moving from demonstration to full-scale commercial deployment. The Fervo and CTR projects are not experiments; they are tangible proof of the commercial readiness of Enhanced Geothermal Systems (EGS). By supplying critical-path equipment like Organic Rankine Cycle (ORC) power plants and advanced, high-temperature drilling technologies, Baker Hughes has transitioned from a technology investor to a core industrial supplier for the burgeoning EGS market. These agreements, supporting hundreds of megawatts of baseload power, serve as a powerful validation point. They confirm that the underlying technologies have matured to a bankable stage, capable of attracting significant project financing and addressing real-world energy demands, marking a pivotal moment for both the geothermal sector and Baker Hughes’ role within it.

Table: SWOT Analysis of Baker Hughes’ Geothermal Strategy

Forward-Looking Insights and Summary

The data from 2025 signals a clear acceleration of Baker Hughes’ geothermal strategy, transitioning from a phase of careful preparation to one of aggressive commercialization. The landmark agreements with Fervo Energy and CTR are not just wins for Baker Hughes; they are powerful market signals that Enhanced Geothermal Systems are entering the mainstream as a bankable, scalable source of baseload renewable power.

Looking ahead, market actors should watch three key indicators. First is the execution of the Cape Station and Hell’s Kitchen projects. Successful delivery will solidify Baker Hughes’ leadership and de-risk similar projects globally, likely unlocking a new wave of investment. Second, the Naftogaz MoU in Ukraine is a critical bellwether. If this partnership translates into tangible projects, it could pioneer a new market for geothermal driven by national energy security, opening a new, albeit higher-risk, frontier. Finally, the market should monitor whether the technologies Baker Hughes invested in from 2022-2023, such as GreenFire’s closed-loop systems, begin to feature in its next round of commercial agreements. This would demonstrate a fully realized, end-to-end strategy, from venture investment to scaled deployment, and confirm the company’s ability to successfully pick and scale winning technologies. The momentum is clearly with large-scale EGS, positioning Baker Hughes to be a central player in powering the next decade of the energy transition.

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Frequently Asked Questions

What is the main change in Baker Hughes’ geothermal strategy between the 2021-2024 and 2025 periods?
The main change is a shift from strategic investment and technology scouting (2021-2024) to large-scale commercial execution (2025). The company transitioned from making exploratory investments in innovators like GreenFire Energy to securing major contracts to supply critical equipment, such as ORC power plants, for megawatt-scale projects like Fervo Energy’s Cape Station.

Which specific regions are the primary focus of Baker Hughes’ recent commercial geothermal projects?
In 2025, Baker Hughes’ geographic focus has sharpened on North America, particularly the U.S. Mountain West (Utah) and California. This is highlighted by the landmark deals for the Cape Station project in Utah and the 500 MW Hell’s Kitchen project in California, anchoring its activities in these high-potential regions.

What specific technologies is Baker Hughes providing for the large-scale Fervo and CTR projects?
For the Fervo Energy Cape Station project, Baker Hughes is providing five Organic Rankine Cycle (ORC) power plants. For CTR’s Hell’s Kitchen project, the company is supplying a range of technologies including high-temperature drilling, power systems, and digital services, demonstrating its role as a core industrial supplier for Enhanced Geothermal Systems (EGS).

How has the primary risk to Baker Hughes’ geothermal business evolved?
The primary risk has shifted from technological and market uncertainty to project execution risk. In the earlier phase, the main threat was whether geothermal technologies would become commercially viable. Now that the market is maturing with large-scale projects, the risk is centered on the company’s ability to successfully deliver these complex, first-of-their-kind projects on time and on budget.

Besides the major U.S. projects, what new type of opportunity is Baker Hughes exploring in 2025?
In July 2025, Baker Hughes signed an agreement with Naftogaz of Ukraine, signaling an opportunistic move into a new market driven by energy security. This partnership explores geothermal development as a way to strengthen Ukraine’s energy sector, representing a potential new frontier for geothermal in geopolitically sensitive regions.