Chevron’s Geothermal Playbook 2025: Analyzing the $10 Billion Pivot to Baseload Power

Industry Adoption: How Chevron is Reshaping Geothermal Energy Markets in 2025

Between 2021 and 2024, Chevron’s re-entry into the geothermal sector was characterized by strategic exploration and technological de-risking. The establishment of its Chevron New Energies division in 2021 marked the starting point, followed by a series of deliberate, partnership-driven pilot projects. The company focused on next-generation technologies, evidenced by its 2021 venture investment in closed-loop pioneer Eavor Technologies and its 2022-2023 collaborations with MOECO in Japan and Baseload Capital in the U.S. to test advanced systems. This period was about building a foundation, applying its legacy oil and gas expertise to unproven concepts like Advanced Closed Loop (ACL) and Enhanced Geothermal Systems (EGS) in diverse global settings, including Indonesia (Way Ratai) and Japan (Hokkaido). This pattern revealed a cautious but deliberate strategy to learn and validate the potential of disruptive technologies before committing to large-scale deployment.

Since the start of 2025, Chevron has executed a significant strategic inflection, shifting from exploration to accelerated development, backed by substantial capital. The allocation of $10 billion to lower-carbon projects through 2028 provides the financial engine for this pivot. The primary driver has become crystal clear: the surging demand for reliable, baseload power from the AI and data center industry. This is a crucial change, moving geothermal from a niche renewable play to a core solution for a high-growth industrial market. This shift is solidified by the partnership with GE Vernova and Engine No. 1 to develop up to 4 GW of power specifically for data centers. Concurrently, Chevron is advancing tangible assets like the GeoZone geothermal project in California, signaling a move to add megawatts to the grid. This evolution from broad, technology-focused pilots to a targeted, capital-intensive development strategy aimed at a specific, high-value market demonstrates a new level of maturity and commercial conviction.

Table: Chevron’s Geothermal Investment Timeline and Strategy

Table: Chevron’s Geothermal Partnership and Project Ecosystem

Geography: Chevron’s Pivot to the US Geothermal Market

Between 2021 and 2024, Chevron’s geothermal activities were distinctly international and exploratory. The company established footholds in key global geothermal markets to test technologies and assess potential. This included the Way Ratai and Kotamobagu projects in Indonesia with Pertamina, a nation with massive geothermal reserves. In Japan, the partnership with MOECO focused on piloting Advanced Closed Loop technology in Hokkaido. In the United States, activity was centered on the initial stages of the Baseload Capital JV, culminating in the Weepah Hills pilot project in Nevada. This geographic diversification represented a risk-managed approach, spreading bets across different regulatory environments and geological settings to gather broad intelligence.

Beginning in 2025, Chevron’s geographic focus has sharply pivoted toward the United States. While international exploration continues, the most significant commercial and capital commitments are now domestic. The land acquisition for the GeoZone geothermal plant in California, a state with stringent regulations but high power prices, marks a major step toward direct asset ownership. The ambitious 4 GW power development partnership with GE Vernova and Engine No. 1 is explicitly for US-based data centers. Further, selection for a US Department of Energy EGS pilot project reinforces this domestic concentration. This consolidation of focus on the U.S. market is a direct response to a massive commercial opportunity: the domestic AI and data center power crunch, which demands the kind of reliable, 24/7 power that geothermal can provide.

Technology Maturity: Chevron’s Dual-Track Geothermal Strategy

In the 2021–2024 period, Chevron’s strategy was centered on investing in and piloting next-generation technologies that were largely in the pre-commercial or demonstration phase. The $40 million venture investment in Eavor Technologies (2021) was a direct bet on the viability of its novel Advanced Closed Loop (ACL) system. This was followed by the hands-on pilot with MOECO in Japan (2023) to test ACL technology in the field. This focus on “go-anywhere” geothermal solutions like ACL and Enhanced Geothermal Systems (EGS) demonstrated a long-term vision to expand geothermal beyond traditional volcanic hotspots, even if the technologies themselves carried high development risk and uncertain unit economics.

Since 2025, Chevron’s technology strategy has matured into a dual-track approach that balances long-term innovation with near-term commercialization. On one track, it continues to back next-generation systems through its venture arm and participation in the US DOE’s EGS pilot. On the second, and more commercially significant track, it is pursuing projects with more established technology. The GeoZone project in California is located near The Geysers, the world’s largest geothermal complex, suggesting a development approach that leverages decades of conventional geothermal experience. Furthermore, its investment in Foro Energy’s laser drilling technology is a critical enabling play. Rather than betting on a single generation method, Chevron is investing in a cross-cutting technology that can lower drilling costs and improve the economics of *all* geothermal projects, both conventional and next-gen. This shift from purely speculative pilots to a blended portfolio of proven and emerging tech signals that Chevron is now building a business, not just an R&D program.

Table: SWOT Analysis of Chevron’s Geothermal Strategy

Forward-Looking Insights and Summary

Chevron’s geothermal strategy has clearly entered a new phase of commercial acceleration. The data from 2025 demonstrates a decisive pivot from a geographically diverse, technology-testing posture to a capital-intensive, U.S.-focused development model targeting the insatiable power demands of the data center industry. The company is no longer just an investor in geothermal concepts; it is actively building a geothermal business.

Looking ahead, market actors should monitor three key signals to gauge the pace and success of this strategy. First, any progress on the GeoZone project’s permitting in California will be the most critical validation point for Chevron’s ability to execute large-scale development in a key U.S. market. Second, concrete project announcements from the Baseload Capital joint venture, including specific locations and planned capacity, will reveal the operational velocity of its primary U.S. development vehicle. Finally, the ultimate energy mix of the 4 GW data center initiative with GE Vernova will be telling; the degree to which geothermal is integrated alongside natural gas will signal its true role in Chevron’s baseload power offerings.

Chevron is methodically transforming its legacy subsurface competencies into a formidable competitive advantage in the renewable energy landscape. By combining direct development, strategic partnerships, and enabling technology investments, it is not merely participating in the energy transition but actively shaping the future of baseload power. For energy executives, investors, and strategists, tracking these complex, fast-moving developments is essential for identifying opportunities and threats. Platforms like Enki provide the deep, continuous intelligence required to navigate this evolving market and stay ahead of the competition.

Frequently Asked Questions

What is the main driver behind Chevron’s increased investment in geothermal energy in 2025?
The primary driver is the surging demand for reliable, 24/7 baseload power from the rapidly growing AI and data center industry. This high-growth market requires the kind of dependable energy that geothermal can provide, transforming it from a niche renewable play into a core solution for a specific industrial need.

How has Chevron’s geographic focus for geothermal development changed?
Between 2021 and 2024, Chevron’s focus was international and exploratory, with projects in Indonesia and Japan. Since 2025, its focus has sharply pivoted to the United States, driven by the domestic AI and data center power demand. This is evidenced by the GeoZone project in California and the U.S.-focused partnership with GE Vernova.

What is Chevron’s ‘dual-track’ technology strategy for geothermal?
Chevron’s strategy involves two parallel tracks. The first track is focused on near-term commercialization using more established geothermal technologies, such as the GeoZone project near The Geysers. The second track continues to support long-term innovation by investing in and piloting next-generation technologies like Enhanced Geothermal Systems (EGS) and Advanced Closed Loop (ACL).

What is the significance of Chevron’s partnership with GE Vernova and Engine No. 1?
This partnership is a cornerstone of Chevron’s new strategy, aiming to develop up to 4 GW of power by 2027, primarily for U.S.-based data centers. It solidifies Chevron’s pivot from broad exploration to a targeted, capital-intensive development model aimed squarely at a specific, high-value market.

Besides building power plants, how else is Chevron investing to make geothermal more viable?
Chevron is investing in critical ‘enabling technologies’ to improve the economics of all geothermal projects. A key example is its investment in Foro Energy, a startup developing high-power lasers for drilling. This technology aims to lower drilling costs—a major expense for geothermal—making both conventional and next-generation projects more financially competitive.