Meta’s Geothermal Bet: Powering AI Data Centers with 24/7 Clean Energy in 2025

Industry Adoption: Meta’s Strategic Pivot to Geothermal for AI Data Centers

The insatiable energy demand of artificial intelligence is forcing a strategic evolution in how hyperscalers power their infrastructure. Between 2021 and 2024, Meta’s strategy, like its peers, was dominated by massive procurement of solar and wind energy to meet its public 100% renewable goal. However, the operational reality of AI—which requires constant, uninterrupted power—exposed the limitations of intermittent resources. The company’s electricity consumption surged 34% in 2023 alone, making grid reliability the primary bottleneck for expansion. This created a critical inflection point, pushing Meta beyond traditional renewables toward firm, carbon-free power sources.

A pivotal moment occurred in August 2024, when Meta announced a first-of-its-kind partnership with Sage Geosystems to purchase up to 150 MW of power from a next-generation geothermal facility. This was not a passive purchase of energy credits; it was a deliberate investment in a novel technology capable of providing the 24/7 baseload power that solar and wind cannot. This move signaled a major strategic shift: from simply matching annual consumption to actively securing the hourly, reliable, clean energy needed for its AI ambitions. It was the first clear validation that geothermal was no longer a niche-market curiosity but a core component of a sophisticated energy strategy for a leading technology firm.

Entering 2025, this pivot has accelerated from a single bet into a repeatable, portfolio-based approach. In July 2025, Meta announced a second, similar deal, this time to develop up to 150 MW of advanced geothermal energy with XGS Energy specifically for its data center in New Mexico. This second agreement confirmed that the Sage Geosystems deal was not an isolated experiment but the beginning of a larger pattern. By partnering with multiple companies developing different advanced geothermal technologies, Meta is not just procuring power; it is actively cultivating a competitive ecosystem for firm, clean energy. This variety demonstrates a sophisticated de-risking strategy, identifying and validating multiple technological pathways to solve its critical baseload power problem and creating new opportunities for advanced geothermal developers to achieve commercial scale.

Table: Meta’s Key Geothermal Energy Partnerships

Geography: Targeting Geothermal Resources for Meta’s Data Center Expansion

The geographic focus of Meta’s geothermal strategy has become increasingly precise, directly mirroring its data center expansion in resource-rich regions. Between 2021 and 2024, the initial move into geothermal was broad. The August 2024 agreement with Sage Geosystems was framed as a general supply for U.S. data centers, notable for being the “first use of next-generation geothermal energy east of the Rocky Mountains.” This established the United States as the core territory for this strategy but lacked the specificity of later deals, indicating a period of exploration and technological validation rather than targeted deployment.

The period from 2025 to today reveals a significant strategic refinement. The July 2025 agreement with XGS Energy is explicitly tied to a specific location: New Mexico, with the stated purpose of powering the Los Lunas data center. This shift from a general offtake agreement to a geographically targeted project demonstrates a more mature strategy of co-locating baseload clean energy generation with power-hungry AI facilities. The U.S. Southwest, a hub for both data center construction and significant geothermal potential, has clearly emerged as the leading region for this activity. This tells us that Meta is not just buying clean energy but is strategically mapping its infrastructure build-out to regions where it can directly influence and anchor the development of new, firm power resources, creating a new risk of regional grid strain if these projects face delays.

Technology Maturity: From Pilot Validation to Building a Commercial Ecosystem

Meta’s commercial activities provide a clear barometer for the maturity of advanced geothermal technology, showing a progression from initial validation to fostering a competitive market. In the 2021–2024 period, the technology was firmly in a pre-commercial, validation phase. The August 2024 deal with Sage Geosystems, while a commercial agreement, was for a “next-generation” technology with power delivery not expected until 2027. This long lead time signals that Meta was acting as an anchor offtaker for a technology that had yet to achieve scaled, bankable deployment. The agreement itself served as a crucial validation point, providing the commercial backing needed for Sage to move from development to construction.

Since the start of 2025, Meta’s strategy has evolved from validating a single technology to building a multi-provider ecosystem. The July 2025 agreement to “develop” up to 150 MW with a different provider, XGS Energy, confirms that advanced geothermal is still at a stage where it requires strategic partnerships to scale. Meta is not simply buying a finished product; it is co-investing in the development and de-risking of these nascent technologies. By backing multiple players, Meta is accelerating the entire sector’s journey toward commercial maturity. This trend tells us that while investor interest is high, the market timing for widespread, at-scale deployment of advanced geothermal is still several years away, and hyperscalers are currently playing the essential role of market makers to bridge that gap.

Table: SWOT Analysis of Meta’s Geothermal Strategy for Data Centers

Forward-Looking Insights and Summary

Meta’s actions in 2025 signal a clear trajectory for the year ahead: the company will continue to aggressively build out its portfolio of firm, carbon-free power sources, with advanced geothermal as a cornerstone of that strategy. The template is now established: identify promising next-generation technologies, act as the anchor customer to de-risk development, and co-locate these projects with new, power-hungry AI data centers. We should expect to see Meta announce additional geothermal partnerships, likely expanding its geographic footprint beyond the U.S. Southwest to other regions with favorable geology and supportive regulatory environments.

For energy executives, investors, and strategy teams, the key signals to watch are the types of geothermal technologies Meta backs next and the structure of these deals. A move from power purchase agreements to direct equity investments or joint ventures would indicate a deeper commitment and a desire for greater control over its energy supply. What’s gaining traction is the role of the hyperscaler as a “market maker,” a critical catalyst for emerging clean technologies. What’s losing steam is the narrative that annual renewable energy matching is a sufficient or credible long-term solution for powering the AI revolution. Meta’s strategic pivot proves that securing 24/7, carbon-free energy is no longer a theoretical goal but an operational imperative. Understanding these nuanced commercial moves is essential for navigating the opportunities and risks in today’s rapidly evolving energy landscape, and leveraging a dedicated research platform is the most effective way to maintain a competitive edge.

Frequently Asked Questions

Why is Meta investing in geothermal energy instead of just using more solar and wind power?
Meta is investing in geothermal energy because its AI data centers require constant, uninterrupted power (24/7 baseload power), which intermittent sources like solar and wind cannot provide. The article notes that while Meta previously focused on solar and wind to meet annual renewable goals, the operational reality of AI forced a shift toward firm, carbon-free sources like geothermal to ensure grid reliability for its power-hungry infrastructure.

What specific geothermal projects has Meta committed to?
Meta has announced two key partnerships. In August 2024, it partnered with Sage Geosystems to purchase up to 150 MW of next-generation geothermal power. In July 2025, it announced a second deal with XGS Energy to develop up to 150 MW of advanced geothermal energy specifically for its Los Lunas data center in New Mexico.

How has Meta’s geothermal strategy changed between 2024 and 2025?
In 2024, Meta’s strategy began with a single, exploratory partnership with Sage Geosystems to supply its U.S. data centers generally. By 2025, the strategy matured into a repeatable, portfolio-based approach, demonstrated by the second deal with XGS Energy. This new deal was specifically tied to a single data center in New Mexico, showing a more targeted strategy of co-locating generation with demand.

What are the main risks or weaknesses in Meta’s geothermal strategy?
The primary weaknesses are the continued dependence on emerging technologies with long development timelines and project execution risks. Additionally, the SWOT analysis highlights the “fossil fuel paradox”: while investing in clean energy, Meta’s massive energy demand simultaneously drives the need for new fossil fuel infrastructure (like gas plants) to ensure grid reliability, exposing the company to accusations of greenwashing.

What does the article mean when it calls Meta a “market maker” for geothermal energy?
It means that Meta is not just buying a finished product. By acting as an “anchor customer” for multiple next-generation geothermal companies (like Sage Geosystems and XGS Energy), Meta provides the commercial backing and validation these firms need to de-risk their technology, secure financing, and move from development to commercial scale. In doing so, Meta is actively helping to create a competitive market for this new technology.