Geothermal Energy - Europe

The Geothermal Energy Market within the Renewable Energy sector in Europe is witnessing mild growth, hindered by high initial investment costs, limited resource availability, and regulatory challenges that affect project development and financing.

Customer preferences: Consumers in Europe are increasingly prioritizing sustainable living and energy efficiency, driving a growing interest in geothermal energy solutions for residential and commercial applications. This shift is influenced by heightened awareness of climate change and a desire for energy independence. As younger, eco-conscious demographics gain purchasing power, there’s a rising demand for renewable energy sources that offer long-term savings. Additionally, urbanization trends are prompting a reevaluation of energy consumption, with a focus on low-carbon technologies like geothermal systems for heating and cooling.

Trends in the market: In Europe, the Geothermal Energy market is experiencing a surge in adoption as both homeowners and businesses seek sustainable heating and cooling solutions. The transition towards greener energy sources is being accelerated by governmental incentives and policies aimed at reducing carbon footprints. Furthermore, advancements in geothermal technology are enhancing efficiency and affordability, making these systems more accessible. As urban areas expand, the demand for reliable, low-carbon energy solutions is expected to grow, prompting industry stakeholders to innovate and invest in geothermal infrastructure to meet evolving consumer needs and sustainability goals.

Local special circumstances: In Europe, the Geothermal Energy market is shaped by diverse geographical features, such as volcanic regions in Italy and Iceland, which provide abundant geothermal resources. Cultural attitudes towards sustainability vary, with Nordic countries leading in adoption due to strong environmental values. Additionally, regulatory frameworks across the EU encourage investments in renewable energy, offering subsidies and incentives that differ by country. These local factors foster innovation and collaboration among stakeholders, driving the growth of geothermal solutions tailored to regional energy needs and environmental goals.

Underlying macroeconomic factors: The Geothermal Energy market in Europe is significantly influenced by macroeconomic factors such as energy demand, investment trends, and government policies. As countries strive to meet EU climate targets, favorable fiscal policies and incentives are stimulating investments in geothermal projects. Economic stability and growth in nations like Germany and France encourage private sector participation, while volatile energy prices prompt a shift towards renewable sources, including geothermal. Furthermore, technological advancements in drilling and resource management enhance the efficiency and feasibility of geothermal projects, making them more attractive in the broader renewable energy landscape.

Data coverage:

The data encompasses B2B enterprises. Figures are based on the value of electricity production in the energy market.

Modeling approach:

Market sizes are determined through a bottom-up approach, building on specific predefined factors for each market segment. As a basis for evaluating markets, we use resources from the Statista platform as well as annual reports of the market-leading companies and industry associations, third-party studies and reports, national statistical offices, international institutions, and the experience of our analysts.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the S-curve function and exponential trend smoothing are well suited for forecasting electricity generation due to the non-linear growth of this market, especially because of the direct impact of climate change on the market.

Additional notes:

The impact of the COVID-19 pandemic and the Russia-Ukraine war are considered at a country-specific level. The market is updated twice a year.