Key Takeaways

  • Meta announced on Thursday (June 12) an agreement with geothermal energy producer XGS Energy, which will provide carbon-free electricity to the tech and social media giant to support its data center operations in New Mexico.
  • In exchange, Meta will support XGS in developing 150 megawatts of next-generation geothermal power capacity in the state. According to New Mexico Governor Michelle Lujan Grisham, the project will bring $1 billion in private sector investment and create 3,000 construction jobs and 100 plant operations jobs.
  • The agreement further highlights the growing corporate demand for geothermal energy, which provides carbon-free power generation that is not affected by weather. Meta last year signed its first geothermal agreement with Sage Geosystems for a power project east of the Rocky Mountains.

Deep Dive

According to the announcement, XGS's new geothermal plant will be built in two phases and is unique in that it uses proprietary geothermal power generation technology with zero water consumption during operation. The project will first complete a smaller initial phase, followed by a larger later phase, with both phases expected to be completed and operational by 2030.

The XGS project itself is expected to increase New Mexico's total geothermal output by "10 times." Meta's global head of energy, Urvi Parekh, said the company is "excited" to partner with XGS "to unlock a new category of energy supply for operations in New Mexico."

"Advances in AI require sustained energy to support infrastructure buildout," Parekh said in Thursday's announcement. "With next-generation geothermal technologies like XGS's now ready to scale, geothermal can play an important role in supporting technological advances like AI and domestic data center growth."

For Meta, this marks its second foray into the geothermal market, following an agreement with Sage Geosystems in August 2024. That agreement similarly involves developing 150 megawatts of next-generation geothermal power to meet the data center needs of the social media and tech giant driven by the surge in AI applications.

XGS CEO Josh Prueher said the company is "excited to support Meta's ambitious AI goals and accelerate access to new around-the-clock power supply," calling New Mexico a "growth hub for data center development." XGS's technology can decouple geothermal power generation from typical geographic constraints such as water availability or rock permeability. The company just completed a $13 million funding round in March.

Lujan Grisham said in the press release that the partnership between Meta and XGS will strengthen the state's grid and make it a "national leader in next-generation renewable energy."

"We have been working to ensure New Mexico remains at the forefront of the energy transition, and geothermal represents a promising new frontier," she said.

Geothermal energy is increasingly becoming a choice for corporate clean energy buyers, driving startup funding and development deals in the sector.

In March, Mastercard announced it would use geothermal energy to replace the natural gas-powered heating and cooling system at its headquarters in Purchase, New York. That heating and cooling system causes Mastercard's headquarters to consume more natural gas than any of its other offices globally.

Earlier this year, Houston-based geothermal startup Fervo Energy secured $255 million in new debt and equity financing, which the company said will help it deploy the capacity needed to meet "soaring demand for clean, firm power."