Geothermal giant Ormat is diving into power for data centers.
Until this year, the company had never signed a power purchase agreement directly with a large load user. Now, just two months into 2026, Ormat has signed two data center power deals — with the latest involving building new power plants specifically to power Google’s Nevada data centers.
The PPA will be funded under the model established by the hyperscaler’s so-called “clean transition tariff.” In 2024, Google unveiled the novel rate structure with Nevada utility NV Energy, which allows a large customer (like a hyperscaler or other large load) to pay a premium for power from emerging technologies like enhanced geothermal. The original pitch involved Fervo, the enhanced geothermal company that recently filed to go public.
With the Ormat deal, however, the CTT is growing up. It’s Google’s second time using the novel funding model (or at least the second deal that it has made public), and the first since the first-of-a-kind funding model won approval from the Nevada Public Utilities Commission last summer.
Under the long-term PPA, Ormat will supply NV Energy with up to 150 megawatts of new geothermal capacity. It will support multiple new projects across the state of Nevada, expected to come online between 2028 and 2030. The contract term will begin when the first project achieves commercialization, and wind down 15 years after the final project does.
The PPA is subject to approval by the Nevada PUC, which the companies expect to secure in the second half of 2026.
The deal also marks an apparent strategic shift for Ormat. While the company has historically operated as a traditional power producer selling directly to utilities, load growth has changed things. In January, the company signed its first-ever PPA with a data center operator: seemingly a proof of concept. Under a 20-year deal, Switch will purchase roughly 13 megawatts of energy from the Ormat’s existing Salt Wells geothermal power plant in Western Nevada. Ormat also will have the option to expand the plant’s output by about 7 MW by tacking on a solar facility to serve the plant’s auxiliary power needs.
Now, the company is leveling up; the Google-NV Energy deal is more than 10 times as big. And while the company won’t be selling power straight to Google, the CTT is a way for NV Energy to earmark the power from the new data centers specifically for the hyperscaler’s data centers.
Crucially, the announcement does not specify whether the projects will rely on conventional geothermal — i.e. tapping into naturally occurring reserves of hot water — or advanced technologies. That said, the CTT is designed as a way to help pay for projects that use emerging technologies that might otherwise have been too challenging or too expensive to develop with utility ratepayers footing the bill.
Ormat is one of the world’s biggest conventional geothermal players, but in August inked a major strategic partnership to license Sage Geosystems’ next-generation technology. As part of that deal, Sage is building its first commercial plant at one of Ormat’s existing power stations. At the time, Sage CEO Cindy Taff told Latitude that the new facility could be online as soon as this year. The company has since raised a more than $97 million Series B round.
There are several different pathways to next-generation geothermal, but Sage’s approach involves using off-the-shelf oil and gas technologies to drill deep artificial fissures that they fill with water to produce steam. The approach in theory offers more geographic flexibility — meaning plants could potentially be located in the proximity of data centers — though under the Ormat deal the companies plan to drill below one existing underground reservoir and build an entirely new well to expand the facility and extract previously untapped heat.
As of the time of publication, Ormat did not respond to Latitude Media’s request for more details on its technology plans.
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