Unleashing the green power of geothermal energy is a dream rapidly coming true thanks to its promise to deliver on-demand power and heat 24/7.

Yet its full potential to become a backbone of the modern economy as fossil fuel reliance is phased down is only now being scaled up.

Harnessing the earth’s natural heat, geothermal energy provides a reliable and continuous power source.

Thermal energy can deliver a stable energy supply, crucial to meeting the demands of our always-on society – making it a strategic investment for green tech funds as countries strive to achieve net-zero emissions.

The geothermal industry is currently valued at approximately $5.2 billion, but projections suggest it could grow significantly by 2040, potentially reaching around $20 billion, driven by growing demand for renewable energy sources.

The World Bank has highlighted the potential of geothermal energy as a sustainable and reliable resource, particularly in regions with high geothermal activity.

The World Bank notes geothermal energy's ability to provide baseload power and reduce reliance on fossil fuels.

Geothermal energy is already being harnessed in the US, Indonesia, the Philippines, Iceland, and Italy with the technology also being adopted for heating, cooling, and direct-use applications beyond electricity generation.

Iceland particularly stands out as a pioneering example. The country ranks a global leader in geothermal energy utilisation, with approximately 90 per cent of its homes heated by geothermal sources.

Baseload Capital, a key player in the geothermal space, has successfully financed and developed projects in collaboration with impact-driven funds like Bluepurpose to leverage natural resources, create jobs, and position Iceland as a model for other countries seeking geothermal solutions.

One standout project is the Kopsvatn pilot power plant in Iceland, which has an installed capacity of about 600 kW of electricity and provides hot water to the local municipality heating network for heating homes, greenhouses, bathing facilities and more.

Baseload Capital also operates successful geothermal power plants in the USA, Japan and Taiwan.

Fluctuating fossil fuel prices and global government moves toward decarbonisation further bolster the economic case for thermal energy.

Funds like Blue AB are capitalising on this growing market by investing in companies focused on thermal energy, such as Baseload Capital.

"The sustainability-focused approach of geothermal energy aligns perfectly with the goals of green tech funds like ourselves," said Klas Gustafsson, Bluepurpose Portfolio Manager.

He added that as investors seek opportunities that contribute positively to the planet, thermal energy stands out as a logical choice.

"Supporting innovative geothermal projects that reduce carbon footprints and promote renewable energy sources allow us to play a key role in transiting to a sustainable future," Klas added.