Google has signed a long-term agreement with renewable energy company Ormat Technologies to bring new geothermal power to its data centers in Nevada, U.S.A. The deal could deliver up to 150 megawatts (MW) of electricity from geothermal sources under a special tariff program.
Ormat will develop a portfolio of geothermal projects across Nevada. These projects are set to come online between 2028 and 2030. Once operational, the electricity will support Google’s growing digital infrastructure.
The guide for this arrangement is NV Energy’s Clean Transition Tariff (CTT), a utility program designed to let large energy users buy new clean power while covering costs without shifting them to other customers.
The contract will begin when the first project starts commercial operation. It will run for 15 years beyond the final project’s completion, creating a long-term revenue stream for Ormat and a stable source of clean energy for Google.
Why Geothermal Delivers 24/7 Clean Baseload Power
Geothermal energy uses heat from deep underground to generate electricity. It can run 24 hours a day, unlike solar or wind, which depend on sunlight or wind. This makes it a baseload power source — always available. That feature is critical for data centers, which require constant electricity.
Ormat is one of the world’s longest-standing geothermal power companies. It designs, builds, and runs plants that convert heat into electricity. Its global portfolio includes nearly 1,700 MW of capacity, with about 1,310 MW in geothermal and solar generation and 385 MW in energy storage.
Here’s how Ormat’s geothermal process works:
In recent years, the tech industry has shown rising interest in geothermal energy. Some operators, including Google, have already signed smaller geothermal power deals in other regions. For example, Google previously secured a 10 MW geothermal PPA in Taiwan and a separate arrangement to procure 115 MW of geothermal power from Fervo Energy in Nevada.
AI’s Energy Appetite and the Need for Clean Power
Data centers consume large amounts of electricity. They house computers that run search engines, Artificial Intelligence (AI), cloud services, and other digital tools. As digital activities grow, so does demand for power.
AI and advanced computing drive particularly strong electricity use. Without reliable clean energy sources like geothermal, data centers often depend on fossil fuels or intermittent renewables that don’t run continuously.
By partnering with Ormat, Google ensures a reliable, carbon-free power supply to meet its needs and reduce its environmental footprint. The new geothermal portfolio is expected to scale with future energy demand from AI and cloud computing workloads.
The Clean Transition Tariff (CTT) model used in this deal is designed so that Google pays full costs for its electricity. This limits cost impacts for other utility customers while enabling investment in new clean generation.
The Ormat–Google Deal: A 150MW Bet on Long-Term Clean Power
The Ormat–Google agreement covers up to 150 MW of geothermal capacity. To put that in context:
- 150 MW can power tens of thousands of homes if it were used for residential consumption.
- For data centers, it represents a meaningful share of electricity demand, especially as AI services expand.
The projects will ramp up over time. The first facilities are expected to start operating by 2028, with additional capacity coming online through 2030. This flexible build-out allows Ormat to expand the portfolio site by site.
The long-term nature of the contract, with a 15-year term after the final project completes, gives both Ormat and Google forecasting clarity. It assures stable revenue for Ormat and long-duration clean power for Google.
From Climate Pledges to Policy-Backed Power Deals
Google has long pledged to reduce its carbon footprint. It aims to operate on carbon-free energy 24/7 by 2030 across all its data centers and offices. This new geothermal deal aligns with that goal by adding dispatchable clean energy to its power mix.
Geothermal energy can play a key role in meeting this aim because it provides baseload power that complements other renewables like wind and solar. Together, these sources help tech firms reach net-zero goals more reliably.
On the policy side, the extension of federal geothermal tax credits under U.S. law strengthens the economics of geothermal development. Programs such as the Oil and Gas Geothermal Tax Credit (OGBTC) and incentives in the Inflation Reduction Act (IRA) have expanded support for geothermal and other clean technologies.
The Clean Transition Tariff is another policy signal. It creates a scalable structure that utilities in other U.S. markets might adopt. This could help large users, not just Google, secure new clean generation that aligns with climate and reliability goals.
- MUST READ: TotalEnergies and Google’s 1 GW Solar Deal Signals a New Phase in the Data Center Energy Race
Tech Giants Turn to Deep Earth Energy
The Ormat–Google deal fits a broader industry trend. As demand for reliable, low-carbon power grows, more tech and cloud companies seek direct ties to physical clean energy projects.
Tech giants signed 14 geothermal PPAs totaling 635 MW in 2025 alone, up 3x from 2024. Data centers now drive 60% of new geothermal capacity, targeting 120 GW by 2050, per DOE’s forecast.
One example is Switch, a major data center operator that signed a 20-year Power Purchase Agreement (PPA) with Ormat to supply about 13 MW of geothermal power from the Salt Wells plant in Nevada. That agreement begins energy deliveries around 2030, contingent on upgrades to the facility.
Switch’s PPA also includes an option to add roughly 7 MW of solar PV to support the geothermal site’s auxiliary needs. This hybrid approach supports stability and broader sustainability objectives.
Other tech giants are exploring geothermal and other firm clean energy sources, recognizing that intermittent renewables alone cannot supply constant power for large computing loads. Key deals are:
- Google-Fervo: 115 MW enhanced geothermal (Nevada, online 2026) via NV Energy CTT—Ormat deal doubles Google’s NV commitment.
- Microsoft-ENEL: 120 MW Hellisheidi (Iceland, operational 2026)—world’s largest geothermal data center link.
- Google-Taiwan: 10 MW PPA (operational).
These moves underline a broader shift toward long-term, grid-connected clean power strategies. Grid-tied PPAs signal seismic shift: tech won’t wait for battery breakthroughs.
For Google, geothermal unlocks 24/7 carbon-free baseload when it needs it online: 2028, matching the NV data center expansion phase.
A Blueprint for Future Clean Power Partnerships
The Ormat–Google geothermal deal could serve as a model for future clean power partnerships. If the Nevada Public Utilities Commission approves the agreement in late 2026, the structure may be replicated in other states.
Developers may use similar portfolio PPAs to build geothermal and other clean energy projects. Utilities and policymakers may also adopt clean transition tariffs or flexible frameworks that allow large users to co-finance new clean generation.
For Google, securing scalable clean power helps future-proof data centers against rising energy demand from AI and cloud services. For Ormat, the deal provides long-term revenue and validates its strategy to expand geothermal capacity.
Geothermal energy, once a niche clean source, is gaining traction as a firm, reliable part of the renewable mix. And as digital infrastructure grows, deals like this one show how deep underground heat can power the next wave of cloud and AI computing sustainably.
The post Google Taps Earth’s Heat in 150MW Geothermal Deal with Ormat Technologies to Power Data Centers appeared first on Carbon Credits.
More and more small and medium-sized businesses are hearing the same question from their larger customers: What is your carbon footprint? That question now travels down entire supply chains, and it arrives next to tender requirements, certification criteria, and rising customer expectations.
The accounting differences that decide whether your nature investment shows up in inventory, in BVCM, or nowhere at all.
The question reaches a procurement team about three weeks before the next sustainability committee meeting. Someone has read about insetting. Someone else has just signed off on an offset purchase. The CSO wants to know if the two are interchangeable. The answer is no, and the GHG Protocol Land Sector and Removals Standard is the reason why.
This article walks through what each term means at audit-grade specificity, what the standards actually say about how each gets counted, and how to decide which tool fits which target. The insetting vs offsetting question is one of the most-searched in corporate climate strategy, and one of the most poorly answered. By the end of this piece, you should be able to brief a committee on the difference without notes.
The two definitions, in plain English
Offsetting means buying carbon credits generated outside your value chain and retiring them against your residual emissions. The reduction happens somewhere else, financed by you, and the credit is the receipt.
Insetting means investing in emission reductions or removals inside your own value chain, typically with suppliers, where the reduction is directly linked to the products and services you buy. The reduction happens inside the boundary of your Scope 3 inventory, and the accounting treatment is fundamentally different.
The shorthand from the University of Oxford’s Nature-based Insetting Initiative is useful: insetting is what you do with the supply chain you have; offsetting is what you do with the supply chain you do not have.
What the GHG Protocol Land Sector Standard actually says
The GHG Protocol Land Sector and Removals Standard, finalised in 2024 after a multi-year pilot, sets the rules for how land-based emission reductions and removals enter corporate inventories. The Standard distinguishes between inventory accounting (Scope 1, 2, and 3) and project or intervention accounting (a separate methodology for crediting).
For insetting, the practical implication is that supplier-level interventions, when properly measured and attributed, can reduce your Scope 3 category 1 (purchased goods and services) emissions in your inventory. The reduction is not a credit retired against the inventory; it is a lower inventory number, period.
For offsetting, the credit is retired separately. It can be reported as a contribution toward a net-zero claim under the SBTi Beyond Value Chain Mitigation framework or as part of a VCMI Carbon Integrity claim, but it does not lower the inventory number.
A practical consequence: if your Science Based Target requires a 50% absolute reduction in Scope 3 emissions by 2030, insetting moves you toward the target. Offsetting does not. This single point of difference reshapes the procurement decision.
When insetting counts toward Scope 3 (and when it does not)
Insetting counts toward Scope 3 only when several conditions are met:
- The intervention must occur with an entity in your value chain.
- The emissions reduction or removal must be measured against a defensible baseline.
- The reduction must be attributed to your share of that supplier’s output, not double-counted with other buyers.
- It must follow the inventory accounting rules in the GHG Protocol Land Sector Standard, not the project accounting rules used to generate credits.
The most common failure mode is double counting. If your supplier sells the same reduction as a credit on the voluntary market and also reports it to you as a Scope 3 reduction, the math breaks. The Standard requires you to address this risk, typically by purchasing and retiring the supplier-issued credit as part of your inventory or by contractual provisions that prevent the supplier from selling the reduction twice.
When insetting does not count toward Scope 3: when the intervention sits with a supplier you do not buy from, when the baseline is not defensible, when the attribution is unclear, or when the documentation does not survive audit. Those cases default to Beyond Value Chain Mitigation, which is still useful but operates on a different ledger.
The procurement and supplier engagement question
Insetting is harder than offsetting. That is the unfashionable truth most buyers eventually confront. Offsetting is a transaction; insetting is a relationship.
To run an insetting program, you need supplier mapping precise enough to know which farms or facilities sit at which Scope 3 boundary. You need an engagement model that gets suppliers to participate, which usually requires multi-year commitments and shared economics. You need an MRV architecture that measures the right things and produces audit-ready documentation. And you need a contractual structure that prevents double counting and protects both sides.
The trade-off you receive in return is significant. Reductions count against your inventory rather than your residual. Supplier relationships deepen, which protects sourcing continuity. Yield and quality improvements often follow regenerative interventions, which reduces your input cost over time. And the regulatory file, under CSRD, CSDDD, EUDR, and the SBTi FLAG Guidance, is materially stronger.
Choosing the right tool for the right target
A practical decision rule. If your target is a science-based Scope 3 reduction and you operate in a FLAG sector or source FLAG commodities, insetting is the structurally correct tool. If your target is a net-zero claim that includes neutralising hard-to-abate residual emissions outside your value chain, BVCM via high-integrity offsets is the structurally correct tool. Most companies with material Scope 3 exposure need both, in different proportions, sequenced over time.
The sequencing matters. Insetting takes longer to stand up but produces a permanent reduction in the inventory. Offsetting can be transacted faster but does not change the inventory and now sits under tighter claim restrictions. Treat them as complementary tools with different jobs, not as substitutes. The Accountability Framework Initiative and the IUCN Global Standard for Nature-based Solutions both provide useful guardrails for the insetting side, with biodiversity, human rights, and benefit-sharing requirements that go beyond carbon math.
If you are mapping a Scope 3 reduction roadmap and need to scope which interventions count toward your inventory versus which sit in Beyond Value Chain Mitigation, the carbon and sustainability experts at Carbon Credit Capital can help you structure a nature-based supply chain investment program that fits your FLAG exposure, your target architecture, and your audit horizon. Schedule a consultation.
Net zero is often described as a balancing act: cut what you can, account for the rest, and reach zero on the ledger. That framing is useful, but it leaves something out. It treats every tonne of carbon as interchangeable and every route to zero as equally sound, while the science tells a more specific story.
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