Meta, XGS Energy announce plans to build geothermal site in New Mexico

XGS Energy and Meta Platforms Inc. announced Thursday plans to build a geothermal power plant in northwestern New Mexico, aiming to jumpstart the state’s geothermal industry as tech companies seek new energy sources for data centers and artificial intelligence growth.

The announcement is the next step in New Mexico’s development of renewable energy sources like wind, solar and hydrogen. It also comes the same day that Project InnerSpace, a Geothermal advocacy group, released a 238-page report, “The Future of Geothermal in New Mexico,” touting the state’s potential for geothermal development.

Research from Goldman Sachs earlier this year projected there would be a 165% demand growth for data center power by 2030, according to the report. This makes New Mexico a good fit, with its 163 gigawatts of geothermal development potential, the report added.

“This is an area where geothermal has never been contemplated before, and again, speaks to the value that our technology in particular unlocks,” XGS CEO Josh Prueher said in an interview with the Journal. “It’s close to Albuquerque, Santa Fe, supporting economic development, data center load growth there.”

As the AI race heats up, so too has energy consumption. Open AI has invested in solar power, battery and carbon capture technologies. Both Google and Microsoft are investing in nuclear energy.

XGS and Meta plan to develop the power plant in two phases and aim to complete the project by 2030, though they could finish it as early as 2028, officials said. Meta and XGS declined to comment on an exact location, but said the project is valued at up to $1.2 billion.

If built, the power plant would support 150 megawatts of geothermal energy, drawn from heat produced in the Earth’s interior. It would also become the second geothermal power plant in New Mexico, joining the Lightning Dock in Hidalgo County.

XGS estimates the project will support up to 3,000 trade workers on site at peak construction and create up to 100 long-term operational roles once completed.

XGS’ technology, which the company said enables geothermal power production with zero operating water use, will connect to the Public Service Company of New Mexico’s electric grid and support Meta’s data center operations in Los Lunas.

The company in the news release didn’t say if the site would power any of Meta’s other data centers across the country, or if they plan to build more centers outside of Los Lunas.

“Any future development will be based on business needs. We are not announcing anything additional this week,” Meta spokesperson Ashley Settle wrote in an email.

Meta has made various investments in powering its data centers as the company looks to gain a foothold in the AI race. Bloomberg News reported Thursday that Meta finalized a $14.3 billion investment in Scale AI.

Meta is also growing its AI presence in New Mexico. The company plans to expand its Los Lunas location with two new buildings that would house “next-generation data center facilities to support current products and enable future generations of AI hardware,” according to the Valencia County News-Bulletin, a sister publication of the Journal, citing an industrial revenue bond resolution approved by the Los Lunas Village Council earlier this year.

Data centers are part of Meta’s global infrastructure that power its technologies and services like Facebook, Instagram, Threads, Messenger, Meta Quest and WhatsApp.

Urvi Parekh, Meta’s head of global energy, said part of the tech company’s desire is to support the continued growth and resilience of electric grids through clean, firm power. Geothermal energy fits that bill.

“We have a responsibility to address climate change, to lower our carbon footprint — but we also need the power,” Gov. Michelle Lujan Grisham said at a Thursday news conference announcing the deal.

Geothermal energy aimed at supporting data centers is a new development for Meta, which last year announced a partnership with Sage Geosystems at a U.S. Department of Energy geothermal workshop.

Jackson Grimes, Project InnerSpace director of global engagement, said the group’s research into New Mexico’s geothermal potential began in 2023. The report explains how a combination of subsurface heat abundance, oil and gas expertise and political support positions the state to rapidly expand geothermal development.

There are no limitations to what geothermal energy can power, Grimes said, from climate control for vaccine production to providing neighborhoods with electricity.

“Solar and wind are fantastic, definitely part of the future of energy, but the problem is the sun only shines so often and the wind only blows so much,” said Grimes, who edited the geothermal report released Thursday. “Geothermal, once you start the system, you’re going to have 90% capacity factor and efficiency for the entire time the project is running.”