The Puga Valley geothermal project in Ladakh marks a major milestone in India’s clean-energy journey.

Why in the News?

On 17 July 2026, the Lieutenant Governor of Ladakh, V. K. Saxena, commissioned two geothermal wells drilled by the ONGC Energy Centre at Puga Valley. Each well reaches a depth of 1,000 metres at an altitude of more than 14,000 feet. The wells are intended to support reservoir evaluation and planning for a 1 MW pilot plant, described by the Ladakh Administration as India’s first demonstration-scale geothermal power project.

Puga Project: Key Facts at a Glance

What is Geothermal Energy?

Geothermal energy is heat stored within the Earth’s crust. This heat comes mainly from residual heat associated with the planet’s formation and the continuing radioactive decay of elements within the Earth. Temperature generally rises with depth; this rate of increase is called the geothermal gradient. Where the gradient is unusually high, useful temperatures may be available at relatively shallow depths.

A conventional hydrothermal system needs three elements: heat, fluid, and permeability. Groundwater moves through fractures in hot rock, absorbs heat, and may emerge as hot water or steam. Wells bring the heated fluid to the surface, where it can generate electricity or be used directly. After heat extraction, reinjection can return the cooled fluid underground, helping maintain reservoir pressure and limiting surface discharge.

How Geothermal Electricity is Generated

Beyond Electricity: Direct Uses

• Space and district heating: Hot water can heat buildings, campuses, and settlements.
• Agriculture and food systems: Greenhouse heating, crop drying, cold storage, food processing, and aquaculture.
• Industry and public services: Process heat, desalination, bathing facilities, wellness tourism, and geothermal parks.
• Ground Source Heat Pumps (GSHPs): Shallow ground temperatures are used as a heat source in winter and a heat sink in summer; this application does not require a high-temperature volcanic resource.

Why Geothermal Energy Matters

• Firm, round-the-clock power: Geothermal output is not dependent on sunshine or wind speed and can support grid stability.
• High utilisation: The IEA reported an average global geothermal utilisation rate above 75% in 2023, compared with below 30% for wind and below 15% for solar PV.
• Low lifecycle emissions: Well-managed geothermal systems provide low-emission electricity and heat without continuous fuel combustion.
• Remote-area energy security: Site-specific projects can reduce dependence on long transmission lines and transported fuels in Himalayan and island regions.
• Small land footprint: Geothermal plants generally require less surface area per unit of continuous power than many diffuse renewable sources.
• Complements solar and wind: Firm geothermal power can balance variable renewable generation and reduce storage requirements.
• Oil and gas synergies: Drilling skills, subsurface data, equipment, and selected abandoned wells can be repurposed for geothermal development.
• Employment and local value chains: Exploration, drilling, reservoir management, construction, and direct-use industries can create skilled jobs.

Limitations and Environmental Concerns

• High upfront cost and exploration risk: A commercially useful reservoir may not be confirmed until expensive drilling is completed.
• Site specificity: Conventional resources are concentrated in particular geological settings.
• Induced seismicity: Reservoir stimulation and reinjection can trigger small earthquakes if not carefully managed.
• Water and fluid management: Projects must prevent contamination, manage mineral-rich brines, and prefer reinjection.
• Reservoir decline: Excessive withdrawal can reduce pressure or temperature; long-term monitoring is essential.
• Corrosion and scaling: Dissolved minerals can damage wells, pipes, and heat exchangers.
• Fragile ecosystems: Projects in Ladakh and the Himalaya require rigorous environmental and social assessment because of biodiversity, water scarcity, cultural landscapes, and limited carrying capacity.
• High-altitude logistics: Extreme weather, rugged terrain, a short working season, and grid connectivity can raise costs at Puga.

India’s Geothermal Potential

The Geological Survey of India (GSI) has studied 381 thermally anomalous areas and estimated India’s theoretical geothermal power potential at about 10,600 MW. The National Policy on Geothermal Energy, 2025 identifies ten geothermal provinces: Himalayan, Naga-Lusai, Andaman-Nicobar, Son-Narmada-Tapi (SONATA), West Coast, Cambay Graben, Aravalli, Mahanadi, Godavari, and South Indian Cratonic.

India’s Himalayan resources may reach reservoir temperatures of around 200°C, whereas much of the rest of the country lies in medium- to low-enthalpy zones. This makes a technology-neutral approach important: electricity generation may suit the hottest fields, while direct heat, GSHPs, binary plants, EGS/AGS, and reuse of oil and gas wells may be more appropriate elsewhere.

Major Potential Sites Identified by MNRE

Source: National Policy on Geothermal Energy, MNRE, 15 September 2025. Spellings follow the official policy.

National Policy on Geothermal Energy, 2025

MNRE notified India’s first National Policy on Geothermal Energy on 15 September 2025. The policy seeks to make geothermal energy a meaningful part of India’s renewable energy mix, support the Net Zero 2070 commitment, and improve energy security.

• Research and resource assessment: Improved exploration, drilling, reservoir management, data repositories, and standardised assessment.
• Technology development: Support for dry steam, flash, binary and Organic Rankine Cycle plants; EGS/AGS; hybrid geothermal-solar systems; closed loops; energy storage; and deep direct use.
• Direct-use applications: Heating and cooling, greenhouses, food processing, aquaculture, cold storage, desalination, and geo-tourism.
• Oil and gas integration: Repurposing inactive wells, using industry data and expertise, and forming joint ventures.
• Investment ecosystem: 100% FDI in renewables, exploration-risk sharing, concessional finance, green bonds, viability-gap funding, and other mechanisms subject to approvals.
• State-level facilitation: Exploration permits, land leases, single-window clearances, and coordination with central agencies.
• Environmental safeguards: Preference for safe handling and reinjection of geothermal fluids and possible dedicated environmental and social impact guidelines.
• Pilot approach: Five pilot and resource-assessment projects were sanctioned as an initial step.

Special Relevance for Himachal Pradesh and HPAS

Himachal Pradesh lies within the Himalayan geothermal province and the national policy specifically lists Manikaran, Kasol, Tattapani, and Tapri as potential sites. For HPAS, geothermal energy should therefore be studied not merely as a national renewable-energy topic but as a state development issue.

• State geography: Link geothermal manifestations with tectonic activity, fault zones, hot springs, and the Himalayan geological setting.
• Decentralised energy: Small projects and direct heat could support remote settlements, public buildings, tourism facilities, and horticultural value chains.
• Horticulture: Greenhouse heating, drying, food processing, and cold storage may offer more immediate value than electricity generation at medium-temperature sites.
• Tourism and wellness: Hot-spring destinations such as Manikaran and Tattapani offer geo-tourism potential, but carrying capacity, river ecology, waste, and cultural sensitivity must be addressed.
• Disaster and environmental governance: Any project must consider landslide risk, seismicity, groundwater interaction, forest and wildlife clearances, and cumulative ecological impacts.
• Policy lesson: Himachal Pradesh can begin with detailed resource mapping and low-risk direct-use pilots before scaling to power generation.

Global Context

Global geothermal power capacity stood at 15.4 GW at the end of 2024, led by the United States, Indonesia, and the Philippines. The International Energy Agency estimates that, with technological progress and cost reductions, geothermal could meet up to 15% of global electricity-demand growth to 2050. The IEA also notes that up to 80% of geothermal project investment involves capabilities shared with the oil and gas industry, underlining the importance of companies such as ONGC.