A Turning Point for the Caribbean Energy Transition
The Caribbean continues to face escalating energy insecurity. This is due to volatile fuel prices. It is also because of a heavy reliance on imported fossil fuels. This dependency undermines energy resilience and economic stability across island states. As the region accelerates its clean energy transition, there is a pressing need for reliable baseload power. Geothermal energy, with its abundant potential and ability to deliver stable, low-emission electricity, is emerging as a key solution. Recent developments include a US$34.8 million loan by the Caribbean Development Bank (CDB) for Dominica’s 10 MW geothermal power plant. These developments show increased focus on geothermal energy projects in the Caribbean.
The Geothermal Potential of the Caribbean Basin
Geological Advantages of Volcanic Islands
The volcanic arc of the Eastern Caribbean presents ideal conditions for geothermal development. High-enthalpy resources are concentrated in Dominica, Saint Lucia, Nevis, Saint Vincent, and Montserrat. These islands sit atop active tectonic zones with accessible geothermal reservoirs. Advanced Geo-scientific studies and exploratory drilling—particularly in Dominica and Nevis—have confirmed commercially viable resources. Ongoing mapping initiatives, supported by the GEOBUILD Program and international partners, are refining resource models and guiding investment decisions. As interest in Caribbean geothermal energy accelerates, these volcanic islands are in a strategic position. They are leading the regional transition to clean and resilient baseload power.
OECS and Non-OECS Country Readiness Levels
Geothermal development in the Caribbean reflects varying degrees of progress across both OECS and non-OECS states. Dominica and Nevis lead the OECS region with proven resources and near-term plans for power plant commissioning. Saint Vincent and Montserrat are advancing with exploratory activities, while Saint Lucia and Grenada remain in early-stage assessments. Outside the OECS, Guadeloupe is a notable leader, operating the Bouillante geothermal plant for over two decades. Haiti and Saint Kitts are exploring potential, though institutional and financial barriers persist. This diversity in readiness underscores the need for tailored support to scale up Caribbean geothermal energy deployment.
Regional Cooperation: Unlocking Cross-Border Synergies
Geothermal energy development in the Caribbean is strengthened through regional collaboration, particularly among OECS Member States. By pooling technical expertise, harmonizing policies, and investing in shared infrastructure, countries can reduce development risks and improve project viability. Caribbean geothermal energy initiatives increasingly emphasize cooperation to maximize limited resources and attract coordinated financing from development partners.
The GEOBUILD Program and Its Regional Impact
The OECS-led GEOBUILD Program is central to advancing geothermal energy in the Eastern Caribbean. It focuses on strengthening policy frameworks, streamlining permitting processes, and establishing environmental and social safeguards. Technical assistance under GEOBUILD enhances the institutional capacity of national energy agencies and promotes standardized geothermal legislation. Workshops, peer exchanges, and regulatory toolkit are creating a skilled regional workforce. These efforts are fostering alignment across jurisdictions. This paves the way for a more integrated geothermal market.
Interconnection and Shared Infrastructure Models
The Caribbean’s island geography presents unique challenges, but also opportunities for innovative cross-border energy solutions. Sub-sea electrical interconnections between geothermal-rich islands and nearby demand centers could allow resource sharing and load balancing. A regional power pool would enable economies of scale, making geothermal investments more attractive. Coordinated development of transmission infrastructure reduces redundancies, supports energy security, and enhances resilience to climate impacts.
Financing the Future: Investment Trends and Opportunities
Unlocking the full potential of Caribbean geothermal energy requires significant upfront investment and sustained financial support. Development partners and regional financial institutions are crucial for bridging early-stage funding gaps. They help de-risk projects and build confidence among private investors. As the Caribbean advances toward a clean energy future, strategic financing is key to moving projects from exploration to generation.
Role of the Caribbean Development Bank (CDB) and Development Partners
The Caribbean Development Bank (CDB) has been instrumental in supporting geothermal energy through technical assistance, feasibility studies, and concessional financing. CDB’s interventions have helped de-risk exploration in Dominica, Saint Lucia, and Saint Vincent. Strategic co-financing partnerships have expanded access to capital. These partnerships include the Global Environment Facility (GEF). They also involve the Inter-American Development Bank (IDB). Additionally, they include the EU-Caribbean Investment Facility (EU-CIF) and the World Bank. They have also mobilized technical expertise. These collaborations have facilitated access to necessary resources and knowledge. These partnerships have catalyzed regional geothermal initiatives.
De-risking Mechanisms and Blended Finance Solutions
Geothermal development is capital-intensive and risk-laden, particularly during the resource exploration phase. To attract private sector participation, financing frameworks are increasingly integrating risk mitigation tools. These tools include exploration risk insurance, partial credit guarantees, and concessional capital. Public-Private Partnership (PPP) models are being tailored to the geothermal context. These models enable risk-sharing arrangements that align with investor requirements. They also safeguard public interests. These blended finance solutions are vital for scaling up geothermal investments across the region.
Innovation Driving Progress
Technological innovation is accelerating the deployment of geothermal energy across the Caribbean. New tools and applications are making exploration more precise. They are reducing costs and opening the door to diversified energy uses beyond electricity generation. For island economies seeking resilience and efficiency, these advances are critical to realizing the full potential of Caribbean geothermal energy.
Technological Advances in Geothermal Exploration
Innovative technologies are revolutionizing geothermal project development. Remote sensing and 3D subsurface imaging enhance the accuracy of resource identification, reducing the need for exploratory drilling. Modular well drilling techniques allow for scalable development, tailored to the unique geography of each island. These advances not only cut development timelines but also significantly lower capital costs—making geothermal more accessible to Caribbean nations.
Integrated Applications: District Heating and Industrial Use
Beyond electricity, geothermal energy can serve as a direct heat source for various sectors. District heating systems in urban areas, thermal desalination, greenhouse agriculture, and Agro-processing are practical applications. For tourism-driven economies, geothermal spas and hot water systems offer additional value streams. Leveraging these integrated uses boosts return on investment and supports climate-resilient development strategies in the Caribbean.
Breaking Down the Barriers
Despite its promising potential, geothermal development in the Caribbean faces persistent structural and institutional hurdles. These include fragmented regulations, skills shortages, and slow permitting processes. Coordinated reforms and capacity building are crucial. These actions will help advance Caribbean geothermal energy. They will also help realize its regional benefits.
Regulatory, Institutional, and Capacity Challenges
Many Caribbean nations lack dedicated geothermal legislation, resulting in regulatory uncertainty that hampers investor confidence and project timelines. Permitting frameworks are often outdated or misaligned with the technical complexities of geothermal development. Additionally, there is a limited pool of local Geo-scientists, engineers, and regulatory experts. This shortage leads to prolonged project preparation and implementation delays. These issues are exacerbated in smaller island states with constrained institutional capacity.
Recommendations for Policy and Institutional Reform
To overcome structural challenges, Caribbean countries must prioritize geothermal-specific regulatory frameworks. Model regulations, like those being developed under the GEOBUILD initiative, can provide clear guidelines for permitting, licensing, and environmental oversight. Creating regional training hubs is essential. The proposals under the CDB’s 2024–2026 Technical Cooperation Strategy aim to build technical capacity. They also intend to standardize skills across the region. A shared digital knowledge platform can further support technical exchanges, maintain best practice libraries, and provide transparent project performance metrics.
The Way Forward – A Coordinated, Climate-Resilient Approach
Caribbean geothermal energy development must align with broader climate goals while embracing regional cooperation and inclusive growth. As nations implement their Nationally Determined Contributions (NDCs), geothermal energy offers a pathway to achieve low-carbon, climate-resilient economies. By scaling innovation and sharing benefits across borders, the Caribbean can create a unified approach to sustainable energy transformation.
Aligning with Nationally Determined Contributions (NDCs)
Geothermal energy plays a crucial role in fulfilling Caribbean countries’ NDCs under the Paris Agreement. According to the UNFCCC NDC Registry (2024 update), all Caribbean SIDS have committed to reducing GHG emissions. They aim to achieve a reduction of 30–70% by 2030. Caribbean SIDS have set goals to cut GHG emissions by 30–70% by 2030. These commitments are aimed at significant emission reductions. Projects like Dominica’s 10 MW geothermal plant are expected to displace over 35,000 tonnes of CO₂ annually. This contributes significantly to these targets. Integrating geothermal into national climate and energy strategies ensures long-term policy continuity. It also ensures funding eligibility under global climate finance mechanisms.
Building a Caribbean Geothermal Alliance for 2030
A regional Caribbean Geothermal Alliance (CGA) could serve as a structured mechanism for collaborative policy-making, infrastructure co-investment, and technical exchange. Backed by OECS, CARICOM, and key development partners, the CGA would support shared project pipelines. It would ensure donor alignment and centralized procurement to reduce costs. This approach aims to maximize impact. In early 2025, discussions began under the CARICOM Energy Program. They focused on exploring CGA’s institutional design, governance, and funding structure. A formal launch is expected by early 2026.
Scaling Innovation with Equity, Resilience, and Shared Prosperity
Energy transition strategies must prioritize inclusive development. According to IRENA’s 2024 “Gender in Energy” brief, only 32% of the renewable energy workforce in the Caribbean is female. Even fewer women hold senior technical roles. Policies must support gender-responsive project design and ensure benefits extend to vulnerable communities. Geothermal-based local enterprises—such as heating for Agro-processing or tourism services—can drive micro-economic resilience and community ownership of clean energy solutions.
✅ Key Takeaways!
- Baseload Power Advantage. Geothermal offers the only renewable, non-intermittent power source suitable for Caribbean energy baseload needs.
- Leading Geothermal Projects. Dominica is a regional leader with 10 MW. Nevis has a planned 10 MW power plant. There is a proposed expansion of 30 MW, which brings the total potential capacity to 40 MW. Bouillante (Guadeloupe) has 15 MW operational.
- Financing Pipeline. More than USD 100 million has been mobilized across the region. This has been achieved via blended finance platforms with CDB, GEF, IDB, and World Bank.
- Cooperation Trend. Regional models like GEOBUILD and the proposed Caribbean Geothermal Alliance promote harmonized, cost-effective deployment.
- New Regional Initiative. The World Bank approved the Caribbean Resilient Renewable Energy Infrastructure Investment Facility in April 2025. The new regional initiative was developed with the Eastern Caribbean Central Bank. It is intended for Eastern Caribbean countries (Grenada, Saint Lucia, and Saint Vincent and the Grenadines). Additional countries have the option of joining over time. The initiative aims to accelerate the uptake of clean, resilient, and affordable energy systems.
- Climate Synergy. Geothermal is a cornerstone for achieving NDC targets while enhancing energy resilience and local economic empowerment.
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📺 YouTube Videos!
🎥 A Turning Point for Caribbean Energy Transition
Geothermal Energy: Dominica’s Clean Power Journey. This video explores Dominica’s efforts to harness geothermal energy for a sustainable future.
🌋 Geological Advantages of Volcanic Islands
Dominica: A High Geothermal Potential. An overview of Dominica’s geothermal resources and potential.
🏝️ OECS and Non-OECS Country Readiness Levels
Exploring the Caribbean’s Geothermal Wealth. A discussion on the geothermal potential across Caribbean nations.
🛠️ The GEOBUILD Program and Its Regional Impact
GEOBUILD: Did You Know More Than Electricity. Insights into the GEOBUILD program’s role in advancing geothermal energy.
🔌 Interconnection and Shared Infrastructure Models
Island Interconnection as a Foundation for Energy Resilience. Exploring the benefits of interconnected energy grids in the Caribbean.
💰 Role of the Caribbean Development Bank (CDB) and Development Partners
Powering a Resilient, Sustainable Caribbean with SuRGE! An overview of the SuRGE initiative by the Caribbean Development Bank.
🛡️ De-risking Mechanisms and Blended Finance Solutions
Region Urged to Tap Billions in Financing for Sustainable Energy. A discussion on financing opportunities for sustainable energy projects in the Caribbean.
🔬 Technological Advances in Geothermal Exploration
Next Generation Geothermal Technologies. An exploration of cutting-edge geothermal technologies.
🌡️ Integrated Applications – District Heating and Industrial Use
Powering Agri-food Value Chains with Geothermal Heat. Demonstrating the use of geothermal energy in agriculture.
⚖️ Regulatory, Institutional, and Capacity Challenges
Enabling Policies and Regulatory Frameworks for Geothermal Power. Insights into policy frameworks supporting geothermal energy.
🌍 Recommendations for Policy and Institutional Reform
Caribbean Cooperation for Fostering Energy Transition. A look into collaborative efforts for energy transition in the Caribbean.
🚀 The Way Forward – A Coordinated, Climate-Resilient Approach
The Future of Geothermal Energy. Exploring the potential and future of geothermal energy globally.
🌐 Online Resources!
- Caribbean Development Bank (CDB) Energy Sector Strategy
- GEOBUILD Programme (OECS Commission)
- World Bank Geothermal Energy Projects in the Caribbean
- CARICOM Energy Knowledge Hub – Geothermal
- IRENA: Renewable Energy Market Analysis – Latin America and the Caribbean
- Dominica Geothermal Development Company
- Bouillante Geothermal Plant – Guadeloupe
- Government of Saint Vincent – Energy Unit Geothermal Project
- Saint Lucia National Energy Transition Strategy (NETS)
- Nevis Renewable Energy Department – Nevis Island Administration
- Montserrat Geothermal Project (MUL)
- World Bank – Caribbean Regional Energy Market Integration
- IRENA – Caribbean Renewable Energy Infrastructure Planning
- CARICOM Energy – Regional Policy Frameworks
- GEF Projects in the Caribbean – Geothermal Energy Focus
- World Bank – Supporting Geothermal Development in the Caribbean
- IDB Sustainable Energy Initiatives
- EU-Caribbean Investment Facility (EU-CIF)
- IRENA – Risk Mitigation Instruments for Geothermal Energy
- International Geothermal Association – Technology Trends
- U.S. Department of Energy – Geothermal Technologies Office
- GeoVision Study – Technical Pathways and Innovations
- World Bank – Geothermal Direct Use Opportunities in Small Island States
- CEKH – Caribbean Applications of Geothermal Energy
- IRENA – Geothermal Regulatory Framework Guidelines
- CDB – Climate Resilience Strategy 2022–2026
- IRENA – Planning and Policy Tools for Small Island Developing States (SIDS)
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