# Geothermal power plants: Correlation Prices it moves with, and why Source page: https://www.materialinsights.org/energy/e_geo_power/correlation/ Geothermal power costs are mostly drilling and wells, with turbines, steam pipes and brine handling. Success depends on finding hot permeable rock; once running, plants have steady output and low fuel costs. Proxy **US PPI: turbines and turbine generator sets** index (BLS base period =100) · monthly, Jun 2011 to Sep 2026 There is no free public price for geothermal power plants itself, so this tab uses the closest public series as a stand-in. Read the numbers as an indication, not as the price of this exact item. #### What its price moves with Selected link ##### Geothermal power plants and Advanced geothermal Monthly changes 0.05 little or none correlation 12-month changes 0.28 weak correlation Last 5 years 0.08 monthly changes Lead or lag +3 mo Advanced geothermal tends to lead by 3 months (r 0.19) Price function, Jun 2011 to Sep 2026 Geothermal power plants ≈ 24.3 × (Advanced geothermal)^0.25 R² 0.09 On this fit, a 10% higher advanced geothermal price goes with a 2.4% higher geothermal power plants price over the long run. Units: index (BLS base period =100) and index (BLS base period =100). The fit is loose, so treat the function as a rough guide. Chart: Geothermal power plants and Advanced geothermal prices rebased to 100 at Jun 2011, log scale Both prices rebased to 100 at Jun 2011, on a log scale so equal percentage moves look the same size. Chart: Geothermal power plants price against Advanced geothermal price, monthly, log scales, with fitted line Each dot is one month; paler dots are older (2011), darker dots recent (2026); the ringed dot is the latest month. The dashed line is the fitted price function. Both axes are logarithmic. Energy [AGS Advanced geothermal](https://www.materialinsights.org/energy/e_adv_geo/)Shared drilling 0.05 Conventional and advanced geothermal both depend on drilling, the largest and riskiest cost. The US drilling index and the turbine proxy show little link, with monthly moves at 0.05 and yearly moves at 0.28. little or none co-movement month to month · 184 months Show charts Energy [ST Steam turbines and thermal power plants](https://www.materialinsights.org/energy/e_steam_turbines/)Main input 0.68 Geothermal plants use steam or binary turbines similar to other thermal plants. The US steam turbine index overlaps the turbine proxy, sharing a manufacturing cycle: monthly moves correlate at 0.68 and yearly moves at 0.53. moderate co-movement month to month · 169 months Show charts Commodity [St Steel](https://www.materialinsights.org/commodities/steel/)Main input 0.05 Well casing and surface pipes use a lot of steel that must resist heat and corrosive brines. The proxy is a US turbine price index shared by several power technologies, so it does not track steel monthly (0.05). little or none co-movement month to month · 184 months Show charts Commodity [H₂O Water](https://www.materialinsights.org/commodities/water/)Resource 0.09 Geothermal plants need water or brine to carry heat, and many reinject it to keep the reservoir going. The US water index is a California market price, which shows local scarcity, not plant costs. little or none co-movement month to month · 96 months Show charts Chemical [OFC Oilfield and mining chemicals](https://www.materialinsights.org/chemicals/oilfield_chemicals/)Process input Drilling muds, cements and scale and corrosion inhibitors come from oilfield chemical suppliers. Brine chemistry makes these chemicals a recurring running cost. Their prices follow oilfield demand, so busy drilling years raise geothermal costs. Not enough overlapping price history to measure. Energy [Gas Natural gas](https://www.materialinsights.org/energy/natural_gas/)Rival source −0.05 Gas plants compete with geothermal for steady power, and high gas prices improve the case for new wells. The turbine proxy does not follow gas, with monthly moves at -0.05. little or none co-movement month to month · 184 months Show charts How to read these numbers **Correlation of monthly changes** (the number in the coloured pill) compares how much each price moved, month by month, since 2006 or the first month both series exist. It runs from −1 to +1: near +1 the two usually rise and fall in the same months, near 0 there is no link, and a negative number means they tend to move in opposite directions. Above 0.7 is strong, 0.4 to 0.7 moderate, 0.2 to 0.4 weak. **12-month changes** compare year-on-year moves, which shows whether two prices share the same cycles even when the month-to-month noise differs. **Price function** is a straight-line fit of the two prices on logarithmic scales: price ≈ k × (partner price)^β. β is how much this price moves, in per cent, for a 1% move in the partner over the whole period, and R² is the share of the variation the fit explains. Two prices that both drift up with inflation can fit well without any real link, so read it together with the monthly correlation. **Lead or lag** checks whether the monthly correlation is clearly higher when one price is shifted by 1 to 6 months. Correlation is not cause. The reasons on each card explain the economic link; the numbers show how strongly it has shown up in prices. Proxy series are US producer price indexes or related prices and can blur the real link. Data: World Bank Commodity Price Data (Pink Sheet), October 2026; US Bureau of Labor Statistics producer price indexes, IMF primary commodity prices and US EIA prices via FRED, Federal Reserve Bank of St. Louis, retrieved November 2026. Calculations by this site. ## Other sections - [Summary](https://www.materialinsights.org/energy/e_geo_power/index.md) - [Overview](https://www.materialinsights.org/energy/e_geo_power/overview/index.md) - [Efficiency](https://www.materialinsights.org/energy/e_geo_power/efficiency/index.md) - [Techniques](https://www.materialinsights.org/energy/e_geo_power/techniques/index.md) - [Resources and labour](https://www.materialinsights.org/energy/e_geo_power/resources/index.md) - [Impact on the biosphere](https://www.materialinsights.org/energy/e_geo_power/biosphere/index.md) - [Relationships](https://www.materialinsights.org/energy/e_geo_power/links/index.md)