Community-owned geothermal development models are joint structures in which local residents, landholders, or resource-rights owners share ownership and/or governance with a professional project developer. These models can be implemented through a jointly owned Special-Purpose Company (SPC), or through a community-owned company that outsources development and operations. The defining feature is that the community retains rights to the lands and wells and has meaningful influence over decision-making, investment, operations, and long-term revenue allocation. 

Conventional geothermal development is typically led by commercial developers, with local communities and landowners merely selling their land during the project’s initial stages. The community ownership models differs in that authority and ownership remain with the original owners – the local communities and landowners. Traditional projects may encounter social acceptance challenges, slower permitting and limited local benefit flows. In contrast, community-owned models embed shared governance, transparent financial structures and reinvestment mechanisms that can strengthen trust, improve permitting efficiency and expand local economic value. This supports broader rural development and long-term project stability alongside firm clean energy deployment. 

Main outcomes of the solution 

• Reliability & Flexibility: Provides firm, weather-independent renewable heat and power that stabilizes supply and reduces reliance on fossil peaking assets. 
• Affordability: Supports lower long-run system costs by adding high-capacity-factor baseload generation and enabling efficient utilization of co-produced heat across local industries. 
• Socioeconomic Impact: Expands equitable energy access and regional economic development through a locally-led structure that optimizes ownership and usage rights, reinvestment of profits, and job creation in geothermal operations, thermal utilization, and regional tourism. 

Key deployment and scaling factors 

1. Establish clear governance and equity structures that guarantee community representation and long-term benefit-sharing from the outset.
2. Deploy targeted public risk-mitigation tools (e.g. exploration guarantees and contingent grants) to address early-stage geothermal drilling risk and attract private capital. 
3. Secure bankable revenue streams through long-term electricity and heat off-take agreements that stabilize cash flow for both community and developer. 
4. Integrate direct-use heat applications (agriculture, agro-processing, district heating, tourism) to strengthen local economic value and improve overall project economics. 
5. Apply transparent digital monitoring and reporting systems that give community shareholders visibility into production, revenues and reinvestment flows. 

Case Study

Baseload Capital and Furusato Netsuden (2011), Japan

The Waita Model is a community-centred geothermal development approach that formalises shared ownership between local landholding stakeholders and a professional developer.  

The model was developed in connection with the establishment of the 2 MW Waita No. 1 Power Plant in Oguni Town, Kumamoto Prefecture. In 2011, a community-owned limited liability company, Waita-kai, was formed and outsourced the operation of the power plant to the developer Furusato Netsuden. Waita No. 1 began commercial operations in 2015. 

Through recurring meetings, representatives of Waita-kai and Furusato Netsuden share information and make joint decisions regarding power plant operations, development activities, and budget allocation. 

The 5 MW Waita No. 2 Power Plant, scheduled for commissioning in 2026, was established via a Special-Purpose Company (SPC) where Furusato Netsuden is the sole shareholder. However, Waita-kai retains the rights to the lands and wells and plans to operate the plant in line with the principles applied at Waita No. 1, including revenue distribution and information sharing. 

The Waita Model is thus based on two power plants in which local land remains in the hands of its original owners, and the rights to the wells drilled there are held by the local community. 

The model also enables geothermal heat to be used for local greenhouses, household hot water, food processing, tourism facilities, and wood drying – aiming to diversify income streams and strengthen local economic resilience. 

Operational progress demonstrates the model’s viability. A 30 MW+ pipeline of additional sites is planned across several regions, applying similar governance and development principles. With only a small share of Japan’s 23 GW geothermal potential currently developed, the Waita Model illustrates how structured community participation and benefit-sharing mechanisms can support socially accepted, scalable geothermal deployment aligned with national clean energy objectives.[1,2,3]

References: 

1. Global-local alliance powers a new era in Japan’s geothermal energy I Baseload Capital (September 2025) 
2. Geothermal energy for the People, by the People I Baseload Capital (October 2025)  
3. Furusato Netsuden Company Website