Which States Are Next for Geothermal GRECs? The 2025 Legislative Outlook
As of early 2025, active and mature GREC programs are operational in Maryland, Virginia, and New Hampshire, providing significant financial returns for geothermal system owners in those regions. However, the market is rapidly expanding; Pennsylvania is currently the frontrunner for new growth as it advances HB 501 toward elevating geothermal energy to Tier I renewable status. Beyond Pennsylvania, other states with active or pending geothermal RPS legislation include New York, New Jersey, Massachusetts, and Illinois. States with high geothermal adoption rates and existing Renewable Portfolio Standard (RPS) frameworks are the most likely to be the next major adopters of thermal credit markets. This legislative trend highlights a growing national recognition of geothermal as a primary tool for decarbonization.
The Current Landscape: MD, VA, and NH
Three states currently provide the foundation for the Mid-Atlantic and New England GREC markets. Maryland leads with HB 1007, creating a market where credits have traded for as high as $87/MWh through the PJM-GATS registry. Virginia's SB 508 established a ceiling price for its Alternative Compliance Payment (ACP) at $45/MWh, creating a stable but different market dynamic. New Hampshire operates within its Class I RPS requirements, with credits tracked through the NEPOOL-GIS system and averaging roughly $27/MWh in recent trading cycles. Each of these three states has distinct eligibility requirements regarding system age, COP ratings, and mandatory ENERGY STAR certification. These active regions provide a successful blueprint that Emergent Energy Solutions actively serves and monitors daily. For a deep dive into each state's current pricing and rules, visit our /states and /maryland pages.
Pennsylvania: The Next Major GREC Market
Pennsylvania's PRESS Act (HB 501) represents the most significant and advanced pending legislation in the United States for geothermal incentives. The bill cleared the House Environmental Resources and Energy Committee in June with unanimous bipartisan support, signaling a strong political will to modernize the state's Alternative Energy Portfolio Standards (AEPS). If passed, the bill would move geothermal energy from Tier II to Tier I, drastically increasing the demand and value of the credits. The proposed legislation includes an ACP ceiling of $35/MWh, which would create a meaningful and consistent revenue stream for Pennsylvania's thousands of existing geothermal system owners. Full enactment and program launch could occur as early as the end of 2025 or early 2026. Stay updated on our /states page for the latest Pennsylvania legislative alerts.
States to Watch: NY, NJ, and MA
Several other Northeastern and Midwestern states are currently exploring the implementation of geothermal-specific RPS provisions to meet their aggressive climate goals. New York has seen high-level discussions regarding the inclusion of geothermal thermal RECs in its Climate Leadership and Community Protection Act (CLCPA) implementation. New Jersey's state energy master plan has explored thermal REC programs as a way to incentivize the electrification of heating. Massachusetts already possesses an existing thermal RPS framework that could see significant expansion or higher credit values assigned specifically to ground-source heat pumps. Illinois is also a state of interest, where legislative sessions have seen the introduction of various renewable thermal incentives. While these programs are at different stages of the legislative lifecycle, they represent a massive potential expansion of the GREC market. Check our /evaluate page if you live in these states to join our 'notify me' list.
What Makes a State GREC-Ready?
The creation of a functional GREC market typically requires four specific pillars: an established Renewable Portfolio Standard (RPS), a dedicated geothermal carve-out or Tier I classification, an Alternative Compliance Payment (ACP) mechanism to anchor the credit's value, and a robust tracking registry. For states in the Mid-Atlantic and Midwest, the PJM-GATS infrastructure is the preferred tracking choice, while New England states utilize the NEPOOL-GIS registry. Because these tracking platforms already exist for solar and wind, it is relatively easy for states to add a geothermal module once the legislation is signed into law. This existing infrastructure significantly lowers the administrative barrier for new states to launch programs. For a more technical explanation of how these registries function, visit our /how-it-works page or read our /glossary for definitions on RPS and ACP.
The Strategic Role of Emergent Energy
Emergent Energy Solutions maintains a dedicated legislative monitoring team that tracks geothermal and renewable energy bills across all 50 states. We provide expert testimony and data to policy makers to help them understand how GREC markets can drive geothermal adoption and create local jobs. For homeowners in emerging states, we offer a pre-registration service that allows you to get your documentation in order before a program officially goes live. This ensures you are first in line for certification, often allowing you to capture retroactive credits for systems installed while the law was being debated. Visit our states page for current program comparisons or use our /calculator to see what your potential revenue could be if your state adopts a Maryland-style program. We are committed to expanding the financial benefits of geothermal energy to as many homeowners as possible.
Federal Policy Synergy in 2025
While state-level GRECs are the primary focus, 2025 also marks a significant period for federal synergy with the Inflation Reduction Act (IRA) incentives. The 30% federal tax credit remains fully active and can be combined with state GREC revenue to create a powerful financial package for any geothermal project. Furthermore, the Greenhouse Gas Reduction Fund is starting to deploy capital to state green banks, which may use GREC revenue as a form of loan collateral for LMI families. This intersection of state-level carbon markets and federal tax policy is creating the most favorable economic environment for geothermal energy in history. Understanding how to 'stack' these incentives is vital for maximizing your ROI. You can find more information on incentive stacking in our /faq section or by contacting our consultation team.
Anticipating Market Growth and Stability
As more states join the GREC ecosystem, we anticipate a more liquid and stable market for renewable thermal credits. Regional cooperation between states in the PJM territory could eventually lead to cross-state credit trading, which would further protect the value of your GRECs. For investors and commercial property owners, this geographic expansion reduces the risk associated with any single state's legislative changes. Geothermal energy is unique because it provides baseload thermal energy, making it highly valuable to utilities that are struggling to manage grid stability with intermittent solar and wind. This fundamental value ensures that GRECs will remain a key part of the American energy landscape for decades to come. To see how your system fits into this growing market, start our free assessment on the /evaluate page today.