CAMBRIDGE, Mass. — The nation could generate much of the electricity it will need in the future by tapping heat energy locked in hard rock below the Earth's surface, a study commissioned by the U.S. Department of Energy concluded yesterday.

Heat mining could supply energy at competitive prices and with minimal environmental impact, according to the report, which assesses the value of continuing to fund geothermal energy study. It was led by the Massachusetts Institute of Technology.

The United States is the world's biggest producer of commercial geothermal energy, with most of its plants in California, Hawai'i, Utah and Nevada. The systems were the third-largest source of renewable energy in the nation in 2003, supplying electricity to about 2.8 million households, according to the Geothermal Energy Association.

That's about as much as wind and solar energy production combined, and it has potential to be a steadier source, the report said.

"Heat in the U.S. is an enormous resource," said Karl Gawell, executive director of the energy association. "We've just began to tap it."

Existing geothermal plants are mainly located in regions of the West, where hot rocks are closer to the surface, requiring less drilling and less money. Other areas could be commercially viable because of improved technology, the report said.

The report recommended more detailed assessments of hot rock deposits, field trials of geothermal energy production sites and more research on related technology.

The environmental impact of geothermal energy is much less than that of fossil fuels and nuclear energy, though water requirements for geothermal plants could be a problem in arid regions, the report said, and the seismic risk also needs to be monitored and managed.