According to Wikipedia, the lagoon is fed by the water output of a nearby geothermal power plant. Superheated water is vented from the ground near a lava flow and used to run turbines that generate electricity. After going through the turbines, the steam and hot water passes through a heat exchanger to provide heat for a municipal hot water heating system. Then the water is fed into the lagoon for recreational and medicinal users to bathe in.
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