This paper investigates the potential of current energy harvesting from a freely-oscillating circular cylinder, with a focus on near-ground effects. Energy can be harvested by converting the oscillatory motion of a cylinder excited by water current into electricity. The boundary shear layer, created by the ground surface, interacts with the cylinder vortices and consequently affects the force behavior and power harvesting performance. The problem is simulated in a two-dimensional turbulent flow, using the Finite Volume (FV) solver and the dynamic motion module, inherited in OpenFOAM. Ground effects on the power generation capacity of an oscillating cylinder operating in river current velocity at Reynolds number of 3 × 104 are studied at varying depths. Vortex-induced vibration is studied to observe the ground boundary layer influence on the structural response, vortex structure, hydrodynamic forces, and gained power. The results shed physical insight into the understanding of the flow behavior of the oscillating cylinder near the ground. Simulations show that the ground effect appears when the distance between the cylinder and the ground is less than three times the cylinder’s diameter. Decreasing the gap distance between the cylinder and the ground suppresses the vortices behind the oscillating cylinder, causing an increase in the harvested energy. Further, the optimal-power harvesting distance between the ground and the freely-oscillating cylinder is two and half times the cylinder’s diameter, because of the high oscillating frequency, causing higher power relative to shorter distances.