Skip to main content

Just In

Who Finances Next-Generation Geothermal Projects? Key Investors and Funding Trends

"Fervo Energy's innovative geothermal technology could act as a flexible and long-lasting battery, revolutionizing clean energy production"

Fervo Energy, a geothermal power start-up based in Houston, is testing a new spin on traditional geothermal plants. The start-up's experiments suggest that it can create flexible geothermal power plants, which are capable of producing electricity that can be ramped up or down as required. 

Fervo’s enhanced geothermal demonstration site in northern NevadaALASTAIR WIPER/COURTESY OF FERVO ENERGY

Additionally, the system can store up energy for hours or days, essentially acting as a giant and long-lasting battery. This means that the plants could shut down production when solar and wind farms are generating power and provide a rich stream of clean electricity when those sources flag. Fervo's approach could potentially fill a critical gap in modern power grids, making it cheaper and easier to eliminate greenhouse-gas emissions from electricity systems.

The results from the initial experiments—which MIT Technology Review is reporting exclusively—suggest Fervo can create flexible geothermal power plants, capable of ramping electricity output up or down as needed. Potentially more important, the system can store up energy for hours or even days and deliver it back over similar periods, effectively acting as a giant and very long-lasting battery. That means the plants could shut down production when solar and wind farms are cranking, and provide a rich stream of clean electricity when those sources flag.


There are remaining questions about how well, affordably, and safely this will work on larger scales. But if Fervo can build commercial plants with this added functionality, it will fill a critical gap in today’s grids, making it cheaper and easier to eliminate greenhouse-gas emissions from electricity systems.


“We know that just generating and selling traditional geothermal is incredibly valuable to the grid,” says Tim Latimer, chief executive and cofounder of Fervo. “But as time goes on, our ability to be responsive, and ramp up and down and do energy storage, is going to increase in value even more.” 


‘Geothermal highway’

In early February, Latimer drove a Fervo colleague and me from the Reno airport to the company site.


“Welcome to Geothermal Highway,” he said from behind the wheel of a company pickup, as we passed the first of several geothermal plants along Interstate 80. 


The highway cuts through a flat desert in the midst of Nevada’s Basin and Range, the series of parallel valleys and mountain ranges formed by separating tectonic plates.


The crust stretched, thinned, and broke into blocks that tilted, forming mountains on the high side while filling in and flattening the basins with sediments and water, as John McPhee memorably described it in his 1981 book, Basin and Range. From a geothermal perspective, what matters is that all this stretching and tilting brought hot rocks relatively close to the surface.


There’s much to love about geothermal energy: it offers a virtually limitless, always-on source of emissions-free heat and electricity. If the US could capture just 2% of the thermal energy available two to six miles beneath its surface, it could produce more than 2,000 times the nation’s total annual energy consumption.


But because of geological constraints, high capital costs and other challenges, we barely use it at all: today it accounts for 0.4% of US electricity generation. 


To date, developers of geothermal power plants have largely been able to tap only the most promising and economical locations, like this stretch of Nevada. They’ve needed to be able to drill down to porous, permeable, hot rock at relatively low depths. The permeability of the rock is essential for enabling water to move between two human-drilled wells in such a system, but it’s also the feature that’s often missing in otherwise favorable areas. 


Starting in the early 1970s, researchers at Los Alamos National Laboratory began to demonstrate that we could engineer our way around that limitation. They found that by using hydraulic fracturing techniques similar to those now employed in the oil and gas industry, they could create or widen cracks within relatively solid and very hot rock. Then they could add in water, essentially engineering radiators deep underground.


Such an “enhanced” geothermal system then basically works like any other, but it opens the possibility of building power plants in places where the rock isn’t already permeable enough to allow hot water to circulate easily. Researchers in the field have argued for decades that if we drive down the cost of such techniques, it will unlock vast new stretches of the planet for geothermal development. 


A noted MIT study in 2006 estimated that with a $1 billion investment over 15 years, enhanced geothermal plants could produce 100 gigawatts of new capacity on the grid by 2050, putting it into the same league as more popular renewable sources. (By comparison, about 135 gigawatts of solar capacity and 140 gigawatts of wind have been installed across the US.)


“If we can figure out how to extract the heat from the earth in places where there’s no natural circulating geothermal system already, then we have access to a really enormous resource,” says Susan Petty, a contributor to that report and founder of Seattle-based AltaRock Energy, an early enhanced-geothermal startup. 


The US didn’t make that full investment over the time period called for in the report. But it has been making enhanced geothermal a growing priority in recent years.


The first major federal efforts began around 2015, when the Department of Energy announced plans for the Frontier Observatory for Research in Geothermal Energy laboratory. Drilling at the selected Utah FORGE site, near Milford, finally commenced in 2016. The research lab has received some $220 million in federal funds to date. More recently, the DOE has announced plans to invest tens of millions of dollars more in the field through its Enhanced Geothermal Shot initiative.


But there are still only a handful of enhanced geothermal systems operating commercially in the US today.


Fervo’s bet

Latimer read that MIT paper while working in Texas as a drilling engineer for BHP, a metal, oil, and gas mining company, at a point when he was becoming increasingly concerned about climate change. From his own work, he was convinced that the natural-gas fracking industry had already solved some of the technical and economic challenges highlighted in the report.


Latimer eventually quit his job and went to Stanford Business School, with the goal of creating a geothermal startup. He soon met Jack Norbeck, who was finishing his doctoral dissertation there. It included a chapter focused on applied modeling of the Los Alamos findings.


The pair cofounded Fervo in 2017. The company has since raised nearly $180 million in venture capital from Bill Gates’s Breakthrough Energy Ventures, DCVC, Capricorn Investment Group, and others. It’s also announced several commercial power purchase agreements for future enhanced-geothermal projects, including a five-megawatt plant at the Nevada site that will help power Google’s operations in the state.


Under those deals, Fervo is contracted to provide a steady flow of carbon-free electricity, not the flexible features it’s exploring. But almost from the start, utilities and other potential customers told the company that they needed to line up clean sources that could ramp generation up and down, to comply with increasingly strict climate regulations and balance out the rising share of variable wind and solar output on the grid.


“If we can come up with a way to solve this,” Norbeck says he and Latimer realized, “we might really have a way to change the world.”  


Fervo began to explore whether they could do so by taking advantage of another feature of enhanced geothermal systems, which the Los Alamos researchers had also highlighted in later experiments. 


Creating fractures in rocks with low permeability means that the water in the system can’t easily leak out into other areas. Consequently, if you close off the well system and keep pumping in water, you can build up mechanical pressure within the system, as the fractured rock sections push against the earth. 


“The fractures are able to dilate and change shape, almost like balloons,” Norbeck says.


That pressure can then be put to use. In a series of modeling experiments, Fervo found that once the valve was opened again, those balloons effectively deflated, the flow of water increased, and electricity generation surged. If they “charged it” for days, by adding water but not letting it out, it could then generate electricity for days. 


But the company still needed to see if it could work in the real world. 


The tests

After crossing in Humboldt County, Nevada, Latimer eventually steered onto a dirt road. The Fervo site announced itself with a white drilling rig in the distance, soaring 150 feet above a stretch of brown desert. The geology under this particular stretch of land includes hot rocks at shallow depths, but not the permeability needed for traditional plants.


In 2022, the company drilled twin boreholes there, using a nearly 10-inch fixed-cutter drill bit to slowly grind through mixed metasedimentary and granite formations. The wells gradually bend beneath the earth, ultimately plunging some 8,000 feet deep and running around 4,000 feet horizontally.


Fervo then injected cold water under high pressure to create hundreds of vertical fractures between them, effectively forming a giant underground radiator amid rock that reaches nearly 380 ˚F (193 ˚C)

source :(MIT Technologyreview)

Comments

Popular posts from this blog

Eavor Validates Closed-Loop Geothermal Technology at Germany's Geretsried Project

Eavor Remains Committed to Geretsried as Loop 1 Proves Closed-Loop Geothermal Technology at Commercial Scale CALGARY, Canada / GERETSRIED, Germany, image : The Eavor Geretsried Project   Company confirms flagship German project has validated Eavor-Loop™ technology, achieved major drilling cost reductions, and will serve as the foundation for global deployment through licensing and next-generation drilling innovation. Eavor Technologies has reaffirmed its commitment to completing the landmark Geretsried geothermal project, describing the development as a pivotal milestone not only for the company but also for the future of closed-loop geothermal energy worldwide. In exclusive responses provided to Alphaxioms, Eavor President and Chief Executive Officer Mark Fitzgerald confirmed that the company remains the operator of the project and is working closely with partners and stakeholders to complete the remaining development phases. "Eavor is currently the operator at Geretsried an...

Doug Copeland Interview: Geothermal Industry Insights for USA and Global Renewable Energy Markets

Alphaxioms Interview: Doug Copeland Image: Doug Copeland Created a Transmission Strategy For the Mountain West Geothermal Consortium and also has expertise in Early Stage Development on Site identification based on Land 1. Could you briefly introduce yourself and tell our readers how you became involved in the geothermal industry? I have spent over 20 years in renewable energy development. My last role before geothermal was helping to set up an offshore wind joint venture and building two teams as we grew from 8 to 250 people. I wanted to stay in renewable energy and see a lot of similarities with geothermal and offshore wind. I started with one consulting client last fall and grew from there. Over the course of two decades I worked across multiple stages of project development, from early site evaluation and stakeholder engagement to permitting, financing, and construction oversight. That breadth of experience helped me transition smoothly between technologies because many project-dev...

Germany Köln‑Dellbrück Massenkalk Geothermal Exploration: What the Deep Data Reveals

Köln, Dellbrück Research Well, Probing the Massenkalk for Hydrothermal Geothermal Potential Image: A drilling rig at the Köln-Dellbrück geothermal research site, probing deep underground for hidden heat. Since late June 2026 a rotary drill bit has been descending at Thurner Kamp in Köln, Dellbrück, marking the start of a targeted research drilling campaign by the Geological Service of North Rhine, Westphalia, GD NRW. The exploratory borehole, planned to reach up to 1,000 meters, will test whether the region’s roughly 380 million year old limestone sequence known as the Massenkalk can act as a viable hydrothermal geothermal reservoir. For industry stakeholders, utilities and project developers, the drill program offers both immediate technical insights and strategic data to inform future geothermal development under the Masterplan Geothermie NRW. Why Köln, Dellbrück matters to geothermal development in NRW North Rhine, Westphalia is one of Germany’s most densely populated and industrial...

Tanzania’s Ngozi Geothermal Drilling Contract Boosts Geothermal Exploration and Energy Development

ELC Electroconsult Wins Tanzania’s Ngozi Geothermal Drilling Contract Tanzania has taken another meaningful step toward commercial geothermal development after Italy’s ELC Electroconsult secured a contract to oversee exploratory drilling at the Ngozi geothermal field. The award marks an important milestone for the  Tanzania Geothermal Development Company Limited (TGDC) as the country works to unlock one of its most promising renewable energy resources. The contract is more than a routine consultancy assignment. It signals a deliberate push to turn geological potential into actionable project data, strengthen local technical capacity, and build the foundation for future geothermal power generation in Tanzania’s energy mix. Tanzania’s Geothermal Ambition Gains Momentum Geothermal energy has long been viewed as one of Tanzania’s most promising but underdeveloped domestic energy sources. The country sits within the East African Rift System, a geologically active zone that offers stro...

New York’s Geothermal Push Could Reshape Heating and Cooling Costs

New York Is Betting on Geothermal to Cut Heating Costs Image:New Yorks Statue of Liberty,  " Forever Liberated " New York is moving geothermal and thermal energy networks from niche ideas into real-world pilots, with state support, utility investment, and an explicit goal of lowering long-term utility bills. The latest projects in Syracuse and Buffalo show two different paths to the same objective: make clean heating and cooling cheaper, easier to install, and scalable across more buildings. Why New York is investing now The state’s push is rooted in a simple idea: heating and cooling still account for a large share of building energy use, and existing systems waste a lot of usable heat. NYSERDA President and CEO Doreen Harris said geothermal demonstrations are meant to reduce costs for consumers and help technologies move from innovation to commercialization at scale. That matters because the biggest barrier to adoption is often not the technology itself, but the upfront co...

Geothermal Financing in the Netherlands: Targeted Investment Strategies with Invest-NL, EBN, and Geothermie Nederland for Low-Carbon Heat Growth

Financing Geothermal Energy: How Targeted Instruments Can Unlock a National Heat Transition The Netherlands sits on a valuable but underused subsurface resource, sustainable geothermal heat. Ambitious heating targets and growing demand for low-carbon district heat make geothermal an essential part of the energy transition. Yet a familiar barrier persists , high upfront development costs and early,phase risks make many projects unattractive to private financiers. This article explains practical financing instruments, project structures, and policy actions that can reduce those early risks, speed deployment, and attract private capital for geothermal energy at scale. Why geothermal financing is difficult Geothermal projects face a financial profile unlike typical renewables. Main challenges include: , High upfront capital expenditure (CAPEX) during exploration and drilling, with the bulk of costs front,loaded. , Subsurface uncertainty, resource quality (temperature, flow) is only conf...

University of Aberdeen and RGU partner to accelerate geothermal heating deployment

University of Aberdeen and RGU join forces to accelerate geothermal energy research and heat-network deployment Image: Lucy Leiper, Director of Research, Innovation & Enterprise at the University of Aberdeen and Christina Laing, Business Development Manager at Robert Gordon University The University of Aberdeen and Robert Gordon University (RGU) have signed a Memorandum of Agreement to explore collaborative research, training and commercial activity in geothermal energy and low-carbon heating. This strategic partnership aims to combine subsurface expertise, drilling and modelling capabilities, supply-chain development, and skills training to accelerate geothermal deployment and support the just transition to net-zero heating across Scotland and beyond. Why this partnership matters for the geothermal sector Geothermal heat offers a predictable, baseload source of low-carbon thermal energy that can decarbonise district heating, industry process heat and building heating demand. Scotl...

Tender: Novi Sad Hybrid Geothermal-Solar District Heating Project in Mišeluk

Novi Sad Moves Forward With Hybrid Geothermal-Solar District Heating Project in Mišeluk Novi Sad is advancing a new district heating project in Mišeluk that combines geothermal energy, natural gas, and solar technology into one hybrid system. The city-owned utility Novosadska toplana has launched a tender for the design and construction of the heating plant, with an estimated procurement value of RSD 892.5 million, or about EUR 7.6 million, excluding VAT. The project is designed to supply heat to residential, commercial, public, and sports facilities in the Mišeluk neighborhood on the right bank of the Danube. Although the area already has a district heating network, it currently lacks a local heat source, making the new plant an important step toward more stable and efficient heat supply. A Hybrid Approach to District Heating The Mišeluk heating plant will use a combination of geothermal energy, gas boilers, and solar technology. In its first phase, the facility will include a water-t...

Husum Geothermal Project: DMT-Led Feasibility Study for Deep Geothermal Heating

Husum Geothermal Project: Germany Advances Deep Geothermal Heating with DMT-Led Feasibility Study The North Frisian town of Husum is taking a decisive step toward decarbonizing its heating sector by exploring deep geothermal energy. Stadtwerke Husum GmbH has commissioned DMT Group to undertake a comprehensive feasibility study that will determine whether geothermal resources beneath the region can provide sustainable, climate-friendly heating for homes and businesses.  As Europe accelerates its transition away from fossil fuels, municipalities across Germany are increasingly turning to geothermal energy as a reliable source of renewable heat. Husum's latest initiative reflects this growing momentum and demonstrates how scientific assessment forms the foundation of successful geothermal development.  Husum Begins Assessment of Deep Geothermal Potential Stadtwerke Husum GmbH , the municipal utility responsible for supplying energy services in the city of Husum, has appointed ...

XGS Energy IPO: Morgan Stanley, Geothermal Growth, and Fervo’s Market Momentum

XGS Energy Weighs IPO After Hiring Morgan Stanley, Chasing Fervo's Geothermal Momentum Geothermal developer XGS Energy has hired Morgan Stanley to evaluate an initial public offering, positioning itself as a potential second geothermal IPO of 2026 after Fervo Energy's blockbuster listing. The move underscores growing investor appetite for clean, firm power technologies as data-center demand and grid reliability concerns reshape the energy investment landscape. The Scoop: Morgan Stanley, IPO Timing, and Market Context In early July 2026, Axios Pro reported that XGS Energy engaged Morgan Stanley to assess a public listing, with company leadership potentially deciding within about a month whether to proceed. The timing is strategic: Fervo Energy's May 2026 IPO created a rare "open window" for geothermal equities, providing valuation benchmarks and investor education that earlier private rounds lacked. For investors, the narrative is straightforward. If Fervo proved t...