US Geothermal Tax Credits in 2026: What Is Actually Still Alive After OBBBA For an industry that spent more than a decade building financial models around a stable federal incentive structure, 2026 has been a year of whiplash. The 30% federal geothermal tax credit that developers and homeowners built forecasts around is gone in one form and still alive in another, and even the IRS’s own public guidance has been confusing enough to trigger uncertainty across the market. That confusion is not a minor clerical issue. It is shaping investment decisions, contractor sales pitches, homeowner timelines, and project finance assumptions right now. If you work in geothermal, the key question is no longer whether federal incentives exist, but which incentive applies, to which project type, and under what ownership structure. The law that changed the timeline To understand where things stand in 2026, you have to start with the Inflation Reduction Act of 2022, which created a long runway for clean e...
Quaise Energy's Ambitious $200 Million Raise: Paving the Way for Superhot Geothermal Revolution
Welcome back to Alphaxioms Geothermal News, your go-to source for the latest breakthroughs in sustainable energy from the heart of geothermal innovation. As we dive into March 2026, the geothermal sector is heating up—literally—with exciting developments that could reshape our global energy landscape. Today, we're spotlighting Quaise Energy, a Houston-based startup that's making waves (millimeter waves, to be precise) in the quest for unlimited clean power. The company is in the process of raising approximately $200 million to fund its groundbreaking first commercial geothermal power plant in Oregon. This move not only underscores the growing investor confidence in next-generation geothermal technologies but also positions Quaise as a frontrunner in unlocking terawatt-scale energy from deep beneath the Earth's surface.
For those new to the geothermal scene, let's set the stage. Geothermal energy harnesses the planet's internal heat, a virtually inexhaustible resource that's been powering homes and industries for decades in places like Iceland and New Zealand. However, traditional geothermal relies on naturally occurring hot spots near the surface, limiting its scalability. Enter "superhot" geothermal, which targets deeper, hotter rock formations—think temperatures exceeding 300°C (572°F)—to generate far more efficient power. Quaise Energy is at the vanguard of this shift, leveraging fusion-inspired drilling tech to access resources that were once deemed unreachable. With the world racing toward net-zero emissions by 2050, innovations like these could provide always-on, carbon-free baseload power to complement intermittent renewables like solar and wind.
The Genesis of Quaise Energy: From MIT Labs to Energy Pioneer
Quaise Energy spun out of MIT's Plasma Science and Fusion Center in 2018, founded by Carlos Araque and a team of engineers passionate about bridging fusion research with real-world energy solutions. The company's core mission? To democratize geothermal energy by making it accessible anywhere on Earth, not just in volcanic regions. By repurposing infrastructure from the oil and gas industry—think rigs, workforce, and supply chains—Quaise aims to accelerate the transition to clean energy without starting from scratch.
At the heart of Quaise's approach is millimeter-wave drilling, a technology adapted from gyrotrons used in nuclear fusion experiments. Unlike conventional mechanical drills that wear out quickly in hard rock, Quaise's system uses high-frequency electromagnetic beams to melt and vaporize rock, allowing for ultra-deep boreholes up to 20 kilometers (12 miles) deep. This enables access to "superhot rock" geothermal resources, where higher temperatures mean greater energy density: a single well could produce as much power as dozens of shallower ones. The process begins with standard rotary drilling to reach basement rock, then switches to the gyrotron-powered platform for the deep dive. No complex downhole tools are needed, reducing costs and risks.
Quaise's journey has been marked by steady progress. In recent years, they have successfully conducted tests, including demonstrations with partners like Nabors Industries, and are advancing toward field-scale operations. These efforts are crucial for validating the technology's ability to withstand extreme conditions like scorching heat and corrosion. As CEO Carlos Araque has emphasized, combining superhot geothermal with advanced drilling could enable deployment "just about anywhere in the world." This scalability is key, especially as demand for reliable power surges from data centers, AI infrastructure, and widespread electrification.
A Track Record of Funding Success: Building Momentum
Quaise hasn't been short on investor interest. To date, the company has secured over $120 million from a roster of heavy hitters, including Mitsubishi Corporation, Nabors Industries (a major oil and gas drilling contractor), Prelude Ventures, Safar Partners, and Standard Investments. Their funding history tells a story of incremental triumphs, with earlier rounds supporting R&D, team building, and demonstrations.
These rounds reflect the geothermal sector's broader boom. In recent years, peers like Fervo Energy and others have attracted significant capital, fueled by
U.S. Department of Energy support, tax credits, and growing recognition of geothermal's role in reliable clean power. As industry voices have noted, this is an exciting time for geothermal, driven by an "insatiable need for power" amid electrification and data center growth.
The $200 Million Raise: Fueling Project Obsidian
Now, Quaise is eyeing its most ambitious funding yet: $200 million to bring its vision to life. This includes $100 million in Series B equity financing, with the remaining $100 million from grants, debt, and project-level equity. The raise is driven by an anticipated 250 MW power purchase agreement (PPA) with an undisclosed buyer, signaling strong market demand. This capital will directly support the development of Quaise's flagship project in Oregon, marking a pivot from R&D to commercialization.
Announced in late February 2026, the funding comes at a pivotal time. Economic uncertainties and policy shifts have slowed some investments, but geothermal's promise as a baseload source—especially for AI-driven data centers—keeps the momentum alive. Quaise's strategy leverages private lands to expedite permitting, though regulatory processes remain a factor.
Spotlight on Project Obsidian: Oregon's Geothermal Frontier
At the center of this raise is Project Obsidian, Quaise's catalyst for scaling superhot geothermal worldwide. Located in Central Oregon near the Newberry Volcano (close to Bend), the site was chosen for its promising subsurface conditions, with temperatures expected to surpass 300°C at depths of 16,000 feet or more. Groundbreaking occurred last year, and drilling is set to commence to validate these conditions.
The project starts with an initial 50 MW of always-on power, using enhanced geothermal systems (EGS) that fracture rocks and circulate water to produce steam for turbines. Quaise has already inked a PPA for this output and is negotiating for an additional 200 MW, bringing the total to 250 MW. Full commercial operation is targeted for 2030, with milestones including first thermal energy extraction in 2026.
Visualizing this innovation: Quaise's millimeter-wave drilling in action showcases the gyrotron beam vaporizing rock for ultra-deep access, blending conventional rotary methods with cutting-edge tech.
Project Obsidian isn't just about power generation; it's a proof-of-concept for global deployment. By requiring less land and materials than solar or wind, it offers a compact, efficient alternative. Oregon's volcanic geology provides an ideal testing ground, but the tech's portability means it could soon power regions like East Africa, where geothermal potential is vast yet underexplored—relevant for our Nairobi-based readers.
Diving Deeper: The Technology and Its Challenges
Quaise's millimeter-wave tech is revolutionary. Gyrotrons generate beams at high frequencies, powerful enough to turn rock into vapor. This avoids the friction and wear of traditional bits, enabling faster, cheaper drilling in hard basement rock. The system demands significant power, but delivers exponential returns: hotter geothermal means higher efficiency, potentially powering economies at scale.
Yet, challenges remain. Superhot environments are corrosive, and validating subsurface data requires precise execution. Quaise mitigates this by starting with proven rotary methods before transitioning. Broader hurdles include regulatory timelines and the need for substantial capital—hence the $200 million push. Navigating permits, even on private land, can slow progress, but the payoff is immense.
Here's a conceptual view of the Project Obsidian site in Oregon, highlighting the integration of advanced drilling with natural geothermal features.
Broader Implications: A Geothermal Renaissance
This $200 million raise could catalyze a geothermal renaissance. With the U.S. pushing for carbon-free power amid AI and electrification booms, superhot tech like Quaise's addresses the growing demand for reliable energy. Globally, it promises energy independence, job creation (repurposing oil workers), and equity especially in developing regions.
Successes in peers bode well. If Quaise succeeds, we could see terawatts of clean energy by mid-century, slashing emissions and stabilizing grids.
Wrapping Up: The Heat Is On
Quaise Energy's pursuit of $200 million isn't just about funding—it's about igniting a new era of abundant, clean power. As Project Obsidian takes shape in Oregon, keep an eye on this space for updates. At Alphaxioms, we're optimistic: geothermal isn't just hot; it's the future. What do you think—could superhot tech transform your local energy scene? Drop your thoughts in the comments!
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