According to documents filed with the Securities and Exchange Commission, Fervo Energy is currently in the process of raising $221 million after the successful completion of its geothermal power plant in Nevada. TechCrunch has received exclusive information about this development.
This Houston-based company is part of a group of enhanced geothermal startups that are competing to tap into the heat deep within the Earth’s crust. Previous geothermal plants have only been able to access hot springs or shallower rock formations, but Fervo is using directional drilling techniques pioneered by the oil and gas industry to extend their wells beyond surface limitations. It’s no surprise that the company’s executive team is made up of experienced professionals from this sector.
Once the wells are drilled, Fervo installs fiber optic cables and sensors to monitor and collect data on subsurface heat patterns and well performance. This data is then analyzed by teams on the surface.
Fervo has been on a successful streak recently. Just a few weeks ago, they completed a horizontal well at a project in Utah in just 21 days, a 70% reduction in time compared to their first well drilled in 2022. Additionally, they were able to cut costs in half, although each well still comes with a hefty price tag of $21 million. The company’s progress has exceeded the expectations of the Department of Energy.
In the same month, Fervo received a $25 million grant from the Department of Energy. Their last funding round in July 2022 raised $138 million at a valuation of $308 million, according to PitchBook data. Previous investors include BHP Ventures, Breakthrough Energy Ventures, Congruent Ventures, DCVC, and Prelude Ventures, with early support from angel investors such as Jeff Bezos, Richard Branson, Bill Gates, and Masayoshi Son.
In November, Fervo made history by connecting their 3.5-megawatt Project Red power plant to the Nevada grid, becoming the first of its kind. This plant will power Google’s data centers in the state, providing 24/7 firm power without the need for batteries.
The Department of Energy estimates that geothermal has the potential to generate 90 gigawatts of electricity annually in the U.S. by 2050. Beyond providing carbon-free power to the grid, supporters of this technology see it as an opportunity to reemploy workers from the declining oil and gas industry.
Fervo has yet to respond to a request for comment at the time of publication. Given the high costs associated with geothermal drilling due to the tougher rock formations compared to oil and gas rigs, it is likely that the company will use their new funding to continue drilling more wells, improving their efficiency and lowering costs in the process.
