Geothermal frontrunner Fervo Energy said Wednesday that it had secured $206 million in financing to continue work on a new power plant in Utah.
The startup is developing what promises to be the largest enhanced geothermal power plant in the world. The initial phase of Cape Station is expected to come online next year and produce 100 megawatts of electricity, and a subsequent expansion set to open in 2028 will add another 400 megawatts.
Enhanced geothermal, which runs deeper and hotter than traditional geothermal, has become a favored technology in the quest to find new power sources for AI data centers. By tapping the Earth’s heat, geothermal promises to provide 24/7 power without emissions. It doesn’t hurt that it relies on skills pioneered by the oil and gas industry, something that likely helps its standing within the Trump administration.
The news comes the day after Fervo announced that it had completed its hottest and deepest well to date. The company said it drilled down 15,765 feet in 16 days, and the temperature at the bottom of the well is expected to stabilize at around 520 degrees F.
Drilling time represents a large share of geothermal power plant costs, which is why startups have been racing to see who can drill deeper and faster.
Fervo’s results have unlocked a new spigot of cash. The financing announced today includes $100 million in project-level preferred equity from Breakthrough Energy Catalyst, the project finance arm of Bill Gates’s Breakthrough Energy group. Mercuria, which had previously provided a $120 million loan, provided another $60 million to that facility. And an X-Caliber Rural Capital affiliate contributed $45.6 million in bridge debt financing.
The startup has been on a fundraising tear lately. Fervo raised $244 million in February 2024 and another $255 million in December that was split between equity and debt. Energy secretary Chris Wright was at the helm of Liberty Energy when the company invested in Fervo in 2022.
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The increasing amounts of debt are a sign that investors feel that enhanced geothermal has passed through the commercial valley of death and is ready for widespread commercial adoption.