Geothermal frontrunner Fervo Energy said Wednesday it had secured $206 million in funding to continue work at Utah’s new power plant.
The startup is developing what promises to become the world’s largest enhanced geothermal power plant. The early stages of the Cape Station are scheduled to come online next year, producing 100 megawatts of electricity, and the subsequent expansion, which opens in 2028, will add another 400 megawatts.
Enhanced geothermal, which runs deeper and hotter than traditional geothermal, has become a positive technology in the quest to find new power sources in AI data centers. By hitting the heat of the Earth, geothermal promises to provide 24/7 electricity without emissions. It’s not harmful to rely on skills pioneered by the oil and gas industry.
The news comes the day after Fervo announced it had completed the hottest and deeper well ever. The company has drilled 15,765 feet in 16 days and the temperature at the bottom of the well is expected to be stable at around 520°F.
Excavation times represent a large portion of the cost of geothermal power plants, so startups are racing to see who can drill faster.
Fervo results unlocked new cash spigots. The funding announced today includes $100 million in project-level preferred stake from Breakthrough Energy Catalyst, the project finance arm of Bill Gates’ groundbreaking energy group. Mercuria, which previously provided a $120 million loan, has provided an additional $60 million to the facility. X-Caliber’s Rural Capital Affiliate also donated $45.6 million to the bridging debt financing.
Startups have been in tears of fundraising recently. Fervo raised $244 million in February 2024 and another $255 million in December, splitting it into equities and debt. Energy Secretary Chris Wright was at the helm of free energy when the company invested in Fervo in 2022.
The rise in debt is a sign that investors feel that strengthened geothermal has passed through the valley of commercial death and is ready for widespread commercial adoption.