Tapping into the heat beneath our feet to provide gigawatts of clean energy
Geothermal energy is clean and can be dispatched where and when needed – it’s a “firm” resource in the jargon of energy wonks. So, why don’t we use more of it? Historically, geothermal reservoirs have been expensive to develop and operate. Thanks to Fervo Energy, the most recent addition to DCVC Climate’s portfolio of companies, that’s changing.
The interior of Earth is hot. Hot rocks make hot water. (Fervo means “I boil” in Latin). Hot water makes steam. Steam spins turbines that make electricity. The art and science of geothermal engineering is finding those hot rocks, accessing them economically, and extracting thermal energy efficiently. It’s easier said than done.
Fervo has adapted reservoir modeling and horizontal drilling techniques, perfected over the last 30 years by the oil and gas industry, to the needs of geothermal energy. Analysis of terabytes of data from downhole fiber optic sensors lets Fervo see into the Earth’s subsurface and optimize where and how to drill. In turn, these innovations improve the productivity and profitability of geothermal energy, unlocking more deployment.
Fervo is an energy company, not a science project: it plans to build, own, and operate gigawatts (GW) of power plants this decade. We need that kind of speed and scale. If we hope to decarbonize the electricity grid, most experts say at least 20% of capacity must be from firm carbon-free resources. Geothermal energy is largely untapped and one of humanity’s best tools to create that clean energy future.
The company reflects DCVC Climate’s investing thesis to a remarkable degree. It has a high-achieving team committed to building a large, valuable, and independent company. It possesses a technology-enabled, first-mover advantage. It attracted smart co-investors, found a savvy initial customer, and enjoys increasing market pull. What’s not to like?
Fervo’s founders are prescient and compassionate. Tim Latimer and Jack Norbeck have tremendous appreciation, based on direct experience, for the talent and technology in oil and gas that now power our planet. Keenly aware of the challenges of that industry, they see energy transition as inevitable. But what happens to all those good people? Fervo will offer rewarding and reliable careers in carbon-free geothermal energy.
Today, the US has 120 GW of solar energy capacity, 140 GW of wind energy, but only 4 GW of geothermal energy. Geothermal has huge growth potential. The US Department of Energy’s GeoVision study forecasts that geothermal could supply as much as 120 GW of 24⁄7 carbon-free electricity by 2050, or about 16% of US generation. DCVC Climate believes that the companies driving growth in geothermal energy will be highly valued, and Fervo is among the leaders. So, yes, we intend to make money, too.
Matt Trevithick is a Partner and Rachel Slaybaugh is a Principal at DCVC Climate
“The Role of Firm Low-Carbon Electricity Resources in Deep Decarbonization of Power Generation” by Sepulveda et al, Joule, Volume 2, Issue 11, 21 November 2018