Fervo Energy Advances Geothermal Energy Goals with $255 Million Boost

Fervo Energy, a Houston-based geothermal energy developer, has announced $255 million in new funding to accelerate the deployment of its innovative geothermal power projects. The financing includes $135 million in corporate equity and $120 million in debt capital, underscoring strong investor confidence in the company’s approach to delivering carbon-free energy.

Founded in 2017, Fervo specializes in advanced geothermal technologies, employing techniques like horizontal drilling and distributed fiber optic sensing to transform underground reservoirs of hot rock into viable clean energy sources. The company’s flagship project, Cape Station, located in Beaver County, Utah, aims to generate up to 2 GW of baseload power. Approved by the U.S. Bureau of Land Management in October, Cape Station will utilize water injection into subsurface rock formations to produce continuous, carbon-free electricity. The project’s first phase is slated to begin operations in 2026.

Tim Latimer, Fervo’s CEO and Co-Founder, highlighted the growing demand for round-the-clock clean energy. “The demand for 24/7 carbon-free energy is at an all-time high, and Fervo is one of the only companies building large projects that will come online before the end of the decade,” he said. “Investors recognize that Fervo’s ability to get to scale quickly is vital in an evolving market that is seeing unprecedented energy demand from AI and other sources.”

The equity funding was led by Capricorn’s Technology Impact Fund II and included contributions from Breakthrough Energy Ventures, CalSTRS, Congruent Ventures, CPP Investments, DCVC, Devon Energy, Galvanize Climate Solutions, Liberty Mutual Investments, Mercuria, and Sabanci Climate Ventures.

Mercuria, a key provider of the $120 million debt capital, also facilitated a letter of credit and term loan facility to support the accelerated deployment of Fervo’s enhanced geothermal systems (EGS) projects. Brian Falik, Group Chief Investment Officer of Mercuria, emphasized the transformative potential of Fervo’s technology. “In surveying power markets across the U.S. today, the need for next-generation geothermal is undeniable,” he said. “We believe in Fervo not just because their EGS approach is cost-effective, commercially viable, and already being deployed at scale, but because they set ambitious targets and consistently deliver.”

This funding announcement follows a $244 million round earlier this year and $138 million in 2022, positioning Fervo as a leading player in the geothermal energy sector. As energy demand continues to rise, particularly driven by advancements in AI and other technologies, Fervo’s projects are set to play a critical role in delivering reliable, clean energy solutions.