Fervo named to prestigious list of climate tech companies to watch

top honor

Fervo Energy has landed a coveted spot on MIT Technology Review's list of global climatetech companies to watch. Photo via fervoenergy.com

Houston-based Fervo Energy has received yet another accolade—MIT Technology Review named the geothermal energy startup to its 2025 list of the 10 global climatetech companies to watch.

Fervo, making its second appearance on the third annual list, harnesses heat from deep below the ground to generate clean geothermal energy, MIT Technology Review noted. Fervo is one of four U.S. companies to land on the list.

Fervo “uses fracking techniques to create geothermal reservoirs capable of delivering enough electricity to power massive data centers and hundreds of thousands of homes,” MIT Technology Review said.

MIT Technology Review said it produces the annual list to draw attention to promising climatetech companies that are working to decarbonize major sectors of the economy.

“Though the political and funding landscape has shifted dramatically in the US since the last time we put out this list,” MIT Technology Review added, “nothing has altered the urgency of the climate dangers the world now faces — we need to rapidly curb greenhouse gas emissions to avoid the most catastrophic impacts of climate change.”

In addition to MIT Technology Review’s companies-to-watch list, Fervo has appeared on similar lists published by Inc.com, Time magazine and Climate Insider.

In an essay accompanying MIT Technology Review’s list, Microsoft billionaire Bill Gates said his Breakthrough Energy Ventures investment group has invested in more than 150 companies, including Fervo and another company on the MIT Technology Review list, Redwood Materials.

In his essay, Gates wrote that ingenuity is the best weapon against climate change.

Yet climate technology innovations “offer more than just a public good,” he said. “They will remake virtually every aspect of the world’s economy in the coming years, transforming energy markets, manufacturing, transportation, and many types of industry and food production. Some of these efforts will require long-term commitments, but it’s important that we act now. And what’s more, it’s already clear where the opportunities lie.”

In a recent blog post highlighting Fervo, Gates predicted geothermal will eventually supply up to 20 percent of the world’s electricity, up from his previous estimate of as much as 5 percent.

Fervo is one of the pioneers in geothermal energy. Gates and other investors have pumped $982 million into Fervo since its founding in 2017. With an estimated valuation of $1.4 billion, Fervo has achieved unicorn status, meaning its valuation as a private company exceeds $1 billion.

Aside from Breakthrough Energy Ventures, oilfield services provider Liberty Energy is a Fervo investor. U.S. Energy Secretary Chris Wright was chairman and CEO of Denver-based Liberty Energy before assuming his federal post.

Axios reported on Oct. 1 that Fervo is raising a $300 million series E round, which would drive up the startup’s valuation. News of the $300 million round comes as the company gears up for a possible IPO, according to Axios.

Fervo co-founder and CEO Tim Latimer told Axios this spring that a potential IPO is likely in 2026 or 2027. Ahead of an IPO, the startup is aiming for a $2 billion to $4 billion valuation, Axios reported.

The first phase of Fervo’s marquee Cape Station geothermal energy plant in Utah is scheduled to go online next year, with the second phase set to open in 2028. Once it’s completed, the plant will be capable of generating 500 megawatts of power. This summer, the startup said it secured $205.6 million in capital to finance construction of the plant.

From Your Site Articles

Bill Gates says companies like Fervo push the geothermal technology 'to new depths.' Photo via fervoenergy.com

Fervo Energy spotlighted by Bill Gates as geothermal’s global growth driver

geothermal predictions

In a new blog post spotlighting Houston-based geothermal power startup Fervo Energy, billionaire Bill Gates — a Fervo investor — predicts geothermal will eventually supply up to 20 percent of the world’s electricity, up from his previous estimate of as much as 5 percent.

Today, geothermal accounts for less than 1 percent of electricity generated around the world, according to the International Energy Agency. The agency forecasts geothermal will represent up to 15 percent of global power by 2050.

“Geothermal power will have a big role to play in our clean energy future, and it’s exciting to see companies like Fervo push the technology to new depths,” Gates wrote.

Gates’ more than $1 billion Breakthrough Energy Ventures fund has contributed to the $982 million pool of money that Fervo has raised since its founding in 2017. Fervo is now a unicorn, meaning its valuation as a private company exceeds $1 billion. Its valuation has been estimated at $1.4 billion.

The Microsoft billionaire published the blog post on his Gates Notes website after touring the site of Fervo’s Cape Station geothermal project, which is under construction in Utah. Fervo says Cape Station will be the world’s largest geothermal plant, capable of someday producing up to 2 gigawatts of power.

Earlier this year, Fervo raised $206 million to put toward the development of Cape Station. Of that amount, $100 million came from Breakthrough Energy Catalyst, a green tech investment program backed by Gates, according to Inc.com.

The first phase of Cape Station is scheduled to be completed in 2026, with first-year power generation pegged at 100 megawatts. An additional 500 megawatts of power-producing capacity is slated to go online in 2028.

“Geothermal is one of the most promising ways to deliver clean energy that’s reliable and affordable,” Gates wrote.

In the blog post, Gates praised the simplicity of geothermal energy.

“The interior of the Earth is incredibly hot, and the deeper you go, the hotter the ground becomes,” he explained. “If you pump fluid deep enough to be warmed by this heat and then pump it back to the surface, you can turn the hot liquid into steam and use it to spin turbines and generate electricity — just like many other types of power plants.”

Gates noted that horizontal drilling is one of Fervo’s biggest innovations. The company extends its wells horizontally by as much as 5,000 feet at the deepest point. It couples horizontal drilling with hydraulic fracturing, or fracking, to extract geothermal energy from rock formations.

Most wells at Cape Station are 8,000 to 9,000 feet deep, and the deepest one is 15,000 feet below the surface, Gates pointed out.

Gates also emphasized the water-conserving, closed-system setup at Cape Station.

“Geothermal energy is one of the more climate-friendly sources of power, but one of its downsides is how much water it uses. … Fervo’s technology captures all the water that would’ve been lost and recirculates it underground to keep the system running,” he wrote.

In his conversation with S&P Global's Daniel Yergin, Bill Gates discussed AI, Texas as an energy transition hub, and more. Photo via CERAWeek

Bill Gates talks AI, future of energy at CERAWeek address in Houston

overheard

Bill Gates, renowned co-founder of Microsoft and founder of Breakthrough Energy, took the CERAWeek stage to a standing-room-only crowd to discuss his thoughts on the future of energy.

He was joined in conversation with Daniel Yergin, author and vice chairman of S&P Global, at the luncheon on Thursday, March 21. His remarks touched on three themes within the energy transition.

Texas as a hub for energy transition

Yergin started off the conversation inquiring about Gates and his recent tour around Texas, which included visiting energy companies' plants and facilities and their local communities. Though it might surprise people, given the history of oil and gas in the state, Texas has a strong presence in the energy transition, Gates says.

“There is some irony in the fact that so many of the capabilities to embrace (the energy transition) are here in Texas, whether it's the workforce or the permitting,” he says at the event.

Gates adds that while most of the portfolio companies at Breakthrough Energy were founded on the coasts, many turn to Texas when it comes time for their first commercial pilot.

He addressed a progress report on the energy transition as a whole.

“It’s really starting to move. There’s a lot of exciting technologies, and a lot of the big companies are coming in,” he says, specifically noting energy companies' presence at COP28.

“A heroic effort is beginning — I’m very excited about it. But we shouldn’t underestimate how difficult it will be,” he says. “There’s a lot of things that have to happen for these projects to go ahead. It’s far more difficult than anything I worked on at Microsoft.”

Steel and nuclear have big potential for disruption

Gates continued this thought but highlighting that some industries are less advanced than others.

“We’re just at the beginning of many things," he adds, noting that "the steel industry today is 99 percent the traditional process."

With that, steel has a lot of potential to be disrupted, and Breakthrough Energy has two companies working to make the industry greener, but it's an industry that's going to take time to evolve.

Nuclear is another sector Gates is excited about but is developing at a slower pace. Breakthrough Energy has five portfolio companies focused on Nuclear, including TerraPower, which Gates co-founded in 2006.

Despite nearly two decades of development, Gates says TerraPower is a "fast-moving" nuclear company in comparison to other companies out there.

AI's impact is still to be determined

The topic of artificial intelligence inevitably came up, and Gates explains that the technology has come a long way. Microsoft owns a portion of OpenAI, which created ChatGPT. Gates says he expected AI to evolve and to be able to be programmed to understand information to take longer to develop.

“We have achieved a threshold — an unusual threshold because we know how we’ve caused the knowledge represented, but we don’t understand how at a semantic level how that knowledge is being represented,” Gates says.

AI's current applications are within white collar activities, Gates explains, citing writing a regulatory permit or looking at evidence in a lawsuit. He explains that current AI capabilities could continually grow or remain stagnant for a while, he isn't sure.

"The thing that’s daunting is we don’t know how quickly it will improve," he adds.

Gates didn't comment on energy specific AI applications but noted that AI has advanced far past robotics, which would target blue collar roles.

Here's what to attend at CERAWeek. Photo via CERAWeek.com

Things to know this week: Houstonian's guide to CERAWeek 2024

take note

Editor's note: Dive headfirst into the new week with things to catch up on in Houston's energy transition — a special CERAWeek 2024 edition. Check out these must-attend events at the conference, which is going on all week in Downtown Houston.

Monday, March 18, at 4:30 pm — IRA at One and a Half Years: What is the impact?

Billions of dollars have poured into the energy sector to spur investment and production of technology to fight climate change through the passing of the Inflation Reduction Act (IRA) 18 months ago. Experts weigh in on the successes so far and any challenges and obstacles that have arisen.

Roman Kramarchuk, S&P Global Commodity Insights Head – Climate Markets and Policy Analytics
Jigar Shah, United States Department of Energy Director, Loan Programs Office
Kevin Gresham, RWE Senior Vice President, Government Relations & Regulatory Affairs
Steve Smith, National Grid Group Head of Strategy, Innovation and Market Analytics, National Grid | President, National Grid Partners

Tuesday, March 19, at 1 pm — Everything is Bigger in Texas: Building Hydrogen City

Announced in 2022, the largest green hydrogen production, storage and transport hub is being developed in South Texas. It will be powered by behind-the-meter solar and wind and the first phase is expected to produce 1/4 million tonnes of green hydrogen per year. The project developers will provide an update on the early stages of the project.

Toshiaki Takimoto, INPEX Corporation Director, Senior Managing Executive Officer, Corporate Strategy & Planning and Head of Net Zero Business
Kenneth Medlock, Rice University, Baker Institute Senior Director, Center for Energy Studies
Noah Feingold, S&P Global Consulting Associate Director
Brian Maxwell, Green Hydrogen International Founder & Chief Executive Officer

Wednesday, March 20, at 1 pm — Houston Energy Initiative Energy Venture Day and Pitch Competition

Join The Rice Alliance for Technology and Entrepreneurship, the Houston Energy Transition Initiative and the Texas Entrepreneurship Exchange for Energy (TEX-E) for the third annual Energy Venture Day and Pitch Competition at CERAWeek. The pitch day will feature more than 40 energy ventures driving efficiency and advancements toward the energy transition. The fast-paced competition is designed to connect energy startups with venture capitalists, corporate innovation groups, industry leaders, academics and service providers.

Read more about the event here.

Thursday, March 21, at 1 pm — Luncheon & Dialogue with Bill Gates

Legendary Microsoft founder Bill Gates, who founded Breakthrough Energy and TerraPower, is headed to town for the 2024 CERAWeek. Gates will be featured in a luncheon fireside chat with S&P Global's Daniel Yergin.

HETI House

Drop by the Houston Energy Transition Initiative's HETI House at CERAWeek for a tour or one of the fireside chats.

Commercializing low carbon technology: unique partnerships between industry and academia

Woodside Energy + Rice University

Monday, March 18 | 2 p.m.

Tony Almond – VP of Technology & Innovation, Woodside Energy
Aditya Mohite – Associate Professor, Chemical and Biomolecular Engineering; Associate Professor, Materials Science and Nanoengineering, Rice University

In 2024, Woodside Energy and Rice University in Houston announced a five-year technology collaboration aimed at reducing greenhouse gas emissions and providing lower carbon solutions. Woodside will provide $12.5 million to fund the creation of the Woodside-Rice Decarbonization Accelerator, an initiative that aims to bring breakthrough decarbonization technology from the Rice labs to market, with a specific focus on manufacturing products derived from captured carbon dioxide and methane. Specifically, Rice hopes to leverage cold plasma technology, a unique approach to breaking down carbon dioxide. These products have potential applications to make better batteries, transistors, and other critical materials for energy technologies.

Investing in our academic institutions and talent in the energy capital of the world

Shell + University of Houston Energy Transition Institute

Tuesday, March 19 | 9:30 a.m.

Jenny Philip, Energy Transition U.S. Senior Advisor, Shell
Scott Nyquist, Energy Advisory Board, University of Houston. Vice-Chair, Houston Energy Transition Initiative, Greater Houston Partnership
Ramanan Krishnamoorti, Chief Energy Officer, University of Houston

Funded by Shell USA, Inc and Shell Global Solutions, US Inc, the University of Houston’s new Energy Transition Institute (ETI) empowers the next generation of energy leaders; develops and accelerates energy solutions, including hydrogen, carbon management and circular materials at scale; and informs policies to address our most pressing challenge to provide secure, reliable, affordable and sustainable energy for all. Learn more about how University of Houston’s ETI is driving research, innovation and workforce development to support the transition to a low-carbon, energy-abundant future.

How Houston Leads: Engaging Communities and Creating Opportunity in the Energy Transition

Calpine + Houston Energy Transition Initiative

Wednesday, March 20 | 10 a.m.

Brett Kerr, Vice President, External Affairs, Calpine
Jane Stricker, Houston Energy Transition Initiative + Greater Houston Partnership

Houston has long been regarded as the Energy Capital of the World. As the industry continues to innovate and deploy projects for an energy-abundant, low-carbon future, engaging communities and creating opportunity for all will be critical. In this session, Jane and Brett will discuss the engagement approaches leading energy companies are putting into practice to expand opportunity for all communities. Come learn about best practices, key challenges and new methods for building sustained relationships with communities.

Scaling carbon-neutral gasoline – feed to construction

HIF Global + Bechtel

Thursday, March 21 | 10 a.m.

Brooke Vandygriff, Chief Operations Officer, HIF USA
Rich Wall, Principal Vice President & General Manager Downstream, Chemicals & Advanced Fuels, Bechtel

HIF Global, the world’s leading eFuels company, has selected Bechtel Energy, Siemens Energy, and Topsoe to conduct the front-end engineering and design (“FEED”) of a facility to be constructed in Matagorda County, Texas, to produce carbon-neutral gasoline. When operational, the HIF Matagorda eFuels Facility will produce fuel that can be dropped-in to vehicles in use today without any modification to existing engines or the infrastructure on which they depend. Come hear more about this innovative technology and the Matagorda facility from Bechtel Energy and HIF Global.

24/7 carbon-free energy: from startup to scale in houston

Mitsubishi Heavy Industries + Fervo Energy

Thursday, March 21 | 2 p.m.

Tim Latimer, Chief Executive Officer, Fervo Energy
Takajiro Ishikawa, President & CEO, Mitsubishi Heavy Industries

Mitsubishi Heavy Industries (MHI) announced its investment in Fervo Energy (Fervo), an innovative enhanced geothermal technology startup headquartered in Houston, Texas. MHI joins a consortium of strategic investors, including Devon Energy Corporation (Devon), Marunouchi Innovation Partners (MIP). Over the last few years, Fervo has adapted innovations pioneered by the oil and gas industry, such as horizontal drilling and distributed fiber optic sensing, to make reservoirs of hot rock that exist beneath the earth’s surface into practical, economically viable, carbon-free sources of energy that can be used as heat sources both for industrial and power generation. Learn more about how this clean energy startup is commercializing solutions for the transitions by building relationships with world leading energy and technology companies.

Energy Tech Innovation Lounge (no badge required)

Houston Innovation Leaders and Founders is hosting a free Energy Tech Innovation Lounge that's open daily from 10 am to 5 pm at 808 Travis Street. Each day has programing and networking — click here to learn more.

Things are heating up in Utah for Fervo Energy. Photo via fervoenergy.com

Houston company breaks ground on 'world's largest' geothermal project with next-generation tech

coming soon

Houston-based cleantech startup Fervo Energy has broken ground on what it's describing as the "world’s largest next-gen geothermal project."

Fervo says the a 400-milliwatt geothermal energy project in Cape Station, Utah, will start delivering carbon-free power to the grid in 2026, with full-scale production beginning in 2028.

The project, in southwest Utah, is about 240 miles southwest of Salt Lake City and about 240 miles northeast of Las Vegas. Cape Station is adjacent to the U.S. Department of Energy’s Frontier Observatory for Research in Geothermal Energy (FORGE) and near the Blundell geothermal power plant.

The company says Cape Station will generate about 6,600 construction jobs and 160 full-time jobs.

“Beaver County, Utah, is the perfect place to deploy our next-generation geothermal technology,” Tim Latimer, co-founder and CEO of Fervo, says in a news release. “The warmth and hospitality we have experienced from the communities of Milford and Beaver have allowed us to embark on a clean energy journey none of us could have imagined just a few years ago.”

In February, the U.S. Bureau of Land Management gave its blessing to the project, allowing Fervo to undertake exploration activities at the site.

“Geothermal innovations like those pioneered by Fervo will play a critical role in extending Utah’s energy leadership for generations to come,” says Utah Gov. Spencer Cox, who attended the groundbreaking ceremony.

Since being founded in 2017, Fervo has raised more than $180 million in funding. Its highest-profile investors are billionaires Jeff Bezos, Richard Branson and Bill Gates. They’re backing Fervo through Breakthrough Energy Ventures, whose managing director sits on Fervo’s board of directors.

Other investors include the Canada Pension Plan Investment Board (CPP Investments), DCVC, Devon Energy, Liberty Energy, Helmerich & Payne, Macquarie, the Grantham Foundation for the Protection of the Environment, Impact Science Ventures, and Prelude Ventures.

Fervo aims to generate more than one gigawatt of geothermal energy by 2030. On average, one gigawatt of power can provide electricity for 750,000 homes. Two coal-fired power plants can generate roughly the same amount of electricity.

Earlier this year, Fervo announced results of a test at Nevada’s Project Red site, which will supply power to Google data centers in the Las Vegas area. Fervo says the 30-day well test established Project Red as the “most productive enhanced geothermal system in history,” the company says. The test generated 3.5 megawatts of electricity.

In 2021, Fervo and Google signed the world’s first corporate agreement to produce geothermal power. Under the deal, Fervo will generate five megawatts of geothermal energy for Google through the Nevada project, which is set to go online later this year.

The world can't keep on with what it's doing and expect to reach its goals when it comes to climate change. Radical innovations are needed at this point, writes Scott Nyquist. Photo via Getty Images

Only radical innovation can get the world to its climate goals, says this Houston expert

guest column

Almost 3 years ago, McKinsey published a report arguing that limiting global temperature rises to 1.5 degrees Celsius above pre-industrial levels was “technically achievable,” but that the “math is daunting.” Indeed, when the 1.5°C figure was agreed to at the 2015 Paris climate conference, the assumption was that emissions would peak before 2025, and then fall 43 percent by 2030.

Given that 2022 saw the highest emissions ever—36.8 gigatons—the math is now more daunting still: cuts would need to be greater, and faster, than envisioned in Paris. Perhaps that is why the Intergovernmental Panel on Climate Change (IPCC) noted March 20 (with “high confidence”) that it was “likely that warming will exceed 1.5°C during the 21st century.”

I agree with that gloomy assessment. Given the rate of progress so far, 1.5°C looks all but impossible. That puts me in the company of people like Bill Gates; the Economist; the Australian Academy of Science, and apparently many IPCC scientists. McKinsey has estimated that even if all countries deliver on their net zero commitments, temperatures will likely be 1.7°C higher in 2100.

In October, the UN Environment Program argued that there was “no credible pathway to 1.5°C in place” and called for “an urgent system-wide transformation” to change the trajectory. Among the changes it considers necessary: carbon taxes, land use reform, dietary changes in which individuals “consume food for environmental sustainability and carbon reduction,” investment of $4 trillion to $6 trillion a year; applying current technology to all new buildings; no new fossil fuel infrastructure. And so on.

Let’s assume that the UNEP is right. What are the chances of all this happening in the next few years? Or, indeed, any of it? President Obama’s former science adviser, Daniel Schrag, put it this way: “ Who believes that we can halve global emissions by 2030?... It’s so far from reality that it’s kind of absurd.”

Having a goal is useful, concentrating minds and organizing effort. And I think that has been the case with 1.5°C, or recent commitments to get to net zero. Targets create a sense of urgency that has led to real progress on decarbonization.

The 2020 McKinsey report set out how to get on the 1.5°C pathway, and was careful to note that this was not a description of probability or reality but “a picture of a world that could be.” Three years later, that “world that could be” looks even more remote.

Consider the United States, the world’s second-largest emitter. In 2021, 79 percent of primary energy demand (see chart) was met by fossil fuels, about the same as a decade before. Globally, the figures are similar, with renewables accounting for just 12.5 percent of consumption and low-emissions nuclear another 4 percent. Those numbers would have to basically reverse in the next decade or so to get on track. I don’t see how that can happen.

Credit: Energy Information Administration

But even if 1.5°C is improbable in the short term, that doesn’t mean that missing the target won’t have consequences. And it certainly doesn’t mean giving up on addressing climate change. And in fact, there are some positive trends. Many companies are developing comprehensive plans for achieving net-zero emissions and are making those plans part of their long-term strategy. Moreover, while global emissions grew 0.9 percent in 2022, that was much less than GDP growth (3.2 percent). It’s worth noting, too, that much of the increase came from switching from gas to coal in response to the Russian invasion of Ukraine; that is the kind of supply shock that can be reversed. The point is that growth and emissions no longer move in lockstep; rather the opposite. That is critical because poorer countries are never going to take serious climate action if they believe it threatens their future prosperity.

Another implication is that limiting emissions means addressing the use of fossil fuels. As noted, even with the substantial rise in the use of renewables, coal, gas, and oil are still the core of the global energy system. They cannot be wished away. Perhaps it is time to think differently—that is, making fossil fuels more emissions efficient, by using carbon capture or other technologies; cutting methane emissions; and electrifying oil and gas operations. This is not popular among many climate advocates, who would prefer to see fossil fuels “stay in the ground.” That just isn’t happening. The much likelier scenario is that they are gradually displaced. McKinsey projects peak oil demand later this decade, for example, and for gas, maybe sometime in the late 2030s. Even after the peak, though, oil and gas will still be important for decades.

Second, in the longer term, it may be possible to get back onto 1.5°C if, in addition to reducing emissions, we actually remove them from the atmosphere, in the form of “negative emissions,” such as direct air capture and bioenergy with carbon capture and storage in power and heavy industry. The IPCC itself assumed negative emissions would play a major role in reaching the 1.5°C target; in fact, because of cost and deployment problems, it’s been tiny.

Finally, as I have argued before, it’s hard to see how we limit warming even to 2°C without more nuclear power, which can provide low-emissions energy 24/7, and is the largest single source of such power right now.

None of these things is particularly popular; none get the publicity of things like a cool new electric truck or an offshore wind farm (of which two are operating now in the United States, generating enough power for about 20,000 homes; another 40 are in development). And we cannot assume fast development of offshore wind. NIMBY concerns have already derailed some high-profile projects, and are also emerging in regard to land-based wind farms.

Carbon capture, negative emissions, and nuclear will have to face NIMBY, too. But they all have the potential to move the needle on emissions. Think of the potential if fast-growing India and China, for example, were to develop an assembly line of small nuclear reactors. Of course, the economics have to make sense—something that is true for all climate-change technologies.

And as the UN points out, there needs to be progress on other issues, such as food, buildings, and finance. I don’t think we can assume that such progress will happen on a massive scale in the next few years; the actual record since Paris demonstrates the opposite. That is troubling: the IPCC notes that the risks of abrupt and damaging impacts, such as flooding and crop yields, rise “with every increment of global warming.” But it is the reality.

There is one way to get us to 1.5°C, although not in the Paris timeframe: a radical acceleration of innovation. The approaches being scaled now, such as wind, solar, and batteries, are the same ideas that were being discussed 30 years ago. We are benefiting from long-term, incremental improvements, not disruptive innovation. To move the ball down the field quickly, though, we need to complete a Hail Mary pass.

It’s a long shot. But we’re entering an era of accelerated innovation, driven by advanced computing, artificial intelligence, and machine learning that could narrow the odds. For example, could carbon nanotubes displace demand for high-emissions steel? Might it be possible to store carbon deep in the ocean? Could geo-engineering bend the curve?

I believe that, on the whole, the world is serious about climate change. I am certain that the energy transition is happening. But I don’t think we are anywhere near to being on track to hit the 1.5°C target. And I don’t see how doing more of the same will get us there.

------

Scott Nyquist is a senior advisor at McKinsey & Company and vice chairman, Houston Energy Transition Initiative of the Greater Houston Partnership. The views expressed herein are Nyquist's own and not those of McKinsey & Company or of the Greater Houston Partnership. This article originally ran on LinkedIn.

Ad Placement 300x100

Ad Placement 300x600

CultureMap Emails are Awesome

Property Showcase

Rice University partners with Australian co. to boost mineral processing, battery innovation

critical mineral partnership

Rice University and Australian mineral exploration company Locksley Resources have joined together in a research partnership to accelerate the development of antimony processing in the U.S. Antimony is a critical mineral used for defense systems, electronics and battery storage.

Rice and Locksley will work together to develop scalable methods for extracting and utilizing antimony. Currently, the U.S. relies on imports for nearly all refined antimony, according to Rice.

Locksley will fund the research and provide antimony-rich feedstocks and rare earth elements from a project in the Mojave Desert. The research will explore less invasive hydrometallurgical techniques for antimony extraction and explore antimony-based materials for use in batteries and other energy storage applications.

“This strategic collaboration with Rice marks a pivotal step in executing Locksley’s U.S. strategy,” Nathan Lude, chairman of Locksley Resources, said in a news release. “By fast-tracking our research program, we are helping rebuild downstream capacity through materials innovation that the country urgently requires.”

Pulickel Ajayan, the Benjamin M. and Mary Greenwood Anderson Professor of Materials Science and Nanoengineering at Rice, is the principal investigator of the project.

“Developing scalable, domestic pathways for antimony processing is not only a scientific and engineering challenge but also a national strategic priority,” Ajayan said in the news release. “By combining Rice’s expertise in advanced materials with Locksley’s resources, we can address a critical supply chain gap and build collaborations that strengthen U.S. energy resilience.”

The Rice Advanced Materials Institute (RAMI) will play a major role in supporting the advancement of technology and energy-storage applications.

“This partnership aligns with our mission to lead in materials innovations that address national priorities,” Lane Martin, director of RAMI, said in a news release. “By working with Locksley, we are helping to build a robust domestic supply chain for critical materials and support the advancement of next-generation energy technologies.”

Expert examines how far Texas has come in energy efficiency

Guest Column

Texas leads the nation in energy production, providing about one-fourth of the country’s domestically produced primary energy. It is also the largest energy-consuming state, accounting for about one-seventh of the nation’s total energy use, and ranks sixth among the states in per capita energy consumption.

However, because Texas produces significantly more energy than it consumes, it stands as the nation’s largest net energy supplier. October marked National Energy Awareness Month, so this is an ideal time to reflect on how far Texas has come in improving energy efficiency.

Progress in Clean Energy and Grid Resilience

Texas continues to lead the nation in clean energy adoption and grid modernization, particularly in wind and solar power. With over 39,000 MW of wind capacity, Texas ranks first in the country in wind-powered electricity generation, now supplying more than 10% of the state’s total electricity.

This growth was significantly driven by the Renewable Portfolio Standard (RPS), which requires utility companies to produce new renewable energy in proportion to their market share. Initially, the RPS aimed to generate 10,000 MW of renewable energy capacity by 2025. Thanks to aggressive capacity building, this ambitious target was reached much earlier than anticipated.

Solar energy is also expanding rapidly, with Texas reaching 16 GW of solar capacity as of April 2024. The state has invested heavily in large-scale solar farms and supportive policies, contributing to a cleaner energy mix.

Texas is working to integrate both wind and solar to create a more resilient and cost-effective grid. Efforts to strengthen the grid also include regulatory changes, winterization mandates, and the deployment of renewable storage solutions.

While progress is evident, experts stress the need for continued improvements to ensure grid reliability during extreme weather events, when we can’t rely on the necessities for these types of energy sources to thrive. To put it simply, the sun doesn’t always shine, and the wind doesn’t always blow.

Federal Funding Boosts Energy Efficiency

In 2024, Texas received $22.4 million, the largest share of a $66 million federal award, from the U.S. Department of Energy’s Energy Efficiency Revolving Loan Fund Capitalization Grant Program.

The goal of this funding is to channel federal dollars into local communities to support energy-efficiency projects through state-based loans and grants. According to the DOE, these funds can be used by local businesses, homeowners, and public institutions for energy audits, upgrades, and retrofits that reduce energy consumption.

The award will help establish a new Texas-based revolving loan fund modeled after the state’s existing LoanSTAR program, which already supports cost-effective energy retrofits for public facilities and municipalities. According to the Texas Comptroller, as of 2023, the LoanSTAR program had awarded more than 337 loans totaling over $600 million.

In addition to expanding the revolving loan model, the state plans to use a portion of the DOE funds to offer free energy audit services to the public. The grant program is currently under development.

Building on this momentum, in early 2025, Texas secured an additional $689 million in federal funding to implement the Home Energy Performance-Based, Whole House (HOMES) rebate program and the Home Electrification and Application Rebate (HEAR) program.

This investment is more than five times the state’s usual energy efficiency spending. Texas’s eight private Transmission and Distribution Utilities typically spend about $110 million annually on such measures. The state will have multiple years to roll out both the revolving loan and rebate programs.

However, valuable federal tax incentives for energy-efficient home improvements are set to expire on December 31, 2025, including:

The Energy Efficiency Home Improvement Credit allows homeowners to claim up to $3,200 per year in federal income tax credits, covering 30% of the cost of eligible upgrades, such as insulation, windows, doors, and high-efficiency heating and cooling systems.
The Residential Clean Energy Credit provides a 30% income tax credit for the installation of qualifying clean energy systems, including rooftop solar panels, wind turbines, geothermal heat pumps, and battery storage systems.

As these incentives wind down, the urgency grows for Texas to build on the positive gains from the past several years despite reduced federal funding. The state has already made remarkable strides in clean energy production, grid modernization, and energy-efficiency investments, but the path forward requires a strategic and inclusive approach to energy planning. Through ongoing state-federal collaboration, community-driven initiatives, and forward-looking policy reforms, Texas can continue its progress, ensuring that future energy challenges are met with sustainable and resilient solutions.

---

Sam Luna is director at BKV Energy, where he oversees brand and go-to-market strategy, customer experience, marketing execution, and more.

Meta to buy all power from new ENGIE Texas solar farm

power purchase

Meta, the parent company of social media platform Facebook, has agreed to buy all of the power from a $900 million solar farm being developed near Abilene by Houston-based energy company ENGIE North America.

The 600-megawatt Swenson Ranch solar farm, located in Stonewall County, will be the largest one ever built in the U.S. by ENGIE. The solar farm is expected to go online in 2027.

Meta will use electricity generated by the solar farm to power its U.S. data centers. All told, Meta has agreed to purchase more than 1.3 gigawatts of renewable energy from four ENGIE projects in Texas.

“This project marks an important step forward in the partnership between our two companies and their shared desire to promote a sustainable and competitive energy model,” Paulo Almirante, ENGIE’s senior executive vice president of renewable and flexible power, said in a news release.

In September, ENGIE North America said it would collaborate with Prometheus Hyperscale, a developer of sustainable liquid-cooled data centers, to build data centers at ENGIE-owned renewable energy and battery storage facilities along the I-35 corridor in Texas. The corridor includes Austin, Dallas-Fort Worth, San Antonio and Waco.

The first projects under the ENGIE-Prometheus umbrella are expected to go online in 2026.

ENGIE and Prometheus said their partnership “brings together ENGIE's deep expertise in renewables, batteries, and energy management and Prometheus' highly efficient liquid-cooled data center design to meet the growing demand for reliable, sustainable compute capacity — particularly for AI and other high-performance workloads.”

View All Listings

ENERGYCAPITALHTX EMAILS ARE AWESOME