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

geothermal predictions

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

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.

From Your Site Articles

Houston's Fervo Energy has secured new funding for Cape Station, its Utah geothermal energy plant. Photo courtesy Fervo Energy.

Fervo Energy lands $200 million in capital for new geothermal project

fresh funding

Houston-based Fervo Energy, a producer of geothermal power, has secured $205.6 million in capital to help finance its geothermal project in southern Utah.

The money will go toward the first and second phases of Cape Station, a geothermal energy plant being developed in Beaver County, Utah. Beaver County is roughly an equal distance between Salt Lake City and Las Vegas.

The $205.6 million in capital came from three sources:

$100 million in equity from Breakthrough Energy Catalyst, a Kirkland, Washington-based platform that invests in emissions-reducing projects.
$60 million addition to Fervo’s existing loan from Mercuria, a Swiss energy and commodities trader. The revolving loan now totals $100 million.
$45.6 million in additional bridge debt financing from XRL-ALC, an affiliate of Irvington, New York-based X-Caliber Rural Capital. X-Caliber is a USDA-approved lender. The initial bridge loan was $100 million.

The first phase of Cape Station will supply 100 megawatts of carbon-free electricity to the power grid starting next year. Another 400 megawatts of capacity is supposed to go online by 2028. Fervo has permission to expand Cape Station’s capacity to as much as 2 gigawatts. On an annual basis, 2 gigawatts can supply enough electricity to power about 1.4 million homes.

“These investments demonstrate what we’ve known all along: Fervo’s combination of technical excellence, commercial readiness, and market opportunity makes us a natural partner for serious energy capital. The confidence our investors have in Fervo and in the Cape asset affirms that next-generation geothermal is ready to play a defining role in America’s energy future,” David Ulrey, Fervo’s CFO, said in a news release.

Ad Placement 300x100

Ad Placement 300x600

CultureMap Emails are Awesome

Property Showcase

Fervo Energy officially files for initial public offering

going public

Fervo Energy has officially filed for IPO.

The Houston-based geothermal unicorn filed a registration statement on Form S-1 with the U.S. Securities and Exchange Commission on April 17 to list its Class A common stock on the Nasdaq exchange. Fervo intends to be listed under the ticker symbol "FRVO."

The number and price of the shares have not yet been determined, according to a news release from Fervo. J.P. Morgan, BofA Securities, RBC Capital Markets and Barclays are leading the offering.

The highly anticipated filing comes as Fervo readies its flagship Cape Station geothermal project to deliver its first power later this year

"Today, miles-long lines for gasoline have been replaced by lines for electricity. Tech companies compete for megawatts to claim AI market share. Manufacturers jockey for power to strengthen American industry. Utilities demand clean, firm electricity to stabilize the grid," Fervo CEO Tim Latimer shared in the filing. "Fervo is prepared to serve all of these customers. Not with complex, idiosyncratic projects but with a simplified, standardized product capable of delivering around-the-clock, carbon-free power using proven oil and gas technology."

Fervo has been preparing to file for IPO for months. Axios Pro first reported that the company "quietly" filed for an IPO in January and estimated it would be valued between $2 billion and $3 billion.

Fervo also closed $421 million in non-recourse debt financing for the first phase of Cape Station last month and raised a $462 million Series E in December. The company also announced the addition of four heavyweights to its board of directors last week, including Meg Whitman, former CEO of eBay, Hewlett-Packard, and Spring-based HPE.

Fervo reported a net loss of $70.5 million for the 2025 fiscal year in the S-1 filing and a loss of $41.1 million in 2024.

Tracxn.com estimates that Fervo has raised $1.12 billion over 12 funding rounds. The company was founded in 2017 by Latimer and CTO Jack Norbeck.

Houston lawmaker may kill data center tax breaks due to $8B revenue loss

looking at the data

An influential Houston-area state senator is raising concerns about potentially billions of dollars in lost state revenue from tax breaks for Texas data centers—and is pondering legislation that would abolish the tax incentives.

Citing data from the state comptroller’s office, The Texas Tribune reports the state stands to lose nearly $8 billion in revenue from 2026 to 2030 due to sales tax and use tax exemptions for data centers. During the state’s 2025 fiscal year, which ended on Aug. 31, these tax exemptions caused Texas to lose a little over $1 billion, up from an earlier estimate of $130 million.

“These new numbers are extremely concerning, and I will say they’re unsustainable,” Republican state Sen. Joan Huffman, chairwoman of the state Senate Finance Committee, tells The Texas Tribune. “I plan to look at filing legislation to either repeal the exemption or take a very close look at it and see.”

Texas on track to be No. 1 data center market in U.S.

Scrutiny of the tax breaks comes amid an explosion of data center development in Texas, where data provider Aterio identifies nearly 1,000 centers that are operating, under construction or planned.

A report issued in January by Bloom Energy says the state is poised to become the No. 1 U.S. market for data centers within three years. By 2028, according to the report, Texas is projected to exceed 40 gigawatts of data center capacity—representing nearly 30 percent of total U.S. demand.

Among companies benefiting from the data center boom are:

Tech titans like Apple, Google, Meta Platforms, and Microsoft, which are spending billions of dollars to build data centers in Texas.
Spring-based ExxonMobil and Houston-based Chevron, two oil and energy giants that are developing natural gas plants to supply power for data centers.
Houston-based energy technology company Baker Hughes, which is collaborating with Google Cloud to develop AI-enabled power optimization and sustainability software for data centers.
DataBank, Data Foundry, Equinix, Digital Realty, Lumen Technologies, and IBM, all of which operate data centers in the Houston area.

The Texas Legislature will begin debating tax breaks for data centers in July, when Huffman’s Senate Finance Committee meets for an interim hearing before the 2027 legislative session, according to the Tribune.

Data center industry defends tax breaks

Leaders in the data center industry warn that watering down or halting the tax breaks could slow down or even end Texas’ ascent in the data center sector.

A 2025 report commissioned by the Data Center Coalition found that in 2024, data centers provided more than $1.6 billion in state tax revenue and almost $1.6 billion in local tax revenue in Texas. Over the next several years, according to the report, planned development of data centers in the Lone Star State could generate almost $3.8 billion in state tax revenue and more than $4.9 billion in local tax revenue.

In 2024, the Houston area had 8.1 million gross square feet of data centers, with the properties’ real estate investments sitting at $10 billion, according to the report. That year, data centers in the region produced a little over $700 million in state and local tax revenue. About 60 data centers operate in the Houston area.

Watchdog group warns of tax breaks’ danger to state budgets

On the other side of the debate over tax breaks for data centers, a report released last year by Good Jobs First, a nonprofit, nonpartisan watchdog group that tracks economic development incentives, decries the tax breaks as dangerous to state budgets.

“We know of no other form of state spending that is so out of control. Therefore, we recommend that states cancel their data center tax exemptions,” says Good Jobs research analyst Kasia Tarczynska, co-author of the report. “Shy of that, states should amend … legislation to cap how much any facility and company can avoid paying in taxes each year.”

Helix Earth closes $12M round and more Houston energy headlines

Trending News

Editor's note: The top energy transition headlines for the month include Helix Earth's Seed 2 funding and Chevron's plans for a West Texas power plant. Below are the five most-read EnergyCapital stories published April 1-15, 2026:

1. Houston cleantech company closes $12M seed round

Helix Earth is developing a retrofit technology that has the potential to cut HVAC energy use by up to 50 percent. Photo via Getty Images

Houston-based Helix Earth Technologies has closed a $12 million Seed 2 funding round to scale manufacturing of its energy-efficient commercial HVAC add-on technology. Veriten, a Houston-based energy investment firm, led the round. Rua Ventures, Carnrite Ventures, Skywriter LLC and Textbook Ventures also participated. Continue reading.

2. Chevron eyes $7B Texas power plant for Microsoft data center campus

Chevron is in talks with Microsoft and Engine No. 1 about a massive natural gas power plant in Texas. Photo via Getty Images

Software giant Microsoft is negotiating exclusively with Houston-based oil and gas titan Chevron and investment firm Engine No. 1 about the development of a $7 billion power plant in West Texas that would supply electricity for a Microsoft data center campus. Continue reading.

3. 3 strategies to strengthen the Gulf Coast as a global energy hub

The Gulf Coast is one of the most critical energy hubs in the world. Photo via Getty Images.

The Texas-Louisiana Gulf Coast is the backbone of America’s energy and chemical economy. Texas produces roughly 43% of U.S. crude oil and 28% of natural gas, while Texas and Louisiana together account for about half of the nation’s refining capacity, processing 9.3 million barrels of crude per day across 50 refineries. The region also produces approximately 80% of the nation’s primary petrochemicals and ships more than $117 billion in chemical products annually from Texas alone. Continue reading.

4. 8 CERAWeek 2026 takeaways from a new Houston energy leader

Kelsey Kearns (right), the new director of Greentown Houston, shared her takeaways from her first-ever CERAWeek with Energy Capital HTX. Photo courtesy Greentown

My first CERAWeek was a blur. Having top energy executives, policymakers, and technologists all gathered in Houston—over 11,000 of them this year—was both overwhelming and energizing. The theme was “Convergence and Competition: Energy, Technology, and Geopolitics,” and walking through the George R. Brown Convention Center, it was immediately clear that this was no ordinary industry conference. As a first-timer with a Greentown Labs lens, here’s what really stuck with me. Continue reading.

5. Greentown Labs names new COO, appoints new Head of Houston

Lawson Gow and Kelsey Kearns have stepped into new leadership roles at Greentown Labs. Photos courtesy Greentown/LinkedIn

Greentown Labs has reshuffled its leadership, elevating Houston leaders into new roles. Lawson Gow was named COO of the Houston- and Boston-based climatech incubator in February 2026. In his new role, he will focus on optimizing Greentown's structure, building new internal and external systems and developing a plan for growth. Continue reading.

View All Listings

ENERGYCAPITALHTX EMAILS ARE AWESOME