Senators from both parties introduced the Next-Generation Geothermal Research and Development Act in April. The bill aims to direct the Department of Energy to support the development and commercialization of next-generation geothermal energy systems, which utilize natural heat from below the Earth's surface.

Enhanced geothermal systems (EGS) fracture underground rock hydraulically by pumping pressurized fluid into one well and collecting steam or hot water from another. Companies are developing new methods, including Quaise, which has roots at the Massachusetts Institute of Technology (MIT). Quaise uses millimeter wave drilling, a technology that sends electromagnetic waves in the microwave millimeter wave spectrum to melt and vaporize rock. The company is developing a project site in Oregon and aims to have it operational by 2030.

"Millimetre wave drilling really enables you to access super-hot geothermal just about anywhere in the world," says Harry Kelso, Quaise's communications manager. "We're essentially just recycling the water over and over," he said regarding the system. "Geothermal today is still more expensive because you are not getting as much power out of the well as you would if you were using that well for fossil fuel," Kelso said. Quaise targets temperatures between 300C and 500C to improve the economics of geothermal energy. "It allows you to get 10 times more energy per well from geothermal, which changes the economics and the power potential of geothermal," Kelso said.

Fervo Energy, a Texas-based company, became the first next-generation geothermal company to become publicly traded in May, with an initial valuation of approximately $7.7 billion. Fervo Energy plans for geothermal power from its Utah plant to cost around $7,000 per kilowatt of electricity. The company has an agreement to sell its energy to Google. Breakthrough Energy, a venture by Microsoft founder Bill Gates, backs Fervo Energy.

"It's the same techniques and up to a point it's the same industry as well," says Gernot Wagner, a climate economist at Columbia Business School. "Based on where we are, moving much faster, much bigger in the direction of using much more geothermal, frankly, is all good news," Wagner said. "Geothermal is a technology and more secure," he added. Project Drawdown notes that early geothermal projects carry a risk of cost overruns. The International Energy Agency states that data center projects alone will not be enough to move the needle for next-gen geothermal firms.

Why It Matters

The introduction of legislation and commercial milestones signal increased interest and investment in next-generation geothermal energy. These developments expand the potential for geothermal energy to be a more widespread and economically viable power source, moving beyond traditional geographical limitations through advanced drilling and extraction methods. The federal support and private sector advancements could contribute to a broader shift in energy sources.