Next-generation geothermal will soon power Southern California’s grid

California already gets some of its clean electricity from geothermal power plants, which harness the heat and steam found naturally near the earth’s surface. Now, the state is poised to add hundreds more megawatts of geothermal to its overall energy mix — only instead of drawing from local geysers and hot springs, the power will come from a cutting-edge project in Utah.

On Tuesday, Fervo Energy announced that it secured power purchase agreements with the utility giant Southern California Edison (SCE). The geothermal startup uses oil-and-gas drilling techniques to tap heat from deep underground. Fervo began construction last fall on an ​“enhanced geothermal” project in Beaver County, Utah, which is expected to generate nearly 400 MW of around-the-clock electricity when it reaches full production in 2028.

SCE agreed to buy a total of 320 MW of power from Fervo’s $2 billion Cape Station project, or enough to power roughly 350,000 homes in Southern California. The companies declined to disclose the value of the power purchase agreements. But in terms of megawatts, the deal is the largest of its kind for any next-generation geothermal project worldwide, according to Fervo.

“It’s rapidly becoming apparent that [geothermal] is an incredibly meaningful participant” in solving the shortage of clean, firm energy, said Sarah Jewett, Fervo’s vice president of strategy — meaning energy that is always available, unlike intermittent wind and solar power. 

“Geothermal hasn’t really been on the map,” she told Canary Media. ​“But all of a sudden, we’ve switched that really quickly.”

Houston-based Fervo is one of dozens of companies in the U.S. and globally that are striving to make it easier and cheaper to access geothermal energy virtually anywhere in the world. Next-generation geothermal technologies have seen a surge of investment and policy support in recent years as companies and states look to fill the growing need for 24/7 power from cities, data centers, and industrial facilities.

In California, utilities are working to satisfy that rising power demand while also meeting the state’s goals for getting 100 percent ​“zero-carbon” electricity by 2045, up from 61 percent in 2022.

“Enhanced geothermal systems complement our abundant wind and solar resources by providing critical baseload [power] when those sources are limited,” David Hochschild, chair of the California Energy Commission, said in a Tuesday press release. SCE and Fervo’s deal ​“is key to ensuring reliability as we continue to transition away from fossil fuels.” 

Unlike existing geothermal plants — which harness naturally available resources — enhanced geothermal systems draw from artificial reservoirs created thousands of feet under the ground. In Fervo’s case, that means using horizontal drilling techniques and fiber-optic sensing tools to make fractures in hot impermeable rocks. Technicians pump those pockets full of water and working fluids at high pressures. The rocks then heat those fluids to produce steam that drives electric turbines.

Fervo, which has raised over $500 million since 2017, began operating its first enhanced geothermal project last November. The 3.5 MW commercial demonstration plant, which is backed by Google, now supplies power directly to the Las Vegas–based utility NV Energy.

The same three partners are taking part in a new initiative — one that Google says is designed to accelerate the deployment of ​“24/7 carbon-free energy technologies” like next-generation geothermal and long-duration energy storage, in Nevada and nationwide.

Under a proposed agreement, unveiled earlier this month, NV Energy would buy power from a 115 MW geothermal plant that Fervo is planning to build in Nevada. The utility would then sell that clean electricity at a premium to Google, which operates massive data centers in the state. Google, in exchange, would be credited for the energy and generation capacity on its sizable electric bills. (The proposal is pending review by Nevada regulators.)

But the deal Fervo just struck with Southern California is based on more traditional power purchase agreements, with the utility agreeing to pay a fixed rate for every kilowatt-hour of electricity the Utah geothermal plant generates. SCE’s commitment will play out over two 15-year contracts that mirror the project’s staggered construction phases.

At Cape Station, Fervo has drilled 12 of what will eventually become 100 geothermal wells on public and private lands in western Utah. Jewett said the project is ​“on track and on time” to deliver the first 90 MW in 2026, with the rest of the nearly 400 MW slated to come online two years after that. Electricity will travel from Cape Station over high-voltage transmission lines, first to Nevada and then over the California border into SCE’s service territory.

Fervo has also struck a deal to sell another 53 MW of power from the project to California community choice aggregators — meaning Cape Station’s full clean electricity capacity is all but sold out.

“We’re seeing an incredibly robust demand for firm, clean power right now coming from not only utilities but also tech companies and all sorts of different users,” Jewett said. ​“And it’s really fun to be able to [meet] that demand with real projects.”