Microsoft Corp. (NASDAQ:MSFT) co-founder Bill Gates and Breakthrough Energy are backing Fervo Energy‘s Cape Station project in Beaver County, Utah. The facility will become the world’s largest enhanced geothermal power plant, generating 100 MW by 2026 and expanding to 500 MW by 2028.

Currently, less than 1% of U.S. energy comes from geothermal sources.

In his September 4 Gates Notes post “Turn up the heat,” Gates detailed his visit to Cape Station alongside Senator John Curtis, highlighting Utah’s leadership in energy innovation. “I used to think geothermal would never be more than 5 percent of the global energy mix. But now I believe it could eventually supply up to 20 percent,” Gates stated.

Revolutionary Technology Approach

Fervo uses horizontal drilling techniques from the oil and gas industry, allowing wells to extend 5,000 feet horizontally at depths of up to 15,000 feet, which is about the height of 50 stacked Statues of Liberty. This method lowers costs and makes geothermal energy possible in areas beyond typical tectonic plate regions.

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Their pilot project in Nevada, launched in 2023, has a 3.5 MW capacity. The Cape Station project is a significant expansion, with 20 out of 24 planned wells already drilled.

Closed-Loop Innovation

Gates noted Cape Station's closed-loop system prevents visible steam by capturing and reusing water underground. He explained that this technology “saves all the water that would've been wasted” in conventional geothermal plants.

Energy Independence Impact

Sixty percent of Fervo's team comes from oil and gas backgrounds, so they need little retraining. Gates highlighted the project's importance in supporting U.S. energy independence, pointing out that geothermal provides consistent, 24/7 power, unlike the intermittent nature of wind and solar energy.

Traditional energy sectors declined on Friday, with the Energy Select Sector SPDR Fund (NYSE:XLE) down 0.59% and iShares S&P 500 Energy Sector UCITS ETF (LON: IUES) down 0.44%.

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