Investment

Another climate emergency initiative backed by family offices

A hole in the ground 20 kilometres deep could be one answer to a new call from the United Nations for the development of technology to prevent catastrophic climate change.

The big dig is proposed by Quaise Energy, a company backed by investors, including Nat Simons’ Prelude Ventures, which wants to tap into geothermal energy. 

The drilling technology behind Quaise has built on research carried out at the MIT Plasma Science and Fusion Center. It involves the use of a gyrotron using powerful radio frequencies to dig, grind and melt rocks below the earth’s surface, where temperatures reach 500 degrees Celsius. 

The plan is to pump water underground to turn it into steam which is sufficiently hot to generate electricity. If the technology works, Quaise believes it can convert mothballed coal-fired power plants into geothermal generators by 2028.

The company is led by Carlos Araque, former technical director at an MIT funding platform, who was previously technology development manager at Schlumberger.

Quaise has raised $58 million, according to Crunchbase. Its first backer was veteran venture capitalist Vinod Khosla, who belongs to Bill Gates’ Breakthrough clean energy consortium, along with Nat Simons. 

Simons’ Prelude is a determined backer of climate change solutions. Others include Living Carbon, seeking to improve photosynthesis through genetic modification and Verdox, a technology that can remove carbon from aluminium production. His father is the renowned hedge fund manager Jim Simons.

Quaise’s blue-sky backers include Safar Partners – whose operations chief Rob Fleischman is chair of Tiger 21 in Boston – Starlight Ventures; 8090 Partners, a New York family office consortium, Craig Shapiro’s Collaborative Fund and drilling contractor Nabors.

To date, technology has not been widely employed to generate geothermal energy, except where the earth’s crust is thin or cracked – often in the vicinity of volcanoes or earthquakes. A quarter of Iceland’s electricity is generated by geothermal power plants. 

Quaise has few direct rivals. But one of them is Fervo Energy, which has raised $39 million from investors like Capricorn Investment Group, founded by Jeffrey Skoll, Breakthrough Energy and Elemental Excelerator, chaired by Laurene Powell Jobs of Emerson Collective.

Drilling through the earth’s crust can generate fears of earthquakes and fissures. But Quaise says geothermal excavations are not only safe but the most reliable potential source of power: “Geothermal has the power density and scalability of fossil fuels, allowing us to put clean energy on the grid very quickly…it is the only renewable solution with the potential to get us to net-zero by 2050.”

At the start of April, the UN climate panel published an updated report, arguing that the earth is now in severe danger of warming beyond a catastrophic 2 degrees. 

“You need credible commitments on public policy, private investment, innovation, all happening quickly and then being sustained over several decades,” said John Bistline, a climate expert for the Electric Power Research Institute, a contributing author to the UN report. 

 

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