Quaise Energy Raises $134M for Superhot Geothermal

Quaise Energy raised $134 million in its Series B financing, the company said Wednesday. Prelude Ventures led the round. Strategic investments came from JERA and Idemitsu, two of Japan's largest energy companies. Nearly all existing investors, including Safar Partners, also participated. Additional equity and debt capital is expected to close soon.

The company uses millimeter-wave drilling technology developed at the Massachusetts Institute of Technology to tap heat deep underground. Temperatures there exceed 400 degrees Celsius. That heat can generate steam to drive turbines, producing baseload power without the intermittency of wind or solar.

Quaise describes itself as both a technology developer and a project builder. It aims to produce power at a cost competitive with fossil-fuel and nuclear plants. The drilling method was developed over more than a decade at MIT's Plasma Science and Fusion Center.

For the geothermal industry, the round is the largest in recent memory. Most early-stage funding has gone to enhanced geothermal systems, which fracture hot rock closer to the surface. Quaise targets deeper rock that does not depend on specific geology. If the technology works, the resource could be available almost anywhere.

JERA and Idemitsu are not typical early-stage investors in U.S. energy startups. JERA is Japan's biggest power generator. Idemitsu is a refiner. Both are seeking new energy sources after the Fukushima disaster. The deal gives them a stake in a technology that could eventually supply power to Japan.

Quaise has not yet built a commercial plant. The Series B funds further drilling tests and site development. The company expects to close the full round imminently and will provide updates on drilling progress later this year.