Eavor plots next step for novel geothermal project after rocky start

The startup Eavor Technologies hit a crucial milestone late last year when its flagship geothermal project — a novel closed-loop system — started sending electricity to Germany’s grid. The company had completed the first of four planned loops, and it expected to start construction on its second loop earlier this spring.

Now, Eavor says it’s revising that timeline. The Canadian startup encountered major engineering challenges when drilling its initial wells deep underground near Geretsried, Germany. While Eavor was able to fix those issues, it’s seeking new project partners and investors to help it complete the next-generation geothermal system.

“We’re looking to make Loop 2 happen as soon as practical and in the best form that we can,” Matt Toews, Eavor’s co-founder and chief technology and operating officer, told Canary Media. ​“Exactly how that shakes out, I can’t say yet until it’s done.”

Still, ​“The overall grand plan stays the same,” he added. ​“It’s really about proving the technology, … coming down the learning curve, and going deeper and hotter” to unleash geothermal energy.

Eavor began drilling in Geretsried, which is south of Munich, in July 2023 after winning a grant for 91.6 million euros from the European Union’s Innovation Fund. At full scale, the project is intended to supply 8.2 megawatts of electricity to the grid and 64 MW of district heating to nearby towns.

Demand for the renewable resource is rising globally as countries look to boost supplies of clean, domestic energy, both to meet their soaring electricity needs and to reduce reliance on volatile fossil fuels. Traditionally, geothermal power plants have been confined to places with natural reservoirs of steam and hot water, like near Iceland’s volcanos or California’s thermal springs.

Eavor is one of dozens of companies trying to break those constraints by developing technologies that can access earth’s heat potentially anywhere — though the industry is just starting to deploy those solutions in the real world.

It’s not uncommon to see delays or evolving plans when rolling out new energy technologies.

Emily Pope, a geologist and senior fellow at the Center for Climate and Energy Solutions, said she wasn’t remotely surprised to hear that a first-of-a-kind project like Eavor’s encountered technical hurdles. Pope previously worked on the Iceland Deep Drilling Project, an ongoing research initiative to tap into superhot reservoirs, which hit significant snags after its first well unwittingly struck magma and then the second one collapsed.

“The setbacks [for Eavor] were real, but also understandable and predictable, and something that we see in every industry that is trying to grow,” she said, adding that geothermal developers in general ​“are going to have to learn by doing.”

A giant radiator for always-on, carbon-free power 

Eavor’s approach is akin to building a massive radiator several miles beneath the earth’s surface. Each loop involves drilling two vertical wells and pairs of horizontal, or lateral, wells that stretch out like the tines of a fork. The wells are later connected underground and sealed off. As water circulates within the system, it collects heat from the rocks and brings it to the surface.

The basic concept is tried and true; this is essentially how shallow geothermal networks heat and cool homes and buildings. But Eavor’s system requires drilling far deeper, and in much trickier conditions, in order to provide utility-scale electricity and heating.

In the United States, another next-generation technology — an enhanced geothermal system, or EGS — has been gaining the most traction among developers. The startup Fervo Energy is building what will become the world’s largest EGS project in Utah, using fracking and horizontal drilling techniques to create artificial reservoirs. The first phase of this 500-megawatt project is set to start producing power this fall.

As a technology, enhanced systems are considered more advanced and relatively less costly than closed-loop systems for power generation. The loops are generally less efficient at extracting heat from the earth, since their fluids don’t directly touch rocks, and they can be lengthier and more complex to drill. But EGS has its own trade-offs: The approach carries the risk of inducing earthquakes and straining local water supplies, though experts say both issues can be mitigated.

“Closed-loop just leapfrogs over those challenges” because of its contained design, Pope said, adding that the systems could be a better fit for harnessing heat in dense urban areas and in water-scarce regions. In the U.S., the companies XGS Energy, GreenFire Energy, and Vero Geothermal are also pursuing closed-loop projects in places like California and New Mexico.

“There’s a demand for it, and there’s just a lot of good reasons to try to do it,” Pope said.

Learning lessons the hard way 

Last fall, Eavor released results from two years of activity in Geretsried, which showed how the company reduced drilling times and improved performance despite encountering challenges. In late May, Toews penned a technical update describing in greater detail the key problems Eavor faced in drilling its first loop.

After its first boreholes became unstable, leading to the risk of stuck pipes, Eavor changed the type of drilling-fluid system it used. Broken equipment and slow drilling speeds initially plagued the project, owing in part to the hard rock types and the length of the lateral wells. By tweaking its techniques and adapting equipment, Eavor said it cut its average drilling time by over 70% from the first four lateral well pairs to the last.

The company also developed an ​“active magnetic ranging” system to give it more precision when drilling long wellbores and getting its lateral well pairs to intersect underground. ​“If you look at the wells, the first ones are kind of like wet noodles, and the last ones are gun-barrel straight,” Toews said in an interview.

But one challenge proved harder to address.

Eavor began by using two drilling rigs in parallel to form the ​“motherbores” from which the lateral wells extend out. The company found that poor cement casing on the motherbores allowed fluid and mud to flow freely between the two rigs, which are supposed to be completely sealed off. So the team switched to using one rig at a time — a temporary fix that doubled the time and cost for Eavor’s first loop.

The startup initially planned to drill 12 pairs of lateral wells for that first loop. But it stopped short at six so that it could try again with proper cementing design on the second loop. This could mean bringing on project partners with more experience drilling multilateral wells. Pope noted that well leakage is a common engineering problem in the oil and gas industry — one that drilling teams can generally account for and address.

Today, the system is producing as much power as Eavor expected for a loop of that size: about half a megawatt. For Eavor, that’s proof the technology works as promised, though the firm hasn’t said when it expects to reach full capacity for electricity and district heating.

“Despite all the challenges we had, and by us solving them, it has served its purpose,” Toews said of the flagship project. ​“We’ve proven that we can extract heat with our system, we know what it costs, … and we know exactly how to build and operate these loops at commercial scale.”

Pope said she hoped that Eavor and other companies will continue to be transparent about their experiences, to help other developers avoid similar pitfalls and to manage public expectations.

“I think it’s really important for the industry broadly to understand where companies are in their technological development, so we can have honest conversations about how close we are to achieving a commercial-scale product,” she said.