Last year, Fervo Energy sold about $138,000 worth of electricity. In May, the market valued the company at more than $10 billion. The thing that is supposed to close that gap is a power plant being drilled into hot rock in Beaver County, and it has not yet sent a single watt to the grid.
On June 22, Fervo will tell the public for the first time how that plant is coming along. The company reports first-quarter results before the market opens on Monday, its first earnings call since it went public at $27 a share on the Nasdaq in May. The Houston company will run the call and choose the language. The asset under discussion sits roughly 200 miles south of Salt Lake City, near Milford, a town of about 1,400 people that has spent the last decade becoming an unlikely center of American energy research.
The plant is called Cape Station, about 12 miles northeast of Milford. Fervo's first phase is 100 megawatts, with another 400 to follow. The company's SEC filing puts 500 megawatts under construction at the site, with first power expected late this year and the full 100 megawatts by early 2027. Fervo has pointed to October for the first electrons. Phase II is targeted for 2028.
Enhanced geothermal is geothermal for places without a natural hot spring. Conventional plants need an existing reservoir. Fervo makes its own. It drills sideways into hot rock, fractures the rock with pressurized water, and circulates fluid through the cracks to carry heat to the surface. The methods are not exotic. They are the horizontal drilling and hydraulic fracturing that opened the American shale fields, and turned to chase temperature instead of gas. Fervo's chief executive, Tim Latimer, started his career as a drilling engineer in oil and gas before he and his co-founder set out to find heat. The company calls Cape Station the world's largest next-generation geothermal development. When Phase I energizes, Fervo says it will be the first enhanced geothermal plant to reach commercial scale on the grid.
Why Milford matters is a detail the company tends to mention and move past. Fervo leased land directly adjacent to Utah FORGE, a federally funded research site run with the University of Utah, where the Department of Energy has spent more than $300 million learning how to fracture hot rock in exactly this geology. One operation sits about a mile from the other. At the Cape Station groundbreaking, Latimer credited FORGE's research and data with helping Fervo move faster. A public laboratory de-risked a private power plant next door.
The case for the valuation is not the revenue. It is the backlog. Fervo has signed 658 megawatts of binding power purchase agreements worth about $7.2 billion, with anchor buyers including Southern California Edison and Shell. These are contracts, not intentions. The demand behind them is real and loud: utilities and corporations want round-the-clock power that does not emit carbon and does not depend on weather, and the data center buildout for artificial intelligence has made that demand acute.
The marquee name attached to Fervo is Google, and here the filing demands a closer read. The headline Google number is a 3-gigawatt framework agreement signed in March. It is not a contracted backlog. The S-1 describes it as non-binding, an arrangement that gives Google priority access to Fervo's pipeline without obligating Google to buy anything. The contracts that count are the ones with the utilities.
The case against is the part that has not happened yet. Fervo carries negative shareholder equity and almost no revenue, and the entire $10 billion rests on a plant in Beaver County coming online on time and at the cost the company has promised. Fervo's pitch is a cost curve: power that today runs around $7,000 per kilowatt, with a target of $3,000 as drilling gets faster at scale. Drilling that gets cheaper with every well is the thesis. Drilling that slips is the risk.
There is a Utah question inside all of this that the ribbon-cuttings tend not to answer. Roughly half the backlog, about 320 megawatts, is committed to Southern California Edison on 15-year terms. That power is bound for California. Milford's mayor has said as much publicly, noting that the electricity generated by energy projects in the county flows out of state while the town that hosts the work sees little of it. A plant drilled into Utah rock, built with Utah permits, on land next to a Utah research site, may send most of its first power to Los Angeles.
The investor list reads like a map of who is betting on the outcome. Bill Gates-backed Breakthrough Energy is in. So are the oil and gas players: Devon Energy and Liberty Energy, the fracking firm founded by Chris Wright, now the U.S. energy secretary. Geothermal is one of the few clean-energy categories the current administration has embraced. The same crews and supply chains that built the oil economy are now pointed at the rock under southern Utah, with federal money on both sides of the fence, public at FORGE and private at Cape Station.
Wall Street opened coverage in a cluster, with targets ranging from $40 to $51. Piper Sandler set the top mark, Overweight at $51. Guggenheim came in at $48, then a tight band at $47 from JPMorgan, Barclays, Baird, and Bernstein, RBC at $46, and William Blair at $43. The skeptics sit at the bottom: Jefferies at Hold, citing valuation, and Bank of America at neutral, $40. Worth noting, most of the bullish initiations came from banks that helped underwrite the IPO. The disagreement is not about whether the technology works. It is about what it is worth before it has run a single commercial quarter.
Two days before Fervo set its earnings date, it named Sarah Jewett, long its strategy chief, as chief operating officer, citing an accelerating build-out. A new operating chief installed days before the first public look at operations is either routine or a signal.
On the call, the things that move the number are narrow and knowable. The construction cost of Phase I against the cost curve. The drilling pace. The Phase II timeline toward 2028. And any new contract, especially one that keeps Utah power in Utah.
First power is a matter of months. The earnings call on June 22 is the last full accounting before the moment Cape Station stops being a forecast and becomes a fact, or doesn't.
