Last month, Fervo went public. Other geothermal startups are crowding the market, each offering a slightly different twist on the technology. The growing industry has a symbiotic relationship with hyperscalers like Google that are willing to spend big. These are all signs that 2026 could be the industry’s break-out moment.
Spencer Jackson, a former SpaceX engineer turned entrepreneur, agrees that geothermal is hitting an inflection point — but notes that most of the focus and resources in the industry have been going towards subsurface work, such as drilling and exploration.
“But there’s a turbine shortage,” Jackson told Latitude Media, noting that about half the cost of a geothermal power plant is the surface hardware that converts heat to electricity, and that if geothermal keeps growing at its current rate, there isn’t going to be enough of that equipment readily available.
Based on this premise, Jackson founded Critical Energy, a startup aiming to streamline and simplify the construction of power plants for geothermal. The company, which was founded in 2024, announced today that it has raised $22 million in seed funding, across rounds led by Susa Ventures and Upfront Ventures, with participation from MaC Venture Capital and Susquehanna Sustainable Investments, among others. The amount includes a $3 million venture debt facility from Silicon Valley Bank.
The idea is to build power plants for the geothermal industry in five-megawatt modules the size of four 40-foot shipping containers. “We build fully-functional power plants in chunks in our facility, and we can ship them to any customer on Earth in trunkable format, and then we assemble the chunks on site like giant Lego bricks,” Jackson said.
This approach would theoretically give geothermal developers the ability to buy or lease the equipment and then install a power plant in a matter of weeks, a significantly shorter timeline than what the industry requires today. It also gives them flexibility in terms of size.
“Now… if you want to order a 50-MW power plant, you order it three years in advance, and by the time it arrives, you drilled a lot of your wells and you flow-tested them,” Jackson said, noting that it’s hard for most developers to know exactly the power output of its wells before extensive testing has been done — which means by the time the equipment arrives, it won’t be operating at peak efficiency.
Space X-style ambitions
So far, Critical Energy has built a 50-kilowatt demonstrator at its facility in Los Angeles, and is testing it with an artificial heat source. By the summer of 2027, it hopes to have a 2.5MW power plant installed and operating at the site of an undisclosed geothermal company, and to start selling units by 2028.
It’s an ambitious pitch, with an ambitious timeline, especially for a new company with a CEO and founder with no prior geothermal experience, a 10-person team, and seven open positions.
But, Jackson says, part of his experience as an engineer at SpaceX involved building rocket engines, and those are not that much different from geothermal power plants. “A Raptor rocket engine is turbines, compressors, and heat exchangers,” he said. “A power plant is turbines, compressors, and heat exchangers.”
Plus, we’re at a moment when geothermal is embracing advanced technologies. Enhanced geothermal company Quaise, for instance, is digging super-deep wells with millimeter-wave drills to access more energy-dense water. And Zanskar is relying on fairly traditional technologies, but is using AI to determine where to drill, and ideally de-risk the exploration process. Combined with hyperscalers’ willingness to spend big to develop clean baseload power, Spencer is not alone in thinking the geothermal sector is on the cusp of very quick growth.
Historically geothermal has been dominated by a few large projects, which allows for slower construction times. But that’s starting to change, Jackson said: “We’re hitting an inflection point where more and more products are going to start scaling to where they want to do the same thing over and over again, so we have a chance to actually make a standardized product that you can build repeatedly.”
He recalls the process of how the fossil fuel industry scaled in the early 2000s gas boom: Companies started shifting to modular, pre-fabricated equipment, “and that completely changed their cost dynamics,” Jackson said “It allowed them to build equipment in a factory or a facility, ship it out of the field in rural Texas, rather than doing all that work on site.”
Today, though, most geothermal turbomachinery for power conversion is made outside the United States. As noted in a recent RMI research note, this creates a dynamic that “could put the industry in a bind.” Currently, the primary geothermal turbine manufacturers are Turboden, which is based in Europe and owned by Japan’s Mitsubishi Heavy Industries, and Ormat, which has its main manufacturing facilities in Israel and Turkey. Both have been in the space for years, and Jackson says geothermal players are “frustrated” with how long things can take.
Critical Energy, if it can scale to anywhere close to their capacity, would provide a U.S.-based alternative — one that, as Jackson put it, is already talking to its potential customers “much more aggressively.”
