Cindy Taff was standing on flat ground in Starr County, Texas, when she felt an earthquake in early 2022. “The ground was literally vibrating,” she told TechCrunch. “That was an 'aha moment' for me.”
Her startup, Sage Geosystems, has been testing equipment it uses to extract heat from deep underground. The team has pumped water into wells and is now releasing it. The result is a gush of hot, clean water that could replace natural gas as a reliable source of power around the world, rather than oil.
People have long been harnessing heat from deep within the earth, and so has Sage Geosystems. But the company also proposes using thousands of feet of wells as batteries, storing pressurized water to generate electricity later. The company has been testing the idea in Starr County for more than a year. On Tuesday, Sage Geosystems announced it is building its first commercial-scale facility outside San Antonio.
The new project will occupy most of a 10-acre site adjacent to a coal-fired power plant owned by San Miguel Electric Cooperative Inc. Sage plans to drill wells there and store electricity from small solar panels that will be used to continuously power a small data center, Taff said, calling the facility a “model house for larger data centers.”
The system, which the company calls a geopressured geothermal system, is rated to produce 3 megawatts of electricity, enough for more than 600 homes, at about 10 cents per kilowatt-hour.
Taff said Sage plans to begin drilling in mid-September and have the plant operational in December.
Taff and his colleagues came to Sage after long careers in the oil and gas industry: Taff, the company's CEO, spent decades at Shell, eventually becoming vice president of land drilling, while others had similarly long careers at Shell, Exxon and other companies.
“We wanted to get into renewable energy,” Taff says, but the shift wasn't obvious. Renewables is dominated by wind and solar, which doesn't overlap much with their skill set, which is understanding what's deep in the earth and drilling to get to it. “But when we thought about geology — energy storage and geothermal — it was a perfect fit.”
Like other geothermal startups, Sage Geosystems started with a plan to lower electricity bills. One of the big costs geothermal power producers face is injecting water into the ground. Sure, they could let the water drip through pipes and soak into the surrounding rock, but that would take a lot of time. Instead, they inject the water under pressure, which requires energy.
When the company began work on the test well, Taff and his colleagues realized they could capture some of the energy by passing pressurized water through a turbine.
“It basically inflates the cracks and stores the water under pressure,” Taff says, “and then when it needs to, it basically opens a valve on the surface, and the cracks try to close, releasing the water.”
The similarities between geothermal and oil and gas start to fade. To frack an oil and gas well, companies need to inject water and a grist (called a proppant) to crack the rock and keep it open so the fossil fuel can flow back into the well. Much of the water used to drill is lost, and often brine comes out along with the oil and gas. So not only does fracking require a lot of water, it also produces a lot of wastewater.
Sage, meanwhile, aims to minimize water loss. Most of the loss happens at the surface, when water evaporates from the reservoir. Some remains when the water is pumped from the reservoir to the well. Over time, Taff says, the rocks around the well become saturated, forming a barrier that slows the loss. When the test well first opened, about 2% was lost to leakage and evaporation per injection-withdrawal cycle. After a little over a month, that loss was down to about 1% per cycle.
Once Sage proves its technology with the first well, the company could add 10 more wells, bringing the site's capacity up to 50MW, Taff said. SMECI, the electric cooperative that owns the land, plans to shut down the site's coal-fired power plant in 2026 and replace it with solar panels. To provide a steady supply of power like a coal-fired plant would provide, the company is considering pairing those panels with some form of energy storage. Overall, the company expects to be able to recover at least 70% of the electricity it uses to inject the water.
“They want a front-row seat to what we're doing,” Taff said. “This is energy storage, not geothermal, but this will allow us to prove out about 80 percent of our technology.”
Beyond SMECI, Sage is also working with major technology companies to develop geothermal energy storage projects for data centers. Grid-scale batteries have garnered a lot of attention, but are too expensive to run solar-powered data centers overnight.
“We're not trying to compete with lithium-ion batteries on two- to three-hour duration because we'd lose on cost, but if we have to stack lithium-ion batteries, we can win on cost,” Taff said.