Geothermal is too expensive, but Dig Energy’s impossibly small drill rig might fix that | TechCrunch

On a farm near Manchester, NH, I was recently sent into dirty water, not the kind of thing most startups would show journalists. but Dig into energymud is a feature of its compact rig, not a mistake.

The startup has been invisible for the past five years, and it has developed a water jet drill to make heating and cooling of geothermal heat so cheap that it will replace fossil fuel boilers and stoves. The rig is crucial and promises to cut drilling costs by up to 80%.

Dig Energy received $5 million in seed funding Tuesday, TechCrunch exclusively learned. The round was led by Azolla Ventures and Avila VC and participated by Baukunst, Conifer Infrastructure Partners, KOA Labs, Mercator Partners, Drew Scott and Suffolk Technologies.

Heating and cooling account for about one-third of all energy use in the U.S., and in data centers, that number can be as high as 40%. Geothermal can reduce HVAC energy use while also saving grid operators $4 billion each year. To help stabilize its squeaky grid, the United States needs to drill 6 million feet of geothermal drilling per day until 2050, according to Go to Oak Ridge National Laboratory.

But geothermal prices are not cheap, at least not at first.

“In the U.S., geothermal has always been 1% of building installations,” Dig co-founder and CEO Dulcie Madden told TechCrunch. This is true despite the low operating costs of the technology. “It’s really just because upfront costs are so, so expensive.”

Geothermal comes in two main flavors: the enhanced geothermal drill bit goes thousands or tens of thousands of feet down. The company likes it Fervo and Quaise The depth of the drilling is digging very hot temperatures (usually hundreds of degrees) to generate electricity. Another shallow geothermal heat is the focus of excavation, usually limited to hundreds of feet. At these depths, the ground maintains consistent temperatures year-round, perfect for heating and cooling residential and commercial buildings.

In shallow geothermal heat, the pipe carries water underground, where it transfers heat to the earth. In the summer it pours out excess heat and refrigerates water back to the ground to cool the building. In winter, it absorbs heat and heats.

When calling underground pipes, installing ground loops means 30% Among the total cost of ground source heat pumps, this is one of the main reasons why this technology is more expensive than traditional heating and air conditioning systems. The cost of solving these is high on the DIG’s list.

“When we get started, we’re like, can we build a low-cost drill?” Madden said.

Madden and her co-founder husband Thomas Lipoma began exploring the space five years ago, after their previous startups, Rest equipment. They soon stumbled upon old research, describing how water jets were used instead of traditional cutting drills to seep into the earth.

However, despite extensive research on the technology, prime time is not ready. “Many drilling techniques drip from oil and gas,” Madden said. Translation: It tends to be big, expensive, and overwhelmed in deep-dig geothermal heat.

Dig spent years perfecting the design of its rig, drilling test holes near its office in New Hampshire. They have drilled through soil, gravel, clay, sand and a range of different rocks, including sandstone, limestone, granite, slate and shale. The team showed me some test blocks of very dense rocks with neat holes exploding in the middle.

Today’s geothermal rigs can do the same thing, but they are huge by comparison. The most commonly used version sits on the back of a large truck. For easy-to-access sites, they work well. But they couldn’t squeeze into the side of people’s backyards, and in crowded commercial building sites, they occupied valuable free space.

While Dig’s prototype isn’t ready for commercial use, I’ve seen much smaller than the widely used geothermal rigs. Its drilling holes are also straighter than holes made by traditional drilling mechanisms. These two details together mean that the holes that are dug can be placed closer, which is a gift from any developer.

Dig’s rig will grow slightly when it’s ready to use the first commercial pilot (this kind of sub-round helps with completion), but it doesn’t require the large twin-axle trucks that currently dominate the industry.

The company plans to sell the equipment to drillers, offering another option for existing projects and potentially opening up the avenues to new ones. Other companies are exploring the technology.

“We don’t have to ask people to buy $2 million rigs, which should be the lower cost of getting into the business,” Madden said. “Geothermal should be in 100% of buildings. That’s 1% of buildings. So how do we close 99% of buildings?” she added. “It’s actually an untapped market.”