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

Summary

On a farm near Manchester, New Hampshire, I was recently treated to a gusher of dirty water, not exactly the sort of thing that most startups will show a reporter. But for Dig Energy, the mud is a feature, not a bug, of its compact drilling rig. The startup, which has been operating in stealth for the last five years, developed the water-jet drilling rig in an effort to make geothermal heating and cooling so inexpensive that it will displace fossil fuel boilers and furnaces. The rig is central to that, promising to slash drilling costs by up to 80%. On Tuesday, Dig Energy emerged with $5 million in seed funding, TechCrunch has exclusively learned. The round was led by Azolla Ventures and Avila VC with participation from Baukunst, Conifer Infrastructure Partners, Koa Labs, Mercator Partners, Drew Scott, and Suffolk Technologies. From left: Vice President of Engineering Dan Jepeal, CEO Dulcie Madden, and CTO Thomas LipomaImage Credits:Dig Energy Heating and cooling represent about a third of all energy use in the U.S., and in data centers, the figure can be as high as 40%. Geothermal can slash HVAC energy use while also saving grid operators up to $4 billion annually. To help stabilize its creaking electrical grid, the U.S. needs to drill 6 million feet of geothermal borehole daily through 2050, according to the Oak Ridge National Laboratory. But geothermal doesn’t come cheap, at least not at first. “In the United States, geothermal has been 1% of building installations for decades,” Dig co-founder and CEO Dulcie Madden told TechCrunch. That’s despite the technology’s low operating costs. “It’s really just because upfront cost is so, so, so expensive.” There are two main flavors of geothermal: Enhanced geothermal drills down thousands or tens of thousands of feet. Companies like Fervo and Quaise that are drilling the deep are tapping very hot temperatures — usually in the hundreds of degrees — to generate electricity. The other, shallow geothermal, which is what Dig i...