Fervo Energy shares climbed 28.41 percent on Tuesday, closing at $19.75 each following the announcement of a significant power purchase agreement with Google. The accord centers on the Cape Station project in Utah, through which Fervo will provide 396 megawatts of power to support Google’s data center expansion. The initial phase of the project has progressed toward commercial operations, while development efforts on a second phase are underway, with eight GeoBlocks expected to become operational in 2028.
Google has negotiated an option to expand its power offtake capacity by an additional 600 megawatts, which would bring total contracted capacity to approximately 1 gigawatt by 2030. The overall data center plan remains contingent on multiple considerations, including engineering feasibility assessments, regulatory approvals at state and local levels, and prevailing commercial conditions. This partnership builds on prior collaboration between the companies, including their Project Red initiative in Nevada in 2023, which successfully delivered power to the local grid and Google’s data center operations, followed by a power purchase agreement covering 115 megawatts of geothermal capacity.
Financially, Fervo reported revenues of $113 million during the second quarter of the year, compared to zero in the corresponding quarter of the prior year, driven by strong customer demand and expanding behind-the-meter capabilities. However, the company’s net losses widened significantly to $55.9 million from $11.4 million, attributed to elevated operating losses and non-operating expenses. The company, which completed its stock market debut last May, has attracted considerable institutional interest, particularly given rising energy demand from the artificial intelligence sector. Hedge fund participation expanded to 53 funds holding positions totaling $691 million in holdings during the second quarter.
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