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Enhanced Geothermal: Don’t Believe the Hype

Enhanced geothermal is a hot technology in 2026 and the recent initial public offering (IPO) of enhanced geothermal start-up Fervo is a big reason why. The IPO drove a lot of media attention and hype for the technology with headlines saying, “Forget SpaceX. This might be the hottest IPO of the year.” Along with the IPO, we learned this technology has bi-partisan political support in U.S. politics with AOC leading the charge. The Wall Street Journal gave Rahm Emanuel an op-ed to lecture Democrats on energy policy in which his first recommended technology to invest in is geothermal. What is going on here?
Enhanced geothermal is an unproven technology which even if it achieves its most ambitious goals (which is unlikely) it will still be more expensive than the proven technologies of wind, water, solar and storage which are currently dominating global growth in power production.
So while one would expect any person or organization truly interested in phasing out fossil fuels to be pushing these winning technologies as they are THE SOLUTION to our climate problems, the Fervo IPO was supported by a big push for the technology by many of the major environmental non-profits. While world dominating solar and storage are not supported by the Trump administration, enhanced geothermal has strong support.

What is it about this technology that has united all of the powerful voices in the energy space in a way that no other technology has done? Seems like something worth looking into. So let’s do that

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Gluttons For Punishment: Oil Industry Doubles Down Against Reality

The world is facing a multi-year oil glut where the oil producers will be pumping more oil out of the ground than the world is using. This will keep oil prices at low levels – likely well below the level that most US shale oil producers can make a profit. But the U.S. shale oil and gas industry has rarely been profitable so that is nothing new. We know the oil industry is about boom and bust cycles so a situation of oversupply is expected now and then. However, it appears this time is actually different. Let’s do some math.

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In Memphis, AI’s environmental impact is invisible, until you turn on the camera

In Memphis, AI’s environmental impact is invisible, until you turn on the camera
“Breathe easy,” the mailer promised. But as we approached Elon Musk’s new xAI data center in Memphis, we were hit with noxious odors, and gas turbines roared like jet engines. The truth about AI’s environmental cost was hidden — until you looked through the right lens.

Noise, fumes, and disinformation

This spring, reports surfaced saying xAI had installed 35 gas turbines (not the 15 it had announced) near the Boxtown neighborhood of Memphis, an area that has a history of being exposed to industrial pollution. And it had installed them without permits or environmental impact analysis under the guise of being “temporary.” xAI claimed that once emissions controls were installed, it would be “the lowest-emitting facility” in the country.

LNG tanker loading in Louisiana

LNG: The India Question

The global LNG industry has an economics problem. The main use for LNG (liquefied natural gas) is to burn it to generate electricity. However, there are lots of ways to make electricity these days and importing LNG to then burn it to power gas turbines is currently one of the most expensive. And while we know the industry doesn’t care about it, LNG is also one of the dirtiest fuels from an emissions standpoint. It is a climate killer.

So, on the surface LNG doesn’t have a lot going for it if you aren’t an oil and gas executive. Which is why efforts to tout the initial public offering of a leading LNG exporter in the U.S. flopped badly this year as reality creeped in. It’s also why we haven’t heard about any new LNG facilities being funded and moving forward in the U.S. despite the Trump admin handing out LNG export permits like candy. As I’ve been saying for a while, there is a real LNG pause and it is based on economics.

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The Cleanup Bill for the Fracking Boom is Already Here

In 2020 a paper in the Journal of Petroleum Technology acknowledged this fact stating: “… shale producers are now advised to not use conventional wells as a guide, or else run the risk of overstating and overvaluing unconventional assets.”

“Overstating and overvaluing unconventional assets” is another way to say reserves fraud.

Shale wells decline so fast that no one is going to want to own them at year 30 as then they would be stuck with very low oil production and high clean up costs which the profits from the oil production won’t come close to covering. The industry’s failure to acknowledge this is the basis of much of the fraud I have written about.

So when the oil companies run out of new acreage to drill to “keep running,” they have no where else to run to keep the shale boom alive.

So instead they will stop and walk away when the profits are gone. We are now getting proof that the industry is starting to walk away from their cleanup liabilities for shale wells that are not even 20 years old.

“Fascinating deep dive into the economics of Enhanced Geothermal from the straight-shooting Justin Mikulka. As he notes, this technology—drilling a pair of holes deep into the earth, pumping water down one so it will pass through hot rocks, retrieving the warm water from the other, and using the heat to turn a turbine on the surface—has gotten a ton of hype, and lots of expensive support from the federal government, above all I think because it is congenial to Big Oil (they know how to drill stuff, after all). But will it produce affordable electricity? Mikulka has well-reasoned doubts”.

The Crucial Years, Bill McKibben

The oil and gas industry “loves crises from an economic standpoint, but also to force policy changes,” said Justin Mikulka, an energy industry analyst and communications director at the environmental watchdog group, Oilfield Witness. The global economics of the LNG market do not support investing in more U.S. gas exports, “so this is an emergency situation for them.” Desmog

“The Permian is a methane disaster,” Mikulka said.

Justin Mikulka from Oilfield Witness explains that for decades nothing has been done to avoid gas venting because, in many cases, the potential revenues from capturing, transporting and processing the gas don’t justify the capital expense required to build this infrastructure. “The industry in the US and Canada has made it very clear that they do not care about climate or the environment if it cuts into profits.”

To unpack these critical questions, we’ve invited Justin Mikulka to explore what he calls the “LNG Mirage.” He’ll walk us through hard-hitting facts and trends that investors are currently overlooking. At events like CERAWeek and Gastech, the fossil fuel industry often seems to talk only to itself — echoing reassurances while ignoring warning signs. But winter is coming.

From Bill McKibben: “To understand why the White House is quite so frantic, reflect that their buddies in the oil patch know their only possible source of growth is exporting liquefied natural gas to the rest of the world, and as Justin Mikulka writes that’s looking increasingly problematic. The whole piece is well worth reading”

My articles and op-eds have also appeared in Scientific American, In These Times, The Intercept, DeSmog, Drilled News, EcoWatch, Real Clear Markets, Truthout, Energy Post (Europe) and Nation of Change.

Contact: mikulka@gmail.com