Zanskar Raises $115 Million to Propel Geothermal Discoveries

One of the buzziest climate tech companies of the past year is proving that a mature, hitherto moribund technology — conventional geothermal — still has untapped potential. After a breakthrough year of major discoveries, Zanskar has raised a $115 million Series C round to propel what’s set to be an investment-heavy 2026, as the startup plans to break ground on multiple geothermal power plants in the Western U.S.

“With this funding, we have a six power plant execution plan ahead of us in the next three, four years,” Diego D’Sola, Zanskar’s head of finance, told me. This, he estimates, will generate over $100 million of revenue by the end of the decade, and “unlock a multi-gigawatt pipeline behind that.”

The size of the round puts a number to climate world’s enthusiasm for Zanskar. In Heatmap’s Insider’s Survey, experts identified Zanskar as one of the most promising climate tech startups in operation today.

Zanskar relies on its suite of artificial intelligence tools to locate previously overlooked conventional geothermal resources — that is, naturally occurring reservoirs of hot water and steam. Trained on a combination of exclusive subsurface datasets, modern satellite and remote sensing imagery, and fresh inputs from Zanksar’s own field team, the company’s AI models can pinpoint the most promising sites for exploration and even guide exactly what angle and direction to drill a well from.

Early last year, Zanskar announced that it had successfully revitalized an underperforming geothermal power plant in New Mexico by drilling a new pumped well nearby, which has since become the most productive well of this type in the U.S. That was followed by the identification of a large geothermal resource in northern Nevada, where exploratory wells had been drilled for decades but no development had ever occurred. Just last month, the company revealed a major discovery in western Nevada — a so-called “blind” geothermal system with no visible surface activity such as geysers or hot springs, and no history of exploratory drilling.

“This is a site nobody had ever had on the radar, no prior exploration,” Carl Hoiland, Zanskar’s CEO, told me of this latest discovery, dubbed “Big Blind.” He described it as a tipping point for the industry, which had investors saying, “Okay, this is starting to look more like a trend than just an anomaly.”

Spring Lane Capital led Zanskar’s latest round, which also included Obvious Ventures, Union Square Ventures, and Lowercarbon Capital, among others. Spring Lane aims to fill the oft-bemoaned “missing middle” of climate finance — the stage at which a startup has matured beyond early-stage venture backing but is still considered too risky for more traditional infrastructure investors.

Zanskar now finds itself squarely in that position, needing to finance not just the drills, turbines, and generators for its geothermal plants, but also the requisite permitting and grid interconnection costs. D’Sola told me that he expects the company to close its first project financing this quarter, explaining that its ambitious plans require “north of $600 million in total capital expenditures, the vast majority of which will come from non-dilutive sources or project level financing.”

Unsurprisingly, the company anticipates that data centers will be some of its first customers, with hyperscalers likely working through utilities to secure the clean energy attributes of Zanskar’s grid-connected power. And while the West Coast isn’t the primary locus of today’s data center buildout, Hoiland thinks Zanskar’s clean, firm, low-cost power will help draw the industry toward geothermally rich states such as Utah and Nevada, where it’s focused.

“We see a scenario where the western U.S. is going to have some of the cheapest carbon-free energy, maybe anywhere in the world, but certainly in the United States.” Hoiland told me.

Just how cheap are we talking? Using the levelized cost of energy — which averages the lifetime cost of building and operating a power plant per unit of electricity generated — Zanskar plans to deliver electricity under $45 per megawatt-hour by the end of this decade. For context, the Biden administration set that same cost target for next-generation geothermal systems such as those being pursued by startups like Fervo Energy and Eavor — but projected it wouldn’t be reached 2035.

At this price point, conventional geothermal would be cheaper than natural gas, too. The LCOE for a new combined-cycle natural gas plant in the U.S. typically ranges from $48 to $107 per megawatt-hour.

That opens up a world of possibilities, Hoiland said, with the startup’s’s most optimistic estimates showing that conventional geothermal could potentially supply all future increases in electricity demand. “But really what we’re trying to meet is that firm, carbon-free baseload requirement, which by some estimates needs to be 10% to 30% of the total mix,” Hoiland said. “We have high confidence the resource can meet all of that.”