EnLink Geoenergy raises $30M for geothermal heat pump installations

Houston, Texas-based EnLink Geoenergy Services is tapping into investors’ growing appetite for geothermal energy to ramp up its development of geothermal heat pump (GHP) installations for residential, commercial and institutional settings.

EnLink, which was founded in 1995, has developed over 75 projects in 14 states — the majority of which, 69 percent, are in schools. GHP systems, which have been in use for over half a century, have been installed in more than 750,000 buildings in the U.S.

The company claims its technology helps reduce the costs of installation for commercial-scale GHP projects and improves the quality of underground vertical loop field systems — what it calls Earth Heat Exchangers (EHX) — which transfer heat in the air from the building to the ground during the summer and vice-versa during the winter.

EnLink’s highly adaptable drill can be fitted to any EHX design, and its loop insertion and grouting systems stabilize soil conditions to secure its installation. CEO Ray List claims these systems help significantly reduce the installed cost of EHXs and bolsters their performance.

Heat pumps, the other components to GHP installations, control air movement to the EHX and can be used in multiples to minimize heating/cooling losses. List hopes these installations will appeal to commercial and institutional users in states like California, which have laws mandating that buildings reduce their carbon footprint. The efficiency boost these installations impart to buildings’ heating, ventilation, air conditioning and cooling (HVAC) systems could help them cut costs.

Because of the savings it incurs, EnLink says its system would pay for itself in 4 years. With energy prices on the rise, the company’s technology could provide a tried, low-cost way for businesses to reduce their bills over the long term — and an appealing opportunity for investors.

Last year, private equity firms invested over $400 million in geothermal energy. According to New Energy Finance, a total of $3 billion was invested in the sector — a 183 percent surge from 2006. About half of these new investments were made in the American market, in companies like Ormat and US Geothermal, which have a number of geothermal energy generation projects in the U.S.

According to VentureWire, EnLink raised almost $30 million in private equity funding from Craton Equity Partners and Medley Partners LP. The funds will be used to reorient the company’s business model around services rather than products.