Dig Energy today announced it has raised $5 million in venture financing to bring its patented geothermal-specific drilling technology into pilot installations. The round was co-led by Azolla Ventures, a leading climate investor, and Avila VC, with participation from Conifer Infrastructure Partners, Suffolk Technologies, Mercator Partners, Koa Labs, and preseed investors Baukunst and Drew Scott. Dig has also won additional support from programs including Suffolk Technologies’ BOOST accelerator and the U.S. Department of Energy’s EPIC Prize.
Heating and cooling account for 35% of all energy consumption, largely powered today by fossil fuels. With rising energy prices and increasing stress on the grid, the Dig founding team set out to find a scalable alternative. They focused on geothermal heating and cooling, which taps the earth’s stable temperature a few hundred feet underground to heat and cool buildings through geothermal heat pumps, effectively turning the earth into a giant thermal battery.
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Shallow geothermal is a well-vetted system, and routinely cited as the most energy efficient way to heat and cool buildings, yet adoption has remained stagnant at just 1% in the US. Geothermal boreholes connect seamlessly to heat pumps and can scale up or down to heat and cool buildings of any size or type. Drilling costs are the biggest barrier to widespread adoption. Current geothermal projects rely on oversized drills designed for oil and gas, and these rigs are expensive, overpowered, and limited in where they can go.
To make geothermal cost competitive with fossil fuels and air source heat pumps, without reliance on incentives or policy changes, Dig is addressing these drilling cost barriers directly. The company has developed a compact, purpose-built drill that uses high-pressure fluid drilling instead of traditional, expensive carbide drill bits. The system reduces drilling costs by up to 80%, massively expanding the geothermal heat pump market opportunity.
“The heat beneath our feet is abundant, reliable, and always on,” said Dulcie Madden, Dig Energy CEO. “Our purpose-built, reliable, robust drill finally unlocks the most efficient on-site source of heating and cooling for buildings. By making geothermal heating and cooling simple, scalable, and cost competitive with less efficient approaches such as delivered fuels and air source heat pumps, we can deliver true energy independence to buildings everywhere.”
“Dig holds potential to finally make geothermal heat pumps – by far the most efficient way to heat and cool buildings – cost effective to install. They’ve developed a new drilling method that imparts minimal added costs to the overall HVAC system,” said Johanna Wolfson, co-founder and General Partner at Azolla Ventures. “Next, pilot installations will show that Dig’s technology is the missing link to unlock geothermal as a mainstream solution for heating and cooling.”
“Dig’s deceptively simple drill leverages an existing supply chain and proven materials to tackle drilling cost – the single biggest barrier to geothermal adoption,” said Patricia Wexler, founder and General Partner of Avila VC. “They’ve built a proprietary solution from the ground up that is ready to scale at exactly the right time in the energy market.”
“Dig Energy aligns perfectly with my focus on every family having the ability to live in a safe, happy, healthy, and affordable home,” said Drew Scott, co-founder of Scott Brothers Global. “Heating and cooling costs are wildly unpredictable today. Dig will give homeowners and business owners reliable comfort and greater control over their energy future.”
With the new funding, Dig will advance from field testing into its first pilot installations, while raising awareness of geothermal across all potential customers. The company’s mission is to provide a global solution for developers, building owners, utilities, and municipalities with a reliable, cost-competitive path to unlock abundant, low-cost, reliable energy while decarbonizing heating and cooling at scale.
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