Despite its potential, traditional geothermal energy production continues to face several challenges. The cost of exploring and drilling for geothermal resources is high. According to the U.S. Department of Energy, drilling and exploration can account for up to 50% of the total cost of a geothermal project. This high upfront cost makes investment in geothermal energy a long-term proposition to which many investors are unwilling to commit.

Additionally ,the permitting process for traditional geothermal projects can be lengthy. In the United States, it can take up to seven years to obtain the necessary permits for a geothermal project. This long permitting time delays the start of energy production and adds to the overall cost of the project.

Another challenge is the limited geographical scope of traditional geothermal energy production. Geothermal resources are often located in specific regions with high geothermal activity, such as Iceland, the Philippines, and specific locations within the western United States. This limited geographical scope restricts the widespread adoption of geothermal energy and restricts its ability to meet the load demands of major US cities, particularly on the East coast.

Gradient Geothermal addresses the challenges by leveraging existing infrastructure from oil and gas production, as well as from hydrogen, helium, and lithium extraction. These industries often extract large quantities of water that are hot enough to generate electricity. By using this existing infrastructure, Gradient Geothermal eliminates the need for expensive exploration and drilling.

Thecompany employs proprietary modular field generation systems to convert theextracted hot water into electricity. These systems are designed to be flexible and scalable, allowing them to be deployed in various locations with existinginfrastructure. This approach significantly reduces the cost and time required to develop geothermal energy projects.

By utilizing existing infrastructure, Gradient Geothermal also expands the geographical reach of geothermal energy. Instead of being limited to regions with high geothermal activity, geothermal energy can now be produced in areas with existing oil, gas, hydrogen, helium, or lithium extraction operations. This broader geographical scope allows geothermal energy to contribute to the electricity grid in more locations.