$$ORA (-1,27 %) It performed well for a long time and even doubled in value at one point: unfortunately, I missed the exit. But oh well. It no longer contributes to growth or diversification in my portfolio, and the news isn’t positive either, so ciao, cocoa

Dear Community,

In my recent posts, we’ve tried to uncover the layers of modern energy infrastructure:

• The Nuclear Renaissance: We’ve seen how the decommissioning of old reactors and the disposal of radioactive waste have become a lucrative business for specialists, while at the same time new reactors are making a comeback as CO2-free power plants.

• Industrial Heat: Next, we delved deeper into the factory floors. Heat is the “currency” of industry. Those who efficiently utilize waste heat or decarbonize process heat secure their competitiveness for the future.

• Power Highways: We also analyzed the hardware behind the AI boom. Without high-performance grids and high-voltage cables, even the cleanest electricity remains stuck where it’s produced—far away from the power-hungry data centers.

But what if the solution to all these problems were right under our feet? What if we could combine the drilling expertise of waste management specialists, process heat for industry, and a constant energy supply for AI networks all in one place?

Welcome to the next chapter: Deep Geothermal 2.0. While we’ve only scratched the surface so far, by 2026 this technology will allow us to harness the earth’s crust’s enormous heat on a much broader scale. It’s the perfect symbiosis of the oil industry’s precision and the promise of an eternal, baseload-capable energy source.

1. The “Pure Play” Operators & Developers

Ormat Technologies ($ORA (-1,27 %))

• Profile: The only vertically integrated geothermal company listed on the U.S. stock exchange. Ormat designs, builds, and operates power plants worldwide.

• Core Business: A vertically integrated provider of clean energy—the company designs, manufactures, builds, sells, owns, and operates primarily geothermal and recovered-energy power plants based on its proprietary Ormat Energy Converter.

• Revenue Model: Revenue comes from plant construction and sales, the sale of OEM equipment, long-term power purchase agreements (PPAs), operation and maintenance, and the ownership of generation facilities; in addition, Ormat is expanding its business model to include energy storage and solar-hybrid solutions.

• Strategy: Ormat operates a global portfolio and focuses on organic growth, targeted acquisitions, and technical optimization to expand scalable, reliable baseload and storage solutions in the growing renewable energy market.

• Growth Factor: Ormat is benefiting significantly from the rising demand for “clean firm power” from tech giants and has the most stable cash flows in the sector.

• Opportunities: Recurring revenue, technological advantages, and diversification. Recent project closures and acquisitions, as well as streamlined permitting processes, can accelerate growth and strengthen the company’s market position.

• Risks: Geothermal and storage projects are capital- and development-intensive and are subject to drilling, resource, and permitting risks. Expiring or unfavorable PPAs, competitive and technological uncertainties, and dependence on project financing and supply chains could weigh on earnings.

Constellation Energy ($CEG (+0,31 %))

• Profile: Primarily a nuclear giant, but following the $26.6 billion acquisition of Calpine (completed in January 2026), it now has additional exposure to geothermal energy capable of providing baseload power in the U.S.

• Core Business (Generation & Marketing): Constellation operates a diversified generation portfolio focused on a large, reliable nuclear fleet, supplemented by renewable and thermal plants. The company produces and sells predictable, low-emission energy to wholesale markets and utilities.

• Customer Solutions: Through its retail and service units, Constellation provides electricity and natural gas contracts, as well as energy management, demand response, and sustainability solutions for commercial, public sector, and residential customers.

• Growth & Strategy: Growth is driven by the expansion of clean capacity (a combination of nuclear and geothermal power for data centers), technological innovations (decarbonization applications), and strategic acquisitions to strengthen market presence in key regions.

• Growth Factor: They offer data centers a comprehensive, CO2-free package (“24/7 Clean Power”).

• Opportunities: Benefits from a large, low-carbon portfolio and steady revenues from nuclear power operations; the expansion into additional gas and geothermal assets enhances diversification and supports growth driven by rising electricity demand (AI).

• Risks: Regulatory reviews and approval risks associated with major acquisitions, operational risks and power plant downtime, as well as market and fuel price volatility; furthermore, integration costs and debt can create pressure.

2. The “Shovel Sellers” (Drilling & Sensor Technology)

Baker Hughes ($BKR (+0,99 %))

• Profile: One of the world’s largest oilfield service providers. Baker Hughes supplies technologies, equipment, and field services for the exploration, drilling, production, and processing of crude oil and natural gas, as well as gas turbines and compressors—supplemented by a global service network.

• Business Model: Sales and rental of equipment, long-term service and maintenance contracts, spare parts, and after-sales services are combined with project-based engineering and installation services.

• Differentiation: Market leader in high-temperature drill bits and the AutoTrak system (rotary steerable, https://www.youtube.com/watch?v=bVTROMVLjOU). digital monitoring, performance contracts, and integrated solutions combine hardware with software to reduce operational efficiency and lifecycle costs.

• Growth Factor: Since EGS drilling is technically more challenging than oil drilling, Baker Hughes can command higher margins in this area.

• Future Focus: Expansion of solutions for decarbonization, hydrogen, CO₂ management, and renewable energy integration complements the traditional portfolio.

• Opportunities: Benefits from a broadly diversified product base, strong aftermarket revenues, technological innovation, and a global presence.

• Risks: High dependence on economic conditions and raw materials; regulatory pressure, intense competition, and geopolitical exposure.

Helmerich & Payne ($HP (+2,74 %))

• PProfile: A leading global provider of drilling rigs (approx. 25–30% market share in the U.S.). Expanded massively on a global scale through the acquisition of KCA Deutag (2025).

• Technology: H&P uses its AutoSlide software (https://www.youtube.com/watch?v=WyBDMAYijdM&t=83s),to automate directional drilling on its state-of-the-art FlexRigs. This ensures precise, smooth boreholes—critical for installing kilometers of geothermal pipes.

• Growth Factor: Strategic investments in geothermal startups (such as Google partner Fervo Energy). The “FlexRigs” are specially adapted for the precise horizontal drilling that is crucial for EGS systems.

• Strategy: Transition from a pure equipment rental company to a software and automation group for green baseload power; the goal is to become an indispensable hardware supplier for the geothermal revolution.

• Opportunities: Market leadership in state-of-the-art AC rigs; high margin potential through the transition to the Software-as-a-Service model (AutoSlide); strong global presence following the acquisition of KCA Deutag.

• Risks: Dependence on U.S. shale oil activity (Permian Basin); high capital requirements for maintaining the massive fleet; competition from integrated service giants such as Halliburton.

Weatherford International ($WFRD (-1,84 %))

• Profile: A specialist in well construction and management. Weatherford offers niche technological solutions in extreme environments.

• Technology: They have developed solutions that withstand temperatures of over 400 °C+ (Supercritical Geothermal). Their packers and seals use metal-to-metal connections that remain stable under extreme heat.

• Growth Factor: A trusted partner for “extreme” deep-well projects set to become commercial in 2026/27. Also benefits from “well intervention” (maintenance) to resolve scaling issues in geothermal wells during ongoing operations.

• Digitalization: With the ForeSite® platform, they optimize flow and heat extraction with minimal pumping effort.

• Opportunities: Unique technological position in the “supercritical geothermal” sector (400 °C+); strong pricing power for specialized sealing systems; recurring revenue from maintenance and scale management.

• Risks: Historically volatile financial performance (despite a successful turnaround); heavy reliance on extreme-depth projects that could fail due to technological challenges; geopolitical risks in emerging markets.

3. Infrastructure & Specialty Materials

Vallourec ($VK (-0,39 %))

• Profile: French specialist in seamless steel pipes and premium connection solutions (OCTG), focusing on the high-end segment.

• Technology: Geothermal drilling requires significantly higher-quality pipes than traditional gas drilling to prevent corrosion caused by aggressive deep-well water. Vallourec supplies Thermosoc™ (vacuum-insulated pipes) to prevent heat loss during ascent.

• Differentiation: The patented VAM® threaded connections remain gas-tight even when the metal expands or contracts extremely due to massive temperature fluctuations.

• SStrategy: Transformation into an enabler for deep geothermal energy; benefits from ESG requirements through low-carbon production (electric arc furnaces).

• Opportunities: Global market leader in premium connections (VAM®); high barriers to entry due to specialized materials technology; rising demand for vacuum-insulated pipes (Thermosoc™).

• Risks: Fluctuating steel prices and energy costs in production; competition from cheaper but lower-quality Asian suppliers; currency risks (euro/dollar).

Expro Group Holdings ($XPRO)

• Profile: Provider of well services and energy solutions for the entire life cycle of a well.

• Core Business: Focus on well flow management. They measure pressure, temperature, and brine composition in real time and monitor the integrity of the equipment.

• Innovation: Wireless data transmission via sound waves through the steel casing, since conventional cables would melt in the heat.

• Growth Factor: A profitable growth proxy (“reservoir caretaker”) that benefits directly from increased investment in the maintenance of deep reservoirs. Asset-light model with high margins driven by recurring maintenance contracts.

• Opportunities: The asset-light model ensures high cash flow margins; technological leadership in wireless data transmission; long-term service contracts secure revenue for decades.

• Risks: Lower growth volume compared to pure plant builders; dependence on the willingness of major power plant operators to invest; shortage of specialized engineers.

4. The Hybrid Specialist (Lithium-Geothermal)

Vulcan Energy Resources ($VUL (-4,29 %))

• Profile: A company that builds geothermal power plants in the Upper Rhine Graben to simultaneously extract emission-free lithium for electric vehicle batteries.

• Technology & Operations: Utilization of Direct Lithium Extraction (DLE) from hot brine flows, coupled with geothermal power and heat generation. Activities range from exploration to commercial operation (Phase 2026: scaling).

• Revenue Model: Revenue comes from the sale of low-carbon lithium products (offtake agreements with VW, Renault, and Stellantis), electricity supplies, and district heating for municipalities.

• Opportunities: ESG appeal due to “zero-carbon lithium”; local European supply chain. First-mover advantage and strong political tailwind from the EU Critical Raw Materials Act.

• Risks: Scaling up DLE extraction to an industrial scale is challenging; project expansion could be delayed or become more expensive. Permitting, financing, and local acceptance risks, as well as price risks in the lithium market (risk of dilution).

Strategic Conclusion: The Dawn of “24/7 Clean Firm Power”

The energy market of 2026 could mark the end of the era in which renewable energy was considered weather-dependent. Deep Geothermal 2.0 bridges the critical gap between the massive energy demand of AI infrastructure and the global imperative for decarbonization.

We see a rare convergence here:

Technology Transfer: The expertise of the oil industry (H&P, Baker Hughes, Vallourec) is becoming an enabler for green baseload power.

Sector Coupling: Vulcan Energy demonstrates that energy generation and raw material extraction (lithium) can function symbiotically.

Consolidation: Constellation Energy’s $26 billion acquisition of Calpine demonstrates that the “big players” now view geothermal energy as a systemically important core component of their portfolio.

The investment narrative: While the first wave of the energy transition was often volatile, this sector could now combine the predictability of traditional baseload power with a significantly better ESG profile over the long term. Those who invest today in the “turbine manufacturers” and operators of this infrastructure are betting on the foundation upon which the digital economy of the next decade will be built.

My personal growth conclusion: Where is the greatest potential?

As a growth investor in 2026, I’m looking for companies that not only deliver stable cash flow but also have the potential for massive scaling and above-average margin expansion thanks to unique technological advantages. In this landscape, two favorites stand out to me:

1. The technological enabler: Helmerich & Payne ($HP (+2,74 %))

H&P is the classic “pick-and-shovel” bet, but with a crucial software edge. Thanks to its AutoSlide software (“autopilot for directional drilling”), the company is transforming itself from a capital-intensive rig lessor into a true technology partner. By controlling the specialized FlexRigs (“flagship drilling rig” + the gold standard for modern automated onshore drilling), which are indispensable for modern EGS (Enhanced Geothermal Systems) operations, they earn revenue from every meter drilled for tech giants like Google.

2. The High-Risk/High-Reward Hybrid: Vulcan Energy Resources ($VUL (-4,29 %))

Here, investors are betting on the convergence of two megatrends: renewable baseload power and securing local raw material supplies. Vulcan is on the cusp of industrial-scale expansion in 2026. With binding off-take agreements from giants like VW, Stellantis, and Renault, growth is no longer a matter of sales but purely one of operational execution. Those speculating on a potential “tenbagger” and willing to tolerate volatility will find the most exciting hybrid model on the market here.

Strategic Assessment: While H&P, as a hardware supplier, provides the “safety net” for geothermal investors, Vulcan Energy represents a bold bet on an entirely new industrial model combining energy and lithium mining.

Is Deep Geothermal 2.0 the long-awaited “nuclear killer”? While we’ve been debating nuclear power for decades—and investing billions in new plants—geothermal energy seems to be solving the baseload issue almost silently and decentralized. Are you already betting on “shovel sellers” like H&P and Baker Hughes in your portfolio, or are we still overestimating the scaling potential of deep geothermal energy?

Best regards,

Anderlé ✌🏼

Dear Community,

In the last analysis, we saw how the nuclear renaissance and SMRs are set to satisfy the huge hunger for electricity of AI data centers. But while the world debates megawatt hours and power grids, the biggest challenge of decarbonization often remains in the shadows: industrial process heat. industrial process heat.

Steelworks, chemical parks and glass factories don't need batteries for laptops - they need constant heat of 500 to over 1,500 degrees Celsius. Until now, there was no alternative to natural gas. But a new generation of "shovel sellers" is preparing to revolutionize this market. Those who bridge the gap between energy generation and thermal storage will find companies that are building system-critical infrastructure for the next 50 years, far removed from the tech hype.

So after water and nuclear power, let's take a look at the "thermodynamic champions" - those companies that store heat, control steam and use the earth as an eternal battery. It is the next logical and still massively underestimated step.

While everyone is talking about electricity, industrial process heat is the "elephant in the room". Industry consumes more energy for heat than for electricity worldwide. A gigantic market is currently emerging here, closing the gap between fluctuating renewables and the constant hunger of factories.

The three pillars of the analysis:

• Thermal batteries (Iron & Brick Storage). Companies are developing systems that use surplus wind or solar power to heat huge blocks of graphite, firebrick or molten salt. These "batteries" then release the energy over days as process steam. Important players here are Rondo Energy (supported by Bill Gates) or listed companies such as Alfa Laval.

• Geothermal energy 2.0 (Next-Gen Geothermal). Thanks to drilling technology from the oil sector, it is now possible to drill deeper and more precisely than ever before (Enhanced Geothermal Systems). The aim is to tap into base load-capable geothermal energy all over the world, not just in volcanic hotspots.

• The interface to the nuclear report (VHTR). The new generation of Very High Temperature Reactors (VHTR) not only produces electricity, but also industrial heat directly. This makes them direct partners for chemical parks such as BASF or Dow. SMRs can not only feed data centers, but also decarbonize entire industrial clusters.

1. the specialists for heat transfer & storage

Alfa Laval ($ALFA (+0,24 %)
) is a Swedish veteran and world market leader in heat exchangers. Without this technology, no thermal storage system and no district heating network can function. The company also manufactures separators and filter systems for the process industry.

• Business model: Turnover is generated through plant sales and project-related deliveries. However, recurring revenue from the global service and spare parts network (maintenance, inspection, retrofitting) is particularly lucrative.

• Opportunities & risks: As a technology leader, Alfa Laval is benefiting massively from decarbonization and green hydrogen. However, dependence on global cycles in shipbuilding and the oil industry remains a risk. Price pressure from cheaper competitors and fluctuating raw material costs can put pressure on margins. An important checkpoint is the order intake in the marine sector (CO2 capture).

GEA Group ($G1A (+0,82 %)
) has established itself as a specialist for process technology, with a strong focus on the "Heating & Refrigeration" division. They build gigantic industrial heat pumps that make waste heat from factories or data centers usable again.

• Business model: GEA supplies both individual machines and complete production lines for the food and pharmaceutical industries. The after-sales business with high margins stabilizes sales and extends customer relationships through digital optimization tools.

• Opportunities & risks: The model is very defensive and benefits from the stable demand for hygiene and efficiency solutions. One disadvantage is the lower growth rates compared to tech players. In addition, fluctuating incoming orders for major projects can have a short-term negative impact on cash flow. Investors should keep a close eye on the margin development of the heat pump division.

Spirax-Sarco Engineering ($SPX (+1,11 %)
) is the British market leader for steam systems. As energy in industry is usually transported via steam, Spirax converts factories worldwide to electric steam generation and highly efficient condensate systems.

• Business model: The company combines product sales (valves, pumps, control technology) with intensive engineering consulting and maintenance contracts. There is a strong focus on aftermarket relationships.

• Opportunities & risks: There is no alternative to steam in sectors such as chemicals or pharmaceuticals, which gives Spirax strong market leadership and pricing power (moat). However, the valuation (P/E ratio) is often very high and there is an exchange rate risk due to the British pound. It must be critically examined whether the integration of new acquisitions in the area of electrical thermal solutions will succeed smoothly.

2. geothermal energy & district heating infrastructure

Ormat Technologies ($ORA (-1,27 %)
) is probably the best-known "pure play" for geothermal energy. They build and operate plants that convert geothermal energy into electricity and useful heat. Ormat Technologies is the established market leader in this field.

• Business model: As a vertically integrated provider, Ormat earns money from plant construction, the sale of OEM equipment and long-term power supply agreements (PPAs). The portfolio is currently being expanded to include energy storage and solar hybrid solutions.

• Opportunities & risks: Ormat is a beneficiary of the US Inflation Reduction Act and offers genuine, renewable base load capacity. Risks are inherent in the nature of the business: geothermal energy is capital intensive and there are drilling and permitting risks. An important milestone is the progress made with the "Enhanced Geothermal" pilot projects in cooperation with Google.

Ariston Group ($ARIS (-0,52 %)
) produces highly efficient solutions for water and space heating. While many think of private homes, Ariston is increasingly supplying systems for commercial and industrial hot water applications.

• Opportunities & risks: The mandatory refurbishment of old heating systems in Europe is a massive driver. Ariston has a strong brand name and focus on the European continent. The risk lies in the tough competition with Asian giants such as Daikin or Samsung and the dependence on the construction sector, which is suffering from the economic downturn. Gaining market share in commercial hybrid solutions is the decisive factor here.

3. high temperature technology & materials

Vesuvius plc ($VSVS (-0,9 %) ) specializes in refractory materials (refractories). These are essential to keep heat at up to 1,500 degrees in storage systems without the system melting.

• Opportunities & risks: As a niche specialist, Vesuvius is indispensable for the new storage infrastructure. However, the biggest risk is the close link to the currently struggling steel industry. Investors should pay attention to how quickly the share of sales outside the traditional metallurgy sector (e.g. new energy storage systems) grows.

SGL Carbon ($SGL (-2,13 %)
) supplies specialty graphite, one of the best heat conductors for extreme temperatures, which is required in high-temperature furnaces and chemical processes.

• Business model: SGL operates in the areas of graphite materials and composite materials (carbon fibers). They offer customer-specific solutions, which are often specially coated or refined.

• Opportunities & risks: Graphite is a key material for semiconductor production and the heat management of modern thermal batteries. SGL is considered a turnaround candidate with a strategically important portfolio, but has historically struggled with a volatile share price and high expectations.

4. the system integrator: Siemens Energy ($ENR (-0,02 %)
)

Siemens Energy covers the entire spectrum - from huge thermal energy storage systems based on volcanic rock (ETES) to hydrogen-capable gas turbines.

• Business model: Revenue is generated from plant sales, project engineering and long-term service contracts for grid infrastructure and power plants. Siemens often acts as a general contractor for the decarbonization of entire industrial sites.

• Opportunities & risks: The broad positioning makes the company a beneficiary of the global energy transition. However, the risks lie in the known legacy issues of the wind subsidiary Gamesa as well as in political risks and a complex Group structure. The stabilization of the wind division remains the basic prerequisite for being able to fully assess the potential of the heat assets.

Strategic conclusion

Why is this topic so exciting? There is hardly any "hype" at the moment, which allows for attractive entry prices compared to AI stocks. It is a real ESG magnet as it solves the most difficult problem of the energy transition. It also has a clear infrastructure character: it involves hard assets, patents and long-term industrial contracts - just like the water and nuclear sectors. The industrial heat transition is the missing piece of the puzzle to future-proof an energy portfolio.

How do you assess the situation? Is the industrial heat transition underestimated as a 'sleeping giant' because it receives less media hype than SMRs or e-mobility? And which of these companies do you think has the most convincing business model to benefit from the decarbonization of industry in the long term?

Best regards ✌🏼

Anderlé

Hi. Has anyone here already $ORA (-1,27 %) on the list? I find them quite interesting. GEOthermics and renewables and heat recovery. All topics that are doing well alongside the growth of data centers. BESS on top. An established player with a diversified portfolio. The last figures also looked good. 18% increase in sales, 9.3% profit growth. There is a mini dividend at the top.

What do our specialists say about this stock?

@EpsEra
@Tenbagger2024