Podcast Summary: Currents Ep338 – A New Use for Old Wells

Host: Todd Alexander (Norton Rose Fulbright)
Guest: Kemp Gregory, CEO of Renewal Energy
Release Date: March 5, 2026

Episode Overview

In this episode, Todd Alexander interviews Kemp Gregory, CEO of Renewal Energy, an innovator transforming idle oil and gas wells into gravity-based energy storage facilities. Their discussion delves into the technical, financial, and environmental aspects of this novel approach, which addresses America’s vast inventory of abandoned wells while providing a low-cost energy storage solution for the evolving grid.

Key Discussion Points & Insights

How the Technology Works

• Conversion of Old Wells: Renewal Energy repurposes idle oil and gas wells for gravity-based energy storage by lowering and raising heavy weights suspended in the well via a wire rope attached to a regenerative winch.
  • “What we do is we take idle oil and gas wells, we convert them into gravity based energy storage and we do that by moving a weight up and down inside the wellbore…” (Kemp Gregory, 00:56)
• Technical Details:
  • Pilot installation uses a 30,000-pound weight moving up to 7,000 feet deep within a water-filled well.
  • The system uses a 1-inch wire rope connected to a regenerative winch — acting as both motor and generator depending on weight movement.

Storage Mechanism and Efficiency

• Energy Storage Process:
  • Electricity from the grid powers the winch to lift the weight during periods of low prices; lowering the weight generates electricity for the grid during peak demand.
  • The well is filled with water, but the energy transfer is mechanical, not hydraulic.
• Efficiency:
  • Current systems achieve ~60% round-trip efficiency, compared to ~80% for lithium-ion batteries and pumped hydro. Kemp believes the system could reach 70%.
  • “So the round trip efficiency that we have tested in the field today is about 60%... But what utilities care more about than efficiency is cost.” (03:31)
• Cost Advantage:
  • Projected storage cost is about $5/kWh, compared to $300/kWh for lithium-ion and a goal of $100/kWh in best-case projections.

Siting and Market Opportunity

• Well Selection Criteria:
  • Wells evaluated on depth, diameter, straightness, casing integrity, connection to grid infrastructure, local storage value, and high plug & abandonment (P&A) costs.
  • The P&A service fee paid by oil/gas companies offsets project capex.
  • “Our insight was, hey, these oil and gas companies have to spend all this money on plug and abandonment... There's a way that if you can get them a new option... they will pay you for this new method...” (06:24)
• Scale of Opportunity:
  • U.S.: Over 900,000 active wells (~700,000 low-output ‘stripper’ wells), 2.1 million idle wells, and 100,000–500,000 orphaned wells.
  • 70% of idle wells have grid infrastructure (e.g., pump jacks use electricity).
• Environmental & Fiscal Impact:
  • Repurposing idle wells can prevent them becoming taxpayer liabilities as orphan wells.
  • “We’re sort of waving our flag saying like, hey, there’s a better way we can do something better than just filling them full of cement and cutting their heads off or neglecting them…” (09:08)

Business & Funding Model

• Early Backing & Grants:
  • Initial funding came from faculty at Stanford, followed by VC and $3.1M+ in DOE (ARP-E) grants and $6.4M from California and Kern County.
  • “Since then we’ve raised a seed round... And then because our story is so good, we've actually had a lot of good fortune in winning grants.” (12:25)
• Dual Revenue Streams:
  • Fee from oil & gas companies for meeting their P&A obligations under regulatory oversight.
  • Sale of low-cost storage capacity/services to utilities.

Project Status and Deployment Plan

• Current Installations:
  • One commercial-scale pilot (“Alpha”) operational in California's Central Valley with California Resources Corporation.
• Short-Term Plan (12 months):
  • Permit and install at least two more systems (“Beta,” “Beta 2”).
  • Funded for five total; ambition to scale up to 25 and beyond.
• Investment Tax Credit (ITC):
  • Technology qualifies for ITC; key for economic viability.
  • “Yes. Yeah. Thank God that survived.” (15:25)
• Cost Trajectory:
  • By the 25th system, goal is "$0 per kilowatt hour" (net of P&A fees and ITC), making hardware almost entirely paid for by externalities.
  • “By 25 systems we think we could reach $0 per kilowatt hour... I say I build free energy storage just to see their eyes pop.” (16:13)

Market Potential and Impact

• Target Markets:
  • Areas with high peak electricity prices and abundant suitable wells — especially where grid enhancement and renewables integration are critical.
• Grid Relevance:
  • Grid constraints make siting storage next to generation/load centers increasingly important.
  • “The grid we have today is probably the grid we're all going to get going forward. Nobody's building a lot of high voltage lines...” (09:35)
• Long-Term Projection:
  • Targeting 650 MW capacity by 2032–2033.
  • “We want to have something like 650 megawatts of capacity by like 2033 or 2032.” (19:46)
• Role in Grid Transition:
  • Not a “silver bullet,” but a scalable, flexible, low-cost storage solution to complement other technologies.
  • “We’re not going to provide all the energy storage the nation needs, but we will be the lowest cost, most flexible version of energy storage.” (20:03)

Notable Quotes & Memorable Moments

• “I build free energy storage just to see their eyes pop.”
  — Kemp Gregory, on cost model for venture capitalists (16:13)
• “Don’t let the orphan well apocalypse happen... we can do something better than just filling them full of cement and cutting their heads off or neglecting them, which is the two options that really happened today.”
  — Kemp Gregory (09:08)
• “The grid we have today is probably the grid we’re all going to get going forward. Nobody’s building a lot of high voltage lines.”
  — Kemp Gregory (09:35)
• “Even if this isn’t going to be the silver bullet, as you say, that solves all our needs. At least it can help address some of them.”
  — Todd Alexander (20:16)

Timestamps for Important Segments

• [00:56] — Gravity-storage approach and technical description
• [03:31] — Efficiency and cost comparisons to batteries/hydro
• [05:33] — Well selection criteria and dual-service model
• [07:36] — The scale of idle and orphan wells; regulatory context and environmental importance
• [12:25] — Funding journey: initial backers, grants, and fundraising milestones
• [14:04] — Status of installations and next steps
• [15:25] — Investment tax credit applicability
• [16:13] — Discussion of future cost per kWh and business model
• [17:58] — The need for flexible energy storage in today's grid and the opportunity for Renewal Energy
• [19:46] — Long-term capacity targets and industry comparison

Overall Tone & Takeaways

The conversation is candid, insightful, and permeated by optimism about the role of innovative, cost-effective solutions in addressing both the energy transition and the environmental legacy of oil and gas. Kemp Gregory’s tone is equal parts technical, entrepreneurial, and driven by a mission to "flip a liability into an asset."

For listeners interested in project finance, energy innovation, or pragmatic climate solutions, this episode offers a grounded yet forward-thinking roadmap to the potential of repurposing oilfield infrastructure for the green transition.