Executive Summary

Q4 2024 was dominated by a strategic pivot post-FEED: SN1 (Project Permian) total installed cost was reset to $1.7–$2.0B, long‑lead releases were paused, and management launched a value‑engineering program and a modular multi‑unit roadmap aimed at restoring project financeability and lowering LCOE .
Validation progressed: La Porte Phase 1 testing logged 140 fired hours, achieved a 30‑hour continuous run, and exceeded prior cycle pressures; Phases 1–2 remain on track to complete in 2025, with Phase 3 in 2026 and Phase 4 in 2027 .
Liquidity remained strong at $0.533B; Q4 operating cash outflow was ~$13M and capex ~$29M (La Porte + SN1), underscoring ample runway to execute 2025 priorities (validation, cost reductions, modular design) .
Timeline and funding reset: earliest SN1 online date is now 2029; management estimates ~$600M project debt capacity, has earmarked $200M of corporate liquidity, and sees a remaining $600–$900M funding gap to fully finance SN1 (project‑ and/or corporate‑level solutions under evaluation) .
Near‑term stock catalysts: concrete value‑engineering milestones (cost down from FOAK TIC), clarity on SN1 financing partners/structure, Phase 1–2 validation readouts, and policy developments around 45Q utilization parity and credit levels .

What Went Well and What Went Wrong

What Went Well
- Validation momentum: “over 140 fired hours” at La Porte, 30‑hour continuous run, and pressures/temperatures above the 2021 campaign; Phase 1–2 on track to complete in 2025 .
- Strategic cost‑down roadmap: launch of standardized modular multi‑unit (2–4 packs) targeting up to 1 GW and coastal siting to unlock economies of scale and logistics savings .
- Industrial platform optionality: Baker Hughes and Woodside agreed to develop an industrial‑scale NET Power solution, a pure licensing opportunity (minimal NPWR capital) that broadens TAM (LNG, O&G, heavy industry, small data centers) .
What Went Wrong
- FOAK cost shock: SN1 TIC reset to $1.7–$2.0B (≈100% over early 2023 view) driven by sector‑wide inflation and Permian‑specific factors (inland logistics, water treatment, high N2 gas); long‑lead releases paused .
- Timeline slip: earliest SN1 online date pushed to 2029 versus prior 2H27–1H28 initial generation window .
- Financing visibility: despite strong liquidity, management still needs $600–$900M of new capital to fully fund SN1 alongside ~$600M project debt and $200M corporate allocation .

Financial Results

Note: NET Power is a development‑stage licensor; no revenue/EPS were disclosed in the Q4 2024 8‑K. Management focused disclosures on liquidity, operating cash flows, and capex .

Metric (USD)	Q2 2024	Q3 2024	Q4 2024
Cash & Investments End of Period	$609M	$580M	$533M
Operating Cash Used	~$8M	~$8M	~$13M
Capital Expenditures (Total)	~$8M	~$22M	$28.9M (La Porte $8.5M; SN1 $20.4M)

Revenue/EPS vs estimates: Not applicable; company did not disclose revenue/EPS and remains pre‑commercial in Q4 2024 . Wall Street consensus from S&P Global was unavailable via tool today; therefore, no beats/misses can be assessed for revenue or EPS.

KPIs and Program Milestones

KPI	Q2 2024	Q3 2024	Q4 2024
La Porte Validation Status	Phase 1 scheduled to begin Q4’24	Commissioning started; BH rig installed	140 fired hours; 30‑hr continuous run; pressures >2021; Phases 1–2 to complete 2025
SN1 FEED	Ongoing (conclude Q4’24)	On track to conclude Q4’24	Completed; TIC set to $1.7–$2.0B; value engineering launched
Site Footprint Reduction (SN1)	—	—	~25% reduction identified via value engineering
LNTP / Long‑Lead Actions	LNTP to release long leads for turboexpander	~$90M LNTP for turboexpander & KPEP; transformers ordered	Further long‑lead releases paused pending funding

Project Permian (SN1) Economics & Schedule

Item	Prior	Current (Q4 2024)	Change / Rationale
Total Installed Cost (TIC)	Early public views: ~$0.95B (2023), then ~$1.1B (management context)	$1.7–$2.0B	Raised; inflation, supply chain tightness, inland logistics, water treatment, high N2 gas
Earliest Online Date	Initial power generation 2H 2027–1H 2028	No earlier than 2029	Pushed; value engineering, funding sequence
Long‑Lead Releases	LNTPs signed; orders placed (Q3)	Further long‑leads paused pending funding	Risk control; preserve flexibility
Value Engineering	—	Extensive program; ~25% footprint reduction	Cost, schedule optimization
Funding Plan	—	~$600M project debt capacity; $200M corporate earmarked; $600–$900M new capital needed	Multi‑pronged approach (project, TopCo, public programs, commercial partners)

Guidance Changes

Metric/Area	Period	Previous Guidance	Current Guidance	Change
SN1 TIC (Total Installed Cost)	FOAK SN1	— / management context ~$0.95–$1.1B (historical references)	$1.7–$2.0B	Raised due to inflation, site specifics, FOAK scope
SN1 Earliest Online	In‑service	Initial generation 2H’27–1H’28	No earlier than 2029	Lowered/Delayed
Long‑Lead Releases (SN1)	2025 execution	Proceeding with releases (Q3)	Paused pending funding; VE ongoing	Paused
La Porte Validation	2025–2027	Phase 1 kick‑off Q4’24; multi‑year campaign	Phases 1–2 complete in 2025; Phase 3 2026; Phase 4 2027	Timetable affirmed/clarified
Modular Multi‑Unit Program	2030–2033	—	Feasibility launched; targeting coastal sites up to 1 GW per site	New initiative

Earnings Call Themes & Trends

Topic	Q2 2024 (Q‑2)	Q3 2024 (Q‑1)	Q4 2024 (Current)	Trend
Demand/AI load growth	Origination for data centers/hybrid applications noted	“Unprecedented demand growth” across North America	AI/data centers reinforcing firm power needs; market tight through decade	Strengthening demand narrative
Supply chain & inflation	—	—	Material inflation and tight supply chains; CCGT costs >$2,200/kW	Adverse; cost pressure persists
SN1 timeline	Initial gen 2H’27–1H’28	Same window	Earliest 2029; long‑leads paused	Pushed right
La Porte validation	Phase 1 starts Q4’24	Commissioning underway	140 fired hours; 30‑hour run; Phases 1–2 2025	Executing to plan
Modularization/coastal	—	—	Feasibility study; coastal siting 2030–33, 2–4 packs	New cost‑down vector
Partnerships	—	Air Liquide ASU; ~$90M LNTP to BH	BH + Woodside industrial platform (licensing)	Expanding
Policy/45Q	—	—	Discussed potential 45Q utilization parity/increases aiding economics	Potential tailwind

Management Commentary

“We…completed the FEED for Project Permian…[but] initial cost estimates reveal areas where we can meaningfully and efficiently reduce costs…We believe our shift in focus to remove or reduce these costs…will better position Net Power to achieve the lowest costing clean, firm power available in the market.” — CEO Danny Rice .
“We…identified hundreds of opportunities to value engineer the design and to date have already reduced the site footprint by approximately 25%…Our goal remains to get total installed cost as close to $1.7 billion as possible or below.” — President/COO Brian Allen .
“We closed 2024 with $533 million in cash, cash equivalents and investments…We believe current SN1 economics can support up to approximately $600 million in project level financing…leaves roughly $600 million to $900 million in new capital needed to fully fund the project.” — CFO Akash Patel .
“We consider ourselves energy realists…It’s hard to see nuclear as a viable option for at least the next decade…We think we’re still years ahead of competing technologies.” — CEO Danny Rice .

Q&A Highlights

Capex drivers: Management cited supply‑demand imbalances (electrical gear), general escalation, FOAK scope, and site‑specific issues (Permian gas nitrogen content requiring purification; inland logistics; costly water treatment) as key TIC drivers; no granular breakouts provided .
Cost deflation outlook: Team does not assume sector‑wide capex deflation near‑term; core cost‑down hinges on multi‑unit modularization and coastal logistics advantages rather than macro relief .
Funding pathways: Four levers under evaluation — project‑level capital, TopCo capital, government support (DOE/Texas Energy Fund), and commercial partnerships with offtakers/strategics .
Modular milestones: Value‑engineering for SN1 continues; multi‑unit coastal feasibility/pre‑FEED underway in 2025 with future milestones to be laid out in subsequent quarters .
Policy backdrop: Management discussed possible 45Q utilization parity with sequestration and inflation adjustments (hypothetical move toward ~$105/ton); would be beneficial if enacted .

Estimates Context

S&P Global (Wall Street) consensus for Q4 2024 revenue/EPS was not available via the tool today; moreover, NPWR did not disclose revenue or EPS in its Q4 8‑K, reflecting its pre‑commercial status . As a result, we cannot assess beats/misses versus consensus for revenue or EPS this quarter.

Key Takeaways for Investors

FOAK cost reset is the pivotal development: raising SN1 TIC to $1.7–$2.0B and pausing long‑leads resets expectations on timeline (earliest 2029) but should improve financeability once value‑engineering lands .
Execution de‑risks the tech: La Porte validation momentum (140 fired hours, 30‑hour run) and a clear 2025–2027 validation cadence are important precursors to commercial confidence .
Cost‑down path is credible but staged: multi‑unit modularization and coastal siting create tangible vectors for lower LCOE; investors should track feasibility outputs and any standard‑plant cost targets disclosed in 2025–2026 .
Financing bridge remains the swing factor: with ~$0.533B liquidity and an estimated $600–$900M gap to fully fund SN1, the structure/mix of project debt, strategic capital, and public support will drive timing and dilution risk .
Policy optionality could matter: potential changes to 45Q (utilization parity/increases) would improve economics; monitor federal/state energy support programs in 2025 .
Trading lens: Near‑term volatility likely around cost‑down milestones, validation updates, and funding announcements; medium‑term thesis hinges on proving competitive LCOE via modular/coastal deployments and securing anchor partners/offtake .

Citations

Q4 2024 8‑K press release and disclosures:
Q4 2024 earnings presentation:
Q4 2024 earnings call transcript:
Q3 2024 8‑K:
Q2 2024 8‑K:

NET Power Inc. (NPWR)·Q4 2024 Earnings Summary