Legal and Institutional Framework for Geothermal Development

R. G. Bloomquist

The legal and institutional framework within which geothermal energy in the United States must develop had its origin in the early 1970s. The first impetus for such a framework was the early, successful development of The Geysers geothermal field in northern California. The second impetus came from the 1972 oil embargo, which raised the demand for establishing federal and state financial incentives to encourage more rapid development of geothermal energy.

The legal and institutional framework developed by the state and federal governments commonly differed substantially in format, content, and direction. Too commonly the legal and institutional framework left many questions unanswered, and in some cases, has proven to be more of an obstacle to development than an aid.

Upon examining how state and federal governments have addressed the needs of geothermal development, and how the courts have interpreted these decisions, it has become clear that the legal and institutional framework must address the following topics to serve adequately the needs of geothermal development: (1) providing developers with access and a priority right to carry out exploration and development activities; (2) characterizing the resources so as to minimize conflicts with other natural resources; (3) establishing ownership; and (4) giving careful consideration to such lease terms as rentals, royalties, renewals, and diligence requirements.

In addition, the framework must address groundwater law and its implications for geothermal development, and how geothermal development will be considered in terms of established utility law.

AAPG Search and Discovery Article #91040©1987 AAPG Rocky Mountain Section Meeting, Boise, Idaho, September 13-16, 1987.