[House Hearing, 118 Congress]
[From the U.S. Government Publishing Office]
DISCUSSION DRAFT OF H.R. ____,
``CORE ACT'';
H.R. 7053, H.R. 8665, AND H.R. 8954
=======================================================================
LEGISLATIVE HEARING
before the
SUBCOMMITTEE ON ENERGY AND
MINERAL RESOURCES
of the
COMMITTEE ON NATURAL RESOURCES
U.S. HOUSE OF REPRESENTATIVES
ONE HUNDRED EIGHTEENTH CONGRESS
SECOND SESSION
__________
Tuesday, July 23, 2024
__________
Serial No. 118-136
__________
Printed for the use of the Committee on Natural Resources
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Available via the World Wide Web: http://www.govinfo.gov
or
Committee address: http://naturalresources.house.gov
______
U.S. GOVERNMENT PUBLISHING OFFICE
56-358 PDF WASHINGTON : 2025
COMMITTEE ON NATURAL RESOURCES
BRUCE WESTERMAN, AR, Chairman
DOUG LAMBORN, CO, Vice Chairman
RAUL M. GRIJALVA, AZ, Ranking Member
Doug Lamborn, CO Grace F. Napolitano, CA
Robert J. Wittman, VA Gregorio Kilili Camacho Sablan,
Tom McClintock, CA CNMI
Paul Gosar, AZ Jared Huffman, CA
Garret Graves, LA Ruben Gallego, AZ
Aumua Amata C. Radewagen, AS Joe Neguse, CO
Doug LaMalfa, CA Mike Levin, CA
Daniel Webster, FL Katie Porter, CA
Jenniffer Gonzalez-Colon, PR Teresa Leger Fernandez, NM
Russ Fulcher, ID Melanie A. Stansbury, NM
Pete Stauber, MN Mary Sattler Peltola, AK
John R. Curtis, UT Alexandria Ocasio-Cortez, NY
Tom Tiffany, WI Kevin Mullin, CA
Jerry Carl, AL Val T. Hoyle, OR
Matt Rosendale, MT Sydney Kamlager-Dove, CA
Lauren Boebert, CO Seth Magaziner, RI
Cliff Bentz, OR Nydia M. Velazquez, NY
Jen Kiggans, VA Ed Case, HI
Jim Moylan, GU Debbie Dingell, MI
Wesley P. Hunt, TX Susie Lee, NV
Mike Collins, GA
Anna Paulina Luna, FL
John Duarte, CA
Harriet M. Hageman, WY
Vivian Moeglein, Staff Director
Tom Connally, Chief Counsel
Lora Snyder, Democratic Staff Director
http://naturalresources.house.gov
------
SUBCOMMITTEE ON ENERGY AND MINERAL RESOURCES
PETE STAUBER, MN, Chairman
WESLEY P. HUNT, TX, Vice Chair
ALEXANDRIA OCASIO-CORTEZ, NY, Ranking Member
Doug Lamborn, CO Jared Huffman, CA
Robert J. Wittman, VA Kevin Mullin, CA
Paul Gosar, AZ Sydney Kamlager-Dove, CA
Garret Graves, LA Seth Magaziner, RI
Daniel Webster, FL Nydia M. Velazquez, NY
Russ Fulcher, ID Debbie Dingell, MI
John R. Curtis, UT Raul M. Grijalva, AZ
Tom Tiffany, WI Grace F. Napolitano, CA
Matt Rosendale, MT Susie Lee, NV
Lauren Boebert, CO Vacancy
Wesley P. Hunt, TX Vacancy
Mike Collins, GA
John Duarte, CA
Bruce Westerman, AR, ex officio
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CONTENTS
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Page
Hearing Memo..................................................... v
Hearing held on Tuesday, July 23, 2024........................... 1
Statement of Members:
Stauber, Hon. Pete, a Representative in Congress from the
State of Minnesota......................................... 2
Ocasio-Cortez, Hon. Alexandria, a Representative in Congress
from the State of New York................................. 3
Panel I:
Gosar, Hon. Paul, a Representative in Congress from the State
of Arizona................................................. 5
Hunt, Hon. Wesley P., a Representative in Congress from the
State of Texas............................................. 39
Statement of Witnesses:
Panel II:
Van Liew, Dustin, Vice President, EnerGeo Alliance, Houston,
Texas...................................................... 6
Prepared statement of.................................... 7
Rogers, Terra, Program Director, Superhot Rock Energy, Clean
Air Task Force, Boston, Massachusetts...................... 13
Prepared statement of.................................... 15
Supplemental documents submitted for the record.......... 23
Sandberg, J.C., Chief Advocacy Officer, The American Clean
Power Association, Washington, DC.......................... 24
Prepared statement of.................................... 25
Feldgus, Steve, Principal Deputy Assistant Secretary for Land
and Minerals Management, Department of the Interior,
Washington, DC............................................. 28
Prepared statement of.................................... 30
Questions submitted for the record....................... 33
Wright, Jim, Commissioner, Railroad Commission of Texas,
Austin, Texas.............................................. 34
Prepared statement of.................................... 35
Additional Materials Submitted for the Record:
Thompson, Hon. Glenn ``GT'', a Representative in Congress
from the State of Pennsylvania, Prepared Statement for the
Record..................................................... 65
Bureau of Ocean Energy Management, Statement for the Record
on the CORE Act............................................ 67
U.S. Geological Survey, Statement for the Record on H.R. 8665 70
Submissions for the Record by Representative Westerman
Cramer, Hon. Kevin, U.S. Senator, Statement for the
Record................................................. 41
Submissions for the Record by Representative Stauber
Environmental Defense Fund, Letter to the U.S. Department
of Interior............................................ 61
Submissions for the Record by Representative Grijalva
Clean Air Task Force, ``Understanding Superhot Rock
Energy in Context''.................................... 72
Submissions for the Record by Representative Levin
EDF Renewables, Letter to the Committee in support of
PLREDA................................................. 52
Multiple Organizations, Letter to the Committee in
support of PLREDA...................................... 53
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
To: House Committee on Natural Resources Republican Members
From: Energy and Mineral Resources Subcommittee Staff, Rob
[email protected], x6-2466 and Will
King--Will.King @mail.house.gov, x5-9297
Date: Tuesday, July 23, 2024
Subject: Legislative Hearing on H.R. 7053, H.R. 8665, H.R. 8954, and
a Discussion Draft of H.R. ____ (Rep. Hunt)
________________________________________________________________________
The Subcommittee on Energy and Mineral Resources will hold a
legislative hearing on H.R. 7053 (Rep. Thompson of PA), ``Orphan Well
Grant Flexibility Act of 2024''; H.R. 8665 (Rep. Lucas),
``Supercritical Geothermal Research and Development Act''; H.R. 8954
(Rep. Gosar), ``Public Lands Renewable Energy Development Act of
2024''; and a Discussion Draft of H.R. ____ (Rep. Hunt),
``Comprehensive Offshore Resource Evaluation Act'' or the ``CORE Act,''
on Tuesday, July 23, 2024, at 10:30am in 1334 Longworth House Office
Building
Member offices are requested to notify Jacob Greenberg
([email protected]) by 4:30 p.m. on Monday, July 22, 2024,
if their Member intends to participate in the hearing.
I. KEY MESSAGES
Renewable energy projects on federal lands currently pay
fees to the federal government, but those fees are not
shared to host states in the same manner as conventional
energy production on federal lands. H.R. 8954 would fix
this problem by ensuring states and counties secure the
benefits of energy production within their borders.
The Biden administration has unilaterally added new
requirements for funding to plug orphaned wells, resulting
in less wells being plugged. H.R. 7053 would further
clarify the law to ensure plugging of orphaned wells can
continue efficiently.
The CORE Act addresses the urgent need to modernize Bureau
of Ocean Energy Management's (BOEM) resource assessments
and ensure more accurate data collection for offshore oil
and gas production. This will enhance U.S. energy security
and economic stability by bolstering domestic energy
supply, reducing reliance on imports, and increasing
support for local economies through state revenue and job
creation.
II. WITNESSES
Panel I:
Members of Congress (To Be Announced)
Panel II:
Dr. Steve Feldgus, Principal Deputy Assistant Secretary
for Land and Minerals Management, Department of the
Interior, Washington, DC. [H.R. 7053]
Mr. JC Sandberg, Chief Advocacy Officer, The American
Clean Power Association, Washington, DC. [H.R. 8954]
Mr. Dustin Van Liew, Vice President, EnerGeo Alliance,
Houston, TX [``CORE Act'' Discussion Draft]
Mr. Jim Wright, Commissioner, the Railroad Commission of
Texas, Austin, Texas, [H.R. 7053]
Ms. Terra Rogers, Program Director, Superhot Rock Energy,
Clean Air Task Force, Boston, Massachusetts [H.R. 7053 &
H.R. 8665] [Minority Witness]
III. BACKGROUND
Discussion Draft of H.R. ___ (Rep. Hunt), ``Comprehensive Offshore
Resource Evaluation Act'' or the ``CORE Act''
The Outer Continental Shelf (OCS) plays a critical role in the
United States' energy strategy, providing substantial oil and gas
resources that contribute to national energy security, economic
stability, and coastal resiliency goals. The BOEM periodically conducts
resource assessments and regularly prepares 5-year leasing plans as
mandated by the Outer Continental Shelf Lands Act (OCSLA).\1\ These
assessments, which include Undiscovered Technically Recoverable
Resources (UTRR) and Undiscovered Economically Recoverable Resources
(UERR), are crucial for informed decision-making and contribute to 5-
year program planning and development.\2\ UTRR and UERR are critical
components of BOEM's comprehensive inventory and analysis of oil and
natural gas resources beneath OCS waters. These components are reported
to Congress every five years, as required by the Energy Policy Act of
2005 (EPAct05).\3\
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\1\ U.S. Congress. (1953). Outer Continental Shelf Lands Act, as
amended. Pub.L. 83-212.
\2\ BOEM. (2021). 2021 Undiscovered Technically Recoverable
Resources (UTRR) by Play. Retrieved July, 2024, from https://
www.boem.gov/sites/default/files/documents/oil-gas-energy/resource-
evaluation/2021%20UTRR%20by%20Play.pdf
\3\ U.S. Congress. (2005). Energy Policy Act of 2005, as amended.
Pub.L. 109-58.
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The CORE Act seeks to amend EPAct05 to incorporate specific
instructions for future comprehensive inventories, ensuring that
resource assessments include the latest data and methodologies for
accurate and reliable estimates. BOEM's current processes face
challenges in data acquisition, technological integration, and
environmental impact considerations.
Resource Assessments and Offshore Oil and Gas Leasing
The resource assessment process has unfortunately become weaponized
under the Biden administration. The assessments, conducted every five
years and historically two years before the comprehensive inventory
mandated by the EPAct05, are critical for accurate resource estimation.
These undiscovered resource assessments aim to provide appraisals of
unknown, technically, and economically recoverable oil and gas on the
OCS. BOEM asserts that these assessments utilize the latest
geophysical, geological, technological, and economic data to draw their
conclusions but massive fluctuations in resource potential from report
to report, outdated inputs, and seemingly outdated methodology and
processes have sparked oversight of BOEM's procedures.\4\ Further
underscoring their importance, UTRR and UERR assessments influence the
Environmental Impact Statements (EIS) required under the National
Environmental Policy Act (NEPA) for 5-year leasing programs. Accurate
assessments ensure that potential oil and gas resources are thoroughly
analyzed, which is essential for informed decision-making and planning.
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\4\ House Committee on Natural Resources. ``Hearing on Offshore
Energy Development.'' February 26, 2020. https://
naturalresources.house.gov/calendar/eventsingle.aspx?EventID= 415851
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Before unveiling their abhorrent 5-year plan, the Biden
administration issued the 2021 Assessment of Undiscovered Oil and Gas
Resources of the Nation's Outer Continental Shelf. This assessment
showed dramatic fluctuations from the previous estimate under the Obama
administration. In 2016, BOEM reported 91 billion barrels of oil (BBO),
328 trillion cubic feet (TCF) of gas, and 149 billion barrels of oil
equivalent (BOE).\5\ By 2021, these figures had dropped to 68 BBO, 229
TCF of gas, and 109 BOE.\6\ Such changes, not primarily attributable to
drilling, production, or seepage, indicate potentially poor data or
possible manipulation by insertion of inconsistent assumptions, leading
to reduced estimates and misguided policy decisions.
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\5\ Bureau of Ocean Energy Management. ``2016 Undiscovered
Technically Recoverable Resources (UTRR) by Play.'' 2017. https://
www.boem.gov/sites/default/files/oil-and-gas-energy-program/Resource-
Evaluation/Resource-Assessment/2016-UTRR-by-Play_2017-update-%281%
29.pdf
\6\ BOEM. (2021). 2021 Undiscovered Technically Recoverable
Resources (UTRR) by Play. Retrieved July, 2024, from https://
www.boem.gov/sites/default/files/documents/oil-gas-energy/resource-
evaluation/2021%20UTRR%20by%20Play.pdf
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This assessment informed an unacceptable 5-year leasing plan which
offered the lowest number of offshore oil and gas lease sales in the
nation's history. This has raised concerns about the United States'
long-term energy strategy, economic impact on Gulf Coast states, and
national energy security.
The CORE Act seeks to address these issues by improving the
resource assessment process and ensuring comprehensive and up-to-date
data inform federal decision-making. By stipulating specifically what
BOEM should consider in each assessment, there is a lesser chance that
future assessments will be subject to weaponization.
National Security and Transboundary Hydrocarbon Agreements
Bilateral maritime boundary treaties, such as the 1990 US-Soviet
Union (now Russia) Maritime Boundary Agreement and the 2000 US-Mexico
Maritime Boundary Agreement, include provisions on sovereign rights
over natural resources.\7\ These agreements ensure that neither country
can claim resources on the other's side of the boundary. The 2000 US-
Mexico Agreement also addresses transboundary hydrocarbon reservoirs,
establishing a framework for equitable and efficient development of
such resources.\8\ The 2012 US-Mexico Transboundary Hydrocarbon
Reservoirs Agreement further promotes unitization and cooperation.\9\
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\7\ U.S. Department of State. ``Agreement Between the United States
of America and the Union of Soviet Socialist Republics on the Maritime
Boundary.'' June 1, 1990. https://www.state.gov/wp-content/uploads/
2020/02/US_Russia_1990.pdf#page=5
\8\ U.S. Department of State. ``Treaty Between the Government of
the United States of America and the Government of the United Mexican
States on the Delimitation of the Continental Shelf in the Western Gulf
of Mexico Beyond 200 Nautical Miles.'' June 9, 2000. https://
www.state.gov/wp-content/uploads/2020/02/
US_Mexico_2000_withExtension.pdf#page=4
\9\ U.S. Department of State. ``U.S.-Mexico Transboundary
Hydrocarbons Agreement.'' May 2, 2013. https://2009-2017.state.gov/r/
pa/prs/ps/2013/05/208650.htm
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The CORE Act addresses the critical need for enhanced assessment of
transboundary hydrocarbon reservoirs, which are essential in areas
where the U.S. shares oil and gas reserves with neighboring countries.
The current lack of comprehensive data and clear frameworks leaves BOEM
ill-equipped to assess resource potential, jurisdiction, and bilateral
collaboration opportunities in these shared reservoirs. The CORE Act
seeks to rectify this by mandating improved data acquisition and legal
frameworks, ensuring that the U.S. can effectively lease and manage its
resources while coordinating with other nations for equitable and
efficient development. This approach secures our national interests and
fosters international cooperation in resource management.
Geological and Geophysical Permitting
Geological and Geophysical (G&G) surveys are crucial to the
exploration and development of offshore oil and gas resources. These
surveys employ advanced technologies such as 3-D and 4-D seismic
imaging to map and assess the subsurface geological structures beneath
the ocean floor.\10\ Accurate G&G data is essential for identifying
potential hydrocarbon deposits, estimating their size, and
understanding their characteristics. Modern seismic imaging also
reduces risk for exploration and production companies by increasing the
likelihood that exploratory wells will successfully tap hydrocarbons
and decreasing the number of wells that need to be drilled in a given
area.\11\ This information is foundational for resource assessments, as
it provides the data needed to estimate UTRR and UERR.\12\ Reliable G&G
surveys reduce uncertainty in resource estimates, inform drilling and
production decisions, and ultimately support the creation of
comprehensive and accurate inventories of offshore oil and gas
resources. This process aids in the efficient development of energy
resources and ensures BOEM, policymakers and investors have the
necessary information to make informed decisions.
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\10\ Bureau of Ocean Energy Management. ``Geological & Geophysical
(G&G) Data.'' Accessed July, 2024. https://www.boem.gov/oil-gas-energy/
resource-evaluation/geological-geophysical-gg-data
\11\ EnerGeo Alliance. ``Introduction to Marine Seismic
Technologies.'' September 6, 2022. https://energeoalliance.org/Marine-
Seismic-Technologies
\12\ Bureau of Ocean Energy Management. ``2021 Assessment of
Undiscovered Oil and Gas Resources of the Nation's Outer Continental
Shelf.'' Accessed July 2024. https://www.boem.gov/sites/default/files/
documents/oil-gas-energy/2021-Assmt-of-Undiscovered-Oil-Gas-Resources-
OCS.pdf
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The provisions in Section 4 of the CORE Act related to G&G
permitting aim to stimulate exploration activity, which informs future
assessments and improves the operating environment for geophysical and
geotechnical permit applicants. By easing the burdens of permitting
delays at BOEM and the National Oceanic and Atmospheric Association and
mitigating related litigation, these reforms support the timely
delivery of necessary data for accurate resource estimates and energy
supply.
Environmental and Economic Benefits of Offshore Development
Undiscovered oil and gas resources in the OCS have the potential to
significantly boost the U.S. economy while promoting a healthier
environment. Improving BOEM's data acquisition methods will prompt an
increase in domestic oil production which will bring greater energy
security, more affordable energy prices, a lower national trade
deficit, and increased revenue passed to states for vital coastal
restoration and infrastructure projects. Furthermore, energy production
occurring in the Gulf of Mexico is 46% less carbon intensive when
displacing global production in countries like Russia, China, and
Iran.\13\ Economic and environmental studies commissioned in this bill
will ensure that these benefits are adequately considered in BOEM's
leasing programs and across the federal government.
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\13\ National Ocean Industries Association. ``GHG Emission
Intensity of Crude Oil and Condensate Production.'' May 2023. https://
www.noia.org/wp-content/uploads/2023/05/NOIA-Study-GHG-Emission-
Intensity-of-Crude-Oil-and-Condensate-Production.pdf
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
H.R. 7053 (Rep. Thompson of PA), ``Orphan Well Grant Flexibility
---------------------------------------------------------------------------
Act of 2024''
Orphan wells are oil or gas wells that were not plugged and
remediated by energy companies post-production and have no legal owner.
The Infrastructure Investments and Jobs Act (IIJA) directed the
Secretary of the Interior to establish a program to plug orphaned wells
on Federal and Tribal lands and to supplement state orphaned well
programs.\14\ The IIJA provided $4.7 billion for orphaned well site
plugging, remediation and restoration activities on Federal, Tribal,
state, and private lands.\15\ The IIJA created three types of grants
for states to receive funding: Initial Grants, Formula Grants, and
Performance Grants.\16\ The Initial Grants are for states to bolster
their longstanding well plugging programs and build capacity for states
to expand or begin well plugging activities. Formula Grants also
bolster states' well plugging programs to plug, remediate, and reclaim
orphaned wells on state and private lands. Performance Grants are
separated into two categories, Matching Grants and Regulatory
Improvement Grants. Matching Grants are intended to encourage state
orphaned well spending above 2010-2019 spending levels and Regulatory
Improvement Grants are intended to incentivize states to enact laws or
regulations that will reduce future orphaned wells.
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\14\ 42 U.S.C. 15907.
\15\ Id.
\16\ 42 U.S.C. 15907(c).
\17\ U.S. Department of the Interior, Orphaned Wells Program Annual
Report to Congress, November 2023, https://www.doi.gov/sites/default/
files/fy-2023-orphaned-wells-congressional-report.pdf.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Through Fiscal Year 2023, $560 million was distributed to
twenty-four states through Initial Grants, $102 million was distributed
for the federal program and $39 million of Tribal grants were
issued.\18\ While the Initial Grants have been successfully utilized by
states, the Department of the Interior (DOI), through guidance,\19\ has
added burdensome, non-statutory requirements to the Formula Grants. In
the guidance, DOI requires pre and post plugging measurement of
potential air and water pollution for each well.\20\ While the language
in the IIJA does allow for states to use funding to measure and track
pollution, it is clearly optional and not required.\21\ This
requirement has greatly driven up the cost of plugging wells and has
forced some states to forgo the Formula Grant funding. To make matters
worse, DOI has added more requirements in their Formula Grant awards
\22\ that force states to comply with the Endangered Species Act and
the National Historic Preservation Act.
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\18\ Department of the Interior, Orphaned Wells Program Annual
Report to Congress, November 2023, https://www.doi.gov/sites/default/
files/fy-2023-orphaned-wells-congressional-report.pdf.
\19\ U.S. Department of the Interior, State Formula Grant Guidance,
7.07.23, https://www.doi.gov/media/document/state-formula-grant-
guidance-07-07-2023-pdf.
\20\ Id. at 13.
\21\ 42 U.S.C. 15907(c)(2).
\22\ U.S. Department of the Interior, Notice of Award, Texas
Railroad Commission, 1/12/24.
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H.R. 7053 aims to solve this problem by clarifying that states are
not required to conduct pre-plugging or post-plugging pollution
monitoring. By cutting this unnecessary red tape, this bill will
unencumber states so that they may plug more orphaned wells. The bill
would also direct the National Academy of Sciences (NAS) to evaluate
the results of the program with a specific focus on the impacts on
economic development, housing trends, and other potential benefits.
This bill has bipartisan support, with 10 Republicans and 3
Democrats in the Senate including Senators Ted Cruz, John Cornyn, Mike
Lee, John Fetterman, and Robert Casey. On the House side, it is
cosponsored by 4 Republicans and 1 Democrat, including Rep. Estes, Rep.
Reschenthaler, Rep. Hunt, and Rep. Deluzio.
H.R. 8665 (Rep. Lucas), ``Supercritical Geothermal Research and
Development Act''
Supercritical geothermal is an experimental technology that
requires deep drilling to access dry rocks at temperatures around 400+C
or greater. Water or other liquids are then injected at depths of 4
kilometers or deeper and, utilizing natural heat deep within the
Earth's crust, returned to the surface at supercritical conditions to
power a turbine and generate energy.\23\ If commercialized,
supercritical geothermal has the potential to produce energy at
significantly higher capacities compared to conventional geothermal
systems.\24\ The Department of Energy (DOE) estimates that next-
generation geothermal technologies including supercritical geothermal
could provide 90 GW or more of clean firm power to the U.S. grid by
2050.\25\
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\23\ https://science.house.gov/_cache/files/e/e/eebed5c7-3784-4b3b-
b0c5-04c5456dfa77/8600498 DE7130020CA43490E64B3ACBA.h.r.-8665-one-page-
summary.pdf
\24\ Id.
\25\ https://liftoff.energy.gov/wp-content/uploads/2024/03/
LIFTOFF_DOE_NextGen_Geothermal _v14.pdf
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The United States Geological Survey (USGS) currently operates
several programs that support research and development of geothermal
energy resources. The Geothermal Steam Act of 1970 directs USGS to
conduct national scale assessments of geothermal resources, the most
recent of which was published in 2008.\26\ Additionally, the agency's
Earth Mapping Resources Initiative (Earth MRI) coordinates priorities
with DOE's Geothermal Technologies Office (GTO) to collect useful data
for both critical mineral and geothermal resources.\27\
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\26\ https://www.usgs.gov/centers/gmeg/science/geothermal-resource-
investigations-project
\27\ https://d9-wret.s3.us-west-2.amazonaws.com/assets/palladium/
production/s3fs-public/media/files/USGS%20BIL%20Spend%20Plan_FINAL.pdf
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H.R. 8665 establishes a supercritical geothermal research program
at DOE and provides grant opportunities for supercritical geothermal
technologies. The bill also requires DOE and DOI to enter a memorandum
of understanding (MOU) on geothermal data collection and analysis and
directs USGS to update its national geothermal resource assessment
within 180 days of enactment. Lastly, H.R. 8665 orders DOI, in
consultation with DOE, to commission the drilling of exploration
boreholes deeper than 8 kilometers to provide control points for
supercritical heat mapping and geothermal development. H.R. 8665
authorizes $5 million for each of fiscal years 2026 through 2030.
H.R. 8954 (Rep. Gosar), ``Public Lands Renewable Energy Development Act
of 2024''
Title V of the Federal Land Policy and Management Act (FLPMA) \28\
generally requires right-of-way (ROW) grant holders, leaseholders, or
both to ``pay in advance the fair market value'' for use of the public
lands, subject to certain exceptions. For solar and wind generation,
the Bureau of Land Management (BLM) collects from ROW holders the
greater of either an acreage rent or a capacity fee.\29\ The BLM
assesses acreage rent by applying the rate schedule, based on a survey
of values for pastureland from the National Agricultural Statistics
Service Cash Rents Survey to the number of acres that the ROW
authorizes for use. Capacity fees reflect the value of generating
electricity from solar and wind energy resources, which are quantified
by the number of megawatt hours of electricity produced on public
lands.\30\ Under the Geothermal Steam Act of 1970,\31\ geothermal
energy producers on federal lands pay royalties on electricity produced
and mineral byproducts derived from production along with rental fees
for the leased acreage. Unlike solar and wind energy revenues which are
not shared with states and counties, 50 percent of geothermal
development revenues are disbursed to the states and 25 percent of
revenues are disbursed to the counties where production occurs.\32\
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\28\ 43 U.S.C. 1761-1772.
\29\ Bureau of Land Management, Rights-of-Way, Leasing, and
Operations for Renewable Energy, 5,01,24, 89 FR 35634, https://
www.federalregister.gov/documents/2024/05/01/2024-08099/rights-of-way-
leasing-and-operations-for-renewable-energy
\30\ Id.
\31\ 30 U.S.C. 1004.
\32\ 30 U.S.C. 1019.
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H.R. 8954, the Public Lands Renewable Energy Development Act
(PLREDA), would establish a revenue sharing mechanism with renewable
energy producing states and counties while also supporting conservation
efforts to offset the footprint of renewable energy projects on federal
lands. Specifically, the bill would disseminate revenues for onshore
wind and solar production on federal lands according to the following
formula: 25% to the State hosting the production; 25% to the county
hosting the production; 25% to the Renewable Energy Resource
Conservation Fund (established by PLREDA to facilitate conservation,
habitat restoration, and outdoor access); and 25% to aid agencies in
the processing of renewable energy permits on federal lands.
IV. MAJOR PROVISIONS & ANALYSIS
Discussion Draft of H.R. ___ (Rep.), ``Comprehensive Offshore Resource
Evaluation Act'' or the ``CORE Act''
Enhances offshore resource assessments by mandating the
use of advanced data and modeling technologies.
Requires BOEM to analyze economic impacts and greenhouse
gas emission reductions of increased offshore energy
production.
Assesses the impact of withdrawals on oil and gas
exploration and production.
Analyzes existing and potential transboundary hydrocarbon
reservoirs.
Enhances cooperation and coordination with neighboring
countries.
Maintains incidental take regulations for geophysical and
geological surveys.
Authorizes geological and geophysical surveys in the Gulf
of Mexico.
Establishes expedited judicial review and enforcement
processes.
Requires monthly reporting on permit application
processing times.
H.R. 7053 (Rep. Thompson of PA), ``Orphan Well Grant Flexibility Act of
2024''
Amends the Orphaned Well Site Plugging, Remediation and
Restoration program in the IIJA by further clarifying that
pre and post environmental measuring is not mandatory.
Requires the NAS to evaluate the results of the program
with a specific focus on the impacts on economic
development, housing trends, and other potential benefits.
H.R. 8665 (Rep. Lucas), ``Supercritical Geothermal Research and
Development Act''
Establishes a program at DOE to focus on supercritical
geothermal research and provides grant opportunities for
supercritical geothermal technologies.
Requires DOE and DOI to enter a MOU on geothermal data
collection and analysis.
Directs USGS to update its national geothermal resource
assessment within 180 days of enactment.
Orders DOI, in consultation with DOE, to commission the
drilling of exploration boreholes deeper than 8 kilometers
to provide control points for supercritical heat mapping
and geothermal development.
Authorizes $5 million for each of fiscal years 2026
through 2030.
H.R. 8954 (Rep. Gosar), ``Public Lands Renewable Energy Development Act
of 2024''
Creates a revenue sharing mechanism for wind and solar
energy on public lands (25% to the State hosting the
production; 25% to the county hosting the production; 25%
to the Renewable Energy Resource Conservation Fund; and 25%
to aid agencies in the processing of renewable energy
permits on federal lands).
Establishes a Renewable Energy Resource Conservation Fund
to restore and protect landscapes in regions where
renewable energy development occurs.
V. COST
The Congressional Budget Office has not scored any of these bills.
VI. ADMINISTRATIVE POSITION
Unknown.
VII. EFFECT ON CURRENT LAW (RAMSEYER)
Discussion Draft of ``The CORE Act''
https://naturalresources.house.gov/uploadedfiles/bill-to-
law_discussion_draft_of_h.r.______rep._hunt.pdf
H.R. 7053
https://naturalresources.house.gov/uploadedfiles/bill-to-
law_118hr7053ih.pdf
H.R. 8665
https://naturalresources.house.gov/uploadedfiles/bill-to-
law_h.r._8665.pdf
LEGISLATIVE HEARING ON DISCUSSION DRAFT OF H.R. ____, TO AMEND THE
ENERGY POLICY ACT OF 2005 TO IMPROVE THE COMPREHENSIVE INVENTORY OF
OUTER CONTINENTAL SHELF OIL AND NATURAL GAS RESOURCES, AND FOR OTHER
PURPOSES, ``COMPREHENSIVE OFFSHORE RESOURCE EVALUATION ACT'', OR ``CORE
ACT''; H.R. 7053, TO AMEND THE ENERGY POLICY ACT OF 2005 TO ADDRESS
MEASURING METHANE EMISSIONS, AND FOR OTHER PURPOSES, ``ORPHAN WELL
GRANT FLEXIBILITY ACT OF 2024''; H.R. 8665, TO AMEND THE ENERGY
INDEPENDENCE AND SECURITY ACT OF 2007 TO DIRECT RESEARCH, DEVELOPMENT,
DEMONSTRATION, AND COMMERCIAL APPLICATION ACTIVITIES IN SUPPORT OF
SUPERCRITICAL GEOTHERMAL AND CLOSED-LOOP GEOTHERMAL SYSTEMS IN
SUPERCRITICAL VARIOUS CONDITIONS, AND FOR OTHER PURPOSES,
``SUPERCRITICAL GEOTHERMAL RESEARCH AND DEVELOPMENT ACT''; AND H.R.
8954, TO PROMOTE THE DEVELOPMENT OF RENEWABLE ENERGY ON PUBLIC LANDS,
AND FOR OTHER PURPOSES, ``PUBLIC LAND RENEWABLE ENERGY DEVELOPMENT ACT
OF 2024''
----------
Tuesday, July 23, 2024
U.S. House of Representatives
Subcommittee on Energy and Mineral Resources
Committee on Natural Resources
Washington, DC
----------
The Subcommittee met, pursuant to notice, at 11:17 a.m. in
Room 1334, Longworth House Office Building, Hon. Pete Stauber
[Chairman of the Subcommittee] presiding.
Present: Representatives Stauber, Gosar, Graves, Fulcher,
Tiffany, Hunt, Westerman; Ocasio-Cortez, and Kamlager-Dove.
Also present: Representatives Carl, Lucas, Thompson of
Pennsylvania; and Levin.
Mr. Stauber. The Subcommittee on Energy and Mineral
Resources will come to order.
Without objection, the Chair is authorized to declare a
recess of the Subcommittee at any time.
Under Committee Rule 4(f), any oral opening statements at
hearings are limited to the Chairman and the Ranking Minority
Member.
I ask unanimous consent that the gentleman from California,
Mr. Levin; the gentleman from Alabama, Mr. Carl; the gentleman
from Pennsylvania, Mr. Thompson; and the gentleman from
Oklahoma, Mr. Lucas, be allowed to participate in today's
hearing.
Without objection, so ordered.
I now recognize myself for an opening statement.
STATEMENT OF THE HON. PETE STAUBER, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF MINNESOTA
Mr. Stauber. I want to thank you all for being here today
to discuss these important pieces of legislation.
The bills we have before us today would continue building
on our commitment to an all-of-the-above energy approach, while
also reining in executive action that defies logic as well as
law.
H.R. 7053, the Orphan Well Grant Flexibility Act of 2024,
introduced by Representative Thompson from Pennsylvania, would
further clarify language from the IIJA on orphan well plugging.
There are thousands of orphan wells across the country, most of
which are on state and private lands, and are legacy wells that
were drilled before state and Federal regulatory statutes were
put in place to ensure good practice. The IIJA included
bipartisan language to provide the Federal Government, tribes,
and states with money to plug these wells. Specifically, states
were provided nearly $4.3 billion out of the total $4.7 billion
included for remediation efforts.
Most states with orphaned wells already have programs to
plug and remediate these wells, and do great work in doing so.
Unfortunately, the Department of the Interior has fumbled
management of the state program. In the Department's formula
grant guidance, they included requirements for states to
conduct pre and post-plugging groundwater and methane
monitoring on each orphaned well, even though the law very
clearly states that those actions are optional, and that
funding ``may'' be used for these purposes. The practical
implications of these requirements are devastating. And not
only have these requirements resulted in fewer wells being
plugged and reclaimed, but they have also dissuaded states from
applying for the funding entirely.
I look forward to examining these decisions today, and
again appreciate the gentleman from Pennsylvania for taking the
lead on this bill to right this wrong.
H.R. 8954, the Public Land Renewable Energy Development Act
of 2024, would simply ensure that states and counties receive
the benefits of revenue sharing from solar and wind energy
projects on Federal lands within their borders. The bill would
provide 25 percent of the revenues from these projects to host
states, 25 percent to host counties, 25 percent to the BLM to
facilitate processing renewable energy permits, and 25 percent
to a newly-created Renewable Energy Conservation Fund to offset
the impacts of renewable energy on Federal lands and wildlife.
This would ensure that renewable energy production on Federal
lands contributes to local communities and states like oil and
gas development does.
H.R. 8665, introduced by Congressman Lucas, would require
the Department of the Interior and the Department of Energy to
enter into an MOU on geothermal data collection and analysis.
The bill would also require the U.S. Geological Survey to
update its National Geothermal Resource Assessment, and
commission the drilling of exploration boreholes to provide
control points for supercritical heat mapping for geothermal
development.
Lastly, Representative Hunt's discussion draft, the CORE
Act, would enhance and modernize our nation's resource
assessment process for offshore oil and gas exploration. The
United States is endowed with vast offshore energy reserves,
yet our current methodologies fall short of providing the
precision and reliability necessary for informed decision
making. The CORE Act addresses these deficiencies by
instructing acquisition of advanced geological and geophysical
data, and incorporating the latest resource evaluation
technologies to ensure that our resource estimates are both
accurate and comprehensive.
The bill also is necessary. It details economic and
alternative energy impact analysis, ensuring that we understand
the full implications of resource development. These
enhancements will ensure that the Bureau of Ocean Energy
Management's resource assessments are thorough and include the
best available information, reducing uncertainty and providing
benefits to taxpayers and coastal communities. The provisions
within this bill will also streamline the geophysical and
geotechnical permitting process, the linchpin of offshore
exploration and a prerequisite to performing these analyses.
It is imperative that we act now to solidify our leadership
in offshore energy development and secure a sustainable
offshore energy future for the United States.
I look forward to hearing from our witnesses on these
bills, and will now yield to the Ranking Member for her opening
statement.
STATEMENT OF THE HON. ALEXANDRIA OCASIO-CORTEZ, A
REPRESENTATIVE IN CONGRESS FROM THE STATE OF NEW YORK
Ms. Ocasio-Cortez. Thank you, Chair Stauber.
As we all have experienced, this summer has been the
hottest ever recorded in Washington, DC. The same is true
across many of our districts. Climate change is here, and it is
putting Americans' lives in danger. But we do not have to
accept an unlivable planet. As policymakers, we have the power
and responsibility to act. The bills we are considering today
are steps towards different futures, some brighter, some
darker.
H.R. 8665, Mr. Lucas' Supercritical Geothermal Research and
Development Act, presents one important move towards a clean
energy future. Supercritical geothermal is a recent innovation
that unlocks massive potential to produce reliable, always
available clean energy using the heat from the Earth's core.
H.R. 8665 supports much-needed research at the Departments of
Energy and the Interior to catalyze the deployment of these
experimental forms of geothermal.
H.R. 8954, the Public Land Renewable Energy Development
Act, or PLREDA, would support solar and wind development on
public lands. As we make the necessary transition from fossil
fuels to renewable energy, we can't leave the counties and
states that rely on oil and gas revenue high and dry. This bill
would establish a much-needed mechanism to share renewable
energy revenues with local communities, similar to oil and gas.
While I fully support renewables revenue sharing, we can
and should go further. Mr. Levin recently introduced a more
comprehensive version of the Public Lands Renewable Energy Act,
H.R. 9012, reflecting a wider range of renewable energy
incentives that industry and environmental groups have been
advocating for years. As we move towards marking up PLREDA, I
hope we can work together across the aisle to incorporate these
incentives for rapid renewable development from Mr. Levin's
bill.
Mr. Hunt's discussion draft, the Comprehensive Offshore
Resource Evaluation Act, would take us in the wrong direction.
Although my colleagues across the aisle often mention an all-
of-the-above energy approach, this bill is oil and gas above
all. The discussion draft before us today further skews the
Federal offshore oil and gas program towards development. Who
does this help? It is clear that big oil is the only winner.
The United States is currently producing more oil and gas
than any nation in history, and is the No. 1 exporter of oil
and gas in the world. But Americans aren't seeing any of the
promised benefits of this so-called energy dominance. Prices
are still high, and communities are still paying the costs of
increased pollution and an increasingly unlivable climate.
Meanwhile, big oil has been accused by the FTC in multiple
class action lawsuits of illegally colluding with the global
oil cartel to keep prices and their profits high while
Americans suffer soaring costs of living.
However, this draft bill only calls for increased
exploration for offshore oil and gas and skewed studies that
downplay all the public health and environmental costs the
American public pays for oil and gas development. This draft
even strips protections for wildlife against deafening air gun
blasting, potentially putting the critically endangered Rice's
whale on a path to extinction.
And the final bill on today's docket, H.R. 7053, highlights
one of the immense liabilities Big Oil has for the public:
orphaned wells. Wells abandoned by the oil and gas industry
without money to clean them up are a liability for the taxpayer
and a public health risk to communities that live nearby.
Democrats won billions of dollars in the Infrastructure
Investment and Jobs Act to clean up orphaned wells across the
country, but H.R. 7053 would make emissions testing optional
and eliminate other grant requirements such as prioritizing
plugging wells within half a mile of low-income Black and
Indigenous communities. Eliminating these requirements
altogether would cost essential emissions data and endanger
communities already most at risk of health impacts.
I hope we can work together to use funds as efficiently as
possible to plug as many wells as we can without sacrificing
communities.
I look forward to today's discussion, and I yield back.
Mr. Stauber. Thank you very much. I will now begin our
Member panel, who will speak on their legislation, and I will
recognize Mr. Paul Gosar from Arizona's 9th Congressional
District for his testimony on his bill.
Mr. Gosar.
STATEMENT OF THE HON. PAUL GOSAR, A REPRESENTATIVE IN CONGRESS
FROM THE STATE OF ARIZONA
Dr. Gosar. Thank you, Mr. Chairman Stauber.
I introduced the first version of the Public Land Renewable
Energy Development Act, or PLREDA, in 2012 to ensure that the
emerging renewable energy technologies were treated similarly
to other types of energy projects operating on Federal lands.
Over the years, the bill has morphed as these technologies have
become more mainstream, while pieces of the bill have passed
over the years, and some pieces have become unnecessary.
One aspect of the bill that has remained is in regard to
dispensation of revenue. Currently, solar and wind developers
on Federal lands pay rental fees and royalties in the form of
capacity fees. All the revenue from these payments goes to the
Treasury. Now, this differs from the revenue generated by other
energy sources on Federal lands, including oil and gas and
geothermal, which are shared with states and local governments.
This bill would ensure that the same is true for wind and
solar.
The bill would provide 25 percent of the revenues go to the
host county, 25 percent of the revenues go to the host state,
25 percent go to the BLM to improve their permitting process
procedures, and 25 percent to a newly-created Renewable Energy
Conservation Fund to offset the impacts of renewable energy
production on Federal lands. This funding will allow rural and
Western communities to benefit from energy production on
Federal lands to support essential services.
While I recognize that permitting of energy projects on the
Federal lands is a serious problem, I believe robust permitting
reform language should be addressed in ways that will help all
energy sources.
I want to thank the American Clean Power Association for
testifying and am looking forward to working with my colleagues
on this bill moving forward.
With that, I yield back.
Mr. Stauber. I thank you very much. We have one more
individual who wants to testify, and it is Mr. Wesley Hunt from
Texas. He is on his way. I am trying to get to see how far he
is, because I don't want to wait too long.
OK, we are going to start, and when Mr. Hunt comes in, at
the nearest break, we will allow him to speak on his bill. We
will now introduce our second panel of witnesses.
Let me remind the witnesses that under Committee Rules,
they must limit their oral statements to 5 minutes, but their
entire statement will appear in the hearing record.
To begin your testimony, please press the ``talk'' button
on the microphone.
We use timing lights. When you begin, the light will turn
green. When you have 1 minute remaining, the light will turn
yellow. And at the end of the 5 minutes, the light will turn
red, and I will ask you to please complete your statement.
I will also allow all witnesses to testify before Member
questioning.
Our first witness is Mr. Dustin Van Liew. He is the Vice
President of EnerGeo Alliance, and he is stationed in Houston,
Texas.
Mr. Van Liew, you are now recognized for 5 minutes.
STATEMENT OF DUSTIN VAN LIEW, VICE PRESIDENT, ENERGEO ALLIANCE,
HOUSTON, TEXAS
Mr. Van Liew. Thank you, Chairman, Ranking Member, and
members of the Subcommittee. I appreciate the opportunity to
testify today. As was introduced, I am Dustin Van Liew, Vice
President of Global Policy and Government Affairs for the
EnerGeo Alliance. I spearhead our policy efforts here and
internationally.
EnerGeo members are the geoscience companies and energy
developers that use Earth science to discover, develop, and
deliver energy to the world. Our members operate in the United
States across the Outer Continental Shelf and extensively in
the Gulf of Mexico. EnerGeo commends Congressman Hunt for his
leadership authoring the Comprehensive Offshore Resources
Evaluation Act, or CORE Act, and we strongly support the
legislation.
But first let me provide some context. Exploration is
critical for ensuring global access to energy. Total energy use
is estimated to increase 34 percent to support a world
population of 10 billion by 2050. Even with high growth
expected in alternative energy, by 2050 we will need to
discover about 17.56 billion barrels to meet global energy
demand. In contrast, last year we discovered about 5 billion
barrels globally, with eight discoveries in the Gulf of Mexico.
By 2050, about half of the expected global oil supply will come
from fields and projects that are not in production today.
Global industry investments are influenced by where it can
acquire geoscience data through supportive policy structures.
BOEM, however, last updated its reserves report in 2019, and
there is a lack of updated reserves information for the Gulf of
Mexico, Alaska, and the Atlantic. The CORE Act would rectify
this.
Seismic and geoscience surveying is well understood and
safe. Tens of thousands of surveys have occurred throughout the
world over the last 60 years using conventional compressed air
arrays. After covering millions of kilometers, there is no
credible scientific evidence that sound from geoscience surveys
has had any significant impacts on marine life, populations, or
the marine environment.
Unfortunately, geoscience permitting is too often stalled
within regulatory agencies or impeded by extreme environmental
organizations exploiting existing regulatory and litigation
processes. The CORE Act will advance responsible and
sustainable exploration and production.
Sections 1, 2, 3, and 5, as a whole, provide clarity and
helpful actions that will support the nation's energy goals.
Section 4, in particular, removes onerous procedural roadblocks
and litigious obstacles that hinder domestic energy security.
History has shown that the 5-year period effectiveness for
ITRs is counterproductive, creates an inefficient permitting
process, and leads to repetitive lawsuits by advocacy
organizations only seeking to halt energy development. Indeed,
many meritless lawsuits have been filed over two decades
challenging Alaska North Slope ITRs. Section 4(a) resolves
these issues by eliminating the 5-year expiration date and
tedious ITR renewal process. The ITR governing incidental take
for marine mammals on geoscience surveys in the GOM is a prime
example showing why NMFS lacks the capacity and ability to
issue ITRs every 5 years.
The original ITR petition for the GOM was submitted 22
years ago. NMFS at the time and BOEM since have submitted
revised petitions in 2004, 2011, and 2016 to account for
updated information that had accumulated while NMFS lacked the
resources to take action on the petitions. NMFS eventually
issued the final rule in 2021, only to be reassessed to correct
math errors, and finally issued the revised ITR this year with
the same mitigation and monitoring requirements included in
2021.
Even after the ITRs are issued, the current regulatory
framework requires NMFS to jump through additional procedural
hoops to issue letters of authorization before geoscience
activities can proceed. Subsection 4(c) seeks to streamline
this onerous process, and offers a pragmatic approach that both
conserves agency resources and maintains the integrity of the
mitigation requirements to comply with the MMPA and the
Endangered Species Act. Further, Subsection 4(c) provides a
clear timetable for surveys to proceed under BOEM permits,
while still complying with most all the existing mitigation
requirements in the GOM.
We strongly support the proposed legislation to ensure U.S.
energy supplies are rigorously assessed with a more efficient
and predictable permitting process. Likewise, reducing the
ability of outside special interest groups to obstruct energy
geoscience exploration is a necessary step to ensure continued
development of energy resources and low carbon solutions for
future generations.
I appreciate the opportunity to testify today.
[The prepared statement of Mr. Van Liew follows:]
Prepared Statement of Dustin Van Liew, On Behalf of the EnerGeo
Alliance
on ``Comprehensive Offshore Resource Evaluation Act (CORE Act)''
Chairman Stauber, Ranking Member Ocasio-Cortez, and Members of the
Subcommittee:
For the record, my name is Dustin Van Liew, and I am the Vice
President of Global Policy & Government Affairs at EnerGeo Alliance. I
spearhead EnerGeo's legislative and regulatory engagement efforts at
national and international levels. Our membership base includes 60
companies spanning 50 countries. EnerGeo's mission is to advance the
energy geoscience and exploration industry through global governmental,
regulatory, and legal advocacy, communications, environmental and
scientific research, and standard development. We aim to drive
excellence in health, safety, environmental performance, and
sustainability.
I joined EnerGeo (then IAGC) in 2015 and have extensive experience
and background in policy and government affairs. Before joining
EnerGeo, I served as the Executive Director for the Public Lands
Council and National Cattlemen's Beef Association--Federal Lands. Since
2014, I have served as Board Member of the Western Resources Legal
Center, having recently served as Board Chair from 2018 to 2023. I am
well-versed in navigating the challenges that face natural resources-
based industries and am a leading authority on public and government
lands and international natural resource policy issues.
I present this testimony as Vice President of Global Policy &
Government Affairs at EnerGeo Alliance. Founded in 1971, EnerGeo is the
non-profit global trade alliance for the energy geoscience and
exploration industry. EnerGeo member companies include onshore and
offshore geoscience survey operators and acquisition companies, energy
data and processing providers, energy exploration and development
companies, equipment and software manufacturers, industry suppliers,
service providers, and consultancies. EnerGeo advocates for connecting
more people and communities with access to energy around the world--by
communicating factually, securing science-based policies, and promoting
the geoscience companies, innovators and energy developers that use
earth science to discover, develop and deliver energy, sustainably, to
our world. Together, we are Making Energy Possible.
Many EnerGeo member companies operate in the U.S., both onshore and
offshore across the Outer Continental Shelf (OCS), and extensively
within the Gulf of Mexico (GOM). These companies play an integral role
in the successful exploration and development of offshore hydrocarbon,
wind, and low-carbon solutions such as carbon capture and storage (CCS)
resources through the acquisition and processing of geophysical and
geological data.
Through reliable science- and data-based regulatory advocacy,
credible resources and expertise, and future-focused leadership,
EnerGeo continuously works to develop and promote informed government
policies that advance responsible energy exploration, production, and
operations. As the U.S. and global energy demand evolves, we believe
that all policymakers and energy companies pursuing mainstay,
alternative, and low-carbon solutions should have access to reliable
data and analysis to support their forward-moving efforts.
At EnerGeo, we are proud of our unique collaborations among
industry, scientists, and governments to support sustainable energy
access. In the U.S., this includes EnerGeo's Gulf of Mexico Proactive
Regulatory Observational Program (GOM-PROP) to provide a self-
sustaining structure for the continued successful implementation of,
and compliance with, both present and future Incidental Take
Regulations (ITRs) applicable to geoscience surveys in the Gulf of
Mexico, and to provide comprehensive marine mammal monitoring data.
Energy Demand: The global economy and oil demand are set to achieve
consecutive record highs in 2024 and 2025, alongside record lows in oil
intensity and consecutive global oil supply records, per U.S. Energy
Information Administration (EIA) projections.
Natural gas experienced record-breaking global demand, production,
and consumption levels in 2023--and these records are expected to be
broken again this year and in 2025 per the International Energy Agency
(IEA).
Global natural gas demand is also predicted to reach record highs
in 2024 and 2025 with natural gas remaining an integral and competitive
source for global electricity generation, heating, cooking, and
industrial demands, as well as environmental progress.\1\
---------------------------------------------------------------------------
\1\ TXOGA Quarterly Energy Economics Outlook
---------------------------------------------------------------------------
Exploration will continue to play a critical role in ensuring
global access to energy in the future and now in the midst of the
energy evolution. By 2050, the world population is estimated to
increase to almost 9.8 billion.\2\ Total energy use is expected to
increase 34%, with an expected steady growth in mainstay sources of
energy (petroleum and natural gas constituting 50%) and faster growth
anticipated in all other sources.\3\ In this scenario, exploration will
be critical for the energy evolution. While about 5 billion barrels of
oil were discovered in 2023, by 2050 we will need to discover 17.56
billion barrels per year to match the global energy demand.\4\
---------------------------------------------------------------------------
\2\ Source: 2023 Population Data Sheet https://www.prb.org/wp-
content/uploads/2023/12/2023-World-Population-Data-Sheet-Booklet.pdf
\3\ Source: EIA International Energy Outlook--October 2023 https://
www.eia.gov/outlooks/ieo/
\4\ Source: RystadEnergy UCube; Rystad Energy U.CubeExploration;
Rystad Energy research and analysis
---------------------------------------------------------------------------
Although the U.S. has been blessed with energy abundance, roughly
10% of the world does not have reliable access to electricity.
According to the Rockefeller Foundation, more than 840 million people
lack access to electricity and over 3 billion people currently live in
countries with per capita energy consumption below the Modern Energy
Minimum--1,000kwh per year. Together, it is estimated that over 3.5
billion people do not have reasonably reliable access to electricity,
meaning that they spend more than 56 days per year without power.\5\
---------------------------------------------------------------------------
\5\ John Ayaburi, Morgan Bazilian, Jacob Kincer, Todd Moss,
Measuring ``Reasonably Reliable'' access to electricity services, The
Electricity Journal, Volume 33, Issue 7, 2020, 106828, ISSN 1040-6190,
https://doi.org/10.1016/j.tej.2020.106828.
---------------------------------------------------------------------------
Currently, 30% of the world does not have access to clean fuels for
cooking. Cooking with kerosene, coal, or biomass is directly linked to
over 3 million premature deaths per year with women and children
disproportionately impacted.\6\ Removing access to unfavored energy
sources has disproportionate impacts on marginalized populations.
---------------------------------------------------------------------------
\6\ World Health Organization, ``Household air pollution'', https:/
/www.who.int/news-room/fact-sheets/detail/household-air-pollution-and-
health#::text=Each%20year%2C%203.2%20million%20
people,air%20pollution%20data%20for%20details)
---------------------------------------------------------------------------
Populations around the world will need greater access to reliable
and affordable energy to not only thrive, but for the movement of goods
and people and for climate resilience, providing the necessary
feedstock for fertilization, refrigeration for foods and medicine,
irrigation, heating and cooling, and more. As a top priority of U.N.
Sustainable Development Goals, we need all sources of energy at the
table, to meet skyrocketing demand for energy security and energy
accessibility.
While we are at the start of what is being called an
``international upcycle,'' where the industry invests now will be
influenced by where it has access to insight through geoscience data,
infrastructure, and supportive regulatory and policy structures.
Unfortunately, the United States is falling behind due to unnecessary
bureaucratic delays and shortsighted policies that elevate certain
forms of energy over others.
Our Surveys: Meeting growing demand for energy that is more
accessible, affordable, reliable, and cleaner will require greater
collaboration and geoscience-driven energy policies. The reality is, no
matter the preferred or prioritized energy source, virtually all
sources of energy needed to support the world's energy evolution
require ``eyes'' on something going in, out, or through the ground.
That sight is only made possible through the innovation and insight of
the energy geoscience industry.
Mainstay energy sources such as petroleum and natural gas, and the
lower carbon energy solutions such as offshore and onshore wind, depend
on geoscience. Similarly, carbon capture, utilization, and storage
projects are simply not possible without geoscience surveys to ensure
that those projects are properly sited, designed, and managed. Energy
literally starts with the geoscience industry.
By providing invaluable information about the resources beneath us,
energy companies and policymakers can identify and prioritize high-
density, lower-carbon-intensive energy sources, locate where offshore
wind facilities are best suited for harnessing the energy from wind,
prolong the life of existing natural gas and petroleum assets, make it
possible to store carbon beneath the surface, and more.
As nations develop and implement their energy evolution goals to
make reliable, affordable energy available to their citizens and meet
Net Zero Emissions (NZE) policy ambitions, it is essential to
understand that those goals cannot and will not be realized without the
critical data and technology the geoscience industry provides.
Even though, by current market cap, geosciences are a small part of
the energy supply chain, when it comes to whether energy can be
accessed in any given region, we are the first and most pivotal part.
Resource Evaluation in the United States
The only viable process for the U.S. Government to understand the
country's resource potential is through geoscience surveys conducted by
advanced technology companies like those that comprise EnerGeo's
membership. According to the Bureau of Ocean Energy Management's (BOEM)
website, regarding resource evaluation, ``Every five years BOEM
provides a comprehensive assessment of undiscovered oil and gas
resources on the OCS. The results are presented as both Undiscovered
Technically Recoverable Resources (UTRR) and Undiscovered Economically
Recoverable Resources (UERR). The assessment utilizes a geologic play-
based approach that incorporates a complete analysis of geologic and
petroleum system elements for the UTRR, and an assessment of
engineering and economic considerations for the calculation of the
UERR. DOI has released an Assessment of Undiscovered Oil and Gas
Resources on the US OCS regularly since 1975.''
This information is not possible and would not be available to
policymakers and U.S. citizens without the geoscience industry
conducting surveys. By conducting surveys that image the subsurface
below the ocean floor, geoscience surveys provide the information
governments and policymakers need to make informed decisions in the
best interest of their citizens regarding accessing and developing
energy sources of all types, as well as developing low-carbon
strategies.
Based on information compiled by the subcommittee, BOEM last
updated its reserves report in December 2019, with their 2023
Comprehensive Inventory still relying on this outdated data for Gulf of
Mexico. Notably, there is a lack of reserves information for Alaska and
the Atlantic on their website.
Seismic and geoscience surveying is a well-understood and safe
industry practice, and informed policy decisions regarding offshore
energy development of any type can only be made with the evaluation
provided by modern seismic survey technology. In the more than 60 years
of geoscience surveys in the Gulf of Mexico, there has not been a
single reported incidence of sound from survey operations injuring
marine life. Tens of thousands of offshore geoscience surveys have
occurred throughout the world over the last 60 years using conventional
compressed-air arrays. In all that time, and across millions of
kilometres, there is no credible scientific evidence that sound from
geoscience surveys has had any significant impacts on marine life
populations or the marine environment.
Unfortunately, the permitting of this activity, critical to
identifying the nation's energy supplies, is too often stalled within
regulatory agencies without accountable deadlines or timelines for
review, or impeded by extreme environmental advocacy organizations
exploiting existing regulatory and litigation processes.
Policy Challenges
Because the energy geoscience industry provides access to develop
energy through its imaging, it is very often the first presence of
energy development or exploration in a geographic area. As a result,
our members often encounter obstacles and opposition to their
operations that are aimed at preventing the development of a certain
energy source--whether that's petroleum, natural gas, or even wind.
In some regions, extreme environmental advocacy groups prioritize
preventing any energy geoscience surveys from occurring and even label
geoscience research as ``the gateway drug to oil and gas.''
Policymakers and energy companies consequently are unable to access
important data needed to make informed decisions about future energy
development.
This has led to increased regulatory scrutiny and misinformation
about what geoscience research is and its impacts in frontier areas and
even in mature basins. Recent eNGO advocacy focuses on geoscience as
the linchpin to not only exploration but also increasing production in
mature basins includes the Gulf of Mexico.\7\ This short-sighted
advocacy ignores both the undisputed energy needs of the world and the
fact that geoscience surveys allow for the identification of both the
presence and absence of energy sources and, thus, more efficient and
less-impactful development.
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\7\ https://www.nrdc.org/stories/offshore-drilling-
101#environmental
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In order to stimulate new geoscience activity, policymakers must
prioritize geoscience-driven energy policies and regulatory frameworks
that remove uncertainty and delay, promote timely permitting decisions,
and support a quick pace of return on investment. Regulations should
provide predictability, promote competition, and provide fiscal
certainty, through risk-and science-based processes.
BOEM Permitting & NMFS Authorization Delays
In the Outer Continental Shelf Lands Act (OCSLA), Congress
expressly mandated the ``expeditious and orderly development'' of the
Outer Continental Shelf (OCS) ``subject to environmental safeguards.''
43 U.S.C. Sec. 1332(3). Courts have confirmed that ``the expeditious
development of OCS resources'' is OCSLA's primary purpose. California
v. Watt, 668 F.2d 1290, 1316 (D.C. Cir. 1981). Congress enacted OCSLA
to ``achieve national economic and energy policy goals, assure national
security, reduce dependence on foreign sources, and maintain a
favorable balance of payments in world trade.'' 43 U.S.C. Sec. 1802(1).
Congress expressly intended to ``make [OCS] resources available to meet
the Nation's energy needs as rapidly as possible.'' Id.
Sec. 1802(2)(A).
Geoscience surveying has been and continues to be essential to
achieving OCSLA's requirements because it is the only feasible
technology available to accurately image the subsurface of the OCS
before a single well is drilled or a single energy source is developed.
Offshore geoscience surveys require authorizations from BOEM,
pursuant to OCSLA. See id. Sec. 1340. There is no requirement for an
applicant for an offshore survey permit under OCSLA to obtain an
incidental take authorization under the Marine Mammal Protection Act
(MMPA). However, unlawful ``takes'' of marine mammals incidental to
lawful activities (such as a permitted offshore seismic survey) may
nevertheless be subject to MMPA-based penalties. See 16 U.S.C.
Sec. 1375. Accordingly, many applicants for offshore survey permits
from BOEM also request incidental (i.e., unintentional) take
authorization under the MMPA from the National Marine Fisheries Service
(NMFS) and/or the U.S. Fish and Wildlife Service (FWS).\8\
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\8\ FWS has jurisdiction over polar bears, walrus, sea otters,
dugongs, and manatees. NMFS has jurisdiction over all other marine
mammals.
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In this context, it is important to recognize that the permit
issued by BOEM authorizes the seismic survey and the MMPA authorization
narrowly addresses the incidental take associated with the seismic
survey. NMFS and FWS do not have jurisdiction over the survey; their
authority under the MMPA extends only to the authorization of
incidental take. Notwithstanding the limited role of FWS and NMFS, MMPA
authorizations are often the primary cause of administrative delay in
the offshore geoscience survey permitting process.
In the past decade, these problems have manifested in routinely
delayed permitting processes, inconsistent and misguided analyses of
potential impacts, and opportunistic advocacy litigation intended to
block or impede offshore development.
For example, in the Gulf of Mexico, BOEM requires an MMPA
authorization from NMFS prior to the issuance of a geoscience permit
under the current ITR. During the rulemaking process, industry pointed
out mathematical errors in the ITR that was originally promulgated
January 2021. As discussed further below, it took BOEM and NMFS an
additional three years to re-evaluate the original analysis before NMFS
amended the ITR in 2024, ultimately making few changes. This revision
process was just one of many delays in the history of the GOM ITR that
contributed to the steady decline of geoscience surveys mapping the
Gulf of Mexico since at least 2014.
In Alaska, unnecessary and unexplained delays in processing MMPA
authorizations prevent planned geoscience surveys from providing the
timely insight that would update resource estimates. Currently, at
least one petition for MMPA authorization has stalled for more than two
years preventing updated insight into the resource potential on
Alaska's North Slope.
In the Atlantic, approximately 30 years have passed since the
potential hydrocarbon resource base has been assessed with seismic
surveys. In the meantime, seismic surveys for ``scientific research''
have been conducted fairly regularly in the Atlantic OCS, in addition
to other geophysical surveys used to characterize the seabed and
subsurface for suitability of offshore wind energy facilities. Six
companies applied to BOEM for permits to conduct seismic surveying in
the Atlantic OCS--a process that started in 2011, when the first permit
application was filed, and ultimately ended in 2018 after nearly six
years of working to obtain MMPA authorizations from NMFS.
Support for Proposed Language
In general, EnerGeo believes that the CORE Act as drafted will
advance responsible and sustainable energy exploration and production.
Sections 1, 2, 3, and 5, as a whole, provide clarity and helpful action
items that will support the nation's energy goals. Section 4, in
particular, removes onerous procedural roadblocks and litigious
obstacles that hinder domestic energy security goals. Without a more
efficient regulatory framework in place to support geoscience surveys,
the country will not be able to keep up with the increased demand for
reliable energy.
Subsections 4(a) and 4(b)
History has shown that a five-year period of effectiveness for ITRs
is counterproductive, creates an inefficient permitting process, and
leads to repetitive lawsuits by advocacy organization seeking to halt
energy development. Subsection 4(a) resolves these issues by
eliminating the five-year expiration date and unnecessarily tedious ITR
renewal process.
The ITR governing the incidental take of marine mammals in GOM
associated with offshore geoscience surveys is a prime example showing
why NMFS lacks the capacity and ability to timely issue ITRs every five
years.\9\ The original petition to initiate the rulemaking process for
the GOM ITR was submitted 22 years ago by the Minerals Management
Service (MMS), an agency that no longer exists and was reorganized to
now-BOEM and the Bureau of Safety and Environmental Enforcement. MMS/
BOEM had to submit three revised petitions in 2004, 2011, and 2016 to
account for updated information and analyses that had accumulated while
NMFS lacked the resources to take meaningful action on the petitions.
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\9\ See BOEM Request to the National Oceanic and Atmospheric
Administration for Incidental Take Regulations Governing Geophysical
Surveys on the Outer Continental Shelf of the Gulf of Mexico at 5 (Oct.
14, 2016), available at https://media.fisheries.noaa.gov/dam-migration/
boem_2016rule_app_opr1.pdf.
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NMFS eventually issued a final rule in 2021 in response to BOEM's
2016 revised petition. But that final agency action was short-lived, as
the 2021 final rule was reassessed to correct certain mathematical
errors, as described above. Over the course of three years, NMFS
considered and incorporated newly available information and issued the
2024 final rule, affirming the same regulations, mitigation,
monitoring, and reporting requirements promulgated pursuant to the 2021
final rule. The timeline leading up to the current GOM ITR therefore
provides little assurance that NMFS is capable of issuing ITRs every
five years. A better approach would be to eliminate the arbitrary five-
year limit on ITRs and to instead allow for the targeted amendment of
ITRs, as necessary, to update mitigation measures or other findings,
based on the best available scientific information.
Eliminating the arbitrary five-year limit will also help to
decrease opportunities for advocacy groups to challenge ITRs in
misguided attempts to prevent U.S. energy development. Indeed, numerous
meritless lawsuits have been filed over two decades challenging ITRs
applicable to Alaska North Slope oil and gas activities--wasting the
resources of federal agencies and the courts. Again, new agency
actions, which can be challenged in court, should only occur if there
is a substantive need--not based on an arbitrary five-year termination
period for what may be an otherwise valid ITR.
For the same reasons stated above, EnerGeo similarly supports the
language of subsection 4(b), which applies the logic described in
Subsection 4(a) and prevents the existing GOM ITR from expiring on
April 19, 2026. By prolonging the period of effectiveness, the
geoscience and exploration industry can continue to make long-term
plans for meaningful geoscience surveys that will inform forward-
looking policies and help diversify energy sources.
Subsection 4(c)
Even after ITRs are issued, the current regulatory framework
requires NMFS to jump through an additional procedural hoop and issue
Letters of Authorizations (LOAs) to survey operators before they can
move forward with the geoscience activities described and analyzed in
their respective ITRs. Subsection 4(c) seeks to streamline this onerous
procedural process and offers a more pragmatic and beneficial approach
that both conserves agency resources and maintains the integrity of the
substantive mitigation and monitoring requirements to remain in
compliance with the MMPA and the Endangered Species Act.
For example, after the 2021 ITR was issued for geoscience
activities in GOM, NMFS incurred a significant backlog of applications
for LOAs. The delays in permitting continued to snowball when the 2021
ITR was revised and reissued in 2024 to fix agency mathematical errors.
Although NMFS has recently been more expedient in approving LOA
applications, history shows that the LOA approval process is unduly
time consuming and detrimental to the timely conduct of otherwise-
lawful geoscience activities.
Subsection 4(c) simply relieves an administrative burden and
provides a clear and predictable timetable for surveys to proceed under
BOEM permits without the delay caused by waiting for an untimely LOA.
There would be no significant change in protection as a result of this
modification because operators would still be required to comply with
almost all of the existing mitigation and monitoring measures
prescribed in the GOM ITR.
Conclusion
The energy geoscience industry is in the business of minimizing the
footprint of energy activity by pinpointing where the resource is and
importantly where it is not. Armed with reliable data and analysis,
companies and policymakers are able to identify and prioritize high-
density, low-carbon-intensive energy sources closer to existing
infrastructure and the end user, locating where offshore wind
facilities are best suited for harnessing the energy from wind,
prolonging the life of existing natural gas and petroleum assets, and
making it possible to store carbon beneath the surface. Geoscience
surveys provide the information governments and policymakers need to
make informed decisions in the best interest of their citizens
regarding accessing mainstay energy and alternative sources, as well as
developing low-carbon strategies. Currently, those data acquired by our
members make it possible for BOEM to publish resource assessments.
Nations cannot develop and provide opportunities for energizing their
economies without the geoscience industry, let alone implement their
energy evolution goals to make reliable, affordable energy available to
their citizens and meet Net Zero Emissions (NZE) policy ambitions.
We strongly support the proposed legislation, which will help to
ensure more rigorous and comprehensive assessments of U.S. energy
supplies and a more efficient and predictable process for permitting
geoscience surveys. The energy geoscience and exploration industry
stands ready to partner in the discovery and development of low carbon
solutions and of energy dense, low emissions sources of energy to power
the world. Streamlining the permitting process along with reducing the
ability for outside special interest groups to obstruct energy
geoscience exploration is a necessary step to ensure our continued
development of energy resources and low-carbon solutions for future
generations in the U.S.
Thank you for the opportunity to testify today.
______
Mr. Stauber. Thank you very much. Our next witness is Ms.
Terra Rogers. She is the Director at Superhot Rock Energy
Program, the Clean Air Task Force, and she is stationed in
Boston, Massachusetts.
Ms. Rogers, you are now recognized for 5 minutes.
STATEMENT OF TERRA ROGERS, PROGRAM DIRECTOR, SUPERHOT ROCK
ENERGY, CLEAN AIR TASK FORCE, BOSTON, MASSACHUSETTS
Ms. Rogers. Good morning, Chairman, Ranking Member, and
distinguished members of this Committee. I appreciate the
opportunity to be here. As the Chairman commented, I am Terra
Rogers, and I do direct the Superhot Rock Program at Clean Air
Task Force. We are a global non-profit organization. I joined
CATF after 20 years in industry, just as the full potential of
geothermal was coming into focus.
Superhot rock is a visionary energy source, almost entirely
unrecognized in both the decarbonization and the energy crisis
debate. And to do my part, I aligned myself with a trusted
voice, an organization that could not profit from the public
support so desperately needed, which brings me back to CATF.
Our mission is to push technology and policy changes needed to
achieve a zero emission, high energy planet at an affordable
cost.
Today, I will share CATF's thoughts on H.R. 8665, the
Supercritical Geothermal Research and Development Act, and H.R.
7053, the Orphan Well Grant Flexibility Act, and how these
bills further the shared goals of securing the United States'
role as a clean energy leader in an abundant and affordable
energy future.
I will now refer to the handout on page 2. Traditional
geothermal facilities, shown on the far left, have been safely
and reliably operating for over 100 years by using naturally
occurring hot water from the Earth to spin a turbine and
produce electricity. These conventional systems are rare, as
they depend on unique geologic conditions, but the technology
landscape has changed. Advancements have made geothermal
possible in dry rock conditions, thus expanding its potential
to cover the globe.
This new, next-generation technology involves pumping water
into the Earth to flow through hot rocks like your car's
radiator, and returning that water to the surface for power
production, which is depicted in the middle graphic--
colloquially, Geothermal 2.0.
The distinction between 2.0 and superhot 3.0 is the
operating temperature. Now, we strongly support the measures in
this bill that address the R&D and demonstrations needed at the
temperatures accessible today, 2.0. But we must continuously
drive down costs. And by targeting higher and often deeper
temperature environments, we anticipate 5 to 10 times increase
in energy production from each well, enabling up to a 70
percent cost decrease.
To help internalize the magnitude of this opportunity,
CATF's modeling estimates that the United States could produce
4.3 terawatts of superhot rock energy. This could theoretically
satisfy the annual demands of 687 additional New York cities.
This could also be a game-changer for some of the most
promising and emerging technologies, such as AI, through data
management and low carbon hydrogen, ones that demand firm
energy.
There are four key themes identified by CATF to jumpstart
the commercialization process, and H.R. 8665 captures them all.
I will lead with the measures that are under direct
jurisdiction by this Committee.
First, data is king, and this bill appropriately
prioritizes the data resources through the MOU between DOE and
DOI, as well as a full resource assessment by the USGS through
techniques such as the deep data probes, and also including
regions previously overlooked, such as Minnesota and some of
the U.S. territories.
Second, private-public collaborations. This is established
through a center of excellence, including workforce training,
best practice development, in tandem with agencies such as the
BLM.
Third, integrated and targeted R&D designed to span the
nation's laboratories, engaging in complementary research at
the bench and in the field.
Fourth and final, in-field testing. This one is crucial.
The bill calls for the creation of a FORGE-style test bed, at
which next generation technologies and tools can be tested at
higher and higher temperatures.
We are thrilled with the substance of this legislation, but
emphasize the need for proper funding. The current $5 million
per year is insufficient and won't cover even one deep
geothermal well. Adequate funds for this bill will ensure the
resources match the bill's ambition and allow for meaningful
advancements in geothermal energy.
Other countries have already invested in supercritical
geothermal. H.R. 8665 can make the United States a leader in
this field. By advancing next-generation geothermal, we can
leverage the existing U.S. subsurface expertise and maintain
our global energy leadership.
Finally, on H.R. 7053, the Orphan Well Grant Flexibility
Act, CATF supports its intent to allow states to optimize
funding use. Some states may wish to use funding to measure
emissions from every emitting well before plugging, while
others may prefer to approximate emissions by using qualitative
comparisons, as this flexibility would free up more funds for
mitigation activities. In this case, a state should have room
to coordinate with the Federal agencies and other stakeholders.
DOI's goals of targeting high emitters and understanding the
climate impacts of orphaned well plugging are admirable, and
through collaborative effort can be accomplished at lower costs
than are currently realized.
Thank you. I look forward to your questions.
[The prepared statement of Ms. Rogers follows:]
Prepared Statement of Terra Rogers, Director, Superhot Rock Energy
Program, Clean Air Task Force
on H.R. 7053 and H.R. 8665
Subcommittee Chairman Pete Stauber, Ranking Member Alexandria
Ocasio-Cortez, and Distinguished Members of the Subcommittee:
Clean Air Task Force (CATF) is a nonprofit organization working
globally to safeguard against the worst impacts of climate change by
catalyzing the rapid development and deployment of low-carbon energy
and other climate-protecting technologies. With over 25 years of
internationally recognized expertise on climate policy and a fierce
commitment to exploring all potential solutions, CATF is a pragmatic,
non-ideological advocacy group with the bold ideas needed to address
climate change. CATF has offices in Boston, Washington D.C., and
Brussels, with staff working virtually around the world. CATF's
geothermal team works to push the technology and policy changes needed
to achieve a zero-emissions, high-energy planet at an affordable cost.
The main focus of our team is superhot rock energy, referred to in this
bill as supercritical geothermal. We believe that superhot rock energy
can become a key contributor to the energy mix, enabling clean, safe,
zero-carbon energy anytime, anywhere. Thank you for the opportunity to
testify.
The following testimony outlines CATF's thoughts on how H.R. 8665,
the Supercritical Geothermal Research and Development Act, is an
important step in positioning the U.S. as a leader in clean energy
innovation by expanding the potential of clean energy and jobs in the
coming decade. This testimony also outlines CATF's thoughts on H.R.
7053, the Orphaned Well Grant Flexibility Act, and how coordination
among Federal agencies, the states, and other stakeholders can optimize
the Bipartisan Infrastructure law Sec. 40601 Orphaned Well Program
within the scope of the clearly stated activities under that Program.
We are living in a time when communities across the country are
already facing the consequences of climate change paired with rapidly
rising energy demand and costs. Investing in climate solutions now is
not only important for protecting vulnerable communities, preserving
natural ecosystems, and ensuring a livable planet for coming
generations, it is also important for the health of local and national
economies, the workforce, and the nation's ability to meet the
residential and industrial energy demand of tomorrow. In response to
the need for dependable energy solutions, policymakers should adopt a
long-term climate and energy strategy that includes a diverse array of
options. This is not only essential for ensuring grid stability, but
also a key component to meeting current and future energy demands. The
cleanup of legacy methane emissions and investment in supercritical
geothermal innovation should both be a part of this strategy. Meeting
the energy needs of the next decade and beyond will necessitate
investment in and support for these climate solutions today.
[1] The case for geothermal innovation
Today, we have an incredible opportunity to harness the power of
innovative technologies to expand our energy resources, meet rising
demand, create new jobs, and leverage the deep expertise already
driving our energy system. To grow a stable, zero-carbon economy and
address expanding energy needs at the scale required, it is imperative
that we continue to take bold action to implement pragmatic energy
solutions. This is undoubtedly a significant challenge, but the United
States is uniquely suited to lead this effort. Just as we once rallied
our efforts in technology development for the space race, the U.S. now
has the opportunity to innovate and accelerate the development of
resilient clean energy solutions we know are possible. At this time in
history, where clean, baseload power is increasingly in demand, there
is an enormous amount of opportunity for innovation, generation of
intellectual property, and growth of durable energy options within our
domestic energy landscape. This requires targeted investment in
technology development, stakeholder collaboration, and committed
investment in de-risking and scaling of innovative climate solutions.
H.R. 8665 provides a pathway to the development of one global-scale
climate solution we need: next-generation geothermal energy.
a. The solution at hand: Next-generation geothermal energy in
supercritical environments
U.S. demand for clean, baseload power is expected to rise
significantly in the next decade, and the country has an opportunity to
advance its energy leadership by investing in geothermal innovation.
Traditional geothermal systems in operation today only work in regions
where hot water naturally exists near the surface. As a result,
traditional geothermal potential represents less than 3% of utility-
scale electric generation capacity in the U.S.1,2 However,
recent advancements in engineering have enabled a new form of
geothermal energy which can harvest the Earth's heat without the need
to locate rare and naturally-occurring underground sources of water.
These advancements, including Enhanced Geothermal Systems (EGS) and
Closed Loop Geothermal Systems (CLGS), are rapidly enhancing the
scalability of geothermal energy in the U.S.\3\ While early movers in
this industry are targeting, and will continue to target, regions in
which the heat is closer to the surface, innovations in deep drilling
are expected to unlock this resource at a global scale.\4\ When
deployed in belowground rock formations that exceed the supercritical
temperature of water, these systems could significantly boost power
potential and reduce costs, enabling geothermal energy to become cost-
competitive with the lowest-cost sources of energy today.\5\ Next-
generation geothermal (both EGS and CLGS), when operated in
supercritical temperatures, are referred to as supercritical
geothermal, or superhot rock energy.
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\1\ National Renewable Energy Laboratory. Annual Technology
Baseline: Geothermal https://atb.nrel.gov/electricity/2024/geothermal
\2\ U.S. Energy Information Administration. Electricity Explained.
https://www.eia.gov/energyexplained/electricity/electricity-in-the-us-
generation-capacity-and-sales.php
\3\ Clean Air Task Force (2023, Mar. 19). Focus on geothermal
innovation heats up with DOE's new liftoff report. https://www.catf.us/
2024/03/focus-geothermal-innovation-heats-up-does-new-liftoff-report/.
\4\ Clean Air Task Force, Superhot Rock Energy: A Vision for Firm,
Global Zero-Carbon Energy, https://cdn.catf.us/wp-content/uploads/2022/
10/21171446/superhot-rock-energy-report.pdf
\5\ Clean Air Task Force (2023, Nov. 7). A Preliminary Techno-
Economic Model of Superhot Rock Energy. https://www.catf.us/resource/
preliminary-techno-economic-model-superhot-rock-energy/.
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Superhot rock energy is an emerging energy source that will harness
massive stores of zero-carbon energy by pumping water deep into hot
underground rocks, where it naturally heats up and then returns to the
surface as steam. That steam could be used to produce abundant and
stable grid-scale carbon-free electricity. Its advanced heat streams
could also be used for industrial and commercial applications. This
inexhaustible source of both power and heat could enable industries
such as hydrogen and carbon removal, and decarbonize industrial
processes including pulp and paper manufacturing, oil and gas refining,
textile production, and more. Furthermore, the inexhaustible nature of
this renewable resource facilitates a steady cost profile and is not
subject to the volatility of the commodity market, thereby offering
price stability for electricity consumers and downstream products.
To give you an idea of the scale of this solution, heat from the
Earth's interior is continually replenished and will remain available
for billions of years--longer than the lifetime of the sun. Estimates
suggest that harnessing just 0.1% of this heat could meet the world's
total energy needs for two million years.\6\ CATF's modeling suggests
that superhot rock energy potential in the U.S. alone could produce 4.3
terawatts of clean firm power--687 times New York City's 2021 energy
consumption,\7\ and that energy source is constantly regenerating. With
appropriate investment in research, development, and testing, next-
generation geothermal energy, particularly in supercritical conditions,
could provide robust 24/7 power at a global scale without the
environmental impact and land-use footprint of most other energy
sources.
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\6\ ARPA-E, AltaRock Energy, Millimeter-Wave Technology
Demonstration for Geothermal Direct Energy Drilling, https://www.arpa-
e.energy.gov/technologies/projects/millimeter-wave-technology-
demonstration-geothermal-direct-energy-drilling
\7\ Clean Air Task Force. Mapping the Potential of Superhot Rock
Energy. https://www.catf.us/superhot-rock/heat-mapping/.
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The energy profile of the United States is changing. Projections
indicate a 5% increase in demand over the next 5 years.\8\
Specifically, we are also seeing a skyrocketing demand for baseload
power,\9\ electricity that is available without seasonal or temporal
interruptions. One driver of this potential demand increase is the data
management and artificial intelligence (AI) industry, which consumed
approximately 3% of U.S. power in 2022. It is estimated to consume
twice that much in 2 years--accounting for nearly one-third of
additional demand.\10\ Affordable and clean energy is paramount to the
success of emerging industries and the U.S. economy at large. Next
generation geothermal technologies are uniquely positioned to help
satisfy this growing demand, due to their high reliability and 24/7
profile, with an average power generation capacity of 98-99%.\11\
Resources with a firm production profile also reduce the transmission
necessary by approximately threefold in relation to more conventional
renewable sources.\12\
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\8\ Grid Strategies. The Era of Flat Power Demand is Over. https://
gridstrategiesllc.com/wp-content/uploads/2023/12/National-Load-Growth-
Report-2023.pdf.
\9\ Grid Strategies. The Era of Flat Power Demand is Over. https://
gridstrategiesllc.com/wp-content/uploads/2023/12/National-Load-Growth-
Report-2023.pdf.
\10\ International Energy Agency. Electricity 2024. https://
www.iea.org/reports/electricity-2024.
\11\ Department of Energy. Chapter 2: Geothermal Takes the Stage.
https://www.energy.gov/eere/articles/chapter-2-geothermal-takes-stage.
\12\ Environmental Defense Fund. Clean Firm Energy is the Key to
California's Clean Energy Future. https://www.edf.org/sites/default/
files/documents/LongCA.pdf.
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[2] How do we make this energy resource a reality?
Much of CATF's support for next-generation geothermal energy is
informed by a listening campaign that CATF led between 2022 and 2023.
During this time, CATF conducted 24 conversations with representatives
from 21 organizations actively engaged in geothermal innovation. These
included public and private research groups, drilling service
companies, and geothermal start-ups. The focus of this listening
campaign was to identify gaps related to the research, development, and
demonstration of next-generation geothermal energy. These learnings
were then used to inform our understanding of how to make commercial-
scale supercritical geothermal energy a reality.
Through its collaboration with stakeholders and technology leaders
across the U.S., CATF identified four key themes that could enable
supercritical geothermal energy to become an energy source capable of
meeting a significant portion of the total global demand for 24/7 low-
carbon energy. These themes include field testing and demonstration,
investment in targeted R&D, creating opportunities for collaboration,
and de-risking exploration by increasing the availability of subsurface
data. H.R. 8665 addresses all of these themes.
First, and perhaps most critical: Creating opportunities for in-
field testing and demonstration. This past year, CATF commissioned
research across the supercritical geothermal spectrum to identify the
technology gaps that exist today. The research papers focused on five
technology subsets of geothermal: site characterization, drilling, well
design and construction, heat extraction, and power production. Authors
of these reports found that across each technology area, the most
critical action that can be taken to advance the technology to be
closer to market-ready is to provide opportunity for testing in
realistic environments, and demonstration of the technology areas end-
to-end in the field.
Second: Supporting targeted research, development, and testing.
Supporting research, development, and testing within a specified
program that allows both publicly- and privately-driven technology
advancement would not just help bridge the commercialization gap for
superhot rock energy but would also enhance the durability of
conventional geothermal technologies and their ability to function in
increasingly hostile subsurface environments. Producing higher
temperature steam increases energy density, which both reduces costs by
decreasing the number of wells required, but increases electricity
production efficiency, thereby enabling a more cost competitive
product. Without a program tasked specifically with pursuing higher
temperature (supercritical) technology development, federal-level
research on supercritical geothermal is at risk of stagnation.
Additionally, by defining specific research targets rather than
providing unfocused funding, the government can minimize the risk of
leaving persistent gaps in research, development, and testing. Finally,
federal-level R&D creates an opportunity for groups working in siloes
to collaborate and to be aware of ongoing work.
Third: Providing opportunities for public-private collaboration.
Research organizations, startups, service companies, and national labs
across the U.S. have all made major strides in geothermal innovation.
Achieving commercialization of supercritical geothermal will be the
result of a series of technology innovations in numerous areas,
including drilling, stimulation, well completion, power production, and
more. Work in these spaces occurs across a diverse set of stakeholders
who are at risk of working in siloes.
Fourth: Data is a valuable resource for geothermal development, and
access to subsurface data is critical for helping companies optimize
development and reduce technological risk through well-informed
drilling programs. Though there are existing data repositories at both
the federal and state levels, they need to be better organized,
centralized, and more widely accessible. Improvement of these existing
resources could be particularly impactful. Geothermal is not the only
technology that has access to, and benefits from, a shared
understanding of challenges and resource opportunities below the
subsurface of the U.S. Other industries, like mining, oil and gas, and
carbon management, have their own data resources that exist separately
from the Department of Energy's Geothermal Data Repository and could
benefit from cooperation on subsurface data availability as well.
[3] H.R. 8665 provides the solutions we need.
H.R. 8665, the Supercritical Geothermal Research and Development
Act, promotes much-needed solutions to each of these challenges. First,
the bill supports collaboration between the Department of Energy and
the Department of the Interior in the expansion and improvement of data
resources. This includes several measures within the jurisdiction of
the House Committee on Natural Resources: Section 2(a)(3)(D) requires a
memorandum of understanding among Department of Energy, Department of
the Interior, and other relevant agencies for notifying, sharing, and
providing opportunities for data collection. Section 2(a)(3)(E)
requires the Department of Energy and Department of the Interior to
collaborate on commissioning the drilling of exploration boreholes
deeper than 8km in diverse geological provinces. Section
2(a)(4)(C)(e)(3) requires a water use study be provided to the House
Committee on Natural Resources and House Committee on Science, Space,
and Technology within 5 years of enactment. Finally, Section 2(b)
directs the U.S. Geological Survey to complete quadrennial reporting on
evolving resource potential around States like Minnesota that have very
little geothermal data. This measure would support comprehensive
mapping in regions of the U.S. that historically have not had access to
geothermal exploration. CATF believes that adequate resources should be
provided for this work to include the mapping of geothermal potential
in U.S. territories as well.
While we recognize that content pertaining solely to the Department
of Energy is not within the jurisdiction of the House Committee on
Natural Resources, the remaining pieces of the legislation interact
with natural resource use and the environment. For example, this
legislation also establishes a next-generation geothermal center of
excellence to support public-private collaboration on workforce
training, the development of best practices, the technical support for
agencies, and support testing for next-generation geothermal
technologies. The purpose of a center of excellence would be to break
down siloes and enhance communication among technology leaders at every
level of the technology suite.
This legislation also expands the remit of Frontier Observatory for
Research in Geothermal Energy (FORGE) to test EGS and closed-loop heat
extraction technologies in supercritical environments, which are not
yet mature enough to stand alone without public support for R&D and
testing. FORGE, since its establishment by the Department of Energy in
2014, has had an enormous impact on next-generation geothermal
technologies. Just next door to FORGE, Fervo Energy broke ground on its
Cape Station project, a privately funded project that aims to deliver
400 MW of 24/7 carbon-free electricity to the grid in 2026.\13\ That
serves as an example of how public investment can work quickly to
create momentum for private industry. Expanding the remit of FORGE to
test in supercritical environments would equip these technologies to be
more robust when encountering harsh belowground conditions and would
also enable these technologies to substantially increase their power
potential.
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\13\ Fervo Energy, Fervo Energy Breaks Ground on the World's
Largest Next-gen Geothermal Project, https://fervoenergy.com/fervo-
energy-breaks-ground-on-the-worlds-largest-next-gen-geothermal-project/
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This legislation also lays out a clear structure for the Department
of Energy to establish a vertically integrated ecosystem of R&D, which
would allow for the breakdown of research siloes and the ability to
share learnings across stakeholders throughout the technology
development process. The importance of R&D in this area is supported by
learnings from the Department itself: although actions like
demonstration are important for next-generation geothermal today, the
Department of Energy's recent Pathways to Next-Generation Geothermal
Commercial Liftoff report also tells us that continual research and
development is important for geothermal to achieve cost reductions and
scalability.\14\ Through our extensive research and five flagship
reports, CATF has identified that high-impact R&D should include deep
drilling, well construction and completion, reservoir engineering, and
an understanding of rock properties in supercritical environments. This
is all reflected in the structure of the R&D program defined in the
legislation before us today.
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\14\ U.S. Department of Energy, The Pathway to Next-Generation
Geothermal Power Commercial Liftoff, https://liftoff.energy.gov/next-
generation-geothermal-power/
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Finally, as the work under this legislation develops, it is
important that it matures with an updated understanding of the
technology. This is reflected in this legislation's required
quadrennial reports on water consumption, resource potential, and
barriers to development as the technology and understanding of the
resource evolves.
R&D for next-generation geothermal energy, focused on advancing
emerging technologies to higher temperatures, higher power potential,
lower costs, and greater potential for global scalability, could be
transformative in our fight for a future of 24/7 low-carbon energy.
H.R. 8665 is an important step in doing just that. It addresses each of
the challenges that CATF discovered in its comprehensive work with
stakeholders across the U.S. Other countries, like China, New Zealand,
Japan, and Iceland, have already made significant investments in
supercritical geothermal, and this bill could position the U.S. as a
leader in this space. The existing energy workforce, supply chain, and
subsurface expertise in the U.S. is well-positioned to support a rapid
scale-out of next-generation geothermal as soon as the technology is
adequately mature. By promoting targeted public and private research,
breaking down siloes, and leveraging the vast subsurface expertise that
already exists in the U.S., this legislation does exactly what is
needed to boost the momentum we see for next-generation geothermal
energy and achieve temperature conditions that could be
transformational in empowering a resilient, low-carbon economy.
[4] To make the impact intended, H.R. 8665 must be properly funded.
In order to achieve the significant impact intended in H.R. 8665,
it is crucial that the bill receives proper funding. Currently, the
bill is allocated only $5 million per year, which is far from
sufficient given its goals. To put this in perspective, $5 million
would not cover the cost of a single deep geothermal well. H.R. 8665
sets up research programs, a center of excellence, field testing
opportunities, and more, but offers next-to-no funding to do this work.
To truly make a difference, proper resourcing is necessary. This
funding will ensure that the resources match the bill's ambitious
intent and allow for meaningful advancements in geothermal technology.
Investing in geothermal innovation, with a focus on supercritical
geothermal, is not only feasible but also imperative, given its massive
potential. Supercritical geothermal offers unique benefits, comparable
in terms of reliability, emissions, and land use only to advanced
nuclear technology, which CATF also supports. CATF is thrilled with the
substance of this bill, including the structures and programs that it
supports. However, proper resourcing is essential for H.R. 8665 to have
the intended impact on geothermal innovation. With adequate funding,
these structures, including targeted research, public-private
collaborations, and more, will make a real impact on geothermal
innovation and its role in expanding zero-carbon energy resources.
[5] A long-term vision
CATF envisions next-generation geothermal energy maximizing its
potential and progressing down a pathway that, ultimately, does not
require federal investment or market incentives. However, to get to
this point on the commercialization curve, momentum is needed in
research, testing, and collaboration. CATF sees the federal government
as playing a few key roles in technology development at this stage:
taking on technology risk, catalyzing research and development,
developing best practices, fostering collaboration, and removing
barriers for geothermal to scale rapidly. H.R. 8665 is structured to do
all of these things.
Large private sector energy players are eagerly waiting on the
sidelines for evidence that supercritical geothermal can work, and we
are confident that significant private capital will flow into next
generation geothermal if we can help address some of the remaining
technological barriers. The public sector is in a unique position to
take on technological risk and bridge the gap between research and
deployment. Programmatic support for R&D and testing can work to
advance and iterate on new technologies until private companies are
able to significantly invest and enable the technology to be
competitive in energy markets. Testbeds like FORGE and opportunities
for public-private collaboration also provide an opportunity for
private stakeholders to improve their technologies in a lower-risk
environment.
Achieving commercialization of supercritical geothermal will be the
result of a series of technology innovations in numerous areas,
including drilling, stimulation, well completion, power production.
Work in these spaces today often occurs across a diverse set of
stakeholders who are at risk of working in siloes. Federal programs can
help next-generation geothermal develop by encouraging collaboration
between stakeholders at every level, including international allies,
government agencies, academic institutions, and private companies. This
bill takes collaboration one step further by establishing a public-
private center of excellence. In addition to fostering collaboration in
R&D and testing, the center of excellence in this bill is also well-
positioned to provide a common source for the development of best
practices. These practices are necessary to ensure technology
deployment, equity, safety, and efficacy of nascent energy types like
next-generation geothermal.
The United States trails other countries in its investment in
geothermal energy innovation. However, energy companies based in the
U.S. hold nearly all of the skilled workforce and supply chains
required for producing next-generation geothermal energy. These energy
companies maintain unrivaled expertise in the energy extraction
techniques that are key to the success of next generation geothermal
exploration, such as directional drilling, reservoir engineering, well
completions, and more. Unlike many of the leading countries, the U.S.
has a unique opportunity to rapidly scale up geothermal technologies by
applying its subsurface expertise and harnessing existing supply chains
to become a global leader in the development of clean, 24/7
electricity. The explicit federal support for next-generation
geothermal in this bill also would signal to investors that the
industry is expected to play a significant role in the future,
triggering a cycle of increased investment from the private sector.
CATF believes that H.R. 8665 would help to be a kickoff point for
meaningful private investment.
[6] The land footprint of energy resources: The impact of investment in
supercritical geothermal, in the context of increased siting on
federal lands.
CATF applauds recent steps the Administration and Congress have
made toward improved clean energy siting on federal public lands.
Forward-looking management of public lands can ensure ecosystem
resilience and facilitate the necessary development of renewable and
zero-carbon energy infrastructure. In this context, accelerating the
timeline to commercial scale for technologies that minimize land use
and maximize energy density becomes particularly important.
Supercritical geothermal is expected to be an extremely energy-dense
resource, so its land requirements will be exceptionally low. Producing
1 GW of superhot rock energy is estimated to require roughly 12 km2 (7
sq mi) of land, compared to approximately 160 km2 (100 sq mi) of land
for natural gas.\15\ Initiatives to support research and development of
this clean, firm power source that has a lower calculated land use is
critically important.
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\15\ Land use estimates for superhot rock energy from LucidCatalyst
and Hotrock Research Organization. (2023). A Preliminary Techno-
Economic Model of Superhot Rock Energy. https://www.catf.us/resource/
preliminary-techno-economic-model-superhot-rock-energy/
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When considering smart siting for federal public lands, it is
important that any new policy solutions are constructive. CATF supports
increasing the Department of the Interior's goal for renewable energy
permitting. We also support more comprehensive planning for renewable
energy siting on federal public lands, including through programmatic
reviews for specific forms of clean energy development and other
benefits for renewable energy permitting. In testimony before this
committee two years ago, the Bureau of Land Management indicated its
intent to review wind, solar, and geothermal programmatic environmental
reviews.\16\ CATF has engaged with the BLM on its ongoing solar
environmental review, and we support actions that would require the
agency to initiate the other two planning processes. We see a
significant contrast between these efforts to improve clean energy
siting and the proposals in Project 2025 to eviscerate the Department
of the Interior, which is critical to ensuring the health and
preservation of our limited resources for future generations.
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\16\ Hearing on Expanding Clean Energy on Public Lands and H.R.
3326, Public Land Renewable Energy Development Act, 117th Cong. (2021)
(statement of Nada Wolff Culver, Deputy Director, Policy & Programs,
Bureau of Land Management), https://www.doi.gov/ocl/pending-
legislation-17.
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[7] H.R. 7053--Orphaned Well Grant Flexibility Act
Reducing emissions of methane, a potent greenhouse gas with a
warming potential over 80 times greater than that of carbon dioxide
over a twenty-year period, must play a crucial role in any greenhouse
gas mitigation. Because of its warming potency and atmospheric
lifetime--which is much shorter than that of carbon dioxide--
establishing policies to quickly reduce methane emissions is the
fastest way to slow the escalating rate of global warming and bend the
climate curve. In the U.S., the oil and gas sector is one of the most
important sectors to address, along with landfills and agriculture.
Within the oil and gas sector, orphaned wells present a unique
challenge to mitigate. This is because orphaned wells have no
financially responsible owner or operators. This lack of responsibility
has resulted in over a hundred thousand documented orphaned wells that
have been left to pollute air and water resources until third parties,
either on their own or with state or federal funding, step in to plug
them, and the scope of the challenge is likely even higher since there
are many times more orphaned wells that have yet to be documented.
While we grapple with the immense challenge of existing orphaned wells,
we are mindful that in the absence of policy change, well orphaning
continues to occur because of insufficient bonding requirements,
permissive well transfer rules and lax oversight of idled wells. If
these policies are not modernized, the challenge of mitigating methane
and other pollution from end-of-life wells will continue to grow.
This is the challenge Congress recognized in passing the REGROW Act
as part of the Infrastructure Investment and Jobs Act (IIJA), providing
an important tool to meet the orphaned well challenge by establishing a
framework for states to address this source of emissions through
funding for any of the articulated purposes in the bill. See 42 U.S.C.
Sec. 15907(c). As the Department of the Interior (DOI) moves forward
with administering this program it should do so in a way that maximizes
the opportunities provided in the IIJA.
The policy objectives that DOI currently seeks to advance in its
guidance by requiring all wells leaking methane to be measured pre-and
post-closure may not optimize this opportunity. Measuring methane
emissions from orphaned wells can provide more certainty about the
reductions that can be achieved by permanently plugging a well and help
identify the largest emitters for prioritized plugging. Alternatively,
outside of IIJA funding, the reductions can be monetized through
voluntary carbon markets, and thus third-party implementers should be
strongly encouraged to measure both before and after remediation once
those technologies are proven to accurately show the emissions
reductions over appropriate time horizons. However, requiring such
measurements as part of IIJA funding could limit what can be achieved
due to the cost of measurement: upwards of $5,000 per well.\17\ Because
the amount of funding under the IIJA is finite, spending more on
measuring means spending less on well plugging, and thus fewer
communities are afforded the benefits that result from reduced air and
water contamination.
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\17\ Indeed there are other Federal efforts led by the U.S.
Department of Energy that will, over time, drive the costs of such
measurements down and develop workable methodologies to assess such
emissions, making measurement a more efficient use of taxpayer money.
---------------------------------------------------------------------------
Instead of requiring all emitting wells to be measured before and
after plugging, CATF supports a more flexible approach. Some states may
wish to use some of the funding they receive from a formula grant to
measure every well. If that's the case, they should be allowed to make
that choice as doing so is permitted under the statute's original
language. 42 U.S.C. Sec. 15907(c)(2)(A)(v)(I). But if a state instead
prefers, it should have room to coordinate with DOI, DOE, and other
stakeholders to approximate emissions by sampling and using qualitative
comparisons of wells, rather than always quantitatively assessing
emissions from each emitting well. In addition, or alternatively, it
could also implement alternative approaches for bucketing wells into
non-emitting, low-emitting, and high-emitting categories. Additionally,
states need to have flexibility to use funding to perform the
activities originally articulated in the REGROW Act without requiring
pre-plugging measurement. The policy goals of targeting high emitters
and understanding the climate impacts of orphan well plugging are
admirable, and through collaborative effort can be accomplished at
lower costs than are currently realized through existing guidance. But
all states should be encouraged to monitor pre-and post-remediation and
to explore other ways to offset those increased costs rather than IIJA
funds.
This program is an opportunity for genuine collaboration between
state and federal agencies to solve a long-standing and vast problem.
The DOI should consider meeting with DOE, the states, other
stakeholders, and partners in the Administration and Congress to
discuss and implement alternative approaches to universal methane
quantification while retaining policy objectives.
[8] Conclusion: The Supercritical Research and Development Act is a
step in the right direction.
CATF believes that a diverse array of energy solutions will be
required to empower a low-carbon economy. Growing our clean energy
sources, improving systems to support the abatement of fossil fuel
emissions, and working to reduce legacy emissions, including methane,
are all important for addressing climate change. Proactively investing
in emerging solutions for growing our clean energy resources is
important for addressing the climate crisis while meeting the full
scale of our country's energy needs.
Next-generation geothermal offers unique advantages as a clean and
reliable energy source. It features a minimal environmental footprint,
a large source of 24/7 energy, and, with additional research and
development, could become widely available across diverse geographies.
The Department of Energy's recent Next-Generation Geothermal Liftoff
report provides evidence for our need for this resource, indicating
that the U.S. grid will require 700-900 GW of additional clean firm
capacity by 2050.\18\ This is something we need to take seriously.
---------------------------------------------------------------------------
\18\ Department of Energy. Pathways to Commercial Liftoff: Next-
Generation Geothermal Power https://liftoff.energy.gov/wp-content/
uploads/2024/03/LIFTOFF_DOE_NextGen_Geothermal_v14. pdf.
---------------------------------------------------------------------------
The passage of H.R. 8665 with appropriate funding is an important
step in advancing next-generation geothermal technologies, particularly
in energy-dense, supercritical environments. These technologies hold
immense potential to secure the United States' leadership in meeting
the increasing demand for baseload clean power in the coming decade. By
harnessing the Earth's virtually unlimited heat energy, we can
accelerate the decarbonization of our energy sources, ensuring energy
security and a resilient low-carbon economy. While various stakeholders
are eager to engage in the advancement of geothermal innovation, public
sector support is crucial to creating meaningful momentum and a pathway
to commercial-scale adoption. H.R. 8665 takes a much-needed step toward
this future.
*****
The following document was submitted as a supplement to Mr.
Rogers' testimony.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
The full document is available for viewing at:
https://docs.house.gov/meetings/II/II06/20240723/117484/HHRG-
118-II06-20240723-SD006.pdf
------
Mr. Stauber. Thank you very much. Our next witness is Mr.
J.C. Sandberg. He is the Chief Advocacy Officer for the
American Clean Power Association, and he is stationed in
Washington, DC.
Mr. Sandberg, you are now recognized for 5 minutes.
STATEMENT OF J.C. SANDBERG, CHIEF ADVOCACY OFFICER, THE
AMERICAN CLEAN POWER ASSOCIATION, WASHINGTON, DC
Mr. Sandberg. Thank you, Mr. Chair, Madam Ranking Member,
and members of the Subcommittee. It is a privilege to be here,
and we appreciate the invitation to testify on H.R. 8954, The
Public Land Renewable Energy Development Act--say that five
times fast--of 2024, PLREDA.
Renewable energy has become a significant part of our
nation's energy mix, providing 16 percent of U.S. electricity
in 2023, with nearly 270 gigawatts online, enough to power more
than 68 million homes. The industry provides 460,000 jobs,
supporting jobs in every state in our country, and delivers $3
billion each year in state and local taxes and landowner lease
payments. In the past 2 years alone, the nation has seen
massive deployment of a wide range of renewable energy, largely
on private lands, resulting in more than $468 billion in
private-sector investments and more than 44,000 manufacturing
jobs.
It is critical that Congress continue to build on this
momentum by using public lands to further unlock the industry's
economy stimulating and community revitalizing potential.
Building more renewable energy on public lands will allow our
nation to address the rapidly growing demand for electricity
and ensure reliability. That is why I offer ACP's support for
PLREDA 2024. This bill will ensure a fair return to states and
counties for renewable energy development, promote related
conservation efforts, and expedite the processing timelines for
renewable energy projects on public lands.
Federal law requires that oil and gas revenues must be
shared with states, and that geothermal revenues must be shared
with states and counties. By allocating 25 percent of the
Federal revenue to the county where the wind or solar facility
is located, and another 25 percent to the state, this bill
would help boost local economies and guarantee that states and
residents rightly benefit financially from the renewable energy
projects they host in their communities, thus providing them
with additional funds to invest in schools, libraries, roads,
and other public services.
Additionally, the Renewable Energy Resource Conservation
Fund set up by the bill will help Federal, state, local, and
tribal agencies support their conservation efforts in areas
hosting renewables, including efforts to restore and protect
fish and wildlife habitats, corridors, and wetlands.
It is also important to recognize that improvements to
deploying renewables on public lands can only go so far if BLM
and the U.S. Fish and Wildlife Service offices don't have the
resources necessary to process permits. As proposed in PLREDA
2024, allocating revenue to these land agencies to add capacity
and skills to effectively manage and process renewable energy
permits will help maximize the potential for renewable energy
development on public lands.
Ultimately, revenue sharing is a win-win. It supports
renewable energy development on public lands, while at the same
time ensuring that benefits of this development further support
the people and areas where the projects are located. To that
end, ACP would encourage the Committee to include energy
storage in the definition of energy project as you work to
finalize the bill. Including energy storage in the definition
of renewable energy project is a common-sense measure that will
make sure states and communities benefit from all aspects of
renewable energy development on public land and the revenue
sharing program created by this bill.
I would also like to encourage the Committee to continue
its work to improve the permitting process for energy
infrastructure. I provided some specific ideas in my written
testimony. While PLREDA 2024 represents a significant step
toward facilitating the development of renewable energy
projects on public lands, our nation's cumbersome and uncertain
permitting process impedes critical energy infrastructure
development, effectively preventing counties and states from
receiving the revenue this legislation would authorize.
In conclusion, ACP strongly supports H.R. 8954, which is
vital to unleashing our nation's clean energy potential across
the country.
I look forward to your questions, and thank you again for
the opportunity to testify.
[The prepared statement of Mr. Sandberg follows:]
Prepared Statement of JC Sandberg, Chief Advocacy Officer, American
Clean Power Association
on H.R. 8954
Chairman Stauber, Ranking Member Ocasio-Cortez, and members of the
House Natural Resources Subcommittee on Energy and Mineral Resources,
thank you for the invitation to offer testimony on H.R. 8954, the
Public Lands Renewable Energy Development Act of 2024 (PLREDA 2024). My
name is JC Sandberg, and I am the Chief Advocacy Officer for the
American Clean Power Association (ACP). ACP represents over 800
companies focused on deploying utility-scale clean energy. ACP unites
the power of solar, onshore and offshore wind, storage, green hydrogen,
and transmission developers, along with manufacturers and construction
companies, owners and operators, utilities, and corporate purchasers of
clean energy.
Today, I offer ACP's support for PLREDA 2024. There has been
longstanding bipartisan interest in a revenue sharing program that
ensures investment in domestic renewable energy on public lands will be
reinvested in the states and local communities that host these
projects, as well as in conservation efforts in these areas and to
improve the processing of permits on these lands. ACP appreciates this
Committee's interest in advancing legislation that will help make these
goals a reality.
Our nation is experiencing a breakthrough in domestic energy
production and rapid growth in demand for electricity. Seizing and
meeting this opportunity is dependent on the continued strength in
traditional energy production while unleashing a massive deployment of
a wide range of renewable energy technologies, including on public
lands. Renewable power has already become a significant part of our
nation's energy mix. Wind and solar produce 16% of U.S. electricity
with nearly 270 GW online--enough electricity to power more than 68
million homes.
The industry provides 460,000 American jobs, supporting jobs in
every state in our country, and delivers $3 billion each year in state
and local taxes and landowner lease payments. In the past two years
alone, the nation has seen massive deployment of a wide range of
renewable energy, largely on private lands, though--resulting in more
than $488 billion in private-sector investments and more than 44,000
manufacturing jobs.\1\
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\1\ American Clean Power Association, Clean Energy Investing in
America, https://cleanpower.org/investing-in-america/.
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It is critical that Congress continue to build on this momentum by
using public lands to further unlock the industry's economy-stimulating
and community-revitalizing potential. By ensuring that renewable energy
projects provide steady revenue to speed up the permitting process on
public lands and provide additional economic and environmental benefits
to the communities that host these projects, this bill will do just
that.
The good news is that Federal lands managed by the Bureau of Land
Management (BLM) and the United States Forest Service (USFS) have a
vast potential for renewable energy development. BLM and USFS manage
245 million and 193 million acres of public land, respectively,\2\ with
the potential to produce thousands of gigawatts (GW) of renewable
energy.\3\ In fact, researchers estimate that there are 2,100 GW of
potential energy generation from renewables on BLM lands alone.\4\
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\2\ Bureau of Land Management, What We Manage Nationally, https://
www.blm.gov/about/what-we-manage/national (explaining that BLM
administers one-tenth of America's land base); U.S. Forest Service,
Meet the Forest Service, https://www.fs.usda.gov/about-agency/meet-
forest-service.
\3\ Clean Air Task Force, The technical potential for clean energy
deployment on BLM and other federal lands in the lower forty-eight
United States (Jan. 2024), https://www.catf.us/2024/01/clean-energy-
deployment-potential-blm-federal-lands/.
\4\ Id.
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The bad news is that despite some recent efforts to encourage
renewable energy development on public lands,\5\ these resources
continue to be vastly untapped relative to their potential. As of 2023,
a little over 60 solar and wind projects have been approved on BLM
lands, and BLM currently only has an equivalent number of renewable
energy projects, representing a mere 29 GW of energy generation, under
review.\6\ This problem is made even clearer when comparing renewable
energy development on public lands with that on private land.
Currently, around 95% and 99% of operating capacity for solar and wind,
respectively, is on private lands. As of the end of 2023, 3,728
megawatts of solar energy (with an additional 1,556 MW approved but not
yet constructed) and 1,438 MW of wind energy was operating on BLM lands
(with an additional 3,038 MWs approved but not yet constructed \7\
compared to 94,425 MW of operating utility-scale solar capacity
nationwide and 150,455 MW of operating wind capacity.\8\
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\5\ Bureau of Land Management, Biden-Harris Administration delivers
historic milestones, new actions for clean energy on public lands
(April 11, 2024), https://www.blm.gov/press-release/biden-harris-
administration-delivers-historic-milestones-new-actions-clean-energy
(explaining that the Department has recently permitted more than 25
gigawatts of clean energy projects on public lands, which is enough
clean energy to power more than 12 million homes across the country,
surpassing the Energy Policy Act of 2020's public land utilization
targets ahead of the 2025 deadline).
\6\ Bureau of Land Management, Active Renewable Projects, https://
www.blm.gov/programs/energy-and-minerals/renewable-energy/active-
renewable-projects.
\7\ See https://www.blm.gov/programs/energy-and-minerals/renewable-
energy/active-renewable-projects, https://www.blm.gov/sites/default/
files/docs/2023-03/PROJECT_LIST_SOLAR_FY2022. pdf, and https://
www.blm.gov/sites/default/files/docs/2021-11/PROJECT%20LIST%20WIND_
October%202021.pdf.
\8\ American Clean Power Association, Clean Power Annual Market
Report 2023.
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This disparity can largely be explained by the fact that it is less
attractive to develop projects on public lands due to the long,
uncertain, and costly permitting delays on them, which have ripple
effects throughout the economy--throwing off project timelines,
domestic supply chains, and the indirect jobs and economic activity
that would have otherwise occurred.
PLREDA 2024's revenue recycling sharing program will help change
this dynamic by providing more resources to expedite permitting and
financial benefits for host states and counties, and allow the nation
to realize the potential for renewable energy on public lands, creating
more good-paying American jobs, strengthening the reliability and
resiliency of the grid, promoting energy independence, and reducing
electricity costs for consumers, all the while providing key revenue
and environmental benefits to the areas in which they reside.
HR 8954 Will Ensure a Fair Return for States and Counties, Conservation
Efforts, and Expedite the Processing of Permits
ACP strongly supports the revenue sharing proposal in PLREDA 2024
as it will ensure a fair return for states and counties from renewable
energy development, promote related conservation efforts, and expedite
the processing timelines for renewable energy projects on public lands.
Currently, 100% of rents, fees, and other revenues generated from
wind and solar energy projects on public lands are directed to the
Federal treasury. In contrast, Federal law requires that oil and gas
revenues must be shared with states, and that geothermal revenues must
be shared with states and counties. PLREDA 2024 would create parity in
the treatment of revenues of energy resources on public lands by
reinvesting revenues from renewable energy projects back into
surrounding states and counties, conservation efforts, and the
processing of permits.
Specifically, by allocating 25% of the federal revenue to the
county where the project is located and another 25% to the state, this
bill will help boost local economies and guarantee that state and local
residents rightly benefit financially from the renewable energy
projects they host in their communities. As with the sharing of
revenues from other energy sources, such as oil and gas, communities
can invest revenue from these projects in schools, libraries, roads,
and other public services.
Equally, the Renewable Energy Resource Conservation Fund set up by
the bill will help Federal, state, local and Tribal agencies support
their conservation efforts, including efforts to restore and protect
fish and wildlife habitats, corridors, and wetlands. As such, the bill
strikes an important balance between supporting renewable energy on
public lands while helping preserve these lands and their surrounding
areas for other uses, such as hunting, fishing, hiking, and biking.
It is also important to recognize that improvements to deploying
renewables on public lands can only go so far if BLM and USFS offices
don't have the resources to process their permits. By allocating
revenue that could be used to add to the capacity and skills to
effectively manage and process renewable energy permits on public
lands, the gap between the potential for renewable development on
public lands and the actual number of projects developed thereon can be
narrowed.
Ultimately, revenue sharing is a win-win. It supports renewable
energy development on public lands, while at the same time ensuring
that the benefits of this development further support the areas in
which they are located.
Include Energy Storage
We encourage members to consider including energy storage in the
definition of energy project as they work to finalize the bill.
Including energy storage in the definition of renewable energy project
is a commonsense measure that will make sure states and communities and
their environments benefit from all aspects of renewable energy
development on public lands and the revenue sharing program created by
this bill. Many developers build hybrid projects that include both
renewable energy generation, such as wind and solar, and energy
storage, as well as standalone storage projects. Permitting fees from
all these resources should be included in any revenue sharing
provision.
Further Permitting Reforms
While this bill represents a significant step toward facilitating
the development of renewable energy projects on public lands through
revenue sharing, more reforms are needed to support the responsible,
effective, and efficient siting of critical energy infrastructure on
these lands and across the nation. To that end, ACP encourages this
Committee and Congress consider other reforms, consistent with the
broader bipartisan NEPA reforms enacted by Congress in 2023, that would
improve the permitting process for energy infrastructure, including the
following:
Application Processing Timeline: Establish a default
timeline of 30 days from the date of receipt of an
application for a Cost Recovery Agreement and not more than
180 days for the issuance of the Notice of Intent (NOI) for
an Environmental Impact Statement (EIS) and less for an
Environmental Impact Statement; these milestones start the
clock for preparing a NEPA document and agencies can avoid
triggering it by slow-walking the issuance of them.
Subsequent Authorizations: Require authorizations after a
NEPA document is finished to be issued no later than 180
days after the issuance of a record of decision or finding
of no significant impact; once NEPA review is done,
agencies can delay the issuance of a permit by foot-
dragging these authorizations.
Expand Utilization of Programmatic Review: Require
agencies to use programmatic environmental documents and
tiering from those documents to expedite the issuance of
project-specific permits and eliminate repetitive
considerations of the same issues.
Categorical Exclusion Process Improvements: Establish
improvements to improve the use of categorical exclusions
and require agencies to issue requests for information to
solicit ideas for new categorical exclusions.
Conclusion
ACP strongly supports PLREDA 2024 which is vital to unleashing our
nation's clean energy potential across the United States. Revenue
sharing will encourage development of renewable energy projects on
federal public lands--commensurate with their potential to host them--
while ensuring a fair return for states, counties, and conservation.
______
Mr. Stauber. Thank you very much. Our next witness is Dr.
Steve Feldgus. He is the Principal Deputy Assistant Secretary
for the Land and Minerals Management at the Department of the
Interior, and he is based right here in Washington, DC.
Dr. Feldgus, welcome. You are now recognized for 5 minutes.
STATEMENT OF STEVE FELDGUS, PRINCIPAL DEPUTY ASSISTANT
SECRETARY FOR LAND AND MINERALS MANAGEMENT, DEPARTMENT OF THE
INTERIOR, WASHINGTON, DC
Dr. Feldgus. Thank you, Chairman Stauber, Ranking Member
Ocasio-Cortez, and members of the Subcommittee, for the
opportunity to provide testimony on behalf of the Department of
the Interior. My name is Steve Feldgus, and I am the
Department's Principal Deputy Assistant Secretary for Land and
Minerals Management. I am pleased to be able to provide
testimony today on three pieces of legislation: H.R. 7053, the
Orphan Well Grant Flexibility Act; H.R. 8954, the Public Land
Renewable Energy Development Act; and the discussion draft of
the Comprehensive Offshore Resource Evaluation, or CORE Act.
These bills address critical issues related to programs
managed by various parts of the Department, including the
Orphan Well Grant program, renewable energy development on
public lands, and oil and gas development on the Outer
Continental Shelf.
H.R. 7053, the Orphan Well Grant Flexibility Act, relates
to the Department's orphaned well grant programs established by
Section 40601 of the Bipartisan Infrastructure Law. H.R. 7053
would prohibit requiring states to collect methane emissions
data as a condition of eligibility for orphaned well grants.
Additionally, the bill requires the National Academies of
Sciences, Engineering, and Medicine to conduct a study on the
community impact of the Orphan Well Grant program.
The Department supports the proposed study, as we strongly
believe in the value of comprehensive and accurate data to
assess the effectiveness of taxpayer-funded initiatives. For
the same reason, the Department believes that methane
measurement is essential for understanding the effectiveness of
the Orphan Well Grant program. Accurate methane data is crucial
for evaluating the success of our well-plugging activities, and
for making informed decisions that protect our communities and
the environment.
Methane emissions from orphaned wells contribute
significantly to environmental, safety, and economic
challenges. Without accurate data, effective mitigation becomes
extremely difficult. The elimination of methane monitoring
requirements for grant recipients would severely hamper the
effectiveness of the orphaned well program and, as a result,
the Department cannot support H.R. 7053.
Turning to H.R. 8954, the Public Land Renewable Energy
Development Act, this bill would establish a new distribution
structure for revenue from solar and wind development on public
lands. Currently, all revenues from such development goes to
the U.S. Treasury. Under the bill, half of all revenues would
be allocated to the states and counties in which the
development was located; one quarter would go to the Department
of the Interior for administration of the BLM's renewable
energy program, including actions to facilitate processing of
renewable energy permits on Federal lands; and the remaining
quarter would be deposited in a new Renewable Energy Resource
Conservation Fund. This fund would be used to support
protection and restoration of important fish and wildlife
habitat and water resources, as well as to secure recreational
access to Federal lands.
The Department is committed to responsibly mobilizing the
tremendous renewable energy resources of our nation's public
lands, and we look forward to working further with the sponsor
and the Subcommittee on this shared goal. We recognize the
interests of states and counties in receiving benefits from
development on public lands in their jurisdiction, and this
revenue allocation would be extremely helpful for supporting
the additional responsibilities that states and counties take
on to accommodate and manage renewable energy projects that are
located in their jurisdictions.
The Department also recognizes the potential benefits that
could come from the fund established by the bill, which would
enhance outdoor recreation opportunities and support state and
tribal wildlife conservation efforts to mitigate potential
impacts from renewable energy development.
Finally, the Department appreciates that the bill exempts
cost recovery revenue from the new revenue distribution
structure, as those funds are essential for BLM to cover
application processing costs.
Regarding the discussion draft of the CORE Act, our
preliminary review indicates that the bill amends Section 357
of the Energy Policy Act of 2005 to expand the Department's
comprehensive inventory and analysis of undiscovered oil and
natural gas resources on the Outer Continental Shelf. The
Department notes that these changes will require additional
research, funding, and time to conduct. In addition, some of
the provisions within the discussion draft regarding analysis
and forecasting may duplicate existing provisions.
The discussion draft also contains a number of provisions
regarding incidental take authorizations under the Marine
Mammal Protection Act, and geological and geophysical surveys
related to oil and gas activities in the Gulf of Mexico. While
the Department strongly supports permitting and authorization
efficiency, we also emphasize the need to thoroughly evaluate
the impacts associated with oil and gas activities, including
geological and geophysical surveys on marine resources. The
Department would like to work with the sponsor and the
Subcommittee on how the bill's requirements could be aligned
with the Department's existing processes, while ensuring
continued protection of important marine resources.
Finally, I would like to note that the U.S. Geological
Survey has provided a statement for the record on H.R. 8665,
the Supercritical Geothermal Research and Development Act.
Thank you again for the opportunity to testify on these
bills, and I look forward to your questions.
[The prepared statement of Dr. Feldgus follows:]
Prepared Statement of Steve Feldgus, Ph.D., Principal Deputy Assistant
Secretary, Land and Minerals Management, U.S. Department of the
Interior
on H.R. 7053 and H.R. 8954
H.R. 7053, the Orphan Well Grant Flexibility Act of 2024
Introduction
Thank you for the opportunity to testify on H.R. 7053, the Orphan
Well Grant Flexibility Act of 2024. The bill relates to the Department
of the Interior's (Department) orphaned well grant programs established
under Section 349 of the Energy Policy Act of 2005, as amended by
Section 40601 of the Infrastructure Investment and Jobs Act (IIJA), and
would, among other impacts, change methane emission measurement
requirements for state grant recipients. Because understanding the
reduction in methane emissions is critical to measuring the success of
the orphaned well program and in line with clear Congressional intent
in the IIJA, the Department opposes the bill. We appreciate the efforts
of the Sponsors and the Subcommittee on the bill, and we look forward
to continuing to work with Congress through the legislative process.
Background
Methane is a flammable greenhouse gas that is a significant driver
of climate change. It is 80 times more potent than carbon dioxide at
warming the atmosphere. Orphaned wells in the United States often emit
methane continuously, exacerbating climate problems, and volatile
organic compounds that can impact the health of nearby communities.
Section 40601 of the Infrastructure Investment and Jobs Act (IIJA)
established the Department's orphaned well grant program, and the IIJA
appropriated approximately $4.7 billion for Tribal and State financial
assistance programs as well as a federal program, which are managed by
the Department's Orphaned Wells Program Office.
Since the enactment of the IIJA on November 15, 2021, the
Department has awarded $565 million in initial grants to 25 states,
which has been used to plug more than 7,700 wells as of March 31, 2024.
In November 2023, the Department reported to Congress that based on
information provided in the State Initial Grant Quarterly Performance
reports, as of June 2023, combined annual pre-plugging methane
emissions from a total of 497 wells measured in four states were equal
to approximately 11,530 metric tons of carbon dioxide equivalent
emissions per year. The Department has also awarded $394 million in
formula grant awards to 16 states, and recently opened the application
window for matching grants, the first of two categories of state
performance grants, making up to $30 million available per state. In
September 2023, $40 million was made available to Tribes in an initial
round of funding, and a second round of Tribal grant applications are
currently under review. Five federal land management agencies have also
received nearly $150 million in funds to plug orphaned wells on federal
lands.
Nationwide, investments through the Department's new program are
estimated to have supported over 7,200 jobs and contributed more than
$900 million to the economy over the last two fiscal years.
Due to the limited timeframe for States to use initial grant
funding, for work funded by those grants States were encouraged but not
required to detect and measure methane emissions at orphaned wells
before and after plugging operations. For formula and performance
grants, because methane emission reduction is one of the clear
priorities of IIJA Section 40601--it is the only section under Division
D, Title VI, which is titled ``Methane Reduction Infrastructure'', and
the amount of methane emissions reduced is a requirement of the report
to Congress in that section--methane measurement is a requirement when
plugging wells using those funds.
H.R. 7053, the Orphan Well Grant Flexibility Act of 2024
Section 2 of the bill would make the collection of methane
emissions monitoring data optional for the State financial assistance
program and preclude methane measurement from being a condition of
eligibility for orphaned well grants. These changes would severely
hamper the effectiveness of the orphaned well program, and the
Department does not support this change. The Department is also
concerned that, as written, Section 2 of the bill creates ambiguity and
could lead to a number of unintended consequences.
The Department supports Section 3 of the bill, requiring the
National Academies Study on Community Impact of Orphaned Well Grant
Program.
Methane Measurement Impacts
It is critical to continue measuring methane emissions at each
orphaned well that is plugged. Methane measurement is necessary to
verify the success of a plugging operation. Since background levels of
natural methane exist, there is no way to certify the effectiveness of
the plugging operation other than comparing direct methane measurement
before and after plugging. Methane measurement also furthers grant
program requirements under 2 C.F.R. 200 to measure the recipient's
performance to show achievement of program goals and objectives, share
lessons learned, improve program outcomes, and foster adoption of
promising practices.
Detecting and measuring methane from wells helps mitigate serious
human safety concerns. Instruments that detect methane can also detect
toxic gases like hydrogen sulfide, ensuring that mitigation steps can
be taken to keep the public and workers safe before well plugging
begins. In addition, economically disadvantaged communities often bear
a disproportionate burden of environmental hazards, including methane
and toxic gas emissions from orphaned wells. Ensuring robust before and
after measurements of well plugging helps identify and prioritize
potential high-polluting wells that could be located near vulnerable
populations that experience negative health impacts associated with
poor air quality.
Not all orphaned wells emit methane at the same rate. Some are high
emitters that release significant amounts of methane, posing increased
safety and environmental risks. Methane emissions measurement allows
for the detection and prioritization of these urgent cases for plugging
and remediation. Finally, methane measurement helps detect potential
water contamination, enhances our understanding of geologic factors
leading to emissions from unplugged wells and the predictability of
future emissions through the increased collection of data, improves the
accuracy of reporting, and helps create jobs for American workers,
particularly those trained using methane measurement equipment and
conducting field assessments.
Elimination of the methane measurement requirement could also
severely undermine the Department's ability to better understand the
magnitude and characteristics of methane emissions from orphaned wells
across all jurisdictions, creating inconsistencies in data collected
from state, private, Tribal and Federal lands. It would also weaken the
Department's ability to make data-driven policy and program
implementation decisions as required by the Foundations for Evidence-
Based Policymaking Act of 2018.
The Department is also concerned about the ambiguity created by
Section 2 as to the purposes for which States may use awarded funds.
Such ambiguity could potentially lead to the use of substantial
portions of grants for activities unrelated to plugging, remediating,
and restoring orphaned wells.
Proposed National Academies Study
The Department supports Section 3, the National Academies Study on
Community Impact of Orphaned Well Grant Program. On July 18-19, the
Department engaged the National Academy of Sciences, Engineering and
Medicine (NASEM) to convene a workshop to discuss existing practices
and standards for plugging orphaned and/or abandoned hydrocarbon wells.
The Department has also engaged NASEM to convene an ad hoc committee of
experts to provide advice to the Department on regulatory, technical,
scientific, and economic considerations for plugging and remediating
orphaned wells, and supports entering into an agreement with NASEM to
study the effect of the plugging and remediation activity on economic
development, housing trends, and other potential benefits.
Conclusion
The Department of the Interior emphasizes the critical need for
continued methane measurements at orphaned wells before and after
plugging. Methane emissions from these wells contribute significantly
to environmental, health, and safety challenges, necessitating accurate
data for effective mitigation. Because H.R. 7053 would eliminate
methane monitoring requirements for grant recipients, the Department
opposes the bill.
Thank you for the opportunity to testify on this bill.
H.R. 8954, Public Land Renewable Energy Development Act
Introduction
Thank you for the opportunity to testify on H.R. 8954, the Public
Land Renewable Energy Development Act (PLREDA). H.R. 8954 seeks to
promote and expedite the development of renewable energy projects on
Federal lands through the distribution of revenues collected from wind
and solar projects in the regions in which projects are located. The
bill also establishes a special account in the U.S. Treasury as a
vehicle to deliver additional conservation and recreational access
funding to Federal agencies, Tribes, states, and counties.
H.R. 8954 aligns with the Biden-Harris Administration's goal to
promote and expedite the responsible development of renewable energy
projects, and we appreciate the work of the Sponsor and the
Subcommittee in advancing legislation that supports this goal.
Background
The BLM manages approximately 245 million surface acres, located
primarily in 12 western states, and approximately 700 million acres of
subsurface mineral estate. The Federal Land Policy and Management Act
(FLPMA) sets forth the BLM's multiple-use mission, directing that
public lands generally be managed for a broad range of uses, such as
renewable and conventional energy development, livestock grazing,
timber production, hunting and fishing, recreation, wilderness, and
conservation--including protecting cultural and historic resources.
FLPMA also requires the BLM to manage public land resources on a
sustained-yield basis for the benefit of current and future
generations.
BLM-managed public lands provide excellent solar, wind, and
geothermal energy potential and are an important component of the
Administration's broader strategy to rapidly reduce U.S. greenhouse gas
emissions by at least 50 percent by 2030 and achieve a carbon
pollution-free electricity sector by 2035. Consistent with the Energy
Act of 2020, the BLM continues to accelerate responsible permitting of
renewable energy projects on public lands. Since January 21, 2021, the
BLM has permitted projects that are expected to provide over 7.3
gigawatts of clean energy--enough to power nearly 2.4 million homes.
These efforts contributed to the Administration recently surpassing the
goal of permitting 25 gigawatts of clean energy projects on BLM-
administered public lands by 2025. In addition to specific project
approvals, the BLM has also leased eight new areas in Solar Energy
Zones with the capacity to generate nearly 2.5 gigawatts of additional
clean energy. Moreover, on May 1, 2024, the BLM finalized its Rights-
of-Way, Leasing, and Operations for Renewable Energy Rule, which will
lower the cost of developing solar and wind projects, improve renewable
energy project application processes, and incentivize developers to
continue to responsibly develop solar and wind projects on public
lands. These changes are expected to translate, over time, to a
reduction in the average cost of wind and solar energy, which will
stabilize or even reduce the cost of energy to consumers, even as the
cost of other energy sources may experience increased volatility.
H.R. 8954, Public Land Renewable Energy Development Act
H.R. 8954 would establish a new revenue distribution structure for
receipts from solar and wind development on public lands. Under the
bill, beginning January 1, 2025, 25 percent of receipts would be
allocated to the state within the boundary of which the revenue is
derived; 25 percent to the counties within the boundaries of which the
revenue is derived, split based on the percentage of land used in each
county; 25 percent to the Secretary of the Interior (Secretary) to
administer BLM's renewable energy program, including actions to
facilitate the processing of renewable energy permits on Federal land;
and 25 percent would be deposited in a new Renewable Energy Resource
Conservation Fund (Fund).
The Secretary would be permitted to make amounts in the Fund
available to Federal and state agencies and Tribes to protect and
restore important fish and wildlife habitat and water resources, as
well as to secure recreational access to Federal lands. The bill also
provides an exception for revenue received from section 504(g) of FLPMA
used for processing right-of-way (ROW) applications, which gives the
Department of the Interior (Department) the authority to collect cost
recovery revenue for the processing and monitoring of ROW applications.
Analysis
The BLM recognizes the interests of states and counties in
receiving additional revenue from local wind and solar projects.
Currently, states and local governments receive revenue generated by a
variety of other activities on public lands--such as states receiving
roughly half of the revenues generated by oil, gas, and coal
development within their borders--and this revenue sharing can help pay
for public services associated with projects on public lands. However,
all revenues from renewable energy development currently go to the U.S.
Treasury. The BLM appreciates the Subcommittee's interest in providing
local communities with benefits from development on public lands in
their jurisdictions. The BLM also appreciates the potential benefits
that could come from the Fund established by the bill, which would
enhance outdoor recreation opportunities and support state and Tribal
wildlife conservation efforts to mitigate potential impacts from
renewable energy development.
Similarly, the BLM appreciates that H.R. 8954 provides an exception
to its revenue allocation for revenue received from section 504(g) of
FLPMA. If enacted, this exception would help ensure continued support
for prioritization of renewable energy and energy transmission permit
processing by retaining revenues received from local ROW grants.
Currently, these funds are placed into a special account in the U.S.
Treasury that the BLM uses to process thousands of ROW applications.
Conclusion
The Department and the BLM are committed to responsibly mobilizing
the tremendous renewable energy resources of our nation's public lands.
We share the Sponsor's and the Subcommittee's interest in supporting
the development of those resources, consistent with environmental
protections and public involvement in agency decision-making. The
Department and the BLM look forward to continuing to work with the
Subcommittee and Congress on these important issues.
______
Questions Submitted for the Record to Dr. Steve Feldgus, Principal
Deputy Assistant Secretary for Land and Minerals Management,
Department of the Interior
Dr. Feldgus did not submit responses to the Committee by the
appropriate deadline for inclusion in the printed record.
Questions Submitted by Representative Westerman
H.R. 7053
Question 1. For the federal and state orphaned wells programs under
the IIJA, is the Department tracking how much of each respective pot of
money is being used on plugging efforts versus the other activities
listed in Section 40601(c)(2)(A) and Section 40601(b)(2)?
1a) If so, please send that breakdown?
Question 2. Why didn't the Department notify states in the
Department's Formula Grant Guidance that the funding would be subject
to Endangered Species Act and the National Historic Preservation Act
requirements?
Question 3. How many wells do you anticipate being plugged by
states using Formula Grant money in FY 1924?
H.R. 8954
Question 4. How much yearly revenue is generated by energy storage
facilities located on federal lands? If energy storage projects
currently under review are approved, how much additional revenue will
be generated?
Question 5. What percentage of wind and solar projects currently
under review at BLM are co located with an energy storage facility? How
does this number compare with standalone energy storage facilities
under review on federal lands?
Question 6. What is the average timeline between the date of
receipt of an application for a Cost Recovery Agreement and approval
for energy projects on federal land since 2021?
Question 7. What is the average timeline between the submission of
a project proposal and a Notice of Intent (NOI) for an Environmental
Impact Statement (EIS) being issued for energy projects on federal land
since 2021?
Question 8. What is the average timeline for completion of an EIS
once an NOI has been issued for energy projects on federal lands since
2021?
______
Mr. Stauber. Thank you very much, Dr. Feldgus. Our last
witness is Mr. Jim Wright. He is the Commissioner of the
Railroad Commission of Texas, and he is based in Austin, Texas.
Mr. Wright, you are now recognized for 5 minutes.
STATEMENT OF JIM WRIGHT, COMMISSIONER, RAILROAD COMMISSION OF
TEXAS, AUSTIN, TEXAS
Mr. Wright. Chairman Stauber, Ranking Member Ocasio-Cortez,
and members of the Subcommittee, thank you for the invitation
to testify before you today about the need for greater state
flexibility within the Department of the Interior's Orphaned
Well Plugging Grant program, and how the legislation introduced
by Representative Thompson, H.R. 7053, the Orphan Well Grant
Flexibility Act, provides that flexibility and would help
achieve our common goal of plugging as many orphan wells as
possible with these taxpayer dollars.
As I discussed in my written testimony, the state of Texas
has a long and successful track record of plugging orphan wells
through our state-managed plugging program. While I am proud of
the work the Commission has been able to accomplish over the
past 40 years, we have more work to do, which is why I am
pleased to see the inclusion of Federal funding for orphan well
plugging included in the IIJA. This funding provides
opportunity to significantly reduce the U.S. orphan well
population, in addition to our existing state funds.
I am proud to report that the state of Texas was able to
successfully deploy the $25 million in funding we received
through the initial grant to plug 730 wells, in addition to the
1,000-plus wells we plugged with state resources. While
deployment of the initial grant funds was effective, the
subsequent formula grant has not achieved a similar level of
success due to additional terms, conditions, and requirements
which increase costs and add significant delays to complete
each plugging.
Put simply, while the initial grant was successful when it
comes to the formula grant, taxpayers are getting less, paying
more, and waiting longer.
One issue is the cost of methane detection and monitoring.
The inclusion by DOI of methane monitoring as a requirement for
receiving formula grant funds can add anywhere from $2,000 to
$5,000 to the average cost. I recognize that, as Members of
Congress, you are likely used to hearing numbers with a few
more zeros behind them, but these are real costs that have a
real impact on the state's ability to plug as many orphan wells
as possible.
For many states with significant orphan well populations,
raising plugging costs by 10 percent means that ultimately
there will be 10 percent fewer wells plugged in our state.
Texas is not alone in this concern. The Interstate Oil and Gas
Compact Commission, as well as the Environmental Defense Fund
both provided feedback to the Department of the Interior as it
was seeking comment on its draft formula grant guidance last
year. Unfortunately, these suggested changes were not included
in the DOI's final guidance.
One thing which I did not include in my written testimony,
but would like to note, is with respect to the ``J'', or
``jobs,'' in IIJA. Following the initial passage of the IIJA,
and as the initial grant funds were being utilized, we saw
significant interest in new entrants into the well-plugging
space. That is no longer the case. Delays in project approvals
due to these new, stringent requirements have led to at least
one company who went out and hired and bought equipment to let
me know they were getting out of the plugging business, selling
the equipment, and letting those new hires go.
If there is one thing you take away from my testimony
today, I hope it is this: When it comes to our nation's orphan
well population, it is important to remember that each orphan
well is different. They are all unique. Age, geological
formation, depth, proximity to groundwater, onshore or
offshore, these wells are as unique as the individual districts
you represent. That is why it is so important states have the
necessary flexibility to determine how best to utilize these
funds. While it may be prudent for some states to perform
methane monitoring, for others the additional cost might be
better served plugging more wells. That is why I am here today,
and I support this bill.
As the deployment of the initial grant made clear, when
given the opportunity states can move quickly to utilize and
deploy these Federal funds in a manner best suited to address
their specific orphan well population.
With that, thank you, and I will be happy to answer any
questions.
[The prepared statement of Mr. Wright follows:]
Prepared Statement of the Hon. Jim Wright, Commissioner, Railroad
Commission of Texas
on H.R. 7053
Chairman Stauber, Ranking Member Ocasio-Cortez, Members of this
Subcommittee, thank you for the invitation to testify before you today
about our experience with the Department of Interior's Orphan Well
Plugging Grant program and how it might be improved.
The Railroad Commission of Texas was established in 1891, making it
the oldest regulatory agency in Texas, and one of the oldest of its
kind in the nation. The Commission is the state agency with primary
regulatory jurisdiction over the oil and natural gas industry, pipeline
transporters, natural gas and hazardous liquid pipeline industry,
natural gas utilities, the LP-gas industry, critical natural gas
infrastructure, and coal and uranium surface mining operations. The
Commission exists under provisions of the Texas Constitution and
exercises its statutory responsibilities under state and federal laws
for regulation and enforcement of the state's energy industries. The
Commission also has regulatory and enforcement responsibilities under
federal law including the Surface Coal Mining Control and Reclamation
Act, Safe Drinking Water Act, Pipeline Safety Acts, Resource
Conservation Recovery Act, and Clean Water Act.
As the members of this panel are no doubt aware, the State of Texas
is the largest energy producer in the nation. We are responsible for
over 42% of all U.S. oil production, and 28% of U.S. Natural Gas
production. Texas contains almost half a million miles of pipeline,
through which energy products travel to reach refineries of which the
state of Texas is responsible for a full third of all U.S. capacity.
Texas State Managed Well Plugging
Like all oil and gas producing states, Texas must contend with a
subset of wells for which there is no viable operator and is thus
considered orphaned.
The Commission maintains oversight over Texas's orphan well
plugging program, which is funded through regulatory fees, permit fees
and bonds paid by the Oil and Gas industry. Since its inception 40
years ago, the Commission's State Managed Plugging Program has plugged
over 45,000 wells, constituting approximately half of all wells plugged
by state programs.\1\
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\1\ Idle and Orphaned Oil & Gas Wells: State and Provincial
Regulatory Strategies, IOGCC 2024
---------------------------------------------------------------------------
Federal Orphan Well Grant Funding
Following the passage of the Infrastructure Investment and Jobs Act
(IIJA), the Commission applied for the first of the three available
funding mechanisms available under the IIJA for orphaned well plugging
and was awarded $25 million through the Initial Grant. I am proud to
report that a few short weeks later, the State of Texas was among the
first in the nation to begin plugging orphan oil and gas wells using
federal grants from the IIJA. Through the first tranche of $25 million
dollars received under the Initial Grant phase, Texas ultimately
plugged 730 wells.
The successful deployment of these Initial Grant funds by Texas and
other states was due in large part to the fact these funds had very
little in the way of new requirements or conditions for recipient
states. That stands in stark contrast to the subsequent Formula Grant
requirements, such as required methane detection and monitoring, and
other prerequisites which I highlight later in this testimony. These
additional requirements have resulted in a substantial increase in the
average cost to plug a well, while simultaneously adding significant
time to complete each plugging job.
Put simply, while the Initial Grant was successful, when it comes
to the Formula Grant, taxpayers are getting less, paying more, and
waiting longer.
Methane Detection & Monitoring Requirements: Additional Cost =
Opportunity Cost
The Commission has repeatedly expressed concerns to The Department
of the Interior (DOI), the federal agency responsible for establishing
rules for the disbursement of funds from the IIJA for plugging of
orphan wells, that requiring methane monitoring as a condition of
receiving federal formula grant funds would result in additional
contracting costs and ultimately result in fewer orphan wells being
plugged.\2\
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\2\ Railroad Commission of Texas: Response to Department of
Interior Draft Formula Grant Guidance, February 24, 2023
---------------------------------------------------------------------------
Texas is not alone in raising this concern. The DOI received
comments from a diverse group of stakeholders in response to the Draft
Formula Grant Guidance published in January of 2023. The Interstate Oil
and Gas Compact Commission (IOGCC), which is composed of 29 oil and gas
producing states, including California, New York, Arizona, Louisiana,
Texas and others which are represented by the members of this
committee, unanimously passed a resolution which called for the DOI to
provide states with flexibility with respect to the formula grants.\3\
The IOGCC resolution states that additional requirements not expressly
required by the IIJA statute will serve to increase the cost to plug an
orphan well, resulting in fewer wells being plugged. Section 40601 of
the IIJA contains no requirement with respect to methane detection or
methane monitoring as a condition of receiving formula grant funds.
This requirement was added as a condition to receive funds in express
contravention of the statutory language which was passed into law. The
statutory language in IIJA affirmatively requires the DOI to consult
with the IOGCC and its member states regarding the implementation and
distribution of Federal Orphan well plugging funds. As a member of that
body, I have found that consultation to be sorely lacking.
---------------------------------------------------------------------------
\3\ IOGCC Resolution 23.053: Urging Congress to Direct the
Department of Interior to Follow Statutory Language in Implementation
of Section 40601 of the IIJA, Interstate Oil and Gas Compact
Commission, May 24, 2023. There were no votes against the resolution.
---------------------------------------------------------------------------
Indeed, other stakeholders shared similar concerns to those held by
the Commission and the IOGCC. The Environmental Defense Fund, for
example, noted in their comments to DOI on March 24, 2023 that ``There
are some requirements in the current draft that would likely
significantly drive up the costs and time needed to plug wells and
could materially reduce the number of wells states will be able to plug
. . . Of particular concern is the requirement to measure and quantify
methane emissions before and after plugging.'' \4\
---------------------------------------------------------------------------
\4\ Environmental Defense Fund: Response to Department of Interior
Draft Formula Grant Guidance, March 24, 2023
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Estimates vary, but the specific costs of monitoring can result in
anywhere from $2,000 to $5,500 dollars in additional expenses. For
context, plugging an onshore well varies due to several factors,
including geographic location, but has averaged anywhere between
$30,000 to $35,000 over the last several years. Simply put, spending
10% or more for methane detection and monitoring means 10% fewer wells
that could ultimately be plugged in Texas. That does not account for
the additional time needed to conduct the pre- and post-testing
requirements, which can also add significant costs.
While this extra expenditure may provide some data, it does nothing
to change the necessary solution, which is to plug the well.
Importantly, several states chose to use the Initial Grant funding
to measure methane emissions, as was within their right in the Initial
Grant. H.R. 7053, the Orphan Well Flexibility Act, simply extends that
optionality for remaining grant funds, consistent with the intent and
text of the IIJA. It bears repeating that H.R. 7053 does nothing to
prohibit states from utilizing federal funds for the purposes of
methane detection and monitoring. However, for states with significant
orphan well populations, the current requirement under the formula
grant to spend additional resources to detect and monitor for methane
at the expense of plugging fewer wells makes little sense. It should
also be noted that these testing requirements mandated by the DOI
requires detection equipment 100 times more sensitive than those
required under the Inflation Reduction Act's Methane Emissions
Reduction Plan (MERP) run by the EPA and the Department of
Energy.5,6 Such a requirement makes little sense and, again,
represents additional and unnecessary costs due to their rigor. This
inflexibility is self-defeating to the underlying goals of the IIJA and
ultimately limits a state's ability to innovate and stretch these
taxpayer dollars further.
---------------------------------------------------------------------------
\5\ Orphan Well Methane Measurement Guidelines (Page 24), U.S.
Department of Interior
\6\ Methane Measurement Guidelines for Marginal Conventional Wells
(Page 9), U.S. Department of Energy
---------------------------------------------------------------------------
Several states have had conversations with plugging contractors and
others about the potential to utilize the voluntary carbon credit
market to offset plugging costs. This could represent a way to lower
the average cost to plug a well, enabling states to stretch these
taxpayer dollars further and ultimately plug more wells. Importantly,
the voluntary carbon credit markets such as the American Carbon
Registry have standards which the DOI itself references in their
methane monitoring guidance materials. Yet, DOI has denied states the
opportunity to further explore this as a novel way to potentially lower
plugging costs and obtain data related to methane emissions.
While this may not be a practical use of funds for some states, for
others it may prove beneficial. Providing flexibility in these Formula
Grants so that states may choose whether, and to what degree, they
conduct methane testing will result in innovative solutions which
directly achieve the goal and intent of Congress through the IIJA.
I support H.R. 7053, the Orphan Well Flexibility Act because I
believe the ultimate success or failure of the program hangs in the
balance. Texas and many other states have proven with the Initial Grant
funding that they are more than capable of being good stewards of
taxpayer dollars and making rational decisions which best serve the
specific needs of their citizenry as well as the orphan well population
in their respective states.
Approval Delays Within the Orphan Well Program Office
While this hearing is focused on providing state flexibility, I
would like to take this opportunity to highlight several other issues
the Railroad Commission has experienced recently as it relates to
burdensome requirements and monitoring efforts which hinders the
Commission's ability to utilize the Formula Grant funds effectively.
The Commission submitted its Phase I Formula Grant on September 21,
2023. Over three months later, on January 11, 2024, the Orphaned Well
Program Office informed those states that submitted a formula grant
application that new terms and conditions would be included in their
Formula Grant awards. One day later, on January 12, 2024, the
Commission received its Phase I Formula Grant award including new Award
Term 25: Endangered Species Act (ESA) Compliance Reviews and new Award
Term 26: Historic Preservation.
The Railroad Commission project period began on February 1, 2024,
with the agency positioned to begin plugging orphaned wells across
Texas immediately, just as it had done with the Initial Grant funding.
Compliance with the new award terms, and the absence of processes
within the Orphaned Well Program Office (OPWO) to implement those terms
delayed well-plugging work until April 8, 2024, when six wells were
finally able to be plugged in Bexar County using Phase I Formula Grant
funds. The addition of ESA Section 7 and National Historic Preservation
Act (NHPA) Section 106 compliance to the award terms and conditions
adds significantly to the oversight activities of the OPWO.
Absent changes to the requirements of ESA Section 7 and NHPA
Section 106, well plugging may be slowed to such a pace that funds may
not be expended before their expiration on September 30, 2030. During
the first five months of the Formula Grant, the Commission plugged
approximately 60 percent fewer wells than were plugged during the first
five months of the Initial Grant (9/22-2/23, 273 wells vs 2/24-6/24,
112 wells).
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Of the $79.6 million awarded to Texas under phase I of the
Formula Grant, the Commission has drawn on approximately $3 million to
date. This is not due to a lack of trying, nor is it for a lack of
wells to be plugged. It is due to significant delays and reviews by the
OPWO with respect to ESA reviews, and compliance with the NHPA.
Endangered Species Act
Compliance with ESA Section 7 delays the implementation of well
plugging activities as the Commission must assess each project area for
applicable species. OWPO has 10 business days to concur with a ``no
effect'' determination made by the Commission, the best-case outcome.
However, the OWPO has, in several instances, rejected the Commission's
``no effect'' determination, and instead directed the Commission to
perform site surveys for specific species or implement other mitigation
measures, extending the timeline indefinitely before a project may
proceed. Should a review result in a ``may affect'' or ``not likely to
adversely'' affect determination, the timeline is significantly longer
as the Commission is required to seek concurrence with the
determination from U.S. Fish and Wildlife Service (USFWS) or the
National Marine Fisheries Service (NMFS). Should formal consultation be
required, the OWPO must submit the initiation package. Award Term 25
indicates that the Railroad Commission may seek technical assistance
from the USFWS or the NMFS. While that assistance was sought from USFWS
in the development of internal processes, assistance has not been
forthcoming in a timely manner.
National Historic Preservation Act
Compliance with NHPA Section 106 adds a minimum of 30 days to each
well plugging project. Award Term 26 describes plugging as
``undertakings'' with the potential to affect historic properties.
Among the requirements for NHPA is the need for a ``Cultural
Monitor'' to oversee well plugging for several wells in plugging
packages submitted to DOI. These are individuals, such as
archeologists, hired to conduct site surveys and monitor the plugging
operations for the unlikely discovery of cultural artifacts during
ground disturbance. These are unplugged orphan wells, which by their
very nature have been disturbed at some point in the recent past by
modern human activity.
Real World Implications
The delays experienced by our staff with respect to these
provisions have had an impact on our ability to plug orphan wells in a
timely fashion. This is especially concerning in emergency situations
and when it is evident that a leak is occurring.
In June of this year, a little over one month ago, the Railroad
Commission was notified about an orphan oil well which was leaking
produced water. The Commission submitted the project to the Texas
Historical Commission for NHPA Section 106 Review, as well as to the
DOI requesting an expedited review of their ESA Analysis. The
Commission received a completed review from the Texas Historical
Commission within 24 hours. The USFWS Official Species List identified
five species as potentially present in the project area. Three species
(Tricolored Bat, Piping Plover, and Rufa Red Knot) only need to be
considered for wind energy projects. The two fish species (Sharpnose
Shiner and Smalleye Shiner) only need to be considered for reservoir
projects or projects that alter the flow of water in rivers and
streams. While RRC staff determined the project would have no effect on
these species, since the plugging job in question did not involve wind
turbines or reservoirs, it took the DOI five days to reach a similar
conclusion before granting the RRC approval to proceed and indicating
standard approval would be forthcoming. Standard approval from the DOI
was received 18 days later.
Earlier this year, the Railroad Commission submitted for approval
an expedited review for a leaking well in Matagorda Bay. On the very
same platform as the well in question were seven additional orphan
wells and one well on an adjacent platform which the Commission wanted
to address simultaneously. Because the leaking well was submitted via
emergency procedures with respect to ESA and NHPA requirements, the
OPWO only initially approved plugging for the one leaking well. The
cost savings of addressing all the wells at once are significant, as
the rig mobilization costs constitute a significant portion of a bay or
offshore well's total plugging cost, which in Texas averages
approximately $500,000 for a bay well and $1,000,000 those further
offshore.
Closing
Again, thank you for allowing me the opportunity to testify on the
Orphan Well Grant Flexibility Act and update the committee you some of
the other issues faced by the Railroad Commission with respect to the
Formula Grant funding and coordination with the OWPO.
As I hope my testimony has shown, providing states with flexibility
will be key to reducing our nation's orphan well plugging population.
It is in America's best interest to use this funding to plug as many
orphan wells as possible, and the best way to achieve that is through
state flexibility.
As the deployment of the Initial Grant made clear, when given the
opportunity, states can move quickly to utilize and deploy these
federal funds in a manner best suited to address their specific orphan
well population.
______
Mr. Stauber. Thank you very much, Mr. Wright. I am now
going to recognize Mr. Wesley Hunt from Texas' 38th
Congressional District for testimony on his bill.
Mr. Hunt.
STATEMENT OF THE HON. WESLEY P. HUNT, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF TEXAS
Mr. Hunt. Thank you, Mr. Chairman, and I want to thank the
witnesses for testifying today. Thank you all so much for being
here.
In 2011, during the Obama administration, BOEM reported 90
billion barrels of oil, and 405 trillion cubic feet of gas, and
162 billion barrels of oil equivalent in the Outer Continental
Shelf. In 2016, also during the Obama administration, BOEM
reported 91 billion barrels of oil, and 328 trillion cubic feet
of gas, and 149 billion barrels of oil equivalent. During the
Obama administration, the numbers did not fluctuate in any
unusual manner.
Let's fast forward to 2021, under the Biden administration.
BOEM reported 68--68--billion barrels of oil and 229 trillion
cubic feet of gas, and 109 billion barrels of oil equivalent.
Now, we can agree that President Trump unleashed American
oil and gas production to levels that no one has ever seen in
this country. It is also true that all of the production that
President Biden touts came off the back of the Trump
administration. But these reported numbers are suspiciously
low, potentially even maliciously low.
From these BOEM-reported numbers came the worst 5-year
leasing plan in our nation's history, offering the lowest
number of offshore oil and gas leases ever. The current 5-year
plan from BOEM offers only three offshore oil and gas lease
sales, despite numerous reports of an increase in U.S. and
global demand for oil and gas. This is why my legislation, the
Comprehensive Offshore Resource Evaluation Act, or the CORE
Act, is so important.
Oil and gas will continue to be an important share of our
energy mix in the future. And if you think otherwise, quite
frankly, you are fooling yourself. Taking politics out of the
assessment process, giving BOEM guardrails and direction is
imperative for the future of our nation and energy production.
And lastly, Section 4 of the CORE Act relates to the
geological and geophysical permitting and surveys, which are
crucial to the exploration and development of offshore oil and
gas resources. Accurate G&G data is essential for identifying
potential deposits, estimating their size, and understanding
their characteristics. Modern seismic imaging reduces the risk
for exploration and production companies by increasing their
likelihood that exploratory wells will successfully tap
hydrocarbon deposits, and decreasing the number of wells
required in a given area.
Undiscovered oil and gas reserves in the Outer Continental
Shelf will significantly boost the U.S. economy. Improving
BOEM's data acquisition methods will prompt an increase in
domestic oil production, which will bring greater energy
security, more affordable energy prices, lower national trade
deficits, and increased revenue passed to the states for vital
coastal restoration and infrastructure projects for the future,
all while producing energy cleaner and in a more responsible
manner from this country. And we do it better than anywhere
else in the world: the Gulf of Mexico production is 46 percent
less carbon intensive than any other country such as Russia,
China, and Iran.
The American people deserve an honest oil and gas
assessment process. With this bill, we can deliver for American
families and for the American public.
Thank you, Mr. Chairman. I yield back the rest of my time.
Mr. Stauber. Thank you very much. The Chair will now
recognize Members for 5 minutes of questioning. I want to first
recognize the Full Committee Chair, Chairman Westerman, for 5
minutes.
Mr. Chair, you are up.
Mr. Westerman. Thank you, Chairman Stauber, and thank you
to the witnesses for being here.
Dr. Feldgus, recently the Supreme Court had the
overturning, essentially, overturning of the Chevron decision
which said that Congress is responsible for making laws, not
agencies in the Administration. So, in requiring states to
conduct monitoring for each orphaned well pre- and post-
plugging, do you believe you are meeting the intent of the law?
Dr. Feldgus. We do absolutely believe we are meeting the
intent of the law, yes.
Mr. Westerman. I would like to cite a statement for the
record provided by one of the bill's sponsors, Senator Cramer.
He says, ``When the bill was introduced, it was clear the goal
was to boost the work of state programs.'' He goes on to quote,
``We intentionally gave more flexibility to state programs with
the word `may' in the list of activities they could carry out.
We knew states already had programs in place to do this work,
and our goal was to inject dollars into their coffers as
quickly as possible to keep these skilled workers employed and
fix the environmental problem at hand.'' And I would like to
submit that quote to the record, Chairman Stauber.
Mr. Stauber. So ordered.
[The information follows:]
Statement for the Record
Kevin Cramer
U.S. Senator
Chairman Stauber, Ranking Member Ocasio-Cortez, and members of the
committee, thank you for holding today's hearing. I write in support of
H.R. 7053, the ``Orphan Well Grant Flexibility Act of 2024,''
bipartisan legislation authored by Representatives Thompson (R-PA-15)
and Deluzio (D-PA-17). According to the sponsor, ``This legislation
removes unnecessary burdens on state agencies regarding certain testing
procedures, which will maximize federal dollars and lead to more wells
being plugged.'' \1\ Put simply, the bill reflects how the underlying
legislation was supposed to be implemented.
---------------------------------------------------------------------------
\1\ https://thompson.house.gov/media-center/press-releases/
thompson-deluzio-introduce-orphan-well-grant-flexibility-act
---------------------------------------------------------------------------
When Senator Lujan and I wrote the Revive Economic Growth and
Reclaim Orphaned Wells Act (REGROW), I was inspired by North Dakota's
decision to utilize CARES Act funding for orphaned well reclamation.\2\
Our state program kept oil and gas workers on the job as they plugged
wells. Senator Lujan and I both saw the potential to replicate this on
a national scale by supplementing state reclamation funding to get more
work done. As our joint summary noted, state and federal agencies had
been plugging and reclaiming these wells with limited funds so our goal
was ``to get funds to states quickly to help unemployed oil and gas
workers'' and address the hazards associated with orphan wells.\3\
---------------------------------------------------------------------------
\2\ https://www.dmr.nd.gov/oilgas/pressreleases/
Oil_and_Gas_Division_Three-Part_Education_
Series_on_Well_Plugging_and_Reclamation.pdf
\3\ https://www.lujan.senate.gov/wp-content/uploads/2021/04/REGROW-
Act.pdf
---------------------------------------------------------------------------
When the bill was introduced, it was clear the goal was to boost
the work of state programs. ``New Mexico is leading the nation on
climate action, and I'm proud to introduce bipartisan legislation to
build on our state's momentum, help slash methane emissions, and create
new opportunities,'' [emphasis added] stated Sen. Lujan. My comments
reflected the same sentiment, ``The REGROW Act would follow our state's
lead by providing states, tribes, and federal agencies the resources
they need to properly plug orphaned wells.'' \4\ [emphasis added]
REGROW allocated the bulk of the money to state programs so they could
get more work done. The bill went to great lengths to provide states
with the flexibility needed to continue their reclamation programs
without federal interference.
---------------------------------------------------------------------------
\4\ https://www.lujan.senate.gov/newsroom/press-releases/lujan-
cramer-introduce-bipartisan-regrow-act-to-clean-up-orphaned-wells-
create-new-jobs-and-opportunities/
---------------------------------------------------------------------------
I frequently remind federal agencies to not impose their mediocrity
on states' excellence. Unfortunately, that is exactly what the
Department of the Interior (DOI or Department) has done with its
implementation of the program.
As a critic of lazy legislating, I make a point of being as
specific as possible in authoring bills. In a July 2022 essay in the
Harvard Journal of Law & Public Policy regarding the REGROW Act, I
stated, ``Throughout the bill writing process, one of my main
priorities was to confine the administration and bureaucracy by clearly
stating our intent in the definition section so we did not defer to
bureaucrats charged with implementation. . . . By using direct language
spelling out deference to existing state policy, future administrations
and unelected career bureaucrats, regardless of the political party, do
not have the authority to set parameters on what constitutes an
orphaned well. This clarity was also necessary to expedite
implementation of the program by circumventing the administrative
rulemaking processes to put unemployed oilfield workers back to work
and remediate the land faster.'' \5\
---------------------------------------------------------------------------
\5\ https://senatorkevincramer.app.box.com/s/
zps5x48c0o3bqrdrjygeker55x5es5eb
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Despite the statute's unambiguity, the administration cannot tell
the difference between ``may'' and ``shall.'' We intentionally gave
more flexibility to state programs with the word ``may'' in the list of
activities they could carry out. We knew states already had programs in
place to do this work and our goal was to inject dollars into their
coffers as quickly as possible to keep these skilled workers employed
and fix the environmental problem at hand. When I testified before the
Senate Energy and Natural Resources Committee on this bill, I said,
``We have kept the main thing, the main thing. Rather than inserting
things into the measure that would divide us we're focused to getting
people back to work and cleaning up the mess.'' \6\ This approach
earned the support from a broad coalition ranging from the
Environmental Defense Fund to the Independent Petroleum Association of
America.
---------------------------------------------------------------------------
\6\ https://www.cramer.senate.gov/news/press-releases/sen-cramer-
testifies-on-his-bipartisan-orphaned-wells-bill-at-senate-energy-
subcommittee-hearing
---------------------------------------------------------------------------
Separately, we had a specific section in the bill dedicated to
Performance Grants designed to incentivize states to take added fiscal
and environmental actions with their programs. These are optional
grants a state could pursue to refine or improve their operations, not
additional mandates.
Somehow, despite the clarity, DOI is layering its cumbersome
mediocrity onto state programs. When states apply for a Formula Grant,
DOI's guidance requires a plan to measure and track methane emissions.
Even though the law clearly says ``may:'' ``IN GENERAL.--A State may
use funding provided under this subsection for any of the following
purposes: . . . (I) emissions of methane and other gases associated
with orphaned wells.'' \7\ [emphasis added] Some states who have done
methane tracking with their initial grants had to spend thousands of
extra dollars per well, adding to the cost of an already expensive
process. Now, each state is forced to debate whether to invest the
additional time and resources into complying with this mandate for
their formula grants even though the law does not require it. Those
that refuse have had their application rejected. DOI is also requiring
states to perform National Historic Preservation Act and Endangered
Species Act consultations.\8\ The REGROW Act makes no mention of either
of these statutes, yet the Department has rendered these complex
consultations mandatory despite the fact the land in question is
already disturbed. Some states are now backing away from taking the
funds, because the requirements outweigh the benefit. The juice is not
worth the squeeze. DOI has also taken the liberty of turning the
Formula Grant into a series of awards. Despite DOI already announcing
how much each state is eligible to receive and saying the formula will
not change, it is requiring them to apply and reapply for each
tranche.\9\ Yet again, this requirement is not written anywhere in what
Congress passed. In fact, when describing the application process for a
formula grant, the bill specifically uses singular terms, ``To be
eligible to receive a formula grant under this paragraph, a State shall
submit to the Secretary an application that includes . . .'' \10\
[emphasis added] This phased approach harms state's planning and
contracting ability and requires extra resources and time for each
application.
---------------------------------------------------------------------------
\7\ https://www.congress.gov/117/plaws/publ58/PLAW-117publ58.pdf
\8\ https://www.doi.gov/sites/default/files/documents/2024-05/owpo-
may-2024-formula-and-matching-grant-faqs.pdf
\9\ https://www.doi.gov/media/document/faqs-formula-grants-07-07-
2023-pdf
\10\ https://www.congress.gov/117/plaws/publ58/PLAW-117publ58.pdf
---------------------------------------------------------------------------
Each of these hurdles is an impediment, not a solution. And each
denial or delay means an environmental hazard continues marring land
that could be productive or preserved.
The intent of REGROW was to move funds as quickly as possible to
resolve hazards on the ground. Lest we forget, when the bill was
passed, there were more than 56,000 orphaned wells across the country.
When states are reluctant to participate or DOI is slow to release
funds, these hazards are perpetuated. For example, Texas, one of the
most active and engaged states, has plugged 60 percent fewer wells in
the first five months of the Formula Grant than the Initial Grant.
Similarly, as of early July, some states with the largest backlogs,
including Pennsylvania and New Mexico, have not even been awarded a
first phase of formula grants yet. For context, just those two states
are eligible for nearly $400 million.\11\ That is $400 million sitting
in the bureaucracy rather than states getting people to work to clean
up the mess.
---------------------------------------------------------------------------
\11\ https://www.doi.gov/pressreleases/biden-harris-administration-
invests-660-million-states-plug-orphaned-oil-and-gas-wells
---------------------------------------------------------------------------
I support Representative Thompson and Deluzio's bipartisan Orphan
Well Grant Flexibility Act, but if DOI followed the law, it would not
be necessary. A basic reading of REGROW shows the Department is taking
liberties Congress never authorized. As the U.S. Supreme Court has
pointed out in both West Virginia v. EPA and Loper Bright Enterprises
v. Raimondo, federal bureaucrats are confined by the law. They cannot
wish their preferences into statute. Furthermore, the Court has made
clear: the absence of a prohibition is not a license. If authority was
not given, the bureaucracy cannot take it. I support Congressman
Thompson's bill to once again tell DOI these activities are not
required for the states as they manage their programs.
______
Mr. Westerman. So, Dr. Feldgus, will you commit to fixing
the formula grant guidance to meet the intent of the law?
Dr. Feldgus. Well, I do think we are meeting the intent of
the law with the current guidance.
Mr. Westerman. Can you elaborate on that?
Dr. Feldgus. Sure. We think that methane reduction is one
of the key goals of that section. It is in the title. It is the
only section in the title that is called methane reduction
infrastructure. And also, our report to Congress that will be
due requires us----
Mr. Westerman. Wouldn't plugging more wells prevent more
methane emissions?
Dr. Feldgus. Well, if we measure the methane that we are
plugging, then we would know that, yes.
Mr. Westerman. But if the well is plugged, you are not
emitting methane, are you?
Dr. Feldgus. Well, ideally----
Mr. Westerman. Does it matter if you measure pre-plugging?
I could see measuring post-plugging, but why do you need to
measure pre-plugging?
Dr. Feldgus. Well, we need to measure it in order to be
able to, first of all, know how successful the program is;
also, to know what the risks are of particular wells, knowing
which might be emitting more methane versus less methane. There
are multiple reasons why it is very useful to have that data.
Mr. Westerman. But would you save money by maybe not
plugging if it is not emitting much methane?
Dr. Feldgus. I mean, it would always save money if you did
not plug the well, certainly.
Mr. Westerman. What is the purpose? Isn't the intent of the
law to plug wells? I don't see in the law where it says to go
measure the methane before you plug the wells, and we have
heard testimony that it is costing more money. So, the program
is not going to be as effective because you have added on to
the intent of the law.
Mr. Van Liew, we know that clean-burning U.S. natural gas
has done more to offset global carbon emissions than any other
program that is out there. And we also know it is orders of
magnitude that has more potential to reduce greenhouse gas
emissions than things like electric vehicles that the Biden-
Harris administration have pushed so hard. Yet, there seems to
be an attack on producing clean, U.S. natural gas, and even a
bigger attack on exporting that gas to our allies around the
world. And Vladimir Putin seems to be filling that void with
his production.
So, how would Representative Hunt's CORE Act ensure that
future 5-year plans include more lease sales?
And what mechanisms are included in the bill to prevent
future administrations from reducing these opportunities,
considering the vast untapped potential of our offshore
resources?
Mr. Van Liew. Thank you for the question. I am not sure
that the bill directly requires an increase in the 5-year plan
for leasing areas, but it better informs the government and the
citizens of the United States when 5-year plans are being
developed as to where resources may exist through geoscience
surveying, and also where those resources may not exist. So,
not only does it focus on areas where we can lease and add
leased areas, but it also looks at areas that may not be useful
for leasing.
And to your point on the lowest carbon intensity barrels,
among the lowest in the world, we should be expanding on the
use of our own resources to reduce carbon intensity globally.
Mr. Westerman. And that leads into my next question. I
talked about the cleanliness of U.S. gas, but the CORE Act
mandates the determination of net greenhouse gas emission
reductions if domestic oil and gas replace imports.
Again, given that the U.S. oil and gas production is
already 46 percent lower in greenhouse gas emissions compared
to global averages, how will producing our offshore resources
domestically lead to significant environmental benefits?
Mr. Van Liew. I appreciate the question, and that is why we
are supportive of Mr. Hunt's bill in requiring the government
to do that analysis so we can make informed decisions in the
United States about what impacts we will have compared to the
world based on our barrels compared to importing foreign gas
and oil to the United States.
Mr. Westerman. Thank you.
I yield back.
Mr. Stauber. Thank you very much, Chair Westerman. I will
now yield 5 minutes to the Ranking Member, Representative
Ocasio-Cortez.
Ms. Ocasio-Cortez. Thank you so much, Chairman, and I would
like to thank all of our witnesses for joining us here today
and offering their expert testimony.
During this transition from fossil fuels and a
predominantly fossil fuel-reliant economy to the transition to
renewable and clean energy sources, one of our essential
focuses is making sure that oil and gas workers are not left
behind. And it is particularly important in areas where the
industry provides an enormous amount of jobs for the local
communities. Geothermal energy has its own unique potential to
support workers in the transition to clean energy.
Ms. Rogers, can you tell us more about how geothermal
energy creates opportunities for those who have worked in the
fossil fuel industry?
Ms. Rogers. Thank you for the question. You are absolutely
right. The overlap between the oil and gas and power industry,
and the talent set needed in geothermal is a nearly complete
match. It is uncanny, but not coincidental. In the subsurface,
we use the same reservoir engineers, geoscientists, and rig
operators. In the surface, the plant looks like any other power
plant, moving steam through turbines. So, we are using the same
talent sets that you would see, control room operators or
electricians. And that is not even including the downstream
applications of contractors needed to keep these facilities
operating 24/7.
The liftoff report of 2023 indicated that there are more
than 300,000 of these workers ready to take these positions
today. You won't be surprised, then, when I also tell you that
some of the start-ups that are actively pursuing next-
generation geothermal techniques are coming from people that
used to work in the oil and gas industry.
If I may, though, one final point is it is not just the
talent set that these organizations, the existing energy
industry, can offer. They are uniquely positioned in the world
with their rig deployment, with their subsurface data, with
their access to a complex network of service providers to
actually move and commercialize at a pace that matters for
climate. And that is exactly what this bill does.
Ms. Ocasio-Cortez. Thank you. And I understand that
supercritical or superhot rock geothermal also has unique
potential to provide significant, firm, baseload power with
minimal emissions and a relatively small footprint. Can you
talk a little bit about what supercritical geothermal is and
how this kind of energy can complement and fit in the mix of
other sources of renewable energy?
Ms. Rogers. Absolutely. As you pointed out, I believe that
many of the climate benefits here are natural byproducts of
what we are actually producing: 24/7 reliable energy that is
inexhaustible.
Now, the value of pivoting into often deeper, but most
importantly, higher temperature, is that you increase the
energy density. This has always been the goal since the
beginning of time, and energy density drives lower costs. We
believe, according to our models, that with the proper
investment in R&D like new metals and casings, that we should
see a price that is competitive in unsubsidized markets with
fossil fuels today.
Ms. Ocasio-Cortez. Thank you. And lastly, one of the things
I have been very encouraged about, even in this term, is how
geothermal is emerging as a bipartisan priority, and how we are
seeing a lot of common cause across the aisle in trying to
encourage the development of geothermal. So, to that end, and
in that spirit, in looking at the landscape of legislation
today, what we are considering today, and also more broadly, if
there were areas that you would improve upon this legislation,
or additional areas that you would encourage us to take a
deeper look at, what would those points be?
And from your vantage point as an expert, what are some
different things that we should make sure that we have an eye
out for?
Ms. Rogers. Thank you for the question.
I want to emphasize the word R&D, the research and
development necessary here. The work that is being suggested is
the work that is necessary to fill some of the gaps that
naturally occur due to the expertise here. These are not
breakthroughs. These are engineering iterations. So, for modest
investment we can unlock significant, to put it into context,
pizza ovens operate at higher temperatures than what we are
suggesting. But this bill signals the value of the market, and
we are confident. Thank you very much.
Ms. Ocasio-Cortez. Thank you.
Mr. Stauber. Thank you very much. I will now recognize
myself for 5 minutes.
Dr. Feldgus, doesn't every additional requirement for this
funding in the Department Orphan Well Grant program mean higher
costs and longer timelines, thus less wells plugged?
Dr. Feldgus. Well, I will say that we operate under a
number of requirements. There are other Federal laws that need
to be adhered to when wells are being plugged. There are also
general grant requirements for any recipient of a Federal
grant. So, there are a whole web of requirements for grant
recipients.
Mr. Stauber. I would like to cite the Environmental Defense
Fund's comments on the formula grant guidance, where they
flagged this as an issue. They said, ``There are some
requirements in the current draft that would likely
significantly drive up the cost and time needed to plug wells
and could materially reduce the number of wells states will be
able to plug within the budget and time frame of the formula
grants. Of particular concern is the requirement to measure and
quantify methane emissions before and after plugging. It is
premature, given the state of the science and of the methane
measurement industry to require states to quantify methane
emissions from every orphan well with a methane show.''
They end by recommending that the Department work with the
IOGCC to find a cost-effective solution. Did the Department do
so?
Dr. Feldgus. We are currently working with the IOGCC on a
number of aspects of the orphan well program. We just conducted
a webinar last week for guidance on methane measurement, and we
also have the Department of Energy researching new methods, new
cheaper ways to detect methane from orphan wells.
Mr. Stauber. Mr. Wright, do you believe the Department
listened to IOGCC and the states to find cost-effective
solutions?
Mr. Wright. No, I wouldn't be sitting here today if I
believed that.
Mr. Stauber. Elaborate.
Mr. Wright. We have held several meetings with the
Department of the Interior at the Interstate Oil and Gas
Compact Commission, expressing some of the concerns that we saw
and in what was being talked about, especially in methane
measurements. Some of these provisions that we have seen coming
out of DOI really didn't become aware to us until the day we
actually received the formula grant funding.
So, what I am talking about in my testimony today are some
of the hindrances that we are having of actually using and
being responsible with taxpayer dollars. And the only
technology that I am aware of that would take care of those
concerns and issues is plugging the well.
Mr. Stauber. How many additional wells do you think you
could plug if these monitoring requirements were optional, as
the law intended?
Mr. Wright. Our estimate with the grant funding that we
were allotted, our original intent was to plug 1,000 wells in
our fiscal year, but it was not until half of the year had gone
by before we received any funding. So, half a year would equate
to 500 wells. And now that the ESA and the NEPA is part of the
requirement, we are hoping that we can get 200 wells plugged by
the end of our fiscal year.
Mr. Stauber. So, the bureaucratic red tape has caused the
reduction in orphan wells being plugged. Would that be correct?
Mr. Wright. Certainly.
Mr. Stauber. Thank you.
Mr. Van Liew, the CORE Act emphasizes the use of advanced
geophysical and geotechnical data. How will these technologies
enhance our ability to identify and quantify undiscovered
resources, and what impact will this have on our future energy
security and our economic growth?
Mr. Van Liew. Thank you for the question, Mr. Chair.
Our members really are technology companies, advanced
technology companies, using some of the biggest computing
systems in the world, second only to the U.S. Government as
they analyze what the data shows from acquiring geoscience
survey data offshore to better image the resource. And many of
the areas of our OCS are outdated in what that data is and what
those images are.
So, Mr. Hunt's bill would actually incentivize compiling
new and acquiring new geoscience data to create new, advanced
images, including the use of machine learning and AI, and
otherwise to better inform where those resources may exist.
Mr. Stauber. Thank you very much.
Mr. Sandberg, how will the revenue sharing program
established under PLREDA help address challenges faced by state
and local governments that have significant amounts of Federal
lands in their borders?
Mr. Sandberg. I think the revenue sharing pieces are
critically important, as we have said in our written testimony
and one of the principal parts of this bill. And it actually
does provide for the economic development resources to both
state and local communities to benefit from these projects. And
I think that is probably the principal benefit of the PLREDA
and the revenue allocations.
Mr. Stauber. It is kind of like the Good Neighbor Authority
in timber harvesting, a very beneficial program.
My time is up, and I am yielding. I will now recognize
Representative Kamlager-Dove for 5 minutes.
Ms. Kamlager-Dove. Thank you, Mr. Chair. I would like to go
back to the topic of the orphaned wells, and I have some
questions for Dr. Feldgus.
Orphaned wells are incredibly important to me. As everyone
on this Committee has heard, I represent Los Angeles, which
also includes the Inglewood oil fields, and we have orphaned
wells and active wells all throughout Los Angeles that really
are wreaking havoc on the health of so many Angelenos.
The methane emissions reduction provision of the
Infrastructure Investment and Jobs Act actually provides $4.275
billion to states to clean up orphaned oil and gas wells. And
the law requires states to test for methane emissions from
these orphaned oil and gas wells as a condition of grant
eligibility.
Under the same authority, the Department of the Interior is
requiring states to prioritize cleaning up orphan wells within
half a mile of communities of color, low-income, and Indigenous
communities. H.R. 7053 would make this emissions testing and
prioritization of environmental justice communities optional
for states receiving Federal grant dollars. So, while it is
important to get the money out of the door and put it to good
use plugging orphaned wells quickly, these studies and
prioritizations are critical.
Dr. Feldgus, why did the DOI decide to require these
methane emissions studies?
And why is this data valuable enough to spend time and
money collecting it?
Dr. Feldgus. Thank you for the question.
Part of it was understanding the purpose of that section of
the law. It was the only section in a title called Methane
Reduction Infrastructure. And we are required to report to
Congress the amount of methane that was eliminated by the
program. So, very important in order to meet our
responsibilities under the Act to have states measure methane
both before and after.
Also, methane measurement afterwards is critically
important to understand that the plugging job has been done
correctly, that the well has been sealed, and that there is
nothing leaking. If the well wasn't leaking beforehand, the
state does not need to measure the methane, they just can go
ahead and plug it. But it is very important to measure the
effectiveness of the program and the impact that we are having
on local communities by reducing that methane into the
atmosphere.
Ms. Kamlager-Dove. So, I would say that the short answer is
holding everyone accountable, and we certainly want that. That
is something we hear about often, even from the other side of
the aisle. I don't know why they don't want it in this case.
H.R. 7053 specifies that states may use methane emissions
estimates instead of actual measurements at individual orphaned
wells if the state chooses to track methane emissions at all.
So, why do DOI guidelines require methane emissions
measurements and not estimates?
Dr. Feldgus. Because right now there is no good methodology
for estimating methane emissions from orphan wells. We are
working on that. The U.S. Geological Survey has done quite a
bit of research on that.
But in order to develop a good methodology, they need more
data, and that is one of the things that we will be getting
from the methane measurements before and after the wells are
plugged is that data that will help feed into a model that then
states could use for estimation.
Ms. Kamlager-Dove. Thank you. So, tell me, Dr. Feldgus,
what do we know about the other kinds of pollution associated
with orphaned wells that are leaking methane?
And tell us, what does this pollution do to the health of
people living near these wells, people like my constituents?
Dr. Feldgus. Sure thing. With methane, you also have other
volatile organic chemicals, other organic compounds that can go
into the atmosphere, sometimes benzene, toluene. Some of these
molecules are carcinogens. Other times you end up with
molecules that can lead to ground level ozone, which then
exacerbates or causes asthma in local communities.
Ms. Kamlager-Dove. Thank you for that.
I know my colleagues across the aisle claim that going to
offshore oil and gas, that these resource assessments informed
an ``abhorrent 5-year plan.'' So, Dr. Feldgus, in addition, in
the time you have remaining left, which I guess is my time, in
addition to resource assessments what other calculations and
assessments went into the 5-year plan?
Dr. Feldgus. Thank you for the question.
There are a lot of different parameters that go into
developing the 5-year plan. The resource assessments are one of
them, but there is a whole set of issues lined out in Section
18 of the Outer Continental Shelf Lands Act. And in developing
a 5-year plan, the Secretary balances those, and then BOEM
tries to present to the Secretary the combination of sales that
will have the greatest net benefits to society. So, there are a
lot of factors, more than just the inventory of resources.
Ms. Kamlager-Dove. Thank you for that.
With that, Mr. Chair, I yield back.
Mr. Stauber. Thank you very much. I now recognize
Representative Gosar from the great state of Arizona for 5
minutes.
Dr. Gosar. Thank you, Mr. Chairman.
Mr. Sandberg, this revenue sharing process, can you give me
a little about how you feel about that? Do you feel it is the
right way, the right levels across the board?
Mr. Sandberg. It does. I think it is an important step, and
I think that it feels as it is bringing in, I think especially
impactful in two ways.
One is the sharing with local communities. I think it
creates a supportive ecosystem for these projects. As the Chair
said, kind of the good neighbor. It allows them to benefit in
material ways and in ways that other energy resources being
developed on Federal lands, or providing those same benefits.
So now, from that perspective, I think it is good.
I think it also helps in a material way in that one of the
reasons I think that developers sometimes shy away from Federal
land development is because of how long it takes when compared
to what they do on private land. So, I think providing
additional resources to the agencies processing these permits,
it creates a direct line of benefit to the projects, and pushes
them along.
Dr. Gosar. Well, we had this idea that you would actually
go out as an agency to look at the environments that you are
looking at, and identify areas that would be for wind, and
solar, all sorts of different things, so help to streamline it
that way.
Dr. Feldgus, do you feel that the revenue sharing is
adequate across the board?
Dr. Feldgus. Well, certainly, it is up to Congress to
determine what feels adequate in terms of sharing for states
and----
Dr. Gosar. No, but your feeling. What is your feeling?
Dr. Feldgus. I think it would be very helpful for states
and counties. Certainly, when renewable energy projects are
proposed, there are certain burdens on states and counties
planning for the new infrastructure, perhaps accommodating a
new workforce, new residents. So, certainly, I think that
funding would be very helpful for them.
Dr. Gosar. Do you know where this came from? SNPLMA. Good
old Harry Reid had a sharing process because Las Vegas was
landlocked. He figured out a way to get the generation of those
fees to split with the land. And it was very, very successful.
So, just FYI.
I am very interested in your paper here, because for a long
time I talked about geothermal. I am from western Wyoming, and
we had that big caldera called the Yellowstone Caldera. So,
this is very interesting to me. How long do you think it would
take to get something that would be like nuts and bolts, like
you go to a hardware store, you could put something together.
How long would it take? And do you see it ever going that way?
Ms. Rogers. May I ask one clarifying question? Are you
asking about the project timeline from tip to tail on a given
kind plant?
Dr. Gosar. Yes.
Ms. Rogers. OK, got it. We anticipate that you should be
able to construct a plant within 12 to 18 months. I think that
it very much depends on the availability of rigs, how many rigs
you can deploy at the same time, and adequate planning in
advance. I think an expedited schedule could be something as
short as 9 months.
Dr. Gosar. Let me ask you another question. Because we have
a lot of geothermal on the eastern side of Arizona, could you
see this being like mini power plants for, like, a group of
houses out in the middle of the boondocks?
Ms. Rogers. It is a fascinating concept. While I see no
reason not to, one of the major benefits of what supercritical
can unlock is a cost point that is competitive due to the scale
of the plant. So, this is not to say that you couldn't, but
that much of the balance of plant costs will be covered in
larger facilities. So, things like the cooling tower and the
turbine would then be made smaller, and therefore you may not
get the same price point you would otherwise.
Dr. Gosar. Do you see any downturn or downfall of this new
technology?
Ms. Rogers. At this point I see a huge gap between demand
and our ability to fill it, and this is a really important
arrow in our quiver to be able to add more energy to the grid
when we need it.
Dr. Gosar. With my last few seconds, Dr. Feldgus, I am a
mining guy. I want to see us clean up those abandoned mines. We
have always come back to the Good Samaritan law, and it is not
good enough. Is there a way that you can kind of from your
perspective look at this so that we can get the biggest bang
out of the buck?
I mean, I live in Arizona, so we have tons of this. I agree
with the gentlelady from Los Angeles. There has to be
repercussions. A lot of this stuff we can't catch up on, but
there is so much that can be done. If you look at Resolution
Copper, they have cleaned up. They spent over $2 billion
cleaning up that site that was mined for over 100 years. Can
you give me some ideas on that?
Dr. Feldgus. Well, certainly the Administration supports
Good Samaritan legislation. We have put that out in the mining
report that we released last year.
We are also very interested in finding sources of funding
for hardrock abandoned mine cleanup. One potential source would
be excess claim maintenance fees. Currently that money is used
to fund the BLM hardrock mining program, but the rest goes back
to the Treasury. There is a potential to use some of that for
hardrock cleanup and for other purposes. And those are just two
examples.
Dr. Gosar. Thank you.
My time is up, sorry. I yield back.
Mr. Stauber. Thank you very much. The Chair now recognizes
Representative Levin for 5 minutes.
Mr. Levin. Thank you, Mr. Chairman, and thank you for
including such an important piece of legislation, the Public
Land Renewable Energy Development Act, or PLREDA, in today's
hearing. This bill would help to bring renewable energy
development up to par with other energy development on our
public lands by creating a revenue sharing structure similar to
the one that already exists for oil and gas development.
Since no revenue sharing system exists for renewable
energy, all the funds for renewable energy development on our
public lands just go straight to the Treasury. But this bill
recognizes and tries to correct for the immense missed
opportunity to support local and state economies through
renewable energy revenue. This bill would ensure that states
and counties get a fair share of revenues from energy projects
developed in their communities, while providing the Bureau of
Land Management with a stable source of funding to support the
timely processing of permits and directing some funds toward
the conservation of our great natural and cultural resources.
I am glad there is bipartisan support for a policy to
establish revenue sharing for renewables, ensuring parity with
fossil energy. While this is certainly a step in the right
direction, there is still significant work to be done to
support the responsible siting and permitting of renewables on
our public lands. I have introduced my own version of PLREDA,
H.R. 9012, which not only includes revenue sharing, but also
supports a smart-from-the-start approach to development, which
directs projects towards non-sensitive areas and supports
faster permit approvals in those priority areas.
Given that BLM has recently surpassed its goal to permit 25
gigawatts of renewable energy by 2025, which I am pleased to
hear about, I think it is time we set a new goal of permitting
60 gigawatts by 2030. My bill would do just that.
Additionally, my bill supports the timely and efficient
processing of permits for wind and solar energy development
while maintaining key environmental protections by clarifying
agency roles, responsibilities, timelines, and processes, and
providing for increased economic certainty for developers.
I am pleased that conservation groups and clean energy
companies and associations have come together to support this
comprehensive version of PLREDA that ensures we are not just
building out our energy future, but also doing so in a way that
protects our nation's most treasured resources.
And I would like to submit for the record these letters of
support for PLREDA.
Mr. Stauber. Without objection.
[The information follows:]
EDF RENEWABLES
July 23, 2024
Hon. Bruce Westerman, Chair
Hon. Raul Grijalva, Ranking Member
House Natural Resources Committee
1324 Longworth House Office Building
Washington, DC 20515
Hon. Pete Stauber, Chair
Hon. Alexandria Ocasio-Cortez, Ranking Member
Energy and Minerals Subcommittee
1324 Longworth House Office Building
Washington, DC 20515
Dear Chairs and Ranking Members:
On behalf of EDF Renewables, I write in support of H.R. 8954. We
appreciate the committee's consideration of this legislation.
H.R. 8954 addresses the problem that rent and fee payments from
wind and solar projects on Bureau of Land Management (BLM) lands go
entirely to Washington, D.C., and none of those payments go to the
local community. That is in stark contrast not just to geothermal, oil
and gas operations on BLM lands, but also to the typical revenue
streams to local governments from wind and solar projects on private
lands.
We note that the American Southwest, including Arizona, Nevada and
California, is the home of the best solar insolation in the nation,
ranking fourth, fifth and first respectively in the nation in solar
generation capacity as of Q1 2024 according to the Solar Energy
Industries Association. The desert Southwest will continue to attract
interest for new solar as electric utilities seek low-cost power for
its customers amid rising demand for electricity nationwide. That
demand makes H.R. 8954 particularly important to ensure that those
communities in the Southwest and other renewables-rich parts of the
West receive robust, project-based revenues just as they would if the
project was on local private land.
In addition to revenue sharing policy as proposed in H.R. 8954, we
also recommend the committee to consider reforming wind and solar
permitting policies on federal lands as proposed in H.R. 9012. The bill
applies practical approaches to the permitting of renewable energy on
federal lands so that projects can move forward in a timely and cost-
effective manner. For example, it applies timelines for the first two
key milestones for project permitting, while still maintaining
reasonable and meaningful agency review. It also clarifies the role of
Renewable Energy Coordination Office staff, consistent with many
expectations upon the creation of that role within BLM. These
provisions among others maintain the important controls on project
permitting that heed biological, geological, community, cultural and
multi-use imperatives.
EDF Renewables has extensive experience building and operating
renewable energy projects on federal lands, including the 234-MW Switch
solar project in operation in Clark County, Nevada, and the 214-MW
Desert Harvest project in operation in Riverside County, California. If
the revenue-sharing provisions in H.R. 8954 were in effect when those
projects became operational, then the projects would have provided
$13.2 million in funds to county and state governments over their
contracted lives. Instead, those funds and more go entirely to federal
coffers.
We thank you for your ongoing work on delivering energy benefits to
all American communities. As a company that has operated and built
renewable energy projects in the U.S. for almost 40 years, we at EDF
Renewables commit ourselves every day to work safely and in balance
with natural, cultural, and community imperatives. Please see us as an
ongoing partner to support responsible energy policy.
Sincerely,
Virinder Singh,
Vice President, Regulatory & Legislative Affairs
______
July 22, 2024
Hon. Pete Stauber, Chair
Hon. Alexandria Ocasio-Cortez, Ranking Member
House Natural Resources Committee
Energy and Minerals Subcommittee
1324 Longworth House Office Building
Washington, DC 20515
Dear Chairman Stauber, Ranking Member Ocasio-Cortez, and members of
the House Natural Resources Subcommittee on Energy and Mineral
Resources:
On behalf of the undersigned organizations, we write today in
support of two bills, both entitled the Public Land Renewable Energy
Development Act (PLREDA) of 2024--H.R. 8954, which is slated to be
heard by the subcommittee on July 23, 2024, and H.R. 9012, which was
introduced on July 11, 2024. While both bills facilitate the
responsible buildout of renewable energy on public lands, we urge the
subcommittee to consider amending H.R. 8954 to include essential
provisions from H.R. 9012 before moving it forward.
Our federal public lands boast some of the nation's greatest solar,
wind and geothermal potential--and investments in harnessing this
potential continue to grow: in April, the Department of the Interior
surpassed the congressionally-enacted goal of permitting 25 gigawatts
of renewable energy onshore by 2025. Solar, wind, and geothermal
development on public lands powers millions of homes across the West,
sustains thousands of jobs, and returns tens of millions of dollars to
the federal treasury each year. Together, H.R. 8954 and H.R. 9012 can
sustain this growth, create jobs across the West, and bring new revenue
streams to states where these wind, solar, and geothermal projects are
built while ensuring responsible siting for these projects.
This growth has been made possible thanks, in part, to the tireless
efforts of Republicans and Democrats in both chambers: provisions of a
prior iteration of PLREDA became law in the year-end omnibus in FY 2021
(Energy Act of 2020, Title III, Subtitle B), which set the onshore
permitting goal, established Renewable Energy Coordination Offices to
help make the permitting process more efficient, and empowered the
Department to further lower costs.
But this rapid solar, wind, and geothermal growth must be
accompanied by additional policy changes to ensure communities stand to
benefit and to address any impacts development will have on our public
lands and the wildlife, habitats, ecosystems, and cultural resources
they hold.
First, we support sharing wind and solar revenues, as stipulated by
H.R. 8954 and H.R. 9012. Under current law, 100% of rents, fees, and
other revenues generated from wind and solar energy projects are
invested in the federal treasury. By comparison, federal statutes
dictate that oil and gas revenues must be shared with states, and that
geothermal revenues must be shared with states and counties.
Critically, both bills would address this inequity by reinvesting
revenues from renewable energy projects back into states, counties,
into permit processing at the Bureau of Land Management, and into
conservation. Both bills establish a conservation fund to help restore
and protect fish and wildlife habitat, help connect Americans to the
outdoors, and support local stewardship projects oil our public lands.
Second, we support increasing the statutory renewable energy
onshore permitting goal for public land, considering the 25 gigawatt by
2025 goal has been reached. H.R. 9012 proposes a goal of permitting 60
gigawatts by 2030. We support this goal because it will enable further
administrative action, if needed, to ensure responsible utility-scale
deployment of renewable energy continues apace.
Third, we support elements in H.R. 9012 that guide renewable energy
development toward low-conflict areas. Specifically, the bill will
provide for efficient permitting for projects sited in places that have
high-energy potential that may also be proximate to transmission or
that have been previously disturbed or degraded--and where wildlife,
habitat, and cultural resource impacts are minimal. The upfront
planning and careful siting of renewable energy projects that H.R. 9012
envisions will improve projects' permitting timelines, limit adverse
impacts, ensure their durability and longevity going forward, and help
increase revenues to states envisioned by H.R. 8954.
Finally, we would be remiss not to mention the longstanding
bipartisan work over many years to advance provisions addressing
programmatic planning, permitting efficiency, statutory permitting
goals, and industry incentives--including H.R. 3794 from the 116th
Congress, which was unanimously approved by the House Natural Resources
Committee. H.R. 9012 carries these important concepts forward in
language endorsed by organizations representing conservationists,
sportsmen, outdoor recreation. enthusiasts, and renewable energy
industry actors alike, with key updates to meet the challenges and
opportunities of today. We strongly urge you to include these
provisions in H.R. 8954.
In sum, we urge you to support both versions of PLREDA--H.R. 8954
and H.R. 9012 alike--and encourage the subcommittee to include elements
of H.R. 9012 within H.R. 8954 as the latter bill navigates the
legislative process. We look forward to working with you on this
legislation and appreciate your continued support.
Sincerely,
Backcountry Hunters &
Anglers Nevada Wildlife Federation
Friends of Basin and Range The Wilderness Society
National Audubon Society Trout Unlimited
Natural Resources Defense
Council
______
Mr. Levin. Thank you.
Mr. Sandberg, as I am sure you are aware, we talk a lot
about permitting reform in Congress these days, and I know that
the American Clean Power Association has recommended that
Congress expedite the permitting process for clean energy
development on public lands, and that we direct agencies to
make use of programmatic approaches to permitting and
environmental reviews to incentivize projects in areas with
minimal conflicts.
Today, as we are considering ways to support energy
development on public lands, how would pairing revenue sharing
with programmatic NEPA reviews on public lands for renewable
energy help to unlock American energy independence?
Mr. Sandberg. Thank you for the question. I think it
creates a powerful combination, the revenue sharing and the
programmatic NEPA reviews. And I think doing those programmatic
reviews across development areas allows the resource agencies
to really narrow the scope as they kind of look at projects,
and really look for those unique areas that need attention and
mitigation and addressing.
And I think doing that eliminates repetitive reviews.
Eliminating those repetitive reviews, again, allows the
resource agencies to focus on doing more projects and, in doing
so, I think increases the certainty for which developers have
to develop on Federal land.
And I think that, when it is paired with the revenue
sharing, with that programmatic process we are confident that
that would lead to developers looking more favorably at
developing on Federal lands, which is an important piece of the
clean energy story as we move forward.
Mr. Levin. Thank you for that.
Dr. Feldgus, I will turn to you. I understand that BLM is
currently in the process of updating its solar PEIS to support
appropriate project siting and avoid land use conflicts. I
appreciate the Department taking an important step to update
and build upon the 2012 Western Solar Plan. Can you walk me
through how this sort of large-scale planning supports the
BLM's multiple use mission while expediting project reviews?
Dr. Feldgus. Certainly, and thank you for the question.
The update to the Western Solar Plan, which is adding
additional states out West, and accommodating new technology in
the solar industry over the last decade, is designed to
identify those areas that are most appropriate for solar energy
while taking off the table those areas that are less
appropriate. And what that does is, first of all, it helps the
agency focus its resources. It gets the first studies completed
so we have a landscape-level study that we can build off of in
permitting individual projects, but it also tells developers
where is better to go, and where they will have a harder time.
So, we focus that development on those areas that are more
likely to be permitted, and that helps the overall permitting
process move more smoothly.
Mr. Levin. Thank you for that. We have a number of built-in
systemic advantages for fossil fuels, including revenue
sharing. So, I am glad we are considering a bill today to get
us closer to parity between oil and gas and renewable energy.
And I thank you, Chairman Stauber, and I hope we can work
together in a bipartisan fashion to advance policies that
ensure that projects on our public lands can be built in an
efficient manner. With that, I will yield back.
Mr. Stauber. Thank you, Mr. Levin. I will now recognize
Representative Fulcher for 5 minutes.
Mr. Fulcher. Thank you, Mr. Chairman, and thank you for the
panel for being here and for your testimony today.
I am going to have a question for Mr. Van Liew, but just to
set that up, I am from the state of Idaho, and Idaho is a
significant producer of minerals like silver, lead, and
phosphate. And those are essential raw materials in the energy
sector. And, of course, silver is used in critical electrical
systems, used for batteries, phosphates, and is vital for
drilling materials and protective coatings.
And given that the CORE Act modernizes data modeling
assessments for the Bureau of Ocean Energy Management, can you
just elaborate a little bit on how the increased offshore oil
and gas development under CORE could drive demand for these
materials, and subsequently boost our mining industry and our
economy? Could you talk about that a little bit more?
Mr. Van Liew. I appreciate the question, and I enjoy every
opportunity I get to go to Idaho.
The increased demand for the rare earth materials and
minerals that would come from increasing exploration and
production activities would, in fact, drive the economy and
jobs for your constituents in Idaho. But what the CORE Act is
attempting to do is better inform the decision-making so that
our 5-year plans can include additional areas in the offshore.
One thing to note I didn't note in a previous answer is
that offshore Atlantic and Pacific have gone decades without a
resource assessment, and are just, by and large, generally
excluded from 5-year plans. So, there are vast areas offshore
where resources may exist. Not only hydrocarbons, but
implementing surveys and adding to BOEM's resource knowledge
for alternative energies offshore in those areas. All would
contribute to the economy in Idaho through increased use of
rare materials.
Mr. Fulcher. Thank you for that. I am going to a follow-up
question. The CORE Act also addresses what it refers to as
transboundary hydrocarbon reservoirs and their potential
impacts.
So, first of all, I would like you to explain what that is,
a transboundary hydrocarbon reservoir.
And also, why should the United States have cooperating
agreements with neighboring countries in this regard? Could you
explain and address that, please?
Mr. Van Liew. The way I understand it is those boundaries
offshore are really where the Exclusive Economic Zones meet for
the various countries, like in the Arctic or in the Gulf of
Mexico with our neighbors to the south, and analyzing the
hydrocarbon resources that may exist along those boundaries to
better inform decisions by the agencies and by the industry on
developing those resources.
But also, it is important to have agreements with those
neighboring countries to ensure there is an agreement, from
what I understand, about sharing a resource that may straddle
that boundary----
Mr. Fulcher. Thank you for that, and along that line, of
course, Idaho is not a coastal state, but we still rely heavily
on transportation and agricultural industries, both of which
are heavily dependent on stable and affordable energy supply.
So, with that, could you explain a little further on how a
comprehensive inventory and potential development of the Outer
Continental Shelf oil and gas resources, as mandated in the
CORE Act, might influence fuel prices and security, even for
states like Idaho?
Mr. Van Liew. I appreciate that question as well. In my
non-day job I have a Club Lamb operation, so I am involved in
agriculture directly. And I know that the ranchers in Idaho,
who are very close to me as well, rely upon diesel and gas to
run their operations, and one of the highest input costs can be
the energy costs.
So, where the CORE Act can assist with that is expanding
and enhancing geoscience exploration to better inform, again,
decisions about where hydrocarbons may exist offshore so that
they can be developed and contribute to the supply. As demand
globally will continue to increase, we have to increase supply
to meet that demand to keep energy prices stable and lower for
the agriculture operators and your constituents in Idaho.
Mr. Fulcher. Thank you for that. I appreciate the insight.
With that, Mr. Chair, I yield back.
Mr. Stauber. Thank you very much. I will now recognize
Representative Tiffany from Wisconsin for 5 minutes.
Mr. Tiffany. Thank you, Mr. Chairman.
Mr. Van Liew, the Chairman of the Committee, Mr. Westerman,
brought up the issue of Chevron and the decision that just came
down at the end of June. Do you have any comments in regards to
that as far as how that may benefit us in the United States of
America here, as we go forward, especially with the permitting
timelines that have been out there?
We see interminable timelines of 10, 15, 20 years. How do
you view that decision and how it could possibly help shorten
these permitting times?
Mr. Van Liew. I appreciate the question. I will start by
saying that I am not an attorney, but in general we do view the
Chevron deference decision from the Supreme Court as positive,
in that we believe Congress and through the CORE Act with
defining timelines for G&G permits offshore is taking that
direction from the court to add specific timelines for when the
agencies should issue those G&G permits.
So, I think, by and large, it is good. Obviously, there can
be some downside, as well.
Mr. Tiffany. Do you see any reason, while having these
permitting processes be done in a more, call it expedited
fashion, it does not mean that we have to compromise
environmental standards?
Mr. Van Liew. That is correct. So, setting the timeline
here, in addition there are provisions in the CORE Act that
maintain the mitigation monitoring requirements that NMFS
itself has developed for existing geoscience activities, and
just carries those forward through the permits so we are not
going through additional analysis with the agency and
subjecting it to potential lawsuits from outside special
interests who are just aiming to shut down geoscience to stop
energy development.
Mr. Tiffany. Dr. Feldgus, we see in the last week that a
wind turbine off Nantucket blew up, and the debris is on the
shores of Nantucket. Will you folks be doing a thorough review
of what happened there?
Dr. Feldgus. Yes, we will. The Bureau of Safety and
Environmental Enforcement will be conducting an investigation
of the incident.
Mr. Tiffany. How long will it take to do that
investigation?
Dr. Feldgus. It is too early to say.
Mr. Tiffany. Does this give you a little bit of pause? I
mean, this is something that we have seen happen a few times
now, where wind turbines have blown up, and that there has been
a real problem. One article I read said this is not an unusual
circumstance, does that give you folks some pause?
Dr. Feldgus. Well, we are certainly concerned any time
there is an incident in the Outer Continental Shelf. So, we
intend to investigate this. And if there is anything that needs
to be done to make sure that it doesn't happen again, we will
certainly explore that.
Mr. Tiffany. When do you expect to have that review
completed?
Dr. Feldgus. That is hard for me to say.
Mr. Tiffany. So, a year, 2 years?
Dr. Feldgus. I mean, it is going to be as quickly as it
takes to conduct an investigation to figure out the root cause.
I know that GE is also doing their own investigation, but we
will be doing ours, as well. And it is just too early to say
how long that will take.
Mr. Tiffany. Yes. We see whales washing ashore, Mr.
Chairman, over on the East Coast. We see wind turbines washing
ashore over on the East Coast. It really causes, I think, many
of us to say, are we headed in the right direction when we are
seeing things like that happen?
I would go back, Mr. Van Liew, how efficient is wind and
solar? What is the maximum efficiency you find from a wind or
solar facility here in the United States of America?
Up where I live in Wisconsin, the maximum efficiency we
find is 25 percent. Do you find it is higher anywhere else in
the country?
Mr. Van Liew. I think that is probably a good estimate with
an intermittent energy source.
Mr. Tiffany. So, just about anywhere in the United States?
Mr. Van Liew. It probably varies to some extent, depending
on where you are at in the United States, but I don't have
those figures directly in front of me. I would be happy to
follow up with you.
Mr. Tiffany. Yes, I mean, this should really give us pause
that we are going to these intermittent sources of power.
I mean, I believe in an all-of-the-above approach, but we
are giving up baseload power here in America, and it is only a
matter of time we go the route of Western Europe and
California, where we are going to see power outages and things
like that going to these intermittent sources of power.
It is very clear that wind and solar are not ready to serve
the needs of the American people at this point, and we had
better make sure, if we are going to do this so-called energy
transition, that we keep these baseload sources of power to be
able to keep the lights on.
I yield back.
Mr. Stauber. Thank you very much. The Chair now recognizes
Representative Graves from Louisiana for 5 minutes.
Mr. Graves. Thank you, Mr. Chairman, I appreciate it.
Dr. Feldgus, good to see you again, glad you decided to
come back. Do unplugged orphan wells pose an environmental
risk?
Dr. Feldgus. Thank you for the question and, yes, they do.
Mr. Graves. They pose an environmental risk. So, taking
that the next step, plugging them helps to minimize or mitigate
that risk.
Dr. Feldgus. That is correct.
Mr. Graves. So, whenever the Department comes in and they
put additional steps that are hurdles in the process, you are
potentially lengthening, dragging out the amount of time it
takes to actually achieve that environmental objective in some
cases, wouldn't you?
Dr. Feldgus. Well, the goal is to make sure that we are
doing a good job, and to make sure that these plugging jobs are
working, that they maintain their seal, and no methane is
leaking afterwards.
And also, as someone mentioned earlier, to hold the program
accountable and make sure that we are reducing methane like the
intent of the section.
Mr. Graves. Well, I guess if the objective of the orphan
well program is to plug wells and prevent methane leak, then
got it. But Interior continues to put additional hurdles in the
process. And in fact, there was an assessment that was done by
Politico maybe a month or two ago, where they looked at the
American Rescue Plan, they looked at the Inflation Reduction
Act, they looked at the IIJA, and they determined that
somewhere around 70 percent of the funds from those bills, and
as you know, in some cases these bills go back 3 years, were
still in the bank.
And I remember when Mitch Landrieu, the former
infrastructure czar for the White House, called me and we
talked about the White House offering him this job. And I said,
``Mitch, your problem is that this Administration's regulatory
agenda is incompatible with their infrastructure agenda.'' And
I think we are seeing that. If 70 percent of the money is still
in the bank from 3 years ago, in some cases, 80 percent of the
life of these bills has passed, and they have only spent 30
percent of the money, and it seems that Interior is doing the
same thing.
Mr. Wright, I am curious. In Texas, do you do orphan well
programs outside of the funding from the Department of the
Interior? Meaning do you fund your own programs in some cases?
Mr. Wright. Yes, we do. The state of Texas has had a well-
plugging program using state funds for over 40 years.
Mr. Graves. Can you do a quick comparison and contrast
between how your state-led program works, timelines, cost,
compared to ones done with the Federal funds?
Mr. Wright. Certainly. Our onshore wells average cost of
$30,000 to $35,000 today. That has gone up due to inflation.
And we tend to plug about 1,000 wells, on the average, for
every year that we do it with state resources.
Mr. Graves. What about with Federal funds under the Federal
program?
Mr. Wright. In the initial grant funding, where we didn't
have any of the hurdles that we are seeing today in what the
formula grants are, we were able to plug, with that initial $25
million, 730 wells in one fiscal year. Today, we are on track
to hopefully plug 200 wells with the formula grant money.
Mr. Graves. And cost per copy of using the Federal funds
compared to the state, is there a significant difference? I
know you said that the most recent hurdles or obstacles weren't
factored in to the work that you have done, but the cost per
copy, is it comparable? Is it more expensive?
Mr. Wright. It is more expensive whenever you look at
having to measure, measure, not detect, methane. As I said in
my written testimony, we were seeing an increase in cost on the
average of $2,000 to $5,000 per well.
Mr. Graves. OK. So, of course, these additional hurdles
will cause additional time delays and additional cost, as well.
Mr. Wright. Time is always money.
Mr. Graves. Dr. Feldgus, I can't help but, seeing you in
here a few visits back when you came, you were talking to us
about this Administration's energy policy, specifically energy
production policy, and you were complaining about the energy
sectors sitting on permits, and you talked about how there were
9,000 to 10,000 permits that the companies were sitting on.
Later on, the Department of the Interior revised that
number down by about a third. Can you speak to that, and just
help us understand? It just seems like that maybe there was
some misleading testimony in the Committee leading us to
believe that there were more permits than were actually issued.
Dr. Feldgus. Right now, it is about 7,000 permits that have
been approved.
Mr. Graves. So, you revised your number from over 9,000
down to about 6,000 a year or so ago.
Dr. Feldgus. I would have to double check the numbers. I
will say sometimes that data is constantly changing as
companies are getting new permits or using those permits.
Mr. Graves. But, off by a third is pretty, pretty
substantial.
Dr. Feldgus. I would like to go back and double check those
numbers.
Mr. Graves. That would be great. I would love to hear that.
Last question, Dr. Feldgus. The fact that Interior is
refusing to do a 5-year plan, based on how long it takes to go
to production, what advice would you give these future
administrations that you are just completely going to send them
off a cliff in regard to energy production?
Dr. Feldgus. Well, we have approved a 5-year plan.
Mr. Graves. And the leases are when?
Dr. Feldgus. Well, we have a lease sale scheduled for, I
believe, 2025.
Mr. Graves. Fewer leases. In fact, 1/100 of the acres
leased under the Carter administration, 1/100.
So, again, the advice you would give to future
administrations based on the raw deal you are handing them?
Dr. Feldgus. We have lease sales scheduled offshore. We are
doing quarterly lease sales onshore.
Mr. Graves. It is 1/100 of Jimmy Carter, 1/357 of Ronald
Reagan.
Thank you. I yield back.
Mr. Stauber. Thank you very much.
And before we close, I do want to enter into the record
from the Environmental Defense Fund dated March 24, 2023, sent
to Interior, it is the comments that I read, where they
disapprove of some parts of the methane emission testing.
[The information follows:]
ENVIRONMENTAL DEFENSE FUND
March 24, 2023
Kimbra Davis, Director
U.S. Department of the Interior
Orphan Well Program Office
1849 C Street NW
Washington, DC 20240
Dear Ms. Davis, and interested parties:
EDF appreciates the opportunity to comment on the Department of
Interior's Phase 1 (Fiscal Year 2023) State Formula Grant Guidance of
the Bipartisan Infrastructure law Sec. 40601 Orphaned Well Program. We
are grateful for DOI's leadership and for taking on the responsibility
of formulating and administering this ambitious program. We commend DOI
on a comprehensive first draft. Given the scale and cost of the orphan
well plugging challenge, we suggest some revisions to the draft and
approach, which we believe will strengthen the Federal-State
partnership and will ultimately maximize the number of wells plugged
nation- wide. There is a tremendous opportunity here to leverage both
the DOI's and the state regulatory agencies' strengths in oil and gas
well management to get the most value out of taxpayer's dollars in
plugging the most and worst orphan wells and significantly reducing the
risks to the environment, public health, safety and the climate posed
by these wells.
While the $4.7 Billion REGROW funding as part of the Infrastructure
Investment and Jobs Act provides a tremendous opportunity to
dramatically accelerate our collective efforts to tackle the orphan
well problem, the scale of the problem is vast. As a result, it is
likely this funding at best will accomplish plugging less than half of
the estimated 125 thousand documented orphan wells which have a total
estimated actual closure cost of $8.5 Billion. And this is only a start
to solving the larger undocumented orphan well issue with estimates
that range from 300 to 800 thousand of these wells, or more. To that
end, it is critical that DOI work closely with the state agencies to
maximize the efficiency and effectiveness of the State Formula Grants
and focus this spending on the well closure work while keeping costs
contained as much as possible.
We recommend DOI work closely with State Agency representatives and the
IOGCC to revise the current draft with particular attention paid to the
following areas:
1. Provide predictability for entire State Formula Grants
To ensure success for this program, it is critical that state
agencies and industry stakeholders understand the approximate size and
timing of the funding so they can plan their budgets with as much lead-
time as possible. It is not clear in the current draft how DOI is going
to inform the state agencies of the amount of funding they can expect
and when so that they can effectively plan, and in turn how the states
can signal to industry what to anticipate so that the market can
respond accordingly. A phased approach where the recipients do not have
insight into when or how much they will receive in later phases will
hamper their ability to staff up and plan strategically. Expanded state
plugging programs will require additional personnel (inspectors, data
analysts, etc.), monitoring equipment, and data management and
infrastructure, and analysis tools. Service providers will also need to
anticipate operating and capital costs in order to provide the trained
crews (project engineers, drillers, rig hands, etc.), rigs and
materials (cement, piping etc.) in a timely fashion. Recent history has
demonstrated the challenges of volatile markets and supply side shocks
to the service industry, such as competition and access to drilling
rigs and shortages of materials such as cement and iron. The success of
the program in large part hinges on the agencies' ability to most
efficiently manage resources to maximize the effectiveness of their
plugging programs. A lack of certainty and commitment to funding will
not provide clear signals to the evolving well plugging market and will
potentially drive costs up and increase chances of supply-chain
bottlenecks. We urge DOI to work with the states and the IOGCC on the
ideal timeline for committing funds to maximize efficiencies and
economies of scale.
2. Manage program costs and reduce additional costs wherever possible
in order to maximize plugging of prioritized wells
There are some requirements in the current draft that would likely
significantly drive up the costs and time needed to plug wells and
could materially reduce the number of wells states will be able to plug
within the budget and timeframe of the formula grants. Of particular
concern is the requirement to measure and quantify methane emissions
before and after plugging. While we applaud every opportunity to
measure progress on methane emissions reduction, in order to maximize
the number of methane-emitting orphaned wells closed through this
program, we suggest shifting the approach to get the same benefit but
at a much lower cost. Methane emissions are one of a host of
environmental risks posed by orphan wells, which can include
groundwater and surface water contamination in addition to public
health risks posed by a variety of polluting-gases depending on the
geology. Collaborating with state agencies and the IOGCC on the most
efficient and cost-effective methods for inspecting wells before and
after plugging for all environmental, public health and safety risks is
strongly advised.
Recommendations for methane emissions quantification
Methane emissions quantification for orphan wells is more in the
science phase than the commercial phase, and for that reason, many
states are having trouble finding contractors able to do this work, and
when they can, they are often quoted sufficiently high rates as to
materially cut into the budget for the actual plugging work. There is
also a logistical challenge of combining methane measurement
quantification with plugging activities given the current nascent state
of the methane measurement industry. When states send crews out to plug
the wells, while it will make sense and be cost-effective to have those
crews conduct a show/no show test for methane emission with a FLIR
camera or equivalent, their immediate next priority will be to plug the
well. The well-plugging crews are not likely to have the expertise or
equipment to conduct methane measurement experiments in addition to
plugging activities in a cost effective or timely way.
It is premature given the state of the science and of the methane
measurement industry to require states to quantify methane emissions
from every orphan well with a methane show. DOI should instead work
with DOE, the IOGCC, state agencies and other relevant stakeholders to
develop workable methodologies and protocols for assessing methane
emissions and identifying the biggest emitters. We also recommend DOI
work with the nascent methane measurement industry to determine and
optimize methodologies, costs and services. DOI can work with its
partner agencies and stakeholders to develop pilot projects along these
lines in advance of a more comprehensive solution. This recommendation
does not preclude DOI and state agencies from requiring their plugging
contractors to do a show/no show analysis on the orphan wells to at
least identify methane emitters for future analysis and monitoring.
Recommendations for surface and groundwater monitoring
An additional concern for managing costs and timelines for
maximizing plugging is the requirement for before and after surface and
groundwater monitoring. While we agree this is of upmost importance as
protecting and restoring drinking water supplies and ecosystems is at
the heart of the mission, we suggest a phased and measured approach to
both accomplish monitoring while also maximizing the number of
contaminating and potentially future contaminating wells plugged. We
encourage DOI to work with state agencies to identify the most cost-
effective methods for assessing surface water impacts, such as before
and after site photographs or affordable remote sensing/imaging.
Groundwater monitoring presents a number of challenges and ideally
requires access to functioning on-site or nearby monitoring wells which
may or may not exist. In addition, dedicated specialized field and lab
personnel, such as hydrogeologists and geochemists are required to
evaluate groundwater conditions and perform pump tests, geochemical
analyses, groundwater modeling, etc. We suggest that DOI form a
separate working group with agencies with groundwater expertise such as
the USGS, GWPC and state agencies, to identify and evaluate the best
and most cost-effective methods for monitoring groundwater in the
vicinity of orphaned wells.
Skilled labor costs and job-training
Access to skilled plugging crews at affordable prices is already a
challenge for state agencies and will be increasingly difficult as
competition for plugging crews ramps up. Costs are rising rapidly due
to labor shortages, supply chain shortages (e.g., cement) and
competition for skilled labor in a market that is currently saturated.
We encourage DOI to think creatively in its approach to minimize these
challenges and consider working collaboratively with states and other
parts of the administration such as the Department of Labor as well as
with industry associations to think through how to best train people to
participate in what is clearly a growing industry. DOI might consider
forming working groups with a variety of stakeholders to both
understand and figure out how best to grow the pipeline for skilled
well-plugging labor, particularly in communities within oil and gas
producing regions. This issue undoubtedly overlaps with labor needs in
other subsurface areas of the energy transition such as enhanced
geothermal, CCS and hydrogen storage, and it would be strategic to
explore the synergies of building a multi-purpose workforce from the
recently laid-off oil and gas workers, before they move on to other
trades, and for the younger generation entering the work force. In
addition to the shared goal of meaningful job creation in oil and gas
producing regions, a larger labor pool will also lower overall costs of
well-plugging and maximize this opportunity.
Cost Recovery
Documented orphan wells are by definition no longer associated with
a solvent owner. If, however in the process of evaluating orphan wells,
a solvent owner was identified, the assumption is the state agency
would pursue recovering plugging and other closure costs. While we
agree that agencies should pursue cost recovery from solvent parties
whenever plausible, we also hope the priority will stay focused on
plugging the at-risk wells. Cost recovery can always come later. We
encourage DOI to keep the program structured such that the plugging of
prioritized wells is not delayed while recovering costs at this phase
of the program. We commend DOI on its requirements for data collection
and reporting which will both add transparency and facilitate tracking
and analysis of well plugging activities for government agencies and
for civil society.
Some final thoughts
We commend DOI on forming the Orphan Well Program Office and
positioning itself to strategically to lead the Orphan Well Program. We
encourage DOI to consider structuring the State Formula Grants
similarly to cooperative agreements, where the states are given a
certain amount of leeway to design how they spend the grants, and the
agreements can be implemented through collaborative oversight between
DOI and the state agencies. We think the ingredients for success of
this program will require a true partnership with the federal
implementing agency and the states. Substantive provisions should be
worked out collaboratively whenever possible, so no one is taken by
surprise. For example, we encourage DOI to work with state agencies and
the IOGCC on reviewing and potentially strengthening the Data
Collection and Reporting section to further leverage and expand on the
use of existing data reporting and management tools such as the GWPC
RBDMS system. Encouraging and supporting digital transformation of
these systems will both increase the transparency of the reporting and
facilitate analysis and communication of the results.
Thank you again for leading this effort. We look forward to
constructive engagement with DOI as it works to ensure that state oil
and gas regulatory agencies have the funds needed for plugging
prioritized orphan wells across the nation, creating jobs and reducing
climate impacts and environmental, safety and health risks.
Sincerely,
Adam Peltz Meg Coleman
Director and Senior
Attorney Policy Manager
______
Mr. Stauber. Again, Mr. Graves, I will say that in the 5-
year plan, this Administration has three that are scheduled,
and probably only one, maybe one in 5 years. Yes.
I want to thank the witnesses for the valuable testimony
and the Members for their questions.
The members of the Subcommittee may have some additional
questions for the witnesses, and we will ask you to respond to
these in writing. Under Committee Rule 3, members of the
Committee must submit questions to the Subcommittee Clerk by 5
p.m. on Friday, July 26. The hearing record will be held open
for 10 business days for these responses.
If there is no further business, without objection, the
Committee stands adjourned.
[Whereupon, at 12:47 p.m., the Subcommittee was adjourned.]
[ADDITIONAL MATERIALS SUBMITTED FOR THE RECORD]
Prepared Statement of the Hon. Glenn ``GT'' Thompson, a Representative
in Congress from the State of Pennsylvania
Subcommittee Chairman Stauber, Ranking Member Ocasio-Cortez, and
Members of the Subcommittee on Energy and Mineral Resources:
Good morning and thank you for providing the opportunity to share
my support for H.R. 7053, which is being considered at today's hearing.
Representing the great Commonwealth of Pennsylvania, a state with a
long and proud history of oil and gas production, I am keenly aware of
the environmental and economic challenges posed by abandoned and orphan
wells. These wells, either unplugged or improperly plugged, can pose
serious environmental threats to surrounding communities.
A study conducted this year by the Interstate Oil and Gas Compact
Commission (IOGCC) reported a total of 141,959 documented orphan wells
in the 29 states participating in the report, with potentially
thousands more left undocumented.\1\ Many known orphan wells have no
verifiable ownership or operator, which makes it more difficult for
state agencies to prioritize which wells to plug. In Pennsylvania
alone, there are approximately 27,230 documented abandoned and orphan
oil and gas wells according to the Pennsylvania Department of
Environmental Protection.
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\1\ Idle and Orphan Oil and Gas Wells: State and Provincial
Regulatory Strategies 2024, Interstate Oil and Gas Compact Commission
The federal government currently allocates significant resources
across a number of agencies to address these wells, such as the Orphan
Wells Program Office within the Department of the Interior; however,
the Infrastructure Investments and Jobs Act (IIJA) (P.L. 117-58)
provided $4.7 billion in grants to qualifying state agencies for
plugging operations. Since the IIJA was signed into law, $701 million
has been distributed to twenty-four states for well plugging projects,
according to the Department of the Interior.\2\ Unfortunately, in many
cases, funding to states came with unexpected and costly strings
attached that are hindering efficient and effective plugging efforts on
the ground. The initial grant guidance issued to state agencies by the
Department of the Interior mandates an inspection of each potential
orphan well site to test for leaks of methane and other gases, and, if
identified, to measure the rates of such leaks. This additional testing
requirement, which was not included in the IIJA, can significantly
impact states by requiring more staff, costing thousands of dollars per
well and significantly delaying plugging operations.
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\2\ FY 2023 Orphan Wells Congressional Report, U.S. Department of
the Interior
To maximize the effect of federal dollars, methane air and
groundwater testing requirements must be optional, not required, for
states to access federal funding. That is why I was proud to introduce
H.R. 7053, the Orphan Well Grant Flexibility Act, to empower states
like Pennsylvania to maximize their operational flexibility in
addressing this critical issue. This bipartisan legislation would grant
states greater discretion and flexibility when utilizing federal orphan
well grant funds allocated through the IIJA. Specifically, H.R. 7053
will ensure that pre- and post-plugging methane testing is permitted,
but not required, for states that utilize federal funding for well
plugging operations. This would allow states to tailor their plugging
programs to the specific needs and challenges they face. For instance,
Pennsylvania has a large number of shallow wells, requiring different
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plugging techniques compared to deeper wells in other states.
Additionally, H.R. 7053 emphasizes the economic benefits that
plugging abandoned and orphan wells provide to local communities.
Studies, such as the aforementioned 2024 IOGCC Orphan Well Study,
demonstrate that plugging orphan and abandoned wells creates jobs and
revitalizes local economies. The bill directs the National Academy of
Sciences, in collaboration with the U.S. Department of Housing and
Urban Development, to evaluate the economic development, housing
trends, and environmental benefits in areas where federal funds have
been used successful to plug and remediate abandoned and orphan wells.
This will provide a clear picture of the returns on these federal
investments, as well as potential areas for improvement.
The benefits of the Orphan Well Grant Flexibility Act are clear.
This bill offers a commonsense, bipartisan solution to addressing
abandoned and orphan wells across the country, which is why it has
received support from a range of industry, environmental, and
conservation stakeholders across the ideological spectrum. By
empowering states and communities, H.R. 7053 will expedite well
plugging, save taxpayers, protect ecosystems, and revitalize local
economies.
Once again, I thank the Members of this Subcommittee for
considering the significant environmental and economic benefits of H.R.
7053 and advancing this critical legislation. I am looking forward to
working with you all to revitalize our communities, protect our
environment, and create high-quality, family-sustaining jobs.
______
Statement for the Record
Bureau of Ocean Energy Management
U.S. Department of the Interior
on Discussion Draft of H.R. ____, Comprehensive Offshore Resource
Evaluation Act (CORE Act)
Chairman Stauber, Ranking Member Ocasio-Cortez and members of the
Subcommittee, thank you for the opportunity to provide this Statement
for the Record on the discussion draft, Comprehensive Offshore Resource
Evaluation Act (CORE Act). The Department of the Interior (Department,
DOI) notes its strong preference to testify on bills after they have
been introduced. Given the breadth of subject matter contained in the
text of the bill, the Department did not have adequate time to conduct
an in-depth analysis of its provisions. We are providing the following
preliminary comments on the draft bill but would like to preserve the
opportunity to submit additional input on the bill after it is
introduced, if necessary. The Department defers to the U.S. Department
of Commerce, National Oceanic and Atmospheric Administration on
incidental take authorizations under the Marine Mammal Protection Act
(MMPA).
The Bureau of Ocean Energy Management (BOEM) is taking a leading
role in transitioning the U.S. to a clean energy future--one that will
advance renewable energy, create good-paying jobs, and ensure economic
opportunities are accessible to all communities, including underserved
communities--while managing the development of oil and gas resources on
the U.S. Outer Continental Shelf (OCS) in an environmentally and
economically responsible manner.
For decades, resource evaluations have been carried out by
geologists, statisticians, and economists, providing critical input to
decision-makers and inform various policy alternatives. Increasingly
complex quantitative techniques and procedures have been developed in
response to the needs and uses for these assessments.
Section 2: Comprehensive Inventory of OCS Oil and Gas Resources
Section 2 of the CORE Act amends Section 357 of the Energy Policy
Act of 2005 (EPACT) to expand the Department's comprehensive inventory
and analysis of undiscovered oil and natural gas resources on the OCS.
The new Section 357 would, in part, require the following analyses:
An assessment of undiscovered oil and gas resources in
each planning area on the OCS;
An assessment of the effects that production of
undiscovered resources would have on the economy of the
United States and the economic and environmental impacts
that laws limiting lands available for leasing (i.e.,
section 12 of the OCS Lands Act) have on the exploration,
development, and production of oil and gas;
A determination of the approximate net greenhouse gas
emission reductions that would occur if the total quantity
of oil and gas resources imported from foreign countries
were replaced with newly produced undiscovered resources;
An identification of alternative sources of energy that
communities could rely on if the oil and gas resources
assessed are not discovered and developed;
A comparison of the amount of onshore or offshore acreage
and infrastructure required to produce an equivalent amount
of energy from renewable sources (such as solar and wind)
compared to oil and gas;
An examination of the feasibility of conducting and
acquiring new geophysical seismic surveys on the OCS; and
Once every 10 years, an assessment of the costs, benefits,
and accuracy of the models utilized to conduct resource
assessments, including consultation with various oil and
gas industry associations.
Furthermore, the CORE Act would require the Secretary of the
Interior to submit the newly updated inventory to Congress no later
than 180 days after the date of enactment.
Currently, section 357 of EPACT directs the Secretary of the
Interior to conduct an inventory and analysis of oil and natural gas
resources contained within the submerged lands of the U.S. OCS, and to
submit this analysis to Congress every 5 years. At present, these
required analyses are required to:
Incorporate available data on oil and natural gas
resources in areas offshore of Mexico and Canada that are
relevant to estimate the resource potential of the OCS;
Use any available technology except drilling to obtain
accurate resource estimates;
Analyze how OCS resource estimates have changed over time
in relation to available data and exploration and
development activities;
Estimate the effect of understated oil and natural gas
resource estimates on domestic energy investments; and
Identify and explain how legislative, regulatory, and
administrative programs or processes restrict or impede
resource development and affect domestic supply.
The CORE Act would greatly expand the analysis/forecasting
conducted under section 357 and would require additional research,
funding, and time to conduct. In addition, some of the provisions
within the discussion draft are potentially duplicative of existing
processes. Similar analyses are conducted as part of the National OCS
Oil and Gas Leasing Program development process (e.g., analysis of
national energy needs and contributions of oil and natural gas to the
U.S. economy), and as part of BOEM's National Environmental Policy Act
processes.
The Department would like to work with the Sponsor and the
Subcommittee on aligning any new requirements with current processes
and ensuring that Congress receives the necessary OCS conventional
energy resource information in an effective and efficient manner.
Section 3: Transboundary Hydrocarbons Report
Section 3 requires the Secretary of State, in consultation with the
Secretary of the Interior, to submit a report to Congress on existing
and potential transboundary hydrocarbon reservoirs on the OCS.
Currently, the United States is party to a transboundary agreement
(TBA) with Mexico that establishes a legal framework for the
exploitation of transboundary hydrocarbon reservoirs that may exist
along the maritime boundary between the United States and Mexico in the
Gulf of Mexico. The Secretary of the Interior is tasked with
implementation, which in turn has been delegated to BOEM and the Bureau
of Safety and Environmental Enforcement. The TBA provides a process for
orderly assessment and development of any hydrocarbon resources
determined to be transboundary, including the allocation of resources
to each party, safety and environmental protection responsibilities,
and efficient production of the resources. The TBA would be used as a
reference for negotiations related to the development of similar
agreements with other neighboring countries where the potential for
transboundary hydrocarbon resources could exist.
Additionally, while the Department has existing assessments of
gross resource potential across the OCS, BOEM does not currently have
access to seismic and well data in Mexican and Russian waters to
delineate the extent of potential hydrocarbon reservoirs that may cross
international borders. Access to foreign data, if available, would
require negotiated data sharing agreements or the addition of funding
to purchase this data from commercial sources.
Section 4: Offshore Geological and Geophysical Survey Licensing
Under Section 4, the CORE Act requires NOAA to maintain incidental
take regulations under the MMPA governing the issuance of Letters of
Authorizations for OCS geophysical and geological surveys that shall
not expire, requires the current NOAA incidental take regulations for
geological and geophysical (G&G) surveys to be in place for perpetuity,
and requires the Secretary of the Interior to permit G&G surveys
related to oil and gas activities on the Gulf of Mexico OCS within 30
days of receiving a completed application.
The Department of Interior strongly supports permitting and
authorization efficiency, but also supports the need to thoroughly
evaluate the impacts associated with oil and gas activities, including
G&G surveys, on marine resources. The issuance of oil and gas G&G
permits in the Gulf of Mexico OCS currently takes 60-90 days to ensure
sufficient reviews and activity-specific consultation with NOAA under
the Endangered Species Act (ESA) and MMPA. The purpose of those
environmental reviews and consultations is to manage the potential
impacts of G&G activities on protected species and identify appropriate
measures to avoid, minimize, and mitigate impacts. BOEM's ability to
adapt to new information and changing operations allows for
improvements in the efficiency and effectiveness of environmental
review outcomes, which may not be possible if all current requirements
are frozen in time and review periods are arbitrarily curtailed. The
Department would like to work with the Sponsor and the Subcommittee on
how the bill's potential requirements could be aligned with the
Department's existing G&G permitting process while ensuring continued
protection of important marine resources.
Conclusion
Thank you for the opportunity to provide this Statement for the
Record and discuss the Department's efforts to responsibly manage our
nation's energy resources on the OCS to meet the Nation's energy needs
while minimizing impacts to the ocean, ocean users, and marine life.
These programs are essential for the administration's continued
commitment to ensuring a clean and secure energy future--one that is
sustainable and benefits all Americans.
______
Statement for the Record
U.S. Geological Survey (USGS)
Department of the Interior
on H.R. 8665, the Supercritical Geothermal Research and Development Act
Chairman Stauber and Ranking Member Ocasio-Cortez, thank you for
the opportunity to provide this statement on H.R. 8665 the
Supercritical Geothermal Research and Development Act, a bill to amend
the Energy Independence and Security Act of 2007 to direct research,
development, demonstration, and commercial application activities in
support of supercritical geothermal and closed-loop geothermal systems
in supercritical various conditions, and for other purposes.
Background
Geothermal energy is a significant source of renewable electric
power in the western United States and, with advances in exploration
and development technologies, a potential source of a large fraction of
baseload electric power, heating, and cooling, for the entire country.
A critical question for future energy planning is the extent to which
geothermal resources can contribute to the increasing demand for low-
carbon electricity.
The USGS has a long history of research and assessment of
geothermal resources in the United States. Several laws have authorized
the USGS to conduct regional and national appraisals of all types of
viable geothermal resources. USGS national-scale assessments and
supporting research studies provide State and Federal government
policymakers with the information they need to evaluate the potential
contribution of geothermal energy to the nation's energy portfolio. In
response to the Geothermal Steam Act of 1970, the USGS identified known
geothermal resource areas in 1971 and completed the first national-
scale assessment of geothermal resources of the United States in 1975,
followed by a second assessment in 1979. In response to the Energy
Policy Act of 2005 and the Energy Independence and Security Act of
2007, the USGS produced an updated national geothermal energy
assessment in 2008. The Energy Act of 2020 authorized new assessments
to incorporate additional geothermal resource types across the entire
United States, including Alaska, Hawaii, and Puerto Rico.
Supercritical resources are an emerging geothermal resource that
involves drilling into super-hot (typically >370+C or 700+F) rock near
active volcanic centers. While it is well known that the
crystallization of magma chambers releases large amounts of energy at
very high temperatures, a systematic method of harvesting this heat has
not been developed. The most significant problems relate to effective
targeting of supercritical temperatures in the subsurface to
efficiently access the heat and developing tools and equipment that can
work reliably at these high temperatures.
H.R. 8665
H.R. 8665 amends the Energy Independence and Security Act of 2007
to direct research, development, demonstration, and commercial
application activities in support of supercritical geothermal and
closed loop geothermal systems in supercritical various conditions, and
for other purposes. We have several comments for your consideration.
At Section 2, paragraph (a)(3)(D), we note that the USGS Energy
Resources Program has a long- standing partnership with the Department
of Energy's Geothermal Technologies Office. The partnership involves
data collection and data interpretation including USGS Earth Mapping
Resources Initiative (Earth MRI) collection of subsurface data
essential to characterizing both geothermal resources and critical
mineral resources. At present, the partnership leverages each agency's
complementary skills, with the USGS providing geoscience data
interpretation, research, and resource assessments, and DOE leading on
the geothermal technology-related data. There would be additional costs
and potential inefficiencies associated with moving toward a fully
shared data model, including identification of key datasets, data
formatting, and population of the drilling data repository with data
from ongoing and completed mining, critical minerals, and energy
projects. The USGS would not be able to complete this work with its
current level of resources.
At paragraph (a)(3)(e), we note that the deepest geothermal
exploratory wells have only recently (2023) reached depths of 5
kilometers, with 7 kilometers as a proposed current technological limit
for conventional geothermal resource development. Geothermal resource
development below this depth requires emerging technologies that have
not at present achieved economic viability. Increasing drilling depth
beyond 8 kilometers will be considerably more costly and will, for some
geologic provinces, require continued advancements in drilling
technologies (an ongoing research program by the DOE). The USGS would
not be able to commission drilling of exploration boreholes to depths
greater than 8 kilometers with its current level of resources.
At paragraph (b)(1)(A)(iv), we note that adding an additional
assessment of supercritical geothermal resources is a significant
expansion of scope of USGS's responsibilities and would require
development of new assessment techniques. The USGS would not be able to
complete this work in a timely fashion with its current level of
resources.
At paragraph (b)(2), we note that it is not possible to complete an
update to the National Geothermal Resource Assessment within 180 days
after enactment of the bill into law. Since the enactment of the Energy
Act of 2020, the USGS has been able to develop and apply assessment
methods for two of the four geothermal assessment types envisioned
under that law. A modest increase in funding, as requested in the
FY2025 Budget, supports essential planning efforts and will allow the
USGS to accelerate progress toward completing geothermal resource
assessments for conventional hydrothermal, enhanced geothermal systems,
low-temperature and underground thermal energy storage. Assessing
potential for co-production of minerals and geothermal energy (per the
Energy Act of 2020) will also occur. Quadrennial updates would be
possible following completion of the first updated assessment.
The USGS appreciates Congressional interest in the expansion of
geothermal assessments and the opportunity to provide these comments.
We support the underlying goal of this legislation to promote research
on supercritical geothermal systems. We would be happy, at your
request, to provide briefings on current geothermal research and
assessment activities conducted under our existing authorities and
additional technical assistance in developing this bill.
______
Submission for the Record by Rep. Grijalva
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