[House Report 112-251]
[From the U.S. Government Publishing Office]


112th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 1st Session                                                    112-251

======================================================================



 
          EXPLORING FOR GEOTHERMAL ENERGY ON FEDERAL LANDS ACT

                                _______
                                

October 14, 2011.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

 Mr. Hastings of Washington, from the Committee on Natural Resources, 
                        submitted the following

                              R E P O R T

                             together with

                            DISSENTING VIEWS

                        [To accompany H.R. 2171]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Natural Resources, to whom was referred 
the bill (H.R. 2171) to promote timely exploration for 
geothermal resources under existing geothermal leases, and for 
other purposes, having considered the same, report favorably 
thereon with an amendment and recommend that the bill as 
amended do pass.
    The amendment is as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Exploring for Geothermal Energy on 
Federal Lands Act''.

SEC. 2. GEOTHERMAL EXPLORATION NOTICE AND EXCLUSION.

  (a) Definition of Geothermal Exploration Test Project.--In this 
section the term ``geothermal exploration test project'' means the 
drilling of a well to test or explore for geothermal resources on lands 
leased by the Department of the Interior for the development and 
production of geothermal resources, that--
          (1) is carried out by the holder of the lease;
          (2) causes--
                  (A) less than 5 acres of soil or vegetation 
                disruption at the location of each geothermal 
                exploration well; and
                  (B) not more than an additional 5 acres of soil or 
                vegetation disruption during access or egress to the 
                test site;
          (3) is developed--
                  (A) no deeper than 2,500 feet;
                  (B) less than 8 inches in diameter;
                  (C) in a manner that does not require off-road 
                motorized access other than to and from the well site 
                along an identified off-road route for which notice is 
                provided to the Secretary of the Interior under 
                subsection (c);
                  (D) without construction of new roads other than 
                upgrading of existing drainage crossings for safety 
                purposes; and
                  (E) with the use of rubber-tired digging or drilling 
                equipment vehicles;
          (4) is completed in less than 45 days, including the removal 
        of any surface infrastructure from the site; and
          (5) requires the restoration of the project site within 3 
        years to approximately the condition that existed at the time 
        the project began, unless the site is subsequently used as part 
        of energy development on the lease.
  (b) NEPA Exclusion.--Section 102(2)(C) of the National Environmental 
Policy Act of 1969 (42 U.S.C. 4332(2)(C)) shall not apply with respect 
to a project that the Secretary of the Interior determines under 
subsection (c) is a geothermal exploration test project.
  (c) Notice of Intent; Review and Determination.--
          (1) Requirement to provide notice.--A leaseholder intending 
        to carry out a geothermal exploration test project shall 
        provide notice to the Secretary of the Interior not later than 
        30 days prior to the start of drilling under the project.
          (2) Review of project.--The Secretary shall by not later than 
        10 days after receipt of a notice of intent under paragraph (1) 
        from a leaseholder--
                  (A) review the project described in the notice and 
                determine whether it is a geothermal exploration test 
                project under subsection (a); and
                  (B) notify the leaseholder--
                          (i) that under subsection (b) of this 
                        section, section 102(2)(C) of the National 
                        Environmental Policy Act of 1969 (42 U.S.C. 
                        4332(2)(C)) does not apply to the project; or
                          (ii) that section 102(2)(C) of the National 
                        Environmental Policy Act of 1969 (42 U.S.C. 
                        4332(2)(C)) applies to the project, including 
                        clear and detailed findings on any deficiencies 
                        in the project that preclude the application of 
                        subsection (b) of this section to the project.
          (3) Opportunity to remedy.--If the Secretary provides notice 
        under paragraph (2)(B)(ii) that section 102(2)(C) of the 
        National Environmental Policy Act of 1969 (42 U.S.C. 
        4332(2)(C)) applies to the project, the Secretary shall provide 
        the leaseholder an opportunity to remedy the deficiencies 
        described in the notice prior to the date the leaseholder 
        intended to start of drilling under the project.

                          PURPOSE OF THE BILL

    The purpose of H.R. 2171, as ordered reported, is to 
promote timely exploration for geothermal resources under 
existing geothermal leases.

                  BACKGROUND AND NEED FOR LEGISLATION

    Geothermal energy can be used for electricity production, 
for commercial, industrial, and residential direct heating 
purposes, and for heating and cooling through geothermal heat 
pumps. To develop geothermal electricity, wells bring 
geothermal water to the surface, where its heat energy is 
converted into electricity at a geothermal power plant. 
Geothermal heat can also be used without involving a power 
plant or heat pump for applications such as space heating and 
cooling, food preparation, greenhouses, and agriculture.
    The U.S. Geological Survey estimates that the geothermal 
industry has the potential to generate 39,000 megawatts of 
electricity in the United States using existing technologies. 
There are currently an estimated 144 projects under development 
in the U.S. These projects are projected to produce 624,000 
construction jobs and will require $26 billion in capital over 
the next five years, 50 percent of which will be allocated to 
the exploration and drilling phases.
    The Bureau of Land Management (BLM) regulates geothermal 
project development. To test for geothermal resources on BLM 
land, a project developer must hold a lease for the 
corresponding land area. Currently, there is a separate 
application submitted for each project development phase that 
must be approved by BLM before the phase can commence. The 
process of drilling a well simply to test for geothermal 
resources requires both a permit and a National Environmental 
Policy Act (NEPA) review and frequently takes 10 months, but 
can be tied up in the review process for more than a year. When 
a company has to drill multiple holes for exploration, and 
possibly additional subsequent holes, all which require 
repeating this process, geothermal resources are not being 
expeditiously discovered and utilized.
    The Exploring for Geothermal Energy on Federal Lands Act 
(H.R. 2171) facilitates the development of geothermal energy 
resources by streamlining regulations that hamper exploration. 
The legislation would waive NEPA requirements for a geothermal 
exploration test project so a project can quickly move forward 
if resources are found. These temporary test projects create 
minimal surface disturbance, do not require off-road motorized 
access other than to and from the well site, and are typically 
restored to the land's original condition following the 
conclusion of the project.

                            COMMITTEE ACTION

    H.R. 2171 was introduced on June 14, 2011, by Congressman 
Raul Labrador (R-ID). The bill was referred to the Committee on 
Natural Resources, and within the Committee to the Subcommittee 
Energy and Mineral Resources. On June 23, 2011, the 
Subcommittee on Energy and Mineral Resources held a hearing on 
the bill. On July 13, 2011, the Full Resources Committee met to 
consider the bill. The Subcommittee on Energy and Mineral 
Resources was discharged by unanimous consent. Congressman Raul 
Labrador (R-ID) offered an amendment; the amendment was adopted 
by voice vote. Congressman John Garamendi (D-CA) offered an 
amendment designated .057; the amendment was withdrawn. 
Congressman Ed Markey (D-MA) offered an amendment designated 
.002; the amendment was not adopted by a bipartisan roll call 
vote of 15-26, as follows:


    The bill, as amended, was then ordered favorably reported 
to the House of Representatives by a bipartisan roll call vote 
of 26-16, as follows:


                      SECTION-BY-SECTION ANALYSIS

Section 1. Short title

    This Act may be cited as the ``Exploring for Geothermal 
Resources on Federal Lands Act.''

Section 2. Geothermal exploration notice and exclusion

    This section waives NEPA requirements for any geothermal 
exploration test hole project. It requires a leaseholder to 
provide notice to the Secretary of the Interior no later than 
30 days prior to the start of drilling under the project. It 
also requires the Secretary to review the notice of intent 
within 10 days after receipt.

            COMMITTEE OVERSIGHT FINDINGS AND RECOMMENDATIONS

    Regarding clause 2(b)(1) of rule X and clause 3(c)(1) of 
rule XIII of the Rules of the House of Representatives, the 
Committee on Natural Resources' oversight findings and 
recommendations are reflected in the body of this report.

                    COMPLIANCE WITH HOUSE RULE XIII

    1. Cost of Legislation. Clause 3(d)(1) of rule XIII of the 
Rules of the House of Representatives requires an estimate and 
a comparison by the Committee of the costs which would be 
incurred in carrying out this bill. However, clause 3(d)(2)(B) 
of that Rule provides that this requirement does not apply when 
the Committee has included in its report a timely submitted 
cost estimate of the bill prepared by the Director of the 
Congressional Budget Office under section 402 of the 
Congressional Budget Act of 1974. Under clause 3(c)(3) of rule 
XIII of the Rules of the House of Representatives and section 
403 of the Congressional Budget Act of 1974, the Committee has 
received the following cost estimate for this bill from the 
Director of the Congressional Budget Office:

H.R. 2171--Exploring for Geothermal Energy on Federal Lands Act

    H.R. 2171 would exempt certain geothermal exploration 
projects from complying with provisions of the National 
Environmental Policy Act (NEPA). Based on information from the 
Bureau of Land Management (BLM), CBO estimates that 
implementing the legislation would have no significant impact 
on the federal budget. Enacting H.R. 2171 would not affect 
direct spending or revenues; therefore, pay-as-you-go 
procedures do not apply.
    Under the bill, geothermal exploration projects that meet 
certain requirements related to the duration of the activities, 
the amount of land disturbed, and the restoration of the 
project site would not be required to obtain an environmental 
impact review under NEPA. The Secretary of the Interior would 
have 10 days to review proposed projects to determine whether 
they meet the requirements necessary to obtain a NEPA 
exemption. Based on information provided by BLM, CBO estimates 
that implementing the legislation would have a negligible 
impact on the agency's workload.
    H.R. 2171 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act and 
would impose no costs on state, local, or tribal governments.
    The CBO staff contact for this estimate is Jeff LaFave. The 
estimate was approved by Theresa Gullo, Deputy Assistant 
Director for Budget Analysis.
    2. Section 308(a) of Congressional Budget Act. As required 
by clause 3(c)(2) of rule XIII of the Rules of the House of 
Representatives and section 308(a) of the Congressional Budget 
Act of 1974, this bill does not contain any new budget 
authority, spending authority, credit authority, or an increase 
or decrease in revenues or tax expenditures. CBO estimates that 
implementing the legislation would have no significant impact 
on the federal budget. Enacting H.R. 2171 would not affect 
direct spending or revenues; therefore, pay-as-you-go 
procedures do not apply.
    3. General Performance Goals and Objectives. This bill does 
not authorize funding and therefore, clause 3(c)(4) of rule 
XIII of the Rules of the House of Representatives does not 
apply.

                           EARMARK STATEMENT

    This bill does not contain any Congressional earmarks, 
limited tax benefits, or limited tariff benefits as defined 
under clause 9(e), 9(f), and 9(g) of rule XXI of the Rules of 
the House of Representatives.

                    COMPLIANCE WITH PUBLIC LAW 104-4

    This bill contains no unfunded mandates.

                PREEMPTION OF STATE, LOCAL OR TRIBAL LAW

    This bill is not intended to preempt any State, local or 
tribal law.

                        CHANGES IN EXISTING LAW

    If enacted, this bill would make no changes in existing 
law.

                            DISSENTING VIEWS

    We oppose H.R. 2171 because it would exempt certain 
geothermal exploration activities on public lands from federal 
review under the National Environmental Policy Act (NEPA). This 
is a reckless measure that would eliminate the ability of 
federal land managers to review certain projects to ensure that 
they do not threaten public health and safety, endangered 
species and critical habitat, or nearby geysers, hot springs, 
or other geothermal features of value.
    The Bureau of Land Management (BLM) currently has the 
authority to use the ``categorical exclusion'' process to 
expedite the approval of geothermal test wells when it is 
confident that drilling will not have negative unanticipated 
consequences. H.R. 2171 attempts to statutorily recreate BLM's 
technical specifications for projects eligible for this type of 
expedited processing. However, by exempting the project 
entirely from the NEPA process, the bill removes the ability 
for permitting agencies to address extraordinary circumstances 
that are beyond what is specifically mentioned in the statute. 
The BLM currently allows for 12 types of ``extraordinary 
circumstances'' that could trigger a NEPA review, including 
projects which may have significant impacts on public health or 
safety, significant impacts on park lands or unique geographic 
characteristics, and projects that have highly uncertain and 
potentially significant environmental effects. Under H.R. 2171, 
geothermal test projects would be exempted from this 
consideration.
    Before dismantling the current regulatory framework for 
permitting geothermal test well projects, it should be noted 
that most projects are currently granted expedited categorical 
exclusions. Over the last four years, the BLM has reviewed 72 
applications to drill geothermal test wells. For 49 of those 
applications, or 68 percent, a categorical exclusion or other 
expedited process was utilized for quick project approval. For 
23 projects, or 32 percent, the BLM required an environmental 
assessment prior to approving the project. Under H.R. 2171, the 
BLM would have been forced to approve those 23 projects without 
any review under NEPA regardless of the potential risks that 
these projects might present.
    We agree that in most cases, doing minimally-invasive 
renewable resource assessment activities on public lands--
including the activities covered under this bill as 
``geothermal exploration test projects''--should be encouraged 
and should not require an extended permitting schedule. 
However, there is a critically important difference between 
providing for expedited permitting most of the time, and 
exempting an entire category of projects from NEPA review all 
of the time. The approach in H.R. 2171 is the latter, which 
fails to consider the need for our federal land managers to 
have the flexibility to consider extraordinary circumstances.
    Geothermal industry groups have not endorsed H.R. 2171. In 
fact, at the legislative hearing on this bill, the geothermal 
witness stated that his industry would be very happy if, 
instead of a blanket NEPA waiver, the BLM simply used its 
current categorical exclusion authority more aggressively. That 
is an indication that implementation, rather than policy, 
should be the focus of committee work in this area. 
Furthermore, the overwhelming body of testimony that this 
committee has received with regard to renewable energy 
development on public lands has indicated that the 
effectiveness and timeliness of permitting has improved 
markedly under the current Administration.
    During the mark up of this bill, an amendment was offered 
by Ranking Member Markey that would require the Secretary of 
Interior to certify that a proposed geothermal test well 
project would not have an adverse impact on any significant 
thermal features within any unit of the National Park System. 
Since the geysers and hot springs that attract millions of 
visitors to our National Parks every year can be impacted by 
changes in the subsurface hydrology many miles away, this 
amendment would have provided these thermal features an 
important safeguard from unregulated exploratory activities 
that would now be allowed under the bill. The amendment was 
defeated 26-15, with all Republicans opposing.
    H.R. 2171 is unnecessary for permitting most exploratory 
geothermal activities and environmentally risky in rare 
circumstances where environmental analysis is necessary. The 
renewable energy industry has not suggested this solution and 
has not endorsed the legislation. We oppose it.
                                   Edward J. Markey.
                                   Gregorio Kilili Camacho Sablan.
                                   Colleen W. Hanabusa.
                                   Rush Holt.
                                   Grace F. Napolitano.
                                   Niki Tsongas.
                                   Frank Pallone, Jr.
                                   Madeleine Z. Bordallo.
                                   Betty Sutton.
                                   Ben R. Lujan.
                                   Raul M. Grijalva.
                                   John Garamendi.

                                  
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