Washington State Legislature Considers Changes to Geothermal Law

The Washington State legislature is considering potential changes to the state’s geothermal law (Chapter 78.60 Revised Code of Washington), following up on last year’s effort. The bill seeks to bring Washington’s law in line with federal laws and other states’ laws, as part of an effort to promote geothermal development in the state.

Washington currently defines geothermal resources as “only that natural heat energy of the earth from which it is technologically practical to produce electricity commercially…” Since current technology makes it possible to produce power at much lower temperatures than was possible when the definition was adopted in the 1970s, this definition is impractical and inconsistent with other definitions of the resource. Professor Hiatt of Harvard Business School has found that inconsistent definitions of geothermal resources are significant barriers to geothermal development. To remedy this problem, the bill would replace the current definition with one that combines federal and California definitions, similar to Oregon’s approach.

Ownership of geothermal resources would also be addressed in the bill. Under current Washington law the surface landowner owns underlying geothermal resources. The bill would authorize reservation or conveyance of geothermal resources separate from the land surface. This change would reduce risk for developers, and would avoid conflicts where geothermal resources have previously been reserved or conveyed by the federal government. The state would also benefit by being able to reserve geothermal resources — and receive income streams from geothermal development — following conveyance of state lands.

The regulation of water, which is the medium for heat transfer, is also addressed in the bill. Washington’s current law provides that Department of Natural Resources (DNR), the lead agency for geothermal projects, may not approve operation of a geothermal well that will negatively impact other uses of groundwater. This bill clarifies the circumstances in which the water code will apply to use of water for geothermal projects. It exempts certain uses of water from the appropriation procedure of the water code, based in part on Nevada law. The bill adds provisions requiring coordination between DNR and Department of Ecology, the agency changed with water management. These provisions are intended to avoid overlapping permits and duplication of effort by state agencies, while ensuring that agency concerns are discussed and addressed. 

In a housekeeping measure, the bill would renew a provision that had sunseted in the current law, authorizing the state to receive and manage a share of royalties from federal leases.  

The bill (SB 6285) can be viewed here.

Kathleen Callison is an attorney with areas of practice in water, reclaimed water, geothermal and mineral resources. She has written and spoken extensively on geothermal laws and regulations, and can be reached at Callison@CallisonLaw.com.

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