Regulatory Roadmap Project Overview October 2, 2012

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1 Geothermal Technologies Program Public Service of Colorado Ponnequin Wind Farm Regulatory Roadmap Project Overview October 2, US DOE Geothermal Program Kate Young Kermit Witherbee NREL eere.energy.gov

2 Schedule Progress shown by dark bands after each jurisdiction Target dates are shown for development of materials and upcoming meetings Roadmap Development Status Mee2ngs* 25% Last Updated: October 2, % 75% 100% Reviewed & Printed Mee4ng #1 Agency Follow- up Mee4ng #2 Federal 5/3 6/7 California 6/14 6/27 Nevada 6/29 7/12 7/24 Hawaii 7/13 7/26 8/7 Alaska 7/27 8/9 8/21 Idaho 8/10 8/23 9/4 Utah 8/24 9/6 9/18 Oregon 9/1 9/13 9/25 Montana 9/14 9/20 NA * Mee4ng #1: Meet with agencies to introduce project and review developed flowcharts Mee4ng #2: Meet with industry to introduce project and get feedback on permirng concerns; meet with agencies and industry together to discuss concerns and poten4al solu4ons 2 US DOE Geothermal Program eere.energy.gov

3 Early Results Leasing & Royal4es BLM Compe44ve Lease Sale Reno, BLM State Office August 14, 2007 In many states, royal4es benefit schools, teachers, and public educa4on Photo credit: Kermit Witherbee 3 US DOE Geothermal Program eere.energy.gov

4 Early Results BLM Lease Nomina4ons 4 US DOE Geothermal Program eere.energy.gov

5 Early Results 5 US DOE Geothermal Program eere.energy.gov

6 Early Results: Surface and Mineral Ownership Minerals: Federal Surface State Surface Private Surface Tribal Surface Federal State Private Tribal Federal State Private Tribal Federal State Private Tribal Federal State Private Tribal Unclassified Total (in State) California Nevada Hawaii Alaska Idaho Utah Oregon Montana UNITS: millions of acres/ Source: hdp:// hdps:// state- trust- lands/ 6 US DOE Geothermal Program eere.energy.gov

7 Early Results: Leasing Federal California Nevada Hawai i Alaska Idaho Utah Oregon Montana BLM Agency Compe22ve Lease Land Non- Compe22ve Lease Land Lands nominated by: Lease parcels not sold at compe44ve sale are Formal nomina4on available for 2- year period Bureau mo4on Mining claims by qualified mining claimants State Lands Commission Department of Land and Natural Resources Department of Natural Resources Division of Lands State Board of Land Commissioners Utah School and Ins4tu4onal Trust Lands Division of State Lands Board of Land Commissioners Lands selected by the State Lands Commission No leasing regula:ons, may be available by contract State lands and reserved lands (for non- land occupiers) Areas designated by DNR KGRAs and compe44ve interest Known geothermal area lands (withdrawn lands) nominated for leasing Designated geothermal resource areas State lands nominated by industry for geothermal leasing Private Mineral Interest Owners Nego4a4on with mineral interest owners Lands within an explora4on permit area with geothermal discovery (preference rights leasing) State lands and reserved lands (occupier of the land of assignee upon two- thirds vote by the Board members) Lands within an prospec4ng permit area with geothermal discovery (preference rights leasing) Areas not in KGRA or compe44ve interest Non- withdrawn lands available Non- designated lands (priority to first qualified applicant) Nominated lands that did not generate interest for compe44ve bid (nominator may nego4ate with Board) Tribal Source: hdps:// state- trust- lands/ BIA or Tribe Leasing through nego4a4on with Tribes and Bureau of Indian Affairs 7 US DOE Geothermal Program eere.energy.gov

8 Early Results: Royalties Royalty Calcula2on Basis Distribu2on Federal EPAC Leases & Converted Leases: First 10 years of produc4on: 1.75% Years 11+: 3.5% Pre EPACT Leases (not converted): 10% Sales Value Net Back 50% state 25% county 25% treasury California Compe44ve: 16.66% Non- compe44ve: 10% Gross Revenue (sales value) Teachers Re4rement Fund Nevada No statutory authority Hawai i Alaska Idaho Utah Set by State Land Board 10% 20% (adjusted aner 35 years) First 10 years of produc4on: 1.75% Years 11+: 3.5% Primary term: 10% Renewable term: 15% Set royalty: 10% ($4/acre min.) Oregon Set royalty: 10% Montana Set royalty: 10% ($2/acre min.) Gross Proceeds (net back) Gross Proceeds (net back) Value of Resource (sales value) Gross Value (sales proceeds) Produc4on Value (gross sales price) Gross Revenue (sales price) Public educa4on, benefi4ng na4ve Hawaiians, public lands Public schools, mental health Schools, hospitals Schools, hospitals, public buildings Schools Public educa4on, hospitals Private Variable: 3% 15% Lease Terms Mineral owner(s) Tribal Nego4ated (may be equivalent of federal) Lease Terms Tribe or alloqed Indian owner(s) 8 US DOE Geothermal Program eere.energy.gov

9 Early Results Explora4on Photo credit: Ram Power Orita Project Imperial Valley CA 9 US DOE Geothermal Program eere.energy.gov

10 Early Results: Water Rights Is a water right needed to divert (pump) geothermal fluid? Notes Federal California No No Nevada Yes Unless all fluids are re- injected Hawaii Alaska Idaho Utah No/Yes No/Yes No/Yes Yes Water appropria4on required for direct use projects unless outside of a Water Management Area or the water is used solely for domes4c consump4on If geothermal fluid is <248 F, fluid is considered a water resource If geothermal fluid is <212 F, fluid is considered a water resource. Oregon No/Yes If geothermal fluid is <250, fluid is considered a water resource Montana Yes 10 US DOE Geothermal Program eere.energy.gov

11 Early Results: Exploration Environmental Review Req d PHASE 2: Prospect Evalua2on PHASE 3: Prospect Appraisal PHASE 4: Explora2on Drilling e.g. Field Mapping, Water Sampling e.g. Geophysical e.g. TGHs, Core Holes Descrip:on Federal NEPA No4ce of Intent California CEQA (permit req. on state lands) No4ce of Intent Nevada UEPA (permit req. on state and county lands) Well Drilling Permit 2,3 wells not penetra:ng the resource <6 wells 1/2 mile from prod. wells Not specified Hawaii HEPA (permit req. on state lands) Explora4on Permit <500 U deep 5 Alaska no formal 1 Geophysical Explora4on Permit Idaho no formal 1 (permit req. on state and county lands) Utah no formal 1 (permit req. on state and county lands) Oregon no formal 1 (permit req. on state lands) Geothermal Explora4on Permit Montana MEPA NOI, Geophysical Explora4on Permit Geothermal Explora4on Permit No4ce of Intent No4ce of Intent Geothermal Prospect Well Permit 4 Drilling Permit 3 1 Although no formal environmental process exists, many federal environmental considera4ons must be met (e.g. ESA, CAA, CWA, etc.) 2 Also may required: Temporary Use of Groundwater for Explora4on, Monitoring Well Waiver, Geothermal Project Area Permit 3 Blue boxes indicate geothermal drilling permits (i.e. the permit required for explora4on drilling does not differ from produc4on well drilling) 4 Also may be required: Explora4on Injec4on Permit 1500 U; no resource encountered <6" diameter; <1000 U deep TGH: <500 U deep 5 Not specified Not specified 11 US DOE Geothermal Program eere.energy.gov

12 Early Results: Exploration Determina2on of NEPA Adequacy Categorical Exclusion Environmental Assessment Environmental Impact Statement 1-3 months Small updates to ac4vi4es with exis4ng NEPA 1-6 months Gravity; MT; TGW with no new surface disturbance 6-12 months u4liza4on Seismic, TGW, development wells, months Power Plant Construc4on Transmission Construc4on 12 US DOE Geothermal Program eere.energy.gov

13 Early Results: Environmental Environmental Process Photo credit: Pearson Education Inc. 13 US DOE Geothermal Program eere.energy.gov

14 Early Results: Environmental Descrip2on Kickoff Mee2ng Convene relevant par4es Expert Evalua2ons Cultural Resources Biological Resources Water Resources Air Quality Waste & Hazardous Waste Geological Resources Aesthe4c Resources Previous Land Uses Effects Analysis Dra] Report Determine effects and poten4al alterna4ves and/ or mi4ga4on Contractor drans formal EA/ EIS Agency Review Agencies review EA/EIS Public Comment May be one or mul4ple public comment periods All Projects 1-3 months Formal Environmental Process FD, CA, NV, HI, MT 1-2 months 1-4 months 1 month 0-2 months 0-6 months 0-3 months TOTAL TIME 1-3 Months 3-18 months 14 US DOE Geothermal Program eere.energy.gov

15 Early Results: Environmental DEVELOPER ACTIVITIES Explora4on: Phase 2 Explora4on: Phase 3 Explora4on: Phase 4 Drilling Plant Construc4on, Tes4ng Transmission Construc4on PERMITTING ACTIVITIES Federal Land Leasing Right- of- Way (ROW) Access State Land Access (ROWs) Encroachment Permit Explora4on Applica4on Process- BLM State Explora4on Process Temporary Use of Ground Water for Explora4on Monitoring Well Waiver Drilling Applica4on Process Drilling/Well- Development Sundry No4ce EPA Construc4on Stormwater Transporta4on Stormwater Drinking Water Permit Construc4on Permit (may be local) U4liza4on Applica4on Process Plant Commissioning Process Permit to Construct and Permit to Operate Leasing Seismic Field work Geophysics TGH TGH GDP Drill well field Transmission ROW U4liza4on State PUC Process NEPA Process DNA NEPA NEPA NEPA NEPA Environmental (EA) Process EA - NOI EA - Geophysical EA - NOI (GW GDP Environmental Impact EIS - U4liza4on and Transmission Statement (EIS) Process Plant Constsruc2on Transmission Construc2on 15 US DOE Geothermal Program eere.energy.gov

16 Early Results: Environmental DISCUSSION: Why are NEPA 2melines so long? Elimina4on of Categorical Exclusions (~1991) drilling TG and Explora4on/Development Wells Lack of resources Trained staff Budget Compe4ng staff responsibili4es Changes in Policy Li4ga4on seqlements requiring addi4onal s4pula4ons Increases in special status species (flora and fauna) Legisla4ve policy (clean air, clean water, consulta4ons, etc.) 16 US DOE Geothermal Program eere.energy.gov

17 Early Results: Environmental DISCUSSION: Sugges2ons for shortening NEPA 2melines Combining NEPA documents (internal policy), for example: Leasing and non- drilling explora4on Explora4on and produc4on drilling Increased funding (rulemaking) Ins4tute permit fees Implement cost recovery Improve categorical exclusions (rulemaking) Harmonize categorical exclusions Increase number of available categorical exclusions: analysis of effec4veness of s4pula4ons for geothermal permirng, similar to oil and gas Move authority for NEPA to the state office level (internal policy) More available and redundant staff posi4ons Allows for more experienced personnel Promotes consistency in implementa4on; reduce personal bias Develop consistent 4melines Increase state office oversight Appoint permit/nepa shepherds (internal policy) 17 US DOE Geothermal Program eere.energy.gov

18 Analysis Suggestions? Suggested improvements to current analyses? Other ideas for analyses? Other ideas for displaying results? Anything else? 18 US DOE Geothermal Program eere.energy.gov