Stoel Rives has obtained a full-length copy of the Bureau of Land Management’s (the "BLM") strategic plan for its geothermal program (the "Strategic Plan"). With approximately 90 percent of the United States’ geothermal resources located on federal lands, the Strategic Plan will, almost exclusively, guide the development of this renewable energy source in the upcoming years.
The Strategic Plan was written in response to the President’s National Energy Policy (the "NEP"). The NEP encourages a "clean and diverse portfolio of domestic energy supplies" and a re-evaluation of access limitations on federal lands in order to increase renewable energy production. Additionally, the NEP specifically recommends that the Secretary of the Interior reduce delays in geothermal lease processing when permits are under review.
The Strategic Plan addresses these recommendations by seeking to increase development of geothermal resources on BLM lands while ensuring that the program is managed in the public interest. To reach this goal, the Strategic Plan outlines five objectives:
- Provide timely exploratory leasing and development opportunities in response to present and future demands;
- Improve effectiveness and efficiency in processing applications and permits;
- Improve coordination and communication between stakeholders, shareholders, and customers;
- Provide effective and timely enforcement of its laws and regulations; and
- Develop a sustainable geothermal program, adequately staffed and funded, and maintain an appropriate level of program expertise.
To meet each of these objectives, the Strategic Plan contains 29 actions involving internal procedure, regulatory changes, and budget increases. Several of these objectives include internal reorganization and regionalization of some functions, a reprioritization of the planning schedule to address areas of high geothermal interest, and improving overall coordination with the Minerals Management Service, with an emphasis on simplifying the royalty structure for direct-use applications. Additionally, the BLM seeks to develop a consultation process with Native Americans for exploration on tribal lands, a geothermal program Web page, a comprehensive inspection and enforcement strategy, and initiatives for recruiting and training new employees to ensure continuing program expertise as current BLM personnel begin to retire.
The Strategic Plan also contains state action plans addressing the current leasing workload and anticipated operational workload. Target dates are included for processing these applications; however, the dates are contingent on additional funding. The Strategic Plan outlines the number of pending leases in each state in addition to providing projections on BLM’s workload relating to exploratory activities. The BLM anticipates a three-year extension of the production tax credit (the "PTC") upon passage of the energy bill, which will likely emerge from conference committee by July 29, 2005. Recent reports, however, indicate that conferees are considering a two-year extension of the PTC. Extension of the PTC will increase workload projections because permits and applications must be processed during this brief period. A shorter extension will further increase these projections due to the compressed timeframe for utilizing the PTC.
Though accounting for less than 1 percent of total U.S. electricity supply, geothermal energy comprises 17 percent of renewable electricity generation. The number of leases the BLM managed declined significantly during the 1990s—from more than 2000 in the mid-1980s to 414 currently—due to inexpensive conventional energy sources. With costs of conventional energy reaching record highs, the goals of the NEP, and provisions in both House (H.R. 6) and Senate (S. 10) energy bills, geothermal and other renewable energy resources will be vital to meeting the United States’ energy demands in the future.
If you have any other questions about this update or if you would like our assistance in connection with this matter, please call your Stoel Rives lawyers or one of the following lawyers:
Jennie L. Bricker at jlbricker@stoel.com or (503) 294-9631
This is a publication of Stoel Rives Energy Group for the benefit and information of clients and friends. This bulletin is not legal advice or a legal opinion on specific facts or circumstances. The contents are intended for information purposes only. Copyright 2005, Stoel Rives LLP.