A Review And Analysis Of The Adequacy Of The Us Legal, Institutional And Financial Framework For Geothermal Development

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Journal Article: A Review And Analysis Of The Adequacy Of The Us Legal, Institutional And Financial Framework For Geothermal Development

Abstract
The legal and institutional framework within which geothermal energy in the United States must develop had its origin in the early 1970s. The first impetus for the establishment of such a framework was the early successful development of The Geysers geothermal field in northern California. The second impetus came from the oil embargo of 1972 which also raised the demand for the establishment of federal and state financial incentives to encourage more rapid development of geothermal energy. The legal and institutional framework developed by the states and the federal government often differed substantially in format, content, and direction. Too often the legal and institutional framework established left as many questions unanswered as answered, and in some cases, the framework has proven to be more of an obstacle to development than an aid. From an examination of how the states and the federal government have addressed the needs of geothermal development, and how the courts have interpreted some of their decisions, it has become clear that in order to ensure that the legal and institutional framework is adequate to serve the needs of geothermal development, it must address, at a minimum, the following topics: 1. (1) providing developers with access and a priority right to carry out exploration and development activities; 2. (2) carefully characterizing the resources so as to minimize conflicts with other natural resources; 3. (3) establishing ownership; and 4. (4) giving careful consideration to such lease terms as rentals and royalties, renewals, and diligence requirements. In addition, the framework must address groundwater law and its implications for geothermal development, and how geothermal development will be considered in terms of established utility law. Providing financial incentives to ensure rapid growth of the geothermal industry is another task which the states and the federal government have addressed. Several types of programs can be used. These include grants, loans, guaranteed loans, tax incentives and insurance. Two major conclusions which have emerged from an analysis of the varying programs and types of programs is that no single program can meet the needs of every type of developer, and that to be successful, the program developed must address the financial needs of the developer from exploration through development.

Author 
R. Gordon Bloomquist








Published Journal 
Geothermics, 1986





DOI 
Not Provided
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Citation

R. Gordon Bloomquist. 1986. A Review And Analysis Of The Adequacy Of The Us Legal, Institutional And Financial Framework For Geothermal Development. Geothermics. (!) .