II 

113TH CONGRESS 

1ST SESSION S. 362 

To promote the mapping and development of United States geothermal resources by establishing a direct loan program for high risk geothermal 

exploration wells, to amend the Energy Independence and Security Act 

of 2007 to improve geothermal energy technology and demonstrate the 

use of geothermal energy in large scale thermal applications, and for 

other purposes. 

IN THE SENATE OF THE UNITED STATES 

FEBRUARY 14, 2013 

Mr. TESTER (for himself and Mr. BEGICH) introduced the following bill; which 

was read twice and referred to the Committee on Energy and Natural 

Resources 

A BILL 

To promote the mapping and development of United States 

geothermal resources by establishing a direct loan program for high risk geothermal exploration wells, to 

amend the Energy Independence and Security Act of 

2007 to improve geothermal energy technology and demonstrate the use of geothermal energy in large scale 

thermal applications, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 


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1 SECTION 1. SHORT TITLE. 

2 This Act may be cited as the ‘‘Geothermal Explo3 ration and Technology Act of 2013’’. 

4 SEC. 2. GEOTHERMAL EXPLORATORY DRILLING LOAN PRO5 GRAM. 

6 (a) DEFINITIONS.—In this section: 

7 (1) FUND.—The term ‘‘Fund’’ means the Geo8 thermal Investment Fund established under sub9 section (h). 

10 (2) PROGRAM.—The term ‘‘program’’ means 

11 the direct loan program for high risk geothermal ex12 ploration wells established under this section. 

13 (3) SECRETARY.—The term ‘‘Secretary’’ means 

14 the Secretary of Energy. 

15 (b) ESTABLISHMENT.—The Secretary shall establish 

16 a direct loan program for high risk geothermal exploration 

17 wells. 

18 (c) APPLICATIONS.—An applicant that seeks to re19 ceive a loan under the program may submit to the Sec20 retary an application for the loan at such time, in such 

21 form, and containing such information as the Secretary 

22 may prescribe. 

23 (d) PROJECT CRITERIA.— 

24 (1) IN GENERAL.—In selecting applicants for 

25 loans under this section to carry out projects under 

26 the program, the Secretary shall consider— 


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1 (A) the potential for unproven geothermal 

2 resources that would be explored and developed 

3 under a project; 

4 (B) the expertise and experience of an ap5 plicant in developing geothermal resources; and 

6 (C) the importance of the project in meet7 ing the goals of the Department of Energy. 

8 (2) PREFERENCE.—In selecting applicants for 

9 loans under this section to carry out projects under 

10 the program, the Secretary shall provide a pref11 erence for projects likely to lead to successful new 

12 geothermal development leading to electricity pro13 duction. 

14 (e) DATA SHARING.—Data from all exploratory wells 

15 that are carried out under the program shall be provided 

16 to the Secretary and the Secretary of the Interior for use 

17 in mapping national geothermal resources and other uses, 

18 including— 

19 (1) subsurface geologic data; 

20 (2) metadata; 

21 (3) borehole temperature data; and 

22 (4) inclusion in the National Geothermal Data 

23 System of the Department of Energy. 

24 (f) ADMINISTRATION.— 

25 (1) COST SHARE.— 


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1 (A) IN GENERAL.—The Secretary shall de2 termine the cost share for a loan made under 

3 this section. 

4 (B) HIGHER RISKS.—The Secretary may 

5 base the cost share percentage for loans made 

6 under this section on a sliding scale, with high7 er Federal shares awarded to projects with 

8 higher risks. 

9 (2) NUMBER OF WELLS.—The Secretary shall 

10 determine the number of wells for each selected geo11 thermal project for which a loan may be made under 

12 this section. 

13 (3) UNPRODUCTIVE PROJECTS.—The Secretary 

14 may grant further delays or dispense with the repay15 ment obligation on a demonstration that a selected 

16 geothermal project is unproductive. 

17 (g) LOAN REPAYMENT.— 

18 (1) COMMENCEMENT.—The recipient of a loan 

19 made under this section for a geothermal facility 

20 shall commence repayment of the loan beginning on 

21 the earlier of— 

22 (A) the date that is 4 years after the date 

23 the loan is made; or 

24 (B) the date on which the geothermal facil25 ity enters into commercial production. 


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1 (2) TERM.— 

2 (A) IN GENERAL.—Except as provided in 

3 subparagraph (B), the term of a loan made 

4 under this section shall be 4 years beginning on 

5 the applicable loan repayment commencement 

6 date under paragraph (1). 

7 (B) EXTENSION.—The Secretary may ex8 tend the term of a loan under this section for 

9 not more than 4 years. 

10 (3) USE OF LOAN REPAYMENTS.—Amounts re11 paid on loans made under this section shall be de12 posited in the Fund. 

13 (h) GEOTHERMAL INVESTMENT FUND.— 

14 (1) ESTABLISHMENT OF FUND.—There is es15 tablished in the Treasury of the United States a 

16 fund to be known as the ‘‘Geothermal Investment 

17 Fund’’, to be administered by the Secretary, to be 

18 available without fiscal year limitation and not sub19 ject to appropriation, to carry out this section. 

20 (2) TRANSFERS TO FUND.—The Fund shall 

21 consist of— 

22 (A) such amounts as are appropriated to 

23 the Fund under subsection (j); and 

24 (B) amounts repaid on loans under sub25 section (g)(3). 


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1 (3) PROHIBITION.—Amounts in the Fund may 

2 not be made available for any purpose other than a 

3 purpose described in paragraph (1). 

4 (4) ANNUAL REPORTS.— 

5 (A) IN GENERAL.—Not later than 60 days 

6 after the end of each fiscal year beginning with 

7 fiscal year 2013, the Secretary of Energy shall 

8 submit to the the Committee on Energy and 

9 Natural Resources of the Senate and the Com10 mittee on Energy and Commerce of the House 

11 of Representatives a report on the operation of 

12 the Fund during the fiscal year. 

13 (B) CONTENTS.—Each report shall in14 clude, for the fiscal year covered by the report, 

15 the following: 

16 (i) A statement of the amounts depos17 ited into the Fund. 

18 (ii) A description of the expenditures 

19 made from the Fund for the fiscal year, in20 cluding the purpose of the expenditures. 

21 (iii) Recommendations for additional 

22 authorities to fulfill the purpose of the 

23 Fund. 


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1 (iv) A statement of the balance re2 maining in the Fund at the end of the fis3 cal year. 

4 (i) GUIDELINES.— 

5 (1) IN GENERAL.—Not later than 180 days 

6 after the date of enactment of this Act, the Sec7 retary shall issue guidelines for the implementation 

8 of the program. 

9 (2) ADMINISTRATION.—The guidelines shall— 

10 (A) specify— 

11 (i) the terms and conditions that 

12 would require a higher or lower level of 

13 cost sharing under this section; 

14 (ii) the conditions under which the 

15 Secretary will allow loan modifications or 

16 forgiveness in cases in which a well cannot 

17 be used for production or injection; and 

18 (iii) the information necessary to pro19 vide a loan applicant with certainty about 

20 application of subsection (f), including the 

21 level of cost and risk that the applicant 

22 and the Secretary will assume; and 

23 (B) require that— 

24 (i) loans be provided under this sec25 tion only after the developer has committed 


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1 the share of the developer for expenditures 

2 for drilling costs; and 

3 (ii) loans for successful wells shall be 

4 repaid by the developer within a 10-year 

5 period. 

6 (j) AUTHORIZATION OF APPROPRIATIONS.—There 

7 are authorized to be appropriated to carry out this section 

8 such sums as are necessary for each of fiscal years 2013 

9 through 2022. 

10 SEC. 3. LARGE-SCALE GEOTHERMAL ENERGY. 

11 Title VI of the Energy Independence and Security 

12 Act of 2007 is amended by inserting after section 616 (42 

13 U.S.C. 17195) the following: 

14 ‘‘SEC. 616A. LARGE-SCALE GEOTHERMAL ENERGY. 

15 ‘‘(a) FINDINGS.—Congress finds that— 

16 ‘‘(1) the Geothermal Technologies Program of 

17 the Office of Energy Efficiency and Renewable En18 ergy of the Department has included a focus on di19 rect use of geothermal energy in the low-temperature 

20 geothermal energy subprogram (including in the de21 velopment of a research and development plan for 

22 the program); 

23 ‘‘(2) the Building Technologies Program of the 

24 Office of Energy Efficiency and Renewable Energy 

25 of the Department— 


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1 ‘‘(A) is focused on the energy demand and 

2 energy efficiency of buildings; and 

3 ‘‘(B) includes geothermal heat pumps as a 

4 component technology in the residential and 

5 commercial deployment activities of the pro6 gram; and 

7 ‘‘(3) geothermal heat pumps and direct use of 

8 geothermal energy, especially in large-scale applica9 tions, can make a significant contribution to the use 

10 of renewable energy but are underrepresented in re11 search, development, demonstration, and commer12 cialization. 

13 ‘‘(b) PURPOSES.—The purposes of this section are— 

14 ‘‘(1) to improve the components, processes, and 

15 systems used for geothermal heat pumps and the di16 rect use of geothermal energy; and 

17 ‘‘(2) to increase the energy efficiency, lower the 

18 cost, increase the use, and improve and demonstrate 

19 the applicability of geothermal heat pumps to, and 

20 the direct use of geothermal energy in, large build21 ings, commercial districts, residential communities, 

22 and large municipal, agricultural, or industrial 

23 projects. 

24 ‘‘(c) DEFINITIONS.—In this section: 


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1 ‘‘(1) DIRECT USE OF GEOTHERMAL ENERGY.— 

2 The term ‘direct use of geothermal energy’ means 

3 systems that use water that is at a temperature be4 tween approximately 38 degrees Celsius and 149 de5 grees Celsius directly or through a heat exchanger to 

6 provide— 

7 ‘‘(A) heating to buildings; or 

8 ‘‘(B) heat required for industrial processes, 

9 agriculture, aquaculture, and other facilities. 

10 ‘‘(2) GEOTHERMAL HEAT PUMP.—The term 

11 ‘geothermal heat pump’ means a system that pro12 vides heating and cooling by exchanging heat from 

13 shallow ground or surface water using— 

14 ‘‘(A) a closed loop system, which transfers 

15 heat by way of buried or immersed pipes that 

16 contain a mix of water and antifreeze; or 

17 ‘‘(B) an open loop system, which circulates 

18 ground or surface water directly into the build19 ing and returns the water to the same aquifer 

20 or surface water source. 

21 ‘‘(3) LARGE-SCALE APPLICATION.—The term 

22 ‘large-scale application’ means an application for 

23 space or process heating or cooling for large entities 

24 with a name-plate capacity, expected resource, or 

25 rating of 10 or more megawatts, such as a large 


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1 building, commercial district, residential community, 

2 or a large municipal, agricultural, or industrial 

3 project. 

4 ‘‘(4) SECRETARY.—The term ‘Secretary’ means 

5 Secretary of Energy, acting through the Assistant 

6 Secretary for Energy Efficiency and Renewable En7 ergy. 

8 ‘‘(d) PROGRAM.— 

9 ‘‘(1) IN GENERAL.—The Secretary shall estab10 lish a program of research, development, demonstra11 tion, and commercial application for geothermal heat 

12 pumps and the direct use of geothermal energy. 

13 ‘‘(2) AREAS.—The program may include re14 search, development, demonstration, and commercial 

15 application of— 

16 ‘‘(A) geothermal ground loop efficiency im17 provements through more efficient heat transfer 

18 fluids; 

19 ‘‘(B) geothermal ground loop efficiency im20 provements through more efficient thermal 

21 grouts for wells and trenches; 

22 ‘‘(C) geothermal ground loop installation 

23 cost reduction through— 

24 ‘‘(i) improved drilling methods; 


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1 ‘‘(ii) improvements in drilling equip2 ment; 

3 ‘‘(iii) improvements in design method4 ology and energy analysis procedures; and 

5 ‘‘(iv) improved methods for deter6 mination of ground thermal properties and 

7 ground temperatures; 

8 ‘‘(D) installing geothermal ground loops 

9 near the foundation walls of new construction 

10 to take advantage of existing structures; 

11 ‘‘(E) using gray or black wastewater as a 

12 method of heat exchange; 

13 ‘‘(F) improving geothermal heat pump sys14 tem economics through integration of geo15 thermal systems with other building systems, 

16 including providing hot and cold water and re17 jecting or circulating industrial process heat 

18 through refrigeration heat rejection and waste 

19 heat recovery; 

20 ‘‘(G) advanced geothermal systems using 

21 variable pumping rates to increase efficiency; 

22 ‘‘(H) geothermal heat pump efficiency im23 provements; 


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1 ‘‘(I) use of hot water found in mines and 

2 mine shafts and other surface waters as the 

3 heat exchange medium; 

4 ‘‘(J) heating of districts, neighborhoods, 

5 communities, large commercial or public build6 ings (including office, retail, educational, gov7 ernment, and institutional buildings and multi8 family residential buildings and campuses), and 

9 industrial and manufacturing facilities; 

10 ‘‘(K) geothermal system integration with 

11 solar thermal water heating or cool roofs and 

12 solar-regenerated desiccants to balance loads 

13 and use building hot water to store geothermal 

14 energy; 

15 ‘‘(L) use of hot water coproduced from oil 

16 and gas recovery; 

17 ‘‘(M) use of water sources at a tempera18 ture of less than 150 degrees Celsius for direct 

19 use; 

20 ‘‘(N) system integration of direct use with 

21 geothermal electricity production; and 

22 ‘‘(O) coproduction of heat and power, in23 cluding on-site use. 

24 ‘‘(3) ENVIRONMENTAL IMPACTS.—In carrying 

25 out the program, the Secretary shall identify and 


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1 mitigate potential environmental impacts in accord2 ance with section 614(c). 

3 ‘‘(e) GRANTS.— 

4 ‘‘(1) IN GENERAL.—The Secretary shall make 

5 grants available to State and local governments, in6 stitutions of higher education, nonprofit entities, 

7 utilities, and for-profit companies (including manu8 facturers of heat-pump and direct-use components 

9 and systems) to promote the development of geo10 thermal heat pumps and the direct use of geo11 thermal energy. 

12 ‘‘(2) PRIORITY.—In making grants under this 

13 subsection, the Secretary shall give priority to pro14 posals that apply to large buildings (including office, 

15 retail, educational, government, institutional, and 

16 multifamily residential buildings and campuses and 

17 industrial and manufacturing facilities), commercial 

18 districts, and residential communities. 

19 ‘‘(3) NATIONAL SOLICITATION.—Not later than 

20 180 days after the date of enactment of this section, 

21 the Secretary shall conduct a national solicitation for 

22 applications for grants under this section. 

23 ‘‘(f) REPORTS.— 

24 ‘‘(1) IN GENERAL.—Not later than 2 years 

25 after the date of enactment of this section and annuVerDate Mar 15 2010 01:48 Feb 27, 2013 Jkt 029200 PO 00000 Frm 00014 Fmt 6652 Sfmt 6201 E:\BILLS\S362.IS S362

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1 ally thereafter, the Secretary shall submit to the 

2 Committee on Energy and Natural Resources of the 

3 Senate and the Committee on Science and Tech4 nology of the House of Representatives a report on 

5 progress made and results obtained under this sec6 tion to develop geothermal heat pumps and direct 

7 use of geothermal energy. 

8 ‘‘(2) AREAS.—Each of the reports required 

9 under this subsection shall include— 

10 ‘‘(A) an analysis of progress made in each 

11 of the areas described in subsection (d)(2); and 

12 ‘‘(B)(i) a description of any relevant rec13 ommendations made during a review of the pro14 gram; and 

15 ‘‘(ii) any plans to address the rec16 ommendations under clause (i). 

17 ‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There 

18 are authorized to be appropriated to the Secretary to carry 

19 out this section such sums as are necessary for each of 

20 fiscal years 2013 through 2017.’’. 

21 SEC. 4. FACILITATION OF COPRODUCTION OF GEO22 THERMAL ENERGY ON OIL AND GAS LEASES. 

23 Section 4(b) of the Geothermal Steam Act of 1970 

24 (30 U.S.C. 1003(b)) is amended by adding at the end the 

25 following: 


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1 ‘‘(4) LAND SUBJECT TO OIL AND GAS LEASE.— 

2 Land under an oil and gas lease issued pursuant to 

3 the Mineral Leasing Act (30 U.S.C. 181 et seq.) or 

4 the Mineral Leasing Act for Acquired Lands (30 

5 U.S.C. 351 et seq.) that is subject to an approved 

6 application for permit to drill and from which oil 

7 and gas production is occurring may be available for 

8 leasing under subsection (c) by the holder of the oil 

9 and gas lease— 

10 ‘‘(A) on a determination that— 

11 ‘‘(i) geothermal energy will be pro12 duced from a well producing or capable of 

13 producing oil and gas; and 

14 ‘‘(ii) the public interest will be served 

15 by the issuance of such a lease; and 

16 ‘‘(B) in order to provide for the coproduc17 tion of geothermal energy with oil and gas.’’. 

Æ 


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