Bill Text: CA AB526 | 2025-2026 | Regular Session | Introduced
Bill Title: Energy: new in-state geothermal energy generation.
Spectrum: Partisan Bill (Democrat 2-0)
Status: (Introduced) 2025-03-03 - Referred to Coms. on U. & E. and NAT. RES. [AB526 Detail]
Download: California-2025-AB526-Introduced.html
CALIFORNIA LEGISLATURE—
2025–2026 REGULAR SESSION
Assembly Bill
No. 526
| Introduced by Assembly Member Papan (Coauthor: Assembly Member Rogers) |
February 10, 2025 |
An act to add Chapter 16 (commencing with Section 25993) to Division 15 of the Public Resources Code, relating to energy.
LEGISLATIVE COUNSEL'S DIGEST
AB 526, as introduced, Papan.
Energy: new in-state geothermal energy generation.
Existing law establishes a state policy that eligible renewable energy resources and zero-carbon resources supply 90% of all retail sales of electricity to California end-use customers by December 31, 2035, 95% of all retail sales of electricity to California end-use customers by December 31, 2040, 100% of all retail sales of electricity to California end-use customers by December 31, 2045, and 100% of electricity procured to serve all state agencies by December 31, 2035, as provided. Existing law requires the Public Utilities Commission (PUC), State Energy Resources Conservation and Development Commission (Energy Commission), and State Air Resources Board to issue a joint report to the Legislature by January 1, 2021, and every 4 years thereafter, that includes specified information relating to the implementation of that state policy.
Existing law
requires the PUC and the Energy Commission to undertake various actions in furtherance of meeting the state’s clean energy and pollution reduction objectives.
This bill would require the Energy Commission, in coordination with specified agencies, to develop a strategic plan for the development of new in-state geothermal energy, as defined, in California. The bill would require the Energy Commission to submit the strategic plan to the Natural Resources Agency and the Legislature on or before June 30, 2027.
The bill would require the Energy Commission, on or before June 1, 2026, to evaluate and quantify the maximum feasible capacity of new in-state geothermal energy to achieve reliability, ratepayer, employment, and decarbonization benefits, and to establish megawatt in-state next-generation geothermal planning goals for 2035 and 2045, as specified.
The bill would require the Energy
Commission, in coordination with specified agencies, to work with stakeholders, other relevant federal, state, and local agencies, California load-serving entities, and the geothermal energy industry to identify suitable and recommended locations for the development of new in-state geothermal energy, to establish state lands leasing goals for new in-state geothermal energy development for 2035 and 2045 to accommodate the 2035 and 2045 new in-state geothermal energy planning goals, and to identify opportunities to work with federal agencies on the timing, scope, and prioritization of geothermal lease sales to support geothermal development on federal lands within California, as specified. The bill would require the Energy Commission, in consultation with the PUC and the Independent System Operator (ISO), to assess the transmission investments and upgrades necessary to support the 2035 and 2045 new in-state geothermal energy planning goals, as specified. The bill would require the PUC to designate new in-state
geothermal energy as a long lead-time resource in its input to the ISO interconnection queue prioritization, and would require the ISO to reserve appropriate capacity for new in-state geothermal energy in its transmission plan deliverability allocation, to accommodate the 2035 and 2045 new in-state geothermal energy planning goals, as specified. The bill would require the Energy Commission, in coordination with specified entities, to develop and produce a permitting roadmap that describes timeframes and milestones for a coordinated, comprehensive, and efficient permitting process for new in-state geothermal energy exploration and field development and associated electricity and transmission infrastructure, as provided. The bill would require the Energy Commission, in coordination with the State Lands Commission, the Department of Conservation, and the Governor’s Office of Business and Economic Development, to assess the level at which geothermal rentals and royalties would best support California’s long-term
renewable energy and greenhouse gas emissions reduction goals, including the 2035 and 2045 new in-state geothermal energy planning goals, while maintaining competitiveness with rentals and rates on federal lands and in other states, as provided. The bill would authorize the State Lands Commission to reduce the geothermal rentals and royalties to reflect the findings of the assessment. The bill would require the information described in this paragraph and an assessment of known impacts to Native American and indigenous peoples and biological resources, and strategies for addressing those impacts, to be included in the strategic plan, as specified.
Digest Key
Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: NOBill Text
The people of the State of California do enact as follows:
SECTION 1.
The Legislature finds and declares all of the following:(a) The State of California and its consumers of electricity have a significant and growing need for clean “firm” energy that can reliably meet demand, regardless of the time of day, season, or weather.
(b) The need for reliable firm energy was the driving force behind recent extensions of the lifespan of the Diablo Canyon Power Plant and a number of natural gas-fired powerplants in southern California.
(c) In recognition of this need, the Public Utilities Commission recently issued decisions 21-06-035 (June 24, 2021), Decision Requiring Procurement to
Address Mid-Term Reliability (2023-2026), and 24-08-064 (August 22, 2024), Decision Determining Need for Centralized Procurement of Long Lead-Time Resources, which directed California’s load-serving entities and the Department of Water Resources to procure significant amounts of new geothermal energy over the years to come.
(d) If developed and deployed at scale, new in-state geothermal energy can provide significant energy affordability benefits to the state and local communities, in addition to advancing California’s progress toward its statutory renewable energy and climate mandates and providing air quality benefits.
(e) The recent United States Department of Energy report from March 2024, Pathways to Commercial Liftoff: Next-Generation Geothermal Power, highlighted research that found that aggressive deployment of next-generation geothermal energy technologies could lower the
cost of eliminating carbon emissions in the Western Interconnection by as much as 25 percent compared to the status quo without it.
(f) Resources providing “clean firm” reliability are often among the most expensive on the market today, driving up ratepayer costs. New in-state geothermal energy can provide many of those same attributes while helping to limit ratepayer costs over time.
(g) The resource portfolios identified by the Public Utilities Commission to meet state climate goals are increasingly relying on out-of-state geothermal energy development, which both puts California’s climate goals at risk and establishes an unnecessary but permanent export of wealth by California ratepayers.
(h) The first commercial-scale next-generation geothermal energy resources are currently under development in Nevada and Utah
due to those states’ favorable regulatory environments, but nearly all of that power is anticipated to be sold to buyers in California.
(i) The state of California must take an active role in ensuring that new geothermal energy projects built to supply the California market lead to investment and job creation in California and do not lead to the export of investment, industry knowledge, and the California geothermal, oil, and gas workforce to neighboring states.
(j) New in-state geothermal energy development presents a significant opportunity to attract investment capital and realize community economic development and workforce development benefits in California, including the development and preservation of a skilled and trained construction workforce to carry out projects, long-term apprenticeship and job creation, and the development of a next-generation geothermal energy
supply chain.
(k) California launched the global revolution in conventional geothermal technologies in the twentieth century. It has the geologic resources, workforce, and clean energy economy to do so again in the twenty-first century if decisive state action is taken today. The National Renewable Energy Laboratory estimates that there could be 27.9 gigawatts of development of next-generation geothermal resources in California by 2050, over double that of any other state.
(l) Without urgent and decisive state action, California’s load-serving entities may not be on track to secure the necessary amounts of new in-state geothermal energy to reach California’s ambitious climate goals. Since many next-generation geothermal energy projects take a decade or more to construct, a comprehensive planning process must begin now to ensure an adequate in-state supply of geothermal energy when
it is needed. Given the geographic constraints on geothermal energy resources, it is also critical that planning begin now in order to ensure that adequate transmission capacity is in place to ensure interconnection once projects are completed.
SEC. 2.
Chapter 16 (commencing with Section 25993) is added to Division 15 of the Public Resources Code, to read:CHAPTER 16. New In-State Geothermal Energy Generation
25993.
For purposes of this chapter, the following definitions apply:(a) “New in-state geothermal energy” is the development of new geothermal resources in the state of California, including, but not limited to, the application of nascent technologies such as advanced closed-loop and enhanced geothermal systems and integrated thermal energy storage to generate energy from geothermal resources.
(b) “Stakeholder” means any person or organization interested in or affected by the development of next-generation geothermal energy, including, but not limited to, labor unions, industry, environmental organizations, and environmental justice organizations.
25993.1.
(a) (1) The commission, in coordination with the Department of Conservation, the State Lands Commission, the Office of Land Use and Climate Innovation, the Department of Fish and Wildlife, the Governor’s Office of Business and Economic Development, the Independent System Operator, the Public Utilities Commission, and any other relevant federal, state, and local agencies, as needed, shall develop a strategic plan for the development of new in-state geothermal energy in California.(2) Development of the strategic plan shall incorporate, but not delay, progress to advance development of new in-state geothermal energy in other relevant policy venues.
(b) (1) The commission shall submit the strategic plan to the Natural Resources Agency and the Legislature on or before June 30, 2027.
(2) The plan submitted to the Legislature pursuant to paragraph (1) shall be submitted in compliance with Section 9795 of the Government Code.
(c) The strategic plan shall include, at the minimum, all of the following chapters:
(1) Identification of suitable and recommended locations for the development of new in-state geothermal energy, including the findings and recommendations resulting from activities undertaken pursuant to Section 25993.3. This shall include state lands leasing goals for new in-state geothermal energy development for 2035 and 2045, and identification of the necessary levels of exploratory well drilling, technology piloting, and
other data acquisition to derisk potential opportunities.
(2) Economic and workforce development, including, but not limited to, an analysis of occupational safety requirements, the need to require the use of a skilled and trained workforce to perform all work, and the need for the Division of Apprenticeship Standards to develop curriculum for in-person classroom and laboratory advanced safety training for workers.
(3) Ratepayer affordability benefits and impacts, including the necessity of identifying and constructing new renewable or carbon-free reliability resources that can provide energy at lower costs than what has been historically available.
(4) Transmission planning, including the findings and recommendations resulting from activities undertaken pursuant to Section 25993.4.
(5) Permitting, including the findings and recommendations resulting from activities undertaken pursuant to Section 25993.5.
(6) Rentals and royalties, including the findings and recommendations resulting from activities undertaken pursuant to Section 25993.6.
(7) Assessment of known impacts to Native American and indigenous peoples and biological resources, and strategies for addressing those impacts.
(d) The strategic plan shall emphasize and prioritize near-term actions, particularly related to workforce development and ratepayer affordability, to accommodate the probable immediate need for jobs, economic development, and affordability of electricity bills.
(e) The development of the
strategic plan regarding workforce development shall include consultation with representatives of key labor organizations and apprenticeship programs that would be involved in dispatching and training the workforce.
(f) The commission shall provide an opportunity for public review and comment on a draft strategic plan.
25993.2.
(a) On or before June 1, 2026, the commission shall evaluate and quantify the maximum feasible capacity of new in-state geothermal energy to achieve reliability, ratepayer, employment, and decarbonization benefits, and shall establish megawatt in-state next-generation geothermal planning goals for 2035 and 2045.(b) In establishing the goals pursuant to subdivision (a), the commission shall consider all of the following:
(1) The findings of the most recent joint report issued pursuant to Section 913.11 of the Public Utilities Code.
(2) The need to develop an in-state skilled and trained next-generation geothermal
energy workforce.
(3) The potential to attract supply-chain manufacturing for next-generation geothermal energy components.
(4) The need to limit electrical ratepayer bill increases and reduce costs where possible.
(5) The need for reliable renewable energy that accommodates California’s shifting peak load.
(6) The generation profile of new in-state geothermal energy in California.
(7) The need for economies of scale to reduce the costs of next-generation geothermal energy.
(8) The need to initiate long-term transmission and infrastructure planning to facilitate delivery of new in-state geothermal energy to Californians.
(9) The availability of federal tax and other incentives for new in-state geothermal energy.
(10) The United States Department of Energy report from March 2024, Pathways to Commercial Liftoff: Next-Generation Geothermal Power and available assessments of next-generation geothermal energy potential in California.
(11) Any executive action from the Governor regarding geothermal energy.
(12) Any procurement orders from the Public Utilities Commission that include geothermal energy.
(13) Known impacts on Native American and indigenous peoples and biological resources, and strategies for addressing those impacts.
(14) The need for
the state to develop a diverse portfolio of renewable energy technologies in order to affordably meet state climate goals.
(15) The political, economic, and schedule risks of relying on out-of-state resources to provide renewable energy and reliability.
25993.3.
(a) The commission, in coordination with the Department of Conservation, the Department of Fish and Wildlife, and the State Lands Commission, shall work with stakeholders, other relevant federal, state, and local agencies, as needed, California load-serving entities, and the geothermal energy industry to identify suitable and recommended locations for the development of new in-state geothermal energy to accommodate the planning goals established pursuant to Section 25993.2.(b) The State Lands Commission, in coordination with the commission, the Department of Conservation, the Department of Fish and Wildlife, stakeholders, other relevant federal, state, and local agencies, as needed, California load-serving entities, and the geothermal energy
industry, shall establish state lands leasing goals for new in-state geothermal energy development for 2035 and 2045 to accommodate the planning goals established pursuant to Section 25993.2, and shall identify opportunities to work with the Bureau of Land Management and other relevant federal agencies on the timing, scope, and prioritization of geothermal lease sales to support geothermal development on federal lands within California.
(c) In identifying suitable locations, the commission and the State Lands Commission shall consider all of the following:
(1) Existing data on geothermal energy resource potential and commercial viability.
(2) Existing and necessary transmission infrastructure.
(3) Protection of cultural and biological resources with the
goal of prioritizing least-conflict areas.
(4) With regards to future transfers of land from the federal government to the state, opportunities to prioritize transfers of land that include significant geothermal resources.
(d) The commission, in coordination with the Department of Conservation, the Department of Fish and Wildlife, the State Lands Commission, stakeholders, other relevant federal, state, and local agencies, as needed, California load-serving entities, and the geothermal energy industry, shall make recommendations regarding potential significant adverse environmental impacts and use conflicts, such as avoidance, minimization, monitoring, mitigation, and adaptive management, consistent with California’s long-term renewable energy, greenhouse gas emissions reduction, and biodiversity goals.
(e) This
section does not modify the authority of state agencies over project-specific siting and permitting.
(f) The findings and recommendations resulting from activities undertaken pursuant to this section shall be included in the chapter of the strategic plan related to identification of suitable and recommended locations for the development of new in-state geothermal energy, as specified in paragraph (1) of subdivision (c) of Section 25993.1.
25993.4.
(a) The commission, in consultation with the Public Utilities Commission and the Independent System Operator, shall assess the transmission investments and upgrades necessary to support the 2035 and 2045 new in-state geothermal energy planning goals established pursuant to Section 25993.2.(b) The Public Utilities Commission, in consultation with the commission, the Independent System Operator, and the Department of Water Resources, shall designate new in-state geothermal energy as a long lead-time resource in its input to the Independent System Operator interconnection queue prioritization to accommodate the planning goals established pursuant to Section 25993.2.
(c) The
Independent System Operator, in consultation with the commission, the Public Utilities Commission, and the Department of Water Resources, shall reserve appropriate capacity for new in-state geothermal energy in its transmission plan deliverability allocation to accommodate the planning goals established pursuant to Section 25993.2.
(d) The commission, in coordination with the Public Utilities Commission, the Independent System Operator, the Department of Conservation, the Department of Fish and Wildlife, the State Lands Commission, stakeholders, other relevant federal, state, and local agencies, as needed, California load-serving entities, and the geothermal energy industry, shall make recommendations regarding potential significant adverse environmental impacts and use conflicts, such as avoidance, minimization, monitoring, mitigation, and adaptive management, consistent with California’s long-term renewable energy, greenhouse gas emissions
reduction, and biodiversity goals.
(e) This section does not modify the authority of state agencies over project-specific siting and permitting.
(f) The findings resulting from activities undertaken pursuant to this section shall be included in the chapter of the strategic plan related to transmission planning as specified in paragraph (4) of subdivision (c) of Section 25993.1.
25993.5.
(a) The commission, in coordination with the Department of Conservation, the Department of Fish and Wildlife, the State Lands Commission, other relevant federal, state, and local agencies, as needed, California load-serving entities, interested Native American tribes, and the geothermal energy industry, shall develop and produce a permitting roadmap that describes timeframes and milestones for a coordinated, comprehensive, and efficient permitting process for new in-state geothermal energy exploration and field development and associated electricity and transmission infrastructure.(b) The permitting roadmap shall update relevant rules and regulations to reflect emerging next-generation technologies and include goals for relevant permitting
timeframes, clearly define local, state, and federal agency roles, responsibilities, and decision-making authority, and include interfaces with federal agencies, including timing, sequence, and coordination with federal permitting agencies, and coordination between reviews under the California Environmental Quality Act (Division 13 (commencing with Section 21000)) and the federal National Environmental Policy Act of 1969 (42 U.S.C. Sec. 4321 et seq.).
(c) The commission shall provide an opportunity for stakeholder input in the development and communication of the permitting roadmap and an opportunity for public comment on a draft permitting roadmap.
(d) The findings resulting from activities undertaken pursuant to this section shall be included in the chapter of the strategic plan relating to permitting as specified in paragraph (5) of subdivision (c) of Section
25993.1.
25993.6.
(a) The commission, in coordination with the State Lands Commission, the Department of Conservation, and the Governor’s Office of Business and Economic Development, shall assess the level at which geothermal rentals and royalties would best support California’s long-term renewable energy and greenhouse gas emissions reduction goals, including the goals established pursuant to Section 25993.2, while maintaining competitiveness with rentals and rates on federal lands and in other states.(b) Notwithstanding any other law, including, but not limited to, Sections 6910 and 6913, the State Lands Commission may reduce the geothermal rentals and royalties to reflect the findings of the assessment.
(c) The findings resulting from activities undertaken pursuant to this section shall be included in the chapter of the strategic plan related to rentals and royalties as specified in paragraph (6) of subdivision (c) of Section 25993.1.
