Oversight Field Hearing on "“Letting Off Steam: Unleashing Geothermal Energy Development on Federal Land”
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House Natural Resources Subcommittee on Energy and Mineral Resources U.S. House of Representatives
Follow its sittingsSpeaker 1
This package includes mandates for annual geothermal lease sales, rather, which will contribute 23,000,000 in revenue for the federal government and increase certainty for geothermal energy producers. While these changes are a vital step in the right direction, there's much more work to be done to allow geothermal power to scale up and reach its full potential. The Bureau of Land Management, or BLM, oversees geothermal development on federal lands. In fact, geothermal energy was the first type of renewable energy that the BLM approved for production on federal lands, dating back to 1978. However, as we've seen from other forms of energy operating on public lands, the permitting process for geothermal is mirrored by duplicative requirements and lengthy regulatory delays.
Federal geothermal projects must complete up to six stages of the National Environmental Policy Act or NEPA review throughout the development process. This can take up to 10 years and does not include endless cycles of frivolous litigation. We can and must do better. To address these barriers, Republican members of the House Natural Resources Committee have championed legislation that limits NEPA reviews for low impact geothermal activities in previously studied areas, forces the BLM to process geothermal permits in a timely manner, and ensures that the geothermal wells on nonfederal lands are not subject to delays in our broken federal regulatory process. If enacted, these provisions would provide geothermal developers the greater certainty needed to spur investment in research, development, exploration, and production.
While these pieces of legislation are a great start, I look forward to hearing from our witnesses to identify further reforms and ideas to responsibly expedite the geothermal permitting process. As we know, America has a wealth of resources right here at home that can satisfy our growing energy needs and produce reliable base load power. We must work together to responsibly develop these resources to put America back on a path of strength. I again wanna thank the witnesses for joining us today, and I look forward to hearing your testimony. I now want to recognize Representative Malloy for her opening statement.
Speaker 4
Thank you, Mr. Chairman. Welcome to Utah. Welcome to the 2nd District. I wanna thank everyone here who's participating and especially SUU for hosting. It's good to be back here.
For far too long, the promise of geothermal energy has gone underappreciated and underutilized in our national energy conversation. Despite its incredible potential, geothermal's faced regulatory delays, permitting hurdles, and a lack of investment that doesn't match the scale of the opportunity. Let me be clear. Geothermal is reliable and affordable. Unlike intermittent sources, geothermal delivers steady twenty-four-seven baseload power.
It doesn't depend on weather or foreign supply chains. It's a homegrown resource sitting right under our feet. At a time when our electric grid is under stress, and global energy markets are incredibly unstable, we need dependable domestic energy sources. Geothermal offers exactly that resilient American energy that we can count on day and night. Utah's leading the way in showing what's possible.
Earlier today, we had the chance to look at the groundbreaking work being done by Furvo Energy in Beaver County and their pioneering enhanced geothermal systems, EGS, here in Utah's 2nd district. These innovations are putting our state on the map as a model for innovative and dispatchable energy solutions. EGS represents a game-changing opportunity. It can unlock geothermal energy in places where conventional geothermal just hasn't been feasible, vastly expanding the resource base. With the right regulatory framework, we can make EGS a major part of our national energy strategy.
Geothermal also means good jobs here in Utah, especially in rural communities like those in the West Desert. From drilling crews to high-tech engineers, these are careers that can support families and strengthen local economies. That's why there's growing bipartisan support for removing barriers and letting geothermal compete on a level playing field with other energy sources. Despite this progress, geothermal still faces significant challenges. Complex and outdated permitting processes slow down projects and create uncertainty for developers.
Even when the geology is ideal, it can take years to get a green light to drill. In states like Utah, where so much promising geothermal potential lies beneath federally managed lands, the permitting backlog is especially problematic. Developers are forced to navigate the maze of duplicative reviews, unclear timelines, and inconsistent agency coordination. This bureaucratic tangle discourages investment and leaves too many high-potential projects stuck in limbo. That's why I introduced the GEO Act to modernize geothermal permitting by ensuring federal agencies act promptly, even when projects face delays from ongoing court proceedings.
And also, the streamlining of thermal energy through advanced mechanics or STEAM act to ensure that geothermal development isn't hindered by unnecessary regulatory delays. It gives geothermal projects the same flexibility oil and gas has had for almost 2 decades. Today's hearing is an opportunity to identify real, actionable steps Congress can take to unleash geothermal development, from permitting reform to interagency coordination. We need a system that works for innovators, not against them. And we need to be able to produce power here in this country and here in this state, and I'm excited to see us having a hearing about how to do that better.
Thank you for being here, and I yield back.
Speaker 1
I thank the general lady for her statement. We will now move to introduce our witnesses. Let me remind the witnesses that under committee rules, they must limit their oral statements to five minutes, but their entire statement will appear in the hearing record. We use timing lights. When you begin, the light will turn green.
When you have one minute remaining, the light will turn yellow. And at the end of your testimony, the five minutes, the light will turn red. And I will ask you to please complete your statement. I will also allow all witnesses to attest correction, to testify before member questioning. Our first witness, this afternoon, is mister Tim Latimer, and he is the chief executive officer at Fervo Energy, and he is stationed in Houston, Texas.
Mister Latimer, you are now recognized for 5 minutes.
Speaker 5
Chairman Stopper, representative Malloy, representative Begich, and members of the committee, thank you for the opportunity to appear before you. I'm Tim Latimer, the co-founder and CEO of Furvo Energy. And it is an honor to be with you here today, in Cedar City and at the SUU campus again, to discuss the progress the Furvo Energy has made, specifically at Project Cape Station, which is located just an hour north of here, which we got to visit today. Cape Station is the world's largest next-generation geothermal facility. It's the result of over a decade of collaboration between Furvo, the people of Utah, the federal government, this committee, and a broad coalition of investors, researchers, and commercial partners.
But more importantly, Cape Station represents the start of something bigger, a new era of American energy built with American innovation, American technology, and American workers. When we founded Furvo eight years ago, we asked a simple question. If America could unlock the shale revolution through breakthrough technologies in oil and gas, why couldn't we do the same for geothermal? The answer, it turns out, is that we can, and now we have. By adapting technologies such as directional drilling, fiber optic sensing, and hydraulic fracturing techniques from the oil and gas sector, we've unlocked geothermal energy in places where it was previously impossible.
In 2023, we demonstrated this with Project Red in Nevada, a commercial pilot that validated enhanced geothermal systems as a true technological breakthrough and began generating electricity for the first time in October. It set new records for an individual enhanced geothermal well's flow and power output, and it laid the foundation for what we're now building at the Cape Stanfield. Cape Station will provide 500 megawatts of firm, reliable, carbon-free, round-the-clock power, enough to serve hundreds of thousands of homes. And construction is well underway. We've already drilled more than half the wells needed for phase one and partnered with Mitsubishi Heavy Industries to start construction of three on-site power plants.
This isn't a concept or a pilot. Cape Station is a full-scale energy project in motion. What makes Cape special isn't just the technology. It's the community. We're not just developing energy here.
We're building a future with and for Southwestern Utah. We're creating good-paying jobs that don't disappear when construction ends, jobs that last for decades, and jobs that people can build a life around. Families in Beaver County and Millard County will see real, lasting benefits because of this project. President Trump has spoken about the need for energy projects that don't just power homes, but power prosperity, support American workers, and strengthen the fabric of local communities. Cape Station is exactly that.
It's not just an energy solution. It's a commitment to this place and to the people who make it strong. Of course, innovation alone is not enough. To unlock geothermal's full potential, we need smart federal policy. Today, 90% of geothermal resources lie beneath federally managed land, but permitting can take up to a decade, much longer than equivalent wind, solar, oil, or gas projects.
That needs to change. And bipartisan bills like Congressman Fulcher's Clean Act and Senator Curtis' Geothermal Energy Opportunity Act are strong steps in the right direction. We also need federal investment in geothermal R&D and demonstration. The shale revolution was made possible through decades of public-private partnership. Let's apply that same model to next-generation geothermal, especially tackling drilling risk, which remains a key barrier to national deployment.
We're encouraged by the initial 2026 budget request focused on firm baseload power, and we look forward to working with you to ensure geothermal is part of the strategy. In 2019, the Department of Energy's GeoVision report projected geothermal could grow 15-fold by 2050. Thanks to recent advances, even those numbers now appear conservative. Studies now estimate we can unlock over 230 gigawatts of geothermal power in the United States alone. That's more than enough to power half the country.
At Cape Station, we're taking the first steps to make those projections a reality. Thank you for being here. We're proud to show you what we've built and excited to work with you to build America's geothermal future. I look forward to your questions.
Speaker 1
Thank you very much for your testimony. Our next witness is Mister Jake Garfield, and he is the deputy director of the Utah Office of Energy Development. And he is stationed in Salt Lake City, Utah. You're up for five minutes.
Speaker 6
Representative Stauber, representative Malloy, and representative Begich, thank you so much for the chance to be here today. My name is Jake Garfield. I'm the deputy director of the Utah Office of Energy Development. We're a state agency whose mission is to bring new energy sources to Utah and make sure that Utah's energy remains reliable and affordable. We are so excited about the potential of geothermal energy in Utah and so grateful for the investments from the private sectors such as from companies such as Furvo and Ormat, and we're so grateful for the investments being made by the Department of Energy and the University of Utah and other parties in the Forge project.
In Utah, 42% of our land is managed by the BLM. And in the West Desert, most of our geothermal resources are located. That percentage is even higher. That presents both opportunities and challenges, and we're grateful to the administration of the congress for helping us work through those challenges. We're also grateful for the BLM personnel at the state office, the local field offices who, I believe, are doing their best to work through some of those challenges and help move geothermal projects forward.
Today, I'd like to make some four suggestions on how the BLM could or how we could make changes both at the policy level and at the legislative level to help move make progress on geothermal issues at the Bureau of Land Management.
Speaker 6
The BLM really should do more, put low more land into their annual geothermal lease sales. In the last five years, the Utah BLM has put up a little over 160,000 acres for geothermal lease sale in Utah. In that same time period, the Nevada BLM put over 700,000 acres up for lease sale, over 4.4 times the amount of land that went up for lease sale in Utah. The last geothermal lease sale that the U Utah BLM did was fantastic. It was very successful, but it was significantly larger than the past four years of lease sales.
This discrepancy between Utah and Nevada is even more stark when you consider that the Nevada BLM hasn't even held their 2025 lease sale yet. If it can be done in Nevada, it certainly can be done here. The demand for parcels of land to potentially develop geothermal energy far exceeds the supply currently being offered by the BLM, and that's a change we would really like to see. Secondly, we'd like the BLM to consider doing broad scale programmatic planning for geothermal development in the West. They did this type of programmatic planning in 2008, and they looked at basically just where b l where geothermal can happen and where it could happen if all other criteria are met.
But an update to this 2008 plan could use the best available scientific data. It could use the best research to figure out where geothermal energy really is feasible, and where it should happen, where it should be prioritized potentially over other land uses. Just last year, the Biden administration did a similar planning effort for solar power. And if it can be done for solar, it certainly should be done for geothermal energy, particularly since geothermal energy has far fewer impacts on the landscape and, unlike solar, is a reliable baseload dispatchable source of energy. Third, we will need to see a lot of progress with permitting of transmission.
Transmission is uniquely challenging for geothermal energy, because unlike oil or coal, you cannot transport the source of the fuel to your generation site. We need transmission lines to go to the source of the energy itself. And right now, we're permitting from beyond and from other agencies to get transmission done simply takes far too long. We're seeing the initial construction of a long transmission line from renewable energy sites in Wyoming down to Southern Nevada. That's the TransWest Express line.
So far, it's taken 16 years to permit, and construction still won't be done for another 5 years. If we see delays like that with transmission, we'll never see the full build-out of Utah's geothermal potential. And lastly, as we've mentioned before, we need to see progress with NEPA permitting. We need the timeline shortened for geothermal itself. As representative Lloyd mentioned in her opening remarks, there were carve outs for oil and gas development in the Energy Act of 2005 that were not extended to geothermal development.
We are so optimistic about the bills that would extend those type of categorical exclusions to geothermal development. In conclusion, thank you again for coming today. We're so grateful for the provisions in the reconciliation package and represent the Fuller's Clean Act and the GEO Act and other acts of congress that'll help us make so much progress with developing our geothermal resources. Thank you.
Speaker 1
Thank you very much for your testimony. Our next witness is doctor Joseph Moore, and he is a research professor at the University of Utah's Energy and GeoScience Institute, and he is stationed in Salt Lake City, Utah. Doctor Moore, you are now recognized for 5 minutes.
Speaker 8
Thank you. Good afternoon, Chairman Staubert and distinguished members of the subcommittee. My name is Joseph Moore, and I am a research professor at the University of Utah and a principal investigator of the Utah Frontier Observatory for Research in Geothermal Energy, or Forge. I'm honored to appear before you today to discuss the Utah Forge project, an innovative geothermal energy research project funded by the Department of Energy. I am providing testimony today as an individual and not on behalf of the University of Utah.
In the 1970s, attempts to create geothermal reservoirs where none exist naturally were initiated by the Los Alamos National Laboratory. Numerous experiments followed worldwide, but none were capable of producing more than a few megawatts of electric. In 2018, the DOE awarded the University of Utah a grant to build and operate a field-scale underground laboratory where tools and techniques for the creation of enhanced geothermal systems could be tested. In addition to operating the field laboratory, Utah Forge manages 28 external R&D contracts with private companies, national laboratories, and universities. Approximately $100,000,000 of the nearly $293,000,000 received from the DOE has been used to fund these R&D projects.
Several have led to new tools. Utah Forge is the only field-scale laboratory in the world dedicated to EGS research. In the remaining time, I would like to highlight three of the key results that have been achieved. Reducing well costs was an early priority. This ultimately comes down to minimizing the number of times that the drill string must be removed from the drill hole, and the bits replaced.
Working with private industry, new bit designs were developed that increased the rate of penetration by 50%, leading to significant reductions in drilling costs. Second, induced seismicity is a natural consequence of reservoir creation, and even small-magnitude events can lead to public concern, property damage, and project shutdowns. Our efforts are focusing on developing new monitoring tools and technologies. Information on seismic activity can be monitored by anyone in real time through our seismic data webpage. Computers placed in the local libraries allow easy access to this webpage.
The successful stimulation of slanted and cased wells proved to be an important step in reservoir creation. In recent tests, 90% of the water injected was recovered at a temperature of 380 degrees Fahrenheit. The results of the test demonstrate low water loss and high temperatures are achievable. Prior to Utah Forge, the growth of the geothermal industry over the last 2 decades was slow. Many new companies are now investing in EGS as a result of the technological advances demonstrated at Utah FORGE.
Fervo located its project immediately adjacent to Utah Forge, and several other companies have leased land in the vicinity. The data generated at Utah Forge can be downloaded from the geothermal data repository, free of charge. Utah Forge is a unique, publicly owned and operated laboratory. It is a tense, it is an essential test site for EGS technology advancement and a stepping stone to hotter environments, including super hot resources. Our current four-year contract, which began in October 24, will end in '28.
There is still significant work to be done. Unless DOE provides additional funding, we may have to plug and abandon the wells and bring the surface back to grade. We urge the committee members to continue their support of the Utah Forge project and EGS development in the United States. Thank you for the opportunity to testify on the Utah Forge project. I am happy to answer any questions you may have.
Speaker 1
Thank you, Doctor Moore. Our final witness is mister Paul Thompson, and he is the vice president of business development at Ormat Technologies Incorporated, and he is stationed in Reno, Nevada. Mister Thompson, you are now recognized for 5 minutes.
Speaker 3
Thank you very much, Chairman Stauber, Representative Malloy, and Representative Begich, and all the members of the subcommittee. I can't really contain how excited I am to be here. I first testified in front of Congress on geothermal 17 years ago. I think Tim and I did this about 7 years ago. And today, all the things that we were really pushing for then are coming to fruition.
By way of introduction, my name is Paul Thompson. I am the vice president of business development for Ormat Technologies. We are a global leader in geothermal power and recovered energy development, and we operate 22 power plants on federal lands in the Western United States. We have two projects right here in Utah, one called Cove Fort and the other called Blundell. The five items that we really have been pushing on forever are setting timelines for permits, royalty fixes, the ability to do concurrent permitting, annual lease sales, and ESA reforms.
And I'm happy to say we're making incredible progress on all of those. Ormat supports the geothermal permitting reforms initiated by this committee, including HR 301. Thanks to Representative Malloy. These reforms aim to streamline the permitting process, allowing for quicker deployment of geothermal energy on federal lands. The GEO Act, for instance, mandates a 60-day deadline for the Department of Interior to process geothermal drilling permits.
We can tell you lots of stories about getting our NEPA approval and then waiting for geothermal drilling permits for not one year, not two years, but even longer. So this legislation is just critical to that. The GEO Act is also critical at setting deadlines for processing these permits, and the legislation has already led to the issuance of long-delayed permits. We have a project called Baltazar, for example, that received its NEPA approval three and a half years ago, and couldn't get those geothermal drilling permits. With this committee's work and the new administration, those permits were issued, thanks to the diligent work of director John Rabie and Craig Wisher from the Department of the Interior.
Let's move on to royalties on leases for multiple plants. In the 2005 Energy Policy Act, there was a royalty structure that said geothermal power plants should pay one royalty rate for the first 10 years. And once the plant is paid off, that royalty rate should increase. We are the first company to take a project past year ten, and kind.
Speaker 3
Unexpected consequence was that nearby facilities using the same geothermal resource were also moved into that higher royalty rate. So the committee looking at fixing that will drive much more geothermal development and wiser development, because you won't be looking to try to disturb more public lands by separating power plants just to receive better tax benefits moving forward. Concurrent consideration of multiple permits. You've heard the stories today. Geothermal has to apply for an exploration permit.
That used to take 2 to 4 years. And then if we found the geothermal resource, we had to permit a utilization plan or a power plant, that took another two to four years. We have many projects that exceed ten years in the permitting regime. So this committee's work and the administration's now to allow for concurrent permitting is huge, and being able to expedite permits moving forward can drastically reduce the time of 4 to 8 years of permitting development down to something to meet our energy needs as representative Malloy discussed. We last week submitted 10 geothermal projects representing hundreds of megawatts for the accelerated permitting process under NEPA.
We heard about annual lease sales. We've been pushing on that. We heard Mister Garfield talk about it. We couldn't be happier to see more and more states putting geothermal up for leasing. It's very hard to develop it if you can't get access to the federal lands.
And I'm happy to report that states like Nevada, Utah, Idaho, and Oregon are all planning to conduct lease sales this year. BLM, for example, is gonna have possibly two lease sales this year, so we're making huge progress in that area. Lastly, I wanna talk about the US Fish and Wildlife Service. US Fish and Wildlife Service has proposed many ESA listings that could impact geothermal development. They're looking at species like the Dixie Valley toad, the bleached sandhill skipper, the Fish Lake Tuohy chub, the greater sage grouse, the monarch butterfly.
The list goes on. And Fish and Wildlife Service really fought with the Department of the Interior for the last four years and really stopped these projects from moving forward. We have examples of BLM not wanting to issue those permits because they were under threat of being sued by the Fish and Wildlife Service. That's not really how the process is meant to work. We shouldn't have regulatory capture due to the threat of litigation.
So we urge the committee to address the interagency conflicts that hinder geothermal energy exploration. Ormat is dedicated to advancing geothermal energy on federal lands. It supports this committee's, the president's, and the secretary's energy production goals for fostering job creation and economic development. We appreciate your support and look forward to collaborating to unlock geothermal energy's full potential in the United States. Thank you.
Speaker 1
Thank you very much. The chair will now recognize members for five minutes of questions, and I recognize myself for five minutes. In 2019, under president Trump's leadership, the Department of Energy released its report, GeoVision, harnessing the heat beneath our feet, which estimated geothermal could provide over 120 gigawatts of electricity by 2050. For context, the entire domestic grid currently produces 1,250 gigawatts today, for the EIA. The Department of Energy estimate predated many technological advances that have been made in just the past five years, that has vastly grown geothermal's potential scale and has made it viable across multiple geographies.
Mister Latimer, could you please describe how making it easier to permit geothermal energy development on federal lands would increase energy dominance?
Speaker 5
Thank you so much for the question, chairman. And indeed, it's been an exciting time in geothermal. I'd say not just Furvo, but also the pioneering work you heard from doctor Moore at the Utah Forge site means that almost as soon as that document was printed, and it was a great effort to coordinate all of the information about geothermal innovation, it was out of date. And we have pushed forward numerous technology innovations that allow it to make it easier for us to find geothermal. We've between our pilot project and today, as I mentioned to you earlier today, we've reduced drilling cost by over 70%.
And that takes geothermal from a niche resource that can't really have much impact on the grid to one that we can do in many, many more locations in a much greater scale. And so we're quite excited. You know, it's difficult for the data to keep up with how fast the technology innovations are happening. So I think the potential is even greater for that. But, of course, as you mentioned, it also requires better permitting because what we see is an urgent need for there to be reliable, clean, firm power on the grid.
And if you cheer about the timelines, for example, that mister Thompson talked about earlier, if we wanna have cleaner energy on the grid and be based around the clock, firm power, but it takes us ten years to start construction, we're not gonna be in a position where we can have the positive impact that we want to. So oftentimes, our projects, we have the technology ready to go. We have the supply chain ready to go, and we are in a position where we're waiting for these multiple redundant permitting applications. I think there's a way to do these projects with a very high quality, without sacrificing any of the environmental attributes. But just doing some of the reforms that are in the bills that you have proposed allows us to really just, you know, remove some of the redundancy in the system that lets us grow much faster.
And I think the real question is, is that a goal we want to set for mid-century or beyond? Or do we wanna have this ramp up and reliable firm power from geothermal happen much more quickly? And if that's the case, if we wanna have more impact sooner, there has to be a way to streamline the permitting reforms with reforms like what this committee has talked about.
Speaker 1
So would you say, I think I know the answer that Fervo or other developers are sitting on sidelines in terms of developing additional projects because of these permitting challenges?
Speaker 5
I think that's right. And I think one of the things that, to say is, you know, the numbers we've discussed today where sometimes it can take over a decade to permit these projects, those are only the projects that actually move forward to get far enough to even enter the permitting queue. And I can tell you we've had numerous projects where we've had community support. We've had high-quality geology. We've looked at and had some sort of transmission solution, but we haven't even prioritized investing in the project yet because we didn't see a viable pathway to getting permits.
And much like Paul talked about with your MAT experience, we have numerous examples where our permits have sat for years without even getting an answer or a review. And I think, really having a renaissance in energy the way we need to, we have to address those fundamental issues.
Speaker 1
It's simply not acceptable for permits to sit for years on end when we have the technology and expertise and the investment wanting to do so. You know, geothermal faces power faces a unique challenge in the fact that reviews under NEPA have to be completed in sequence or one after the other rather than simultaneously. This includes land use planning, preleasing, exploration, drilling, wellfield development, power plant construction, and transmission, all of which have to be done separately. This means drastically increased project timelines and costs, all of which hit American consumers, both in terms of the cost of energy and the reliability of our electric grid. This completely is the opposite of what we should be doing, getting more reliable, abundant, and affordable online energy, that is demanded and continues to skyrocket.
It the energy demand is only gonna go up, as we move into the AI race, etcetera. It is energy that is going to bring that dominance to this great nation. So, mister Thompson, you know what? I'm gonna ask, I'm gonna wait for probably my second round to ask you that question. So, now I will go to Representative Malloy for five minutes of her questioning.
Speaker 4
Thank you. I'm gonna start with a question to Mister Latimer and Mister Moore, both because you both touched on this end today. When we were on the field trip part of this, we talked about it a little bit. But will both of you speak to the importance of having government research and combining it with private investment like we're doing in Beaver County, and why that's so important to developing resources?
Speaker 8
Thank you for the question. When we started Forge, projects had been done around the world, and none had been able to produce more than two or three or four megawatts of electric. And this had been recognized. Keep on. We didn't have the tools.
Didn't we know how to do the exploration? We didn't know how to do the drilling. And, as Tim said, a lot of this came from the oil and gas industry. In fact, the objective of Forge was to take oil and gas tools and upgrade them, make them more useful. And we learned very quickly.
Many of the tools didn't work at the temperatures of Forge were up to 500 degrees Fahrenheit, so we're quite hot. There was no infrastructure to build these tools. There was no reason the oil and gas industry, for example, would build tools suitable for high temperatures. We didn't have the drilling techniques, for example the bits that we needed. And Fortes now drilled 7 or 8 wells.
Deepest is 9,500 feet. It is the only commercial-scale R and D facility in the world. And that's really critical, because we are testing new tools. I mentioned we have 28 R and D projects that Forge funds. I don't think we would have seen the increase in enthusiasm really from the geothermal industry, and I must admit, from the oil and gas industry as well to get back into geothermal.
And I think without Furbo's work, that wouldn't have happened. But, fortunately, they're using some of the tools that are being developed.
Speaker 5
Thank you. Yeah. I would echo that and say that, you know, just to make this concrete, the value of some of these public private partnerships is oftentimes it's difficult to attract private sector investment to do truly innovative things. So when Furvo started in 2018, we raised the seed round to get started. We raised about $500,000, and we had to scrap and fight to look over every stone to find that funding.
And more often than not, the answer we got was, well, how do you know you have something there when you drill geothermal? This is uncertain. You can't see what's down there. And we did a lot of feasibility testing with that funding. But we realized to do the next step, we needed to raise $10,000,000, not $500,000. And we faced that same skepticism from the investors.
What if the resource isn't there? What if you can't drill it? Well, around that time we were raising that next round of funding so we could progress our technology forward, the Utah Forge team published their results on drilling the wells there. And we were able to point and say, look, here are some of the drilling techniques that we're proposing to use that have been derisked. And on top of that, we actually are gonna site our project right next to auditors, so we can leverage the available data that Joe talked about earlier on geothermal data repository.
And I don't think we would have been successful in raising the private sector funds needed for a new venture. Do we not have this ability to leverage resources done by the national labs and the universities in support of the Department of Energy? And I think that's where these partnerships are critical, in times where you could have something with phenomenal impact on society, but where the private sector is insufficient to fund it, and you can partner together in a research collaboration that really moves the needle. And what we're doing in Beaver County through the partnership with Utah Forge is, I think, a tremendous example of this working well.
Speaker 4
Thank you. Mister Thompson, I have a short time left, but I'm gonna give you a really short question. You said that you testified about this seventeen years ago, and I assume that you're excited to see some of these things starting to move. But you also have a really bipartisan background. And I think when we talk about permitting reform, sometimes politics get involved, there's some skepticism that if we streamline permitting, we can do things in a clean, safe, environmental way.
How confident are you that we can do geothermal permitting faster and protect the environment?
Speaker 3
I'm very confident. I think we have shown we can do the baseline studies. We can comply with NEPA. You know, one of the amazing things about geothermal is it has a footprint disturbance 22 times smaller than solar, with integrated storage. These typical power plants, as you probably saw today, take up a 15- to 20-acre pad.
The geothermal reservoir is preserved into, you know, perpetuity if managed correctly. In the, you know, Ormat has been in operation since 1985. We've never had a take permit associated with one of our projects. We can move the geothermal power plants. We can move the wells and so forth to make them as benign as possible to the surrounding environment.
Couple that with no emissions and baseload power, and the environmental footprint of these facilities is astonishing. And the fact that it takes almost as long to permit, you know, a mining site is an example of just waiting too long. And the what your bill does is say once NEPA is complete, it doesn't short shrift the NEPA process at all. It just says once it's done, the administrators in these offices need to issue these permits in a timely manner.
Speaker 4
Thank you. My time's expired. I'll have follow-up questions during the next round.
Speaker 1
Before I go to representative Begich from the great state of Alaska, because you brought up mining, I will tell you, it takes 29 years on average to open up a mine in the United States of America. Twenty-nine years. And now we're gonna go to Representative Begich for five minutes from the great state of Alaska.
Speaker 7
Thank you, Mr. Chairman. My first question is to mister Latimer. Mister Latimer, we know that geothermal is kinda lumped into this category that we call renewable resources. We got solar. We got wind.
We got hydro. We got geothermal. Now with solar and wind, what we've seen in a couple of significant examples, we saw this in Texas, we saw this recently in Spain, we've seen it in Germany. They may be renewable resources, but they're not necessarily reliable resources. Hydro and geothermal, of course, are sustainable resources.
They're baseload. They're reliable. Can you speak to the importance of reliable baseload power versus what some might call fair-weather power?
Speaker 5
Yeah. And I think I very much appreciated that the chairman's opening comments about there being such an acute need for energy that we really need to be looking at all these resources. And I think there's valuable parts of solar and wind that can add to the grid, but it's also important to distinguish where geothermal offers value where solar and wind may not. And it is something that, you know, even if the weather changes, the earth is always hot. You know?
And it has been for four billion years, and it will be, it will continue to be for a few billion more. And so as a result, we have a load profile that's far more reliable. And actually, what we're seeing in our offtake contracts with our customers is reliability is sort of the key focus of offtakers today. And so actually, we struggled a little bit. We're in a very different power market when we started the business over seven years ago, to really get people to really hold on to the value of what this reliability means.
And there were two big events that happened in The United States that really made a difference. One was in August 2020, the state of California experienced rolling blackouts for the first time in over two decades as a result of a very hot summer evening that really stressed the electric grid. And then in Texas, my home state, many of us, myself included, lost power for over five days in winter storm Yuri just a few months later. And all of a sudden, you saw reliability go from an afterthought in planning processes for power to first and foremost. And we saw a number of state regulatory changes that ascribe value to something that provides power around the clock.
And geothermal is unique in its ability to do that. It works in warm weather. It works in cold weather. You know, everybody knows Iceland is a geothermal country. So if you wanna know if it works in cold weather, there is your answer.
And it also provides that rotating inertia that's very valuable to the grid. And what we're seeing is more and more our customers are looking at how do they meet their goals when it comes to reliability, cost, and sustainability and emissions. And more and more, they're coming to the answer that geothermal plays a huge role in that mix because we just offer a different value that other energy resources haven't. And that's been a huge part of explaining this renaissance in geothermal.
Speaker 7
What, and it's just a follow-up question. You know, we often see that emerging power technologies require heavy subsidies in order to exist and be somewhat competitive to traditional energy. Long term, thinking long term, do you think that geothermal is gonna be cost competitive to other forms of more traditional energy, and kind of maybe some commentary around that?
Speaker 5
Absolutely. You know, what the technology innovations we're talking about that we've pioneered and that the University of Utah has pioneered and that the DOE supported are very new. And so there's still a lot of learning that is happening. And so even between our first and second project, here in Beaver County, Utah, we're reducing our cost by over 30%. And so we're at a very steep part of the learning curve, actually, where the support from the DOE, the investment tax credits that are on the books, make a big difference for getting our industry off the ground.
But our mission at Furvo, and I don't think we would be doing this if we didn't think this was the case, is that we're on a cost trajectory where within a few years, it's gonna be the cheapest form of power, period. And that's with or without subsidies. That's whether or not you manufacture it clean, dirty, reliable, you name it. We just wanna have the cheapest form of electricity, period. And the fact that it is clean and it does have these reliability attributes is very, very positive.
But when you look at the technology cost structure that we're the trajectory we are on, we have every confidence that this is gonna be the lowest cost way to get electricity to people, within the next five to ten years, and that's what we're after.
Speaker 7
That's very exciting. I appreciate that commentary, and I will now yield to the chair. I'll have follow-up questions in round two.
Speaker 1
Thank you very much. So at the chair's request, I am going to go a second round of questioning. I think that we traveled here. We have the audience members, are still some more questions that I have, and I'm gonna recognize myself for the next, second round of questionings. Mister Thompson, if congress were to change these requirements and allow different steps of the NEPA process to run concurrently, what kind of impact would that have on our ability to get geothermal prod projects built and brought online in a timely fashion?
Speaker 3
Chairman, thank you for the question. Think we touched on it a little bit with the DOE Geovision report, that if we can reduce the permitting timelines, we can unleash gigawatts of generation for geothermal deployment. I'll just elaborate a little bit. You know, today, we've talked about technologies that capture low-temperature heat. There is a huge amount of resource out there for geothermal development today, with, you know, older technologies, traditional technologies, new technologies, advancing technologies to be developed.
And the single biggest hurdle has been permitting, and I've been harping on that for over a decade. And, again, I think, you know, to touch on the point that we do comprehensive baseline studies. We do comprehensive numerical water modeling. And what sets geothermal apart, which I think is important to say, is we have to have a symbiotic relationship with the resource. We don't go in and try to extract something and leave.
We have to, if we wanna be successful, operate a power plant for about two decades, 20 years. The amortization rate is about 10 years. So we become incredibly good stewards of the land and the reservoir, because we have the same goal in mind. To maximize the amount of power we can produce, the revenue that we generate, we have to protect those precious geothermal reservoirs, and we invest an incredible amount of time and money to do just that.
Speaker 1
Thank you. Mister Garfield, how long does it take for the state of Utah to permit a geothermal project on state lands?
Speaker 6
I've been discussing this question with our state land agency. I was asking that, how long does it take? And they said they really can't put a number on it because geothermal energy is so new, especially on state lands. But they did say that and the projects they do, we do have a couple of projects, but they've taken unique circumstances each time, but they've said they could get things permitted very quickly, much quicker than the BLM. Fundamentally, because we don't have a NEPA type statute in Utah.
They are cognizant of what they're doing. They, when they get a proposal for a development, they make sure that the land will not be degraded, that there's measures for mitigation, for reclamation of the land later, but they are not required under statute to do the type of duplicative and onerous analysis that's required under NEPA. And that fundamentally is why both our state land, our state trust lands agency, and other state agencies are able to do this type of permitting much quicker than at the federal level.
Speaker 1
So it's safe to say that Utah understands that the federal government is simply not getting it yet, and that's why these hearings are so important. So Mister Thompson brought up something that he talked about permitting. We've all talked about permitting here. You know, if we don't accelerate it, we're gonna be left behind. I'm going to give you an example.
If we don't get a bridge permitted in Northern Minnesota and finished by early November, December if there's a permitting problem, that waits for five months till the road restrictions come off in the spring, and that time is money. And you're looking at geothermal. Time is money. We you you're looking for that investment to come on board. I can tell you, mister Latimer, I was extremely impressed with Furvo today.
And I will tell the audience members, as the chair of energy and minerals resources, your Utah reps are really pushing geothermal, almost not only my committee, but the full committee pushing geothermal. To come out here and actually see what you're doing, this is that next gen opportunity. And I commend you for all the work you did. Mister Moore, you've been doing this for a lot of years, you're studying. And it's you're seeing that the work that you put in the technology.
And I hope, I hope that, you know that we appreciate it. The next generation appreciates it. And we certainly appreciate the, you know, the state of Utah leading that. And just by meeting a few of you earlier today, the enthusiasm, the get it done attitude. Mister Thompson, you brought up something very important.
In Minnesota, we mine. Right? I'm a pro-mining environmentalist. Nobody gets to own that term because I live there. I work there.
I've raised my family there. I'm gonna pass away there in my home state of Minnesota, where we lead in mining with the exception of the great state of Alaska. So I just want to, as I close my comments, I just wanna say, thank you very much. Just an exceptional day at Furvo. And with that being said, representative Malloy, you're up for your second round of questioning.
Speaker 4
Thank you. Mister Garfield, I wanna follow up on the questions that the chairman just asked you. How does the state of Utah's permitting process for geothermal development differ from the state's typical permitting process? Can you speak to that?
Speaker 6
Different from other permitting processes for other developments? Mhmm. The it is so new. I think there's a lot that's still going on here, but I would be happy to ask that question of our permitting agencies and get back to you more information.
Speaker 4
I'll follow-up in writing afterwards while you want so you can talk to your counterparts in the state. But where does the process break down most often for the state in trying to get energy projects permitted? Can you tell me that?
Speaker 4
I'll get you off the hot seat. Mister Thompson, I said I was gonna follow-up with you on your answers. And one of the things I wanna follow-up with you on, because you've been doing this for so long, will you talk about the impact that we all know we need to produce more energy in this country? We know that there's a need for increased energy production. But even looking backward, we've been producing geothermal energy in rural areas.
Can you talk about the impact that has on the economies of rural areas when we have sustainable energy being produced?
Speaker 3
Absolutely. Thank you. Through the chair to representative Malloy, you know, once you have a geothermal project up and running, it requires very few employees to operate it. We don't really have a burden on police stations, fire stations, etc. We've had county commissioners refer to our power plants as ATMs in the desert, in rural Nevada.
But the impact is because when you produce power twenty-four hours a day, seven days a week, fifty-two weeks a year, and sell that electricity under a power purchase agreement, you create a good amount of revenue. And in the state of Nevada, for example, a huge portion of that goes back to the local counties. And so in states that have a lot of federally owned land where they're not always getting the payment in lieu of taxes from the federal government, these projects have an astonishing effect. We're probably the largest employer in many rural counties in Nevada next to mining, which is the biggest employer in Northeastern Nevada. So the impact is just huge.
And I would if I can, I'd go back to one of previous questions about, you know, the impact on the work at Utah and the public private partnership. What's unique about geothermal is that we can't bottle up the electricity and put it on the USB Duracell and ship it to the highest bidder. It's a US domestic product. The price is controlled by the US market. So whether we're in Nevada or Utah, we can only sell the electricity for what the public utility commissions will limit.
So it's, you know, it's got a cap on its energy, on its price point that we can get for it. We can't gouge ratepayers. It also limited us in what we could spend in subsurface research. So the public-private partnership from, like, the University of Utah and the Department of Energy to go after the subsurface work has just been critically important and brings in world-class researchers to work on these projects. The University of Nevada, the University of Utah. Every time we're working on an advanced EGS project, experts fly in from all over the world to help and work in these communities, and it's really astonishing to see the impacts.
Speaker 4
When you're hiring people to run the plants once they're up and running, how often do you hire local talent?
Speaker 3
Almost always. You know? Thank you. Coming from a small town, you know, we have very rural power plant locations, and the best people to work there are the local employees. We can teach them to use a voltmeter and work at the power plant.
We employ tribal members at our projects because they are the best stewards of the land and know what’s going on in that community.
Speaker 4
Thank you. Mister Latimer, just really fast, because I'm almost out of time. When we were out on-site today, you talked about how the research you're doing is going to unlock your ability to produce geothermal energy, hopefully. In a lot of places, we don't think of it as geothermal right now. Will you just, in thirty seconds, say how widespread that could be?
Speaker 5
Yes. It could easily be nationwide, and then the mission is to take that around the world. It's purely a function of cost, and we've dropped costs so quickly. And we're on a fun, we're on a trajectory to drop it even more. It's gonna unlock a huge resource.
We can drill a well now to 15,000 feet deep for what we thought we could drill a well to 5,000 feet deep just a couple of years ago, because of the drilling innovations we've had. And that means that while we're here in Utah because of the great local support and the great policy support, it's also because of the great geology. But what we're learning here allows us to develop the technologies that allow us to take this to other communities all across the country, because we're lowering the drilling cost of development.
Speaker 1
Thank you very much. Representative Begich, your second round of five minutes.
Speaker 7
Thank you, Mr. Chair. First question to Mr. Thompson. Stranded geothermal must be connected to the grid. What level of core grid investment is required nationwide? And you can give me a directional ballpark, to fully utilize our nation's geothermal potential.
Speaker 3
Thank you very much for the question. Through the chair to representative Begich, I was discussing this actually driving in today that I think with all the progress that we're gonna see on permitting, the next, you know, hurdle will be the transmission and interconnection of these facilities. I think a lot of what this committee has discussed in kind of streamlining permitting needs to apply to transmission infrastructure, and we're going to need to build more. However, I also think we need to look at the existing transmission infrastructure. Today, it is a very archaic process.
If you take a transmission position and you have your 30 megawatts, whether you use it or not, or whether it's an intermittent resource or not, you lock up that portion of the transmission. I would be willing to bet today that our entire transmission infrastructure is used about 50% of the time. And I think a real hard look at the open access tariff program at FERC and trying to figure out a very smart way to say, I need to use my existing transmission assets more efficiently would unleash a huge amount of development. You know, these intermittent resources we talked about, we know some of them don't work when the sun goes down, but that transmission that they've procured is locked up. And so it's just amazing to me that load serving entities and utilities aren't driving after this because more energy on that system, more revenue, and wheeling charges and so forth.
And then, simultaneously, we need to be building out more infrastructure. Trying to move power to the places that needed it is going to be the next step of unleashing this geothermal development.
Speaker 7
Thank you. That's an insightful observation. I appreciate that commentary. My next question to mister Latimer. Grid resilience, grid diversity, grid upgrades, and grid expansion require mining, specifically copper.
Do you have concerns about the supply of mineral resources necessary to develop those grid improvements?
Speaker 5
Well, it might be above my pay grade to talk about copper. I think you may be more of the expert on that topic. I think, clearly, without a doubt, the transformation that we're undergoing on the grid right now, the need to meet reliable power and drive emissions lower is gonna require a huge amount of resources. I could speak a little bit more to geothermal than I can to the other parts. Of course, we need the grid to be successful, but I just know geothermal a little bit better.
One of the big advantages of geothermal is we have a very relatively straightforward supply chain, and it's quite domestic already. And we don't often require a lot of the same minerals or mining content that other resources have, and a lot higher portion of it compared to other energy resources are sourced here in The United States. So I think without a doubt, we're gonna need to have all kinds of things, to move forward on transforming the grid, as we continue to improve it. But from where we sit in the geothermal world, we're very fortunate that we have straightforward projects with local and domestic supply chains, without a lot of the same risks and exposures of other energy resources. So that's what the vantage point from geothermal looks like.
Speaker 7
So as long as the grid is there, the geothermal technology in terms of the resource load is relatively low compared to other. That's right. Energy generation sources. Okay. And last question. I've just got a minute thirty left here for Doctor Moore.
Can you walk us through the methodology for exploration, discovery, and proving up of a geothermal resource? Sure.
Speaker 8
Primarily, we're looking for hot rocks that are isotropic at this point. In other words, they have the same properties in all directions. Granite would be the best. So, we use a variety of techniques. We'll use seismic reflection to locate the top of the granite, where we're going to drill into it.
We look for faults and fractures in the rocks. We're actually not trying to produce from them. We drill a test well, and probably the biggest and most important step is to drill a test well that is deep enough. So the first well we drilled was 8,000 feet deep, and that gave us information on temperature, which is absolutely critical. Stress field, we have to know which way the earth's forces are pushing against us so we drill in the proper directions.
Again, rock type. And so those are pretty basic. I would guess typical, like it $410,000,000 to do the basic exploration.
Speaker 7
Thank you. That's a relatively low cost investment relative to other exploratory activities in the energy space. My time has expired, and I appreciate your commentary. Thank you.
Speaker 1
I wanna thank the witnesses for your valuable testimony and to my congressional members for their questioning. Without question, Utah leads in geothermal. And I think for many years, you will. The expertise, the opportunities you have here. The members of the subcommittee may have some additional questions for the witnesses, and we will ask you to respond to these in writing.
Under committee rule three, members of the committee must submit questions to the committee clerk by 5 PM on Thursday, May 15. The hearing record will be held open for 10 business days for these responses. And before I gavel out, I wanna recognize SUU president, president Mindy Benson, in the audience for your hospitality. It's greatly appreciated. What a wonderful university.
Thank you, President Benson. I also wanna thank the audience for your attendance. What an opportunity your great state has. And, of course, representative Malloy who has brought me to your great state twice now, and Utah is something special. It's a privilege serving with you in Congress.
And I'm gonna take I'm just gonna put in a shameless plug. Minnesota is the state of hockey. The Utah Mammoth just signed my nephew Jackson Stauber as a goaltender for another two years. So if there's no further business, the committee stands adjourned. Thank you all.
Be safe.
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