H.R. 5638, known as the Geothermal Royalty Reform Act, has advanced through the House Natural Resources Committee this week. The bill aims to update federal royalty rules related to geothermal energy production in the United States.
According to Congressman Mike Kennedy, “Americans need reliable, affordable energy, and geothermal power is one of the most promising untapped resources we have. Outdated royalty rules have penalized new facilities and stifled the investment needed to unleash this energy source. The Geothermal Royalty Reform Act fixes that, and I am grateful to Chairman Westerman and the Natural Resources Committee for their support in advancing this important legislation.”
Chairman of the House Natural Resources Committee Bruce Westerman added, “The Geothermal Royalty Reform Act provides much needed clarity for geothermal royalty payments. I commend Rep. Kennedy for his efforts in unleashing America’s geothermal resources to provide a greater supply of reliable energy to American families.”
The proposed legislation seeks to ensure that each geothermal facility pays royalties based on its own operational costs rather than being linked to the highest-cost facility on a lease. This change is intended to create a fairer system for both taxpayers and energy producers by ensuring equitable charges across different operations.
Additionally, supporters argue that modernizing these rules will reduce bureaucratic barriers and lower unnecessary costs for developers, which could encourage further investment in geothermal projects across the country. By addressing these issues, proponents believe it will help drive growth within the sector and enhance America’s position in global energy production.
The full text of H.R. 5638 can be accessed online.
