AB527 - California Environmental Quality Act: geothermal exploratory projects: geothermal field development projects: enhanced geothermal system wells.

Enrolled September 12, 2025 Passed IN Senate September 09, 2025 Passed IN Assembly September 10, 2025 Amended IN Senate September 05, 2025 Amended IN Senate July 23, 2025 Amended IN Senate July 07, 2025 Amended IN Senate June 24, 2025 Amended IN Assembly May 05, 2025 Amended IN Assembly April 21, 2025 Amended IN Assembly April 10, 2025 CALIFORNIA LEGISLATURE— 2025–2026 REGULAR SESSION Assembly Bill No. 527 Introduced by Assembly Member Papan (Coauthor: Assembly Member Rogers) February 10, 2025 An act to amend Sections 3731 and 21065.5 of, to add Sections 3738 and 21080.71 to, and to add and repeal Section 21080.67 of, the Public Resources Code, relating to geothermal resources. LEGISLATIVE COUNSEL'S DIGEST AB 527, Papan. California Environmental Quality Act: geothermal exploratory projects: geothermal field development projects: enhanced geothermal system wells. The California Environmental Quality Act (CEQA) requires a lead agency, as defined, to prepare, or cause to be prepared, and certify the completion of an environmental impact report on a project that it proposes to carry out or approve that may have a significant effect on the environment or to adopt a negative declaration if the lead agency finds that the project will not have that effect. CEQA also requires a lead agency to prepare a mitigated negative declaration for a project that may have a significant effect on the environment if revisions in the project would avoid or mitigate that effect and there is no substantial evidence that the project, as revised, would have a significant effect on the environment. Existing law establishes the Geologic Energy Management Division in the Department of Conservation, under the direction of the State Oil and Gas Supervisor, who is required to supervise the drilling, operation, maintenance, and abandonment of wells so as to permit the owners or operators of those wells to use all methods and practices known to the industry for the purpose of increasing the ultimate recovery of geothermal resources, as provided. Existing law requires the division to be the lead agency for all geothermal exploratory projects for purposes of CEQA, as specified, and authorizes the division to delegate its lead agency responsibility for geothermal exploratory projects to a county that has adopted a geothermal element for its general plan. Existing law also requires the county in which a geothermal project is located to assume the responsibilities of a lead agency for a geothermal exploratory project upon the request of an applicant, as specified. Existing law defines “geothermal exploratory project” in part as a project composed of not more than 6 wells and associated drilling and testing equipment whose chief and original purpose is to evaluate the presence and characteristics of geothermal resources. Existing law requires wells included within a geothermal exploratory project to be located at least one-half mile from geothermal development wells that are capable of producing geothermal resources in commercial quantities. Existing law requires the owner or operator of a well to keep, or to cause to be kept, a careful and accurate log, core record, and history of drilling the well and requires the log to show, among other things, the character and depth of the formation passed through or encountered in the drilling of the well. Upon completion or abandonment of a well, or upon the suspension of operations of a well, existing law requires true copies of the log, core record, and history to be filed with the district deputy of an oil and gas district, as specified. This bill would expressly include as part of a geothermal exploratory project, among other things, equipment and activities necessary to establish interconnectivity between wells and reservoirs. The bill would exclude certain wells connecting to geothermal reservoirs from the one-half mile limit described above. The bill would require the log for a well that is part of a geothermal exploratory project that is exempt from CEQA, as described below, to include the chemical and physical characteristics of well stimulation fluids. Upon completion or abandonment of a well, or upon the suspension of operations of a well, that is part of a geothermal exploratory project that is exempt from CEQA, as described below, the bill would require a project developer to disclose the composition of fluids used in all relevant hydraulic fracturing operations with the log for a well and would require the project developer to file a copy of the disclosure with the lead agency. This bill would, until January 1, 2031, exempt from CEQA geothermal exploratory projects that meet specified conditions and for which the county or the Geologic Energy Management Division is the lead agency. The bill would require a project developer to conduct a reconnaissance survey, that includes certain information, and to supply the lead agency with the reconnaissance survey when applying for an exemption from CEQA. The bill would require the lead agency to engage in a scoping consultation with any California Native American tribe that is traditionally and culturally affiliated with the geographic area of the proposed project, as provided. The bill would authorize the lead agency to require the project applicant to file an indemnity bond, as specified, before the lead agency determines that a geothermal exploratory project is exempt from CEQA. The bill would require a geothermal exploratory project that is exempt from CEQA to include full reclamation of the project site, as provided. The bill would require the lead agency, at least 30 days before making a determination to approve a geothermal exploratory project as exempt from CEQA pursuant to this exemption, to post a written notice of the intent to apply the exemption at the project site and to post a written notice of the intent to apply the exemption and the entire project application on its internet website. If the lead agency determines that the project is exempt from CEQA, the bill would require the lead agency to file a notice with the State Clearinghouse in the Office of Land Use and Climate Innovation and with the county clerk of the county in which the project is located, as provided, and to provide a copy of the notice to specified entities. Because the exemption would apply to projects where the county is the lead agency and the county would be required to engage in a scoping consultation and determine if a project qualifies for this exemption, the bill would impose a state-mandated local program. This bill would require a geothermal field development project located on a site where a geothermal exploratory project was deployed pursuant to the above-described CEQA exemption to use a baseline for CEQA review that reflects the site before the geothermal exploratory project occurred. Existing law requires the owner or operator of a well to file a written notice of intention to commence drilling with, and prohibits any drilling until approval is given by, the supervisor or district deputy. This bill would require, on or before January 1, 2029, the Geologic Energy Management Division to promulgate regulations for enhanced geothermal system wells, as provided. Before the promulgation and implementation of those regulations, the bill would require an operator to provide specified information to the supervisor when the operator files the notice of intent to commence drilling for a well in a CEQA-exempt geothermal exploratory project that employs enhanced geothermal system technology. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for a specified reason. Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: YES Bill Text The people of the State of California do enact as follows: SECTION 1. Section 3731 of the Public Resources Code is amended to read: 3731. (a) The log described in Section 3730 shall show the character and depth of the formation passed through or encountered in the drilling of the well, the amount, size and weight of casing used, and particularly the location, depth and temperature of water-bearing strata, together with the temperature, chemical composition, and other chemical and physical characteristics of fluid encountered from time to time, so far as ascertained. (b) For a well that is part of a geothermal exploratory project exempt from the California Environmental Quality Act (Division 13 (commencing with Section 21000)) pursuant to Section 21080.67 employing enhanced geothermal system technology, the log shall include the chemical and physical characteristics of well stimulation fluids, including additives and proppants, as defined in Sections 3150 and 3154, respectively, if any, and the amounts used for well stimulation. SEC. 2. Section 3738 is added to the Public Resources Code, to read: 3738. (a) On or before January 1, 2029, the division shall promulgate regulations for enhanced geothermal system wells, as part of an update to regulations for geothermal wells, that explicitly include and address all of the following: (1) Seismic risks. (2) Well construction, including the required material composition and construction design for the entire range of anticipated subsurface conditions, and the chemical composition and physical properties of the geologic formations and any geologic fluids. (3) Fracture propagation from well stimulation. (4) Geologic and hydrologic isolation of the geothermal fluids and reservoir. (b) It is the intent of the Legislature that the division incorporate the development of regulations pursuant to this section in its existing effort to update geothermal regulations, previously workshopped by the division in 2018 and 2022, that is already underway to support the development of enhanced geothermal systems. (c) Before the promulgation and implementation of enhanced geothermal system well regulations pursuant to subdivision (a), the operator, when filing a written notice of intent to commence drilling pursuant to Section 3724 for a well in a geothermal exploratory project exempt from the California Environmental Quality Act (Division 13 (commencing with Section 21000)) pursuant to Section 21080.67 employing enhanced geothermal system technology, shall provide to the supervisor all of the following information: (1) The type of well and intended use, purpose, and approximate volume rates of injection of any well stimulation fluids. (2) A plan for seismic monitoring and risk-based mitigation consistent with the United States Department of Energy “Protocol for Addressing Induced Seismicity Associated with Enhanced Geothermal Systems,” published in January 2012, that meets or exceeds the monitoring requirements of Section 1785.1 of Title 14 of the California Code of Regulations. (3) Full disclosure of the anticipated composition and disposition of well stimulation fluids, if planned to be used. This disclosure shall, at a minimum, include all of the following: (A) The anticipated date of the well stimulation treatment. (B) A complete list of names, Chemical Abstract Service (CAS) numbers, and the maximum concentration, in percent by mass, of each and every chemical constituent of the well stimulation fluids anticipated to be used. If a CAS number does not exist for a chemical constituent, the owner or operator may provide another unique identifier, if available. (C) The trade name, the supplier, concentration, and a brief description of the intended purpose of each additive, as defined by Section 3150, including any proppants, as defined in Section 3154, contained in the anticipated well stimulation fluid. (D) The location of the portion of the well subject to the well stimulation treatment and the extent of the fracturing or other modification, if any, in the geologic formation surrounding the well induced by the treatment. (4) (A) The information provided pursuant to paragraphs (1) to (3), inclusive, is not confidential information pursuant to Section 3752. (B) The information provided pursuant to paragraphs (1) to (3), inclusive, may be provided to the supervisor with the first application for a written notice of intent to commence drilling pursuant to Section 3724 for a well in a geothermal exploratory project exempt from the California Environmental Quality Act (Division 13 (commencing with Section 21000)) pursuant to Section 21080.67 and may be referenced in subsequent applications for the same project if the same information applies to all wells. (d) (1) This section does not prohibit the supervisor from asking for additional pertinent data in considering the written notice of intent to commence drilling pursuant to subdivision (d) of Section 3724. (2) Before the promulgation of the regulations pursuant to subdivision (a), this section does not prohibit the supervisor from approving wells that use all methods and practices known to the industry for the purpose of increasing the ultimate recovery of geothermal resources that, in each case, the supervisor deems suitable for these purposes. SEC. 3. Section 21065.5 of the Public Resources Code is amended to read: 21065.5. “Geothermal exploratory project” means a project as defined in Section 21065 composed of not more than six wells and associated drilling and testing equipment, including equipment and activities necessary to establish interconnectivity between wells and reservoirs, temporary roads, electric distribution lines, and infrastructure to provide power for drilling and testing equipment, whose chief and original purpose is to evaluate the presence and characteristics of geothermal resources before commencement of a geothermal field development project as defined in Section 65928.5 of the Government Code. Wells included within a geothermal exploratory project, excluding wells connecting to geothermal reservoirs whose permeability or capacity to allow the flow of geothermal fluids, including water, has been increased from its natural or original state through stimulation, horizontal drilling, the use of closed-loop configurations, or other techniques, shall be located at least one-half mile from geothermal development wells that are capable of producing geothermal resources in commercial quantities. SEC. 4. Section 21080.67 is added to the Public Resources Code, to read: 21080.67. (a) This division does not apply to a geothermal exploratory project, as defined in Section 21065.5, for which a county or the Geologic Energy Management Division is the lead agency pursuant to Section 3715.5, including any permit, funding, or other approval by a state or local agency for the geothermal exploratory project as may be required by this division, if the lead agency determines that the geothermal exploratory project mee [Text truncated for display. Full text available on Congress.gov.]