WASHINGTON, D.C. – Congressman Mike Thompson (CA-1) on Thursday led a bipartisan group of representatives in calling on President Obama to protect local clean energy royalties from harmful budget cuts.

The letter urges the president to not repeal the sharing of geothermal royalty payments with counties.

Because of the high burdens that geothermal production places on the counties where it is developed, counties currently share in the revenue of the federal receipts. Revenue sharing has been a target of cuts in the past.

“The geothermal energy produced in California’s counties is good for our environment, reduces our dependence on foreign oil and helps our economy by spurring green job creation,” said Thompson. “Repealing geothermal royalty payments to counties is a short sighted plan that will do nothing to reduce our deficit. Also, it is not fiscally responsible. It will kill jobs, cripple future green job growth and slow our economic recovery – all of which will only make our deficit larger. If a community invests in developing geothermal energy they deserve to get their fair share in returns.”

Last year, Lake County received $800,000 a year in geothermal royalties. The county has received among the highest reimbursement amounts nationwide thanks to The Geysers geothermal steamfield.

Revenue sharing was first started through the bipartisan Energy Policy Act of 2005. Geothermal revenue sharing accounts for less than one half of one percent of the total federal deficit. Ending this sharing would negatively impact counties.

Currently, counties use geothermal revenues to pay for governmental services, such as road maintenance, public safety and law enforcement, and conservation easements.

Many of the counties receiving revenue from geothermal receipts are small, rural counties like Lake, facing uncertain budget situations.

The loss of such revenue for these counties could result in the elimination or reduction of essential services.

"Geothermal energy brings jobs and growth to Nevada with 20 plants in operation providing clean, reliable electrical capacity to the grid and significant additional capacity under development," said Congressman Amodei. "Given the important role of the counties in the development of this domestic energy source, it's only proper that they should share in the revenue of the federal receipts."

“By generating geothermal energy, my home county of Sonoma is making an important contribution to an environmentally sustainable future,” said Congresswoman Woolsey (CA-6). “The royalties Sonoma earns from that production pay for the services our people expect and deserve from their local government, at a time when our county is facing a fiscal crunch. This very modest federal investment yields a significant return – these royalties must not be eliminated in the President’s budget.”

“In his State of the Union address, President Obama called on America to double down on our clean energy investments. I agree, and that’s why I support preserving incentives for geothermal development, which help us produce affordable American-made renewable energy and strengthen our energy independence,” Congressman Garamendi (CA-10) said. “This revenue is essential to many rural communities, especially in Northern California. Cutting geothermal royalties would be shortsighted, devastating vital public services while doing virtually nothing to address the deficit. I urge the President to maintain his commitment to clean energy by preserving geothermal royalties for local communities.”

“Geothermal development comes at a cost,” Thompson continued. “Our counties spend money on public safety, road maintenance and law enforcement in and around areas where geothermal is produced.”

The full text of the letter is below.


February 1, 2012

President Barack Obama
The White House
1600 Pennsylvania Ave
Washington, DC 20500

Dear President Obama,

As you draft your Fiscal Year 2013 Budget proposal, we urge you not to include a repeal of the sharing of geothermal royalty payments to counties. We understand the need to propose a fiscally prudent budget, but repealing geothermal royalty payments to counties is a short sighted method that does nearly nothing to solve our fiscal problems.

In the bipartisan Energy Policy Act of 2005, Congress decided that because of the high burdens geothermal production places on the counties where geothermal development is located, these counties should share in the revenue of the federal receipts. In turn, counties have used these revenues to pay for critical governmental services, such as road maintenance, public safety and law enforcement, and conservation easements. This revenue sharing has also made counties vested partners, and ultimately champions, in the continued development of geothermal energy — a clean, renewable, and domestic energy source that provides jobs in rural areas.

Ending the geothermal revenue sharing plan would have a significant negative impact on our districts, while the overall effect on our nation’s fiscal well-being would be miniscule — less than $7 million a year. Many of the counties that receive revenue from geothermal receipts are small, rural counties facing precarious budget situations. The loss of such revenue for these counties could result in the elimination or reduction of essential services. As such, we urge you not to include the repeal of geothermal revenue sharing with counties in your Fiscal Year 2013 Budget proposal.

We appreciate your attention to this issue and look forward to working with you as you prepare your budget.

Congressman represents California’s First Congressional District, which includes the Counties of Del Norte, Humboldt, Lake, Mendocino, Sonoma, Napa and Yolo.

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