Background:

Geothermal Wells.

The Department of Natural Resources (DNR) is responsible for administering and enforcing state laws related to the drilling, operation, maintenance, abandonment, and restoration of geothermal resources.

A permit must be issued by the DNR before any person may drill a new well, or redrill an abandoned well, that is to be used for geothermal resource extraction. Permits are only approved by the DNR if the well is found to be in the best interest of the state and if the well will not unreasonably decrease groundwater available to senior water right holders.

When the DNR receives an application to drill or redrill a well for geothermal resource extraction, the DNR must hold a public hearing on the application in the county of the well. Public hearing notices must be published twice in a newspaper of general circulation within the county.

The fee for a permit to drill, redrill, or deepen a geothermal resources well is $200. This fee revenue is deposited into the general fund. Under DNR rules, permit fees are not required for the drilling of core holes used for the purposes of gathering geothermal data.

Geothermal Core Holes.

Core holes are holes or excavations made expressly to acquire geological or geophysical data to find and delineate a favorable geothermal area, prior to drilling a geothermal well.

Drilling a core hole for the purposes of gathering geothermal data requires the same DNR permit as geothermal well drilling or redrilling, and are generally subject to the same DNR rules as geothermal wells. However, core holes do not require a public hearing or the issuance of public notice. Statute provides that the drilling of core holes are subject to a permit fee for each core hole, but the DNR's adopted rules do not require the payment of a permit fee for drilling core holes.

Core holes that penetrate at least 750 feet into bedrock are deemed geothermal test wells and are consequently subject to the $200 per-hole permit fee and public hearing and notice requirements. In addition, if a core hole results in the discovery of geothermal energy, the core hole is deemed to be a well and is likewise made subject to permit fee, public hearing, and public notice requirements.

State Environmental Policy Act Treatment of Geothermal Wells.

The State Environmental Policy Act (SEPA) establishes a review process for state and local governments to identify environmental impacts that may result from governmental decisions, such as the issuance of permits or the adoption of land use plans. Except for projects that are exempt from SEPA requirements, the SEPA generally requires a project applicant to submit an environmental checklist that includes answers to questions about the potential impacts of the project on the built and natural environments. Under SEPA, a government agency is designated as the lead agency, and in that role is assigned responsibility for complying with SEPA's procedural requirements, including making a threshold determination and preparing the environmental impact statement (EIS) when one is required. The information collected through the SEPA review process may be used to condition a proposal to mitigate environmental impacts or to deny a proposal when significant adverse environmental impacts are identified.

The SEPA statute and rules contain exemptions for certain actions that do not require the submission of a checklist or the development of an EIS. The SEPA rules are adopted and updated by the Department of Ecology. In addition to broad exemptions that apply to categories of projects regardless of the identify of the project proponent, the SEPA rules also categorically exempt specified types of activities that are conducted by certain state agencies. The DNR activities that are categorically exempt from the SEPA include the issuance of permits for geothermal test drilling for which a public hearing is not required.