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 utilize 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.
This bill provides that "geothermal exploratory project" includes, among other things, equipment and activities necessary to establish interconnectivity between wells and reservoirs. The bill would, until January 1, 2031, exempt geothermal exploratory projects for which the county is the lead agency that meet specified conditions from CEQA. The bill would authorize the lead agency to require the project applicant to file an indemnity bond before it makes its determination pursuant to this exemption, as specified. The bill would require the lead agency, at least 30 days before the making the determination to approve or carry out a change in use pursuant to this exemption, to post a written notice on its internet website and at the project site. The bill would require, if the lead agency determines that the project is not subject to CEQA pursuant to this exemption, 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. Because the exemption would apply to projects where the county is the lead agency and the county would be required to determine if a project qualifies for this exemption, the bill would impose a state-mandated local program.
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.

Statutes affected:
04/10/25 - Amended Assembly: 21065.5 PRC, 21065.5 PRC
04/21/25 - Amended Assembly: 21065.5 PRC
05/05/25 - Amended Assembly: 21065.5 PRC
06/24/25 - Amended Senate: 21065.5 PRC