Geothermal Resources Act

The purpose of the Geothermal Resources Act is two-pronged: it claims for the government the right, title and interest in the province’s “geothermal resources”; and it provides the legal framework for the government to dispose of those rights, title and interests, on terms acceptable to the government.  The Act is administrated by the Minister of Energy and Mines.

The Act was created during the 1970s energy crisis, when widespread concerns about the potential shortage of crude oil prompted investigations into the potential for alternative energy sources, including geothermal energy.  British Columbia, through B.C. Hydro and Power Corporation, carried out a research program to identify and assess the province’s geothermal resources.  The province also enacted legislation to provide a framework for enabling private, commercial development of the resources.

The Act defines “Geothermal resources” as:

“...the natural heat of the earth and all substances that derive an added value from it, including steam, water and water vapour heated by the natural heat of the earth and all substances dissolved in the steam, water or water vapour obtained from a well, but does not include

(a)    water that has a temperature less than 80 [degrees] C at the point where it reaches the surface, or

(b)   hydrocarbons...”

The Act regulates all activities related to geothermal resources, including:

·          geothermal exploration activities (such as seismic, geochemical or geological operations, or well drilling); and

·          geothermal well production activities, such as electrical power generation.

Geothermal exploration activities may only be carried out under authority of a permit.  Permits are associated with locations, and they are awarded following a public tender process.  The maximum size of a location for which a permit may be issued is a block.  Permits remain in effect for one year, but may be renewed for up to a seven-year period.  The holder of a permit is required to pay rent and is also required to carry out exploration activities to a certain minimum value - failing which additional rent is owed to the government in lieu of such exploration activities.

Geothermal energy production may only be carried out under the authority of a geothermal lease.  The tenure of a geothermal lease is 20 years, though there are provisions for renewals.  Associated with the lease is an agreement to pay royalties to the government – the government’s means for securing a direct financial return for the province’s geothermal assets.

Regulations under the Act include:

·          Geothermal Resources Administrative Regulation

·          Geothermal Geophysical Exploration Regulation (which stipulates that the Geophysical Exploration Regulation under the Petroleum and Natural Gas Act applies to geothermal resource geophysical exploration)

·          Geothermal Drilling and Production Regulation

Significance of the Geothermal Resources Act for Watershed Protection:

Decisions and geothermal exploration or power production activities carried out under the authority of the Geothermal Resources Act may impact upon watersheds.  Possible impacts could include:

·          road service corridor construction

·          electrical transmission corridor construction

·          the introduction of heavily mineralized groundwater into surface ecosystems – in particular, into streams, rivers, and lakes

·          air emissions such as hydrogen sulfide and some CO₂

·          potential for impacts on sensitive habitats and species specific to geothermal ecosystems (e.g. hotspring ecosystems)

For more information on the Geothermal Resources Act or geothermal energy:

·          Electronic version of Geothermal Resources Act.

·          Electronic version of Geothermal Drilling and Production Regulation.

·          Electronic version of Geothermal Geophysical Exploration Regulation.

·          Electronic version of Geothermal Resources Administrative Regulation.

·          Electronic version of Geophysical Exploration Regulation.

·          The Geothermal Resources page of the B.C. Ministry of Energy and Mines website. 

·          Canadian Geothermal Energy Association website.

·          International Geothermal Association.