The HEATS Act of 2026 exempts certain geothermal energy projects on non-federal surface lands from federal drilling permit requirements when state-level permits are obtained.
John Hoeven
Senator
ND
The Harnessing Energy At Thermal Sources (HEATS) Act of 2026 streamlines geothermal energy development by eliminating federal drilling permit requirements for projects on non-federal surface land where the U.S. holds less than 50% of the subsurface mineral interest. Under this legislation, operators may proceed with state-approved projects without undergoing federal environmental reviews, provided they continue to meet existing royalty obligations. These exemptions do not apply to Indian lands or resources held in trust for Indian Tribes.
HEATS Act Cuts Federal Red Tape for Geothermal Drilling: Projects Can Start 30 Days After State Approval
The Harnessing Energy At Thermal Sources (HEATS) Act of 2026 aims to put the pedal to the metal on geothermal energy by removing federal permitting hurdles. Specifically, if the U.S. government owns less than 50% of the underground heat resources and a company already has a state permit in hand, the Secretary of the Interior can no longer require a separate federal drilling permit. Once that state permit is filed with the feds, companies can start digging just 30 days later without waiting for the usual federal green light.
Fast-Tracking the Heat
Under Section 2, this bill essentially tells federal agencies to step aside if a state has already given the thumbs up. By removing these projects from the 'major federal action' category, it bypasses the National Environmental Policy Act (NEPA), which usually requires deep-dive environmental reviews. For a geothermal developer, this could mean saving months or years of bureaucratic waiting. For a worker in the energy sector, it might mean projects move from the planning phase to the construction site much faster. However, the trade-off is that these projects also skip Section 7 of the Endangered Species Act, meaning federal experts won't be required to weigh in on how the drilling might affect local wildlife or habitat conservation.
The Fine Print on Land and History
The bill creates a bit of a 'patchwork' when it comes to protecting history and local communities. If a project qualifies for the federal permit exemption, historic preservation reviews only happen if the state has its own laws on the books to handle it. If you live in a state with lax preservation rules, a new geothermal site could theoretically go up near a local landmark without the federal oversight that usually keeps those sites protected. On the flip side, the bill is very clear about Indian lands: these new permit shortcuts do not apply to reservations, trust lands, or dependent Indian communities (SEC. 2). While this protects tribal sovereignty over their own soil, it doesn't explicitly address what happens if a project just outside tribal borders impacts shared water or air quality.
Keeping the Receipts
Even though the feds are losing their power to say 'yes' or 'no' to the drilling itself, they aren't walking away from the money. The HEATS Act ensures that royalty payments—the cut of the profit the government takes for using public resources—stay exactly the same. The Secretary of the Interior maintains the right to show up for onsite inspections to make sure the energy is being measured correctly and that the U.S. Treasury is getting every cent it’s owed. So, while the environmental and species protections are being dialed back to speed up production, the financial auditing remains in full force.