C.R.S. § 40-2-143: Geothermal energy development - small-scale geothermal projects - large-scale geothermal projects - commission duties - labor requirements - rules - definitions.

(1) Definitions. As used in this section, unless the context otherwise requires:

(a) "Investor-owned electric utility" or "utility" means an investor-owned utility that provides retail electric service to customers in the state and is regulated by the commission.

(b) "Large-scale geothermal project" means a geothermal project or geothermal projects identified by a utility pursuant to subsection (3) of this section that individually or in aggregate produce more than twenty-five megawatts of nameplate electric generating capacity.

(c) "Net electric generating capacity" means the maximum continuous electrical output, expressed in megawatts, delivered to the transmission or distribution system, excluding auxiliary or parasitic loads required for on-site plant operations.

(d) "Small-scale geothermal project" means a geothermal project identified by a utility pursuant to subsection (2) of this section that produces twenty-five megawatts or less of nameplate electric generating capacity.

(2) Small-scale geothermal projects.

(a) An investor-owned electric utility shall identify one or more potential small-scale geothermal projects at specific locations or as community geothermal gardens, as defined in section 40-2-127.5 (2)(a).

(b) When considering the development of small-scale geothermal projects, an investor-owned electric utility shall issue a request for proposals to solicit proposals and bids for development of small-scale geothermal projects that the utility shall submit to the commission in accordance with subsection (2)(c) of this section.

(c) No later than one hundred twenty days after an investor-owned electric utility concludes the request for proposals conducted in accordance with subsection (2)(b) of this section, the investor-owned electric utility shall submit an application to the commission for the development of small-scale geothermal projects if the utility receives a bid in response to the request for proposals solicited in accordance with this subsection (2), which application must include:

(I) A description of the small-scale geothermal project and whether it is location specific or a community geothermal garden;

(II) The proposed location of the small-scale geothermal project;

(III) The amount of electricity, measured in megawatt-hours, that will be generated from the small-scale geothermal project; and

(IV) An estimate of the projected total capital cost and operating cost of the small-scale geothermal project and the impact that the cost will have on the utility's customers.

(d) The commission shall approve, conditionally approve, deny, or modify an investor-owned electric utility's application submitted pursuant to this subsection (2) within one hundred twenty days after receiving the application, or within one hundred eighty days after receiving the application, for good cause shown.

(e) In evaluating a small-scale geothermal project bid or proposal, the commission shall evaluate the bid or proposal submitted by an investor-owned electric utility based on factors that include:

(I) The projected total capital and operating cost of the small-scale geothermal project and the project's impact on ratepayers is reasonable in consideration of greenhouse gas emission reductions and other relevant benefits, including resource adequacy needs, long-term capacity accreditation, the need for clean firm generation resources, and achieving state energy policy goals, as determined by the commission; and

(II) The development of the small-scale geothermal project is in the public interest.

(f) As part of an application submitted to the commission pursuant to this subsection (2), the investor-owned electric utility shall request, as appropriate:

(I) A certificate of public convenience and necessity;

(II) Approval for any procurement agreements and associated cost recovery by the investor-owned electric utility; and

(III) Approval of a return on invested capital recovery approach for any used and useful project owned by the investor-owned electric utility that is developed in accordance with this section.

(3) Large-scale geothermal projects.

(a) (I) When considering the development of large-scale geothermal projects, an investor-owned electric utility shall issue a request for proposals to solicit proposals and bids for development of large-scale geothermal projects that the utility shall submit to the commission in accordance with subsection (3)(b) of this section.

(II) When soliciting a request for proposals in accordance with this subsection (3)(a), the investor-owned electric utility shall target the acquisition or development of no more than three hundred megawatts of nameplate electric generating capacity from large-scale geothermal projects.

(b) No later than one hundred twenty days after an investor-owned electric utility concludes the request for proposals conducted in accordance with subsection (3)(a) of this section, the investor-owned electric utility shall submit an application to the commission for the development of large-scale geothermal projects if the utility receives a bid in response to the request for proposals solicited in accordance with this subsection (3), which application must include:

(I) A description of the large-scale geothermal project and whether it is a single project or an aggregate of multiple geothermal projects;

(II) The proposed location or locations of the large-scale geothermal project;

(III) The total amount of electricity, measured in megawatt-hours, that will be generated from the large-scale geothermal project and the accredited capacity associated with the project or projects;

(IV) An estimate of the projected total capital cost and operating cost of the large-scale geothermal project and the impact that the cost will have on the utility's customers;

(V) The proposed ownership structure for the large-scale geothermal projects, which may include full or partial build transfer ownership structures, joint ventures, or independent power production ownership structures with a power purchase agreement; and

(VI) A description of any specific customer or group of customers that the investor-owned electric utility may partner with to support the development of a large-scale geothermal project in accordance with subsection (3)(d) of this section.

(c) The commission shall approve, conditionally approve, deny, or modify an investor-owned electric utility's application submitted pursuant to this subsection (3) within one hundred twenty days after receiving the application, or within one hundred eighty days after receiving the application, for good cause shown.

(d) In evaluating a large-scale geothermal project bid or proposal, the commission shall evaluate the bid or proposal submitted by an investor-owned electric utility based on whether:

(I) The projected total capital and operating cost of the large-scale geothermal project and the project's impact on ratepayers is reasonable in consideration of reliability, greenhouse gas emission reductions, and other relevant benefits, including resource adequacy needs, long-term capacity accreditation, the need for clean firm generation resources to make progress toward the economy-wide goal of net-zero emissions by 2050, and achieving state energy policy goals, as determined by the commission; and

(II) The development of the large-scale geothermal project is in the public interest.

(e) As part of an application submitted to the commission pursuant to this subsection (3), the investor-owned electric utility may request, to the extent necessary:

(I) A certificate of public convenience and necessity;

(II) Approval for any procurement agreements and associated cost recovery by the investor-owned electric utility; and

(III) Approval of a return on invested capital recovery approach for any project owned by the investor-owned electric utility that is developed in accordance with this section.

(f) An investor-owned electric utility may only submit one application to the commission pursuant to this subsection (3). An investor-owned electric utility shall use the experience from conducting the solicitation and submitting an application pursuant to this subsection (3) to inform the utility's approach in future electric resource plan proceedings related to geothermal energy development and other clean firm technologies.

(4) Labor requirements. A small-scale geothermal project or a large-scale geothermal project authorized pursuant to this section that is considered an energy sector public works project, as defined in section 24-92-303 (5), must comply with:

(a) The prevailing wage requirements in part 2 of article 92 of title 24;

(b) The apprenticeship utilization requirements in section 24-92-115 (7); and

(c) The labor requirements in part 3 of article 92 of title 24.

(5) Rules. The commission may adopt any rules necessary to implement and enforce this section.