Domestic geothermal reserves have the potential of developing into regionally significant energy sources promoting the economic health and national security of the US. Though there are institutional and economic barriers to the commercialization of geothermal technology, the Federal agencies make attempts to use geothermal energy in the Government buildings.
The Secretary of Energy is authorized to make a loan to any person from funds appropriated to the Geothermal Resources Development Fund established to assist such person in undertaking and carrying out a project which is designed to explore and determine the economic viability of a geothermal reservoir and consists of surface exploration and the drilling of exploratory wells.
Any loan is repayable out of revenue from production of the geothermal energy reservoir with respect to which the loan was made, at a rate which does not exceed 20% of the gross revenue accumulated from the reservoir in that year.
The Secretary of Energy has the authority to cancel the unpaid balance and any accrued interest on any loan if he determines that the geothermal energy reservoir with respect to which the loan was made has characteristics which make that particular reservoir economically or technically unacceptable for commercial production.
The amount of any loan does not exceed 50 %. In any case no loan shall be made in an amount in excess of $3,000,000. The term for each loan is determined by the Secretary, but no loan term can exceed twenty years beyond the date on which production of geothermal energy resources begins from the reservoir. If revenues are inadequate to repay the principal and interest amount within twenty years after the commencement of production, any remaining unpaid amounts shall be forgiven.
