30 U.S.C. § 1522 : US Code - Section 1522: Establishment of program

Search 30 U.S.C. § 1522 : US Code - Section 1522: Establishment of program

(a) Authorization; requirements; scope
If the report of the Secretary submitted pursuant to section 1521
of this title affirmatively recommends the establishment of the
program and the Congress by law (after review of such
recommendation) specifically authorizes the establishment of the
program, the Secretary shall establish and implement within six
months after the date of the enactment of such authorization a
program, in cooperation with the insurance and reinsurance
industry, to provide reservoir insurance to qualified eligible
applicants in accordance with this section.
(b) Definitions
For the purpose of this section -
(1) the term "investment" means the expenditure of, and any
irrevocable legal obligation to expend, funds (together with the
reasonable interest costs thereof) for the purchase or
construction of machinery, equipment, and facilities
manufactured, or for services contracted to be furnished, for the
development and utilization of a geothermal resource in the
United States to provide energy in the form of heat for direct
use or for generation of electricity;
(2) the term "geothermal resource" means a resource in the
United States including (A) all products of geothermal processes
embracing indigenous steam, hot water, and hot brines; (B) steam
and other gases, hot water and hot brines resulting from water,
gas, or other fluids artificially introduced into geothermal
formations; (C) heat or other associated energy found in
geothermal formations; and (D) any byproducts derived from them,
where "byproduct" means any mineral or minerals (exclusive of
oil, hydrocarbon gas, and helium) which are found in solution or
in association with other geothermal resources and which have a
value of less than 75 per centum of the value of the geothermal
steam or are not, because of quantity, quality, or technical
difficulties in extraction and production, of sufficient value to
warrant extraction and production by themselves;
(3) the term "risk" means the hazard that a reservoir of
geothermal resources will cease to provide sufficient quantities
of geothermal resources at minimum conditions required to
maintain an economically or technically viable operation for
utilization of the geothermal resource;
(4) the term "reasonable premiums" means premium amounts
determined by the Secretary to be reasonable in light of the
amount of investment subject to the risk and premiums charged in
similar or analogous situations by private insurers where private
insurance is concerned and by insurers or guarantors, both public
and private, where public insurance is concerned;
(5) the term "other insurance" means any combination of private
or public insurance other than investment insurance provided by
the Secretary under this section;
(6) the term "reservoir" means the physical subsurface geologic
structure which forms the natural repository for the undisturbed
geothermal resource; and
(7) the term "person" means any public or private agency,
institution, association, partnership, corporation, political
subdivision, or other legal entity which is a United States
citizen as determined by application of the test for United
States citizenship contained in section 2(a)-(c) of the Shipping
Act, 1916 [46 App. U.S.C. 802], or in the first sentence of
section 27A of the Merchant Marine Act, 1920 [46 App. U.S.C. 883-
1(a)-(e)].
(c) Eligibility for investment insurance
Any person with a total direct investment of not less than
$1,000,000 in the development and use, not including exploration
and testing, of a geothermal resource associated with a reservoir,
and unable to obtain other insurance at reasonable premiums for the
amount of the investment subject to risk, as determined by the
Secretary under this section, shall be eligible for investment
insurance.
(d) Application for investment insurance; contents, etc.
Any eligible person seeking investment insurance under this
section shall file an application with the Secretary setting forth
(1) the total amount of the contemplated investment in a geothermal
resource and associated reservoir; (2) the views of the applicant
concerning the nature and extent of the risk, including a geologic,
engineering, and financial assessment based on site specific
results of exploration and testing of the geothermal resource and
the reservoir, stated with as much specificity as is possible; (3)
the status of all required Federal, State, and local approvals,
permits, and leases for the proposed development and utilization
operations at the site; (4) the extent to which the applicant has
been able to obtain other insurance against the risk; and (5) such
other information as the Secretary may require.
(e) Determinations respecting application for insurance
Unless the Secretary determines the risk proposed by the
applicant is unreasonable, the Secretary, within ninety days after
receipt of a satisfactory application, shall determine in writing
and submit to the applicant (1) the risk which may cause loss of
investment for the applicant; (2) the total investment subject to
the risk; (3) the amount of the other insurance which is available
at reasonable premiums for the purpose of indemnifying the
applicant against the risk; (4) the amount of investment insurance
available pursuant to this section, which shall be the difference
between the total investment subject to the risk and the total
other insurance determined to be available at reasonable premiums,
but not in excess of the lesser of 90 per centum of, or $50,000,000
of, the loss of investment subject to the risk; and (5) any
reasonable terms and conditions necessary for the prudent
administration of the program, including reasonable premiums for
the insurance pursuant to this section (which shall be deposited in
the Geothermal Resources Development Fund).
(f) Certificate of insurance; issuance, etc.
The Secretary, within ninety days after making and submitting the
determinations under subsection (e) of this section, and upon
agreement of the applicant to such determinations, shall issue a
certificate of insurance containing such terms and conditions as
the Secretary shall specify, which shall not be transferrable
without the express approval of the Secretary for good cause shown,
and shall execute a contract with the applicant setting forth the
terms and conditions of the investment insurance and such other
provisions as may be necessary to protect the interests of the
United States, including provisions with respect to the ownership,
use, and disposition of any currency, credits, assets, or
investments on account of which payment under such insurance is to
be made and any right, title, claim, or course of action existing
in relation thereto.
(g) Compensation payable to holder of certificate of insurance;
amount, etc.
Any holder of a certificate of insurance pursuant to subsection
(f) of this section who claims a loss of value of his investment by
reason of the specified risk shall receive compensation, to the
extent the Secretary determines that the holder is eligible to
receive compensation pursuant to the certificate and the contract,
in the amount of the loss incurred by the holder which is subject
to insurance and for which the holder has not received and will not
receive compensation from other insurance.
(h) Withdrawal and payment of compensation
Any compensation received by the holder shall be withdrawn from
the Geothermal Resources Development Fund. The full faith and
credit of the United States is hereby pledged to the payment of any
compensation under this section.
(i) Denial of insurance
A person shall not be denied insurance pursuant to this section
solely because such person is the recipient of other Federal
assistance under this or any other Act.
(j) Appropriations
There may be appropriated to the Geothermal Resources Development
Fund (established pursuant to section 1144 of this title), for
purposes of this section, such amounts as are authorized for such
purposes in the law referred to in subsection (a) of this section
or in other legislation hereafter enacted.
(k) Reinsurance agreements; procedures applicable; criteria; report
to Congress
The Secretary may enter into agreements to reinsure any private
insurer for any risk associated with insurance for the development
and utilization of a geothermal resource and associated reservoir,
using the procedures set forth in subsections (c) through (i) of
this section, to the extent that he deems it appropriate in order
to provide an incentive for the participation of the private
insurance industry in geothermal development; and he may also use
any other available authority to obtain such participation. The
Secretary shall submit a report to the Congress, within one year
after the enactment of the law referred to in subsection (a) of
this section, on the need for any additional authority to obtain
such participation.