Colorado signs bill to encourage local governments and utilities to develop geothermal energy
Colorado Governor Polis signs SB26-142 - Development of Thermal Energy Resources (source: Colorado Governo'r's Office)
Carlo Cariaga
2 Jun 2026
Colorado Governor Jared Polis has signed into law a new bill that aims to encourage local governments to participate in geothermal development.
Colorado Governor Jared Polis has signed into law a proposed bill that aims to reduce regulatory hurdles for thermal energy network providers while encourage local electric utilities to participate in developing geothermal power projects.
Senate Bill 26-142 (Development of Thermal Energy Resources) sponsored by Senators Matt Ball and Cathy Kipp, and Representatives Junie Joseph and Ryan Gonzalez, aims to contribute in boosting the development of low-cost, innovative clean energy solutions like geothermal.
The new law authorizes a local government (or a special district thereof) to enter into an agreement with entities for the purpose of providing the local government with the service from a thermal energy network. The local government may issue bonds for the purpose of financing thermal energy infrastructure, interconnections, or customer connections within the jurisdiction of the local government.
It also requires investor-owned electric utilities to solicit proposals for the development of small-scale (up to 25 MW) or large-scale (25 MW or more) geothermal power projects. If the utility receives such proposals, an application for the project must be submitted to the public utilities commission for approval. This decision must be granted within 120 days of receiving the application.
The law also requires the Colorado Energy and Carbon Management Commission (ECMC) and the Colorado Geological Survey to collect data and information related to the geological resources in the state. The ECMC shall then make recommendations for the safe and effective development of geothermal resources, which will be reported to the general assembly on or before 15 November 2026.
“In Colorado we are harnessing the heat beneath our feet. Geothermal energy is reliable, clean, low-cost energy and helps protect Coloradans from the unpredictable price of gas. This law will boost geothermal to save people money on energy and protect our environment. Colorado is open for geothermal business and we welcome innovative clean energy solutions to make energy more affordable, sustainable, and reliable,” said Governor Polis.
Colorado was one the four states that recently announced the creation of the new Mountain West Geothermal Consortium, bringing together state officials to provide coordinated insights, share resources, and jointly create tools and mechanisms to de-risk investment in geothermal and accelerate geothermal development.
Source: Colorado Governor’s Office and Colorado General Assembly
