On April 11, 2025, the Colorado State Legislature introduced House Bill 1165, aimed at enhancing the management and oversight of underground carbon dioxide (CO2) storage facilities and geothermal energy resources. This legislative proposal seeks to address significant gaps in current regulations, particularly concerning the long-term stewardship of CO2 storage sites, which have been highlighted by various state studies and task forces.

The bill's primary purpose is to establish a structured process for the ongoing monitoring and maintenance of CO2 storage facilities, especially in cases where operators cease to exist, such as through bankruptcy. Currently, there is no framework in place to ensure these sites are adequately managed after closure, raising concerns about potential environmental impacts on local communities. To mitigate these risks, House Bill 1165 proposes the creation of an enterprise funded by fees imposed on geologic storage operators. This funding mechanism would provide the necessary resources for the state to conduct long-term stewardship activities, thereby protecting Colorado communities and supporting the state's climate goals.

In addition to CO2 storage, the bill recognizes the potential of geothermal energy as a reliable and low-carbon energy source. It emphasizes the importance of regulating geothermal development in Colorado, which is overseen by the energy and carbon management commission and the division of water resources. The bill builds on previous legislative efforts, specifically Senate Bill 23-285, which directed these bodies to evaluate the state’s regulatory framework for geothermal resources and recommend necessary changes.

Debates surrounding House Bill 1165 have focused on the balance between environmental protection and the economic implications for energy operators. Proponents argue that the bill is essential for ensuring public safety and environmental integrity, while critics express concerns about the financial burden on storage operators and the potential impact on energy costs.

The implications of House Bill 1165 are significant, as it not only aims to safeguard Colorado's drinking water sources from potential contamination but also supports the state's transition to a low-carbon economy. By establishing a clear regulatory framework for CO2 storage and geothermal energy, the bill could foster economic growth and innovation in the energy sector while addressing pressing climate challenges.

As the legislative process unfolds, stakeholders will be closely monitoring discussions and potential amendments to the bill, which could shape the future of energy management and environmental stewardship in Colorado.