Texas Land Commissioner Dawn Buckingham announced on Sept. 15, 2026, that the General Land Office (GLO) was opening a request for information on geothermal and small modular nuclear projects on state land. The agency manages more than 13 million acres of state land and mineral interests for the Permanent School Fund. The request is the first part of its Texas Engine initiative. As Buckingham put it, “Texas built its economy by putting our natural resources to work.”
The request invites developers to describe what they might build; it grants no lease or permit. This is an important shift in Texas geothermal policy. For several years, researchers, lawmakers, and regulators have been building the rules and legal pathways projects would need. The GLO is now asking whether developers are ready to use them.
Where the groundwork came from
Texas has spent the last several years clearing the legal and regulatory questions that can stop geothermal projects before they start. In 2023, Project InnerSpace supported The Future of Geothermal in Texas, a study involving researchers from five Texas universities. It examined the state’s geothermal resources, the skills its oil and gas industry could bring to geothermal, and the legal questions developers would face. Later that year, the Legislature passed three bills that provide a strong legal foundation for geothermal in the Lone Star state.
- SB 785 established that the surface owner owns the geothermal resource, including where the mineral estate has been severed.
- SB 786 consolidated geothermal permitting under the Railroad Commission of Texas (RRC).
- SB 1210 created a pathway for operators to adopt orphaned oil and gas wells and convert them for geothermal use.
Together, the three laws answered basic questions developers need settled before investing: who owns the geothermal resource, which regulator oversees closed-loop wells, and whether orphaned oil and gas wells can be put back to work.
In 2025, Texas went even further. HB 4370 classified geothermal water conveyance systems as eligible public improvement projects, giving cities and special districts a pathway to develop and finance them with public bonds. Texas also clarified that geothermal can qualify for the Texas Energy Fund’s technology-neutral completion bonus. Eligible generation connecting to ERCOT before June 2029 can receive up to $80,000 per megawatt, subject to program requirements and available funding—up to $40 million for a qualifying 500 MW project.
The permitting record so far
The new regulatory framework is already being used, although the first deep permits have been for geothermal-based energy storage rather than electricity generation. In a July 2026 update, the RRC reported that it had issued its first deep geopressured geothermal well permit to Sage Geosystems in Atascosa County. That July, it issued a second permit to Quidnet Energy Deployment for an energy-storage well in Galveston County.
The RRC has also reported rapid growth in shallow closed-loop wells used primarily for heating and cooling, attributing part of that growth to rules clarifying the permitting process.
Why Texas
The reason this framework matters more in Texas than it might elsewhere is that the state does not have to build a drilling ecosystem from scratch. Texas produced more primary energy than any other state in 2024. It already has the rigs, service companies, subsurface data, engineering expertise, and workforce that next-generation geothermal can draw on. Policy cannot create a geothermal resource or a drilling industry. Texas already has both. What policy can do is make it easier to turn those advantages into projects.
What comes next
Texas has already shown what the next step can look like for another emerging source of firm power. In 2025, lawmakers created the Texas Advanced Nuclear Development Fund and appropriated $350 million to it. The program can reimburse early project-development costs, including feasibility studies, site planning, engineering, site characterization, and permitting work, while also supporting later-stage construction.
What geothermal does not yet have is an equivalent tool aimed at early-stage project risk. The Texas Energy Fund’s completion bonus can reward a qualifying project that reaches the grid; it does not solve the upfront cost of characterizing a geothermal resource, drilling the first wells, and proving that a commercial project is there. Texas has clarified regulatory authority, created pathways to use existing wells and infrastructure, and is now asking developers what they could build on state land. The next policy question is whether the state should also help absorb the early development risk that stands between a promising resource and a commercial project.
That is the larger opportunity for 2027: a targeted mechanism that helps developers characterize resources, drill and validate early wells, and move successful projects to private financing. Texas has already built that kind of first-mover support for advanced nuclear. The question is whether geothermal should get its own version.
Texas has spent several years making geothermal easier to permit. The next step is making the first commercial projects easier to get built.