Congress quietly extends oil-industry tax breaks to geothermal firms
H.R. 6873 — Geothermal Tax Parity Act · Filed by Celeste Maloy (R-UT) · 5 cosponsors · Introduced Dec 18, 2025 · Referred to committee
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What it does
This bill amends the tax code to give geothermal energy companies the same tax breaks currently available to oil and gas companies. Specifically, it allows geothermal firms to deduct (amortize) geological and geophysical exploration and development costs over time, and exempts geothermal working interests from passive-loss limitations that normally restrict tax deductions. The result: geothermal companies pay less federal tax on their operations, matching the treatment oil and gas already receive.
Why we flagged it
The bill's operative mechanism is a tax deduction carve-out—it reduces the tax burden on a specific industry sector by extending existing oil-and-gas tax preferences to geothermal firms. This is a direct financial subsidy delivered through the tax code, not a regulatory reform or public-interest mandate.
What the text implies
- The bill extends tax benefits without requiring geothermal firms to meet any environmental performance standards, renewable-energy production targets, or consumer-price commitments, making it a pure tax giveaway rather than a climate or energy-policy instrument.
- By matching oil-and-gas treatment, the bill may entrench geothermal as a 'legacy' energy sector eligible for ongoing tax preferences, potentially creating political pressure to extend similar breaks to other energy sources.
The full analysis lists 3 implications of this text.
Who stands to gain
geothermal energy companies; geothermal project developers; investors in geothermal working interests