Assembly Standing Committee on Utilities and Energy

Okay. Good afternoon, everyone, and welcome to the Utilities and Energy Committee hearing. It is a joint hearing with the Select Committee on California's Lithium Economy. I want to welcome everyone to the Capitol. I'll call this joint hearing to order and recognize that our colleagues are here and they'll have a chance to say a few words in a minute. This is the Assembly Committee. Utilities Energy and Select Committee on California lithium Economy. We're here for an informational hearing to discuss the report of the Lithium Valley Commission.

Before we begin, I have some housekeeping to go over. There will be no phone testimony, so public comment will be either in person or submitted via email, and that email is on our committee's website. Additionally, I will maintain the quorum during the hearing as customary, and so we can just stay focused on the conversation that is in front of us. A few words here.

Global lithium demand is expected to grow over the next decade, driven largely by increasing demand for lithium ion batteries in electric vehicles and energy storage in the electric sector. However, domestic supplies of lithium are sparse, with the majority of global production arising from Chile, Australia, Argentina, and China. Despite this deficit, the Salton Sea Geothermal Resource Area, otherwise known as Lithium Valley, is home to the largest lithium deposit in North America.

Given this unique opportunity, the Lithium Valley Commission was established in 2020 to explore the opportunities and challenges surrounding lithium recovery from geothermal brines around the sea. In December 2022, the Commission submitted a report to the Legislature on findings and recommendations on what is needed to build California's lithium industry. As such, the purpose of this hearing is to understand the findings and the recommendations of this report and the myriad of opportunities and challenges that come with building a domestic lithium supply chain.

This discussion today will also be centered on updates of the federal and state efforts to build this emerging industry to reduce the United States'reliance on foreign lithium suppliers. Additionally, we will hear updates from lithium developers on their projects. Despite this momentum, at the center of these undertakings is a community that wants to ensure this emerging industry will not develop at the expense of their public and environmental health. With that, I turn to my colleagues to see if anyone has any opening remarks. Okay, please.

Thank you, Mr. Chair. Thanks for putting this committee informational hearing together. And thank you to the staff for the work they did to prepare. Oftentimes we talk about jobs, clean energy, and environmental sustainability in our Utilities and Energy Committee. And now with the Lithium Valley Commission, we know that they have a nexus to all three.

Lithium Valley could be one of the state's most important energy projects in the state's history due to the energy potential that exists in its geothermal fields, the economic growth it can provide the local community, and the critical lithium it can produce for battery development. We know we're going to need historic levels of lithium if we are going to build out the battery capacity to meet our zero emission energy and transportation needs.

I want us to be successful in meeting our goals, but we have to ensure that the local communities, as you have mentioned, Mr. Chair, make sure that our local communities don't suffer any potential negative environmental effects and that they receive the positive economic benefit. And I absolutely appreciate the trust program that was initiated from the very beginning to protect the community and protect the community's economic benefit from this project. As always, I look forward to the testimony that will be presented. Thank you.

Mr. Connolly.

Thank you, Chair. I wanted to thank you for convening this hearing and also within the last several months, actually bringing a group of us down to Lithium Valley to check it out firsthand. It was aye opening. I was also very happy to see the Salton Sea for the first time at kind of a bucket list event as well.

What it underscored, though, is this is a unique opportunity to meet some of our goals around how are we going to get toward 100% zero emission vehicles by 2035, how are we going to meet our climate objectives by 2030 and 2045? That having been said, seeing it firsthand really underscored the environmental sensitivity and beauty in that area.

That certainly has to stay utmost in our minds as we undertake challenges and opportunities around this topic and the various communities, many of which have been traditionally underserved in the Coachella Valley and Environs and how they have to be front and center at the table, including our tribes. So with that, I also appreciate the work of the commission that put together this report and very much look forward to the hearing today as well.

Thank you. Mr. Connolly, any other comments from any of our colleagues? Okay, seeing none, I'll ask all of the individuals who will be providing testimony and or to please come forward at this time. We will follow the agenda as set up, starting with Ms. Sylvia Paz, who served as the chair of Lithium Valley, followed by Steven Boyd, representing Critical Minerals Office for the Department of Energy. We do have Ms. Noemi Gallardo here in person.

As well, supervisor Ryan Kelley from Imperial County, who will undoubtedly remind us that Lithium Valley is Imperial Valley. And we have followed there Mr. Olmedo, the Executive Director of Comite Civico, followed by Alicia Knapp, CEO of Berkshire Hathaway Energy. And last but not least, Vince, who will be representing Energy Source Minerals. So welcome, everyone, and we'll begin when you're ready with your testimony. We will reserve questions at the end of the last person who testifies. Thank you.

Good afternoon. Thank you, Chair Garcia. I am Sylvia Paz. I am the founder and Executive Director of Alianza Coachella Valley, and I also had the distinct pleasure of being the chair for the Lithium Valley Commission today. I'm going to formally be presenting some of the findings that are in the report and uplifting the highlights that were important for the people at the local level.

But before I do that, I do want to start by answering one question that kept coming up during our Lithium Valley Commission meetings, and that was whether the Commission would take a yes or no position on lithium. Advancing that was not the intent of the Lithium Valley Commission, and that is very clear when you look at the timeline of what preceded the establishment of the Commission before the Commission was established.

Going back as far as 2015 or earlier, there's been interest from the state and others to explore the extraction of lithium at the Salton Sea geothermal Resource area. Since 2018, the California Energy Commission held meetings on the topic and made significant investments in research and development. And in 2020, there was legislative and budget actions to develop a Lithium Valley vision. With this timeline, the state identified lithium as a key component to achieve California's clean energy future.

The federal government identified lithium as critical for national security, and many have seen the opportunity with potential to unleash billions of dollars of new economic infrastructure development in California. And then came AB 1657, and the Commission was effective January 2021. It was composed of 14 representatives across local community groups, environmental justice groups, government tribes, and industry. And we were tasked to review, investigate, analyze the specific topics relating to lithium extraction in California and submit a report to the Legislature documenting its findings and recommendations.

The report was submitted December of 2022, after analyzing and discussing each of the topics over the course of over 23 public meetings, hearing from experts including academics, industry, government tribes, and community residents. Within this context, then, the report offers the Legislature a range of issues to consider as the state pursues this endeavor, and 15 recommendations to address the challenges noted by industry, tribes, local government, and communities.

So, for the interest of time, I will offer three key highlights from the report, as I know that the other panelists will be able to tell you the status of many of the projects since the submission of the report. So takeaway number one as Chairman Garcia mentioned, and I think Vice Chair Brian Kelly will agree. Lithium Valley equals Imperial Valley. Why is this important?

Well, the conversations about lithium and a Lithium Valley vision started before the Lithium Valley Commission was established to describe a world class lithium industry in California centered on the recovery of lithium from geothermal brine in the Salton Sea region. It became very important to establish that to do this the right way, it needed to be centered in the communities in Imperial County.

So the recommendations that the report makes really focuses on preparing the region to be able to create an industry of this magnitude that goes beyond the extraction of lithium only. So some of the recommendations include accelerating transmission planning and buildout in the Imperial Irrigation District service area, targeted investments in infrastructure from roads to broadband to power poles, to support and incentivize economic growth and planning for the colocation of lithium supply chain components,

which will help this region capture the economic benefits of this new industry and not let it become solely an extractive economy in Imperial Valley. Key takeaway number two is to recognize the Salton Sea region as one of California's economic regions.

Currently the California Economic Development Agency talks about 13 economic regions in the state and it separates the Salton Sea region, which we see as being inclusive of Imperial Valley, Palo Verde Valley and the Coachella Valley, into two regions, one of them in the Inland Empire region, the other one in the Southern Border region.

We have seen that when this happens, it becomes very difficult for the Salton Sea communities and the communities that are surrounded by the lithium development projects from addressing the environmental, economic and social issues that are impacting their communities. These issues are very different from the regions in which they are currently paired, so they get diluted.

So the recommendations in the report do talk about establishing the Southeast California Economic Zone that would include again the Coachella Valley, Imperial Valley and Palo Verde Valley, and it also spent some time discussing needed investments to enhance education and workforce development, particularly in STEM and green jobs for the people who already live in this region. And key takeaway number three is the attempt and desire to reduce, mitigate and eliminate risk for industry.

This comes in the form of an expedient and clear permitting process for the environment, a clear understanding of what the buildout of a lithium industry will mean for higher traffic and associated air pollution, as well as water use and quality. And there are several efforts to help us do this and the county, Imperial County for example, is going through the programmatic EIR which will hopefully help us understand a more cumulative impact versus seeing it project by project, and there is also some ongoing research under the Lawrence Berkeley Lab.

For the community, reducing and mitigating or eliminating risk comes in the form of a guaranteed community and economic benefits, whether that is local workforce agreements, community benefit agreements or other, and also protection of health. So while I did mention two efforts that will give us an idea of what the environmental impacts could be, we would still need to translate what these potential impacts mean to public health.

So to conclude, it's been worthwhile for me to be able to think of the various aspects associated with the development of a lithium industry centered in equity, and I am happy to present these for your ongoing consideration as the state pursues a clean energy future. Thank you.

Thank you very much, and thank you so much for serving on the Commission as the chair. We really appreciate the volumes of community perspective that was brought to the table. And so if we haven't said it before, we're saying it publicly. Thank you again, we want to move on to the next presenter who will be doing so remotely. Steven Boyd is the acting deputy Director for Batteries and Critical Minerals in the Office of Manufacturing and Energy supply chains for the Department of Energy. So whenever you're ready.

Okay, thank you very much, everyone. It's a pleasure to be invited here. I'll keep my remarks brief, but I do want to say that I think it's important to represent DOE's interests here in our Office of Manufacturing Energy Supply Chains. We're strengthening and securing manufacturing and energy supply chains needed to modernize the nation's infrastructure and support a clean and equitable energy transition for our country.

We're also interested in catalyzing the development of an energy sector industrial base through targeted investments that establish and secure domestic clean energy supply chains and manufacturing. DOE appreciates the report mentioned here of the Blue ribbon commission on lithium extraction in California. We've read and fully digested this report, and we've certainly leveraged this as well in terms of our analysis of sort of strategic resources across the country, and in particular the importance of lithium in this region, providing that to batteries.

And I'll just underline we really appreciate the potential importance of lithium supply that this region could provide. We put together a team from our office and from actually other federal agencies as well. And we did visit the area, along with some support from folks here and we very much appreciate the time we spent with folks getting to know the area and better understanding the importance of this region and how it can provide a supply of lithium as well as other minerals and materials, and how that's important both in terms of impacts for batteries as well as locally and strategically to our country.

DOE is very interested in providing these sort of battery supply chains, in particular for lithium, for lithium ion and lithium metal type spec batteries. This has been, I think, well recognized in terms of our work with the Federal Consortium on Advanced Batteries, which DOE leads, but also has participation from 18 other federal agencies, including those in DoD, EPA, and the Department of Transportation.

I also want to point folks, to some of the work that has been released from the DOE-led federal consortium on advanced batteries, including the national blueprint for lithium batteries, which underscores some of our goals and priorities in terms of building out the supply chains for lithium batteries and how those could affect not only things like electric vehicles and clean energy, but also help to provide for strategic importance in other areas that the government would like to support.

I'll finally just want to highlight that DOE continues to provide funding for building out supply chains for battery materials, including lithium. We've executed a one round of funding from the Bipartisan infrastructure law under Section 40207 for battery materials processing as well as battery manufacturing.

And we have plans to continue executing on those sections of the Bill in terms of providing future funding opportunities for the supply of materials that can help us meet our goals that we set out in those reports I mentioned, as well as the sort of strategic importance of supply chains that we continue to work on and will continue to work on. So thank you very much again for the opportunity, and I'll be here for the panel.

Thank you very much. We'll move on to our next presenter. That's Noemi Gallardo, the lead commissioner for Lithium Valley for the California Energy Commission.

Buenos tardes. Good afternoon, Chair Garcia, and honorable Members of the committee. Really excited to be here. This is my first hearing as a commissioner. I am Noemi Gallardo, I am the newest commissioner at the Energy Commission, also because I know you value diversity and inclusion. I'm the first Latina Commissioner, and even though I'm new, I already have a very robust policy portfolio. One of the priority areas is the lithium valley vision.

It's a priority for me because of the community, and it's a priority for the Energy Commission, and we do see it as vital to achieving our mission of leading the state to an 100% clean energy future. We were also very excited because of it being a priority to support the Lithium Valley Commission. It was a pleasure to meet all of the commissioners, worked very closely with them, did visits with them, and am looking forward to continuing to work with this great group of people.

So I'm here to provide updates from the Energy Commission perspective, and I did do a PowerPoint which I believe is behind me. Great. And one of the first updates I wanted to tell you about is I was finally able to secure Chief of Staff, and he was really worth waiting for. He has 15 years of experience working at the Energy Commission in our Research and Development division, which I think will be very valuable for our Lithium Valley work. His name is Eric Stokes.

He's here with me today in the first row, ready to answer some questions in case we get into the weeds of the type of information he'll have access to. And he will be the lead advisor for me on Lithium Valley. So we'll go to the next slide, just focusing on the role of the Energy Commission in the Lithium Valley Vision. I summarized it here in really four areas of action, which is to convene partners, invest resources, attract support, and localize benefits.

I'll go into each of these. We just wanted to kind of summarize it, and it's not a marketing campaign, so there's no clever acronym or anything there. So on the next slide, I'm focused here on convening our state partners. We have been doing a lot of engagement since before the Lithium Valley Commission and during the Lithium Valley Commission, and basically it's been more one on one check ins and just seeing what each other is doing in terms of the state agencies.

We've done joint visits to the Salton Sea area. I'm part of a Salton Sea Coordination group with the CNRA and all of its departments that's mostly focused on ensuring we're not overburdening the community when we're doing our engagement out there. So we talk a lot about that. We've been working closely with GO-Biz. We put together, for example, a Critical Minerals in California conference back in January and also helped support the Governor's visit in April. So doing a lot of work there.

But what I think is missing is the convening and consistent communication of the state partners. And so that's an area where we think Energy Commission can play a role as convener, having monthly meetings so that we could better organize our work. We can coordinate that engagement. We can align resources, decipher which of the recommendations that the Lithium Valley Commission put out, we can each take on. Because the Energy Commission can't do it alone.

And our partners in the state agencies have been incredibly valuable, and we see them being vital, moving forward, removing any barriers that come up. So some of the agencies are working more directly, like we are. GO-Biz is an example, and there are other agencies that are more indirect, but also affecting the Lithium Valley efforts. So we're thinking of inviting all of them and figuring out which meet monthly and which come in as needed.

Also we noticed in the Lithium Valley Commission's report is recommendations about how we communicate with the community, with the tribes, with those that will be affected as we're doing our work. So I'm thinking that this convening of state partners can also help us with a communications campaign, a better way to be able to get the information to the people, and potentially a sequa primer.

A lot of the agencies like CEC are lead agencies on sequa, so we have a lot of insight and potentially can do some type of primer for communities and tribes. On the next slide, you will see the focus on attracting additional support. So this is beyond what the state partners can do. A lot of it focused on our federal partners.

So we did coordinate a visit for the Department of Energy and Department of Defense in April to come get to know the Lithium Valley and for them to realize how great it is, what the opportunities are, meet the people. So that was very effective. I'm also already engaging with the Department of Defense, office of Local Defense Community Corporation. They have a lot of grants in the millions and some of them are competitive and others are just.

If we have a great idea and it will impact the community that they have military community living in the area which in Imperial Valley there is, they will be able to Fund. So we need to talk about what that could look like but that's a huge opportunity there that I think Energy Commission, based on our relationships that we have with military, can do.

And then in terms of next steps, what I'm thinking is of putting on a Lithium Valley symposium in the Imperial area, where we can do something similar to the Epic symposium, where we invite state partners, federal partners, companies, enterprises, anyone who wants to come and figure out how can we better work together, what opportunities are there so we can do that. We can address infrastructure gaps, workforce needs, other critical mineral possibilities, and whatever else may come about. So we don't have this fully fleshed out.

It's just an idea that we have about what we can do. On the next slide is our focus on localizing benefits for resident shareholders. So, Chair Garcia, you have brought up this idea of the residents being our shareholders, and we should really be focusing on targeting benefits to them and what they need, what they want. And I really love that idea. And so I want to work more closely with you and the group here to figure out what that looks like.

But what we've been doing in the meantime is having all of our commissioners at the Energy Commission do visits. There's one commissioner left of us, five who hasn't visited, but we're planning already an engagement for him to attend in a couple of weeks. So all five of us will have been there by the end of the year.

We've been doing check ins with the different organizations, some of them represented here, and we've done a whole array of other events and attended to get to know the community better. And so for next steps, we are planning a visit to get to know the mayors and the city managers of all of the cities that form the Imperial Valley. So we really get the opportunity to talk to them directly about what they're prioritizing and what all of this looks like from their perspective.

We're also thinking about having a Lithium Valley section in the next IPER, the Integrated Energy Policy Report, which is one of our most critical pieces, and then also figuring out if there are any researched and development opportunities to think about water technology, because we know that that was one of the most important items for the community. And then health studies as well, because we also know, as Chair Paz mentioned, that health is a major aspect.

And then finally in the next slide is investing resources to promote. California Energy Commission has invested a lot, over 270,000,000. We also have a grant program called Gerda, the Geothermal Grant and Loan Program, which is another opportunity.

But aside from that, I think we need to do a better job of centralizing all of the resources that the state agencies have available and the services that we provide to be able to attract more businesses to the Lithium Valley, including for colocation and other types of support, and also keeping the businesses we have too, because they'll be more excited about what's going on in the Lithium Valley and also gain confidence about what's happening.

And so a few of the ideas that we have is trying to figure out if our new opt in permitting process that was established by Assembly Bill 205 makes sense for the work that's being done on lithium in general, developing a dashboard to be able to easily display the investments and the progress we're making.

So monetarily and also on the Lithium Valley Commission recommendations, and then also just putting together, like I said, that package for attracting other companies, developers, businesses, et cetera, that could play a role in Lithium Valley. So potentially a one pager for them doing the dashboard that we display on a website, things of that sort, that just make it really easy for folks to know what's going on, what we're doing.

And then on the next slide, there's a list of the various benefits and resources and investments that the state agencies have made. There's a lot, and I'm not going to go through them all. But just to give you an idea of what we can put together is what I'm calling right now, a package about Lithium Valley and why it's great and we can promote that. So I'll end there. Thank you so much.

Thank you. Thank you. I'm sure there'll be some questions for yourself and chair once we complete. Supervisor, floor is yours.

We thank Chair Garcia for convening this and giving us an opportunity and all the Members present for allowing us to give you an update of where we've come. Since the commission's recommendations, where we were, as we built during the commission's conversation, we've always seen the Salton Sea as an opportunity and not a burden. And as we are talking today, that is the condition that we find ourselves.

The Salton Sea is going to be something that pays dividends not just to the people of Imperial Valley, but also to the state of California and the nation. Next slide. So, Imperial County is kind of unique that we've been experiencing renewable energy for quite a long time. Geothermal established in the late seventy s, and continuing to operate and provide baseload power in California and outside of California. But we've also seen wind and solar develop in Imperial County.

And what we learned when solar became very attractive and promoted was that we were not ready specifically for it. So as it happened, it ended up being placed on disturbed land, agricultural land. And to date, we have about 16,000 acres of acreage that was farming, that is now in solar farm, that displaced jobs, it displaced water. And we've also seen other concerns about how water is being used on the lower Colorado River.

So in 2015, the California Energy Commission awarded money to Imperial County to do an energy overlay, including geothermal, but also solar. And we were very thankful for that funding that allowed us to be able to target where we wanted to see solar happen, not excluding individual property rights, but saying that it would be easier for you to permit if you went to an area that was not in production, that was outside of the service area, and that you went into a specific planned location.

And so that has been, that was a successful update to our General plan. And that's where we are today. We've seen most of the new solar now going into areas that haven't been farmed for over 20 years or into open land. But we have also seen over these years, the past four decades, that geothermal has been a very good neighbor of agricultural production in Imperial County. And we see that continuing as mineral extraction happens. Next slide. So now we're here as a comeback, right?

The renewable portfolio, it mentioned geothermal, but didn't recognize geothermal. And after years of advocating at least a decade or more in my lifetime, we've been in these halls, we've been in Washington, we've spoken with departments, agencies, legislators to bring Geothermal's attention into focus for policy or implementation. And today we are here.

And the biggest shift that has occurred was the Public Utility Commission's 2021 conversation about an integrated Resource plan when Geothermal became part of a prescribed mandate of power purchase for the IOUs and the municipals that made the game for mineral extraction much more attractive. And I believe that is the key of why we're here talking about these conditions today.

So I applaud that decision and other decisions, but these policies are making the possibility of seeing a huge economic benefit for our area and the state of California. So where have we been? Well, there was also a huge piece of legislation that was signed last year. Senate Bill 125, with the assistance of Assembly Member Garcia and our State Senator Ben Weiso, signed by the Governor, created an avenue for us to be in a planning for what could and we hope happens.

So funding for a specific plan and programmatic Eir was included in that and I can tell you today that that has already started and we are almost in the twelveTH month of that study. We also were awarded funds to have community engagement. We've awarded five grants to community based organizations to be doing outreach related to the specific plan and programmatic Eir.

We've also initiated a Health Impact Analysis through or in partnership with San Diego State University that is looking at what the cumulative impacts of what we know Lithium Valley will be producing. We also have a workforce and Education Needs assessment that was funded by the Department of Labor that is taking a look at the long term needs of our education building and workforce delivery for new industry in Imperial Valley.

And then we have a severance tax that was included in SB 125, 20% of that goes to the Salton Sea operations and Maintenance of projects, 80% to Imperial County. And we have agreed in framework to share that with the local jurisdictions, the cities and towns of Imperial County, but most importantly to invest in Lithium Valley because if you've visited, as Mr. Conley mentioned, it is a greenfield space.

We have bridges that need to be repaired, we have roads that need to be paved, we have broadband, and we need to encourage this industry to locate, develop and spawn more and attract more of this industrial manufacturing base. So in reference to the severance tax, we have initiated a 60 day comment period that's concluded, but we extended it. And today you can still make your own comment where priorities should be.

And we are hoping to have a stakeholder meeting this fall where we're going to invite community leaders from across the county, NGOs, cities, agencies to come together, including our representatives as well, to be able to talk about where those priorities should be set. And we'd like to memorialize that. But to be clear, there is no money generated today. So this is something that we are building upon and trying to establish prior to that day. The next slide, please.

So we have taken the initiative of also incentivizing Lithium Valley, and we are utilizing the program in California, the Capital Investment Incentive Program that caps property tax at an investment of over 400 million. Each of the companies are aware of this. We've also offered a rebate to the producers of the mineral and to those that want to manufacture with that resource in Imperial County.

So this only applies to if you are taking lithium from Imperial Valley and selling to a manufacturer in Imperial County that is producing a product in Imperial County. We are also engaged in talking with manufacturing companies. We attended the Fast Markets Conference in Henderson, Nevada, in coordination with GoBiz as well as labor and industry to bring more attention to Lithium Valley. Lithium Valley is a good moniker to describe who we are.

But as we found out from the industry and those that are in the mining sector, everyone knows this resource as the Salt and Sea Geothermal Resource Area. And so we're helping them. And we're not to be confused with Lithium Valley and Brazil. We are also working at streamlining our permitting process. So, as we mentioned, we are doing a specific plan and programmatic eir.

At the end of that, we are talking with manufacturers and suppliers that are willing to co locate into Lithium Valley so that we can identify them and have them included in our analysis. So at the end of the day, they would be able to come to us having a complete environmental review. And if not, those hazards that we know and have already studied could be built off of. For their own environmental impact report. We've established a Lithium Valley office within our Administration.

This is a liaison between government and industry. We are trying not to have any of the loss information to make sure that these things get responded to and that queries are not left out in the ether. And then we are also developing an enhanced infrastructure finance district around the Salton Sea. This would be a tax increment of increased property values that would be used in the area around 3 miles from the shoreline. The shoreline today, as the shoreline is receding every day. Next slide.

So, the Lithium Valley specific plan and programmatic eir, the known geothermal resource area is 111,000 acres. We are taking on a size of 51,000 acres, about the size of the city of Oakland, and that is the overall impact area and that is where the resources are being developed and used today. But then even more focused is the 10,000 to 12,000 acres where we are doing the application of the programmatic eir.

And that is where the footprint today of all three of the geothermal sites from the companies you'll hear are at. So we are in their region and where they are developing. Next slide. So our plan is going to take in an overlay, over lands that are private and publicly held and to dispel any rumors. I'm sure you may have heard it. I've certainly heard it. We are not intentionally drying up the salt and sea to create a resource for the United States of America.

This is a condition that happened from a water transfer and that the resource has always been there and it is well below the salton sea. But I do applaud Energy Source Controlled Thermal Resources and Berkshire Hathaway Renewable for developing the salton sea known geothermal resource area and incorporating mineral extraction into their projects. And we thank Eduardo Garcia, Ben Weso, Karen Douglas, Gail Miller, Lawrence Sanchez, Wade Crowfoot, Governor Newsom, among others, for recognizing the resource in Imperial County and partnering with us.

And I would be remiss of not saying noemi gallardo as well, but California policies created a shift to decarbonize the energy and transportation sectors. And Members, you need to know that we must work together to ensure that California energy, California minerals, California manufacturers equates to California jobs. I have a niece that lives in Amarillo, Texas. She drives a F 350 diesel. She is not going to buy an electric vehicle. I have had these conversations with her.

But electric vehicles that are made in Texas and sold in California doesn't pay the dividend of these policies and this development. So we are watching what is happening. We are talking to these companies. Their choices are being made today. West Virginia, Michigan, South Carolina, Georgia, Texas, Nevada, Arizona. They are making strong sale pitches to have these industries, these manufacturers locate. The onshoring is happening today and we definitely need to get our stuff together.

So I thank you for this opportunity to speak and I'm available for any questions that you may have. Thank you.

Thank you, supervisor. We'll move on to the next presenter. That's Mr. Luis olmedo.

Good afternoon, Chairman Garcia and Members of the committee. My name is Luis Almedo and I'm the Executive Director of Comitesivico Del Valites, a 501 C three organization, community based environmental justice organization that lives in the disadvantaged communities of Imperial Valley. Otherwise known as Lithium Valley, comites Civico is founded on the principle that inform people, build healthy community. We do this by informing, educating, and engaging Imperial Valley residents in civic engagement venues focused on water quality, air pollution, energy clean transportation, public health, and farm worker rights.

Comite CICO Del Valley is one of many local impact organizations that have been working tirelessly over the past two years to ensure that the full scale extraction process of our region's geothermal energy lithium mineral recovery industry are developed, sustainably and inequitably throughout our region's history. Our local government, residents and community based organizations have been lured by various industries with the promise of economic salvation and community benefits in exchange for community and political support for their projects.

Unfortunately, the overwhelming majority of these promises have fallen short and either the projects or the community benefits fail to materialize. These types of outcomes can prove to be demoralizing and fosters a culture of suspicion anytime a new industry parachutes into Imperial County, asserting to be the next economic savior of our community.

Further, Imperial County's water transportation, broadband housing, public health system are in significant need of infrastructure improvements not only for emerging lithium industry, but also for the day to day needs of the people living and working in Imperial County. I would be remiss if I also did not elaborate on the public health and environmental risks that are constantly confronted in the region.

Water quality challenges stemming from poor drinking water to the shrinking salt and sea air pollution from local agricultural practices, international goods movement stemming from the California Mexico border are constant struggles regarding the future of lithium extraction. Comitesivico El Valley is concerned with potential waste from the mineral resource recovery process and potential impacts to the local water quality. While historic and current concerns are real, Comiteco ElValle understands that there is an opportunity to make lithium development in Imperial Valley the cleanest and the safest in the world.

But in order to do so, it will be important that the industry, workers, community and government come together around a set of values that protects the health and our local residents, ensures environmental integrity, and encourages high road education, training and workforce development. In the spirit of Comite Civico Del Valle has been working in coalition with labor unions, environmental justice, regional nonprofit organizations under the banner of Lithium Valley Community Coalition for the purposes of coordinating our participation in Imperial County's lithium planning permitting community outreach processes.

Frankly, the technical, policy and legal implications are overwhelming and we are doing all we can to keep in place and we are actively soliciting academic expertise to assist. The Lithium Valley Community Coalition collaboration and partnerships are currently focused in Imperial County's Programmatic Environmental Impact Report, which will provide local government and Members of the public with the detailed information about potential environmental impacts, possible ways to minimize those impacts, and offer alternatives that would reduce and avoid identified impacts.

The coalition also engaged in regional economic development planning under the State's Community Economic Resilience Fund, otherwise known as SERP, created to promote a sustainable and equitable economic recovery from economic distress of COVID-19 by supporting new plans and strategies to diversify the local economy. In solidarity with our labor unions, we are also participating in the California Workforce Development Board's High Road Training Partnerships, or Hrtp, to foster clean energy industry partnerships to deliver equity, sustainability and family supporting quality jobs.

Our coalition plans to leverage these lithium development planning, economic and workforce development processes to outreach recruit encourage enrollment in Imperial Valley's Community College Lithium Workforce Training curriculums. On the policy front committes sponsoring Assembly Member Garcia's AB 1562, which seeks to legislate a recommendation from the Lithium Valley Commission's report to establish a Southeast California desert valleys economic zone to include Imperial County and Eastern Coachella and Palo Verde valleys.

Policy goals for the zone include tariff relief credits or incentives for corporate investments, credits for education, investment in local workforce and childcare research, development, community benefits, project, labor and maintenance agreements, in addition to the integration of the state certified apprenticeship and the pre apprenticeship opportunities.

Imperial county currently faces 17% unemployment rate and 22% of its residents live below the poverty line, a number that doubled the National Average Committee believes that equitable implementation of these programs will go a long way to reduce local unemployment rates while increasing community and individual wealth. The challenges? Well, while we are optimistic about these opportunities might offer, there are challenges that these activities may have the full ability to address. One of these challenges is the lack of electric vehicle charging infrastructure in the Imperial Valley.

We have the least amount of chargers per capita in comparison to the rest state of California. According to California Energy Commission, comite Civicol Valvalle is the only nonprofit organization in the state of California that is actively constructing, maintaining a local, community owned charging station infrastructure that intends to keep the money that is invested from California. In California, in our communities to build the resilience and the equity and the justice that the Legislature and that the Administration has promised us.

A significant barrier in accomplishing this goal is the CEC's requirement that a certain amount of capital investment be committed as a prerequisite in order to be eligible for the public EV charging station incentive dollars. Comite Civic Alvarez has met with the CEC to communicate a desire for program flexibility, our unique market position, and have offered reforms to ensure that the EV charging station development opportunity are equitable and accessible to all.

It would be unfortunate if Imperial Valley has the least amount of access to EV chargers, yet we may be producing the country's largest supply of lithium, a product that then we would not, a consumer product that we would not be able to access.

In addition to the programmatic gaps in the state's EV charging station programs, we are also concerned about the efforts to repeal the legislature's lithium tax excise tax in SB 125 that Supervisor Kelly had mentioned that was passed as part of last year's budget that took an enormous lift. We thank you, Legislature, for passing that, but it is now being threatened and those community benefits that are now at least legislated in statute and would be guaranteed that some of the industry opposed. Not all.

But we appreciate those who just did not show opposition to that tax and want to be fair in investing in our communities. Now it's being threatened. Earlier this year, the Imperial County Board of Supervisors voted to oppose the Taxpayer Protection and Government Accountability Act, a statewide initiative sponsored by the California Business Roundtable CBRT.

This initiative would amend California constitution to restrict the ability of the state, local governments and electorate to approve and collect taxes and fees by retroactively canceling recently passed revenues measures and invalidating all state and local measures passed after January 1, 2022. This puts SB 125 excise tax in enormous risk and it would take any incentive, I mean, we're already a poorly invested community. Supervisor Kelly, good job mentioning all that.

We hope that if passed, this measure would invalidate the state's lithium extraction excise tax, which I'm sure may be very promising for some in the industry, like I said, while others have been fully supportive of community investments. Will be passed in January 22, which guarantees Imperial County receives, while the excess tax will guarantee 80% of the monies will go back to the Imperial Valley.

Through incentives on behalf of Imperial Valley's disadvantaged communities, we urge the Legislature and the Governor to exert political capital to ensure that this initiative does not pass and that committed community investments not be undermined. So, in conclusion, I'd like to thank Assembly Member Edo Garcia for his leadership and for the opportunity to share frontline community perspective. And I look forward to answering any questions. Thank you, Members of the committee.

Thank you, Mr. Romero. We'll go on to our next presenter, Alicia with the President and CEO of BHE Renewables. Welcome.

Thank you, Mr. Chair, and good afternoon situated. My name is Alicia Knapp, and I'm the President and CEO of BHE Renewables. I'm happy to be here today in front of this committee to provide an update on our company's lithium and geothermal development projects in Imperial County. BHE Renewables is a wholly owned subsidiary of Berkshire Hathaway Energy, and develops, owns and operates solar, wind, geothermal and hydroelectric projects across the United States with a total combined generation capacity of just under 5200 MW.

Through our subsidiary, Cal Energy Operating Corporation, we have owned and operated ten geothermal plants adjacent to the Salton Sea in Imperial County for over 40 years. Our plants have a total production capacity of 345. We're currently evaluating the opportunity to expand our operations with three new geothermal plants that could double the capacity by 2028. Our plants currently process about 50,000 gallons per minute of geothermal Brine, which comes out of the Earth at approximately 500 degrees Fahrenheit.

We use the heat from the Brine to produce geothermal energy and then return the Brine to the geothermal reservoir. Approximately 75% of the Brine is water and the other 25% is dissolved minerals and solids, such as and salts, such as manganese, zinc, silica, iron, calcium, and of course, lithium. In fact, the geothermal reservoir we've been using to produce clean baseload energy in Imperial County for decades is also one of the largest lithium deposits in the world.

As we know well, world demand for lithium is expected to grow as much as tenfold in the next decade, and will be critical for the success of the clean energy transition. Today, very little lithium is produced in the US. Nearly all global supply is mined in Argentina, Chile, China, and Australia and involves processes that cause significant environmental impacts, but we may be able to change this.

The reservoir we're already using to produce geothermal energy presents a unique opportunity for us to secure a domestic supply of lithium in an environmentally friendly manner. Studies estimate the geothermal reservoir in Imperial County can produce more than 600,000 tons of lithium carbonate per year and last approximately 40 years. Recognizing this opportunity, BHE Renewables has been developing technology to commercially recover lithium from our geothermal Brine.

In May of 2020, BHE Renewables earned a $6 million matching grant from the California Energy Commission to design and build a one 10th commercial scale demonstration project to recover lithium chloride at one of our geothermal power facilities. BHE Renewables matched this grant and contributed additional corporate funds and commissioned the Lithium Recovery Demonstration Facility in June of last year. We're partnering with UC Riverside, Lawrence, Berkeley National Laboratory, and the center for Energy Efficiency and Renewable Technologies to assist with knowledge transfer and technical chemical work.

We also have plans to build a second commercial scale demonstration project to convert the lithium chloride into battery grade lithium carbonate. It's important to note that the technology to recover lithium from Imperial Valley Geothermal Brine in an economically viable and an environmentally responsible way is yet to be proven on a commercial scale. We're moving forward in incremental steps to increase the likelihood of success. We're currently testing direct lithium extraction technology on Brine source directly from our operating geothermal plants.

Pending the successful completion of our tests, the first commercial plant could begin construction as early as 2024, and commercial operations could begin as early as 2026. As mentioned earlier, we're currently developing projects which would double our geothermal output from 345 to around 700 MW, as well as double our lithium rich Brine flow. The expansion includes three new geothermal plants which, if successfully developed, could also include lithium production. Doubling our geothermal power output may roughly double the opportunity for lithium recovery.

Our geothermal projects are undergoing their permitting process with the California Energy Commission, and we're working to secure offtake agreements for the projects. Additionally, to support clean baseload energy from our geothermal projects and others, BHE Renewables and Imperial Irrigation District are pursuing major transmission upgrades to deliver the additional clean baseload energy California needs. This line will allow our company and other potential clean renewable power projects to supply over 1000 renewable baseload power to Californians across the state.

BHE Renewables is committed to benefiting the communities in which we operate, and Imperial Valley is no exception. The company's current geothermal facilities employ 230 people. The lithium development and geothermal expansion projects could each create approximately 200 new permanent jobs. This is on top of the significant tax impacts the projects will have for Imperial County and the thousands of construction jobs associated with the projects.

Recognizing that specific technical skills are required for both lithium and geothermal plant operations, BHE Renewables has partnered with Imperial Valley College to develop three new certification programs to equip local residents with the necessary skills for these jobs. We also have active partnerships with workforce development organizations such as the Imperial Valley Economic Development Corporation, imperial Valley Regional Chamber of Commerce, Sultan Sea Authority, Rotary Club, imperial Coalition of Labor, Agriculture, and Business, and Geothermal.

Rising with both projects, however, there are challenges that BHE Renewables is working to overcome, such as construction costs, schedule delays, workforce development and housing constraints. The community also needs significant infrastructure repairs and upgrades to support commercial developments, including bridges, roads, and broadband access. And some of that work has already begun.

We're working diligently with local communities and stakeholders to listen to their concerns and educate them on the benefits of the projects, notably, that lithium production will not create significant adverse impacts on air quality and will not encroach on the Salton Sea. The Lithium Valley Commission has played an important role in these efforts to overcome challenges and contribute to the success of lithium development in the Imperial Valley, particularly for the local community.

Through its 23 public meetings, it did an excellent job identifying key issues related to California's lithium economy and providing recommendations which are outlined in its December 2022 report. Berkshire Hathaway Energy was honored to serve on the Commission and supports its recommendations to conclude lithium development in Imperial County could be transformative for the local community and the state of California, and could provide a tremendous benefit in the form of a clean domestic source of lithium for the nation.

BHU Renewables is excited to build on our 40 year history in the region by developing geothermal and lithium projects that will play a critical role in California's clean energy future. Thank you again, Chair Garcia, for convening this hearing and inviting me to participate, and I look forward to your questions.

Thank you very much. We'll go to our final witness vince Sign with Energy Resource Minerals. I hope I said that right.

You did. Thank you. Thank you, Chairman Garcia. And Members. It's a pleasure to be here. I'm Ben Senorati. I'm the vice President for Government relations for Energy Source Minerals. So, to begin with, the photograph that you're seeing on the screen is the John L. Featherstone Geothermal Power Plant. It is the newest of the eleven plants constructed at the Salton Sea. It went into commercial operation in March of 2012. So we're in our 11th year of commercial operation. So, next slide, please.

So you can see we've got a white star near the Salton Sea. That's the area where we will be developing our project. And you've got other stars scattered around North America, South America, and Europe that show lithium resources. Lithium is plentiful in the world. It has not been developed to its full potential, but there is plenty of lithium to supply our EV needs. Next slide again. Our project is located on the southeastern shoreline of the Salton Sea.

You can see 450,000 acres of irrigated farmland in Imperial County. Next slide. So we call our project Project Atlas. And I want to distinguish between Project Atlas, which is our 20,000 tons of lithium hydroxide monohydrate at the Salton Sea, from our technology that we call Iliad. So next slide. So you probably mostly know this, but at the Salton Sea, and as Ryan mentioned, there is a somewhat common misconception that lithium production is coming from the Salton Sea rather than a couple miles below the ground.

But we take superheated fluid from a deep reservoir, we bring that fluid to the surface. We rapidly vaporize it in a series of vessels, creating steam. Steam is cleaned and then used to drive a turbine. The Brine is processed and injected back into the ground. So that is the current saltency methodology. Next slide, please. So that is going to continue essentially unabated.

However, before the geothermal Brine is injected back into the ground, it will be diverted to a plant, our Project Atlas, which will be co located with a John L. Featherstone plant. That is where we will use our patented proprietary technology that we call Iliad, to preferentially harvest the lithium from the Brine. Next slide, please. From our plant, our product will go directly to a battery manufacturer. Our goal is to produce battery spec lithium from our Project Atlas. Next slide.

Once the Brine is processed through Project Atlas, it will be returned to the power plant and injected back into the subsurface reservoir. So the entire process will continue to be a closed loop system. Next slide, please.

So, we believe that Project Atlis will be the cleanest, most environmentally responsible lithium production on the planet. You can see, our water consumption is significantly less than any other technology. Our CO2 is significantly less than any other technology. And most of the CO2 that we will be producing, will be from vehicle traffic. So that's where the CO2 comes from. And then our land footprint is, perhaps, most significant. You can see the large blue circle; that represents 3100 acres of South American salares.

And we are going to produce the equivalent of what is produced on 3100 acres, on 40 acres. So, very small footprint. Next slide, please. So, what you see here, is not the brine that comes out of the ground. This is processed geothermal fluid. The brine, as it comes out of the ground, is essentially brown, because it has so many elements on the periodic table, in the brine. So, we clean that and deliver a much cleaner brine to our ILiAD technology. Next slide, please.

So, instead of having brine in South American salares or hard rock mining in Western Australia, we have brine that is going to stay on our site for about 12 hours. And when you compare that to South American salares, it could be anywhere from twelve to 18 months to produce an equivalent amount of lithium. We also recover over 90 percent, again, compared to about 40 percent in South America.

We will be utilizing some of the steam, some of the excess steam from the featherstone plant, as well as electricity that's actually generated from the featherstone plant. We're not weather dependent, and as I already mentioned, it is a closed loop system. Next slide, please. I think this is my last slide, and so, I want to just tell you that this is going to generate a huge amount of revenue for Imperial County.

$720 million over the life of the project, $96 million of which will go to Salton Sea restoration efforts. Our project alone will generate over 220 new full time jobs, approximately $18 million in payroll and services per year, $24 million per year in taxes, and about $2.5 million dollars in infrastructure improvements. So it's a project that we think is going to be very good for the county.

And speaking of the county, we work very closely with the Workforce Development Board, and as Alicia mentioned, we have been working very closely with the local community college, Imperial Valley College. They commissioned their first of three certificate programs this semester, and last night was the first class. There was an orientation held a week ago -- I attended -- and there were over 60 new students in attendance. The two programs, one during the day, one at night, filled up almost immediately.

So we hope that by the time these folks complete their certification process, that there will be jobs waiting for them. Another element of our project to emphasize, and that is: local hiring. These kids that are going to go to school and get trained, need to have jobs, and our focus is to hire locally. I think that concludes most of what I was going to say. I know that there'll be an opportunity for questions, and I look forward to that. Thank you very much.

Most definitely will. I'll open it up to my colleagues, who are here, for any questions. I'll look to my right.

Thank you. Appreciate the panel. Great job. Maybe starting with the California Energy Commission -- since 2017, CEC has been awarded more than $27 million in grants for research and development of technologies that facilitate lithium recovery from geothermal-related projects. What are some of the results of these grants? Have they helped develop new technology or cleaner generation of electricity?

That's a great question. Actually, I want to turn to my chief-of-staff, Eric Stokes, who works in the research and development division. So he'll have more details on that.

Yeah. So since 2017, we've awarded a little over $14 million in grants. Many of these projects are still active, so we're still waiting for the results. There has been at least one project that's completed with Energy Source. I don't have the results off the top of my head, but maybe some of our colleagues from Energy Source can speak to it. Mostly what we're trying to do is these are new technologies.

Yeah, maybe a follow up. You know-

These are new technologies. We're just trying to validate them at different scales, just to prove out whether they're going to be feasible. And really, it's a stepping stone to get them to those larger scales that some of the panelists mentioned earlier in their presentations.

Great. Yeah. And was definitely interested in asking about the current state of extraction technology. But a couple of our witnesses touched on that. One of the recommendations of the Lithium Valley Commission was the recommendation of developing new lithium extraction technologies. So I guess the question is, and we got a sense of it, how developed are these technologies? It sounds like, not yet ready in terms of commercial scale, nevertheless still in development -- or how would you characterize where things are at right now?

Yes, I can answer that for BHE renewables. And so we are in the demonstration phase with the technology, which means lab testing has been done, pilot testing has been done, and we're working on demonstration scale testing. And so building up the technology -- does it work? Yes, it works. But we also have to study what are the inputs, what are the outputs, what are the economics of it, and the environmental impacts. And so it's an ongoing study, and that's where we are with the technology.

So our technology, ILiAD, has been in development for about seven and a half years. So we are way down the road from a lot of the other folks out there. And to the extent, that third party validation of our technology is important, and it is -- we have signed a license agreement with a company in Utah, that is under construction and building a plant to use our technology to produce lithium from the Great Salt Lake. So we're pretty confident that we've solved the riddle.

Great. And yes, sir.

I would ask Mr. Signorotti to elaborate that there is a project for a production plant in Imperial County that -- the energy source is already submitted and we can talk about that specifically in California.

Great.

Okay. So I can just add to that, perhaps, that we are shovel ready. We have all of our permits, we obtained the last two permits, agreements, that we needed this year. That was a water supply agreement with the Imperial Irrigation District and our air permit, which is essentially the authority to construct. So our project is shovel ready.

Great. And then one thing we're very interested in is, as you move forward with the technology, the kind of impacts that the process could have on public health, the environment. It sounds like that will be a crucial part of evaluation, but I don't know -- do you want to comment on that at this point, in terms of -- given the shovel ready nature it sounds like, of your project at least.

Right. So I'm not sure where to go with that really. Except that, as I said, we've got a high level of confidence that our technology works. We are in the final stages, we hope, of project financing and hope to break ground soon.

Great. And in terms of anticipated environmental issues, public health, mitigation thereof-

Right. So again, as one of my slides suggested, the CO2 footprint of our project is very low and most of that is going to be from vehicle traffic.

Okay. The commission also recommends that the state fund a health impact analysis, going to that point. Is that report currently underway or is this something that will likely happen in the future? Maybe folks who are involved in the process on that.

Yes, Member Connolly. We are partnering with San Diego State University -- that has been agreed and it has already been initiated. So I believe it was voted on in early June, and I think the agreement has been finalized. So it's already underway.

Right.

There's also a community health assessment in partnership with CHIS and UCLA that is ongoing as well, that will complement that.

Yes. And I would be remiss if I didn't mention that those reports are only taking into consideration the southern portion of the Salton Sea that's located in Imperial County, but we do share the same air basin with the Coachella Valley. So there's still a need to be thinking, holistically, of what the impact around the entire Salton Sea and its communities is going to be.

And I will add, from the Energy Commission perspective, we have funded health studies before, related to our technology and the investments we're making. So we think we can also supplement as needed. We don't have anything secured just yet, or fleshed out, but again, that's a possibility for us that we're considering.

Great. And then final question now, kind of looking at the larger picture, in terms of -- as the technology gets developed, these processes move forward -- anticipating other constraints, maybe. So one being, for example, transmission capacity in the area, that's certainly an issue throughout the state to some extent. But if someone wanted to comment on that, how that's being anticipated and some of those issues going forward.

Well, with respect to transmission in particular, that's the project that we're partnering with Imperial Irrigation District on, to expand transmission to the area -- from the area, I should say, by 1000 megawatts. So as I mentioned, our project is 345. I think Energy Source is 49 megawatts, already connected. But it is more than enough for the geothermal projects and will provide the opportunity to bring in additional solar and battery storage from the area.

So a good mix of renewable resources feeding into the state of California, that's a very critical one. And we're down the path on the development of that project, with the support of the state. And as I mentioned, partnership with IID, the infrastructure needs -- we've identified roads and bridges that need significant improvement and have started work on some of those. And then, expanding broadband to the area is another project. And so we're focused on the geothermal expansion and lithium project.

But certainly to the extent that you build upon that even further with battery companies and truly build out the Lithium Valley that I know is the vision, those early investments in infrastructure to support those companies, as we do onshore production, manufacturing, of a lot of the renewable energy infrastructure. That's going to be key to get going on a lot of those things now, in order to compete with other areas, as Supervisor Kelly mentioned.

Thanks.

Yeah, I think it's important to mention that the state of California has probably, perhaps, hundreds of billions in liability of lack of investment in the Imperial Valley. And that's an enormous amount of money. So I understand that every year the legislature makes budgetary decisions, and while we have phenomenal leaders in Sacramento -- still, it's a heavy lift when we are having to, I guess, negotiate with larger metropolitan areas and we always get -- so over 100 years, as far as my memory, is what I've read.

Not personally. We've been disinvested. You can imagine, hundreds of billions of dollars. It may be trillions of dollars. So these types of projects -- have to say -- can bring relief to California, to lessen that liability. But it is important not to pretend like there aren't going to be significant environmental impacts. That's why the industry has to step in, and step forward, and not fight taxes, not fight community benefits, invest in the best possible technologies.

And whether California pays for it, or Department of Energy, or the federal government altogether and all its agencies, I want to see that money come to my community. I want to make sure that it comes in investing in the best possible technology so that we can be the blueprint. We can be the example for so many countries that are extracting these critical minerals, that are already been harmed. And we have a legacy of pollution left behind. We already have to deal with the current situation, right?

So I want to say, we are optimistic -- as an environmental justice organization, we want to see that investment, and we want to see that environmental mitigation happen from hazardous materials, to air pollution and from traffic. And as Sylvia was mentioning, the whole region, we share the same air base and we share it with Mexico, you know, we have a port. We have all the potential to be a great importer exporter. We're legit inland import port. It's a great base.

We have resources, we have land, but we need this investment. And one other thing I wanted to just mention real quick in terms of transmission, it's great. We've seen transmission. We've seen transmission that takes the solar. And I agree with -- I'm really pleased to hear Supervisor Kelly talk about some of the shortfalls on the solar. We're exporting all that energy. I'm trying to build 20 electric vehicle charging stations, today, and our utility is telling me, we may not have enough power for your next 20 -- but we're talking about exporting more massive highways of power. What about locally? Our infrastructure is failing. We need to do both. Thank you.

Thanks. Yes.

On the topic of investments, both in infrastructure or research and development -- one of the ideas that resonated and kept coming back during our commission meetings, was that, just as the state is incentivizing the development of this technology and industry, that the state and the federal government can also incentivize the ways in which the communities are reaping the benefits. And we don't do that enough.

Like, we'll hand out the money, but we never say, "Well, in return, you need to engage this many people," or, "In return, there needs to be these types of agreements." And I think that is a path that we should explore more of, that, when we are using our public dollars, that there is also an incentive for the industries to be able to engage and sit around tables and build this out in a way that the community is going to benefit.

If I may just add really quickly, we definitely recognize the need, and really the opportunity, to invest in the community, and see what that means in a community like this. And so we are definitely partnered with schools and organizations that take kids to practice -- underserved kids, make sure they have transportation to visit siblings and go to practice and things like that.

We try to find areas that are impactful to the community and give our own dollars in those areas, and certainly recognize we're reaping the benefits of a resource in Imperial Valley. And an excise tax is specifically designed to make sure some of that stays in the community, and have no issue with that, whatsoever. And so certainly the efforts to make sure those dollars stay in the community are very well spent and something that is a very important part of our project.

Thank you very much. I appreciate the line of questions that are centered around the environment, public health -- and I can assure you that there are plenty of eyes, ears, both on the ground and here. You've heard today from our stakeholders that will continue to ask those questions and ensure that those ongoing assessments are taking place. And that's both from industry, as well as our state agencies. And so I can appreciate the time that we've spent on that particular space of conversation.

I want to talk about energy. I want to talk about energy reliability. It was touched on a bit, here, in terms of how we're increasing megawatts with firm renewables. I think it's a question for a CEC representative, both our geothermal developers, and then the county. And I think Mr. Olmedo touched on the idea that -- I'm trying to deploy charging stations, but we don't have enough energy to wire those up.

The unique thing about the lithium conversation, is that -- I've referred to it in the past, as kind of a secondary byproduct of creating energy development for reliability purposes in the state. So I've mentioned who perhaps can touch on that. The real question is: how beneficial is it to increase our energy capacity in this area, to the state of California? Complementary is the lithium recovery process, but can we focus a little bit of time on the energy piece of this?

So, from the Energy Commission perspective, it's vital that we increase our reliability throughout the state. And then in this area in particular, there is a major gap, there's a major need. So I did hear from community, when I visited, about how the lines would come down and then communities would be isolated and wouldn't even be able to get out to get food. So it's a really terrible situation. And the Energy Commission is focused on increasing our reliability. That's another commissioner who leads that work.

But we can definitely participate in those conversations to figure out what more we can do. And we have three applications for geothermal, not related to lithium, but we are considering those. That process is starting to move forward. Can't get into too many details, here, because of the confidentiality of some of it, but those are ways -- bringing on more geothermal is an example, and it's in that area.

And there's been a call out by the California Energy Commission for additional megawatts in the firm renewables. Right? And so the alignment couldn't be better, in terms of the opportunity to reap the co-benefits that we're talking about here.

Absolutely. And we also have the opt-in permitting process, which is another area that I'm leading, so that we can bring on more renewables and be able to rely on those, as opposed to fossil fuels.

Would any of the -- sure, supervisor.

So -- thank you, Chair Garcia. The Imperial County, the known geothermal resource area at the Salton Sea, is one of multiple resources for geothermal energy in Imperial County. The potential for more baseload renewable power out of Imperial County is well beyond, which is being talked about today, of adding just under 400 megawatts. There is areas on our East Mesa, there is areas out on East High Line and the Heber area, in between Brawley and Calipatria. A lot of resources, and it is a very seismic area.

That's why the resource is there. So this has been something that has been discussed for many years, and the RPS is only now coming to the realization it needs it. And that's why I mentioned it earlier, that I'm happy to -- we're having the conversation today, and that the Public Utility Commission made that change in 2021 -- but there's more, there's more that can be there. And I'm sure you got the text messages last week about the Cal ISO and the scheduled, or could-be, potential outages. Look -- there's a resource, it's here, it's in my backyard. Let's come make use of it.

Yes, and I agree. The Public Utility Commission's order for a 1000 megawatts of clean, baseload energy has really brought life to the geothermal resource that we've had. Really, for all this time, geothermal has been, for the last ten years, a very challenging resource to develop, because we're competing with solar, that does not provide the same benefits. And it's very apparent now, in the way the market operates, and there's an appreciation for it that went into that order. And it goes from not being able to develop geothermal, to develop it very quickly and get it online very quickly. And so definitely firing on all cylinders to make that happen, and really, just in the nick of time.

Thank you.

Mr. Chairman. To put it in perspective, though, when we're talking about the entire state, the state's portfolio only has a 6 percent of geothermal.

Yeah, I think it's important to highlight the win-win situation that is in front of us, when it comes to the state's energy needs -- the region's needs -- but the co-benefits that now come with this opportunity of developing additional megawatts in the geothermal space. I wanted to ask questions to Mr. Olmedo and Chair Pas in terms of: what are the remaining questions, anxieties, that we hear on the ground as it relates to lithium recovery in the region?

Some have been touched on, in the process of the questions that Mr. Connolly have asked, but perhaps you missed one, one that comes to mind. We want to hear those perspectives. What are the remaining -- I think we've spent a lot of time talking about the technology, and it having minimal footprint impacts, but there has to be other issues that folks are talking about, that you might be hearing. We'd love to kind of hear from you, directly, what those may be.

Yeah, so we've been doing community meetings. Part of those are part of the Programmatic EIR, community engagement meetings, as well as other meetings that we've been conducting. And the repeated theme is: while the opportunity for lithium extraction is there, there is the fear of what's there right now, which is the Salton Sea and the public health issues. We just had a meeting about informing the community of, sort of, the progress of the Programmatic EIR, and so many of it was about their health, their lack of access to health, the lack of access to healthcare centers, asthma sufferers, their children suffering from asthma. We've had children die around -- near the Salton Sea because of not having adequate health care.

So that's a repeated -- and I know it might seem like, oh, it's disconnected -- but they want information, they want facts, they want data of what's to be expected, in terms of the public health, environmental impacts, when it comes to the cumulative -- coming from what has already been there. I heard a 40-year term. Where is that data? Is it a little bit? Is it a lot? We don't know how much pollution is there.

And what does that mean when you bring in a new industry that will be, I guess, fed from the brines -- what is that going to create, as well? So these are concerns. We have a couple of electric vehicles, and I've been driving one. And so I've been doing a lot of surveying, and it's interesting how many people are driving through the Imperial Valley, coming from Coachella, coming from Los Angeles, from other states, Arizona, Nevada, some people coming from Phoenix and regularly travel these routes.

There is what is travel uncertainty, fear, because of chargers. And I've come to realize that, now that I'm driving an electric vehicle, I realized that -- I didn't even realize that we didn't really have the fast chargers. And now that makes sense because chargers are charging at 31 kilowatts -- I was like, okay, now I see why it takes 3 hours, at best, to charge a full charge. Right. That's on a level three, quote unquote, that we have.

So, others have said, well, how are we going to transition into electric vehicles? They're not affordable. What I'll say to this, is that: I think it's important that -- it's phenomenal how much money is going into this transition. We fully support it. I think there's still a lot of work to be done, whether it's at the policy level and to clean up policy, make it more affordable, more investments going into rural California. I would say that the eastern half of California needs investments.

Lithium Valley, we are the banner for the United States, when it comes to lithium extraction. We should be pouring dollars to make sure that we have these chargers accessible and cars to be affordable. I actually think there is affordability to cars, but because the chargers aren't there, the mindset is, "Well, we can't afford the car. We don't have chargers." Right? So those are the couple of things that I would say that are in great concern.

The other last thing I'll say is -- infrastructure and other things have already been mentioned -- but we have a long history and this keeps coming up from a lot of our experienced advocates. And it's always that trade off, like, oh, you want jobs -- it's a trade off. Right? Jobs or industry? Right? Pollution or food on the table? And I don't think we're living at a point in time that we can kick the can down the road anymore. We already have crises with the most polluted rivers flowing through internationally into the Imperial Valley, the Salton Seas, the fact that we fail repeatedly to meet federal standards for clean water, clean air. So I think we're at that point where it's like, "No, it shouldn't be one or the other. It can be all of it."

And if the industry can't afford it, I encourage the federal government and the state to invest, because this is a great opportunity for the United States of America to get off dependency, off of other more harmful fuels, and be able to create a domestic supply of energy for transportation and other uses. Thank you.

Thank you, Mr. Olmedo. And I will add to what Mr. Olmedo said, echoing the cumulative impacts, the entire Salton Sea region, translating the environmental impacts into public health impacts. And I think the big question surrounding this has been: who benefits and what is the cost, right? So people are wondering, "How is it possible that a region like ours will get to reap the entire benefits of a lithium supply chain, when we're struggling to keep our own lights on, when we're struggling to connect to the Internet, when we do not have dependent transportation, do not have dependent roads, there's a lack of housing." So all of this is in the backdrop of a promise to change. I don't want to end it with all skepticism.

I do believe we have an opportunity, and with the dollars, one-time dollars, that we're seeing right now from the federal government, to really concentrate on a strategy that's going to uplift this region, and really set it up to build out on the region's potential. And the other question, even amongst all this promise is: what will it look like when people see geothermal plants, and we're talking about increasing those geothermal plants? What is going to be the altered physical built environment? Is it pleasing to the eyes? Do I want to be living near them?

That's an excellent point. We oftentimes -- when people see the geothermal plants and they see the steam, the immediate reaction is that that's pollution, right? That that is carbon up in the air. Supervisor, some touched on the offtakers. What is it that you see at the county in terms of the ecosystem that is developing around the lithium recovery process, energy production? And are you at a point where you can talk about what some of those publicly known offtakers -- who they are, what they are, what that brings to the county for the folks that you represent in that region?

Well, thank you, Chair Garcia, and you probably know what the response is, but I can't say the specific companies -- we have been meeting with battery companies, some of the geothermal resource holders have offtake agreements with General Motors, Ford, Stellantis, for supplying lithium carbonate or lithium hydroxide. We have been talking to cathode companies, foreign and domestic. We've been talking to battery companies, mostly foreign, and they're talking about cohabitation or co-location in Lithium Valley.

There was one company that has bought land purchase, that is looking at doing a battery plant outside of Lithium Valley. So what I feel I can say comfortably, is that there will be new geothermal power, generation, in Imperial County. There will be mineral extraction in Imperial County. The manufacturing is the open question in my mind because there has to be policy direction and coordination, now. As I mentioned earlier, choices are being made across the country.

We have, for the past twelve months, have been focusing on trying to identify and get into the conversation with companies you're very familiar with in name and brand, that are announcing locations in Indiana, Michigan, Tennessee -- and some of them we have spoken to, but they are continuing not to make that final choice of California. And so I know that Commissioner Gallardo has spoken to that, to you today, about consolidating the state resources and putting a point person together.

We have established a Lithium Valley office to be that liaison between industry and the public sector. We are really hoping, and have made that request, that the state of California establish that representative for the state asset in Imperial County, as well. In addition, and something of interest to Ms. Knapp, is that there is a state agency called CalGEM, under the Department of Conservation, that is responsible for all the drilling that will be occurring and overseeing that. They used to have an office in El Centro, California. They closed it about six years ago to consolidate resources into the LA Basin. We've talked to CalGEM, they are trying to gear up, in knowing of the amount of need that will be in Imperial Valley, and we are supporting the idea that they come back and relocate where the geothermal resources are going to be developed.

Thank you. We've seen, we've also read, more recently, that some of our geothermal developers, lithium companies, have received some state grants, in the range of $10 million, $30 million, whether it be the ... program, GoBiz, Innovation Dollars. Last year's budget had unprecedented amount of investments in this space, and for this specific purpose, Imperial County development of lithium economy. We have the federal government, Department of Energy, here with us today. We, in my opinion, have not seen the level of activity and investment that the state of California has put forward, over the course of the last few years, on this specific item. The gentlemen with us right now, Stephen Boyd, do we have any questions for him? Anyone on the panel? Anyone up here?

Because I think we should take full advantage of the fact that we have information, and perhaps, some potential direction that we may be able to take, to see our federal partners move in this space as efficiently and committed as the state of California has over the last two years. Please.

Yes. Two things real quick. One is: it's great to have the opportunity at some point, hopefully sooner than later, to have a tax that will get reinvested back. So it is disheartening to see that there's efforts to repeal that tax. And I hope that the industries that are seeking to build, in Imperial, are not subscribing to that. The very important thing to the Department of Energy-

-We've actually gotten calls from applicants, who are now seeking funding from the federal government, Department of Energy, where the Department of Energy -- and maybe the gentleman, who's doing testimony today, from Department of Energy, can maybe shed light on that -- but these industries are showing up in our communities and saying, "Hey, as a requirement of us accessing these federal dollars, we need to come up with a community benefits agreement, and a signed agreement, not just verbal -- signed agreements."

So I really highly encourage that more of that is also done at the state level, because there's so much talk about community benefits, everybody's -- but then we see all these -- trying to go around that. But hopefully the gentleman from the Department of Energy can shed some light on that.

Mr. Boyd?

Sure, and I apologize, hope you guys can hear me okay. You're right. We are asking for community benefits agreements as part of projects that are responding, at least, to the bipartisan infrastructure law that I mentioned. And correct. The more that you provided with that, the better. As sort of other folks have mentioned, I don't think I could share, in particular, from some of the proposals we've received, but I'm glad that you all have recognized that, and that's been helpful.

Thank you. Any other questions us? Yes, supervisor.

About a year ago, the county partnered with Berkshire Hathaway Renewable on an application to the Department of Energy. It was a matching grant that the company was looking to make investments in Lithium Valley for infrastructure and also community and education pieces. And unfortunately, that did not get funded in the first round, in October, early November of 2022.

And I know that we're making our own submission in this round, but it was -- after having the Secretary of Energy visit the site, after having multiple visits from elements of the Department of Energy, and knowing the significance of the resource, and then the choices -- it kind of made me scratch my head of why they made the choices they made in the locations that they approved, when California has been setting the policy. And then this resource is so significant, and I would ask if Alicia wanted to add to that question.

Thank you. So, yes, the opportunity that Supervisor Kelly is referring to, I think it would be great to hear -- I know people are wanting to know why our project wasn't selected. What we're most interested in knowing, and certainly we'll continue to work towards, is understanding that, so that future opportunities -- the project is even more competitive for those. So certainly any information, I'm sure, is welcome for everyone.

But specifically, when it relates to the community benefits plan, what I would say is, we did work together to put together a community benefits plan with a lot of local entities and stakeholders, and submitted that with part of the application. And to the extent that there's another opportunity that looks like it's appropriate for us to participate in, that's not an effort that starts again once the opportunity comes out. It's an ongoing effort for us.

So regardless of if there's a DOE funding opportunity, I do believe we'll have a very robust community benefits plan. And that's something that we'll be talking with people locally about, to understand : what are their concerns? How do we address concerns? What does it mean to be a good partner in this community? We have a pretty good idea, since we're here, but it's something that will be ready to go for the next opportunity, certainly, not an effort that was just for the DOE application.

Thank you. Mr. Boyd, any thoughts, feedback on those points that were just made by Supervisor and BHE representative?

Yeah. I mean, I don't know if there was necessarily a question there, but I will say I appreciate -- we, of course, had many applications in our first round, and many of them were very good. I know individual applicants received comments directly, but other than that, there's really not much that we can say from a procurement like this. But I definitely appreciate a lot of what folks said. We understand these projects are large efforts and are continually ongoing. And we also recognize that although we've been through a lot up to that point, we've continued to learn more on these. And so I appreciate folks staying engaged with us, and definitely looking forward to being able to do another round of these projects.

Thank you. We have a question from Commissioner Gallardo.

Mr. Boyd, I was curious if there's anything else that California can do to help the Department of Energy provide more resources, support, et cetera, to California. And just offering, as an example -- we did have the Department of Energy, Department of Defense come do a visit to the Imperial Valley area to get more familiar with Lithium Valley and its possibilities. Is there anything else that we can do from your perspective?

Yeah, very much recognize and appreciate not only the effort in planning the visit, but the help that you all provided to us, as well as all the presentations from the folks that we went and saw, which it was absolutely wonderful. No additional ask at this time. Thank you.

Thank you. Mr. Boyd, just one last question, and that would be: what should the locals be looking out for, as it relates to the next round of fundings? The categories that are out there that are applicable to our particular region, this particular technology? Given the strong emphasis on critical minerals by the federal government, and making large investments in economically marginalized, disadvantaged communities -- what should we, as a state, collectively, with our partners here, expect to ambitiously pursue over the next few months, as we continue to uplift this region of the state, centered around electrification and energy reliability?

It? Yeah, it's definitely a broad question that I probably don't have all the right answers mean. I know individually our office manufacturing and energy supply chains has an email list where we send out notifications for open programs that we release many of those which may apply or be of interest to you all, but certainly other DOE offices do this in similar areas. And I know we also have efforts to engage with stakeholders such as yourselves that we can follow up with if you'd like.

Thank you. I know we're getting close to wrapping up. I want to thank you for joining us today, Mr. Boyd and all of the witnesses here. We do have a section for public comments for those who are here with us today. If we can go back to the top of the agenda and perhaps use 30 seconds each individual, what would be some of your closing remarks to today's hearing? And so we'll start with the chair.

Thank you again. I'll highlight that there is many co benefits, not just for energy, but for what our communities can look like. And at the end of the day, I think how we can measure success on this energy transition is not going to be on whether the industry figured out the best technology to get out to extract lithium. It's really going to be on how our communities are, what they look like, are they healthier and thriving. And I think that's the measurement that we should be keeping in mind. Thank you.

Thank you, Chair Garcia and Members of the committee. I'll just leave with an action item that I would like to return to give you a more comprehensive report. Once we've started convening the state agency partners working a little bit more closely with the federal opportunities that I see, with the military in particular, and give you more of that information and what we're doing on the recommendations and to advance those. Thank you for having me.

Thank you. Chair Garcia. Just want to say that the opportunity is now and that I know that the state is marshaling forces with Commissioner Gallardo and we want to work hand in hand with them. I recognize your call to Department of Energy would love to be able to see them walking in lockstep with us as well to promote this opportunity.

And I would say thank you, Mr. Chair, for having me here today. This has been a great opportunity to hear concerns and make sure that we're addressing them in our project planning and the development of both our lithium and geothermal projects. Participating in the Lithium Valley Commission and being able to have all of that feedback delivered to us in the report was extremely helpful. So if we don't hear the concerns, we might miss them and they'll get raised at some point in time.

And so it's best for all of us if we're able to work together early and often. And this has been a great opportunity for that. And also from all of my fellow panel participants, it's a great opportunity for us to get together and talk about how to deliver this the right way for the community.

Thank you, Chairman. I'm just going to mention that Energy Source Minerals, in the last couple of months has hosted two community forums. They were both advertised in the paper, on the radio, and we had over 150 people attend each of them. So there is definitely a buzz in the community. We hosted those forums for the reasons that we're talking about now, to educate the community to dispel myths and to answer their questions. So great turnout, and we're going to continue to be very active in the community.

Thank you. Thank you. Olmedo.

Thank you. Just have three asks, and one is that the Legislature and everyone else who's a key player in this, which hopefully will yield a success, is that please understand that this community cannot afford any harm. This cannot be like the traditional negotiations where a little harm for a job, there is no opportunity for harm.

And COVID proved that by having the most amount of harm as a result of COVID Respect the fence line communities, know the geography, know where the Song Sea is, know where the closest communities are and give them dignity, give them respect, don't empower them. Put them in positions of power and give them a voice. And that's the state of California and to the federal government and everyone else involved.

And finally, it's disheartening to see that whenever there's an opportunity, all of a sudden, everyone is about Lithium Valley and everyone is the broker of the negotiations, the people that I've never even heard of in my life, knocking the doors of Washington, knocking on the doors of Sacramento. Please know the community. Talk to us. We're there, right? Talk to our region. We're there. And as far as the investments coming out of Sacramento and particularly the federal government, please invest on Main Street. Not just Wall Street.

Invest in Main Street. We can build, we can do local projects. We can be the Silicon Valley. That's why it's a lithium valley. Invest locally. Help us create startups. Help us build infrastructure. Help us make charging stations. So thank you.

Thank you very much. I want to thank you again for being here today and traveling to Sacramento to inform the Legislature on the work that's been done over the last year with the Lithium Valley Commission report. It's also a great opportunity for my colleagues to hear what is happening in our region isn't just an Eduardo Garcia project, an Imperial County project. This is a global and national opportunity to achieve our ambitious climate and energy goals in this.

So the more we are setting the context in that manner, I think the impact becomes larger with our colleagues here in the Legislature. And it isn't just a special ask by the Assembly Member who represents that area. This is in the best interests of California and this entire country. And so I wanted to, again, just to emphasize that on how important it is, your presence here today and giving an update on the work that's being done. With that, again, thank you.

We're going to open it up for public comments at this time. Anyone wishing to speak to the joint hearing, you may do so. Please step forward. Your name, affiliation, and if you can do so in less than a minute, I think everyone would appreciate it. Less than a minute.

Mr. Chair, Members Mike Monagan, on behalf of the Building and Construction Trades Council, first of all, thank Chair Paws and the rest of the Members of the Commission and all the hard work that they did over the last year or so. I'd like to expand a little bit on what Mr. Olmedo talked about with respect to project labor agreements and maintenance agreements. These are the vehicles that create apprenticeship programs. Apprenticeship programs are the vehicles that take a job and turn it into a career.

We're not talking about a single job. We're talking about getting the men and women, the young men and women from Imperial County into a situation where they can thrive and be a part of the middle class, good paying jobs. Also, the building trades are here for the long haul. Continue to work with the Board of Supervisors, Mr. Almeido, and his partners, on creating some community benefits and making sure that these jobs stay in Period County. Thank you. Thank you.

Good afternoon, Mr. Chair. Tom Hinsey International rep from UAW, commenting on behalf of the United Auto Workers. We appreciate the opportunity to be here. Our Members are building EVs and next generation lithium batteries across the country. This transition is really important to us. It's important that we have a just transition and get it right. We're a proud Member of the Lithium Valley Community Coalition with Mr. Olmeto and other organizations.

And for us, labor peace agreements are, what my colleague from the building trades said, the equivalent for operations and for permanent workers who will be working in facilities and battery manufacturing, which we want to work together with everyone to help to co locate. In California, the best way for labor peace agreements to apply is with the local hiring standards and the training standards that my colleague was mentioning. Also, in community benefits agreements, where we can also secure funding and resources for the local communities. So we're proud to work with Comite Civico del Valle, proud to be a part of the coalition and look forward to future conversations. Thank you.

Thank you very much. Seeing no one else in line. Again, just want to thank everyone for participating in today's joint Hearing. This meeting is adjourned.