If you are in the energy business you are probably familiar with energy surety bonds. These types of permit bonds are regulated by government agencies and in most cases required by the state and/or county. As an operator of a type of energy business such as wind, solar, or oil drilling installation of new sites or operation of existing entities you will be required to follow a slew of laws and regulations.


This can include obtaining proper permits, following all compliance regulations and carrying the appropriate insurance to protect the state and/or county in the event you don’t meet your obligations.

For instance, if you want to install a gas pipeline, you are required by Maricopa county to obtain a permit. You must complete an application as well as payment and submit it to MCDOT for approval. Your application may be returned with comments or items that are required to be changed prior to being approved. When you are granted approval, and all your other obligations have been met you can begin work. Some projects will have inspections throughout and all projects should notify MCDOT upon completion. As you can see, the county has a vested interest in these types of undertakings and regulates them as such.

Surety Bonds:

Surety bonds are like a type of insurance for the state or county. You, as the principal of the project, are required to carry a surety bond for any new or ongoing energy activity in Casa Grande or Maricopa county. The surety bond protects the county financially in the event that you do not live up to your responsibilities and that lack of performance has a negative financial impact.

The Mechanics of Surety Bonds:

Insurance companies issue a surety bond to the principal, in this example you, and name the County as the obligee. As the principal, you are responsible for the cost of the bond. Then, if you fail to fulfill your obligations, the obligee can file a claim which the surety bond will pay. The bond company can then in turn recoup the money from you. There is typically an annual premium for the bond for the length of your project.

Which Bond is Right For You?

There is no one size fits all solution here. You want the type of surety bond required, for the amount of coverage you need without overpaying for coverage you don’t. Some items that will help determine the type and amount of the best bond for you include:

The type of project you are working on: if your project is potentially more expensive or complex, the cost to insure against financial loss may be greater.

The number of sites: Multiple locations/sites mean more complex projects and opportunities for things to go wrong. This typically increases the risk and expense of a bond.

Where you live: Your state and county will have specific bond minimums that will have to be met so your location is an important factor.

Your obligations (and the length of said obligations): Your financial obligations and the time frame of the project can both impact the cost of your bond. The longer your project and the more financial responsibility, the greater the potential risk.

Your credit: The bond company doesn’t want to deal with a claim against you or their bond. It acts like any other insurance company in that the lower the risk, the less expensive the fees. Your credit is taken into account when reviewing your bond application. If you have good credit, it can help lower your costs, while a lower credit score can do the opposite.

If you are navigating the world of surety and permit bonds, leave the heavy lifting to us so that you can invest your time in your project. Whether you want to install a new wind generator or are taking over existing oil wells we can get you through the bond process in no time at all. Our team of experts have years of experience making sure our customers meet their legal obligations and have the bond that they need. Give our office a call and give us the opportunity to earn your business today.