The Look-Ahead on Permitting Reform

Mark Green
Posted June 7, 2023

It’s hard to exaggerate the importance of parts in the debt ceiling legislation that start modernizing America’s permitting processes for all kinds of infrastructure – including natural gas and oil projects. Those long-overdue provisions resulted from support from a broad, bipartisan array of interests and political figures.

Well done. Now, let’s do more.

Indeed, more permitting reform is needed so that America can build big again. And not just for our industry. As the U.S. Chamber’s Marty Durbin said this week at a permitting policy discussion hosted by Semafor: “This is about permitting reform for energy, yes. But also water projects, port projects, broadband projects, roads and bridges – all of those projects are also in need of permitting reform to help us build the economy.”

The next phase of permitting reform could be complicated as the quest for the issue’s higher-hanging fruit could create fissures in the broad support mentioned above. That was one takeaway from Semafor’s event.

Moderators asked the invited representatives of environmental groups whether there’s more middle ground for additional improvements to permitting processes, including modernization of the National Environmental Policy Act (NEPA). Not really, indicated one; maybe suggested another, the Nature Conservancy’s Jason Albritton:

“We need robust environmental reviews, but there are always efficiencies that can be gained in the process and trying to find those … that's the balance. How do we find that balance, and really helping and engaging in the process to identify some of those policy reforms that we think strike that right balance is how we want to engage in this conversation. I think we can make some progress, and I think there are groups that are willing to do that.”

Certainly, environmentalists are keen on permitting to help speed up construction of high-voltage transmission lines, seen as critical to the eventual build-out of wind and solar. Yet, they’re wary of changes to NEPA. U.S. Rep. Scott Peters, D-California, said intransigence should end on NEPA, under which environmental impact analyses have averaged 4.5 years in duration and more than 600 pages in length, according to one study.

Congressman Peters at Semafor:

“I think people are coming around to the notion that we have to do things faster. But you talk about NEPA, you hear this term it’s a bedrock environmental law, and people are really nervous about any change to it, and we've got to get over that. … These things did not come from Moses. They didn't come on tablets. … We have to modify those laws to meet the challenge of today.”

Another challenge is getting policymakers to take the right approach to the next stage of reform. Some interests want changes that boost narrow technologies. The better approach for America is to pursue reforms that fix broken or dysfunctional processes – without respect to different kinds of infrastructure. Needed is a level playing field for infrastructure, where the marketplace picks winners instead of Washington.

The Bipartisan Policy Center’s Lesley Jantarasami:

“I don't think that we want it to be just so narrowly focused on specific types of infrastructure. I think it's about process – you know, the ability to really deliver on the promise of the Inflation Reduction Act, the Bipartisan Infrastructure Law and those things that are investing in creating this new economic driver and jobs. … A lot of these conversations just boil down to, ‘I want transmission, I want pipelines,’ and it’s hopefully going to be more about, well, what are the interests that are coming to this [and] then what are those processes and policies that can achieve those outcomes that we’re looking for?”

General Electric’s Roger Martella:

“We want to see an all-of-the-above solution. We think, in this political environment, we can't be picking winners and losers. We need holistic solutions for clean energy, for energy security, for conventional energy. All of that gets us to decarbonization. All that gets us to energy security. … We want an all-the-above solution.”

Politics and timing probably will increasingly come into play. Jantarasami said the approaching 2024 presidential race will raise the degree of difficulty for big policy moves in Washington – though Durbin said the forward momentum already achieved could coax action, even within a narrower political window.

Washington axioms like “politics is the art of the possible,” “not allowing the perfect to become the enemy of the good” and others come to mind. Peters said 85% of the energy projects waiting to be built are carbon-free and that “those of us who are trying to advance climate action have to be comfortable giving up 15 to get 85.”

Let’s hope such common sense prevails. America will be better for it if Washington follows up with additional reforms that address uncertainty in permitting processes.

Martella:

“What we're really solving for is the question of certainty. Uncertainty is the Achilles heel of clean energy projects, of fossil fuel projects. When I was at the Justice Department, we never lost a NEPA case. We would win 100% of the cases – eventually. But the uncertainty in the dragging out the decision-making … and the lack of uncertainty, and the lack of certainty with judicial timing – that’s what would kill projects.

“Not the ultimate decision, but I saw many projects get delayed or canceled because they couldn't wait. So, we have to balance our process with the question of certainty, and that's where we can have deadlines, we can have limitations, we can ensure public participation. But do it in a way that brings certainty to the business because that will enable us then to achieve the full potential of the IRA, the infrastructure [law], climate change and energy security.” 

Stay tuned. Much has been accomplished, but more is needed. As noted, permitting reform is widely supported by both major political parties, and if that continues as the permitting issues become more specific, additional progress can be made.

Durbin said there’s reason for optimism because of the bipartisan energy for more change.

“We won’t get everybody,” he said, “but there’s a much more constructive conversation going on today than we’ve seen in the past.”