Low-Energy Fridays: Another Stab at Permitting Reform This Congress
It has become apparent in recent years that the status quo of permitting in the United States is untenable. For major infrastructure projects, it takes an average of four-plus years just to get a permit issued—and even then, those decisions are highly likely to be contested in court by external groups seeking to delay a project. Our research (and others’) consistently shows clean energy as the biggest loser under the current permitting regime.
But a new permitting reform bill has entered the chat. Earlier this week, the Senate Energy and Natural Resources Committee marked up a bipartisan permitting bill introduced by Sens. Joe Manchin (I-W.Va.) and John Barrasso (R-Wyo.). The bill is a serious, comprehensive effort at permitting reform with something for everyone, though no one gets everything they want.
Without diving too deeply into the specifics of the 75-page bill, it would shorten the statute of limitations for energy and mining projects to 150 days (i.e., project opponents must file lawsuits within 150 days instead of the current six years), and would give renewable energy categorical exclusions from environmental review similar to the oil and gas industry. It would also make it easier for transmission projects to move ahead under faster federal permitting processes with less delay from states. Reforms to things like liquefied natural gas exports, mining leases, and hydropower are also included.
While it’s a valiant effort at reform, it’s incomplete. For example, adjustments to judicial review really should go further than just shortening the statute of limitations. Most permit decisions are litigated almost immediately, but a key issue is whether agencies can adequately address litigation risks in their permits before issuing them. The 2015 Fixing America’s Surface Transportation Act allows some major project permits to require litigation plaintiffs to submit comments addressing potential permit inadequacy during public comment periods, which has generally led to higher-quality, faster permits. This ought to be expanded to other energy projects, but because groups that litigate under the National Environmental Policy Act to delay infrastructure vociferously oppose such reforms, the Manchin-Barrasso bill sidesteps the policy issue entirely.
If the bill in its current form becomes law, it would shorten permitting timelines—especially for renewables and minerals—and rein in some of the Biden administration’s more contentious moves with respect to natural gas exports and offshore energy leasing. It also achieves this in a way that avoids having to touch some of the controversial permitting topics, such as endangered species’ habitats. Sure, the Center for Biological Diversity immediately came out against it, but as their strategy for energy and climate solutions is to “pioneer” litigation strategies, they are likely to oppose any permitting reform that makes it harder to delay projects via the courts (which are mostly clean energy ones).
A permitting reform bill will probably never make everyone happy, which likely explains the omission of some of the more disputed policy ideas discussed in recent years. If history is any guide, permitting reform will be a process with multiple legislative pushes building upon each other (with this one building on the 2023 Fiscal Responsibility Act). To that end, the bill should be graded on whether it makes Americans worse or better off. As the bill would yield economic benefit by shortening permitting timelines and environmental benefit by making it easier to build clean energy, it seems like a win.
But the bill has a long way to go before becoming law. Whether a bill is politically viable isn’t always the only objective: The immediate value of the Manchin-Barrasso bill is that it is eliciting comments from groups and experts, describing where they stand on permitting. That makes it a lot easier to recognize overlap between Democrats and Republicans (the bill sailed through the committee mark-up with a bipartisan 15-4 vote) and to identify opponents who could never be pleased (which, ironically, weakens their influence on the legislation).
When Speaker Kevin McCarthy was forced out, it left the future of permitting policy in uncertain territory. The issue was, after all, a signature one for him, and it is likely lower on the list of Speaker Mike Johnson’s current priorities. The Manchin-Barrasso bill is a shot in the arm for permitting reform in general and a big step toward the outcomes the energy industry has sought for a while now.