Clean energy projects: What to know about the permitting logjam
More than 1,000 projects tread water as they wait an average of four years for a federal permit. Read More
The term “permitting reform” has grown tiresome for many in the clean energy sector, given how often it’s been uttered, published or volleyed about in the last four years.
But the constant focus on permitting reform is valid — crucial, even — for the future of U.S. grid stability, electricity production, and all forms of power development. At its most basic, permitting reform refers to the overhauling of the federal process to approve large infrastructure projects. A permit is required for the construction of a road to the development of a massive wind farm. The problem, however, is that efforts to expedite permitting face their own bottleneck, much like the problem they’re meant to solve.
Permitting reform: Where it stands
In an effort to reach the Biden administration’s goal to cut U.S. emissions in half by 2030, the president passed the Inflation Reduction Act (IRA). Since its passage, 340 clean energy projects and nearly $1.3 billion in investments have been announced. But most of these projects depend upon receiving federal permit approval to break ground, a feat not easily achieved with the current massive applicant backlog.
According to the Federal Infrastructure Permitting Dashboard, 1,081 projects are in the process of obtaining a federal permit approval. The projects range from wind farms to hydropower projects to broadband installation. Those projects include those in-progress, paused and those that are planned.
Research from Brookings Institute found that wait time for federal permits has decreased from around nine years between 2007 and 2015 to around four years between 2016 and 2023. As of January, more than 1,100 gigawatt of projects were still undergoing interconnection studies — just one step of the permit approval process.
Loads of projects sit idle as ‘In Progress’
Clean energy projects, specifically, depend upon an effective permitting process due to their reliance on transmission lines, according to Aidan Mackenzie, infrastructure policy analyst at the Institute for Progress (IFP).
“[Clean energy companies] just have to have a transmission line [to] send the power they’re producing to a place they can sell it at a competitive rate,” said Mackenzie. Without the infrastructure of the transmissions line, there isn’t any way to transport the energy generated to the grid.
The Biden administration is attempting to address the indelible connection between transmission lines and clean energy projects with the creation of the Coordinated Interagency Transmission Authorization and Permits (CITAP) office within the Department of Energy. CITAP will centralize the permit application process, reducing the number of offices and steps formerly required to one location and team. But the rule’s effectiveness depends upon DOE leadership and allocated resources from the administration in charge, making its effectiveness more vulnerable compared to a codified permitting reform law.
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In contrast, oil and gas production has a much sturdier, established path. Fossil fuels have an established pipeline infrastructure to use for transportation, and “if those get blocked or can’t get built, you can put [the oil and gas] on train,” said IFP’s Mackenzie.
Despite the increased demand for permitting, Congress is slow to pass a legislative response that addresses the backlog.
“This Congress, the story has been that Republicans have been hesitant to support any kind of transmission reforms … and Democrats have been pretty wary of the Republican agenda on energy, usually seeing it as like a smoke screen for fossil fuels,” said Mackenzie.
Likelihood of success growing
On Aug. 6, the Energy Permitting Reform Act (EPRA), co-sponsored by Sens. Joe Manchin (I-W.Va.) and John Barrasso (R-Wyo.), successfully made its way through the Senate Energy and Natural Resources Committee. It still needs to make it through floor votes in both the Senate and the House before President Joe Biden can sign it into law.
And its likelihood of success is growing.
“This is the first [permit reform] bill this Congress that’s actually had a serious chance of passing,” said Mackenzie, citing its bipartisan nature and well-balanced tone as one reason for its continued success.
The new bill strikes a balance between the needs of both political parties, mandating that Federal Energy Regulatory Commission establish a rule addressing interregional transmission planning within 180 days after the passage of the bill and thus solving a major clean energy development problem while also streamlining oil, gas and LNG approvals.
It’s likely to sit until after the election and pick up steam during the lame duck session, according to Mackenzie. He explained that lame duck sessions are free of election-related pressures for lawmakers, allowing the Democrats more space to compromise on fossil fuel provisions included in the bill without fear of losing reelection.
Simultaneously, House Natural Resources Committee Chair Bruce Westerman (R-Ark.) introduced a House bill that addresses permitting reform. On Sept. 11, the Natural Resources Committee held a hearing to discuss the details of the legislation, including its provisions to streamline and accelerate environmental reviews and limit legal challenges.
“This hearing is a notable step in advancing federal permitting reform,” said Lisa Jacobson, president of the Business Council for Sustainable Energy, in a statement following the hearing.
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