Over the last several years, we’ve written consistently about the many regulatory or permitting hurdles facing the energy industry as the U.S. continues to transition to a majority renewables grid. Back in November, we quipped, “it’s permitting, stupid,” when asking ourselves why renewables weren’t being brought online at a faster clip when the domestic appetite for them is clearly there.
Simply put, a good permitting climate produces a good investment climate. Or, as Senator Lisa Murkowski said back in 2017, “given the right investment climate,” private dollars would move from the sidelines to the playing field, helping to modernize and update aging U.S. energy infrastructure. D.R. Gribbin, with the progressive-leaning Brookings Institution, recently echoed this sentiment in a blog post by calling “for a once-in-a-generation change to America’s energy infrastructure should include similar calls to modernize the way these projects are permitted.”
Environmental review is important, but has the pendulum swung too far to one side, to the detriment of upgrading our energy infrastructure? If you were to ask Warren Buffett that question, the answer would be “yes.” The reason? In Wyoming, his own Pacific Power had to wait 11 years, from 2007-2018, to get the necessary federal permits to build the Gateway West high voltage transmission line from Glenrock Wyoming to Murphy, Idaho. This critical infrastructure project enhances overall electric reliability in the Intermountain West. It also could integrate up to 2,250 megawatts of wind energy or enough power for about 1.5 million homes.
For these benefits alone, it’s not surprising that Gribbin rightfully points out that “we need to address how to help projects navigate the slew of environmental regulations that could stall next-generation infrastructure. The relevant [environmental] statutes…simply don’t reflect the needs and challenges of today.”
What is Gribbin referencing? Most of all, the National Environmental Policy Act (NEPA), which is the cornerstone of environmental law in the U.S. President Nixon signed NEPA into law on January 1, 1970, with scant opposition in Congress. At only six pages, it seems like a simple law.
Unfortunately, over 50 years, this six-page law has mushroomed into thousands of pages of onerous regulations grounding many promising projects to a halt. Even opponents of NEPA reform like the Solar Energy Industries Association have lamented that “in our experience, environmental review of a proposed solar plant on public land can take three to five years…streamlining and expediting NEPA reviews could reduce costs and delays.”
Or, as Gribbin notes, “the permitting process has led to laudable improvements in the quality of our nation’s air and water. However, over time they have also slowed down the deployment of critical infrastructure, including renewable energy projects.”
President Biden has an aggressive target of having “a carbon pollution-free power sector by 2035.” It will take massive amounts of public and private investment to meet this target. Perhaps as much as anything, it will require leadership from President Biden in streamlining the federal permitting process to achieve this bold transformation of the U.S electric infrastructure sector.