There appears to be a consensus on the need for more efficient permitting of energy infrastructure to support the nation’s transition to cleaner generation. But how best to achieve that objective is a matter of controversy. The regulatory initiatives of the Biden Administration, in some regards, appear to unnecessarily impede rather than to promote that objective. A more holistic approach to permitting reform might be worth considering.
Last year began with the Biden Administration’s national climate adviser, Ali Zaidi, expressing “optimism” in remarks at Georgetown University that permitting reform legislation would pass Congress. That expression of optimism was followed by intense negotiation over “streamlining” NEPA and other regulatory reviews during congressional consideration of the Fiscal Responsibility Act of 2023 (FRA).
The FRA did address some permitting reforms, but it did not resolve other key priorities including shortening the statute of limitations for challenging NEPA actions and improving siting and cost allocation processes. And, in May 2024, the CEQ issued rules attempting to expedite NEPA review through page limits, time limits, and a regulatory exclusion “for categories of actions that normally do not have a significant effect on the human environment.” But in those same rules, in addressing climate change and environmental justice, the CEQ included requirements that could have the opposite effect, by expanding NEPA reviews and creating new opportunities for litigation.
In another example, in its regulatory impact analysis of the recent Clean Air Act rule establishing CO2 performance standards for electric generating units, EPA projects that the Inflation Reduction Act (IRA) will lead to reductions in power sector emissions of 80% below 2005 levels by 2040. EPA then projects that the Clean Air Act rule, over the same period, would reduce power sector emissions by essentially the same amount–by 81% below 2005 levels in 2040. So, if implementation of IRA is projected to result in these emission reductions, why not focus on making sure full implementation of IRA is realized in a timely fashion?
Rather than facilitating implementation of IRA, EPA’s GHG rule creates obstacles. The rule establishes performance standards based on (i) carbon capture and sequestration (CCS) for existing coal-fired generators scheduled to operate beyond 2039 and for new, base load gas-fired turbines, and (ii) 40% natural gas co-firing for coal-fired generators retiring after 2032 but before 2040. Development of the infrastructure for these technologies will require massive permitting efforts in the coming years for thousands of miles of new pipelines for CO2 and natural gas, for geological storage sites for CO2, and for technologies for CO2 capture and natural gas co-firing.
Review of new pipeline projects under NEPA can involve review by multiple federal agencies, significant stakeholder input, and take years to complete. Proposed pipeline projects that cross water could require permits from the U.S. Army Corps of Engineers. If proposed projects affect a listed endangered or threatened species, consultation with the U.S. Fish & Wildlife Service could be required. These permitting challenges, exacerbated by the lack of a clear regulatory regime for interstate CO2 pipelines, will be compounded by significant local and regional opposition to CO2 pipelines and sequestration sites, which currently include community moratoriums prohibiting them.
Achieving the benefits of IRA will require substantial permitting of renewable generation and energy infrastructure. Permitting those projects will be complicated and delayed by the additional permitting burdens imposed by EPA’s GHG rule and the related litigation they bring. Why not focus on achieving IRA’s benefits by meaningful permitting reform as opposed to imposing additional burdens that will complicate those efforts?
