Powering Strong Communities

Streamlining Energy Infrastructure Permitting

PDF: Streamlining Energy Infrastructure Permitting Brief.

Summary

The American Public Power Association (APPA) urges federal policymakers to streamline federal permitting and siting rules to help facilitate the construction of cost-effective energy infrastructure necessary to maintain electric reliability and to accommodate a changing resource mix.
APPA supports conducting environmental reviews and permitting processes in a concurrent, coordinated, consistent, predictable, and timely manner sufficient to support sound decisions regarding federal agency actions, such as approving new infrastructure projects.
APPA encourages the Federal Energy Regulatory Commission (FERC) to promote electric transmission siting and permitting by facilitating open and transparent transmission planning processes that prioritize reliably meeting the needs of public power utilities and other load-serving entities.

Background

Providing reliable and affordable electricity to American consumers requires an expansive infrastructure system, and the capital to plan, build, and maintain it. America’s energy infrastructure includes power plants, hydroelectric dams, transmission and distribution wires, and fuel delivery systems, such as interstate natural gas pipelines. The need for cost-effective infrastructure to support reliable and affordable electricity is particularly acute today to balance intermittent resources. Rapid growth in wind, solar, storage, and distributed energy resources, and the need for flexible resources, such as natural gas-fueled generation, are all part of that quickly evolving generation resource mix. Electrification of the transportation sector and increased severe weather events are also driving more demands on the electric grid.

Streamlined environmental reviews under the National Environmental Policy Act (NEPA) are integral in ensuring that energy infrastructure projects move forward. NEPA requires federal agencies to consider the environmental impacts of proposed major federal actions as part of an agency’s decision-making process. Environmental reviews and authorizations that involve multiple federal, state, and local agencies are common. These reviews are often time-consuming, fragmented, inefficient, and costly to project proponents. While state and local governments generally have authority over the siting and construction of electric power lines, federal policymakers can influence transmission, planning, permitting, and siting. In some cases, transmission siting authority resides with federal agencies, requiring NEPA review.

The Federal Energy Regulatory Commission (FERC) plays a key role in hydropower, interstate natural gas pipelines, and bulk electric transmission lines. For more on permitting these specific resources, see APPA’s issue briefs, “The Importance of Natural Gas for Electric Reliability and Affordability,” “Hydropower,” and “Electric Transmission Policies.” A clear definition of what constitutes “waters of the United States” (WOTUS) under the Clean Water Act (CWA) is necessary to facilitate streamlined permitting for energy infrastructure projects. WOTUS is a key definitional term that defines the extent to which a project impacting WOTUS may need a federal CWA permit. Electric utilities routinely secure permits for pollutant point source discharges to a WOTUS. Utilities use various water features to manage, store, and treat water. Any change in converting these industrial water features from non jurisdictional to jurisdictional will alter the point of compliance and create compliance issues, impose unwarranted new costs to public power utilities, and permit delays.

Also, under the CWA, the U.S. Army Corps of Engineers (Corps) can issue general permits to authorize activities with minimal individual and cumulative adverse environmental effects. The power sector relies extensively on these nationwide permits (NWPs) to provide timely and reliable installation of transmission and distribution powerlines and to perform maintenance on those lines, which are critical to their reliability. A streamlined NWP process supports the secure integration and delivery of a balanced mix of central and distributed energy resources.

Congressional and Agency Action 

The Infrastructure Investment and Jobs Act (IIJA)(P.L. 117-58) provides over $70 billion in energy infrastructure investment. It also includes provisions to streamline the NEPA review process for “major projects” funded by the act. Specifically, the IIJA requires: (1) that one agency lead the NEPA process for each project; (2) the creation of a joint project schedule; (3) the completion of the review process within two years; and (4) the production of a “record of decision” within 90 days of the issuance of a final environmental impact statement. Finally, the IIJA reauthorizes and amends parts of the Fixing America’s Surface Transportation Act to streamline the review of certain large infrastructure projects, including the Federal Permitting Improvement Steering Council.

Broadly speaking, Republicans have primarily been interested in reforming NEPA and judicial reforms that would streamline the federal permitting process for a variety of energy projects, while Democrats have been focused on reforms that would change how transmission lines are sited and paid for (cost allocation), with the goal of expanding the transmission system to accommodate increased renewable resources.

In early 2023, House Republicans introduced, and subsequently passed, an energy permitting bill, H.R. 1, the Lower Energy Costs Act. While primarily focused on fossil fuel and mineral production, it included language from the Building U.S. Infrastructure through Limited Delays & Efficient Reviews (BUILDER) Act, a bill introduced by Representative Garrett Graves (R-LA). The BUILDER Act sets statutory reforms to NEPA, including project threshold, interagency coordination, and review deadlines to prevent project delay, limits on what qualifies as a major federal action (which would trigger a NEPA review), and limits to prevent agencies from missing statutory deadlines. These reforms were all generally supported by public power and the electric sector. H.R. 3746, the Fiscal Responsibility Act (FRA), included the text of the BUILDER Act. House Democrats and the Biden administration initially tried to include transmission-permitting reform in this deal but eventually backed away to complete a budget deal. Both parties expressed a desire to continue to negotiate on additional permitting reform measures down the road.

To that end, in 2023, the Senate held several hearings on energy-permitting reform concepts and proposals to influence the permit reform debate further. The leaders of the Senate Energy & Natural Resources and Environment & Public Works Committees each introduced permitting reform legislation. In May 2023, APPA developed a “Permitting Reform Priorities” document to provide input for Senate hearings and guidance on draft legislative proposals.

Regulatory Action 

In response to the NEPA reforms contained in the FRA, the Council on Environmental Quality (CEQ) issued its Phase 2 proposed amendments to NEPA. The Phase 2 proposal includes extensive changes to current NEPA regulations. Some provisions are likely helpful, such as confirmation that effects must be “reasonably foreseeable,” requirements for deadlines and schedules for NEPA review, and allowing contractors (not just the federal government) to prepare environmental impact statements and environmental assessments. Other new procedures and policy elements could result in more complicated, time-consuming, and legally vulnerable NEPA reviews, such as the shift in perspective from NEPA as a procedural statute to one that is “action-forcing,” evaluation of alternatives outside of the action agency’s jurisdiction, and requirements to evaluate environmental justice and climate change effects at multiple stages of the NEPA process. APPA’s comments on the Phase 2 proposal encouraged CEQ to provide more details on the implementation and applicability of the FRA amendments, refrain from revisions of the purpose and policy sections in a way that shifts NEPA’s procedural requirements into an “action-forcing” statute with substantive requirements, expand the use of categorical exclusions, and remove the proposed provision that would allow the inclusion of alternatives not within the agency’s jurisdiction and the requirement to identify the environmentally preferable alternative.

Over the years, the courts, the Corps, and the Environmental Protection Agency (EPA) have struggled to develop a durable WOTUS definition. In January 2023, the Corps and EPA finalized the “Revised Definition of Waters of the United States,” which adopts a definition “founded” on the pre-2015 WOTUS definition (the 1986/88 regulations defining WOTUS) and updated to reflect their broad interpretation of multiple U.S. Supreme Court decisions and guidance. However, the rule is on hold in certain states due to ongoing litigation. Additionally, on May 25, 2023, the U.S. Supreme Court issued a decision in Sackett v. EPA (No. 21-454) limiting the scope of WOTUS under the CWA. The court found that the CWA extends to only those “wetlands with a continuous surface connection to bodies that are ‘waters of the United States’ in their own right,” so they are “indistinguishable” from those waters. The decision suggests that many of the provisions in the 2023 WOTUS rule are invalid and will likely require additional rulemaking or guidance.

FERC has also undertaken several actions that are likely to impact the siting and permitting of energy infrastructure. FERC is currently considering changes to its policies for evaluating interstate natural gas pipeline certificate applications under the NGA, including a greater focus on greenhouse gas emissions in NEPA reviews. FERC’s proposed policy changes have generated a great deal of uncertainty and opposition among natural gas companies and other key stakeholders. FERC has also proposed changes to its rules for regional electric transmission planning and cost allocation. While not specifically applicable to transmission siting and permitting, the perceived reasonableness of FERC’s rules governing transmission planning and cost allocation can have an impact on state and local decisions to permit and site new transmission facilities. FERC’s proposed rule changes include a mechanism to encourage joint ownership of transmission facilities. APPA has long believed that some of the obstacles to transmission permitting and siting could be mitigated if new transmission lines were jointly owned, with some partial ownership by public power utilities where feasible.

Separately, the IIJA revised and clarified FERC’s “backstop” siting authority for electric transmission facilities under section 216 of the FPA, which gives FERC authority to site electric transmission facilities in corridors designated by the Department of Energy if states do not or cannot act on transmission siting applications. APPA has supported FERC backstop siting authority and FERC recently proposed rules to implement the IIJA’s amendments to section 216.

APPA Contact 

Carolyn Slaughter, Senior Director of Environmental Policy, 202-467-2943 / [email protected]
Amy Thomas, Vice President, Government Relations, 202-467-2934 / [email protected]