Statement for the Record, Hearing on “Opportunities to Improve Project Reviews for a Cleaner and Stronger Economy”

April 25, 2023

Dear Chairman Carper, Ranking Member Capito and members of the committee:

Thank you for your decision to hold a hearing on April 26, 2023, titled “Opportunities to Improve Project Reviews for a Cleaner and Stronger Economy.” My name is Philip Rossetti, and I am a senior fellow for Energy and Environment at the R Street Institute (R Street). I focus primarily on issues related to energy availability, security, affordability and its environmental impacts. In this context, the permitting of new energy projects has been a significant focus of mine.

I am writing to you today to furnish your committee with policy insight as to the importance of addressing permitting issues to lower energy costs and pollution in the United States. While permitting is an important step in providing public oversight of new construction, especially in the energy industry, data trends as well as industry anecdotes strongly suggest that the timeline for public approval of permits is significantly longer than Congress intended when it established permitting requirements. Delays in permitting new projects results in delayed entry of new energy providers to the market, which diminishes supply and increases prices. Additionally, since clean energy projects also require permitting—and often take longer to permit than fossil fuel projects—delays are likely to worsen air pollution by increasing reliance on older, more polluting incumbent sources.

In 2020, the Council on Environmental Quality (CEQ) released data which demonstrated how serious permitting delays have become for projects requiring the highest level of environmental review, an environmental impact statement (EIS).^[1] From 2010-2016, the median time from notice of intent (NOI) to a record of decision (ROD) increased from 2.3 years to 4.7 years, and the average time from 3.4 to 5.2 years.^[2] This significant discrepancy between median and average permitting timelines was because of the large share of projects requiring exceptionally long reviews, with roughly a tenth of projects requiring 10 years or more for review.^[3] Timelines were improved from 2017-2019, with an NOI to ROD median timeframe of 3.5 years and an average of 4.7 years.^[4] The extent to which this is attributable to the President Donald J. Trump’s changes in administration of permitting, or to the provisions of the Fixing America’s Surface Transportation Act’s Title 41 (FAST-41), is unclear.

Importantly, while the CEQ released data in 2018 and 2020, they have released no new data on EIS timelines since. As such, we do not have much clarity on current permitting timelines. One data source that is available, though, is the Federal Permitting Dashboard, which focuses on projects that receive special provisions for expedited permitting under FAST-41. A Brookings analysis of this data has found that even for these projects, EIS timelines commonly take around three years and have a significant range of between one and nine years to receive a permit.^[5]

Additionally, it should be noted that the idea that particularly dirty or egregious projects require longer timelines for approval and that clean ones are expedited appears to hold no merit. A 2021 analysis from R Street found that 42 percent of projects requiring an EIS or an environmental assessment from the Department of Energy found were for clean energy, transmission or conservation, while only 13 percent were for fossil fuel infrastructure.^[6]

Furthermore, an R Street analysis of Department of Interior projects in 2021 found a similar trend, where even though there were 8,904 fossil fuel projects requiring a National Environmental Policy Act (NEPA) decision and only 318 for renewable energy, only 0.3 percent of fossil fuel projects required an EIS while 12 percent of renewables did.^[7] Of the Bureau of Land Management’s current active projects requiring an EIS, there are 21 renewable energy projects and only five fluid mineral (oil and gas) projects.^[8] In addition, roughly two thirds of the projects on the Federal Permitting Dashboard currently are renewable energy.^[9]

While some would contest that perhaps these clean energy projects receive faster approval, Brookings’ analysis of the federal permitting dashboard found the opposite, with wind and electric transmission projects requiring the longest timelines—even longer than natural gas pipelines.^[10]

Overall, clean energy projects are just as, or more likely than, fossil fuel projects to require lengthy environmental reviews for public permits. While public discourse on permitting issues has frequently focused on fossil fuels versus clean energy, the data tells a different story, with permitting simply being an energy policy issue and not the problem of any one specific industry.

The reason for protracted timelines is something that is still debated, but litigation risk is a frequently cited reason for lengthened timelines, and data analysis supports this theory. A study comparing EIS preparation timelines and litigation defense found that agencies that take longer to prepare permits are more likely to win later court cases, and vice versa.^[11] Litigation risks incentivize agencies to take longer in their document preparation of permits.

Furthermore, increased litigation risk is not a result of projects being more likely to impact vulnerable communities or individuals. R Street analysis of the CEQ’s NEPA litigation data found that 59 percent of litigations against NEPA decisions come from public interest groups, while only 3 percent of plaintiffs are property owners and an additional 3 percent of plaintiffs are Native American tribes.^[12] The data suggest that most litigation risk comes from public or communal opposition to new construction, rather than any increased risk to communities presented by development. One article has even noted that much of the opposition to clean energy permitting comes, ironically, from conservation groups that oppose new infrastructure development that they view as environmentally destructive, even when it is for new clean energy.^[13] Incidentally, litigation risk is high because NEPA decisions are easy to challenge, and other commentary on NEPA litigation has pointed out that projects can be opposed out of plaintiffs’ self-interests, such as preservation of property value.^[14]

Overall, recent analysis on permitting issues reveals three key takeaways: one, permitting timelines are longer today than historically, which is delaying the entry of new energy providers to the market. Two, permitting delays do not selectively target specific industries, and ironically clean energy projects are more likely to be tangled in permitting delays than fossil fuels. And three, litigation risk is a major contributor to protracted permitting reviews, which is not correlated with any worsened outcomes to the public but rather the success of litigation from public interest groups in opposing infrastructure development.

Given that permitting delays are likely exacerbated by litigation risks, Congress has an opportunity to improve permitting timelines without having to modify environmental protections. A well-designed reform to permitting policy could result in accelerated deployment of clean energy and lower energy costs for Americans from all energy sources.

Thank you again for holding this important hearing and for your consideration of my views. Should you have any questions or wish to have further discussion, please do not hesitate to contact me.

              Sincerely,

             /s/
             Philip Rossetti
             Senior Fellow for Energy & Environment
             R Street Institute
             [email protected]

[1] National Environmental Policy Act, Database: EIS Timelines, Council on Environmental Quality, June 12, 2020. https://ceq.doe.gov/nepa-practice/eis-timelines.html.

[2] Philip Rossetti, “Addressing NEPA-Related Infrastructure Delays,” R Street Policy Study No. 234 (July 2021), pp. 3-5. https://www.rstreet.org/wp-content/uploads/2021/07/FINAL_RSTREET234.pdf.

[3] Ibid.

[4] Ibid.

[5] Rayan Sud et al., “How to Reform Federal Permitting to Accelerate Clean Energy Infrastructure: A Nonpartisan Way Forward,” Brookings, Feb. 13, 2023, p. 3. https://www.brookings.edu/wp-content/uploads/2023/02/20230213_CRM_Patnaik_Permitting_FINAL.pdf.

[6] Rossetti. https://www.rstreet.org/wp-content/uploads/2021/07/FINAL_RSTREET234.pdf.

[7] Philip Rossetti, “The Environmental Case for Improving NEPA,” R Street Institute, July 7, 2021. https://www.rstreet.org/commentary/the-environmental-case-for-improving-nepa.

[8] Bureau of Land Management, BLM NEPA Register, U.S. Department of the Interior, last accessed April 24, 2023. https://eplanning.blm.gov/eplanning-ui/search?filterSearch=%7B%22states%22:null,%22projectTypes%22:%5B8%5D,%22programs%22:%5B%22RENEWABLE_ENERGY%22,%22FLUID_MINERALS%22%5D,%22years%22:null,%22open%22:false,%22active%22:true%7D.

[9] Philip Rossetti, “Permitting reform is key for renewable energy, transmission and LNG exports,” R Street Institute, Sept. 20, 2022. https://www.rstreet.org/commentary/permitting-reform-is-key-for-renewable-energy-transmission-and-lng-exports.

[10] Sud et al., p. 9. https://www.brookings.edu/wp-content/uploads/2023/02/20230213_CRM_Patnaik_Permitting_FINAL.pdf.

[11] John C. Ruple and Kayla Race, “Measuring the NEPA Litigation Burden: A Review of

1,499 Federal Court Cases,” Utah Law Digital Commons (2019), p. 499. https://dc.law.utah.edu/cgi/viewcontent.cgi?article=1008&context=stegner_pubs. 

[12] Rossetti. https://www.rstreet.org/wp-content/uploads/2021/07/FINAL_RSTREET234.pdf.

[13] Wally Nowinski, “America’s Top Environmental Groups Have Lost the Plot on Climate Change,” Noahpinion, Jan. 14, 2022. https://noahpinion.substack.com/p/americas-top-environmental-groups.

[14] Jerusalem Demsas, “The Great Defenders of the Status Quo,” The Atlantic, March 16, 2023. https://www.theatlantic.com/ideas/archive/2023/03/national-environmental-policy-act-1970-nepa-regulation/673385.