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Are we getting closer to a viable permitting reform proposal?
At least one part is falling into place: This morning, Senator Catherine Cortez Masto and Senator Tom Cotton released a bipartisan bill that would keep future presidents from messing with already permitted energy projects. The House has already published its version, dubbed the FREEDOM Act — we scooped it in February — and now the Senate has had their go.
President Trump’s interference with onshore and offshore wind projects has made this kind of legislation a priority for Democrats, and I see its inclusion as essential to any kind of final permitting deal. Of course, Republicans have wanted to limit the executive branch’s interference with energy projects since President Joe Biden canceled the Keystone XL pipeline on the first day of his term. Harsh experience — or canny gamesmanship on the Trump administration’s part — has made permitting certainty a bipartisan priority. Lawmakers have come to recognize, too, that the government doesn’t need to revoke the permits for an energy project in order to effectively wage extrajudicial war on it — in other words, as George Michael might have sung, sometimes a “slow” can amount to a ban.
The new Senate bill makes a few key breaks with the House version. Most importantly, it jettisons a de-risking compensation program. In the original House version, developers would be eligible to receive up to $5 million in public funding if the government revoked a permit, missed a permitting deadline, or ran out the clock on a project. An agency that missed a deadline also faced stiff financial penalties.
That mechanism is now stripped from the bill. In the new Senate version, when a court decides a federal agency has waylaid a permit, it can appoint a court-approved contractor to finish the job. The bill establishes a new fund to pay for that contractor’s work, but it doesn’t fund the fees from agency penalties — and it doesn’t financially compensate developers.
There's one more change to the bill worth noting. The original House version of the proposal covered any project that would “develop, produce, generate, store, transport, or distribute energy” — great verbs! — as well as mineral and carbon capture infrastructure. The Senate adopts that definition in full, but adds that it covers projects on the “Outer Continental Shelf” — that is, offshore wind.
The FREEDOM Act doesn’t cover everything that I expect an eventual permitting reform bill would need to do, although it is getting closer. The bill’s final section, for instance, allows enhanced geothermal projects, like those developed by Fervo or Eavor, to benefit from the same exclusion from some federal rules that fracking wells already enjoy. Any final bipartisan effort will need to include transmission reforms and perhaps, as Republican Senator Mike Lee of Utah hopes, potential changes to federal historic preservation law.
But one thing I’d call out is Senator Tom Cotton’s cosponsorship of this bill. Cotton has become more of a presence on energy policy than I can remember from recent years.
He proposed a bill earlier this year that would allow data center developers to build their own independent power plants and transmission lines, provided they didn’t connect them to the grid. And he wrote a Washington Post op-ed in April tying the country’s failure to “build the physical foundations of power and defense” to its “broken permitting system.” He also cosponsored a partisan permitting bill back in 2020. But this is the first time I can remember the hard-right senator joining a Democrat to put out an energy-related proposal.
We’ll be tracking all that and more at Heatmap.
