Climate and environmental advocates are sharply divided over the Senate’s bipartisan permitting reform proposal. But what most people agree is that the bill’s changes to electricity and transmission law are really, really good — and in some sense are much better than expected.

Because of how the media works, that means nobody has talked about these proposals very much. So on this show, we wanted to focus on the part of the Bipartisan American Affordability and Jobs Act that has gotten rave reviews.

On this episode of Shift Key, Rob is joined by David Pomerantz, the executive director of the Energy and Policy Institute and a former Greenpeace campaigner. They discuss how the bill would rewrite electricity law, why the bill is bad for utilities, and why utilities are (in Dave’s view) such a problem for decarbonization.

Shift Key is hosted by Robinson Meyer, the founding executive editor of Heatmap News.

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Here is an excerpt from their conversation:

Robinson Meyer:
Will this decline in utility political clout continue, or is this limited to this moment? Then if [BAAJA] doesn’t pass, are utilities going to close ranks and there won’t be another chance to take on utility power again?

David Pomerantz:
That’s kind of the million-dollar political question, from where I sit. On the one hand, unfortunately for ratepayers and customers, I don’t see investors and utilities having, like, a sudden change of heart and doing the things that they could and should do to arrest inflation and lower people’s bills. I do want to make it clear, like, they could do that. There are a lot of things that utilities could do if they weren’t looking at their next quarterly returns and just sort of maxing cap-ex, to bring people's bills down. Like, you could see that on the public side of the sector. I don’t think they will. I think their incentives are too perverse. And because of that, I think they’re going to keep getting themselves into trouble politically by going for rate increases and bill increases. And so I see that, at least for the next couple of years, as being somewhat secular. Some of it, by the way, is actually not wrong, right? Like, the grid is aging, and they do need to spend money. That’s why it’s unfortunate that they’re not saving money where they can because they are kind of in a pickle there. So that part I see as sticking around at the same time on the other side of that argument.

I think one thing doing this work has taught me is that these companies have been around for over 100 years. If you read some of the history on some of the big political fights that investors and utilities were having in the 1930s, they do the exact same things now. They spent on propaganda. They route their money through trade associations. They recruit other parts of the political economy, like labor, to back them with politicians for whom that constituency is important. This is something EPI has really tried to investigate and highlight and ultimately address — they have, at the end of the day, a publicly subsidized pool of ratepayer money to spend on politics that almost no other industry has. And so I think they will regroup. Counting them out is probably a mistake.

You can find a full transcript of the episode here.

Mentioned:

The Senate’s Big Bipartisan Permitting Deal, Explained

The Senate Permitting Deal Contains a Data Center Double Tap

The Long, Strange Success Story of America’s Biggest Clean Energy Project

Previously on Shift Key: What a Permitting Reform Deal Could Look Like