Permitting Reform Outlook, Based on Provisions from Debt Ceiling Compromise

Efforts to pass federal permitting reform heated up in the previous Congress and continue to be a top priority, with Republicans in the U.S. House of Representatives kicking off their agenda with the Lower Energy Costs Act (H.R. 1). Permitting reform legislation has been introduced by the House majority as well as in the U.S. Senate, where a number of bills have been put forward, including:

• Promoting Efficient and Engaged Reviews (PEER) Act, introduced by Sen. Tom Carper (D-Del.), Chair of the Committee on Environment and Public Works
• Revitalizing the Economy by Simplifying Timelines and Assuring Regulatory Transparency (RESTART) Act, introduced by Sen. Shelley Capito (R-W.Va.), Ranking Member of the Environment and Public Works Committee
• Building American Energy Security Act of 2023, introduced by Sen. Joe Manchin (D-W.Va.), Chair of the Committee on Energy and Natural Resources
• Spur Permitting of Underdeveloped Resources (SPUR) Act, introduced by Sen. John Barrasso (R-Wyo.), Ranking Member of the Energy and Natural Resources Committee

With the inclusion of permitting reform provisions – including language accelerating approval of the Mountain Valley Pipeline – in the debt ceiling compromise, the regulated community is questioning whether these reforms have any substantial impact on the future of a broader permitting reform effort.

Finding a Compromise

In talks with a variety of offices on Capitol Hill, a consensus emerged that the debt ceiling deal didn't really change the interest in passing a more comprehensive permitting reform bill. Despite continued interest, the fundamental issues keeping permitting reform from happening still remain, and either side still questions if their counterparts are willing to cut the necessary deals to get compromise reform over the finish line.

Both Republicans and Democrats know the universe of provisions, dials and levers that can be pulled. The problem has been finding a compromise to which both sides are amenable. Democrats will have to give up their opposition to permitting reform in general to get broader deployment of renewables and realize the full potential of the Inflation Reduction Act (IRA). Republicans will have to accept they will not get all of the reforms they would like and that the likelihood of revisiting anything that is left on the cutting room floor any time in the near future is highly unlikely. In short, members who have pushed a provision for years will have to accept that if it's not in this package, it may not happen. This is the same place the debate was last Congress and the same place they were in pre-debt ceiling. One obvious difference is the loss of leverage Democrats will have in ongoing negotiations with the Biden Administration approving the Mountain Valley Pipeline in the debt ceiling legislation. However, that does not change their desire to find a transmission compromise and ensure that permitting is not hindering spending authorized in the IRA and Infrastructure Investment and Jobs Act (IIJA).

Looking Forward

What this means is that, just like before, if a compromise can be reached, things could move quickly. Leaders from the Environment and Public Works as well as Energy and Natural Resources Committees met this week and reiterated their support for moving permitting reform language this year. It is highly unlikely, even if they reached a deal tomorrow, they could move legislation through the committees, get it on the Senate floor and pass it before August 2023. Even then, a conference is needed to get it to the president's desk. Therefore, the likelihood of real action (outside of the committees) happening before September 2023 is unlikely.

However, significant action is possible in fall 2023. While Sens. Manchin and Capito – who still strongly support permitting reform – had their top priority included in the debt limit deal, Democrats' top priority was left unaddressed. Republicans undoubtedly would like to do more, as would many in the White House. This issue is not going away, but realistically, language included in the debt limit makes a quick compromise less likely and could create some new complications for negotiating overall permitting efforts.

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