Renewable Energy & Fossil Fuels battle Environmental Permitting

In the United States, we used to build fast! We no longer do. Despite the advances in built world technology, environmental permitting is constantly left holding the proverbial hot potato. It slows down project implementation, particularly for energy projects that impact natural resources and are therefore subject to environmental review. Regardless of the project type - whether it is a renewable energy project or a traditional energy project - if it’s disturbing natural resources, it will be subject to environmental laws and the subsequent environmental permitting that enables the operation to work.

A Shared Burden: Energy Companies Struggle with Environmental Permitting

As Americans, environmental protection is noble and necessary. We should protect our soil, water, air, plants, and animals in earnest, lest we fall into an anthropogenic narrative, covering up our stains and bruises of a bygone era of natural greatness. The old saying goes: the road to hell is paved with good intentions, but environmental protection is an area where we must be found pure of heart.

Unfortunately, our goal to conserve, protect, and enhance the natural resources that make America a natural global treasure is often overshadowed by bottlenecks and red tape that translate to time and politics. To find out why let's look back to President Richard Nixon. During his administration, we saw the promulgation of a host of environmental laws born out of half a century of unmonitored pollution.

• Factories dumping chemicals into rivers caused the Cuyahoga River in Ohio to catch fire in 1969, a startling wake-up call on the nightly news to the average American out of touch with environmental protection.
• Rachel Carson’s widely-read Silent Spring (1962) introduced our nation to the detrimental effects of pesticides.
• The 1969 Santa Barbara oil spill polluted beaches and killed wildlife up and down the southern California coast.

In response, President Nixon passed the most significant swathe of environmental legislation by executive order and Act of Congress of all presidents in American history. His sweeping legislative changes formed the nucleus of environmental permitting today. For example, the National Environmental Policy Act (NEPA) (Executive Order 11514), the Endangered Species Act (Executive Order 11911), and the National Historic Preservation Act (NHPA) (Executive Order 11593 ) are the three of the most critical federal environmental laws holding up the permitting process for traditional and renewable energy projects, each enacted into law on his watch. 

However, Nixon’s legislation, along with the multitude of subsequent federal and state environmental laws, rules, regulations, and policies were (and are still) often advocated for, articulated, drafted, and scripted into law without considering how the people will adopt, organize, implement, and follow the new law. It is a case of making an assumption and not testing it first. Theory versus practice. Ideas versus experience. Academics and politicians versus entrepreneurs, capitalists, and working people who make things happen every day.

The environmental permitting process by the federal or state government is not costly in and of itself. Instead, the process of clarifying the mixed bag of regulations and permits and securing clear definitive direction with an associated development project schedule is costly to produce. This cost is often defined by hiring environmental consulting firms to do the work for a development company. Or utilizing time, money, and human power within one's own company. This consumes time that would otherwise be used in securing and implementing the next project and its associated revenues. The actual cost is slowing business down and delays pursuing the next project rather than a linear line-item cost through permitting. It is time-consuming to determine what regulations are triggered and how to meet compliance, especially when some rules are so ambiguous that the Supreme Court lacks the skill to articulate absolute clarity of what procedures meet the law.

For example, four decades ago, Congress passed the Clean Water Act, the most crucial legislation regulating water pollution in United States history. Surprisingly, attorneys, legal scholars, and judges still grapple with the level of criminal intent the Clean Water Act requires. The Supreme Court continues to decline certiorari in a select group of important cases where it is unlikely that Congress and courts would clarify the ambiguity (until recently). Hence, environmental regulations are costly for many reasons, but securing clarity and defined steps on implementing a project remain ambiguous even for the brightest minds.

Environmental Protection vs Renewable Energy

Looking at the news, no one is surprised to learn that traditional energy projects are subject to considerable environmental permitting. However, clean energy projects impact land in the same manner as conventional projects and are subject to the same level of environmental review during implementation. This is true regardless of the renewable energy source.

Consider Biden’s clean energy goals: Biden's infrastructure plan calls for 800+ GW of new clean energy generation capacity, which will require land use equivalent to about the size of South Dakota, not to mention the thousands of miles of new transmission lines needed to facilitate this expansion of renewable energy technologies. While renewable energy development projects will reduce the effects of climate change over time, it is ironic and definite that one of the biggest obstacles to meeting Biden's clean energy goal will be the burden of the environmental permitting process. Not because the regulations themselves are the problem, but because the process is teeming with red tape, making it slow, expensive, and disruptive.

Environmental laws delaying environmental projects is only a new concept to folks who have never worked in environmental policy. Permitting delays have always been a problem for land development, and this situation is not unique to renewable energy development projects addressing climate change. The only difference is that it is clean energy’s turn to experience what traditional energy and other land development have encountered for years. For example, stream restoration projects that require the placement of large woody debris or other fill in a river to restore stream hydrology have always faced environmental permitting as the biggest roadblock. Similarly, Native American restoration programs that recover sensitive species populations for tribal ceremonies, diet, and ecological health have always faced environmental permitting as the most significant barrier to their success.

There will always be a palpable tension between building much-needed clean energy infrastructure to prevent the worst effects of climate change and protecting biodiversity and wild landscapes during our continual push for more renewable electricity and energy efficiency. Regardless of the theme, the same environmental laws, rules, regulations, and policies must be followed and will be the leading cause of delays in implementation. This equally applies to any infrastructure projects proposed in the Infrastructure Bill and possible Build Back Better plan. Federally funded or privately funded, all projects must follow the same ruleset and the associated timetable.

Whether you're racing to reduce emissions to provide environmental justice, ensuring public health and human safety through clean energy infrastructure projects, or implementing fossil fuel resources necessary for electricity generation needs, no single source can provide for all of Americans' various appetites for energy, and they all lose time and money through the current environmental regulation process. Think your offshore wind project is safe? These regulations apply even though you’re not building on land! No industry, project, or project developer gets a quick glide path through the quagmire of environmental regulations.

While Oil and Gas Companies Transition to Renewables, Their Environmental Permitting Problem Remains

The current administration advocates for energy from both the fossil fuel industry and renewable energy sources. One of President Biden’s boldest campaign promises was to end fossil fuel leasing on public lands and waters, an admirable yet lofty climate change law to transition the United States to net-zero carbon emissions. The federal government would no longer auction off the right to drill for climate-damaging oil and natural gas across the American West. He proposed that the federal government allow drilling on lands that oil and gas companies had already leased. A year after the election, that promise is far from being kept because the reality is: we need both. While the energy transition calls for a reduction in fossil fuels and carbon emissions, we still need natural gas and other traditional sources of energy today. Still, we encourage traditional energy companies to continue pursuing projects considering environmental impacts at the forefront of project planning.

Here’s a trend we love: Many oil and natural gas companies are setting net zero emissions targets. Climate change calls for an energy system transition from hydrocarbons to low-carbon renewable energy sources. Traditional energy companies, spurred by public pressure and sharp decreases in the value of their traditional fossil fuel assets, are looking for investment opportunities to reduce their emissions substantially. They are finding solutions in carbon dioxide capture, utilization, and storage (CCUS), purchasing renewable energy assets or partnering with solar power developers to build solar energy farms to power their oil fields.

For example, Chevron recently partnered with Sunpower to develop the 220-acre Lost Hills solar power plant adjacent to Chevron’s Lost Hills oil field in Kern County, California. The 29 MW plant will provide more than 1.4 billion kilowatt-hours of solar energy over the next 20 years to the field's production and processing facilities. ​​Upgrades to the electrical infrastructure will reduce the risk of sulfur hexafluoride (SF6) emissions, a potent greenhouse gas. The plant will export excess power to the grid to help offset night-time electricity purchases.

Regardless of the white hat nature of the effort, this project was subject to months of review under rigorous California environmental regulations, including the California Environmental Quality Act (CEQA) and California Endangered Species Act (CESA) permitting (for impacts to local protected species like the San Joaquin kit fox). This and others like it will continue to be subject to environmental laws and the subsequent environmental permitting timetables that enable the operation to work.

How Can Government Help Speed Up the Permitting Process and Still Protect the Environment

To meet our nation's aggressive climate goals, the Environmental Protection Agency (EPA) will have to take steps to encourage clean energy infrastructure development by introducing thoughtful changes to the federal environmental review process. Past and current administrations have attempted to revise the National Environmental Policy Act (NEPA), which is the driving regulation behind most environmental permitting processes. While they may find temporary success, recent history shows that it is all but certain that the next administration will undo the work done in the current.

If we could rub the magical NEPA lamp and have three wishes granted by the Genie of Environmental Red Tape, here’s what they would be:

1. NEPA page limits;
2. More Categorical Exclusions for repeat actions, and
3. Tiering the previous environmental review processes that are completed rather than starting from the beginning for expanding projects.

If we got a bonus wish, we’d ask for a doozie (though it might be as impossible as bringing someone back from the dead): paramount to a streamlined permitting process is to centralize the governing authority. Right now, rules and regulations are housed in so many different agencies, offices, and jurisdictions that each have various missions, training, staffing, and business cultures. It is a miracle the environmental review process works at all (some would argue it never has). Not only does this prevent a project developer from achieving one-stop shopping (physically or electronically), but the interpretation by each agency is the equivalent of a different lingual dialect.

What Can Energy Companies do to Speed Up the Permitting Process and Still Protect the Environment

Despite the red tape, the sun will continue to shine on renewable energy development due to the climate crisis. Seventy-nine percent of Americans think that the United States should prioritize developing renewable energy technology. Public sentiment can do wonders for the clean energy movement to combat global warming. However, some solar energy or wind power projects may still struggle to win over local communities and city councils weary of land use changes to historically agricultural lands. 

Clean energy projects that look to proactively limit environmental permitting and public comment must avoid and minimize environmental impacts. Avoidance and minimization are the critical pillars of most environmental policies in the United States. In a 2015 presidential memo titled Mitigating Impacts on Natural Resources from Development and Encouraging Related Private Investment, former President Barack Obama confirmed to all United States federal agencies that “It shall be the policy…. to avoid and then minimize harmful effects to land, water, wildlife, and other ecological resources (natural resources) caused by land- or water-disturbing activities….” Later, he recommends that “large scale plans and analysis should inform the identification of the areas where development may be most appropriate, where high natural resource values result in the best location for protection and restoration….”

In the race to meet clean energy mandates and cut greenhouse gas emissions, land lease and buying decisions for new renewable energy developments are being made at an unsustainably fast pace, with developers often committing to a piece of land without any consideration of the eventual environmental impact or permitting timeline. However, the developer who takes a moment to seek out a reliable resource that can quickly evaluate avoidance and minimization strategies and identify the expectations for environmental review will be rewarded with a project delivered on time and within budget. Any project developer, including those in clean energy, will find that most often what’s good for the environment is also good for business.

Evaluating and understanding your environmental risk earlier in the process is key to making the right purchasing decisions and appropriately planning your environmental permitting process. Transect allows for early-stage environmental due diligence, so you are never in the dark.