Energy Project Permitting: The New Nimbyism?
Should Washington overhaul the permitting process for energy projects of all stripes?
Many energy developers, including those for renewable energy and fossil fuels alike, complain about how long it takes for permitting officials to review projects, including wind farms, pipelines, and power plants. These long regulatory processes are caused by a confluence of factors, including local opposition (NIMBY, or not-in-my-backyard) and prolonged National Environmental Policy Act reviews.
Two recent examples illustrate these challenges. President Obama delayed the approval process for the Keystone XL pipeline last November because of local concerns in Nebraska about the project's impact on a major aquifer. That project has been winding its way through different regulatory processes for more than three years. Cape Wind, the offshore wind-farm project that is poised to be the country's first, has been slogging through the permitting process and beating back local opposition from powerful politicians like the late Sen. Edward Kennedy, D-Mass., for more than a decade.
Bipartisan legislation in the House would streamline environmental reviews of all types of energy projects, but it doesn't seem poised to gain much traction in the Senate.
Should Congress pass that measure, sponsored by Rep. Dennis Ross, R-Fla., or a similar one? What else should the White House and Congress do to more efficiently review energy projects? Or is the process operating as it should?

October 3, 2012 4:20 PM
By Don Santa
President, Interstate Natural Gas Association of America
The shale gas revolution has unlocked an abundant, affordable and environmentally friendly energy resource that is providing the United States with enormous economic and jobs benefits.
Pipelines make the natural gas revolution possible. Natural gas pipelines serve as the indispensable link between supply and markets. Given the growth in natural gas supplies in recent years, new gas infrastructure development is imperative.
The good news is that we have an efficient and effective legal and regulatory model to review, approve and site interstate natural gas infrastructure. This is due largely to decisions made by Congress in the 1930s and 1940s (and updated in 2005 as part of the Energy Policy Act) and the efforts of the Federal Energy Regulatory Commission in crafting and administering regulations under this legal framework.
The success of this legal and regulatory model can be seen in the over 15,000 miles of new natural gas transmission pipeline that have been constructed over the past decade.
The natural gas pipeline siting process, while good, is far ...
The shale gas revolution has unlocked an abundant, affordable and environmentally friendly energy resource that is providing the United States with enormous economic and jobs benefits.
Pipelines make the natural gas revolution possible. Natural gas pipelines serve as the indispensable link between supply and markets. Given the growth in natural gas supplies in recent years, new gas infrastructure development is imperative.
The good news is that we have an efficient and effective legal and regulatory model to review, approve and site interstate natural gas infrastructure. This is due largely to decisions made by Congress in the 1930s and 1940s (and updated in 2005 as part of the Energy Policy Act) and the efforts of the Federal Energy Regulatory Commission in crafting and administering regulations under this legal framework.
The success of this legal and regulatory model can be seen in the over 15,000 miles of new natural gas transmission pipeline that have been constructed over the past decade.
The natural gas pipeline siting process, while good, is far from perfect. Decisions by federal and state agencies responsible for issuing necessary environmental permits can significantly delay – and in some cases thwart –the construction of pipelines that FERC has found to meet the public need. In addition, some groups opposed to natural gas drilling now are targeting midstream infrastructure, such as pipelines and compressor stations, as a way to frustrate the development of natural gas resources.
Under its existing system for pipeline project approval, FERC evaluates a host of factors, including market need and the potential effects on landowners and the environment. It also has in place a rigorous input process, requiring public outreach meetings and numerous opportunities for the public as well as local and state officials to comment on the proposed project.
Because of this interactive process, very few pipeline infrastructure projects are approved and built as they originally were proposed to FERC. Instead, FERC examines route alternatives and requires a number of conditions, including environmental mitigation, post-construction reporting and compliance obligations, before granting its permission.
Even with one of the best infrastructure siting statutes available, natural gas pipeline projects still face delay. Because pipelines are so integral to allowing the U.S. to reap the enormous benefits of affordable domestic natural gas, we should look for ways to make this process even more effective.
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October 3, 2012 4:00 PM
Smart from the Start
By Jamie Rappaport Clark
President and CEO of Defenders of Wildlife
The way to resolve complaints about long delays for permitting energy projects is to do a better job of implementing the permitting process overall. That starts with doing a better job of planning projects and factoring in their broader social, economic and ecological costs upfront.
Let’s look at energy development as it currently occurs on public lands. For the most part, project proponents make extensive efforts to identify areas of high energy potential. Using this information, and information from land management agencies on available leasing or permitting sites, developers compete for or purchase sites where they believe the highest potential for energy development exists. As qualified buyers are identified, the process of permitting projects begins.
Under current practice, energy production potential is the primary factor that determines where projects should proceed. But, what if a similar effort were made in advance to assess and map these same landscapes to identify essential watersheds or key aquifers, important fish and wildlife resources, cr...
The way to resolve complaints about long delays for permitting energy projects is to do a better job of implementing the permitting process overall. That starts with doing a better job of planning projects and factoring in their broader social, economic and ecological costs upfront.
Let’s look at energy development as it currently occurs on public lands. For the most part, project proponents make extensive efforts to identify areas of high energy potential. Using this information, and information from land management agencies on available leasing or permitting sites, developers compete for or purchase sites where they believe the highest potential for energy development exists. As qualified buyers are identified, the process of permitting projects begins.
Under current practice, energy production potential is the primary factor that determines where projects should proceed. But, what if a similar effort were made in advance to assess and map these same landscapes to identify essential watersheds or key aquifers, important fish and wildlife resources, critical habitat for threatened or endangered species, areas of cultural importance to Native Americans, or of historical or recreational significance? Current permitting processes do require this kind of analysis, but this work is usually done as the permitting process proceeds, not in advance of determining whether or not the particular site is suitable for a project.
Managing for multiple uses – for water, wildlife, wild land, and cultural values -- is part of the legal mandate of public land management agencies. Unfortunately, the zeal to develop energy resources on public lands tends to trump these important values.
That is slowly changing as federal and state agencies and conservation groups conduct resource inventories and ecological assessments to determine what other critical values exist on the landscape. The importance of this information to help protect wildlife and natural resources is becoming more widely recognized as evidenced by the work of the Western Governors’ Associations’ Western Wildlife Habitat Council’s efforts to complete habitat assessments and identify key wildlife corridors. Federal agencies like the Bureau of Land Management, the US Geological Survey, and the Fish and Wildlife Service, and groups like The Nature Conservancy and NatureServ have produced similar information.
If the many ecological and cultural resource data bases that are now available were used to determine what parts of the landscape are important for “non-energy” resources in the same way that the energy potential of public lands is determined and mapped, we might reduce permitting costs by simply guiding energy projects to places where the least conflicts between environmental values and energy potential are. This is the essence of “smart from the start” planning. If we start with the goal of reducing the risk to projects by reducing the conflicts (and the risk) to wildlife and other environmental values, we believe that the costs of project permitting and development would go down substantially.
The Obama administration has proposed to guide utility-scale solar energy projects to solar energy zones and to encourage wind energy developers to use a risk assessment to better plan future wind energy projects. The wind guidelines are completed and training of wildlife officials, public land managers, and wind energy developers in their use is underway. We expect the final zone-based solar energy policy to be announced very shortly. This is real and exciting progress.
Real progress, though, will be made when energy development is planned in a way that permits land managers, project developers and other stakeholders to understand where environmental values and energy potential on a particular landscape are in conflict and provides the information needed to avoid, minimize or effectively mitigate that conflict before a large commitment of time and resources is made to the project. In fact, a greater commitment to use this information to plan jointly for energy and conservation objectives would be more consistent with the legal mandate to manage public lands for multiple values and benefits. In the end, this is the only way to achieve what we all seek – greater certainty that our conservation goals and energy needs are met more efficiently, at less cost, and in an environmentally-sound way.
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October 3, 2012 10:55 AM
Make Reviews Timely and Predictable
By Brigham McCown
Principal and Managing Director of United Transportation Advisors LLC
Americans broadly support the fair and impartial review of potential environmental impacts of major infrastructure projects. The question here is not whether or not we need to maintain such a process as embodied by the National Environmental Review Act (NEPA), but whether it needs to be updated to reflect the challenges of a rapidly changing world.
The proposed RAPID Act is a backlash against those who have twisted NEPA away from its original intent in order to hold projects hostage. RAPID could restore NEPA to its vision of protecting the environment AND promoting economic development at the same time as signed by President Nixon in 1970.
However, NIMBY residents have found common cause with BANANA (“build absolutely nothing anywhere near anything”) environmentalists and sympathetic politicians to stall crucial infrastructure projects. Currently, government agencies face no deadlines to approve or reject a project, giving opponents incentives to delay projects for as long as possible. Even after an agency lawfully approves a project, opponents can st...
Americans broadly support the fair and impartial review of potential environmental impacts of major infrastructure projects. The question here is not whether or not we need to maintain such a process as embodied by the National Environmental Review Act (NEPA), but whether it needs to be updated to reflect the challenges of a rapidly changing world.
The proposed RAPID Act is a backlash against those who have twisted NEPA away from its original intent in order to hold projects hostage. RAPID could restore NEPA to its vision of protecting the environment AND promoting economic development at the same time as signed by President Nixon in 1970.
However, NIMBY residents have found common cause with BANANA (“build absolutely nothing anywhere near anything”) environmentalists and sympathetic politicians to stall crucial infrastructure projects. Currently, government agencies face no deadlines to approve or reject a project, giving opponents incentives to delay projects for as long as possible. Even after an agency lawfully approves a project, opponents can still sue, leading to more uncertainty and higher costs.
Opponents are sometimes successful because they have no qualms raising the prospect of total environmental disaster for any project – even if the facts contradict their claims.
Using Keystone XL as an example, protestors point to the pipeline’s proposed crossing of a Midwest aquifer as cause to reject it. They claim that the pipeline would contaminate irrigation and drinking water for millions.
Opponents conveniently forget to mention that there are thousands of miles of pipeline already crossing the aquifer as illustrated by this map. Let us also not forget that the original Keystone pipeline also crosses the very same aquifer; but then again opposing pipelines had not yet come into vogue when it began operating in June of 2010.
Moreover, the federal agency responsible for pipeline safety has special, increased safety regulations, for the tens of thousands of miles of lines near ecological sensitive areas, including those in and around drinking and irrigation supplies.
Any NEPA reforms must minimize the opportunity for abuse. At the very least, we should impose time limits on review as the RAPID Act proposes.
There will always be pros and cons to each project. The key is to ensure that we balance the equally important priorities of environmental safety and economic growth in a way that is transparent to all involved. What we should not have is a process that allows a determined few to block projects on flimsy environmental claims, or politics disguised as such.
Combined with the current Administration’s policies that have hindered economic recovery, allowing important projects like Keystone XL to remain undecided after four and a half years is clear evidence of a system well out of balance.
The RAPID Act may not be perfect, but it is an attempt to re-balance the permitting process in order to reduce the uncertainty surrounding today’s projects. The question is whether leaders and members on both sides of the aisle will work together to improve the system?
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October 3, 2012 9:10 AM
NEPA Analysis Paralysis Kills Jobs
By Kathleen Sgamma
Vice President of Government & Public Affairs, Western Energy Alliance
NEPA has become an obstacle to economic development and job creation, with NIMBYism a favorite tool of obstructionist groups. In fact, without 179,000 categorical exclusions from NEPA, many “shovel ready” projects targeted for stimulus funding would still be undergoing analysis. Even more importantly, significant private-sector investment that doesn’t rely on taxpayer revenue is routinely prevented from growing the economy.
While the Keystone XL Pipeline is the latest well-known example of how NEPA analysis paralysis can kill job creation, there are many other examples across the country. In the West, the federal government is delaying the creation of about 65,000 jobs and $15 billion in annual economic impact as thirteen oil and natural gas projects undergoing NEPA languish for more than three years, with many over the seven year mark. All projects meet and exceed environmental requirements, with many companies proposing innovative solutions to mitigate impacts, but like Keystone, the political will to move these projects forward is lacking. Time and ...
NEPA has become an obstacle to economic development and job creation, with NIMBYism a favorite tool of obstructionist groups. In fact, without 179,000 categorical exclusions from NEPA, many “shovel ready” projects targeted for stimulus funding would still be undergoing analysis. Even more importantly, significant private-sector investment that doesn’t rely on taxpayer revenue is routinely prevented from growing the economy.
While the Keystone XL Pipeline is the latest well-known example of how NEPA analysis paralysis can kill job creation, there are many other examples across the country. In the West, the federal government is delaying the creation of about 65,000 jobs and $15 billion in annual economic impact as thirteen oil and natural gas projects undergoing NEPA languish for more than three years, with many over the seven year mark. All projects meet and exceed environmental requirements, with many companies proposing innovative solutions to mitigate impacts, but like Keystone, the political will to move these projects forward is lacking. Time and again, environmentally responsible development and job creation is not allowed to go forward.
The RAPID Act proposes many common sense solutions to make the NEPA process more predictable, including deadlines that allow projects to move forward, and measures to reduce the risk of litigation years after projects are underway. The Administration could do more immediately to reignite stalled NEPA processes that prevent jobs.
Regulation and environmental protection must always be balanced with economic development if we are to continue to enjoy a prosperous society that can afford to care for the environment. When environmentally responsible projects that could create tens of thousands of jobs are thwarted, the process is obviously broken and fails to achieve either goal.
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October 2, 2012 1:07 PM
D.C. should streamline permitting
By David Holt
President, Consumer Energy Alliance
For years, companies and individuals interested in tapping the nation’s natural resources for the betterment of its citizens have been mired in a never-ending fever swamp of local, state and federal permitting delays and uncertainty. The anecdotes and examples are endless and I will not recount them here. Suffice to say that when timelines stretch into multiple years for some projects, it’s time for regulators and lawmakers to take a step back and look for ways to create a more efficient process.
The problem is threefold.
First, companies report that the specific data and information required for permitting applications varies greatly and is clearly not subject to a single standard. The local offices of EPA, BLM, BOEM, and other regulatory agencies all apply the requirements of the National Environmental Policy Act, Endangered Species Act, Clean Air Act, et al. differently. This creates a moving target that is increasingly hard for companies to hit. Moreover, companies frequently report that upon final review by an agency, field staff will require addit...
For years, companies and individuals interested in tapping the nation’s natural resources for the betterment of its citizens have been mired in a never-ending fever swamp of local, state and federal permitting delays and uncertainty. The anecdotes and examples are endless and I will not recount them here. Suffice to say that when timelines stretch into multiple years for some projects, it’s time for regulators and lawmakers to take a step back and look for ways to create a more efficient process.
The problem is threefold.
First, companies report that the specific data and information required for permitting applications varies greatly and is clearly not subject to a single standard. The local offices of EPA, BLM, BOEM, and other regulatory agencies all apply the requirements of the National Environmental Policy Act, Endangered Species Act, Clean Air Act, et al. differently. This creates a moving target that is increasingly hard for companies to hit. Moreover, companies frequently report that upon final review by an agency, field staff will require additional information on an arbitrary basis. More frustrating is the fact that many times, agency staff declares that some of the work done by permittees never needed to be completed in the first place. None of these duplications and arbitrary requirements does anything to further environmental protection, and are nothing more than make-work provisions that drive up costs and lengthen timelines.
Second, many agencies are losing seasoned field staff, resulting in a loss of institutional knowledge and creating further confusion. New staff is increasingly unclear about requirements under the various laws and regulations creating further ambiguity sometimes from a single office. It is reported that many of the newest staff members lack the guidance needed to make decisions on the status of an application and that guidance from headquarters is slow or even inconsistent. This usually results in additional information requests and duplicative requirements as agency staff struggles to make a decision.
Third, this lack of a coherent strategy at the field level creates openings for lawsuits designed to halt development on federal land. Fear of lawsuits and lack of consistent guidance often prompts agency staff to require additional documentation or arbitrary application requirements. Ironically, when agencies fail to apply a single reporting requirement and regulatory standard they increase their vulnerability to lawsuits.
Ultimately, all of this confusion, ambiguity, duplication and delay mean higher prices for energy consumers, and a lack of progress on building and modernizing our energy infrastructure. And it does nothing to insure the current rules on environmental protection are enforced. It is simply bad and inefficient processes.
With new technology making unconventional resources suddenly feasible, our regulatory standards must keep pace with the industry and with demand. The Administration and Congress should work to clarify and simplify permitting processes, and mandate better cooperation among the various agencies responsible for overseeing development on federal lands.
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October 1, 2012 7:09 PM
NEPA Helps our Land, Energy & Wallets
By Chase Huntley
director of renewable energy, The Wilderness Society
Knowledge is power. And when it comes to energy development, understanding and preparing for the consequences of our actions improves the quality of decisions about how to best design projects and site developments, especially on our public lands. The public participation and open disclosure provided through the permitting process and National Environmental Policy Act reviews should not be side-stepped or shortcut through Congressional action. NEPA and other bedrock laws are vital elements of a policy that accounts for the views of local communities and key stakeholders, and makes public how these steps actually benefit communities and our energy economy. Embracing the opportunities provided by NEPA to look at where and how we develop energy is the surest way to achieve efficient and meaningful reviews.
Congress recognized the wisdom of protecting public health and the environment when it passed the National Environmental Policy Act (NEPA) with overwhelming bipartisan support more than 40 years ago. The law requires that before undertaking energy projects that may signific...
Knowledge is power. And when it comes to energy development, understanding and preparing for the consequences of our actions improves the quality of decisions about how to best design projects and site developments, especially on our public lands. The public participation and open disclosure provided through the permitting process and National Environmental Policy Act reviews should not be side-stepped or shortcut through Congressional action. NEPA and other bedrock laws are vital elements of a policy that accounts for the views of local communities and key stakeholders, and makes public how these steps actually benefit communities and our energy economy. Embracing the opportunities provided by NEPA to look at where and how we develop energy is the surest way to achieve efficient and meaningful reviews.
Congress recognized the wisdom of protecting public health and the environment when it passed the National Environmental Policy Act (NEPA) with overwhelming bipartisan support more than 40 years ago. The law requires that before undertaking energy projects that may significantly affect our air, water, social, cultural, and economic resources, federal agencies must assess the impacts of proposals, solicit the input of all affected stakeholders and disclose their findings publicly. The NEPA process has improved the health and well-being of communities, saved billions in tax-payer dollars, and unequivocally improved the quality of decision-making. NEPA’s common sense axiom is “look before you leap.” NEPA requires that agency decisions are transparent, grounded in rigorous scientific analysis, and fully informed by the collective expertise of all stakeholders.
NEPA recognizes that the public—which includes industry, landowners, local and state governments, tribes, and business owners among others—can make important contributions by providing unique expertise. Citizens, including local elected officials, across the country have engaged on energy projects at a very local scale. The opportunity to do so is a hallmark of our democratic system. Too often, reasonably foreseeable concerns are raised about energy projects late in the process and are painted as ‘not in my backyard’ opposition. Far from the source of roadblocks, NEPA and other public participation statutes actually offer a roadmap to avoiding conflict and controversy to anyone willing to listen. Upfront planning prevents conflict down the road, creating more certainty for industry and less litigation that slows development and increases costs.
Americans value our land, our wildlife, our air and our water and want to see to it that we guide projects to places with the least amount of impact on our local communities. That is something we at The Wilderness Society respect and applaud. We know we don’t have to choose between protecting these values and advancing America’s energy security. In our long history with energy development on public lands, we’ve seen that the best way to rapidly deploy renewable energy projects on our public lands is to end the scattershot approach to permitting that we see today. We can use existing law to move away from project-by-project permitting, and toward clear policies that guide companies to the right places, with early public engagement and consistent environmental review
The charge that environmental requirements are restricting the advancement of energy projects is a false premise, especially on BLM land.In 2010 the Bureau of Land Management adopted oil and gas leasing reforms aimed at developing a more efficient and smarter plan for permitting. Under previous administrations, the BLM routinely failed to resolve protests and issue leases in a timely fashion. Since the reforms were announced, however, the BLM has processed significant leasing backlogs in Utah and Wyoming and has resolved virtually every protest prior to lease sales. As a result, oil and gas companies are now receiving their leases within one or two months of lease sales.
When The Wilderness Society issued a report card on BLM’s leasing reforms recently, we found overwhelming improvement in the leasing process. We should let land managers and state and local officials continue to do the job needed and not allow more Washington bureaucracy and added congressional action to get in the way of processes that continue to show improvement at the agency level. The permitting for priority renewable energy projects initiated since 2009 took an average of 423 days, or 1.1 years to reach a final record of decision. This is well within other permitting time frames for similarly sized projects, and is remarkable given that these projects are unique in scale and complexity.
By identifying sensitive wildlife, lands, and cultural resources in the early planning stages of energy development, instead of during protests and litigation, we will improve permitting times, reduce risks for project developers and encourage citizen engagement in determining how best to site projects that protect important resources and fuel our economy. The National Environmental Policy Act is the way this is done and has been an important law for nearly half a century. It has led to smarter and safer energy projects. Building out energy resources, especially renewable energy, requires us to follow the simple goal of NEPA: do our homework first and make sure we get the project right the first time. After all, as the old adage goes, smart builders measure twice and cut once.
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October 1, 2012 6:50 PM
THE ELEPHANT IN THE ROOM
By Carl Pope
Former chairman and executive director, Sierra Club
America's environmental standards are, in some areas, pathetically weak. America's permitting processes are, in some cases, pathetically complicated and slow. How did we ever manage to get the worst of both worlds -- weak standards and enormously expensive bureaucracy?
Well, after 42 years of personal participation, observation, and perhaps some culpability -- from the moment of original sin, which was the Clean Air Act of 1970 -- I am compelled to say that our dilemma is neither inadvertent nor unavoidable. There were powerful interests in the business community that preferred weak regulations even at the price of slow permitting -- incumbnt companies that owned old facilities with outmoded and dirty technology. They didn't want to be forced to modernize, and as environmental regulation evolved, it didn't make them -- we "grandfathered" them. Instead, to satisfy citizen pressure to be able to stop NEW but dirty facilities, poiiticians layered in multiple opportunities for the organized to prevent new projects from obtaining approval. (Unorganized com...
America's environmental standards are, in some areas, pathetically weak. America's permitting processes are, in some cases, pathetically complicated and slow. How did we ever manage to get the worst of both worlds -- weak standards and enormously expensive bureaucracy?
Well, after 42 years of personal participation, observation, and perhaps some culpability -- from the moment of original sin, which was the Clean Air Act of 1970 -- I am compelled to say that our dilemma is neither inadvertent nor unavoidable. There were powerful interests in the business community that preferred weak regulations even at the price of slow permitting -- incumbnt companies that owned old facilities with outmoded and dirty technology. They didn't want to be forced to modernize, and as environmental regulation evolved, it didn't make them -- we "grandfathered" them. Instead, to satisfy citizen pressure to be able to stop NEW but dirty facilities, poiiticians layered in multiple opportunities for the organized to prevent new projects from obtaining approval. (Unorganized communities still get stuck with pollution -- it just takes longer for that hazardous waste dump to get a permit, but ti still gets one and it is still dirty. Natural gas drilling is banned in NY, but poorly regulated in West Virginia.
So we allowed dirty old facilities to go on like vampires, forever, but made it hard for new projects -- clean or dirty -- to get an answer, while ensuring that when dirty new projects did come along, they could eventually identify a poorly organized, or just plain poor community, and roll it, because the underlying substantive requirements were too weak, however many hearings had to be held.
Keystone is a good example. It is a project designed to reduce US access to Canadian oil, increase oil prices in the Midwest, and expose Americans to the substantial environmental risks of piping and refining tar sands bitumen. But there is no bright line standard that prohibits permitting a pipeline that will raise prices, reduce oil supplies and increase pollution -- none. Just long, long process at the end of which Keystone can bully or bribe public officials into saying "Yes."
Meanwhile, individuals who want to put solar panels on their own roofs have to wait in line to get permits.
This is insane. There is a theoretical fix -- innovative industries willing to do it right could partner with communities that want tougher standards, not longer delays, and create a permitting system that made sure that every industrial facility in the US, new and old, operates with state of the art environmental standards -- and that everyone applying for new permit knows that they will get it, quickly, but if and only if they demonstrate that they will provide a needed public product or service wtih the lowest possible health and environmental risk.
So far, no evidence however loudly business bemoans delay, that trade associations like the US Chamber really mean it when they say they want certainty -- if they did, they wouldn't be calling EPA's efforts to finally make the power industry modernize coal plants it pledged to clean up or retire back in 1977 war on coal!
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October 1, 2012 3:02 PM
Protect Local, Not Special, Interests
By William O'Keefe
CEO, George C. Marshall Institute
In recent years, technological advances and resource development have yielded new opportunities to increase energy production here at home. In fact, earlier this year the US exported more energy than it imported for the first time since 1949. Unfortunately, much of the progress that’s been made has been met with vocal cynicism, not only from concerned local citizens, but often from activist groups with their own agendas.
Two recent examples illustrate these challenges. This year President Obama delayed the approval process for the Keystone XL pipeline because of local concerns in Nebraska about the project’s impact on a major aquifer. That project had been winding its way through the regulatory process for more than three years. Cape Wind, the offshore wind-farm project that is poised to be the country’s first, has been slogging through the permittin...
In recent years, technological advances and resource development have yielded new opportunities to increase energy production here at home. In fact, earlier this year the US exported more energy than it imported for the first time since 1949. Unfortunately, much of the progress that’s been made has been met with vocal cynicism, not only from concerned local citizens, but often from activist groups with their own agendas.
Two recent examples illustrate these challenges. This year President Obama delayed the approval process for the Keystone XL pipeline because of local concerns in Nebraska about the project’s impact on a major aquifer. That project had been winding its way through the regulatory process for more than three years. Cape Wind, the offshore wind-farm project that is poised to be the country’s first, has been slogging through the permitting process and beating back local opposition from powerful politicians like the late Sen. Edward Kennedy (D-MA) for more than a decade.
All federal regulations should be reviewed periodically to determine if they are effectively serving their purpose and when possible, to revamp and streamline them. That happens too infrequently as does the effort to make them as clear and understandable as possible in the first place. Unnecessary complexity ensures that review processes for new opportunities will be slow and that law firms will get rich.
The Keystone pipeline fiasco and the slow permitting of fossil energy projects make clear that politics often trumps the rule making process. If three years of review was not sufficient to approve the Keystone Pipeline – a claim the Administration makes to rebut criticism its decision was a political one – then it’s obvious that the system is broken. It also is clear in the case of Keystone that Nebraska officials were not sufficiently involved early on. Opposition from one of the President’s major constituencies and the Administration’s own hostility towards the oil industry may have been larger obstacles that the rules themselves. That was also true of the Cape Wind Farm.
Having said that, it would be dangerous to pass a law that could further erode state and local rights. The process of claiming federal preemption on energy projects should not be easy. It should be used as a last resort and limited to situations that involve national issues rather than strictly local matters. How to do that without trampling states’ rights and property rights is a tough task.
Canada recently installed a new review process that is “one project, one review.” This takes the duplication out of national and provincial government reviews. According to the Canadian government: “The plan for Responsible Resource Development has four main pillars: more predictable and timely reviews; less duplication in reviewing projects; strong environmental protection, and enhanced consultations with Aboriginal peoples”. The new Canadian system sets specific timelines for hearings and review. It also consolidates the number of organizations responsible for review.
When considering our own regulatory review, policymakers should consider using the Canadian system as benchmark of measuring and improving our process. Given technological improvements, it ought to be possible to achieve much greater collaboration between the federal governments and states. There should also be incentives based on the performance record of the company requesting the permit. Companies that meet a predetermined standard of excellence should not have to jump through the same hoops as companies that have a poor operating and environmental records.
With any project, local concerns must be answered and we have to ensure there are proper precautions in place to protect residents’ and communities’ wellbeing. But by the same measure, policymakers need to ensure that the regulatory review process is effective enough that it can’t be hijacked by special interest groups to stifle important development that we need to continue moving the country forward.
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October 1, 2012 10:57 AM
By Rich Deming
Founding Partner, Power Resource Group and Shift Equity
There is an old story about LBJ that, facing a close election early in his career, he directed his campaign manager to spread the story that his opponent had been sleeping with barn animals. When his campaign manager objected that this was absurd, he replied “I know it is, but I want to see that SOB on TV denying that he sleeps with barn animals.”
I’ve been involved in great projects with technology—gasification—that is hard to understand, and I felt like that politician, explaining over and over that we were not proposing an incinerator, we did not want to poison rivers and children with dioxins, and that the flyers they had found on their porch with huge stacks billowing dirty smoke were from the 1950s and had nothing to do with our project. NIMBYism run amok is not a pleasant storm to endure.
As a renewable energy project developer, I would strongly support any streamlining of the permitting process for clean technologies. In the case above, an incredible project—repositioning a 600+ superfund site into an elegant system of industrial ecology—was b...
There is an old story about LBJ that, facing a close election early in his career, he directed his campaign manager to spread the story that his opponent had been sleeping with barn animals. When his campaign manager objected that this was absurd, he replied “I know it is, but I want to see that SOB on TV denying that he sleeps with barn animals.”
I’ve been involved in great projects with technology—gasification—that is hard to understand, and I felt like that politician, explaining over and over that we were not proposing an incinerator, we did not want to poison rivers and children with dioxins, and that the flyers they had found on their porch with huge stacks billowing dirty smoke were from the 1950s and had nothing to do with our project. NIMBYism run amok is not a pleasant storm to endure.
As a renewable energy project developer, I would strongly support any streamlining of the permitting process for clean technologies. In the case above, an incredible project—repositioning a 600+ superfund site into an elegant system of industrial ecology—was bullied and almost beaten. The project is back on track, but not without major delay and reconfiguration. I can’t resist listing some of the perspectives I gained from my year of living dangerously in NIMBY-land. I know that there are excellent reasons for a thorough environmental review and that often the little guy needs every tool to fight the power, but I’m going to leave those arguments for someone else and focus on what I know:
1. NIMBYism is often not what it appears to be. Reusing a waste product means taking away revenue from those who deal with waste. This plant would have eliminated a 10-year landfill contract worth tens of millions of dollars to a powerful multi-national corporation. It is not an issue of whether money of that size will defend itself, only of how. That huge contract was renewed when our project had to be reconfigured. Of course we cannot prove causation, only correlation; but the opposition was amazingly well-funded and organized.
2. A project development team will be portrayed with conflicted motives because money is involved, while the advocate fanning flames on the ground will be treated as a hero because he/she works for a non-profit. It should be noted that for those who make a career of non-profit advocacy, successfully closing down a project is the equivalent of getting a bonus. A “promotion” is usually soon to follow and was in this case.
3. Social media is a double-edged sword in NIMBY situations. Our opponents set up a “Stop XXXXXX” Facebook page and filled it with inaccurate information. When we engaged fully—I became somewhat obsessed with answering every charge late into the night—several former NIMBYs began to agree with and support us. The page was promptly taken down, and the other online venues—where allegations were printed without the ability to respond—gave a bad impression even to some of the neighbors.
4. The media flame NIMBYism; not because they are biased against projects, but because they are biased toward conflict and he-said, she-said stories. This isn’t a blind slam on journalism. I started my career there and can attest to this from personal experience. When you are on deadline, the path of least resistance is a story where the project developer says A, and the environmentalist says B. Objectivity is not finding the truth—there isn’t space or time to address the science—but leaving the reader to decide. The reader or viewer is going to listen to the loudest voice with the simplest message, thus enlarging the NIMBY population. In this case both sides thought the media was biased, so they probably did a pretty good job. But complexity is difficult in this environment.
5. Finally, as much as I hate to say it, a NIMBY explosion holds you to an extremely high standard. We did go back to the drawing board, and we came up with new technology and project planning that even unreasonable people have a hard time saying no to. So in a way, our opponents were sort of like that really tough teacher or professor who made you try harder. Actually more like that bully who made you more careful about how you walked home from school. Either way it sharpened our focus. But capital flows to the best return with the least resistance, so for other projects, the wounds can be fatal.
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October 1, 2012 6:23 AM
With Bipartisian Rhetoric for Permit Streamlining; We Now Need Bipartisan Action
By Bill Kovacs
Vice President for the Environment, Technology & Regulatory Affairs Division, U.S. Chamber of Commerce
Republicans, Democrats and the business community all agree that we should remove the red tape that slows down too many construction projects. By removing the permitting barriers to construction projects we begin building again and that creates jobs.
President Obama pledged to clean up red tape in his 2012 State of the Union address, and the President’s Council on Jobs and Competitiveness has called for strong action to simplify regulatory review and streamline project approvals.
There are millions of jobs that are never created because of a dysfunctional permitting system that allows for endless challenges and appeals on all issues no matter how minor.
In 2009, the Chamber launched the Project No Project initiative to highlight the broad range of energy projects across the country that are being significantly delayed or stopped due in large part to a broken permitting process. Project No Project discovered 351 new energy projects stalled by red tape that, if regulatory impediments were removed, could generate a $1.1 t...
Republicans, Democrats and the business community all agree that we should remove the red tape that slows down too many construction projects. By removing the permitting barriers to construction projects we begin building again and that creates jobs.
President Obama pledged to clean up red tape in his 2012 State of the Union address, and the President’s Council on Jobs and Competitiveness has called for strong action to simplify regulatory review and streamline project approvals.
There are millions of jobs that are never created because of a dysfunctional permitting system that allows for endless challenges and appeals on all issues no matter how minor.
In 2009, the Chamber launched the Project No Project initiative to highlight the broad range of energy projects across the country that are being significantly delayed or stopped due in large part to a broken permitting process. Project No Project discovered 351 new energy projects stalled by red tape that, if regulatory impediments were removed, could generate a $1.1 trillion short-term boost to the economy and create 1.9 million jobs annually during construction.
The Chamber’s initiative showed that an overly bureaucratic, calcified permitting process, when mixed with “Not In My Back Yard” activism, has blocked projects of all shapes and sizes through tactics such as organizing local opposition, changing zoning laws, opposing permits, filing lawsuits, and using other long delay mechanisms, effectively bleeding projects dry of their financing.
One of the most surprising findings is that it is just as difficult to build a wind farm in the U.S. as it is to build a coal-fired power plant. In fact, over 40 percent of the challenged projects identified are renewable energy projects. Often, many of the same groups urging us to think globally about renewable energy are acting locally to stop the very same renewable energy projects that could create jobs and reduce greenhouse gas emissions.
Congressman Dennis Ross, introduced the RAPID Act to provide a commonsense path for bringing projects from the application to construction. This legislation addresses the widespread problem that Project No Project identified: that project delays cost money and jobs.
The RAPID Act streamlines the process by:
First, requiring that for all National Environmental Policy Act (NEPA) reviews be managed by a lead agency that must provide notice to all other agencies with a stake in the outcome and offer these agencies a right to participate in the process.
Second, if an agency does not want to participate in the NEPA review process, it cannot at a later date raise concerns to delay the decision making.
Thirdly, time limits are imposed on the agencies to avoid the present mess of an almost limitless process.
Fourth, the statute of limitations for court review is shortened to six months from six years; again no one loses any rights, rather opponents of the project whether it be a federal agency or outside party must act on their rights within defined limits.
The House has acted in a bipartisan manner to pass the RAPID Act as part of comprehensive reform that simplifies a regulatory system that has been growing at a very rapid rate for decades. We urge the Senate to follow suit. The creation of millions of jobs is at stake. It is now time to stop the bipartisan rhetoric and take bipartisan action in the Senate.
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October 1, 2012 6:20 AM
Checks & Balances Core of U.S. System
By Scott Sklar
President, The Stella Group, Ltd & Adjunct Professor GWU
It is true that there are regulatory challenges that slow down energy projects at the federal, state and local government levels. These regulations and reviews are there for a purpose - to mitigate risk inherently tied to energy projects which can have huge ramifications. Republican and Democratic governors did not want the XL pipeline routed over the largest aquifers in the Unites States which feed major US food production. Major safety failures caused major oil spills in the Gulf of Mexico and the Exxon Valdez Alaska spill. A portion of San Bruno, California blew up due to major leaks in natural gas distribution lines underground and a hole found in a David-Besse nuclear reactor vessel resulted with the largest NRC fine ever. These regulations are not just to protect snail darters and endangered species but life and property that could hurt thousands of people and billions of dollars of damages. The checks and balances are the core of the American system where federal regulations effect interstate commerce and national security, state governments have regulatory prerogative, an...
It is true that there are regulatory challenges that slow down energy projects at the federal, state and local government levels. These regulations and reviews are there for a purpose - to mitigate risk inherently tied to energy projects which can have huge ramifications. Republican and Democratic governors did not want the XL pipeline routed over the largest aquifers in the Unites States which feed major US food production. Major safety failures caused major oil spills in the Gulf of Mexico and the Exxon Valdez Alaska spill. A portion of San Bruno, California blew up due to major leaks in natural gas distribution lines underground and a hole found in a David-Besse nuclear reactor vessel resulted with the largest NRC fine ever. These regulations are not just to protect snail darters and endangered species but life and property that could hurt thousands of people and billions of dollars of damages. The checks and balances are the core of the American system where federal regulations effect interstate commerce and national security, state governments have regulatory prerogative, and local governments on building codes and zoning control. While the politicians whine like kindergarteners and industry gnash their teeth for wanting their profits unencumbered -- the somber facts are we live in a complicated world full of risks. Unlike our political discourse, most decisions are not "black and white" but "shades of gray" balancing very important and diverse interests. These decisions require scientific review, transparent public review, national security and risk review, economic review, and finally health, safety and environmental review. None of these need to be stopped. Some can be streamlined - but solid review takes time. Balancing economic and safety interests need review and negotiation. Only when a tragedy happens the public wonders "how this can happen" and the politicians seek the culprits. And when the furor subsides, the whining for reducing regulations begins all over again.
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October 1, 2012 6:18 AM
NIMBYism is Democracy
By Tyson Slocum
director of Public Citizen's Energy Program
Electricity policy faces enormous challenges—three different federal agencies (EPA, DOE, FERC) and 10 Congressional committees wrestle with oversight over electricity markets, new generation sources, air and water emissions issues, and energy efficiency initiatives. Resolving the current political stalemate requires an acknowledgement that maximizing investment in a decentralized electricity structure has to be a significant part of policy going forward. And we must recognize that while constitutional rights within our Democratic Republic often clash with companies’ need for efficiency, preserving those rights must be our priority.
Not only are capital cost barriers of proposed new nuclear and coal-fired units significant, but so are the associated transmission infrastructure upgrades needed to move the power from new sources to population centers. Tryin...
Electricity policy faces enormous challenges—three different federal agencies (EPA, DOE, FERC) and 10 Congressional committees wrestle with oversight over electricity markets, new generation sources, air and water emissions issues, and energy efficiency initiatives. Resolving the current political stalemate requires an acknowledgement that maximizing investment in a decentralized electricity structure has to be a significant part of policy going forward. And we must recognize that while constitutional rights within our Democratic Republic often clash with companies’ need for efficiency, preserving those rights must be our priority.
Not only are capital cost barriers of proposed new nuclear and coal-fired units significant, but so are the associated transmission infrastructure upgrades needed to move the power from new sources to population centers. Trying to build any new type of large infrastructure system designed to accommodate our centralized power system has traditionally run into NIMBY opposition, which lately has been characterized as Not on Planet Earth (NOPE). Population density in the US has increased 105% from 1950 to 2010—from 42.6 people per square mile in 1950 to 87.4 people per square mile in 2010. With more people living per square mile than ever before, Americans’ Fifth Amendment Constitutional right to due process guarantees that large projects will continue to be delayed. Congress’ unwillingness to grant the Federal Energy Regulatory Commission ultimate authority over transmission siting leaves permitting at the state level, where property owners will continue to hold sway over project developers. Meanwhile, the plummeting cost of solar photovoltaics, advances in micro-wind turbines, and continued permitting successes of geothermal are providing more opportunities for distributed renewable energy generation. It’s more efficient to site millions of rooftop solar systems than permit just a handful of new coal/nuclear stations with hundreds of miles of needed transmission.
Some advocate eliminating our citizens’ constitutional rights in order to prioritize the development of energy projects. This is a terrible idea. For example, John Hofmeister, a former President of Shell Oil, wants to replace Congressional and Executive Branch authority with a federal reserve-type system of 14-year-term bureaucrats to make energy infrastructure and siting decisions. Replacing existing democratic institutions shouldn’t be taken lightly. Proponents of un-democratizing our institutions point to China as a model of energy infrastructure development. No doubt that US energy companies love China as a favorable environment to do business. When China built the Three Gorges Dam project and 1.13 million people were in the way, the Chinese government simply snapped its fingers and moved them. Lacking access to due process, private property and voting rights, Chinese citizens have no say whatsoever in the types of energy developments in their community. Thank God we live in a country that―so far― guarantees the rights of all citizens to exhaust their legal due process rights.
FERC Chairman Jon Wellinghoff promoted the idea of replacing centralized, baseload generation with small-scale, distributed renewable energy in an April 2009 interview: “We may not need any [nuclear or coal plants], ever…I think baseload capacity is going to become an anachronism. Baseload capacity really used to only mean in an economic dispatch, which you dispatch first, what would be the cheapest thing to do. Well, ultimately wind’s going to be the cheapest thing to do, so you’ll dispatch that first. People talk about, ‘Oh, we need baseload.’ It's like people saying we need more computing power, we need mainframes. We don’t need mainframes, we have distributed computing…So if you can shape your renewables, you don’t need fossil fuel or nuclear plants to run all the time. And, in fact, most plants running all the time in your system are an impediment because they’re very inflexible. You can’t ramp up and ramp down a nuclear plant. And if you have instead the ability to ramp up and ramp down loads in ways that can shape the entire system, then the old concept of baseload becomes an anachronism.”
America’s top energy regulator is right. The sooner we understand that the massive infrastructure needed to expand our centralized system cannot be built, the quicker we lay the foundation for the sustainable era of renewable energy.
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