Senate EPW Committee Holds Permitting Reform Hearing

WASHINGTON, D.C. - The Senate Environment and Public Works (EPW) Committee held a hearing to review the federal permitting process and identify opportunities for reform. U.S. Senator Kevin Cramer (R-ND) began by highlighting not "every transaction in this town requires a loser… we can have winners all around." He also stressed the federal government's misalignment of incentives. "In this case [permitting reform], we have an opportunity to line up all the incentives."

Cramer asked witnesses about the Clean Water Act Section 401 permits and the Trump administration's new Waters of the United States (WOTUS) proposed rule. While these permits are intended to protect water quality, activist states have weaponized the statute to block energy infrastructure. The Trump administration recently proposed a rule to narrow this regulation and bring it back in line with its statutory intent. Similarly, the U.S. Environmental Protection Agency (EPA) rewrote the WOTUS rule to reflect the Supreme Court's decision in Sackett v. EPA, providing much-needed clarity for infrastructure projects.

"It's definitely a step in the right direction and something that we're very supportive of," responded Dustin Meyer, Senior Vice President of Policy at the American Petroleum Institute. "But ultimately, it falls short of what we really need, which is a legislative fix to the way that Section 401 under the Clean Water Act has historically been weaponized, especially against interstate natural gas pipelines. So [we're] very supportive of it. It's a step in the right direction, but we need a lot more, and that's why it's such a high priority for us in comprehensive permitting reform."

"The reason [Business Roundtable] has been so focused for over a decade on bipartisan permitting reform legislation is because that's what's required for the results to be durable," said Brendan Bechtel, Chair of the Business Roundtable Smart Regulation Committee. "Executive actions are great, they're helpful, but of course, they could be unwound by the next administration."

Cramer highlighted experiences from his time serving as a North Dakota Public Service Commissioner and how early, frequent community involvement throughout the permitting process led to "great ideas from normal people." Similarly, he explained how the issue of transmission cost allocation policy is going to be a stumbling block unless some common ground is found between utilities, rate payers, and state regulators, asking witnesses how they would navigate this challenge.

"The cost allocation issue, I think there clearly needs to be some more flexibility provided to FERC, while respecting state jurisdiction and state roles," said David Terry, President of the National Association of State Energy Officials (NASEO). "One of the things that we have recommended at NASEO, to both our state members and the Department of Energy on this topic, is to make sure we have economic analyses that show the benefit to the states' consumers, not just from a rate perspective, the overall economic benefit. We think that there is something in that process to help inform the decisions, both the state regulators are making and federal regulators are making that go beyond rates to additional value that we see."