Daniel Stephen

NEWS: 19 FORMER ECONOMIC AND NATIONAL SECURITY LEADERS ENDORSE THE BIPARTISAN PERMITTING REFORM BILL Today, a group of former Cabinet members and White House principals across seven Democratic and Republican administrations sent a letter calling on Congress to pass BAAJA. Here are the signatories: Janet YELLEN, Michael R. POMPEO, Steven T. MNUCHIN, Leon E. PANETTA, Timothy F. GEITHNER, Henry M. PAULSON, Jr., Robert E. RUBIN, Stephen MIRAN, Jared BERNSTEIN, Tyler GOODSPEED, Jason FURMAN, Glenn HUBBARD, Laura D’Andrea TYSON, Michael J. BOSKIN, Jeffrey ZIENTS, Jake SULLIVAN, Brian DEESE, Larry KUDLOW, Allan B. HUBBARD Key highlights from the letter: 1. “We are not building infrastructure fast enough to remain globally competitive… The median time for a new power plant to move from an interconnection request to commercial operation has more than doubled, from less than two years for projects built between 2000 and 2007 to more than four years for projects built between 2018 and 2024. 2. China has built more high-voltage transmission in the last fifteen years than the U.S. has built in all of its history... In 2024, China accounted for 31.5% of global knowledge- and technology-intensive manufacturing value added, compared with 20.7% for the United States. 3. Federally funded or permitted projects require NEPA review, but private projects often do not, creating a threat of failure precisely where the government is trying to be proactive, strategic, and engaged. 4. A project that spends years awaiting approval must continue carrying development and financing costs while remaining exposed to rising input costs. The IEA reports that prices for utility-scale transformers increased 26% in 2024, while lead times for some transformers have stretched as long as six years. 5. Mining projects also face tremendous uncertainty: a 2026 study by researchers at the Colorado School of Mines found that permitting for modern mining projects takes an average of 5.5 years, rising to 8.9 years for contested projects. The U.S. currently has the second-longest mine development timeline in the world. 6. The Bipartisan American Affordability and Jobs Act is the most significant bipartisan legislative effort that Congress has undertaken in decades to tackle these challenges. 7. BAAJA addresses key constraints stifling American industry by requiring interregional transmission planning, strengthening the federal backstop for nationally significant transmission lines, and creating a faster, more predictable process for connecting new generation to the grid. 8. BAAJA also makes permits more durable by imposing tighter timelines for litigation and limiting frivolous lawsuits that can halt projects indefinitely, while preserving community input and judicial review of substantive agency decisions.” The letter was organized by @arnabdatta321 on behalf of @IFP and covered exclusively by the WSJ this morning.

The "project certainty" title of the bipartisan permitting bill, BAAJA, was written to respond to the Trump Administration’s actions targeting renewables. However, some critics worried it would unduly limit a future administration’s ability to promulgate new regulations protecting public health or the environment, or inadvertently “lock in” the current administration’s energy policy. I have spent all day poring over this part of the manager’s amendment, released this morning. I’ve concluded the amendment’s changes should put to bed all but the most far-fetched concerns about such unintended consequences: 1. *Generally applicable regulations are not barred.* The original language raised concerns that protecting permits could also limit routine permit changes or new regulations as “interference” with a permit. The amendment adds an explicit exception for agency actions taken under applicable law or regulation, plus language preserving existing legal authority. 2. *A good faith mistake no longer can trigger a payout.* Originally, an agency that improperly interfered with a permit could owe 25–50% of project costs without any showing of bad faith. Now that extra award requires bad faith, a difficult standard to prove. 3. *Relatedly, permits denied lawfully in good faith cannot form a pattern of disparate treatment.* Section 1402 targets patterns of discrimination against particular types of energy projects. The original bill’s phrase “improperly denied” was worryingly vague. The amendment replaces it with “denied in bad faith.” This is a standard used in, e.g., APA record expansion claims. 4. *The government can explain any allegedly discriminatory patterns.* Critics understandably worried agencies could face liability based on statistics alone without being able to explain why approvals slowed or denials increased. The amendment expressly lets the government present evidence of a lawful reason for the pattern, such as a new legal public health measure aimed at reducing pollution and not “interfering” with a particular industry. 5. *Judicial "checks and balances" are required before any payments.* Critics identified some scenarios in which a friendly administration could intentionally interfere with a favored developer’s permit, with the purpose of subsidizing the developer. That already far-fetched scheme would now need to survive scrutiny by a federal judge. Settlements need specific court findings that they advance the section’s objectives and serve the public interest. 6. *Historical comparisons go beyond any one administration.* Section 1402’s baseline in the amendment expands from five years to ten. That makes it harder for a few years of hostility toward wind or solar to become the “normal” treatment against which future conduct is measured. 7. *No comparison between different project types or energy policy "lock in."* Many critics worried that the “baseline” of approvals – for instance, a percentage of renewable compared to fossil fuel projects – would need to continue in any future administration. That was not in the original bill, nor is it in the amendment. Comparisons are only between the rate of unreasonable delays or bad faith denials within a project category, not between categories. The amendment meaningfully responds to the strongest critiques and preserves ordinary regulation, distinguishes legal error from bad faith deliberate interference with a project or industry, and subjects payments to judicial scrutiny.