Analysis by Energy Workforce President Tim Tarpley
Over the weekend, Speaker Kevin McCarthy and President Biden reached a tentative deal to raise the federal debt limit along with a number of policy provisions included in the bill. The House passed the measure, and now both sides are working their respective caucuses to solicit adequate support to pass the bill in the Senate, his week.
The tentative agreement will lift the debt ceiling for two years to 2025, avoiding an election year standoff. It also caps non-defense spending to roughly current fiscal year levels for 2024 and increases it by 1% in fiscal year 2025. It includes many of the work requirements for government assistance that Republicans have been pushing in an effort to slow spending.
Of significant importance to our sector, is the package contains many of the key provisions from the Building U.S. Infrastructure through Limited Delays and Efficient Reviews (BUILDER) Act, introduced by U.S. Rep. Garret Graves (R-La.) that passed in the House of Representatives as a part of H.R. 1, the Lower Energy Costs Act. While not all of the provisions that we have been watching appear to be in the most recent version of the deal, there are some significant changes to the National Environmental Policy Act (NEPA) which Energy Workforce strongly supports, as they will expedite federal action on energy infrastructure projects if enacted.
Of particular interest is that the legislation implements the “One Federal Decision” framework for all projects that must undergo NEPA review, which means that the lead agency for a particular project would set a permitting schedule and use a single document for environmental reviews when a project involves multiple agencies. Along these same lines, the draft agreement would set time limits of one year for environmental assessments and two years for environmental impact statements and provide a legal right of action should an agency not follow the timeline. Agencies would be able to adopt categorical exclusions utilized by other agencies through a streamlined and expedited process. The bill would also clarify the definition of a “major federal action” under NEPA, including a list of actions that do not qualify as a “major federal action.” While these provisions are clearly a step forward, and Energy Workforce supports passage, it is our hope that an additional comprehensive permitting reform package will be possible later in the year. Litigation reform is also a key element we want to have included in a more robust permitting reform package.
Another provision that Energy Workforce has long pushed for is expedited permitting for the Mountain Valley Pipeline. The language in the bipartisan agreement would approve all the remaining permits to complete the stalled Mountain Valley Pipeline which has long been pushed by West Virginia Senators Joe Manchin and Shelley Moore Capito. The project has long been a target by those opposed to new fossil fuel infrastructure but is much needed to move gas out of the Marcellus and through West Virginia to a region that has growing demand for gas.
It is important to remember that the deal is still tentative until both chambers pass on the same legislation, and at the time of writing it is still possible that further changes will be necessary in order to ensure enough votes to pass the Senate. Speaker McCarthy faced a rebellion by some within the Freedom Caucus for (in their opinion) not achieving more concessions in the deal. However, at the end of the day, the Speaker was able to make up the losses in his caucus in the House with Democratic yes votes. The Senate may be a bit of a closer vote later this week, but it is still expected to pass and ultimately be signed by the President. Lawmakers must raise the debt ceiling before June 5th in order to avoid a potential debt default and bring about the necessity of the Treasury Department having to prioritize federal payments.
Tim Tarpley, Energy Workforce President, analyzes federal policy for the Energy Workforce & Technology Council. Click here to subscribe to the Energy Workforce newsletter, which highlights sector-specific issues, best practices, activities and more.