Analysis by Energy Workforce President Tim Tarpley
Bringing potential new life into the prospect of a bipartisan permitting reform package this Congress, while speaking to the New York Stock Exchange on Monday, House Speaker Kevin McCarthy (R-CA-20) pushed for a package to ride with the “must pass” increase in the debt ceiling.
“It doesn’t matter what type of energy you love. Maybe you love wind and solar, you still can’t build it … How are we going to compete with other countries? I think if we attach that [permitting reform] to a debt ceiling [vote], growing our economy, that’s going to save us money in the long run. Among other things, this bill restores American energy leadership, makes it easier to build things in America, makes us less dependent on China and brings jobs back to America. That will grow our economy,” he said.
Tying permitting reform to U.S. competitiveness is a strong GOP talking point as the United States is now surpassing many of our allies in the time it takes to receive a permit for major energy infrastructure projects like gas pipelines.
The federal debt ceiling will likely need to be raised again sometime between July and September of this year depending on a number of variances in the financial modeling. This action is considered as a “must pass” piece of legislation, as without it the United States will no longer be able to meet its financial obligations once this date is passed. This is why that bill is an attractive target for any other pieces of legislation. It is a train that everybody knows will have to leave the station at some point.
Speaker McCarthy led his caucus to pass H.R. 1, the Republican marquee energy package that passed the House last month, which contains the BUILDER Act, a likely starting point of any negotiations on permitting reform at least on the Republican side. However, much negotiation must still take place in order for all of this to line up. The Senate is just beginning their work on a permitting reform package and ultimately a compromise will have to be reached with that body in order for a final package to pass both chambers. Attempting to tie the vote to the debt ceiling is a strategy the GOP can use to enact the most favorable language in any future compromise because GOP votes will be needed to pass any debt ceiling deal.
While McCarthy’s comments created a bit of a buzz around Capitol Hill and injected life into the prospect of passage, significant work still remains to be done. The truth is the parties remain fairly far apart on their overall priorities in any particular permitting reform package. Additionally, Senators on both sides of the aisle have also expressed some skepticism in linking permitting reform to the debt ceiling deal due to the fear of creating a precedent.
On Tuesday, Sen. Joe Manchin (D-WV) said during a meeting with the U.S. Chamber of Commerce that he would be reintroducing his permitting reform legislation soon and that he would take a serious look at the Republican package. He added he did not think it was correct for Senate Majority Leader Chuck Schumer (D-NY) to make public statements that the Republican bill was dead on arrival.
While the debt limit vote is a possibility, we must also remember it is entirely possible a permitting reform package could be passed as a stand alone or even become part of an end-of-year omnibus or other government funding package. Without permitting reform this Congress, it is very likely that many of the opportunities created by the Inflation Reduction Act will remain underused.
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.