A specter is haunting permitting reform talks — the specter of regulatory uncertainty. That seemingly anodyne two-word term has become Beltway shorthand for President Donald Trump’s unrelenting campaign to rescind federal permits for offshore wind projects. The repeated failure of the administration’s anti-wind policies to hold up in court aside, the precedent the president is setting has spooked oil and gas executives, who warn that a future Democratic government could try to yank back fossil fuel projects’ permits.
A new bipartisan bill set to be introduced in the House Tuesday morning seeks to curb the executive branch’s power to claw back previously-granted permits, protecting energy projects of all kinds from whiplash every time the political winds change.
Dubbed the FREEDOM Act, the legislation — a copy of which Heatmap obtained exclusively — is the latest attempt by Congress to speed up construction of major energy and mining projects as the United States’ electricity demand rapidly eclipses new supply and Chinese export controls send the price of key critical minerals skyrocketing.
Two California Democrats, Representatives Josh Harder and Adam Gray, joined three Republicans, Representatives Mike Lawler of New York, Don Bacon of Nebraska, and Chuck Edwards of North Carolina, to sponsor the bill.
While green groups have criticized past proposals to reform federal permitting as a way to further entrench fossil fuels by allowing oil and gas to qualify for the new shortcuts, Harder pitched the bill as relief to ratepayers who “are facing soaring energy prices because we’ve made it too hard to build new energy projects.”
“The FREEDOM Act delivers the smart, pro-growth certainty that critical energy projects desperately need by cutting delays, fast-tracking approvals, and holding federal agencies accountable,” he told me in a statement. “This is a common sense solution that will mean more energy projects being brought online in the short term and lower energy costs for our families for the long run.”
The most significant clause in the 77-page proposal lands on page 59. The legislation prohibits federal agencies and officials from issuing “any order or directive terminating the construction or operation of a fully permitted project, revoke any permit or authorization for a fully permitted project, or take any other action to halt, suspend, delay, or terminate an authorized activity carried out to support a fully permitted project.”
There are, of course, exceptions. Permits could still be pulled if a project poses “a clear, immediate, and substantiated harm for which the federal order, directive, or action is required to prevent, mitigate, or repair.” But there must be “no other viable alternative.”
Such a law on the books would not have prevented the Trump administration from de-designating millions of acres of federal waters to offshore wind development, to pick just one example. But the legislation would explicitly bar Trump’s various attempts to halt individual projects with stop work orders. Even the sweeping order the Department of the Interior issued in December that tried to stop work on all offshore wind turbines currently under construction on the grounds of national security would have needed to prove that the administration exhausted all other avenues first before taking such a step.
Had the administration attempted something similar anyway, the legislation has a mechanism to compensate companies for the costs racked up by delays. The so-called De-Risking Compensation Fund, which the bill would establish at the Treasury Department, would kick in if the government revoked a permit, canceled a project, failed to meet deadlines set out in the law for timely responses to applications, or ran out the clock on a project such that it’s rendered commercially unviable.
The maximum payout is equal to the company’s capital contribution, with a $5 million minimum threshold, according to a fact-sheet summarizing the bill for other lawmakers who might consider joining as co-sponsors. “Claims cannot be denied based on project permits or energy technology type,” the document reads. A company that would have benefited from a payout, for example, would be TC Energy, the developer behind the Keystone XL oil pipeline the Biden administration canceled shortly after taking office.
Like other permitting reform legislation, the FREEDOM Act sets new rules to keep applications moving through the federal bureaucracy. Specifically, it gives courts the right to decide whether agencies that miss deadlines should have to pay for companies to hire qualified contractors to complete review work.
The FREEDOM Act also learned an important lesson from the SPEED Act, another bipartisan bill to overhaul federal permitting that passed the House in December but has since become mired in the Senate. The SPEED Act lost Democratic support — ultimately passing the House with just 11 Democratic votes — after far-right Republicans and opponents of offshore wind leveraged a special carveout to continue allowing the administration to commence its attacks on seaborne turbine projects.
The amendment was a poison pill. In the Senate, a trio of key Democrats pushing for permitting reform, Senate Energy and Natural Resources ranking member Martin Heinrich, Environment and Public Works ranking member Sheldon Whitehouse, and Hawaii senator Brian Schatz, previously told Heatmap’s Jael Holzman that their support hinged on curbing Trump’s offshore wind blitz.
Those Senate Democrats “have made it clear that they expect protections against permitting abuses as part of this deal — the FREEDOM Act looks to provide that protection,” Thomas Hochman, the director of energy and infrastructure policy at the Foundation for American Innovation, told me. A go-to policy expert on clearing permitting blockages for energy projects, Hochman and his center-right think tank have been in talks with the lawmakers who drafted the bill.
A handful of clean-energy trade groups I contacted did not get back to me before publication time. But American Clean Power, one of the industry’s dominant associations, withdrew its support for the SPEED Act after Republicans won their carveout. The FREEDOM Act would solve for that objection.
The proponents of the FREEDOM Act aim for the bill to restart the debate and potentially merge with parts of the previous legislation.
“The FREEDOM Act has all the critical elements you’d hope to see in a permitting certainty bill,” Hochman said. “It’s tech-neutral, it covers both fully permitted projects and projects still in the pipeline, and it provides for monetary compensation to help cover losses for developers who have been subject to permitting abuses.”
