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Transmission trouble: Pipeline woes presage obstacles for clean energy build-out

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Electricity pylons stand against the sunset in Enterprise, Ore.

Source: Pete Saloutos/Getty Creative via Getty Images

President Joe Biden's $2 trillion plan for the U.S. economy includes a renewable energy infrastructure build-out expected to help target carbon-free electricity by 2035 and net-zero economywide emissions by 2050. But the decarbonization goals may not keep clean energy projects from facing the same headwinds that recently upended the oil and gas pipeline industry under the pro-fossil-fuel Trump administration.

"People hate infrastructure; it really doesn't matter what it is," Katie Bays, managing director at FiscalNote Markets, said in an interview. "If you are building a wind facility on sage grouse habitat, you are going to have just as many people freaking out about that as there are about Mountain Valley [pipeline]."

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Pipeline project opponents in recent years found ways to require more environmental analyses under the National Environmental Policy Act, or NEPA, which also have the effect of delaying projects and driving up costs.

Environmentalists also found natural allies among indigenous groups and landowners, while states such as New York began to realize they could stop projects through state permitting reviews under the Clean Water Act or through eminent domain challenges.

During 2020, major legal setbacks forced Dominion Energy Inc. and Duke Energy Corp. to cancel their Atlantic Coast natural gas pipeline project and Williams Cos. Inc. to scrap its Constitution gas pipeline project, as the Equitrans Midstream Corp.-led Mountain Valley Pipeline LLC faced additional delays.

According to renewable industry researchers, analysts and legal experts, green transmission projects also face serious permitting obstacles that come with building interstate infrastructure in the U.S.

Opponents to renewables infrastructure projects may be able to deploy some of the same legal tactics that upended the pipeline sector to hold up development, experts said, pointing to cases such as the Vineyard Offshore Wind Project in Martha's Vineyard that has faced delays amid resistance from commercial fishermen.

"This is going to be a big challenge," Leah Stokes, an assistant professor at the University of California at Santa Barbara who has studied opposition to wind projects, said in an interview. "A lot of it is grassroots NIMBYism, but there's no reason why a trade association or industry can't bolster that and make it bigger if it serves their interest."

Similar bottlenecks

Similar to the way environmental groups have litigated pipelines' Federal Energy Regulatory Commission certificates in the U.S. District Court for the District of Columbia, landowners opposed to interstate renewable transmission projects are looking to state courts to overturn public utility commission approvals.

In Missouri, for example, opponents continue to fight Invenergy Transmission LLC's Grain Belt Express even after the state supreme court upheld the Missouri Public Service Commission's 2019 approval of the project. The line would run roughly 780 miles from western Kansas, through Missouri and Illinois, and into Indiana. The Missouri Farm Bureau and other groups contend that Grain Belt Express does not qualify for power of eminent domain since it is neither a public utility nor an electrical corporation.

"We are advocating statutory changes to try to address what we think were some misinterpretations of current law," Missouri Farm Bureau senior director of regulatory affairs Leslie Holloway said in an interview. "This is strictly a business transaction where wind power coming out of Kansas will be transmitted across states to the East Coast, which is all well and good, but the point is this is not what eminent domain power should and has been used for."

While regulators in Kansas and Indiana have also signed off on the project that would deliver largely wind-generated power to customers in Kansas, Missouri and states further east, an Illinois appellate court in 2018 reversed the state commission's approval. Still, the Invenergy LLC subsidiary plans to begin construction prior to Illinois regulatory authorization.

Stokes said protests against wind projects have been uncommon but stand to become a much more prominent issue given the scale of the build-out required to meet climate targets.

"There are really real trade-offs as we get to higher and higher penetrations of clean energy, and I'm a huge clean energy advocate, but this is a real issue that's coming down the pike," Stokes said.

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A recent study out of Princeton University's Andlinger Center for Energy and the Environment called for the U.S. to expand its electricity transmission by 60% by 2030 and warned that it might need to triple in size by 2050 to reach net-zero carbon emissions by that date.

Among the bottlenecks that study authors listed as needing "immediate attention" were community opposition to infrastructure and ensuring regulators can review and issue permits in a timely manner.

The recent history of developing long-haul pipelines in the U.S. demonstrates what can happen when those bottlenecks go unaddressed, according to Justin Gundlach, a senior attorney with New York University School of Law's Institute for Policy Integrity.

"You would absolutely see people who don't like transmission lines use NEPA to say that the agency responsible for siting this transmission line has failed to take the requisite hard look at the impacts, etc., etc. — no question," he said in an interview.

In Maine, a 1,200-MW transmission line that would deliver Canadian hydropower to New England has faced a cross-section of project opponents, including the Sierra Club, landowners, and fossil fuel-fired power generators. Central Maine Power Co. is developing the line with Avangrid Inc. Running the line through Maine was a backup plan, after New Hampshire authorities shot down the original plan to build it through the Granite State.

Gundlach co-authored a recent study that outlined steps FERC could take to facilitate more long-distance, high-voltage direct-current electric transmission lines without waiting on additional legislation. That could include FERC using its backstop siting authority under the Energy Policy Act of 2005 for when state commissions deny or fail to act on permits for interstate transmission lines located within designated national interest transmission corridors. Federal agencies may be able to rely on programmatic environmental reviews that could be tailored to specific projects, possibly speeding up the review process, Gundlach said.

Speeding things up?

"A lot of environmental law, and administrative law really, came into being after and in some respects in reaction to the massive program of construction that you saw during the Great Depression and shortly thereafter," Gundlach said. "And now we're going to try to do something like what we did before, again, only we have these new legal constraints that are highly relevant."

Support at the state level can also be critical to support the build-out of renewables. Texas invested about $7 billion into transmission infrastructure through so-called competitive renewable energy zones until 2013, which encouraged construction of wind and solar farms by giving developers a way to move electricity out of resource-rich regions of the state. In New York, lawmakers moved in April 2020 to speed up permitting of renewable energy projects larger than 25 MW.

"Legislators said, 'We're going to call for new power lines and we're going to tell the public utility commission that these power lines are necessary so the transmission providers don't have to prove to you that they're necessary, and we're going to ask the public utility commission to select the transmission providers and to decide where the power lines will go'," Julie Cohn, a historian at the Rice University's Baker Institute for Public Policy specializing in energy infrastructure, said about the Texas build-out. "That was a really big deal for getting the project done."

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Siting gas transportation infrastructure is closely regulated by the federal government under the Natural Gas Act. The pipeline setbacks of 2020 illustrated how sophisticated environmental challenges to that oversight have become over the last decade, Gillian Giannetti, a staff attorney at the Natural Resources Defense Council, said in an interview.

"In all of these cases, what fundamentally impeded these projects either through a court or through dollars and cents was the constant and voracious litigation of environmental organizations holding agencies to task for following the law," Giannetti said.

The federal government does not have the same authority over siting electricity infrastructure, something left mostly to the states under the Federal Power Act and a reason for the fragmented nature of the U.S. power grid. But large transmission lines often require some sort of federal permitting, which triggers NEPA reviews.

David Hill, former deputy counsel for energy policy at the U.S. Department of Energy, argued that the Biden administration should keep some elements of a Trump administration rulemaking aimed at easing permitting under NEPA.

"A lot of what it is that those rule changes were intended to do was to speed up the NEPA process and make it more certain," Hill said. "Those reforms would actually help expedite decisions about all kinds of infrastructure projects, including those that would allow the development and deployment of more renewables."

Experts considered legislative reforms of NEPA unlikely and said that most NEPA delays are more caused by court decision and agency interpretations of how to apply the law rather than the law itself. That could also leave Biden's administration some latitude to make permitting easier.

"It's very transparently a problem no matter what your politics are," FiscalNote's Bays said. "And in order for Biden to achieve some of the things he would like to achieve on the clean energy front, it is a problem that has to be solved."