“Sputnik” was not the only nostalgic moment in the State of the Union address. When President Obama called on Congress to “invest” in “clean energy breakthroughs” that would “translate into clean energy jobs,” he echoed every president since Nixon. In fact, President Obama himself made the same arguments two years ago, when he signed the stimulus bill.
“Because we know we can’t power America’s future on energy that’s controlled by foreign dictators,” the president said in 2009, “we are taking big steps down the road to energy independence, laying the groundwork for new green energy economies that can create countless well-paying jobs. It’s an investment that will double the amount of renewable energy produced over the next three years.”
Environmental activists applauded the stimulus’s $20 billion investment and joined the president in asserting that renewable energy projects would bring both a cleaner economy and sorely needed jobs. The Sierra Club called the stimulus “a win-win for a strong economy and a healthier environment” and hailed the government’s commitment to “promoting the shift to wind and solar.”
All of which was long forgotten by December 2010, when the Sierra Club sued California regulators to block a solar energy project in the Mojave Desert—and asserted that stimulus money was the root of the project’s evil.
The Calico Solar Project would be built in the Mojave Desert, 100 miles east of Los Angeles. Twenty-five thousand mirrored dishes, each standing 40 feet high and 38 feet wide, would fill a 4,600-acre plot of public land now controlled by the U.S. Department of the Interior. The project would generate 663.5 megawatts of electricity and connect to the grid by a two-mile transmission line. According to its proponents, the project could power more than 186,000 homes.
The project is subject to myriad federal and state laws, with multiple agencies sitting in judgment. At the state level, the California Energy Commission would license it and lead the environmental reviews required by California law. And at the federal level, Interior controls the rights-of-way needed to construct and operate the facility on public lands and would lead the mandatory federal environmental review. Interior must also take into consideration numerous other federal laws, such as the Endangered Species Act, National Historic Preservation Act, Clean Air Act, and Clean Water Act and consult with federal agencies such as the Department of Energy and Army Corps of Engineers; with state agencies such as the California Energy Commission; with Native American tribes; and with the public at large. Under certain circumstances, many of those agencies have effective vetoes over energy projects such as Calico Solar.
Calico Solar first applied for approval in 2008. Two years later, both California and Interior approved the project as safe, proper, and lawful. Interior found that the project would “provide climate, employment, and energy security benefits to California and the nation,” and that its environmental impacts were sufficiently minimized to justify its approval. And California determined that the project “will ensure protection of environmental quality and assure reasonably safe and reliable operation of the facility,” and that “direct, indirect, and cumulative adverse environmental impacts will be mitigated to the extent feasible”; where full mitigation of environmental effects “is not feasible, overriding considerations warrant acceptance of those impacts.”
Interior and California supported their decisions with strong evidence and thorough analysis. Interior’s decision and environmental report comprise nearly 1,600 pages; California’s, over 700 pages.
Calico Solar, vetted and approved by California and Interior, looked like a perfect example of the renewable energy projects that Congress, the president, and environmental groups all called for. But the Sierra Club, which two years earlier had praised the stimulus’s support for solar and wind power, quickly petitioned the California Supreme Court to block the project . . . and blamed the stimulus money for creating incentives for regulators to rush their reviews: “In its rush to help the Project applicant qualify for attractive economic incentives pursuant to the federal . . . stimulus legislation, the Energy Commission unlawfully ignored longstanding [state environmental] requirements that required it to protect the environment and listed species.”
Among those alleged errors was potential harm to wildlife—first and foremost, the endangered Desert Tortoise. According to the Sierra Club, California failed to “fully mitigate” the project’s possible effects on tortoise habitat. That will be a difficult charge to prove, because California extensively reviewed the tortoise issue and required the project to adopt numerous tortoise-protection measures: perimeter fencing; the development of a desert tortoise “translocation” plan; strategic placement of parking areas, transmission lines, and roads; reporting requirements upon the discovery of injured or dead tortoises; and the project’s acquisition and maintenance of 10,300 acres hospitable to tortoises in “compensatory habitat mitigation.”
And amidst the Sierra Club’s various complaints about the project’s effect on desert tortoises, one noteworthy fact goes unmentioned. The commission’s survey of the approved 4,600-acre project site detected only 10 tortoises.
Three years ago, California governor Arnold Schwarzenegger spoke to a Yale audience on environmentalist opposition to clean energy projects. “They say that we want renewable energy, but we don’t want you to put it anywhere. . . . I don’t know whether this is ironic or absurd, but, I mean, if we cannot put solar power plants in the Mojave Desert, I don’t know where the hell we can put it.”
The Sierra Club’s Calico Solar lawsuit certainly calls to mind the governor’s complaint. So does the separate federal lawsuit filed by Californians for Renewable Energy and other organizations to overturn Interior’s approval of Calico and five other desert solar projects. And another case, in which a Native American tribe convinced a federal judge late last year to issue a preliminary injunction blocking Interior’s approval of another solar energy project.
The term NIMBY—“Not In My Back Yard”—long ago came to summarize the local opposition to nearby infrastructure development. Fossil fuel projects are accustomed to local and environmentalist opposition. But ironically, renewable energy projects may give rise to even more local or environmentalist opposition. The bigger a project’s geographic footprint, the more environmental resources it implicates, and solar and wind projects have the biggest footprints of all. In Energy at the Crossroads, scientist Vaclav Smil noted that the generation of electricity using solar involves a “power density” of 20 to 60 watts per square meter. Wind scored even worse, at 5 to 20 watts per square meter. “This is in great contrast to the extraction of fossil fuels and thermal generation of electricity,” Smil writes. “These activities that define the modern high-energy civilization produce commercial energies with power densities orders of magnitude higher, ranging mostly between” 1 to 10 kilowatts per square meter.
In other words, as Peter Huber and Mark Mills conclude in The Bottomless Well, “no conceivable mix of solar, biomass, or wind technology could meet even half our current energy demand without (at the very least) doubling the human footprint on the surface of the continent.”
And the generation facilities—the solar and wind farms themselves—are only part of a project’s total environmental impact. The sites best suited for renewable energy generation tend to be far from the industrial and population centers that they are built to serve. The Mojave Desert solar projects and far-offshore wind farms are not being created to power nearby desert- or island-dwellers. Nor are the wind farms envisioned for the Midwest and Great Plains intended only to power family farms. Instead, those projects will serve distant demand via long-distance transmission lines, crossing state borders, passing through numerous communities, and perhaps affecting endangered species and federally protected wetlands.
In short, renewable energy projects face immense regulatory challenges. Which raises a critical question: Why is the federal government spending billions of dollars on renewable energy when federal and state laws stand as obstacles to the subsidized projects’ prospects?
If Congress and the president continue to subsidize utility-scale wind and solar projects—in an effort to decrease reliance on foreign energy sources, to diversify domestic energy supplies, to reduce emissions, or for other reasons—then regulatory reform appears to be necessary. Effective regulation is neither a rubber stamp nor a bureaucratic morass. Rather, it intelligently balances the relevant competing priorities:
Public participation. Communities are naturally distrustful of corporate projects that threaten to affect their local environments substantially. No regulatory process can retain its legitimacy without providing a meaningful opportunity for affected persons to be heard, and to be taken seriously.
Safety. Energy infrastructure places electricity, nuclear fuel, natural gas, and other hazards close to the workforce and the community. Federal regulators must therefore ensure that a project will be safely constructed, operated, and maintained.
Environmental protection. The myriad environmental protections codified in federal and state law promote a clean environment. The national interest in promoting renewable energy does not require their wholesale dis-regard, but it does require federal lawmakers to ensure that environmental statutes retain their flexibility, instead of becoming inappropriately rigid.
Expertise. Many federal and state agencies and other organizations have expertise to contribute to the regulatory process. The best regulatory framework draws that expertise to the table, where it can be put to its best use, while not allowing every contributing agency an effective veto over the project.
Judicial review. In the modern regulatory state, expert agencies are supervised lightly, but surely, by the courts. Judicial review, conducted under the deferential but firm standards of administrative law, allows the agencies to exercise their expert judgment in light of national priorities yet protects against clear errors of judgment or violations of binding law.
Efficiency. A national effort to promote renewable energy infrastructure—especially one intended to stimulate “green jobs” in the near future—must ensure that the regulatory reviews and subsequent judicial reviews are undertaken as promptly and efficiently as possible. Cape Wind, the embattled Cape Cod offshore wind farm, demonstrated astonishing fortitude in enduring a decade of litigation, environmental reviews, and legislative battles before finally securing its regulatory approvals. That project’s willingness and ability to forge ahead were exceptional, and Congress cannot assume that other projects will be able to endure similar tests of will.
Most important, in constructing a regulatory framework to achieve those ends, Congress need not write on a blank slate. Lessons have been learned from a century’s experience in regulating oil and gas pipelines, liquefied natural gas import facilities, hydropower dams, nuclear facilities, and even the interstate transmission lines and the wind or solar farms that already have been proposed. Applying those lessons, an effective regulatory scheme for major renewable energy projects must include at least the following components:
One decision, one decider. Writing in support of the single presidency in Federalist 70, Alexander Hamilton urged that committing the executive power to a single office would not only secure the benefit of “energy in the Executive,” but also would focus responsibility and ensure accountability. Absent a single decisionmaker, “it often becomes impossible, amidst mutual accusations, to determine on whom the blame or the punishment of a pernicious measure, or series of pernicious measures, ought really to fall. It is shifted from one to another with so much dexterity, and under such plausible appearances, that the public opinion is left in suspense about the real author.”
Such is the case when responsibility for reviewing and approving or disapproving an energy infrastructure project is scattered across numerous federal agencies, or is bifurcated between the federal and state levels. Agencies that lack total jurisdiction over—and responsibility for—a given regulatory issue may avoid hard choices, interject opinions without taking responsibility for their effects, or lack the incentive to develop their own organizational competency for reviewing and processing project applications. Committing to one agency the sole authority over a project would better avoid those ills by focusing clear responsibility on that agency.
Accordingly, if Congress deems large-scale renewable energy projects to be a national priority, then it should commit to one federal agency—Interior, for example, or the Federal Energy Regulatory Commission (FERC)—the power and responsibility to make final decisions to approve or disapprove projects. Just as “the unity of the executive . . . was one of the best of the distinguishing features” of New York’s constitution, according to Federalist 70, the unity of the executive will be the best distinguishing feature of renewable energy regulation.
Of course, the other relevant federal and state agencies must be brought into the process and contribute their expertise: the Army Corps of Engineers and the Department of the Interior on water issues, the EPA on air quality issues, state regulators on matters of local concern, and so on. Furthermore, Congress can require the primary agency to undertake particular types of public involvement and to respond to public comments, to protect local communities’ right to be meaningfully heard.
Current laws that organize environmental reviews by assigning one agency the role of “lead agency,” with other agencies serving as “consulting” agencies, are good models. Even more effective would be a regulatory framework giving the single lead agency controlling authority over all collateral permits as well—namely, approvals under the Clean Water Act, Coastal Zone Management Act, and other statutes that distribute control of mandatory collateral approvals across multiple state and federal agencies.
Alternatively, Congress might determine that state regulators ought to be allowed the “first bite at the apple,” with federal regulators stepping in only under certain circumstances. That framework might be workable, but only if Congress sharply identifies the precise circumstances in which federal authority controls.
A cautionary example of that alternative model is the Energy Policy Act of 2005, which assigned to FERC the “backstop” authority to approve or disapprove interstate transmission lines in “national interest corridors” if the state “withheld approval for more than one year” after a project filed its state application. That statute seemed clear enough, until a federal court surprisingly concluded that FERC lacked authority to overturn the state when the state disapproved the project outright within one year. (Specifically, the court concluded that a state that denied a project application within a year had not “withheld approval for more than one year.”) An effective regulatory framework for renewable energy projects would need to speak with utmost clarity as to when the state’s authority ends and the federal authority begins.
Federal preemption of state law. On a related but separate point, dueling federal and state laws often overlap in the regulation of energy infrastructure safety or environmental protection. That overlap leaves the courts with the ultimate task of deciding whether state law can block a project that federal law authorizes.
Congress often enacts statutes that give federal law preemptive effect, but even clear statutes may give rise to lengthy litigation. The Natural Gas Act’s implied preemption of state law required decades of litigation to establish. The Energy Policy Act of 2005 expressly provided that federal law would trump state law in the approval or disapproval of liquefied natural gas import facilities, but years of litigation still ensued in federal courts to confirm the scope of that preemptive authority. Any federal plan intended to quickly build renewable energy infrastructure must either decide the preemption question clearly and broadly or risk years of delay while the question works its way through the courts.
Balancing energy development and environmental protection. The various environmental statutes regulating energy projects tend to be written in broad terms that, while originally intended to be administered prudently, can be transformed into rigid, imprudent barriers against sound projects. If renewable energy infrastructure development is a federal priority, then Congress should prevent environmental laws from barring projects even when their social benefit far outweighs the minimal social cost.
One possible solution would be to vest the federal decisionmaker with authority to waive the operation of a federal environmental law in extraordinary circumstances. Such provisions are not novel; Congress included a discretionary waiver of obstructive federal laws in the REAL ID Act’s mandate for the building of a southern border fence, and it has included similar provisions elsewhere. But any waiver would need to be constructed carefully, to limit its application to extraordinary cases.
Expedited judicial review. After surviving years of federal regulatory review, an approved project faces still more years of judicial review, absent a federal statute requiring expedited review. Jurisdiction to hear appeals involving renewable energy projects should be assigned to the federal courts of appeals—bypassing the lower federal district courts—with instructions to expedite those cases. Furthermore, Congress should consider assigning exclusive jurisdiction over such cases to the U.S. Court of Appeals for the D.C. Circuit—a well-respected, comparatively expert body of judges that regularly hears many cases involving energy and environmental regulation.
None of this is to say that the nation must promote clean energy alternatives. The costs of that transition would be immense. But if Congress and the president continue to spend substantial sums in support of utility-scale renewable power projects, then regulatory reform is necessary to ensure that those expenditures amount to more than a full-employment fund for lawyers, activists, and bureaucrats.
Adam J. White is a lawyer in Washington, D.C.