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Energy companies to Trump: Infrastructure plan should include streamlined permit processes
WASHINGTON — As the Trump administration looks to upgrade the nation’s aging infrastructure, energy companies are asking the White House to avoid approaching the venture with tunnel vision.
An infrastructure improvement plan should not be limited to fixing crumbling roads and bridges or modernizing out-of-date airports, energy executives say. It also should include policies that will make it easier to build new oil and gas pipelines, open new mining operations and upgrade the nation’s electricity grid.
“We’re not looking for a handout,” said Luke Popovich of the National Mining Association.
What they are looking for is for the government to streamline its procedures for reviewing projects and issuing the necessary permits. Right now, that process is fraught with endless delays that can drive up the cost of projects or scuttle them altogether, energy leaders say.
“The process is weighted toward stopping projects, not expediting or even allowing them,” Popovich said.
The White House has given few clues about what will be included in its infrastructure improvement package, but President Trump is expected to provide some details during his State of the Union address to Congress on Jan. 30.
Trump pledged during his presidential campaign to spend $1 trillion to renew the country's roads, bridges and airports, and he has asked congressional Republicans to make infrastructure a priority this year.
The administration’s plan is expected to call for a wholesale change in the way the U.S. approaches big infrastructure projects, moving from a "project-based" system in which the federal government identifies infrastructure needs and gives money. The White House now plans to delegate that role to states and private investors, who would also provide the bulk of the funding.
The petroleum industry says it’s ready to do its part.
Oil and gas companies are ready to spend $1.1 trillion on infrastructure improvements through 2035, according to a study commissioned last year by the American Petroleum Institute. But unless the permitting process is simplified, companies could find it difficult to make that investment, Jack Gerard, the agency’s president and chief executive officer, told reporters at a recent event in Washington.
“Those dollars will be spent someplace around the world — our view is let’s spend them right here at home,” he said.
To do that, “certainty and predictability” in permitting is needed, Gerard said.
“The key is to make a decision, hold the decision, and then allow those dollars of investments to flow,” he said.
Tom Donohue, president of the U.S. Chamber of Commerce, made the same argument at a chamber event last week.
“You can’t get the private money if you’re going to stay around (in the permitting process) forever and never give them a deal,” he said.
Opening a new mining operation in the United States can take seven to 10 years because of permitting procedures, Popovich said. The same project could be approved in other countries, such as Canada and Australia, in 18 to 24 months, he said.
The U.S. permitting and review process takes longer because it can involve multiple federal agencies, including the National Park Service, the Fish and Wildlife Service and the Bureau of Land Management, which are tasked with making sure the project will comply with environmental laws and other applicable statutes. Public comment periods are part of the process.
States also have a separate review process that projects often must go through. But critics say the federal and state agencies seldom talk to each other, which can result in unnecessary delays.
“We think everybody ought to have a right to come comment” on a proposed project, Gerard said.
“But once the decision is made,” he said, “the process should move forward. What we’re finding now, unfortunately, in some states, New York being an example, you’ve got some people I believe who are being a little too flexible with their interpretation of the law in order to restrict or to deter economic activities, specifically infrastructure activities.”
Energy lobbyist Liam Donovan said several bills already have been introduced in Congress to streamline permitting procedures and could potentially be included in Trump’s infrastructure proposal.
The mining association also is compiling a plan emphasizing how the problems could be addressed, while at the same time pointing out how the industry could help advance Trump’s infrastructure plan by providing some of the raw materials that will be needed to upgrade bridges, airports and other projects.
To make that happen, however, the permitting process also must be improved, he said.