Subcommittee Witness Testimony Supports Portman’s Energy Efficiency & Reform of Federal Permitting Process Included in Bipartisan Infrastructure Investment & Jobs Act

WASHINGTON, DC – Today, U.S. Senator Rob Portman (R-OH), Ranking Member of the Homeland Security and Governmental Affairs Committee, discussed how the Senate-passed Infrastructure Investment & Jobs Act includes Senators Portman, Kyrsten Sinema (D-AZ), and Joe Manchin’s (D-WV) bipartisan Federal Permitting Reform and Jobs Act, as well as provisions from his bipartisan Energy Savings and Industrial Competitiveness (ESIC) Act with witnesses at the Senate Homeland Security and Governmental Affairs Subcommittee on Government Operations and Border Management hearing on “Strategies for Improving Critical Energy Infrastructure.”

The Federal Permitting Reform and Jobs Act makes FAST-41 permanent and will give project sponsors more certainty, which will allow them to create more jobs and develop our nation’s infrastructure more efficiently. Portman’s bipartisan Federal Permitting Improvement Act, which was enacted into law as Title 41 of the Fixing America’s Surface Transportation (FAST) Act created the Federal Permitting Improvement Steering Council (Permitting Council), brings together agencies at the start of the permitting process for some of the largest, most complicated infrastructure projects to write out a comprehensive plan for the permitting process across agencies.

Key provisions from Portman’s bipartisan Energy Savings and Industrial Competitiveness (ESIC) Act, which he introduced with Senator Jeanne Shaheen (D-NH), are also included as part of the Infrastructure Investment and Jobs Act. The provisions will improve energy efficiency in buildings and the industrial sector, which will help reduce emissions and protect the environment, while also creating jobs and supporting a more stable grid.

An exchange of the questioning can be found below and a video can be found here.

Portman: “Thank you, Madam Chair. And thank you guys for the great testimony today. In my opening statement, I talked about the Permitting Council. I want to get back to that in a minute. But first, I was interested in some of the things you said. Mr. Yonker, you talked a little bit about flexibility and adaptability of both the supply and demand as being important to a resilient 21st century grid. As you know, perhaps, the bipartisan infrastructure bill does include a number of provisions for energy efficiency, including some provisions from the work I’ve done with Senator Shaheen over the years on helping on efficiency. Also weatherization for low-income Americans. What role does energy efficiency play in tempering the demand side of this, in terms of making sure we have a reliable grid and helping to support its overall operation and reliability?” 

Mr. Bryce Yonker, Executive Director & Chief Executive Officer at Grid Forward: “We don’t weigh a whole lot into generation mixed topics, but this is an exception to that rule. Absolutely cost-effective energy efficiency resources, deployed first, they lower the bar. So if we have a peak need or we have a grid disturbance, it just makes it easier to deal with that. So efficiency being deployed at scale is a great place to start – is the place to start. And there’s some really interesting overlap between automated energy efficiency and demand-side management and DER integration and that is really blurring those lines in smart buildings and other areas. That, as you said, is importantly supported in the package.” 

Portman: “Great. Well, I appreciate that. I do think it’s an important part of the answer, and it’s bipartisan, and it’s something that is so great for the economy. It makes us more competitive globally to have more efficiency because they’re lower costs in manufacturing as an example. So I appreciate your focus on that. 

“Mr. Bryce, in your testimony, you state that policies to ban the use of natural gas and to, as you say, electrify everything are dangerous to the reliability of our electrical grid. You talk about concerns about not having enough energy resources and diverse energy resources. This is exactly what’s going on in Ohio. In Ohio, we have a very diverse portfolio, but coal and natural gas still provide more than 80 percent of our state’s electricity and increasingly it is natural gas, about 40 percent. Coal is about 45 percent now. Nuclear is about 13 percent, renewables about two and a half percent. Can you, Mr. Bryce, talk a little about the benefits of a diverse energy portfolio and how energy innovation in renewables in storage technology and advanced nuclear and hydrogen and carbon capture, how those can really help to provide for a more stable grid and more energy affordability?” 

Mr. Robert Bryce, Author, Journalist, and Public Speaker: “Well, that’s quite a laundry list there, Senator, but I will take a couple of cracks at it. First, to the issue of natural gas and this push for electrifying everything, I do indeed think it’s not just a bad policy, it’s a dangerous one. And I speak from personal experience. During the February blackout in Austin, my wife and I bought our house 21 years ago, one of the first things we did was plumb in natural gas. And so we were 45 hours without electricity. But we still had gas so we could cook. We had hot water, we could keep at least the kitchen warm by turning on the burners. The idea that we would just rely solely on the electric grid for all of our energy needs, including hot water for cooking, et cetera for heating is just a bad idea. And unfortunately, we see in California now more than 50 communities have banned the use of natural gas in new residential construction and in many commercials. It’s also a regressive policy, Senator, that the price of electricity on a per unit of energy basis is four times that of natural gas. This was according to a notice in the Federal Register published by the Department of Energy earlier this year. 

“So as far as the other issues that you mentioned, let me just touch on the nuclear because you brought up a lot of issues there. I’m adamantly pro-nuclear, sir, if we are serious, and if the Senate, if Congress, if we’re going to be serious about decarbonization in the United States, we have to get deadly serious about nuclear energy. This is the fifth time I’ve testified before Congress. I have been consistent over the last ten years in my testimony before Congress. If Congress is going to be serious about decarbonization, we need bipartisan, long-term support for the development and deployment of new nuclear reactors, and we need to preserve and extend the lives of the existing reactors in our fleet.” 

Portman: “Yeah, well, I couldn’t agree more. And this new technology is safer, fewer issues with regard to the disposal challenge, and the rest of the world is going to surpass us unless we catch up on that technology.” 

Mr. Bryce:And if I can build on that, sir, it’s clear that the Russians and the Chinese are the ones that are now leading internationally on the development and deployment of new nuclear. French President Macron, just in the last few days in response to the gas crisis in Europe, said the French are now going to be deploying small modular reactors. The U.S. needs to get off the dime and move and move quickly.” 

Portman: And we also have an enrichment challenge here in this country, we have only one place that’s an American enrichment source, and it’s not commercialized yet. It happens to be in Ohio. And so that’s the Portsmouth Gaseous Diffusion Plant, which is now changing into a centrifuge plant. But we need to get the commercial level of enriched uranium up so that we can have an adequate industry here in the United States. How about hydrogen? Anybody else in the panel wants to talk about hydrogen, derived from various sources, including, of course, fossil fuels, natural gas. As one example, we have a plant in Ohio that’s doing that on a commercial scale. What’s the potential there?” 

Mr. Bryce: “I’ll just jump in really quickly, sir. I’m skeptical about hydrogen just for several reasons. One is the amount of energy needed to produce hydrogen molecule. I’ve done the math many times. It’s roughly one and a half units of energy in for one unit of hydrogen out. Then you have a molecule that’s very difficult to handle, very difficult to store. And we don’t have a lot of fuel cells sitting around in which we can use hydrogen. So I understand the discussions, but I’ve been hearing the same discussions about hydrogen now for 20 years. I’m happy to admit that I may be wrong, but we’ve heard this for a long time.” 

Portman: “Anyone else on the panel want to talk about fuel cell technology and where you see it going? Hydrogen fuel cells.” 

Mr. Alex Herrgott, President and Chief Executive Officer at The Permitting Institute: “Senator, I just like to point out that the market is dictating the profitability and the ability to determine an ROI on new energy sectors. That’s why you’re seeing all of the old legacy utilities previously, whether it be a Duke Energy or Dominion rebalance assets to try and figure out how they can operationalize new sources of electricity to derive a ratepayer, whether that be coal, natural gas, hydrogen, you name it. And so in many cases, the federal government doesn’t have a role except to get out of the way and try and fix this so that the 20 to 30 percent on that project development cost, which we have $800 billion sitting right on the sidelines. We can actually address the capacity issues rather than looking at efficiencies and microgrids as our only solution, which is triage to address the fact that we need to double our actual gigawatt output regardless of where it comes from, 20 percent a year, every year for the next 20 years to meet overall energy demand. So I don’t think we’re in a position to dictate to the private sector that funds most of this what energy source they should choose and derive an ROI on.” 

Portman: “Alex, let’s just talk about the project development cost issue a little bit. We talked earlier during my opening about the removal of the sunset on the FAST-41 provision, which enables us to have some more certainty and predictability going forward with regard to the Council and ensuring that we are saving money on every single project that is covered, including a lot of energy projects. As the former Director of the Federal Permitting Improvement Steering Council, and by the way, I appreciate your inviting me down to participate in some of those Council meetings and listen to what goes on and meet with the agency leadership that is involved from dozens of different parts of our government. It’s been really interesting, but what can be done to improve the Permitting Council? How could it be even more effective?” 

Mr.  Herrgott: “That’s a good question. The Permitting Council is not a magic bullet. It can’t compel agencies to meet milestones and meet deadlines in a way in which it supersedes the 30 odd, 60 permitting laws that have been passed over the last 100 years, whether it be the Endangered Species Act passed in the 70s, the Rivers and Harbors Act from 1910, FPISC is a tool to coordinate federal agencies and ensure accountability. But at the end of the day, the agencies are self-reporting, self-selecting their permitting schedules. And what I worry about is there’s a tremendous amount of front loading happening before FPISC ever gets to provide those accountability protocols, which can now be as much as two to four years before an application is deemed complete, and that never makes it on to anyone’s sheets. And when we’re talking about NEPA or NEPA reviews or what this CEQ was doing, it’s about the 60 other permits that happened before and then the land use permits that happened after that delay construction. There’s only been ten projects added to FPISC this year, and I worry sometimes that the illusion of progress is no progress at all. And I get worried that it’ll lessen the urgency for us to actually do the hard work because there’ll be a mission accomplished that if we extend FPISC in perpetuity, that we’ve solved all the world’s problems when in fact, it is a small piece of the puzzle, but an extremely necessary one to exhibit the best practices all agencies should incubate.” 

Portman: “Well, I appreciate your passion for this and your consistent advocacy up here in the Hill and then at the Council, now in your private sector role. You talk about, in your testimony, these formal and informal policies to front-load preliminary biological, cultural, historical surveys. How do we bring more accountability to that process?” 

Mr. Herrgott: “I think first of all, it’s the idea that many of the federal regulators don’t actually really talk to each other. I mentioned one of the projects wherein the Department of Interior, three different agencies within don’t talk to each other, nor do they actually understand each other’s requirements. And so there’s this rush to meet a schedule without actually understanding that the folks putting these projects forward are not to be treated as adversaries, but rather customers. They are the same Americans that are building the broadband, the transmission, the natural gas. Somewhere along the line, the process has gotten so complicated that even I don’t understand the documents when they’re 10,000 pages long and have another 10,000 pages of appendices, attorneys should not be talking to attorneys. Scientists should be talking to the scientists. That’s why my nonprofit, the Permitting Institute, is working with Christine Harada, who is the current executive director of the Federal Permitting Council. She’s doing an amazing job, but she’s only one person. She can’t make the agencies care about accountability and efficiency and media milestones. She’s only one person. You have to have an activated executive branch and the administration that is putting Deputy Secretaries as Council members in a place to adjudicate disputes and clear out the communication breakdowns that happen amongst agencies. Unfortunately, I’m not sure that’s occurring.” 

Portman: “Do you think we have the right people currently sitting on the Council? The statute requires members to be Deputy Secretary or higher but it appears to me that a number of the members currently are not at that level. Does that raise some practical problems in the Biden administration?” 

Mr. Herrgott: “I think the way in which President Obama and yourself and others when they were enacting the Council and then it was over the last four years as a truly nonpartisan entity. This is not to inject politics into the process. All it requires is that somebody at the top end of the agency able to adjudicate disputes and clear out the disagreeing voices on a risk-based decision on whether a project is a green light or a red light, or what mitigation needs to occur. If you do not have that Deputy Secretary in that role, then it hampers the Council and in many cases and makes it ineffective.” 

Portman: “Yeah. So you think a more senior membership would be helpful, moving forward?” 

Mr. Herrgott: “Senator, statute says Deputy Secretaries for a reason.” 

Portman: “Great. Well, listen, again, I appreciate your work on this over the years. And, Alex, let’s keep in touch. And thanks for coming before the Subcommittee today to give us your expertise and all the witnesses, we thank you for your help on the energy infrastructure challenges we face. Thank you, Madam Chair.”