Withdrawals of federal funding and permit changes have contributed to the cancellation or abandonment of 7 GW of renewable energy projects on federal land by 2025, while another 12 GW are currently threatened on federal land and 80 GW on private land, according to an analysis by Wooden Mackenzie. That’s more than $121 billion in renewable energy investments at risk from federal changes.
“Federal Friction: Permitting Risks in the U.S. Renewable Energy Pipeline,” Wood Mackenzie’s new report states that when the Department of the Interior (DOI) issued a renewable energy permitting memorandum in July 2025, it extended permitting deadlines and increased scrutiny for any wind or solar project involving a federal agency.
“Permitting risk varies by technology, although wetland permitting remains the most significant constraint on solar, wind, and energy storage. Wetlands account for the majority of private land exposure, with the risk concentrated in Oregon, Alabama, Maine, Minnesota, and Montana. However, wind projects are more limited by permitting airspace. Since 2025, dozens of gigawatts of early solar, wind, and energy storage capacity have been canceled or stalled. However, it has been stalled. important to note that not all cancellations are due to permitting issues, some also stem from supply chain constraints and tighter financing conditions,” said Kaitlin Fung, senior research analyst at Wood Mackenzie.
The analysis shows that 30% of the solar pipeline is at risk of additional review. However, wind has the largest proportional exposure, with 62% of the pipeline affected (excluding the ongoing FAA shutdown). In energy storage, more than a quarter of the planned capacity is confronted with stricter permit research.
With these new permitting rules, Wood Mackenzie reports that 32% of its pipeline of early-stage projects are now subject to additional federal review – those that have been announced, in development or already permitted. Projects scheduled for 2029 are at greatest risk of additional federal lands review, which could jeopardize tax credit eligibility. Most of these projects are in Texas, California and Arizona, where concentrated federal oversight could delay commercial operation dates beyond planned timelines.
Policy developments offer some relief
In April 2026, a federal court issued a preliminary injunction blocking these new restrictions and expanding comprehensive assessments for wind and solar projects because they were likely unlawful under the Administrative Procedure Act. It won’t solve the permitting bottleneck, but it will limit further disruption to federal permitting processes.
In addition, the Simplifying Permitting and Ending Endless Delays Act, which passed the House of Representatives in December 2025 and is currently awaiting further passage, proposes to limit the scope of environmental reviews, reduce duplication of effort between agencies, and implement stricter timelines for permitting decisions.
“Permitting remains one of the most critical barriers to advancing new projects, and without more coordinated and predictable processes, delays and uncertainty will continue to weigh on development timelines and investment decisions,” said Gaby Ackermann Logan, research associate at Wood Mackenzie. “Especially for storage, where development is often tied to solar energy, allowing uncertainty has a compounding effect. The policy landscape is changing rapidly, and developers who can anticipate where the bottlenecks lie will be better positioned to protect their timelines and preserve project bankability.”
News item from Wood Mackenzie
