Energy policy is becoming increasingly complex, controversial and perhaps volatile as grid operators seek long-term certainty about their ability to serve increasing loads as electrical energy supplies rapidly turn around. Over the past year, there have been numerous federal actions, investigations and proceedings related to critical elements of energy project development, such as land access, siting and permitting, interconnection and, of course, transmission. As the government comes to power, many of these platforms may be reevaluated.
Use of public lands
The Bureau of Land Management is increasingly important in the trajectory of the U.S. energy economy. Whether for mineral and fossil fuel extraction, the siting of renewable projects, or large-scale transmission corridors, access to federally owned public lands is coveted by a broad and diverse group of stakeholders. Agency actions by the outgoing administration, such as the BLM Western Solar Plan may come under scrutiny by new leadership and majorities in Washington.
The expansion of energy projects on public lands is at a critical time with new leadership in Washington. The transition will bring increased scrutiny to existing policies, raising complex questions about rebalancing environmental protection, economic development and public access. As the new administration reassesses the Department of the Interior’s overall goals, the agency’s decisions will fundamentally change where and how new energy projects are developed, signaling a potential paradigm shift in public lands management.
The transmission bottleneck
While the potential for renewable energy on public lands is promising, a significant challenge looms: transmission infrastructure. The Biden administration recognized this bottleneck and instructed the Dept. of Energy (DOE) and the Federal Energy Regulatory Commission (FERC) have the authority to accelerate transmission projects.
This push for rapid transmission expansion led to debates over issues of cost allocation and federal versus state jurisdiction. New leadership at the DOE is expected to require close coordination among federal, state, and local authorities if the bulk electric system is to be expanded.
Judicial complications: Loper Bright’s decision
As if the policy landscape wasn’t complex enough, several court decisions from 2024 added another layer of uncertainty. The Supreme Court’s ruling in Runner Bright Enterprises against Raimondothat reverses a long-standing precedent for agency deference created by the Chevron decision will have significant implications for energy policy. By limiting the scope of administrative agencies’ authority, Loper may necessitate securing important energy initiatives through legislation rather than relying solely on administrative actions.
This shift could create greater uncertainty in regulatory efforts, potentially delaying or complicating energy infrastructure projects. For example, BLM’s decisions on land use for energy projects or FERC’s orders on transmission could be subject to greater legal scrutiny. The energy sector must now navigate a landscape where administrative actions can carry less weight, creating a potential need for more prescriptive, comprehensive legislation to create long-term certainty for new energy policies.
The Manchin-Barrasso Energy Permitting Reform Act of 2024 was an example of a comprehensive and prescriptive piece of legislation that provided very specific guidance to the agencies that would be responsible for implementing the bill’s guidelines. However, the legislation was not passed until the end of the year, giving the incoming Congress the opportunity to refine the bill to better reflect the priorities of the new majorities.
Mapping the path forward
The future of America’s energy economy will be determined by how stakeholders effectively navigate this complex web of public land use, transmission challenges, legislative changes and judicial decisions.
To move forward effectively:
- Policymakers should develop comprehensive legislation that provides clear guidelines for energy development, balancing economic needs with environmental protection.
- Federal agencies like BLM and FERC must adapt to the post-Loper Bright landscape and ensure their actions have strong support from Congress.
- State and local governments must actively engage in transmission planning and collaborate with federal initiatives to ensure network reliability and expansion.
By addressing these goals head-on, the United States can build a modern electric grid that can meet the demands of the future. The path forward is complex, but with thoughtful policies, a more reliable and resilient energy future is within reach.
