As the Senate gears up to take on permitting reform next year, a big question hangs over the push: Will they try to fix the slow pace of building long-haul transmission lines?
The politics may be aligning to shift the status quo on the federal level, now that the biggest roadblock to building data centers for artificial intelligence is power.
The Trump administration is all-in on winning the AI race, energy affordability has become a bipartisan rallying cry — and there’s bipartisan agreement that complex, lengthy permitting processes for energy and transmission projects are driving up costs. After years of failed attempts on both sides of the aisle, Republicans may want to strike a deal when they have the most leverage, meaning before the 2026 midterm elections threaten to dilute their leverage in Congress.
That said, transmission is notoriously controversial and has sunk previous attempts at permitting reform. It often becomes a protracted fight over federal versus state authority and whether the customers who ultimately pay for the often multi-billion-dollar projects are reaping enough benefits. Plus, for some vertically integrated utilities that own both fossil-fuel generation and power lines, an interregional transmission line carrying cheaper renewable power into their territory threatens the economics of their power plants.
There are some signs of progress. Last month, SPP approved $8.6 billion in transmission projects across 14 states, and other regions like MISO, PJM, and ERCOT are pushing forward their own major plans. But constructing a transmission line in the U.S. can still take more than a decade. Many cross multiple states, require multiple layers of approvals, and get caught up in lengthy environmental litigation. Once a project has secured permits, as the case of the Midwest’s Grain Belt Express has illustrated, there’s no guarantee that they won’t be pulled back. In 2024, about 320 miles of high-voltage transmission lines were finished—one of the lowest figures since 2011.
Senate Democrats are demanding that Congress break through that logjam.
Is NEPA enough?
Several already put their stakes in the ground last week. Sens. Martin Heinrich (N.M.) and Sheldon Whitehouse (R.I.) — the ranking members of the two committees responsible for permitting reform — and Brian Schatz (Hawaii) said in a statement that they are “committed to streamlining the permitting process” but only if it ensures the U.S. can build out transmission and clean energy.
The statement came in response to permitting legislation moving through the House that doesn’t address transmission. The bill, known as the SPEED Act, would primarily amend the National Environmental Policy Act by setting statutory deadlines for federal environmental reviews and narrowing the window for groups to sue over those reviews to 150 days. The bill would also waive more comprehensive NEPA reviews if the federal government deems a state or tribal one sufficient.
While the changes could speed up the timeline for building transmission and energy infrastructure, Democrats and groups representing clean energy developers, financiers, and electrical manufacturers argue that changing NEPA alone will not resolve all the problems plaguing permitting.
“There’s no one issue alone that impacts the ability to get transmission built,” Larry Gasteiger, executive director of WIRES, a trade group representing utilities and other developers of high-voltage transmission lines, said. “I do think there is some benefit associated with the SPEED Act, like streamlining environmental reviews and putting caps on timelines for judicial review. But it’s a mistake to say that with any one fix, it’s mission accomplished.”
A long-standing debate
Last year, former Sen. Joe Manchin (D-W.V.) and Sen. John Barrasso (R-Wyo.), who then led the Energy and Natural Resources Committee, struck a broad and bipartisan permitting reform deal that included transmission.
Under that bill, developers could petition FERC for a construction permit if state energy regulators failed to act on a project application within one year. FERC would have greater authority to approve the transmission project if it were deemed in the national interest — known as “backstop authority.” That federal backstop could be used only for transmission lines that carry large amounts of electricity, “significantly reduce” congestion, protect or benefit consumers, and improve reliability, among other requirements.
The Manchin-Barrasso bill also sought to clarify how the cost of building transmission lines is distributed among utilities by defining what qualifies as a customer benefit, such as improved grid reliability.
But some groups, including the Competitive Enterprise Institute (funded in part by the fossil fuel industry), opposed those provisions. In a statement last year, CEI argued customers might have to pay for solar and wind projects that are intermittent and don’t improve grid reliability.
House Republicans, including Reps. Julie Fedorchak (ND) and Chip Roy (TX), have similarly said that the way transmission costs are allocated acts as an indirect subsidy for states with decarbonization targets.
Gasteiger rejected that view. He said transmission lines solve many of the problems plaguing an aging power grid.
“Yeah, it could integrate renewables, but it could also relieve congestion, reduce costs for customers, and enhance reliability of the system,” he told Latitude Media.
Another hurdle for transmission is utilities. The trade group representing investor-owned utilities, the Edison Electric Institute, didn’t take a position on the Manchin-Barrasso bill. Some of its members, including Duke Energy and Southern Company — two vertically integrated monopolies in the Southeast — raised concerns about increased federal authority over transmission planning. The National Rural Electric Cooperative Association was similarly opposed.
It sounds counterintuitive that utilities, which build a lot of transmission lines and are guaranteed a profit on that construction, would oppose a bill designed to speed up the process. David Pomerantz, executive director of the Energy and Policy Institute, a utility watchdog group, explained it this way: “Utilities are pro-transmission lines that don’t hurt another part of their business, like some gas plants that they own,” he said. “They are happy to build shorter, low-voltage lines within their own territory. That way, it isn’t undercutting any of their own resources.”
He added that divvying up who pays for an interregional transmission line is already a divisive process. State energy regulators and utilities are all fighting to pay less, Pomerantz said, and those debates are where “a lot of transmission goes to die.” That opposition could be challenging to overcome, given the industry’s political power.
Further complicating the negotiations is a new demand from Democrats: reining in the president’s authority to block wind and solar permits. The fossil fuel industry may get on board, given that it was the target of executive orders during the Biden administration.
Whether Democrats can get both of their demands isn’t clear, but for some it’s their opening offer.
“The SPEED Act does some important things, but also leaves out the sort of elephant in the room: transmission and the national solar ban,” Shatz said during an event in Washington last week.
