Politics & Policy

Our Top Five Stalled Energy Projects

Energy projects that were delayed, postponed, or terminated in 2010 (Project No Project)
Jobs and growth take a backseat to petty activism and grinding bureaucracy.

In 2010, as a direct result of environmental concerns, NIMBY activism, and a sluggish permit-granting process, there were 351 energy projects that were being delayed, postponed, or outright terminated. This is according to a study published by the Chamber of Commerce entitled Project No Project. Together, these projects were estimated to be worth $1.1 trillion and expected to create 1.9 million jobs. The overriding lesson from the report was that, given America’s byzantine permit system, opponents of any project can find a violation somewhere within the mountains of paperwork a firm is required to submit. This lesson is still relevant today. Here are just five examples: 

 1. Harry Reid Protects Nevadans from Jobs: Coal is the most hated energy source in America. It’s not surprising that even though the U.S. Bureau of Land Management granted LS Power final approval for a $2.5 billion coal plant in White Plain, Nevada, in 2008, its opponents continued to appeal the decision. In its complaint, the Sierra Club argued that the environmental-impact study for the plant overlooked the plant’s effect on greenhouse-gas emissions, air quality, and several nearby national parks. They were joined in their criticism by scores of environmental groups, as well as Senate Majority Leader Harry Reid (D., Nev.), who sent a letter condemning the project to then-governor Jim Gibbons (R., Nev.). In 2009, LS Power postponed the plant indefinitely, citing economic conditions and “increasing regulatory uncertainty.”

2. Environmentalists Defeat Pernicious Goals of Environmentalism: Six years ago, Northwest Energy started planning a 32-turbine, 82-megawatt wind farm near Nasselle, Washington. The project, which would have been the first wind farm in the Pacific Northwest, was hailed by some as a great step forward in creating “a clean, renewable energy resource that is ecologically friendly and economically wise.” The Audubon Society, on the other hand, saw the project as a death trap for the Marbelled Murrelet, a local endangered bird species. Studies showed that the turbines would likely kill one Marbelled Murrelet every two years. Northwest Energy spent the next three years and most of $3 million studying the bird. But it was to no avail. As costs escalated, investors backed out. On November 16, 2011, Northwest Energy officially terminated the project. 

3. Montana Energy for Montanans: One of the most surprising facts about the current permit process is the difficulty faced by renewable-energy producers. Almost half of the delayed projects in the Chamber of Commerce study involved renewable energy, including the Mountain States Transmission Intertie Line. This 430-mile transmission line would carry energy from wind projects in Montana, and is designed to help the area reach renewable-electricity mandates. It’s estimated that the construction would employ 3,211 people, and add 547 permanent jobs once the facility is operational. Opposition has come from several angles: Local residents cited the potential health and aesthetic impacts of the pipeline; PPL Montana, a coal plant in the area, has accused MSTI of trying to gain a monopoly over energy transmission; and a member of the Public Service Commission has stated that he will kill the project, calling it “nothing more than a way to drain inexpensive Montana-produced power out of the state and into lucrative California markets.” The firm stated in 2010 that because of setbacks caused by this opposition, they didn’t expect the line to be completed for at least five years.

4. Marine Biological Warfare: When Clearwater Port submitted an application to build a $300 million offshore liquid-natural-gas terminal 12.6 miles off the coast of Oxnard, California, they faced many of the typical complaints about pollution and damage to the marine ecosystem. However, environmental group Santa Barbara Channelkeeper cited a more unusual issue; that, given our dependence on energy, the pipeline could be the target of a terrorist attack. The Coast Guard admitted that it was not able to completely protect against this possibility. This logic could apply to any useful but imperfectly protected manmade structure — schools, roads, office buildings, stadiums, etc. — but the group’s complaint was sufficient warrant for the California State Lands Commission to terminate the application.

5. Six More Weeks of Nuclear Winter: Overall prospects for the nuclear industry are looking up. The permit-granting process has been streamlined so that firms can get simultaneous approval for both the construction and operation of a plant. As a result, on February 12 of this year, the Nuclear Regulatory Commission issued its first permit since the Three Mile Island meltdown in 1978. But every silver lining has a cloud. In contrast with this single triumph are dozens of failures and stalled projects. For example, DTE Energy first submitted an application to start work on an expansion to its Fermi Nuclear Plant near Monroe, Michigan in September 2008. The 1,500-megawatt unit would have created between 1,000 and 3,000 construction jobs, and around 700 permanent jobs. But the firm has yet to receive its license to start building. A coalition of environmental groups including the Sierra Club, Don’t Waste Michigan, Beyond Nuclear, Citizens for Alternatives to Chemical Contamination, and the Citizens Environment Alliance of Southwestern Ontario has sued over DTE’s permit application and has been granted intervener status in the hearings against the DTE’s plans. The process was already a year behind schedule in 2010. There’s no telling if or when Fermi 3 will be green lit.

When the political consensus required that stimulus projects be made “shovel ready” in 2009, the National Environmental Policy Act was amended so that projects could be given an expedited review. Over 70 percent of the projects covered in the American Recovery Act were then given categorical exceptions to the NEPA permit process, which usually requires both Environmental Assessment and Environmental Impact Surveys. The evidence suggests that similar provisions are required permanently on the federal and state level.

— Nash Keune is a Thomas L. Rhodes Journalism Fellow at the Franklin Center.

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