Why the Polluter Loophole Bill Must Be Stopped

Polluter Loophole Bill

What is the Polluter Loophole Bill?

The Polluter Loophole Bill is a side deal announced by Energy and Natural Resources Committee Chair Joe Manchin (D-WV) and Senate Majority Leader Chuck Schumer (D-NY). This legislation, negotiated in secret as part of the effort to pass the Inflation Reduction Act, would gut bedrock environmental protections, endanger public health, and fast-track approvals for dirty and dangerous fossil fuel projects, including U.S. gas export facilities.

A leaked version of the bill bears a watermark from the American Petroleum Institute, reflecting the fossil fuel industry’s involvement in this legislative proposal. Reports suggest there is a new version of the bill, but it has not been released even to members of Congress. Leadership plans to attach this side deal to a must-pass government funding bill that must be approved by September 30 to avoid a government shutdown. Calls to separate the Polluter Loophole Bill from the must-pass legislation are growing.  

The People vs Fossil Fuels coalition released reaction quotes from the frontline and grassroots leaders, available here.  A group of 80+ climate environmental groups sent a letter to Senators Booker, Carper, and Duckworth urging them to reject the side deal, available here. A group of 400+ doctors, nurses, and scientists delivered a letter to Speaker Pelosi and Majority leader Schumer opposing the deal.

For critically important renewable energy and grid transmission projects, the proposal would similarly override robust environmental review instead of addressing the implementation issues that have stalled the environmental review for these types of projects. Researchers who led a recent study on 41,000 NEPA decisions by the U.S. Forest Service report that “Contrary to widely held assumptions, we found that a less rigorous level of analysis often fails to deliver faster decisions. Delays, we found, are often caused by factors only tangentially related to the Act, like inadequate agency budgets, staff turnover, delays receiving information from permit applicants, and compliance with other laws.”

Key Takeaways on the Polluter Loophole Bill

  • The Polluter Loophole Bill is a dirty deal designed to benefit the fossil fuel industry. We must do everything we can to stop this legislation in its tracks.
  • The Polluter Loophole Bill would gut bedrock environmental protections, endanger public health, fast-track fossil fuel projects, and advance the approval of the Mountain Valley Pipeline.
  • Members of Congress need to block the Polluter Loophole Bill, including any new fossil fuel handouts.
  • Protecting our communities and climate is paramount to this dirty deal with the fossil fuel industry.
  • The fossil fuel industry hopes to eliminate long-standing protections and tools that the public has to fight back against dirty and damaging projects.

What’s Inside the Polluter Loophole Bill?

  • The Polluter Loophole Bill would direct the President to designate and prioritize projects of strategic national importance and would fast-track permit approvals for those projects.
    • The President would have to designate and periodically update a list of at least 25 high priority energy infrastructure projects and prioritize their permitting.
    • The bill would require a balanced list of project types, including: critical minerals, nuclear, hydrogen, fossil fuels, electric transmissions, renewables and carbon capture, sequestration, storage, and removal.
    • Criteria for selecting designation projects include: reducing consumer energy costs, decarbonization potential, and promoting energy trade with our allies.
  • The Polluter Loophole Bill would curtail bedrock environmental review for energy projects under the National Policy Environmental Act.
    • The bill would set a maximum timelines for permitting reviews, including two years for NEPA reviews for major projects and one year for lower-impact projects
    • It would make it easier to develop categorical exclusions under NEPA, meaning neither an environmental assessment nor an environmental impact statement is normally required.
    • The bill would dictate how agencies conduct environmental reviews and interagency reviews.
    • The bill would expand eligibility for the Federal Permitting Improvement Steering Council streamlining and transparency programs to see more energy projects qualify. It would also provide funding to accelerate permitting.
  • The Polluter Loophole Bill would change the Clean Water Act to make it easier for polluters to discharge pollution into water.
    • Under Section 401 of the Clean Water Act, a federal agency cannot issue a permit or license to conduct any activity that may result in any discharge into waters of the United States unless a water quality certification is issued, or certification is waived. States and authorized tribes where the discharge would originate are generally responsible for issuing water quality certifications. In cases where a state or tribe does not have authority, EPA is responsible for issuing certification.
    • The Polluter Loophole Bill would impose an arbitrary deadline for final actions within one year of certification requests; grant, grant with conditions, deny, or waive certification.
    • The bill would change and restrict how state and tribal agencies review and process water quality certification requests. 
  • The Polluter Loophole Bill would limit the public’s ability to challenge energy projects in court. 
    • The bill would change the statute of limitation for the time to bring court challenges.
    • It would require that if a federal court remands or vacates a permit for energy infrastructure, the court must set and enforce a reasonable schedule and deadline, not to exceed 190 days, for the agency to act on and remand. 
    • The bill would change the process for assigning cases to judges in all federal circuit courts.
  • The Polluter Loophole Bill would change the Federal Energy Regulatory Commission jurisdiction, including the oversight of gas export terminals.
    • The bill would change FERC’s ability to regulate interstate hydrogen pipeline, storage, import, and export facilities.
    • The ongoing lack of transparency makes it impossible to understand the full scope and impacts of these changes. 
  • The Polluter Loophole Bill would require federal agencies to approve the Mountain Valley Pipeline.
    • The bill would require relevant agencies to take all necessary actions to permit the construction of the gas pipeline.
    • The bill would give the DC Circuit jurisdiction over any further litigation. The Fourth Circuit currently, which has jurisdiction over the legal challenges to the pipeline, has repeatedly struck down unlawful actions regarding the controversial gas project.
    • Reports suggest that the current version of the deal does not include the Mountain Valley Pipeline, but the lack of transparency makes it impossible to know whether this is true. 

Why the Polluter Loophole Bill Is So Harmful

  • The Polluter Loophole Bill continues the attack on environmental justice and frontline communities.
  • The Polluter Loophole Bill was put together in secret with the fossil fuel industry.
    • A leaked July 19 draft of the bill bears an American Petroleum Industry watermark, demonstrating the industry’s involvement in the bill’s development. 
    • The bill is a grab bag of giveaways to the fossil fuel industry to expedite pipelines, fossil fuel exports, and other infrastructure by tying the hand of federal agencies and weakening environmental review and oversight.
  • The Polluter Loophole Bill weakens landmark protection for the public’s right to know and engage in decision-making. 
    • The bill would weaken NEPA, the federal cornerstone of our efforts to protect public health and the environment and engage the public in government decision-making. 
    • It would impair the rights of communities across the nation to get answers to basic health and environmental questions to inform decision-making regarding dirty fossil fuel projects. 
  • The Polluter Loophole Bill would make it easier for the fossil fuel industry to discharge pollution into water.