Duck Season

This Week's Trend In Brief:

• Before the Senate left town for the midterm campaign’s final stretch, key senators and the White House reached a robust permitting compromise, but with the first vote set for Monday, the question now is whether Democrats’ sweep of both chambers on Tuesday drowned the bill’s chances.

   

• While the bill’s Senate authors insist they remain committed, its path through the House is far less certain, in large part because outside groups used the six weeks between the compromise and the first vote to give key House Democrats reasons to waver.

   

• In those weeks, environmental and progressive groups organized letters, ad campaigns, and protests while elevating tribal nations’ objections to the bill’s rewrite of historic preservation law, a wedge that turned a technical provision into a question of sovereignty and Democrats’ top sticking point.

   

• At the same time, a surprise Election Day endorsement from the electric co-ops and public power utilities that fought the 2024 deal’s transmission provisions expanded a coalition spanning nearly every corner of the energy industry – but it may not be enough.

   

• To ensure passage, energy industry advocates will need to understand how opponents are organizing, convince key House Democrats that no better deal awaits in the 120th Congress, and marshal allies across the spectrum to press Congress to finally unleash America’s energy resources faster and more broadly.

Digging Deeper:

Before the Senate left town for the midterm campaign’s final stretch, key senators and the White House reached a robust permitting compromise, but with the first vote set for Monday, the question now is whether Democrats’ sweep of both chambers on Tuesday drowned the bill’s chances. Unveiled on Sept. 30 by the leaders of the Senate’s environment and energy committees, the Bipartisan American Affordability and Jobs Act (BAAJA) arrived with White House backing, as a Trump administration spokesperson said the deal “will deliver transformative policies to lower Americans’ energy and housing costs.” But it landed just as the Senate adjourned, leaving leaders only enough time to file cloture and set up a first vote this coming Monday, Nov. 9th. Now, Democrats are set to control both chambers in January, leading one Wall Street analysis to cut its odds of the bill’s success from about 40% to about 25%, warning the result “likely emboldens voices arguing [the] bill gives too many concessions” to oil and gas companies. For the energy industry, a deal that looked like a rare bipartisan win just over a month ago now enters a lame duck where every vote doubles as a bet on what the next Congress might offer.

While the bill’s Senate authors insist they remain committed, its path through the House is far less certain, with House Democrats about to chair the relevant committees expressing skepticism. Sen. Martin Heinrich (D-NM), a lead author, stated the bill “is the closest we have come to actually finding something that can get signed into law, and I’m not going to wait,” while fellow author Sen. Sheldon Whitehouse (D-RI) called it “a bird in the hand.” In the House, however, Rep. Jared Huffman (D-CA), the top Democrat on the Natural Resources Committee and in line to chair it in the next Congress, argued in September that Democrats would “soon have a far better negotiating position,” and dismissed the bill’s now-or-never framing as “fishy and not intellectually honest.” Rep. Frank Pallone (D-NJ), who is expected to chair the Energy and Commerce Committee, has not publicly weighed in on the bill, but he has warned that without new guardrails on data centers, “the possibility of a moratorium out there is certainly real.” That uncertainty is in large part the work of outside groups, which spent the weeks since the compromise arguing, as Huffman has, that a Democratic Congress can pass a more ambitious bill. Yet even with larger majorities, Democrats will fall short of the 60 votes needed to advance a bill in the Senate and will still need the president’s signature.

Since the bill’s introduction six weeks ago, environmental and progressive groups organized letters, ad campaigns, and protests while elevating tribal nations’ objections to the bill’s rewrite of historic preservation law, a wedge that turned a technical provision into a question of sovereignty and Democrats’ top sticking point. Within two weeks of the initial deal, a 185-group coalition led by the Center for Biological Diversity, Food & Water Watch, the Indigenous Environmental Network, and Third Act branded the bill a “massive power grab by Big Tech and the fossil fuel industry.” In New Mexico, 48 environmental, community, and Indigenous organizations launched full-page ads urging one of the bill’s lead sponsors to withdraw, as hundreds of students walked out of class in protest. Nine tribal organizations asked Senate leaders to strip the historic preservation title entirely, and the wedge worked, with a Senate Democratic aide calling it their “number one challenging issue.” Environmental groups have leaned on that tribal partnership before, most visibly in 2016, when the Standing Rock Sioux Tribe’s challenge to the Dakota Access Pipeline, argued by Earthjustice lawyers, rested principally on the same consultation law this bill rewrites. And the morning after the election, More Than Just Parks, a public lands advocacy outlet, told Democrats to “kill the permitting bill,” arguing their new majorities make a lame duck deal unnecessary.

At the same time, a surprise Election Day endorsement from the electric co-ops and public power utilities that fought the 2024 deal’s transmission provisions rounded out a coalition spanning nearly every corner of the energy industry, but it may not be enough. In a joint letter, the National Rural Electric Cooperative Association and the American Public Power Association expressed “strong support” for the bill, conditioned on a “technical change” that keeps federal regulators from gaining new authority over their members. Two years ago, the same groups warned that the 2024 deal took a “one-size-fits-all, top-down approach.” Their support joins oil and gas, clean power, and labor. Yet industry support has never been the bill’s main problem, and as we noted last year, “support in D.C. does not always translate to speed on the ground.” The House Democrats who now hold the bill’s fate are hearing most loudly from environmental groups, tribal nations, and their own base, and concessions like the co-ops’ technical change will do little to satisfy them.

To ensure passage, energy industry advocates will need to understand how opponents are organizing, convince key House Democrats that no better deal awaits in the 120th Congress, and marshal allies across the spectrum to press Congress to finally unleash all of America’s energy resources faster and more broadly. Opponents have spent more than a month building arguments aimed squarely at the Democrats who will decide the bill’s fate and backed those arguments with an army that just helped Democrats sweep the elections. The bill’s Senate authors are already arguing that the votes, let alone the President’s signature, will not be there next year, but that case may not land with House Democrats fresh off a win those same groups helped deliver. For public affairs professionals and the companies they represent, the priority now is mapping the network behind the opposition, from the national groups setting the message to the local organizers and tribal leaders carrying it into members’ districts, anticipating their next moves, and preparing to rebut whichever arguments are actually moving the Democrats whose votes are in play while also ensuring the Republican conference unites behind the legislation.

Trends in Energy is your weekly look at key trends affecting the energy industry, brought to you by the competitive intelligence experts at Delve. As the political and regulatory landscape continues to shift, reach out to learn how our insights can help you navigate these challenges.