Streamlining Regulatory Permitting to Unlock Private Energy Investment

The energy sector faces a paradox: the AI revolution promises economic growth while simultaneously straining the power grid required to sustain it. Senator Dave McCormick argues that this is not just a problem of generation capacity, but a failure of our regulatory and permitting systems. Our current process-first approach, intended to ensure safety and environmental stewardship, has become the primary obstacle to national security and economic competitiveness. The competitive advantage for the U.S. lies not in picking winning technologies, but in establishing regulatory certainty. Moving from subsidizing outcomes to streamlining processes is the only way to unlock the $1.5 trillion in private capital currently sidelined by bureaucratic uncertainty.

The Hidden Cost of Process-First Governance

The most important insight from Senator McCormick is the distinction between energy demand and energy infrastructure. While public debate focuses on the choice of energy sources, such as solar, natural gas, or nuclear, the system is failing on the execution side.

McCormick describes the current permitting environment as poor, noting that energy projects often take five to six years to approve. When compared to the three and a half years it took to win World War II, the inefficiency of the current system is clear. The result of this delay is a failure in capital allocation. Investors, faced with a six year horizon of litigation and regulatory flux, keep their money elsewhere.

If you are a capital allocator... you cannot invest capital into that much uncertainty or if you are going to invest capital into that uncertainty, you can have this endless litigation process or reallocate the capital to something that is a higher return on invested capital.

-- Senator Dave McCormick

This creates a feedback loop: because capital cannot be deployed, the grid fails to expand at the pace of AI demand. This leads to price volatility for consumers, which triggers political pressure to intervene in ways that further distort the market.

Why the Obvious Fixes Often Fail

Conventional wisdom suggests that the solution to energy strain is more government spending or picking winners through subsidies. McCormick argues that this ignores the systemic reality of market breakdowns.

The real bottleneck is the endless litigation that occurs after a permit is granted. By allowing projects to be challenged indefinitely, the system creates a high friction environment where only the most well capitalized or politically connected projects survive. McCormick’s proposal for comprehensive permitting reform is not about removing environmental standards; it is about creating a definitive endpoint for the review process. By constraining the review period to roughly a year and barring post approval litigation, the system moves from a state of perpetual uncertainty to one of manageable risk.

The 18 Month Payoff: Why Small Changes Matter

Systems thinking requires looking for high leverage points where small changes yield large results. McCormick highlights the Rewire Act as an example. Currently, upgrading an existing transmission line requires the same laborious permitting process as building a new one from scratch.

Right now if you go through that upgrade process, you have to go through the normal permitting process even on the existing right away. On the existing right away, you have to go through that. So to get just an upgrade on the existing transmission lines, you are going through this laborious project.

-- Senator Dave McCormick

By allowing utilities to upgrade existing lines within existing rights of way without a full re permitting cycle, the industry could increase grid capacity significantly faster than building new infrastructure. This is a high payoff investment: it requires minimal new physical footprint but provides immediate relief to the grid’s most constrained nodes.

Key Action Items

• Prioritize Regulatory Certainty over Subsidies: Shift focus from picking energy winners to establishing a one year hard cap on environmental reviews. (12 to 18 month horizon)
• Implement Right of Way Reform: Advocate for legislation similar to the Rewire Act to allow immediate capacity upgrades on existing transmission infrastructure without redundant permitting. (Immediate)
• Adopt Local Covenants for Data Centers: For developers, move away from top down messaging toward a five point covenant (energy protection, water use, local labor, tax base impact, infrastructure commitment) to secure community buy in and prevent future litigation. (Ongoing)
• Mitigate Strait of Hormuz Volatility: Continue diversifying energy export routes and increasing naval presence to maintain global supply chain stability, acknowledging that this is a temporary hedge against geopolitical risk. (Short term)
• Squeeze Uncertainty out of Electoral Systems: Support basic, consensus driven reforms like voter ID and proof of citizenship requirements to stabilize public confidence, which is a prerequisite for long term policy stability. (Next 12 months)
• Leverage Bipartisan Infrastructure Coalitions: Use the model of cross party cooperation to focus on national consequence issues like fentanyl, shipbuilding, and energy, where local economic impact overrides national partisan friction. (Ongoing)