The House of Representatives on Tuesday voted to advance legislation favored by Big Tech heavy hitters such as OpenAI, Meta and Microsoft to reform the process for obtaining federal permits for projects to build out artificial intelligence infrastructure in the United States.
Backers of the bill, the SPEED Act, argue it is key to helping the U.S. beat out China and other global competitors for leadership in AI.
The bill cleared a crucial procedural vote 215-209 on Tuesday in the House. A final vote by the House on the bill could take place later this week.
“For companies like OpenAI that are investing in data centers, networking, and supporting infrastructure across the United States, a more efficient and predictable permitting process is essential,” Chan Park, head of OpenAI’s U.S. and Canada policy and partnerships, wrote in a letter supporting the bill.
The SPEED Act would blunt the 1969 National Environmental Policy Act, which mandates federal reviews for projects that could affect the environment before permits are issued.
Efforts over the years to reform NEPA have been thwarted by Democrats, who have sided with environmental advocates against Republican lawmakers aligned with business interests.
But recently, as AI has been seen as an increasingly important sector, support has grown among Democrats for easing the permitting process.
And pressure has increased on Congress as China laps the U.S. in building out AI infrastructure, and as energy-hungry AI data centers stress an aging electric grid.
“We’ve made it entirely too difficult to build big things in this country, and if we do not reform that, that will be a powerful gift that we are giving to China,” said Rep. Dusty Johnson, R-S.D., a member of the House Select Committee on the Chinese Communist Party, in an interview with CNBC.
“Absent a meaningful reform of NEPA, it’s going to be difficult for us to get where we need to go,” Johnson said.
In a sign of bipartisan support for reform efforts, the SPEED Act was co-sponsored by House Natural Resources Committee Chair Bruce Westerman, R-Ark., and Rep. Jared Golden, a Maine Democrat.
The Data Center Coalition, a group representing major tech companies that are building data centers, said that “comprehensive permitting reform is a must-have to win the AI race, grow the U.S. economy and secure America’s continued global leadership.”
“Unfortunately, transmission and generation constraints across the country are restricting economic growth, including the development of the U.S. data center industry,” said Cy McNeill, the group’s director of federal affairs.
McNeill said that industry “is seeking to continue investing hundreds of billions of dollars in the U.S. annually to build America’s digital infrastructure.”
The SPEED Act would tighten the timelines for federal agencies to conduct reviews under NEPA and limit the law’s ability to hamstring a project.
The bill also shrinks the current six-year statute of limitations for challenging a permit decision to 150 days. That reform, proponents say, will reduce the number of lawsuits that can stall projects for years.
“Anybody that wants to stop something under NEPA has an upper hand,” Westerman, the bill’s co-sponsor, said in an interview.
“Data centers use a lot of energy, and we’ve got to build more energy infrastructure, more energy generating capacity, and the hurdle to doing that is getting these projects permitted,” Westerman said.
He warned that data centers could get mired in NEPA litigation if they receive federal funding, such as money from the CHIPS and Science Act for semiconductor production projects.
The semiconductor giant Micron, in a letter, said that the SPEED Act would “accelerate the implementation of economic development investments, such as those by Micron, and would ensure every federal dollar is used efficiently and effectively.”
Despite bipartisan agreement on the need for reforming the permit process, the SPEED Act is running into hurdles on Capitol Hill.
The ultra-conservative House Republican Freedom Caucus opposes an amendment that Golden added to the bill, which would limit a president’s ability to revoke permits for energy projects that he does not like.
President Donald Trump this year has done just that with offshore wind permits.
Freedom Caucus Chair Andy Harris, R-Md., threatened to tank the bill before it reaches the floor of the House if Golden’s amendment remains in the bill.
“The Golden amendment has to be taken out, and that’s a minimum,” Harris said. “If that’s in there, that rule is not going to succeed.”
It is unclear if enough Democrats will back the SPEED Act to cancel out the effect of any opposition to it from the Freedom Caucus’ members.
Republicans hold a very slim majority in the House, and the party’s leadership can only afford to lose three votes, at most, from the GOP caucus to pass legislation without Democratic support.
At the same time, some Democrats in the House want further concessions than Golden’s amendment to ensure that clean energy projects canceled by Trump will resume.
“I imagine there will be, as there were in committee, a handful of Democrats who are willing to vote for it in its current version, but certainly not a critical mass,” said Rep. Seth Magaziner, D-R.I.
“Almost every Democrat that’s open to permitting reform is going to need some assurances that clean energy is gonna be a part of it,” said Magaziner, who has signaled interest in reforming the permitting process.
Other Democrats think the bill goes too far in undercutting the environment.
“This is standard fare, fossil fuel industry wish list stuff,” said House Natural Resources Committee Rep. Jared Huffman of California, that panel’s top Democrat.
Even if the House passes the bill, it will be just the first piece of a planned larger package to reform additional parts of the complex federal permitting apparatus. Lawmakers are eyeing the removal of hurdles to building out interstate energy transmission projects.
The Senate has yet to present its own bill for permitting reform, although there are discussions behind closed doors about such a measure.
Democrats will have more leverage in the Senate on such legislation because a permitting reform bill will need 60 votes to break the filibuster. There are only 53 Republican senators.
“I think both our teams are figuring out, you know, what’s important to the two different caucuses on the committee, and, you know, I hope to be trading paper with Chairman [Mike] Lee very soon,” Sen. Martin Heinrich, a New Mexico Democrat, said at a recent Semafor event.
Lee, R-Utah, is chairman of the Energy and Natural Resources Committee, where Heinrich is the ranking member.
— CNBC’s Emily Wilkins contributed to this report.
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