WASHINGTON ― Legislation to streamline the permitting of clean energy projects, including new transmission lines, may require bipartisan collaboration and tradeoffs, according to Sen. Martin Heinrich (D-N.Mex.).

While Republicans and some Democrats, such as Sen. Joe Manchin (D-W.Va.), are focused on permitting new natural gas pipelines, there is an “upside” to the situation, Heinrich said in a brief interview Wednesday at the American Clean Power Association’s Energy Storage Policy Forum.

“If we can do permitting reform and do it well, so much of the capital is actually going to flow to clean electrons. So that sets us up for the potential for a bipartisan solution to all this,” he told RTO Insider.

The senator pointed to cost allocation as one of the “tough issues” to be worked through to prevent states and their residents from “paying for something they’re not benefiting from. But you have to have ways of sharing costs across multiple jurisdictions, multiple businesses and making sure that costs and benefits get shared proportionately.”

Conversations about the issue among Democrats and Republicans in the House and Senate are “more sophisticated than they have been in the past,” he said.

A compromise on pipelines could have “the potential to make this a bipartisan solution,” said Heinrich, who sits on the Senate Energy and Natural Resources Committee, which Manchin chairs. “People have to realize that because of where the markets are heading, anything we do in this space is naturally going to benefit the clean energy transition.”

The need for the storage industry to move ahead with a strong bipartisan strategy was a key theme at the one-day event, with Jason Grumet, ACP’s new CEO, setting the tone in opening remarks that called on attendees to “find a way to balance the audacity of this transition with the humility of the limitations that all technologies have.”

Coming to ACP after 15 years as president of the Bipartisan Policy Center, Grumet said, “The challenge is that … we have to make a century-scale transition in 25 or 30 years. … There’s been a lot of advocacy, which is intended to be supportive, which has not been honest, which essentially said, ‘We can have 100% clean power by 2035 and leave oil and gas in the ground.’  

“That’s not true. It undermines our credibility, makes us seem like hypocrites,” he said. “We just have to be really honest and pragmatic about the challenge. We’re going to have a multi-technology solution,” including natural gas.

“We have to recognize that storage, solar, wind, nuclear, clean gas are all going to be critical to actually decarbonizing the economy, and that’s also helpful because we need a lot of friends,” Grumet said. “We have a divided country, a divided Congress. You can’t get anything done unless you have broad-based appeal.”

Security, Affordability, Climate

ACP’s choice of Grumet to lead the organization, with his strong roots in bipartisan work, comes at a pivotal moment for the industry.

The U.S. energy storage market is “past the inflection point,” said Jason Burwen, ACP vice president for energy storage. The industry put about 9 GW of new storage online in 2022, and according to the U.S. Energy Information Administration, another 21 GW of new storage could be deployed on the grid by 2025.

Further, the Inflation Reduction Act provides a new tax credit for standalone storage, which opens the way for storage to be used as a grid resource. California has more than 4 GW of storage online, not all of it paired with solar, and could need up to 48 GW by 2045, according to the California Energy Commission.

Developers and power plant owners plan to significantly increase utility-scale battery storage capacity in the United States over the next three years, reaching 30 GW by the end of 2025. | EIA

“The remarkable growth in U.S. battery storage capacity is outpacing even the early growth of the country’s utility-scale solar capacity,” the EIA said in a December update. “U.S. solar capacity began expanding in 2010 and grew from less than 1.0 GW in 2010 to 13.7 GW in 2015. In comparison, we expect battery storage to increase from 1.5 GW in 2020 to 30.0 GW in 2025.”

Grumet sees energy storage as a central answer to the economic and political challenges of the moment. “Security, affordability and climate all have to be engaged at once,” he said. “The effort to focus on one of those three elements turns out to be pretty crappy energy policy that tends to lead you towards one side or the other of the political spectrum.”

While different mixes of generation can move the economy toward net-zero, energy storage is a hinge for all the of them, he said.

But bipartisanship can be a double-edged sword. “There’s a ton of bipartisan support for ‘don’t do anything near me’ … which is absolutely at odds with what we need to do,” Grumet said. “We have a society based on this premise of local control and community rights, and we have to honor that premise [but] you cannot transition that economy with community-based decisions.

“So we’ve got to figure out, again, as an industry, how do we make it clear that we have a shared national interest?” he said.

Starting From Nowhere

In an on-stage conversation with Grumet, Heinrich agreed that energy storage must be “socialized” as a “bread-and-butter” solution to a range of energy challenges.

“When I came to the Senate, and that was after four years in the House, there were a very small number of senators [who] were really focused on what are the nuts and bolts to really make the energy transition work,” he said. But as climate change has become an increasingly important issue, “the entire [Democratic] caucus is focused on solutions and looking for solutions.

“So if you come with credibility and say, ‘This policy or this technology is going to be absolutely critical,’ people start with an open mind,” he said.

Bipartisan solutions will also be needed to address clean energy supply chain issues and dependence on China for the processing of critical minerals, such as lithium, and manufacturing of key storage components.

“What we have to recognize is that industry doesn’t exist in a meaningful way in the continental U.S. today, and we need to change that,” Heinrich said. Tax credits for clean energy manufacturing in the Inflation Reduction Act have catalyzed new interest and activity in developing an industrial policy, he said, “but we’re really starting from practically nowhere.”

At the same time, “we don’t want to shut down for seven years,” while domestic supply chains are built out, he said. “You can’t wait until we make everything here to start creating solutions that we know we need today. … Why this is so complicated a problem is because we are really reorganizing the way we power our entire society.”

Grumet raised ongoing concerns on both sides of the aisle in Congress about China’s acquisition of U.S. technologies and intellectual property, which have resulted in “a reluctance to have any connection at all” with the country.  

Both he and Heinrich see new opportunities for U.S.-Chinese joint ventures growing out of the snowballing investments in clean tech manufacturing in the U.S., triggered by the IRA.

While some European countries have labeled the law as “protectionist” and say it will draw investment away from the European Union, Heinrich said, it shows that “we’re serious about taking a new direction.”