A Vague Proposal for Reforming NEPA
An attempt to make a functional environmental protection agency
What NEPA Is
NEPA is the review process governing what any project receiving federal funding must do to ensure they are minimizing harm to the environment.
From the official website:
NEPA requires federal agencies to assess the environmental effects of their proposed actions prior to making decisions. The range of actions covered by NEPA is broad and includes:
making decisions on permit applications,
adopting federal land management actions, and
constructing highways and other publicly-owned facilities.
Using the NEPA process, agencies evaluate the environmental and related social and economic effects of their proposed actions. Agencies also provide opportunities for public review and comment on those evaluations.
It wasn’t a bad idea, nor do I believe that the people who created it had malicious intentions.
But it is clear now that NEPA and its state-level equivalents have become not only inimical to building things in reality (atoms, not bits, as they say), it has become inimical to those trying to protect the environment.
Why NEPA Has to Go
There is a common misconception among people who advocate for government regulations that a government regulation forces reality to exist in a particular state.
In other words, people think that because NEPA is a government regulation protecting the environment, it is good and protects the environment.
This is a fundamental confusion between the tool, NEPA, and the desired result, a protected environment. A hammer is not the same as a house, though one plays a part in making the other.
What NEPA actually does is, as above, force federal agencies to write a report about the environmental impacts of actions they plan to undertake. This is not, by itself, a bad idea; the problem is that someone figured out that they could sue the federal government for not doing a good enough job assessing said impact, and judges gained the power to block any federal action under this pretext.
The result - the state of affairs we find ourselves in - is that anyone who wants to stop any federal action with even the tiniest impact on the environment can do so, simply by suing the government for not having done a good enough Environmental Impact Statement (EIS). The government then has to spend years proving to a judge that it did the statement sufficiently well.
This is absurd on multiple levels.
On the first level, government agencies have adapted to the threat of these lawsuits by spending years of time and millions of taxpayer dollars producing saga-length EISs, slowing down large portions of the federal bureaucracy for no discernable gain.
On the second level, while the initial impetus to consider impacts on the environment is not a bad idea, there is no economic reasoning or mandate to consider costs vs. benefits in NEPA. Lawsuits can be filed based on the smallest impact on a random species of snail, and they can stop a project that would provide large amounts of carbon-free energy to many households. There’s no reasoning or weighing of risks and drawbacks, just slavish devotion to the status quo.
On the third level, NEPA has been somewhat defanged already when it comes to oil and natural gas drilling, as those industries/lobbyists had the time and money to lobby for exceptions and expedited approvals, whereas geothermal, solar, hydro, and other carbon-free energy sources are routinely blocked.
On the fourth level, NEPA has been coopted as a tool by the wealthy to block any government action they don’t like. Think about it: who has the knowledge, the time, the money, and the expertise to hire lawyers to sue the federal government: poor people forced to move for new powerline construction, or the wealthy preventing powerlines from going up near their houses and decreasing their property values?
It’s time for NEPA to be replaced by something better.
Here’s my idea for the something better.
What Should Replace NEPA?
The legal system in the US is designed to be adversarial - prosecution vs. defense - because the people who created it believed that the best chance they had for truth to emerge from a process was an adversarial competition. It’s well beyond me to determine whether or not they were right, but the adversarial design adds a great deal of time and expense to every legal proceeding.
Environmental regulation inherited this adversarial design, largely because it uses the same court system as the rest of US law, and that, I think, is the core mistake. There’s no need for the same kind of offense and defense for environmental regulation as there is for criminal proceedings because we’re not talking about a specific person’s life and fate. Broader details and context, economic analysis, and cost-benefit calculations should be sufficient to handle most issues in the field.
Even if we wanted to keep the adversarial design, the current system allows anyone to sue a project for not following guidelines, which predictably leads to projects either not happening or becoming incredibly expensive.
An alternative model is needed, one based on cooperation instead of conflict, that turns environmental advocates and builders into allies instead of enemies.
Proposal
First of all, there should be a minimum size at which environmental regulation applies. If a project costs less than e.g. 10 million dollars or effects less than one acre of land, a basic set of environmental regulations apply, but that’s it. There’s no review process, no suing, no blocking it. The project goes ahead if the local developers or government decide that it should.
For everything larger, here’s how it works.
The EPA maintains a large number of teams of environmental auditors. These are experts in environmental law and/or science whose mandate is to help Americans build in environmentally friendly and sustainable ways. They are measured - and rewarded - based on the number/scale of projects/developments they help realize.
When a developer or government body wants to develop, they request a team, and one is sent (size of the team should scale to size of the project; for many projects there may only be a single person). This team works with the developer through the entire process to ensure all relevant environmental codes are followed. If/when issues arise, this team is empowered to solve them creatively. EPA team members can be recruited from existing EPA talent/lawyers, as well as be a prestigious thing for academics to do.
As an example, imagine a developer is building a large solar farm and needs to connect it to the grid. A mandated analysis of environmental impact is made and determines that the project would threaten the habitat of a species of owl nearby. In today’s world, this could become a legal battle stretching out for years. In the new system, the environmental auditors attached to the project determine that the owls can be relocated at a cost of (to pick a random number) $50,000. The developer is compelled to pay the cost, the owls are moved, and the project proceeds.
This is a win-win: on one hand, the environment was protected. On the other, the developer will happily pay fixed costs in order to avoid the uncertainty of a legal quagmire. It’s far cheaper for them to pay the $50,000 to move the owls and be done with it than spend millions on lawyers to still possibly lose in court. The delays alone while the legalities are sorted out would likely cost more than any mitigations the environmental team would demand.
Because the developer/government agency worked with the EPA team, they cannot be sued (on environmental grounds) and the project goes ahead, giving them valuable confidence in their development, which drives investment.
A smaller, specialized team within the EPA (internal affairs) will be tasked to audit a randomized sample of these projects for environmental impact and compliance.
Incentives
Unlike much legislation, I consider the key to a functioning system its incentives - are the people involved incentivized to engage in the behaviors that make the system function?
In this system we have three parties’ incentives to consider.
The EPA’s environmental auditor teams:
The success of the people in these teams - and thus their professional prestige (and bonuses if such a thing is possible) should be measured by how much they enable to be developed. Their goal is to help get things built, and this measure incentivizes them to do so.
The internal randomized audit, conducted by a separate, specialized team, provides a check on corruption and an incentive for the teams to be honest.
Developers:
Developers are incentivized to cooperate with the EPA’s teams because doing so provides confidence that projects can be completed on-time and on-budget. Uncertainty is a huge problem in development, and well worth spending money to reduce. Environmental impacts can be budgeted for; a long legal battle that kills a development can’t be.
The internal randomized audit also incentivizes developers to not cheat the EPA teams they’re working with, as if the audit reveals such deception the legal penalties would not be minor.
The EPA’s internal auditors:
They aren’t rewarded or punished for their findings; they operate independently, ensuring that the only incentive they have is to do their job.
Randomization of which teams audit which projects helps prevent incentives for systemic corruption, because it can’t be known in advance who will be auditing what.
In this system, the EPA and developers are reimagined as allies in the effort to build American's future.
Conclusion
The theme of environmentalism in the US has, for too long, been about blocking development and stopping things from being built. It’s not the 1970s anymore; we know a lot more about the environment than we used to, and we have better regulations for developing sustainably.
We need to change how the government interacts with industry and the environment to enable America to build. We need new methods of power generation and transmission, new infrastructure, new transportation, and more, and for that we need to rethink how we handle environmental regulation.
I’ve presented a rough draft of what that regulation could look like. I’m sure there are plenty of problems with it, plenty of ways it could go wrong or be gamed - but the question isn’t whether or not my idea is perfect, it’s whether or not it’s better than NEPA. And I’m confident that my vague idea is better for getting things built than NEPA ever could be.