Federal actions have exposed 92 GW of utility-scale renewable projects to heightened permitting scrutiny, placing than $121 billion of investment at risk, according to a report by Wood Mackenzie. The report is titled “Federal friction: permitting risk across the US utility-scale renewables pipeline.”
In July 15, 2025 the U.S. Department of Interior (DOI) announced it will require “elevated review” by the Office of the Secretary for project permitting.
Under the rule, seeking leases, rights-of-way, construction and operation plans, grants, consultations and biological opinions are subject to approval by Trump-appointed Interior head Doug Burgum’s office. The rule caused a “de facto ban” on renewable energy development on public lands, said the Solar Energy Industries Association.
Burgum’s “special review” directly caused 7 GW of project cancellations or inactivity on public lands in 2025. Following the implementation of these rules, 32% of the total early-stage clean energy pipeline is now subject to expanded federal review.
The impacts are not limited to projects located physically on public property. A federal review can be triggered by a “federal nexus.” These triggers include impacts to protected wetlands, endangered species, or the use of federal financing.
Because of this, an additional 80 GW of capacity sited on private land is now caught in a review bottleneck.
Technology and geographic risks vary across the pipeline. Solar faces the largest absolute exposure, according to the report. About 30% of the solar pipeline is caught in additional reviews. More than 25% of energy storage capacity faces similar scrutiny. This creates a compounding effect for co-located projects, said the report.
Siting risks on private lands tied to a federal nexus are heavily concentrated across wetland areas in Oregon, Alabama, Maine, Minnesota, and Montana, said the report.
Projects scheduled for 2029 on federal lands face the largest volume of capacity at risk.
The federal permitting obstruction delays commercial operation dates and jeopardizes tax credit eligibility under the One Big Beautiful Bill Act (OBBBA). Exposure is highest in Texas, followed by California and Arizona, said Wood Mackenzie.
A Crux survey this April of 50 solar developers confirms permitting pain. It found 94% of projects that were delayed or abandoned in the last year cited federal permitting as a contributing factor. Over 80% of developers now site projects to avoid a “federal nexus.”
The restriction forces developers to avoid optimal solar sites. All of the surveyed developers who submitted projects to federal review reported higher costs. Most saw a 6% to 10% increase in total project costs. For a 100 MW solar project, this translates to $10 million to $18 million in extra development expenses and up to 5% higher energy bills for customers.
Permitting gridlock is raising prices for buyers, as well. LevelTen Energy data shows North American solar PPA prices climbed 4.6% in Q1 2026 to an average of $64.49/MWh. This is a 13% year-over-year increase. Wind PPA prices rose 8% in the quarter to $79.40/MWh. That is a 24% jump from Q1 2025. The CAISO market saw particularly high increases. Demand remains strong, however, driven by a domestic manufacturing and AI data center boom.
“Permitting remains one of the most critical barriers to advancing new projects,” said Gaby Ackermann Logan of Wood Mackenzie. “Without more coordinated and predictable processes, delays and uncertainty will continue to weigh on development timelines and investment decisions.”
The sector is fighting back through the courts and Congress. In April 2026, a federal judge in Massachusetts issued a preliminary injunction against the DOI policy. The court called the rules likely “arbitrary and capricious.”
More durable relief depends on the Simplifying Permitting and Ending Endless Delays (SPEED) Act. The House passed it in December 2025. The bill now awaits Senate and Executive approval.
The SPEED act aims to reduce permitting timelines by narrowing environmental reviews and sets stricter timelines for decisions. Until then, Wood Mackenzie says developers must manage the pipeline carefully to protect project bankability.
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