U.S. Energy Red Tape Gives China an Edge

by | Oct 22, 2026 | Energy

U.S. Energy Red Tape Gives China an Edge

A bipartisan permitting reform bill introduced in late September is expected to receive congressional attention after the mid-term elections when lawmakers return from recess on November 9. The Bipartisan American Affordability and Jobs Act of 2026 would reinforce statutory deadlines for environmental reviews, overhaul related regulations, and require data centers to fund transmission infrastructure needed to serve them.

Former economic and national security officials from six presidential administrations—spanning both Republican and Democratic leaderships—have issued a statement supporting the legislation. The signatories include former Secretary of State and CIA Director Mike Pompeo from the Trump administration and former Treasury Secretary Janet Yellen from the Biden administration, along with advisers from the Bush and Clinton presidencies. According to these officials, the United States currently faces significant competitive disadvantages in industrial development due to protracted permitting processes that can extend five to fifteen years for infrastructure projects.

The former officials contend that China has gained ground in the competition for technological and manufacturing leadership through streamlined energy infrastructure development. China has constructed more high-voltage transmission capacity over the past 15 years than the United States has built throughout its entire history, they noted. In 2024, China accounted for 31.5 percent of global knowledge- and technology-intensive manufacturing value added compared with 20.7 percent for the United States, according to National Science Foundation data cited in their letter.

The energy industry has rallied behind the measure. The American Petroleum Institute and major companies including BP have urged congressional approval, arguing that permitting reform would provide investment certainty and enable the construction of infrastructure needed to meet rising energy demand. However, critics characterize the bill as anti-environmental legislation designed to facilitate the expansion of hyperscale artificial intelligence data centers and associated fossil fuel infrastructure.

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