Lawmakers’ return to Capitol Hill this week marks the beginning of a two-month sprint in which permitting reform, government spending bills and party-line budget packages will make up just a fraction of Congress’ jam-packed agenda.
The House and Senate are facing a mountain of legislative priorities ahead of the August recess, and lawmakers are hoping to make meaningful progress on each one before entering the summer and fall campaign season.
The upcoming scramble will be a major test of Congress’ ability to firm up bipartisan deals on a number of priorities with implications for energy and environment policy.
It will be a particularly pivotal time for Republican leaders, who will try to advance two partisan spending and tax packages filled with conservative wins they hope to campaign on.
“I’m not saying it’s easy; I mean, our margins are thin just to get consensus with our own party,” House Budget Chair Jodey Arrington (R-Texas) said recently on CNBC’s “Squawk Box.” “It’s a tough process.”
The reconciliation bills will be the GOP’s top target over the next several weeks. Leaders are hoping to pass as soon as this week a Republican proposal to fund immigration enforcement agencies.
Then, they plan to quickly pivot to another reconciliation package — their third this session — which would be far more expansive and potentially include provisions on energy and environmental reviews.
At the same time, the House and Senate Appropriations committees will look to make progress on their fiscal 2027 spending work. The House is set to vote on the Republican-drafted Agriculture-FDA bill this week, and the Senate looks to release and mark up its own spending bills starting Thursday.
Congress’ bipartisanship will be challenged as negotiations on several major priorities continue. Lawmakers in both chambers are plowing ahead in their quest to reform the federal permitting process for all kinds of energy and infrastructure projects. They are hoping to strike a deal well before the end of the year.
The House and Senate Armed Services committees are set to begin their work on the annual defense policy bill, which will include language on critical minerals, nuclear energy and environmental cleanups. The House panel will hold a daylong markup of its bill Thursday. The Senate panel will release and mark up its version next week over the course of two days.
Meanwhile, the Senate Environment and Public Works Committee may try to finalize its version of the surface transportation reauthorization bill. The House Transportation and Infrastructure Committee advanced its bipartisan bill last month, setting up a potential clash with the Senate over proposed electric vehicle fees, climate program repeals and other contentions provisions.
Lawmakers are hoping to get closer to a bicameral compromise on the farm bill, and there could be a major fight over a proposal to permanently authorize E15 biofuel sales. The Water Resources Development Act, which authorizes Army Corps of Engineers projects, is also expected to come together sometime this summer.
Permitting reform
Key Senate leaders in both parties hope to close a deal this summer on a long-sought push for comprehensive legislation to ease permitting rules for building energy production, transmission and pipeline projects.
Clinching a deal on permitting could represent a rare bipartisan solution to voters’ concerns about energy affordability. And it would also satisfy a diverse array of lobbying groups who want the federal government to cut red tape so they can quickly build energy projects to satisfy skyrocketing demand from an influx of artificial intelligence data centers.
But President Donald Trump is making the process more difficult because of his continued attacks on solar and wind projects, which Democrats say undermine their trust that the administration would adhere to the terms of any deal meant to benefit all energy sources.
“I have some members coming to me and being like, ‘Why should we give them permitting reform if they’re not going to actually follow the law?’ And I understand that perspective,” Sen. Martin Heinrich (D-N.M.), the ranking member of the Energy and Natural Resources Committee and a leading negotiator, said in a recent interview. “So, a little good faith in the administration would go a long way toward improving the prospects of getting to a final deal.”
Democrats are skeptical that Trump’s agencies would faithfully implement any changes to environmental laws. To get around that, negotiators are looking to include measures to limit executive branch authority to revoke approved permits or stall over reviews.
“We have to make sure that there’s certainty so that we don’t pass something, and then Trump can still rip up permits,” Sen. Ruben Gallego of Arizona, an Energy and Natural Resources Committee Democrat, told POLITICO. “What he’ll do is he’ll just do gas, but not do renewable permitting, and we’ll just wind up looking like we’re idiots by dealing with them that way.”
Even as Trump threatens their progress, negotiators say they are aligned on the broad contours of a potential deal. They are confident that Majority Leader John Thune (R-S.D.) would prioritize floor time for permitting reform during a busy summer should a deal materialize, given the bipartisan urgency around building more energy projects — and fast.
Also saving time is that Environment & Public Works and Energy & Natural Resources committee leaders are likely to forgo holding markups on any big permitting bill, people familiar with the situation say, because of jurisdictional challenges.
The White House, meanwhile, is insistent it wants to see a deal — particularly to impose restraints on lawsuits that often stall or kill projects — and on measures to ease pipeline approvals under the Clean Water Act.
“Whereas a couple of years ago, perhaps those Democrats who wanted transmission reform, they said we won’t touch Clean Water Act, we’re not going to do anything, but now they’re saying that it impacts the projects they want to do also,” said Rep. Mariannette Miller-Meeks (R-Iowa), chair of the Conservative Climate Caucus.
“So, I do think there’s a willingness to look at both of those things, along with NEPA reform,” the lawmaker said. “There’s a window of opportunity, and I would hate it to slip through our hands for both parties.”
Appropriations
The Senate Appropriations Committee is set to kick off its work on fiscal 2027 spending bills this week with the release of its first three funding measures: Agriculture-FDA, Legislative Branch and Commerce-Justice-Science.
Sen. Patty Murray (D-Wash.), ranking member on the Energy and Water Development Appropriations Subcommittee, said in late May that she and subcommittee Chair John Kennedy (R-La.) did not yet have an agreement on a top line for the Energy-Water bill. The committee could unveil its Interior-Environment measure as soon as this month.
Senate action will come weeks after the House began its own appropriations work, but the upper chamber’s bills are expected to be largely bipartisan. The House has been advancing mostly partisan proposals that Democrats have criticized for cutting funding for climate programs, targeting renewable energy and enabling what they have called President Donald Trump’s “vanity projects” on public lands.
The dual-track appropriations work over the coming weeks will highlight partisan differences on energy and environment issues while putting on display appropriators’ reluctance to sign off on the White House’s plans to impose steep cuts on a host of bipartisan priorities.
“I think we’ve been exemplary on a bipartisan basis, doing the work that the country expects us to do, so I’m hoping we can showcase it,” said Rep. Marcy Kaptur (D-Ohio), ranking member on the House’s Energy and Water Appropriations Subcommittee.
The House will vote on the Republican-drafted Agriculture-FDA measure this week. House appropriators will also mark up the Interior-Environment bill and the Transportation-HUD bill. Both of those measures target renewable energy, and Democrats are certain to demand amendment votes to undo those proposals.
The House Energy-Water bill advanced out of committee along party lines last month, with Democrats incensed about proposed cuts to renewable energy and efficiency programs. Panel leaders on both sides of the aisle say they will continue to pursue a bipartisan product.
Reconciliation 2.0 and 3.0
Republican leaders say they are bullish on their chances of passing one — if not two — filibuster-proof reconciliation bills this summer, but intraparty disagreements could slow down their efforts or derail them completely.
Senate Republicans are looking to find consensus as soon as possible on some politically tricky language in their bill to fund immigration enforcement. If they succeed in passing that bill this month, they plan to quickly move onto another one — a successor to last year’s One Big Beautiful Bill Act.
That third reconciliation bill, known as “Reconciliation 3.0,” will be centered around tens of billions of dollars in new funding for the Department of Defense. That spending would be offset by provisions designed to target what GOP leaders say is fraud in health care and other programs. Some Republicans also want to add energy-related provisions into the mix, but it’s not clear that the bill will be able to accommodate them.
“We know what we can and can’t do. There’s a lot that we’re not gonna do that I would like to do that I have on my list of about $1 trillion in savings,” Arrington said recently on Punchbowl News’ “Fly Out Day.” “The question is where can we get the consensus of all four corners of our caucus and the political diversity within our conference.”
Arrington noted that many of the GOP conference’s ideas for reconciliation 3.0 have come from the Republican Study Committee, which released a framework for the bill earlier this year that included proposals on permitting reform, Venezuelan oil imports and ways to kill energy efficiency standards.
Still, the idea of including permitting provisions in a party-line bill has prompted pushback from key negotiators of a broader bipartisan framework, and committee leaders with jurisdiction over energy and environment issues have questioned whether they will be able to get new policies into the reconciliation bill at all.
NDAA
The House will take its first action on the fiscal 2027 defense policy bill Thursday with a marathon markup that could see lawmakers try to insert additional energy and environment language into the massive bill.
The Senate plans to unveil and mark up its version of the National Defense Authorization Act next week. The two chambers are hoping to pass their bills and settle on a compromise before the end of the year.
House Armed Services Committee leaders released their bipartisan draft of the NDAA last week, replete with language on critical minerals acquisition, renewable energy technologies, nuclear power and environmental cleanups.
It also includes language requiring the Department of Defense to produce a report to Congress on the impacts of rising energy costs on service members and installations.
The report must include an assessment of how many service members have sought financial assistance to pay their utility bills and a description of what DOD plans to do to address the projected increase in energy costs, whether that be implementing energy resilience measures, adding more generation on installations or adopting other strategies.
This week’s markup will allow the committee to flesh out the draft NDAA with new language before advancing the legislation to the House floor. Lawmakers may look to insert provisions to scrutinize offshore wind projects, which the Pentagon says pose a risk to military readiness, or to reestablish a defunct energy bureau at the State Department, which could serve useful during wars.
Perennial bipartisan priorities for the annual defense bill include provisions on the remediation of per- and polyfluoroalkyl substances, or PFAS; language to harden military installations against severe weather and energy disruptions; and proposals to supercharge production of minerals and other materials needed for weapons, batteries and other advanced technologies.
Farm bill, biofuels
Senators will grapple in the coming weeks with two agricultural priorities — advancing a five-year farm bill and permanently lifting seasonal restrictions on the sale of higher-ethanol fuel called E15.
While it’s possible the two issues could ride together, putting the E15 proposal into the farm bill proved a politically risky idea in the House, where leadership made a late decision to break them apart. Both eventually passed.
Senate Agriculture, Nutrition and Forestry Chair John Boozman (R-Ark.), who has small petroleum refiners in his state who are skeptical of E15 and biofuel mandates, could introduce a farm bill in early June, potentially for a markup later in the month, following up on staff work done during the Memorial Day recess, according to congressional staff and lobbyists following the progress.
Boozman said he’s looking to avoid some of the most divisive issues, which might make E15 and another hot topic — liability protection for pesticide makers — poor candidates for the farm bill, at least in committee.
The pesticide provision, protecting companies from lawsuits related to illnesses allegedly tied to the chemicals, was struck from the House version through an amendment on the floor. The initial House bill also included a provision barring states from requiring their own health labels that veer from EPA directives.
The Senate version could echo the farm bill the House passed recently in other ways, such as boosting precision agriculture in conservation programs and promoting innovative wood products through the Forest Service.
Another forestry provision in the House bill — requiring the Forest Service to suppress all wildfires in certain high-risk areas within 24 hours — will be on the radar for forest policy groups, as it resembles practices the agency turned away from years ago.
Economic troubles in farm country are helping to propel discussions on the farm bill, the first update since the 2018 law, which expired in 2023 and has been extended since.
On E15, the main questions in the Senate are where to attach the proposal, if not to the farm bill, and what it should say. Bills need a filibuster-proof 60 votes, and the House’s inclusion of provisions related to small refinery exemptions is proving a tough sell to lawmakers who have such facilities in their states — such as Boozman.
South Dakota’s Thune has raised the idea of taking up the House version of the farm bill and pairing it with an E15 measure, although some of the Senate’s biggest ethanol supporters are on the Agriculture Committee assigned with writing a farm bill, including ranking Democrat Amy Klobuchar of Minnesota and Iowa Republican Chuck Grassley.
Grassley told agriculture reporters last week that other possible legislative vehicles include the annual defense authorization or end-of-year appropriations bills.
“It’ll never be up as a separate bill because separate bills take too long,” Grassley said.
Miranda Willson contributed to this report.
