More than US$121 billion in renewable energy investment is at risk in the United States as increased federal oversight exposes 92 GW of utility-scale solar, wind and energy storage projects to heightened permitting scrutiny, according to a new report by Wood Mackenzie.

The report, Federal Friction: Permitting Risk Across the US Utility-Scale Renewables Pipeline, finds that changes to federal permitting processes have already affected project development. In 2025, permitting changes and the withdrawal of federal funding directly contributed to 7 GW of project cancellations or inactivity on federal lands. Looking ahead, an additional 12 GW of projects on federal lands and 80 GW on private lands could face increased regulatory scrutiny, putting more than US$121 billion in investment at risk.

DOI memorandum reshaped federal permitting

According to the report, a Department of the Interior (DOI) memorandum issued on July 15, 2025, centralized federal review across nearly all wind and solar projects.

The memorandum introduced a multi-step approval process that extends permitting timelines and increases regulatory scrutiny for any project involving a federal agency.

Permitting risks differ by technology

Wood Mackenzie notes that permitting risks vary across technologies, although wetland permitting remains the primary constraint for utility-scale solar, wind and energy storage projects.

Wetlands account for the majority of private land exposure, with the highest concentration of risk in Oregon, Alabama, Maine, Minnesota and Montana.

For wind projects, permitting constraints are more closely linked to airspace permitting requirements.

Project cancellations driven by multiple factors

Since 2025, dozens of gigawatts of early-stage capacity have been cancelled or stalled across the solar, wind and energy storage sectors. However, Wood Mackenzie emphasizes that permitting challenges are not the sole cause.

"Since 2025, dozens of gigawatts of early-stage capacity have been cancelled or stalled across solar, wind and energy storage. However, it's important to note that not all cancellations are due to permitting challenges. Some also stem from supply chain constraints and tighter financing conditions," said Kaitlin Fung, Senior Research Analyst at Wood Mackenzie.

Solar has the largest pipeline at risk

The analysis shows that solar has the largest absolute exposure, with 30% of its project pipeline at risk of additional federal review.

Wind faces the highest proportional exposure, with 62% of its pipeline affected, excluding the ongoing Federal Aviation Administration (FAA) halt.

Energy storage is also significantly impacted, as more than one-quarter of planned capacity faces heightened permitting scrutiny.

Following the implementation of the DOI permitting rules, 32% of the early-stage project pipeline is now subject to additional federal review. Early-stage projects include those that have been announced, are under development or have already secured permits.

2029 projects face the greatest exposure

According to the report, projects scheduled to begin operations in 2029 represent the largest volume of capacity at risk of additional review on federal lands.

Wood Mackenzie warns that permitting delays could jeopardize these projects' eligibility for federal tax credits.

The highest exposure is concentrated in Texas, followed by California and Arizona, where increased federal oversight could delay commercial operation dates beyond developers' planned timelines.

Policy developments could ease permitting challenges

The report highlights two policy developments that could significantly influence the permitting outlook.

In April 2026, a federal court issued a preliminary injunction blocking agency actions that imposed new restrictions and expanded review requirements for wind and solar projects, finding them likely unlawful under the Administrative Procedure Act.

While the injunction does not resolve broader permitting bottlenecks, Wood Mackenzie says it limits further disruption and reinforces the need for more coordinated and predictable federal permitting processes.

Separately, the Simplifying Permitting and Ending Endless Delays (SPEED) Act, approved by the House of Representatives in December 2025 and currently awaiting Senate and Executive approval, proposes narrowing the scope of environmental reviews, reducing duplication across federal agencies and introducing stricter permitting timelines.

If enacted, the legislation could significantly shorten permitting timelines for infrastructure projects, including renewable energy developments.

Regulatory uncertainty continues to weigh on investment

"Permitting remains one of the most critical barriers to advancing new projects, and without more coordinated and predictable processes, delays and uncertainty will continue to weigh on development timelines and investment decisions," said Gaby Ackermann Logan, Research Associate at Wood Mackenzie.

"For storage in particular, where development is often tied to solar, permitting uncertainty has a compounding effect. The policy landscape is shifting quickly, and developers who can anticipate where the friction points are will be better positioned to protect their timelines and maintain project bankability."