In 2024, California ranked as the fifth largest economy in the world for the seventh year in a row. It generates 14% of the U.S.  gross domestic product  and is the top state in the country in manufacturing output, businesses, and employment. However, despite this stellar record for industry, the industrial permitting process in California remains long and complicated, particularly for emerging clean industrial projects such as hydrogen production facilities, carbon dioxide removal projects, and other innovative industrial decarbonization technologies. Given that industry is the second largest emitter in the state, at 23% of total emissions, these projects are crucial for meeting California’s climate goals. Industry also currently employs 1.2 million Californians, and deploying new industrial projects in the state will be crucial to keeping – and increasing – those jobs as older technologies retire.  However, they face significant permitting challenges that can delay or even prevent their deployment. While state agencies, legislators, and local permitting bodies have been working for decades to improve the process and support deployment, many industrial projects still struggle to get permitted in a timely manner.

Solutions for these delays and cancellations exist on both sides of the permitting process: policymakers can streamline procedures without compromising environmental review or community justice elements, and permit-seekers can follow best practices to avoid common delays. Based on interviews with more than two dozen industrial permitting stakeholders and two stakeholder convenings, this memo outlines key challenges and solutions to begin improving the California permitting process for clean industrial projects ranging from clean fuel refining, to cement plants, to steel production, and more.

 (Note: This work is focused on ways to improve the permitting process for industrial infrastructure across many non-power sector industries. Power generation and transmission infrastructure were not included, given their unique permitting needs and challenges).

Before starting construction, clean industrial projects must navigate permits across three levels of government — local, state, and federal — each level being responsible for different aspects of project approval. While local authorities typically have the first and final say on project approval, permits at any level can influence where, how, and whether a project gets built.

The complexity of the process for any given project varies significantly based on type, size, and location but projects may require many of the permits below:

• Local permits cover building, fire safety, zoning, and other site-specific requirements, and can also include local preferences from communities like required green space, amenities, and specific aesthetic design requirements.
• State permits include environmental reviews, such as the California Environmental Quality Act (CEQA), Clean Air Act Title V Permitting, the Industrial General Permit, and Hazardous Waste Permits.
• Federal permits may include National Environmental Policy Act (NEPA) review and Army Corps of Engineers 404 permit approval for projects affecting waterways.

A fundamental feature of California’s permitting process is that much of it is decentralized. Local permits are developed and approved by the hundreds of city and county-level authority-having jurisdictions (AHJs), while various state-level permits can be administered by one of the thirty-five local Air Districts, one of the nine local Water Boards, or one of the 81 Certified Unified Program Agencies (CUPA). This adds challenges to improving the permitting process. For example: staff capacity for permitting is a commonly cited challenge, but given that the locus of permitting is decentralized, simply ‘adding capacity’ to the relevant agencies would require hundreds of staffers across the state, often paid for with city and county budgets, rather than adding a handful of staff at a centralized state-level agency.

Each of these permits fundamentally exists to prevent adverse outcomes for local communities, the environment, or the state, and some project managers have reported that permits can also benefit the projects themselves by ensuring that engineering and construction plans are sound and the host community is supportive. However, the existence of so many permits can also present immense challenges for projects, including determining the correct sequencing of applications, providing redundant information across permits, and navigating comment and feedback timelines from permit approvers.

These benefits and challenges represent the difference between productive friction and nonproductive friction in permitting. An effective state permitting process keeps the productive friction, which requires projects to prove that they will be good neighbors to their host communities, and reduces nonproductive friction, which can unnecessarily delay projects, even to the point of failure, at which point the benefits the project could have brought to the community (climate, economic, labor, and otherwise) are forfeited.

California has a long history of leading the nation in climate action, as well as fostering innovative technologies and industries. Even so,  the coming decade will be crucial to meeting climate goals and avoiding the worst outcomes of climate change, while also creating new economic growth. As innovative clean industrial technologies are developed and nurtured by the influx of financial support from federal programs like the Inflation Reduction Act and the CHIPS and Science Act, startups and incumbent companies alike are looking for friendly geographies to site their new projects.

California must make it a priority to welcome and support such technologies. Good work is already being done — the Governor’s Infrastructure Strike Team is tasked with streamlining funding and approval for projects in the state, the legislature has passed bills like AB 1236, AB 970, and SB 1418 which target specific industries like charging and hydrogen fueling stations to encourage infrastructure deployment, and the California Governor’s Office of Business and Economic Development (GO-Biz) has published resources and guidebooks for specific permitting pathways. But many companies continue to report serious challenges in permitting, which at the very least result in delays, and at most lead them to cancel projects or to leave the state and deploy their projects elsewhere. This issue is especially challenging for insurgent technologies and startups, which likely do not have the resources to hold onto a parcel of land for years on end while they wait for permit approvals — meanwhile incumbent, and often dirtier, technologies do.

In order to maintain its status as a leading location for visionary and climate-friendly companies, California must do more to improve the permitting process and support new infrastructure deployment.

Even though the process of permitting is in the hands of local and state-level authorities, actually getting a project permitted is a joint effort between the company seeking the permit, the local community, and the relevant permitting jurisdictions. To that end, the recommendations below target both sides of the equation: there are steps that can be taken by both companies and policymakers to reduce nonproductive friction and decrease delays — without sacrificing the safety, environmental justice, or community review of the project.

For Permit-Seekers

1. Be Strategic with Site Selection

When choosing a site for a project — if possible — prioritize locations that are already zoned for industrial use, have existing similar projects, or have undergone comprehensive environmental assessments. This increases the likelihood that the local permitting jurisdictions are familiar with the process of assessing and approving new clean industrial technologies. It also can avoid confusion as to how a new technology should be classified for permitting, which can delay and prevent projects.

2. Be Proactive with Local Community Engagement

The communities near a new industrial site should be treated as hosts, not obstacles. It is imperative that companies clearly communicate project risks and benefits in multiple formats (e.g., meetings, websites, office hours) above and beyond what is required by permits, and consider what local values and concerns might be. Additionally, project managers should establish early and open communication with local planning offices, including in-person meetings if feasible.

3. Utilize Third-Party Validation for An Additional Layer of Assurance

Permitting unique or novel projects can put extra pressure on permitting offices to ensure that the project will be safe for local communities, especially if it is unfamiliar technology. Engage a reputable local third-party engineering firm to validate project plans and safety to add an additional layer of assurance to permitters signing off on projects.

4. Consider hiring expert consultants to help navigate the permitting system

Even with the best-laid plans, the permitting process can quickly become more complex than expected, especially for new technologies that may be unfamiliar to local permitters. Hiring consultants with deep experience with relevant regulatory agencies ensures that they can help navigate particularly tricky permitting processes. An added benefit if a consultant has experience with the other side of the permitting process is that they will be able to “translate” both the information needs of the local permitting offices and the complexities of the proposed project to limit misunderstandings between permitter and permittee.

5. Leverage State Resources

GO-Biz offers numerous resources to companies looking to build in California. Utilize free resources provided by GO-Biz, including permitting guidebooks for specific industries, expert personnel, and permit mediation in the event a permit stalls out at the local or state level.

For State Policymakers, Agencies, and Authority Having Jurisdictions

1. GO-Biz Can Clarify and Standardize the Permitting Processes When Possible

While GO-Biz does not have direct jurisdiction over local permitting processes, localities often look to them for guidance on navigating challenging permitting issues. GO-Biz could develop and publish more industry-specific permitting guidebooks (like the EV charging guidebook) for targeted emerging technologies like hydrogen production sites and carbon dioxide removal. This gives clarity to companies navigating the process and can also aid local jurisdictions in developing permitting pathways for first-of-a-kind technologies, leading to more standardized processes across the state.

2. Legislature Can Learn from the Successes and Challenges of Existing Permitting Laws

The state legislature could use the lessons from existing permit-smoothing bills like AB 1236 and AB 970 to improve future attempts at improving the process. Those laws have been successful in that they prove that targeted permit streamlining legislation does indeed reduce permit wait time, and the Zero Emission Vehicle Division of GO-Biz has been working tirelessly to bring localities into compliance with such laws. has been working tirelessly to bring localities into compliance with such laws.

There are lessons to be learned in future legislation. For example, current laws that aim to expedite vehicle charging station permits only speed the permits that are directly related to the charging infrastructure. However, projects are still getting delayed by the other permits they need for the project, including those for features like on-site bathrooms, retail amenities, or retaining walls. Furthermore, localities are not always aware of the statewide legislation that impacts them and often need support to come into compliance. Legislation that impacts local permitters must come at the very least with clear instructions to localities on what is needed from them, and ideally also with state-level financial and personnel resources to help localities to comply.

3. Investigate How to Effectively Centralize Some Permitting, Especially for First of a Kind Technology

Many stakeholders in the industrial permitting world have raised the idea of offering localities a pathway to outsource permitting to state-level agencies or private contractors when their queue is too long, or they feel unequipped to safely permit an unfamiliar technology. While this might be an effective solution to some of the most pressing permitting issues, including local staff bandwidth and lack of background in cutting-edge technology, it must ensure that centralizing the permitting process for some cases does not reduce community oversight of projects and maintains the appropriate level of scrutiny on projects. The Governor’s Office or Legislature could request a study be done to determine if, when, and how permitting could be outsourced in certain situations. The results of this study can then guide future rulemakings and legislation to speed the permitting process for all industries safely and fairly.

4. Legislature Could Take Action to Improve CEQA By Maintaining Productive Friction and Reducing Nonproductive Friction

CEQA — which is similar to but more ambitious than NEPA — has been an effective tool for ensuring that proposed projects consider and mitigate negative impacts on the communities and the environment of California for more than half a century — in other words, it provides a significant amount of productive friction. But  it also stands as one of the largest sources of nonproductive friction in the permitting process as well, often taking well over a year to be approved, and sometimes going into three or more years. As a result, there have been calls from many corners of the industrial landscape to improve, overhaul, or even to eliminate CEQA.

While eliminating CEQA could have serious repercussions, if California is serious about attracting the next generation of industrial technology, the CEQA process should be improved, likely by legislative action. Some ways to maintain productive friction and reduce nonproductive friction include assessing the CEQA permitting process for redundancies with other major permits, like Title V Air Quality Permits and the California Industrial General Permit and either eliminating the duplicative pieces in CEQA or allowing CEQA approval to expedite the approval of additional and at times redundant permits. It could also include limitations on legal challenges or allowing the permitting process to continue during legal challenges that are not environmentally related. Additionally, it could mean expanding the list of categorical exemptions to match that of NEPA, which has a more extensive list of exemptions, and would allow for faster approval of well-understood and low-risk project types.

It is important to note that CEQA has been a foundational tool for improving or blocking projects that would be harmful to communities, local environments, and the climate. Any changes to its process must be carefully written to ensure that these crucial stopgaps are maintained to prevent bad actors from capitalizing on an overly permissive permitting environment. While the goal may be to ease the overall permitting process to enable development of the clean technologies of tomorrow, we must ensure that rigorous environmental standards are maintained, and community safety remains at the forefront of regulation.

The permitting process in California is complex and work-intensive on both the side of the permit-seeker and the permitting agencies and local governments. As a result, improving the permitting process for clean industrial projects will require coordinated effort from both policymakers and project developers. Policymakers must create clearer, more standardized processes while maintaining environmental and safety standards. Project developers must approach permitting strategically and engage proactively with communities and officials. Success in streamlining these processes is crucial for California to maintain its leadership in clean technology deployment, employment, and in meeting its climate goals.

About Clean Industrial Hubs

The insights above come from RMI and the Mission Possible Partnership’s Clean Industrial Hub work in Los Angeles, California, which accelerates industrial and heavy transportation decarbonization in the region. Clean industrial hubs bring together policymakers, financial institutions, project developers, and community-based organizations to enable groundbreaking decarbonization projects in the hardest-to-abate sectors. In Los Angeles, RMI and MPP’s analyses, convenings, and tools support stakeholders working to advance zero-emissions trucking, low-carbon cement plants, sustainable aviation fuel, and decarbonized ports, by increasing the size, scale, and speed of critical climate investments that benefit the environment, the economy, and communities. This work is done in partnership with the Bezos Earth Fund.