NEPA under attack

There have been many changes to the NEPA statute and the CEQ regulations over the last few years. In the last few months, there were two significant events that will change how NEPA will be implemented for the foreseeable future.

A.    Seven County case

The Seven County Infrastructure Coalition v. Eagle County (2025) was a landmark U.S. Supreme Court case that addressed the scope of environmental review required under the National Environmental Policy Act (NEPA). The Court unanimously ruled 8-0 (with Justice Gorsuch not participating) in an opinion by Justice Kavanaugh on May 29, 2025, reversing and remanding the lower court's decision.

The case centered on whether NEPA requires federal agencies to study all reasonably foreseeable environmental effects of proposed projects before approving them. Specifically, the dispute involved whether the Surface Transportation Board should have assessed climate impacts when authorizing an 87-mile rail project that could facilitate fossil fuel development.

The Supreme Court held that NEPA only requires environmental impact statements of government agencies to consider impacts that they have regulatory power over. This significantly narrowed the scope of environmental review, with the Court ruling that Environmental Impact Statements do not have to consider upstream and downstream effects.

This was the first major NEPA case to reach the Supreme Court in nearly two decades. The decision limits the environmental analysis federal agencies must conduct and could make it easier for energy infrastructure projects to receive approval by reducing the scope of required environmental impact assessments. The case had significant implications for climate regulation, as it concerned a fossil fuel project that could lead to 53 million metric tons of carbon pollution each year.

B. No CEQ regulations

On January 20, 2025, President Trump issued Executive Order 14154 directing the Council on Environmental Quality (CEQ) to rescind its NEPA regulations, which were formally removed from the Federal Register on April 11, 2025. The administration also withdrew guidance on greenhouse gas emissions and climate change considerations.

The rescinded regulations had been the first to directly require federal agencies to consider climate change and environmental justice community impacts in their decision-making processes. Without these regulations, agencies are no longer required to conduct comprehensive climate impact assessments for federal projects.

Combined with the recent Supreme Court decision in Seven County, agencies are now limited in analyzing upstream and downstream greenhouse gas effects and are not required to consider environmental effects of separate or geographically distant projects. This significantly narrows the scope of environmental analysis required.

The changes direct agencies to maximize the use of "categorical exclusions" for activities regularly conducted and widely understood to not impact the environment, potentially allowing more projects to bypass detailed environmental review.

The rescission creates several potential environmental risks:

• Reduced oversight of cumulative environmental impacts across multiple projects

• Weakened climate change considerations in federal permitting decisions

• Limited assessment of long-term environmental consequences

• Decreased protection for environmental justice communities that were previously given special consideration

• Faster project approvals that may overlook significant environmental impacts

• Agencies are creating their own NEPA implementing procedures without adhering to NEPA’s purposes or intent. Some agencies are copying the 2020 CEQ regulations such as for the definition of “effects” and the deletion of “cumulative effects” analysis.

These changes reflect an executive order directing officials to "suspend, revise or rescind all agency actions identified as unduly burdensome," prioritizing expedited permitting over comprehensive environmental analysis.

The rescission essentially returns environmental review to a more limited framework, potentially allowing projects with significant environmental impacts to proceed with reduced scrutiny.