Update of the first phases of the CEQ of the law on the national policy of the environment

On Wednesday, April 20, the Environmental Quality Council (EQC) finalized the first of two phases of regulatory updates to the National Environmental Policy Act (NEPA) regulations (the 2022 rule). The 2022 rule reverses a number of changes in the NEPA review regulations finalized by the Trump administration in 2020 (the 2020 rule) and reinforces President Biden’s executive order to the CEQ to ensure that clearance decisions take into account the effects of greenhouse gas emissions and climate change.1

The 2022 rule will affect all federal agencies and projects triggering NEPA’s environmental review. In particular, the 2022 rule will be critically important to federal agencies seeking to implement Biden administration policies to expand renewable energy. For example, the Biden administration has set goals for the development of 25 gigawatts (GW) of renewable energy on federal lands by 2025.2 and 30 GW of offshore wind power by 2030.3 These onshore and offshore projects, and their supporting infrastructure, will be subject to NEPA review.

THE 2022 RULE IN CONTEXT

NEPA regulations, originally issued in 1978, remained unchanged until the Trump administration revised regulation in 2020. Through the 2020 rule, the Trump administration sought to facilitate “more effective, efficient, and timely NEPA reviews.”4

Upon taking office, the Biden administration immediately sought to change the 2020 rule. In January, CEQ announcement proposed “Phase 1” rulemaking targeting three changes to the 2020 rule, and on April 20, 2022, CEQ announced the 2022 rule implementing those changes:5

  1. Eliminate language requiring agencies to base the statement of intent and need for a project on the applicant’s objectives and agency authority when an agency has a legal obligation to review an application for a permit or other authorization (§§1502.13, 1508.1(z )). This change removes a portion of the 2020 rule that limited the discretion and flexibility of federal agencies to consider alternative project designs or approaches that are not entirely consistent with the goals of the project sponsor.

  2. Reinstate NEPA CEQ regulations as a baseline for federal agencies’ NEPA standards and procedures for NEPA implementation (§ 1507.3). This change makes NEPA’s CEQ regulations the “floor” rather than the “ceiling” for NEPA environmental reviews, providing federal agencies with the flexibility to tailor NEPA procedures to the specific needs of each agency and its stakeholders.

  3. Going back to the previous definitions of “effects”, thus requiring the consideration of cumulative impacts and indirect effects (§ 1508.1(g)). This change ensures that federal agencies’ NEPA documents assess all relevant environmental impacts resulting from federal action, including climate change impacts.

The only significant change between the proposal and the 2022 rule is the addition of a “reasonably foreseeable” clause in the definition of “effects”, retaining the definition of “effects” and “impacts” as “changes on the human environment from the proposal”. action or alternatives that are reasonably foreseeable.” As explained in the preamble to the 2022 rule, the proposed rule had removed the “reasonably foreseeable” clause that had been added in the 2020 rule because CEQ assumed that reasonable foreseeability was still central to the definition of effects.6 However, after reviewing the comments submitted, CEQ explained that “this clause enhances clarity in accordance with long-standing agency practice and NEPA case law.”7

According to a White House press release, the 2022 rule establishes the CEQ’s NEPA regulations as a “floor, rather than a ceiling,” for environmental review standards that federal agencies should meet, noting that “[t]The proposal restores the ability of federal agencies to tailor their NEPA procedures, in accordance with NEPA CEQ regulations, to help meet the specific needs of their agencies, the public and stakeholders.8

THE UNCERTAINTY REMAINS

CEQ Chair Brenda Mallory sees the 2022 rule as restoring basic NEPA safeguards that “will provide regulatory certainty, reduce conflict and help ensure projects are built right the first time.” However, the back and forth between the 2020 rule and the 2022 rule injects some uncertainty into NEPA’s review processes at a time when the federal government is looking to fast-track infrastructure projects.

For example, despite CEQ’s efforts to return to certain fundamental elements of the 1978 rule, judicial and agency interpretations of NEPA regulations that were developed between 1978 and 2020 may have limited applicability. There are also ongoing litigation cases brought by environmental groups challenging the 2020 rule, creating further uncertainty, although the Justice Department may decide to stay or dismiss litigation in light of the 2022 rule. , the Biden administration and federal agencies have yet to announce clear policies with defined processes to implement NEPA in an effective and coordinated manner. Without explaining how to handle these challenges to NEPA implementation, Mallory states that “[p]closing these gaps in the environmental review process will help projects be built faster, be more resilient, and deliver greater benefits to people who live nearby.9

In addition to the targeted changes to the 2020 rule, the 2022 rule leaves in place a number of changes from the 2020 rule. These include, for example: requiring environmental impact statements to be completed within two years and environmental assessments within one year; aggregate categorical exclusions for use across multiple agencies; consider comments only if they are “exhaustive”; and the exclusion of small projects from NEPA review.

Additionally, CEQ intends to release “Phase 2” regulations that will “more broadly review the NEPA 2020 regulations and propose new revisions” to the NEPA regulations.ten This two-phase approach suggests that broader revisions could come from the CEQ, but the details of this second phase remain elusive.

The result is that uncertainty will remain. Despite an effort to take some steps forward in streamlining the NEPA process, it is unclear whether the 2022 rule will have the desired effect. The thrust of the 2022 rule is to reinsert long-standing definitions and practices to ensure comprehensive environmental review, consistent with Congressional policy. Given its narrow scope, the 2022 rule may have limited practical impact on NEPA timelines. There is little in the 2022 rule to guide agencies and project proponents in effectively carrying out rigorous NEPA assessments. Given the sweeping changes implemented in the Trump-era 2020 Rule, the disparate revisions to the 2022 Rule, and broader revisions to come, the regulated community should seek guidance in navigating this new era of NEPA processes.

FOOTNOTES

1 https://www.federalregister.gov/executive-order/14008

2 https://www.doi.gov/sites/doi.gov/files/mou-esb46-04208-pub-land-renewable-energy-proj-permit-coord-doi-usda-dod-epa-doe-2022- 01-06.pdf

3 https://www.energy.gov/articles/energy-secretary-granholm-announces-ambitious-new-30gw-offshore-wind-deployment-target

4 https://www.federalregister.gov/documents/2020/07/16/2020-15179/update-to-the-regulations-implementing-the-procedural-provisions-of-the-national-environmental

5 https://www.federalregister.gov/documents/2022/04/20/2022-08288/national-environmental-policy-act-implementing-regulations-revisions

6 ID.

7 ID.

8 https://www.whitehouse.gov/ceq/news-updates/2022/04/19/ceq-restores-three-key-community-safeguards-during-federal-environmental-reviews/

9 https://www.whitehouse.gov/ceq/news-updates/2022/04/19/ceq-restores-three-key-community-safeguards-during-federal-environmental-reviews/

ten https://www.federalregister.gov/d/2021-21867/p-49

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