CEQ Finalizes Rescission of NEPA Implementing Regulations

Regulatory Background and Context
CEQ’s 1978 NEPA implementing regulations were issued pursuant to President Carter’s EO 11991, which directed the agency to issue NEPA regulations and required other federal agencies to comply with CEQ’s regulations. President Trump’s EO 14154 (issued January 20, 2025) rescinded EO 11991 and directed CEQ to propose rescinding its NEPA regulations and transition to guidance and interagency coordination as agencies revise their own NEPA procedures. CEQ issued initial NEPA implementation guidance on February 19, 2025, and then issued the IFR on February 25, 2025, with a 30-day comment period that closed March 27, 2025.

CEQ situates the rescission in the wake of Seven County Infrastructure Coalition v. Eagle County, 145 S. Ct. 1497 (2024), noting that since the decision was issued, “all three branches of government at the highest possible levels—Congress, the President, and the Supreme Court—have called for, authorized, and directed NEPA reform.”

January 8, 2026, Final Rule
The final rule adopts the IFR without modification, stating that none of the comments undermined or altered CEQ’s core conclusion: In absence of EO 11991, CEQ lacks authority to issue regulations binding on other agencies.

CEQ’s responses to comments on the IFR focus on several recurring themes:

1. CEQ’s asserted lack of independent statutory rulemaking authority under NEPA.

   CEQ emphasized NEPA’s provisions describing CEQ’s consultative and advisory role—particularly NEPA’s direction that agencies develop their methods and procedures “in consultation with” CEQ (42 U.S.C. § 4332(2)(B))—and argued those provisions do not delegate legislative rulemaking authority to CEQ. CEQ further emphasized that Congress has elsewhere expressly granted rulemaking authority when intended, underscoring CEQ’s view that NEPA does not implicitly confer legislative rulemaking power.

2. Relationship between presidential delegation and CEQ’s historical regulations.

   CEQ stated that while it promulgated and amended NEPA regulations over decades, each iteration relied on EO 11991’s delegation and direction; once that delegation was rescinded, CEQ concluded it was required to remove its regulations from the CFR.

3. Comments asserting congressional ratification or judicial recognition of CEQ’s authority.

   Several commenters asserted that Congress ratified CEQ’s authority through later NEPA amendments (including the Fiscal Responsibility Act of 2023) or through statutory cross-references to CEQ’s regulations, and that the Supreme Court affirmed CEQ’s authority to promulgate binding regulations. CEQ responded that, although Congress codified certain NEPA procedures, it did not grant CEQ rulemaking authority and that the cross-references generally define terms or processes rather than confer regulatory power. With respect to Supreme Court precedent, the CEQ characterized the relevant statement in Dep’t of Transp. v. Public Citizen, 541 U.S. 752, 757 (2004) as dictum, noting that the Court did not analyze the source of CEQ’s authority in other NEPA cases before it.

4. Procedural objections to the IFR process and timing.

   CEQ acknowledged receiving requests for longer comment periods, delayed effectiveness, and public hearings, but maintained the 30-day comment period provided before the IFR took effect was sufficient, particularly in light of the IFR’s limitation to rescinding regulations and did not revisit the substance of prior NEPA rulemakings or address technical issues.

   CEQ further stated that the January 8, 2026, final rule “supersedes” the IFR, thereby curing any error in failing to give the public an opportunity to comment before issuance of the IFR, a position that appears intended to address anticipated Administrative Procedure Act procedural challenges.

5. Consequences and reliance interests.

   CEQ characterized many of the asserted harms flowing from recission (e.g., agency and judicial confusion, increased litigation, project delays, weakened environmental review) as speculative and reiterated that agencies will continue to be bound by NEPA’s statutory requirements and their own NEPA procedures.

   CEQ also addressed comments asserting that agencies, project sponsors and courts have long relied on CEQ’s NEPA regulations as a stable, uniform framework and that rescission would upset settled reliance interests developed over decades of practice. CEQ responded that any such reliance does not outweigh its conclusion that it lacks discretion to retain binding regulations absent presidential delegation, again emphasizing that NEPA’s statutory obligations remain in force and that agencies’ own NEPA procedures are the appropriate source of procedural reliance going forward. CEQ further rejected the view that longstanding practice or judicial reliance can supply rulemaking authority where none exists, concluding that reliance interests cannot overcome the absence of a current delegation of authority. Finally, CEQ pointed to the Supreme Court’s decision in Seven County as reinforcing its position that NEPA’s operative constraints derive from the statute, not from CEQ’s regulatory framework, and therefore diminishes claims that regulated entities or agencies can rely on CEQ regulations to expand or perpetuate NEPA obligations beyond what the statute permits.

What’s Next
The final rule formalizes a decentralized NEPA regulatory implementation landscape in which agency-specific NEPA procedures function as the primary operational framework. Since publication of the IFR in February 2025, a growing number of federal agencies have released new or updated NEPA regulations or guidance, including the Departments of War, Energy, Agriculture, Transportation, the National Oceanic and Atmospheric Administration, the Federal Energy Regulatory Commission, and the Economic Development Administration.

In updating their NEPA frameworks since EO 14154, many agencies—including the Departments of Energy, Interior and War—have shifted away from detailed notice-and-comment regulations and toward more flexible guidance documents, citing the ability to update guidance more efficiently as agency practices evolve. Other agencies, such as the Federal Energy Regulatory Commission and Department of Transportation, have retained a limited set of formal NEPA regulations supplemented by interpretive guidance. As NEPA implementation continues to fragment across agencies, project proponents and other stakeholders will need to closely track and apply the specific NEPA procedures and guidance of the relevant lead agency.

The final rule is also being implemented against the backdrop of renewed congressional interest in statutory NEPA reform. In December 2025, the U.S. House of Representatives approved H.R. 4776 (the SPEED Act). The bill would codify a series of procedural changes aimed at expediting federal environmental reviews, including shortened timelines for completion of NEPA analyses, limits on judicial review, and restrictions on agencies’ ability to revisit previously issued approvals.

Pillsbury’s Environmental practice will continue to monitor developments and provide updates on the evolving NEPA landscape.