EPA Rule Would Allow Construction of Non-Emitting Components Before Permitting

Action: On May 13, the Environmental Protection Agency (EPA) issued a proposed rule to revise the Clean Air Act’s (CAA) New Source Review (NSR) preconstruction permitting program to codify how permitting authorities distinguish between stationary sources and non-emitting components or structures.¹ Companies would be able to begin construction on certain non-emitting components, such as building foundations, before obtaining an NSR permit. Comments on the proposed rule are due June 29.

Trusted Insights for What’s Ahead^®

• The CAA’s NSR program requires certain industrial facilities to obtain permits prior to beginning construction on new pollution sources or making major modifications to existing structures. In practice, companies have often faced uncertainty regarding whether they may proceed with preliminary or non-emitting construction activities before obtaining a permit.²
• The proposed revisions would revise the definition of “begin actual construction” and add new definitions for “pollutant-emitting activities” and “commence construction.”³ It also makes additional changes to clarify the distinction between the construction of a stationary source and the construction of non-emitting components or structures.
• EPA’s new definition of “pollutant-emitting activities” includes “any equipment or component in a process or operation that emits or has the potential to emit a regulated NSR pollutant.” Companies would remain prohibited from beginning construction or installation of such emissions-producing equipment until receiving an NSR permit.
• The proposed rule is intended to support accelerated construction of data center infrastructure, and aligns with the Administration’s goals outlined in a July 23, 2025 Executive Order.
• What this means for business: If finalized, the proposal could shorten development timelines for projects subject to NSR review. Developers may view the proposal as an opportunity to reduce project uncertainty and accelerate construction schedules, particularly for large facilities with long lead times.
  • EPA states that companies may begin construction of non-emitting components or structures “at their own risk” given that the NSR permit could be denied or require major design changes.
  • Developers should coordinate early with state and local permitting agencies as many projects will require approval under state or local programs. Businesses operating across multiple jurisdictions may continue to face variation in implementation, enforcement posture, and litigation risk.⁴