Environmental Protection Agency Proposes Flexibility for Pre-Permit Construction Under Clean Air Act New Source Review

On 13 May 2026, the Environmental Protection Agency (EPA) issued proposed rule, “Begin Actual Construction in the New Source Review (NSR) Preconstruction Permitting Program” (91 Fed. Reg. 26958) (Proposed Rule), which seeks to streamline the Clean Air Act’s NSR preconstruction permitting program by allowing source owners or operators to begin certain physical non-emitting construction activities prior to obtaining an NSR permit. If finalized, the Proposed Rule would narrow the scope of activities falling within the scope of “begin actual construction,” allowing for accelerated construction timelines for a wide array of energy and infrastructure projects—including power plants, data centers, petrochemical facilities, and other industrial and manufacturing facilities that require air permits.

Background

The NSR program requires preconstruction permits for new major stationary sources and major modifications at existing major sources under both the Prevention of Significant Deterioration (PSD) and Nonattainment New Source Review (NNSR) programs. As currently written, the EPA’s definitions of the terms “begin actual construction” and “begin construction” in the NSR regulations have been interpreted by EPA in the past to prohibit certain on-site construction activities on or related to an emissions unit, which are of a permanent nature. These activities include the installation of building support structures and foundations, laying underground pipework, and the construction of permanent storage structures. 

Key Takeaways

The Proposed Rule would establish a regulatory distinction between construction associated with source-emitting equipment and construction of non-emitting structures or components. Under the proposed framework, construction of non-emitting components or structures would be able to occur before an owner or operator obtains a permit. Some of these potential components consist of building structural components, foundations, and support structures not integral to emissions units, utility service infrastructure for a site, concrete pads, and other non-emitting structures that are not themselves emission units. 

EPA cautions, however, that construction undertaken prior to permit issuance is at the facility’s “own risk” since a permit application can still be denied or an issued permit may require additional controls that may require a change in project design requirements. In addition, state and local permitting authorities will need to evaluate whether corresponding revisions to state-approved NSR programs are necessary, which could result in varying implementation timelines across jurisdictions.

Policy Rationale

EPA’s rationale for the Proposed Rule is that allowing these limited construction activities to occur prior to permit issuance will not affect the substantive air quality review process required under the NSR program, because no pollutant-emitting equipment would be installed or operated before permit issuance. While, historically, EPA guidance treated many permanent on-site construction activities as prohibited prior to permit issuance, EPA has contended in more recent guidance that portions of that historical interpretation are broader than required by the regulatory text and may unnecessarily delay development projects. The Proposed Rule would now codify that more recent EPA guidance.

Conclusion

EPA is accepting comments on the Proposed Rule through 29 June 2026. Project developers, manufacturers, energy companies, and other regulated entities should closely monitor the rulemaking process and evaluate whether planned projects could benefit from greater flexibility in pre-permit site preparation and construction activities. Our Environment, Land, and Natural Resources practice group is available to work with clients to understand how these regulatory changes may affect their planned capital projects and to develop practical strategies for managing permitting, compliance, and project-development considerations.