Federal environmental regulation in the United States has long been defined by increasing oversight and enforcement—and longer and more difficult permitting processes. Since its founding in 1970, the Environmental Protection Agency (EPA) has wielded expansive authority under landmark statutes like the Clean Air Act and the Clean Water Act, often pushing the boundaries of regulatory power to address complex environmental challenges. And agencies across the government, applying the National Environmental Policy Act (NEPA), have tied up infrastructure, energy, and other projects in lengthy environmental reviews that ran into thousands of pages and bore litigation risk.
That era is ending. The United States has entered a new phase—one of deregulatory momentum—driven by recent U.S. Supreme Court decisions and an aggressive reorienting of executive and agency policy. The implications for regulated industries are profound, presenting both risk and opportunity. Legal practitioners must recalibrate how they counsel clients in this shifting landscape.
The Judicial Catalyst: A Trilogy of Limiting Decisions
Three recent U.S. Supreme Court decisions, each of which predated President Donald Trump’s second administration, fundamentally altered the reach of federal agencies and set the stage for the current EPA rollbacks.
In West Virginia v. EPA (2022), at issue was whether the EPA’s adoption of the Obama-era Clean Power Plan, which aimed to reduce carbon emissions from power plants by shifting electricity generation from coal to natural gas and renewable sources, was a permissible exercise of authority under the Clean Air Act. The court held that the EPA overstepped its authority by attempting to force a generationwide transition without clear congressional authorization. Chief Justice John Roberts, writing for the majority, emphasized the “major questions doctrine,” which requires clear legislative direction when agencies assert regulatory authority over matters of vast economic and political significance. This landmark decision significantly limited the EPA’s ability to craft sweeping environmental rules without explicit statutory backing, casting doubt on similar regulatory efforts across the federal government.
Sackett v. EPA (2023) dramatically redefined federal jurisdiction under the Clean Water Act. The case arose when the EPA informed the Sacketts that backfilling work they had done on their property violated the Clean Water Act due to the presence of wetlands the EPA considered “waters of the United States” (WOTUS). Writing for the majority, Justice Samuel Alito adopted a narrower test for defining WOTUS, requiring a continuous surface connection to relatively permanent bodies of water. The EPA argued that the broader “significant nexus” test espoused in the concurring opinion from Rapanos v. United States (2006) established its jurisdiction over the wetlands at issue. The Sackett decision effectively excluded many wetlands, ephemeral streams, and other marginal waters from federal oversight, greatly reducing the reach of the EPA. As in West Virginia v. EPA, the court prescribed reduced deference to the expertise and discretion of federal agencies, instead leaving ultimate decisions on complex technical and scientific disputes up to the courts.
In Loper Bright Enterprises v. Raimondo (2024), the Supreme Court overturned the Chevron doctrine, which since 1984 had guided courts to defer to reasonable agency interpretations of ambiguous statutes. The dispute in Loper Bright centered on a federal rule requiring Atlantic herring fishermen to pay the salaries of government monitors aboard their vessels—a requirement not explicitly authorized by statute. The Court ruled that under the Administrative Procedure Act, it is the judiciary’s duty to independently interpret statutory provisions, even if they are ambiguous. Writing for the majority, Chief Justice Roberts rejected the presumption of agency expertise and emphasized that judicial deference undermines the separation of powers by allowing executive agencies to effectively legislate. In a continuation of the line of cases listed above, the Loper Bright ruling marks a seismic shift in administrative law, reducing agency discretion and increasing the likelihood that courts will invalidate agency rules lacking unambiguous statutory support.
Note also that in June 2025, the Supreme Court decided Seven County Infrastructure Coalition v. Eagle County, overturning a federal court’s rejection of NEPA review for a proposed rail line, instead finding that NEPA is a primarily procedural statute and the Surface Transportation Board’s NEPA review of the project deserved deference. This case can be read in harmony with Loper Bright, leading to relaxed federal environmental review of major projects.
The Executive Branch Reorientation
While the Supreme Court’s decisions laid the foundation, the current presidential administration has moved aggressively to remake environmental governance.
Permitting: As part of the administration’s push for American energy independence, there has been a marked emphasis on streamlining permitting processes for infrastructure and energy projects. The administration has rolled back NEPA review requirements and expedited permitting for fossil fuel development on federal lands. NEPA reviews of major projects under Seven County, in concert with Trump administration directives to agencies, are likely to be simpler and shorter going forward.
Enforcement: Aggressive enforcement of environmental violations has been deemphasized in favor of voluntary compliance programs and public-private partnerships. Civil penalties and consent decrees have become less common, along with a decline in enforcement actions. As of the end of the second quarter of 2025, the Trump EPA and Department of Justice had brought only three environmental enforcement actions in federal court, a pace that pales in comparison with the more than 60 federal enforcement cases brought in 2024 by the prior administration.
Energy Development: The Trump administration has opened federal lands and waters for energy exploration and production at unprecedented levels, including oil and gas leasing in previously restricted offshore zones and the Arctic National Wildlife Refuge. Wind and solar energy, particularly offshore wind, are now clearly disfavored.
Shrinking the Agency: As part of a concerted effort to downsize the federal government, the EPA offered buyout options to many of its more than 15,000 employees shortly after the president took office. While uptake has not been overwhelming thus far, the cuts have already begun to slow down permitting reviews and have nearly halted enforcement actions, and the EPA’s 2026 budget request calls for a 54% reduction in funding levels.
Collectively, these changes signal a deregulatory philosophy rooted in reducing perceived bureaucratic overreach and promoting economic growth through energy development, while keeping the EPA’s role as limited as possible.
Practical Implications for Regulated Industries
The convergence of judicial oversight and agency rollback demands a new strategic approach for businesses that interact with the EPA or require approval under NEPA and their counsel.
Regulatory Uncertainty Is the New Normal: Ironically, even as the regulatory state is curtailed, uncertainty has increased. The demise of Chevron deference, in particular, introduces greater unpredictability in litigation outcomes. Regulatory interpretations once considered settled may now be subject to de novo judicial review, potentially creating conflicting rulings across jurisdictions. Similarly, in the wake of Seven County, the scope of NEPA review has been thrown into question across all agencies that apply it.
Where possible, regulated companies should wait out this period of uncertainty until agencies and the courts provide further guidance. Where waiting is impractical, practitioners should advise clients to get started soon, avoid staffing-related delays, and conduct rigorous statutory analysis when formulating regulatory and permitting strategies.
Permitting Acceleration and Pitfalls: Industries reliant on federal permitting should prepare for both opportunity and scrutiny. Accelerated timelines may reduce delays for infrastructure and energy projects, but the reduced environmental review could invite more litigation, particularly as the implications of Seven County ripple through the agencies. In addition, reduced staffing at the EPA and other agencies will likely lead to delays in processing applications. And while federal oversight has softened, state attorneys general, citizen suits, and environmental watchdogs remain active, and some states are stepping up their statutory regimes or intensified enforcement to fill the void.
Legal teams should ensure robust internal documentation and stakeholder engagement to mitigate the litigation risks of fast-tracked approvals and should engage with regulators early and often to avoid missteps.
Conclusion: A New Regulatory World
The deregulation wave sweeping through the United States is not merely a temporary political shift. It is undergirded by Supreme Court precedent and structural changes in agency discretion. While the pendulum of regulatory policy often swings with elections, the Supreme Court’s recent decisions are likely to have long-lasting consequences. For regulated industries, the new environment brings opportunity—but also unpredictability. Practitioners must guide their clients through a regulatory framework that is less centralized, more contested, and increasingly shaped by courts and states rather than federal agencies. The new regulatory order may be one of fewer rules, but it is not necessarily one of fewer risks. Navigating this landscape will require sharper legal tools, deeper statutory fluency, and a keen understanding of the political and judicial tides that shape the practice of environmental and administrative law in the years to come.
Reprinted with permission from The Legal Intelligencer, © ALM Media Properties LLC. All rights reserved.
