In the evolving landscape of energy infrastructure permitting, recent changes to the National Environmental Policy Act (NEPA) are set to significantly impact the development of projects crucial for powering the burgeoning artificial intelligence (AI) sector. These changes, enacted by Congress, the U.S. Supreme Court, and the executive branch, aim to streamline the permitting process, a move that could accelerate the deployment of energy infrastructure needed to support the AI boom.
Congress has enacted significant bipartisan changes to NEPA through amendments in the Fiscal Responsibility Act of 2023 (FRA) and the One Big Beautiful Bill Act (OBBBA) of 2025. The FRA encouraged more efficient NEPA reviews by defining “major Federal action,” clarifying the scope of NEPA review, and establishing page limits and deadlines for environmental impact statements (EIS) and environmental assessments (EA). The OBBBA further amended NEPA by creating a framework that allows developers to opt in to expedited NEPA review if they pay 125 percent of the anticipated costs to prepare or supervise an EA or EIS. Once a developer pays this fee, the OBBBA directs relevant agencies to complete an EA or EIS in 180 days or one year, respectively.
The U.S. Supreme Court, in Seven County Infrastructure Coalition v. Eagle County, issued a “course correction” for NEPA jurisprudence on May 29, 2025. The Court recognized that lower courts had been aggressive in policing agency compliance with NEPA, leading to unpredictable judicial review and delays in critical infrastructure projects. The Court held that NEPA requires courts to afford agencies “substantial deference” and does not require agencies to analyze “effects from potential future projects or from geographically separate projects.” This decision is likely to improve the NEPA process by providing support for agencies to focus their reviews on impacts associated with their authorizations.
In February 2025, following a landmark D.C. Circuit decision and President Trump’s Executive Order (EO) 14154, Unleashing American Energy, the Council on Environmental Quality (CEQ) published an interim final rule rescinding its regulations implementing NEPA. CEQ directed agencies to revise their regulations to expedite permitting approvals and for consistency with the 2023 NEPA Amendments. On September 29, 2025, CEQ issued revised guidance, which included a template for agencies to use to ensure consistency with recent statutory changes, Seven County, and CEQ directives to streamline and improve permitting.
The Trump administration has focused on streamlining the permitting process, particularly for fossil fuel generation and infrastructure that supports energy dominance goals and data center expansion. Consistent with these goals and CEQ’s directives, the Department of Energy (DOE), Army Corps of Engineers (Corps), and the Department of Interior (DOI), among other agencies, have revised their NEPA procedures to include streamlined processes and clarifications on the limited scope of NEPA reviews.
The demand for electricity from AI data centers is driving investments in new power generation, grid upgrades, and sustainable energy sources. In response, the Trump administration has prioritized increasing the nation’s generation capacity. On Jan. 20, 2025, President Trump signed two EOs—Unleashing American Energy and Declaring a National Energy Emergency—that recognize a robust generation profile as critical for America’s economy and national security. Pursuant to those EOs, several federal agencies enacted “emergency procedures” to expedite their permitting timelines for energy-related projects under statutes including NEPA, the Clean Water Act, the Endangered Species Act, and the National Historic Preservation Act.
In July 2025, President Trump issued a series of AI-related EOs and an AI Action Plan. The EO titled Accelerating Federal Permitting of Data Center Infrastructure calls for accelerated permitting for projects such as natural gas turbines, coal power equipment, nuclear power equipment, geothermal power equipment, and “any other dispatchable baseload energy resources, including electrical infrastructure (including backup power supply)” serving a data center project. The EO directs CEQ and relevant agencies to identify or establish categorical exclusions that could facilitate the construction of qualifying data center projects without preparing an EIS or EA. The EO also authorizes the designation of qualifying projects as “transparency projects” for the purpose of listing on the FAST-41 permitting dashboard and directs the Corps to develop a Clean Water Act section 404 nationwide permit to facilitate efficient permitting for data centers and associated infrastructure.
More recently, the Secretary of Energy directed the Federal Energy Regulatory Commission (FERC) to initiate rulemaking procedures under 42 U.S.C. § 7173 to expedite and facilitate the interconnection of “large loads