The White House's Council on Environmental Quality (“CEQ”) recently finalized its “Phase 2” rule, which revises CEQ’s National Environmental Policy Act (“NEPA”) regulations. The rule aims to accelerate NEPA project review by enhancing consistency and clarity of NEPA’s regulations, and also builds environmental justice into the NEPA process.

The new rule imposes one-year deadlines for completion of certain environmental assessments and two-year deadlines for more rigorous environmental impact statements. The rule also gives federal agencies discretion to create categorical exclusions for projects, such as solar storage or transmission upgrade projects, and clarifies that agencies can adopt exclusions established by another agency or jointly establish exclusions. Projects or actions covered by a categorical exclusion are not subject to NEPA environmental review.

Further, the Phase 2 rule directs agencies to consider community input early in the review process, particularly input from those communities that have been disproportionately harmed by pollution or climate change. The rule states that environmental justice reviews are intended to help agency decisionmakers make better decisions by allowing them to be “fully informed about each decision’s reasonably foreseeable environmental effects.”

Some experts agree that the new rule will accomplish its goals by better preparing project developers for more robust discussions with agencies and allowing for consideration of long-term costs and benefits of projects. Others are skeptical, noting that any benefits of the rule’s enactment will depend on the agencies’ efficiency and consistency in incorporating the rule into their regulations and that encouraging agencies to review “environmental justice” aspects of projects could lead to delays in the project approval process.