The U.S. Environmental Protection Agency (EPA) has proposed an important change to the Clean Air Act’s New Source Review (NSR) preconstruction permitting program: a clearer separation between the construction of the non-emitting structures and support equipment and the regulated source itself. If finalized, the proposed rule revision would let owners and operators start building certain non-emitting components or structures before receiving an NSR permit for a new stationary source or a major modification. EPA’s press release on May 11, 2026, cites removing unnecessary delays for projects such as power generation, manufacturing, and data centers, while still requiring permits before construction begins on equipment that have the potential to emit regulated NSR pollutants.
What is changing?
Under current rules, companies generally must obtain an NSR air permit before beginning “actual construction” on a project. Historically, EPA and state permitting authorities have interpreted this broadly to include many types of on-site work, including some permanent structures that support a facility, even if those components do not individually or specifically emit air pollutants. In many jurisdictions, this even prohibits activities such as pouring concrete foundations ahead of installing the project’s equipment without a permit in hand.
EPA’s proposal would expand the existing definition for “begin actual construction” and add a definition for “pollutant-emitting activities.” Although this new term specifies which portions of the construction are pollutant-emitting, the two definitions combine to clarify the pre-construction activities that can begin prior to an issued NSR air permit. This effectively relaxes current restrictions on low- and non-emitting construction activities. The proposed definition changes are posted in the Federal Register and read as follows (underline added for emphasis):
- Begin actual construction means, in general, initiation of physical on-site construction of pollutant-emitting activities on a stationary source. This does not include the following:
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- Engineering and design planning
- Geotechnical investigation (surface and subsurface explorations)
- Clearing vegetation, grading, surveying, soil compacting and stabilization (including associated pile driving), and excavating land (including blasting or other removal of hardrock)
- Ordering of equipment and materials
- Storing of equipment or setting up temporary trailers to house construction management or staff and contractor personnel
- Paving surfaces
This list is not intended to be exhaustive. With respect to a change in method of operations, this term refers to those on-site activities other than preparatory activities which mark the initiation of the change.
- Pollutant-emitting activities, as used in 40 CFR 52.21(b)(6)(i) and (b)(11), include any equipment or component in a process or operation that emits or has the potential to emit a regulated NSR pollutant. Pollutant-emitting activities do not include the following:
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- Office buildings
- Retail stores
- Buildings or structures designed for storage if the product or material to be stored therein is not capable of producing airborne vapors or particles
- Concrete pads and building foundations, walls, and roofs that are not closed in on the interior side and do not have design elements (e.g., piping, ductwork, wiring, anchor bolts) specifically and uniquely configured to serve or support any equipment or component in a process or operation that emits or has the potential to emit a regulated NSR pollutant
- Equipment or components whose sole purpose is heating ventilation and air conditioning for human workspaces or spaces within a building used to store supplies related to the habitation of the building
- Wiring, piping, and associated support structures that supply utility services (including electrical, water, wastewater, or telecommunications) to a property site or a building on a site
- Sealed junctions or tie-ins within one process that may serve equipment or components in another process constructed at a later time
This list is not intended to be exhaustive. For purposes of this definition, classification as pollutant-emitting is based on emissions from a process or operation after construction, not emissions of pollutants during the construction process.
- Commence construction [40 CFR 49.152] means, as applied to a new minor stationary source or minor modification at an existing stationary source subject to this subpart, that the owner or operator has all necessary preconstruction approvals or permits and either has:
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- Begun, or caused to begin, a continuous program of actual on-site construction of the source, to be completed within a reasonable time; or
- Entered into binding agreements or contractual obligations, which cannot be cancelled or modified without substantial loss to the owner or operator, to undertake a program of actual construction of the source to be completed within a reasonable time
These changes would narrow the breadth of the “begin actual construction” definition. Instead of requiring an issued permit before any significant on-site construction begins, the revised definition would focus specifically on when construction starts on the equipment or processes that produce air emissions. This distinction opens the door for companies to begin certain non-emitting work earlier, such as building foundations, installing utilities, and constructing supporting infrastructure, before receiving an official air permit. This relies on the condition that the work does not involve the emission-generating equipment.
It is important to note that there are qualifiers on these exemptions. If a building is being constructed with design elements specific to an emission unit, then only the foundation and shell of the building can be constructed prior to permit issuance. This is consistent with the EPA’s letter to the Maricopa County Air Quality Department on September 2, 2025. In this letter, EPA justifies this determination by stating that a building shell is not purpose-built for a specific piece of equipment and thus not integral to project-specific construction.
How does this affect industry construction timelines?
The biggest impact of this proposal is on project scheduling flexibility. Instead of waiting for a permit before beginning all permanent work, operators could start an increased portion of project construction while the permitting process is still underway. For many projects, this could reduce costly downtime between securing a site and mobilizing full construction efforts. Activities like site development, structural work, and utility installation, which are often significant portions of the schedule, may be able to proceed earlier. This also allows for much quicker turnaround from permit issuance to facility uptime.
From a business standpoint, that creates several advantages:
- Shorter project timelines: Overlapping permitting and construction could compress overall schedules.
- Improved capital efficiency: Projects may begin generating progress sooner, reducing idle capital.
- Better contractor coordination: Early mobilization of civil and structural teams becomes more feasible.
- More flexibility: If a project is awaiting permit issuance, then the pre-construction timeline has more flexibility in completion. This can significantly decrease costs by scheduling construction crews on more advantageous dates, decreasing fees for expediting labor and materials.
At the same time, the proposal does not eliminate pre-construction permitting requirements; it simply shifts where the line regarding authorized pre-permit construction activities is drawn. Companies will still need an NSR permit before installing or constructing any equipment that emits regulated pollutants. That means project teams will need to carefully define what work qualifies as “non-emitting” and what does not. EPA guidance emphasizes that these determinations may still be evaluated on a case-by-case basis.
In other words, while the proposal offers more flexibility, it also places greater importance on upfront planning, scope definition, and documentation.
EPA’s timeline
EPA Administrator Lee Zeldin announced the proposal on May 11, 2026, and the proposed rule was published in the Federal Register on May 13, 2026. The rulemaking docket identifies a 45-day public comment period, with comments due by June 29, 2026. EPA held a virtual public hearing on May 28, 2026, which is available for viewing on YouTube.
As for what comes next, there is no legally fixed date by which EPA must finalize the rule. However, the Unified Agenda entry for this action lists September 2026 as EPA’s current target for final action. That date is, of course, tentative and subject to several variables. Companies that operate in multiple states should also be ready for uneven implementation if some agencies move faster than others to adopt or align with the federal approach.
Until a final rule is issued, current requirements remain in place. However, companies planning major projects in the near future should monitor this rulemaking closely and consider how it could affect construction sequencing and permitting strategy.
Bottom line
EPA’s proposed redefinition of “begin actual construction” is less about changing environmental requirements and more about consistency in how projects move forward. By allowing non-emitting construction to begin earlier, the agency is aiming to reduce unnecessary delays without weakening environmental protection.
For operators, the opportunity is clear: faster timelines and more flexible project execution.
Realizing this opportunity will depend on thoughtful planning, scope definitions, and clear recordkeeping. Organizations that start preparing now by evaluating how their projects are structured and scheduled will be best positioned to take advantage of the change if and when it becomes final.
If you would like to discuss how these changes could affect your permitting approach, project timeline, or construction strategy, contact Spencer Roberts from the Ann Arbor, MI office at 734.519.5358 or [email protected].
