Under EPA’s New Source Review (“NSR”) program, an owner or operator must obtain a permit prior to commencing construction of a new major source or a major modification to an existing source. The NSR permitting process can be lengthy, often taking a year or more to complete with complex air dispersion modeling, control technology analyses, agency meetings, public participation, and other attendant requirements. For businesses eager to put a shovel in the ground and begin work on a new facility or a facility expansion, NSR permitting can become a bottleneck on the critical path to complete a project. EPA’s current NSR regulations and guidance around when an owner or operator may commence construction—and what pre-permit construction activities are allowed—have created ambiguity and uncertainty for sources and have been interpreted inconsistently between permitting authorities in different states, leading to complications and project delays.

To address this situation, EPA issued a proposed rule on May 11, 2026 that would distinguish between construction of a stationary source and construction of non-emitting components or structures and codify that the latter can occur before an owner or operator obtains an NSR permit. EPA’s stated goal for the rulemaking “is to more clearly allow entities that plan to build or modify stationary sources of air pollution to engage in construction of non-emitting components (e.g., infrastructure to provide utility service to a site, concrete pads, foundations and other parts of buildings that are not specifically configured for emitting equipment, and office buildings) at their own risk, without altering requirements to control air pollutant emissions from the stationary sources of air pollution that these owners or operators must obtain an NSR permit to construct.” With respect to the risk involved in constructing non-emitting components or structures before an NSR permit is issued, EPA stated that the “rulemaking proposes to enable owners and operators of stationary source to make their own decisions about the degree of economic risk they are willing to bear from the possibility that an NSR permit application is ultimately denied or the possibility that completed construction may need to be reworked to comply with the conditions in an issued permit.”

 EPA is proposing to define “begin actual construction” to mean “in general, initiation of physical on-site construction of pollutant-emitting activities on a stationary source.” EPA is also proposing a definition for a new term, “pollutant-emitting activities,” that would “include any equipment or component in a process or operation that emits or has the potential to emit a regulated NSR pollutant.” EPA is proposing to exclude the following activities from the definition of “begin actual construction,” meaning that they can occur prior to NSR permit issuance: (1) engineering and design planning; (2) geotechnical investigation (surface and subsurface explorations); (3) clearing vegetation, grading, surveying, soil compacting and stabilization (including associated pile driving), and excavating land (including blasting or other removal of hardrock); (4) ordering of equipment and materials; (5) storing of equipment or setting up temporary trailers to house construction management or staff and contractor personnel; and (6) paving surfaces. EPA is also proposing to exclude from the definition of pollutant-emitting activities several types of construction-readiness activities, such as sealed junctions or tie-ins within one process that may serve equipment or components in another process constructed at a later time.            

EPA will accept public comments on the proposal for 45 days after it is published in the Federal Register and will hold a virtual public hearing 15 days after publication in the Federal Register.