EPA Reinstates "No Second-Guessing" NSR Policy: What It Means For Industry

On September 15, 2025, the Environmental Protection Agency (EPA) reinstated a policy from the first Trump administration that the agency would not “second-guess” pre-project emissions projections made by permit applicants in New Source Review (NSR) permitting. Specifically, EPA re-issued a 2017 memorandum, titled “New Source Review Preconstruction Permitting Requirements: Enforceability and Use of the Actual-to-Projected-Actual Applicability Test in Determining Major Modification Applicability.”

Before beginning construction of a project, the Actual-to-Projected-Actual Applicability (APTA) test is utilized to determine whether a proposed project at an existing source triggers NSR permitting by comparing pre-project actual emissions with the projected post-project actual emissions. With the reinstatement of the 2017 policy, EPA is clarifying that "when a source owner or operator performs a pre-project NSR applicability analysis in accordance with the calculation procedures in the regulations, and follows the applicable recordkeeping and notification requirements in the regulations, that owner or operator has met the pre-project source obligations of the regulations, unless there is clear error (e.g. the source applies the wrong significance threshold).” As long as the owner or operator complies with the regulatory requirements, EPA will not “substitute its judgment for that of the owner or operator by ‘second guessing’ the owner or operator’s emissions projections.” The 2017 policy also clarifies that the intent of an owner or operator to manage emissions from a unit after a project is completed is relevant information that may be considered when projecting future actual emissions.

The 6th Circuit's opinion in U.S. v. DTE Energy Co., 711 F.3d 643 (6th Cir. 2013), held that EPA has the authority to pursue enforcement based solely on an allegedly improper projection of future emissions even though actual emissions from the source had not increased. The “no second-guessing” policy indicates that as long as an owner or operator makes a good-faith projection about a project’s emissions increase (or lack thereof), EPA will exercise its discretion and not pursue enforcement “unless post-project actual emissions data indicate that a significant emissions increase or a significant net emissions increase did in fact occur.” EPA will look to the actual emissions during the 5- or 10-year recordkeeping or reporting period to assess whether a significant emissions increase has occurred. As such, the policy indicates that EPA will use its substantial discretion to restrict enforcement for mere projection errors that did not result in post-project significant actual emissions increases or significant net increases and will reserve enforcement for matters where post-project actual emissions indicate that an NSR permit is required. 

EPA’s reinstatement of its “no second-guessing” policy comes on the heels of its September 2, 2025, interpretation of “begin actual construction,” wherein the Agency previewed its current stance on the topic and signaled its intention to amend the NSR regulations to authorize a broader set of construction activities before (or without) receiving an NSR permit. 

Stay tuned for further NSR updates. For more information on air permitting requirements for construction, please contact Liskow attorneys Greg Johnson, Clare Bienvenu, Emily von Qualen, and Colin North, and visit Liskow's The Louisiana Industrial Insights Hub.