The Federal Energy Regulatory Commission is likely to scale back scrutiny of liquefied natural gas projects in the wake of recent presidential executive orders and a D.C. Circuit ruling that gave the agency another chance to review projects in Texas.

The US Court of Appeals for the D.C. Circuit earlier this week remanded to the agency a challenge to FERC’s reapproval of two LNG terminals and a pipeline rather than vacate those reauthorizations, reversing a decision the court rendered last year.

Attorneys and scholars say the ruling is a signal that FERC and the courts will require fewer environmental justice obstacles before such projects can go forward.

As part of an effort to undo diversity, equity, and inclusion initiatives, President Donald Trumprescinded several executive orders. That included one from the Clinton era thatdirected agencies to address environmental justice in their decision making by taking into account any potential adverse effects on minority and low-income populations.

FERC now can look at the Texas projects and possibly others without that additional analysis.

“I think the big takeaway of this case is that the Trump administration is starting to chip away, slash, rescind a lot of the regulatory burdens that are coming through executive orders as it pertains to environmental considerations, and this case may be one of the first big ones that we are seeing within the liquefied natural gas exporting arena,” said Ryan J. Regula of Snell & Wilmer LLP.

The decision also puts the ball squarely in FERC’s court to determine how Trump’s orders will play into its considerations for approving and reapproving energy projects.

The D.C. Circuit declined to rule on FERC’s argument that the Clinton-era executive order that Trump wiped out meant the reauthorizations shouldn’t be vacated, instead leaving the answer to the agency.

And that gives the developers hope their challenged projects will be revived.

The court is saying “we leave it to the commission to have the first word on these implications,” said Christine Tezak, senior director at energy research firm ClearView Energy Partners LLC.

FERC’s most powerful point in its argument was that it “has now done two analyses—has shown that there’s very minor environmental impacts and great economic impact” from the Texas projects, said William Snape, a fellow and practitioner-in-residence at American University’s Washington College of Law. “I think that gives you an idea of what FERC’s analysis is going to be.”

“It does not appear this Trump FERC is going to dive deep into more environmental justice analysis,” he said.

Added Guidance Rescinded

Executive orders aren’t legally binding, but they provide guidance on the direction agencies should take to implement a president’s policy goals.

And they provide additional fodder for those challenging agency decisions in court.

Regula pointed to a line in the D.C. Circuit opinion saying “recent executive orders have potentially altered the relevant legal landscape.”

In the absence of orders requiring additional analyses before approving LNG projects, that means “if the environmental considerations are not listed in statute, they don’t apply,” he said.

“The challenge for the opponents is that there no longer is an executive order on environmental justice they can rely on to say what FERC did wasn’t good enough” when it approved a project, Tezak said.

The Administrative Procedure Act is “certainly one of your remaining strategies,” she said.

‘Off the Table’

The focus on statutory compliance signifies not only a heavy emphasis on a law’s text, but also a narrowing of the issues FERC will consider in its reviews.

For future LNG projects or projects under the Natural Gas Act’s jurisdiction, “we are likely to see a continued narrowing of FERC scope,” Tezak said. “And to be clear, FERC was not an agency that went very broad with scope, particularly with greenhouse gases.”

Issues that are “off the table” for FERC to consider on this remand include the environmental impacts on disadvantaged communities and any requirements dictated by the White House Council on Environmental Quality, Regula said.

The CEQ’s regulatory authority was wiped out with Trump’s revocation of a 1977 executive order.

Air quality may come into play because those issues “are rooted in the Clean Air Act” rather than in an executive order, Regula said.

But “what’s actually being reviewed is going to have a very narrow scope,” he said.

The case is City of Port Isabel v. FERC, 2025 BL 89985, D.C. Cir., No. 23-1175, 3/18/25.