SCOTUS Unanimously Limits Judicial Review and Narrows the Scope of NEPA Environmental Reviews

While the Trump administration is taking swift action to overhaul the National Environmental Policy Act (“NEPA”) environmental review process, on May 29, 2025, the Supreme Court of the United States (“SCOTUS”) issued an 8-0¹ opinion in Seven County Infrastructure Coalition v. Eagle County—a case about the approval for an 88-mile railroad line—that limits judicial review and may significantly narrow the scope of NEPA analyses. In the main decision, SCOTUS held that (1) courts are to give agencies substantial judicial deference in NEPA cases and should not micromanage agencies’ choices, such as scope, alternatives, and amount of detail, so long as they fall within a “broad zone of reasonableness”; and (2) NEPA does not require agencies to consider the environmental effects of upstream and downstream projects that are separate in time or place from the project in question. Further, an agency is not required to assess the environmental effects of separate projects simply because those projects and effects might not materialize but for the project at hand or are in some sense foreseeable.

This client alert provides a brief background on the Seven County case, breaks down the key takeaways of the SCOTUS decision, and explores the potential implications it may have going forward.

Seven County Opinion

On December 15, 2021, the U.S. Surface Transportation Board (the “Board”)—a federal agency that regulates rail transportation—approved an 88-mile railroad line connecting Utah’s Uinta Basin to the national freight rail network, facilitating the transportation of crude oil to refineries along the Gulf Coast. Pursuant to NEPA, the Board prepared a 3,600-page environmental impact statement (“EIS”) that analyzed numerous effects of the railway construction and operation. Vital to this case, the EIS mentioned, but did not fully analyze, the environmental effects of increased upstream oil drilling in the Uinta Basin and increased downstream refining of crude oil. The Board approved the railroad line, concluding the project’s transportation and economic benefits outweighed its environmental impacts. Eagle County—a Colorado county through which the railroad line was proposed to run—and several environmental groups filed challenges in the U.S. Court of Appeals for the District of Columbia Circuit (the “D.C. Circuit”), alleging that the Board failed to consider, among other things, the upstream and downstream effects when making its decision. The D.C. Circuit found numerous NEPA violations in the EIS. Specifically, the D.C. Circuit held that the Board impermissibly limited its analysis of the environmental effects from upstream oil drilling and downstream oil refining projects, concluding that those effects were reasonably foreseeable impacts that the EIS should have analyzed more extensively. The D.C. Circuit vacated the EIS and the Board’s final project approval.

In the Seven County opinion, SCOTUS held that the D.C. Circuit (1) failed to afford the Board the substantial judicial deference required in NEPA cases; and (2) incorrectly interpreted NEPA to require the Board to consider the environmental effects of upstream and downstream projects that are separate in time or place from the Uinta Basin Railway.

We take each holding in turn.

Substantial Judicial Deference in NEPA Cases

SCOTUS held that courts should afford substantial judicial deference to agency decisions as to the scope and contents of the EIS. SCOTUS emphasized that some federal courts “have assumed an aggressive role of policing agency compliance with NEPA” and clarified that “the central principle of judicial review in NEPA cases is deference.” Under NEPA, an agency’s only obligation is to prepare an adequate report and—unlike other federal environmental statutes—NEPA does not impose substantive constraints on the agency’s ultimate decision. When reviewing an agency’s EIS, “‘the only role for a court’ is to confirm that the agency has addressed the environmental consequences and feasible alternatives as to the relevant project.” SCOTUS reasoned that agencies, not courts, are better equipped to—among other things—determine the amount of detail necessary in any given EIS, identify the significant environmental impacts and feasible alternatives, and establish the scope of the environmental effects that it will address in the review. Regarding the scope for environmental reviews, SCOTUS held that “courts should defer to agencies’ decisions about where to draw the line—including (i) how far to go in considering indirect environmental effects from the project at hand; and (ii) whether to analyze environmental effects from other projects separate in time or place from the project at hand.”

Effects from Upstream and Downstream Projects

SCOTUS held that NEPA does not require federal agencies to consider the environmental effects of upstream and downstream projects that are separate in time or place. Agencies are to consider the environmental effects of a project at issue, not “the potential environmental effects of future or geographically separate projects.” SCOTUS stated that a “separate project breaks the chain of proximate causation between the project at hand and the environmental effects of the separate project” when an agency is considering what environmental effects of the project at hand fall within NEPA’s scope. In other words, if there is no “reasonably close causal relationship” between the project at hand and the environmental effects of that separate project, then those effects do not need to be considered. The opinion did make clear that certain indirect environmental effects from a project fall within NEPA even if those effects might extend outside the geographical territory of the project or may materialize later in time, such as “run-off into a river that flows many miles from the project and affects fish populations elsewhere” or “emissions that travel downwind and predictably pollute other areas.”

In the opinion, SCOTUS reiterated its holding from Department of Transportation v. Public Citizen (2004) that neither a “but for” causal relationship nor mere foreseeability are sufficient to render an agency responsible for a particular effect. As such, an agency is not required to assess the environmental effects of separate projects simply because those projects and effects (i) might not materialize but for the project at hand; or (ii) are in some sense foreseeable.

SCOTUS also noted that the Board did not possess regulatory authority over those separate projects in the first place. As it held in Public Citizen, agencies are not required to analyze the effects of projects over which they do not exercise regulatory authority.

Justice Sotomayor, joined by Justices Kagan and Jackson, issued a concurring opinion agreeing with the main opinion’s bottom line but narrowing the reasoning for the holding. The concurrence established a two-step judicial review analysis.

• Step One (and pursuant to Public Citizen): courts must consider whether the organic statute precludes consideration of a particular issue, and if so, the agency may set it aside for purposes of its NEPA review.
• Step Two: if an agency decides not to review an environmental impact because it finds that the impact is too causally attenuated from the project at hand, courts must ask whether the agency “acted arbitrarily” in doing so and apply a deferential standard of review.

For this case, the concurring Justices found that the matter was resolved in Step One, because NEPA did not require the Board to analyze the environmental impacts of the upstream and downstream projects, given that the Board has no authority to lawfully prevent them. As such, Step Two was not necessary to apply in this case. Justice Sotomayor stated that the majority “unnecessarily ground[ed] its analysis largely in matters of policy” by going beyond its determination that the Board simply had no regulatory authority over the separate projects and therefore was not required to analyze their environmental effects under NEPA.

Potential Implications

Importantly, this opinion comes amid a storm of NEPA developments, which have resulted in uncertainty regarding the scope and process for NEPA reviews. To name a few, in November 2024, the D.C. Circuit held that the Council on Environmental Quality (“CEQ”)—an entity within the Executive Office of the President that has overseen NEPA policy and implementation for over five decades—has no statutory authority under NEPA to promulgate binding regulations. On January 20, 2025, President Trump issued an executive order directing CEQ to: rescind its existing regulations implementing NEPA; issue guidance, which it issued on February 19; and coordinate the revision of agency-specific NEPA regulations to adopt a design that expedites permitting approvals. Agencies have already begun implementing the executive order and CEQ guidance and issuing their own guidance documents.

The Seven County opinion adds additional NEPA uncertainty. With the NEPA developments outlined above and without the CEQ regulations to provide a framework, agencies will independently be determining where to draw the line on various factual NEPA questions, such as scope, alternatives, and amount of detail. This may lead to inconsistent approaches across the various agencies, which leaves project proponents uncertain as to how an agency will be conducting its NEPA reviews. In addition, in the near term, the Seven County opinion may result in project delays as the agencies work through how the opinion should be implemented. 

While it is uncertain exactly how the Seven County opinion will be implemented, it will likely result in narrower NEPA reviews. The opinion narrows the upstream and downstream effects that must be considered in NEPA reviews. In Seven County, opponents were pushing the Board to consider the effects of the upstream oil drilling and downstream oil refining that will result from the project at hand. While the D.C. Circuit agreed those were indirect effects that needed to be analyzed, SCOTUS held that it was up to the agency to decide if they were too attenuated. In other words, the Seven County opinion held that agencies do not need to consider those upstream and downstream effects even if they are within the agency’s control to regulate. This may result in agencies focusing their analysis on a project’s more direct effects and limiting the indirect effects considered, arguing that many of the indirect effects are too attenuated. Also, with the Trump administration pushing to expedite permitting approvals and streamline NEPA reviews, federal agencies may exercise the “substantial discretion” afforded by SCOTUS to narrow the scope of environmental impacts and alternatives to be analyzed, which could result in agencies removing or substantially minimizing analyses regarding climate change and pollution. This streamlining and approach would be consistent with President Trump’s recent NEPA directives and CEQ’s February 2025 guidance to federal agencies on implementing NEPA. Notably, the Seven County opinion addresses deference to the agencies’ factual NEPA judgments; whereas, last year’s Loper Bright Enterprises v. Raimondo decision—which rescinded Chevron deference—addressed judicial deference to agencies’ interpretations of ambiguous statutory language.

Depending on how lower courts apply the Seven County opinion, NEPA litigation may be curtailed after the dust settles. The opinion emphasized how NEPA challenges have been weaponized to delay projects and have strayed from what Congress intended for NEPA. “NEPA has transformed from a modest procedural requirement into a blunt and haphazard tool employed by project opponents (who may not always be entirely motivated by concern for the environment) to try to stop or at least slow down new infrastructure and construction projects,” wrote Justice Kavanaugh. With SCOTUS limiting judicial review in NEPA cases, opponents may be less likely to challenge project approvals under NEPA for, among other reasons, insufficient scope or alternative analysis unless it is blatant that the agency’s decision falls outside the “broad zone of reasonableness” and thus seems arbitrarily constrained. However, at least in the short term, it seems likely that environmental groups will push back on how far this administration can use the Seven County opinion to minimize and streamline NEPA reviews.

¹ Justice Gorsuch recused himself from the case.