USA – TEXAS Trends and Developments Contributed by: Gerald J. Pels, Gerald D. Higdon, James Beers, Jr., Elizabeth Corey and Brett A. Miller, Troutman Pepper Locke
trends to persist over the coming years. As dur- ing the first Trump administration, the EPA will likely prioritise more traditional, straightforward environmental enforcement cases that can be resolved administratively on a more expedited basis. The industry may, however, face unintended con- sequences from the decreased federal enforce- ment activities. Potential deference to state-led enforcement efforts could lead to a wide range of disparate results throughout the country, and require extensive planning by the industry to address a potentially increasing number of dif- fering state programmes to fill perceived gaps associated with federal deregulation efforts. Companies in business-friendly states may have opportunities for more favourable settlements, while operators in other states should expect increased state-level enforcement pressures as state agencies seek to counter-balance any per- ceived lack of federal enforcement. For exam- ple, the EPA and the New Mexico Environment Department partnered in 2024 to investigate emissions and identify violations at hundreds of oil and gas facilities. This type of partnership will likely not occur regularly during the new admin- istration. Conclusions Regarding Environmental Impacts on the Energy Industry The administration’s emphasis on the impor- tance of the fossil fuel industry for national security reasons should have extensive impacts on the fossil fuel industry, though these impacts may not be immediate. The de-emphasis of renewables may foster investment in fossil fuel development. Thus, heightened development – more energy production, and storage, process- ing and transmission projects – should come online in the relatively short-term. The industry’s environmental professionals and lawyers will
be busy, though many of the EPA’s deregula- tory efforts will likely not be fully implemented in the short-term and will be challenged by certain states and NGOs. Regardless, any deregulation and streamlining of permitting should allow independent pro- ducers to compete more effectively with the larger enterprises. In the past, the complicated labyrinth of rules promulgated by the EPA (and states) imposed a significant and disproportion- ate burden on smaller enterprises. Larger com- panies typically have significant in-house staff- ing available to track and address regulatory changes. Further, the administration’s focus on state efforts to challenge or undermine fossil fuel development should create some pressure for even-handed regulation. Of course, traditional environmental statutes typically allow for state delegation where state programmes are at least as stringent as federal programmes. Challeng- ing state laws and rules as overly burdensome or inconsistent with federal law could well raise issues about the breadth of federal pre-emption as well as regarding a President’s emergency powers. It is easy to envision scenarios where states could impose more stringent regulatory stand- ards or maintain standards that the federal EPA is rolling back. How the administration will han- dle these scenarios is difficult to predict and will likely be litigated. Moreover, even with a regulatory roll-back, the industry should remain prepared for enforce- ment of existing rules. Many rules that present operational and financial challenges will remain on the books. For example, rules requiring vola- tile organic compound (VOC) leak detection and repair, as well as prohibitions on unauthorised emissions, will require constant oversight. Giv-
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