Agency Highlights

United States Environmental Protection Agency (“EPA”)

EPA Initiative to Study and Measure Microplastics. The EPA announced its intent to study and measure the presence of microplastics and pharmaceuticals in drinking water. This marks the first step for the agency to potentially regulate the presence of microplastics and pharmaceuticals as drinking water contaminants and measure the contaminants’ impacts to human health. The study will evaluate the presence of these contaminants in drinking water and the human body, and whether such presence is indicative of negative health outcomes.

The EPA’s sixth Contaminant Candidate List identifies contaminants in drinking water not regulated under the Safe Drinking Water Act, including microplastics, pharmaceuticals, disinfection byproducts, PFAS “forever chemicals,” and microbes. The list is currently open for a 60-day public comment period.

EPA Repeals Endangerment Finding for Greenhouse Gases. In February 2026, the EPA revoked its 2009 endangerment finding, which found that greenhouse gas emissions, including carbon dioxide, threaten public health and welfare. The endangerment finding historically provided the basis for many recent regulations under the Clean Air Act. Most notably, this change eliminates all greenhouse gas emissions standards for cars and trucks. While this may positively impact the solid waste industry by potentially lowering costs of heavy-duty trucks and equipment, effects to the industry are generally anticipated to be nominal. This is in part due to the fact that programs such as New Source Performance Standards set threshold triggers based on non-methane organic compounds rather than greenhouse gas emissions.

After finalizing this rule, several lawsuits challenging it were quickly filed. Specifically, two dozen states, several cities and counties, and a broad coalition of public health and environmental groups filed suit. The suits claim that the rescission of endangerment abandons one of the EPA’s core responsibilities to protect public health. The suits also claim that since the endangerment finding in 2009, the evidence for greenhouse gas emissions being a danger to public health and safety has only grown. See Massachusetts v. EPA, No. 26-1061 (D.C. Cir. filed Mar. 19, 2026); see also Env’t Def. Fund v. EPA, No. 26-1038 (D.C. Cir. filed Feb. 18, 2026).

National Environmental Policy Act (“NEPA”)

Changes to NEPA Review at All Federal Agencies. In January 2026, the White House Council on Environmental Quality (“CEQ”) finalized its interim final rule which formally rescinded the CEQ’s authority to require federal agencies follow its NEPA regulations. Moving forward, each federal agency will be tasked with formulating their own NEPA regulations and implementation procedures. Many agencies, like the Department of Energy and Department of Agriculture, have published interim final rules amending their own NEPA rules. For example, the Department of Interior (“DOI”) recently published its final rule overhauling how the agency implements NEPA, rescinding approximately 80% of the DOI’s prior regulations and implementing procedures designed to shorten permitting timelines and reduce unnecessary paperwork. To be clear, NEPA still applies to federal agencies and is still federal law. Federal agencies must still analyze the environmental impacts of proposed federal projects, consider alternatives, and document their decision-making. However, as more agencies finalize their rules in light of the CEQ’s January 2026 rule, there will be slight differences in how NEPA reviews are interpreted and implemented at each agency, something the regulated community will need to keep a close eye on.

United States Department of War (“DoW”)

DOW Provides Revised Recommendations on Destruction and Disposal of PFAS. In February 2026, the DOW, as a large consumer of PFAS materials (particularly Aqueous Film-Forming Foam (“AFFF”) to fight fuel fires), published an analysis revising EPA’s guidance on the destruction and disposal of certain PFAS materials. The DOW previously prohibited incineration due to concerns that incineration might not fully destroy the PFAS contaminants and potentially spread them through the air via the smoke by-product. The DOW has now revised its guidance to allow for incineration at permitted hazardous waste facilities if certain temperature and environmental requirements are met. The DOW also now discourages disposal in municipal solid waste landfills for AFFF concentrate and liquids (but solid materials may be disposed of in this method if the landfill meets certain requirements). Cost was not considered as a factor for these recommendations.

United States Department of Agriculture and United States Department of State

U.S. & Mexico Water Deliveries. On January 31st, the USDA and the U.S. Department of State came to an agreement with Mexico to strengthen the 1944 Water Treaty between the United States and Mexico. This new commitment states that Mexico will provide more frequent and predictable releases of water for South Texas farmers and ranchers. Mexico will deliver a minimum of 350,000 acre-feet of water per year to the United States as well as repaying outstanding water debt and establishing early delivery incentives. Monthly meetings will ensure consistent deliveries and hopefully prevent future deficits. The USDA also committed to technical and financial support to modernize irrigation infrastructure throughout the Chihuahua region of Mexico to ensure greater water conservation.

The Attorney General of Texas (“AG”)

Texas Attorney General Lawsuit against DOW Chemical. The AG’s Office filed a lawsuit against Dow Chemical Company, Dow Chemical’s subsidiary Union Carbide, and the Brazilian petrochemical manufacturer Braskem, alleging violations of the Texas Water Code and the Texas Solid Waste Disposal Act at Dow Chemical’s manufacturing complex in Seadrift, Texas. The complaint stems from the alleged unauthorized production and discharge of industrial solid waste (plastic pellets) into the nearby waterbodies and the alleged failure to follow best management practices. The AG is seeking civil penalties as well as temporary and injunctive relief to cease all unauthorized discharges. The litigation was triggered by the issuance of a 60-day citizen suit notice issued by a local resident, as authorized by the Clean Water Act.

Public Utility Commission of Texas (“PUC”)

PUC to Study Data Center Water Usage. During the PUC’s Commissioners meeting on February 6th, the Commission approved a new initiative to study water usage by data centers and crypto-mining facilities. The plan includes issuing a survey to data center developers and cryptocurrency mining operators which will require disclosure of their water consumption, including both direct and indirect water use. This survey will launch in the spring of 2026 and selected facilities will have 6 weeks to respond. The PUC is actively working with the Texas Water Development Board to develop the survey questions that can ultimately inform state-wide planning. Questions will focus on direct water use by the facilities for cooling activities, and indirect water use related to the facilities’ power sources. The PUC anticipates to release the results of its survey to the Texas Water Development Board and the Texas Commission on Environmental Quality at the end of the year before the 2027 Legislative Session begins.

Oncor Rate Case Settlement Agreement. As previously reported, in June 2025, Oncor Electric Delivery Company LLC (“Oncor” or “Company”) filed an application with the PUC seeking to increase its transmission and distribution rates by $834 million. As filed, the application would have resulted in a $7.90/month increase on the average residential customer bill. In November 2025, parties to the pending rate case notified the Administrative Law Judge of a settlement in principle.

On January 29, 2026, Oncor filed an unopposed Settlement Agreement (“Agreement”) for PUC consideration and approval. The Agreement establishes an annual revenue requirement of nearly $7 billion. This represents an 8.8% increase over present adjusted revenues, or $565 million in annualized revenue. For residential customers, this will result in an increase of $4.64/month on the average electric bill.

The Agreement proposes a revised regulatory capital structure of 56.5% debt to 43.5% equity. Further, the Agreement proposes an authorized return of equity increase from 9.7% to 9.75%, while the authorized cost of debt will decrease from 4.94% to 4.39%. The Agreement includes a higher annual storm and self-insurance reserve in rates of $200 million and a five-year amortization for certain regulatory assets and liabilities.

As of March 18, 2026, a Proposed Order has been filed for PUC consideration. After the PUC issues the Final Order, the new rates will go into effect with a temporary adjustment in costs, or a surcharge, from January 1, 2026, to when the new rates begin. More information can be found under Docket No. 58306.

Ongoing Texas-New Mexico Power Company (TNMP”) Rate Case. In In November 2025, TNMP filed an Application for Authority to Change Rates. TNMP requested a net increase in transmission and distribution rates of approximately $34 million over adjusted test-year revenues, or an approximately 5% increase over the adjusted test-year revenues of $673 million. If TNMP’s original request is approved unchanged, residential customers would see a monthly increase of $5.20 to their average electric bill.

On March 6, 2026, Parties filed an Agreed Motion to Abate as the parties continue their efforts to reach a full resolution. The ALJ approved the Motion to Abate and required a status report from the parties every two weeks until the parties reach a resolution. As of April 20, 2026, the parties continue to confer regarding settlement in this proceeding. More information can be found under Docket No. 58964.

Texas-New Mexico Power Company and Troy Parentco, LLC Merger Approved. As previously reported, TNMP and Troy Parentco, LLC filed for PUC merger approval and the parties were waiting for PUC consideration. On February 6, 2026, the Commission approved the merger, and a Final Order was filed approving the Settlement Agreement. TXNM, Energy, Inc. (TNMP’s parent company) is now a wholly owned subsidiary and TNMP an indirect subsidiary of Troy and Blackstone Infrastructure.

The Settlement Agreement outlines governance protections and financial safeguards, ensures local control and workplace protections, and provides customer and regulatory protections. Key Settlement Agreement terms include: TNMP’s agreement to provide a $45.5 million rate credit to wholesale and retail customers, distributed over 48 months; composition of a seven-member TNMP Board of Directors with three disinterested directors and representation from TNMP leaders; Board authority over key matters, such as the dividend policy and officer appointment; terms prohibiting acquisition-related debt and intercompany financial arrangements; limits on dividend payments, which will be subject to credit ratings and financial health requirements; TNMP’s agreement that headquarters will remain in its Texas service territory with day-to-day operations continuing under TNMP’s management team; agreement to refrain from involuntary workforce reduction or cuts to wages and benefits for at least three years, except for cause; terms that bar recovery of transaction-related goodwill or acquisition costs in customer rates; and TNMP’s agreement to maintain its current five-year capital spending plan through 2029.

The full Final Order and other materials can be found in Docket No. 58536.

PUC Rulemaking. In January 2026, PUC Staff updated its calendar to reflect projected rulemaking timelines for the 2026 year. The calendar is a robust list of projects covering changes to the PUC’s electric and water rules. The 2026 calendar can be found on the PUC’s Interchange under Docket No. 59212.

As of April 28, 2026, the following calendar rulemakings are in progress:

• Project No. 58481 – Rulemaking to Implement Large Load Interconnection Standards Under PURA 37.0561
• Project No. 58479 – Rulemaking for Net Metering Arrangements Involving a Large Load Co-Located with an Existing Generation Resource under PURA 39.169
• Project No. 58482 – Rulemaking to Develop Reliability Service to Competitively Procure Demand Reductions from Large Load under PURA 39.170
• Project No. 57883 – Commission Directives to ERCOT
• Project No. 59024 – Texas Energy Fund – Texas Backup Power Package Program
• Project No. 59432 – Transmission and Distribution Pole Structural Integrity and Service Quality Standards
• Project No. 59431 – Distribution Pole Management and Inspection Plans
• Project No. 59086 – Implementation of HB 2712 (89R) – Future and Combined Test Years (Water and Sewer)
• Project No. 58391 – Implementation of SB 740 (89R) – System Improvement Charge

The following rulemakings since the publication of the 2026 rulemaking calendar have been completed and new rules are in effect:

• Project No. 58480 – Rulemaking to Establish Large Load Criteria Forecasting Criteria PURA 37.0561
• Project No. 58434 – Rulemaking for Firm Fuel Supply
• Project No. 58400 – CY2025 Updates to Chapter 22 – Procedural Rules, Subchapters A-F
• Project No. 58401 – CY2025 Updates to Chapter 22 – Procedural Rules, Subchapters G-J
• Project No. 58402 – CY2025 Updates to Chapter 22 – Procedural Rules, Subchapters K-O
• Project No. 58392 – Implementation of SB 231 (89R) – Temporary Emergency Electric Energy Facilities

“Agency Highlights” is prepared by Jake Steen an Associate in the Firm’s Districts, Water, and Litigation Practice Groups; Mattie Neira an Associate in the Firm’s Air and Waste Practice Group; and Ace Dantzler-Woodruff a to-be-licensed Associate in the Firm’s Energy and Utility Practice Group; and Roslyn Warner in the Firm’s Energy and Utility Practice Group. If you would like additional information or have questions related to these agencies or other matters, please contact Jake at 512.322.5811 or jsteen@lglawfirm.com, or Mattie at 512.322.5804 or mneira@lglawfirm.com, or Ace at 512.322.5885 or adantzler-woodruff@lglawfirm.com, or Roslyn at 512.322.5802 or rwarner@lglawfirm.com.