Trump Administration's Regulatory Sunset Executive Order Finds Similarities in Long-Standing Texas Act
In Short
The Situation: President Trump issued Executive Order ("EO") 14270 to reform the regulatory framework governing energy production through sunset provisions on all existing and future energy regulation.
The Result: EO 14270 mandates that specified federal agencies add "Conditional Sunset Dates" to existing and new energy-related regulations, causing the regulations to automatically lapse unless actively reviewed and extended. Agencies must implement this sunset process by September 30, 2025, with public input required before any extensions are granted.
Looking Ahead: Agencies will need to periodically review regulations to determine their continued necessity. Affected industries should follow these reviews to ensure continued compliance.
Background
On April 9, 2025, President Trump issued EO 14270 aimed at reforming the regulatory framework for energy production titled "Zero-Based Regulatory Budgeting to Unleash American Energy." EO 14270 requires certain agencies tasked with energy regulation to issue a sunset rule that inserts a Conditional Sunset Date in regulations stemming from enumerated statutes. It also requires any new regulations stemming from those statutes to possess a Conditional Sunset Date. The stated purpose of EO 14270 is to ensure regulations are periodically reexamined and continue to serve the public good while not imposing unnecessary burdens on energy production.
Key Provisions
The EO applies to the Environmental Protection Agency, Department of Energy, Federal Energy Regulatory Commission, and Nuclear Regulatory Commission, as well as the following agency subcomponents: the Office of Surface Mining Reclamation and Enforcement, the Bureau of Land Management, the Bureau of Ocean Energy Management, the Bureau of Safety and Environmental Enforcement, the United States Fish and Wildlife Service, and the United States Army Corps of Engineers.
Existing Regulations. Each agency must issue a sunset rule to be effective no later than September 30, 2025. The rule will put a one-year Conditional Sunset Date on each of the existing covered regulations unless the date is extended. Agencies must offer the public an opportunity to comment on the costs and benefits of each regulation, and the agency may extend the Conditional Sunset Date if it finds the extension warranted. The agency may extend the date as many times as it deems appropriate, but each extension cannot be longer than five years. On the sunset date, agencies will treat the regulations as no longer effective for all purposes.
New Regulations. Agencies are likewise required to include sunset dates on any new regulations stemming from the covered statutes. The sunset dates may not be more than five years in the future. The Office of Management and Budget may exempt a new regulation from the requirements if it has a "net deregulatory effect."
The EO includes an exemption for "regulatory permitting regimes authorized by statute," and it directs agency heads to coordinate with their "DOGE Team Leads" for implementation.
Comparison to Texas's Sunset Advisory Commission
For the last 50 years, Texas has taken a similar approach to regulation management through the Texas Sunset Act. Like EO 14270, the Texas Legislature inserts sunset dates; however, Texas's sunset dates are inserted into the founding statute of each applicable agency, instead of individual regulations. This means that the agency and all of its regulations are abolished unless Texas's Legislature decides to renew its charge.
The Texas Sunset Act is implemented by the Sunset Advisory Commission ("SAC"). The SAC evaluates the performance and necessity of state agencies every 12 years. For example, the Texas Commission on Environmental Quality will be reviewed in the 2034–35 cycle, while the Texas Railroad Commission will face review in the 2028–29 cycle. The SAC uses general criteria established by the Texas Sunset Act, such as the efficiency, effectiveness, fairness, and accountability of the agency under review, to publish a staff report with its findings and recommendations, which may include continuing, restructuring, or abolishing the agency. The SAC votes on its final recommendations, which are then submitted to the Texas Legislature. In each of these steps, public input is sought. The Texas Legislature may pass legislation to implement the SAC's recommendations, or, if the Texas Legislature fails to act, the agency is automatically abolished upon the sunset date.
While EO 14270 does not establish an equivalent to the SAC, DOGE coordination may fill a similar role. It would not be the first time the two departments were compared. In March 2025, Texas Republicans proposed a bill that would rename the SAC the Department of Government Efficiency.
There are some key differences, but the Texas Sunset Act provides potential insights as to how EO 14270 will affect the regulatory landscape. Regulated industries should follow the rulemaking process carefully to ensure continued compliance with regulations.
Four Key Takeaways
- Agencies must issue a sunset rule to be effective no later than September 30, 2025, to create a Conditional Sunset Date one year from the effective date of the rule for all covered regulations.
- New regulations must also have Conditional Sunset Dates of not more than five years in the future.
- The Conditional Sunset Date may be extended as many times as appropriate after public comments about the costs and benefits of the regulation, but each extension cannot be for more than five years.
- EO 14270's new sunset process has similarities to Texas's long-standing sunset advisory process, which may provide insights into the effect of EO 14270.
