On July 27, 2026, EPA issued a news release discussing recent guidance particularly important to power generating facilities supporting data centers. EPA characterized the guidance, issued earlier in July, as, “clarifying that the Clean Air Act (CAA) Acid Rain Program (ARP) does not apply to power generation facilities that are not connected to a public electricity grid.” Facilities not connected to a public electricity grid are known as “islanded” power generating facilities

While applicable generally to “islanded” power generating facilities, the news release acknowledges that providing power for new data centers will be a major application of the guidance.

ARP Not Applicable to Islanded Facilities
The news release provides this summary of the guidance: “EPA’s guidance clarifies that under the best reading of the CAA, the ARP applies to facilities that sell electricity or are required to report as a generating unit to the U.S. Department of Energy (DOE). Because “islanded” power generation facilities neither sell electricity nor have required reporting to DOE, EPA has concluded that these facilities are not subject to the ARP. If a company develops a power generation facility that is not grid connected, but at a future date the company does connect the facility to the grid, the facility may be subject to the provisions in the ARP.”

University of Houston Law Center professor Tracy Hester has written an excellent article on “islanded” power generating facilities supporting data centers in Texas https://law.uh.edu/eenrcenter/perspectives/Data-in-the-Air.asp

To see the news release, which has a link to the guidance document https://www.epa.gov/newsreleases/epa-issues-permitting-guidance-further-president-trumps-agenda-promoting-data-centers