The Interior Department and the Commerce Department finalized a rule on Friday, July 10, that narrows one of the most consequential words in American environmental law, clearing habitat that had been off-limits for half a century for use by energy producers, farmers, fishing operations, miners and developers. Interior Secretary Doug Burgum said the action restores common sense and gives landowners certainty, framing a change that turns on the single word “harm” in the Endangered Species Act.

For more than four decades, federal regulators treated “harm” to a protected species as including significant destruction or degradation of the habitat it needs to feed, shelter and breed. The U.S. Supreme Court upheld that reading in 1995. The new rule scraps it. Going forward, a project can impair the place where a threatened or endangered species lives without running afoul of the law, so long as the activity does not directly injure or kill the animal itself.

The Commerce Department’s role is easy to overlook and central to the business impact. Commerce oversees NOAA Fisheries, the agency responsible for salmon, sturgeon, whales and other marine and migratory species, while the Fish and Wildlife Service inside Interior handles land animals. That split means the rewrite reaches straight into the ocean economy: commercial fishing fleets, aquaculture operators, offshore wind and offshore oil and gas developers, and port and coastal construction projects have all bumped up against habitat-based restrictions tied to listed marine species. In their joint announcement, Interior and Commerce said the rule reduces permitting and compliance costs for energy producers, farms and fishing interests, and returns the statute to what they called its single best meaning rather than a politically stretched one.

That is the crux of the commercial story. The Endangered Species Act is one of the biggest regulatory chokepoints in federal permitting. Any agency weighing a permit for oil and gas, mining, logging, electric transmission or coastal development has to evaluate the effect on listed species, and habitat considerations routinely add years and cost to a project’s timeline. By pulling habitat modification out of the definition of harm, the administration is betting it can accelerate approvals across exactly the sectors it has prioritized. The move aligns with President Donald Trump’s broader push to strip regulations he argues constrain American business.

The legal scaffolding matters for how durable the change proves to be. In their news release, Interior and Commerce leaned on Loper Bright v. Raimondo, the 2024 Supreme Court decision that overturned the long-standing Chevron doctrine, which had directed judges to defer to an agency’s reading of an ambiguous statute. With Chevron gone, courts now interpret statutory text themselves, and the administration is arguing that the plain text of the Act never required the broader habitat definition in the first place. The rule was first proposed in April of last year and, as of Friday afternoon, had not yet appeared in the Federal Register, the step that starts the clock on its legal effect.

Opponents are already moving. The Center for Biological Diversity called the decision a death knell for American wildlife, with senior campaigner Tara Zuardo arguing that habitat destruction is the leading threat to imperiled species and that removing it from the definition of harm guts the law’s purpose. Lawyers at Earthjustice and other conservation groups have signaled litigation, meaning the rule’s real-world staying power will be tested in court before businesses can fully count on it. Environmental groups note the Act is credited with pulling the bald eagle, the California condor and other species back from extinction, and warn that spotted owls, Atlantic salmon and Florida panthers are among those now exposed.

For companies weighing capital decisions, the practical takeaway is mixed. The rule opens a wider lane for extractive and development projects and could shorten permitting timelines, a genuine cost saving in industries where delay is the single largest risk. But the coming legal fight introduces its own uncertainty. A developer who breaks ground relying on the new interpretation could face exposure if a court reinstates the old one, and lenders and insurers tend to price that ambiguity in. The safest near-term posture for regulated businesses is to treat the change as directional rather than settled, and to watch the Federal Register filing and the first court challenges closely.

What is not in dispute is the direction of travel. The administration has signaled the harm rule is one piece of a broader slate of environmental rollbacks aimed at speeding approvals, and Commerce and Interior have now shown they are willing to reach deep into decades-old regulatory language to get there.

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