Orbital Data Centers Could Put National Environmental Policy Act to the Test in Space

Proposals to put more than one million data-center satellites into low-Earth orbit could force the Federal Communications Commission to answer a novel environmental-law question: What happens when infrastructure licensed in the United States operates in outer space but may produce environmental effects closer to home?

In July 2026, a coalition of environmental and scientific organizations represented by nonprofit Earthjustice petitioned the Federal Communications Commission (FCC) to pause consideration of orbital data-center applications and conduct a programmatic environmental review under the National Environmental Policy Act (NEPA). The petition focuses on the potential cumulative effects from launches, satellite reentries, orbital debris, light pollution, and impacts on astronomy.

The petition arrives at the same time that the FCC is reconsidering its own approach to environmental reviews. In 2025, the FCC proposed excluding space-based operations from NEPA on the grounds that they are extraterritorial activities the effects of which occur entirely outside US jurisdiction, while also seeking comment on whether some space operations or their effects occur within US jurisdiction. The new orbital data-center proposals underscore the need to determine that issue.

Although the question of whether "NEPA applies in space" sounds simple, the analysis could be complex. Challenges to the FCC's treatment of orbital data centers are likely to turn on three related issues: whether an FCC satellite license requires environmental review in the first place; whether NEPA can apply to a federal decision authorizing activity in outer space; and, if it does, which environmental effects are sufficiently connected to the FCC's licensing decision to require consideration.

THE FCC'S EXISTING NEPA FRAMEWORK MEETS MILLION SATELLITE SCALE

NEPA generally requires federal agencies to assess the environmental consequences of major federal actions, but the FCC has historically treated satellite licensing as categorically excluded from environmental review absent circumstances warranting additional consideration. Environmental groups have unsuccessfully sought additional review of large satellite constellations based on launch and reentry emissions, satellite reflectivity, orbital debris, and collision risks.

Orbital data centers raise the stakes principally because of their scale. The applications now before the FCC contemplate well over a million satellites—a class of infrastructure at a potentially unprecedented scale.

That scale underlies the July 2026 petition's request for a programmatic review rather than consideration of environmental effects application by application. The petition argues, in substance, that the FCC cannot adequately assess the environmental consequences of this emerging industry by viewing each proposed constellation in isolation.

The FCC's pending rulemaking points in the opposite direction. The FCC has proposed treating space-based operations as outside NEPA’s authority (i.e., because the activities and their effects occur outside US jurisdiction)—a proposal that could streamline environmental review as the commercial space industry expands. The July petition thus puts pressure on an aspect of the FCC's proposal: whether the effects of space-based operations can properly be characterized as occurring entirely outside US jurisdiction.

FROM ANTARCTICA TO OUTER SPACE

If NEPA applies to an FCC licensing decision, will the location of the licensed activity matter?

Activity in the jurisdiction of another sovereign nation is generally excluded from review. However, some precedent supports applying NEPA to federal decisions involving activity beyond US territory. Most notably, in Environmental Defense Fund Inc. v. Massey, the US Court of Appeals for the District of Columbia Circuit held that NEPA applied to the National Science Foundation's decision to incinerate food waste at a US research station in Antarctica.

In that case, the Massey court reasoned that NEPA regulates federal agency decision-making and that the relevant agency decision occurred in the United States. The court also considered significant the absence of another nation's recognized sovereignty over Antarctica, which reduced the concern that applying US law would interfere with the laws of another sovereign country.

Similarly, the longstanding Outer Space Treaty provides that outer space is not subject to national appropriation by claims of sovereignty. And Massey itself discusses "the high seas, outer space, and Antarctica" as areas beyond the jurisdiction of individual states.

Environmental challengers therefore might argue that Massey supports NEPA review of an FCC licensing decision even though the licensed infrastructure would operate in orbit. On that view, the relevant federal conduct is the FCC's licensing decision in the US, while the absence of foreign sovereignty over outer space weakens the objection to applying US environmental law.

However, Massey does not resolve the issue, and subsequent extraterritoriality decisions have cautioned against treating the absence of a competing sovereign as sufficient, by itself, to overcome the presumption against applying US statutes abroad.

A court addressing a challenge to the FCC’s decision therefore could confront an unusual combination: a federal licensing decision made within the United States, commercial activity occurring in space, and alleged environmental consequences occurring both in space and on Earth.

AFTER SEVEN COUNTY, WHICH EFFECTS BELONG TO THE PROJECT?

Even if NEPA applies to the licensing decision, that would not mean that every environmental consequence associated with an orbital data center must be analyzed by the FCC.

The US Supreme Court's 2025 decision in Seven County Infrastructure Coalition v. Eagle County is likely to be central to that question. The Court emphasized that NEPA requires agencies to consider the environmental effects of the project under review, not to undertake an open-ended analysis of effects attributable to separate upstream or downstream projects. The Court also emphasized substantial judicial deference to agencies in determining the scope and detail of environmental review—courts should not micromanage agency review.

Seven County did not limit NEPA analysis to effects occurring at the physical location of a project. Environmental effects of the project itself can remain relevant even if they occur later or at some geographic distance.

That distinction could matter considerably for orbital data centers. The Supreme Court gave examples of runoff traveling downstream and emissions traveling downwind to illustrate effects of a project that remain relevant despite occurring elsewhere. Environmental challengers might analogize atmospheric effects from satellite reentry to those examples: the alleged effect occurs far from the satellite's operating location, but arguably results from the licensed system itself.

Other alleged effects may be harder to attribute to the FCC-authorized project. Commercial launches and reentries are subject to separate FAA licensing authority, potentially complicating efforts to attribute their environmental effects to the FCC-authorized project. Under Seven County, the division of regulatory authority could matter as much as the geographic location of the alleged effect.

A dispute in court may therefore turn less on the abstract question of whether NEPA "reaches space" than on how courts characterize the federal action and the environmental effects attributable to it.

In the meantime, stakes extend beyond orbital computing. If the FCC requires additional NEPA review for very large orbital systems, applicants could face new questions concerning licensing strategy, application timing, environmental records, and the allocation of review among agencies responsible for different stages of a space system's lifecycle. Those questions could extend to large communications constellations, in-space manufacturing, satellite servicing, and other emerging commercial uses of orbit.

The resulting litigation may not ultimately turn on whether NEPA "applies in space." The more consequential questions may be which federal decisions trigger review—and whether environmental effects that originate with infrastructure in orbit remain effects of the licensed project when they reach the atmosphere or Earth.