Wednesday, May 4, 2011

Alcoa Power Generating Inc. v. FERC

May 3: In the U.S. Court of Appeals, D.C. Circuit, Case No. 10-1066. On Petition for Review of Orders of the Federal Energy Regulatory Commission (FERC). The Alcoa Power Generating Company petitions for review of two orders of FERC with respect to the relicensing of its Yadkin Project facilities in North Carolina. A precondition of licensing is receipt of a State certification that any discharges into navigable waters will comply with sections 301-03 and 306-07 of the Clean Water Act. Section 401(a)(1) of the Clean Water Act provides that State certification 'shall be waived with respect to such Federal application' if the State certifying agency 'fails or refuses to act on a request for certification, within a reasonable period of time (which shall not exceed one year) after receipt of such request . . ..'
    When a State administrative law judge stayed pending appeal the water certification issued by the State agency, Alcoa Power petitioned the Commission for a declaratory order that the certifying agency had waived its authority by not issuing a certification that was effective and complete within one year. The Commission denied the petition, ruling there was no waiver because the State had 'act[ed] on' Alcoa Power's application within one year of its filing. Alcoa Power contends that the Commission misinterpreted the law and the facts and that the State violated the time limit in Section 401(a)(1) by linking the effectiveness of the certification to satisfaction of a bond requirement after the expiration of the one-year period, thereby waiving its right to issue a certification for the project. The Commission maintains that the petition for review is not ripe because, in accordance with its policy, it has not been able to act on Alcoa Power's application for licensure in view of on-going State administrative review and stay of the certification.
    The Appeals Court said, "We hold that the petition is ripe, because if the certification was waived, then the pendency of the State proceeding is no bar to the Commission acting on Alcoa Power's licensing application. We agree with the Commission's interpretation of Section 401 in ruling that there was no waiver by the State and, therefore, we deny the petition for review." The Appeals Court explains, "In sum, under Section 401, the State, acting through its Division of Water Quality, timely issued a water quality certification that complied with the requirements of Section 401. The Commission on rehearing made clear that it was free to commence its licensing proceeding but for its policy to stay such proceedings pending conclusion of the State proceeding, which policy Alcoa Power does not challenge. Because the "effective" clause in the bond condition of the 2009 Certification did not operate to block or delay the federal licensing proceeding, and it did not contravene Section 401(a)(1)'s waiver provision, much less the Commission's regulations, Alcoa Power's objections to the substantive content of the 2009 Certification is a matter of State law that is properly raised in the State proceeding, as Alcoa Power has done.
    "Alcoa Power's additional objection that the Commission failed to engage in reasoned decision-making by ignoring or misapprehending certain material facts fails. The allegedly ignored facts are that (i) the bond condition as written in the 2009 Certification is objectively impossible to satisfy, and (ii) the Division of Water Quality had ample time to request satisfaction of the bond condition within the one-year statutory period in view of the extended procedural history of Alcoa Power's requests for certification. These assertions became irrelevant to the Commission's waiver analysis once it concluded that neither Section 401 nor its own regulation required it to wait until the bond condition was satisfied before proceeding with Alcoa Power's license application. The Commission therefore had no reason to analyze these issues in greater depth."
    Access the complete opinion (click here). [Energy, Water]

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