Vt. Dep't of Pub. Serv. v. United States

• Citation: 74 ERC 2123,684 F.3d 149
• Decision Date: 26 June 2012
• Docket Number: Nos. 11–1168,11–1177.,s. 11–1168
• Parties: VERMONT DEPARTMENT OF PUBLIC SERVICE et al., Petitioner v. UNITED STATES of America and Nuclear Regulatory Commission, Respondents Entergy Nuclear Operations, Inc. and Entergy Nuclear Vermont Yankee, LLC, Intervenors.
• Court: United States Courts of Appeals. United States Court of Appeals (District of Columbia)

684 F.3d 149

74 ERC 2123

VERMONT DEPARTMENT OF PUBLIC SERVICE et al., Petitioner

v. UNITED STATES of America and Nuclear Regulatory Commission, RespondentsEntergy Nuclear Operations, Inc. and Entergy Nuclear Vermont Yankee, LLC, Intervenors.

Nos. 11–1168, 11–1177.

United States Court of Appeals, District of Columbia Circuit.

Argued May 9, 2012.

Decided June 26, 2012.

On Petition for Review of a Final Order of the U.S. Nuclear Regulatory Commission.

Elizabeth Miller, pro hac vice, argued the cause for the petitioners. Anthony Z. Roisman, John Beling and Christopher M. Kilian were on brief. Tricia K. Jedele entered an appearance.

Mark D. Davis and Christopher J. Wright were on brief for amici curiae Riverkeeper et al. in support of the petitioners. Timothy J. Simeone entered an appearance.

Eric T. Schneiderman, Attorney General, Office of the Attorney General for the State of New York, and Barbara D. Underwood, Solicitor General, were on brief for amicus curiae State of New York in support of the petitioners. John J. Sipos and Lisa M. Burianek, Assistant Attorneys General, and Monica B. Wagner, Assistant Solicitor General, entered appearances.

Sean D. Croston, Attorney, United States Nuclear Regulatory Commission, argued the cause for the respondents. John E. Arbab, Attorney, United States Department of Justice, Stephen G. Burns, General Counsel, United States Nuclear Regulatory Commission, and John F. Cordes, Jr., Solicitor, were on brief.

Kevin P. Martin argued the cause for intervenors Entergy Nuclear Operations, Inc. et al. David R. Lewis and Elise N. Zoli were on brief.

Adam J. White was on brief for amicus curiae Energy Future Coalition in support of the respondents.

Before: HENDERSON, ROGERS and GARLAND, Circuit Judges.

Opinion for the Court filed by Circuit Judge HENDERSON.

KAREN LeCRAFT HENDERSON, Circuit Judge:

The Vermont Department of Public Service (DPS) and the New England Coalition (NEC) petition for review of a decision of the Nuclear Regulatory Commission (NRC, Commission), issuing to Entergy Nuclear Vermont Yankee, LLC and Entergy Nuclear Operations, Inc. (collectively, Entergy) a renewed license to operate the Vermont Yankee Nuclear Power Station (Vermont Yankee). The petitioners contend the license renewal was unlawful because Entergy failed to furnish a state Water Quality Certification (WQC) which they assert was required under section 401(a)(1) of the Clean Water Act (CWA), 33 U.S.C. § 1341(a)(1). We conclude the petitioners waived their WQC objection because they repeatedly failed to present it directly to the Commission and thereby failed to exhaust their administrative remedies.

I.

The Atomic Energy Act (AEA) authorizes the NRC to issue an initial license to operate a nuclear power plant for a term of up to 40 years. 42 U.S.C. § 2133(a), (c). Pursuant to this authority, the Atomic Energy Commission (AEC), the NRC's predecessor,¹ issued a 40–year license to operate Vermont Yankee on March 21, 1972. Vermont Yankee Nuclear Power Corp.; Notice of Issuance of Facility Operating License, 37 Fed.Reg. 6345 (Mar. 28, 1972). In April 1970, while the licensing proceeding was ongoing, the Congress amended the Federal Water Pollution Control Act, the precursor to the CWA, to add the provisions of the Water Quality Improvement Act, Pub.L. No. 91–224, tit. I, 84 Stat. 91 (1970). Section 21(b) of the Federal Water Pollution Control Act required that any applicant for a federal license or permit to conduct an activity that might “result in any discharge into the navigable waters of the United States ... provide a certification from the State in which the discharge originates or will originate ... that there is reasonable assurance ... that such activity will be conducted in a manner which will not violate applicable water quality standards.” Id. § 102, 84 Stat. at 108. Accordingly, because Vermont Yankee planned to use water from the Connecticut River to cool its reactor and then discharge the water back into the river, Entergy's predecessor licensee obtained a WQC from the State of Vermont in October 1970 to support its operating license application. In October 1972, after Vermont Yankee's initial operating license issued, the Congress enacted the Federal Water Pollution Control Amendments of 1972 (now the CWA), incorporating the section 401 WQC requirement as follows:

Any applicant for a Federal license or permit to conduct any activity including, but not limited to, the construction or operation of facilities, which may result in any discharge into the navigable waters, shall provide the licensing or permitting agency a certification from the State in which the discharge originates or will originate ... that any such discharge will comply with the applicable provisions of [33 U.S.C. §§ 1311, 1312, 1313, 1316, and 1317].... No license or permit shall be granted until the certification required by this section has been obtained or has been waived as provided in the preceding sentence. No license or permit shall be granted if certification has been denied by the State, interstate agency, or the Administrator, as the case may be.

Pub.L. No. 92–500, § 2 (§ 401(a)(1)), 86 Stat. 816, 877–78 (1972) (codified at 33 U.S.C. § 1341(a)(1)); Vermont Yankee's 1970 WQC “continue[d] in full force and effect” thereafter pursuant to the CWA's savings provision. Id. § 4, 86 Stat. at 897.

An operating licensee may also be required to maintain a permit issued under the “National Pollutant Discharge Elimination System” (NPDES) pursuant to CWA section 402. Section 402 authorizes the Environmental Protection Agency (EPA) to “issue a permit for the discharge of any pollutant, or combination of pollutants ... upon condition that such discharge will meet ... all applicable requirements under [42 U.S.C. §§ ] 1311, 1312, 1316, 1317, 1318, and 1343.” 33 U.S.C. § 1342.² Section 402(b) allows a state to obtain EPA approval to administer its own NPDES program, 33 U.S.C. § 1342(b), and in 1974, the State of Vermont did just that. Vermont issued Vermont Yankee a NPDES permit in 1978 and has renewed it successively upon expiration or amendment. Most recently the Vermont Agency of Natural Resources (VANR) renewed it for a five-year term in 2001. See In re Entergy Nuclear Vt. Yankee Discharge Permit, 187 Vt. 142, 989 A.2d 563, 568–69 (2009). ³

On January 25, 2006, Entergy filed an application with the NRC for a 20–year renewal of Vermont Yankee's operating license, which was set to expire on March 21, 2012. Included with the application was an environmental report, as required under 10 C.F.R. § 51.45. In a section titled “Water Quality (401) Certification,” the environmental report stated:

As reported in the [Final Environmental Statement] (1972), the Vermont Water Resources Board provided a water quality certification on October 29, 1970, as amended on November 26, 1971, reflecting its receipt of reasonable assurance that operation of Vermont Yankee will not violate applicable water quality standards. In addition, the current and effective NPDES permit issued by the Vermont Agency of Natural Resources reflects continued compliance with applicable CWA standards. Excerpts of this permit are included in Attachment D.Vermont Yankee Nuclear Power Station, Applicant's Environmental Report, Operating License Renewal Stage § 9.2.1, at 9–1 (Jan. 25, 2006) (Environmental Report). Appended to its application was a table setting out Vermont Yankee's “Environmental Permits and Compliance Status,” which identified a 2001 section 402 NPDES permit issued by VANR, set to expire on March 31, 2006, but made no mention of any section 401 WQC. Id. app. E.

On March 27, 2006, the NRC published a notice announcing it had accepted the Vermont Yankee license renewal application and planned to prepare a site-specific environmental impact statement therefor as a supplement to its Generic Environmental Impact Statement for License Renewal of Nuclear Power Plants (May 1996) (GEIS) pursuant to the National Environmental Policy Act of 1979 (NEPA), 42 U.S.C. §§ 4321 et seq., and the NRC's NEPA regulations, 10 C.F.R. pt. 51.⁴Notice of Acceptance for Docketing of the Application and Notice of Opportunity for Hearing Regarding Renewal of Facility Operating License, 71 Fed.Reg. 15,220, 15,220 (Mar. 27, 2006). The notice declared that “any person whose interest may be affected” by the proceeding and who wished to participate as a party therein should file a “written request for a hearing and a petition for leave to intervene ... in accordance with the Commission's ‘Rules of Practice for Domestic Licensing Proceedings' in 10 C.F.R. Part 2.” Id. at 15,221. The notice further directed that any petition to intervene set forth the petitioner's interest and “the specific contentions which the petitioner/requestor seeks to have litigated at the proceeding” pursuant to 10 C.F.R. § 2.309(a). Id. Four parties, including DPS and NEC, filed timely motions for a hearing or to intervene and an Atomic Safety and Licensing Board (Board) ⁵ was established to preside over the renewal proceeding.

DPS and NEC filed, respectively, three and six contentions challenging Entergy's application, only one of which is relevant here. NEC's “Contention 1” asserted that “Entergy's environmental report (ER) failed to ‘sufficiently assess[ ]’ the environmental impacts of the license renewal, specifically the impacts of increased thermal discharges into the Connecticut River over the 20–year license renewal period.” Entergy Nuclear Vt. Yankee, LLC, 64 N.R.C. 131, 175 (Sept. 22, 2006) (alteration in original). NEC contended in particular:

Entergy's reliance solely on its NPDES permit is not sufficient because the permit is under appeal and, even if issued, will only be valid for 5 years, (2006–2011), and thus will not cover the cumulative impacts of thermal discharges over the 20–year period of the license renewal term (2012–2032).

Id. Entergy answered, inter alia, that once it provided a valid...