Alcoa Power Generating Inc. v. Fed. Energy Regulatory Comm'n
| Citation | 72 ERC 1865,395 U.S.App.D.C. 425,643 F.3d 963 |
| Decision Date | 03 May 2011 |
| Docket Number | No. 10–1066.,10–1066. |
| Parties | ALCOA POWER GENERATING INC., Petitionerv.FEDERAL ENERGY REGULATORY COMMISSION, RespondentStanly County, North Carolina and State of North Carolina, Intervenors. |
| Court | United States Courts of Appeals. United States Court of Appeals (District of Columbia) |
OPINION TEXT STARTS HERE
On Petition for Review of Orders of the Federal Energy Regulatory Commission.David R. Poe argued the cause and filed the briefs for petitioner.Jennifer S. Amerkhail, Attorney, Federal Energy Regulatory Commission, argued the cause for respondent. With her on the brief were Thomas R. Sheets, General Counsel, and Robert H. Solomon, Solicitor.Marc D. Bernstein, Special Deputy Attorney General, North Carolina Department of Justice, argued the cause for intervenor State of North Carolina in support of respondent. With him on the brief were Roy Cooper, Attorney General, James C. Gulick, Senior Deputy Attorney General, and Donald W. Laton, Assistant Attorney General.Before: ROGERS and TATEL, Circuit Judges, and WILLIAMS, Senior Circuit Judge.Opinion for the Court by Circuit Judge ROGERS.ROGERS, Circuit Judge:
The Alcoa Power Generating Company petitions for review of two orders of the Federal Energy Regulatory Commission with respect to the relicensing of its Yadkin Project facilities in North Carolina pursuant to 16 U.S.C. § 808. 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, 33 U.S.C. §§ 1311–13, 1316–17. 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....” 33 U.S.C. § 1341(a)(1). 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. See Alcoa Power Generating Inc., 129 FERC ¶ 61,028 (2009) (“ Order ”); Alcoa Power Generating Inc., 130 FERC ¶ 61,037 (2010) (“ Rehearing Order ”).
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. 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. See Rehearing Order ¶ 15. 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.
As the expiration of the Yadkin Project's 50–year license approached, Alcoa Power filed an application for a license renewal with the Commission in April 2006. As the hydroelectric project indisputably falls within the scope of Section 401(a)(1) as one that “may result in any discharge into the navigable waters,” it requested a Section 401 certification from the North Carolina Department of Environment and Natural Resources on May 10, 2007. The Department's Division of Water Quality issued the water quality certification on November 16, 2007, and Alcoa Power filed it with the Commission on November 30, 2007. Before the Commission proceeded with licensing, the Division of Water Quality informed Alcoa Power on April 16, 2008 that its previous certification proceeding had failed to provide an adequate opportunity for public comment (as apparently required under State law). Accordingly, the Division of Water Quality revoked the original water quality certification and told Alcoa Power to re-apply.
Alcoa Power complied shortly thereafter, on May 8, 2008, withdrawing and re-filing its previous request. A public hearing was held on January 15, 2009, and the hearing officer submitted a report with findings on May 6, 2009. The Division of Water Quality issued a new certification on May 7, 2009, the last day of the one-year period. This new certification (the “2009 Certification”) contained a number of terms and conditions, including a requirement that Alcoa Power undertake various improvement, control, and monitoring measures related to water quality. Importantly, the 2009 Certification also required Alcoa Power or its parent company, Alcoa Inc., to post a surety bond in the amount of $240 million “to cover all water quality improvement costs” related to the Yadkin Project “within ninety days of receipt of the Certification” and to remain posted until a dissolved oxygen water quality standard was met for three consecutive years. The condition further stated that “[t]his Certification is only effective once the required performance/surety bond is in place.”
Alcoa Power submitted the 2009 Certification to the Commission the next day, May 8, 2009. Then, on May 27, 2009, a North Carolina administrative law judge issued a preliminary injunction staying the 2009 Certification pursuant to a motion filed by Stanly County, North Carolina, arguing that the Division of Water Quality violated State law by declining to consider certain water quality impacts of the Yadkin Project. Alcoa Power challenged the 2009 Certification in the same State administrative proceeding on the ground that the bond condition was excessive and impossible to comply with, and that the effectiveness clause in the bond condition violated the time limits for action under State law and Section 401 of the Clean Water Act.
Alcoa Power filed a petition for a declaratory order with the Commission on September 17, 2009. It argued that North Carolina had waived its Section 401 authority by failing to act on the request for certification within one year because the effectiveness clause of the bond condition rendered the “purported certificate ... incomplete.” Pet. for Declaratory Order 1. Issuing a conditional certification on the last day of the statutory deadline, Alcoa Power continued, “ensured that the required bond could not be posted (and, thus, that its certification could not become ‘effective’) prior to the expiration of the statutory deadline.” Id. at 4. The Commission ruled that the issued certification was the “act” required by Section 401 irrespective of whether further action was required of Alcoa Power under certification conditions because the State's action was complete upon its issuance of the certification. Order ¶ 8.
In seeking rehearing, Alcoa Power argued that the Commission's order was factually and legally unsupported, and also that the bond condition not only could not be satisfied within the one-year period, but that it could never be satisfied as written, and that even if a certification that is not effective within one year is valid under Section 401, one that can never be effective is not. It attached the affidavit of a bond agent, Charles R. Croyle, who described the terms of the bond condition as “nebulous” and stated that “it would be extremely difficult, if not impossible, to place a bond with those requirements and of that magnitude in the marketplace.” Croyle Aff. ¶¶ 5–6, Nov. 13, 2009. Stanly County, the Department of Environmental and Natural Resources, and the State of North Carolina intervened and opposed the request for rehearing.
The Commission denied rehearing, concluding that Section 401's one-year period for a State to “act” does not foreclose a certification that requires action beyond the one-year period as long as the certification itself issues before the one-year anniversary of the request. Rehearing Order ¶ 14. The “controlling point,” the Commission explained, was that “no additional decision will be required from the [State] Division on the certification request itself.” Id. With regard to the clause stating that the certification was not “effective” until satisfaction of the bond condition, the Commission ruled that this would not delay its licensing proceeding because Section 401 permits it to proceed once the certification “has been obtained,” 33 U.S.C. § 1341(a)(1), regardless of whether it has become “effective.” Rehearing Order ¶ 15. The Commission concluded that it “would be free to issue a license, regardless of whether the certification provided that it was not yet effective,” and accordingly, there was no waiver issue. Id. The Commission interpreted its regulations to mean that a Section 401 waiver occurs where a State “has not denied or granted certification” by the one-year date. 18 C.F.R. § 4.34(b)(5)(iii). Pursuant to its policy, the Commission stayed the licensing proceeding pending resolution of the State administrative appeal. See Rehearing Order ¶ 15. This petition for review followed.
The Commission maintains the petition is not ripe for review because the ongoing administrative proceeding in North Carolina could significantly change the analysis or moot the petition altogether, and Alcoa Power would suffer little hardship if a decision on the waiver issue were delayed until the culmination of the State proceeding. We disagree.
In making the ripeness determination, the court considers two factors: “ ‘[1] the fitness of the...
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