Am. Rivers v. Fed. Energy Regulatory Comm, 98-70084

CourtUnited States Courts of Appeals. United States Court of Appeals (9th Circuit)
Citation201 F.3d 1186
Docket NumberN,No. 98-70084,98-70084
Decision Date14 January 2000

COUNSEL: Todd D. True and Kristen L. Boyles, Earthjustice Legal Defense Fund, Seattle, Washington, for petitioners American Rivers et al.;

Jas Jeffrey Adams, Justice Department, State of Oregon, Salem, Oregon, for petitioner Oregon Department of Fish and Wildlife.

Sean H. Donahue, United States Department of Justice, Environmental & Natural Resources Division, Washington D.C., for petitioner-intervenor United States Department of Interior.

John H. Conway and John S. L. Katz, Federal Energy Regulatory Commission, Washington, D.C., for the respondent.

Donald A. Haagensen, Haagensen & Lloyd, Portland, Oregon and Gail A. Greely, Alameda, California, for the respondent-intervenor Eugene Water & Electric Board.

Mason D. Morisset, Morisset, Schlosser, Ayer & Jozwiak, Seattle, Washington, for amicus curiae Skokomish Indian Tribe;

David J. Cummings, Nez Perce Tribe Office of Legal Counsel, Lapwai, Idaho, for amicus curiae Nez Perce Tribe.

Brian J. McManus, Jones, Day, Reavis & Pogue, Washington, D.C., for amici curiae American Public Power Association et al.

Mark L. Bubenik, Chief Assistant City Attorney, Tacoma, Washington, for amicus curiae City of Tacoma, Washington.

Petitions for Review of an Order of the Federal Energy Regulatory Commission Before: Edward Leavy, M. Margaret McKeown, and Kim McLane Wardlaw, Circuit Judges.


WARDLAW, Circuit Judge:

At stake in these consolidated petitions is the continued operation of two


power facilities located in Lane County, Oregon along a twenty-five mile stretch of the McKenzie River. The petitioners,1 a coalition of conservation/environmental organizations and the Oregon Department of Fish and Wildlife, challenge the decision of the Federal Energy Regulatory Commission ("FERC" or the "Commission") to reissue a hydropower license to the incumbent licensee, the Eugene Water and Electric Board ("EWEB").2 Specifically, the petitioners contend that the Commission granted the disputed license (i) without conducting the requisite environmental analysis under relevant provisions of the Federal Power Act ("FPA"), 16 U.S.C. S 791a et seq., and the National Environmental Policy Act ("NEPA"), 42 U.S.C. S 4321 et seq., and (ii) in violation of sections 10(j) and 18 of the FPA. For the reasons set forth below, we grant in part and deny in part the petitions for review.


The license under review authorizes the continued operation of the 14.5-megawatt Leaburg Hydroelectric Project and the 8-megawatt Walterville Hydroelectric Project for a duration of 40 years. See Eugene Water & Elec. Bd., 78 Fed. Energy Reg. Comm'n Rep. (CCH) P 62,207, at 64,693 (Mar. 24, 1997) ("Order Issuing New License").3 The Leaburg and Walterville facilities have operated since 1930 and 1911, respectively. The Commission's predecessor, the Federal Power Commission, granted original FPA hydropower licenses to the Walterville development in 1967 and the Leaburg development in 1968. See In re City of Eugene, 37 F.P.C. 979 (May 23, 1967); In re City of Eugene, 39 F.P.C. 904 (June 3, 1968). Both licenses expired by their terms on December 31, 1993. After the licenses expired, EWEB managed both developments under separate annual licenses by operation of FPA section 15(a).4

The Leaburg development, the project's upstream facility, consists of a dam, canal, powerhouse facilities, a tailrace, and a power substation. The dam creates a fifty-seven acre backwater called Leaburg Lake which extends approximately 1.5 miles upstream. On each side of the dam are fish ladders, only one of which is operational. On the upstream side of the dam, intake gates divert water through a downstream migrant fish screen into the five-mile Leaburg power canal. The diverted water passes through the power plant forebay into the two turbine Leaburg powerhouse. The water returns to the McKenzie River through a 1,100-foot tailrace. The bypassed reach of the McKenzie between the entrance to the Leaburg canal and the point where the diverted water rejoins the river is 5.8 miles long.

Six miles downstream, headworks divert water from the McKenzie into the unscreened, four-mile Walterville power canal. The Walterville canal feeds into a single-turbine powerhouse from which water returns to the McKenzie through a two-mile tailrace. The Walterville canal bypasses a 7.3 mile stretch of the McKenzie.

The Director issued the disputed license on March 24, 1997, pursuant to the FPA.5 Section 4(e) of the FPA empowers the Commission to issue licenses for hydroelectric projects on waterways that are subject to congressional regulation under the Commerce Clause. See 16 U.S.C.S 797(e) (1994). Section 10(a) of the FPA authorizes the Commission to issue such licenses subject to conditions that the Commission finds best suited for power development and other public uses of the nation's waters. See 16 U.S.C. S 803(a) (1994). In the mid-1980's, Congress amended these provisions to realize an increased sensitivity to environmental concerns, directing the Commission to devote greater consideration to a project's overall effect on fish and wildlife. See Electric Consumers Protection Act of 1986 ("ECPA"), Pub. L. No. 99-495, 100 Stat. 1243 (1986) (codified principally at 16 U.S.C.SS 797(e), 803(a)(1), 803(j)).6 The new license reflects many of these concerns and would require EWEB to construct several new facilities and provide other measures for the benefit and protection of the fish populations that pass through and reside in the project area. See Order Issuing New License, 78 Fed. Energy Reg. Comm'n Rep. (CCH) at 64,706-719.7 From a power standpoint, the new license authorizes EWEB to increase the project's generation capacity from 22.5 megawatts to 23.2 megawatts. See id. at 64,708. Under the terms of the license, EWEB would achieve this increased generation capacity by raising the water level at Leaburg Lake by 18 inches, constructing fixed sill dams or other diversion structures at the head of the Walterville power canal, replacing the turbine runners at both powerhouses, and excavating the Walterville tailrace. See id. at 64,701-703. The license also would increase the minimum flows8 in the bypassed reaches below the diversions of both developments to 1,000 cubic feet per second. See id. at 64,703.

During the relicensing deliberations, the Director considered the final environmental impact statement prepared by the Commission's environmental staff.9 The Commission's staff issued the final environmental impact statement on January 8, 1997, after soliciting and receiving comments on a draft. The staff had evaluated the proposed project conditions set forth in EWEB's application, alternatives to the proposals, resource agency recommendations, Commission staff-developed recommendations, and public comments. Specifically, the staff considered EWEB's relicensing proposal and five alternatives: (1) the "no action" alternative; (2) issuing a new license to EWEB with all of the modifications and enhancement measures proposed by the resource agencies; (3) issuing a new license which would combine some of the measures recommended by resource agencies with others developed by Commission staff; (4) issuing a nonpower license; and (5) project retirement. The final environmental impact statement defined the "no action" alternative as the existing projects as "operate[d] under the terms and conditions of their original licenses." Leaburg-Walterville Hydroelectric Project (FERC Project No. 2496), Oregon, Final Environmental Impact Statement, S 2.3, at 2-6 (Dec. 1996). Under this alternative, "[n]o new environmental protection or enhancement measures would be implemented." Id. The final environmental impact statement stated that it had "use[d] this alternative to establish baseline environmental conditions for comparison with other alternatives." Id.

The Commission's staff also examined the conditions submitted by the state and federal fish and wildlife agencies under color of FPA sections 10(j) and 18.10 The staff adopted many of the fifty-six recommendations designated pursuant to section 10(j). The final environmental impact statement, however, stated that twenty-one of the fifty-six recommendations were outside the scope of section 10(j). The Commission's staff concluded that these recommendations either did not serve to protect fish and wildlife resources or conferred final authority over the level of enhancement and project operations upon the agencies rather than the Commission. The final environmental impact statement nevertheless considered and adopted many of these submissions under FPA sections 10(a) and 4(e) which grant the Commission broader latitude to balance environmental and development interests. The Commission's staff also recommended the outright adoption of the federal agencies' section 18 conditions which required implementation of fish ladders and fish screens but determined that the remaining conditions lodged under color of section 18 did not constitute "fishway prescriptions." Again, the Commission analyzed and adopted many of these measures under sections 10(a) and 4(e).11

After issuing the final environmental impact statement, the Commission's staff convened a meeting with several of the...

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