Idaho Power Co. v. Federal Power Commission, 10530.

• Decision Date: 10 May 1951
• Docket Number: No. 10530.,10530.
• Citation: 189 F.2d 665
• Parties: IDAHO POWER CO v. FEDERAL POWER COMMISSION.
• Court: U.S. Court of Appeals — District of Columbia Circuit

189 F.2d 665 (1951)

IDAHO POWER CO v. FEDERAL POWER COMMISSION.

No. 10530.

United States Court of Appeals District of Columbia Circuit.

Argued December 11, 1950.

Decided May 10, 1951.

A. C. Inman, of the Bar of the Supreme Court of Idaho, Boise, Idaho, pro hac vice, by special leave of Court, and Harry Poth, Jr., Washington, D. C., for petitioner.

Willard W. Gatchell, Asst. General Counsel, Federal Power Commission, Washington, D. C., with whom Bradford Ross, General Counsel, Federal Power Commission, and John C. Mason, Attorney, Federal Power Commission, Washington, D. C., were on the brief, for respondent.

Before WILBUR K. MILLER and PRETTYMAN, Circuit Judges, and KIMBROUGH STONE, Circuit Judge, retired (sitting by designation).

PRETTYMAN, Circuit Judge.

This is a petition to review an order of the Federal Power Commission, granting a license for the construction, operation and maintenance of a power project on federal lands. Petitioner (hereinafter called the "Company") is a private corporation, a public utility, and was the applicant for the license. Its prayer to this court is that the order of the Commission be modified by striking therefrom certain conditions imposed by the Commission upon the license.

In 1947 the Company applied for a license for the construction, operation and maintenance of a hydroelectric project, including a dam and a power plant, located on the Snake River in south-central Idaho, occupying in part lands of the United States. This application was pursuant to Section 4(e) of the Federal Power Act.¹ In 1948 the Commission authorized issuance of the license but reserved "the right to determine at a later date what transmission facilities should be included in the license as part of the project." In 1949 the Company applied for an amendment of its license to include as a part of the project two proposed high-voltage (138,000 volts) primary transmission lines. One such line was to run approximately 73 miles from the power plant to a point near the City of Boise. The other was to run approximately 116 miles from the plant to a point near the City of American Falls. Both lines crossed lands of the United States, and both joined the Company's interconnected primary transmission system. The Company applied for and was granted prelicense permission to proceed with the construction of the two lines, pending consideration of the application for amendment. In October, 1949, the Commission entered an order, which superseded its original order, authorizing the license. Among other things, this new order authorized the construction of the two 138-kilo-volt lines as part of the project but imposed upon such construction and operation certain special conditions.

These special conditions are reproduced in full text in footnote 2 below,² but they may be summarized as follows:

The Company shall not convert the lines to permit operation at a higher voltage without prior approval of the Commission, but, upon request of the Secretary of the Interior and after one year's notice from the Commission, the Company shall convert the lines for operation at 230 kilovolts. The Company shall permit the United States to interconnect any of its (i. e., the United States') transmission facilities with these two lines, provided there is capacity available in the lines in excess of the needs of the Company. Upon completion of such interconnections the United States shall have the right to transfer energy over the lines in such amounts as will not unreasonably interfere with the Company's use of the lines. After any such interconnection the Company shall, except in emergencies, maintain in a closed position all connections between the Company's lines and the interconnecting facilities of the United States. If, after the Company commences transmission of energy over its lines for the United States, the Company notifies the Commission that it needs the whole or any substantial part of the capacity of the lines then being utilized by the United States, the Company may modify or revoke the agreement to remain interconnected by giving the Commission 30 months' notice. Any agreement between the Company and the United States in connection with the transmission lines shall be effective only upon approval by the Commission. In the event the Company and the United States are unable to agree with respect to any matter arising in connection with the transmission lines, the question thereby raised shall be submitted to the Commission for determination.

In sum, the Commission required, as conditions to the license, that the licensee agree to increase the capacity of its lines at Government request and thereafter to transmit Government power, the lines to remain interconnected unless and until thirty months' notice is given. The question presented by this petition for review is whether the Commission has authority to impose those conditions upon a license for the construction and operation of a power project upon federal lands under the terms of the Federal Power Act.

It is necessary that we first delimit the question. There is no doubt as to the power of Congress to impose such conditions as are proper in its judgment to be imposed upon the use of public lands. The Constitution³ specifically provides: "The Congress shall have Power to dispose of and make all needful Rules and Regulations respecting the Territory or other Property belonging to the United States; * * *."

No question of contract is involved. No question is raised as to the character of the transmission lines as primary and thus as part of the power project within the meaning of the statute. No question is raised as to the financial terms incorporated in the proposed conditions; the terms of the license as proposed by the Commission include detailed provisions as to compensation to the Company by the United States for the expense of converting the lines and for transmitting energy of or for the United States.

As thus delimited the question before us is: Has Congress conferred upon the Commission authority to impose upon a license for a power project on public lands requirements that the licensee increase the proposed capacity of its primary transmission lines, interconnect those lines with power project of the United States, and transmit over its lines for the United States power generated by or belonging to the United States? We are of opinion that the Commission does not have the statutory authority which it here claims.

The question whether the United States should require a private company, licensed to construct a private power plant on public lands or to cross public lands with its transmission lines, to interconnect its facilities with public power projects, was a major one in the consideration of the policies and terms of power development upon public property. It was a highly controversial issue. During the course of the consideration of the bill which eventually became the Federal Power Act, the subject was broached at least three times, and upon each occasion the witness testifying on behalf of the bill as the representative of the Power Commission assured the Congress that the proposed bill did not make it possible for the Government to utilize the transmission lines of private companies or to require the transmission of power generated by a Government plant over the lines of private operating companies. Three excerpts from this testimony are reproduced in footnote 4 below.⁴ Finally Congress inserted in the statute, as Section 201(f),⁵ a provision that no provision in that Part of the statute shall be deemed to include the United States or any of its agencies. That Part is the Part which deals with, among other things, the interconnection and co-ordination of facilities. The specific exclusion of the facilities of the United States from the possibility of interconnection and coordination under the terms of that Part of the statute seems clearly to be a declaration of congressional intent upon the subject. So much seems plain enough.

At this point the argument turns to specific terms in the statute. The Federal Power Act is in Parts. Part I deals with licenses and Part II deals with the interconnection of facilities. The exclusion of the United States, which we have just discussed, is in Part II, and its language is: "No provision in this Part shall apply to, or be deemed to include, the United States * * *."⁶ The Commission says that under this language the exclusion applies only to provisions of Part II and has no application to licenses, which are treated in Part I.

We examine Part I. It prescribes the conditions upon which licenses should be issued. It does not mention interconnection with Government facilities or transmission of Government energy as permissible conditions. But the Commission points to the catchall clause at the end of the specified conditions. That general clause, read in conjunction with the introductory clause of the Section, is: "All licenses issued under this Part shall be on the following conditions: * * *.

"(g) Such other conditions not inconsistent with the provisions of this Act as the commission may require."⁷

The language prohibits conditions inconsistent with other provisions "of this Act" — not of Part I alone but of the Act. The exclusion of the United States from interconnecting arrangements, while in Part II, is nevertheless in the Act. And so this general clause in Part I, upon which the Commission relies, forbids conditions upon licenses inconsistent with other provisions throughout the Act. Specifically, it forbids, among other things, a condition inconsistent with the exclusion of the United States from interconnection arrangements.

The Commission next says that its general power to prescribe conditions must be interpreted in the light of the opening clauses of the Section (Section 10, which is in Part I) which relates to...