American Rivers, et al v. FERC, et al
Filing
OPINION [1739365] filed (Pages: 40) for the Court by Judge Millett and Judge Sentelle. [16-1195, 16-1336]
USCA Case #16-1195
Document #1739365
Filed: 07/06/2018
United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued January 12, 2018
Decided July 6, 2018
No. 16-1195
AMERICAN RIVERS AND ALABAMA RIVERS ALLIANCE,
PETITIONERS
v.
FEDERAL ENERGY REGULATORY COMMISSION AND UNITED
STATES SECRETARY OF THE INTERIOR,
RESPONDENTS
ALABAMA POWER COMPANY,
INTERVENOR
Consolidated with 16-1336
On Petitions for Review of Orders of the
Federal Energy Regulatory Commission
Megan H. Huynh argued the cause for petitioners. On the
briefs were Catherine Wannamaker and Sarah Stokes.
Anand Viswanathan, Attorney, Federal Energy Regulatory
Commission, argued the cause for respondent. With him on
the brief were David L. Morenoff, General Counsel at the time
the brief was filed, and Robert H. Solomon, Solicitor.
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Allen M. Brabender, Attorney, U.S. Department of Justice,
argued the cause for respondent the Secretary of the Interior.
With him on the brief was Eric Grant, Deputy Assistant
Attorney General. David C. Shilton and Robert J. Lundman,
Attorneys, entered appearances.
James A. Byram Jr., James H. Hancock Jr., Jason B.
Tompkins, Peter D. Keisler, and C. Frederick Beckner III were
on the brief for intervenor Alabama Power Company.
Before: SRINIVASAN and MILLETT, Circuit Judges, and
SENTELLE, Senior Circuit Judge.
MILLETT, Circuit Judge, and SENTELLE, Senior Circuit
Judge: Many portions of Alabama’s and Georgia’s Coosa
River ecosystem are in fragile condition after, among other
things, decades of power plant operations and development.
In 2013, the Federal Energy Regulatory Commission granted
the Alabama Power Company a 30-year license to continue
power generation on a portion of the Coosa River. A review
of the licensed project’s impact on the environment and
endangered species documented that the project would cause a
100% take of multiple endangered mussels, a large loss of
indigenous fish, and perilously low dissolved oxygen levels for
substantial periods of time.
Nevertheless, the Commission concluded that licensing
the generation project would have no substantial impact on
either the River’s ecological condition or endangered species.
In doing so, the Commission declined to factor in the decades
of environmental damage already wrought by exploitation of
the waterway for power generation and that damage’s
continuing ecological effects. Because the Commission’s
environmental review and a biological opinion it relied on were
unreasoned and unsupported by substantial evidence, the
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Commission’s issuance of the license was arbitrary and
capricious. Accordingly, we dismiss the first petition for
review, grant the second petition for review, vacate the
licensing decision, and remand for further proceedings
consistent with this opinion.
I
A
This case implicates three intersecting statutory schemes,
all of which are designed to force federal agencies to carefully
assess and address the environmental impacts of large-scale
development projects.
1. The Federal Power Act, 16 U.S.C. § 791 et seq.,
charges the Federal Energy Regulatory Commission with
licensing the development, improvement, and operation of
hydroelectric projects along navigable waterways. No license
may be issued unless the Commission first determines that the
proposed project “will be best adapted to a comprehensive plan
for improving or developing” the relevant waterways. Id.
§ 803(a)(1); see also id. § 797(e). In making that judgment,
the Commission must give “equal consideration to the purposes
of energy conservation, the protection, mitigation of damage
to, and enhancement of, fish and wildlife (including related
spawning grounds and habitat), the protection of recreational
opportunities, and the preservation of other aspects of
environmental quality.” Id. § 797(e).
When an existing license holder seeks to renew its license,
“the Commission shall * * * take into consideration * * * (A)
[t]he existing licensee’s record of compliance with the terms
and conditions of the existing license [and] (B) [t]he actions
taken by the existing licensee related to the project which affect
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the public.” 16 U.S.C. § 808(a)(3)(A)–(B). And whether
issuing the first license for a project or relicensing an ongoing
project, the Commission must equally advance the Federal
Power Act’s multifaceted purposes and ensure that the licensed
project is the most viable option for developing a waterway.
Id. §§ 797(e), 803(a)(1)(2). While a relicensing decision is
under review, the Commission also must maintain the powergeneration status quo by temporarily extending the expired
license on its original terms and conditions. Id. § 808(a)(1).
2. The National Environmental Policy Act (“NEPA”),
42 U.S.C. § 4321 et seq., obligates federal agencies to analyze
the environmental consequences of proposed major federal
actions and to factor those impacts into its decisionmaking.
Under NEPA, agencies may first conduct an Environmental
Assessment (“Assessment”) to determine whether the
proposed federal action will significantly impact the quality of
the human environment. 40 C.F.R. §§ 1501.4; 1508.9(a). If
that Assessment reveals that the environmental consequences
of the agency’s proposed action will not be significant, the
agency must issue a “[f]inding of no significant impact,”
explaining why the agency action will not significantly affect
the environment. Id. §§ 1508.9; 1508.13. But if the
Assessment demonstrates that significant effects could result,
the agency must prepare an Environmental Impact Statement,
42 U.S.C. § 4332(C), describing a “range of alternatives” and
explaining how the agency’s ultimate decision will comply
with environmental laws and policies, 40 C.F.R. § 1502.2.
3. The Endangered Species Act (“ESA”), 16 U.S.C.
§ 1531 et seq., broadly protects endangered and threatened
animal and plant species as well as their habitats. The
Department of the Interior’s Fish and Wildlife Service
(“Service”) is charged with administering the Act. See 50
C.F.R. § 402.01(b). Once the Service lists a species as
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threatened or endangered, the Endangered Species Act requires
“[e]ach federal agency,” in consultation with the Service, to
ensure that any action “authorized, funded, or carried out by
such agency * * * is not likely to jeopardize the continued
existence of any endangered species or threatened species or
result in the destruction or adverse modification of [the] habitat
of such species[.]” Id. § 1536(a)(2).
As part of that inter-agency consultation process, the
Service will issue a “biological opinion” that explains whether
“the action, taken together with cumulative effects, is likely to
jeopardize the continued existence of listed species[.]” 50
C.F.R. § 402.14(g)(4). If the Service determines that the
agency action is not likely “to jeopardize the continued
existence of any species,” 16 U.S.C. § 1536(a)(2), but will
result in the “incidental taking” of some members of the listed
species, the biological opinion must spell out “the impact of
such incidental taking on the species,” describe “reasonable
and prudent measures * * * necessary or appropriate to
minimize such impact,” and set “the terms and conditions
(including, but not limited to, reporting requirements) that must
be complied with” for the agency action to go forward, id.
§ 1536(b)(4)(C); see 50 C.F.R. § 402.14(i). The Endangered
Species Act defines “take” broadly, meaning “to harass, harm,
pursue, hunt, shoot, wound, kill, trap, capture, or collect” any
listed species. 16 U.S.C. § 1532(19).
B
1
The Coosa River Basin spreads across about 10,161 square
miles in Alabama, Georgia, and Tennessee. The Coosa River
is formed by the confluence of the Oostanaula and Etowah
Rivers near Rome, Georgia, and it flows 267 miles south where
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it meets with the Tallapoosa River in Alabama. Order Issuing
New License, 143 FERC ¶ 61,249 P 8 (2013) (“Licensing
Order”). The Coosa River is a highly regulated waterway
with nine hydropower and storage developments controlling its
flow. Each of those developments is operated by either the
Alabama Power Company or the United States Army Corps of
Engineers.
Alabama Power operates seven hydroelectric generator
and storage developments along waterways located primarily
in Alabama. The Company’s developments on the Coosa
River (“the Coosa Project”) are at the center of this dispute.
From upstream to downstream, the developments are: (1)
Weiss; (2) H. Neely Henry; (3) Logan Martin; (4) Lay; (5)
Mitchell; (6) Jordan; and (7) Bouldin. The Army Corps of
Engineers operates an additional five developments along the
same waterways and extending into neighboring States, none
of which are directly at issue in this case.
The Coosa Project traces its roots back to the 1920s, when
the Mitchell and Jordan hydropower plants were licensed and
constructed. The Army Corps of Engineers oversaw the
projects with the goal of developing the Alabama-Coosa River
system to support navigation, flood control, and hydroelectric
power generation.
Some three decades later, Congress suspended federal
hydropower development of the Coosa River in favor of private
development under licenses issued by the federal government.
Alabama Power received its first Coosa River license in 1957
and proceeded to construct and operate five additional
developments.
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2
Licenses for the original Coosa Project, as well as for
Mitchell and Jordan hydropower plants, were all scheduled to
expire on July 31, 2007. Two years before that deadline,
Alabama Power tendered its application for relicensing of all
of its developments, as required by 16 U.S.C. § 808(c)(1). In
its application, Alabama Power sought to consolidate all of the
projects into a single license. The Commission published a
notice of the license application in the Federal Register in June
2008, indicating that “the application was ready for
environmental analysis” and soliciting protests, comments, and
recommendations. Licensing Order at P 5. A number of
public and private conservation and natural resource
stakeholders timely intervened, including Alabama Rivers
Alliance, American Rivers, Atlanta Regional Commission,
American Whitewater, Coosa River Paddling, and World
Wildlife Fund (collectively, the “Conservation Groups”).
Eighteen months after the Federal Register notice, the
Commission issued its final Environmental Assessment on the
license application. That Assessment concluded that the
relicensing decision did not constitute a major federal action
significantly affecting the environment, and so the
Commission issued a “Finding of No Significant Impact.” See
40 C.F.R. § 1508.13.
Two and a half years later, in June 2012, the Fish and
Wildlife Service issued its Biological Opinion analyzing the
impact of renewing the license on endangered and threatened
species in the project area, with particular focus on the Coosa
River’s nine listed species and twelve critical habitats. See
generally Biological Opinion for the Relicensing of Alabama
Power Company’s Coosa River Hydroelectric Project (2012)
(“Biological Opinion”). The Biological Opinion concluded
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that relicensing the project was not likely to “jeopardize” any
threatened or listed species, nor destroy or deleteriously affect
any critical habitats. Biological Opinion at 89–90.
On June 20, 2013, the Commission granted Alabama
Power a new 30-year license to continue operating the nowcombined Coosa Project. Both the Commission’s final
Environmental Assessment and the Service’s Biological
Opinion were incorporated, without change, into the license.
See Licensing Order at PP 200–214, Appendix B. The license
imposed several terms and conditions on Alabama Power’s
operations, including as most relevant here, the duty to (i)
implement “aeration” measures to achieve a constant minimum
dissolved oxygen level of 4.0 milligrams per liter (“mg/L”) at
each development “at all times,” (ii) enhance dissolved oxygen
levels at Logan Martin during periods of non-generation to
protect certain listed aquatic species, (iii) incorporate waterquality monitoring measures prescribed by the Alabama
Department of Environmental Management, and (iv) conduct
surveys of aquatic species to ensure no further decline of
threatened and endangered mussels and snails. Id. at PP 72–
73.
Several parties, including the Conservation Groups and
Alabama Power, timely sought rehearing of the Licensing
Order. The Commission denied the Conservation Groups’
rehearing request in full. But it granted Alabama Power’s
request, materially slackening Alabama Power’s duty to
maintain the required levels of dissolved oxygen.
In
particular, the Commission provided that the prescribed water
quality standards, including the maintenance of dissolved
oxygen levels, would apply only when the hydroelectric
developments were actually generating power. Order on
Rehearing and Clarification and Dismissing Request for Stay,
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155 FERC ¶ 61,080 (2016) (“First Rehearing Order”). That
is generally less than 20% of the year.
The Conservation Groups filed a petition in this court
seeking review of the Commission’s Licensing Order, First
Rehearing Order, and the Biological Opinion on the ground
that they violated the Federal Power Act, NEPA, and the
Endangered Species Act. Meanwhile, the Conservation
Groups submitted a second rehearing request to the
Commission addressing the significantly lowered waterquality standards and alteration of the dissolved oxygen levels,
as well as reiterating the objections from their first request for
rehearing. The Commission denied that request. Order
Denying Rehearing, 156 FERC ¶ 61,171 (2016) (“Second
Rehearing Order”).
Two weeks later, the Conservation Groups filed a second
petition for review in this court challenging the Commission’s
Second Rehearing Order. They also immediately moved to
consolidate their two petitions for review. We granted the
motion to consolidate.
II
Because confirming jurisdiction must always be a federal
court’s first inquiry, we start there.
A
Although the Commission and the Secretary of the Interior
have not challenged the Conservation Groups’ standing to seek
review of the Commission’s licensing orders, intervenor
Alabama Power Company argues that the Conservation Groups
have failed to establish standing for any of the issues raised in
either petition. “Even in the absence of intervenor’s objection,
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we would be required to review petitioners’ standing.”
Grocery Mfrs. Ass’n v. EPA, 693 F.3d 169, 174 (D.C. Cir.
2012).
Article III standing is jurisdictional, and “we have an
‘independent obligation to be sure of our jurisdiction.’” Id.
(quoting Sierra Club v. EPA, 292 F.3d 895, 898 (D.C. Cir.
2002)). If neither American Rivers nor Alabama Rivers
Alliance “has Article III standing, then this court has no
jurisdiction to consider these petitions.” Id. (citing Lujan v.
Defenders of Wildlife, 504 U.S. 555, 560 (1992)). Therefore,
before we reach the merits of the petitions, we must determine
whether the Conservation Groups have standing to raise those
petitions in court.
Each petitioner asserts that it has associational standing.
“An organization has associational standing to bring suit on its
members’ behalf when: (1) at least one of its members would
have standing to sue in his or her own right; (2) ‘the interests it
seeks to protect are germane to the organization’s purpose’;
and (3) ‘neither the claim asserted nor the relief requested
requires the participation of individual members in the
lawsuit.’” Sierra Club v. FERC, 827 F.3d 59, 67 (D.C. Cir.
2016) (quoting WildEarth Guardians v. Jewell, 738 F.3d 298,
305 (D.C. Cir. 2013)). It is clear and undisputed that the
Conservation Groups meet the latter two requirements of
associational standing. The only question is whether the first
requirement is met.
“To satisfy the first requirement of the associational
standing inquiry, [the Conservation Groups] must show that:
(1) at least one of [their] members has suffered an ‘injury-infact’ that is ‘concrete and particularized’ and ‘actual or
imminent, not conjectural or hypothetical’; (2) the injury is
‘fairly traceable to the challenged action’; and (3) it is ‘likely,
as opposed to merely speculative, that the injury will be
redressed by a favorable decision.’” WildEarth Guardians,
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738 F.3d at 305 (quoting Friends of the Earth, Inc. v. Laidlaw
Envtl. Servs. (TOC), Inc., 528 U.S. 167, 180–181 (2000)).
Under controlling precedent, associations like the
Conservation Groups “adequately allege injury in fact when
they aver that [one or more members] use the affected area and
are persons ‘for whom the aesthetic and recreational values of
the area will be lessened’ by the challenged activity.”
WildEarth Guardians, 738 F.3d at 305 (quoting Laidlaw, 528
U.S. at 183). The Conservation Groups allege that their
members will be injured because the license will adversely
affect their recreational use of the river and their interest in
observing the biodiversity of the Coosa River. In support of
this alleged injury, the Conservation Groups submitted
declarations from multiple members attesting to their use and
enjoyment of the Coosa River and the alleged negative impacts
that the license will have on that use and enjoyment.
Alabama Power argues that the Conservation Groups fail
to show injury because they cannot show that the license
threatens their current recreational interest in the Coosa River.
Alabama Power contends that the Conservation Groups’
members will be able to continue to use the Coosa River as they
have always used it because the new license will benefit the
Coosa River, not harm it. However, that argument goes to the
merits not standing. The Environmental Assessment and
Biological Opinion recognize the possibility of “[f]luctuating
flow releases,” “intermittent periods of low [dissolved
oxygen],” and other potential “poor water quality conditions”
that could “adversely affect some aquatic species” and “aquatic
resources.”
Environmental Assessment at 222, 250;
Biological Opinion at 90–93. The Conservation Groups’
members expressed interests in observing and enjoying the
diversity of the Coosa River. The increased risks to water
quality and endangered and threatened species in the Coosa
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River satisfy the injury-in-fact requirement. Alabama Power
contends that this license imposes more stringent requirements
or may improve some environmental conditions.
The
Conservation Groups have adequately alleged that even these
allegedly improved conditions will continue to harm their use
and enjoyment of the Coosa River. Whether the evidence of
harm ultimately supports the allegation is a question for a later
day. In short, the Conservation Groups have adequately
alleged a concrete and imminent injury to their members’ use
and enjoyment of the Coosa River that is traceable to the
Commission’s decision to issue a license and redressable by
revocation or alteration of its terms.
In addition to the injury to their members’ use and
enjoyment of the Coosa River, the Conservation Groups allege
that the Commission’s failure to prepare an Environmental
Impact Statement constitutes a procedural injury. “Where, as
here, a party alleges deprivation of its procedural rights, courts
relax the normal standards of redressability and imminence.”
Sierra Club, 827 F.3d at 423. To establish causation, the
Conservation Groups “need demonstrate only that ‘the
procedural step was connected to the substantive result,’ not
that ‘the agency would have reached a different substantive
result’ but for the alleged procedural error.” Id. (quoting
WildEarth Guardians, 738 F.3d at 306). “[A]n adequate
causal chain must contain at least two links: one connecting
the omitted [Environmental Impact Statement] to some
substantive government decision that may have been wrongly
decided because of the lack of an [Environmental Impact
Statement] and one connecting that substantive decision to the
plaintiff’s particularized injury.” WildEarth Guardians, 738
F.3d at 306 (quoting Florida Audubon Soc’y v. Bentsen, 94
F.3d 658, 668 (D.C. Cir. 1996) (en banc)). Applying that
precedent to this case, the Conservation Groups do not need to
show that the preparation of an Environmental Impact
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Statement would have led to a different ultimate result, but only
that the requirement for such a report is connected to the
ultimate decision. The Conservation Groups have adequately
alleged that the omission of the Environmental Impact
Statement was causally connected to the issuance of the license
which they allege will harm their members’ use and enjoyment
of the Coosa River.
“The relaxed redressability requirement is also satisfied.”
WildEarth Guardians, 738 F.3d at 306. “Vacatur of the
[licensing] order would redress [the Conservation Groups’]
members’ injuries because, if [the Commission] is required to
adequately consider each environmental concern, it could
change its mind about” issuing the license. Id. Alabama
Power argues that the Conservation Groups’ injury cannot be
redressed because “NEPA is forward looking and does not
require federal agencies to restore biodiversity that may have
been lost due to decisions that were made long ago.”
Intervenor Br. 15. Although Alabama Power may be correct
in the generality of its statement, on the specifics of the case
before us, the Conservation Groups seek to prevent future
deterioration to the biodiversity of the Coosa River so that the
future use and enjoyment of their members are not impaired.
This injury is redressable. Requiring the Commission to
prepare an Environmental Impact Statement might cause the
Commission to gather more information that could improve the
conditions in the license and the conditions of the Coosa River.
Under these circumstances, the Conservation Groups have
established standing to challenge the Coosa River Project
license.
B
Alabama Power also argues that the Conservation Groups’
first petition for review is jurisdictionally barred, and that this
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court is limited to reviewing only the challenges raised in their
second petition for review, which were aimed at the Biological
Opinion and the materially reduced water quality standards.
Alabama Power is half right. The first petition for review
must be dismissed, but the second petition for review
encompasses the Conservation Groups’ challenges to both the
Biological Opinion and the Environmental Assessment.
The Federal Power Act generally requires any party
seeking judicial review of a Commission order to first present
its claims in an application for rehearing to the Commission.
See 16 U.S.C. § 825l(a), (b). Once the Commission acts on
the application, the party has sixty days to file its petition for
judicial review. Id. § 825l(b).
After the Commission granted Alabama Power its license,
both the Conservation Groups and Alabama Power filed timely
applications for rehearing.
The Conservation Groups’
application challenged the Licensing Order’s compliance with
NEPA, the Endangered Species Act, and the Federal Power
Act.
Three years later, the Commission denied the
Conservation Groups’ rehearing request and granted Alabama
Power Company’s request by substantially weakening the
required water quality standards. First Rehearing Order at P
150.
The Conservation Groups quickly filed a second
application for rehearing before the Commission that both (i)
challenged the Commission’s decision to decrease the water
quality standards originally required by the license, and (ii)
incorporated by reference the Groups’ NEPA, Federal Power
Act, and Endangered Species Act challenges from their first
rehearing application.
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While that second rehearing request was still pending
before the Commission, the Conservation Groups filed a
petition for review in this Court seeking review of the
Licensing Order, the First Rehearing Order, and the Biological
Opinion. 1 The Commission moved to dismiss that petition for
lack of jurisdiction due to the ongoing rehearing proceedings
before the Commission. Resp’ts’ Mot. to Dismiss for Lack of
Jurisdiction 1.
The Commission denied the Conservation Groups’ second
request for rehearing shortly thereafter. Second Rehearing
Order at P 1. The Conservation Groups then promptly filed a
second petition for review in this court challenging that denial
and the Biological Opinion. The next day, the Conservation
Groups moved to consolidate their two petitions for review.
That action prompted the Commission to withdraw its earlier
motion to dismiss. This court granted consolidation in
November 2016.
The Conservation Groups’ first petition for review is
jurisdictionally barred. The law is “well-established that a
party may not simultaneously seek both agency reconsideration
and judicial review of an agency’s order.” Tennessee Gas
Pipeline Co. v. FERC, 9 F.3d 980, 980 (D.C. Cir. 1993)
1
The Conservation Groups have explained that they filed their
first petition in an effort to protect against any risk of having a later
challenge to the first denial of rehearing deemed untimely. See
Pet’rs’ Opp. to Mot. to Dismiss 5 (explaining that the first petition
for review was filed because the Groups “did not want to risk losing
their right to appeal despite the pending second request for
rehearing”). We have advised parties that are unsure whether a
rehearing order has made a significant change to an underlying
license to follow the “safer course” by filing a protective petition for
review. Smith Lake Improvement & Stakeholders Ass’n v. FERC,
809 F.3d 55, 58 (D.C. Cir. 2015).
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(citation omitted). Because the Conservation Groups’ first
petition for review was filed while its second request for
agency reconsideration was still pending before the
Commission, it was “incurably premature and must be
dismissed for lack of jurisdiction.” Id. at 981 (internal
quotation marks omitted); see also Smith Lake Improvement &
Stakeholders Ass’n v. FERC, 809 F.3d 55, 57–58 (D.C. Cir.
2015).
All is not lost for the Conservation Groups, however.
Their second petition for review filed with this court was both
proper and timely. But the content of that second petition for
review raises another issue: it specifically sought review only
of the Commission’s Second Rehearing Order and the
Biological Opinion. The second petition did not list the
underlying Licensing Order or the First Rehearing Order as the
decisions for which review was sought.
Federal Rule of Appellate Procedure 15 requires that a
petition for review must “specify the order * * * to be
reviewed.” FED. R. APP. P. 15(a)(2)(C). But a “mistaken or
inexact specification of the order to be reviewed” is “not fatal,”
as long as the “intent to seek review of a specific order [i] can
be fairly inferred from the petition for review or from other
contemporaneous filings, and [ii] the respondent is not misled
by the mistake.” Entravision Holdings, LLC v. FCC, 202 F.3d
311, 313 (D.C. Cir. 2000) (emphases added) (collecting cases
in which the petitioner’s intent to obtain review was inferred
from contemporaneous filings).
Fortunately for the Conservation Groups, their intent to
seek review of all three of the Commission’s Orders and the
Service’s Biological Opinion can be fairly inferred from the
motion to consolidate the two petitions for review, the
docketing statement, the statement of issues, and the
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underlying decisions attached to the appeal. See Martin v.
FERC, 199 F.3d 1370, 1371–1373 (D.C. Cir. 2000)
(concluding that a contemporaneously filed motion to stay,
docketing statement, and certificate as to rulings under review
demonstrated the petitioner’s intent also to seek review of the
Certificate Order, even though it was not initially listed in the
petition for review); Damsky v. FCC, 199 F.3d 527, 532–534
(petitioner’s contemporaneously filed Notice of Appeal and
Concise Statement of Reasons adequately “brought the
[challenged order] before this court for review.”); see also
Entravision, 202 F.3d at 314 (denying review of an underlying
order because petitioner’s intent to seek review could not be
inferred from contemporaneous filings, such as the docketing
statement and statement of issues, which did not reference the
order).
Nor was the Commission in any way misled or prejudiced
by the Conservation Groups’ seriatim filings.
The
Commission has claimed no prejudice before this court and, in
fact, agreed to the Groups’ consolidation of the two petitions.
In the Commission’s view, “[b]ecause [the] Conservation
Groups filed a second petition for review * * * and because
they moved to consolidate both petitions for review, dismissal
of their first petition for review will have no practical effect on
the issues presented for this Court’s review.” FERC Br. 5
(emphasis added). Nor does Alabama Power identify any
concrete harm or prejudice to its litigation of this case.
For those reasons, we can fairly infer the Conservation
Groups’ intent to seek review of all three Commission Orders
and the Biological Opinion, and allowing them to do so will
result in no harm to the Commission or Alabama Power.
On to the merits.
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III
A
“Our review is governed by Section 706 of the
Administrative Procedure Act, requiring us to determine that
agency decisions are not ‘arbitrary, capricious, an abuse of
discretion, or otherwise not in accordance with law.’” City of
Tacoma v. FERC, 460 F.3d 53, 76 (D.C. Cir. 2006) (quoting 5
U.S.C. § 706). The Conservation Groups argue that the Fish
and Wildlife Service’s Biological Opinion does not comply
with the Endangered Species Act because it failed to properly
analyze the relevant environmental baseline or effects of the
action, it failed to include an adequate statement of incidental
take, and it failed to make a rational connection between facts
found and the conclusion that the Coosa River Project will not
jeopardize listed species or adversely modify critical habitat.
Under the standard of review, the Opinion “must be upheld
as long as the [Fish and Wildlife Service] ‘considered the
relevant factors and articulated a rational connection between
the facts found and the choice made.’” City of Tacoma, 460
F.3d at 76 (quoting Arizona Cattle Growers’ Ass’n v. FWS, 273
F.3d 1229, 1235–1236 (9th Cir. 2001)).
For every species that is listed as endangered or
threatened, Section 7 of the Endangered Species Act requires
each federal agency, in consultation with the Secretary of the
Interior, to “insure that any action authorized, funded, or
carried out by such agency * * * is not likely to jeopardize the
continued existence of any endangered species or threatened
species or result in the destruction or adverse modification of
[critical] habitat[s] of such species.” 16 U.S.C. § 1536(a)(2).
“When an agency concludes that its activities may adversely
affect a listed species, it must engage in a formal consultation
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with the Interior Department’s Fish and Wildlife Service[.]”
Rancho Viejo, LLC v. Norton, 323 F.3d 1062, 1064 (D.C. Cir.
2003) (citing 50 C.F.R. § 402.14). As part of its formal
consultation, the Fish and Wildlife Service must:
(1) Review all relevant information provided
by the Federal agency or otherwise
available. Such review may include an
on-site inspection of the action area with
representatives of the Federal agency and
the applicant.
(2) Evaluate the current status of the listed
species or critical habitat.
(3) Evaluate the effects of the action and
cumulative effects on the listed species or
critical habitat.
(4) Formulate its biological opinion as to
whether the action, taken together with
cumulative effects, is likely to jeopardize
the continued existence of listed species
or result in the destruction or adverse
modification of critical habitat.
50 C.F.R. § 402.14(g). The “[e]ffects of the action refers to
the direct and indirect effects of an action on the species or
critical habitat, together with the effects of other activities that
are interrelated or interdependent with that action, that will be
added to the environmental baseline.” 50 C.F.R. § 402.02
(emphasis added). Further, “[t]he environmental baseline
includes the past and present impacts of all Federal, State, or
private actions and other human activities in the action area, the
anticipated impacts of all proposed Federal projects in the
action area that have already undergone formal or early section
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7 consultation, and the impact of State or private actions which
are contemporaneous with the consultation in process.” Id.
To “[j]eopardize the continued existence of means to
engage in an action that reasonably would be expected, directly
or indirectly, to reduce appreciably the likelihood of both the
survival and recovery of a listed species in the wild by reducing
the reproduction, numbers, or distribution of that species.” 50
C.F.R. § 402.02 (emphasis added). The ESA handbook
instructs the Fish and Wildlife Service to determine “whether
the aggregate effects of the factors analyzed under
‘environmental baseline,’ ‘effects of the action,’ and
‘cumulative effects’ in the action area * * * are likely to
jeopardize the continued existence of the species or result in
destruction or adverse modification of critical habitat.” See
United States Fish & Wildlife Serv. & Nat’l Marine Fisheries
Serv., ESA Consultation Handbook, at 4-33 (emphasis
omitted).
In requesting formal consultation from the Fish and
Wildlife Service, the Commission staff identified actions as
part of the relicensing of the Coosa River Project that could
have potential effects on nine listed species and twelve critical
habitat units within the project boundaries, as well as twentyone listed species not occurring within the project boundaries
but that will likely be reintroduced during the term of the new
license.
Biological Opinion at 10–11.
The Opinion
examined five actions: (1) Alabama Power’s Proposal for
Operations, which includes continuation of current operations,
improvements to dissolved oxygen, and implementation of an
Adaptive Management Plan at the Weiss Bypass and Logan
Martin tailrace; (2) implementation of a shoreline management
plan; (3) implementation of a wildlife management plan;
(4) implementation of the Coosa River Project Portion of the
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Alabama Drought Response Operations Proposal; and
(5) drawdown of Lay Lake. Id. at 11–15.
The Opinion purported to identify the environmental
baseline by discussing the status of the species and factors
affecting their environment within the identified action areas.
Biological Opinion at 55–71.
The Opinion did not
“incorporate degraded baseline conditions into its jeopardy
analysis.” National Wildlife Fed’n v. National Marine
Fisheries Serv., 524 F.3d 917, 929 (9th Cir. 2008). The
Opinion stated:
The modifications to the Coosa River and the
construction of [Alabama Power Company’s]
hydro developments began nearly a century
ago * * * and their cumulative effects (e.g.,
fragmented habitats, impeded fish passage,
altered hydrology and water quality) have
undoubtedly changed the landscape in the
Coosa Basin forever, impacting many aquatic
species and likely contributing to the
extirpation and extinction of several.
However, the relicensing of the Coosa Project
at this time cannot take into account the
historic impacts of these actions, but rather
only the current and proposed future
operations and their impacts.
Biological Opinion at 89 (emphasis added). In defining the
environmental baseline, the Opinion reasoned that certain
activities that “began as early as the 1920’s * * * are beyond
the scope of the consultation.” Id. at 58. This exclusion of
the historic impacts on the Coosa River Project appears to be
inconsistent with the guidance in the ESA handbook. The
handbook instructs the Fish and Wildlife Service to determine
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“whether the aggregate effects of the factors analyzed under
‘environmental baseline,’ ‘effects of the action,’ and
‘cumulative effects’ in the action area * * * are likely to
jeopardize the continued existence of the species or result in
destruction or adverse modification of critical habitat.” See
United States Fish & Wildlife Serv. & Nat’l Marine Fisheries
Serv., ESA Consultation Handbook, at 4-33 (emphasis added).
The Biological Opinion itself described certain past harms that
triggered ongoing impacts that must be part of the
environmental baseline.
For example, the Opinion
acknowledged that “the continued impoundment of these
projects results in continual degradation of benthic habitats by
sedimentation, reducing water velocities, changing flow
patterns, and changing water chemistry both above and below
dams.” Biological Opinion at 58 (emphases added). By
discarding the methodology set forth in its own handbook and
its own regulatory definitions, see 50 C.F.R. § 402.02, the Fish
and Wildlife Service acted arbitrarily in establishing the
environmental baseline without considering the degradation to
the environment caused by the Coosa River Project’s operation
and its continuing impacts.
In the Opinion, the Fish and Wildlife Service
acknowledged the precarious state of certain species in the area
and noted that the “[r]easons for the decline and current state”
of those species included “habitat modification,”
“sedimentation,” “eutrophication,” and “other forms of water
quality degradation.” Biological Opinion at 24–54. Rather
than analyze the effects of the continued operation of the Coosa
River Project, the Opinion merely listed some effects and may
have omitted others. Id. at 71–85.
By way of example, the Opinion noted “that depressed
[dissolved oxygen] levels can adversely affect behavior,
growth, feeding, and reproduction in freshwater fishes.”
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Biological Opinion at 75. Likewise, the Opinion noted that
“[f]reshwater mussels, like fish, respond negatively to
depressed [dissolved oxygen] levels.” Id. at 76. The Opinion
notes that “[dissolved oxygen] levels are still well below the
desired levels for a healthy river system” and that it is a “major
concern” that the license imposes no requirement to maintain
dissolved oxygen during “non[-]discharge periods * * *
since * * * the biological needs of fish and mollusks must still
be met when a hydroelectric project is not generating.” Id. at
73–75. The Opinion failed to analyze how the dissolved
oxygen levels are likely to affect the species in the area.
Instead, the Opinion speculates that all will be well “if
A[labama] P[ower] C[ompany] maintain[s] adequate
[dissolved oxygen] levels downstream.” Id. at 76.
While the Opinion at least acknowledged dissolved
oxygen levels as a potential issue, it largely omitted fish
passage and seasonal flows—that is, the effects the lack of fish
passage and minimal flow requirements might have on aquatic
species—from the effects analysis. The Fish and Wildlife
Service argues that to the extent there are issues with fish
passage or seasonal flows, those are part of the environmental
baseline (the historically degraded condition) and remain
unaffected by this action. But, as previously explained, the
Service failed to incorporate the environmental baseline into its
jeopardy analysis. In fact, the Opinion hardly addressed fish
passage and seasonal flows in its discussion of the
environmental baseline. As the Ninth Circuit has explained,
“even where baseline conditions already jeopardize a species,
an agency may not take action that deepens the jeopardy by
causing additional harm.” National Wildlife Fed’n, 524 F.3d
at 930. Under these circumstances, the Opinion’s jeopardy
analysis is arbitrary because it fails to account for effects of
degraded conditions on threatened species.
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The Department of Interior defends the Opinion’s
jeopardy analysis by arguing that “the populations found inside
the action area have been living under degraded baseline
conditions since at least 1964, and this licensing action
proposes to improve those conditions by, among other things,
imposing a minimum-flow regime for the Weiss bypass for the
first time.” DOI Br. at 21. But attributing ongoing project
impacts to the “baseline” and excluding those impacts from the
jeopardy analysis does not provide an adequate jeopardy
analysis. The Opinion’s jeopardy analysis is arbitrary in
failing to account for the impact of continued operations of the
existing dams.
Also, the Service’s Opinion failed to show a rational
connection between the facts found and its conclusion that the
Coosa River Project will not jeopardize listed species or
adversely modify critical habitat. The Opinion’s Incidental
Take Statement estimates that ninety or one hundred percent of
several species in particular sections will be taken. Biological
Opinion at 90–93. For example, the Opinion predicted that
the southern clubshell, finelined pocketbook, southern pigtoe,
and Georgia pigtoe could be taken up to one hundred percent
as a result of poor water quality conditions in a new flow
regime near the Weiss Bypass. Id. at 90–91. Likewise, the
Opinion predicted that one hundred percent of the tulotoma
snail, painted rocksnail, and southern clubshell could be taken
in the Logan Martin Dam section of the Coosa River based on
the continued operation of that dam. Id. at 91. Despite these
predictions, the Opinion concluded that “this level of expected
take is not likely to result in jeopardy to any of the listed species
or destruction or adverse modification of critical habitat.” Id.
at 94. At the least, the Opinion should explain how a one
hundred percent incidental take for multiple species is not
likely to result in jeopardy.
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In its briefing before this Court, the Department of Interior
argues that the one hundred percent take only refers to
individual members of the species in a specific location.
Given its absence from the Opinion, this argument appears to
be a post-hoc litigation position. The Opinion never suggests
as a basis for its finding of no jeopardy that the local
populations are insignificant to the larger populations. See
Biological Opinion at 90–93. Accordingly, the Opinion’s
jeopardy analysis is not legally sufficient without further
explanation from the Fish and Wildlife Service, especially
because population distribution is one of the factors the Service
had to consider when evaluating the overall health of the
species. See 50 C.F.R. § 402.02 (defining “jeopardize” as to
“reduce appreciably the likelihood of both the survival and
recovery of a listed species in the wild by reducing the
reproduction, numbers, or distribution of that species”)
(emphasis added).
Finally, the Opinion’s Incidental Take Statement is also
legally insufficient. It failed to include an adequate trigger for
re-consultation. Whenever an Opinion determines that “take
is reasonably certain to occur,” the Opinion must provide an
“Incidental Take Statement,” which authorizes harm to an
endangered species and includes a trigger for re-consultation.
50 C.F.R. § 402.14(g)(7), (i)(1)(i), (i)(4). The Conservation
Groups object that the Incidental Take Statement failed to
provide a numerical trigger or identify a surrogate that provides
a reasonable estimate for when to trigger reinitiation of formal
consultation. The Department of Interior acknowledges that
the Opinion did not provide a numerical trigger for certain
species, but argues that it provided clear surrogate triggers for
reinitiation of consultation.
The Incidental Take Statement’s reinitiation notice merely
provides that reinitiation should occur if “the amount or extent
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of incidental take is exceeded.” Biological Opinion at 99.
But this statement does not provide enough guidance to explain
how to determine whether “the amount or extent of incidental
take is exceeded,” particularly because incidental take is one
hundred percent for multiple species. At oral argument, the
Department argued that for those areas where it identified one
hundred percent take, there would be no reason to reinitiate
consultation because the take cannot exceed one hundred
percent.
Oral Argument at 1:16:55–1:17:02.
The
Department argued that if there ended up being a higher
percentage of harm than predicted, however, reinitiation of
consultation would be required. Id. at 1:17:40–1:17:48. But
the Department admitted that it would not be able to detect take
for certain species. Id. at 1:18:28–1:18:52. As a result, the
Department acknowledged that the reinitiation notice in the
Opinion was only included to meet Fish and Wildlife Service’s
regulatory obligations. Id. at 1:18:54–1:19:03.
The
requirement to include a trigger for reinitiation of consultation
necessitates more than lip service. The lack of a clear trigger
point to reinitiate consultation renders the Opinion unlawful.
B
The Conservation Groups’ NEPA challenge turns on the
sufficiency of the Commission’s decision that relicensing the
Coosa River Project for thirty years would not have any
significant environmental effects on the vulnerable Coosa
River ecological system. Because the record of the licensing
proceedings points strongly in the opposite direction, the
Commission’s decision to forgo an Environmental Impact
Statement does not hold water.
NEPA’s primary function is “information-forcing,” Sierra
Club v. FERC, 867 F.3d 1357, 1367 (D.C. Cir. 2017),
compelling federal agencies to take a hard and honest look at
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the environmental consequences of their decisions, Mayo v.
Reynolds, 875 F.3d 11, 16 (D.C. Cir. 2017). See also Vermont
Yankee Nuclear Power Corp. v. Natural Res. Def. Council,
Inc., 435 U.S. 519, 558 (1978). In particular, to ensure that
agency decisionmaking is fully environmentally informed,
NEPA requires the agency to (1) identify accurately the
relevant environmental concerns, (2) take a hard look at the
problem in preparing its Environmental Assessment, (3) make
a convincing case for any finding of no significant impact, and
(4) show why, if there is an impact of true significance, there
are sufficient changes or safeguards in the project to reduce the
impact to a minimum, which would obviate the need for an
Environmental Impact Statement entirely. Sierra Club v. Van
Antwerp, 661 F.3d 1147, 1153–1154 (D.C. Cir. 2011), as
amended (Jan. 30, 2012). Under that test, the Commission’s
Assessment will pass muster only if it undertook a “wellconsidered” and “fully informed” analysis of the relevant
issues and opposing viewpoints. Myersville Citizens for a
Rural Cmty., Inc. v. FERC, 783 F.3d 1301, 1324–1325 (D.C.
Cir. 2015).
While determining whether an agency’s “hard look” was
adequate can often be an imprecise exercise, two fatal flaws in
the Commission’s analysis make the decision in this case quite
straightforward. First, the Commission failed to reasonably
consider and address multiple indicators that the project could
have a significant impact on the environment, including the
types of substantial effects on fish passage and dissolved
oxygen levels that would normally compel the preparation of
an Environmental Impact Statement.
Second, the
Commission misanalyzed the cumulative environmental
effects of the Coosa River Project.
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1. Significant Environmental Impact
NEPA requires an Environmental Impact Statement for any
major federal action that might “significantly” affect the human
environment. 42 U.S.C. § 4332(C); see Sierra Club v.
Peterson, 717 F.2d 1409, 1415 (D.C. Cir. 1983) (“If any
‘significant’ environmental impacts might result from the
proposed agency action then an [Environmental Impact
Statement] must be prepared before the action is taken.”).
Evaluating an action’s environmental “significance” requires
analyzing both the context in which the action would take place
and the intensity of its impact. 40 C.F.R. § 1508.27.
Considering context is critical because the significance of
an action can vary based on the setting and surrounding
circumstances. For the type of site-specific action at issue in
this case, significance typically depends on the action’s effects
in the immediate locale, rather than in the broader ecosystem
or world as a whole. 40 C.F.R. § 1508.27(a). Both short- and
long-term effects must be addressed. Id.
“Intensity” refers to the “severity” or acuteness of the
impact on the contextualized environment.
40 C.F.R.
§ 1508.27(b). NEPA’s implementing regulations prescribe a
number of relevant factors that ensure the analysis of intensity
rests on a comprehensive survey of the views of all affected
governmental entities. See id. The NEPA analysis must take
into account all foreseen impacts, both beneficial and adverse
(regardless of whether the agency believes the action will
provide a net benefit). Id. § 1508.27(b)(1). The agency must
also consider the unique characteristics of the geographic area,
the cumulative effects of each individual part of the action, and
any impact on endangered or threatened species or their
habitats. Id. § 1508.27(b)(3), (7), (9).
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a. Fish Passage
The Commission’s NEPA analysis backhanded the
significant and deadly impact that the Project’s operation
threatens for indigenous fish populations as they attempt to
navigate through the affected waterways. The Commission
acknowledged that the project would result in large mortality
rates for a number of species entrained (that is, killed) by
Project turbines—as many as 1.3 million fish per year.
Environmental Assessment at 101–102. The Commission,
however, just shrugged off that death rate, deeming it
insignificant because the entrained fish likely would be nonprotected species or juveniles with high natural mortality rates.
The Commission’s Assessment then pointed out that the
Project’s reservoirs support robust sport and in some cases
commercial fisheries, and they do not appear to be substantially
affected by any turbine-related mortality. Id.
That analysis is rife with flaws. First, the Commission’s
only cited evidence for the amount of fish deaths was a morethan-decade-old-survey of fish entrainment studies and
estimates provided by the license applicant itself, Alabama
Power. No updated information was collected; no field
studies were conducted.
Nor was any independent
verification of Alabama Power’s estimates undertaken.
Assuming Alabama Power’s good faith, its estimates were
entirely unmoored from any empirical, scientific, or otherwise
verifiable study or source. The Commission also failed to take
even the preliminary step of attempting to acquire recent or
site-specific data against which Alabama Power’s estimates
could have been compared. The Commission’s acceptance,
hook, line, and sinker, of Alabama Power’s outdated estimates,
without any interrogation or verification of those numbers is,
in a word, fishy. And it is certainly unreasoned.
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The Commission points out that it reviewed a 1997
“summary of fish entrainment studies” to ground its findings
and to cross-check Alabama Power’s estimates.
Environmental Assessment at 102. But that then-twelve-yearold study did nothing more than “review[] the results of 43 fish
entrainment studies conducted at hydroelectric projects”
located in completely different regions of the United States.
Id. (explaining that the summary reviewed other studies
conducted in the early- to mid-1990s at hydroelectric projects
located primarily in the Northeast, Southeast, and Midwest).
An old review of even older and geographically remote
projects is far too thin a reed on which to rest a conclusion that
annually killing 11% of a fish population is of no
environmental significance.
Second, NEPA demands far more analytical rigor than the
Assessment’s breezy dismissal of the high fish mortality rate
documented in its dated and unverified studies.
See
Myersville, 783 F.3d at 1322 (agencies cannot overlook a
single environmental consequence if it is even “arguably
significant”); Delaware Riverkeeper Network v. FERC, 753
F.3d 1304, 1310 (D.C. Cir. 2014) (agencies must comply with
NEPA’s exacting procedural requirements to “the fullest extent
possible”). By way of excuse, the Commission’s Assessment
noted, almost in passing, that the entrained fish are of the sort
that normally “experience high natural mortality in fish
populations unaffected by hydro operations.” Environmental
Assessment at 102.
The Commission seems to assume that this is a substantive
answer, as though the Venn diagram of fish killed through
entrainment and natural attrition is a perfect circle. Not so.
The Project would compound the death rate. Those fish that
manage to run the gauntlet of youth and natural mortality
factors will now emerge only to face a high rate of death in
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hydropower turbines and other lethal aspects of the Project.
The Commission’s NEPA analysis has to grapple with that.
Third, the Commission’s cheery assurance that “excellent”
human-operated sport and commercial fisheries remain
downstream is just whistling past the graveyard.
Environmental Assessment at 97, 99. The Commission, for its
part, made no effort to explain how downstream, humanoperated sport and commercial fisheries are relevant
bellwethers for environmental impacts in the upstream Coosa
River. After all, the nearby presence of a nice zoo has never
been a relevant answer under NEPA to high species mortality
in nature.
In short, with respect to the admitted killing of large
numbers of fish in the Coosa River, the Commission’s NEPA
analysis was woefully light on reliable data and reasoned
analysis and heavy on unsubstantiated inferences and non
sequiturs. The record simply does not provide a rational
connection between the licensing decision, the record
evidence, and the finding of no significant environmental
impact. Much more work is required of the Commission.
Courts, after all, cannot evaluate the reasonableness of the
unexplained.
b. Failure to Maintain Dissolved Oxygen Levels
Dissolved oxygen in the water is indispensable for aquatic
animal life. Many of the aquatic species in the Coosa River
Project area, including those listed as endangered or threatened
under the Endangered Species Act, require well-oxygenated,
flowing water to survive. As a general rule, dissolved oxygen
levels can threaten “acute mortality” for many aquatic species
if they fall below 4.0mg/L for any sustained period of time.
First Rehearing Order at P 38. The Project’s operations can
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lead to low dissolved oxygen levels, especially in the warmer
summer and early fall months, because streamflows decline,
and large portions of tributary flows are captured and held in
the reservoirs to maintain desired elevations. Id. at PP 19–22.
Also during the summer, water in the Project’s reservoirs tends
to separate into two layers: (1) a warm surface layer that is
relatively rich in dissolved oxygen due to its proximity to the
surface, which facilitates oxygen exchange with the ambient
air, and (2) a colder bottom layer where decomposing organic
material in the reservoir bed devours the dissolved oxygen,
drastically reducing the level remaining to support life.
Dissolved oxygen levels in the tailraces—the waters
downstream of the dams—are primarily influenced by the
depth at which water is drawn from the reservoir during
generation. First Rehearing Order at P 19 n.19. The
Project’s intakes primarily draw water from the deeper portions
of their respective impoundments. The release of these waters
with low levels of dissolved oxygen through the Project
powerhouses can suppress dissolved oxygen levels in the
Project’s tailraces to well below the 4.0mg/L standard up to
twenty percent of the time during warmer months.
Federal law prohibits the Commission from licensing a
hydroelectric project unless the state water quality agency
certifies the project’s compliance with state water standards.
See 33 U.S.C. § 1341(a)(1), (d). The Alabama Department of
Environmental Management conditioned its approval of the
Coosa River Project on Alabama Power’s compliance with
several state-law requirements, and those conditions were
incorporated into the license the Commission issued.
As relevant here, the first condition initially required
Alabama Power to ensure that the dissolved oxygen level at
each of its seven developments remained above 4.0 milligrams
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per liter. That requirement gave effect to the plain text of
Alabama law. Ala. Admin. Code rr. 335-6-10-.09(2)(e)(4)(i),
(3)(c)(4)(i), (5)(e)(4)(i) (“In no event shall the dissolved
oxygen level be less than 4 mg/l due to discharges from
existing hydroelectric generation impoundments.”) (emphasis
added).
Given that “clear” state-law command, the
Commission’s Licensing Order was explicit that “Alabama
Power must maintain no less than 4.0 mg/L of [dissolved
oxygen] at all times, including during periods of nongeneration.” Licensing Order at P 73 n.47 (emphasis in
original). 2
But on rehearing, the Commission muddied the waters by
“clarify[ing],” First Rehearing Order at P 56, that the duty to
maintain dissolved oxygen levels “at all times” actually meant
only sometimes—that is, only during actual generation and
certain minimum flow releases, id. at P 27 (Alabama Power
only needs “to meet a 4.0 mg/L [dissolved oxygen] standard
when the Project is discharging, i.e., during periods of
generation and in its minimum flow releases from the Weiss
and Jordan developments.”). In reaching that conclusion, the
Commission noted that the Alabama Department of
Environmental Management interpreted the state code to
mandate 4.0 mg/L dissolved oxygen levels only during periods
2
Alabama law actually sets a lower dissolved oxygen water
quality standard for hydropower generators than for other users of
“outstanding Alabama water.” Ala. Admin. Code rr. 335-6-10.09(1). In response to a public comment concerning this variance
for hydropower sources, Alabama interpreted its Code provision to
“mean that during periods when there is no discharge from the
impoundment the applicable dissolved oxygen criterion is 5.0 mg/l
in waters with the Public Water Supply and Fish and Wildlife
designated uses. The applicable dissolved oxygen criterion during
periods when the impoundment is discharging is 4.0 mg/l.” J.A.
1355.
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of actual generation. Id. at PP 26–27. The Commission also
accepted Alabama Power’s submissions that it would be
infeasible to maintain 4.0 mg/L dissolved oxygen minimums at
all times even if various mitigation measures identified by
Commission staff were implemented. Id. at PP 44–46.
The Commission’s authorization for Alabama Power to
operate for substantial periods of time without maintaining the
lowest level of dissolved oxygen identified in the text of
Alabama’s statute and necessary to avoid “acute mortality,”
First Rehearing Order at P 38, constituted a significant adverse
environmental consequence without reasoned justification.
As the Commission acknowledged at oral argument, nongeneration periods constitute the “overwhelming majority” of
time for the project. Oral Argument at 1:10:24–1:10:56.
What is more, the record documented an extensive and
troubling pattern during which dissolved oxygen levels in the
Project area frequently plummeted below the lowest tolerable
level, threatening “acute mortality” for many aquatic species.
First Rehearing Order at P 38. A comprehensive analysis of
the Project’s dissolved oxygen levels for much of 1999–2014
revealed that hourly dissolved oxygen levels during generation
periods fell below the minimum 4.0mg/L standard more than
25% of the time across all Coosa developments.
For example, in 2014, records revealed that, at numerous
Alabama Power sites, dissolved oxygen levels routinely
dropped below 4.0 mg/L in the warmer months, at the
following frequency: 13.6% of generation time at H. Neely
Henry, 10.2% at Weiss, 5.8% at Logan Martin, and 1.2% at
Mitchell. First Rehearing Order at P 32.
Mean daily levels of dissolved oxygen during nongeneration periods—exactly what the Commission
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greenlighted—were far worse. The percentage of nongeneration time when dissolved oxygen dropped below 4.0
mg/L was: 57.8% at Logan Martin, 50.4% at Lay, 37.1% at
H. Neely Henry, 11.5% at Mitchell, and less than 1% at Weiss.
First Rehearing Order at P 33.
To put a finer point on it, the Commission’s own licensing
record establishes that the Coosa River Project regularly and
predictably violates the water quality license conditions during
generation periods and blows right past the water-quality
standard codified in Alabama law during times of nongeneration, threatening lethal consequences for water species.
Indeed, in 2005, the Fish and Wildlife Service expressed its
“very serious concerns” to the Alabama Department of
Environmental Management about “repeated non-compliance
with state water quality standards (pursuant to section 40l of
the Clean Water Act) by [Alabama Power]’s facilities subject
to this relicensing as well as inconsistent data reporting[.]”
J.A. 635. Yet the Commission took no account of the
environmental impact of these deadly low levels of dissolved
oxygen in its NEPA analysis.
Instead, the Commission hangs its hat on the license’s
requirement that Alabama Power install oxygen diffuser
aeration systems. These aeration systems are generally
designed to pump additional oxygen into the water during
generation periods. That sounds like a promising approach.
At least, if the aspiration were matched with substance. But it
is not on this administrative record. The licensing record is
devoid of information about what aeration system will be
implemented, or when, or how it will perform. Alabama
Power never provided any details or specifications about its
proposed aeration system before the Commission reflexively
embraced it as a sufficient mitigation measure. On top of that,
the Commission allowed Alabama Power an additional six
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months after the license issued before even disclosing its
anticipated aeration measures to the Commission and another
year to put them in place. The Commission also gave
Alabama Power another six months from license issuance to
file its proposals for water quality monitoring enhancements,
so that they too could—hopefully—be implemented within
eighteen months of licensing.
Also curiously absent from the Commission’s analysis is
what would happen to the water if the proposed aeration system
or other mitigation measures fell short and were disapproved
by the Commission. That was a distinct possibility given that
the Commission had already found that two of Alabama
Power’s existing aeration systems failed to meet the 4.0 mg/L
bare minimum at the time of relicensing. See First Rehearing
Order at PP 29–35. And the Commission ignored altogether
the impact on the Coosa River habitat and aquatic life of at least
eighteen months of dangerously depleted dissolved oxygen
levels across almost the entire Project.
Because Alabama Power gave the Commission nothing in
this record to support its judgment, the Commission pointed in
its First Rehearing Order to an aeration system apparently
being used at the Yadkin-Pee-Dee Project in North Carolina to
maintain appropriate dissolved oxygen levels. That hurts
rather than helps. Remember, by the time the Commission
issued its First Rehearing Order, three years had elapsed from
the licensing decision. If Alabama Power had been timely
implementing the aeration systems as promised in the
Licensing Order, the Commission would have had no need to
look to an unrelated project in North Carolina to prop up its
decision. Plus, if the Commission was aware of a successful
aeration system available for Alabama Power to use, then it
should have required that Alabama Power use that system or
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its equivalent rather than give the Company an 18-month (or
perhaps now three-year) blank check.
What is more, the administrative record does nothing to
back-up the Commission’s reliance on Yadkin-Pee-Dee. The
record is devoid of evidence or data indicating that whatever
aeration system used there would have the same results in the
Coosa River given the configuration of its hydroelectric
systems and already-fragile and degraded conditions. Also
missing is any analysis of how long the dissolved oxygen levels
persist before dissipation, the conditions under which the
aeration system performed in North Carolina, or even evidence
that the proffered levels of dissolved oxygen actually ever
materialized at Yadkin-Pee-Dee.
The Commission just
blithely assumed that (i) a buffer level of 6.0 mg/L of dissolved
oxygen would be consistently attained, and (ii) it would be
enduring enough to perpetuate at least the minimum 4.0 mg/L
throughout the entire non-generating period. First Rehearing
Order at P 51.
To sum up, the Commission relicensed the Coosa Project
despite known violations of minimum dissolved oxygen levels
based on its sight-unseen acceptance of Alabama Power’s
anticipated-but-unidentified mitigation measures, the specifics
of which did not even have to be submitted for examination
until six months after the license issued, or installed for
eighteen months. See Environmental Assessment at 222–223.
Given the exceptional importance of maintaining minimum
dissolved oxygen levels to the aquatic ecosystem, it was
irrational for the Commission to cast those significant
environmental impacts aside in reliance on some sort of
mitigation measures, which the Commission was content to
leave as “TBD.”
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2. Consideration of Cumulative Impacts
NEPA requires that the agency’s Environmental
Assessment wrestle with the cumulative environmental impact
of a proposed action. Implementing regulations prohibit
agencies from gaming the system by artificially segmenting
significant actions into piecemeal, and individually
insignificant, components.
See 40 C.F.R. § 1508.7.
Cumulative impacts are “the incremental impact of the action
[on the environment] when added to other past, present, and
reasonably foreseeable future actions regardless of what
agency (Federal or non-Federal) or person undertakes such
other actions.” Id. As the NEPA regulations explain,
cumulative impacts include “individually minor but
collectively significant actions” that occur over a length of
time. Id. Effects include both direct effects that “are caused
by the action and occur at the same time and place,” and
indirect effects that the action foreseeably causes, but that are
removed from the action in time and location. 40 C.F.R.
§ 1508.8.
Put simply, an agency’s Environmental Assessment “must
give a realistic evaluation of the total impacts and cannot
isolate a proposed project, viewing it in a vacuum.” Grand
Canyon Trust v. FAA, 290 F.3d 339, 342 (D.C. Cir. 2002). In
so doing, the “incremental impact of the action [at issue] must
be considered when added to other past, present, and
reasonably foreseeable future actions.” Id. (alteration in
original; internal quotation marks omitted). In other words,
“[i]t makes sense to consider the ‘incremental impact’ of a
project for possible cumulative effects by incorporating the
effects of other projects into the background data base of the
project at issue.” Coalition on Sensible Transp., Inc. v. Dole,
826 F.2d 60, 70–71 (D.C. Cir. 1987) (internal quotation marks
omitted). Indeed, the Commission agreed that the NEPA
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cumulative-effects analysis had to account for all past impacts
of the dams’ construction and operation, including the enduring
or ongoing effects of past actions.
The Conservation Groups’ challenge to the Commission’s
cumulative impact analysis under NEPA largely mirrors their
objections to the Fish and Wildlife Service’s Biological
Opinion. See supra Section III.A. That makes sense because
the Environmental Assessment itself relies heavily on the
Service’s Biological Opinion in establishing the current
operation of the Coosa Project as the baseline for measuring
environmental impacts. Licensing Order at P 100. As a
result, the Service’s failure to factor the damage already
wrought by the construction of dams into the cumulative
impacts analysis fatally infected this aspect of the
Commission’s NEPA decision as well. The Commission gave
scant attention to those past actions that had led to and were
perpetuating the Coosa River’s heavily damaged and fragile
ecosystem. Nor did it offer any substantive analysis of how
the present impacts of those past actions would combine and
interact with the added impacts of the 30-year licensing
decision. The Commission’s cumulative impact analysis left
out critical parts of the equation and, as a result, fell far short
of the NEPA mark.
C
Finally, we note that in this case, the question of whether
the Commission complied with its statutory obligations under
the Federal Power Act’s licensing provisions is subsumed by
questions concerning its compliance with countervailing
statutory restrictions imposed by NEPA and ESA. The
propriety of the Commission’s decision under the Federal
Power Act, on these facts, thus stands or falls on the merits of
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the NEPA and ESA inquiries. In light of the foregoing, it must
fall.
*****
For the foregoing reasons, we dismiss the first petition for
review, and grant the second petition for review on the ground
that the Service’s Biological Opinion, adopted by the
Commission, and the Commission’s Environmental
Assessment under NEPA were arbitrary and capricious,
insufficiently reasoned, and unsupported by substantial
evidence. Because those errors fatally infected the Licensing
Order, the Commission’s decision renewing Alabama Power’s
license for thirty years also violated the Commission’s
obligations under Sections 797 and 803 of the Federal Power
Act. We accordingly vacate the licensing decision, and
remand to the agency for further proceedings.
So ordered.
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