56 F.4th 45
D.C. Cir.2022Background
- Constellation (Conowingo Dam operator) applied to FERC for a federal license; under Clean Water Act §401(a)(1) it first needed Maryland’s water-quality certification.
- In 2018 Maryland issued a §401 certification imposing extensive conditions (nutrient controls, fish passage, monitoring, flow changes, trash control).
- Constellation challenged that certification administratively and in court; the parties entered mediation and reached a settlement.
- The settlement provided that Maryland would “conditionally waive” any §401 rights if FERC incorporated the settlement’s proposed license articles; FERC adopted the articles and concluded Maryland had waived its §401 authority.
- Environmental groups (Waterkeepers) challenged FERC’s license, arguing §401(a)(1) allows waiver only by the state’s failure or refusal to act and not by retroactive settlement waiver.
- The D.C. Circuit held FERC exceeded its statutory authority, vacated the Conowingo license, and remanded for proceedings consistent with the opinion.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a State may retroactively waive an issued §401 certification via settlement | Maryland (and petitioners supporting challenge) — a state that has issued a certification has acted; it cannot later waive that certification under §401(a)(1) | FERC/Constellation — nothing in the CWA prohibits a state from affirmatively waiving §401 authority during appeal or by settlement | Court: §401(a)(1) permits waiver only by the state’s failure or refusal to act; retroactive settlement waiver is not authorized |
| Whether FERC could lawfully issue a license based on Maryland’s conditional waiver in the settlement | Waterkeepers — FERC lacked authority because Maryland had acted by issuing the 2018 certification and no statutory waiver occurred | FERC — the settlement created a valid waiver that satisfied §401(a)(1), so FERC could issue the license | Court: FERC lacked statutory authority to issue the license on that basis; the license is vacated |
| Whether the court must defer to FERC’s interpretation of §401 | N/A (petitioners argued statutory text controls) | FERC sought deference, treating the absence of an express prohibition as permissive | Court: No deference; review de novo because EPA, not FERC, administers the CWA |
| Appropriate remedy — vacatur vs. remand without vacatur | Waterkeepers — vacatur appropriate to vindicate statutory scheme and complete review | FERC — urged remand without vacatur to avoid disruptive consequences | Court: Vacatur is appropriate; disruptive effects can be addressed by interim/annual licenses; remand for further proceedings |
Key Cases Cited
- Keating v. FERC, 927 F.2d 616 (D.C. Cir. 1991) (states are the primary enforcers under the Clean Water Act; state primacy in water-quality standards)
- Department of the Interior v. FERC, 952 F.2d 538 (D.C. Cir. 1992) (FERC may not alter or reject state-imposed §401 conditions)
- Turlock Irrigation Dist. v. FERC, 36 F.4th 1179 (D.C. Cir. 2022) (each time a state grants or denies a certification it has "acted" under §401(a)(1))
- Southern California Edison Co. v. FERC, 195 F.3d 17 (D.C. Cir. 1999) (absence of express proscription in a statute does not permit agencies to ignore limiting statutory language)
- Alcoa Power Generating Inc. v. FERC, 643 F.3d 963 (D.C. Cir. 2011) (FERC’s interpretations of the CWA are not entitled to deference because EPA administers the Act)
- Allied-Signal, Inc. v. Nuclear Regulatory Comm’n, 988 F.2d 146 (D.C. Cir. 1993) (framework for deciding vacatur versus remand without vacatur)
- Allina Health Servs. v. Sebelius, 746 F.3d 1102 (D.C. Cir. 2014) (vacatur is the normal remedy for unsustainable agency action)