24 Cal. App. 5th 476
Cal. Ct. App. 5th2018Background
- PG&E operates Diablo Canyon nuclear plant using once-through seawater cooling structures located on state-owned submerged/tidal lands leased from the California State Lands Commission (the Commission); original 49-year leases were expiring in 2018–2019.
- PG&E applied for a consolidated replacement lease to run coterminously with its federal licenses (through 2024–2025); the Commission approved a limited-term lease without preparing an EIR under CEQA.
- The Commission concluded the lease renewal fit the CEQA "existing facilities" categorical exemption (Guidelines §15301) and that the "unusual circumstances" exception (Guidelines §15300.2(c)) did not apply; it also conducted a public-trust analysis and found no substantial impairment.
- World Business Academy (WBA) petitioned for writ/ declaratory relief arguing (1) CEQA required an EIR because the exemption did not apply and/or the unusual circumstances exception did, and (2) the lease violated the public trust doctrine; the trial court denied relief and this appeal followed.
- The appellate court reviewed the Commission’s decision for prejudicial abuse of discretion and substantial-evidence support and affirmed: exemption applied, unusual-circumstances exception did not, and public-trust analysis was adequate.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Applicability of CEQA existing-facilities categorical exemption (§15301) to lease renewal | WBA: nuclear plant not encompassed by exemption; categorical exemptions shouldn’t cover facilities with significant environmental effects | Commission/PG&E: plant is an existing investor-owned utility facility providing power; lease renews existing use with negligible/no expansion | Court: exemption applies; existing facilities language reasonably includes power-generating utilities and record supports negligible/no expansion |
| Unusual-circumstances exception (whether exception bars exemption) | WBA: multiple unusual circumstances (size, coastal location, marine mortality, health data, seismic risk, embrittlement, spent fuel, terrorism) create reasonable possibility of significant environmental effect | Commission/PG&E: evidence shows these conditions are part of baseline or are unrelated to lease renewal; no substantial evidence that renewal increases risks | Court: assuming arguendo some circumstances were unusual, the Commission properly applied the "fair argument" standard and substantial evidence fails to show a reasonable possibility lease renewal would cause significant environmental impacts |
| Baseline and scope of CEQA review (whether continuing operations baseline was improper) | WBA: baseline should account for cumulative/future risks and increasing harms over seven-year term; renewal is not mere continuation | Commission/PG&E: baseline is existing conditions at time of decision; continuation without change typically has no cognizable CEQA impact | Court: baseline properly was current operating conditions; continued unchanged operation is part of baseline and does not, by itself, trigger an EIR |
| Public trust doctrine (whether Commission violated public trust by approving lease) | WBA: Commission failed to do required factual evaluation and ignored cumulative impacts affecting navigation, fisheries, habitat | Commission/PG&E: staff report analyzed public-trust interests, relevant regulations (e.g., once-through cooling policy), and balanced uses; no substantial interference found | Court: Commission’s public-trust analysis was supported by evidence and not arbitrary or capricious; no error found |
Key Cases Cited
- Tomlinson v. County of Alameda, 54 Cal.4th 281 (2012) (CEQA EIR requirement and project definition)
- Berkeley Hillside Preservation v. City of Berkeley, 60 Cal.4th 1086 (2015) (unusual-circumstances exception and fair-argument standard)
- North Coast Rivers Alliance v. Westlands Water District, 227 Cal.App.4th 832 (2014) (renewal of longstanding water contracts; baseline and renewal-as-baseline analysis)
- Citizens for East Shore Parks v. California State Lands Com., 202 Cal.App.4th 549 (2011) (public trust doctrine and Commission obligations)
- Muzzy Ranch Co. v. Solano County Airport Land Use Commission, 41 Cal.4th 374 (2007) (factual evaluation for categorical exemptions)
- Davidon Homes v. City of San Jose, 54 Cal.App.4th 106 (1997) (standard of review for agency exemption determinations)
- Bloom v. McGurk, 26 Cal.App.4th 1307 (1994) (permit renewals and existing-operations baseline)
- Carmel River v. Monterey Peninsula Water Management Dist., 141 Cal.App.4th 677 (2006) (limits on applying categorical exemptions and consideration of cumulative/related projects)
- Walters v. City of Redondo Beach, 1 Cal.App.5th 809 (2016) (review standard for agency CEQA decisions)
- San Francisco Baykeeper, Inc. v. California State Lands Commission, 242 Cal.App.4th 202 (2015) (public trust review scope and discretion)