Kevin Bell James H. Weaver Lloyd K. Marbet Utility Reform Project, Alcoa Inc., Intervenor v. Bonneville Power Administration, Goldendale Aluminum, and Northwest Aluminum Company, Inc. Columbia Falls Aluminum Company, Respondent-Intervenor. Kevin Bell James H. Weaver Lloyd K. Marbet Utility Reform Project, Alcoa Inc., Intervenor v. Bonneville Power Administration, Columbia Falls Aluminum Company, Inc. Golden Northwest Aluminum, Inc., Respondent-IntervenorKevin Bell James H. Weaver Lloyd K. Marbet Utility Reform Project, Alcoa Inc., Intervenor v. Bonneville Power Administration, Goldendale Aluminum, and Northwest Aluminum Company, Inc. Columbia Falls Aluminum Company, Respondent-Intervenor. Kevin Bell James H. Weaver Lloyd K. Marbet Utility Reform Project, Alcoa Inc., Intervenor v. Bonneville Power Administration, Columbia Falls Aluminum Company, Inc. Golden Northwest Aluminum, Inc., Respondent-Intervenor
David J. Adler, Special Asst. U.S. Attorney and Thomas C. Lee, Asst. U.S. Attorney (appearing only), Portland, Oregon, for the respondent.
Paul M. Murphy, Murphy & Buchal, Portland, Oregon, for the joint intervenor-respondents.
William H. Walters, Miller Nash LLP, Portland, Oregon, for the nonaligned intervenor.
On Petition for Review of an Order of the Bonneville Power Administration.
OPINION
WALLACE, Senior Circuit Judge.
In these consolidated actions, Petitioners Utility Reform Project and its members Bell, Weaver, and Marbet (collectively, Bell) seek review of power sale contract amendments between Bonneville Power Administration (BPA) and several direct service industries. Except as otherwise explained, we have jurisdiction over Bell‘s timely filed petition under
I.
BPA is a federal agency designated as the marketing authority for almost all electric power generated in federal facilities in the Pacific Northwest.
A subsequent energy crisis created a low power supply and high prices in the spot market, where BPA ultimately buys its power. The price of the power to BPA skyrocketed, but the price of power to DSIs remained at the low contract rates. The result was a financial disaster: a contractual obligation to buy high and sell low. In response, BPA developed a load reduction program: conservation by consumers, reduction in power demand by utilities, and load curtailment by DSIs. BPA accomplished thе load curtailment program by paying the DSIs to agree to amend the contracts so that BPA would be excused from its contractual obligations to supply power to the DSIs at the contract rate. The plan was an astounding success.
Bell challenges these сurtailment amendments, contending that (1) BPA exceeded its statutory authority, (2) BPA‘s decision was arbitrary, capricious, and unsupported by substantial evidence, (3) BPA failed to comply with the ratemaking procedures of
Our power of review is limited. We may set aside BPA‘s decision only if it is “arbitrary, capricious, an abuse of discretion or otherwise not in accordance with law.”
Bell seeks review of the amendment to contract number 01PB-10786. Notwithstanding Bell‘s assertions to the contrary, this agreement was executed in February, 2001. The petition for review was filed six months later, far beyond the Northwest Power Act‘s ninety-day time limitation.
II.
Bell argues that BPA exceeded its statutory authority by executing the curtailment amendments. Conceding that BPA has statutory delegation to buy and sell power,
III.
Bell next argues that BPA‘s decision was arbitrary and capricious because the DSIs would “likely” have shut down or independently curtailed their power purchases even absent the curtailment amendments. Bell‘s guess is his business risk assessment that the curtailmеnt provisions were unnecessary. Few contracts entail no business risk. BPA‘s decision to amend its contract obligations was eminently businesslike, given the probably devastating result of performing the original contract, the significant risk that the DSIs would not independently curtail their powеr purchases, and the program‘s smashing success. We will not second-guess the wisdom of BPA‘s winning business decisions, especially when it was responding to unprecedented market changes. See APAC, 126 F.3d at 1171 (also refusing to second-guess BPA‘s business decisions under a more searching standard of review). The decision was not arbitrary or capricious.
IV.
Bell also argues that the curtailment amendments essentially created a discount by lowering the original contract price for power. See Bonneville Power Admin. Proc. § 1010.2(j), 51 Fed. Reg. 7611-01, 7615 (1986) (defining “rate” as including “discount“); APAC, 126 F.3d at 1176-77 (upholding BPA‘s definition of “rate“). Bеll argues that the ratemaking procedures of the Regional Act § 7(i),
Bell urges that the curtailment amendments were roundabout discounts because the money paid to the DSIs was inextricably linked with the rate so as to modify the original price. We have not yet accеpted this “inextricably linked” theory since BPA‘s 1986 definition of “rate.” See Cal. Energy, 754 F.2d at 1474 (blessing the “inextricably linked” theory, but decided before BPA‘s definition of “rate“);
First, the transactions were separate in time. The curtailment agreеments were executed seven or eight months after the original sale contract. Second, the transactions were separate in environment. The power market landscape changed dramatically during the interim months.
Third, and most important, the transactions were separate in consideration. If the contract amendment was a discount, we would expect that BPA gets too little or nothing in return for the money it gives to the DSIs (besides the previous sale of power). For instance, in California Energy, we concluded that BPA made a roundabout disсount when it bought worthless scheduling rights. 754 F.2d at 1474. Here, however, BPA is getting something very valuable in return: curtailed power.
Similarly, in APAC, we examined curtailment provisions that permitted DSIs to reduce power purchases if the DSI paid BPA a fee. 126 F.3d at 1178-79 (analyzing section 18(a) curtailment provisions). We held this was not a rate because the DSI did not receive power in consideration for the fee. Id. at 1178. Admittedly, this case is different from APAC in that the curtailment agreements here permit BPA, rather than the DSI, to reduce power purchases for a fee. This case asks whether the curtailment fee produces a discount, whereas in APAC, the case asked whether the curtailment fee produced a rate increase. Yet the ultimate conclusion still holds; the fee for the curtailment is not for the “sale of electric power or transmission services and is therefore not a rate.” Id.
We do not hold that separability in time, environment, and consideration are necessary to demonstrate the nonexistence of a rate. We also do not hold that other considerations are irrelevant. We merely hold that, on the particular facts before us, BPA‘s curtailment agreements were not rates subject to the ratemaking procedures of the Regional Act. We therefore need not decide whether BPA‘s failure to comply with the ratemaking procedures was excusable under California Energy, 754 F.2d at 1474.
V.
For each proposal to acquire a major resource, the Regional Act requires the administrator to publish notice, conduct a public hearing, develop a record, and make a public written decision.
BPA‘s resource development support for Golden Northwest and its affiliates will be limited to providing the means to facilitate new wind resources. Such support will be negotiated between BPA and GNA to be consistent with detailed principles established by BPA, limited to 200 MW of wind for a 10-year term, and conditioned on any resource being fully permitted and рriced comparably with BPA‘s spring 2001 wind RFP project results.
Bell also relies on the Administrator‘s press release that BPA “will support development of a wind energy project.”
Bell finally аrgues that BPA violated NEPA by not conducting environmental analyses and creating environmental impact statements for its curtailment amendments. We cannot consider these claims unless Bell demonstrates standing. Steel Co. v. Citizens for a Better Env‘t, 523 U.S. 83, 93-94 (1998) (rejecting the doctrine of hypothetical jurisdiction to reаch the more readily resolvable merits).
To establish standing in NEPA cases, Bell must show (1) injury in fact within NEPA‘s zone of interests, (2) causation, and (3) redressability. Cantrell v. City of Long Beach, 241 F.3d 674, 679 (9th Cir.2001). The critical issue here is whether Bell has demonstrated causation.
In NEPA cases, causation requirements are relaxed but still a constitutional necessity; Bell must show a “reasonable probability” that the alleged injury is caused by the challenged action. Pub. Citizen v. Dep‘t of Transp., 316 F.3d 1002, 1016 (9th Cir.2003); Kootenai Tribe of Idaho v. Veneman, 313 F.3d 1094, 1113 (9th Cir.2002); see also Lujan v. Defenders of Wildlife, 504 U.S. 555, 560 (1992) (causation is a constitutional standing requirement in similar Endangered Species Act claim). However, Bell has not shown to a reasonable probability thаt any petitioner‘s enjoyment of the land will be lessened by the lack of environmental analysis, i.e., Bell has not shown causation. Though neither party addressed causation in their briefs, we must satisfy ourselves of standing, FW/PBS, Inc. v. City of Dallas, 493 U.S. 215, 230-31 (1990), as causation is a constitutional requirement to Article III standing. Mendoza v. Zirkle Fruit Co., 301 F.3d 1163, 1172 (9th Cir.2002).
The direct effect of the curtailment amendments is not an environmental injury but a reduction in the amount of power BPA supplies to the DSIs. For the agreement to cause the environmental damage Bell alleges, we must conclude that Bell has shown, to a reasonablе probability, that the curtailment agreements keep the DSIs in business (an inference BPA contests), and that the DSIs will injure the environment. Because Bell‘s standing depends on the action of the DSIs, Bell must “adduce facts showing that those choices have been or will be made in such manner as to produce causation and permit redressibility of injury.” Defenders of Wildlife, 504 U.S. at 562; Pub. Citizen, 316 F.3d at 1017 (applying the requirement to a NEPA claim).
Bell failed to provide facts necessary to show causation, despite the relaxed causation standards for NEPA claims. Bell presents press releases and statements by BPA‘s Administrator that the high cost of wholesale power would likely have forced the companies to shut down. This statement is largely beside the point because the original contracts protected DSIs from the wholesale rate. Bell challenges the contract amendments, not the underlying contracts, аnd our causation analysis must be duly focused on the precise claim asserted. The question is whether the DSIs would have stayed in business with the original contract rates and absent the contract amendments. On this, Bell gives no facts that demonstrate causation. To the contrаry, the DSIs were empowered to curtail their power purchases at the contract rates independently of BPA‘s preferences and even before the challenged curtailment agreements. Bell also does not demonstrate that the DSIs would be unable tо purchase power from other power providers. Bell speculates that, absent the additional sum the BPA pays the DSIs to escape its contractual obligation, the DSIs would have shut down. Bell gives no facts, figures, or data. Such speculation is inadequate under the Supreme Court teachings in Defenders of Wildlife.
Finally, Bell urges that he has standing under APAC, 126 F.3d at 1183 n. 9 (“Utility Reform Project and Kevin Bell аlso raise NEPA claims and it is uncontested that these parties have standing.“). But APAC does not help Bell. First, such “drive-by jurisdictional rulings” are not precedential. Steel Co., 523 U.S. at 91. Second, APAC did not consider a NEPA challenge to the curtailment agreements at issue here, and thus it did not face the above describеd causation problems.
VI.
VII.
We deny Bell‘s petitions for review. We dismiss as moot BPA‘s motion to strike the declaration of Bell‘s counsel and portions of the reply brief. We dismiss Bell‘s challenge in case number 01-70616 as waived.
PETITION DENIED.