Lead Opinion
Opinion for the Court filed by Circuit Judge ROGERS.
Concurring opinion filed by Circuit Judge RANDOLPH.
In exercising judicial review under § 313(b) of the Federal Power Act (“FPA”), 16 U.S.C. § 825Z(b), the court is again confronted with the unusual statutory configuration where, in granting hydroelectric licenses, the Federal Energy Regulatory Commission is obligated both to conduct its own environmental assessment to protect and enhance fish and wildlife and to include such prescription conditions for fishways as the Secretary of the Interi- or may direct. See 16 U.S.C. §§ 803(j), 811. Wisconsin Power and Light Company (“WP&L”) petitions for review of Commission orders placing conditions on its license as a result of the Secretary’s prescription. Essentially, WP&L contends that the Secretary’s prescription is unsupported by substantial evidence. Although WP&L did not argue on rehearing before the Commission with the specificity presented in its brief on appeal, because we conclude, in light of the statutory scheme, that there was a “reasonable ground for failure so to do” under FPA § 313(b), the court has jurisdiction to address the merits of WP&L’s petition. Upon so doing, we conclude that WP&L’s challenges to the Secretary’s prescription conditions lack merit and that any challenge it may have to potential costs of fishway devices is not ripe.
I.
FPA § 10(j) provides that “in order to adequately and equitably protect, mitigate damages to, and enhance, fish and wildlife (including related spawning groups and habitat) affected by the development, operation, and management of the project, each [hydroelectric] license issued ... [by the Commission] shall include conditions for such protection, mitigation, and enhancement.” 16 U.S.C. § 803(j)(1). However, regardless of what conditions the Commission may or may not include in a license, FPA § 18 provides that “the Commission shall require the construction, maintenance, and operation by a licensee at its own expense of ... such fishways as may
The Prairie du Sac Hydroelectric Project (“the project”) is a twenty-nine megawatt dam located on the Wisconsin River in south-central Wisconsin about ninety miles upstream of the Mississippi River. See Wisconsin Power & Light Co.,
On June 27, 2002, the Commission granted WP&L a thirty year license for the project subject to conditions. The license included most § 10(j) recommendations, with the exception of those concerning fish passage. Rejecting the recommendations of the Secretary and the Department, the Commission did not include conditions in the license requiring WP&L to make provision for the upstream movement of fish around the dam or to take measures to protect fish from injury when traveling downstream through the project. The Commission, adopting a staff report, found no evidence of an effect on fish populations due to turbine mortality or fish entrainment, whereby fish enter the project’s water intakes and pass through its generating turbines, and therefore declined to require the installation of “expensive protection devices.” Id. at 64,515 ¶ 14. The Commission likewise determined that, because of the “dubious chance for success” and high construction costs, measures were not required to permit fish to travel upstream around the dam. Id. at 64,516 ¶ 19. Instead, the Commission recommended that WP&L develop a plan in consultation with the Secretary and the Department to identify specific measures to enhance fishery and other aquatic resources in the project’s vicinity. While concluding the fishways would not be in the public interest, the Commission stated that “should new information in the future indicate a different finding,” the Secretary’s § 18 prescription authority was reserved. Id.
The Secretary and the Department requested rehearing, citing new information
WP&L sought rehearing of the Amended License Order on the ground that the Commission inadequately explained the reversal of its Initial Order. In the request for rehearing, WP&L argued that there was no reasoned basis for the Commission’s imposition of additional conditions in the amended license, and that no record evidence demonstrated the need for fish-protective devices. Even if circumstances had changed since the Commission completed its environmental assessment, WP&L argued, the Commission had erred by failing to consider cost and technical issues in amending the license. The Commission denied rehearing because “[t]he Commission has no authority to amend or reject a Section 18 prescription that is timely filed.” Order Denying Rehearing,
WP&L petitions for review of the Commission’s orders on the ground that the Secretary’s prescription was arbitrary and capricious because the record fails to show that fish entrainment at the project has an adverse effect on fishery resources, that the prescribed entrainment protective devices are technically feasible, would be effective, and survive a cost-benefit analysis, and that the fish species the Secretary seeks to protect would use or benefit from the prescribed upstream fish passage facilities.
II.
As a threshold matter, the Secretary challenges the jurisdiction of the court to consider WP&L’s challenge to the Secretary’s fishways prescription. Because WP&L, according to the Secretary, did not argue in its- request for rehearing by the Commission that the Secretary’s § • 18 conditions are not supported by substantial evidence, but instead claimed only that the Commission had failed to justify the change from its original decision not to impose fishway conditions, the Secretary maintains that the court may not consider the contentions presented in WP&L’s brief.
FPA § 313(b) provides in pertinent part that “[n]o objection to the order of the Commission shall be. considered by the court unless such objection shall have been urged before the Commission in the application for rehearing unless there is reasonable ground for failure so to do.” 16 U.S.C. § 825l(b). This court strictly construes the jurisdictional requirement that such objections must be specific. See
In Bangor Hydro-Electric Company v. FERC,
Under the interpretation of the statutory scheme adopted in Bangor,
Accordingly, because FPA § 313(b) contemplates situations in which the court will review matters not presented to the Commission, we hold in light of the statutory scheme that WP&L had “a reasonable ground” for failing to set forth its objections to the Amended License Order in its request for rehearing by the Commission with the specificity that is customarily required. We therefore turn to the merits of WP&L’s challenge to the Secretary’s prescription as set forth in the Amended License Order.
III.
FPA § 313(b) provides that “[t]he finding of the Commission as to the facts, if supported by substantial evidence, shall be conclusive.” 16 U.S.C. § 825l(b). The statute implicitly invokes the familiar arbitrary and capricious standard. See Bangor, 78 F.3d at 663 & n. 3. Thus, in seeking to have the court declare the Secretary’s prescription to be arbitrary or capricious, WP&L bears a heavy burden. See Transmission Access Policy Study Group v. FERC,
In contending that the Secretary’s prescription for upstream fish passage was arbitrary and capricious, WP&L focuses on the Secretary’s 1997 statement that, as regards turbine mortality of fish, “biological significance is not the primary issue,” but rather that “project operation results in the mortality of important fishery resources, which are the property of the State of Wisconsin.” WP&L contends that the record lacks substantial evidence to support the proposition that fishery resources have economic value, and implicitly maintains that any prescription based on an unsupported rationale is arbitrary and capricious. But WP&L confuses the rationale provided by the Secretary in 1997 for recommendations to the Commission pursuant to FPA § 10(j), 16 U.S.C. § 803(j), which obligates the Commission to include license conditions that protect and enhance fish and wildlife, with the revised rationale applicable to the Secretary’s § 18 prescription. In any event, the Secretary’s 1997 recommendations proffered further rationales that are supported by substantial record evidence, such as that “reestablishing upstream and safe downstream passage around the [project] for paddlefish would help considerably to preclude the need for the [Fish and Wildlife Service] to formally list this species on the Federal list of threatened and endangered species and would help considerably to allow this species to be removed from the State list.” And, although the Secretary’s 2002 prescription incorporated by reference her 1997 recommendations, the prescription
Moreover, that the protection and conservation of fishery resources underlies the Secretary’s § 18 prescriptions need not be proved in every such prescription, for Congress has made clear that the purpose of § 18 is to provide for “safe and timely” fish passage, see Pub. L. 102-486, § 1701(b), 106 Stat. 3008 (1992), as well as other “fish and wildlife benefits both downstream and upstream of a project.” H.R. Conf. Rep. No. 99-934, at 23 (1986). Furthermore, the Secretary issued a comprehensive plan that has been accepted by the Commission pursuant to FPA § 10(a), 16 U.S.C. § 803(a). The plan identifies the Secretary’s commitment to protect the quality and quantity of the nation’s recreational fisheries that she has found to be socially and economically significant. See Fisheries USA: The Recreational Fisheries Policy of the U.S. Department of the Interior Fish and Wildlife Service at 4-5, available at http://poli-cy.fws.gov/alnpi89_25.pdf. To serve these goals requires restoration or enhancement of depleted or declining fisheries, such as exist at the project. Hence, the Secretary need not establish whether fishery resources warrant protection as a general proposition, but rather must provide substantial evidence to show that fishery resources will be adversely affected by a particular project as well as to support the particular solutions for protecting those l'esources.
WP&L contends for the first time on appeal, however, that the Secretary is bound by a regulation of the Commission to the rationale and evidence provided for the prescription in her initial comments in 1997. See 18 C.F.R. § 4.34(b)(1). Although this contention is raised in WP&L’s reply brief, see City of Nephi v. FERC,
WP&L also contends that substantial evidence is lacking to support the Secretary’s prescription because the administrative record cites to studies that were not formally submitted to the Commission and in some instances were not specifically identified. This contention fails for two reasons: WP&L relies on a misunderstanding of the information on which the Secretary may properly rely and
The record before the Commission meets this standard because it was appropriate, given the paucity of site-specific information as a consequence of WP&L’s resistance to studies at the project, for the Secretary to cite relevant, publicly available studies, which need not have been introduced into the record. Insofar as the Secretary mentioned studies not specifically cited for given propositions but that were included in attached bibliographies, the studies that were cited with particularity constitute substantial evidence sufficient to support the Secretary’s prescription. For example, the Commission’s final environmental assessment established that turbine mortality rates at the project could range up to twenty percent, therefore showing the need for entrainment protection devices; the report of WP&L’s consultant indicated that several entrainment protection devices may be effective at the project and warrant further study; a Department report demonstrated that enabling upstream passage around the dam would help to reestablish the threatened paddlefish to its traditional habitat on the upper reaches of the Wisconsin River; a 1932 study proved that operation of the project’s navigation lock facilitated upstream fish passage; and the Secretary’s request for rehearing cited research demonstrating that new prototype fishways had successfully enabled passage of fish species found at the project. In sum, the Secretary’s reference to other studies for which no detailed footnotes were provided served merely to bolster, and does not detract from, the independent sufficiency of substantial evidence that was properly cited or introduced into the record.
Secondly, in contending that there is not substantial evidence to show that fish entrainment at the project has an adverse effect on fishery resources, WP&L ignores record evidence, including that in its license application. An analysis provided by the Department to WP&L in response to a draft of the license application indicated that thirty-four percent of walleye tagged above the dam were recovered below it. Because the dam is a complete barrier to upstream fish movement, the Department stated that “those fish are forever lost to the [above-dam] lake fishery.” In addition, the Commission’s environmental assessment of the project esti
WP&L nonetheless maintains that the record permits no conclusions about entrainment and turbine mortality at the project because only one study, which did not directly evaluate entrainment, was done at the project. The record shows that further studies at the project were not completed because WP&L rescinded its proposal to do so, despite its consultant’s acknowledgment that such studies were “justified.” The applicable standard of review does not demand perfect information, but only requires substantial evidence, see 16 U.S.C. § 825l(b), which may include findings made in light of uncertainty. See Department of the Interior,
WP&L additionally contends that record evidence fails to show that the Secretary’s downstream passage prescriptions are technically feasible and effective. The Commission’s environmental assessment cast doubt on certain entrainment protective devices, such as a mesh net. However, the Secretary could reasonably rely on the more favorable assessment contained in WP&L’s application as well as recent research at similar facilities. Given conflicting views, the Secretary had “discretion to rely on the reasonable opinions of [her] own qualified experts even if, as an original matter, a court might find contrary views more persuasive.” Marsh v. Oregon Natural Resources Council,
With regard to the upstream passage prescription, WP&L similarly identifies record material evidencing doubts about whether the prescribed fishways are technically feasible and would be effective. The Commission’s environmental assessment concluded in 2000 that “based on the analyses done to date, ... there is no technically feasible means to provide upstream fish passage at Prairie du Sac dam, particularly for the primary species of concern.” However, the Secretary’s prescription relied on evidence, which was not available at the time of the Commission’s environmental assessment, that refuted the Commission’s conclusion that a fishway would not be effective for target species like lake sturgeon. Moreover, a 1932 study, which the Commission failed to credit, contradicted the Commission’s hypotheses; the study showed that a then-operable, preexisting navigation lock at the project permitted thousands of fish from a wide range of species, including sturgeon, to bypass the dam. WP&L’s license application also included a 1993 study that concluded that threatened “[pjaddlefish would probably enter the Prairie du Sac dam lock if it were operational.” Based on such substantial evidence, the Secretary
Lastly, WP&L contends that prescription of entrainment protective devices potentially requiring expenditure of a “huge sum” for a “questionable return” constitutes arbitrary and capricious action by the Secretary. In its view, “the cost of any downstream fish protection facilities would far outweigh any benefit to fish or fisheries in the Wisconsin River.” Petitioner’s Br. 20. Such a prescription, WP&L maintains, cannot be “consistent with law” or “reasonably related to [its] goal.” Bangor,
Accordingly, we deny the petition for review.
Concurrence Opinion
concurring:
Bangor Hydro-Electric Co. v. FERC,
