In an order dated May 20, 2021, the Federal Energy Regulatory Commission (FERC, or the Commission) terminated the hydropower licenses for three projects located on the Tittabawasee River in Michigan—the Secord (P-10809), Smallwood (P-10810) and Sanford (P-2785) dams. The termination by implied surrender follows a May 2020 breach at the Sanford dam and the breach and failure of the upstream Edenville dam, which was also operated by the same licensee before the Commission revoked the Edenville license in 2018 due to the licensee’s repeated noncompliance with FERC dam safety orders. The resultant floods caused significant damage in the communities surrounding the dams and have been estimated by the State of Michigan to have caused economic harm exceeding $190 million.
Second Circuit Enforces the Clean Water Act Section 401 One-Year Time Limit
On March 23, the Second Circuit issued its opinion in N.Y. Dep’t of Enviro. Conservation v. FERC, Case No. 19-1610 (i.e., the “Empire Pipeline” case). The case concerns the Federal Energy Regulatory Commission’s (FERC or Commission) determination that the New York State Department of Environmental Conservation (NYSDEC) waived its water quality certification authority with regard to FERC’s issuance of a gas pipeline certificate when NYSDEC sought to extend its review period beyond the one-year deadline under Section 401 of the Clean Water Act (CWA or Act) by agreeing with the applicant to “post-date” the filing date of its water quality certification application by several weeks.
Biden Administration Announces Tribal Consultation Policy
The Biden administration has highlighted Tribal sovereignty and the federal trust responsibility to Tribal Nations as the cornerstones of its federal Indian policy. The involvement of Native American tribes is also a component of the Biden administration’s environmental justice initiatives. Accordingly, on January 26, the Biden administration issued a “Memorandum on Tribal Consultation and Strengthening Nation-to-Nation Relationships” (Presidential Memorandum), which seeks to prioritize regular, meaningful, and robust federal consultation with Tribal Nations. According to the Presidential Memorandum, “History demonstrated that we best serve Native American people when Tribal governments are empowered to lead their communities, and when federal officials speak with and listen to Tribal leaders in formulating federal policy that affects Tribal Nations.”
FERC’s Clean Water Action Section 401 Waiver Analysis Continues to Evolve
In 2019, the D.C. Circuit in Hoopa Valley Tribe v. FERC held that the plain language of Clean Water Act (CWA) Section 401 establishes a bright-line maximum period of one year for States to act on a request for water quality certification and that the Federal Energy Regulatory Commission (Commission) was arbitrary and capricious when it failed to enforce the statutory time-limit. Since the Hoopa Valley Tribe ruling, the Commission has repeatedly held that a State waives its authority under Section 401 when it has sought to extend the one year review period by requesting or directing the applicant to withdraw and resubmit its application to afford the state reviewing agency more time. In several recent cases, however, the Commission has found that there may be instances where a withdrawal and resubmission of a water quality certification by the applicant does not result in a State’s waiver of Section 401 certification authority.
Hydropower Advocates and Environmental Groups Reach Historic Agreement
On Tuesday, October 13, the National Hydropower Association (NHA) announced its partnership with American Rivers, the World Wildlife Fund, and other environmental groups in a “Joint Statement of Collaboration on U.S. Hydropower: Climate Solution and Conservation Challenge.” The Joint Statement, which was facilitated over the last two and a half years through Stanford University’s Uncommon Dialogue process, is a collaborative effort to address climate change by encouraging “the renewable energy and storage benefits of hydropower and the environmental and economic benefits of healthy rivers.”
FERC Issues Order Proposing Substantial Penalty for Licensee in Michigan Dam Failure
The Federal Energy Regulatory Commission (FERC) has issued an order proposing a $15 million civil penalty in response to the failure of a licensee to respond to FERC dam safety orders in the wake of the failure of the Edenville dam and downstream FERC-licensed Sanford Dam (Project No. 2785) in Michigan in May 2020 (see June 1, 2020 edition of the WER). The December 9, 2020 Order to Show Cause and Notice of Proposed Penalty followed months of FERC orders and directives to the licensee related to the catastrophic failure of the two dams, which resulted in the evacuation of 10,000 people, an estimated $190 million in economic damages to local residents, and $55 million in response costs, prompting Governor Gretchen Whitmer to request a disaster declaration from the federal government.
CEQ Final Rule Overhauls NEPA Regulations
On July 16, 2020, the Council on Environmental Quality (CEQ) published its long-awaited final rule to amend its regulations implementing the National Environmental Policy Act of 1969 (NEPA), introducing important changes to the 40-year-old review process. The statute requires federal agencies to take a “hard look” at the environmental impacts of certain proposed projects, but does not mandate any particular outcome. The final rule follows CEQ’s June 2018 Advanced Notice of Proposed Rulemaking (ANOPR) and the January 2020 Notice of Proposed Rulemaking (NOPR), which we previously discussed here.
Long-Awaited EPA Rule Overhauls Section 401 of Clean Water Act
On June 1, the Environmental Protection Agency (EPA) released a final rule clarifying substantive authorities and procedural requirements for water quality certifications under section 401 of the Clean Water Act (CWA). EPA’s August 2019 notice of proposed rulemaking (NOPR) (summarized in our previous post) articulated the Agency’s first-ever statutory interpretation of section 401 since its enactment nearly 50 years ago, and proposed sweeping substantive and procedural changes to its section 401 regulations in conformance with its interpretation. EPA’s final rule largely adopts the regulations in its NOPR, but makes important changes in adopting new regulations that preserve authority of states and Native American tribes exercising “Treatment as a State” (TAS) authorization to ensure that discharges from federally licensed and permitted activities meet state and tribal water quality requirements.
EPA Issues Draft Temperature TMDL for Columbia and Snake Rivers
The question of how to regulate temperature in water bodies is one that states in the Northwest have struggled with for years. The U.S. Environmental Protection Agency (EPA) addressed that question on May 18, 2020, when it released a draft Total Maximum Daily Load (TMDL) to achieve water quality standards for temperature in certain reaches of the Columbia and Lower Snake Rivers in Oregon and Washington. This new TMDL comes a few months after a decision from the U.S. Court of Appeals for the Ninth Circuit, Columbia Riverkeeper v. Wheeler, requiring the agency to take the lead after Oregon and Washington failed to submit their own TMDL. Comments on the draft TMDL are due by the end of July 21, 2020.
U.S. Court of Federal Claims Rules on Takings Claims Against Dam Owners Stemming from Flooding During Hurricane Harvey
The U.S. Court of Federal Claims (CFC) recently decided two cases related to flood events during Hurricane Harvey in Southeast Texas in 2017—one finding a taking by the United States Army Corps of Engineers (USACE) for flood control management and allowing landowner recovery, with the other holding that no taking occurred during the same event. As the incidence of flooding events may become more prevalent and unpredictable in a changing climate, these two decisions provide guidance for dam operators, including hydroelectric project operators, that conduct flood management activities in cooperation with, and sometimes at the direction of, USACE or other governmental entities.