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FERC's Glick worries order will hamper state clean water certificate rights

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FERC's Glick worries order will hamper state clean water certificate rights

The Federal Energy Regulatory Commission has approved a new 40-year license for an inactive hydroelectric facility in North Carolina. But in a partial dissent, Commissioner Richard Glick objected to the order's suggestion that the refiling of license applications with major changes is "irrelevant" when deciding whether states have waived their authority to weigh in under the Clean Water Act.

Glick also objected to the majority's suggestion that the time limit on deciding when states have waived their authority to issue clean water certificates does not restart when the applicant makes significant project modifications.

In a Sept. 20 order, FERC granted a 40-year license for McMahan Hydroelectric to operate and maintain the unused 600-kW Bynum hydroelectric project (No. P-14858), located at a dam on the Haw River in Bynum, N.C. The plant, which needs to undergo rehabilitation, has not produced power for at least 10 years, and its license, first issued in 1985, had expired in 2015.

McMahan in March 2017 asked the North Carolina Department of Environmental Quality, or DEQ, to issue a water quality certificate for the Bynum project pursuant to Section 401 of the CWA. Under Section 401, FERC cannot issue a license authorizing the construction or operation of a hydroelectric project unless the state water quality certifying agency either has issued a certificate for the project or has waived its right to do so by failing to act on a request "within a reasonable period of time (which shall not exceed one year)."

At the direction of DEQ and after the agency failed to act within a year on its application, McMahan withdrew and refiled it twice, first in February 2018 and then on Feb. 11.

Meanwhile, on Jan. 25 the U.S. Court of Appeals for the District of Columbia Circuit in Hoopa Valley Tribe v. FERC held that a state waives its Section 401 certification authority "when, pursuant to an agreement between the state and applicant, an applicant repeatedly withdraws-and-resubmits its request for water quality certification over a period of time greater than one year."

Here, FERC acknowledged that the North Carolina DEQ failed to meet the deadlines for acting on the license applications and that the DEQ directed McMahan Hydro to repeatedly withdraw and refile the license application. As such, the DEQ had improperly delayed the licensing of the Bynum project. The commission further maintained that the applicant's resubmittal of the license application "did not restart the one-year clock" for DEQ action. Thus, FERC determined that the DEQ waived its Section 401 certification authority.

Glick's partial dissent

In his partial dissent, Glick explained that he agreed that the DEQ waived its Section 401 certification authority, but disagreed with "aspects" of how Chairman Neil Chatterjee and Commissioner Bernard McNamee reached their conclusions.

"I disagree with the commission's suggestion that additional information submitted by an applicant is irrelevant when determining whether a state waived its Section 401 authority," Glick wrote. "But we need not conclusively resolve this issue because the record indicates that the applicant withdrew and resubmitted its Section 401 application at the state's direction for the purposes of avoiding waiver and without any substantial intervening modification."

However, Glick asserted that the court in Hoopa Valley did not address situations where an applicant withdraws a license application and then resubmits a modified one. "Indeed, the court explicitly did not discuss the situation in which an applicant 'withdrew its request and submitted a wholly new one in its place,'" or "how different a request must be to constitute a 'new request' such that it restarts the one-year clock."

"Nothing in Hoopa Valley's reasoning requires the commission to determine that a state waives its water quality certification authority when the applicant withdraws and resubmits a modified application," continued Glick. "Nevertheless, today's order appears to suggest that additional information submitted to the state after the initial application is irrelevant to determining whether the state waived its authority."

Glick raised the possibility that "a significant modification to a pending section 401 application may justify withdrawing and resubmitting that application without running afoul of section 401's time limitation." He noted that the majority disagrees, reasoning that a state asks for information, at times relating to significant matters, all the time.

"It is true that considering whether a significant supplemental submission restarts the one-year clock might make it more difficult for the commission to find that a state has waived its section 401 authority. But that is not, in my opinion, a persuasive reason to ignore the effects that such submissions might have on the one-year clock," Glick concluded.