argument do it one point argue that in your brief that they knew that almost like that there is a god like fraudulent concealment theory of yours you're saying that you don't have to establish that it's just a fact that they represented that it was temporary and then facts changed in it became permanent later that that sufficient to require further to have found their in the years after two thousand and two there was no indication that they had decided to shutter the plan entirely and so i think that was material for the plant had been closed for six years at the time the applications filed for years i believe perspective of someone who might be considering competing for a license from the hydropower facility it takes a good deal of time to get to prepare a license what what what when the plant was before it was curtailed in two thousand to have much of the power from the yeah i can project was used for activities at here i'm not sure if that's if that's in the record i believe most of the power was before the shutdown occurred four hundred people were employed at the plant and it's not true for operational because i didn't i didn't material because how the power would be used is material right in so there was some sort of expectation at the time don't license application process was going that alcoa was would have an advantage because it was material how the power was going to be used and there was at least some sort of expectation that a significant amount of power would be used for bad works but at the time of the application they represented only about two percent of the power was going to me use for bad works right that's correct i said about the two percent figure i think the important thing to recognize is not that it two percent is obviously a fairly small point th so your argument is that is that he at the time today filed their application where they represented that two percent would be used for industrial use their own industrial use that gave them inherent advantage over any other applicant that was just going to operate the facility and sell on the open market i believe the two percent figure was was there not a power that they were using when they application two thousand and six not in two thousand and two in two thousand and six yes i'm sorry at the time i guess my point is that the argument on the other side is that look even if alcoa even if it's correct that too assumed in elko kind of had some sort of advantage because the power was going to be use for bad words the representation was that only two percent of the power was going to be used for bad works i mean there's nothing in the record that shows that fur in granting the license did so with the expectation at that plant was going to reopen and it was going to go from two percent to fifty percent seventy five or one hundred or whatever it was prior to two thousand to write his or anything like that in the record well i but i think  was not permanent alcoa's stated that the shutdown was temporary the normal mean of temporary is that something's going to resume but now yes i guess in order to kind of gauge the merits of your argument don't we have to you know it's easy to make that what evidence or what what what do we have to look have to look to to infer that people were chilled said that the shutdown would be temporary and second you can look at the reaction that happened in north carolina after it it really did spiling become full core issue in the state and you saw that actually the jobs were not coming back but you saw happen is local people in the end in stanley county north carolina began to complain about this eventually that issue bubbled up to the state level and it became a major issue within state politics that alcoa was seeking a license  run the acting project and a plan that had fired all the employees didn't plan to hire them back and that's once once the actual facts came out you can see it in the jury ality because it was a volcanic eruption in north carolina bangor about what happened and became a major political to compete again cube sat license application could be compared against competitors that might offer greater benefits to the north carolina would also be can have to be compared against the recapture request for a license request application to north carolina with file that what they represented by say this kid council where a license had only been granted temporarily subject to a petition review would protect themselves from that but that two hundred million dollar figure got half a quarter of a billion dollars a fair figure to think about here because essentially what will reopen at this point at this point no legrand right so we just can't unscramble the egg that here that you've been complaining about of course that's that stuff my crack smelting plan well i think it delayed the the emergence of this is a political issue in north carolina i think if i go i had been forthright opportunities it's to respond to the sire's needs of the citizens and once it became clear that these jobs aren't coming back there was an uproar in north carolina and at that point it became a lie political issue for the state and the state wanted to make sure that this  in north carolina could be well in the states recapture your question or honor the state stated that it wanted to use the profits from the get can project to try to find economic development projects around the state to support the six community colleges the state also indicated that there was a need for the state to gain greater control over its water resources as well and so i think that that's this is exactly the sort of competition that the f p a intensify auster where there's a chance to weigh different environmental agencies signed off on the cell phone agreement that laid out how the project would operate what sort of environmental remediation would take place going forward so that as you said just until that that issue has been resolved  is generally off the table just getting back to what was discussed the underlying issue here the bait and switch claim such as it is i think it's important what fundamentally what north carolina is claiming is that hey we believe this asset can be used differently and for for our view of how the power should be distributed should take precedence over alcoa's because now we know they are using it in ways we don't agree with and i think the possibility that alcoa would sell power into the market and use the patent the project power in the manner it thought was best was apparent from the beginning i mean as we talked about in this initial consultation document in two thousand and two was forthright and said  and i think it's important they came out and said our our operations in the temporarily curtailed and that we're selling power in the market i think there's two things that are important about this document everything seems to hinge on the use of the word temporary in that document and it issued in september two thousand and two which is just one month after market conditions caused alcoa to to scale back its operations so the notion that this was some sort of smokescreen or ruse to chill competition i think is undercut by the very chronology second the document the purpose of this initial consultation document is just give everyone a heads up this is we're coming up on realize and seem these are the issues that could emerge so you can start a conversation with the environmental resource agencies and interested parties so that they can identify what studies need to be conducted and the like i'll code you need to get into how the power is going to use or anything like that but they did put that in there but that's not yet i mean two years later march two thousand and four comes in and says we told you back in two thousand and two market conditions cause us to stop control her tail operations two years later that's still the case and i think what they said years is important they said the bulk of the power and energy generated at the project is no longer needed for industrial purposes and in the state's brief they use they contend that alcoa dangle the possibility of a jobs coming back and i think this is this document for sure undercuts that rather than dangling the possibility of jobs coming back alcoa signed a power purchase contract with the industrial facility to experiment there and was selling it in the market that's two years before the deadline for competing applications how how long would it take just ballpark for someone else in the market to decide we want to come in and bid for this license it's an extensive process  i would say once a year couple years yeah yeah and so the initial documents four years out from the deadline the subsequent letter was two years out and again it is as your honour's of pointed out what  ultimately filed was completely consistent with its public representations so in terms of the the concern about skewing competition and fending off competitors really the only document that likely matters is the two thousand to right i mean it's if you thought that the license application were a little bit overly bullish about the jobs returning i mean it's ridiculous to think that five days before right the deadline would have read any material impact right and but i think it's important that the what's in the application again underscores that alcoa was being cand what it represented in the applications because i don't know i mean i've we look at the application does seem to emphasize a great deal the importance of the project the yet can project been curtailed in only three to five megawatts very very tough but in terms of overall it's important to their industrial operations because they can sell that low cost power and use the proceeds to offset the cost of energy at their other other facilities relevant to the licensing proceeding are you before us conceding that it is not relevant because i can't take can understand from your grief exactly what you're what is here i think the in retrospect the phrase how a power how project power will be used was a little bit imprecise looking back what section fifteen of the federal power i think you know it requires is that requires a commission to look at one of the factors is the need for power certainly that is relevant the applicant's need for power and if they're selling into the market that equates into sort of the real estate need for power and this statute is pretty broad right it focuses the commission on the public interest it specifically talks about interests of customers communit i'm using part of my need is based on the industrial operations that uses project power for the christian s and look at ok well what if the project goes away what will be the effect of the alternative source of power on the africans industrial operations and the local community and what the commission incorporates that into its analysis generally be affected communities by looking at the difference in price between the power being generated by the proposed project and alternative sources  that comparison was carried out in the in the licensing or what the commission so need for power is relevant obviously under under section fifteen what the it doesn't get into is directing which specific customers should receive in that application process the alcoa came in and said we're going to use this power for this project and when in that posture for the for the big works and that posture section fifteen directs the commission to consider that as part of this need commission in this case alcoa came in and said we're going to be selling the power into the into the market two percent right now is used for they'd work that's the only thing that's changed in the ensuing shutdown of the project that two percent of the commissions analysis proceeded on the is not wrong which specific customers i think it is is what was intended here is not relevant to the commission's analysis unless someone comes in as alcoa did the first go around and said part of my need is for my the federal power act which specifically requires in a takeover contest context that the federal government take over and thereafter up and maintain and operate and that's not what the states are proposing here so i it's question in was and that was that reason articulated by the commission it was it was in the paragraph one forty two of the relicensing order  office of energy projects this is not in the brief because it came up on rehearing but i would just note that section three seventy five point three zero eight authorizes the director to take action on in l it remains one of the grounds for decision unless it's explicitly abandon yes i mean i think the the rehearing order essentially i mean the purpose obviously is to correct any errors in them in the initial decision and address found that it had been ratified a rehearing not to be clear there it was explicit ratification because the delegation should raise the level but i think fundamentally that is what's happening in this order in most rehearing orders because she corrects whatever  but otherwise ratifies the lysine order and i think if you look at the last couple pages of the rehearing order you know that that may be true in most orders but what's striking about this sequence is that the treatment of this issue in the original licensing order which references the authority question is pretty perfunctory and then there's a motion to rehearing and then on the rehearing order there's a pretty extensive treatment of this issue and it's it doesn't doesn't come back and repeat the authority question right well with respect to between eleven and fifteen issues raised on rehearing and the commission focus primarily on those that have not been addressed in detail below and there have been various variations on the theme this statutory construction argument that it's a thirty four page rehearing order there is i believe one sentence dedicated to the discussion of why it's not for close by the language and it's what we hear in the brief that while it doesn't explicitly say we don't have to pass along so i think the question is treatment of the issue in general on rehearing was appropriate let's there's any further questions your honor thank you thank you all right mr wright for intervening good morning made please the court morning there was no bait and switch there are four documents only four that you need to look you had to come to that determination first j a three fifty three which is a paragraph from the initial consultation document one month as counsel for the commission said after the temporary curtailment alcoa forthrightly referred to the temporary curtailment and said during this period of energy generated at the project is used by alcoa to support its other aluminum operations or sold on the open market second c three sixty six a voluntary submission from counsel for alcoa and judge head says i think this goes directly to the question you were asking about how much time somebody would need to prepare a competing application this letter is profoundly important to this question because it is simply not true that alcoa repeatedly said this curtailment was temporary in judge said tell it did not say that in the application it said it exactly once it said it in that initial consultation document at three fifty three and then in this letter at three sixty six and hearken back to that representation it said due to adverse business conditions in the aluminum industry alcoa in late two thousand and two decided to temporarily curtail the production of primary aluminum at the bait works but it went on very very important to say although some minimal amount of power project power continues to be consumed at the industrial facility the bulk of the power and energy generated at the project is no longer needed for industrial purposes in the interim since the smelter shut down have been selling the power etc given that aluminum market conditions still have not improved sufficiently to permit resumption of aluminum smelting at bain works alcoa has now decided to assign its purchased contract to another of its affiliates so things have changed greatly now it's a year and a half after that decision any reasonable person judge had says i think reading this letter and it's only two pages long should have said to themselves oh my god ba that consider well there may have been interest later as you say and i know you're aware of that later issues judge wilkins but the state said this morning and it said in his brief at three that it was resting on its hope that the beta works would come back my point to you is alcoa voluntarily informed the commission and the world this letter was served on the service list this plant may not be coming back and that was in two thousand and four and competent counsel should know that the deadline was the same for competing applications as it was for elko april thirtieth two thousand and six to get an application prepared they had more than two years notice from this letter judge kansas and then a three eighty one in the application they say curtailed and a page six of our brief we point out that in two thousand and five in the initial draft of the application which people were provided by alcoa the state acknowledges that a page nine o four  they had a draft of an application if they wanted to work from that judge taxes in two thousand and five and the draft didn't say temporary so never again other than harking back in two thousand and four to the two thousand and two statement that  tempered if the commission had assessed all of these facts and the timeline that you're running through and then the time line going forward from two  and said we don't think that could be compels reopening sports reopening that would be fine but arguably it seems like their assessment of all of this was artificially constricted when on the backend and just say we're not we're not going to look at downstream use at all because we don't think it's relevant that had been a commission determination consistently since one nine hundred twenty with two exceptions one is the power authority state in your case cited in the briefs in which congress clearly intended the commission found the f t c found that there be a regional allocation the power the other case with city of seattle which we discussed in our brief which commissions cited on rehearing and the commission into twenty thirteen on relicensing acknowledged that it erred in getting in the allocation of the power at the time of initial licensing in seattle put those two exceptions to one side and the commission has been consistent for almost one hundred years that it only looks at need and not allocation of power that is an unbroken interpretation of the statute judge has is that i think is powerful here and consistent with all of the language about considering interests of the community and such yes and i think commission explained that this morning sure can take those things into account particularly if it's not going to relicense the project but here alcoa was forthright all the way along about what it was what it circumstances were and by the way i think was it really important for you to understand alcoa didn't say we don't want to pay all this money to do all this environmental cleanup or for some other reason don't want to do this what how coas said was were a prisoner of the global aluminum market place we can't operate this they didn't work facility profitably because of the market and everybody ought to know that even as large  doesn't run the global aluminum marketplace and so does state and anybody else a potential competitor judge will consider should have said oh my god alcoa is a prisoner here let's get some help in understanding the global marketplace or at least let's just look at the price of aluminum and see if it's coming back and if it's not maybe we ought to put two and two together and figure out that these bain works probably aren't coming back and it's not reasonable to just rely on your hope that they'll come back as the state has said if there's a reasonable likelihood they're not coming back any chance i would argue then you've got the same deadline everybody else does to get your competing application so what's your response to the argument by your friends on your side  presence works project i don't believe it was a factor because as the commission has said by the time the application goes in only two percent of the power from the project is going to begun works everybody's that now by then it ninety eight percent is going into the marketplace in the draft it was closer to ninety six or ninety seven percent but this is been known for years so the use of power by the baiting works was really of almost in consequential at best and the commission has said really it's irrelevant because it's not allocation of power it's not the use of the power it's the need for the power and the commission made a determination that there was a regional need for the power from this project that was the need predi whereas by the way change sent tell fifty or sixty years ago at the time of the initial licensing although there was discussion of the use of the power at the baden works as the commission said in its brief the commission also not at that time back in the fifty's that it was impossible to figure out what the need for this power would be in the future you couldn't project that far into the future so by the time we get to relicense singh the need question judge wil regional basis and there the commission found there was a need for the project and it really was irrelevant that the baiting works was using two percent or or no percent at that point there was a still a need that that's how the commission analyzes that is could i just make one last point creep that that what the state is really trying to do is is is fundamentally unfair in my client because as you noted this purchase price was in the hundreds of millions of dollars the company has spent tens of millions of dollars since this is q to do all the things that are required under the license and the state in its brief it seventeen notes six refers to alcoa's net investment of twenty four ninety one million dollars and presents two different figures there and and wants to suggest apparently that it should be allowed to have a federal takeover handed pitt the from the federal government to the state and pay twenty four ninety one million dollars for something that we spent hundreds of millions of dollars on in good faith and under the statute only the federal government gets to pay net investment plus severance damages fourteen a makes it absolutely clear that if the state takes the project it's got to be a just compensation fair market value thank you very much thank you that in the rehearing order there was no discussion of the federal power act and whether northwest proposal was or within the federal power act when that was a specific issue that we moved three hearing on and there was no there was no response