Opinion ID: 2538601
Heading Depth: 4
Heading Rank: 2

Heading: Major energy facility standard

Text: Major energy facility is defined at 6 AAC 80.900(22) to include: marine service bases and storage depots, pipelines and rights-of-way, drilling rigs and platforms, petroleum or coal separation, treatment, or storage facilities, liquid natural gas plants and terminals, oil terminals and other port development for the transfer of energy products, petrochemical plants, refineries and associated facilities, hydroelectric projects, other electric generating plants, transmission lines, uranium enrichment or nuclear fuel processing facilities, and geothermal facilities; major energy facility means a development of more than local concern carried out in, or in close proximity to, the coastal area, which meets one or more of the following criteria: (A) a facility required to support energy operations for exploration or production purposes; (B) a facility used to produce, convert, process, or store energy resources or marketable products; (C) a facility used to transfer, transport, import, or export energy resources or marketable products; (D) a facility used for in-state energy use; or (E) a facility used primarily for the manufacture, production, or assembly of equipment, machinery, products, or devices which are involved in any activity described in (A)-(D) of this paragraph[.] The regulation requires that a coastal project involving major energy facilities meet various siting and other criteria where feasible and prudent. [27] The Division found that the major energy facility standard was inapplicable to the Airport's proposal. ACE alleges that the Division's failure to consider the major energy facility standard rendered the consistency determination arbitrary, as it failed to consider an important factor. [28]
ACE points out that the list of possible uses included in the Division's consistency determination included fuel storage, transportation and dispensing as a runway-dependent use and provision of bulk fuel storage facilities [29] as an aviation-related use and declares that it is beyond question that [the Airport] is a `development of more than local concern' and that the fuel will be for instate energy use. ACE contends that the State's argument in the superior court that the court should defer to the Division's interpretation of the standard so as to apply to energy-related facilities, not to businesses that use fuel in daily operations is faulty. ACE maintains that the Division's interpretation is inconsistent with the regulation's plain language and that the Division did not provide in the consistency determination or in the administrative record a reasoned justification for reinterpreting the plain language definition of `major energy facility.' The State counters that the Division developed the major energy facility standard in response to oil and gas development and that the Division therefore interprets the standard to apply to facilities that provide energy rather than developments that use energy incidentally. The State claims that ACE's definition would absurdly encompass any development of more than local concern that anywhere within it stored or used energy products of any amount, including a five-gallon propane tank. ACE's argument concerning the Division's interpretation of the standard must fail. While it is possible that a plain-language reading of the definition of major energy facility could apply to the airport expansion since Anchorage International Airport is a development of more than local concern that will store energy resources for in-state energy use, we have rejected the plain meaning rule in favor of a rule wherein `[s]tatutory construction begins with an analysis of the language of the statute construed in light of its purpose.' [30] We have explained that even when a statute's language meaning seems plain on its face, ambiguity may arise if applying that meaning would yield anomalous consequences, and that because `plain meaning' cannot exist in a vacuum, ambiguity is necessarily a creature of context. [31] We have therefore concluded that `[w]hen a statute or regulation is part of a larger framework or regulatory scheme, even a seemingly unambiguous statute must be interpreted in light of the other portions of the regulatory whole.' [32] Reading the entire definition of major energy facility in 6 AAC 80.900(22) in conjunction with the siting criteria for such facilities in 6 AAC 80.070 and with the coastal project questionnaire lends much credence to the Division's interpretation. The siting criteria for major energy facilities includes considerations of shipping routes, spills, and airborne emissions. [33] The coastal project questionnaire asks whether the applicant's project will require or include onshore or offshore oil facilities with an effective aggregate storage capacity of greater than 5,000 barrels of crude oil or greater than 10,000 barrels of non-crude oil (to which the Airport answered in the negative). The inclusion of the word major casts doubt on ACE's strict interpretation of the definition, since, contrary to ACE's protestations, its interpretation could include a facility that has a five-gallon propane tank for in-state energy use. [34] ACE's literal reading ... strains common sense. [35] At the least, the definition of major energy facility contains ambiguity, and when the meaning ... is ambiguous or in doubt, the [agency's] interpretation is entitled to great weight. [36] We therefore affirm the Division's interpretation of the major energy facility standard, as it is neither plainly erroneous nor inconsistent with the regulation.
ACE further maintains that the Office of Management and Budget has never adopted the Division's interpretation of the major energy facility standard as a regulation in accordance with the Alaska Administrative Procedure Act, AS 44.62. [37] The State argues that no additional regulation is needed to define major energy facility. Whether the agency action is a regulation is a question of law that does not involve agency expertise, so we apply our independent judgment. [38] The Division's interpretation of the standard does not satisfy the Administrative Procedure Act's definition of regulation, as it was not an amendment, supplement, or revision of a rule, regulation, order, or standard [39] so much as it was a common sense interpretation of the regulation's applicability. It neither provided new requirements nor made the existing ones any more specific. [40] The Division's interpretation was not an addition to a regulation involving requirements of substance. Instead, it was the interpretation of the regulation according to its own terms. [41] The Division's interpretation thus was not a regulation and did not need to be promulgated in accordance with the Alaska Administrative Procedure Act.