Opinion ID: 185919
Heading Depth: 2
Heading Rank: 2

Heading: The License Amendment Proceedings

Text: 5 Located on the Tallapoosa River in central Alabama, Alabama Power's Martin Dam Project has the capacity to generate 154.2 megawatts (MW) of electric power. The dam project generates electricity by taking in water from the reservoir above the dam, funneling the water through four turbine generators and then releasing the water through four penstocks into the river below the dam. The first three 33-MW turbine generators began commercial operation in 1927. Alabama Power added a fourth, 55.2 MW generator in 1952. Although FERC originally licensed the Martin Dam Project in 1923, it issued a new 40-year license to Alabama Power in 1978. 6 On December 22, 2000, Alabama Power filed an application with the Commission to amend its license to authorize the replacement of the three 33-MW turbine generators. These units had exhibited serious leakage problems and efforts to repair them had been largely unsuccessful. According to Alabama Power's estimates, the replacement turbines would increase the flow of water into the river below the dam project by approximately 900 cubic feet per second (cfs), an increase of 8.6%, and would increase each generator's capacity by 7 to 10 MW, an increase of roughly 20-30%. 7 Shortly after the Commission provided public notice of Alabama Power's license amendment application, the petitioners moved to intervene, arguing that section 401(a)(1) of the CWA required Alabama Power to obtain state water quality certification before the Commission could amend its existing license. On May 23, 2001, the Commission issued an order approving Alabama Power's proposed license amendment. Ala. Power Co., Project No. 349-070, Order Amending License, 95 F.E.R.C. ¶ 62,156, 2001 WL 541354 (May 23, 2001) ( Order Amending License ). In doing so, the Commission rejected the petitioners' argument that the license amendment required state water quality certification under section 401(a)(1), concluding that [r]eplacing and upgrading the existing turbine-generator units is not an `activity which may result in a discharge' within the meaning of [s]ection 401(a)(1). Id. at 64,220. 8 While the Commission recognized that replacement of the turbine generators would increase the [dam] project's hydraulic capacity, with the result that water would be discharged more quickly [into the river], it found that the nature of the discharge would not change, i.e., that water from the reservoir would continue to be released through the new turbine generators in essentially the same manner as it is now released through the existing turbine generators. Id. Reasoning that section 401(a)(1) requires certification only for `activities which may result in a discharge,' not activities which may alter an already existing discharge, the Commission held that section 401(a)(1) did not apply to Alabama Power's amended license. Id. (citing North Carolina v. FERC, 112 F.3d 1175, 1188 (D.C.Cir.1997), cert. denied, 522 U.S. 1108, 118 S.Ct. 1036, 140 L.Ed.2d 103 (1998)) (emphasis in original). 3 9 The Commission's Order Amending License likewise rejected the petitioners' argument that 18 C.F.R. § 4.38(f)(7)(iii) required Alabama Power to obtain state water quality certification for its proposed license amendment. Id. Section 4.38(f)(7)(iii) provides that any application to amend an existing license ... requires a new request for water quality certification ... if the amendment would have a material adverse impact on the water quality in the discharge from the project. 18 C.F.R. § 4.38(f)(7)(iii). Citing its environmental assessment of the proposed license amendment, the Commission concluded that the proposed modifications to the three 33-MW turbine generators would not have a material adverse effect on the water quality of the dam project's discharge. Order Amending License, 95 F.E.R.C. at 64,220. Accordingly, the Commission held that section 4.38(f)(7)(iii) did not require Alabama Power to obtain state water quality certification in applying to amend its existing hydroelectric license. Id. 10 The petitioners moved for rehearing. On July 23, 2001, the Commission denied the motion, again rejecting the argument that section 401(a)(1) required Alabama Power to obtain state water quality certification for its proposed license amendment. Ala. Power Co., Project No. 349-078, Order Denying Rehearing, 96 F.E.R.C. ¶ 61,096, 2001 WL 826131 (July 23, 2001) ( Order Denying Rehearing ). Relying on North Carolina v. FERC, 112 F.3d 1175 (D.C.Cir.1997), the Commission explained that section 401(a)(1) applies only to activities that may `result in a discharge,' not to those activities that simply alter an existing discharge, Order Denying Rehearing, 96 F.E.R.C. at 61,386. Alabama Power's license amendment did not trigger the certification requirements of section 401(a)(1), the Commission reasoned, because replacement of the existing turbine generators will at most alter an existing discharge by increasing the amount of water flowing through the units at any given time and, concurrently, reducing the amount of time that the units will operate each day. 4 Id. 11 Noting that all construction would be completed within the existing structures of the dam project as well as in the dry, the Commission dismissed the petitioners' argument that replacement of the turbine generators would result in a discharge of dust, grease and oil. 5 Id. at 61,386-87. The Commission rejected the notion that removal of the old turbine generators could result in any such discharge and, in addition, concluded that the possible release of trace amounts of dust or grease during the initial installation of the new turbine generators was an insufficient basis to conclude that the replacement would result in a discharge requiring certification under section 401(a)(1). 6 Id. at 61,387. We now review the Commission's orders.