Opinion ID: 2735161
Heading Depth: 3
Heading Rank: 3

Heading: Alcoa v. BPA

Text: After PNGC II issued, BPA entered into yet another contract with Alcoa, one that we upheld. See Alcoa, 698 F.3d at 782–85, 796. Although not directly implicated in this appeal, this final Alcoa-BPA contract merits some brief discussion, to complete the story of BPA’s efforts to assist the aluminum DSIs. 16 ICNU V. BPA Under this latest contract, BPA agreed to sell physical power to Alcoa at the cost-based IP rate for a modest profit (projected at $10,000 for the contract’s initial, roughly 18month period). Id. at 783. BPA’s preference customers again mounted a challenge, arguing that instead of selling to Alcoa at the cost-based IP rate, BPA should focus on selling to other customers, whom it can charge higher market rates. Id. at 785. In the preference customers’ view, BPA’s failure to maximize its profits demonstrated that it “[was] not acting according to a profit-making purpose,” but rather was still attempting to “subsidiz[e] Alcoa . . . so as to preserve jobs at its smelting plant and the surrounding community.” Id. at 788–89. In Alcoa, we rejected these challenges, explaining that the “sound business principles” mandate does not mean “that BPA is required to maximize its profits.” Alcoa, 698 F.3d at 789. To the contrary, BPA has wide discretion as to how best to pursue its businesslike role while also complying with other statutory mandates, such as environmental protection. Id. Applying the high level of deference owed to BPA’s business decisions, we allowed the most recent Alcoa-BPA contract to stand, noting that: (1) unlike the monetized energy contracts at issue in PNGC I and PNGC II, it provided only for physical power sales; (2) it was expected to yield some profit to BPA, albeit modest; and (3) there was no record evidence to support the preference customers’ speculation that BPA’s decision was motivated by concerns about job losses. Id. Therefore, we concluded, we had to “defer to BPA’s determination” that its power sale to Alcoa comported “with sound business principles.” Id. ICNU V. BPA 17