ML20148N059

From kanterella
Jump to navigation Jump to search
in Decision ALAB-506,ASLAB Denies TVA Claims That NEPA Did Not Expand NRC Jurisdiction,That NRC Staff Is Overstepping Bounds of Atomic Energy Act of 1954 Section 271 & That TVA, as fed-organized Util Is Excused from NRC Regs
ML20148N059
Person / Time
Site: Phipps Bend  Tennessee Valley Authority icon.png
Issue date: 11/09/1978
From: Duflo M
NRC ATOMIC SAFETY & LICENSING APPEAL PANEL (ASLAP)
To:
References
NUDOCS 7811220278
Download: ML20148N059 (33)


Text

_

d PUBLIC DOCUMENT ROOM --

UNITED STATES OF AMERICA -

99 NUCLEAR REGULATORY COMMISSION ATOMIC SAFETY AND LICENSING APPEAL BOARD "

  • Alan S. Rosenthal, Chairman Dr. John H. Buck OT
g6 p37" j 4 Richard S. Salzman b C "a$** **. * ** g SERVEa NOV 141978 y

)

In the Matter of )

)

TENNESSEE VALLEY AUTHORITY ) Docket Nos. 50-553

) 50-554 (Phipps Bend Nuclear Plant, )

Units 1 and 2) )

)

Messrs. David G. Powell and Justin M. Schwamm, Knoxville, Tennessee, argued the cause for the Tennessee Valley Authority, applicant; with them on the briefs were Messrs. Herbert S. Sanger, Jr.,

W. Walter LaRoche and William L. Dunker, Knoxville, Tennessee.

Mr. William B. Hubbard, Assistant Attorney General of Tennessee, Nashville, Tennessee, argued the cause for the State of Tennessee, intervenor; with him on the briefs was Assistant Attorney General William M. Barrick, Nashville, Tennessee.

Mr. Ballard Jamieson, Jr., Washington, D. C., filed a brief for the Council on Environmental Quality, amicus curiae.

Mr. Milton Grossman argued the cause for the Nuclear Regulatory Commission staff; Mr. Steven C. Goldberg on the briefs.

DECISION November 9, 1978 7811220278' (ALAB-506)

I.

The Tennessee Valley Authority has applied for

Commission 1/ licenses to build a two-unit nuclear power plant in Hawkins County, eastern Tennessee. TVA objects, however, to NRC's (1) undertaking an environmental cost-benefit analysis of the Phipps Bend proposal and (2) impos-ing license conditions designed to minimize the facility's adverse environmental consequences. Applicant's premise is that exclusive responsibility for taking these steps to implement the National Environmental Policy Act- !

resides with TVA itself. The staff and the State of Tennessee (an intervenor in this proceeding) disputed that reading of the law, and TVA sought a declaratory ruling from the Licensing Board to clarify the matter. The Board ruled against TVA, holding this Commission to have "a statutory obligation under NEPA to impose conditions designed to mitigate adverse environmental consequences on any permit or license it may issue to the Applicant in this case." LBP-77-14, 5 NRC 494, 498 (1977).

--1/ The Energy Reorganization Act of 1974 transferred the Atomic Energy Commission's responsibilities for regu-lating nuclear power to the Nuclear Regulatory Com-mission on January 19, 1975. 42 U.S.C. 85841(f).

" Commission" refers to the AEC or the NRC as the context requires. -

_2/ Commonly referred to by its acronym "NEPA", 42 U.S.C.

EE4321 et seg.

4 At TVA's request, the Licensing Board referred that

-~

3/

ruling to us. We in turn solicited the views of the Council on Environmental Quality (CEQ), which was created l by NEPA and is charged with monitoring federal agencies'

! compliance with that statute.--4/ CEQ responded by filing an amicus brief with us that supports the Licensing Board's decision. According to the Council, applicant's status as another federal agency provides "no basis for curtailing (this) Commission's responsibilities under NEPA."

The proceedings before the Licensing Board were completed while the referred question was pending before us. Consequently, Board decisions now authorize construc-tion of the Phipps Bend facility subject, however, to the

-~

5/

conditions designed to safeguard the environment. TVA did 'except to those conditions, but solely to preserve its legal position that the 15C may not impose them.--6/

3,/ See 10 C.F.R. 52.730 (f) .

4/ 42 U.S.C. 884342, 4344; National Helium Corp. v. Morton, 455 F.2d 650, 656 (10th Cir. 1971); Environmental Defense Fund v. TVA, 468 F.2d 1164, 1177-78 (6th Cir. 1972).

_5,/ LBP-77-60, 6 NRC 647 (1977)1 LBP-78-1, 7 NRC 73 (1978).

~~6/ The exceptions were taken to LBP-77-60, supra, which

~

dealt with environmental matters. Except to indi-cate that they were taken as a matter of caution to~ protect its jurisdictional position,.TVA filed .

no additional briefs or papers in suppert of them.

No otber exceptions were taken to LBP-77-60 and none to LBP-78-1..

1

The entire case is thus now before us. Accordingly, we shall both decide the jurisdictional dispute and perform the record review we normally undertake on our own initiative where cases are essentially uncontested.

II.

1. Background. A decision to license construction of a nuclear-powered electric generating facility is " major federal action" which may have significant consequences for the environment.--7/ For this reason (at least when the prospective licensee is not a federal agency) NEPA requires the NRC to determine whether there exist reasonable alter-

. natives to the utility's proposal less likely to harm the environment. If there are, the Commission must decide, in light of the costs and environmental benefits involved, whether the nuclear license should be awarded in the form 8/

proposed, modified in some manner, or rejected.

TVA is a congressionally-created corporation owned by 9/

the Federal government. Among its authorized undertakings

~~

7/ 42 U.S.C. E4 3 32 (2) (C) ; Scientists ' Institute for Public Information v. AEC, 481 F.2d 1079, 1088 (D.C. Cir. 1973);

Public Service Company of New Hampshire v. MRC, F.2d

, 2 CCH Nuc. Reg. Rep. 520,086 at p. 16,517 TI~st Cir.

T778) (certiorari petition pending) .

--8/ See, e.g., Boston Edison Co. (Pilgrim Station, Unit 2),

ALAB-479, 7 NRC 774, 778 (1978), and the authorities cited there.

_g/ Tennessee Valley Authority Act of 1933, section 1, 48 Stat.

58, as amended, 16 U.S.C. 5831.

e 9 is the provision of electric power in a multi-state segment of the southeastern United States. When TVA wishes to generate that power with nuclear plants, it, like any other utility, must get a Commission license. And indeed IVA'.has obEa-ined fortis, seeking NRC licenses for six nuclear power facilities in addition to the one at Phipps 10/

Bend how under consideration. ~~ With respect to these other facilities, TVA and the Commission reconciled

-- though sometimes with difficulty -- their respective 11/

NEPA responsibilities.-- In this case, however, a recon-ciliation could not be achieved outside the formal adjudi-catory process.

10/ Bellefonte, Browns Ferry , Hartsville, Sequoyah, Watts Bar and Yellow Creek.

11/ In 1971, TVA and AEC agreed that the former would serve as "' lead agency' with respect to the prepara-tion and circulation for comment of detailed environ-mental statements for applications for licenses for TVA nuclear power plants." Letter dated June 30, 1971, from Harold L. Price, AEC, to James E. Watson, TVA, (appended as Exhibit A to TVA's Brief Seeking Reversal of the Licensing Board's Order of February 28, 1977 (hereafter TVA's Opening Brief). Consistent with the notion of lead agency agreements, the arrangement provided for a contribution by Commission staff but gave TVA ultimate responsibility for preparation of the environmental impact statement (EIS). CEQ found the agreement to be in accordance with its then appli-cable guidelines. (See 40 C.F.R. 51500.7 (b) (1977 Rev. )

for CEQ's current guidelines on lead agencies.)

In two proceedings, EIS's prepared by TVA pursuant to the agreement were approved. Tennessee Valley Authority (Watts Bar, Units 1 and 2) , LBP-72-35, 5 AEC 230 (1972),

(FOOTNOTE CONTINUED ON NEXT PAGE)

6-

2. The parties' cositions. TVA acknowledges that

--11/ (FOOTNOTE CONTINUED FROM PREVIOUS PAGE) affirmed, ALAB-97, 6 AEC 37 (1973); and Tennessee Valley Authority (Sequoyah, Units 1 and 2), LBP-74-86, 8 AEC 999 (1974), affirmed, ALAB-261, 1 NRC 57 (1975). But in the next, Browns Ferry, the licensing board expressed concern that the agreement did not ensure that the staff would conduct the full " process of inter-disciplinary study, cost-benefit analysis, and weighing of alternatives prescribed by (NEPA] and by [ Commission regulations]."

Tennessee Valley Authority (Browns Ferry, Units 1, 2 and 3), LBP-73-29, 6 AEC 682, 685 (1973). The issue did not come before us on appeal because a few months before the Licensing Board's decision the agencies had dissolved their agreement in favor of a new pro-cedure: TVA would submit its own EIS with its applica-tion; the Commission would treat that EIS as the environ-mental report required of all applicants and would independently prepare its own EIS. See letter dated June 15, 1973 from L. Manning Muntzing to Lynn Seeber, TVA (appended as Exhibit D to NRC Staff Brief in Support of the Licensing Board's Referred Ruling of February 28, 1977 (hereafter Staff's Brief)). However, they followed this procedure only in the Bellefonte proceeding (see Tennessee Vallev Authority (Bellefonte Nuclear Plant, Units 1 and 2), LBP-74-66, 8 AEC 472 (1974)).

Since then TVA has filed applications to construct three nuclear facilities: Hartsville, Yellow Creek, and the Phipps Bend facility with which we are concerned here.

In Hartsville, TVA argued, as it does here, that NRC may not regulate nonradiological environmental aspects of TVA's plants. The Licensing Board rejected that assertion, Tennessee Valley Authority (Hartsville Plant, Units lA, 1B, 2A and 2B), LBP-76-16, 3 NRC 485, 493-96 (1976); the issue was not pressed before us. See ALAB-463, 7 NRC 341 (1978). In its decision in Yellow Creek authorizing issuance of a " limited work authorization",

the Licensing Board merely stated that it had responsi-bility for determining whether NEPA's requirements had been met and said it would base that determination ir part on TVA's Environmental Report and the staff's environmental statements. Tennessee Vallev Authority (Yellow Creek, Units 1 and 2), LBP-78-7, 7 NRC 215, 219 (1978). TVA raised a jurisdictional question (FOOTNOTE CONTINUED ON NEXT PAGE)

_7_

it is subject to NEPA's requirements.--12/ It contends, however, that it alone may make environmental determinations i

about the "non-rediological" aspects of a proposed nuclear power plant, even though it needs the NRC's permission to 13/

build the facility.--

The NRC staff is willing to accord due deference to TVA's environmental judgments. But, because Congress vested responsibility for licensing nuclear facilities in NRC, the staff asserts that NEPA makes the Commission ultimately responsible for assuring compliance with that statute's directives,which include determining whether a facility's benefits will outweigh all its environmental costs.

CEQ and Tennessee support the staff's position.

---11/ (FOOTNOTE CONTINUED FROM PREVIOUS PAGE) there only in connection with proposed license condi-tions that it thought were within the jurisdiction of the Environmental Protection Agency under the Federal Water Pollution Control Act Amendments of 1972, 33 U.S.C. E91251 et ~

seq., rather than NRC.

The Licensing Board agre d and modified some of the conditions. Id. at 229-31 (appeal pending).

Environmental Defense Fund v. TVA, 468 F.2d 1164 (6th

--12/

Cir. 1977); Duck River Preservation Ass'n v. TVA, 410 -

F. Supp. 758 (D . Tenn. 1974), affirmed, 529 F 7H 524 (6th Cir.1976) ;' Distributors Opposing Objectionable Rates v. TVA, __F.Supp.__, __,

, (N . D . Ala 1977).

--13/ TVA accepts that its NEPA compliance is subject to judicial review. See TVA Opening Brief at 33.

The environmental conditions incorporated at the staff's instance in the Phipps Bend construction permits appear neither unusual nor onerous, and TVA does not 14/

con' end that they are.-- The disagreement here is entirely jurisdictional. TVA is not concerned with whether NRC pre-i pares its own environmental impact statements (although it thinks this an unnecessary duplication of effort -- we deal with this aspect of the case infra, p. 26). But it insists that no matter how NRC assesses the non-radiological envi-ronmental costs and benefits of a proposed TVA nuclear facility, it may not override TVA's own judgment on these matters. TVA views the NRC as having transgressed the limits of its jurisdiction by freighting the Phipps Bend construction permit with environmental requirements.

TVA proffers a number of arguments for its position.

First, the agency contends that the NRC's Atomic Energy Act mandate is restricted to radiological health and 14/

~-

The license conditions for protection of the environ-ment are set out in a decision below at 6 NRC 671-72 (with appropriate references to the Final Environmental Statement for additional details). TVA has registered no specific objection to any of those conditions. It appears that, among other things, they contemplate NRC approval of certain transmission line corridors not yet finally selected. See  ? 94.5 and license condition (c) (ii) (1) at 6 NRC 67J.. .

_9_

cafety matters and that NEPA did not enla ge that juris-diction. Second, it argues that even if NEPA gave the Commission responsibility for avoiding all adverse envi-ronmental consequences at non-federal nuclear plants, Atomic Energy Act section 271, 42 U.S.C. E201% restricts the exercise of that authority over TVA facilities. Third, l

TVA says that its congressional charter affords it full and exclusive control over the disputed matters and that NEPA may not be used as a vehicle to impair its statutory independence in the environmental area. Finally, the assertion is made that TVA and not the NRC is the "respon-sible federal agency" for the Phipps Bend project and, therefore, has the final word on the cost-benefit analysis and any "non-radiological" environmental protection that NEPA may require.

The Licensing Board rejected all these arguments.

At TVA's urging, we reexamine each in turn.

1

3. The " environmental jurisdiction" of the NRC.

Prior to passage of NEPA, the Commission's authority was confined to radiological health and safety matters (together with national defense and antitrust considerations 15/

not involved here).-- TVA contends that NEPA did not expand the NRC's jurisdiction, tnat the license conditions designed to minimize the adverse environmental consequences of the Phipps Bend facility are thus impermissible, and that this 16/

ends the case.--

It is far too late in the day to be pressing that line 17/

of argument. Not only have we rejected it long previous--

18/ 19/ I but so have the Commission,-- courts of appeals-- and the

--15/ New Hampshire v. AEC, 406 F.2d 170 (1st Cir.), certiorari denied, 395 U.S. 962 (1969); Cities of Statesville v.

AEC, 441 F.2d 962 (D.C. Cir. 1969); Detroit Edison Co.

(Greenwood Energy Center, Units 2 and 3.' ALAB-247, 8 AEC 936, 938 (1974).

16/ See TVA Opening Brief at 19 and TVA Reply Brief at 11.

--17/ E.g., Greenwood, supra, ALAB-247, 8 AEC at 938; Pub 2ic Service Co. of New Hampshire (Seabrook Station, Units 1 and 2), ALAB-422, 6 NRC 33, 82-84, Commission review denied, CLI-77-22, 6 NRC 451 (1977) , af firmed sub. nom.

Public Service Co. of New Hampshire v. NRC, supra, fn. 7.

--18/ Kansas Gas and Electric Co. (Wolf Creek, Unit No. 1),

CLI-77-1, 5 NRC 1, 6-11 (1977).

19/

E.4., Public Service Co. of New Hampshire v. NRC, suora; Culpeper League v. NRC, 574 F.2d 633 (D.C. Cir. 1978);

Calvert Cliffs' Coord. Com. v. AEC, 449 F.2d 1109 (D.C. Cir. 1971).

.. _ . . - _ _ _ _ _ . _ _ _ _ _ _ _ _ _ _ _ _ .]

?

Supreme Court;SS! it also runs counter to the Council on Environmental Quality. guidelines.S1! 'The District of Columbia-Circuit put it concisely: "NEPA, first of all, makes environmental protection a part of the mandate of  ;

every federal agency'and department". Calvert Cliffs',

supra, 449 F.2d at 1112.- Consequently, as the First Circuit recently observed, " [t]he Commission is under a dual obliga-tion: to pursue the objectives of the Atomic Energy Act and those of the National Environmental Policy Act. 'The two l

statutes and the regulations promulgated under each must be viewed in pari materia.'" Public Service Co. of New Hampshire v. NRC, supra, F.2d at , 2 CCH Nuc. Reg. Rep. .

1 220,086 at p. 16,521, quoting'from Citizens for Safe Power

v. NRC, 324 F.2d 1291, 1299 (D.C. Cir. 1975) (emphasis in orig-inal). Accordingly, where the environment must be guarded  ;

from the adverse effects of nuclear plants -- even from their >

non-radiological consequences -- this Commission has stressed '

that it may "where necessary impose license conditions to I

minimize those impacts." Wolf Creek, supra, fn. 18, CLI-77-1, 5 NRC at 8 (involving connecting roads and railroad 20/_ Vermont Yankee Nuclear Power Corp. v. NRDC; 435 U.S.

519 (1978); accord, Kleppe v. Sierra Club, 427 U.S.

390, 409-_(1976). ,

21/ 40~C.F.R. 91500. 2 (b) .

l i

, y.,-- -,rr --

/

. i spurs).

This Board is, of course, bound to follow the Commis-sion's holding in Wolf Creek. But even were we writing on a l clean slate, TVA's contrary position would not be well taken.

The agency relies on five court decisions that purportedly 1 l

put to rest the question of NEPA's expansionary effect.

Those cases do examine the relationship between NEPA and pre-existing authority, but the discussion in the margin 22/

shows that none is analogous to the instant proceeding.--

The Supreme Court's SCRAP decision, for example, while stating 22/ See TVA's Opening Brief at 20-21 and TVA's Reply Brief at 10-15. The cases are: United States v. SCRAP, 412 U.S. 669 (1973) (NEPA did not amend or repeal a stat-utory provision of Interstate Commerce Act so as to restore federal courts' power temporarily to suspend railroad rates, even in the absence of compliance with section 102 of UEPA); Kitchen v. FCC, 464 F.2d 801 (D.C. Cir. 1972) (Where Communications Act expressly l precluded FCC jurisdiction over local telephone exchange building, the agency was held without authority to assure  !

that its construction met NEPA requirements) ; Gaae v.

AEC, 479 F.2d 1214 (D.C. Cir.1973) (petition for review of AEC environmental requiations dismissed for lack of jurisdiction; in dictum on question of AEC construction permit as prerequisite for land acquisition that might or might not be devoted to nuclear purposes, court noted that NEPA does not mandate action beyond agency's l organic jurisdiction); Gifford-Hill & Co. v. FTC, 523 F.2d 730 . (D.C. Cir.1975) (FTC initiation of adjudica- j tory process pursuant to antitrust authority was not "maior Federal action" within meaning of section 102 of NEPA); and Edwards v. First Bank of Dundee, 534 F.2d 1242 (7th Cir.1976) (no federal involvement --

and therefore no NEPA obligations -- in state bank's proposed demolition of privately-owned building that petitioners wanted preserved).

that "NEPA was not intended to repeal by implication any 23/

~-~

other statute", does so in the context of holding that NEPA had not "sub silentio revived judicial power that had been explicitly eliminated by Congress".--24/ The Court in SCRAP made essentially two points: first, compliance with NEPA is excused where directly preclut by another federal statute; second, where tne encity lacks the power to act in a particular manner q., to grant injunctive relief) , NEPA does not furnish it. The NRC, however, indisputably possesses the right to grant conditional licenses and con-struction permits and no enactment forbids the use of that authcrity to implement the. purposes of NEPA.

In Kitchen, as the District of Columbia Circuit (which authored the decision) explained in a later case, "the agency possessed no jurisdictional toehold" -- and hence no envi-26/

ronmental grasp -- on the proposed action;-- the same was true in Edwards. Gifford-Hill involved an action within the 23/ 412 U.S. at 694.

24/ Id. at 696.

25/ Id. at 695 fn. 20. Accord, Calvert Cliffs', supra,

~~

TT9 F.2d at 1115.

26/ Henry v. FPC, 513 F.2d 395, 407 fn. 33 (D.C. Cir. 1975).

l l

  • i

-114 -

agency's authority but outside NEPA's scope, and Gage 1 27/

merely reminded us in dictum of NEPA's limitations.~~

! These cases hold that NEPA does not make federal s

agencies guardians of the environment regardless of the discrete roles Congress has otherwise assigned them. But they do not call for the rigid, crabbed reading that TVA 3 urges. Indeed, to hold now that the NRC still may not i

consider all the environmental consequences of nuclear

{ power plants in deciding whether to license them would i

be to flout both the statutory directive that, "to the i

fullest extent possible, * "

  • the public laws of the United States shall be interpreted and administered in j i accordance with (NEPA)," 42 U.S.C. 54332, and the First Circuit's explicit holding that NEPA provides the congressional mandate to j force " timely and comprehensive consideration

! of non-radiological pollution effects in the planning of installations", which was previously

missing (citations omitted) .28/

Moreover, as we mentioned, none of the decisions i

! relied on by TVA adequately reflects-the case before us.

i NRC clearly has jurisdiction over the "res" here -- the 27/ Cf. Wolf Creen, supra, CL1-77-1: "The acquisition of

-~

land, which was the subject of challenge in Gage v.

AEC, *** , would appear to be an activity which would not require advance Commission approval". 5 NRC at 11 (citation omitted).

28/ Public Service Co. of New Hampshire v. NRC, suora, 2 CCE' Nuc . Reg . Rep.120,0 86 at p . 16,517 fn . 6.

l i

g nuclear facility that TVA wants to build and operate.

Indeed, building that plant without a Commission license l 30/

would be unlawful.

-~

And, to reiterate, NEPA indisputably embraces the Commission's licensing process in cases involving non-Federal applications. In those proceedings -- the usual proceedings -- NRC can and must take actions to comply with NEPA. Our task, then, is to determine not whether the Commission's authority extends to environmental concerns, but whether it extends to TVA's application. In relying on the decisions discussed above. TVA does not help its cause on that question. ,

4. The application of Atomic Energy Act section 271.

In rejecting TVA's broad initial contentions, however, we have not resolved the next point in the applicant's argu-ment: that the staff is overstepping jurisdictional bounds laid down in the Atomic Energy Act itself. Section 271 of j that statute, as amended, 42 U.S.C. 2018, provides that Nothing in this Act shall be construed to affect the authority of any Federal, State of local agency with respect to the generation, {

29/ Once again,we may analogize this proceeding to Henry, supra, where the court distinguished the FPC's " plain jurisdiction" over projects at issue there from the FCC's lack of jurisdiction in Kitchen. 513 F.2d at 407 fn. 33.

30/ Greenwood, supra, 8 AEC at 938.

L 1 ..

16"-

sale, or transmission of electric power pro-duced through the use of nuclear facilities licensed by the Commission: Provided, that this section shall not be deemed to confer upon any Federal, State, or local agency any authority to regulate, control, or restrict any activities of the Commission. (Emphasis added. )

TVA reads section 271 as "preclud[ing] NRC from claim-ing regulatory authority over the generatior., sale, or 31/

transmission of electricity produced at a TVA nuclear plant."---

It argues that the provision means that the NRC may take cognizance only of tnose environmental aspects of a TVA nuclear power facility that are related to radiological 32/

nealth and safety.

The Board below rejected that argument. It held section 271 not to limit the NRC's authority to condition its license ih furtherance of MEPA, but merely to preserve whatever preexisting regulatory jurisdiction other federal, state and local agencies may have possessed over electric 3/ TVA's Opening Brief at 21.

32/

TVA also points to 10 C.F.R. E50.10 (e) (2) , which estab-lishes that a construction permit may be issued only after all necessary findings have been made and the proposed site has been deened suitable "from the stand-point of radiological health and safety considerations" pursuant to the AEA and the Commission's rules and regulations. TVA sees this as limiting the class of considerations.over which NRC has authority. But the regulation must ride the coattails of the statute:

if the statute grants NRC authority over issues not strictly " radiological," then the regulation may not nullify it; if the statute grants no such authority, then the regulation adds nothing. .

i j

power generation and distribution. 5 NRC at 498. We agree.

We need not dwell on the point, for it is made quite clear by both Congressional and judicial actions. In 1965, e the' Ninth Circuit construed section 271 to bar the United .

States from condemning a right of way for power lines to i serve.an AEC project in the face of objections by local zoning authorities. Maun v. United States, 347 F.2d 970.

The court of appeals' decision rested on its reading of section 271, which did not then include the proviso. Congress immediately overturned the Maun decision by adding that proviso, together with the clause to the first sentence of 33/

section 271 noted in the margin.-~

As the House committee report on the amendatory lecis-lation. explained, Congress initially included section 271 in the Atomic Energy Act to quell " uneasiness among the drafters of the legislation over the effect of the lAEA]

33/ Pub. Law 89-135 (79 Stat. 551) (1965). The legislative .

~~

history of the amendment is at H.R. Rep. No. 567, 89th Cong., 1st'Sess. (1965), reprinted in 1965 U.S. Code Cong. & Ad. News 2775. The clause added to the first ,

(and only. other) . sentence of section 271, was as follows l (added phrase underscored) : "Nothing.in tnis Act shall ]

be. construed to affect the autnority or regulations of  !

any Federal, State, or local agency with respect to J the generstion,, sale, or transmission of.elsc6ric. cower i

'aroduced through the use of nuclear facilities licensed

ay the Commission." The proviso is quoted in italics in the text at pp. 15-16, supra. i 1

. l 34/

upon other agencies"-- and.

to make it explicit that licensees of the AEC who produced power through the use of nuclear  ;

facilities would otherwise remain subject to l the authority of all appropriate Federal, State and local authorities with respect to the genera- l tion, sale, or transmission of electric power.35/

The Maun court, however, had held that section 271 removed the Commission's own sovereign immunity with regard to local control over such matters and, in so doing, upheld actions of a California county and town hampering an AEC research  !

1 and development project. Seeing a need to dispel such notions and their application, Congress acted swiftly to 36/

" reaffirm a conclusion already implicit in the [AEA]."~~

~

The Eouse committee report states unequivocally that the purpose of the 1965 amendment was to clarify-the language of section 271 so as to correct any such erroneous conclusion that Congress intonded that AEC's activities, as  !

authorized by Congress, be limited by the I authority or regulations of local authorities with respect to the generation, sale, or trans-mission of electric power. It would accord-ingly reaffirm the intent of Congress that AEC possess the same sovereign immunity, under the supremacy clause of article VI of the Consti-tution, that other Federal agencies posq Thisisthema]orpurposeofthisbill' gps. l l

34/ 1965 U.S. Code Cong. & Ad. News at 2 7 '/ 9 .

35/ Ibid.

36/ Id. at 2784.

37/ In. at 2780.

l In other words, as the First Circuit has observed, Congress meant section 271 to be nothing more than "a garden variety 38/

-~~

nonpreemption clause."

Although TVA recognizes that Congress enacted the amendment to overturn Maun and prevent similar misreadings of section 271, it seems not to have appreciated the thrust of the amendment's legislative history, namely, that the language added in 1965 did not alter the meaning of that section. The intent of both the original and the amended sections was to preserve jurisdiction in all quarters, not to restrict it in the Commission's quarter alone. In re-jecting arguments akin to those TVA urges her'e -- that section 271 precludes NRC from exercising jurisdiction i

over transmission lines -- the First Circuit explained:

Petitioner's flawed interpretation can perhaps l Lest be exposed by extending its reading to the

! entire section, and not just to the word "trans-l mission." If we were to adopt petitioner's position that section 271 operates as a positive bar, then it must perforce extend to the entire section, viz., the Commission is also barred from

~~'38/

Public Service Co. of New Hamoshire v. NRC, supra, 2 Nuc. Reg. Rep. 520,086 at p. 16,520; cf., Portland General Electric Co. (Pebble Springs, Units 1 & 2),

CLI-76-27, 4 NF.C 610,614 fn. 5 (1974).

maintaining jurisdiction over the generation or sale of electricity. Since commercial nuclear power plants' raison d'etre is to generate electricity and since they are constructed to perform this function, peti-tioner's strained reading of section 271 would mean that the Commission is barred from any exercise of jurisdiction over the very plant itself. We think this result demonstrates the fundamental error in

[ petitioner's] interpretation.39/

For the reasons spelled out above and elucidated by the First Circuit, we hold that the Board below correctly construed section 271. The provision does not prevent the NRC from including in TVA's licenses to construct nuclear generating plants conditions designed to minimize their adverse environmental effects. We turn then to the agency's next argument, which is that TVA's status as an independent federal agency precludes the Commission from imposing such license conditions.

~~39/ Public Service Co. of New Hampshire v. NRC, supra, 2 CCH Nuc. Reg. Rep 220,086 at p. 16,520 (emphasis in original).

5. TVA's " exclusivity" argument. As is the case with a privately-owned utility, TVA must obtain a Commission license to build and operate nuclear-powered generating facilities.AS/ The draftsmen of the Atomic Energy Act were unequivocal "that Government agencies are on an equal footing with all others before the Commission with respect to obtaining licenses from the Commission * * *".AS/ It is not disputed here that, as used in the Act, " government agency" embraces TVA.12/ In other words, in framing the Commission's basic charter, Congress specified that the l

same license requirements were to govern government and private applicants alike.

NEPA added to the Commission's original responsibil-ities in the sense that it must now consider and act to 40/ See section 273 of the Atomic Energy Act of 1954, as

~~

amended, 42 U.S.C. 82020, " Licensing of Government Agencies".

41/ H.R. Rep. No. 2639, 83rd Cong., 2nd Sess. (1954) (con-

~~

ference report) at 46.

42/ Section 103 (a) of the Act, 42 U.S.C. 52133 (a) , author-

~~

izes the issuance of licenses for commercial power reactors to " persons"; section ll(s), 42 U.S.C. E2014(s),-

defines persons to include a " government agency," which is further defined in section 11(1) , 42 U.S.C. 52014(1),

to encompass, inter alia, a corporation owned by the United States. TVA is such a corporation. See fn. 9, supra. The possibility of TVA obtaining Commission licenses was expressly contemplated in the debates on the Act. See, e.g., 100 Cong. Rec. 10742 (July 21, 1974)

(remarks of Sen. Humphrey).

prevent or minimize the adverse environmental as well as radiological consequences of the facilities it licenses.

And, for the reasons we have explained, neither the Atomic Energy Act in general nor section 271 in particular bars the inclusion in licenses for government-owned plants of conditions designed to achieve such results.f3/ TVA insists, however, that those conditions may not be included in its nuclear licenses because Congress alone has "the power to oversee TVA" in the absence of legislative direc-tion to the contrary. The NPC's assertion of that authority, says the agency, rests on a reading of NEPA that " conflicts with the TVA Act and must give way."AA! These arguments are bottomed on statutory provisions giving TVA, among other things, " exclusive * *

  • control" of its property and operationsA5/ and on pre-NEPA decisions like U.S. ex rel.

TVA v. WelchA5! holding that TVA has always had a special statutory obligation to protect the human environment.

43/ See pp. 9-19, supra, 44/ See TVA Opening Brief at 6-7, 16 and 28.

--45/ See, e.g., section 2(g) of the TVA Act, 16 U.S.C.

9831a(g), which provides that the TVA board of directors shall direct the exercise "of all the power of the corporation."

46/ 327 U.S. 546, 549 (1946).

The question we must therefore address is whether the NRC is excused from carrying out its usual NEPA obligations because the license applicant is TVA. NEPA, however, is a later enactment than the statutes relied upon by TVA, and section 102 of NEPA directs "all" federal agencies to comply with its requirements "to the fullest extent pos-sible."A1/ The leading authorities teach that an agency is excused from those NEPA duties only "when a clear and 1

unavoidable conflict in statutory authority exists."

Concerned About Trident v. Rumsfeld, 555 F.2d 817, 823 (D.C. Cir. 1977); accord, Flint Ridge Development Co. v.

Scenic Rivers Ass'n, 426 U.S. 776, 788 (1976). Attempts to construe that section narrowly to limit activities sub-ject to NEPA have not met with judicial favor, as the applicant is undoubtedly aware. "Section 102 exempts agencies from compliance only when other statutory authority under which the agencies are proceeding expressly precludes compliance." Environmental Defense Fund v. TVA, supra, 468 F.2d at 1176 (per McCree, J.) (emphasis supplied). The CEQ Guidelines mirror that understanding (50 CFR al500.4 (a)) :

47/ 42 U.S.C. 54332.

. . s The phrase "to the fullest extent possible" in section 102 (of NEPA) is meant to make clear that each agency of the Federal Govern-ment shall comply with that section unless existing law applicable to the agency's operations expressly prohibits or makes compliance impossible.

TVA's position boils down to this: it desires to ful-fill its mandate to provide electricity by employing nuclear power reactors, and it wants the Commission to ignore some of the environmental costs in considering its applications to build and operate those reactors. But as the Board below pointed out, TVA does not and cannot rely on specific language in the Tennessee Valley Authority Act of 1933 in claiming " exclusive" authority over the environ-mental decisions at issue here: that statute, quite simply, contains no such language.38/ Nor could that Act alone answer the particult.r question before us, for it long antedates both the Commission's regulatory authority over i

nuclear power and the enactment of NEPA itself. TVA has shown us nothing in its own (or any other) statute that

" expressly prohibits or makes compliance impossible" inso-far as NRC environmental review of all aspects of a TVA license application is concerned.

48/ See 5 NRC at 495-96.

But even accepting arguendo everything TVA tells us about its statutory " independence," its status for other purposes neither authorizes its construction and operation ,

of nuclear power facilities sans Commission approval nor permits the NRC to license such projects in disregard of its own NEPA responsibilities. The kind of statutory con-flicts which exc.,use NEPA compliance arise where the respon-sible agency-is itself forbidden to act as NEPA might otherwise demand (the situation in SCRAP, supra) or where following NEPA's procedures would directly frustrate the .

agency's ability to carry out its specific statutory responsibilities, the case in Flint Ridge Development Co.,

supra (Secretary of Housing and Urban Development need not prepare impact statements on Interstate Land Sales Full Disclosure Act registration statements when impossible to do so within the statutory time allowed for reviewing them). Circumstances analogous to those simply are not present here. Even assertions that "NEPA cannot possibly apply" to strategic military decisions have been rejected by the courts. Concerned About Trident v. Rumsfeld, supra.

To the extent that NRDC v. Callaway, 524 F.2d 79 (2nd Cir. 1975), relied on by TVA, is relevant here, the deci-sion cuts against the agency's position. The case holds

._m_ - _ _ _ _ _ _ _ _ _

1 1

that the federal agency with the overall responsibility  !

1

, for a project may be designated " lead agency" and prepare l

. the necessary NEPA impact statement. But it does not hold  !

that the other agencies must accept the lead agency's l environmental analysis; indeed, it suggests just the 4

l opposite. While the issue was not directly litigated, 4

the court of appeals' opinion reveals that the lead agency --

the Navy -- was forced to bow to the judgment of the Corps t of Engineers (from whom it needed a permit) about where to dump certain dredged spoil. See id. at 90-91. TVA's

} scope.for independent action is hardly broader than the j 49 t Navy's.- /

I

The Licensing Board observed that " Congress has not specifically addressed the situation in NEPA, the TVA Act, or elsewhere, in which the TVA is seeking a license from i

another Federal agency having its own independent NEPA 4

responsibilities." bI It concluded that " Congress did not intend TVA jurisdiction to be inviolable" in such a situa-tion and that, therefore, "no impermissible statutory ,

1 conflict" exists.3 !

3 43_/ Levinson'v. Spector Motor Service, 330 U.S. 649 (1947),

relied on by TVA, manifestly does not deal with the proper implementation of NEPA (1969).

SjL/ 5 NRC at.497. ,

a 51/ Ibid.

____.-_m

We agree. As far as Congressional directives are concerned, the issue of TVA exclusivity is a blank slate.

But TVA has been at odds with the Commission over this NEPA issue for more than five years.5 ! If anything is to be drawn from Congressional inac' tion in these circum-stances, it is that Congress has had opportunity to take action manifesting TVA's exclusive authority in the situa-tion and it has not done so.!3/

Not having been instructed otherwise by the legis-lature, we must heed the rule generally applicable for major federal action in which two (or more) agencies are involved. That rule is not that one of them must yield up its NEPA duties to the other. Rather, it is the converse:

52/ See fn. 11, supra, and accompanying text.

53/ To the contrary, Congress has in the interim curtailed TVA's freedom of action with other environmentally protective legislation. For example, the Endangered Species Act, 16 U.S.C. 981531 et seq., administered by the Secretary of the Interior, has been invoked successfully to enjoin construction of the Tellico Dam, a multimillion dollar TVA project, the Chief Justice specifically observing that "it is clear Congress foresaw that 57 [of the Act) would, on occa-sion, require agencies to alter ongoing projects to l fulfill the goals of the Act." TVA v. Hill, 437 U.S.

l , ,

57 L.Ed. 2d 117, 141 (T778).

l t

both must evaluate the environmental consequences of the entire project and both must determine independently whether NEPA has been satisfied. Silentman v. FPC, 566 F.2d 237, 240-41 (D.C. Cir. 1977); Henry v. FPC, supra, 513 F.2d at 406-7 (per Leventhal, J.); cf., NRDC v.

Callaway, supra.

Henry is particularly instructive. The case involved a proposal to manufacture, transport and sell synthetic gas derived from coal. The approval of several agencies was needed to complete this " coal gasification" project, the Federal Power Commission among them. The " lead agency" for NEPA purposes was the Department of the Interior's j Bureau of Reclamation. The FPC's interest in the project stemmed from its jurisdiction under the Natural Gas Act i l

over the interconnections needed to introduce the synthetic I gas into pipelines transporting natural gas, a relatively small part of the overall proposal.

The FPC's contentions in Henry parallel those TVA 1

makes here about the NRC's authority. The FPC argued that 1

it was not called upon under NEPA to evaluate the costs and I l

benefits of the entire project, but only those involving l l

1 I

l 29 -

the segment under its jurisdiction in deciding whether to license the latter. The District of Columbia Circuit flatly rejected that approach as inconsistent with NEPA.

While the court of appeals agreed that the FPC need not prepare its own impact statement on the project but could l

" rely on the statement prepared by the lead agency," the court made unmistakably plain in Henry that (513 F.2d at 407):

What is required is that the FPC, in deciding whether to grant, deny, or condition certifi-cates of public convenience and necessity for admittedly jurisdictional facilities, take into account the environmental costs of the gasification projects as a whole. It may do this by accepting, rejecting or modifying the ana,1ysis of the lead agency (emphasis supplied).

And last year, in Silentman, the District of Columbia Circuit expressly reaffirmed its holding in Henry. The court ruled that "it is impermissible for any one agency to avoid addressing the environmental consequences of an entire federal project because its own involvement was small." It reiterated that, even under a " lead agency" arrangement, each agency involved must reach independent environmental conclusions "by accepting, rejecting or modifying the analysis of the lead agency" and then taking whatever action is appropriately called for by them in light of that judgment. 566 F.2d at 240-41.

Our reading of NEPA's requirements accords with the early " lead agency agreements" between the Commission and TVA. These were expressly construed by CEO as mandating the Commission's " independently weighing the benefits and costs discussed in the final (TVA] statement and reaching an independent conclusion as to the appropriate licensing action, if any, in light of environmental considerations".5A/

This hardly means that lead agency agreements serve no useful purpose. To the contrary, as the reported cases amply illustrate, they have demonstrated their utility in numbers of other instances where more than one federal agency was involved in a project. Appropriately cast and implemented, such an agreement between TVA and this

--54/ See letter of October 9, 1973 from the General Counsel of CEQ to Mr. Muntzing, then AEC Director of Regulation (appended as Exhibit "B" to TVA's Opening Brief). The Commission decision in Project Management Corp. (Clinch River Breeder Reactor Plant), CLI-76-13, 4 NRC 67 (1976), is not to the contrary. That case involved the unique circumstance of Congress directing the Energy Research and Development Administration to develop a demonstration breeder reactor under license from the NRC. The Commission accepted the need for a demonstration " breeder" as a given, but held itself bound under NEPA to evaluate the environmental costs and benefits of ERDA's specific proposal -- including whether another type of facility or a different plant site might be a preferable alternative. With far less Congressional authority behind its proposal, TVA would have the NRC conduct a much more restrictive NEPA review. To the extent that Clinch River bears at all on this case, it calls for rejection, not acceptance of TVA's position.

4 Commission could well avoid unnecessary duplication of effort, not only in the identification and in the analysis of the environmental effects attendant upon the construc-tion and operation of. additional'TVA nuclear facilities, but also in their mitigation. Whether TVA contemplates a further expansion of.its nuclear generating capacity is unclear. If it does, however, there appears to be good reason why it and the staff should try their hands at drafting a new agreement in light of the recent judicial pronouncements clarifying NEPA jurisprudence in this area.

In closing, we note that TVA sought to frame the issues in terms of NRC attempts to " overrule" TVA's board of directors on questions of "need for power" and electric rates. There is no occasion for us to discuss those issues a.t length because there is no dispute about those matters in this case. It suffices to observe that we are unaware of any instance in which the Commission has ever invoked NEPA to regulate electric power rates,E5! and that 55/ More particularly, there is nothing in the record to suggest that the staff was' proposing the imposition of a condition upon the Phipps Bend permits which might have a bearing upon what TVA might charge for its electricity. Although.NRC adjudicatory boards have the authority to grant declaratory relief to remove uncertainty or to avoid delay (Kansas Gas & Electric Co.

(Wolf Creek Nuclear Generating Station, Unit No. 1) ,

CLI-77-1, 5 NRC 1 (1977)), there is no occasion to (FOOTNOTE CONTINUED ON NEXT PAGE)

(-

our decisiens reflect the Commission policy of " heavy reliance" on the judgment of those responsible for assur-ing adequate electric service in deciding whether power to be generated by new facilities is needed.55!

In short, the actual areas of disagreement between the TVA and NRC staffs here are small ones; for the most part, the two have seen eye-to-eye on environmental matters.

The license conditions in question essentially direct TVA to (1) monitor its Phipps Bend construction operations, (2) be alert to the possibility of unforeseen circumstances arising that could affect the environment unfavorably, and (3) if such do arise, consult with NRC in devising appro-priate solutions. See fn. 14, supra. As we indicated at the outset, TVA does not challenge their substantive requirements. Ibid. We believe that the officials involved in constructing this project will not be unduly hampered in their tasks with them continuing in force.

--55/ (FOOTNOTE CONTINUED FROM PREVIOUS PAGE) invoke that authority to resolve purely hypothetical questions which appear unlikely to arise in a concrete setting. Put another way, there will be time enough to address the matter when and if'TVA is ever confronted with an actual endeavor to have this Commission exercise dominion over its rates.

--56/ Rochester Gas and Electric Corp. (Sterling, Unit No. 1),

ALAB-502, 8 NRC (slip opinion at 4-8) (October 19, 1978, and cases there cited.

O i

l l

III. l l

In addition to our consideration of the jurisdictional l issue raised by TVA, we have reviewed on our own initiative ]

the remainder of the two Licensing Board decisions before us. See fn. 5, supra. Leaving aside the question of the j environmental effects of radon emissions attributable to l 1

the mining and milling of uranium, we have encountered no l errors warranting corrective action. Final disposition 1

of the radon issue must, however, abide the event of the I completion of the procedures for dealing with that issue which are outlined in ALAB-480, 7 NRC 796 (1978). '

l l

l The referred ruling (LBP-77-14, 5 NRC 494) is affirmed. i 1

Also affirmed on all issues but radon are LBP-77-60, 6 NRC l 647, and LBP-78-1, 7 NRC 73. Jurisdiction over the radon issue is retaine,d.

It is so ORDERED.

- FOR THE APPEAL BOARD dst Y h l>J Margaret E. Du Flo Secretary to the Appeal Board