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Entergy Final Brief
	ML12152A106
Person / Time
Site:	Vermont Yankee File:NorthStar Vermont Yankee icon.png
Issue date:	03/19/2012
From:	Doris Lewis, Martin K, Zoli E; Entergy Nuclear Operations, Goodwin Procter, LLP, Pillsbury, Winthrop, Shaw, Pittman, LLP
To:	; NRC/OGC, US Federal Judiciary, US Court of Appeals for the District of Columbia Circuit
	Croston, Sean
References
	USCA Case #11-1168, 11-1168, 11-1177, 364259
	Download: ML12152A106 (103)
	v • d • e

ORAL ARGUMENT SCHEDULED FOR MAY 9, 2012 IN THE UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT

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Nos. 11-1168 and 11-1177, consolidated

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VERMONT DEPARTMENT OF PUBLIC SERVICE and NEW ENGLAND COALITION, INC., Petitioners, v. UNITED STATES OF AMERICA and NUCLEAR REGULATORY COMMISSION, Respondents, and ENTERGY NUCLEAR OPERATIONS, INC. and ENTERGY NUCLEAR VERM ONT YANKEE, LLC, Intervenor-Respondents

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On Petition for Review of a Decision of the United States Nuclear Regulatory Commission

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FINAL BRIEF OF INTERVENORS ENTERGY NUCLEAR OPERATIONS, INC. AND ENTERGY NUCLEAR VERMONT YANKEE, LLC

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Elise N. Zoli, Esq.

Kevin P. Martin, Esq.

Goodwin Procter LLP 53 State Street Boston, MA 02109-2802

(617) 570-1000 David R. Lewis, Esq. Pillsbury Winthrop Shaw Pittman LLP 2300 N Street Washington, DC 20037 (202) 663-8474

Counsel for Intervenors March 19, 2012 USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 1 of 103 ii CERTIFICATE AS TO PARTIES, RULINGS, AND RELATED CASES Counsel for Intervenors certifies the following: Parties and Amici: All parties, intervenors, and amici appearing in this Court are listed in the Brief for the Respondents.

Rulings Under Review: The relevant ruling for review in this Court is the NRC's March 10, 2011 Memorandum and Order terminating the license renewal proceeding for the Vermont Yankee Nuclear Power Station. Entergy Nuclear Vermont Yankee, LLC , CLI-11-02, 73 N.R.C. __, slip op. (Mar. 10, 2011) [RA897]. Related Cases: There are no related cases within the meaning of D.C. Cir. Rule 28(a)(1)(C).

USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 2 of 103 iii CORPORATE DISCLOSURE STATEMENT Entergy Nuclear Vermont Yankee, LLC, is a Delaware limited liability company formed to hold the assets of the Vermont Yankee Nuclear Power Station and engaged principally in the business of se lling its electric energy at wholesale in the United States. Entergy Nuclear Vermont Yankee, LL C, is a direct, wholly-owned subsidiary of Entergy Nuclear Vermont Investment Company, LLC, and an indirect, wholly-owned subsidiary of En tergy Nuclear Holding Company #3, LLC; Entergy Nuclear Holding Company; and En tergy Corporation. No other publicly held company has 10 percent or more equity interest in Entergy Nuclear Vermont Yankee, LLC.

Entergy Nuclear Operations, Inc. is a Delaware corporation engaged principally in the business of opera ting nuclear power f acilities owned by its affiliates in the northeastern United States.

Entergy Nuclear Operations, Inc. is a direct, wholly-owned subsidiary of Entergy Nuclear Holding Company #2 and an indirect wholly owned subsidiary of Enter gy Corporation. No other publicly held company has 10 percent or more equity in terest in Entergy Nuclear Operations, Inc. USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 3 of 103 iv TABLE OF CONTENTS CERTIFICATE AS TO PARTIES, RULINGS, AND RELATED CASES ............ ii CORPORATE DISCLOSU RE STATEMENT ....................................................... iii TABLE OF CONTENTS ......................................................................................... iv TABLE OF AUTHORITIES ..................................................................................... v GLOSSARY ............................................................................................................ xii COUNTER-STATEMENT REGA RDING JURISDICTION ................................... 1 STATEMENT OF THE ISSU ES............................................................................... 6 STATUTES & REGULATIONS .............................................................................. 6 STATEMENT OF FACTS ........................................................................................ 6

SUMMARY

OF AR GUMENT ............................................................................... 12 ARGUMENT ........................................................................................................... 14 I. Standard of Review ........................................................................................ 14 II. Petitioners Did Not Exhaust Their Administrative Remedies....................... 14 III. Petitioners' Substantive Arguments are Meritless because Entergy Possessed a Valid, Unexpired WQC When it Applied for a Renewal License. ............ 20 A. The Existing WQC Supports the License Renewal Application ............. 21 B. NRC Was Not Required to Indicate Affirmatively Its Reliance on the WQC Identified by Entergy and Already in NRC's Files ........................ 29 C. The Desirability of Further Explanation Is At Most Harmless Error....... 32 CONCLUSION ........................................................................................................ 34 ADDENDUM USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 4 of 103 v TABLE OF AUTHORITIES Cases Page 21st Century Telesis Joint Venture v. FCC, 318 F.3d. 192 (D.C. Cir. 2003) .......... 17 American Rivers v. FERC , 129 F.3d 99 (2d Cir. 1997) ..................................... 26-27 Bethesda Chevy Chase Broadc asters, Inc. v. FCC ,

385 F.2d 967 (D.C. Cir. 1967) ................................................................................... 2 Bowman Transp., Inc. v. Ark ansas-Best Freight Sys., Inc.,

419 U.S. 281 (1974) ................................................................................................. 30 Carolina Envtl. Study Grp. v. AEC , 510 F.2d 796 (D.C. Cir. 1975) ......................... 3 Citizens for Fair Util. Regulation v. NRC , 898 F.2d 51 (5th Cir. 1990) ............... 2-3 Citizens for Safe Power, Inc. v. NRC , 524 F.2d 1291 (D.C. Cir. 1975) .................... 3 City of Benton v. NRC , 136 F.3d 824 (D.C. Cir. 1998) ............................................. 3 City of Tacoma v. FERC , 460 F.3d 53 (D.C. Cir. 2006) ................................... 29-30 Cohen v. United States , 650 F.3d 717 (D.C. Cir. 2011) .......................................... 14 County of Rockland v. FAA, 335 Fed. Appx. 52 (D.C. Cir. 2009) .......................... 34 Authorities upon which Intervenors chiefly rely are marked with an asterisk.

USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 5 of 103 vi *Entergy Nuclear Vermont Yankee, LLC

(Vermont Yankee Nuclear Power Station), LB P-06-20,

64 N.R.C. 131 (2006) ....................................................................................... 8-9, 15

Entergy Nuclear Vermont Yankee, LLC

(Vermont Yankee Nuclear Power Station), LB P-08-25,

68 N.R.C. 763 (2008) ......................................................................................... 11, 16

Entergy Nuclear Vermont Yankee, LLC

(Vermont Yankee Nuclear Power Station), LB P-10-19,

72 N.R.C. __, slip op. (Oct. 28, 2010) ....................................................................... 5 Entergy Nuclear Vermont Yankee, LLC

(Vermont Yankee Nuclear Power Station), CL I-11-02,

73 N.R.C. __, slip op. (Mar. 10, 2011) ........................................................ 1, 3, 5, 11 Envirocare of Utah, Inc. v. NRC , 194 F.3d. 72 (D.C. Cir. 1999) .............................. 3 Envtl. Law & Policy Ctr. v. NRC, 470 F.3d 676 (7th Cir. 2006) ............................... 2 Escondido Mut. Water Co. v. La Jolla Band of Mission Indians ,

466 U.S. 765 (1984) ................................................................................................. 21 Honeywell, Int'l, Inc. v. EPA , 372 F.3d 441 (D.C. Cir. 2004)................................. 31 *Honicker v. NRC, 590 F.2d 1207 (D.C. Cir. 1978) ................................................. 1 In re Entergy Nuclear/Vermont Yankee Thermal Discharge

Permit Amendment , No. 89-4-06 Vtec, slip op. (Vt. Envtl. Ct. Jan. 9, 2007) ......... 33 In re Entergy Nuclear Vermont Yankee Discharge Permit 3-1199 ,

189 Vt. 140, 989 A.2d 563 (2009) ........................................................................... 32 USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 6 of 103 vii Keating v. FERC , 927 F.2d 616 (D.C. Cir. 1991) .............................................

22, 30 *Massachusetts v. NRC , 924 F.2d 311 (D.C. Cir. 1991) ....................................... 2, 5 Nat'l Whistleblower Ctr. v. NRC , 208 F.3d 256 (D.C. Cir. 2000) ...................... 3, 34 NARUC v. FCC , 746 F.2d 1492 (D.C. Cir. 1984) ............................................. 31-32 NetworkIP, LLC v. FCC , 548 F.3d 116 (D.C. Cir. 2008) ........................................ 18

Nevada v. DOE , 457 F.3d 78 (D.C. Cir. 2006) ................................................ 33-34 N.J. Envtl. Fed'n v. NRC , 645 F.3d 220 (3d Cir. 2011) ............................................ 2 North Carolina v. FERC , 112 F.3d 1175 (D.C. Cir. 1997) ..................................... 18 Nw. Ind. Tel. Co. v. FCC , 872 F.2d 465 (D.C. Cir. 1989) ....................................... 17 NRDC v. NRC , 666 F.2d 595 (D.C. Cir. 1981) .......................................................... 1 Power Co. of Am., L.P. v. FERC , 245 F.3d 839 (D.C. Cir. 2001) ........................... 18 Private Fuel Storage, L.L.C. (Independent Spent Fuel Storage Installation),

CLI-00-24, 52 N.R.C.

351 (200 0)............................................................................ 16 Private Fuel Storage, L.L.C. (Independent Spent Fuel Storage Installation),

CLI-05-22, 62 N.R.C.

542 (200 5)............................................................................ 20 Public Citizen, Inc. v. FAA , 988 F.2d 186 (D.C. Cir. 1993) .............................. 30-31 San Luis Obispo Mothers for Peace v. NRC , 449 F.3d 1016 (9th Cir. 2006) ........... 2 USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 7 of 103 viii San Luis Obispo Mothers for Peace v. NRC , 635 F.3d 1109 (9th Cir. 2011) ........... 2 Save Our Heritage, Inc. v. FAA, 269 F.3d 49 (1st Cir. 2001) ................................. 33 Sierra Club v. NRC , 862 F.2d 222 (9th Cir. 1988) ................................................ 3, 5 Southern Pac. Transp. Co. v. ICC , 69 F.3d 583 (D.C. Cir. 1995) ..................... 30-31 UCS v. NRC , 735 F.2d 1437 (D.C. Cir. 1984) ......................................................... 20 Village of Bensenville v. FAA , 457 F.3d 52 (D.C. Cir. 2006).................................. 31 *Woodford v. Ngo , 548 U.S. 81 (2006) ............................................................. 14-15 Federal Statutes and Regulations Atomic Energy Act of 1954 , 42 U.S.C. § 2011 et seq. ..........................................

1,19 *Water Quality Improvement Act of 1970 ,

Pub. L. No.91-224, § 21(b), 84 Stat. 91, 108-109 (1970), reprinted in 1970 U.S.C.C.A.N.

97 . ...................................................................................................... 7 Federal Water Pollution Control Act Amendments of 1972 ,

Pub. L. No.92-500, § 401(a), 86 Stat. 816, 877-80 (1972) ....................................... 7

5 U.S.C. § 706 ...................................................................................... 14, 30-31, 33

28 U.S.C. § 2344 .............................................................................................. 1-2, 4 28 U.S.C. § 2347(a) ................................................................................................... 4 33 U.S.C. § 1251 note ................................................................................................ 7 USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 8 of 103 ix 33 U.S.C. § 1311 ...................................................................................................... 28

33 U.S.C. § 1341(a)(1) .................................................... 6-13, 16, 18 , 19-23, 26-31

33 U.S.C. § 1341(a)(3) ......................................................................... 21-22, 24-28

33 U.S.C. § 1342 .................................................................................................... 28 42 U.S.C. § 2239(a) ................................................................................................. 15 10 C.F.R. § 2.309 ........................................................................................... 8, 11, 15 10 C.F.R. § 2.332(d) .................................................................................................. 5 10 C.F.R. § 2.336 ..................................................................................................... 28 10 C.F.R. § 2.340(a) ................................................................................................... 5 10 C.F.R. § 2.341(b) .......................................................................................... 11, 16 10 C.F.R. § 2.1212 ................................................................................................... 11 10 C.F.R. Part 2, App. B, § II .................................................................................... 5 10 C.F.R. § 51.71(c) ................................................................................................. 10 10 C.F.R. § 54.17(e) ................................................................................................. 30 40 C.F.R. §§ 122 - 136 ............................................................................................. 28 40 C.F.R. §§ 400 - 501 ............................................................................................. 28 USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 9 of 103 x State Statutes and Regulations 10 V.S.A. § 1263(c) ................................................................................................. 32 Vt. Water Pollution Control Permit Regulations § 13.11 ........................................ 27 Other Authorities 56 Fed. Reg. 29,403 (June 27, 1991) ......................................................................... 3 71 Fed. Reg. 6,102 (Feb. 6, 2006) ............................................................................. 7 71 Fed. Reg. 15,220 (Mar. 27, 2006) ......................................................................... 8 71 Fed. Reg. 20,733 (Apr. 21, 2006) ......................................................................... 8 71 Fed. Reg. 76,706 (Dec. 21, 2006) ....................................................................... 10 *115 Cong. Rec. H9,264 (daily ed. Apr. 16, 1969) ........................................... 25-26 *H.R. Rep. No.91-127 (1969), reprinted in 1970 U.S.C.C.A.N. 2691 .................. 24

Conf. Rep. No.91-940 (1970), reprinted in 1970 U.S.C.C.A.N. 2712 ........... 23, 25

NUREG-1437, Generic Environmental Impact Stat ement for License Renewal of Nuclear Plants (1996) ............................................................................................. 31 D.C. Cir. Rule 28(a)(1)(C) ....................................................................................... ii D.C. Cir. Rule 28(d)(2) ........................................................................................ 6, 20 USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 10 of 103 xi Black's Law Dictionary (9th ed. 2009) ................................................................... 18 USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 11 of 103 xii GLOSSARY Abbreviation Term AEC Atomic Energy Commission ASLB Atomic Safety and Licensing Board CWA Clean Water Act DPS Vermont Department of Public Service EIS Environmental Impact Statement NEC New England Coalition NEPA National Environmental Policy Act NPDES National Pollutant Discharge Elimination System NRC Nuclear Regulatory Commission VANR Vermont Agency of Natural Resources WQC Water Quality Certification USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 12 of 103 COUNTER-STATEMENT REGARDING JURISDICTION The NRC had jurisdiction over this matter pursuant to the broad grant of authority contained in the Atomic Energy Act of 1954, 42 U.S.C. §§ 2011 et seq.

The Court of Appeals, however, does not have jurisdiction over this matter.

Under the Hobbs Act, any pa rty aggrieved by an agency's final order may, within sixty days of the order, petition for revi ew of the order in the geographically appropriate court of appeal

s. 28 U.S.C. § 2344. "The 60 day period for seeking judicial review . . . is jurisdictional in na ture, and may not be en larged or altered by the courts."

NRDC v. NRC, 666 F.2d 595, 602 (D.C. Cir. 1981) (footnote omitted).

In this case, the NRC issued a Memorandum and Order, CLI-11-02, on March 10, 2011, which constituted its fina l order because it resolved all challenges brought by DPS and NEC and terminated the proceeding. Entergy Nuclear Vermont Yankee, LLC , CLI-11-02, 73 N.R.C. __, slip op.

at 18 (Mar. 10, 2011) ("CLI-11-02") [RA897]. DPS and NEC pe titioned for judicial review on May 20, 2011, seventy days after NRC filed its final order. Their petitions are, therefore, untimely and must be dismissed for lack of jurisdiction. Final orders are those that impose an obligation, deny a right, or fix some legal relationship.

Honicker v. NRC , 590 F.2d 1207, 1209 (D.C. Cir. 1978) (per curiam). Generally . . . an NRC order is final if it disposes of all issues as to all parties in the licensing proceeding, that is, if it consummates the USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 13 of 103 2 agency's decisionmaking process and results in granting, denying, suspending, revoking, or amending a license.

Massachusetts v. NRC , 924 F.2d 311, 322 (D.C. Cir. 1991). A final order is not necessarily the last order in a proceeding.

See Bethesda Chevy Chase Broadcasters, Inc. v. FCC , 385 F.2d 967, 968 (D.C. Cir. 1967).

When the NRC's final adjudicatory decision results in the issues raised by a party being fully and finally adjudicated, such that that party has no further role to play in the administrative proceedings, the order is reviewable under the Hobbs Act even if the license has not yet issued.

See, e.g., Envtl. Law & Policy Ctr. v. NRC , 470 F.3d 676, 681 (7th Cir. 2006) (holding that an NRC decision resolving the

petitioner's contentions in a licensing pro ceeding constituted a final order, even though the license had not yet issued, because that order "determined the [party's] rights, and legal consequences flowed from that determination.").

See also N.J. Envtl. Fed'n v. NRC , 645 F.3d 220, 227-28, 237 (3d Cir. 2011) (reviewing Commission's "Final Decision" affirming Licensing Board Initial Decision and denying intervenor's motion to reopen and petition for review).

1 This Court, for 1 See also San Luis Obispo Mothers for Peace v. NRC , 635 F.3d 1109, 1120-21 (9th Cir. 2011) (following Commission's final adjudicatory decision, reviewing

orders denying a "closed hearing" on sensitive information and rejecting certain contentions); San Luis Obispo Mothers for Peace v. NRC , 449 F.3d 1016, 1024 (9th Cir. 2006) (Commission decision de nying petition for revi ew of Licensing Board decisions was final order revi ewable by the court under 28 U.S.C. § 2344); Citizens for Fair Util. Regulation v. NRC , 898 F.2d 51, 56 (5th Cir. 1990) (reviewing Commission order denying la te-filed intervention in licensing USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 14 of 103 3 example, has taken immediat e review of NRC orders denying a party leave to intervene in licensing proceedings.

See Nat'l Whistleblower Ctr. v. NRC , 208 F.3d 256, 258, 261 (D.C. Cir. 2000) (reviewing Commission decision affirming Licensing Board decision denying intervention);

Envirocare of Utah, Inc. v. NRC , 194 F.3d 72, 74 (D.C. Cir. 1999) (reviewi ng NRC final order denying request to intervene in licensing proceedings). Here, CLI-11-02 was the final NRC Order that disposed of all issues that DPS and NEC had put in controversy. It ended DPS' a nd NEC's participation as parties and terminated the adjudicatory pr oceeding. This Court's decision in City of Benton v. NRC , 136 F.3d 824 (D.C. Cir. 1998), does not compel any different result. While that decision states it is th e order granting or denying the license that is ordinarily the final order (id. at 825), the case involved a request for review of an interlocutory NRC Staff determination that neither resolved all issues nor authorized license issuance. Moreover, the decision did not involve a proceeding in which a hearing had been held and a final adjudicatory decision rendered. proceeding); Sierra Club v. NRC , 862 F.2d 222, 225 (9th Cir. 1988) (decision of Appeal Board affirming Licensing Board decision was final reviewable order);

Carolina Envtl. Study Grp. v. AEC, 510 F.2d 796, 798 (D.C. Cir. 1975) (decision of Atomic Safety and Licensing A ppeal Board was the final order);

Citizens for Safe Power, Inc. v. NRC, 524 F.2d 1291, 1293 n.1 (D.C. Cir. 1975) (reviewing final decision and order of Atomic Safe ty and Licensing Appeal Board). It should be noted that the NRC's Atomic Safety and Licensing Appeal Board presided over administrative appeals in NRC adjudicatory proceedings until 1991, when the Board was abolished.

See 56 Fed. Reg. 29,403 (June 27, 1991).

USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 15 of 103 4 Treating the final adjudicatory decision resolving the disputes that a party has raised in a hearing as the relevant "final order" under the Hobbs Act aligns judicial review of agency action with the requirement found elsewhere in the Hobbs Act limiting the right to petition for review to a "party aggrieved." 28 U.S.C. § 2344. Further, 28 U.S.C. § 2347(a) requires judicial review based on the record consisting of the pleadings, evid ence adduced, and proceedings before the agency when the agency has held a hearing (as in this case). For these reasons, the relevant, reviewable final order should be the agency's adjudicatory order finally resolving all issues raised by the petitioner. Construing "final order" as the fi nal adjudicatory decision resolving the disputes that a party raised in a hearing (as opposed to the subsequent administrative issuance of a license) is also appropriate as a matte r of policy. If the final adjudicatory decision were not cons idered the final order under 28 U.S.C. § 2344, then parties whose hearing requests are resolved (and, thus, whose participation has ended) early in a lic ensing proceeding would have to wait until license issuance to seek redress. Conversely, parties who unsuccessfully opposed licensing in an NRC hearing could delay s eeking judicial review until after license issuance - which can occur much later if a hearing request is resolved early in a proceeding - thus threatening to disrup t or delay the licensed activity. These USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 16 of 103 5 outcomes would be inconsistent with the judicial interest in ensuring prompt review. See Sierra Club , 862 F.2d at 225.

Moreover, in this case, CLI-11-02 not only terminated NEC's and DPS' participation and resolved all issues that they had placed in controversy, but also consummated the agency's decisionmaki ng process and resulted in NRC granting of the renewed license. See Massachusetts , 924 F.2d at 322. Under the NRC rules, the evidentiary hearing in a contes ted proceeding occurs after the NRC Staff has completed its final safe ty evaluation report and final environmental impact statement (i.e., after the NRC Staff has completed its review and formulated its findings).

See 10 C.F.R. § 2.332(d); 10 C.F.R. Part 2, App. B, § II. That procedure was followed below.

See Entergy Nuclear Vermont Yankee, LLC, LBP-10-19, 72 N.R.C. __, slip op. at 3 (Oct. 28, 2010) [RA853]. Thus, with the issuance of CLI-11-02, the Staff was aut horized to issue the renewed license.

See 10 C.F.R. § 2.340(a). Indeed, as the Commission publicly announced, that Order was "the final step in the NRC's detailed technical and legal process of examining whether it's appropriate to issue a renewed license." Press Release, NRC, No.11-041, NRC Will Renew Vermont Yankee's Op erating License for an Additional 20 Years (Mar. 10, 2010) [RA901-02].

USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 17 of 103 6 STATEMENT OF THE ISSUES In the event the Court determines it has jurisdiction over Petitioners' claims, the substantive issues pr esented are the following: 1. Whether the petitions must be dismissed because DPS and NEC failed to exhaust their administrative remedies. 2. Whether the petitions must be dismissed because NRC possessed a valid water quality certification ("WQC") a pplicable to Entergy's application for license renewal. 3. Whether the petitions must be dismissed because Petitioners have shown no harm from a ny alleged error. STATUTES & REGULATIONS Statutes and regulations referenced herein are attached in the addendum. STATEMENT OF FACTS Consistent with D.C. Cir. Rule 28(d)(2), Entergy will not repeat Respondents' Statement of Facts, but provi des the following elaboration. As Respondents correctly observe, Section 9.2.1 of Entergy's Environmental Report explicitly relied upon a WQC issued in 1970 in connection with Vermont Yankee's initial licensing to satisfy Entergy's oblig ations under Section 401 of the Clean Water Act, 33 U.S.C. § 1341, and also identified Vermont Yankee's current and effective NPDES permit as reflecting continuing complia nce with applicable CWA USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 18 of 103 7 standards. [RA45]. The 1970 WQC had been issued by Vermont while Vermont Yankee was still under construction and two years before the receipt of the facility's initial operating license.

2 Vermont Yankee forwar ded this WQC to AEC shortly after its issuance; 3 it remains in NRC's files to this day.

4 This WQC on its face contains no terms or conditions (e.g., expiration date) precluding its use in support of a license renewal.

After publishing notices of the ava ilability and acceptance of Entergy's application, 5 the NRC solicited comments on the scope of environmental review and on identification of "other environmen tal review and consultation requirements 2 Vermont Yankee's WQC was issued under Section 21(b) of the Federal Water Pollution Control Act, as added by the Water Quality Improvement Act of 1970, P.L.91-224. In the Federal Water Po llution Control Act Am endments of 1972, P.L.92-500, Congress adopted Section 21(b) as Section 401(a) with only minor changes. Congress simultaneously adopted a "savings" provision at Section 4(b) of P.L.92-500 with respect to previ ous Section 21(b) certifications. The "savings" provision provides, in relevant part, that: all . . . certifications . . . duly issued . . . pursuant to the Federal Water Pollution Control Act as in effect immediat ely prior to the date of enactment of this Act, and pertaining to any . . .

requirements, . . . unde r the Federal Water Pollution Control Act as in effect immediat ely prior to the date of enactment of this Act, shall continue in full force and effect after the date of enactment of this Act until modified or rescinded in accordance with the Federal Water Pollution Control Act as amended by this Act.

See 33 U.S.C. § 1251 note. Vermont has never taken any action to modify or rescind Vermont Yankee's WQC.

3 Letter from J. Ritsher to AEC (Nov. 13, 1970) [DRA1-2].

4 The WQC is publicly available from NRC's public document room under Accession No. 027369.

5 See 71 Fed. Reg. 6,102 (Feb. 6, 2006); 71 Fed. Reg. 15,220 (Mar. 27, 2006).

USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 19 of 103 8 related to the proposed action." 71 Fed.

Reg. 20,733, 20,734 (Apr. 21, 2006). The Vermont state water quality certification authority (the Vermont Agency of Natural Resources ("VANR")) responded to this reque st in language reflective of Section 401, informing the NRC that "[t]he requirements of the Clean Water Act and the NPDES permit will provide assurance that the impacts of the permitted intake structures and discharges meet the app licable federal and state requirements."

6 Subsequently, the NRC met and consulted with VANR on at least two occasions.

7 Neither VANR nor any other agency or member of the public took issue with Entergy's reliance on the 1970 WQC and NPDES permit, or stated that a new WQC was necessary during this consultation process.

8 Further, the NRC provided an opportunity for hearing.

See 71 Fed. Reg. at 15,220. Although both the hearing notice (id. at 15,221) and NRC's rules (10 C.F.R. § 2.309(a), (f)(1), (f)(2)) required any hearing request to set forth the specific contentions to be litigated, D PS' and NEC's hearing requests did not include any contentions challenging - or even mentioning - the discussion of 401 6 Memorandum from VANR to NRC, Sc oping Comments for Vt. Yankee Nuclear Power Station License Renewal (June 23, 2006) at 1 [RA61].

7 See NRC Summary of Envtl. Site Audit Rel ated to the Review of the License Renewal Application for Vt. Yankee Nu clear Power Station (July 11, 2006)

[RA116-18].

See also Email from R. Emch (NRC Environmental Project Manager) to C. Gjessing (Aug. 7, 2006) [RA198-99].

8 Environmental Impact Scoping Proce ss: Summary Report (Oct. 2006) [RA353-428]. USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 20 of 103 9 certification in Entergy's Environmental Report. See Entergy Nuclear Vermont Yankee, LLC , LBP-06-20, 64 N.R.C. 131, 162-19 9 (2006) ("LBP-06-20") [RA317-37] (identifying DPS' and NEC's contentions).

9 NEC's proposed Contention 1 challenged, under the National Environmental Policy Act ("NEPA"), whether Entergy's Environmental Report sufficiently assessed the impacts of thermal discharges into the Connecticut River. LBP-06-20, 64 N.R.C. at 175 [RA324]. As Respondents co rrectly state, the Board struck as improper NEC's subsequent attempt "t o introduce an entirely new argument regarding the alleged need fo r a section 401 certification . . . in a reply" concerning Contention 1 (id. at 182 [RA328]). NEC thereafter moved to amend Contention 1 to add, as an additional basis supposedly supporting the original contention, an allegation that Entergy's Environmental Report made no me ntion of any effort to obtain a WQC.

10 Entergy responded that this allegation was untimely and irrelevant to the contention, but also pointed out that certification was addressed in Section 9.2.1 of the Environmental Report, which NEC had not challenged.

11 In its reply, NEC made no attempt to challenge the sufficiency of the WQC referenced in 9 DPS also moved to adopt NEC's orig inal contentions, which the ASLB later granted "to the extent that the . . . NEC contentions have been admitted." LBP-06-20, 64 N.R.C. at 208 [RA342].

10 NEC's Late Contention or, Alternatively, Request for Leave to Amend or File a New Contention (Aug. 7, 2006) at 5 [RA210]. DPS has ac knowledged that it made no attempt to adopt the proposed amended contention. Pet. Brief at 6 n.5.

11 Entergy's Answer to NEC's Late Contention (Aug. 17, 2006) at 17 [RA251].

USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 21 of 103 10 the Environmental Report.

12 The ASLB denied NEC's motion to amend, reasoning that the need for a WQC was irrelevant to NEC's contention that Entergy had failed to assess thermal impacts. Unpublished Memorandum & Order (Oct. 30, 2006) at 7-8 [RA435-36]. In December 2006, the NRC issued its draft EIS and made it available for comment.

See 71 Fed. Reg. 76,706 (Dec. 21, 2006). Pursuant to 10 C.F.R. § 51.71(c), which requires a draft EIS to "list all Federal permits, licenses, approvals, and other entitlements which must be obtained in implementing the proposed action and will describe the status of compliance with those requirements,"

Appendix E of the draft EIS identified the permits, consultations and approvals required for license renewal.

[RA472-74]. Appendix E did not identify a need for a new Section 401 certification. Th e NRC provided a 75-da y period for written comments and also scheduled two public meetings at which comments could be provided. 71 Fed. Reg. at 76,707. In addition, the NRC forwarded a copy of the draft EIS to both the DPS and VANR.

13 Neither these Vermont agencies nor NEC 12 New England Coalition Inc.'s (NEC) Re ply to Entergy and NRC Staff Answers to NEC's Late Contention, or Alternativel y, Request for Leave to Amend or File a New Contention (Aug. 28, 2006) at 5-6 [RA281-82].

13 See Letter from R. Franovich to U.S. EPA, Noti ce of Availability of the Draft Plant-Specific Supplement 30 to the Generic Environmental Impact Statement

for License Renewal of Nuclear Plants (GEIS) Regarding Vermont Yankee Nuclear Power Station (Dec. 13, 2006) [RA440-48].

USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 22 of 103 11 provided comments asserting a need for a new Section 401 certification.

14 Further, although the NRC rules provide an opportunity for parties to submit additional contentions based on information in a draft or final EIS (10 C.F.

R. § 2.309(f)(2)), neither DPS nor NEC exercised this right.

Following an evidentiary hearing on the admitted contentions (i.e., contentions unrelated to 401 certification), the ASLB issued a Partial Initial Decision resolving all but one of those contentions. Entergy Nuclear Vermont Yankee, LLC , LBP-08-25, 68 N.R.C. 763 (2008) [RA769-850-] ("LBP-08-25").

This Partial Initial Decision provided: With the exception of [the contention left open unrelated to water quality] and the opportunity to seek re consideration of facts officially and judicially noticed, this Partial Initial Decision shall constitute the final decision of the Commission forty (40) days after the date of its issuance, unless, within fifteen (15) days of its service, a petition for review is filed in accordance w ith 10 C.F.R. §§ 2.1212 and 2.341(b).

Filing a petition for review [with the Commission] is mandatory for a party to exhaust its administrative remedies before seeking judicial review. 10 C.F.R. § 2.341(b)(1).

Id. at 897 [RA843-44]. While the NRC rules allow parties to seek review of any prejudicial procedural error by the ASLB (10 C.F.R. § 2.341(b)(1), (b)(4)), neither NEC nor DPS attempted to appeal the AS LB rulings that had rejected NEC's earlier efforts to raise a 401 certification i ssue. Even after the Commission issued CLI-11-02 resolving the final issues and terminating the proceeding, and publicly 14 Appendix A to the final EIS summarizes comments received during the environmental review. [RA486-765].

USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 23 of 103 12 announced that the renewed license woul d be issued soon (NRC Press Release No.11-041, supra [RA901-02]), neither DPS nor NEC made any attempt to alert the Commission to any impediment.

SUMMARY

OF ARGUMENT The petitions must be dismissed beca use NEC and DPS failed to exhaust their available and - under NRC regulations - mandatory administrative remedies before filing their petitions for judici al review. Entergy stated in the Environmental Report accompanying its license renewal application that it was relying on the 1970 WQC and NPDES permit, and the NRC indicated in its draft and final EIS that a new 401 certifica tion was not require

d. DPS passed on numerous opportunities before the NRC to assert that Entergy's license renewal application required a new WQC. NEC pr otested that Entergy had not obtained a WQC, but only in an untimely and procedurally improper manner that never challenged the validity or sufficiency of Vermont Yankee's existing WQC.

Neither Petitioner filed an administrative a ppeal of the ASLB's decisions that 401 certification had not been properly rais ed. Neither Petitioner availed itself of subsequent opportunities to raise the i ssue of 401 certification through comments on or new contentions challenging the draft or final EIS. Having failed to present their argument regarding a new WQC to NRC in accordance with NRC rules, Petitioners cannot do so now. Indeed, Petitioners make no attempt to argue before USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 24 of 103 13 this Court that the ASLB's relevant pr ocedural decisions were arbitrary and capricious. Having failed to challenge thos e procedural decisions in their petitions or opening brief, Petitioners cannot now do so in their reply.

Even if Petitioners' failure to exhaust were excusable, their petitions fail on the merits because Entergy identified a valid WQC satisfying Section 401 when it submitted its license renewal application.

Entergy documented its reliance on the earlier WQC in its Environmental Report, and the NRC had a copy of the WQC in its files. Nothing in the CWA precludes the use of a WQC issued in connection with initial licensing from being used to support subsequent applications for license renewal. Regardless of how the 1970 WQC (issued to Vermont Yankee while the facility was under construction) is classified, it is sufficient to support Entergy's license rene wal application.

Petitioners suggest that state water quality standards will be evaded if a new WQC is not required. This argument ignor es the fact that, as VANR itself reported to the NRC, the requirement that Verm ont Yankee hold and pe riodically renew its NPDES permit under Section 402 of the CWA assures continued compliance with state water quality standards. For this same reason, any claimed inadequacy in the NRC's explanation of its decision is (apart from being largely of Petitioners' own making) at most harmless error.

USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 25 of 103 14 ARGUMENT I. Standard of Review This Court examines de novo whether it has jurisdiction over this appeal.

See Cohen v. United States , 650 F.3d 717, 722 (D.C. Cir. 2011). The Court may only set aside an NRC grant of a renewal license if it was "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law." 5 U.S.C. § 706(2)(A).

II. Petitioners Did Not Exhaust Th eir Administrative Remedies Neither DPS nor NEC exhausted their NRC-mandated administrative remedies by challenging Entergy's reliance on the 1970 WQC and NPDES permit in accordance with NRC's procedural rules. "[A]s a general rule . . . courts should not topple over administrative decisions unless the administrative body not only has erred, but has erred against objection made at the time appropriate under its practice." Woodford v. Ngo, 548 U.S. 81, 90 (2006) (emphasis in original) (citation omitted). The administrative exhaustion requirement gives agencies "a fair and full opportunity" to adjudicate claims presented to them by requiring that litigants use "all steps that the agency holds out, and d[o] so properly (so that the agency addresses the i ssues on the merits)."

Id. (emphasis in original) (citation omitted). "Proper exhaustion demands compliance with an agency's deadlines and other critical procedural rules because no adjudicative system can function USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 26 of 103 15 effectively without imposing some orderly structure on the course of its proceedings."

Id. at 90-91 (footnote omitted). The NRC provides administ rative hearings, typically before an ASLB, to address disputes by any person regarding an application.

See 42 U.S.C. § 2239(a)(1)(a). To obtain such a hearing and party status, a person must file a petition specifying admissible contentions to be litigated.

See 10 C.F.R. § 2.309(a). NRC rules require contentions to address documents available when the petition is filed (e.g., an applicant's Environmental Report), but also allow a petitioner to file additional or amended contentions based upon new developments in the proceeding (e.g., the issuance of a draft or final EIS).

See 10 C.F.R. § 2.309(f)(1), (f)(2).

Petitioners persistently failed to comply with these clear procedural requirements. Petitioners' claim that DPS and NEC "diligently and directly asserted" the WQC issue (see Pet. Brief at 6) is belied by the fact that the ASLB informed Petitioners in two separa te rulings that a WQC issue had not been properly raised. See LBP-06-20, 64 N.R.C. 162, 182

[RA328] (rejecting NEC's attempt to introduce new allegations in a reply); Unpublished Memorandum and Order (Oct. 30, 2006) at 7-8 [RA435-36] (re jecting as procedurally inappropriate an attempt to interject irrelevant material into an existing contention). Petitioners ignore this part of the record.

USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 27 of 103 16 For its part, DPS failed to raise the WQC issue before the ASLB or NRC at all. Throughout the NRC proceedings, D PS never once suggested the need for a new WQC or questioned the sufficiency of Vermont Yankee's existing WQC. Further, neither NEC nor DPS made any attempt to appeal the ASLB rulings rejecting as procedurally improper NEC's attempt to inject a 401 certification issue into the proceeding. Under NRC rules, after an ASLB issues an initial decision a party may seek Commission review of any "prejudicial procedural error."

See 10 C.F.R. § 2.341(b)(1), (b)(4)(iv). Thus, prior rulings denying admission of contentions are appealable afte r a Partial Initial Decision.

See Private Fuel Storage, L.L.C., CLI-00-24, 52 N.R.C. 351, 353 (2000). Petitioners simply failed to take advantage of this opportunity, despite having been informed that "[f]iling of a petition for review [with the Commission] is mandatory for a party to exhaust its administrative remedies before seeking judi cial review. 10 C.F.

R. § 2.341(b)(1)." LPB-08-25, 68 N.R.C. at 897 [RA844]. Petitioners compounded these failures by not availing themselves of additional opportunities to challenge En tergy's reliance on the existing WQC.

Neither the NRC's draft nor final EIS identified a need for a new WQC in its listing of permits, consultations , and approvals required fo r license renewal. While both Petitioners could have submitted comments or f iled new and/or amended contentions challenging these documents for not identifying a need for a new USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 28 of 103 17 certification, neither did so. Petitioners ma ke no effort to explain in their brief why, despite having filed comments with NRC on the draft EIS with respect to other subjects, they never once me ntioned any need for a new WQC.

Petitioners gloss over the failure to exhaust their administrative remedies by arguing that they raised the WQC issue before the ASLB, and therefore provided NRC an opportunity "to respond to the merits of these arguments." Pet. Brief at 27. Petitioners thus imply that NRC's l ack of response to the WQC issue was arbitrary and capricious, regardless of how the issue was raised. NRC, however, did respond; the ASLB found that the issue had not been raised in accordance with NRC procedural rules because it was raised for the first time in a reply brief and subsequently in a motion to amend an unrelated contention. An agency is not required to address the merits of an argument raised in contravention of its procedural rules. 21st Century Telesis Joint Venture v. FCC , 318 F.3d 192, 200 (D.C. Cir. 2003). "The efficiency a nd fairness values served by exhaustion principles would be seriously compromised if agencies were obliged to furnish such second bites at the apple."

Nw. Ind. Tel. Co. v. FCC , 872 F.2d 465, 471 (D.C. Cir. 1989) (footnote omitted). Importantly, Petitioners do not allege any error in ASLB's relevant procedural decisions. Having failed to ch allenge those procedural decisions in their petitions or opening brief, Petitione rs have waived any such claim.

USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 29 of 103 18 NetworkIP, LLC v. FCC, 548 F.3d 116, 128 n.10 (D.C. Cir. 2008) ("[A]rguments not raised in opening brief are waived"); Power Co. of Am. v. FERC , 245 F.3d 839, 845 (D.C. Cir. 2001) (refusing to address arguments first raised in a reply brief).

Nor is there any validity to Petitioners' argument previously advanced on motion before this Court that the statutory procedure in Section 401 "pre-empts this Court's application of judicially created principles of exhaustion."

15 Petitioners relied on North Carolina v. FERC , 112 F.3d 1175 (D.C. Cir. 1997), for the proposition that Section 401 leaves no room for "issue preclusion"; however, that case does not address exhaustion.

16 In North Carolina , the Court held that a State was not precluded from raising the n eed for an additional 401 certification in a FERC licensing proceeding by virtue of not having raised this claim in a previous construction-related proceed ing before a different agency involving the "same issues, parties, and disc harge." 112 F.3d at 1185.

North Carolina did not involve a case where, as here, the State failed to raise the need for a new 401 certification before the agency whose action was being challenged. Moreover, Petitioners never explain why NRC's statutory obligations under Section 401 are uniquely immune 15 Petitioners' Reply and Memorandum in Opposition to Respondent's Motion to Dismiss and Intervenor's Cross Motion for Summary Reversal (Aug. 26, 2011) at 21 ("Pet. Opp.").

16 The term "issue preclusion" means that when a particular issue has been litigated, further litigation of the same issue is barred.

Black's Law Dictionary 1425 (9th ed. 2009).

USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 30 of 103 19 from application of the exhaustion doctrine when NRC's other no-less important statutory obligations under the Atomic En ergy Act and NEPA are subject to the exhaustion doctrine.

Finally, Petitioners' suggestion that the issue of 401 certification was beyond the scope of the NRC hearing is inaccurate. Contrary to Pe titioners' claim (Pet.

Brief at 7 n.6), neither Entergy nor NRC ever asserted that 401 certification was beyond the scope of the hearing. Rather, Entergy merely argue d that NEC's late attempts to raise this issue (first in a re ply brief, and then by seeking to shoehorn it into an irrelevant contention) were procedurally improper.

17 Similarly, the ASLB's statement that 401 certification is independent of NEPA and the NRC's implementing rules (see Pet. Brief at 9) simply expl ained, in the course of denying NEC's motion to amend, why 401 certifica tion was not relevant to a contention raising a wholly different issue: Entergy's assessment of thermal impacts as part of the NEPA process.

18 The record nowhere contains statements by the NRC to 17 Entergy's Answer to NEC's Late Contention (Aug. 17, 2006) at 3, 7, 17 [RA237, 241, 251]; Entergy's Motion to Strike Portions of New England Coalition's Reply (July 10, 2006) at 9-11 [RA105-07]; NRC Staff Answer Opposing NEC's Late Contention, or Alte rnatively, Request for Leave to Amend or File a New Contention (Aug. 17, 2006) at 11 n.9 [RA265].

18 Unpublished Memorandum and Order (Oct. 30, 2006) at 8 [RA436].

USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 31 of 103 20 the effect that the NRC would not have considered a contention relating to 401 certification had it been properly and timely filed.

19 Because Petitioners repeatedly failed to exhaust their available remedies before the NRC, their petitions must be denied.

III. Petitioners' Substantive Arguments are Meritless because Entergy Possessed a Valid, Unexpired WQC When it Applied for a Renewal License. Even if Petitioners had preserved their arguments by raising them properly before the ALSB and administratively a ppealing the ALSB's decisions to the Commission, their substantive arguments regarding NRC's compliance with Section 401 would be without merit. As Respondents explain (Resp. Br. at 34-37), an NPDES permit is equivalent to 401 certification. Consistent with D.C. Cir.

Rule 28(d)(2), Entergy will not repeat but fully agrees with Respondents' position.

19 Under the NRC rules, a contention in an NRC hearing may raise a genuine dispute with the applicant on any materi al issue of law or fact. 10 C.F.R. § 2.309(f)(1)(vi); see also UCS v. NRC , 735 F.2d 1437, 1443 (D.C. Cir. 1984) (hearing opportunity must extend to "all material factors bearing on the licensing decision. . . ."). The NR C cases that Petitioners disc uss to suggest otherwise (Pet. Brief at 9 n.8) indicate only that the NRC will not suspend a hearing while waiting for receipt of a 401 certification or permits from other agencies, and that an NRC hearing is not a proper forum to litigate whether ot her agencies should issue their permits. Nothing in these decisions would preclude an intervenor from challenging whether an applicant c ould rely on its existing WQC and/or NPDES permit to satisfy 401 certification re quirements. Further, all of the cited cases are licensing board decisions not considered binding precedent by the NRC. See, e.g., Private Fuel Storage, L.L.C., CLI-05-22, 62 N.R.C. 542, 544 (2005). USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 32 of 103 21 In addition, as discussed below, the existing, unexpired WQC was also sufficient to support license renewal.

A. The Existing WQC Supports the License Renewal Application Under its plain language, Section 401(a)(1) requires merely a certification that the discharge from operations will comply with applicable standards.

20 On its face, the existing WQC that NRC posse ssed and Entergy referenced in its application provided that certification. No thing in federal law (or Vermont's rules) restricts the length of time a WQC remains valid or prohibits a valid WQC issued in support of initial licensing from being used in support of license renewal. Thus, Petitioners miss the mark in claiming that "the record is devoid of any evidence that [Entergy] has ever requested a [WQC] . . . with regard to its proposed new operating license." Pet.

Brief at 22. Entergy had no need to seek a new WQC in connection to the license renewal beca use NRC already possessed a valid WQC certifying that Vermont Yankee's operati ons will not violate water quality standards. The permissibility of relying on prior certifications is not only inherent in Section 401(a)(1), but confirmed by Section 401(a)(3) which provides:

20 Absent a clearly expresse d legislative intention to the contrary, it is assumed "that Congress expresses its purposes through the ordinary meaning of the words it uses . . . ."

Escondido Mut. Water Co. v. La Jolla Band of Mission Indians , 466 U.S. 765, 772 (1984).

USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 33 of 103 22 The certification obtained pursuant to paragraph (1) of this subsection with respect to the construction of any facility shall fulfill the requirements of this subsection w ith respect to certification in connection with any other Federal license or permit required for the operation of such facility unless, afte r notice to the certifying State . . .

which shall be given by the Federal agency to whom application is made for such operating license or permit, the State . . . notifies such agency within sixty days after rece ipt of such notice that there is no longer reasonable assurance that there will be comp liance with the applicable provisions of sections [301, 302, 303, 306, 307] of this title. 33 U.S.C. § 1341(a)(3);

see also Keating v. FERC , 927 F.2d 616, 620 (D.C. Cir.

1991) (indicating that under S ection 401(a)(3) an agency is obligated to accept a valid WQC absent valid objections by the issuing state). If reliance on a prior construction-related certification is permissible, as Section 401(a)(3) indicates, then perforce so is reliance on a prior ope rations-related certification, since they both focus on the same operational impact s, as Congress recognized when these certification requirements were originally enacted.

21 Petitioners have never identified any reason why Congress would allow a constructio n-related WQC to support subsequent applications for renewed operating licenses but not permit an operations-related WQC to do so. The most logical reading of the CWA is that an operations-related WQC suffices for any subsequent operating license and, under Section 401(a)(3), a construction-relate d certificate under certain circumstances suffices as well.

21 See infra note 26. USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 34 of 103 23 This reading is supported by the legislative history, which shows that both the House and Senate intended to a llow Federal agencies to rely upon any prior certification. As reflected in the Conference Report on the Water Quality Improvement Act of 1970, which in Section 21(b) first established the water quality certification now found in Section 401, the House Bill before the Conference Committee provided: In any case where an activity requires two or more licenses or permits by a single Federal agency or mu ltiple Federal agencies and the applicant receives a certification under this section in connection with any one of those licenses or permits, then any Federal agency considering an application for a subsequent license or permit for that same activity, such Federal agency ma y accept the first certification as meeting the requirements of this section, if, after notice to the affected State or States or interstate agencies or to the Secretary as appropriate, no written objection is made to the granting of such license or permit without a subsequent certification.

Conf. Rep. No.91-940 at 52 (1970), reprinted in 1970 U.S.C.C.A.N. 2712, 2737. Similarly, the Senate amendment provided: A certification for Federal license or permit for a particular facility or activity shall satisfy the requireme nt of certification for any later Federal license or permit necessary fo r such facility of activity unless, after receiving notice of an applica tion for such later Federal license or permit, a State or the Secretary notifies such Federal licensing permitting agency that there has been a change in the nature of the activity, the design of the facility, the natural characteristics of the waters into which the discharge w ill be made, or in the water quality standards applicable to such waters , and there is not longer reasonable assurance of compliance with water quality standards. In such instances a second certification will be required.

USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 35 of 103 24 Id. at 53-54, reprinted in 1970 U.S.C.C.A.N. at 2739. To conclude that House and Senate conferees intended th e conference substitute ultim ately passed into law to be narrower than either of the two bills their respective chambers had passed earlier begs reason as it assumes that the House and Senate acceded to statutory language frustrating the legislative purpose clearly expressed in both antecedent bills. Amicus Riverkeeper mistakenly asserts that the House rejected the proposition that a certification obtained for a facility is valid for subsequent licenses. Riverkeeper's Brief at 18-20. Riverkeeper refers to an early bill reported out of the House Committee on Public Works requiring certification for both a construction permit and opera ting license. H.R. Rep. No.91-127 at 7-8 (1969), reprinted in 1970 U.S.C.C.A.N. 2691, 2698.22 However, during floor debate, the bill's sponsors chose to jettison the langua ge barring the use of an earlier state 22 The bill reported out of the Public Works Committee provided that "if the applicant receives a certification for one agency, it need not obtain a certification for another agency or for succeeding permits, or licenses unless the Secretary or the State, upon receipt of notice, objects, except that this provision does not apply to an application for an operating license or permit

." H.R. Rep. No.91-127 at 7, reprinted in 1970 U.S.C.C.A.N. at 2697 (emphasis added). Dismissing concerns expressed by the Chairman of the Joint Commission on Atomic Energy, the Public Works Committee initially conclude d: "the very different character of [construction permit and operating license] applications, the long period of time that lapses between their issuance, and the uncertainty as to the finality of plants at the construction license stage, all support the requirements for certification with respect to both applications" H.R. Rep. No.91-127 at 8, reprinted in 1970 U.S.C.C.A.N. at 2698. As discussed above , this view did not survive floor debates, as is reflected in Section 401(a)(3).

USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 36 of 103 25 certification for a subsequent operating li cense. 115 Cong. Rec. H9,264 (daily ed.

Apr. 16, 1969).

23 H.R. 4814 as passed by the Hous e and forwarded to the Senate omitted any prohibition of multi-use certifications.

24 Thus, rather than reflecting concern about using a certification over a long period of time, as Riverkeeper argues (see Riverkeeper's Brief at 20), the bills that were passed by each chamber specifically recognized and allowed such use.

For the same reasons, there is no valid ity to or rationale behind Petitioners' previously advanced argument that Sectio n 401(a)(3) specifies the only instance in which an applicant may rely on a prior certification (i.e. that only a construction-related certification and not an initial ope rations-related certification can support issuance of a renewed license).

25 To the contrary, the legislative history shows that Congress was trying to make it clear that construction-related certifications were like operational certifications and thus could also be relied upon in subsequent 23 Committee members here explained to th e entire House that the revised language eliminated "an undue and se vere burden" on nuclear power generation facilities while still permitting a process by which the st ates could protect their interest in waters within their boundaries.

See 115 Cong. Rec. at H9, 264-66 (statements of Reps. Edmonson and Holifield).

24 See Conf. Rep. No.91-940 at 52 reprinted in 1970 U.S.C.C.A.N at 2737. Riverkeeper's assertion that "the House ultimately passed the bill without relevant changes to this section" (Riverkeeper's Brief at 20) is inaccurate. As indicated by the Conference Committee Re port, the provision allowing reliance on prior certifications in the bill passed by the House omitted the restrictive language previously included in the bill th at had been reported out of the Public Works Committee.

See supra note 22. 25 Pet. Opp., supra note 15, at 6 & n.5.

USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 37 of 103 26 licensing.

26 Because construction and operation are different activities, a plain reading of Section 401(a)(1) (and former Section 21(b)(1)) might not have allowed a certification for "construction" to be used later as the certification for "operation," absent the clarifying language in Section 401(a)(3). Section 401(a)(3) (and former Section 21(b)(3)) remedied this by specifically permitting reliance on prior construction-related ce rtifications for subseque nt operating licenses - the scenario that had been of particular concern to the Joint Committee on Atomic Energy.27 Further, Section 401(a)(3) also provided specific protection to persons who had received a construction-stage certification by limiting a State's ability to revoke the certification in this particular situation.

See American Rivers v. FERC , 129 F.3d 99, 108 n.19 (2d Cir. 1997).

28 Thus, the only reasonable interpretation is 26 In the floor debates over the amendmen t to the House bill that recognized the continued validity of a cons truction-related certification for subsequent operating licenses, the amendment sponsor assured his colleague that "the thrust [of a construction-related certification] . . . is that when in operation that facility has to conform to the applicab le water standards . . . ."

115 Cong. Rec. at H9,266 (exchange between Reps. Edmonson and Cramer) (emphasis added).

27 See supra note 22. 28 Petitioners have previously cited American Rivers for the proposition that the Second Circuit has rejected the Fe deral Energy Regulatory Commission's attempt to extend Section 401(a)(3) beyond construction permits and licensing.

Pet. Opp., supra note 15, at 6.

American Rivers only deals with a Federal agency's ability to reject conditions imposed in a State certification, and nowhere addresses whether a certification in suppor t of an operating license may be used to support subsequent operating licen ses. 129 F.3d at 107-11. Moreover, American Rivers in fact supports the multiple use of an operational certification.

It indicates that a State has authority to include conditions in an operational USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 38 of 103 27 that Section 401(a)(3) was necessary to e xpand Section 401(a)(1), not contract it, and to provide added protection to pers ons who had relied on a construction-stage certification. This interpretation is the only one that (1) is consistent with the plain statutory language; (2) is consistent with th e intent of both houses of Congress; and (3) makes sense.

In any event, even if Petitioners we re correct in arguing that only a construction-related certification may be used to support s ubsequent operating licenses, that argument is irrelevant because Vermon t Yankee's WQC was obtained not just to support issuance of the AEC operating license but to support construction-related authorizations as we ll. In particular, the WQC was obtained to fulfill a condition in an order of the Federal Power Commission authorizing use of project lands within its jurisdicti on for both constructi on and operation of "pumping facilities, pipes and conduits, roadways (both auto and rail), stacks, and fences."29 Further, as reflected in Res pondents' Brief, the AEC renewed its certification allowing it to be reopened, amended, or revoked, and shows that Vermont knows how to do so.

Id. at 102-03, 107-11. Thus, Vermont has the ability to issue operational certifications with terms that would require new certification in appropriate circumstances. It simply chose not do so in the WQC issued to Vermont Yankee. In the same vein, Vermont's rules governing 401 certifications include no provisions barring use of prior certifications or specifying applications requiring new certifications.

See Vermont Water Pollution Control Permit Regulations, § 13.11.

29 See Vermont Yankee Nuclear Power Station, Supplement to Environmental Report (Dec. 21, 1971), Vol. II, App. E, Item L (FPC Order Approving Use of Project Lands and Reservoir (July 31, 1970) [DRA28]. In addition, Vermont USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 39 of 103 28 construction permit in Decembe r 1971. Resp. Brief at 13.

Thus, Petitioners' prior statement to this Court that it is "impossi ble" for the original certification to fall within the scope of Section 401(a)(3) (Pet. Opp., supra note 15, at 7) is inaccurate. To the contrary, Section 401(a)

(3) is directly applicable.

Nor is there any validity to Petitioners' claims that NRC's action vitiates Vermont's primacy over and ability to protect local water quality (Pet. Brief at 3, 28). These claims ignore other statutory mechanisms in the CWA for ensuring continued compliance with state water quality standards. Any facility discharging pollutants must before commencing opera tions, and subsequently on a periodic basis, obtain NPDES permits authorizing discharge of pollutants.

See 33 U.S.C. §§ 1311(a) & 1342; 40 C.F.R. §§ 122-136, 4 00-501. While the WQC provides a State's forward-looking prediction that a facility will comply with state standards, it is the NPDES permit that provides States an ongoing means of actually enforcing compliance with state wate r quality standards.

33 U.S.C. §§ 1311(b)(1)(C) & 1342. Indeed, VANR, the Vermont agency actually responsible for water quality certifications and for issuing NPDES perm its, specifically indicated to NRC its Yankee applied to the U.S. Army Corp s of Engineers on June 30, 1971, for a permit to discharge or work in navigable waters under Section 13 of the Rivers and Harbors Act.

See id., Vol. I at 11-5 [DRA13].

Entergy has not located a copy of this application in its files.

By virtue of Petitioners' failure to have properly raised 401 certification as a contention in the proceeding below, has not had the opportunity to pursue this doc ument through discovery under the NRC rules. See 10 C.F.R. § 2.336.

USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 40 of 103 29 satisfaction that "[t]he re quirements of the Clean Water Act and the NPDES permit will provide assurance that the impacts of the permitted intake structures and discharges meet the applicable federal and state requirements."

See supra note 6 (emphasis added).

B. NRC Was Not Required to Indicate Affirmatively Its Reliance on the WQC Identified by Enter gy and Already in NRC's Files There is likewise no merit to Petitioners' claim that the NRC was arbitrary and capricious for failing to note affirmatively its reliance on the existing WQC or NPDES permit identified in the license renewal application (which no party had challenged in a procedurally proper manner before the ASLB).

Pet. Brief at 23-25.

The only support Petitioners marshal for this argument is an out-of-context sentence from City of Tacoma v. FERC , 460 F.3d 53 (D.C. Cir. 2006).

Specifically, Petitioners contend "a federal agency 'has an obligation to determine that the specific certification required by [section 401] has been obtained, and without that certification, [the agency] lacks authority to issue a license.'" Pet. Brief at 23 (quoting City of Tacoma , 460 F.3d. at 68). Thus, Petitioners claim that NRC is required to state affirmatively that it has obtained a WQC whenever it relicenses a facility.

Id. at 24. However, in City of Tacoma , the quoted language is applied to a very different requirement: an agency's affirmative duty to determine whether an initial certification granted by a state complies with the requirements of Section 401.

See City of Tacoma, 460 F.3d at 68 ("This obligation does not require USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 41 of 103 30 [an agency] to inquire into every nuance of the state law proceeding . . . but it does require [the agency] at least to confirm that the state has facially satisfied the express requirements of section 401."). If this were a matter of NRC failing to inquire as to the validity of a new WQC, City of Tacoma would be applicable.

Here, however, the NRC alre ady possessed the valid and verified WQC relied upon by Entergy VY's license renewal application.

27 Indeed, where a State has issued a prior certification with respect to construction, the State has the burden of notifying the federal licensing agency of its intention to revoke within 60 days of the time it is itself notified that a new license application is pending.

Keating , 927 F.2d at 624.

In any event, although an agency is re quired to explain adequately its actions to avoid a finding that those actions were arbitrary and capricious under 5 U.S.C. § 706(2)(A), this requirement is not "particularly demanding" as courts "'will uphold a decision of less than ideal clarity if the agency's path may reasonably be discerned.'"

Public Citizen, Inc. v. FAA , 988 F.2d 186, 197 (D.C. Cir. 1993)

(quoting Bowman Transp., Inc. v. Ar kansas-Best Freight Sys., Inc., 419 U.S. 281, 286 (1974)). Thus, the "ultimate question . . . is whether the c ourt can discern the 27 Petitioners assert that Entergy did not "file" a copy of this WQC or "provide" it to the NRC. Pet. Brief at 5, 16.

The NRC rules, however, provide that an application may incorporate by reference information contained in previous applications, statements, correspondence or reports filed with the Commission, provided that the references are clear a nd specific. 10 C.F.R. § 54.17(e). Thus, there was no need to append the clearly referenced WQC to the application.

USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 42 of 103 31 agency's path, based on the record." Southern Pac. Transp. Co. v. ICC , 69 F.3d 583, 594 (D.C. Cir. 1995) (Rogers, J., dissenting). The burden of showing that an agency's action is without any explan ation falls to the petitioning party.

See Village of Bensenville v. FAA , 457 F.3d 52, 70-71 (D.C. Cir. 2006). In this case, Entergy submitted to NRC an environmental report that explicitly and clearly referenced the extant WQC and NPDES permit. Environmental Report at § 9.2.1 [RA45]. That WQC was already present in NRC's files. The NRC's longstanding practice of recognizing a valid NPDES permit as a proxy for Section 401 certificati ons was already reflected in the NRC's Generic Environmental Impact Statement for License Renewal of Nuclear Plants (1996), at § 4.2.1.1 [RA41-43]. NRC subsequently issu ed a draft and final EIS, neither of which included a new WQC in th e list of certifications that Entergy was still required to provide. Petitioners may demand some explicit statement by the NRC of its possession and the sufficiency of the 1970 WQC and/or NPDES permit referenced by Entergy VY's application to satisfy the requirements of Section 706(2)(A), but NRC's duty was in no way this "demanding."

See Public Citizen , 988 F.2d at 197; see also Honeywell Int'l, Inc. v. EPA , 372 F.3d 441, 448 (D.C. Cir. 2004) (finding that an agency did not act in an arbitrary and capricious fashion when it determined fish were present in a contaminated area even though it never affirmatively stated that the fish could swim the short distance between the USCA Case #11-1168 Document #1364259 Filed: 03/19/2012 Page 43 of 103 32 contaminated zone and where they had been seen);

NARUC v. FCC , 746 F.2d 1492, 1502 (D.C. Cir. 1984) (finding that an agency did not act in an arbitrary and capricious fashion when it relied upon a f actual record already in its possession rather than making new affi rmative findings of fact).

C. The Desirability of Further Ex planation Is At Most Harmless Error Even if this Court were to concl ude that further NRC explanation was desirable (and putting aside the fact that any shortcoming was caused by Petitioners' persistent failure to object to the use of the existing WQC), the absence of a more complete explanation is at most harmless error. Here, neither DPS nor NEC can complain that ther e is any issue regarding Vermont Yankee's compliance with water quality standards, a precept recently confirmed by the Vermont Supreme Court in specific reference to Vermont Yankee. The State of Vermont issued an amended NPDES Discharge Permit to Vermont Yankee, which was provided to the NRC as part of the license renewal application.

30 The issuance of that NPDES permit is predicated upon compliance with wate r quality standards.

31 30 Vermont Yankee Nuclear Power Station, License Renewal Application, Amendment 6 (July 27, 2006) [RA143-97].

31 In re Entergy Nuclear Vermont Yankee Discharge Permit 3-1199 , 189 Vt. 140, 989 A.2d 563, 583 (2009)

(Vermont permits issued upon a determination that "the proposed discharge will not reduce th e quality of the receiving waters below the classification established for them and will not violate any applicable provisions of state or federal laws or regulations."

@@ Line 3: / Line 3: @@
 | issue date = 03/19/2012
 | title = Entergy Final Brief
-| author name = Lewis D R, Martin K P, Zoli E N
+| author name = Lewis D, Martin K, Zoli E
 | author affiliation = Entergy Nuclear Operations, Inc, Goodwin Procter, LLP, Pillsbury, Winthrop, Shaw, Pittman, LLP
 | addressee name =

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