In Yadkin fight, Alcoa loses again: Federal appeals court upholds FERC denial | Citizen
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Tuesday, May 3, 2011

In Yadkin fight, Alcoa loses again: Federal appeals court upholds FERC denial

Posted by on Tue, May 3, 2011 at 2:20 PM

AlcoaDam.jpg

Another setback for Alcoa in its bid to control most of the Yadkin River — and continue to cash the checks from its four hydropower dams — for another 50 years: The DC Circuit Court of Appeals today denied Alcoa's bid to cut North Carolina out of the process and allow the company to deal only with the Federal Energy Regulatory Commission (FERC).

You'll recall that in December North Carolina revoked a critical permit that Alcoa needs in order to ask the FERC for 50 more years after determining that Alcoa withheld important information when it applied for — and was granted — the permit.

Thereafter, Alcoa asked FERC to bypass North Carolina entirely, but FERC said no. Then Alcoa challenged FERC's decision in the federal courts. Today's ruling by the DC Circuit Court would appear to put an end to that workaround, leaving Alcoa back where it started — with no state permit and no access to FERC until it gets one.

Bruce Thompson, a Raleigh attorney and one of Stanly County's lawyers in its case against Alcoa, sent us the DC court's opinion, which is here:

Alcoa_v._FERCpdf.pdf

Thompson's summary:

When the NC administrative law judge stayed the 401 water certification issued by NC DENR, Alcoa petitioned FERC for a declaratory order that the NC DENR had waived its authority by not issuing a certification that was effective and complete within one year. Additionally, Alcoa asked FERC to proceed with the issuance of a 50-year license for the Yadkin Project.

FERC denied Alcoa’s petition, ruling there was no waiver because the State had “act[ed] on” Alcoa Power’s application within one year of its filing

The DC Circuit ruled for FERC, finding that it "agree[s]with the Commission's interpretation of Section 401 in ruling that there was no waiver by the State." Therefore, the court agreed with FERC that it cannot decide whether to issue Alcoa a 50-year license until the litigation regarding Alcoa’s 401 certification is completed.

Interestingly, it is now Alcoa that is pursuing litigation on the state level as NC DENR withdrew the 401 certification last December. NC DENR informed Alcoa that it was revoking Alcoa’s 401 Water Quality Certificate because the company “intentionally withheld information material to determining the project’s ability to meet the State’s water quality standards for dissolved oxygen.”

In the letter, NC DENR tells Alcoa that its “intentional omission is documents, in part, in company e-mails that were entered into evidence at trial over the past few days.” The e-mails are part of the record in an administrative proceeding brought by Stanly County to challenge the 401 Water Quality Certification NC DENR previously granted to Alcoa.

The e-mails contain statements such as:

• “I’m certain that NCDWQ would have a problem if they knew”

• “If we even begin to suggest to DWQ that the enhancements proposed by [Alcoa] for Narrows and High Rock may not allow those tailwaters to meet state standards, DWQ can’t issue us a 401.”

After viewing these e-mails for the first time in court, NC DENR officials moved swiftly to revoke Alcoa’s certification. Alcoa cannot receive a new federal license for the hydro project if it does not have a 401 certification. It is hard to imagine Alcoa claiming it did not mislead NC DENR when the words in those emails speak for themselves.

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