Petition for Writ of Certiorari — Beyond Nuclear, Petitioner v. Nuclear Regulatory Commission, et al.

Supreme Court briefFeb 26, 2018

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App. 1

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

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NO. 15-1173

September Term, 2017

FILED ON: NOVEMBER 27, 2017

BEYOND NUCLEAR, INC.,

PETITIONER

U.S. NUCLEAR REGULATORY COMMISSION

AND UNITED STATES OF AMERICA,

RESPONDENTS

DTE ENERGY COMPANY,

INTERVENOR

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On Petition for Review of an Order

of the Nuclear Regulatory Commission

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Before: GARLAND, Chief Judge, HENDERSON,

Circuit Judge, and EDWARDS, Senior

Circuit Judge.

JUDGMENT

This petition for review was considered on the record from the Nuclear Regulatory Commission (NRC)

and on the briefs filed by the parties. See FED. R. APP.

P. 34(a)(2); D.C. CIR. R. 34(j). The court has accorded

App. 2

the issues full consideration and determined that they

do not warrant a published opinion. See D.C. CIR. R.

36(d). It is

ORDERED AND ADJUDGED that the petition

for review be denied.

Petitioner Beyond Nuclear challenges the NRC’s

decision to grant DTE Electric Company a combined

license to construct and operate a nuclear power plant.

Specifically, it challenges NRC’s denial of petitioner’s:

(1) request to admit for an adjudicatory proceeding an

untimely contention challenging the NRC’s Environmental Impact Statement (EIS); (2) request to consider

that untimely contention at a contested hearing on a

sua sponte basis; and (3) challenge to the adequacy of

DTE’s quality-assurance program. Each argument is

unsuccessful.

We owe an agency’s interpretations of its own procedural regulations substantial deference, giving them

“controlling weight” unless “plainly erroneous or inconsistent with the regulation.” Thomas Jefferson

Univ. v. Shalala, 512 U.S. 504, 512 (1994) (citation

omitted). The NRC did not plainly err in determining

that Beyond Nuclear’s contention regarding the EIS

was untimely under its regulations and was not based

on information that was “not previously available,” 10

C.F.R. § 2.309. Nor did it abuse its discretion in deciding that the issue presented by the contention was

not so “serious” as to warrant sua sponte review in

a contested hearing under 10 C.F.R. § 2.340, because

the EIS did consider the issues presented by the

App. 3

contention and because the NRC had already scheduled a hearing to review the overall sufficiency of the

EIS. See Lorion v. NRC, 785 F.2d 1038, 1042 (D.C. Cir.

1986).

Finally, we reject Beyond Nuclear’s claim that

the NRC was arbitrary and capricious in accepting

DTE’s quality-assurance program. The record does not

support the claim that the NRC ignored undisputed

evidence regarding the program. Rather, the record indicates that the NRC rationally considered all relevant

facts before denying Beyond Nuclear’s challenge to the

program. Nor do the NRC’s regulations support Beyond Nuclear’s assertion that the NRC acted unlawfully in ruling that DTE could rely on the qualityassurance program of its contractor while preparing

its license application, as long as DTE retained responsibility for that work. To the contrary, the regulations

expressly permit an applicant to “delegate to others . . .

the work of establishing and executing” a quality-assurance program, so long as the applicant retains final

responsibility over the program. 10 C.F.R. Pt. 50 App.

Pursuant to D.C. Circuit Rule 36, this disposition

will not be published. The Clerk is directed to withhold

issuance of the mandate herein until seven days after resolution of any timely petition for rehearing or

App. 4

petition for rehearing en banc. See FED. R. APP. P. 41(b);

D.C. CIR. R. 41.

Per Curiam

FOR THE COURT:

Mark J. Langer, Clerk

BY: /s/

Ken Meadows

Deputy Clerk

App. 5

UNITED STATES OF AMERICA

NUCLEAR REGULATORY COMMISSION

COMMISSIONERS:

Stephen G. Burns, Chairman

Kristine L. Svinicki

William C. Ostendorff

Jeff Baran

)

DTE ELECTRIC COMPANY )

Docket No. 52-033-COL

(Fermi Nuclear Power Plant, )

)

Unit 3)

)

In the Matter of

CLI-15-01

MEMORANDUM AND ORDER

(Filed Jan. 13, 2015)

Today we rule on the Atomic Safety and Licensing Board’s request to review, sua sponte, issues relating to the environmental impacts of the proposed

transmission-line corridor for Fermi Unit 3.1 For the

reasons set forth below, we deny the Board’s request

for sua sponte review. In addition, we deny Intervenors’

petition for review of the Board’s dismissal of Contention 23, also relating to transmission-corridor environmental impacts.2

LBP-14-9, 80 NRC ___ (July 7, 2014) (slip op.).

Intervenors’ Petition for Review of Atomic Safety and Licensing Board’s Dismissal of Contention 23 for Lack of Timeliness (Oct. 6, 2014) (Petition). Intervenors are Beyond Nuclear,

App. 6

BACKGROUND

This proceeding concerns DTE’s combined license

application to construct and operate a GE-Hitachi Economic Simplified Boiling Water Reactor (ESBWR) on

the Fermi site in Monroe County, Michigan.3 Intervenors sought a hearing and originally proposed fourteen

contentions; the Board granted a hearing and admitted

four of those contentions.4 Since their entry into the

Citizens for Alternatives to Chemical Contamination, Citizens

Environmental Alliance of Southwestern Ontario, Don’t Waste

Michigan, Sierra Club, Keith Gunter, Edward McArdle, Henry

Newman, Derek Coronado, Sandra Bihn, Harold L. Stokes, Michael J. Keegan, Richard Coronado, George Steinman, Marilyn R.

Timmer, Leonard Mandeville, Frank Mantei, Marcee Meyers, and

Shirley Steinman.

See Detroit Edison Company; Notice of Hearing, and Opportunity To Petition for Leave To Intervene and Order Imposing

Procedures for Access to Sensitive Unclassified Non-Safeguards

Information and Safeguards Information for Contention Preparation on a Combined License for Fermi 3, 74 Fed. Reg. 836 (Jan. 8,

2009).

The Board admitted Contentions 3, 5, 6, and 8. LBP-09-16,

70 NRC 227, 306 (2009). In three separate opinions, the Board

granted summary disposition of Contentions 3, 5, and 6 in favor

of DTE. See Order (Granting Motion for Summary Disposition

of Contention 3) (July 9, 2010) (unpublished); Order (Granting

Motion for Summary Disposition of Contention 5) (Mar. 1, 2011)

(unpublished); LBP-12-23, 76 NRC 445, 452 (2012) (among other

things, granting summary disposition of Contention 6). After an

evidentiary hearing, the Board ruled on the merits of Contention

8 in favor of the NRC Staff and ruled on the merits of a new admitted contention pertaining to quality assurance, Contention 15,

in favor of DTE. LBP-14-7, 79 NRC 451 (2014). In a separate decision, we denied Intervenors’ petition for review of the Board’s

ruling on the merits of Contention 15. See CLI-14-10, 80 NRC ___

(Dec. 16, 2014) (slip op.).

App. 7

proceeding in July 2009, Intervenors have proposed

several additional contentions, including Contention

23, their challenge to the NRC Staff ’s compliance with

the National Environmental Policy Act of 1969 (NEPA)

as it pertains to the anticipated environmental impacts of the proposed transmission line corridor for

Fermi Unit 3, the subject of our decision today.

Intervenors first proposed Contention 23 after the

Staff issued the draft Environmental Impact Statement (EIS) for DTE’s application.5 Later, after the

Board dismissed the contention as late, Intervenors resubmitted Contention 23 in response to the Staff ’s final EIS.6 The Board again dismissed the contention as

late.7 In Contention 23, both as originally proposed and

resubmitted, Intervenors challenged the adequacy of

the Staff ’s consideration of the environmental impacts

of building new transmission lines for Fermi Unit 3.8

See Motion for Resubmission of Contention 10, to Amend/

Resubmit Contention 13, and for Submission of New Contentions

17 through 24 (Jan. 11, 2012), at 1-2, 41-52 (Original Contention

23).

See LBP-12-12, 75 NRC 742, 776-80 (2012); Motion for Resubmission of Contentions 3 and 13, for Resubmission of Contention 23 or its Admission as a New Contention, and for Admission

of New Contentions 26 and 27 (Feb. 19, 2013), at 2, 21-53 (Resubmitted Contention 23).

Licensing Board Memorandum and Order (Denying Intervenors’ Motion for Resubmission of Contentions 3 and 13, for

Resubmission of Contention 23 or its Admission as a New Contention, and for Admission of New Contentions 26 and 27) (Apr.

30, 2013), at 21 (unpublished) (Second Board Ruling).

Compare Original Contention 23 at 41-52, with Resubmitted Contention 23 at 21-53.

App. 8

Although the Board did not admit Contention 23,

it found some merit to Intervenors’ arguments.9 In its

first ruling dismissing the contention, the Board suggested that the contention might have been admissible

if not for its tardiness and recommended that the Staff

consider Intervenors’ concerns when preparing the final EIS.10 In its second ruling, the Board again found

the contention to be unjustifiably late, but it reiterated

its view that Intervenors had raised “a substantial . . .

issue that might have been admissible had it been

timely filed.”11 The Board further observed that the adequacy of the Staff ’s review of transmission-corridor

impacts might be appropriate for the Board’s consideration sua sponte, pursuant to 10 C.F.R. § 2.340(b).12

The Board thus sought briefing from the parties on the

appropriateness of the Board’s taking review of the issues raised in Contention 23 on its own motion.13 Intervenors supported sua sponte review; DTE and the

Staff opposed it.14

See LBP-12-12, 75 NRC at 776-80; Second Board Ruling at

22-23.

LBP-12-12, 75 NRC at 776, 780.

Second Board Ruling at 23.

See id.

Id. at 23-24.

Intervenors’ Memorandum in Support of Sua Sponte ASLB

Referral of Transmission Line Corridor NEPA Compliance Issue

(May 30, 2013); Applicant’s Brief Opposing Sua Sponte Review of

Environmental Impacts in the Offsite Transmission Corridor

(May 30, 2013); NRC Staff Response to Board Order Concerning

Proposed Sua Sponte Review of Contention 23 (May 30, 2013).

App. 9

As it considered the parties’ views on sua sponte

review, the Board proceeded to hearing on Intervenors’

then-pending admitted contentions and issued an initial decision ruling on those contentions in favor of

the Staff and DTE.15 The Board returned to the sua

sponte issue shortly thereafter. In LBP-14-9, the Board

determined that the issues raised in Contention 23

merited sua sponte review.16 In accordance with section

2.340(b), the Board requested our approval to undertake that review.17

We now have before us the briefs that we invited

from the parties in response to the Board’s sua sponte

request,18 as well as a motion from the Nuclear Energy

See supra note 4.

LBP-14-9, 80 NRC at ___ (slip op. at 4).

Id. at ___ (slip op. at 16-17, 58).

Applicant’s Opposition to Sua Sponte Consideration of

Transmission Corridor Issues (July 28, 2014) (DTE Brief); NRC

Staff Response to Commission’s Order Inviting Comments on the

Board’s Request for Approval to Conduct Sua Sponte Review of

Contention 23 (Transmission Lines) (July 28, 2014) (NRC Staff

Brief ); Intervenors’ Motion for Commission Approval of LBP-1409 (Memorandum Determining that Issues Related to Intervenors’

Proposed Contention 23 Merit Sua Sponte Review Pursuant to 10

C.F.R. § 2.340(b) and Requesting Commission Approval) (e-mailed

July 28, 2014 and re-filed on July 30, 2014); Applicant’s Reply

Brief Opposing Sua Sponte Consideration of Transmission Issues

(Aug. 7, 2014); NRC Staff Reply to Other Parties’ Pleadings Related to the Board’s Request for Approval to Conduct Sua Sponte

Review of Contention 23 (Transmission Lines) (Aug. 7, 2014); Intervenors’ Corrected Reply Memorandum in Support of Motion for

Commission Approval of LBP-14-09 (Aug. 8, 2014) (Intervenors’

Reply Brief). Intervenors apparently experienced technical difficulties that prevented their use of the agency’s e-filing system on

July 28, 2014. They e-mailed their reply on July 28, 2014, and

App. 10

Institute (NEI) to file a brief as amicus curiae in this

matter.19 Also pending before us is Intervenors’ petition for review of the Board’s dismissal of Contention

23.20 It makes sense for us to review first whether the

then properly re-filed the document on July 30, 2014. Although

they did not request leave to file their reply out of time, we note

that counsel for Intervenors also filed the same day a declaration

that detailed these technical difficulties in the context of a separate filing in this proceeding. See Intervenors’ Motion for Enlargement of Time to Reply in Support of Petition for Review (July 30,

2014); see also Intervenors’ Reply to DTE Answer Opposing Petition for Review of LBP-14-07 (Ruling for Applicant on Quality Assurance) (July 30, 2014), at n.1; Intervenors’ Reply to NRC Staff

Answer to Petition for Review of LBP-14-07 (Ruling for Applicant

on Quality Assurance) (July 30, 2014), at n.1. We therefore will

consider Intervenors' reply for good cause shown. The same is

true for Intervenors’ re-filed reply dated August 8, 2014 (in which

only the caption appears to have been corrected from what was

filed on August 7, 2014). But see CLI-14-10, 80 NRC at (slip op. at

10 n.41) (observing that failure to comply with agency procedural

rules could result in disciplinary action).

Motion of the Nuclear Energy Institute, Inc. for Leave to

File Amicus Curiae Brief in Response to the Commission’s July 11,

2014 Briefing Order (July 28, 2014); Amicus Curiae Brief of the

Nuclear Energy Institute, Inc. in Response to the Commission’s

July 11, 2014 Briefing Order (July 28, 2014). Our rules of practice

permit persons who are not parties to file a brief amicus curiae “if

a matter is taken up by the Commission under [10 C.F.R.] § 2.341

or sua sponte.” 10 C.F.R. § 2.315(d). Although this rule does not

squarely apply here, it is within our discretion to grant leave for

participation as amicus curiae. See Calvert Cliffs 3 Nuclear Project, LLC and UniStar Operating Services, LLC (Calvert Cliffs

Nuclear Power Plant, Unit 3), CLI-13-4, 77 NRC 101, 104 n.9

(2013). NEI’s motion is unopposed, and we find that its brief

would further contribute to the record. We exercise our discretion

and consider NEI’s brief.

See generally Petition; Order of the Secretary (Sept. 10,

2014) (unpublished) (amending the deadline to file a petition for

App. 11

Board properly dismissed the contention to determine

whether the transmission-corridor impacts issue is litigable in the traditional sense – as a contested matter

between the parties – before turning to the Board’s sua

sponte request. Therefore, we rule on both Intervenors’

petition for review and the Board’s sua sponte request

in today’s decision.21

II.

DISCUSSION

A. Intervenors’ Petition for Review

We will grant a petition for review at our discretion, upon a showing that the petitioner has raised a

substantial question as to whether

review of the Board’s ruling on Contention 23 “[b]ecause the issues raised . . . in [that contention] are intertwined with the

Board’s [sua sponte] request”). DTE and the Staff oppose Intervenors’ petition for review. Applicant’s Opposition to Petition for Review on Contention 23 (Oct. 31, 2014) (DTE Response to Petition);

NRC Staff Response to Intervenors’ Petition for Review of Atomic

Safety and Licensing Board’s Dismissal of Contention 23 for Lack

of Timeliness (Oct. 30, 2014) (NRC Staff Response to Petition).

Intervenors filed a reply. Intervenors’ Reply in Support of Petition

for Review of Atomic Safety and Licensing Board’s Dismissal of

Contention 23 for Lack of Timeliness (Nov. 10, 2014) (Reply).

Intervenors expressed concern in their petition for review

that we would treat their contention as “legally intertwined” with

the Board’s request. Petition at 11-13; Reply at 1-5. We clarify

that we do not view the two matters as legally intertwined but

rather factually (and procedurally) intertwined. Although we address both matters in this decision, we consider them separately.

App. 12

(i)

a finding of material fact is clearly erroneous

or in conflict with a finding as to the same fact

in a different proceeding;

(ii) a necessary legal conclusion is without governing precedent or is a departure from or

contrary to established law;

(iii) a substantial and important question of law,

policy, or discretion has been raised;

(iv) the conduct of the proceeding involved a prejudicial procedural error; or

(v) any other consideration that we may deem to

be in the public interest.22 Intervenors seek

review of the Board’s dismissal of the resubmitted version of Contention 23; they do not

request review of the Board’s dismissal of the

contention as originally proposed.23

Intervenors claim that the Board erred when it

found late the version of Contention 23 that was submitted in response to the Staff ’s final EIS.24 Intervenors focus their argument on dicta in the Board’s first

ruling in which the Board recommended that the Staff

consider Intervenors’ transmission-corridor claims when

preparing the final EIS.25 They assert that the Board’s

recommendation to the Staff constituted new information, a new “dispute” with the draft EIS, that cured

10 C.F.R. § 2.341(b)(4)(i)-(v).

See Petition at 1. We discuss both Board decisions here,

however, for completeness.

Id. at 2-3.

Id. at 2-3, 6-11.

App. 13

the contention’s lateness the second time around.26 Intervenors also assert that language in the final EIS

relating to the transmission corridor is materially different from that in the draft EIS. They argue that this

language raises an issue suitable for a new contention.27

Intervenors acknowledge that they could have

raised Contention 23 at the outset of this proceeding.28

They assert that they purposely waited to see whether

the Staff would supplement the analysis provided in

DTE’s environmental report at the draft EIS stage and

that they again waited to see whether the Staff would

take on the Board’s recommendation in the final EIS.

But our rules of practice require contentions to be

raised at the earliest possible opportunity.29 And although environmental contentions are, in essence,

Id. at 7-8.

Id. at 8-11.

See id. at 3-4, 6.

See 10 C.F.R. § 2.309(b)(3)(i), (c). We amended our rules of

practice in 2012, including the provision governing new or amended

contentions in section 2.309(c). The standard for admitting a new

or amended contention, however, was simplified rather than overhauled. See Final Rule, Amendments to Adjudicatory Process

Rules and Related Requirements, 77 Fed. Reg. 46,562, 46,571

(Aug. 3, 2012) (Part 2 Amendment). Both before and after the

2012 amendment, proponents of new or amended contentions

were, and are, required to demonstrate “good cause” for their filing, which includes a demonstration that the information on which

the new or amended contention is based is materially different

from information previously available. See 10 C.F.R. § 2.309(c)(1)(i)(iii); Part 2 Amendment, 77 Fed. Reg. at 46,571 (focusing the requirements on the factor given the most weight – “good cause”).

App. 14

challenges to the Staff ’s compliance with NEPA, those

contentions must be raised, if possible, in response to

an applicant’s environmental report.30 Petitioners who

choose to wait to raise contentions that could have

been raised earlier do so at their peril. They risk the

possibility that there will not be a material difference

between the application and the Staff ’s review documents, thus rendering any newly proposed contention

on previously available information impermissibly

late.31

Contrary to Intervenors’ claims, the Board’s recommendation to the Staff in its first decision did not

create a new reference point for determining whether

the information raised in the second iteration of Contention 23 was timely raised. Our rules of practice require a material difference between the information

on which the contention is based and the information

that was previously available – for example, a difference between the environmental report and the draft

EIS or the draft EIS and the final EIS.32 In both of

its contention admissibility decisions the Board noted

Intervenors’ failure to point to any material difference between DTE’s or the Staff ’s environmental

documents. The Board was “satisfied that each of the

10 C.F.R. § 2.309(f)(2); see also Part 2 Amendment, 77 Fed.

Reg. at 46,566-67.

See 10 C.F.R. § 2.309(c); see also Entergy Nuclear Generation Co. and Entergy Nuclear Operations, Inc. (Pilgrim Nuclear

Power Station), CLI-12-10, 75 NRC 479, 492-94 (2012).

10 C.F.R. § 2.309(c), (f)(2); see also Pilgrim, CLI-12-10, 75

NRC at 488-89; Pa’ina Hawaii, LLC, CLI-10-18, 72 NRC 56, 8788 (2010).

App. 15

issues that comprise the subject matter of the contention was discussed in the [Environmental Report]” and

that “[t]he same issues were also reviewed in the

[draft] EIS.”33 We see nothing that would cause us to

disturb the Board’s rulings on the timeliness of Contention 23 in this regard.

On appeal, Intervenors point to language in the final EIS that they claim is materially different from information in the draft EIS.34 But as the Staff and DTE

point out, Intervenors compare language from two distinct sections of the Staff ’s review documents.35 When

the same sections of both documents are properly

aligned, there is in fact no difference between the draft

EIS and the final EIS, let alone a material difference.36

Therefore, this claim must fail. Because Intervenors

have not demonstrated a substantial question warranting review of the Board’s dismissal of their contention, we deny their petition for review.

Second Board Ruling at 21; see also LBP-12-12, 75 NRC at

775-76.

See Petition at 8-11.

NRC Staff Response to Petition at 13-14; DTE Response to

Petition at 10-12.

Compare “Draft Environmental Impact Statement for

Combined License (COL) for Enrico Fermi Unit 3” (Draft Report

for Comment), NUREG-2105 (Oct. 2011), at 2-45, 3-17 (ADAMS

accession no. ML13274A468 (package)) (DEIS), with “Environmental Impact Statement for the Combined License (COL) for Enrico Fermi Unit 3” (Final Report), NUREG-2105, Vols. 1-4 (Jan.

2013), at 2-46, 3-18 (ML12307A172, ML12307A176, ML12307A177,

and ML12347A202) (FEIS).

App. 16

B. The Board’s Request for Sua Sponte Review

We turn now to whether issues pertaining to

transmission-corridor environmental impacts should

nevertheless be litigated in a contested proceeding before the Board. The Board specifically requests our approval to review two issues sua sponte:

(1) “[w]hether the building of offsite transmission

lines intended solely to serve . . . Fermi Unit 3

qualifies as a connected action under NEPA

and, therefore, requires the Staff to consider

its environmental impacts as a direct effect of

the construction of Fermi Unit 3”; and

(2) “[w]hether the Staff ’s consideration of environmental impacts related to the transmission corridor, performed as a cumulative

impact review, satisfied NEPA’s hard look requirement.”37

Section 2.340(b) sets forth the standard for sua

sponte review in a combined license proceeding. With

our express approval, a licensing board may make findings on a “serious safety, environmental, or common

defense and security matter” not put into controversy

by the parties.38 This authority shall be used only in

extraordinary circumstances.39 We find that the two

LBP-14-9, 80 NRC at ___ (slip op. at 16).

10 C.F.R. § 2.340(b).

Statement of Policy on Conduct of Adjudicatory Proceedings, CLI-98-12, 48 NRC 18, 22-23 (1998). The Board notes the

absence of an express regulatory requirement that the authority

for sua sponte review be used “sparingly” or in “extraordinary

App. 17

issues identified by the Board do not merit sua sponte

review.

The Board appears to have focused on the distinctions between a direct impacts analysis and a cumulative impacts analysis, with the underlying conclusion

that a cumulative impacts analysis will yield a shallower analysis than a direct impacts analysis. While

that may be true in other cases, here the Staff has included what appears to be a comprehensive analysis of

transmission-corridor impacts throughout the final

EIS. Without commenting on the sufficiency of the

Staff ’s review, we note that the Staff discussed transmission-corridor impacts in Chapters 2, 3, 4, 5, 9, and

10 of the final EIS, in addition to referencing those impacts in the cumulative impacts analysis in Chapter

7.40

circumstances.” LBP-14-9, 80 NRC at ___ (slip op. at 17-19). But

our 1998 Policy Statement, which instructs boards to limit their

use of sua sponte review, remains valid. Further, section 2.340(b)

references the standard for Commission review in sections 2.323

and 2.341, both of which, we have held, require a heightened

showing to prevent overuse, including a demonstration of “extraordinary circumstances.” See 10 C.F.R. §§ 2.323(f), 2.341(f )(1)

(governing referred rulings or certified questions that raise “significant and novel legal or policy issues” or issues whose early resolution “would materially advance the orderly disposition of the

proceeding”); Pacific Gas and Electric Co. (Diablo Canyon Nuclear

Power Plant), CLI-12-13, 75 NRC 681, 685 (2012); cf. Diablo Canyon, CLI-12-13, 75 NRC at 687 (regarding the standard for interlocutory review). The Board correctly notes that “a request to

engage in sua sponte review should not be undertaken lightly.”

LBP-14-9, 80 NRC at ___ (slip op. at 19).

See FEIS at M-1 to M-2.

App. 18

The final EIS itself is a source of minor confusion.

Despite the final EIS’s introductory statement that

preconstruction activities (which would include transmission-line development) are not part of the proposed

action and are discussed in the context of cumulative

impacts,41 the Staff further stated that it included “pertinent information related to . . . potential impacts

from the transmission lines” as part of its “integrated

evaluations of potential environmental impacts from

the proposed Fermi 3 facilities.”42 Consequently, the

Board’s discussion as to whether development of the

transmission corridor is a “connected action” under

NEPA, while thorough, is inapposite.43 The Board’s

treatment of this issue does not acknowledge that the

Staff did discuss the proposed transmission corridor in

the final EIS, across multiple chapters, together with

the impacts of constructing and operating Fermi Unit

3.44 The first issue proposed for review would therefore

appear to be moot.45

FEIS at 1-7. The Board referenced this statement in its

sua sponte request. See LBP-14-9, 80 NRC at ___ (slip op. at 15).

FEIS at M-1.

See LBP-14-9, 80 NRC at ___ (slip op. at 20-42).

See, e.g., FEIS at 4-3 (explaining that due to its collaboration with the United States Army Corps of Engineers in the environmental review, “the combined impacts of . . . preconstruction

and construction activities . . . are presented in [Chapter 4]” even

though “the environmental effects of preconstruction activities on

each resource area would be addressed as cumulative impacts

normally presented in Chapter 7”).

In any event, the Board apparently has already established a position on this issue – after briefing from the parties –

that the transmission corridor is “connected” to the licensing

App. 19

Moreover, much of the Board’s request fundamentally challenges the agency’s Limited Work Authorization Rule.46 For example, the Board takes issue with

the Staff ’s classification of the proposed transmission

lines as a “preconstruction activity” rather than “construction.”47 In the Limited Work Authorization Rule,

however, we expressly excluded transmission lines

from the delineated “construction” activities that would

require NRC approval before being undertaken.48 We

would not allow a litigant to challenge a rule in an

NRC adjudicatory proceeding absent a showing of special circumstances;49 we likewise will not allow the

Board to do the same.50

decision for Fermi Unit 3. See LBP-14-9, 80 NRC at ___ (slip op.

at 27-28) (opining, “based on the information . . . before the

Board,” that the transmission corridor appears to be a proposed

action and that it has “ ‘no discernible purpose’ apart from connecting Fermi 3 to the grid”). For these reasons, further litigation

of this issue would not significantly inform the record on the “connected action” question.

See, e.g., LBP-14-9, 80 NRC at ___ (slip op. at 30-41); see

generally Final Rule, Limited Work Authorizations for Nuclear

Power Plants, 72 Fed. Reg. 57,416 (Oct. 9, 2007) (Limited Work

Authorization Rule).

LBP-14-9, 80 NRC at ___ (slip op. at 28-29).

See 10 C.F.R. §§ 50.10(a)(2)(vii), 51.4 (defining “construction”); see also Limited Work Authorization Rule, 72 Fed. Reg. at

57,417 (requiring NRC authorization “only before undertaking activities that have a reasonable nexus to radiological health and

safety and/or common defense and security”).

See 10 C.F.R. § 2.335(a), (b).

See LBP-14-9, 80 NRC ___ (slip op. at 31-32).

App. 20

The Board’s second issue proposed for review,

aside from its reference to cumulative impacts, is in essence a concern about the overall sufficiency of the

Staff ’s transmission-corridor analysis. But this is a potentially amorphous issue that does not appear to lend

itself well to a contested proceeding, and the Board has

not given us the benefit of a roadmap of what specifically would be litigated with regard to the Staff ’s analysis. For example, the Board opines that the Staff must

evaluate reasonable alternatives as well as measures

to mitigate any detrimental environmental impacts.51

But again, without making a sufficiency finding, the

Staff discussed the proposed transmission corridor in

its alternatives analysis (including alternative sources

of electricity and alternative sites) and also discussed

potential mitigation measures for constructing new

transmission lines in its main analysis of the impacts

of constructing and operating Fermi Unit 3.52 Our rules

See id. at ___ (slip op. at 23-25, 51).

See, e.g., FEIS at 4-60 (noting “that the small streams that

would be crossed by the proposed transmission line corridor could

be easily spanned without placing structures in stream channels

and that [best management practices] would be implemented to

protect water quality in streams during building activities”); id.

at 9-7 (noting that “new transmission lines would be needed to

deliver power from the alternative coal-fired plant and that these

lines would be identical in both capacity and location to the lines

being proposed to support Fermi 3”); id. at 9-87 (noting that

“[e]nvironmental conditions along the transmission line corridor

[for the alternative Belle River-St. Clair site] are similar to those

of the site, with a mixture of cropland, wooded areas, and some

wetlands”).

App. 21

of practice are designed to avoid such an unfocused inquiry in contested proceedings.53

In February of this year, we will be holding the uncontested hearing on the Fermi combined license application. The uncontested hearing will provide us with

an opportunity to review the sufficiency of the Staff ’s

environmental (and safety) analyses. Given that the

Board’s request, at bottom, questions the sufficiency of

the Staff ’s consideration of the environmental impacts

of the proposed new transmission lines for Fermi Unit

3, the issue whether the Staff has taken a “hard look”

at the environmental impacts of the transmission corridor is among the range of issues that are appropriately before us in the uncontested hearing.54 Thus, as

See 10 C.F.R. § 2.309(f )(1)(i)-(vi). The Board, to be sure, is

not strictly bound by the contention admissibility rules when requesting approval to review issues sua sponte. But our contested

proceedings must be governed by some level of specificity to ensure the proceeding is conducted efficiently, with fairness to all of

the parties. Cf. Final Rule, Rules of Practice in Domestic Licensing Proceedings – Procedural Changes in the Hearing Process, 54

Fed. Reg. 33,168, 33,179 (Aug. 11, 1989) (amending the rules of

practice to “ensure[ ] that the resources of all participants in NRC

proceedings are focused on real issues and disputes among the

parties”).

We reject Intervenors’ argument that the uncontested

hearing “is not a serious avenue of relief.” Intervenors’ Reply Brief

at 10. As the Intervenors note, compliance with NEPA is the responsibility of the NRC. See Petition at 3, 6. In the uncontested

hearing it is our duty to ensure, among other things, that we have

adhered to our obligations under that statute. See 10 C.F.R.

§ 51.107(a). We therefore find the uncontested proceeding to

be an appropriate venue in which to address the transmissioncorridor issue.

App. 22

part of this hearing, we will take the Board’s concerns

regarding examination of the environmental impacts

of the transmission corridor in the final EIS under advisement.

III. CONCLUSION

Intervenors have failed to raise a substantial

question warranting review of the Board’s dismissal of

Contention 23. We therefore deny the petition for review. In addition, we deny the Board’s request for sua

sponte review. We will review the adequacy of the

Staff ’s environmental review, including consideration

of transmission-corridor environmental impacts, as

part of the uncontested hearing.

IT IS SO ORDERED.

For the Commission

NRC Seal

/s/

/RA/

Annette L. Vivetti-Cook

Secretary of the Commission

Dated at Rockville, Maryland,

this 13th day of January, 2015.

Concurring Opinion of Commissioner Baran

I concur in the result of the memorandum and order but write separately to respectfully express my disagreement with the majority’s treatment of the

Board’s request for sua sponte review in section IIB. In

my view, this portion of the opinion would benefit from

App. 23

a more tailored discussion of only those issues necessary to reach a decision. I do not believe it is necessary

for the opinion to characterize the Board’s request for

sua sponte review as “fundamentally challeng[ing]” the

Limited Work Authorization Rule, the Board as having

“already established a position” on the question of

whether the transmission corridor construction is a

connected action under NEPA, or the requested review

of the Staff ’s transmission corridor analysis as “potentially amorphous” and “unfocused.” I also do not believe that it makes sense for the opinion to state that

“the Staff has included what appears to be a comprehensive analysis of transmission-corridor impacts

throughout the final EIS.” This description of the

Staff ’s analysis as “comprehensive” could leave readers with the impression that the Commission is prejudging the sufficiency of the final EIS in advance of

the uncontested hearing. The juxtaposition of this description with the subsequent statement that the Commission is not “commenting on the sufficiency of the

Staff ’s review” may also confuse readers.

For these reasons, this section of the memorandum and order could simply state:

With respect to whether the building of offsite

transmission lines for Fermi Unit 3 qualifies

as a connected action under NEPA, the Board’s

request for sua sponte review appears relevant only to determining if an analysis of the

direct effects of such activities is warranted.

However, the Staff examined the impacts of

the proposed transmission corridor on land

App. 24

use, terrestrial ecology, aquatic ecology, historic and cultural resources, and nonradiological health in Chapters 2, 3, 4, 5, 9, and 10 of

the final EIS, in addition to referencing those

impacts in the cumulative impacts analysis in

Chapter 7. Without commenting on the sufficiency of the review, there is no question that

the Staff discussed the environmental impacts of the proposed transmission corridor

in multiple chapters of the final EIS. Consequently, a sua sponte review by the Board of

the legal question of whether a direct effects

analysis was required is unnecessary. At their

core, both issues raised by the Board relate to

the sufficiency of the Staff ’s consideration of

the environmental impacts of the proposed

new transmission corridor for Fermi Unit 3.

The upcoming uncontested hearing is a natural time for the Commission to examine

whether the Staff has taken the requisite

“hard look” at the environmental impacts of

the transmission corridor in its final EIS.

[Certificate Of Service Omitted]

App. 25

LBP-14-09

UNITED STATES OF AMERICA

NUCLEAR REGULATORY COMMISSION

ATOMIC SAFETY AND LICENSING BOARD

Before Administrative Judges:

Ronald M. Spritzer, Chairman

Dr. Anthony J. Baratta

Dr. Randall J. Charbeneau

In the Matter of

Docket No. 52-033-COL

DETROIT EDISON

COMPANY

ASLBP No.

09-880-05-COL-BD01

(Fermi Nuclear Power

Plant, Unit 3)

July 7, 2014

MEMORANDUM

(Determining that Issues Related to Intervenors’

Proposed Contention 23 Merit Sua Sponte

Review Pursuant to 10 C.F.R. § 2.340(b)

and Requesting Commission Approval)

[2] Table of Contents

I. BACKGROUND................................................. - 4 A.

The Fermi 3 Transmission Corridor ........ .- 4 -

B. The Draft Environmental Impact Statement .................................................................. - 6 C. The NRC’s changing position on its authority to impose environmental restrictions

App. 26

on transmission lines that serve nuclear

power plants ..................................................... - 7 D.

Contention 23 .......................................... - 10 -

E. The Board’s Ruling on Proposed Contention 23 ............................................................. - 12 F.

EPA comments on the DEIS .................... - 13 -

G. The Final Environmental Impact Statement ................................................................ - 14 H. The Board’s ruling on re-submitted Contention 23 ........................................................ - 15 II. BOARD DETERMINATION, SUPPORTING

ANALYSIS, AND REQUEST FOR COMMISSION

APPROVAL ............................................................ - 16 A.

The Standard for Sua Sponte Review .... - 17 -

NEPA Requirements ............................... - 19 1. The Scope of an EIS .......................... - 20 2. The FEIS must evaluate all reasonably foreseeable environmental impacts of

the proposed action ................................. - 22 3. The FEIS must evaluate alternatives

to the proposed action, including mitigation ........................................................... - 23 4. Cumulative Impacts ......................... - 24 5.

Limitation on actions ........................ - 24 -

C. There is a serious question whether the

building of an offsite transmission corridor intended solely to serve the new Fermi Unit 3

qualifies as a connected action under NEPA

and, therefore, requires the Staff to consider

App. 27

its environmental impacts as a direct effect of

the construction of Fermi Unit 3 ................... - 25 1. Proposed Action ................................ - 26 2.

Independent Utility .......................... - 27 -

Federal Control and Responsibility ... - 28 -

4. The 2007 LWA Rule and Statement of

Considerations ......................................... - 34 5. Impact of Excluding Transmission

Corridor from the Scope of Proposed Action ........................................................... - 39 6. Conclusion ......................................... - 42 [3] D. There is a serious question whether

the Staff ’s consideration of environmental

impacts related to the transmission corridor,

performed as a cumulative impact review, satisfies NEPA’s hard look requirement ............ - 42 1. Unavailable or Incomplete Information ........................................................... - 48 2. Reliance on Anticipated Certifications ......................................................... - 49 3.

Inadequate Analysis of Mitigation ... - 51 -

4. Conclusion ......................................... - 52 E.

Sua Sponte Review is Warranted ........... - 52 -

III. CONCLUSION ............................................. - 58 [4] Before the Licensing Board is the question we

raised in our Order of April 30, 2013: whether Intervenors’ proposed Contention 23, although untimely filed,

is appropriate for sua sponte Board review pursuant to

App. 28

10 C.F.R. § 2.340(b).1 Contention 23 alleged that the

Staff ’s Draft and Final Environmental Impact Statements for the Fermi Unit 3 project failed to adequately

evaluate the environmental impacts of the new highvoltage transmission line corridor that will be constructed to serve the Project. For the reasons explained

below, the Board determines that two issues arising

from the contention merit sua sponte review.2 The

Board therefore respectfully requests that the Commission approve the Board’s determination that sua

sponte review is warranted pursuant to § 2.340(b).

BACKGROUND

A. The Fermi 3 Transmission Corridor

This combined license (“COL”) contested proceeding involves the application of DTE Electric Company

(formerly the Detroit Edison Company) (“Applicant” or

“DTE”) under 10 C.F.R. Part 52, Subpart C, to construct

and operate a GE-Hitachi Economic Simplified Boiling

Water Reactor (“ESBWR”), designated Unit 3, on its

existing Fermi nuclear facility site in Monroe County,

Michigan.3

Licensing Board Order (Denying Intervenors’ Motion for

Resubmission of Contentions 3 and 13, for Resubmission of Contention 23 or its Admission as a New Contention, and for Admission of New Contentions 26 and 27), at 22-24 (Apr. 30, 2013)

(unpublished) [hereinafter Denial Order].

The two specific issues are identified infra Section II.

Letter from Jack M. Davis, DTE, to NRC, Detroit Edison

Company Submittal of a Combined License Application for Fermi

App. 29

[5] Fermi Unit 3 will require the construction and

operation of transmission lines to connect it to the grid.

The Final Environmental Impact Statement (“FEIS”)

explains the current status of plans for the transmission lines and the transmission corridor4 in which the

lines will be located:

ITC Transmission has not yet formally announced a route for the offsite portion of the

proposed new transmission line serving Fermi

3. Detroit Edison expects that the proposed

new transmission line would be built within

the existing Fermi 2 transmission corridor for

approximately 18.6 mi extending outward

from the Fermi site boundary. Detroit Edison

expects that the remaining 10.8 mi, extending

to the Milan Substation, would be built within

an undeveloped right-of- way (ROW) possessed but not yet used by ITC Transmission.5

The FEIS estimates the total acreage to be occupied by the new transmission corridor as 1069.2 acres,

assuming a 300-foot-wide corridor.6 The FEIS states

that the Fermi 3 site includes 1260 acres.7 The latter

3 (NRC Project No. 757) (Sept. 18, 2008) (ADAMS Accession No.

ML082730763).

We will refer to the transmission lines and the corridor in

which they will be constructed as “the transmission corridor.”

Division of New Reactor Licensing, Office of New Reactors,

Final Environmental Impact Statement for the Combined Licensed (COL) for Enrico Fermi Unit 3, NUREG-2015, at 2-10

(Jan. 2013) [hereinafter FEIS] (citations omitted).

FEIS at 2-47 (Table 2-7).

Id. at 2-5.

App. 30

figure includes the entire Fermi tract owned by DTE,

including, but not limited to, the land where Fermi

Unit 3 would be constructed.8 The FEIS further reports:

The western 10.8-mi segment of the proposed

transmission corridor, which does not follow

previously cleared and regularly maintained

corridors, crosses a mosaic of pastures and forest, including forested wetlands, shrub/scrub,

cropland, and developed land. Forested and

emergent wetlands are present, and three

wetlands extend more than 900 ft along the

corridor. It is possible that towers may need to

be placed in these wetlands in order to construct crossings. The proposed Milan Substation site is located entirely in an area of

cropland and planted grassland.9

[6]

The Draft Environmental Impact Statement

On October 28, 2011, the NRC Staff and the U.S.

Army Corps of Engineers (“USACE” or “the Corps”)

published the Draft Environmental Impact Statement

(“DEIS”) for the Fermi Unit 3 COL.10 The DEIS states

that the new transmission corridor for Fermi Unit 3

will be built and operated by ITC Transmission.11 ITC

Id.

Id. at 2-46 to 2-47 (citations omitted).

Office of New Reactors, Draft Environmental Impact

Statement for Combined License (COL) for Enrico Fermi Unit 3,

NUREG 2015, Vol. 1 (Oct. 2011) (ADAMS Accession No.

ML11287A108) [hereinafter DEIS].

Id. at 2-10.

App. 31

Transmission operated as a wholly owned subsidiary

of DTE until 2004.12

The DEIS further explained that the NRC categorizes the construction of transmission lines as a “preconstruction activity.”13 Preconstruction activities

include various actions required to construct a nuclear

power plant that, as the result of changes to agency

regulatory policy made by the 2007 limited work authorization rule (“2007 LWA Rule”), the NRC now defines as outside its regulatory authority and therefore

not part of the NRC action to license the proposed new

plant.14 Such preconstruction activities include, in addition to the construction of transmission lines, “clearing and grading, excavating, dredging, discharge of fill,

erection of support buildings . . . , and other associated

activities.”15 Because preconstruction activities are no

longer included within the scope of the proposed NRC

action, the Staff concluded it was not [7] required to

evaluate their impacts as a direct effect of the NRC action. “Rather, the impacts of the preconstruction

Applicant’s Brief Opposing Sua Sponte Review of Environmental Impacts in the Offsite Transmission Corridor (May 30,

2013) unnumbered attach. at 2 (Affidavit of Peter Smith on

Transmission Corridor Topics (May 30, 2013) [hereinafter Smith

Affidavit]) [hereinafter Applicant Brief].

DEIS at 1-6.

Id. (citing Final Rule, Limited Work Authorizations for

Nuclear Power Plants, 72 Fed. Reg. 57416 (Oct. 9, 2007)).

Id.

App. 32

activities are considered in the context of cumulative

impacts.”16

[7]

C. The NRC’s changing position on its authority

to impose environmental restrictions on transmission lines that serve nuclear power plants

The Commission’s position on the regulation of

transmission lines for nuclear power plants has

changed over several decades.

Prior to the 1969 enactment of [the National

Environmental Policy Act (“NEPA”)], the

Commission perceived its duties under the

Atomic Energy Act primarily in terms of protecting the public from radiation hazards.

NEPA, however, made “environmental protection a part of the mandate of every federal

agency and department . . . (The Commission)

is not only permitted, but compelled, to take

environmental values into account” in carrying out its regular functions. Under NEPA,

federal agencies must “use all practicable

means” to avoid environmental “degradation”

to the extent consistent with “other essential

considerations of national policy.” Thus, in the

early 1970’s the Commission began to consider the environmental implications of proposed nuclear facilities.17

Id.

Detroit Edison Co. v. NRC, 630 F.2d 450, 451 (6th Cir.

1980) (footnote and citations omitted) (quoting Calvert Cliffs Coordinating Comm., Inc. v. Atomic Energy Comm’n, 449 F.2d 1109,

1112 (D.C. Cir. 1971) and 42 U.S.C. § 4331(b)).

App. 33

In 1972, following enactment of NEPA,18 the Commission adopted a major amendment to the definition

of construction in 10 C.F.R. § 50.10(c) that generally

prohibited, absent an NRC construction permit, “any

clearing of land, excavation, or other substantial action

that would adversely affect the natural environment of

a site and construction of non-nuclear facilities (such

as turbogenerators and turbine buildings) for use in

connection with the facility. . . .”19 This prohibition ensured that environmentally damaging activities related to construction of a new nuclear power plant

would not occur before the agency’s EIS was completed

and the agency had balanced the benefits of all aspects

of the project against their environmental costs. The

Commission explained that this expansion of its permitting authority was

[8] consistent with the direction of the Congress, as expressed in Section 102 of the

NEPA, that, to the fullest extent possible, the

policies, regulations, and public laws of the

United States shall be interpreted and administered in accordance with the policies set

forth in that Act. Since site preparation

constitutes a key point from the standpoint

of environmental impact, in connection with

the licensing of nuclear facilities and materials, these amendments will facilitate consideration and balancing of a broader range of

realistic alternatives and provide a more

National Environmental Policy Act of 1969, 42 U.S.C

§ 4321 (2012).

37 Fed. Reg. 5745, 5748 (Mar. 21, 1972).

App. 34

significant mechanism for protecting the environment during the earlier stages of a project for which a facility or materials license is

being sought.20

Thus, “[b]y 1974, the Commission had adopted an

aggressive approach to its environmental responsibilities in the context of transmission line siting.”21 In that

year, an Atomic Safety and Licensing Appeal Board, rejecting a legal challenge by Detroit Edison, ruled that

the Commission could, as a condition of licensure, insist that off-site transmission lines built solely to serve

a nuclear facility be designed to minimize environmental disturbance.22 The United States Court of Appeals

for the Sixth Circuit, whose jurisdiction includes Michigan, subsequently upheld the Commission’s policy.23

In 2007, however, the NRC altered its regulatory

approach, stating that changes were needed to allow

some non-safety related activities to begin earlier than

allowed under the regulations then in effect.24 The preamble to the 2007 LWA Rule explains:

[T]he nuclear power industry has reviewed

the overall construction process based upon

lessons learned from the construction and licensing process used for currently operating

reactors. The industry submitted what is

Id. at 5746.

Detroit Edison, 630 F.2d at 451.

Detroit Edison Co. (Greenwood Energy Ctr., Units 2 & 3),

ALAB-247, 8 AEC 936 (1974).

Detroit Edison, 630 F.2d at 450.

72 Fed. Reg. at 57426.

App. 35

essentially a petition for rulemaking seeking

changes to the LWA process, reflecting those

lessons learned and their understanding of

the current state of NEPA law. The NRC has

reviewed the applicable law, and for the reasons stated elsewhere in this [statement of

considerations], agrees with the petitioner

that the current definition of construction and

the current LWA requirements in § 50.10 are

not compelled by NEPA or the Atomic Energy

Act (AEA) of 1954, as amended. While the [9]

agency’s regulations on construction and

LWAs were a reasonable implementation of

NEPA as understood in 1972, the NRC believes that, with more than 30 years experience in implementing NEPA and the evolving

jurisprudence, the time is appropriate for reconsideration and revamping of these NRC

requirements.25

Accordingly, the 2007 LWA Rule revised 10 C.F.R.

§ 50.10 and made conforming changes in 10 C.F.R.

Parts 2, 51, and 52. The rule narrowed the scope of

activities requiring permission from the NRC in the

form of an LWA by eliminating the concept of “commencement of construction” formerly described in

§ 50.10(c) and the authorization formerly described in

§ 50.10(e)(1).26

Instead, under the final LWA rule, NRC authorization would only be required before undertaking activities that have a reasonable

Id. at 57420.

Id. at 57426.

App. 36

nexus to radiological health and safety and/or

common defense and security for which regulatory oversight is necessary and/or most effective in ensuring reasonable assurance of

adequate protection to public health and

safety or common defense and security.27

Thus, the building of transmission lines to serve a nuclear power plant is no longer classified as a construction activity and no longer requires authorization from

the NRC.28 The agency’s NEPA regulations (10 C.F.R.

Part 51) also exclude the building of transmission lines

from the definition of “construction.”29

An NRC Staff member, commenting on the proposed 2007 LWA Rule, contended that the proposal was

inconsistent with NEPA:

The impacts of the construction of a nuclear

power plant that NRC now proposes to exclude from NRC regulations are probably 90

percent of the true environmental impacts of

construction. Before even talking to the NRC,

a power company can clear and grade the

land, build roads and railroad spurs, erect permanent and temporary buildings, build numerous plant structures (e.g., cooling water

intake and discharge, cooling towers), and

build switchyards and [10] transmission lines.

After potentially doing all of that, THEN the

company would come to the NRC and ask

Id.

10 C.F.R. § 50.10(a)(2)(vii).

Id. § 51.4(1)(ii)(G).

App. 37

permission to build the power plant for which

all of this work was done. How does this comply with NEPA?30

In response, the NRC stated that

the pre-construction private actions of clearing, grading, access road construction, etc.,

will be considered in the cumulative impacts

analysis in the LWA EIS as the baseline for

analyzing the environmental impacts associated with the Federal action authorizing LWA

activities. This information will be used when

evaluating the environmental impacts of construction and operation of the proposed nuclear power plant.31

D. Contention 23

Intervenors filed a number of proposed new contentions in response to the DEIS. Among these was

proposed Contention 23, which alleged that:

The high-voltage transmission line portion of

the project involves a lengthy corridor which

is inadequately assessed and analyzed in the

Draft Environmental Impact Statement.32

Intervenors claimed that the DEIS’s discussion of

“the environmental impacts to the approximately

72 Fed. Reg. at 57420.

Id.

Motion for Resubmission of Contention 10, to Amend/Resubmit Contention 13, and for Submission of New Contentions 17

through 24, at 41 (Jan. 11, 2012).

App. 38

1,000 acres of transmission corridor is deficient in a

host of ways.”33 For example, Intervenors emphasized

that substantial construction will take place in undeveloped wetlands, forests, and grasslands:

NRC reports that “the final western 10.8

miles of transmission lines would be built in

an undeveloped segment of an existing transmission ROW . . . Some transmission tower

footings were installed there as part of earlier

plans but were never used.” NRC reports that

the proposed new Fermi 3 transmission line

corridor would cross open water, deciduous

forest, evergreen forest, mixed forest, grassland, 93.4 acres of woody wetlands, and 13

acres of emergent herbaceous wetland. (Table

2-7, Vegetative Cover Types in the Proposed

29.4 mi. Transmission Corridor, page 2-46).

This shows what is at stake – major impacts,

or perhaps even complete destruction, to irreplaceable habitat, vital for the viability of endangered and threatened species, as well as

overall ecosystem [11] health. . . . DEIS Table

4-2 repeats the sensitive vegetative cover

forms at risk from the proposed Fermi 3 transmission corridor: 170 acres of deciduous forest, 74 acres of woody wetlands, and 9 acres of

herbaceous emergent wetlands.34

Intervenors maintained that the DEIS failed to adequately assess the impacts to these areas. For example,

they criticized the DEIS for failing to provide any

Id.

Id. at 44-45.

App. 39

quantitative information about impacts to wetlands,

such as the acreage that will be filled and/or destroyed.35

Intervenors also stressed potential impacts to

threatened and endangered species:

NRC’s DEIS section 2.4.1.4 Important Terrestrial Species and Habitats – Transmission

Lines (page 2-60) also reports the high biological stakes. Important species may occur

along transmission lines, “but because the exact route of the corridor has not been finally

determined, no surveys have yet been conducted to confirm the presence of any species.”

. . . [T]able 2-9 (page 2-61) shows state-listed

and federally-listed species which inhabit the

counties (Monroe, Washtenaw, Wayne) that

would be crossed, including over 80 plant species, 8 insect species, 2 amphibian species, 4

reptile species (including the Eastern Fox

Snake), a dozen bird species, and 2 mammal

species. The Michigan Dept. of Natural Resources (MDNR/now DNRE) has not provided

concurrence for the project to proceed, because DTE has provided no details about the

transmission line corridor route for determining the damage that would be done to threatened and endangered species and their

habitats. MDNR has identified five Statelisted species likely present on the Fermi site,

which could also be present along the proposed Fermi 3 transmission corridor. In

Id. at 45.

App. 40

addition to all of the above, the U.S. Fish and

Wildlife Service has identified the eastern

massasauga snake as a candidate species potentially inhabiting Washtenaw and Wayne

Counties, and thus, at risk along the proposed

new transmission corridor.36

Intervenors argued that the DEIS failed to provide sufficient information concerning transmission corridor

impacts on threatened and endangered species.37

Intervenors further argued that maintenance of

the transmission corridor will continue to impact wetlands and other environmental resources after construction is completed. They noted that, according to

the DEIS, “ ‘[d]uring operation of Fermi 3, the power

transmission line [12] system would need to be maintained free of vegetation by ITC Transmission. Vegetation removal activities would include trimming and

application of herbicides periodically and on an asneeded basis along the transmission line corridor.”38

Intervenors complained of the failure to analyze the

environmental consequences of these actions:

It is clear that the deforestation will be an indefinitely long, or even permanent, condition.

Although herbicides designed for use in wetlands are mentioned, no specifics are given.

The impact of these biocides on species inhabiting the corridor is thus impossible to analyze, given the lack of specificity. The

Id. at 45-46.

Id. at 44-48.

Id. at 49 (quoting DEIS at 3-31).

App. 41

downgrade in the ecological quality and quantity (or even permanent loss and complete destruction) of forested wetlands in an extended

area along the Fermi 3 transmission line corridor is a major ecosystem impact, which currently goes unreflected.39

E. The Board’s Ruling on Proposed Contention 23

In its June 12, 2012 Order ruling on the DEIS contentions, the Board agreed with DTE and the Staff that

proposed Contention 23 was untimely because the deficiencies Intervenors alleged were also present in

DTE’s Environmental Report. Thus, Intervenors had

failed to establish that the contention was based on

any data or conclusions in the DEIS that are significantly different from those in the ER.40

The Board stated, however, that while Contention

23 was untimely, “it raises substantial questions concerning the adequacy of the DEIS that the NRC Staff

should carefully consider in preparing the FEIS.”41 Intervenors criticized the DEIS for, among other things,

an inadequately defined route for the corridor,42 a failure to identify endangered or threatened species along

the corridor,43 an inadequate discussion of impacts on

Id. at 48.

LBP-12-12, 75 NRC 742, 775-76 (2012).

Id. at 776.

Id. at 777-78.

Id. at 776-77.

App. 42

wetlands and vegetation,44 and a failure to [13] adequately investigate historic or cultural resources that

may be affected.45 The Board concluded that, “[g]iven

the very limited analysis in the DEIS of [the environmental impacts] arising from the transmission line

corridor, these claims may have been admissible had

they been filed in a timely manner.”46

The Board further observed that, even though the

transmission corridor is a preconstruction activity and

therefore not included in the COL application, construction and maintenance of the transmission corridor are sufficiently closely connected with Fermi Unit

3 that its environmental consequences must be fully

analyzed in the FEIS as direct impacts of the proposed

action.47 Because the Staff must comply with NEPA regardless of whether Intervenors filed a timely contention, the Board recommended that “the NRC Staff

consider the issues raised by Intervenors when it prepares the FEIS.”48

EPA comments on the DEIS

The Board was not alone in recommending that

transmission corridor impacts be fully evaluated in the

FEIS as direct impacts of the proposed action. Like the

Board, the United States Environmental Protection

Id. at 776-78.

Id. at 778.

Id.

Id. at 778-80.

Id. at 780.

App. 43

Agency (“EPA”), concluded that, even though the NRC

may regard preconstruction activities as outside the

scope of the COL application, “these activities are

within the scope of the NEPA review because they are

all connected actions, per 40 CFR 1508.25(a)(1)(iii).”49

Specifically addressing the DEIS’s failure to analyze

the construction of the [14] transmission lines and the

expansion of the substation as direct impacts of the

proposed action, EPA commented:

Transmission Lines and Substation

EPA understands that NRC analyzes impacts

from the lengthening of the transmission

lines and expansion of the Milan Substation

as cumulative impacts and outside the scope

of the COL permit application and accompanying NEPA document. However, per NEPA,

EPA views these actions as connected to the

granting of the license and, therefore, should

be analyzed as direct impacts as a result of

the proposed action. The Draft EIS even

acknowledges the connectedness of the building of Fermi 3 and the expansion of the Substation on page 3-17, lines 31-21, among other

locations: “The 350-ft-by-ft-500-ft Milan Substation may be expanded to an area about

1000 ft by 1000 ft to accommodate the Fermi

3 expansion (Detroit Edison 2011 b).” Therefore, because the lengthening of the

Letter from Kenneth Westlake, EPA, to Cindy Bladey,

NRC, Re: Draft Environmental Impact Statement for the Combined License (COL) for Enrico Fermi Unit 3, Monroe County,

Michigan, CEQ# 20110364, attach. 1, at 2 (Jan. 10, 2012) (ADAMS Accession No. ML12023A034).

App. 44

transmission lines and the expansion of the

Substation are only necessitated by granting

the COL license for Fermi 3, the Final EIS

should analyze impacts from these two actions as direct impacts.

Recommendation: The Final EIS should analyze the construction of the transmission

lines and the expansion of the Substation as

actions part of the proposed action; any unavoidable impacts should be accounted and

mitigated for.50

EPA also expressed concern

about the amount of habitat lost in the transmission corridor and due to the proposed expansion of the Substation, at 1,069 and 21

acres, respectively. As outlined under Transmission Corridor and Substation, EPA views

these developments as connected actions.

Therefore, estimated impacts should be considered when preparing mitigation plans.

This includes wetlands mitigation ratios.51

G. The Final Environmental Impact Statement

The FEIS for the Fermi Unit 3 COL was published

in January 2013.52 As it had done in the DEIS, the Staff

defined the construction of the transmission corridor

Id. at 14.

Id. at 7.

FEIS at i.

App. 45

as a “preconstruction activity.”53 Again relying upon

the 2007 LWA Rule, the Staff maintained that the NRC

lacks [15] regulatory authority over construction of the

transmission corridor because it is a preconstruction

activity.54 The Staff again stated that “[b]ecause the

preconstruction activities are not part of the NRC action, their impacts are not reviewed as a direct effect

of the NRC action. Rather, the impacts of the preconstruction activities are considered in the context of

cumulative impacts.”55 With respect to the environmental impacts raised by proposed Contention 23, the

analysis in the FEIS is much like that in the DEIS.

In its comments on the FEIS, the EPA reiterated

its earlier criticism, stating that “impacts resulting

from the construction and maintenance of the new

transmission lines and substations should be considered as direct impacts and mitigated for as part of the

proposed project. Total impacts are estimated to be

over 1000 acres of habitat, including over 93 acres of

impacts to forested wetlands.”56

Id. at 1-6.

Id. at 1-6 to 1-7.

Id. at 1-7.

Letter from Kenneth Westlake, EPA, to Cindy Bladey,

NRC, Re: Comments on the Final Environmental Impact Statement for the Combined License for Enrico Fermi Unit 3, Monroe

County, Michigan, CEQ No. 20130006, attach. 1, at 1 (Feb. 19,

2013) (ADAMS Accession No. ML13063A434) [hereinafter EPA

Comments on FEIS].

App. 46

H. The Board’s ruling on re-submitted Contention

On February 19, 2013, Intervenors re-submitted

proposed Contention 23, together with various other

new and re-submitted contentions filed in response to

the FEIS.57 Intervenors summarized their claim as follows:

The FEIS for a combined operating license for

Fermi 3 fails to satisfy the requirements of

NEPA because it does not address the environmental effects of the associated transmission line corridor extending nearly thirty (30)

miles from the proposed plant site, despite the

fact that the transmission lines are indispensable to completion of the power plant project,

and the NRC Staff was ordered to analyze the

transmission corridor within the FEIS by the

Atomic Safety and Licensing Board. The FEIS

fails to disclose what the U.S. Army Corps of

[16] Engineers has determined to be the least

environmentally damaging practical alternatives (LEDPAs) under the Clean Water Act,

for some 30 jurisdictional wetlands and other

water bodies within the transmission corridor,

and there is no detailed discussion of mitigation measures which would be implemented

Motion for Resubmission of Contentions 3 and 13, for Resubmission of Contention 23 or its Admission as a New Contention, and for Admission of the New Contentions 26 and 27 (Feb.

19, 2013).

App. 47

to compensate for the water resource and upland damage.58

The Board again rejected Contention 23 as untimely. But the Board also concluded that, because the

FEIS had been issued and the Board had ruled that

Contention 23 remains procedurally defective, this was

an appropriate point for Board consideration of

whether Contention 23 merits sua sponte review under

10 C.F.R. § 2.340(b).59 The Board allowed the parties to

file briefs on the issue. Intervenors supported sua

sponte review, while DTE and the Staff opposed it.60

II. BOARD DETERMINATION,

SUPPORTING ANALYSIS, AND REQUEST

FOR COMMISSION APPROVAL

The Board has determined that the following two

related issues arising from Contention 23 merit sua

sponte review, and requests Commission approval to

undertake such review:

(1) Whether the building of offsite transmission

lines intended solely to serve the new Fermi Unit 3

qualifies as a connected action under NEPA and, therefore, requires the Staff to consider its environmental

Id. at 22.

Denial Order at 21-24.

See Intervenors’ Memorandum in Support of Sua Sponte

ASLB Referral of Transmission Line Corridor NEPA Compliance

Issue, at 1 (May 30, 2013). See also Applicant Brief at 1; NRC

Staff Response to Board Order Concerning Proposed Sua Sponte

Review of Contention 23, at 2 (May 30, 2013) [hereinafter Staff

Response].

App. 48

impacts as a direct effect of the construction of Fermi

Unit 3.

(2) Whether the Staff ’s consideration of environmental impacts related to the transmission corridor,

performed as a cumulative impact review, satisfied

NEPA’s hard look requirement.

Below, we explain the reasons that support our determination. First, we discuss the regulatory standard

for sua sponte review. Second, we review the NEPA requirements most [17] relevant to the environmental

analysis of the transmission corridor. Next, we analyze

the two specific issues and explain why they raise serious legal and factual questions that merit further review by the Board. Finally, we explain why the issues

we have determined to be appropriate for sua sponte

review can be distinguished from those likely to arise

in the ordinary case. On the basis of this analysis, the

Board respectfully requests that the Commission approve its determination.

A. The Standard for Sua Sponte Review

Under 10 C.F.R. § 2.340(b), a licensing board may

request Commission approval to consider the merits of

a serious environmental issue even when, as with Contention 23, it was excluded from the proceeding for procedural reasons.61 This sua sponte regulation provides

that the presiding officer shall

See Cleveland Electric Illuminating Co. (Perry Nuclear

Power Plant, Units 1 & 2), LBP-82-79, 16 NRC 1116, 1119 (1982).

App. 49

make findings of fact and conclusions of law

on any matter not put into controversy by the

parties, but only to the extent that the presiding officer determines that a serious safety,

environmental, or common defense and security matter exists, and the Commission approves of an examination of and decision on

the matter upon its referral by the presiding

officer. . . .62

The regulation does not define what constitutes a serious environmental issue, leaving that determination to

the presiding officer subject to the Commission’s approval.

Section 2.340(b)’s predecessor, unlike the current

version, did not require Commission approval before a

presiding officer could exercise sua sponte authority. It

did, however, instruct presiding officers that their sua

sponte review authority should only be used “sparingly” and in “extraordinary circumstances.”63 These

terms were removed from the regulation in 1979.64 The

[18] Commission subsequently stated, in a 1998 policy

statement, that licensing boards should only use sua

10 C.F.R. § 2.340(b)(1).

10 C.F.R. § 2.760a (1979) (“Matters not put into controversy by the parties will be examined and decided by the presiding officer only in extraordinary circumstances where he

determines that a serious safety, environmental, or common defense and security matter exists. This authority is to be used sparingly.”)

See 44 Fed. Reg. 67088 (Nov. 23, 1979) (stating that the

“amended rules eliminate an apparent constraint on boards”).

App. 50

sponte review in extraordinary circumstances,65 but

the terms “sparingly” and “extraordinary circumstances” have never been reinserted into the regulations.66

In 2004, the Commission “codif[ied] appropriate

portions of the [1998] Policy Statement,” noting that

the statement was developed “as a foundation for possible rule changes.”67 The 2004 rule codified the requirement that licensing boards request approval from

the Commission prior to conducting sua sponte review

Policy on Conduct of Adjudicatory Proceedings, 63 Fed.

Reg. 41872, 41874 (Aug. 5, 1998) (stating that sua sponte “authority is to be exercised only in extraordinary circumstances”).

In 1984, the NRC published a series of proposals developed

by a Regulatory Reform Task Force that included reinsertion of

the word “sparingly” and a requirement that any proposed use of

sua sponte review be approved by a licensing board established to

screen such proposals, though “[t]he individual proposals [were]

not Commission proposals.” See 49 Fed. Reg. 14698, 14703 (Apr.

12, 1984) (“Section 2.760a is revised to revoke the 1979 relaxation

of the sua sponte rule for review of uncontested matters by adjudicatory boards. Experience under the relaxed standard has indicated that issues have been raised sua sponte which do not

warrant such consideration. . . . the sua sponte authority of presiding officers to raise new issues will be limited to extraordinary

circumstances and is to be used sparingly.”). This document did

not, as NRC Staff suggest, constitute a revocation of the 1979 rule

change. Staff Response at 6 n.19. Two years later, the Commission published a proposed rule that “identified five proposals

which merit continued consideration for possible inclusion in . . .

the Commission’s Rules of Practice,” none of which addressed sua

sponte review. 51 Fed. Reg. 24365, 24366 (July 3, 1986).

69 Fed. Reg. 2182, 2182, 2186 (Jan. 14, 2004) (emphasis

added).

App. 51

of a matter not put into controversy.68 Notably absent,

however, was any requirement that the presiding officer’s determination or the Commission’s approval be

limited to issues presenting “extraordinary circumstances.” Evidently the Commission concluded that

that particular aspect of the 1998 policy statement was

not “appropriate” for inclusion in the new rule.

The 2012 rule revision, which clarified that sua

sponte authority extends to Board review of combined

license applications, states only that review “is limited

to . . . serious matters not [19] put into controversy by

the parties that concern safety, common defense and

security, or the environment that the Commission has

approved for review upon the presiding officer’s referral of the matter.”69 Again, there is no requirement of

“extraordinary circumstances.”

Given the historical development of the sua sponte

provision and that Commission approval is now required prior to sua sponte consideration of an issue, the

Commission is not constrained to approve only those

issues that arise under “extraordinary circumstances.”

Still, a request to engage in sua sponte review should

not be undertaken lightly. And it has not been. Recent

years have seen sparing use of sua sponte review.70 In

2011, in what would have been the first such request

Id. at 2210.

77 Fed. Reg. 46562, 46584 (Aug. 3, 2012).

Shaw AREVA MOX Services (Mixed Oxide Fuel Fabrication Facility), LBP-11-9, 73 NRC 391, 422 (2011) (J. McDade, dissenting) (noting that “no Board has attempted to invoke sua

sponte review in the past 20 years”).

App. 52

in twenty years, all members of the Licensing Board in

Shaw AREVA MOX Services determined that extraordinary circumstances existed such that sua sponte review would have been warranted had the serious

safety issue raised been deemed untimely.71 Here also,

the issues we have determined to be appropriate for

sua sponte review are “extraordinary” in that they differ from those likely to arise in the ordinary case.72

NEPA Requirements

“The centerpiece of environmental regulation in

the United States, NEPA requires federal agencies to

pause before committing resources to a project and

consider the likely environmental impacts of the preferred course of action as well as reasonable alternatives.”73 When an agency proposes a major Federal

action significantly affecting the quality of the [20] human environment, NEPA requires the preparation of

an EIS concerning the proposed action.74 The requirement to prepare an EIS is a procedural mechanism

designed to assure that agencies give proper consideration to the environmental consequences of their

Id. at 412, 422.

See infra Section II(E).

N.M. ex rel. Richardson v. Bureau of Land Mgmt., 565 F.3d

683, 703 (10th Cir. 2009) (citing 42 U.S.C. § 4331(b) (congressional declaration of national environmental policy); Pub. Citizen,

541 U.S. at 756-57; Marsh v. Or. Natural Res. Council, 490 U.S.

360, 371 (1989); and Forest Guardians v. U.S. Forest Serv., 495

F.3d 1162, 1172 (10th Cir. 2007)).

42 U.S.C. § 4332.

App. 53

actions.75 However, NEPA does not require agencies to

elevate environmental concerns over other appropriate

considerations.76

The following NEPA requirements are particularly relevant here.

The Scope of an EIS

The “scope” of an EIS is defined as “the range of

actions, alternatives, and impacts to be considered in

an environmental impact statement.”77 The NRC regulation governing the scope of the EIS states that the

agency should use the provisions of a CEQ regulation,

40 C.F.R. § 1502.4, for that purpose.78 Section 1502.4 in

turn directs that

[a]gencies shall use the criteria for scope

(§ 1508.25) to determine which proposal(s)

shall be the subject of a particular statement.

Proposals or parts of proposals which are related to each other closely enough to be, in effect, a single course of action shall be

evaluated in a single impact statement.79

Under the referenced CEQ regulation, the proposed action that is the subject of the EIS must include all

See Vt. Yankee Nuclear Power v. Natural Res. Def. Council,

435 U.S. 519, 558 (1978).

Strycker’s Bay Neighborhood Council, Inc. v. Karlen, 444

U.S. 223, 227 (1980).

40 C.F.R. § 1508.25.

10 C.F.R. § 51.29(a)(1).

40 C.F.R. § 1502.4(a).

App. 54

“connected actions.”80 The definition of “connected

actions” in § 1508.25 is also adopted by 10 C.F.R.

§ 51.14(b). Under § 1508.25, separate actions are “connected” if, among other things, they “[c]annot or will

not proceed unless other actions are taken previously

or simultaneously,” or they “[a]re interdependent parts

of a larger action and depend on the larger [21] action

for their justification.”81 Thus, all connected actions as

defined in § 1508.25 must be included within the scope

of the proposed action evaluated in the NRC’s FEIS.

In general, NEPA case law defines “connected actions” as those that lack “independent utility.”82 The

Sixth Circuit applies that test.83 Projects lack independent utility when it would be irrational, or at least

unwise, to build one without the other.84 For example,

the Ninth Circuit held that the construction of a road

to facilitate logging and the sale of timber from the logging were “connected actions” that had to be addressed

in a single EIS.85 The court pointed out that “the timber

sales cannot proceed without the road, and the road

Id. § 1508.25(a)(1).

Id. § 1508.25(a)(1)(ii) and (iii). NRC’s NEPA regulations

specifically adopt this definition. See 10 C.F.R. § 51.14(b).

See Soc’y Hill Towers Owners’ Ass’n v. Rendell, 210 F.3d

168, 181 (3d Cir. 2000) (collecting cases); Nw. Res. Info. Ctr. v.

Nat’l Marine Fisheries Serv., 56 F.3d 1060, 1067-69 (9th Cir.

1995) (collecting cases).

Communities, Inc. v. Busey, 956 F.2d 619, 627 (6th Cir.

1992).

Trout Unlimited v. Morton, 509 F.2d 1276 (9th Cir. 1974).

Thomas v. Peterson, 753 F.2d 754, 758 (9th Cir. 1985).

App. 55

would not be built but for the contemplated timber

sales.”86

The failure to include all connected actions within

the scope of the proposed action is generally referred

to as “segmentation.” “ ‘Segmentation’ or ‘piecemealing’ occurs when an action is divided into component

parts, each involving action with less significant environmental effects.”87 “Segmentation is to be avoided in

order to ‘insure that interrelated projects[,] the overall

effect of which is environmentally significant, not be

fractionalized into smaller, less significant actions.’ ”88

[22]

2. The FEIS must evaluate all reasonably

foreseeable environmental impacts of the proposed action.

Once the NRC has properly defined the scope of

the proposed action, including any connected actions,

the agency’s EIS must evaluate the environmental

effects of the proposed action.89 The NRC uses this information to “[d]etermine, after weighing the environmental, economic, technical, and other benefits against

environmental and other costs . . . whether the combined license should be issued, denied, or appropriately

Id.

Town of Huntington v. Marsh, 859 F.2d 1134, 1142 (2d Cir.

1988) (citing City of W. Chi. v. NRC, 701 F.2d 632, 650 (7th Cir.

1983)).

Id. (quoting Taxpayers Watchdog, Inc. v. Stanley, 819 F.2d

294, 298 (D.C. Cir. 1987)).

10 C.F.R. §§ 51.71(d), 51.90; 40 C.F.R. § 1508.25(a)(1).

App. 56

conditioned to protect environmental values.”90 “The

EIS must address all reasonably foreseeable environmental impacts . . . even if the probability of such an

occurrence is low.”91 NEPA requirements, however, are

subject to a rule of reason, and an EIS need not address

“remote and highly speculative consequences.”92

In 10 C.F.R. § 51.14(b), the NRC adopted the

CEQ’s definition of “effects” in 40 C.F.R. § 1508.8. Under the CEQ rule, effects include both direct effects,

“which are caused by the action and occur at the same

time and place,” and indirect effects, “which are caused

by the action and are later in time or farther removed

in distance, but are still reasonably foreseeable.” The

CEQ regulation further provides:

Effects and impacts as used in these regulations are synonymous. Effects includes ecological (such as the effects on natural resources

and on the components, structures, and functioning of affected ecosystems), aesthetic, historic, cultural, economic, social, or health,

whether direct, indirect, or cumulative.93

When information relevant to a reasonably foreseeable environmental effect is [23] incomplete or unavailable, CEQ regulations require an agency to obtain

10 C.F.R. § 51.107(a)(3).

Blue Ridge Envtl. Def. League v. NRC, 716 F.3d 183, 188

(D.C. Cir. 2013) (citing 40 C.F.R. § 1502.22(b)).

Deukmejian v. NRC, 751 F.2d 1287, 1300 (D.C. Cir. 1984)

(quoting Trout Unlimited, 509 F.2d at 1283). See also Blue Ridge

Envtl. Def. League, 716 F.3d at 189.

40 C.F.R. § 1508.8.

App. 57

the unavailable information and include it in the EIS

so long as the costs are not exorbitant.94 If the cost of

obtaining the information is exorbitant, the agency

must still include in the EIS a statement that the information is unavailable, the relevance of the unavailable information, a summary of existing credible

scientific evidence, and the agency’s evaluation of the

impacts that might be caused.95

The FEIS must evaluate alternatives to the

proposed action, including mitigation.

An EIS must include a detailed statement of reasonable alternatives to the proposed action.96 When

considering alternatives, agencies are to:

(a) Rigorously explore and objectively evaluate all reasonable alternatives, and for alternatives which were eliminated from detailed

study, briefly discuss the reasons for their

having been eliminated.

(b) Devote substantial treatment to each alternative considered in detail including the

proposed action so that reviewers may evaluate their comparative merits. . . .97

The CEQ regulation itself and numerous courts have

recognized that the alternatives analysis is the “heart

See id. § 1502.22(a).

See id. § 1502.22(b).

42 U.S.C. § 4332(2)(C)(iii). See also La. Energy Servs., L.P.

(Claiborne Enrichment Ctr.), CLI-98-3, 47 NRC 77, 104 (1998).

40 C.F.R. § 1502.14.

App. 58

of the environmental impact statement.”98 “The existence of reasonable but unexamined alternatives renders an EIS inadequate.”99

The NRC’s NEPA regulation governing preparation of a DEIS directs that it “include a preliminary

analysis that considers and weighs the environmental

effects of the proposed action; [24] the environmental

impacts of alternatives to the proposed action; and alternatives available for reducing or avoiding adverse

environmental effects. . . .”100 The NRC’s regulation

governing preparation of an FEIS imposes the same

requirement by directing that the NRC Staff “prepare

a final environmental impact statement in accordance

with the requirements of . . . [10 C.F.R. § 51.71] for a

draft environmental impact statement.”101

Cumulative Impacts

Activities excluded from the scope of the proposed

action may still be relevant to the NRC’s NEPA analysis to the extent they affect the environmental baseline

for the evaluation of cumulative impacts. Under CEQ

regulations, “cumulative impact” is defined as the “impact on the environment that results from the

Id. See also Alaska v. Andrus, 580 F.2d 465, 474 (D.C.

Cir.), vacated in part as moot sub nom. W. Oil & Gas Ass’n v.

Alaska, 439 U.S. 922 (1978).

Friends of Se.’s Future v. Morrison, 153 F.3d 1059, 1065

(9th Cir. 1998).

100

10 C.F.R. § 51.71(d) (emphasis added).

101

Id. § 51.90.

App. 59

incremental impact of the [proposed] action when

added to other past, present, and reasonably foreseeable future actions regardless of what agency (Federal

or non-Federal) or person undertakes such other actions.”102

In the FEIS, the Staff treated the construction of

the transmission corridor as a separate non-federal action rather than a connected action. The Staff therefore

evaluated the transmission corridor solely as a reasonably foreseeable future action that forms part of the

environmental baseline for evaluating the cumulative

impact of the proposed action, i.e., the licensing of the

construction and operation of Fermi Unit 3.

Limitation on actions

An important consequence of the decision whether

to include new construction within the scope of the proposed action is that, if it is included, it will be subject

to the limitation on actions in 10 C.F.R. § 51.101(a).

Under that provision, when the Staff prepares an EIS

under 10 C.F.R. § 51.20, then until a record of decision

is issued “[n]o action concerning the proposal [25] may

be taken by the Commission which would (i) have an

adverse environmental impact, or (ii) limit the choice

of reasonable alternatives.”103 Also, “[a]ny action concerning the proposal taken by an applicant which

would (i) have an adverse environmental impact, or (ii)

limit the choice of reasonable alternatives may be

102

103

40 C.F.R. § 1508.7.

10 C.F.R. § 51.101(a)(1).

App. 60

grounds for denial of the license.”104 For separate activities, on the other hand, there is no obligation on the

Commission to avoid regulatory action before the record of decision is issued that would allow the activity

to proceed, regardless of its environmental impact or

its effect on the range of alternatives. And the applicant may proceed with (or allow its contractor to proceed with) an activity outside the scope of the proposal

that would have an adverse environmental impact or

limit the choice of reasonable alternatives even though

the NEPA review is ongoing or has not even begun.

This was precisely the point that the NRC Staff commenter made about the proposed 2007 LWA Rule.105

There is a serious question whether the building

of an offsite transmission corridor intended

solely to serve the new Fermi Unit 3 qualifies as

a connected action under NEPA and, therefore,

requires the Staff to consider its environmental

impacts as a direct effect of the construction of

Fermi Unit 3.

Given that the transmission corridor’s sole apparent purpose is to serve the Fermi Unit 3 project and

the new nuclear power plant would be useless without

the new transmission lines, Intervenors (and the EPA)

have raised a serious question whether the construction of the new transmission corridor should have been

analyzed as a connected action in the FEIS.

104

105

Id. § 51.101(a)(2).

72 Fed. Reg. at 57420.

App. 61

In order for construction of the transmission corridor to constitute a connected action under 40 C.F.R.

§ 1508.25, three requirements must be met. First, the

transmission corridor must be a proposed action rather

than one that is merely conceivable.106 Second, the

transmission corridor must lack independent utility,

that is, its sole purpose must be serving [26] Fermi

Unit 3.107 Third, for an action such as the transmission

corridor that will not be constructed by or expressly

permitted by the federal agency preparing the EIS,

there must be sufficient federal control and responsibility that the action qualifies as a federal action.108 We

review each of these issues in turn.

Proposed Action

The FEIS states that “ITC Transmission has not

yet formally announced a route for the offsite portion

of the proposed new transmission line serving Fermi

3,” but it also states that “Detroit Edison expects that

the proposed new transmission line would be built”

along the corridor identified in the FEIS.109 The FEIS

106

See Kleppe v. Sierra Club, 427 U.S. 390, 410 & n.20

(1976).

107

See Thomas, 753 F.2d at 759-60 (citing Trout Unlimited,

509 F.2d at 1276 (stating that an EIS must address interdependent projects when “[t]he dependency is such that it would be irrational, or at least unwise, to undertake the first phase if

subsequent phases were not also undertaken.”)).

108

See Sw. Williamson Cnty. Cmty. Ass’n, Inc. v. Slater, 243

F.3d 270, 278-80 (6th Cir. 2001).

109

FEIS at 2-10.

App. 62

repeatedly refers to the “proposed” transmission corridor.110 For example, the FEIS includes a map identifying the “Proposed Transmission Corridor from Fermi 3

to the Milan Substation.”111 The FEIS reports that

“[t]hree new 345-kV transmission lines have been proposed to serve Fermi 3.”112 The FEIS also refers to “the

proposed route from the Fermi 3 site in Monroe County

to the existing Milan Substation in Washtenaw

County.”113 Furthermore, in response to written questions propounded by the Board, DTE informed the

Board that it is unaware of any other transmission corridor route [27] currently under consideration.114 An

action with potential impacts subsequent to the initial

federal action may not constitute a proposed action if

it is insufficiently certain.115 Here, by contrast, there is

no doubt that offsite transmission lines would be built

to serve Fermi 3 and no suggestion of any plan to build

them anywhere but along the proposed route identified

in the FEIS. Therefore, based on the information now

110

See, e.g., id. at 2-61, 2-126, and 3-18 to 3-19. The fact that

the Staff declares the transmission lines to be a proposed action

is significant, as under CEQ regulations “[a] proposal may exist

in fact as well as by agency declaration that one exists.” 40 C.F.R.

§ 1508.23.

111

FEIS at 2-11 (emphasis added).

112

Id. at 4-8 (emphasis added).

113

Id. at 2-208 (emphasis added).

114

Applicant Brief at 8; Smith Affidavit at 5.

115

See Webster v. U.S. Dep’t of Ag., 2011 WL 8788223, at *8

(N.D.W. Va. June 13, 2011) (finding that the building of a water

treatment plant to serve a proposed dam was not sufficiently certain and any attempt to determine environment impacts would

be “speculative and contingent”).

App. 63

before the Board, it appears that the transmission corridor identified in the FEIS is a proposed action.116

Independent Utility

The FEIS clearly shows that the purpose of the

new transmission corridor is to serve Fermi Unit 3 (i.e.,

to transmit electrical energy from Fermi Unit 3 to the

grid).117 No party has identified any other function that

the corridor is intended to serve. Just as the construction of a road to facilitate logging and the sale of timber

that would result from that logging were connected actions,118 so too the construction of a new nuclear power

plant and the transmission corridor that will transmit

the newly generated power to the grid are also connected actions.

116

Whether a project qualifies as a “proposal” is somewhat

intertwined with the “independent utility” question. CEQ’s regulations state that a “[p]roposal exists at that stage in the development of an action when an agency subject to the Act has a goal

and is actively preparing to make a decision on one or more alternative means of accomplishing that goal and the effects can be

meaningfully evaluated. Preparation of an environmental impact

statement on a proposal should be timed so that the final statement may be completed in time for the statement to be included

in any recommendation or report on the proposal.” 40 C.F.R.

§ 1508.23. In a situation such as this, where the granting of a license makes the building of offsite transmission lines inevitable,

an evaluation of their direct environmental impacts will only be

meaningful if engaged in before the license issuance.

117

FEIS at 2-10 to 2-11, 3-17 to 3-19.

118

Thomas, 753 F.2d at 758.

App. 64

DTE stated in response to a question from the

Board that the new transmission lines [28] might possibly serve some as yet unidentified source of electrical

energy if Fermi 3 is not constructed.119 Absent additional evidence, this theoretical possibility is too speculative to establish that the transmission corridor

actually has independent utility. Our view is supported

by the Appeal Board’s ruling in Greenwood upholding

the NRC’s authority to impose environmental restrictions on new transmission lines intended to serve

two new Detroit Edison nuclear power plants.120 The

Licensing Board had described the new transmission

lines “as an integral part of nuclear generating plants,

observing that ‘[a] power plant without transmission

lines is like an airplane that can’t fly.’ ”121 The Appeal

Board agreed. As in this case, in Greenwood, DTE

“could not represent that identical power lines along

identical routes would be erected irrespective of the

Greenwood nuclear facility.”122 The Appeal Board

therefore had

no hesitation in concurring in the Licensing

Board’s assumption that the lines are a foreseeable consequence of licensing construction

of the nuclear power units. Indeed, no other

conclusion is reasonable. Without transmission lines the Greenwood facility would be little more than a very expensive double boiler

119

Applicant Brief at 8; Smith Affidavit at 5-6.

Greenwood Energy Ctr., ALAB-247, 8 AEC at 936.

121

Id. at 937.

122

Id. at 939.

120

App. 65

serving no discernible purpose. It is scarcely

likely that Detroit Edison would embark upon

such an enterprise even if given the green

light by the regulatory bodies which oversee

its operations.123

Here also, the proposed transmission corridor is an integral part of the Fermi 3 project with “no discernible

purpose” apart from connecting Fermi 3 to the grid.

Federal Control and Responsibility

The FEIS does not refer to any purpose of the new

transmission corridor other than serving Fermi 3. But

the Staff did not analyze the transmission corridor as

a connected action. Instead, it defined the construction

of the transmission corridor as a “preconstruction activity,” [29] and excluded it from the scope of the proposed action because of the 2007 LWA Rule narrowing

the definition of “construction” and disclaiming NRC

regulatory authority over all preconstruction activities.124 Thus, the Staff evaluated the impacts of the

transmission corridor solely “in the context of cumulative impacts.”125 In substance, the Staff concluded that

the scope of the proposed federal action should include

only the power plant and not the transmission corridor

necessary to make the plant serve its intended purpose

because, in the Staff ’s view, the transmission corridor

is outside the scope of the federal action.

123

Id.

FEIS at 1-6 to 1-7.

125

Id. at 1-7.

124

App. 66

The requirement to prepare an EIS applies to “major Federal actions,” not to private or state actions.126

Thus, only those activities that have sufficient federal

involvement to qualify as federal actions need be included in the scope of the proposed action evaluated in

an EIS.127 But this does not necessarily mean that the

action in question must be taken or expressly authorized by a federal agency. In Southwest Williamson

County Community Ass’n, Inc. v. Slater, the court defined the test for determining when a non-federal project should be analyzed under NEPA as a major federal

action:

With the CEQ regulations and case law in

mind, we conclude that there are two alternative bases for finding that a non-federal project constitutes a “major Federal action” such

that NEPA requirements apply: (1) when the

non-federal project restricts or limits the statutorily prescribed federal decision-makers’

choice of reasonable alternatives; or (2) when

the federal decision-makers have authority to

exercise sufficient control or responsibility

over the non-federal project so as to influence

the outcome of the project. If either test is

satisfied, the non-federal project must be

126

42 U.S.C. § 4332(2)(C).

See Sw. Williamson Cnty., 243 F.3d at 278-80. But see

Colo. Wild, Inc. v. U.S. Forest Serv., 523 F.Supp.2d 1213, 1224-25

(D. Colo. 2007) (rejecting the U.S. Forest Service’s claim that road

construction and development planned by a private party seeking

access rights-of-way over national forest land “cannot be ‘connected actions’ under NEPA’s regulations because the Forest Service lacks authority to control them”).

127

App. 67

considered a major federal action. Both tests

require a situation-specific and fact-intensive

analysis.128

[30] We understand that construction of the transmission corridor has not begun. Therefore, the first test

is not satisfied. This is not an instance where, at least

thus far, “the non-federal project restricts or limits the

statutorily prescribed federal decision-makers’ choice

of reasonable alternatives.”129 On the other hand, in

this case “the federal decision-makers have authority

to exercise sufficient control or responsibility over the

non-federal project so as to influence the outcome of

the project.”130 In Southwest Williamson County, the

court held that the second test was not satisfied because the authority of the Federal Highway Administration (“FHWA”) was limited to certain

interchanges between a federally financed highway

project and a state highway. “No part of the statute

confers jurisdiction on the FHWA . . . to oversee the

construction of the highway corridor that runs between the interchanges unless the state attempts to

comply with federal regulations in order to seek federal reimbursement for construction costs.”131

Here, by contrast, the NRC long interpreted its

statutory authority under the Atomic Energy Act

128

Sw. Williamson Cnty., 243 F.3d at 281 (footnote omitted).

Id. at 281-83.

130

Id. at 283-84.

131

Id. at 283.

129

App. 68

(“AEA”)132 to include conditioning approval of nuclear

power plant licenses on environmentally acceptable

routing of transmission lines.133 The United States

Court of Appeals for the First Circuit upheld the NRC’s

authority to regulate offsite transmission lines under

the AEA, affirming a licensing board decision conditioning approval of permits to the Seabrook Nuclear

Power Station on the rerouting of two offsite transmission lines to avoid environmental [31] impacts on

marshlands, tree species, and migratory waterfowl.134

Two years later, the Sixth Circuit also upheld the Commission’s authority, unequivocally holding that “1) the

regulation of off-site transmission lines is within the

Commission’s authority under Section 101 of the

Atomic Energy Act; and 2) that nothing in the Atomic

Energy Act precludes the Commission from implementing, through the issuance of conditional licenses,

NEPA’s environmental mandate.”135

The holdings of the First and Sixth Circuits continue to be the law in those jurisdictions. Under those

rulings, the NRC may consistently with the AEA and

NEPA impose environmental restrictions on transmission lines built to serve nuclear power plants should it

choose to do so. The NRC’s regulations, including 10

C.F.R. §§ 50.36(b) and 51.107(a)(3), authorize the

agency to impose environmental conditions in a license

132

Atomic Energy Act of 1954, 42 U.S.C. § 2011 et seq. (2012).

Pub. Serv. Co. of N.H. v. NRC, 582 F.2d 77, 82 (1st Cir.

1978). See discussion supra Section I(C).

134

Pub. Serv. Co. of N.H., 582 F.2d at 80.

135

Detroit Edison, 630 F.2d at 452.

133

App. 69

to prevent or mitigate adverse environmental impacts

that might otherwise be caused by the construction or

operation of a nuclear power plant.136 “Environmental

protection is a central part of NRC’s core mission and

is in its mission statement.”137 Thus, under Sixth Circuit precedent, “the federal decision-makers have authority to exercise sufficient control or responsibility

over the non-federal project so as to influence the outcome of the project.”138

To be sure, in the 2007 LWA Rule the NRC decided

that the building of transmission lines to serve a nuclear power plant would no longer be classified as a

construction activity and would no longer require authorization from the NRC.139 Intervenors have not

challenged the Rule and we would be precluded from

hearing such a challenge had they done so, absent a

[32] showing of special circumstances.140 But an

agency’s narrowed construction of its statutory authority, as distinct from an express prohibition by Congress, may not be used to limit the agency’s obligations

under NEPA.141 “NEPA’s legislative history reflects

136

Progress Energy Fla., Inc. (Levy Cnty. Nuclear Plant,

Units 1 & 2), LBP-13-4, 77 NRC 107, 217 (2013).

137

Id.

138

Sw. Williamson Cnty., 243 F.3d at 281.

139

10 C.F.R. § 50.10(a)(2)(vii).

140

10 C.F.R. § 2.335.

141

Ctr. for Biological Diversity v. Nat’l Highway Traffic

Safety Admin., 538 F.3d 1172, 1213 (9th Cir. 2008); Sierra Club

v. Mainella, 459 F. Supp. 2d 76, 105 (D.D.C. 2006) (distinguishing

agency NEPA responsibilities in situations where “an agency has

‘no ability’ because of lack of ‘statutory authority’ to address the

App. 70

Congress’s concern that agencies might attempt to

avoid any compliance with NEPA by narrowly construing other statutory directives to create a conflict with

NEPA. Section 102(2) of NEPA therefore requires government agencies to comply ‘to the fullest extent possible.’ ”142 The Supreme Court has explained that this

statutory directive was “neither accidental nor hyperbolic.”143 Thus, courts have held that NEPA obligations

supplement existing statutory authority and “must be

complied with to the fullest extent, unless there is a

clear conflict of statutory authority.”144 In short, absent

clear conflict an agency cannot interpret its way out of

its NEPA responsibilities.

Also, although the NRC now takes the position

that it lacks authority to impose environmental restrictions on transmission corridors, Border Power

Plant Working Group supports the view that the transmission corridor impacts should have been analyzed as

a direct effect of the NRC action even under that new

impact” with situations where an agency “is only constrained by

its own regulation from considering impacts”).

142

Ctr. for Biological Diversity, 538 F.3d at 1213 (quoting

Forelaws on Bd. v. Johnson, 743 F.2d 677, 683 (9th Cir.1985)).

See also Flint Ridge Dev. Co. v. Scenic Rivers Ass’n of Okla., 426

U.S. 776, 787 (1976) (quoting House and Senate Conferees, who

inserted the “fullest extent possible” language into NEPA, to say

that “no agency shall utilize an excessively narrow construction

of its existing statutory authorizations to avoid compliance”).

143

Flint Ridge Dev. Co., 426 U.S. at 787.

144

Calvert Cliffs, 449 F.2d at 1115.

App. 71

interpretation.145 In that case, an environmental group

challenged two federal agencies’ issuance of permits

and rights-of-way allowing two [33] utilities to build

electricity transmission lines to connect new power

plants in Mexico with the power grid in southern California. The Mexican plants were outside the jurisdiction of the federal agencies. Nevertheless, the district

court held that increased air pollution in California resulting from two “export turbines” at one of the Mexican plants was a direct effect of the new transmission

lines, and that DOE therefore had to evaluate the air

pollution impacts under NEPA.146 The same analysis

applies here. Although the NRC has renounced regulatory jurisdiction over the transmission lines, the construction of the lines and the resulting environmental

impacts will be a direct effect of the COL, should it be

issued, and must be analyzed as such under NEPA.

Both the Staff and Applicant emphasize that the

offsite transmission lines will be owned and operated

by ITC Transmission and not by DTE.147 For this reason, Applicant notes, “Staff relied on publicly available

information and reasonable expectations of the configurations that ITC Transmission would likely use for

the offsite corridor based on standard industry practice.”148 But the significance placed on this fact by Staff

and Applicant appears misplaced. Multiple projects

145

See Border Power Plant Working Grp. v. U.S. Dep’t of Energy, 260 F. Supp. 2d 997, 1012-18 (S.D. Cal. 2003).

146

Id.

147

Staff Response at 10; Applicant Brief at 5.

148

Applicant Brief at 5.

App. 72

are often deemed connected actions despite being undertaken by separate entities.149 In fact, projects undertaken by separate entities may still be considered

connected actions even in the absence of formal agreement between the parties.150 After all, “NEPA [34]

mandates a case-by-case balancing judgment on the

part of federal agencies,” not the private parties seeking federal action.151 If it is established that ITC Transmission’s proposed new transmission corridor lacks

independent utility, the Staff should have included it

within the scope of the proposed action, analyzed its

impacts as direct effects of the NRC action, and evaluated alternatives available for reducing or avoiding

any adverse environmental effects.152

149

See, e.g., Hammond v. Norton, 370 F. Supp. 2d 226, 24753 (D.D.C. 2005) (ruling that the Bureau of Land Management

improperly segmented consideration of two pipeline projects being constructed by two separate companies despite evidence that

they lacked independent utility and thus qualified as connected

actions); Natural Res. Def. Council v. Hodel, 865 F.2d 288 (D.C.

Cir. 1988) (rejecting as inadequate an FEIS that failed to consider

the cumulative impacts on migratory species caused by multiple

outer-continental lease sales in the California and Alaska regions).

150

See Hammond, 370 F. Supp. 2d at 245, 251 (making clear

that a determination that actions are connected does not rest

upon formal agreement between the entities undertaking the actions, and noting EPA’s argument that “CEQ does not require a

formal agreement in order for two projects to be defined as connected actions”).

151

Calvert Cliffs, 449 F.2d at 1123.

152

We note, additionally, that nothing in the FEIS suggests

that the NRC Staff gave much, if any, consideration to EPA’s suggestion that offsite transmission lines should have been

App. 73

The 2007 LWA Rule and Statement of Considerations

According to DTE, “the Commission has specifically directed, by regulation, that the impacts of ‘preconstruction’ activities be addressed cumulatively

with the impacts authorized by a combined license,”

and that “[t]his is precisely the approach taken by the

NRC Staff.”153 That argument would have merit only if

the provision cited by DTE, 10 C.F.R. § 51.45(c), repealed, materially altered, or directed the Staff to ignore the NRC and CEQ regulations previously

described which require that the proposed action that

is the subject of an agency EIS include all “connected

actions” as defined in 40 C.F.R. § 1508.25.154 Section

51.45(c) contains no language to that effect. Concerning preconstruction activities, it merely provides that

considered as a connected action. See FEIS, app. E, at E-42 to E43. While NEPA does not require “an agency preparing an EIS to

respond to EPA concerns, [an agency’s] failure even to address

them in the EIS at the very least brings into question the sufficiency of the agency’s analysis.” Hammond, 370 F. Supp. 2d at

251 (citing Citizens Against Burlington v. Busey, 938 F.2d 190,

201 (D.C. Cir. 1991) (stating that an agency “does not have to follow the EPA’s comments slavishly – it just has to take them seriously.”); Natural Res. Def. Council v. Hodel, 865 F.2d at 297-99

(stating that the court considered the failure to meaningfully address EPA concerns in its decision that FEIS did not comply with

NEPA); and Alaska v. Andrus, 580 F.2d at 475 (stating that EPA’s

determination that the EIS was unsatisfactory “did give rise to a

heightened obligation on [the lead agency’s] part to explain

clearly and in detail its reasons for proceeding”)).

153

Applicant Brief at 12.

154

See supra Section II(B)(1).

App. 74

[35] [a]n environmental report prepared at the

. . . combined license stage under § 51.50(c)

must include a description of impacts of the

preconstruction activities performed by the

applicant at the proposed site (i.e., those activities listed in paragraph (1)(ii) in the definition of ‘construction’’ contained in § 51.4),

necessary to support the construction and operation of the facility which is the subject of

the . . . combined license application. The environmental report must also contain an analysis of the cumulative impacts of the activities

to be authorized by the . . . combined license

in light of the preconstruction impacts described in the environmental report.155

This direction concerns the content of the ER, a document prepared by the applicant. The definition of the

scope of the EIS, however, is the responsibility of the

NRC Staff.156 For the purpose of defining the scope of

the proposed action that is to be the subject of an EIS,

the Staff is instructed to use 40 C.F.R. § 1502.4, which

directs that “[p]roposals or parts of proposals which

are related to each other closely enough to be, in effect,

a single course of action shall be evaluated in a single

impact statement.”157 Section 51.45(c) does not alter

that obligation or the obligation to include within the

155

10 C.F.R. § 51.45(c).

Id. §§ 51.28, 51.29.

157

40 C.F.R. § 1502.4. Under 10 C.F.R. § 51.29(a)(1), the

Staff is directed to use that provision to determine the scope of

the proposed action that is the subject of an agency EIS.

156

App. 75

scope of the proposed action all connected actions as

defined in § 1508.25.

DTE also relies on the Statement of Considerations for the 2007 LWA Rule (the “SOC”).158 Courts regularly rely upon the preamble in interpreting an

agency rule.159 Similarly, the Commission often refers

to the Statement of Considerations as an aid in interpreting the agency’s regulations.160 But the preamble,

unlike the rule itself, does not have the force of law [36]

and may not be used to expand the reach of the regulations.161 Thus, the SOC, while it may be used to interpret any ambiguous text of the 2007 LWA Rule, cannot

add new requirements or prohibitions. As we have explained, § 51.45(c) contains no language modifying the

Staff ’s obligation under NRC and CEQ regulations to

include connected actions in the scope of the proposed

action, and the SOC cannot interpret what the regulation itself does not contain.

158

See Applicant Brief at 11-12.

See Nat’l Mining Ass’n v. EPA, 59 F.3d 1351, 1355 n.7

(D.C. Cir. 1995).

160

Pa’ina Haw., LLC (Materials License Application), CLI08-3, 67 NRC 151, 163 n.46 (2008) (quoting Duke Energy Corp.

(Catawba Nuclear Station, Units 1 & 2), CLI-04-11, 59 NRC 203,

208 n.12 (2004)).

161

See A & E Coal Co. v. Adams, 694 F.3d 798, 802 (6th Cir.

2012) (explaining that the preamble “merely explains why the

regulations were amended” and did “not expand their reach”). See

also Curators of the University of Missouri (TRUMP-S Project),

CLI-95-1, 41 NRC 71, 98 (1995) (stating that NRC guidance cannot prescribe requirements).

159

App. 76

The SOC also does not invalidate the reasoning

underlying the decisions of the First and Sixth Circuits

that upheld the NRC’s authority to impose environmentally protective restrictions on transmission lines.

The SOC discusses the Commission’s reasons for

changing its interpretation of its statutory authority,

but it did not address those rulings of the courts of appeal. The Commission acknowledged that its previous

broad assertion of regulatory jurisdiction over activities now classified as “preconstruction” was “a reasonable implementation of NEPA as understood in

1972. . . .”162 The SOC also stated that the NRC’s broad

definition of “construction” in the pre-2007 version of

the 10 C.F.R. § 50.10(c) was originally added to Part 50

“due to the interpretation that the enactment of NEPA

required the NRC to expand its permitting/licensing

authority.”163 But the Commission stated that “subsequent judicial decisions have made it clear that NEPA

is a procedural statute and does not expand the jurisdiction delegated to an agency by its organic statute.”164

Although the NRC concluded it had overestimated

NEPA’s legal effect, the federal courts of appeal decisions upholding the NRC’s authority to impose environmental restrictions on transmission lines were not

premised on the theory that NEPA had expanded the

jurisdiction [37] delegated to the NRC by its organic

162

72 Fed. Reg. at 57420.

Id. at 57427.

164

Id.

163

App. 77

statute (the AEA). In Detroit Edison, the Sixth Circuit

upheld the Commission’s authority to regulate transmission lines in order to prevent environmental damage, making clear that this authority was founded

upon the AEA:

The Commission is empowered by [the AEA]

to regulate off-site transmission lines; in the

exercise of that power it must pursue the objectives of the Atomic Energy Act and NEPA

simultaneously. Under the Atomic Energy

Act, the Commission can issue conditional licenses for regulatory purposes. There can be

no objection to its use of the same means to

achieve environmental ends as well.165

In its brief in Detroit Edison, the NRC argued that

NEPA requires consideration of all significant environmental impacts of a proposed action, including off-site

transmission lines that are solely attributable to a proposed nuclear power plant.166 The NRC also argued

that the Commission is required “to administer the

Atomic Energy Act in accordance with the ‘national

policy of environmental protection’ ” and, therefore,

“must have the authority to use its license conditioning

power when necessary to protect the environment.”167

Additionally, the NRC asserted that the AEA and

NEPA provide independent sources of authority to

165

Detroit Edison, 630 F.2d at 454.

Brief for Respondents at 10, Detroit Edison, 630 F.2d 450

(No. 78-3196). The Brief was also filed on behalf of the United

States, represented by the Department of Justice.

167

Id. at 19.

166

App. 78

condition licenses based upon the environmental impacts related to off-site transmission lines. But the

court of appeals, in ruling that the NRC had appropriately interpreted the AEA to include regulatory authority over attendant transmission lines, made clear

that “[w]e need not, and do not, decide whether NEPA

is an independent source of substantive jurisdiction.”168 Thus, the court did not base its holding on the

theory that NEPA had expanded the NRC’s jurisdiction beyond that already provided in the AEA.

[38] Similarly, the First Circuit did not assume

that NEPA had expanded the NRC’s jurisdiction. Rather, the court of appeals understood that NEPA required the NRC to construe its existing statutory

authority consistently with NEPA’s goals:

NEPA’s mandate has been given strict enforcement in the courts, with frequent admonitions that it is insufficient to give mere lip

service to the statute and then proceed in

blissful disregard of its requirements. Section

102(2)(C) is an “action forcing” provision,

which imposes a duty upon federal agencies

to act so as to effectuate the purposes of the

statute to the fullest possible degree. The directive to agencies to minimize all unnecessary adverse environmental impact obtains

except when specifically excluded by statute or

when existing law makes compliance with

NEPA impossible. As stated by the court in

Calvert Cliffs, “Unless (specific statutory)

168

Detroit Edison, 630 F.2d at 452.

App. 79

obligations are plainly mutually exclusive

with the requirements of NEPA, the specific

mandate of NEPA must remain in force.” Unless there are specific statutory provisions

which necessarily collide with NEPA, the

Commission was under a duty to consider

and, to the extent within its authority, minimize environmental damage resulting from

Seabrook and its transmission lines.169

The First Circuit found no “inevitable clash” between the NRC’s broad regulatory authority under the

AEA and the action-forcing provisions of NEPA.

Both the Atomic Energy Act of 1954 and the

Energy Reorganization Act of 1974 confer

broad regulatory functions on the Commission and specifically authorize it to promulgate rules and regulations it deems necessary

to fulfill its responsibilities under the Acts. In

a regulatory scheme where substantial discretion is lodged with the administrative agency

charged with its effectuation, it is to be expected that the agency will fill in the interstices left vacant by Congress. The Atomic

Energy Act of 1954 is hallmarked by the

amount of discretion granted the Commission

in working to achieve the statute’s ends. The

Act’s regulatory scheme “is virtually unique

in the degree to which broad responsibility is

reposed in the administering agency, free of

close prescription in its charter as to how it

169

Pub. Serv. Co. of N.H., 582 F.2d at 81 (emphasis added)

(footnotes and citations omitted) (quoting Calvert Cliffs, 449 F.2d

1109, 1125 (D.C. Cir. 1971)).

App. 80

shall proceed in achieving the statutory objective.” The agency’s interpretation of what is

properly within its jurisdictional scope is entitled to great deference, and will not be overturned if reasonably related to the language

and purposes of the statute.170

Based on this understanding, the First Circuit upheld the agency’s decision to include transmission

lines that serve a nuclear power plant within the definition of “utilization facility” in [39] 42 U.S.C.

§ 2014(cc).171 It further held that the NRC could, consistent with its authority under the AEA, impose permit conditions on the routing of the transmission lines

in order to further NEPA’s mandate.172 Thus, the First

Circuit’s ruling, like that of the Sixth Circuit, was not

premised on the theory that NEPA had expanded the

jurisdiction delegated to the NRC in the AEA.

The SOC states that “the elimination of the blanket inclusion of site preparation activities [including

transmission lines] in the definition of construction . . .

170

Id. at 82 (citations omitted) (quoting Siegel v. Atomic Energy Comm’n, 400 F.2d 778, 783 (D.C. Cir. 1968)).

171

See id. at 82-83.

172

Id. at 86 (“In this instance, the Commission used one of

its statutory powers in the furtherance of NEPA, whose mandate

the Commission must follow. The Commission is under a dual obligation: to pursue the objectives of the Atomic Energy Act and

those of the National Environmental Policy Act. ‘The two statutes

and the regulations promulgated under each must be viewed in

Para (sic) Materia.’ We find that the Commission correctly discharged its responsibilities here.” (citation omitted) (quoting Citizens for Safe Power, Inc. v. NRC, 524 F.2d 1291, 1299 (D.C. Cir.

1975))).

App. 81

does not violate NEPA.”173 As we have already stated,

we have no authority to consider that issue. But we

find nothing in either the text of the LWA Rule or the

SOC that prohibits inclusion of the construction and

maintenance of a specific transmission line within the

scope of the proposed NRC action when those activities

qualify as a connected action under the applicable regulations and case law, as they likely do in this instance.

This may be an appropriate opportunity for the Commission to clarify whether, in the event of a conflict between general statements in the SOC and the specific

law that applies in the jurisdiction where the proposed

facility will be located, the Staff and licensing boards

should follow the controlling law in the jurisdiction

when defining or reviewing the scope of the proposed

action.

Impact of Excluding Transmission Corridor

from the Scope of Proposed Action

DTE and the Staff maintain that the question

whether the transmission corridor should have been

analyzed as a connected action rather than as part of

the cumulative impact analysis [40] is merely of academic interest because, they maintain, the Staff took

the required hard look at the corridor’s impacts.174 For

several reasons, we are not persuaded that the issue is

merely a matter of semantics.

173

174

72 Fed. Reg. at 57427.

Applicant Brief at 13; Staff Response at 11.

App. 82

First, excluding the transmission corridor from

the scope of the proposed action also removes it from

the limitation on actions in 10 C.F.R. § 51.101(a).175

When an activity is excluded from the scope of the proposed action, the effect is to allow construction to begin

– or even be completed – before the agency has completed its NEPA review. But NEPA’s purpose “is to influence the decision making process ‘by focusing the

[federal] agency’s attention on the environmental consequences of a proposed project,’ so as to ‘ensure . . .

that important effects will not be overlooked or underestimated only to be discovered after resources have

been committed or the die otherwise cast.’ ”176 “[W]hen

a decision to which NEPA obligations attach is made

without the informed environmental consideration

that NEPA requires, the harm that NEPA intends to

prevent has been suffered.”177 Thus, the NEPA analysis

of the proposed action must be completed before, not

after, construction begins. In this case, the Staff has

completed the FEIS for Fermi 3 and, as far as the

Board is aware, construction of the transmission corridor has not started. But the record of decision has not

been issued and, accordingly, the § 51.101(a) limitation

on actions remains in effect. Therefore, excluding the

transmission corridor from the scope of the proposed

action may allow construction of the corridor to begin

175

See supra Section II(B)(5).

Colo. Wild, Inc., 523 F.Supp.2d at 1219 (quoting Robertson v. Methow Valley Citizens Council, 490 U.S. 332, 349 (1989)).

177

Id. (emphasis omitted) (quoting Sierra Club v. Marsh, 872

F.2d 497, 500 (1st Cir. 1989) (Breyer, J.)).

176

App. 83

before the NRC has balanced the benefits of the Fermi

3 project against all of its environmental costs, despite

NEPA’s goal of a fully informed agency decision before

the [41] proposed action is authorized.

We are also not persuaded that excluding the

transmission corridor from the proposed action had no

effect on the depth of the environmental analysis. In

Colorado Wild, where the defendants made the same

argument as DTE and the Staff, the district court

found “fair grounds for litigation regarding Defendants’ assertion that the treatment of the highway interchanges and Village development as cumulative

impacts in the FEIS was sufficient under NEPA even

if these actions should have been treated as ‘connected

actions’ under the statute’s implementing regulations.”178 The administrative record reflected “a heated

debate” on that issue, and the court concluded that

“this debate would not have occurred unless the label

attached to these actions made a difference to the content, scope and/or depth of analysis.”179 We similarly

find that the Staff ’s refusal to evaluate the transmission corridor as a connected action may have “made a

difference to the content, scope and/or depth of analysis.” As we explain in Section II(D) below, the FEIS provided very limited information concerning the

transmission corridor’s impacts to wetlands, streams,

threatened and endangered species, and historical and

cultural resources. By contrast, the FEIS provides a far

178

179

Colo. Wild, Inc., 523 F.Supp.2d at 1225.

Id. at 1225-26.

App. 84

more in-depth analysis of the impact of the construction and operation of Fermi Unit 3 on those resources.180 It is likely that the Staff ’s decision to

exclude the transmission corridor from the scope of the

proposed action influenced the far more limited analysis it received.

[42]

Conclusion

There is a serious question whether the transmission corridor is a connected action under NEPA and

whether the Staff should have evaluated its environmental impacts as a direct effect of the proposed action.

D. There is a serious question whether the Staff ’s

consideration of environmental impacts related

to the transmission corridor, performed as a cumulative impact review, satisfies NEPA’s hard

look requirement.

Although the Staff did not consider the transmission corridor to be part of the proposed action, it

included some information about the corridor’s environmental impacts in its evaluation of cumulative impacts. The Staff and DTE claim that this analysis was

sufficient to satisfy NEPA requirements. We find,

180

See, e.g., FEIS at 2-33 to 2-44 and 2-66 to 2-78 (describing

impacts on wetlands and aquatic resources); id. at 2-48 to 2-59

and 2-82 to 2-125 (describing impacts on terrestrial and aquatic

species and habitats); id. at 2-195 to 2-207 (describing impacts on

historic and cultural resources).

App. 85

however, a serious question whether those requirements were satisfied.

“The principal goals of an FEIS are twofold: to

force agencies to take a ‘hard look’ at the environmental consequences of a proposed project, and, by making

relevant analyses openly available, to permit the public a role in the agency’s decision-making process.”181

The FEIS must comply with Sections 102(2)(A), (C),

and (E) of NEPA and the agency’s Part 51 regulations.182 NEPA Section 102(2)(C) requires that an EIS

provide a detailed statement concerning among other

things, “the environmental impact of the proposed action,” “any adverse environmental effects which cannot

be avoided should the proposal be implemented,” and

“any irreversible and irretrievable commitments of resources which would be involved in the proposed action

should it be implemented.”183 The Part 51 regulations

impose equivalent requirements.184 There is a serious

question whether the Staff satisfied those requirements [43] regarding transmission corridor impacts on

wetlands, streams, threatened and endangered species, and historical and cultural resources. The Staff

acknowledged that, in those areas, it lacked the

181

Claiborne, CLI-98-3, 47 NRC at 87 (citing Robertson, 490

U.S. at 349-50; Hughes River Watershed Conservancy v. Glickman, 81 F.3d 437, 443 (4th Cir. 1996)).

182

See 10 C.F.R. § 51.107(a)(1).

183

42 U.S.C. §§ 4332(C)(i), (ii), (v).

184

10 C.F.R. §§ 51.45(b)(1), (2), (5) (listing ER requirements);

id. § 51.71 (requiring that the DEIS address the matters specified

in § 51.45); id. § 51.90 (requiring that the Staff prepare the FEIS

in accordance with the requirements of § 51.71 for a DEIS).

App. 86

necessary surveys to determine the extent of impacts

to federally and state-listed species, wetlands, and

other resources. But, rather than obtaining the necessary information or explaining why it could not be obtained, the Staff assumed that the necessary surveys

would be conducted by other agencies in their regulatory reviews, that adequate mitigation to prevent environmental damage would be imposed by those other

agencies, and that accordingly the environmental impacts would be minimal. In so doing, the Staff effectively deferred the analysis required by NEPA until a

later date and delegated the NRC’s NEPA responsibilities to other agencies. An impact statement cannot fulfill its role of providing “a springboard for public

comment”185 if it defers indefinitely and delegates to

other agencies the duty to inform the public of the environmental impacts of the proposed action and potential measures to mitigate those impacts.

For example, concerning impacts of the transmission lines on “Important Terrestrial Species,” the FEIS

acknowledges that the United States Fish and Wildlife

Service (“FWS”) “identified several terrestrial species

that are listed under the [Endangered Species Act] or

candidates for listing that could occur in the area of the

proposed transmission line corridor, some of which are

not known to occur at the Fermi site.”186 The FEIS includes a table listing numerous federally and statelisted species that “[m]ay occur with the Transmission

185

186

Robertson, 490 U.S. at 349 (citation omitted).

FEIS at 2-61.

App. 87

Line Corridor.”187 But the FEIS fails to identify the species that do in fact occur within the corridor and the

potential impacts to those species. Instead, it states

that “[f ]ield surveys of the corridor [44] route have not

yet been conducted to confirm the presence of any species,”188 and that no additional monitoring is planned

along the proposed transmission line corridor.189 The

FEIS reports that “[p]rior to installation of the offsite

transmission line, FWS and [the Michigan Department of Natural Resources] would need to review detailed information on the transmission line corridor.

The agencies may, at that time, require surveys of the

proposed transmission line corridor for the presence of

important species and habitat.”190 In other words, the

surveys necessary to determine whether the transmission corridor will harm “important species and habitat”

were not conducted during preparation of the FEIS,

but may be conducted by other agencies at unknown

future dates, which may not be until after the NRC has

issued the COL. The Staff failed to explain why it did

not require such surveys to assist in preparation of the

FEIS.

Similarly, with regard to endangered or threatened freshwater species that may occur in streams

crossed by the transmission corridor, the FEIS fails to

provide the information necessary to determine either

187

Id. at 2-62.

Id. at 2-61.

189

Id. at 2-65.

190

Id. at 2-61.

188

App. 88

the species that will be affected or the extent of the

impacts. For example, concerning the Northern

Riffleshell, a federally listed endangered freshwater

mussel species, the FEIS explains that “[t]he survival

of this species depends on the protection and preservation of suitable habitat host fish species,” but that “it

is currently unknown if appropriate habitats are present in stream areas that are crossed by the proposed

transmission line corridor.”191 Concerning the Purple

Lilliput, a freshwater mussel species listed as endangered by the State of Michigan, the FEIS reports that

“it is currently unknown if appropriate habitats [45]

are present in stream areas that are crossed by the

proposed transmission line corridor.”192 As with terrestrial species, the FEIS includes a table (Table 2-16)

identifying “Federally and State- listed aquatic species

that have a potential to occur along the new transmission line route. . . .”193 But the Staff reported that “it is

not known whether suitable habitat or populations of

species identified in Table 2-16 occur in portions of the

drainage that would be crossed by the proposed transmission route.”194 Again, rather than identifying the

species that the transmission corridor will impact and

the nature of the impacts, the FEIS defers the analysis

until some unknown future date, informing the reader

that “[t]he [Michigan Department of Environmental

Quality (“MDEQ”)] and/or USACE may require

191

Id. at 2-104.

Id. at 2-105.

193

Id. at 2-101, 2-126.

194

Id. at 2-126.

192

App. 89

surveys of the proposed transmission line corridor to

evaluate the presence of important species and habitat.”195 As with terrestrial species, the Staff failed to

explain why it did not require such surveys so that the

necessary information could have been included in the

FEIS.

The East Lansing Field Supervisor of the FWS, in

his comments on the DEIS, was unable to concur in the

Staff ’s conclusions regarding the impact of the transmission corridor on threatened and endangered species:

You have also made a determination of effects

for the 29.4 miles of proposed transmission

lines associated with the project. We are not

able to concur with your effects determinations for the proposed transmission lines at

this time. Your evaluation indicates that

terrestrial and/or aquatic surveys for listed

species will be conducted once the location of

the transmission line corridors have been

finalized. We will defer concurrence with

your determinations until corridor locations

are finalized and we have reviewed the results of future surveys. We also recommend

that future surveys include those for the Indiana bat and for listed mussel species at

stream crossings when the stream bottom is

to be disturbed. Future consultation should be

completed prior to submission of Michigan

Department of Environmental Quality and/

or the Army Corps of Engineers permit

195

Id. at 2-126.

App. 90

applications for stream crossings or wetland

fill associated with [46] the transmission line

towers.196

The FEIS also states that the NRC, in conjunction

with the USACE, chose to comply with the National

Historic Preservation Act (“NHPA”) through the NEPA

process.197 As the lead Federal Agency in this process,

the NRC has responsibility for determining potential

impacts on the cultural environment under NEPA and

on historic and cultural resources that may qualify for

the National Register of Historic Places (“NRHP”) under NHPA § 106.198 However, as with other impacts, the

FEIS fails to fully evaluate the impact of offsite transmission lines on these historic and cultural resources.

Despite acknowledgement that “[t]he proposed new

approximately 11 mi transmission line route . . . has

been assessed as having a moderate to high potential

for identifying archaeological resources . . . , no Phase

I cultural resource investigations were conducted” during DTE’s preparation of the ER.199 Though NRC subsequently conducted 106 consultations with interested

federal, state, and tribal entities, the NRC did not consult on the impact of offsite transmission lines because

it does not consider “the building of transmission lines

[to be] an NRC-authorized activity” and considers the

“proposed transmission lines to be outside the NRC’s

196

Id., app. F, at F-23.

Id. at 2-193.

198

Id. at 5-91.

199

Id. at 2-207.

197

App. 91

[area of potential effects].”200 Thus, the Staff states only

that there is an “approximately 11-mi portion of the

proposed offsite transmission line route [that] will require a new transmission line route and may result in

impacts on historic and/or cultural resources” that

“could be minor” or “could be greater.”201

Despite the lack of essential information in these

and other areas, the Staff concluded [47] that the environmental impacts of the transmission corridor would

be minimal. In large part, it relied on permits and certifications it assumed would be issued and enforced by

other federal and state agencies. For example, concerning impacts on federally and state-listed aquatic species, the Staff stated that

[b]uilding of offsite transmission lines could

affect Federally and State-listed organisms in

the vicinity of stream crossings in the same

ways as described in the previous section for

commercially and recreationally important

species. Additional regulatory review of proposed plans for construction of the needed

transmission lines, which would be built,

owned, and maintained by ITC Transmission,

may be conducted by the MDEQ and/or

USACE, and potential impacts on Federally

and State-listed aquatic species are expected

to be addressed through mitigation measures

200

201

Id. at 2-212.

Id. at 4-101 to 4-102.

App. 92

and [Best Management Practices (“BMPs”)]

required under issued permits.202

The Staff ’s conclusion that wetland impacts would

be “minimal” similarly relied on permits and mitigation it assumed would be required by other agencies:

A conceptual transmission line corridor has

been identified, but wetland delineation

surveys have not yet been conducted to determine the precise locations and extent of

wetlands. Permanent impacts on wetland

areas would be mitigated according to a wetland mitigation plan ITC Transmission would

develop in coordination with the MDEQ and/

or USACE, as necessary. Any mitigation

measures required for the impacts are expected to be determined by ITC Transmission

in coordination with applicable regulatory

agencies, which may include the MDEQ

and/or USACE, at the time permit applications are submitted.203

The Staff also stated:

Offsite hydrological alterations are associated

with the proposed new or expanded transmission line corridors where the lines cross

wetlands and drainages. The impacts of hydrological alterations resulting from both onsite and offsite construction activities would

be localized and reduced with the implementation of BMPs and mitigation measures

202

203

Id. at 4-56 (emphasis added).

Id. at 4-44 to 4-45 (emphasis added).

App. 93

required by the necessary permits and certifications. Any impacts on USACE jurisdictional

water resources associated with the compensatory mitigation construction activities proposed by Detroit Edison would be evaluated

by the USACE during its permit evaluation

process.204

[48] As to impacts on historic and cultural resources, the Staff declared that “any further investigations to identify the presence of cultural and historic

resources and to evaluate the NRHP-eligibility of such

resources would be the responsibility of ITC Transmission, who would conduct such investigations in accordance with applicable regulatory and industry

standards to assess impacts.”205

Based on the foregoing review of the FEIS, the

Board has identified the following probable deficiencies.

Unavailable or Incomplete Information

The FEIS repeatedly states that the NRC lacked

the information necessary to fully evaluate the environmental impacts associated with offsite transmission lines. The FEIS failed to address CEQ’s NEPA

regulation requiring an agency to do more than simply

state that necessary information is unavailable206 –

204

Id. at 4-15 (emphasis added).

Id. at 4-102.

206

40 C.F.R. § 1502.22. The regulation requires an agency to

acquire the information that is lacking if it is “essential to a

205

App. 94

a regulation that “clearly contemplates original research if necessary.”207 A determination of minimal environmental impact would make little sense when an

agency lacks essential information and has not sought

to compile it through independent research. To rule

otherwise “would turn NEPA on its head, making ignorance into a powerful factor in favor of immediate action where the agency lacks sufficient data.”208 The [49]

FEIS makes no effort to explain why the NRC could

not obtain the information, spurning analysis in favor

of conclusory statements about the lack of environmental impact and assurances that any potential impacts will be remedied in the future. But, as the First

Circuit has stated, “[a] conclusory statement unsupported by . . . explanatory information of any kind not

only fails to crystallize issues, but affords no basis for

reasoned choice” and “costs of obtaining it are not exorbitant.” If

the costs are exorbitant, the regulation still requires the agency

to state that the information is unavailable, explain the relevance

of the unavailable information, summarize existing credible scientific evidence, and evaluate potential impacts.

207

Save Our Ecosystems v. Clark, 747 F.2d 1240, 1249 (9th

Cir. 1984) (“Federal agencies routinely either do their own studies

or commission studies of the particular area in which a proposed

project is to be located. Almost every EIS contains some original

research. And, almost every time an EIS is ruled inadequate by a

court it is because more data or research is needed.”). The court

cited district court interpretations that have imposed the same

NEPA requirement to conduct original research, if necessary. See,

e.g., Montgomery v. Ellis, 364 F. Supp. 517, 528 (N.D. Ala.1973)

(stating that “NEPA requires each agency to undertake research

needed adequately to expose environmental harms”).

208

Sierra Club v. Norton, 207 F. Supp. 2d 1310, 1334-35

(S.D. Ala. 2002).

App. 95

a comparison of the problems involved with the proposed project and the difficulties involved in the alternatives.”209

Reliance on Anticipated Certifications

As previously described, the Staff assumed in the

FEIS that because the transmission corridor will require permits from various federal and state agencies,

the construction and operation of the transmission corridor will have only small or minimal impacts on wetlands, streams, and endangered or threatened species.

There is a significant question whether such blanket

reliance on predicted future action by other regulatory

agencies is sufficient to satisfy NEPA’s hard look requirement.

In Calvert Cliffs Coordinating Committee, Inc. v.

Atomic Energy Commission, the D.C. Circuit explained

why merely referencing an actual or anticipated certification by another agency fails to satisfy NEPA requirements:

Certification by another agency that its own

environmental standards are satisfied involves an entirely different kind of judgment

[from that required by NEPA]. Such agencies,

without overall responsibility for the particular federal action in question, attend only to

one aspect of the problem: the magnitude of

certain environmental costs. They simply

209

Silva v. Lynn, 482 F.2d 1282, 1285 (1st Cir. 1973) (citations omitted).

App. 96

determine whether those costs exceed an allowable amount. Their certification does not

mean that they found no environmental damage whatever. In fact, there may be significant

environmental damage (e.g., water pollution),

but not quite enough to violate applicable

(e.g., water quality) standards. Certifying

agencies do not attempt to weigh that damage

against the opposing benefits. Thus the balancing analysis remains to be done. It may be

that the environmental costs, though passing

prescribed standards, are nonetheless great

enough to outweigh the particular economic

and technical benefits involved in the planned

action. The only agency in a [50] position to

make such a judgment is the agency with

overall responsibility for the proposed federal

action-the agency to which NEPA is specifically directed.210

The D.C. Circuit’s analysis is fully applicable to

the present case. For example, the Staff assumed that

damage to wetlands and other jurisdictional waters of

the United States would be minimal because permits

from the Corps would be required. But the Corps’ regulations do not require that it reduce all impacts to a

minimal level. When reviewing an application for a 404

permit under the Clean Water Act, the Corps evaluates

whether the issuance of the permit is in the public interest, weighing all relevant factors, including economic, environmental, and aesthetic concerns.211 The

210

211

Calvert Cliffs, 449 F.2d at 1123.

33 C.F.R. §§ 320.4(a)(1), 323.3(g).

App. 97

Corps may not issue a permit if there exists a “practicable alternative . . . which would have less adverse

impact on the aquatic system,” the permit would cause

“significant degradation of the water of the United

States,” or “appropriate and practicable” mitigation

has not been undertaken.212 However, the regulations

governing Corps review do not require that mitigation

measures insure minimal environmental impacts, as

the FEIS seems to suggest.

Moreover, the NRC’s Part 51 regulations prohibit

such blanket reliance on Clean Water Act permits:

Compliance with the environmental quality

standards and requirements of the Federal

Water Pollution Control Act (imposed by EPA

or designated permitting states) is not a substitute for, and does not negate the requirement for NRC to weigh all environmental

effects of the proposed action, including the

degradation, if any, of water quality, and to

consider alternatives to the proposed action

that are available for reducing adverse effects.213

[51] The Staff ’s reliance on predicted future regulation is also similar to the argument that the D.C. Circuit rejected in New York v. NRC.214 The NRC argued

that its environmental assessment did not need to deal

with the potential impacts of leaks from spent fuel

212

40 C.F.R. §§ 230.10(a), (c), (d).

10 C.F.R. § 51.71(d) & n.3.

214

New York v. NRC, 681 F.3d at 481.

213

App. 98

pools because its monitoring and regulatory compliance program would prevent such leaks. The court

stated:

That argument . . . amounts to a conclusion

that leaks will not occur because the NRC is

“on duty.” With full credit to the Commission’s

considerable enforcement and inspection efforts, merely pointing to the compliance program is in no way sufficient to support a

scientific finding that spent-fuel pools will not

cause a significant environmental impact during the extended storage period.215

Similarly, in the FEIS, the Staff relied on compliance programs of other federal and state agencies to

support its findings that the impact of the transmission corridor upon environmental resources will be

small or minimal. Such blanket reliance is subject to

serious question.

Inadequate Analysis of Mitigation

The FEIS’s limited discussion of mitigation suffers

from the same problem as its analysis of environmental consequences. Courts have held that an EIS must

include “a serious and thorough evaluation of environmental mitigation options.”216 “Mitigation must

be discussed in sufficient detail to ensure that

215

Id.

Miss. River Basin Alliance v. Westphal, 230 F.3d 170, 178

(5th Cir. 2000).

216

App. 99

environmental consequences have been fairly evaluated.”217 Rather than identifying and evaluating potential mitigation options, the FEIS merely assumes that

mitigation for the transmission corridor’s impacts to

wetlands, streams, and threatened and endangered

species will be adequately addressed in permit reviews

to be conducted by other agencies. As a result, the FEIS

fails to provide a detailed evaluation of potential mitigation [52] measures, as required, but only a series of

predictions that the issue will be adequately addressed

in other reviews.

Conclusion

There is a serious question whether the analysis

of transmission corridor impacts in the FEIS satisfies

NEPA’s hard look requirement.

E. Sua Sponte Review is Warranted

We have explained that the two issues the Board

has identified raise serious factual and legal questions

regarding the Staff ’s compliance with NEPA. Those issues can readily be distinguished from those likely to

arise in the ordinary case. First, the Staff ’s failure to

include the transmission corridor as part of the proposed action significantly reduced its scope, both in

terms of the total area affected and the environmental

resources that would be impacted. The Staff effectively

eliminated from the proposal nearly half of the total

217

Id. at 176-77 (quoting Robertson, 490 U.S. at 352).

App. 100

acreage that will be affected by the entire project.218

The Staff ’s narrow definition also meant that potential

impacts to important environmental resources were

excluded from the scope of the proposed federal action.

For example, as EPA noted in its comments on the

FEIS, the construction and maintenance of the new

transmission lines and substations are estimated to

impact “over 1000 acres of habitat, including over 93

acres of impacts to forested wetlands.”219 The construction and maintenance of the new transmission lines

will also potentially impact streams, threatened and

endangered species, and historic and cultural resources. Given the size of the transmission corridor

and the environmental resources it will affect, the corridor clearly represents a major component of the environmental impact of the Fermi Unit 3 project.

[53] The Staff might have compensated for its narrow definition of the proposed action by including in

the FEIS a thorough analysis of the potential environmental impacts of the transmission corridor, as the

agency committed to do in the SOC.220 But the Staff

instead deferred major components of the required

analysis to other agencies that it assumed would eventually undertake the necessary surveys and develop

218

The FEIS estimates the total acreage of the transmission

corridor as 1069.2 acres. FEIS at 2-47 (Table 2-7). The Fermi site

as defined in the FEIS (which includes the entire property owned

by DTE, not just the site of Fermi Unit 3) is 1260 acres. FEIS at

2-5.

219

EPA Comments on FEIS at 1.

220

72 Fed. Reg. at 57417, 57421.

App. 101

appropriate mitigation – even though such regulatory

actions, even if they occur as predicted, may not take

place until after the COL is issued. This gives rise to

the problem that the rule against segmentation seeks

to avoid, “when the environmental impacts of projects

are evaluated in a piecemeal fashion and, as a result,

the comprehensive environmental impacts of the entire Federal action are never considered or are only

considered after the agency has committed itself to

continuation of the project.”221

The Appeal Board observed that “in inquiring on

its own initiative into the transmission line question,

that Board was discharging an important function assigned to it. Licensing boards have independent responsibilities in the realm of the enforcement of the

NEPA command; i.e., their role is not confined to the

arbitration of those environmental controversies as

may happen to have been placed before them by the

litigants in the particular case.222 Though this responsibility has changed – now requiring Commission approval before a board may exercise its responsibility –

the authority still exists, as the Commission has made

clear.223 This authority [54] cannot reasonably be

221

72 Fed. Reg. at 57427-28.

Tenn. Valley Auth. (Hartsville Nuclear Power Plant,

Units 1A, 2A, 1B & 2B) ALAB-380, 5 NRC 572, 575 (1977).

223

Cincinnati Gas & Electric Co. (William H. Zimmer Nuclear Power Station, Unit 1), CLI-82-20, 16 NRC 109 (1982). The

Appeal Board has likewise stressed the need for licensing boards

to judiciously exercise the sua sponte authority when faced with

a serious, and unraised, issue. La. Power & Light Co. (Waterford

Steam Electric Station, Unit 3), ALAB-732, 17 NRC 1076 1111222

App. 102

limited to only a situation which “involves a significant

environmental impact of a type not considered previously” and “could destabilize an environmental resource or . . . involve[s] severe adverse environmental

impacts.”224 A serious environmental issue also exists

when an FEIS only cursorily deals with important environmental issues and concludes that impacts will be

small based largely on unavailable and incomplete information and predicted future certifications from

other agencies. A serious issue is also presented when

the Staff ’s NEPA analysis significantly understates

the scope of the proposed federal action, particularly

when it does so on a basis that conflicts with the law of

the federal judicial circuit where the new facility will

be located. Moreover, as justification for the agency’s

rule change excluding transmission lines and other

pre-construction activities from the scope of its proposed action, the NRC committed that “the effects of

the non-Federal activities would be considered during

any subsequent ‘cumulative impacts’ analysis.”225 It is

at least questionable whether the Staff ’s analysis of

the impact of offsite transmission lines satisfies this

commitment. The Staff ’s alleged failure to live up to a

commitment the NRC made to justify a significant

change in policy is a serious issue that a board should

be permitted to address.

12 (1983) (noting that Zimmer should not be read to present an

“insurmountable barrier” to the exercising of sua sponte authority).

224

Applicant Brief at 9.

225

72 Fed. Reg. at 57417.

App. 103

Although the FEIS may be deficient in significant

respects, a contested hearing may enable the Board to

cure those deficiencies and thus bring the agency into

compliance with NEPA and 10 C.F.R. Part 51. “Boards

frequently hold hearings on contentions challenging

the staff ’s final environmental review documents. . . .

In such cases, ‘[t]he adjudicatory record and Board decision (and . . . any Commission appellate decisions)

become, in effect, part of the FEIS.’ ”226 Thus, the Staff ’s

FEIS, along with the adjudicatory record, becomes the

relevant [55] record of decision for the environmental

portion of the proceeding.227 Federal courts of appeal

have approved of this process in which an EIS is effectively amended through the adjudicatory process.228

The Board’s review would encompass all pertinent information properly before it, including the FEIS and

the witness testimony and exhibits that were received

into evidence at the evidentiary hearing. The Board

would base its decision on whether the FEIS complies

with NEPA on those sources of information, and that

226

Nuclear Innovation N. Am. LLC (S. Tex. Project, Units 3

& 4) CLI-11-06, 74 NRC 203, 208-09 (2011) (citing Claiborne, CLI98-3, 47 NRC at 89 and Phila. Electric Co. (Limerick Generating

Station, Units 1 & 2), ALAB-819, 22 NRC 681, 705-07 (1985)).

227

See, e.g., Pac. Gas & Electric Co. (Diablo Canyon Power

Plant Indep. Spent Fuel Storage Installation), CLI-08-26, 68 NRC

509, 526 (2008), petition for review denied on other grounds, San

Luis Obispo Mothers for Peace v. NRC, 635 F.3d 1109 (9th Cir.

2011).

228

New England Coal. on Nuclear Pollution v. NRC, 582

F.2d 87, 93-94 (1st Cir. 1978); Citizens for Safe Power, 524 F.2d

at 1294 n.5. See also Ecology Action v. Atomic Energy Comm’n,

492 F.2d 998, 1001-02 (2d Cir. 1974).

App. 104

decision, along with the rest of the record for this proceeding, would in effect become part of the FEIS.

The Staff and DTE maintain, however, that if any

further inquiry needs to be made concerning the issue

raised by Contention 23, it should be made by the Commission during the mandatory hearing (also referred

to as an “uncontested hearing”) rather than in a contested hearing.229 But the mandatory hearing ordinarily takes place at the end of the licensing proceeding.230

If the FEIS is found deficient at that point, the need to

cure the deficiencies through amendment of the FEIS

could substantially delay the licensing process. The

Board, by contrast, can minimize the potential delay

by taking up the issue as soon as the Commission authorizes sua sponte review.231

[56] Furthermore, the uncontested hearing, unlike

a contested hearing, would make it more difficult to

cure deficiencies in the FEIS through the hearing process. Although several federal courts of appeal have

229

See Staff Response at 3, 12-16; Applicant Brief at 2 n.5.

The Staff’s target for completing the FSER is July 2015,

so the mandatory hearing will not take place before mid-2015 at

the earliest. Application Review Schedule, http://www.nrc.gov/

reactors/new-reactors/col/fermi/review-schedule.html.

231

In Zimmer, the Commission ordered a Licensing Board

not to exercise sua sponte authority because the Commission had

already initiated an “ongoing investigation” to deal with the issues raised. Zimmer, CLI-82-20, 16 NRC at 110. Here, by contrast, the NRC Staff has completed the FEIS, it has provided no

indication of any intent to revise the document, and the Commission has not instructed the Staff to reconsider the transmission

line issue.

230

App. 105

accepted that a contested hearing may cure deficiencies in the FEIS,232 no court of appeals has given the

same effect to an uncontested hearing. The function of

the uncontested hearing is only to review the adequacy

of the Staff ’s work, not to make a de novo inquiry into

NEPA issues.233 Thus, an uncontested hearing would

make it more difficult to cure deficiencies in the FEIS

by, for example, developing relevant information on the

environmental impacts of the transmission corridor

that the Staff omitted.

In addition, the uncontested hearing excludes

public participation in the review of the FEIS. Because

“[t]he scope of the Intervenors’ participation in adjudications is limited to their admitted contentions,” they

are “barred from participation in the uncontested portion of the hearing.”234 Thus, unlike contested proceedings, there is no public participation in an uncontested

(i.e., mandatory) hearing. The only participants would

be DTE and the Staff, with no opportunity for the Intervenors to offer evidence or to argue their position.

Thus, in substance, the Staff and DTE would limit any

further inquiry to a hearing in which they will participate but from which the Intervenors will be excluded.

But public participation is essential to the justification for allowing amendment of an FEIS through an

agency hearing. In the Limerick licensing proceeding,

232

See supra note 228 and accompanying text.

Dominion Nuclear N. Anna, LLC (Early Site Permit for

N. Anna ESP Site), CLI-05-17, 62 NRC 5, 35-36, 39 (2005).

234

Id. at 49.

233

App. 106

the Appeal Board had to determine whether the

presiding officer’s findings and conclusions modified

the FEIS in the absence of the agency regulation

that had previously required that they be given that

effect.235 The NRC’s NEPA regulations require a request for public comment on a DEIS and a [57] supplement to a DEIS distributed in accordance with 10

C.F.R. § 51.74,236 and on any supplement to the FEIS

prepared pursuant to 10 C.F.R. § 51.92(a) or (b).237 The

intervenor in the Limerick proceeding therefore argued that “NEPA’s purpose in providing the opportunity for public comment on an environmental

statement [would be] thwarted by board amendment

of an [FEIS].”238 The Appeal Board disagreed because

the licensing board’s hearing “arguably allows for additional and a more rigorous public scrutiny of the

[FEIS] than does the usual ‘circulation for comment.’ ”239 Given that the opportunity for rigorous public scrutiny of the FEIS was essential to the Appeal

Board’s decision that the FEIS could be amended

through the hearing process, eliminating such public

participation would weaken the rationale of that determination.

If the FEIS violates NEPA and Part 51, the Intervenors’ failure to file Contention 23 in response to

DTE’s ER will not excuse the agency’s violation. The

235

Id.

10 C.F.R. § 51.73.

237

Id. § 51.92(f)(1).

238

Limerick, ALAB-819, 22 NRC at 707.

239

Id.

236

App. 107

“primary responsibility for compliance with NEPA lies

with the Commission.”240 The issues here concern the

scope of the FEIS and its failure to adequately assess

the environmental impacts of a critical component of

the Fermi 3 project, basic issues that the Staff must

correctly evaluate whether or not they were raised by

Intervenors.241 Moreover, Intervenors previously notified the NRC of their concern by filing proposed Contention 23 in response to the DEIS. EPA raised the

same concern, arguing that the environmental impacts

of the transmission corridor should have been evaluated as direct effects of the proposed action. And the

Board itself raised the same issue in its ruling [58]

holding that the DEIS version of Contention 23 was

untimely.242 The Staff therefore had both the legal obligation to correctly define the scope of the FEIS and

ample notice that Intervenors, the EPA, and the Board

questioned whether the Staff had adequately fulfilled

that obligation. Thus, if Intervenors are correct that

the Staff should have analyzed the transmission corridor as a connected action and that the FEIS is materially deficient, Intervenors’ failure to file Contention 23

in response to the Applicant’s ER will not excuse the

agency’s potential violation of NEPA and Part 51.243

240

New York v. NRC, 681 F.3d at 482 (citing Pub. Citizen,

541 U.S. at 764). Accord Pa’ina Haw., LLC (Materials License Application), CLI-10-18, 72 NRC 56, 82 (2010).

241

See 10 C.F.R. § 51.29(a)(1).

242

See supra Section I(E).

243

See Vt. Dep’t of Pub. Serv. v. United States, 684 F.3d 149,

156 (D.C. Cir. 2012) (stating that, in an action under the Hobbs

Act for review of an NRC final order, exhaustion of remedies is

not a jurisdictional requirement).

App. 108

It would therefore be in the public interest to address

the issues now rather than postponing their resolution

indefinitely.

III.

CONCLUSION

For these reasons, the Board determines that sua

sponte review of the two issues previously described is

warranted and respectfully requests that the Commission authorize such review.

THE ATOMIC SAFETY

AND LICENSING BOARD

/RA/

Ronald M. Spritzer, Chairman

ADMINISTRATIVE JUDGE

/RA/

Dr. Anthony J. Baratta

ADMINISTRATIVE JUDGE

/RA/

Dr. Randall J. Charbeneau

ADMINISTRATIVE JUDGE

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