Amicus Curiae Brief — Entergy Corp. v. Riverkeeper, Inc.

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Nos. 07-588, 07-589, & 07-597 (Conslidated || E {)

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JUL 2 1 2008

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Supreme Court of the Unites’ States vs

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ENTERGY CORP., PSEG LLC AND

PSEG NUCLEAR LLC, AND

UTILITY WATER ACT GROUP,

Petitioners,

v.

RIVERKE. PER, INC., et al.,

Respondents.

¢

On Writs Of Certiorari To The

United States Court Of Appeals

For The Second Circuit

*

AMICUS CURIAE BRIEF OF THE

STATE OF NEBRASKA, ET AL. IN SUPPORT

OF THE UTILITY WATER ACT GROUP

+

JON BRUNING

Nebraska Attorney General

DaviID D. COOKSON

Chief Deputy

Counsel of Record

2115 State Capitol Building

Lincoln, NE 68509-8920

Tel: (402) 471-2682

Attorneys for Amici Curiae JULY 21, 2008

COCKLE LAW BRIEF PRINTING CO (800) 225-6964

OR CALL COLLECT (402) 42-2831

yweacli g

TroY KING

Attorney General

State of Alabama

11 South Union Street

Montgomery, AL 36130

Tel: (334) 242-7300

DUSTIN MCDANIEL

Arkansas Attorney General

323 Center Street, Suite 200

Little Rock, AR 72201

Tel: (501) 682-1019

JOHN W. SUTHERS

Attorney General

State of Colorado

1525 Sherman St., Seventh Floor

Denver, Colorado 80203

Tel: (303) 866-3052

BILL MCCOLLUM

Attorney General of Florida

The Capitol, PL-01

Tallahassee, FL 32399-1050

Tel: (850) 414-3300

STEVE CARTER

Attorney General of Indiana

IGC South, Fifth Floor

302 W. Washington St.

Indianapolis, IN 46204

Tel: (317) 232-6201

STEPHEN N. Six

Attorney General

State of Kansas

JARED S. MAAG

Deputy Solicitor General

120 Southwest Avenue, 2nd Floor

Topeka, KS 66612

Tel: (785) 296-7972

JACK CONWAY

COMMONWEALTH OF KENTUCKY

Attorney General

700 Capitol Avenue, Suite 118

Frankfort, KY 40601

Tel: (502) 696-5300

JAMES D. “BuDDY” CALDWELL

Attorney General

State of Louisiana

P.O. Box 94005

Baton Rouge, LA 70804

Tel: (225) 326-6705

MICHAEL A. Cox

Michigan Attorney General

525 W. Ottawa Street

P.O. Box 30212

Lansing, MI 48909

Tel: (517) 373-1124

JEREMIAH W. (JAY) NIXON

Attorney General of Missouri

Supreme Court Building

207 West High Street

Jefferson City, MO 65101

Tel: (573) 751-3321

Gary K. KING

Attorney General of New Mexico

408 Galisteo Street

Santa Fe, NM 87501

Tel: (505) 827-6000

WAYNE STENEHJEM

Attorney General of North Dakota

600 E. Boulevard Avenue

Bismarck, ND 58505-0040

Tel: (701) 328-2210

HENRY MCMASTER

Attorney General of the

State of South Carolina

P.O. Box 11549

Columbia, SC 29211-1549

Tel: (803) 734-3970

ROBERT E. COOPER, JR.

Attorney General

State of Tennessee

425 5th Avenue

P.O. Box 20207

Nashville, TN 37202-0207

Tel: (615) 532-2586

GREG ABBOTT

Attorney General of Texas

P.O. Box 12548

Austin, TX 78711-2548

Tel: (512) 936-1700

ROBERT F. MCDONNELL

Attorney General

WILLIAM E. THRO

State Solicitor General

Office of Attorney General

900 East Main Street

Richmond, VA 23219

Tel: (804) 786-2436

RAYMOND S. FRANKS II

General Counsel

WEST VIRGINIA DEPARTMENT OF

ENVIRONMENTAL PROTECTION

601 57th Street SE

Charleston, WV 25304

Tel: (304) 926-0499, ext. 1641

i

TABLE OF CONTENTS

Page

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INTEREST OF AMICI CURIAE STATES. ............ 1

SUMMARY OF ARGUMENT ......0...........0.........0: 2

EE rn ner oon Oo DE 3

I. THE SECOND CIRCUITS DECISION

Il.

UNDERMINES FUNDAMENTAL PRIN-

CIPLES OF COOPERATIVE FEDERAL-

A. The Rele of Cooperative Federalism in

American Environmental Law..............

B. The Clean Water Act Is an Exercise in

Cooperative Federalism ........................

STATES ARE IN THE BEST POSITION TO

MANAGE THEIR OWN RESOURCEG........

A. States Must Have the Authority to

Evaluate Site Specific Circumstances

in Determining the Appropriate

Technology to be Implemented............

B. States Implement a_ Holistic Ap-

proach to Regulation of the Power In-

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TABLE OF AUTHORITIES

Page

CASES

Arkansas v. Oklahoma, 503 U.S. 91, 112 S. Ct.

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Hodel v. Virginia Surface Mining and Reclama-

tion Assn., Inc., 452 U.S. 264, 101 S. Ct. 2352

Gee icosinsidecceiennlinliciedieliasatihitidaniinaiiainainiainialass aie rao 4

New York v. United States, 505 U.S. 144, 112

Ss Sais Ta UM cionsticinsssssuiceebitcsecncsebbtctenlepesenemeaceiiaacuaeiniaunaas 4

Save the Bay, Inc. v. EPA, 556 F.2d 1282 (5th

GE TIPE WP ctncicccctescosssetmiiseuiticcsianeiiaammaaiaae 4

South Carolina v. North Carolina, 2007 WL

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STATUTES

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TABLE OF AUTHORITIES — Continued

Page

OTHER AUTHORITIES

65 Fed. Reg. 29,073 n.13 (2000)............... ee ceeeeeeeeee eee eee 9

72 Fed. Reg. 37,459-69 (2007) ...............ccssscccscsssseceeeeees 9

1 Leg. Hist., 263 (statement of Representative

ESE ee 10

Philip J. Weiser, Federal Common Law, Coop-

erative Federalism, and the Enforcement of

the Telecom Act, 76 N.Y.U. L. Rev. 1692

a ae se eneebieateniecdnnes 5, 7

Robert L. Fischman, Cooperative Federalism

and Natural Resources Law, 14 N.Y.U. Envt'l

a 4,5,6

INTEREST OF AMICI CURIAE STATES

The Clean Water Act (“CWA”), 33 U.S.C. §§ 1251-

1387 (1972), represents a highly successful example

of cooperative federalism in the area of environ-

mental protection. State water pollution control

agencies exercise primary responsibility for imple-

menting its provisions.’ They are charged with carry-

ing out ambitious and complex water pollution

control programs, which the nation depends upon to

protect water supplies, recreational areas, aquatic life

and other uses of our water resources.

The interests of the amici curiae states are

twofold. First, the CWA is one of several federal

environmental statutes that embody a cooperative

federalism structure. The Second Circuit’s reasoning

would erode the cooperative element of cooperative

federalism and lead inexorably to the conclusion that

cooperative federalism is a facade. Second, the amici

curiae states have a strong interest in continuing

their longstanding practice of holistically managing

the resources within their state and considering both

costs and benefits in establishing the “best technology

available” as part of their permitting duties. The

Second Circuit’s vision of the CWA would bar states

from using cost-benefit analysis to both manage

" The State of New Mexico has not yet been granted pri-

macy under the Clean Water Act by EPA. Nevertheless, it

shares the interests of the other amici curiae states both as to

the Clean Water Act and as to other federal environmental

statutes that embody cooperative federalism.

2

natural resources and maximize the environmental

and economic benefits from electric generating facili-

ties in their states.

¢

SUMMARY OF ARGUMENT

The Second Circuit’s strict application of a “one

size fits all” philosophy eliminates the principle of

cooperative federalism between state permitting

agencies and the federal government. Given the wide

range of circumstances that impact whether a par-

ticular cooling system is appropriate for a given

intake structure, EPA and state permitting agencies

must have discretion to compare costs and benefits to

determine the appropriate technology to require of an

intake structure. Section 316(b)’s plain language does

not prohibit cost-benefit analysis, and prior case law

and other environmental statutory provisions support

the conclusion that cost-benefit analysis is a critical

tool for determining the “best technology available

for minimizing adverse environmental impact.” The

evisceration of this essential principle of the CWA

supports the reversal of the Second Circuit’s errone-

ous interpretation of § 316(b).

The Second Circuit held that EPA is prohibited

from comparing cost and benefits in determining the

“best technology available for minimizing adverse

environmental impact” from cooling water intake

structures, beyond simply selecting the less expensive

of two equally-effective technologies. In so holding,

the Second Circuit eliminated a critical tool used

3

by both EPA and state permitting agencies to deter-

mine the “best technology available,” a tool that

considers the site-specific factors affecting a particu-

lar structure on a particular water source. Given the

wide range of circumstances that impact whether a

particular cooling system is appropriate for a given

intake structure, EPA and state permitting agencies

must have discretion to compare costs and benefits to

determine the appropriate technology to require of an

intake structure.

J

ARGUMENT

I THE SECOND CIRCUIT’S DECISION

UNDERMINES FUNDAMENTAL PRINCI-

PLES OF COOPERATIVE FEDERALISM.

The Second Circuit’s decision should be reversed

because it upsets the relationship Congress intended

to engender between the federal government and the

states under one of this country’s most important and

pervasive environmental laws: the Clean Water Act.

The CWA represents a highly successful example of

cooperative federalism in environmental protection.

Under the CWA, state water pollution control agen-

cies exercise the primary responsibility for imple-

menting its provisions. They carry out ambitious and

complex water pollution control programs on stan-

dard setting, permitting and enforcement, total

maximum daily load (TMDL) development, water-

shed protection, water quality monitoring, assess-

ment, and data management, which the nation

depends upon to protect its natural resources.

4

A. The Role of Cooperative Federalism in

American Environmental! Law.

The Second Circuit’s decision in this case upsets

the fundamental federal-state relationship Congress

established in the Clean Water Act. Congress de-

signed the CWA as “a partnership between the States

and the Federal Government” to curb and control

pollution of the Nation’s waters. Arkansas v. Okla-

homa, 503 U.S. 91, 101, 112 S. Ct. 1046, 1054 (1992);

see also Save the Bay, Inc. v. EPA, 556 F.2d 1282,

1284 (5th Cir. 1977) (explaining that the Clean Water

Act “joined the Environmental Protection Agency and

the fifty states in a ... pollution battling alliance”).

This Court has termed such legal regimes “pro-

gram(s] of cooperative federalism.” New York uv.

United States, 505 U.S. 144, 168, 112 S. Ct. 2408,

2424 (1992), (quoting Hodel v. Virginia Surface Min-

ing and Reclamation Assn., Inc., 452 U.S. 264, 289,

101 S. Ct. 2352, 2366 (1981)).

“Cooperative federalism rose with the New Deal,

when the national government significantly height-

ened its presence in the operation of state programs.”

Robert L. Fischman, Cooperative Federalism and

Natural Resources Law, 14 N.Y.U. Envt’ L. J. 179,

* Other critical environmental statutes animated by

cooperative federalism principles include the Federal Insecti-

cide, Fungicide, and Rodenticide Act, 7 U.S.C. § 136(w)(1)(a), the

Safe Drinking Water Act, 42 U.S.C. § 300(gX2)a), the Resource

Conservation and Recovery Act, 42 U.S.C. § 6947(a), and the

Clean Air Act, 42 U.S.C. § 7410(k\(3).

5

185 (2005) (“Fischman”). Since that time, “cooperative

federalism typically appears as congressional or

administrative efforts to induce (but not coerce or

commandeer) states to participate in a coordinated

federal program.” Jd. at 184. Cooperative federalism

has “emerged from its‘significant but transient status

to become an enduring, organizing concept in envi-

ronmental law({,]” which has “proven the most fertile

ground for creating variations on the theme of coop-

erative federalism.” Jd. at 187, 188.

“Starting most notably with the environmental

protection statutes passed in the 1970's, federal

regulatory programs increasingly have relied on state

agencies to implement federal law.” Philip J. Weiser,

Federal Common Law, Cooperative Federalism, and

the Enforcement of the Telecom Act, 76 N.Y.U. L. Rev.

1692, 1695 (2001) (“Weiser”). “A critical feature of

cooperative federalism statutes is the balance they

strike between complete federal preemption (a pre-

emptive federalism) and uncoordinated federal and

state action in distinct regulatory spheres (a dual

federalism).” Jd. at 1697. “Rather than preempting

the authority of state agencies ... , cooperative

federalism programs invite state agencies to superin-

tend federal law.” Jd. at 1695.

As one scholar explains:

[U]Jnder the foundational pollution laws,

the Clean Air Act (“CAA”) and the [CWA],

cooperative federalism involves programs

where federal monies are made available to

each state contingent on its creation of a

6

regulatory scheme that is at least as strin-

gent as the federal floor. States may tailor

federal standards (e.g., water quality criteria

under the CWA), establish compliance strate-

gies (e.g., state implementation plans under

the CAA), implement permit programs (e.g.,

state pollutant discharge elimination sys-

tems under the CWA) and enforce rules (e.g.,

state administrative and judicial proce-

dures.).

Fischman at 189.

There are two key elements to the brand of

cooperative federalism embodied in the CWA: “(1) the

fostering of state administrative programs, and (2)

the delegation of tailored standard-setting.” Fisch-

man at 190. “In some cases, the cooperative federal-

ism statute takes the form of allowing state law to

operate within a federal scheme. Under the [CWA] for

example, state agencies ... are authorized to admin-

ister their own regulatory program under the mantle

of federal law.” Weiser at 1696 n.16, citing 33 U.S.C.

§ 1342.

Under the “flagship pollution control programs”

like the CWA, states are allowed “to implement their

own permit schemes in place of a federal permit

requirement.” Fischman at 191, citing 33 U.S.C.

§ 1342. Cooperative federalism also fosters diversity

in federal regulatory programs, which Congress has

seen fit to promote for at least three reasons: “(1) to

allow states to tailor federal regulatory programs to

local conditions; (2) to promote competition within a

7

federal regulatory framework; and (3) to permit

experimentation with different approaches that may

assist in determining the optimal regulatory strat-

egy.” Weiser at 1698.

B. The Clean Water Act Is An Exercise In

Cooperative Federalism.

Under the CWA’s program of cooperative federal-

ism, state water pollution control agencies are pri-

marily responsible for the statute’s implementation.

See 33 U.S.C. § 1251(b) (acknowledging that it is the

states’ “primary responsibilityl[y] ... to prevent,

reduce, and eliminate pollution”). Management of the

nation’s naturai resources depends on the leading

efforts of the states. Forty-six states operate permit-

ting programs for point-source discharges into state

waters through the National Pollution Discharge

Elimination System (“NPDES”). See CWA § 402(b); 33

U.S.C. § 1342(b). Under this program, discharge of

most regulated pollutants into the waters of the

United States is illegal without a valid NPDES

permit. States may also apply more stringent effluent

limitations in their NPDES permits than those set by

EPA. See 33 U.S.C. § 1370. States implement § 316(b)

through the NPDES permitting program.

Il. THE STATES CAN BEST DETERMINE

HOW TO MINIMIZE ADVERSE IMPACT.

Congress gave the States the primary role in

implementing the CWA for a reason — state permitting

8

authorities are best positioned to judge the needs of

local ecosystems and the impacts of particular regula-

tions on a state’s natur>! resources.

A. States Must Have the Authority to

Evaluate Site Specific Circumstances

in Determining the Appropriate Tech-

nology to be Implemented.

EPA’s Phase II Rule correctly recognized that it

could not take into account the wide variety of site-

specific circumstances influencing the nature or

impacts of impingement mortality and entrainment

in setting the national floor for cooling water intake

technology. EPA, therefore, appropriately allowed the

states to “tailor [§ 316(b)] ... to local conditions” and

“permit experimentation with different approaches

that may assist in determining the optimal regula-

tory strategy.” Weiser at 1698. This included the

authority, in circumstances where the costs or bene-

fits of compliance were out of alignment with EPA’s

national performance standards, to continue the

states’ long-standing practice of assessing the impact

on a waterbody.

Without the opportunity to provide site-specific

compliance options, states lack the authority to make

informed choices in balancing resource management

considerations. Taking account of local waterbody

characteristics is critical for states in writing permits

that prescribe the best technology available to mini-

mize adverse environmental impacts.

9

For example, in some waterbodies, the major fish

species that would incur impingement and entrain-

ment mortality is invasive. In those waterbodies, the

state’s best means of maintaining the native aquatic

organisms at that site is by writing permits that

prescribe once-through cooling technologies.* Simi-

larly, in states containing waterbodies with essen-

tially minimal aquatic life, the Second Circuit’s

decision would require technology to protect aquatic

organisms that are not present.*

As another example, eliminating the states’

ability to make site-specific decisions could have

adverse impacts on Florida’s West Indian Manatee

population, a federally listed endangered species.

Currently, Florida has numerous steam electric power

plants utilizing once-through cooling water systems.

These systems take m targe quantities of water for

cooling purposes and therefore discharge a large

quantity of warmed water to surface waters through-

out Florida. While manatees are not impacted by

impingement or entrainment from cooling water

intake structures, they do find refuge in the warm

water discharge areas of 12 Florida steam electric

* 65 Fed. Reg. 29,073 n.13 (Aug. 10, 2000); 72 Fed. Reg.

37,459-69 (July 10, 2007).

“ DCN:1-3003-BE at 308 (1974-75 impingement sampling at

Big Rock Nuclear Station in Michigan produced only 326 fish

weighing 49 pounds total); DCN:2-3021-BE at 207 (1974-75

impingement sampling at Ghent Electric Generation Staten

recovered only six fish).

10

power plants during the winter season. For over 60

years manatees have come to depend on these his-

torically consistent, warm water refuges. It is esti-

mated that 60% of the Florida manatee population

use these areas during the winter months. If these

warm water areas suddenly disappear as a result of

Florida’s inability to consider site-specific conditions,

the Florida manatee population could suffer signifi-

cant losses due to their dependence on these sites and

their inability to quickly adapt to alternative warm-

water habitat.° Preserving the states’ ability to ac-

count for site-specific conditions instead of requiring

a “one size fits all” technology, would enable Florida

to continue considering the effects on manatees in

order to develop long-term solutions when determin-

ing the best technology available.

Finally, in western and drought-stricken areas,

where water supplies are scarce, states must be

allowed to consider technologies that ensure that the

minimal water necessary is consumed.° Section 316(b)

does not plainly require EPA and the states to ignore

these and other site-specific conditions, and state

permitting authorities should be afforded consider-

able discretion to consider them when deciding what

is the “best technology available.”

* Fla. Dept. of Environmental Protection’s Comments on

EPA’s Proposed Reg. for NPDES Cooling Water Intake Struc-

tures at Phase II Existing Facilities (Aug. 7, 2002).

* 1 Leg. Hist. at 263 (statement of Representative Clausen)

(1973).

11

The Second Circuit’s decision requires EPA and

State permitting agencies to affirmatively ignore

legitimate alternatives and will have potentially

devastating effects on local and regional energy costs

and reliability. State permitting authorities will be

required to prescribe cooling systems at electricity

generating facilities that are costly to install and that

reduce the useable energy output of the plant. These

two factors will substantially increase energy costs

that, in many cases, will be passed on to residential,

industrial, and commercial consumers. Such in-

creases will be especially problematic due to the high

costs of other available energy sources, including

crude oil, heating oil, gasoline, and natural gas,

which are currently at, or near, record highs. By its

very terms, the Second Circuit’s decision ensures that

none of those costs and impacts will be justified by

corresponding benefits.’

* The only ostensible limitation set forth in the Second

Circuit’s decision arises when an industry cannot “reasonably

bear” the cost of a particular technology. This exception suffers

from the same “one-size-fits-all” flaws of the Second Circuit’s

rationale. In Nebraska, for example, electrical power is not

produced by private industry, but rather is the responsibility of a

political subdivision of the state. The citizens of Nebraska elect

the boards of the local power.districts and Nebraska citizens will

bear the burden of the rigidity of the Second Circuit’s decision.

12

B. States Implement a Holistic Approach

to Regulation of the Power Industry.

The Second Circuit’s decision also upsets the

holistic approach states use to regulate the power

industries within their borders.* In eliminating cost-

benefit considerations from the analysis of the proper

cooling system to implement, it is as if the Second

Circuit has presumed that § 316(b) operates within a

vacuum. Instead, § 316(b) is merely one piece of the

extensive regulatory authority vested in states: states

may also impose their own water quality standards

and thermal discharge limits on power plants and

may also grant variances when the situation war-

rants.” For many years the states have been evaluat-

ing these structures and managing them carefully.

Stepping back from this approach now would produce

serious consequences.

Implementing the lower court’s decision could

require state permitting authorities to write permits

that will adversely affect other aspects of the envi-

ronment, which states are charged with protecting.

For instance, the Second Circuit’s decision could

* See South Carolina v. North Carolina, Original Action in

Front of the United States Supreme Court, 2007 WL 2826231,

pp. 4-5 (June 7, 2007) (“Solving ... problems [arising out of a

shortage of water] is beyond the capabilities of any one agency

or group and ... cooperative cfforts between the various stake-

holders in the Catawba River Basin will be necessary to protect

the Basin’s water resources.”)

* NPPD Variance cited in MO River Brief.

13

require states with ozone pollution problems, but

healthy waterbodies, to mandate closed-cycle cooling

because the ozone precursor-impingement mortality

tradeoff was not sufficiently great on a national level

to allow EPA to provide for once-through cooling. The

resulting increase in production by the facility, to

compensate for the power penalty imposed by closed-

cycle cooling would exacerbate the ozone precursor

problem while the environmental benefits to the

already-healthy waterbody would be nominal.

Mandating closed-cycle cooling will also have

substantial negative impacts on residents and busi-

nesses of the Amicus States. EPA determined in the

Phase II Rule that requiring existing power plants to

retrofit would cost $2.26 billion and close nine power

plants. At a time when power supplies are under

stress nationwide and electric producers are faced

with a host of new requirements under the Clean Air

Act and CWA, requiring EPA and State permitting

agencies to ignore the cost of regulations in compari-

son to the benefits will force the industry to make

adjustments in production. The resulting adjustment

will inevitably Fave dire consequences for the public

in both the amount of electricity generated and the

costs to acquire that electricity.

Amicus States are not seeking that all states be

required to initiate a cost-benefit analysis whenever

environmental requirements are considered, includ-

ing under § 316(b). However, states should not be

forbidden from considering costs and benefits when

such a tool could help reach better decisions. The

14

diverse interests and conditions present in the amici

curiae states provide an accurate portrait of the

importance of the flexibility provided by EPA's inter-

pretation of § 316(b).

As a practical matter, the Second Circuit’s deci-

sion will force the states to impose the most stringent

intake structure requirements that can be technically

accomplished. As a result, states are prohibited from

taking into account local waterbody characteristics in

determining what technology is the “best,” and are

similarly prohibited from considering costs and

benefits. Such a stripping of the states’ ability to

consider the costs and benefits in determining the

appropriate cooling system to be implemented at a

site-specific location, and upholding a ruling which

woul’ require most power plants to convert to a

closed-cycle cooling system, would upset the careful

regulatory balance implemented by the states.

,%

-

CONCLUSION

The Second Circuit erred in ruling that EPA and

the states were prohibited from considering costs and

benefits to determine the “best technology available

for minimizing adverse environmental impact” from

cooling water intake structures. The Second Circuit’s

decision impairs the CWA’s cooperative federalism by

disempowering states from requiring the technology

that best suits the needs of the particular site in

question. Additionally, without the ability to use a

15

cost benefit analysis, the increased costs and other

consequences associated with installing new cooling

water intake systems will not be justified by any

determination of corresponding benefits to the ecosys-

tem and species affected. For the foregoing reasons,

the amici curiae states respectfully request that this

Court uphold EPA’s consideration of costs and bene-

fits as appropriate under § 316(b) and reverse the

ruling of the Second Circuit.

Respectfully submitted,

JON BRUNING

Nebraska Attorney General

Davip D. COOKSON

Chief Deputy

Counsel of Record

2115 State Capitol Building

Lincoln, NE 68509-8920

Tel: (402) 471-2682

Attorneys for Amici Curiae