Amicus Curiae Brief — Utility Water Water Act Group Group v. Riverkeeper, Inc. (Nos. 07-597, 07-588, 07-589)

bo

Supreme Court of the United F

‘ee

© 2,2| —

Nos. 07-588, 07-589 & 07-597 DEC 3- 2007

IN THE OFFICE OF THE CLERK

PREME COURT, U.S.

ENTERGY CORPORATION

Vv.

ENVIRONMENTAL PROTECTION AGENCY, ET AL.

PSEG FossiIL LLC AND PSEG NUCLEAR LLC

Vv.

RIVERKEEPER, INC., ET AL.

UTILITY WATER ACT GROUP

“4?

U.

RIVERKEEPER, INC., ET AL.

ON PETITIONS FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

BRIEF FOR THE

NUCLEAR ENERGY INSTITUTE

AS AMICUS CURIAE SUPPORTING PETITIONERS

ELLEN C. GINSBERG SETH P. WAXMAN

MICHAEL A. BAUSER Counsel of Record

NUCLEAR ENERGY EDWARD C. DUMONT

INSTITUTE BRIAN M. BOYNTON

1776 I Street, N.W. WILMER CUTLER PICKERING

Washington, D.C. 20006 HALE AND DORR LLP

(202) 739-8000 1875 Pennsylvania Ave., N.W.

Washington, D.C. 20006

(202) 663-6000

TABLE OF AUTHORITIES

INTEREST OF AMICUS CURIAE

TABLE OF CONTENTS

INTRODUCTION AND SUMMARY OF

I.

II.

AONE ETE ET

ARGUMENT

NUCLEAR POWER PROVIDES A CRITICAL

PORTION OF THE NATION’S ENERGY SUP-

PLY, PARTICULARLY IN LIGHT OF CLIMATE

THE COURT OF APPEALS’ DECISION COULD

FORCE RETROFITTING AT EXISTING NU-

CLEAR PLANTS, EVEN IF INDEPENDENT

REGULATORS WOULD OTHERWISE CON-

CLUDE THAT COSTS WHOLLY OUTWEIGH

EFT ane naa e aes Se ee

III. MANDATING USE OF CLOSED-CYCLE

COOLING AT EXISTING NUCLEAR PLANTS

WOULD HAVE SIGNIFICANT ADVERSE EF-

FECTS ON THE NATION’S POWER SUPPLY—

AND ON THE ENVIRONMENT. ...........cccesececeeeeseees

A. Mandating That Existing Plants Be

Retrofitted To Use Clee»!-Cycle Cool-

ing Would Reduce The Nation’s Supply

er

B. Reducing The Supply Of Nuclear

Power Will Have Substantial Adverse

Effects Both On The Energy Supply

And On The Environment ..................00000008

CONCLUSION

ii

TABLE OF AUTHORITIES

CASES

Page(s)

Chevron U.S.A. Inc. v. Natural Resources De-

fense Council, Inc., 467 U.S. 837 (1984).........eeeceeee 9

Massachusetts v. EPA, 1278S. Ct. 1488 (2007)................ 6

Riverkeeper, Inc. v. EPA, 475 F.3d 83 (2d Cir.

STF costinniiintaniintennnnsepstaenteenaininpuseipiiebiniennmnniiend 8, 9, 10

STATUTES AND REGULATIONS

ee I crcesecaiininienindetienindiiainiaitetaieniinnainesnincemanes 4

33 U.S.C.

TT iis icossithicns id eteiemianietatipetacdtsteninainintuiamemmmanunnpabesiniiniedl 9

SITs thiceidaiinitessisdainesiatbeemmannbiabieluiiamenaeatiinnanepinniiiets 9

Ey at isililctheccitipienenctineannipatastanciannisedmiaenaiitanmeniateteitiiddin 7

10 C.F.R.

UIT scciihjeeitesndenensainiseighanieetediiaiianeintiiinininimaianianipaiaiuiiiaetien 12

I ihe acta iain naan diiniaaaie alanis 12

National Pollutant Discharge Elimination

System—F inal Regulations To Establish

Requirements for Cooling Water Intake

Structures at Phase II Existing Facilities,

69 Fed. Reg. 41,576 (July 9, 2004)... passim

ADMINISTRATIVE AUTHORITIES

Comments of Department of Energy, Comment

ID 316bEFR.010.028, available at http://

www.epa.gov/waterscience/316b/phase2/co

mments/author-ph2. pdf .............csceeeeeeeeeeeeeeee 11, 16, 18

ili

TABLE OF AUTHORITIES—Continued

Comments of Goodwin Procter (submitted on

behalf of Entergy Corp.), Comment ID

316bEFR.029.035, available at http://www

.epa.gov/waterscience/316b/phase2/comme

nta/amthor-ph®.pdil........cccccccocsccsccoscecssecseorsseveeosees

Comments of the Nuclear Energy Institute,

Comment ID 316bEFR.020.002, available

at http://www.epa.gov/waterscience/316b/

phase2/comments/author-ph2.pdf.................-

Comments of UWAG, Comment ID

Page(s)

316bEFR.041.351, available at http://www

.epa.gov/waterscience/3 16b/phase2/comme

nD _ TE TE

FERC, Order Certifying North American

Electric Reliability Corporation as the

Electric Reliability Organization and Or-

dering Compliance Filing, 116 FERC

7 61,062 (July 20, 2006) ............scccsecssrseeseseseeees

OTHER AUTHORITIES

Climate Change 2007: Mitigation, Contribution

of Working Group III to the Fourth As-

sessment Report of the Intergovernmental

Panel on Climate Change (Cambridge

Univ. Press 2007), available at http://

www.mnp.nl/ipec/pages_media/AR4-chapte

| LETTE Aes Nee DORN CE . PLU RR ODT eT TT TDR

iv

5

TABLE OF AUTHORITIES—Continued

North American Electric Reliability Corpora-

tion, 2006 Long Term Reliability Assess-

ment: The Reliability of Bulk Power

Systems in North America (Oct. 2006),

available at http://www.nerc.com/~filez/

ee innttititacenstnibincigtuniencenndimnion

North American Electric Reliability Corpora-

tion, 2007 Long Term Reliability Assess-

ment: The Reliability of Bulk Power

Systems in North America (Oct. 2007),

available at http://www.nerc.com/~filez/

I eritccccnisetinsitemnistiniiiiainaniiaimion:

Nuclear Energy Institute, Environment:

Emissions Prevented (2007), available at

http://www.nei.org/resourcesandstats/nucle

ar_statistics/environmentemissionsprevent

SESE Ae aE EOE Sos oN IRE eT EE LE er

Status and Outlook for Nuclear Energy in the

United States (Aug. 2006), available at

http://nei.org/resourcesand-stats/document

hbrary/reliableandaffordableenergy/report

s/statusreportoutlook/. .............ccccsseceeeceeeseeeeees

Summary for Policymakers of the Synthesis

Report of the IPCC Fourth Assessment

Report (Nov. 16, 2007 draft), available at

i

Water & Sustainability (Volume 3): U.S. Wa-

ter Consumption for Power Production—

The Next Half Century (Elec. Power Re-

I

Page(s)

ccccccecece v

INTEREST OF AMICUS CURIAE

The Nuclear Energy Institute (NEI) represents

the commercial nuclear energy industry on regulatory

matters.’ NEI’s members include every entity licensed

by the Nuclear Regulatory Commission to generate

electricity at a commercial nuclear power plant in the

United States. Members also include nuclear plant de-

signers, major architecture and engineering firms, fuel

fabrication facilities, and other organizations and indi-

viduals involved in the nuclear energy industry.

The court of appeals’ interpretation of Section

316(b) of the Clean Water Act in this case will have a

significant impact on most, if not all, of the 38 U.S. nu-

clear power plants that do not currently use “closed-

cycle” cooling water systems. NEI can offer the Court

an informed perspective on the likely practical conse-

quences of the court of appeals’ decision.

'No counsel for a party authored this brief in whole or in

part, and no party or its counsel made a monetary contribution

intended to fund the preparation or submission of this brief. Peti-

tioners PSEG Nuclear LLC and Entergy Corporation, and certain

members of petitioner Utility Water Act Group w nuclear

plants, are members of NEI and make contributions that support

all of NEI’s activities, including the filing of amicus briefs. No

person other than NEI, its members, or its counsel made a mone-

tary contribution to the preparation or submission of this brief.

Counsel of record for all parties received timely notice of NEI’s

intent to file this brief, and letters from all parties consenting to

the filing of this brief have been submitted to the Clerk.

2

INTRODUCTION AND

SUMMARY OF ARGUMENT

The petitions for a writ of certiorari should be

granted because the court of appeals has misconstrued

the Clean Water Act in a way that is likely to cause

significant reductions in the nation’s supply of nuclear

power in the near and medium term. The court’s deci-

sion thus poses a substantial threat to the sufficiency of

the nation’s electric power supply, to the stability of the

electric power grid—and, perversely, to the very envi-

_ronmental values that the Clean Water Act and similar

statutes are designed to protect.

Refusing to defer to the EPA’s longstanding inter-

pretation of its statutory mandate, the court of appeals

has read Section 316(b) of the Clean Water Act to fore-

close the agency from comparing incremental costs and

benefits in determining what is, under particular cir-

cumstances, “the best technology available for minimiz-

ing [the] adverse environmental impact” caused by

cooling water intake structures. The court’s reasoning

may require the EPA to mandate that all of the nation’s

38 nuclear power plants that now use “once-through”

cooling be retrofitted to use “closed-cycle” systems.

Some plants, however, would likely find it either physi-

cally or economically impossible to comply with such a

mandate, and would shut down. Others would incur ex-

ceptional costs and be unable to produce power for up

to a year as they retrofit their systems. In addition,

every facility that switches to a closed-cycle system

will suffer a significant “energy penalty”—a permanent

decrease in generating capacity.

Already, the supply of energy in the United States

barely keeps pace with, and sometimes falls below, de-

mand. In the near term, capacity margins will only get

3

tighter. Because the output of nuclear plants is large

and constant, nuclear power plays a particularly impor-

tant role in maintaining the nation’s baseload power

supply. Reducing the supply of nuclear power would

have a disproportionately adverse effect on both the

adequacy of the amount of power supplied to, and the

stability of, the power grid.

Substantial time is required to secure approval for

and to construct new nuclear plants. I[f existing nuclear

plants are forced to close, either temporarily or perma-

nently, in the near and medium term their power out-

put could realistically be replaced only by plants that

burn fossil fuels. Unlike nuclear plants, fossil-fuel

plants produce greenhouse gases that are believed by

many to contribute to global climate change. That

would be, to say the least, an ironic result of over-

reading Section 316(b) to require the retrofitting of

cooling systems even where the EPA or responsible

state officials—not plant owners—would otherwise

conclude that the costs involved are wholly dispropor-

tionate to any environmental benefit that might be

achieved.

All this might be beside the point if, as the court of

appeals held, Section 316(b) were so clear on its face as

to leave no room for construction by the EPA. As peti-

tioners demonstrate, however, that is not the case. To

the contrary, the court of appeals adopted facially un-

reasonable limits on the sensible flexibility that Con-

gress conferred here, as it typically does, on the expert

agency it relies on to interpret and administer a broad

statutory mandate. That error threatens very serious

consequences, and it merits this Court’s review.

4

ARGUMENT

I. NUCLEAR POWER PROVIDES A CRITICAL PORTION OF THE

NATION’S ENERGY SUPPLY, PARTICULARLY IN LIGHT OF CLI-

MATE CHANGE

The supply of power in the United States is under

strain. At times, supply in some areas can barely meet

demand. During the summer of 2006, for example, a

heat wave “required utility system operators, custom-

ers, and government agencies to implement emergency

procedures in some areas.” North American Electric

Reliability Corporation (NERC), 2006 Long Term Re-

liability Assessment: The Reliability of Bulk Power

Systems in North America 5 (Oct. 2006), available at

http://www.nerc.com/~filez/rasreports.html.? Blackouts

were avoided principally “because generating capacity

performed extremely well during this period.” /d.

The problem is likely to get worse before it gets

better. Over the next ten years, the utility industry

expects peak demand to increase by over 17%, while

committed generating capacity is expected to increase

by only 8.4%. NERC, 2007 Long Term Reliability As-

sessment: The Reliability of Bulk Power Systems in

North America 10 (Oct. 2007) (2007 NERC Assess-

ment), available at http://www.nerc.com/~filez/rasre

ports.html. In a number of regions, capacity margins

are expected to drop well below target levels. Jd. at 24.

? NERC is the entity certified by the Federal Energy Regu-

latory Commission as the single “Electric Reliability Organization”

for the United States under Section 215 of the Federal Power Act,

16 U.S.C. § 8240(c). See Order Certifying North American Elec-

tric Reliability Corporation as the Electric Reliability Organiza-

tion and Ordering Compliance Filing, 116 FERC § 61,062 (July

20, 2006).

5

Against this backdrop, nuclear power plants are an

exceedingly important source of power. There are cur-

rently 104 operating units at more than 60 nuclear

plants in the United States. These plants generate ap-

proximately 20% of the nation’s electricity... Along with

coal and natural gas, nuclear energy is a foundational

part of the nation’s power supply.

Nuclear power is a particularly important source of

generation because of its cost stability and output reli-

ability. The supply and cost of nuclear power do not

fluctuate significantly based on weather or climate con-

ditions, fuel cost variability, or the vagaries of foreign

suppliers. Nuclear plants are able to operate without

interruption for extended periods, up to 24 months at a

time. Because nuclear power can be so reliably gener-

ated, it helps supply the “baseload” of electricity that is

required for the national electric power grid to func-

tion. Indeed, the stability of the grid depends on nu-

clear power.

Nuclear energy is also comparatively inexpensive.

Nuclear plants are currently estimated to be the low-

est-cost producers of baseload electricity.‘ The consis-

tent availability of nuclear power at predictable prices

> See Comments of the Nuclear Energy Institute, Comment

ID 316bEFR.020.002, at 407. The comments cited in this brief

are available at http//www.epa.gov/waterscience/316b/phase2/

comments/author-ph2.pdf. The page citations provided are to this

compilation of the comments.

* See Status and Outlook for Nuclear Energy in the United

States 3-4 (Aug. 2006), available at http://nei.org/resourcesand

stats/documentlibrary/reliableandaffordableenergy/reports/status

reportoutlook/.

6

also has a stabilizing effect on the electricity market as

a whole.

Finally, nuclear power is increasingly cited as an

important part of efforts to minimize adverse environ-

mental impacts. As this Court has recognized, the

world faces serious threats from global climate change.

See Massachusetts v. EPA, 127 S. Ct. 1488, 1455 (2007).

Many believe that climate change is caused in signifi-

cant part by the emission of greenhouse gases, includ-

ing carbon dioxide. Nuclear plants emit no such gases.

For that reason, the United Nations Intergovernmen-

tal Panel on Climate Change, which recently shared the

Nobel Peace Prize for its work on global warming,

listed “nuclear energy” in its recently released Fourth

Assessment Report as a “key” technology for mitigat-

ing greenhouse gas emissions—a technology, impor-

tantly, that is “currently commercially available.”®

This point has concrete application in the United

States today. Nuclear power plants—not solar or wind

or other “alternative” energy sources—generate some

* See Summary for Policymakers of the Synthesis Report of

the IPCC Fourth Assessment Report 17 (Nov. 16, 2007 draft),

available at http://www.ipec.ch/; see also Climate Change 2007:

Mitigation, Contribution of Working Group III to the Fourth As-

sessment Report of the Intergovernmental Panel on Climate

Change 269 (Cambridge Univ. Press 2007), available at

http://www.mnp.nl/ipee/pages_media/AR4-chapters.html (“Total

life-cycle [greenhouse gas) emissions per unit of electricity pro-

duced from nuclear power are .. . similar to those for renewable

energy sources. Nuclear power is therefore an effective [green-

house gas] mitigation option, especially through license extensions

of existing plants enabling investments in retro-fitting and up-

grading.” (citations omitted)).

7

71% of all carbon-free electricity in America.® In-

creased electricity production by nuclear power plants

is responsible for one-third of all reductions of carbon

emissions by U.S. industry since 1993 as part of the

Department of Energy’s Climate Challenge and Cli-

mate Vision programs. Using nuclear power instead of

fossil-fuel-burning power plants prevents almost 700

million metric tons of carbon dioxide emissions. For

perspective, the volume of greenhouse gas emissions

prevented by the use of nuclear power in the United

States is equivalent to taking more than 90% of all pas-

senger cars off the nation’s roadways.

Il. THE COURT OF APPEALS’ DECISION COULD FORCE RETRO-

FITTING AT EXISTING NUCLEAR PLANTS, EVEN IF INDEPEND-

ENT REGULATORS WOULD OTHERWISE CONCLUDE THAT

COSTS WHOLLY OUTWEIGH BENEFITS )

Section 316(b) of the Clean Water Act directs the

EPA, in establishing discharge standards under Sec-

tions 301 and 306 of the Act, to “require that the loca-

tion, design, construction, and capacity of cooling water

intake structures reflect the best technology available

for minimizing adverse environmental impact.” 33

U.S.C. § 1826(b). In applying that provision to existing

power plants, the EPA concluded that it could and

should compare the costs of adopting particular tech-

nologies to their expected incremental benefits. See

National Pollutant Discharge Elimination System—

Final Regulations To Establish Requirements for

Cooling Water Intake Structures at Phase II Existing

° The factual points in this paragraph are drawn from a more

detailed discussion, Environment: Emissions Prevented, available

on NEI’s website at http//www.nei.org/resourcesandstats/nucle

ar_statistics/environmentemissionsprevented/.

8

Facilities, 69 Fed. Reg. 41,576, 41,576, 41,583 (July 9,

2004) (Phase II Rulemaking). This conclusion was in

keeping with the EPA’s 30-year history of taking costs

and benefits into account in determining under Section

316(b) what was the “best technology available” for

large power plants—including the plants approved and

constructed during that period, which are now “exist-

ing facilities” subject to the Phase II regulations.

Accordingly, the EPA decided that existing plants

should not be required to adopt closed-cycle cooling,

even though that was the “best technology available”

for new plants, because the cost considerations are radi-

cally different. See 69 Fed. Reg. at 41,605-41,606. Like-

wise, the agency concluded that a facility could seek

special determination of the “best technology available”

at a particular site “by demonstrating ... that its costs

would be significantly greater then the benefits of com-

plying with [the generally applicable] performance

standards at the facility.” Jd. at 41,603.

The court of appeals held that the text and struc-

ture of the Clean Water Act foreclose the EPA’s ap-

proach. See Riverkeeper, Inc. v. EPA, 475 F.3d 83, 98-

99, 114 (2d Cir. 2007). As petitioners PSEG, UWAG,

and Entergy demonstrate, that is incorrect. See PSEG

Pet. 17-27; UWAG Pet. 16-28; Entergy Pet. 25-35. We

do not repeat the entire analysis here. We do note,

however, that the court of appeals’ reasoning is at war

even with itself.

The court recognized that the word “available” is

capacious enough to permit rejection of a technology so

expensive that its cost could not be “reasonably borne”

by “the industry” as a whole. See 475 F.3d at 99. The

court never explained exactly what it meant by “the

industry” bearing costs, but the formulation suggests

9

that the court would accept that a technology is not

“available” if implementing it would be cost-prohibitive

for a sufficient number of individual firms and their

customers. If the statute can bear that meaning, it can

also bear the interpretation adopted by the EPA—in

effect, that a technology is not the “best technology

available” in any particular instance if, under all the

circumstances, the particular plant operator involved

cannot reasonably be asked to bear the cost of imple-

menting it. While the court of appeals preferred to

draw the “availability” line in one place rather than the

other, once it conceded that there was a line to be

drawn, the specific placement was not its decision to

make. See Chevron U.S.A. Inc. v. Natural Res. Def.

Council, Inc., 467 U.S. 837, 842-843 (1984).

Similarly, the court of appeals purported to draw

support for its interpretation of Section 316(b) from

other sections of the Clean Water Act. 475 F.3d at 97-

98. But the provisions upon which the court relied ex-

pressly permit EPA to consider “such other factors as

[it] deems appropriate,” 33 U.S.C. § 1314(b)(2)(B), as

well as “the cost of achieving [the] effluent reduction,”

id.; id. § 1316(b)(1)(B). Rather than support the court

of appeals’ decision, these provisions confirm its error.

The court of appeals stopped short of expressly or-

dering the EPA to mandate retrofitting of all existing

plants to use closed-cycle cooling. Respondents, how-

ever, will no doubt argue that the court’s reasoning re-

quires that result. See 475 F.3d at 102 (stating that the

court’s “concern with the EPA’s determination with

respect to section 316(b) is further deepened by the

Agency’s rejection of closed-cycie cooling and selection

of a suite of technologies as the basis for BTA”); id. at

103 & n.16 (expressing doubt as to whether a suite of

technologies could “approach{] the performance of

10

closed-cycle cooling” (internal quotation marks omit-

ted)); id. at 105 (remanding “for clarification . . . and

possibly for a new determination of BTA”). The EPA

may feel constrained to agree. Because the court of ap-

peals expressly read Section 316(b) to prohibit any use

of restoration methods, id. at 108-110, that approach

will no longer be available on remand. In light of the

court of appeals’ severe limitation on the EPA’s ability

to consider costs, closed-cycle cooling may be the only

technological solution left open to the agency.

The EPA has already determined that retrofitting

plants to use closed-cycle cooling generally will reduce

impingement and entrainment to a greater degree than

upgrading the design and construction of water intake

structures at once-through plants. See 69 Fed Reg.

41,576, 41,606.’ While the reductions achievable using

other technologies “approach{[]” those from closed-cycle

cooling, respondents will surely argue that they are not

“essentially the same” in the only sense that the court

of appeals would recognize as allowing selection of the

lower-cost alternative. See 475 F.3d at 100-101. If that

is correct, the court’s decision will require the EPA to

mandate retrofitting of all existing plants to use closed-

cycle cooling, so long as the billions of dollars that ret-

rofitting would cost could theoretically be borne by the

industry as a whole.

’ The EPA determined that “closed-cycle, recirculating cool-

ing systems (e.g., cooling towers or ponds) can reduce mortality

from impingement by up to 98 percent and entrainment by up to

98 percent when compared with conventional once-through sys-

tems” in fresh water. /d. at 41,601. In contrast, the FPA’s per-

formance standards contemplating adoption of other technologies

called for reduction of impingement “by 80 to 95 percent” and re-

duction of entrainment “by 60 to 90 percent.” /d. at 41,598.

1]

Ill. MANDATING USE OF CLOSED-CYCLE COOLING AT EXISTING

NUCLEAR PLANTS WOULD HAVE SIGNIFICANT ADVERSE EF-

FECTS ON THE NATION’S POWER SUPPLY—AND ON THE EN-

VIRONMENT

The Phase II regulations struck down by the court

of appeals cover all 104 nuclear power units currently in

operation in the United States. Sixty-one of those units

currently use once-through cooling. If all existing

plants are required to convert to closed-cycle cooling,

some will likely close entirely, and all will be subject to

temporary closures of up to a year and suffer perma-

nent decreases in net generating capacity. These clo-

sures and losses in efficiency would significantly dimin-

ish the nation’s supply of nuclear power, contributing to

shortfalls in generation, grid instability, and environ-

mental harm. In part for these reasons, the Depart-

ment of Energy “strongly” recommended to the EPA

during the Phase II rulemaking that it “not include any

requirement that has the effect of forcing any class of

facilities to install wet [closed-cycle] cooling towers.”

Comments of Department of Energy, Comment ID

316bEFR.010.028, at 185.

A. Mandating That Existing Plants Be Retrofitted To

Use Closed-Cycle Cooling Would Reduce The Na-

tion’s Supply Of Nuclear Power

Retrofitting existing nuclear plants to use closed-

cycle cooling is at best a complicated, costly, and time-

consuming process, and may not be possible or eco-

nomically feasible at some plants. Closed-cycle cooling

requires the construction of large towers to re-cool the

water between cycles. Just finding the space for these

towers is a significant challenge for many plants. In

rejecting mandatory closed-cycle retrofits, the EPA

noted that “31 out of 56 plants surveyed said that they

would need to acquire additional property to accommo-

12

date cooling towers.” 69 Fed. Reg. at 41,605. Even

leaving aside cost, the agency recognized that there

may be significant impediments to the acquisition and

development of that additional land. /d.

To begin with, in some locations, especially in urban

areas, it may be difficult or impossible to obtain suffi-

cient vacant or clearable land adjacent to the existing

plant site. 69 Fed. Reg. at 41,605. Moreover, even

where land is nominally available, developing it for

cooling-tower use may present daunting challenges.

For example, retrofitting the Diablo Canyon plant on

the central California coast, if it could be done at all,

would require excavating a 1600-foot by 600-foot sec-

tion of the Las Cafiadas coastal hills adjacent to the

plant to make room for the construction of 132 60-foot-

tall water tower cells.* Retrofitting the San Onofre

Nuclear Generating Station, on the coast between San

Diego and Los Angeles, likely would require construc-

tion of cooling water tanks at the top of 100-foot bluffs

overlooking the beach adjacent to the plant.

If the land necessary for cooling towers could be

obtained, a plant owner would need to acquire federal,

state, and possibly local permits to proceed with retro-

fitting. For example, some retrofits would require a

license amendment from the Nuclear Regulatory Com-

mission, which requires a formal approval process gen-

erally involving public hearings. See 10 C.F.R. § 50.91.’

* Unless otherwise indicated, examples in this brief are drawn

from information provided by plant operators.

7 A license amendment is required if a proposed change to a

nuclear plant involves, among other things, a modification to tech-

nical specifications. See 10 C.F.R. § 50.59(c1)(i). Whether retro-

13

Obtaining such amendments would consume substantial

public and private resources. This would occur at a

time when the Commission and industry are concen-

trating on applications to renew operating licenses at

existing nuclear plants and on licensing and construct-

ing new plants that are necessary to meet the expand-

ing demand for power. __

Ironically, efforts to obtain the permits necessary

to address what the court of appeals viewed as the fish-

protection requirements of the Clean Water Act could

well be hampered by adverse environmental impacts of

other sorts that might result from retrofitting plants to

use closed-cycle cooling. For example, salt-water cool-

ing towers produce large plumes of salt water vapor

that can contribute to fogging and icing in the sur-

rounding area and affect nearby electrical equipment.

One may anticipate concern about increased noise. The

prospect of extensive construction in sensitive areas,

‘such as around the coastal Diablo Canyon and San On-

ofre plants, would raise substantial concerns that could

delay or even preclude obtaining necessary approvals.

As the EPA noted, for example, expanding some plants

might require displacement of ecologically valuable

wetlands. 69 Fed. Reg. at 41,605. Similarly, the San

Onofre plant is surrounded by federal and state lands

that support species protected by state and federal

laws.

Apart from land and permits, retrofitting large ex-

isting plants to use closed-cycle cooling would be a sig-

nificant engineering challenge. Among other things,

closed-cycle cooling requires an extensive network of

fitting to use closed-cycle cooling would require a license amend-

ment would be a plant-specific determination.

14

pipes to circulate water to and from the plant’s con-

densers. For example, it is estimated that retrofitting

the Salem Generating Station to use closed-cycle cool-

ing would require the demolition or abandonment of

over three miles of existing 7-foot and 10-foot diameter

circulating pipe and the installation of over 4 miles of

new 7-foot pipe. See, e.g., Comments of UWAG, Com-

ment ID 316bEFR.041.351, at 1330. Additionally, many

plants would need to reinforce their condensers to

withstand the increased pressure resulting from closed-

cycle cooling and otherwise modify them for use with

the retrofitted system.

For all these reasons, where retrofitting nuclear

plants to use closed-cycle cooling is possible at all, it

would be very—sometimes prohibitively—expensive.

As the EPA concluded:

[A] national requirement to retrofit existing

systems is not the most cost-effective approach

and at many existing facilities, retrofits may be

impossible or not economically practicable.

EPA estimates that the total capital costs for

individual high-flow plants (i.e., greater than 2

billion gallons per day) to convert to wet tow-

ers generally ranged from $130 to $200 million,

with annual operating costs in the range of $4

to $20 million ....

69 Fed. Reg. at 41,605.

Indeed, the EPA recognized that, for a variety of

reasons, its substantial cost estimates “may not fully

reflect the costs of the option.” 69 Fed. Reg. at 41,605.

Consistent with that recognition, forecasts by individ-

ual plant operators run even higher. The Edison Elec-

tric Institute, the association of U.S. shareholder-

owned electric companies, has estimated that retrofit-

15

ting the 38 existing once-through nuclear plants with

closed-cycle cooling would cost between $10 billion and

$19 billion.’ Estimates of the cost of retrofitting all ex-

isting once-through plants with closed-cycle cooling

submitted to the EPA by petitioner UWAG ranged

from $40 to $66 billion. See UWAG Pet. 37. Using the

high end of the EEI range, the average cost per nuclear

plant would be $500 million. For each of four plants—

Diablo Canyon, Salem Generating Station, San Onofre,

and Indian Point—EEI or plant owners estimate that

the cost of retrofitting could total $1 billion or more. At

Diablo Canyon alone, retrofitting could cost in the

range of $2.4 billion.

If retrofitting proceeds at any given plant even in

the face of these geographical, governmental, environ-

mental, technical, and financial challenges, it can re-

quire shutting the plant down for prolonged periods.

The EPA estimated that plants would be unavailable

for as long as 10 months. See 69 Fed. Reg. at 41,605.

Private estimates suggest that retrofitting Diablo Can-

yon and San Onofre would render the plants unavail-

able for 12 months or more, that Indian Point would be

closed for approximately 10 months, and that Oyster

Creek would have to be shut down for more than four

months. Extended outages would also be anticipated at

the Salem facility. See PSEG Pet. 34 (estimating that a

closed-cycle retrofit “would require partially suspend-

ing operations for at least 14 months, causing a net loss

of 1150 megawatts . .. during that period”).

~—<

° This range is derived from cost estimates submitted to the

EPA adjusted with some site-specific cost estimates provided by

individual operators.

16

Finally, once returned to operation, retrofitted

plants would produce less usable power than they did

before. A steam power plant’s condenser “operates un-

der vacuum conditions (i.e. a pressure below normal

atmospheric pressure).” Comments of the Department

of Energy, Comment ID 316bEFR.010.101, at 239. Be-

cause cooling water in once-through systems has on av-

erage a lower temperature than water in closed-cycle

cooling systems, the vacuum created in once-through

systems is greater than in closed-cycle systems, which

increases efficiency. Jd. In addition, closed-cycle sys-

tems require more power to run the cooling system it-

self, leaving less for consumers.

In its Phase II rulemaking, the EPA relied on an

estimate by the Department of Energy that the “en-

ergy penalty” resulting from converting existing once-

through plants to closed-cycle cooling would generally

amount to a 2.4% to 4.0% decline in energy production

capacity. 69 Fed. Reg. at 41,605. The EPA noted a

5.3% energy penalty associated with the use of closed-

cycle cooling for one nuclear plant that provides 78% of

the electricity for Vermont. See id. Using the same

DOE figures relied upon by the EPA, it has been esti-

mated that retrofitting all existing nuclear plants to use

closed-cycle cooling would reduce overall capacity by

2,117 megawatts. As the EPA explained with respect

to both nuclear and non-nuclear plants, “on average 20

additional 400-MW plants might have to be built to re-

place the generating capacity lost by replacing once-

through cooling systems with wet cooling towers if

such towers were required by all Phase II facilities.”

Id.

In short, if the court of appeals’ decision stands and

requires the EPA to mandate retrofitting of closed-

cycle cooling at all existing nuclear power plants, some

17

of those plants will likely find it physically or economi-

cally impossible to continue operation, and all will face

temporary closures and permanent reductions in gen-

erating capacity. Either way, requiring retrofitting

would significantly reduce the nation’s supply of nu-

clear energy.

B. Reducing The Supply Of Nuclear Power Will Have

Substantial Adverse Effects Both On The Energy

Supply And On The Environment

The reduction in capacity caused by mandating ret-

rofitting of existing nuclear plants will have a number

of significant adverse impacts.

First, even if all plants ultimately remain in opera-

tion, the significant energy penalty caused by the use of

closed-cycle cooling would by itself have a significant

adverse impact on the power supply. While the lost ca-

pacity could eventually be replaced, in the short term

air quality limitations would likely prevent fossil-fuel

plants from meeting the entire shortfall, and existing

nuclear plants lack additional capacity. In areas of the

country already facing energy constraints, such as Cali-

fornia and the mid-Atlantic/Northeast corridor, the

near-term reduction in capacity would increase the like-

lihood of brownouts and blackouts during the summer

months.

Loss of the power generated by nuclear plants that

are forced to close would substantially exacerbate the

problem. For example, in its comments to the EPA,

petitioner Entergy estimated that if its Indian Point

nuclear plant were to close, target reserve margins in

New York could not be met and “the calculated number

of days where emergency measures would be taken to

prevent blackouts, etc., would rise by 800%.” Com-

ments of Goodwin Procter (submitted on behalf of En-

18

tergy Corp.), Comment ID 316bEFR.029.035, at 619.

Even temporary plant closures to allow retrofitting

would have a significant impact. Because of their

length, the anticipated closures would likely overlap

with the winter or summer peak electricity demand

seasons, threatening the reliability of the power grid.

NERC has recognized that mandating closed-cycle

cooling could adversely affect the nation’s power capac-

ity margins In its 2007 reliability report, NERC ex-

plained:

While plant specific outcomes will vary, retro-

fitting existing power plants with cooling tow-

ers can reduce the capacity of those plants,

which will exacerbate the supply concerns

identified in ... this assessment. In some

cases, retrofits may prove so costly that plants

are retired earlier than projected, with the con-

sequent loss of the plant’s entire capacity. Ata

time when additional electricity generating re-

sources are needed, the loss of existing gener-

ating capacity would undermine U.S. efforts to

meet the growing demand for electricity.

2007 NERC Assessment at 12. And, as noted above,

during the Phase II rulemaking the Department of En-

ergy “strongly” recommended that the EPA not re-

quire existing plants to be retrofitted to use closed-

cycle cooling. Comments of Department of Energy,

Comment ID 316bEFR.010.028, at 185.

Mandating the use of closed-cycle cooling would

likely also have significant adverse environmental ef-

fects. First, as explained above, at some plant sites a

closed-cycle retrofit would raise its own substantial en-

vironmental issues. In addition to possible adverse ef-

fects on the land and air surrounding the plant, retrofit-

19

ting could even adversely affect the water resources

protected by the Clean Water Act itself. Although a

closed-cycle cooling system at a nuclear plant does not

take in as much water day-to-day as a once-through

system, it actually consumes (that is, permanently re-

moves from the source water body) up to 80% more wa-

ter overall. See Water & Sustainability (Volume 3):

U.S. Water Consumption for Power Production—The

Next Half Century viii (Elec. Power Research Inst.

2002).

Second, where existing plants are forced to close or

have their output cut by retrofitting, new nuclear

plants cannot realistically replace the lost power over

the short or medium term. Designing a new nuclear

plant, obtaining necessary permits, and building the

plant takes years. New nuclear projects already in

early stages of development are not expected to begin

production until 2015 to 2020. Thus, as a practical mat-

ter, for at least several years any generating capacity

lost from existing nuclear plants would have to be re-

placed, if at all, by power generated using fossil fuels.

The EPA understood that requiring retrofitting

would result in increased reliance on fossil fuels. See,

e.g., 69 Fed. Reg. at 41,605. That, in turn, would in-

crease “the emission of sulfur dioxide, NO., particulate

matter, mercury and carbon dioxide.” /d. It is esti-

mated that using fossil fuels to replace the nuclear

power lost due to the retrofitting energy penalty alone

could add 37,000 tons of sulfur dioxide, 13,000 tons of

nitrogen oxiue, and 14 million metric tons of carbon di-

oxide to the nation’s atmosphere.'’ If capacity lost as a

' Carbon dioxide typically is measured in metric tons, which

are equivalent to approximately 2205 lbs.

20

result of nuclear plant closures were also replaced by

power from fossil-fuel plants, the increase in green-

house gas emissions would be even more severe.

* * *

Taking into account all of these concerns, the EPA

reasonably concluded that, for existing power plants,

the tremendous costs of retrofitting for closed-cycle

cooling far outweigh the incremental benefits it pro-

vides, as compared to the use of other EPA-approved

technologies, in reducing impingement and entrainment

at water intake structures. Its judgment rested both

on economic costs and on “non-water quality environ-

mental impacts.” 69 Fed. Reg. at 41,605.

If Congress had “weighed the various competing

economic and environmental considerations itself and

clearly mandated a different approach, then the court of

appeals would have been right to set aside the agency’s

judgment and enforce the congressional command. As

petitioners have demonstrated, however, nothing in the

language, structure, purpose, or previous judicial inter-

pretation of the Clean Water Act precludes the EPA

from taking economic and environmental costs into ac-

count, along with potential benefits, in determining

what constitutes, under particular circumstances, the

“best technology available for minimizing adverse envi-

ronmental impact” under Section 316(b). On the con-

trary, it is precisely in circumstances such as these, in-

volving the balancing of important social goals that in-

teract in complex ways, that Congress most typically

delegates to an agency the responsibility for particular-

ized implementation of statutory standards.

Because the Act, unsurprisingly, leaves room for

just the sort of complex agency judgment that the EPA

21

made here, the court of appeals erred in substituting its

own absolutist analysis for the more balanced approach

adopted by the EPA. That error threatens real, imme-

diate, and far-reaching harm to the nation’s power sup-

ply—and, ironically, to the very environmental values

that the court no doubt thought it was protecting. It

warrants review and correction by this Court.

CONCLUSION

The petitions for a writ of certiorari should be

granted.

Respectfully submitted.

ELLEN C. GINSBERG SETH P. WAXMAN

MICHAEL A. BAUSER Counsel of Record

NUCLEAR ENERGY EDWARD C. DUMONT

INSTITUTE BRIAN M. BOYNTON

1776 I Street, N.W. WILMER CUTLER PICKERING

Washington, D.C. 20006 HALE AND DORR LLP

(202) 739-8000 1875 Pennsylvania Ave., N.W.

Washington, D.C. 20006

(202) 663-6000

DECEMBER 2007