     08-3903-ag
     New York v. Nuclear Regulatory Commission


 1                       UNITED STATES COURT OF APPEALS
 2
 3                           FOR THE SECOND CIRCUIT
 4
 5                               August Term, 2009
 6
 7
 8   (Argued: October 23, 2009                   Decided: December 21, 2009)
 9
10   Docket Nos. 08-3903-ag (L), 08-4833-ag(con), 08-5571-ag(con)
11
12   - - - - - - - - - - - - - - - - - - - -x
13
14   THE STATE OF NEW YORK; RICHARD BLUMENTHAL,
15   Attorney General of Connecticut; and the
16   COMMONWEALTH OF MASSACHUSETTS,
17
18                     Petitioners,
19
20               - v.-
21
22   UNITED STATES NUCLEAR REGULATORY
23   COMMISSION; and the UNITED STATES OF
24   AMERICA ,
25
26                     Respondents,
27
28                     and
29
30   ENTERGY NUCLEAR OPERATIONS INC., et al.,
31
32                     Intervenor-Respondents.
33
34   - - - - - - - - - - - - - - - - - - - -x
35

36         Before:           JACOBS, Chief Judge, KEARSE, Circuit
37                           Judge, and GARDEPHE,* District Judge.


           *
            Paul G. Gardephe, of the United States District Court
     for the Southern District of New York, sitting by
     designation.
1
2        Petition for review of a decision of the Nuclear

3    Regulatory Commission denying rulemaking petitions filed by

4    Massachusetts and California.       As the Nuclear Regulatory

5    Commission has given due consideration to the relevant

6    studies concerning the rulemaking petitions, we must defer

7    to its expertise in determining the proper risk level

8    associated with the storage of nuclear material in spent

9    fuel pools, and therefore deny the petition to review the

10   Nuclear Regulatory Commission’s decision.

11                          JOHN J. SIPOS (Monica Wagner, Andrew
12                          M. Cuomo, Barbara D. Underwood,
13                          Benjamin N. Gutman, Katherine
14                          Kennedy, Janice A. Dean on the
15                          brief), State of New York, Albany,
16                          NY; Matthew Brock, Martha Coakley,
17                          Commonwealth of Massachusetts,
18                          Boston, MA; Richard Blumenthal,
19                          Robert D. Snook, State of
20                          Connecticut, Hartford, CT, for
21                          Petitioners.
22
23                          JAMES E. ADLER (Stephen G. Burns,
24                          John F. Cordes, Jr., Sean D. Croston
25                          on the brief), U.S. Nuclear
26                          Regulatory Commission, Washington,
27                          DC; John E. Arbab, John C. Cruden,
28                          Department of Justice, Washington,
29                          DC, for Respondents.
30
31                          David R. Lewis, Pillsbury Winthrop,
32                          Washington, DC; CATHERINE E. STETSON
33                          (Jessica L. Ellsworth on the brief),
34                          Hogan & Hartson LLP, Washington, DC;
35                          William C. Dennis, Entergy Nuclear

                                     2
 1                          Operations Inc., White Plains, NY,
 2                          for Intervenor-Respondents.
 3
 4                          Jerry Bonanno, Ellen C. Ginsberg,
 5                          Michael A. Bauser, Anne W.
 6                          Cottingham, Counsel for Nuclear
 7                          Energy Institute, Inc., Washington,
 8                          DC, for Amicus Curiae Nuclear Energy
 9                          Institute, Inc. in support of
10                          Federal Respondents, Intervenor-
11                          Respondents, and Affirmance.
12
13                          Edmund G. Brown, Jr., Ken Alex,
14                          Gordon Burns, Susan Durbin, Brian W.
15                          Hembacher, Attorneys for State of
16                          California, Los Angeles, CA, for
17                          Amicus Curiae State of California,
18                          ex rel. Edmund G. Brown, Jr.,
19                          Attorney General, in support of
20                          Petitioners.
21
22
23
24   PER CURIAM:
25
26       The States of New York and Connecticut and the

27   Commonwealth of Massachusetts (collectively the “States”)

28   petition for review of a decision of the Nuclear Regulatory

29   Commission (“NRC”) denying rulemaking petitions filed by

30   Massachusetts and California.       As the NRC has given due

31   consideration to the relevant studies, we must defer to

32   their expertise in determining the proper risk level

33   associated with the storage of nuclear material in spent

34   fuel pools, and therefore deny the petition for review.

35

                                     3
1                                    I

2        Two States filed rulemaking petitions (Massachusetts in

3    2006, and California in 2007) asking the NRC to reverse its

4    1996 Generic Environmental Impact Statement, which found

5    (among other things) that spent fuel pools at nuclear power

6    plants do not create a significant environmental impact

7    within the meaning of the National Environmental Policy Act,

8    42 U.S.C. § 4321 et seq.     The NRC consolidated and denied

9    the rulemaking petitions in a 2008 decision.     See 42 U.S.C.

10   § 2239(a)(1)(A).    United States Courts of Appeal have

11   jurisdiction to review such final orders of the NRC.      28

12   U.S.C. § 2342(4).    The States petitioning for review here

13   (New York, Connecticut, and Massachusetts) claim standing on

14   the ground that nuclear power plants are within or near

15   their borders and that an accident at one of these plants

16   could harm their citizens.

17       Under the National Environmental Policy Act (“NEPA”),

18   each federal agency must prepare an Environmental Impact

19   Statement (“EIS”) before taking a major action that

20   significantly affects the quality of the “human

21   environment.”   42 U.S.C. § 4332(2)(C).    The renewal of a

22   license for a nuclear power plant is a major action



                                     4
1    requiring an EIS under NRC regulations.     See 10 C.F.R. §

2    51.20.

3        The EIS required for license issuance and renewal at

4    nuclear power plants covers both generic and plant-specific

5    environmental impacts.    The NRC has decided that these two

6    kinds of impacts are to be treated separately.     Category I

7    impacts are those that: 1) are common to all nuclear power

8    plants; 2) can be assigned a uniform significance level of

9    small, moderate, or large (even if the impact is not

10   precisely the same at each plant); and 3) do not require

11   plant-specific kinds of mitigation.     Category II impacts

12   require site-by-site evaluation.     Since Category I impacts

13   are common to each license renewal, the NRC has produced a

14   Generic Environmental Impact Statement (“GEIS”) that applies

15   to these common issues.    Massachusetts v. United States, 522

16   F.3d 115, 120 (1st Cir. 2008).     The GEIS, combined with a

17   site-specific EIS, constitutes the complete EIS required by

18   NEPA for the major federal action of a plant’s license

19   renewal.   Id. (noting also that the GEIS was codified as a

20   final rule in Environmental Review for Renewal of Nuclear

21   Power Plant Operating Licenses, 61 Fed. Reg. 28,467 (June 5,

22   1996)).



                                    5
1        The NRC classifies on-site storage of spent fuel in

2    pools as a Category I issue that causes a small

3    environmental impact.   Massachusetts and California

4    contended that the information in their rulemaking petitions

5    showed a greater risk of fire from this source than

6    previously appreciated, and that therefore the environmental

7    impact should no longer be discounted as small; they further

8    contended that the risk should be evaluated plant-by-plant

9    (rather than be considered within Category I).     New York and

10   Connecticut supported these original petitions.     The NRC

11   considered both petitions together, and concluded that its

12   initial determination was correct.     After these petitions

13   were denied in August 2008, this petition for review

14   followed.

15

16                                 II

17       An agency decision to deny a rulemaking petition is

18   subject to judicial review; but that review is “extremely

19   limited and highly deferential.”     Massachusetts v. EPA, 549

20   U.S. 497, 527-28 (2007) (internal quotation marks omitted).

21   It “is to be overturned if it is arbitrary, capricious, an

22   abuse of discretion, or otherwise not in accordance with



                                   6
1    law”; but this standard is applied “at the high end of the

2    range of deference and an agency refusal is overturned only

3    in the rarest and most compelling of circumstances.”       EMR

4    Network v. FCC, 391 F.3d 269, 272-273 (D.C. Cir. 2004)

5    (internal quotation marks and citation omitted).    Such

6    compelling circumstances would typically involve “plain

7    errors of law” relating to the agency’s delegated authority.

8    Am. Horse Prot. Ass’n v. Lyng, 812 F.2d 1, 5 (D.C. Cir.

9    1987).

10       This standard has been said to be so high as to be

11   “akin to non-reviewability.”    Cellnet Comm’n, Inc. v. FCC,

12   965 F.2d 1106, 1111 (D.C. Cir. 1992).    To deny review of a

13   rulemaking petition, a court typically need do no more than

14   assure itself that an agency’s decision was “reasoned,”

15   meaning that it considered the relevant factors.    Lyng, 812

16   F.2d at 5 (internal quotation marks omitted).

17

18                                  III

19       The States’ primary arguments on appeal are that: 1)

20   new information submitted by Massachusetts and California in

21   their petitions (and New York in support of those petitions)

22   show that the risk of a spent fuel pool fire is not so


                                     7
1    remote that, when considered in light of the potentially

2    devastating effects, on-site storage in pools has a low

3    environmental impact; and 2) the NRC’s decision to deny the

4    rulemaking petitions was arbitrary and capricious because it

5    relied on plant-specific mitigation and security to support

6    a finding that spent fuel pools generically have low

7    environmental impacts.

8

9                                  A

10       The risks posed by keeping nuclear fuel on site in

11   spent fuel pools--including the risk of fire--have been

12   considered in studies prepared over the past four decades.

13   The studies relied on by the NRC all found that the risk of

14   a fire was low.   These studies (including those conducted

15   since September 2001) consider the risk of fire precipitated

16   by a terrorist attack, and classify that risk as low. 1


          1
            This opinion need not and does not reach the circuit
     split as to whether the NRC must take into account acts of
     terrorism when drafting an EIS about license renewal.
     Compare N.J. Dep’t of Envtl. Prot. v. U.S. NRC, 561 F.3d
     132, 139-40 (3d Cir. 2009) (holding that the NRC does not
     need to consider the risk of terrorism when preparing an
     EIS), with San Luis Obispo Mothers for Peace v. NRC, 449
     F.3d 1016, 1031 (9th Cir. 2006) (holding that the NRC does
     need to consider the risk of terrorism when preparing an
     EIS). We conclude that the NRC did sufficiently take into
     account acts of terrorism when deciding that the risk of

                                   8
1        The NRC had already analyzed most of the studies

2    submitted in connection with Massachusetts and California’s

3    petitions; the petitioners simply disagree with the NRC’s

4    interpretation of those studies.    Massachusetts and

5    California did submit one study that the NRC had not

6    previously considered; but the NRC--having examined this

7    study in considering whether to grant the petitions--

8    concluded that it was not as accurate as the studies on

9    which the NRC had previously relied.

10       These are technical and scientific studies.    “Courts

11   should be particularly reluctant to second-guess agency

12   choices involving scientific disputes that are in the

13   agency’s province of expertise.    Deference is desirable.”

14   Browning-Ferris Indus. of South Jersey, Inc. v. Muszynski,

15   899 F.2d 151, 160 (2d Cir. 1990), limited on other grounds

16   by Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83, 93

17   (1998).   “Particularly when we consider a purely factual

18   question within the area of competence of an administrative

19   agency created by Congress, and when resolution of that

20   question depends on ‘engineering and scientific’



     fire at a spent fuel pool was uniformly low, and therefore
     we need not decide whether the NRC could have avoided
     considering this issue.

                                   9
1    considerations, we recognize the relevant agency’s technical

2    expertise and experience, and defer to its analysis unless

3    it is without substantial basis in fact.”         Fed. Power Comm’n

4    v. Fla. Power & Light Co., 404 U.S. 453, 463 (1972).          The

5    relevant studies cited by the NRC in this case constitute a

6    sufficient “substantial basis in fact” for its conclusion

7    that the overall risk is low.        See Id.   We therefore

8    conclude the NRC’s decision was not an abuse of its

9    discretion.

10

11                                   B

12       The States on appeal contend that the risk of a spent

13   fuel pool fire must be a Category II rather than a Category

14   I risk, because the risk is affected by mitigation that

15   varies from plant to plant.     It is true that the NRC relies

16   in part upon mitigation at nuclear power plants--including

17   various coolant sprays and makeup water systems in case of

18   pool drainage--to conclude that the risk of an accidental or

19   terrorist-caused fire in the pools is uniformly low.

20   However, the NRC has mandated that these mitigation tactics

21   be implemented at all nuclear power plants.         The NRC

22   decision states that the agency has “approved license


                                     10
1    amendments and issued safety evaluations to incorporate

2    these [mitigation] strategies into the plant licensing bases

3    of all operating nuclear power plants in the United States.”

4    The NRC also requires heightened security at all plants as

5    part of its licensing process in the wake of the September

6    11, 2001 attacks.   See 10 C.F.R. § 50.54(hh); Power Reactor

7    Security Requirements, 74 Fed. Reg. 13,975 (Mar. 27, 2009).

8    An agency may take into account attempts to mitigate an

9    environmental impact when determining that an environmental

10   impact is small enough to not require an EIS, so long as the

11   effectiveness of the mitigation is demonstrated by

12   substantial evidence.   Nat’l Audubon Soc’y v. Hoffman, 132

13   F.3d 7, 17 (2d Cir. 1997).   The NRC relies on numerous

14   studies detailing the effectiveness of its required

15   mitigation measures; these studies constitute substantial

16   evidence.

17

18                             CONCLUSION

19       We conclude that the NRC’s decision denying the

20   rulemaking petitions was reasoned; it considered the

21   relevant studies, and it took account of the relevant

22   factors.    We therefore must conclude that the agency acted


                                    11
1   within its broad discretion.    We find the States’ other

2   arguments to be without merit.      The States’ petition to

3   review the NRC’s denial of the rulemaking petitions is

4   denied.




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