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Full Opinion
FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
CALIFORNIA WILDERNESS COALITION; 
NATURAL RESOURCES DEFENSE
COUNCIL; THE WILDERNESS SOCIETY,
INC.,
Petitioners,
and
DESERT PROTECTION SOCIETY;
CENTER FOR COMMUNITY
ACTION AND ENVIRONMENTAL
JUSTICE; BACKCOUNTRY AGAINST 
DUMPS; DESERT PROTECTIVE
COUNCIL; MORONGO BASIN
CONSERVATION ASSOCIATION;
ALLIANCE FOR RESPONSIBLE ENERGY
POLICY; DONNA CHARPIED;
LAURENCE CHARPIED; SAN
BERNARDINO VALLEY AUDUBON
SOCIETY,
Intervenors,

1897
1898 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
v. 
U.S. DEPARTMENT OF ENERGY,
Respondent,
ALLEGHENY ENERGY, INC.;
AMERICAN PUBLIC POWER
ASSOCIATION; EDISON ELECTRIC
INSTITUTE; MONOGAHELA POWER
COMPANY; NATIONAL RURAL
ELECTRIC COOPERATIVE
ASSOCIATION; PJM
INTERCONNECTION; PATH ALLEGHENY  No. 08-71074
no lower No.
TRANSMISSION COMPANY, LLC;
PATH WEST VIRGINIA TRANSMISSION
COMPANY, LLC; SAN DIEGO GAS &
ELECTRIC COMPANY; SOUTHERN
CALIFORNIA EDISON COMPANY; THE
POTOMAC EDISON COMPANY; TRANS-
ALLEGHENY INTERSTATE LINE
COMPANY; WEST PENN POWER
COMPANY,
Intervenors-Respondents-
Intervenors.

CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1899
COMMONWEALTH OF VIRGINIA; 
ROBERT F. MCDONNELL, Governor;
KENNETH T. CUCCINELLI, Attorney
General,
Petitioners,
and
DESERT PROTECTION SOCIETY;
CENTER FOR COMMUNITY
ACTION AND ENVIRONMENTAL
JUSTICE; BACKCOUNTRY AGAINST
DUMPS; DESERT PROTECTIVE
COUNCIL; MORONGO BASIN
CONSERVATION ASSOCIATION; 
ALLIANCE FOR RESPONSIBLE ENERGY
POLICY; DONNA CHARPIED;
LAURENCE CHARPIED; SAN
BERNARDINO VALLEY AUDUBON
SOCIETY,
Intervenors,
v.
U.S. DEPARTMENT OF ENERGY and
SAMUEL BODMAN, Secretary of
Energy,
Respondents,

1900 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
ALLEGHENY ENERGY, INC., DBA 
Allegheny Power; MONONGAHELA
POWER COMPANY, DBA Allegheny
Power; PATH ALLEGHENY
TRANSMISSION COMPANY, LLC;
PATH WEST VIRGINIA TRANSMISSION
COMPANY, LLC; POTOMAC EDISON
POWER COMPANY, DBA Allegheny
Power; TRANS-ALLEGHENY No. 08-71823
INTERSTATE LINE COMPANY; WEST
PENN POWER COMPANY, DBA  DOE Nos.
2007-OE-01
ALLEGHENY POWER, EDISON 2007-OE-02
ELECTRIC INSTITUTE; AMERICAN
PUBLIC POWER ASSOCIATION;
NATIONAL RURAL ELECTRIC
COOPERATIVE ASSOCIATION; SAN
DIEGO GAS & ELECTRIC COMPANY;
SOUTHERN CALIFORNIA EDISON
COMPANY,
Respondents-Intervenors.

CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1901
PENNSYLVANIA PUBLIC UTILITY 
COMMISSION (âPAPUCâ),
Petitioner,
and
DESERT PROTECTION SOCIETY;
CENTER FOR COMMUNITY
ACTION AND ENVIRONMENTAL
JUSTICE; BACKCOUNTRY AGAINST
DUMPS; DESERT PROTECTIVE
COUNCIL; MORONGO BASIN No. 08-71829
CONSERVATION ASSOCIATION;  DOE No.
ALLIANCE FOR RESPONSIBLE ENERGY 2007-OE-01
POLICY; DONNA CHARPIED;
LAURENCE CHARPIED; SAN
BERNARDINO VALLEY AUDUBON
SOCIETY,
Intervenors,
v.
U.S. DEPARTMENT OF ENERGY and
SAMUEL W. BODMAN,
Respondents.

1902 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
STATE OF NEW YORK, 
Petitioner,
and
DESERT PROTECTION SOCIETY;
CENTER FOR COMMUNITY
ACTION AND ENVIRONMENTAL
JUSTICE; BACKCOUNTRY AGAINST
DUMPS; DESERT PROTECTIVE
COUNCIL; MORONGO BASIN No. 08-71831
CONSERVATION ASSOCIATION;
ALLIANCE FOR RESPONSIBLE ENERGY  DOE No.
POLICY; DONNA CHARPIED; 2007-OE-02
LAURENCE CHARPIED; SAN
BERNARDINO VALLEY AUDUBON
SOCIETY,
Intervenors,
v.
U.S. DEPARTMENT OF ENERGY and
SAMUEL W. BODMAN,
Respondents.

CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1903
PIEDMONT ENVIRONMENTAL COUNCIL; 
NATIONAL TRUST FOR HISTORIC
PRESERVATION; NATIONAL PARKS
CONSERVATION ASSOCIATION; CIVIL
WAR PRESERVATION TRUST;
PENNSYLVANIA LAND TRUST
ASSOCIATION; THE COUNTY OF
FAUQUIER, VIRGINIA,
Petitioners,
and
DESERT PROTECTION SOCIETY;
CENTER FOR COMMUNITY
ACTION AND ENVIRONMENTAL
JUSTICE; BACKCOUNTRY AGAINST  No. 08-71845
no lower No.
DUMPS; DESERT PROTECTIVE
COUNCIL; MORONGO BASIN
CONSERVATION ASSOCIATION;
ALLIANCE FOR RESPONSIBLE ENERGY
POLICY; DONNA CHARPIED;
LAURENCE CHARPIED; SAN
BERNARDINO VALLEY AUDUBON
SOCIETY,
Intervenors,
v.
U.S. DEPARTMENT OF ENERGY and
SAMUEL W. BODMAN,
Respondents.

1904 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
COMMONWEALTH OF PENNSYLVANIA 
and DEPARTMENT OF
ENVIRONMENTAL PROTECTION,
Petitioners,
and
DESERT PROTECTION SOCIETY;
CENTER FOR COMMUNITY
ACTION AND ENVIRONMENTAL
JUSTICE; BACKCOUNTRY AGAINST
DUMPS; DESERT PROTECTIVE No. 08-71870
COUNCIL; MORONGO BASIN  DOE No.
CONSERVATION ASSOCIATION; 2007-OE-01
ALLIANCE FOR RESPONSIBLE ENERGY
POLICY; DONNA CHARPIED;
LAURENCE CHARPIED; SAN
BERNARDINO VALLEY AUDUBON
SOCIETY,
Intervenors,
v.
U.S. DEPARTMENT OF ENERGY,
Respondent.

CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1905
PUBLIC UTILITIES 
COMMISSION OF THE STATE OF
CALIFORNIA,
Petitioner,
PUBLIC SERVICE COMMISSION OF THE
STATE OF NEW YORK,
Petitioner-Intervenor,
and
DESERT PROTECTION SOCIETY;
CENTER FOR COMMUNITY
ACTION AND ENVIRONMENTAL
JUSTICE; BACKCOUNTRY AGAINST
DUMPS; DESERT PROTECTIVE
COUNCIL; MORONGO BASIN
CONSERVATION ASSOCIATION;  No. 08-71872
no lower No.
ALLIANCE FOR RESPONSIBLE ENERGY
POLICY; DONNA CHARPIED;
LAURENCE CHARPIED; SAN
BERNARDINO VALLEY AUDUBON
SOCIETY,
Intervenors,
v.
U.S. DEPARTMENT OF ENERGY and
SAMUEL W. BODMAN,
Respondents,
SOUTHERN CALIFORNIA EDISON
COMPANY,
Respondent-Intervenor.

1906 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
IMPERIAL IRRIGATION DISTRICT, 
Petitioner,
and
DESERT PROTECTION SOCIETY;
CENTER FOR COMMUNITY
ACTION AND ENVIRONMENTAL
JUSTICE; BACKCOUNTRY AGAINST
DUMPS; DESERT PROTECTIVE
COUNCIL; MORONGO BASIN
CONSERVATION ASSOCIATION;
ALLIANCE FOR RESPONSIBLE ENERGY No. 08-71884
POLICY; DONNA CHARPIED;
LAURENCE CHARPIED; SAN
 DOE Nos.
2007-OE-01
BERNARDINO VALLEY AUDUBON 2007-OE-02
SOCIETY,
Intervenors,
v.
U.S. DEPARTMENT OF ENERGY and
SAMUEL W. BODMAN,
Respondents,
and
SOUTHERN CALIFORNIA EDISON
COMPANY.

CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1907
ARIZONA CORPORATION COMMISSION, 
Petitioner,
and
PUBLIC SERVICE COMMISSION OF
THE STATE OF NEW YORK,
DESERT PROTECTION SOCIETY;
CENTER FOR COMMUNITY
ACTION AND ENVIRONMENTAL
JUSTICE; BACKCOUNTRY AGAINST
DUMPS; DESERT PROTECTIVE
COUNCIL; MORONGO BASIN
No. 08-71908
CONSERVATION ASSOCIATION;
ALLIANCE FOR RESPONSIBLE ENERGY
POLICY; DONNA CHARPIED;
 DOE Nos.
2007-OE-02
LAURENCE CHARPIED; SAN 2007-OE-01
BERNARDINO VALLEY AUDUBON
SOCIETY,
Intervenors,
v.
U.S. DEPARTMENT OF ENERGY and
SAMUEL W. BODMAN,
Respondents,
and
SOUTHERN CALIFORNIA EDISON
COMPANY.

1908 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
COMMUNITIES AGAINST REGIONAL 
INTERCONNECT,
Petitioner, No. 08-72423
v.  DOE No.
73FR12959
U.S. DEPARTMENT OF ENERGY,
Respondent.

PEOPLE OF THE STATE OF NEW YORK 
and PUBLIC SERVICE COMMISSION OF
THE STATE OF NEW YORK,
Petitioners, No. 08-72644
v.  DOE No.
U.S. DEPARTMENT OF ENERGY and 2007-OE-01
SAMUEL BODMAN, Secretary of
Energy,
Respondents.

CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1909
NEW JERSEY BOARD OF PUBLIC 
UTILITIES,
Petitioner,
v.
U.S. DEPARTMENT OF ENERGY,
Respondent,
SOUTHERN CALIFORNIA EDISON
COMPANY; EDISON ELECTRIC
INSTITUTE; AMERICAN PUBLIC POWER
ASSOCIATION; NATIONAL RURAL No. 08-72717
ELECTRIC COOPERATIVE
ASSOCIATION; MONONGAHELA POWER  DOE No.
COMPANY; THE POTOMAC EDISON 73FR12959
COMPANY; WEST PENN POWER
COMPANY; TRANS-ALLEGHENY
INTERSTATE LINE COMPANY;
ALLEGHENY ENERGY, INC.; PATH
ALLEGHENY TRANSMISSION
COMPANY, LLC; PATH WEST
VIRGINIA TRANSMISSION COMPANY,
LLC; SAN DIEGO GAS & ELECTRIC
COMPANY,
Respondents-Intervenors.

TOLL BROTHERS, INC.,  No. 08-72835
Petitioner,
v.  DOE No.
2007-OE-01
U.S. DEPARTMENT OF ENERGY,
OPINION
Respondent.

1910 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
On Petition for Review of an Order of the
United States Department of Energy
Argued and Submitted
June 8, 2010âSeattle, Washington
Filed February 1, 2011
Before: William C. Canby, Jr., Consuelo M. Callahan and
Sandra S. Ikuta, Circuit Judges.
Opinion by Judge Callahan;
Dissent by Judge Ikuta
1914 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
COUNSEL
Petitioners The Wilderness Society, Natural Resources
Defense Council, California Wilderness Coalition, Piedmont
Environmental Council, National Trust for Historic Preserva-
tion, National Parks Conservation Association, Civil War
Preservation Trust, Pennsylvania Land Trust Association,
Fauquier County, Virginia, and Toll Brothers Inc., and Inter-
venors Desert Protection Society, et al., represented by:
Anjali I. Jaiswal and Johanna H. Wald, Natural Resources
Defense Council, San Francisco, California.
William A. Anderson II, Williams Mullen, Washington, D.C.
Stephen C. Volker and Joshua Harris, Oakland, California.
James B. Dougherty (argued), Washington, D.C.
Caleb A. Jaffe, Southern Environmental Law Center, Char-
lottesville, Virginia.
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1915
Andrea C. Ferster, Washington, D.C.
Elizabeth S. Merritt, Deputy General Counsel, National Trust
for Historic Preservation, Washington, D.C.
Petitioners Pennsylvania Public Utility Commission, Gover-
nor Edward G. Rendell and the Pennsylvania Department of
Environmental Protection, New Jersey Board of Public Utili-
ties, State of New York, Public Service Commission of the
State of New York, and Commonwealth of Virginia, repre-
sented by:
James P. Melia and Steven K. Bainbridge, Pennsylvania Pub-
lic Utility Commission, Harrisburg, Pennsylvania.
Maureen Riley Matsen, C. Meade Browder and D. Mathias
Roussy, Office of the Attorney General of Virginia, Rich-
mond, Virginia.
Andrew M. Cuomo, Attorney General of the State of New
York and Maureen F. Leary (argued), Office of the Attorney
General Environmental Protection Bureau, Albany, New
York.
Scott R. Perry, Commonwealth of Pennsylvania, Department
of Environmental Protection, Harrisburg, Pennsylvania.
Anne Milgram, Attorney General of New Jersey and Kenneth
Sheehan, Deputy Attorney General, New Jersey Department
of Law and Public Safety, Newark, New Jersey.
Jonathan Feinberg, Solicitor, Public Services Commission of
the State of New York, Albany, New York.
Petitioners Pennsylvania Public Utility Commission, Gover-
nor Edward G. Rendell and the Pennsylvania Department of
Environmental Protection, New Jersey Board of Public Utili-
ties, State of New York, Public Service Commission of the
1916 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
State of New York, Commonwealth of Virginia, Public Utili-
ties Commission of the State of California, Arizona Corpora-
tion Commission, represented by:
Jonathan D. Feinberg, State of New York Department of Pub-
lic Service, Office of General Counsel, Albany, New York.
James P. Melia, John Levine and Steven Bainbridge, Pennsyl-
vania Public Utility Commission, Harrisburg, Pennsylvania.
Janet Wagner and Nancy Scott, Arizona Corporation Com-
mission, Legal Division, Phoenix, Arizona.
Anne Milgram, New Jersey State Attorney General and Ken-
neth J. Sheehan, Deputy Attorney General, Department of
Law & Public Safety, Newark, New Jersey.
Andrew M. Cuomo, New York State Attorney General, Mau-
reen F. Leary (argued), Assistant Attorney General and
Denise A. Hartman, Assistant Solicitor General, Albany, New
York.
Maureen Riley Matsen, Mathia Roussy, and C. Meade
Browder, Office of the Attorney General, Richmond, Vir-
ginia.
Scott Perry, Pennsylvania Department of Environmental Pro-
tection, Harrisburg, Pennsylvania.
Laurence G. Chaset (argued), California Public Utilities Com-
mission Legal Division, San Francisco, California.
Petitioners Public Utilities Commission of the State of Cali-
fornia, Imperial Irrigation District, Arizona Corporation Com-
mission, represented by:
Harvey Y. Morris and Laurence G. Chaset (argued), Legal
Division, California Public Utilities, San Francisco, Califor-
nia.
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1917
Deborah A. Swanstrom and Erika D. Benson, Patton Boggs,
LLP, Washington, D.C.
Stephen J Keene, Imperial Irrigation District, Imperial, Cali-
fornia.
Janet Wagner and Nancy Scott, Arizona Corporation Com-
mission, Phoenix, Arizona.
Respondents United States Department of Energy, et al., rep-
resented by:
John C. Truden, Acting Assistant Attorney General, Environ-
mental & Natural Resources Division, Washington, D.C.
Micahel F. Hertz, Acting Assistant Attorney General, Civil
Division, Washington, D.C.
Stacey W. Person and John L. Smeltzer (argued), Department
of Justice, Washington, D.C.
Mark B. Stern and Dana J. Martin (argued), Department of
Justice, Washington, D.C.
Bettina Mumme and Lot Cooke, Department of Energy,
Office of General Counsel, Washington, D.C.
Respondents-Intervenors Allegheny Energy, Inc., American
Public Power Association, Edison Electric Institute, Monon-
gahela Power Company, National Rural Electronic Coopera-
tive Association, PJM Interconnection, LLC, Path Allegheny
Transmission Company, LLC, Path West Virginia Transmis-
sion Company, LLC, San Diego Gas & Electric Company,
Southern California Edison Company, The Potomac Edison
Company, Trans-Allegheny Interstate Line Company, and
West Penn Power Company, represented by:
Randall B. Palmer, Allegheny Energy, Inc., Greensburg,
Pennsylvania.
1918 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
Sharon Lisa Cohen, E. Gregory Barnes and Jonathan J. New-
lander, Sempra Energy Law Department, San Diego, Califor-
nia.
Alice Elizabeth Loughran, Steptoe & Johnson, LLP, Wash-
ington, D.C.
Barry S. Spector and Michael J. Thompson, Wright & Talis-
man, P.C., Washington, D.C.
Alden L. Atkins and David E. Hawkins, Vinson and Elkins,
LLP, Washington, D.C.
Anna Jennifer Valdberg and Robert Kang, Southern Califor-
nia Edison Company Legal Division, Rosemead, California.
OPINION
CALLAHAN, Circuit Judge:
These thirteen petitions for review challenge the Depart-
ment of Energyâs (âDOEâ) implementation of the Energy Pol-
icy Act of 2005 (âEPActâ), which added a new section 216
to the Federal Power Act (âFPAâ), codified as 16 U.S.C.
§ 824p (sometimes referred to as ⧠216â). Petitioners offer
three distinct challenges to DOEâs actions: (1) DOE failed to
consult with the affected States in undertaking the Congestion
Study as required by § 824p(a)(1); (2) DOE failed to properly
consider the potential environmental consequences of its des-
ignation of national interest electric transmission corridors
(âNIETCsâ); and (3) DOEâs actual designations of the Mid-
Atlantic Area National Corridor and the Southwest Area
National Corridor are arbitrary, capricious, and not supported
by the evidence. We determine that DOE failed to properly
consult with the affected States in conducting the Congestion
Study and failed to undertake any environmental study for its
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1919
NIETC Designation as required by the National Environmen-
tal Protection Act (âNEPAâ), 42 U.S.C. § 4332(C). We also
determine that these failings were not harmless errors.
Accordingly, we vacate the Congestion Study and NIETC
designation and remand the cases to the DOE for further pro-
ceedings. Because we vacate the NIETC designation, we do
not consider the merits of petitionersâ challenges to the spe-
cific national corridors other than as necessary to determine
that DOEâs failures to consult and to undertake an environ-
mental study were not harmless errors.
I. BACKGROUND
A. The Critical Statute, 16 U.S.C. § 824
In response to a number of electrical brown-outs and black-
outs, Congress passed the EPAct, Pub. L. No. 109-85, 119
Stat. 594 (2005). The EPAct added a new section 216 to the
FPA. The first provisions of the section read:
(a) Designation of national interest electric transmis-
sion corridors
(1) Not later than 1 year after August 8, 2005 and
every 3 years thereafter, the Secretary of Energy
(referred to in this section as the âSecretaryâ), in
consultation with affected States, shall conduct a
study of electric transmission congestion.
(2) After considering alternatives and recommenda-
tions from interested parties (including an opportu-
nity for comment from affected States), the
Secretary shall issue a report, based on the study,
which may designate any geographic area experi-
encing electric energy transmission capacity con-
straints or congestion that adversely affects
consumers as a national interest electric transmis-
sion corridor.
1920 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
16 U.S.C. § 824p (emphasis added).
The designation of an area as a ânational interest electric
transmission corridorâ (variously referred to as a âNational
Corridor,â âNIET Corridorâ or âNIETCâ) makes available a
fast-track approval process to utilities seeking permits for
transmission lines within the corridor. See 16 U.S.C.
§§ 824p(b)-(h). In particular, the Federal Energy Regulatory
Commission (âFERCâ) is empowered to grant a permit for a
transmission line within the corridor if, among other condi-
tions, a state agency fails to approve the permit application
within a year. 16 U.S.C. § 824p(b).1 In addition, the EPAct,
in providing for the issuance of a permit, gives the applicant
the right to acquire rights-of-way through eminent domain. 16
U.S.C. § 824p(e).
Moreover, 16 U.S.C. § 824p(j)(1) states, â[E]xcept as spe-
cifically provided, nothing in this section affects any require-
1
Section 824p(b) reads in part:
(b) Construction permit
Except as provided in subsection (I) of this section, the Commis-
sion may, after notice and an opportunity for hearing, issue one
or more permits for the construction or modification of electric
transmission facilities in a national interest electric transmission
corridor designated by the Secretary under subsection (a) of this
section if the Commission finds thatâ
...
(1)(C) a State commission or other entity that has authority to
approve the siting of the facilities hasâ
(I) withheld approval for more than 1 year after the filing of an
application seeking approval pursuant to applicable law or 1 year
after the designation of the relevant national interest electric
transmission corridor, whichever is later; or
(ii) conditioned its approval in such a manner that the proposed
construction or modification will not significantly reduce trans-
mission congestion in interstate commerce or is not economically
feasible . . .
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1921
ment of an environmental law of the United States, including
the National Environmental Policy Act of 1969 (42 U.S.C.
§§ 4321 et seq.).â
B. The Congestion Study
Following the enactment of § 216, DOE gave presentations
at a number of conferences regarding the new law. Its first
request for comments or assistance from others was a Febru-
ary 2, 2006 âNotice of inquiry requesting comment and pro-
viding notice of a technical conferenceâ (the âFebruary 2
Noticeâ). 71 Fed. Reg. 5660-64 (Feb. 2, 2006). The notice
sought âcomment and information from the public concerning
its plans for an electricity transmission congestion study and
possible designation of [NIET Corridors].â2 Id. at 5660. The
February 2 Notice stated that work on the Congestion Study
was âwell underwayâ and that DOE intended to publish the
study by August 8, 2006. Id. at 5661. The Notice also stated
that a technical conference would be held in Chicago, Illinois,
on March 29, 2006. Id. at 5660.
The technical conference was held in March 2006, and a
2
The February 2 Notice set forth eight draft criteria for identifying
NIET Corridors: (1) âaction is needed to maintain high reliabilityâ; (2)
âaction is needed to achieve economic benefits for consumersâ; (3) âac-
tions are needed to ease electricity supply limitations in end markets
served by a corridor, and diversify sourcesâ; (4) âtargeted actions in the
area would enhance the energy independence of the United Statesâ; (5)
âtargeted actions in the area would further national energy policyâ; (6)
âtargeted actions in the area are needed to enhance the reliability of elec-
tricity supplies to critical loads and facilities and reduce vulnerability of
such critical loads or the electricity infrastructure to natural disasters or
malicious actsâ; (7) âthe areaâs projected need (or needs) is not unduly
contingent on uncertainties associated with analytic assumptions, e.g.
assumptions about future prices for generation fuels, demand growth in
load centers, the location of new generation facilities, or the cost of new
generational technologiesâ; and (8) âthe alternative means of mitigating
the need in question have been addressed sufficiently.â 71 Fed. Reg. at
5662.
1922 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
number of State entities attended and some participated in
various panels. A separate invitation-only meeting was held in
May 2006 to âreview and evaluate the congestion analyses
performed by DOEâs contractors,â but no states were invited.3
DOE asserts that it reached out to affected States through
meetings with the National Association of Regulatory Utility
Commissioners (âNARUCâ) and through other meetings and
correspondence with individual State entities.
DOE issued its Congestion Study in August 2006. The
notice in the Federal Register requested comments âon the
study and on the possible designation of national interest elec-
tric transmission corridors.â 71 Fed. Reg. 45,047 (Aug. 8,
2006). DOE received over 400 comments on the Congestion
Study. On May 7, 2007, DOE responded to the comments and
sought additional comments on âdraft National Corridor des-
ignations for the two Critical Congestion Areas identified in
the Congestion Study: the draft Mid-Atlantic Area National
Corridor; and the draft Southwest Area National Corridor.â 72
Fed. Reg. 25,840 (May 7, 2007) (the âMay 7 Noticeâ).
A major objection set forth in the comments was the asser-
tion that DOE had failed to consult with affected States. Id.
at 25,850. DOE responded that it was âcommitted to fulfilling
its obligation to consult with Statesâ but asserted that âthere
are practical difficulties in conducting the level of consulta-
tion that some may prefer in the context of a study of this
magnitude,â and that it âis difficult to know which States are
3
According to DOE, the invitation-only meeting had three purposes:
(1) to learn whether the results of the congestion modeling track
actual and expected grid conditions with some fidelity; (2) to
learn whether the congestion analysis findings and other grid
knowledge suggest that there are any obvious project or corridor
priorities for new grid expansion; (3) to learn whether DOEâs
draft NIETC criteria (other than congestion) suggest additional
expansion needs.
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1923
âaffectedâ until the conclusions of the congestion study are
known.â Id. DOE claimed to have met its obligation because
it: (1) had âprovided States with numerous opportunities for
input and [ ] held meetings with officials representing individ-
ual States and groups of States;â (2) had made the Congestion
Study available on August 8, 2006; and (3) had, âin addition
to [having made] the draft National Corridor designations
described in this notice available for comment, . . . simulta-
neously contact[ed] the Governors of each State in which the
draft National Corridors would be located to arrange consulta-
tion meetings.â Id.
The May 7 Notice also described a number of other com-
ments that DOE received that may be divided into four
groups. A first group of comments are objections to DOEâs
interpretation of the scope of its authority to designate
National Corridors, its definitions of âcongestionâ and âcon-
straint,â and the need for the Congestion Study to accommo-
date state laws and policies on renewable portfolio standards.
Id. at 25,842. In responding to, and rejecting these objections,
DOE stressed its discretion under § 216. Id. at 25,843. It
noted that âthere is no generally accepted understanding of
what constitutes âconstraints or congestion that adversely
affects consumersâ â and defended the definition adopted in
the Congestion Study. Id. at 25,843-45.
A second group of comments concerned the relationship
between regional planning processes and the designation of
national corridors. Id. at 25,846. For example, NARUC
argued that DOE should grant deference to the results of ade-
quate regional planning processes, and the Public Utilities
Commission of the State of California (âCPUCâ) argued that
âdesignation is unwarranted unless there is evidence that State
and regional processes are not addressing the problem in a
timely manner.â Id. DOE indicated that it âsupports and
encourages regional planning effortsâ but nonetheless had
decided not to defer to regional planning processes. Id. at
25,846-47.
1924 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
A third group raised comments concerning the drawing of
boundaries. Some comments advocated the use of specific
transmission projects to define national corridor boundaries,
others suggested that boundaries should be tailored to aid in
the construction of specific viable transmission projects, and
ânumerous commentersâ argued that DOE âshould draw
National Corridor boundaries to exclude parks and other envi-
ronmentally protected areas.â Id. at 25,847. In response, DOE
first noted that the âstatute provided little direction on how the
Department should draw the boundaries of a National Corri-
dor.â Id. at 25,848. DOE observed that the selection of source
areas âwill necessarily involve discretion and is not suited to
a formulaic approach.â Id. In declining to make any changes
in response to the comments, DOE noted:
The Department acknowledges that determining the
exact perimeters for a National Corridor under a
source-and-sink approach is more an art than a sci-
ence, and there will rarely be a dispositive reason to
draw a boundary in one place as opposed to some
number of miles to the right or the left. The drawing
of the boundary is ultimately a judgment the Secre-
tary must make based on all relevant considerations,
including the considerations identified in FPA sec-
tion 216(a)(4), as appropriate, and available, relevant
data. There is no single boundary line that can be
determined based solely upon analysis of the data.
Id. at 25,849.
The fourth group of comments asserted that DOE was
required to prepare a Programmatic Environmental Impact
Statement pursuant to NEPA before designating any National
Corridor. Id. at 25,850. DOE responded that although NEPA
requires environmental impact statements for major Federal
actions, â[t]he designation of a National Corridor . . . does not
significantly affect the quality of the human environment,â
and accordingly a âNational Corridor designation is not a
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1925
âproposal for a major Federal action significantly affecting the
quality of the human environmentâ that falls within the pur-
view of NEPA.â4 Id. at 25,851.
C. The Designation Order
On October 5, 2007, DOE issued its order formally desig-
nating two NIETCs, the Mid-Atlantic Area National Interest
Electric Transmission Corridor (the âMid-Atlantic Corridorâ)
and the Southwest Area National Interest Electric Transmis-
sion Corridor (the âSouthwest Corridorâ). 72 Fed. Reg.
56,992 (Oct. 5, 2007). DOE explained its perspective and its
rejection of all comments recommending different approaches.5
DOE reiterated that no environmental study was necessary,
explaining:
NEPA review is designed to examine the foresee-
able, measurable, and predictable consequences of a
proposed Federal action; it is not intended to forecast
hypothetical or unknowable proposals or results.
National Corridor designations have no environmen-
4
DOE reasoned as follows:
A National Corridor designation is not a determination that trans-
mission must, or even should, be built; it is not a proposal to
build a transmission facility and it does not direct anyone to make
a proposal. Nor does the Departmentâs designation of a National
Corridor result in or plan for any ground-breaking environmental
impacts. Nor does National Corridor designation irrevocably
commit any resources to any activity having foreseeable environ-
mental impacts. Designation of a National Corridor does not con-
trol FERCâs substantive decision on the merits as to whether to
grant or deny a permit application, specifically where any facili-
ties covered by a permit should be located, or what conditions
should be placed on a permit.
72 Fed. Reg. 25,851.
5
The parties note a single change in coverage; Clark County, Nevada,
was removed from the Southwest Corridor. See 72 Fed. Reg. at 25,923;
72 Fed. Reg. 57,017-18.
1926 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
tal impact. They are only designations of geographic
areas in which DOE has identified electric conges-
tion or constraint problems.
72 Fed. Reg. at 57,022.
Finally, in March 2008, DOE issued an order denying
rehearing of its Designation Order. 73 Fed. Reg. 12,959 (Mar.
11, 2008). DOE reiterated its determination that no environ-
mental study was needed and further noted that âit would be
highly speculative for the Department to make assumptions
about whether, when, or where FERC might permit transmis-
sion facilities.â Id. at 12,969.
D. The Judicial Proceedings
The first petition to review DOEâs actions was filed by The
Wilderness Society, et al. in this court on March 14, 2008.
Twelve other petitions for review were timely filed in other
Circuits. Pursuant to stipulations, all thirteen petitions were
consolidated in the Ninth Circuit and are before this panel for
consideration.
II. THE REQUIREMENT FOR CONSULTATION
A. Standards of Review
In reviewing DOEâs actions, we are guided by the standard
of review established by Chevron USA, Inc. v. Natural
Resources Defense Council, Inc., 467 U.S. 837 (1984), and its
progeny. The Courtâs seminal statement is:
When a court reviews an agencyâs construction of
the statute which it administers, it is confronted with
two questions. First, always, is the question whether
Congress has directly spoken to the precise question
at issue. If the intent of Congress is clear, that is the
end of the matter; for the court, as well as the
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1927
agency, must give effect to the unambiguously
expressed intent of Congress. If, however, the court
determines Congress has not directly addressed the
precise question at issue, the court does not simply
impose its own construction on the statute, as would
be necessary in the absence of an administrative
interpretation. Rather, if the statute is silent or
ambiguous with respect to the specific issue, the
question for the court is whether the agencyâs answer
is based on a permissible construction of the statute.
Id. at 842-43 (footnotes omitted). The Court, however, also
noted that â[t]he judiciary is the final authority on issues of
statutory construction and must reject administrative construc-
tions which are contrary to clear congressional intent,â and
that â[i]f a court, employing traditional tools of statutory con-
struction, ascertains that Congress had an intention on the pre-
cise question at issue, that intention is the law and must be
given effect.â Id. at 843 n.9.
Both prongs of the Chevron standard are in play in this
case. On the one hand, Congress clearly directed DOE to
engage in âconsultation with affected States.â On the other
hand, it did not explicitly define âconsultation.â DOE urges
that accordingly, Congressâs intent is not clear and that the
highly deferential standard of review for agency action under
the Administrative Procedure Act applies. See 5 U.S.C. § 706.6
6
Section 706 reads:
To the extent necessary to decision and when presented, the
reviewing court shall decide all relevant questions of law, inter-
pret constitutional and statutory provisions, and determine the
meaning or applicability of the terms of an agency action. The
reviewing court shallâ
(1) compel agency action unlawfully withheld or unreasonably
delayed; and
(2) hold unlawful and set aside agency action, findings, and con-
clusions found to beâ
1928 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
We have recognized that this standard is âhighly deferen-
tial, presuming the agency action to be validâ and that we may
not substitute our judgment for that of the agency. Nw.
Ecosystem Alliance v. U.S. Fish and Wildife Serv., 475 F.3d
1136, 1140 (9th Cir. 2007). We therefore will âaffirm[ ] the
agency action if a reasonable basis exists for its decision.â Id.
âOur task is simply to ensure that the agency considered the
relevant factors and articulated a rational connection between
the facts found and the choices made.â Id. (internal quotation
marks and citation omitted).
B. Congressional Intent
[1] Congress could hardly have been more explicit in
directing DOE to consult with âaffected States.â Section
824p(a)(1) specifically directs DOE to conduct a study of
electric transmission congestion âin consultation with affected
States.â Furthermore, § 824p(a)(2) directs DOE to issue a
report which may designate National Interest corridors,
â[a]fter considering alternatives and recommendations from
(A) arbitrary, capricious, an abuse of discretion, or otherwise not
in accordance with law;
(B) contrary to constitutional right, power, privilege, or immu-
nity;
(C) in excess of statutory jurisdiction, authority, or limitations, or
short of statutory right;
(D) without observance of procedure required by law;
(E) unsupported by substantial evidence in a case subject to sec-
tions 556 and 557 of this title or otherwise reviewed on the record
of an agency hearing provided by statute; or
(F) unwarranted by the facts to the extent that the facts are sub-
ject to trial de novo by the reviewing court.
In making the foregoing determinations, the court shall review the
whole record or those parts of it cited by a party, and due account shall
be taken of the rule of prejudicial error.
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1929
interested parties (including an opportunity for comment from
affected States).â
âOur first step in interpreting a statute is to determine
whether the language at issue has a plain and unambiguous
meaning . . . .â Robinson v. Shell Oil Co., 519 U.S. 337, 340
(1993). This is âdetermined by reference to the language
itself, the specific context in which that language is used, and
the broader context of the statute as a whole.â Id. at 341. See
also United States v. Morton, 467 U.S. 822, 828 (1984) (âWe
do not, however, construe statutory phrases in isolation; we
read statutes as a whole.â).
[2] Here, § 824âs direction to the DOE to undertake the
Consultation Study âin consultation with affected Statesâ in
context clearly means that DOE should have greater interac-
tion with the States in preparing the Congestion Study than it
need have when preparing a NIETC report, when it need only
provide âan opportunity for comment from affected States.â
Indeed, DOE does not really deny that it was required to
âconsultâ with âaffected States.â See 72 Fed. Reg. at 25,838
(stating that âFPA section 216(a)(1) requires the Secretary to
consult with âaffected Statesâ â); 72 Fed. Reg. at 56,993 (stat-
ing that âFPA section 216(a)(1) states that the Department
shall conduct the congestion study in consultation with
affected Statesâ).
[3] Accordingly, the issue is whether DOE, while under-
taking the Congestion Study, consulted with the affected
States as mandated by Congress. This inquiry requires that we
review DOEâs efforts to involve the affected States in the
preparation of the Congestion Study and then evaluate
whether those efforts amount, as DOE contends, to consulta-
tion. Finally, if we determine that DOEâs actions did not
amount to consultation, we must determine whether any such
shortcoming constitutes harmless error.
1930 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
III. DOE FAILED TO CONSULT
A. DOEâs interaction with the âaffected Statesâ
The record shows that DOE sought the affected Statesâ
input in three ways but also excluded them from participating
in several significant respects. First, on February 2, 2006,
DOE invited the public, including the âaffected States,â to
provide comments for its ongoing Congestion Study. Second,
DOE informed the affected States of a technical conference
that would be held in Chicago in March 2006. Third, when it
issued the Congestion Study in August 2006, it invited com-
ments on the designation of NIETCs. 71 Fed. Reg. at 45,047.
On the other hand, the record shows that DOE did not
extend an invitation to potentially affected States to attend an
âinvitation-onlyâ workshop on the Congestion Study that was
held in May 2006. Also, DOE did not disclose to the affected
States the congestion modeling data it used to conduct the
Congestion Study. Furthermore, DOE never extended any
invitation to the affected States or their Governors to âcon-
sultâ on the preparation of the Congestion Study.7
DOE also cites its meetings with NARUC and meetings
and conferences with other State entities as evidence that it
met its obligation to consult. There is little, however, to sug-
gest that these events provided meaningful opportunities for
dialogues between the States and DOE. NARUC, of course,
is not a state or even a state entity. Rather, it is a âquasi-
governmental organization that includes representatives of all
fifty states . . . .â NARUC v. FCC, 746 F.2d 1492, 1497 n.2
(D.C. Cir. 1984). Moreover, NARUC itself advised DOE that
7
After it had completed the Congestion Study, DOE did invite the gov-
ernors to consult. 72 Fed. Reg. at 56,996 n.18. (âThe Department sent a
letter to the Governor of each of the States within the draft National Corri-
dors and the Mayor of the District of Columbia on April 26, 2007, request-
ing an opportunity to consult with them on the draft designations.â).
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1931
meeting with it was not the same as consulting with the
affected States.8 The record also fails to support DOEâs asser-
tion that those meetings that were held with certain State enti-
ties allowed for a meaningful exchange of information.9
In sum, DOEâs claim that it met its obligation to consult
with the affected States is based on the argument that it had
the discretion to determine what âconsultationâ required, that
it met its obligation by inviting comments from the public
(including the affected States) while it was preparing the Con-
gestion Study, that it subsequently considered all objections to
the Congestion Study raised by the affected States, and that
any failures in this process of âconsultationâ were harmless.
8
NARUC wrote:
Because the statute directs the DOE to develop the congestion
study âin consultation with affected States,â the agency had an
affirmative obligation to seek the input of States potentially
affected by the Congestion Study. The purpose of this consulta-
tion is clear â States should be able to critique the DOEâs pre-
liminary findings and analyses as they are evolving. Although
DOE certainly conducted outreach to NARUC during the devel-
opment of the congestion study, it failed to comply with this
mandate with respect to States in certain regions (for example,
New England).
9
The e-mail cited by DOE in support of meetings with New York Public
Service Commission and the Florida Public Service Commission simply
notes that meetings took place. There is no identification of which individ-
uals attended the meetings or the subject of the meetings. At the cited
meetings with the Connecticut Department of Public Utility Control, the
New Jersey Board of Public Utilities, and the Pennsylvania Public Utility
Commission, DOE was represented by Ellen Lutz. In the e-mail, she
explains that she is DOEâs âRepresentative to the Eastern Interconnect,â
that this âis a new position that I began in late January,â and that she is
âin the process of coming up to speed on the issues.â Since at the time of
this e-mail, March 8, 2006, the Congestion Study was nearly complete, it
seems unlikely that the meetings provided any real opportunity for consul-
tation. Also, the document cited by DOE to support its contention that it
met with the CPUC indicates only that CPUC submitted further com-
ments, and does not state that any meeting was held.
1932 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
B. DOEâs interactions do not amount to
consultation
DOE claims that ⧠216 does not require more than notice-
and-comment proceedings.â DOE asserts that because Con-
gress did not define what it meant by âconsultation,â we must
defer to DOEâs interpretation of the term. However, we do not
read the statute as encompassing DOEâs proffered definition,
and such a definition is contrary to the applicable rules of stat-
utory interpretation as it would render Congressâs choice of
language meaningless. Moreover, we find no support for
DOEâs position in the relevant case law.
1. The definition of âconsultationâ
[4] An ordinary meaning of the word consult is to âseek
information or advice from (someone with expertise in a par-
ticular area)â or to âhave discussions or confer with (some-
one), typically before undertaking a course of action.â The
New Oxford Dictionary 369 (2001) (emphasis added). We
conclude that this is the definition that Congress intended
when it directed DOE to prepare the Congestion Study âin
consultation with the affected States.â Thus, DOE was to con-
fer with the affected States before it completed the study.
This conclusion is supported by all the applicable rules of
statutory construction. It is required by the statutory context
as the juxtaposition of the two sections indicates that Con-
gress intended consultation to be more than responding to
comments. See Robinson v. Shell Oil Co., 519 U.S. 337, 341
(1997) (noting that the plain meaning of statutory language is
determined by reference to the specific context in which the
language is used and the broader context of the statute as a
whole). The definition gives meaning to every word in the
statute. See Duncan v. Walker, 533 U.S. 167, 174 (2001) (not-
ing that it is a courtâs âduty to give effect, if possible, to every
clause and word of a statute.â). Moreover, DOEâs interpreta-
tion of âconsultâ to mean no more than notice-and-comment
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1933
would render part of the statute superfluous. If âconsultationâ
means no more than âan opportunity for comment,â there was
no reason for Congress to use distinct language in § 824(a)(1)
and § 824(a)(2). We have been directed to avoid such an
interpretation. See Knight v. Commâr, 552 U.S. 181, 190
(2008) (commenting that âaccepting [a particular] approach
would render part of the statute entirely superfluous, some-
thing that we are loath to doâ) (quoting Cooper Indus. v. Avi-
all Servs., 543 U.S. 157, 166 (2004)).
[5] Moreover, requiring DOE to actually confer with the
affected States is consistent with the purpose of the EPAct. In
reaction to black-outs and brown-outs, Congress sought to
give the federal government a greater role in the development
of transmission lines and to circumscribe somewhat the
Statesâ traditional authority over the placement and construc-
tion of power lines. In recognition of this impact on the
Statesâ traditional authority, Congress intended that affected
States would participate in a study that might ultimately result
in some limitation of their traditional powers. Indeed, the
Supreme Court has been sensitive to these concerns. See Solid
Waste Agency of Northern Cook County v. U.S. Army Corps
of Engârs, 531 U.S. 159, 173 (2001). A recognition of the sen-
sitivity of these issues supports our determination that where,
as here, Congress has directed an agency to consult with
States before taking action that may curtail traditional State
powers, we must require that the agency heed Congressâs
direction.
2. Case law defining consultation
In addition, our conclusion that the ordinary meaning of
consult involves conferring with an entity before taking action
is amply supported, if not compelled, by our relevant prece-
dent. In Environmental Defense Center v. EPA, 344 F.3d 832
(9th Cir. 2003), we considered a provision that required the
EPA to conduct certain studies âin consultation with the
States,â and to issue regulations based on these studies âin
1934 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
consultation with State and local officials.â Id. at 863. EPA
asserted that it had met its obligation by consulting exten-
sively with States and localities before issuing its regulations.
Id. at 864. We agreed, noting:
[T]he overall record indicates EPA met its statutory
duty of consultation. A draft of the first report was
circulated to States, EPA regional offices, the Asso-
ciation of State and Interstate Water Pollution Con-
trol Administrators (âASIWPCAâ), and other
stakeholders in November, 1993, and was revised
based on comments received. EPA established the
Urban Wet Weather Flows Federal Advisory Com-
mittee (âFACA Committeeâ), balancing membership
between EPAâs various outside stakeholder interests,
including representatives from States, municipalities,
Tribes, commercial and industrial sectors, agricul-
ture, and environmental and public interest groups.
64 Fed. Reg. 68,724. The 32 members of the Phase
II FACA Subcommittee, reflecting the same balance
of interests, met fourteen times over three years and
state and municipal representatives provided sub-
stantial input regarding the draft reports, the ultimate
Phase II Rule, and the supporting data.
Id. None of the efforts noted in Environmental Defense Cen-
ter are present here. No draft was circulated to the States, no
committee was created that included representatives from the
States, and the affected States were not given access to the
supporting data. Thus, DOEâs efforts here fall far short of the
efforts that were determined to meet the requirement for con-
sultation in Environmental Defense Center.
In Confederated Tribe & Bands of Yakima Indian Nation v.
FERC, 746 F.2d 466 (9th Cir. 1984), we held that the FERC
violated its duty of consultation. We noted that it was not
enough to give notice to the agencies and Indian tribes, as the
âconsultation obligation is an affirmative duty.â Id. at 475.
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1935
We noted that âthe respective fishery agencies believed the
consultation process would take place in the preparation of [a
fish and wildlife report],â but that the agency âissued the
[report] before the exhibit was submitted.â Id. Here too, the
agency had an affirmative duty to consult and the affected
States reasonably believed the consultation process would
take place, but DOE issued the Congestion Study without
engaging in any meaningful consultation with the States.
Our perspective is also consistent with the opinion of the
United States Court of International Trade in U.S. Steel Corp.
v. United States, 29 C.I.T. 33, 362 F. Supp. 2d 1336 (Ct. Intâl
Trade 2005). Addressing notice, comment, and consultation
requirements, the court held that âit is not enough to prove
that the agency solicited and received comments from the
Domestic Producers before executing the Suspension Agree-
ment. . . . The agency must also give those comments mean-
ingful considerationâ and âmust engage the Domestic
Producers in good faith consultations, in a timely fashion.â Id.
at 40. The court found that:
Throughout this action, the Government has per-
sisted in conflating Commerceâs notice-and-
comment obligations with its consultation obliga-
tions. And, to some extent, the Government has also
conflated its consultation obligations under one part
of the statute with its consultation obligations under
another part. However, the statute is clear: Com-
merceâs consultation obligations are separate and
distinct from (albeit related to) its notice-and-
comment obligations.
Id. at 40 n.14. We think that DOE pursued a similarly errone-
ous course here, attempting to conflate its obligation to con-
sult with the affected States while preparing the Congestion
Study with its obligation to provide the States an opportunity
to comment on its NIETC report.
1936 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
3. DOEâs failure to provide the affected States with
modeling data interfered with their ability to consult
with DOE
[6] We note that, by failing to provide the affected States
with the modeling data on which it based the Congestion
Study, DOE prevented the affected States from providing
informed criticism and comments. There can be no doubt that
the modeling data was critical to DOEâs study.10 Moreover,
DOE recognizes that even under a notice-and-comment
requirement, an agency has a duty to âidentify and make
available technical studies and data that it has employed in
reaching the decisions to propose particular rules.â Kern
County Farm Bureau v. Allen, 450 F.3d 1072, 1076 (9th Cir.
2006). DOE, however, defends its failure to disclose any of
the modeling data to the affected States prior to the issuance
of the Congestion Study by arguing that it disclosed the tech-
nical studies and data after it issued the Congestion Study and
that the information did not need to be disclosed because it
was proprietary.11 We have already held that DOEâs duty to
consult in preparing the Congestion Study is separate from,
and requires greater interaction with the affected States, than
DOEâs obligation to the States when preparing the NIETC
report. Accordingly, its post-study release of the information
does not excuse its failure to consult with the affected States
in preparing the Congestion Study.
10
The Congestion Studyâs Executive Summary states that it is DOEâs
âfirst congestion study in responseâ to the EPAct, and that it is based âon
examination of historical studies of transmission conditions, existing
studies of transmission expansion needs, and unprecedented region-wide
modeling of both the Eastern and Western Interconnections.â (Emphasis
added).
11
DOEâs intimation that it disclosed âthe technical studies and data on
which it relied â in the February 2006 Notice of Inquiryâ is misleading.
A review of the Notice of Inquiry discloses that it lists, by name or title
only, over 50 documents. 71 Fed. Reg. at 5663-64. It is not possible to
glean the substance, let alone the particulars, of the modeling studies from
the listed titles.
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1937
[7] Moreover, DOEâs argument that the proprietary inter-
ests in the modeling data justified their retention is not well
taken. First, as noted by the States, there is no factual or legal
basis for DOEâs unstated assumption that the States would
not, or could not, respect any legitimate proprietary interests
in the modeling data. Second, and more importantly, the case
cited by DOE, American Radio Relay League, Inc. v. Federal
Communications Commission, 524 F.3d 227 (D.C. Cir. 2008),
specifically states that under the Administrative Procedure
Act (âAPAâ) an agency must disclose the technical studies
and data upon which it bases a ruling.12 Third, there is no
doubt that the modeling information was critical to DOEâs
preparation of the Congestion Study.13 The ability to âconsultâ
12
The court explained:
Under APA notice and comment requirements, â[a]mong the
information that must be revealed for public evaluation are the
âtechnical studies and dataâ upon which the agency relies [in its
rulemaking].â . . . Construing section 553 of the APA, the court
explained long ago that â[i]n order to allow for useful criticism,
it is especially important for the agency to identify and make
available technical studies and data that it has employed in reach-
ing the decisions to propose particular rules.â . . .
524 F.3d at 236 (citations omitted). The court further noted that:
Enforcing the APAâs notice and comment requirements ensures
that an agency does not âfail[ ] to reveal portions of the technical
basis for a proposed rule in time to allow for meaningful com-
mentaryâ so that âa genuine interchangeâ occurs rather than âal-
low[ing] an agency to play hunt the peanut with technical
information, hiding or disguising the information that it
employs.â . . .
Id. at 236-37 (citation omitted). The court further observed that it was âa
fairly obvious proposition that studies upon which an agency relies in pro-
mulgating a rule must be made available during the rulemaking in order
to afford interested persons meaningful notice and an opportunity for com-
ment.â Id. at 237.
13
DOE states that it âevaluated electric transmission congestion by: (1)
reviewing historical data related to congestion from dozens of sources, (2)
developing projections of future congestion, and (3) comparing the two.â
Moreover, DOE consistently reiterates that impacts from persistent con-
gestion âare not readily subject to empirical measurementâ and that the
âtask of drawing boundaries around âgeographic areasâ experiencing con-
straints or congestion is not one that lends itself to technical precision.â
1938 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
on a matter is severely compromised when an entity is denied
access to the basis of the decision.
C. The Failure to Consult Was Not Harmless Error
[8] More importantly, we cannot conclude that DOEâs fail-
ure to consult was harmless error. Certainly, American Radio
Relay League notes that any failure to disclose information
for public comment is subject to the rule of prejudicial error.
Id. at 237. We also have held that when reviewing agency
action under the APA, we must take âdue accountâ of the
harmless error rule. Paulsen v. Daniels, 413 F.3d 999, 1006
(9th Cir. 2005). We have stressed, however, that a court âmust
exercise great caution in applying the harmless error rule in
the administrative rulemaking context.â Id. In Riverbend
Farms, Inc. v. Madigan, 958 F.2d 1479 (9th Cir. 1992), which
involved a failure of an agency to fulfill the notice-and-
comment procedures of the APA, we stated:
Itâs true, as plaintiffs argue, that we must exercise
great caution in applying the harmless error rule in
the administrative rulemaking context. The reason is
apparent: Harmless error is more readily abused
there than in the civil or criminal context. An agency
is not required to adopt a rule that conforms in any
way to the comments presented to it. So long as it
explains its reasons, it may adopt a rule that all com-
mentators think is stupid or unnecessary. Thus, if the
harmless error rule were to look solely to result, an
agency could always claim that it would have
adopted the same rule even if it had complied with
APA procedures. To avoid gutting the APAâs proce-
dural requirements, harmless error analysis in
administrative rulemaking must therefore focus on
the process as well as the result. We have held that
the failure to provide notice and comment is harm-
less only where the agencyâs mistake âclearly had no
bearing on the procedure used or the substance of
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1939
decision reached.â Sagebrush Rebellion, Inc. v.
Hodel, 790 F.2d 760, 764-65 (9th Cir.1986).
Id. at 1487.
We have applied this definition of harmless error â
âclearly had no bearing on the procedure used or the sub-
stance of decision reachedâ â in a number of cases over the
last eighteen years. For example, see Paulsen, 413 F.3d at
1006-08 (adopting the âno bearingâ standard, noting that the
agencyâs âmistake clearly had a bearing on the procedure
used,â and commenting that the fact that âpetitioners had an
opportunity to protest an already-effective rule prior to the
time it was applied to each of them does not render the APA
violation harmlessâ); City of Sausalito v. OâNeill, 386 F.3d
1186, 1220 (9th Cir. 2004) (holding that âin the rulemaking
context, we exercise great caution in applying the harmless
error rule, holding that failure to provide notice and comment
is harmless only where the agencyâs mistake clearly had no
bearing on the procedure used or the substance of decision
reachedâ) (internal quotation marks and citations omitted);
Gifford Pinchot Task Force v. U.S. Fish and Wildlife Service,
378 F.3d 1059, 1071 (9th Cir. 2004) (noting that in the con-
text of agency review, the role of harmless error is con-
strained and may be employed only âwhen a mistake of the
administrative body is one that clearly had no bearing on the
procedure used or the substance of decision reachedâ); and
Buschmann v. Schweiker, 676 F.2d 352, 358 (9th Cir. 1982)
(holding that an agency can rely on harmless error only when
a mistake of the administrative body is one that clearly had no
bearing on the procedure used or the substance of decision
reached) (internal quotations marks and citations omitted).14
14
Furthermore, we are not alone in using this standard. It was set forth
by the D.C. Circuit in Braniff Airways, Inc. v. C. A. B., 379 F.2d 453, 462
(D.C. Cir. 1967), when it stated that an error âdoes not mechanically com-
pel reversal âwhen a mistake of the administrative body is one that clearly
had no bearing on the procedure used or the substance of decision
1940 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
The dissent, however, posits that the Supreme Courtâs
recent decision in Shinseki v. Sanders, 129 S. Ct. 1696 (2009),
requires a different definition of âharmless error.â We do not
agree. In Sanders, the Supreme Court clarified that in agency
cases, as in appellate review of civil cases, âthe burden of
showing an error is harmful normally falls upon the party
attacking the agencyâs determination.â Id. at 1706. The
Supreme Court struck down the Federal Circuitâs âharmless
errorâ framework, in part because it ârequire[d] the VA, not
the claimant to explain why the error [was] harmless.â Id. at
1705.
The Court, however, did not redefine âharmless error,â but
rather embraced a commonsense approach to the concept.
To say that the claimant has the âburdenâ of showing
that an error was harmful is not to impose a complex
system of âburden shiftingâ rules or a particularly
onerous requirement. In ordinary civil appeals, for
example, the appellant will point to rulings by the
trial judge that the appellant claims are erroneous,
say, a ruling excluding favorable evidence. Often the
circumstances of the case will make clear to the
appellate judge that the ruling, if erroneous, was
harmful and nothing further need be said. But, if not,
then the party seeking reversal normally must
explain why the erroneous ruling caused harm. If, for
reached.â Massachusetts Trustees of Eastern Gas and Fuel Associates v.
United States, 377 U.S. 235, 248 (1964).â See also Silverton Snowmobile
Club v. U.S. Forest Service, 433 F.3d 772 (10th Cir. 2006) (noting that
harmless error may be employed only when a mistake of the administra-
tive body is one that clearly had no bearing on the procedure used or the
substance of the decision reached) (internal quotation marks and citations
omitted); and Conservation Law Foundation v. Evans, 360 F.3d 21, 29
(1st Cir. 2004) (noting that the omission of a formal public comment
before it âclearly had no bearing on the procedure used or the substance
of [the] decision reachedâ).
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1941
example, the party seeking an affirmance makes a
strong argument that the evidence on the point was
overwhelming regardless, it normally makes sense to
ask the party seeking reversal to provide an explana-
tion, say, by marshaling the facts and evidence
showing the contrary. The party seeking to reverse
the result of a civil proceeding will likely be in a
position at least as good as, and often better than, the
opposing party to explain how he has been hurt by
an error.
129 S. Ct. at 1706.
[9] We do not think that this approach to harmless error
allows us to depart from our consistent case law holding that
âharmless errorâ requires a determination that the error âhad
no bearing on the procedure used or the substance of [the]
decision reached.â Paulsen, 413 F.3d at 1006 (quoting Sage-
brush, 790 F.2d at 764-65). In Miller v. Gammie, 335 F.3d
889 (9th Cir. 2003) (en banc), we held that âwhere the reason-
ing or theory of our prior circuit authority is clearly irreconcil-
able with the reasoning or theory of intervening higher
authority, a three-judge panel should consider itself bound by
the later and controlling authority, and should reject the prior
circuit opinion as having been effectively overruled.â Id. at
893. Certainly, Sanders clarifies that the burden of showing
an agencyâs deviation from the APA was not harmless rests
with the petitioner, but we see nothing in Sanders that is
âclearly irreconcilable with the reasoning or theoryâ underly-
ing our definition of harmless error.15
15
We note that the law review article cited by the dissent, Craig Smith,
Taking âDue Accountâ of the APAâs Prejudicial-Error Rule, 96 Va. L.
Rev. 1727 (2010), is in accord. It opines that Sanders âdeclared something
already widely understood: the burden of demonstrating harm is borne by
the parties challenging agenciesâ decisions,â but âleft unexplored the inter-
esting and important question of how parties can persuade a court that an
error was prejudicial.â Id. at 1728.
1942 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
Moreover, here our concern with process is very different
from the issue in Sanders. There, the Supreme Courtâs exclu-
sive focus on the harmlessness of the error in affecting the
final outcome â the determination of disability â was a logi-
cal application of the statutory and regulatory requirements of
notice by the agency to the veteran as to how to pursue his
claim. The notice requirement was not an end in itself; it was
a means to permit the veteran to develop his claim for disabil-
ity. If a failure of notice had no effect on the determination
of the disability claim, there could be no harm; the failure of
notice by itself was of no consequence.
In contrast, here, as in Riverbend Farms, the congressional
notice requirement reflects the desirability of the interactive
process itself.16 958 F.2d at 1479. The consultative process
dictated by Congress serves the purpose of permitting the
States to participate in the formulation of federal policy in an
area of major interest to the States. As in Riverbend Farms,
Congress did not require the agency to accept the views of the
States; its requirement was directed at process and not merely
a final result (although early consultation often will lead to a
better result). Id. at 1487. Under such a scheme, we are not
free to depart from our consistent case law holding that a find-
ing of âharmless errorâ requires a determination that the error
âhad no bearing on the procedure used or the substance of
[the] decision reached.â Paulsen, 413 F.3d at 1006 (quoting
Sagebrush, 790 F.2d at 764-65) (emphasis added).
16
We noted in Riverbend Farms:
Procedure, not substance, is what most distinguishes our govern-
ment from others. In the not-so-distant past, a government agency
in the Soviet Union could impose controls on the production of
commodities without bothering to involve the public in the deci-
sionmaking process. By contrast, a government agency in the
United States must usually give notice to, and accept comments
from, the public before undertaking to place manacles on the
invisible hand.
Riverbend Farms, 958 F.2d at 1482.
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1943
The dissent, however, prefers the D.C. Circuitâs approach
in Gerber v. Norton, 294 F.3d 173, 182 (D.C. Cir. 2002), that
to show âthat error was prejudicial a plaintiff must indicate
with reasonable specificity what portions of the documents it
objects to and how it might have responded if given the
opportunity.â (internal quotation marks and citations omitted).
The dissent asserts that other circuits have adopted a similar
approach for showing prejudice from procedural errors.17
[10] Although we are compelled to follow our prior case
law, we would reach the same conclusion applying the stan-
dard proffered by the dissent. We find that the petitioners
have demonstrated that they were excluded from the decision-
making process, have indicated what evidence and informa-
tion they would have provided if given the opportunity, and
have shown how their interests were harmed by their exclu-
sion.
[11] Placing the burden of showing that DOEâs failure to
consult was not harmless on the petitioners, we determine that
the affected States have shown that DOEâs failure to comply
with Congressâs mandate in § 216 was harmful. First, we note
that although the nature of consultation makes it difficult to
determine the precise consequences of its absence, the preju-
dice to the party excluded is obvious. Consultation requires an
exchange of information and opinions before the agency
makes a decision. This requirement is distinct from the oppor-
tunity to offer comments on the agencyâs decision. The essen-
tial verity of this distinction is illustrated by posing the
question: would any attorney forgo the opportunity to argue
his clientâs case before a judge renders a decision in favor of
seeking reconsideration after the judge has made a decision?
17
The dissent cites Conservation Law Found. v. Evans, 360 F.3d 21, 29
-30 (1st Cir. 2004); Texas v. Lyng, 868 F.2d 795, 800 (5th Cir. 1989);
Miami-Dade Cnty. v. EPA, 529 F.3d 1049, 1061 (11th Cir. 2008); and
Owner-Operator Indep. Drivers Assân, Inc. v. Fed. Motor Carrier Safety
Admin., 494 F.3d 188, 202-03 (D.C. Cir. 2007).
1944 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
Of course not; such a decision might well amount to malprac-
tice. Similarly, here, the opportunity to comment on DOEâs
completed Congestion Study does not compensate for the lost
opportunity of consulting with DOE in the formation of that
study.18
Another drawback of the dissentâs approach is its failure to
appreciate that DOEâs failure to consult has a substantive, as
well as procedural component. The exclusion of the affected
States from the decisionmaking process not only limited the
information available to DOE, it altered the way in which
DOE made its discretionary decisions. In Kurzon v. United
States Postal Service, 539 F.2d 788 (1st Cir. 1976), the First
Circuit indicated that where there was an alleged substantive
error, it would remand âonly if the court is in substantial
doubt whether the administrative agency would have made
the same ultimate finding with the erroneous finding removed
from the picture.â Id. at 796 (internal quotation marks and
citations omitted). Here, we are left with substantial doubt as
to whether DOE would have made the same findings had it
consulted with the affected States.
Second, the impact of the lack of consultation before a
decision is made as contrasted to commenting after the
agency has made a decision is particularly severe here
because, as DOE admits, its decisions were for the most part
discretionary. In its May 7, 2007, Notice, DOE stated that
âthere is no generally accepted understanding of what consti-
tutes âconstraints or congestion that adversely affects consum-
ers,â â 72 Fed. Reg. at 25,843, and noted that â[t]he statute
18
In Sanders, the Court noted that it had âpreviously made clear that
courts may sometimes make empirically based generalizations about what
kinds of error are likely, as a factual matter, to prove harmful.â 129 S. Ct.
at 1707. A reasonable argument can be made that a failure to consult prior
to making a discretionary decision, when such consultation is mandated by
law, is the type of error that is likely to prove harmful. However, in light
of the affected Statesâ showing of prejudice we need not consider such an
argument.
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1945
provides little direction on how the Department should draw
the boundaries of a National Corridor,â id. at 25,848. Thus,
DOE admits that its determinations and conclusions in the
Congestion Study were not decisions compelled by some
mathematical formulae, but important discretionary decisions
for which there was little guidance.19 The value of consulting
with an agency before it makes a decision is greatest when the
agency is tasked with adopting a ânovel approachâ that will
then affect all stakeholders. In such a situation, as here, a
court can hardly conclude that the agencyâs refusal to consult
with the affected States had no bearing on the substance of the
decision reached. See Paulsen, 413 F.3d at 1006.
The dissentâs recitation of the Statesâ âopportunity to com-
mentâ reflects its failure to appreciate how consulting is dif-
ferent from commenting. Of course, the States were aware
that Congress had directed DOE to conduct a Congestion
Study. They had to protect themselves, and perhaps try to
reduce the potential harm from a lack of consultation, by
responding to DOEâs request for comments. But, contrary to
the dissentâs suggestion, there is no evidence that DOE ever
consulted with any State.20
19
The May 7, 2007 Notice commented that DOE ârecognizes that FPA
section 216(a) adopted a novel approach to addressing the need for new
transmission infrastructure, an approach that poses challenges to all stake-
holders as we collectively work to address this problem.â 72 Fed. Reg. at
25,845.
20
The dissent claims that DOE participated in conference calls from
state entities and âmet and corresponded withâ commissions from five
states. It bases this assertion on DOEâs lists of its contacts with states.
However, there is no indication that these provided any real opportunity
for consultation. Less than half of the contacts listed at 72 Fed. Reg.
25,850 n.35 were actually with state officials rather than various organiza-
tions that may have included state officials. More telling, a review of the
list compiled by DOE of âoutreach meetings held regarding the Conges-
tion Study,â reveals that only two of the sixty-two meetings were with
officials of a state.
1946 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
Finally, a review of the objections filed by the affected
States and others reveals that DOEâs failure to consult with
the affected States in developing the Congestion Study was
not harmless error and that consultation would probably have
resulted in a different study.21 Among the over 400 comments
that DOE received when it published the Congestion Study
were assertions that: (1) âthe focus of the Congestion study is
too narrow to accommodate State laws and policies on renew-
able portfolio standardsâ; (2) DOE had adopted too broad a
definition of âadverse effectsâ; (3) designations should only
be made for areas actually experiencing congestion adversely
affecting consumers and not areas that may experience con-
gestion in the future; and (4) DOE should clarify the criteria
it would use in deciding whether to designate a National Cor-
ridor. 72 Fed. Reg. at 25,842-43.
DOE does not claim that its decisions in the Congestion
Study were compelled or that consultation could not have pro-
duced variations. Rather, DOEâs responses to the comments
stress its âdiscretion,â implicitly recognizing that consultation
might well have resulted in different decisions. For example,
the first line of DOEâs response stresses that § 216 gives it
âdiscretion.â Id. at 25,843. It admits that the term âconstraints
or congestion that adversely affects consumers . . . is ambigu-
ous and the statute attaches no modifiers to the term to specify
21
The dissentâs failure to appreciate the practical impact of DOEâs fail-
ure to consult with the affected States renders the Congressional directive
to consult with the affected States unenforcable. Under the dissentâs
approach, an agency could refuse to consult in its decisionmaking process,
but no State could show âharmâ because the agency would argue that it
allowed for comments after it rendered its decision and it declined to
adjust its decision on the basis of those comments. Because no State could
show that the agency would have made a different decision if it engaged
in consultation, no State could shoulder the burden of showing prejudice.
Indeed, this is precisely the argument that the dissent makes in rejecting
the Eastern States claim that DOE had âincorrect and flawed documenta-
tion.â The dissent accepts as dispositive DOEâs post-Congestion Study
explanation that the discrepancies and reporting errors âdid not affect the
analysis and findings of the Congestion Study.â Dissent at 1981.
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1947
the particular type of magnitude of adverse effect intended.â
Id. DOEâs admission that a term is ambiguous and that the
statute provides little guidance in its interpretation indicates
that its decisions might well have been altered through con-
sultation with the affected States.
The likelihood that consultation would produce different
results may be seen, for example, in the petitionersâ objec-
tions to DOEâs designation of the entire Mid-Atlantic region
as a NIETC Corridor and to their assertions that DOE failed
to consider regional efforts to address energy constraints and
congestions. This is not to suggest that DOEâs determinations
were unreasonable. Rather, it appears that petitionersâ objec-
tions are not frivolous, may well have some merit, and thus,
we cannot conclude that DOE, were it to exercise its discre-
tion when informed by consultation with the affected States,
would not modify its decisions.
[12] The failure to consult was not some technical error,
but resulted in a decisionmaking process that was contrary to
that mandated by Congress and one that deprived DOE of
timely substantive information. We conclude that DOEâs fail-
ure to consult with the affected States, as directed by Con-
gress, was not harmless error.
IV. THE REMEDY
[13] When a court determines that an agencyâs action
failed to follow Congressâs clear mandate the appropriate
remedy is to vacate that action. See, e.g., Nw. Envtl. Advo-
cates v. EPA, 537 F.3d 1006, 1026-27 (9th Cir. 2008)
(explaining that the district courtâs decision to vacate the
EPAâs action was the proper remedy when EPA acted outside
of its authority and in defiance of Congressâs clear intent).
Similarly, where a regulation is promulgated in violation of
the APA and the violation is not harmless, the remedy is to
invalidate the regulation. See Paulsen, 413 F.3d at 1008.
Accordingly, as we have determined that § 216 required more
1948 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
than the notice-and-comment procedure adopted by DOE, and
that DOEâs failure to consult with the affected States was not
harmless error, precedent and reason require that we vacate
the Congestion Study and remand for the DOE to prepare a
Congestion Study âin consultation with the affected States.â
[14] DOEâs suggestion that we might vacate only those
portions of the Congestion Study for which the States have
shown prejudice, misconstrues the nature of the right to con-
sultation as well as the deference we owe to DOEâs decisions.
As noted, it is almost impossible to determine the precise
impact of a decisionmakerâs failure to consult prior to making
a discretionary decision. Because the Congestion Study
invokes DOEâs sound discretion for which there are few, if
any, objective criteria, we simply cannot know what DOE
would have decided had it considered the affected Stateâs per-
spectives before it completed the study, or foretell what it will
decide after consulting with the affected States. Accordingly,
DOE must prepare a Congestion Study in consultation with
the affected States which thereafter may be judicially
reviewed. We express no opinion as to the form or results of
the collaboration. Indeed, presumably DOE could, in the exer-
cise of its sound discretion, come to the same or similar con-
clusions that it did in the initial study. Of course, it might
reach very different conclusions. What is critical is that it fol-
low the statuteâs mandate and consult with affected States,
particularly as § 216 requires DOE to prepare a congestion
study every three years.
V. THE FAILURE TO UNDERTAKE AN
ENVIRONMENTAL STUDY
We next address DOEâs failure to prepare an Environmen-
tal Impact Statement (âEISâ) or an Environmental Assess-
ment (âEAâ) for either of the NIETCs. We do so for two
reasons. First, even if we had not determined that the Conges-
tion Study must be vacated, we would nonetheless hold that
the NIETCs must be vacated because DOE violated the law
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1949
in failing to consider the environmental consequences of the
NIETCs. Second, because DOE will now have to prepare new
NIETCs based on a new Congestion Study, our guidance on
this issue should be useful for all concerned.
A. The Applicable Law
[15] All parties agree that pursuant to the National Envi-
ronmental Policy Act, 42 U.S.C. § 4332(2)(C), DOE, like any
other federal agency, must include âin every recommendation
or report on proposals for legislation and other major Federal
actions significantly affecting the quality of the human envi-
ronment, a detailed statement by the responsible official onâ
the potential environmental consequences of the action.22 Id.
22
Section 4332(2)(C) provides that:
all agencies of the Federal Government shall:
...
(C) include in every recommendation or report on proposals for
legislation and other major Federal actions significantly affecting
the quality of the human environment, a detailed statement by the
responsible official onâ
(I) the environmental impact of the proposed action,
(ii) any adverse environmental effects which cannot be avoided
should the proposal be implemented,
(iii) alternatives to the proposed action,
(iv) the relationship between local short-term uses of manâs envi-
ronment and the maintenance and enhancement of long-term pro-
ductivity, and
(v) any irreversible and irretrievable commitments of resources
which would be involved in the proposed action should it be
implemented.
Prior to making any detailed statement, the responsible Federal
official shall consult with and obtain the comments of any Fed-
eral agency which has jurisdiction by law or special expertise
with respect to any environmental impact involved.
1950 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
In Marsh v. Oregon Natural Resources Council, 490 U.S.
360 (1989), the Supreme Court noted that âNEPA promotes
its sweeping commitment to prevent or eliminate damage to
the environment and biosphere by focusing Government and
public attention on the environmental effects of proposed
agency actionâ so that the âagency will not act on incomplete
information, only to regret its decision after it is too late to
correct.â Id. at 371 (internal quotation marks and citations
omitted). In Winter v. Natural Resources Defense Council,
Inc., 555 U.S. 7, 129 S. Ct. 365 (2008), the Supreme Court
reiterated that â[p]art of the harm NEPA attempts to prevent
in requiring an EIS is that, without one, there may be little if
any information about prospective environmental harms and
potential mitigating measures.â 129 S. Ct. at 376; see also
Monsanto v. Geertson Seed Farms, 130 S. Ct. 2743, 2768
(2010) (Stevens, J., dissenting) (noting that an EIS is espe-
cially important where the environmental threat is novel).
Ultimately, our role âis to insure that the agency has taken a
âhard lookâ at environmental consequences . . . .â Kleppe v.
Sierra Club, 427 U.S. 390, 410 n.21 (1976).
In accord with this approach, we have reiterated that the
âagency bears the primary responsibility to ensure that it com-
plies with NEPA.â âIlioâulaokalani Coal. v. Rumsfeld, 464
F.3d 1083, 1092 (9th Cir. 2006) (quoting Depât of Transp. v.
Pub. Citizen, 541 U.S. 752, 765 (2004)). We reiterated in
Alaska Ctr. for Environment v. U.S. Forest Service, 189 F.3d
851, 859 (9th Cir. 1999), that â[w]hen an agency decides to
proceed with an action in the absence of an EA or EIS, the
agency must adequately explain its decision.â Id. (internal
citation omitted). We commented that â[a]n agency cannot
avoid its statutory responsibilities under NEPA merely by
asserting that an activity it wishes to pursue will have an
insignificant effect on the environment.â Id. (quoting The
Steamboaters v. FERC, 759 F.2d 1382, 1393 (9th Cir. 1985)).
In Klamath Siskiyou Wildlands Center v. Boody, 468 F.3d
549 (9th Cir. 2006), we noted that an EIS âmust be prepared
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1951
if substantial questions are raised as to whether a project may
cause significant degradation of some human environmental
factor.â Id. at 562 (internal citation omitted). We explained
that â[t]he plaintiff need not show that significant effects will
in fact occur, but if the plaintiff raises substantial questions
whether a project may have a significant effect, an EIS must
be prepared,â and noted that â[t]his is a low standard.â Id.
(internal citation omitted). In addition, we stated:
Furthermore, not only did BLM fail to conduct an
EIS prior to implementing either of the ASR Deci-
sions, it did not even conduct an EA. NEPAâs imple-
menting regulations state that EAs should be
conducted âto provide sufficient evidence and analy-
sis for determining whether to prepare an environ-
mental impact statement or a finding of no
significant impact.â 40 C.F.R. § 1508.9(a)(1).
Indeed, as we explained in Metcalf v. Daley, 214
F.3d 1135, 1143 (9th Cir. 2000), â[b]ecause the very
important decision whether to prepare an EIS is
based solely on the EA, the EA is fundamental to the
decision-making process.â In this vein, we have held
that â[i]f the proposed action does not categorically
require the preparation of an EIS, the agency must
prepare an EA to determine whether the action will
have a significant effect on the environment.â Kern
v. Bureau of Land Mgmt., 284 F.3d 1062, 1066 (9th
Cir. 2002).
Klamath, 468 F.3d at 562.
[16] Thus, our precedents hold that an agency cannot
merely assert that its decision will have an insignificant effect
on the environment, but âmust adequately explain its deci-
sion.â Alaska Ctr., 189 F.3d at 859. In The Steamboaters, we
reversed and vacated the agencyâs order because the agency
failed to prepare even an EA and did ânot discuss the evi-
dence presented by the various agencies or how the particular
1952 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
conditions placed on the project would prevent environmental
damage.â 759 F.2d at 1393. We explained that the âagency
must supply a convincing statement of reasons why potential
effects are insignificant.â Id. (internal citation omitted). âThe
appellate court must be able to determine whether the agency
took a âhard lookâ at the potential environment impacts of the
projectâ and â[t]he statement of reasons is crucial to such a
determination.â Id.
B. Evaluating DOEâs assertion of no environmental
impact
We apply these standards to DOEâs assertion that, although
NEPA applies, it was not required to undertake any review of
potential environmental consequences because the NIETCs do
not have any environmental effects.23 We are compelled to
reject DOEâs assertion because (1) its conclusory statement
does not allow us to determine whether DOE took a âhard
lookâ at the potential environmental consequences; and (2)
although the effects of the NIETCs may be uncertain and dif-
ficult to quantify, the potential consequences of such effects
are significant enough to undermine DOEâs conclusory deter-
mination that no EA need be prepared.24
1. The NIETCs do not determine the siting of any
particular facility
[17] DOE argues that the NIETCs do not have any envi-
ronmental effect because they do not approve of the siting of
any transmission facility, and furthermore, any particular sit-
ing will be subject to NEPA review. Our precedent, however,
provides that agency action may constitute a âmajor Federal
23
See 72 Fed. Reg. 57,022; 73 Fed. Reg. 12,968.
24
For these reasons, as elaborated in the following sections, although
recognizing that this is a close case, we disagree with the dissentâs per-
spective that the Designation Order constitutes an adequate EA (dissent at
1986).
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1953
actionâ even though the program does not direct any immedi-
ate ground-breaking activity.
In Forelaws on Board v. Johnson, 743 F.2d 677 (9th Cir.
1984), the petitioners challenged the Bonneville Power
Administrationâs (âBPAâ) offers of long-term contracts for
power. Id. at 679. Although BPA argued that its actions âthat
merely allocate federal power to different customers do not
significantly affect the environment,â we held that the con-
tracts raised âconsiderations of far greater historic and
regional import and significantly affect the environment.â25
Id. at 682. Accordingly, we concluded that BPAâs action was
not sufficient and required the preparation of an EIS. Id. at
686.
[18] DOE recognizes the relevancy of Forelaws, but seeks
to distinguish the case on the ground that DOE has no author-
ity to site electric transmission facilities. This distinction is
not persuasive because the NIETCs, in essence, influence the
areas in which electric transmission facilities will be located,
even though they do not determine the precise locations of the
facilities. As in Forelaws, the locations of those areas could
have great historic and regional consequences that signifi-
cantly affect the environment. Thus, the fact that the NIETCs
do not approve the actual sitings of specific transmission
facilities does not excuse DOE from considering the NIETCsâ
environmental impacts.
Furthermore, Forelaws does not stand alone in holding that
broad agency programs may constitute âmajor Federal
actions,â even though the programs do not direct any immedi-
25
Among the other potential effects warranting review under the NEPA
were the fact that âby defining the federal base system and ânew large sin-
gle loadsâ the contracts help determine the magnitude of BPA power obli-
gations in the future and thus will have an impact upon long-range
regional energy plansâ and that âthe contracts significantly affect the envi-
ronment because they involve important policy choices affecting energy
conservation.â 743 F.2d at 682.
1954 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
ate ground-disturbing activity. See Oregon Natural Desert
Assân v. BLM, 531 F.3d 1114, 1116 (9th Cir. 2008) (finding
EIS inadequate for land use plan covering a large portion of
Oregon); N. Alaska Envtl. Ctr v. Kempthorne, 457 F.3d 969,
973 (9th Cir. 2006) (noting that an EIS was prepared for
agency action making entire Northwest Petroleum Reserve
available for oil and gas leasing despite the lack of âsite spe-
cific analysis for particular locations where drilling might
occurâ); Friends of Yosemite Valley v. Norton, 348 F.3d 789,
800-01 (9th Cir. 2003) (evaluating programmatic EIS for land
use plan for national park);26 Blue Mountain Biodiversity
Project v. Blackwood, 161 F.3d 1208, 1213 (9th Cir. 1998)
(finding EA inadequate and requiring EIS for log-salvaging
plan for national forest).27
26
In Friends of Yosemite, we recognized that:
[A]n agencyâs planning and management decisions may occur at
two distinct administrative levels: (1) the âprogrammatic levelâ
at which the [agency] develops alternative management scenarios
responsive to public concerns, analyzes the costs, benefits and
consequences of each alternative in an [EIS], and adopts an
amendable [management] plan to guide management of multiple
use resources; and (2) the implementation stage during which
individual site specific projects, consistent with the [manage-
ment] plan, are proposed and assessed.
348 F.3d at 800. We also recognized that an agency must prepare an EIS
at each level. âAn EIS for a programmatic plan (such as the CMP) must
provide sufficient detail to foster informed decision-making, but site-
specific impacts need not be fully evaluated until a critical decision has
been made to act on site development.â Id. (internal quotation marks and
citations omitted).
27
We noted that a âproject may have significant environmental impacts
where its effects are highly uncertain or involve unique or unknown risksâ
and âwarned that general statements about âpossibleâ effects and âsome
riskâ do not constitute a âhard lookâ absent a justification regarding why
more definitive information could not be provided.â Blue Mountain, 161
F.3d at 1213 (quotation marks and citations omitted).
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1955
2. The NIETCs are major federal actions
a. Northcoast Environmental Center v. Glickman
DOE asserts that the NIETCs are not major federal actions
because it would be pure speculation to predict their environ-
mental impacts. Citing Northcoast Environmental Center v.
Glickman, 136 F.3d 660 (9th Cir. 1998), DOE asserts that an
agency action that has only speculative environmental
impacts is not a major federal action.
Our holding in Northcoast is more nuanced than suggested
by DOE. At issue in that case was a proposal by the Forest
Service (âFSâ) to establish guidelines for research, manage-
ment strategies, and information sharing concerning a root rot
fungus on federal land in Oregon. Id. at 670. The district court
found that the programs did not constitute final agency action
subject to judicial review and that even if they did, they âwere
not major federal actions significantly affecting the environ-
ment.â Id. at 668.
On appeal, we first noted that where review is sought under
the general review provision of the APA, the agencyâs deci-
sion must be a final agency action and the plaintiffs âmust
establish they have suffered a legal wrong, or will be
adversely affected or aggrieved within the meaning of the rel-
evant statute.â Id. We proceeded to comment that the agency
action âmust (1) be federal, (2) âmajorâ, and (3) have a signifi-
cant environmental impact.â28 Id. The opinion focused on the
third requirement. We concluded that the district court âprop-
erly recognizedâ that none of the activities had an actual or
immediately threatened effect on the environment and âcor-
rectly decidedâ that the FS âreasonably foundâ that its actions
did not significantly affect the quality of human environment.â29
28
We further noted that an âEIS is not necessary where a proposed fed-
eral action would not change the status quo.â 136 F.3d at 668. Here there
is no question that the NIETCs change the status quo.
29
We noted:
The FS Action Planâs âAction Items/Objectivesâ section does not
1956 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
Id. at 669-70. Although sympathetic to plaintiffsâ concern that
agencies should conduct a full NEPA analysis when manage-
ment plans are implemented or proposed, we concluded that
the current forest management programs did not âcall for spe-
cific enough action to trigger NEPAâs procedural require-
ments,â and noted that plaintiffs could âchallenge the
sufficiency of an agency EIS when discrete agency action is
called for.â Id. at 670.
Northcoast offers several points of guidance. First, in deter-
mining whether the program had a significant environmental
impact, we implicitly held that the program was a final
agency action subject to review under the APA, even though
we recognized that plaintiffs could âchallenge the sufficiency
of an agency EIS when discrete agency action is called for.â30
Id. Second, we determined that the program was, at least
potentially, a âmajorâ Federal action. It is not clear whether
the requirement that agency action be âmajorâ was considered
separately from the requirement that the action have âsignifi-
cant environmental impact,â or whether the latter was treated
create activities which impact the physical environment. Rather,
the Action Items/Objectives set forth guidelines and goals for
POC research, management strategies and information sharing.
They do not provide for specific activities with a direct impact on
POC. Similarly, BLMâs POC Management Guidelines provide
management strategies and goals for dealing with POC preserva-
tion and timber sales on BLM managed land. The Guidelines nei-
ther propose any site-specific activity nor do they call for specific
actions directly impacting the physical environment. Therefore,
we find the Secretaries reasonably decided that an EIS was not
required for their POC management programs.
136 F.3d at 670.
30
The district court had held that the program âwas not a final agency
action and, thus, not subject to review.â 136 F.3d at 668. However, in
determining whether the program had a significant environmental impact,
we implicitly rejected this determination. If the program had not been
final, then it would not have been subject to judicial review under the APA
and plaintiffsâ complaint would have been dismissed.
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1957
as an element of the former. In any event, the opinion cer-
tainly implies that if the program did have a significant envi-
ronmental impact, it would have been a âmajorâ federal
action.
Third, although Northcoast states that an agency need not
prepare an environmental study when its action does not have
a significant environmental impact, it also holds that the
record must be sufficient to allow the court to determine that
the agencyâs conclusion was reasonable. See 136 F.3d at 670.
Here, the NIETCs are undoubtedly final agency actions.
The NIETCs conclude DOEâs responsibilities under § 216.
They establish the boundaries for two national electric trans-
mission corridors. Once the NIETCs become final, any ques-
tion as to the actual siting of a facility within the corridors
will be addressed to FERC. See 73 Fed. Reg. at 12,969
(âDOE agrees that the effect of a National Corridor is to
delineate geographic areas within which, under certain cir-
cumstances, FERC may ultimately authorize the construction
or modification of electric transmission facilities.â).
[19] Both the intent and impact of the NIETCs support the
conclusion that they constitute major Federal action. They
create âNational Interestâ corridors to address national con-
cerns. The NIETCs cover over a 100 million acres in ten
States. Moreover, they create new federal rights, including the
power of eminent domain, that are intended to, and do, curtail
rights traditionally held by the states and local governments.
See 16 U.S.C. § 824p(b), (e). In sum, we hold that the
NIETCs are final agency actions that constitute major Federal
actions.
b. The NIETCs raise significant environmental impacts
The remaining question is whether the NIETCs could have
significant environmental impacts or, more accurately,
1958 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
whether DOE has created a record sufficient to allow us to
evaluate whether its âno effectsâ determination is reasonable.
DOE proffers four arguments against being required to
undertake an environmental study. First, DOE contends that
no potential project-specific impacts are reasonably foresee-
able or caused by the NIETCs. DOE contends that the
NIETCs are not decisions to add transmission capacity to
solve the problems of congestion or to site transmission facili-
ties along preselected routes. DOE claims that these decisions
remain to be made by multiple independent actors, and given
âthe vast range of options available . . . it would be pure spec-
ulation to predict environmental impacts or assign them (as a
matter of causation) to the Designation Order.â DOE further
asserts that under § 216 its limited task was to âdetermine the
conditional availability of a federal forum for siting transmis-
sion projects,â and it would have been premature for DOE âto
evaluate the potential environmental impacts of new transmis-
sion facilities when deciding merely whether a federal forum
should be made available.â DOE also contends that even if
the NIETCs were certain to result in specific projects being
submitted to FERC, DOE was not required âto prejudge the
potential impacts of those projectsâ because a project-specific
NEPA review is required before a permit issues.
Second, DOE claims that the NIETCs have no foreseeable
programmatic effects. DOE admits that in some instances
NEPA may require review of âprogrammaticâ decisions that
prescribe future actions, even though project-specific NEPA
review will occur before a particular project is undertaken.31
31
DOE cites 40 C.F.R. § 1508.18(b), which reads:
(b) Federal actions tend to fall within one of the following cate-
gories:
(1) Adoption of official policy, such as rules, regulations, and
interpretations adopted pursuant to the Administrative Procedure
Act, 5 U.S.C. 551 et seq.; treaties and international conventions
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1959
Nonetheless, DOE maintains that the NIETCs are not pro-
grammatic decisions with reasonably-foreseeable future
effects because each NIETC âis not a plan to guide land man-
agement or energy policy decisions,â but âmerely makes
available a federal procedural remedy (i.e., a forum for the
consideration of interstate transmission lines), in the event
that FERC finds relevant State forums to be inadequate per
the standards set by Congress.â DOE maintains that the âaddi-
tion of a backstop federal forumâ does not mean that States
and FERC will approve a greater number of projects and it
âdoes not favor transmission solutions over non-transmission
alternatives . . . nor particular generation sources over others.â
DOE recognizes that it is tasked with choosing the geographic
boundaries of the National-Interest Corridors, but asserts that
petitioners have failed to show that these boundaries circum-
scribe relevant alternatives as they place no limits on State sit-
ing authorities.
Third, DOE denies that the NIETCs could have any
impacts on sensitive areas such as critical habitat for endan-
gered species, scenic rivers, wilderness areas, and historic
or agreements; formal documents establishing an agencyâs poli-
cies which will result in or substantially alter agency programs.
(2) Adoption of formal plans, such as official documents pre-
pared or approved by federal agencies which guide or prescribe
alternative uses of Federal resources, upon which future agency
actions will be based.
(3) Adoption of programs, such as a group of concerted actions
to implement a specific policy or plan; systematic and connected
agency decisions allocating agency resources to implement a spe-
cific statutory program or executive directive.
(4) Approval of specific projects, such as construction or man-
agement activities located in a defined geographic area. Projects
include actions approved by permit or other regulatory decision
as well as federal and federally assisted activities.
Id. DOE appears to recognize that NIETCs may be federal actions under
subsection (b)(3).
1960 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
sites. DOE points out that an EIS must be prepared whenever
substantial questions are raised about whether a specific proj-
ect may have a significant effect. DOE further asserts that
petitioners have the burden of showing that the potential
impacts to sensitive resources are a âreasonably foreseeableâ
result of the designations. DOE maintains that â[t]he very
breadth of these designations belies any suggestion that
impacts can be meaningfully evaluated at the designation
stage, even if it is assumed that the designation will prompt
additional transmission projects.â DOE disagrees with peti-
tionersâ claim that the inclusion of land within a corridor will
discourage conservation, opining that a NIETC âmight as
readily spur the expansion of parks and conservation ease-
ments within the Corridors, as interested parties seek to pro-
tect sensitive resources.â32 DOE further argues that claims of
potential habitat fragmentation within a corridor cannot be
meaningfully reviewed because of the many variables and
wide range of alternatives. DOE claims that any suggestion
that environmentally sensitive areas might be excluded from
the corridors âconfuses DOEâs threshold task (designating
areas with congestion problems) with the Statesâ and FERCâs
subsequent task (evaluating proposed solutions).â
Fourth, DOE argues that the NIETCs do not diminish any
legal protections because âCongress provided that nothing in
§ 216 alters federal environmental laws, including laws
requiring special authorization for use of federal lands or fed-
eral permits for impacting air and water resources.â The
NIETCs do not allow power companies âto run awayâ from
state and federal environmental and land use laws because
they, in themselves, have âno preemptive effect, and FERCâs
authority to preempt State law under § 216(b) is project-
specific and limited to circumstances enumerated by Con-
32
This argument exposes a weakness in DOEâs position. In essence,
DOE here reasons that because people see the Designation as threatening
conservation efforts, they will redouble their efforts to âprotect sensitive
resources.â
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1961
gress.â According to DOE, there are no âforeseeable adverse
effects from the mere threat of federal interventionâ because
âpotential acceleration of State proceedings does not dictate
the outcome of those proceedingsâ and because DOE does not
have âany discretion to alter the statutory time frames,â which
might preclude meaningful âreview of their potential effects.â
There may be merit to some of DOEâs arguments in terms
of limiting the scope of an EIS or in explaining why an EA
and not an EIS should be prepared, but they fail both as a mat-
ter of law and fact to justify DOEâs failure to undertake any
study of the potential environmental impacts.
DOEâs primary argument appears to be that because the
NIETCs do not approve any specific sites, they have no
meaningful environmental impact. This perspective fails to
appreciate that a decision to encourage, through a number of
incentives, the siting of transmission facilities in one munici-
pality rather than another has effects in both municipalities in
terms of the values of land and proposed and potential uses
of land. The effects may be difficult to measure and may be
determined ultimately to be too imprecise to influence the
Designation, but this is precisely the type of determination
that only can be intelligently made after the preparation of at
least an EA.
[20] Recognition of these consequences flowing from the
NIETCs defeats most of DOEâs reasons for not preparing an
EA or EIS. Without such a study, it is impossible to fairly
determine whether project-specific impacts are reasonably
foreseeable, whether there are âprogrammatic effects,â33 and
33
DOEâs argument that the Designation âis not a âprogrammaticâ deci-
sionâ because it âis not a plan to guide land management or energy policy
decisionsâ and âmerely makes available a federal procedural remedyâ
does not withstand scrutiny. This argument assumes that making available
a federal âproceduralâ remedy is not a plan to guide land management or
energy policy. Here, the converse is true. The federal remedy was created
as part of an energy plan. Moreover, the Designation is more than a âpro-
ceduralâ remedy because it also creates authority for federal action (by
FERC) where no such authority previously existed, and arms that author-
ity with the power of eminent domain.
1962 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
whether the Designation has any impact on sensitive areas.
Furthermore, the NIETCs do diminish legal protections at
least as to whether any particular geographic area should be
included in a corridor. The particular siting of a transmission
facility may be challenged before a State or FERC, but a chal-
lenge to a specific site cannot challenge the inclusion of the
area involved in the NIETCs by DOE. Thus, the alleged
impact of the NIETCsâ inclusion of particular areas as within
the corridors, and the exclusion of other areas, are subject to
review for environmental impacts at this time or not at all.
c. The relevance of the environmental study for the
West-wide Corridors
Any remaining doubt as to whether it is possible to con-
sider the environmental impacts of the NIETCs dissipates in
light of DOEâs preparation of a Programmatic Environmental
Impact Statement (âPEISâ) for its designation of the West-
wide Corridors for federal lands in eleven western states. See
U.S. Department of Energy et al., Programmatic Environmen-
tal Impact Statement, Designation of Energy Corridors on
Federal Land in the 11 Western States (DOE/EIS-0386), 2007
(hereinafter âPEISâ). A separate and distinct provision in the
EPAct, § 368 of the Energy Policy Act of 2005 (Pub. L. No.
109-58, § 368, 119 Stat. 727, codified at 42 U.S.C. § 15926),
directs federal land-management agencies to identify rights-
of-way across lands they administer to serve as energy corri-
dors. DOE points out that the statute provides that any âcorri-
dor designated under this section shall, at a minimum, specify
the centerline, width, and compatible uses of the corridor.â 42
U.S.C. § 15926(e). Together with the Department of Interior,
DOE prepared the required PEIS. See 42 U.S.C.
§ 15926(a)(2) (providing for the preparation of âany environ-
mental reviews that may be required to complete the designa-
tion of such corridorsâ).
The federal agencies issued the PEIS in October 2007. Two
aspects of the PEIS are of particular relevance to this case.
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1963
First, in response to the question âwhy conduct an environ-
mental review under NEPA and prepare a programmatic anal-
ysis,â the PEISâs executive summary states:
Section 368 requires the Agencies to conduct any
âenvironmental reviewsâ necessary to complete the
designation of Section 368 energy corridors. The
proposed designation of Section 368 energy corri-
dors would not result in any direct impacts on the
ground that may significantly affect the quality of
the human environment.
Nevertheless, the Agencies have decided to prepare
a PEIS to conduct a detailed environmental analysis
at the programmatic level and to integrate NEPA at
the earliest possible time.34
34
The executive summary goes on to state:
NEPA requires that federal agencies prepare a âdetailed state-
ment for major federal actions significantly affecting the quality
of the human environment. Here, the Agencies have concluded
that preparing a PEIS at this time to examine region-wide envi-
ronmental concerns is appropriate, even in the absence of on-the-
ground environmental impacts resulting from the designation.
Actual local environmental impacts must inevitably await site-
specific proposals and the required site-specific environmental
review.
...
The decision to prepare an EIS for a programmatic action such
as that described by Section 368 is supported by Council on
Environmental Quality (CEQ) regulations at Title 40, Part
1502.4(b), of the Code of Federal Regulations (40 C.F.R.
1502.4(b)), which states that âEnvironmental Impact Statements
may be prepared and are sometimes required for broad federal
action such as the adoption of new agency programs or regula-
tions (section 1508.8). Agencies shall prepare statements on
broad action so that they are relevant to policy and are timed to
coincide with meaningful points in agency planning and decision
making.â
1964 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
PEIS, supra, Executive Summary, at ES.8 (footnote omitted).
Second, after identifying an â âunrestrictedâ conceptual
West-wide network of energy transport paths,â the executive
summary explained:
Next, the locations of individual segments of the
conceptual network defined in Step 1 were examined
and revised to avoid major known environmental,
land use, and regulatory constraints (such as topogra-
phy, wilderness areas, cultural resources, military
test and training areas, and Tribal and state natural
and cultural resource areas, etc.). . . . The revision
resulted in a preliminary West-wide energy corridor
network that avoided private, state and Tribal lands,
many important known natural and cultural
resources, and many areas incompatible with energy
transport corridors because of regulatory or land use
constraints while meeting the requirements and
objectives of Section 368.
PEIS, supra, at ES.12.2.1.
[21] We recognize that the PEIS and the West-wide Desig-
nation were undertaken pursuant to a separate and distinct
provision of the EPAct. Nonetheless, the creation of the PEIS
and its impact on the resulting corridor designation is strong
evidence both that it is possible to determine the environmen-
tal impacts of a proposed energy corridor and that the study
of such environmental impacts may result in modifications of
a corridorâs boundaries. The West-wide Corridors Designa-
tion, like the NIETC Designation, did not approve any spe-
cific sites, but designated specific areas for sites. Nonetheless,
the lead agencies, including DOE, reshaped the corridors in
response to the PEIS to exclude certain sensitive lands. Cer-
tainly § 15926 contains a more specific requirement for a
study of environmental impacts than § 216, but DOEâs ability
to undertake a PEIS for West-wide Corridors, and to modify
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1965
the boundaries based on the PEIS, undermines its assertion
that it is not possible to evaluate the environmental impacts of
a NIETC.
3. DOE has not adequately documented its decision
[22] DOE also asserts that it has adequately documented
its decision not to undertake any review under NEPA. It
argues that similar to the situation in Northcoast, neither
NIETC is a âspecific proposal with environmental conse-
quences that can be meaningfully evaluated at this time.â 136
F.3d at 663 (internal quotations omitted). We doubt that a
NIETC is similar to the management guidelines at issue in
Northcoast, but even if we were to engage in this fiction, this
case does not contain the critical factual element present in
Northcoast: a record that supports the reasonableness of the
agencyâs decision not to prepare an EIS or EA. We cannot
accept DOEâs unsupported conclusion that its final agency
action that covers ten States and over a 100 million acres does
not, as a matter of law, have some environmental impact. See
Alaska Ctr., 189 F.3d at 859; The Steamboaters; 759 F.2d at
1393. If the smaller West-wide Corridors are worthy of a
PEIS, as detailed in the statementâs executive summary, then
a much larger NIETC is also presumptively worthy of an EA
or EIS. In any event, DOE has failed to present the documen-
tation necessary to allow us to determine that there are no
environmental impacts or that DOE took a âhard lookâ at the
environmental impacts.
4. The failure to undertake an environmental study is not
harmless error
Finally, DOE suggests, citing 40 C.F.R. § 1500.3, that even
if we were to determine that a formal EA was required to doc-
ument DOEâs âno effectsâ determination, DOEâs failure to do
so was, at most, harmless error. As noted in Section III C,
supra, following the issuance of the Supreme Courtâs opinion
in Sanders, 128 S. Ct. 1696, we place the burden on petition-
1966 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
ers to show that the failure to undertake an environmental
study is not harmless error. Here, even a cursory review of
petitionersâ contentions raises âsubstantial questions . . . as to
whether [the NIETCs] may cause significant degradation of
some human environmental factor.â Klamath Siskiyou Wild-
lands, 468 F.3d at 562 (internal citation omitted).35
[23] For example, petitioners note that the Southwest Cor-
ridor includes the Joshua Tree National Park and the Sonoran
Desert National Monument. It includes more than three mil-
lion acres of national wildlife refuge as well as national parks
and 57 state beaches, reserves and recreational areas. The
Mid-Atlantic Corridor encompasses four national forests, over
a million acres of national reserves, historic properties, and
environmentally sensitive lands. In light of the agenciesâ sen-
sitivity to environmental impacts in their creation of the West-
wide Corridors, we cannot conclude that the DOEâs failure to
undertake a study of the NIETCsâ environmental impacts con-
stitutes harmless error.
[24] In sum, NEPA requires that for all âmajor Federal
actions significantly affecting the quality of the human envi-
ronmentâ an agency must prepare a detailed statement on the
environmental impact of the action and any adverse environ-
mental effects. 42 U.S.C. § 4332(c). DOE did not prepare an
EIS or even an EA for its NIETC Designation. Its proffered
reasons for not doing so â the NIETC Designation is not a
major Federal action, NEPA review will take place in subse-
35
We note that DOEâs reference to a part of the regulation is no substi-
tute for its obligation to supply âa convincing statement of reasons why
potential effects are insignificant.â The Steamboaters, 759 F.2d at 1393.
The regulation does state, as DOE notes, that âany trivial violation of
[CEQ] regulations [does] not give rise to any independent cause of
action.â However it also provides that the âprovisions of the Act and of
these regulations must be read together as a whole in order to comply with
the spirit and letter of the law.â 40 C.F.R. § 1500.3. Here, the failure to
undertake any environmental review unsupported by a record that factu-
ally supports such a decision is not a âtrivialâ violation.
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1967
quent requests for specific sitings, and there are no significant
impacts from the Designation â are not persuasive as a mat-
ter of law and are not supported by the record. Accordingly,
because DOE has not shown that it has taken the requisite
âhard lookâ at the environmental consequences of the
NIETCs, we vacate the NIETC Designation and remand the
matter to DOE to prepare at least an EA to determine whether
there are any environmental impacts that significantly affect
the quality of human environment, and whether, if so, the
impacts warrant adjustments.36
VI. THE ENDANGERED SPECIES ACT AND THE
NATIONAL HISTORIC PRESERVATION ACT
Petitioners also argue that DOE violated the Endangered
Species Act (âESAâ), 16 U.S.C. § 1531, by failing to consult
with the Secretary of Interior pursuant to 16 U.S.C.
§ 1536(a)(2). We have recently stated that â[t]he threshold for
triggering the Endangered Species Act is relatively low; con-
sultation is required whenever a federal action âmay affect
listed species or critical habitat.â â Cal. ex rel. Lockyer v.
USDA, 575 F.3d 999, 1018 (2009) (quoting 50 C.F.R.
§ 402.14(a)) (emphasis added). DOE responds that petition-
ersâ arguments concerning the ESA âecho their NEPA argu-
ments.â
Petitioners also contend that DOE violated the National
Historical Preservation Act (âNHPAâ) by failing to comply
with 16 U.S.C. § 470f, which requires that it accept comments
from certain entities, including the Advisory Council on His-
toric Preservation (âACHPâ), prior to the approval of the
expenditure of any Federal funds on an undertaking that has
the potential to adversely affect historic properties. See 36
36
In Northwest Environmental Advocates v. EPA, we noted that when
the EPA acted outside its authority and failed to follow Congressâs clear
mandate, the appropriate remedy was to vacate that action. 537 F.3d 1006,
1026-27 (9th Cir. 2008).
1968 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
C.F.R. §§ 800.1(c); 800.3(a); 800.16(y). DOE argues that it
reasonably declined to initiate historic-preservation review
under NHPA, and further claims that it adequately responded
to the two letters it received from the ACHP.
As we hold that the Congestion Study and the NIETCs
Designation must be vacated and the matter remanded to the
DOE, we need not consider petitionersâ claims under the ESA
and NHPA. Should DOE on remand designate NIETCs in a
manner that petitioners believe violates either the ESA or
NHPA, they can then seek judicial review of those decisions.
VII. CHALLENGES TO SPECIFIC ASPECTS OF
THE NIETCs
Petitioners have raised numerous challenges to particular
aspects of the Mid-Atlantic Corridor and the Southwest Corri-
dor. However, as the Designation of these corridors is
vacated, these challenges are moot and we need not address
them. Petitioners will have the opportunity to present their
concerns to DOE in the proceedings on remand. We are confi-
dent that whatever actions DOE takes, the subsequent chal-
lenges to those actions (if any) will turn, at least in part, on
facts and arguments that are not before us now.
CONCLUSION
In the Energy Policy Act of 2005, Congress specifically
directed DOE to undertake a Congestion Study âin consulta-
tion with affected States.â 16 U.S.C. § 824p(a)(1). It further
directed that in undertaking this study and in designating any
national interest electric transmission corridors, DOE was to
comply with NEPA. We determine that DOE failed to consult
with the affected States prior to issuing its Congestion Study
and that this failure was prejudicial to the States. Accordingly,
the Congestion Study is vacated. We further find that DOEâs
statement that its designation of NIETCs âdoes not signifi-
cantly affect the quality of the human environmentâ is not
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1969
supported by sufficient evidence to show that DOE has taken
the requisite âhard lookâ at the environmental consequences.
See Kleppe v. Sierra Club, 427 U.S. at 410 n.21; California
ex rel. Lockyer, 575 F.3d at 1012. We further find that the
record does not allow us to conclude that the failure to take
a hard look at the environmental consequences was harmless.
Accordingly, the Designation of the NIETCs is vacated. In
light of our vacation of the Congestion Study and the NIETCs
Designation, we decline to consider the petitionersâ chal-
lenges (1) under the Endangered Species Act, (2) under the
National Historic Preservation Act, and (3) to specific aspects
of the Mid-Atlantic Corridor and the Southwest Corridor.
The petitions for review are GRANTED, the Congestion
Study and Designation of NIETCs are VACATED, and the
matter is REMANDED for further proceedings consistent
with this opinion.
IKUTA, Circuit Judge, dissenting:
This is a tale of two errors. First, the DOE erred by not con-
sulting with affected states at the threshold of a massive, year-
long, nationwide study of electric transmission congestion.
But this error was harmless. Petitioners have not shown that
DOEâs error prevented them from submitting information or
making arguments to DOE, nor have they shown that DOE
would have made a different decision absent the error. In
short, they have failed to offer even a scintilla of evidence to
establish prejudice. Under controlling Supreme Court prece-
dent, therefore, we must uphold DOEâs actions. Shinseki v.
Sanders, 129 S.Ct. 1696, 1704-06 (2009).
But here is where the second error comes in, namely, the
majorityâs ruling that DOE must complete the entire process
again even though its consultation error caused no harm.
Instead of recognizing that Sanders rejected the presumption
1970 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
of prejudice articulated in Riverbend Farms, Inc. v. Madigan,
958 F.2d 1479, 1487 (9th Cir. 1992), the majority employs
this discredited approach to nullify DOEâs efforts. In doing
so, the majority inflicts the only real injury in this saga. I
respectfully dissent.
I
Motivated by concerns about the reliability of the national
electricity system, Congress instructed DOE to conduct âa
study of electric transmission congestionâ and use it to âdes-
ignate any geographic area experiencing electric energy trans-
mission capacity constraints or congestion that adversely
affects consumers as a national interest electric transmission
corridor.â 16 U.S.C. § 824p(a)(1), (2). DOEâs efforts resulted
in the Congestion Study, 71 Fed. Reg. 45,047 (Aug. 8, 2006),
and the Designation Order, 72 Fed. Reg. 56,992 (Oct. 5,
2007), which examined congestion in over 150,000 miles of
transmission lines and designated over 119 million acres over
ten states as national interest electric transmission corridors
(NIETCs).
Although I agree with the majority that the DOE failed to
engage âin consultation with affected States,â § 824p, the
record shows that this failure neither impacted the outcome of
the designation process nor deprived petitioners of the
required opportunity to contribute all comments, facts, and
analysis that they wished to submit. The affected states had
actual notice that DOE was producing a congestion study that
would inform its decision to designate NIETCs, and all but
two of them actually participated and provided feedback by
directly interacting with DOE personnel at various in-person
conferences, one-on-one meetings, or conference calls, by
submitting written comments, or by some combination of
these various channels. Moreover, DOE considered and
responded to these comments when it issued its final study
and designation order, and no state now claims that it lacked
notice of DOEâs invitation to solicit comments or had specific
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1971
arguments or studies that it was unable to submit. In fact, the
petitioners do not (and cannot) demonstrate any prejudice
from DOEâs failure to engage in formal consultation: they
cannot show that the outcome would have been different had
they been formally consulted, nor can they point to any spe-
cific information or arguments that they were unable to sub-
mit because of the lack of consultation. Accordingly, as
explained in detail below, the statesâ failure to show any
actual harm attributable to the lack of consultation dooms
their claims under controlling Supreme Court precedent,
Sanders, 129 S. Ct. at 1704-06, and the majority errs in hold-
ing otherwise.
II
The Administrative Procedure Act (APA) informs federal
courts that, in reviewing agency actions, âdue account shall be
taken of the rule of prejudicial error.â 5 U.S.C. § 706. This
section requires courts to apply the harmless error rule in
reviewing challenges to administrative agency proceedings.
See, e.g., Natâl Assân of Home Builders v. Defenders of Wild-
life, 551 U.S. 644, 659-60 (2007) (âIn administrative law, as
in federal civil and criminal litigation, there is a harmless
error rule.â (quoting PDK Labs, Inc. v. U.S. DEA, 362 F.3d
786, 799 (D.C. Cir. 2004))). Although Section 706 of the
APA does not specify which party bears the burden of show-
ing that prejudice resulted from alleged agency error, the gen-
eral rule is that the party challenging an erroneous procedure
or ruling must carry the burden. See, e.g., NLRB v. Seine &
Line Fishermenâs Union of San Pedro, 374 F.2d 974, 981 (9th
Cir. 1967) (â â[T]he burden of showing that prejudice has
resultedâ is on the party claiming injury from the erroneous
rulings.â) (quoting Palmer v. Hoffman, 318 U.S. 109, 116
(1943)).
In a handful of cases involving alleged agency failures to
comply with notice, comment, and consultation requirements,
we departed from this long-standing rule. We justified this
1972 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
departure based on our concern that the burden for establish-
ing prejudice in such cases was too heavy. As we explained
in Riverbend Farms, âif the harmless error rule were to look
solely to result, an agency could always claim that it would
have adopted the same rule even if it had complied with APA
procedures.â 958 F.2d at 1487. Therefore, we shifted the bur-
den to the agency by presuming that an agencyâs failure to
provide notice or consultation was prejudicial. See Paulsen v.
Daniels, 413 F.3d 999, 1006 (9th Cir. 2005)) (presuming that
the Bureau of Prisonsâs failure to comply with the APAâs
notice and comment requirements was prejudicial and thus
shifting the burden to the agency to prove otherwise).
A
The Riverbend Farms approach is contrary to the Supreme
Courtâs recent decision in Sanders. In considering the ârule of
prejudicial errorâ in the agency context, the Supreme Court
repudiated the Federal Circuitâs mandatory presumption that
certain types of notice errors were per se prejudicial.1 129 S.
Ct. at 1704. Rejecting a rule that when an agency provides a
claimant with notice that is âdeficient in any respect,â the
1
Though Sanders addressed the harmless error standard in the context
of appeals from the United States Court of Appeals for Veterans Claims,
the Court made clear that its articulation of the harmless error rule applies
to our interpretation of the APA in all administrative contexts. Specifi-
cally, the Supreme Court stated that the requirement that the Veterans
Court âtake due account of the rule of prejudicial error,â 38 U.S.C.
§ 7261(b)(2), should be interpreted in the same manner as § 706 in the
APA. Sanders, 129 S. Ct. at 1704. Our sister circuits have complied with
this directive by interpreting Sanders as a clarification of the harmless
error standard in other agency contexts. See, e.g., Jicarilla Apache Nation
v. U.S. Dept. of Interior, 613 F.3d 1112, 1121 (D.C. Cir. 2010) (citing and
applying Sanders in a suit by an Indian tribe against the Department of the
Interior); In re Chapman, 595 F.3d 1330, 1338-40 (Fed. Cir. 2010) (citing
and applying Sanders in the patent context). Commentators have also
acknowledged Sandersâs effect on the harmless error rule in the adminis-
trative agency context. See Craig Smith, Taking âDue Accountâ of the
APAâs Prejudicial-Error Rule, 96 Va. L. Rev. 1727, 1740 (2010).
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1973
agency should presume that the error is prejudicial, id. at
1702, Sanders enunciated a number of general principles.
First, the Court prohibited reliance on a mandatory presump-
tion of prejudice because doing so would frustrate Congressâs
express preference for determining the harmlessness of an
error on a fact-specific, case-by-case basis. Id. at 1705. Sec-
ond, the Court held that âthe burden of showing that an error
is harmful normally falls upon the party attacking the agen-
cyâs determination.â Id. at 1706. Unless the circumstances of
the case âmake clear to the appellate judge that the ruling, if
erroneous, was harmful,â the party seeking reversal must
âmarshal[ ] the facts and evidenceâ to establish prejudice and
âexplain why the erroneous ruling caused harm.â Id. at 1706.
In this regard, the Court specifically disapproved the chal-
lengerâs argument for âthe creation of a special ruleâ that
placed âupon the agency the burden of proving that a notice
error did not cause harm.â Id. Third, the Court held that while
courts âmay sometimes make empirically based generaliza-
tions about what kinds of errors are likely, as a factual matter,
to prove harmful,â such generalizations must be based on
case-specific factors; they cannot be rigid, mandatory pre-
sumptions. Id. at 1707. The factors that inform such general-
izations are best left to the court that âsees sufficient case-
specific raw materialâ so as to draw such empirical conclu-
sions. Id.
Thus, Sanders instructs federal appellate courts that they
must take a case-by-case approach to determining whether an
agencyâs error, whether procedural or substantive, has a harm-
ful effect. Under Sanders, we may neither presume prejudice
nor place the burden of proof on the agency to disprove preju-
dice. The Supreme Courtâs direction to apply âthe same kind
of âharmless-errorâ rule that courts ordinarily apply in civil
cases,â id. at 1704, and to eschew presumptions in favor of a
case-specific approach is âclearly irreconcilableâ with the rule
that an agencyâs notice and comment failure âis harmless only
where the agencyâs mistake âclearly had no bearing on the
procedure used,â â Riverbend Farms, 958 F.2d at 1487 (quot-
1974 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
ing Sagebrush Rebellion, Inc. v. Hodel, 790 F.2d 760, 764-65
(9th Cir. 1986)). Therefore, our burden-shifting presumption
of prejudice has been superseded. See Miller v. Gammie, 335
F.3d 889, 892-93 (9th Cir. 2003) (en banc). Indeed, we are
âbound by the later and controlling authority, and [must]
reject the prior circuit opinion as having been effectively
overruled.â Id. at 893.
B
Despite the majorityâs insistence to the contrary, Maj. Op.
at 1946 n.21, the concern that animated our rule in the River-
bend Farms line of cases, namely that it would be impossible
for plaintiffs to establish prejudice as a result of procedural
errors, was unwarranted. As noted above, we based the
burden-shifting presumption of prejudice approach on the
concern that it would be virtually impossible to mount a suc-
cessful challenge to an agencyâs procedural error. This con-
clusion, in turn, was based on the assumption that a petitioner
could demonstrate prejudice only by showing that an agencyâs
outcome would have been different absent the error. River-
bend Farms, 958 F.2d at 1487. But as shown by our sister cir-
cuits, this assumption is not correct: a party can also show
prejudice by establishing that an agencyâs procedural error
âprevented specific facts or arguments from being presented
to an agency and entered into the administrative recordâ or
that the error prevented the petitioner from mounting a âcredi-
ble challengeâ to the agency action. Craig Smith, Taking
âDue Accountâ of the APAâs Prejudicial-Error Rule, 96 Va.
L. Rev. 1727, 1744, 1746 (2010) (citing cases). This ârecord-
basedâ approach, see id. at 1744, is consistent with the basic
agency law principle that ânotions of fairness and informed
administrative decisionmaking require that agency decisions
be made only after affording interested parties notice and an
opportunity to comment,â Chrysler Corp. v. Brown, 441 U.S.
281, 316 (1979); see also Sanders, 129 S.Ct. at 1707 (stating
that in evaluating an agencyâs error for harmlessness, a
reviewing court could consider âthe errorâs likely effects on
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1975
the perceived fairness, integrity, or public reputation of judi-
cial proceedings.â).
The D.C. Circuit has applied this record-based test in a
number of key cases. In Gerber v. Norton, 294 F.3d 173 (D.C.
Cir. 2002), for example, the U.S. Fish & Wildlife Service
issued an incidental take permit allowing real estate develop-
ers to build on an area inhabited by the endangered Delmarva
fox squirrel. Id. at 175-76. Although the Service published the
draft take permit, it erred by failing to publish a map of the
proposed mitigation site for the squirrels. Id. at 177, 179.
After a conservation group challenged this error, the D.C. Cir-
cuit held that the challengers successfully demonstrated preju-
dice by identifying three specific critiques of the permit that
they would have provided had they seen the map. Id. at 182.
In reaching this conclusion, the court articulated the rule that
in order to show prejudice, âa plaintiff must indicate with
âreasonable specificityâ what portions of the documents it
objects to and how it might have responded if given the
opportunity.â Id. at 384 (internal quotation marks omitted).
Similarly, in Owner-Operator Indep. Drivers Assân, Inc. v.
Fed. Motor Carrier Safety Admin., the D.C. Circuit held that
the petitioner satisfied its burden of establishing prejudice by
raising arguments that âamply demonstrate[d] that it would
have mounted a âcredible challengeâ had it been afforded an
opportunity to do so.â 494 F.3d 188, 202-03 (D.C. Cir. 2007).2
2
See also Am. Radio Relay League, Inc. v. FCC, 524 F.3d 227, 230,
237-38 (D.C. Cir. 2008) (holding that the FCCâs failure to comply with
notice-and-comment requirements was not harmless error because the
appellant showed that redacted portions of FCC reports âappear[ed] to
contain information in tension with the [Commissionâs] conclusionâ and
that it could offer commentary that would illuminate unaddressed
strengths and weaknesses of the FCCâs data (second alteration in original)
(internal quotation marks omitted)); U.S. Telecom Assân v. FCC, 400 F.3d
29, 41 (D.C. Cir. 2005) (holding that the challengers had failed to show
prejudice from the agencyâs failure to label its notice as âNotice of Pro-
posed Rulemakingâ where âthey cannot identify a single additional com-
ment that they would have made but for the labeling of the notice, nor any
other deficiency in the rulemaking process.â).
1976 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
Other circuits have likewise adopted the D.C. Circuitâs rule
for showing prejudice when the agency has made a procedural
error. See, e.g., Miami-Dade Cnty. v. EPA, 529 F.3d 1049,
1061 (11th Cir. 2008) (citing the D.C. Circuitâs decision in
Owner-Operator and holding that to show prejudice from the
lack of opportunity to comment on a proposed rule, the peti-
tioner âmust indicate with reasonable specificity the aspect of
the rule to which it objects and how it might have responded
if given the opportunityâ (internal quotation marks omitted));
Conservation Law Found. v. Evans, 360 F.3d 21, 29-30 (1st
Cir. 2004) (holding that agencyâs failure to demonstrate good
cause for waiving notice and comment requirement was harm-
less since conservation groups could not identify any com-
ment that they were prevented from making and that would
have made a difference in the result); Texas v. Lyng, 868 F.2d
795, 800 (5th Cir. 1989) (holding that agencyâs procedural
error was harmless because âappellants [did] not explain what
they would have said in response to the . . . reportâ and â[did]
not identify any new information they would have submitted
to the agency if given the opportunityâ).
Indeed, we have applied a similar principle on occasion.
See Safari Aviation, Inc. v. Garvey, 300 F.3d 1144, 1152 (9th
Cir. 2002) (concluding that agencyâs failure to consider com-
ments before promulgating a final rule was harmless because
the substance of the comments had been âextensively com-
mented on and discussed in previous rulemaking proceed-
ingsâ).
In sum, a challenger can carry its burden of showing preju-
dice from an agencyâs procedural error by demonstrating
âwith reasonable specificityâ that it could present specific
facts or arguments to an agency âthat may allow it to mount
a credible challenge,â or can point to key âomissions in data
and methodologyâ that makes the agencyâs decision unreli-
able. Am. Radio, 524 F.3d at 237-38 (internal quotation marks
omitted). Under this standard, the concern we expressed in
Riverbend Farm, that a challenger could never succeed in
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1977
showing prejudice due to a procedural error, is unwarranted,
and so is any presumption of prejudice based on that concern.
III
Rather than comply with Sanders in this case, the majority
applies Riverbend Farmâs superseded presumption of preju-
dice, holding that an error is not harmless unless it âclearly
had no bearing on the procedure used or the substance of [the]
decision reached.â Maj. Op. at 1939 (quoting Riverbend
Farms, 958 F.2d at 1487). Because this articulation of the
harmless error rule requires the agency to prove a negative,
that an error âclearly had no bearingâ on its procedure or deci-
sion, the test effectively presumes prejudice and shifts the
burden to the agency to prove otherwise. Indeed, this lan-
guage not only creates a presumption of prejudice, it also sug-
gests that a procedural error is prejudicial per se, because it
is doubtful that an agency could ever carry the heavy burden
of proving that a procedural error âclearly had no bearing on
the procedure used.â Id. (emphasis added). Building on this
language, the majority indicates that a failure to consult is per
se prejudicial because it affects âthe interactive process itself.â3
Maj. Op at 1942.
The majorityâs adherence to the presumption of prejudice
rejected by Sanders is demonstrated by its explanation of how
the petitioners in this case proved harm. First, according to the
majority, the affected states have shown harm because they
did not have an opportunity to consult before DOE finalized
its decision. Maj. Op. at 1943 (alteration in original). This is
nothing but a tautology (the affected states were harmed by
3
In fact, Riverbend Farms did not hold that the failure to engage in
notice and comment was per se prejudicial: it clarified that such a proce-
dural error is harmless where its purpose has been satisfied, id. at 1477,
and concluded that the agencyâs failure to comply with a notice and com-
ment requirement in that case was harmless. Id. at 1488. Thus, in indicat-
ing that a failure to consult with the states is per se prejudicial, the
majority goes beyond the holding in Riverbend Farms.
1978 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
DOEâs failure to consult because the DOE failed to consult
with them), and a presumption of prejudice by another name.4
The majorityâs further explanation that the affected states
have shown prejudice because DOE made a discretionary
decision, and when an agency makes a discretionary decision,
it might be influenced by consultation, is just another tautol-
ogy. Maj. Op. at 1944. Specifically, the majority claims that
DOE âadmit[ted] that its determinations and conclusions in
the Congestion Study were not decisions compelled by some
mathematical formulae, but important discretionary decisions
for which there was little guidance,â and that in such situa-
tions, â[t]he value of consulting with an agency before it
makes a decision is greatest.â Id. In other words, the states are
harmed by the failure to consult because they did not have the
opportunity to consult. Again, this is nothing more than a
restatement of the presumption that when an agency fails to
consult, it is per se prejudicial.
As a review of the record amply demonstrates, if the major-
ity had complied with Sanders, 129 S.Ct. at 1704-06, and
placed the burden of showing prejudice on the affected states,
it would have concluded that DOEâs error was harmless. First,
the affected states were well aware of DOEâs plans for the
study and NIETC designation. Six months before issuing its
congestion study, DOE published a Notice of Inquiry in the
Federal Register seeking comments and information relevant
to DOEâs plans for conducting the congestion study. Through
this notice, DOE requested âcomments on draft criteria for
gauging the suitability of geographic areas as NIETCs and
4
The majority also suggests that per Sanders, it could make an âempiri-
cally based generalization[ ]â that âa failure to consult prior to making a
discretionary decision, when such consultation is mandated by law, is the
type of error that is likely to prove harmful.â Maj. Op. at 1944 n.18 (quot-
ing Sanders, 129 S. Ct. at 1707). But the majority is not offering an âem-
pirically based generalization,â permitted by Sanders because the majority
provides no empirical evidence that a failure to consult caused any actual
harm. There is no such evidence in this case.
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1979
announce[d] a public technical conference concerning the
criteria for evaluation of candidate areas as NIETCs.â 71 Fed.
Reg. 5660, 5660 (Feb. 2, 2006). DOE specifically stated that
it would âconsider well-supported recommendations from
affected States and interested parties throughout the study
process regarding areas believed to merit urgent attention
from the Department.â Id. at 5661. The notice also contained
lists of âtransmission plans and studiesâ already under review
by DOE, and asked the public to send information about âex-
isting, specific transmission studies and other plans,â that
DOE should review. Id. at 5662.
Second, the states not only had the opportunity to comment
on how the study should be conducted, but they used the
opportunity to do so. Many states and state entities submitted
comments in response to DOEâs notice, including most of the
state petitioners in this case and entities from those states.
Specifically, representatives from the California Energy Com-
mission, California Public Utilities Commission, Arkansas
Public Service Commission, and Illinois Commerce Commis-
sion were conference panelists at a public technical confer-
ence where DOE discussed issues raised by commenters
regarding the ongoing Congestion Study. Conference partici-
pants also included officials from Iowa, New York, Califor-
nia, Illinois, Arkansas, Wyoming, Florida, Pennsylvania,
Michigan, Kentucky, New Jersey, Vermont, Idaho, New Mex-
ico, Utah, and the District of Columbia.
DOE also reached out to affected states through multiple
meetings with the National Association of Regulatory Utility
Commissioners (NARUC), a quasi-governmental organiza-
tion that includes representatives of all fifty states, the District
of Columbia, Puerto Rico, and the Virgin Islands, and whose
membership represents all of the state commissions responsi-
ble for economic and safety regulation of the retail operations
of utilities. Similarly, DOE participated in conference calls
with representatives from state entities, and met and corre-
sponded with the New York Public Service Commission and
1980 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
the Florida Public Service Commission, the Connecticut
Department of Public Utility Control, the New Jersey Board
of Public Utilities, the California Public Utilities Commission,
and the Pennsylvania Public Utilities Commission.
Given the undisputed fact that the affected states had ample
opportunity to provide their views to DOE, Maj. Op. at 1939,
which received and considered them,5 petitioners must show
some other basis for their claim that DOEâs failure to consult
was harmful. They have failed to carry this burden. Indeed,
the petitionersâ briefs barely address the issue of prejudice, let
alone marshal evidence showing what harm the petitioners
suffered, what specific information they would have provided
that was not already in the record, or how consultation would
have affected the outcome of DOEâs decisionmaking process.
The Western States assert merely that DOE failed to
respond to the request for consultation by five Arizona com-
missioners. Without more, this fails to show that the Western
States suffered any harm. And the Western States do not pro-
vide any further evidence of prejudice: they do not state how
consultation would have affected the outcome of DOEâs Con-
gestion Study or NIETC designation, nor do they explain with
âreasonable specificityâ what additional information or argu-
ments they could have made had they been consulted. See
Mkt. St. Ry. v. R.R. Commân of Cal., 324 U.S. 548, 561-62
(1945) (holding the Railroad Commissionâs error harmless âin
the absence of any showing of . . . prejudiceâ by the petition-
ers who made â[n]o contention . . . that the information was
erroneous or was misunderstood by the Commission, and no
contention . . . that the Company could have disproved it or
5
Indeed, the state petitioners concede that only two states, Virginia and
Arizona, did not submit comments or otherwise avail themselves of the
consultation opportunities afforded by DOE during its creation of the Con-
gestion Study. Neither state suggested that it did not have actual notice of
DOEâs Congestion Study, and neither state alleged it had new information
that it would have presented had it been consulted by DOE.
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1981
explained away its effect for the purpose for which the Com-
mission used itâ). Having failed to show prejudice, the West-
ern States cannot prevail on their claim merely because DOE
made a technical error.
The Eastern States similarly fail to show prejudice. In
attempting to do so, they raise only a single argument, namely
that DOE incorrectly interpreted data âas to the location and
magnitude of congestion in New York.â The Eastern States
argue that DOEâs âincorrect and flawedâ documentation and
interpretation of data could have been prevented if DOE had
consulted with the New York Public Service Commission
(NYSPC), which could have identified discrepancies between
data from the Congestion Study and the 2005 State of the
Market Report prepared by the New York Independent Sys-
tem Operator (NYISO).
This argument is belied by the record. After the Congestion
Study was complete, NYSPC informed DOE about alleged
material discrepancies between DOEâs study and the 2005
report produced by NYISO. In response, DOE explained that
the discrepancies and reporting errors identified by New York
âdid not affect the analysis and findings of the Congestion
Study.â 72 Fed. Reg. 25,838, 25,859 (May 7, 2007). Specifi-
cally, DOE explained that âNYISO market data on congestion
are not directly comparable to the Congestion Studyâs simula-
tion resultsâ because the congestion study simulations reflect
forward-looking data while NYISO relied on real-time con-
gestion data. Id. at 25,858. In addition, DOE explained, its
Congestion Study simulations reflected NYISOâs âplanningâ
data, whereas NYISOâs report was based on its âoperationalâ
data. Id. Finally, according to the DOE, the Congestion Study
accounted for new generation capacity that was added after
NYISOâs study, and considered future capacity additions as
well. Id. at 25,859.
Because DOE considered the Eastern Statesâ concerns and
offered a reasonable explanation for the discrepancies identi-
1982 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
fied by the NYSPC, the Eastern States have failed to show
that had DOE consulted with New York, DOE would have
interpreted this data differently or reached a different deci-
sion. Nor do the Eastern States identify any additional facts
and information they would have supplied, or different argu-
ments they would have made, had they been consulted. There-
fore, the Eastern States have not carried their burden of
showing that they were prejudiced by DOEâs failure to con-
sult.
In holding that DOEâs failure to consult with the states was
per se prejudicial, despite the statesâ failure to demonstrate
any harm, the majority employs the sort of mandatory pre-
sumption rejected in Sanders. The majority attempts to distin-
guish Sanders on the ground that it involved a notice error
rather than a consultation error, see Maj. Op. at 1939, assert-
ing that a notice error is harmful only if it affects the outcome
of agency decisionmaking, while a consultation error is harm-
ful in itself because Congress intended for there to be consul-
tation, and a consultation error deprives parties of the
opportunity to consult. Maj. Op. at 1939. But Sandersâs preju-
dicial error principles cannot be so confined. In considering
whether an error is harmless, there is no principled basis for
distinguishing among any of the steps an agency must take
before reaching its final decision, whether the step involves
consultation, notice and comment, or merely notice. While an
error in fulfilling any of these steps necessarily affects the
decisionmaking process, a plaintiff must prove that such an
error actually caused harm. Because there is no evidence of
prejudice beyond the mere fact that DOE failed to consult the
affected states, nor any basis for the majorityâs assertion that
there is âsubstantial doubt as to whether DOE would have
made the same findings had it consulted with the affected
States,â Maj. Op. at 1944 (quoting Kurzon v. United States
Postal Service, 539 F.2d 788 (1st Cir. 1976)), the majority
errs in invalidating the DOEâs Congestion Study and Designa-
tion Order.
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1983
IV
The majority compounds its error by reaching out to dis-
cuss DOEâs decision not to prepare NEPA documentation
regarding the potential environmental impacts of the Designa-
tion Order. Maj. Op. at 1961-62. Because the majority vacates
the Designation Order, its discussion of this issue is entirely
superfluous. Worse, the majority is entirely wrong in conclud-
ing that DOEâs decision is a harmful error. In fact, DOE ade-
quately complied with NEPA, 42 U.S.C. § 4332(2)(C), by
documenting its determination that no environmental impact
statement (EIS) was required in the Designation Order.
The Supreme Court has set a practical limit to NEPAâs
requirement that federal agencies document the environmental
impact of proposed programs. Where âit is impossible to pre-
dictâ the level of activity that will occur in a region, it is âim-
possible to analyze the environmental consequences and the
resource commitments involved in, and the alternatives to,
such activity.â Kleppe v. Sierra Club, 427 U.S. 390, 402
(1976). Under such circumstances, any attempt to prepare an
environmental analysis âwould be little more than a study . . .
containing estimates of potential development and attendant
environmental consequences.â Id. In other words, unless there
is a plan for development that defines âfairly precisely the
scope and limits of the proposed development of the region,â
there is âno factual predicate for the production of an environ-
mental impact statement of the type envisioned by NEPA.â
Id.
Applying such a practical common sense limitation, we
have likewise held that an EIS was not necessary for an action
plan prepared by the Forest Service because it was a broad
program lacking any identifiable concrete effects, did not call
for specific activities with a direct impact on a particular site,
did not propose site specific activity, and did not call for spe-
cific actions directly impacting the physical environment.
Northcoast Envtl. Ctr. v. Glickman, 136 F.3d 660, 668-70 (9th
1984 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
Cir. 1998). The Fourth Circuit adopted a similar approach in
deciding that FERC was not required to prepare an environ-
mental assessment (EA) or EIS in connection with its promul-
gation of regulations governing the process for issuing
permits for the construction or modification of electric trans-
mission facilities in areas designated as national interest corri-
dors. Piedmont Envtl. Council v. FERC, 558 F.3d 304, 316-17
(4th Cir. 2009). As the Fourth Circuit explained, such envi-
ronmental planning would have no practical value, because
FERC could not identify projects that are likely to be sited
and permitted, and thus did not have âinformation about the
ultimate geographic footprint of the permitting program.â Id.
at 316. In the absence of such information, FERC could not
present âa credible forward look [that] would . . . be a useful
tool for basic program planning.â Id. In other words, NEPA
does not require a futile act: if it is not possible to connect a
federal plan to any particular action on the ground, there is no
purpose in preparing an environmental study about the effects
of that plan.
The Supreme Courtâs common sense rule applies to DOEâs
Designation Order because the order cannot be connected to
any particular action on the ground. In explaining why it can-
not meaningfully examine environmental impacts of the des-
ignation of NIETCs, the Designation Order notes, âNational
Corridor designations have no environmental impactâ because
â[t]hey are only designations of geographic areas in which
DOE has identified electric congestion or constraint prob-
lems.â Other than identifying the 119 million acres where
congestion is a problem, the DOE âcannot determine the num-
ber, size, or location of new transmission facilities that might
be permitted within the National Corridors.â Nor does DOE
âknow whether any new electricity generation, or what type
of generation, will develop in the future.â Further, DOE âhas
no control over how and when any such development might
occur and therefore cannot predict or estimate its impacts.â
Likewise, the siting decisions that may be made by FERC and
various state agencies in the future are âtoo attenuatedâ and
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1985
âspeculativeâ to be meaningfully evaluated at the designation
stage.
Ultimately, because â[c]umulative impacts are speculativeâ
and DOE cannot predict the level of activity that will occur
anywhere in the 119 million acres it has designated, it cannot
analyze the possible impacts, resource commitments, or alter-
natives. As in Kleppe, any environmental report would âbe lit-
tle more than a study . . . containing estimates of potential
development and attendant environmental consequences.â 427
U.S. at 402. Such environmental planning would have no
practical value; it could not present âa credible forward look
that would be a useful tool for basic program planning.â Pied-
mont Envtl. Council, 558 F.3d at 316.
The majority points to the efforts by DOE and Bureau of
Land Management (BLM) to prepare a Programmatic EIS for
a much smaller project that involved the designation of
energy corridors solely on federal land. Maj. Op. at 1958-59.
Rather than serve as evidence that DOE could have prepared
a meaningful environmental report in this case, as the major-
ity claims, the PEIS in fact documents the opposite. The PEIS
admits up front that the agencies cannot make any predictions
about âwhether or where future applicants would seek to site
their projects,â or about what sort of project might âbe pro-
posed at a particular location (e.g., an underground pipeline
as opposed to an aboveground transmission line).â Nor can
the agencies predict whether any potential future project
âwould involve electricity, gas, hydrogen, or oil energy trans-
port systems.â At this level of generality, it is not surprising
that the agencies concluded that land use impacts from desig-
nating corridors on federal land are substantially the same as
the land use impacts from not designating such corridors. See
Depât of Energy et al., Programmatic Environmental Impact
Statement, Designation of Energy Corridors on Federal land
in the 11 Western States, S-25 (Nov. 2008). The agencies are
even blunter in their consideration of the effect the corridor
designation project has on endangered species: âwithout
1986 CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY
knowing the specifics of when and where a project would
occur within a corridor,â or what such a project would entail,
there was âno credible basisâ on which to base a biological
assessment.
To the extent that an EA was required under DOEâs regula-
tions, 40 C.F.R. § 1501.4(b), DOE satisfied that requirement
in the Designation Order itself. An EA is âa concise public
documentâ that provides an agency âsufficient evidence and
analysis for determining whether to prepare an environmental
impact statement or a finding of no significant impact.â 40
C.F.R. § 1508.9(a)(1). As explained above, the Designation
Order provided a reasoned discussion of the relevant factors
and concluded that an EIS was not required because DOE
could not meaningfully evaluate environmental impacts at this
juncture. In light of DOEâs reasoned statements, the majority
errs in suggesting that DOE did not âadequately explain its
decision.â Maj. Op. at 1950 (quoting Alaska Ctr. for Envât v.
U.S. Forest Serv., 189 F.3d 851, 859 (9th Cir. 1999)).6 Again,
the majority departs from the Supreme Courtâs direction that
courts should not function as âcitadels of technicalityâ that
automatically reverse agency action for errors that have no
actual impact. Sanders, 129 S. Ct. at 1705 (quoting Kotteakos,
328 U.S. at 759); see also McDonough Power Equip., Inc. v.
Greenwood, 464 U.S. 548, 553 (1984).
V
Instead of taking the common sense approach mandated by
the Supreme Court in reviewing agency action, the majority
here invalidates two important studies because of a technical
6
Though the majority does not reach the statesâ arguments that DOE
violated the Endangered Species Act, 16 U.S.C. § 1536(a)(2), and the
National Historical Preservation Act (NHPA), 16 U.S.C. § 470f , I would
also hold that DOEâs statutory obligations were not triggered under either
statute because the effects of the Designation Order on endangered spe-
cies, critical habitats, and historic properties were too speculative.
CALIFORNIA WILDERNESS v. U.S. DEPARTMENT OF ENERGY 1987
procedural error that had no adverse effect. The majority takes
this step in reliance on precedent that has been superseded by
the Supreme Court. Its unnecessary exposition of federal
environmental law is equally flawed, ignoring both control-
ling Supreme Court precedent and common sense. I respect-
fully dissent.
Case Information
- Court
- 9th Cir.
- Decision Date
- February 1, 2011
- Status
- Precedential