On January 14, 2025, the U.S. Court of Appeals for the D.C. Circuit (“D.C. Circuit”) held that FERC complied with the National Environmental Policy Act (“NEPA”) in approving the surrender of a hydroelectric project license. The court found that FERC had adequately considered the alternative of dam removal and determined that keeping the dams in place outweighed any potential benefits to recreation, fisheries, and other environmental concerns. The case, American Whitewater v. FERC, involved a challenge to FERC’s license surrender decision regarding the Somersworth Hydroelectric Project (“Project”) on the Salmon Falls River, which spans the border between New Hampshire and Maine.

On March 29, 2019, Aclara Meters LLC (“Aclara”), the then-licensee for the Project, filed an application to surrender the Project license and proposed to leave the dams in place. FERC prepared an environmental assessment (“EA”) which concluded that, among other things, leaving the dams in place would have a negligible impact on recreation opportunities because the Project is in an industrial area, an upstream bridge prevents boaters from accessing the Project dams, and summer water flows are too low to support boating in the bypass reach. FERC also explained that two other FERC-licensed projects located downstream of the Project blocked fish passage and that these downstream projects were more likely to continue using trap-and-truck methods for fish passage rather than installing fishways. On May 22, 2023, FERC approved the surrender, explaining that the benefits to dam removal were uncertain for the reasons stated in the EA. FERC further concluded that dam removal was not a reasonable alternative because two municipalities relied on the impoundment for critical uses, and that these uses outweighed the uncertain benefits to dam removal.

On June 20, 2023, American Whitewater, a conservation organization, sought rehearing of FERC’s order and argued that FERC acted arbitrarily and capriciously by failing to take the NEPA-required “hard look” at dam removal alternatives. FERC issued a notice of denial of rehearing by operation of law on July 21, 2023. In a later order addressing arguments raised on rehearing, FERC upheld its order on surrender, finding that the benefits provided by keeping the dams in place far outweigh the speculative benefits to recreation and fish passage of dam removal. American Whitewater petitioned the D.C. Circuit for review on October 23, 2023.

On appeal, American Whitewater claimed FERC improperly excluded the dam removal alternative from detailed consideration under NEPA. The court disagreed, instead finding FERC “reasonably determined that dam removal was unfeasible because local municipalities relied on the reservoir for key water needs.” Even if dam removal were feasible, the court found FERC appropriately considered dam removal as an alternative to surrender and rejected the dam removal alternative given the stated benefits to local municipalities in keeping the dams in place. The court explained that an EA only requires a brief discussion of reasonable alternatives and that NEPA does not require agencies to elevate environmental concerns over other appropriate considerations.

The court also addressed a jurisdictional argument raised by Aclara, who intervened in the proceeding. Aclara argued that the court lacked jurisdiction to review American Whitewater’s petition under FPA section 313 on the basis that American Whitewater failed to file its petition for review within 60 days of FERC’s automatic notice of denial of rehearing.  Instead, American Whitewater filed its petition after FERC issued its merits order addressing arguments raised on rehearing. The court held that American Whitewater’s petition was timely, finding that Aclara’s reading of the section 313 would lead to an “unreasonable result.”

A copy of the D.C. Circuit’s opinion, issued in Docket No. 23-1291, can be found here.