Commissioner James Danly Statement
July 30, 2021
Project Nos. 67-136, 120-030, 2085-022, 2086-041, 2174-019, 2175-023
Today’s order finds that investments made by Southern California Edison Company (SoCal Edison) over the terms of its existing licenses meet the criteria set forth in section 36(b)(2) of the Federal Power Act (FPA).[1] Congress recently added FPA section 36 to require the Commission to consider “project-related investments” made by the licensee over the existing license term when determining the length of a new license term.[2] I dissent in part from today’s order because it fails to articulate a satisfactory explanation for how SoCal Edison’s investments in ancillary facilities and Occupational Safety and Health Act (OSHA) compliance-related investments are “project-related,” thereby running afoul of the Administrative Procedure Act (APA).[3]
FPA section 36(b)(2) sets forth the criteria for investments made by the licensee over the term of the existing license to be considered “project-related.” For certain of SoCal Edison’s investments, the majority explains how those investments met the criteria.[4] However, for SoCal Edison’s investments in ancillary facilities and OSHA-related investments, the majority cursorily describes these investments by conclusory statements without reference to the filing or any explanation as to why they meet the criteria and merely determines that “the investments in ancillary facilities and safety-related investments meet the criteria set forth in section 36(b)(2) . . . .”[5] Conclusions offered without any supporting reasoning do not constitute reasoned decision making. Surely, some analysis is called for.
I am also particularly troubled by the fact that SoCal Edison’s investments in ancillary facilities include the rebuilding of an administrative office.[6] Just two years ago, the Commission stated in a similar proceeding that “we are not certain that Congress intended for us to consider ancillary facilities, such as office buildings, that do not have a demonstrated direct hydropower purpose, may not be necessary for project operation, and may have other uses.”[7] In addition, in response to SoCal Edison’s earlier request, a Commission-delegated order stated: “FPA section 36(b)(2)(A) requires the Commission to consider investments made by the licensee over the term of the existing license that resulted in ‘safety improvements.’ However, this would not include safety upgrades undertaken to comply with OSHA regulations or standards.”[8] Given these orders, one would expect the majority to offer some explanation as to how SoCal Edison’s investments in ancillary facilities and OSHA-related investments are “project related.”
This is a relatively new section of the statute, and the Commission is naturally feeling its way through uncharted territory. But that is all the more reason to offer thoughtful, reasoned decisions. Every choice we make early in the implementation of a new section of the statute serves as particularly important precedent for the cases that follow and our obligations under the APA, while always mandatory, are particularly important in proceedings such as this.
For these reasons, I respectfully dissent in part.
[1] S. Cal. Edison Co., 176 FERC ¶ 61,061 (2021).
[2] 16 U.S.C. § 823g(a).
[3] 5 U.S.C. § 706; Motor Vehicle Mfrs. Ass’n of U.S., Inc. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 30 (1983). See also Elec. Consumers Res. Council v. FERC, 747 F.2d 1511, 1513-14 (D.C. Cir. 1984) (“We defer to the agency’s expertise . . . so long as its decision is supported by ‘substantial evidence’ in the record and reached by ‘reasoned decision-making,’ including an examination of the relevant data and a reasoned explanation supported by a stated connection between the facts found and the choice made.”) (citing Burlington Truck Lines v. United States, 371 U.S. 156, 168 (1962); Memphis Light, Gas & Water Div. v. FPC, 504 F.2d 225, 230 (D.C. Cir. 1974); 16 U.S.C. § 825l (1982)).
[4] S. Cal. Edison Co., 176 FERC ¶ 61,061 at P 26 (“[SoCal Edison’s] investments to repair, refurbish, and modernize wildfire-damaged project facilities improved the safety and operational reliability of the Big Creek projects and included modernization and environmental measures.”) (emphasis added).
[5] Id. P 48.
[6] Id. P 30.
[7] Pub. Util. Dist. No. 1 of Chelan Cty., 168 FERC ¶ 61,083, at P 10 (2019) (unanimous).
[8] Big Creek Nos. 2A, 8, & Eastwood Hydroelectric Project, 174 FERC ¶ 62,101, at P 18 (2021) (internal citation omitted).