On Friday, June 17, the U.S. Court of Appeals for the District of Columbia Circuit (D.C. Circuit) upheld a decision by the Federal Energy Regulatory Commission (FERC) in Turlock Irrigation District et al. v. Federal Energy Regulatory Commission et al. ruling that the California State Water Resources Control Board (Water Board) did not waive its authority to issue permits in connection with FERC’s licensing of the Don Pedro and La Grange hydroelectric plants (the Projects) in central California under Section 401 of the Clean Water Act. Under this section, states may impose conditions on projects that result in the discharge into waters of the United States through a water quality certification. But if a state fails to timely act on a water quality application, it waives its authority to do so.
Here, the Water Board rejected the Projects’ certification applications without prejudice in 2019 and 2020, saying that the applications were premature because federal and state environmental reviews had not been completed. Eventually, after the Projects withdrew their applications, the Water Board granted the certificates and imposed a number of additional conditions. FERC subsequently denied the Projects’ petition seeking a declaration that the Water Board had waived its Section 401 authority to impose such conditions. In upholding FERC’s decision, the D.C. Circuit ruled that the Water Board’s denial of the applications without prejudice within one year of submission was sufficient to avoid waiver. The Projects argued that in upholding FERC’s decision, states could delay action on a certification application indefinitely by dismissing applications without prejudice year after year. However, the court found no merit to this argument because in the case at issue, the record contained no evidence that the Water Board’s dismissal was unsupported by substantive conclusions.