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her decision on which industries will participate in the project -- which she has identified as a top priority for
the agency -- on "any hard and fast criteria, but more on her gut feeling," the EPA source says.
A source with the Printing Industries of America (PIA) characterizes the initial meeting with the agency
as "very good," noting that printers are definitely on "the A-list" for project selection. The industry would like
to participate because of the "dramatic departure" it will take from traditional ways of being regulated, the
source asserts. There is always the fear of more stringent regulations, but in some ways, "I can't conceive of
being regulated any more heavily than we already are -- we have hit critical mass," the source says.
One bonus to having the printing industry as a guinea pig for the green sectors scheme is that printers are
already heavily involved in a pollution prevention project led by the Environmental Defense Fund, says an
agency source. While existing efforts to decrease impacts on the environment "can't hurt" any industry's
chances of being chosen, it is not a prerequisite, the EPA source says.
From the printing industry perspective, the Common Sense Initiative is an opportunity to make
current regulations more manageable. "It is almost impossible to be flexible when you must meet every EPA
requirement, and we hope some flexibility will be built in during the first year of the project," the PIA source
notes. Another incentive for participating in the initiative, this source says, is that it is expected to use
multimedia regulations. "We have always preferred emissions be regulated in a multimedia fashion, but this
has been the single most difficult challenge for EPA," the source adds.
The American Automobile Manufacturing Association (AAMA), which is also already involved in a
pollution prevention project through the Michigan Department of Natural Resources, met with Browner earlier
this month. "People in the industry are looking at participating in the initiative as an opportunity to be pro-
actively involved, and as a way to improve the regulatory process," an AAMA source notes. EPA is reserving
its decision on the auto industry until after Browner meets with the individual companies -- General Motors,
Ford and Chrysler -- the source says.
One of Browner's most significant issues for the project is ensuring that it will produce "some tangible
results," an Office of Water source says. "Browner is very committed to implementing the results," the source
comments, adding that the Common Sense Initiative will lead to long-term benefits, and less expensive
methods of cleaning up the environment.
In Light Of Supreme Court Ruling On Water Quantity
STATE MAY HALT PIPELINE PROJECT THROUGH CWA 401 CERTIFICATION.--., In an example of the far-reaching implications of a recent Supreme Court decision that upheld state rights
to link water quantity with water quality impacts, the state of North Carolina may be able to use the ruling to
block a highly-contentious proposed pipeline project in the adjacent state of Virginia. North Carolina has been
unsuccessfully contesting the project through an interstate review provision under the Coastal Zone
Management Act. But the state may . now be able to use its water quality certification authority under Clean
Water Act section 401 to oppose the project for its negative impact on the waterway's designated uses.
The issue involves the May 31 Supreme Court'decision in Public Utility District (PUD) No. I of
Jefferson County v. State of Washington, " Department of Ecology, Department of Fisheries, and Department of
Wildlife (No. 92-1911) in which the high court affirmed that states have extensive rights to regulate their
waters beyond minimum federal requirements, -including the right to consider water quantity impacts Jon water
quality (Water Policy Report, June 8, p3). In essence, the high court ruled that a state can impose minimum
streamflow. requirements when granting CWA section 401 certification for federally licensed projects., _
`North Carolina is strongly. objecting to a plan by:Virginia Beach, Va. to divert up to 60 million gallons of
water a day via pipeline from Lake Gaston, which straddles-the North Carolina/Virgmia border. North,..
Carolina contends that the withdrawal will have devastating impacts on the lake, Roanoke River, and striped
Bass which migrate up, th e river to 'spawn Virginia Beach .has argued that the pipeline project is_ the only
reasonable alternative =for alleviatmg its severe drinking water shortage
The Commerce Department, which -has jurisdiction over CZMA projects, recently overturned North
Carolina's objection to the project filed under the CZMA, presumably. clearing one of the last hurdles for
federal approval of the project. While the legality of interstate consistency reviews under the.CZMA, is.still
the subject of federal court action, North Carolina may now. have the opportunity to block the project using
"section 401 of the CWA. continued on n
ext page
WATER POLICY REPORT - June 22, 1994 29
Wa ter Rights
1' In a May 31 administrative motion to the Federal Energy' Regulatory Commission (FERC), North
Carolina asks the commission, to withhold processing of Virginia Beach's project application until final
resolution of the CZMA dispute. Moreover, North Carolina warns FERC that it cannot approve the project
application until North Carolina issues or waives a CWA section 401 water quality certification.
o .
'While the state of Virginia issued 401 certification in 1983 in connection 'with a Corps of Engineers'
dredge and fill permit for construction of the pipeline, North Carolina argues in its brief that 401 certification
is also needed for the discharge that "originates in North Carolina." Specifically, while the actual pipeline
project will be located entirely in Virginia, the project will be a federally licensed addition to an existing
Virginia Power Co. hydropower project located in part in North Carolina. Because this hydropower project
was "originally licensed years before the [CWA] became law, North Carolina has never before had the
opportunity to certify the project's water quality," states the brief. "Now, with Virginia Power seeking
authority for activities which will directly affect the project's water quality, North Carolina has the right and
the duty to ensure that its water quality standards are not violated."
With the Supreme Court affirmation of strong state rights to include water quantity conditions in 401
certification, North Carolina could conceivably require strong enough water flows in its 401 certification to
make the pipeline project unfeasible. However, Virginia Beach and Virginia Power will. likely challenge North
Carolina's right to issue 401 certification for the project. Nevertheless, North Carolina will undoubtedly be
able to issue 401 certification during the relicensing of Virginia Power Co.'s hydropower project scheduled
for the year 2001. In fact, North Carolina warns FERC that "there is significant overlap between the issues
involved in [the pipeline] proceedings and the issues which will be at the forefront of the relicensing
proceedings."
A North Carolina official says the state has always taken the position that water quantity conditions could
be considered within the context of 401 certification, adding that the Supreme Court has "removed any
question" of states' rights to regulate water quantity. This source also says water quantity considerations will
be an important factor of 401 certification for the pipeline project, noting that North Carolina has consistently
argued that reduced water flows from Lake Gaston would cause severe environmental problems downstream
on the Roanoke River.
A Virginia Beach official says the May 31 brief to FERC represents the first time the issue of North
Carolina's CWA section 401 authority has been raised. This source says city attorneys are reviewing the issue,
and will likely submit a response to North Carolina's motion to FERC this week.
. ...
Under Federal Power Act
COURT .TO RULE ON GROWING CRITICAL QUESTION OF DECOMMISSIONING DAMS
Afederal. court will determine whether the Federal Energy Regulatory Commission (FERC) has the
authority -to decommission hydropower projects, an important issue for 'environmentalists as water quantity is
increasingly being viewed as an area of pollution that affects habitats and ecosystems.' The outcome of the
case is crucial for the" hydropower industry, which contends that the Federal Power Act 0A). does not-allow
for decommissioning . `projects:
The' issue is especially' pertinent this year, 'as more than 100 hydroPower projects 'are currently up for
federal relicensing by"FERC which has jurisdiction over hydropower operations. The relicensing process has
focused significant attention on water qualityimpacts of hydropower projects, ' and has led environmentalists
to call for' the decommissioning and'removal of several dams To date, no federally licensed dam has ever
been removed `without the acquiescence 6f the licensee.
The court case' Alabama Power 'Corp, v. `FERC'(no.'94 1399, in the U S.'Court of Appeals for the D.C.
Circuevolved out of a "reopener'clause " attached to two: hydropower license renewals issued to Alabama
Power Corp. February. . .: -, , ...,,_ ...:. ,..
Power . i , m . The clause,.grants FERC the;authonty to require the company to decommission the
two projects' if FERC determines' at some- future time" that it has the statutory authority , and if "project-.
specific circumstances warrant decommissioning
The reopener clause stems from ERC's Sept. 15;'1993 notice of m ui '; on whether "it should
consider dam`decommissiohing' as `part of its statutory authority`under the'FPA.- ERC i"s'not yet proposing
regulations on decommissioning, but has included the reopener clause in all licenses issued this year in order
30 WATER POLICY REPORT -'June 22, 1994

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