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U.S. Supreme Court

Vermont Yankee Nuclear Power Corp. v. NRDC, 435 U.S. 519 (1978)

Vermont Yankee Nuclear Power Corp. v.

Natural Resources Defense Council, Inc.

No. 76-419

Argued November 28, 1977

Decided April 3, 1978*

435 U.S. 519


In No. 76-419, after extensive hearings before the Atomic Safety and Licensing Board (Licensing Board) and over respondents' objections, the Atomic Energy Commission (AEC) granted petitioner Vermont Yankee Nuclear Power Corp. a license to operate a nuclear power plant, and this ruling was affirmed by the Atomic Safety and Licensing Appeal Board (Appeal Board). Subsequently, the AEC, specifically referring to the Appeal Board's decision, instituted rulemaking proceedings to deal with the question of considering environmental effects associated with the uranium fuel cycle in the individual cost-benefit analyses for light-watercooled nuclear power reactors. In these proceedings, the Licensing Board was not to use full formal adjudicatory procedures. Eventually, as a result of these rulemaking proceedings, the AEC issued a so-called fuel cycle rule. At the same time, the AEC approved the procedures used at the hearing; indicated that the record, including the Environmental Survey, provided an adequate data base for the rule adopted; and ruled that, to the extent the rule differed from the Appeal Board's decision, such decision had no further precedential significance, but that, since the environmental effects of the uranium fuel cycle had been shown to be relatively insignificant, it was unnecessary to apply the rule to Vermont Yankee's environmental reports submitted prior to the rule's effective date or to the environmental statements circulated for comment prior to such date. Respondents appealed from both the AEC's adoption of the fuel cycle rule and its decision to grant Vermont Yankee's license. With respect to the license, the Court of Appeals first ruled that, in the absence of effective rulemaking proceedings, the AEC must deal with the environmental impact of fuel reprocessing and disposal in individual licensing proceedings, and went on to hold that, despite the fact that it appeared that the AEC employed all the procedures required by the Administrative Procedure Act (APA) in 5 U.S.C. § 553 (1976 ed.) and more,

Page 435 U. S. 520

the rulemaking proceedings were inadequate, and overturned the rule, and, accordingly, the AEC's determination with respect to the license was also remanded for further proceedings. In No. 76-528, after examination of a report of the Advisory Committee on Reactor Safeguards (ACRS) and extensive hearings, and over respondent intervenors' objections, the AEC granted petitioner Consumers Power Co. a permit to construct two nuclear reactors, and this ruling was affirmed by the Appeal Board. At about this time, the Council on Environmental Quality revised its regulations governing the preparation of environmental impact statements so as to mention for the first time the necessity for considering energy conservation as one of the alternatives to a proposed project. In view of this development and a subsequent AEC ruling indicating that all evidence of energy conservation should not necessarily be barred at the threshold of AEC proceedings, one of the intervenors moved to reopen the permit proceedings so that energy conservation could be considered, but the AEC declined to reopen the proceedings. Respondents appealed from the granting of the construction permit. The Court of Appeals held that the environmental impact statement for the construction of the reactors was fatally defective for failure to examine energy conservation as an alternative to plants of this size, and that the ACRS report was inadequate, and should have been returned to the ACRS for further elucidation, understandable to a layman, and remanded the case for appropriate consideration of waste disposal and other unaddressed issues.


1. Generally speaking, 5 U.S.C. § 553 (1976 ed.) establishes the maximum procedural requirements that Congress was willing to have the courts impose upon federal agencies in conducting rulemaking proceedings, and while agencies are free to grant additional procedural rights in the exercise of their discretion, reviewing courts are generally not free to impose them if the agencies have not chosen to grant them. And, even apart from the APA, the formulation of procedures should basically be left within the discretion of the agencies to which Congress has confided the responsibility for substantive judgments. Pp. 435 U. S. 523-525.

2. The Court of Appeals in these cases has seriously misread or misapplied such statutory and decisional law cautioning reviewing courts against engrafting their own notions of proper procedures upon agencies entrusted with substantive functions by Congress, and moreover, as to the Court of Appeals' decision with respect to agency action taken after full adjudicatory hearings, it improperly intruded into the agency's decisionmaking process. Pp. 435 U. S. 535-558.

(a) In No. 76-419, the AEC acted well within its statutory authority

Page 435 U. S. 521

when it considered the environmental impact of the fuel processes when licensing nuclear reactors. Pp. 435 U. S. 538-539.

(b) Nothing in the APA, the National Environmental Policy Act of 1969 (NEPA), the circumstances of the case in No. 76-419, the nature of the issues being considered, past agency practice, or the statutory mandate under which the AEC operates permitted the Court of Appeals to review and overturn the rulemaking proceeding on the basis of the procedural devices employed (or not employed) by the AEC, so long as the AEC used at least the statutory minima, a matter about which there is no doubt. Pp. 435 U. S. 539-548.

(c) As to whether the challenged rule in No. 76-419 finds sufficient justification in the administrative proceedings that it should be upheld by the reviewing court, the case is remanded so that the Court of Appeals may review the rule as the APA provides. The court should engage in this kind of review, and not stray beyond the judicial province to explore the procedural format or to impose upon the agency its own notion of which procedures are "best" or most likely to further some vague, undefined public good. P. 435 U. S. 549.

(d) In No. 76-528, the Court of Appeals was wrong in holding that rejection of energy conservation on the basis of the "threshold test" was capricious and arbitrary as being inconsistent with the NEPA's basic mandate to the AEC, since the court's rationale basically misconceives not only the scope of the agency's Statutory responsibility, but also the nature of the administrative process, the thrust of the agency's decision, and the type of issues the intervenors were trying to raise. The court seriously mischaracterized the AEC's "threshold test" as placing "heavy substantive burdens on intervenors." On the contrary, the AEC's stated procedure as requiring a showing sufficient to require reasonable minds to inquire further is a procedure well within the agency's discretion. Pp. 435 U. S. 549-555.

(e) The Court of Appeals' holding in No. 76-528 that the Licensing Board should have returned the ACRS report to the ACRS for further elaboration is erroneous as being an unjustifiable intrusion into the administrative process, and there is nothing in the relevant statutes to justify what the court did. Pp. 435 U. S. 556-558.

No. 76-19, 178 U.S.App.D.C. 336, 547 F.2d 633, and No. 76-528, 178 U.S.App.D.C. 325, 547 F.2d 622, reversed and remanded.

REHNQUIST, J., delivered the opinion of the Court, in which all other Members joined except BLACKMUN and POWELL, JJ., who took no part in the consideration or decision of the cases.

Page 435 U. S. 523

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