Conservation v. Johnson

783 F.2d 858
CourtCourt of Appeals for the Ninth Circuit
DecidedFebruary 24, 1986
DocketNo. 81-7809
StatusPublished
Cited by1 cases

This text of 783 F.2d 858 (Conservation v. Johnson) is published on Counsel Stack Legal Research, covering Court of Appeals for the Ninth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Conservation v. Johnson, 783 F.2d 858 (9th Cir. 1986).

Opinion

FARRIS, Circuit Judge:

Respondent Bonneville Power Administration is a self-financing power marketing agency within the United States Department of Energy. Since the enactment of the Bonneville Project Act of 1937, 16 U.S.C. §§ 832-832/, it has marketed the inexpensive hydroelectric power generated by facilities along the Columbia River. BPA sells electric power to numerous utilities, both publicly owned and private-investor owned, as well as to direct service industrial and government customers, primarily in the Pacific Northwest.

In 1980, Congress adopted the Pacific Northwest Electric Power Planning and Conservation Act, 16 U.S.C. §§ 839-839h, to avert protracted and unproductive litigation over the finite supply of inexpensive federal hydroelectric power. See Aluminum Company of America v. Central Lincoln Peoples’ Utility District, 467 U.S. 380, 104 S.Ct. 2472, 2478, 81 L.Ed.2d 301 (1984). This “Regional Act” required that within 9 months of the effective date of the act BPA “commence necessary negotiations for, and offer, initial long-term contracts” with its various classes of customers. 16 U.S.C. § 839c(g). BPA completed negotiations and offered these contracts on August 28, 1981.

Under the Regional Act, the contracts, once offered, were reviewable upon petition filed within 90 days. 16 U.S.C. § 839f(e)(5). The contracts generated considerable litigation. See, e.g., Aluminum Company, 467 U.S. 380, 104 S.Ct. 2472, 81 L.Ed.2d 301; Forelaws on Board v. Johnson, 743 F.2d 677 (9th Cir.1984);1 Public Power Council v. Johnson, 674 F.2d 791 (9th Cir.1982). This is the last of the Regional Act contract challenges to be submitted for decision.

While the contracts offered BPA’s various customers differ in particulars, they share standard “general contract provisions” challenged en masse in this action. Thus, petitioner CEC contends (1) that section 4 of the standard residential exchange [860]*860contract violates sections 6(b)(1) and 6(b)(3) of the Regional Act, 16 U.S.C. §§ 839d(b)(l) and (3), “by committing BPA to acquire noneconomical resources;” (2) that power sales contract general provision 8(h) violates section 7(i) of the Regional Act, 16 U.S.C. § 839e(i), by establishing a rate without conforming to the prescribed rate-making procedures; (3) that power sales contract general provision 8(f) violates section 7(i) by establishing a method of cost allocation without conforming to the prescribed procedures; and (4) that power sales contract general provision 42(c) is void and unenforceable as it binds BPA to ignore future congressional modification of federal law governing priorities in access to BPA power.

Section 9(e)(5) of the Regional Act provides that “[s]uits to challenge ... final actions ... taken pursuant to [the Act] ... shall be filed in the United States court of appeals for the region.” 16 U.S.C. § 839f(e)(5). The contract offers challenged here constitute “final actions” within the meaning of section 9(e)(5). Central Lincoln Peoples’ Utility District v. Johnson, 686 F.2d 708, 710 (9th Cir.1982), rev’d on other grounds, sub nom. Aluminum Company of America v. Central Lincoln People’s Utility District, 467 U.S. 380, 104 S.Ct. 2472, 81 L.Ed.2d 301 (1984).

BPA’s interpretation of the Regional Act “is to be given great weight.” Aluminum Company, 104 S.Ct. at 2479-80. The regulated subject is technical and complex. BPA has longstanding expertise in the area and participated in drafting the Regional Act. See Zuber v. Allen, 396 U.S. 168, 192, 90 S.Ct. 314, 327, 24 L.Ed.2d 345 (1969). The BPA construction of the Regional Act thus constitutes “a contemporaneous construction of a statute by the men charged with the responsibility of setting its machinery in motion, of making the parts work efficiently and smoothly while they are untried and new.” Udall v. Tailman, 380 U.S. 1, 16, 85 S.Ct. 792, 801, 13 L.Ed.2d 616 (1965).

To uphold the challenged contract provisions, we need not find that BPA’s construction of the relevant provisions of the Regional Act is the only reasonable construction of said provisions or even that said construction is the one we would have adopted had construction been committed to the judiciary in the first instance. Aluminum Company, 104 S.Ct. at 2480; American Paper Institute, Inc. v. American Electric Power Corp., 461 U.S. 402, 422-23, 103 S.Ct. 1921, 1933, 76 L.Ed.2d 22 (1983). We need only conclude that BPA’s interpretation of the Regional Act, as reflected in the challenged contract provisions, is reasonable. Aluminum Company, 104 S.Ct. at 2480. “Only if BPA’s interpretation is unreasonable [should the court] conclude that BPA’s contract offers violate the [Regional] Act.” Central Lincoln, 686 F.2d at 711.

On the limited record before us, we cannot conclude that section 4 of the standard residential exchange contract reflects an unreasonable interpretation of the pertinent provisions of the Regional Act.2 The remaining contentions raised by petitioner are not ripe for judicial review. Accordingly, we dismiss the petition without reaching the merits insofar as petitioner challenges general contract provisions 8(h), 8(f), and 42(c).

RESIDENTIAL EXCHANGE CONTRACT SECTION 4

Section 5(c) of the Regional Act, 16 U.S.C. § 839c(c), establishes a “residential exchange” program designed to temper the inequity of the preference system mandated by the Bonneville Project Act of 1937,16 U.S.C. §§ 832-832Z. See Aluminum Company, 104 S.Ct. at 2484. The allocation of cheap federal power under the preference [861]*861system heavily favored public utilities (preference customers) over private, investor-owned utilities (nonpreference customers).

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Bluebook (online)
783 F.2d 858, Counsel Stack Legal Research, https://law.counselstack.com/opinion/conservation-v-johnson-ca9-1986.