Client Alert
The Ninth Circuit Continues to Give Technical Decisions Heightened Deference and Validates Take Permit for Utility Scale Solar Project
May 23, 2017
David Woodsmall & Jill Yung
On May 18, 2017, in Defenders of Wildlife v. Zinke, the U.S. Court of Appeals for the Ninth Circuit unequivocally rejected challenges to a 2013 biological opinion (“BiOp”) authorizing development of a 250 megawatt (“MW”) solar project along the California/Nevada border. The decision is noteworthy as it demonstrates once again that carefully designed and documented solar projects will survive judicial challenges. Moreover, although the decision did not announce revolutionary changes in the law, its multiple holdings significantly affirmed interpretations of the Endangered Species Act (“ESA”)[1] in ways that could meaningfully impact solar projects that require formal consultation with the United States Fish & Wildlife Service (“FWS”).
First, the court continued to adhere to the principle that the ESA empowers the FWS to make decisions, about both the impacts to species and the need for mitigation, in the face of uncertainty.[2] Second, reduced connectivity alone does not trigger an adverse modification designation. Third, FWS’s conclusion that solar projects have minimal edge effects on desert tortoises was not arbitrary and capricious. Fourth, BiOps are not required to address inconsistent agency recommendations unsupported by necessity findings. Fifth, and finally, BiOps need not specify the precise contours of “new information” that will trigger the ESA’s requirement to reinitiate formal consultation; the opinion need only provide clear reinitiation triggers with respect to exceedances of quantitative take.
The court’s effortless dismissal of the plaintiff’s grasping claims should give desert solar developers some encouragement that the many hoops they have jumped through to satisfy the ESA’s requirements in the past have been sufficient. Indeed, as recognized by the court, developers have in fact exceeded their obligations under the ESA.
Background
In 2008, NextLight Renewable Power, LLC applied to the Bureau of Land Management (“BLM”) for a right-of-way to build the 400MW Silver State Solar Project in Clark County, Nevada. The Final Environmental Impact Statement (“EIS”) for the project supported the adoption of the project, however portions of it were located in desert washes and other desert tortoise habitat that environmentalists insisted should be protected. In particular, project opponents maintained that the proposed development would significantly impair a movement corridor connecting discrete desert tortoise subpopulations and areas of the tortoises’ critical habitat. To allow for more careful consideration of the impact of development in this area, a subsequent owner, First Solar, Inc., agreed to postpone development of Phases II and III (350MW on 2,515 acres) and requested that BLM approve only the development of Phase I (50MW/451 acres) in its Record of Decision (“ROD”).
In September, 2011, BLM published a notice of intent to prepare a Supplemental EIS (“SEIS”) for Silver State Phases II and III (renamed the Silver State Solar South Project [“SSS”]). As initially proposed and reviewed in the SEIS, SSS was not significantly different from the portions of the Silver State Solar Project that BLM dropped from its first ROD. Yet notwithstanding its prior approval of the full 400MW project in a 2010 BiOp, FWS’s comments on the draft SEIS contended that the project should be, among other things, scaled back to preserve a movement corridor “spanning up to several times the desert tortoise lifetime utilization area”[3] (i.e., at least 2.8 miles). In response to these and other concerns raised in public comments, First Solar withdrew 100MW (Phase III) from the proposed development and moved Phase II to the west (thereby significantly increasing the corridor width compared to the previously approved 400 MW project and resulting in a corridor that ranged from 1.39 to 2 miles wide, and was an average of 1.5 miles wide).[4] First Solar also agreed to incorporate a monitoring program to track SSS’s impact on desert tortoise connectivity that further required BLM to re-initiate formal consultation under the ESA if the project’s impact on the tortoise’s demographic and genetic stability rose above the monitoring program’s threshold level of significance.
Taking these changes into account, the BiOp reissued by FWS for SSS in late-2013 concluded that it was uncertain whether the reduced width of the corridor between SSS and the Lucy Gray Mountains “would cause demographic or genetic instability.”[5] But if such instability did occur, the project’s monitoring program would permit BLM to detect the issue and undertake corrective action by re-initiating formal consultation under the ESA. The BiOp further concluded that the project was not likely to adversely affect the desert tortoise’s critical habitat because the project would not occur within or impact critical habitat.
Legal Battle—the Opinion of the Ninth Circuit
In 2014, Defenders of Wildlife (“DOW”) sought to have FWS’s BiOp vacated on grounds that it was arbitrary and capricious. DOW quickly lost its motion for a preliminary injunction in a well-reasoned decision that hinged on DOW’s failure to demonstrate a likelihood of success on the merits.[6] A year later, the District Court issued a summary judgment in favor of FWS, concluding that, notwithstanding plaintiff’s “sophisticated argument based on critical habitat”, FWS’s “administrative conclusions deserve deference.”[7] The Ninth Circuit unanimously affirmed that decision, maintaining the untarnished record of solar power projects in federal court cases challenging their approval. The decision further upheld several practices that should, if FWS continues to follow them, facilitate future solar project construction efforts, even in areas where endangered and threatened species may be impacted.
No Jeopardy Decisions May Be Made in the Face of Uncertainty
Pursuant to section 7 of the ESA, Federal agencies must “insure that any action authorized, funded, or carried out by such agency . . . is not likely to jeopardize the continued existence of any endangered species or threatened species or result in the destruction or adverse modification of [designated critical] habitat . . . .”[8] To assist Federal agencies in complying with this obligation, the ESA further requires that agencies consult with either the FWS or the National Marine Fisheries Service (“NMFS”). If the consulting agency (FWS or NMFS) concludes that the proposed activity is likely to adversely affect an ESA-listed species, it will further consider whether, taking into account reasonable and prudent measures, other terms and conditions, conservation recommendations, and consultation re-initiation requirements, it may conclude either that jeopardy is not likely and that there will not be adverse modification of critical habitat, or that there is a “reasonable and prudent alternative” to the agency action that avoids jeopardy and adverse modification, and that the incidental taking of endangered or threatened species will not violate section 7(a)(2) of the ESA. A BiOp documents the consulting agency’s jeopardy determination and additionally includes “an ‘Incidental Take Statement’ [(‘ITS’)] which, if followed, exempts the action agency from the prohibition on takings found in Section 9 of the ESA.”[9]
In the case of SSS, the FWS concluded that the project was not likely to jeopardize the continued existence of the desert tortoise because, among other things, “the reduction in the width of habitat east of the Silver State South Project is either unlikely to degrade demographic or genetic stability in Ivanpah Valley or [FWS] will be able to detect degradation of those values and implement remedial actions, if necessary.”[10] DOW complained that this portion of the opinion improperly relied on unspecified remedial measures. However, this argument overlooked the fact that although the mitigation measures were somewhat uncertain, so were the impacts, due to a “lack of a scientific consensus regarding the requisite corridor width necessary to support connectivity for the desert tortoise.”[11] Guaranteed mitigation measures—those involving specific and binding plans and a clear and definite commitment of resources—are required only where immediate negative effects are certain.[12]
Reduced Connectivity Alone Is Not an “Adverse Modification” of Critical Habitat
As noted above, the ESA requires Federal agencies to insure that Federal actions will not “result in the destruction or adverse modification” of species’ critical habitat.[13] From 1986 to 2016, the ESA’s implementing regulations defined “destruction or adverse modification of critical habitat” as “a direct or indirect alteration that appreciably diminishes the value of critical habitat for both the survival and recovery of a listed species.”[14] This definition, however, was called into doubt by the Ninth Circuit’s 2004 decision in Gifford Pinchot Task Force v. U.S. Fish & Wildlife Service.[15] There, the court determined that the definition failed to advance the ESA’s aim to promote not only species survival, but also species recovery.[16] Because “it is logical and inevitable that a species requires more critical habitat for recovery than is necessary for the species survival,” defining adverse modification as actions that adversely affect critical habitat for the “survival and recovery of a listed species” led adverse modification inquiries to focus solely on the amount of habitat required for species survival, improperly reading the recovery goal out of the statute.[17]
Modified in early-2016 in response to Gifford, the regulation now defines “destruction or adverse modification of critical habitat” as “a direct or indirect alteration that appreciably diminishes the value of critical habitat for the conservation of a listed species.”[18] This expanded definition—which includes lands required for survival and recovery of a listed species—appeared at the time of its adoption to have the potential to significantly constrain development that previously would have been outside the reach of the ESA. The Ninth Circuit’s interpretation, however, clarified that adverse modification still has two requirements: (1) “there must be an alteration to the critical habitat;” and (2) the modification must have adverse effects on the critical habitat.[19] A project only adversely modifies critical habitat if it directly or indirectly alters it. Although reduced connectivity outside of critical habitat can negatively modify an endangered or threated species by leading to a change in its genetic health, this does not equate to, or substitute as, modification of the species’ critical habitat itself required to trigger an adverse modification determination.[20]
Solar Projects Have Minimal Edge Effects
The court provided an additional win for solar developers by upholding FWS’s conclusion that solar projects have minimal edge effects on desert tortoise populations. DOW alleged that the corridor left after construction of SSS would be significantly less than the 1.4 miles stated in the BiOp due to the project’s edge effects—the project’s impact on species and habitat beyond the project’s boundary.[21] Rejecting this claim, the court concluded that evidence in the record corroborated FWS’s conclusion that the project’s impacts would not appreciably extend into adjacent habitat.[22]
Although the studies cited in the record concerned edge effects at solar plants in the Ivanpah Valley, the court’s holding could have implications for projects in other areas because FWS, and the court, did not confine their conclusions to projects in the valley. Indeed, the court determined that the record “corroborates the [BiOp’s] explanation that solar plants result in minimal edge effects.”[23] Although the specific magnitude of a plant’s edge effects is ultimately a site-specific inquiry, the opinion essentially confirms that existing scientific studies support the conclusion that solar plants generally have minimal edge effects.
BiOps Are Not Required to Respond to Agency Recommendations
The court also found that BiOps are not required to respond to agency comments and recommendations that do not rise to the level of mandates. Agencies must provide reasoned explanations for their actions, including authorizing projects under the ESA and supporting conclusions in BiOps.[24] Such explanation should address prior factual findings in directly related matters that conflict with, or otherwise challenge, the agency’s conclusions.[25] However, this duty does not require agencies to respond to inconsistent recommendations alone, absent factual findings.[26]
Although SSS’s BiOp authorized a narrower movement corridor than FWS recommended in its comments on the SEIS, the BiOp was not arbitrary and capricious for two reasons. First, FWS’s recommendation did not contain any scientific or factual findings.[27] Although the agency recommended that the project conserve a movement corridor larger than 1.4 miles, it did not conclude, or provide facts indicating, that a 1.4 mile corridor “would affirmatively result in loss of connectivity, jeopardy, or adverse modification.”[28] The agency’s mere recommendation, absent findings that the recommendations must be followed to avoid a specific outcome, did not constitute divergent findings requiring FWS to justify its subsequent decision to authorize a narrower movement corridor.[29] Second, even if the agency’s recommendation had contained factual findings, the project was so significantly redesigned during formal consultation that the findings would not have been inconsistent because they did not account for the smaller footprint and mitigation measures for the redesigned project.[30]
Agencies Are Not Required to Define New Information that Requires Reinitiating ESA Consultation in BiOps
The court further held that BiOps are not required to explicitly specify the types of “new information” that force an agency to reinitiate formal consultation under the ESA. The ESA mandates that agencies reinitiate formal consultation under limited scenarios. First, an agency must reinitiate consultation—and “revoke[] an action agency’s . . . immunity from penalties under Section 9 of the ESA”[31]—if a project takes or adversely affects a number of animals or area of habitat in excess of the limit defined in its ITS.[32] Ninth Circuit precedent in particular requires incidental take statements to provide “clear standards” for determining when a project exceeds its incidental take limit and triggers the requirement to reinitiate formal consultation.[33]
Second, the ESA requires an agency to reinitiate formal consultation when “new information reveals effects of the action that may affect listed species or critical habitat in a manner or to an extent not previously considered.”[34] Interpreting this provision, the Ninth Circuit held that SSS’s BiOp was not required to clearly define criteria for determining the types of evidence that, if discovered by the project’s monitoring program, would trigger the requirement to reinitiate consultation under the ESA’s new information provision.[35] The court rebuffed DOW’s efforts to persuade it to apply the incidental take trigger’s “clear standards” requirement to the types of new information that require parties to reinitiate formal consultation. Because “[n]either the ESA nor its implementing regulations require the action agency to identify standards for determining whether information is ‘new’ or explaining how ‘new information’ will be evaluated,” SSS’s BiOp exceeded the ESA’s requirements simply by providing any threshold level of change to the tortoise’s demographic and genetic stability that would require FWS to reinitiate consultation.[36] The court commended the BiOp for including this “new information” trigger, but emphasized that it is not required by the ESA. In any event, the court concluded that the new information trigger specified in the BiOp provided a “clear standard” to reinitiate consultation.
Conclusions
Given the trend of Ninth Circuit decisions affording heightened deference to agency actions requiring technical expertise[37] and DOW’s repeated failures to convince the trial court of the merits of its case, the circuit’s decision was not unexpected. Indeed, many of the key holdings were established early on in the case, when Paul Hastings successfully defended the BiOp against a motion for preliminary injunction and the trial court, without reservation, declared that Plaintiff first and foremost failed to show any likelihood of success on the merits. The Ninth Circuit’s precedents easily encompassed or could be extended to cover the actions taken by FWS and to reject the reaching expansions of the law sought by DOW. Furthermore, as observed by the Ninth Circuit, the BiOp went above and beyond the ESA’s requirements, including in other ways that were not relevant to, and thus not discussed in, the court’s decision.
What is perhaps surprising is that despite the government’s success in this case, and almost every other case challenging the permitting of utility-scale solar projects on public lands, both FWS and BLM have become more conservative in their permitting, in particular by adopting programmatic documents, such as the Desert Renewable Energy Conservation Plan, that call for significantly greater scrutiny of project applications and strict limitations on where they can be sited. While some of these changes might be attributable to new information about the impacts of solar projects on the environment, the legal framework being established by the courts gives the agencies more, not less, of a license to approve these projects without imposing exhaustive study requirements.
[1] 16 U.S.C. §§ 1531 et seq.
[2] Ariz. Cattle Growers’ Ass’n v. Salazar, 606 F.3d 1160, 1164 (9th Cir. 2010).
[3] Memorandum from the State Supervisor, Nev. FWS Office to the Renewable Energy Project Manager, BLM Las Vegas Field Office 2 (Nov. 16, 2012).
[4] 76 Fed. Reg. 54,483 (Sept. 1, 2011).
[5] Memorandum from the Acting Field Supervisor, Ventura FWS Office to Field Manager, Needles Field Office, BLM 84-85 (Sept. 30, 2013) (“BiOp”).
[6] Defenders of Wildlife v. Jewell, Case No. CV 14-1656-MWF (RZx), 2014 U.S. Dist. LEXIS 50614 (C.D. Cal. Apr. 2, 2014). In this phase of the litigation, Paul Hastings represented SSS and the Stateline Solar Farm Project, both of which were evaluated in the joint BiOp challenged by DOW. Our involvement ended after First Solar sold SSS to another developer and settled DOW’s lawsuit with respect to the Stateline project.
[7] Defenders of Wildlife v. Jewell, Case No. CV 14-1656-MWF (RZx), slip. op. at 1 (C.D. Cal. Mar. 30, 2015).
[8] Nat'l Wildlife Fed'n v. Nat'l Marine Fisheries Serv., 422 F.3d 782, 790 (9th Cir. 2005) (quoting 16 U.S.C. § 1536(a)(2)).
[9] Id. (citing 16 U.S.C. § 1536(b)(4); Aluminum Co. of Am. v. Administrator, Bonneville Power Admin., 175 F.3d 1156, 1159 (9th Cir. 1999)).
[10] Defenders of Wildlife v. Zinke, No. 15-55806, 2017 WL 2174546, at *6 (9th Cir. May 18, 2017) (“Opinion”) (quoting BiOp at 85).
[11] Id.
[12] Id. at *7.
[13] 16 U.S.C. § 1536(a)(2).
[14] 50 C.F.R. § 402.02 (2014).
[15] 378 F.3d 1059 (9th Cir. 2004).
[16] Id. at 1069.
[17] Id.
[18] 50 C.F.R. § 402.02 (2016) (emphasis added).
[19] Opinion at *9.
[20] Id. at *10.
[21] Id. at *11.
[22] Id. at *12.
[23] Id. at *12.
[24] Id. at *10 (citing Humane Soc’y of U.S. v. Locke, 626 F.3d 1040, 1051 (9th Cir. 2010)).
[25] Id.
[26] Id. at *11.
[27] Id.
[28] Id.
[29] Id.
[30] Id.
[31] Id. at *12, fn. 3.
[32] 50 C.F.R. § 402.16(a).
[33] Ariz. Cattle Growers’ Ass’n v. U.S. Fish & Wildlife Serv., 273 F.3d 1229, 1249-51 (9th Cir. 2001).
[34] 50 C.F.R. § 402.16(b).
[35] Opinion at *12.
[36] Id.
[37] E.g., Cascadia Wildlands v. Thrailkill, 806 F.3d 1234, 1241 (9th Cir. 2015); Ctr. for Biological Diversity v. U.S. Fish & Wildlife Serv., 807 F.3d 1031, 1043 (9th Cir. 2015).