## Facts

- Congress added Federal Power Act (FPA) § 216 in the Energy Policy Act of 2005, creating limited “backstop” federal permitting for electric transmission facilities in Department of Energy-designated National Interest Electric Transmission Corridors.
- Section 216 allows FERC to issue a permit in specified circumstances, including when a state commission has “withheld approval for more than 1 year” after an application is filed.
- FERC issued Order No. 689 interpreting “withheld approval” to include both (a) state inaction for more than one year and (b) a state’s denial of an application within the one-year period.
- Environmental groups, state utility commissions, and citizen groups filed petitions for review challenging FERC’s interpretation as exceeding statutory authority and improperly expanding federal preemption over state siting decisions.
- The case reached the Fourth Circuit on consolidated petitions for review of the final rule, not review of any specific transmission permit order.

## Issues

1. Whether “withheld approval for more than 1 year” in FPA § 216(b)(1)(C)(i) includes a state commission’s express denial of a transmission siting application within the one-year period.
2. Whether FERC’s interpretation was entitled to deference under Chevron.

## Decision

- The court granted the petitions in part and vacated the portion of Order No. 689 treating a timely state denial as “withheld approval for more than 1 year.”
- The court held that § 216(b)(1)(C)(i) does not authorize FERC to issue a permit based on a state’s denial issued within one year of filing.
- The court concluded the statutory text unambiguously refers to state delay or inaction exceeding one year, not an affirmative denial.
- Because the statute was unambiguous at Chevron step one, the court declined to defer to FERC’s contrary interpretation.
- The matter was remanded to FERC for further proceedings consistent with the court’s construction of § 216.

## Legal Principles

- When statutory language is clear, an agency cannot expand its jurisdiction through interpretation; courts apply Chevron step one to enforce unambiguous text.
- “Withheld approval for more than 1 year” in FPA § 216(b)(1)(C)(i) means a state’s failure to act for over one year, not a timely denial.
- FPA § 216 preserves a primary state role in transmission siting, with FERC’s permitting authority operating as a limited backstop triggered only under enumerated conditions.

## Conclusion

The Fourth Circuit limited FERC’s backstop siting authority under FPA § 216 by holding that a state commission’s timely denial of a transmission application is not “withheld approval for more than 1 year,” preventing FERC from using § 216(b)(1)(C)(i) to override prompt state rejections.


Piedmont Environmental Council v. FERC, 558 F.3d 304 (4th Cir. 2009)