South Carolina ex rel. Campbell v. O'Leary

Reversed and vacated by published opinion. Judge NIEMEYER wrote the majority opinion, in which Judge HALL concurred. Judge DONALD RUSSELL wrote a separate dissenting opinion. OPINION NIEMEYER, Circuit Judge: On January 27, 1995, the district court in South Carolina enjoined the United States from honoring its commitment, made in furtherance of its nuclear nonproliferation policy, to receive into this country and store 409 spent nuclear fuel rods from European research reactors. The United States Department of Energy planned to store the rods in existing and available storage spaces located at its Savannah River Site near Aiken, South Carolina. The district court held that even though the Department of Energy had conducted an Environmental Assessment of its action, in which it found that the action would cause no significant environmental impact, the agency still was required to prepare a full Environmental Impact Statement. The Department of Energy appealed, arguing that its Environmental Assessment was adequate and that if the district court’s injunction were not vacated on an expedited basis, the United States’ nonproliferation policy would be at risk. Because the admission of these 409 spent fuel rods has become a matter of urgency for United States foreign policy, we stayed the district court’s injunction pending the issuance of this opinion. After reviewing the Department of Energy’s Environmental Assessment in light of applicable law, we now conclude that the agency fulfilled its responsibilities under the National Environmental Policy Act (“NEPA”), 42 U.S.C. § 4321 et seq., and related statutes. Accordingly, we reverse the district court’s judgment and vacate the injunction. I As an important aspect of the United States’ longstanding policy for the nonproliferation of nuclear weapons, the United States has sought to convert foreign nuclear reactors from using highly-enriched uranium, which may readily be employed in the construction of nuclear weapons, to low-enriched uranium, which cannot be so employed. Adopting a formal program to encourage that conversion, known as the Reduced En — 895 — richment for Research and Test Reactors program (the “Reduced Enrichment program”), the United States has committed to accept highly-enriched spent nuclear fuel rods from European research reactors for storage in facilities in the United States. Since the 1950s, the United States has supplied nuclear fuel to these foreign research reactors, and until 1992, it agreed to “reprocess” the spent fuel rods. The reprocessing involved a procedure by which the highly-enriched uranium was chemically separated from the spent nuclear fuel and was recycled back into research reactors as fresh fuel or, alternatively, into the United States’ nuclear weapons program. With the end of the Cold War, however, the United States stopped reprocessing spent fuel rods. It also modified the policy of its Reduced Enrichment program, committing to do nothing more than permanently store spent fuel rods in domestic facilities. Because recently enacted statutes and regulations require that the modified Reduced Enrichment program receive environmental review before the Department of Energy can officially implement the policy, foreign nuclear reactors have been forced to retain spent fuel rods at their sites. Over time, storage space for spent fuel rods at foreign reactor sites began to run out, creating the risk that that the foreign reactors would transfer their spent fuel rods to other countries for reprocessing, thus perpetuating the use of highly-enriched uranium in nuclear fuel in contravention of the United States’ nonproliferation policy. A market in highly-enriched uranium would promote the fabrication of nuclear weapons. In July 1993, Hazel O’Leary, the Secretary of Energy, announced a three-tiered proposal to establish a policy for dealing with the problem created by the Department of Energy’s cessation of the receipt of foreign reactor spent fuel. Under the proposal, the Department of Energy recommended: (1) the preparation of an Environmental Impact Statement in connection with a long term plan of selecting a site and constructing a facility to receive 24,000 spent fuel rods from European research reactors; (2) the preparation of an Environmental Assessment in connection with the immediate receipt of a few hundred spent fuel rods in urgent need of shipment for storage at the Department of Energy’s existing storage facility at the Savannah River Site; and (3) the declaration of an emergency situation, pursuant to 40 C.F.R. § 1506.11, for reactor facilities whose situation was so urgent that they could not await completion of an Environmental Assessment. The United States does not have the capacity to receive and store 24,000 spent nuclear fuel rods. If it were to adhere to its policy to receive this large number of rods, a site would have to be selected and a facility constructed following the preparation of a full Environmental Impact Statement. The Department of Energy’s Savannah River Site, which is the only site currently available for storing spent nuclear fuel rods, had approximately 1,400 storage spaces remaining when the Department of Energy announced its plan. Accordingly, the site could be used only for the few hundred rods in urgent need of shipment. In connection with the proposal to receive immediately those spent fuel rods in urgent need of shipment, representatives of the Department of Energy and the State Department conducted an inspection tour of European reactors. Following their tour and the preparation of a draft Environmental Assessment, the Department of Energy released a final Environmental Assessment in April 1994, determining that 409 spent fuel rods were in urgent need of shipment and that there would be no significant environmental impact if these rods were shipped to the Savannah River Site. The Department thus committed to receiving 409 spent fuel rods from eight research reactors located in Austria, Denmark, the Netherlands, Sweden, Germany, Switzerland, and Greece. In the fall of 1994, pursuant to that Environmental Assessment, the Department of Energy received the first shipment of 153 of the 409 spent fuel rods and stored them at the Savannah River Site. Because 99 rods originally scheduled for delivery as part of the 409 were later found not to meet the requirements for urgency set out in the Environmental Assessment, only 157 of the 409 — 896 — spent fuel rods in need of urgent shipment remain to be delivered. Approximately 1,150 spaces remain open at the Savannah River Site. In September 1994, South Carolina filed this action, seeking an injunction to prohibit receipt of the 409 fuel rods. It contended that the Environmental Assessment prepared by the Department of Energy was inadequate and that a full Environmental Impact Statement was required. The district court granted a preliminary injunction barring entry into the United States of the first shipment of 153 spent fuel rods. At the time the injunction was entered, these rods were already on board vessels in the Atlantic Ocean en route to the United States. On September 23, 1994, this court stayed the injunction, holding that South Carolina had failed to show harm sufficient to outweigh the United States’ foreign policy interest in receiving the 153 spent rods. Those rods are now in storage at the Savannah River Site. On January 27, 1995, the district court issued findings of fact and conclusions of law and entered a permanent injunction prohibiting the Department of Energy from “allowing further shipments of spent nuclear fuel to enter this country until an Environmental Impact Statement has been prepared for those shipments.” The district court concluded that the United States’ commitment to receive, on an urgent basis, 409 spent fuel rods had been improperly segmented from the larger shipment of 24,000 rods for which the Department of Energy recognized the need to prepare an Environmental Impact Statement. The court concluded that, when viewed together with the larger proposed shipment of 24,000, the urgent relief shipments of 409 rods constituted “connected actions,” “cumulative actions,” and “similar actions” under 40 C.F.R. § 1508.25(a), thus requiring the Department of Energy to consider the urgent relief shipments as part of the larger shipment for which an Environment Impact Statement is required. Additionally, the district court read the “Spence Amendment” to the National Defense Authorization Act for Fiscal Year 1994 to prohibit the urgent relief shipments unless the Department of Energy either declared an emergency for the urgent relief shipments or prepared an Environmental Impact Statement. The court therefore concluded that there was “no legal provision” for approving the 409-rod shipments with only an Environmental Assessment. Finally, the district court found that, in any event, the Environmental Assessment conducted by the Department of Energy was inadequate because it failed to discuss adequately the alternatives to storing the 409 rods at the Savannah River Site. This appeal followed. II The National Environmental Protection Act (NEPA) requires that each federal agency prepare an Environment Impact Statement on “every recommendation or report on proposals for ... major Federal actions significantly affecting the quality of the human environment....” 42 U.S.C. § 4332(2)(C); Kleppe v. Sierra Club, 427 U.S. 390, 394, 96 S.Ct. 2718, 2723, 49 L.Ed.2d 576 (1976). And the Council on Environmental Quality regulations implementing NEPA, see 40 C.F.R. §§ 1500-1508, require each federal agency to prepare an Environmental Assessment, ie. a document containing sufficient evidence and analysis to “determin[e] whether to prepare an Environmental Impact Statement or a finding of no significant impact.” 40 C.F.R. § 1508.9(a). Thus, if the Environmental Assessment results in a finding of no significant impact, the agency is not required to prepare an Environmental Impact Statement. An agency’s decision to rely on an Environmental Assessment instead of preparing an Environmental Impact Statement is entitled to deference from the courts. See Providence Road Community Ass’n v. EPA 683 F.2d 80, 82 (4th Cir.1982). In connection with the Department of Energy’s proposed receipt and storage of 409 spent nuclear fuel rods at the existing facilities at the Savannah River Site, the agency prepared an Environmental Assessment. Following the issuance of two drafts of the Environmental Assessment and the analysis of public comments, the Department of Energy issued a final Environmental Assessment on April 22, 1994. The Assessment concluded that 409 spent fuel rods qualified for — 897 — urgent relief shipment from reactors in Austria, Denmark, the Netherlands, Sweden, Germany, Switzerland and Greece. The Assessment also specified that the shipments would enter the United States through the military port of Sunny Point, North Carolina, and travel from there to the Savannah River Site by both truck and rail. Following an extensive analysis of the evidence, the Environmental Assessment concluded that the receipt of 409 rods for storage at the Savannah River Site would not significantly impact the environment. Accordingly, it was determined that no Environmental Impact Statement was necessary for the shipment and storage of the 409 rods. The district court concluded that the Environmental Assessment was inadequate in three respects. First, it held that the Spence Amendment, enacted in 1993, eliminated the option of preparing an Environmental Assessment for rods shipped for storage at the Savannah River Site. Second, it held that the Environmental Assessment improperly segmented the 409 spent fuel rods from the larger proposed shipment of 24,000 spent fuel rods, for which an Environmental Impact Statement is required. Finally, it concluded that the Department of Energy’s Environmental Assessment was inadequate on its face because “at least two alternatives were either ignored completely or insufficiently discussed.” We address these points in order. A In the fall of 1993, Congress passed the “Spence Amendment,” named after its sponsor, Congressman Floyd D. Spence of South Carolina, which is encompassed in § 3151 of the National Defense Authorization Act for Fiscal Year 1994.1 The Spence Amendment regulates the “receipt and storage of spent nuclear fuel ... at the Savannah River Site.” Pub.L. No. 103-160, § 3151, 107 Stat. at 1949. The district court interpreted that statute to require the Department of Energy to prepare an Environmental Impact Statement for the receipt and storage of any spent nuclear fuel at the Savannah River Site in the absence of a formal declaration of emergency. Thus, if the district court’s reading were correct, the Department of Energy would not be entitled to rely on an Environmental Assessment to ship spent nuclear fuel rods to the Savannah River Site. However, for the reasons we discuss, we conclude that the district court’s interpretation of the statute is incorrect. On its face, the Spence Amendment requires the completion of an Environmental Impact Statement only if the Secretary of Energy intends to “receive and store at the Savannah River Site any spent nuclear fuel in excess of the amount that (as of the date of the enactment of this Act) the Savannah River Site is capable of receiving and storing.” Id. (emphasis added). The statute clearly permits the Secretary of Energy to accept and store spent nuclear fuel at the Savannah River Site in the absence of an emergency and without preparing an Environmental Impact Statement, as long as the — 898 — number of fuel rods does not exceed the number of available storage spaces at the site. When the Department of Energy decided to accept 409 spent fuel rods for storage at the Savannah River Site, the site contained approximately 1,400 available storage spaces. Currently, approximately 1,150 storage spaces remain available, taking into account the 153 rods already shipped and stored there. Since only 157 of the 409 spent fuel rods covered by the Environment Assessment remain to be delivered, the 1,150 available storage spaces at the Savannah River Site are more than adequate to accommodate these remaining rods. While the Spence Amendment clearly implicates the Department of Energy’s plans to receive 24,000 spent nuclear rods, since that number far exceeds the capacity at the Savannah River Site, the Amendment does not apply to the Department of Energy’s decision to import the 409 rods in urgent need of shipment, including the 157 rods which remain to be shipped. B In justifying its injunction against the United States, the district court also ruled that the shipment of 409 spent rods would constitute an improper segmentation from the Department of Energy’s larger plan to import 24,000 spent fuel rods. It concluded that since an Environmental Impact Statement is required for the 24,000 rods, it was an improper circumvention of that requirement to import the 409 rods with only an Environmental Assessment. The NEPA regulations prohibit an agency from avoiding the requirement of preparing an Environmental Impact Statement by “breaking [its proposed action] down into small component parts” in order to enable it to make a finding of no significant impact on each component. 40 C.F.R. § 1508.27(b)(7). See also Kleppe, 427 U.S. at 409-10, 96 S.Ct. at 2730 (when an agency addresses several proposals related to actions that will have a “cumulative or synergistic environmental impact upon a region ..., their environmental consequences must be considered together”). South Carolina does not argue, nor can it, that the Department of Energy is dividing the importation of European spent fuel rods into several minor shipments in order to avoid the preparation of any Environmental Impact Statement, for the Department of Energy is already conducting an Environmental Impact Statement for the importation of the 24,000 spent fuel rods. Instead, South Carolina argues that there is no meaningful distinction between the urgent relief shipments of 409 rods and the total proposed shipment of 24,000 rods and that if an Environmental Impact Statement is required for the total shipment, the Department of Energy should likewise be required to prepare an Environmental Impact Statement for the “segmented” urgent relief shipments. However, South Carolina apparently fails to appreciate the significance of the fact that there is no site or facility in the United States to receive the 24,000 rods and that an Environmental Impact Statement must be prepared for such a major endeavor. With respect to the 409 rods in need of urgent relief, however, the plan is to store them at existing and approved facilities at the Department of Energy’s Savannah River Site. That site is currently being used on a continuing basis to receive spent nuclear fuel rods from U.S. research reactors, and no Environmental Assessment or Environmental Impact Statement is demanded for each domestic shipment of those rods to the Savannah River Site. The fact that the 409 rods under consideration originate in Europe, instead of the United States, has not been shown to impose a meaningfully different environmental impact. Indeed, the Environmental Assessment conducted by the Department of Energy found that the shipment and storage of these 409 rods would result in no significant impact. Furthermore, as we held in State of North Carolina v. City of Virginia Beach, 951 F.2d 596 (4th Cir.1991), the segmentation of one phase of a larger project prior to the completion of the environmental review of the entire project constitutes impermissible segmentation only if the component action has a “direct and substantial probability of influencing [the agency’s] decision” on the — 899 — larger project. Id. at 603. These urgent relief shipments fail to pose such an influence; they do not in any way commit the government to accepting the larger shipment of 24,000 rods nor do they determine the outcome of the Environmental Impact Statement that is currently being prepared for the larger shipment. Finally, the district court held that the urgent relief shipments of 409 rods and the larger, proposed 24,000-rod shipments qualify as “connected actions,” “cumulative actions,” and “similar actions” within the meaning of 40 C.F.R. § 1508.25(a). If the district court were correct, then the applicable NEPA regulations would require that such related actions be considered in the same Environmental Impact Statement. However, a careful reading of the regulations fails to support the district court’s conclusion. Separate actions are considered “connected” if they (1) “[ajutomatieally trigger other actions which may require Environmental Impact Statements”; (2) “[cjannot or will not proceed unless other actions are taken previously or simultaneously”; or (3) “[ajre interdependent parts of a larger action and depend on the larger action for their justification.” See 40 C.F.R. § 1508.25(a)(1). The urgent relief shipments of 409 rods do not qualify as “connected actions” under any of these three definitions. The shipments involving 409 rods do not “automatically trigger” the acceptance of the larger 24,000-rod shipments, nor does their utility depend upon the viability of the larger shipment. The urgent relief shipments are independent and separable, and merely preserve the Department of Energy’s option to accept the larger shipments. The urgent relief shipments of 409 rods and the larger proposed shipments of 24,000 rods also do not qualify as “cumulative actions,” which are defined as actions “which when viewed with other proposed actions have cumulatively significant impacts.” 40 C.F.R. § 1508.25(a)(2). By itself, the proposed shipment of 24,000 spent fuel rods has a significant impact requiring an Environmental Impact Statement. Such a shipment will necessitate the construction of a new domestic storage facility regardless of whether the Department of Energy is permitted to accept the urgent relief shipments. Furthermore, the cumulative impact of accepting the urgent relief shipments is not “significant,” in that it does not require the construction of a new facility or even materially deprive the United States of existing storage facilities. The Department of Energy has projected that it will run out of storage spaces at the Savannah River Site in May 1999 if it does not receive the urgent relief shipments, and in January 1999 if it does receive them. We also disagree with the district court’s characterization of the two separate projects as “similar actions.” Similar actions are defined as having “similarities that provide a basis for evaluating their environmental consequences together, such as common timing or geography.” 40 C.F.R. § 1508.25(a)(3). Other than the fact that both the urgent relief shipments and the larger 24,000-rod shipments involve spent nuclear fuel, the two shipments are dissimilar. The timing of the shipments is different, since the urgent relief shipments are scheduled to conclude within the next few months and the larger shipments will not begin for several years, if ever. Moreover, since a site for the larger facility has not been selected, it may be constructed at an entirely different area of the country with no geographic similarity to the Savannah River Site. Accordingly, we conclude that the district court’s segmentation argument is not supported in fact or by law. C As its final reason for entering the injunction and rejecting the Environmental Assessment prepared by the Department of Energy, the district court concluded that the Department of Energy failed to consider alternatives to the Savannah River Site for storage of the urgent relief shipments. Under NEPA and corresponding regulations, an Environmental Assessment, must include “brief discussions” of alternatives to the proposed agency action. See 40 C.F.R. § 1508.9. — 900 — The district court found specifically in this case that the Department of Energy “ignored completely or insufficiently discussed” both (1) reprocessing the spent fuel in the United States, and (2) reprocessing it, storing it, or “blending it down” at Britain’s Atomic Energy Agency facility in Dounreay, Scotland. Both alternatives, however, involve the reprocessing of highly-enriched uranium, which is inconsistent with the current United States policy. The reprocessing of spent highly-enriched nuclear fuel rods produces materials that may be used for fabricating nuclear weapons. Yet current national policy specifically seeks to avoid this possibility. As the Environmental Assessment prepared by the Department of Energy noted, “Reprocessing increases the threat of nuclear proliferation because it encourages the continued use of highly-enriched uranium.” Thus, the Department of Energy did effectively consider the reprocessing alternatives identified by the district court and rejected them as contrary to national policy. And the courts are not free to reject an Environmental Assessment because an agency refuses to change its policy. See Coalition For Responsible Regional Development v. Coleman, 555 F.2d 398, 401-02 (4th Cir.1977) (alternative properly rejected because it would “not accomplish the objectives of the (proposed) project”); Headwaters, Inc. v. Bureau of Land Management, 914 F.2d 1174, 1180 (9th Cir.1990) (an agency is not required to consider alternatives which are “infeasible, ineffective, or inconsistent with the basic policy objectives” for the action at issue). Ill The governor and attorney general of South Carolina are apparently concerned about the storage in their state of 24,000 spent nuclear fuel rods, and even about the storage of the 409 rods under consideration in this action. They fairly observe that “the environmental consequences of even a single accident [involving spent fuel rods of highly-enriched uranium] could be devastating.” While the record reveals South Carolina’s sincere concern over the storage of spent nuclear fuel in the State, the limited issue before us is the procedural one of whether the Department of Energy properly prepared and relied on its Environmental Assessment with respect to the 409 rods in urgent need of shipment. Granting the proper deference to the federal agency, we affirm the Department of Energy’s procedural actions under NEPA, leaving to Congress and to South Carolina any continuation of the substantive dialogue about the advisability of further storage of nuclear fuel in South Carolina.2 See Vermont Yankee Nuclear Power Corp. v. Natural Resources Defense Council, Inc., 435 U.S. 519, 558, 98 S.Ct. 1197, 1219, 55 L.Ed.2d 460 (1978) (“The fundamental policy questions appropriately resolved in Congress and in the state legislatures are not subject to reexamination in the federal courts under the guise of judicial review of [an agency’s NEPA action]”). Accordingly, the judgment of the district court is reversed and the injunction entered by the district court on January 27, 1995, is vacated. IT IS SO ORDERED. Footnotes [1] The Spence Amendment provides in pertinent part: Sec. 3151. Limitations on the Receipt and Storage of Spent Nuclear Fuel from Foreign Research Reactors. (a) PURPOSE. — It is the purpose of this section to regulate the receipt and storage of spent nuclear fuel at the Department of Energy defense nuclear facility located at the Savannah River Site, South Carolina (in this section referred to as the “Savannah River Site”). (b) RECEIPT IN EMERGENCY CIRCUMSTANCES. — When the Secretary of Energy determines that emergency circumstances make it necessary to receive spent nuclear fuel, the Secretary shall submit a notification of that determination to the Congress. The Secretary may not receive spent nuclear fuel at the Savannah River Site until the expiration of the 30-day period beginning on the date on which the Congress receives the notification. (c)LIMITATION ON STORAGE IN NON-EMERGENCY CIRCUMSTANCES. — The Secretary of Energy may not, under other than emergency circumstances, receive and store at the Savannah River Site any spent nuclear fuel in excess of the amount that (as of the date of the enactment of this Act) the Savannah River Site is capable of receiving and storing, until, with respect to the receipt and storage of any such spent nuclear fuel— (1) the completion of an environmental impact statement under section 102(2)(C) of the National Environmental Policy Act of 1969 (42 U.S.C. 4332(2)(C).... Pub.L. No. 103-160, § 3151, 107 Stat. 1547, 1949 (enacted November 13, 1993). [2] The enactment of the Spence Amendment is a manifestation of this dialogue, reaffirming that Congress is the appropriate forum for airing these substantive policy issues. Moreover, its enactment evidences that South Carolina enjoys sufficient power as a participant in this dialogue to assure that its position is given fair consideration.