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South Carolina Pub. Serv. Auth. v. Federal Energy Regulatory Comm'n

Citation: 19 ELR 20050
No. No. 87-1146, 850 F.2d 788/(D.C. Cir., 07/05/1988)

The court holds that the Federal Energy Regulatory Commission's (FERC's) licensing authority under the Federal Power Act does not include the power to displace existing state tort law regarding liability for damages caused by FERC licensees. FERC had imposed certain conditions on the continued operation of a state-owned hydroelectric project in South Carolina, including that the state agree to provide compensation for all foreseeable property damage caused by any seismically induced dam failure. The court holds that FERC exceeded its authority when it conditioned the renewal of the project's license upon the state's acceptance of such strict liability. Although § 10 of the Federal Power Act requires FERC to ensure that a project is safe before relicensing, a compensation scheme is more than a simple requirement of safety measures to protect property. The proposed compensation scheme substitutes the Commission's preferred rule for existing state law, and would deprive the state of its traditional authority to determine the rules of tort liability. If the power to specify a federal rule of liability were essential to accomplishing the Act's goals, Congress' silence might still permit FERC to assert a federal rule; however, there is no evidence of such a need here. To the extent that there is any legislative history, it suggests that Congress intended for state law to apply to damage claims against FERC licensees.

Counsel for Petitioner
Carmen D. Legato
Swidler & Berlin
3000 K St. NW, Ste. 300, Washington DC 20007
(202) 944-4300

Counsel for Respondent
Joshua Z. Rokach
Federal Energy Regulatory Commission
825 N. Capital St. NE, Rm. 3000, Washington DC 20426
(202) 357-8191

Before: D. H. GINSBURG and SENTELLE, Circuit Judges, and MARKEY,* Chief Judge, United States Court of Appeals for the Federal Circuit.