MEMORANDUM OPINION
ROSEMARY M. COLLYER UNITED STATES DISTRICT JUDGE
The
State of Maryland cherishes the Chesapeake Bay and is
determined to save the Bay by removing pollutants. The
Susquehanna River delivers about 75% of the freshwater in the
Bay; its environmental health is critical. The River is over
400 miles long, originating in New York State, flowing
through the Commonwealth of Pennsylvania, and then, for its
last 15 miles, traversing part of Maryland before emptying
into the Bay at Havre de Grace. This multistate watershed
creates a pollutant problem. The River transports great
amounts of phosphorus and nitrogen-farm
nutrients-turned-pollutants-and other detritus from New York
and Pennsylvania to the Bay.
Exelon
Generation Co., LLC operates the Conowingo Project, a
Maryland dam and hydroelectric power plant that is ten miles
upriver from the Bay. The Conowingo Project has applied to
the Federal Energy Regulatory Commission for a new operating
license. As the cost of such a federal license, Maryland
insists that the Conowingo Project remove the phosphorus and
nitrogen that flow downriver from New York, Pennsylvania, and
Maryland. In lieu of cleaning the Susquehanna, Maryland would
accept $172 million from Exelon each year for the next 50
years.
The
Conowingo Project adds no phosphorus or nitrogen to the
Susquehanna River; it only passes the water along. Exelon
protests that it should not be made to pay up to $7 billion
to clean up pollution sent downriver by others. Exelon has
sued Benjamin H. Grumbles and D. Lee Currey in their official
capacities as Secretary of the Environment and Director,
Water and Sciences Administration of the Maryland Department
of the Environment, respectively.
Right
now, the question is whether Exelon's lawsuit is brought
in the right court. Maryland argues that it belongs in its
State courts. Alternatively, it argues that the case should
be brought in the United States District Court for the
District of Maryland. The issue is fully
briefed[1] and the Court heard oral argument. For the
reasons explained below, this Court disagrees on both points
and concludes that venue lies in D.C. as well as Maryland.
The Court will deny so much of Maryland's motion to
dismiss as is based on improper venue.
I.
FACTS
A.
Background
Exelon
Generation Company, LLC (Exelon), owns and operates the
Conowingo Dam and hydroelectric facility (the Conowingo
Project). Exelon is a Pennsylvania limited liability company
and a fully owned subsidiary of Exelon Corporation, a
Pennsylvania corporation. The Conowingo Project produces
electricity, which it provides directly to the mid-Atlantic
power grid and indirectly to a majority of Maryland homes and
businesses; it generates more renewable electricity than all
other facilities in the State of Maryland combined.
The
Susquehanna River was first dammed at Conowingo ninety-odd
years ago to create a reservoir for Baltimore, Maryland, and
to produce hydroelectric power. The main branch of the
Susquehanna originates in New York State and flows for over
400 miles through New York and Pennsylvania, where it is
joined by a junior east-west branch from across Pennsylvania,
and then into Maryland. See Defs.' Mem at 3.
Only about fifteen miles of the River are in Maryland before
it empties into the Chesapeake Bay. The impoundment created
by the Dam, i.e., the Baltimore reservoir, fully
occupies the first five miles of the Susquehanna in Maryland,
from the Pennsylvania/Maryland border to the Conowingo Dam.
Compl. ¶ 19. The mouth of the Susquehanna is ten miles
downstream from the Conowingo Dam at Havre de Grace. See
id. Over its lifespan, the Dam has trapped and retained
some of the harmful nutrients-turned-pollutants in the runoff
from upstream farms and businesses in New York, Pennsylvania,
and Maryland, preventing such pollutants from reaching the
Bay. Id. ¶¶ 22-23. Now, however, its
trapping capacity is declining, as sediment flowing
downstream has been deposited in the reservoir and reduced
its depth. Id. ¶ 25.
Exelon
has applied to the Federal Energy Regulatory Commission
(FERC) to renew its operating license for the Conowingo
Project for 50 years under the Federal Power Act (FPA), 16
U.S.C. §§ 791a-823g; see also Compl.
¶ 30. Under Section 401 of the Clean Water Act (CWA), 33
U.S.C. § 1341(a)(1), the State of Maryland must certify
that the Conowingo Project is compliant with State
water-quality laws and regulations before FERC can grant the
license. Id. ¶¶ 39-41. Presently, however,
Maryland and all the states in the Chesapeake Bay watershed
are facing the likelihood of increased demands from the
Environmental Protection Agency (EPA) to eliminate more
nitrogen and phosphorous from their waters that enter the
Bay. See id. ¶¶ 117-22. Maryland has
welcomed the opportunity of the FERC re-licensing process to
require that the Conowingo Project remove such pollutants
from the Susquehanna River in the amounts that EPA would
normally apportion among the multiple states around the Bay
or the three states through which the Susquehanna flows.
Id. ¶¶ 110, 119. Alternatively, the
Conowingo Project at the tail end of the River can avoid this
obligation to clean up 400-plus miles of pollutants from
neighboring states by paying Maryland approximately one-half
million dollars ($500, 000) each day over the life of its
next FERC license, or approximately $7 billion in the next 50
years. The Maryland Department of the Environment (MDE) has
submitted its Certification to FERC with such requirements.
Id. ¶ 94. FERC is obligated to include these
terms in a new license for the Conowingo Project, which is
now under consideration.
Exelon
appealed through the state administrative and court processes
and filed suit under federal law here.
B.
The Exelon Application to FERC for a New License
In
anticipation of its renewal application, Exelon developed a
study plan in or about 2009 and performed more than 45
separate studies regarding various environmental issues,
including fish passage, stream flow, the water transport of
sediment, and water temperature. Exelon filed its application
with FERC on August 31, 2012.
In
2015, FERC issued an Environmental Impact Statement (EIS) for
three hydroelectric projects on the lower Susquehanna,
including the Conowingo Project in Maryland. The EIS noted
that the Susquehanna River “is the largest source of
freshwater to the Chesapeake Bay, contributing about 70% of
the total nitrogen and 55% of the total phosphorus, and that
the presence of these pollutants is a watershed-wide
issue.” Compl. ¶ 36. The EIS warned that if the
Conowingo Reservoir could no longer trap sediment and
pollutants, “governmental jurisdictions in the
watershed might need to increase their . . .
nutrient-reduction efforts.” Id.
The EIS
also evaluated whether dredging might be a reasonable way to
increase the trapping capacity of the Conowingo Reservoir to
continue its ability to reduce pollutants in the Bay.
However, citing the Lower Susquehanna River Watershed
Assessment-a joint assessment by the Army Corps of Engineers
and the MDE-the FERC EIS concluded that “operational
changes at Conowingo would not address the sediment transport
issue, and that dredging of Conowingo [Reservoir] would be
cost prohibitive and ineffective.” Id. ¶
37 (internal quotation marks omitted).
Exelon
also engaged in detailed negotiations with the Department of
the Interior (DOI) Fish & Wildlife Service regarding fish
spawning in the Susquehanna River as part of its relicensing
process. Those parties reached a settlement whereby Exelon
committed to enhancing fish passage over the Dam by trapping
and transporting fish upstream to reduce the time it takes
them to reach spawning locations. Id. ¶ 38.
Exelon agreed to haul fish upstream from the Conowingo
Reservoir and past three additional dams to ensure that a
high percentage of fish complete their migrations
successfully. Id.
C.
The MDE Certification
On
April 29, 2013 FERC issued a formal request to MDE for a
state water-quality certification (Certification) for the
Conowingo Project.
On
January 31, 2014, Exelon submitted its request to MDE for a
Section 401 certification in connection with the FERC
relicensing of the Conowingo Project. Along with its request,
Exelon submitted copies of the studies that it had already
completed. Under the Clean Water Act, Maryland had one year
to submit a certification or waive its rights. See
33 U.S.C. § 1341(a)(1); Hoopa Valley Tribe v.
FERC, 913 F.3d 1099 (D.C. Cir. 2019).
MDE
asked Exelon to conduct an additional study on the impacts of
sediment transport on water quality in the Susquehanna River
and the Bay (the Sediment Study). Compl. ¶ 45. As a
result, Exelon entered into an agreement with MDE to work
with Maryland agencies, the Army Corps of Engineers, the
United States Geological Survey, the University of Maryland
Center for Environmental Science, and EPA to design and
conduct a multi-year Sediment Study, at a cost to Exelon of
$3.5 million. Id. ¶¶ 46-47.
In
order to provide time for the Sediment Study requested by
Maryland, Exelon withdrew its January 2014 application in
December 2014. Id. ¶ 48. Exelon refiled the
application for a Section 401 certification on March 3, 2015
and then withdrew it on February 5, 2016 because the Sediment
Study was not completed. Id. ¶ 49. Exelon
refiled its application on April 25, 2016 and again withdrew
it on February 17, 2017. Id. ¶ 50.
Finally,
on March 13, 2017, MDE indicated that it would be ready to
receive Exelon's application for the Certification no
later than May 18, 2017. Id. ¶ 52. Exelon
resubmitted its application on May 17, 2017. Id.
¶ 53.
Exelon
alleges that “[t]he studies that [it] submitted to MDE
. . . and the information in the record before MDE
demonstrate that the Conowingo Project is not the source of
pollution entering the Susquehanna River. They also
demonstrate that the Project is meeting all applicable state
water-quality standards in waters immediately
downstream.” Id. ¶ 54. In addition,
“[t]he Sediment Study confirmed that Conowingo Project
operations introduce negligible amounts of sediment into the
water, ...