California v. Federal Energy Regulatory Commission

A project operator applied for a Federal Energy Regulatory Commission (FERC) (defendant) license to build and operate a hydropower project near a California stream. The license required the project to maintain minimum bypass flows in the stream to protect downstream fish resources. FERC adopted the flow rates recommended by the project operator and rejected the significantly higher flow rates recommended by the California Department of Fish and Game (CDFG). The licensee also applied for state water permits with the State Water Resources Control Board (WRCB). The WRCB issued a permit that conformed to the FERC’s interim minimum-flow requirements but reserved the right to set different permanent minimum-flow rates. The FERC issued an order directing the licensee to comply with the minimum-flow requirements of the federal permit. The FERC concluded that setting minimum flows rested within its exclusive jurisdiction under the Federal Power Act (FPA). California (plaintiff), acting on behalf of WRCB, sought to ensure that the project’s operators maintained water flowing in the stream sufficient, in California’s judgment, to protect the stream’s fish. California and the FERC disputed the meaning of § 27 of the FPA, which provides the most unambiguous indication of how Congress intended to allocate state and federal regulatory authority over hydroelectric powers. The Court of Appeals for the Ninth Circuit affirmed. The United States Supreme Court granted certiorari.