Vermont Yankee Nuclear Power Corp. v.

Natural Resources Defense Council, Inc.

No. 76-419

Argued November 28, 1977

Decided April 3, 1978 *

435 U.S. 519

CERTIORARI TO THE UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Syllabus



In No. 76-419, after extensive hearings before the Atomic Safety and

Licensing Board (Licensing Board) and over respondents' objections, the

Atomic Energy Commission (AEC) granted petitioner Vermont Yankee Nuclear

Power Corp. a license to operate a nuclear power plant, and this ruling

was affirmed by the Atomic Safety and Licensing Appeal Board (Appeal

Board).  Subsequently, the AEC, specifically referring to the Appeal

Board's decision, instituted rulemaking proceedings to deal with the

question of considering environmental effects associated with the

uranium fuel cycle in the individual cost-benefit analyses for

light-watercooled nuclear power reactors.  In these proceedings, the

Licensing Board was not to use full formal adjudicatory procedures.

Eventually, as a result of these rulemaking proceedings, the AEC issued

a so-called fuel cycle rule.  At the same time, the AEC approved the

procedures used at the hearing; indicated that the record, including the

Environmental Survey, provided an adequate data base for the rule

adopted; and ruled that, to the extent the rule differed from the Appeal

Board's decision, such decision had no further precedential

significance, but that, since the environmental effects of the uranium

fuel cycle had been shown to be relatively insignificant, it was

unnecessary to apply the rule to Vermont Yankee's environmental reports

submitted prior to the rule's effective date or to the environmental

statements circulated for comment prior to such date.  Respondents

appealed from both the AEC's adoption of the fuel cycle rule and its

decision to grant Vermont Yankee's license.  With respect to the

license, the Court of Appeals first ruled that, in the absence of

effective rulemaking proceedings, the AEC must deal with the

environmental impact of fuel reprocessing and disposal in individual

licensing proceedings, and went on to hold that, despite the fact that

it appeared that the AEC employed all the procedures required by the

Administrative Procedure Act (APA) in 5 U.S.C.  553 (1976 ed.) and more,

[435 U.S. 520] the rulemaking proceedings were inadequate, and

overturned the rule, and, accordingly, the AEC's determination with

respect to the license was also remanded for further proceedings.  In

No. 76-528, after examination of a report of the Advisory Committee on

Reactor Safeguards (ACRS) and extensive hearings, and over respondent

intervenors' objections, the AEC granted petitioner Consumers Power Co.

a permit to construct two nuclear reactors, and this ruling was affirmed

by the Appeal Board.  At about this time, the Council on Environmental

Quality revised its regulations governing the preparation of

environmental impact statements so as to mention for the first time the

necessity for considering energy conservation as one of the alternatives

to a proposed project.  In view of this development and a subsequent AEC

ruling indicating that all evidence of energy conservation should not

necessarily be barred at the threshold of AEC proceedings, one of the

intervenors moved to reopen the permit proceedings so that energy

conservation could be considered, but the AEC declined to reopen the

proceedings.  Respondents appealed from the granting of the construction

permit.  The Court of Appeals held that the environmental impact

statement for the construction of the reactors was fatally defective for

failure to examine energy conservation as an alternative to plants of

this size, and that the ACRS report was inadequate, and should have been

returned to the ACRS for further elucidation, understandable to a

layman, and remanded the case for appropriate consideration of waste

disposal and other unaddressed issues.



Held:



1. Generally speaking, 5 U.S.C.  553 (1976 ed.) establishes the maximum

procedural requirements that Congress was willing to have the courts

impose upon federal agencies in conducting rulemaking proceedings, and

while agencies are free to grant additional procedural rights in the

exercise of their discretion, reviewing courts are generally not free to

impose them if the agencies have not chosen to grant them.  And, even

apart from the APA, the formulation of procedures should basically be

left within the discretion of the agencies to which Congress has

confided the responsibility for substantive judgments.



2. The Court of Appeals in these cases has seriously misread or

misapplied such statutory and decisional law cautioning reviewing courts

against engrafting their own notions of proper procedures upon agencies

entrusted with substantive functions by Congress, and moreover, as to

the Court of Appeals' decision with respect to agency action taken after

full adjudicatory hearings, it improperly intruded into the agency's

decisionmaking process.



(a) In No. 76-419, the AEC acted well within its statutory authority

[435 U.S. 521] when it considered the environmental impact of the fuel

processes when licensing nuclear reactors.



(b) Nothing in the APA, the National Environmental Policy Act of 1969

(NEPA), the circumstances of the case in No. 76-419, the nature of the

issues being considered, past agency practice, or the statutory mandate

under which the AEC operates permitted the Court of Appeals to review

and overturn the rulemaking proceeding on the basis of the procedural

devices employed (or not employed) by the AEC, so long as the AEC used

at least the statutory minima, a matter about which there is no doubt.



(c) As to whether the challenged rule in No. 76-419 finds sufficient

justification in the administrative proceedings that it should be upheld

by the reviewing court, the case is remanded so that the Court of

Appeals may review the rule as the APA provides.  The court should

engage in this kind of review, and not stray beyond the judicial

province to explore the procedural format or to impose upon the agency

its own notion of which procedures are "best" or most likely to further

some vague, undefined public good.



(d) In No. 76-528, the Court of Appeals was wrong in holding that

rejection of energy conservation on the basis of the "threshold test"

was capricious and arbitrary as being inconsistent with the NEPA's basic

mandate to the AEC, since the court's rationale basically misconceives

not only the scope of the agency's Statutory responsibility, but also

the nature of the administrative process, the thrust of the agency's

decision, and the type of issues the intervenors were trying to raise.

The court seriously mischaracterized the AEC's "threshold test" as

placing "heavy substantive burdens on intervenors."  On the contrary,

the AEC's stated procedure as requiring a showing sufficient to require

reasonable minds to inquire further is a procedure well within the

agency's discretion.



(e) The Court of Appeals' holding in No. 76-528 that the Licensing Board

should have returned the ACRS report to the ACRS for further elaboration

is erroneous as being an unjustifiable intrusion into the administrative

process, and there is nothing in the relevant statutes to justify what

the court did.



No. 76-19, 178 U.S.App.D.C. 336, 547 F.2d 633, and No. 76-528, 178

U.S.App.D.C. 325, 547 F.2d 622, reversed and remanded.



REHNQUIST, J., delivered the opinion of the Court, in which all other

Members joined except BLACKMUN and POWELL, JJ., who took no part in the

consideration or decision of the cases. [435 U.S. 523] REHNQUIST, J.,

lead opinion



MR. JUSTICE REHNQUIST delivered the opinion of the Court.



In 1946, Congress enacted the Administrative Procedure Act, which, as we

have noted elsewhere, was not only "a new, basic and comprehensive

regulation of procedures in many agencies," Won Yang Sung v. McGrath,

339 U.S. 33 (195), but was also a legislative enactment which settled

"long-continued and hard-fought contentions, and enacts a formula upon

which opposing social and political forces have come to rest."  Id. at

40.  Section 4 of the Act, 5 U.S.C.  553 (1976 ed.), dealing with

rulemaking, requires in subsection (b) that [435 U.S. 524] "notice of

proposed rule making shall be published in the Federal Register . . . ,"

describes the contents of that notice, and goes on to require in

subsection (c) that, after the notice, the agency shall give interested

persons an opportunity to participate in the rule making through

submission of written data, views, or arguments with or without

opportunity for oral presentation.  After consideration of the relevant

matter presented, the agency shall incorporate in the rules adopted a

concise general statement of their basis and purpose. Interpreting this

provision of the Act in United States v. Allegheny-Ludlum Steel Corp.,

406 U.S. 742 (1972), and United States v. Florida East Coast R. Co., 410

U.S. 224 (1973), we held that, generally speaking, this section of the

Act established the maximum procedural requirements which Congress was

willing to have the courts impose upon agencies in conducting rulemaking

procedures.  Agencies are free to grant additional procedural rights in

the exercise of their discretion, but reviewing courts are generally not

free to impose them if the agencies have not chosen to grant them.  This

is not to say necessarily that there are no circumstances which would

ever justify a court in overturning agency action because of a failure

to employ procedures beyond those required by the statute.  But such

circumstances, if they exist, are extremely rare.



Even apart from the Administrative Procedure Act, this Court has, for

more than four decades, emphasized that the formulation of procedures

was basically to be left within the discretion of the agencies to which

Congress had confided the responsibility for substantive judgments.  In

FCC v. Schreiber, 381 U.S. 279, 290 (1965), the Court explicated [435

U.S. 525] this principle, describing it as an outgrowth of the

congressional determination that administrative agencies and

administrators will be familiar with the industries which they regulate

and will be in a better position than federal courts or Congress itself

to design procedural rules adapted to the peculiarities of the industry

and the tasks of the agency involved. The Court there relied on its

earlier case of FCC v. Pottsville Broadcasting Co., 309 U.S. 134, 138

(1940), where it had stated that a provision dealing with the conduct of

business by the Federal Communications Commission delegated to the

Commission the power to resolve subordinate questions of procedure . . .

[such as] the scope of the inquiry, whether applications should be heard

contemporaneously or successively, whether parties should be allowed to

intervene in one another's proceedings, and similar questions.



It is in the light of this background of statutory and decisional law

that we granted certiorari to review two judgments of the Court of

Appeals for the District of Columbia Circuit because of our concern that

they had seriously misread or misapplied this statutory and decisional

law cautioning reviewing courts against engrafting their own notions of

proper procedures upon agencies entrusted with substantive functions by

Congress.  429 U.S. 1090 (1977).  We conclude that the Court of Appeals

has done just that in these cases, and we therefore remand them to it

for further proceedings.  We also find it necessary to examine the Court

of Appeals' decision with respect to agency action taken after full

adjudicatory hearings.  We again conclude that the court improperly

intruded into the agency's decisionmaking process, making it necessary

for us to reverse and remand with respect to this part of the cases

also. I A



Under the Atomic Energy Act of 1954, 68 Stat. 919, as amended, 42 U.S.C.

2011 et seq., the Atomic Energy Commission [435 U.S. 526] was given

broad regulatory authority over the development of nuclear energy. Under

the terms of the Act, a utility seeking to construct and operate a

nuclear power plant must obtain a separate permit or license at both the

construction and the operation stage of the project.  See 42 U.S.C.

2133, 2232, 2235, 2239.  In order to obtain the construction permit, the

utility must file a preliminary safety analysis report, an environmental

report, and certain information regarding the antitrust implications of

the proposed project.  See 10 CFR  2.101, 50.30(f), 50.33a, 50.34(a)

(1977).  This application then undergoes exhaustive review by the

Commission's staff and by the Advisory Committee on Reactor Safeguards

(ACRS), a group of distinguished experts in the field of atomic energy.

Both groups submit to the Commission their own evaluations, which then

become part of the record of the utility's application.  See 42 U.S.C. 

2039, 2232(b).  The Commission staff also undertakes the review required

by the National Environmental Policy Act of 1969 (NEPA), 83 Stat. 852,

42 U.S.C.  4321 et seq., and prepares a draft environmental impact

statement, which, after being circulated for comment, 10 CFR 51.22-51.25

(1977), is revised and becomes a final environmental impact statement.  

51.26.  Thereupon, a three-member Atomic Safety and Licensing Board

conducts a public adjudicatory hearing, 42 U.S.C.  2241, and reaches a

decision which can be [435 U.S. 527] appealed to the Atomic Safety and

Licensing Appeal Board, and currently, in the Commission's discretion,

to the Commission itself.  10 CFR  2.714, 2.721, 2.786, 2.787 (1977). 

The final agency decision may be appealed to the courts of appeals.  42

U.S.C.  2239; 28 U.S.C.  2342.  The same sort of process occurs when the

utility applies for a license to operate the plant, 10 CFR  50.34(b)

(1977), except that a hearing need only be held in contested cases, and

may be limited to the matters in controversy.  See 42 U.S.C.  2239(a);

10 CFR  2.105 (1977); 10 CFR pt. 2, App. A, V(f) (1977).



These cases arise from two separate decisions of the Court of Appeals

for the District of Columbia Circuit.  In the first, the court remanded

a decision of the Commission to grant a license to petitioner Vermont

Yankee Nuclear Power Corp. to operate a nuclear power plant.  Natural

Resources Defense Council v. NRC, 178 U.S.App.D.C. 336, 547 F.2d 633

(1976).  In the second, the court remanded a decision of that same

agency to grant a permit to petitioner Consumers Power Co. to construct

two pressurized water nuclear reactors to generate electricity and

steam.  Aeschliman v. NRC, 178 U.S.App.D.C. 325, 547 F.2d 622 (1976). B



In December, 1967, after the mandatory adjudicatory hearing and

necessary review, the Commission granted petitioner Vermont Yankee a

permit to build a nuclear power plant in Vernon, Vt.  See 4 A.E.C. 36

(1967).  Thereafter, Vermont Yankee applied for an operating license.

Respondent Natural Resources Defense Council (NRDC) objected to the

granting [435 U.S. 528] of a license, however, and therefore a hearing

on the application commenced on August 10, 1971.  Excluded from

consideration at the hearings, over NRDC's objection, was the issue of

the environmental effects of operations to reprocess fuel or dispose of

wastes resulting from the reprocessing operations.  This ruling was

affirmed by the Appeal Board in June, 1972.



In November, 1972, however, the Commission, making specific reference to

the Appeal Board's decision with respect to the Vermont Yankee license,

instituted rulemaking proceedings that would specifically deal with the

question of consideration of environmental effects associated with the

uranium fuel cycle in the individual cost-benefit analyses for light

water cooled nuclear power reactors. App. 352.  The notice of proposed

rulemaking offered two alternatives, both predicated on a report

prepared by the Commission's staff entitled Environmental Survey of the

Nuclear Fuel Cycle.  The first would have required no quantitative

evaluation of the environmental hazards of fuel reprocessing or

disposal. because the Environmental Survey had found them to be slight.

The second would have specified numerical values for the environmental

impact of this part of the fuel cycle, which values would then be

incorporated into a table, along with the other relevant factors, to

determine the overall cost-benefit balance for each operating license.

See id. at 356-357.



Much of the controversy in this case revolves around the [435 U.S. 529]

procedures used in the rulemaking hearing which commenced in February,

1973.  In a supplemental notice of hearing, the Commission indicated

that, while discovery or cross-examination would not be utilized, the

Environmental Survey would be available to the public before the

hearing, along with the extensive background documents cited therein.

All participants would be given a reasonable opportunity to present

their position, and could be represented by counsel if they so desired.

Written and, time permitting, oral statements would be received and

incorporated into the record.  All persons giving oral statements would

be subject to questioning by the Commission.  At the conclusion of the

hearing, a transcript would be made available to the public, and the

record would remain open for 30 days to allow the filing of supplemental

written statements.  See generally id. at 361-363.  More than 40

individuals and organizations representing a wide variety of interests

submitted written comments.  On January 17, 1973, the Licensing Board

held a planning session to schedule the appearance of witnesses and to

discuss methods for compiling a record.  The hearing was held on

February 1 and 2, with participation by a number of groups, including

the Commission's staff, the United States Environmental Protection

Agency, a manufacturer of reactor equipment, a trade association from

the nuclear industry, a group of electric utility companies, and a group

called Consolidated National Intervenors, which represented 79 groups

and individuals, including respondent NRDC.



After the hearing, the Commission's staff filed a supplemental document

for the purpose of clarifying and revising the Environmental Survey.

Then the Licensing Board forwarded its report to the Commission without

rendering any decision.  The Licensing Board identified as the principal

procedural question the propriety of declining to use full formal

adjudicatory procedures.  The major substantive issue was the technical

adequacy of the Environmental Survey. [435 U.S. 530]



In April, 1974, the Commission issued a rule which adopted the second of

the two proposed alternatives described above.  The Commission also

approved the procedures used at the hearing, and indicated that the

record, including the Environmental Survey, provided an "adequate data

base for the regulation adopted."  Id. at 392.  Finally, the Commission

ruled that, to the extent the rule differed from the Appeal Board

decisions in Vermont Yankee, "those decisions have no further

precedential significance," id. at 386, but that, since the

environmental effects of the uranium fuel cycle have been shown to be

relatively insignificant, . . . it is unnecessary to apply the amendment

to applicant's environmental reports submitted prior to its effective

date or to Final Environmental Statements for which Draft Environmental

Statements have been circulated for comment prior to the effective date,

id. at 395



Respondents appealed from both the Commission's adoption of the rule and

its decision to grant Vermont Yankee's license to the Court of Appeals

for the District of Columbia Circuit. C



In January, 1969, petitioner Consumers Power Co. applied for a permit to

construct two nuclear reactors in Midland, [435 U.S. 531] Mich.

Consumers Power's application was examined by the Commission's staff and

the ACRS.  The ACRS issued reports which discussed specific problems and

recommended solutions.  It also made reference to "other problems" of a

more generic nature, and suggested that efforts should be made to

resolve them with respect to these, as well as all other, projects.  Two

groups, one called Saginaw and another called Mapleton, intervened and

opposed the application.  Saginaw filed with the Board a number of

environmental contentions, directed over 300 interrogatories to the

ACRS, attempted to depose the chairman of the ACRS, and requested

discovery of various ACRS documents.  The Licensing Board denied the

various discovery requests directed to the ACRS. Hearings were then held

on numerous radiological health and safety issues.{10}  Thereafter, the

Commission's staff issued a draft [435 U.S. 532] environmental impact

statement.  Saginaw submitted 119 environmental contentions which were

both comments on the proposed draft statement and a statement of

Saginaw's position in the upcoming hearings.  The staff revised the

statement and issued a final environmental statement in March, 1972. 

Further hearings were then conducted during May and June, 1972. 

Saginaw, however, choosing not to appear at or participate in these

latter hearings, indicated that it had "no conventional findings of fact

to set forth" and had not "chosen to search the record and respond to

this proceeding by submitting citations of matters which we believe were

proved or disproved."  See App. 190 n. 9.  But the Licensing Board,

recognizing its obligations to "independently consider the final balance

among conflicting environmental factors in the record," nevertheless

treated as contested those issues "as to which intervenors introduced

affirmative evidence or engaged in substantial cross-examination."  Id.

at 205, 191.



At issue now are 17 of those 119 contentions which are claimed to raise

questions of "energy conservation."  The Licensing Board indicated that,

as far as appeared from the record, the demand for the plant was made up

of normal industrial and residential use.  Id. at 207.  It went on to

state that it was "beyond our province to inquire into whether the

customary uses being made of electricity in our society are `proper' or

`improper.'"  Ibid.  With respect to claims that Consumers Power

stimulated demand by its advertising the Licensing Board indicated that

[n]o evidence was offered on this point, and, absent some evidence that

Applicant is creating abnormal demand, the Board did not consider the

[435 U.S. 533] question. Id. at 207-208.  The Licensing Board also

failed to consider the environmental effects of fuel reprocessing or

disposal of radioactive wastes.  The Appeal Board ultimately affirmed

the Licensing Board's grant of a construction permit, and the Commission

declined to further review the matter.



At just about the same time, the Council on Environmental Quality

revised its regulations governing the preparation of environmental

impact statements.  38 Fed.Reg. 20550 (1973).  The regulations mentioned

for the first time the necessity of considering in impact statements

energy conservation as one of the alternatives to a proposed project.

The new guidelines were to apply only to final impact statements filed

after January 28, 1974.  Id. at 20557.  Thereafter, on November 6, 1973,

more than a year after the record had been closed in the Consumers Power

case and while that case was pending before the Court of Appeals, the

Commission ruled in another case that, while its statutory power to

compel conservation was not clear, it did not follow that all evidence

of energy conservation issues should therefore be barred at the

threshold.  In re Niagara Mohawk Power Corp., 6 A.E.C. 995 (1973).

Saginaw then moved the Commission to clarify its ruling and reopen the

Consumers Power proceedings.



In a lengthy opinion, the Commission declined to reopen the proceedings.

The Commission first ruled it was required to consider only energy

conservation alternatives which were "`reasonably available,'" would, in

their aggregate effect, curtail demand for electricity to a level at

which the proposed facility would not be needed, and were susceptible of

a reasonable degree of proof.  App. 332.  It then determined, after a

thorough examination of the record, that not all of Saginaw's

contentions met these threshold tests.  Id. at 334-340.  It further

determined that the Board had been willing at all times to take evidence

on the other contentions.  Saginaw had simply failed to present any such

evidence.  The [435 U.S. 534] Commission further criticized Saginaw for

its total disregard of even those minimal procedural formalities

necessary to give the Board some idea of exactly what was at issue.  The

Commission emphasized that, [p]articularly in these circumstances,

Saginaw's complaint that it was not granted a hearing on alleged energy

conservation issues comes with ill grace.{11} Id. at 342.  And in

response to Saginaw's contention that, regardless of whether it properly

raised the issues, the Licensing Board must consider all environmental

issues, the Commission basically agreed, as did the Board itself, but

further reasoned that the Board must have some workable procedural

rules, and these rules, in this setting, must take into account that

energy conservation is a novel and evolving concept.  NEPA "does not

require a `crystal ball' inquiry."  Natural Resources Defense Council v.

Morton, [148 U.S.App.D.C. 5, 15, 458 F.2d 827, 837 (1972)].  This

consideration has led us to hold that we will not apply Niagara

retroactively.  As we gain experience on a case-by-case basis and,

hopefully, feasible energy conservation techniques emerge, the

applicant, staff, and licensing boards will have obligations to develop

an adequate record on these issues in appropriate cases, whether or not

they are raised by intervenors.



However, at this emergent stage of energy conservation principles,

intervenors also have their responsibilities.  They must state clear and

reasonably specific energy conservation contentions in a timely fashion.

Beyond that, they have a burden of coming forward with some [435 U.S.

535] affirmative showing if they wish to have these novel contentions

explored further.{12} Id. at 344 (footnotes omitted).  Respondents then

challenged the granting of the construction permit in the Court of

Appeals for the District of Columbia Circuit. D



With respect to the challenge of Vermont Yankee's license, the court

first ruled that, in the absence of effective rulemaking

proceedings,{13} the Commission must deal with the environmental impact

of fuel reprocessing and disposal in individual licensing proceedings. 

178 U.S.App.D.C. at 344, 547 F.2d at 641.  The court then examined the

rulemaking proceedings and, despite the fact that it appeared that the

agency employed all the procedures required by 5 U.S.C.  553 (1976 ed.)

and more, the court determined the proceedings to be inadequate, and

overturned the rule.  Accordingly, the Commission's determination with

respect to Vermont Yankee's license was also remanded for further

proceedings.{14}  178 U.S. App.D.C. at 358, 547 F.2d at 655. [435 U.S.

536]



With respect to the permit to Consumers Power, the court first held that

the environmental impact statement for construction of the Midland

reactors was fatally defective for [435 U.S. 537] failure to examine

energy conservation as an alternative to a plant of this size.  178

U.S.App.D.C. at 331, 547 F.2d at 628.  The court also thought the report

by ACRS was inadequate, although it did not agree that discovery from

individual ACRS members was the proper way to obtain further explication

of the report.  Instead, the court held that the Commission should have

sua sponte sent the report back to the ACRS for further elucidation of

the "other problems" and their resolution.  Id. at 335, 547 F.2d at 632.

Finally, the court ruled that the fuel cycle issues in this case were

controlled by NRDC v. NRC, discussed above, and remanded for appropriate

consideration of waste disposal and other unaddressed fuel cycle issues

as described in that opinion.  178 U.S.App.D.C. at 335, 547 F.2d at 632.

[435 U.S. 538] II A



Petitioner Vermont Yankee first argues that the Commission may grant a

license to operate a nuclear reactor without any consideration of waste

disposal and fuel reprocessing.  We find, however, that this issue is no

longer presented by the record in this case.  The Commission does not

contend that it is not required to consider the environmental impact of

the spent fuel processes when licensing nuclear power plants.  Indeed,

the Commission has publicly stated subsequent to the Court of Appeals'

decision in the instant case that consideration of the environmental

impact of the back end of the fuel cycle in the environmental impact

statements for individual LWR's [light-water power reactors] would

represent a full and candid assessment of costs and benefits consistent

with the legal requirements and spirit of NEPA. 41 Fed Reg. 45849

(1976).  Even prior to the Court of Appeals' decision, the Commission

implicitly agreed that it would consider the back end of the fuel cycle

in all licensing proceedings:  it indicated that it was not necessary to

reopen prior licensing proceedings, because "the environmental effects

of the uranium fuel cycle have been shown to be relatively

insignificant," and thus incorporation of those effects into the

cost-benefit analysis would not change the results of such licensing

proceedings.  App 395.  Thus, at this stage of the proceedings, the only

question presented for review in this regard is whether the Commission

may consider the environmental impact of the fuel processes when

licensing nuclear reactors.  In addition to the weight which normally

attaches to the agency's determination of such a question, other reasons

support the Commission's conclusion.



Vermont Yankee will produce annually well over 100 pounds of radioactive

wastes, some of which will be highly toxic.  The Commission itself, in a

pamphlet published by its [435 U.S. 539] information office, clearly

recognizes that these wastes "pose the most severe potential health

hazard. . . ."  U.S. Atomic Energy Commission, Radioactive Wastes 12

(1965).  Many of these substances must be isolated for anywhere from 600

to hundreds of thousands of years.  It is hard to argue that these

wastes do not constitute "adverse environmental effects which cannot be

avoided should the proposal be implemented," or that, by operating

nuclear power plants, we are not making "irreversible and irretrievable

commitments of resources."  42 U.S.C.  4332(2)(C)(ii), (v).  As the

Court of Appeals recognized, the environmental impact of the radioactive

wastes produced by a nuclear power plant is analytically

indistinguishable from the environmental effects of "the stack gases

produced by a coal-burning power plant."  178 U.S.App.D.C. at 341, 547

F.2d at 638.  For these reasons, we hold that the Commission acted well

within its statutory authority when it considered the back end of the

fuel cycle in individual licensing proceedings. B



We next turn to the invalidation of the fuel cycle rule.  But before

determining whether the Court of Appeals reached a permissible result,

we must determine exactly what result it did reach, and, in this case,

that is no mean feat.  Vermont Yankee argues that the court invalidated

the rule because of the inadequacy of the procedures employed in the

proceedings.  Brief for Petitioner in No. 76-419, pp. 30-38.

Respondents, on the other hand, labeling petitioner's view of the

decision a "straw man," argue to this Court that the court merely held

that the record was inadequate to enable the reviewing court to

determine whether the agency had fulfilled its statutory obligation.

Brief for Respondents in No. 76-419, pp. 28-30, 40.  But we

unfortunately have not found the parties' characterization of the

opinion to be entirely reliable; it appears here, as in Orloff v.

Willoughby, 345 U.S. 83, 87 (1953), that, [435 U.S. 540] "in this Court,

the parties changed positions as nimbly as if dancing a quadrille."{15}



After a thorough examination of the opinion itself, we conclude [435

U.S. 541] that, while the matter is not entirely free from doubt, the

majority of the Court of Appeals struck down the rule because of the

perceived inadequacies of the procedures employed in the rulemaking

proceedings.  The court first determined the intervenors' primary

argument to be that the decision to preclude "discovery or

cross-examination" denied them a meaningful opportunity to participate

in the proceedings as guaranteed by due process. 178 U.S.App.D.C. at

346, 547 F.2d at 643.  The court then went on to frame the issue for

decision thus: Thus, we are called upon to decide whether the procedures

provided by the agency were sufficient to ventilate the issues. Ibid.,

547 F.2d at 643.  The court conceded that, absent extraordinary

circumstances, it is improper for a reviewing court to prescribe the

procedural format an agency must follow, but it likewise clearly thought

it entirely appropriate to "scrutinize the record as a whole to insure

that genuine opportunities to participate in a meaningful way were

provided. . . ."  Id. at 347, 547 F.2d at 644.  The court also refrained

from actually ordering the agency to follow any specific procedures, id.

at 356-357, 547 F.2d at 653-654, but there is little doubt in our minds

that [435 U.S. 542] the ineluctable mandate of the court's decision is

that the procedures afforded during the hearings were inadequate.  This

conclusion is particularly buttressed by the fact that after the court

examined the record, particularly the testimony of Dr. Pittman, and

declared it insufficient, the court proceeded to discuss at some length

the necessity for further procedural devices or a more "sensitive"

application of those devices employed during the proceedings.  Ibid. The

exploration of the record and the statement regarding its insufficiency

might initially lead one to conclude that the court was only examining

the sufficiency of the evidence, but the remaining portions of the

opinion dispel any doubt that this was certainly not the sole, or even

the principal, basis of the decision.  Accordingly, we feel compelled to

address the opinion on its own terms, and we conclude that it was wrong.



In prior opinions, we have intimated that, even in a rulemaking

proceeding, when an agency is making a "`quasi-judicial'" determination

by which a very small number of persons are "`exceptionally affected, in

each case upon individual grounds,'" in some circumstances, additional

procedures may be required in order to afford the aggrieved individuals

due process.{16}  United States v. Florida East Coast R. Co., 410 U.S.

at 242, 245, quoting from Bi-Metallic Investment Co. v. State Board of

Equalization, 239 U.S. 441, 446 (1915).  It might also be true, although

we do not think the issue is presented in this case, and accordingly do

not decide it, that a totally unjustified departure from well settled

agency procedures of long standing might require judicial

correction.{17} [435 U.S. 543]



But this much is absolutely clear.  Absent constitutional constraints or

extremely compelling circumstances, the administrative agencies "should

be free to fashion their own rules of procedure, and to pursue method of

inquiry capable of permitting them to discharge their multitudinous

duties." FCC v. Schreiber, 381 U.S. at 290, quoting from FCC v.

Pottsville [435 U.S. 544] Broadcasting Co., 309 U.S. at 143.  Indeed,

our cases could hardly be more explicit in this regard.  The Court has,

as we noted in FCC v. Schreiber, supra at 290, and n. 17, upheld this

principle in a variety of applications,{18} including that case where

the District Court, instead of inquiring into the validity of the

Federal Communications Commission's exercise of its rulemaking

authority, devised procedures to be followed by the agency on the basis

of its conception of how the public and private interest involved could

best be served.  Examining  4(j) of the Communications Act of 1934, the

Court unanimously held that the Court of Appeals erred in upholding that

action.  And the basic reason for this decision was the Court of

Appeals' serious departure from the very basic tenet of administrative

law that agencies should be free to fashion their own rules of

procedure.



We have continually repeated this theme through the years, most recently

in FPC v. Transcontinental Gas Pipe Line Corp., 423 U.S. 326 (1976),

decided just two Terms ago.  In that case, in determining the proper

scope of judicial review of agency action under the Natural Gas Act, we

held that, while a court may have occasion to remand an agency decision

because of the inadequacy of the record, the agency should normally be

allowed to exercise its administrative discretion in deciding how, in

light of internal organization considerations, it may best proceed to

develop the needed evidence, and how its prior decision should be

modified in light of such evidence as develops. Id. at 333.  We went on

to emphasize: At least in the absence of substantial justification for

doing otherwise, a reviewing court may not, after determining that

additional evidence is requisite for adequate [435 U.S. 545] review,

proceed by dictating to the agency the methods, procedures, and time

dimension of the needed inquiry and ordering the results to be reported

to the court without opportunity for further consideration on the basis

of the new evidence by the agency.  Such a procedure clearly runs the

risk of "propel[ling] the court into the domain which Congress has set

aside exclusively for the administrative agency."  SEC v. Chenery Corp.,

332 U.S. 194, 196 (1947). Ibid.



Respondent NRDC argues that  4 of the Administrative Procedure Act, 5

U.S.C.  553 (1976 ed.), merely establishes lower procedural bounds, and

that a court may routinely require more than the minimum when an

agency's proposed rule addresses complex or technical factual issues or

"Issues of Great Public Import."  Brief for Respondents in No. 76-419,

p. 49.  We have, however, previously shown that our decisions reject

this view.  Supra at 542 to this page.  We also think the legislative

history, even the part which it cites, does not bear out its contention.

The Senate Report explains what eventually became  4 thus:



This subsection states . . . the minimum requirements of public

rulemaking procedure short of statutory hearing.  Under it, agencies

might in addition confer with industry advisory committees, consult

organizations, hold informal "hearings," and the like.  Considerations

of practicality, necessity, and public interest . . . will naturally

govern the agency's determination of the extent to which public

proceedings should go.  Matters of great import, or those where the

public submission of facts will be either useful to the agency or a

protection to the public, should naturally be accorded more elaborate

public procedures. S.Rep. No. 752, 79th Cong., 1st Sess., 14-15 (1945).

The House Report is in complete accord: "[U]niformity has been found

possible and desirable for all classes of both equity and law actions in

the courts. . . .   [435 U.S. 546] It would seem to require no argument

to demonstrate that the administrative agencies, exercising but a

fraction of the judicial power, may likewise operate under uniform rules

of practice and procedure, and that they may be required to remain

within the terms of the law as to the exercise of both quasi-legislative

and quasi-judicial power." *    *    *    *



The bill is an outline of minimum essential rights and procedures. . . .

It affords private parties a means of knowing what their rights are and

how they may protect them . . . . *    *    *    *



. . .  [The bill contains] the essentials of the different forms of

administrative proceedings. . . . H.R.Rep. No.1980, 79th Cong., 2d

Sess., 9, 117 (1946).  And the Attorney General's Manual on the

Administrative Procedure Act 31, 35 (1947), a contemporaneous

interpretation previously given some deference by this Court because of

the role played by the Department of Justice in drafting the

legislation,{19} further confirms that view.  In short, all of this

leaves little doubt that Congress intended that the discretion of the

agencies, and not that of the courts, be exercised in determining when

extra procedural devices should be employed.



There are compelling reasons for construing  4 in this manner.  In the

first place, if courts continually review agency proceedings to

determine whether the agency employed procedures which were, in the

court's opinion, perfectly tailored to reach what the court perceives to

be the "best" or "correct" result, judicial review would be totally

unpredictable.  And the agencies, operating under this vague injunction

to employ [435 U.S. 547] the "best" procedures and facing the threat of

reversal if they did not, would undoubtedly adopt full adjudicatory

procedures in every instance.  Not only would this totally disrupt the

statutory scheme, through which Congress enacted "a formula upon which

opposing social and political forces have come to rest," Wong Yang Sung

v. McGrath, 339 U.S. at 40, but all the inherent advantages of informal

rulemaking would be totally lost.{20}



Secondly, it is obvious that the court in these cases reviewed the

agency's choice of procedures on the basis of the record actually

produced at the hearing, 178 U.S.App.D.C. at 347, 547 F.2d at 644, and

not on the basis of the information available to the agency when it made

the decision to structure the proceedings in a certain way.  This sort

of Monday morning quarterbacking not only encourages, but almost

compels, the agency to conduct all rulemaking proceedings with the full

panoply of procedural devices normally associated only with adjudicatory

hearings.



Finally, and perhaps most importantly, this sort of review fundamentally

misconceives the nature of the standard for judicial review of an agency

rule.  The court below uncritically assumed that additional procedures

will automatically result in a more adequate record because it will give

interested parties more of an opportunity to participate in and

contribute to the proceedings.  But informal rulemaking need not be

based solely on the transcript of a hearing held before an agency.

Indeed, the agency need not even hold a formal hearing.  See 5 U.S.C.

553(c) (1976 ed.).  Thus, the adequacy of the "record" in this type of

proceeding is not correlated directly to the type of procedural devices

employed, but rather turns on whether the agency has followed the

statutory mandate of the Administrative Procedure Act or other relevant

statutes.  If the agency is compelled to support [435 U.S. 548] the rule

which it ultimately adopts with the type of record produced only after a

full adjudicatory hearing, it simply will have no choice but to conduct

a full adjudicatory hearing prior to promulgating every rule.  In sum,

this sort of unwarranted judicial examination of perceived procedural

shortcomings of a rulemaking proceeding can do nothing but seriously

interfere with that process prescribed by Congress.



Respondent NRDC also argues that the fact that the Commission's inquiry

was undertaken in the context of NEPA somehow permits a court to require

procedures beyond those specified in  4 of the APA when investigating

factual issues through rulemaking.  The Court of Appeals was apparently

also of this view, indicating that agencies may be required to "develop

new procedures to accomplish the innovative task of implementing NEPA

through rulemaking."  178 U.S.App.D.C. at 356, 547 F.2d at 653.  But we

search in vain for something in NEPA which would mandate such a result.

We have before observed that "NEPA does not repeal by implication any

other statute."  Aberdeen  Rockfish R. Co. v. SCRAP, 422 U.S. 289, 319

(1975).  See also United States v. SCRAP, 412 U.S. 669, 694 (1973).  In

fact, just two Terms ago, we emphasized that the only procedural

requirements imposed by NEPA are those stated in the plain language of

the Act.  Kleppe v. Sierra Club, 427 U.S. 390, 405-406 (1976).  Thus, it

is clear NEPA cannot serve as the basis for a substantial revision of

the carefully constructed procedural specifications of the APA.



In short, nothing in the APA, NEPA, the circumstances of this case, the

nature of the issues being considered, past agency practice, or the

statutory mandate under which the Commission operates permitted the

court to review and overturn the rulemaking proceeding on the basis of

the procedural devices employed (or not employed) by the Commission so

long as the Commission employed at least the statutory minima, a matter

about which there is no doubt in this case. [435 U.S. 549]



There remains; of course, the question of whether the challenged rule

finds sufficient justification in the administrative proceedings that it

should be upheld by the reviewing court.  Judge Tamm, concurring in the

result reached by the majority of the Court of Appeals, thought that it

did not.  There are also intimations in the majority opinion which

suggest that the judges who joined it likewise may have thought the

administrative proceedings an insufficient basis upon which to predicate

the rule in question.  We accordingly remand so that the Court of

Appeals may review the rule as the Administrative Procedure Act

provides.  We have made it abundantly clear before that, when there is a

contemporaneous explanation of the agency decision, the validity of that

action must stand or fall on the propriety of that finding, judged, of

course, by the appropriate standard of review.  If that finding is not

sustainable on the administrative record made, then the Comptroller's

decision must be vacated and the matter remanded to him for further

consideration. Camp v. Pitts, 411 U.S. 138, 143 (1973).  See also SEC v.

Chenery Corp., 318 U.S. 80 (1943).  The court should engage in this kind

of review and not stray beyond the judicial province to explore the

procedural format or to impose upon the agency its own notion of which

procedures are "best" or most likely to further some vague, undefined

public good.{21} III A



We now turn to the Court of Appeals' holding "that rejection of energy

conservation on the basis of the `threshold test' [435 U.S. 550] was

capricious and arbitrary," 178 U.S.App.D.C. at 332, 547 F.2d at 629, and

again conclude the court was wrong.



The Court of Appeals ruled that the Commission's "threshold test" for

the presentation of energy conservation contentions was inconsistent

with NEPA's basic mandate to the Commission.  Id. at 330, 547 F.2d at

627.  The Commission, the court reasoned, is something more than an

umpire who sits back and resolves adversary contentions at the hearing

stage.  Ibid., 547 F.2d at 627.  And when an intervenor's comments

"bring `sufficient attention to the issue to stimulate the Commission's

consideration of it,'" the Commission must undertake its own preliminary

investigation of the proffered alternative sufficient to reach a

rational judgment whether it is worthy of detailed consideration in the

EIS.  Moreover, the Commission must explain the basis for each

conclusion that further consideration of a suggested alternative is

unwarranted. Id. at 331, 547 F.2d at 628, quoting from Indiana &

Michigan Electric Co. v. FPC, 163 U.S.App.D.C. 334, 337, 502 F.2d 336,

339 (1974), cert. denied, 420 U.S. 946 (1975)



While the court's rationale is not entirely unappealing as an abstract

proposition, as applied to this case, we think it basically misconceives

not only the scope of the agency's statutory responsibility, but also

the nature of the administrative process, the thrust of the agency's

decision, and the type of issues the intervenors were trying to raise.



There is little doubt that, under the Atomic Energy Act of 1954, state

public utility commissions or similar bodies are empowered to make the

initial decision regarding the need for power.  42 U.S.C.  2021(k).  The

Commission's prime area of concern in the licensing context, on the

other hand, is national security, public health, and safety.   2132,

2133, 2201.  And it is clear that the need, as that term is

conventionally used, for the power was thoroughly explored in the

hearings.  Even the Federal Power Commission, which regulates [435 U.S.

551] sales in interstate commerce, 16 U.S.C.  824 et seq. (1976 ed.),

agreed with Consumers Power's analysis of projected need.  App. 207.



NEPA, of course, has altered slightly the statutory balance, requiring

"a detailed statement by the responsible official on . . . alternatives

to the proposed action."  42 U.S.C.  4332(C).  But, as should be obvious

even upon a moment's reflection, the term "alternatives" is not

self-defining.  To make an impact statement something more than an

exercise in frivolous boilerplate, the concept of alternatives must be

bounded by some notion of feasibility.  As the Court of Appeals for the

District of Columbia Circuit has itself recognized:



There is reason for concluding that NEPA was not meant to require

detailed discussion of the environmental effects of "alternatives" put

forward in comments when these effects cannot be readily ascertained and

the alternatives are deemed only remote and speculative possibilities,

in view of basic changes required in statutes and policies of other

agencies -- making them available, if at all, only after protracted

debate and litigation not meaningfully compatible with the timeframe of

the needs to which the underlying proposal is addressed. Natural

Resources Defense Council v. Morton, 148 U.S.App.D.C. 5, 15-16, 458 F.2d

827, 837-838 (1972).  See also Life of the Land v. Brinegar, 485 F.2d

460 (CA9 1973), cert. denied, 416 U.S. 961 (1974).  Common sense also

teaches us that the "detailed statement of alternatives" cannot be found

wanting simply because the agency failed to include every alternative

device and thought conceivable by the mind of man.  Time and resources

are simply too limited to hold that an impact statement fails because

the agency failed to ferret out every possible alternative, regardless

of how uncommon or unknown that alternative may have been at the time

the project was approved. [435 U.S. 552]



With these principles in mind we now turn to the notion of "energy

conservation," an alternative the omission of which was thought by the

Court of Appeals to have been "forcefully pointed out by Saginaw in its

comments on the draft EIS."  178 U.S.App.D.C. at 328, 547 F.2d at 625.

Again, as the Commission pointed out, the phrase "energy conservation"

has a deceptively simple ring in this context.  Taken literally, the

phrase suggests a virtually limitless range of possible actions and

developments that might, in one way or another, ultimately reduce

projected demands for electricity from a particular proposed plant. App.

331.  Moreover, as a practical matter, it is hard to dispute the

observation that it is largely the events of recent years that have

emphasized not only the need but also a large variety of alternatives

for energy conservation.  Prior to the drastic oil shortages incurred by

the United States in 1973, there was little serious thought in most

Government circles of energy conservation alternatives.  Indeed, the

Council on Environmental Quality did not promulgate regulations which

even remotely suggested the need to consider energy conservation in

impact statements until August 1, 1973.  See 40 CFR  1500.8(a)(4)

(1977); 38 Fed.Reg. 20554 (1973).  And even then the guidelines were not

made applicable to draft and final statements filed with the Council

before January 28, 1974.  Id. at 20557, 21265.  The Federal Power

Commission likewise did not require consideration of energy conservation

in applications to build hydroelectric facilities until June 19, 1973.

18 CFR pt. 2, App. A.  8.2 (1977); 38 Fed.Reg. 15946, 15949 (1973).  And

these regulations were not made retroactive either.  Id. at 15946.  All

this occurred over a year and a half after the draft environmental

statement for Midland had been prepared, and over a year after the final

environmental statement had been prepared and the hearings completed.



We think these facts amply demonstrate that the concept of

"alternatives" is an evolving one, requiring the agency to [435 U.S.

553] explore more or fewer alternatives as they become better known and

understood.  This was well understood by the Commission, which, unlike

the Court of Appeal, recognized that the Licensing Board's decision had

to be judged by the information then available to it.  And judged in

that light, we have little doubt the Board's actions were well within

the proper bounds of its statutory authority.  Not only did the record

before the agency give every indication that the project was actually

needed, but also there was nothing before the Board to indicate to the

contrary.



We also think the court's criticism of the Commission's "threshold test"

displays a lack of understanding of the historical setting within which

the agency action took place and of the nature of the test itself.  In

the first place, while it is true that NEPA places upon an agency the

obligation to consider every significant aspect of the environmental

impact of a proposed action, it is still incumbent upon intervenors who

wish to participate to structure their participation so that it is

meaningful, so that it alerts the agency to the intervenors' position

and contentions.  This is especially true when the intervenors are

requesting the agency to embark upon an exploration of uncharted

territory, as was the question of energy conservation in the late 1960's

and early 1970's. [C]omments must be significant enough to step over a

threshold requirement of materiality before any lack of agency response

or consideration becomes of concern.  The comment cannot merely state

that a particular mistake was made . . . ; it must show why the mistake

was of possible significance in the results. . . . Portland Cement Assn.

v. Ruckelshaus, 158 U.S.App.D.C. 308, 327, 486 F.2d 375, 394 (1973),

cert. denied sub nom. Portland Cement Cor. v. Administrator, EPA, 417

U.S. 921 (1974).  Indeed, administrative proceedings should not be a

game or a forum to engage in unjustified obstructionism by making [435

U.S. 554] cryptic and obscure reference to matters that "ought to be"

considered, and then, after failing to do more to bring the matter to

the agency's attention, seeking to have that agency determination

vacated on the ground that the agency failed to consider matters

"forcefully presented."  In fact, here, the agency continually invited

further clarification of Saginaw's contentions.  Even without such

clarification it indicated a willingness to receive evidence on the

matters.  But not only did Saginaw decline to further focus its

contentions, it virtually declined to participate, indicating that it

had "no conventional findings of fact to set forth" and that it had not

"chosen to search the record and respond to this proceeding by

submitting citations of matter which we believe were proved or

disproved."



We also think the court seriously mischaracterized the Commission's

"threshold test" as placing "heavy substantive burdens . . . on

intervenors. . . ."  178 U.S.App.D.C. at 330, and n. 11, 547 F.2d at

627, and n. 11.  On the contrary, the Commission explicitly stated:



We do not equate this burden with the civil litigation concept of a

prima facie case, an unduly heavy burden in this setting.  But the

showing should be sufficient to require reasonable minds to inquire

further. App. 344 n. 27.  We think this sort of agency procedure well

within the agency's discretion.



In sum, to characterize the actions of the Commission as "arbitrary or

capricious" in light of the facts then available to it, as described at

length above, is to deprive those words of any meaning.  As we have said

in the past: Administrative consideration of evidence . . . always

creates a gap between the time the record is closed and the time the

administrative decision is promulgated [and, we might add, the time the

decision is judicially reviewed]. . . .  If, upon the coming down of the

order,  [435 U.S. 555] litigants might demand rehearings as a matter of

law because some new circumstance has arisen, some new trend has been

observed, or some new fact discovered, there would be little hope that

the administrative process could ever be consummated in an order that

would not be subject to reopening. ICC v. Jersey City, 322 U.S. 503, 514

(1944).  See also Northern Lines Merger Cases, 396 U.S. 491, 521 (1970).



We have also made it clear that the role of a court in reviewing the

sufficiency of an agency's consideration of environmental factors is a

limited one, limited both by the time at which the decision was made and

by the statute mandating review.



Neither the statute nor its legislative history contemplates that a

court should substitute its judgment for that of the agency as to the

environmental consequences of its actions. Kleppe v. Sierra Club, 427

U.S. at 410 n. 21.  We think the Court of Appeals has forgotten that

injunction here, and, accordingly, its judgment in this respect must

also be reversed.{22} [435 U.S. 556] B



Finally, we turn to the Court of Appeals' holding that the Licensing

Board should have returned the ACRS report to ACRS for further

elaboration, understandable to a layman, of the reference to other

problems.



The Court of Appeals reasoned that, since one function of the report was

"that all concerned may be apprised of the safety or possible hazard of

the facilities," the report must be in terms understandable to a layman

and replete with cross-references to previous reports in which the

"other problems" are detailed.  Not only that, but if the report does

not so elaborate, and the Licensing Board fails to sua sponte return the

report to ACRS for further development, the entire agency action, made

after exhaustive studies, reviews, and 14 days of hearings, must be

nullified.



Again the Court of Appeals has unjustifiably intruded into the

administrative process.  It is true that Congress thought publication of

the ACRS report served an important function.  But the legislative

history shows that the function of publication was subsidiary to its

main function, that of providing technical advice from a body of experts

uniquely qualified to provide assistance.  See 42 U.S.C.  2039; S.Rep.

No. 296, 85th Cong., 1st Sess., 24 (1957); Joint Committee on Atomic

Energy, A Study of AEC Procedures and Organization in the Licensing of

Reactor Facilities, 85th Cong., 1st Sess., 32-34 (Comm.Print 1957).  The

basic information to be conveyed to the public is not necessarily a full

technical exposition of every facet of nuclear energy, but rather the

ACRS's position, and reasons therefor, with respect to the safety of a

proposed nuclear reactor.  Accordingly, the ACRS cannot be faulted for

not dealing with every facet of nuclear energy in every report it

issues.



Of equal significance is the fact that the ACRS was not obfuscating its

findings.  The reports to which it referred were matters of public

record, on file in the Commission's [435 U.S. 557] public documents

room.  Indeed, all ACRS reports are on file there.  Furthermore, we are

informed that, shortly after the Licensing Board's initial decision,

ACRS prepared a list which identified its "generic safety concerns."  In

light of all this, it is simply inconceivable that a reviewing court

should find it necessary or permissible to order the Board to sua sponte

return the report to ACRS.  Our view is confirmed by the fact that the

putative reason for the remand was that the public did not understand

the report, and yet not one member of the supposedly uncomprehending

public even asked that the report be remanded.  This surely is, as

petitioner Consumers Power claims, "judicial intervention run riot."

Brief for Petitioner in No. 76-528, p. 37.



We also think it worth noting that we find absolutely nothing in the

relevant statutes to justify what the court did here.  The Commission

very well might be able to remand a report for further clarification,

but there is nothing to support a court's ordering the Commission to

take that step or to support a court's requiring the ACRS to give a

short explanation, understandable to a layman, of each generic safety

concern.



All this leads us to make one further observation of some relevance to

this case.  To say that the Court of Appeals' final reason for remanding

is insubstantial, at best, is a gross understatement.  Consumers Power

first applied in 1969 for a construction permit -- not even an operating

license, just a construction permit.  The proposed plant underwent an

incredibly extensive review.  The reports filed and reviewed literally

fill books.  The proceedings took years, and the actual hearings

themselves over two weeks.  To then nullify that effort seven years

later because one report refers to other problems, which problems

admittedly have been discussed at length in other reports available to

the public, borders on the Kafkaesque.  Nuclear energy may some day be a

cheap, safe source of power, or it may not.  But Congress has made a

[435 U.S. 558] choice to at least try nuclear energy, establishing a

reasonable review process in which courts are to play only a limited

role.  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 agency

action.  Time may prove wrong the decision to develop nuclear energy,

but it is Congress or the States, within their appropriate agencies,

which must eventually make that judgment.  In the meantime, courts

should perform their appointed function.  NEPA does set forth

significant substantive goals for the Nation, but its mandate to the

agencies is essentially procedural.  See 42 U.S.C.  4332.  See also

Aberdeen & Rockfish R. Co. v. SCRAP, 422 U.S. at 319.  It is to insure a

fully informed and well considered decision, not necessarily a decision

the judges of the Court of Appeals or of this Court would have reached

had they been members of the decisionmaking unit of the agency.

Administrative decisions should be set aside in this context, as in

every other, only for substantial procedural or substantive reasons as

mandated by statute, Consolo v. FMC, 383 U.S. 607, 620 (1966), not

simply because the court is unhappy with the result reached.  And a

single alleged oversight on a peripheral issue, urged by parties who

never fully cooperated or indeed raised the issue below, must not be

made the basis for overturning a decision properly made after an

otherwise exhaustive proceeding.



Reversed and remanded.



MR. JUSTICE BLACKMUN and MR. JUSTICE POWELL took no part in the

consideration or decision of these cases. Footnotes REHNQUIST, J., lead

opinion (Footnotes)



* Together with No. 76-528, Consumers Power Co. v. Aeschliman et al.,

also on certiorari to the same court.



1. While there was division in this Court in United States v. Florida

East Coast R. Co. with respect to the constitutionality of such an

interpretation in a case involving ratemaking, which Mr. Justice Douglas

and MR. JUSTICE STEWART felt was "adjudicatory" within the terms of the

Act, the cases in the Court of Appeals for the District of Columbia

Circuit which we review here involve rulemaking procedures in their most

pristine sense.



2. The licensing and regulatory functions of the Atomic Energy

Commission (AEC) were transferred to the Nuclear Regulatory Commission

(NRC) by the Energy Reorganization Act of 1974, 42 U.S.C.  5801 et seq.

(1970 ed., Supp. V).  Hereinafter, both the AEC and NRC will be referred

to as the Commission.



3. ACRS is required to review each construction permit application for

the purpose of informing the Commission of the "hazards of proposed or

existing reactor facilities and the adequacy of proposed reactor safety

standards."  42 U.S.C.  2039.



4. The Licensing Board issues a permit if it concludes that there is

reasonable assurance that the proposed plant can be constructed and

operated without undue risk, 42 U.S.C.  2241; 10 CFR  50.35(a) (1977),

and that the environmental cost-benefit balance favors the issuance of a

permit.



5. When a license application is contested, the Licensing Board must

find reasonable assurance that the plant can be operated without undue

risk and will not be inimical to the common defense and security or to

the health and safety of the public.  See 42 U.S.C.  2232(a); 10 CFR

50.57(a) (1977).  The Licensing Board's decision is subject to review

similar to that afforded the Board's decision with respect to a

construction permit.



6. The nuclear fission which takes place in light-water nuclear reactors

apparently converts its principal fuel, uranium, into plutonium, which

is itself highly radioactive but can be used as reactor fuel if

separated from the remaining uranium and radioactive waste products.

Fuel reprocessing refers to the process necessary to recapture usable

plutonium.  Waste disposal, at the present stage of technological

development, refers to the storage of the very long-lived and highly

radioactive waste products until they detoxify sufficiently that they no

longer present an environmental hazard.  There are presently no physical

or chemical steps which render this waste less toxic, other than simply

the passage of time.



7. The Commission stated:



In our view, the procedures adopted provide a more than adequate basis

for formulation of the rule we adopted.  All parties were fully heard.

Nothing offered was excluded.  The record does not indicate that any

evidentiary material would have been received under different

procedures.  Nor did the proponent of the strict "adjudicatory" approach

make an offer of proof -- or even remotely suggest -- what substantive

matters it would develop under different procedures.  In addition, we

note that 11 documents including the Survey were available to the

parties several weeks before the hearing, and the Regulatory staff,

though not requested to do so, made available various drafts and

handwritten notes.  Under all of the circumstances, we conclude that

adjudicatory type procedures were not warranted here. App. 389-390

(footnote omitted).



8. The ACRS report as quoted, 178 U.S.App.D.C. at 333, 547 F.2d at 630,

stated:



Other problems related to large water reactors have been identified by

the Regulatory Staff and the ACRS and cited in previous ACRS reports.

The Committee believes that resolution of these items should apply

equally to the Midland Plant Units 1 & 2.



The Committee believes that the above items can be resolved during

construction, and that, if due consideration is given to these items,

the nuclear units proposed for the Midland Plant can be constructed with

reasonable assurance that they can be operated without undue risk to the

health and safety of the public.



9. Saginaw included the Saginaw Valley Nuclear Study Group, the Citizens

Committee for Environmental Protection of Michigan, the United

Automobile Workers International, and three other environmental groups.

Mapleton included Nelson Aeschliman and five other residents of a

community near the proposed plant site.  Mapleton did not raise any

contentions relating to energy conservation.



10. Pursuant to the regulations then in effect, the Licensing Board

refused to consider most of the environmental issues in this first set

of hearings.  On the last day of those hearings, however, the Court of

Appeals for the District of Columbia Circuit decided Calvert Cliffs'

Coordinating Comm. v. AEC, 146 U.S.App.D.C. 33, 449 F.2d 1109 (1971),

which invalidated the Commission's NEPA regulations.  One effect of that

decision was to require that environmental matters be considered in

pending proceedings, including this one.  Accordingly, the Commission

revised its regulations and then undertook an extensive environmental

review of the proposed nuclear plants, requiring Consumers Power to file

a lengthy environmental report.  Thereafter, the Commission's staff

prepared the draft environmental impact statement discussed in text.



11. The Licensing Board had highlighted this same problem in its initial

decision, noting that the failure to propose proper findings and

conclusions has greatly complicated the task of the Board, and has made

it virtually impossible in some instances to know whether particular

issues are, in fact, contested. App. 190 n. 10.  The Appeal Board was

even less charitable, noting that that "[p]articipation in this manner,

in our opinion, subverts the entire adjudicatory process."  Id. at 257.



12. In what was essentially dictum, the Commission also ruled, after

considering the various relevant factors -- such as the extent to which

the new rule represents a departure from prior practice, the degree of

reliance on past practice, and consequent burdens imposed by retroactive

application of the rule -- that the rule enunciated in Niagara should

not be applied retroactively to cases which had progressed to final

order and issuance of construction permits before Niagara was decided.

App 337.



13. In the Court of Appeals, no one questioned the Commission's

authority to deal with fuel cycle issues by informal rulemaking, as

opposed to adjudication.  178 U.S.App.D.C. at 345-346, 547 F.2d at

642-643.  Neither does anyone seriously question before this Court the

Commission's authority in this respect.



14. After the decision of the Court of Appeals, the Commission

promulgated a new interim rule pending issuance of a final rule.  42

Fed.Reg. 13803 (1977).  See Vermont Yankee Nuclear Power Corp., 5 N.R.C.

717 (1977).  The Commission then, at the request of the New England

Coalition on Nuclear Pollution, applied the interim rule to Vermont

Yankee and determined that the cost-benefit analysis was still in the

plant's favor.  Vermont Yankee Nuclear Power Corp., 6 N.R.C. 25 (1977).

That decision is presently on appeal to the Court of Appeals for the

First Circuit.  The Commission has also indicated in its brief that it

intends to complete the proceedings currently in progress looking toward

the adoption of a final rule regardless of the outcome of this case.

Brief for Federal Respondents 37 n. 36.  Following oral argument,

respondent NRDC, relying on the above facts, filed a suggestion of

mootness and a motion to dismiss the writ of certiorari as improvidently

granted.  We hold that the case is not moot, and deny the motion to

dismiss the writ of certiorari as improvidently granted.



Upon remand, the majority of the panel of the Court of Appeals is

entirely free to agree or disagree with Judge Tamm's conclusion that the

rule pertaining to the back end of the fuel cycle under which petitioner

Vermont Yankee's license was considered is arbitrary and capricious

within the meaning of  10(e) of the Administrative Procedure Act, 5

U.S.C.  706 (1976 ed.), even though it may not hold, as it did in its

previous opinion, that the rule is invalid because of the inadequacy of

the agency procedures.  Should it hold the rule invalid, it appears in

all probability that the Commission will proceed to promulgate a rule

resulting from rulemaking proceedings currently in progress.  Brief for

Federal Respondents 37 n. 36.  In all likelihood, the Commission would

then be required, under the compulsion of the court's order, to examine

Vermont Yankee's license under that new rule.



If, on the other hand, a majority of the Court of Appeals should decide

that it was unwilling to hold the rule in question arbitrary and

capricious merely on the basis of  10(e) of the Administrative Procedure

Act, Vermont Yankee would not necessarily be required to have its

license reevaluated.  So far as petitioner Vermont Yankee is concerned,

there is certainly a case or controversy in this Court with respect to

whether it must, by virtue of the Court of Appeals' decision, submit its

license to the Commission for reevaluation and possible revocation under

a new rule.  It is true that we do not finally determine here the

validity of the rule upon which the validity of Vermont Yankee's

license, in turn, depends.  Neither should anything we say today be

taken as a limitation on the Court of Appeals' discretion to take due

account, if appropriate, of any additions made to the record by the

Commission or to consolidate this appeal with the appeal from the

interim rulemaking proceeding which is already pending.  But the fact

that the question of the validity of the first rule remains open upon

remand makes the controversy no less "live."



As we read the opinion of the Court of Appeals, its view that reviewing

courts may, in the absence of special circumstances, justifying such a

course of action impose additional procedural requirements on agency

action raises questions of such significance in this area of the law as

to warrant our granting certiorari and deciding the case.  Since the

vast majority of challenges to administrative agency action are brought

to the Court of Appeals for the District of Columbia Circuit, the

decision of that court in this case will serve as precedent for many

more proceedings for judicial review of agency actions than would the

decision of another Court of Appeals.  Finally, this decision will

continue to play a major role in the instant litigation regardless of

the Commission's decision to press ahead with further rulemaking

proceedings.  As we note in n. 15, infra, not only is the NRDC relying

on the decision of the Court of Appeals as a device to force the agency

to provide more procedures, but it is also challenging the interim rules

promulgated by the agency in the Court of Appeals, alleging again the

inadequacy of the procedures and citing the opinion of the Court of

Appeals as binding precedent to that effect.



15. Vermont Yankee's interpretation has been consistent throughout the

litigation.  That cannot be said of the other parties, however.  The

Government, Janus-like, initially took both positions.  While the

petition for certiorari was pending, a brief was filed on behalf of the

United States and the Commission, with the former indicating that it

believed the court had unanimously held the record to be inadequate,

while the latter took Vermont Yankee's view of the matter.  See Brief

for Federal Respondents 5-9 (filed Jan. 10, 1977).  When announcing its

intention to undertake licensing of reactors pending the promulgation of

an "interim" fuel cycle rule, however, the Commission said: [T]he court

found that the rule was inadequately supported by the record insofar as

it treated two particular aspects of the fuel cycle -- the impacts from

reprocessing of spent fuel and the impacts from radioactive waste

management. 41 Fed.Reg. 45850 (1976).  And even more recently, in

opening another rulemaking proceeding to replace the rule overturned by

the Court of Appeals, the Commission stated: The original procedures

proved adequate for the development and illumination of a wide range of

fuel cycle impact issues. . . .



. . .  The court here indicated that the procedures previously employed

could suffice, and indeed did for other issues. *    *    *    *



Accordingly, notice is hereby given that the rules for the conduct of

the reopened hearing and the authorities and responsibilities of the

Hearing Board will be the same as originally applied in this matter (38

Fed.Reg. 49, January 3, 1973) except that specific provision is hereby

made for the Hearing Board to entertain suggestions from participants as

to questions which the Board should ask of witnesses for other

participants. 42 Fed.Reg. 26988-26989 (1977).



Respondent NRDC likewise happily switches sides depending on the forum.

As indicated above, it argues here that the Court of Appeals held only

that the record was inadequate.  Almost immediately after the Court of

Appeals rendered its decision, however, NRDC filed a petition for

rulemaking with the Commission which listed over 13 pages of procedural

suggestions it thought "necessary to comply with the Court's order and

with the mandate of [NEPA]."  NRDC, Petition for Rulemaking, NRC Docket

No. RM-50-3 (Aug. 10, 1976).  These proposals include cross-examination,

discovery, and subpoena power.  Id.  Attachment, Rules for Conduct of

Hearing on Environmental Effects of the Uranium Fuel Cycle,  5(a), 9(b),

11.  NRDC likewise challenged the interim fuel cycle rule, and suggested

to the Court of Appeals that it hold the case pending our decision in

this case because the interim rules were "defective due to the

inadequacy of the procedures used in developing the rule. . . ."  Motion

to Hold Petition for Review in Abeyance 1, in NRDC v. NRC, No. 77-1448

(DC Cir., petition for review filed May 13, 1977; motion filed July 5,

1977).  NRDC has likewise challenged the procedures being used in the

final rulemaking proceeding as being "no more than a re-run of hearing

procedures which were found inadequate [by the Court of Appeals]."  NRDC

Petition for Reconsideration of the Ruling Reopening the Hearings on the

Environmental Effects of the Uranium Fuel Cycle 10, NRC Docket No.

RM-50-3 (June 6, 1977).



16. Respondent NRDC does not now argue that additional procedural

devices were required under the Constitution.  Since this was clearly a

rulemaking proceeding in its purest form, we see nothing to support such

a view.  See United States v. Florida East Coast R. Co., 410 U.S. 224,

(1973); Bowles v. Willingham, 321 U.S. 503 (1944); Bi-Metallic

Investment Co. v. State Board of Equalization, 239 U.S. 441 (1915).



17. NRDC argues that the agency has in the past provided more than the

minimum procedures specified in  4 of the APA, and therefore something

more is required here, since [a]gencies are not free to alter their

procedures on a whim, grossly constricting parties' procedural rights

when it deems them an impediment or embarrassment to implementing its

own views. Brief for Respondents in No. 76-419, p. 46.  In support, NRDC

first argues that the Commission has considered other equally generic

issues in adjudicatory proceedings.  But NRDC conceded in the court

below that the agency could promulgate rules regarding the fuel cycle in

rulemaking proceedings.  178 U.S.App.D.C. at 346, 547 F.2d at 643.

Moreover, even here it concedes that the Commission has in the past

chosen to consider both environmental and safety issues that would

ordinarily be addressed in adjudicatory licensing proceedings through

"generic" rulemaking, a practice with which the lower court did not take

issue. Brief for Respondents in No. 76-419, p. 48.  It now contends,

however, that the Commission provided more procedural safeguards in

those rulemaking proceedings than in the proceeding presently under

review.  In support, it cites three previous proceedings where

cross-examination was supposedly provided.  Id. at 49 n. 69.



Pretermitting both the fact that the Court of Appeals in no way relied

upon this argument in its decision and the question of whether courts

can impose additional procedures even when an agency substantially

departs from past practice, we find NRDC's argument without merit.  In

the first place, three proceedings out of the many held by NRC and its

predecessor hardly establish the type of longstanding and well

established practice deviation from which might justify judicial

intervention.  It appears, moreover, that, in fact, the hearings cited

by NRDC are not only not part of a longstanding practice, but are

themselves aberrational.  Since 1970, the Commission has conducted a

large number of rulemaking proceedings, some of which have involved

matters of substantial importance, and almost none of which have

involved cross-examination.  See, e.g., Quality Assurance Criteria for

Nuclear Power Plants, 35 Fed.Reg. 10499 (1970); General Design Criteria

for Nuclear Power Plants, 36 Fed.Reg. 3255 (1971); Pre-Construction

Permit Activities, 39 Fed.Reg. 14506 (1974); Environmental Protection --

Licensing and Regulatory Policy and Procedures.  Id. at 26279.



18. See, e.g., CAB v. Hermann, 353 U.S. 322 (1957); Oklahoma Press Pub.

Co. v. Walling, 327 U.S. 186 (1946); Wallace Corp. v. NLRB, 323 U.S. 248

(1944); Endicott Johnson Corp. v. Perkins, 317 U.S. 501 (1943); Utah

Fuel Co. v. National Bituminous Coal Comm'n, 306 U.S. 56 (1939);

Norwegian Nitrogen Products Co. v. United States, 288 U.S. 294 (1933).



19. See Power Reactor Co. v. Electricians, 367 U.S. 396, 408 (1961);

United States v. Zucca, 351 U.S. 91, 96 (1956)



20. See Wright, The Courts and the Rulemaking Process:  The Limits of

Judicial Review, 59 Cornell L.Rev. 375, 387-388 (1974).



21. Of course, the court must determine whether the agency complied with

the procedures mandated by the relevant statutes.  Citizens to Preserve

Overton Park v. Volpe, 401 U.S. 402, 417 (1971).  But, as we indicated

above, there is little doubt that the agency was in full compliance with

all the applicable requirements of the Administrative Procedure Act.



22. The court also indicated at the end of the opinion in Aeschliman

that, since this matter requires remand and reopening of the issues of

energy conservation alternatives as well as recalculation of costs and

benefits, we assume that the Commission will take into account the

changed circumstances regarding Dow's [the principal customer for the

plant's steam] need for process steam, and the intended continued

operation of Dow's fossil fuel generating facilities. 178 U.S.App.D.C.

at 335, 547 F.2d at 632.  As we read the Court of Appeals opinion,

however, this was not an independent basis for vacating and remanding

the Commission's licensing decision.  It also appears from the record

that the Commission has reconsidered the changed circumstances and

refused to reopen the proceedings at least three times, see App.

346-347, 348-349, 350-351, and possibly a fourth, see Brief for

Nonfederal Respondents in No. 76-528, pp. 19-20, n. 8.  We see no error

in the Commission's actions in this respect.

