Supreme Court Restores the Use of Cost-Benefit Analysis Under the Clean Water Act for Cooling Water Intake Structures

The U.S. Supreme Court on April 1, 2009 issued its decision in Entergy Corp. v. Riverkeeper, Inc. on the issue of whether Section 316(b) of the Clean Water Act (the Act) authorizes the Environmental Protection Agency (EPA) to compare costs with benefits in determining the “best technology available for minimizing adverse environmental impact” at cooling water intake structures. The Court found that EPA acted permissibly in using cost-benefit analysis in the regulations it promulgated to establish national performance standards, and in its allowing site-specific variances to those standards, under Section 316(b) of the Act as applied to existing power plants. The Court’s decision reverses an earlier decision by the U.S. Court of Appeals for the Second Circuit that significantly limited the ability of EPA to consider the costs of control technology in making decisions under Section 316(b). The Court’s decision is significant for existing power plants seeking to renew permits issued under the Act for their cooling water intake structures, as well as more broadly for the use of cost-benefit analysis in establishing environmental standards.

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