UNITED STATES COURT OF APPEALS FOR THE D.C. CIRCUIT


NIAGARA MOHAWK POWER

v.

DOE


96-5082a

D.C. Cir. 1999


*	*	*


Williams, Circuit Judge: A cogeneration plant produces  not only
electric power but also steam or other thermal  energy that can be
used for various industrial or commercial  purposes. 16 U.S.C. s 796.
To encourage this source of  energy, the Public Utilities Regulatory
Policies Act of 1978,  16 U.S.C. s 824a-3 ("PURPA"), imposed a
requirement on  electric power utilities to purchase power from any
qualifying  facility ("QF")--a cogeneration plant that meets PURPA's 
QF standards. See 18 CFR ss 292.101(b)(1), 292.203(b).  The utility
must pay for the power at a rate no greater than  its "avoided
cost"--the cost it would incur to generate an  equivalent amount of
power itself. See 16 U.S.C.  s 824a-3(b); 18 CFR ss 292.304(a),
292.101(b)(6). Although  the phrase "avoided cost" has the ring of an
economically  sound price, it was suggested without contradiction at
oral  argument that it has not so proved.


Niagara, a producer and seller of electricity in upstate New  York and
subject to the PURPA mandate, suspected that  some of the facilities
from which it buys may not actually  qualify for QF status, and to
pursue the matter filed a  request with the Department of Energy
("DOE") in 1995  under the Freedom of Information Act ("FOIA"),
seeking  information collected by DOE on forms that these facilities 
are required to file with DOE's Energy Information Adminis-
tration--Forms EIA-867. DOE disclosed some but withheld  other
information, invoking FOIA's Exemption 4, 5 U.S.C.  s 552(b)(4), which
covers "trade secrets and commercial or 


financial information obtained from a person and privileged or 
confidential." The information withheld relates particularly  to
quantities of fuel consumed and power generated, from  which, given
market prices for fuel, outsiders could go far to  calculating a
facility's unit cost of power.


Niagara sued in district court to compel release of the  withheld data.
Independent Power Producers of New York,  Inc., a trade group, and
Sithe Energy Inc. ("QF Intervenors"  collectively) intervened in
support of DOE. Both DOE and  the QF Intervenors moved for summary
judgment, support- ing the motion with affidavits describing the QF
industry.  Niagara moved for discovery, and on the district court's 
denial of its motion filed an opposition to the motion for  summary
judgment, attaching an affidavit depicting the in- dustry in rather
different terms. The district court granted  summary judgment. It held
that Niagara had failed to raise  an issue of material fact against
DOE's position that the  information was exempt because its release
(1) would cause  substantial competitive harm to the entities
submitting the  information (the QFs), and (2) would impair the
agency's  ability to collect this information in the future. The court
 also rejected Niagara's claim that no FOIA exemption could  apply
because the information was already publicly available.


* * *


The language of Exemption 4 protects from disclosure  "commercial
information" obtained from a non-government  source, so long as it is
"privileged or confidential." The only  dispute here is over the last
phrase. In National Parks &  Conservation Ass'n v. Morton, 498 F.2d
765, 770 (D.C. Cir.  1974) ("National Parks I"), this court adopted a
narrow  reading of the word "confidential," saying that information 
was confidential within the meaning of Exemption 4 only if its 
disclosure was likely to (1) impair the government's ability to 
obtain necessary information in the future, or (2) cause  substantial
harm to the competitive position of the person  from whom the
information was obtained. The district court  found here that DOE had
satisfied both alternatives.


In support of its claim that release would impair govern- ment
interests, DOE offered two conclusory affidavits, claim- ing that
disclosure would impair the EIA's ability to collect  such information
in the future. See Walton Decl.pp 39-43;  Grutsch Decl., p 10. The
claim is inherently weak where, as  here, the agency has secured the
information under compul- sion. Critical Mass Energy Project v. NRC,
975 F.2d 871,  878 (D.C. Cir. 1992) (en banc). Yet DOE and the QF 
Intervenors offer nothing but Walton's speculative opinion  that QFs
may not be forthcoming in the data they submit if  DOE allows
disclosure, see Walton Decl., p 41, and Grutsch's  terse and
self-serving statement that as an executive of  various QFs he would
"attempt to minimize the scope and  specificity of the information
provided." See Grutsch Decl.,  p 10. But the agency has the burden of
showing that re- questing information comes within a FOIA exemption,
Na- tional Parks & Conservation Ass'n v. Kleppe, 547 F.2d 673,  679
(D.C. Cir. 1976) ("National Parks II"), and we have more  than once
held that such conclusory and generalized asser- tions are not enough
to establish the requisite risk of impair- ment. Id. at 680;
Washington Post Co. v. Dep't of Health  and Human Serv., 690 F.2d 252,


DOE insists that summary judgment is proper because  Niagara did not
controvert the assertions of impairment.  But on a summary judgment
motion, "[f]acts not conclusively  demonstrated, but essential to the
movant's claim, are not  established merely by his opponent's silence;
rather, the  movant must shoulder the burden of showing affirmatively 
the absence of any meaningful factual issue." See National  Assoc. Of
Gov't Employees v. Campbell, 593 F.2d 1023, 1027  (D.C. Cir. 1978). A
paper asserting the affiant's intention to  sail as close to the wind
as possible is hardly enough for this  case--especially as the data
sought appears to take the form  of hard, cold numbers on energy use
and production, the  fudging of which may strain all but the
deliberately menda- cious. As the DOE and QF Intervenor affidavits are
in these  circumstances too vague, the grant of summary judgment on 
this issue was unjustified.


DOE fares no better in its effort to show that there is no  genuine
issue of material fact on the likelihood of substantial  competitive
harm. In National Parks II, we held that for the  government to
preclude disclosure based on a competitive  injury claim, it must
prove that the submitters "(1) actually  face competition, and (2)
substantial competitive injury would  likely result from disclosure."
547 F.2d. at 679. Here,  DOE's assertions of the existence of
competition are some- what conclusory. See Walton Decl. WW 22-31. But
assuming  arguendo that DOE met its initial burden of proving that QFs
 were engaged in competition, Niagara's response was ade- quate to
raise genuine issues of material fact. The affidavit  submitted by
Niagara, from James Cifaratta, its Director of  Unregulated
Generation, flatly disputes the assertions of  competition. For
example, so far as competition by QFs in  the sale of power is
concerned, Cifaratta asserts that arrange- ments under which QFs sell
electricity in an unregulated  market (i.e., outside the shelter of
the PURPA mandate) are  uncommon and "truly exceptional." See
Cifaratta Decl.  pp 11-12. He further says that the long term
contracts that  QFs have with their steam hosts--buyers of the thermal
 energy produced by cogeneration--preclude competition  among the QFs
for such hosts. Id. p 13. This theoretically  leaves competition among
the QFs as contracts expire. But  our decision in National Parks II,
that the district court was  clearly erroneous in finding that certain
concessionaires faced  substantial competitive harms in contract
renewal when the  contracts were for long periods and thus renewal
competition  would only occur infrequently, 547 F.2d at 681-82,
suggests  that a competitive injury is too remote for purposes of 
Exemption 4 if it can occur only in the occasional renegotia- tion of
long-term contracts. Niagara's response thus puts in  dispute whether
there is a likelihood of substantial competi- tion among QFs in


Further, though implicitly accepting DOE's and the QF  Intervenors'
assumption that QFs' competition with their  steam hosts for the
division of rents (quite apart from the  long terms of the contracts)
qualifies as "competition" for 


purposes of National Parks, Niagara contests the claim that  they
actually do so. See Cifaratta Decl. p 14. ("[T]he ar- rangements
between QFs and their steam hosts typically are  not determined by
ordinary market-based concerns ... QFs  often provide steam to their
hosts at very low rates, some- times for free. Some QFs, in fact,
subsidize their steam hosts  in order to secure PURPA and PSL s 66-c
benefits for  themselves."). While this struggle-free relation may
seem  unlikely, the contention directly contradicts the assertions on 
which the district court relied.


DOE's other arguments relating to competitive injury are  legally
inadequate under the National Parks standard. For  example, DOE argues
that the QFs may face future or  potential competition. But the test
explicitly requires proof  that the submitters face actual
competition. National Parks  II, 547 F.2d at 679. DOE also insinuates
that Niagara's  interest in challenging the regulatory entitlement of
QFs  shows a competitive relationship between the QFs and Niaga- ra.
The argument would make sense only if a producer's  regulatory
entitlement to governmentally administered prices  could be said to
put the producer in "competition" with the  involuntary purchaser. But
if National Parks I embraced  any such expansive idea of competition,
the case would have  come out differently. There the court recognized
that the  private sources of the disputed data, park concessionaires, 
enjoyed monopoly contracts with the Park Service, contracts  that by
statute were to be renewed so long as the concession- aires performed
satisfactorily. 498 F.2d at 770 n.20. The  data sought to be collected
bore on that performance. If the  court thought that a firm's interest
in protecting such an  entitlement from the outsider scrutiny
qualified as a competi- tive interest, it would have affirmed the
district court's appli- cation of Exemption 4.


As each legally sound theory offered by DOE is plagued by  factual
disputes, summary judgment was improper. On re- mand the district
court will want to consider the Supreme  Court's observation that
"categorical decisions may be appro- priate and individual
circumstances disregarded when a case  fits into a genus in which the
balance characteristically tips in 


one direction," Dep't of Justice v. Reporters Committee for  Freedom
of the Press, 489 U.S. 749, 776 (1989); see also  Critical Mass, 975
F.2d at 879. Thus, a finding that QFs as a  class generally do or do
not have competitive interests that  would be injured by release of
the information on Form EIA- 867 Form may be suitable.


Niagara also claimed that Form EIA-867 information is  already in the
public domain--a proposition that if true would  give victory to
Niagara independent of the matters discussed  above. Niagara's
position here is a little odd: if the informa- tion is publicly
available, one wonders, why is it burning up  counsel fees to obtain
it under FOIA? But the logic of FOIA  compels the result: if identical
information is truly public,  then enforcement of an exemption cannot
fulfill its purposes.  See Davis v. Dep't of Justice, 968 F.2d 1276,
1279 (D.C. Cir.  1992) (Exemptions 7(C) & 7(D)); CNA Financial Corp.
v.  Donovan, 830 F.2d 1132, 1154 (D.C. Cir. 1987) (Exemption 4); 
Afshar v. Dep't of State, 702 F.2d 1125 (D.C. Cir. 1983)  (Exemptions
1 & 3). On this issue the party favoring disclo- sure has the burden
of production, for otherwise the party  opposing disclosure would
theoretically have to identify all  public sources not reproducing the
information. Id. at 1130.  Niagara has sought to meet the burden with
the argument  that the data on Form EIA-867 is substantially
equivalent to  the data the QFs are required to file on Form 556 in
their  applications to the Federal Energy Regulatory Commission  for
QF certification, which is publicly available.


Before this court, both DOE and the QF Intervenors claim  that the
information on Form EIA-867 is narrower in scope  than that submitted
on Form 556. But that claim is at odds  with their position before the
district court. At argument on  the summary judgment motion, counsel
for the QF Interve- nors conceded that the information provided by QFs
upon  initial certification was "substantially identical to that found
 in form 867 and that information is public." And DOE  counsel
supported this observation with equally emphatic  language: "[The
information] may be absolutely totally iden- tical, but it's
projected. It's not actual, and that's the big  difference." Although
obviously there is a world of difference 


between projected and actual data, these positions either  assert or
assume that the information on the two forms is  identical in scope.


The district court accepted DOE's argument that while the 
certification information on Form 556 was only projected, the 
operational and performance information on Form EIA-867  was drawn
from actual experience. Niagara did not dispute  this, but countered
by arguing that FERC regulations re- quire QFs to make corrective
filings once there are material  changes in a QF's operations. See 18
U.S.C. s 292.207(d)(1).  But as the district court observed, such new
information is  required only when there are material changes in facts
and  representations included in the initial self-certification
filing.  Since these corrective filings are not necessarily made on an
 ongoing and continuous basis, Niagara seems to have initially  failed


But that is not the end of the story. After the district  court's
holding in this case, the New York Public Service  Commission rendered
a decision authorizing electric utilities  in New York to monitor the
compliance standards set out in  PURPA. See Re Motion to Establish
Programs for Moni- toring Qualifying Facility Status, Nos. 96-E-0775, 
95-E-0264, 1997 WL 114364 at *1 (N.Y.P.S.C. Jan. 9, 1997).  It is
undisputed that this decision requires New York QFs to  provide actual
current performance data of the sort required  for Form 556. Niagara
claims that this requirement puts the  requested information squarely
in the public domain.


In response to the specific question why in light of this  availability
Niagara is still trying to obtain the Form  EIA-867 information,
Niagara responds that the Public Ser- vice Commission decision
required information only from 1994  onwards, and that it wants to
relieve itself (and in the end  presumably its customers) from the
costs of erroneous  PURPA applications from earlier years. In fact,
the time  disparity is worse than that argument suggests, because the 
Federal Energy Regulatory Commission, though rejecting a  claim by New
York independent power producers that the 


New York decision was preempted by PURPA, denied it any  effect as to
data before the New York independents were on  notice of the
requirement,1 on the ground that such a man- date would impose an
undue burden on the producers. See  Independent Power Producers of New
York, Inc., 80 FERC  p 61,125 at 61,399 (1997).


Before us DOE and the QF Intervenors try to undercut the  relevance of
the New York decision by arguing that the scope  of information on
Form EIA-867 is materially broader than  that on Form 556. But that
was the scope claim that they  effectively disavowed in district
court; to allow them to raise  it now for the first time on appeal
would be grossly unfair to  Niagara.


But Niagara is still by no means home free on this issue.  For the
period of most concern to Niagara, i.e., before the  effective date of
the Public Service Commission decision as  modified by FERC, the New
York mandate obviously fails to  put the data into the public domain.
But even as to those  earlier data Niagara may have an argument on
remand.2  Even if the district court finds that the QFs are in
competi- tion that could be adversely affected by disclosure of the 
earlier data if it alone were disclosed, those data may turn out  to
add so little to what is covered by the New York decision  that its
public disclosure will cause no additional competitive  harm.




__________

n 1 It is uncertain from FERC's decision, Independent Power  Producers
of New York, Inc., 80 FERC p 61,125 at 61,399 (1997),  whether it
regarded the QFs as being on notice from August 30,  1996, when the
New York Commission made its initial declaratory  ruling and order
instituting the QF monitoring program, or from  January 13, 1995, when
FERC issued order No. 575, 60 Fed. Reg.  4831 (1995), which
established FERC Form 556 and its data re- quirements, which were in
turn picked up by the New York Public  Service Commission.


2 Since the New York decision issued after the judgment in this  case,
the district court never had an opportunity to consider it in 
evaluating Niagara's claims. Now it will.


* * *


The district court's order granting DOE's motion for sum- mary judgment
is vacated and remanded.


So ordered.