President Reagan's new plan to stimulate growth in the nuclear power industry encountered a surprise roadblock yesterday in a federal appeals court ruling that a state has an "inherent" power to prevent construction of nuclear plants "inconsistent" with its need for power or with its environmental or other interests.
Administration energy experts indicated that the president was unaware of the decision, released in San Francisco late Wednesday, when he announced his program the next day.
The U.S. Atomic Energy Act of 1954 "does not preempt state laws enacted for purposes other than protection against radiation hazards," Judge Betty B. Fletcher wrote for a unanimous three-judge panel of the 9th U.S. Circuit Court of Appeals.
The decision, a defeat for the nuclear and utility industries, rejected contentions by two California utilities that the law gives the Nuclear Regulatory Commission sole authority to regulate "for all purposes" the construction and operation of nuclear plants.
"The states are permitted to treat nuclear plants exactly as they would all other power plants," Fletcher wrote.
In addition, the opinion said, the 1977 amendments to the Clean Air Act "give states the authority to regulate radioactive air emissions from nuclear plants. States may, if they wish, establish emission standards more stringent than those imposed by the NRC."
While Reagan was saying he would press for swift installation of permanent facilities for disposal of commercial radioactive wastes, the court was recognizing the muchdisputed right of a states to block new nuclear power plants until it considers the disposal problem to be solved.
Referring to NRC positions in other cases, the court said agency has agreed that the amendments empower a state to "prevent nuclear plants from being built at all." The NRC, for unexplained reasons, was not a party to the case and had no immediate comment.
The decision's deference to state authority "may represent a serious obstacle, not to Congress's plan, but to the Reagan Administration's plan," according to Harvard law Prof. Laurence H. Tribe, who was lead appellate counsel for the victorious California state energy commission.
The decision is almost certain to be appealed to the Supreme Court, which may routinely ask the Justice Department for its views.This could create a dilemma for an administration that advocates states' rights while its Department of Energy holds to the position rejected by the appeals court -- that the Atomic Energy Act preempts state regulatory powers.
"If the administrtion really means to advocate nuclear development and commercial use independent of state preferences and concerns, then its two positions are at war with each other," Tribe said.
The DOE had no immediate comment. Neither did the Atomic Industrial Forum, an international industry association based in Bethesda, which had filed a pro-utility friend-of-the-court brief.
The case directly involves California's state energy regulatory scheme, probably the nation's most sweeping and comprehensive. In separate cases, two federal trial judges agreed with two utilities and the nonprofit, business-oriented Pacific Legal Foundation that the legislation improperly impeded construction of nuclear plants.
After two state attorneys general refused to defend the legislation, Gov. Edmund G. (jerry) Brown Jr. sided with the state energy commission, which enlisted Tribe for the successful appeal to the 9th Circuit.
Supporting California with friend-of-the-court briefs were 23 states, including Maryland, West Virginia, Pennsylvania, New York and Massachusetts.