ML15014A509

14-1213 (D.C.Cir.) Respondents' Reply (Filed)

ML15014A509
Person / Time
Site:	Diablo Canyon
Issue date:	01/08/2015
From:	Andrew Averbach, Cruden J, Hansen-Young T, Mullins C Friends of the Earth, NRC/OGC, Pacific Gas & Electric Co, US Dept of Justice, Environment & Natural Resources Div
To:	Atomic Safety and Licensing Board Panel, US Federal Judiciary, US Court of Appeals for the District of Columbia Circuit
Creedon, Meghan
References
14-1213, 1531045
Download: ML15014A509 (13)

Text

USCA Case #14-1213 Document #1531045 Filed: 01/08/2015 Page 1 of 13 ORAL ARGUMENT NOT YET SCHEDULED IN THE UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT FRIENDS OF THE EARTH, )

)

Petitioner, )

v. ) No. 14-1213

)

U.S. NUCLEAR REGULATORY COMMISSION )

and the UNITED STATES OF AMERICA, )

)

Respondents, and )

)

PACIFIC GAS & ELECTRIC COMPANY, )

)

Intervenor. )

______________________________________________)

RESPONDENTS REPLY TO PETITIONERS RESPONSE TO RESPONDENTS MOTION TO DISMISS JOHN C. CRUDEN ANDREW P. AVERBACH Assistant Attorney General Solicitor THEKLA HANSEN-YOUNG CHARLES E. MULLINS Attorney Senior Attorney Appellate Section Office of the General Counsel Environment and Natural U.S. Nuclear Regulatory Commission Resources Division 11555 Rockville Pike U.S. Department of Justice Rockville, Maryland 2085 PO Box 7415, Ben Franklin Station (301) 415-1618 Washington, D.C. 20044 charles.mullins@nrc.gov (202) 307-2710 thekla.hansen-young@usdoj.gov January 8, 2014

USCA Case #14-1213 Document #1531045 Filed: 01/08/2015 Page 2 of 13 INTRODUCTION Petitioner Friends of the Earth (FOE) and Intervenor Pacific Gas & Electric Company (PG&E) have now responded to the Motion to Dismiss filed by Respondents United States of America and the U.S. Nuclear Regulatory Commission.1 Respondents established in their motion that (1) this Court lacks jurisdiction over the Petition for Review because the Petition does not challenge final agency action, and (2) the case is not ripe for review because FOE has filed identical claims now pending before the Commission. As set forth below, the responses confirm each of our arguments. Thus, this Court should dismiss the Petition for Review and allow the Commission to decide the issues that FOE has raised. FOE may file a new petition for review pursuant to the Hobbs Act if it is dissatisfied with the Commissions decision.

FACTUAL BACKGROUND As noted in our Motion to Dismiss, PG&E built the Diablo Canyon Nuclear Power Plant in an area that was later discovered to contain several earthquake faults. Motion to Dismiss at 5-7. In the 1970s, PG&E analyzed the Hosgri Fault, which had been discovered just offshore from the facility, and the maximum ground motion for a hypothetical earthquake on the Hosgri Fault was explicitly considered and applied in the licensing of the facility. Id. at 5-6. In 2008, PG&E 1

This Reply uses NRC to refer to the agency as a whole and Commission to refer to the 5-member body that manages the agency.

USCA Case #14-1213 Document #1531045 Filed: 01/08/2015 Page 3 of 13 discovered the Shoreline Fault, also lying near the facility. PG&E analyzed the Shoreline Fault and concluded that an earthquake on the fault would not impact safe operation of the plant. Id. at 6-7. PG&E has now filed Revision 21 to the Final Safety Analysis Report (Safety Report) for the plant stating that the ground motion resulting from the more recently-discovered Shoreline Fault is bounded by any ground motion resulting from the previously-analyzed Hosgri Fault. Id. at 8-9.

FOE asserts that the NRCs approval of Revision 21 has amended the Diablo Canyon licenses and that the amendments required a hearing in accordance with the Atomic Energy Act. Briefly, FOE argues before both this Court and the Commission that the Hosgri Fault was not incorporated into the plants seismic design bases and, therefore, cannot be used as a bounding condition without an amendment to the facilitys license. Compare FOE Response at 3-4 with Exhibit 1, Motion to Dismiss, at 18-27 and Exhibit 2, Motion to Dismiss, at 8-9.

ARGUMENT I. The NRC Memo of June 23, 2014 Is Not Final Agency Action.

1. FOE claims the NRC internal memo dated June 23, 2014, see Exhibit 3 to Respondents Motion to Dismiss, constitutes final agency action. FOE Response at 10-12. But the June 23 memo does not address the bounding issue raised by FOE, and NRC regulations do not require NRC approval of statements made in Revisions to a Safety Report. Instead, the memo merely reflects the internal NRC 2

USCA Case #14-1213 Document #1531045 Filed: 01/08/2015 Page 4 of 13 staff determination that Revision 21 addressed the actions that it was expected to address and was filed in a timely fashion. The memo makes no statement whether PG&E correctly incorporated the additional seismic analysis. See Motion to Dismiss at 14-15 and Exhibit 3. Thus, it is not the consummation of the agencys decisionmaking process, and no rights or obligations have been determined. Bennett v. Spear, 520 U.S. 154, 177-78 (1997) (citations omitted).

2. Even if the June 23 memo represented final agency action, as FOE claims (FOE Response at 8-12), we have demonstrated that FOE has appealed that action to the Commission and that this appeal renders the action non-final. See Motion to Dismiss at 15-16. FOE never addresses this argument in its Response.

FOE has challenged what it characterizes as the NRCs acceptance or approval of Revision 21, i.e., the action allegedly reflected in the June 23 memo, in its filings before the Commission. See Exhibit 3, Motion to Dismiss, at 12-19.

While the June 23 memo was not made public before FOEs filings with both the Commission and this Court (see FOE Response at 12), FOE has challenged the alleged decision it claims is reflected in that document in both fora. To the extent the June 23 memo constitutes an approval of Revision 21 by the NRC Staff, the Commission has the power to reverse that decision, and instead to require PG&E to seek a license amendment in order to incorporate the seismic information in Revision 21 into its Safety Report. Thus, even if the June 23 memo reflected final 3

USCA Case #14-1213 Document #1531045 Filed: 01/08/2015 Page 5 of 13 agency action when written, FOEs hearing request constitutes an appeal of that action that destroys any finality it may have originally possessed. Bellsouth Corp.

v. FCC, 17 F.3d 1487, 1489 (D.C. Cir. 1994).

II. FOEs Claim Is Not Ripe for Judicial Review.

We demonstrated in our motion that FOE has filed a request before the Commission raising the same issues raised in this lawsuit. See Motion to Dismiss at 17-20. In response, FOE claims the proceeding before the agency is somehow different from the proceeding before this Court. E.g., FOE Response at 4-7; 12-

13. But FOE ignores the fact that its claims before the Commission and this Court are materially identical. Moreover, FOEs Response makes additional claims identical to its claims pending before the Commission.

A. FOE Raises the Same Claims Before the Commission and this Court.

1. FOE never responds to our recitation of the identical claims made in both the Petition for Review and in its Reply filing with the agency. See, e.g., Motion to Dismiss at 15-16, 17-19. FOE claims before both this Court and the Commission that the agency has amended the Diablo Canyon licenses without the hearing required by the Atomic Energy Act. And in both proceedings FOE challenges the approval of Revision 21 to the Diablo Canyon Safety Report, which it claims was the NRC action amending the Diablo Canyon licenses. Yet FOEs Response never explains how these identical claims are somehow different.

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USCA Case #14-1213 Document #1531045 Filed: 01/08/2015 Page 6 of 13

2. In a revisionist effort to distinguish the two proceedings, FOE claims that the litigation before the Commission constitutes a separate proceeding that was initiated by the NRC when the agency requested licensees to review their current earthquake analyses as part of the NRCs Fukushima earthquake study. FOE Response at 5 & n. 3 (citing NRC Request for Information, dated March 12, 2012 (ML12053A340)).2 But that argument approaches the frivolous. In order to have initiated a proceeding with the March 12, 2012 letter, the NRC would have had to issue a Federal Register notice announcing the opportunity for a hearing and provide notice in the March 12 letter. See generally 10 C.F.R. § 2.309(b). But the NRC did not issue any such notice, and the letter itself does not mention any hearing opportunity. Thus, the March 12 letter did not initiate the proceeding.

That the March 12 letter did not initiate the Commission proceeding is further supported by the fact that FOE did not claim the March 12 letter as a basis for its hearing request before the Commission. Instead, FOEs only reference to the March 12 letter before the Commission is its assertion that the letter provides no authority for PG&E to submit the additional seismic information. See Exhibit 1, Motion to Dismiss, at 20-21; Exhibit 2, Motion to Dismiss, at 11. Thus, FOE can hardly claim now that the March 12, 2012 letter is the basis for the proceeding 2

ML citations reflect the accession number for documents that are available in ADAMS, the NRCs public database, www.nrc.gov/reading-rm/adams/html .

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USCA Case #14-1213 Document #1531045 Filed: 01/08/2015 Page 7 of 13 before the Commission. Instead, FOEs hearing request explains that the basis for its filing is that the NRC has violated § 189a(1)(A) of the Atomic Energy Act [42 U.S.C. § 2239(a)(1)(A)] with respect to [] Revision 21. Exhibit 3, Motion to Dismiss, at 5. And that is exactly what FOE claims to be the issue before this Court. See Petition for Review at 1-3.

Similarly, FOE mischaracterizes its hearing request as a petition to intervene in an ongoing licensing proceeding to determine the appropriate method of analysis for new seismic information. FOE Response at 12 (emphasis in original). But there was no ongoing proceeding claiming a de facto license amendment before FOE filed its hearing request. That proceeding simply did not exist before it was initiated by FOEs filing.

3. As part of its effort to distinguish its Petition for Review from the hearing request pending before the Commission, FOE elaborates on the arguments it intends to raise before this Court. For example, FOE argues that Revision 21 changed the Safe Shutdown Earthquake and established a less conservative analysis used for that earthquake as the benchmark against which all plant equipment must be certified. Response at 4. FOE argues that Revision 21 changed the Safe Shutdown Earthquake from one that could produce no more than 0.4 g at the plant to one that could produce up to 0.75 g at the plant, while requiring no changes to the plant itself to maintain the safety margin. This erosion of safety margin enlarges the licensees operating authority.

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USCA Case #14-1213 Document #1531045 Filed: 01/08/2015 Page 8 of 13 Id. at 5 (emphasis omitted).

But FOE makes the identical argument before the Commission. FOE filed two contentions (comparable to a count in a civil action) in its NRC hearing request. FOEs Contention 2 claims that NRC Staffs determination that the new seismic information, including the Shoreline Earthquake . . . is a lesser-included case within the Hosgri Earthquake is insufficient to insure that Diablo Canyon is operating safely with an adequate margin of safety.

Exhibit 1, Motion to Dismiss, at 47. In support, FOE argues that the postulated Safe Shutdown Earthquake has a much lower ground acceleration than the postulated Hosgri Earthquake - 0.4 g compared to 0.75 g respectively id. at 50, ¶ 8, and that [w]ithout a license amendment, a comparison of the new seismic data to the Hosgri Fault cannot be used to comply with the regulatory duty to insure that

[the safety-related equipment at Diablo Canyon] can withstand the maximum vibratory ground motion that can occur at the plant, id. at 51, ¶ 11.

In short, FOE has raised highly complex claims regarding the Diablo Canyon licensing history and the application of complex engineering principles regarding earthquake analyses to the safety of nuclear power plants. These issues are clearly within the primary jurisdiction of the agency designated by Congress to resolve such claims: the U.S. Nuclear Regulatory Commission.

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USCA Case #14-1213 Document #1531045 Filed: 01/08/2015 Page 9 of 13 B. FOE Must Exhaust Its Administrative Remedies.

FOE claims that it is not required to exhaust its available remedies before the Commission, arguing that Darby v. Cisneros, 509 U.S. 137 (1993), mandates that exhaustion must be required by statute or agency regulation and that neither exists here. FOE Response at 13-15. FOE also anticipates that the NRC will argue that it must seek relief in the form of a petition filed under 10 C.F.R. § 2.206 (a

§ 2.206 Petition)3 before filing a petition for review, FOE Response at 15, and that that such a requirement is improper in this case. FOE Response at 15-18. But these arguments rest on inaccurate factual premises.

1. FOE misapplies Darby v. Cisneros to this situation. We are not arguing here that FOE must take an additional action before bringing suit. But having elected to file a hearing request with the Commission that includes the exact issue in the Petition for Review before this Court, FOE must exhaust the remedy it has elected before seeking judicial intervention. Regardless of whether framed as finality, exhaustion, or election of remedies, a party should not be permitted to file a hearing request with the Commission and then file a lawsuit that raises the same claim before this Court without waiting for the Commission to rule on its request.

3 10 C.F.R. § 2.206 provides that [a]ny person may file a request to institute a proceeding . . . to modify, suspend, or revoke a license, or for any other action as may be proper. The NRC may take any number of actions in response to a

§ 2.206 Petition, including enforcement action or instituting a hearing pursuant to Section 189a of the Atomic Energy Act.

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USCA Case #14-1213 Document #1531045 Filed: 01/08/2015 Page 10 of 13 Here, FOE has filed a hearing request with the Commission, arguing that the NRCs approval of Revision 21 constitutes a de facto license amendment of the Diablo Canyon licenses. See Motion to Dismiss, Exhibit 2 at 3-4, 9, 12-19. FOE argues that the new seismic information in Revision 21 constitutes a change in the plants licensing basis and requires a hearing. Id. Thus, contrary to FOEs claim (Response at 6), a Commission decision granting its hearing request will provide exactly the same relief that FOE seeks in its Petition for Review - a hearing on whether PG&E correctly incorporated the new seismic information into its Safety Report. A case is not ripe for review when a pending agency proceeding may render the case moot. In re Aiken County, 645 F.3d 428, 435 (D.C. Cir. 2011).

And that is precisely the case given FOEs claim pending before the Commission.

2. Contrary to FOEs anticipated argument (FOE Repose at 15), we do not assert that FOE must file a § 2.206 Petition to exhaust its hearing claim. 4 Instead, we argue that because FOE has filed a hearing request with the Commission raising the identical issue it has raised before this Court, it must wait for the Commission to rule on that request before seeking relief from this Court.

4 Because we do not claim that FOE must file a § 2.206 Petition to exhaust its remedies, FOEs argument that exhaustion is futile, see FOE Response at 16-18, is irrelevant. And even assuming arguendo that the internal NRC decision FOE cites as an indication of bias precludes the NRC Staff from fairly reviewing a § 2.206 Petition, that Staff decision in no way binds the Commission - the ultimate authority in the agency - from deciding the entirely separate hearing request now pending before it.

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USCA Case #14-1213 Document #1531045 Filed: 01/08/2015 Page 11 of 13

3. FOE makes a merits argument that it is not required to file a § 2.206 Petition in this situation. FOE Response at 15-18. P&E asserts that FOE is required to exhaust its remedies by filing a § 2.206 Petition. See PG&E Response at 16-19. But Respondents do not take any position on these merits arguments because they are pending before the Commission, which is the proper body to resolve them. Compare Exhibit 1, PG&E Response, at 22-23, 26, with Exhibit 2, Motion to Dismiss, at 24-26. That disagreement goes directly to the question of how the Commission orders its internal procedures and processes, and the agency should be allowed to rule on the issue in the first instance. Thus, the presence of this argument before the Commission is an additional reason for this Court to dismiss this Petition for Review and allow the Commission to decide the issue.5 CONCLUSION For the foregoing reasons, and the reasons stated in our Motion to Dismiss, this Court should dismiss the Petition for Review.

5 FOE claims that [d]espite repeated requests . . . NRC has failed or refused to provide [FOE] with access to documents identified in the Certified Index, including Revision 21, the approval of which is the very basis of this Petition.

Response at 8. But FOE had access to that portion of Revision 21 that addressed the seismic issues in this case when filing its pleadings before the Commission and also advised the undersigned that that access would be sufficient for this Motion.

Security reviews of several documents are ongoing and will be completed promptly and, in any event, before any briefing of this case on the merits. In any event, those documents are relevant to the merits issues, not to the procedural dispute at issue in this Motion.

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USCA Case #14-1213 Document #1531045 Filed: 01/08/2015 Page 12 of 13 Respectfully submitted,

__s/Andrew P. Averbach___

JOHN C. CRUDEN ANDREW P. AVERBACH Assistant Attorney General Solicitor

__s/Thekla Hansen-Young__ __s/Charles E. Mullins__

THEKLA HANSEN-YOUNG CHARLES E. MULLINS Attorney Senior Attorney Appellate Section Office of the General Counsel Environment and Natural U.S. Nuclear Regulatory Commission Resources Division 11555 Rockville Pike U.S. Department of Justice Rockville, Maryland 2085 PO Box 7415, Ben Franklin Station (301) 415-1618 Washington, D.C. 20044 charles.mullins@nrc.gov (202) 307-2710 thekla.hansen-young@usdoj.gov January 8, 2015 11

USCA Case #14-1213 Document #1531045 Filed: 01/08/2015 Page 13 of 13 CERTIFICATE OF SERVICE I certify that on January 8, 2015, I filed Respondents Reply to Petitioners Response to Respondents Motion to Dismiss in Case No. 14-1213 with the U.S.

Court of Appeals for the District of Columbia Circuit by filing it with the Courts CM/ECF system. That method is calculated to serve:

Richard E. Ayers David A. Repka Jessica L. Olson Darani M. Reddick John H. Bernetich Winston & Strawn, LLP Ayers Law Group 1700 K Street, N.W.

1707 L Street, N.W. Suite 850 Washington, D.C. 20006 Washington, D.C. 20036 Thekla Hansen-Young Attorney, Appellate Section Environment and Natural Resources Division U.S. Department of Justice P.O. Box 7415, Ben Franklin Station Washington, D.C. 20044 Respectfully submitted,

__s/Charles E. Mullins__

CHARLES E. MULLINS Senior Attorney Office of the General Counsel U.S. Nuclear Regulatory Commission (301) 415-1618 charles.mullins@nrc.gov 12