ML18018B705

Notice of Receipt of Antitrust Info

ML18018B705
Person / Time
Site:	Harris
Issue date:	06/15/1984
From:	Nerses V Office of Nuclear Reactor Regulation
To:
Shared Package
ML18018B704	List: ML18018B703 ML18018B705
References
NUDOCS 8407090159
Download: ML18018B705 (13)

Text

UNITED STATES NUCLEAR REGULATORY COMMISSION DOCKET NO. 50-400 CAROLINA POWER 8 LIGHT COMPANY NORTH CAROLINA EASTERN MUNICIPAL POWER AGENCY NOTICE OF RECEIPT OF ANTITRUST INFORMATION Carolina Power 8 Light Company has submitted antitrust information related to its application for an operating license for a pressurized water reactor (Shearon Harris Nuclear Power Plant, Unit 1) located in Wake and Chatham Counties, North Carolina, approximately 20 miles southwest of Raleigh.

The data submitted contains antitrust information for review pursuant to NRC Regulatory Guide 9.3 necessary to determine whether there have been any significant changes since the completion of the antitrust review at the construction permit stage.

The construction permit holders for Shearon Harris are Carolina Power 8 Light Company and North Carolina Eastern Municipal Power Agency.

On completion of the staff's antitrust review, the Director of Nuclear Re'actor Regulation will issue an initial finding as to whether there have been "significant changes" under Section 105c(2) of the Atomic Energy Act.

A copy of this finding will be published in the Federal Re ister and will be sent to the Washington, D. C. and local public document rooms and to those persons providing comments or information in response to this notice.

If the initial finding concludes that there have not been any significant changes, requests for reevaluation may be submitted for a period of 30 days after the date of the Federal Reqister notice.

The results of any reevaluation that is requested will also be published in the Federal Re ister and copies sent to the Washington, D. C. and local public document room.

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A copy of the general information portion of the application for an operating license and the antitrust information is available for public examination and copying for a fee at the Commission's Public Document

Room, 1717 H Street, N. W., Washington, D. C.

20555, and at the local public document room at the Wake County Library, 104 Fayetteville Street,

Raleigh, North Carolina 27601.

Any person who desires additional information regarding the matter covered by this notice or who wishes to have his views considered with respect to significant changes related to antitrust matters which have occurred in the applicant's activities since the construction permit antitrust review should submit such requests for information or views to the U. S. Nuclear Regulatory Commission, Washington, D.

C.

20555, Attention:

Chief, Site Analysis Branch, Office of Nuclear Reactor Regulation, on or before July 30, 1984 Dated at Bethesda, Maryland, this 15th day of June,"1984 FOR THE NUCLEAR REGULATORY COMMISSION Y)ct'ar'.Her e/s:,>> ACting Branch Chief L'<icens>>in'g'. BFaK8i.lo,.'-.'

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Docket Nos. 50-346A, 50-440A, 50-44 50-50QA, 50-501A

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The Honorab1e Jesse Helms United States Senate Mashington, D.C.

20510 Dear Senator Helms:

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This is in response to your letter of June 30, 1977 to which you attached a copy of a letter from your constituent, hr.. Hark F. Bennett of New Bern, North Carolina.

Hr. Bennett had itIritten concerning a recent antitrust decision by an Atomic Safety and Licensi'ng Board of the Nuclear Regulatory Commission involving the Cleveland Electric Illuminating Company and others,(Dockets 50-346A, 50-440A, 50 443A,- 50-500A and 50-,501A) and that Board's consideration of the question of "price squeeze".

Hr. Bennett also wished to be advised of possible courses of action at the'RC which might be available to the municipal electric system of New Bern in its rate relationship with Carolina Power 5 Light Company ("CP8L").

Nth respect to the Cleveland matter, on January 6, 1977, an Atomic Safety and Licensing Board issued an initial antitrust decision concluding that the issuance of an unconditioned license for the applied for nuclear

. units woutad create'nd maintain a situation inconsistent with the anti-trust 1'aws.

A copy of the decisio~, 7ihich is.,presently on appeal to the Atomic Safety and Licensing Appeal Board, is attached hereto.

The question of "price squeeze" is discussed on pages 208 to 2'Il of that decision.

Although the Licensing Board ordered the imposition of antitrust license conditions, it did not seek to adjust any rates.

It should be noted that wholesale'rates of electric utilitfes are set by the Federal Power Cormission and industrial rates are determined by state public utility comnissions.

Pursuant to the recent Supreme Court decisfon in Federal Power Commission V.

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Cor., 426 U.S; 273 (1976)~ the F.P.C..has aut or ty to exam ne pr ce squeeze allegations.

Mhfle the FPC may not set retail rates. it may consider them in setting the wholesa1e rate.

COL has applied for licenses to.construct and operate the Shearon Harris

'Nuclear Peter Plant Units 1, 2, 3, and 4 {Docket Nos. 50-400A, 50-401A,,

50-'402A and 50-403A).

CP8L has previously agreed to the impositi'on of antitrust license conditions (attached hereto) ivith respect to those units.

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The yntitrust intervention period as set forth in the Commission's Rules of Practice c

ing which New Bern could, file a timely intervention petition exp d in 1972.

A subsequent antitrust review with respect to those uni 4 would only occur if the Commission found that significant changes in t'roposed project exist.

Of course, New Bern would have an opportuni~

to raise antitrust "questions with respect to any future applications

.;y CP8L for authorization to construct,comercial nuclear power reactors.

If any further information on this matter is desired, please contact Sincerely, W111iarn J. Dirc1-Assistant Executive Director for Operations Encl osures:

1 Initial Decision

{Antitrust) Perry.

2. Commitments for CP8L.

,3. Return of-Incoming 1etter Distr ibution:

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UNITEDSTATES NUCLEAR REGULATORYCOMMISSION WASHINGTON, D. C. 20555 Docket

. 50-346A, 50-440A, 50-441A, 50-500A, 50-501A$ 50-400A, 0-401A, 50-402A, 50-403A The Honorable J

se Helms United States Sen te Washington, D.C.

510 Dear Senator Helms:

This is in response to yo letter of June 30, 1977 to which you attached a copy of a letter rom your constituent, Mr. Mark F. Bennett of New Bern, North Carolina.

r. Bennett had written concerning a

recent antitrust decision by a Atomic Safety and Licensing Board of the Nuclear Regulatory Commissio

("NRC") involving the Cleveland Electric Illuminating Company (Doc ets 50-346A, 50-440A, 50-441A, 50-500A and 50-501A) and that Board's nsideration of the question of "price squeeze".

Mr. Bennett also wi ed to be advised of possible courses of action at the NRC which mig be available to the municipal electric system of New Bern in its rate lationship with Carolina Power

& Light Company ("CP8L").

With respect to the Cleveland matter, on Jan ry 6, 1977, an Atomic Safety and Licensing Board issued an initial a itrust decision with respect to the applications to construct severa nuclear facilities by the Cleveland Electric Illuminating Company, The ledo Edison

Company, Duquesne Light Company, The Ohio Edison

Company, an The Pennsylvania Power Company.

The Licensing Board concluded that a

ivities under the applied for nuclear licenses would create and maintain a situation in-consistent with the antitrust laws.

With respect to th Applicant Ohio Edison

Company, the Licensing Board concluded that Ohio ison charges municipal electric systems purchasing power at wholesale m it significantly higher, and in fact, discriminatory rates, wh compared with similar sales to its industrial customers.

This particu ar finding was but one element of the anticompetitive situation which the icensing Board found to exist.

Although the Board ordered that antitrus license conditions be imposed with respect to each of the five companies, it did not seek to adjust any wholesale or industrial rates.

Various aspe ts of this decision are presently on appeal to the Atomic Safety and Li nsing Appeal Board.

It should be noted that wholesale rates are set by the Federal Power Commission and industrial rates of electric utilities are determined by state public utility commissions.

Pursuant to the recent Supreme Court d

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has authority to examine price squeeze allegations, including, a

corn arison of a proposed wholesale rate with existing industrial and other tail rates.

While the FPC may not set retail rates, it may conside them in setting the wholesale rate.

In respons to Hr. Bennett's snquiry regardin'g antitrust interventio'n by the City f Cleveland in the Cleveland Electric Illuminati.ng.Co..

matter, the C ty of Cleveland timely filed petitions to intervene.'.n dockets 50-346 50-440A and 50-441A within the

30. day time period pro-vided for in the Commission's Rules of Practice (10 CFR Part 2 et

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after publication f the statutorily required Attorney General's anti-trust advice letter in the Federal Register.

With specific referenc to pending applications of CPSL before the Commission, on August 1

1972, the Attorney General through the Assistant Attorney General of the A titrust Division of the Department of Justice, pursuant to the statutory p ocedure set forth in Section 105(c) of the Atomic Energy Act of'954, a

amended, advised the Commission that if CPSL agreed that certain antitrust icense conditions would be included 'in

.'licenses issued by the Commissio for the Shearon Harris Nuclear Power Plant Units 1, 2, 3 and 4 (Docket os.

50-400A,'50-401A, 50-402A, and 50-403A)

, there would be'o need for an antit st hearing.

CPSL has agreed to the imposition of those license condition (attached hereto) and accordingly, the conditions will be attached to the onstruction permits fo'r those units when issued.

.CPSL has previously deferr d these units, but it is presently estimated that an initial construction pe it for Unit 1, with the antitrust conditions attached, will issue in early 19 if so authorized by the Licensing Boar'd wh'ich presides over the safet and environmental phase of the hearing. 'oreover, a subsequent antitrust eview may occur prior to

'he issuance of an operating license if the Comm ssion finds that significant

'" changes in the proposed project have occurred sin the construction permit antitrust review.

Of course, any future applicatio s by CPSL for author-ization to construct conmercial nuclear power reacto s will be the subject of separate antitrust advice from the Attorney Genera and members of the public will have an opportunity to request a hearing o

antitrust matters.

Moreover, prior to rendering his advice, the Assistant A torney General contacts by letter, and solicits the views of each electr system in the area served by the Applicant.

Ifa'urther information on this matter is desired, please contact mei Sincerely, Encl osures:

1.

CommIitrHents for C '1L.

2.

Return of incoming etter Distribution:

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Cotnniitmeot No.

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Licensee recognizes that it is'cncrally io t:hc public interest: for c.lcctric utilitics to iotcrconoect, coordioat.e reserves, aod engage in bull; power supply transactions, in order to.incrca c elect:ric systcnn rcliabilit:y aod reduc>>

t:he costs of electric power.

Bulk power supply arrangcmcots shoo]d bc such as to provide benefits, on balance, each to Licensee and to other part:icipant(s),

respectively.

Thc benefits to participants.io such arraogcnncots ncc.d oot be equal aod thc benefit" realized by a small systan may be proportionately greater than those realized by a larger sy ten.

In implc;ncntiog the conunitmcots which it makes in the succeeding paragraphs, Liccosce will act in accordance with

'. the foregoing principles.

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~Ea lnnat~oo Nota*

(a) Neither. Licensee nor any other participant shall be obligated to enter.

into such arraogements (I) if=to do so woold violate, incapacit:atc, or 3imit its ability to perform aoy other existing contractual arrangement, or (2) to do so would adversely affect i.ts system operations or the reliabi:lity of power suppl> to it:s cust:orner, or (3) if to do so wou3d

)eopardize the applicant's ability to finance or construct on reasonable terms facilities needed to meet its own anticipated system requirements.

Canmitment No.

2 Licensee will interconnect with and coordinate reserves by means of.the sale and exchange of emergency bulk'powc.r with any entity or entitie" i.n its service area>* engaging i,n or proposing to engage in electric bulk power supply on terms that will provide for Licensee's costs (including a reasonable return) in connecti.on therewith; and allow the other participaot:(s),

as well as 3'iccnsee, full access on a proportionate basis to the bcoefits of reserve co-ordination.

g"Proportionate basis" refers to the equalized percentage of rc ervcs concept rather than the largest'ingle-unit

concept, unless all particip'ants otherwise agree.)

Ex lanator Notes (a) Interconnections will not be limited to low voltages when higher voltages

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are available frcxn Liceosee's in"tailed facilities io the area where inter-connection is desired, when thc proposed arrangement's fouod to be tjc'hnically and economically fea'sible.

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• In'order to clarify the commitments, certain explanatory notes have been added.

• Thc use of the term "service area" as found in this commitmeot or in any other sect:ion of thc commitncnts is intended to describe those area" in North Carolina nncl South C'o'olioa whc.rc Licensee provide" sotne class nf elec tric service, but lo>>ov w.cy to.lie.at<<s ao assigwncot ot. allocat.ioo of wholcsa]c. markc.t arc;ts.

(b). 1)iicrg(ncy scrv~

agre@ment.. vill tint hc limi.ti(l to a f.bend imount b<<t emergency serve%

provided ululcr such <<grecm~; will bc fui'>>is)iud iC aiid

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whc>> available aiiil ilcsircil wlicre siicli supply ilocs not 5mpair or tlircatcn to impair service to the iiupplicr's cu..tomers.d<<e to.c:ip<<icity availability fuel sujiply,

.ystcm reliability or. otlicr good caiisc,

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'slial1 not bc~blil,ited to provi<ic. cmcrgciicy scrvicc to aiiotlier cnti.ty in lieu of sucli entity's maint;iiniiig its oui adeq<<ite system reserve.: or fuck

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(c)

An example of the type of re..crve sharing arrangemcnt availalilc to any partici,pint and wliich woold provide "fiillaccess on a proport).onal baszs tn tlie benefits of. reserve coordination" would be onc in which the following conditi.ons woold obtain:

(i.) Tlie Liccns'cc and each pirticipant(s) shall provide to tlie other emergency power if and wlicn available from its own generation, or.

througli its transmission from tlie gcncration of others to the extent it c'n do so without disrupting, or tlireatcning to impair service to its own custoners due to capacity availability, fuel supply, system reliability or other good cause.

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(ii) The partic'ipants to tlie reserve sharing agreement, including-Licensee

~ shall, consistent with Licensee's reserve policy as estab1ishcd from time to time liy Licensee, determine a miniinum percentage reserve to be installed and/or purcha cd by the participants, including I.iccnsec, as necessary to maintain in total an adequate and reliable power supply on tlie interconnected system of Licen ce and participant(s).

J'cxmnitment Ho.

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'icensee will purcliase from or sell "bull; power" to any other enti.ty in its service area engaging in or proposing to engage in tlic generation of electric power in bulk at the seller's cost (including a reasonable return) whenever such transactions would serve to reduce tlic overall costs nf new bulk power

supply, eacli, for itself and other participant(s) to tlie transact:ion, respec-tively.

("Costs" refers to costs of bulk power supply determined in accordanc with tlie seller's normal practices, without regard to the purchaser's intended use of tlie power or the status of the purchaser.)

This paragraph refers spqcifically to 'the opportunity to coordinate in the planning of new gcncrat-ie transinission and a" ociated facilities. If Licensee questions the desirabilit of 8,proposed tran"acti.on on the ground tliat it would not rcducc its overall bulk power costs, it williiiake availab1e upon request to the entity proposing the tzansaction such information as is relevant and reasonably necessary to establish its bulk power costs.

Ex lanator Notes (a) Xt is not to be considered that this condition requires applicant to purcliase or scil bulk power if such purcha e or sale is teclinically infeasible or that the bincfit's therefrom do not exceed the costs in connection witli such purcliase or sale.

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Conin:itmcot No.

4 Lice>>scc will facilitat:c tlie c'xchaogc of bulk power by transinissioo over iLs system bctwcco or among t:wo or more eoti ties wiLli which it: is io(:crcooocctcd on ternis, which vill 1'u3.1y canpcosate it for-t.he service perforincd, to tlic extent tliat sucli arraogcineots rea onably can bc acconimodatctl froni a fuoct:iooal s

aod teclioical standpoint.

~Rs lonotorv. Notes (a) This condition applies to eotitics vitli vliicli l.icensce i.s interconnected in t:he

~ future as well as tlio e to wliich it is now iotcrconocctcd.

Conmitmcnt No.

5 Licensee vill sell power in bulk to any entity in the aforesaid area now engaging in or proposing to engage in the retail distribution of elecLric power.

~Ns lon~stor Notos

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(a) 'Tliis is provided that l.iccnsce

'lias such power available for sale af ter making adequate.provision for the'capacity, fuel and otlier requirements of its service area cusL'o:ners.

Commitmcnt No.

6

, t The implemenLation of tliese numbered paragraphs shal3.'be in all respects on

reasonable terms and condi.t:ions as consist:cnt witli tlie Federal Power Act aod all other 3awful rcgulaL'ioo and authority, and shall be subject to niginceri>>g aod teclinical feasibility for Licensee's sy..tern.

Licensee will negotiate (including the ezecution of' contingent statement of intent) with respect to t;he foregoing conmi.tments with any'nt:ity in its service area engaging in or..-

proposing to engage in bulk power supply transactions,.but Licensee shall not be required t:o enter into any final arrangements prior to resolutioo of.any substantial questions as to the lawful authority of an entity to engage in the transactions.

Canmitment No.

7 In contracts betveen Licensee and its wholesa3.e customers, Li.censce vill not attempt to restrict such cu tuners fran electrically coonecting with other sources

'f power if reasonab3.e written notice to Licensee lias been made and agrccmcot reached by tlie parties on sucll measures or coliditions, if any, as may be required for the protection and reliability of. botli syst:ems.

APPROVED:

DATE:

s Nuclear Rculatory Cu.nviissioo

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