ML19015A066

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Petitioners Motion to Amend Contentions and Motion to Strike
ML19015A066
Person / Time
Site: HI-STORE
Issue date: 01/15/2019
From: Curran D, Eye R, Goldstein M, Lodge T, Reiser C, Taylor W
Beyond Nuclear, Don't Waste Michigan, Emory Univ School of Law, Fasken Land & Minerals, Ltd, Harmon, Curran, Harmon, Curran, Spielberg & Eisenberg, LLP, Law Offices of Wallace L. Taylor, Robert V. Eye Law Office, Sierra Club, Turner Environmental Law Clinic
To:
Atomic Safety and Licensing Board Panel
SECY RAS
References
ASLBP 18-958-01-ISFSI-BD01, Holtec International, RAS 54752
Download: ML19015A066 (41)


Text

January 15, 2019 UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD In the Matter of:

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Holtec International

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Docket No. 72-1051

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HI-STORE Consolidated Interim Storage Facility

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MOTION BY PETITIONERS BEYOND NUCLEAR, FASKEN, THE SIERRA CLUB, AND DONT WASTE MICHIGAN, ET AL. TO AMEND THEIR CONTENTIONS TO ADDRESS NEW INFORMATION CONFIRMING THAT HOLTECS LICENSE APPLICATION CONTAINS FALSE OR MISLEADING STATEMENTS AND MOTION BY PETITIONERS TO STRIKE UNRELIABLE STATEMENTS FROM HOLTECS RESPONSES TO PETITIONERS HEARING REQUESTS I.

INTRODUCTION Pursuant to 10 C.F.R. §§ 2.309(c)(1), Beyond Nuclear, Fasken Land and Minerals and Permian Basin Land and Royalty Owners (Fasken), the Sierra Club, and Dont Waste Michigan, et al. (Dont Waste Michigan, Citizens Environmental Coalition, Citizens for Alternatives to Chemical Contamination, Nuclear Energy Information Service, Public Citizen, San Luis Obispo Mothers for Peace, and Nuclear Issues Study Group) (collectively, Petitioners) hereby move to amend certain of their contentions to address the relevance of a recent statement by Holtec that contradicts language in its license application. In addition, pursuant to 10 C.F.R. §§ 2.319(e) and 2.323(b), Petitioners move to strike statements by Holtecs counsel in response to Petitioners hearing requests which are unreliable, and indeed demonstrably false in light of Holtecs more recent pronouncement.

2 Holtec issued the statement upon which this motion is based in a year-end report on its 2018 business ventures, Holtec Reprising 2018 (Jan. 2, 2019) (emphasis added) (Att. 1)

(Reprising 2018 Report). The report states:

While we endeavor to create a national monitored retrievable storage location for aggregating used nuclear fuel at reactor sites across the U.S. into one (HI-STORE CISF) to maximize safety and security, its deployment will ultimately depend on the DOE and the U.S. Congress.

Id. at 1 (emphasis added). By stating that deployment of the consolidated interim storage facility (CISF) ultimately will depend on the U.S. Department of Energy (DOE) and the U.S.

Congress, Holtec contradicts multiple representations in its license application and pleadings in responses to Petitioners hearing requests that ownership of the spent fuel transported to and stored at the Holtec CISF may lie with either the DOE or a private licensee. Instead, Holtec acknowledges that both involvement by the DOE and Congressional action to change or revoke the Nuclear Waste Policy Act (NWPA) are prerequisites to operating the facility. The Reprising 2018 Report thus establishes that any representations in either the license application or Holtecs pleadings, to the effect that Holtec may operate the proposed CISF as a purely private operation, without DOE ownership of spent fuel, are false and should not be credited.1 Petitioners respectfully request the Atomic Safety and Licensing Board (ASLB) to amend the contentions to consider Holtecs statement in the Reprising 2018 Report and to strike Holtec counsels unreliable and false statements from the record of this proceeding. The relevant contentions and false statements are listed in Section II below.

1 Separately, Petitioners Sierra Club and Dont Waste Michigan et al. intend to file new contentions seeking denial of Holtecs license application on the ground that Holtec has made material false statements disqualifying it from receiving a license under Section 186 of the Atomic Energy Act, 42 U.S.C. § 2236.

3 II.

BACKGROUND A.

Development of Holtecs License Application 2015-2016 While Holtec formally submitted its license application to the Nuclear Regulatory Commission (the Commission or NRC) in 2017, see 83 Fed. Reg. 32,918 (July 16, 2018), it began developing the project several years earlier. During that development period, statements by Holtec officials in press interviews and industry presentations demonstrated that Holtec envisioned DOE ownership of spent fuel in order to go forward with the project. For instance, as reported in the August 7, 2015 edition of SpentFuel, Holtec Vice President Pierre Oneid responded to a question about who would hold title to the spent fuel at the CISF by stating that:

the title issue needs to be worked out but Holtecs vision is that DOE would sign a contract with Holtec to be the customer, and thus DOE would take title to the fuel at the reactor site and be responsible for transporting it to the storage facility, just as it would if DOE were sending the spent fuel to a permanent repository. Holtec is working with DOE, in parallel to its licensing work, to start discussions with DOE about this issue.

See Exhibit 1 to Petition to Intervene and Request for Adjudicatory Hearing by Sierra Club (Sept. 14, 2018) (Sierra Club Petition), cited at page 12 of the Petition. Similarly, in the July 30, 2015 issue of World Nuclear News, Mr. Oneid was quoted as saying, We will surely soon have official talks with them [DOE] on a contract whereby the DOE will hold title to the fuel.

See Sierra Club Petition at 12 and Exhibit 2 to Sierra Club Petition. And a January 2016 Power Point presentation by Holtec Vice President Joy Russell unequivocally represented that Holtec

[r]equires federal funding to construct and operate CISF. See Sierra Club Petition at 12 and Exhibit 3 to Sierra Club Petition.

B.

Holtecs 2018 License Application Holtec applied for a license for the CISF on March 30, 2017. 83 Fed. Reg. at 32,919.

Holtecs license application makes representations about the ownership of the spent fuel that are

4 internally contradictory. Consistent with the representations described in Section A above, Holtecs Environmental Report states that Holtec does not plan to begin construction of the proposed CISF until after Holtec successfully enters into a contract for storage with the U.S.

Department of Energy (DOE). Environmental Report at 1-1. The Environmental Report also states that DOE would be responsible for transporting SNF from existing commercial nuclear power reactor storage facilities to the CIS Facility. Id. at 3-104. Thus, parts of Holtecs Environmental Report demonstrate that Holtec assumes DOE will take responsibility for the spent fuel to be stored at the CISF, beginning with transfer of ownership to DOE at reactor sites before shipment.

Nevertheless, in other parts of Holtecs license application, Holtec hedges the assumption that DOE will own the spent fuel, instead asserting that ownership or liability may rest with either licensees or the DOE. See, e.g.:

  • HI-STORE CIS Facility Financial Assurance and Project Life Cycle Cost Estimates, Rev.

0 (Report No. HI-2177593) at 3 (Additionally, as a matter of financial prudence, Holtec will require the necessary user agreements in place from the USDOE and/or the nuclear plant owners) (emphasis added);

  • License Condition # 17, Proposed License for Independent Storage of Spent Nuclear Fuel at 2 (ADAMS Accession No. ML17310A223) (the construction program will be undertaken only after a definitive agreement with the prospective user/payer for storing the used fuel (USDOE and/or a nuclear plant owner) at the HI-STORE CIS has been established) (emphasis added); and
  • Safety Analysis Report, Table 1.0.2 at 26 (ADAMS Accession No. ML18254A413) (In accordance with 10CFR72.22, the construction program will be undertaken only after a

5 definitive agreement with the prospective user/payer for storing the used fuel (USDOE and/or a nuclear plant owner) at HI-STORE CIS has been established.) (emphasis added).

C.

Petitioners Hearing Requests Each Petitioner submitted a contention challenging Holtecs license application on the ground that it impermissibly relies on federal ownership of spent fuel to be transported to and stored at the proposed CISF.2 The contentions are as follows:

Beyond Nuclears single contention, filed on September 14, 2018, states:

The NRC must dismiss Holtecs license application and terminate this proceeding because the application violates the NWPA. The proceeding must be dismissed because the central premise of Holtecs application - that the U.S. Department of Energy (DOE) will be responsible for the spent fuel that is transported to and stored at the proposed interim facilities - violates the NWPA. Under the NWPA, the DOE is precluded from taking title to spent fuel unless and until a permanent repository has opened. 42 U.S.C. §§ 10222(a)(5)(A), 10143.

Beyond Nuclear Request for Hearing and Petition to Intervene at 10 (Beyond Nuclear Petition).

Faskens Motion to Dismiss asserts that the NRC lacks jurisdiction over Holtecs license application because it is:

premised on the proposition that the U.S. Department of Energy (DOE) will be responsible for the spent fuel that would be transported to and stored at the proposed facilities. This premise is prohibited under the NWPA because the DOE is precluded from taking title to spent fuel until a permanent repository is available. 42 USC §§ 10222(a)(5)(A), 42 USC § 10143.

2 Fasken submitted a motion to dismiss the entire licensing proceeding to the NRC Commissioners. Motion of Fasken Land and Minerals and Permian Basin Land and Royalty Owners to Dismiss Licensing Proceedings for Hi-Store Consolidated Interim Storage Facility and WCS Consolidated Interim Storage Facility (Sept. 14, 2018) (Fasken Motion to Dismiss).

In an Order dated October 29, 2018, the Commission referred the motion to the ASLB for consideration as a hearing request.

6 Fasken Motion to Dismiss at 1-2.3 Sierra Clubs Contention 1 asserts:

The NRC has no authority to license the Holtec CIS facility under the NWPA nor the AEA. Holtec has said DOE must take title to the waste, but the NWPA does not authorize DOE to take title to spent fuel in an interim storage facility. The AEA has no provision for licensing a CISF.

Sierra Club Petition at 10 (Sept. 14, 2018).

Dont Waste Michigan, et al.s Contention 2 asserts:

Holtec cannot provide reasonable assurances that it can obtain the necessary funds to cover the costs of construction, operation maintenance and decommissioning of the CISF.

Petition of Dont Waste Michigan, Citizens Environmental Coalition, Citizens for Alternatives to Chemical Contamination, Nuclear Energy Information Service, Public Citizen, Inc., San Luis Obispo Mothers for Peace and Nuclear Issues Study Group to Intervene and Request for an Adjudicatory Hearing at 31 (DWM Petition).

All of the above-cited contentions and Faskens Motion to Dismiss rely in part on statements in Holtecs Environmental Report and statements made in 2015 and 2016 by Holtec officials (see Sections II.A and II.B above) that Holtec assumes DOE will take title to the spent fuel during transportation to the CISF and storage at the CISF. See Beyond Nuclear Petition at 10 (incorporating Sections IV and V of Beyond Nuclears Motion to Dismiss Licensing Proceedings for Hi-Store Consolidated Interim Storage Facility and WCS Consolidated Interim Storage Facility for Violation of the Nuclear Waste Policy Act at 16 (Sept. 14, 2018) (Beyond Nuclears Motion to Dismiss); Fasken Motion to Dismiss at 7 (incorporating Beyond Nuclears Motion to Dismiss at 16); Sierra Club Petition at 11-13; DWM Petition at 32-34.

3 Fasken also moved to dismiss a similar license application by Interim Storage Partners and Waste Control Specialists for a CISF in Texas, but that application is not at issue here.

7 D.

Holtecs Responses to Petitioners Hearing Requests In responding to Petitioners contentions and Faskens Motion to Dismiss, Holtec has disavowed the statements in the Environmental Report and other statements by Holtec officials to the effect that Holtec assumes the DOE will take title to spent fuel to be transported to and stored at the proposed CISF.

1. Disavowal of Environmental Report For instance, in response to Beyond Nuclears Petition (which incorporates Beyond Nuclears Motion to Dismiss), Holtec states:

The Motion to Dismiss cites to a few references in the Environmental Report that suggest a broader DOE role by omitting the nuclear plant owner portion of the USDOE and/or a nuclear plant owner allocation of responsibility. These references are inconsistent with Holtecs intent and are in the process of being revised to eliminate any confusion and make clear that the Application is not based on DOE taking or holding title to the spent fuel which would be stored at the CISF. In any case, a contention based on an erroneous factual premise should not be admitted.

Holtec Internationals Answer Opposing Beyond Nuclear Inc. Hearing Request and Petition to Intervene on Holtec Internationals HI-STORE Consolidated Interim Storage Facility Application at 20-21 (Oct. 9, 2018) (Holtec Response to Beyond Nuclear) (emphasis in original) (footnote omitted).4 Holtec also states:

[Beyond Nuclears] contentions factual predicate - its central premise - is that the DOE will be responsible for the spent fuel that is transported to and stored at the proposed interim facilities. Id. at 10. This central predicate, that DOE will hold title to the spent fuel that will be stored at the CISF, is incorrect. While the Petition itself does not explain the basis for this conclusion, it references the more detailed discussion of this issue in the Beyond Nuclear, Inc. Motion to Dismiss Licensing Proceedings for HI-STORE Consolidated Interim Storage Facility and WCS Consolidated Interim Storage Facility of Violating of the Nuclear Waste Policy Act, dated September 14, 2018 4 With respect to Holtecs claim that statements in the Environmental Report are in the process of being revised, Holtec provides no citation to any revised Environmental Report. A search of NRCs Agencywide Document Access and Management System (ADAMS) on January 14, 2019, for documents issued after July 16, 2018 in Docket No. 72-1051 also did not identify any amendments to Holtecs license application.

8 (Motion). The Motions selective analysis of the HI-STORE CISF application mischaracterizes the role that DOE might play with respect to the HI-STORE CISF and as a result erases Beyond Nuclears claim of a central premise that bars NRC from licensing the facility.

Id. at 19 (footnote omitted).

In response to Faskens Motion to Dismiss, Holtec asserts:

Faskens claim that DOE will be responsible for the spent fuel that would be transported to and stored at the proposed facilities, Motion at 1, is also incorrect. The Application clearly states that either the nuclear plant owners from where the spent fuel originated or the DOE will be the customer for the HI-STORE CIS Facility.

Holtec Internationals Answer Opposing Fasken Land and Minerals and Permian Basin Land and Royalty Owners Motion to Dismiss / Petition to Intervene on Holtec Internationals HI-STORE Consolidated Interim Storage Facility Application at 17 (Dec. 3, 2018) (Holtec Response to Fasken). Further, Holtec asserts:

Although Faskens pleadings make no reference to them, statements in the Environmental Report that suggest a broader DOE role by omitting the nuclear plant owner portion of the USDOE and/or a nuclear plant owner allocation of responsibility are inconsistent with Holtecs intent and are in the process of being revised to eliminate any confusion and make clear that the Application is not based on DOE taking or holding title to the spent fuel which would be stored at the CISF. In any case, the Environmental Report has been amended to remove these inconsistent references.

Id. at 18 (footnote omitted) (emphasis in original).5 And Holtec states:

[P]roposed License Conditions 17 and 18 discussed above, and not otherwise challenged in this contention, would provide that either DOE or a nuclear plant owner could be the customer for HI-STORE. If DOE is not authorized to be the customer, the nuclear plant owner is the default party to comply with License Conditions 17 and 18. Thus, the issue raised by the contention is ultimately irrelevant to the licensability of the HI-STORE-CIS facility.

Id. at 18.

In response to the Sierra Clubs contention, Holtec states:

5 With respect to Holtecs claim that statements in the Environmental Report are in the process of being revised, Holtec provides no citation to any revised Environmental Report.

9 The Petitioner asserts that the CISF Application assumes that the Department of Energy (DOE) will take ownership of the spent fuel to be stored at the Holtec site. Pet. at 11.

To support this assertion, the Contention ignores or misconstrues provisions in the Application that make clear that title and ownership of the spent fuel to be stored at the CISF will be held either by DOE or the nuclear plant owner.

Holtec Internationals Answer Opposing Sierra Clubs Petition to Intervene and Request for Adjudicatory Hearing on Holtec Internationals HI-STORE Consolidated Interim Storage Facility at 17-18 (Oct. 9, 2018) (Holtec Response to Sierra Club Petition). And:

The Contention cites to a reference in the Environmental Report that suggest a broader DOE role by omitting the nuclear plant owner portion of the USDOE and/or a nuclear plant owner allocation of responsibility.76 These references are inconsistent with the provisions discussed above and are in the process of being revised to eliminate any confusion and make clear that the Application is based on DOE and/or the nuclear plant owner taking or holding title to the spent fuel which would be stored at the CISF. In any case, a contention based on an erroneous factual premise should not be admitted.

Id. at 19. Finally, Holtec asserts:

As demonstrated, the Contentions assumption that DOE taking title is central to the CISF Application is in error.

Id. at 20.

In responding to Dont Waste Michigan, et al., Holtec states:

Contention 2 is based on Petitioners misinterpretation of the information Holtec provided in its Application to demonstrate its financial qualifications in accordance with NRC regulations.

The crux of Contention 2 is Petitioners claim that Holtec will not construct the CISF without financial guarantees from the U.S. Department of Energy. As the Application makes clear, this is not true.

Holtecs Answer Opposing the Dont Waste Michigan, Citizens Environmental Coalition, Citizens for Alternatives to Chemical Contamination, Nuclear Energy Information Service, Public Citizen, San Luis Obispo Mothers for Peace, and Nuclear Issues Study Group Petition to Intervene and Request for an Adjudicatory Hearing on Holtec Internationals HI-STORE

10 Consolidated Interim Storage Facility Application at 28-29 (Oct. 9, 2018) (Holtec Response to DWM). Similarly, Holtec states:

Use of the term and/or makes it clear that, contrary to Petitioners claims in Contention 2, Holtec is not relying on DOE contracts to demonstrate its financial qualifications.

Id. at 31. And:

Contention 2 repeatedly and incorrectly claims that Holtec is relying on contracts with DOE to show that it is financial qualified to construct, operate, and decommission the CISF.

Id. Similarly, Holtec asserts:

The Commission should reject [Dont Waste Michigan, et al.s] arguments. They are all based on Petitioners incorrect conclusion that Holtecs financial qualification demonstration is dependent upon contracts under which DOE takes title to spent nuclear fuel for interim storage. As shown above, the Application makes it clear that the projects financing will be provided from the Companys resources and is not dependent on DOE contracts. Accordingly, Petitioners arguments regarding whether the NWPA authorizes DOE to enter into agreements to take title to spent nuclear fuel for purposes of interim storage are irrelevant to whether Holtec has demonstrated its financial qualifications.

Id. at 32 (emphasis added). Holtec also asserts that Nothing in the Financial Assurance Plan - or in any part of the Application - indicates that Holtec considers DOE to be the CISFs sponsoring party. Id. at 33. And Holtec insists that DOE will not necessarily be the user/payer for storing the used fuel under License Condition 17 (See Section II.A above) because [i]t says that prospective users/payers for spent fuel storage at the CIS would be USDOE and/or a nuclear plant owner. Id. at 34 (emphasis in original).

2. Disavowal of statements by company officials In responding to Petitioners contentions, Holtec has also disavowed, as outdated and in any event merely aspirational, the 2015 and 2016 public statements of its officials discussed in Section II.A above. For instance, in response to the Sierra Club Petition, Holtec states:

11 The Contention also cites to several public statements which Petitioner asserts show[]

Holtecs intention that DOE must take title to the radioactive waste before Holtec will begin to construct the proposed CIS facility. Pet. at 12. It should first be noted that each of the statements cited by the Contention predate that Application. Second, none of the statements talk about a Holtec requirement that DOE take title for the project to go forward. For example, the 2015 SpentFuel article summarized a Holtec statement that a contract with DOE including its taking title was Holtecs vision, id. and Pet. Ex. 1; the 2016 PowerPoint presentation says the project requires federal funding, which could occur the same way the on-site ISFSIs are typically funded, i.e., by DOE settlement payments or final judgments to the utilities from their breach of contract lawsuits against the Government; the 2015 World Nuclear News article that Holtec will [] soon have official talks with [the DOE] on a contract whereby the DOE will hold title to the fuel, Pet. at 12, and Ex. 3...

As demonstrated, the Contentions assumption that DOE taking title is central to the CISF Application is in error.

Holtec Response to Sierra Club at 19-20 (footnotes omitted) (emphasis added).

Similarly, in response to Dont Waste Michigan, et al, Holtec states:

Petitioners also cite three quotations from Holtec personnel. The quotations upon which Petitioners rely from Spent Fuel and World Nuclear News are from 2015, predating the Application which was submitted in 2017. Those statements discuss Holtecs vision for the project, and how Holtec would be discussing with DOE whether DOE will hold title to the fuel.132 Nothing in these statements indicate that Holtec relied (then or now) on a contract with DOE to satisfy the NRCs financial qualifications requirement. Nor do those quotes contradict statements in the Financial Assurance Plan that Holtec will fund the plant from its own resources, and that Holtec will enter into customer contracts with DOE and/or nuclear plant owners. At most, they show that Holtec would be pursuing DOE as a customer.

Finally, Petitioners quote from a January 2016 presentation, which included one bullet point on a slide which stated that Holtec [r]equires federal funding to construct and operate the CISF. That presentation was given in January of 2016 - more than a year before Holtec submitted its Application to the NRC. As the Financial Assurance Plan states, Holtec will fund the project from its own resources and plans to enter into customer contracts with DOE and/or nuclear plant owners. Petitioners have provided no basis to disregard the statements in the Application in favor of a bullet in a slide presentation given more than a year before the Application was filed.

Holtec Response to DWM at 34-35 (footnotes omitted).

12 E.

Holtecs January 2, 2019 Report Reprising 2018 As discussed in Section I above, the recent Reprising 2018 Report, issued by Holtec at the beginning of this year, makes clear that DOE involvement in the CISF project is a prerequisite for operation of the proposed CISF. In particular, the Report states:

While we endeavor to create a national monitored retrievable storage location for aggregating used nuclear fuel at reactor sites across the U.S. into one (HI-STORE CISF) to maximize safety and security, its deployment will ultimately depend on the DOE and the U.S. Congress.

Id. at 1 (emphasis added). This statement demonstrates that Holtec assumes that DOE will, in fact, take the role of spent fuel owner assumed in certain parts of the Environmental Report. This statement also effectively acknowledges that DOE ownership of spent fuel prior to the opening of a repository is unlawful under the NWPA, and therefore that Congressional action will be required before DOE can take title to the spent fuel.

III.

REQUEST FOR LEAVE TO AMEND CONTENTIONS A. Applicable Standards NRC regulation 10 C.F.R. § 2.309(c) allows a petitioner to amend its contentions if the presiding officer finds that the petitioner has demonstrated good cause by satisfying the following factors: (i) the information on which the filing is based was not previously available; (ii) the information upon which the filing is based is materially different from information previously available; and (iii) the filing has been submitted in a timely fashion based on the availability of the subsequent information. An amended contention generally is considered timely if it is filed within 30 days of the date upon which the new information became available.

Shaw AREVA MOX Services (Mixed Oxide Fuel Fabrication Facility), LBP-08-11, 67 N.R.C.

460, 493 (2008) (Many times, boards have selected 30 days as [the] specific presumptive time period for timeliness of contentions filed after the initial deadline).

13 Petitioners respectfully submit that permitting the amendment of a contention is appropriate where new information shows that material statements in a license application are false or incorrect, given the importance placed by the Commission on completeness and accuracy of information submitted by applicants and licensees and the Commissions demand for [n]othing less than candor. Randall C. Orem, D.O., CLI-93-14, 37 N.R.C. 423, 427 (1993)

(citing Petition for Emergency and Remedial Action, CLI-78-6, 7 N.R.C. 400, 18 (1978); Hamlin Testing Laboratories, Inc., 2 A.E.C. 423, 428 (1964), affd, 357 F.2d 632 (6th Cir. 1966);

Virginia Electric and Power Co. (North Anna Power Station, Units 1 & 2), CLI-76-22, 4 N.R.C.

480 (1976), affd, 571 F.2d 1289 (4th Cir.1978)).

B. Request for Leave to Amend Contentions Petitioners seek to amend Beyond Nuclears single contention, Faskens Motion to Dismiss, Sierra Clubs Contention 1, and Dont Waste Michigan, et al.s Contention 2 to include in their basis statements the statement by Holtec that:

While we endeavor to create a national monitored retrievable storage location for aggregating used nuclear fuel at reactor sites across the U.S. into one (HI-STORE CISF) to maximize safety and security, its deployment will ultimately depend on the DOE and the U.S. Congress.

Reprising 2018 Report at 1 (emphasis added). By stating that deployment of the CISF ultimately will depend on the DOE and the U.S. Congress, Holtec contradicts its own license application and the responses to Petitioners hearing requests submitted by Holtecs attorneys, to the effect that the CISF may be a completely private operation, without involvement by the DOE. Instead, the Reprising 2018 Report acknowledges that both involvement by the DOE and Congressional action to change or revoke the NWPA are prerequisites to operating the facility.

The statement also shows that, contrary to representations by Holtecs counsel, statements made by Holtec officials prior to submitting the license application, and statements in

14 the Environmental Report that Holtec assumed DOE ownership of spent fuel, were not incorrect or aspirational statements subject to change. The either or language in the license application, presenting DOE or private ownership of spent fuel as possible alternatives, is inconsistent with Holtecs representations outside of this licensing proceeding that DOEs involvement in the project is essential. In order to ensure that the record of this proceeding is accurate, the ASLB should permit Petitioners to amend their contentions.

C. Demonstration That the Factors in 10 C.F.R. § 2.309(c)(i) - (iii) Are Satisfied.

Petitioners satisfy the three-prong test for good cause to file amended contentions based on new information, as follows:

(i) The information upon which the filing is based was not previously available.

The Reprising 2018 Report on which Petitioners rely was not publicly available until January 2, 2019.

(ii) The information upon which the filing is based is materially different than information previously available.

The statement in the Reprising 2018 Report is materially different from Holtecs license application, which suggests that DOE may or may not be involved in the proposed CISFs operation. The statement now shows that DOE involvement is a prerequisite. The statement also confirms that accuracy of statements made by Holtec officials prior to submitting the license application that DOE participation in the project is assumed. Finally, the statement shows that Holtec understands that DOE involvement in the CISF project would be illegal under the NWPA unless Congress acts to amend the law.

(iii) The filing has been submitted in a timely fashion based on the availability of the subsequent information.

15 The amended contention is being filed within 30 days of Petitioners having learned of the issuance of the Reprising 2018 Report, and therefore is timely. Shaw AREVA MOX Services, 67 N.R.C. at 493.

IV.

MOTION TO STRIKE FALSE STATEMENTS FROM HOLTECS RESPONSE TO HEARING REQUESTS A. Applicable Standards In a license proceeding:

A presiding officer has the duty to conduct a fair and impartial hearing according to law

[Thus] the presiding officer has all the powers necessary to those ends, including the powers to strike any portion of a written presentation or a response to a written question that is unreliable [and] restrict unreliable evidence and/or arguments.

10 C.F.R. §2.319.

In addition, counsel in NRC proceedings have an obligation to assure that representations made in all pleadings to the best of [their] knowledge, information and belief are true. Nuclear Mgmt. Co., LLC (Palisades Nuclear Plant), LBP 06-10, 63 N.R.C. 314, 333 (Mar.

7, 2006) (footnotes omitted); see 10 C.F.R. §2.304. They also have an ethical responsibility not to knowingly make a false statement of fact or law to a tribunal or fail to correct a false statement of material fact or law previously made to the tribunal by the lawyer.

Id. Deliberately false statements are also subject to sanctions. Consumers Power Co. (Midland Plant, Units 1 & 2), CLI-83-2, 17 N.R.C. 69, 70 (1983).

Furthermore, all counsel have a continuing duty to update a tribunal of any development which may conceivably affect the outcome of litigation. Id., 63 N.R.C. at 333 (internal citations omitted). NRC precedent also requires parties to NRC proceedings to alert adjudicatory bodies to information relevant to matters being adjudicated. Id.

16 As provided by 10 C.F.R. § 2.323(b), a motion is considered timely if it is filed within ten days of the precipitating event.6 B. Argument Petitioners respectfully request the ASLB to strike all of the language in Holtecs responses to their contentions that is quoted in Section II.D above. Redlined excerpts of Holtecs responses are attached. See Holtec Response to Beyond Nuclear (Att. 2); Holtec Response to Fasken (Att. 3); Holtec Response to Sierra Club (Att. 4); Holtec Response to DWM (Att. 5).

Holtecs statements are unreliable because they are contradicted by the statement in the Reprising 2018 Report. Holtecs counsels assertions that its officials public statements from 2015 and 2016 and its Environmental Report are outdated or aspirational statements subject to change are false. In fact, Holtec has never altered its fundamental assumption that DOE participation is essential to the completion and operation of the CISF. The only thing that has changed is the addition of misleading language in the license application, which deceives the reader into thinking that the facility could be a completely private endeavor. And Holtecs counsel compounded the obfuscation in its responses to Petitioners. In order to ensure that erroneous representations by counsel do not lead to the consideration of unreliable factual evidence in the ASLBs admissibility determinations, it should strike the erroneous and unreliable statements from Holtecs responses.

V.

CONCLUSION For the foregoing reasons, the ASLB should grant Petitioners Motions.

Respectfully submitted, 6 Pursuant to 10 C.F.R. § 2.306(a), the January 14, 2019 effective deadline for a timely Motion to Strike was extended until today, January 15, by virtue of the NRCs emergency closure on January 14 due to inclement weather.

17

___/signed electronically by/__

Diane Curran Harmon, Curran, Spielberg, & Eisenberg, L.L.P.

1725 DeSales Street N.W., Suite 500 Washington, D.C. 20036 240-393-9285 dcurran@harmoncurran.com

__/signed electronically by/___

Mindy Goldstein Emory University School of Law Turner Environmental Law Clinic 1301 Clifton Road Atlanta, GA 30307 404-727-3432 magolds@emory.edu

__/signed electronically by/__

Caroline Reiser Turner Environmental Law Clinic Emory University School of Law 1301 Clifton Road Atlanta, GA 30322 404-727-9907 caroline.j.reiser@emory.edu Counsel to Beyond Nuclear

/electronically signed by/

Robert V. Eye, KS S.C. No. 10689 Robert V. Eye Law Office, L.L.C.

4840 Bob Billings Pky., Suite 1010 Lawrence, Kansas 66049 785-234-4040 Phone 785-749-1202 Fax bob@kauffmaneye.com Counsel to Fasken Land and Minerals and Permian Basin Land and Royalty Owners

__/signed electronically by/__

Wallace L. Taylor Law Offices of Wallace L. Taylor 4403 1st Ave. S.E., Suite 402 Cedar Rapids, Iowa 52402 319-366-2428;(Fax)319-366-3886 e-mail: wtaylorlaw@aol.com

18 Counsel to Sierra Club

__/signed electronically by/__

Terry J. Lodge 316 N. Michigan St., Suite 520 Toledo, OH 43604-5627 (419) 205-7084 tjlodge50@yahoo.com Counsel for Dont Waste Michigan, et al.

January 15, 2019 CERTIFICATE OF COUNSEL Pursuant to 10 C.F.R. § 2.323(b), I certify that on January 11, 2019, I contacted counsel for the other parties to this case by e-mail to seek their consent to Petitioners Motion to Amend and their Motion to Strike. Counsel for Holtec responded that based on Holtecs understanding of the motions, Holtec will oppose them. Counsel for the NRC Staff responded on January 14, 2019, as follows: [T]he Staff is unlikely to support the motions because, on its face, it is unclear how such a generalized statement in a newsletter bears upon the issues of ownership of spent fuel or title of spent fuel, the issues raised in the contention. Thus, it does not appear why the proposed contention needs to be amended based on the newsletter or how the statements in the newsletter demonstrate that statements in the Holtec filing need to be stricken, and why. That being said, the Staff ultimately reserves judgment on the motions until after it has reviewed the motions.

No other counsel responded to the e-mail.

___/signed electronically by/__

Diane Curran January 15, 2019

19 UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD In the Matter of

)

)

Holtec International

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Docket No. 72-1051

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(HI-STORE Consolidated Interim

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Storage Facility)

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)

CERTIFICATE OF SERVICE I hereby certify that on January 15, 2019, MOTION BY PETITIONERS BEYOND NUCLEAR, FASKEN, THE SIERRA CLUB, AND DONT WASTE MICHIGAN, ET AL. TO AMEND THEIR CONTENTIONS TO ADDRESS NEW INFORMATION CONFIRMING THAT HOLTECS LICENSE APPLICATION CONTAINS FALSE OR MISLEADING STATEMENTS AND MOTION BY PETITIONERS TO STRIKE UNRELIABLE STATEMENTS FROM HOLTECS RESPONSES TO PETITIONERS HEARING REQUESTS was posted on the NRCs Electronic Information Exchange System.

___/signed electronically by/__

Diane Curran Harmon, Curran, Spielberg, & Eisenberg, L.L.P.

1725 DeSales Street N.W., Suite 500 Washington, D.C. 20036 240-393-9285 dcurran@harmoncurran.com

HH 34.01 l January 2, 2019 Page 1 of 5 Holtec Highlights For more information, please contact: Erika Grandrimo l (856) 797-0900, ext. 3920 l e.grandrimo@holtec.com Holtec Reprising 2018 At Holtec, 2018 will be remembered as the year when the Companys four-year quest to launch its decommissioning program reached a successful milestone. Three nuclear power plants, including Exelons Oyster Creek Generating Station, and Entergys Pilgrim Nuclear Power Station and Palisades Nuclear Generating Station, as well as the site of the decommissioned Big Rock Point Nuclear Power Plant near Charlevoix, Michigan, where only the Independent Spent Fuel Storage Installation (ISFSI) remains, are under purchase/sale agreements to transfer their licenses, spent fuel and Nuclear Decommissioning Trusts to Holtec for accelerated decommissioning subject to U.S. NRCs concurrence. As of this writing, the U.S. NRC has accepted the License Transfer Applications for these agreements. In another strategic development, Holtec and SNC-Lavalin (Canada) established a joint venture company named Comprehensive Decommissioning International, LLC (CDI) to carry out decommissioning projects around the world. Holtecs subsidiary, Holtec Decommissioning International (HDI), will hold the Plants licenses and manage the Companys nuclear assets. CDI and HDI are off to a running start, both dedicated to the safe, rapid, and economic decommissioning of shut down nuclear power plants.

Holtecs effort to establish the HI-STORE CISF (consolidated interim storage facility) in New Mexico remains on track for licensing in 2020 with the NRC acceptance of the license application early in 2018. Numerous meetings across New Mexico were held by Holtec throughout the year to inform the citizens and solicit their opinions. Local public sentiment remains in favor of the Project in the nuclear savvy region of New Mexico. In accordance with the NRC licensing process, an Atomic Safety Licensing Board (ASLB) was established to preside over the HI-STORE CISF licensing process. While we endeavor to create a national monitored retrievable storage location for aggregating used nuclear fuel at reactor sites across the U.S.

into one (HI-STORE CISF) to maximize safety and security, its deployment will ultimately depend on the DOE and the U.S.

Congress.

Another ambitious Company program, designing and licensing a transformative 160 MW(e) light water reactor, SMR-160, made major strides in 2018 supported by our partners Mitsubishi Electric Corporation and SNC-Lavalin Nuclear. The Canadian Nuclear Safety Commission (CNSC) began review of the SMR-160s safety attributes and candidate designs in 2018. Significant progress has been made, with the first phase of review expected to conclude in late 2019. The results of the engagement are expected to serve as a springboard for future licensing activities globally. The first anticipated leveraging of this regulatory review is expected to be in Ukraine. Early in 2018, the Company announced that Holtec International and NAEK Energoatom, Ukraines national nuclear operator (one of the worlds largest nuclear operators),

had signed a Memorandum-of-Understanding that envisages Ukraine to deploy SMR-160s at the Rivne Nuclear Power Plant.

We would like to thank U.S. DOE Secretary Rick Perry for touring Holtecs Advanced Manufacturing Facility and Corporate Engineering Office at the Krishna P. Singh Technology Campus in October and for offering his very enthusiastic remarks to the Holtec staff regarding development of our small modular reactor, the SMR-160, and the preparations we have made in advanced manufacturing to deploy U.S. small modular reactor (SMR) technology worldwide. The Secretarys visit was complimented by the award to Holtecs SMR, LLC subsidiary under the DOE Funding Opportunity Announcement for Advanced Nuclear Technology Development. Through this DOE FOA award SMR, LLC will receive cost-shared financial -- Holtec Reprising 2018 Report

HH 34.01 l January 2, 2019 Page 2 of 5 Holtec Highlights For more information, please contact: Erika Grandrimo l (856) 797-0900, ext. 3920 l e.grandrimo@holtec.com assistance beginning in 2019 for the development of an Integral and Separate Effects Test Program for validation of passive safety system performance of the SMR-160. This marks the first government funding for development of the SMR-160. The results of this program will benefit and accelerate the licensing of other SMRs in development for deployment in the U.S. and abroad. Led by Holtecs subsidiary named Holtec Government Services, a second DOE award was received under this FOA program for Advancing and Commercializing Hybrid Laser Arc Welding (HLAW) for Nuclear Vessel Fabrication, which will further advance manufacturing capabilities and the competitive position of U.S. manufactured SMRs. Another significant government related accomplishment in 2018 was the U.S. Small Business Administrations approval of a Mentor-Protégé Joint Venture with Gilmartin Engineering through the All Small Mentor-Protégé Program.

Through this Small Business Administration program, Oak Ridge Technologies, LLC, a Joint Venture of Holtec and Gilmartin, will be able pursue small business set-aside government contracts with all the resources and capabilities that the Mentor-Protégé can offer.

In Holtecs core business of dry storage and transport of used nuclear fuel, several new benchmarks were set: a record-breaking 179 dry storage systems at 20 plants were loaded in 2018, every loaded system beating its targeted dose allotment. The number of U.S. nuclear units served by Holtecs technology surged to 65, with 8 new units switching their allegiance to the HI-STORM technology in 2018. Holtecs worldwide total of nuclear units served by the Companys dry storage and transport systems now stands at 116 in 13 countries. The Companys used fuel program, however, faces strong headwinds as the tariffs on steel and aluminum raise our production cost relative to our rivals who are not affected by the tariffs. Ship loads of regulator-approved storage, and transport equipment and ancillaries for VVER fuel (Russian origin reactors) were delivered to Ukraines Rivne Nuclear Power Plant for the Countrys soon-to-be commissioned Central Spent Fuel Storage Facility in the Chernobyl Exclusion Zone.

UAEs Barakah, Exelons Nine Mile Point, Duke Energys Harris and KHNPs Shin-Hanul in South Korea were principal Customers of Holtecs wet storage technology and consulting services in 2018. Bookings and deliveries of Holtecs staple capital equipment such as air-cooled and water-cooled condensers, feedwater heaters and nuclear plant heat exchangers continued apace in 2018.

To strengthen its corporate governance in proportion to its growing breadth of operations, the Company named two new members to its Executive Committee; they are Ms. Pamela Cowan and Dr. Richard Springman (both pictured below).

Holtecs 21-year veteran, Ms. Joy Russell was promoted to Senior Vice President of Business Development and Communications (see photo below). The momentous work of creating a robust digital eco-system to power the Companys growth accelerated in 2018 with its prime mover, Mr. Alok Ranjan, (pictured below) was fittingly honored as Holtec Fellow-2018 (the honor bestowed on one outstanding Holtec associate at each year-end).

HH 34.01 l January 2, 2019 Page 3 of 5 Holtec Highlights For more information, please contact: Erika Grandrimo l (856) 797-0900, ext. 3920 l e.grandrimo@holtec.com Ms. Pamela Cowan, Senior Vice President and Chief Operations Officer of Holtec Decommissioning International Dr. Richard Springman, Vice President of International Projects

HH 34.01 l January 2, 2019 Page 4 of 5 Holtec Highlights For more information, please contact: Erika Grandrimo l (856) 797-0900, ext. 3920 l e.grandrimo@holtec.com Ms. Joy Russell, Senior Vice President of Business Development and Communications Mr. Alok Ranjan, Holtec Fellow-2018 Award Recipient

HH 34.01 l January 2, 2019 Page 5 of 5 Holtec Highlights For more information, please contact: Erika Grandrimo l (856) 797-0900, ext. 3920 l e.grandrimo@holtec.com Holtec Asia, based in Pune, India, continued to grow in human resources and industry esteem adding over 30 engineers to its staff and providing air-cooled condensers to numerous Clients from its manufacturing plant in Dahej (Gujarat, India).

Holtec Ukraine, based in Kiev, continues to develop as a major technology center for the Company with expertise in nuclear sciences and thermal-hydraulics. Holtec's joint venture in South Africa, Holtec Africa, continues to grow with new orders in the fossil power sector and site services for the nuclear industry, including a team of fuel handlers. Sizlon Limited, our U.K. subsidiary, continues to serve EDF Energy with distinction. Holtec has also established a new operations center this past year in South America, Holtec do Brasil, to serve Eletronuclear with expectations to expand into the broader power markets in 2019.

From all Holtec International associates around the globe, we wish you, our valued stakeholders, a safe, healthy and prosperous 2019.

19 A.

The Contention Misconstrues the DOEs Role The contentions factual predicate - its central premise - is that the DOE will be responsible for the spent fuel that is transported to and stored at the proposed interim facilities.

Id. at 10. This central predicate, that DOE will hold title to the spent fuel that will be stored at the CISF, is incorrect. While the Petition itself does not explain the basis for this conclusion, it references the more detailed discussion of this issue in the Beyond Nuclear, Inc. Motion to Dismiss Licensing Proceedings for HI-STORE Consolidated Interim Storage Facility and WCS Consolidated Interim Storage Facility of Violating of the Nuclear Waste Policy Act, dated September 14, 2018 (Motion).38 The Motions selective analysis of the HI-STORE CISF application mischaracterizes the role that DOE might play with respect to the HI-STORE CISF and as a result erases Beyond Nuclears claim of a central premise that bars NRC from licensing the facility.

The application clearly states that either the nuclear plant owners from where the spent fuel originated or the DOE will be the customer for the HI-STORE CIS Facility. For example, proposed License Condition #17 states that the construction program will be undertaken only after a definitive agreement with the prospective user/payer for storing the used fuel (USDOE and/or a nuclear plant owner) at [the] HI-STORE CIS has been established.39 Similarly, License Condition #18 states that [t]he licensee [i.e., Holtec] shall: (1) include in its service contracts provisions requiring customers to retain title to the spent fuel stored, and allocating 38 Both Holtec and the NRC Staff opposed the Motion on the procedural grounds that it was untimely filed and the relief it sought was not appropriate to be filed as a motion to dismiss. See Holtec Internationals Answer Opposing Beyond Nuclear Motion to Dismiss Licensing Proceeding for HI-STORE Consolidated Interim Storage Facility (Sept. 24, 2018) at pp.12-13; NRC Staffs Response to Motions to Dismiss Licensing Proceedings (Sept.

24, 2018) at pp. 3-6. Although Holtec continues to object to the Motion on procedural grounds, we assume that Beyond Nuclear would continue to assert the arguments that it sets forth therein.

39 Proposed Licenses and Tech Specs at 2 (ADAMS Accession No. ML17310A223) (emphasis added).

-- Red-lined excerpt from Holtec's Response to Beyond Nuclear Petition

20 legal and financial liability among the licensee and the customers; (2) include in its service contracts provisions requiring customers to provide periodically credit information, and where necessary, additional financial assurances such as guarantees, prepayment, or payment bond;

[and] (3) include in its service contracts a provision requiring the licensee not to terminate its license prior to furnishing the spent fuel storage services covered by the service contract.

Proposed Licenses and Tech Specs at 2. In addition, the note to SAR Table 1.0.2 states: in accordance with 10CFR72.22, the construction program will be undertaken only after a definitive agreement with the prospective user/payer for storing the used fuel (USDOE and/or a nuclear plant owner) at HI-STORE CIS has been established.40 And the Financial Assurance &

Project Life Cycle Report (HI-2177593 rev. 0), which is a part of the Application, states in Sec.

1.0 (at 3), [a]dditionally, as a matter of financial prudence, Holtec will require the necessary user agreements in place (from the USDOE and/or the nuclear plant owners) that will justify the required capital expenditures by the Company.41 The Motion to Dismiss cites to a few references in the Environmental Report that suggest a broader DOE role by omitting the nuclear plant owner portion of the USDOE and/or a nuclear plant owner allocation of responsibility.42 These references are inconsistent with Holtecs intent and are in the process of being revised to eliminate any confusion and make clear that the 40 Safety Analysis Report Rev. 0C at 26 (ADAMS Accession No. ML18254A413) (emphasis added).

41 Financial Assurance & Project Life Cycle Report at 3 (ADAMS Accession No. ML18058A608) (emphasis added).

42 See, e.g., Environmental Report at 1-1 (construction of facility not planned to start until after Holtec successfully enters into a contract for storage with the DOE) and Environmental Report at 3-104 (DOE would be responsible for transporting SNF from existing commercial nuclear power reactor storage facilities to the CIS Facility, both cited in Motion at 16). Although Beyond Nuclear interprets these provisions as contemplating that DOE will take title to the spent fuel, Motion at 16 n.4, the cited provisions in the ER do not support that reading.

Instead, the current provisions refer to Holtec enter[ing] into a contract for storage (which could include revised standard contracts and settlement agreements) and be[ing] responsible for transporting SNF (which could include funding through settlement agreements). Putting aside that these provisions are being revised to make completely clear that DOE taking title is not the central premise, the current language does not support Petitioners central premise argument.

21 Application is not based on DOE taking or holding title to the spent fuel which would be stored at the CISF. In any case, a contention based on an erroneous factual premise should not be admitted.

It is worth noting that Petitioners claims of current NWPA restrictions may well be superseded by Congress. Whether the NWPA only authorizes DOE to take title to spent nuclear fuel and only for a repository, legislation passed by the House of Representative on May 10, 2018 by a vote of 340-79 authorizes DOE to enter into agreements with a non-Federal entity for an interim spent fuel storage facility. H.R. 3053, Nuclear Waste Policy Amendments Act of 2018. But regardless of the status of this or other legislation, proposed License Conditions 17 and 18 discussed above, and not otherwise challenged in this contention, would provide that either DOE or a nuclear plant owner could be the customer for HI-STORE. If DOE is not authorized to be the customer, the nuclear plant owner is the default party to comply with License Conditions 17 and 18. Thus, the issue raised by the contention is ultimately irrelevant to the licensability of the HI-STORE-CIS facility.

B.

NRC Is Authorized to License the CISF Beyond Nuclear does not challenge the NRCs authority to license away-from-reactor centralized interim spent fuel storage facilities. Motion at 2. Nor could it, as the Commission and the judiciary have explicitly upheld that authority. As the Commission held in Private Fuel Storage, L.L.C. (Independent Spent Fuel Storage Installation), CLI-02-29, 56 N.R.C. 390 (2002),

We conclude that Congress, in enacting the Atomic Energy Act (AEA), gave the NRC authority to license privately owned, away-from-reactor (AFR) facilities. This same conclusion was reached by the U.S. Court of Appeals for the D. C. Circuit in Bullcreek v. Nuclear Regulatory Commission, 359 F.3d 536 (D.C. Cir. 2004). In that case, the State of Utah and others sought to review an NRC order denying a petition for rulemaking contending that NRCs rules for

17 Faskens claim that DOE will be responsible for the spent fuel that would be transported to and stored at the proposed facilities, Motion at 1, is also incorrect. The Application clearly states that either the nuclear plant owners from where the spent fuel originated or the DOE will be the customer for the HI-STORE CIS Facility. For example, proposed License Condition #17 states that the construction program will be undertaken only after a definitive agreement with the prospective user/payer for storing the used fuel (USDOE and/or a nuclear plant owner) at

[the] HI-STORE CIS has been established.54 Similarly, License Condition #18 states that

[t]he licensee [i.e., Holtec] shall: (1) include in its service contracts provisions requiring customers to retain title to the spent fuel stored, and allocating legal and financial liability among the licensee and the customers; (2) include in its service contracts provisions requiring customers to provide periodically credit information, and where necessary, additional financial assurances such as guarantees, prepayment, or payment bond; [and] (3) include in its service contracts a provision requiring the licensee not to terminate its license prior to furnishing the spent fuel storage services covered by the service contract.55 In addition, the note to SAR Table 1.0.2 states: in accordance with 10CFR72.22, the construction program will be undertaken only after a definitive agreement with the prospective user/payer for storing the used fuel (USDOE and/or a nuclear plant owner) at HI-STORE CIS has been established.56 And the Financial Assurance & Project Life Cycle Report (HI-2177593 rev. 0), which is a part of the Application, states in Sec. 1.0 (at 3), [a]dditionally, as a matter of financial prudence, Holtec will require the necessary user agreements in place (from the USDOE and/or the nuclear plant owners) that will justify the required capital expenditures by the Company.57 54 Proposed Licenses and Tech Specs at 2 (ADAMS Accession No. ML17310A223) (emphasis added).

55 Proposed Licenses and Tech Specs at 2.

56 Safety Analysis Report Rev. 0C at 26 (ADAMS Accession No. ML18254A413) (emphasis added).

57 Financial Assurance & Project Life Cycle Report at 3 (ADAMS Accession No. ML18058A608) (emphasis added).

-- Redlined excerpts from Holtec's Response to Fasken's Motion to Dismiss

18 Although Faskens pleadings make no reference to them,58 statements in the Environmental Report that suggest a broader DOE role by omitting the nuclear plant owner portion of the USDOE and/or a nuclear plant owner allocation of responsibility are inconsistent with Holtecs intent and are in the process of being revised to eliminate any confusion and make clear that the Application is not based on DOE taking or holding title to the spent fuel which would be stored at the CISF. In any case, the Environmental Report has been amended to remove these inconsistent references.59 It is also worth noting that Faskens claims of current NWPA restrictions, even though irrelevant, may well be superseded by Congress. Whether the NWPA only authorizes DOE to take title to spent nuclear fuel for a repository and not for interim storage, legislation passed by the House of Representative on May 10, 2018 by a vote of 340-79 authorizes DOE to enter into agreements with a non-Federal entity for an interim spent fuel storage facility.60 But regardless of whether this or other legislation is ultimately enacted, proposed License Conditions 17 and 18 discussed above, and not otherwise challenged in this contention, would provide that either DOE or a nuclear plant owner could be the customer for HI-STORE. If DOE is not authorized to be the customer, the nuclear plant owner is the default party to comply with License Conditions 17 and 18. Thus, the issue raised by the contention is ultimately irrelevant to the licensability of the HI-STORE-CIS facility.

58 Those statement were relied upon by Beyond Nuclear, Beyond Nuclear Motion to Dismiss at 16, and were addressed by Holtec in its Answer Opposing Beyond Nuclears Hearing Request and Petition to Intervene at 20-

21.

59 See K. Manzione (Holtec International) to J. Cuadrado (NRC), Holtec International HI-STORE CIS (Consolidated Interim Storage Facility) License Application Responses to Requests for Supplemental Information (ADAMS Accession No. 18333A041) Attachment 5: HI-2177593 HI-STORE Environmental Report Rev 3 - Non-Proprietary at 1-1, 3-104 (Not yet in ADAMS.).

60 H.R. 3053, Nuclear Waste Policy Amendments Act of 2018.

down to the assertion that if an accident occurred at the site or during transport of casks to the site, they or their property would be harmed from the radiological release.74 The members fail to provide any detailed explanation of how or why a leak at the site would actually affect them or their property and so fail to show any injury is "certainly impending" from the CISF.

Accordingly, the members' declarations are insufficient to support a claim of standing based upon injury-in-fact.

IV.

NONE OF THE SUBMITTED CONTENTIONS IS ADMISSIBLE A.

Contention 1 (NRC Authority to License HI-STORE CIS F)

Contention 1 asserts that the NRC lacks the authority under either the Atomic Energy Act

("AEA") or the Nuclear Waste Policy Act ("NWPA") to license the CISF. Pet. at 10-11.

According to Petitioner, the AEA has no provisions for the licensing of a CISF. Jd. Contention 1 also asserts that Holtec has said that DOE "must take title to" the spent fuel to be stored at the CISF, an action which (according to Petitioner) the NWPA does not authorize DOE to do. Jd.

None of these assertions has any basis and the contention should be rejected.

1.

Contrary to the Contention, the Application Is Based on the Assumption that Either DOE Or the Nuclear Plant Owner will Take Title to the Spent Fuel The Petitioner asserts that the CISF Application "assumes that the Department of Energy

('DOE') will take ownership of the spent fuel to be stored at the Holtec site." Pet. at 11. To 74 Sierra Club member Jimi Gadzia also asserts that "the added truck and rail activity from Holtec's activities" could impair the oil and gas industry's access to transportation. However, the Commission has found this type of economic harm to be outside of the scope ofNEPA and the AEA. See Quivira Mining Co. (Ambrosia Lake Facility, Grants, New Mexico), CLI-98-11, 48 N.R.C. 1,9 (1998) ("The fact that economic interest or motivation is involved will not preclude standing, but the petitioner must also be threatened by environmental harm."); see also Int'l Uranium (USA) Corp. (Receipt of Material from Tonawanda, New York), CLI-98-23, 48 N.R.C. 259, 265 (1998) ("[I]t has long been our practice as an agency to reject standing for petitioners asserting a bare economic injury, unlinked to any radiological harm."); Quivara Mining Co., CLI-98-11, 48 N.R.C. at 11 (fmding "no indication in the AEA of an intent to protect... a purely economic interest entirely unrelated to any radiological harm"); Sacramento Mun.1 Util. Dist. (Rancho Seco Nuclear Generating Station), CLI-92-2, 35 N.R.C. 47, 56 (1992) ("It is true that NEPA does protect some economic interests; however, it only protects against those injuries that result from environmental damage.").

17 -- Red-lined excerpt from Holtec's Response to Sierra Club Petition

support this assertion, the Contention ignores or misconstrues provisions in the Application that make clear that title and ownership of the spent fuel to be stored at the CISF will be held either by DOE or the nuclear plant owner. The Application clearly states that either the nuclear plant owners from where the spent fuel originated or the DOE will be the customer for the HI-STORE CIS Facility. For example, proposed License Condition #17 states that "the construction program will be undertaken only after a definitive agreement with the prospective user/payer for storing the used fuel (USDOE and/or a nuclear plant owner) at the HI-STORE CIS has been established." Proposed License for Independent Storage of Spent Nuclear Fuel at 2 (ADAMS Accession No. MLl73 IOA223) (emphasis added). Similarly, License Condition #18 states that

"[tJhe licensee [i.e., HoltecJ shall: (1) include in its service contracts provisions requiring customers to retain title to the spent fuel stored, and allocating legal and financial liability among the licensee and the customers; (2) include in its service contracts provisions requiring customers to provide periodically credit information, and where necessary, additional financial assurances such as guarantees, prepayment, or payment bond; and (3) include in its service contracts a provision requiring the licensee not to terminate its license prior to furnishing the spent fuel storage services covered by the service contract." Id. In addition, the note to SAR Table 1.0.2 states: "in accordance with 1 OCFR 72.22, the construction program will be undertaken only after a definitive agreement with the prospective user/payer for storing the used fuel (USDOE and/or a nuclear plant owner) at HI-STORE CIS has been established." SAR at 26 (ADAMS Accession No. MLl8254A413) (emphasis added). And the Financial Assurance & Project Life Cycle Report (HI-2177593 rev. 0), which is a part of the Application, states in Sec. 1.0 at PDF page 3), "[aJdditionally, as a matter of financial prudence, Holtec will require the necessary user agreements in place (from the USDOE and/or the nuclear plant owners) that wi ll justifY the 18

required capital expenditures by the Company." Financial Assurance & Project Life Cycle Report at PDF page 3 (ADAMS Accession No. ML18058A608) (emphasis added)75 The Contention cites to a reference in the Environmental Report that suggest a broader DOE role by omitting the nuclear plant owner portion of the "USDOE and/or a nuclear plant owner" allocation of responsibility. 76 These references are inconsistent with the provisions discussed above and are in the process of being revised to eliminate any confusion and make clear that the Application is based on DOE and/or the nuclear plant owner taking or holding title to the spent fuel which would be stored at the CISF. In any case, a contention based on an erroneous factual premise should not be admitted.

The Contention also cites to several public statements which Petitioner asserts "show[]

Holtec's intention that DOE must take title to the radioactive waste before Holtec will begin to construct the proposed CIS facility." Pet. at 12. It should first be noted that each of the statements cited by the Contention predate that Application. Second, none of the statements talk about a Holtec requirement that DOE take title for the project to go forward. For example, the 2015 SpentFuel article summarized a Holtec statement that a contract with DOE including its taking title was "Holtec's vision," id. and Pet. Ex. 1; the 2016 PowerPoint presentation says the project "requires federal funding,"77 which could occur the same way the on-site ISFSI's are typically funded, i.e., by DOE settlement payments or final judgments to the utilities from their 75 Interestingly, the Petition cites this very language as support for its "DOE only" argwnent, ignoring without explaining its failure to recognize the "andlor nuclear plant owner" language.

76 See. e.g., ER at 1-I (construction of facility not planned to start until "after Holtec successfully enters into a contract for storage with the" DOE). Petition at 11 ("The application submitted by Holtec assumes that the Department of Energy (DOE) will take ownership of the spent fuel to be stored at the Holtec site. ER at 1.0.").

This provision does not support the Contention. Instead, this provision refers to Holtec "enter[ing] into a contract for storage" (which could include revised standard contracts and settlement agreements).

77 Pet. at I 2 and Ex. 2.

19

breach of contract lawsuits against the Government; 78 the 2015 World Nuclear News article that Holtec "will (] soon have official talks with [the DOE] on a contract whereby the DOE will hold title to the fuel," Pet. at 12, and Ex. 3; and finally the Land Purchase Option Agreement between Holtec and the Eddy-Lea Energy Alliance, which explicitly refers to "successful completion of an agreement with the Department of Energy and/or one or more utility companies... " Pet. at 13 and Ex. 4.

As demonstrated, the Contention's assumption that DOE taking title is central to the CISF Application is in error.

2.

The Commission has the Authority to License the CISF The Contention claims that the AEA does not have any provisions for licensing a storage facility and that the "AEA's licensing section, 42 U.S.c. § 2133" only authorizes the licensing of utilization and production facilities79 This assertion is demonstrably incorrect. The AEA includes licensing sections besides 42 U.S.c. § 2133, for example, 42 U.S.C. § 2141. As the Commission held in Private Fuel Storage, L.L. C. (Independent Spent Fuel Storage Installation),

CLI-02-29, 56 N.R.C. 390 (2002), "Congress, in enacting the Atomic Energy Act (AEA), gave the NRC authority to license privately owned, away-from-reactor (AFR) facilities." Tills same conclusion was reached by the U.S. Court of Appeals for the D. C. Circuit in Bullcreek v.

Nuclear Regulatory Commission, 359 F.3d 536 (D.C. Cir. 2004). In that case, the State of Utah and others sought to review an NRC order denying a petition for rulemaking contending that 78 As of September 30, 2017, utilities have been paid $4.9 billion by the Government in settlement of their breach of contract lawsuits for their additional spent fuel storage costs caused by the Government's breach of the Government's obligation to have begun accepting the utilities' spent fuel by 1998. The Government has paid an additional $2.0 billion to utilities in final judgments in the breach of contract lawsuits. See DOE Office of Inspector General, DOE-OIG-18-34, Audit Report at 22-24 n.9 (May 2018).

79 While the Petition at length argues that the ClSF cannot be licensed because it is neither a "production" nor a "utilization" facility, Pet. at 16-17, those facilities do not define the boundaries of NRC's licensing authority.

20

28 Although these procedures also state that requests submitted later than 10 days after publication of the Federal Register notice will not be considered absent a showing of good cause for the late filing - a deadline which has passed - I will, pursuant to my authority under 10 C.F.R. § 2.307(c), consider any such requests filed within 10 days of the issuance of this order.109 Despite the Commissions instructions regarding how the Petitioners should obtain Appendix C, and despite the deadline extension, the Petitioners made no effort to follow those procedures.

Yet, they now challenge the Application on the basis that the redacted information is unavailable.

There simply is no justification for admitting Petitioners claim that the NRCs redaction of Appendix C violated the NHPA or NEPA because it was not available to the public.

Petitioners were notified of their opportunity to obtain Appendix C twice - first in the July 16 Federal Register notice and then in the Commissions August 20, 2018 Order. The Commission even provided Petitioners with an additional 10 days to make such a request. Far from it being impossible to challenge the information in Appendix C, Petitioners (and any member of the public) could have obtained that information over the 45-day period between the July 16, 2018 Federal Register notice and the August 30 extended deadline, if they had followed the procedure set out by the Commission. But they never even tried.

For these reasons, the Commission should reject Contention 1 because it fails to raise a genuine dispute with Holtecs Application on a material issue of fact or law, as is required under 10 C.F.R. § 2.309(f)(vi).

B.

Contention 2 (Insufficient Assurances of Financing).

According to Contention 2, Holtec cannot provide reasonable assurances that it can obtain the necessary funds to cover the costs of construction, operation maintenance and decommissioning of the CISF.110 Contention 2 is based on Petitioners misinterpretation of the 109 Id. at 3.

110 Pet. at 31. -- Redlined exercepts from Holtec's Response to Don't Waste Michigan, et al.

29 information Holtec provided in its Application to demonstrate its financial qualifications in accordance with NRC regulations. Petitioners also fail to challenge the information that Holtec provided to make that demonstration. For these reasons, Contention 2 is inadmissible because it fails to raise a genuine dispute with the Application on a material issue of fact and law, and fails to provide supporting facts.

The crux of Contention 2 is Petitioners claim that Holtec will not construct the CISF without financial guarantees from the U.S. Department of Energy.111 As the Application makes clear, this is not true. The Application includes a document titled: Holtec International & Eddy Lea Energy Allliance (ELEA) Underground CIS - Financial Assurance & Project Life Cycle Cost Estimates (Financial Assurance Plan), which sets forth Holtecs financial qualifications to construct, operate, and decommission the plant as required under 10 C.F.R. § 72.22(e). The Financial Assurance Plan nowhere states that the CISF requires financial guarantees or other support from the DOE. Rather, the Plan says in numerous places that the CISF will be funded by Holtecs internal resources.

For example, Section 1.0 of the Financial Assurance Plan states: The HI-STORE CIS in New Mexico, the subject of this report, is also funded by Holtec in its entirety.112 Section 1.0 points out that Holtec operates its business with a long-term view, and that [t]he proof of long term commitment can be found in the Consolidated Interim Storage Facility in New Mexico (the focus of this report) and the SMR-160 reactor development program... which are both being funded entirely by the Company.113 111 Id. at 32.

112 Financial Assurance Plan at 2.

113 Id. at 3 (emphasis in original).

30 The Financial Assurance Plan includes a Table 1.1, which contains proprietary information demonstrating that Holtec has the financial wherewithal to fund the project.114 The Financial Assurance Plan also describes Holtecs financial strength generally, such as profitable in every year of operation since the Companys inception over 30 years ago; no long term debt; a history of funding large projects without any long term borrowing; a robust multi-billion dollar backlog of work; a (l)arge and diversified customer base; and 140+ contracts active at this time, most of which are large contracts giving the Company a predictable stable cash flow.115 The Plan also references Holtecs senior credit facility without any collateral requirement, which can be increased if needed.116 The Financial Assurance Plan adds:

As can be inferred from the above narrative, Holtec International is well positioned to provide the financial assurance for the construction and oversight of Phase 1117 of the CISF facility to include 500 HI-STORM UMAX canisters for the Storage of Spent Nuclear Fuel (SNF) and Greater-than-Class C (GTCC) waste from commercial reactors. Our commitment is based on the willingness and capability of Holtec to fund the construction efforts of the CISF estimated to be in the range of $180 million.

The Plan also states that the NRCs financial qualifications requirement regarding decommissioning will be met by Holtec International. Specifically,

[a] decommissioning fund will be established by setting aside $840 per MTU stored at the HI-STORE facility. These funds, plus earnings on such funds calculated at not greater than a 3 percent real rate of return over the 40-year license life of the facility, will cover the estimated cost to complete decommissioning.118 Petitioners have not challenged any of this information. Accordingly, Contention 2 fails to raise a genuine dispute with the Application and is not adequately supported.

114 Id. at 4.

115 Id. at 2.

116 Id.

117 The Application seeks an initial authorization for 500 canisters of spent nuclear fuel for a 40-year license duration. See, e.g., Application, Cover Letter at 1.

118 Financial Assurance Plan at 5.

31 Instead of challenging the information described above, Contention 2 repeatedly and incorrectly claims that Holtec is relying on contracts with DOE to show that it is financially qualified to construct, operate, and decommission the CISF. To support their argument, Petitioners first rely on the following language in the Financial Assurance Plan:

Additionally, as a matter of financial prudence, Holtec will require the necessary user agreements in place (from the USDOE and/or the nuclear plant owners) that will justify the required capital expenditures by the Company. However, if the NRC approves and the necessary contractual instruments are established insuring the minimum revenue stream needed to justify the facility, then Holtec will launch the construction using its own resources so as to bring the interim storage solution to the industry in the shortest possible time.119 Nothing in this statement supports Petitioners claim that Holtec is relying on DOE contracts to demonstrate its financial qualifications.

This paragraph states that Holtec - as would any good business - will ensure that it has customer contracts in place to generate revenues before Holtec makes the required capital expenditures. As Holtec states, ensuring that the company can earn revenues before investing in a project is a matter of financial prudence, not a statement that a contract with DOE is needed to fund it. Indeed, this paragraph expressly states that expenditures will be made by the Company using its own resources. Moreover, the user agreements to which Holtec refers shall be from the USDOE and/or the nuclear plant owners. Use of the term and/or makes it clear that, contrary to Petitioners claims in Contention 2, Holtec is not relying on DOE contracts to demonstrate its financial qualifications.

Applying their incorrect premise, Petitioners then claim that current law does not authorize the proposed method of financing enumerated in [Holtecs] Financial Assurance 119 Pet. at 32 (emphasis added).

32 Plan.120 According to Petitioners, [t]here is no legal authority under the Nuclear Waste Policy Act of 1983, as amended, for DOE to enter into any agreement... to pay for such centralized interim storage facility construction, operations, maintenance, decommissioning, etc.121 Petitioners add that the Nuclear Waste Policy Act provides zero financial support to private away-from-reactor storage schemes unless there is an operating repository, and that the NWPA does not contemplate a financial arrangement whereby DOE takes title to spent nuclear fuel for purposes of interim storage....122 Summarizing their position, Petitioners argue that Holtec has not provided the requisite financial assurance because Holtecs financing plan is dependent upon an arrangement that is not disclosed within Holtecs narrative explanation and which does not appear to be authorized by the NWPA.123 The Commission should reject these arguments. They are all based on Petitioners incorrect conclusion that Holtecs financial qualification demonstration is dependent upon contracts under which DOE takes title to spent nuclear fuel for interim storage. As shown above, the Application makes it clear that the projects financing will be provided from the Companys resources and is not dependent on DOE contracts. Accordingly, Petitioners arguments regarding whether the NWPA authorizes DOE to enter into agreements to take title to spent nuclear fuel for purposes of interim storage are irrelevant to whether Holtec has demonstrated its financial qualifications.

Contention 2 also relies on the following statement in Holtecs Financial Assurance Plan:

2.1 Annual Operating Costs. Anticipated operating costs for the HI-STORE facility are $10 120 Id. at 35.

121 Id. at 33.

122 Id. at 35.

123 Id.

33 million annually. All financial commitments related to annual operations will be tied to the sponsoring partys agreement with Holtec (viz., DOE settlement agreement).124 According to Petitioners, this paragraph shows that Holtec considers DOE to be the sponsoring party of the CISF, and the term DOE settlement agreements apparently refers to agreements whereby DOE takes title to the spent fuel at nuclear reactor sites.125 Petitioners misunderstand the meaning of this paragraph. Nothing in the Financial Assurance Plan - or in any part of the Application -

indicates that Holtec considers DOE to be the CISFs sponsoring party. Given that the paragraph references a DOE settlement agreement, it is clear that sponsoring party refers to potential Holtec customers who have negotiated settlement agreements with the DOE for their breach of contract lawsuits against DOE. Since 1998, nuclear utilities have brought these lawsuits to recover damages incurred by the utilities as a result of the DOEs failure to begin accepting the utilities spent nuclear fuel by the 1998 deadline established by the Nuclear Waste Policy and the Standard Contract.126 The DOE settlement agreement obviously refers to the settlements arising out of those lawsuits,127 not a future agreement between DOE and Holtec under which DOE would take title to spent fuel for interim storage. There may well be such contracts between DOE and Holtec should pending legislation be enacted.128 However, such a 124 Id. at 33 (citing Financial Assurance Plan at 6).

125 Id. at 33.

126 See, e.g., Northern States Power Co. v. United States, 224 F.3d 1361 (Fed. Cir. 2000); Maine Yankee Atomic Power Co. United States, 225 F.3d 1336 (Fed. Cir. 2000); Indiana Michigan Power Co. v. United States, 422 F.3d 1369 (Fed. Cir. 2005).

127 As of September 2017, the DOE and nuclear utilities have settled 39 lawsuits involving the DOEs breach of contract. As of September 2017, the Government has paid $4.9 billion to the settling utilities in delay damages.

An additional $2.0 billion has been paid to utilities that litigated to final judgment their breach of contract cases.

The DOE estimates its remaining liabilities for its breach of contract to be $27.3 billion. An earlier industry estimate of the utilities damages was for an estimated $50 billion. DOE Office of Inspector General, Audit Report, DOE OIG-018-34 (May 2018) at 23-24.

128 H.R, 3053, which was passed by the U.S. House of Representatives and is currently pending before the Senate, would authorize DOE to enter into contracts with private, away from reactor, spent fuel storage installations.

34 possible contract is not referenced in the Application nor relied on by Holtec for the projects financial qualifications.

Petitioners next cite the following statement in Paragraph 17 of the Applications draft NRC license:

In accordance with 10 CFR 72.22, the construction program will be undertaken only after a definitive agreement with the prospective user/payer for storing the used fuel (USDOE and/or a nuclear plant owner) at HI-STORE CIS has been established. Construction of any additional capacity beyond this initial capacity amount shall commence only after funding is fully committed that is adequate to construct such additional capacity.129 This statement does not support Contention 2. It says that prospective users/payers for spent fuel storage at the CIS would be USDOE and/or a nuclear plant owner. Moreover, it is appropriate for NRC license applicants such as Holtec to rely on license conditions as a basis for demonstrating reasonable financial assurance under 10 C.F.R. § 72.22(e).130 Petitioners also cite three quotations from Holtec personnel.131 The quotations upon which Petitioners rely from Spent Fuel and World Nuclear News are from 2015, predating the Application which was submitted in 2017. Those statements discuss Holtecs vision for the project, and how Holtec would be discussing with DOE whether DOE will hold title to the fuel.132 Nothing in these statements indicate that Holtec relied (then or now) on a contract with DOE to satisfy the NRCs financial qualifications requirement. Nor do those quotes contradict statements in the Financial Assurance Plan that Holtec will fund the plant from its own 129 Pet. at 33.

130 Private Fuel Storage, L.L.C. (Independent Spent Fuel Storage Installation), LBP-00-6, 51 N.R.C. 101, 113-117 (2000), affd in part, Private Fuel Storage, L.L.C (Independent Spent Fuel Storage Installation), CLI-0-08, 61 N.R.C. 129 (2005); Louisiana Energy Services, L.P. (Claiborne Enrichment Center), CLI-97-15, 46 N.R.C.294, 302 (1997).

131 Pet. at 34.

132 Id.

35 resources, and that Holtec will enter into customer contracts with DOE and/or nuclear plant owners. At most, they show that Holtec would be pursuing DOE as a customer.133 Finally, Petitioners quote from a January 2016 presentation, which included one bullet point on a slide which stated that Holtec [r]equires federal funding to construct and operate the CISF.134 That presentation was given in January of 2016 - more than a year before Holtec submitted its Application to the NRC. As the Financial Assurance Plan states, Holtec will fund the project from its own resources and plans to enter into customer contracts with DOE and/or nuclear plant owners. Petitioners have provided no basis to disregard the statements in the Application in favor of a bullet in a slide presentation given more than a year before the Application was filed.

For these reasons, the Commission should reject Contention 2 because it fails to allege facts challenging Holtecs demonstration of its financial qualifications, and fails to raise a material dispute with the Application. See 10 C.F.R. § 2.309(f)(v) and (vi).

C.

Contention 3 (Low-Level Radioactive Waste).

Contention 3, which alleges that the Environmental Report for the CISF (ER) underestimates the environmental impacts of low-level radioactive waste (LLRW) that will be generated by the facility (Pet. at 36), impermissibly challenges the Commissions Continued Storage Rule set forth in 10 C.F.R. § 51.23 (the Continued Storage Rule or Rule).

Petitioners have not sought a waiver of the Rule, nor demonstrated by affidavit (or otherwise) that special circumstances exist such that the application of the rule or regulation (or a provision of it) would not serve the purposes for which the rule or regulation was adopted in 133 To the extent other petitioners in this proceeding claim that certain statements in the Application suggest that Holtec must enter into contracts with DOE for the CISF to go forward, Holtec is in the process of amending the Application to clarify that contracts for SNF storage will be between DOE and/or nuclear plant owners.

134 Pet. at 34.