ML19250B940
| ML19250B940 | |
| Person / Time | |
|---|---|
| Site: | Comanche Peak  |
| Issue date: | 09/12/1979 |
| From: | Saltzman J Office of Nuclear Reactor Regulation |
| To: | Hart G SENATE, ENVIRONMENT & PUBLIC WORKS |
| References | |
| NUDOCS 7911060230 | |
| Download: ML19250B940 (1) | |
Text
-
. gpr-1
'q e
f.,
~
=
.~
SEP 1 r1979 :
3
' ' Distribution-
~
OCA (3)
DocketFileQ g
,, - ~
NRR Reading h.
h-M.
AIG Reading I
Docket Nos 50-445A4 a JRutberg, OELD.
c
.s
.BVogler,.0 ELD t-
^:50-446A
~
..JSaltzman Reading
~
-e AIG Files
~
The Honorab' Gary Hart, Chairman.
h Subconnittee on Nuclear Regulation '
~
qr.
u Comittee on Environment a.nd Public Works',,.
- r.;
<m_
T 1 nited States Senate ',
... s
=
' - Washington, DC'.2051Q' ' -
..q d L.,
~ m
- - G+ N- ' L-: y.',
~
s.
,?
~
~
4:., ' FZ., %.x '7.. -< T 0:. '. ' ~. <.
Dear ~Mr.,
Chairman:2
- --V U
~
<~..f.
. 5.c..,..'s-c4
.4
't..
,u,..
x 7..
2 -
.s
~
1This is to infonn 'he:Sdbcomittee on Nuclear Regulation that the Counission c
.has received additfonal-antitrus t advice from. the Attorney General in connection sith Texas Utilities; Generating Company's operating license' applicatior, for Comanche Peak Steam _ Pectric Station, Units No. _1 and.
, ~ No. ' 2.
This advic is rendered pursuant to'section 10Sc of;the Atomic i
t Energy. Act,of:1954,.as amendedd R' -
' f '.f.
' >., z:,. -
. y.,. 3,y p ;.
3-
~.
~~
A copy of the. Attorney General %1etter dated September 5,21979, ;is--
c -~~
enclosed.. In his -lettershe concludes:
- 3. _ #';
. 7m w, r :- o., #
..'7
-p+
s "In light of'the attached letter referenced above, where-f by'the members of 111PA have agreed to be bound by the outcome
.of the present Comanche Peak antitrust. antitrust hearing, the
-Department believes'.that'an antitrust hearing on.the application of TMPA-to participate in the Comanche Peak units is not
~
nH-E
,>. ~. -
.. necessary. ' y
- y.y p
g7.~
. Sincerely,7.
r
- 9 D""}DAbom Mm_1$}f D"T
. N%ESALTZMkN s.
d i
(
J D
e
.s
- Jero6e ~Saltzman,' Chief _
s.
77, ' *: --p>Tf t:..
.' ^
-.....Q
, yg:#:7. A 7,y._.y l Antitrust and Indemnity Group r
j
; ' z.
0ffice of Nuclear Reactor Regulation i
. /,9,. ~.,
,2 v..
... ~
Enclosure':
Attorney General's Letter' cc: Sen. Alan Simpso.n-1276 01,.3
.&v.
[]
79110R0 s
..,7..g,.V,./.....-
.N A
OEL g
.3.g.., g....,
p m...........
~>
.... 7/..
.. 9..... ~9/S/79 9/h/79
.....h.....................
macreau m o.m E um
Qg Einiteb States Ecpartment Of 3Tu5tice ggp WASmNGTON, D.C. 20530 W
AS33$ TANT ATTOmsety cgmanAL aseTITaus? OlviSK3e SEP 5 1975 Boward K. Shapar, Esquire Executive Legal Director Nuclear Regulatory Commission Washington, D. C.
20555 Re:
Texas Utilities Generating Company, Comanche Peak Steam Electric Station, Units 1 and 2, NRC Docket Nos. 50-445A and 50-446A
Dear Mr. Shapar:
You have requested our further advice pursuant to Sec-tion 105c of the Atomic Energy Act of 1954, as amended, with regard to the participation by ti.) Texas Municipal Power Agency -(TMPA) in thL Comanche Peak Steam Electric Station, Units 1 and 2, NRC Docket Nos. 50-445A and 50-446A.
The Comanche Peak Steam Electric ctation will consist of two units, each rated at 1150 megawatts.
The station is being built and will be operated by Texas Utilities Generat-ing Company (TUGCO), a subsidiary of Texas Utilities Company (TU). 1/ By the terms of the agreement between TUGCO and TMPA, TMPA will secure a 6.2 percent ownership interest, or 72 MW in each unit.
TMPA is an agency established in 1975 pursuant to Texas law, and it consists of four Texas municipalities engaged in the generation, transmission, and distribution of electric power.
TMPA was formed so that municipal systems with elec-tric generation in Texas could join together to build new generation and to use their existing generation more effec-tively.
The prasent members of TMPA are the Citjes of Bryan, Denton, Garland and Greenville.
l/ The designation "TU" comprises the Texas Utilities company and its various operating and. service subsidiary companies including Dallas Power and Light Company, Texas Electric Service Company, and Texas Power and Light Company, each of of which is a joint owner of the Texas Utilities Generating Company (TUGCO).
3 6 016 OS
[S@8M 9 9 o ye j 7 s
bylettertoyoudatedAugust1, 1978, the Departn.ent advised the Nuclear Regulatory Commission (NRC) that an antitrust hearing would be necessary in reference to the operating license application of TUGCO.
That antitrust hearing, currently in the final stages of discovery, is scheduled to begin in February of 1980.
The basis for the Department's reco;mendation that an antitrust hearing be conducted on the Comanche Peak operating license was that TU had combined with other utilities in Texas and agreed to disconnect from any other electrical utility that commenced operation in interstate commerce.
In light of TU's dominant position in Texas, the fact that it had disccr.nected frem other electric utilities in 1976 when those uttiities went into interstate commerce, and in view of changed circum-stances in the electric utility markets in Texas, as set forth in my letter to you dated February 21, 1978, regarding the South Texas Froject, NRC Docket Nos. 50-498A and 50-499A, the Department concluded that an antitrust hearing was necessary.
Between 1976 and 1978 TMPA, entered into two agreements with Texas Power and Light Company (TP&L), a TU subsidiary, whereby TP&L agreed to supply ready economy energy and in-terruptible off-pr*k economy energy to TMPA.
On January 2, 1979, TMPA enterec into two additional contracts with TU subsidiaries:
the Comanche Peak Ownership Agreement and a transmission agreement.
All of the foregoing contractual agreements contain restrictions which, in effect, foreclose TMPA from interconecting with and engaging in the buying and selling of power or energy with electric utilities that operate in interstate commerce.
It is TU's ' intrastate only" policy and practice which is the subject of the pres-ent Comanche Peak antitrust hearing.
Resolution of the antitrust issues in that hearing will necessarily resolve any antitrust questions raised by these restrictions in the contractual agreements between TMPA and TU subsidiaries.
TMPA has agreed to be bound by the outcome of the present Comanche Peak antitrust hearing, including the resolution of the intrastate only restrictions in its contracts with TU subsidiaries (See attached letter).
Our investigation of TMPA's application to participate in the Comanche Peak Steam Electric Station did, however, uncover the existence cf an agreement entered into in 1973 between the City of Garland (Garland) and TP&L.
This agree-ment effected a territorial division of retail marketing areas within Garland, a market jointly served by Garland and TP&L.
In 1978 the Texas Public Utilities Commission jointly certified this market area to Garland and TP&L. 1276 017 d
This agreement continues to operate a t the present time, and, in fact, an exchange of some of tne c11ccated marketing areas between Garland and TP&L cccurred in 1977.
The Department believes that a purely local agreement between a municipality and an investor-owne? electrical util-ity operating under a franchise gra.ited by the municipality to divide retail marketing areas within the municipality's limits and which oes not bear a significant relationship to competition in the generation or transmission of electric power at the wholesale level ordinatily does not form the basis for initiating an antitrust hearing under Section 105c.
This is not to say, however, that such agreements should not be scrutinized by the NRC where relevant to other antitrust concerns.
It is the Department's belief that the antitrust consequences, if any, stemming from such purely local agreements on the retail level would be more appropri-ately dealt with by state utility commissions or under state or federal antitrust legislation than by the NRC.
- Indeed, the Depar tment is examining this agreement to determine whether further action ~is appropriate under the federal antitrust laws.
In light of the attached letter referenced above, where-by the members of TMPA have agreed to be bound by the outcome of the present Comanche Peak antitrust hearing, the Depart-ment believes that an antitrust hearing on the application of TMPA to participate in the Comanche Peak units is not necessary.
Sn rely rs, A $22A a J
n H.
Shenefield Ass ant Attorney General Antitrust Division Enclosure 1276 018 e
(. "(~R Ti? SiE W 6RiF 77 73 8:iri
' si,nng the cities of Bryan. Denton. Garland & Greenvdie.
August 29, 1979 United States Department of Justice P. O. Box.14141 Washington, D.C.
20044 Attention:
Mr. Rc bert Fabrikant, Assistant Section Chief Energ/ Section, Antitrust Division Re: Texas Municipal Power Agency Application for Amendment of Cocanche Peak Steam Electric Station Construction Permits Centlemen:
The Texas Municipal Power Agency (TMPA) is a signatory to contracts with subsidiaries of the Texas Utilities Company that contain langu ige which the Deyrtment of Justice has construed as preventing or limiting TMPA from operating in, or interconnecting with other electric utilities that are operating in, interstate co=merce.
In order to avoid the necessity of an antitrust hearing on TMPA's participation in the Comanche Peak Steam Electr!c Station, NRC docket nuLbers 50-445A and 50-446A, IMPA makes the following representations:
(1) While TMPA is a party to contracts that contain intrastate only provisions, TMPA did not request that such provisions be included in the contract.s and would not object to stch provisions being deleted from the contracts or enjcMJ, should such deletion be ordered or an injunction be issued in an administrative or judicial proceeding or be agreed to by the other signatories to the contracts.
(2) TMPA agrees to be bound by the outcome of the present operating.
license antitrust proceedings involving the Comanche Peak Steae Electric Station including any conditions that are attached to the operating license as a result of t.at proceeding.
b Very truly yours, TEXAS MUNICIPAL POWER AGENCY i,
yc.
Jdel T. Rodgers General Manager JTR/dd
\\276.D\\9 J. Rodney Lee cc:
T= astbk8 eJPaucs A ctm)
GOC an ngton Downs Tower Anagton. Tenas 76011 (S171451-4 0 3 p
9
_