ML19250C403

Responds to Requesting Withdrawal of Federal Funds Used to Purchase 17% of Facility.Clarifies Concerns Re Apparent Discrepancies Between Des at CP Stage & ASLB Initial Decision

ML19250C403
Person / Time
Site:	Marble Hill
Issue date:	11/07/1979
From:	Harold Denton Office of Nuclear Reactor Regulation
To:	Schroeder R AFFILIATION NOT ASSIGNED
Shared Package
ML19250C404	List: ML19250C403 ML19250C406
References
NUDOCS 7911230359
Download: ML19250C403 (3)

Text

'

tr

'g UM14 0 ST A T Es b,,7(

NUCLEAR dEGUL A T ORY LOMillSSluN 7, x.

y

v. Asse.ci os. o. c. 2czs S

w e

gw.....f NOV 7 1979 Ms. Rosella Schroeder Skyline Drive, Route No. 3 Box 190

~Dl

_ 3 Floyds Knobs, Indiana 47119

, g J,

Dear Ms. Schroeder:

Your August 10, 1979 letter, requesting that federal funds used to purchase 17% of the Marble Hill Nuclear Power Plant be withdrawn, was directed to the Nuclear Regulatory Commission (NRC).

Your specific request that the government initiate a review of the Rural Electrification Administration (REA) loan corr.mitment to the Wabash Valley Power Authority (UVPA) has been transmitted to the REA for response since such a review is beyond the purview of NRC. The NRC has, however, reviewed your letter; and we believe we can clarify some of your concerns regarding apparent discrepancies between the NRC's Draft Environmental Statement - Construction Permit Stage (DES-CP) for Marble Hill and the Initial Decision of the Atomic Safety and Licensing Board, as well as the present status of construction activities at the Marble Hill project.

With respect to the discrepancies, it is important to stress chat much of the information is subject to modification with time.

For example, load projections, capacity plans, cost estimates, and scheduled operating dates are continually being revised as utilities adjust to the dynamic forces inherent in long range generation expansion planning.

Partially because of these considerations, the NRC's construction permit review is performed in stages wherein analyses are updated and revised throughout the process.

For example, in addition to the DES-CP, the NRC is required to prepare a Final Environmental Statement (FES) and usually prepares Supplemental Testimony for a required hearing by the Atomic ~ Safety and Licensing Board prior to the decision on a Construction Pemit.

With respect to the Marble Hill application, you note that the proposed ownership of Marble Hill has changed since the issuance of the DES-CP in March 1976, and consequently the staff.'s need for power analysis is suspect.

Clearly, at the time the DES was prepared, four relatively small power authorities were to control 15% of the Marble Hill plant; whereas, now it is envisioned that just one, the WVPA, will control approximately 17%. The ownership isssue has evolved throughout the NRC's 30 month construction permit review and has been accounted for in the NRC's final assessment. For example, in the Marble Hill FES-CP of Septmber 1976, two of the smaller power authorities were already identified by NRC as having dropped out and WVPA was credited with 7% ownership in the proposed plant.

Furthemore, as noted in your letter, the Atomic Safety and Licensing Board issued its Initial Decision recommending issuance of a Construction Permit in April 1978 with full knowledge that WVPA would control 17% of the plant.

Clearly, this change was aired at the CP hearing and was a matter of record to all parties involved. Finally, the staff's need for power assessment never relied on the specific power supply requirements of WVPA or 1389 ]31 7911230

Ms. Rosella Schroeder '

the three small participants, but rather, based its assessment on the needs of Public Service Company of Indiana (PSI), Northern Indiana Public Service Company (NIPSCO), and the East Central Area Reliability Council (ECAR).

Since all previously identified participants and existing participants are members of ECAR, the ECAR analysis would not be effected by internal shifts in ownership of capacity and the need for power analysis was in no way encumbered by this change.

Another area of concern centers on the projected construction cost of the Marble Hill units.

You indicate that the NRC's DES-CP estimated the construction cost at $1.355 billion whereas based on the cost of a 17% share to WVPA reported in April 1978, the total cost of the project would be $2.12 billion.

The DES-CP estimate of $1.355 billion is the staff's independent value based on the use of a generic computer code (CONCEPT) and is only used by the NRC as a rough check on the applicant's estimate, and in our independent assessment of the economics of coal vs. nuclear. The principal reasons for our estimate being low was that it relied on an outdated version of the CONCEPT code which was in the process of being revised. Further, the applicant's estimate. included costs associated with the loading of the first core and construction costs associated with trans-mission and distribution facilities whereas the staff's estimate did not.

In subsequent cost analyses by the staff, data inputs were updated when the new version of CONCEPT was available. As a result, the staff's cost estimate in the FES-CP was $1.708 billion, and it was estimated at $2.042 billion in the staff's Supple-mental Testimony.

The latter figure was the NRC's official estimate used by the Atomic Safety and Licensing Board in its decision to grant a construction permit. This estimate was in very close agreement to the applicant's own estimate of cost.

With respect to your concerns regarding faulty concrete work and related criticisms of construction practices at the site, the NRC acknowledges the problems.

These issues have been under investigation by the NRC's Office of Inspection and Enforcement (I&E) for the last several months.

work order on August 7,1979, for all safety-related constuction.The licensee (PSI) issued a sto This was confirmed on August 15, 1979, when V. Stello, Director, I&E, issued an order suspending construction of safety-related activities at Marble Hill.

A copy of that Order is enclosed.

As indicated in Section IV of the Order, the licensee will not rest = safety-related construction activities on the Marble Hill Units 1 and 2 nuclear power station until such time as (1) the licensee submits in writing under oath to the Director, I&E, a description of its revised quality assurance program and the steps taken 1389 132

Ms. Rosella Schroeder NOV 7 1979 to assure that safety-related construction will be conducted in accordance with Appendix B of 10 CF.R 50 of the Commission's regulations and (2) the Director has confirmed in writing that reasonable assurance exists that safety-related construction activities will be conducted in accordance with such requirements.

I trust this information has been responsive to your concerns about Marble Hill that are within the purview of the NRC.

Sincerely,

/

Y Harold R. Denton, Director Office of Nuclear Reactor Regulation

Enclosure:

Order Confirming Suspension of Construction dtd 8/15/79 signed by V. Stello cc: Mr. Robert W. Feragen, Administrator Rural Ele'trification Administration Department of Agriculture 1389 133

~

.A ENCLOSURE UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION In the Matter of l

PUBLIC SERVICE COMPANY OF INDIANk Docket Nos. 50-546 (MarAle Hill Nuclear Generating 50-547 Station, Units 1 and 2)

ORDER CONFIRMING SUSPENSION OF CONSTRUCTION The Public Service Company of Indiana (PSI or licensee) is the holder of Construction Pennits, Nos. CPPR-170 and CPPR-171, issued on April 4,1978.

These permits authorize in accordance with their provisions construction of the Marble Hill Nuclear Generating Station, Units 1 and 2.

Over the past few months, serious. problems have been identified at the Marble Hill facility con-cerning the adequacy of the licensee's quality assurance program and, in car icular, the adequai:y of concrete placement which requires escalated enforcement action.

II As a result of an inspection conducted on April 3-6, 1979, a Notice of Violation was issued to the licensee on May 4, 1979. One item in the Notice identified noncompliance with Criterion X of Appendix B to 10 CFR Part 50 related to poor control of the quality of co.ncrete placement activities at the site.

During another inspection conducted on April 30 through May 3, 1979, additional items of noncomoliance were identified. Another Notice of Violation was issued on May 29, 1979, which included an additional citation against Criterien X related to inadecuate contr activities as well as a citation agains DUPLICATE DOCUMENT ar: 30 On the basis of ic:: roper curinc

~

Entire document previously On June 12, 1979, Themas Da:tilo, entered inte system under:

ANO 796966 fG/#7 g

g e

w

=

) }8f

.)34 No. of pages:

[O

.