ML19257D766
| ML19257D766 | |
| Person / Time | |
|---|---|
| Site: | 05000574 |
| Issue date: | 01/15/1980 |
| From: | Bickwit L, Hanrahan E NRC OFFICE OF POLICY EVALUATIONS (OPE), NRC OFFICE OF THE GENERAL COUNSEL (OGC) |
| To: | |
| Shared Package | |
| ML19257D767 | List: |
| References | |
| TASK-PS, TASK-SE SECY-80-020, SECY-80-20, NUDOCS 8002060394 | |
| Download: ML19257D766 (48) | |
Text
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l EXPORT lis*0P.T.. l I
UNITED STATES NUCLEAR REGULATORY COMMISSION SECY-80-20_
W ASHINGTON, D. C. 20555 January 1S, 1980_
POLICY SESSION ITEM The Commissioners for:
Jr., General Counsel Leonard Bickwit, Edward J. Hanrahan, Director, OPE From:
Philippine Export License Application
Subject:
We have prepared for your consideration the attached paper which summarizes public comments Discussion _:
received by the Commission in the Philippine proceeding, analyzes various generic options pertaining to NRC consideration of health, safety and environmental effects occurring out-side the United States that could result from proposed nuclear reactor exports, and of the Philippine applications.
A meeting to discuss this paper has been sched e
0 In for January 22.
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Leonard Bickwit, Jr. C 9
'p General Couns 1 M
W Edw J. Hanrahan Dir tor, OPE DISTRIBUTION
Attachment:
Comissioners As stated Comission Staff Offices Exec Dir for Operations ACRS Secretariat Carlton R. Stoiber, OGC 1927 157 CONTACTS:
4-3224 Trip Rothschild, OGC 4-1465 8002060hf
CONSIDERATION OF THE PHILIPPINE EXPORT LICENSE APPLICATIO I.
Background of Current Proceeding Westinghouse Electric Corporation is seeking authorization to export to the Philippines a nuclear reactor (application number XR-On April 19, 120) and certain reactor components (XCOM-0013).
1979, the Commission received a petition for leave to intervene and'~The p requesting a hearing on these applications.
s Jesus Nicanor on behalf of the Center for Development Policy (CDP),
P. Perlas, III, and the Philippine Movement for Environmental Petitioners specifically requested a hearing on Protection (PMEP). the nature and umgnitude.of seismic and geologi-seven issues:
(1)
(2) the~ adequacy of the cal risks posed by the reactor sitesthe environmental impact of the pro-reactor's seismic designs (3)
(4) dangers to the posed reactor and disposition of its spent fuelshealth and safety of dangers to the health and safety of U.S. citizens residing in
.(5)
(6) risks to the effective operation of U.S.
the Philippines:
and (7) generic safety military installations in the Philippines questions posed by nuclear power plants, and by Westinghouse reactors in particular.
the Commission ordered fur'ther public proceed-19, 1979, On October it in making the statutory licensing determinations ings to assist required by the Atomic Energy Act and to' advance the public inter-The Commission invited members of the public to submit views on six specific issues relating to the proper scope of the Commis-est.
sion's jurisdiction to examine health, safety and environmental questions arising from construction and operation of exported nuclear facilities, and the appropriate procedural framework for considering such issues, if they are found to lie within NRC's The Commission decided not to solicit comments at that authority.
time on issues related to the particular health, safety and environ-and to defer considera-mental aspects of the Napot Point facility, led on jurisdictional tion of such issues until,the Commission ru questions.
In response to this order, which was published in the Federal Register, the Commission received submissions from more than twenty The Commission separate organizations, groups or companies.
The public interest groups received a wide spectrum of views.
generally argued that the Commission had authority un such as could affect U.S. common defense and security interests, military bases, and also those that could affect citizens of the The nuclear industry commentors on the other recipient nation.
hand argued that the Commission had no authority to consider health, safety and environmental impacts occurring outside of the The NRC Staff, and the Department of State, on United States.
They behalf of the Executive Branch, took an in-between position.
1927 158
2 argued that'the Commission could consider such impacts, but only to the extent U.S. common defense and security or U.S. public health and safety could be affected.
Thus, the Commission could, in their view, consider impacts upon American military bases.
Appendix 1 to this paper contains a summary and analysis of the comments received.
Before outlining Commission options in this proceeding, we thought it would be useful to summarize past Commission decisions related to the jurisdictional questions raised by the Philippine applica-tions.
II.
NRC Precedents on Foreign Health, Safety and Environmental Issues In Edlow. International, 3 NRC 563 (1976), the Commission first addressed the question of whether it had jurisdiction to consider health, safety and environmental impacts arising in a foreign country from a proposed export.
In that matter NRDC, the Sierra Club, and the Union of Concerned Scientists urged the Commission to analyze the health and safety risks that would occur in India, if the United States were to authorize the export of reactor fuel to India for use at the Tarapur reactors.
The Commission denied the request, asserting:
[W]e strongly believe that a licensing proceeding for two shipments of nuclear fuel, before a federal administrative agency in the United States, is not the proper forum for raising issues concerning the safe op; ration of a nuclear power plant operated by a sovereign foreign government, outside the territorial jurisdiction of this country, and distant from our borders.
3 NRC at 575.
The Commission re'asoned:
[I]t would be extraordinary, as a matter of inter-national law, to conclude that we had authority to address ourselves to, or attempt to regulate matters so clearly domestic to the Indian nation and within the purview of its own regulatory responsibilities.
3 NRC at 582.
Shortly thereafter, in Westinghouse Electric (ASCO II), 3 NRC 739 (1976), the Commission outlined the factors it would consider in determining whether proposed exports were inimical to the common defense and security of the United States.
The Commission declared:
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3 The Nuclear Regulatory Commission and its predecessor agency, the Atomic Energy Commission, have continu-ously taken the view that the health and safety impact in foreign nations of exported nuclear facilities and material is outside the jurisdiction of the Commission.
3 NRC at 754.
In Babcock and Wilcox, 5 NRC 1332 (June 27, 1977), a West German citizens' group asked the Commission to prepare an environmental impact statement assessing the impact of a proposed reactor on the West German environment.
In a lengthy opinion, the Commission held that the National Environmental Policy Act did not require the Commission to prepare an individual environmental statement assess-ing the site specific impacts of a particular proposed nuclear export on territory within the sovereign jurisdiction of a foreign government.
The Commission concluded that NEPA only required an assessment of impacts that would occur in the United States or the global commons (areas outside the territorial jurisdiction of any nation state).
In reaching its decision the Commission relied heavily upon the traditional rule of international and domestic U.S. law that federal statutes apply only to' conduct within, or having effect within, the territory of the United States, unless the contrary is clearly indicated in the statute.
The Commission examined NEPA and,its legislative history and could not find a clear-cut Congressional determination that NEPA was intended to have an extra-territorial effect.
The Commission concluded its decision by asserting that " health and safety impact in foreign nations of exported nuclear facilities and materials is outside the jurisdiction of the Commission."
5 NRC at 1353.
This later assertion,was reiterated in an opinion the Commission issued one day later in Edlow International (Tarapur), 5 NRC 1358, 1364.
In the summer of 1977 the Commission requested the NRC Export Study Gro:tr (consisting of representatives of IP, ELD, OGC, OPE, and NMSS) to examine the question of what responsibility the Commission should have to scrutinize health and safety matters abroad.
The C6mmission directed the study to examine the extent to which, as a matter of policy, it might be desirable to give regulatory atten-tion to health and safety issues arising from nuclear exports.
In July of 1978, the Export Study Group submitted its report to the Commission (SECY 78-365).
The Group considered seven options:
(1) expand NRC's foreign assistance programs (2) institute a U.S.
initiative in the IAEA to improve foreign health and safety pro-grams; (3) have NRC regulate the quality of exported equipment to the same extent that the quality of such equipment is now assured under domestic nuclear licenses; (4) have NRC provide on a routine basis design modification and other health and safety information to foraip regulatory authorities; (5) have NRC conduct a limited foreign health and safety review of exports, issuing a letter of safety findings and recommendations at the conclusion of the review; 1927 160
4 (6) require an NRC finding that the recipient country has an ade-quate regulatory capability and adequate health and safety standards; and (7) have NRC assist other U.S. agencies to perform health and safety analyses of nuclear export projects.
After reviewing this paper, the Commission approved in principle alternatives one, four and seven, deferring adoption of.the other alternatives.
Commis-sioners Bradford and Gilinsky expressed separate views on the paper.
(See Appendix 2). -
Shortly thereafter, the House of Representatives addressed the issue.
Congressman Cavanaugh introduced an amendment to a bill extending the life of the Export-Import Bank (H.R.12157) which would have required the NRC, in cases where the Export-Import Bank proposed to finance a nuclear reactor export, to prepare an analysis describing the nuclear regulatory organization and practices of the recipient country, and also indicating the extent to which the health and safety standards adopted and implemented by the recipient country are consistent with those established by the NRC and, where applicable, with the IAEA standards and recommenda-tions.
On July 27, the House defeated this amendment by a vote of 266-106.
The Senate in cohsidering the Export-Import Bank bill considered the health, safety and environmental jurisdiction question in a different context.
Senator Stevenson introduced an amendment to the bill which specifically stated that NEPA did not apply to activities of Eximbank (including nuclear export financing) which did not have an environmental impact within the United States.
The Senate debated the extraterritorial reach of NEPA, but sus-pended the debate without taking a vote or that amendment. 1/
Subsequently, a substitute amendment was offered which was adopted by the Senate, which provided that no environmental rule, regula-tion or procedure shall become effective with regard to exports subj ect to the NNPA until the President had reported to Congress on the progress made in providing for cooperation on environmental matters in new agreements for cooperation. 2/
In November, 1979 the Department of State on behalf of the President submitted this report.
The Philippine applications raise the foreign health and safety questions in a different context than those previously considered.
This is the first time the Commission has been requested to address the issue in the context of an export to a nation which has had no previous construction or operating experience with nuclear power 1/
124 Cong. Rec. S16861-16864 (October 2, 1978).
~-
2/
See 42 U.S.C. 2153e-1.
1927 161
5 Moreover, to'our knowledge this !.s the first time t' hat reactors.
a proposed reactor export is to be site.
. close proximity to a In addition, there have been two developments U.S. military base.
that may place these applications in a somewhat different light from the Edlow and Babcock and Wilcox situations.
First, in January of 1979, President Carter issued Executive Order 12114, which requires agencies of the U.S. government to prepare an environmental assess-ment addressing impacts of major federal actions outside the United States.
Although some U.S. nuclear exports (such as fuel shipments) are exempted from the provisions of the order, Executive Branch determinations on nuclear reactor exports are specifically < included.
This order, inter alia, constitutes an Executive Branch determina-tion that carefully tailored health, safety and environmental reviews need no" constitute an unwarranted intrusion upon foreign On September 20, 1979, the Commission met in closed sovereignty.
session to discuss what role, if any, it would play in implementing this Executive Order.
The Commission decided to defer considera-tion of that issue until it had issued its Philippine jurisdiction decision on the grounds that it was premature to determine what kind of resources it was willing to provide the Executive Branch in preparing such assessments until it had determined the proper scope of its foreign health and safety jurisdiction.
A second changed circumstance is the increased international concern about reactor safety which has followed in the wake of the TMIs accident in March of last year.
A final background development which should be noted concerns the lawsuit filed by Westinghouse in the United States District Court for the District of Columbia in August of last year challenging the pace at which the NRC and the Executive Branch were processing the Philippine applications.
Westinghouse argued that the Commission had no jurisdiction to consider foreign health and safety impacts arising outside of the territory of the United States.
The Depart-of Justice, af ter consulting with the Department of State and ment OGC, took the position for the U.S. Government that the Commission and the Executive Branch were not barred from considering health and safety effects arising outside United States territory because these factors could bear on the Commission's determination whether a proposed reactor export would be inimical to the common defense and security of the United States.
The rationale for this position is that health and safety risks could harm U.S. relations with a recipient country, affect U.S. citizens living abroad, and jeopar-dize U.S. security or defense interests, such as military base The District Court summarily dismissed the case, holding rights.
the Commission's processing of the Philippine application had not been arbitrary or capricious.
Westinghouse recently withdrew its appeal of that decision.
1927 162
6 III.
Scope of Commission's Jurisdiction -- General Legal Analysis The primary legal issues the Commission must resolve in this proceeding are (1) as a general matter may or must the Commission evaluate health, safety and environmental effects that would occur in the recipient nation and do not bear on U.S. interests 3/ or the global commons 4/ in making its determination whether a gi~en export is inimical to the common defense and security or public health and safetyi (2) as a general matter may or must the Commission evaluate the health, safety and environmental effects of exported facilities upon U.S. interests abroad or the global commons in making its determination whether a given exoort is inimical to the common defense and securi.ty or public health and safety, and (3) if the Commission is required to examine the effects described in 1 and 2 above, or determines that it may do so and chooses as a matter of discretion to do so, are there legal limitations on the nature or scope of the review?
1.
Does the Commission Have the Authority in Making Its Inimicality Determination to Evaluate Health, Safety and Environmental Effects That Would Occur.
in the Recipient Nation and do not Bear on U.S.
Interests?
Some of the public interest group commentors took the position that the Atomic Energy Act, NEPA, and the NUPA provide the Commission with legal authority to conduct a full-scale health, safety and environmental review that would include a consideration of impacts upon the nationals of the recipient nation.
Primary reliance is placed on Section 103sd) of the Atomic Energy Act, which provides that before the Commission may issue a reactor export license, it must determine that proposed export is not " inimical to the common defense and security or health and safety of the public."
-3/
For purposes of this paper we are defining "U.S.
interests" to, include military bases located abroad and large communi-ties of American citizens residing on a permanent basis in the recipient nation.
The term does not include impacts on American tourists or speculative foreign policy impacts such as harm to U.S. foreign relations with the recipient country that could occur from an accident at an American supplied reactor.
4/
For purposes of this paper we are defining " global commons"
~
to include areas, such as the high seas, Antarctica, and outer space that are not within the territorial jurisdiction of a single nation state.
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7 The NEPA argument is premised on an expansive reading of Section 102(2)(F) of that Act which requires federal agencies to the fullest extent possible to:
Recognize the worldwide and long-range character of environmental problems and, where consistent with the foreign policy of the United States, lend appropriate support to initiatives, resolutions, and programs designed to maximize international cooperation in anticipating and preventing a decline in the quality of mankind's world environment.
Various provisions of the NNPA which pertain to cooperation with foreign nations on environmental matters are also cited.
The nuclear industry firmly asserts that the Commission lacks the authority to consider such impacts, arguing that Congress has not expressly authorized such reviews and that in the absence of a
' specific Congressional mandate, such a review would constitute a violation of the doctrine that U.S. laws are not to be applied extraterritorially.
We have reviewed the argument and conclude that the Commission lacks the legal authority to consider health, safety and environ-mental impacts that do not bear on the global commons or U.S. common defense and security or public health and safety interests.
As noted above, Section 103(d) of the Atomic Energy Act provides that the Commission may not issue a reactor export license application "if, in the opinion of the Commission, issuance
. would be inimical to the common defense and security or to the health and safety of the public."
Until quite recently, Congress, however, did not provide the Commission with additional guidance regarding what factors the Commission must or could take into account in making this determination.
In particular Congress never explicitly stated whether the public health and safety finding was intended to cover solely impacts on U.S. residents or whether it also applied to citizens of the recipient nation, or to Americans residing abroad.
Prior to the enactment of the NNPA, which delineated specific export licensing criteria, the Commission considered responses to eight questions which it posed to the Executive Branch on each license application in making its inimicality determination.
These ques-tions focused primarily on safeguards and non-proliferation con-cerns, but permitted consideration of "other factors".
Although the NNPA added specific licensing criteria to the Atomic Energy Act (Sections 127 and 128), it preserved the requirement that the Commission make an inimicality determination.
The House report commented upon the retention of this requirement as follows:
"in the absence of unusual circumstances, the com-mittee believes that any proposed export meeting the criteria set forth in subsection 127a. and, 1927 164
8 when it becomes effective, subsection 128a., would also satisfy the common defense and security s tandard." 5/
This House Report statement is somewhat ambiguous because one cannot tell whether it pertains only to the " common defense and security" portion of the inimicality finding or whether it was also intended to apply to "the public health and safety" finding. One cannot persuasively argue that it was intended to apply only to the " common defense and security" finding because use of the phrase " common defense and security" may well have been a shorthand way of refer-ring to the entire inimicality finding.
This conclusion is forti-fied by the fact that the report does not contain a reference to the phrase "public health and safety."
The Senate report is more explicit, clearly rejecting any thought that non-U.S. interests would be considered.
It states:
Although the NRC finding on the health and safety of the public refers only to the American public, it should be recognized that certain everseas activities could pose a threat to Americans. 6/
In interpreting this statutory provision great weight must also be given to the traditional rule of domestic U.S. law that federal s*.atutes apply only to conduct within, or having effect within, the territory of the United States, unless the contrary is clearly indicated in the statute. 7/
Thit rule of domestic U.S. law is linked to the fundamental inter-national law concept of " territorial sovereignty" which governs the conduct of relations between nation states.
The character of territorial sovereignty in international law has been described as
. both complete and exclusive.
It Laplies the
..supreme and full jurisdiction of the state over its territory, comprising the power to develop all 5/
H. Rep.95-587, 95th Cong., 1st Sess, at p. 21.
6/
S. Rep.95-467, 95th Cong., 1st Sess., at p. 13.
7/
Restatement (Second) of Foreign Relations Law 5 38 (1972);
Steele v. Bulova Watch Co., 344 U.S. 280, 285 (1952); American Banana Co. v. United Fruit Co., 213 U.S. 347 (1909).
1927 165
9 branches of state legislation in the framework of its own legal order without external interference. 8/
The exclusive character of a state's territorial sovereignty has been repeatedly affirmed in the decisions of international tri-bunals.
For example, in one well-known arbitral decision, the concept was discussed as follows:
Sovereignty in the relation between States signifies independence.
Independence in r; gard to a portion of the giche is the right to exercise therein, to the exclusion of any other State, the functions of a State. 9/
The Permanent Court of International Justice put the point even more strongly:
. The first and foremost restriction imposed by
..international law upon a State is that -- failing the existence of a permissive rule to the, contrary -- it may not exercise its power in any form in the terri-tory of another State. 10/
Regulation of economic and industrial activities taking place within a nation's territorial boundaries, to protect the health and safety of persons residing in that nation, is a recognized function of the territorial sovereign.
Therefore, unless a State agrees -- by treaty or other appropriate international arrangement -- to cede all or part of these functions to another State, attempts by an outside State to carry out such functions generally would be regarded as an unwarranted intrusion into the affairs of the territorial sovereign.
In the present proceeding, the Government of the Philippines has made it clear that it would regard a detailed health and safety review of the Napot Point Reactor by agencies of the U.S. Government as intruding upon its sovereign responsibilities.
Another legal argument against NRC health and safety reviews for exports is that if they are done in a detailed comprehensive manner they would be inconsistent with the requirement in Section 126 ef the Atomic Energy Act that export licensing decisions be made in a timely fashion.
That.section contemplates that the Executive Branch would generally provide its views to the NRC on an export licensi.1g
-8/
M. Sdrensen, Manual of International Law (1968) at p. 316.
9/
Island of Palmas Case (United States and the Netherlands),
Permanent Court of Arbitration, 2 U.N. Rep. Int'l Arb.
jg2]
}66 Awards 829 (1928).
10/
The Lotus Case (France v. Turkey), P.C.I.J. Reports, Series A, No. 10.
4 10 application within 60 days of the filing of the application.
The Commission would have a maximum of 120 days to make its licensing determination. 11/
The NRC time limits are expanded if the Com-mission orders public proceedings on an application.
In such a case the NRC has 60 days after the termination of the proceeding in which to act.
Based on the NRC staff estimate, the two-year period required to do a detailed review would far exceed the time period envisaged under the statute.
One could argue that the Commission could routinely expand the time limits on each reactor case by ordering a public proceeding on each application and making the health, safety and environ-mental review part of the proceeding.
The Commission under this approach would then have 60 days after completion of the review to act upon the application.
Although this would be legally possible under a strict reading of the statute, it would conflict with the clear expectation of Congress that reviews would ordinarily be completed.in a cuch shorter time.
It can be further argued that such a prolonged review would be inconsistent with the NNPA's policy that the U.S. be perceived as a reliable supplier of nuclear commodities.
Many countries might choose to purchase reactors from other countries because of this delay.
Moreover, a detailed review would require a significant allocation of NRC resources.
It is at least arguable that a specific budget item would be necessary before the Commission could authorize expenditures for such a broad, new NRC export review. 12/
Of less significance but worthy of mention is the action of the House of Representatives in rejecting the Cavanaugh amendment.
Under the amendment, the NRC would have prepared a report describing the nuclear regulatory structure in the recipient country and
--11/
These maximum limits were, by no means, expected to be the norm -- the legislative history contains expression of hope that the process would usually be shorter.
--12/
The Controller's office has informed us that any NRC activity requiring an expenditure of $500,000 or more is submitted to Congress for approval as part of the annual NRC budget.
If NRC expected to conduct more than one reactor export review per year, the $500,000 figure would be exceeded and Congressional authorization would thus be required.
Any activity of the Commission which requires reprogramming of more than $500,000 of Commission funds also requires Congressional approval.
See the February 6, 1979 letrer from Representative Bevill to Lee Gossick.
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11 examining the regulations adopted by the recipient government to determine whether these regulations conform with U.S. and IAEA rules, standards, and guidelines.
This report would have been used by the Export-Import Bank in making its reactor export financing decisions.
Representative Bauman in the floor debate took the position that neither the Atomic Energy Act nor the NNPA requires the Nuclear Regulatory Commission to raview the health and safety standards of the recipient nation. 13/
No Representative challenged this assertion.
There were several statements made during the floor debate that even this type of review, which would not require site visits, would constitute an unwarranted intrusion into foreign sovereignty. 14/
We also examined other portions of the NNPA which specifically pertain to environmental protection to determine their bearing on In the question of health, safety and environmental reviews.
Section 2(d) Congress stated as a matter of national policy that the United States should cooperate with foreign nations in identifying and adapting (sic] suitable technologies for energy production that would be " consistent with the economic and material resources of those nations and environmental protection."
Section 501 of the Act implements this policy by providing that the United States "shall endeavor to cooperate with other nations
. in protecting the international environment from contamination arising from both nuclear and non-nuclect energy activities The President is required to report annually to Congress on how this section of the Act is being implemented.
From the textual reading of the statute, one finds a Congressional mandate that the U.S. cooperate with other nations on matters per-but taining to the protection of the international environment, no reference to an NRC health, safety and environmental review as part of the export licensing process.
The legislative history of these provisions also fails to express a clear Congressional intent that the NRC conduct such reviews before making its export licensing determinations.
Although arguing from a failure of Congress to take a particular action is usually of limited legal value, Congressional silence is significant here in light of the widely accepted principle described above that U.S. laws are not to be given extraterritorial impact, absent a clear Congressional mandate to the contrary.
Moreover, in light of Congressional familiarity with the Commis-sion's Edlow and Babcock and Wilcox decisions, it would have been reasonable to expect a specific provision overruling those decisions if Congress desired a complete health and safety review as part of the export licensing process.
13/
124 Cong. Rec. H.7432 (July 27,1978).
14/
Id. at H.7434-7438.
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12 The third statute ws reviewed was NFPA.
In the Commission's Babcock and Wilcox viin'rm, 5 NRC 1532 (1977), the Commission care-fully analyzed NEPA and its legislative history and determined that NEPA only required an assessment of the environmental impacts that would occur in either the U.S. territory or the " global commons."
The Commission took the position that NEPA did not require an assessment of impacts occurring in foreign countries.
The Commis-sion reasoned that such a reading of NEPA would constitute an extraterritorial application of U.S. law and, under domestic law, U.S. statutes are not to be given extraterritorial impact unless Congress has clearly expressed such an intention.
In that opinion, the Commission reviewed the legislative history of NEPA and found no such expression of Congressional intent.
Subsequently, the Department of Justice examined the scope of NEPA and reached the same conclusion. 15/
As a result of this Justice Department opinion, E.O.121TT, which mandates a procedure for assessing environmental impacts occurring abroad which may result from certain major federal activities, significantly does not cite UEPA as legal authority for the President's action.
Instead, it states that the order:
"[W]hile based on independent authority
. furthers the purpose of the National Environmental Policy Act In sum, we find no basis for altering the basic thrust of the Commission's NEPA analysis in the Babcock and Wilcox opinion.
Finally, we have examined E.O. 12114, entitled " Environmental Effects Abroad of Major Federal Actions," issued by President Carte > on January 4, 1979.
That order specifically requires the Executive Branch to prepare an environmental assessment of nuclear reactor exports because they "significantly affect the environment of a foreign nation." 16/
The stated purpose of this order "is to enable responsible officials of federal agencies having ultimate responsibility for authorizing and approvin'g actions encompassed by this Order to be informed of pertinent environmental considera-tions and to take such considerations into account, with other pertinent considerations of national policy, in making decisions regarding such actions. 17/
However, Section 2-5(v) of the Order specifically exempts NRC export licensing decisions from the pro-visions of the Order.
Thus, under E.O.12114 only the Executive Branch recommendation to the Commission on whether a given license should be issued is covered by the Order.
15/
The Justice Department Opinion is set forgt. J.n the Legal Times of Washington, October 9, 1978 at p. 30.
16/
See 5 2-3(c)(1) of the Order.
17/
~~
Id. 5 1-1.
1927 169
13 Moreover, even in the absence of Section 2-5(v), it is our judgrent that there is no legal requirement that the Commission participate in the Executive Branch environmental review or consider that document in its export licensing decisions.
Because the NRC is an independent regulatory agency, it is not legally bound by executive orders pertaining to substantive aspects of its decision-making See Memorandum from Assistant' Attorney General John M.
process.
Harmon to EEarles Warren, April 4,1977; Humphrey's Executor v.
United States, 295 U.S. 602 (1935).
the In sum, we are unable to find any Congressional assertion that HRC is to take into account health, safety, and environmental matters having no bearing on U.S. interests.
This is significant in light. of the fact that U.S. laws are not to be applied extra-territorially in the absence of a c15ar congressional mandate.
explicit congressional expression on the matter is the The most should be Senate Committee Report on the NNPA which, if anything, interpreted to preclude taking such information into account.
Moreover, E.O.12114 does not mandate the NRC take such informa-tion into account in its licensing decisions.
2.
May or Must the Commission Evaluate the Health, Safety and Environnental Effects of Exported Facilities Upon UTE. Interents Abroad or the Global Commons in Making Is InimicaT?
its Determir.a_ ion Whether a Given Export t
Sec-The public interest group ccmmentors took the position that tion 103(d) of the Atomic Energy Act which requires the Commission to make the'inimicality finding (discussed in detail above) requires the Commission to consider the health, safety and environ-mental effects resulting from a reactor export which could affect U.S. interests such as U.S. military bases located near the pro-pos'd reactor site, or large communities of American citizens residing abroad.
Focusing specifically on the proposed Napot Point reactor, numerous commentors note that two important U.S. military bases are located within forty miles of the rec _ tor site.
It is argued that an acci-dent at the plant could be inimical to the common defense and security of the United States because radioactive releases from the plant could contaminate the bases, rendering them unusable for an indefinite period.
These commentors also stress that reactor and that the exports are generally financed by the U.S. Government, citizens of the recipient nation view U.S zxported reactors as American projects.
They argue that the u.T would be blamed for any accidents and that such an event could jeopardize U.S. rela-tions with the recipient nation.
One commentor stated that the United States would be severely criticized if an accident occurred, the and raised the possibility that claims might be filed against United St&ces for compensation, for aid in clean-up operations, and 1927 170
i 14 for damage repair.
An argument is also made that the proposed Philippine export could adversely affect the public health and safety of the more than 30,000 American citizens residing near the proposed reactor site.
The NRC staff and the Executive Branch both believe that the Com-mission is authorized to consider impacts en U.S. interests abroad, especially on U.S. mi?.rtary bases.
The nuclear industry, on the other hand, argues that the Commission lacks jurisdictlon to consider health, safety and environmental impacts, even if they affect U.S. interests.
It is argued that any consideration of health, safety and environmental impacts occurring in the recipient nation constitutes an unwarranted invasion of the recipient nation's sovereignty.
It is further asserted that there is nothing in the legislative history of the Atomic Energy Act or the NNPA which indicates that the Commission is to " speculate" on the impacts of exported material on U.S. military bases located abroad.
It is also t rgued that any health, safety, and environ-mental review addressing impacts abroad, would be inconsistent with the NNPA goal of making the United States a reliable supplier because such reviews would substantially harm the competitive position of U.S. nuclear exporters vis-a-vis vendors from other nations who are not encumbered by procedures which recipients could consider an intrusion into their sovereignty.
We have excmined the Atomic Energy Act and NEPA to determine whether the Commission is required or permitted to examine health, safety and environmental effects occurring abroad that could affect U.S.
interests.
We conclude that the Commission is neither required to nor precluded from examining such impacts.
The decision whether to examine such effects is thus a policy cecision.
The basis for this conclusion is discussed below.
The text of Section 103(d) of the Atomic Energy Act requires the Commission to make a finding that a reactor export is not " inimical to the common defense and security or the public health and safety."
Even if this phrase is given the incerpretation that the Commission hasigiven it to date -
" common defenra and security of the United States or the public health and safety of the United States" 18/ --
this does not resolve the legal question because it does not definitively answer the question whether "U.S." is to be narrowly construed to mean U.S. territory or whether it also includes U.S.
interests abroad, such as military bases.
The legislative history of this provision.also provides little guidance on its proper interpretation.
Even the House Committee Report on the NNPA (p.
7., supra), if construed to mean that the 18/
10 CFR 55 110.2(g) and (ii)'.
~~~
1927 171
15 Commission may only take into account safeguards and non-prolifera-tion concerns, indicates that the Commission can take other factors into account in " unusual circumstances."
In cases where an exported reactor is to be at a site near a U.S. military facility or a large community of Americans abroad, and there is a concern that the reactor could adversely affect U.S. military operations or the health and safety of the U.S. citizens, it can be argued that this would constute" unusual circumstances" and the Commission, in its discretion, could examine the effects on these U.S. interests.
The Senate Committee Report on the NNPA (p. 8, supra) is more explicit, stating that, in making its inimicality determination, the Commis-sion should recognize "that certain overseas activities could pose a threat to Americans."
Although this can be read as a clear indication that the Commission is required to take into account impacts abroad that affect U.S. interests, it is not entirely free from ambiguity.
It could instead be read more narrowly.to indicate that if a proposed reactor export to Canada or Mexico is to be located near the U.S. border, the U.S. must consider the impacts on U.S. citizens and territory.
F ' Commission has always taken the position that in such a case the Commission would consider the impacts, and perhaps it is to this policy that the Committee was referring.
In sum, based on a reading of the text of Section 103 and its legislative history one cant.ot find a clear mandate from the Con-gress that the Commission must take into account health, safety or environmental interests that affect U.S. interests abroad; nor can one find a clear expression that the Commission is not to examine such impacts.
As discussed above, the absence of a clear congressional mandate would ordinarily preclude application of U.S. law in an extra-territorial context.
However, in the present case two legal principles may permit limited exceptions to this doctrine where clear interests of the United States and its citizens are implicated.
The first of these concepts is the widely accepted principle that a state may exercise jurisdiction over its nationals, with respect to their conduct whether within or outside its territory. 19/
This " nationality" concept is relevant here, of course, because of the presence of large numbers of U.S. citizens living in proximity to the reactor site.
The second of these concepts, called the " protective principle,"
typically arises in the criminal law field, where jurisdiction over an offense may be determined by reference to the national 19/
M. Sdrensen, Manual of International Law, pp. 356-357 (1968).
l927 172
16 interest injured by the offense. 20/
For example, U.S. courts have employed this theory to sustain convictions of aliens who outside the United States swore falsely before an American consul to obtain documents with which to enter the country illegally. 21/
In the present case, the U.S. interest to be protected is the sue-stanial national security interest in having continued unimpeded access to the Clark and Subic Bay military bases.
We do not conclude that these principles override the sovereignty principle discussed above in guiding our interpretation of ambiguous statutes.
Rather, the applicability of such principles to a given fact situation can serve to remove the presumption otherwise created by the sovereignty principle and thus allow for a " presumption-less" look at the operative statute.
If the statute is ambiguous -- as we conclude it is with respect to impacts on U.S. interests abroad -- we conclude that the Commission legally may examine or ignore such impacts so long as its basis for either course of action is defensible on policy grounds.
We also examined NEPA to determine whether NEPA required the Com-mission to examine environmental impacts abroad that could affect defined U.S.
interests.
The statute and its legislative history do not address this issue.
It is clear that under NEPA the Commis-sion must examine impacts that occur in the United St'ates.
In its Babcock and Wilcox decision, the Commission, in our view, correctly concluded tnat NEPA did not require an assessment of impacts upon the local citizens in the recipient nation.
The Commission and, to our knowledge, the courts have never addressed the issue whether NEPA requires an assessment of environmental impacts abroad that affect U.S. interests abroad. 22/
We believe that on the basis of the text of the statute, its legislative history and the discussion above with respect to the sovereignty principle where U.S. interests abroad are involved that it is an open question and the Commission is free to resolve the issue on policy grounds.
We have examined both the Atomic Energy Act and NEPA to determine whether either the text or legislative histories of those statutes 22/
Dickinson, Introductory Comment to the Harvard Research Draft Convention on Jurisdiction with Respect to Crime, 29 A.J.I.L.,
Supp., 443 (1935), cited in Harris, International Law at 236 (1973).
21/
Rocha v.
U.S., 288 F.2d 545 (1961) at 549.
22/
There are, however, a series of cases holding that NEPA requires an examination of health and environmental effects that would occur within the territorial U.S. as a result of a major federal action in a foreign nation.
Sierra Club v.
Adams, 578 F.2d 389 (D.C.Cir. 1978): Wilderness Society v.
Morton, 463 F.2d 1261 (D.C. Cir. 1972); National Organiza-tion for Reform of Maryland Laws v. U.S. Department of State, et al., 452 F. Supp. 1226 (D.D.C. 1978).
1927 173
17 require an assessment of the impacts on the global commons resulting from export licensing decisions.
We found no legislative guidance and no judicial decisions on point.
However, in 1974 the Sierra Club sued the AEC in the United States Distric. Court for the District of Columbia for its failure to file environmental impact statements on nuclear exports.
The AEC settled the case agreeing to prepare a generic environmental impact statement (Final Environmental Statement on U.S. Nuclear Power Export Activities, ERDA-1543 (1976)) assessing the impact of exporting nuclear power facilities on U.S. territory, and the global commons.
Since that date the Commission has taken into account in its export licensing decisions impacts on the global commons.
We do not recommend a change in that policy.
Because the ERDA environmental impact statement concluded that the entire U.S. reactor export program had only a minimal environmental impact upon the global commons, it is our view that there is no legal requirement that the Commission prepare an impact statement for each reactor export assessing the impact of the proposed export on the global commons.
Such an e,ffort would not be meaningful because in each case the conclusion would be that the impact is insignificant.
3.
If the Commission is Recuired to Examine the Effects Described in Questions 1 and 2 above, or Determina-tions That It May do so and Decides to do so as a Matter of Policy, are There Legal Limitations on the Nature or Scope of the Review?
Even if the' Commission determines as a matter of law or policy that it will examine health, safety or environmental impacts that occur in the recipient nation, there are legal limitations on the nature and the scope of that review..Under international law a recipient nation could argue that it has the responsibility for assuring the health and safety of individuals residing within its territory and that any consideration by the United States of this factor in its export licensing proceedings constitutes an unwarranted intrusion into matters traditionally reserved to it.
The recipient nation could argue that any interest the United States has in the matter is minimal in relation to the protection of its own sovereign jurisdiction.
1927 174 It is our view that U.S. site visits to evaluate impacts or the proposed export on the global commons or U.S. interests would undoubtedly be treated as an unwarranted intrusion into foreign sovereignty not sanctioned by international law.
It is our view that U.S. requests for information on reactor design, waste management practices or emergency planning do not in themselves constitute an unwarranted intrusion into sovereignty because many nations voluntarily provide this type of information to the NRC as part of cooperative information exchange agreements.
It is the use of this type of information in the NRC licensing process that nations could find to be an intrusion into their sovereignty.
18 It is our conclusion that site visits because of their intrusive-ness are not sanctioned by international law, and we found no domestic statute specifically mandating such visits.
Submitting requests for information that bear on U.S. interests is not pro-hibited by domestic or international law provided that the requests are not so frequent and~ comprehensive that a foreign government could properly conclude that such requests constitute an unwarranted intrusion into their sovereignty.
IV.
Scope of Commission's Jurisdiction -- Generic Options This section descr.ibes and analyzes five possible approaches the Commission could take to examine health, safety and environmental effects of a U.S. reactor export that could occur abroad. 23/
There are an almost limitless number of variations which the Coc5fssion could consider.
However, the following five options represent a broad spectzum of legal and policy choices which can be altered in their details to reflect the specific decision reached by the Com-mission.
Each option contains a description of its advantages and disadvantages, from both a policy and legal perspective.
Each of these options could be applied to reactor export license applications received in the future by the Commission.
- However, as noted in Section V, infra, not all of these options are avail-able in the Philippine case, primarily because the Executive Branch has already prepared an environmental analysis pursuant to E.O.
12114 without Commission participation.
Option 1. Detailed Review of Health, Safety, and Environmental Risks The NRC staff would prepare a health, safety and environmental review for each proposed reactor export, including review of the nuclear steam supply system, the balance of plant design, site suitability, the interfaces between these areas, and waste manage-ment options.
Environmental impacts resulting from construction 23/
The option selected by the Commission (except for option 5) would be applied solely to reactor exports and would not be applied to exports of components or special nuclear material.
This differentation is based on the fact that the health, safety and environmental impacts can be examined in their entirety at the time of the reactor export and the analysis is unlikely to differ in any significant way at the time of subsequent fuel shipments.
19 and normal operation of the plant and emergency planning aspects of the facility would also be fully analyzed to the extent they affect the recipient nation or the United States an'd its citizens. 24/
~-
This review would be more limited than a domestic facility license review because issues such as need for power, alternative forms of electrical generation,. impact of construction upon local residents, and alternative sites would not be examined.
The review of the reactor design would focus upon whether it meets current NRC design criteria applicable to domestic reactors, regu-If variances latory guidelines, and branch technical issuances.
are identified, the NRC staff would determine whether the proposed design provides an equivalent level of protection.
If not, the staff would evaluate the resulting health and safety risks.
The staff would also identify which generic unresolved safety problems apply to the proposed export and assess the health and safety risks posed by these unresolved problems.
Based on this information, the NRC staff would determine whether the proposed facility export poses unreasonable risks to the health and safety of the public or the environment and incorporate its analysis in a document.
This document would be circulated for public comment, and revised to incorporate the comments received.
The Commission in its discre-tion could conduct oral hearings on issues raised by the document and the comments received on it.
The Commission would consider this information in making its inimicality finding.
If the recipient nation failed to cooperate by authorizing site visits or failing to provide requested infor-mation, or if the Commission determined there were major, unresolved health, safety or environmental problems posed by the proposed reactor export, the Commission could either suspend its review of the application or, perhaps, deny the license on inimicality grounds.
The Option 1 approach is a synthesis of a detailed review outlined as an option by the URC o
_r and an approach suggested by the Natural Resources Defense tc'ncil, the Sierra Club, and the Union of Concerned Scientists.
The NRC staff believes implementation of this approach would require at least eleven professional man-years extending over a two-year period, for each proposed reactor export.
1927 176 24/
Where impacts on a recipient nation's population are reviewed,
~~
that review would also cover impacts on the United States and its citizens which are based on the proximity of a large community of Americans to the reactor site.
20 a.
Policy considerations From a policy perspective this option could be of great value to recipient nations, particularly those that have little, if any, In experience in constructing and operating nuclear reactors.
some cases it might enhance the safety of the facility by alerting a recipient nation to design-related or siting difficulties.
Moreover, it could increase the buyer's confidence in the safety of U.S. exports.
In addition, NRDC argues that a detailed review would be consistent with the goal set.forth in Sections 2 and 501 of the NNFA that the U.S. become a reliable supplier, asserting that an essential responsibility of a reliable supp1! er is to assure that the exported product is safe.
However, this option has several major disadvantages.
Because it would require site visits and extensive cooperation from the recipient government to be effect1/ely implemented, some nations would view it as an unwarranted 'ntrusion into their internal affairs.
Although it could be argued that much of the information collected under this option could have a bearing on the U.S.
common defense and security (military bases) or upon U.S. citizens residing in the vicinity of a facility, this information is pri-marily relevant to the recipient's own health and safety determina-tions.
The Department of State emphasizes that foreign governments-can be expected to consider such overlapping reviews an unwarranted intrusion into their sovereign prerogatives.
The Government of the Philippines also takes this position.
Other commenters, such as Ebasco Services, argue that this kind of an approach would have severe foreign policy repercussions because it represents, in effect, a declaration that a recipient government is incapable of determining what is in the best interests of its people in the sphere of health, safety and the environment.
The NRC staff is concerned that adoption of this option could give the false impression that NRC is assuming responsibility for the safety of the facility, leading recipient nations to unduly rely upon NRC, and to reduce their efforts and expenditures to develop an indigenous capability to maintain and operate the plant safely.
This approach would also place a strain on existing NRC resources.
As noted above, the NRC staff believes at least eleven professional man-years extending over a two-year period would be required.
Such a review could take even longer, since it will be difficult to collect the required data, particularly if the recipient country is not fully cooperative.
The most important objection to this approach, however, is that even this detailed review would not NRC would not necessarily ensure the safe operation of the plant.
be able to monitor construction and continually inspect the plant 1927 177
21 during its construction and operating life, a procedure deemed essential to assuring reactor safety in the domestic context.
Another factor to be considered in connection with this approach is that the review responsibility, including costs, is placed on the federal government.
If the recipient government wants a detailed review of health, safety and environmental impacts, numerous U.S. consulting firms can perform the task.
Finally, all nuclear industry commenters strongly expressed the view that uni-lateral health and safety reviews mandated by the U.S. Government would substantially harm the competitive position of U.S. nuclear exporters vis-a-vis foreign vendors, b.
Legal considerations Based on our discussion in Section III above, we do not believe the Commission possesses the legal authority to adopt this option even if it is limited to situations where impacts on U.S. interests or the global commons are at stake.
Should the Commission wish to adopt this approach it should seek legislation.
We reach this conclusion on the basis that it would require extensive cooperation from recipient nations in the U.S. decision making process and also site visits.
This is beyond the scope of the Commission's present jurisdiction.
In addition, such a review could not be conducted within the spirit of the time limitation provisions of the UNPA governing NRC export licensing reviews.
Option 2. Fully Participate in the Preparation of the Executive Branch Health, Safety and Environ-mental Analysis Issued Pursuant to E.O. 12114 Under this option the NRC staff would assist the Executive Branch in preparing its analysis called for by the Executive Order.
This analysis 25/ will describe the recipient nation's regulatory review process and the extent to which the recipient nation has adopted environmental standards comparable to IAEA standards or guidelines, and summarize the major findings and conclusions of any envirnu-mental review that has been undertaken in the recipient nation.
On the basis of literature and other technical information readily available to the United States Government, the document will 25/
See Section 8 of the " Unified Procedures Applicable to
~~
HaTor Federal Actions Relating to Nuclear Activities Subject to Executive Order 12114," 44 Fed. Reg. 65560 (November 13, 1977).
1927 178
22 address salient site characteristics and significant radioactive, chemical or thermal effects on the environment, assess any special factors which could pose significant environmental risks, and describe waste management plans.
It will also discuss whether the equipment wi3'. be manufactured to quality assurance standards comparable to those used in the United States, and identify signifi-cant environmental impacts in the United States or the global commons that could result from the proposed export.
No site visits are contemplated.
Once this document is prepared, it will be submitted to the NRC as part of the Executive Branch's analysis of a given reactor export application.
Under this option, the document would then be "taken into account" by the Commission when it makes its inimicality finding.
The Com-mission could conceivably deny the license if it determined the environmental. impacts that would result from the proposed export were " inimical to the common defense and tec rity of the United States or to the health and safety of the American public."
The Executive Branch recommends this option.
a.
Policy considerations This it, far less intrusive means of examining health, safety, and environtantal effects occurring abroad than the approach described in Option 1.
Although this review would not be nearly as complete as that described in Option 1, it should ensure that major issues are brought to the attention of U.S. decision-makers and to the recipient government.
This review should not affect the time the NRC has to review the license application because the 120-day HRC review period will commence only after the analysis is received.
A further policy advantage is that one unified U.S. government review avoids duplication of effort.
This approach also has several disadvantages.
The review clearly is not as comprehensive as some might find desirable.
Also, foreign policy objectives may preclude thorough assessments of the recipient country's ability to safely construct and op,erate a nuclear plant.
(The implementing procedures adopted by the Executive Branch specify numerous situations which would permit an even less thorough review.) -26/
Moreover, based on the assessment prepared on the Napot Point reactor, the document will almost exclusively focus on environmental concerns.
The Commission might want to have more analysis of health and safety issues.
Another major concern is that, because the State Department is responsible for preparing the document, NRC will have less 26/
Modifications are permitted, for example, to permit prompt government decisions: to avoid adverse foreign policy impli-cations; and when difficulties in obtaining information are SeeSection16oftheimplementingprocedure79 encountered.
1927 1
23 influence over its content than might be desirable.
If the Commis-sion adopts this option, the Commission could make its participa-tion contingent on a right to have any separate NRC views appended to the analysis.
This would assure that both the centent and tone of NRC views are publicly available.
b.
Legal considerations As discussed in Section III above, we believe that there is no legal requirement that the Commission participate in the prepara-tion of the Executive Branch environmental assessment or take the document into account in making NRC's export licensing determina-tions.
Nonetheless, the Commission has the legal authority to participate in the preparation of the document and take it into account in making its "inimicality" determination as outlined in the option.
Option 3. Participate Fully in the Executive Branch Assess-ment Prepared Pursuant to E.O.12114; but Conduct a Separate NRC Review in Certain Circumstances i
Under this approach the NRC would fully participate in che Executive Branch analysis prepared pursuant to E.O.12114 as in Option 2.
However, in cases where NRC is dissatisfied with the scope or thoroughness of the Executive Branch review, or believes that certain issues require further examination (and the Executive Branch is unwilling to examine them further), NRC would conduct an independent review of those issues.
In such matters the Commission might pursue a limited review by, for exemple, a series of questions to the applicant.
In other cases, the Commission might want to conduct a more comprehensive review which could include site visits to gather information on specific topics.
The character of this review would vary on a case-by-case basis depending on the nature of the NRC staff concerns.
If such a review required a detailed analysis of the plant systems or design, this could require several professional man-years spread over a 1-2 year period.
Under this option the Commission could conceivably deny the license if it determined the health, safety and environmental impacts that would result from the proposed export made the export inimical to the common defense and security of the United Sectes or the health and safety of the American public.
1927 180
25 a.
Policy considerations By retaining the option of performing a linited technical review, the NRC could ensure that important health, safety and environmental risks are thoroughly assessed.
Although on the basis of a limited review, staff would be unable to make a determination whether the plant is adequately designed or whether the recipient has suffic-ient capability to operate it, a limited review in certain circum-stances might enhance NRC confidence in the plant's design or the recipient's capability to operate the plant.
On the other hand, a limited review has some of the disadvantages of a full-scale review.
Some foreign governments will consider such a review an unwarranted intrusion into their sovereignty.
U.S. reactor vendors feel even a limited review will make the U.S.
a less reliable supplier and will harm the competitive position of U.S. exporters.
Moreover, depending on the nature of the review and the number of issues to be reviewed, NRC review of export license applications could be delayed significantly.
In addition, other federal agencies may not be enthusiastic about NRC participation in the preparation of E.O. 12114 analyses, if the possibility exists that in a given case, NRC will end up conducting its own review because of dissatisfaction with the Executive Branch review.
Finally, an independent NRC analysis would not make for a very unified or coherent process and could be confusing to the recipient nation.
~
b.
Legal considerations The same legal considerations applicable to option 1 basically apply here.
For example, requiring site visits or other forms of exten-sive cooaeration from the recipient government as a condition of supply snould be specifically authorized by legislation.
Further limited reviews, depending on their scope, routinely might exceed the 120-day period for Comission review set forth in the NNPA.
Thus, if on policy grounds the Commission wants to adopt this approach, the Commission may wish to seek legislation.
However, if the NRC review focused on determining the effects on U.S. interests only, did not involve site visits or other intru-sive forms of data collection, and were for the most part conducted within the time frames contemplated by the NNPA, we believe no further legislation would be required because the Commission could reasonably interpret the Atomic Energy Act to permit such a review.
1927 181
25 Option 4. Participate in Executive Branch Review Pursuantt Upon Request of the Recipient Government Under this approach, the NRC would fully participate in the prepara-to tion of the analysis prepared by the Executive Branch purs E. O. 12214.
For example, NRC requested to do so by the recipient government.
would perform comprehensive reviews of site suitability or reactor This assistance could be provided on a bilateral basis, or perhaps by assigning staff members to the IAEA design upon request.
the review.
and having that body conduct Under this o3 tion, the Commission could deny a license if it deter-f mined that tae export was " inimical" to U.S. interests However, the URC would not 12114 environmental review process.
the deny a license based on information and analyses generated at recipient government's request, Policy considerations a.
From a policy perspetLive, this approach has several advantages.
It would be consistent with NRC's program of assisting foreign It would also countries in matters of nuclear health and safety.
be consistent with the objective of providing greater confidenceFinal in the safety of a proposed export.it would not constitute an unwarranted would be done by request, intrusion into national sovereignty.
First, it might give the There are also several disadvantages. false impression that the N and deter the recipient country from developing sufficientAlso, could be filled by the private sector (e.g., the recipient could indigenous expertise.
Moreover, depending hire U.S. architectural-engineering firms).this could be a significant on the amount of assistance sought, drain on NRC resources t in advance.
Finally, there are disadvantages in not taking analyses developed in the NRC at the recipient government's request into accountThrough thes could be derived regarding the recipient's capability to construct licensing process.
or operate the plant which could conceivably form a basis for If this information were taken into account, however, foreign governments would probably denying a license.
a result of the information generated.
1927 182
l 26 b,sLegal considerations The Commission possesses the legal authority to adopt this option.
Legislation would not be required for implementation, unless requests for assist.ance became so numerous that substantial r resources were neeced to conduc' the contemplated reviews.
Any such reviews could be performed pursuant to the health and safety information exchange agreements the NRC has entered into with various recipient nations.
Option 5. Exclude Consideration of Foreign Health, Safety and Environmental Issues From Export Licensing Reviews Under this approach the Commission would basically reiterate the position that it took in Edlow and Babcock and Wilcox that it lacks jurisdiction to consider health, safety, and environmental impacts abroad.
This approach is recommended by the nuclear industry commentors.
The NRC would not participate in the preparation of the Executive Branch environmental assessment because the assess-ment would not be considered in the Commission's licensing deter-minations.
a.
Policy considerations The nuclear industry favors this approach, arguing that considera-tion of health, safety and environmental impacts occurring abroad should he left to the government of the recipient nation.
The industry argues that any consideration of such factors constitutes an unwarranted intrusion into foreign sovereignty, and that such consideration would inevitably delay the export licensing process, making the U.S. a less reliable supplier.
The industry also argues that if the presence of a U.S. military base triggers a health, safety and environmental review, countries which object to U.S. health and safety reviews would be given a choice of either not purchasing U.S. reactors or not permitting U.S.
military bases in their country.
It is argued that because U.S.
military bases are located in only those countries we consider our closest allies, posing such a choice for those nations would not be in the national interest.
The major disadvantage of this option is that reactors would be exported without any examination of site suitability or the recipient's capacity to operate the plant safely.
The Commission would decline to examine these factors even in cases where there are defined American interests such as military bases or large 1927 183
27 communities of American citizens.
In addition, this approach is inconsistent with the national policy set forth in E.O. 12114 that better understanding is required of the effects which U.S. actions may have on the world's environment.
b.
Legal considerations In Section III above, we concluded that the Commission is not required to take health, safety and environmental impacts occurring abroad into account, but has the legal authority to do so in certain circumstances.
Our nJ< ', therefore, is that this option may be adopted as a legal matuer provided that only impacts on U.S. inter-ests and the global commons are taken into account.
OPE Position Of these options, OPE favors a slight variation on the limited review envisioned under No. 3.
It believes the Commission should participate fully in the Executive Branch assessment and be pre-pared to conduct a limited independent review of its own, if the scope or thoroughness of the Executive Branch assessment proves unsatisfactory.
(OPE would counsel that such a limited independent review be conducted only When a prima facie review discloses egregious deficiencies in the Executive Branch assessment.)
Beyond this approach -- Which, in essence, represents limited Option 3 -- OPE believes special attention should be paid to rea-tor export cases which could involve impacts on U.S. military installations or on sizeable numbers of U.S. citizens residing in proximity to the reactor site.
It is not envisioned that a full-scale health, safety and environ-mental assessment be conducted in such situations, but rather a limited survey of avetlable literature along the lines of that performed by OPE in connection with the Philippine reactor export.
Site visits would not be conducted.
This could be done either by the staff or OPE with the assistance of outside consultants.
Based on the results of such a survey, identified problems or unresolved issues would be communicated to the recipient govern-through the State Department.
Further Commission action, ment theoretically including a license denial on grounds of inimicality, would depend on the recipient government's response to this com-munication.
While such a survey would, by no means, amount to a certification of safety by a U.S. Government agency, it would provide additional assurances to the Commission concerning potential impacts of a foreign facility on U.S. citizens.
OPE believes that such an 1927 184
28 approach would be compatible with all but the most restrictive interpretation of the Commission's statutory authority.
Also, the
" intrusion" problem discussed previously should be less severe given the emphasis this approach would place on substantial and Finally, it is anticipated well-defined United States interests.
that the limited review envisaged here could be accomplished well within the normal 120-day period contemplated in the NNPA for NRC export licensing review consideration, in the absence of signifi-cant difficulties.
consti-OPE recognizes that questions could arise concerning what tutes a U.S. military installation or a sizeable number of U.S.
It would not be desirable to establish inflexible citizens.
criteria in advance.
Rather, each reactor export should be examined upon receipt of the original license application and an early Commission determination made concerning whether a particular factual situation establishes the need for special consideration.
Also assuning cooperation by Executive Branch agencies in this approval, it may be possible to subsume this more detailed review under the Executive Branch analysis prepared pursuant to E.O.
12114.
Finally, it is perhaps worth observing that reactor export cases which could have an impact on U.S. military installations or sizeable numbers of Americans are likely to be the exception rather than the rule.
Indeed, apart from the pending Philippine this export and possibly future exports to Korea, none that fit criterion comes readily to mind.
V.
Options for the Philippine Proceeding The solicitation of public comments on the Commission's jurisdic-tion served a dual function.
Public comments were sought to assist the Commission in determining how it should generically handle health, safety and environmental impacts occurring outside of the United States, and also specifically how these impacts should be considered in the review of the Philippine license applications.
In Section IV above, we have outlined five alternative options for considering these health, safety and environmental impacts in For various reasons several of these NRC export license reviews.
options do not seem to be available in the Philippine proceeding.
and one variation of option 3 (a Option 1 (full-scale review)are not available because additional Congres-comprehensive review) sional authorization is necessary before such approaches could be Option 2 (participation in preparing the Executive implemented.
is also not Branch environmental assessment pursuant to E.O.12114) available because that document has already been transmitted to NRC Option 4 (assist the foreign government by the Executive Branch.
in preparing health, safety and environmental analysis upon request) is also unavailable because the Philippine Government has not 1927 185
29 requested additional U.S. assistance. 27/
The final option (do not consider foreirn health and safety impacts at all) is available.
In sum, the generic options discussed in Section III are more readily applicable to future reactor export applications.
With respect to the Philippine application, the Commission has two alternatives which we will outline below.
1.
Determine That the Commission Has Sufficient Information to Make Its Inimicality Finding Under this option the Commission would issue a two-part opinion.
The first part would describe how it intends to consider foreign health and safety matters in export licensing matters.
The Commis-sion's options are outlined in Section IV above.
The second part of the opinion would address whether the Philippine applications meet the export licensing criteria set forth in Sections 127 and 109 of the Atomic Energy Act.
It would also address whether the proposed exports are inimical to the common defense and security or public health and safety.
The Commission would make this latter determination on the basis of the Executive Branch analysis of the license application, the environmental assessment prepared pursuant to E.O. 12114, the Puno Commission Report, the IAEA Report, and the OPE analysis of the IAEA report.
2.
Determine That Additional Information Is Required Before the Commission Makes Its Inimicality Finding The Commission could determine that it needs more information on issues relating to the health, safety, and environmental impacts occurring in the Philippines before making its decision.
In such a case the Commission might wish to obtain this information by soliciting additional public comments on specific issues.
Possible issues which the Commission night want to obtain additional infor-mation on are listed in Appendix 1, pp. 8-9.
27/
The NRC has responded to a series of technical questions
~-
posed by the Philippine Government.
In addition, the NRC at the request of the Philippine Government assigned Charles Willis of the NRC staff to the IAEA for a year.
During his IAEA to.nure he assisted the Philippine Government on the Napot Point project.
1927 186
30 Further public proceedings could be based on either a legislative or adjudicatory format.
Under a legislative format, which is set forth in Part 110, individuals would be asked to provide informa-tion on specific issues by submitting written comments to the Commission.
After reviewing these comments, the Commission could determine that oral hearings were appropriate on certain' issues.
Alternatively, the Commission could grant petitioners ' request by waiving application of Part 110 procedures and ordering adjudica-tory hearings.
In such a case the Commission would have to deter-mine whether it would sit as the hearing panel or whether it wishes to establish a special hearing board for this purpose.
Another means to obtain additional information would be to order the staff or OPE to conduct a limited technical review of certain specified issues (option 3),.
Under this approach public comments would not be sought.
Discussion Clearly, if you choose option 5, there is no need for a follow-on proceeding to develop additional information.
Option 1 is.not available because in our view legislation is required.
Waiting for legislation to be enacted would entail substantial delay in Cormis-sion action on the Philippine application.
However, should you decide that one of the intermediate generic.
options was the appropriate scope of NRC consideration of health, scfety and environmental factors in export licensing, the Commission may already have sufficient informati,n on which to base its inimi-cality determination.
The information available to the Commission includes:
Preliminary Site Information and Preliminary Safety Analysis Reports, which provide substantial descriptive and analytical material for the PNPP-1 site.
The Report of the IAEA Safety Mission on Geological Hazards and Geotechnical Aspects, which includes discussion and recommendations on specific technical items on geological hazards and geotechnical factors (May 1978 and July 1978).
Philippine Atomic Energy Commission (PAEC) Evaluation of the Responses on the Issues Raised by the 1978 IAEA Safety Mission (March 1979, Manila).
1927 187 OPE review which examines seismic and related technical issues based primarily upon information in the above two documents (July 1979).
31 Submissions of the petitioners and respondees whose comments on the PNPP-1 export, inter alia, are reviewed in Appendix 1 of this paper.
The PUNO Commission Report, which examined seismic, volcanolog-ical, and related safety issues and concluded that there was
" reasonable assurance that any occurrence of (seismic or volcanic) events, by itself, will not cause leakage or spillage resulting in nuclear contamination."
The reports of the two consultants to the PUNO Commission.
The State Department analysis prepared pursuant to E. O. 12114 which, based upon its review, indicated the judgment of the Executive Branch was that "... the proposed export will not be inimical to the common defense and security."
Despite the considerable body of information at hand on geologic hazards and the small likelihood that a follow-on proceeding would produce fundamentally new information, it could be argued that a
second proceeding is desirable in order to allow participants an additional opportunity to address specifically the merits of the technical issues posed by the Philippine export.
Indeed, some participants may assert that they had been denied the opportunity to submit technical information to the Commission on the Philippine applications if a second phase is not held.
In this regard further proceedings might be beneficial in that conflicting asser-tions based upon the mass of available information would be measur-ably narrowed through examinations of expert. witnesses -- but at the cost of postponing a decision.
OPE believes that the Commission can decide that it has sufficient information on which to base its inimicality determination without conducting a phase 2 proceeding and can make the statutory finding of non-inimicality.
If you agree, you would be in a position to decide on license issuance upon receipt and review of the staff's analysis and recommendation of the applicability of the NNPA export criteria to these cases.
OPE does not believe that, with regard to the Philippine applica-tions, a case has been made to justify a conclusion by the Commis-sion that it cannot make the required finding of non-inimicality.
To be sure, all uncertainties about the seismic, volcanological, and geotechnic features of the Napot Point site have not been com-pletely resolved.
However, the weight of the evidence did, in
- fact, persuade the Puno Commission, supported by its consultants, that there is reasonable assurance that the largest postulated earthquakes felt at the plant site would not result in nuclear contamination.
Indeed, while noting the need for better seismic data, Dr. John Kelleher has stated and reiterated in his commentary on the Stepp and Lomnitz reports that the likelihood of exceeding the high value of seismic design is definitely low but not neces-sarily remote.
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32 OPE recognizes that Commission agreement with this conclusion could reault in the establishment of a dual standard for reactor licensing -- domestic and foreign -- but believes that a number of factors justify such an approach.
First, given the legal conclusion above that the dearth of legis-lative guidance permits the Commission to treat health, safety, and environmental impacts on Americans abroad from a policy perspective, there is no statutorily compelling reason why there must be a single licensing standard.
Second, absent an ability to monitor the construction and actual operation of foreign reactors, any NRC safety review would, of necessity, be incomplete.
Under no foreseeable circumstance would we have the degree of confidence in a reactor's safety that exists domestically.
In this regard, it is important to note the practical difficulty of eliciting definitive NRC staff conclusions, given its position that conclusions on adequacy of plant design site safety could only be reached after a review comparable to that conducted for a domestic reactor.
Finally, in the Philippine case, it is an open question whether a negative conclusion on site safety would be reached even if such technical measures as the installation and two-year monitoring of a seismic network were undertaken.
Indeed, as the Kelleher commentary has pointed out, the data obtained from such a network might well provide a degree of confidence comparable to that which would be required for a domestic reactor.
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Appendix I
SUMMARY
AND ANALYSIS OF PARTICIPANTS' VIEWS The following is a summary of the major arguments advanced by the participants in the proceeding.
In order to avoid repetition, we have not included the views of each participant or each of the issues specified in the Commission Order.
Question 1: Whether (and if so, to what extent) the Commission possesses the legal authority or a legal obligation to examine the health, safety and environmental impacts of an exported nuclear facility in reaching
, irs licensing determinations (specifically, which of the seven issues raised by Petitioners are appropriate for Commission review) ?
The Department of State on behhlf of the Executive Branch, citing the Commission's Edlow and Babcock and Wilcox decisions, takes the position that the Commission generally lacks authority to consider health, safety and environmental impacts that would occur in the recipient country as a result of a United States nuclear export.
However, the Department recognizes that the Commission before issuing an export license must determine that the export would not be inimical to the common defense and security of the United States or to t.he health and safety of the American public.
The Department believes this statutory criterion authorizes the Commis-sion to examine health, safety and environmental factors to the extent that they may affect the " global commons," impacts which have already been addressed in the final environmental statement entitled, "U.S. Nuclear Power Export Activities" [ERDA-1542 (1976)].
The Department also asserts that the Commission may examine health, safety and environmental effects occurring in a foreign country if the impacts are so great that they threaten (1) U.S. relations with a recipient country or (2) jeopardize important U.S. security or defense interests.
The Department of State recognizes that the Commission must make an independent determination whether the risks in a particular situation warrant such a review.
Citing its foreign policy responsibilities and expertise, the State Department asserts that the Commission should be guided largely by the Executive Branch judgment on whether the risks rise to such a level.
In the Philippine matter, the Executive Branch, after preparing an environmental assessment consistent with the terms of E.O. 12114, has concluded that the Philippine exports would not be inimical to the common defense and security or consti-tute an undue risk to the public health and safety.
The Depart-ment of State argues that 1927 190
2
. while the scope for an Executive branch negative
~
finding based on health, safety or environmental risks is limited, as a substantive matter, to the same common defense and security ground as available to the Commis-sion, the Department has more latitude to review environmental, health or safety considerations as a procedural step before taking action on an export license application.
The Atomic Energy Act requires that the Executive branch complete its judgment on whether issuance of the license will be inimical to the common defense and security within 60 days, but the Secretary of State is given discretion to waive the time requirement if it is in the " national interest".
42 U.S.C. 2155(a)(1).
This discretion, coupled with his authority to address other factors in addition to the specified export criteria, provides latitude to review environmental, health or safety considerations.
It may be in the " national interest" to delay action on an export license application while reviewing these factors within the Executive branch and with concerned foreign nations, even if it may not.be " inimical to the common defense and security" to permit the issuance of an export license application.
This procedural auth-ority to address environmental, health or safety con-siderations where they relate to the common defense and security is not available to the Commission.
(Depart-ment of State submission at 10-11.)
The NRC staff asserts that the Commission's jurisdiction over health, safety and environmental matters is limited to a considera-tion of impacts affecting the United States public or the " global commons."
It concludes that the only issue raised by the peti-tioners which the Commission has jurisdiction to consider are
" risks to the effective operation of U.S. military installations in the Philippines."
Other participants took a broader view of NRC jurisdiction.
The Natural Resources Defense Council, Sierra Club, and Union of Concerned Scientists (hereinafter "NRDC, et al.") in a joint comment took the position previously rejecteH by the Commission in Babcock and Wilcox that the National Environmental Policy Act (NEPA) requires the Commission to prepare an environmental impact state-ment assessing the impact of proposed reactor exports.
et al. also stated that there could be little dispute that NRDC, EHission has the authority to examine health, safety and the Co environmental impacts occurring outside the United States which could affect the U.S. public.
NRDC begins its argument by citing the Senate Committee Report on the Nuclear Non-Proliferation Act of 1978.
In discussing the " inimical to the common defense and security or to the public health and safety" licensing requirement, the. Report stated:
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3 Although the NRC finding on the health and safety of the public refers only to the American public, it should be recognized that certain overseas activi-ties could pose a threat to Americans.1/
This statement is significant in two respects.
Fir s.t, it is an indication that the Congress expected the Cocmission to consider in its export licensing decisions effects which would occur in a foreign country, but might have an impact on the American public.
However, it also suggests in our view that Congress did not con-template a review of impacts in the recipient nation which would not affect the American public.
NRDC argues that recent events have also undermined the Commission's reasoning in Babcock and Wilcox.
NRDC notes that the Babcock and Wilcox opinion is based in large part on the principle of " comity among nations," and the Department of State's position that a health and safety review would have severe, adverse foreign policy NRDC asserts that E.O. 12114 represents a change in consequences.
the Executive Branch position and that the Executive Order:
recognizes the responsibility of the United States to ensure that its exports and activities abroad do not unreasonably harm the health for foreign citi-zens and the environment of other nations (NRDC comments at 7).
NRDC thus argues that t.0.12114 reflects an Executive Branch determination that legitimate foreign policy considerations support, rather than oppose, review by government agencies of the foreign effects of U.S. nuclear exports.
NRDC also cites a May 12, 1979 letter from Secretary of State Vance to Senator Church, explaining why the Executive Branch had not yet provided its views to the NRC on the Philippine reactor application which declares:
. I feel that we would be remiss in our respon-
..sibility if we were to approve any exports from the United States without consideration of hazard that might accrue from such exports.
NRDC then discusses at length why the proposed Philippine exports would have an impact upon the United States common defense and security and the health and safety of the American public.
NRDC 1/
S. Rep. No.95-467, 95th Cong., 1st Sess., at 13.
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n 4
notes that two important U.S. military bases are located within 40 miles of the Napot Point reactor sites and that evacuation of the military personnel might be required if an accident were to occur at the site.
Radioactive releases from the plant could also contaminate the bases, rendering them unusable for an indefinite period of time.
NRDC argues that, more importantly, an opera-tional failure at the plant would have severe adverse foreign policy implications because the Philippine people view the reactor as an American project, and that the U.S. would be blamed for any accidents.
NRDC notes that the Napot Point reactor is the largest construction project ever undertaken by the Philippines and is primarily financed by the U.S.
Government.
NRDC asserts that because of the heavy U.S. involvement, an accident could jeopard-ize relations with the Philippine Government and could conceivably lead to a termination of U.S. base rights.
NRDC also argues that a primary goal of the Nuclear Non-Proliferation Act is to make the United States c " reliable supplier"; and that an essential respon-sibility of a reliable supplier is to assure that exported reactors are safe.
Finally, NRDC argues that the Atomic Energy Act requires the United States Government to assure that the more than 30,000 Americans residing near the proposed reactor site are not harmed by the proposed export.
Senator Pell took an approach, similar to NRDC's, arguing that the Commission has jurisdiction to examine impacts that occur abroad because of the adverse foreign relations impacts that could result from an accident.
He stated that the United States would be severely criticized if an accident occurred and raised the possibility that claims might be filed against the United States for compensation, for aid in clean-up operations and for damage repair.
Congressman Dellums also submitted a letter arguing that the Commission has jurisdiction to consider health and safety impacts in the Philippine case because of the 33,000 Americans residing near the military bases.
On a broader basis he also argues that the fallout from a substantial nuclear mishap has the potential for damage on such a large scale as to affect not only the recipient nation, but also the U.S.
The Philippine Moyement for Environmental Protection (PMEP) mentioned many of the arguments made by NRDC et al., but also advanced a novel theory.
PMEP argued that the Agreement for Cooperation between the United States and the Philippines provides for the exchange of information and site visits, and that these provisions confer jurisdiction upon the Commission to review impacts arising from the proposed exports.
The Campaign for a Nuclear Free Philippines also argued that E.O.
12114 and the presence of U.S. military bases in the Philippines conferred jurisdiction upon the Commission to conduct the health and safety review requested by petitioners.
~
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5 The Friends of the Filipino People and the Coalition Against Reactor Exports took a broad view of the Commission's jurisdiction, arguing t'aat the NRC should examine impacts not only on the U.S.
The submis-mili;ary bases, but also upon the Philippine people.
sion of these groups asserts that U.S. common defense and security is enhanced by retaining good relations and friendship with the The Concerned Citizens Reactor Export Review Philippine people.
Section 2 Board advanced these same arguments and also argued that of the NNPA confers jurisdiction on the Commission to examineThat health, safety and environmental effects occurring abroad.
section provides that it is the policy of the United States to
" cooperate with foreign nations in identifying suitable technolo-
... to nuclear gies for energy production and... alternatives... consistent with the eco power those nations and environmental protection."
The National Lawyers Guild, Seattle Chapter, and the Interfaith the Commission has Center for Corporate Responsibility argued that moral and ethical responsibilities to review the impacts arising from the proposed export.
Other commenters, primarily from the nuclear industry, argue that the Commission lacks jurisdiction to consider the health, safety, The. Government of and environmental impacts of reactor exports.
the Philippines (National Power Corporation), citing the Commis-argued that the sion's Edlow and Babcock and Wilcox opinions, Commission is devoid of jurisdiction to consider impacts occurring in the Philippines.
The Philippine Government added that the health and safety questions raised by the petitioners fell within its jurisdiction and made clear that an NRC review of such issues would constitute an unwarranted intrusion into Philippine internal affairs.
The Philippine Government asserted that the only issues raised by the petitioners which the NRC had jurisdiction to consider were the unresolved generic safety questions pertaining to Westinghouse reactors.
Westinghouse -- the license applicant here -- also took the position that the Commission lacked jurisdiction to consider the health Westinghouse and safety questions raised by'the petitioners.
cited favorably the Commission s Edlow and Babcock and Wilcox opinions, particularly those portions pertaining to the extra-Westinghouse noted f territorial application of U.S. law.
that the Federal Register notice published by the NRC announcing receipt of the Philippine reactor application and inviting inter-vention petitions explicitly stated:
!h2[
lh4 In its review of applications solely to authorize the export of production or utilization facilities, the Nuclear Regulatory Commission does not evaluate
6 the health and safety characteristics of the facility to be exported. 2./
Westinghouse also argues that an NRC health and safety review would be inconsistent with the NNPA goal of making the United States a reliable supplier because such reviews would sub.stan-tially harm the competitive position of U.S. nuclear exporters vis-a-vis vendors from other nations who are not encumbered by procedures which recipients view as intruding upon their sover-eignty.
Moreover, Westinghouse asserts that Congress never authorized the NRC to review foreign health, safety and environ-mental matters in making ir.s required common defense and security /
public health and safety finding.
Westinghouse argues that it is ludicrous to
... make the determination of the Commission's juris-diction turn on the location of a proposed power plant vis-a-vis the happenstance of an American military base near the facility.
Those foreign nations who are allies of the U.S. and where we maintain military bases, would be most affected, while those foreign countries in which we maintain no military presence would be subject to no
.ommission review of health, safety and environmental aspects of proposed nuclear export.
Thus the most harm from adoption of any such jurisdictional base would occur in U.S. relations with its closest allies.
It would be an absurd result for the Commission to assert jurisdic-tion of health, safety and environmental issues in nuclear power export cases in those instances where power plants are proposed to be located near U.S. bases overseas, while at the same time denying such jurisdiction where the proposed power plants are not to be sited near U.S.
bases.
Finally, Westinghouse argues that the NRC is not legally required to take environmental impact documents prepared pursuant to E.O.
.12114 into account.
Westinghouse argues the Order may be uncon-stitutional because the purported legal bases for the Order, NEPA, the Marine Protection Research and Sanctuaries Act, and the Deep Water Port Act, were not meant to have extraterritorial application.
With respect to the " independent authority" of the President to issue such an order, Westinghouse claims the Constitutional doctrine of separation of powers precludes legal issuance of such an order.
Ebasco Services -- the film which designed major portions of the Philippine facility -- also argues that the Commission is devoid of foreign health and safety jurisdiction, asserting that the SI 41 Fed. Reg. 56895 (date).
1927 195
7 presence of the United States military bases in the Philippines "does not transform the Philippine Islands into the United States for purposes of the Commission's statutory authority."
Ebasco further states that the Philippine Atomic Energy Commission is a competent, professionally staffed egency with full and complete jurisdiction and authority concerning health and safety considera-tions.
Ebasco argues that if the NRC decides to examine health and safety impacts arising from the proposed export, it is in effect declaring that the Philippine Government is incapable of determining What is in the best interests of its people in the sphere of health, safety and environment.
The General Electric Company reached a sim'ilar conclusion.
GE argues that the extra-territorial application of domestic legis-lation should not be lightly presumed.
It argues that an expan-sive view of U.S. jurisdiction not only treads upon the sovereignty of foreign nations, but also lacks legal authority under the Atomic GE asserts that the national security criteria set Energy Act.
forth in that act pertain only to safeguards and non-proliferation issues.
GE adds:
As a matter of law, E.O.12114 is not applicable to NRC export licensinp, Jacisions.
The plain language of 5 126b(1) of the AEa precluded the application of Sec-any licensing criterion not mandated by statute.
tion 126c sets forth the sole means by Which additional licensing criteria may be created -- by joint resolution of the Congress.
The President cannot, by Executive Order, either require or authorize NRC to apply an extraterritorial health, safety or environmental criterion in its export licensing determinations.
GE further argues that Congress was aware of the NRC's Edlow and Babcock and Wilcox opinions at the time it enacted the UNPA, and that there is nothing in that act that alters the NRC jurisdic-tion with respect to health, safety and environmental matters or otherwise leads to a result contrary to that reached in the Com-mission's pre-NNPA decisions.
GE also argues that the presence of Americans abroad does not expand United States jurisdiction, and that the presence of U.S.
military bases in a given country does not grant the NRC juris-diction to consider foreign impacts.
GE asserts that if the presence of a U.S. military base, with its contingent of American citizens, confers the NRC with health and safety jurisdiction, countries Which object to U.S. health and safety reviews would be given a choice of either not purchasing U.S. reactors or not GE does not permitting U.S. military bases in their country.
believe countries should be given this choice.
GE also argues that there is no legislative history indicating that the NRC is 1927 196
8 to speculate on the impacts exports would have on U.S. military bases.
The Atomic Industrial Forum (AIF) also argues that the Commission lacka jurisdiction to consider petitioners' concerns.
The AIF asserts that health and safety reviews should only be conducted pursuant to bilateral or international agreements in which the recipient country has given explicit consent to such reviews.
Question Two:
Is the Commission's health, safety or environ-mental review of export license applications limited to the connection of these issues with the U.S.
common defense and security or are there other legal principles which permit or require the Commission to examine these matters as part of its liceneing review?
The only legal authorities cited by the participants were the Atomic Energy Act, NEPA and E.O. 12114,.all of which are discussed in the summary of responses on issue one.
Questica Three:
What issues arising from the application to export a nuclear facility to the Philippines should the Commission examine in any further proceeding?
Of course, the petitioners reiterated their request that the Commission examine each of the sevet: issues they raised.
They also urged the NRC to request the United States Geological Survey to pcrform a comprehensive analysis of the geologic and seismic hazards posed by the proposed reactor site.
In their view, Westinghouse should also be asked to submit to the NRC a complete assessment of the site hazards and how the reactor has been designed to withstand these risks.
The Coalition Against Reactor Exports requests the Commission to receive evidence on: (a) seismic and geologic risks, (b) adequacy of the reactor design, (c) the impacts that would arise from radioactive releases resulting from an accident, and (d) whether a nuclear reactor is a suitable technology for producing energy in the Philippines.
Senator Pell believes the Commission should examine risks to U.S.
personnel in the Philippines and also the adequacy of emergency planning.
I927 l97
9 The Coordinating Council, Federation for Environmental Concern, requests the Commission to consider:
(a) the safety of the site --
seismic and geological risks, (b) safety of the reactor, (c) capa-bility of the Philippines to operate the plant, (d) whether Philippine authorities have the ability to cope with an emergency, (e) whether the Philippine Government has sufficient political stability to ensure safe operation, and (f) whether the Philippine Government has adequately addressed waste disposal issues.
Other public interest groups participating in the proceedings (Campaign for a Nuclear Free Philippines, Concerned Citizens Reactor Export Review Board, NRDC, et al., the Friends of the Filipino People, the Philippine Movement for Environmental Pro-tection) also requested the Commission to review issues described above.
The NRC staff believes that any Phase II proceeding should be carefully limited to avoid intrusion into Philippine sovereignty.
The staff believes the best approach would be to limit any review to:
(a) the Philippine Atomic Energy Commission's conclusions, (b) the Puno Report, (c) the IAEA safety mission report, (d) the September 29, 1979 environmental assessment prepared by the Department of State, and (e) documents challenging or supporting these reports.
The Commission might also wish to balance the health and safety risks posed by the reactor upon the U.S. military bases with the adverse political consequences should the export licenses be denied.
Staff also suggests that the Commission may wish to consider the effect of its domestic licensing " pause" upon it' export licensing actions.
The Department of State believes that any additional proceeding should be limited solely to reviewing the Executive Branch judg-ment that the proposed export would not be inimical to the common defense and security of the United States.
The nuclear industry (Westinghouse, AIF and Ebasco) do not believe additional proceedings are required.
4 1927 NB
10 Question Four : If health, safety and environmental as3ects of a U.S. supplied nuclear facility are to 3e evaluated in the NRC export licensing process, in what sDecific manner should this review be conducted differently from the Commission!: domestic reactor licensing proceedings?
Should the scope of review be different, and if so, in what precise way?
Once again, a wide spectrum of views was expressed by partici-pants on this issue.
The Coordinating Council, Federation for Environmental Concern suggested that the NRC review should be more comprehensive than its domestic reviews because of the limited technological expertise possessed by developing countries.
Senator Pell, Friends of the Filipino People, Center for Develop-ment Policy, and Philippine Movement for Environmental Protection suggested that the NRC review should be similar, if not identical to, the review of domestic applications.
NPDC suggested 2 framework for NRC reviews tailored to the export process.
Under the NRDC approach, the NRC staff would prepare a health, safety and environmental review of the proposed reactor design, site suitability, and radioactive. waste issues.
Enviren-mental impacts resulting from the construction and normal opera-tion of the plant, as well as emergency planning, would be fully analyzed to the extent they impact upon the United States and U.S. citizens.
The staff review would thus be more limited than a domesrte license review because issues such as need for power, alternacive forms of electrical operation, the impact of construc-tion upon local residents, and alternative sites would not be examined by the NRC.
The NRC's reactor design review would seek to determine where the design varies from applicable NRC design criteria, regulatory guidelines, and branch technical iasuances.
If variances were identified, the NRC staff would determine whether the proposed design provided an identical Icvel of protection.
If not, the staff would prepare an assessment of the resulting health and safety risks.
The staff would also identify which generic unresolved safety problems apply to the proposed export and assess the health and safety risks posed by these unresolved probleins.
Under the NRDC approach, NRC staff review of site suitability would focus on geological, seismological, or meteorological hazards and the adequacy of design response.
The staff would also evaluate waste disposal plans or options and the risks of each possible approach.
Based on this information, the NRC staff would determine whether the proposed facility export poses unreasonable risks to the health and safety of the pubile or the environment.
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11 NRDC also suggests that the Executive Branch should require international verification of the capacity of the recipient government to carry out a sound regulatory program to assure safe operation of the reactor.
The Department of State believes that the NRC can satisfy all legal requirements by fully participating fn the Executive Branch health, safety and environmental assessments prepared pursuant to E.O. 12114.
This would avoid duplicating work performed by the Executive Branch.
In the Philippine matter, the Executive Branch believes that its September 28 submission adequately addresses the concerns raised by petitioners and others.
The NRC staff presented a series of options for Commission consideration.
The staff believes as a general matter that the more extensive reviews would produce the greatest body of infor-mation about the design and siting of a plant, and therefore permit a more confident assessment of overall plant safety.
However, staff emchasizes that no export license review, no matter how detailed, can restit in a 1cvel of assurance compa-rable to that of domestic reviews, which are coupled with other regulatory controls such cs quality assurance checks and follow-up inspections.
The staff believes that the more extensive the NRC review, the greater the intrusion into the sovereignty of the recipient nation and the greater the risk that NRC -- rather than the government of the reaipient nation -- will be viewed as the responsible authority for assuring safety.
Staff also notes that domestic licensing criteria are in a state of flux as a result of the Commission's response to the accident at TMI, and that this changing regulatory context could pose difficulties if export license reviews are modelled after the domestic reviews.
With these general observations in mind, staff outlined seven possible approaches to foreign health and safety:
(a)
Conduct the evaluation in a manner equivalent in detail and scope to the health, safety and environ-mental reviews performed by the staff in reviewing domestic reactor construction permit applications Such an evaluation would include review of the nuclear steam supply systems, the balance of plant, the site, and all inter-faces between these areas.
Staff estimates that each review would take a minimum of eleven professional man-years over a two-year period.
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12 (b)
Limited review of proposed exports Under this approach'the NRC would review the plant systems, design, and equipment proposed for export, but not the site.
This differs from alternative one in that an environmental impact statement, question and answer dialogue with the applicant, balance of plant review and site visits would be eliminated.
Upon completion of the limited review, the NRC would issue a letter of safety findings and recommendations.
Staff estimates such a review would require appro-ximately eight professional man-years, extending over a 1 to 2 year period.
(c). Review of assumptions, data and methodology used to match plant design to site characteristics This would involve determining whether previously identified site parameters (such as seismic and volcanic risks) have been treated in an acceptable manner from the engineeering standpoint.
Staff estimates that this would require four to six professional man-years extending over about a year period.
(d)
Assess findings of NRC experts temporarily attached to reactor projects to provide technical assistance to recipients nuclear regulatory authority The NRC would not perform its own independent review, but would draw upon the reports and judgments of technical staff members made available to the recipient on a continuing long-term basis.
The staff estimates that from 3 to 4 man-years per case over approximately two years would be required to implement this option.
(e)
Assess the nuclear safety capability of the recipient The NRC would assess the recipient's overall nuclear safety program.
Alternatively, the NRC could rely primarily on the IAEA to verify that the recipient possesses the necessary capabilities and applies appropriate safety standards.
(f)
Participate in the Executive Branch environ-)g2/
2())
mental review mandated by E.O.12114 This would assure that the NRC staff concerns would be transmitted to the recipient nation.
13 (g)
Offer to provide health, safety and environ-mental reviews if desired by the recipient country NRC would perform reviews only at the request of the recipient government.
The requestor would establish the scope of the NRC review.
The NRC staff is divided on which of these approaches should be aiopted by the Commission.
NRR concludes, based solely on tech-nical considerations, that option 1 (full review) is the only appropriate means for conducting foreign health and safety reviews for countries which have not demonstrated a capacity to operate reactors safely.
NRR believes that the other options will not provide enough information to the staff for it to be able to make a positive finding regarding safety.
IP finds disadvantages in each option, and particularly opposes options involving tae more extensive reviews because of the foreign policy implications, and time and resource requirements.
It does not believe that even an option 1 review could provide an assurance that the reactor will be operated safely over its projected lifetime.
It believes that the review should vary depending on the circumstances of the individual case.
IP recom-mends that on a case-by-case basis the Commission should consider the nature of health, safety and environmental issues in question, the capability of the recipient country to handle them, and only if necessary conduct a detailed but limited NRC review of selected documentation relevant to these issues.
IP recommends that the NRC staff review begin by analyzing the Executive Branch's assessment prepared pursuant to E.O.12114.
If NRC is satisfied with the document, no additional NRC review would be performed.
However, if careerns remained, staff could initiate its own review -- perhaps a combination of options 3 (review of assumptions, data and methodology) and 5 (assess nuclear capability of recipient).
In the rare case where questions remained after this review, staff could then perform an option 2 limited review.
Westinghouse believes that if the Commission determines that it possesses jurisdiction to consider foreign health and safety, NRC's review should be confined to assessing the recipient
~
nation's regulatory capacity.
This would be done by determining whether the recipient utilizes health and safety standards com-parable to those promulgated by the NRC or IAEA.
Westinghouse believes that use of such standards should be conclusive evidence of regulatory responsibility and that no further review is required where these standards are applied.
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14 The Atomic Industrial Forum believes that any such reviews should be done at the request of the recipient country.
The AIF is apprehensive that unilateral NRC assistance could be misconstrued as relieving the recipient nation of its responsibility to assure safety.
Question Five: What procedural format should the Commission adopt to examine any foreign health, safety and environ-mental risks falling within its jurisdiction?
The Center for Development Policy, et al. and the Committee Against Reactor Exports both urge tee Dommission to use full adjudicatory procedures.
The Center has specifically requested that the Commission waive the procedures set forth in Part 110, which adopt a non-adjudicatory format for export licensing hear-ings.
The Philippine Movement for Environmental Protection requests adoption of domestic licensing procedures, presumably adjudica-tory in character.
PMEP recommends that the U.S. and the Philippine Government jointly prepare an environmental impact statement and conduct joint hearings on the license applications.
Senator Pell recommends adoption of procedures which will assure that the Commission receives all relevant information.
He sug-gests the NRC adopt procedures which could enable the NRC to request an appearance of representatives of the Philippine Govern-ment-and its nuclear industry.
The Coordinating Council, Federation of Environmental Concern recommends that the Commission not act upon the application until the NRC ends its domestic licensing " pause".
NRDC, et al. suggests that the NRC staff prepare a health, safety and envfronmental review of the oroposed reactor export license.
(See discussion of issue four, a)ove.)
They recommend that af ter the review is published, the public be given 30 days to comment upon it.
The Commission would then consider the document, public comments, and any requests for an oral hearing on specified issues.
The Commission would then decide within 15 days whether to hold a hearing and would issue an order identifying the subjects to be addressed.
If the Commission decided to hold hearings, NRDC, et al. suggests that the hearing include receipt of testimony under oath and an opaortunity for cross-examination.
The Commission would ' appoint a searing board, with subpoena power, to conduct the hearings.
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15 The Department of State takes the position that if the Commission should conduct a hearing on substantive issues raised by the Philippine applications, a written hearing on an expedited schedule should be adopted.
The Department does not believe that oral argument would provide the Commission with information that could not be communicated equally well in writing.
The Department of State, after receiving.the Center for Development Policy comments which included the request that the Commission waive its regula-tions to permit adjudicatory hearings, submitted additional views to the Commission "strongly oppos[ing]" a waiver of the rules.
The NRC staff opposes the use of adjudicatory procedures and the Center's waiver request.
The staff believes that procedures set forth in Part 110 are adequate for the present proceeding.
The National Power Corporation, Westinghouse, Ebasco and the Atomic Industrial Forum also oppose use of adjudicatory procedures.
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