ML19262A979
| ML19262A979 | |
| Person / Time | |
|---|---|
| Site: | Zimmer |
| Issue date: | 11/27/1979 |
| From: | Borgmann E CINCINNATI GAS & ELECTRIC CO. |
| To: | MIAMI VALLEY POWER PROJECT |
| References | |
| NUDOCS 7912110376 | |
| Download: ML19262A979 (24) | |
Text
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4 UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION \3 In The Matter of )
)
THE CINCINNATI GAS & ELECTRIC )
COMPANY, ET AL. ) Docket.No. 50-358
)
(Wm. H. Zine.er Nuclear Power )
Station) )
APPLICANTS' RESPONSES TO "INTERVENOR MIAMI VALLEY POWER PROJECT'S INTERROGATORIES TO APPLICANT REGARDING CONTENTION 13" November 27, 1979 1529 086 7012110 3.,7
'Interregatorr #1 Please specify each design construction, engineering, safety, quality, installation, or ot.ker problem contributing to the delay of the fuel loading date of the Zi=mer Station announced by CG6E in ; 33 f, 1979.
Reseense Objection Taken 1529 087
4 Interrocatorv d2 CG&E has stated that these delays will increase the total cost at the Zirmer project to SS50 Million, S186 Million beyond the previcus estimate. Please specify the means by which this additional money will be raised, (eg., stock issuance, loans, bcnd issuance, etc. ) . For each method empicyed, please specify quantities, amounts, interest races, and what percentage of the total increace in the Zimmer construction costs has been or will be obtained through each means identified.
Resoonse of CG&R of the SlS6 Million increase, S75.6 Million represents The Cincinnati Gas & Electric Ccmpany's share. Additional Allowance for Funds Used During Ccnstructicn will amount to S 20.6 Million and the balance of 555.0 Million represents addi-tional money that will have to be raised. -
Construction ecs:s for Zimmer Station are included in the overall requirements for capital and have been er will be financed as a part of CG&E's overall needs. In 1979, CG&E issued S100 Million of 10% first mortgage bonds to finance part of its construction program including Zimmer Station. The issuance of additional ccmmen stock through the Employee Incentive Thrift Plan, Empicyee Stock Ownership Plan and Dividend Reinvestment and Stock Purchase Plan is expected to provide an additional 510 Million in both 1979 and 1980. Presently, the Ccmpany is raising capital through the issuance of shcr -term debt obliga-tiens at interest rates ranging from 13% to 15-3/4%. Ecwever, this money has not been specifically raised for construction of the Zimmer S tation.
1529 088
Interrocaterv d2 - Resconse of CG&2 (continued)
Determination of future financings are subjec: to several facecrs, including the amcun and timing of rate increases ,
internal generation of funds, and the course of CG&E's construe:ica program. Present estimates indicate that CGas will sell approxi-mately S60 Million of commen stock in the first half of 1980 and S75 Million of first mortgage bends in the secend half of 1990.
It presently is expected that any additicnal capital which may be required in 1980 would be provided from short-term bank leans or the issuance of commercial paper. Prices and temms of these securities would be determined by the financial marke: at the time of sale.
1529 089
Response of C&SOE Of the S186 million increase, S53.8 million represents the Columbus and Southern Ohio Electric Company's share. Additional Allowance for Funds Used During Construction will amount to S16. 2 million and the balance of S37. 6 million represents additional
- money that has already been or will have to be raised.
Construction costs for Zimmer Station are included in the ovetell requirements for capital and have been or will be financed as a part of C&SOE's overall needs. In 1979, C&SOE issued $60 millien of 10-1/4% first mortgage bonds to finance part of its construction program including Zimmer Station. The issuance of additional common stock through the Employee Thrift Plan and Dividend Reinvestment Plan is expected to provide an additional S4.5 million in both 1979 and 1980. Presently, the Company is raising capital through the issuance of short-term debt obligations at interest rates ranging from 13% to 15-3/4%.
However, the Company does not identify any particular source of funds with specific construction projects, including the Zimmer S ta tion .
1529 090
Interrocatorv E2 - Resoonse of C&SOE (continued)
Determination of future financings are subject to several factors, including the amount and timing of rate in-creases, internal generation of funds, and the course of C&SOE's construction program. Present estimates indicate that C&SOE will sell approximately $40 million of securities to finance
' construction expenditures in 1980. The type of security and timing of sale have not been determined and will depend on the factors already mentioned, as well as market conditions at the time of sale. It presently is expected that any additional capital which may be required in 1980 would be prcvided from the sale of not more than $30 million of first mortgage bonds and from short-term bank loans. Prices.and terms of these securities would be determined by the financial market at the time of sale.
1529 091
Response of DP&L Construction costs for Zimmer Station are included in the overall requirements for capital and have been or will be financed Ts a part of DPOUs overall needs. In 1979, to finance part of its construction program including Zimmer $tation, DP&L issued $15 million of 9 % first mortgaga bonds, $45.0 million of 9 3/8% Series I pre-ferred stock, $30 million of 10 % first mortgage bonds, $48 nillion of pollution control obligations and approximttely $7.2 million will be raised through the issuance of common stock pursuant to CPOUs Employee Stock Plans and the Automatic Dividend Reinvestment and Stock Purchase Plan. In addition, the Company has filed a registration statement for the sale of $65 million of first mortgage bonds in December 1979.
Presently, DP&L is raising capital through the issuance of short-term debt obligarions at interest rates ranging from 14% to 15h%.
Other than the sale of $15 million of 10k% first mortgage bonds in January 1980 (arranged in August 1979) DP&L has not final-ized its 1980 financing program. Determination of future financings are subject to several factors, including the amount and timing of rate increases, internal generation of funds and the course of DP3L's construction program.
1529 092
Interrogator'1 43 Specify the schedule for amortization for each of above newly incurred debts for each applicant.
Response of CG&E' See Response to Interrogatory #2. Historically, CG&E's first mortgage bonds have been sold with thirty-year maturities.
Bank loans and commercial paper generally have maturities of 90 days or less.
Response of C&SOE See Response to Interrogatory 42. Historically, C&SOE's first mortgage bonds have been sold with maturities of anywhere from five to thirty years. Bank loans and other short-term debt instruments have maturities of 30 to 180 days.
Response of DP&L See answer to Interrogatory #2.
1529 093
Interrocatorv e4 Please specify any anticipated changes in the total amount of stock dividend payments for each of the next five years for each applicant.
RestJnse of CG&E Future dividends will depend upon CG&E's earnings and financial condition and the determination by CG&E's Board of Directors at the time of declaration.
Response of C&SOE Future dividends on C&SOE's common stock will depend upon C&SOE's earnings, financial condition and determination by the Board of Directors at the time of declaration.
Reseense of DP&L The timing of the issuance of additional shares of ccmmon stock for the nexr five years is not now determinable (see answer to Interrogator 142) . The dividend rata and any changes therein are determined by the Scard of Directors and depend upon varicus fac-tors such as future earnings and financial condition.
1529 094
Inter ccaterr e5 Please specify a revised schedule for amortication of the :=taa capital indebtedness incurred for each acclicant resulting from the construction costs at the v4 me7 Station.
Rescense S*' Response to Intarrogatories #2 and #3.
1529 095
Interrogatory #6 Please specify the amounts and the percentages of the increased costs mentioned above that has been or will be met by funds obtained by means of deferred inccme tax credits.
Response of CG&E Presently, total funds generated by means of deferred income tax credits are minimal as the Public Utilities Commission of Ohio has not allowed the use of such deferrals, including those which may be associated with construction costs, in determining CG&E's cost of service. Therefore, it can be stated at this time that it is anticipated that none of the increassi costs of con-struction will be met by funds obtained through deferred income tax credits.
Response of C&SOE Presently, total funds generated by means of deferred income tax credits are minimal. The Public Utilities Commission cf Ohio has allowed C&SOE the use of such deferrals since May 1978, based on plant facilities placed in service since January 1, 1977.
Therefore, C&SOE believes it can be stated that a minimal amount of the increased costs of construction vill be considered met by funds obtained through deferred income tax credits.
1529 096
Response of-DP&L Presently, total funds generated by means of deferred income tax credits are minimal as The Public Utilities Commission of Ohio has only allowed The Dayton Power and Light Company the use of such deferrals since January 1978, based on plant facilities placed in service since December 31, 1975. Therefore, DP&L believes it can be stated tnat a minimal amount of the increase in costs of construction could be considered met by funde obtained through deferred income tax credits.
1529 097
Interrogatory #7 Plear.e specify the amounts and percentages of the above mentioned costs to be met by funds obtained by means of construction work in progress (CWIP) charges. Please indicate if the availability of any of these anticipated revenues is still pending Public Utilities Commission of Ohio decisions.
Response of CG&E At the present time, CG&E has not obtained any funds by means of CWIP charges. Inclusion of Zimmer Unit #1 and certain other projects in CG&E's rate base as CWIP is currently pending before the Public Util2 ties Commission of Ohio in Case NO. 79-ll-EL-AIR.
Response of C&SOE At the present time, C&SOE has not obtained any funds by means of CWIP charges. Inclusion of ZLumer Unit #1 and certain other projects in C&SOE's rate base as CWIP is currently pending before the Public Utilities Commission of Ohio in Case No. 78-1438-EL-AIR.
Response of DP&L At the present time, DP&L has obtained minimal funds by means of CWIP charges. Inclusion of Zimmer Unit #1 and certain other projects in DP&L's rate base as CWIP is currently pending before The Public Utilities Commission of Ohio in Case No. 79-510-EL-AIR.
1529 098
Interrocatorv *8 Please specify a revised schedule for payment of Octal deferred income cz:c obligations resulting from the costs of construction at the Zi==er Station for each applicant.
Resconce of CG&E As noted in our response to Interrogatory #6, CG&E presently has no deferred income tax obligauions resulting frem the costs of construction at the Zimmer Station. As such, there is no re=ayment schedule. '
Response of C&SCE
, As noted in our response to Interrogatory #6, C&SOE presently has no deferred income tax obligations resulting from the costs of construction at the Zi=mer Station, becaQse that Station is not yet in service. Thus, there is no repay-ment schedule.
Resconse of DP&L It is anticipated that any deferred inccme taxes resulting from the costs of construction at the Zimmer Station would be reflected in the rates charged to the custcmer over the tax life of the property.
1529 099
I2.terrogatory #9 Please identify probable and reasonable sources of revenue for paying the above specified deferred income tax obligations for each applicant.
Response of CG&E As noted in our response to Interrogatories #6 and #8, CG&E presently has no deferred income tax obligations resulting from the increased cost of construction of the Zimmer Station.
Response of C&SOE As noted in our response to Interregaizries #6 and #8, C&SOE presently has no deferred income tax obligations resulting from the increased cost of construction of the Zimmer Station.
Response of DP&L The source of any revenues that are or may be granted by the applicable regulatory agency for deferred income taxes would be reflected in the rates charged to the Company's customers.
1529 100
Interrogatory #1D Please state, in a clear affirmative or negative declarative statement, whether funds from CWIP charges on current, planned, or futuro construction will be or are anticipated to be used in meeting some deferred income tax obligations.
Response of CG&E Seu response to Interrogatory #7.
Response of C&SOE As noted in the response to Interrogatory #7, at the present time no funds are being generated by the inclusion of CWIP in C&SOE's rate base. .
Response of DP&L It is anticipated that deferred income tax costs that would be included in rates would be recovered through revenues.
See answer to Interrogatory 57._
i529 101
Interrogatory #1~
Identify and estimate for each of the first 5 years of operation any increases in labor costs, fuel costs, fuel recei.ving, loading, storage or disposal costs, maintenance costs, materials costs, equipment costs, or other operating costs which result from the problems identiiied in the answer to question #1. Please attach a revised operations and maintenance cost schedule.
R esconse There are no cost increases expected in the areas of fuel receiving, loading, or storage resulting from the delay of the fuel loading date of the Z4- er Station. Labor and material equipment costs are expected to increase due to the project delay. The increases will be primarily a result of inflation. A schedule of the estimated operation and maintenance. costs is presented below:
Year Of Operation And Operation Maintenance Costs *
(Dollars) 1 34,413,459 2 35,703,382 3 41,064,506 4 41,495,323 5 43,963,766
- Includes nuclear fuel expenses, and operating and maintenance expenses.
1529 102
Interrocatorv #12 Identify and estimate for each of the first 5 years of operation all equipment, safety security, operating and maintenance cost increases resulting from NSC or Kemeny Co= mission recommendations or requirements stemming from the Three Mile Island investigations.
Resconse The cost increases due to additional NRC requirements will be expended, in large part, prior to the receipt of an operating license.
At this tise it is not possible to estimate the increases in the cost of operation, including additional training and manpower, if any, that might be required during the first 5 years of Zimmer operation stemming from the Three Mile Island investigations.
1529 103
Interrocatorv 413 Estimate in dollar amounts, a revised schedule for depreciation costs for the Zimmer Station plant and equipment as they have been, are being, or will be presented to the Internal Revenue Service in computations of the fedaral income tax obligations of each applicant for the anticipated service- life of the Zimmer Station.
Resconse of CG&E The following estimates of annual depreciation to be claimed
, by CG&E on its federal inccme tax return are based upon current depreciation regulations of the Internal Revenue Code. Actual amounts may vary depending upon final costs and future federal inccme tax legislation.
Year Cecreciation S
1 31,493,400 2 27,545,875 3 24,094,503 4 21,076,587 5 18,437,436 6 16,136,190 7 14,122,599 8 12,360,707 9 10,791,588 10 10,791,588 11 10,791,588 12 10,791,588 13 10,791,588 14 10,791,588 15 10,791,588 16 10,791.587 To tal 251,600,000 1529 104
Response of C&SOE
. The following estimate of annual depreciation to be claimed by Columbus and Southern on its Federcl Income Tax return is based on current depreciation regulations of the Internal Revenue Code. Actual amounts may vary depending on final cost and future Federal Income Tax legislation.
Year Deoreciation 1 S 22,425,000 2 19,621,875' 3 17,169,141 4 15,022,998 5 13,145,123 6 11,501,983 7 10,064,235 8 8,906,206 9 7,705,429 10 7,705,430 11 7,705,430 12 7,705,430 13 7,705,430 14 7,705,430 15 7,705,430 16 7,705,430 To tal S179.400,000 1529 105
Response of DP&L The Company's share of the estimated depreciable costs
($198,135,000) for the Zimmer project will be recovered in accord-ance with the prevailing tax law and regulations implementing the same, which law and regulations are subject to change from time to time by Congress cad the Internal Revenue Service. In addition, die regulatory treatment to be accorded such costs may also change.
The following summarizes the annual depreciation of the Zimmer Station which will be claimed by DP&L on its federal income tax return beginning in the year the station is placed in service.
Year Depreciation 1 S 24,766,875 2 21,671,016 3 18,962,139 4 16,591,871 5 14,517,887 6 12,703,152 7 11,115,258 8 9,725,850 9 8,510,119 10 8,510,119 11 8,510,119 12 8,510,119 13 8,510,119 14 8,510,119 15 8,510,119 16 8,510,119 Total S198,135,000 1529 106
VERIFICATION State of Ohio )
) ss County of Hamilton )
Earl A. Borgmann, being first duly sworn, states that he is Senior Vice President for The Cincinnati Gas &
Electric Company; that he has been duly authorized to exe-cute, verify and file the foregoing document " Applicants
Responses to 'Intervenor Miami Valley Power Project's Inter-rogatories to Applicant Regarding Contention 13'"; that he has read the contents of same and that the statements con-tained therein are true and correct to his best information, knowledge and belief.
b f- 0 s n Earl A. Borgmann Subucribed and sworn to before me this 27th day of November, 1979.
h[L: & f)f.. /jfl
& Notary Public #
VIRGIfe4 P. MUHLHCFER NChtY Pubbc, $bte Cl 3hio My Commission Ecirts Jdy 23 U82 1529 107
UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION In the Matter of )
)
THE CINCINNAT GAS & ELECTRIC )
COMPANY, ET AL. ) Docket No. 50-358
)
(Wm. H. "immer Nuclear h,wer )
Station) )
CERTIFICATE OF SERVICE I hereby certify that copies of " Applicants' Responses to 'Intervenor Miami Valley Power Project's Interrogatories to Applicant Regarding Contention 13'", dated November 27, 1979, in the captioned matter, were served upon the following by deposit in the United States mail this 27th day of November, 1979.
Charles Bechhoefer, Esq. Dr. Lawrence R. Quarles Chairman, Atomic Safety Atomic Safety and Licensino and Licensing Board Appeal Board U.S. Nuclear Reculatory U.S. Nuclear Regulatory Commission Commission Washington, D.C. 20555 Washington, D.C. 20555 Dr. Frank F. Hooper, Member Michael C. Farrar, Esq.
Atomic Safety and Licensino Atomic Safety and Licensino Board Appeal Board School of Natural Resources U.S. Nuclear Reculatory University of Michigan Commission Ann Arbor, Michigan 48109 Washincton, D.C. 20555 Mr. Glenn O. Bright, Member Chairman, Atomic Safety and Atomic Safety and Licensing Licensino Board Panel Board U.S. Nuclear Regulatory U.S. Nuclear Regulatory Commission Ccmmission Washington, D.C. 20555 Washincton, D.C. 20555 Richard S. Salzman, Esq. Chairman, Atomic Safety and Chairman, Atomic Safety and Licensing Appeal Board Panel Licensing Appeal Board U.S. Nuclear Regulatory U.S. Nuclear Regulatory Commission Commission Washington, D.C. 20555 Washington, D.C. 20555 1529 108
Charles A. Barth, Esq. William Peter Heile, Esq.
Counsel for the NRC Staff Assistant City Solicitor Office of the Executive City of Cincinnati Legal Director Box 214 U.S. Nuclear Regulatory Cincinnati, Ohio 45202 Commission Washington, D.C. 20555 Troy B. Conner, Jr., Esq. Leah S. Kosik, Esq.
Counsel for The Cincinnati Attorney at Law Gas & Electric Company 3454 Cornell Place Conner, Moore & Corber Cincinnati, Ohio 45220 Suite 1050 1747 Pennsylvania Avenue N.W.
Washington, D.C. 20006 Mr. Chase R. Stephens John D. Woliver, Esq.
Docketino and Service Section Clermont County Community Office of the Secretary Council U.S. Nuclear Regulatory Box 181 Commission Batavia, Ohio 45103 Washington, D.C. 20555 Wifliam J. Mor
/
1529 109