ML19312E918

Response in Opposition to Intervenor G Fernos 800430 Request for Issuance of Order to Show Cause Why Application Should Not Be Dismissed.No Time Frame Requirememts Exist for License Processing.W/Certificate of Svc

ML19312E918
Person / Time
Site:	05000376
Issue date:	05/19/1980
From:	Axelrad M LOWENSTEIN, NEWMAN, REIS, AXELRAD & TOLL, PUERTO RICO ELECTRIC POWER AUTHORITY
To:	Atomic Safety and Licensing Board Panel
References
NUDOCS 8006180158
Download: ML19312E918 (11)

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UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION

- USNRC f-93 W 2 21980 > 31 Office of the Secretuy BEFORE THE ATOMIC SAFETY AND LICENSING BOARD y UC Cy /

In the Matter of )

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PUERTO RICO ELECTRIC POWER )

AUTHORITY ) Docket No. 50-376

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North Coast Nuclear Plant, )

(Unit 1) )

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AUTHORITY'S RESPONSE IN OPPOSITION TO INTERVENOR'S PETITION Gonzalo Fernos (Intervenor), an intervenor in the above captioned proceeding, has served a document dated April 30, 1980 entitled " Petition Requesting Evidentiary Hearing to Request Applicant to Ghow Cause Why Their Application Should  ;

Not Be Dismissed for Lack of Intention to Build" (Petition).

The Petition alleges that Puerto Rico Electric Power Author-ity (Authority) has no intention of building North Coast Nuclear Plant and that the Authority has kept this fact secret "to prevent letting the revenue bond holders find out about the-heavy financial loss that the nuclear plant ill fated venture has inflicted upon the economy of Applicant."

Petition, p. 2. The Intervenor requests the Licensing Board "to set a date to conduct a show cause hearing in Puerto Rico not later than July, 1980" and "to issue order dismissing the above-captioned application with prejudice." The Intervenor I

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• , also requests that the Board assens the Authority "a damage sum of $10,000.00 on behalf of Intervenors for compelling us to litigate for five years a meaningless application."

Petition, p. 4. The Authority hereby submits its response in opposition to the Petition.

If the Petition is construed as a motion to dismiss the Authority's application foria construction permit, I it must be denied. A motion to dismiss an application for

. a construction permit "is not a proper motion under 10 C.F.R. 2.730. . . . [T]here is no procedure (short of withdrawal by the Applicant) for the disposition of such an application" without the hearing mandated by Section 189 of the Atomic Energy Act of 1954, 42 U.S.C. S 2239. Boston Edison Co. (Pilgrim Nuclear Generating Station, Unit 2),

LBP-75-15, 1 NRC 419, 420 (1975). In short, licensing boards have not been delegated the authority by the Commission to dismiss an application, / and "a Licensing Board is not required to respond to every ineffectual request for action made by a party, particularly when no provision therefor is contained in the Commission's Regulations." Boston Edison

!If the Intervenor intended that his petition be construed as a request to initiate a show cause proceeding pursuant i to 10 C.F.R. S 2.202, he has proceeded before the wrong forum. Under 10 C.F.R. S 2.206, a show cause petition must be addressed to the Director of Nuclear Reactor Regu- 1 lation, not to a licensing board.

-[It should be noted that we are not disputing the power of the Commission to dismiss an application for a procedural default by an applicant. See e.g., 10 C.F.R. S 2.108.

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. i Co., supra. See also Boston Edison Co. (Pilgrim Nuclear 1 Generating Station, Units 2 and 3), LBP-74-62, 8 AEC 324, 326 (1974).

Even if it is assumed that the Board has jurisdiction to consider the Petition on its merits, the Intervenor fares no better. As one licensing board stated when faced with a request to order an applicant to show cause why its construction permit application should not be dismissed, "an order to show cause is a remedial step in dealing with failure to meet required standards of conduct." Philadelphia Electric Co. (Fulton Generating Station, Units 1 and 2),

LBP-79-23, 10 NRC 220, 223 (1979). If a petition does not allege that the applicant has committed such a failure, it must be denied. I d_.

The Intervenor has made no such allegations against the Authority. He has not alleged that the Authority has engaged in any illegal wrongdoing, and he has not :.dentified any conduct of the Authority which is in violation of any regulation or statute. Since the Authority has not failed to meet the " required standards of conduct," the Inter-venor's petition must be rejected.

Although the Intervenor's petition can be dismissed for any of the foregoing reasons, we do not wish to leave the Board with the impression that the Intervenor's factual assertions are substantively valid. Therefore, we take this opportunity to address his allegations even though the

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• Board need not consider such matters to dispose of the Petition.

The Intervenor asserts that the Authority has dropped its intention to build the North Coast Plant and has hidden this fact to prevent bond holders from learning of the heavy financial loss which the Authority has allegedly incurred from this plant. He then proceeds to support his assertion with several different bases.

First, he allegbs that the Authority has not acquired ownership of all of the property which will eventually comprise the site, ! and that this evidences the Authority's intent not to build the plant. Although it is true that the Authority has not acquired the property, this fact has no bearing on the Authority's intentions with regard to the site. As a matter of simple economics, it makes little sense for the Authority to purchase the land, only to allow it to remain idle until such time as the Authority may determine to proceed. Also, it should be noted that, as a matter of law, there is no requirement that a proceeding be suspended because an applicant has not acquired ownership of the site. New England Power Co. (NRP, Units 1 and 2) ,

LBP-78-9, 7 NRC 271, 283 (1978).

Next, the Intervenor refers to the Authority's 1979

! The Intervenor states that "most of land" acquired for the site by the Authority has been returned to the original owners. This assertion is incorrect. The Authority has made the land available for reacquisition by the original owners but the owners have not chosen to take advantage .

of this offer. )

. Financial Statement as a basis for his assertion that the Authority has hidden the fact that termination of the plant would result in a loss of "$154,959,000." *:e are un-certain how the Intervenor derived the figure quoted above, but we note that he probably has misread the Financial Statement.

As is explicitly stated in the Financial Statement,

p. I-12, total costs incurred to-date with respect to the North Coast Nuclear Plant are $88,041,000, which includes both equinment and site and licensing costs. Of this amount, Sil,106,000 has been written down by the Authority in previou; years, and only $26,935,000 is included among the assets in the Authority's Statenent. Thus, the Inter-venor has misstated the amount of any potential " loss."

Also, it is difficult to understand how the Intervenor can allege that the Authority has " hidden" any financial inform-ation when it is obviously available in the very Financial Statement which he cites.

Finally, the Intervenor relies upon the fact that a committee of the National Academy of Science recommended that the next major addition to the Authority's generatinc capacity be a plant not exceeding 450 MWe, and that it recommended against constructing a nuclear plant at this time because its capacity would exceed 600 MWe and because it could not be installed within the necessary time frwae. l The Authority's present plans are in conformance with this 1

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. , recommendation, since, as we previously advised the Board and the parties, the Authority intends to build a 300 MWe coal-fired plant to satisfy its immediate needs for generating capacity. !

However, the Intervenor neglected to mention that, in the sentence of the recort immediately preceding the language quoted by the Intervenor, the National Academy of Science also recommended that "it would be advisable to preserve

, the nuclear option ab a possible component of Puerto Rico's future electric power system."-! The continuation of the instant application is intended to do just that, i.e., pre-serve the viability of the nuclear option until future planning decisions can be made.

To the extent that the Intervenor is suggesting that the application should be dismissed because it is presently inactive, the Petition should be denied. Numerous cases have indicated that a proceeding or an application cannot be dismissed on the ground that the applicant has decided to defer construction. For example, the Commission has refused to vacate a proceeding even though an applicant planned to defer an in-service date by two years. Wisconsin Electric Power Co. (Koshkonong Nuclear Plant, Units 1 and 2), CLI-75-2, 1 NRC 39, 42 (1975). Similarly, a licensing board denied a motion to force an applicant to withdraw its application

/ Status Report as of December 28, 1979.

- !Interim Report of the Committee on Future Energy Alterna-tives for Puerto Rico, p. 10.

. , though the applicant proposed to suspend the licensing process for two years. There is "no legal requirement for an Applicant to proceed with the processing of its application in acecrdance with any set time scale." Detroit Edison Co.

(Greenwood Energy Center, Units 2 and 3), LBP-75-56, 2 NRC 565, 567 (1975). In Potomac Electric Power Co. (Douglas Point Nuclear Generating Station, Units 1 and 2), ALAB-277,

{ l NRC 539 (1975), the Appeal Board sanctioned an evidentiary hearing after the applicant announced plans to defer construc-tion for four years. In fact, a licensing board has issued a partial initial decision in a construction permit pro-ceeding after being notified that the applicant planned to defer construction " indefinitely." Houston Lighting and Power Co. (Allens Creek Nuclear Generating Station, Units 1 and 2), LBP-75-66, 2 NRC 776, 779 (1975). The comrission's regulations contemplate the possibility of delays in prose-cuting applications of at least five to six years. See 10 C.F.R. S 2.606 (b) (2) . Thus, there is no requirement that prohibits holding an application in abeyance until such time as the applicant decides to proceed.

However, the Board need not refer to these cases in support of a denial of this Petition. The Board rejected a similar motion to dismiss from this very Intervenor just two years ago. To quote the Board:

Intervenors argue that there is no indication that the Applicant will ever submit a time-table for proceeding with its application. But

there is no requirement in any Commission's regulation or underlying statute that requires an Applicant to proceed with the processing of its application in accordance with any set time scale.

Puerto Rico Water Resources Authority (North Coast Nuclear Plant, Unit 1), Order, p. 4 (May 1, 1978). Consequently, it would be totally inappropriate and improper for the Board to dismiss the Authority's application solely because the Authority has continued to defer processing the application.

t The Intervenor's request for a hearing on this issue also lacks merit, The motion to dismiss can be denied on jurisdictional and procedural grounds, thus obviating any need for an evidentiary hearing. Moreover, the basis for the Intervenor's motion lacks any substance on it s face, as we have already shown. The facts presented with the Petition, together with all reasonable inferences, do not support the Intervenor's conclusion that the Authority has no intention of building a nuclear plant at the Islote site at a future date. The Intervenor has not come forward with sufficient allegations to warrant a hearing on this issue.

Finally, the Board should deny the Intervenor's request that a damage sum of $10,000 be imposed upon the Authority on behalf of the Intervenor. The Atomic Energy Act makes no provision for awarding damages to a party, and the Board is without jurisdiction to do so on its own authority.

Although the Commission may assess a civil penalty against a person under Section 234 of the Atomic Energy Act, 42 U.S.C.

e 5 2282, such a penalty is only authorized if that person has violated a license provision, the Act, a regulation, or an order. The Intervenor has not alleged that the Authority has committed an act which would subject it to a civil penalty under this section. In any case, such a penalty would not be awarded to the Intervenor. Moreover, the Commission has determined that it will not provide funds to intervenors in adjudicatory proceedings for the expenses they have incurred. Nuclear Regulatory Commission (Financial Assistance to Participants in Commission Pro-ceedings), CLI-76-23, 4 NRC 494 (1976).

Consequently, the Authority respectfully submits that the Intervenor's petition should be denied in all respects since it lacks merit both substantively and procedurally.

Respectfully submitted, M di fjg Maurice Axelrad, Esqu[$e LOWENSTEIN, NEWMAN, REIS, AXELRAD & TOLL 1025 Connecticut Avenue, NW Washington, D.C. 20036 DATE: May 19, 1980 i

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