ML19323C680

Motion by PA Public Util Commission to Compel Met Ed to Produce Certain Documents in Response to Discovery Request 6,re Cash Flow Studies Since 790129.Studies Are Major Tool in Addressing Util Financial Ability.W/Certificate of Svc

ML19323C680
Person / Time
Site:	Three Mile Island
Issue date:	04/17/1980
From:	Levin J PENNSYLVANIA, COMMONWEALTH OF
To:	Atomic Safety and Licensing Board Panel
Shared Package
ML19323C676	List: ML19323C675 ML19323C680
References
NUDOCS 8005160486
Download: ML19323C680 (7)

Text

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O s oo,I,o ggy Cr -

UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD In the Matter of )

)

METROPOLITAN EDISON COMPANY ) Docket No. 50-289

) (Restart)

(Three Mile Island Nuclear )

Station, Unit No. 1 )

MOTION OF PENNSYLVANIA PUBLIC UTILITY COMMISSION TO COMPEL METROPOLITAN EDISON COMPANY TO PRODUCE CERTAIN DOCUMENTS Pursuant to 10 CFR $2.740(f) Motion to Compel discovery and 10 CFR $2.718(b) Power of Presiding Office (subpoenas) the Pennsylvania Public Utility Commission moves to compel appro-priate response to our Discovery Request No. 6, as supplemented by our letter of March 26, 1980 (both attached as Appendix "A" and "B" respectively).

Discovery Request No. 6 requests the furnishing of all cash flow studies prepared by or for the Licensee from January 29, 1979 until January 29, 1980. Since the request is deemed to be continuing, cash flow studies after that date would also be included.

The Licensee's response, on February 25, 1980, was to object to the unlimited time and scope of the original interroga-tory. Subsequent to that objection, a one year time period was l

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specified. Informal negotiations with the licensee have produced no further indication of licensee's intent.1/ Accordingly the present motion to compel is being filed.

Discussion: The cash flow study is a financial tool of great value in addressing the concerns of the Nuclear Regu-latory Commission with respect to the Licensee's present and projected financial ability to fulfill its duties as a nuclear l power ctation cperating license holder, and as a public utility. l l

The typical cash flow study is not a major element of l

l state or federal ratemaking proceedings, inasmuch as it simply l l

predicts based upon a number of assumptions and predictions, what will happen. It is possible, all other assumptions being reasonable, to vary one assumption within the study in order to predict how certain contingencies can affect the subject company for a given year.2/ Because cash flow studies give a good picture of what is available to meet the needs and obligations l of a business enterprise over time,S/ not only is it important l

l 1/ George Trowbridge, Esquire has indicated verbally that a response will be forthcoming, and that he does not consider the time specified in 10 CFR 2.740(f) governing motions to compel, to have run.

-2/ Thus, for Met Ed, predictions can be made for its financial viability given a wide range of assumptions about what level of rates are to be permitted by State and Federal agencies.

3/ Dependent upon the detail and assumptions employed in a study, a better picture of financial " health" can be obtained that by examination of an income statement l balance sheet. Cash items such as certain tax preferences, I annual depreciation recoveries or contingent liablities make interpretation of income statements and balance sheets a matter of art. 1 1

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to examine the assumptions used, but how those assumptions change over time. Cash flow studies may be prepared for a variety of reasons, including proposed issues of securities, merger or sale of assets, changes in interest rates not previously predicted or major new construction.

Here, the Public Utility Commission has requested cash flow studies prepared by or for Met Ed over a one year period starting one month prior to the TMI-2 accident. The Licensing Board must have meaningful primary data in order to adjudge whether Met Ed is " financially qualified" within the meaning of the Commission's initial hearing order, 10 CFR 550.40(b) and Appendix C to Part 50 of the NRC's regulations.

While a single cash flow studyS / is informative, a more complete picture can be obtained by examining all such studies over time -- in effect a ' moving picture' of financial qualifi-cations can be obtained over time.

WHEREFORE, The Pennsylvania Public Utility Commission asks the Licensing Board to compel the licensee to make and 4/ Licensee has suggested that the cash flow study prepared for rate proceedings held before the Pennsylvania Public Utility Commission after the accident will suffice. The Commission does not consider such specially-prepared studies to be primary source documentation of licensee's financial qualifications.

furnish discovery with respect to its Interrogatory No. 6, or in the alternative, to issue a subpoena directing Met Ed to produce the requested documents for the inspection and copying of all parties.

Respectfully submitted,

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, 4WA John A. Levin As'sistant Counsel For the PENNSYLVANIA PUBLIC UTILITY COMMISSION Dated: jf 90 k[Jrif [7 [C (717) 783-2804 Box 3265 -

Harrisburg, PA 17120

UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD In the Matter of )

)

MFTDOPOLITAN EDISON COMPANY ) Docket No. 50-289

) (Restart)

(Three Mile Island Nuclear )

Station, Unit No. 1) )

CERTIFICATE OF SERVICE I hereby certify that I have caused to be forwarded the attached " Motion to Compel" upon those persons as shown by the following Service List by deposit in the United States mail, postage prepaid, this 17th day of April, 1980.

b John A. Levin Aky'istant Counsel Pennsylvania Public Utility Commission

UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD In the Matter of )

)

METROPOLITAN EDISON COMPANY ) Docket No. 50-289

)

(Three Mile Island Nuclear )

Station, Unit No. 1) )

SERVICE LIST Ivan W. Smith, Esquire Ms. Marjorie M. Aamodt Chairman R. D. #5 Atomic Safety and Licensing Coatesv111e, Pennsylvania 19320 Board Panel U.S. Nuclear Regulatory ds. Holly S. Keck, Leg. Chairman Commission Anti-Nuclear Group Representing Washington, D.C. 20555 York (ANGRY) 245 W. Philadelphia Street Dr. Walter H. Jordan York, Pennsylvania 17404 Atomic Safety and Licensing Board Panel Ms. Frieda Berryhill, Chairman 881 West Outer Drive Coalition for Nuclear Power Oak Ridge, Tennessee 37830 Plant Postponement 2610 Grendon Drive Dr. Linda W. Little Wilmington, Delaware 19808 Atomic Safety and Licensing Board Panel Mr. Robert Q. Pollard 5000 Hermitage Drive 609 Montpelier Street Raleigh, North Carolina 27612 Baltimore, Maryland 21218 James A. Tourtellotte, Esquire Karin W. Carter, Esquire Office of the Executive Legal Assistant Attorney General Director 505 Executive House U.S. Nuclear Regulatory Commission P.O. Box 2357 Washington, D.C. 20555 Harrisburg, Pennsylvania 17120 I

l Docketing and Service Section Walter W. Cohen, Esquire l Office of the Secretary Consumer Advocate U.S. Nuclear Regulatory Commission Department of Justice j Washington, D.C. 20555 Strawberry Square, 14th Floor l Harrisburg, Pennsylvania' 17127 George F. Trowbridge, Esquire.

Shaw, Pittman, Potts & Trowbridge- Karin P. Sheldon, Esquire 1800 M Street, N.W. Sheldon, Harmon, Roisman & Weiss I Washington, D.C. 20006 1725 I Street, N.W., Suite 506 l

For: Licensee Washington, D.C. 20006 l

For: PANE i

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Dr. Chauncey Kepford Mr. Steven C. Sholly Environmental Coalition on Nuclear 304 South Market Street Power Mechanicsburg, Pennsylvania 17055 433 Orlando Avenue State College, Pennsylvania 16801 Theodore A. Adler Widoff, Reager, Selkowitz & Adler Robert L. Knupp, Esquire 3552 Old Gettysburg Road Assistant Solicitor Camp Hill, Pennsylvania 17011 County of Dauphin For: Three Mile Island Alert, Inc.

P.O. Box P, 407 N. Front Street Harrisburg, Pennsylvania 17108 Ellyn P. Weiss, Esquire Sheldon, Harmon, Roiseman & Weiss Mr. Marvin I. Lewis 1725 I Street, N.W., Suite 506 6504 Bradford Terrace Washington, D.C. 20006 Philadelphia, PA 19149 For: Union of Concerned Scientists Jordan D. Cunningham, Esquire Fox, Farr & Cunningham 2320 North Second Street Harrisburg, Pennsylvania 17110 For: Newberry Twp. TMI Steering Committee 1

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