ML19326D147

Responds to NRC 780113 Order.Requests That Commission Not Defer ALAB-452 Review.Certificate of Svc Encl

ML19326D147
Person / Time
Site:	Midland
Issue date:	01/27/1978
From:	Ross W CONSUMERS ENERGY CO. (FORMERLY CONSUMERS POWER CO.), WALD, HARKRADER & ROSS
To:	NRC COMMISSION (OCM)
References
NUDOCS 8006060729
Download: ML19326D147 (7)

Text

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I 50-329A @ j Midland Plant, Units 1 and 2 ) Docket Mos. 50-330A To the Nuclear Regulatory Commist. ion:

COMMENTS OF CONSUMERS POWER COMPANY IN RESPONSE TO COMMISSION ORDER OF JANUARY 13, 1978 Consumers Power Company (" Consumers Power") hereby files comments in response to the Com[nission's order of January 13, 1978. In that order, the Cornission stated that

_ it was considering deferring its review of the Appeal Bourd's opinion ALAB-452 until after the decision on remand and it solicited the views of the parties on this possible course of action. For the reasons set out below, Consumers Powcr believes that the Commission should not defer its review of ALAB-452.

A. Continued Uncertainty about ALAB-452 will Needlessly Waste Commission and Customer Resources and Impair Industry Planning -

The Appeal Board's decision in ALAB-452 constitutes "the first full-fledged antitrust decision" to be reviewed by the Board (ALAB-452, p. 3) under the Commission's antitrust responsibilities under the 1970 amendments to Section 105(c) of the Act. See 42 U.S.C. 2135(c). Since 1970, numerous legal and policy issues have arisen concerning the Commission's responsioilities under Section 105 (c) and the related obligations 8 006060 N f f

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required of those utilities which apply for nuclear reactor construction permits and operating licenses. Many of tLaso issues are discussed in the Appeal Board's 432-page decision and, almost invariably, are resolved against the positions that have been espoused by applicant-utilities. The Commission 1/

has never addressed most of these issues .- ALAB-452 presents both an opportunity and a pressing need for it to do so now.

Immediate review of ALAB-452 will help to alleviate the present uncertainty about the Commission's antitrust authority and responsibility which currently prevails. Two other antitrust proceedings which raise these issues are 2/

awaiting review by the Appeal Board.- The Midland decision is subject to remand, and in fashioning license conditions the remand tribunal will be guided by ALAB-452 unless that decision ic modified or reversed on appeal. If, as we believe, the Appeal Board's decision misconceives the mandate of Section 105 (c) , misreads the antitrust laws, and is misinformed about crucial aspects of the electric utility industry, the Commission's failure to correct these infirmities 1/ The only Commission discussion of its authority and responsibilities under Section 105 (c) involved two proceedings at a prehearing stage which involved peti-tions to intervene and initiate proceedings. See Louisiana Power & Light Co. (Docket No. 50-382A), 6 A.E.C. 48 and 6 A.E.C. 619 (1973); Houston Power & Light Co., et al. (Docket Nos. 50-498A ana 50-499A), 5 NRC 1303 (1977).

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- Toledo Edison Co., et al. (Docket Nos. 50-346A, et al.);

Alabama Power Co. (Docket Nos. 50-348A, 50-360A).

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quickly will lead to further, time-consuming litigation in these ongoing proceedings. Thus, for example, were the j

Commission to' defer review until after the remand proceedings in Midland and thereafter were the Commission to modify some of the findings of ALAB-452, another remand to consider license con-ditions appropriate to the modified order would be required.-3/

Deferral of review would needlessly waste not only administrative resources but also resources of lower Michigan's electric rate-payers. The company and the intervenors herein are electric utilities whose costs -- including legal expenses to pursue the instant litigation -- nre borne by their custo-mers. A Commission dec'ision to defer its review would therefore  ;

unduly burden these customers.

In addition, the nuclear industry needs to know as soon as possible whether ALAB-452 reflects the Commission's ,

-views about the nature and scope of its responsibilities under Section 105(c). In our view, ALAB-452 sanctions an overly-broad inquiry into irrelevant historical events, ignores important aspects of the present and future competitive relations among utilities, and establishes antitrust standards that no large investor-owned utility can satisfy jh/ As one antitrust licensing board has observed, "where the evidence does not prove inconsistency with the antitrust laws, no license condition is appropriate as to that aspect.of the market situation." Alabama Power Co., infra, Initial Decisior (Antitrust, Phase II) 5 NRC 1482, 1487 (1977)- (appeal peu. ding) .

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unless it agrees to actions which will jeopardize its ability to serve its customers reliably and economically. In plan-ning its future generation needs and weighing the nuclear option, consumers Power and other utilities are entitled to know whether their conduct and policies will be subjected to the type of review and sanctions which are reflected in ALAB-452.

Particularly in the near future, when many utilities will be making final "go or no go" decisions whether to proceed with construction of presently-deferred nuclear units, the need for immediate Commission resolution of issues raised by ALAB-452 is acute. In these circumstances, deferring con-sideration of ALAB-452,until the completion of the Midland remand proceedings and almost certain further appeal board

, review processes -- which could consume several years --

would be contrary to the public interest.

B. The Remand Proceedings will not Moot or Otherwise Impact upon the Appeal Board's Decision in ALAB-452 In ALAB-452, the Appeal Board found that the activi-ties of Consumers Power under the Midland licenses would maintain a situation inconsistent with the antitrust laws. In reaching this conclusion, the Appeal Board reversed numerous factual findings of the Licensing Board favorable to the Company and ruled that the Company had violated the " letter and spirit" of the antitrust laws (p. 420), This ruling is claarly ripe for review at this time.

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The Appeal Board's decision that the Company violated the antitrust laws is final in the sense that it will not be subject to modification or reconsideration in the future remand 4/

proceedings which the decision contemplatos. Further, the Company's basic need to seek review of ALAB-452 will be unaffected by the outcome of the remand proceedings. The findings and conclusions of the Appeal Board did much more than " trigger" the Commission's right to impose license condi-

tions under Section 105(c). These findings and conclusions 5/

besmirch the good name- of a company whose business requires the continued confidence of the public and the governmental institutions which regulate its affairs. They also may subject the Company to potentially onerous private treble damage anti-trust litigati'on. Thus, even were the instant remand proceed-ing to produce license conditions to which Consumers Power does not object, the injury to the Company wrought by ALAB-452 --

and its need to pursue administrative and judicial redress --

would remain.

-4/ See Brown Shoe, Inc. v. United States, 370 U.S. 294 (1962).

, There, the Supreme Court held that where a trial court rules that the defendant has violated the antitrust laws, but has not yet specified the remedy to be imposed, the ruling is final and subject to appellate review. The Court stated that, under the " settled course of the Court's practice," it "has consistently reviewed antitrust decrees contemplating either future divestiture or other comparable remedial action prior to the formulation and entry -of the precise details of the relief ordered."

- 370 U.S. at 309-

, 310 (emphasis add d) .

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Until the Midland proceeding, Consumers Power had never

'been accused, much less found guilty, of violating the antitrust laws in any judicial or administrative. forum.

Accordingly, ALAB-452 is not an interlocutory ruling which additional proceedings may render moot. The future proceedings envisioned by ALAB-452 will neither change its findings about the Company's alleged anticompetitive conduct nor affect the Company's need to seek review of those harmful (and, we believe, erroneous) findings. Hence, there is no reason to defer review of ALAB-452, and indeed every factor affecting the public interest calls for early Commission reso-lution of the basic legal, policy and factual issues generated by the Section 105 (c) review process.$

Respectfully submitted, 4

Wm. Warfield Ross Keith S. Watson WALD, HARKRADER & ROSS 1320 Nineteenth Street, N.W.

Washington, D.C. 20036 (202) '296-2121 Counsel for Consumers Power Company January 27, 1978 e

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CERTIFICATE OF SERVICE I hereby certify that I have this 27th day of January, 1978, served a copy of the foregoing COMMENTS OF CONSUMERS POWER COMPANY IN RESPONSE TO COM!!ISSION ORDER OF JANUARY 13, 1978 by mail, postage prepaid, upon the following persons:

Hugh K. Clark, Esquire Mark Levin, Esquire chairman, Atomic Safety Forrest Bannon, Esquire and Licensing Board Antitrust Division Nuclear Regulatory Commission Department of Justice Washington, D.C. 20555 P. O. Box 7513 Washington, D.C. 20044 Joseph Putberg, Esquire Antitrust Counsel for Nuclear The Honorable Frank Kelly Regulatory Commission Staff Attorney General Nuclear Regulatory Commission State of Michigan Washington, D.C. 20545 Lansing, Michigan 48913 Chase R. Stephens, Chief Dr. J. V. Leeds, Jr.

Docketing & Service Branch P. O. Box 941 Office of the Secretary Houston, Texas 77001 Nuclear Regulatory Commission Washington, D.C. 20555 Robert A:. Jablon, Esquire Spiegel & McDiarmid Seth R. Burwell, Esquire 2600 Virginia Avenue, N.W.

Durwell & Shrank Washington, D.C. 20037 1020 Washington Square Building Lansing, Michigan 48933

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KEITil S. WATSON 1

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