ML19329C463
| ML19329C463 | |
| Person / Time | |
|---|---|
| Site: | Davis Besse, Perry  |
| Issue date: | 09/05/1975 |
| From: | Lessy R, Vogler B NRC OFFICE OF THE GENERAL COUNSEL (OGC) |
| To: | Atomic Safety and Licensing Board Panel |
| References | |
| NUDOCS 8002140843 | |
| Download: ML19329C463 (29) | |
Text
{{#Wiki_filter:icM6tLhl UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD In the Matter of THE TOLEDO EDISON COMPANY and ) NRCDocketNos.50JWa[ THE CLEVELAND ELECTRIC ILLUMINATING 50-500A COMPANY 50-501A (Davis-Besse Nuclear Power Station, Units 1, 2 & 3) THE CLEVELAND ELECTRIC ILLUMINATING ) NRC Docket Nos. 50-440A COMPANY, ET AL. ) 50-441A (Perry Nuclear Power Plant, ) Units 1 & 2) ) NATURE OF CASE TO BE PRESENTED BY NRC STAFF Pursuant tu paragraph (2') of Prehearing Conference Order No. 4, dated April 29, 1975 this Board has directed the parties other than Applicants to infonn Applicants with respect to the nature of the case they intend to present at hearing, now scheduled to commence October 30, i 1975. That Order indicated the vehicle for so infonaing Applicants may be answers to interrogatories served August 16, 1974 In any event, state-ments of ultimate issues and suriinaries of evidence were to be included. At a subsequent conference call, it became clear that the Board expected infonnation as to relief to also be included. Staff has reviewed the orders and interrogatories in view of the nature of its case and has decided that the most appropriate vehicle for Staff to inform Applicants is to address in detail the issues set forth in Prehearing Conference Order R. 2 dated July 25,1974 8002140 f3 m
.ae ,A 2-BROAD ISSUE A I Whether the structure of the relevant market or markets and Applicants' 1/ position or positions therein gives them the ability, acting indivTdually, together, or together with others, to hinder or prevent: (1) Other electric entities U rom achieving access to f the benefits of coordinated operation 3/ either among themselves, or with Applicants: - (2) Other electric entities from achieving access to the benefits of economy of size of large electric generating units by coordinated development, 4/ either among themselves, or with Applicants: Staff will demonstrate that each of the Applicants has the ability both individually and acting together to hinder or prevent other electric entities in various markets from achieving access to the benefits of coordinated operation and coordinated development. Staff will demon-strate through expert engineering testimony that each Applicant has numerous options to select the power supply arrangements and joint ventures needed to obtain an economic and reliable power supply system. Expert engineering testimony will also establish that other electric entities (Where a footnote is preceded by quotation marks it is a verbatim quotation from the Licensing Board's Statement of the Issues. "l/ Applicants are the five participants in the Davis-Besse and Perry Nuclear Units: Cleveland Electric Illuminating (CEI), Duquesne Light Company, Ohio Eoison Company, Pennsylvania Power Company and Toledo Edison Company. The Applicants are also the five members of CAPC0, referred 'to below." "y Other electric entities refers to commercial fims, (other than the five Applicants), cooperatives, governmental units or similar organ-izations that generate, transmit or distribute electric power within the relevant market (s)." "3/ Coordinated operation includes but is not limited to such activities - as reserve anaring, exchange or sale of firm pcwer and energy, deficiency power and energy, emergency power and energy, surplus pcwer and energy, and economy power and energy." "4/ Coordinated development includes but is not limited to joint planning - and development of generation and transmission facilities."
- e lack most of the options ne. ad to cbtain an economic and reliable power supply system.
Through expert engineering testimony Staff will demonstrate that Applicants, individually and collectively, engage in numerous power supply transactions and joint enterprises (both with each other and with ncn-CAPC0 electric entities) which signifi,cantly reduce the costs of their bulk power supply systems while maintaining or enhancing te reliability of their systems. This expert testimony will also demonstrate that absent suitable arrangements with Applicants, most i of the other electric entities do not have the ability to engage in the power supply transactions and joint enterprises in which Applicants engage, because of the size, location, and lack of facilities of these other electric entities o_r_ because Applicants have neither provided them with the necessary services as requested, nor pemitted them to enter into joint arrangements with Applicants. Thus in summary, Staff will demonstrate that as a result of the capability and expanse of their transmission systems, generation capacities, and power exchanges with other electric entities Applicants individually, and as a group, have the ability to grant or deny power supply options and opportunities to other electric entities. Staff witness M, an engineer, will support this position through expert testimony, by referring in part to Applicants' responses to the Attorney General's 20 Questions, FPC Foms 1 and 12, discovery documents produced by Applicants with particular emphasis on Applicants' written contracts and power supply arrangements including all CAPC0 agree-ments and all agreements between individual Applicants and non-CAPC0 electric utilities, and other factual data.
Finally, based in part on the engineering testimony as above described, Staff witness E, an economist and an expert witness on behalf of the Staff will review the structure, so established, in terms of: (a) the market power enjoyed by Applicants, individually and as a group with others within relevant market areas, (b) the economics of the = nuclear units as unique resources in relation to the market activities l of the Applicants, and (c) the significance of the exercise of market power by Applicants in terns of the objectives of antitrust policy. i BROAD ISSUE B If the answer to Broad Issue A is yes, has Applicants' ability been used, is it being used, or might it be used to create and maintain a situation or situations inconsistent with the anti-trust laws or the policies underlying these laws. Staff wh demonstrate that Applicants individually have used, are now using, and are in a position to continue to use, their ability to create and maintain a situation inconsistent with the antitrust laws. Staff will also demonstrate that Applicants collectively have used and could j continue to use their ability and dominant position to refuse necessary I services when requested by other electric entities. At the same time I applicants have collectively prevented these other electric entities from engaging in joint arrangements with them. Staff will focus on the individual Applicants in their relationship with other paaer entities in e the relevant markets with particular reference to the following: i Duquesne Light Comoany - (a) Refusal to sell bulk power at wholesale to the Borough of Pitcai rn. (b) Refusal to interconnect or reach an interconnection agreement with the Borough of Pitcairn.
(c) Refu' sal to permit access to the Beaver Valley Nuclear Unit #2 to the Borough of Pitcairn. (d) Refusal to permit the Borough of Pitcairn access to bulk power services through power pool membership. (e) The historical relationship between the Duquesne _ight Company and municipal electric entities resulting in the present situation in which only one other electric entity (Pitcairn) remains in operation in the territory' served by Duquesne. 4 4 Thus, Staff will demonstrate that Duquesne t s used and has the present ability to further use its ability, acting alone and in com-bination with others, to create and maintain a situation inconsistent with the antitrust laws. Staff will support this position with factual testimony and introduce into evidence a number of documents produced by Duquesne on discovery. Ohio Edison Comoany "0E" (a) A policy of requiring some of its wholesale customers to participate in customer allocation agreements which are inconsistent with the antitrust laws. (b) A past and present policy of mfusing to provide or discuss the possibility of providing transmission services (" wheel-ing") of power over its transmission lines for the benefit of certain wholesale customers, notwithstanding a written request on behalf of its wholesale customers requesting such services on August 11, 1972. (c) A past and present policy of effectively frustrating compet-ition between OE and with its wholesale customers for in-dustrial loads. (d) A policy of imposing long-term capacity restricticns in con-tracts with wholesale customers which restrictians have an adverse effect on the operation and growth of the systems of said customers in a manner inconsistent with the antitrust laws.
1 1 1. Staff will support this position with fact witnesses (A and B), who have directly experienced this exercise of market power by Ohio i Edison and introduce into evidence examples of contractual provisions contained in contracts between OE and certain of its wholesale pro-visions which Staff feels are inconsistent with the antitrust laws.. i i Pennsylvania Power Comoany This company is a wholly-owned subsidiary of 0"to Edison. It is Staff's position that license conditions imposed upon the parent would also directly apply to its subsidiary. Nevertheless, the parent would 4 also be responsible for actions inco sistent with the antitrust laws 4 engaged in by the subsidiary. Staff will not present direct testimony ~ relating to Pennsylvania Power, but is advised that di ct evidence will be introduced at the hearing relating to: I (a) Refusal to sell the tcwn of Grove City, Pennsylvania i partial requirements firm power for resale on certain te rms. (b) Refusal to sell Grove City other partial requirements power for required maintenance of its system. i l i i
i CLEVELAND ELECTRIC ILLUMINATING COMPANY (a) A general policy of refusing to wheel power for cther j electric entities. (b) Past and present refusals to wheel 30 mw of PASNY power for the benefit of the City of Cleveland or AMP-0, 7 thereby (a) denying other electric entities access to poder supply sources and options beycnd the control of CEI and (b), thereby denying other such entities the l ability to " wheel-out" any excess capacity. (c) Refusals to make either maintenance power or a range of interconnection services availablo to the City of Cleveland. (d) Refusals to provide a ' synchronous interconnection to the City of Cleveland. (e) Refusals to permit access to the Perry and Davis-Besse l nuclear plants as requested in writing on April 11, 1973 1 . by the Law Director of the City of Painesville, Chio. i .l (f) The terms and provisions of the CEI-Painesville agreement dated April 28, 1975 are anticompetitive. l 1
. - _ ~.. i i 4 4 l Staff plans to support this with the testimony of four witnesses. The first such witness, an engineering expert, will describe the bottle-neck created by the physical relationships and analyze the contractual provisions as above described. The next three witnesses will provide I factual data with specific reference to (i) the relationship between CEI 1 and the City of Cleveland; (ii) the relationship oetween CEI and the City of Painesville; (iii) the relationship between CEI and AMP-0, and its j members. i i TOLED0 EDISON COMPANY ("TE") i i (a) The effective refusal to provide transmission and other interconnection services as requested by the Cities of l ~ Napoleon and Bowling Green, Chio. ) I Staff will present ene witness testifying to facts in support of i the above. Staff is advised that direct evidence will be introduced at the hearing relating to the following: (b) Toledo Edison entering into a customer allocation agreement with Consumers Pover Company, which agreenent.is inconsistent with the antitrust laws. i i t
-9. (c) Toledo Edison has required certain anticompetitive provisions in approximately 13 (now 9) contracts with its wholesale customers, pertaining)to (i) competition for industrial loads and (ii TE approval for extension of service. (d) Tolede Edison is ~a party to the Buckeye Agreements the provisions of which as enforced by TE in dealing with certain of its municipal customers are incon-sistent with the antitrust laws. MATTERS IN CONTROVERSY UNDER BROAD ISSUES A AND B_ (1) Whether the Combined CAPCO-Company Territories (CCCT) E is an appropriate geographic market for analyzing the possible creation or maintenance of a situation incon-sistent with the antitrust laws or the policies under-lying those laws. Staff will demonstrate by the use of expert economic testimony that the Combined CAPC0-Ccmpany Territories (CCCT) is a relevant geographic market for antitrust analysis. The comoined CAFC0 company (Central Area Pcwer Coordination Group) "5] Territories (CCCT) refers to the region bounded by the outer per-imeters of the geograohic territories of the five CAPC0 members, as shown on the map submitted by CEI as Exhibit F to Information Re-quested by the_ Attorney General _ for Antitrust Review in connection witn the Perry Nuclear Pcwer Plant Units i & 2. (The map is entitled " Principal Facilities of CAPC0 as of October 31, 1969" and was pre-pared by Duquesne Light & Co.). "
(2) Whether there are any relevant geographic submarkets, and, if so, what are the boundaries. Staff will demonstrate that the relevant geographic submarket includes the area reached by each of the Applicant's transmission facilities. ) In so demonstrating, Staff will primarily utilize testimony of its economic expert, its engineering expert and other engineering testimony and factual data that will also be presented. (3) Whether any or all of the following are relevant product markets for analyzing the possible creation or maintenance of a situation inconsistent with the antitrust laws or the j policies underlying those laws: (a) Regional power exchange transactions within pcwer pooling arrangements involving exchanges and/or sales of electric power for resale. (b) Bulk pcwer transactions involving individual contracts for sale-for-resale of firm electric power or for emergency, deficiency or other types of wholesale poner. (c) Retail power transactions involving sales of electricity to ultimate consumers. i The relevant product market upon which Staff will primarily rely in its antitrust analysis is (b), i.e., the bundle of bulk power i transactions, or bulk power services that are required for coordinated operation and development. Staff may also rely upon evidence relating to the contractual provisions of wholesale (bulk power) contracts which restrict or limit competition for industrial customers.
3. Whether Applicants' stipulated _/ ominance 1/of 6 (4) d bulk power transmission facilities in the CCCT gives them the ability to hinder or preclude competition in the transmission of bulk power. l Staff will demonstrate that dominance of bulk power transmission facilities gives Applicants the ability to hinder or preclude competition in relevant markets in the transmission of bulk pcwer by foreclosing bulk power options to the effected power entities. Staff has reviewed Appli-cants stipulation 8/ as to transmission dominance, and finds it equiv-ocable as to all Applicants but CEI. Accordingly, Staff will establish dominance in fact over transmission facilities by Applicants utilizing engineering and economic testimony. Staff will then demonstrate, in a similar manner, that Applicants' transmission systems, individually and collectively, give them the ability to grant or deny pcwer supply options and opportunities to other electric entities. Staff will then demonstrate that the transmission systems of applicants are " essential resources" under U.S. v. Terminal Railroad Association, 224 U.S. 386 (1912), i 6/ Transcript pp. 448-451; 473; 483-484 "7/ Dominance here and below refers to percentage shares of 75% or more ~ in relevant service market areas." 8/ See note $ supra. .,_l (5) Assuming the answer to (4) is yes, whether Applicants have, do or could use their ability to preclude any electric entities within the CCCT from obtaining sources of bulk power from other electric entities outside the CCCT. i With reference to Staff's response to " Broad Issue B", Staff will demonstrate the following: a. That CEI has had, does presently have, and most certainly in the absence of appropriate license conditions could continue in the future to have the power to preclude other electric entities, such as the City of Cleveland from obtaining alternative sources of bulk power. b. That Ohio Edison has refused to wheel fer, or to discuss wheeling with other electric entities or to admit they wheel for other investor-owned utilities. Thus OE has denied, and may continue to deny other electric' entities access to bulk power sources from other entities out-l side the CCCT, without appropriate license conditions. c. That Toledo Edison has and could, without appropriate license 1 conditions, preclude electric entities from obtaining sources of bulk power from other electric entities outside the CCCT. d. Only one electric entity (Borough of Pitcaim, Pennsylvania) currently exists in the geographic submarket dominated by Duouesne Licht i Company. The dominance of Duquesne gives it the ability in the absence of appropriate license conditions to preclude that entity from obtaining sources of bulk power from other electric entities outside the CCCT. i l
l 13 - 4 (6) Assuming that the ' answer to (4) is yes, whether Applicants have exercised, are exercising, or in-tended to exercise, their ability to prevent other electric entities in the CCCT from achieving: (a) the benefits of coordinated operations either among themselves or with Applicants. (b) access to the benefits of economy of size from large nuclear generating facilities. (c) any other benefits from coordinated development either among themselves or with Applicants. i With reference to Staff's response to " Broad Issue B" and the previous responses to issues 4 and 5 above, Staff will demons trate the following: a. That CEI has, and continues to exercise its ability to prevent the Cities of Cleveland and Painesville, Ohio from achieving the benefits of coordinated operations and development. CEI has denied, continues to deny, and may continue to deny without appropriate license conditions the City of Painesville access as requested, to the econcmies uf size of large nuclear generating units. b. That Chio Ecison has prevented, and without appropriate license conditions has the ability to continue to prevent other electric entities from achieving the benefits of coordinated operations and development. c. That Toledo Edison has prevented in the past and without appropriate license conditions has the ability to continue to prevent other electric entities such as Napolean and Bowling Green, Chlo from achieving the benefits of coordinated operations and development. --.m-
- i d.
That Duquesne Light Company has denied and has the ability to continue to prevent other electric entities such as the Borough of Pitcairn, from achieving the benefits of coordinated operations and i I development without appropriate license conditions. In addition, i l Duquesne had denied access to the benefits of the economy of size 'from l the Beaver Valley No. 2 nuclear unit to Pitcairn. (7) Assuming the answer to (6) is yes, has this ability to hinder or preclude competition been exercised forthe l purpose or effect of eliminating one or more of the other electric entities in the CCCT. 1 l l Staff will present factual evidence indicating a high mortality l rate among other electric entities in the relevant geographic market and submarkets. It will also present factual evidence as to the policy or policies of Applicant companies which may have contributed to this situation. I (8) Whether Applicants' stipulated dominance of bulk power i generation in the CCCT gives them the ability to hinder or preclude competition in one or more relevant markets. I i i l t
\\. l This matter in controversy is the same as number (4) above, 1 except it focuses on Applicants dominance of bulk power generation, i as opposed to item (4) above which focused on transmission. Staff 1 l hereby incorporates by reference that part of its response to number l (4) which deals with the significance of dominance as an aspect of l this case. Staff will also establish dominance over generation faci-lities utilizing engineering and economic testimony. In addition, Staff will establish that the Davis-Besse Units 1, 2, and 3 and the Perry Units 1 and 2 will materially maintain and indeed enhance Applicants dominance and their ability to hinder or preclude competition in relevant markets. (9) Assuming the answer to (8) is yes, whether Applicants have exercised control over bulk power facilities to ~ deny to other electric entities in the CCCT: (a) access to the benefits of coordinated operation, l either among themselves, or with Applicants. (b) access to the benefits of economy of size of large electric generating units. (c) access to any other benefits from coordinated development, either among themselves or with Applicants. i Staff herein incorporates by reference its response to number (5) and (8) above. Staff will demonstrate that Applicants' dominance of bulk pcwer generation (as well as transmission) has given them the ability to hinder or preclude competition in the relevant markets by foreclosing bulk power options and the benefits of coordinated operation and development to the affected power entities.
(10) Whether Applicants' policy or policies with respect to providing access to their nuclear facilities to other electric entities in the CCCT, that are or could be connected to Applicants, deprives these other electric entities from realizing the benefits i of nuclear power, Staff will demor: strate that the policies of both the Cleveland Electric Illuminating Company with respect to the Cities of Cleveland and Painesville and Duquesne Light Company with respect to the Borough of Pitcairn deprives the designated electric entities from realizing the benefits of nuclear power. ) (11) Whether there are logical connections between the activities under the proposed licenses for the nuclear i facilities and each of the matters in contention (1) through (10) that meet the nexus test established by the Atomic Energy Commission. 9/ Staff will demonstrate the relationship between the " situation incon-sistent with the antitrust laws" and the " activities under the license". After development of the factual context, the Board will be in a position to make a determination as to the existence of a reasonable nexus. [See In the Matter of Alaoama Power Comoanv, (Joseph M. Farley Nuclear Plant, Units 1 and 2), 6 A.E.C. 5 at p. 88 (February 9,1973)]. By " situation" Staff refers to proof of "the anticompetitive situation" pursuant to the holding of the Atomic Safety and Licensing Appeal Board in Wolf Creek.lE/ 'o/ Ine original footnote setting forth this issue referenced the nexus ~ test of the Atomic Energy Commission to the Waterford decisiens, RAI ~ 73-2-48, (February 23, 1973 and RAI 73-9-619 (Septemoer 28,1973). Since that time of those decisions,the body of law within the Commission has further developed, and Staff also deems instructive the decision of the Atomic Safety and Licensing Appeal Board, In the Matter of Kansas Gas and Electric Comea.1y and Kansas City Power and Lignt Coccany) (Wolf Creek (2enerating 5tation, Unit No. i), ALAB-279, June 30, :375, NRCT75I/_, at p. 10/ Ibid. +-m 3,
i That anticompetitive situation will be established by proof of the structure of the relevant markets and Applicants position therein, l as well as a description of the market power,.and its use by 'Appli-cants. [ The relationship between that " situation" and the " activities-under the license", i.e., the planning, building, and operation of the nuclear facilities plus the integration of the nuclear facilities in the bulk power supply systems, will likewise be demonstrated by l expert testimony. I i
- 12. Remedy 1
At a conference call with the Chairman, it was concluded that Applican'ts should be advised of the nature of relief to be sought. ] Staff will propose license conditions which, the Staff feels will be sufficient to remedy the situation inconsistent with the antitrust laws that will be maintained or created by the activities under the t license.11/ Attached is a set of conditions whicn the Staff believes to be i appropriate in this matter. Of course, the record as developed may modify the license conditions Staff will ultimately recommend in its Proposed Findings. On the basis of the evidentiary record Staff may ultimately recommend additions to or modifications of these conditions. 11/ Staff will addres; in its pre-trial brief the broad discretion the Board has to fashion remedies it feels appropriate to remedy a situation inconsistent with the antitrust laws. l 4 I I --.. _ _ _.. -. ~
l 18-4 I Respectfully submitted, 44 BeryTamin H. Vogler / i Assistant Chief Antitrust Counsel for f4RC Staff I OO l Mr c%,:_, RoyP.JCessy,Jrl'fl Counsel for i1RC St'aff w i Dated at Bethesda, Maryland this 5th day of Septerber 1975. i r i 4 1 = I i r. ,, ~. _. _, _, - _ _ -, _,, _ _ ~ -. _ _ _ _ _ _ ,_,.______.m..
SAMPLE (7ATTMET 7 0F CI!LK POWER _ SilPPLY PN ICIES De fi ni_t ions (a) " Applicable arca" means those counties in the State of and any other state in which, now or in the future, the Ccrpany engages in generation, transmission and/or distribution of electric power and those I areas reasonably proximate thereto. (b) "The Company" means i or any ;uccessor corporation, or any assignee of the Company, i
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""eighb:rieg entity" reans a private or cublic cornoration, i i 90'/3- ': :;l acs cy r authority, r ai:i clity rural slectric cooperative, s oc ~ - J 1ss ciuf :' of any of t' a #c g;ir;, *..hi:b :.sns, contractually c:-- Or coec t_r. or in gocc - :59.: $a 0. contractually cer:rci, cc opcrat-Mcili ties #:- : 2 g
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- a~; to - #ca:' sucn regi c f.'. q) ".leig%cring di stributiot-systeu" means a private or public cer;a-3 tion, gov 2rnmental agency or auth0rity, nunicipality, rural electric cccaer=:ive, or lawful association of any of the foregeing, which engages or in good faith proposes to engage in the distributioi, of electric energy at ret il, wh0. existing or proposed facilities are technically feasible
of connection with those of the Conpany, and which meets each of the criteria numbered (2) and (3) in subparagraph (c) above. II. Intercornections (a) The Company shall interconnect' and operate in parallel pursuant to written acreements with any neighboring entity. U2 l Interconnection agreetents sball not be linited to lower voltages wt.er c er voltages cre recuested and available and T.all not be limited to ' : ecl'.3ges t+n law:r vel: ages ar requested a-d available.
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co.< iide f:- -"e necessary cpt nr:::!c . :nd con:-:/ +:. : e " is re;.' 3; #:r the safe and prudent Operation of the inti :: e:ted 3: s : I. (d) :ntec. - ecti:n agree c.:: 3 t'. nct embody cr:,isions which ir:.. '~itaticr-. - - .3 usa :r '5;1~ 3 :f ca:acity erd energy, excect as 3;._
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Ceceu.j'; sys:=. ', e) Inter:Onnection acreement; shall not prohibit the parties from I enteri-] nto other interconnecticos or ccordination agreenents, but may inclace ap.:ropriate provisions to protect the reliability of the Conpany's i systen, and to insure that the Company is compensated for aJditioni! costs 1 I i l l l l i
.y_ resulting from such other interconnectionr or coordinaticn agreements. III. Reserve @ ordination (a) The Corpany and neighboring entities e-.h which it interconnects scali ratually ustablish a level of ninimum reserves to be installed or crovide as necessary to maintain a total reserve margin suf ficient' to provide adecu2:e reliability of power supply to the interconnected systems. The mir.4 ;- reserve margin thus deternined shall be stated as a cercentage of - i s '.ited :.nn Si peak load (adjusted for purchases and sales of
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e in :rconnected systems. "o party to the interconne : tion shi - :.. i '3 to '9stali ce cr;/ ice.1ere than su: ;ercentage of its '..a- - - i w a- ... i. n i... ".'.s a r". 2...s'.-'.. c c3 s a. (b) The Con;2ny shall sail energency ;;. 3r :) 1 3.eighboring entity nli.s t e
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. ; 3 a c i 'y 2 m e,ergy are available # :- its cwn generating res cces .,..<...,,=c...a er = 1. a... ; -....2-..a, %a. n.n ], + o tk.., s s. v e x. s,.,. su.. i.h + - - - - d o :: t :u-iroairin; ser/ ice to its cust:.mers. Emergency i 00..s- : e F;r:isned to the fulles er. tent available from the supolying p;,;: :ssirej cy t.he party in need. l l (c) 'ne ;:rties to reserve coordinr: '. n :ransactions pursuant to tcis se::1:n shall maintain such are.y: - operating reserves as may be ade:aate tc avoid the imposition ov cnra se abia demands ?n any other party (ies) n in rceeting the nor.ral contingencies of operatinc tc J e systems.
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1 in no circumstances shall a party's operating reserve requirement exceed its minin.ua ree.erve requirement established pursuant to paragraph (a) above. (d) The Company, if it has generating capacity in excess of the amount called for by its own reserve criteria, shall oronotly of.~ar, any such excess to a neighboring entity to meet such entity's own ninimum reserve rarcin. 'e; The Comcany shall prepare with neighboring antities who reauest to :: :, joint rai:':erance schedules ard shall engage in sales of tra' :3 - :e 20.> an energy when it can reasonably dc 50. P.. 0:he- :.3 - E - Should the Companj have on fi:e, or herer.f t.- fi: 2, the Federal Pcv r 3-- Cor 2 t n", agra - or rate s: ef.'e: rr: <'dir; #:r - e sale and purchase i of 5 - ; c.- ca.cac".. : : er.e ;, - -- + :-.er ca 5 :'., end energy, l ong- ....r-- .r ^ #. canaci t" and- ... i..., a n.. u. e ene. - ^ ~.0 c.:c ,.3C, en : fi-E. s: i able basis, enter into like or s'
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=,. : r.. .......,j.. - .a a =. V. Wholesale Power Sales The Canpany shall sell power on a full or aartial requ'.ements basis to any neignbaring distribution systen. Wholesale pcwer sales agreements i l t
shall not restrict use or resale of power sold purauant to such agreemants except as may be ne essary to protect the reliability of the Company's system. Such power will be delivered at the voltage requested if available. The Ccmpany s'iall not be required to make any such sale if it does not have 2vailable tufficient generation or transmission to provida the requested service. VI. Transnission Services Tr+ Co pany shall transmit pcwar (1) betws2n Ccmpany power sources and + :'.3rin: en:i-ies or neighboring distributior systens with which C.:--
- cccre:.r.'. (2) beteesa t< 0 or e eng nors tnan two neighborinc sc::'. s 2 ~ a neigh:: ring enti:j's syste-
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- ' +: -i; s/s i 3 form a contir.;0us electrical pa:h.
Any neigh.hcring en-i:y 3r neignb; ing distribution system (s) requesting such transmission servi : s' :ll give reasonable advance notice to the Company of itc schedule and regaicacents. The Ccmpany shall not be required to provide transmissi]n servica if to do so would jeopardize the Company's system reliability. i i e l
_ =. a (b) The Company shall include in its planning and construction programs I such increases in its transmission capacity as may be required for the tran; actions referred to in paragraph (a) of this Section, provided any 1 1 aoring entity or neighboring distribution system gives the Company l ne-sufficient advance notice as may be necessary to accormodate i, require-i rants from a technical standpoint. l VII. Access to lNclear Generation The Cu.: ny shall afford any neighboring en:i;y or noighboring 4 dis: m-ion syste:- t' at has nace a w i::en re..uast p ior to l ar :: -tunity ta :rti:icate ir - e :, t':hi; cf c :: curchase a portica of the output from Davis-Besse Units 1, 2 & 3 and Perry Nuclear Units 1 & 2, whichever the requesting party elects, up to a reasonable amount t of kilowatts. This participation shall be on a basis that will com-pensate the Company for its costs, incurred and to be incurred. The l Company shall provide promptly any requesting entity with sufficient I data to enable such entity to make a feasibility study as to its participation. i r l
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Ire C:~ccny shall aff:rd u; ' a reasonable arount in kilowatts } any ti; ooring ent.it:. or neight:rin: d;s:ribution system that makes a j tirely w.-it:en r. ;ues;an opcortunity to participate in the ownership of i or : curchase a portion of the output,whichever the requesting party 1 elects, from any other nuclear cenerating unit of the Company or in which tne C: pany obtains and ownership interest. The Ccepany shall mail to all neighbaring entities and neighboring distribution systens, no later than i e 4
the date of its public announcc::ent of the proposed construction of any such unit (s), all available data relevant to the nuclear facility (including esticates and projections) to enable any such entity or system to make a feasibility study as to its participatien. A request for participation with respect to such nuclear units shall be deemed timely if made within 270 days after the public announcenent by the Company of the proposed car,stru:-ion of such units. ') Any neigr'bo.ing entity or neighboring distribution system taking a ' Ej rec;es; for par-icipati:n in any nuclear unit of the Cc:r.pany, including the Davis-Besse Units 1, 2 & 3 and Perry Units 1 & 2, must enter into a legally binding and enforcible agreement within one year from the date the Company, in fact, provides the data as required in Section VII (a) and (b) above. The Company may require the inclusion in any ownership agreement provided for in this Section of provisions for (1) a prorata payment at the time of the signing of the agreement of all costs incurred up to that date and (2) additional prorata pay- . ments thereafter as The Company becomes obligated to expend funds for ' the planning or construction of said units and facilities. (d) The Company shall transmit power from the Perry and Davis-Besse Units, or any future nuclear unit it may own, operate or parti-cipate in, to any neighboring entity or neighboring distribution system which is a participant.in such unit, consistent with the requirements l of Section VI of these commitments.
8_ VIII. Reculatory A:pects Rate schedules and agreen:ents, as required to provide for the facilities and arrangerents needed to implement the bulk power supply policies herein, ara to be submitted by Company to the regulatory agency having jurisdiction thereof. Company agrees to include a provision in new rate schedul.e sub-missicrs associated with these license conditions, io that if the rates bechre e##ective prior to the resolution of contested issues associated uit" : 3 r?.te schedules and are thereaf ter reduc. ' in a; ordance with the regula:-, pec:asdi.;s and findings, a: propria:a refunds (including inte - - -auld te cade to retroactivel; ra#1ect.the decrease. o k
s UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD In the Matter of THE TOLED0 EDISON CCMPANY and ) NRC Docket Nos. 50-346A THE CLEVELAND ELECTRIC ILLUMINATING ) 50-500A COMPANY ) 50-501A (Davis-Besse Nuclear Power Station, ) Units 1, 2 & 3) THE CLEVELAND ELECTRIC ILLUMINATING ) NRC Docket Nos. 50-440A COMPANY, ET AL. ) 50-441A (Perry Nuclear Power Plant, ) Units 1 & 2) ) CERTIFICATE OF SERVICE I hereby certify that copies of NATURE OF CASE TO BE PRESENTED BY NRC STAFF, dated September 5,1975, in the captioned matter, have been served upon the following by deposit in the United States mail, first class or air mail, this 5th day of September 1975: Douglas V. Rigler, Esq. Melvin G. Berger, Esq. Chairman, Atomic Safety and ~P. O. Box 7513 Licensing Board Washington, D.C. 20044 Foley, Lardner, Hollabaugh and Jacobs Docketing and Service Section Schanin Bui; ding Office of the Secretary 815 Connecticut Avenue, N.W. U.S. Nuclear Regulatory Commission Washington, D.C. 20006 Washington, D.C. 20555 John H. Brebbia, Esq. John Lansdale, Esq. 1 1 Atomic Safety and Licensing Board Cox, Langford & Brown Alston, Miller & Gaines 21 Dupont Circle, N.W. 1776 K Street, N.W. Washington, D.C. 20036 Washington, D.C. 20006 Joseph J. Saunders, Esq. Mr. John M. Frysiak Steven Charno, Esq. Atomic Safety and Licensing Board Antitrust Division U.S. Nuclear Regulatory Comission P. O. Box 7513 Washington, D.C. 20555 Washington, D.C. 20044 Atomic Safety and Licensing Board Reuben Goldberg, Esq. Panel David C. Hjelmfelt, Esq. U.S. Nuclear Regulatory Comission 1700 Pennsylvania Avenue, N.W. Washingten, D.C. 20555 Washington, D.C. 20006
. Edward A. Matto, Esq. Robert D. Hart, Esq. Assistant Attorney General Department of Law Chief, Antitrust Section 1201 Lakeside Avenue 30 East Broad Street,15th Floor Cleveland, Ohio 44114 Columbus, Ohio 43215 John C. Engle, President George Chuplis, Esq. AMP-0, Inc. Commissioner of Light & Power Municipal Building City of Cleveland 20 High Street 1201 Lakeside Avenue Hamilton, Ohio 45012 Cleveland, Ohio 44114 Donald H. Hauser, Esq. Karen H. AdLirc;, Esq. Managing Attorney Assistar.L Attorney General The Cleveland Electric Antiirust Section Illuminating Company 3d East Broad Street,15th Floor 55 Public Square Columbus, Chio 43215 Cleveland, Ohio 44101 Christopher R. Schraff, Esq. Leslie Henry, Esq. Assistant Attorney General Fuller, Henry, Hodge & Snyder Environmental Law Section 300 Madison Avenue 361 East Broad Street, 8th Floor Toledo, Ohio 43604 Columbus, Ohio 43215 Thomas A. Kayuha Mr. Raymond Kudukis, Director Executive Vice President of Public Utilities Ohio Edison Comoany City of Cleveland 47 North Main Street 1201 Lakeside Avenue Akron, Ohio 44308 Cleveland, Ohio 44114 Thomas J. Munsch, Esq. Gerald Charnoff, Esq. General Attorney Wm. Bradford Reynolds, Esq. Duquene Light Company Shaw, Pittman, Potts & Trowbridge 435 Sixth Avenue 910-17th Street, N.W. Pittsburgh, Pennsylvania 15219 Washington, D.C. 20C06 Wallace L. Duncan, Esq. Richard M. Firestone, E:q. Jon T. Brown, Esq. Assistant Attorney General Duncan, Brown, Weinberg & Palmer Antitrust Section 1700 Pennsylvania Avenue, N.W. 30 East Broad Street,15th Floor Washington, D.C. 20006 Columbus, Ohio 43215 David McNeil Olds Wallace E. Brand, Esq. Reed, Smith, Shaw & McClay 1000 Connecticut Avenue Union Trust Building Suite 1200 Pittsburgh, Pennsylvania 15230 Washington, D.C. 20036 Frank R. Clokey, Esq. James B. Davis Special Assistant Attorney General Director of Law Room 219, Towne House Apartments City of Cleveland Harrisburg, Pennsylvania 17105 213 City Hall Cleveland, Chio 44114 i
. Alan S. Rosenthal, Chairman Richard S. Salzman Atomic Safety and Licensing Atomic Safety and Licensing Appeal Board Appeal Board U.S. Nuclear Regulatory Commission U.S. Nuclear Regulatory Commission Washington, D.C. 20555 Washington, D.C. 20555 Michael C. Farrar Victor F. Greenslade, Jr. Atomic Safety and Licensing Principal Staff Counsel Appeal Board The Cleveland Electric Illuminating U.S. Nuclear Regulatory Commission Company Washington, D.C. 20555 P. O. Box 5000 Cleveland, Ohio 44101 Reed, Smith, Shaw & McClay Suite 404 Madison Building, N.W. Wasnington, D.C. 20005 ^.-) Gk'Q, 4 Roy P.) Lessy, J r'. Counsel for NRC Staff 9 i J ..}}