ML19329D747
| ML19329D747 | |
| Person / Time | |
|---|---|
| Site: | Crystal River  |
| Issue date: | 06/21/1968 |
| From: | Dunn E, Evertz H, Snapp R FLORIDA POWER CORP. |
| To: | US ATOMIC ENERGY COMMISSION (AEC) |
| References | |
| NUDOCS 8003170688 | |
| Download: ML19329D747 (25) | |
Text
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CU UNITED STATES OF AMERICA b
JUN2519c8> Ts ATOMIC ENERGY COMMISSION cic;.t e,:.cq 3
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ou In the Matter of
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N FLORIDA POWER CORPORATION
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Docket No. 50-302 I
(Crystil River Unit 3
)
Nuclear Generating Plant)
)
ANSWER OF FLORIDA POWER CORPORATION TO PETITION FOR LEAVE TO INTERVENE AND MOTION TO BROADEN ISSUES FILED BY THE CITY OF GAINESVILLE, FLORIDA, AND CAINESVILLE UTILITIES DEPARTMENT I
INIRODUCTION
~
Florida Power Corporation (Florida Power) is the Applicant in Docket No. 50-302 for a construction permit under Section 104(b) of the Atomic Energy Act (Act) for Crystal River Unit 3 Nuclear Generating Plant.
On June 1,1968, a ' Notice of Hearing to consider the Application filed un-der Section 104(b) of the Act by Florida Power was published in the Federal Register (33 FR 8235).
On June 14, 1968, the City of Gainesville, Florida, and the Gainesville Utilities Department (collectively referred to as "Gainesville"',
filed a Petition for Leave to Intervene and Motion to Breaden Issues (Peti-tion and Motion) in the proceedinge, dated June 14, 1968, pursuant to Sec-tion 2.714 of the Commission's " Rules of Practice",10 CFR Part 2 On June 19, 1968, the Chairman of the Atomic Safety and Licensing Board (AS&LB) announced at the prehearing conference duly conven;d at the Crystal River Elementary School Auditorium in Crystal River, Florida,
pursuant to dhe Notice of Hearing in the above Docket, that it was the a
decision of the AS&LB that Cainesville's Petition and Motion be denied upon authority of the decisions of the Atomic Energy Commission (AEC) in the Duke, Vermont Yankee and Philadelphia Electric Company proceedings and the decision of the AS&LB La the Boston Edison proceedings, more fully discussed and cited in this Answer.
II RESPONSE TO SPECIFIC ALLEGATIONS 1.
Tha Petition and Motion alleges in paragraph 2 that Gaines-ville operates an electrical generating, transmitting, and distribution system in and about the City of Gainesville and that it is seeking, by ap-plication to the Federal Power Commission, an interconneccion with Florida Power. Gainesville's statement that the Presiding Examiner, on January 17, 1968, issued an initial decision ordering the interconnection is correct insofar as it is recited, however, it does not disclose any of the "terum and conditions" to which the initial decision is subject. The Presiding Examiner specifically found that since 1964 Gainesville has constructed approximately 16.2 miles of electric lines which duplicated Florida Power's and that Gainesville had continued this wasteful and uneconomical practice between the close of the evidentiary hearing and the date of his initial decision. I;.e Presiding Examiner stated that such duplication of Florida Power's plant and facilities is an uneconomical and wasteful practice and was, therefore, con:rary to the public interest. Among the terms and con-ditions the Presiding Examiner imposed as a condition precedent to any interconnection was the requirement that Florida Power and Gainesville work out a mutually satisfactory territorial agreement in order to avoid the further construction by Gainesville of duplicating facilities.
2 Florida Power has filed exceptions to the Presiding Exami-ner's Initial Decision in the Federal Power Co= mission proceeding ci.alleng-ing the Federal Power Commission's authority to require Florida Power to interconnect with Gainesville. The ultimate outcome of the interconnection
- proceeding is most uncertain and will not be known for several years if Gainesville or Florida Power exercises' tl air rights to full judicial re-view of any final order of the Federal Power Commission.
3.
The Petition and Motion alleges in paragraph 3. that Gaines-ville is interested in the possibility of participating with Florida Power in the financing and construction of the proposed plant, together with the purchase of a part of the output of the plant as a possible alternative to the construction of its own additional generators. Gainesville's interest in participating in Florida Power's nuclear project, among many other reasons, comes too. late to be worthy of any consideration. The project is beyond the point of modification and Gainesville's c )ncern for an additional source of electric power is in no way the responsibility of Florida Power.
Florida Power's nuclear facility was planned in 1965, contracts were signed, and the Application to construct the nuclear facility was filed in August of 1967 in order that the unit would become operational in 1972 to meet its projected system load growth and maintain system reliability.
Since the electrical systems of Gainesville and Florida Power were not interconnected in 1965, nor are chev at this time, Gainesville's electric power supply problems were not contemplated in determining the size or location of the nuclear facility. The entire output of Florida Power's nuclear unit is 3
required for its own projected system load growth.
4.
On its face the Petition and Motion filed by Gainesville has not stated any present economic interest in the proceeding which would permit intervention. Gainesville's electric system is not now interconnected with Florida Power's electric system. Gainesville is in the same situation
,as Piedmont Cities Power Supply, Inc. (Piedmont), whLch attempted to inter-vene in the Matter of Duke Power Company, AEC Dockets Nos. 50-269, 50-270, and 50-287. Piedmont, like Gainesville, filed a petition for leave to intervene in the Duke proceeding and claimed it had a present economic interest in Duke's reactors because it wished to purchase a fair share of Duke's Oconee Nuclear Project. The AEC disagreed with Piedmont, stating that Piedmont had "no existing economic interest related to the jurisdic-tional issue but only seeks to acquire such an interest.".
In affirming the AS&LB's denial of Piedmont's right tointervene,theAECstatedi$'its
- Decision in the Duke proceeding, dated January 3,1968 (3 AEC
):
"We turn now to the question of intervention. As earlier indicated, Piedmont Cities Power Supply, Inc.
has excepted to the board's denial of its petition to intervene. Piedmont disputes the statement in the initial decision that it did not have a present inter-est sufficient to warrant intervention and claims that it had as much economic, public and other interest in this proceeding as had the eleven cities. In this connection, Piedmont asserts an economic interest in its plan to own a ' fair share' of the Oconee plant and to sell its share of the electricity at cost to the eleven municipalities and declares that its interests and those of the municipalities are identical and uni-tary.
"Before treating with the Piedmont exception, it is appropriate that we comment on the status of the eleven aunicipalities. Our Memorandum and Order of De-4 ce=ber 5,1967, in the Matter of Philadelphia Electric Company,had occasion to remark on the Duke board's f
m grant of intervention to the municipalities since a similar intervention request by the City of Dover was pending before the board'in the Philadelphia Electric proceeding and the latter was seeking ecr guidance thereon. We stated in the Memorandum and Order that, while the question is not free from doubt, we thought the grant of intervention by the Duke board was cor-rect, and that the municipal customer seeking inter-vention in Philadelphia Electric should be permitted to intervene for the stated purpose of contesting licensing jurisdiction under Section 104b. We went on, however, to declare our view that 'the matter of legal entitlement to intervene in the somewhat novel circumstances is less clear than certain of the state-ments in the Duke initial decision would imply' and that we preferred to ' rest our holding on what we deem to be a sound exercise of administrative dis-cretion as applied to the particular circumstances here presented'. Thus, our sanct( ining of inter-vention as respects the municipalities,in both pro-ceedings rests on the narrow grounds stated.
"The circumstances with regard to Piedmont are substantially different than those dealt with above.
Unlike the cities, Piedmont has no existing economic a
interest related to the jurisdictional issue but only seeks to acquire such an interest. This interest claim, in our view, is a remote and tenuous one at best and does not warrant a grant of intervention."
The AEC summed up its Decision dated January 3,1968, in the Duka proceeding, supra, by stating:
"In sum, we perceive no sound basis for overturning the board's denial of intervention to the corporation."
5 On January 12, 1968, the municipalities and Piedmont filed peti-tions for reconsideration by the AEC of its Decision of January 3,1968, in the Duke proceeding. On February 29, 1968, the AEC entered its Memorandum and Order (3 AEC
) and it stated with regard to the denial of Piedmont's right'to intervene:
"The petition for reconsideration filed by Piedmont Cities Power Supply, Inc., presents nothing which would lead us to alter our previous holding that denial of in-tervention was proper. We remain of the view that the
~5"
interest claimed by Piedmont is remote and tenuous at best and that it affords neither a basis for entitlement to intervene under our Act nor one warranting a grant of intervention in the sound exercise of administrative discretion, as was the case with the municipalities."
6.
In the Matter of Vermont Yankee Nuclear Power Corporation (Vermont Yankee Nuclear Power Station), Docket No. 50-271, a group of mun4.cipal elec-
,tric systems in Massachusetts filed petitions for leave to intervene, assert-ing they had cn interest in the proceeding because they desired to purchase a share of ti.e Vermont Yankee nucleer plant on the same basis as the private power companies which were sponsoring Vermont Yankee Nuclear Power Corpor.-
tion. On April 8, 1968, the AEC entered its Memorandum and Order, reportcd in 3 AEC
, upholding the AS&LB's denial of the Massachusetts Munici-pals' right to intervene. The AEC dealt with the question of intervention as follows:
" Intervention. We address ourselves initially to the question of entitlement on the part of the Massachu-setts Municipals to intervene in this proceeding. Our treatment of this question necessarily begins with an j.
examination of Section 189a. of our Act.
That section provides, insofar as here relevant, that in any Cornis-sion pr'oceeding under the Act for.the granting of a construction permic:
"'... the Commission shall grant a hearing upon the request of any person whose inter-est may be affected by the oroceeding, and shall admit any such person as a party to such proceeding....' (Emphasis added.)
"Section 2.714(a) of our Rules of Practice (10 CFR Part 2) implements this statutory provision and delineates the requirements governing intervention in our licensing proceedings. That section provides, in pertinent part:
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"' Any person whose intcresc may Le affected by a proceeding and tiho desircs to partici-pate as a garry shall file a written peti-tion... /and/ set forth the interest of the petitioner in the proceeding, how that interest may be affected by Commission ac-
-ion, and the contentions of the petitioner.
"In their joint petition to intervene, the individual Municipala stated that their ' interests are affected because each of the individual Massachusetts intervenors owns and operates a municipal electric utility which distributes and sells electricity at retail and seeks the opportunity to purchase a share of the output of the Vermont Yankee Nuclear Power Station and arrange for transmission thereof, on the same or equivalent basis as such opportunity has been pro-posed for the sponsor companies and to all Vermont distribu-tion utilities'. While petitioner Power Planning Committee did not state, in like fashion, how its ' interest may be af-fected', it did declare that:
'The Co=mittee is seeking to obtain a reasonable opportunity for Massachusetts municipals to purchase power, and also stock if necessary, from the Vermonc Yankee project on the same or economically equiva-lent basis, as power is proposed to be made available to the present stockholder purchasers'.
"We fail to perceive how either of these stated interests constitute ones which 'may be affected' by the present pro-ceeding within the meaning of the cited statutory and regu-latory provisions. As will be shown more fully below, the substantive regulatory authority of the Co= mission in a pro-ceeding on an application for a construction perait under Section 104b. of our Act is limited to matters of radio-logical health and safety and common defense and security.
The Massachusetts Municipals in no way relate their inter-ests to these matters or show how those interests will be affected by our determination on the radiological safety and national security issues in the pJoceeding. Whate.er may be the authority of other governmental agencies, the Municipals' desire to purchase power and stock from the applicant is not a matter within our redress and we see no basis for deeming it an interest,affected by this licensing proceeding in view of the matters which are properly ours 4
for consideration herein."
7.
Under the rulings of the Atomic Energy Co= mission in the Duke 4-proceeding, supra, and the Verr.ont Yankee proceeding, supra, Gainesville is not entitled to intervene in this preceeding for the purpose of setting - _
"m forth its desire to purchase a share of Florida Power's nuclear plant or participate in the financing and construction of the proposed plant.
8.
The Petition and Motion alleges in paragraph 4 that Florida Power is, in fact, applying for a "coc=ercial license" within the meaning of Section 103 of the Act and that, therefore, the Commission 1ccks juris-diction to grant the application under Section 104 of the Act for a research and development license. This very same issue was raised by the Municipals in their petitions to intervene in the Duke, Vermont Yankee and Philadelphia proceedings. In fact, Counsel for Gainesville also represented the Massa-chusetts municipal electric systems.
~
9.
In paragraphs 5 and 6 of its Petition and Motion, Gainesville is attempting to inject the issue of possible violation of 2nti-trust laws into this proceeding.. These contentions, that Florida Power should be ap-plying for a Section 103 commercial license and that the AEC must consider the Federal anti-trust laws in granting a Section 104 license, have been resolved against Gainesville in the Duke, Vermont Yankee and Philadelphia proceedings. In the Vermont Yankee proceeding, the AEC dealt with these same contentions when they were made by the Massachusetts Municipals, as follows:
"The Municipals' attempts to bring their interests within the purview of this proceeding turn principally on their contentions that those interests are affected by actions of the applicant and its sponsors which are alleged to be in violation of the anti-trust laws. We I
are being asked, in this regard, to allow them to de-velop chese contentions in what they characterize as the
'2ublic investigatory hearing contemplated under the fAtomic Energy / Act' and to take curative licensing or other action on the basis of the record developed. The Municipals' requests, however, are plainly beyond our s Ututory province.
" As the staf f points out, proceedings to license power reactors can be conducted only under Sections 103 and 104 of our Act.
Section 103 governs the licensing, of power reactors of a type which the Commission has found to be of ' practical value' pursuant to Section 102 of the Act.
In connecti >n with such licensing, Section 105c. of the Act prescribes certain steps to be taken by the Commission with respect to antitrust considerations.
Included thercin, is Commission notification to the At-torney General of the proposed license and its terms and conditions and the receipt of advice from the latter offi-cial as to whether ' the proposed licanse would tend to create or maintain a situation inconsistent with the antitrust laws'.
As its terms make clear, however, Sec-tion 105c. is not applicable to licensing proceedings under Section 104b.
"In a proceeding for the issuance of a license under Section 104b. of the Act, which the instant pro-ceeding properly is (see below), the Conraission's sub-stantive regulatory authority is limited, as earlier stated, to matters of radiological health and safety and common defense and security. The Commission, in such a proceeding, lacks the authority to deny or con-dition a permit or license on the basis that it would tend to create or maintain a situation inconsistent with the antitrust laws. We believe this is clear from the distinction which the Act draws between proceedings under Section 103 and Section 104b. as respects con-siderati6n of antitrust matters, and from a reading of the legislative history of those provisions of the Act which bear on Conraission consideration of antitrust matters in facility licensing. That history shows a deliberate limitation in the 1954 Act of the broader antitrust authority in licensing matters which had been contained in Section 7(c) of the Atomic Energy Act of 1946.
"It might further be noted, that our construction of the 1954 Act in the subject regard, is reflected in the long-standing AEC regulations implementing the Act's reactor licensing provisions. Those regulations set forth the requirements of Section 105c. as part of the ' additional standards' applicable to issuance of licenses _under Section 103, and state that, in such licensing, 'f,d_/ue account will be taken of the advice provided by the Attorney General pur-suant to subsection 105c. of the Act'. These ?. additional standards' have no counterpart in the standards applicable l
to licensing under Section 104. See,10 CFR Section 50.42; and compare,10 CFR Sections 50.40 and 50.41..
"While 6..e Coa.assion lachs t;u o L mi to deny or condition a Section 104b. license on tbc basis that it would tend to create or maintain a situation inconsistent with the. antitrust laws, organizations which receive li-censes under that section are not relieved from the opera-tion of the antitrust laws. Section 105a. of our Act ex-plicitly declares that nothing contained in the Act shall relieve any person from the operation of the various anti-trust statutes specified therein. Morcover, under Section 105b. of the Act, the Commission is required to report pro =ptly ~to the Attorney Ccaeral any information it may have with respect to any utilization of special nuclear raterial or atomic energy which appears to violate or to tend toward the violation of the antitrust laws enumerated in Section 105a. or to restrict free competition in pri-vate enterprise.
"It was, perhaps, Section 105b. which the Municipals had in mind in asking that the issues specified for hear-ing be enlarged so that testimony, evidence, and recom-mended findings respecting antitrust considerations 'may be reported to the Attorney General for his use in the dispatch of his statutory responsibilities!. We would only state in response, that while the AEC endeavors to comply fully with both the letter and spirit of Section 105b., we cannot view its provisions as a warrant to use our licensing proceedings to develop evidence on matters unrelated to the issues properly within our jurisdiction solely so that we may assist the Attorney General in his law enforcement responsibilities.
"Licensability under Section 104b. In their excep-tions, the Massachusetts Municipals have also asserted that the board ' erred in failing to denylthe Vermont Yankec/ application as one improperly brought under Sec-tion 104 of the Act for a research and development li-cense since it is plainly a. project having" practical value" under Section 102 and therefore cognizable only for a " commercial" license under Bection 103 of the Act'.
The Municipals ask, in connection with the request for intervention, that we direct the board to consider their jurisdictional contentions in a reopened proceeding.
"The staff and the applicant have responded that the Municipals did not raise this jurisdictional issue in their filings with the board and further that our Decision of January 3,1968, in Matter of Duke Power Company (Docket Nos. 50-269, 50-270 and 50-287) states a rationale respect-ing licensability of utilization facilities under Section 104b, which refutes the Municipals' present jurisdictional contentions. We.believe-that the staff and applicant are correct on both counts.
. L 7
r r. 7---
~
"In two recent decisions, we have, as a matter of ad-ministrative oiscretion, sanctioned intervention in con-struction permit proceedings by municipal customers of the applicants who sought to challenge the Commission's juris-diction to issue the permits under Section 104b. of the Act. In those proceedings, as contrasted to the instant one, the persons socking intervention clearly asserted their jurisdictional contentions to the board in their petitions to intervene. We believe that, in the circumstances of the instant proceeding, an earlier holding of ours states a premise which is here dispositive:
"'One seeking intervention should in the first instance set'forth before the atomic safety and licensing board the matters on which he relies for a showing of interest.
Maintenance of an orderly hearing process and a due regard for the rights of the parties to a proceeding point to this as the proper course.'
"We further agree with the staff and the applicant that the rationale set forth in our Duke Decision of January 3,1968, respecting licensability of the Oconee reactors un-der Section 104b., applies as well to the matter of our juris-diction to license the present facility under that section.
The Vermont Yankee facility is clearly involved in the conduct of activities encompassed by Section 104b. or the Act as we have earlier construed it."
10.
Paragraphs 4, 5 and 6 of Cainesville's Petition and Motion are an attempt to inject into this proceeding the issue of whether or not Florida Power's proposed nuclear reactor has " practical value" with-in the meaning of Section 102 of the Act and should therefore be licensed under Section 103 of the Act. The Passachusetts Municipals attempted to inject this same issue into the Vermont Yankee proceeding, supra. The AEC followed its decision in the Duke proceeding, supra, and refused to permit the issue to be raised.
In dealing with this matter of " practical value", the AEC stated in its decision in the Duke proceeding:
"We address our attention first to the jurisdictional conten-tions underlying the exceptions of the intervening North Carolina _
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"In the context, then, of the statutory language and our con-struction of it, until there has been a ' demonstration of the.
practical value of such facilities for industrial or commerci31 purposes', utilization facilities which will provide a basis for commercial evaluation in connection therewith (i.e., ' leading to' i
such ' demonstration')'may be licensed under Section 104'b.
As the discussion below shows, this clearly places the Oconee reac-tors within the compass of Section 104 b.
"Our Memorandum and Order of Septeuber 8,1967, noted that the Commission has considered on two occasions in rule making proceed-ings the q-cstion of whether a finding of ' practical value' should 6
be made wi:h respect to some type or types of light water, nuclear power reactors. We concluded in the first proceeding, following receipt and consideration of extensivt public comments, the hold-ing of a legislative-type public rule making hearing, and a care-ful evaluation of all relevant factors, that '/p_/ending che com-pletion of scaled-up plc.nts, and the information to be obtained from their operation', there 'has not yet been sufficient demonstra-tion of the cost of construction and operation of light water, nuclect electric plants to warrant making a statutory finding that any types of such facilities have been sufficiently developed to be of practical value'. This conclusion was reaffirmed in connec-tion with our denial of a petition for rule. making approximately one year ago.
"It is worth restating at this point the circumstances which we took into account in arriving at our rule making determinations.
In conjunction with cur initial determination, we outlined these circumstances as follows:
"' Currently operable light water, nuclear electric p1' ants range up to about 200 net MN(e) and are not economically com-petitive.
In 1962 the Commission encouraged the construction of scaled-up plants by requesting authorization under the Power Demonstration program for plants in the 400-500 net MN(e) range. Operating experience, including maintenance and availability, from the plants for which Congress authorized appropriations in these intermediate sizes is not available, since none of them is completed. More recently, plants in sizes exceeding 600 vet MN(e) are being designed and construc.ted without Government financial assistance. The Commission has examined in s'eme detail whether the information provided by the award of contracts for the construction of scaled-up plants without Government assistance is sufficient to support, with-out further demonstration, a finding of practical value under the Act. Without the operating information the intermediate sized plants are expect ! to provide, we are not prepared to
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make a statutory finding on the basis of demonstrated results of the currently operable plants that plants at least three times larger than 200 net MW(e) are of practical value with-in the meaning of section 102.'
"We were faced with like circuustances at the ti=c of our second rule making uction and, while two of the intermediate-sized plants have now bcen licensed for operation, essentially the same situation as regards ' demonstration' obtains today. In this evntext, we think it manifest that large-scale utilization facilities, such as the Oconee reactors, by contributing to the as yet incomplete basis for a reliable estimate of economic competitiveness, are involved in the
, conduct of activities encompassed by Section 104b and, thus, are properly to be licensed thereunder.
"In their exceptions to us, the intervenors maintain that the proper standard for determining whether the type of utilization facility to be employed by the applicant has demonstrated practical value is whether or not it is being sold by the manufacturer and bought by the purchaser, without Government subsidy to either, for use in the large scale generation and sale of electrical energy in the regular course of business.
it should be cicar that we cannot accept this as the basis for de-From termining applicability of Section 104b.; nor does such an absolute standard constitute the test for a finding of ' practical value' under Section 102, although business factors of the type referred to are relevant for consideration in the latter regard.
"It is worth noting, in the above connection, that we addressed ourselves to a similar proposition in the first rule making determi-nation regardin; a finding of practical value. We there concluded, af ter examining the underlying data in some detail, that while cer-tain econcaic evaluations governing the award of contracts for scaled-up plants noe involvin; Govern =ent assistance provide strong indica.
tions that economic competitiveness will be achieved, we should await a reliable estimate of the economics based upon a demonstration of the technology and plant performance befor making the statutory finding.
" Analytical support for the above approach is contained in the Staff Memorandum accompanying cur determination. The staff there stated:
"'Although the willingness of utilities and equipct nt companies to accept the cuciness risks involved is an inpressiv, indication of the probabilities of successful operation at an-ticipated 1cvels, it is not alone a sufficient basis to support a statutory finding of practical value by the Commission. The manufacturers of nuclear reactors compete for the business of
_ utilities which are cons!dering the purchase of power plants, ___
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and are motivated to offer incentives such as warranties as to certain features in order to obtain the award of a contract.
The willingness of utilities co purchase nuclear plants and of reactor manufacturers to warrant the plants is a reflection of the acceptance of what may be considered reasonable business j.
risks, but does not necessarily constitute a sufficient assur-ance that the plants will in fact perform as warranted or will otherwise meet expectations. '
"In our second rule making determination, we gave further considera-tion to this matter when we took specific note of announcements of new light water reactors to be constructed, the type of business ar-rangements being negotiated between reactor manufacturers and utili-ties and the fact that utilities have decided upon nuclear plants l
on the basis of comparative economic studies. Our determination stated that while these developments are further strong indications that economic competitiveness will be achieved we continued to be-lieve that we should await a reliable estimate of the economics based upon a de=onstration of the technolegy and plant performance.
"The intervenors, in their exceptions, have also sought to em-phasize the experimental facet of the terms 'research and develop-1 cent' and to argue therefrom that the Oconee facilities do not proper-ly fit within the statutory language. While we believe these argu-1 ments are answered by the statements already made respecting the role of economic demonstration under Section 104 b.,
it is appropriate fur-ther to note the following passage in the previously-referenced Staff
)
Memorandum:
i
"'A substantial extrapolation of demonstrated results from currently operable plants, which range up to about 200 net >W(e),
t is necessary in order to. determine anticipated technological and
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economic performance in plants currently being built and sold j
without Government financial assistance in size ranges of 600 net MR(e) and above. Since the gap involves an increase in re-l actor size by a factor of three, many technical and engineering problems must be resolved and demonstrated. '
s "The initial decision has additionally enumerated a number of 3
aspects of research and development needed to complete the design of certain components for the Oconee units. Montioned in this re-gard are:
'a proposed once through. steam generator test, the con-trol rod drive line test, self-powered in-core neutron _ detector f
tests, thermal and hydraulic programs,... and the fuel assembly heat transfer and fluid flow test.'
We agree with the board that the foregoing,. individually and in combination, evidences an experi-s mental purpose concomitant with the purpose of economic demonstra-l tion.
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"One additional observation is in order before we leave the jur-Ladictional question. The licensing authority under Section 103 of our Act is only applicable as respects facilities of a type which the Con-mission has found, in accordance with Section 102, to have been suffi-ciently developed to be of_ practical value for industrial or co==er-cial purposes. The approach we have taken regarding the construction of Section 104b. is consistent with the premise that the finding of
' practical vclue' unde-Section 102 separates the issuance of devel-opmental licanacs under Section 104b. and the issuance of co==ercial licenses under Section 103. This, we think, is in keeping with the scheme of the Act and is legislative history."
- 11. The nuclear reactor which Florida Power has filed its appli-cation to construct in this proceeding is substantially similar to Duke Power's Oconee Units 1, 2 and 3 which the AEC has held are licensable only 4
under Section 104(b) of the Act. All of the above quoted statements and observations the AEC made regarding Oconee Units 1, 2 and 3 are equally ap-plicable to Florida Power's Crystal River Unit 3.
Crystal River Unit 3 is approximately twice the size of any nuclear reactor now in operation.
It properly belongs in the same generation of pressurized light water reactors with Duke Power's Oconee Units 1, 2 and 3; Metropolitan Edison Company's Three Mile Island Nuclear Plant; and Florida Power & Light Company's Turkey Point Units 3 & 4 - all still in the early stages of construction. Florida Power's Crystal River Unit 3 is expected to be completed about the same time as Duke Power's Oconee Unit No. 2.
There can be no doubt that Florida Power's Crystal River Unit 3 is a !>rge-scale utilization facility requiring the con-duct of research and development activities and is therefore properly licensa-ble only under Section 104(b) of the Act. The AEC has specifically ruled that before it will make such a finding of practical value pursuant to Sec-t tion 102 of the Act, the type of reactor involved cust have a sufficiently long period of operating experience so as to demonstrate that it is economical-ly competitive with conventional electric generating plants. Operation of -.
nuclear reactors the. size of Florida Power's crystal River Unit 3 will be just commencing about the same time ac Florida Pcwcr's reactor is nearing completion.
Section 104(b) of the Act is presently the only section of the Act under which Florida Power may ot enin a construction permit.
12.
In further support of the proposition that Florida Power's Crystal River Unit 3 is properly licensable under Section 104(b) of the Act,
. the AEC, on June 5,1968, rendered its decision in the Matter of Philadelphia Electric Co=pany (Peach Bottom Atomic Station Units 2 and 3), Docket Nos.
50-277 and 50-278, denying the municipal intervenor's contentions that the Peach Bottom reactors did not involve a sufficient amount of research and development to be licensed under Section 104(b) of the Act.
In denying the intervenor's contentions, the AEC stated as follows:
"This matter comes before us upon exceptions which have been filed by the City of Do*ver, Delaware, to an initial decision of an atomic safety and licensing board dated January 29, 1968.
In its initial decision, the board authorized the issuance of provisional construction permits under Section 104b. of the Atomic Energy Act to the Philadelphia Electric Company, the Public Service Electric and Gas Company, the Delmarva Power and Light Company, and the Atlantic City Electric Company, to build two boiling water reactors. The proposed facilities, which will be owned by all four companies as tenants in co= mon with speciffed undivided interests, are to be lo-cated at the Peach Bottom Atomic Power Station of the Philadelphia Elcetric Ccmpany in York County, Pennsyl-vania. Philadelphia Electric will be responsible for the design, construction and cparation of the. facilities.
"The exceptions filed by the City of Dover, an inter-venor in this proceeding, are in support of its basic contention that the Commission lacks jurisdiction to li-conse the two proposed reactors under Section 104b. of the Act.
Philadelphia Electric and the staff, in sub-missions co=pleted on March 4,1968, have filed briefs opposing the City's exceptions. #'
O "The appeal presently before us raises no health and safety question but disputes only the jurisdiction of the Commission 'to license the Peach Bottom facilitics under Sec-tion'104b. of the Act. The crux of the appellant's position is that these facilitics may not be licensed under that sec-tion since they were sold by the manufacturer and bought by the purchaser for commercial use, without Government subsidy i
to either.
'"The jurisdictional objection has been central to the City of Dover,'s participation in this proceeding. Tne City, a municipal customer of one of the applicanc utilitics, peti-tioned to intervene in the proceeding for the purpose of op-posing the grant of licenses under Section 104b. on the ground of lack of jurisdiction. The board granted interven-tica for this purpose on the basis, and within the terms, of our Memorandum and Order of December 5,1967. We had therein advised the board, in response to its request for guidance, that we deemed a grant of intervention to be appropriate as a matter of. administrativo discretion and that evidence may I
be received on the question of whether the application satis-fies the requirements of Section 104b.
"In the ensuing hearing, the intervenor and the other i
parties made their submissions to the board on the jurisdic-tional question. The board, in its initial decision, dealt i
specifically with this Isint and concluded that the applica-tion is properly filed and that licenses may be issued under Section 104b. In so holding, the board relied upon the con-struction of the applicable statutory language in our Mamo-randum and Order of December 5,1967, and in our later Duke Decision of January 3,1968, and found that there is sub-stantial evidence in the record to bring the Peach Bottom facilities within the ambit of those Commission expressions.
"The board's jurisdictional determination was mani-festly correct. As our discussion below shows, the rationale set forth in the Duke Decision of January 3,1968, wherein we considered and rejected a s: nilar jurisdictional objection respecting the licensability of the Oconee reactors, is dispositive here.
" Turning first to the statutory language, Section 104b.
authorizes the Ccumission, insofar as is here relevant, to license thereunder '... utilization... facilities in-volved in the conduct of research and development activities leading to the demonstration of the practical value of such facilities for industrial or commercial purposes.
In Duke, we stated with respect to this language that:
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"'... the "research and development" about which Sec-tion 104b. speaks encompasses as " development" a demonstra-tion that will provide a basis for co=mercial evaluation.
i Such " commercial evaluation", in terms of earlier relevant declarations, means an evaluation of the economic competitive-ness of the nuclear facility with conventional power plants.
"'In the context, then, of the statutory language and our construction of it, until there has been a "demonstraticn of the practical value of such facilities for industrial or com=ercial purposes", utilization facilities which will pro-vide a basis for commercial evaluation in connectica there-with (i.e., " leading to" such " demonstration") may be licensed under Section 104b. '
"We went on to point out in Duke that the Co= mission has congluded on two occasions in rule making proceedings that
'"1 p_/eading the completion of scaled-up plants, and the information to be obtained from their operation", there "has not yet been sufficient demonstration of the cost of construc-tion and operation of -light water, nucicar electric plants to warrant making a statutory finding that any types of such facilities have been sufficiently developed to be of practical value"'. The Duke Decision restated the circumstances which we took into account in arriving at our rule making determina-tions and declared that, while two intermediate-sized plants have now been licensed for operation, essentially the same situation as regards ' demonstration' obtains today. We then held:
"'In this context, we think it manifest that large-scale utilization facilities, such as the Oconee reectors, by core-tributing to the as yet incomplete basis for a reliable esti-mate of economic competitiveness, are involved in the conduct of activities encompassed by Section 104b. and, thus, are properly to be licensed thereunder.'
".It should be clear from the foregoing, that the pro-posed Peach Bottom facilities fall squarely within the com-pass of Section 104b. as we have construed it.
In this regard, we note and concur in the board's specific finding that these facilities will provide design, construction and operating information bearing upon the practical value of such facilities for industrial or commercial purposes.
"We further note that the initial decision enumeratos a nu=ber of aspects of research and development needed to complete the design of certain components for the Peach Bottom facilities. We are of the view here, as in Duke,
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that these research and develoc. scat efforts, ' individually and in combination, evidence [s_/an experimental purpose concommitant with the purpose of economic demonstration'.
"In its exceptions, the City of Dcver has specifically challenged'certain statements in the initial decision re-specting the scope of the term 'utilizatica facility'. The City contends that the board's understanding of the term as including.not only the reactor but associated equipment as well, is cc.trary to the definition of the tern as set forth in Secticn 30.2(b) of our regulations. This asserted mis-understaading, the City argues, nullifies the board's deter-minatica that the Peach Bottom facilitics arc involved in the conduct of activitics encompassed by Section 104b.
"It is, of course, clear that the term ' utilization facility' as we have defined it in 10 CFR Section 50.2(b) means the nuclear reactor. We think it further evident, from an examination of the opening paragraph of the initial decision, that.the board was well aware that the application which it was considering was one 'for previsional construc,.
tion' permits to construct two boiling water reactors '. The board's view that equipment associated with a nuclear reactor cannot be disregarded in the review of a license application, is founded on what would seca to be the sound premise that associated equipment may be integral to the operation of a reactor and that such equipment can have nuclear safety significance.
"We do not regard the foregoing view of the board as invalidating its conclusion respecting the licensability of thes2 facilities under Section 104b. ; and it patently does not alter our conclusion as to the applicability of that sec-tion or ti c reasons for it.
What we set forth in Duke re-specting utilization facilities which sdll provide a basis for co=mercial evaluation applies, as already stated, to the present facilitics._ With respect to the experimental aspects of these facilities, we cannot decm the proposed research and development programs to be irrelevant to a Section 104b. deter-mination on the ground that those programs relate, as the City asserts, 'to "certain components" and not to the Boiling Water Reactors themselves '. A ' reactor' it would seem evident, is the composite of its component parts; and research and develop-ment dealing with those components is plainly relevant to our determination -- as, for that matter, is research and develop-
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= cat on associated equipment which bears directly on the operation of the reactor. At any event, in the present case there is proposed research and development which clearly re-lates to co=ponent parts of the reactors.
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"In sum, we believe the two Peach Bottom reactors are properly to be licensed under Section 104b. of the Act.
"It is therefore ORDERED that the exceptions of the City of Dover are denied."
13. The statements sed quotations contained in paragraphs 7, 8 and 9 of Ga!.nesville's Petition and Motion pertaining to Congress' " State-ment of Policy" and " Purpose of the Act" form no basis whatsoever to allow Gainesville to intervene in this proceeding. The AEC does not need the
_ assistance of Gainesville to keep it on the straight and narrow path of Congressional policy and purpose in enacting dhe Atomic Energy Act. The Joint Committee on Atomic Energy (JCAE) has consistently demonstrated thac it is up to the task of overseeing the activities of the AEC. It is inter-esting to note that there has been no effort by the JCAE to modify through legislation the A2C's decisions in either the Duke or Vermont Yankee pro-ceedings. The unique role of the JCAE in nuclear licensing matters was recognized by the U. S. Supreme Court in Power Reactor Development Co. vs.
Electrical Union, 367 U. S. 396, 408.
- 14. With regard to Gainesville's Motion to Broaden the Issues as set forth in paragraph 10 of its Petition and Motion, such a suggestion has been ruled on by the AEC in both the Duke and Vermont Yankee proceedings, l
supra. As stated-in the AEC's decision in the Vermont Yankee proceedings:
"In a proceeding for the issuance of a license under Section 104(b) of the Act,..., the Commission's sub-stantive regulatory authority is limited, as earlier stated, to matters of radiological health and safety and common de-fense and security.
15. The Petition and Motion filed in this proceeding by Gaines-ville does not seek.to raise any issue relating to the radiological health.
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and safety of the pubile and the common defense and security.
16.
Florida Power can only assume that a reason Gainesville has filed its Petition and Motion in this proceeding is to delay Florida Power in its plan 'to construct and operate its proposed nuclear plant by early 1972 and thus jeopardi:c Florida Power's system reliability. Attached, as Exhibit "A", is a copy of a recent exchange of correspondence with the Gainesville Director of Utilities. Gainesville is well aware of the criti-cal timetable Florida Power must maintain if the nuclear unit is to be brought into service as scheduled, and it raises no issue of public health and safety or common defense ' nd security. For the past several years a
Gainesville has conducted a campaign to duplicate Florida Power's electric lines in the area outside of Gainesville and to induce Florida Power's customers to take their electric service from Gainesville. Without an
' effective territorial agreement, recommended by the Federal Power Commis-sion hearing examiner but which Gainesville has refused to consider, any such interconnection would result in Florida Power's "... contributing to its own economic erosion because of the adverse effect of such increased competition on 'its capital investment.
." (see Presiding Examiner's Initial Decision dated January 17, 1968 in Federal Power Co= mission Docket No. E-7257). The interconnection objective of Gainesville is a matter with-in the jurisdiction of the Federal Power Commission and the subject is being adequately adjudicated before that Agency. Because of the deficient nature of this intervention, as discussed above, Florida Power can only assume that such intervention serves no useful purpose, except as a presst c.$ tactic to force on Florida Power a course of action unrelated to AEC ' licensing of the
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Crystal River Project. -
CONCLUSION The premtses considered, Applicant prays that this Connission deny the Petition for Leave to Intervene and Motion to Broaden Issues on the fol-loving grounds:
1.
The Petition for Leave to Intervene and Motion to Broaden Issues filed in this Docket by Gainesville conclusively demonstrates that it has no existing-economic interest related to any jurisdictional issue, but that it only seeks to acquire such an interest.
2.
The Petition for Leave to Intervene and Motion to Broaden Issues filed in this Docket by Cainesville seeks only to inject into the public hearing issues and matters outside the jurisdiction of the Atomic Energy Co= mission.
3.
The Petition for Leave to Intervene and Motion to 3 roaden Issues filed in this Docket by Gainesville is ce=pletely_ void of any allegations of facts putting into issue questions relating to the radiological health and safety of the public and the co==on de-fense and security.
4.
The Petition for Lea a to Intervene and Motion to Broaden Issues filed in this Docket by Gainesville.
fails to comply with the requirements of Section 2.714 of the Commission's " Rules of Practice",10 CFR' Part 2, in that it does not set forth any legal
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incarest Which may be affected by any action of the Atomic Energy Commission.
5.
The Petition for Leave to Intervene and Motion to 3 roaden Issues filed in this Docket by Cainesville fails to comply with the requirements of Section 2.714 of the Commission's " Rules of Practice",10 CFR Part 2, in that it contains no contentions re-lating to the radiological health and safety of the public or to the co= mon defense and security.
1 6.
The Petition for Leave to Intervene and Motion to Broaden Issues fi :d in this Docket is ill founded be-cause the allegt and contentions set forth there-in have been heret; fore determined adversely to Gaines-ville by the Atomic Energy Commission in formal de-cisions as fully described in this Answer.
7.
The AS&LB correctly made a finding and ruling which denied the Petition for Leave to Intervene and Motion to Broaden Issues during the prehearing conference t )
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proceedings duly convened and held in Crystal River, Florida, on June 19, 1968, pursuant to duly published Notice of Hearing.
Respectfully submitted, is)
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Dated: June 21, 1968 EDGAR H. DUNN, JR.
Florida Power Building 101 - 5th Street South P. O. Box 14042 S t. Petersburg, Florida 33733 EARRY A. EVERTZ, III Florida Power Building 101 - 5th Street South P. O. Box 14042 St. Petersburg, Florida 33733 ROY B. SNAPP 1725 "IC' Street, N.W.
Washington, D. C. 20006 Counsel for Florida Power Corporation 9
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