ML19331A341

Forwards ALAB-391,ASLB Second Opinion Re Public Disclosure of Nuclear Fuel Supplier Cost & Pricing Provisions. Related Correspondence

ML19331A341
Person / Time
Site:	Midland
Issue date:	05/09/1977
From:	Renfrow R ISHAM, LINCOLN & BEALE
To:	Coufal F, Leeds J, Leubke E Atomic Safety and Licensing Board Panel
References
ALAB-391, NUDOCS 8007160914
Download: ML19331A341 (4)

Text

f ISHAM, LINCOLN & BEALE COUNSELORS AT LAW ONC FIRST NAftONAL PLAZA FOATY-SCCOND FLOOR CHICAGO,lLLINCIS 60603 N

TCLCPHONC Ji2 786-7500 TCLCX; 2-52 8 8 WASMtNorON oFFICc May 9, 1977 ioso im staccr. a.

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at Dr. J. Venn Leeds, Esq.

Dr. Emmeth A. Leubke, Esq.

10807 Atwell Atomic Safety and Licensing Houston, Texas 77096 Board Panel 29 U.S. Nuclear Regulatory Commission p "p.J I Washington D. C.

20555 bO7DO Frederic J.

Coufal, Esq.

Chairman Atomic Safety and Licensing Board Panel U.S. Nuclear Regulatory Commission Washington D. C.

20555 RE:

M_idland Proceeding - Proprietary Date Gentlemen:

Enclosed for your use is the ALAB-391, the second opinion by the Appeal Board on the public disclosure of cost and pricing provisions for nuclear fuel suppliers.

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RRR/rf Enclosure THIS DOCUMENT CONTAINS cc:

Service List (w/ Encl. )

P00R QUAUTY PAGES 8007160 7/y Q

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n s.m Wolf Creel:Statioit 27,CG7 j-DECISION NRCI.76/11 SSO. As at least impI!ritty au-thoriscel by AI.An-327 the appbrants f.h-l I

Al#51 18. 1977 a umtion scckim: riview of that or.ls r.' un A

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(Al.All 301).*

Dsccmber 21, In76 we granted the m.. tion and c3tablished a bricting schr lutc.' On Returning to us for a second, time is the gn;; enns;A ration of the an:uments tranceil controver<y w hich has ari-en ni tln,s con.

in support of and in r*pposition in the drei-stn cti c permit pincrilim: re factur: whether siini 1.clow, we afGrm in part an.1 reverse the applica.it.+ whnuld be compe llol, m re.

in part.

sponse to a di*rovrry dcinas.d made by the

[.02 Durdenof Proof]

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t.. make pu!lic, disek.sure of g g g y,g,,,g,g,,

,p, entered,the plicants had the af.innative buriter on the '

of the co t an.! 3 ricme, pn.vt-:nns (y nuc!c r farl >upply contract mto Wm Whh h ky w N'm the t r.imehouse Elec.

liy thent ilves'and,The,harkgtmral of the In.u<e might sufier competitive injurv were tric Corp.v.a:an.

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, g4 contr..yem an 1 the ;.mie es which govern its l

tract publicly disclosed. Our scrutiny of reu.h:ine are tully devrh.p d, AI.All-327.

the record convicees us that this Ididen 3 NIM *.tdS (l'f6), and rr.ju,,r:

tre no deladed was not met insofar as potential itinry to trpetition here. It is sunicient to restate the applicants is concernerl. Tbc only real ll.c conclesmns there reached:

que tim is whether the pos ihility cf harm (1) in support of their claim that the to Westinghouse was demonstrated with the t

contract pri visions in issue were entitled requisite degree of particularity.

5

- in receive protectim against pnhhe shs.

The starting point of our inquiry is the I

clo ure, the aphcant;s ha,d betu reqmred mye. of.the contract itself, which"l ecame to c<taf 4ish, vitcr ahe, that ths te is a

' rational hasi/ for treating :ss con 6.!rntial eticetive m Cecember 1973 and appcars to the cost and pricing prouvions of nuctsar have a life span of 20 years. Spec,tfically, fuel supple contracts; i.e., that significant the contract covers two major coinponents commercial injury might he su<tained by of the fuel supply which will 1c ret:nited to one or more of the parties to such con-operate the Wolf Creck facility: (1) catu-tracts were those prosi>ious to be publicly ral (i.e., unenriched) uranium; and (2) disclosed ;

fabricated fuct assemblics. The dual nature

(,,,

(2) no suelt showing had been maile; of Westinghouse's undertaking is of present (3) in the circumstances of the case, risincance because it is conceded that that the applicants were entitled to a second company is nci longer "makm future sales i

opportunity to make the showing; and of stranium to utilities" (Tr. SN*.O. Given (4) if the applicants successfully availed I

themselves of that opportunity, p'ntcctive nudiouac is n t now m competition wuh r

treatment then was to be accs.rded the other concerrs for contracts to supply natu-t cimiract prosisions unicchuurc.

Westim;hou>c's hurden on this p'iase of 3 NRC at 417-18. The matter was remanded the matter was especially heavy.

g to the I.icen>ing lioant for further con.

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In an endeavor to satisfy that bur len, sider.um, n m confonmty with thee conthynns, g.cninchmue (through the applie.nita 1.re.

t On November 24,10M. Follmvim: an a.hti.

scuted the tc<timony of two or its uf.eials:

tional evielentiary hearing. the 1.icensim: Sam W. Shsthy,' tile Gensral 11anant of

[ ) Ihtnl entereil its onter on the reinand, in W. iter Reactor IEisiniis alarl.i tieg; and

\\f whic!: it determined h> a divi.l..I vote that Rahert A. Wic>rmann, the l!.uiamr of i

public di>cto<ure was required. l.Ill'Je W. I.icensing l'rograms in the Nuchar Sairty t

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• The divtosuae tasue first c.mv tefe.re us on tVr.t;ne the sautswuc of stic retn irst t Ls rein an nepti.uth.n for etircried evrtoiva'len of an direct st a.ut turther provhlest th.it. Sb*t.I the i

cartl.r nester of the I.!crutin t'eint w h!rh 1.9.s talm: I:sunt again rute agains t the..;P3b In.t tequirest the appiteants t.

s..mply ullis the e int s' clatus, the st4 es gmo w as t..

t.. re sici.

l thienenor** tlLm ery att m.ar t u it b.ut tenent 1.one1 for a tvtl.nl e.f 11 i!.ns 't* ruve'e t he

I J I est i l. t te.n nts.n fuather ellee.ure. Tn applicants f.e apply, sho sht they b. u in.Gmst.

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all'V Mu'.cient Ilmo for eeur enrA.*cr.ition mut fer fuisher retsef (nun this it unt*

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• thtwitt..n e.f the matter. w e pe nniptly e nf rir.I at 11 9.

r's intetim t ratnthe unicr. See.grat: 3rf. 3

' t is tal.tm; this action. we rst n l. t the 1

l hlh' 17 t t W in.\\taliM.*, we dwis ed ttut Inis sim pn.tiethe unter tes.thute the es.o.t of i

the pn.tnihe i.rder shoubt ominutee in c.%vt o.ar dsyb6un tare (n. i a*rped.

j Nuclear Rci:nt.stion Reports y 30,177.02

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I 27,Sti N!!C Decis'ons n s.2 n i

I Department of the Pressurired Water 1:c-sions addo ssed to fabricated fuel a< <mh:;rs.

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actor Syrtimil>hisi..n. The thru t ei their On the first score, it nut t be empha.irc.I testimony was that exact 1.nemleder e.i the that nur hol. ling rests c.srInsisclv n: c.::r f

details of the co-t an.1 pricing 1.royi3 ions of appraisal nl the rimtent of this t ecar.l.

I the contract inicht convey to a ceiintictitor Nothine that we have sa:d shoubt he ta!.rn t

useful iniormation 1,carin g upon We3 ring-to imtel a livlief t!iat in no circumst:mecs practiers in get.crat aml coul.! the public disclosure of the co-t and '

I h<we's hu incu pricing stratrnies in particular. W. hase pricing terms of a particular contr:irt ran-4 cxamined this evidence with con 3iderahic. competitive injury to c.ne c.f the contrnetina care in quest, of specif:es with rc*,mrd to partica in some area ni busincu rini.av..r precisely haw a liresent or inture con:prti-nr,t embraced by. that cr.ntract. !<ather.

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I tor of Wotinghouse in some cc,mniercial the rc<uh we reach on the natural tiranium Gehl othcr tiran the supplying of natural partian of the enntract before us rc<ts en-uranima might be advantagrd by access to tirely on onr conviction that, in this in-those terms of titis contract which rdate stance, there was a failure of prrmf ont the exchtsively to the pricing of natural ura-part of the claimant > ior erw.fidential trc: t.

nium. That quest has been in vain, The ment most that we have found are smuc broad

[.03 PublicIntere t]

i conclusory statements, totally wantuig B. What is icit fr.r.lecision is whether, as in any meaning (n! supporting detail. That to the fuel fal.rication provi inn <, there are plainly does not sufdce.

• • *' "C I" The situation is otherwisc with respect weigh th pote,utial,hann to M.d.py out-

• • "' 'I j

to the cost and pricing provisims directed r-tmrliouse to the furnishing of fabricated fuel assem-s,um. _E ch smght inure froni such

• '. whi blics. Although the witnesses might have cc p 3, n@ In c ur uey, a nya-furnished a more.comprehevisive explana-twe answer is requed.

j tion of the manper in which a competitor In A1.All 327, sterra. we trick note < f tl c in that line of endeavor might in.c those 1

provisions to the detriment of Westing-suo stente reliance of the 1.icensin:: near1 house, there appears to be enough in the in its Grst order upon Irth the First Amind-record to compel the conclusion that there ment to the Constitution and the antitrmt las.

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is a real (and not inst theoretical) possibil-For the reasons developed in that deci i.vi, j

ity of such detriment. Westinghouse still is we rejected that reliance outright. 3 Ni:C t

soliciting contracts for fuct fabrication serv-at 414-15. Nonetheless, in the more recent

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ices ami, indeed, has a heavy investment in order now under resiew, the Chairman of l

facilitics designed to provide tho-e services. the I.icensing Ileard.apparently speakim: for l

Even if (given the age of this contract) it himself alone. has once again pointed to pur-might reasonably be assumed that the prc.

perted Fir >t Amendutent and antitrust coa.

siderations to buttre.s his condusien thst cise cost ihmres contained therein would no longer obtain in any event, allied with those pnblic di.sch.<ure is mandated here. NNCl-figures are price adjustment clauses. On 76/11 at IESS. As on the prior occasion, their face, the clauses ilhune Westinghouse's none of the partie.< has endorsed his vic.o in pricing stratedes as applied to fuel fabri-this regard. And justi6 ably so.

l cation services and give suintantial cr.lence insofar as the l'ir>t Anwndment is con-to th,e concerns trticulated by the witnesses, cerned, we I. ave been dven no can<e ta clah-was said in Al.All G-j 1 or its part, the no-4-ex..mination ei Estrs.,

or. ate upon whatg e hm bem hierd, hnweve otl,ier part,I Wi semann by counsel for theies (y ho adduced no ath w

. cedre Jtion of the Shelby am l

evidence of t,uei own) did rot to any extent in M 6 1.1o-P.med Wir- '

fi studermme the tenttimacy of thoa.c conectns.,

.s thinhine re. tar ling the tv.<iNe att -

ention of the amitrii-t laws,' i'et the c't" it di I

In sum, we agree with the !.iecnsing is unper3ua<ive. We di3cern no:hin" in any Iloard that a rational basis has not been of the deci< ion < cited by him which uht establi.hed for treating as contidential the he taken to stand for the pre;.0,iti..n that natural uranium co t and pricing 1.emi i.ms there are antitrust implications attrn U"t of the contract but cannot accept the I:.e. ors upon the unwithnene-s of a comi..ms-tg like conclusion with n spect to the provi-have its competit..rs ! carn of the to I a"d

' terms of tho om'ract "niar givlate'* th't t'f"T pile.utn fint fs.tt clow tre o' t

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• In.\\l.\\tt 35. w'c omun. ntest iipost the faiture

"# I"*b of tne IReitalmt it.1r.1 to hme estein t.st ut*m the tuht stancinent in its first utsler that the

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frtreetsient t eture*g Wottnghou:e anst trae JP*

H 30,177.03 O 1977, Commerce Clearinc !!onre. Inc.

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es5+n Vermont Yankee Station 27,0G0 f~

pricing terms of a net:otiated contract which crat a:rrement with the siews eq,... 4 it has entered into with third partic<. Those by.'st r. Kr,ruhlith.in hi di. rutim...;.

deri 1.;ns dealt ce.cntially with allenrd en-hth w ( NiiCl 7tVll at *Pl '87). wlu.h v.

dcavors by two or mrere consprtitors in a also h.sd the cmlon.cment of Dr. And.w..,

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market to f x pricc4 for particular gnc 1< er

(~d.atPrd),

services sold in that market. To the c. stent that there was a cimdemnation of <reecry.

For the furet:oint; reasans. the r r.1 r e.

the contett was its use in aid of price fhing der review I4 06rmed in p:nt an.1 r.;vr..

mereng the comrctifors t!smer!res. In the case part. The furties are to emlear..r t..

i...

before us. there i< of course no sm:gestion agreement amnne th(m t!ves, withm.S.

.s that Westinghouse's.lcsire to withhnid. of the date of this desi.< ion, tr>lvctme t:..

pricing information from its compctitors - ~ resisi..ns in the ont>tanding intt rim t t. '.s mirh! serve as part of an attmpt--invo! ring tive onter frec Al Alt.4~. sutra) ul kh.-.-

both Westinghouse amt the competi'c.rs-to called for by our determiratir.ns hersin. T;-

fix* prices in the fabricated fuel assemblics substance of any such :greement >b's ! <

market.

communicated to this I;o.trd pron.pt!v. In the event of a faDure to scach pun i t.

In these circumstances, the matter comes n,tinn # itays of the date of slus dce. -a down to whether public disefosure of the the parties shall (de memoranda w e:::-.-

cost and pricim-terms of the fabricated fuel I'".I8 '"' # (#80'C'.'" MUmn its rcceipt and assemblics portion. of the contract was re.

ter i

l riuired either (1) to enahic the Licensing Board to dischars:e properly its functions, or thy snbunss, ion r sutumnicnp t!n< Ur.ml w H enter a pennanqu pustective mdv. In (2) to furnish the' citizens of Kan<as with the, m,canwhile. the mtcrnn order shall re-data which the public interest requires they

• • • '" I"U

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possess. In resolving this point in Wciting.

house's favor, we need simply note our gen.

It is so ORDERED.

l CCH VERMONT ; ANKEE NUCLEAR POWER STATION, ET AL f

[7 30,178]

j l

") >- For prcvious decision, see 5 30.I71.

Environmental consideratiens-Nuclear fuel cycle--Cost-benefit balanc-i*

l.

ing.-The greater the investment in a particular facility the smaller the p. i-hility that the numerical values assigned to the envir'nmental c!Tects of the i

nuclear fuel cycle couhl have the effcet of tipping the overall cc,st iene..t balance against the facility. Moneys alreaty spent are irrelevant on!v v.hcre l

the NEPA comparison is between (1) completing the propc, sed facility and j

(2) abandoning that incility and not substituting another facility for it.

i

.01 in the hf atter of Vermont Yankee Nu-Generating Station. Units I an.1 2).

i c! car Power Corporation (Vermont Yankee Docket Nos. 50-354 and 50-355. Pine -

i Nuclear Power Station), Docket No. 50 271 vania Power and Light Company tkv-5 t. rt i

P d,lic Settice E!cetric and Gas Company hanna Steam E!cetric Station. Uni:

I (Salem Nudcar Generating Station. Units 2). Decket Nos. 50-3s7 and 53-M IV -

I and 2). Dochet Nos. 50-272 and 50-311.

Powtr Company (Catawba Nu. ic.it.4 -.

Ur.its 1 and 2). Docket Nos. 50 s t.'. '.

h' ] Philadelnhia E!cetric Company (Peach Bot.

tom Atomic Power Station. Units 2 and 3).

50-414. Georr,ia Power Company (Ahn b Docket Nos. 50 277 and 50-273. Idetropoli-Vo;;tle Nuclear Plant. Units 1 d, ' '.

l tan Edison Company, et al. (Three fdile Docket Nos. 50 424 am! $0-425 P-i Island Nudcar Station. Units 1 and 2).

Service Company of New llamraire. et F-Docket Nos. 50 2M and 50 320. Duquesne (Scabrcok Station. Units 1 an.t 2). De IIcht Company. ct al. (Beaver Valley Nes. 50-443 and 50 444 Unden 11. * -

Power Station, Units 1 and 2). Docket Company (Callaway Plant. Unif-I.

i Nos. 50-334 and 50.412, Philadelphia De,het Nos. STN 50-uJ and S'i !. :

i E!cetric Company (I.imeri6k Generating and Tennevec Valley An:l erry ( 11 * !

I Station. Ifnits 1 and 2). Docket Nos ville Nuclear Plant, tini:. I A. 'A.15 -

l 50 352 and 50-353. Public Scryice E!cctrie 2 11 ). Docket Nos 50Sts. S'MP'. E %

and Gas Company, ct al (llope Creek and 50 521.Memorandumand Order. A'

'j 3 0,17 C.S 1 t

Nue! car Regulat on Reports

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