ML19331B041

Opposition to Saginaw Intervenors' Petition for Cost/Benefit Analysis re-assessment.Intervenors Did Not Appear or Participate in Environ Hearings & Petition Lacks Merit &/Or Justification

ML19331B041
Person / Time
Site:	Midland
Issue date:	02/04/1974
From:	Reis H CONSUMERS ENERGY CO. (FORMERLY CONSUMERS POWER CO.), LOWENSTEIN, NEWMAN, REIS, AXELRAD & TOLL
To:	US ATOMIC ENERGY COMMISSION (AEC)
Shared Package
ML19331B038	List: ML19331B037 ML19331B041 ML19331B044 ML19331B049
References
NUDOCS 8007250739
Download: ML19331B041 (8)

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UNITED STATES OF _;RICA 4 jg74 P T rm -5 ATOMIC ENERGY COMMISSION ( ,\ M-

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) Construction Permi s CONSUMERS POWER COMPANY )

) Nos. 81 and 82 (Midland Plant, Units 1 and 2) )

OPPOSITION OF CONSUMERS POWER COMPANY TO PETITION TO THE ATOMIC ENERGY COMMISSION In accordance with the direction contained in a telegram from the Commission dated January 29, 1974, Consumers Power Company (" Consumers Pcwcr" or " Licensee") files this Opposition to the " Petition to the Atomic Energy Commission

(" Petition") filed by "the Saginaw Valley, et al, Intervenors" and the " Sierra-Saginaw Par.itiacars" (collectively the "S agio w Intervenors").

The Petition moves the Commission "for the entry of an Order requiring a hearing on reassessment of the cost-benefit analysis in connection with the proposed Midland facility . . . ."

(Petition, p. 7; see also pp. 1-2)

The alleged basis for the request is "a radical change in underlying economic facts which so upset the previous cost-benefit analysis as to render it meaningless for purposes of enforcement of NEPA obligations." (Petition, p. 2) The alleged " radical change" results from the increases in cost projections for the Midland Plant over earlier projections

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and the resulting increase in the projected cost of process steam to Dow Chemical Company ("Dow"). Accordingly, it is argued that "it is improper to continue to rely upon the prior cost-benefit analysis as a justification for continua-tion of the plant." (Petition, p. 6)

The Petition suggests a number of alternative contexts in which the requested hearing may be held.~1/ Yet, whatever the procedures suggested, the Petition must be regarded as 2/

a request for a partial or full reopening of the NEPA-3/

phase of the construction permit proceeding. The decisian to issue the construction permits "became final some montha ago . . .,

and petitions to review are now pending in the United States Court of Appeals for the District of Columbia 4/

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Circuit.

In these circumstances the Commission would be expected to seek remand of cne proceedings from the Court anc reopen the matter enly in the most extraordinary circumstances.

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~ "[Iln an ind ipendent hearing, in connection wich tne Shcw Cause proceeding, or in connection with the Atomic Energy Commission's continuing obligation to monitor Dockets Nos.

50-329 and 50-330 in order to enforce obligations under the Atomic Energy Act and the National Environmental Protec-tion [ Sic] Act." (Petition, pp. 1-2; see also p. 7.)

-2/ In passing, the Petition indicates that the hearing might also consider, in addition to cost increases, "the reliabil-ity of the Midland nuclear f acility" (p. 5) and " current energy conservation principles which may decrease further the need for electricity or steam . . .

(p. 6).

3/ The National Environmental Policy Act, 42 U.S.C. S 4321, et seq.

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~ See Commission's Memorandum and Order of January 24, 1974, concerning " energy conservation" issues, at pp. 1-2.

As we demonstratc below, the Petition fails to supply any justification for such action. Moreover, as the Commission has noted, the Saginaw Intervenors "did not appear or partici-pate in the fourteen days of environmental hearings . . .

leading to the issuance of the construction permits. In view of these " serious procedural defaults by Saginaw . . .," the request for new hearings at this late date comes from them 1/

"with ill grace."- However, even if those defaults were dis-regarded, the Petition is lacking in merit.

At a minimum, NEPA does not encourage the proposed reassessment; and support for the proposal is not provided either by NEPA or by any authoritative interpretation of that Act. It is not the basic objective of NEPA to require federal agencies, not other tiae obligated to do so, to take action in response to subsecuent day-to-day fluctuations in the cost-benefit balance casociated with activities which they have authorized by final acticn. The cost-benefit analycis re-quired pursuant to 102 (2) (C) of NEPA (42 U.S.C. 4332 ( 2) (c) )

relates to " major Federal actions significantly affecting the quality of the numan environment" . As Senator Jackson, the sponsor of the legislation, emphasized, the purpose of NEPA was "to insure that in instances where a proposed major Federal 1,/ Commission Memorandum and Order of January 24, 1974, l

pp. 19-20.

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action would have a significant impact on the environment 1/

that the impact has in fact be en considered . . . ."-

To be sure, NEPA requires the consideration of en-vironmental issues "at every important stage in the decision making process concerning a particular action . . . .

Calvert Cliffs, supra, 2 ERC at 1785; accord Greene County

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Planning Board v. FPC, 3 ERC 1595, 1599, 453 F2d 412 (2nd Cir.

1972), cert. denied 93 S.Ct. 56 (1972). Nevertheless, "Despite the breadth of the NEPA, its application is only to the decision making processes of the Federal govern-ment. Similarlj , it does not change the i scope of the decisiens which are to be made by the rasponsible Federal govern-ment of ficials but only the factors which must be censidered in making the decisions which cther statutes and regulations re-quire them *e n>rm " Movement Against Destructica .. Taipe, 5 ERC 1625, 163D (D. Md. 19731 Nor do the Guidelines of the Council on Environmental Quality go further. They too are structured around the basic policy requiring t' at the " potential environmental Impact" will be assessed .n all cases " prior to agency decision con-cerning . . . Ajor Federal actions significantly affecting the quality o; the human environment . . . (40 CFR S 1500.2 (a); 38 F.R. 20 550, August 1. 1973). Of course, the Guidelines 1/ See Calvert Cliffs Coordinating Committee v. Atomic Energy Commission, 2 ERC 1779, 1781, n. 9, 449 F2d 1109 (D.C.

Cir. 19 71) .

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require a reassessment of projects which were " ongoing" before NEPA was enacted,-1/ and this is precisely what happened in the 2/

Midland proceeding.~ However, the Guidelines do not otherwise impose a continuous environmental monitoring duty upon agencies after major federal action has been taken in accordance with NEPA.

We live now, just as we did when NEPA was enacted, in a time of rapid changes in the " human,envirorment." What was plentiful at one time becomes scarce at another. Costs of goods and products vary radically even within brief periods of time.

Judgments about the beneficial or harmful effect of -products-or activities vary with changes in economic and social conditions and advances in knowledge. These considerations militate strongly against any agency duty to reexamine final action taken in compliance with NEPA -- because of subsequent changes in the " human environment." ^ie rvise no decision would aver 53 final. Admittedly the question nas never been directly faced and settled, but even if agencies may have the authcrity or duty to reexamine final action in the light of subsequently chsnging circumstances, such reexamination should be undertaken only rarely, and the persen requesting it must bear a heavy burden, i

The instant Petition does not meet that tes t . Even if the facts alleged should be accepted as true, the Petition would not justi-  !

fy reopening of the proceeding by the Commission.

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40 CFR S 1500.13; 38 F.R. 20556. For that purpose an " ongoing" project is one which was begun before the enactment of NEPA.

Lee v. Resor, 4 ERC 1579, 1581 '" D. Fla. 1972).

2/ That reassessment was exhaustive. See "Brief in Opposition to Motion to Clarify" filed by Consumers Power Company with the Commission on December 10, 1973, at pp. 10-13. In effect what the Petition requests is a reassessment of the reassessment.

Although, as indicated above, the Petition hints at 1/

other " environmental" problems,- the sole basis for the request for a new hearing is the increase in projected costs.

However, costs were only one part of the complicated calculus involved in the environmental analysis which led to the con-clusion that the construction permit,s should issue. This included, among other things, consideration of site character-is tics , terrestrial ecology, water usage, fogging and icing, and the environmental impact of non-radioactive effluents from fossil fuel alternatives.

Moreover, the only costs referred to in the Petition are the costs of constructing the Midland Plant. The Petition fails even to mention the fact that the costs of altern:tivt: --

i.e., the costs of coal and oil -- have escalated so sharply that the nuclear plant remains the most economic alternative in the circumstances. (See affidavit of William E. Kessler, constituting Attachment A hereto.) The Petition also fails to refer to the f act that oil-fired plants are no lenger a realistic alternative because oil in sufficient quantities is not available in the area. (See affidavit of Robert B.

Atwater, constituting Attachment B hereto.)

It is perhaps because of these reasons that, contrary to the implications of the Petition, Dow "is not abandoning 1/ See n. 2, p. 2, supra.

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the nuclear project at Midland."- On February 1, 1974, Dow and the Licensee revised and extended their existing contracts. Dc4 has agreed to purchase process steam from the Midland plant for 20 years after it begins operation, and agreements were also entered into for the sale of electricity to Dow and supplies of water to Midland. There is attached, as Attachment C, a copy of a press release announcing the agreements. With respect to reports that Dow "was having doubts about renewing the agreement," it quotes Mr. Temple as " noting that t'oday's signing speaks for itself. 'We've always believed in and supported the building of a safe nuclear plant as have the majority of citizens of Midland.'"

Finally, the Commiccica is assuredly aware of exicting economic conditions, including the general increases in costs and prices which have occurred in the last few years. Those increases have af fected every large construction project in-volving substantial capital expenditures. If the Midland pro-ceeding is to be reopened because of such increasec, so too must every other construction project approved by the Atomic

-1/ Telegram to the Commission from J. G. Temple, General Manager of Dow's Midland Division, dated January 23, 1974, and contradicting the statement contained in a letter to the Commission from counsel for the Saginaw Intervenors which alleged that Dow is "considering abandoning support for the Midland nuclear project."

See Commission's Memorandum and Order of January 24, 1974, p. 23, n. 28. 1

O Energy Commission or by any other Federal agency in the last year. The logic of the Petition is that, because of recent price and cost increases, no NEPA analysis is adequate today and each must be reassessed in a hearing. The ensuing economic chaos obviously cannot be the objective of NEPA.

Respe,ctfully submitted,

-- / (W Harold F. Reis 1

NEWMMI, REIS & AXELRAD 1025 Connecticut Avenue, N.W. i Washington, D. C. 20035 Counsel for CONSUMERS POWER COMPANY Dated: February 4, 1974 4

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