ML19338C007

Decision ALAB-458 Affirming ASLB Decision Not to Suspend Const

ML19338C007
Person / Time
Site:	Midland
Issue date:	02/14/1978
From:	Duflo M NRC ATOMIC SAFETY & LICENSING APPEAL PANEL (ASLAP)
To:
References
ALAB-458, NUDOCS 8007310569
Download: ML19338C007 (43)

Text

- _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ - _ _ _

,-~

4 M'

UliITED STATES OF AMERICA p

1. e'g liCCLEAR REGULATORY CCIO!ISSICli N

S$.ro

b sc ATOMIC SAFETY AND LICENSING A; PEAL BOARD gj7

\\$]$ > 0 Michael.C. Farrar, Chairman T

[2f.O y

e y

Richard S.

Salzman 6f d **$ 5* d ew Dr. W.

Reed Johnson M Q y a

N 7

)

In the Matter of

)

)

CONSUMERS POWER COMPANY-

)

Docket Nos. 50-329

)

50-330 (Midland Plant, Units 1 & 2)

)

I EU FEB 1 4 374

~

Mr. Myron M. Cherry, Chicago, Illinois, with whom Mr. Peter A.

Flvnn was on the briefs, for the intervenors Saginaw Valley Nuclear Study Group et al.

Mr. Michael I. Miller, Chicago, Illinois, with whom Ms. Carvl A. BarteT. man and Mr. Ronald G. Zamarin were on the briefs, for Consumers Power Company.

Mr. Milton J. Grossman, with whom Mesurs. William J.

Olmstead and Richard K. Hoefling were on the briefs, for the Nuclear R<agulatory Commission staff.

Mr. Milton R. Wessel, White Plains, New York, arcued the cause for the intervenor Dow Chemical Company.

DECISION February 14, 1978 (ALAB-4 58 )

A.

Background and Summarv 1.

In-late 1972', the Licensing Board awarded Consumers Power Company construction permits for the two-unit Midland facility; we affirmed that award several conths b

bhf

~

M 8007810 o

j

m ly:

,.g<-

- C

~

...1/

'later.--

Certain' individual, citizens and groups whc had l

~ intervened in our.proaeeding sought judicial review; in the -

~

Distri'c' of.co1umbia circuit but did not ask for an. interim stay ch construction. ~Consecuently, construction of the

. plant went' forward whila Ehe court of appeals deliberated.

In mid-1976, that court held that the administrative -

2/

proceedings 1had been defective in certain respects.---

As

a. remedial measure, the court remanded the matter to the Commission for further proceedings. 3/

The Commission in 1.

r turn-assigned the matter to a licensing board, telling it to explore.not only the merits of the remanded issues but also whether the construction permits 'should be suspended -in the 4/

interim.-~

l L-1 /' ALAB-123, 6 AEC 331 (19.73), affirming LBP-72-34, 5-AEC 214 (1972).- Construction had actually begun in 1970 i'.

under a special exemption the applicant had obtained

- from:the Commission.

2_,/ ' Aeschliman v. Nuclear Reculatorv Commission, 547 F.2d 622 (D.C. Cir. 1976),-certiorari cranted sub, nom'.

Consumers Power'Co. v. AeschlimanT 429 U.S. 1090 (1977).

l

'3/

147lF..d at,632.

2 t-f4 /

See CLI-76-11,.4~NRC 65 (1976) ; CLI-76-14, 4 NRC 163

' ?--

(1976).

i i

y

'c.-'

r.

y 4

~

^

n

% 3 2.

.The~ court's remand crder covered a variety of topics.

.To begin with, the court found two defects in this agency's appraisal:of the environmental impact of constructing and operating the Midland plant.

First, that appraisal had failed to take account of the environmental impact of 5/

the nuclear fuel cycle.--

Second, it had not adequately-considered an alternative to incurring the adverse environ-mental impact: attributable to the plant, i.e.,

the possibility that energy cons.ervation might reduce or eliminate the need 6/

for a plant of this si=e.-

In licht of the need for a remand on -these two subjects, the court added that it expected us. also te consider whether s

changed circumstances had affected'the Dow Chemical Company's

]

need for the process steam which, according to existing contract,

- 7/

it was to receive frein one of the units.-

This issue is-

.j

_5/

The fuel cycle refers to the gamut of steps ---from the mining of uranium ore to the handling of radioactive waste:-- involved in the~ creation,'use and dispo 71 of reactor _ fuel.- On this count the court simply incorporated (see 547 F.2d at 632) its-decision in Natural Resources Defense Council'v. Nuclear Regulatorv Commission, 547 o

F.2d 633 (decided the same day), certiorari granted sub.

nom. Vermont Yankee Nuclear Power Corp. v. NRDC, 429 U.S. 1090 (1977).-

s 6/

547.F.2d at 625-30.

7/ '547-F.2d.at 632..

w

_M' w

a

-4

A significant :1n that the applicant originally selectn' the Midland ' site and ' ecided to -build two units instead of one d

there because'o'f its/ plans to supply steam'to Ocw (which s/-

also purchases 'large amounts of electricity frem the applicant);-- ~

The court's decis' ion went beyond environmental matters;

~

it also called.for'further consideration ofca safety issue.

Specifically, it held that-the report dhe Commission had received from 'its Advisory Committee on Reactor Safeguards

'g /

'ACRS) -- required by statute for every_ nuclear power plant--'--

was-unacceptably vague in indicating a need-to rerolve for the Midland facility "other problems"- (not there further identified) common;to reactors of the Midland-type generally.

/

10 3.

After < taking evidence _ for sone thirty hearing days (spread over ~the period from NovemberL1976 to May 1977), the Board below issued a decision on Septenber 23, 1977, declining 11/

torsuspend the~ permits.pending its decision on the merits.--

Thatfdecision is now'before us for review, with the intervenors 4

g /- 547-F.2d at 624; Final Environmental Statement (March 1972)',

p. XI-3.

~!

9 /, ' 42 K U.S.C. 20 39,; 2232 (b).

. 1_0_/. 547 F.2d.at 630-32.

1_1./f J LBP-.77-5 7,16 NRC 4 82- (19 77).

J-

p sw p

4

.a-<

I

.l.

.:-).

v:. 12 / -

asking us to' reverse-it and.to order the permits suspended. -

.Having. heard oral' argument and. fully consider.ed the matter, we' conclude ~that the circumstances did not warrant suspension of the permits pending the-outcome of the. reopened

[

i-hearing.. This' conclusion rests mainly on our judgment that the: environmental issues being explored on the remand, i

although important in principle, are-proving to be of little practical consequence in. Gis case -- particularly as there

.does not' appear _to be-any. environmentally-preferable alterna:ive-tio the proposed Midland project.

For that reason and the

~

others set out below, we affirm the Licensing Board's decision not to-suspend construction.

]

B..-Applicable Standards.

At the. outset, we note our agreement with the-Licensing Board (6'NRC_at 484-85) that the suspension question-is not J

. controlled by the familiar criteria' enunciated in virainia

'13 / -

~

retroleum Jobbers v. FPC.~-

For example,.the first of those-1 criteria, applicable when-an unsuccessful litigant seeks a

. stay _of a decision in'his opponent's favor, is whether the' 1

f l

1_2_/

The intervenors filed exceptions with us and then sought.

j summary : reversal or : suspension of the permits pending their appeal from the-decision below; they then' briefed their-appeal, which seeks suspension of the permits

.'pending the-outcome of the merits of the remanded' hearing.

Our decision today disposes of all the matters put before us.

..n/

259.F.2d.921, 925 (D.C. Cir. 1958).

j i

~

(

6-2 movants have made:a strong showing of.their probability of

--success on : thel merits.

Here, when the intervenors sought relief from the' Licensing Board, they were past that point and in a far~ stronger position -- they had already been successful in exposing defects in the. prior. proceedings, leaving the applicant without presumptively valid permits in hand..

This,did not mean, however, as the'incervenors would have it,.that the relief they soucht -- suspension of the permits --

.was required "as a matter of law" by virtue of the court's decision alone..The Commission, in this very case, squarely

. rejected that approach in favor of requiring. that all relevant -

equitable. considerations be taken into account.

CLI-76-ll, 14.NRC 65 (1976) l(referring to the General Statement of Policy,-

j l

41 F.R.=34707, 34709 - (August 16, 1976) ). and CLI 76-14, 4 NRC

. l (1976). u/

163, 167 And the Commission's method of analysis seems to have at-least the tacit approval'of the court of.

appeals. - For if theTrule were as inflexible as the intervenors say,e that court would hardly have (1) said'nothing about a

. halt to construction' in 'its original decision (it simply 4

s 14 [ See also Public nervice-Co. of New Hampshire (Seabrook Units 1: and 2),..CLI-77-8, 5 lIRC 50 3,. 521 (19 77), focusing on "(1) traditional balancingiof. equities and (2) consideration-ofLany likely prejudice to further decisions Jthat might:be. called-for by the remand."

a 1

~"

~

4 1

-~7 renan ed d'the "crders granting construction permits" to the d

Commission for ' further proceedings)- / and'(2) denied.the 15 inte venors'-motion for' suspension more than a year later.--IV'

~ Indeed,f on the latter' occasion the court reaffirmed tb.t its

~

mandate."hasinot itself requi

.d a cessation of construction" and that that: decision is for this agency to make.

The.

decision whether to suspend thus turns upon the peculiar circumstances of this case.

- The first of.those circumstances is that the proceedings leading to the award of 'the permits were defective.

But we ought to take into account just how serious those i

defects,re or might prove to be.

Many times, such an l

assessment may involve highly theoretical considerations.

1 l

In this case, for example,-both of the defects the enurt found j

~

l invoi re, Lon their face, matters that could be extremely serious;-

J and. al sent any other informatioil, we would view them that way. ;Indeed, those opposing-suspension -- on whom the barden of proof rested throughout the construction permit proceeding

-- must shoulder a doubly heavy burdeit if they would dispel the negative impact of'the court's. holding.

But we need not I

I y

547 F.2d:at'632.

I

16/ : Aeschliman-v. MRC, unpublished order of October 27, 1977

~

(Docket Nos..-7"s T776 and 73-1867).

5 5

w t n

s-

• '4 4no

,.-y

_8-operate rhere. cn theory alena -- wa-have the benefit both of supervening events and of the evidence thus-far introduced 17/:

before the' Board below.-~

We turn, then,'to an analysis of

- the gravity of the questions being litigated.

C.,

The Seriousness of the Defects.

- Although' in theory the remand hearings have dealt.

only with the question of interim suspension, the merits of the. remanded issues have naturally received considerable attention.

Indeed, there has been no clear demarcation between the evidence relevant to - the one and that bearing on the.other of these. questions -- as demonstrated by the fact,that, after it issued its order declining to suspend the permits, theyBoard below suggested that little additional 18/

q evidence might be necessary on the remanded issues.

'I

)

Because not all the parties accept this assessment, our comments can be only tentative.

Although we would certainly prefer not 17/

We do not suggest that a' decision on-interim suspension can always be postponed long enough to allow the trial boarc to amass.'an evidentiary record of the size compiled

' here.

Circumstances will more often demand-that at least' a tentative decision be made more quickly and that it

~

~

remainlin effect while the full-dress suspension hearing is held- (just as-the courts m.:1t often pass quickly on a i-

- request for a :terporary ' restraining order and consider then in:less~ rapid' fashion whether a'preliminaryfinjunc-

-tion islin. order).

At intervals during the suspension hearing, the intervenors complained;of the lack.of a speedy decision -- but when we. invited them to detail their complaint (see ALAB-395, 5 NRC-772, 784-86'(1977)),-

they did not do so.

M /

SeeLone of its unpublished orders of November'4, 1977.

K t

e y-4

)

e 4

w e

-A 4

+

y

. e 19/

to~ delve ~. deeply into the merits at this jur.cture,- we must consider in any decision en suspension how the violation that prompted the remand will affeet the ultimate outcome of the iproceeding; and we should use all the information

~available to us in making that appraisal.

We approach that information in a different manner than did the Board below.

At-the suspension hearing and in that Board's decision, extraordinary attention was paid to the relative-financial costs of various alternatives.

But there was no serious suggestion.that any of those alternatives f

was-preferable to Midland from an environmental' standpoint.

l l

In other words,'no evidence was adduced discrediting the earlier. findings that the Midland project will not degrade

_2 any; areas that either are particularly -attractive or otherwise need to be sheltered from a project such as this; that its overall environmental impact is relatively small; and that,:in l

~

L any event, _ its impact _would not be lessened were the nuclear 2D! -

l facility built elsewhere or a coal plant substituted for it.

I I

19/ :Cf. Washington Metropolitan Area Transit Commission v.

Holiday Tours, 559 F.2d 841, 844 (D.C. Cir. 1977),

referring,.in a somewhat different context, to the desirability of avoiding "an exaggeratedly refined analysis of't.ne merits at an early stage in the litigation."

M/, _5 AEC f at 223-28. -

l'

f Ij e

This being so, we :do not perceive that financial. matters 1

-are.a's' crucial as the Board.'below thought they.were.

Unless 5he' proposed-nuclear pl' ant has environmental disadvantages in comparison to possible' alternatives, differences in financial

~~

cost are of'little con'cern to us.

Because a line of our earlier decisions leads us-directly to this proposition,- /.

21 we need: record our underlying reasoning only briefly here.

In the Atomic Enercy Act, Congress did not make this agency responsible for assessing whether a proposed nuclear plant would_be the most financially advantageous way for a utility to satisfy its customers' need for power.

Such matters remained the province'of the utility and its~ supervising state regulatory commission.

Antitrust issues to one side,.

our involvement in financial matters was limited-to determining l

whether, if we license the plant, the company will lua able

~

4 to build and then to operate it without compromising safety-22/

j because of pressing-financial needs.--

The passage of the National Environmental Policy Act H

increased our concern with the economics of nuclear power

. plants,:but only in a_ limited _way.

.That Act' requires us to fl/ l Northern Sta 'es Power Comeanv (Prairie Island Units 1 and.2),-ALAB-244,-8 AEC 857, 862 (1974) ;. Illinois Power

~ Company ' (Clinton. Units l an.: 2), ALAB-340,:-4 NRC 27, 48

~

c(1976); cf.. Tennessee Valley Authority (Hartsville Units-

- lA,:-2A,y and : 2B),' ALAB-36 7, 5 NRC 92, 102-03 (1977).

22f 1See.Public Service Company of New Hampshire (Seabrook' Units 1 and.2),-CLI-78-1,- 7 NRC.

(January 6, 1978) (slip

'-~ '

opinion, p.225).

'l A

Q 4^,o g#

M

_A 4

-m,

=

1 "L -

p.

~

_ 11 _

3 consider whether there are environmentally preferable alter-

~ natives!to the proposal before us.

If there are, we must 4

l take the steps _we.can to.see.that they are implemented'~

if that can-be accomplished at a reasonable cost; i.e., one not out of proportion to the environmental advantages to be

~

gained.

But if there are no-preferable environmental alter-natives, such cost-benefit balancing does not take place.

Manifestly,.nothing in NEPA calls upon us to sift through-environmentally. inferior alternatives to find a cheaper (but 24 /

dirtier) way of handling the matter at hand.--

In the scheme 23/~ If the alternatives involve a different way of constructing-a portion.of the nuclear plant in order.to deal with a particular environmental problem, we can condition the permit to require the optimum alternative.

See Vermont Yankee Nuclear ' Power Corporation -(Vermont Yankee Station),

~q ALAB-179, 7-AEC 159,- 175 (1974); Public Service Company of 'cTew Hampshire.(Seabrook Units 1 and 2), CLI-77-3, 5 IIRC 503, 528 fn. 25 (1977).

If the alternative involves a different site or a non-nuclear facility, we cannot-

directly--require the' applicant to adopt that alternative j

but we can deny permission to proceed with the proposal submitted to us...See Seabrook, CLI-77-8, suora, 5 MRC

- - ^ ~ - -

at 529-30.

24 /. 'Although we-have not been directed to, and have not-found,

--~

t -

1any judicial decisions ' squarely on point, the emphasis in the NEPA cases is ' invariably upon the _ need for federal-agencies.to investigate and to. discuss alternatives which would result'in-lesser adverse environmental impact than the proposed project.

See, e.a.,

Sierra Clut v. Morton, 510 ? F.2d 813, 825 - (5th Cir. IT75) : - " federal exploration would'present substantially the same environmental

' hazards as ' permitting. private developers to e:cplore the

' tracts sold.L An alternative which-would result in similar or creater harm need not be discussed." (emphasis added) ;

.(FOOTNOTE CONTINUED ON HEZT PAGE) r k

y

= - - +

4p

(

7

r of things,-we leave such matters to the business judgrent of:the' utility companies and to the wisdom of the state

-regulatory agencies responsible for~ scrutinizing the purely economic aspects of proposals to build new generating

. f acilities.""st' In short,nas far as NEPA is concerned, cost

.n is important only to the extent it results in' an environmentally superior alternative.

If the " cure" is worse than the disease, that it is cheap is hardly impressive.

j With this understanding we have examined the potential significance of the issues being heard on remand.

We conclude,-

on the basis of what was before the Board below, that they H

are of little-practical importarce, j

i 21 /.(FOOTNOTE CONTINUED FROM PREVIOUS PAGE) j NRDC v. Morton, 458 F.2d 827, 836 (D.C. Cir. 1972):

"We reiterate that the discussion of environmental effects of alternatives need~not be exhaustive.

What is required j

is information sufficient'to permit a reasoned choice of alternatives so far as environmental aspects are concerned."; State of Alabama ex rel. Baxley v. Corps

'of Engineers, 4 1 F. Supp. 1261, 1274-(N.D. Ala. 1976):

NEPA. requires an agency to consider ' "those alternatr'es reasonably calculated to reduce en.vironmental harm * - *'

25/L In'other words, neither NEPA nor any other statute gives us the authority - to reject an applicant's proposal solely because an alternative might prove less costly financially.

-Monetary'censiderations come into play in only the opposite fashion -- i.e.,

if mi alternative to the applicant's proncsal is environmentally preferable, then we must de-

- ter.iine whether the environmental benefits conferred by that alternative are worthwhile enough'to outweigh any

~

additional cost needed'to-achieve them.

L

~

~ ~..

-(-

~

..e f.

11.:

Fuel' Cycle.

Developments since.the court's-decision, culminating linsthe Commission's promui:'. tion -of an in -crim amended rule

. 26 /

' on. the subject,-~~ -have. rendered the fuel cycle issue incon--

27 /

sequential.-~~

As we have-recognized in other cases, the Commission's interim rule embodies the view that,~insdfar as

.particular. nuclear plantn:are concerned, the : environmental -

effects attributable to the existe2ce and need for storage of nuclear. waste bring-only negligible weight to the cost

-28 /

' benefit balance.-

And in its. original rule.the Commission had-determined that other aspects of the fuel cycle similarly; 26 /, 42;F.R. 13803-(March 14, 1977).

27 /> The initial licensing of Midland was done without any consideration: of fuel' cycle ' impacts.

After that, but before the court of appeals' remand' order,'thc Commission adopted a. fuel cycle rule which was designed to~ summarize

~

those~ impacts'for~use in each licensing proceeding.- The court held,,however, not only that Midland could not be

~

licensed without consideration of fuel cycle impacts.but als fthat : gaps existed in' the Commission's original rule.

Ser Aeschliman, supra,.547.F.2d at:632;=NRDC v. NRC

-(rapra, fn. 5 : ). - - The interim! amended rule adopted since

'nen was: meant to fill those gaps.. Taken in-conjunction ~~with1the original rule which it modifies,it furnishes a statementLof the environmental impacts of' the fuel cycle which must be taken into account-here.

28 / " Vermont Yankee Nuclear Power Corporation (Vermor t '

' Yankee Station), ALAB-421,;6 NRC 25, 30-32 (concurring

- opinion). (1977) ; Public' Service Company of New Hampshire (Seabrook Units'l and 2), ALAB-422, 6 NRC 33,--102-04

-.(majority-opinion) ~,. ll3 >14 (concurring l opinion) (1977);

Public Service Electric & Gas Company (Salem Units 1 and

2), ALAB-426, 6 NRC 2 0 6 (1977).

r.

s I

1

e,-

owm_

(-

29/

a

' involved ~little 2nvironmental impact. ~

Consideration of-e all the impacts reflected in the amended fuel cycle rule thus-does.not materially alter the cost-benefit balance ori-ginally struck for-Midland with any such consideration.

Like the Board below, we are bound by and must give effect to the-judgments made by the Commission in this regard.

Absent any change mandated by either the Commission (as a result of the rulemakina proceeding now underway to formulate a permanent rule) or the courus, the environmental effects 30 /

of the. fuel cycle must be tr. ken as insubstantial.

29/

See 39 F.R.

14188-91 (April 22, 3374); see also Public Service Co. of New Hampshire (Seabrook Units 1 and 2),

ALAB-349,'4-NRC 235, 238-39 (19 76).

---30/

'There is no merit to the intervenors' complaint that-

.the Board below evaluated the fuel cycle matter without

-d giving them sufficient opportunity to be heard.

To be sure, little attention was paid to this topic during the hearing.

This was natural becausg as circumstances changed, the Commission -- which had at first told the Board below to consider fuel cycle matters (CLI-76-ll, supra,14 EFC at.65, and CLI-76-14, supra, 4.NRC at 167)

-- directed that Board to " defer its consideration pending anticipated adoption of an interim fuel cycle rule", which was expected to "be in place by the time

~

the. Board is prepared to render a decision on the reopened Mcord."

CLI-75-19, 4 NRC 474, 4 ~, 5 (1976).

Once that 1

rule was in place, we -(acting for the Commission in the absence of a quorum) told the Board below to take it into account.

ALAB-396, 5 NRC 1141 (1977).

That Board did so; by the ' time it. rendered its decision, there was nothing raised!

. on which the parties needed to be heard (see the decisions cited;in fn. 28, supra).

~

(FOOTNOTE CONTINUED ON NEXT PAGE) 4 o

i e

n.

15 -

' Thus, while this issue was potentially of crucial inpertance,

.a

-31/

9 it-is- ~no ; longer. a significant factor in this proceeding.--

2..

Conservation-.

The other environmentally-relatsd defect-found in the earlier administrative proceedings was the. failure to g/

-(FOOTUOTE CONTINUED FROM PREVIOUS PAGE)

In this regard, the intervenors seem to press only two points which they believe should have been considered.

As to the first, they are mistR an in asserting (Srief,

p. 27) that there is a connection between the values in the fuel-cycle. rule and the testimony concerning how possible increases in the monetary cost.of fuel might affect Dow's interest in adhering to its contract with the applicent.

The rule deals with only the environmental impacts of the fuel cycle and has nothing to-do with the

. price a utility-may have to pay,to purchase fuel for a proposed raactor.

The intervenors' second point-is.also not well taken.

They claim _ (Brief, _ p. ~ 27) that the rule " rests upon the assumption that plutoniun recycling-will be available"

-(which assumption f they say has now been discredited).

Although we would be bound by the rule in:any event, we note that this claim is sirply wrong.

In adopting the rule, the Commission explained that each of its values reflects the particular recyclihg assumption -- no ~ recycle at all or uranium recycle only -- which would lead to the maximum adverse environmental impact.- See 42 F.R. at 13807 fn. 1.

The a'ssumption that plutonium as well.

as urani'um.would be recycled was therefore.not the basis for-the ~ rule.

. 31/

We hasten to add that, contrary to what the applicant suggests -(Brief, p.- 53), it is entirely inappropriate to relyLfor: licensing. purposes on the fact that "

' the impacts of L fuel cycle issues - do not come into play until'after plant operation begins * * *." 'Those adverse environmental. impacts.-.small though the rule states'them to be.---will inexorably flow-from plant operation..

Consequently, they must be taken into account at whatever ipoint aLcomparison.to other alternatives is being drawn (FOOTNOTE CONTINUED.ON NEXT PAGE)

f ma w.

iG;o

.6

look1scecifically into=the-possible effects of conservation, c<

' the supposition: being that conservation might obviate the need for any plant ~ at all, cr. at least the need for a plant

.of the size proposed._-Of-course, efficacious conservation measures,woulditand tolicwer the projected demand figures.

But because power; demand has historically risen, conservation might reasonably'be expected only to_ decrease or delay growth, L

and not to.leadLto reductions in absolute demand.

Thus its effect could be merely.to postpone the time when a generating plant's capacity would be needed to meet energy demand or reserve requirements, rather than.to obviate that need entirely.-

l In any' event, conservation does not give rist to a separate issua -

it 'is just one factor which must be considered

(=

l along with many others in connection with need-for-power j

l l

projections.

L The ~intervenors tell us that thus - far' (in the suspension-

!^

phase of the remand) they have not attempted to present their

~

own need-for-power projections (although they propose to do'so

~

in the-next phase, _ when-the merits are addressed).

Instead, l

i j

~ as Ltheir witness put it, he decided to take "most if not p

all of;the' Applicant's information.as given and examine it for_

H m_

~

~ 31W '..(FOOTNOTE CONTINUED FROM PREVIOUS PAGE)

' :to avoid the risk that, by ignoring them until operation begins,jother. alternatives will"be unjustifiably foreclosed.

1 k

i e

.; 9, <

~

,s.

j' a

- 17:-

correctness,' accuracy, and suitability to. support the position

I urged by; applicant", rather'than'to conduct "anEindependent

. s tudy ".. 3 2/ On ' this. basis, - he ~ advanced the thesis that, leaving 33-/

.aside1the steam andIelectricity intended for Dow,--

the applicant 1 could meet anticipated demand with one 800-megawatt facility -- which h'e believed should be coal-fired -- in lieu 34/

of the two-unit nuclear facility under construction.-~

In p

other words, ~ t6e intervenors' witness concluded from the applicant's own-evidence that at least one-quarter of the L

projected Midland generating capacity is unneeded.

Other evidence points a different way.

The staff's-testimony, similar to the material contained in its January l

l' 1977 Draft Supplement to the Midland Final Environmental

. Statement, provides an extensive review of power demand pro-a i

jections for the Consumers Power and Michigan Electric Coordi--

L l

-32/

Testimony of Richard J..Timm,.p. 14 (fol. Tr. 16A),

~'

~~

l March 23,'1977.

f33/

He would have Dow produce its own..

But see fn.46, infra.

l

~34/ _'Id.

at 83; but_see fn. 70, infra.

c.

- 18.-

nated ' System service areas.25/

Projections made by several 7

Lother organizations'are compared with those of the applicant,

~

and explicit consideration is given to the effect that conservation might have upon demand projections.

For. present purposes we need not engage in' an exhaus-tive recitation of the staff's conclusions.

Briefly, however, the' staff ebcerves that the applicant's figures are very close to the deman'd projections of the Michigan Public Service Commission end tha Michigan Gow rnor's Advisory Conmission on Electric. Power Alternatives for the applicant's service area, as well as-those of the Federal Energy Adminis-tration for the-East North Central-Region of the United States. 6/

3 With respect.to conservation, the staff notes that certain measures commonly used to promote conservntion, such as 37/

x advertisements encouraging conservar. ion--

and a flat rate 38 structurer / are already in effect in the applicant's area.

35/

The MECS service area consists of that of Consumers Power? plus that of Detroit Edison Company.

. 3.f/ - Testimony of staff witness Feld (fol. Tr. 4375), pp. 9-23; Draft'Stro, FES, pp.

4-15^-- 4-20.

J /

Feld. testimony, p. 23; Draft Supp. FES, p.

4-6.

3 /

Draft Supp. FES, p. 4-8.

m C

y.

e

}V

~.

j "

m91

- 19 In addition,.the staff refers usfto an opinion of the Public i

Service Comdission"sucgesting that the applicant's forecasts have ' tended, if L anything,- to overstate the possible effect

~

~ 39/

of conservation on future growth.-

With respect to such forecasts,. the staff discusses at-length the difficulties of j

attempting to predict the effect of. conservation 'measurhs--/

40 and the'compcting effects that might result as users of scarce fossil fuels. conserve by switching to electricity to meet their

' power needs.- /-

~41 This material, taken with other portions of the record-related'to conservation and the need-for the Midland units, strongly suggests to us that the neglect to identify and consider specifically the effects of conservation in striking

'the original UEPA balance was an error of small magnitude.

The upshot:is that, although.this NEPA violation,'too, was theoretically serious, its actual impact is likely not 42/

~

to be.---

Nothing' advanced se far indicates that conser-39/. Feld testimony, p. 25; Draft Supp. FES,. p. 4-10.

40/

Feld testimony, pp. 23-28; Draf t Supp. FES, pn. 4 - -

7

~4-8.

41/ iFeld testimony, pp.-29-3S; Draft Supp. FES, pp. 4-11 --

=4-13.

42/:.In' discussing-the~ extent of the energy. conservation NEPA

' ~ ~ ~

-viclatien,.the' Board below stated only that "(slubstantially.

less demand could result in the construction of a plant

-not' new needed. " ~ 6 NRC at'488, 125.

We take it that the1 Board was~ simply describing ~ the nature of. the issue 2.ther than furnishing its view of the evidence thus Efar adduced.

r w

w -

7

t i

-~

m vation will'so decrease projected demand that any sub-(3/

stantial-portion of Midland's capacity will be superfluous."-

43 / - After reaching and fashioning this conclusion, we received a letter from applicant's counsel, dated' January 31, 1978, L

informing us. that the utility had just adopted a "new long-term electric forecast for the years 1978_through 1992."

That forecast reflects a downward revision of projected demand,.and'intervenorscannsel has, by letter lof February 2, 1978, argued, _i_nter axia, that it " destroys Consumers' entire case."

We do not think so.

At the suspension hearing, the applicant relied upon a 5.2% annual growth rate in electric power. demand.

The annual growth rate contained in the p

new forecast ~is as follows:

4.4% for the years 1978-82;-

2.8%-from 1963-87; and 2.1% for 1988-92.

The effect of this, for the years that the Midland units are scheduled to go into operation, is.to decrease-projccred demand 210 megawatts in 1981'(from 5560 to 5350 megawatts) and 261 megawatts in 1982 (from 5841-to 5580 megawatts).

As may be seen, this means, that peak demand figures for this period will. lag,about a year behind what was previously

~

anticipated -- instead of a 5560 megawatt peak in 1981, the. projection is for a 5580 peak in 1982.

This error reflects no more than the normal " substantial margin of uncertainty" inherent in any forecast of future electric power demands.

See Niacara Mohawk Power Corpora-tion (Eine Mile Point Unit 2), ALAB-264, 1 URC 347, 365-66 (1975).

And_it does not give us cause to alter

-the opinion reflected in the text.

k e.

~

x; c,

~

3.

The Dow-consumers Centract.

-The current status of the contractual relationship

~

between Dow and tlie applicant uds Lexamined at great length at the suspension hearing.- Although this is-as it should be,

~

we should repeat that:no NEPA violation occurred'here; rather, the court suggested-that.the' record be brought up-to-date on 44 /

this count only because the case was remanded on other grounds 7-The evidence adduced thus.for, which appears to be unusually comprehensive, can be fairly. summarized as follows:

some

~

officials in the local Dow management view Midland as a losing proposition and would abandon it, but the senior corporata

~

officers'have decided, subject to' reconsideration if circumstances change, that Dow will -honor the contract to buy st. am from Midland, notwithstanding that intervening events have rendered.

]

~

45 4

its terms far less attractive to Dow than they originally were- /

For our. purposes, then,.that portion of the demand for 46 /

Midland power attributable to Dow is a given.--

To i

g

_4.y Apparently inadvertently,- the Licensing Board referred to this us the "second NEPA violation."

6 NRC at 486, 114.

4 5 The Board' below seemed to share this appraisal, but it

/

concluded-by stating that "whether Dow will ever buy steam from that plant is, on the record, speculative."

-6'NRC at 488, T23. =The intervenors'make much of this finding..But our judgment is that we must-take Dow's present intention as controlling, so long asithere has been. sufficient-~ probing to determine what that intention

.-truly is.-

16/

Although the 'intervenors would eliminate that demand by l

having Dow construct;its own. fossil fueled generating facility,1we are'not told:of any environmental advantages that-would accrue from Dow's following that course (see

.pp. 10-12, supra).

n

~

' t b'e : sure, financial an'd other - considerations might result in'Dcw's being unwilling to enter into a similar arrangement E

~

if'the choice were~before it toda7 But that is true of many contracts viewed in the perspective hindsight affords, in

' Whether or not it is /tcw's best financial interests to honor its contract is not for us but for D,ow to determine.

And,_to repeat,. extensive probing on this point at the suspension hearing yielded convincing evidence that Dow's 47/

present intention is to adhere to the contract's terms.~~

4.

-The ACRS Letter.

This topic would ordinarily be thought of as raising safety, rather than -environmental, concerns.

But the inter-venors perceive environmental overtones: they. point out that if the " unresolved safety problems" prove sufficiently intrac-table, other methods of meeting demand will become more 1

(

desirable than a nuclear plant.

In other words, the poten-tial additional. financial cost involved in resolving those 4

47/

Thus, the situation here is unlike that presented in -

Seabrook, where two participants in the project had-announced they ' intended to sell their interests in the facility and there had been no investigation into q

whether they nonetheless intended to honor their l

commitment to.sm port the project financially until purchasers _were round.

See Public Service Company of New Hampshire (Seabrook Units 1 and 2), ALAB-422, I

6 NRC 33, 80 (majority opinion), 110-11 (dissenting

~

opinion): (1977).. Thus, even before the majority's decision'was upheld;(CLI-78-1, 7 NRC January 6,

1978,' slip opinion, pp. 31-32), nothini in'the Seabrook dissent would aid the intervenors here.

j

. ~

c.

~

+}

L

~

~

c e y s.

,.._u.y n.;

q j..

'f

--n w._

A 23 -

problems;uthey say,1should be taken-intoTaccount in considerinc-whether. the plant -is sjustified..

y 4

4 This1 point'is.not-entirely devoid ofLmerit.

But= absent an environmentally-preferable ~ alternative, it overemphasizes-the economic ~ cost'of'the nuclear.' facility.

As we explained.

earlier,INEPA' requires us to look for environmentally-preferable alternatives, not cheaper ones.

Put another way, once it has t '

been.shown that'the power to be produced by a plant is needed and that.no environmentally-preferable way' exists of obtaining it, the acceptability of.the " cost" of the plant in dollars is a. question for the. utility and the state regulatory agencies, f

the true experts.in this area.

j-

~ This principle' must be applied here.

When the first

~

environmental. analysis was done, the plant's cost was pro-

^4tV

?

~

jected at $554.million;- the latest estimate is that-it will i

-Such a drastic increase might be expected

'costo$1.67 billion.

]

to tip the cost-benefit balance against-the; plant, but this is not the case.

'-For, as-we have said before, genuinely needed

~

4 9/ '

electricity can-be viewedzas "pricele s s "- -- cr, at least, a

of increasing <value in proportion to the cost of building the x

i, i -

_4g - Final. Environmental Statement (March.1972), p. XI-6.

c

. 49/

-~ -Vermont Yankee-Nuclear. Power Corporation (Vermont Yankee Station), ALAB-179, 7 AEC 159, 173 '(1974).

v, 3

c.

+

.1 f

q+

%. e'

--r-W

--w y-r y

=d

.q-

- esi rw,s

• M

,e

-+.-y-4

- = + - - - -

ga.

re

=y-*

y

=*t

- --* v v '

~

,m

~..

x

- e plants.and providmg the fuel to produce it.

Thus, an increase 3

in~: monetary costs may well not alter the plant's cost-benefit

- balance at all, for the benefit side will increase correspond-ingly.

In::short, once_it-has been determined that a generating

' facility is needed to meet real demand, that no environmentally preferable type of facility or site exists,.and that all cosh-Leneficial environmentally-protective auxiliary equipment has been employed', the final cost-benefit balance will almost-always-favor the. plant, simply because the' benefit of riaeting real demand is enormous ~0 /

5

-- and the adverse consequences of not meeting that demand are serious.51/

j i

The environmental cvertones of the issues referred to

~

l j'

-in the ACRS-letter are therefore not of great importance here.

t We-stress, however, that the safety aspects may well'be.

As a

far as we can tell, the Board below has been pursuing the

'52 /

right course in that' regard. -

Nonetheless, it should find l

l f

l-

. m/

Id..at l'75-76.

-g/..See Nine Mile Point, suora, 1.NRC at 364, fn. 57.

. g/

At one point - (January 28,~1977), that Board wrote to the 3

ACRS indicating that-the supplemental report from that body-had not alleviated all its concerns.

We assume

-that,.although its decision did not refer to that letter, the Board ~will not without explanation drop the concerns it.had.

'~

~

h Fg i

T-T

(

p

r. :

^

m.- _

L ~

c

=

4g

~

_m z.

' N.:

h t

L 25 l.

'5 ourf recent' River Bend -decision 3 /' -- rendered after it.ccmpleted the' suspension' hearings and' issued i : decision -- instructive

'as to what furtherEs.teps are-prerequisite tb a final' decision-

'onLwhether, and on what' conditions,.the applicant is entitled to retain the Midland construction permits.

/

54

-Q/

Gulf States Utilities Company '(River Bend Units 1 and 2),_ALAB-444, 6 NRC 760 (1977).

- 54 /.We reject outright any suggestion by. the parties that once ' the ACRS identifies the " unresolved safety issues" it had in mind, no'more need be-done at the. hearing.

Regardless o.f-how they might think they can parse'.the court's opinion,. there.must be at least an explanation of why -- if ' this 'is the case -- each safety problem is well enough in hand for this plant so that construc-tion should be1 allowed-to continue.- See River Bond, suprar compare Applicant's Brie!E, p. 48.

(It.is, of

~

course, no answer that the problem is " generic."

That a safety problem is common to.many reactors furnishes

)

no reason-to' treat it' differently than if it we're peculiarcto'one.).Of course, the intervenors are

. entitled.to question any such explanations, as they

-would have been able to at.the original hearings.

x t

a.

g

.~

p w

26 -

D.

Other-Ecuitable' Considerations.

As-the Licensing Board recognized, a number of other equitable considerations come into play in suspension decisions.55/ What is involved is a " traditional balancing of equities"' coupled with consideration'of whether our deci-sion is likely to result in any " prejudice to further deci-

-sions."E5!

In most respects,_there is no need to repeat-what the Board below said about the individual factors it considered.52[- But two points do deserve further discussion.

55/ 6 NRC at 484-85.

3g/ SeeRfn. 14, supra, and 6 NRC at 484.

We have stressed both in this proceeding and in other cases that the

" prejudice" factor can-be-an extremely important one.

ALAB-395', 5'NRC_772, 779", 786 fn. 44 (1977) ; Public

.4

-Service Company of Indiana (Marble Hill Units 1 and 2),

6 NRC 630, 634 (1977); Florida Power & Licht Company (St. Lucie Unit 2), ALAB-404,. 5 NRC 1185,1188-89 (1977).

52/ In~ light.of the balance of its opinion, we do have diffi-culty with the Board's concluding summary to the effect that "there are substantial equities-favoring * * *

. suspension."- 6 NRCfat 498, 170.

As the remainder of its summary,fas well as_other portions of its opinion, make clear, all that the Board found in the intervenors' favor was that they raised..their. arguments on the merits in timely fashion and.that the defects in the proceed-ings "were significant enough" to require a remand.

. (Aa we have seen, those defects have paled into insig-

-nificance.).

In the~same vein, the intervenors have

-absolutely no basis for. telling.us that the Board below found for:them.on " virtually every contested issue"

-l

.other than'" sunk costs" (Srief, p. 1).

j a

~

~

27 1.

'Apolicant's Investment in Midland.

Much; controversy has centered on the significance

-of the-considerable time and. money the applicant had invested.

- in the'constructiontof the facility by'the time of the court-ordered remand.

Some $3701million dollars had-been put into the plant by then; cohstruction of'the units was 16% complete.

Thel Licensing Board believed this to be of overwhelming

- significance.

The intervenors argue, on'the other hand, that the investment must be ignored.

Under this agency's rules (10 C.F.R.

f2.764), a decision authorizing the issuance of a construction permit is effective 58 when issued, unless stayed.- /

In this case, neither we nor

. the ccart of appeals were asked for a stay pending review.59/

--58/J 10L C.F.R. 52.788 (as added by 42 F.R. 22128, May 2,'-1977, effective June 1,-1977).

The

~

substantive stay provision appeared only recently in the regulations.

It merely codifies long--

-standing agency stay practice which parallels s'

that of the courts.

See, e.g.,

Northern Indiana

~

Public Service Company' (BarlTy Nuclaar-1), ALAB-192, 7 AEC 420 and cases there cited- (1974) ; Florida Power & Light Company (St. Lucie Unit 2), ALAB-415, 5 NRC-1435, 1436 (1977).

- 59/ '

See App. Bd. Tr. 30-31; 54-56.

At argument, we were i

initially under the impression that stays had been-reques ced.(but denied) - pending appeal board and judicial J

review of the initial licensing decision; as it turns iout,.no stay was ev'ar requested ~.

R

(

f 4

~

t.

m

- 28 That.raview took longer than usual.$S/

Thus, when the E

court's remand order came down, the applicant had made sub-stantial progress in: constructing the facility.

No rule of law or equity of which we are aware forbids taking_that fact into' account.51[.Up to the point of remand,.

the applicant had invested in the Midland project under the color of construction permits which', though subject to 60/ See pp.

1-2~,

supra.

61/ Indeed, there are judicial decisions which recognize that, in deciding whether to halt a project pending further NEPA review, it is permissible to consider the amount of construction already undertaken.

Conservation Society of Southern Vermont v. Secretary of Transporta-tion, 508 F.2d 927, 936-37 (2d Cir. 1974), > vacated on other_ grounds and remanded, 423 U.S.

809- (1975); Sierra Club v. Morton,-514 F.2d 856, 878 fn. 29 (D.C. Cir.

j 1975), reversed on other grounds sub nom.

Klence v.

Sierra Club, 427 U.S.

390 (1976) ; Chick v. ' Hills, 528 j

F.2d 445, 448 (1st Cir. 1976)..Moreover, a line of decisions recognizes that additional investment' prior to a final decision can tilt the balance against alter-natives or against environmental concerns.

Calvert Cliffs'~ Coordinating Committee v. Atomic Energy Commission,

-l 449.F.2d.1109, 1128 (D.C. Cir. 1971); Coalition for Safe Nuclear Power v. Atomic Energy Commission, 463 F.2d 954, 956-(D.C. Cir. 197 2) ; Union of Concerned Scientists v.

Atomic ~ Energy Commission, 499 F.2d 1069, 1084 fn. 37 (D.C.

Cir. 1974); see ALAB-395, supra, 5 NRC at 779.

As_we explained on another occasion, implicit in these deci-H sions is theDprinciple that if no stay of construction is granted pending a final ruling, the investment made can legitimately be:taken into account in' determining twhether to stop the1 project at.later stages.

Public LService - Company of ' New Hampshire (Seabrook Units 1 and

2), ALAB-3 4 9, 4 NRC 23 5, 261_ (1976).

p

+

h a

.i c

,A 29 -

further review,_ were fully in effect.6_2_/

Given that back-I ground, the length of. time it takes to build a major' nuclear power _ plant, and the utility's. belief that it would need Midland's output to satisfy power demands including its contractual commitment to Dow, it ha'd little.

choice other than to proceed with construction _ while the reviewing tribunals deliberated.

Put another way,_the' utility can hardly be faulted for exercising its rights under presumptively valid construction permits which the opposing parties had not even asked be stayed pendente lite.

I

.Nor is there any other reason to say the utility entere the arena sith unclean hands.

The defects that the

}

court found involved neither a failure of the applicant to' disclose relevant information nor any other censurable

~

i 62 / The same 'cannot-be said of the investment made since then.

By'way of information, in a one-year period 1 roughly coinciding with the period between the issuance of the court's mandate and the Licensing Board's deci-

-sion, the amount expended on_ Midland went from $381.6 million (September 30, 1976) to $593.4'million (September 30, 1977). -This investment is projected to reach S732.1.million by~ March 31', 1978 -- putting.

= construction at 42.5% complete.'(These figures-are from the NoverberLil, 1977-Keeley affidavit, furnished at' our-request 1 prior ito oral argument.)

Y

• /4 F

f e

y r S

e++-s

-r we t

y

- ?

i.';

i W

t. r

/

conduct on its'part -

thus there is no warrant fer us to 5

c

'say that the NEPA revi'ew was lacking in integrity $ ! or

'that the applicant had proceeded with the project ip bad

' faith.55/ Nothing that occurred prior to the remand

. suggests that we ought to ignore the applicant's invast-ment in order either to prevent it from taking unfair-i advantage or to discourage future applicants from engaging in similar conduct.55/

I 63/ See Public Service Company-of New Hamoshire (Seabrook Units: 1 and 1!), CLI-77-8, 5 NRC 503, 532-33 (1977);

Florida Power-& Light Company (S t. Lucie. Unit 2),

1 ALAB-335, 3 NRC 830, 84 0. (ma3nrity-opinion), 844-46 (dissenting.cpinion) (1976), reversed, Hodder v. NRC

(

l

. D.C.'Cir. No. 76-1709, October 121,1976) (unpublished).

L 64/LAlthough the ' allegedly improper conduct during the course of.the= suspension hearing (see p. 43, fn. 87, j

infra) -must be analyzed further. for other purposes, it is immaterial insofar as our treatment of the investment made prior toithe court's remand is con-

+

.cerned.

-In this qame connection, we cannot agree with the intervenorsE(October.18th:"Further. Statement

• 1

- p._4) that it was in any way deserving of condemnation i

.for the applicant to have'successfully pressed ~upon

this. agency in the_initialJ11consing proceeding legal 1

' arguments which the court ofnappeals later determined to be lackingjin merit.

Insofar as the integrity _of

~

zthe proceedings or_the good faith ~of the parties is.

concerned, there is no parallel between zealous advocacy

~

Minesupport of an arguableLlegal position and, e.g.,

.i

^

.the withholding of' relevant' factual-information.

We-note: chat'in'the~1atter regard.we: fully expect _both 0

cliente and : lawyers to adhere to the highest: standards.

See,; egg.. Vermont Yankee Nuclear' Power Corp. (Vermont.

Yankee Station), ALAB-13 9, 6 AEC 52 0, 533 ( 1973)..

l l15/ See Seabrook,' CLI-77-6, supra,.5 NRC'at-533.

1 Y~

t i

n e

n,,

w ar s w-v v s

4 y

-nr

,7

,----,m,-eg

~,,, -

g+

we +

n

n.

4 We recognize that in the final analysis an applicant 5

invests in a nuclear project at its own risk.66/

^

What

- this means is that for any number of reasons a construction' permit may.be revoked, or an operating license withheld, and the investment lost.67/

But it does not mean that when it comes to comparing a proposed project with possible alternatives to it, no consideration may be given to the amount of progress made in circumstances where the agency and the applicant have proceeded in good faith.68/

1 The only. purpose such a rule would serve would be to discourage applicants'from beginning work on a project until all M

66/ This has been the rule.from the beginning.

Power

-~

1 Reactor Company v. Electricians, 367 U.S.

396, 414-15 (1961) ; Coalition for Safe Nuclear Power, suora, 463' F.2d:at'956, fn. 1; Union of Concerned Scientists v.

Atomic Energy Commission, supra, 499 F.2d at 1084, fn' 37; Aeschliman v. AEC, supra - (October 27, 1977 order).

67,/ This may result, for example, from safety-related defects or from the belate'd discovery of serious sub-

~

stantive anyt:onmental concerns.

Or it might be revealed thr. the envircnmental analysis was not performed in good faith.

'68/ Of-course, if the intervenors can'make good on their

~~

premise to establish that Midland is simply not needed

-(rather than that another facility should be substi-tuted for it), - the cost of abandoning it will not be considered in deciding whether to revoke the permits

'for one'or both units.- Union of Concerned Scientists

v. Atomic Energy ~ Commission, supra, 499 F.2d at 1084, fn. 37;_ Aeschliman, supra, 547 F.2d.at 6??, fn. 20.

e-r

.-ws-er-mw y

c

.s

., ~

administrative and judicial review was exhausted.

We do.

not perceive any reason why that -should be the general rule.

It certainly is not,the policy the commission has instructed us to implement.

To repeat, its rules, like

~

those of the courts, provide for the granting of stays in appropriate cases.61/

But where a stay is not ' justified by' the particular circumstances, no legitimate purpose is served by delaying the start of construction for several years.

2.

Potential for Prejudicing Further Decisions We have already held that the issues being liti-gated on remand do not appear to be of large practical significance.

And we have observed (p. 9, suora) that

.e there is no suggestion -- either in the evidence or by way of argument -- that there is an environmentally prefer-able alternative to Midland.2S/- Viewing these circumstances 69/

See fns. 56, 58 and 61, suora.

70/. The alternative suggested is the substitution for most

~~

of Midland's proposed capacity of a utility-owned coal

plant'and'Dow's own plant for production of'the steam and electricity.it'needs.

But there is no evidence even. remotely suggesting'that this approach is environ-mentally superior.

Early on, this agency looked for better alternatives.and found none (see 5 AEC at 226-28).

Consequently, that holding, left undisturbed, still-

. guides us.

1

r S-

- against the background.of a nuclear plant that was well 3

on its_way to' completion at the time of the remand, we are unable to perceive how permitting construction to proceed could prejudice later decisions.

In other cases, a need might arise to suspend construction at an early-stage to preserve potential options that cotid prove preferable.21!

But here no such options are in sight.

And should one

-belatedly be discovered, given the minimal adverse environ-mental impacts attributable to the Midland facility, th'e environmental' advantages of the alternative would have to-be substantial to~ justify adopting it as a substitute for I

Midland.in the circumstances presented.

)

. q 1

71,/

Public Service Comoany of New Hampshire (Seabrook 2

Units 1 and 2), ALAB-349, 4 NRC 235, 258-62 (1976).

We have granted suspension of construction when we thought it appropriate to do so.'

Northern Indiana 1

Public Service Company (Bailly Nuclear-1), ALAB-192, 7 AEC 420 (1974) ; Cleveland Electric Illuminating Company (Perry Units 1 and 2), unpublished order of November 6, 1975,.. explained in ALAB-298, 2 NRC 730 (1975); Seabrook, ALAB-349, supra.(suspending on fuel cycle grounds when that matter was still poten-tially significant), reversed, CLI-76-17,.4 NRC 451 (1976); and ALAB-366, 5 NRC 39 (1977), affirmed,-

CLI-77-8, 5.NRC.503 (1977).

.~

_.34 -

Th'e short of it is that there~are simply no ecuities-I

~

favoring' suspension.

The record.in this proceeding, measured aga'nst governing legal principles, compels denial i

of::intervenors requests for. relief.

4 k

O

.h-4

.w, b

I O

J

's t

A 2

f S.

v N

g

/

m

....~.;

- E.

Additional Observations one further topic deserves special attention at this juncture.-

The intervenors insist that this agency must listen to their_ complaint that Dow intends to employ steam and electricity from the Midland project to make certain products which the intervenars believe are not in th'e public interest.

In this connection, they claim that the Board belcw erred in deciding the suspension question without-inquiring. into this matter, i.e., without examining the societal ~ value of the en'd uses to which the applicant's in-dustrial and residential customers will put the plant's output.

And they have indicated.that they fully intend to pursue this 73/

. point at the hearing on the merits.--

At an earlier stage of this proceeding, as well as s

in at least one other case, we have held that this "end-use" 74/

argument has no place in our proceedings.--

Ordinarily we would therefore simply cite our earlier decisions, particularly in view ' of. the. intervenors ' failure on their original appeal

.to the courts to press their claim that our holding was 72/ -See, e.g., Brief'in Support' of Exceptions, p. 34.

73/ ~ App. Bd. Tr.165-67; Additional Brief (post-argument), p.14.

74/

ALAB-123,-6 AEC 331', 351-52 (1973); Long Island Lighting

~~

Companv- (Shoreham Station), ALA3-156, 6 AEC 631,-852-54 (1973).

a, n.

36 -

75/-

wro ag.-

Te cannot. be certain, ' hcuever, that were the case 3

' ~

to cett before it: again the-court of appeals would deem the point to have been waived (see fn.-75, supra). Because the intervenors have made it clear they will pursue the matter both at_ the hearing _ on P.he merits and in the courts, lengthier exposition of our views will both avoid wasted time and effort at the Licensing Board-level and facilitate Commission and judicial review of our decision.

.a.

We can perhaps-best explain our reasoning by discussing firstIthe class of -Dow products that has prompted the~intervenors' particular concern, namely, " chlorinated hydrocarbons."lE/ We assume that they refer to pesticide products 22[andthat'th'eybelievoathoughtfulNEPAanalysis would find those products environmentally harmful (with the

_s 1E/

The court.of appealsEsaid.in its opinion that the end-

-use argument "is not pressed on appeal."

547 F.2d at 626, fn. 8.

This is somewhat differen?.~from the inter-venors' recollection that the court said it " assumed

[they]-waived the argument because [they] did not press Lit in (their] ' oral argument." -App. Bd. Tr. 165. They new say that, " contrary to the Court of Appeals' footnote,"

-they-have not abandoned the argument-(Additional Brief,

p. 14).

7(ys.See, e.a.,-547 F.2d at 626, fn. 8; App. Bd. Tr. 165.

77/ ' See their February 6, 1972 Statement'of Environmental Contentions,-134 (referring also to'the pesticide chemical. known as. 2,4,5-T).

s

)

L

37 -

.resu., so their argument' goes. that any electricity or steam te be used for their production should not be counted on the

'need for power" side of the NEPA cost-benefit balance).

We cannot agree with the intervenors on the need or warrant fer'us te conduct the analysis they want.

The sale of pesticide chemicals is regulated by the Environmental Pr7tection Agency under the Federal Insecticide, Fungicide

/

1 and Rodenticide Act (FIFRA).LL To obtain federalLapproval,-

i a pesticide must be - found by the EPA Administrator to confer.

benefits in excess of its risks.

In other words, that official must determine whether, considering all aspects of the product's potential for harm, it is in the public interest that it be marketed.

Dow may produce pesticides for domestic us 80 /

e--

In short, A

only if they have already received approval under a compre-hensive federal regulatory scheme.- Insofar as pesticides are c

concerned, then, the 'inte'rvenors are asking es to inquire

-into the correctness of EPA decisions -- made af ter~ full 3/-

7. U.S.C. :135 et, sec.

/

~

11 ; Environmental Defense Fund v. Ruckelshaus, 439 F.2d 584, 594 (D.C. - Cir. - 1971) - (under FIFRA prior.to its 1972 amendment) ;; 7 U.S.C. 136a (c) (5), 136 (bb) (under

.FIFRA: as amended by the Federal Environmental Pesticide Control Act of 1972).

'12/ ' ; Exports are' essentially unregulatedn (7 U.S.C.

136 (o) ),

on the theory that the foreign country in which the product will be used -should determine whether its

particular needs -- e.g.,~ control ofla disease-bearing pest not'present' in. this _ country -- are such that on

~

4

~ balanceithe product is.beneficia11-there.

~

a 4

e,-,.

==

i----,r p -

p

81/

adjudicatory hearings in contested cares ~ -- that it is

.in the public interest to manufacture.particular products.

But Congress has -charged the ' Administrator, not us, with the direct and primary responsibility for making those decisions, and has made his decisions subject to judicial 82/-

review.--

Therefore,. once those decisions have been made with' respect to Dow's products and have survived direct attack, they must be taken as embodying a sound: federal judgment-that a met societal benefit will flow from Dow's pesticide manufacturing activity.

We see nothing in NEPA which gives us a warrant to second-guess that judgment.

81/

7 U.S.C. 136d(d).

31,/

7 U.S.C. 136d(e).

_s 83/

The cost-benefit-test we would apply under NEPA is essentially no different from the test the Administrator applies under FIFRA.

See 7 U.S.C.

136a (c) (5), 136 (bb).

Thus, the situation before us is. not similar to that which was presented in Calvert Cliffs' coordinating Committee v. AEC,:449-F.2d 1109, 1124-27 (D.C. Cir.

1971), where the test applied by another agency in administering the then-effective provisions of the

-federal water pollution laws. differed significantly from our. charge under NEPA.

Of course, Calvert Cliffs has since been legislatively overruled insofar as our water-related duties are. concerned.

Section 511(c) (2)~,

Federal-Water Pollution Control Act,.33 U.S.C. 1371(a) (2)..

LIn this connection, the Commission has_just recently affirmed our decision that-it is now inappropria.te for

.us-toireview-EPA's determinations-regarding.acuatic

' impacts.. Public ServiJe Company of New Hampshire (Seabrook ~ Units 1 and 2), CLI-73-1, 7 NRC (January 6,

~ 1978) -(slip opinion pp. 33-42), affirming XD.B-422, 6 NRC : 3 3, 69-72 (1977).

See also ALAB-366, 5 NRC 39, 48-52.(1977).

3

..n~

f sa

.sm. w a

e l

' Practical. considerations reinforce our decisien that

~

we have no business intruding into another agency's-regu-I latory realm.- A pesticide registration proceeding involving

~

l only-one product or. family of products can involve extra-ordinarily long hearings because so much' highly technical 84/

evidence must be adduced.--

Under the intervenors' L

proposal, we-would have to duplicate EPA's effort for not just one but many such products.

Even so, we would be considering only a relatively few of the-products made by only one"of many' industrial users of the nuclear plant's output.

The' sheer magnitude of the task the intervenors would assign this agency -- threatening to increase many' times

(

the already gargantuan size of the records that are being l

_ compiled -- cautions against our undertaking it.

J We are not implying that boards'can shrink frem inquiry

~]

a into matters that are directly relevant to licensing decisiens simply because the inquiry will be a tedicas one.

But_that is

~

Jg/

See, e.g.,

Environmental Defense Fund v. Environmental PrStection-Agency, 489 F.2d 1247, 1251 fn. 24 (D.C.

CIi.1973) (DDT hearing:

seven months, 125 witnesses,

-365 exhibits, over 9000 pages of transcript) ; Environ-

)

mental Defense Fund v. Environmental Protection-Agency, l~

510 F.2d 1292, 1297, 1304,.1306 (D.C. Cir. 1975):(aldrin /

dieldrin hearing:

twelve months into cancellation hearing, i

a fourteen-day' expedited suspension hearing was held,

_ resulting in'a'4000 page transcript plus the incorporation

- of 11000 pages of transcript'and 350 exhibits from.the cancellation hearing, at.which one party had c ; ready i

called 125. witnesses.):

g L

- 4 j

t

~

,1.,

-J.

.L

-m

. m m,

not what is involved here.- The intervenors would raise frank'ly. collateral-matters-and take the proceeding on'a lengthy. detour.for'no purpose.

b..

To be.sure, not all products are, like pest'icides,

. subject to pervasive federal regulation; those that are not cann"t likewise be conclusively presumeE beneficial to society. - And the fact-that ' there is a demand for these products is not determinative, because the forces of the marketplace are not infallible judges of the public interest..

But practical considerations similar to those just mentioned in connection with pesticides preclude us from entertaining l

the "end-use" argument for other products as well.

After all, NEPA does 'not require us to do more that what is reasonable; and it wculd be unreasonable even to attempt to ascertain i

i whether each Dow product serves a useful or beneficial purpose,

]

J much less to pursue that inquiry into the myriad other uses to which the applicant's residential, commercial and industrial

~

customers will.put the electricity they consume.

LIn the first place, such an: inquiry would be virtually

~interminabi And assumin'g our boards could muster the time,

' energy:and resources to fill'out an~ environmental report card covering ea,ch use, the grades they assigned would te. of no practica1'importance.

The Commission cannot ban the offending uses.

Moreover, our: expertise would in all likelihood be 85/ '

Seelfn. 184, supra, with respect to one family of chemicals alone.

w 6

t

=

e e.e..

A s~'

41 -

- doubted,.and our grading system ignored -

and not without some~ justification.6.5./

Our judgments, lacking any - force, would serve only: to let us eliminate from the applicant's projected need-for-power curve so much of the steam and

~

electricity-that would fuel.the " undesirable" uses.

Using that altered curve for NEPA purposes, we might determine l

not to license' a proposed facility (or agree only to license zi smaller facility' than the one. proposed).

But-for two reasons ~

this would~not achieve the result sought, i e.,. the elimination of the uses found wanting.

First, the applicant could still use its own demand curve for its own purposes -- neither-we nor any other federal' agency could prevent it from building coal-fired plants to provide its customers with all the electricity they craved (thus. fulfilling the obligation most s

~

States place upon public utilities). Second, even if the applicant.

followed our' lead, nothing would -insure that, if its customers' l

full demands were not met, they would use the electricity available. to ' them only for tie uses we have found most bene-

- ficial'.,For example, it does not malign Dow to suggest that, faced. with a. power. shortage, it -

like other industrial

~

86/- _ Decisions concerning the legitimacy of particular uses

~~

- of electricity would be much more suitably mad'e, it seems,.by'a legislative body-than by aul agency with our regulatory. mission.-

t e

w e s

-+---.e

.y

+.

+

^,-a

~

=

,s

_ 42 -

ccncerns -- might choose to-produce 1 the most profitable items, : rather1than those we happen ' to hold in-highest regard.

.Moreover,_'as far-as residential customers are concerned, any power shortage resulting from-not meeting full demand would

~

visit haEdship indiscriminately upon all, cutting service not just'to those cuilty of putting electricity.to ill use (as we might have defined it) but also to those who had' adopted our~ decision as a guide.

In shor't, the~intervenors' suggestion that the Licensing' Board look into the end uses. of the electricity and steam to be produced ~by the -Midland facility is unreasonable,- imprac-tical and unwarranted..The Licensing Board is not required by NEPA to' spend vast amounts of time and energy in such a.

fruitless pursuit.

A 1

1 1

We conclude that-the Board below was. correct in declining j

to order suspension of construction.

In light of the absence of any. potential environmentally preferable' alternatives, the violations 1being considered on.the. merits simply do not i

~

appear to be of-sufficient moment to warrant a halt of further 4

9

'l l

1 I

,~ _,,

n,,

y t' V

,N n

- 43 s.-

/

3 construct' ion pending a decision on Lthe merit,s 82 Affirmed.

.It is so ORDERED.

FOR THE ATOMIC SAFETY AND LICENSING 1 APPEAL BOARD E

& p?tbt_a

/

Lu r.argaret E.

Du.Flo pSecretary.to the

' Appeal Board

--'87/

We'have eschewed any comment on the significance of the events which11ed.the Board'beldw to include in paragraphs' 9-11' of its decision - (6 Inu: at 485-86, as amended by order _of November.4, 1977). comments re-

~

lating to.an alleged, albeit unsuccessful, attempt by the applicant to prevent full disclosure of'the facts-relating to Dow's intentions with regard.to its contract.. That matter was not put to. rest by the November 4th order.

Nor was-it dealt with

~inde'ed it.was;specifically excluded from_ consideration

'l

-- in another order the Board. issued that same day,.

referring certain attorney misconduct charges to'a special licensing' board pursuant to.10 C.F.R.

32. 713 (c).

.That board has sinceLbeen told by the Commission to attempt to(settle those charges, failine which it will

.be dissolved"(January 30,_1979 letter from the Chairman of the; commission'to the_ Chairman of the-Special Licensing

the special board _do not apply to the' entirely different j]

Board).

The reasons t6e Commission gave for dissolving type of charges involved here.-_

And'it is important that they be~ fully aired'and. resolved.

Consequently, we: fully expect both that matter and _ the' merits of the ACKS's

" unresolved safety issues" to be explored further at.

future, hearings beforecthe Licensing Board.

This must be.done. whether or not the parties are therselves.other-wise' interested in-pursuing these matters.

1

'q I

e 1

y

,-.--,e,

,e a,

,_-ge, y

,,.