ML19338C016

Brief in Response to ASLB 760921 Order Directing Parties to File Briefs by 760929 Re CP Suspension Issue.Discusses Facts to Be Addressed & Procedural Context of Hearing.Rejects Suspension.Proposed Schedule & Certificate of Svc Encl

ML19338C016
Person / Time
Site:	Midland
Issue date:	09/29/1976
From:	Reis H CONSUMERS ENERGY CO. (FORMERLY CONSUMERS POWER CO.), LOWENSTEIN, NEWMAN, REIS, AXELRAD & TOLL
To:
References
NUDOCS 8007310581
Download: ML19338C016 (29)

Text

'O. .4 y s e I e .

I September 29,.1976 L

UNITED STATES OF AMERICA' NUCLEAR REGULATORY COMMISSION In the Matter of- )

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CONSUMERS POWER COMPANY .

Docket Nos.

(Midland Plant, Units 1 and 2) )

BRIEF.OF CONSUMERS POWER. COMPANY IN RESPONSE TO BOARD ORDER OF SEPTEMBER 21, 1976 This-brief is submitted on behalf of Consumers Power. Company (" Consumers P'Jwer" or " Licensee") in re-sponse'to the Board's memorandum and order of September 21, 1976, directing the parties to file briefs by' September 29, 1976, with-' respect to the question whether the construc-tion permits'for'the Midland Nuclear Power-Plant, Units 1 and 2, should beLcont'inued, modified _or suspended pending completion.ofLreopened hearings which would consider all of'the: issues remanded by the Court of Appeals in Aeschliman

.v.. Nuclearf Regulatory Commission (Nos. 73-1776 and 73-1867, U.S.. Court-of. Appeals'for-the' District-of Columbia Circuit,

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declded July f21,: 1976) .

In-accordance.with the previous order of this

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' Board of AugustD18, 1976,- the ..rties have' earlier filed

. briefs directed at the same question'but limited to whether 18(00731chfib(/sf -

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the. permits'"should be continued, modified, or suspended until an interim fuel' cycle rule has been made-effective."

That order had'been issued in effectuation of'the Commission's General Statement-of Policy.-- Environmental Effects of the Uranium Fuel-Cycle (41-F.R. 34,707, August 16,-1976); "GSP"),

which stated that no issues involved in the-Aeschliman remand should be considered until the Midland decision had become

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final. . (41 F .R. at 34, 709 n.2.). Accordingly, the briefs of both the Licensee and-the NRC staff confined themselves to the

. question of. continuation, modification, or suspension until an interim fuel cycle rule has been made effective, and viewed

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these alternatives in light of the fuel cycle issue alone.

However, the Intervenors' memorandum (p. 21) was based upon

+ ..e premise that this Board'must consider the issue of

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suspension _in light of all of the remanded issues.

Thereafter, in a memorandum and order issued on September 14, 1976, the Commission _ denied both Consumers Power

' Company's motion to recall the order reconstituting this Board

• /. The Commission also issued an order on August 16, 1976, reconstituting this Board "for the limited purpose of considering whether the construction dermits for that facilityLshould be continued, modified, or suspended until an interim fuel cycle-rule has been made effective."

-**/' In its1brief (p. ~4) , the Staff stated that'following the issuance offthe mandate, it would be prepared to brief 1the. question whether--the Midaand-construction permits should be' suspended pending completion of remand pro-ceedings on-the other issues.

• • • / SeeLalso letter,of September 14, 1976, from the Inter-Lvenors' attorney to Board Chairman Head.

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z and Intervenors' : motion' to suspend - the construction- permits forthwith. -In: view of the issuance of the Court's: mandate

- in Aeschliman on : September 3, ' the ' Commission ~ did, however, grant the Intervenors' request. to allow this Board toJconsider =

all~of'the remanded. issues. On the same'date, the Commission 4

also issued a separate direction-to this~ Board to' consider.

the remanded issues and "to call for briefs from the parties

-to define all required steps, and to undertake any necessary-proceedings."-

4 In its subsequent _ September 21 memorandum and order,

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this: Board ,notedL that the Commission's memorandum and order of September 14,.1976, stated that the question of whether the-

-permits should be continued, modified or suspended is not appropriate-for summary disposition. The Board interpreted this to require a-hearing on1the question and, by separa~te

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notice.and order, the Board scheduled such a hearing for 1

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October 6. The1 Board also requested that the briefs to be filed on September 29 include the parties' best

information on timing .for the hearing on the merits of- the

. reopened ~ proceeding,1taking_into account the time needed for

- discovery and the time _neede~d to~ prepare cases on the merits.

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In thisLconnection the' Board' stated-it required this informa-

. tion in order- to obtain- an estimate of the time that might i

Ebe-involved'if the construction permits should be suspended. l

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...The Board 'also requested the parties to include in o their

~. briefs lallLinformation.necessary "to defineLall required steps" Xin_.this proceeding..in accordance'.with the Commission memo-randum and order of September.14.-

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. I. The~ Procedural Context of the Suspension Hearing Licensee's. response to the' questions addressed by the Board and discussed-below in this brief may be-

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summarized:briefly.- First,=it.will introduce evidence'at the hearing now scheduled-for October 6 which will demonstrate that the construction permits should not be suspended pending completion of the-reopened hearings considering all of the issues remanded by 'hec Court of Appeals.

Second, the only: issues which the court remanded Land-required the commission to reconsider, and which the Com-mission in turn instructed this Board to consider, are: (1) specific techniques- for: the reduction of demand for power -

(" energy conservation"); (2). the incremental environmental impactiof. waste disposal and fuel' reprocessing; (3) clarifi-

- cation of.the general reference to "other problems" in the ACRS letter;'and (4) changed ~ circumstances ' regardi'.ig Dow's need for' process steam, and the in' tended continued operation

of Dow's fossil-fuel generating facilities. With regard

to energy conservation, we note that in~their memorandum (p. 17) in response.to this Board's order of August 18, 1976, Inter'-

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i venors suggested that the Aeschliman decision. held that "end-use f ~

issues'and alternatives.were not-properly explored in the prior o hearings..'."' -Insofar:as "end-use"-issues (or, as Intervenors' I'

l (contentions were more appropriately described by the Court, L '"end-productLarguments") are' concerned, this interpretation l 'ofithefAeschliman decision is incorrect. The Appeal-Board-L ' earlier : held inithis. proceeding that:

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...the-[ Licensing) BoardLwas not required.

to: analyze the use to whi~ch Consumers' cus -

tomers:mightiput- the power generated by the. --

. Midland-plant to-ascertain whether'that"use

would haveLan , adverse environmental impact. :

F :The Board made a . finding that the ' postulated -

t "demandL is made 'up' of' normal . industrial 1 and

? residential useand that'it need not inquire-intojthe propriety of suchl customary uses V of  :

l electricity. We: agree."'

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ALAB--12'3, 6 AEC 331, -352 (Footnote omitted) . This 1;uling-was

njot rev'ersed inithe'Aeschliman decision.- Rather, after quot-1 ing thenaboveflanguage, the Court-said:-

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"In addition to arguing NEPA required L consid-eration'of. energy conservation alternatives, h the-.intervenors argued that the alleged " bene-

= fits" of dthe - plant .should be discounted by the environmental harm which would be done by .the

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productsLmanufactured from the power. generated.

'In particular, the 'intervenors focused .on cer-tain ' alleged carcinogens produced by the Dow Chemical Co. ,. a large potentialfcustomer of the Midland plant. See', e.g.,LSaginaw Environmental

< Contentions $34, III J.A.fil8.- This 'end pro- ~

! ' duct' ~ argument iis not : pressed on appeal."  :

(Emphasis added.).

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Clearly,- if the Court' considered that the"end product.argu-

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E _ments were'not pressed on appeal by Intervenors, it'did not.

remand?those issues.-

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l' Moreoverh Intervenors attempt to_ revive their

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end p'roductiarguments is-based on confusion ~of issues dealing f

with energyiconser'vation-(i.e.,. specific techniques for the i

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~ reduction'-of. demand forfpower, such as modifications to -rate-

. . structure. and . educational programs :to encourage reduced usage) -

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with-the end-product arguments (which' relate to the desirable Tor 1 undesirable"environm'entaliimpact of' products manufactured

by" customers from :thelelectricity _ generated) . _. Ascwe:have

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shown above, the end product arguments raised by.Intervenors

'have.already b'een disposed of by the Commission; and the Com-mission's actions have not been reversed or remanded'by the

. Court.

Third, in view of'the express statement-in the GSP that.the reprocessing and. waste management issues which'might

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oth'erwise be involved in contested hea' rings should be deferred

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pending completion of the interim rulemaking (41 F.R. at 34,708,-

34,709), no discovery or hearings with respect to those issues are required'either.

Fourth,'while we do not believe the remaining issues which have been remanded are so complex as to require either protracted hearings or protracted discovery procedures, for instant purposes we do assume / that a supplement to.the Final Environmental Statement will be prepared before the hearings on the remanded issues are completed and will be recirculated in accordance with 10 CFR Part 51.- Accordingly, we have pre .

pared a. proposed-schedule relating to hearings-on the remanded issues on that assumption. The proposed schedule also assumes that, for purposes of expedition, discovery will be undertaken f

-*/ The law as to when oa. supplement to an environmental impact' statement must be recirculated is not entirely clear, but can be. interpreted as requiring recircula-tion when a particular subject has not ceen treated in the ' original- document. Appalachian Mountain Club v..Brinegar, 394 F.-Supp. 105 (D .N . H . 19 75) ; Sierra Club v.c.Froehlke, 359 F.-Supp. 1289-(S.D. Tex 1973);

. Natural Resources. Defense Council, Inc. v. Callaway,-

'T8 9 F . .Supp. 1263 (D. Conn. 1974) affd. 524 F. 2d 79

- l(2d: Cir. 19.75);<I-291 Why?'Assc.-v. Burns, 372 F. Supp.

223 (D. : Conn. 1974); but see Environmental Defense Fund v.1Froehlke,.-368 F. Supp.-231 (W . D . Mo . 1973).-

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as eachinew segment'of relevant-information becomes available

e.g., discovery ofcConsumers= Power ~ Company with respect to the Environmental' Report 'is to be- undertaken as. soon- as it files

' the : report, and such_-discovery is to be completed promptly;

.The same wouldfapplyftoLany discovery of the parties that y might 'be appropriate' as fa result of. the issuance 'of the clari-i E .fied ACRS letter. In addition, we believe that a hearing on ACRS' issues,.if required, could be-held before the supple -

mental FESLis' prepared.' If-the proposed schedule is adopted,

an initial decision on'the remanded issues-could be issued E

-some time after the-mid'dle of April, i.e., within a period of approximately seven to-eight months. In~ Licensee's view,

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the proposed: schedule /encampasses all of the steps required

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to complete the hearings. We suggest that it be considered and adopted at the October 6 hearing. /

II. The Factors to-be Addressed'At'the Suspension ~ Hearing, 2

L As noted abov'e,~this Board has concluded that the disposition ~of the question _of modification, suspension-

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or continuation of the construction permits requires a' hear-ing - at whish' it will: receive evidence concebning the Efactors -

7 set out in1the GSPJ . Consequently,-we believe it-appropriate.

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hereafter;in this brief.'o t summarize briefly the nature of~

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. Subsequent'tor preparation'ofothis proposed' schedule, which;we"have1 attached 1as-Appendix A-to this Brief,

.Intervenors. filed their Motion for a continuance of itheloctober 6. hearing.;~We have, therefore, prepared-JandLattached as: Appendix B-;anf alternate proposed . sche-

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-should this

BoardLgrant;one.

dule twhich1 factors in such' JThis a continuance,i alternate' proposed schedule .also -

Tistdesigned to allow for an-initialidecisionJto11ssue?

, -somertime-after the middle.of~ April.

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. lthe, evidence which ' Licensee. presentlyT intiends- to. provide' at the

. hearing.toidehon' strate'that the permits'should remain in' force.

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. 1. withou~t modification;- We. address' tho'se factors- - seriatim Lhere,.Jwith' reference to the rcmanded' issues where appropriate. i I Recognizing-that. the ' length ;of aSy putiative' suspension period

- involves ' substantial uncertainties, . and .in an' attempti to - pro-

" vide: the : Board with a; perspective on the scope of the effects-of sus..;ension, we'have studied three suspension periods: '(1)

September;lithrough-December31, 197.6-- this period coincides with the: estimated period set'forth in the GSP for the Commis-sion to develop. an interim fuel cycle rule; ~ (2) . September 1, L. .

( 1976 through August 31,/1977.- the GSP estimate'of a date for i

issuance of.a final' fuel cycle rule; and-(3).-November 1, 1976 ,

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.through April-30,'1977_- the time between the-approximate-date.

of decision.in'the.' suspension hearing andithe approximate date

.of decision onsthe~ merits of the' remanded issues,. assuming.

eitlier'ofIthe Licensee's attached proposed schedules is ad' opted.

A 1.. .No significant adverse environmental- impacts will occur if construction continues during the period necessary to complete the remand t proceedings.

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-The adverse environmental impacts'of continued con-

!struction whilecthe; remand proce'ed'ings are undertaken mu'st

• L Lise; ass'essed inithe' light-of1what has:already;beenicompleted.- -

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f*- :Afher enumerating 7the? factors,.the~GSP-(.4 F.R. 34,709) k' D~','

_ ~ fcites Coalition'for Safe-Nuclear Power v..AEC,.463-JF. 2d i-95 4 : .(D. 2C. Cir. - 1972) , s where : those' factors are .

~.also enumerated,:sometimes in2ansomewhat more' expanded i

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TheLapplicati~on.for~the Midland permits was' filed'on1 January. -

C3R 1969;-the. construction' permits were not issued until December -

15 , 1972., Nevertheless,.under theEexemption-procedures in ef-fect at itheitime', . authority Lwas extended to the: Licensee-to Tengage in certain preliminary construction lac'tivities prior-s

to.the issuance of the permits.: .Such activities were under-

'taken,'but allisite= activities-were suspended?in November of' 19'70 because prolonged'hearingsJappeared to be inevitable.; ,

However, even,by then, much of the' adverse environmental-im'-

pact oficonstruction had.already occurred.- The status of' site activities at~that. time was.as follows:

" Clearing:and pr.eparation of' site l(80% com-plete);Lsite~~ excavation, preliminary construc-tion ac ivities for nuclear facilties: and l con--

struction work 'on" non-nuclear , facilities (5%

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complete) ;- concrete - placement for substructure

- of: auxiliary building'(75%' complete), for tendon-galleries . (65% complete) andLfor reactor build-

. ing foundations - (20% complete) .

LApplicant's letter, date'd April 18,7 1972. .

~ Oficourse,, construction-was~ resumed after the issu-ance-of:the' permits.; At the. suspension hearing', the Licensee:

intendscto-introduce. evidence describing theLwork that:has-already been done.and the1 amounts expended.q.'The evid'ence  :

L i will "d'emonstrateithat l the 'maj or environmentalz impacts result-fing[fr.om construction 'at the dlant site already have occurred.  ?

.and Ltha t u noisignificant- adverseL impacts ,will' occur as- a result d

of Tconti~nu' ed . construction' during: the perio~d, required ! for com -

f O,  ; pletion fof 5 the remandLproceedings.; ~ That fevidence: will1 also rshowf thati : site. preparation!.is' essentially'-completej includingi

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~ E the! clearance of1 trees .and bushes , excavation ~ of foundations,

preparation of roadways and the1 substantial completion of

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cooling pond-dikes.. lThe reactor building bases have been poure'd.and.the containment' liners erected up to dome levels.

- .The-Licensee will alsofintroduce at the hearing =

. evidence describing .in detail the . work' scheduled to be per-

-formed.for.each month through August of 1977. The evidence will demonstrate 1thatithe adverse impact of continued construc-tion will:either be. transitory in nature-(such as dust, fumes and noise) or redressable.

It must~be rsne'abered that the unavoidable' environ-mental impacts of.constraction were found to be acceptable.

frome the1 standpoint of a cost

• bnefit analysis when the con-struction permits'were initially. issued. This finding, which

was based on the: uncontradicted. evidence, was not challenged

.by'Intervenors. SinceLvirtually1all of the significant-con-struction Snpacts;have already taken place, e.nd.the activities-to be undertaken during'..the period through August, 1977 are but a small . portion of .tte total impacts of construction,

'these. impacts:cannot be'significant in nature.

-2. No~ reasonable alternatives.will be foreclosed by continued construction as proposed.

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- Coalition' and the procedures adopted by the AEC fol-11owing Calvert' Cliffs Coordinating Committee v. AEC, 449 F.2d .

.1109 L(1971) ' demonstrates that. the foreclosure of alternatives Las'sessmentlis:necessarily'a pred'ictive judgment based upon.an

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assessment;ofiwhat' facts are likely.to be' established in later

stages 1of' the' proc'eeding.

ConsequentlyJwe view.the task of'this Boar'd at the suspension hearing 'as similar -to the; task';of' a Court when ~it hasitoLact'onian' application _for-a preliminiry injunction or "

a; stay pen' ding" appeal. .Moreover, .the: Board's judgment as to L

l7 the. probabilities .must - be made 'in . light ~ of the issues remanded ~ '

L' by:Aeschliman.

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a. Fuel reproc'essing and waste-disposal il This-issue has been adequately dealt with in the p

I briefs filed by both the Licensee and.the staff on September.

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_7. 'Both. briefs referred to:the Commission's-language in the.

GSP in concluding that no reasonable'a]ternative's affecting

, 'r'eprocessing and' waste disposal-will.be foreclosed by con-p tinued'constructiow.- ' " Since' existing ~' concepts for reprocess--

4 ing .and. waste . technology .do; not vary sig'nificantly with the

~ design ~of nuclear. power ~ generating-'facil3 ties, it is. extremely.

unlikely that the5(Commission's] revised environmental-survey wil'11 result:1n any modification.-of:these-facilities ~." 41 F.R.

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'5b.. ~ Conservation of energy l-

- -Unit--2 Sis.nowischedul'ed'tolgo' into commercial opera-.

.-. [.tionlinfl981; sand 1 Unit'lfis7scheduledfor1982. ' As is des-

. cribedtin.: greater / detail' in - the section- on . Effects of; Delay, f-  ! infra,:: evidenceiwillShe cintroduced' to:show tha't'ic ;is' nece~ssary; s

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to: meet this schedule in order to assure adequate reserves

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and system reliability. In addition, evidence will . be intro-duced to show that' the feasibility' and probable- ef fect of -

. specific measures for the conservation of energy have been factored intolthe Licensee's demand forecasts.- The evidence will. relate to tlus efforts which Consumers Power Company, the

, Michigan Public Service Commission and Consumers Power's cus-tomers hcve' made with respect to the reduction of the use of

, electrical energy.

c. The Dow Contracts At the suspension hearing, the Licensee will intro-

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duce evidence to show that Dow continues to expect to purchase substantial quantities of process steam from the nuclear plant and electricity from the Licensee's integrated electric system, and to utilizeffossil fuel facilities on a standby or auxili-ary' basis.-

p However, there'have been substantial delays in a

completing.the Midland Plant.' The evidence will show that Dow is operating its present fossil fuel facilities under a t

special.-~ consent order of the Michigan Air Pollution Control Commission and 'that a further order will be ,raquired ' if

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those facilities are to be operated until Unit ~l is placed

- in servic,e in 1982. There can,-of course, Ima no assurance as to what the nature of that order, if any',.will be.-

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.Dow:cannot be' reasonably ~ assured that-the! Midland Plant will;be placed-in service as now' scheduled,-Dow willineed tofconsiderfproceeding/with an alternative source of steam.

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'In short', .the evidence 'will show 'that a suspension now will have the possible effect of foreclosing the very alternative which, caf ter exhaustive early review, was determined to be.

the - mostE desirable. .

d. Clarification of the ACRS letter The'. basis for : the Aeschliman remand with respect to the.ACRS issue was'that the ACRS insufficiently defined the safety problems involved in the following two sentences of its letter (Slip Op. pp. 16-21) :

"Other problems related to large 4

water reactors have been identified by the, Regulatory Staff and the ACRS and cited in previous ACRS reports. The

. Committee believes that resolution of these~ items should apply equally to 4 the Midland Plant Units 1 & 2.-

The. Committee'helieves that the above items can be. resolved during.

construction and.that, if due con-sideration is given.to these. items, the nuclear-units proposed for the

Midland Plant can be-constructed with reasonable assurance that they'can be operated without undue risk to the-health and safety of the public."

The Court heldithat this matter should be rpturned to.the

'ACRS1for clarification of e the ambiguitiesL in the " cryptic-Jreference :to' '.other problems.' '"

Even though these "o 1er -

problens" can~be-identified by reference to'other ACR let-

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Lters,Jthis-Boar'd-cannot. fulfill the mandate of the'Aeschliman

-decision'untillthe ACRS itself issues a. clarifying letter.

This requirementofer~clarifi0ation was imposed.

solely as:a resultsof,the~ court'sfinterpretation of the y 4 - * -m # ,, , e r,

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Atomic Energy Act of 1959, as amended by Pub. L.85-256,

~-71~ S ta t.' ' 5 7 9. It'was not, like the other issues decided by . the court, based on NEPA at all. The distinction is

- significant, for, unlike NEPA, the Atomic Energy Act does not require the.c0LSideiation'of alternatives utilizing a cost-benefit-analysis.

The Atomic Energy Act requirer '; hat certain safety findings be made before construction permits and operating licenses ~are issued.- These are part of the two-step licens-ing process embodied in the Act. Power Reactor Develooment Co. v. International Union, 367 U.S. 396 (1961). In conse-quence, the possible foreclosure of alternatives in the NEPA sense 'is not relevant to the remanded ACRS issue.

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Nothing in the Commission's orders in this pro-ceeding is to the contrary. That portion of the GSP which dealt with the " equitable factors" relating to suspension was in the context of the fuel cycle issue alone - a NEPA issue; and all of the cases there cited by the Commission were also NEPA cases. .The Commission's post-Aeschliman orders relating to this proceeding merely require that the remanded issues be' considered. They do not in any way sug-

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gest that NEPA standards be imposed on a remanded issue which involves 1 purely. Atomic Energy Act considerations.

The-foreclosure of-alternatives is only relevant to the ACRS~ issue where a significant safety problem has' arisen.

However, sit is hardly-likely that.a clarified ACRS letter would lead to the requirement that substantial alternative -designs of Lu . I m --

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reactor. components would be' required'for that reason. .There.

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exists at11 east one significant indication to this effect.

Thatlis;the'ACRS'lexpressed. belief that the~ problems, to t

which itireferred'but failedito identify, "can~be solved

'during construction..." of.the Midland Units, the plans for.

which it hAd revi~ ewe'd.- When these11tems are further1iden-

-tified theLIntervenors may be given-an opportunity.to challenge:this ACRS conclusion. Nevertheless, the ACRS'is an, expert body-made up of independent consultants with wide experience.in the field. At this stage of.the-pro-

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ceeding, there is no reason for this Board to doubt the conclusion of the ACRS when it said that the problems would be. resolved ' pursuant to the present design. This indicates,

- ats least, that the ACRS was not aware of alternatives so much more-favorable as to suggest a substantial change'in >

the'p1'ans for'-the plant. -

3. The-Effects of Delay-

=Under - the present-- cons'truction ' schedule ' Unit 2 is

. scheduled for commercial 1 operation in'1981 with 800 Mw of-

. electrical . generating ' capacity; Unit -1. is sbheduled for service-in 1982:with 50'O Mwe and/300 Mw electrical. equivalent t

steam'generationicapacity. . Evidence will be introduced Edemon'stratingEthe need for; the LUnits to gol on line . as now scheduled.-L Evidence will.also'be' intro'duced to'the effect.

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Iz c :thatLaifoursmonthTsuspension will causeLan18 month delay L- t Ein service dates andnthatfa"12 monthisuspension'Oill'cause g, Tan;;18} month} delay. ~

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The evidence will show that an installed generation reserve of 20% of-projected. load is reasonable and prudent, provided' adequate supplies of power are available for purchase from outside the system. Under the most optimistic assumptions an eight month delay would cause reserves to drop to 20.4% in 1981; and an 18 month. delay would reduce reserves to 13.4% in 1982. .The evidence will show, however, that the 20.4% and 13.4% figures are based on assumptions upon which it would not be prudent to rely.

- These include the- continued avail-ability and reliability of the Palisades Plant at 686 Mwe and the continued availability of Canadian and locally pro-duced oil to fuel a significant portion of Consumers Power Company's generating capacity.

Canadian oil is currently available to consumers Power under special export-licenses gran,ted by the Canadian National Energy Board, which licenses Fre due to expire in

.the nearLfuture. The NEB is currently considering export al-

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location priorities and whether to grant new export licenses for-' oil supplies to Consumers Powe.r. Consumers Power has no assurance 1that such licenses will be forthcoming; nor does it  :

t have any indication of the duration of any licenses which may be granted.

Locally produced oil is available only under-short-term arrangements and, consequently, units operating on such j

- I supplies _have no assurance of continued availability through I

Lthe 1981-82~ period.  ;

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Substitute supplies of oil .from domestic or . foreign

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sourcesftWe not easily obtainable and Consumera Power has no assurance that it~could obtain substitute supplies, should they be required.

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l The unavailability of-the Midland Units as scheduled would increase the amount of electric power that Consumers Power will have'to purchase from other sources in order to meet its L_ responsibilities. Evidence will be. int *oduced showing that reliable. sources for the purchase of such power are not likely to be available and that, if they are, substantial additional costs will be incurred in purchasing such power. during -the l period of delay.'in bringing the Midland Units on line.

l Moreover, additional delays in service dates will l-i ~ delay availability of process steam to Dow, a problem dis-

' cussed-earlier.in this brief. A suspension and.~ subsequent l'

- start-up-will also involve huge additional project costs.

These inclu'de shutdown' costs, additional contract costs-payable to . contractors, . subcontractors and suppliers, ad-ditional engineeringLand. overhead costs, costs for site

, security and protection and maintenance of equipment and L

structures, layoff and rehiring costs, cost's for additional I interest during" construction, escalation. costs and start-up lL l costs. : It- is estimated that these and related costs would total- well in - excess - of $100-million as a- result of a four month: suspension and' sell;in' excess ofs$200 million as a result of a~ twelve month suspension..

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- A suspension.will also impose substantial social costs upon the Midland community and economic hardship on workers who:are. laid off. Testimony concerning the state of the' economy'of'the community and?the impact of suspension upon that economy will be introduced.- That testimony will show that approximately -700 individuals employed at the site will have to beLlaid-off and that, at this time, the economy of the area is such that it will be extremely difficult for those' individuals to flad jobs there. Unemployment among construction workers in Michigan is extremely high. The rip-ple effect within the community can be expected to involve an additional loss of jobs and a reduction of economic activity.

4. The Cost / Benefit Analysis will not be tilted against abandonment by-the additional invest-

-ment during the pendency of the remand pro-ceedings.

Licensee will introduce evidence establishing that the additional investment which will be made if construction is allowed to proceed during the pendency.of the remand proceedings will not alter the economic element of the cost-

- benefit'equationsignificantlyforeithertpealternative of proceedinglwith construction of the Midland plant or the

. alternative of abandoning it and supplying the _needed power

. from~an1 alternative source. When considered together with the-evidence that environmental effects 1due to~ continued ,

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construction _during the pendency:of the _ proceedings are

' negligible. and of .a transitory or redressable nature, this

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evidence (will: establish that 1thel.L status quo' ante ; will 'not be

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, : altered;appreciab1'y;an'd that the cost / benefit analysis, there-

' fore',1will? not L be' tilted.- Moreo'er, v when-this isvidence is compared to tihe evidence. to be : introduce'd on the effects of

~

~ delay, including thSYadditional costs which would be caused by[ del'ay, it._will cleadly.establishLthat the only sensible course is to proceed witP _ construction.

~

Since continued con--

Estructiontwill.>not' tilt:the cost / benefit' analysis for'the~

nuclear. alternative, suspension can hardly be in.the public'

'interest.

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Y iThe elements .of cost which will be conisidered in evaluating the effect on the alternatives of proceeding or abandoning.of~ additional-investment at Midland during-the pendency 1of theLproceedings will include the incremental fcostssto1 complete Midland,' costs of providing an alternative j- <

source.~of power,isalvage values.for Midland, costs associated

~

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e /with:suchtsalvage-activities,' costs of restoration of the Midland! site,.purch'ased power co'stsLduring any interval be-

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L f - tween ~ the scheduled Midland ' service dates and the date on-

/- which/thefalternate.sourcelof-power canibe placed.in; service, f;1 candla~' comparison.of; generating costs for.'Mikland;and:the j

alternate.sourceDof; power.

j J- '5. '- The PublichPolicy Concerns

1. The;needifor)powerLandethe-effects of delay'have-

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% hbkenidiscussed[abdve. TheyJstrongly support continued.-con-

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While' the matters held by the Court of Appeals to befin error were raised in a timely manner, those which were upheld by the Court Lwere a very small percentage of the myriad of exceptions which were raised ~1n this proceeding. This is one of the earliest cases raising NEPA issues. In view of the expanding nature of the body of jurisprudence which developed while this case was being litigated, the fact that some of the objections were ultimately supported by the Court should not give rise to any implication that Licensee ~has acted in such a manner that the equities should be balanced against it.

Moreover, the nature of the errors found is such that suspension would be clearly inappropriate. So far as waste management issues are concerned, Aesch1Lman and its companion case, NRDC v. NRC, criticize the AEC's actions in limiting consideration of such matters before it adopted the fuel cycle rule and-the. procedures followed in connection with adopting the rule. However, nothing in.either opinion

- throws- doubt upon the Commission's view that the incremental environmental impact of the operation of a single reactor upon reprocessing.and waste disposal is limited-and minimal.

So'far.as the energy conservation (issue is concerned, the only error..found was the failure of the Commissicn'to

' investigate.the " colorable alternative" of energy conserva-tion. ~ NothingLhas been shown to support the conclusion thet

. that alternative, if' investigated further byfthe Commission, would dictate a different result. In fact, the Commission P

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did seek the views of all appropriate sources, iceluding the Federal Power Commission, the Michigan Public Selvice Com-

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mission and the Environmental Protection Agency. No federal,-

state or local agency disputed the need for the Midland Plant.

There:is no suggestion-of fault on' the part of the Licensee in this respect, and certainly. severe financial penalties should not be imposed upon it in these circumstances.

The same considerations relate to clarification of-the ACRS letter. At this point, there is no reason to assume that " clarification" will change the result. But even if it did, the Licensee proceeded only af ter its application had been subjected to an exhaustive and searching safety review by the AEC staff which took almost two years.

The Aeschliman dacicion, itself, as well as the governing judicial ard NRC precedents also point to the conclusion that the construction permits should remain in effect. In the brief which the Licensee filed with this Board'on September 2, 1976 (which'we incorporate by refer-ence here) we referred' to the fact that the Aeschliman court chose only to remand, rather than to vacate, even though it had_ before it specific requests for both reversal and injunc-tive' relief. Its failure to reverse was consistent with the recognized practice of courts reviewing administrative orders

txi adjust _ relief .to the . exigencies of the situation in the light of equitable considerations. Our brief of September 2 also pointed. out that there exists ' substantial judicial author-fity under .both NEPA ~and .the ' Atomic Energy. Act to allow permits

-_ _ m m

and licenses to' remain in effect while, at the same time, remanding for further proceedings. Finally, there exists a substantial body of NRC precedent pursuant to which the Ap-peal Board, although finding error in the proceedings b'efore the Licensing Board, has: permitted continuation of activities

, if~ continuation does not constitute a threat to he ith and

~

safety or to the environment. No such threat exists here.

The evidence will show that heavy financial losses will be imposed upon the Licensee if this Board suspends th'e permits. It may be . argued that those losses could have been.

reduced if the Licensee had not begun construction af ter the permits were issued. 'Any suggestion that the Licensee should have minimized its potential losses by not beginning construc-tion is simply irresponsible. The regulatory scheme presumes that construction will begin immediately upon the issuance of the Licensing Board's initial decision. 10 CFR S2.764. Indeed, construction related work is permitted even before that time, !

and Section 185 of the Atomic Energy Act (42 U.S.C. 52234) re-1 quires that the construction permit state the latest date for the completion of construction, a date which may only be ex-tended-for good cause.. f

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Either under the earlier exception regulations or the present limited work authorization regulation.

10 CFR 550.10(e) s 4

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Moreover, in1this cas'e theLadministrative and 1judicialfreview process took over three and one-half years

., .to the point of'the issuance of a decision'by the Court of

~

Appeals. In7 fact, judicial' review is not yet. completed, for-'a1 petition for a' writ of controrari will soon beLfiled

-infthe-Supheme Court. lThe Licensee's~ obligations.to render service <as a public utility were not suspended during this.

period, nor-were.the realities of economic life. Consumers Power had to pr ceed to meet the: anticipated needs of its

-service area;;and, as history shows, every day of delay escalated ~ costs.. Therefore proceeding with construction was a necessity. .

In the circumstances, suspension should not be

-imposed. The law'does not require it. -The equities and public~ policy forbid it.

Respectfully submitted,- -i

)E

Harold F. Reis Lowenstein,'Newman,'Reis & Axelrad 1025 Connectiput Avenue, N.W.

Washington, D.C.. 20015

' Counsel for Consumers Power Company

~ Of-Counsel: .

LDavid?J . ~ Rosso1 Rex R."Renfrow,III' Isham,--: Lincoln &!Beale On'etFirst3 National Plaza

[

Chicago,RIllinois 60603 f

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_  : Septemb'er: 29f,0197.6 :

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JAPPENDIX AL

-PROPOSED: SCHEDULE FOR REMAND HEARINGS-

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9/29/761-'Brief-L10/6-8 --Suspension Hearing 10/20/76c- Proposed-Hearing 10/22/76 - ER information.made'available by'CP.

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10/22/76?-;. Discovery on-applicant'for-ER material commences.

11/01/76~- Alliparties. file' contentions and related discovery

. requests in consequence of issuance of clarified ACRS11etter.-

111/08/76 - other parties file objection to contentions.and to requests for.' discovery. In addition, parties-request-discovery with. respect-to 11/1 contentions made by others.

11/15/76 - Objections to ll/8' discovery requests

.11/22/76 -' Draft DES issued for comment together with supporting staff documents.

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12/06/76--;First date'for discovery requests on ER and sup-plemental DES.

12/09/76 - All allowed ACRS~ discovery complied with.

12/13/76 --Objections to 12/6 discovery requests.

1/10/77 --Hearing-on ACRS issues. commences.

t 2/01/77.- PartiesEdesignate contentions're environmental issues.

L2/07/77 . Objections to contentions and discovery requests on 2/1. contentions.

?2/21/77 - SupplementalLFES issued -and any additional backup 2

material made.available.

2/28/77 - Last day for discovery request re new FES'and

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'backupfmaterial made available on 2/1 contentions, i

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'!3/07/77E : All; objections Lto .2/28 .requestis .to be filed..

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D3/18/77.i- A114allowedcdiscovery requests to be' complied--with.-

3230/77. ': Hearing 7 commences..

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N/13/77{' Proposed' finding's 1

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-APPENDIX B-PROPOSED' SCHEDULE FOR-REMAND EEARINGS-IF= OCTOBER 6-HEARING IS CONTINUED ,

9/29/76i : Brief-r10/22/76: -

ER,information made available by CP.

?l0/22/76' '-- ~D iscovery on applicant for ER material commences.

s

~ -

Suspension Hearing

---

Proposed Findings (10 days after Hearing) 11/22/76 ' -

.Draf'tTDES issued for. comment together with. supporting staff documents.

~ 12/17/76 -- - First date.for. discovery requests on ER and supple-mental DES.-

.All parties file. contentions and related discovery-requests in consequence of issuance of clarified

.ACRS letter, 12/30/76 -

~ Other parties file objection to contentions and.to

? requests-for discovery. . In addition, parties.

request discovery with' respect to 12/17-contentions made by others.

1/06/77- -

Objections to 12/ 30 discovery requests.

1/21/77 - t

-A11~ allowed 12/17. discovery requests complied-

=with, f 2/01/77 ~ - ' Parties designate contentions re environmental issues.

2/07/77; -

10bjections to contentions and discovery requests

en 2/1 contentions.

2/21/7.71 --- Supplemental'FES[ issued and any additional backup materialimade available.

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2/28/77' '- '.Last-day!for discovery ~ requests re new FES and backup. material made'available on 2/1 contentions.

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3/07/77' --

' 'All objections-to'2/28 requests'to be filed

. 3/18/77 - ;All' allowed 2 discovery requests to be complied with.

3/30/77:~- Hearing: commences.

I- -

14/13/77. --- Proposed' findings.

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' UNITED ~ STATES OF AMERICA

. NUCLEAR. REGULATORY COMMISSION Before the Atomic Safety and Licensina-Board

' Inithe Matter of- -)

')

CONSUMERS POWER COMPANY- ) Docket Nos. 50-329

) 50-330 (Midland Plant, Units 11& 2 )- -) ~

4 A

. CERTIFICATE OF SERVICE I_ certify that copies of the attached "Brief of Consumers Power-Company in Response-to Board Order of September 21,'1976," dated September 29, 1976,~ were served upon the following by deposit inithe United States. Mail, postage prepaid;and; properly addressed, on the 29th day of-September, 1976.

~Mr. C._R.-Stephens Chief,' Docketing'and. Service Section Office'of.the' Secretary of1the Commissior U.S. Nuclear Regulatory Commission Washington,~D.C. .

20555 Richard _ Brown,. Esquire

~

Counsel for NRC Staff

.U.S.: Nuclear' Regulatory Commi'ssion

. Washington, D.C. . -20555-

~

'Myron M.-Cherry, Esquire Suite 4501 One' IBM 1 Plaza.

Chicago ~, Illinois 60611

~ James N'.'O'Connor,~ Esquire-TheLDow Chemical Company

-2030 Dow? Center-

~ Midland, Michigan :48640 LMilton R. . Wessel,' Esquire

'4 .L i t t l e .. L a n e LWhite Plains,_New York .

10605 T

~

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'Howard-J'.!Vogel, Esquire 2750-Dean Parkway.

. Minneapolis, Minnesota- 55416.

~

The Honorable' Curt ^T. Schneider Attorney _ General-1st: Floor, State. Capitol Building-Topeka', Kansas 66612 -

l l

Daniel 1M.-Head, Esquire, Chairman Atomic Safety andLLicensing Board Panel U.S.--Nuclear Regulatory. Commission i Washington, D.C. 20555 Dr. Emmeth-A.=Luebke,_ Member' Atomic Safety and Licensing Board Panel U.S. Nuclear Regulatory Commission Washington, D.C. 20555 Dr. J. Venn Leeds,-Jr., Member

-10807~Atwell Houston, Texas 77096

/ . .

Harold F. Reis Lowenstein,1Newman, Reis & Axelrad 1025 Connecticut Avenue,-N.W.

Washington, D.C. 20036 (202) 833-8371 September.29, 1976' Counsel for.

Consumers Ppwer, Company

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