ML19347B386

Affidavit Re Allens Creek Vs South Tx Project Sites.Cost Comparison Tabulation Encl

ML19347B386
Person / Time
Site:	Allens Creek File:Houston Lighting and Power Company icon.png
Issue date:	09/30/1980
From:	Mccuistion R HOUSTON LIGHTING & POWER CO.
To:
Shared Package
ML19347B383	List: ML19347B382 ML19347B385 ML19347B386 ML19347B387 ML19347B388 ML19347B389 ML19347B390 ML19347B392 ML19347B393 ML19347B394 ML19347B396 ML19347B398
References
NUDOCS 8010140554
Download: ML19347B386 (12)

Text

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1 UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD In the Matter of S

S HOUSTON LIGHTING & POWER COMPANY S

Docket No. 50-466 5

(Allens Creek Nuclear Generating S

Station, Unit 1)

S AFFIDAVIT OF ROBERT M. McCUISTION I.

My name is Robert M. McCuistion.

I am the Vice President for Power Systems Development of Houston Lighting

& Power Company.

In this capacity I am responsible for power plant siting, and the location of power plant sites for Houston Lighting & Power Company's new power plants.

II.

The Allens Creek site is one of the highly de-sirable sites now av'allable to the Company for construction of new generating capacity.

In the event the Company were precluded from constructing ACNGS Unit 1 at the site, I believe that the Company would construct other facilities at that site.

The reasons for this are obvious.

First, the Company owns all of the site.

It is a significant task to acquire a site this large and the fact that the Company already owns the site would weigh heavily in favor of its

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use for another power plant.

Second, the Company has a contract for a water supply from storage reservoirs in the Brazos River Basin for development of future power plants along the Brazos River.

This supply is not contingent upon any particular kind of power plant being constructed at the Allens Creek site.

Third, the site has been extensively reviewed from an environmental standpoint and there are no inherent difficulties with siting a plant at that location.

Fourth, the site is idea.ly located for purposes of trans-portation routes both from the standpoint of railway and highway access.

III.

Aside from the foregoing point, TexPirg's entire contention is founded on the mistaken notion that HL&P has a right to construct an individually-owned nuclear unit at the STP site.

As a matter of background, the STP site was chosen with a view toward the proximity of the site to the respective load centers of the STP Participants.

Moreover, this fact makes the site highly desirable for expansion to accommodate future joint plants, and in contemplation of that value, the STP Participation Agreement defines the rights of the parties with respect to the location of future units.

Under the terms of the Agreement, neither HL&P nor any other Participant has the right or power to build a.

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third unit at the South Texas Project site except in con-l junction with one or more of the existing Participants and l

unless the two or more Participants desiring to build the unit own a 50% interest in Units 1 and 2.

Furthermore, each Participant is entitled to participate up to its present interest in a third unit, and if one or two Farticipants having less than a 50% interest do not participate, those choosing to join in the construction of the third unit have the right to share the portion of the third unit attributable to the interest of any Participant not joining.

Units 1 and 2 are owned by the Participants in the following undivided shares:

City of San Antonio, Texas, acting i

I through the City Public Service l

Board of San Antonio (CPSB) 28.0%

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Central Power and Light Company (CPL)

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25.2%

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Houston Lighting.& Power Company (HL&P) 30.8%

l City of Austin, Texas (COA) 16.0%

Accordingly, if HL&P proposed to construct Unit 3 at the South Texas Project site, it could do so only if CPSB or CPL joined, and it would have no assurance that it would be entitled to more than a 30.8% interest in the unit and the power generated thereby.

i The terms of the South Texas Project Participation l

Agreement were the result of negotiations between the l

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Participants and have the purpose of protecting for future use the investments made by all Participants, not just HL&P, while at the same time providing a practical degree of flexibility.

Events since the execution of the Agreement J

have materially increased the need for protecting each t

South Texas Project Participant's rights in any prospective

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units at STP.

i Thus, for all practical purposes EL&P would be i

precluded by the terms of the STP Participation Agreement

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from constructing a third unit at the STP site with capacity equivalent to ACNGS and fully committed to HL&P.

1 IV.

TexPirg is also in error in assuming that HL&P could definitely obtain additional water supplies from the Colorado River.

The existing arrangements for the cooling water supply for the South Texas Project contemplate that a i

102,000l acre-feet per year appropriation from the Colorado River, under Permit No. 3233 issued by the Texas Water Rights Commission (TWRC) on February 24, 1976, will be the i/

Since execution of the Agreement other plans for -

another jointly owned nuclear power plant, which was to include all of the STP Participants plus the Lower Colorado' River Authority, were discon-tinued.

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i basic source of supply.

An' evaluation of this supply, based on a 23 year historical pattern of river flows and allowing 1

for all existing senior rights, was used as the bases for both the appropriation and the South Texas Project Construc-i tion Permits.

This evaluation reflects that:

(i) in most 1

years less than 102,000 acre-feet will be available for diversion under Permit No. 3233 (our study shows that under i

the termc of the permit, the average annual availability is in fact onir 55,000 acre feet); (ii) that the water avai1+

able for diversion under Permit No. 3233, when stored in the 2

7,000 acre reservoir at the South Texas Project site, will i

provide a dependable supply for the operation of two units; i

j but (iii) that a fixed amount of water each and every year from upstream reservoirs likely would be necessary to pro-i{

vide a dependable supply for more than two units.

While the Participants in the South Texas Project have a contract with the Lower Colorado River Authority (LCRA), owner and operator 1

of upstream reservoirs on the Colorado River above Austin, Texas, to provide water from the LCRA reservoirs "necessary i

for the normal operation and maintenance of the integrity of

[ Units 1 and 2]," the contract does not call for specific amounts of water from the LCRA reservoirs each year as would l

now appear necessary if i third unit were located at the l

South Texas Project.

Conversely, as is demonstrated in

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Section 9.2 of the Allens Creek Environmental Report, there is an ample supply of water from the existing storage on the Brazos River for one or more units at the Allens Creek site.

The eventual outcome of two presently pending legal proceedings could result in the reassessment of the water supply for additional units at the South Texas Project; however, there is no way to determine when those proceedings will be terminated.

The first proceeding involves the adjudication of wcter rights in the Colorado River under the Texas Water Rights Adjudication Act (Section 11.301, et seq., of the Texas Water Code).

The outcome of this pro-ceeding could result in an increase in the water available under Pennit No. 3233; however, there has been no final determination on this question by the Texas Water Commission (TWC), the adjudicatory arm of the Texas Department of Water Resources (TDWR).

In light of the importance of this pro-ceeding to the numerous water users on the Colorado River there is a reasonable expectation of appeals from any deci-sion by the TWC.

The sccond proceeding involves an application for Stacy Reservoir, a proposed reservoir on the upper reaches of the Colorado River with the planned capacity of about 550,000 acre-feet of water.

This application was granted by the TWC.

The LCRA, which protested this new reservoir before._

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the TWC, has appealed the action of that agency to the courts, asserting that the new reservoir would significantly i

affect the yield of the LCRA's reservoirs near Austin, Texas.

Others have also protested this application, and have appealed.

The matter is now pending before an inter-mediate appellate court of the State of Texas.

Resolution of this dispute could be a basis for a reevaluation of availability of reservoir water with respect to additional

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units at the South Texas Project.

However, absent final I

j resolution of either or both of these legal proceedings, i

which cannot be reasonably anticipated within the time frame required for a decision on HL&P's proposed Allens Creek Unit i

1, there appears to be no basis for a reassessment of the l

water supply arrangements for the South Texas Project.

V.

TexPirg has also ignored the fact that HL&P has

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obtained or applied for nearly all of the permits required from other state and federal agencies.

Of particular i

i importance is the fact that HL&P has received a certificate of Convenience and Necessity from the Public Utility Commis-sion for the Allens Creek Nuclear Generating Station and associated transmission lines.

NRC review has progressed to an advanced stage.

Determinations of site suitability have already been made by the NRC Staff (see SER Chapter 2),

the ASLB (PID t 's79-133), and the ACRS.

Although one mi'Tht expect expedited review of an additional unit at the STP site, additional staff, ACRS and ASLB review of some signif-icant duration would be required and clearly the necessary approvals would not be forthcoming within the time frame contemplated for approval of the ACNGS.

VI.

Mr. Johnson.'s attempt to calculate the costs of moving ACNGS to STP is clearly inadequate.

HL&P has in-vested millions of dollars in site studies, detailed en-gineering, legal fees, etc., virtually all of which would be lost and would have to be duplicated for location of any additional unit at STP, or anywhere else.

Our preliminary evaluation shows that the engineering and plant costs as-sociated with the move would be in the' range of $778,431,000 3

to $819,765,000, exclusive of the non-recoverable costs which I have not estimated.

(Exhibit No. RMMc 1).

The additional engineering and site studies required for location of ACNGS Unit 1 at STP could take two to three years to prepare.

At that point the project would just be at the point in the licensing process that it is now.

Under this scenario it is impossible to get the project on line by 1988.

Each year that the project is delayed beyond 1988 will cost an average of $300 million in differential fuel costs alone.

We have

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4 only assumed a two year delay for purposes of calculating these costs in Exhibit RMMc.1.

If the delay were more than i

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two years the costs would go up accordingly.

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If ACNGS Is Moved To STP Site Detail of Items Costs Saved-a/

-a/

Costs Incurred 1.

Site improvements (assume 2/3 of AC cost for drainage, roads, grading c/

d/

saved)

$3,616,000

$1,205,000 2.

Circulating water discharge canal c/

(not needed at STP) 1,665,000 0

3.

Concrete (10-20% more concrete required d/

7,750,000-15,000,000 at STP due to soils) 4.

Redesign and enlarge IIVAC system due to changes in chilled water system (in-d/

crease AC cost 10-20%)

2,000,000-4,000,000 5.

Larger piping, hangers and valves d/

required at STP (5-10% cost 4,600,000-9,200,000 increase) 6.

Electrical (4 kv transformer for c/

AC not needed at STP) 800,000 7.

Redrafting of 200 completed AC drawings 6,450,000-9,400,000-d/

8.

Engineering design (redesign 14 d/

of 78 AC systems) 6,668,000 9.

Purchasing (rebid 25 of 242 AC specs) 200,000-d/

10.

Additional studies (i.e., geotechnical hydrological; meterological; c/

seismic; ecological; radiological) 4,050,000 '

Exh. No. RMMc 1

a/

a/

Item Costs Saved Costs Incurred I.

Reservoir

$40,000,000~c/

0 A.

UHS (construct embankment for e/

STP-type UHS) 3,000,000 II.

Construction d/

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A.

Direct (Items 1-6) 6,081,000 15,555,000-29,405,000 B.

Indirect (Management and 16,488,000-d/

Supervision) 30,588,000 d/

12,201,000-22,635,000

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III. Engineering and Services (Items 7-10) 17,368,000-20,318,000~d/

b/

c/

IV.

Material Replacement 6,500,000 V.

Land taxes 1973-1980 476,000~c/

g/

c_/

VI.

Escalation for Two Years 200,000,000 g/

f/

VII.

Differential fuel costs for two years 600,000,000 62,569,000-76,669,000 855,100,000-882,334,000 Therefore the net cost of leaving ACNGS and moving to STP falls in the range of:

$778,431,000-$819,765,000 a/

Costs were obtained from latest AC Cost f/

From HL&P Corporate Planning Dept.

estimate and PMO judgment.

g/

Two years required to return to present b/

Replacement of equipment (condensor, tubes, state of licensing.

etc.) due to design changes.

c/

From latest AC cost estimate.

d/

From AC PMO judgment.

e/

From latest STP cost estimate.

UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD In the Matter of S

S HOUSTON LIGHTING & POWER COMPANY S

Docket No. 50-466 5

(Allens Creek Nuclear Generating S

Station, Unit 1)

S AFFIDAVIT OF ROBERT M. McCUISTION STATE OF TEXAS S

S COUNTY OF HARRIS S

I, Robert M. McCuistion, Vice President, Power Systems Development, Houston Lighting & Power Company, first being duly sworn, upon my oath certify that I have reviewed and am thoroughly familiar with the statements contained in the attached affidavit and that all my statements contained therein-are true and correct to the o of my knowledge and belief.

L e_

Robert M. McCuistion Subscribed and sworn to before me )de/av y the said McCuistion on this Sp day of A

Robert M.

1980.

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MsAluf) nlLJ Notary Publicvin and for Harris County, Texas

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