ML19347B416

Trial Brief Concluding That Proposed License Conditions Are Inadequate to Cure Situation Inconsistent W/Antitrust Laws. Lists of Witnesses,Exhibits & Testimony & Certificate of Svc Encl

ML19347B416
Person / Time
Site:	South Texas, Comanche Peak
Issue date:	10/08/1980
From:	Landsman R, Poirier M, Spiegel G BROWNSVILLE, TX, SPIEGEL & MCDIARMID
To:
References
ISSUANCES-A, NUDOCS 8010150024
Download: ML19347B416 (105)

Text

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UNITED STATES 0F AMERICA NCCLEAR REGULATORY COMMISSION SEFORE THE ATOMIC SAFETY AND LICENSING SOARD In the Matter of )

HOUSTON LIGHTING & PCWER COMPANY ) NRC Cocke t Nos . 5 0-49 8 A PC3LIC SERVICE SCARD OF SAN ANTONIO ) 50-499A CI"Y CF AUSTIN )

CENTRAL PCUER AND LIGHT CCMPANY )

(South Texas Proj ect, Cai: Nos. 1 ) '

and 2 ) )

) l TEXAS CTILITIES GENE.MTING ) NRC Docket Nos. 50-445n CCMPANY, et al. ) 50-446A

( Cemanche7eak Ster.3 Electric )

S ta:icn, Units 1 and 2 )

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l N  % INITIAL TRIAL BRIEF I'

OF THE PUBLIC UTILITIES BOARD 4 OF BROWNSVILLE, TEXAS 0? o% <

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OCT ~ g -3

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Otr kketin gfkfty 4 \

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y George Spiegel m Ron M. Landsman Marc R. Poirier Attorneys for the Public Utilities Board for the City of Brownsville , Texas Law offices of:

Spiegel & McDiarmid 2600 Virginia Avenue N.W.

Washington, D.C . 20037 Cc:ccer 3, 1980 S

80101s ooy/ g

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TA3LE OF CONTENTS i

q Page j I. INTROCUCTICN ...................................... 1

!!. S ACK GROU ND S TAT EM ENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 l A. The Parties .................................. 6  !

III. THE PROPOSED CONDITIONS AND RELATED SETTLEMENT AGREEMENTS ARE INCONSISTENT l WITH "5E ANTITRUST IAWS AND OTHERWISE UNLAWFUL, UNREASONASLE, UNFAIR AND l CONTRARY TO THE PUBLIC INTEREST .................. 10 A. The Agreement No t To Engage In Interstate Commerco Violates

Sections 1 And 2 Of The Sherman j Act And The Pattern Of Interstate-

only Interconnections Is Inconsistent j With The Policies Of The Antitrust i Laws ......................................... 10 i

! 1. The agreement ........................... 10

2. The agreement constitutes an i unreasonable restraint ci 4

' ade in violation of Section 1 . . . . . . . . . 15

a. Per se unreasonableness ............ 15

b. Unreasonableness under t h e Ru l e o f Re a so n . . . . . . . . . . . . . . . . . 20

3. The agreement constitutes a i conspiracy to monopolize in violation of Section 2 .................. 24 j 4. Latrastate-only interconnections are inconsistent with the policies i

4 of the antitrust laws .................... 25 i

j 3. The Proposed License Conditions Fail To Cure A Situation Flatly Inconsistent I

Wi th The Antitrus t ' Laws ...................... 27

1. The standard ............................ 27 1

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Pace

2. The inadequacy cf the license conditions ...................... 29

a. No new substantive duty is imposed on ELP respecting interstate interconnection ......... 29

b. Such right as is created is subject to severely burdensome procedural impediments ........................ 32

c. The conditions do not endo the entrenched ef fects of 45 years of agreement to restrain trade ..................... 33

3. The DC asynchrcnous interconnection does not cure the situation inconsis tent with the antitrust laws .................................... 38 CONCLUSION ............................................ 39 IV. Lis t of Witnesses , Exhib its and Te s timony . . . . . . . . . 40 A. FERC Proceeding .............................. 40

3. SEC Proceeding ............................... 40 C. Federal District Court, Dallas Texas ......... 42 D. Public Documents from the SEC I and the FERC ................................. 46 E. Deposition Evidence from NRC Proceeding ...... 47 F. Discovery Evidence from NRC Proceeding ....... 48 G. Live Government Witness ...................... 50 Appendix l

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TABLE OF AUTHORITIES Page 4

i Cases Addysten Pipe & Steel Co. v. United States, 175 U.S. 211 (1599)................................. 17, 19 A=erican Tobacco Co. v. United States, 328 U.S. 781 (1946)................................. 24 4 Associated Press v. United States, 326 U.S.

_ (1945)............................................ 20 A:1 antic Refining Co. v. FTC, 381 U.S. 357 (1965)..................................... 29 Ecwen v. New York News, Inc., 522 F.2d 1242 (3d Cir. 1975), cert. denied, 425 U.S. 936 (1976).............................................. 17 Central and South Western Corp., SEC Admin.

Proc. File No. 3-4951............................... 14, 15 Central Pcwer & Licht Co., FERC Docke t No.

EL79-a.............................................. 39 Central Pcwer & Light Ccmpany v. Public Utility Cet=1ssicn of Texas, No. A-77-CA-36 (W.D. Tex.,

Aus: n Div. 1973)................................... 14 Central Pcwer & Light Ccmpany v. Texas Public i U: 110:es Cetmission, 592 F.2d 234 (5:n Cir. 1979)..................................... 14 i

Chicago Scard of Trade v. United States, 246 U.S. 231 (1918)................................. 16, 21,

) 22, i City of Statesville v. AEC, 441 F.2d 962 I

(D.C. Cir. 1969).................................... 39 Censumers Pcwer Co. (Midland Plant, Units 1 and 2), ALA3-452, 6 NRC 892 (1577).............................................. 29 Ocneinental Ore Co. v. Union Carbide & caxben Corp., 370 U.S. 690 (1962).......................... 25 Continental T.V., Inc. v. GTE Sylvania, Inc.,

433 U.S. 36 (1977).................................. 17, 21 Oc;per Licuer, Inc. v. Adciph Ccces Co.,

506 F.2d 934 (5th Cir. 1975)........................ 22

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Page Fashion originators' Guild v. FTC, 312 U.S. 457 l (1941).............................................. 18, 19 Giant Paper & Film Corp. v. Albemarle Paper Co.,

430 F. Supp. 981 (S.D.N.Y. 1977).................... 25 FTC v. Brown Shoe Co., 384 U.S. 316 (1966).............. 29 FTC v. Raladam Co., 283 U.S. 643 (1931)................. 28 FTC v. SPe:try & Hutchinson Co., 405 U.S. 233 (1972)..... 29 FTC v. Texaco Inc., 393 U.S. 223 (1968)................. 29 Houston *ighting and Power Company, Texas PUC, Docke No. 14, Amended Final Order, July 11, 1977....................................... 14, 15 Kansas Gas & Electric Co. v. Kansas City Power

& Light Co. (Wolf Creek Generating Station, Untes No. 1), NRC 1 75/6, (ALAB 279)

(1975).............................................. 29 Kestenbaum v. Falstaff Brewing Co., 575 F.2d 564 (5th Cir. 1978)................................. 22 Lewis v. ,Pennington, 400 F.2d 806 '6th Cir. 1968)....... 25 Lorain Journal Co. v. United States, 342 U.S.

143 (1951).......................................... 18 National Society of Professional Engineers v.

United States, 435 U.S. 679 (1978).................. 16, 20, 21 otter Tail Power Co. v. United States, 410 ,

U.S. 366 (1973)..................................... 18 1

I Ply =cuth Dealers' Ass'n of Northern California v.

United States, 279 F.2d 128 (9th Cir. 1960)......... 17 Standard 011 Co. of California v. United States, 337 U.S. 293 (1949)..................... ........... 20 l

Standard oil Co. of New Jersey v. United States, 221 U.S. 1 (1911)................................... 16

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4 Page Timken Roller Searing Co. v. United States, 2 ,., ,.s.

.. :32 (.34.s,).................................

3 e Tvsons Corner Regional Shopping Center, 85 FTC 970, modified, 86 FTC 921 (1975).................... 18 U.-ited States v. Arnold, Schwinn & Co., 388 U.S.

365 (1967).......................................... 22 United States v. Colgate & Co., 250 U.S. 300 (1919)..... 20 United States v. Consolidated Laundries Corp.,

291 F.2d 563 (2d Cir. 1961)......................... 24 United States v. Consolidated Packaging Co.,

579 F.2d 117 (7:n Cir. 1978)........................ 19 United States v. Container Corp. of America, 393 U.S. 333 (1969)................................. 16 United States v. DuPont & Co., 351 U.S. 377 (1956).............................................. 24 United States v. Empire Gas Co., 537 F.2d 296 (3:n Cir. 1976), cero. denied, 429 U.S. 1122 (1977).............................................. 26 United States v. Gasoline Retailers Ass'n, 285 F.2d 655 (7th Cir. 1961)............................ 17 United States v. General Motors Corp., 369 F.Supp. 1306 (E.D. Macn. 1974)..................... 25

'Jnited States v. General Motors Corp., 384 U.S. 127 (1966)..................................... 17 United States v. Grinnell Corp. , 384 U.S.

563 (1966).......................................... 24 United States v. Hilton Ectels Corp., 467 F.2d 1000 (9:n Cir. 1972), cert. denied, 409 U.S.

1125 (1973)......................................... 17 United States v. Nationwide Trailer Rental Systems, Inc., 156 F.Supp. 800 (D. Kan.), aff'd per curiam, 355 U.S. 10 (1957).......................... 17 l

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Page United States v. Saceny-Vacuum Oil Co., 310 U.S.

150 (940).......................................... 16 United States v. Sealy, Inc., 388 U.S. 350

.i y,o- i ........................ .................... 17 "nited States v. Topcc Associates, Inc., 403 U.S. 596 (1972).................................... 16, 17 United States v. Trenten Potteries Co., 273 U.S.

392 (1927)......................................... 16 West Texas Ceilities Ccepany v. Texas Electric Service Ccmpahy , 470 .:.Supp. 798 (N.D.

Texas 1979), appeal pending, No. 79-2677, 5th Cir............................................ 11, 12, 13, 15, 34, 35 Statutes Atomic Energy Act 5105, 42 U.S.C. 52135.............................. 27-32 5.1 a t a ) , 42 U.S.C. 52236(a)........................ 30 0.;per-Velstead Act 51 7 U.S.C. 5291...................................... 35 Clay en Act, 15 U.S.C. 512 et seq...................... 25, 28 Oc==unica icns Act 5221, 47 U.S.C. 5221 .............................. 35

.rederal Aviation Act 5414, 16 U.S.C. 5384 .............................. 35

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0 Y Page

.cederal Crade Commission Act 18, 27, 28, 55, fl5 C.S.C. S45.................................

29, 34 McCarran-Ferguson Act $2b 17 U.S.C. 51012(b)................................. 35 Public Utility Regulato ry Policies Act of 1968. . . . . . . . . 32

' 5210, 16 U.S.C. 58241.............................. 33 5211, 16 U.S.C. 5324j.............................. 33 5212, 16 U.S.C. 5824k.............................. 33 i

1 Sherman Act, 15 U.S.C. 51 e t seq....................... 25, 26 Section 1, 15 U.S.C. 51............................ 10, 14, 15-23, 26, 28, 34 Section 2, 15 U.S.C. 52............................ 10, 18, 24-25, 26, 28, 34' Miscellanecus

ational Commission for the Review of Antitrust

• aws and Precedures , Report to the President and the Attorney general (1979)................... 26 Reper: cf the Joint Committee on Atomic Energy, S. Rept. 91-1247, 91st Cong., 2d Sess.

(1970)............................................. 28 J

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• UN!TED STATES OF AMERICA 4 NUCLEAR REGULATORY COdMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD In the Matter of )

ECUSTON

• IGHTING & POWER COMPANY ) NRC Docke t No s . 5 0-49 8 A PUBLIC SERVICE SCARD CF S AN ANTONIO ) 50-499A CITY OF AUSTIN )

CENTRAL POWER AND LIGHT COMPANY )

(South Texas Project, Unit Nos. 1 )

and 2) )

)

TEXAS UTILITIES GENERATING ) NRC Docket Nos . 5 0-4 4 5A COMPANY, et al. -

) 50-446A (Comanche feak Steam Electric )

Statica, Units 1 and 2 )

1 INITIAL TRIAL BRIEF OF THE PUBLIC UTILITIES BOARD OF 3ROWNSVILLE, TEXAS i

1 I. INTRODUCTION.

This is the Initial Trial 3rief of the Public Utilities Board a

of Irownsville, Te xas . Brownsville will supplement this Initial 3rief if the scard permits , in view of the current posture of the l l

case and the changed circumstances due to the proposed l l

s e ttlement . .

l We believe that Brownsville 's pending motion to rej ect the proposed conditions and related settlement agreements should be decided before the procedures for hearing are set, and they, in turn, should be set before the time for Trial 3rief s expires (otherwise today) . This is the lawyer-economical procedure and will minimize waste and duplication otherwise obtaining if proce-1 dures differ from those contemplated by the Trial 3rief s. l In Part III we state Brownsville's position that, as a matter of law, parts of the proposed settlement are incons is ten with the antitrust laws and theref ore cannot afford a basis for decid ing the interrelated South Texas and Comanche Peak license

2-applica: ens. Tc the extent that the Board cons iders that fac-

ual cons iderations are involved in this legal ques tion, it can i

, look :c Brownsville's extensive evidence (Part IV below) wh ic.

can be increduced into the record with very little lawyer-expense. Thus, the ultimate question of the legality or

, J ustness of the settlement can be deter =ined at the outset in j order : avoid a long expensive hearing which would come to J

naught if the Board thereaf ter determines that the Settlement conditicas are bad as a matter of law, and a new hearing must be

initiated.

Further, despite the many protestations, it is clear that the I se::lement is not final and CPL at least can withdraw from its support of the conditions in at le as t two obvious contingencies :

(a) either the FERC or SEC proceeding is not disposed of to the satisf action of CPL, or within satisf actory time limits; 1/ even l

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SEC, Aug us: 12, 1980:

1. Counsel for CSW (Tr. 3757): I "MR. REIGER: I think that the settlement agreement itself does provide in paragraph 4 toward the end, that l the entry of an order by FERC denying the amended appli- l cation or the f ailure of FERC to grant or deny within

one year of the date of the agreement which would take you down to June of 1981, would have an ef fect on i opening up proceedings before the NRC wnich has to do f

with antitrust que s tions . "

1 (Tr. 3758): l "MR. REIGER: Right. No w, it may be that things would progress suf ficiently so that without pre 3 udicing any of the parties' rig ht to go back to ground 0 if it falls down, that the SEC order might precede the formal

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at :nis late da e, CSW has no: filed its long-trumpe:ed revised of fer of settlement a FERC; an/. (5 if Department of Justice, Brownsville, or others prevail at FERC and the Commission orders an AC interconnection, or denies ELP and/or TU its exemption fran FERC J urisdiction, ELP and/or TU apparently can withdraw from the Set:lement, withdraw support for the ;co;;osed conditions, and ,

precipitate C?L withdrawal frcm the Settlement.

In su= mary, three contingencies new hang over the proposed conditions : (i) Board disapproval on legal or other grounds; ( ii)

CPL withdrawal; and (iii) ELP and/or TU withdrawal. Any of thes e might cecur before , during or af ter hearing . This then leaves the parties in a quandry: do they present a case based on the entry of the FERC order. I don' t know. But, i[n] any event, that is how the documents are draf ted ."

(Tr._3759):

"MR. REIGER: Paragraph 7 describes it under CST?

No, it is under 3. It is one of the conditions to the ef f ectiveness of the settlement agreement is the entry of a final -- quote , "The entry of a final and unap-pealable order by the SEC, (based upon findings to be made in its administrative proceeding filed No . 3-49 51

2. Counsel for TU: Ka rlyr Sampels (Tr . 37 60 ) :

"In some cases , as a practical matter , we are dealing with a chicken and an egg situatior, but I don't think anybody doubts that if the matter is solvable as contemplated by the parties , that all of the various contingencies that must occur will occur but it does not necessarily mean that one must occur exactly before another but they are all going to have to be conditioned upon the occurrence of all of the contingencies that are ou tlining the settlement ag reeme nt . "

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premise that conditions are satisf actory to the Scard and non-w::hdrawable b.v anv. c.arties, or do they present a case assumine. i i

the condi:icas will self-destruct, or do they present a dual case covering both contingencies?

Brownsville 's dif ficulties are enhanced by additional i

fac:ces:

(i) A single small city can not afford to present on  :

1 its own a full-blown judicial-type antitrust case, nor should the l

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i procedures adopted by a federal administrativo agency be such as ,

i to deprive such city of its rights unless it undertake such a burden. Brownsville will be denied due process if the price fo r protecting its rights is unrealistic. Justice in America, at least before a non-judicial administrative ag e ncy , should not carry an excessive price tag. i (ii) Brownsville had anticipated that the principal pro-tagonists (CPL, ELP , and TU) and public defenders (NRC and Justice Staf fs) would make a full record so Brownsville could 1 i

participate on an economic basis.

Brownsville now needs to regroup, and it should have the i

benefit of the Board's ruling on the Settlement and determination  ;

of procedures, along with a little time, to revise its Trial 3rief on an economic basis. At this point , Brownsville is a 165-pound punt receiver watching (i) the ' call slowly descending in:o his arms, and (ii) five 280-pound Dallas Cowcoy linemen cen-verging en his frail body at a 10 second per 100 yard clip; so Brownsville must reluctantly raise its right amn to the Board for the nercy of a " f air catch" ruling .

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. i 3 cwnsville herein proposes , in the interes t of agency and a::orney economy, to present a documentary case in primary part l which will minimi:e as f ar as possible the expense of calling live witnesses, having in =ind hat administrative agencies we re crea ted for the purpose, among others, of dealing with broad public interes: =atters withee.t the technicality and costs of Judicial proceedings, and assuring justice to the small people.

NRC has the authority to deal flexibly with the hearing and evidence-ga thering process . Thus, Brownsville will of fer in:o evidence much of the testimony and exhibits of CSW in the SEC and Dallas District Court proceedings, along with the facts in its verified application to FERC. This will save substantial time and expense for all parties, there being no need to dupli-cate testimony already presen:ed and thoroughly cross-examined by l

the protagonists here . In addition, Brownsville will of fer into evidence many documents from the files of the parties from which  !

the Board can draw appropriate inferences and conclusion. l 3rownsville will also rely on the taking of of ficial notice ou:

of the =any public reports of the parties as well as other public  ;

l records.

Brownsville will also .of fer into evidence transcripts of depositions of certain witnesses, again on the theory cf economy since we see no need to call witnesses in to read what they have already testified to. If further cross-examination is required ,

that can be arranged . We recognize that the Board has stated a general cpposition to such use of depositions but we believe l

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that, in the changed circumstances under which Brownsville may be lef: with the total trial burden, the Board should reconsider

s po sition.

Brownsville also anticipates calling as live witnesses experts who have been used by the government agencies to review the f acts

, relating to this controversy and are therefore immediately f ami-

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liar with it and possess knowledge and opinions which will be J

helpful to the Board in reaching its decision. This will provide j a useful product for the taxpsyer money expended, and we trust l

that NRC and Justice will cooperate. 1 1

l Brownsville , in the time available , has not been able to pre- l l care its sum = aries of testimony, but is continuing forthwith to i

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do this. l i

Brownsville reserves the right to refine and to eliminate parts of its proposed evidence and to introduce other evidence, i all pursuan: to Board rulings.

II. SACKGROUND STATEMENT.

A. The Parties.

Three large utility systems or their operating companies are the applicants for nuclear cperating licenses in these two con-solidated proceedings. They are:

1. Texas Utilities Company ("TU"). TU is a public 1

utility holdine. com=.any which owns all, or more than 9 9 c. ercent, I

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l of the stock of Texas Electric Service Ccmpany ("TESCO"), Dallas Power & ~_ich Company ("DPL"), and Texas Power & Lich: Company 4

( " TP L" ) . These companies serve cus:0mers in 100 counties in the l ncrth cen:ral, eastern and western parts of Texas, including tne i

i Cities of Fort, Worth and Dallas , with a total population of more i

than four millien. The ccmbined generating capacity of the three i ope rating ecmpanies in 1977 was 14,919 megawatts.

2. Houston Lighting & Power Company ("ELP") . ELP is a

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vertically integrated electric utility serving the Texas Gulf

$ Coast region, including Hous:On , Galves ton and 151 smaller muni-l cipalities and communities. Its generating capacity in 1977 was 10,170 megawatts.

] 3. West Texas Utilities Company ("WTU") and Central 1

i Power and Licht Ccmpany (" CPL") . WTU and CPL are both public

utilities and both wholly-owned subsidiaries of Central and South Western Utilities Company ("CSW") , a public utility holding I company. WTU s erves 133,000 retail customers in central and southwest Texas; CPL serves 360,000 customers in a 4 4-county area w th a population of 1.2 million. Their combined generating capacity in 1977 was approximately 4,100 megawatts.

Unlike the other utilities, and most utilities throughout the nation, WTU has taken r,gecial pains to operate its electrical system in a non-integ:sted f ashion. One component, north, east and we s t of its Lake Pauline generating station, is intercon-nected with utilities operating in inters tate commerce . The other camponent, on the so u th , eas t and we s t , is interconne cted to TESCO and other intrastate-only Texas utilities. Although the ,

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two systems are interconnected , the interconnections are controlled to prevent electricity moving between the two compone nts .

Central Power & Light Commanv. CPL supplies 4.

electric service to a 44,000-square mile area 1/ in 44 counties of Sou:h Texas, a population of 1.3 million people, 2/ witn a

ansmission network of 2,573 line-miles. It is some 200 miles as the crow files from Brownsville through CPL to the nearest interconnection with another Texas utility (San Antonio) and some 300 miles to the nearest other Texas investor-owned utility (Houston Lighting and Power Company) . CPL's 1979 customers num-bered 4 23, .00 with e peak load of 2,433 .M w and sales of 12,720,125,000 Kwh. It is a subsid iary of CSW , a registered holding company operating in Texas , Louisiana, Oklahoma and ,

Arkansas. In 1979 CSW served 1,300,000 customers with coinciden-tal peak load of 7,800 Mw and sales of 43 billion Kwh. The C5W l

l electric service area encompasses 152,000 square miles 3/ and 3.7

- i million oeco.le. _4/

The City of

5. Brownsville (" pus ," "Brownsv ille" ) .

Brownsville, through its Puolic Utilities Board, owns and opera-tes a generation, transmission and distribution electric utility 1 and 1/ Larger than the State of Virginia (39,800 sq. miles)

Targer than 17 of the states.

2/ La rg e r than 15 o f the s tates .

3/ Larger than all states but Alaska , Texas and California .

4/ Larger than 27 of the states. .

_ g-sys tem in and ..around 3rownsville , Texas , having 23,000 customer connections and a 1979 peak load of 113,000 Kw. I:s gross energy icad was approximately 497,000,000 Kwh in 1979. It has a single l 1

69 Kv transmissicn interconnection with CPL through which it  ;

l centractuallv c.erchases firm power to the extent of the line's l

I capacity and serves the balance of its load from its own ganeration.

The City's load has been growing at a 6 % ccmpound annual rate. The capacity of the 6 9 KV interconnection is insufficient to provide for more than 40,000 Kw reliability at the time of summer peak, although City's needs, and CPL's contractual ligation, call for a larger purchase. For many y~.ars , CPL has refused to enlarge the capacity of interconne ction , thus causing

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brownouts and blackouts, and thereby inhibiting 3 cwnsville in ecmpeting with CPL for new loads and enabling CPL to take a large industrial cus:cmer frem Brownsville.1/ Moreover, Brownsville has been subjected for many years to continuing anticcmpetitive actions by CFL including refusals to wheel, exclusion from the Texas Intercornected System (" TIS") and the South Texas Interconnected System ("STIS"), buy-out ef forts , deprivation of 1/ The parties have now agreed to the construe icn of :wo 138 Kv Interconnections , but CPL tied in a 10-year take-or-pay purchase agreement as a condition for such agreement. The 138 Kv inter-connection will not be completed until 1981. ' CPL FERC rate schedule No . 6 2, eff ective April 4, 1980).

These interconnections , Brownsville's admission into STIS and TIS, and Brownsville 's recent arrangements with CPL to transmit o f f-peak interruptible *lectric energy from Texas Power & Light Company are the result of the pendency of the current proceeding.

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statutory pref erence power (which CFL obtained for itself though no: a preference customer) and e. clusion frem the South Texas I

Pro;ect. These actions have been to some extent alleviated due to the pendency of the instant proceedings but i: appears that CPL's everall anticompetitive program is continuing , including wha: appears to be a continuing objective of taking the PUB system ever.

CFL a torneys do not deny ( in responding to Brownsville 's

" Motion to Compel CP&L Responses to Interrogatories" of September 11, 1980) the fact of " secret communications " that appear to have taken place in 1980 between Company of ficials and scac of ficials at the City concerning CFL proposals to pu chase the PUB electric system, although they resist the Motion on other grounds.

III. TH" PROPOSED CONDITIONS AND RELATED SETTLEMENT AGREEMENTS T.E INCONSISTENT WITH THE ANTITRUST LAWS AND OTHERWISE UNLAWFUL, UNREASONA3LE, UNFAIR AND CONTRARY "O THE PUBLIC INTEREST.

In general, the proposed license condition permits the con-

inuation of agreements and unila:eral conduct whose sole purpose is to restrain . interstate commerce.

A. The Agreement Nc*, To Engage In Inters tate Comme rce Violates Sections 1 And 2 Of The Sherman Act And The Pattern Of Intras tate-onl-/ Interconnections Is Inconsistent With The Policies Of The Antitrust Laws.

1. The acreement.

Utilities comprising 50 percent of the generating capacity in Texas -- including the TU and CSW cperating companies,1/ ELP, i

1/ Unless the context indicates otherwise , ref erences to CPL Include only the intrastate component. -

and three public power agencies -- have since the inception of federal powe r regu13: ion in 1935 developed agreements to estaclish and =aintain interconnections only among themselves and no: to interconnect with any utility engaged in interstate commerce. Motivated by a desire to avoid being sub]ect to the J urisdiction of the Federal Energy Regulatory Commission (and oefore that, of the Federal Power Commission), their intent is to preven; any interstate power from passing over their transmission lines. Given the econcmics of electric transmiss ion , that precludes any interstate utility from providing service anywhere within the area served by the Texas intrastate utilities.

Whe:her or not interconnection is expressly ref erred to in various agreements , the common goal has been to prev 3nt any elec :icity in interstate commerce from moving over the companies' lines.

For example, TESCO and WTU, in entering into interconnections ,

1 with each other, " agree (d] that no power . . . tr ansmitted ... or

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received . . . by either party hereto is to be transmitted ... in i i

interstate commerce (and] that neither party will transmit any power or energy delivered to it hereunder beyond the limits of the State of Texas." TESCO Exhibit in WTU v . TESC(, inf ra ,

Article V at 5. By the physical nature of electricity, this precluded each company f cm interconnecting with any intersta:e u til ities . They agreed, as the district court found in West Texas Utilities Company v. Texas Electric Se,rvice Company, 470 F.Supp. 793, 808 (N . D. Texas 1979 ) , appeal pendine, No . 7 9-2 677,

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4 4 5:n Cir., that neither would in te rconnect in interstate commerce

. w :hou: the consent of the other. If consent were not given, the i

ccmpany desiring interstate interconnection would have to forego its intrastate interconnection.

Sub s eque n: agreements between or among each of the major i

interconnected utilities repeatedly reinforced and reiterated

this agreement not to interconnect with any utility engaged in interstate commerce. Thus LCRA and ELP agreed that each would

) " arrange its system and operations so that -- ' (al li powe r and energy to be supplied by either party herein on its energized

! network :o which (the other] is connected hereunder shall have f been generated and transmitted wholly within that State of Texas." Plaintif f Exhibit 165 in WTU v. TESCO, suora, at 28-29.

d 1

j TPL s imilarly required each of its customers for econemy energy i,

-- including LCRA, ELP, and TMPA -- not to engage in interstate

,I l

ansactions for any purpose. In a standard contract executed 4

wi::. each of these cus cmers, TPL and the customer "each ...

agreetil that it will not connect its f acilities or permit its i

f acilitiis to be connected through other parties ... to any j 4 1 I

other generation, transmission and/or distribution f acilities j having interstate connections." Le tte r , sep tembe r 25, 1978, Mike

]

5 pence (T?L) to W.P. Smith (CPL).

Thus, not only did LCRA, ELP, WTU, TP L , and TESCO bind them- 1 selves not te engage in interstate commerce, but they further agreed to band anyone else with whom they dealt not to engage in interstate commerce.

13 -

This long pa::ern of agreements among the utilities in TIS /ERCOT no: :o interconnect with any utility engaged in interstate ccmmerce was again reflected in the Participation Agreemen for the South Texas ?roject. A provision requiring each participant to construct and operate its system "in a manner which will not unreasonably af fect the operation of the electric systems of . . . the ether Participants" was based , according to HLP, en "the reasonable expectatien of each member of TIS ...

that the other Participants would continue to cperate in intras tate commerce," that is , not interconnect with any utility in interstate commerce. ELP Counterclaim, page 3, in WTU v.

TESCO.

Virtually every adjudicating body which has considered the existence of the TIS /ERCOT intrastate res triction has concluded that the utilities did agree among the=selves that none would intercennect with an interstate utility. Thus, the district court in West Texas Utilities Cem?any v. Texas Electric Service Com?any held that Section 8. 2 of the STP Participation Agreement j cons tituted a binding and judicially enforceable commitmant among .

l l

the signatories not to engage in interstate commerce. " (Alli of the parties in the STP j oined in the proj ect with the common intention of continuing to cperate on an intrastate basis as they had operated since 1935. Each member of the participation agreement could commence interstate operations (only] upon advance notice to the other members of STP and TIS. " 470 F.Supp.

, - 9

- 14 -

) a: 336 1/ The Securities and Exchange Commissien, in con-4 sidering CSW's compliance with the Public Utility Holding Company Act, noted that members of TIS had bound themselves and their 1

J wholesale cus:cmers not to engage in " direct or indirect ex chang e l of electric energy between TIS and generating and electric ceili-ties outside of the State of Texas." 2/ Again in Central Power &

Light Ccmpany v. Public Utility Commission of Texas, No .

A-77-CA-86 (~4.D. Te x . , Aus tin Div . 1978), the court noted that

, IRCOT was the product of " contractual agreements establishing

( it] as an intrastate system." The Fifth Circuit, on appeal, agreed. IRCOT " members are contractually bound to refrain from engaging in intersate transmissicn of power." CPL v. Texas PUC,

~

592 F.2d 234 (5th Cir. 1979). And the Texas PCC shnilarly held that TIS contained " contractual prohibitions against inters tate sales," and prohibited WTU from re-establishing interconnection i

of its inter- and intrastate systems until those contrac ual pro-hibitions were " finally ad]udicated to be void or voidable."

Houston Lighting & Power Company, Texas PUC , Docke t No . 14, Amended Final Order, July 11, 1977, at page 9.

1/ The court went on to say that there was no contract "which violated Section One of the Sherman Act ," not because there was not an agreement, bc because not every agreement is a Section one violation. _Id.

2/ Central and South West Corp., SEC Admin. Proc . File No . 3-4 9 51, T Notice of and Orcer for Hearing on Program for Compliance with Section 11(b) of the Public Utility Eoiding Company Act of 1935,"

January 30, 1976, at page 5.

15 -

F;nally, the TIS /ERCCO = embers themselves have acknowledged the fact. Thus, an HLP executive testified in the Texas PUC case

a: the Ccmpanies ' commitment to intras tate cpe ration "was , of course , reflected in the ERCOT agreement itself . . . wh ich pro-vided tha: all members of ERCOT would operate on an intrastate basis." It was also " established in the course of dealings bet-ween all of the systems in IRCOT and was a policy well :cr.own to all of those members." 1/ In the SEC case, Ceatral and South West Corp., TU said that WTU's creation of inters tate intercon-nections was "in violation of long-standing contracts and understandings with the other electric utilities in Texas." 2/

And WTU and CPL have predicated an entire antitrust case against TESCO and ELP on their common agreement to refrain from interstate ccmmerce. See 470 F.Supp. at 804-805, 817-818; and WTU's and CPL's Brief for Appellants in West Texas Utilities Ocmpany v. Texas Electric Service Company, No . 79-2 6 77, 5th Cir.,

which is pending.

2. The agreement constitutes an unreasonable restraint of trade in violation of Section 1.

a. Per se unreasonableness.

The Shernan Act by its te=us broadly proscribes all agreements wnich restrain trade. Section 1, 15 U.S.C. 51. The 1/ Testimony of Mr. Simmons of ELP in Houston Lighting & Power Company, supra, Tr. 663-664.

2/ TU Motion and Memorandum, January 7,1977, at page 5, in 3entral and South West Corp. [WTU 3r. at 45 1

4 a

s

.t.

j cour:s have pe rforce given that broad proscription concrete .

l meaning in case-by-case applications , first narrowing the statute to agreements which impose unreasonable res traints , Standard oil Co. of New Jersey v. United States, 221 U.S. 1, 59-62 (1911);

1 Chicago Board of Trade v. United States, 246 U.S. 231, 238 2

i j

(1915), later firming up that prohibition by determining that I

l some kinds of agres=ents -- most notably those fixing prices or allocating narkets -- are so obviously anticompetitive that no J

acceptable econcmic justification could be offered fo r them .

I i United States v. Trenton Potteries Co., 273 U.S. 392, 397-398

]. (1927); United States v. Secony-vacuum oil Co. , 310 U.S. 150, 226 i

j 1

n.59 (1940); United S tates v. Topco Associates , Inc. , 405 U.S.  :

596 (1972); see National Society of Professional Engineers v.

United States, 435 U.S. 679, 692 (1978) (summariting the law) .

Once the agreement and its purpose is established , the violation i is made cut; there are no economic or policy defenses.

I

Determining whether the agreement fits within a certain cate- l 4

a t gory is not simple , and per _s_e analysis is not limited only to j agreements on simple and simply identified facts.

Even sui i

generis agreements may be held illegal .o_e_r_ _se if on analysis they nonetheless f all within one of the proscribed categories because

they seek a proscribed goal and are reasonably designed to reacs 1 i

i that goal. United S tates v. Container Corp. of America, 393 U.S. l 333, 334 (1969) ("unlike any other price [-fixing] decisions we 4

1

have rendered") . 1/

Agreements dividing or excluding competitors from geographic or product markets are among the ma or categories of per se v iola tions . Market divisions are most commonly achieved by con-sensual agreement among the competitors. They have been repeatedly struck down as per se violations. Topco Associates, supra, quoted with approval in Continental T.V. , Inc. v. GTE Sylvania, Inc., 433 U.S. 36, 57-58 nn.27 and 23 (1977); United States v. Sealy, Inc., 388 U.S. 350, 357-358 (1967); Timken Roller searing Co. v. United States, 341 U.S. 593, 598 (1951),

Addyston Pipe & S teel Co. v. United States ,175 U.S. 211, 240-241 (1399). The exclusion of competitors frem a market, which has many of the same structural anticempetitive ef fects as a market division, can also be achieved by consent among some competitors to exclude others; this is mos commonly done by coercion through another level of trade , e.g. , where distributors or retailers induce or coerce manufacturers not to deal with their ( the d is tribu tors ' or retailers' ) compe titor . See, e.g., United Sta:es v. General Motors Corp., 384 U.S. 127, 144-145 (1966);

United States v. Hilton Hotels Corp. , 467 F.2d 1000 (9th Cir.

1972), cert. denied, 409 U.S. 1125 (1973); Bowen v. New York i News, Inc., 5 22 F.2d 124 2, 1256-1257 (3d Cir. 1975), cert.

1 1/ For similarly unique per se price-fixing decisions , se?,

i e.g., Plymouth Dealers' Ass'n 3f Northern California v. United  ;

S tates , 27 9 F .2d 128 (9:n Car.19 60 ); United States v. Gasoline I Retailers Ass'n, 255 F.2d 688 (7 th Cir.19 61); United S tates v.

Nationwide Trailer Rental Systems, Inc., 156 F.Supp. 800 (O.Kan.), a f f ' c pe r _c_u.r iam , 355 U.S. 10 (1957). 1 1

. i I

1

18 -

denied, 425 U.S. 936 (1976); see also Fashion Cricinators' Guild

. . .: ~. , . _3 _, n. . = . ,. --2 , ( .3 e. 4_ ) . .$/

The technological and economic characteristics of the electric utility industry give electric utilities unique ability to exclude competitors. In general, the economics of the

ansmission of bulk power preclude the construction of a second

]

I transmissicn line to serve an area where transmissien service is I

already available. Electric utilities have frequently used their power ever transmission to protect themselves from competition.

! See, e.e. , Otter Tail Power Co. v. United States, 410 U.S. 366, 377-379 (1973). That power can be further supplemented where all u tilities in proximity agree to withhold their transmission ser-vice to a select group of competitors. The greater the transmission distance , the greater the power of the utility which  !

i owns the transmission lines. Thus, the members of a group cf utilities can further insulate themselves frem ccmpetition and l supplement their individual power to exclude competitors by agreeing among themselves to withhold their transmission service from all competitors who are not in en the agreement.

1/ Sectica 1 reaches cnly agreements , while Section 2 proscribes unilateral refusals to deal by monopolists. Lorain Journal Co.

v. United S tates , 3 42 U.S. 143, 152-155 (1951). Section 5 of the FTC Ac t , designed to reach trade restraints in their incipiency, gces beyond either and proscribes unilateral exclusions of C0mpe titors , even absent monopoly power, because of their boycott-like effects. Tvsons Corner Regional Shcoci._ Center, 85 FTC 970, modified, 36 FTC 921 (1975).

)

19 -

The very purpose of the T:5/ERCo; ag reement was not merely to i restrain, but absolutely to eliminate interstate trade in the 1

i area. The unique econcmic charac: eristics of electric i transmission assured the success of their agreement. There can j te no dispute that, except when the agreement was breached by j

CSW, i succeeded pe rf ectly in eliminating all interstate com-i j merce in the greater part of Texas , that covered by the utilities 1

4 a

conspiring within TIS and IRCOT. None of the members of i

j TIS /ERCOT could have succeeded at exclud ing interstate commerce i

i without the agreement and cooperation of others. Each would have been comoelled by the need for reliability to interconnect with c:her utilities . They could all succeed in perpetually excluding all interstate utilities only by cooperation and agreement among i themselves. This, as the discussica above of the agreement 4

shows, they most certainly did.

The members of CTS /ERCOT thus succeeded , as they sought to do, in eliminating competition in their geographic area from out-of-state and interstate utilities . They were not required, as manuf acturers normally would' be, to operate through vertically related distributors to coerce non-conspiring competitors to stay out of their marke t. Cf. Fashion Originators' Guild, supra. Nor 1

were they required to come to agreements with the competitors they sought Oc exclude, which typically occurs when individuals or even groups of competitors lack the power to exclude others.

Cf. Addysten Pipe & Steel Co. , supra; United States v.

l Consolidated Packaging Co. , 575 F.2d 117, 125 (7 th Cir. 19 78 ) .

O l

i 20 -

They did no: have to so operate because collectively they enjoyed the power to exclude wi:hout bringing others -- their own suppliers or distributors or other hori: ental competitors -- into the conspiracy. Thus, they combined their poucr in their respec-

! tive areas to insure that no out-of-state or inters tate utility t

could ef f ectively penetrate anywhere within their area. Absent agreement, they too would have lacked the power to exclude all interstate u:ilities, since the economics of electricity transmission would have required each of them to interconnect with others.

Absent this agreement, some interstate connection was likely, 1 i

even certain. Brownsville would not have to establish the cer-tainty of this competition in an antitrust case. Standard oil Co. of California v. United States, 3 37 U.S. 293, 309-311 (1949);

see also National Society of Professional Engineers, 435 U.S. at l l

I 692 (assumption respecting normal competition absent competitors' I agreement not to compe te ) ; Associated Press v. United States, 3 26 U.S. 1, 13-14 (1945) (same); United States v. Colgate & Co., 250 U.S. 300, 307 (1919). The TIS /ERCOT members , having agreed to 1

eliminate interstate utility competition entirely, can hardly oe heard to complain that victims of the conspiracy should be denied relief because they cannot now establish with certainty the exact degree to which trade was restrained.

b. Unreasonableness under the Rule of Reason.

The tes for agreements res training trade which do not fall within any Of the well-recogni:ed categories of cer se illegali ty ,

i l

• s wne:her their ne: economic effect is to restrain or promote ecmpe :ition . The test, first enuciated by Justice Brandeis in 1913, "is wnether the res::aint imposed is such as merely reg u-la es and perhaps thereby promotes competition or whether it is such as may suppress or even destroy competition." Chicaco Board of Trade v. United States, 246 U.S. 231, 238 (1918). This tes has been reiterated many times , most recently in Continental T.V., Inc., 433 U.S. at 4 9 n .15, and National Society of Professional Encineers v. United States, 435 U.S. 679, 691 (1973). In the latter case , the Court emphatically rej ected thc contentien that anticcmpetitive restraints could be justified on grounds of policy or innocent intent. "(T]he purpose of the analysis (under the Rule of Reason] is to form a judgment about i

the ecmpetitive significance of the restraint; it is not to decide whether a policy favoring competition is in the public interest, or in the interest of the members of an industry.

(T]ha

policy decision has been made by Congress." 435 U.S. at 692. The Court accordingly rej ected as irrelevant as a matter of law the def ense of a professional association's rule prohibiting certain forms of price competition that ecmpetition would result in inf erior work, and that the public's interest in safe cons truction of large-scale proj ects af f ecting the public saf ety Justified the res traint. Such an exception, the Court said, "would be tantamount to a repeal of the statute." Id. at 6 9 5.

I is no: the Court's role to " conf er(] monopoly privileges on the manufacturers." Id. at 696.

l

The :es , then, s whether :he ne: effect of the res:raint is

eliminate or restrain ecmpetition. The only defer.se to a showing of anticcmpetitive ef fects is the response that there are even greater pro-ecmpetitive ef fects. Aosent a showing that an anticempe titive ef f ec: is " offset by a need to achieve a pro-ccmpe titive benefit or justification," the restraint is illeg al .

Kestenbat= v. Falstaff Brewing Co., 575 F.2d 564, 571 (5th Cir.

1973), citing United S tates v. Arnold, Schwinn & Co. , 388 U.S.

365, 380-382 (1967). Even a showing of the prospe ct of product de:erioration is inadequate as a def ense absent a showing tha:

there are no other less res:rictive means to achieve that goal Copper Licuor, Inc. v. Adolph Coors Co., 506 F.2d 934, 944-945 (5th Cir. 1975).

The first place to look in assessing the effect and signifi-cance of a restraint is to the intent of the parties, "not because a good intention will save an otherwise objectionable regulation or the reverse, but because knowledge of intent may help the ccur to interpret f acts and to predict cons eque nce s . "

Chicago Soard of Trade v. United States, 246 U.S. 231, 238 (1915). Here, the parties' intent -- as opposed to their mo tiv a-tion -- was to prevent the introduction of interstate electric power into : heir collective area. Tc be sur e , their motivation was to avoid regulation, not competition,1/ but the means they 1/ This, sco , had its anticcmpetitive aspe cts. Among their reasons for avoiding federal jurisdiction was the desire to avoid being compelled to connect "with competitive Government projects."

t chose necessarily avoided occh. Tneir =ocivation shaped their

, c. o al , wn ich wa s : prevent the introduction of powe r frem cut-of-s ta:e er interstate utilities frca being introduced into their 4

ansmission lines, and their goal shaped the intended result,

, the exclusion cf interstate power from their geographical area.

4 j Again, given the economics of electric transmission, their 4 a3 reement not to carry interstate electriciev. constituted an agreemen that necessarily excluded interstate utilities from

! providing any electric service in the TIS /ERCOT area.

The anticompetitive ef f ects of this agreement are plain , and the utilities cannot seriously dispute it. In addition to precluding all competition frem interstate utilities, the

, ac. reement also stultifies com & cition within the conso. iraev for bulk finn power because of the uncertainty it imposes on bulk

! transactions between utilities interconnected through another j u t il i ty . The latter may disconnect frem all others on a few 1

mcments' notice, as occurred af ter the midnight wiring in 1976; i

j with that prospect hanging in the air, long-term transactions are j virtually impossible .

1

! There are no countervailing pro-ccmpetitive ef f ects. Kesen

those , and given the utilities ' unequivocal intent to restrain interstate trade, analysis under the Rule of Reason ccmpels the conclusion that the agreement rs to interconnect in interstate commerce restrains trade ii viol ;ien cf Section 1 of the Sher =an Act.

.

• j l

3. The agreement constitutes a conspiracy to I monopoli

e in violation of Section 2.

t Section 2 of the Sherman Act prohibits conspiracies to monopoli:e , as well as monopoli:ation itself and attempts to l

sonopelize. 15 U.S.C. 52. An agreement constitutes a conspiracy to monopoli:e where the parties specifically intend to obtain menopoly power and take some af fi==ative step toward that illegal goal. Detailed proof of the specific market or the likelihood of success is unnecessarv.- ,

i A conspiracy to monopoli e is made out where a group of com-petitors agree to exclude competitors and to share all business among themselves. The power to exclude caspetitors is one of the two hallmarks of monopoly power. United States v. Grinnell Corp., 384 U.S. 563, 570-571 (1966); United States v. DuPont &

Co . , 3 51 U. S . 377, 391 (1956); American Tobacco Co. v. United States, 328 U.S. 781, 793, 809-815 (1946).

1 No one conspirator need have monopoly power itself, so long j i

as the group aspires to have such power cbilectively. Tha  !

censpiracy to monopolize found in American Tobacco Co. v. United ,

1 1

States, 328 U.S. 781, 809-815 (1946), was of this type. And the  ;

Second Circuit upheld convictions of a similar conspiracy to acnopolize where a group of competitors allocated "old" cus tomers ,

l among themselves and jointly ~took steps to prevent any non-l conspiring competitors from obtaining their business. United )

States v. Consolidated Launderies Corp., 291 F. 2d 5 6 3, 5 6 7-5 68, )

1 572-573 (2d Cir. 1961). For other descriptions of sufficient )

i

allega ions of conspiracies to monopoli:e , see Continental Ore Co.

v. Union Carcide & Carbon Corp., 370 U.S. 690, 708-709 (1962);

s ewis v. Pennincton, 400 F.2d 506, 311-514 (6th Cir. 1968); Giant Paper & Film Coro. v. Albemarle Paper Co., 430 F.Supp. 981, 957 (S.D.N.Y. 1977); and United States v. General Motors Corp. , 369 F.Supp. 1306, 1307-1308 (E.D.Mich. 1974).

The agreement no to interconnect with interstate utilities consti:utes a conspiracy to monopoli:e by excluding ccmpetitors.

4. Intras tate-only interconnections are inconsistent with the policies of the antitrust laws.

The most fundamental purpose of the Federal antitrust laws is the prcmotion of commercial competition free from private restraints imposed by agreements not to compete or by single firms possessing significant market or monopoly power. The antitrust laws expressly prohibit anticompetitive agreements and the possession or exercise of monopoly power in many situations . ,

but, at the same time , it is well-recognized that there are many interstices within the Sherman and Clayton Acts where their spe-cific prohCaitions f ail to prevent private conduct that is flatly contrary to the policies and purposes of the Acts.

To take only the most well-known examples, Section 2 of the Sherman Act prohibits monopoli ation and attempted monopoli:a-tion; the former reaches the successful acquisition of monopoly I power, the latter, the attempt to achieve it by anticompetitive or exclusionary means. Where a firm uses exclusionary means to pro-

l

)

I and main:ain a less-than-monopoly market share , howeve r ,

ect

neither provision applies. Thus , a leading firm that disciplined i

j price-cutting competitors with n.e specific intent to protect its j 40 percent market share, but not to increase it to monopoly levels , was immune to Sherman Act sanctions. United States v.

Empire Gas Co. , 5 37 F .2d 2 96, 30 2 (8th Cir. 1976), cert. denied, 429 U.S. 1122 (1977), discussed in National Commission for the i

Review of Antitrust Laws and Procedures, Report to the Presiden and the Attorney General, at 144-149 (1979). Similarly, Section 2 does no reach persistent oligopoly power, where a small number I

of firms centinue to enjoy subsrancial but less-than-monopoly i power for long periods of tine, even though such fi=ns con-

~~

sistently perform less efficiently than would -firms in a truly ccmpe titive market. But uncompetitive, consciously parallel con-due : among oligopolists, although it has the same eff ect en com-petition as express agreement, does not f all within the ban of j Section 1.

The pattern of interconnections which keeps the Texas utili-l ties interconnected only with eact. other and which keeps them

(

unconnected from all out-of-state and interstate utilities is fla:1y centrary to the essential policies of the antitrust laws in two wavs :

l First, a significant degree of competitien in the bulk power marke for all kinds of fica and non-firm power and for econcmy energy is subs tantially eliminated . No generating or distri-buting utility within TIS /ERCOT can purchase any power or energy I

i 1

~

1 4

e.i_

from any non-Texas intrastate utility. The Texas utilities in l IRCCT, compris ing approximately 28,500 Mw load , are thus insu-la ed from competition from the sur:cunding e* stems, which comprise more than 3 9,000 Mw.

i

{

1 Second, a significant degree of competition in the bulk power I

market for fima power among Texas utilities is also eliminated .

Firm power requires that the purchasing company be substantially assured of its availability. But each major utility system's con tinuine. declaration of a .coliev. to disconnect from any

. utiliev.

which interconnects in interstate commerce makes firm power trans-actions through any such interconnection uncertain.

i S. The ? oposed License Conditions Fail To Cure A Situation Flatly Inconsistent With The Antitrust Laws.

1. The standard.

I section 105 of the Atomic Energy Act imposes upon the Commission a broad mandate to protect against private restraints on free competition db.at might be aff ected bv* the use of atanic l a

4 I

, energy. Where an actual antitrust violation has occurred , the i 1

Commission is directed to consider whether revocation of a license or some lasser sanction is appropriate. Section 105(a),  ;

1 1

42 U.S.C. 52135(a). Where the Commission learns of conduct l 1

"which appears to violate or to tend toward the violation of" the 1

antitrus: laws, including Section 5 of the ?"C Ac t , 15 U.S.C.

545, c: which tends "to restric: free campetition in private e nte rpris e ," it is required to transmi- that information to the I 6

-,r ---

A::czne y Ge ne ral . Section 105('c), 42 U.S.C. 52135(b). And when-ever a license is sought frem the Ccamission , it must de te rmine whe:her the preposed licensed activities "would create er main-tain a situation inconsistent with the antitrust laws," including Sections 1 and 2 of the Sherman Act, Sections 2, 3, 7 and 8 of the Clay:On Act, and Section 5 of the PrC Act, 15 U.S.C. SS1, 2, 3a, 24, as, _3 2, and 4:.

The Ccamission's duty thus clearly goes beyond ascertaining whether an cutright violation has occurred or is likely to occur as a result of gran of a license, although the finding of such a violation would , standing alone , constitute a basis for rej ecting the license application. Rather, like the Federal Trade Commission under Section 5 of its organic act, 15 U.S.C. 545, NRC is mandated to " nip in the bud any incipient antitrust s ituation," Report of the Joint Committee en Atcmic Energy, S.Rept. 91-1247, 91s t Cong . , 2d Sess. (1970 ) at page 14, borrowing the f amous phrase frcm FTC v . Raladam Co., 28 3 U.S.

643, 647 (1931), and reflecting the common purpose "to advance the public interest by securing fair opportunity for the play of the centending forces ordinarily engendered by an hones desire for gain," id. NRC's duty is to search not only for outright antitrust violations, but for situations "incons is tent with any of the antitrust laws er the policies clearly underlying these j laws . " S . Re p t. 91-1247, at page 14. Indeed, Congress' de cis ion l

include the bread-ranging Section 5 of the FTC Act within URC's enforcement ambi was caref ully considered and its inten:

1

--_n--- .--

ha* s .d f rely on ??C Jurisprudence is " scarcely debatacle."

Consume r: Power Co. (. Midland Plan:, Units 1 and 2 ), ALAS-452, 6 NRC 592, 910 (1977), and see 909-912 generally; see also Kansas Gas & Electric Co. v. Kansas City Power & Licht Co. (*4o;f Creek Generating S:ation, Uni: No . 1 ) , NRCI 75/6, at page 5 5 9, 571-573

( ALA3 279 ) (1975). Section 5 reaches conduct inconsis tent wi th the policies of the Sherman and Clayton Ac:s , though a i " full-blown violation" has not occurred. Consumers Power, 6 NRC a: 911. See FTC v. Sperry & Hutchinson Co., 405 U.S. 233, 244 n.5 (1972); FTC v. Texaco Inc., 393 U.S. 223, 228-229 (1968); FTC

v. Brown Shoe Co. , 384 U.S. 316, 320-322 (1966); Atlantic Refining Co. v. FTC, 381 U.S. 357, 369-371 (1965). Section 4

, 105(c) uses the same purposes and standards. Id. at 912.

2. The inadecuacy of the license conditions.

l The proposed license conditions utterly fail to cure the essential anticompetitive situation in the Texas electric indus:ry: interstate competition continues to be walled out by mutual consent and each large generating utility en3cys con-tinued shielding from intrastate competition for firm power by reason of the uncertainty of inter-utility interconnections . The u til i:ies ' operation of the proposed nuclear plants will further entrench these anticcmpetitive ef f ects ,

a. No new substantive duty is imposed on HLP respecting interstate interconnection.

First and foremost, the proposed license cenditions impos e absolately no new enforceable duty on HLP to pe=:it interstate interconnections : hat does not already exist. No sooner does one -

i

hand impcse the "cenditien" unan the other undercuts it ey pro-viding only the postponed remedy which Congress intended to pro-vide in this case. The recitation of the duty to permit inter-connection in Section I.3.6. ( a) is cuickly followed by tha provi-sien tha ELP 's violation of that duty shall only be "sub3ect to review by the NRC . . . to deter =ine whether any such ref usal would create or maintain a situation inconsistent with the antitrust laws [under] the standards set forth in Section 105 ... .

By providing for a future proceeding under Section 105 s tandards ,

the prevision impliedly precludes a proceeding under Section 136(a), 4 2 U.S.C. 5223 6 (a) , to enforce by revocation the duty to permit interconnection in interstate commerce.

Absent such enforcement rig hts , the apparent duty to inter-connect is ephemeral . And if the duty is ephemeral, this con-dicien cannot cure the situation inconsistent with the antitrust laws. That cure , based on a finding of inconsistency, is sup-po s ed to be provided in this case. By permitting HLP to ref use to interconnect subject only to a future determination of antitrust policy inconsistency, this putative condition merely pos tpones the decision.

Moreover, by pos tponement, it also further weakens the remedy. First, the impediments to seeking interstate intercon-nections are so grea: -- as the discussion below will indicate --

that it is unlikely any utility will ever seek to invoke its ,

1 l

rights unde r these license conditions . Thus, just as tax def erral can become tax saving s , so postponement here becomes .

l l

denial, as a practical matter, of the relief to which Brownsville s entitled . Second, the license condition imposes new impedi-ments in a subsequent proceeding to determine antitrust in<_ans is te ncy. Thus, the recitation in Section I.3.(6 )(b) that ELP shall forego the agreement upon which it has relied for 4 5 years , although it is no more ef fective than a sham in discon-tinuing the ef fects of that long-established way of dealing among the Texas utilities , will provide ELP with the argument that the s ituatica inconsistent with the antitrust laws has already been cured. That is nonsense, of course, but the availability of even i

such spurious arguments will impede further proceedings. Third, )

che license condition itself prohibits only disconnections or refusals to interconne ct "by reason of the interstate character l of such (interconnected] facilities," and the subsequent pro-ceeding cader Section 105 s tandards is limited to "such refu-sals." 1/ Thus, ELP will have available as a defense in the suo-sequen proceeding that its refusal was based on any of a great hos: of other reasons, which it has in the past produced with remarkaole facility.

This " condition" thus has no bite and does not operate as license conditions are meant to cperate , that is , Oc def ine and compel that conduct necessary to cure an inconsistency with the

_1/ Thus, ELP may also ar~ue v that this remedy does not apply to disconnections , which are ref erred to in the dis]unctive with refusals in the first clause of Section I.3. ( 6 )( a) , nor to

" pr ev e nt ion" by means other than refusals to interconnect, wh ich are covered by the second long clause before the proviso . .

l l

. ~

32 -

an ti

rus laws and their underlying policies . Rather, this is but a loophole through which ELP is to slide now while the

., existing anticompe titive arrangement continues, una=4:ed,

~

4 unrestricted and , worse , with the appearanc' of NRC's imprimatur .

i Finallv, such duty as is inposed is limited to the perfor-I 1 mance of duties in.cosed bv the license conditions , not the I antitrust laws generally, and these duties are limited either substantively 1/ or =rocedurally. 2/ - -

4

b. Such right as is creaLId is subject to l severelv burdensome procedural impediments.

i To the extent ELP's duty to interconnect interstate gives i

Brownsville and other utilities any rights -- not ve ry great, as j the foregoing point established -- they nre burdened with a severe precedural imped iment . Before ELP 's duty even ariris , a i utility seeking interstate service must apply for and make best ef forts to obtain an interconnection or wheeling order from FERC i under the Public Utility Regulatory Policies Act of 1978. This 4

turns what Congress intended as an additional protection supple-menting the antitrust laws into a burden, and a not incon-siderable ene. The extensive factual showing is sketched out in i

obligations on the utility seeking wheeling ,Section I.3.( 3 )(i)-

i

( iii) , providing HLP with yet another line of def ense to a refu-sal to interconnect under these license conditions .

1/ The broad duty to provide transmission for Brownsville is Iimited to deliverv. of powe r from S T? . Section I.3.(1)(b) and

(c).

l 2/ The general wheeling obligation is replete with provisos and ocligations on the u:ility seeking wheeling ,Section I.3.(3)(i)-

( iii) , providing ELP with ye t another line of def ense to a ref u- .

i sal to interconnect under these license conditions.

l l

l_ _ __ _ _

he margin. * / Moreover, ELP remains free to oppose a FERC order under ?URPA on any grounds so long as they are not patently frivolous. Given the many substantive and procedural imped iments under ?URPA (see the previous footnote), ELP 's obligation to pay litigation cos ts only if FERC relies on a ground not put into issue by ELP is ephemeral. 2/

c. The conditions do not undo the entrenched ef fects of 45 years of agreement to restrain trade.

The formal recitation in the license conditicn that ELP will not maintain "any agree.nent or understanding with another 1/ To obtain either a wheeling or interconnection order, the iroponent must establish that the order is (1) in the public interest, (2) must not impose uncompensated economic losses on the utility sub]ect to the order, ( 3 ) will not place an undue burden on it, (4) will not unreas.onably impair its reliability or (5) its ability to se:ve its customers. Sections 210(c)(1) and 212 ( a) (1 )- (4 ) , 16 U.S.C. 5 58241( c) (1) and 8 24k( a)(1)-(4 ) . To

-b ain an interconnection ordet, the proponent must also show cha: the order would either (1) encourage overall conservation of energy or capital, ( 2) optimize efficient use of resources and facilities, or (3) improve the utility's reliability. Section 210(c)(2)(A)-(C), 16 U.S.C. 58241(c)(2)(A)-(C). To obtain a a wheeling order, the proponent must also show that the order would either (1) conserve energy significantly, ( 2) significantly pro-mote efficient use of facilities and resources, or (3 ) improve the utility's reliability. In addition , the wheeling order pro-pcnen must also establish that the order would " reasonably pre-serv e existing compe titive relationships ." Sections 211(a)( 2 )( A)-(C) and ( c) (1) . This list does not exhaus t all of the elements which the order proponent must es tablish . See Section: 211(c)(2) -(4) and 212(b), 16 U.S.C. 5824j(c)(2)-(4) and 324k(b).

2/ I also 2carantees that ELP will raise every conceivable subs tantive point in opposition to a FERC order to avoid being saddled with those costs , thus further encouraging ELP -- a s if further encouragement were needed -- to oppose interconnection vigorously before TERC as in every other forum.

i

,.-y- - - - , . - - - . -

34 -

(2:ili:y] to ref use :o deal with any other (utilicyl with the purpose of =aintaining an exemption from jurisdiction under :ne Federal P:wer Act" is , to be blun , pathetic.

First, the prevision only applies to agreements between ELP and another utility to ref use to deal with a third party. ELP remains free to agree with any utility that it will disconnect f rca it if it establishes any interstate connections or goes into interstate commerce by reason of anyone else's interconnection, while leaving the disconnected utili:y free to deal with the interstate utility. All that this provision requires is that ELP not agree with another utility not to deal with an interstate  ;

utility under any circumstances. But ELP can continue to require every utility with which it is directly connected to agree not to interconnect in interstate ccmmerce on pain of immediate discon-1 nectica by HLP. 1/ That is exactly the agreement that exists now 1 that violates Sections 1 and 2 of the Sherman Act, and a fortiori -

)

i See ion 5 of the FTC Act. At best, it requires ELP :o replace l its floating multi-lateral agreement with a series of bilateral agreements. The substantive dif ference between the two is nil. 2/

1/ If this reading sounds strange, it should at least be Tamiliar: it is exactly the position adopted by the district court in

• des Texas Utilities v. Texas Electric Service Co. in ruling in f avor of TESCO and HLP respecting the meaning of refu-s el s to de al . See 470 F.Supp. at 815-818.

_2/

The analoc_ous =.rovisicn in the Comanche license condition, Section C.2.(1)(b). is even more carefullv draf ted to avoid i interf ering with any of the established agreements to preven:

inte rs tate commerce . First, by its terms it applies only to .

l

15 -

d Second, the provision applies only to agreements "with the

purpose of maintaining an exemption from jc-isdiction under the Fede ral Powe r Ac t . " Bu t there is no question anywhere in any of these related proceedings involving the Texas utilities o# an exe=otion under the Power Act. An exemption is an exclusion from J urisdiction otherwise created by a positive grant of reg ulatory

! or other authority. 1/ Eere, the issue is one of whether there i

is a positive grant of regulatory authority, that is , whether the Texas utilities are in interstate commerce , the trigger for FERC

jurisdiction, not of an exemption from jurisdiction which is af firmatively granted. 2/ We doubt this difference was lost on the experienced utili

y lawyers who draf ted these license i

conditions. If read restrictively','then, this provision would j acreements between the " applicants (and] other Entity ( ies)"

( emphasis added) , and thus not to agreements among the applicants and their operating companies , so they may continue to bind each other not to deal with a third utility which is in interstate

] commerce. That is the agreement which the district court j enforced in WTU v. TESCO, 470 F.Supp at 833-835. As with the

STP condition, it applies only to agreements to refuse to deal with a third utility, so that agreements conditioning intercon-nection on lack of inters tate connection, as allowed in WTU v.

TESCO, would also still be pe rmitted.

l 1/ See, e.e., Section 414 of the Federal Aviation Act, 49 U.S.C.

51384; Section 221 of the Communications Act, 47 U.S.C. 5221; and See: ion 1 of the Capper-Volstead Act and Section 2 (b) of the McCarran-Ferguson Act, creating exemptions from the federal antitrus t laws , 7 U.S.C. S291 and 15 U.S.C. 51012(b).

2/ The dif f erence is properly acknowledged in one provision of the proposed Comanche license conditions (Section D. 2. (1)( a) ref ers to connections "which could af f ect the nonj urisdIctional status of" the applicants) , although Section D. 2. (1)(b) , which is analogous to this provision, similarly ref ers to "an exemption from jurisdiction."

1

l i

l not even apply to ag reements to ref use to deal to maintain HLP 's acn3 crisdictional status , which are the very agreements in que s tion .

The last clause adds nothing significant to this meager p chibition. It merely requires that EL. not telephone anyone else before deciding to enforce an agreement to disconne:: a util-i:y which interconnects with an interstate utility.

Tne significance of this provision must be judged within the context in which it is impos ed . Even if it did reach agreements conditioning intrastate ccnnection on the absence of interstate interconnections -- which it does not -- ELP and the other Texas l

1 utilities have maintained and enforced agreements not to engage  !

1 in interstate commerce for the better part of five desnies. They have developed sharp, well-defined understandings among them-selves respecting what is and what is not pe rmitted through long years of mutual planning . Given the small number of firms in the market, agreement is no longer necessary to achieve the forbidden anticompe titive ef f ect.

In any event, this provision does not reach ELP 's on-going agreements not to interconnect in interstate commerce. It f ails to reach ELP 's or any other utilities ' agreements pem:itting other utilities to interconnect with the intrastate system only so long as they do not make any interstate connections . By pe r-

, mitting such agreements and by permitting HLP 's and other utilities' unilateral decisions to disconnect, it insures that the Texas utilities system will remain segmented from all

i . . ,

i interstate markets t 3, even worse , that trade in firm power in the intrasta e markte will be impeded by the cons tant ove rhang ing threat of disconnection like that which occurred following C5W's 4

=idnig ht wiring in 1976.

4 1

These markets are artificially segmented as a direct resul:

of long-standing agreements among the Texas utilities. The i

i segmentation is artificial in the sense that neither tech-1 nological nor economic factors need interf ere with competition i

I between utilities in Texas and those in interstate ccamerce . The 1 only impediment is the actions -- some joint, some unilateral --

f I

of the Texas utilities which absolutely prevent any interstate t

4 i

commerce.

1 4 Such artificial market segmentation is flatly contrary to the

. policies of the antitrust laws , wb! ch favor free , unhindered com-peti ica as the best means for allocatir.g national resources and protecting consumers' interests in low prices and top quality l goods and services. Congress made the choice .for competition; the Texas utilities arrogate power to themselves and directly i

1 con::avene this fundamental national policy through both their concerted and unilateral decisions to thwart competition in their i

industry in this geographic area.

By permitting both unilateral and bilateral decisions to disconnect, the proposed license conditions singly f ail to cure this noncompetitive situation. At most, they postpone the cure to another Lme. Worse , to the extent that the threat of NRC action induced some of the utilities to relax somewhat their l

i m . _ , _ _ . - . - _

, . l 4

c

her anticcmpetitive practices , NRC's approval of this settle-j men removes such constraint as there was on the utilities ' prac-I tices and will c.ive the acc.earance of of ficial imprimatur for the l

1 j blatantly anticompetitive e nduct and crac :ces not eronibited.

I ,

1

3. The DC asynchronous interconnection does not cure the situation inconsistent with the antitrust lass.

l Tne proposed DC interconnection between the interstate and 1

l intrastate segments of CPL are woefully inadequate, both because

! of the inherent limitations on DC as opposed to AC interconnec-4 I

1 tien and because those =odest interconnections will introduce a k

most a miniscule amount of interstate canpetition into the intrastate Texas market.

j The econcaic and competitive advantages of AC lines over DC

! lines are many. AC lines are much less expensive to build per j unit of megawatt capacity; the introduction of AC lines now would pe rmit incremental additions of more low capacity, low cos: AC i

1 lines in the future as demand justifies them, a: lower cos t and i

with minimal coordination ecmpared to DC lines; the relianca cr.

DC l ines now, precluding the econemical incremental introduction of additional AC lines in the future , will require expens ive , cir-c .:cus and inefficient wr.aeling arrangements to move powe r be-tween relatively close origins and destinations; and AC lines require much less coordination than DC lines for scheduling te:as-actions over them, providing greater ef fective capacity and flexibility in interstate transactions.

l

.Mo re ov e r , the two DC lines are under the control of CSN and are committed primarily to serving power exchanges for CSN s ubs id iarie s . In addition to the many competitive def ects noted abcVe, the limited re=aining capacity available for providing transmission service cetween the Texas utilities and inters tate utilities is insignifican: --

less than 1 percent -- compared to either the amount of power with which 1: will compete within IRCOT or the amount of power which would be introduced into Texas if the interstate barrier were remeved by effective license conditions.

Because : hey introduce virtually no new competition' into the intrastate Texas area , these DC lines will simply have no ef fect on the existing noncompetitive situation.1/

CONCLUSION The proposed license conditions are inadequate to cure the situa:Lon inconsistent with the antitrust laws. The proposed conditions should be rejected , and more pa riasive conditions 1/ It is difficult to take seriously the Justice Department's hair-splitting between the anticompetitive ef fects of relying on DC rather than AC interconnections under the puolic interest standard of the Federal Power Act, and the purportedly pro-c ompe titive result in relying only en DC rather than AC intercon-nections to cure the situation inconsistent with the antitrus laws under the public interest standard of the Atomic Ene rgy Act.

See City of Statesville v. AEC, 441 F.2d 962,_ 986-983 (D.C.

Cir. 1969) (en canc).(Leventhal, J., concurring). Other parties take the Department's incomprehensible positions less than seriously also. See " Answer of the CS*4 Ccmpanies to the Petitions of the U.S. Department of Justice for Leave to Intervene,' in Central Power & Licht, FERC Docket No . EL 79- S ,

d ated Sep tember 24, 1960, at pages 3-4. Suffice it to say that there are many ins ti:utional and tactical reasons why the Department . night choose to settle an otherwise meritorious case, but tha t a decision to prosecute a case must rest en the firm .

l judgment tha: the antitrust laws or policies are being violated .

i t

- 39A -

designed to termina e the ef fect of the Texas u tilities' long-standing agreement to eliminate interstate ccmmerce should be imposed.

Respectfully submitted ,

N M George Spiegel

• It. 4&v Ron M. Lands?aan

~

w Marc R. Poirie r Attorneys for the Public Utilities Soard for the City of Brownsville , Texas Octooe: 5, 1980 Law offices of:

Spiegel & McDiarmid 2600 Virginia Avenue N.W.

Wa sh ing ton , D.C. 20037 9

i e

l IV. *:s: of Witnesses, Exhibits and Testimony A. FERC Proceeding

1. Brownsville will offer into evidence the factual materials contained in CPL's Application to FERC, filed February 9, 1980 (Re: Central Power and Ligat Co . , e t al . , FERC Docket No .

EL 79-8) 1/ and expects to call as its witness Mr. J. C. Wells, Vice President of Engineering and Construction of Central and Southwest Se rvices , Inc., to identify, explain , support , and supplement such factual evidence, as may be necessary. This evidence will include all of the Application, including Exhibits and verification of J. C. Wells, except the following : Page 1, 11; Page 3, 11; Page 7 110; Page 7, 110, 1s t sentence; Pages 10-11, 117; Pages 11-12, 119; Page 13, 122 1st sentence; Page 14, 523; Page 16 from " Prayer for Pelief" to the end of Page 17.

B. SEC Proceeding

1. Brownsville will offer into evidence the direct testimony and cross-examination of the following witnesses pre- l sented on behalf of CSW at the hearings before the Securities and  !

Exchange Commission in Central and South West Corporation, au al.,

I

( Administrative Proceeding File No. 3-4951, excluding arguments 1/ Applica lon of Central Power and Light Company and

! Others for Exemption from State Commission orders Preventing l Voluntary Coordination Pursuant to Section 205 of the Public Utility Regulatory Policies Act of 1978, and Interconnection of Facilities , Provision of Transmission Services and Related Relief Pursuant to Sections 202, 210, 211 and 212 of the Federal Power Act.

of counsel and rulings by Administrative Law Judge Edward 3.

Wagner (and other non-testimonal verbiage) , and Brownsville expects to call as its witness each of the CSW witnesses, as noted below, to identify, support, explain, and supplement such evidence, as may be necessary:

Dr. Allen J. Wood: Direct (Tr. 523-4; CSW Exhibits 4, 4A and 5); Cross (Tr. 525-528); Redirect (Tr. 829-847);

Recross (Tr. 847-879).

F. George Arev: Direct (Tr. 880-2, CSW Exhibits 6, 7, 7A, 8); Cross (Tr. 883-1217).

Jack C. Wells: Direct ( Tr . 1222-2 4, CSW Exhibits 9, 9A); Cross (Tr. 1224-1501).

S. 3. Phillips: Direct'(Tr. 1504-06, CSW Exhibits 10, 11, llA); Cross (Tr. 1506-1773, 1786-2050, 2061-2119).

James E. McNultv: Direct (Tr. 2121-23, CSW Ex . 15);

Cross (Tr. 2123-2201, 2236-2315).

James Bruggeman: Direct (Tr. 23 27-29, CSW Ex h .16 , 16A);

Cross (Tr. 2329-2810); Redirec t (Tr. 2817-2904, Exhibits CSW 17, 18, 18A, 19); Recross (Tr. 2904-3064); Further direct (Tr. 3134-43, Exh. CSW 22 ) ; Further Cross (Tr. 3143-3174);

Further Redirect (Tr. 3174-3179); Further Recross (Tr.

3179-3200).

P

i Donald Schaible: Direct (Tr. 3068-3070, Exh . CSW 18, 18A, 185); Cross (Tr. 3070-3095).

John W. Turk, Jr: Direct (Tr. 3091-3097, Exh. 21);

Cross (Tr. 3097-3134).

C. Federal District Court, Dallas, Texas Brownsville will offer into evidence direct testimony and cross-examination of the following witnesses (including l exhibits) presented en behalf of CPL and WTU at the trial before the United States District Court for the Northern District of Texas in West Texas Utilities Companv v. Texas Electric Service l Company, No . CA 3-7 6-0 63 3-F, appeal pendine , No . 79-2677 (5th Circuit), excluding argument of counsel and rulings by the Court; and Brownsville expects to call each of the CSW witnesses as listed below to identify, support, explain and supplement such evidence, as may be necessary.

1 i

1 e . 1

_43-Jen. A. Mutchisen: Oirect (t . 68 - 113, Pl . Exh . 1 - 7, 10 - 15 ) ;

C=ss-examinatien (t.118 - 157);

Redirect (W. 157 - 158); Fecross (t . 159 - 160);

Further c=ss (2. 222-225) .

Ja=es F. *uencley Direct (n . 162 - 222, Pl. Exh. 55, 48, 59)  ;

(cy de;cs:.:len) i l

P. H. Fcbinsen Direct (Tr. 226-339, E. Exh.132,133,166)  !

(=y depes:.: en)

Willia = E. ?-ice Direct (W. 340 - 460, E. Exh. 610 - 614, 615, 616, 620, 621, 625, 629, 635, 637, 638, 642, 643, 700 - C3, 705, 709 - 15, 726, 628, 640, 704, 706, 708, 717, 723);

C:ess- exaninatien (2. 461 - 519);

Redirect (Tr. 519 - 523); Becross (Tr. 524 - 527).

R. W. Hardv Cirect (Tr. 528 - 549, Pl. Exh. 719, 725);

C=ss-exa=ination (W. 550 - 655);

Redirect (W . 655 - 658).

Our d Chalker Direct (Tr. 660 - 692, Pl. Exh.127, 720 - 722);

C:ess-examination (n. 693 - 838);

Redirect (W. 839 - 842).

G. Ec1: an Kine Direct (t . 843 - 912, E. Exh. 656 - 658, 729A, 730 - 735);

C=ss-examination (W. 912 - 969);

Redirect (t. 970 - 974)

Er z,ced tlics Direct (Tr. 975 - 984).

(:y de;csit:.cn)

Pcbar: E. Nelsen Cirect (n. 985 - 1000).

( y depos:.::.cn)

Edaard Krause Direct (W . 1000 - 1016).

( y depcsit:.cn)

Jack T. Ard Direct (t . 1017 - 1032, E . Exh. 123).

(:y de;cs:.tien)

Ccnald Pcy Faburn tirect (2.1034 - 1059);

C=sa-exa=ination (n. 1059 - 1064);

Redirect (2.1064 - 1068); Rwress (W. 1068 - 1071);

!chn F. Skelten, Jr. Direct (2 . 1071 - 1128) l l

( V. de:cs:.: en)

e s a

m44-T. *. Aus:i. Cirec: (W.1133 - 1206);

C=ss-emami:.atica (W . 1206 - 1218 ) ;

Redirect (W.1218 - 1232) .

3cri He.lsey Cirect (2.1233 - 1353, E. hh. 88, 93, 94,134, 136);

C:ess-exa=ination (W.1353 - 1375);

Redirect (n. 1375 - 1382).

~4. G. .v.a=uardt Direct (W . 1386 - 1454, Pl. hh.122,124,125, 765) .

Jack S. Farri.cren Direct (W . 1471 - 1594; Pl. hh. 736 - 738);

C=ss-examinatien (n. 1594 - 1763, 1917 - 1984);

Redirect (2.1984 - 2046, E. hh. 76v - 762);

Recross (n . 2047 - 2073).

Sc as Heath Direct (W. 1770 - 1801, E. hh. 315, 401, 410, 418, 436, 439, 461, 466, 468 - 434, 486 - 501, 503 - 510, 512 - 516, 518 - 535, 538, 539, 544 - 548, 550 - 552, 555 - 558, 560 - 565, 569 - 571, 581 - 589, 660, 669);

C=ss-examination (W.1802)

Redirect (n . 1802 - 1803) enald D. Sykera cirect (W . 1806 - 1901, Pl. hh. 334, 357, 363, 403, (cy de,ces:.1cn) 417, 449, 451).

F. Gecrge Arey Cirect (n. 2075 - 2169, E. hh, 740 - 743, 763);

Cross-examination (W. 2170 - 2248, Pl. hh. 764 );

Padirect (n . 2248 - 2261, 2263 - 64);

Rec =ss (n. 2261, 62).

Jeres A. 3=cceman Direct (W . 2265 - 2391, Pl. Exh. 744 - 751, 744A, 754 - 758);

Cross-examination (t . 2391 - 2406);

Redirect (W . 2406 - 2407).

Jchn T. *.4.nders tirect (n . 2416 - 2532, Pl. hh. 766 - 768, 770, 772);

Cross-examination (t . 2533 - 2674);

Redirect (n. 2674 - 2698, E . Exh. 777);

Rec =ss (t. 2698 - 2703).

7dditicnal Plaim'.If 618, 669, 346, 321, 324, 325, 327, 328, 331, 335, Exhibits : 336, 337, 339, 341, 342, 343, 344, 347 - 349, 351, 355, 358, 362, 365, 368, 370 - 373, 375, 378, 381, 384 - 386, 391, 393, 394, 404 - 408, 411 - 413, 415, 419, 420, 423 - 427, 429, 432, 435, 440, 443,445, 450, 664, 189, 190, 192 - 200, 205 - 209, 211 - 223, 225 - 227, 230 - 237, 240 - 243, 245 - 246, 251, 255 - 263, 269, 270 - 272, 276 - 278, 281, 283 - 291, l

. ,a-293 - 294, 297 - 302, 304, 307 - 309, 311, 20, 21, 23 - 25, 31, 33, 35, 38, 41 - 47, 49 -54, 57, 60, 61, 63 - 75, 78 - 81, 83 - 87, 89 - 92, 96 - 97, 99 - 102, 105, 107 - 120, 126, 129, 135, 137 - 144, 146 - 151, 153, 154, 156, 158, 168, 169, 180, 181, 663, 670 - 671, 673, 684, 686, 689, 694 - 696, 162 - 165, 67, 170 - 171, 174, 176 - 179, 182 - 183, 186 - 188, 691 l

l i

s O. Public Documents from the SEC and the FEP.C Srownsville will offer evidence con:ained in public documents filed by the following entities for the years 1974-1979:

Central and South West Corporation Central Power & Light Company Weri Texas Utilities Ccmpany Public Service Company of Oklahoma Scathwestern Electric Power Company Houston Industries , Inc .

Houston Lighting & Power Company Texas Utilities Texas Sower & Light Company Texas Electric Service Company Callas Power & Light Company Gulf States , Utilities Company Lower Colorado River Authority City Public Service Board of San Antonio, Texas City of Austin, Texas Public Utilities Board of the City of Brownsville, Texas These public documents include the following , where applicable :

From the Securities and Exchange Commission:

Form 10-K Annual reports to shareholders Prospectuses From the Fedec al Energy Regulatory Commission Form 1 (or Form IM)

Form 12 Fcrm 423 l

e

E. Decosition Evidence from NRC Proceedinc Brownsville alac expects to offer evidence from the deposi-tions and acccmpanying exhibits of the following persons, taken in this proceeding; and expects to call each of the persons listed below to identify, support, explain and supplement his  ;

l testimony as may be necessary:

S. 3. Phillips, Jr.

Merle Borchelt Durwood Chalker Aaron Autry Wayne Siegelin William Price Glenn Stagg Robert H. Hartley Robert Round tree Larry Gawlik H. E. Hastings

F. Discoverv Evidence from NRC Proceedinc i

i

• 3rownsville will offer as evidence documents produced in the course of discovery in this proceeding. Such documents are described in the following lists, volumes I-VI.

i Brownsville will provide access to these documents for authentication in accordance with such procedures as may be established, by agreement or Board order.

The " Volume I" list includes documents relating to Mexico; wheeling; contract negotiations; 138 kv line; and takeover attempts.

The " Volume II" list includes documents related to competition.

The " Volume III" list includes documents related to par-ticipation in the South Texas Project; to admission to TIS ;

to intrastate restrictions; to STEC/MEC and Amistad; and

~

transmission to the Rio Grande Valley.

The " Volume IV" list includes documents relating to the Port of Brownsville; the Brownsville Navigation District; and Union Carbide's Brownsville plant.

The " Volume V" list includes documents listed by date and document number caly. They have been asserted to be con-fidential either by Gulf States Utilities, pursuant to a Stipulation to Protective order, filed in this proceeding on

-J_. ,.

_49_ .

July 24, 1979; or by CSW or one of its affiliates, pursuant to Board Order of November 7, 1979. The terms of both these orders 1/ prohibit disclosure to certain persons altogether, and to other persons until they have signed a stipulation to observe the order. Brownsville will provide information about and access to documents asserted to be confidential in accordance with whatever procedures are established by agreement or Board order in the course of this proceeding.

Brownsville does not concede that any of these documents is appropriately treated as confidential, and reserves the right to challenge the confidentiality of each such document, as provided in the protective orders.

The " Volume VI" list includes additional relevant documents.

1/ 15 of tne Gulf States Order; 12 of the CSW order. These orders are similar but not iden tical .

w

G. Live Governmental Witness I

1. Brownsville anticipates calling as witnesses to testify en direct questioning, the following experts who have been retained by Federal governmental parties to review the facts and develop opinions concerning the subject matter of this i

j proceeding.

j (a) Robert W. Hartley, R.W. Beck & Associates, retained by NRC Staff.

(b) Argyl Toalster, retained by NRC Staff.

f (c) William Zelinsky, retained by NRC Staff.

(d) William Scott, retained by NRC ' Staff.

( e) Gordon Taylor, retained by Justice Staf f.

( f) Whitfield Russell, retained by Justice Staff.

l I

l l

l l

l Vcim.e I NBC 50-498A, 50-499A Potential Exhibits of 3:cwnsville

" Mexico; h?.eeling; C:n=ract Negotiatiens; 138 kv Shif ; M.eevers" "A"T TYPE FPCM g Paces I.D.

• i 6/1S/62 Latter J. L Tates J. E G.itride 2 CP A 10914-15 10/5/63 .vemo Inter .atienal Cerr.ecticn of 2 TS 21928-29 CP&L, WIUC.

6/8/64 Iatter L:velady N.A Easter 1 CP A 10907 9/1/64 Ltr

• Bei.xJ N.A Easter 1 CF A 10904 7/24/78 Memo Snith Wells 1 CP A 12006 7/20/78 Ltr Brown Snith 7 CP A 12007-13 1/19/65 Ltr Being Collins 1 CP A 04196 1/19/64 Ltr Sampson Being 1 CP A 04197 ne date Memo Easter 1 CP A 10748 5/13/65 Ler Easter Bayardo I 1 CP A 10745 5/13/65 Ler Siegelin Mabe 1 CP A 10746 Blackt:crn ,

8/8/68 Newsclip RTd Cow Ogles CPEL and Mexico 1 CP A 03282 11/7/68 Craft CP&L Tme of5 ice Mtg Mabe 2 CF A 03968-69 of Minutes 3/13/69 Metc tavis Joslin 1 CP A 03960 4/14/69 Meme Scr:helt Siegelin 2 CP A 10620-21 10/21/69 Memo Wilsen Ekvis 4 CP A 10447-50 11/4/69 Minutes ' Gary 7dmin. 2

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2/1250 Ler Siegelin Partin 2 CP A 10575-79 5/12M0 Me.m Scrchelt Seigelin 3 CP A 10568-70 5/27/70 Ler tavis Martine: 1 CP A 10564 3/1961 Cradt cf Seigelin rs 7/19, 21B 1 =tg 4 CP A 10860-63 Minutes CP&L; GE 5/1652 Merne 21chelt Seigelin 3 CP A 31801-03 3/1254 Minutes Scichel: GP&L-GE Eard Mtg 4 CP A 10376-79 S/10M7 Mece 21chelt ACstry 3 CP A 10/3M7 Minutss CPE mtes CP&L- CFE Meeting 1 CP A 10273 9/11/78 Me:c krchelt Hardy 1 CP A 10239 10/24MS Me:nc Cesak Berchelt 1 CP A 10767 12/14M5 Ler Cesak Sada Gami: 1 CP A 10258 7/27MS Ltr Cesak Cordero 4 CP A 0118709-12 no date Me:nc Descriptiens+ Cam: cents en 3 CPA 12187-89 1978 I. cad 2/13M8 Ltr mundtree Cordero 2 CPA 55226-27 7/15B7 Ltr Bastings Autry 1 l

7/15M7 Ler Eastings Autry 1 CP A 04614 (?)

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1 11/77 (?) tbtes 02ick Ec lbv 2 3 A 81512 l 1/19M8 Ler Lage Pettinos 1 CP A 18725 j 9/11M2 Memo Borchel Fardy 1 CP A 10269 7/26M7 Ltr Fardy 1 A 81130 2/20M 9 Ltr Ct sak Wells 1 A 0015213 4/2/65 Ltr Jeslin Gideen 3 A 81901-03 10/29M4 Minutes "Alcoa Meeting" 1 B 0017475 7/26M7 Ltr Gross Fardy 4 CP A 03741-43 6/17/66 Craft 2x: mas .t ursund 8 HP 326253-58 5/64 Craft teslin t mmershausen 2 EP 002945-46 1 l

4/16/64 ?btes .Ters said be.. 1 CP A 07260 l

7/3/53 Meme Wines Bates 1 CP A 10208 j 4

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7/2SM7 .Mme Erchelt Files 1 CP A 08644 1977 Be;:crt "Yansmission h;reement with 2 CP A 81307-08 S~EC-Medina.

2/17/76 Ler Hastings Mtry 1 3/1/76 Me::e Eastings File 2 3/lM 6 Memo Eastings File 1 3/26M 6 Ler Mtry Eastings 1 3/20M6 Ltr Stensen Eastings 4 4/23M6 Ler Stensen Eastings 2 5MM6 Ltr Stensen Eastings 3 5/12M6 Ler Stensen Easti.gs 10 10/23M3 Ler Price Boundtree 2 12/11M5 Ler ibrbus Kropewnicki 1 3/14MS Peport "SEPC-TIS R.elling Power 1 CP 3 0010683 Guidelines" 4/363 Meme Hardy Snith 1 CP B 0007391 7/13MS Memo 'ntyler Mmin C%e 7 5/859 Draft "CE'/'1'IS 2ansnission. . . " 4 CP A 0114953-57

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5/6M5 Ltr W.an Williams 2 CP 1/662 3eper Kralik Sc: mary of .*g 3 3 0017476-78 4

1M4 Be;crt Info. Pequested by Atty Gen. 15 CP B 0090001-14, 70-78 5/2557 .%ar Bar: Mabe 2 CP A 0090270-78 7/24M2 .% T Greenwood Buchanan 1 Stodghill Seper: 1 CP h7., 01907 3/19/61 "CK Int'l.. Parallel oc.

with CP&L.

!b date Peper Beg's R:r Parallell C;eration 2 CP A 94809-10 of CP&L and Cust:::mers Generatings

! no date Pe;cr Exhibit A 1 CF A 94768

!b date Misc Pe 3 CP A 94764 CP A 94790 CP A 94784 l

4/1054 Minutes CP&L 15 CP A 0115443-57 5/1340 Memo Danten Davis 2 CP A 56134-35 1/363 Memo Siegelin Files 3 CP A 55904-06 1/453 Ltr Martin Eastings 3 CP A 10690-92 5/3053 Memo Horine Siegelin 1 CP A 572262 i S/1753 Ltr liorine Eastings 1 CP A 57401

?b date .% T Memorandem cf Ccnference 1 CP B 002679 4

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5/1256 Ler Stensen Eastings 4 11/1457 . Memo Willins.c:2. Cavidson 3 11/1657 L:: Mundtree Price 2 CP A 55195-96 11/2957 .Meme Willingswerth Li:ka 3 12/557 L:: Price mundtree 2 CP A 55193-94 3/5/'5 Minutes "PCB M g- Brenwsville offices 1 CP A 55204 3/17B8 . Memo Willings.crth Li:ka 5 CP A 05508-12 5/15/75 . Memo Willingsw::rth Edelstein 4 .CP A 05442-45 10/23MB Ltr Price kundtree 2 .

3/959 Ler R:cdsey Sith 1 EP 0053409 2/19B9 .%ne Smith Foolssey 7 EP 0053410-16 3/22M9 Ler Hendrick Richetts 2 CP A 0114635-86 2/23M9 L:r Hendrick Richetts 2 CP A 0114633-25 3/1659 Ltr Spencer Snith 1 CP FT 0053400 3/2369 L:: Loveless Suith 1 CP FT 0053404 S/2SM9 Ler R:cisey Snith 1 CP HP 0053401 3/29M9 L: Snith Spencer 1 CP HP 0053398 5/29/79 Ltr Snith Scencer 1 CP F? 0053402 9BB9 Ltr M xsl M y Richetts 1 CP HP 0053396

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11/1658 Ltr Jinnette Gardy 2 CP A 06422 12/27B5 !btes CM(list) 1 A 86784 2/2755 Memo ,4cn Eardy 1 CP A 04805 2/20B5 L:: Hardy Mel: 1 CP A 04806 2/4/75 L:: & nerd Mtg Eardy 2 CP A 04807 6/653 Memo brine Davis 1 CP A 57261(?)

10/950 Mene Kiriel Files 2 CP A 56798-99 115/62 Memo Spealer Gardner 3 CP A 03984-86.

7/13/68  ! bet s Gary 6 CP A03113-18 7/3/62 !atter E.S. Jeslin Mayer of 2 CP A01930-31 Brownsville 6/17/63 Mv. " CPL Pre;csal to I. ease 4 CP A04029 Brownsville 6/15/68 News Clip "Fejection cf CPL offer 1 CP A04030 Urged..."

6/12/68 Meme '"+.at .w, u can do t= help" 3 CP A02541-43 N.D. Memo R.L. Jchnsen E.S. Joslin 2 326433-36 5/20/65 Minutes "Ed cf Direc: Ors Meeting" 4 CP A02614-17 4/15/6a Memo "Cenfidential" 1 CP A03452 4/10/68 News C.ip *Almint= Fi=n Eyeing Plant" 1 11/24/67 I.etter R. M::Clanahan 3.M. Cavis 4 A 08350-53 9/14/67 Memo B.M. Davis 3:cunsville 1 A 03449 l

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, 9/5/67 Letter R. .vcClanahan E.S. Jeslin 1 CP A02883 7/14/67 .%me 3. tavis E.S. Joslin 5 A 08463-67 12/6/66  ?;::. R. L. Jchnson S.S. Phillips 3 EP 326441-43 1/31/66 Ltr. PSP E.S. Jeslin 4 EP 326171-74 10M/65 Merc 3. tavis Brownsville 2 CP A 01882-83 3/5/66 Me.mc C.C. Wire E.S. Joslin 1 A 01411 6/10/65 Mint::es Earlingen C::t:ntry Cid 2 CP A04147-48 6/24/65 Minutes 3.M. tavis Bayview C16 2 A04156-57 3/9/65 Fer: 1 A 01333 12/13/63 Note J.S. Csberne E. Joslin 5 CP A02796-800 11/23/63 L::. J.C. Cecrge J.L. Bates 1 CP A01663 1/2S/60 Ltr. J.L. Bates Mayer cf 2 EP 325217-18  :

Brewsville 5/'7/59 .%me W.Cunningham Brew.sville 3 CP A04367-69 S. ::. .%me Confidential survey 2 CF AS4444-45 l l

3/12/56 Ltr. W. Richardson J.L. Bates 5 CP AS4439-43 4/12/57 Ltr. J.L. Bates W. Richardsen CP A 1/23/57 L:r. J.L. Bates Wu. I ngman EP 324347 9/3/52 L:r. R. G. G:rza J.L. Bates 5 CP A53266-68 5371-72 l

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5/5/79 Ltr. J.R. Milferd D.A. Kaplan 3 1/2/73 Ler. R.A. Segrest L. Carter 2 10/14M 6 Ltr. E.L. Watsen J.R. Milford 1 3/16/79 Ler. G.E. Kirq J.R. Milford 2 s

4/29/77 Memo " Purchase of City of Electra 3 1 Muni..."

1/65 2 Minutes W.A. Kralik Meetirs/Eartseck 3 50017476-78 154 Data Bes. " Infer Pequested by Atty. Gen." 6 CP 30090061-64 70-73 N.D. Bate Sch. Exhibit R - CPL Bate Schedules 9 CP B0090270-78 5/25/77 Mem. M.C. Barr J.M. Mace 2 CP A08760-61 7/24/75 .%me R.W. Greenw:cd E.J. McGinness 1 5/13/7C Me.m 3. Centen B.M. Cavis 2 CP A56531-32 12/14/72 Me.m R.S. Jinnette R.E. Ibrine 1 CP AS1989 1/3/73 .%me R.E. ! brine S. Eavis 1 A80511 10/30/73 Me.m R.E. ! brine S. Envis 1 A80512 3/2/67 Ltr. M.E. IcVelady J. &:tchinsen 2 HP 7/25/77 Ltr. D.S. tx:rt.as E.E. Eastings 2 5/215 9 Ltr. R.E. Foundtree D. C.alker 1 6/20M9 Ltr. W.D. Crawford R.E. Boundtree 1 G 5/2159 L. R.E. R::endtree U.D. Crawford 3 GS 7/26/77 L: . L.E. Gecss E.E. Joslin 1

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l 1/65 Ppt. Pelatiens with FIA C:cperatives 10 EP 002984-93 6/17/66 Ltr. D.S. Scr.as A.W. Mcursund 5 EP 326253-60 12/6/69 Ppt. J.W. Blac)it n Tesure of LCPA 8 EP 003367-74 5/31/74 Memo .LS. Jinette A. Autry 1 CP A07312 7/26/ 7 *tr. L.E. Gecss E.E. Joslin 1 11/12/64 Memo 3. mvis Meeting / PUB Bep. 2 G A01403-04 3/26/65 L::. S. 3 ceks L. M. Harvey 2 CP A03021-22 6/24/"

• utes 3. hvis Meeting / CPL Nav. 2 CP A04153-54 7/6/66 P cpesal 2 c=nstruct... Gen Station fer 8 G A 03013-20 Earvey Altninum S/5/66 Ltr. W.P. Earnard E.S. Jeslin 2 CP A03002-03 9/2/66 Ltr. E.S. Ccslin W.P. Barnard 1 CP A03005 9/15/67 Me. c 3.M. Davis "Brcwnsville" 2 CP A08361-62 10/25/67 Memo 3.M. Dwis " Industrial 1 CP A08333 Cevelcunnt" 11/27/67 Merc 3.M. Cavis 3 cwnsville 1 CP A68354 1/26/71 Ltr. E.R. Ecward P. O. Gillovt 2 CP A31082-83 1/25/71 Ltr. D.S. 2cres.s E.K. Tcward 3 CP A31084-86 EP 0004526 12/6/~6 Memo V. Eilliard L. M::rrcw 2 CP 30015404-05 N.D. iandwritten notes 2 CP A01272 4

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! N.D. Ppt. Area Develegrnent 2 CF A02448-49 1/3/74 Press .tre Jcbs 5::: Ecuth "txans 2 CP A30751-03 Palease EP 0004296-87

3/4/74 Ltr. J. D= ham S. Wichersham 1 . CP A30811 EP 0004342 i 3/22M4 Ltr. J. n:rham J. M. Welch 3 CP A30807-09

- EP 0004339-41 4

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EP 0003484-86 12/6/~2 Merc J. a:rham 3. Cer. ten 2 CP A30187-90 EP 0004129-30 l 5/17M3 Ler. J. Drham R.A. Forbes 2 CF A30869-70 EP C004395-96 2/27M4 Minutes Pittsburgh Plate Glass Mtg. 1 CP A15129 EP 0011841 I

1976 Ltr. J. Crutchfield W.S. Wilsen 1 CP A30653 EP 0003638 10/14M9 Ltr. J. Crutchfield W.S. Wilsen 3 CP A30391-93 EP 0004174-76 2/12M9 Memo J. 7,a;:ata B. Price 1 CP A12228 EP 0008979 9/18/68 Me:no N.D. Head E.E. M::rtimer 1 GS

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1/3169 Memo T. Deweese F.L. Johnsen 1 ASW 0000297 5/3M4 lbte F.L. Jch:usen 1 ASR 0000301 1 11/SM7 Ltr. T. te wese E.T. Short 1 ASW 0000298 7/15M6 Ler. R. Knight 3 ASR 0000161-63 10/1758 Me. c C. B. Snith E.J. Best 1 ASW 0000482 10/3055 Memo H.W. Lancaster E.J. Best 2 ASW 0000483-84 i

3/22M9 Ltr. E.J. Best K. Heald 2 ASW 0000480-81 4/2/79 Ltr. E.J. Best J. Iamar Stall 2 ASW 0000478-79 4/17M9 Ltr. J.L. Johns J. Iamar Stall 2 ASW 0000473-76 4/1959 Ltr. J.L. Gardner J. L. Johns 2 ASW C000468-69 12/3/64 Memo J.R. Welsh H.L.McMams 4 ASW 0000302-05 4/20/79 Me.mo E.J. Best Local Mgrs. 1 ASW 0000467 4/20M9 Memo J.D. Cardner E.J. Best 3 ASN 0000470-72 N.O. merno T. Cewese F.L. Johnson 1 ASN 0000280 i

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2/19A3 Memo  ?. rash Siegelin 1 CP A 32005 3/1953 South 3. San An=nio, CP&L, EPL 7 CP A 32006 Project Brochure 7/3M3 Memo  ?. rash Siegelin 2 CP A 31870-71 7/1/73 Scuth h. San An=nio 7 CP A 32118 Project Brochure 9/17B3 !atter Eastings Ecrine 1 9/2354 Ltr Siegelin Eastings 2 CP A 32023-32024 9/2354 Ltr Siegelin Shepgerd 1 CP A 32026-32025 9/2364 Ltr Siegelin Alejandro 1 CP A 32027 9/2354 Minutes Thrash (STP Meeting) 5 CP 00839-00843 11/5M4 Minutes  ?. rash (STP Meeting) 4 CP 00932-00934 3/3053 Ltr Shepperd Ji".nette 1 CP A 32012 9/1253 Ltr Mtuters kulden 1 CP A 32014 10/2453 Memo krchelt krine 3 CP A 08856-08858 9/653 Ler Hancock Siegelin 2 CP A 32015-32016.

10/1253 Me.m SIP Techincal Siegelin 6 EP 5160000634-39.

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4/30/74 depert Qinner 6 EP 25180000681-85 9/19/77 Memo PL:::cel Me 6ers 1 CP 0021561 2/23/67 Ler ;cstin Eclsey 1 TS 22004 12/17/70 Memo Gary 3:rner 2 CP 24422-23

, 1/29/72 Me.m Mast Siegelin 1 003883

!b date S-'? Participatien igeenent 18.2 2 6/16/75 dbte Chalker Bill 1 HP 11695 i il/24M4 ;g eement *dIU Gate City 12 HP 11696-707 10/15M5 Ltr E3. rod Yarbrough 2 EP 4

ll/4M6 Minutes 2 EP 1

4 1'/6/68 Memo Scarth htchison 1 T? 25722

Regers Pobuck 10/30/68 Ltr Schneider 3::binson 2 25070001681) 11/11/68 Craft of 2 Mabe CP&L of WB 2 CP A 02939-40 11/14/68 Memo Scarth &lsey 2 EP 12162-63.

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9/15M2 Lr Hastings Tynan 1 CP 24354 9/1962 Ltr 7ynan 'a:rner 1 CP 24355 5/16B5 Ltr Tynan Jolly 2 EP 12579-80 5/27B5 .%:ne Jordan Standish 1 5/28M5 Ltr Jordan Fardy 2 5/20M6 Ltr Hardy Beese 2 DP23199-200 S/19M6 Ltr Jordan Fardy 1 EP 25M8 Ler Smith 2nner 1 CP 64737 2/22MS L: Meader Tanner 2 CP A 64788-29 4/20S3 Ltr Shith Bruggernan 2 CP A 64795-96 6/1/62 Mere Prisey 2 TS 21962-63 1/2651 Ltr King hylor 2 HP10010001048-49 6/10/64 Me-c Pulsey Fisher 1 EP 11518

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1/65 Staterent "Felations with BEA Ceeps 10 EP 002984-93 7/9/68 L:: Chase Schneider 2 CA 5/23/68 Ler Schneider Udall 1 IA 9/3/68 Ler Bennett Schneider 1 DA 9/3/68 Ltr Bennett Schneider 1 CA.

9/20/68 Meme ravis 5 CP A 3326-3330 10/S/68 .%me Jenkins Files 2 CA 10/11/68 L: Myers Jenkins 1 CA 10/25/68 Ltr Schneider Ibdrigue: 2 CA 10/25/68 Minutes k rchelt 2 CP A 10649-50 115/68 .% ites Mabe 2 CP A 03308-09 11/13/68 Meme Hill N 4siene: 1 CA

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. "YPE FFCM T PAGES I. C. #

j 11/13/65 Ltr  :-211 Friedkin 1 CA

11/29/65 Me. c Cavis Joslin 3 CP3265-3270

12/3/65 L

: Schneider Hill 2 CA 1/3/69 Bepert APPA Newsletter page 5 1 i 2/21/69 Ler Schneider Jen &.s 1 CA 2/23/69 Ler h psen Schneider 1 CA i

2/23/69 Mere Cavis Siegelin 1 CP A 03278-80 3/3/69 Ltr tavis Ibdriguez 2 CP A 10627-28 1 3/13/69 Memo Cavis Jeslin 1 CP A 3960 4/14/69 Mecc krchelt Siegelin 2 CP 10620-21 l 6/5/69 Ltr Ekvis N riguez 3 CP 10614-16 i

5/27/69 Ltr Hill Schneider 1 CA 1 S/27/69 Ltr Hill Schneider 1 IA 12/31/68 Sum:ary Anistad tam Investment 2 CA I

11/5/69 Me:c krchelt Siegelin 3 CP A 10597-99 3/5/75 Memo krchelt Siegelin 2 CP A 08841-42 7/24/75 Meme Erchelt Siegelin 2 HP 005477-78 7/24/75 Memo Berchelt Siegelin 2 CP A 8834-35 7/2455 Ltr Siegelin Shepserd 1 CP A 08833.

3/26/75 Ltr p. 2 Gress Eardy 1 CP A 08825 1/27/76 Ltr Gecss, Shepperd Hardy 2 CP A 08801-02 2/1256 .v.inutes Li:ka 2 CA 2/24/76 Ltr Eastings Shepcerd 1 CA 3/6/76 Note 1 A 81503

CA*"I "YPE FPCM 70 PAES I. C. #

11/1/76 Meme Jinnette Pardy 1 CP A 08776 2/1157 Note 2 CP A 09107-9108 6/667 L:: 4 CP A805-48 7/26/77 Ltr .tts:n Fardy 4 A 81130-33 3/257 Ltr C appelear Eastings 1 CA 4/4B8 Memo Jinnette Hardy 8 CP 8891-98 7/245 S lbte Dept of 19 1.. CP&L Centract 10 CP A 81716 2/553 P=;csal Campoell.... 18 CP A 55916-933 No date Plan 3 1 CP A 55925.

Tc da:e Plan A 1 CP A 55924 10/31M3 Me.- c Cesak Otylor 2 CP A 57462-63.

2/5M4 lbte 3 CP A 56085-87 1/1154 Note 5 CP A58089-93 5/6M4 Ltr Autry Gandy 1 CP A 80978 6/6/73 Me.-c krchelt Herine 2 CP A 57242-43, 3/2254 Pr:pesal 3 CP A 57439-441 6/454 Me.m Nichols Cesak 1 CP A 59012 9/29/76 Mem CP&L Price 1 CP A 55608 7/2257 Meme Cesak Cerecran 1 CP B 1107546 8/357 Ltr Greenwood Hughes 1 1/1342 Memo krchelt Herine 2 CP A 01721-22 6/11 53 Ltr k rchelt Iant: 1  ;

7/6/66 P:Opesal Barnard 8 A 03013-3020 l l

l

'.A~I

. ~YPE ??CM "O FAGS !. C.

• 5/5/66 L: 3arnar:! Jeslin 2 CP A 03002-03 9/2/66 L: Aslin Bar tr:! 1 CP A-3005

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l . -

NRC 50-498A, 50-499A 4

Potential Exhibits cf Brownsville i Vol. 4 "Por: Union Carbide" i

I 1

"2 J  ?!PE FPCM g Paces I . D . #,

i 2/23/59 Memo Bill Price R. L. Dmten 2 CP A52823-24 6/17/59 L:r. W.C. Price B.C. Wright 2 CP A52770-71 S/31/59 Memo W.C. Price P. C. Gilber: 1 CP A77482

! 2/20/60 Ltr. R.G. Garza J.L. Bates 1 CP A53963 1

j 2/19/60 Ltr. F.W. ref:ckel R.G. Garza 2 CP A53964-65

! 5/6/60 Ltr. J.L. Bates J.C. George 2 EP 325276-77 i

I 5/10/60 Ltr. J.C. Geo ge J.L. Bates 1 CP A54022

] 5/18/60 Ltr. J.L. Bates J.C. Gecqe 2 CP A34020-21 5/25/(0 Ltr. C. C:cwe F.W. Ibi:ckel 2 HP 325293-94 11/21/80 Ltr. R.G. Garza J.L. Bates 1 CP A53830 2/6/61 Memo Bill Jesiin 1 CP A04274 5/29/61 Memo W.C. Price R.A. Ewing 2 CP A04272-73 5 2/12/62 Chart AN/Berchelt Bene. 100MN 1 CP 9/10/62 Ltr. W.C. Price C.C. Wine 1 HP 0001043 9/17/62 Memo W.C. Price C.C. Wine 2 CP A20158-5/9/63 Ltr. J.S. Csberne E.S. Jeslin 4 CP 02836-39

& enc 1.

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J

i

. u W1. 4 " Pen-Cnien Ca=ide l

I l l

5/27/63 . veno J.M.Wisen E.S. Aslin 2 CP A03000-01 l

7/1/63 Meme W.C. Price C.C. Wine 3 CP A02113-14 7/17/63 Meme W.C. Price C.C. Wine 2 CF A02824-25 i

8/8/63 Ltr . W.C. Price D.M. Given 2 CP 1

! S/14/63 Meme W.C. Price E.S. Jeslin 3 EP 0002054-57

CP A02168-10 i

10/3/64 Minutes - iCB/ CPL 5 CP A08030-34 11/12/64 Minutes B.M. Davis WB/ CPL 2 CF A01403-4 3/26/65 Ltr. S. Brocks L.M. Harvey 2 CP A03021-22 6/24/65 Meme B.M. Eavis CPIARtD 2 CP A04153-54 7/2/65 Ltr. W.C. Price Y. Garza 1 CF A041'2 1/3/55 Ltr. W.P. Barnard E.S. Jeslin 1 CP A02736 1/12/66 Ltr. W.C. Price W.P. Bacard 1 CP A02735 -

7/6/66 P= csal FJB Ccnstruct on 375 .W Plant 7 CP A03013-20 for Harvey Altminum 8/5/66 Ltr. W.P. Barnard E.S. Jeslin 2 CP A03002-3 9/2/66 Ltr. W.C. Price W.P. Barnard 1 CP A03005 9/15/67 Meme B.M. Cavis 2 CP A08361-62 10/25/67 Meme B.M. Eavis 1 CP A08363 t

e I

e

'lel. 4 'P:r:-thion Car =ida" l 11/27/67 Meme S.M. Davis 1 CF AC8G54 4 6/26/69 Meme W.C. Price C.C. Wine 1 CF A19870 7/9/69 Memo T.J. C= lee W.C. Price 3 CF A56446-7 l

S/4/69 Memo D. Clark T. Orlee 1 CP A56448

~

S/6/69 Memo M.L. Scrc. % 1t C.A. Mast 3 CP A56/.26-29

, 3/13MO Meno T. C.:rlee W.C. Price 1 CP A196670 HP 0001900 C.2: cents (thien Carbide) 2 CP E0006308-9 7/31/70 Memo B. Davis 1 CP A5 1/25M2 Memo R.E. Brine 2 CPA56580-81 6/27/73 -Memo M.L. krchelt R.E. B rine 2 CP A57236-7 j 2/lSM4 L:r. H.E. Hastings R.E. brine 3 CP A57428-30 3/8/74 Meme W.P. Suith M . B rine 1 CP A57427 4/24M4 Minutes CPL /th':n Carbide 3 CP 0067253-55

4/26/74 Ltr. R.W. Cheenw

cd T.V. Shockley 4 CP B0087256-59 6/4/74 Memo H.G. Nichols C.E. Cksak 2 CP A56012-13 7/12/74 Memo Al Cisneros Y. Garza 3 7/22/ Memo M.L. 2rchelt W.G. Siegelin 2 CP A57363-64 7/22M4 Memo B.C. Kirx!al A. Autm.r 2 CP A57539-10 1/23M5 Mar:o M.L. brehelt R.W. Hardy 3 CP A57357-59 l

l

W1. 4 "P:r: *:nien Carcide" l l

l 1/27/75 Ltr. Al Cisnercs R. Hardy 1 CP A04832 2/24M5 Ltr. R.W. Hardy n Cisne:cs 1 CP A04831 2/2M5 Memo R. C. N::ngard E. G. Lut: 2 3/13/75 Ph utes CPLAhien Carbide 1 C." 10007113 9/30/75 Memo J.G. Sarr!cval T. Shockley 2 10/17/75 Ltr. T.V. Shockley D. Madden 2 CP B0007104-5 12/255 Minutes J.A. Ferner CM /Carcide 17 12/955 Minutes CM./ Carbide 1 CP A56128 1MM6 Minutes PUBAhion Carbide 6 CP A4863-68 1/7/76 Memo KB/ Union Carbide CP 30002677 1M/76 Newspaper 2 CP A05990-1 2/2M6 Me o W.C. Price A Mtry 1 CP 05972 2/10/76 Ltr. M.D. Stensen H.E. Hasti.g s 2 2/12M6 Minutes Lizka WB Special Meetire 2 D4 Memo Alternatives to trarusmissien 6 CP B0002650-55 2/13/76 Memo R.D. Eb: bus W.C. Price 1 CP A05992 Map " Plan X" 1 CP 2/17/76 Ltr. H.E. Eastings A. Mt 9f 1 I

W1. 4 "?cr -LT.ica Carcide" 2/18M6 Minutes 3 & UCC 2 CP A55757-3 2/19M6 Minutes CFL & END 1 CP A55759 3/1/76 Minutes E.E. dastings !.CPA & PUB 1 3/10M6 %mo W.C. Price R.W. Hardy 2 CP B0002608-9 3/19/76 vene W.C. Price Ibff Hardy 1 CP A06024

3/26M6 L

r. W.',A McManus I. Lizka 2 3/26M6 Ltr. A. ;ctry E.E. Eastings 1 2

3/29M6 Ltr. R. Edelstein I. Li:ka 2 CP A05955-56 3/29M 6 Memo t.rc 1 CP A55751 i

3/30/76 Ltr . M.D. Stensen E.E. Eastings 4 d

3/31M6 Ltr. Eteenwood TV.Sheckely,III 1 000632 4/1M6 Memo thidentified 1 CP A55744 4MM6 Ltr. E.E. Eastings A. Ictry 1 4M/76 Ltr. I. Lizka W.W. McManus 2 4MM6 Ltr. R.Edelstein W.W. M: Manus 1 CP A5942 4/SM6 Ltr. W.W. M: Manus W. Colwell 2 CP A05933-34 4/SM6 Ltr. W.W. ItManus Y. Garza,Jr. 2' CP A05960-61 4/6MS News E"a !btes 3 CP A-6005-07

- Vel . 4 "Per -L*nien Carcide" l

4/956 Ltr . M.D. Stensen E.E. Eastings 3 4/12/76 Ltr. W.C. Price R.W. Greenwood 2 CP A06178-79 4/13M6 Ltr. Y. Garza, Jr. R.Edelstein 1 CP A55716 4/13/76 Ltr. Y. Gar a, Jr. R.E:!alstein 1 4/135 6 Ltr . Y. Gar:a, Jr. R.Edelstein 2 4/14M6 Ltr. R.Edelstein I. Liska 2 4/15M6 Ltr . I. Li ka R.Edelstein 2 4/16M6 .%ece A.Cisneres 4 4/2156 Mero R.D. Forbus W. *k alik 1 CP B0002591 i

4/21M 6 Memo H.E. Hastings I. Lizka 2 I

R.W. Hardy 4/22M6 Ltr. I. Lizka -

2 4/22M6 . Memo " Terms of Agreement" 2 CP A05964-65 4/23M 6 Ltr. A. ;ctry R.E. Hastings 1 4/23M6 Ltr. A. h.:tr v I. Lizka 1 4/23M6 Ltr. M.D. Stensen E.E. Hastings 8 Memo File 3 CP 02576

5MM6 Memo "CP&L .%sponse to Propesal 1 CP A05963 by Al Cisneros" Ltr. M.D. Stenson E.E. Easti.g s 3 f

I i

O i

l 1

\bl. 4 "Per .-Union Ca: tide" 12/5M7 Ltr. Eweend W.C. Price 2 CF A06066-7 12/27/77 .h W. kalik W.C. Price 1 CP A06424 12/20B7 L :. m W eenwood W.kalk CP 06425-26 S/lSMS Me::o W.A.Kralik W.C. hice 1 CP 30002853 8/1153 Ltr . RiGreenwood W.A. kalik 1 CP B0002854 9/6MS Memo W. kalik T.Curlee 1 CP 30002847 8/29BS Ltr. &Weenwood W.C. Rice 2 CP 30002848-9 11/658 lbtes (M/ast) 2 CP A06135-36 11/1358 lbtes (M/ast) 1 CP B0002831 12/2358 lbtes (.W ast) 2 CP 30002803 tbtes (M/ast) 2 CP A55513-14

!btes-Map 2 CP B0002725 ll/16M2 Ltr. R5Jir.nette L.Gandy 2 CP A06422 12/115S Ltr. W.C. Price E. Lant: @ CP A555114 11/16BS Memo K.C:ar.ack File 5 2/SM9 Ltr. W.C. Price KiB 2 I

l 1

l l

1 e

. 's SRC 50-498A, 50-499A Index-doctnents Voice V Confidential 4/10B5 G1 4/21M 9 GS 2 3/3M6 GS 3 3/lM6 G5 4-7 2/20B6 G S-10 2/3/76 G 11 3/14B7 GS 12 3/2SS7 GS 13-14 4/6/~7 G 15 4/1957 GS 16 5/18M7 G5 17-18 7/12M7 GS 19 8/23M7 GS 20 8/19B7 GS 21-28 7/1958 AF4 0001904 5/25B7 GS 30-31 8/18M7 GS 32 Confidentiality of these &,c. rents has been asserted p= scant either to the Stipulation to Protective Ceder filed July 24, 1979 (relating to doctments produced by Gilf States) er to the Protective Crder issued by the hard cn tbvember 7,1979 (relatire to doc =ents produced by C5W and its affiliates.)

Brow.sville does ret cencede t'.at these doctments are accropriately treated as confidential, and reserves the right to crallenge the confidentiality cf each such cbcument.

l l

. s Voice 5 Confidential D** 3 ,

oo @ . n 6/26/58 GS 33-35 10/11/63 G5 36-38 3/11/69 O A75468 2/21/78 O A27912 3/9/77 O A69880 3/27/78 O A23709 11/4S6 A 64084-85 12/13/76 O A64031 12/15/76 O A04080-82 3/76 O A58312 10/29/74 CP B0017475 2/5/76 CP A30738_

7/13/76 CP A26347' EP 0013415 7/26/76 CP A26346 HP 0013414 1/3/77 CP A26344 EP 0013412 4/18/78 CP A23081 E 04729 N.D. CP A23080 E 0478 Confidentiality cf these doctnents has been asserted pursuant eider to the Stipulation to Protective ceder filed July 24, 1979 (relating to doc =ents produced by Galf States) er to the P:ctective Crder issued by the Pard en November 7,1979 (relating to dec=ents produced by CSN and its affiliates.)

Brew.sville dces not concede that these dcct=ents are a,wpriately treated as confidential, and reserves the right to -

challenge the confidentiality of each such dec=ent.

l l

Vel =e 5 C:nfidential h 10/955 CF A13555 EP 0010494 i

12/1958 G A21301 5/29/ GS 69 9/2357 O A23082 E 04730 5/24B2 CP A08384-87 3/2656 CP A59057-59 7/19/68 G5 75-76 S/4M8 GS 77 1/4/66 G5 88-91 1B/75 O A64141 6/1055 CP A64130 7/21B5 CP A6410546 N.D. CP A 64107 3/2557 CP A64043 1/31B8 CP A57679-82 3/11M8 CP A05983-84 8/11M8 CP 30003854 S/S/63 CP Ccnfidentiality of these dcct nents has been asserted pmsuant eicer to de stipulation to Protective Ceder filed July 24, 1979 (relating to docm.ents I:roduced by Gulf States) er to the P : ective Crder issued hy de Ecard cn tbver.ter 7,1979 (relating to doce.ents produced by C&T and its affiliates.)

~

Brow.sville does not ccccede dat dese docm.ents are acerc=ria.elv treated as confidential, and reserves de rich to

~

c.Lillenge de confidentiality of each such docment.

Vel = e 5 Ccnfidential

, bhh -

N.D. G 06532 C? B0002726 CP 30002727 10/26/73 CP A96515-16 8/22M7 101-102

! 5/27M 5 CP 30033778 2/14/67 GFJ 496 (104) 1/1957 GS 105 ll/17A9 G 106-108 11/1"/70 G 109-110

, 7/7A6 G 111 3/9/78 G5 112-114 5/2605 G5 115-116 l

6/14M5 G5 117 S/3MS GS 118 1/12B9 G5 119-121 3/15B9 G5 122-125 N.C. G5 126-127 2/159 GS 128-130 i

Ccnfidentiality of these decments has been asserted p.::suant either to the Stipulation to Protective Ceder filed July 24, 1979 (relating to docutents pecduced by Chlf States) er t= the Protective Ceder issued by the B::ard en !bveder 7,1979 (relating te decunents pr:duced by Csi and its affiliates.)

3rownsville dces not concede that these dccutents are aswpriately treated as c=nfidential, and reserves the right to challenge the ccnfidentiality of each such dccumer.t.

D**D "D g- I Wlu:ne VI NFC 50-49SA, 50--499A

g.

• 3fl T(1 3 I

m *YPE FFCM 20 Paces I.D. #

1/21/65 Ltr. Iace L:nelady 1 j S/19/G6 Ltr. Shepeard tunnershausen 1 4/2552 Ltr. Gross Siegelin 1 l 11/953 Ltr. Alexander Grcss 3 j 7/24M5 Ltr. Siegelin Shepperd l S/1455 Ltr. Shepperd Siegelin 2 Gross e

l 3/11M6 Mene Wi:terley Gross 5 l w/ enc. Shepperd Imge i

7/26M7 Ltr.79n. Rtsen Fardy 4

' Gross 6/9M8 Ltr. Jinnette Geess 1 w/att: draft, Electric Service Centract 17 6/29/18 Craft Interchange 7peetent 14 G -STIC/.w r 7/17M3 Ltr. Rtson O.urchill 1 w/ene. draft interchange agreement 13 dated (7/7/78) 7/21M8 " CPL Ceaft, Interchange A;;mt" 17 1/5MS Ltr. Pettinos Ham 1 Mabe i

Pokceny West j

Wimberley k

2/358 Ltr. 1 11/30M7 Ler . Posten Ek:rchelt 2 Grcss Eancock Si. mens Scderberg i

4 9 1

0' L f

)O^W A Vel =e V: .

s A\didu La Festen C::ffman 1 2/9/78 Ltr.

Meader 2 w/att.

Tanner Taylor m .d 3/6/78 Ltr. Pettinos Sr.ssinger 1 Foster ,

4/5MS Ler. " 1

" " l S/4/7S Ltr.

" " 1 7/3/78 Ltr.

N.D. Craft Mtg. betwen Macke and Park 3 and Gecss and Payet*J N.D. Bate Sch. CPSB Fconcmy Ehergy 3 N.D. Bate Sch. GSB Short-term 3 Firm Power 7/6BS Ltr . Icsten Gecssn 1 w/att. 3 9/1/78 Ltr. Sct: Bassinger 1 12/1/73 Ltr . Set: Bassinger 1 N.D. h=tt . S'ISC/MEC-CPS 138 kv Inter- 4 M .nection N.D. S'IEC/MIC Firm Power Purchase 28 Agmt. Q:.estiens/ksers 12/20/73 Pow r Interchange and Sale 13 Agmt. between City of San Antonic and South hxas F.lectric C:cperative/Medina Electric Cooperative 1

e

Vcle.e V* D i

l 1/22M9 Ltr . Soto Bassi.g er 1 i 11/253 Ltr. Riite Gross 2

. 9/23M4 Ltr. Siegelin Shepperd 1 l w/att. 2 l ll/19M4 Ler. Shepperd Siegelin 2 3/25M5 Ltr. Shepgerd Siegelin 1 4

N.C. !btes F1.ndwritten 6:2n SIEC files 10/26M3 Ltr. Alexander Gross 5 1

4MM6 Ltr. Shepperd Siegelin 1 I 4/9M6 Ltr. Shepgerd Hancock Grcss j 7/13M7 Ltr. STIS Idu. Si: mens 1

?t;rs & Dirs.

8/lM7 Memo Bobson 4

S/4M7 Ltr. STIS Idn. Sim::ns 1 1 w/att. STIS Cgerati.g A;=t. 3 8/31/77 S/3157 lbtes Meeting at CPL betmen 1 CPL ard STEC/MIC 11/S/77 Minutes TIS Idnin. C:2:mittee Mtg. 4 2/3/78 tbtes TIS Idnin. C:2=tittee Mtg. 4

1/23M8 A;;enda TIS /dnin. Cmmittee Mtg. 1 2-3 Feb. , 1978 N.C. Ibtes A&dn. Cmmittee Mtg. 1 12/9/69 Minutes STEC-MEC M;;

nt. Cmmittee 4 w/att.

2/lsMs Ler. smie. TIS ;da. 2

\bl=e \~

l L=. T.ece Pettines 1 1/19BS L=. Sirmens TIS Ain. 8 1/2358 7 w/att.

TIS ASn. 3 1/2758 Memo Coffr.an 1

w/att. Tanner Taylor Cazents by "W.R." of IGA 8 2/2MS re: TIS W.eeling Policy Lage Taylor 2 5/1255 Ltr.

l t

Gross Poston 3 3/5M4 Memo Borchelt J Alexander 7/2657 Ltr. Geess Jeslin 1 Poston Geess 1 5/6M5 Ltr.

Myers M elland 1 9M/62 Ir.r .

9/6M2 Ltr . McClelland Medina nec. 1 Cocp.

5/11/61 Ltr . Shepeerd teely 1 teely Matthews 1 5/9/61 Ltr.

Hughes Ibrton 2 6/26/64 Ltr.

L.E. Frances 1 N.D. 2tes Maierhofer Gross 2 S/13/64 Ltr.

1 w/att.

L.E.G. 1 5/2/66 Memo .Ters Meyers Slaughter 1 5/2/66 Ltr.

4

l QO O D D ~3~ Vg co o b b . .k iru o

%i=e C 9/12/67 Lc. Geess Maierhofer 2 1 w/att.  !

3MB3 Me:re L::ngeria Jinnette 2 w/att. 1 9/23M7 Ler. Tanner E3Cor 15 w/att.

1/19/76 L r. Repeerd Gross 7 w/att. 1 Centract Necctiatien 1/25/80 Ltr. R:endtree C alker 4 2/15/80 Ltr. Borchelt Fcundtree General 1979 National F.lectric Feliability Ccencil Arc.:al Peper:

1975 Natienal Electric Feliability Ccuncil Annual Peport Econcrw D.er=v Purchases frem San Antonio 5M9 L r. Scto Bassinger 1 4/6M9 Ltr. Scto Bassinger 1 3MB9 Ltr. Soto Bassinger 1 l

~

-r-

Eccccev E

er=v 5* TPL to TIS Merbers 3/2959 Ltr. IcVelers Baum 1 2/2SM9 Ltr. l i ,

1/29M9 Ltr. 1 '

i i 5/1M9 Ltr. l j 1

i 5/2259 Ltr.

" 1 11/6M9 Ltr . Mundtree Spence 3 l

4 Transmissien *a PCB l l

2M/SO Ltr. Borchelt kendtree 1 l STP Particitatien 2/6/80 Ltr. Gawlik Ms'en 1 i

Joint Particitatien _

6/13M9 Ltr. Billipse mundtree 2 )

7/24M9 Ltr. Mundtree krchelt 2 9/13M9 Ltr. Brennick krchelt 1 a

' 9M9 Criteria for Particitation 2 10/25M9 Ltr. Foundtree millips 4 ll/2SM9 Ltr. Mundtree millips 1 12/18M9 Ltr. M:Cennell Spiegel 2 Trans:-issien Limitatiens 9/2SM9 Gawlik Price 1 l

10/23M8 Nundtree Price 2 i

. =

Ol

-i-4 l

E ,/GL Centracts

! 12/14/71 Cen=act E3/CE mwr Parchase ;c=t. 16 I

3/25/30 Centract ET/CM.,Intercennecticn K i

i i

General N.C. .ap w Service area of E'S E3 Pcwer Parchases j 5/21/79 Ltr. kundtree Wall 1 l Hardy 3 1

4 " " "

Herring 1 kbson 1 Spruce 1 Envidsen 1 Chalker 1 Austin 1 l

MM 1 Crawford 1 1

Edgers 1 Paillips 1 i

1 l

1 9

%9 0 D k

'blu e 'c w $ Ju 6 - - #

CA"'E SPE FFCM g Paces I.D. #

3ackereund Acreenents 7/153 1gmt.

South h as Project Particiaption Scat.

+ ;mendment 1 (12/1/73)

+ Amendment 2 (3/1/75)

N.C. Iqmt. South has Project CP 30032275-64 345 kv Transmission

! Lines ;greement 12/359 CSN Svstem hansmission 9 Service Pate Guidelines 9/552 ;gmt. Escor ; gree: rent 14

5S9 ;g=t. STIS C?:erating ;greerent 2 + exhibits Iditting Brew.sville 5/9/79 Ltr. Ibsten STIS ddm.

5/67 ;cmt. TIS Cocedination Ismt.

as amended 8/31/77 TIS C?:erating Chides 7/2656 Ltr. Smith Taylor 8 CP B0007342-47 (enciesing TIS tans:rdssion Facilities Pelicy Guidelines) 12/157 Study Stagg " Generation and 12 Suma7 tansmissien Plannirs Study of the Electric Facilities of I the Electric Beliability Council of hxas" 12/1/77 Study 108

\bl=e VI f.

12/17/79 Study Stagg "Ecenamic Evaluation 69 ef Alternative Gcneration Expansion Plans Sr Electric Reliability Council of W.xas aM Southwest Power Pool" 12/17M9 Study " "

205 + exhibits 5/30 Study Depart:mnt of D.ergy 90 + att.

" Electricity Exchanges:

United States / Mexico 1979 Study Burns & McDonnell "1975' 1984 Capital Imprevement P:cgram - Ecwr Supply -

Public Utilities R:ad.

3MS Study  ::.4 " Staff Repert on Electric Reliability Council of "Jexas Inteme.ection aM Paliability Evaluation" 7/10M5 Ltr. Oxlahy Falecne 16 84394-409 5/4M6 Pleading Ferguson 9 + exhibits

" Petition aM Application of  ;

Central Pcuer and Light 1 Cx.pany and ethers Sr 1 Proceedings Prstant to I Sections 202(a) and 202(b) i of the Federal Pcwr kt" FERC QDcket No. E-9558 1M7 Pleading Petitlen to Intervene of i CP&L et al., FERC C3cket No. E-9578 4/3/64 Memo Eall MacGreger 2 5/23/64 Ltr . Hofmokel Brownsville 2 e

i l

Velme V:

5/23/64 Ler. n::frckel Fall 2 4/24/54 Mere Bar:.ard PCB 5 4/15/64 " Prop:: sal to Public Utilities Feard, 2 City of Brownsville, Texas" by Rio Grande Valley Gas Q:mpany S/6/64 L r. Hall refmekel 3 5/26/64 Fardwritten Notes 4 5/2S/64 Fandwritten &tes 5/22/64 Ltr. Edelstein Fall 3 Ba m.d 3/15/64 Ltr. 2ngard Jeslin 1 7/6/64 Ltr. Barnard Fall 2 5/4/64 Ltr. m gard Csborne 1 3/20/64 Me:ro Barnard R;B 2

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)

> -0 "B oo o _ S __ 'J o i UNITED STATES CF AME RICA SEFORE THE NUCLEAR REGULATORY COMMISSICN 3EFORE THE ATOMIC SAFETY AND LICENSING BOARD 1

4 j

! In the Ma::er of )

i HOUSTON LIGHTING & PCWER COMPANY ) NRC Docke t Nos . 5 0-498 A I ?t3LIC SERVICE SC.'.RD CF S AN ANTONIO ) 50-499A 4

CITY OF AUSTIN )

I CENTRAL PCNER AND LIGHT COMPANY )

j (South Ter.as Project, Unit Nos. 1 )

j anc 2) )

)

i

, TIXAS UTILITIES GENERATING ) NRC Docke t Nos . 50-4 45 A 4 wCMPANY et al.

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) 50-445A (Comanche ?eak Steam Electric )

s tation, Chits 1 and 2 )

CERTIFICATE OF SERVICE 1

1 I hereby certifv. that I have caused copies of the foregoine -

l :o be served on the following by deposit in the United States j ma il , firs t class , postage paid this 8 th day of October,1980.

i r

l l

Sheldon J. Wolf e , Esq. Marshall E. Miller, Chairman i A:0mic Safety & Licens ing Atomic Saf ety & Licensing 1 3 card Panel Board Panel j Nuclear Reg ulatory Commission Nuclear Bagulatory Commission Washington, D.C. 20555 Washington, D. C . 20555 i Michael L. Gl as e r , Esq . Fredric D. Chanania, Esq .

I 1150 17th Street, N.W. -

Michael 3. Blume , Esq.

Wa s h ing ton , D. C . 20036 Ann Hodgdon, Esq.

I Nuclear Regulatory Commission

Jercme Salt: man, Chief Washing ton , D.C . 20006

! An tit rus t & Indemnity Group

) Nuclear Regulatory Commission Robert Lowenstein, Esq.

Wash ing ton , D.C . 20555 J. A. Bouknigh t , Jr . , Esq.

j William J. Franklin, Esq.

Ch as e R. St 2phens , Chief Lowenstein, Newman, Re is ,

i Cocke ting & Service Section Axelrad & Toll l Of fice of the Secretary 1025 Connecticut Avenue N.W.

Nuclear Regulatory Commission Washing ton , D.C . 20036 Washingt:n, D.C. 20555 1

David M. Stahl , Esq.

, Sarah F. 5:1:swe ig , Esq.

Isham, *incoln & Beale 1120 Connecticut Av e nue , N. W. -

i Suite 325 Washing: n, O.C. 20036

~n.

n .

Susan 3. Cypher:, Esq. Frederick H. Rit ts , Esq.

Antitrus: Div is ion Law Of fices of Northcut: Ely Depart:ent of Justice Watergate 6 00 Building

?. O. Box 14141 Washing ton , D.C. 20037 Washington, D.C. 20444 Nheatley & Wolleson Joseph Knotts , Es q. 1112 Watergate Of fice 31dg .

Nicholas S. Reynolds , Esq. 2600 Virginia Avenue , N. W.

Decevoise & Liberman Washing ton , D.C . 20037 1200 17th Street, N. W.

Washing ton , D.C. 20036 William Sayles, Chairman and Chief Executive Of ficer Douglas . F. John, Es q. Central Power & Light Co .

McDermott, Will & Emery P.O. Box 2121 1850 Connecticut Avenue , N.W. Corpus Chris ti, Texas 78403 Washing ton , D. C . 20036 G.K. Spruce , General Manager Robert O ' Neil , Esq. City Public Service Board Mille r, Balis & O 'Neil P. O. Box 1771 776 Executive Building San Antonio, Texas 78201 1030 15 th St re e t , N. W .

Washington, D.C. 20005 Jon C. Wood, Esq.

W. Roger Wilson , Esq.

Jo seph Ru therg , Esq. Matthews, Nowlin, Macf arlane Antitrust Counsel & Barrett Nuclear Regulatory Commission 1500 Alamo National Bldg.

Washing ton , D.C. 20555 San Antonio, Texas 73205 R. L. Eancock, Dire ctor Pe rry G. Brittain , Pres ident ,

City of Austin Electric Texas Utilities Generating Co. l Utility Department 2001 3ryan Tower

?. O. Box 1088 Dallas , Texas 75201 ,

Au s t in , Texas 78767 )

Joseph I. Worsham, Esq.

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Je rry L. Earris, Esq . Merlyn D. Sam pels , Esq .

Richard C. Salough, Esq . Spencer C. Relyea , Esq.

City of Austin Wors ham , Forsythe & Sampels P. O. Box 1088 2001 Eryan Tower '

Austin, Texas 78767 Suite 2500 Dallas , Texas 75201 Don H. Dav idson  :

City Manager G. W. Oprea, Jr. l City of Austin Executive Vice President l

?. O. Box 10 88 Houston Lighting & Powe r Co . I Austin, Texas 78767 P. O. Box 1700 -

Ecuston, Texas 77001 Don R. Bu tl e r , Esq .

Sneed , Vine , Wilkerson, W. S. Robson, General Manag er Selman & Perry South Texas Electric Coop. ,

?. O. Box 1409 Inc.

Austin, Texas 78767 P. O. Box 151 Nursery, Texas 77976

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~3~ $

Morgan Hunter, Esq.

McGinnis, Lochridge & Kilgore Michael I. Miller, Esq.

900 Congress Avenue Isham, Lincoln & Beale Austin , Texas 78701 One First National Pla:a Chicago, Illinois 60603 Kevin 3. Pr at t , Esq .

} Linda Aake r, Esq. Donald Clements, Es q.

4 P. O. Box 12548 Gulf States Utilities Co.

. Capital Station P. O. Box 2 951 4

Austin, Itxas 73767 Beaumont, Texas 77074 i E. W. Barnett, Es q. Knoland J . Pluc knett Charles G. Thrash, Jr., Esq. Executive Director J. Gregory Copeland, Esq. Committee on Power for the i

Theodore F. Weis s , Jr . , Esq . Southwest, In c .

Baker & Botts 5541 Skelly Drive 3000 One Shell Plaza Tulsa, Oklahoma 74135 j Houston, Texas 77002

! Jay M. Gal t , Es q .

Somervell County Public Library Looney, Nichols , Johnson P. C. Sox 417 & Hayes

, Glen Rose , Texas 76403 219 Couch Drive Oklahoma City, Oklahoma 73101 Maynard Human, General Manager Wes tern Fa=ners Electric Coop. R. Gordon Gooch, Esq.

P. O. Box 4 29 Jo hn P . Mathis, Esq.

! Anadarko, Oklahoma 73005 Baker & Botts 1701 Pennsylvania Ave . , N.W.

James E. Monahan Washing ton , D. C . 20006 ,

Executive Vice President )

and General Manager Ro ce rt M. Rad e r , Esq.

3:azos Electric Power Coop. In c . Conner, Moore & Corber P. O. Box 6 296 1747 Pennsylvania Avenue , N. W.

Wa co , Texas 76706 Washington, D. C. 20006 1

! , W. N. Woolsey, Esq. '

Dyer and Redford i 1030 Petroleum Tower Corpus Chris ti, Texas 78474 Mr. G. Holman King

..sst Texas Utilities Co .

P. O. Box 8 41 Abilene , Texas 79604 l l

AZL -

Ron M. Landsman ~

Attorney for the Public Utilities Board of the City Octocer 3, 1980 of 3rownsville, Texas

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