ML20009B908
| ML20009B908 | |
| Person / Time | |
|---|---|
| Issue date: | 06/25/1981 |
| From: | Shapar H NRC OFFICE OF THE EXECUTIVE LEGAL DIRECTOR (OELD) |
| To: | Bradford P, Gilinsky V, Hendrie J NRC COMMISSION (OCM) |
| Shared Package | |
| ML20009B907 | List: |
| References | |
| REF-10CFR9.7, RULE-PR-51 NUDOCS 8107200003 | |
| Download: ML20009B908 (24) | |
Text
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,,C; UNITED STATES y
3 c( 3 g NUCLEAR REGULATORY COMMISSION
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aj WASHINGTON, D. C. 20555
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SUN 2 5 19 81 MEMORANDUM FOR:
Chainnan Hendrie Commissioner Gilinsky Commissioner Bradford Commissioner Ahearne FROM:
Howard K. Shapar Executive Legal Director
SUBJECT:
SECY-81-317 - SECY-81-317B - PROPOSED RULEMAKING TO ELIMIMTE NEED FOR POWER AND ALTERNATIVE ENER3Y SOURCE ISSUES IN OPERATING LICENSE PROCEEDINGS IN THE ABSENCE OF SPECIAL CIRCUMSTANCES On June 15, 1981 the General Counsel proposed and distributed for comment a1 ;ernative language for the preamble of the proposed rule prefiered by the staff in SECY-SI-317.
See SECY-81-317B.
The General Counsel noted that this approach had been discussed with the staff but that fonnal staff concurrence had not been sought.
While OELD finds portions of the OGC revision legally acceptable, for the reasons set forth below, we cannot agree with all of the proposed revisions.
(As this paper was being finalized, the staff received Comcissioner Ahearne's comments on SECY-81-317 and 81-3175; these comments reflect some, but not all, of the OELD concerns.
The staff has also received Commissioner Bradford's comments. After a preliminary review of these ccnments, I offer one observa-tion.
On page 6 of Commissioner Bradford's revision, it is recommended that language stating that the rules, if adopted, "will" apply to engoing licensing proceedings be changed to "may apply to some or all" licensing proceedings.
As a legal matter, regulations duly promulgated generally apply to pending licensing oroceedings, absent a grandfathering provision in the regulation or prejudice to the parties; this result would obtain whether or not the explicit language proposed by the staff is contained in the Federal Reaister notice. The language proposed by Commissioner Bradford seems to present an ambiguity as to the criteria which will be used to detennine the applica-bility of the rules to pending proceedings.)
The OGC revision is confusing because it seems to convey the impression that economics is the controlling factor in NRC NEPA reviews.
- See, generally, pages 4a and 5 of the OGC revisions.
This emphasis is not correct.
The Appeal Board has ruled in ALAB-458 (Midland) and other cases that under NEPA, unless the nuclear plant has envirorrnental dis-advantages in comparison to possible alternatives, differences in
Contact:
Bruce Berson, OELD 492-7678 8107200003 810709
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The Comissioners.
Although Midland was a proceed-financial cost are of little concern.
ing to determine whether the construction permits of a licensee should be suspended, the NEPA principle which supports that holding of the Appeal Board is equally applicable to operating license proceedings.
OELD disagrees with OGC's illustration on page 5 of their revision of the "special circumstances" warranting an exception to the rule pursuant to 10 CFR 2.758.
On the one hand, the illustration is too narrow by limiting special circumstances to a showing of " unusually severe The appropriate standard for an exception
, environmental impacts."
should be whether new infomation suggests unexpected and significant adverse environmental impacts from the operation of the nuclear plant On the not previously considered in the construction permit proceeding.
OGC states that a showing other hand, the illustration is too broad.
that "some other elements of the foregoing analysis are incorrect" would constitute special circumstances. The " foregoing analysis," of course, refers to the analysis in support of the proposed rule.
This goes too far by apparently pemitting challenges to the basis of the rule in every individual licensing proceeding, whether or not there exists new information which suggests unexpected and significant adverse environmental impacts not previously considered.
The time to chrilenge the basis for a rule is at the time the rule is being promulgated, not This is implicit in -12.758 in every individual case thereafter.In other words, this illustration of the itself.
See i 2.758(a).
application of the "special circumstances" waiver would in effect negate the objective of the proposed rule which is to eliminate unnecessary and duplicative consideration of need for power and alternative energy source issues at the operating license stage.
The OGC revision makes no mention of the fact that Final Environ Impact Statements issued in support of proposed licensing actions at the construction permit stage have invariably concluded that the environmental consequences of construction and operation of nuclear power plants are relatively small and that environmentally preferable Therefore, we disagree with the alternatives are not available.
statements at the bottom of page 4a and the top of page 5 of the OGC revision that the environmental consequences of nuclear and alternative fossil power sources are less quantifiable and more controversial than the economic consequences and that numerous studies have attempted to compare the environmental consequences of nuclear vs. fossil power While the statements may be correct sources with inconclusive results.
if only plant-specific impacts are examined (excluding the supporting fuel cycle), the CONAES report cited by OGC is clear that when entire Licensing fuel cycles are compared, coal is inferior to nuclear.
reviews of nuclear power plants and the comparison of alternatives must In addition, the Inhaber report obviously consider entire fuel cycles.
cited in the OGC revision is controversial from a technical point of Rather, primary reliance view and should not be referenced in the rule.
for conclusions regarding the envirormental impacts of nuclear plants 4
The Comissioners.
and reasonable alternatives thereto should be placed on the environ-nental impact statenents orepared in coniunction with license anplf-cations.
These statc<,ents have invariably concluded that the operatten of nuclear plants are environr.entally acceptable.
It is this past exrerience smich justifies, in part, the finding that the conclusions reached at the construction pen.it stage on need for power and alter-native energy sources are unlikely to change at the operating license stage.
Tn? focus of this oro.osed rule,st:ing is limited to whether need for n
power and alternative energv source issues have to be considered again at the ocerating license stage.
4:cordingly, the environnental irpacts of operation is the crucial issue (whether there has been any signifi-cant cr.ance in tne enviremental consecuences of plant onaration pre-viously analyzed at the construction permit stage).
The 00C revision uses exnansive languag.e which appears to go further than necessary.
Language on nago 5 of the revision speaks in terns of "the total environaental impacts frce nuclear and fossil-fuel plants" and "the sub-stantial econonic advantages of nuclear."
This language, if retained at all, should be redified to r.ake clear that the discussion does not relate to construction-related ratters but is liriited to the environ-rental irpacts and economics associated with the oceration of nuclear power clants.
Attached are a revised Federal Re-ister notice wtiich incorporates revisions odate these legal concerns, as well as a comparative text of wnich acco' these propc sed revisions and the OGC language contained in SECY-S1-3176
[d !ralsi i
A/. 3 - e gned m
. S d. Shapar.
Foward K. Shecar Executive Legal Director
Enclosures:
DISTRIBUTION:
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Comperctive text GHCunningham, III BASerson cc: '.
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Enclosure A NUCLEAR REGULATORY COMMISSION (10 CFR Part 51)
NEED FOR P0h'ER AND ALTERNATIVE ENERGY ISSUES IN OPERATING LICENSE PROCEEDINGS AGENCY:
Nuclear Regulatory Commission, s
ACTION:
Proposed Rule.
SUMMARY
The Nuclear Regulatory Commission (NRC), proposes to amend its regulations in 10 CFR Part 51, " Licensing and Regulatory Policy and Pro-cedures for Environmental Protection," to provide that, for NEPA purposes, need for power and alternative energy source issues will not be considered in i
operating license proceedings for nuclear power plants and need not be addressed by operating license applicants in environmental reports sub-mitted to the NRC at the operating license stage.
The NRC proposes to take this action to avoid potentially duplicative and unnecessary litiga-tion of issues previously resolved at the construction pemit stage.
l l
Comment period expires 60 days after publication in the Federal DATES:
Comments received after (insert 60 days after publication in i
Register.
the Federal Register) will be considered if it is practical to do so, but l
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assurance of consideration cannot be given except as to comments received on or before this date.
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2-ADDRESSES:
Interested persons are invited to submit written comments and suggestions on the proposal and/or the supp:rting value/ impact analysis to the Secretary of the Commission, U.S. Nuclear Regulatory Commission, Washington, D.C.
20555, Attention: Docketin; and Service Branch.
Single copies of the value/ impact analysis may be obtained on request from Darrel A. Nash, Office of State Programs, U.S. Nuclear Regulatory Commission, Washington, D.C. 20555 (Telephone: 301-492-9352).
Copies of the value/ impact analysis and of conm_nts received by the Commission may be examined and copied for a fee in the Commission's Public Document Room at 1717 H Street, N.W., Washington, D.C.
FOR FURTHER INFORMATION CONTACT:
Darrel A. Nash, Office of State programs, U.S. Nuclear Regulatory Commission, Washington, D.C. 20555 (Telephone:
301-492-9882).
SUPPLEMENTARY INFORMATION:
In accordance with the Commission's NEPA respon-sibilities, the need for the power to be generated by a proposed nuclear power plant and alternative energy sources for the generation of the power, including no additional generatinC capacity at all, are considered anc resolved in the constraction pennit proceeding associated with the proposed fecility. The construction permit proceeding is the appropriate forum in the Commission's two step licensing process for resolution of these issues.
As the Commission's Appeal Board has recognized, " absent some 'need for power,' justification for buildina a facility is problematical" (emphasis y
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added).M Alternative energy source issues are also highly relevant at the construction permit stage.
Prior to the start of construction there has been essentially no environmental disruption at the proposed site and only a relatively small capital investment has been made by the license aoplicant.
Hence, as a practical matter, at the construction permit stage, real alt'er-natives to the construction and operation of the prcposed facility exist, including no additional generating capacity at all if no "need" exists or i
generation of the needed electricity by some non-nuclear energy source.
Accordingly, need for power and alternative energy sources are often liti-gated by interested parties in construction permit proceedings.1/
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The situation is significantly different at the operating license stage, however.
This stage of the licensing process is reached only after a prior finding by the Cosnission or its adjudicatory tribunals at the construction permit stage that there existed a need for the power the proposed facility would generate and that, on balance, no superior alternative energy sources existed.
At the time of the operating license decision, construction related environmental impacts have already occurred at the site and the Me, 1/
";blic Service Company of New Hamoshire, (Seabrook Station, Units 1 &
2), ALAB-422, 6 NRC 33,90 (1977).
It should be noted that as a matter of policy the Commission endorses 2/
placing substantial reliance on State assessments of need for power, energy conservation, and alternative energy source analyses to fulfill NRC's NEPA responsibilities at the Cp stage and has requested its staff to develop procedures to solicit input from the states and the Federal Energy Regulatory Commission for use in the environmental impact state-inent and for testimony.before licensing boards in construction permit proceedings.
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construction costs have been incurred by the licensee.
The facility is essentially completely constructed and ready to operate when the Co mission's Atomic Safety and Licensing Board renders its decision on the operating license application.
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,; r Operation of a nuclear power plant entails some environmental cost which
_q should be justified, under NEPA, by some benefit from plant operation.
In all cases to date, and in all foreseeable future cases, there will be some benefit in terms of either meeting increased energy needs or replacing older less economical or less environmentally advantageous generating capacity.
hperience shows that completed plants are in fact used for either purpose and licensees authorized to operate such plants do, in fact, operate them to the maximum extent of their availability to produce electricity.
Such facilities are not abandoned in favor of some other means of generating electricity.
For purposes of this proposed rule the Commission has assumed, conservatively, that the plant is not needed to satisfy increased energy needs, but ra',her is justified, if at all, as a substitute for other gener-ating capaci;y.
The benefits derived by this " substitution theory" have been upheld in several cases as justification for construction and opera-tion of nuclear-generated units by the Commission's Appeal Board.
E.G.,
Niacara Mohawk Power Corporation _ (Nine Mile Point Nuclear Station, Unit 2),
ALAS-264,1 NRC 347 (April 8,1975).
NEPA also requires the Commission to consider alternatives to the proposed This is not to say that need for power and alternative energy source action.
l
-S-issues previously considered in the construction pemit proceed,ing need be On the contrary,! judicial reconsidered at the operating license stage.
precedent makes clear that NEPA does not require the Commission to duplicate at the operating license stage its review of alternatives absent new infoma-tion or new de.alopments.
Calvert Cliffs' Coordinatin'a Comittee, Inc. v.
A.E.C., 449 F.2d 1109, 1128 (D.C. Cir. 1971).
Uniofi of Concerned Scientists v, A.E.C., 499 F.2d 1069, 1079 (D.C. Cit. 1974).
As noted earlier, at the time the operating license stage has been reached, the Commission or its adjudicatory tribunals have already detemined that, on balance, no superior alternative energy source exists.
These findings have been made by the Com-mission in construction pemit cases since the Calvert Cliffs' decision and are documented in the Final Environmental Statement and adjudicatory decisions issued at the construction permit stage.
Moreover, the environment 11 conse-quences of the proposed plant, both as to the impact of construction and of f
operation, have been found to be small relative to the benefits expected from
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Absent some new the availability and yperation of the nuclear facility.
infomation showing unexpected and significant adverse environmental impacts associated with th'e operation of the constructed nuclear facility which have
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not been previo0 sly considered, or new developments showing the availablity
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of an alternative energy source not previously considered which could provide
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the needed power in an environmentally superior manner, the Comission cannot
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readily' conceive of a situation in which the prior conclusions could be changed and' he NEPA cost-henefit balance tipped against issuance of the operating
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In fact,,there has never been a showing in a Commission operating l'i cens e.
a e,
license proceeding that a viable environmentally superior alternative to
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operation of the nuclear facility exists, although time and resources have been spent litigating alternatives to operation which, typically, had been
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previously decided at the construction perr.it stage.
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- j Unless the nuclear plant has environmental disadvantages in comparicon to 5
reasonable alternatives, differences in financial cost are of little concern
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But if there are available alternatives which would.
l in the NEPA process.
1 result in lesser adverse environmental impact than the nuclear plant, then, of course, c.ost-benefit balancinc ircluding financial cost factors wauld assist in reaching a reasoned decision, including the possibility of not j.
allcwing the operation of the nuclear plant.
See Consumers Power Comoany (Midland Plant, Units 1 and 2), ALA3-458, 7 NP,C 155,161-163 (1978).3_/
Hence it is only after an environmentally superior alternative has been identified that economic considerations become relevant.
In the specific context of a
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alternative energy source issues in operating license proceedi:.gs, the NEPA If one does issue is whether an environmentally superior alternative exists.
If an environmen-not exist, then economic considerations are not relevant.
tally superior alternative does exist, then economic considerations are con-sidered in the cost-benefit balance and may offset environmental disadvantages.
l However, even if the existence of an environmentally superior alternative is alleged 'a exist at the operating license stage, reports available to the That case involved a proceeding to determine whether the construction 3/
pemits of a 1.icensee should be suspended in light of a judicial remand.
j-However, the NEPA principle involved is equally applicable to operating
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license proceedings.
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Commission show that the economic costs of operating completed nuclear power plants are clearly below the operating costs of other available methods of baseload fossil generation.4/
See Steam-Electric Plant Construction Cost
& Annual Production Exoenses - 1978, December 1980, DOE /EI A-0033(78); Draf t
.;gh Environmental Statement Relatina to the Operation of Grand Gulf Nuclear Station Units 1 & 2, NUREG-0777, May,1981, pp. 2-1 to 3-1; Cost & Ouality of Fuels for Electric Utility Plants - December 1980, 00E/EIA-0075 (E3/12).
Therefore, given the substantial economic advantages to operating nuclear plants, the Commission believes that even an alternative which is shown to be marginally environmentally superior in comparison to operation of 2.
a ' nuclear facility is unlikely to tip the NEPA cost-benefit balance against issuance of the operating license.
In making the above economic evaluations, the Commission makes the assumption that in the event a completed nuclear power plant is not licensed, the costs of the capital investment involved
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will eventually be paid by the utility's ratepayers.
Depending on plant-
.c Jy specific conditions and state regulatory decisions, a utility burdened with a fully-built but unusable plant would ultimately have to recover the This would occur either directly
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costs of construction from ratepayers.
if
'. E through rate increases or indirectly by the utility being forced to pay a
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substantially higher rate of interest on its bonds in order to attract understandably cautious investors.
These higher interest rates would in turn be reflected in higher rates charged to the utility's customers.
l Hydroelectric plants, which would rarely, if ever, be shut down in lieu 4/
of a new nuclear plant, can be operated at a lower cost than nuclear
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plants.
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s Therefore, based on all of the above, the Comission believes that case-specific need for power and alternative energy source evaluations need not be included in the environnental evaluation for a particular nuclear power plant operating license since new infomation or new developments concerning such jh issues are unlikely to tip the NEPA cost-benefit balance against issuance of the operating license.
An exception would be made to this rule if, in a particular case, special circumstances are shown in accordance with 10 CFR
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E 2.758 of the Commission's regulations.
Such special circumstances could exist if, for example, it could be shown that nuclear plant operations would entail unexpected and significant adverse environmental impacts which had not
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been previously considered.
Accordingly, the Commission proposes to amend its regulations in 10 CFR n:1.
Part 51 to provide that need for power and alternative energy source issues will not be considered in operating license proceedings for nuclear power
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plants and need no+. be addressed by operating license applicants in environ-Tb mental reports submitted to the NRC at the operating license stage.N An ivf Promulgation of these proposed rules in final fom is not inconsistent 5/
with the Commission's earlier denial of a petition Sr rulemaking, PRM-51-4, submitted by Boston Edison Company, et al.
See 45 FR 10492 (February 15,1980). That petition would have excluded consideration of such matters as need for power, alternative sites, and alternative The denial of the energy sources at the operating license stage.
petition was grounded largely on the petitioners' erroneous and overly narrow assumptien concerning the scope of an operating license. safety review.
However, the Commission specifically noted in the denial that it might be possible to limit the NEPA review at '.ne OL stage to new infomation of significance to the ultimate decision on the proposed action.
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exception to or waiver of the rule, if adopted, would be permitted in par-ticular cases if special circumstances are shown in accordance with 10 CFR 2.758 of the Commission's regulations, " Consideration of Commission rules and regulations in adjudicatory proceedings."
The rules, if adopted in
- b final form, will apply to ongoing licensing proceedings then pending and to
'h issues or contentions therein.
Regulatory Flexibility Certification
.)
In accordance with the Regulatory Flexibility Act of 1980, 5. U.S.C.
b 9605(b), the Commission hereby certifies that this proposed rule will not, i
if adopted, have a significant economic impact on a substantial number of small entities.
The proposed rule eliminates certain reporting requirements 4
M for owners of nuclear power plants licensed pursuant to Sections 103 and
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.4-Owners of
.li$d 104b of the Atomic Energy Act, as amended, 42 !!.S.C. 2133, 2134b.
. 1C nuclear power plants are not within the definition of small business found
- fr n Section 3 of the Small Business Act,15 U.S.C. 5632, or within the Small
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' l'S Business Size Standards set forth in 13 CFR Part 121.
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Paperwork Reduction Act Statement Pursuant to the provisions of the Paperwork Reduction Act of 1980 (Pub. L.96-511), the !!DC has made a preliminary determination that this proposed This rule does not niipe,e new reporting or recordketging requirements.
proposed rule has nevertheless been submitted to the Office of Kanagement c
.__,n
and Budget for its consideration of any potential or new reporting or recordkeeping requirements, pursuant to Pub. L.96-511.
Pursuant to the Atomic Energy Act of 1954, as amended, the National Environ-
'[
mental Policy Act, of 1969, as amended, the Energy Reorganization Act of 1974, as amended, and Section 553 of Title 5 of the United States Code, notice is hereby given that adoption of the following amendments to 10 CFR Part 51 are contemplated:
It is proposed that 10 CFR Part 51 be amended as follows:
1.
The authority citation for Part 51 be revised to read as follows:
JE Authority:
Sec. 161h., i., o., Pub. L.83-703, 68 Stat. 948 (42 U.S.C. 2201 (h), (i), and (o)); Sec.102, Pub.
L.91-190, 83 Stat. 853 (42 U.S.C. 4332); Sec. 201, as amended, Pub. L.93-438, 88 Stat. 1242; Pub. L.
-l 94-79, 89 Stat. 413 (42 U.S.C. 5841) 2.
10 CFR 51.21 be revised to read as follows:
5 51.21 Applicant's Environmental Report - Operating License Stage.
Each applicant for a license to operate a production or utilization.
facility covered ty 5 51.5(a) shall submit with its application the
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number of copies, as specified in 5 51.40, of a separate document, to be entitled " Applicant's Environmental Report-Operating License Stage."
which discusses the same matters described in i 51.20 but only to the extent that they differ from those discussed or reflect new information A.
- J in addition to that discussed in the final environmental impact sta, -
ment prepared by the Commission in connection with the construction permit.
The " Applicant's Environmental Report-Operating License Stage" may incorporate by reference any information contained in the Appli-cant's Environmental Report or final environmental impact statement With previously prepared in connection with the construction permit.
respect to the operation of nuclear reactors, the applicant, unless otherwise required by the Commission, shall submit the " Applicant's
.a.;)
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Environmental Report-Operating License Stage" only in connection with the first licensing action that would authorize full power operation of
'~^1 the facility.
No discussion of need for oower or alternative eneray sources for the proposed olant is recuired in the reoort.*
[
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..y, Present 6 51.53 be retained and designated paragraph (a) and a new 3.
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paragraph (b) be added to read as follows:
The underscoring will be
- The underscored words are proposed to be added.
removed prior to transmittal to the Federal Register.
E u-
, 5 I 51.53 Hearings - Operating Licenses.
(b)
Presiding officers may not admit contentions proffered by any party concerning need for power or alternative energy sources for the proposed plant in operating license hearings and may not raise such issues sua soonte.
Dated at Washington, D.C. this day of
, 1981.
FOR THE NUCLEAR REGULATORY COMMISSION Samuel J. Chilk Secretary of the Commission l
l
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The facility is
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construction costs have been incurred by the licensee.
essentially ccepletely constructed and ready to operate when the Commission's Atomic Safety and Licensing Board renders its dec', ion on the operating license a pplication.
[0GC revisions begin here; delete remainder of page 4 and page 5 uo to ind
/.. '.
section.] Operation of a nuclear poiver plant entails some environmental cost
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which should be justified, under NEPA, by some benefit from plant operation.
In all cases to date, and in all foreseeable future cases, there will be some benefit in terms of either meeting increased energy needs or replacing older less econarical or less environmentally advantageous generating capacity.
Experience sho.<s that completed plants are in fact used for either purpose and licensees authorized to coerate such clants do, in fact, operate them Such facilities
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the maximum extent of their availability to croduce electricity.
. :.cd
~ 'W are not abandoned in favor of some other means of cene l'd For purposes of this proposed rule the Commission has assumed, J.,
that the plant is not needed to satisfy increased energy needs, but ra The justified, if at all, as a substitute for other generating capacity.
f' benefits derived by this " substitution theory" have been upheld in se cases as justification for construction and o,eration of nuclear-genera u.:: -
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I units by the Commission's Appeal Board.
E.g.JiiagaraMohawkpowerCorocration (Nine Mile Point Nuclear Station, Unit 2), ALAB-264,1 NRC 347 (
Thus,-the-cdesar.t. iregg f=p posu of-thinpreiche-4 1975).
l wkether-sene-43tece,aM+e-Fethod o?.prowi4frrq-the-aeeded-powe to - pe m.i tti rG-the-Wettd- -Meh -tee -pla n t-te - e p era te.
.,.g fl0TE :
Staff additions are underscored. Recomended deletions from OGC revisions are lined out.
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NEPA also requires the Comission to consider alternatives to the This is not to say that need for power and alternative energy action.
source issues previously considered in the construction permit On the contrary,_
need be reconsidered at the operating license stage.
judicial precedent makes clear that NEPA does not require t to duplicate at the operating license stage its review of alternatives Calvert Cliffs' Coordinatine_
absent new information or new developents._
Union of_
Co=ittee, Inc. v. A.E.C., 349 F.2d 1109,1128 (D.C. Cir.1971).
As Concerned Scientists v. A.E.C._, 499 F.2d 1059,1079 (D.C. Cir.1974).
d the noted earlier, at the time the operating license stage has been reac Comission or its adjudicatory tribunals have already determined tha These findings have balance, no superior alternative energy source exists.
been made by the Comission in construction pemit cases sinc Cliffs' decision and are documented in the Final
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- Moreover, adjudicatory decisions issued at the construction pemit stage.
to the impact he environmental consequences of the proposed plant, both as h
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of construction and of operation, have been found to be sma benefits expected from the availability and opyration of the
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Absent some new information showing unexpected and s
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J t d nuclear
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ronmental impacts associated with the operation of the construc e facility which have not been previous ^y considered, or new showing the availablity of an alternative energy source no i
sidered which could provide the needed power in an enviro hich the manner, the Ccrr.ission cannot readily conceive of a situation l
tipped prior conclusions could be changed and the NEPA cost-be
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l l
w
3 In fact, there has never been a against issuance of the operating license.
showing in a Commission operating license proceeding that a viable environ-mentally superior alternative to operation of the nuclear facility exists.
although time and resources have been spent litigating alternatives to
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operation which, typically, had been previously decided at the construction permit stage.
Unless the nuclear plant has environmental disadvantages in comparison to reasonable alternatives, differences in financial cost are of little concern But if there are available alternatives which would in the NEPA process.
result in lesser adverse environmental impact than the nuclear plant, then.
of course, cost-benefit balancing including financial cost factors would
-tig assist in reaching a reassne
- datision, including the possibility of not
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- 43 2
- n allowing the operation of the nucle 0r plant.
See_ Consumers Power Company (Midland Plant, Units 1 and 2), ALAB-458, 7 NRC 155,151-1 Hence it is only after an environmentally Juperior alternative has been identified In the specific context of that economic considerations become relevant.
.l alternative energy source issues in operating license proceedings, the NEPA
-ge 4
If one does issue is whether an environmentally superior alternative exists.
If an environ-not exist, then economic considerations are not relevant.
mentally superior alternative does exist, then economic considerations are considered in the cost-benefit balance and may offset environmental disadvantages.
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4 However, even if the existence of an environmentally superior alternativ is alleced te erist et the operating license stace, reports p6f es available to the Comission show that eue-lear plents-erewse6 es er eth base &oed-fess-iv gen:r:tient - ens the e:onomic costs of h
completed nuclear power plants are clearly below the operatino W See Steam-Electric Plant available methods of baseload fossil generation A
Construction Cost 4 Annual Production Expenses - 4978, Dec 0033(78); Fir-34 Sceok=^t-te-Re-Firrai-Eny-f Emenul-state:
Goeshesien<f Mk^s-Ceeek41ecka~3ene-etine-Gte FEMFMed-Seueces-c4-ted-av pgs.-5de.- G3-2&, Draf t Env 49A37 Statement F, elating to the Operation of Grand Gulf Huclear
}_2_, NUP.EG-0777, May,1951, pp. 2-1 to 3-1; Cost and 1
for Electric Utility Plants - December 1980, DOE /EIA,0078 (80/12.
Therefore, given the substantial economic advantaces to operati plants, the Commission believes that even an alternative whic f
to be marginally environmentally superior in co.carison to operation a nuclear facility is unlikely to tip the NEPA cost-benefit balance In making the above economic evaluations, c.
issuance of the operating license.
l the Commission makes the assumption that in the event a comple l
d power plant is not licensed, the costs of the capital investmen Depending on plant-will eventually be paid by the utility's ratepayers.
specific conditions and state regulatory decitinns. a utility b likely-retire the plant early -
with a fully-built but unusable plant w:uld d
Hydroelectric plants, which would rarely, if ever, be d t d at a lower w #I shut down_ in lieu of a new power nuclear plant, can be opera e cost than nuclear plants.
5 in-whieh-case ratepayers-weuid-uitirately bear-the-cests-of seastewetten-utimacely have to recover the costs of construction from ratecayers.
En-any eases the utility would likely-be This would occur either directly throuch rate ir. creases or indirectly by the utili:y beine forced to pay a substantially higher rate of interest on its bonds in order to attract understandably cautious investors.
These higher interest rates would in turn be reflected in higher rates charged to the utility's customers.
'n-shoct, che Co:7.ission concludes -thair $n -any - sascrably foreseeable fu-tuee-r there v:owld-be substant,ai, econo?ic adveWs-te operation-of the -
case completed nuclear plaa.t- - Given-this,- the cei-ticel-question ender HEPA-is whether these etenmic benefits-are-oMset by envincmentat disadvantages.
T-he enviFoamental conseqwecces-of <1uc're.v -and -e'rterreative-fessii power sewees are 1-ess-qwast4 f4 able and noce-contnover-stat than-the-esono=.f e consequences. - Numero stwdies ha+ e-atteTpted to-tempare-these-ocesetzences-yth -inconths-ive-resc See_ 'Enerce to -Transition 1985-2010,- rinsi-Re:rort ef-the-Cemittee on *cie Alternative.Ener-cy Systems,-Nationa4 -Resetrch Goeneil,-1975 {00RAES -Rep Werbert inhate-r,- Ris k-of Enerey-Product-ion,- Atomic-Energy Contrei '3ctrd s 4th Edition,- 0ttaw_,- Genede.
GiYen thtt-the-ecog 3*.it-advantage 3 Cf-UtiihiTG E COCpleted huthEr "p outwei h-the-use-o-f-a'rternative-fessii-fueltd 7 amts; the relat4ve envkome 1
5 costs and be,ne. fits. ata only.-impsrtaat-icscfer-as -they would be-so irrge -es to tip the talance against-licensing-a-ccmpleted-p1att.- Based on-the 4todie-e
6 have been done. on compaPative-envirenmentel-fegaett, we are prepered-to -state tha t-tbe-total-envi r.onmecta'r impacts frcs nuciete and fossil-fired piamts are st least-co f a.rable -in tems ef-beth the egnitude -and-the uncerta4nty-of-enviren-tectal impacts.- Givea -thit,-and-g(ven the -substaovial -eeOncmic edvanteges ef-cuclear, it follcws -that absent-some unusvally -seve-re environmental 4mpact from-nuclear plant operaticas,-a NEPA analysis-wou;d-favor nuclear plant operetions.-
Therefore, based on all of the above, the Com.ission believes that case-specific need for power and alternative energy source evaluations need not be included in the environmental evaluation for a particular nuclear power plant operatir; license since nes information or naw developnents concerning such issues are unlikely to tip the NEPA cost-benefic balance against issuance of the operating license.
An exception would be made to this rule if, in a particular case, special circumstances are shown in accordance with 10 CFR 5 2.75S of the Commiss, ion's regulations.
Such special circumstances could wewid exist if, for example, it could be shown that nuclear plant operations would i
f entail wnwswa!;y-severe-e9vivenreestai-ieparts-er-thats-fer-ssse.-unuseal-reases, seFe-etheF-ele =eRis-ef-the-fereeeing-analysis-are-iReerrest unexpected and significant adverse environmental impacts which had not been previously considered. (End of OGC revision) l l
l
l OGC CHANGES TR RESPONSE TO JUNE 25 ELD MEMORANDUM ARE UNDERLTNED AND LINED OUT FOR NEW PAGES 5 AND 6:
issues previously considered in the construction permit proceeding need be reconsidered at the operating license stage.
On the contrary, judicial precedent makes clear that NEPA does not require the Commission to duplicate at the operating license stage its review of alternatives absent new informa-tion or new developments.
Calve-t Cliffs' Coordinating Committee, Inc. v.
A.E.C., 449 F.2d 1109,1128 (D.C. Cir.1971).
- v. A.E.C., 499 F.2d 10691079 (D.C. Cir.1974).
As noted earlier, at the time the operating license stage has been reached, the Commission or its adjudicatory tribunals have already determined that, on balance, no uperior alternative energy source exists.
Moreover, the environmental consequences of the proposed plant, both as to the impact of construction and of operation, have been found to be small relative to the benefits expected from the availability and operation of the nuclear facility.
These findings have been made by the Commission in construction permit cases since the Calvert Cliffs' decision and are documented in the Final Environmental Statement and adjudicatory decisions issued at the construction permit stage.
Absent-se.e-new-information-shewing-unexpected-end-significant-sdverse-envirenmentsi-impacts associated-w4 th-the-ere ra ti e n-ef-the-cens tre ete d-ne ci e s r-fe eii i ty-whi ch-h a v e-not-be en--
prev 4ews4y-eens4dered -er-new-develepments-shewing-the-ava44 ability-ef-an-3 alternative-energy-seuree-net-prev 4eusly-eensidered-whfeh-eesid-previde-the-needed-pewer-4n-an-envivenmenta44y-superier-mannerg-the-EeRM4ssien-e3nnet-readily-eenee4ve-ef-a-situatien-in-wh4eh-the-prier-cenelusiens-eenid-be-s h a n ge d - a n d-th e-N Ep A-e e s t-be n e f44-bal a n e e-t4 p pe d - a g a 4 n s t-4 s s u a n e e-e f-th e-eperating-44 sense, in-fast, Moreover, there has never been a shewing finding in a Commission operating license proceeding that a viable environmentally superior alternative to operation of the nuclear facility exists, although 5
substantial time and resources have been spent litigating alternatives to operation which, typically, had been previously decided at the construction pemit stage.
Past exoerience in conductino NEPA revhws suggests, therefore, that rarely, if ever, will an alternative eneroy source, including use of an existing fossil-fired unit as substitute for the nuclear olant, be found environmentally suoerior to the nuclear olant.
Unless the nuclear plant has environmental disadvantages in comparison to reasonable alternatives, differences in financial cost are of little concern in the NEPA process.
But if there are available alternatives which would result in lesse: " erse environmental impact than the nuclear plant, then, of course, cost-benefit balancing including financial cost factors wculd assist in reaching a reasoned decision, including the possibility of not allowing the operation of the nuclear plant.
See Consumers Power Comoany (Midland Plant, Units 1 and 2), ALAB-458, 7 NRC 155,161-163 (1978). 3/
Hence it is only after an environmentally superior alternative has been identified that economic considerations become relevant.
In the specific context of alternative energy source issues in operating license proceedings, the NEPA issue is whether an environmentally superior alternative exists.
If one does not exis', then economic considerations are not relevant.
If an environmentally superior alternative does exists, then economic considerations are considered in the cost-benefit balance and may offset environmental disadvantages.
However, even if the existence of an environmentally superior alternative is alleged to exist at the opterating license stage, reports available to the
--3/
That case involved a proceeding to determine whether the construc-tion pemits of a licersee should be suspended in light of a judicial remand.
However, the NEPA principle involved is equally applicable to operating license proceedings.
6
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ADVANCED COPY TO:
Q DATE:
JULY 9, 1981 g
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Attached are the PDR copies of a Commission meetina transcript /s/ and related meeting document /s/.
They are being forwarded for entry on the Daily Accession g
List and placement in the Public Document Room.
No p
other distribution is requested or required.
Existing Q
DCS identification numbers are listed on the individual g
documents wherever possible.
1.
Transcript of:
Affirmation Session 81-27, July 9, 1981.
(1 copy)
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a.
Memo from H.
Shapar, ELD, to the Commissioners dated June 25, 1981, Subj:
SECY-81-317, SECY-81-317B -
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[a Proposed Rulemaking to Eliminate Need for Power and b
Alternative Energy-Source Issues in Operating License eg_
Proceedings in the Absence of Special Circumstances.
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