ML20030E059
| ML20030E059 | |
| Person / Time | |
|---|---|
| Site: | Susquehanna  |
| Issue date: | 09/15/1981 |
| From: | Prasad R ARGONNE NATIONAL LABORATORY |
| To: | |
| Shared Package | |
| ML20030E021 | List: |
| References | |
| ISSUANCES-OL, NUDOCS 8109170364 | |
| Download: ML20030E059 (8) | |
Text
_
9/15/81 s
UNITd0 STATES OF AMERICA HUCLEAR REGULATORY COMMISSION BEFORd THE ATOMIC SAFETY AND LICENSING BOARD In the Matter of PdN:4SYLVAMIA POWER AND LIGHT C0.
)
Docket Nos. 50-387 0.L.
AND
)
50-388 0.L.
ALLEGiii.iY ELdCTRIC COOPERATIVE, INC.
)
)
(Susquehanna Steam Electric Station,
)
Units 1 and 2)
)
TESTIMONY OF RAGHAW PRASAD flELATING TO NEE 1 COR POWER (Contention 4) 1.
I am an Economist with the Environmental Impact Studies Division of the Argonne National Laboratory at Argonne, Illinois. My responsibilities consist of financial evaluation, cost-benefit analysis, analyzing the demand and supply of different energy sources, and transport network analysis, as part of the preparation of environmental impact statements.
2.
I have read Contention 4.
My testimony covers the points raised in Contention 4, that is, the benefit to be derived from operation of the Susquehanna facility and alternatives to operation of the Susquehanna facility.
3.
Contention 4 asserts that there is no need for the electricity to be generated by the Susquehanna facility due to Applicants' high reserve margins and to the ootential for very low growth in demand for electricity and thus electrical energy requirements. The underlying premise of this contention is that the NRC Staff's 8109170364 810915 PDR ADOCK 05000387 PDR
. determination of the benefit to be derived from operation of the Susquehanna facility is limited to a finding that the facility is needed because the electricity it will g?nerate, if licensed, will enhance reliability of supply of electricity to Applicants' customers or because it will satisfy growth of electrical energy requirements. The Staff's determination of benefit is not limited to conclusions regarding reliability or growtn in electrical energy requirements as alic ad in the contentidn. The FES-OL concluded that the benefit to be derived from operation of the Susquehanna facility is the assurance of a low cost supply of electrical energy tnrough minimization of production costs. More specifically, substantial economic savings will be gained by substitution of the electricity to be generated by the facility for electricity generated by more exoensive generating units avai. Table to Applicants.
FES-OL, ls 7.3 and 7.3.2.
4-Contention 4 also alleges that conservation and solar energy should be considered as alternatives to aperation of the Susquehanna l
l l
I I
i l
l
fccility. The FES-OL concludes that the only reasonable alternative to the proposed action of granting an operating license for the Susquehanna facility available for consideration at the operating license stage is denying the license for operation of the facility and thereby not permitting the constructed nuclear facility to be added to the applicant's. generating system.
FES-OL, 1 7.4.
Alternatives such as construction at alternative sites, extensive station modification, or construction of facilities utilizing different energy sources would each require additional construction activity with it accompanying economic and environmental costs, whereas operation of the already constructed plant would not create these costs.
Furthermore, even if increased conservation savings and additional solar applications could be achieved without additional construction costs, it would still be unreasonable to deny an operating license for the Susquehanna facility because any resultant reduction in demand would not displace the need for the facility as a substitute for less economical generating uaits.
I will demonstrate tnis last point on pages four through seven of my tes timony.
_ _ _. ~, _ _ - - - -.,.. ~
t 5.
Given this factual background, it is not readily conceivable that an alleged reduction in the need for power to supply growth in electrical energy requirements or new developments concerning alternative energy sources, in and of themselves, could result in the denial of an operating license because such a result would be unreasonable. This result would be reasonable only if there had been some significant chcnge in (or newly discovered) information concerning the public health and safety or environmental impacts associated with operation of the FES. No such concerns have been revealed with regard to cperation of the Susquehanna fasility.
FES-OL, s 7.4.
6.
As stated in the FES-0L, the benefit to be derived from cperation of the Susquehanna facility is substitutien of the elec*.ricity to be generated by it for electricity generated by less economical generating units available to Applicants.
I can demonstrate that operation of the Susquehanna facility will result in a net benefit
~
even under the conditions alleged by Intervenors in Centention 4.
t
(
I nave therefore assumed that Applicants' system has excess capacity, low energy growth, increased conservation savings, and additional i
solar applications as alleged in Contention 4.
7.
An examination of the capacity currently (1981) available to PP&L and the PJi1 interchange shows that only about 2 percent and 23 I
i
.. _ -. _. ~,
- percent of tneir respective capacities can generate electricity at an equivalent or lower cost to the Susquehanna facility.M This capacity represents hydro and other nuclear units on these systems. The rcmaining 98 percent of PP&L's capacity burns either coal (64 percent) or oil (34 percent), while the remain qg 77 d
percent of PJM's capacity is dependent on either coal, oil, or combustion turbines (oil and gas) in the following proportions:
34 percent, 26 percent, and 17 percent.U This strong dependence on fossil fuels shows that if Susquehanna were not operating, replacement enes jy would have to be forthcoming from more expensive fossil fuels.
8.
Tne exact source of replacement energy is not something one can readily predict. Logically, the utility will rely ;;pon the least expensive alternative available.
For _the purpose of this assessment, I have assumed that all replacement energy will be made-up by capacity already on tne PJM system. Further, to accommodate the contentice's allegations of low demand and excess capacity, I have assumed that PJM will nave underutilized coal l
y U.S. Nuclear Regulatory Commission, Final Environmental Statement related to the Operation of Susquenanna Steam Electric Station, Units 1 and 2, NUREG-0564, Tables 7.4 and 7.5, June 1981.
l y
Ibid.
7-occur over a period of approximately 30 years, cor esponding to the estimatel useful life of the Susquehanna facility. These savings would be ekpected to ir. crease in subsequent years because even if equivalent escalation were assumed for coal and nuclear fuel, the escalation is being applied te a larger base value in the case of coal relative to nuclear.
10.
A similar analysis was recently prepared by the U.S. Department of Energy's Division of Power Supply and Reliability. / Its estimated replacement fuel cost for Susquehanna Unit lin 1982 is $13.5 million per month (S162 million on an annual basis) and reflects equal portions of replacement ener gy coming from oil and coal. The DOE results are based on an independent analysis prepared by that office. My analysis assumes unusually low energy demand on the PJM interchange such that the marginal cost energy source is shif ted from an oil / coal mix to a total reliance on coal.
In either case, significant benefits are to be derived by having the units available for operation.
7/
Estimates of the Costs of Delaying Operating Licenses for Nuclear Plants, Division of Power Supply and Reliability, U.S. Department of Energy, May 15,1981..... Included in URC's Monthly Report to Congress.
e-
+
-.y,.
...m.
. n f. y
.w.,-
+.y7,,,...g,
-s-.
-mr-
PROFESSIONAL QUALIFICATIONS Raghaw Prasad l
Argonne National Laboratory
<=
I am an Economist with the Environmental Impact Studies Division of theMy r Argonne National Laboratory at Argonne, Illinois.
l of financial evaluation, cost-benefit analysis, analyzing the demand and supp y
"~
f the of different energy resourws, c::d transport network analysis, as part oI joined the Div preparation of environmental impact statements.1979, and since have p as s tatements.
I have a Bachelor of Science degree (1961) in Electrical Engineering from
)
Ranchi University, India, a Master cf Business Administration degree (1973, a Master of Arts (1977) in Economics, and a Ph.D. Candidacy in Economics from My dissertation topic is " Evaluation of Time-I Temple University, Philadelphia.of-day and Lifeline Rate Structures and Estima have completed all requirements of a Ph.D. degree.
My respon-From 1961 to 1970, I worked as an operations research analyst.
sibilities involved production scheduling, inventory control, cash management.
and capital budgeting.
From 1971 to 1973, I was a consultant at a comunity mental health center, I directed a p-ogram which utilized Albert Einstein Hospital, Philadelphia. Eastern chilosophy, yoga, and medita mental and physical problems.
a senior systems analyst with Combustion Engineering I developed and managed a From 1973 to 1974, I r :
Refractory Division at Valley Forge, Pennsylvania.
Management Information System, and Business Planning Model.
From 1974 to 1977, I worked as a senior systems planner with Sperry Univac,
,evel-As a part of my responsibilities I designed anu f
oped a financial and accounting inventory control system to handle the flow Blue Bell, Pennsylvania.
computer parts to and from their subsidiaries located throughout the world.
From 1977 to 1978, I was employed as a senior economist with General Pu My responsibilities included development of residential d
and industrial electricity demand models, regional economic impact analyses an Utilities, New Jersey.
electricity demand forecast.
Since joining Argonne, I htve performed a number of cost-benefit analyses, financial evaluations, and energy supply and demand analyses to be incor into the environmental impact statements.
of U.S.
model for estimating the natural gas production and financial viabilit-The res Erie Natural Lake Erie Gas Development Program.
the preparation of draft environmental impact statement of U.S. LakeI Gas Development Program.
before a public hearing at Buffalo, New York.
I also developed a levelized cost model for c~aparing per unit cost of The results generation of electricity using different primary energy fuels.I also developed a m were utilized for the Pebble Springs project.
_2 evaluate the need for the Pond Hill Reservoir to supply the sonsumptive needs of Susquehanna Steam Electric Station during periods of icw river f!cw.
As a part of my responsibility in the preparation af the Northeast Regional EIS, I provided the coal supply / demand scenario to evaluate the impact of incre-mental coal demand resulting from conversion of power plants from oil to coal.
Presently, I am involved in developing a Northeast Regional Transportation Model.
I am a member of the American Economic Association.
4 m
-