ML20033C933
| ML20033C933 | |
| Person / Time | |
|---|---|
| Site: | Comanche Peak  |
| Issue date: | 12/09/1980 |
| From: | Citizens Association for Sound Energy |
| To: | |
| Shared Package | |
| ML20033C907 | List: |
| References | |
| NUDOCS 8112040507 | |
| Download: ML20033C933 (7) | |
Text
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- CASE ATTACH EIT L - PaBe 1 TRANSCRIPT OF PROCEEDINt1S f
BEFORE THE
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PUBLIC UTILITY COMMISSION OF TEXAS AUSTIN, TEXAS IN THE !!ATTER OF THE I
APPLICATION OF DALLAS X,
DOCKET NO. 3460 POWER & LIGIIT C o t1P A N Y I
FOR A RATE INCREASE I
PUBLIC HEARING ON APPLICATION TUESDAf, DECEMBER 9, 1980_
MORNING SESSION
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VOLUME'III Y
l Pages 214 to 297 9
1 1
, i I
HICKMAN-KENNEDY REPORTING SERVICE INC.
(
7800 SHOAL CREEK BOULEVARD, SulTE 346-WEST AUSTIN, TEXAS 78757 l-(512)458-3297 Offices Also At l
.N-P 0. Box 3353 Arkngton. Texas 7E010 1817)469-8930
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8112040507 81Y1i8
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vi TABLE OF CONTENTS g
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Page No.
.~y 3
PRGCEEDINGS - TUESDAY DECEMBER 9, 1980 215 g
s I
4 PRESENTATION ON BEHALF OF THE APPLICANT (cont'd) 216 I
Cross (Blanchard) 216 5
CHARLES E*.
OLSON Cross (Sparks) 230 i
Cross (Quintanilla)
.259 l
6 Cross (Joyner) 263 Cross ( r:111s )
260 7;
8 AFTERNOON SESSION 298 9
- ' CHARLES E.
OLSON Cross (continued) 299 Direct (Wooldridge) 319 i
JOE D.
KARNEY 10 '
V Cross (Blanchard) 320 f
Cross (Sparks) 330 11 Cross (Joyner) 343 Cross (Ellis) 352 12 i
Direct (Wool'dridge )
363
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13 THOMA3 L.
9 AKE.3 Cross (Blanchard) 366 Cross (Sparks) 388 i
14 f
l 15 EVENING RECESS 404 t
i 16
, y l
17 V
18 19 l
20 1
I 21 22
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l 24 1
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25 i
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h( HICKMAN KErtNEDY REPORTING S 7800 SHOAL C *EEK BOULEVARD. SUITE 346 WEST
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vez CASE ATTACE1ENT L - Page 3 270 I
Q All right.
Are you saying, then, that the increased revenues from--the increased revenues from j
2 l
c 8
because of the hot summer, have helped,.have p
3 l
- TPsL,
they not?
4 5
A Yes, as DP&L's and TESCO's to the extent they d-contributed also helped.
6 7
Q All right.
What I'm getting at is the need 8
for rate relief now.
Is this--Hasn't this alleviated '
9l part of th'e problem already?
In other words, DP&L 10 Ineeds a rate increase based on this test year, but there i
~
W-i have been factors which have come into play since the 11 12 test year which have alleviated part of that problem, i
13
'have they not?
O 14 A
No.
They haven't alleviated it.
In spite of 15 this record summer, in spite of the fact that Staff is 16 recommendi-ngra highir return on equity than has 17 probably ever been recommended for any Triple A er v
18 public utility ever in the United States, we.still 19
's e,e the common shares of Te::as Utilities r at less 20 1 than~75 percent of book value.
It's a long ways from
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21 110.
22 Q
And in spite of the fact that the--that Texas 23 Utilities revenues for the first eight months of 1980 ll increased by 23 percent and DP&L's increased by 25 24 25 percent?
h( HICKMAN-KEilNEDY REPORTING 780_ SHOAL CPEEK BOULEVARD. SUITE 346-WEST 0
Cross bc3 vicon CASE ATTACM EiT L - Page 4 274
,A In spite of all that, inflation is at record g
g 2
devels, interest rates are at record levels.
Yesterday, {
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3 southwestern Bell, a Triple A company, sold long-term 4
debt at a rate of 14.25 percent.
That's higher than t
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the returns on equity that this Commission was granting 5
l 6
a couple of years ago, and the cost of debt, obviously, 1
7 sets the floor for the return on equity, and there J.
8 is just not very much spread between 14 and a quarter 9
and 17.~
4 10 Q
So you don't think that--you don't think that V
11 this has alleviated the problem at all?
12 A
It really hasn't. Interest rates are at high
^
l I
13 levels, and if the Company is going to hiive a capital 14 attracting a rate of return that's going'to be such that-15 the shares will sell at a price equal to or, let's say, 16 1 0 percentfof book value, they have to have more than l
17 they do right now.
They just have to have more; l
w l
e 18 otherwise, it's just going to be a continued situation l
19 of selling at less than book.
20 Q
All right.
I would like to talk to you for a j
21 minute about something which was said yesterday.
I 22 believe it was when I was discussing this with 23
- Mr. Tanner.
He stated something to the effect that the i
24 sale of part of Comanche Peak does not affect the
~ Do you recall that?
ratepa*fers.
h( HICKMAN.EENNEDY REPORTING 7800 SHOAL CREEK BOULEVARD. SUITE 316-WEST
l 1
CASE A?fACHEIPf M -- Page 1 b,
, - DP84 Rate Hearings, 7/9/79, Austin Tan,ner,,. Cro s s by he M"-----
homa) 91.
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'q Mr. Saathoff.'
I wasn't sure how to pronounce
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2 it, 4
3 A
Saatiho f f.
Yes.
4 Q
Now, he appears to state at one point,in his. -,j.
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5 testimony that.Coman,che Peak will not be less expensive
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6 to run than oil and gas plants for at least the fi.rs t two g
years that they would be in service.
7 8
.You also stated earlier this morning that you 9
an ticipate Comanch'e Peak'would run at 70 percent capacity o.
l 10 af'ter the first three years.
l I
11 A
In the third' year.
Q Or in the third year.
Do you have an analysis 12 13 of what capacity that Com'anche Peak will be operating in,-
l 14 the first two years?
I.
15 A
We are planning for fuel purposes 35 percent i
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16 the first year, 50 percent the second year, and 70 percent the third. year and thereafter.
We hope that we can 17
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18 improve on that and all our objectid!Is would be to do so.
t 19 F But you plan on that and you might not have enough fuel
.i fl 1-20 sources to back it up.
j 21 Q
Okay. - So if I understand you correctly, you 22 will not have enough fuel to fully utilize Comanche Peak i
during the first two years.
Is that vhat you're saying?
23 i
24 A
To replace Comanche Peak?
25
,Q No.
To utilize it.
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CA32 A??ACILIET is - Page 2 Tanner - Croon 92 an4 1
A Oh, yes.
We do have fuel, but just examining
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coal units, you 2
wha't has occurred on nyclear units as they develop and are improved after 3
have a period where 4
they go in service.
You have a maturity period.
So.,
f 3..
5 to figure it in a conservative mode, we've calculated on '
6 35 percent the fixst year, 50, and then 70.
7 Now, we would hope to do better than 35, and 8
we have fuel to do better.
t 9
Q
' So you're just anticipating that the initial 0
10 problems you might face with bringing it on line would 11 cause you not to be able to utilize it at full capacity?
E l
A That's correct.
1 13 Q
Okay.
With regard to the studies that the r
14 Company has done on cost amounts, the benefits of 15 different programs, what studies have been done to cost 16 out the relative benefits of a delay of bringing on j
j I
k7 Omanche Peak on line in 1981 and '837 b
~~
on that 18 A
Well, we had not made any details i
j
- i 19 since around the '75 '76 period because basically we're 20 beyond the point and had so much commitments that it was 1
21 obviously not something that was economically beneficial.
I 22 I did, following rev,iew of testimony, review the delays suggested.by Mr. Nichols, and if you delay 23 that were 24 Comanche Peak-1 for two yeare., and if you look at the
~ 25 first four-year operation and then present-worth it to t
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Tanner - Crocs CASE ATP CEENT M - Page.3 g
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1981,'/it costs the customer $,25 million to delay it for an5 3
2 two years.
That's assuming we can get gas to burn and i.
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3 Proj ected gas cost.
J 4
Q Okay.
Now, do you have that analyses,--have you~
detailed that out, or is that just something out of 5
l 6
your head?
l 7
A I've scribbled it down on a piece of paper.
8 Yes.
I g
Q
' bo you have that agailable for us?
A I've got it here on some notes.
I could show
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to 11 it to you at the break or something.
12 Q
Okay.
So the last detailed analysis or
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alternative study by the; Company was in '75 '767 3l 13 14 A
I believe that was the last time.
It was one I
of the' options that we looked at seriously when we made 15 a detailed analysis of our expansion plan.
16 1
17 Q.
What was the projected growth for the Company i
4" 18 at that time?
I l
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A We were down around four percent, but at that 19{-
l 20 ' timeJwe were still having a very uncertain' gas situation; 21 Docket 600 had just come in, and we had had to anticipate 22 if Comanche Peak wasn't there it was on oil, and oil was i
23 at around twelve or fourteen at that time.
I forget just l
24 iexactly when all the changes from OPEC occurred.
But LJ very h'igh alternatives to replace 25 you were looking at some I
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CAS 4
t Tcnner kATTAhEIET M - Pby Juanits Enin (CASE) 138 rus
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Q' In regard to another q'uestion asked by Ms.
o I
glj t t O'Connor, you stated, I,believe, that there had been.no 2
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3 studies made s-inc,e the '75, ' 76 period to cost out the Is that correc't?
delay of Commanche Peak plant.
4 t
4 considered in detail.
Now, we looked' 5'
A It was not are reviewing our system expansion. plans, 6
each year--as we 7
we look at the various alternatives we could consider.
8 It was obviously one that was considered, but it was not i
one that we elected.to do.a detailed analysis on.
e Q
All right.
I believe you also stated.that at b
10 11 that time you had ca.sted out 25 million dollar costs'for
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for two years?
12 delaying n
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A I just did that here this week,'or last. week.
f 13 4
l 14 Q
All right.
You said, I believe, also that you 15 were assuming gas and projected gas coat there.
If'you i
delayed the Commanche Peak plant it would be because you l
16 1
much' load growth as had been anticipated.
{
17 did not have as s
<e 18 Is that correct?
Was this why you made the analysis, was--
a l
assumed a two year delay cn Unit 1
and 19 A
I just 1
I the three year delay on U. nit 2.. because it was suggested 20 21 by some other testimony, I just looked to see what that cost would be and I, assumed that gas would be available.
22 23 I considered the carrying cost, the O&M cost, and came up i
24 with an annual cost under those two scenarios, I present'
'y worthed it and the difference b'etween those two on a 89 FI) Q h'*
i
Ianner ASE ATTACHIEIP2 M - Page 5 C
139 Sross 1
e for a four year present worth basis is 25'million dollars I
2 t.
period.
l 3
Q All right.
Are you saying that--you are : assuming used to replace that--
4-that gas would be 5
A Generation.,
l l.[.
If the reason for delaying the 6
Q All right.
l Commanche Peak plant was that you did not nee'd'that' 7
I 8
- generating capacity, why would you need to use the--assume l
8 that there would be a. replacement cost using gas?
M
)
10 A
Mell, I' m not ready to conceive that we won't i
8 l
tha't we ' re proj e c ting.
That is our 11 grow at the rates U
best estimates and we' re planning on that basis and(I dIon%~
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think any. analysis of censidering'two alternatives you're 1 13
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of load i.
considering how you would supply certain amount 14 15 and if you eliminate the load,well neither consideration 16 is valid, I assume.
of these are a little disjointed.
17 Q
,J.'m sorry some 18-M.y no t e s didn't tally a little bit here.
19 A
I've got all afternoon.
l O'Connor, you 20
~ Q Regarding another question by Ms.
21 were discussing the Department of Energy figures and 22 mentioned that this was a fairly recent report, approxi-2 mately last fall and that these figures were for
'81,
'82, as the and ' 83, were these for the same size units 24
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25 Commanche Peak?
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-~A
STATE OF TEXAS )
Juanita Ellis, being duly sworn, deposes and says:
1.
That she is President of CASE (Citizens Association for Sound Energy);
2.
That she has participated in the following DP&L (Dallas Power 8: Light Company) rate hearings as a representative of CASE:
1975-76 DPE Rate Hearings, before the City of Dallas 1978 DP&L Rate Hearings, Docket 1526 1979 DP&L Rate Hearings, Docket 2572 1980 DP&L Rate Hearings, Docket 3460 3
That she knows the contents of the foregoing CASE's Answer to NRC Staff's Motion for Sinnmary Disposition of Contention 25 (Financial Qualifications) and that the came is true of her own knowledge and belief; and h.
That the quotations and infomation referenced regarding the above-listed rate hearings in the foregoing CASE's Answer to NRC Staff's Motion for Sinnmary Disposition o_^ Contention 25 (Financial Qualifi-cations) are true of her own knowledge and belief, based upon her personal recollection of said rate hearings and the documents and transcripts which she has obtained' or which have been supplied to her.
>2Aa,b
-1 gnitaEllis SWORN TO and Subscribed before me on this 18th day of November 1981.
y-,,.
, - A basu L_ ~
lm Notary Public My Commission Expires:
/--/w/M The original of this page is being mailed under separate cover, First Class Mail, to the Secretary, U. S. Nuclear Regulatory Commission, Washington, D. C. 20555, Attention: Chief, Docketing and Service Section, on this 18th day of November 1961.
m M
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f UNITED STATES OF AMERICA NUCLEAR REGUU'20RY COMMISSION
, g,..
. _.c BEFORE THE ATOMIC SAFETY AND LICENSING BOARD
(
In the Matter of I
~81 NOV 23 P1 :34 APPLICATION OF TEXAS UTILITIES 1
Docket Nos. 50-445 GENERATING COMPANY, ET AL. FOR AN 1
and 50._44_6;s OPERATING LICENSE FOR COMANCHE 1
i
.G 4 5ERZCE J<AJCH PEAK STEAM ELECTRIC STATION X
l UNITS #1 AND #2 (CPSES)
I CERTIFICATE OF SERVICE By my signature below, I hereby certify that true and correct. copies of CASE'S ANSWER TO NRC STAFF'S MCf1' ION FOR
SUMMARY
DISPOSITION OF CONTENTION' 25 (FINANCI!J.,
CUAT.T$'TcATTONS). i ncl udi ne STAT:v:NT OF MATERIAL FACTS AS TO WHICH utatE ARE GENUINE i
ISSUES TO BE HEARD and Index.
l have been sent to the names listed below this leth day.of November l
1981, by First Class mail locally and by Express Mail where indicated by *.
- Administrative Judge Marshall E. Miller David J. freister, Esq.
U. S. Nuclear Regulatory Commission Assistant" Attorney General Atomic Safety and Licensing Board Panel Environmental Protection Division Washington. D. C.
20555 P. O. Box 12548, Capitol Station Austin, TX 78711 o Dr. Kenneth A. McCollan Dean Division of Engineering, G. Marshall Gilmore, Esq.
Irchitecturs'andTechnologY 1060 W. Pipeline ' Road 01r1=h - State University Hurst, Texas 76053 Stillwater, Oklahoma 716074 Dr. Richard Cole, Member ~
Atomic Safety and Licensing l
Atomic Safety and Licensing Board Board Panel l
U. S. Nuclear Regulatory Commission U. S. Nuclear Regulatory Commission Washington, D. C.
20555 Washington, D.' C.
20555
- Nicholas S. Reynolds, Esq.
Atomic Safety and Licensing Debevoise & Liberman
' Appeal Panel l
1200 - 17 th St., N. W.
U. S. Nuclear Regulatory Commission Washington, D. C.
20036 Washington, D. C.
20555
- Marjorie Ulman Rothschild, Esq.
- Docketing and Service Section Office of Executfve Legal Director Office of the Secretary U. S. Nuclear Regula tory Commission U. S. Nuclear Regulatory Commission Washing,on, D. C.
20555 washington, D. C.
20555 t
cc: Homer Schmidt - Texas Utilities Al%N 3 O f -.
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(Mys.) Juanita Ellis, President CAS2 (Citizens Association for Sound Energy) l
-