ML20046C074
| ML20046C074 | |
| Person / Time | |
|---|---|
| Site: | River Bend  |
| Issue date: | 08/02/1993 |
| From: | Pembroke J CAJUN ELECTRIC POWER COOPERATIVE, INC., DUNCAN, WEINBERG, MILLER & PEMBROKE, P.C. (FORMERLY |
| To: | Grant G Office of Nuclear Reactor Regulation |
| References | |
| NUDOCS 9308090177 | |
| Download: ML20046C074 (6) | |
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- THOMAS L.RUDEBUSCH (408)988-4404 MICH AEL R. POSTAR 00 46F6370 TANJA M. SHONEWILER i
TELECCi'V (202) 467-6379 CHARLES A.BRAVN e
- 700 BELLEVUE AVENUE 5)RACU5E,NEW YORK 13219 OF COUN1EL (3tS) 47bt318 FREDE RICM L. MILLER, JR.
THOM AS J. LYNCH RICHARD K. PELz t August 2, 1993
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f ADMITTCQ TN WASHINGTON ONLY o ADMITTED IN VIRGINIA ONLY HAND DELIVERY Geoffrey E.
Grant, Acting Chief Inspection & Licensing Policy Branch U.S.
Nuclear Regulatory Commission l
Washington, DC 20555 Re:
Caiun Electric Power Coonerative.
Inc.'s, Resnonse to Staff's July 7.
1993 Ouestions
Dear Mr. Grant:
On behalf of Cajun Electric Power Cooperative, Inc.
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(" Cajun"), and pursuant to your request for the Staff of the Nuclear Regulatory Commission _("NRC" or the " Commission")', we respond as follows to the questions contained in your letter dated July 7, 1993:
QUESTION 1.
In the FERC " Order Accepting Rate Schedules, Accepting Amendment to Power Agreement, Conditionally Accepting Transmission Tariff With Modifications, Conditionally Accepting Service Agreements, Granting Waiver of Notice, and Denying Motion to Update Market Power Analysis", dated April 5, 1993, 63 F.E.R.C.
Paragraph 61,025,'the FERC urged the Entergy customers'(and the NRC.
staff presumes GSU's customers as well subsequent to the merger) who are eligible for certain benefits perceived to be broader than what is termed " point-to-point" transmission service over the Entergy system, to approach the FERC with specific objections in the context of a request to amend'or approve a service contract with Entergy Corporation.
Would Cajun explain to the staff why this proposal would not be an. acceptable option in resolving'its transmission' access dispute with GSU/Entergy?
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Geoffrey E.
Grant, Acting Chief August 2, 1993 Page 2
RESPONSE
The Commission Staff is apparently referencing the following language from the FERC Order cited in Question 1:
With respect to NRC license conditions, any customer that is eligible for different terms and conditions due to an NRC license condition may be separately accounted for in a service agreement.
If the customer alleges that the terms and conditions contained in the service agreement do not conform to applicable requirements, the Commission will address the issue at that time based on the specific facts presented by the customer and Entergy.
63 FERC T 61,025 at 61,147.
The " proposal" promulgated by the FERC is not an acceptable option to resolve Cajun's transmission access and competitive concerns regarding the transfer of control of the ownership of Gulf States Utilities Company ("GSU") to Entergy Corporation ("Entergy") for the following reasons.
First, the Service Agreement referenced by the FERC is Insufficient to incorporate different terms and conditions than i
those contained in Entergy's Transmission Service Tariff ("TST").
Simply put, the Service Agreement, which is an adjunct to the_
TST, cannot overcome the limitations contained in the TST.
The i
TST provides a point-to-point, transaction-by-transaction service.
The TST would have to be completely reformulated to be useful for network transmission service.
The Service Agreement, according to Entergy, is to provide specific information about transactions, e.o.,
contract demand, identification of points of delivery and similar information.
Egg TST at 23.
To our knowledge, there have been only three Service Agreements filed at FERC, each of them involving transactions of Entergy Power, Inc., an Entergy generation affiliate.
(No party other than Entergy has executed a Service Agreement.)
The three Service Agreements filed to date are each less than two pages long.
It is simply impossible that e
network transmission service could be provided in a Service Agreement, given the limitations contained in the TST.
The limitations in the TST filed at FERC include the i
very definition of the service to be provided, which is " point-l to-point" service.
Sag TST at page 11.
Another example is that power and energy transmitted under the TST must be " scheduled in advance."
Id. at page 31.
There are a host of problems with the TST.
What is required is a reformulated TST that provides for network transmission service.
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m Geoffrey E.
Grant, Acting Chief
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August 2, 1993 l
Page 3 Second, requiring transmission service customers, r
including Cajun, to wait for a future proceeding to resolve their
" transmission access dispute" does not resolve the anti-competitive effects of the proposed transfer of control of ownership of GSU to Entergy.
Those anticompetitive effects must i
be resolved in the NRC proceedings concerning the proposed transfer of control of ownership of GSU.
Third, the enforcement of the NRC license conditions is foremost a matter for the NRC, as the FERC administrative law
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judge found in Louisiana Power & Light Co.,
46 FERC 1 63,024 at 65,085 (1989).
Whether or not a FERC jurisdictional tariff must include terms and conditions of an NRC license condition is a matter for FERC to decide.
But, the enforcement of NRC license conditions cannot be delegated by the NRC to FERC.
t QUESTION 2.
In terms of Cajun's access to the GSU/Entergy transmission grid, what is Cajun's understanding of the significance, if any, of the presence of a specific sentence requiring one transmission rate for a group of entities (i.e.,
"For each coordinating group of entities there shall be a single transmission charge.") in the Waterford 3 nuclear license (antitrust license condition 5) and the lack of a similar sentence in the River Bend and Grand Gulf nuclear licenses?
RESPONSE
The significance of the quoted sentence in the Waterford 3 license condition is that it clarifies the meaning of "among entities."
The sentence does not add a requirement not already in the Waterford 3 license condition.
The term "among entities" was added by the Atomic Safety and Licensing Board because of the following observation:
The limitation of "between two entities" in Applicant's
[ proposed license conditions} is not an adequate provision designed to permit coordination (both operation and development) sufficient to overcome a situation inconsistent with the antitrust laws.
A change from "between" to "among" will correct this deficiency.
]
In the Matter of Louisiana Power & Light Co. (Waterford Steam Generating Station Unit No.
3), 8 AEC 718, 733-4 (1974).
The Commission also stated:
The purpose of this change [from "between" to "among")
is to prevent multiple transmission charges for transmission of a contracted transmission entitlement a
Geoffrey E.
Grant, Acting Chief j
August 2, 1993 j
Page 4 i
among a coordinated group of two or more entities.
To make the purpose of this change free from doubt, a clarifying sentence has been added.
Id. at 737.
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The Atomic Safety and Licensing Board clearly found that the opportunity for transmission customers within the Entergy system to obtain network transmission service in order to coordinate their services was and is necessary in order to alleviate antitrust conditions that would otherwise exist.
The TST, which the Applicants suggest will alleviate all anti-competitive concerns, simply does not fulfill the Waterford j
license condition, as discussed in Cajun's Motion to Intervene, etc.
Further, the River Bend license contains essentially
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the same requirement, i.e.,
service "between two or more" i
c'.,ti tie s.
Egg River Bend License Condition 10.
In fact, a FERC administrative law judge has found that the River Bend license i
conditions were modeled on the Waterford license conditions:
l That agreement [on Waterford] formed the model for i
resolution of the Gulf States case
[i.e., River Bend]
before the AEC.
Gulf States Utilities Co.,
55 FPC 1803, 1809 (1976).
Thus, the
" lack" of the specific sentence in the River Bend license l
conditions is not significant, and its meaning is implicit in the j
River Bend-(and Grand Gulf) license conditions.
QUESTION 3.
Are there currently any specific power transactions underway or currently being negotiated which Cajun will have to forego if the GSU/Entergy merger is consummated and Cajun is not q
granted " network transmission" or parallel j
meaningful access to the newly created GSU/Entergy
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regional transmission network?
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RESPONSE
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With the implementation of network transmission service, Cajun would be able to conduct power transactions utilizing such service.
Without the existence of a network transmission tariff on service, Cajun is prevented from engaging even in negotiations for power: transactions which require network transmission service.
Absent a defined, available tariff.or service, Cajun cannot know what transactions can be accomplished and thus cannot initiate meaningful negotiations with other utilities-.
There are power transactions which are currently being " foregone," although the specifics of such transactions j
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Geoffrey E.
Grant, Acting Chief August 2, 1993 Page 5 cannot be known by Cajun.
The River Bend and Waterford 3 license conditions would be implemented, reflecting their purpose, if the merger is approved only with the requirement of network transmission service.
QUESTION 4.
At page 74 of " Cajun Electric Power Cooperative, Inc.'s Comments, Petition For Leave To Intervene, And Request For Hearing And Conditions, On Application For Approval Of' Transfer Of ownership", Cajun makes reference to a " clash" between the Entergy open access transmission tariff which appears to allow for the collection of stranded investment costs and River Bend License Condition 1(c) which appears to prohibit stranded investment costs.
In light of the FERC's ruling, what is Cajun's understanding, of the effect of the phrase "except as otherwise authorized by any regulatory authority having jurisdiction", which is also a part of River Bend License Condition 1(c), regarding the collection of stranded investment costs by GSU in any future application of the Entergy open access transmission tariff to the GSU system?
RESPONSE
Cajun's understanding of the phrase in River Bend License Condition 1(c) is that it is part of a sentence which specifically applies only to " opportunity costs," 1.e.,
revenue from lost sales, and not to stranded investment costs.
Therefore, the " regulatory approval" phrase does not resolve the clash between the TST and the River Bend license conditions.
Geoffrey E.
Grant, Acting Chief August 2, 1993 Page 6 Please contact us if we can be of any further assistance with regard to this matter.
Sincerely, JO---itb James D.
Pembroke, Esq.
Thomas L.
Rudebusch, Esq.
Duncan, Weinberg, Miller
& Pembroke, P.C.
1615 M Street, N.W.
Suite 800 Washington, DC 20036 (202) 467-6370 Attorneys for Cajun Electric Power Cooperative, Inc.
cc:
Mark J.
Wetterhahn, Esq.
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