ML20054E163

Forwards NRC 820330 Memorandum & order,CLI-82-6,informing Us Court of Appeals for DC That Psychological Health Noncognizable Under Atomic Energy Act

ML20054E163
Person / Time
Site:	Clinton
Issue date:	04/01/1982
From:	Goddard R NRC OFFICE OF THE EXECUTIVE LEGAL DIRECTOR (OELD)
To:	Clark H, Ferguson G, Paris O Atomic Safety and Licensing Board Panel
References
CLI-82-06, CLI-82-6, ISSUANCES-OL, NUDOCS 8204260205
Download: ML20054E163 (8)

Text

{{#Wiki_filter:o e April 1, 1982 9 d s i k-Wa g% Hugh K. Clark, Esq., Chairman Dr. George A. Ferguson g Administrative Judge Administrative Judge 13 P.O. Box 127A School of Engineering Kennedyville, Maryland 21645 Howard University q 2300 Sixth Street, N.W. Washington, D.C. 20059 g Oscar H. Paris Administrative Judge Atomic Safety and Licensing Board U.S. Nuclear Regulatory Comission Washington, D.C. 20555 In the Matter of ILLIN0IS POWER COMPANY, et al. (Clinton Power Station, Unit 1) Docket No. 50-461 OL

Dear Administrative Judges:

Enclosed for your information is the Nuclear Regulatory Commission's Menorandum and Order in Metropolitan Edison Company (Three Mile Island Nuclear Station, Unit No.1), CLI-82-6, March 30,1982, furnishing the United States Court of Appeals for the District of Columbia Circuit with its views regarding psychological health as non-cognizable under the Atomic Energy Act (Enclosure 1). This issue is the subject of Intervenor Prairie Alliance's Proposed Supplemental Contention 7. Also enclosed is the Federal Register excerpt containing the Nuclear Regulatory Commission's final rule eliminating issues of financial qualifications of electric utilities from licensing hearings for nuclear power plants (Enclosure 2). Sincerely, 26 @Of Richard a. Goddard Counsel for NRC Staff cc: Se( page 2 Y OFC :0 ELD ( M

0 ELD

_____:____dE____:________.,_:____________:___________:____________:_______[_g: ._f______ I NAME :RGoddard/sb :EReis

i 4

bTE:bk[of)b2

bk)[fbb

e. . cc: with enclosure Prairie Alliance William van Susteren, Esq. Philip L. Willman, Esq. Mr. Herbert H.- Livermore Jeff Urish, Vice President Reed Neuman, Esq. Jan L. Kodner, Esq. Gary N. Wright - Atomic Safety and Licensing Board Panel-Atomic Safety and Licensing Appeal Board Panel Docketing and Service Section e

All Am \\ 1**.* a i UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION COMMISSIONERS: gg Nunzio J. Palladino, Chairman Victor Gilinsky John F. Ahearne Thomas M. Roberts SUVED Q In the Matter of ) ) METROPOLITAN EDISON COMPANY ) ) Docket No. 50-289 (Three Mile Island Nuclear Station,) Unit No. 1) ) ) ) MEMORANDUM AND ORDER (CLI-82-6) The United States Court of Appeals for the District of Columbia Circuit, in a Judgment issued January 7, 1982, in Pecole Against Nuclear Energy v. Nuclear Regulatory Commission, No. 81-1131, directed the Commission, inter alia, to " prepare a statement of the reasons for its determination that psychological health is not cognizable under the Atomic Energy Act." 1 1/ That Judgment came on petitioner PANE's appeal from the Commission's Memorandum and Order of December 5,

1980, in which a 2-2 division of the Commissioners on the question of whether psychological stress contentions should be accepted in the TMI-1 restart proceeding had the effect of denying those contentions.

Subsequently, after the appointment and confirmation of a fifth Commissioner, a 3-2 majority stated its adherence to the position that psychological stress contentions should not be accepted in the restart proceeding. That ruling, contained in an order dated September 17, 1981, was not accompanied by an opinion. h3 ; l J C ' 3 -

The views of the Commission with respect to the cognizability of psychological health under the Atomic Energy Act may be summarized as follows. First, the Atomic Energy Act itself does not discuss psychological health, and the statute, its legislative history, and applicable caselew all suggest strongly that Congress intended the Commission to exercise its regulatory authority to protect only against the physical risks associated with radioactivity. Even if it were found that Congress did not bar the Commission from considering non-physical risks associated with NRC-licensed activities, the indicia of Congressional intent alluded to above make clear that Congress never required the Commission to consider psychological health effects under the Atomic Energy Act, and there are strong policy considerations which argue against the consideration of psychological health effects The per se in NRC licensing and enforcement proceedings. l Ccmmission's reasoning is set forth in greater detail below. The Focus of the Atomic Energy Act is on the Hazards I. Which Civilian Nuclear Activities Pose to Physical Health and Safety, Not to Psychological Well-being. The statute, its legislative history, and A. applicable caselaw all indicate that Congress intended the Commission to protect public health and safety against the physical risks associated with radioactivity. l l The Atomic Energy Act does not address directly the question of whether the Commission's regulatory i I 1

3 e responsibilities extend to psychological effects associated with the operation of nuclear reactors. The relevant statutory provision states only that the Commission has the duty of regulating the operation of nuclear reactors "in order to... protect the health and safety of the public." 42 U.S.C. 2021 (d). The issue which faced the Commission was one of statutory construction: what did Congress intend the words " health and safety" to mean when it enacted the Atomic Energy Act of 1954? As explained by Commissioner Hendrie: The Congress which passed the Atomic Energy Act of 1946 created the Atomic Energy Commission in order to bring a maximum of technical expertise to bear on complex and hazardous activities associated with a developing technology. When the Atomic Energy Act of 1954 authorized the development of a civilian nuclear power industry, it was understood from the first that the public might well be apprehensive about a technology associated in the i minds of most with the destructive power of atomic weapons. One of the major reasons for providing for public hearings on nuclear power plants was to provide a means,for educating the public About nuclear energy and the measures taken to assure its safety. The 1965 report to the AEC by its Regulatory Review Panel, for example, characterized the most significant functions of public hearings as including a demonstration that "the AEC has been diligent in protecting the public interest" and that the applicant's proposal had received a " thorough and competent review." Congress implicitly acknowledged that public fears about nuclear reactors were a reality which had to be addressed; the means chosen by Congress was to have technical issues of nuclear safety addressed and resolved by technical experts in a public licensing review process administered by the Atomic Energy Commission. Thus, it is not only that there is no suggestion in the Act, its legislative history, or more than a quarter century of Congressional oversight that the Commission's decisions in licensing proceedings lL

4 5 0 g were intended to encompass psychological stress associated with particular licensing actions, it is also that Congress envisioned that the Commission's expert judgments, publicly arrived at, would help serve to prevent or allay public fears. Petitioner PANE argues that the plain meaning of " health," as defined in the dictionary, encompasses mental health, and that the Atomic Energy Act therefore obligates the Commission to evaluate the psychological effects of allowing the Three Mile Island Unit i reactor to resume In support of this position, PANE cites operation. judicial decisions in such areas as abortion, zoning, and tort liability. The meaning of the term "public health and safety", as used in the Atomic Energy Act, was analyzed in detail by the First Circuit Court of Appeals in New 406 F.2d 170, cert, Hampshire v. Atomic Enerev Commission, denied, 395 U.S. 962 (1969). In that case, the court rejected the contention of the 5 tate of New Hampshire that the Commission was required by the Atomic Energy Act to consider the effect on public health of discharges of hot At the same time, PANE asserts that it would be a 2/ " reductio ad absurdum" to suggest that psychological effects must be evaluated before nuclear reactors can be licensed to operate for the first time, since "[t] hat type of interpretation could conceivably prohibit reactors virtually anywhere, which is clearly not the intent of Congress." Petitioner's Brief in PANE v. NRC [ hereinafter " Petitioner's Brief"), pc. ~ YT"76.

5 water into the Connecticut River. The State had asserted that such discharges could be harmful to public health by reducing the capacity of the river to assimilate waste. Though the subsequent passage of the National Environmental Policy Act and the Federal Water Pollution Control Act amendments of 1972 3/ assures that the effects of thermal and other discharges are now fully evaluated before a reactor operating license can be issued, the court's analysis of the statute and its legislative history is no less valid today as a gloss on the meaning of the statutory language. As in the present case, the petitioners in the New Hampshire case argued that the analysis of the scope of the Commission's responsibilities need go no further than a judgment on the "present day plain meaning" of the terms " health" and " safety". The court rejected that proposed approach, stating: "we do not feel that we fulfill our function responsibly by simply referring to the dictionary." 406 F.2d 170, 173. The court explained: Here we feel a very palpable restriction in the history surrounding the problem addressed by the Congress, the i subsequent Congressional confirmation of the limited approach taken by the Commission... and a recognition i 3/ 42 U.S.C. S 4321, et seg. (NEPA); 33 U.S.C. S 1251, et seg. (FWPCA).

7 e of the complexity of administrative arrangements which would attend a literal definition of public health and safety as these terms are used in the Atomic Energy Act. 406 F.2d 170, 173-174. The court then stated its conclusion that "[tlhe history of the 1954 legislation reveals that the Congress, in thinking of the public's health and safety, had in mind only the special hazards of radioactivity." 406 F.2d 170, 174. It backed up that conclusion with an exhaustive review of the applicable legislative history, and it also traced subsequent actions of Congress and the Commission which shed light on the original congressional purpose. First, the court observed that the Senate and House Reports on the 1954 legislation contrasted conditions in 1946, when the first Atomic Energy Act was passed, with conditions eight years later. In 1946, the Reports said, "there was little experience concerning the health hazards involved in operating atomic plants," whereas by 1954 it had become " evident that greater private participation in power development need not bring with it attendant hazards to the health and safety of the American people." 406 F.2d 170, 174, n. 4, quoting Senate Report No. 1699, Vol. I, Legislative History of the Atomic Energy Act of 1954,

p. 751; House Report No. 2181, id., p. 999, U.S. Code Congressional and Administrative News, p. 3458.

The court found "(v]ery little else on the subject of health and safety... in the massive three volume Legislative History." It concluded: l

8 It seems obvious to us that these terms were beyond the purview of the 1954 deliberations and that their meaning had been deemed settled at the time of the passage of the Atomic Energy Act of 1946, 406 F.2d 170, 174, n. 4. The court then reviewed the legislative history of the 1946 Act. It cited the Senate Report on the bill, which described one of the kinds of authority granted to the Commission by Section 12 of the Act in the following terms: Establish safety and health regulations to minimize the danger from explosion, radioactivity, and other harmful or toxic effects incident to the presence of such materials. Sen. Rep. No. 1211, U.S. Code Cong. Service, 79th Cong., 2d Sess., 1946, p. 1335. The court observed that Section 12 of the 1946 Atomic Energy Act spoke more briefly of " danger from explosions and other hazards," and it found "no motive other than one of simplifying language" to explain the deletion of the words "from explosions and other hazards" in the 1954 legislation. 406 F.2d 170, 174 n. 4. The. court observed that the 1954 Act had created a "very special relationship, crystallized in statutory form between the Commission and the Joint Committee on Atomic Energy -- a relationship that is rarely embodied in positive law." 406 F.2d 170, 174. The court found that the Joint Committee's interpretation of the Act's purposes supported the view that Congress intended "public health and safety" to include only the "special hazards of radioactivity." The court cited the Joint Committee's first study report on the Act, in which it said:

9 O The special problem of safety in the atomic field is the consequences of the hazards, created by potentially harmful radiations attendant upon atomic energy operations. Joint Committee Print, A Study of Atomic Energy Commission Procedures and Organization in the Licensing of Reactor Facilities, 85th Cong., 1st sess.,

p. 4 (1957), quoted at 406 F.2d 170, 174.

The First Circuit commented that the Commission had been consistent in confining itself to the regulation of radiation hazards, and that the Joint Committee had The court apparently raised no objection to that approach. cited the Supreme Court's affirmation of the special significance of the Joint Committee's acquiescence in an action of the Commission: i It may often be shaky business to attribute significance to the inaction of Congress, but considering especially the peculiar responsibility and place of the Joint Committee on Atomic Energy in the statutory scheme, we think it fair to read this history as a de facto acquiescence in and ratification of the Power Commission's licensing procedures by Congress. Reactor Development Corp. v. International Union of Electrical Workers, 367 U.S. 396, 409 (1961), cuoted at 406 F.2d 170, 174 n. 5. The court went on to ' discuss subsequent amendments to the Atomic Energy Act which illuminated the intent underlying the 1954 Act. In 1959, Congress amended the Act to allow the Commission to relinquish control over sc=e I The nrelear materials and activities to the States. sta?.utory language spoke in terms of " protection of the 42 U.S.C. pubir.. health and safety from radiation hazards." In defining the authority which the States could 2021 (b). assume, Congress was necessarily also defining the authority which the Commission was already exercising.

= -- 10 The court also cited Congress' action in 1965 to amend 42 U.S.C. 2018 of the Act to make clear that the Commission was not subject to control by other governmental agencies, state, local and federal. In its report, the Joint Committee on Atomic Energy described the Commission's regulatory control as " limited to considerations involving - the common defense and security and the protection of the health and safety of the public with respect to the special hazards associated with the operation of nuclear facilities." S. Rep. No. 390, 89th Cong., 1st Sess., p. 4, 1965, cuoted at 406 F.2d 170, 175. New Hampshire v. AEC, in finding that the Commission's authority was limited to protecting against the "special hazards of radioactivity," plainly supports the Commission's action here, for psychological stress in our society is not peculiar to the generation of electricity through the splitting of atoms. PANE's argument that the fear of radiation is so I uniquely a hazard of radiation that it requires t I consideration by the Commission is unpersuasive. Presumably, every hazardous technology gives rise to fears peculiarly associated with it: fear of being inundated by l failure of a newly constructed dam, for example, or of being l l hit by debris from a crashing airplane. That is not a ground, however, for imposing a statutory duty on the Corps l of Engineers, the Federal Aviation Administration, or the l l

11 Nuclear Regulatory Commission, requiring those agencies to develop expertise in the categories and subcategories of psychological stress associated with the particular technology which each regulates. The Commission's determination that the major contribution which it can make to the alleviation of psychological stress is to make sound technical decisions in its areas of expertise is a wholly reasonable reading of its obligations under the Atomic Energy Act. PANE also contends that the New Hampshire court erred in its reading of the legislative history, and that it improperly narrowed the scope of the Commission's responsibility to protect " health" under the statute. In particular, PANE asserts that the court failed to give proper weight to what it terms "the only relevant pre-enactment legislative history of any significance", i.e., the description of the 1946 Senate Report, quoted above, of Section 12 of the Act. Petitioner's Brief, p. 31. According to PANE, the court failed to censider the significance of the Report's statement that the Commission's duty was to " minimize the danger from explosion, radioactivity and other harmful or toxic effects." PANE emphasizes the phrase "other harmful or toxic effects", contending that it shows Congress' concern with "a full range of harmful effects " PANE asserts that even if the court was correct in holding that the Com=ission's authority

12 extended only to the "special hazards of radioactivity," the " threat of invisible and unknown radiation" unquestionably l falls in that category. Petitioner's Brief, pp. 21-22. The language on which PANE relies does not support the broad reading of the statute which it urges, but rather the contrary, as the court correctly recognized. Under the eiusdem generis principle of statutory construction, where a statute sets forth a list of specific items and then j includes a reference to unspecified "other" items, the latter term will be construed as though it read, "other items of like kind." AI In the present case, the context 4/ The D.C. Circuit's discussion of the eiusdem generis rule of statutory construction in Association of American Railroads v. United States, 195 U.S. App.D.C. 371, 603 F.2d 953 (1979), is directly applicable to the present case: "The rule of eiusdem generis is a common sense doctrine which teaches: 'Where general rules follow specific words in an enumeration describing the legal subject, the general words are construed to embrace on object similar in nature to..those objects enumerated by the. receding specific words.' 2A Sutherland Statutory Construction 5 47.17, at 103 (4th ed. 1973) (footnotes omitted); see Weyerhauser Steamship Co. v. United States, 372 U.S. 597, 600-01, ~ 83 S.Ct. 926, 10 L.Ed.2d 1 (1963); Cleveland v. United States, 329 U.S. 14, 18, 67 S.Ct. 13, 15, 91 L.Ed. 12 (1946) ('Under the eiusdem generis rule of construction the general words are confined to the class and may not be used to enlarge it' (emphasis added); United States

v. Stever, 222 U.S. 167, 174, 32 S.Ct. 51, 53, 56 L.Ec.

145 (1911) ('(u]less there is a clear manifestation to the contrary, general words, not specific or limited, should be construed as applicable to cases or matters of like kind with those described by the particular words.'); United States v. Brown, 536 F.2d 117, 121 (6th Cir. 1976). A statutory reference to 'other' objects of a general nature... most frequently calls for the application of the doctrine." 603 F.2d 953, 963-64. In the present case, PANE is undeniably attempting to use the reference to "other harmful or toxic effects" to enlarge the class of effects reached by the statute to include matters which have never previously been suggested to fall within the scope of the Act. n, ,<-.,,.----_,.y

13 makes it apparent that Congress had in mind the physical dangers associated with nuclear materials, specifically the risks of explosion and of exposure to radiation, and the reference to "other harmful or toxic effects" can only be interpreted in that light. Psychological distress is sufficiently dissimilar to the types of harm enumerated in the statute that it cannot be considered among the "other harmful or toxic effects" contemplated by Section 12. This is all the more true in view of the total absence of any suggestion in the legislative history or in 35 years of Commission practice and congressional oversight that the Commission was intended to take into account psychological distress alleged to result from its activities'. The fact that Congress did not specifically state whether psychological distress falls within the Commission's authority does not, contrary to PANE's contention, argue for an expansive reading of the statute. Where Congress has intended that an administrative agency should take it has used psychological considerations into account, precise language to express that intent. In the Noise Control Act, for example, the Administrator of the Environmental Protection Agency is authorized to conduct or for research that includes " investigation of the contract psychological and physiological effects of noise on humans and the effects of noise on domestic animals, wildlife, and

14 property, and determination of acceptable levels of noise on 4913 (1) (A). 5/ the basis of such effects." 42 U.S.C. In the present case, it is reasonable to suppose that Congress never spoke to the issue of whether the Commission was required to consider psychological distress because the issue never came up. To the best of our knowledge, this case is the first instance, in the years since the Atomic Energy Act of 1946 was passed, in which the suggestion has been made that the Commission's 5/ Among other statutes in which Congress specifically authorized the agency to take psychological factors into account are the following: the Fire Research and Safety Act of 1968, providing inter alia for research into the " biological, physiological, and psychological factors affecting human victims of fire, psychological and motivational characteristics of persons who engage in arson..., the conditions of stress encountered by firefighters, the effects of such and the alleviation and reduction of such

stress, conditions," 15 U.S.C. 278 (f) (2), (f) (2) (E), and (f) (2) (G) ; the Occupational Safety and Health Act of 1970, "provi_ ding for researgh in the field of occupational safety and health, including the psychological factors involved," 29 U.S.C.

651 (b) (5) ; 1972 mnendments to the Elementary and Secondary Education Act of 1965, authorizing grants for projects designed to plan for, test, and demonstrate the effectiveness of programs for Indian children, including those to " meet the special health, social, and psychological problems of Indian children," 20 U.S.C. 887c. (b) (3) ; and the Rehabilitation Act Amendments of 1974, authorizing programs to " develop new and innovative methods of applying the most advanced medical technology, scientific achievement, and psychological and social knowledge to solve rehabilitation problems," 29 U.S.C. 701(5).

15 i I obligation to protect health and safety included the prevention of psychological distress. If, at PANE seems to argue, the silence of Congress on a particular issue were always to be construed as a mandate to the agency to consider that issue, the result would be to reward petitioners able to frame contentions so far-fetched that they either did not occur to the Congress or were considered too unlikely to warrant discussion. B. Even if the Commission's authority were broad enough to permit it to consider psychological health under the Atomic Energy Act, the Commission would not be required to do so, and strong policy considerations counsel against doing so. We have outlined in the preceding section of this Memorandum and Order our reasons for believing that Congress intended the Commission to confine its regulatory activities under the Atomic Energy Act to the physical hazards of l I At radioactivity, r.ather than to psychological concerns. the same time, we are conscious that the Commission, even more than most administrative agencies, has wide discretion to interpret the scope of its mandate and the means of fulfilling its duties. The D.C. Circuit Court of Appeals 1 in North Anna Environmental Coalition v. NRC, has commented, the NRC's regulatory scheme is " virtually unique in the that degree to which broad responsibility is reposed in the administrative agency, free of close prescription in its charter as to how it shall proceed in achieving the

16 statutory objectives." 533 F.2d 655, 658-59 (1976) (quoting Siegel v. AEC, 400 F.2d 778, 783 (D.C. Cir. 1968)). See also, Vermont Yankee Nuclear Power CoEg

v. NRDC, 435 U.S.

519, 543 (1978). Even if we believed ourselves to possess sufficient authority to permit us to consider psychological health under the Atomic Energy Act -- or were found by a reviewing court to have such authority -- the same indicia of Congress' overriding concern with the physical hazards of radioactivity which we have outlined above demonstrate a fortiori that the Commission is not required to consider psychological health under the Act. There are, moreover, substantial policy considerati.ons which argue against considering psychological effects under the Atomic Energy Act. The primary objective of the Atomic Energy Act was to protect the health and safety of the public from the dangers associated with a civilian nuclear power program by, establishing a technical agency with special expertise in radioactivity and its hazards. Congress provided for an expert agency and a public process for resolving questions of nuclear safety so that safety decisions would be made competently and openly. Viewed in that light, the reduction of psychological stress is a desirable byproduct of open and competent decisions. A technical agency, whether charged with assuring the safety of dams, airplanes, or nuclear power plants,

av ought properly to apply itself primarily to tha crono in which it is uniquely expert, as Congress intended. A technical agency cannot and should not be expected to devote its resources to developing expertise in the categories and subcategories of psychological stress alleged to be peculiar to the particular technology which that agency regulates. Rather, the protection of the public from psychological distress, including that resulting from fear of various technologies, ought properly be the responsibility of agencies with expertise in the area of mental health. 6/ The Commission took action to bring the issue to the 6/ attention of relevant groups. In November 1979, (Director of the special inquiry group Mitchell Rogovin established by the NRC to study the Three Mile Island accident) suggested that some action, perhaps by the National Institute of Mental Health, might be The Commission forwarded this appropriate. recommendation to the Governor of Pennsylvania with the " Recognizing that the responsibility for explanation: the health and welfare of those citizens is shared by the State of Pennsylvania and the Federal Government, the Commission believes that your views would be of the utmost value as we evaluate Mr. Rogovin's reccmmendation." (Letter from Chairman Joseph M. Hendrie, Nuclear Regulatory Commission, to Governer Richard Thornburgh, Pennsylvania, dated November 30, 1979.) After receiving a generally favorable response from Pennsylvania, the Commission sent a letter to the Department of Health and Human Services relating the background and concluding "the Nuclear Regulatory Commission believes that it would be desirable for your Department to evaluate these proposals and to consider what remedial programs may best address the problems that have been identified. We will direct our staff to provide whatever assistance may be necessary in (Letter developing and instituting such programs." from Chairman John F. Ahearne, Nuclear Regulatory Commission, to Secretary Patricia R. Harris, Department 1980.) of Health and Human Services, dated April 17, The Department of Health and Human Services acknowledged our request and identified some engoing state and federal efforts which addressed the concerns.

18 The major contribution which technical agencies can make to the prevention and alleviation of psychological stress is to make sound technical decisions and to make those decisions available to the public in understandable terms. To require technical agencies with no psychological expertise to address themselves to mental health issues would be doubly undesirable: it would impair the agencies' ability to fulfill their necessary technical responsibilities, while providing no assurance that the public's psychological well-being was entrusted to capable hands. It may be countered that a technical agency which lacks expertise in a particular area is at liberty to acquire that expertise, either by hiring knowledgeable staff or by retaining consultants. This is undeniable. What is equally undeniable, however, is that in a world of finite resources, the Commission cannot allocate funds and pe,rson.nel to the evaluation of psychological stress without diverting resources from its major responsibility -- that of protecting public health and safety from the radiological hazards posed by nuclear power plants. In our view, it f makes far more sense for the Commission to address itself to the health and safety issues which are the source of public anxieties than to attempt to quantify, analyze, and palliate I the anxieties themselves. The Licensing Board, in its certification to the Commission, was only expressing sound I common sense when it declared: "Certainly it is true that l

19 the best way to minimize any psychological stress in the communities around TMI-l is to make the plant safe or not allow it to operate." 11 NRC 297, 308. There are, moreover, issues which by their nature do not lend themselves to resolution in the adjudicatory process. The same reasoning which has led courts to disfavor the consideration of psychological effects under the National Environmental Policy Act is applicable to the adjudication of psychological health under the Atomic Energy Act. Judge Leventhal, writing for the D.C. Circuit in Maryland-National Capital Park and Planning Commission v. United States Postal Service, 487 F.2d 1029 (1973), observed: Some questions of esthetics do not seem to lend themselves to the detailed analysis required under NEPA for a 5102 (C) impact statement. Like psychological factors the "are not readily translatable into concrete measuring rods." 487 F.2d 1029, 1038. It may be argued in response to Judge Leventhal's comment that the Commission does in fact make judgments on esthetic matters as part of the NEPA process, and that a body capable of judging the esthetic effects of its decisions should also be capable of judging their psychological effects. That argument would not be valid, however. Although as Judge Leventhal suggested, esthetic factors may be difficult to quantify and describe with analytical precision, ultimately any layman is capable of forming an opinion on a matter of esthetics. By contrast,

20 o sound judgments on the probable psychological effects of regulatory decisions would require far more than a layman's opinion. Thus the need for expertise is added to the i problems of quantification. Finally, we believe that whatever, discretion the Commission may have in defining " health" under the Atomic Energy Act, the definition it adopts -- or which may be established by reviewing courts -- will be applicable to every nuclear power plant. We cannot accept the proposition, advanced by petitioner PANE, that the Atomic Energy Act requires the evaluation of psychological health in the vicinity of Three Mile Island, because of the accident there, but that it would be a " reductio ad absurdum" to suggest that the Act requires the Commission to examine psychological health whenever it licenses the construction or operation of a reactor. PANE goes on to explain that "[t] hat type of interpretation could, conceivably prohibit reactors virtually anywhere, which is clearly not the intent of Congress." PANE Brief, pp. 25-26. Whatever else Congress may have intended, we cannot believe that it meant that " health" under the Atomic Energy Act, should clearly encompass the psychological well-being of persons fearful of a second nuclear accident in their vicinity, while equally clearly excluding the mental health of persons who fear that their locality may experience its first nuclear accident. On the contrary, it

v ~ 21 is apparent to us that if the definition of " health" under the Act is held to include psychological health in any proceeding, the inevitable result will be the litigation of psychological health in virtually every licensing proceeding, with effects on the NRC's processes which could only be destructive. It is not merely that the analysis and litigation of psychological stress issues would require the expenditure of resources and time; safety issues also require resources and time, but those expenditures on safety issues contribute to sounder decisions and the better protection of the public. We do not believe that the public well-being, including psychological well-being, would be benefited in any meaningful way if the Commission's Licensing Boards or the Commission itself were to take on the task of weighing, in one licensing proceeding after another, the essentially unprovable claims and counter-claims of competing arrays of mental health experts. We reiterate, therefore, our conviction that the appropriate means of taking psychological stress into most account in its decisionmaking process is to make sound safety decisions and to publicize fully and accurately the basis for those decisions. In that way, the resources of the Commission can be devoted tc the agency's real task -- that of protecting the public's health and safety by licensed nuclear reactors are built and assuring that operated safety -- rather than diverted te assessing the

22 degree to which members of the public fear those judgments to be incorrect. The separate views of Commissioner Gilinsky are attached. Fo the Commiqsion, U !.". I 5 3 '; ( J._da h( a.J l T' s [ *4 SAMUEL 5. CHILK m, / d Secretary of~the Commission V: ,1: u. s s y ,.. Q ~- w ..y,..,..,.,- Dated at Washington, DC this 30th day of March, 1982 I

SEPARATE VIEWS OF COMMISSIONER GILINSKY In my view, the Commission has discretion under the Atomic Energy Act to consider psychological health issues raised in connection with the licensing of nuclear power plants. In the TMI-1 restart proceeding, the Commission should have exercised this discretion to adr.ut the psychological stress contention to the hearing after the Commonwealth of Pennsylvania asked the Commission to consider this issue and the Licensing Board unanimously supported that request. In any other field, such issues would normally be handled by the political process at the State and local level. In light of the Atomic Energy Act's pervasive preemption of State authority regarding nuclear matters, only the Federal Government can deal with them. The Commission, as the representative of the Federal Government, should have made every effort to accommodate the concerns of_the Commonwealth. I do not think that taking up psychological issues after the most serious nuclear power reactor accident in history in any way implies taking them up in every reactor licensing In mest cases, the public interest would not be served case. by airing these issues in the Commission's proceedings. These matters are intrinsically difficult to adjudicate and, in any case, largely beyond the Commission's expertise. It is by no means clear that the Commission would be able to 't

deal with them in a satisfactory way. Nonetheless, in the particular circumstances of this case, it would have been wiser for the Commission to have heeded the Commonwealth's concern. What the Commission did, in effect, was to tell the neighbors of this plant that nowhere in the government--local, state, or federal--can the concerns at issue here be considered, short of an act of Congress. I

i 13750 Fedir:1 Register / Vol. 47. Ns. 62 / Wedneed:y. March 31.1g82 / Rules and Regul:tions NUCLEAR REGULATORY (2)(1) Also eliminated entirely these requirements and also requiring COMMISSION requirements for operating license licensees to demonstrate their ability to applicants; or clean up after an accident. By contrast. 10 CFR Parts 2 and 50 (ii) Retained these requirements for utilities, utility groups, and utility operatinglicense applicants to the contractors support completely Elimination of Review of Financial extent they require submission of aliminating the Commission's finandal Qualifications of Electric Utilities in information concerning the costs of quali$ cations requirements. including Licenalng Hearings For Nuclear Power permanently shutting down the facility decommissioning. Further. utilities and g Plants and maintaining it in a safe condition their representatives generally oppose i (i.e., decommissioning costs). requirtng mandatory property damage AotNcy: Nuclear Regulatory Concurrently, the Commisalon insurance. Comments from legal counsel i Commission. proposed amending its regulations to generally reDected the interests and ACTlow: Final rule. require, on an interim basis, power views of their utility, insurance, or reactor licensees to " maintain the public interest clients. Governmental suuuamv:The Nuclear Regu!atory maximum amount of sommercially organizations and individuals reflected Commission is amending its regulations available on-site property damage a spectrum of dews, although most to eliminate entirely requirements for insurance, or an equivalent amount of were against eliminating the financial financial qualifications review and protection (e.g letter of credit, bond, or quali$ cations review. Some states and findings for electric utilities that are self insurance), from the time that the municipalities identified potential legal applying for construction permits or Commission first permits ownership, conflicts between certain provisions of operating licenses for production or possession, and storage of special the proposed rulemaHng and state law. utilization facilities. The Commission is nuclear material at the site of the A summary of the comments is also amending its regulations to require nuclear reactor." presented below.Those who are power reactor licensees to obtain on. site In the Federal Register notice, the interested may obtain copies of specific property damsge insurance, or an Commission based its proposal for this comments from the Public Document equivalent amount of protection (e.g., rulemaking. In part, upon the statutory Room or the NRC Secretary under 1.etter of credit, bond. or self insurance), basis in the Atomic Energy Act of1954. designation PR-50 (46 FR U786), by from the tinie that the Commission first as amended ("AEA") for the financial writing to: Office of the Secretary. U.S. Issues an operating license for the qualifications regulations and its Nuclear Regulatory Commission, discussion in Public Service Company of Washington D.C. 20555 t nuclear reactor. '$fb8 i ] 1. 7 NRC Commission 's fmancial qualifications ^

1. 8 ## # "'"#"##

arrscTivt caTE:For amendments eliminating financial qualifications 1 (1978)(.'Seabrook,2I.

• ). In that decision review. Those arguing against reducing review (12.104. Sections VI and Vill of and the proposed rulemaking the or eliminatm' s the Commission's Appendix A to Part 2. I12.4. 50.2.

Commission affirmed its belief that the financial quahfications review make Appendix C to Part 50. Appendix M. existing financial qualifications review four mejor points. First, they discount paragraph 4.(b) to Part 50. I 50.33(f). and has done little to identify substantial NRC's presumption that public utilities 150.40). Mar. 31.1982. For amendments health and safety concerns at nuclear can meet the financial demands of establishing on-site property damage power plants. However, because the constructing and operating nuclear insurance requirement (i150.54(w) and Commission beheved that there are plants. Citing Seabrook. WPPSS. TMI. 50.57) June 291982. In accordance with matters important to safety which may South Texas and other examples. the Paperwork Reduction Act of1980. be affected by financial considerations, commenters maintain that utilities often (44 U.S.C. 3507), the reportir's provision it requested comments regarding the have experienced and will continue to that is included in paragraph (w)(5) of type of NRC financial review that would experience difficulty in raising funds to 150.54 has been submitted for approval i cus effectively on considerations that cover capital, operating, and to the Office of Management and Budget might adversely affect safety. maintenance costs (particularly in l 3 (OMB). It is not effective until OMB i approval has been obtained. II. Public Comments on the Proposed Periods of high interest rates and Rule overcapacity). whether or not such costs FoR FuRTHER INFORMATION CONTACT

• can be recovered in the rate base Jim C. Petersen, Office of State Over 100 comments were received on through Construction Work in Progress Programs. U.S. Nuclear Regulatory the proposed rulernaking and have been I

(( 'c ['te bs 'd Commission. Washington. D.C. 20555 categorized as follows: g a l (telephone 301-492-9883)- Private citizens-ee comments received the inability to recover all costs [ Public interest groupe-30 comments received provides an incentive for utilities to SUPPLEMENTARY INFORMATION: I I. Background gY1 nselle~en n nts $I s'i skimp on important safety components and quality assurance standards. Some l Governmental organizations and commenters cite the discussion of On August 18,1981, the Commission individuale-to comments received published a notice of proposed Utilities and utility groupe-te comments financial disincentives in the Rogovin rulemsking in the Federal Register (46 received Report (Three Mile Island: A Report to FR 41786) concerning requirements for Architect-ergineers and contractore-2 the Commission and the Public. Mitchell comments received Rogovin. Director. January 1980) to finencial qualifications review and findings for electric utilities that are All private citizen comments and all support their views. Another commenter appinns for permits or licenses for but two public interest group comments suggests that utilities will be tempted to production or utilisation facilities. As oppose reducing or eliminating the lower wages which would lead to higher proposed, the rule would have: Commission's financial qualification turnover and, thus, to employment of (1) Elunineted entirely financial review requirements. However, they inadequately trained personnel. Third, qualifications review requirements for generally support imposing immediate commenters maintain that NRC construction permit applicants; and decommissioning financing inspection efforts and capabilities are -~.-. _ -..

4 Rd:ral Regist;r / Vol. 47, No. 62 / Wedneed:y, March 31. 1982 / Rules and Regulations 13751 j e inadequate to provide sufficient indicated its support for the subete the importaare of dacnemissioning g assurance of safety. Even if violations of the proposed rule-elimination sithe funding to public health and safety, but are found. some commenters argue that financial qualifications review because rather recognizes that any action on NRC enforcement efforts are of the lack of any demonstrable link decommissioning is more appropriate in inadequate. Fourth. the commenters between public health and safety the context of the generic rulemaking j assert that the financial qualifications concerns and a utility's ability to make now being conducted. Until that time, review function is atstutorily required the requisite financial showing. the Commission has concluded that it is by 42 U.S C. 2232(a), (c) and (d). The actual fmancial situation premature to include any final decision Further, many of those arguing against analyzed in that case has not changed. on decommissioning in this final rule on ehminating the financial quahfications There is no evidence that the safety of financial qualifications. Because the review recommend that the Commission the public has been adversely affected generic decommissioning rule is should at least retain that portion of the by Public Service Company of New scheduled to be published in 1982 and review pertaining to decornmissioning. Hampshire's (PSCNH) difficulties in since alllicensees will be required to They state that the ongoing obtaining financing. It is true that to meet any financial requirements decommissioning rulemaking is no raise capital. PSCNH has sold part ofits imposed as a result of that rulemaking. substitute for an immediate general ownership in the Seabrook plant. but there should be little practical effect in requirement to demonstrate fmancial such action does not have any temporarily eliminating consideration of capabihty to decomnussion a nuclear demonstrable link to any safety decommissioning funding from licensing production on utabzation facility safely problems. Similarly, citing WPPSS' activities. Moreover. if decommissioning and expeditiously. Man) expressed the experience is not convincing, because financing issues were~contmued to be siew that the generic decommissioning WPPSS' response (and that of most other allowed in current licensing study would not be completed in a utilities encountering financial proceedings, two undesirable effects re >onable time. difficulties) has been to postpone or may result. First. there wou!d be an B contrast. those fasoring the cancel their plants, actions clearly not increased chance that findings in such 3 Comzrasion's proposed reduction or inimical to public health and safety cases might contradict evolving ehminaticn of the fmancial under the Atomic Energy Act. Commission policy in this area Second. qua'.'s.t.ans regen function generally As to the third point raised in one positive gain frem the final rule support the Commission's reasoning that opposition to the proposed rule, in the would be countered. in that there could such a reuew has done htt!e to identify absence of facts to the contrary, the be expected to be little. if any. reduction s;.bstantae health and safet> problems Commission cannot accept unsupported in the contentions before the hcensing at nucitar pou er p;.nts and that the statements that, as a general matter its boards on financial quahfications Comm:ssion's inspection and inspection and enforcement efforts are issues. thereby not significantly enforcement actaities proside more inadequate. The examples that reducing the time and effort devoted to effectn e pru:cction of pubbc health and commenters cite (e g., South Texas) those issues. safet). Most utihties and their appear to substantiate, rather than B. Mandatotypreperty insurance for associates support complete elimination undercut, the Comniission's view that decontamination. Comments are of the fmancial qualifications review, any violations of safety regulations are similarly divided on the issue of including provisions pertaining to being found and corrected and that, in requirms on site property insurance to decommissioning. These comznenters any event. such violations cannot be cover decontamination expenses rnaintain that,if any regulations relating shown to arise'from a hcensee's alleged resulting from an accident. Those w ho to the financing of decommissioning are lack of financial qualifications. support keeping the fmancial adopted they should await completion With respect to the fmal assertion that qualifications review generall> support of the Commission's generic rulemaking the financial qualifications review requiring a utiht3 to demonstrate proof on decomm:ssioning. function is statutorily mandated. Section ofits abibty to clean up after an The Commission has received no 182a of the AEA. 42 U.S.C. 2232(a). accident. The ComInission interprets comments to persuade it to change clearly indicates that such function is these comments as supporting sigmficant!> its reasoninF on the within the Commission's discretionary mandatory property insurance, insofar proposed fmancial qualifications rule. authority, but is not mandated. As noted as it covers accident cleanup costs. The As ind.cated above, many of those in the proposed rule, this interpretation other comasenters favoring elimination opposing the proposed rule change have of Section 182a has been approved by of the financial qualifications rule concluded that experience with the United States Court of Appeals for generally either (1) oppose mandatory Feabrock. WPPSS and other plants the First Circuit in New England coverage outright because of recent self. demonstrates the close connection Coalition on Nuclear Pollution v. NRC, initiated moves by the utility industry to between fmancial quali5 cations and 58 F.2d 87,93 (1978), affirming the obtain insurance or (2) favor substantial pubhc health and safety. The NRC's SeabrooA decision. modification of the rule to clarify Commission disag*ees. As to the first On balance, after careful several of its provisions. point raised by commenters opposing consideration of the comments The first group of commenters do not ehmination of the financial submitted and of the factors discussed generally state their reasons for favormg quahncations review, the Commission in the notice of proposed rulemaking, mandatory insurance except for an does not fmd any reason to consider,in the Commission has elected to undefined and non-quantifiable general a vacuum, the general abihty of utihties promulgate the first of the two benefit in protecting pubbe health and to fmance the construction of new alternatis es outlined in the proposed safety. Some indicated that the amount generation facilities. Only when joined rule, i.e., eliminate the financial ofinsurance currently available le not with the issue of adequate protection of qualifications review of electric utilities sufficient to cover accidents such as the public health and safety does this entirely at the CP and OL stages. TMI-2. However, because of recentiv issue become pertinent. As to this, the including elimination of any announced increases in the amount of commenters* second point. the consideration of decommissioning coverage available and the continuing Commission in its Seabrook decision funding This is not meant to discount evolution in the insurance markets, this

13'752'

• Tcdtr:l Register / Vol. 47 No. 62 / Wednecday, March 31. 1982 / Rules and Regul:tiins concern may not be as great as might Commission disagress with the position authority to require such additional otherwise be the case, taken by some commenters that it la information in individual cases as may As indicated above, the second group unfair to many owners of smaller power be necessary for the Commission to h

of commenters-primanly utilities and reactors to require insurance greatly determine whether an application i their representatives-object more to exceeding the cost of replacing the should be granted or denied or whether the wording of certain provisions of the facility. A TMI-2 type scddent oculd a license should be modified or revoked. = goposed on site property damage well require coverage approaching 31 See, for exemple, the fourth sentenos of insurance rule than to the requirement billion.no matter what the original Section182a of the AEA.Similarly,no 4 itself. Several commenters recognize value or size of the facility.The change in the present powers of the that the practical effect of requiring Commission expecta that the required Commission with regard to the Anancial mandatory insurance has been reduced. insurance will cover reasonable qualifications review of non-utility particularly since the "nU-2 accident, decontamination and cleanup costs applicants for Part so licenen will be because most utilities will buy whatever associated with the property damage made.In addition, an exception to or amount of coverage is offered.within resulting from an accident at the waiver from the rule would be possible reasonable limits, as a matter of good licensed facility. Until completion of to require the subminion of Anancial = business judgment. Other commenters studies evaluating the cost of cleaning information from a particular electric indicate that the Commission's up accidents of varying severity,it is utility applicant if special circumstances estimates of annual premiums required prudent to re luire for all power reactors are shown pursuant to lo CFR 2.758 in for a typical reactor may have been a reasonable amount ofinsurance for an individuallicensing hearing. .mderstated. Estimated premiums for decontamination expense. B.Piceticallmpocra. Also as coserage currently available (i.e., $375

3. Several persons commented that indicated above and in the proposed or $450 million) are $3 million per year reactor licensees should not be required for a typical two-umt site.

to maintain on site property damage rule, the Commission continues to In light of these comments and for the insurance until the operating license has expect that the final rule will, in normal reasons stated in the proposed rule, the been received. With fuel merely stored circumstances, reduce the time and Commission has decided to retain the at a reactor, the chance of an accident effort which applicants, licensees, the requirement in the final rule that electric requiring extensive decontaminationis NRC staff and NRC adjudicatory boards utthties must have on site property extremely remote.The Commission devote to reviewing the applicant's or damage insurance, but several agrees and has changed the rule licensee's financial qualifications. The modifications has e been made pursuant accordingly, so that such insurance need rule will eliminate staff review in cases to the comments received. The following be in force only when the utility is where the applicant is an electric utility. changes have been incorporated into the licensed to operate the reactor, presumed to be able to finance activities text of the final rule on property

4. Several Texas utilities commented to be authorized under the permit or that the Texee constitution (and, license.

insurance:

1. The defmition of " maximum apparently,ine louisiana and Idaho C.Ucense Amendments. ne available amount" has been clarified.

constitutions) prohibits certain elimination by this rule of the financial This term could have been interpreted to municipal utihties from purchasin8 qualifications review for electric utility mean that utilities would be required to insurance either offered by mutual applicants also applies to any electric swttch their insurance coverage to the insurance companies or involving utilities that become co-owners via carner offering the greatest amount at retroactive assessments.The amendments to existing permits or any particular time. Another Commission has revised the rule to licenses. From time to time, original interpretation could be that utilities address these concerne, owners of production or utilization would be required to obtain coverage 5.One commenter discussed the need facilities make arrangements to transfer from the two major insurers or,any other to clarify the amount of time required of to other electric utilities a portion of the insurer that decides to enter this market. the hcensee to obtain not only initial ownership in the facihty. Normally, an Finally, the " maximum available' could insurance but also subsequent increases amendment request is then filed, which increment no matter offered. Another suggested that many seeks to add the new partner as co-have included and or how restrictive the regulated utilties may have difficulty in how highly price I e or purposes terms and conditions.The Commission's obtaining approval to purchase Q',r a intent is neither to disrupt the insurance insurance within 90 days.The relating to prehcene.g antitrust rniew markets by forcing utilities to switch Commission has revised the rule to of these new owners, the amendment their insurance carriers unnecessarily reflect its view that 90 days is a request comprises the initiallicense nor to require utilities to obtain reasonable time in which to take insurance under unreasonable terms reasonable steps to obtain both initial application by the new, prospective em owner, nu though the ammdmet and conditions.The rule has been and any additional on-site property request may actually be filed by the changed to clarify the Commission's damage insurance. 2 intent. specifically in i 50.54(w).

6. The phrase " commercially present licensee and owner. E.g Detroit

2. Some commenters maintained that available" insurance could have been Edison Company (Enrico Fermi Atomic the proposed rule should apply only to construed to exclude insurers such as Power Plant. Unit No. 2). ALAB-475,7 i

NRC 752,755. n.7 (1978). Since the same insurance cosering decontamination of a NML and NEIL The Commission facility suffering an accident and not to recognizes this possible but erroneous financial quahfications review "all risk" property damage insurance. interpretation and has changed the considerations apply to all electric Because decontamination insurance is wording of the rule accordingly. utility applicants, regardless of the particular manner in which their the Commission's only concern from the III. Other Considerations application is tendered to the NRC,it point of view of protecting public health f and safety, coverage to replace the A.Requirementfor Additional should be clear that this final rule existing facility on an "all risk" basis is Information. As irdicated in the applies to Eny request for an beyond the scope of the Commission's proposed rule, the Commission does not amendment that would,if granted. authority. By the same reasoning, the intend to waive or relinquish its residual include a new electric utilny as a co-

s Fed;r:1 Regist:r / Vcl. 47. N. 62 / Wednesdry. Krch 31, 1982 / Rules and Regulations 13753 owner and co licensee in a production L 96-511). The date on which the sec. a. Pub. L 91-880, se Stat.147'2 (42 U.S C ( or utihzation facihty. information collection requirements of 2135). IV. Conclusion this rule become effective, unless advised to the contrary, accordingly,

2. In i 2.4. new paragraph (s) is added i

to read as follows: In summary, the Comm,ssion has reflects inclusion of the 80 day penod concluded that the adoption of the rule which the Act allows for such review. 32.4 DennMons. ",I bstan a y redu e the effort and c,, .,e Regulatory Flexibility Certification As used in this part, demonstrating financial qualifications of in accordance with the Regulatory electric utilities that are applying to Flexibility Act of 1980. 5 U.S.C. 805(b). (s)" Electric utility" means any entity construct and operate nuclear the NRC hereby certifies that this rule that generates or distributes electricity production and utilization facilities will not have a significant economic and which recovers the costs of this without reducmg the protection of the impact on a substantial number of small electricity, either directly or indirectly, pubhc health and safety. This portion of entities. The rule reduces certain minor through rates established by the entity the rule will be effective immediately information co!!ection requirements on itself or by a separate regulatory upon pubhcation, pursuant to 5 U.S.C. the owners and operators of nuclear authority. Investor-owned utilities 533(dj(1). since the rule is expected to power plants licensed pursuant to including generation or distribution rehese significantly the obligation of sections 103 and 104b of the Atomic subtidiaries, pubhc utihty districts, certain applicants with respect to Energy Act of1954. as amended. 42 municipalities, rural electnc information required for construction U.S.C. 2133,2134b. These electric utility cooperatives, and state and federal permits and operating licenses, and also companies are dominant in their service agencies. including associations of any to reduce the amount of unnecessary, areas. Accordingly, the companies that of the foregoing. are included within the time-consuming staff review and own and operate nuclear power plants meaning of " electric utihty." adjudicatory proceedmgs. Although the are not within the definition of a small rule will be apphed to ongoing licensing business found in section 3 of the Small

3. In 52.104, paragraph (b)(1)(iii) and proceedings now pending and to issues Business Act.15 U.S.C. 632, or within introductory partgraph (c)(4) are revised or contentions therein. Union of the Small Business Size Standards set N' ' ' ' * * " " '.

ConcernedScientists v. AEC. 499 F.2d forth in 13 CI'R Part 121. 12.104 Notice of hearing. 1069 (D C. Cir.1974). It should be clear that the NRC neither intends nor Pursuant to the Atomic Energy Act of 1954. as amended, the Energy expects that the rule will affect the Reorganization ^ Act of 1974, as amended. IDI... scope of any issues or contentions and section 553 of Title 5 of the United (1) * *

• related to a cost / benefit analysis States Code, the following amendments (iii) Whether the applicant is performed pursuant to the National to to CFR Parts 2 and 50 are published financially qualified to design and Environmental Policy Act of1%9, either as a document subject to codification.

construct the proposed facihty, except in pending or future bcensing e proceedmgs for nuclear power plants. PART 2-RULES OF PRACTICE FOR that this subject shall not be an issue if Under NEPA the issue is not whether DOMESTIC LICENSING PROCEEDINGS the applicant is an electric utihty the appbcant can demonstrate

1. The authority citation for Part 2 seeking a license to construct a reasonable assurance of covenng reads as follows:

production or utilization facility of the type described in I SO 21(b) or $ 50.22. certain projected costs. but weather is Authority Secs 161.181. 68 Stat. 948. 953 merely what costs to the applicant of (42 U.S.C. 2201. 2231); sec.191. as amended, construct:ng and operating the plant are Pub. L 87-815. 78 Stat. 409 (42 U.S C 2241) (c) * *

• to be put into the cost benefit balance.

sec. 201. Pub. L 93-438. 88 Stat.1242. a s (4) Whether the applicant is As is now the case, the rule of reason b 78 g U; 2 nh technically and financially quahfied to will contmue to govern the scope of o what costs are to be included in the issued under secs. 53. 62. 81.103.104.105. 68 engage in the activities to be authorized Stat. 930, 932. 935. 938. 937. 938.as amended by the operating license in accordance balance and the resulting (42 U.S C. 20 3,2093. 2111. 2133. 2134. 2135): with the regulations in this chapter. determmations may still be the subject sec.102. Pub. L 91-190. 83 Stat. 853 (42 U.S C. except that the issue ci financial oflitigation Thus fmancial 4332). sec. 301. sa Stat. 1248 (42 U.S C 5871). quahfications shall not be considered by . qualifications would not be expected to Sections 2.102. 2.104. 2.105. 2.721 also issued the presidmg officer in an operatmg become an :ssue or contention in an under secs.102.103.104.105.183.189. 68 Stat. license heanng if the applicant is an NRC hcensmg proceedmg insofar as 936.937.938.954.955. as amended (42 U.S C 213 electric utthty seeking a license to NEPA might be mvoked. 21,(3 dissuEd 5 operate a production or utihzation g ea ta t. The Commission has also concluded i that adoption of the on-site property 955 (42 U S C 223el. sec. 206. 88 Stat.1248 (42 facihty of the type described in U.S C 5846L Sections 2.600-2 sos. 2 730. 6 50.21(b) or 150.22. damage insurance requirement, as 2 772 also issued under sec.102. Pub. L mod:fied, will better ensure that 91 190. 83 Stat. 853 (42 U.S C. 4332). adequate protection of the health and Sections 2.700a. 2.719 also issued under

4. In Appendix A of Part 2. Sections safety of the pubhc is achieved. This 5 U.S C 554. Sections 2.754. 2.760.

VI(c)(1)(iii) and \\,Ill(b)(4) are revised to requirement will be effective june 29. 2.770 also issued under 5 U.S C 557. read as follows: 1981 Section 2 790 also issued under sec.103 M Stat 936. as amended (42 U S C. 21331 Appendix A-Statemen! of General Policy Paperwork Reduction Act Statement sectwns 2 800-2 807 also issued under 5 and Procedure: Conduct of Proceedags for the lesuance of Construchon Permits and The Nuclear Regulatory Commission h,553 Se 'N" 8]'S a\\'.* Operatin8 Ucenses f or Production and ,,nd U.S C has submitted this rule to the Office of hianagement and Budget for such 43321 Section 2 809 also issued under 5 U S C. M** " " Iib" '*' Whi'h * "'*","8.' 3 553 and sec. 29. Pub. L 85-256. 71 Stat. 579 as Required L oder Section 189 A of the Atoauc teuew as may be appropriate under the amended b) Pub L 95-209. 91 Stat.1483 (42 bern Act of1950 as Amended i paperwork Reduction Act of1980(Pub U S C 2o39). Append:s A is also assued under

_,,;;pse 13754 Federal Register / Vcl. 47. Ns. 62 / Wedn:sday. March 31, 1962 / Rules and Regulations VI. Posthearing Proceedings. Including the cooperatives, and state and federal of constructing or operating a facility Initial Decision agencies, including associations of any must also include information showing-of the foregoing, are included within the (i)De legal and Anancial ic) * *

• meaning of " electric utility."

relationships it has or proposes to have

7. In i 50.33, paragraph (f) is revised to with its stockholders or owners; O)***

(m) Whether the applicant is financially read as follows: (ii)%eir financial ability to meet any 'I 9"*hId'" d8" *"d * ""*h' contractual obligation to the entity i e8 iaPPucanons, W which they have incurred or propose to kafl nof b anis' suete p can an incur; and electric utihty seeking a licanae to construct a Each application must state: (iii) Any other information considered production or utilization facility of the type described in 150.21(b) or 50.22: necessary by the Commission to enable (f)(1)Information sufficient to it to determine the applicant's financial demonstrate to the Commission the qualifications. . Vill. Procedures A pplicable to Operating financial qualifications of the appbcant (3) Except for electric utility ,i Utense Proceedings to carry out,in accordance with applicants for construction permits and f regulations in this chapter, the activities operating licenses, the Commission may g... for which the permit or license is sought. request an established entity or newly-(4) Whether the applicant is technically and financiall) quahfied to engage in the However, no information on financial formed entity to submit additional or i actmties to be authorized by the operatmg qualifications, including that in more detailed information respecting its bcense in accordan:e with the Commission's paragraphs (f)(1)(i) and (ii) of this financial arrangements and statu; of regulations. except that the issue of financial section,is required in any application. funds if the Commission considers this quahfications shall not be considered by the not shall any financial review be information appropriate.This may board if th apphcant is an electnc utihty conducted. if the applicant is an electric include information regarding a utility applicant for a license to licensee's ability to continue the conduct I lizat on ac IIt ftet e e enb d u construct or operate a production or of the activities authorized by the l 50.21(b) or i 50.22 utilization facility of the type described license and to permanently shut down in i 50.21(b) or i 50.22. the facility and maatain it in a safe PART 50-DOMESTIC LICENSING OF (i)If the application is for a condition. PRODUCTION AND UTILIZATION construction permit, the applicant shall e submit information that demonstrates

8. In 150.40, paragraph (b) is revised FACILITIES the applicant possesses or has to read as follows:

5. The authority citation for Part So is reasonable assurance of obtaining the revised to read as follows:

funds necessary to cover estimated $ 50.40 Common standards. Authority; Secs 103.104.161.182.183,189. construction costs and related fuel cycle 68 Stat. 936,937. 948. 953. 954. 955. 956, as costs.The applicant shall submit (b) The applicant is technically and amended (42 U.S C. 2133. 2134 2201. 2232. estimates of the total construction costs financially qualified to engage in the i 2:33. :239). secs 201. 202. 206. 6a Stat.1243, of the facility and related fuel cycle proposed activities in accordance with costs, and shallindicate the source (s) of the regulations in this chapter. However, e ote c n 50 8 a s's d funds to cover these costs. no consideration of financial under sec.122. 68 Stat. 939 (42 U S C. 2152). Sections 50 m-50 81 afsc issued under sec. (i.;If the application is for an qualifications is necessary for an 184. 68 Stat. 954. as amended (42 U.S.C. 2:34). operating license, the applicant shall electric utility applicant for a license for Sections 50100-50102 issued under sec.186. submit information that demonstrates a production or utilization facility of the 68 Stat. 955 (42 U S C. 2236). For the purposes the applicant possesses or has type described in 150.21(b) or $ 50.22. of sec ::3 68 Stat 958. as amended (42 U.S C. reasonable assurance of obtaining the funds necessary to cover estimated

9. In 150.54, a new paragraph (w) is 4

nd 50 8 ( re s e unde sec. operation costs for the period of the added to read as follows: 161b. 68 Stat. 948 as amended (42 U.S C. e e y hu t e a li down 150.54 Conditions of Acenses. e nder c toti Sta 9 amended (42 U.S C. 2201[il). and il 50.55(e), and maintaining it in a eafe condition. 50 59{b). 50 70. 5071. 50.72. and 50 r8 are The applicant shall submit estimates for (w) Each electric utility licensee under issued under sec.161o. 68 Stat 950, as total annual operating costs for each of this part for a production or utilization emended (42 U.S C. 2:01(o)). the first five years of operation of the facility of the type described in

6. In i 50.2. a new paragraph (x)is facility and estimates of the costs to 5 50.21(b) or i 50.22 shall. by June 29.

j added to read as folinw s-permanently shut down the facility and 1982, take reasonable steps to obtain on-maintain it in a safe condition.The site property damage insurance i50.2 Dennitions, applicant shall also indicate the available at reasonable costs and on As used in this paM. source (s) of funds to cover these costs. reasonable terms from private sources An application to renew or extend the or to demonstrate to the satisfaction of (s)" Electric utility" means any entity term of an operating license must the Commission that it possesses an that generates or distributes electricity include the same financialinformation equivalent amount of protection and which recovers the costs of this as required in an application for an covering the facility, Pmrided. that: electricity, either directly or indirectly, initiallicense. (1)This insurance must have a through rates established by the entity (2) Except for electric utility minimum coverage limit no less than tha itself or by a separate regulatory applicants for construction permits and combined total of(i) that offered by authority. Investor-owned utilities, operating licenses, each application for either American Nuclear Insurers ( ANI) including generation or distribution a construction permit or an operating and Mutual Atomic Energy Reinsurance subsidiaries, public utility districts. license submitted by a newly. formed Pool (MAERP) jointly or Nuclear Mutual municipalities. rural electric entity organized for the primary purpose Limited (NML); plus (ii) that offered by

sm Fed;r:1 R; gist:r / Vol. 47. Ns. 82 / Widn:sday, Mrich 31, 1962 / Rules and Regulations 13755 Nuclear Electric insurance Limited financial protection it maintains and the

12. In Appendix M to Part 50, (NEIL). the Edison Electric Institute sources of this insurance or protection.

paragraph 4.(b)is revised to read as (EEI). ANI and MAERP jointly, or NML

10. In i 50.57, paragraph (a)(4)is follows:

as excess property insurance: revised to read as follows: Appendtz M-Standardisation of Design. (2) The licensee shall, within ninety Manufacture of Nuclear Power Reacsore, IM7 l**uanC* Of OP*r8tiall Construenos and Operation of Nuclear Power (90) days of any increases in policy Reactors Manufactured Pursuant to limits for primary or excess coverage (a) * *

• that it has obtained pursuant to this (4) The applicant is technically and paragraph, take reasonable steps to financially quahfied to engage in the q,),,,

obtain these increases; and activities authorized by the operating (b) The financial information submitted (3) When a licensee is prohibited from h, cense in accordance with the pursuant to 150.33(f) shall be directed at a purchasing on site property damage regulations in this chapter. However, no demonstration of the financial quahfications insurance because of state orlocallaw, fmding of financial qualifications is of the appbcant for the manufactunns beense the licensee shall purchase the specific necessary for an electric utility to carry out the manufactunna actmt> for h amount of such insurance found by the applicant for an operating license for a f'h 'h' I'C'"" I' "8 NRC to be reasonably available to that production or utilization facility of the Dated at Washington, D C, this 24th day of licensee, or to obtam an equivalent type described in 150.21(b) or 150.22. March 1m amount of protection, and For The Nuclear Regulatory Comm:ssion. (4) The licensee shall report on April 1 Appendix C-{ Removed] Samuel ]. Chilk, of each year to the NRC as to the ,9,,7, present lesels of this insurance or 11 Part 2 is amended by removing ouma coot rose-es.m}}