ML20063E538
| ML20063E538 | |
| Person / Time | |
|---|---|
| Site: | Midland |
| Issue date: | 08/24/1982 |
| From: | Stamiris B STAMIRIS, B. |
| To: | Atomic Safety and Licensing Board Panel |
| References | |
| NUDOCS 8208300291 | |
| Download: ML20063E538 (9) | |
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sin DOCNETED USNRC 1E! AGO 27 P2:40 i
CFflCE OF SECP.ETARY U. S. Nuclear Regulatory Commission gh, ifC In the Matter of Dochet Nos.
CPCo. Midland Plant 50-329 OL Units 1 & 2
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50-330 OL BEFORE THE ATOMIC ' SAFETY AND" LICENSING BOARD NEW STAMIRIS CONTENTION. BASED ON FES-8/24/82 (All page references-in parenthesis refer to FES pages.)
CONIENTION I contend that the new cost production, cost savings analysis of the FES, represented by revised table 2.1 (p. A-32) and the revised cost / benefit analysis (p. 6-4) and revised _ economic statements derived therefrom do not accurately and fully represent the cost / benefit balance of the Midland plant to the public, and should therefore not be accepted as presented.
UNREPRESENTATIVE AND INCONSISIMTT METHODOLOGY IN PRODUCTION BASIS I:
COST ESTIMATES The bases for contending that these new FES statements are inaccurate and incomplete Are numerous. First, the NRC chooses to use the most favorable (ie.
least costly) 1984 production cost data rather than the most representative but less favorable average of 1984-1988 production cost data in their table 6.1 (p.
6-4).
At the same tine the NRC uses the 1984-1988 average rather than 1984 data alone to represent the cost savings data.
Rather than use a consistent method-8208300291 820824 PDR ADOCK 05000329 O
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ology to represent cost / benefit data, the NRC has chosen to use whichever approach offers the most favorable presentation to plant operation.
By way of explanation, the NRC's use of 15 mill /kwh (fuel) and 6 mill /kwh (0&M) production costs (p. 6-4) is based on a 1984, 56% capacity figure (p. 6-3 par.1) for a total cost of 21 mills /kwh to produce electricity.
In so doing the NRC goes beyond even accepting the new table 2.1 data at face value by enhancing its presentation in table 6.1.
The NRC should use a 13.8 mill /kwh (fuel) and 12 mill /kwh (0&M) averaging of 1984-1988 data for a total of 25.8 mills /kwh to produce electricity, based -on an average capacity factor of 54%. Even the appli-cant suggests using the 54% capacity average (p. A-30 #15) to replace the staffs.
DES 58% average capacity factor (p. 2-2 DES), but the staff abandons their averag-ing approach to use. the 1984 data alone.
BASIS II:
IACK OF SUPPORTING DATA FOR PRCDUCTION COST ESTIMAIES If the staff were to accept Consumer's new production cost data and comments-at face value, this would still not meet the. public interest regarding a complete and accurate representation of the costs and benefits of operating the FEdland plant, for the supporting-bases used to justify Consumer's submission of new data ~
in revised table 2.1 are not provided or analyzed.
Consumer's cites the change in Dow's steam reservation and their~ 12-14-81 load forecast revision as bases for their new replacement energy estimates (p.
A-31, #16) which account for the increased savings from $200 million/ year (DES) to $279 million/ year (FES)' in table 6.1, yet no documentation or explanations of these bases are included in the FES in order to assess the validity or necessity of the proposed changes prior to their acceptance.
BASIS III:
" SAVINGS" AS AN ACTUAL BENEFIT IS INVALID The revised FES average cost savings of $279 million per year (based upon note (e) in revised table 2.1, p. A-32) is represented in, FES ta'ble 6.1 (p. 6-4) t_
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4 as an actual benefit in " reduced generating costs" and is judged to be a "large" benefit in the overall cost benefit analysis.
As stated in paragraph 2 p. 6-2 FES, "the benefits and costs of operating the plant are summarized in table 6.1" (emphasis added).
Yet the dollar figure of $279 million per year actually represents the projected costs of not operating the Midland plant.
As such these replacement energy costs have no place in an analysis which purports to represent the costs and benefits of operating the Midland plant.
The hypothetical energy savings are counted as actual dollar benefits "that will accrue from operation of the plant,'.' (par. 4, p. 6-2) which they are not.
Such an accounting is analagous to creditirig your personal checkbook with " savings"
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from the money you didn't spend,as though it were a deposit. Consumer's Power
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Co. cannot be allowed to take economic credit for not operating the plant, in a cost benefit analysis considering plant operation.
BASIS IV:
COST SAVINGS INCREASE IS NOT JUSTIFIED Even if the existance of a cost-savings figure, represented in' Table 6.1 as reduced gene' rating. costs, is allowed to remain in the FES cost-benefit analysis,-
the significant increase from the estimated $200 millicn savings per year in the DES, to the $279 million savings per year. in the FES is not justified.
The basis for this significant increase between the DES and FES cost savings estimates is due to the corresponding increase in replacement eriergy costs (in tables (d) below table 2.1 p. 2-3 DES, p. A-32 FES) as submitted by CPC. As noted in my basis II argument about production costs, these increased replacement energy costs are unsupported by documents or explanations.
In addition the question must be asked regarding the increased cost savings; why would CPC maintain an average 70% reliance on purchased power, (as opposed to the more economical coal power, tables (d) below tables 2.1) if the projected cost
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u of purchased power rose from an average of 50 mill /kwh (DES) to 71 mill /kwh (FES) as it does to produce the increase in cost savings between the DES and FES? An opportunity is needed for both parties to produce evidence on this issue, for there is data available showing that the use of the coal option for replacement energy has not been cost-efficiently taken into account.
(By this suggestion I do not raise need for power or alternate energy arguments, only costs of replacement power. as CPC does.)
BASIS V: COST CONSIDERATIONS ALLOWED ONE -PARTY CANNOT BE DENIED ANOTHER PARTY In the economic revisions implemented between the DES and the FES as reflected in section 6, CPC is allowed to take account of "recently revised plant and produc-tion cost data based on the latest cost forecasts" (p. A-28, #3) for its revised estimates of increased benefits, while avoiding any accounting of analagous increased costs in the cost / benefit analysis table 6.1.
The data and substance of> these new cost forecasts used as bases for the revised benefits is not produced, explained, or analyzed--but is accepted by the NRC in -
adopting the FES changes to table 6.1.
It is obvious that CPC and the NRC have been allowed to make extensive use of all beneficial cost data in their revised cost benefit analysis of the FES (even non-existant annual cost-savings).
The selective application of cost considerations in an analysis perforned for the public which excludes the most significant of all the real costs that the public will accrue with the operation of the plant--ie, construction costs, is blatently unfair and does not represent the public interest.
For according to bachigan Public Service Commission policy, the construction
, costs of the Midland plant will becone a part of the operating ratebase--only when the plant produces the power for which it was intended (see attachment A).
The NRC states that their section 6 analysis represents "the benefits and costs of operating the plant." Unless we are to believe that this analysis represents
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the costs and benefits to the utility as opposed to the public, the construction costs cannot be considered " sunk costs" by any stretch of the imagination in Michi-gan.
Likewise the exclusion of constructien-cost economic considerations on the bases of the argument that construction costs have already been considered at the c.p. stage, while promulgating new economic benefit considerations from new cost forecasts (p. A-28, #3), is inconsistant.
Furthermore the recent Commission. observation that " factors such as increased financial costs since the c.p.. review should generally not be considered at the 0.L. stage, since such factors would be unlikely to tip the cost benefit balance 4
against issuing an 0.L. (emphasis added, 47. Fed. Reg. 12940-42 3-26-82) clearly leaves room, in its use of qualifiers,- for.the exceptional cost. increase circum-stances which Midland represents. -
_. 2 For construction cost estimates considered at-the c.p. stage for Midland
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were only $265 million, as compared to the not yet final cost estimate of $3.39 billion today, an increase of over 1000 percent which cannot be ignored as an outstanding cost increase to the public who will begin to pay it only when the plant operate s.
If the applicant presents the same explanations of "the manner in which construc-tion costs were in fact accounted for in the environmental cost-benefit analysis at the OL stake of review" (tr: 8386-88, 8392, as cited in the Boards 8-14-82 order,
- p. 26) to this contention as he did at the recent prehearing conference, I will strongly object to the acceptance and these or any other arguments which go to the merits' of the" contention, without an equal opportunity to explore those merits myself, for I consider them erroneous, and misleading and I could produce evidence to support my contrary point of view.
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6 BASIS VI: NEPA REQUIRE!ENTS -
Mr. Bishop raised arguments at the prehearing conference of Aug. 13,-1982 concerning the ' necessity of considering the whole cost / benefit picture according to NEPA requirements,* something that wasn't done at the c.p. stage, and something that is not done in the selective use of new cost forecasts taking place with the FES economic benefit revisions already discussed. These NEPA arguments must be taken into accot.nt in support of the portion of my contention which asserts that the revised FES cost / benefit analysis is incomplete, and therefore unacceptable in its present form.
CONCLUSION
.Throughout the statement of this contention and its supporting bases, I have dil11 gently avoided raising any need for power or alternate energy arguments.'
I seek only the full and fair consideration of economic costs and benefits associ-ated with the operation of the Midland nuclear plant assuming that its power is needed and that there are no environmentally superior alternatives.
I seek only to be allowed the same rights as other parties in the consideration of relevant costs an:d benefits to the public which will accrue from the operation of the ' Midland plant, and in considering them in a consistant and equitable manner.
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On the basis of the foregoing considerations regarding the decreased validity of the FES, cost / benefit analysis and section & conclusions, as compared to the DES analysis and conclusions, and the overall inaccuracy and incompleteness of
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these economic considerations, I hereby seek to have this new contention admitted in the OL proceeding, i
At the very least, this contention should be admitted for the purposes of discovery to clear up the apparant inconsistancies in data usage addressed in the i
- My lack of a transcript does not allow me to be more specific at this time.
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I contention.
If appropriate the contention could then be restated, resubmitted or dropped.af ter the close of discovery on the basis of information obtained therein.
Respectfully Submitted, STATEMENT OF GOOD CAUSE FOR FILING OF NEW CONTENTION ON 8/24/82 On August 10, 1982, I received the FES. This submission of this new contention thus falls within 14 days,of the date I received the newly issued staff document on which it is based.
According to the Boards May 7,1982 order (p. 4) I have met the part 7 time requirements (even according to the February 23, 1979 order) for the filing of new' contentions based on new information in recent staff documents, to which the Board indicated they would be prepared to entertain proposed modifications.
I have made a concerted effort to meet the 14 day requirement despite the prehearing conference and my ongoing discovery obligations, so that in case my contention is construed to be an extension of my existing contention 1, I will still have met the Boards time requirements of part 6 of the May 7,1982 order.
My contention is clearly based upon new FES infor,mation and analysis to which I did not previously have access (2.714a).
My interest and the public interest in pursuit of this contention will not be protected 2by the NRC who has produced the contested statements and analysis
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(2.714b), or by any other intervenor since no similar contentions are accepted
.(2.714d).
My participation on these economic matters may be reasonably expected to help develop a soimd record as it was for my contention Ib (p. 24, 8-14-82 order) in that it requires more a gathering of relevant information than a technical or scien-tific expertise as so many of the OL issues do.
I have established a personal file of -Midland' plant and Michigan policy documents related to these economic issues,
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i 9-t upon'which I re ly.
I have established contact with several knowledgeable people in Lansing who will likely~ be able to assist ne in pursuit of this contention.
There is even a likelihood of my being able to produce a witness on these issues (2.714c).
Lastly, discovery on these issues would not be likely to delay the anticipated late fall OL hearings. Although the litigation of contested economic issues such as I have raised would add slightly to the overall hearing length (by perhaps a day),
it would not significantly broaden the accepted OL issues.
In fact, only by permit-ting discovery upon and if necessary litigating the economic issues raised inaccur-ately, or incompletely in the FES cost / benefit analysis and related statements, can these questions, which significantly affect the public interest, be resolved (2.714e).
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Barbara stamirls 5795 N. River Road Freeland, MI 48623 cc. ASLB members W. Paton, NRC M. Miller, CPC Secretary, NRC l
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STATE OF usCMGAN PUBUC $tRV1CL COMMIS*A 654) utftCANiitE wAv Den.*' J O* mace.Chewmen P O son 3c77 Amnessedh aensumes, LAN$svG McMiGAN 4epoo 8tmedeme ssemig WLLuM o wiLLMEN. Gove no' crie J. Schneidewind DEPARTMENT OF COMMERCE ouaur.uamanuN. %
f' Tebruary 26, 1980 No. Barbara stamiris 5795 North Jtiver Tsweland, ME 40623 Dear Ms. Stamitist I am writing in response to your lettes dated February 12, 1980.
In i t, you asked for information on the so,sice of financial support for uncompleted electric power plants, specifically, Midland Nuciear Power P1 ant.
It is a long-standing regulatory practice of this Commission that a utility may not earn a rate of return, i.e. obtain eaznings, or recover the overall cost of construction of that facility until it ir deemed "used and useful" in its basic purpose.
That is in keepir.g wi t.o the assumption by the utility of the risk for construction and of ma. cing denund.
Hence, Midland has not and is not in the rate base.
Let me poin t out, however a very small exception.
Through o
rather complex accounting measurcs, two offsetting accounts do not balance and a small portion of the plant cost is supported by ratepat.. rs.
I estinute that this burden on a typical residential customer is' an anoun t equal to less than one percent of the monthly customer charge.c for electric service f rom consumero Ewwer rnt-pany I hope that you find this an adequite answer to your quest ion.
Very tru,y yours,
. M..._
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Daniel J.
vomlow
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