ML20093H638
| ML20093H638 | |
| Person / Time | |
|---|---|
| Site: | Midland |
| Issue date: | 07/24/1984 |
| From: | Starszesky F BECHTEL GROUP, INC. |
| To: | Harold Denton Office of Nuclear Reactor Regulation |
| References | |
| NUDOCS 8407250217 | |
| Download: ML20093H638 (4) | |
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Bechtel Power Corporation
'3 Engineers Constructors i
1620 Eye Street, NW, Suite 703 F. M. Staszesky, Jr.
WasNngton, DC 20006 Manager of Government Relations Power July 24, 1984 J
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Mr. Harold R. Denton Director Jl Nuclear Regulatory Commission 1717 H Street, N.W.
Washington, D.C.
20555
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Dear Mr. Denton:
i Last week, the Consumers Power Company Board of 1
Directors in Jackson, Michigan was forced to cancel
.j the Midland Nuclear. Power Station.
We at Bechtel
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.i believe this event represents a tragedy of national proportions and we are sure it is of concern to you as i
-j a senior member of the Nuclear Regulatory Commission.
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'l Midland represents the fifth and sixth nuclear units I
j to be abandoned or suspended in the central industrial
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region so far this year.
At this point, each new lj cancellation announcement sends a wave of apprehension l
through the financial community and a shock of alarm
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~ through the utility industry.
True, there have been
'I numerous cancellations before; but there are major i
j differences.
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Until now, the units had not started construction or were in early phases,'so that a cancellation did not
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create the dilemma of who would pay the enormous costs of a nearly completed and abandoned facility.
i Furthermore, until recently, the cancellations only
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served to reduce large generating reserve margins.
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Now, however, almost every cancellation creates an
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economic and social tragedy of sunk cost responsibility undermining the financial integrity cf the-utilities, j
Each event reduces reserve marg!ns to the point where
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load growth only slightly above forecasts will create shortages in the early 1990's..In fact, for the past
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52 weekn electric production.has grown at 8.3% in
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contrast to an aggregate industry forecast over the
<J next decade of only 2.7% per year.
We at Bechtel are f
l extremely concerned over an acceleration of plant L
j cancellations and foresee a potential for a domino l
effect of electric utility bankruptcies, i
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Attached is a copy of a letter by Bechtel Power i
j Corporation. President, Harry O. Reinsch, to Bechtel i
employees describing the circumstances surrounding the j
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cancellation of the Midland project.
As Mr. Reinsch f
l points out,.the time has clearly come for changes to j
be made in the electric utility regulatory process to i
protect the interests of the majority of Americans
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against the small cadre of no-growth special interest
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groups who now dominate the energy regulatory
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process.
Worse yet, under the current system of j
l regulation these groups are totally unaccountable for i
their actions.
For the past several years, we at Bechtel have become j
increasingly concerned over the course of events which l
results today in an electric utility industry j
financially hamstrung and unable to meet its future f' i obligations to customers to provide needed supplies of electricity at a reasonable price.
We feel now that
-l the utility industry stands on the precipice of a
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catastrophe.
While some may not view this as the j
condition on a near-term basis, long-term consequences are being set in motion based on today's decisions.
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As such we feel that responsible organizations and fj individuals can no longer ignore this problem and assume that some miracle will occur to make the
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problem go away.
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By this letter, we would like to take this opportunity 5
i to call on your support to bring to the attention of l
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the American public, concJress and the Administration j
the concern which we feel you share with us over the j
serious implications a shortage of electricity in the
.s United States would entail.
The time has clearly passed when responsible organizations and individuals I-f can stand idly by and watch a situation develop which could result in a stagnation of our economic growth 1
and a threat to our national security.
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llAltitY REINSCll PRESIDENT, llECIITEL POWER CORP.
A TRAGIC LOSS To:
All Bechtel Employees The decision to shut down construction at the htidiand Nuclear Power Project is a tragedy.
That shutdown will have an adverse impact for more than three decades on hiichigan.
It obviously also has an immediate adverse impact on Bechtel Power Corporation.
The bildland plant remains today a sound effort and one which should have a place in meeting hiichigan's power needs and providing the additional electricity capacity necessary to sustain our future economic growth and create jobs.
- Instead, the tremendous investment of manpower and money is being wasted.
The costs to htichigan are staggering and will be felt for years:
Initially an investment of $3.5 billion already on o
the ground will be wasted.
o over the life of the htidland plant, hiichigan will pay $11 billion more for alternative energy supplies than if htidland were completed, o
hitchigan soon will lose 4,450 jobs related to the construction and 5,000 permanent jobs the plant would have created.
Bechtel has 3,350 jobs directly related to the project.
Subcontractors have 1,100.
o hitchigan taxing agencies will lose $2 billion in taxes the plant would have generated.
The demise of hfidland ultimately was brought about by a virulent no-growth anti-power lobby seeking to weaken the very society in which it lives.
That group has taken upon itself the responsibility to decide that power supplies for growth are not needed.
Under the current system it can be frivolous, deceitful and even malicious yet never be held accountabic for the impact and monumental costs it causes.
The no-growth anti-power lobby must be held accountable for its actions.
l The overwhelming majority of the American people continues to i
pay for the actions of those few who abuse the system.
Clearly changes must be made by Congress to protect the interests of l
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, the majo ity of Americans against the small no-growth anti-power-lobby.that now dominates the regulatory process.
Weregret/Ehat'theUoalitionseekingashutdowndidnotseefit
.to acceptsproposals by Consumers Power Company to continue
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--construction, which included a substantial assistance package by.the Bechtel Power Corporation.
Neverthele s, the Consumers Board of Directors acted in good f aitheand we' must accept-its decision.
We want to assure our employess thatsC.onsumers decision for abandonment was one it attempt'ed'toyavoid at all costs, and Bechtel's Ann Arbor Power.
Division mustanow begin the_ demobilization process.
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We are p'repare'd -to initiate an orderly, step-by-step shutdown andHwork to keepgas many of~our employees as we possibly can.
Arrangements _-are.i Aun Arbor Power Division offices andal~ ready made in many cas employees to'othe
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.jobsites,'as wb11 as to other' assignments in the worldwide Becht.91 organization. ' Employees will report to work as usual for instrGetions from their~ supervisors.
Otherestep(includeoureffortstoassist layoff candidates to communicutc with potential employers; Consumers Power has 4
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agree'd'to support a' job fair at the. Midland jobsite in the near future.
We salute the thousands of engineers,. craft workers, technicians, secretaries, and all other' skills who worked with dedication on the project.
We strongly believe that it is
-imperative,that the investment of Consumers Power and the fine
' efforts of tho~ Midland Project team not be lost as a resource.
We will continho to work with ConsumersxPower to see that this plantjwill not;be closed forev,er.
, Sincerely, s
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, Harry O. Reinsch
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PLEASE SHARE THIS INFORMATION WITH THOSE UNDER YOUR SUPERVISION Volume 10,.No.18
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July.17. 1934._
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Mr. Harold R. Dentcn Director E'
Nuclear Regulatory Ca missicn I,
e 1717 H Street, N.W.
i Washingtcn, D.C.
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