ML20114E697

Confirms Inquiry Re Status & Interpretation of Antitrust License Conditions in Proceeding 60-415-57

ML20114E697
Person / Time
Site:	Grand Gulf
Issue date:	09/22/1978
From:	Mcdiarmid R SPIEGEL & MCDIARMID
To:	Urban J JUSTICE, DEPT. OF
Shared Package
ML20114E688	List: ML20114E694 ML20114E697 ML20114E699
References
NUDOCS 7907110337
Download: ML20114E697 (7)

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Janet Urban, Esq. Septencer 22, 1973 a.-..' 3.' -

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li:ed to sell partial require =en:3 pcwer a: an TERC rate to

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and Greenwccd, Mississic=.

On July 10, 1977, Clarksdale *: led a Peti:icn to intervene in the FPC decke in vn:ch MPs; had filed :ne interconnection agreement witn Clarksda'.e en June 7.

Clarksdale ncted snat the agreenen in ques:icn wr.a an c u t,.-. w..'. c'.'

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ditions to its AEC license and that in the view cf Clarksdale t.". e '... e. ~. ~... n. a. c..'.. a g. *. *.. a..... e. s.. *. c.

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. ec.4c agreemene is inadequate and that it will seek :..e addi:icnal service schedules which are believed necessary and unich i:

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• 9, 1977, :ne Mav.er cf. Cla rksda'.e, Mr.v. ::

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a alia, sna: 30 far as Clarksdale's reccrds snewed, nc :-der Of

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r-o.... a s.'..,.. a s e lead pcwer and energy 'r:n MPs* under MPLL's wnciesale f *ed rate.

Mav.er '4e: ster nc ed :ns: "'.srkeda'.e wcu'd nave :a:a-w '.v. e. x.- a. s s...'..... a. a.' s.. a. s. s ".'. a. d. '. -

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. Janet Urban, Esc.. September 22, 1978 1

6 a resttit cf the national policies which had deprived Clarksdale of the gas supply upon which i: had relied in the constructicn of its generatien, and inquired as to the transmission rate which R?s* would apply to the sale of unit capacity by Clarksdale er purchase by Clarksdale to ce frem c her entities interconnected with the Middle Scuch Transmission System.

On August 13, 1977, Mr. Lutken, President of MPs*, respended to Mayor Webster suggesting that Clarksdcle had never expressed an interest before in,ar-ticipation in the Grand Gulf Unit and therefore participatien woud be difficult if not i=pcssible but na: the Cc=pany was willing :o discuss the matter further.if desired.

The letter suggested : hat a better epproach =ight be to censider the ecssibility of su =Ivane. Clarksdale's needs :em=crariiv.

pending the planning and c nstruction of fu:ure generating facilities and tha the present inter:cnnec::ca agreemen:

provided a schedule for that.

He later noted, hcwever, that energy availa:1e under these schedules wculd be at the incre-

= ental rate for the entire Middle Scu n System, then esti-mated to be in a range :etween 5.0 and 67 per.swh.

The Company offered := consider.the purchase cf Clarksdale's excess capacity for.eakinc.. cur cses and rec.uested addi-r tienal infor=atien.

also stated its willingnese tc deve-ic; a propesci for ::ansmissien service to Clar.'ssdait and requested an idea as te the maximum quantity cf pcwcr under c a n s.' ~' e. a. '..

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• transmission sys*e3.

a Mayer We:s:er respenfed September 3, 19 7, again

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Gulf plant, and requesting an cpper: unity for Clarksdale :

purchase base 10ad electricity ericed at its appropria e c:s:

cr to purchase approxima:ely 19.5 =c;awa::s of capacity frc:

Mississippi ?:ver s L gn: a: estabitshed TPC wnciesale ra:es.

Several meetings were held :etween Clarksdale and M?s*,

ceginning en Cet::er 16, 19 7' prepara:Ory to that mee-ing, Maver We: ster had furnisned to Mr. Lu: ken a letter cf Oc:: er 18, 1977, specifying in scre detai. seme of the matters whi:n Clarksdale wished to achieve.

Clarksda'e has no vis: ::

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• at these series cf meetings, but i: is clear tha: no effer cf participa:icn in Grand Oulf has been Or is li.<ely to be made; that MPSL has declined :: purchase ;cwer er energy fr==

Clarksdale er te sell base 1 cad ;cwer er energy ce pcwer and energy under L:s TIP.C filed rate :: C*arksdale even theugh it can be shown that such transactices woulf be advantagecus :=

its sharehciders; bu: MPs* did file a pr:pesed transmissica

Jane: Crean, Esq. Septemcer 11, 19 3 r$

rate for Clarksdale en August 23, 1973, in FERC Cccke

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IR73-553, tec.e:her with a similar rate for the City of Greenwced, M:ssissicc.i in ::ccket E 17 9-5 8 4.

While Clarksdale believed certain aspects of tha: rate filing te be cypressive and unjus: and unreascnable, and filed a Prc:est, Pe :::en ::

Intervene and Recuest for Cne-Cay Suspensica en Septe cer 15,

1973, Clarksdale aisc believed tha:

would te scle :: uti-

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frem the extremely high energy costs wtich it was # creed to incur purchasing hign ecs: cil to ccerate its units in a situatien wnere base icad pcwer and energy were nc: avaiiacie frem any c her source.

Consecuen !v, Clarksdale entered an a q. a. a.

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purchase of sc=ewnat :cre than 14 megava::s of capaci y, and t '. a.

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frc= *.a'av.e::e to MPs. over the s"s em of Gu'."

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By letter of Septe:cer 3, 1973, Maycr Wecster

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pcwer and energy as,,quickly as pcssible, and aise ine" ired 4

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i. Jane: Orcar, Esq. <septe==,; :2, '373 e

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By tele;hene conversatien Of Septe=cer 19. ;??2, however, MPEL advised Clarksdale that i: vculd ne te possible under any circu= stances to receive energy fr:=.32;f

' Stat:s until ar. Inter:cnnecti:n agre;e=ent :etween M?sL1and Gulf States could be' worked cut, and that this neget:sti:n might be quite lengthy.

hus, MPs* ! suggested tha: O'arksda'e (cr; Lafayette) centract wa-h icuisiana Pcwer i Light f:: se r- -

vice under *PEL's transmission senedule in add::::n :: :he transmissien ra:es, ter=s and cend :::ns with vni:n Clarksdale wculd have to cc= ply airyady with Ocif States and MPEL.

Since none of 01arksda'e's advisors ::c'd understand a legitimate basis 'er such pcsitten, piarksdale, by le :er Of Septe=cer: 20, 1973, requested a written explanati n of MPsL's

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r such a wri: en explanation, but at appr:xt:stely 5:00 PM hat afterncen, sta ed that inas=ach as the 00.,;any's re' usa

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r such a le::er.

As may be seen "r:s the accve, fespite diligent applicati:n and su stantia**y =cre actres;cndence than is cutlined accve, althcugn 0*arksdale has requestof who'esale service en a partial requirements basis under TI?.0 tariffs, MPEL has declined :: prev;de such service, a ;csitien wnien O'.arksda*e believes incensisten w;;h M?s*'s :=*igatiens u rder the License C nditi:ns.

A1 heugh Clarksda'e 'and ceners; have repeat, ed'y reques. t,ed ::a: an effer :f par-

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a.d Clarksdale has been given ne ressen :: expe : ::at'sa-t an offer will.a.e =ade, a ;cs.tten wnichlClarksdale :e*1 eves ::

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w althcu dule, gh MPEL nas finally f: led a transmissi:n servi:e sche-1: has ch sen :: interpre: its : serv :e senedule in seen a way as to effectively preclude the:acility Of ~' ark:da'e :=

cetain cac.act:v. and energy which wcuid :e ec:nes : f::

Clarksdale even v'th the payment Of two " pancake

• transmissica rates, insisting tha: Clarksdale en:er in : an agree =ent wi:h its cer;ces:e af'i'iate ;Pn; as we'1, and pay both of these M ddle Scuth "tilities' affiliates even tucugn the Middle Scuth System 1:self, vnich is believed :: have an inter:ennection agree =en with Culf States, per= :s a free-ficwing ce,n, trally c;e, rat.e,d tran.smissien cpera:ic,a :ver and

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w Clarksdale :elieves :his, as well, :: be ine:ns:s:ent w::

MPnL's li:ense cligations.

.i) l Janet Ceban, Esq. Septe=ter ::, I? 3 Cn =ehalf cf the *ity cf "larksdale, this v.?,1 s e.v a.

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herein, to :e consisten vi:h the agreemen: reacned-te:veen Justice and MPEL emecdied as the Grand Gulf License Co*at*.=ents.

If the Department dces te'.ieve these ;cs:. :. ns

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Section'.'05 of the A::mic Energy Ac: Of-1954, and i:s ;csi-tiens rev' sed.

I' the Oepart=ent :elieves that these ;csi-t.' ons a -a...o.... s ' s. e......'..'. s a 3. e a.e. w i..'..M P =.*,.". '. s wi.'.'.

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2 Department dces in such si::ati:ns :: enforce its agreemen:s.

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