ML20115J555

City & County of Midland,State of Mi Response to Aslab 850313 Order to File Memoranda Re Whether Aslab Should Vacate ASLB Decision Re Certain Mods to CP Due to Mootness. Proof of Svc Encl

ML20115J555
Person / Time
Site:	Midland
Issue date:	04/19/1985
From:	Phillips T, Pirich J AFFILIATION NOT ASSIGNED, MILLER, CANFIELD, PADDOCK & STONE
To:	NRC ATOMIC SAFETY & LICENSING APPEAL PANEL (ASLAP)
Shared Package
ML20115J545	List: ML20115J542 ML20115J555
References
OL, OM, NUDOCS 8504230610
Download: ML20115J555 (13)

Text

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UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION DOCK TED BEFORE THE ATOMIC SAFETY AND LICENSING APPEAL 15 APR 22 mi:i8 In the Matter of )

) OTF;0E Gr !Ecq;f I E CONSUMERS POWER COMPANY ) Docket Nos. $bNhk'-hl'"& OL

) 504350 OM & OL (Midland Plant, Units 1 and 2) )

)

MEMORANDUM OF THE CITY AND COUNTY OF MIDLAND, STATE OF MICHIGAN WITH RESPECT TO APPEAL BOARD ORDERS OF APRIL 5, 1985 AND MARCH 13, 1985 I. INTRODUCTION -

g By order of March 13, 1985, the Atomic Safety and r,i g Licensing Appeal Board (" Appeal Board"), directed the parties in these matters to file memoranda by April 1, 1985, f

addressing whether the Appeal Board should vacate the Atomic

$ Safety and Licensing Board's (Licensing Board's) decision with respect to certain modifications of the construction permit for the Midland project ("LBP-85-2"), on the basis of mootness and, thereby, strip the Licensing Board's decision of any precedential effect. The Appeal Board also asked the

, parties to address why it should not remand the operating I license portion of these proceedings to the Licensing Board, with instructions to the Board to dismiss the application of Consumers Power Company (" Consumers") for an operating license, due to of consumers' " failure to pursue it."

Several memoranda were submitted to the Appeal Board addressing these issues. However, the Appeal Board j concluded in its Order of April 5, 1985, that the memoranda l

b$ 9 m

of Consumers and the Nuclear Regulatory Commission ("NRC")

Staff failed to adequately respond to these issues. (April 5, 1985 Order, pp. 2-4). The NRC Staff and Consumers were given until April 19, 1985 to file supplemental responses by the April 5, 1985 order of the Appeal Board.

On April 19, 1985, the City and County of Midland, State of Michigan, filed a Motion for Leave to Participate as Amicus Curiae under 10 CFR 2.715(d), seeking to be allowed to address the issues raised in the Appeal Board's Motions of March 13 and April 5, 1985. Thic Memorandum constitutes Midland's response to the issues raised by the I3 Appeal Board.

i g II. MIDLAND'S INTEREST IN THIS PROCEEDING d

j The City and County of Midland, as municipal 5

= corporations, purchase electrical power from Consumers, as 5

do all business enterprises and all natural persons located within their boundaries. The City and County of Midland are responsible for the continuing economic vitality of the residential, commercial, and industrial users of electrical powers within their boundaries. Both the City and County of Midland are concerned that their future development --

industrial, commercial, and rcsidential --

will be threatened by the absence of a sufficient supply of power if the Consumers' Midland nuclear project is not completed. In this regard, Roger Fischer, Chief of the Michigan Public Service Commission Staff, has given testimony in Rate Case l

O No. U-7830 (Midland), before the Michigan Public Service Commission, that the Midland nuclear project should be completed to ensure that Michigan will have sufficient power for its citizens in the 1990's and beyond.

In addition, both the City and County of Midland have greatly benefitted from the Consumers' nuclear project in terms of property tax revenues since 1969. The property taxes which Consumers has paid to both the City and County of Midland have constituted a major source of the total budgets of each. The Midland nuclear facility, even in its shutdown state, has produced major revenues, which revenues 5

a continue to have an enormous, if not critical impact, on the 9

0 economic vitality of the City and County of Midland.

With the shutdown of the Midland project in July, 1984, d

j the City and County have become actively involved in a

g protecting the interests of their citizens. This i involvement has included intervening, and presenting evidence, in Michigan Public Service Commission Rate Case No. U-7830 and U-7830 (Midland), both of which have addressed, either directly in terms of construction costs or indirectly in terms of immediate rate relief to Consumers, the impact of the Midland facility on Consumers and its rate payers. Further, the City and County of Midland have expended, and continue to spend, substantial sums on a study to analyze the feasibility of some entity other than Consumers completing the Midland project.

It is within this framework that the City and County submit this Memorandum.

III. THE PUBLIC INTEREST WILL NOT BE SERVED BY VACATING THE LICENSING BOARD'S DECISION WITH RESPECT TO THE CONSTRUCTION PERMIT MODIFICATION NOR BY ORDERING THE DISMISSAL OF CONSUMERS' APPLICATION FOR AN OPERATOR'S LICENSE Although the Appeal Board has described the Midland nuclear damage as "at the very least deeply comatose", the City and County of Midland believe that there are good prospects for finding a purchaser of the Midland facilities who will complete the project. . This belief also appears to 5

m be held by both state and federal regulators. To a large 9

0 extent, however, the ability of the City and County of g Midland and Consumers to interest potential investors in the d

l purchase of the nuclear facilities turns on their ability to 6

g show potential investors that construction of the facilities can be completed and an operator's license obtained for the plant. The feasibility study which the City and County of Midland are currently undertaking is premised on the notion that any potential purchaser of the nuclear facilities will be able to complete the construction within the parameters of the construction permit as ordered modified by the Licensing Board. If the Licensing Board's decision is vacated, it would likely be impossible to attract investors for the nuclear facilities. A ninety-six day evidentiary hearing has already occurred on the permit modification

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issue, and these hearings should not have to be repeated by a potential purchaser of the Midland facilities.

Similarly, Consumer's application for an operator's license should not be dismissed at this time as it would send the wrong signal to potential investors. The dismissal would preclude a purchaser from merely assuming Consumers' position on a myriad of issues relating to whether an operator's license should be issued, e.g., data on safeguards against radiation hazards. Although the City and County of Midland recognize that any potential operator of the Midland nuclear facilities would be required to provide E

substantial data about itself to obtain an operator's 9

0 license, dismissal of Consumer's application would likely g dissuade potential purchasers from making an offer for the a

j facilities.

6 g It is likely, then, that if the Appeal Board follows i

through with its proposal to vacate the decision of the Licensing Board, any chance for the sale and completion of the plant will be lost. To foreclose this chance when the Midland facility is at least 85% complete, and after four billion dollars has been expended on the project, would be inimical to the public interest, would likely foreclose the use of the Midland facility as an option for Michigan's future energy needs, and constitute a colossal waste of money.

The situation which currently faces this Appeal Board is similar to that which it confronted in Georgia Power

Company (Alan W. Vogtle Nuclear Plant, Units 1 and 2, Docket Nos. 50-424 and 50-425), ALAB-276, Nuclear Regulatory Reporter (CCH), 9 30,001.01 (1975). There, the Licensing Board rendered its decision to authorize the issuance of construction permits to the Georgia Power Company. The Appeal Board embarked upon a sua sponte review of this decision. Prior to the time set for oral argument, however, Georgia Power Company informed the Appeal Board that it was cancelling construction of two of four units and suspending construction of two others "pending further consideration" of possible deferment or cancellation. Almost a year after I; the permits were issued, by Order of the Appeal Board dated 9

0 June 11, 1975, the parties were asked to address, inter g alia, whether the construction permits should be suspended 6

l5 and subject to reinstatement only upon the satisfaction of g certain conditions. Thereafter, the Georgia Power Company i

filed to amend construction permits to reflect a proposed change in ownership in the nuclear facility. At the time this application was filed, no sale had yet been consummated. In light of this new development, the Appeal Board chose not to suspend the construction permits but, rather, remanded the matter to the Licensing Board to conduct a supplemental hearing encompassing the issue of the changed ownership. Georgia Power Company (Alan W. Vogtle Nuclear Plant, Units 1 and 2, Docket Nos. 50-424 and 50-425), ALAB-285, Nuclear Regulatory Reporter (CCH), 1 30,001.02 (1975).

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i

Although no agreement in principle has yet been reached with respect to the purchase of the Midland nuclear facilities, as in Georgia Power Company, these proceedings should be maintained in the status quo as the City and County of Midland are actively engaged in seeking a purchaser for the facilities. The decision to strip the Licensing Board's construction permit modification order of its precedential value and to dismiss Consumer's application for an operator's license will virtually ensure that the Midland project will not be completed.

i

$ IV. GIVEN THE POINT TO WHICH THE MIDLAND PROJECT HAS 9 PROGRESSED, AND ITS IMPORTANCE FOR MICHIGAN, IF THERE I EXISTS ANY POSSIBILITY OF COMPLETING THE PROJECT, THE l

t STATUS QUO SHOULD BE MAINTAINED g As both Consumers and the NRC have noted in their

$ earlier memoranda to the Appeal Board, Consumers has not s

j abandoned the Midland nuclear facilities. Indeed, Consumers contends that it has in place a surveillance and maintenance program to ensure compliance with federal nuclear regulations so as to permit the resumption of construction should the facilities be sold or should Consumers be in a position to complete the project.

The Midland facilities are at least 85% complete.

Considering the four billion dollars already sunk into the project, it would be a foolish and tragic waste for the Appeal Board to issue an order which would constitute the

" knockout blow" for the project. There is no doubt that the plant is needed to meet Michigan's future energy needs. The i

Midland project has the support of the Michigan Public Service Commission, the United States Nuclear Regulatory Commission Staff, and the United States Department of Energy.

Any soils problem is correctible. The Licensing Board's Order modifying construction permits resolved the adequacy of acceptance criteria for the construction of safety-related soils and foundation systems. This fact underscores that the plant can be safely completed.

Given that the Midland project is essential to meet Michigan's future power needs, is at least 85% complete, and 5

can be safely completed, the Appeal Board should not issue 9

0 the Order which it contemplates, as such Order would be the

$ death knell for the project.

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i V. CONCLUSION 2

The City and County of Midland adopt the suggestion made at pages 5-6 of the NRC Staff's Response to Appeal Board Order of March 13, 1985, as to the appropriate manner for the Appeal Board to proceed. Specifically:

In view of the fact that CPC has indicated that it intends to keep its options open and that it plans to resolve the question of the future of the plant by 1987, the Staff suggests that this Board (1) hold its sua sponte review in abeyance and (2) direct CPC to file periodic reports with the Licensing Board and the Appeal Board regarding CPC's intent with respect to completion or termination of the Midland facility.

In the event that the decision is ultimately made to terminate this facility, it would then be appropriate for the Appeal Board to vacate the '

Licensing Board's decision and remand the operating license portion of the proceeding to the Licensing Board with instructions to take appropriate action.

If, however, the decision is made not to terminate the Midland facility, the Appeal Board can then conduct its sua sponte review. The Staff believes that this approach would (1) prevent further expenditure of public resources on appellate consideration of LBP-85-2, (2) provide a mechanism for the appropriate response when events clarify that the facility will either be completed or terminated and (3) prevent any unnecessary economic detriment to the Applicant.

E a For the reasons stated herein, the City and County of 9

Midland believe that the procedures set forth in the Appeal j Board's order of March 13, 1985, are inappropriate and 4

5 0

i concurs with the NRC staff's alternative recommendation, quoted above.

Respectfully submitted, MILLER, CANFIELD, PADDOCK AND STONE John D. Pirich, P.C. (P-23204 Thomas C. Phillips (P-24113)

Dated: // By  ;

Pirich, P.C.

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Dated: By a c L v> -

Thomas C. Phillips Business Address:

g One Michigan Avenue, Suite 900

Lansing, Michigan 48933 9 (517) 487-2070 l

lg 60636-6 TCPE:039 g 4/18/85 5

0 6

UNITED STATES OF AMERICA NUCLEAR REGULAT80ETTCDMMISSION USNRC BEFORE THE ATOMIC SAFETY AND LICENSING APPEAL BOARD 225 hML22 N1:18 In the Matter of GFFICE dF SECRGAi '

00CKETy_G & SEPVit.!

CONSUMERS POWER COMPANY TA606ket Nos. 50-329 OM & OL

) 50-330 OM & OL (Midland Plant, Units 1 and 2) )

)

PROOF OF SERVICE STATE OF MICHIGAN )

ss.

COUNTY OF INGHAM )

Melissa Jo Norman, being first duly sworn, deposes and 5

m says that on the 19th day of April, 1985, she served copies 9

U of the attached Motion For Leave To Participate As Amicus ig Curiae and Memorandum of the City and County of Midland, j State of Michigan With Respect to Appeal Board Orders of 5

y April 5, 1985 and March 13, 1985 on i

Mr. Frank J. Kelley, Esq. Mr. Steve Gadler Attorney General of the 2120 Carter Avenue State of Michigan St. Paul, MN 55108 Ms. Carole Steinberg, Esq.

Assistant Attorney General Atomic Safety & Licensing Environmental Protection Div. Appeal Board 720 Law Building U.S. Nuclear Regulatory Lansing, MI 48913 Commission Washington, DC 20555 Mr. Myron M. Cherry, Esq.

Cherry & Flynn Mr. William Clements (2) 3 First National Plaza Docketing & Services Suite 3700 U.S. Nuclear Regulatory Chicago, IL 60602 Commission Office of the Secretary Mr. Wendell H. Marshall Washington, DC 20555 4625 S. Saginaw Road Midland, MI 48640

Mr. Charles Bechhoefer, Esq. Ms. Mary Sinclair Atomic Safety & Licensing 5711 Summerset Street Board Panel Midland, MI 48640 U.S. Nuclear Regulatory Commission Dr. Jerry Harbour East-West Towers Atomic Safety & Licensing Room E-413 Board Panel

.4350 East-West Highway U.S. Nuclear Regulatory Bethesda, MD 20014 Commission East-West Towers Dr. Frederick P. Cowan Room E-454 Atomic Safety & Licensing 4350 East-West Highway Board Panel Bethesda, MD 20014 6152 N. Verde Trail Apt. B-125 Atomic Safety & Licensing Boca Raton, FL 33433 Board Panel U.S. Nuclear Regulatory Mr. Michael Miller, Esq. Commission Isham, Lincoln & Beale Washington, DC 20555 3 First National Plaza Suite 5200 Mr. William D. Paton, Esq.

g Chicago, IL 60602 Counsel for the NRC Staff G U.S. Nuclear Regulatory

{= Mr. Frederick C. Williams Commission Isham, Lincoln & Beale Washington, DC 20555

$ 1120 Connecticut Ave., N.W.

! Suite 325 Mr. P. Robert Brown, Jr.

s Washington, DC 20036 Clark, Klein & Beaumont

{ 1600 First Federal Building a Ms. Barbara Stamiris 1001 Woodward Avenue p 5795 North River Road Detroit, MI 48226 i Route 3 Freeland, MI 48623 Ms. Lynne Bernabei Government Accountability Mr. John Demeester, Esq. Project of the Institute Dow Chemical Building for Policy Studies Michigan Division 1901 Q Street, N.W.

Midland, MI 48640 Washington, DC 20009 Secretary Mr. James E. Brunner, Esq.

U.S. Nuclear Regulatory Consumers Power Company Commission 212 West Michigan Avenue Washington, DC 20S55 Jackson, MI 49201 ATTN: Chief, Docketing & Service Section by enclosing same in a sealed envelope addressed as above indicated, and depositing same in the United States mail with first-class postage fully prepaid thereon.

l Melissa Jo Norman Subscribed and sworn to before me a Notary Public this 19th day of April, 1985 1- .

.- ,7., t ' 's -,..<.

.a( g Joy E. Robinson, Notary Public Ingham County, Michigan

[3 My Commission Expires: 4/27/86 y 60f36-6

= TCI-E : 04 0 f: 04/19/85 N

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