ML20126D546
| ML20126D546 | |
| Person / Time | |
|---|---|
| Site: | Davis Besse, Perry  |
| Issue date: | 12/23/1992 |
| From: | Jerome Murphy CLEVELAND ELECTRIC ILLUMINATING CO., SQUIRE, SANDERS & DEMPSEY, TOLEDO EDISON CO. |
| To: | NRC COMMISSION (OCM) |
| References | |
| CON-#492-13484 91-644-01-A, 91-644-1-A, A, NUDOCS 9212280038 | |
| Download: ML20126D546 (18) | |
Text
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Am. ! L D usMc 92 DEC 23 ' P1 :38 UNITED STATEG OF AMERICA NUCLEAR REGULATORY COMMISSION w(tl o.
.swy n-
,,s my BEFORE THE NUCLEAR REGULATORY COMMISSION
)
In the Matter of
)
)
01110 EDISON COMPANY
)
Docket No. 50-440-A
)
50-346-A (Perry Nuclear Power Plant, Unit 1,
)
Facility Operating License
)
No. NPF-58)
)
(Suspension of
)
Ant 1&r ;t Conditions)
THE CLEVELAND ELECTRIC ILLUMINATING
')
COMPANY
)
ASLBP No. 9L-644-01-A Tile TOLEDO EDISON COMPANY
)
)
(Perry Nuclear Power Plant,
)
Unit 1, Facility Operating
)
License No. NPF-58)
)
(Davis-Besse Nuclear Power Station, )
Unit 1, Facility Operating License )
No. NPF-3)
)
)
ANSWER OF THE CLEVELAND ELECTRIC ILLUMINATING COMPANY-AND THE TOLEDO EDISON COMPANY TO THE LIMITED PETITION FOR REVIEW OF CITY OF CLEVELAND, OHIO, OF-THE NOVEMBER-18, 1992 DECISION OF THE ATOMIC SAFETY AND LICENSING BOARD Pursuant to.10 C.F.R.
S 2.786(b)(3), The-Cleveland Electric Illuminating Company ("CEI").and The. Toledo Edison Company ("TE") provide this Answer to the Limited Petition for Review of-City of Cleveland, Ohio.(" Cleveland"), of the November 18, 1992 Decision _of theTAtomic Safety & Licensing Board
(" Board").(" Cleveland Petition").
Specifically, CEI and TE 9212280038-921223 PDR ADOCK 05000346-q,-
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request that the: Nuclear Regulatory Commission ("NRC" or
" Commission") deny Cleveland's. Petition for Review as it fails'to allege "a substantial ques' tion" warranting review.1 I.
SUMMARY
OF THE BOARD'S DECISION REGARDING THE VARIOUS REPOSE DOCTRINES AND STATEMENT OF'WHERE ISSUES WERE PREVIOUSLY RAISED In denying the Motions for Summary Disposition of intervenors Cleveland, Alabama Electric Cooperative ("AEC") andl City of 3 rook Park
(" Brook Park") (as it adopted Cleveland's and AEC's arguments) with respect to the various repose doctrines, the Board correctly found that the Applicants did not -- nor_had any obligation to -- previously raise the bedrock legal issue presented in this action.2 Additionally, the Board properly 1/
See 10 C.F.R. S 2.786(4)(1992).
2/
See LBP-92-32, slip op. at 10-20-(Nov. 18,__1992) ("LBP 32") (denying the arguments pertaining to the repose doctrines set forth in Motion for Summary-Disposition of Intervenor Cleveland and Answer'in Opposition to Applicants' Motion for Summary Disposition (Mar.
9, 1992); Alabama Electric Cooperative's Combined CroS6-Motion for Summary Disposition and' Response to Applicants' Motion for Summary Disposition (Mar.
9, 1992); and Designation of Brook Park of Adopted Portions of Summary Disposition' Pleadings (Aug. 17, 1992)).
Cleveland originally. raised =these preclusion issues in its Answer of Cleveland in Opposition to OE's_ Application for suspension of Perry Operating License Antitrust Conditions-(Feb. 19, 1988) at 53-86..
CEI and_TE have consistently argued that these doctrines have no preclusive effect in this proceeding. 1See Application to Amend the
-Perry and Davis-Besse Operating Licenses to Suspend the Antitrust Conditions as They Apply to CEI and TE (May 2, 1988) at'19-39: Applicants' Reply _to Opposition Cross-Motions for Summary Disposition and Responses to Applicants' Motion for Summary _ Disposition (May 7, 1992)
(" Applicants' (Footnote 2 continued on next page).
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ruled that'the Applicsnts didfnot delay unreasonably in requesting relief from the_ license conditions.
The: Commission should-let stand the Board's ruling with respect to-these-repose doctrines.
A.
Law of the Case The doctrine of " law of the case" bars relitigation of the same issue in subsequent stages of the same proceeding.'3 The Board reaffirmed its Pre-hearing Conference rejection of Cleveland's claim that the present applications for amendment 4
represent a continuation of-the 1976-79 litigation that resulted in the imposition uof the antitrust license. conditions at issue.5 The Board refused to preclude litigation of_the bedrock legal issue on law of the case-grounds as that bedrock 11ssue.was "not (Footnote 2 continued from previous page)_
-Reply") at 90-110; Transcript of June 110, 1992 Argument before the Licensing Board at 305-08 (Mr. Murphy, counsel for CEI and TE).
3/
See LBP-92-32 at 12-13.
~ ~
-See Toledo-Edison Co. (Davis-Besse Nuclear. Power-Station, 4/
- Units _1, 2,
and 3),.LBP-77-1, 5~NRC 133 (1977)-,-aff'd as modified, ALAB 560,-10 NRC~265 (1979).
5/
LBP-92-32 at 13-15 (distinguishing Alabama Power Co._(Joseph, M.
Farley Nuclear-Power Plant, Units 1 and 2),-ALAB-182.;7;
'AEC 210, 215in.7-("Farley"),-remanded 1on'other grounds, CLI-L74-12, 7 AEC ?.03-(1974) and Houston Lighting and Power'Co.
(South Texas Proj ect, Units 1 and ; 2 ), _ LBP-7 6-41, 4 NRC 571,.
J575 (1976)
(" South Texas"), rev'd, ALAB-381,LS NRC 582,=590 1 91-(1977)
(" South Texas
'I"))..
4-t
n suf ficiently similar to those -n ; tters J itigated in-the - earlier proceeding in-light of changed circumstances..,6 B.
Pes Judicata and Collateral Estoppel The Board adopted the Supre,a Court's definitions of res judicata and collateral estoppel:
Under the doctrine of res judicata, a-judgment on the_ merits in a prior suit bars a second sait involving the same parties or their privies-based on the same cause of action.
Under the doctrine of collateral estoppel, on the_other hand, the second action is upon a different cause of action and the judgment in the prior suit precludes relitigation of issues actually litigated and necessary to the outcome of the first action.7 The Board rejected the same argument that Cleveland now presents to the Commission -- that the bedrock legal issue was resolved in the Davis-Desse licensing proceeding that resulted in the imposition'of the antitrust license conditions.8 6/
LBP '>2-32 at 15 n.37.
7/
See LDP-92-32 at 15-16 (quoting Parklane Hosiery co.1/. -Shore, 439 U.S.
322, 326 n.5 (1979) (citations omitted)).
8/
The bedrock legal issue aska the.following:
Is_the Commission without authority as a matter of law under Section 105 of the Atomic
-Energy Act to retain the antitrust license conditions contained in an operating license if it finds that the actual cost of
' electricity-from the licensed nuclear power plant is-higher than the cost of-electricity-from alternative _ sources, all_as appropriately-measured and compared?
See-LBP-92-32 at 6. _.
. _.... _ _ _.. _ _ _ _ ~ _ _ _
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- The Board corre:tly upheld the Applicantat and HRC-Staff's assertions that the " nexus" issue previously litigated' differs from the bedrock: legal issue now before the' Board.9 in i
. fact, the Paard acknowledged that Applicants presented evidence in the previous proceeding which recogntred not.only the possible erosion of economic benefits associated with-nuclear facilities, but also the remaining potential cost advantages of those nuclear plants.10 Thus, neither the Applicants nor any other parties to.
the earlier licensing proceeding squarely raised the " bedrock" issue.
More importantly, neither the Licensing Board nor-the r
-Appeal Board addressed the bedrock legal issue in those previous
- proceedings.
Given the evidence of the cost 1 advantages of nuclear power referre'd to in those prior licensing proceedings, t
it would have been incongruous to find that the Applicants previously were obligated to litigate;the'" bedrock" legal issue,
.and the Board did not do s0.11 Finally, the Applicants' assertion of changed circumstances. an exception-to both
- collateral. estoppel and res judicata,. precluded application of
.those doctrines.
9/
.See LDP-92-32 at 16:; Applicants' - Reply at'92-99 NRC~ Staff?s
-Answer to the Motion..for Summary Disposition-of.Intervenor, Cleveland (May'7, 1992) (" Staff Answer") at'5-7.
10/' See LBP-92-32 at 16-17.
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Id. at 17.
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.Laches Laches is "an equitable doctrine that bars the late filing of a claim if a partyfwould be prejudiced because of its actions during the interim-in reliance on the right_ challenged bp.
r the claimant."12 To establish the defense of laches, the evidence must show both that the delay was unreasonable and prejudicial to the party asserting it.13 Operation of the Davis-Besse reactor was authorized inl April 1977, with commercial operation achieved in July 1978.
Operation of the Perry facility was authorized in November 1986, with commercial operation achieved by November 1987.14 The OE
~
and CEI/TE Applications regarding-Perry "were clearly not unreasonably-delayed" as the Perry 7 facility did not begin r
operation until 1987.15 While the CEI/TE Application with respect to Davis-Besse might " conceivably" have been filed "somewhat earlier," the Board properly declined.to invoke an equitable doctrine to bar litigation of only'one portion of-the amendment requests.16 L-i L
M/
See-LBP-92-32 at 18.
13 /. LBP-92-32 at 18.; Applicants' Reply.at 108.
14/; LDP-92-32 at 19.
15/
Id. at 20.
_ 16/ - LBP-92-32 at 20.
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E II.
THE COMMISSION SHOULD-DENY REVIEW OF-THE.
BOARD'S RULING REGARDING THE REPOSE DOCTRINES The repose doctrines presented:in this action do not warrant-Commission review.17 Unlike the bedrock legal-issue, i
which clearly involves a " substantial and important question of t
law,"18 the repose issues present no such challenge.
At best,
-Cleveland alleges only that the " Board's flawed-dispositjon of the preclusion issues stems from the Board's erroneous view that it would be precluded _from reaching the ' bedrock' legal-issue if-it had ruled in Cleveland's favor on the preclusion issues."19
-3 17/
The NRC regulations provide the following guidance:
The petition for review may.be granted _in-the discretion of the Commission, giving due weight to the existence of a substantial question with respect to the following considerations:
(1)
A finding of material.factais
-clearly erroneous or.in conflict with a-finding as to the~same fact in a different proceeding:
_(ii)
A necessaryt legal conclusion is without governing precedent 1or is a departure
-from or contrary-to. established law:
(iii) A substantial and important.
question of law, policy or discretion has been raised;
-(iv) - The conduct of the proceeding _
involved a prejudicial - procedural-error; or-( v )--
Any other consideration which the-Commission 1may deem to be inithe public interest.
10~C.F.R.oS 2.786(4)'.
18/
-10'C.F.R.
S.l 2. 7'8 6 ( 4 ) ( 111 ).
19/
Cleveland--Petition at 9-10. '
- -,= -.
- - - ~
This-allegation not only is-wrong, but if true-,-shows_why--
Commission review is unwarranted.
The Board applied the.well-established law regarding these doctrines in_ finding _that they did not bar litigation of-the bedrock legal issue.:
- III, THE BOARD'S DECISION ON THE PRECLUSION 1 ISSUES IS PROPER AND SHOULD BE ALLOWED TO STAND A.
Law of the Case Cleveland's primary attack on the Board's decision-regarding the effects of " law of the csse" is that-the present-applications are part of the same ptoceeding which resulted in imposition of the license conditions.20 Cleveland's only foundation for this; argument is that the_present applications contain the same docket numbers as -- and are "part and parcel of" -- the previous licensing proceedings.21 Cleveland merely renews its reliance on the dicta in Farley and South Texas.and asserts that the Board's decision ~is " silent" with respect 1to_two.
cases which allegedly support Cleveland's position.22 Cleveland's attack fails---for several reasons..First, the-Farley_ Appeal Board expressly declined to decide whether there is a casis-for treating an operating license proceeding as 20/
See Cleveland Petition at 4-5.
21/- Id.
12/
See Cleveland Petition at-6-(citing Seacoast Anti-Pollution-l League v. NRC, 690.F.2d 1025, 1026 (D.C. Cir. 1982) and.
Power Reactor Dev. Co.
v.
Elec. Union, 367 U.S.
396, 405, 407 (1961)).
~_ - -
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involving the same cause of-action as a construction permit proceeding.23' Secondly, the South Texas dicta upon which a
Cleveland relies was reversed on appeal.24 Similar to its reliance on Parley and South Texas, Cleveland's reliance on Seacoast and Power Reactor is misplaced.
In dicta, the seacoast and Power Reactor courts-only generally describe the " step-by-step" nature of the NRC licensing scheme.
Neither Seacoast nor Power Reactor stated that-the construction permit and operating licensing proceedings involve only one proceeding.
More importantly, like Parley and South Texas, neither Seacoast nor Power Reactor addressed the issue of whether a license amendment' proceeding is separate-from the construction-permit and operating license proceedings.
Critically, Cleveland's interpretation of.the law of the case doctrine would preclude all license amendment requests as t
attempts to " avoid the adverse determination" of the original licensing' proceedings.25 Applicants here seek to employ the tHU:-
J regulatory scheme that specifically grants licensees the rightito
~
seek amendments, including the requested relief.
23/. Applicants' Reply at.106-07 n.249 (citing Farley, 7.AEC at-215 n.7),
24/~ SeeLLBP-92-32'at 14-15 (citing South Texas'II, 5-NRC-at 590-91).
25/
See Cleveland Petition-at 5; Applicants' Reply at'91.
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_ Collateral Estoppel and-Res Judicata Cleveland challenges the Board's ruling regarding collateral estoppel and res judicata by_ alleging that Applicants raised the bedrock legal issue as part of their " nexus" argument in the construction permit stage of the antitrust review license proceedings.26 Cleveland's argument is wrong in two respects.
First, as the Board recognized, the Applicants' previous nexus argument differs from the bedrock legal issue in this proceeding.
Secondly, changed circumstances occurring subsequent to the licensing proceedings require a review of the NRC's_ authority to impose the license conditions in the absence.of a cost advantage.27.
Cleveland clearly lacks an understanding of the previously litigated " nexus" argument.
In that argument, Applicants first argued that any anticompetitive impact of the proposed CAPCO nuclear facilities was already offset by the availability of wholesale-power purchases from the proposed nuclear facilities so that the " licensed activities" would not
" create or maintain a situation inconsistent with the antitrust laws."
Next, Applicants maintained that any relief that might be proposed had to be confined to participation-in and operating arrangements-of the proposed nuclear' facilities.28 In contrast, 26/
See Cleveland-' Petition at 6.
r--
27/
Applicants' Reply at 92-104.
28/ _See Applicants' Reply at 93-94.
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the bedrock-legal issue asks whether the NRC-is. authorized under 5 105c_of_the Act-to' retain antitrust-license conditions if it s
finds that the actual-cost of electricity from the licensed facility is higher than the cost of electricity from alternative-sources.
Dr. Pace's testimony fails to_ support Cleveland's position on this issue.29 The purpose of-Dr.-Pace's testimony-regarding the relative cost of nuclear power was-to emphasize-that all advantageous economies resulting from nuclear generating capacity would be shared with the Applicants' wholesale customers.30 As the Board noted, in the earlier proceeding the -
Applicants' testimony appears to have recognized not only the possible erosion of economic benefits,- but also that there.-were still cost advantages-to nuclear plants.31 ThusLthe bedrock issue of whether. license-conditions could txa imposed. in the
-absence of a showing of. lower comparative costs _ logically would not'have.been, and indeed was not, raised by the-Applicants or-any other parties _to-that proceeding.
More importantly,-that
-issue was not addressed by the Licensing or Appeal Boards.32-
~
E 29/.See.Cievelana Petition at 6-7.
30/' See-Appl ~icants Reply at 95-n.223.
31/. LDP-92-32 at-16-17.-
32/
Id.
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Cleveland erroneously claims that the Board "itself discloses that the Licensing and Appeal Boards did confront and reject the very.same contentions which are inherent-in the bedrock legal issue decided by the Board."33 In' fact, in that referenced passage the Board merely indicatus that there was evidence presented in the Davis-Besse licensing proceeding that CEI's system cost for generating electricity, as reflected in the rates it charged, were relatively high.
The Board did not address the incremental impact on CEI's system costs resulting from the addition of nuclear generating capacity.
Additionally, regardless of prior. proceedings, the existence of changed circumstances requires a review of the applications at this time.34 The dramatic increase in the cost of generating nuclear power relative to the cost of alternative power sources constitutes a significantly changed circumstance.
These increases result primarily from rises in capital investment costa attributable to federal regulatory _ initiatives, legislative r
initiatives, and high' inflation, as well as comparable increases in nonfuel operating costs.
33/
See Cleveland Petition at 7 (referencing LBP-92-32 at 33-38).
34/
See Applicants' Reply at 99-104.
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-Laches Cleveland demonstrates its misunderstanding of:the laches' doctrine'in~merely quantifying the time elapsed _between the date that the Perry and Davis-Besse plants began operating-and the dates of the applicationLfilings.35 Cleveland ignores the fact that the actual cost increase resulting from the various
__ changed circumstances were felt first onlyl years after-those-referenced changes. occurred.36 Had Applicants sought-the suspension of these license conditions significantly earlier,_
Cleve and and the other intervenors certainly_would have alleged that the requests were premature due to the_ lack of adequate operating cost history.
Applicants have analyzed conservatively _
the cost data over a time period sufficient to support the conclusion that costs related to nuclear facil'ities are steadily and consistently increasing and, in fact, exceed the relative:
i-costs of alternative sources.
Additionally, Cleveland fails to establish _any real prejudice suffered as a result ofc the alleged delay.
Cleveland's actions taken in reliance on theilicense conditions were done so with full knowledge that these conditions could be terminated or
-suspended for any.one of a variety of reasons.37 3S/_ See_ Cleveland Petition at 7-9.
36/
See Applicants'~ Reply _at 101-02;-108-09.
27/L See Applicants' Peply at 110 (citing ALAB-560, 10 NRC at 294)4
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i IV.
COrlCLUSION Cleveland fails to allege a " substantial question" warranting Commission review under 10 C.F.R. 5 2.786(4).
Accordingly, the Commission should deny Cleveland's Petition and let stand the Board's decision respecting these repose issues.
Respectfully submitted, khuo f df&tyjn Mmes P. Murphf' y Colleen A.
Conry Squire, Sanders & Dempsey 1201 Pennsylvania Avenue, N.W.
P.O.
Box 407 Washington, D.C.
20044-0407 (202) 626-6793 Date:
December 23, 1992 Counsel for The Cleveland Electric Illuminating Company and The Toledo Edison Company
B
- j i !!. D t5%
UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION
'92 - DE.C 23 P 1 :38 BEFORE THE NUCLEAR REGULATORY COMMISSION:
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)
In the Matter of
)
)
O!!IO EDISON COMPANY
)
Docket No. 50-440-A
)
50-346-A (Perry Nuclear Power Plant, Unit 1,
)
Facility Operating License
)
No. NPF-bd)
)
(Suspension of
)
Antitrust Conditions)
THE CLEVELAND ELECTRIC ILLUMINATING
)
COMPANY
)
ASLDP No. 91-644-01-A THE TOLEDO EDISON COMPANY
)
)
(Perry Nuclear Power Plant,
)
Unit 1, Facility Operating
)
License No. NPF-58)
)
(Davis-Besse Nuclear Power Station, )
Unit 1, Facility Operating License )
No. NPP-3)
)
)
' CERTIFICATE OF SERVICE I HEREBY CERTIFY that a copy of the foregoing Answer'of The Cleveland Electric Illuminating Company and The Toledo Edison
. Company to the Limited Petition for Review of City of Cleveland.
Ohio, of the November 18, 1992 Decision of the Atomic Saf'ety and Licensing Board is served this 23rd day of December, 1992 to each of the following persons by first class mail, postage. prepaid, unless otherwise-indicated:
Samuel J. Chilk
. Secretary of the commission U.S. Nuclear Regulatory Commission 11555 Rockville Pike Rockville, Maryland 20052 (BY HAND) l l
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CharlesLBechhoefer Atomic: Safety'and Licensing Board Panel-LU.S. Nuclear Regulatory Commission 4350 East West Highway, 4th' Floor Bethesda, Maryland 20814 (BY HAND)
G. Paul Bollwerk,.III Atomic Safety and Licensing Board Panel U.S. Nuclear Regulatory Commission 4350 East West Highway, 4th Floor Bethesda, Maryland 20814 (BY HAND)
Marshall E.
Miller, Chairman Atomic Safety and Licensing Board Panel U.S._ Nuclear Regulatory Commission 1920 South Creek Boulevard Spruce Creek ~ Fly-In-Daytona Beach,-Plorida 32124 (BY FEDERAL EXPRESS)
Joseph Rutberg, Esq.
Sherwin E. Turk, Esq.
Steven:R. Hom, Esq.
Office-of the General Counsel U.S. Nuclear Regulatory Commission 11555 Rockville Pike Rockville, Maryland 20852 (BY HAND)
Atomic. Safety and Licensing Board Panel U.S. Nuclear Regulatory Commission 11555 Rockville Pike:
Rockville, Maryland 20852-(BY IIAND)
Office of Commission Appellate Adjudication U.S. Nuclear-Regulatory Commission 11555 Rockville Pike Rockville, Maryland 20852 (BY HAND).
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Mark C.'Schechter,fEsq.
Janet-Urban, Esq.
Transportation, Energy _and
' Agriculture Secticn Antitrust Division Department of Justice
-Judic.iary Center Building 555 Fourth Street, N.W, _
l Washington, D.C.
20001 June W. Weiner, Esq.,
Chief Assistant Director of-Law William M. Ondrey Gruber, Esq.,
Assistant Director of Law William T..
Zigli,.Eng.
Assistant Director of Law City'llall, Room 106 601 Lakeside Avenue Cleveland, Ohio 44114 l
f Reuben Goldberg, Esq.
- Channing D.
Strother, Jr., Esq.
Goldberg, Fieldman & Letham, P.C.
1100 Fifteenth Street, N W.-
m Washington,-D.C, 20005
' D. Biard MacGu.ineas, Eng.
- Volpe,.Boskey.and Lyons 918 Sixteenth Street, N.W.
Washington, D.C.
20006 s
Philip N.'Overholt-Office of Nuclear Plant Performance Office.of; Nuclear Energy U.S. Department of' Energy, NE."
199012 Germantown (Road, Room-E-418-Germantown, Maryland: 20585:
Kenneth L. Hegemann, P.E.
President:
AmericanDMunicipal Power Ohio, Inc.
601 Dempsey Road
.P.O.
Box--549 Westerville, Ohio 43081 LDavid R.-Straus, E'3q.-
- Spiegel.ra McDiarmid-
-1350 New York Avenue. N.W.
Suitc11100 Washington,- D(C.
20005-4798 W
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- i-Anthony J. Alexander, Esq.
Vice President and General Counsel Ohio Edison Company-75 South Main Street-Akron, Ohio 44308 Gregg D. Ottinger, Esq.
John P. Coyle, Esq.
Duncan & Allen Suite 300 1575 Eye Street, N.W.
Washington, D.C.
20005-1175 David A. Lambroc, Esq.
Law Director City. o f Brook Park 6151 Engle Road Brook Park, Ohio 44142 Gerald Charnoff, Esq.
Shaw,. Pittman, Potts and Trowbridge 2300 N Street.
N.W.
Washington, D.C.
20037
(^$Ybl&v h h w R e Colleen A. Conry Dcq(~/
Squire, Sanders &
sey 1201 Pennsylvania Avenue, N;W.
P.O.
Box 407 washington, D.C 20044-(202) 626-6600
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