ML20127P099
| ML20127P099 | |
| Person / Time | |
|---|---|
| Site: | Catawba  |
| Issue date: | 06/28/1985 |
| From: | NRC ATOMIC SAFETY & LICENSING APPEAL PANEL (ASLAP) |
| To: | |
| References | |
| CON-#385-681 OL, NUDOCS 8507020307 | |
| Download: ML20127P099 (72) | |
Text
ORIGINAL' cy UNITED STATES OF AMERICA
- ! NUCLEAR REGULATORY COMMISSION v
In the matter of:
DUKE POWER COMPANY, et al.
(Catawba Nuclear Station, Units 1 and 2)
Docket No. 50-413 OL 50-414 OL
( ) SUPPLEMENTAL ORAL ARGUMENT
\J Location: Bothenda, Maryland Dato Priday, June 28, 1985 Pages: 99 - 169 0$07020307 050620 POR ADUCK OD000413 I PDR ANN RILEY 4. ASSOCIATES
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99
,s 1 UNITED STATES OF AMERICA t ) -
'/ 2 NUCLEAR REGULATORY COMMISSION 3 Fefore the Atomic Safety & Licensing 4 Appeal Board 5 -.-------------x 6 In the matter of: :
7 DUKE POWER COMPANY, et al. : Docket No. 50-413 OL
- 50-414 OL 8 (Catawba Nuclear Station 9 Units 1 and 2) a 10 . . . . _ _ _ _ _ _ _ _ _ _x 11 4350 East West liighway 12 5th Floor !! caring Room
('m. ,
Bothesda, Maryland v
) 13 14 Friday, June 28, 1985 15 16 SUPPLEMENTv\L ORAL ARGUMENT The abovo-entitled matter came on for hearing 17 l 18 before the Atomic Safety & Licensing Appeal Board, pursuant 19 to notico, commencing at 9:30 a.m.
20 PRESENT FOR Tile APPEAL BOARD:
21 Judsje Alan S. Rosenthal 22 Judge lloward A. Wilbert 23 Judge Thomas S. Mooro 24
(
25
100 1 APPEARANCES:
2 on behalf of the Applicant 3 J. MICHAEL MC GARRY, ESQ.
4 MARK S. CALVERT, ESQ.
5 ANNE W. COTTINGHAM, ESQ.
6 Bishop, Liberman, Cook, Purcell & Reynolds 7 1200 17th Street, N.W.
8 Washington, D.C. 29936 9 -and-19 ALBERT V. CARR, JR., ESQ.
11 Duke Power Company 12 422 South Church Street 13 Charlotte, North Carolina 28242 14 15 On behalf of the NRC Staffs 16 GEORGE JOHNSON, 280.
17 Office of the Executive Legal Director 18 U.S. Nuclear Regulatory Commission
, 19 Washington, D.C. 29555 20 21
! 22 l
i 23 24 25 L _
101 1 _
C0NTENTS 2
3 PAGE:
4 Oral by Mr. McGarry, s 9 5 on behalf of Duke Power Company 104 6 Oral by Mr. Johnson, 7 on behalf of the NRC Staff 133 8 Rebuttal by Mr. McGarry, ,
9 on behalf of Duke Power Company 157 19 11 12 0 1, 14 15 16 17 ,
18 19 29 21 22 23 24 25
i l \
102 1 ,. PROCEEDINGS 2 JUDGE ROSENTHALt Please be seated.
l 3 Wo are hearing oral argument this morning on a 4 question which this Board raised sua sponte in connection with 5 the pending appeals in this operating license proceeding l 6 involving Catawba Nuclear Station. )
7 That question is whether the Nuclear Regulatory l
8 Commission was required to issue a public notice of 9 opportunity for hearing with respect to the planned use of the le Catawba facility for the receipt and storage of spent fuel 11 generated at the applicant, Duke Power Company's Oconee and 12 McGuire facilities.
13 The Statf and the Intervenor, Palmetto Alliance, l
14 will answer this question in the affirmative. !
15 For their part, the Applicants maintain that the l
16 question requires a negative answer. !
17 In this connection, there is a particularly sharp !
18 difterence of opinion between the Applicants and the Staff !
l 19 respecting whether the storage of spent fuel generated at 29 another facility constitutes a use of a commercial utilization j 21 facility within the meaning of Sections 191 and 193-A of the 22 Atomic Energy Act of 1954, as amended. I 23 As noted in our June 13 order calling for this 24 supplemental argument, the Board is particularly interested in 25 exploring this morning that difference of opinion.
1 !
l l
I
{ 103 1 ,. As further indicated in the June 13 order, each 2 party to the proceeding has been allocated 30 minutes for the l 3 presentation of argument.
4 In this connection, although Mr. Guild, counsel for 5 the Intervenors, had originally intended to participate in the 6 argument, he advised the secretary to this Board by telephone 7 a day or two ago that he had decided to leave his fate on the 8 question here in the hands of the Staff, whose position he 9 endorses.
19 I might say in that regard that Mr. Guild's decision 11 not to participate in the argument was made with the full 12 agreement of the Board. The Board felt that in the 13 circumstances the issue that he is particularly interested in would be sufficiently ventilated by counsel for the Applicant
- 14 15 and the Staff.
16 I will now call upon those counsel to identify 17 themselves forma 11tr for the record, and I will start with 18 Mr. McGarry.
19 MR. MC GARRY: Good morning, your lionor. My name 29 is Michael McCarty. I will be representing Duke Power 21 Company. Mr. Carr, also with Duke Power Company, is with me 22 at counsel table, as well as Ms. Cottingham and Mr. Calvert.
23 JUDOM ROSENTilA!,t Thank you, Mr. McGarry.
24 Mr. Johnson?
25 MR. JOHNSON: Good morning, your lionor. I am George i
104 Johnson, and I will be representing the NRC Staff this (v) 1 2 morning.
3 JUDGE ROSENTHAL: Thank you, Mr. Johnson.
4 All right, Mr. McGarry, wo will hear from you.
5 ORAL ARGUMENT BY MR. MC GARRY, ON BEHALF OF DUKE 6 POWER COMPANY.
7 MR. MC GARRY: Good morning, your Honors.
8 As wo see it, there is an extremely narrow question 9 before the Board today and before us today, and that is, was 10 the NRC required to issuo a notice.
11 As wo understand it, this Board does not contemplate 12 entertaining any discussinn about tho adoquacy of such notico.
(-~)
V That was what our argument notice 13 JUDGE ROSENTHAL:
14 indicated. I can't exclude the possibility that one of my 15 colleagues might croop over the lino.
16 MR. MC GARRY: I guess I am just trying to protect 17 mynolf and say that wo have focunod our preparation on the 10 question of whethor or not notico is required. Obviously wo 19 will be able to address adoquacy questions concerning 20 incorporation by reference, actual notico, and questions 21 concerning jurisdiction.
22 But as wo nuo it, the main thrust is indood whether 23 or not a notico waJ required. To answer that question, wo l
24 would begin by noting that tho storago of apont fuel is a Part 25 70 activity, as well as wo will discuss today a Part 70 l
105
() 1 2
activity does not require a mandatory notice.
Rather, notice under Part 70 is discretionary.
3 JUDGE ROSENTHAL Is there any dispute about that?
4 I thought the question here is whether this constitutes a use 5 of this production and utilization facility which requires 6 notice under Part 59.
7 I don't think anybody is arguing that if all we were 8 dealing with here was Part 70, then notico would not be 9 required. Am I wrong about that?
10 MR. MC GARRY: I don't think there is any 11 disagroomont betwoon the Staff and the Licenson in that 12 regard.
~
13 JUDGE ROSENTHAL: Let's get on to the use question.
14 MR. MC GARRY: Certainly.
13 Wo disagree with the Staff, as the Board recognizos, 16 with rospect to the uso question. As wo soo it, the Staff's 17 argumont -- the Staff suoms to be saying that there are really 18 two stagos to the storage of spent fuoi at catawba, the 19 storage of spent tuol generated at Oconoo and McGuire.
20 The first phoso is the possession of storago, and 21 tho second phano is the uso of the Catawba facility to storo 22 that spent fuel.
23 1 don't think the Staff disagroom with respect to
\s -) 24 phaso one, which is the ponsassion and storage, that indeed a 25 Part 70 application and licenso is appropriato.
4
106
/) 1 _ Their argument seems to hinge on the second phase, V
2 which is the use of the Catawba facility. We disagreed with 3 this phased approach for several reasons:
4 First, we would focus on Price Anderson. In all 5 candor, I must admit to the Board that Price Anderson argument 6 was recommended to us prior to the Board's drawing it to our 7 attention by Mr. Knotts of the same office that I am employed 8 by. Mr. Knotts, as you know, is an expert on Price Anderson.
1 9 However, neither Mr. Carr nor I could appreciate the i
l 19 significance of what he was saying, but I guess to Mr. Carr's i
11 credit and my credit, we only have to be hit over the head -
12 twice before we finally see the light. And we appreciate the
()
13 Board giving us an opportunity to address it. Because we 14 think that the Price Anderson argument is clearly dispositiva ;
l 15 of the issue, and that the Staff's argument concerning use is 16 incorrect.
17 JUDGE MOORE: You're going to have to hit me over l 18 the head three times, because ! thought the Commission's 19 notice in the Federal Register of Monday, January 8, 1979 for 29 Duke Power Company's request, then ponding request to store l 21 Oconee-McGuire fuel -- ! guess it was Oconee fuel at McGuire l
l 22 at that point -- indicates that under Price Anderson the l
l 23 Commission does not believe that fuel generated at one
() 24 facility being stored in another is a use that must be --
25 MR. MC GARRY: No, no, no. I think what the ,
l I i
107 l Commission is saying is in this precise Federal Register
(}
2 Notice you're making reference to, is that the spent fuel 3 generated at another facility is not a use of facility where 4 it's going to be stored.
i 5 What underlies this Federal Register notice is the 6 indemnity agreement, and under Part 140, there is an indemnity 7 agreement that covers Catawba, that covers Oconee, that covers 8 any utilization facility.
9 JUDGE MOORE: If your argument is correct, why 10 wasn't Price Anderson covered automatically, as it is when the 11 fuel is stored on site where it's generated?
rs 12 MR. MC GARRY: If our argument is correct, why f
V 13 wasn't Price Anderson covered automatically?
14 JUDGE MOORE: As I understand what you just said, 15 what the Commission's notice indicates is that storing fuel
, 16 away from the site at which it is generated is not a use of 17- the receiving facility.
18 MR. MC GARRY: That is correct. That's what I'm 19 saying.
20 JUDGE MOORE: Then why is Price Anderson coverage 21 not automatic in that situation?
22 MR. MC GARRY: It isn't automatic because the 23 definition of radioactive materials would not include the 24 spent fuel generated from Oconee or McGuire. Therefore, the 25 indemnity agreement had to be amended to include a new
108
/~%) definition of radioactive material. l
( 1 '
%-)
2 I think if we would look at that proposed rule, the 3 answer is clear in the second column, the last paragraph. It 4 says, " Possession of spent fuel away from the facility where 5 it is generated, i.e., at a location where it is not used in 6 connection with operation of facility."
7 It's clear the spent fuel is not used in connection 8 with the Catawba facility. It is not a use of the Catawba 9 facility. I don't know how clearer the Commissioner could 10 be. I think that is the answer to the question. I could sit 11 down right now.
,-~ 12 JUDGE ROSENTHAL: I wouldn't do that quite yet, V
13 Mr. McGarry.
\
14 MR. MC GARRY: I sensed that was the case.
15 [ Laughter.]
16 MR. MC GARRY: Did you have a question, Judge 17 Rosenthal?
18 JUDGE ROSENTHAL: I find some difficulty in 19 understanding why in common, ordinary parlance this doesn't 20 constitute a use of that facility? It seems to me what we 21 have got now is the Catawba facility being used, or the 22 utility would have it being used for two separate and 23 distinct, independent purposes:
l 24 One for the generation of electricity, and l
25 everything that goes with that is integral to it, if you will.
109 n)
( 1 _ And secondly, as a temporary or permanent, as the 2 case may be, offsite repository for spent fuel generated at 3 other facilities.
4 Now that is clearly a use, and I would like you to 5 tell me where specifically either the Commission or the 6 Congress has said that a use of a production and utilization 7 facility for some other purpose than the generation of 8 electricity and whatever goes with that is not a use.
9 MR. MC GARRY: That's a difficul.t question. We have 10 looked at that legislative history and we have looked at 11 statements by the Appeal Board and by the Commission, and I 12 think we are in a new area right now.
13 JUDGE ROSENTHAL: I don't see why the term "use" 14 should not be given its ordinary garden-variety meaning, 15 unless there is some clear indication that a different or more 16 limited meaning was intended.
17 MR. MC GARRY: I am going to embark upon an argument 18 now and I hope you follow this. It gets a little sticky as we 19 go through it.
20 But I don't disagree with you with respect to your 21 first definition of use, and that is the utilization to 22 generate electricity.
23 In fact, we advance that argument in our papers.
p.
(. l 24 JUDGE ROSENTHAL: You say it's restricted.
25 MR. MC GARRY: That's right.
4
110
- Now the second definition of use, which would be
[q )\ l 2 using Catawba to store fuel. Well, there's no question but 3 that we are going to use -- we have potential plans to use 4 Catawba to store spent fuel. We admit that. But we don't 5 think that activity is a use which triggers the 101 and 103 6 requirements which the Staff suggests, and if we cut through 7 the Staff's argument, what they're saying is you can't rely 8 upon Part 70. There's an automatic notice that is required 9 pursuant to the definition of use as used in 101 and 103. And 10 we are saying that is not the case.
11 JUDGE ROSENTHAL: You're saying in all of these 12 instances in the past in which the proposal was on the table 13 to authorize the transfer of spent fuel from one facility to 14 another, the notice that was given was purely discretionary; 15 is that right? In every case you'll agree there's always been 16 notice? There's never been a prior instance in which notice 17 was not afforded?
18 MR. MC GARRY: That's correct. As we have said at 19 least on two occasions we view this discussion as somewhat 20 academic because we chose to make this Part 70 activity part 21 of our license application, and the license application must 22 be noticed pursuant to the regulations.
23 JUDGE ROSENTHAL: What follows from that, assuming
[ that -- which I want you to assume for this discussion -- that
\/ 24 25 we conclude that the notice was inadequate to convey the
111 1 notion ' that what was on the table was not merely the 2 generation of electricity and everything incident to that, but 3 also the receipt and storage of the spent fuel? For present 4 purposes I want you to assume that the notice was not adequate 5 for that purpose. Incorporation by reference just did not 6 carry the day.
7 Now what follows on that assumption from the 8 statement you have just made?
9 MR. MC GARRY: Then what we're faced with is we're
~
le looking at the Part 70 and we are saying whether or not notice 11 is mandatory and Staff is saying -- Staff is forcing it back 12 into Part 50, because they acknowledge the Part 70 activity b4
\- 13 and they acknowledge what we did in Part 70 and what they did I
14 in Part 70 was correct. Then they throw in'an extra Part 50 15 and say that Part 50 kicks you into a mandatory notice, and
! 16 the premise of that position is the use question. That's 17 where we have our disagreement.
18 JUDGE ROSENTHAL: Let me ask you this: If you are 19 right about that, does it follow that we have to now call upon 20 the Staff to determine whether they would have issued the 21 notice as a matter of discretion? Staff thought apparently 22 they were issuing this notice as a matter of obligation.
2 23 You are saying no, you were not obligated to do it,
(%,
4
\ ,) 24 but of course the Staff has the discretion to do it.
25 Now if the Staff has the discretion to do it, it has
112 l not as yet exercised that discretion, has it?
['%, )\
2 Now why wouldn't we have to pull the authorization 3 here and say to the Staff at least until the Staff tells us 4 whether it wishes to exercise its discretion?
5 It's interesting here that in every one of these 6 cases there has been notice, and in addition to that, if I may 7 just add one thing, I'm a little troubled, frankly, about this 8 argument that there doesn't have to be notice when it is 9 viewed in the context of our decision in Oconee-McGuire which 10 as you will recall, Mr. McGarry, one of the questions there 11 was whether one had to look at this whole alleged cascade plan 12 at that time. You will recall we said no, all that we needed 7-ss b 13 to look at at that point was the transfer of spent fuel from 14 Oconee to McGuire. Wasn't there implicit in that the notion 15 that when as, and, if another step in this alleged cascade 16 plan came on the table, that there would be notice and full 17 opportunity to litigate the environmental effects, if any, of 18 that movement?
19 MR. McGARRY: With all due respect, you have asked 20 me about seven questions.
21 JUDGE ROSENTHAL: I probably have. I will give you 22 sufficient time to respond.
23 MR. McGARRY: I appreciate tnat.
24 I understand the Appeal has concerns here and that 25 is why we are back. I understand basically we are going to be
113
() 1 answering questions and fielding questions. I'm going to do 2 the best I can.
3 There are several observations, Judge Rosenthal, to 4 what you just said. First of all, one thing. It is not our 5 notice; it was the Staff's notice. We didn't write the 6 notice. We filed an application. So when you have a concern 7 with Oconee/McGuire, that concern is is the Applicant trying 8 to hide behind this notice because in Oconee/McGuire they said 9 the next phase, if there is a next phase, the public will be 10 able to participate.
11 That's precisely what we did in our application that 12 we filed publicly with the Staff. We said we have potential 73 b 13 plans. Now, what was done with that notice, don't look to us 14 and say you are trying to hide behind something.
15 JUDGE ROSENTHAL: I didn't say you are trying to 16 hide behind it; you are just stuck, however, with that notice 17 if notice was required and the notice is deficient.
18 MR. McGARRY: That may be, but I just want that 19 clear in terms of perspective here.
20 Now I'm going to raise another issue, with all due 21 respect. I have looked at the case law published by the 22 Appeal Board, and at least in one instance -- no, in two 23 instances the Appeal Board could have reached this issue and 1
('~)/
\_- 24 they chose not to. With all due respect, the Judge I clerked 25 for told me if you don't have to say something, don't say it.
c 114 1 _ What I am suggesting is this is not an issue that 2 you have to reach.
3 JUDGE ROSENTHAL: Certainly it is. It's a 4 jurisdictional question, isn't it? If we decide that notice 5 was required, if we decide that this notice is deficient, then 6 we have got to face, do we not, however you might want us to 7 answer it, the jurisdictional question as to whether the 8 Licensing Board could entertain the receipt and storage 9 proposal and authorize it in circumstances where it was not 10 within the ambit of the notice.
11 Now, I understand your argument on these other 12 points, but where I come from, jurisdictional issues are 13 always on the table whether or not they have been raised.
14 Now, in some other cases we didn't address the jurisdictional 15 question that was there. That may be so. But as you know, 16 there is no estoppel.
17 MR. McGARRY: We are always guided by Appeal Board 18 decisions, Your Honor. We are well aware of how you approach 19 it. But let me make reference to the Limerick case, which 20 none of you remembers, of that Board. What is interesting 21 there is they said, as in AFRI -- and this is footnote 10 of 22 ALAB-765, 19 NRC 645 at 652. They said it is not clear 23 whether any other statutory or regulatory provision requires
) 24 notice of material license action. As in AFRI, however, it is 25 not necessary that we resolve the issue because FOE had actual i
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() 1 2
knowledge of the Part 70 application and they went on to 9xplain it.
3 They didn't concern themselves with whether or not 4 any other member of the public -- they didn't concern 5 themselves --
6 JUDGE ROSENTHAL: They are dealing with the 7 jurisdictional question; they are not dealing with the 8 question as to whether a particular individual had notice.
- . 9 MR. McGARRY
- My point is you don't have to worry 10 about jurisdiction. You worry about' jurisdiction when you 11 question the adequacy of the notice. I am suggesting based on 12 this footnote this Licensing Board didn't have any trouble
! 13 with the adequacy of the notice and you shouldn't either, for
< 14 the following reason. Here they said you don't have to worry i
15 about it because FOE, which was a party, was on notice.
16 There is no question that the parties to this case 17 were on notice, and Intervenor doesn't argue otherwise. sour 18 concern, at least Judge Moore's concern at one point in time 19 was how about other people? What I am suggesting is this 20 Appeal Board could have raised the question with respect to 21 other people and they didn't raise it.
12 JUDGE ROSENTHAL: My concern is not with this person
, 23 or any other specific individual. My concern, again, is
\s 24 jurisdictional in nature. There are Appeal Board decisions
! 25 which hold that a Licensing Board's jurisdiction is bound by l
i- I
116 l' l 1 the content of a notice of hearing or, as in this instance, V
2 notice of opportunity.
3 MR. McGARRY: Judge Salzman says it's bound by the 4 licensing application, and the licensing application, the 5 operating license application contains this. We cite those 6 cases. I know there are at least two cases. I just read 7 Judge Salzman's decision, and they use the term " operating 8 license." I read one of your decisions, and you said exactly 9 what you just said today. That is, the Federal Register 10 notice.
11 But we point to those cases and I direct your 12 attention to them because that's our point, that the notice 13 itself is satisfactory, and that is why I'm saying if the 14 notice is satisfactory, you don't have to reach the 15 jurisdictional.
16 JUDGE ROSENTHAL: I understand if the notice is 17 satisfactory, obviously,the jurisdictional question does not 18 have to be reached, but we are assuming -- at least I am 19 assuming for the purpose of this discussion that the notice is 20 not satisfactory.
21 MR. McGARRY: All I am trying to do is dissuade you 22 from that. I appreciate --
23 JUDGE ROSENTHAL: I realize I asked you perhaps too 24 many questions in one bite, but my first one, to which I would 25 like a response, is: Assume you are right, that notice here
117 1 was discretionary and not obligatory. Why doesn't the Staff 2 now have to determine whether as a matter of discretion notice 3 should be afforded in this instance? Because you agree that 4 Staff can reach that decision, that you don't have the right 5 to insist upon a total absence of notice.
6 MR. McGARRY: I'm not sure if it's the Staff or the 7 Commission, but someone does have that right or duty.
8 JUDGE ROSENTHAL: Call it whatever you want to, but 9 Staff's position is that they were not exercising discretion 10 here; they issued this notice because they were required to.
11 MR. McGARRY: I don't think they come out and say 12 that, but we will agree to that.
13 JUDGE ROSENTHAL: They said notice was required 14 under Part 50. They make it perfectly clear. That is what we 15 are here this morning exploring, a difference of opinion 16 between yourself and the Staff on this.
17 Staff takes the position, as I understand it, that 18 the notice in this instance is required.
19 MR. McGARRY: We are not disagreeing. That's what I 20 tried to say in the beginning. And I don't think -- somehow 21 we missed one another. Because we put this Part 70 activity 22 in the licensing application, the notice was required and 23 notice was given and notice was adequate. What we are trying
() 24 to tell you is academically we didn't have to put that in the 25 license application.
118 1 _ We could have gone forward under Part 70, and when 2 we went forward -- if we had gone under Part 70, it would have 3 been discretionary.
4 JUDGE MOORE: If you had done it under Part 70 and 5 if, as I believe your position is, that using Catawba to store i
6 Oconee/McGuire fuel is not a use that needs to be licensed 7 under Part 50, could you under a Part 70 license --
8 MR. McGARRY: Store spent fuel?
9 JUDGE MOORE: Store Oconee/McGuire spent fuel at t 10 Catawba if Catawba was never licensed.
11 MR. McGARRY: Absolutely. You know what my basis 3
12 is? Look at Morris, Illinois because that's exactly what O 13 happened. It's a Part 70 license and they are storing spent 14 fuel from every G.E. facility in the United States of 15 America. That's the answer to the question.
16 JUDGE MOORE: Morris has what kind of license?
1 17 MR. McGARRY: Morris was originally -- I believe 18 Judge Rosenthal probably knows this better than I. It's a 19 Part 70 license. I checked that out yesterday because I 20 thought you had would ask the question. That is the answer.
21 You can store spent fuel under a Part 70 license. That's the 22 answer.
23 Look at Barnwell. Barnwell starts out as a Part 50 24 case, and it's a reprocessing facility, and reprocessing 25 stops. Then they decide, well, we will store spent fuel.
~. - _ ~ . - . ~ = . - . - .
119
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l _ Look at -- I think it's 3 NRC. I was just checking 2 the caption. It turns into a Part 70 case. They are not 3 storing the spent fuel at Barnwell, but it turned into a Part 4 70 case.
l 5 JUDGE MOORE: Was West Valley the same way as 6 Morris?
7 MR. McGARRY: I'm not sure of West Valley. I think 8 West Valley may be Part 50, but I found that interesting. We 9 are checking into that. I don't have the. final answer on i 10 that. The point is I can tell you M' orris is Part 70.
11 It's interesting. I went back and looked at the 12 transcript, read it closely, and I particularly focused on l 13 you, Judge Moore, because you had the initial concerns, not to 14 say that neither one of the other judges have concerns. Where 15 I think you are coming from is you are troubled that this i
16 activity could take place and there may be no notice, and that 17 just doesn't seem right to you.
18 What I am telling you is -- what I would suggest to i
19 yqu is that you should no't worry about that. That's a problem l 20 for the Commission because if we chose to proceed under Part i 21 70, which we didn't, then the Commission has to bite that 22 bullet, as Judge Rosenthal suggests, either Staff or the 23 Commission in their discretion. And there may be notice or O
24 may not, but if there is not, they better have some good 25 reasons.
120 1 _ Now, if we chose to proceed under an amendment to 2 Part 50, there would be notice because we would be under the 3 Sholly provisions. There would be notice of the provision.
4 Your concern -- that is, but what if it's a no significant 5 hazards? -- well, that is again a determination for the 6 Commission, determination for the Staff, and shouldn't concen 7 you.
8 We make an adequate demonstration there are no 9 significant hazards even though it has been advance notice.
10 We can then get the authorization to conduct this 11 activity. But again, in either instance, somebody at the 12 Commission has to make a decision with respect to notice. We 13 cannot simply submit this piece of paper and willy-nilly get 14 it stamped and off we are on our way.
15 There is some check, and I think that is your 16 concern.
17 JUDGE MOORE: If notice is required -- just assume 18 that for the moment -- and you are doing it under a Part 50, 19 no Part 70 license, and you seek to amend Part 50 license so 20 that you can store fuel generated off site on site, and you 21 have two units and two fuel pools instead of a common pool so 22 you are going to do both of them at once -- and since it's my 23 hypothetical, notice is required, as you would concede such is 24 Part 50 -- since notice is required in each instance, and if 25 you did them separately, there would be a notice that said to
\
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amend fuel pool for Unit 1, and the other one to amend the fuel pool for No. 2 to accept fuel generated off site -- if 3 you combined the two into one action, could the notice say to 4 amend the licenses for both but only talk about accepting fuel 5 from off site for one of them and then have reference to the 6 actual amendment where it says you are going to do the same 7 activity for the second one? Would that notice be sufficient?
8 MR. McGARRY: Let me make sure I understand it.
9 Catawba Unit 1 and Catawba Unit 2. Assume that there are two 10 separate spent fuel pools. You are sugg.esting that Duke would 11 come in and, while it could seek an amendment individually on 12 each docket, it combines them but references the two 13 documents, so we are amending the licenses of both; but then 14 where I got confused is the activity would only apply to the 15 first spent fuel pool.
16 JUDGE MOORE: Pursuant to 105, the nature of 17 the action, it just speaks about one of the pools and that you 18 are going to store -- you are seeking amendment to store fuel 19 generated off site in this pool, and you never say that about 20 the second pool in the notice. But in the actual application, 21 there it is, and all you do in your notice is reference the 22 second application. Is that notice sufficient?
23 MR. McGARRY: I have to say yes, it is, because I 24 know the analogy you are drawing, and that is looking to the 25 Catawba Federal Register notice.
122
~) 1 _ JUDGE MOORE: It is required if you did it (G
2 separately, but it's not required -- your answer, then, it 3 would seem to be it's not required if you combine them.
4 MR. McGARRY: It's not required if you conbine 5 them. The notice that you reference both spent fuei pool 6 activities. I see where you are going. I gave you the answer 7 because that is the consistent answer with the position we are 8 taking, but I'm having trouble really appreciating that 9 question. I understand what you are saying. I hope to come 10 back to that.
11 JUDGE ROSENTHAL: I'm having trouble fully grasping
- 12 your position on one aspect of this. Do I understand you to 7
V) 13 say that because you chose to include this in your receipt and 14 storage proposal in your Part 50 application, because of that, 15 notice was required here? Or at least that this hinges on 16 whether the notice that was given was, as you insist, 17 adequate?
18 MR. McGARRY: Let me give it to you again.
19 JUDGE ROSENTHAL: I want to make sure I understand 20 it. I understand your basic position that this is a Part 70 21 matter, not a Part 50 matter as a general proposition and that 22 you would not have to give notice. Now, you did mention the 23 fact again that you had included the receipt and storage n
(_-) 24 proposal in your Part 50 application for operating license.
25 What followed from that, in your view?
123
( j 1 _ MR. McGARRY: Let me give you the reason we advanced V
2 the Part 70 argument. We look at what actually happened in 3 this case, and we took what is clearly a Part 70 activity, and 4 we put it in part of our license application. The Act and 5 regulations require that a license application be noticed, so 6 therefore, those aspects contained within the license 7 application are to be noticed. Spent fuel storage is part of 8 those aspects, so it is part of the notice. But we gave you 9 the Part 70 argument to say -- to give you some comfort of why 10 it wasn't necessary to spell out tha't particular activity or 11 any other particular activity in that license application, 12 because if we look at typical experience and licensing and 13 noticing, I dare say if you went and looked at Comanche Peak 14 or you went and looked at Robinson, the notice of the 15 operating license would be to say go look at the license 16 application.
17 But we then said to you that, Part 70, we really 18 didn't have to do that, so that should give you some comfort 19 if you are troubled by the lack of a particular paragraph. It 20 really wasn't necessary. That's why we made that argument.
21 JUDGE ROSENTHAL: Now, if we were to conclude that 22 the incorporation by reference does not carry the day, that 23 the notice should have had a sentence added to it to the 24 effect that in addition to seeking authorization to run this 25 facility for electricity generation at whatever rated power,
124
() I the Applicants intend to or seek authorization to store on the facility site spent fuel generated elsewhere, supposing we 2
3 come to that conclusion, chat you should have had that 4 additional sentence.
5 MR. McGARRY: Okay.
6 JUDGE ROSENTHAL: What follows from that?
7 MR. McGARRY: If you were to conclude that, what 8 follows, what I hope you would have said is they were actual 9 notice. I, don't see how you can walk away from actual notice.
19 JUDGE ROSENTHAL: All righ't. I will answer that 11 question this way, and I will say, well, obviously the 12 Palmetto Alliance and the Carolina Environmental Study Group 13 had actual notice. They turned up and raised this issue. But 14 there is a lot of folks down in North Carolina and -- or is it 15 South Carolina?
16 MR. McGARRY: South Carolina.
17 JUDGE ROSENTHAL: And we.are not in a position to 18 say that everybody reading that notice, which stressed the 19 electric generation aspects of it, would have perceived that 29 it also embraced --
21 JUDGE MOORE: Jurisdiction cannot be expanded by 22 actual notice.
23 MR. McGARRY: Hold the jurisdiction. How can you 24 walk away from the newspaper articles that we attach with the 25 bold headlines and the case law both here at the Appeal Board
i 125 1 and the F,ederal case law? We will get to jurisdiction in a 2 minute. But how can you walk away from that saying notice i
3 wasn't adequate?
4 JUDGE ROSENTHAL: I have said on several decisions, i
5 talking about prior Appeal Board deciaions, people are 6 obligated to read the Federal Register, and that is because 7 the Supreme Court has said that the Federal Register i
l 8 constitutes constructive notice. I am not certain that I'm i
l 9 prepared to speculate, Mr. McGarry, on whether everybody 19 reads the Rock Hill Gazette or whate'ver the newspapers are we 4
j 11 are talking about. That kind of speculation I'm supposed to 12 engage in? They are held to read the Federal Register.
13 They are not held to read anything but that.
14 MR. McGARRY: I feel very comfortable in the i 15 position, the case law of both the Appeal Board and the 16 Federal case law, that any defect in the notice can be cured.
17 I think we cited the cases that show if no one is complaining 18 about this, which isn't the case, the Boards really ought not 19 to step in, the courts really ought not to step in. I feel 29 very comfortable in those cases.
21 JUDGE ROSENTHAL: Let's go to the jurisdictional 22 question. Again, there is Appeal Board authority, which you
{ 23 acknowledge, to the effect that the Licensing Board has to 24 take a look at the notice of hearing or opportunity for i 25 hearing in determining what it can consider, and if it is l
1
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126 1 something beyond the bounds of that notice, that is off-limits 2 jurisdictionally.
3 Now, you suggest correctly the jurisdictional 4 question is entirely separate and distinct from actual 5 notice. This is something that goes to what the Board can 6 consider irrespective of whether every citizen in South 7 Carolina is fully aware that you folks were interested in 8 storing Oconee/McGuire spent fuel at Catawba.
9 How do you deal with the jurisdictional question?
10 Assuming that the notice just didn't' cover this. And that 11 might be whether or not the notice was required. The Board 12 can only do what it is given the green light to do by a notice O 13 of opportunity for hearing.
14 MR. MC GARRY: I think the Appeal Board is aware of 15 the fact that this question was raised by the Licensing Board.
16 JUDGE ROSENTHAL: Yes.
17 With due respect to the Licensing Board, it didn't 18 seem to me when it eventually answered it in your favor, it 19 gave very much illumination as to the analysis that led it to 20 the conclusion it reached. So, I am not so sure I am prepared 21 to attach a great deal of significance to the fact that it was 22 raised before the Licensing Board and that Board decided it.
23 MR. MC GARRY: I'm not trying to attach a tremendous 24 amount of significance. I just wanted to call that to your i 25 attention. Obviously you are aware of it.
127 1 _ As you know, our position, the one I have already 2 stated -- and that is it is part of the licensing application 3 and that according to Judge Salzman and other cases I have 4 cited is sufficient --
5 JUDGE MOORE: Just a moment. The application --
6 MR. MC GARRY: Is part of the notice.
7 JUDGE MOORE: -- is an incredible bit of paperwork 8 in the Nuclear Regulatory proceedings. Because what is 9 encompassed by the application, isn't it literally a 10 relicensing document as part of the application?
11 MR. MC GARRY: I believe there is actually one 12 volume that is titled Licensing Applications. I think in this 13 instance it was like, 12 pages. It is 12 pages.
14 JUDGE WILBER: And this is what you consider the
's application, not the attachments to it?
16 MR. MC GARRY: There are attachments which, indeed 17 as you well know, had the FSAR and are volumes.
18 JUDGE MOORE: So we are talking now 28 feet of shelf 19 space, is the application. There is no bound to the 20 application if that is what is setting the jurisdictional 21 limits. And if that is the case, then one is quickly back to 22 incorporation by reference.
23 Are there bounds as to what can be incorporated by 24 reference reasonably?
25 MR. MC GARRY: All I can say is if you will look at
128 7
I the expecience of the Nuclear Regulatory Commission, operating
( )
2 license notice will say, go look at the licensing application.
3 JUDGE ROSENTHAL: I understand that Mr. McGarry.
4 But do you know of any other notice su'ch as this which covered 5 an application that in turn covered not merely proposal to use 6 the facility to generate electricity and everything incident 7 to that, but also contained an independent proposal such as 8 this one?
9 As far as I know, this is the first time --
10 JUDGE MOORE: There is a second with Shearon Harris, 11 and it is in front of us, too.
(s 12 JUDGE ROSENTHAL: But this one and Shearon Harris t
v) 13 are the first times that this has happened.
14 "o, when you refer to the standard notice having 15 this language, what that language is referring people to is an 16 application that involves solely a proposal to use this 17 facility to generate electricity.
18 MR. MC GARRY: Your Honor, let me give you an 19 analogy or a fact. And that is, in a McGuire case, part of 20 the licensing application includes the authority to transship 21 the spent fuel 2000 miles away.
22 JUDGE ROSENTHAL: True.
23 MR. MC GARRY: That is consistent with Table S-4. Is IA)
\_/ 24 that called out so people in Yakima, Washington know about it?
25 JUDGE ROSENTHAL: I would suggest, Mr. McGarry, that
129 7m 1 somebody_looking at a proposal to use a facility for
( )
2 generation of electricity would, or at least should understand 3 that the generation of electricity involves the generation of 4 spent fuel, and the utility undoubtedly will make arrangements 5 eventually to dispose of the spent fuel off site.
6 I don't think that is the same thing at all as the 7 signal that we are going to use this facility not only to 8 generate electricity and everything that goes along with that, 9 but we are also going to use it to store spent fuel generate-10 at other facilities. In other words, at least as a temporary 11 repository for spent fuel from other nuclear facilities.
f-, 12 They are two different things, it seems to me.
V MR. MC GARRY: You asked me, am I aware of any other 13 14 cases. The answer is no, I am not aware of any other cases.
15 JUDGE ROSENTHAL: So this one and Shearon Harris are 16 the first time that this has happened?
17 MR. MC GARRY: To my knowledge.
18 I am still trying to come up with an answer for you, 19 Judge Moore on the question you had asked, because I know it 20 is troubling you.
21 JUDGE MOORE: In the interim, why don't you tell me, 22 on page 10 -- I think it is on your June 7th filing -- you
! 23 made -- in disagreement with the Staff you say:
(3
( -)
s 24 " Contrary to the Staff's current position, the SNM 25 License amendment was not granted pursuant to Section 103 of
130
() I the Act,_but rather was issued pursuant to Section 53, 42 USC 2 2073."
3 What is the basis for you concluding that it was 4 issued pursuant to Section 53?
5 MR. MC GARRY: We referenced 53 because that is the 6 authority with respect to special nuclear materials in the 7 issuance of licenses.
8 And your question is, what is the basis for saying 9 that is what it was issued pursuant to?
10 JUDGE MOORE: The license doesn't say it is issued 11 pursuant to section --
gx 12 JUDGE WILBER: This is the SNM license for McGuire?
13 JUDGE MOORE: Yes. That is all in reference to 14 McGuire.
15 MR. MC GARRY: What we say is a part 70 license is 16 issued pursuant to part 53. It may be rolled into and 17 incorporated in part 50 pursuant to 10 CFR 50.31. But the 18 SNM license -- there is no authority under 191 and 103 to 19 issue an SNM license. You have to get that under part 53.
20 That is what we are saying here. Which is 21 interesting. It comes back to this "use" question. It is a 22 clear dichotomy.
23 JUDGE WILBER: When they issued the Catawba license, 24 did they ever mention Section 53? The only thing I recall is 25 103, right?
131 1 ,, MR. MC GARRY: I'm not sure about that.
2 JUDGE WILBER: And that is what your application 3 references, only 193.
4 MR. MC.GARRY: That's correct.
5 JUDCE WILBER: So, where is the authority to handle 6 SNM in 193? You claim that is not a use.
7 MR. MC GARRY: That is correct. And we are saying 8 an'y authority for SNM comes through Section 53. But, you can 9 roll in a part 79 Section 53 license into a part 191 or part le 193 license, and that is what we did' in this instance. We 11 rolled it in. It was incorporated by reference, if you will.
12 JUDGE MOORE: With the exception of spent fuel being O 13 generated at one facility and stored at another, are there any 14 lurking in the future?
15 I'm asking you to pull your crystal ball out. Are 16 there any other.of these lurking around -- questions of what 17 is and is not a use, that you can think of:-
18 MR. MC GARRY: No. In fact, we think this is 19 probably the first time it was raised. We think the Staff is 29 plowing new ground.
21 I'll tell you what has confused nie. When you asked 22 me that question I was writing something doNn. I wanted to 23 ask you why isn't the Price Anderson matter dispositive?
24 When it was brought to our attention the first time 25 we didn't appreciate it. We really didn't explore it in
132 1 detail. _But when you called it to our attention, we said to 2 ourselves, " Gee, the Appeal Board has given us a homerun ball 3 here."
4 We look at it as clearly dispositive that it says it 5 is not a use. It is an ancillary activity.
6 Maybe I will just say that in closing. That is how 7 we view it.
8 JUDGE ROSENTHAL: Mr. McGarry, we will give you a 9 period of time for rebuttal. We are not going to observe the 19 time limits that rigidly this morning.
11 MR. MC GARRY: Thank you.
12 There is just one point, Judge Rosenthal, with 13 respect to Judge Wilber's question. It was just pointed out 14 to me by Mr. Carr, that if you did look at the Catawba license 15 they do say the license was issued to certain parts, and one 16 of the parts was part 79. Right at th9 top of the license.
17 JUDGE WILBER: Is that the --
18 MR. MC GARRY: That's the Catawba license.
19 JUDGE WILBER: That is a boilerplate on all 29 licenses.
21 MR. MC GARRY: That is correct. So we are saying 22 any 70 activity, while 53 is called out, it is implicit 23 since there is a reference in part 79.
24 Thank you very much, your Honor.
25 JUDGE MOORE: One final question, Mr. McGarry.
133 1 _,Is it your position basically that by happenstance
/}
2 the Staff has stumbled into the right answer on all of these?
3 It was coincidence, that they really were doing it under part 4 70 and they didn't know what they were doing, essentially?
5 MR. MC GARRY: A quick aside. When you said "one 6 last question," my neck stiffened, because that is how this 7 all started at the last oral argument.
8 (Laughter) 9 But, the answer to this question, did the Staff le stumble into this and now they have'come up with the right 11 answer?
12 With all due respect to the Staff, I don't think O 13 they thought it through.
14 JUDGE ROSENTHAL: All right.
15 Mr. Johnson?
16 ORAL ARGUMENT ON BEHALF OF THE NRC STAFF BY MR. JOHNSON:
17 18 JUDGE ROSENTHAL: I must say that it is refreshing 19 occasionally to have the Staff and Applicant on different 20 sides. It may add some, at least, modest element of 21 credibility to this system.
22 JUDGE MOORE: Mr. Johnson, how does GE's facility 23 accept fuel under part 70 license as Mr. McGarry says it does?
) 24 MR. JOHNSON: It is my understanding, your Honor, 25 that it is not a utilization of a production facility, and
134
[ l that is the reason.
2 JUDGE MOORE: So that takes it out from under the 3 proscriptions of meeting part 50?
4 MR. JOHNSON: Yes, sir.
5 JUDGE MOORE: What is that facility?
6 MR. JOHNSON: I don't profess to be an expert on the 7 .GE Morris facility, but I do know it is not licensed under 8 part 59, 9 JUDGE MOORE: Does it hold a part 70 license?
19 MR. JOHNSON: As far as I understand, the facility 11 is not licensed, period. It is the fuel that is licensed.
12 JUDGE WILBER: I thought you couldn't ship the stuff 13 unless you had a recipient who is licensed.
14 MR. JOHNSON: That's correct.
15 But in this case, I believe -- and again I am 16 treading on thin ice because I am not that familiar with this 17 facility and that operation -- but.I do know in the final 18 rulemaking for the part 72, the independent spent fuel storage 19 installation, it was cited that there were three other 29 installations which stored spent fuel. Two are licensed under .
21 part 59, I believe, and one under -- or, two under part 79 and 22 one under part 59 -- or the reverse.
23 That is the basis of my knowledge.
24 But, what I am saying is the authority to store that 25 fuel is pursuant to part 79.
}
135
(~]
\_/
1 _ JUDGE MOORE: And that is as you just stated, a 2 license for the material, not for the physical structure into 3 which the material is placed?
4 MR. JOHNSON: If you will read, Mr. Wilber, the 5 Statement of Consideration for part 72, it sets this out in a 6 fair amount of detail as to the distinction of why, in issuing 7 the rule for Independent Spent Fuel Storage installations, it 4
8 isn't the facility that is being licensed, but the fuel.
9 JUDGE WILBER: Who holds the licen.se for the fuel 10 then, the utility?
11 MR. JOHNSON: Yes. It depends on what we are 12 talking about. If we are talking about -- for example, there 13 is an application to store spent --
14 JUDGE WILBER: I'm talking about the fuel that may 15 be at the Morris facility. I understand this is a storage 16 facility now?
17 MR. JOHNSON: Again, I don'.t know. But I would 18 imagine it is held by the owner of that GE facility, and not 19 the original owner of the f'uel. But I cannot say for
.20 sure. But, that is what I believe to be true.
21 JUDGE ROSENTHAL: Mr. Johnson, Mr. McGarry suggested i
22 to us that Price Anderson notice that we asked the parties to 23 familiarize themselves with represents a homerun ball for his 24 side. Do you agree with that?
25 MR. JOHNSON: Not at all, sir. We have read that
1 136 notice and, in fact, we cite it in our initial brief,
-\me f'} l 2 post-argument brief in a footnote. We believe that that 3 statement by the Commission is not a dispositive statement of 4 the meaning of the term "use" or the scope of licensed 5 activity pursuant to Section 103 for the following reason:
6 First, the focus that was on indemnification of fuel 7 on the Part 170 and what was required to be indemnified under 8 Part 170 and did not address in fact at all whether the 9 storage of spent fuel at the recipient facility was a licensed 10 activity at the recipient facility. If you read the note 11 carefully, it only addresses whether it was a licensed 12 activity at the sending facility.
O 13 But there are two, I think, even more important 14 reasons why we cannot consider that Commission statement to be 15 dispositive.
16 First, there is a major distinction between what is 17 required to be indemnified under Part 170, and what is 18 required to be regulated under Section 101 and 103.
19 The purpose of Price Anderson indemnification and
.20 the requirement for' insurance is much narrower than the 21 purposes of the act in general.
22 If you look at the legislative history and the 23 statements of the Congress in the Atomic Energy Act, you will A
(,) 24 see that regulation of the uses of atomic energy were to be 25 primarily in the national interest, to protect the common
l 4
l 137 l l defense and security, as well as the public health and safety,
}
2 and you will see that that language is found in both the 3 findings provision of the act in Section 2(e) where it says, 4 regulation of utilization facilities is "necessary in the 5 national interest to assure the common defense and security, 6 to protect the health and safety of the public," and if you 7 look the Purpose Provision, Section 3, it says the act's 8 purpose is to provide for "a program for government control of 9 possession, use and protection of atomic energy and special 10 nuclear material, so directed as to'make the maximum 11 contribution to the common defense and security in the
- 12 national welfare."
. 13 Finally, in the definition of utilization facility, 14 it states, "A utilization facility means any equipment or 15 device determined by the Commission by rule to be capable of 16 making use of special nuclear material in such quantity as to 17 be of significance to the common defense and security, or in 18 such manner as to affect the health and safety of the public."
19 These were the purposes for which regulation of 20 utilization facilities under 103 and 101 were set forward. We 21 believe it is a much broader purpose than Price Anderson 22 authority, which is to identify for certain uses of fuel, and 23 it focuses on public liability arising out of nuclear
( 24 incidents, because of injury, property damage offsite, or 25 death to persons arising out of the hazardous properties of
138 I 1 nuclear material. That is the focus of Price Anderson.
\ .))
2 Certainly there is no purpose that I can see that is as broad 3 as the interest of common defense and security, or the broader 4 aspects of public health and safety. It's a narrower focus. l 5 Secondly, as a matter of practice, the Commission 6 does not indemnify all activities undertaken pursuant to 7 Section 103.
8 The best example is found in the Catawba case 9 itself, and in every other construction permit case. The 10 Commission does not indemnify the ho'ider of the construction 11 permit upon issuance. It does not indemnify the activity 12 until fuel is shipped onsite, and a fuel license and material
%^J And you will find the requirement for that 13 license is issued.
14 in Section 140.13 of 10 CFR, and you would also find that all 15 the other verbs that are contained in Section 103 do not ipso 16 facto require indemnification. Acquire, transfer, export, 17 import. It's the presence of fuel, nuclear material, that 18 requires the indemnification, and therefore we would say that 19 the purposes of that notice and discussion of what requires 20 indemnification and doesn't is not dispositive of what is use 21 or what requires to be licensed under Section 103.
22 JUDGE ROSENTHAL: You say that's a Wash item? It I 23 doesn't really add anything to either side of the b
N/m 24 controversy? Or would you try to glean some support from your 25 position out of it, or what? You keep saying it's not L
139
~
[ ) 1 dispositive, and that leaves me with the question what is it?
2 Is it helpful at all, or is it something we should simply 3 disregard?
4 MR. JOHNSON: It seems to me it can be used in both 5 directions. Superficially it looks like if you don't examine 6 what was done and what Price Anderson Act authority is all 7 about, it seems to be saying that the storage of spent fuel 8 away from a reactor is discretionary activity, therefore it's 9 not licensed under Section 103.
10 It seems to me if you read the notice carefully, it 11 doesn't even address whether it's use of recipient activity or 12 license use at the recipient facility.
13 JUDGE ROSENTHAL: You are saying it's not helpful at 14 all?
15 MR. JOHNSON: It's not helpful in that direction.
16 Secondly, when you look to see what the Commission 17 decided to do in fact, it decided only to indemnify Duke Power 18 Company pursuant to the issuance of the McGuire Unit 1 19 license.
20 If you look toward the end of that notice, it says 21 we will not indemnify this fuel until or unless an operating 22 license for McGuire Unit 1 is issued.
23 Therefore, the rest of it sounds to me like an.
24 advisory opinion because in fact they weren't -- if it was 25 pursuant to Section 103 license, it would seem under their
140
() 1 rationale to be mandatory, and that's what they did, that's 2 what the Commission did do.
3 JUDGE MOORE: If Catawba had not been licensed under 4 Part 50, could the utility store Oconee-McGuire fuel there 5 pursuant to the Part 70 license?
6 MR. JOHNSON: That would depend on whether the 7 Catawba facility is a utilization facility under the act.
8 JUDGE MOORE: For the moment, assume that it was 99 9 percent complete, with quality assurance difficulties that 10 made it uneconomic to go forward with it.
11 MR. JOHNSON: I would like to qualify what I say 12 here, because it is treading on ground that's very delicate.
13 But it is my belief that at some point a facility does become 14 a utilization facility, and at that point -- it may be at 99 15 percent, it may be at some other point, depending on what the 16 configuration is and what is being done there --
17 JUDGE MOORE: Assume for some reason they gave up 18 the ghost on the plant and just are going to use the pool.
19 Could they do that under a Part 70 license?
.20 MR. JOHNSON: I would say, using the definition of 21 utilization facility contained in the act, if it was capable 22 of using atomic energy, no.
23 JUDGE ROSENTHAL: If it's constructed to the point 24 where it could be used as a production utilization facility, 25 that's enough, it wouldn't make any difference that, as in the
l 1 l 141 l 1 1 case of'a Midland or a Zimmer, the utility had announced, for
(}
2 whatever reason that it was abandoning the use of the facility i- 3 as an electric generating station? j
- 4. MR. JOHNSON: I agree with that.
5 JUDGE MOORE: And you would not require any license l 6 for the pool, then?
j 7 MR. JOHNSON: In what circumstance? I'm sorry, I'm
^
8 not following you.
9 JUDGE MOORE: Well, assume that the Catawba facility f
1 19 is being built, construction permit'is issued, and for
'll whatever reason the pool is completed years in advance of the f
12 remainder of the facility, and the pool is operable, and they
) 13 now seek to store Oconee-McGuire fuel in it.
14 MR. JOHNSON: That's an interesting question. If
- 15 you look in the regulations on what is considered to be a L
4 16 utilization facility, it specifically says that the Commission i 17 at this time has not decided whether any component or part of 18 the nuclear reactor is a utilization facility.
i e 19 So I'm treading on new ground here. I would say it j
29 is quite possible that if that's the only thing that is there, i
21 then it is not a utilization facility, but let me qualify 22 this, because there is language in Part 72, that statement of 23 consideration, the final rule that I mentioned to you before, ,
() 24 that says -- and this was in connection with a definition of
. 25 what spent fuel would be that could be stored there, at 72.3
! t i
. -.--- -.,--...._.-.,.~. - --,_.-._ - ,._. _ . ,,-,_ _ _ ._,. . . _ _ _ _ . _ - _ _ . ..w_.-.,,,___.-,--
142
() 1 2
it defines the spent fuel to be fuel that has decayed at least one year, and it says that is the only kind of fuel that can 3 be stored under Part 72.
4 If the fuel is going to be decayed less than a year, 5 it has to be' stored pursuant to Part 59. The facility would 6 be licensed under Part 50 rather than Part 72.
7 So it is conceivable that if the fuel was to be
~8 stored there, the Commission might say -- might want to issue 9 a Part 50 license, but I am not sure it would have to. I'm 19 not sure what the answer is.-
11 JUDGE ROSENTHAL: Mr. Johnson,-the Applicants, as 12 you know, suggest in their June 7th filing that the 13 legislative history of 191 and 193(a), fairly read, suggests 14 that all that Congress had in mind by use was, in this 15 context, the generation of electricity and whatever was 16 incident thereto.
17 Now I would be interested in, one, your views on the 18 Applicants' use of legislative history; and two, whether you 19_ are aware of any legislative history which suggests the 20 broader meaning of the term use that you have offered us.
21 MR. JOHNSON: Yes. I am aware -- to address'your 22 latter point, I am aware of legislative history, and I will 23 cite it.
24 Their argument is more or less based on the purposes 25 -- their interpretation of what the purposes of the act are.
143
() 1 And I already discussed at some length what the purposes are.
2 And they are very broad.
3 It is our position that Congress intended the 4 regulation be authorized under Section 103 to be very broad.
5 And, as you mentioned, the common meaning of use is so 6 apparent and there is no definition anywhere in the act of the 7 term use, and it is used many times, that suggests in the 8 absence of any indication to the contrary that it ought to be 9 employed as legislative language, according to the meanings by 10 which it would be understood by the public.
11 JUDGE ROSENTHAL: What about the Applicants' f ~g 12 suggestion that under your definition of use, if they decided L) 13 to put a training facility on the site, that would require a 14 notice of opportunity for hearing? Obviously you don't agree 15 that it goes that far. What is the distinction as you see it?
16 MR. JOHNSON: The question really is, does it 17 involve the health and safety of the public and the common 18 defense and security with respect to the activity that has 19 been licensed under Section 103? If it is affecting the 20 safety of that facility, then any use inconsistent with that 21 must be regulated to prevent inconsistent use in the interest 22 of the health and safety of the public, common defense and 23 security.
24 It is important, I believe, if you read -- now I'll 25 get to the legislative history. The committee report that
1 144
() 1 accompanies the- Atomic Energy Act of 1954, Senate Report 1699, states, Section 101 contains a prohibition against having or 2
3 dealing with any utilization or production facility, except 4 pursuant to a license issued by the Commission.
5 We believe when this language of having or dealing 6 with any utilization facility is considered in light of the 7 purposes and finding sections about the broad scope of 8 regulation that was intended, I think it is quite clear that 9 Congress intended a very broad meaning to be given to the is words that are in Section 103 and were in Section 103 at that 11 time.
s 12 "Use" was added later, but the Congress admitted, it 13 is true, as the Applicants have said, that the staff opposed 14 the amendment, but they only opposed it because they felt it 15 was implicit, because the other language implied use, 16 possession for use, manufacture, whatever they had in mind 17 implied use. And use was contained in Section 50.10 of the 18 regulations, pursuant to the language in the statute of 103 19 that did not contain the language "use".
20 So the only way you could reach that result would be 21 if you took a broad view of the authorization in Section 103 22 and not to view it as strict enumerative type of approach that 23 anything that's not specifically mentioned is excluded.
O k/
m 24 I think the purposes and findings of the Congress, 25 the whole scheme that it set up, is consistent only with a
145 1 broad vigw. And we believe that the fact that the Staff 2 opposed the addition of "use" or that it was considered to be 3 implicit, isn't really dispositive of whether "use" and the 4 '
language in Section 103 should be considered very broadly.
5 JUDGE ROSENTHAL: Let me ask you this:
6 Let us assume that we were to adopt the Applicants' 7 narrower view of the term "use." Was it nonetheless necessary 8 for there to be in this instance a notice covering the 9 receipt and storage proposal for the reason.that the Applicant 10 chose to put the receipt and storage proposal in their Part 50 11 application?
12 In other words, do we really need to get to this use
' 13 question in order to determine whether, in this particular 14 instance, a notice einbracing the receipt and storage proposal 15 was necessary?
16 MR. JOHNSON: I think so, in the broadest sense, 17 because the question really should not turn on how or what 18 option the Applicants took in proceeding here. What they have 19 suggested is we could have done it this way, it would have 20 been discretionary and no notice was required and we didn't 21 have to have a hearing.
22 on the other hand, we could have done it this way.
23 In that case, if we did it this way under Part 50, notice was O
C/ 24 required and an opportunity for hearing was required. We 25 don't believe that Congress intended the scheme to work that
146 I way. We_believe it should turn on the nature of the activity
[)
2 and based on the nature of activity, notice ought to be 3 required or not, and not an option a utility might make in 4 making an application.
5 JUDGE MOORE: By the same token, if something is 6 required by the regulations to state the nature of the action, 7 if the option that the Applicant chooses to do it also should 8 not be determination of the outcome, should it?
9 MR. JOHNSON: That's right. By the same token, it
~
10 seems to me if the ultimate licensing action requires 11 amendment of the operating license, then that that is what
-~ 12 should determine --
7 i )
13 JUDGE MOORE: Let me give you the same example I 14 gave Mr. McGarry. Assuming Catawba had two fuel pools, and 15 that they were seeking a Part 50 amendment for each pool in 16 separate proceedings, and the nature of the actions pursuant 17 to 105 would have to be set forth in the notice, and the 18 nature of the action in that instance is to store 19 Oconee-McGuire fuel in fuel pool 1; and the then the second 20 license amendment proceeding, the nature of the actor is to 21 store Oconee-McGuire spent fuel in fuel pool 2. Clearly 22 that's what would be required under 105.
23 Now if those two license amendment proceedings were (0
_j 24 combined into one, what is the minimum that would suffice to 25 state the nature of the action?
147 l _ MR. JOHNSON: In a way, this sounds like the Catawba
(}
2 case. Because there is some notice there, but not express 3 notice of this application.
4 If you are saying that in the application that is 5 cited in the Federal Register notice for either or both units, 6 it is contained in the application and the public is referred 7 to the application, it seems to me it is the same case as the 8 Catawba case. It seems to me that may be determinative.
9 on the other hand, let me say this --
10 JUDGE MOORE: Your answer then suggests that by 11 combining them, you can state less in the notice than you can s 12 if you do them separately.
13 MR. JOHNSON: It depends on what the notice can be 14 read to say and what the terms of the notice are, it seems to 15 me.
16 Let me give you another example. In the notice to 17 store Oconee fuel at McGuire, the application was to store 18 Oconee's fuel from three units of Oconee at Unit 1 at 19 McGuire. Therefore, the scope of the application is limited 20 to -- the scope of the notice was limited to that and the 21 scope of the amendment was limited to that.
22 Recently Duke Power Company has come in with an 23 amendment to their application to their McGuire Unit 2 24 license, to store those same 300 Oconee spent fuel assemblies 25 at Unit 2 if it so desires. Either Unit 1 or Unit 2. We have
t i
148 l
[)
V 1 specifically noticed that. The Federal Register notice has an f 2 application to amend tha McGuire Unit 2 license.
3 Implicit in that is that notice is required. The 4 question that you asked did not say specifically whether we 5 deemed notice to be contained, and that is the determination, 6 I think, that it's implicit in that first notice and it's 7 enough.
8 JUDGE MOORE: Your position also is that anything in 9 the application can be incorporated by reference to the notice 10 effectively, even though the application would be 28 feet of 11 shelf space?
12 MR. JOHNSON: I'm not sure of anything, but I think
-^)
V 13 a reasonable amount. And in this case it was a reasonable 14 amount. It was stated in a very short paragraph at the very 15 beginning of the application, or in the first few pages.
16 These are the licenses we ask for. And it's right there in 17 the application. Materials licenses necessary to store spent 18 fuel from Oconee-McGuire at Catawba. I don't think that is 19 unreasonable.
29 JUDGE MOORE: If it was on page 100 instead of page l
21 12?
22 MR. JOHNSON: If it was part of the application, I 23 would still think it would be reasonable. If it were not in
[
's 24 the application, but just alluded to obliquely in some 25 technical provision about the spent fuel pool, I would say i
149
<3 i
) 1 maybe that's a good question.
v 2 JUDGE ROSENTHAL: Mr. Johnson, if we were to agree 3 with Mr. McGarry that a notice was not obligatory in this 4 instance, would then the Staff have to take another look at 5 this to determine whether a notice should have been issued as 6 a matter of discretion? I'm assuming also we found this 7 notice inadequate.
8 In other words, clearly here there was no exercise 9 of discretion on the Staff's part. The Staff issund this 10 notice as embracing the receipt and storage proposal because 11 it thought it was obliged to do so. If it was not obliged to g-^3 12 do so, there is apparently still the question as to whether it
( l 13 should exercise its discretion.
14 Would Staff then be called upon to do that?
15 MR. J0llNSON : Our position is that if the notice was 16 not adequate and it was required that we have to -- if you 17 decide that it was discretionary and you have essentially 18 nullified whatever effect we have given to that notice, then 19 it seems to me we would have to go back and decide whether to 20 -- and in fact it was a discretionary act, then we would have 21 to make that decision.
22 JUDGE ROSENTHAL: Let me ask you one more question, 23 and that is let's focus on the jurisdictional aspect of this O
\/ 24 just for a second, and there are prior holdings that a 25 licensing board's decision hinges upon content of the notice.
150 1 Now, if a, notice was not required here, and if the notice that 2 was issued didn't embrace the receipt and storage proposal, 3 then doesn't it follow that the Licensing Board shouldn't have 4 considered the matter at all, should have simply said we don't 5 have any jurisdiction over the receipt and storage proposal?
6 It's in the lap of the Staff?
7 MR. JOHNSON: If, in fact, notice was required --
8 JUDGE ROSENTHAL: No, notice was not required.
9 Let's assume the Applicant is right there wa.s no requirement le of notice, and therefore, in a sense, it makes no difference 11 whether this notice was adequate or not. We didn't have to 12 have a notice. But now we are looking at it from the O
13 Licensing Board's jurisdiction. From that standpoint. Now, 14 if the notice didn't cover the receipt and storage proposal, 15 then irrespective of whether notice was required or not, was 16 the Licensing Board precluded from getting into that?
17 The Licensing Board should have said perhaps this is 18 all very interesting but it's not on our table and it's up to 19 the Staff to authorize it as a separate matter or whatever 29 happens to it is none of our concern; all we have got are 21 those issues that were, in fact, put before us.
22 MR. JOHNSON: Yes, I understand. Yes, I think that 23 is what we would do. It would be considered a matter for the 24 Staff.
25 JUDGE MOORE Why couldn't the Licensing Board take
< 151 O
V 1 the opposite tack and say thete is nothing to preclude me from 2 asserting jurisdiction over it; it's not in the notice one way 3 or the other.
4 MR. JOHNSON: Well, it would have to make a 5 determination whether it was within the scope of the notice, 6 as it did, and whether expressly or implicitly or for whatever 7 rationale, that would be a determination of whether it had 8 jurisdiction, it seems to me, whether it was deemed to be in 9 the notice. If it wasn't in the notice, it seems to me the 19 case law is clear that it lacks jurisdiction and it would not 11 entertain that application.
12 JUDGE MOORE: Now, whether or not the notice 13 incorporates by reference the application, just assume the 14 notice says an application has been filed and the nature of 15 the action is described. Does the Licensing Board have 16 jurisdiction to consider anything in that application, any 17 issue that touches upon anything in that application?
18 MR. JOHNSON: I'm tempted to say yes, it does, but 19 it would be then based on incorporation by reference and the
.20 reasonableness of doing that.
21 The Appeal Board has touched on most of the major t 22 points that I wanted to make. I would just like to point out I
23 one additional point.
24 JUDGE MOORE: Let me interrupt, Mr. Johnson. Do you 1
25 agree with Mr. McGarry that we can duck this issue, that we
l 152 1 should? _
2 MR. JOHNSON: When you say conduct this issue --
! 3 JUDGE ROSENTHAL: Duck this issue. D-u-c-k.
l 4 MR. JOHNSON: I believe you don't have to reach the 5 issue because if you decide the notice was adequate, you need
- 6 not --
7 JUDGE MOORE: Assume you find the notice is 8 inadequate. We didn't have to reach it, in your opinion?
l 9 MR. JOHNSON: I would say yes. The point I did not I
le cover, just the question whether the Staff has acted 11 consistently or inconsistently on this matter, and it seems --
l 12 the Staff did state in connection with the issuance of the I (
l 13 generic environmental impact statement on the handling and 14 storage of spent light-water fuel, power reactor fuel --
15 that's NUREG-9575, issued by the Office of Nuclear Material 16 Safety and Safeguards in August 1979 on page 3 "Any l
l 17 reactor receiving spent fuel from another reactor will require l
18 an amendment to its operating license."
l 19 So this is not a new position that the Staff is l
25 taking here today or in these memoranda that we presented to 21 Your Honors, and we believe that the practice of licensing 22 this kind of activity under Section 193 has been consistent 23 and --
l 24 JUDGE MOORE: Is there any other similar issue that 25 the Staff in a notice does not state -- let me back up.
l L
[
153 j 1 _ can you give me an example of another type of use 2 where the Staff doesn't specifically highlight it in the 3 notice for opportunity of hearing?
4 MR. JOHNSON: Not in the sense that it is a 5 different business, so to speak.
6 JUDGE ROSENTHAL: Are there any other uses of a 7 production and utilization facility that are not integral to 8 the operation of the facility as a generating station? I 9 couldn't off-hand think of any possible use of one of these is facilities that would have health and safety overtones other 11 than using it as a repository for spent fuel generated 12 elsewhere.
13 Every other activity that I could think of was one 14 that was really incident to the use of the facility as an 15 electric generating station.
16 JUDGE WILBER: Excuse me. I think perhaps Midland 17 is an example where they were using steam. Did notice of 18 Midland say they were going to use steam as well as generate 19 electricity?
29 MR. JOHNSON: I don't have any idea. I'm sorry.
21 JUDGE WILBER: That's the only example I can think 22 of. I thought at one time Dow Chemical was going to purchase 23 steam from the Midland facility.
24 JUDGE ROSENTHAL: That was a by-product of the 25 electric generation process, I would have thought.
I l
l l 154 l
1 _ JUDGE WILBER: I thought they called it
)
2 co-generation. I may be wrong.
3 MR. JOHNSON: At the risk of not knowing what the 4 Commission did, in fact, do in that case, I would say the 5 position in general is that if it affects the health and 6 safety of the public, common defense and security, if the 7 activity involves the safety of the operation of the reactor, 8 the reactor facility in any way, then it is subject to l
9 Commission regulation.
la One of you mentioned an example -- I forgot what it 11 was -- an activity, just say, to build a heliport within the s 12 restricted area of the facility. That has nothing to do with 13 nuclear energy directly but it would be subject to regulation 14 because it would be inconsistent with the licensing of that 15 authority for the purposes and interests that the Commission l 16 is authorized to do. And therefore, even something that on 17 its face seems to have no nuclear fuel aspect, it seems to me, l
l 18 would be within the scope of the kind of things that we would 19 be required to review and authorize.
[
l 29 That's all I have.
21 JUDGE ROSENTHAL: THank you, Mr. Johnson.
l 22 Mr. McGarry, you may have a brief rebuttal.
23 MR. McGARRY: Thank you.
k/
m 24 JUDGE MOORE: Would you agree that Morris is not a 25 production and utilization facility?
l i
l
155
[}
v l . MR . McGARRY: No, I wouldn't. It's a production 2 facility. It's not a utilization facility. Catawba is a 3 utilization facility. Morris is a production facility. They 4 are both covered under 103.
5 JUDGE WILBER: Does it have a Part 50 license?
6 MR. McGARRY: It has a Part 70.
7 JUDGE MOORE: On what basis do you arrive at the 8 conclusion it is a production facility?
9 MR. McGARRY: Because that's what.it is. What basis 10 do I conclude that Catawba is a utilization facility? That's 11 what it is.
12 JUDGE WILBER: What does 103 have to do with a Part 73 ,
13 70 license?
14 MR. McGARRY: What does Part --
15 JUDGE WILBER: What does Section 103 of the Act have 16 to do with a Part 70 license? I thought we were talking 17 Section 53 was related to a Part 70 license.
18 MR. McGARRY: That is correct.
19 JUDGE WILBER: Now you are saying it's a utilization
.20 facility?
21 MR. McGARRY: I'm saying it's a production facility.
22 MR. WILBER: Production facility under Section 103.
23 MR. McGARRY: I'm sorry. There is confusion here. I Cl '
24 caused confusion. It was a production facility, that's what 25 it was, and that was under Part 50. It was a production
r 156 im
( ) 1 facility.
v 2 JUDGE MOORE: When you say it was, that is this other 3 half of it that never was operated?
4 MR. McGARRY: I don't know if it was reprocessing or 5 whatnot, but they had plans other than storage of spent fuel.
6 Those plans went awry.
7 JUDGE MOORE: Only after they built it.
8 MR. McGARRY: Only after they built it, 9 unfortunately. Then they changed it into the Part 70, so it 10 was a production facility originally, now it's simply a 11 repository for spent fuel. I think that answers that
,e') 12 question.
13 JUDGE ROSENTHAL: As matters now stand, it's not a 14 production facility.
15 MR. McGARRY: That's right.
16 JUDGE MOORE: Doesn't that explain how it got spent 17 fuel there under the Part 50 license?
18 MR. McGARRY: No. It's getting spent fuel today.
19 The Part 50 license was done and over with and no longer in 20 being ten years ago. It has been a Part 70 facility for 21 years.
22 JUDGE WILBER: Was it ever a Part 50?
23 MR. McGARRY: It got a provisional Part 50 license, f3
(_,) 24 I think, and then what happened was they were going through 25 their preoperational testing and they found out if they
157 1 clogged up certain pipes, they couldn't get in to repair them, 2 so rather than irradiate those pipes, they had to walk away 3 from the project. Then they decided to turn it into a Part 79.
4 JUDGE MOORE: Does the Act define a production 5 facility?
6 MR. McGARRY: I can't answer that, but I would be 7 shocked if it didn't.
8 JUDGE MOORE: What are the criteria for one?
9 MR. McGARRY: Let me get my Act and see.
19 Could I move on and someon'a else could look that up?
11 REBUTTAL ARGUMENT BY MR. McGARRY 12 MR. McGARRY: The first one is not rebuttal.
O 13 Obviously the Board does take the position that the notice is 14 adequate. We can't lose sight of that fact.
15 JUDGE ROSENTHAL: We are fully aware of that.
16 MR. McGARRY: Now, could Catawba have stored spent 17 fuel under Part 79? That',s a question Judge Moore kept 18 asking, and we say yes, they could. We kept mentioning Morris 19 because that is precisely what is being done. If we look at 29 the notice of July 28, 1978 -- it is always interesting. The 21 number one argument I had before the Appeal Board, the 22 specific date was my son's birthday. Well, this is my 23 daughter's birthday.
24 JUDGE ROSENTHALt I didn't know that.
25 MR. McGARRY: Small world.
158 O
v 1 _ (Laughter.]
2 If you look at that notice, which talks about the 3 Oconee/McGuire notice, they do not key it in to any of the 4 Part 59 activity. They acknowledge there is a Part 59 case 5 taking place, but then they go on and say the license won't 6 issue until two hoops are gone through, first until completion 7 of a safety evaluation, and second, unless favorable findings 8 are made pursuant to the Part 79.
9 Those are the only hoops. We didn't have to go 19 through a Part 59 hoop. I think that is significant.
11 Now, jurisdiction. I want to touch on jurisdiction 12 for a moment. Let me get the use one out of the way, with all 13 due respect.
14 The use argument assumes that there must be a 15 facility and that facility must be regulated because you are 16 going to store spent fuel, and it has got to be regulated 17 under Part 59. What is lost here or what the assumption is, 18 that a Part 79 license doesn't consider the facility, that a 19 Part 79 license lets you possess and let's you store, but a 29 Part 79 license doesn't ask any questions about a facility.
21 Well, that is nonsense, as this Board well knows, 22 especially Judge Rosenthal. In the Oconee and McGuire case, 23 which was a Part 79 case, we talked about criticality. We 24 talked about cask drop accident. We talked about the 25 facility, the cooling capability of the facility. You do talk
159 about the facility in a Part 79 license, so when you license
(( ) 1 2 under Part 79, it's not just possession and storage. You know 3 where you are storing, so there is no specific and separate 4 reason why you would have to proceed undet Part 50 to discuss 5 the facility.
6 Now I would like to turn to jurt rdiction. I think 7 there is some confusion -
8 JUDGE WILBER: Could I ask one more question on your 9 definition of use where it points only to the generation of la the electricity, as I understand it?
11 MR. McGARRY: That's our definition, yes.
12 MR. WILBERt If that were the case, did you even 13 have to mention the fact that you might be moving this fuel 14 from McGuire to Catawba?
15 MR. McGARRY: Not under Part 50, no, sir.
16 JUDGE WILBER: So that was just kind of an added 17 feature in your application?
18 MR. McGARRY: Quite frankly, we had just been 19 through the Oconee/McGuire. It was a separate case.
20 MR. WILBER: And yet you would have been authorized 21 to move the fuel to Catawba?
22 MR. McGARRY: We would have been authorized to move 23 the fuel to Catawba when Catawba was authorized to receive 24 that fuel or when Morris was authorized to receive that fuel.
25 Morris was authorized to receive that fuel under Part 70.
160 I '\ 1 Catawba could be authorized to receive that fuel under Part
~.)
2 70. Didn't have to proceed at all under Part 50.
3 That is precisely what we did in Oconee/McGuire, and 4 that is what the notice says. We sought authorization to 5 store Oconee fuel at McGuire.
6 JUDGE ROSENTHAL What would have happened if you 7 had done that? Let's assume that you hadn't said anything in 8 your Part 50 application about receipt and storage. What 9 would you have done? You would have filed an application as 10 you soo it under Part 70.
11 MR. McGARRY: We could have done that. We could fx 12 have filed amendment to Part 50 next year. Either one.
( )
~
13 JUDGE ROSENTHALt Then what would have happened?
14 There would have been no notice either way?
15 MR. McGARRY: No. That's what I told Judge Moore 16 about half an hour ago. Then one of two things. It would 17 have been discretionary under Part 70 or under Part 50 18 amendment it would have been the Sholly regulations. One or 19 the other.
20 But just so the Board knows why we did what we did, 21 we had just been through the Oconee/McGuire. We understand 22 that it was a sensitive issue. It was a separate proceeding.
l 23 We know we were going through the Catawba proceeding. We I
l ((~')
_ ,/ 24 said, all right, if we are going to go through the Catawba 25 proceeding anyway and it's going to be extensively litigated, L
t l l 161 1 then let'.s litigate this issue, too. Let's put it out in the 2 open, let any member of the public who wants to come forward 3 come forward, and let's litigate it. That was our intention 4 of why we put it in.
5 ' JUDGE ROSENTHAL: If that was your intention, to put !
6 it up for litigation, that brings you, then, squarely into i 7 that jurisdictional question.
8 MR. McGARRY: Now .I want to get to jurisdiction.
9 JUDGE ROSENTHAL: You disagree, I gather -- just so le I fully understand your position on'this. I asked, as you 11 know, Mr. Johnson whether he thought whether notice was l
12 required in this instance hinged upon whether or not you chose O 13 to include the receipt and storage proposal in your Part 59 14 application. He said, no, in his judgment it should not hinge 15 upon that at all. ;
16 Now, I gather in your judgment it does hinge upon 17 it.
18 MR. McGARRY: The mandatory notice comes out of Part 19 59.
29 JUDGE ROSENTHAL: No, in this instance a notice was 21 required because of the fact that the uti'lity elected to put i
l 22 the receipt and storage proposal in its 59 appilcation.
I i
23 MR. McGARRY: Correct.
24 JUDGE ROSENTHAL: Had it elected to go a different 25 route --
162
[~]
v 1 , MR . McGARRY: Discretion.
2 JUDGE ROSENTHAL: Discretion. So you and the Staff 3 disagree on that because the Staff says it shouldn't hinge on 4 your election.
5 MR. McGARRY: Then we disagree.
6 JUDGE ROSENTHAL I just wanted to make certain we 7 fully understand your position. So you chose to do this, as 8 you see it, to put it up for grabs, to give everybody an 9 opportunity to litigate.
10 MR. McGARRY: And it came out of the woodwork. We 11 had lots of contentions on it.
.- 12 JUDGE ROSENTHAL: Fine. Now, if your notice was
( !
'~' 13 adequato -- the Staff's notice. Excuse me. I recognize you 14 didn't write it. The Staff wrote it. If that notice was 15 adequate, then there is no jurisdictional problem. Why is 16 there not a jurisdictional problem if we find that the 17 incorporation by reference was insufficient with the 18 consequence that the notice only gave the Licensing Board the 19 green light on the use of Catawba as an electric generating 20 station and anything incident thoroto.
21 MR. McGARRY: I think you are confusing notice with 22 jurisdiction.
23 JUDGE ROSENTHAL Don't we have cases --
/O
(_,) 24 Mr. McGarry, I thought I was a participant in one of them 25 which said licensing board -- there were two of them. First
163
[~'N 1 there was the antitrust proceeding, and then there was i
\~s] l 2 subsequently the -- I guess that was Marble Hill, and I 3 subsequently, if I recall correctly, it was Trojan, where we 4 said that the Marble Hill principle was not restricted to the 5 endeavpr to inject antitrust issues into a construction permit
! 6 proceeding.
7 MR. McGARRY: And it is clear because the i
8 construction permit application had no antitrust information.
1 l
9 JUDGE ROSENTHAL: I understand, but the Trojan, I le thought we had some rather broad language in which we said I.
11 that that Marble Hill principle applies generally. I haven't s 12 got the precise language before me now. It was on Trojan, as 13 I recall. Now, didn't we hold there that the licensing board, 14 when it is deciding what it can consider, picks up the notice 15 which triggered the hearing?
16 MR. McGARRY: Correct.
17 JUDGE ROSENTHAL: So if the Licensing Board picks up 18 this notice --
19 MR. McGARRY: What do they look at? They see 20 language that says operating license application. Yes. And 21 then we get a license application.
22 JUDGE ROSENTHAL: But you are assuming that we are 23 going --
24 MR. McGARRY: You are confusing notice with 25 jurisdiction. That's the problem. With all due respect.
164 b _ JUDGE ROSENTHAL: Why are we confusing it?
[G 1 2 MR. McGARRY: Let's just forget notice. Forget 3 notice. We are looking at jurisdiction. Forget notice.
4 Don't even think about incorporation of reference is wrong.
5 Jurisdiction only. You say in your case law that jurisdiction 6 is determined by the notice of hearing. All right?
7 Let us look at the notice of hearing. The notice of 8 hearing says that this proceeding concerns the license 9 application. That's what it says. Forget incorporation of 10 reference. It says it concerns the operating license 11 application. The operating license. application is the scope gN 12 of the jurisdiction, and in that licensing application is this 13 spent fuel activity.
14 So the jurisdiction question is clearly answered.
15 The Licensing Board had jurisdiction.
16 Now you flip over to notice, and you are looking at 17 notice, and you say, now was the public notified properly?
18 I'm not sure if they were because incorporation by reference 19 gives me problems with respect to the public because it says 20 go look at the licensing application, and I would expect 21 people in Catawba, recognizing Catawba was going to be built, 22 would look at this, but, gee, I don't think these people 23 around oconee would ne expected to think that there may be
\_/ 24 this spent fuel activity around Oconee. So I'm troubled about 25 the incorporation by reference as it applies to the notice.
165 1 _ And then we go back to you and say there are 18
}
2 arguments why you shouldn't be concerned about notice. Actual 3 notice, incorporation by reference is good, but they do have 4 jurisdiction. That is crystal clear.
5 JUDGE ROSENTHAL: YOu say for jurisdictional 6 purposes it was enough that the notice said this is a notice 7 on an application.
8 MR. McGARRY: Absolutely.
9 JUDGE ROSENTHAL: And no matter what -- anything 10 that was in that application, ipso facto then became within 11 the four corners of the licensing --
12 MR. McGARRY: Unfortunately, that is the case. That O 13 is why we have 1732 contentions in some cases because 14 everything is fair game.
15 JUDGE ROSENTHAL: Now at least I understand your 16 position. It was not that clear to me until this point.
I 17 MR. McGARRY: I don't know if this helps, but you
, 18 had asked for the similar issues we raised in other cases. I 19 can't think of anything pre'cisely on this point, and I can see 20 where you might distinguish what I am going to suggest, but if 21 we look at a McGuire case or a Catawba case, the ice condenser 22 has been a very controver, sial piece of equipment. That wasn't 23 called on.
24 There are other activities that take place at a 25 plant, and I'm not sure whether they are noticed. Let me give
i
, 166 1 a for instance. I'm talking about a testing program where a 2 vendor will determine we want to get more knowledge with 3 respect to Charpy, V-notch tests with respect to 4 embrittlement.
1 l 5 JUDGE ROSENTHAL: How about mixed oxide fumes?
6 MR. McGARRY: I thought that was a thing of the 1 7 past.
8 JUDGE MOORE: It was noticed specifically, was it 9 not?
19 MR. McGARRY: I don't know.
11 JUDGE MOORE: The use of it? The use of it up in --
12 not Prairie Island, in the Michigan reactor.
13 MR. McGARRY: FERMI? It was probably FERMI.
14 JUDGE MOORE: Point Beach, I think.
15 MR. McGARRY: All I can assure you, it isn't used in 16 Catawba.
17 JUDGE MOORE: But that was noticed specifically?
18 MR. McGARRY: That may be. But again, ask yourself, 19 it's discretionary, and the commission decided to exercise its 20 discretion.
'21 JUDGE MOORE: Turn to the Atomic Energy Act, Section l l
! 22 11 in the definition section U and V.
23 MR. McGARRY: Right.
I 24 JUDGE MOORE: In looking at those definitions of
- 25 produce and production facility, how is the Morris spent fuel ;
1 I
167
() 1 pool, if_you will, a production facility?
MR. McGARRY: No, I think I changed that. I said it 2
3 was a production facility independent of spent fuel, and then 4 for whatever reasons, it changed. So I don't maintain it's a 5 production facility at this point in time. I'm sorry if there 6 was confusion.
7 JUDGE WILBER: Could I go to your example of an ice 8 condenser? You say that was in the notice.
9 MR. McGARRY: It was incorporated by reference in 10 the notice.
11 JUDGE WILBER: If I were to understand your 12 definition of "use," it wouldn't be a use anyway, so why would 13 it be in the notice?
14 MR. McGARRY: That's a good position.
15 JUDGE WILBER: Is this correct using your definition 16 of "use"?
17 MR. McGARRY: I,wasn't thinking eight steps ahead, 18 only seven steps ahead. I would agree with you.
19 I would like to close by drawing the Board's 20 attention to a case we have cited, and that is the Connecticut 21 Fund for the Environment v. EPA. That case was decided by 22 Second Circuit Chief Judge Feinberg, Justices Friendly and 23 Kaufman, not too shabby a panel.
24 Here they were concerned with an issue --
25 JUDGE ROSENTHAL: Are you suggesting there are
168
() 1 shabby panels on the Second Circuit?
. 2 [ Laughter]
3 MR. McGARRY: You know I'm not going to answer that 4 question. I'm certainly not referring to the panel I'm 5 before. You know that, also.
6 This case involved the Connecticut State 7 implementation plan for sulfur dioxide, clearly a matter of 8 concern, SO2 emissions. There,was some question, the Court 9 said, on page 186. "A description of the revision certainly 10 does not make crystal clear that the energy trade program is 11 designed to permit increased sulfur in fuel and consequently 12 increased SO2 emissions. Nevertheless, we are troubled by the i
v/ thought that there may have been citizens and groups who, had 13 14 they not been misled by the notice, would have urged 15 Connecticut to keep its air cleaner than required."
16 And they continue: "But the Fund, which clearly 17 understood what was at stake and participated fully in the 18 State as well as in the Federal proceedings, does not allege 19 that it was prejudiced, nor did it object to the notice at the 20 State level when any defect could easily have been cured.
21 "Moreover, this revision has been through extensive 22 administrative and judicial proceedings and all the issues i 23 have brun thoroughly explored. At this late date, the 24 wastefulness of overturning the approval outweighs the lack of 25 clarity of the notice, especially since it has not prejudiced
169
() I the parties before this Court."
2 JUDGE ROSENTHAL: Thank you, Mr. McGarry.
3 On behalf of the entire Board, I would like to 4 commend counsel for their helpful presentations, and on that 5 note, this issue goes back into the larger collection of 6 issues presented by the various appeals before us which were <
7 heard some time ago.
h (Whereupon, at 11:15 a.m. the hearing was 9 concluded.]
10 11 12 13 14 i 15 16 17 18
'l 19 l 20 21 22 23 i 24 25
O 1 CERTIFICATE OF OFFICIAL REPORTER 2
3 4
5 This is to certify that the attached proceedings 6 before the United States Nuclear Regulatory Commission in the 7 matter of: Duke Power Company, et al. (Catawba Nuclear Station Units 1 and 2) 8 9 Name of Proceeding: Supplemental. Oral Argument 10 11 Docket No.
[
s 1i2 place: Bethesda, Maryland 13 Date: Friday, June 28, 1985 14 15 were held as herein appears and that this is the original 16 transcript thereof for the file of the United States Nuclear l
17 Regulatory Commission.
18 _
'N s
,g (Signature)
(Typed Name of Reporter) g ./ 't Mimie Meldzer g
f} -
20 21 i
22 23 Ann Riley & Associates, Ltd.
24 25
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