ML20137U381

Safety Evaluation Approving Transfer of Operating Authority to New Operating Company

ML20137U381
Person / Time
Site:	South Texas
Issue date:	04/08/1997
From:	NRC (Affiliation Not Assigned)
To:
Shared Package
ML20137U333	List: ML20137U329 ML20137U353 ML20137U381
References
NUDOCS 9704160374
Download: ML20137U381 (5)

Text

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SAFETY EVALUATION BY THE OFFICE OF NUCLEAR REACTOR REGULATION

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PROPOSED TRANSFER OF AUTHORITY TO NEW OPERATING COMPANY FACILITY OPERATING LICENSES NOS. NPF-76 AND NPF-80 HOUSTON LIGHTING & POWER COMPANY CITY PUBLIC SERVICE BOARD OF SAN ANTONIO CENTRAL POWER AND LIGHT COMPANY CITY OF AUSTIN. TEXAS DOCKET NOS. 50-498 AND 50-499 j SOUTH TEXAS PROJECT. UNITS 1 AND 2 4

1.0 INTRODUCTION

By letter dated August 23, 1996, as supplemented by letters dated October 1  ;

and 15, 1996, and January 28, 1997, Houston Lighting and Power Company (HL&P '

or licensee), on behalf of itself and the other three owners of the South Texas Project, Units 1 and 2 (STP), City Public Service Board of San Antonio, Central Power and Light Company, and City of Austin, Texas (owners), requested approval of the transfer of operating authority under Facility Operating Licenses Nos. NPF-76 and NPF-80 for STP to a new operating company and .

issuance of conforming amendments, pursuant to 10 CFR 50.80 and 50.90. The i proposed transfer of operating authority under the licenses would allow a new operating company to use and operate STP and to possess and use related licensed nuclear materials in accordance with the same conditions and authorizations included in the current operating licenses. The proposed license amendments would reflect the transfer of operating authority. This Safety Evaluation is in regard to the proposed transfer.

2.0 BACKGROUND

The licensee states that the new operating company would be formed by the owners to become the licensed operator for STP and would have exclusive control over the operation and maintenance of the facility. The present plant organization, the oversight organizations, and the engineering and support organizations would be transferred essentially intact from HL&P, which is now responsible for operating and maintaining the facility, to the new operating company. The technical qualifications of the new nperating company organization, therefore, would be at least equivalent to those of the existing organization.

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i l The licensee also states that under the proposed arrangement, ownership of STP i would remain unchanged, with each owner retaining its current ownership

interest. The new operating company would not own any portion of STP.

l Likewise, the owners' entitlement to capacity and energy from STP wculd not be

affected by the proposed change in operating responsibility for STP from HL&P i to the new operating company. The owners would continue to provide all funds

{ for operation, maintenance, and decomissioning by the operating company of

STP. The responsibility of the owners would include funding for any emergency j situations that might arise at STP.

Pursuant to 10 CFR 50.80, .no license for a production or utilization facility,

or any right thereunder, shall be transferred, assigned, or in any manner

j. disposed of either voluntarily or involuntarily, directly or indirectly,

. through transfer of control of the license to any person, unless the j Comission gives its consent in writing. The Comission may approve the j transfer of control of a license, after notice to interested persons i (November 7, 1996 (61 FR 57719)). Such action is contingent upon the Comission's determination that the proposed transferee is qualified to hold

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the license and the transfer of the license is otherwise consistent with the applicable provisions of law, regulations, and orders of the Comission.

3.0 ANTITRUST CONSIDERATIONS In its application submitted August 23, 1996, the licensee stated that the plan for the new operating company to operate STP would not impact the existing ownership of STP or the existing ownership of, or entitlement to, power from the facility. The new operating company is to be solely dedicated to the operation of STP and will not be involved in the marketing or brokering cf power from the facility. The licensee further stated that the designation of the new operating company as the entity authorized to use and operate STP would not alter the existing antitrust license conditions, which would remain applicable to all the owners. The licensee concluded that the requested changes would have no impact on the local market for electricity and would raise no antitrust issues affecting that market.

The licensee's application proposes a license condition for each STP unit prohibiting the new non-owner operator from engaging in marketing or brokering power or energy from the facility and holding the existing owners responsible and accountable for the actions of the operator.

In consideration of the foregoing, and with the imposition of the above condition, the proposed transfer of operating authority raises no issue with respect to antitrust considerations. The staff has determined, therefore, that no further antitrust review is required.

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4.0 MANAGEMENT OF UTILITY OPERATION AND TECHNICAL QUALIFICATIONS In its application, the licensee states that the new operating company wot1d assume responsibility for, and control over, operation and maintenance of the facility. The current plant organization, the oversight organizations, and the engineering and support organizations would be transferred essentially intact from HL&P to the new operating company. The technical qualifications of the proposed operating organization, therefore, would be at least equivalent to those of the existing organization.

The licensee also states that a central objective in planning the proposed transfer of employees and operating responsibilities from HL&P to the new operating company has been to ensure that there is no disruption to the

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, operation of the plant and to respect the-integrity of the existing, successful organization. According to the licensee, the new operating company will operate, manage, and maintain STP in accordance with the conditions and i requirements established by the NRC, with the same regard for public and l personal safety heretofore exemplified by HL&P. The nuclear organization of L STP will be preserved in the proposed operating company organization, with the l only change being that the senior nuclear executive will report directly to the Board of Directors of the operating company rather than to the President l and Chief Operating Officer of HL&P. Thus, the current HL&P Executive Vice President and General Manager, Nuclear, of STP will become the President and Chief Executive Officer of the new operating company and will continue to be the officer at the site responsible for the overall safe operation and maintenance of STP.

Based upon the continuity of management and technical qualifications described above, the staff finds that the proposed operating company will be technically qualified to operate STP and that management of the facility will continue to be adequate.

5.0 FOREIGN OWNERSH11 CONTROL. OR DOMINATION The new operating company will be owned only by Houston Lighting and Power Company, City Public Service Board of San Antonio, Central Power and Light Company, and City of Austin, Texas. Currently, the staff has no reason to believe that any of these entities is owned, controlled, or dominated by any alien, foreign corporation, or foreign government, or that the proposed new operating company will otherwise be owned, controlled, or dominated by any alien, foreign corporation, or foreign government.

6.0 FINANCIAL QUALIFICATIONS ANALYSIS

Financial responsibilities under the licenses are not being transferred to the new cperating company. Thus, a financial qualifications analysis with respect I to the proposed transferee is not required. Moreover, based on the informa-tion provided in the licensee's application, the staff finds that there will l be no near-term substantive change in the owners' financial ability to contribute appropriately to the operations and decommissioning of the STP

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units as a result of the proposed formation of the new operating company. l Each of the owners would remain an " electric utility" as defined in 10 CFR l 50.2, engaged in the generation, transmission, and distribution of electric l energy for wholesale and retail sale, subject to the rate regulation of the '

Texas Public Utility Commission. Thus, pursuant to 10 CFR 50.33(f), the owners are exempt from further financial qualifications review as electric utilities.

Because the application requests only that the new operating company be added to the STP licenses, and the current owners will remain on the STP licenses and will continue to be financially responsible for the safe operation and decommissioning of the STP units, the staff believes that with respect to the issue of financial qualifications, the licensee's application should be approved.

7.0 ENVIRONMENTAL CONSIDERATION

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Pursuant to 10 CFR 51.21 and 51.35, an environmental assessment and finding of no significant impact was published in the Federal Reaister on November 18, 1996 (61 FR 58710).

8.0 CONCLUSION

Based on the above determinations, the staff concludes that the proposed new operating company is qualified to hold the licenses to the extent and for the purposes proposed by the application for approval of the transfer of operating authority, and that the transfer is otherwise consistent with the applicable provisions of law, regulations, and orders issued by the Commission pursuant thereto.

Principal Contributors: M. Davis R. Wood T. Alexion Date: April 8.1997

DISTRIBUTION:

> t- I Docket Fili

[i PDIV-1 r/f f; CHanes TAlexion 1

April 8, 1997 1

J MEMORANDUM TO: Rules Review and Directives Branch Division of Freedom of information and Publications Services

, Office of Administration

FROM

Office of Nuclear Reactor Regulation

SUBJECT:

Il00STON LIGHTING AND POWER C0!iPAllY - SOUTil TEXAS PROJECT One signed original of the FederalRegister Notice identified below is attached for your transmittal to the Office of the Federal Register for publication. Additional conformed copies ( ) of the

, Notice are enclosed for your use.

f Notice of Receipt of Application for Construction Permit (s) and Operating License (s).

Notice of Receipt of Partial Application for Construction Permit (s) and Facility License (s):

Time for submission of Views on Antitrust matters.

Notice of Consideration of Issuance of Amendment to Facility Operating Ucense. (Call with 30-day insert date).

Notice of Receipt of Application for Facility License (s); Notice of Availability of Applicant's Environmental Report; and Notice of Consideration of Issuance of Facility License (s) and Notice

.l of Opportunity for Hearino.

3 Notice of Availability of NRC Draft / Final Environmental Statement.

Notice of Limited Work Authorization.

Notice of Availability of Safety Evaluation Report.

Notice of issuance of Construction Permit (s).

C Notice of issuance of Facility Operating License (s) or Amendment (s).

Order.

Exemption.

Notice of Granting Exemption.

Environmental Assessment.

Notice of Preparation of Environmental Assessment.

Receipt of Petition for Director's Decision Under 10 CFR 2.206.

Issuance of Final Director's Decision Under 10 CFR 2.206.

Other:

DOCKET NOs 50L-493 and 50-499 Attachment (s): As stated

Contact:

T. Alexion Telephone: 415-1326 DOCUMENT NAME: STP96411.02D Ta receive a copy of thle doeurnent, Indicate in the box: "C" = Copy without ettechment/ enclosure *E" = Copy with attachment /encloeure 'N' = No copy OFFICE LA/PD41 I I l l l l l NAME CHawes(J#//

DATE- 4 //5/97 OFFICIAL RECORD COPY

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