ML20138R059
| ML20138R059 | |
| Person / Time | |
|---|---|
| Site: | Harris  |
| Issue date: | 12/23/1985 |
| From: | Hollar D CAROLINA POWER & LIGHT CO. |
| To: | Bright G, Carpenter J, Kelley J Atomic Safety and Licensing Board Panel |
| References | |
| CON-#485-603 OL, NUDOCS 8512300292 | |
| Download: ML20138R059 (7) | |
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Carolina Power & Light Company POST OmCE BOX 1551 COLKETED Raleigh, North Carolina 27602%C IIGAL Duwammr
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'85 DEC 26 All :43 December 23,1985 Telecopier (912) 836-7678 GFFlE ;f ha. ;.
DJCFEilNG & SEiw BRANCH James L. Kelley, Esquire Mr. Glenn O. Bright Chairman Atomic Safety and Licensing Board Atomic Safety and Licensing Board U. S. Nuclear Regulatory Commission U. S. Nuclear Regulatory Commission Washington, D.C. 20555 Washington, D.C. 20555 4
Dr. James H. Carpenter Atomic Safety and Licensing Board U. S. Nuclear Regulatory Commission 1
Washington, D.C. 20555 In the Matter of Carolina Power & Light Company and North Carolina Eastern Municipal Power Agency i
(Shearon Harris Nuclear Power Plant)
Docket No. 50-400 OL Administrative Judges Kelley, Bright and Carpenter:
Enclosed is a copy of Carolina Power & Light Company's Form 8-K which is today being filed with the Securities and Exchange Commission, following a meeting of the Company's Board of Directors on December 18, 1985. Based upon the Company's recent review of the schedule to complete construction of the Harris Plant, paragraph 4 of Form 8-K Indicates that the unit is now expected to be placed in-service in late 1986.
The current target for fuel load is June 1986. Accordingly, expeditious resolution of all remaining issues before the Board is still essential to permit licensing of the plant by June.
Respectfully submitted, h.-
i Dale E. Hollar DEH:ew Associate General Counsel Enclosure ec:
Service List Attached Dr. J. N. Grace Mr. H. L. Thompson, Jr.
Mr. L. S. Rubenstein Mr. T. M. Novak Mr. P. E. Fredrickson Mr. B. C. Buckley Mr. H. R. Denton Mr. G. F. Maxwell gu22888!Bia8lE gb3
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SERVICE LIST H. A. Cole, Jr., Esquire Thomas S. Moore, Esquire Special Deputy Attorney General
-Chairman Antitrust Division Atomic Safety and Licensing Appeal Board 200 New Bern Avenue U. S. Nuclear Regulatory Commission Raleigh, North Carolina 27601 Washington, D. C. 20555 M. Travis Payne, Esquire Dr.' Reginald L. Gotchy Edelstein and Payne Atomic Safety and Licensing Appeal Board Post Office Box 12643 U. S. Nuclear Regulatory Commission Raleigh, North Carolina 27605 Washington, D. C. 20555 Dr. Richard D. Wilson Mr. Howard A. Wilber 729 Hunter Street Atomic Safety and Licensing Appeal Board Apex, North Carolina 27502 U.'S. Nuclear Regulatory Commission Washington, D. C. 20555 Mr. Wells Eddleman 806 Parker Street James L. Kelley, Esquire Durham, North Carolina 27701 Atomic Safety and Licensing Board U. S. Nuclear Regulatory Commission Thomas A. Baxter, Esquire Washington, D. C. 20555 John H. O'Neill, Jr., Esquire Shaw, Pittman, Potts & Trowbridge Mr. Glenn O. Bright 1800 M Street, NW Atomic Safety and Licensing Board Washington, D.C. 20036
~ U. S. Nuclear Regulatory Commission Washington, D. C. 20555 Bradley W. Jones, Esquire U. S. Nuclear Regulatory Commission Dr. James H. Carpenter Region II Atomic Safety and Licensing Board 101 Marietta Street U. S. Nuclear Regulatory Commission Atlanta, Georgia 30303 Washington, D. C. 20555 Robert P. Gruber Charles A. Barth, Esquire Executive Director Myron Karman, Esquire Public Staff
' Office of Executive Legal Director North Carolina Utilities vommission U. S. Nuclear Regulatory Commission Post Office Box 29520 Washington, D. C. 20555 Raleigh, North Carolina 27626-0520 I
~ Docketing and Service Section John Runkle, Esquire Office of the Secretary Conservation Council of North Carolina U. S. Nuclear Regulatory Commission 307 Granville Road Washington, D. C. 20555 Chapel Hill, North Carolina 27514 Mr. Daniel F. Read, President Chapel Hill Anti-Nuclear
' Group Effort Post Office Box 2151 Raleigh,' North Carolina 27602 Dr. Linda Little Governor's Waste Management Board 513 Albemarle Building 325 Salisbury Street Raleigh, North Carolina 27611 d
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FORM 8-K SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 Current Report Pursuant to Section 13 or 15(d) of the Securities Exchange u... s: 1334 Date of Report (Date of earliest event reported) Month of November,1985 CAROLINA POWER & LIGHT COMPANY (Exact name of registrant as specified in its charter)
North Carolina 1-3382 56-0165465 (State or other jurisdiction (Commission (IRS Employer of incorporation)
File Number)
Identification No.)
411 Fayetteville Street, Raleigh, North Carolina 27602 (Address of principal executive offices)
Registrant's telephone number, including area code (919) 836-6111
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Item 5. Other Events 1.
(Reference is made to the Company's 1984 10-K, Construction Program, page 4, paragraph 1.)
The Company's estimates of capital requirements, including anticipated construction expenditures, for the three years 1986 through 1988 are set forth below. These estimated capital requirements are based on the Company's 1986 construction budget which was approved at the December 18,1985 meeting of the Company's Board of Directors.
These estimated capital requirements are subject to continuing review and adjustment.
Estimated Capital Requirements (In Millions) 1986 1987 1988 Total Construction expendMures
$738
$482
$488
$1,708 Nuclear fuel expenditutes 73 72 75 220 Less AFUDC (a)
(153)
(44)
(53)
(250)
Net expenditures (b) 658 510 510 1,678 Harris Units Nos. 2,3, and 4 cancellation costs (c) 30 0
0 30 Long-term debt and preferred stock maturities (d)
_5(e) 132 45 182 Total
$693
$642
$555
$1,890 (a)
As prescribed in regulatory systems of accounts, an allowance for borrowed and other funds used to finance electric utility plant construction less applicable income taxes (AFUDC) is charged to the cost of plant (see Note 1(d) to Financial Statements set forth in Item 8 of the Company's 1984 10-K).
(b)
Reflects reductions of approximately $65 million, $34 million and $41 million for 1986,1987, and 1988, respective 1,, in net capital requirements resulting frcm Power Agency's projected payment of its proportionate share of capital expenditures related to Joint Facilities.
(c)
Reflects the Company's share of costs and charges expected to be incurred in connection with the cancellation of Harris Unit Nos. 2,3, and 4.
(d)
Excludes nuclear fuel continuous funding arrangements.
(e)
In addition to the requirements shown above, the Company presently expects to redeem early $60 million of Guaranteed Notes,16-1/2% Series, due February 15,191s9.
The above table reflects (i) a late 1986 projectad in-service date for Harris Unit No.1, (ii) a 1991 projected in-service date for Mayo Unit No. 2, and (iii) cost estimate revisions completed in December 1985 prepared as a part of the annual construction budgeting process.
2.
(Reference is made to the Company's 198410-K, Construction Program, page 5, j
paragraph 3.) Approximately $627 million is included in the estimated 1986-1988 I
construction expenditures for the Company's share of the estimated costs to complete construction of Harris Unit No. I and Mayo Unit No. 2. These estimated costs reflect (1) the projected in-service dates, (ii) estimated increases in the costs of labor, material and equipment, and (iii) estimated AFUDC adjusted for the inclusion in rate base of all currently allowed Construction Work in Progress (CWIP) and some projected future eligible CWIP for Harris Unit No. I associated with the wholesale jurisdiction. While the Company has assumed the inclusion of such CWIP in rate base in determining the level of its capital requirements, the Company is unable to predict what level of CWIP, if any, in rate base will be allowed by regulatory authorities in the future.
3.
(Reference is made to the Company's 198410-K, Construction Program, page 5, paragraph 4.
Reference is also made to the Company's 8-K dated September 24, 1985, item 5, paragraph 1.) The Company's current construction schedule for new generating units is as follows:
Design Projected Target In-Service Unit Capacity Type Date Estimated Cost (Millions)(a)
(Including gqwer (Exclading wer Agency 1)
Agency C)
Harris No.1 900 MW Nuclear 1996
$ 3,271
$ 2,683 t
Mayo No. 2 720 MW Coal 1991 694 582 i
(a)
Includes AFUDC adjusted with respect to Harris Unit No.1 for the inclusion of all currently allowed CWIP and some projected future eligible CWIP in rate base associated with the wholesale Jurisdiction. Does not include costs of land.
(b)
Does not include reductions as a result of the sale of a 16.17%
undivided ownership intsrest in these facilities to Power Agency.
(c)
Company's portion excluding Power Agency's ownership interest.
4.
(Reference is made to the Company's 198410-K, Construction Program, page 5, paragraph 5.
Reference is also made to the Company's 8-K dated September 24, 1985, Item 5, paragraph 1.) As a part of its annual budgeting process, the Company has recently completed a review of the schedule and estimated cost to complete i
construction of the Harris Plant. As a result of that review, the unit is now expected to be placed in-service in late 1986. Based upon current cost estimates, the gross budgeted cost of the Company's and Power Agency's combined interests in tLe Harris Plant is $3.636 billion. After adjusting for the effect of Construction Work in Progress (CWIP) in rate base, the projected cost of the combined interests is $3.271 billion. The projected cost to~ the Company, after adjusting for CWIP in
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rate base and after subtracting Power Agency's 16.17% ownership interest, is l
$2.683 billion.
These coct estimates assume that the Plant will be placed in commercial service in late 1986 and reflect estimated increases in the cost of labor, material, equipment and estimated AFUDC adjusted for the inclusion of i
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CWIP in rate base. Should factors involving governmental, regulatory, design, procurement, construction, testing, start-up and other uncertainties inherent' in such major projects adversely affect construction, it may be necessary to further revise the projected in-service date and/or increase the estimated cost of Harris Unit No.1.
5.
(Reference is made to the Company's 198410-K, Construction Program, page 6, paragraph 7.)
At November 3% 1985 the Company's investment for its 83.83%
share of units under construction, including AFUDC adjusted for inclusion of CWIP in rate base and including land costs of $29,706,000 for Harris Unit No.1, was (in thousands):
Harris Unit No. 1...................... $ 2,2 7 5,4 4 4 Mayo Unit No. 3.......................
16,517 Total.............................. $ 2,2 91,9 61 6.
(Reference is made to the Company's 1984 10-K, Financing Program, page 7, paragraph 1.) Based on the Company's estimate of capital requirements for 1986-1988, the Company presently estimates that external funds of approximately $425 million, $200 million and $20 million in 1986,1987 and 1988, respectively, will be needed from sales of long-term securities, including sales of common stock under its automatic dividend reinvestment plan, employee stock plans and customer stock ownership plan, and from short-term borrowings. The above estimates have been reduced by $140 million for the 1986-1988 period from what would otherwise be required, reflecting Power Agency's contribution for ongoing construction and nuclear fuel. The remainder of the Company's capital requirements through 1988 are expected to come from internally generated funds. The Company may from time to time sell additional securities beyond what is needed to meet capital requirements to allow the early refunding of existing long-term debt or the reduction of short-term debt. The amounts and timing of the sales of securities will depend upon market conditions and the specific needs of the Company.
7.
(Reference is made generally to the Company's 198410-K, Retail Rate Matters.
Reference is also made to the Company's 8-K dated June 17, 1985, Item 5, i
paragraph 3, to the Company's 8-K dated July 17,1985, Item 5, paragraph 1, to the i
Company's 10-Q for the quarter ended June 30,1985, Item 5, paragraph 1, to the i
Company's 8-K dated September 24, 1985, Item 5, paragraph 4 and to the Company's 8-K dated October 23,1985, item 5, paragraph 4.) On November 18, 1985, the Attorney General of North Carolina and the Public Staff filed Notices of Appul in Docket No. E-2, Sub 503. The Company cannot predict the outcome of this matter.
8.
(Reference is made generally to the Company's 1984 10-R, Retail Rate Matters.
Reference is also made to the Company's 8-K dated October 23,1985, Item 5, paragraph 3.) The North Carolina Utilities Commission (NCUC) has issued its Order in Docket No. E-2, Sub 511 denying the Public Staff's Petition that an audit of constraction costs at the Harris Plant be undertaken by an independent firm j
selected by the NCUC at a cost to be borne by the Company. In its Order, the NCUC asked the Public Staff to undertake an investigation using its available resources. The Company cannot predict the outcome of this matter.
l 9.
(Reference is made to the Company's 1984 10-K, Nuclear Matters, page 22, paragraph 14. Reference is also made to the Company's 10-Q for the quarter ended
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March 31,1985, item 5, paragraph 3, to the Company's 10-Q for the quarter ended June 30,1985, item 5, paragraph 4, to the Company's 8-K dated June 17, 1985, Item 5, paragraph 7, to the Company's 8-K dated July 17,1985, Item 5, paragraph 5 and to the Company's 8-K dated September 24,1985, Item 5, paragraph 5.) On December 11, 1985, the Atomic Safety and Licensing Board (ASLB) ruled in favor of the Company on the remaining safety issues heard by the ASLB in the fall of 1984 and on the two emergency planning contentions heard in June 1985. Hearings on the drug use contention were held in September, October and November 1985.
Proposed findings will have been filed by all parties by January 2,1986. Hearings on one emergency planning issue (nighttime notification of the public) were held in November 1985.
The schedule requires all proposed findings to be filed by December 30,1985. After the completion of these hearings, the members of the ASLB sent a letter to the NRC Commissioners suggesting that the nighttime i
notification issue may present a generic safety issue for other nuclear plants. The Company, the NRC Staff, and the Federal Emergency Management Agency have sent responsive letters to the Commissioners explaining why they do not believe that a generic safety issue exists. The Attorney General of North Carolina has filed a petition to intervene on the nighttime notification issue; the ASLB has 1
granted the unopposed petition. On November 5,1985, the ASLB admitted two new contentions arising from the emergency planning exercise held last May. These new contentions are currently in discovery. The ASLB has also asked the parties to address a motion to reconsider one emergency planning contention in light of the decision in NRC v. GUARD, 753 F. 2d 1144 (D. C. Cir.1983), and the NRC's 4
subsequent Interim Guidance related to that case. The ASLB has indicated that it expects to decide all remaining issues in this proceeding by the end of February 1986. The Company cannot predict the outcome of these matters.
SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
CAROLINA POWER & LIGHT COMPANY Registrant i
i By:
/s/ F1 ward G. Lilly, Jr.
Edward G. Lilly, Jr.
Executive Vice President Date: December 18,1985 4
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