ML20155C698

Responds to Recent Ltr to Senator Connors Re Possible Closure of Oyster Creek Nuclear Generating Station & Possible Impact That Closure May Have on Economy & Environ of Community

ML20155C698
Person / Time
Site:	Oyster Creek
Issue date:	10/29/1998
From:	Thomas C NRC (Affiliation Not Assigned)
To:	Engelken M AFFILIATION NOT ASSIGNED
Shared Package
ML20155C628	List: ML20155C624 ML20155C648 ML20155C666 ML20155C672 ML20155C684 ML20155C688 ML20155C698 ML20155C702 ML20155C705 ML20155C709 ML20155C720 ML20155C725 ML20155C730 ML20155C737 ML20155C748
References
NUDOCS 9811020319
Download: ML20155C698 (1)

Text

__ . _ _ . _ _ _ . . _ _ . _ _ . _ _ _ _ _ _ . _ _ . . _ _ . _ _ _ _ _ _ _ _ _ _ _ . _ _ _ _ .

Ms. Mary Engilksn October 29, 1998

, 33 Desr Run Drive Sou")

B1magat, NJ 08005

Dear Ms. Engelken:

I have been asked to respond to your recent letter to Senator Connors regarding the possible closure of Oyster Creek Nuclear Generating Station (OCNGS) and the possible impact that closure may have on the enonomy and the environment of the community.

Primarily because of the established economic regulatory process, the U.S. Nuclear Regulatory Commission (NRC) has exercised limited financial oversight of electric utility licensees. The electric industry's move away from traditional rate-based regulation toward increased competition in a deregulated marketplace could have an adverse impact on the long-term ability of utilities to adequately finance safe operation and decommissioning of their nuclear power plants.

Although the NRC is not usually involved in economic or rate regulation, over the years the agency has recognized a possible relationship between adequate financing and safe operations.

Licensees' efforts to reduce spending could result in smaller, less-experienced workforces; reductions in maintenance and capital budgets; shorter refueling outages, during which certain maintenance is performed; and a decline in training resources. The NRC must ensure that economic pressures do not result in reduced safety margins at operating nuclear plants and do not impair a licensee's ability to fully finance decommissioning at a plant after it is shut down.

It also should be noted that the staff has historically not found a strong correlation between levels of operation and maintenance (O&M) and capital additions expenditure and measures of safety performance. Many plants have increased capacity factors and reduced O&M costs and continue to demonstrate excellent safety performance. The NRC will continue to monitor OCNGS through the inspection process and other plant performance indicators used to assess safe plant operation.

With respect to some other issues you raised, and as indicated by your 9th District representatives in a letter to you dated September 22,1998, there is considerable activity at the State level to develop long-term strategies to address the socioeconomic and environmental issues surrounding the OCNGS facility.

I hope this letter is responsive to your concems regarding the safe operation of OCNGS until a final decision is made regarding the future operation of the facility.

Sincerely, Original signed by Cecil O. Thomas, Director Project Directorate 1-3 Division of Reactor Projects - t/II Office of Nuclear Reactor Regulation DOCUMENT NAME: G:\EATON\g980614.mee To receive a copy of this document, indicate in the box: "C" - Copy without attachment / enclosure "E" - Copy with attachment / enclosure "N" - No copy l' PDlj7/D # l 0FFICE PDI 3/PI(tl/ l PDI-3/LA ,J/ l DRPE/D(A) Y l NAME REator4 ' / TClark ' /N

• Cfhgsd( b JZwotinsk F lDATE Id / M /98 ic / 4< /98 & /2K /98 W/V /98 0FFICIAL RECORD COPf 9811020319 981029 PDR ADOCK 05000219 H PDR 411@.v ~

MQ

- ,_