ML20205R492
| ML20205R492 | |
| Person / Time | |
|---|---|
| Site: | Seabrook  |
| Issue date: | 11/01/1988 |
| From: | Strauss P MASSACHUSETTS, COMMONWEALTH OF, MHB TECHNICAL ASSOCIATES |
| To: | |
| Shared Package | |
| ML20205R446 | List: |
| References | |
| CLI-88-07, CLI-88-7, OL-1, NUDOCS 8811100049 | |
| Download: ML20205R492 (20) | |
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Q AFFIDAVIT OF PETER M.
STRAUSS 1.
My name is Peter M. Strauss.
I am an Associate of MHB Technical Associates (MHB), a technical consulting firm i
specializing in nuclear power plant safety, licensing, and regulatory matters, located at 1723 Hamilton Avenue, Suite K, San Jose, California 95125.
I received a Bachelor of Arts Degree in History from the University of Wisconsin in 1970 and a Master of Science Degree in Managerial Science and Policy from the College of Environmental Science and Policy, State University of New York in 1977.
Since 1977 I have specialized in energy and environmental issues, nine years as a management and technical consultant, and two years as a Senior Environmental Engineer for a large mining company (Utah 7nternational, Inc.).
I Since joining MHB in 1986, I have provided consulting services regarding the construction, operation and decommissioning of nuclear power plants for governmental agencies in New Jersey, Pennsylvania, Minnesota, Ohio, Texas, Massachusetts, Illinois and the City of El Paso.
I have evaluated the decommissioning cost estimates of approximately twenty nuclear power stations, and have assisted in the i
preparation of testimony and/or reports involving Hope Creek, Palo Verde, Prairie Inland and Monticello.
I have also reviewed the methodologies for preparing decommissioning cost estimates for nuclear power stations developed by the Atomic Industrial l
Forum (AIF), the U.S.
Department of Energy (DOE) ar.d Battelle i
Northwkst Laboratory, which formed the basis for the Nuclear l
Regulatory Commission's cost estimate.
I have testified before the New Jersey Board of Public Utilities and the Illinois Commerce Commission.
While at MHB, I have also provided a t
technical review on DOE's Environmental Assessment on 8811100049 80110D 1
PDR ADOCK 05000443 G
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Transporting Foreign Spent Fuel to the U.S.
for reprocessing at Savannah River.
Prior to joining MHB, I headed my own consulting firm, founded in 1984, P. M. Strauss and Associates, specializing in energy and environmental issues.
In this capacity, I assisted small power producers in California in obtaining permits, negotiating contracts and represented them in regulatory proceedings.
For other clients I assistou in developing hazardous waste programs and environmeiital compliance programs.
In 1981-1983, I worked as a senior environmental engineer with Utah International, Inc., an international mining corporation.
In this capacity I analyzed the effects of proposed environmental regulations on the Company and helped it be more responsive to environmental regulations.
I was a member of the National Coal Ascociation/Anerican Mining Congress (AMC) Joint Committee on Surface Mining Regulations and a member of AMC's Aa Hoc Committee on Superfund and Resource Conservation and Recovery Act (RCRA).
During 1980 and 1981 I consulted independently to several state governments en hazardous waste.
Assignments included drafting regulations for New Hampshire and advising Massachusetts on policy options regarding financial assurances for permitting hazardous waste facilities.
I also consulted to an underwriter of environmental impairment liability insurance.
From May 1977 through April 1980, I was employed as a consultant with Resource planning Associates, Inc. (RPA),
specializing in energy and environmental policy and technology.
In this capacity I worked on projects involving uranium mining, nuclear waste, spent-fuel storage aad the economic effects of a moratorium on nuclear power plant orders, other assignments involved advanced electric generating technology and pollution control.
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Further details of my experience and training are included in my Statement of Professional Qualifications, appended a.c.
2.
My direct experience with the Seabrook plant began in 1986.
I assisted in preparing the prudence audit regarding Montaup Electric's investment in Seabrook Unit 2.
In 1987, I investigated financial difficulties regarding the construction of Seabrook Unit 1 for the Vermont Attorney General.
3.
The purpoco of this affidavit is to explain the technical reasons why The Plan In Resoonse to NRC Order CLI 21 ("Plan") prepared by New Hampshire Yankee in October 1988 is inadequate for estimating the decommissioning costs for Seabrook, should the pit't operate at low power for a short time and thereafter be removed from service.
4.
There are five major reasons why the Plan is inadequate:
it lacks documentation and cl< tar assumptions regarding the cost of low level waste disposalt it is based on an j
unrealistic assumption that irradiated spent fuel will be shipped overseas to a foreign reprocessing facility; it fails to consider that foreign reprocessing of U.S.
commercial reactor fuel is not covered by any generic or site-specific environmental docomentation in compliance with NEPA; it has a low contingency factor; and, it does not provide sufficient documentation to compare it with other cost estimates.
5.
Low level waste disposal is a major cost element in decommissioning.
In other recent estimates, disposa3 accounts for 10-15% of the costs of decommissioning.
Rates for disposal have 'ncreased by approximately twenty-five (25) percent per annum over tha last five years.
The Plan does not designate where NHY intends to dispose of its wastes, and does not provide assumptions regarding burial rates and escalation rates.
Therefore, I cannot discern if the cost estimate is reasonable.
6.
The Plan assumes that after 20 months, the irradiated spent fuel will be shipped abroad for reprocessing, presumably in 3
the United Kingdom or France.
This would be unprecedented in U.S. commercial nuclear reactor experience.
Because spent fuel contains weapons grade source material, shipping it abroad would be a departure from a U.S. policy begun in 1975 by President Ford.
It is also unlikely that NHY would be able to physically move the fuel in the time it has indicated.
Moving irradiated fuel in casks to a harbor, loading it aboard ship, transportiag and off loading would involve substantial logistical and harbor support, complex regulatory and state department approvals, and require that seaworthy shipping casks be available.
Products from reprocessing would be in the form of high level liquid or solid waste, plutonium and uranium.
Reportedly, reprocessing contracts negotiated with BNFL or Cogema currently involve return of these wastes to their place of origin in whatever form the reprocessor chooses.
This would raise acute diplomatic, policy, and regulatcry problems.
If the products were going to be returned to NHY, it would not be able to store or use these products.
Therefore, for all the reasons stated above, I believe that this option (i.e.,
foreign reprocessing) is unrealistic s.a should not be used as a basis for establishing how long decommissioning will take.
Without this unrealistic assumption, NHY must establish a plan where it could fully decommission the plant, including the spent-fuel pool, so that it can terminate its license.
Additionally, NHY should provide a basis for e
estimating the costs of maintaining the spent fuel on site until a realistic option is available.
7.
Transporting spent fuel to a foreign reprocessing facility would require compliance with NEPA.
The EIA process could take several years and should be completed before a decision on financial qualifications is made.
Authorization to export spent fuel for reprocessing would be a major federal action having potential significant affects on the environment both in the U.S. and in the importing country.
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This would require an Environmental Impact Statement (EIS) under Section 102(2)C of the National Environmental Policy Act of 1969.
Shipping spent fuel to a foreign reprocessing plant is not enveloped in the Generic EIS (NUREG-0586, 1979) and site-specific harbor impacts and impacts of waste products on environment in foreign country, or impacts of storage in U.S.
8.
The Plan does not provide a basis for its contingency fund, which is $1,361 million or approximately 7% of the cost of decommissioning.
AIF, DOE, Battelle and most other utilities use a 25% contingency factor for estimating costs of decommissioning.
Given the large amount of uncertainty regarding low level waste disposal and the duration of decommissioning process, 7% is unreasonable.
Contingency is defined by the American Association of Cost Engineers as the provision for unforeseeable elements of cost within the define project scope.
It is an allowance for costs that may occur, but are not included in the estimate.
There is no agreed upon definition of contingency that specifies all items that should be included.
It is clear, however, that there is a large amount of unforeseeable elements in the Plan.
In addition, the treatment of contingency in this proceeding is not easily separated from traditional ratemaking forums.
Where ratemaking bodies have reduced the contingency factor to less than 25 percent, they have done so because they would be able to revisit the issue periodically.
Under the hypothetical situation addressed by the Plan, there would be no opportunity to do so.
9.
The Plan does not provide sufficient documentation to enable us to determine the reasons why the estimate is so much lower than contemporaneous estimates at other plants, or to readily differentiate this cost estimate from the estimate after full term operation, costing over $200 million.
It also is relevant to consider that Shoreham has neycr exceeded 5 percent power and is planning to decommission, (similar to the 5
hypothetical situation) but Long Island Lighting Company (LILCo) recently estimated decommissioning costs on the order of $300-
$400 million.
Although I don't have specific details regarding the Shoreham estimate, it is my opinion that the decommissioning of either plant (i.e., Shoreham or Seabrook) would have similar Costs.
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, PETER M.
STRAUSS Subscribed and sworn to before I
ne this Mt day of Nnvoor 1988.
CatherineCitrigno-Norris/[hhamb
,,7. jg. 2/c 4,Q NOTARY PUBLIC
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My commission expires: 11-10-03 4
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ATTACID1ENT 1 PROFESSIONAL OUALIF1 CATIONS OF PETER 51. STRAl'SS PETER Nf. STRAUSS hlHB Technical Associates 1723 llamilton Avenue Suite K San Jose, California 95125 (408) 266-2716 EXPERIENCE:
1986 PRESENT Associate 51HB Technical Associates. San Jose. California Consulting firm specializing in technical, economic and management evaluations of energy prodaction facilities and ensironmental management practices. hfHB works extensively in regulatcry and legal proceedings, prosiding litigation support sersices and expert witness testimony. Areas of corporate specialty include nuclear power plant construction, revenue requirements, nuclear safety and risk assessment, and emironmental and hazardous waste management. Assist in all phases of consulting work from conducting research, preparing reports, and developing testimony and prosiding litigation support. Recent work includes nuclear decommissioning cost evaluations and emironmental and hazardous waste management.
1984 1986 Consultant. P. 51. Strauss and Associates. San Francisco. California Founder of consulting firm specializing in energy and emironment with emphasis on prosiding regulatc< assistance. Assisted small gwer producers evaluate project feasibility, obtain pennits, and representation in regulatory proceedings. Assisted industrial clients to understand applicable emironmental regulations and to determine the existence and extent of toxic l
contamination on their sites. Prepared hazardous waste management plans and emironmental l
compliance plans for industrial clients and government agencie:..
1981 1983 Senior Emironmental Encineer/ Policy A nalyst. Utah International Inc. San Francisco.
Cahfernia hfultinational corporation with worldwide mining and marketing actisities. blanaged the legislative, regulatory, and policy program for Corporate Emironmental Quality Dept.rtment.
Kept senior management apprised of the effects of changing policies and adsised operating disisions how to work with gosernment agencies. Represented corporation in regulatory proceed 4ags. Issues included acid rain, surface mining, hazardous waste frorn mining, and international emironmental practices. Served as a member of the American hfining Congress' 1
Task Force on Superfund and RCRA and the National Coal Association /American hiining Congress Joint Committee on the Surface hiining Control and Reclamadon Act.
1980 1981 Idependent Niansrement Consultant. Washmgton. D.C.
Specialized in energy and emironmental esues. Extensive crperience in hazardous waste management and embonmental risk assessment.
Consulting services for several state commissions on hazardous waste, state departments of emitonmental quality, and a major underwriter of emironmental pollution insurance. Drafted New flampshire's Hazardous Waste Regulations and coaducted public presentations in hiassachusetts on policy options for regulating hazardous waste. Also consulted to U.S. DGE on air pollution control technology and private btainoss on international markets for petrochemicals.
1977 1980 Associate. Resource Phnnine Associates. Inc.. Washincton. D C.
hianagement consulting firm specializing in scarce resource issues. Co-directed several studies invohing er.ergy policy, nuclear development and facility siting, and embonmental management.
Projects included developing a community development strategy for a proposed mining venture, condtxting a feasibility study of oil shale development, assessirg the emironmental impacis on U.S. acquisition of away from reactor storage facilities, developing siting strategies for large.
scale solar applications, developing the federal Stand.By Energy Emergency Conservation Plan, and assessing the potential emvonmental effects of advanced energy technologies (e.g., fuel cells, heat recovery system, fluidized bed combustion).
1976 Teachina Assistant. State University of New York. Collere of Emnonmental Science and Forestry. Swacuse. New York.
Emironmental Law.
1974 1975 County Acent. Berkshire County Extension Senice. Pittsfield. htassachusetts Prosided technical and educational assistance to citizens and community organizations.
Organized community garden programs in the county and assisted communities in developing ton plans.
1971 1973 l
Icacher and Co. Director. Huxlev Hich School. Stockbridee. Niassachusetts Taught basic curriculum its small private school in blassachusetts. Named Co Director of scbool in 1972.
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EDUCATION:
B.A. in History, University of Wisconsin, Madison,1970.
M.S. in Managerial Science and Policy, State Unisersity of New York, College of Ensitor. mental Science and Forestry, S)Tacuse, New York,1977. Master thesis: The Resco.3e to the National Ensironmental Policy Act of 1%9 PUf3LICATIONS:
1.
Environmental Deve! cement Plan: Conservation. Research. and Technoleev, with Resource Planning Associates (RPA), for Energy Research and Development Administration,1977 2.
Institutional Arelications for Solar Enstgy, with RPA, for Department of Energy,1977.
3.
Ensironmental Develocment Plan: Fossil Fuel Utilization. with RPA, for Department of Energy,1978.
4 Analysis of Somersille/Marblehead Source.Seearation Demonstration Procram. (Waste Composih 3n. Enerev Balance. Monitorine Proeressi, with RPA, for tne Ensironmental Protectic,. Ageney (EPA), 1978 1979.
5.
Community Develorment Strateev for New Mexican Uranium Venture. with fsPA, for Mobil Oil Corporation,1978. (confidential) 6.
Production Forecast for Shale Oil: lo*C.NYC. with RPA, for Morgan.Newman, Inc.,1979.
7.
Economie and Stratecie Effects of Moratorium on Nuclear Power Plant Construction. with RPA, for U.S. Department of Energy,1979.
8.
EgyironmentalImract Assessment: Derirtment of Enercy Aeauisitiert pf Existine Away.From.
Reactor Storace Facilities. with RPA, Bechtel, Generd Elcetrie, and Allied, for U.S.
Department of Energy,1979.
9 Evaluation of Cornervation Ontions for Colorado. with RPA, for Colorado Ene*gy Research Institute,1979.
10.
Glouster County Source Seearation Feisibility Study. with RPA, for Glouster County, NJ.
Planning Boatd,1979, 11.
World Oil Monitor (MonthM. with RPA, for Morgan.Newman, Inc., 19791950. (confidential) 12.
Consecuences of Recent Events on World Oil Market. with RPA, for Morgan.Newman,199.
(confidential) 13.
Draft: Standbv Enerev Emercency Conservation Plan, with RPA and MIT, for the Department of Energy,1980.
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Anahsis of Huardous Waste Recula!crv Issues. P. Strauss, TRC, and WRA, under contract to Gordian Associates, for hiassachusetts Department of Emironmental Quality Engineering (D EQE),1980.
15.
Advanced Pollution Control Technoloev The Role of the Denartment of Enerev (DOEL A.
Collins and P. Strauss, with RPA, for the U.S. Department of Energy,1980.
16.
Draft: New Hamoshire Hazardous Waste Reculations. P. Strauss, under contract to Gordian Associates, for New Hampshire Bureau of Solid Waste hianagement (BSWM),1980.
17.
Draft: Connecticut Harardous Waste Reculations, TRC and P. Strauss, under contract to Gordian Associates, for the Connecticut Department of Emironmental Prctection,1980.
18.
Technical Anoendices: Hazardous Waste Information Manul, P. Strauss and Waste Resources Associates, for Massachusetts DEQE,1980.
19.
Draft: Solid Waste Reculations, P. Strauss, under contract to Gordian Associates, for New Hampshire BSWM,1981.
20.
Identification and Evaluation of Ontional ADP Sntems for Trackine Harardous Waste. P.
Strauss and J. Matoba, under contract to Gordian Associates, for New Hampshire BSWM,1981.
21.
For Fayette Manufacturing Corporation, conducted Cross Eumination before California Public Utilities Commission: OIR 2: Phase 1 (1.ong Run Avoided Costs),1984.
22.
Site Investication Recort. P. Strauss and W. Henry, for Trinity Development,1985. (contains confidential information) 23.
Emironmental comoliance Plan P. Strauss under contract to Aqua Resources, Inc., for Brobeck, Phleger & Harrison, Attorney's at 1.aw,19% (contains conSdentialinformation) 24 Huardous Waste Manscement Phn: Moffett Field. P. Strauss with Aqua Resources and ERM.
West, for Department of the Nasy,1985, 25.
Direct Testimony of Dale G. Bridenbaugh and Peter M. Strauss on behalf of New Jersey Department of the Public Advocate, Disision of Rate Counsel, regarding Public Senice Electric and Gas' Base Rate Case: In Senice Criteria for Hope Creek, Hope Creek O&M and Decommissioning Costs, and Operating Plant O&M Costs, May 19,19%
26.
Technical Resiew The U.S. Department of Energy's Emironmental Assessment Concerning Transporting Research Reactor Spent Nuclear Fuel from Taiwan through Portsmouth, VA for Reprocessing at the Savannah River Plant, March,1987.
27 Assisted in preparation of Direct Testimony by Dale G. Bridenbaugh:
On behalf of New Jersey Department c,r Public Advocate, Disision of Rate Counsel, regarding Atlantic City Electric Corporation's Request for Rate Increase regarding Hope Creek In Senice Criteria, O&M and Decommissioning Costs, May 10S6; On behalf of Teus Office of Public Utility Counsel regarding Esaluation of Costs of Riser Bend Nuclear Generating Station, February 1957; 4-l l
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On behalf of City of El Paso, Texas regarding El Paso Electric's Request for Rate increase invohing Palo Verde O&ht Costs, Decommissioning Costs and the Appropriateness of Applying Performance Standards, July 1987; On behalf of the Pennsylvania Office of Consumer Advocate regarding Duquesne Light Corporation's request for Rate Increase invohing Costs of Perry Nuclear Power Plant October 1987; On behalf of the hiinnesota Department of Public Senice regarding Northern Sta'es Power's Decommissioning Cost Estimates for Stonticello and Prairic Island Nuclear Power Plants.
28.
Assisted in preparation of Direct Testimony by Dale G. Bridenbaugh and Richard liubbard on Behalf of Pennsylvania Office of Consumer Advocate r:garding Evaluation of Costs Associated with Construction of Perry Nuclear Power Plant, September 19S6.
29.
Assuted in preparation of Direct Testimony of Gregory hiinor on behalf of hf assachusetts Attorney General regarding the Prudence of htontaup Electric's investment in Seabrook Unit 2, 1956.
30.
Evaluation of Northern States Power's Decommissionine Cost Estimates for Monticello and Prairie 1 land Nuclear Generatine Units. with StHB, for hiinnesota Department of Public Senice, January 1988.
31.
Potential Sources of Totic hietals from San Onofre Units 2 and 3. P. Strauss and D.
Bridenbaugh, for the Starine Resiew Commission, July 1987.
32.
State of IlEncis before the Illinois Commerce Commission, Dircet Testimony of Richard B.
Ilubbard and Peter St. Strauss on behalf of State of Illinois Office of The Attorney General and Office of Public Counsel, Evaluation of Clinton Costs (Phase II), Docket No. 84-0055, July 31, 1988.
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ATTACHMENT 3 i
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AFFIDAVIT OF JOEL ROSENTHAL
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AFF.* DAVIT OF JOEh ROSENTHAL 1.
My name is Joel Rosenthal.
I an a pattner in the law tien of Shapiro, Israel, & Weiner, PC located in Boston, Massachusett.a.
My field of practice for the past twenty years has been bankruptcy law.
2 I have been retained as a Special Assistant Attorney General by the Massachusetts Department of the Attorney General
(* Massachusetts Attorney General') to provide advise on various bankruptcy matters.
3.
I have been asked by the Massachusetts Attorney Genera) to Otste my opinion ao a prootitioner of bankruptcy 1su on tuo questions:
A, whether, on the basis of my review of the
- Reasonable Assurance
- portions of the filing by the Joint Applicants in response to CL1-88-07 (pp. 7-10), which is attached hereto ec Exhibit B, and familiarity with the ongoing proceeding in the Bankruptcy Court in New Hampshire involving Public Ser ' ice Company of New Hampshire ('p3NH'), prior approval by that court would be required before PSNH could pay its monies or cause its monies to be paid into the ' separate and cegrogated 'Dro operation Dcoommiccioning AccoJnt" dC00ribod in the Joint Applicants' filing in response to CL!-98-07:
b.
Whether, on the basis of my review of the Boston Globe article attached heroto as Ixhibit C and familiarity with the engoing proceeding in the Bankruptcy Court in New Hampahire involving DSNH, prior approval by th4P con"r Would be reqaired before PSNH could enter into the agreement with MW4EC and other joint owners of the Seabrook Nuclear Power Station described in the Boston Globe article.
4.
I should state at the outset, that I am not ar. expert in the fields of nuclear power or nuclear power regulation.
The declatativne that I make herein arv, except as stated othvtwise, based solely on my review of the above referenced documents as well as.y knowledge of bankruptcy law and practice and familiarity with the above referenced procesiings in the New Hanpthire Bankruptcy Court.
5 It it my opinion that prior approval by the Bankruptcy Court would be required before PSNH could pay its monies or cause its nonies to be paid inte the ' separate and segregated ' Pre-operation Decommissioning Account" described in the Joint App:; cants' filing.
Such an action would, in my opinion, be viewed as oeing outside the ordinary course of PSNN's business.
j I have buen infotned that the Seabrcok Nuclear Powet Station la first and only nuclear power facility that PSNu has taken a lead role in the constructing and/or operating.
This circumstance, togethur with the factual accertion in tho abvVc ref renced i
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i Massachusette Att.orney General's Petition, leads f:e to conclude I
that paynerit of invriisa to provide fut decommissioning after low power operation of tav Seabrook Nuclear Power Station would be a unique and financially significant activity fo PSNH which is l
outside of the scopo of thee activit.ies that creditors would
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expect PSNH to engage in within the ordinary course of its business.
6.
It i s my opinion that prior approval by the Bankruptcy Court Would be tcquired before PSN!! coJ1d enter int.o the agtwomerit with MMWEc 4 sic uttaist j u t rit omliers or the Sedoroo'< Nuclear Power Station described in the Boston Globe article.
Such an action would, in ny opinion, be viewed as being outside the ordinary vourse of PSNH's business.
SIGNED AND SWORN TO UNDER THE PAINS AND PENALTIES OF PERJURY
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EXIIIBIT h (there io no EXIIIDIT A)
NYN-58142 Put4c SeMee of New HompeNre Nea samesme var ee D.. s.0n October 20, 1988
.A United States Naclear Regulatory Co= mission One '.'hite Flint North 11555 Rockville Pike N
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Rockville. Maryland 20852 Attentton:
Lando W. Zech, Jr., Chairman
'7 Thomas M.
Roberts, Commtssioner
/G Kenneth L Carr, Co=missioner f[
Kenneth C. Rogers, Commtssioner James R. Curtiss. Commissioner
Reference:
(a)
Facility Operating License NPT-56, Docket No. 50-4a3 (b)
NRC Order CLI-38-07, dated September 22, 1988 Subje:t:
Response to CLI-88-07 Gentlemen:
On September 22, 1988, the Commission issued CLI-88-07 in which it deter-stned that:
che untque and unusual circumstances of this case require that before low power may be authorized, Applicants provide reasonable assurance that adequate funds witt be available so that s.4fe decomstssioniw will be reasonably assured in the event that low power operatton has occurred and a full power license is not granted for Seabrook Unit 1.
'he Commission thus requested that within 30 days of the date of CLI-88-07, Applicants substt:
adequate documentation of their plan and appropriate consnitment s under that plan to provide reasonable assurance that adequate funding for deco =nissioning will be available in the event that a full power license ts not granted for Seabrook Unit 1.
CLI-s8-07, pages 2-3.
The purpose of this letter is to respond to the Co=n t s s io n 's request in CL1-88-07 by presenting a plan describing the steps necessary to return Seabrook Unit 1 to unrestricted use and terminate the license after the factlity has operated at up to 5* of rated power (hereinafter referred to as the Plan), esti=attng the costs of implementing that Plan, and provtdtng assurances that adequate fundtng to cover those costs will be available in the event that authortratton to proceed beyond 51 power is not granted for Seabrook Unit 1, 1
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1 United States Nuclear Regulatory Co-aission Attention: f.ando
- 4. Zech, Jr. Chairman October 20, 1933 Thomas M. Roberts, Commission Page 7 i
Xenneth M. Carr. Commissioner i
Xenneth C. Rogers, Commissivner e
imes R. Curtiss, Commissioner l
implement it should not "end-of-operating-life" decoe:sissioning plans and costs.3be confused with I
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Reasonable Assursnce
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The Joint Owners have consistently acknowledged their responsibility for t
decommissioning the Seabrook project whenever its usefulness comes to an end.
This responsibility takes several forms:
t As licensees of a comercial utilisation facility under the Atomic Energy A t i
as amended, and the Commission's regulations thereunder, the Joint j
of 1954, Owners are obligated to decommission that t
facility at the end of its useful life with minimal impact on public and occupational health and safety and the environment.
i As parties to the Seabrook Joint Ownership Agreement they
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have expressly provided for their several liability for the costs of decommissioning.
(See Paragraphs 11.1 and 13A of the Joint Ownership Furthermore, the State of New Hampshire has legislatively
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Agreement).
restated that obligation and made it enforceable by the New Hampshire
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i During 1997 and early 1998, NHY presented testimony supporting a decommissioning study before the New Hampshire Nuclear Decommissioning Tinancing
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l Com.ittee (the "NH Committee") pursuant to New Hampshire RSA Chapter 162-F.
j Under that rtatute, the NH Committee is assigned the responsibility for deter-t
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mining the funding requirements for permanently removing a nuclear electric-generating facility from service at the end of its energy producing life, such to be collected in monthly installments during the life of the facility, amount beginning with the first full month of service, and to be held undes the administrative control of the Treasurer of the State of New Hampshire.
The NHY's decommissioning study estimated that decommissioning Seabrook Unit 1 after 40 years of operation would cost approximately $242 million in 1987 dollars, t
assuming the use of the DEC09 decommissioning alternative.
The cost differential
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reflects prisarily the significant dif ference in residual radioactivity af ter M years of fuit power operation as opposed to the equivalent of approximately 3/4 I
of an effective full power hour of operation involved in low power testing and the fact that the 40 year life decommissioning cost is based on complete demolition of Unit 1 and includes site rehabilitation.
It does not, however, I
t include other owner cance'.lation costs such as contract termination i
costs, project accounting, claims, settlement and severance pay. A decision j
from ths NH Committee is anticipated in the near future which will establish the initial level of decommissioning funding to be collected pursuant i
to this statute, which level is subject to periodic adjustment during the energy-
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producing life of the facility.
See TriRSA 164-F:22.
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United States Nuclear Regulatory Commission Attention:
Lando W. Zech. Jr. Chairman 0:taber 20, 1963 Thoeas M. Roberts, Commission Page 3 Xenneth M. Carr, Commisstoner Kenneth C. Rogers, Commissioner James R. Curtiss, Commissioner Attorney General.
See NHRSA Chapter 162-F.
As responsible electri attlities and licensees, the Joint Cwners are cooperating with the NH
- ommittee and the Treasurer of the State of New Hampshire to formulate funding arrangements during the anticipated life etthrough whi:h they intend tn fulfill this obligation ments of both the Commission and the State of New Hampshire.the facilit Despite these longer term plans, the Commission has asked for further explanation of how such obligation would be met in the unusual :ircumstance that.suthorization to proceed beyond 5% power is nevor granted after low power testing is performed.
As indicated above, the cost to implement the Plan under such circumstances is estimated to be about $21 million sould be enpended over 17 calendar quarters.
The normal pro:edure under the Joint ownership Agreement would involve each Joint owner being billed for it t proportionate share of those expenditures as they are incurred.
ants:ipated that It is expenses would be 511.98, $5.63, $1.39 and $1.39 million, respectively, for each of the first four years and $.68 million in the final four months.
These amounts, in the normal course, would be payable by the Joint Owners from their gross operating revenues for those periods.
Therefore, those annual amounts should be compared with the gross operating revsnues of the Joint Owners.
In 1987 those gross revenues aggregated approximately $5.066 billion and the Joint Owners aggregate operating revenues. net of purchased power costs and fuel expense, in 1987 aggregated approximately $3.265 billion, la short, the total $21 million cost of tmplementing the Plan equates 1987 and the 0.642 of the Joint Cwners netto 0.42% of the Joint Owners gross revenue year 1987 and would be proportionately less as the Plan implementation costo spread over 17 quarters.
ts In this :ennection it must be pointed out that there tre three Joint Owners to which spe:ial considerations apply.
As to PSNM. it is importan* to as i
note that, as a result of the suspe7sion of certain interest the pending bankruptcy proceeding, available not expenses due to revenues have increased
- and that the obligation of PSNM to pay its share of the costs included in the Plan could not See Midlantic National Bank v.be avoided by reason of the pending bankruptcy proceedin New Jersey Department of Environmental Resource, 474 U.S. 494 (1986).
Massachusetts Munt:ipal Wholesale Electric Company ("MMVEC") with its 11.5934%
I share which is currently seeking a L
- See Response to NRC Question No. 6 in Enclosure to NYN-09115 PSN1 Letter 6
dated August 31, 1988. Re: "Request f or Additional Information," in Docket No.
50-443.
j i
._.