ML20214N432
| ML20214N432 | |
| Person / Time | |
|---|---|
| Site: | Braidwood  |
| Issue date: | 05/26/1987 |
| From: | Chan E NRC OFFICE OF THE GENERAL COUNSEL (OGC) |
| To: | Atomic Safety and Licensing Board Panel |
| References | |
| CON-#287-3615 OL, NUDOCS 8706020175 | |
| Download: ML20214N432 (24) | |
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- 00LKETED USNRC UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION '87 MAY 28 PI
- 53 BEFORE TIIE ATOMIC SAFETY AND LICENSING BOARDy g.
00Cni.U K 3 af v u~
In the Matter of ) BRANcq
)
COMMONWEALTH EDISON COMPANY ) Docket Nos.50-456 ,g y
) 50-457 (Braidwood Nuclear Station, )
Units 1 and 2)
NRC STAFF RESPONSE TO MOTION TO ADMIT LATE-FILED CONTENTIOl{0N FINANCIAL QUALIFICATIONS INTRODUCTION On May 6,1987 Intervenors Rorem, et al. ("Rorem"), filed a " Motion to Admit Late-Filed Contention on Financial Qualifications" (" Motion")
requesting that the Board admit a proposed contention concerning the financial qualifications of potential new co-licensees of Braidwood. The Motion is based on a Memorandum of Understanding ("MOU") filed with the Illinois Commerce Commission on February 3, 1987 by Commonwealth Edison Company (" Edison"). Intervenors assert that Ed! son's April 16, 1987 submission to the NRC of an application to amend the operating license and technical specifications of Byron Station, Unit 2 triggered the filing of its Motion. In the alternative, Intervenors request that the Board certify, to the Commission, under 10 C.F.R. 5 2.758, "the question of whether the Commission rule barring consideration of financial '
qualifications of regulated utilities in operating license proceedings should not be applied in the special circumstances of Edison's proposed new arrangement for the ownership and financing of Braidwood." Motion at 1.
For the reasons discussed below, the NRC Staff opposes both Intervenors' !
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motion to admit the late-filed contention. and request to certify the question to the Commission.
BACKGROUND In December 1978 the Commission published a notice of opportunity for hearing on the operating license application for Braidwood Station.
43 Fed. Reg. 58659, Intervenors were admitted as parties to the Braidwood proceeding. Hearings on the last contention admitted in the proceeding commenced May 6,1986 and concluded with the closing of the record on December 17, 1986. The Licensing Board issued its "Ceneluding Partial Initial Decision (Operating License)" on May 19, 1987.
On May 6,1986, after the close of the record but shortly before the issuance of the Concluding Partial Initial Decision herein on the Braidwood facility, Intervenors filed the subject Motion to reopen the record. This motion is predicated upon an April 16, 1987 request of the Applicant, the
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Commonwealth Edison Company, to amend the Byron Station Unit 2 operat-ing license to add a wholly-owned subsidiary corporation, the Central Illinois Electric Generating Company (subsidiary) as a co-licensee.
In support of the Motion, Intervenors annexed a letter dated April l 29, 1987, from Douglass W. Cassel, Jr. , an attorney for Business and Professional People in the Public Interest and the Sinnissippi Alliance'for the Environment informing the NRC of what he believed to be serious financial qualifications and antitrust issues raised by Edison's proposed j restructuring of the ownership of Byron 2. (Motion, Exhibit B). On the basis of the representations set forth in that letter the Intervenors ;
argued that a new contention should be admitted into this proceeding f a
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( focusing on whether the Applicant or its subsidiary would have the financial qualifications necessary to operate and maintain the Braidwood facility. Motion at 2.1 ARGUMENT I. Intervenors' Motion Does Not Meet the Requirements of 10 C.F.R. I 2.734(a) For Reopening the Record Although Intervenors do not characterize their filing as a motion to reopen, the record, which closed on December 17, 1986, would have to be reopened to receive a late-filed contention. In order to raise a previously uncontested issue in a proceeding whose record is closed, one must satisfy both the standards in 10 C.F.R. I 2.734 for reopening a record and the standards in 10 C.F.R. I 2.714(a) for the admission of a late-filed contention. See, Pacific Gas and Electric Company (Diablo Canyon Nuclear Power Plant, Units 1 and 2), CLI-82-59, 16 NRC 1712, 1714-15 (1982); Pacific Gas and Electric Company (Diablo Canyon Nuclear Power Plant, Units 1 and 2), CLI-81-5,13 NRC 361 (1981).
10 C.F.R. I 2.734 provides:
(a) A motion to reopen a closed record to consider additional evidence will not be granted unless the following criteria are satisfied:
(1) The motion must be timely, except that an exceptionally grave issue may be considered in the discretion of the presiding officer even if untimely presented.
-1/ Although the Board issued its concluding initial decision on May 19, 1987, jurisdiction to consider the subject motion remains with the Board as exceptions have not yet been filed with the Appeal Board.
See, Philadelphia Electric Com?any, (Limerick Generating Station, Uiilts 1 and 2) ALAB-726,17 F RC 755 (1983).
(2) The motion must address a significant safety or environmental issue.
(3) The motion - must demonstrate that a materially different result would be or would have been likely had the newly proffered evidence been considered initially.
(b) The motion must be accompanied by one or more affidavits which set forth the factual and/or technical bases for the movant's claim that the criteria of paragraph (a) of this section have been satisfied.
Affidavits must be given by competent individuals with knowledge of the facts alleged, or by experts in the disciplines appropriate to the issues raised. Evidence contained in affidavits must meet the admissibility standards set forth'in f 2.743(c). Each of the criteria must be separately addressed, with a specific explanation of why it has been met. Where multiple allegations are involved, the movant must identify with particularity each issue it seeks to litigate and specify the factual and/or technical bases which it believes support the claim that this is e meets the criteria in paragraph (a) of this section A proponent of reopening the record bears a heavy burden in Commission proceedings. See, g, c Kansas Gas and Electric Company (Wolf Creek Generating Station, Unit No.1), ALAB-462, 7 NRC 320, 338 (1978). A successful movant must provide with its motion to reopen more than " bare allegations or simple submission of new contentions."
Louisiana Power and Light Company (Waterford Steam Electric Station, Unit 3), ALAB-753, 18 NRC 1321, 1324 (1983); Pacific Gas and 2/
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The test in this regulation is based upon preceeding Commission case law . 51 Fed. Reg. 19535 (May 30, 1986). See, Pacific Gas and Electric Company (Diablo Canyon Nuclear Power Plant, Units 1 and 2), ALAB-598, 11 NRC 876, 879 (1980), cited with approval in Metro)olitan Edison Company (Three Mile Island Nuclear Station, Unit .), CLI-85-2, 21 NRC 282 n.3 (1985). This test received judicial approval. Oystershell Alliance v. NRC_, No. 85-1182 (D.C.
Cir., September 9, 1986); Three Mile Island Alert, Inc. v. NRC, 771 F.2d 720, 732 (3d. Cir. 1985), cert. denied sub -nom.,
Aamodt v. NRC,106 U.S.1460 (1986), reh'g denied 106 WS. lW9.
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Electric Company (Diablo Canyon), CLI-81-5 supra at 363. It must supply supporting material which shows that the tests for reopening the record can be meaningfully applied. Waterford, id.
In addition, the moving papers on a motion to reopen must be strong enough, in light of any opposing filings, to be able to avoid the granting of a motion for summary disposition. South Carolina Electric and Gas Company (Virgil C.
Summer Nuclear Station, Unit 1), LB P-82-84, 16 NRC 1183, 1186 (1982);
Vermont Yankee Power Corporation (Vermont Yankee Nuclear Power Station) ALAB-138, 6 AEC 520, 523 (1973).
Intervenors failed to address the standards set forth in 10 C.F.R.
I 2.734(a) and its motion may be dismissed on that ground alone.
Subsection (b) of 10 C.F.R. I 2.734 requires that, "each of the critiera (in subsection (a)] must be separately addressed, with specific explanation of why it has been met." Moreover, as discussed below, Intervenors have failed to carry their burden in regard to each of these criteria and could not, in any event, prevail on a motion to reopen the record. 3_/
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Further, as discussed in Point I.D. below, the affidavit submitted in support of the motion does not meet the tests in 10 C.F.R. ,
I 2.734(b). J m
A. The Motion is Not Timely i$
Section 2.734(a)(1) requires that motions to reopen generally are not to be granted unless they are timely. The subject Motion is not timely.
Although Intervenors state that their Motion is based on receipt of Edison's April 16, 1987 operating license amendment request to the NRC on the Byron docket, it is plain that the Applicant's public filing with the Illinois Commerce Commission on February 3, 1987 provided the Intervenors with facts necessary for the subject Motion. Motion at 3.
This filing detailed that the ownership of Braidwood Units 1 and 2 and Byron Unit 2 would be transferred to a wholly owned subsidiary of the applicant. Motion at 3; Motion at Exhibit D, Exhibit A, Memorandum of Understanding, at 2. Intervenors attempt to excuse the untimeliness of their Motion of May 6, 1987, by claiming that they were awaiting Applicant's April 16th submissions to the NRC before submitting this Motion . Ifowever, Intervenors may not delay their submission of new contentions or motions to reopen the record until documents are prepared i or filed, but must file such contentions when they first have knowledge of the basis of the new contentions. See, Duke Power Company (Catawba Nuclear Station, Units 1 and 2), CLI-83-10, 17 NRC 1041,1043 (1983).
S!!cnce and inaction for the three months between when Intervenors learned of the fact premising the Motion and the filing of the Motion 'only allowed the Board to get closer to its May 19, 1987 final decision without l l
any knowledge of Intervenors' new concern. Philadelphia Electric l Company (Limerick Generating Station, Units 1 and 2), ALAB-828, 23 NRC 13, 21 (1986). If Intervenors had, as they claim , been i
, monitoring the situation with care and growing concern, its filing is all the more untimely.
B. A Significant Issue is not Raised Section 2.734(s)(2) provides that a motion to reopen will not be granted unless it addresses a significant safety or environmental issue.
Intervenors' Motion does not. The Motion refers to the April 29, 1987 letter by their counsel to the NRC on the Byron docket and contains mere speculation on the consequences of the possible unwillingness of customers to buy power and possible future actions of the Illinois Commerce Commission. The counsel suggests, without support, that the proposed subsidiary, if faced with a choice between the economics of shutting down a nuclear unit or compromising safety, would succumb to pressure to take shortcuts. Motion , Exhibit B at 3 and 6-8. First, the likelihood of a connection between financial qualifications and safety was rejected by the Commission in its adoption of financial qualification amendments, where it stated: "A financial disability is not a safety hazard per se because the licensee can, and under the Commission's regulations would be obligated to, simply cease operations if necessarf funds to operate safely were not svallable. " 49 Fed. Reg. 35747 (September 12, 1984). Thus, no issue of significance can be legally presented on a claim that applicant would continue to operate if it could not afford to do so safely.
Second, under paragraph 1 of the Memorandum of Understanding which Intervenors claim give rise to their concern, Commonwealth Edison undertakes to continue to "be responsible for insuring that [the subject facilities] are operated and maintained safely and in accordance with all
l requirements of the Nuclear Regulatory Commission ('NRC') . " Thus, there is no significant safety concern shown as Applicants remain responsible for the safe operation and maintenance of Braidwood.
Third , a motion to reopen must be based on hard evidence or a j
i change in material fact, not mere allegations or speculation. See, I 2.734(b). See also, Carolina Power and Light Company 10 C.F.R.
. (Shearon Harris Nuclear Power Plant, Units 1, 2, 3 and 4), CLI-79-10, l 10 NRC 675, 677 (1979); Louisiana Power and Light Company (Waterford j Steam Electric Station, Unit 3), CLI-86-1, 23 NRC 1, 6.n.2 (1986);
j Louisiana Power and Light Company (Waterford Steam Electric Station, l Unit 3), ALAD-753, 18 NRC 1321, 1325 n.3 (1983). The affidavit of I
counsel does not set forth factual or technical bases for a safety or 1
i environmental concern. An examination of Intervenors' Motion , the Applicant's response, and the underlying documents shows that !
I Intervenor fail to carry their burden of demonstrating that the Motion raises a significant safety or environmental concern regarding Braidwood, b i
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! 4/ In reaching a decision on whether a significant safety issue has been ,
1 rali,cd the Board should examine the factual nature of the responses '
i submitted by the parties. See, Vermont Yankee Nuclear Power Corporation (Vermont Yankee $Tallon), ALAB-138, 6 AEC 520, .523 '
(1973). In Applicant's May 18, 1987 response to Intervenors' l l
Motion , the affidavit of George P. Rifakes ( Affidavit), a vice president of Edison familiar with the MOU, attributes Intervenors' l' claim that the Subsidisrv could be forced to compromise safety for lack of funds to its "crroneous interpretation" of the documents in
. question and the underlying facts (Affidavit at Paragraph 2). Mr.
! Rifakes avers that the financing agreement between Edison and the Subsidiary would preclude the financial bind predicted by j Intervenors because Edison " commits to make available to the (FOOTNOTE CONTINUED ON NEXT PAGE)
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C. There Is No Likelihood of a Different Result Section 2.734(a)(3) requires that the movant demonstrate that a materially different result would have been likely had the newly proffered evidence been considered frdtlally. Nothing in the Motion is responsive to ,
this final factor for reopening the record. The proposed contention relies mainly on matters set out in its attorney's April 29, 1987 letter on the Byron docket. The speculation by counsel concerning a possible future compromise of safety based on possible financial pressure does not demonstrate that a different result would have been likely in the ;
Braidwood proceeding had any matter proffered been considered initially.
See, Point I. B . , supra. Accordingly, Intervenors have failed to make i the showing required by 10 C.F.R. I 2.734(a)(3).
D. Proper Affidavits Do Not Accompany the Motion Section 2.734(b) requires that a motion to reopen be accompanied by affidavits "by competent individuals with knowledge of the facts alleged or by experts in the disciplines appropriate to the issues raised." The affidavit attached to the motion contains no facts based on personal knowledge which might provide a factual or technical basis for a motion to reopen the Braidwood record. (Motion , Exhibit E). Nor is there an (FOOTNOTE CONTINUED FROM PREVIOUS PAGE) subsidiary during the life of the Units, any funds necessary for the safe construction, operation, maintenance, shutdown, or decommissioning of the units." Affidavit at paragraph 4. Further, as we have shown the Applicant will remain responsible for the safe operation and maintenance of Braidwood.
affidavit of a cognizant expert. The affidavit submitted merely identifies the affiant as Intervenors' attorney pd sets forth his suggestion as to how the Board should rule on a regi[5st for a waiver of the financial qualifications rule. The suggestion itself is based solely on the affiant's speculative reasoning in his April 20, 1987 letter discussed above.
Accordingly, Intervenors have not provided the requisite affidavits for a reopening of the record.
II. Intervenors' Motion Does Not Meet the Requirements of 10 C.F.R. 2.714(a)(1) For Late-File Contentions Section 2.734(d) of the Commission's regulations requires that a motion to reopen which relates to a contention not previously in contro-versy among the parties must satisfy the requirements for nontimely contentions in I 2.714(a)(1)(1-v). SI The Intervenors' failure to meet the requirements of I 2.714(a)(1) is discussed below:
5_/ 10 C.F.R. I 2.714(a)(1) states in pertinent part:
Nontimely filings will not be entertained absent a determination by the commission, the presiding officer or the atomic safety and licensing board designated to rule on the petition and/or request, that the petition and/or request should be granted based upon a balancing of the following factors in addition to those set out in paragraph (d) of this section:
(1) Good cause, if any, for failure to file on time.
(ii) The availability of other means whereby the petitioner's int
- crest will be protected.
(ill) The extent to which the petitioner's participation may reasonably be expected to assist in developing a sound record.
(FOOTNOTE CONTINUED ON NEXT PAGE)
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4 (1) Good Cause The first factor to be considered in passing upon a petition to admit a late-filed contention is whether good cause has been shown for the
)i nontimely filing. 10 C.F.R. I 2.714(a)(1)(1). The Appeal Board has ,
indicated that the more compelling the justification for filing late, the I
more attenuated the showing may be with respect to the four other factors listed in 10 C.F.R. I 2.714(a). See, eg, Puget Sound Power &
Light Company (Skagit Nuclear Power Project, Units 1 and 2), ALAB-523, I 9 NRC 58, 63 (1979). See also, Florida Power & Light Company (St.
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i Lucie Nuclear Power Plant, Unit 2), ALAB-420, 6 NRC 8, 22 (1977), ,
a ff'd , CL1-78-12, 7 NRC 039 (1978). Conversely, where good cause is !
j not shown, the burden of justifying intervention on the basis of the four j other factors necessarily is greater. Commonwealth Edison Company I
(Braidwood Nuclear Power Station, Units 1 and 2), CLI-86-8, 23 NRC ;
j 241, 244 (1986); Duke Power Company (Perkins Nuclear Power Station.
- Units 1, 2, and 3), ALAD-431, 6 NRC 460, 462 (1977). In any event, a j contention must be promptly filed once information is known which will allow it to be formulated. Duke Power Company, CLI-83-19, 17 NRC I
j at 1047. As discussed under the preceeding point, Intervenors did not !
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(iv) The extent to which the petitioner's interest will be j represented by existing parties. ,
(v) The extent to which the petitioner's participation will i
- broaden the issues or delay the proceeding. l l
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bring their concern to the attention of the Board in the Braidwood proceeding until more than three months had elapsed from the time of receipt of the allegedly relevant information. Intervenors were well aware that the record had closed and that the Board was formulating its decision having received proposed findings from all parties by February 13, 1987. Plainly no good cause is shown for the delay in filing this contention.
(2) Availability of Other Means to Protect Petitioner's Interest The second factor to be weighed in judging whether a late filed content'on should be admitted is the availability of other means whereby a petitioner can protect its interest. O Intervenors acknowledge that it had an opportunity to participate in the negotiations with Edison over the company's proposal to restructure the ownership of Dyron 2 and Braidwood 1 and 2. Motion, Exhibit D at 2. Intervenora further state that they are participating in State regulatory proceedingc involving the applicant. Motion at 4. The !!!!nois Commerce Commission and Federal Energy Regulatory Commission (FERC) are specifically entrusted to entertain issues concerning the financial health of utilities and accordingly, it is more appropriate to raise such 6/
The Appeal Board has observed that this factor is accorded relatively less weight than factora dealing with the timeliness of the motion anc the delay in the conclusion of the proceedings.
Detroit Edison Company (Enrico Fermi Atomic Power Plant, Unit 2),
ALAB-707, 16 NRC 17(10, 1767 (1982): Mississippi Power & Light Com?any (Grand Gulf Nuclear Station, Units 2 and 2), ALAB-704, 16 FRC 1725, 1730-31 (1982): South Carolina Electric & Gas Company (Virgil C. Summer Nuclear Station, Unit 1), ALAB-642, 13 NRC 881 (1981).
. lasues in these other fora. Thus, Intervenors have the means to protect their interests before those bodies. The second factor weighs against the admission of a late-filed contention on the financial qualifications of the Applicant.
(3) Assistance in Developing A Sound Record The third factor, the extent to which petitioner can assist in developing a sound record, is accorded significant weight when balancing the icetors in 10 C.F.R. $ 2.714(a)(1). The proponent of an untimely contention must affirmatively demonstrate that it has special expertise that could aid in developing a sound record. Commonwealth Edison Company (Braidwood Station, ifnits 1 and 2), CLI-86-8, 23 NRC 241, 246 (1986):
Long Island Lighting Company (Shoreham Nuclear Power Station, Unit 1),
ALAD-743, 18 NRC 387, 399-400 (1983): Summer, supra, 13 NRC at 982-93; Cincinnati Gas t Electric Company (William 11. Zimmer Nuclear Station), LDP-80-14,11 NRC 570, 576 (1980). The petitioner is required to " set out with as much particularity as possible the precise issues it plans to cover, identify its prospective witnessos and summarize its proposed testimony. Vague assertions regarding petitioner's ability . . .
are insuff!clent." See, B raidwood, supra: Missisalppi Power and Light Company (Grand Gulf Nuclear Station, Units 1 and 2), ALAH-704, 16 NRC 1725,1730 (1982).
In order to meet the test of showing an ability to contribute to the i development of a sound record an intervenor must not only speelfy the precise laeues it plans to cover, but must also show a special expertise in l the subjects it wishes to raise and identify potential witnceses and J
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summarize its proposed testimony. Braidwood, supra: Grand Gulf, supra at 730. Assertions of past participation in NRC or other proceedings or l assertions of the generalized knowledge of counsel on the subject of a j proposed contention is not enough. See, Braidwood, supra at 246-47 j Duke Power Company (Catawba Nuclear Station Units 1 and 2),
ALAB-813, 22 NRC 59, 85 (1985).
i Intervenors only assert that they are informed of Appilcant'a proposals for the ownership and financing of Braidwood and that they have effectively particpated in regulatory proceedings. Motion at 4.
1 These were the particular allegations which were prevjously rejected by the Commichton in this proceeding as a basis for showing an abliity to contribute to a sound record. See, Braidwood, supra. The intervenors 1
i have thus fa!!cd to meet the tests set out by the Commission for showing that they could assist in developing a sound record, and the third factor in 10 C.F.R. I 2.714(a) must be weighed against them.
(4) Extent to Which Petitioner's interest Will be Represented by Existing Parties !
1 l Intervonor states that no other party has undertaken to represent I their concerns before the Commission. The Staff agrees that no other I !
- party represents intervenors' interests in this proceeding. !
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(5) Delay of the Proceeding The fifth factor, the extent to which a petitioner's participation will broaden the issues or delay the proceeding, is given significant weight in balancing the factors of 10 C.F.R. I 2.714(a)(1). See, Braidwood, CLI-86-8, at 247-48.
The record closed on December 17, 1987, and the Board's concluding decision was issued on May 10, 1987. Intervenors had as much informa-tion about the effect of the ownership decision on Braidwood on February 3, 1987 as they had thercutter. Reopening the record to
, litigate Applicant's financial qualifications wotild take a substantial amount
- of time.
In addition, the admission of a contention on financial qualifications l
would substantially broaden the issues and would entall substantial expert i testimony on economic and financial qualification issues not touched on in the previous hearings in this proceeding. Therefore, admission of a financial qualification contention at tida time after the initial decision has been issued would both delay and broaden the proceeding. The fifth factor to be considered under 10 C.F.II. I 2.714(a) weighs heavily against the intervonors.
In short the only factor not weighing against admitting the subject contention is the fourth factor in 10 C.F.H. I 2.714(a). On balance this one factor is insufficient to justify admission of this contention in view of the fact that the other factors welgh against admitting this late-flied contention.
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III. The Proposed Contention Lacks the Specificity and Basis Required by 10 C.F.R. I 2.714(b)
The Commission's regulations in 10 C.F.R. I 2.714(b) require that a party proposing a contention to be litigated, submit the contention with its bases set forth with reasonable specificity. New material in support of a motion to reopen must be set forth with a degree of particularity in excess of the basis and specificity requirements contained in 10 C.F.R. 2.714(b) for admissible contentions. Pacific Cas Electric Company (Diablo Canyon Nuclear Power plant, Units 1 and 2), ALAD-775, 10 NRC 1361, 1366 (1984), aff'd sub. nom. San Lula Obispo Mothers for Peaco v. NRC, l
751 F.2d 1287 (D.C. Cir. 1984), a f'd on reh'g en banc, 780 F.2d 26 (1980). The supporting information must be more than more allegations, it must be tantamount to evidence which would materfally affect the previous deelslon. M. To satisfy this requirement, it must possess the attributes not forth in 10 C.F.R. 2.743(c) which doftnes admissible evidence as " relevant , material, and reliablo. " M. at 1366-67:
Loulslana Power and Light Company (Waterford Steam Electric Station, Unit 3), CLI 86-1, 23 NRC 1, 5 (1986). Intervonors stato that the contention is banod on Edison's April 16, 1987 letter to the NRC and the attachments thereto. (Motion, Exhibit D). That letter concerned only the amendment of the Dyron operating licenso and not Hraidwood.
Intervonors cannot rely on a illing the Dyron docket which may at some future dato affect the ownership arrangement in Draidwood to support a contention in the Hraidwood proceeding now.
Even if this was not a fatal flaw, the bases of Intervonors' concern about the financial qualifications of the Commonwealth Edison subsidiary
. are without support. The letter Intervenors reference (Exhibit D) says the subsidiary's rates will be set by the Federal Energy Regulatory Commission, and Commonwealth Edison's rates by the Illinois Commerce Commission. The f'OU upon which Intervenors rely states in paragraph 1 that: "For operating purposes, Edison will treat the Units on the same l basis as its own units and will be responsible for assuring that they are operated and maintained safely and in accordance with all requirements of l
the Nuclear Regulatory Commission ('NRC')". This MOU also clearly provides for a financing agrooment between Edison and its proposed subsidiary to assure that the subsidiary has sufficient funds to safely maintain anc operate the sublect facilities. Motion Exhibit D. Financing Agreement, Article II: Affidavit of George P. Rifakes, at 3. Thus, Intervenors' broad allegations concerning general safety deficiencies resulting from possible financial distress of the subsidiary are too speculative to provido an adequate basis for a now contention.
IV. Intervenors' Contention in 11arrod by the Commission's Regulations Under 10 C.F.R. I 2.104(a)
Section 2.104(c)(4) of 10 C.F.R. provides that "the lasue of financial qualification shall not be considered by the presiding officer in an operating license hearing if the applicant is an electric utility seeking a license to operate a utilization facility of the type descrlhed in i 50.21(b) or i 50.22". Sco also, 10 C.F.It. I 50.33(f) (financial information la required "except for an electric utility applicant for a lleenso to operato a utillration facility"). See, Georgia power Company (Vogtlo Electric Uonerating plant. Units 1 and 2), f.Ilp-84-35,
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f t 20 NRC 887, 805 (1984): Duke Power Company (Catawba Nuclear sStation, Unita 1 and 2), ALAD-813, 22 NRC 59, 84 and n.126 (1985).
Intervenors, contend that neither Edison nor its proposed subsidiary is an " electric utility" as defined in 10 C.F.R. 50(2) and that the bar in i
10 C.F.R. I 2.104(c)(4) and i 50.33(f) against review of financial qualifications of utilities does not apply in this proceeding. Intervenors' argument is without merit. Both Edison and its proposed subsidiary I clearly cualify as electric utilities under the applicable regulations. The Commission's regulations 10 C.F.R. I 2.101(s) and I 50.2 define an
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) electric utility as
[ A}ny entity that generates or distributes electricity and j which recovers the cost (sic) of this electricity, either j directly or indirectly, through rates established by the j entity itself or by a separate regulatory authority.
Investor-owned utilities, including generation or distribution i subsidiaries, public ut!!!ty districts, municipalities , rural i electric cooperatives, and State and Federal agencies, i
- including associations of any of the foregoing, are included i i within the meaning of " electric utility."
By Intervenors' own admission, the rates of the Applicant and any 1
I subsidiary would be not "by the entity itself or by a separate regulatory i authority." The MOU upon which Intervenors premise this Motion is subject to reguatory oversight by and is pending the approval of the
!!11nois Commerce Commission. Motion, Exhibit B, at 3. Under its terms, l thu applicants continue to be subject to the jurisdiction of that Commission. MOU,12 and f 6. In addition, as Intervenors recognise, 1
the Federal 1:nergy ' Regulatory Commission will regulate the subsidiary's f rates. Motion, I,d. at 5: M0tt 1 1. It is pure sophistry for Intervenors to assert that -- despite tho formulation and subsequent monitoring of the l I
i proposed ownership arrangement and the setting of rates under the aegis l l !
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of these regulatory euti. critics --
neither Edison nor the proposed subsidiary is, an "clectric utility".
Therefore, notwitht. tar. ding Intervenors strained interpretation of the facts which Intervenora concede, it is clear that Edison and its proposed subsidiary are electric utilitics within the meaning of the Commission's regulations, and review of their financial qualifications is barred by 10 C.F.R. I 2.102(c)(4).
V. No Ilasts for Walver or Exemption of 10 C.F.R.
I 2.102(c) Exists Under 10 C.F.H. I 2.758(b)
Intervenors request that if the Board finds that Edison and its subsidiary are electric utilitics within the meaning of the Commission's regulations , the IJoard grant a waiver of the rule banning review of financial qualifications in an operating license proceeding pursuant to 10 C . F. II . I 2.758(b). lloro, too. Intervenors' Motion falls wide of the mark.
Under 10 C.F.It, 9 2.758(b) the Iloard has jurisdiction to waiver Commission regulations in cortain specist circumstancos. in particular, I 2.758(b) provides:
A party . . . may petition that the application of a speelflod Commisalon rule or regulation or any provision thorcor . . . be waived or an exception made for the particular proceeding. The solo ground for petition for walvor or exception shall be that special circumstances with respoet to the subject matter of the particular proceeding are auch that npplication of the rule or regulation (or provision thereof) would not serve the purposen for which the rulo or regulation was adoptod. The petition shall be accompanlod by an aff1 davit that identifles the specific aspect or aspects of the nubfect matter of the proceeding as to whleh appliention of the rule or regulation (or provinton thereof) would not sorve the purponen for which the rule or regulation was adopted, and shall set forth with particularity 1
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, the special circumstances alleged to justify the waiver or exemption requested (emphasis added).
See, Potomat Electric Power Company (Douglas Point Nuclear Generating Station, Units 1 and 2), A LAB-218, 8 AEC 79, 88-89 (1974): Cleveland Electric illuminating Company (Perry Nuclear Power Plant, Units 1
- and 2), LilP-85-33, 22 NRC 442, 444 (1985).
Section 2.758 of 10 C.F.R. further provides for the certification to
! the Commission of the question of whether a rule or regulation of the Commission should be walved in a particular adjudicatory proceeding j where an adjudicatory board determines that, as a result of special circumstances, a prima facto showing has been made that application for i the rule in a particular way would not serve the purposes for which the rule wsn adopted and, accordingly, that a waiver should be authorized.
10 C.F.R. I 2.756(c) and (d). Detroit Edison Company (Enrico Fermi Atomic Power Plant, , Unit 2), LUP-78-37, 8 NRC 575, 584-585 (1978):
Carolina Power and Light Company and North Carolina Eastern Municipal Power Agency _ (Shenron liarris Nuclear Power Plant), ALAD-837, 23 NitC 525, 546 (1986).
In the prosent circumstances, Intervenors request is not supported I
by a propor affidavit based on personal knowledge and no special i circumstances are not forth with the requisite particularity or specificity for either a dotormination that a walvor is appropriato or for cortification of the matter to the Commisalon. Intervonors' affidavit is conclusory and rollen nololy on unsupported speculation and conjecturo.
For examplo, Intervenorn' broadly claim that neither co-liconeco can demonntrate the requisito financial qualifications because the subsidiary lacks finnnetal resources and Edison has limited ability to subaldizo the
- . _ - - - . -- = _- _ - . - .
l . subsidiary. Motion at 2. Paragraph 1 of the MOU and Article !! of the Financing Agreement, Exhitsit R, upon which Intervenors rely, clearly provide that Edison remains financially responsible for the safe operation.
maintenance and decommissioning of the units. Furthermore, the l
financing agreement agreed to by the parties to the MOU and pending approval of the Illinois Commerce Commission, guarantees the availability of funds to the suba,idiary to operate and maintain the units safely.
Notion . Exhibit C at Exhibit E. Whlie Intervenors allege that special circumstances exist, based on what they characterine as a dramatic change in the financial circumstances, no factual support is provided.
l Intervenora suggest without basin the possibility that the Illinois Commerce Commission might not permit Edlaon to provide funds through ,
I the financing agreement if the subsidiary had need for funds to operate, and that even if funds were provided. Edison might not recover costs through the rate-making process. This is pure speculation on the part of Intervenors and is contrary to the Commission's determination upon adoption of the financial qualif! cation rule. gee, 49 Qd. Reg,. 35747 (September 12, 19fi4 ) . In order to show that the rule precluding consideration of utility's financial qualifications in an operating lleense l l
proceeding should be waived, the party petitioning for waiver must show '
l that the electric utility cannot recover its conta through the rate-making process. f ong taland I,lght Co. (Shoreham Nuclear power Station ,
Unit 1) I, IIP-84-30, 20 NRC 420, 433 (1984). Intervonors must make a prima facia showing that the utility has been syntematically denied recovery of costs for safo plant operation. M. at 433-4. Intervenora present no evidence that costs have been or will be denied in the !
.___..-__._..-_.__.-__..-_7-
. l i
rate-making process. Intervenors have not carried their burden to make a prima facie case of special circumstances. Thus, no waiver or exception under 10 C.F.R. I 2.758(6) la warranted.
For the above reasons no reasons exist to refer the question [
preserited to the Commission. ,
l l
CONCf.USION l
The Intervenors have failed to meet the requirements for reopening !
the record as well as those for the admission of a late-filed contention. i Further, the proposed contention is barred by the Commission's regulations precluding review of financial qualincations in an operating license proceeding and no specint circumstances have been addressed to warrant a waiver of that rule. The Board must deny Intervenors' motion to admit the late-filed contention on financial qualifications and deny the request to certify the question of a waiver under I 2.788(b) to the I Commission. ,
t Respectfully submitted, '
l Elaine !. Chan ;
Counsel for NRC 8taff '
l Dated at 11ethesda, Maryland I this 26th day of May,1987
l
?.h l ( UNITED STATES OF AMERICA *87 MY 28 P1 :53 MUCLEAR REGULATORY COMMISSION I
DEFORE T!!E ATOMIC SAFETY AND LICE!! SING BOARhh ,o s t+ ; M i
Si l In the Matter of )
)
COMMONWEALT!! EDISON COMPANY ) Docket Nos. 50-450- d)l.-
) 50-457 (Braidwood Station Units 1 and 2) )
CERTIFICATE OF SERVICE I hereby certify that copies of "NRC STAFF RESPONSE T0 fiOTION TO ADMIT LATE-FILED C0fiTEfiT!0N ON FINANCIAL QUALIFICATIONS" in the above captioned proceeding have been served on the following by deposit in the United States mail, first class, or, as indicated by an asterisk, through deposit in the Nuclear Regulatory Commission's internal mail system, this 26th day of liay,1987:
Iterbert Grossman, Esq. , Chairman
- Commwealth Edison Company Administrative Judge ATTN Cordell Reed
( Atomic Safoty and Licensing Board Assistant Vice President U.S. Nuclear Regulatory Commission P.O. Box 767 Washington, DC 20555 Chicago, IL 00609 Dr. A. Dixon Callihan Region !!!
Administrative Judge U.S. Nuclear Regulatory Commission 102 Oak Lane Office of Inspection 6 Enforcement Oak Ridge. TN 37830 790 Roosevelt Road Glen Ellyn, IL 60137 Dr. Richard F. Colo' Administrative Judge Joseph Gallo. Eng.
Atomic Safety and Licensing Board Isham, Lincoln 6 Deale l U.S. Nuc! car Regulatory Commisalon Suite 1100 ,
l Washington, DC 20555 1150 Connecticut Avenue, N.W.
I Washington, DC 20036 i Michael I. Miller, Eng.
Elena Z. Reactis, Esq. Erle Jones Director Inham, Lincoln & Deale Illinois Emergency Servicca Three First Nationn! Plaza and Disaster Agency Sutto 5200 110 East Adams Chicago, IL 60C03 Springfleid, IL 62705 l Douglass W. Cassol, Jr., Eng. George L. Edgar Esq.
Ihnoiny i,right Esq. Newman 6 Ifoltzinger, P.C.
Itobert Outld, Esq. 1615 L Street, N.W.
100 North Dearborn Street Suite 1000 Sutto 1300 Washington, DC 20030 Chicago, IL 60602 l
r
( Lorraine Creek .*
Ms. Bridge Little Rorem Route 1. Box 182 117 North Linden Street Manteno, IL .60950 Essex, IL 60935 H. Joseph Flynn. Esq. Atomic Safety and Licensing Appeal Associate General Counsel Board Panel
- FEMA U.S. Nuclesr Regulatory Commissicn 500 C Street, S.W., Suite 840 Washington, DC 20655 Washington, DC 20472 Docketing and Service Section*
Atomic Safety and Licensing Board Office of the Secretary Panel
- U.S. Nuclear Regulatory Commission U.S. Nuclear Regulatory Commission Washington, DC 20555 Washington, DC 20555
_N, o Elaine !. Chan Counsel for NRC Staff I
S