ML20234D096
| ML20234D096 | |
| Person / Time | |
|---|---|
| Site: | Braidwood  |
| Issue date: | 07/01/1987 |
| From: | Cassel D BUSINESS & PROFESSIONAL PEOPLE FOR THE PUBLIC INTERES, ROREM, B. |
| To: | |
| Shared Package | |
| ML20234D054 | List: |
| References | |
| OL, NUDOCS 8707070100 | |
| Download: ML20234D096 (135) | |
Text
I I
ATTACHMENT B UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION
{
BEFORE THE ATOMIC SAFETY AND LICENSING BOARD
]
In the Matter of:
)
}
COMMONWEALTH EDISON COMPANY
)
Docket Nos. 50-456 1
)
50-457
)
(Braidwood Nuclear Station,
)
]
Units 1 and 2)
)
{
i l
AFFIDAVIT OF DOUGLASS W.
CASSEL, JR.
I, Douglass W Cassel, Jr., being first duly sworn, hereby depose and say as follows:
1.
I am one of the attorneys for Intervenors Rorem, et al.,
in the above-entitled proceeding.
2.
I have also represented my employer, Business and Professional People for the Public Interest, in extensive negotiations with Commonwealth Edison and litigation before the Illinois Commerce Commission, from mid-December 1986 to date, concerning Edison's proposal tc restructure the ownership of its Byron 2 and Braidwood nuclear u.1its.
3.
I drafted both the motion and the contention with which this affidavit is submitted.
All facts asserted therein are true and correct to the best of my knowledge and belief.
Said facts consist primarily of the terms of Edison's proposal, which is also filed herewith in its entirety, and of certain interpretations of that proposal and of the Illinois Public Utilities Act.
Intervenors will be prepared to submit the testimony of Stephen Moore, Public Counsel of Illinois, in support of these interpretations, at any hearing on this 6
hp A
K 0
1
contention.
4.
For the reasons s tated therein, the NRC rule barring consideration of tne financial qualifications of electric utilities, set forth in 10 CFR 50.33(f), 50.409(b) and 50.57(a)(4), should not be applied in this case, even if it literally applied, because under the terms of Edison's proposal no regulatory entity would any longer undertake to assure recovery of the cost of Braidwood (or of Byron 2).
- Moreover, under reasonable projections of the market for Braidwood power, there is no reasonable assurance that the market price for Braidwood power would be sufficient for cost recovery.
At the hearing on this contention, Intervenors will be prepared to submit the testimony of Charles Komanoff on reasonable ranges of projections of the future economics of Braidwood, and of James Rothschild on the financial implications of those projections for Edison's proposed subsidiary.
Both Mr. Komanoff and Mr.
Rothschild are accomplished experts in their respective fields; their qualifications are being filed with this affidavit as Attachments to Intervenors'+ Motion.
5.
For purposes of reopening the record, Intervenors' Motion is timely because it is predicated on Edison's application for an amendment to its Braidwood operating license, which was not. f iled by Edison until May 28, 1987, and not received by Intervenors until on or about June 8, 1987.
Since June 8, Intervenors have diligently pursued numerous matters relating to Edison's proposal before both the NRC (see, e.g., Attachments G and H to Intervenors' Motion) and the Illinois Commerce Commission, where Edison's proposal is now pending approval, and 2
a p
where various proposed amendments that would' affect the'tinancial
.qualitications of' Edison and the subsidiary.are under
~
consideration.
i l
6.
The financial qualifications of the proposed co-s i
i licensees address a significant safety issue, for the. reasons in stated by Commissioner'Asselstine and by the full Commission,
- describing the original intent of the Atomic Energy Commission.,
(See Attachme'nt'C filed herewith, pp. 6-8.)
The full Commission expressly did not find that there is no link between financial qualifications and safety; rather it found that-regulation of public utilities normally seeks adequately to assure recovery.of costs.
(Id.)
7.
A materially different result would-be likely had Edison's new proposal for ownership and financing of Braidwood existed and been considered prior to the close.of the record in this docket.
Unless Edison'can demonstrate that the proposed
'[ >
co-licensees possess the financial qualifications necessary to t
operate Braidwood safely and lawfully under the proposed new arrangement, the operating license should be denied.
Alternatively, the Commission should consider imposing material conditions on any license approval, such as requiring Edison to obtain additional financial guarantees for the proposed subsidiary.
On L-w U Dougldss W. Cassel,Jr)
Subscribed and sworn to before me this L day of July, 1987:
'RoEaryPubl{ci 3
~
Arpk%& c-y 4
33l 7,
DM)
Business and Professional People for the Public Interest d
109 North Deato<n St eet Sw'n 1300 y
l Te whone 1312; tAl EL70 CNear was 60602
,(
e BY FEDERAL EXPELSS April 29, 1987 Thoman E.
Murley, Director Office of Nuclear Reactor Regulation U.S.
Nuclear Regulatory Con' mission Washington, D.C.
20555 Re:
Byron Station Unit. 2 Application by 1
Commonwealth Edison Company for Amendment to Facility Operating License UFF-6 and Appendix A, Technical Spccifications NRC Docket Mc. 50-455 0
Dear Mr. Murley:
Business and Professional People for the Public Interest (P,PI) and the Sinnissippi Alliance for the Environment (SAFE),
by their undersigned attorney, urge the NRC not to approve Comn.enwealth Edison Company's request for an amendment of the operating license for Byron 2, and not to detern.ine that no h
significant ha::ard exists, without first holding :.djudicatory hearings on the serious financial qualifications issues raised by Edison's proposed restructuring of the ownership of Byron 2.
In addition, BPI and SAFE believe that serious antitrust issues are raised by Edison's proposal, as more fully set forth below.
SAFE has long been one of the intervenors in the operating license hearings on Byron.
Among other issues, SAFE long ago raised questions concerning Edison's financial qualifications (EQ) to operate Byron.
However, SAFE's FQ contention was dismissed after the NRC amended its rules to preclude case-by-case FQ review for regulated utilities.
t
-)
l ou.uc,.
s.
. u, u...e.
s.e.. e s...e
%. e.... t e.m se.,
,u, c..m, v.e.
n....,,a a os,,
t.
. m.,
si.n toe
. t. p,.
,ee g..e r.ec.<
- , o y -e,
s.~. A r...e,
os.u De...
- 1... co.-.,.
.fe'ea. A e't vQ,o c
~.
.,e m,,,,,
o,.,,,,,,,,,,,,,
o,,,,,,,,.,
Irede'EtW Amer L e :. ' 48 best ret Ew ad'4I' W Dh e't M 's p,,"'***
Ctienen W **4 be thana t. be er 6.ii D a + e,e s M D w.e, I L e 1.r e ear C 4Lt-.4 De 4 a v.
- C.* *e:.s '
m I
>$u, tA Cr>e.ae n e f aws tteaaic, tu t.
- 4,,...i
( +,a 6 e'$rr.an Ie~e6
.s.,'e-
.44 *e'e' L e m e-D4's s've r tieti m h f,serrasa Js. art tw man ke.c liviet res A Levv l' - *, 'i p.
- Vd 4 (aa' % n o het bossaems A c- +stia.e d e s s o' s s
v
.,,,,g h.46ft (le A#ete set. tin bigney C SeilJr(l ge-aD f.riep,
it, l.e r' (s L i 9q)A
(.e.6 J T re y 8
W to Free rieart Ise1a'aftvw+4a
$*e'ryliG.. en u t *.se' f sie.is s m.a se e.ss ut,,
L'" P " C. r**.
n' "-. v.
I,2claC, ic',
G"..'m"c..*.*.,***
D*
6**'*
b t,... n s,c. e.... era u.4 * 'o' w( * ",
ee,~..A.c. m.,
- c m~.
u r.
s,,,,,,,
be D df {.se se O'L'\\e O (a f y e a5-te '
f p' 'rth O/i ef Od @M *' %' i f r
h e
l eg,9 69 I'. 4 0*
I e'r #"ftw 40i' t a ma**e Ma'* 0 { 484 star se j ** a N M sl.6W Je* et A es' r, l *t h ne e l J
L
BPI is a non-profit law center.
Its attorneys reprocent SAFE and other intervenors in the Byron operating license proceeding.
In Edsition, BPI was one of the consamer groups participating in ex' tensive, unsuccessful negatiations with Edinon over the conpany's proposal to restructure tne ownership of Byron 2 and Braidwood 1 and 2.
BPI aa an intervenor in the current proceedings before the Illinois Connerce Commission in which Edison seeks state regulatory approval of the proposal.
1.
THE EDISON PROFCSAL.
Edison proposes to alter the ownership and financing arrangements for byron 2 and the 2 Braidwood units in a manner that will significantly affect the financial qualifications of the proposed co-licenseen (Edison and its subsidiary, the Central Illinois Electric Generating Cocpany), as well as raising nee i
antitrust concerns.
In summary, Edison will transfer ownership to the subsidiary, whose sole assets will consist of these three units.
(Memorandum of Understanding
("MU"), 51.)
During the first five years, Edison will buy energy produced by the three units at fuel cost.
(Id., 15.)
The subsidiary's only other incoce, except for bonus payments in the event the three units' output exceed projections (id.), will be monthly capacity payments of $55 million.
Id.
Edison officials have receatedly explained that these capacity payments are projected tc be enough only to cover the subsidiary's depreciation costs, projected O&M costs, and return on debt (but not on equity).
(E.g.,
Ceposition of Edison Vice President George Rifakes in Illinois Commerce Commission Docket 8:,"-0043, April 28, 1987.
Transcript not yet available.)
Thus, if O&M costs of the units exceed projections, or if substantial backfit costs are required, the subsidiary may well lack sufficient funds to cover these costs.
Indeed, the proposed Financing Agreement ("FA") expressly recognizes that in order to meet its obligations, the subsidiary "may be required to make expenditures in excess of the revenues received by it from sales of power."
(FA, Art.I(b).)
During this five-year period, Edison itself commits to make all necessary O&M and backfit expenditures for the three units.
(MU, $1; Construction and Operating Agreement, t4.) However, Edison's ability to carry out this commitment is significantly constrained.
Edison is to be reimbursed by the subsidiary for all such expenses.
(Id., tt3,5,7.)
In the event the subsidiary lacks sufficient funds, Edison cannot simply "give" the subsidiary funds, because the agreement expressly prohibits Edison from providing any subsidy to the subsidiary.
(MU tl.)
2 J/
.The'only..other planned alternative source of fund.; ter the subsidiary would be loans, capital advances or capit al contributions by Edison.
(FA, Art. II,III.)
ilowever, these too may well not be available.
The agreement reccgntres that the affiliated interest provisionn of the Illinois Public Utilities Act will 9overn relationships between Edinon and the cubsidiery.
(MU, 91.) Under those provisions, the Illinois Cornerce Commission would be precluded from approving such loans, advancec or contributions, unless the subsidiary has a sufficient assurance of being able to repay the loan or pay a return on the contribution.
(See Ill.Rev. Stat. 111-2/3,Se7-101,102,)
Given the subsidiary's limited assets and limited income, if the expenses required to meet NRC standards f or O&M or retrofits substantially exceed projections, it is unlikely that the Illinois Commerce Commission would allow Edison to pour toney into a failing subsidiary.
Finally, even if Edison were to be permitted to provide funds to the subsidiary, Edicon itself would have T.ixed incentives at best.
Because of the five-year rate freeze, Edison would be unable to recover any extra costs tror rat *: payers.
(MU, St2-4.)
The foregoing difficulties undermine the financial qualifications of the subsidiary, and of Edison with respect to Byron 2, during the first five years.
After the first five years, the FQ picture is even worsc.
The proposal contemplates that the Illinois Cornerce Commission will select one of three options to govern the period f rom year six through the end of the NRC operating license for Byron 2.
(MU, t5.)
Under the first option, all three units are in the marketplace.
(MU, %5a.)
If the market for nuclear power is strong, the subsidiary may do well.
But if the market is weak, the subsidiary has neither any assured demand for its power, nor any assured floor under the price at which its power may be sold.
(FERC may or may not regulate the price the subsidiary may charge, but FERC can offer no assurance that any customers will be willing to buy the power at cll, let alone at the offering price.)
Indeed, Edison admits as much.
In its Antitrust Review, to its letter of April 16, 1987 to Mr. Murley, Edison notes, "The Subsidiary, unlike Edison, has to service territory and thus, has no assured market for power.
This means that theySubsidiary may be unable to sell the power at prices equivalent to those permitted by regulation.
In that circumstance, the power will be sold at rates determined by competitive market forces."
3 m
l 1
Moreover, under this option, the subcidiary is no longer entitled to receive capacity payments from Edison.
(Power Supply Agreement, 14.1.) Its only income is from whatever payments it negotiates for the power it sells; if Byron 2 were to be shut down, one third of the subsidiary's income-earning potential would be unavailable, l'
Meanwhile, under this option, Edison continues after year 5 to be constrained with respect to Byron 2 by the Illinois Public Utilities Act (MU, 91), and by the prohibition in the Memorandum of Understanding on the subsidiary.
Id.
The second option does contemplate a life-of-plant power purchase contract for Byron 2 (though not necessarily for either of the Braidwood units).
(MU, $5b.)
However, if the midwest market for nuclear power continues to be a buyer's rather than a seller's market, the Illinois Con.merce Cornission is unlikely to select this option.
The third option is merely an extension for three more years of the financial relationships between Edison and the subsidiary prevailing in the first five years.
After the three year extension, the Illinois Commerce Commission would still be left to decide between the first two options.
(MU, 15c.)
II.
FINANCIAL QUALIFICATIONS.
BPI and SAFE suggest that if the. proposed restructuring is accomplished, neither Edison nor its proposed subsidiary will be an " electric utility" as defined in 10 CFR 50.2(x).
Neither Edison nor the subsidiary, therefore, will be exempt from FQ review, under 10 CFR 50.33(f), 50.40(b) and 50.57(a)(4).
In the alternative, in the event the foregoing suggestion is rejected, BPI and SAFE urge the NRC to find that even if the FQ exemption rule technically applies, Edison's new proposal creates an exceptional case in which " case-by-case litigation of the financial qualification of such applicants is warranted."
49 Fed. Reg. 35747 at 35750.
Under either alternative, the seriousness of the FQ proposal warrants an adjudication hearing on its requested amendment prior to any finding of no significant hazard.
10 CFR 50.91, 50.92.
Under the second alternative, an exception to the FQ exemption rule should be made for the hearing, pursuant to 10 CFR 2.758 on the ground that Edison's new proposal, and the financial relationships and conditions it would create, constitute "special circumstances."
See 49 Fed. Reg. at 25751, 4
A.
Neither Edison Nor The Subsidi m Is An " Electric _Utilith ",
For purposes of the exemption from FQ review, an " electric utility" is one which generates or distributes electricity and "which recovers the cost of this electricity, either directly or indirectly, through rates established by the entity itself or by a separate regulatory authority."
Thiu definition must be applied, over the 40-year period of the operating license, since applicants must show their financial qualifications "for the period of the license."
Neither Edison nor the subsidiary meets this cost-recovery test with respect to Dyron Unit 2.
Neither purports to set rates itself.
Each relies instead on an alleged " separate regulatory authority" to set rates sufficient to recover its Byron 2 costs.
In fact, as shown below, no such regalatory authority exists for either entity.
In the case of Edison itself, under the proposal the company, until now a regulated utility, would become the parent company of two major components.
One would continue as a regulated utility under the jurisdiction of the Illinois Commerce Commission; it would include all Edison's generating stations other than Byron 2'and Braidwood 1 and 2.
The other ccmponent, the subsidiary owning Byron 2 and Braidwood 1 and 2, would not be under the rate-setting jurisdiction of the Illinois Commerce Commission.
(MU, 51.)
While the Edison proposal contemplates that FERC would regulate the subsidiary's rates (although, it should be noted, Edison has yet to file its proposal in any manner with FERC), any such FERC i
regulation would not assure cost recovery by the subsidiary.
i Under the !!emorandum of Understanding (16(c); see also Power Supply Agreement, 14.3) FERC would be asked not to upset the terms of the agreement which, as discussed at length in Part I above, expressly contemplate less than full cost recovery.
- Thus, FERC would not qualify as a " separate regulatory authority" under 10 CFR 50.2(x), and the subsidiary would not qualify as an
" electric utility" as defined therein.
I By the same token, since Edison itself would no longer have l
assured cost recovery from its ratepayers of costs associated with Byron 2, which would be owned by the subsidiary, Edison would not be an " electric utility" under 10 CFR 50.2(x) with respect to Byron 2.
Stated otherwise, Edison would become a two-part company.
One part would continue to be an " electric j
utility," while the other would not, and Byron 2 would be in the
)
part that would not continue to be an " electric utility".
i 5
1 n,..<,.,,
m,
'5 D.
Even if Edison Or The Subsidicry Were Deemed To be An
" Electric Utility," An Exception To The PQ Exemption Should Be Made, Due To Special Circumstances._--
The rule exempting regulated electric utilities from case-by-case FO review rests "on the generic conclusion that the rate process assures for regulated electric utilities (or those l
utilities able to set their own rates) the funds needed for safe operation of a nuclear power facility."
49 Fed. Reg. at 35755 (Chairman Palladino); see _i_d.
at 35748, 35749-50.
As shown in Part 1 above, neither the Illinois Commerce Conmission nor the FERC " rate process" will, under Edison's proposal, any longer assure that all funds needed for operation i
of Byron 2 will be available.
This case is thus one of those "special circumstances" in which an exception to the FQ rule, pursuant to 10 CFR 2.785, was expressly contemplated:
For example, such an exccction te permit fincncial qualification review for an operating license applicant might be appropriate where a threshold showing is made that, in a particular case, the
" local public utility commission will not allow the total cost of operating the facility to be recovered through rates.
l 49 Fed. Reg. at 35751.
Accordingly, even if it were deemed that Edison or the subsidiary qualifies as an " electric utility" under 10 CFR 50.2(x), an exception to the rule against FC review should be made in this case.
C.
A Finding Of No Significant Hazard Should Not Be Made, And Certainly Not Prior To Hearing, In The Face Of Serious FQ Questions.
l Under 10 CFR 50.92, a finding of no significant hasard is 1
warranted only when operation of the facility in accordance with the proposed amendment "would not:
(1) Involve a significant increase in the probability..
of an accident previously evaluated; Serious FQ issues, such as those raised by Edison's proposal, do involve a significant increase in accident probability.
As Commissioner Asselstine noted when the new FQ rule was promulgated:
6
Unfortunately, f inancial conniderat ions can and do lead to safety weakneuses in nome inctances.
There have been instances, some recently, in which regulated utility licensees with operating power reactors have emphasized maximizing electricity generation over safety, In many instances, financial consideretions appear to be a I
signficant contributor to these Utility decisions.
Some of these safety weaknesses have been of continuing duration, and not all have been detected or corrected by our inspection and enforcement program.
These examples would appear to indicate clearly that financial considerations can and do affect safety in some instances.
49 Fed. Reg. at 3S754.
The other Commissioners, while noting some support for a con t r a ry:rv iew, made no contrary finding on the link between financial considerations and safety; rather they foond financial qualifications sufficiently shown where regJiatory ascarance of cost recovery exists.
Id. at 35751, 35755 (Palladino).
In fcet, the full Commission noted a persuasive rationale supporting a link between financial' difficulties and safety ha ards:
A financial disability is not a safety hazard per se because the licensee can, and under the Commission's regulations would be obliged to, simply cease operations if necessary funds to operate safely were not available. At most, the Atomic Energy Commission, in drafting the rule, must have intuitively concluded that a licensee in financially straitened circumstances would be under more pressure to commit safety violations or take safety " shortcuts" than one in good financial shape.
Accordingly, the drafters of the rule sought to achieve some level of assurance, prior to licensing, that licensees would not be forced by financial circumstances to choose between shutting down or taking shortcuts while the license was in effect.
Id. at 35749.
Yet that is precisely the choice that may confront Edison's subsidiary in the event of financial difficulties:
the choice between shutting down or taking shortcuts.
For an entity like the subsidiary, which has no generating stations other than Byron 2 and Braidwood, and which could find itself insolvent if one or more of its three units is shut down for an extended period, that choice will be unusually difficult.
Even for Edison, the prospect of insolvency of a subsidiary owning a major portion of the Company's entire assets would not be viewed lightly.
And if the shut-down option is viewed as unaffordable, 7
n
a there will be higher.than normal prescure to opt in. favor of taking shortcuts.
)
For the foregoing reasons, a finding of no signficant hazard, prior to an adjudication hearing on Edison's and its subsidiary's financial qualifications, would be inappropriate and should not he made.
III. ANTITRUST REVIEW BPI and SAFE are advised that the City of Chicago expects to file a separate letter concerning tne serious antitrust questions-raised by Edison's proposal, but glossed over in Attachment 2 to Edison's letter of April 16, 1987 to Mr. Murley.
Since some of BPI's member businesc executives could potentially purchase loser cost pcwer frc=' Edison's con.petitors, they stand to be injured ny contractual provisions which have the effect of increasing the price at hich the suosidiary would sell power to utilities other than Edison, or which have the effect of diminishing competition between Edison and other utilities.
The same is true for those of BPI's memoers who are residents of the City of Chicago, which is presently studying /arious options for producing or purchasing power from sources other than Edison.
Thank you for your timely consideration of the furcgoing comments.
Sincerely,
/
Douglass W.
Cassel, Jr.
One of the Attorneys for BPI and SAFE cc:
Leonard N. Olshan j
U.S. Nuclear Regulatory Commission 7920 Norfolk Avenue Bethesda, MD. 20814 DWC/sp i
1
4TT4UM( ek b-3-
y Commonwealth Edison
/
j One First NaSonal P'aza. Chcago. Hlinois a
'{d 1 Address Reply to. Post Omce Sox 767 h
4
" Chcago, I!!.nois 60690 0767 O
4Q May 28, 1987 Mr. Thomas E. Murley, Director Office of Nuclear Reactor Regulation U.S. Nuclear Regulatory Commission Washington, DC 20555
Subject:
Draidwood Station Units 1 and 2
-Application for Amendment to Facility Operating License NFF-70 and Appendix A Technical Specifications NRC Docket No. 50-456 and 50-457
Dear Mr. Murley:
Commonwealth Edison Company will establish a wholly-owned subsidiary corporation, the Central Illinois Electric Generating Company (" Subsidiary"),
to facilitate an agreement, dated February 3, 1987, among Commonwealth Edison Company, the Governor, the Attorney. General of the State of Illinois, the States Attorney of Cook County, Illinois, several other representatives of state agencies and certain industrial customers of Commonwealth Edisen Cocpany (the " Agreement"). The Agreement is attached as Exhibit A.
The Agreement, which is pending before the Illinois Commerce Commission for approval, concerns a number of contested proceedings before the Illinois Ccemerce Commission and the courts involving the continued construction of Braidwood Station Units 1 and 2, as well as establishing the rates which Commonwealth Edison Company will be allowed to charge in recognition of the operation of Byron Station Unit 2 and Braidwood Station Units 1 and 2.
Specifically, the Agreement contemplates the conveyance of title to Byron Station Unit 2 and Braidwood Station Units 1 and 2 from Commonwealth Edison Company to the Subsidiary in accordance with the Facilities Transfer Agreement which is attached as Exhibit B.
Commonwealth Edison Company will have the right to purchase all electricity produced by the units for at least a 5-year period under a power Supply Agreement which is attached as Exhibit C.
The Subsidiary's rates will be regulated by the Federal Energy Regulatory Commission. The Agreement also provides for a rate increase of approximately 9.6% (net of fuel savings) to Commonwealth Edison Company's retail customers with a five year moratorium on rate increases thereafter. The retail customer rates would continue to be regulated by the Illinois Commerce commission thereafter. Finally, the Agreement provides several options that are s
available to address the rate treatment of the units owned by the Subsidiary after the fifth year. Those options are to be exercited at the direction of the Illinois Commerce Commission.
n-
9 0
Mr. T.E. Murley May 28, 1987 k%s Although the Su'ssidiary will become the titleholder of Braidwood Station Units 1 and 2 (":he Facility") under the Agreement, it is not contemplated that the Subsidiary would itself operate the Facility.
Commonwealth Edison company, under an agreement with the Subsidiary, would continue to operate the Facility and be financially responsible for the operations of the Facility as that term is used in the regulations of the Nuclear Regulatory Commission (the "NRC").
The Construction and Operating Agreement and the Financing Agreement between Edison and the Subsidiary are attached as Exhibits D and E respectively.
Based on the foregoing, we believe the operating license, including the technical specifications, should be amended to recognize the subsidiary's status as titleholder of the Facility. Accordingly, pursuant to 10 CFR Sections 50,.59 and 50.90, Commonwealth Edison Company requests that NRC amend the operat2ng license to add the Subsidiary as a co-licensee with Commonwealth Edison Company as shown'on the marked-up operating license and technical specifications in Exhibit F. of this letter contains additional general information in support of the application for license amendment.
Included is a description of the organization and management of the Subsidiary, the Facility being conveyed to the Subsidiary, and information.concerning technical and financial qualifications. addresses antitrust review. The information presented in this attachment demonstrates that neither the Agreement which occasiens this amendment application nor its implementation constitute changed circumstances which raise any significant issues under the antitrust laws or which require'a further antitrust review.
This proposed amendment has been reviewed and appreved by both on-Site and off-Site review in accordance with Commonwealth Edison Company procedures. We have reviewed this proposed amendment in accordanct with 10 CFR 50.92(c) and determined that no significant hazards consideration exists.
Our analysis is documented in Attachment 3.
The conveyance of the Facility to the Subsidiary requires the approvals of regulatory authorities in addition to the NRC, including the Illinois Commerce Commission and the Federal Energy Regulatory Commission.
Until all necessary approvals have been obtained, the Agreement described above cannot be implemented. It is intended that such approvals will be sought and obtained by July 1, 1987. Therefore, it is requested that the NRC approve the proposed operating license amendment but delay its effectiveness until 12:01 a.m., July 1, 1987. Should it subsequently appear that other regulatory approval cannot be obtained prior to that time, Commonwealth Edison company will promptly notify the NRC.
Commonwealth Edison Company is notifying the State of Illinois of this applicttion for amendment by transmittir,g a copy of this letter and its attachments to the designated State Official.
-,s ur
- n. _
J
l l
Is Mr. T.E. Murley May 28, 1987 1
I l
1 i
In accordance with 10 CFR 170, a fee remittance in the amount of I
$150.00 is enclosed.
)
i Please direct any questions regarding this matter to this office.
]
Very truly yours, l
$f I
S. C. Hunsader Nuclear Licensing Administrator es Exhibits: A through G l
Attachments (1): General Background Information l
(2): Antitrust Review l
(3): Analysis of No Significant Hazards Consideration l
Enclosure:
Fee Remittance j
y l
cc: Byron Resident Inspector NRC Region III Office l
J. A. Stevens - NRR M. C. Parker - IDNS f
SUBSCRIBED AND SWOP to beforpjethis[k day of ~N /hA
, 1987 h
Q Jo~~ Notary'Public()
.s 3107K I-
4
( g,J -
MEM0RANDUM OF UNDERSTANDING
(
. ' sd
\\
d Exhibit A 4
L-..:.........
m.
4- ?
- =
t' s&$
Tebruary 3, 1987 MEMORANDUM OF UNDERSTANDING t
WHEREAS: The co=pletion of the nuclear power plants now under construction in Northern Illinois and the potential i= pact which either completion or cancellation of these plants could have on electric rates, electric service and the economy of the State are matters of great concern to the people of this State; and WHEREAS:
approximately 7.1 billion dollars will be invested in these power plants; and WHEREAS:
protracted and costly litigation concerning the completion of these pcwer plants is continuing and further costly 1,itigation concerning the level of electric rates vill occur unless, resolved by agree =ent among responsible public officials, electricity consumers and co==onwealth Edison company
(" Edison"); and WHEREAS:
the signatories to this Memorandum all agree that it is in their mutual interest to resolve the centinued uncertainty with respect to ce:pletion of these power plants, the g,.......
~~
level'of electric rates and the adequacy of electric service and to resolve those uncertainties without resorting to still further s
I litigation which all agree would only serve to increase the costs to all concerned.
O D-
~.
I k$.
NOW THERETORE, in consideration of the promises and covenants set forth in this Memorandu=, the parties agree to a settle ent upon the principles and understandings set forth be-low:
RESTRUCTURING THE OWNERSHIP OF THREE NUCLEAR GENERATING FACIIJTIES 1.
Edison vill transfer its nuclear generating facili-ties known as Byron Unit II and Braidwood Units I and II (the
" Units") to a. wholly-owned subsidiary (the " Subsidiary").
Neither Edison nor the subsidiary will take any action with respect to ownership (legal or equitable) of the Units that would prevent the Subsidiary from perfor=ing its obligations under the Power Supply Agreement provided for herein.
Edison vill ec=plete and operate the Units transferred to the Subsidiary.
For operating purposes, Idison vill treat the Units on the same basis as its own units and will be respons'ible for insuring that they are operated and main-tained safely and in ac'cordance with all requirements of the Nuclear Regulatory Co==ission ("NRC").
In all aspects of operat-
,ing the Units Edison vill allocate costs and resources on a basis consistent with its general utility operations so as to insure that no subs'idy flows from or to the Subsidiary.
For purposes of treating deferred taxes related to the Units, Edison agrees that during the Initial Rato Period (as defined in Paragraph 3 herein) the Units shall be treated in the same manner as the nuclear units owned by Edison; and that deferred taxes shall not be flowed back kb) to income disproportionately during the Initial Rate Period.
For 2-I D
e-,
gf ratemaking purposes, book depreciation during the Initial Rate Period shall be accrued on a straight-line basis.
Such deprecia-tion shall commence (and capitalization of carrying charges shall cease) for Byron II and Braidwood I no later than July 1, 1987, and for Braidwood II no later than October 1, 1988.
Edinon fur-ther agrees that it vill not cause the Subsidiary to replace Edison as the primary obliger of any outstanding security of Edison existing at the time this Me=orandum is executed.
The Subsidiary vill not be subject to regulation by the Illinois Commerce Cotsission ("ICC" or " Con =ission"), except as provided in the affiliated interest provisions of the Illinois Public Utili-ties Act, and will not be subject to the audit provisions of the Illinois Public Utilities Act.
The Subsidiary's rates vill be subject to regulation by the Federal Energy Regulatory Commission
("FERC"),,, and, subject to the parties' ce==itzents in Paragraph 7 hereof, Edison Vill not oppose the participation by any party to this Menorandu= in'any proceeding before the FERC, including a proceeding to approve the rates to be charged by the Subsidiary.
In connection with the transfer to the Subsidiary, Edison vill Vrite off not less than $550 million of its investment in the
{
Units.
Edison vill file appropriate pleadings with the ICC to
(
)
implement the provisions of this Me=orandum.
Parties t tais He=orandum shall have the right to participate in any hearing called by the ICC relative to said petition.
Edison represents that it does not plan to retiro any of h
its generating units in any different sequence or sooner than that k'
on file with the ICC in Docket No. 86-0249 and Edison acknowledges t l
M
.-v j
i kg that retirerent of its generating units requires the approval of l
the ICC under the Public Vtilities Act.
Further= ore, Edison represents that it intends to operate its generating units in accordance with the principics of econo:ic dispatch (subject to changes imposed by governmental authority) and that its Illinois coal-burning units are, and Edison believes that at least fer the duration of the Initial Rate Period, are expected to be, its lowest cost coal-burning units.
Edison agrees that it will not defer its operating and maintenance ekpenses and capital additions costs during the Rate Moratoriun Period for the purpose of increasing its costs for test year purposes in any rate proceeding after the Rate Moratoriu:
Period.
To enable any party to verify that Edison has conducted its operating and maintenance and capital additions programs in accordance with this ce:nitrent, Edison shall file annually during the Initial Rate Period a report Vith the Co==ission describing itsbudgetedand$ctualactivitiesrelatedtooperatingandrain-tenance expenses and capital additions costs for the previous year.
The report shall include an explanation of any significant discrepancies between the budget and actual expenditures for that year.
RATE MORATORIUM 2.
Edison vill not seek a general rate increase for five years or for eight years if option (c) described in Para-graph 5 hereof is exercised (which 5-year or 8-year period shall ki) be the " Rate Moratorium Period"), except as specifically provided l (
b.m 4
I*
w j
in Paragraph 3 hereof (or, if option (c) of Paragraph 5 is exer-1 cised, the increase per=itted therein), nor vill Edison ctherwise seek any other increase in its rates during this period, except as otherwise provided in Paragrhph 3 hereof.
This paragraph shall not preclude Idison from seeking an increase or decrease in or taking any other action before the ICC with respect to the follow-ing Rates and Riders, or fro: taking any other action with the consent of the party effected by the change:
Rates 1, 1E and IT (but only as these three rates relate to light bulb charges), and Riders 4 (but'enly with respect to avoided cost pay ents),
6, 7,
10, 21, 23 and 27.
(In this Memorandu=, " general rate increase" means any increase for which Edison would, absent a valver by the Commission, have to comply with ICC General Order 210 new codified at 83 Ill. Admin. Code 285).
,,3.
Effective as of July 1, 1987, Edison vill increase its base retail rates by approximately 5660 million, exclusive of revenue taxes. 'Th'e general service rates will be determined by applying a unifor= percentage increase to its base rates currently in effect.
The unifor= percentage increase that vill be applied to the general service rates vill be the percentage that, if applied to all of Edison's base rates, vould result in a revenue increase of approximately $660 =illion.
The parties agree that Edison's residential and general service rates vill be as set forth in Attachments A, B and C.
Attach =ent A reflects a reduc-i l
{
tion in the summer-winter rate differential.
i Except as otherwise required by the ter=s of this Me=orandum, during the Initial Rate k
period fuel costs of the Units shall be included in Edison's
-3_
l l
t
~~~.
~
i a-usY co=putations under its fuel adjust =ent clause in the same ranner as though the Units were owned by Edison.
During the Rate Morato-rium Period, Edison vill not file with the Icc any other request for a general rate increase or for any other increase in rates f
(other than as may result from changes in the rates and Riders listed in Paragraph 2 hereof) except:
Where conditions beyond Edison's control, a s such as, bat not limited to, acts of God, major, economic disruptions, or changes in lev, rules or regulations or interpretatiens thereof, create or result in a financial e=ergency for Edison which threatens Edi-son's ability to continue to maintain an adequate quality of service in its service area or otherwise carry out its responsibil-ities as a public utility; or b.
To recover costs or recoup revenue losses imposed by decisions, or by changes in law, ordinances, rules or regulations or inter-l pretations thereof promulgated or enacted by 1
any Illinois court, the General Assembly or any other Illinois governmental or regulato-ry body or other authority after the dato hereof involving regulatory or tax matters or franchise or similar pay =ents to units of local government, all as applicable pri=ari-ly to electric utilities, public utilities, Edison or regulated industries generally (as distingtished frc= being applicable to all businesses or taxpayers as a class).
To recover any federal acid-rain tax, sur-c.
charge or fee.
The Commission shall make the deter =ination of whether an appro-i priate emergency exists to warrant the granting of a rate increase pursuant to the foregoing subparagraph a.
Further, nothing in this Memorandum shall be construed as preventing any party frem a) contesting an application by Edison to increase or restructure its rates or riders other than as provided in the first two sentences ks !
l J
(.M 4
.W of this Paragraph 3 (or in option (c) of Paragraph 5 of this Memorandum) or b) from seeking a rate reduction where a relaxation of govern =entally imposed costs, such as, for example, a material reduct' ion in taxes, creates a significant vindfall for Edisen.
A "significant vindfall" exists only if in any year Idison's re-ported consolidated not income, before interest expense, produces a rate,yof return on Edison's total book assets (including those of the Subsidiary) which.is in excess of a rate of return which would be just and reasonable if applied to Edison's utility rate base pursuant to the Illinois Public Utilities Act.
On or about July 1, 1992, or, if option c in Paragraph 5 hereof is exercised then on or about July 1, 1995, Edison shall file with the ICC an application for a determination as to appro-priate rates following the Initial Rate Period.
Such application may include a request for a general rate increase (including emergency relief) or decrease.
The period,beginning with the effective date of the rate increase provided for in the first sentence of Paragraph'3 and ending with the effective date of the rates established by this procedure is defined as the " Initial Rate' Period. "
4.
At no time vill Edison seek to recover any revenue 6.:.csho_rtfall or inadequacy which it may believe exists in its rate levels in effect during the Rate Moratorium Period.
This provi-sion shall not prevent Edison from seeking a rate increase under the terms of the exceptions specified in subparagraphs (a), (b)
(
and (c) of Paragraph 3 or from seeking emergency rate relief k
immediately following the Rate Moratorium Period. ll S m_...,._...
_9
W (A
POhT.R SUPPLY AGREEMDiI 1
5.
Edison vill enter into a Power Supply Agree =ent with the subsidiary whereby Edison will have a right which chall take precedence over the right of other purchasers to purchase all of the output of the Units for five years.
Edison vill buy elec-tricity from the Subsidiary when doing so'is cheaper than produc-ing electricity fro =,other units or buying it elsewhere.
In exchange for the right to buy electricity, Edison vill pay a fixed monthly fee of $55 million to the subsidiary.
During the five year period ending June 30, 1992, Edison vill pay only the cost of fuel, plus amounts equal to the amounts of bonuses provided for in the Output Guarantee provision of this Paragraph 5, for the elec-tricity it buys from the Subsidiary.
l outvut cuarantee If th'e Subsid'iary is unable to produce energy from the Units at the cumulative target levels set forth below, Edison guarantees, through the operation of the fuel adjustrent clause
(,by making credits against costs reflected in that clause),
to co=pensate ratepayers for the excess costs of replace =ent power over the fuel costs of the Units; provided, however, that Edison shall not be obligated to absorb more.than $660 million of re-placement power cost in respect of a shortfall in any of the years 1988 through 1991, or $330 million in respect of 1987 or 1992.
The amount of replace:ent power in respect of any year shall be C
deemed to be the shortfall in cumulative target level output as of
.g I
}
^-~~~
4 (a
st the end of such year less the a=ount, if any, of such shortfall at the and of the preceding year.
In computing the shortfall in output under this paragraph, only one-half nf any energy for which l
Edison has received a bonus of one-half of the savings pursuant to the immediately succeeding paragraph, shall be considered as y
energy output of the Units.
l If in any year the Subsidiary produces energy from the Units in excess of 110% of the annual target level set forth below for such year, Edison shall be entitled to a bonus based on the savings relat6d to all energy produced in excess of 110% of the target output.
Such savings shall be the difference between replacement power costs and the fuel costs of the Units applicable to the energy representing output in excess of 110% of the target output.
The bonus shall be equal to the full a=ount of such savings,to the extent those savings do not exceed the a=ount of credits previously paid pursuant to the preceding paragraph and half such savings'to the extent such savings do exceed such cred-its.
ln determining if a bonus is earned, all kWh output in any year up to 110% of target levels shall be considered norr.a1 out-put.
Then any output achieved in that year after 110% of the target output has been achieved shall be considered excess output i
- eligible for the bonus.
Any credits, bonuses or adjustments to be =ade as a result of the Output Guarantee shall be accomplished through
{
operation of the fuel adjustnent clause.
(
l (I) n c5)
J
.h4 ww/
TARGET LEVELS Annual' Curulative year Gicavatthours Gicavattheurs July-Dec 1987 6,000 6,000 1988 11,000 17,000 1989 13,200 30,200 1990 16,100-46,300 1991 18,000 64,300 Jan-June 1992 7,550 71,850 1
Co==enwealth Edison vill propose methods and procedures I
to estinate replace =ent costs for power, and'sub=it such proposal to the parties to this Memorandun for co==ent.
All parties agree to work together to develop a.eutually egreeable approach.
In the-event that there are unresolved disputes, the parties agree to submit the matter to the ICC for hearing and resolution.
Caoacity Guarantee The cumulative Target Level Gigawatthours as of July 1, 1992, as set forth' above in this paragraph 5, assu es that Byron II and Braidwood'I each will produce 25,273 gigawatthours during the period and that Braidwood II~ vill produce 21,304 gigawatthours during the period.
If, as of July 1, 1992, either Byron II or Braidwood I has produced less than 20% of its share of the Cumu:
- 1/e Target level Gigawatthours, and as of such date, that Cnit has become inoperable and it reasonably appears that the Unit will not operate in the foreseeable future, Edison shall be obligated to provide. additional credits against costs used in computing fuel adjustment charges under Edison's retail rates.
a as Such credits vill be deter =ined in accordance with Attachment D. '
i
~
ya. n J
--~,.
1 4-4#
However, no such credits shall be made if the aggregate of the credits provided for under the output Guarantee is equal to the aggregate amount of fixed monthly fees paid by Edison pursuant to l
Paragraph 5.
Dotions After Five Years The Subsidiary shall agree to offer to Edison the fol-lowing options, exercisable by Edison (after hearings and approval by the ICC) no later than July 1,1991, relating to Edison's right to purchase p'over from the Subsidiary following June 30, 1992:
Edison may purchase power from the a.
Subsidiary when and as available for a period of 20 years at prices subject to TERC jurisdiction and have the " favored nations" rights set forth in Attach =ent E attached hereto.
(Nothing contained herein shall be deemed to deprive the ICC of any authority it may have to approve contracts for purchase of' such power or to review the prudence of such* purchases); or b.
Edison may contract to purchase not less than the entire a cunt of the output of Byron Unit II for the re=ainder of its useful life and such a=ount of power (in blocks of 100 megawatts) fro: Braidwood I as Edicen shall designate at the time of exercise of this option, over the recainder of that Unit's useful 111..
Such power shall be sold at rates deter =ined using traditional net original cost rate base / rate of return regulation and accounting for fuel and all other costs of produc-tion, all as deter =ined by the FERC from time to time.
The Illinois retail share of the costs thereof
(
(,,
chall be fully reflected in Edison's retail revenue require =ent in any proceeding before the ICC to deter-mine Edison's retail rates.
If e m b,
- {,
.o
'h Edison has elected to purchase any smounts of power from Braidwood I pursuant to this option (b), Edison may, effective on July 1, 1997 or, if option (c) has been exercised, on July 1, 2000, reduce the a=ounts of power (in blocks of 100 megawatts) from Braidwood I which it must purchase, by giving notice of such reduction 12 months prior to the effective date.
(If Edison exercises the option to purchase the entire output of Braidwood II and option (c has been exercised, Edison can)not reduce the amounts of power' purchased from Braidwood I on t
July 1, 2000.)
The amount charged to Edison will be reduced to reflect this reduction, and the Illinois retail share of these lower costs shall be reficcted in Edison's retail revenue requirement in any proceeding before the Icc to deter-mine Edison's retail rates.
If Edison exercises this option (b) and has not reduced the amount of power it has elected to purchase from Braidwood Unit I it shall have a further option, exer,cisable on December 1, 1998, to purchase not less tha Braidwoo,n the entire output of d II during the period January 1, 2000 through the re=ain.
der of.its useful life.
If Edison elects to purchase such output, the rate Edison vill pay therefor shall be the greater of (1) the market value of power as deter =ined with reference to third party, arms longth, long ter= firm power pur-chase contracts commencing approxi-1 mately Janue y. 2000, or (2) prices t
deter =ined u.ing traditional net original cost rate base / rate of i
return regulation and accounting for fuel and all other costs of produc-tion, all as deter =ined by the FERC.
The Illinois retail share of the costs of any output so purchased shall be fully reflected in Edison's k
(
retail revenue requirement in any
{
proceeding before the Icc to deter-mine Edison's retail rates.
I i
}
\\
H
>,va' i
Y
./
For purposes of traditional not original cost rate base / rate of return regulation whenever provided for in this option b, rate base shall be calculated af ter deducting the applicabic portion of the not less than S550 million write-off specified in paragraph 1; or Edison may defer the election of c.
options (a) or (b) until July 1, 1994, in which case it shall be entitled to a one-time retail rate increase beginning on Jul The increase vill be acccy 1, 1992.
plished by applying a uniform percentage increase to base rates then in
- effect.
The percentage increase vill be the lesser of 1) one-half of the cu=ulative increase in the Consu:er price Index for All Urban censumers, published monthly by the U.S. Department of Labor Bureau of Statistics, for Chica Northwestern Indiana,go, Illinois --
fro: April 1, 1987 to April 1, 1992, or 11) 7.5 percent.
If Edison elects this option (c), -
the $55 million monthly fee payable to,the Subsidiary pursuant to this paragraph 5 shall be adjusted to reflect the full amount of the increase, and the output and Capaci-ty Guarantee provisions of this paragraph 5 shall not apply during the period of the extension.
In the event that this option (c) is exer-cised, then the deadline for exer-cising options (a) or (b) shall be extended to and including July 1, 1994.
i Edison vill select one of tne above options as directed by the ICC.
i It is understood and agreed that the right to exer-cise options (a), (b) and (c) above, or any part of them, is to be Edison's under its agrecuent with the Subsidiary, but the determi-k) l nation of whether or not such optiens should be exercised for the h
m
-4 benefit of Edison's ratepayers shall rest with the ICC and the ICC chall direct Edison with regard to said options.
From time to time Edison vill institute proceedinas before the ICC to obtain its direction and authority to exercise (or not exercise) such cptions within the tire frame per=itted for the exercise of said options.
Nothing herein shall be construed as granting the ICC authority to direct Edison with respect to the a=ount of power it is to purchase under. option (a).
If the FERC declines to nahe the deter =inations required under option-(a), if any, and option (b), then the ICC will be requested to make such deter =inations.
If the Consission fails to direct Edison as to which option it is to elect on or before July 1, 1991 (or if option (c) is elected by July 1, 1991, and the Cctrissien subsequently fails to further direct Edison with regard to the election of options (a) or (b) on or before July 1, 1994) and Edison has filed Vith the ICC a request' for direction no later than 12 conths prior to the date in question:
(i)
Edison shall be dee=ed to have elected to contract to purchase the entire output of 3yron II for the rerainder of its useful life and 50% of the entire output of Braidwood I for the remainder of its useful life, all effective as of the terri-nation of the Rate Moratorium period; t
(ii)
Edison shall have no further options under this Me=orandus; and (iii)
The rates for power contracted for pursuant
(
to subparagraph (i) above shall be deter =ined as i
provided above with respect to output of Byron II and Braidwood I contracted for under option (b).
kar p i
i B
r
' W' Tg a
a REGULATORY AND JUDICIAL ACTIONS 6.
Edison's cbligations under this Memorandum are dependent upon the regulatory and judicial actions referred to below:
A.
Illinois ce==erce Co==ission Action to be taken before May 1, 1987.
(i)
Authorization of creation of the
~
Subsidiary and transfer of the Units and permits and licenses related thereto to the Subsidiary.
(ii Approval of agreements between Edison a)nd the Subsidiary.under which Edison will cc=plete construction of the Units and operate the Units and purchase power from the Subsidiary.
(iii)
Authorization for Edison to invest in the Subsidiary, from time to time, as required to assure proper maintenance and operation of the Units.
(iv)
Release of Edison from any obliga-tion it has to ce=plete the Units pursuant to prior orders of the cc=micsion.
'(v )' Authorization for Edison to guaran-tee the subsidiary's obligations and liabilit-les with respect to safe operation of the Units.
(vi)
Approval of rates reflecting the rate increase provided for in the first fcur
~
sentences of paragraph 3 hereof, including any necessary waiver of General order 210.
(vii)
Approval of a suitable modificatis.1 in Rider 19 to limit its availability in the case of changes in ownership of existing facilities.
g (viii)
A state =ent of intention not to j
oppose any reasonable proposal by Edison during the Initial Rate period to refinance t
securities or otherwise to revise its capital
{*/
structure so as to enhance the position of its stockholders within the framework of the revenues allowed Edison during the Initial I" D
1
[). 9
/
1
. g ~..
%s -
f}
1 Rate Period under this Memorandum, it being
'\\
understood that any such action is not binding on a determination of revenue re any subsequent rate proceeding. quirements in a
(ix)
A statement of intention to refrain from reducing Edison's rates or revenues during the Initial Rate Period, unlecs re-1 quested to do so by Edison.
(x)
Satisfactory resolution of the fol-loving Commission matters so that Edison may charge the rates provided for ir,this Memoran-
?
dum and consummate the' transactions described
\\o t herein and.is not required to make any refunds (t ]'
in respect of pa.st charges:
- s (a)
Braidwood construction case (b) staff investigation into Edi-son's future rates 1
(c) staff investigation into effect of the 1986 tax reform act as 1 '
to Edison (d) pending Rate 1 restructuring s
(e) notice of inquiry into excess capacity (it being understood
'!)
that it shall be a satisfactory resolution for this purpose if the commission's determination.
has no application to Edison for the term of the Initial I
Rate Period or as its capacity may be deemed to be affected by purchases pursuant to option b of Paragraph 5.
However nothing herein shall prec,lude
~,
an excess capacity inquiry or
\\
adjustment at such time as Edison has acquired (through construction joint ovnership or purchase), capacity in addi-tien to existing capacity and t
capacity acquired through the i
exercise of option (b) of Paragraph 5.)
l; th (f) pending fuel reconciliation
%v proceedings
' C'
-t bish-A,3 mag,.;,ma j
m,p Y
v.
l cr 1sp I {, 30' f
J C.
"73 '
4'.
(g) pending audits pertaining to i,'
Byron II and Braidwood I N{t T
th)
Unifor: fuel clause proceed-d,.
ings (it being understood that satisfactory resolution would d~.
preserve Edison's f9e1 clause r
in essentially its present for: (with modificati'ons re-s quired under this agreement) for the Initial Rate Period including the right of the Cc:=1ssion to require Edison to 1
operate on an econo:ic dispatch t-f#
basis).
It is further agreed ic J
that during the Initial Rate Period Edison vill not be re-quired or permitted to recover purchased power de and charges or fixed fees for purchased g
power through the fuel clause.
(
B.
Timely grant of Nuclear Regulatory Co::ission 3-approval of transfer of the Units and their li'-
censes to the Subsidiary.
y C.
Tirely grant of any necessary TERC approval of the rates and transactions provided for in this Memo-randum.
D.
Judicial action having the effect of affirming the Commission's July, 1984, and October, 1965, Edison t
1
(
rate orders in their entirety.
y E.
Ti=ely action by the Securities and Exchange Co -
y rission confirming that Edison vill remain exe:pt from the registration requ.tements of the Public Utility Holding Company Act of 1935.
, !"r:
i F.
~Any other govern = ental action required as of Ju-i 1 1 ly 1, 1987 for consu :ation of the transactions provided for in this Memorandu: vill be taken in a timely manner.
COMMITMENTS OF THE PARTIES f
a 7
Edison commits to use its best efforts to acco:-
d
[
4ss plish the regulatory and judicial actions described in Peragraph 6 d'
as pro:ptly as practicable and'will institute proceedings in l'
1) 9 g ~ 2-.m.m O
L.=
J
l
.J i
furtherance thereof before the ICC to i=ple=ent the provisiens of this Memorandum on or before Tebruary 6,1987.
The other parties to the Me=orandum agree to support the ter=s of this Memorandu: in any proceeding in which they are participants before the ICC, the NRC and the TERC.
The parties agree that for the Initial Rate Period they vill not take any action (whether before a regulatory body, the General Asse bly or any other legislative body, or any court) that vould prevent or require the undoing of any of the transactions contemplated by this agreement, it being understood, however, that-in Supreme Court Docket No. 63747, Pee:1e pl the State pl D1ineis 33 Ill Feil I. Eartican, Atternev General y.
Illinois Cor. erce Co--issf oJ and Correnveelth Edisen Corrany",
the parties have presented their positions and have the discretien to deter =ine what action to take in that case.
The parties other than Edison upon proper notice authorize Edison to represent on j
their behalf before any regulatory body or court that they are signatories to'thls agree =ent and have agreed to the regulatory action described in Paragraph 6.
The parties recognize that Edison's agree =ent to limit the level of its rates or othe vise to
, adhere to the ter=s hereof is conditioned upon cc:pliance with this Paragraph 7 by all other parties hereto.
Edison's failure to acco:plish the imple:entation of the vettlement on or before September 1, 1987 chall discharge the parties hereto fro: all obligations with respect to the regulatory and judicial actions set out in Paragraph 6 hereof, provided, however, that if Edison f
k" has extended the termination date set forth in paragraph 8 to a date later than Septe:ter 1, 1987, then such later date shall be 'l i
ti cL.
m..
T, substituted for Septe:her 1, 1987 in this sentence.
It is further understood that the parties may participate in generic dockets related to the subjects specified in subparagraphs A(x)(e) and (h) of Paragraph 6 hereof.
However, the results produced by these dockets shall not be used by any party in conflict with the representations related thereto in this Paragraph 7.
GENERAL 8.
This understanding shall ter=inate if all regula-tory and judicial action contemplated herein has not occurred prior to July 1, 1987, except as otherwise provided in this Para-graph 8.
Edison shall have the right to extend the deadline for or valve any such action, subject to the limitations herein con-tained'.
Daring the period of any such extension, Edison's rates shall proyide for charges no higher than the greater of (i) charges per=itted under Edison's rates now in effect, or (ii) i charges under su'ch rates as they may be changed under Paragraph 2 or 3 hereof.
No such extension shall cperate to extend the termi-i nation date of the Rate Moratorium Period, or the date by which
, options in Paragraph 5 may be exercised.
No such valver shall permit Edison to place in effect any rates which previde for O,r charges higher than the greater of (i) charges per=itted under Edison's rates now in effect, or (ii) charges under such rates as they may be changed under Paragraph 2 or 3 hereof.
{
If Edison extends any deadline pursuant to this Paragraph 8, and this under-p (s'
standing, nonetheless, thereafter ter=inates because regulatory or judicial action conte = plated herein has not occurred prior to the i]
ri L
a l
as extended deadline, its rates now in effect shall be reinstated as of the date of ter=ination.
No such extension shall expire later than December 31, 1987.
In addition, in the case of such a termi-nation, if during the period of the extension Edison places in effect a general rate increase, the output Guarantee provided under Paragraph 5 shall be considered to be in effect during such period.
For that purpose the E=ount of output guaranteed shall be equal to 33 1/3 gigawatthours =ultiplied by the number of days the increase is in effect and the maximu= fuel adjustment clause credit will be equal to S1,833,333 multiplied by such nu=ber of j
days.
This understanding shall not be construed as preventing
'r Edison from filing for a rate increase in respect of its invest-nent in and operating and maintenance costs associated with Byron II and Braidwood I and II prior to July 1, 1987, nor shall i
it operate to prevent the parties from contesting such applica-tion.
No increase which may result fro:
I any applicatien pernitted by the precedin'g sentence shall become effective during the period i
of any extension of th'e July 1, 1987 deadline.
Any such applica-l tion for an increase vill be withdrawn if the necessary regulatory and judicial action has taken place by July 1, 1987 as that date may be extended as provided in this Paragraph 8.
9.
In addition to Edison's other rights in respect of any failure to meet the conditions to its obligations hereunder, (a) if, prior to the ti=e the regulatory and judicial actions l
specified in Paragraph 6 occur, in Edison's reasonable judg:ent it appears likely that any governmental action provided for herein k"#
vill not be taken within the ti=e specified in paragraph 8 (ether a
.v.
sf.
than because of Edison's fault), or (b) thereafter if.Edisen and at least two of the other parties to this Memorandum believe it likely that any such action vill be invalidated, in whole er in part, Edison may terminate the understandings embodied herein and if Edison has already conveyed the Units to the Subsidiary, Edison shall have the right to cause the Subsidiary to reconvey the Units to Edison.
The ICC order approving the conveyance.to the Subsid-
'iary shall contain appropriate provisions approving such a recon-vayance.
Any such reconveyance shall be without prejudice to.any party's rights to oppose and to raise all argn=ents and positiens and to pursue procedures provided by law or regulation regarding-
"ratabasing" the Units and reflecting their costs in rates.
10.
The obligations of the signatories to this Me=oran-dum aOa also conditioned upon the establishment and. continued effective, ness of rates consistent with this Me=orandum throughout the Initial Rate Period.
11.
An) disputes over the interpretation of this Meno-randu: vill be co==itted to the respective regulatory agency j
having jurisdiction over the subject matter.
12.
The parties agree that any FERC-mandated modifica-tiens, alterations, amendments or changes to any co:ponent of the
-'*s provided for in this Memorandu=, the Power Supply Agreement or any other governing document, or the ter:s or conditions there-of, shall not constitute a basis for a change in retail rates during the Initial Rate Period.
This provisien shall not be construed as nodifying or in any manner limiting the condition
([)
imposed in Paragraph 6C.
13.
Edison agrees to take any action necessary to l
ensure that the subsidiary, with respect to its own obligaticns, shall be bound by this Me:orandum as if it were an original signa-tory.
Edison vill furnish evidence of the Subsidiary's acceptance of the terns of this Memorandum.
l Memorandum of Understanding dated this 3*W day of February, 1987.
a cor.=onwealth Edison company (4tM By
,e fa~eso o'connor, thairman a
w e
/
~22~
^
1 j
~<
J 1
1 Memorandum of Understanding dated this day of February, 1987.
1 James R. Tho:pson, Governor, on behalf of the People of the State of Illinois By
(
j' 4
4 g
e W
w (a.;a a#
h
- TfLL
s Memorandum of Understanding dated this b day of Tebruary, 1987.
The Small Business Utility Advocate
,D sy 22 l<rb Av,_
r W1111a= G.f d
t 9
a b
e l
I l
4
.tuM P
i I
a j
f '-
Memorandum of Understanding dated this day of Feb rua ry,1987.
The Governor's Office of Consumer Services
//%
f.2 BY
'e hl Alvin K. Grandys, Ph.D. /
Director e
b l
( e. -.;
l s/
rm
s I
1 l
&,!.Y Memorandum of Understanding dated this 'I day of l
1 February, 1987, i
)
)
i Neil T. Hartigan, Attorney General' on behalf of the People of the State of(.IllinoisP
(
?
By
/
f-1
(,
i 9
e b
4 0
(W P
o 2
th
%s Memorandum,of Understanding dated this d day of February, 1987.
Richard M. Daley, State's Attorney, on behalf of the Pecple of cock-county, Illinois
- - - A l
1 e
O 1
9 M
N y
ah
-_ n
E i*
,J.
Memorandum of Understanding dated this J f day of February, 1987.
The Illinois Industrial Energy Consur.ers (IIEC) Pary Interveno" in Docket 86-0249
/
By
/
//
FMDA1.L ROBERTSON Attorney for IIEC 0
4 l
l
~
e 0
e 4s I' e y
' W
--:m.
K
y a
Attach:en?. A ELECTRICTTY
)
Tor the Oum and Vinages listed an j
h" ILL. C. C. No. 4 Commoeu caJth Setets Nw. 4,8,6,7 and 8 Rega d sh,. No. 9 i
Edison Compso) aM the ir.ncoyrid cereme tamry RATE 1. RESIDE.NTIAL SERVICE AsallabrHy.
TAs raie is avsCaWs to any castuner usrs de Comparty's alac:ne servkx fa residctr.ial purpassa.
Charge.
- Monthly Customer Charge.
Juty1.1987 Drwgh January 1,1989 December 31.1988 and After i
For Cusurner sesids g m:
A buDMg c:rnaeung 3 or mcri d weing ordts.....................
5350 3343 A Md.ng scrua r..ng 1 or 2 dettang unAts.......................
5 9.10 5 8.86 BuDdess ccritaining 1 or 2 d.cring nruts shau include, but ocs tu lirruud to strue wu cornmerJy refer td to u si. g]e famJy deacted bouses, sir:gle family ar. ached bcuses, row b,usca. town bouus. semi <icated tauses, d.ple.scs, two.
fists, and two fams, emacs.
On Dummber 10. 1964, the Cor m had essirred d exis.ing Rau 1 csamanen to one d tin cha ge clas:(icauens descr; bed above. If any of these cunorects mfonr.s the Cornpany that thu iratial classlicaUon is i'icorria, the Cartpany spon vertficaGon, wiD pla:r the cussomer m Ac arpryna.: classJmem taa wd oci issa any retai
- Energy Cisarge.
July 1.1987
% rough January 1.1989 Decemtaer 31.1%8 and After c.,., u...
O.a se per kdowsr. hour (cr fss:400 kDomsr. hours sQbed in the rnarA......................................
11.964s 11.M$s Charge pr kdomicour for aD kJo a&ws mer 400 suppLcd a the rnana.....................................
Is770s
- tue, o.w ug O.4 3: pr kdomar. hour for first 400 kUcwor.houn sqpLedin the mcr:1......................................
11.9644 11.M5s Cha go pr kDowse: air for a3 k2o.securs e=cr 47) suppbed in te mon 8......................................
5.39 s
$306c For the parpeses herect, she summer Mr.hs sha3 he ce conmeis firm armNy b?. ;rs priod wuh an endes rneur reades dam us or al.cr kne !$ snd the thrt.: sw.ceed g monJJy barg penodo De fuel adpsenet sta se ce creda prtwided f:n in Rader 20 sta3 apply to a3 n h a:.h.rs suppbed in the 2.
Late Pajtnent Charst.
The laa payent charge prwide.d for in the Tc.ms and Conidma d this Sded.de d Fmes aba3 he a,$abis no aD cha gu under stus rass.
Light Bulb Service.
The above charges do noi include light bulb servia. De charge for euch servia shar be 017ds pr kilosschour for the first 500 kilom adours supple 4 in the manA IJshi bulb servu:e is described in Radcr D and u opkr.a! wuh the mr<w.cr.
M)ntrnum Charge.
,. T.he trJrinnen montFJy d.a ge shan te the MetJy C.astcrner Charge.
y
" Term of SirWs.
The cusiamer's term of service shaU ccenmence when the Cornpany begins to sirpply service he.eunder aM shd cza.dnu ect mort than ten days at.cr route is received to 6scoru.nus servwx.
Three4'hase Servlee.
Three phase service is evacable onder this rats. Where a three phase secondary swply is ant s' acable frwn the Canpary's d6nnbusan system adpcent to the cunomer's properry, the necessary prvnary and secorary c2:a uions *C1 be fumished ty the Cornpany subje: to the praissons d Rader ?.
4.#
(Continued em shee: Nc6101 Date Effectne: Ju!!I,1987 Astertsk (') Indicates change
! sued b; C. P. Rafakes. YW President, Pois Omee Boz 767.CHcago.!mnds 60590
C, 4
f Atte:hi.er.t 3
'~
ELECTNICITY f4 For uie Clum sad Vinsges head on
!!.l C. C. So 4 Q
Commonecelth Shesu bas. 4,5,6,7 and Restsed Sheet se 24 i
T41mn Com;anf are the wer;xmcd cowswus inmicry RATE 6. GENERAL SERVICE Appl 6cobilit;,
Escept as prowoc4 m Raic 6L this reis is opphcable to any ccmnerust md.mna! or govemmemal cunomer wd a Maaimwn Dunand of less h 1,000 lulo*a;u *ho uses the Corrpey's tier.nz serv ca bertarider for d regwemenu Dirca current rig 4rtmenu povidcJ under anomer ra.e immc6az1) pner to Scizmter 2.1975. =21 however, also be prmded bestimdet.
General Serviev - Time of Da;.
Tirne cf day charges shall appy to (!) any cusemer wis s Munum Demand of $30 Dows;u. but less than 1.CCO up stu, in arts ct the 12 menes precedeg se tu. g morte crie of.hich occun d reg oc eru monts pruedes the b l.ng mons. (2) succes cts to cusmers served urder d.ese chargas rrmed.au!y pnor to se daia of sucs ssu:m whose er.ca:cd Mainen Demands snect 3e demand stquemer.u in cisuss (1) atove. (3) ocw cunanen shots er.arna:cd Ma2.irmen Demands meet et dcmand reqa.rements in clause (1) ateve. sad (s) any.cuserner previcssly ta!'ed bemmder pm. ant to sisau (1) or Cl: cep e aber ise prmdad beJew.
These charges shall o.
= agLestle to evaiomen or seg sucerason wub electn4 ep:e huang takirs servec under the Huur wah :.sgN pimaam o,f Mer 25 pnor to November 23. 1977, L
sacept n;a wnnce s;7 ace by tr. cunomer to the Company.
If a customer at one same was semd pumans to (1) above on Geners: Servics - Tune c.f Day and has s Muime Dema 4 which has na car >< dea 23) Wo s:s in aoy men
- of the i=rJet rncm2 pemd prued r4 e.: b2l irs mcre. suc.h cssierter ensy elect, in wm.cn a;phcauen to n.se Cor pey, to be served on Genera! Servia. Oc ura! Service - Tirne of Day shall ect spin tu a;T ceMe u.Q eu::h cusicyner quaLf,ca for such raan sider the requeme.a of Ger.ern! Service - Time of Day.
h General Sen ks.
Geners) servicr cra gu e4 agly to a3 caher cuncreers qa!.fyvg for sema w4cr h na.
Chargcs.
Cencrat Senica - Time e,f Day.
Monthly Castomer Charst.
The Mordly Cusicmcr Charge shd in $19.59.
- Dcinand Charge.
Summer A!! Other Mon 4As Months 513 06 511.71 pu Wo au for d Wo.aua of Maum.an Derrard for the merah.
l Tor et insposu hertof. W Sumroer Mmme shall be the cuncmets f.m manaly tang pgned wd an cadeg encur read.ng due oc a alas J.,ne 15 aid W mres succacces trerEy tGng persaria.
- Energy Charge.
6560e'per kbowascur for d 130=snari suppbed during Peak Pe. nods.
3 Ills pr Womacour for d Womar. hart r.rgLed cLrr.g OOPeak Penodt T3 fuel adymrnent cha se er e tda prwded is ri het 20 st4 an Jy to d Gow ac. hours sepphed in ihe anoni>L Central Scevke.
- Monthly Cessuner Charge.
714 MxWy C uomer O.arge sha* be 59.35.
- Danand Charge.
Sammer A!! Other Months Month:
513 Ob S t 1.*n per up.an for d Gewsca of Manamwn Demar4 for ec enauh.
For es pwposes hereof, the surr,mer MmAs ths!! be the cunemeri first methly b.Lrg period wie an er.Les meter read.rg danc e-
.:..r June 15 arid the etse succzedeg mentJy tGng penods.
- In accoreca ed the A;pLcauen of Demand Charge pronsions of 6 rate. there sW be rio demaru' charge as such for canain rna.3 curwmers. tan in 1,cu certof. euch cuncrne s shd pay 6 4094 pr Wo ar.$ cur n Summer Monds and 5.CfTis ps Womaabour in d caher menehe m adAucn to the energy cha gu set is,Mt brJoe.
- Emere Charte.
Gowarthours Sepplied in the Mon
- 5130: pr Womar.haar for te first 30.000 470.0CD 3 tg*s pr Gower. hour fcr the re.tt..............................
(4 3 9344 pr Hower.hcsar for d over S'D.000
%/
The fuel ad u2; ment charge or credit prenWed for r Rider 20 shaU saly to a3 Wo.am sugLtd in $c mcrnh.
f fConanued or Sher Na 25)
]
Date Ef ccute: July 1.1937 Asterisk (') indicates charge Isn.ed by C. P. RX4kek Wt Preherit Peg Off;ce Sct 167, Chicago. Dunois 6M90 4
i
I dW k
,W rurrRICITY ELL c'c Ne 4 Tee the Cinn ud Wa3ei totd as sea ne w w iNa n smu Nm 4. s.s ud:
comenon=ugib Cuntag llu Pmace wi ss a Edison Cocopariy
- ud the.r-nec wsW cut.gvow urntery RATE 6. GEST _RAL SERVICE (Continued from Sheet No 24)
Lee Paymest Charge.
The late pyment charge provided for in the Tertu and Coediuocs of thu SchedWe cf Raus st4!!
under tbs case bCaimsa Charge.
The scirumum monthly charge shall be the monthly cusson,er charge For cuatemars eith detr.and treters. the average cost of elwtncaiy bertusder to say c,ceth. estlw
- M ulm aa l%arge.
3 Customee Cts ge. shall riot escwd the sum of 19 764 sed the twel ad;wi=ett pr ble=atdcur provide such gwutwd cha*gi da'! not opreau u nduce the Catemet a bd! to an amount less than the mir.cu For General Service--Time of Day custemen the nascus demud sa uy mostb shall be the batest Muinam Desud.
tabhshed durits the ped per.cau m such month Tor Creneral Sernce cutomers.tbe estimum detr.std shall te de higtnt Mr nute demud enabluh Appbeatles of Desud Charge.
- 1) shen a customer's moett!y blem attheur use The Compact shall prende 6 demar.d cette and the demand chsage shall ap; M3 blosatthour use u esumated u in escw of ten Liceeru or 2M ble=atthours, respectnely
}
demand chage would tion ortmanly apply under the Icrescits wste:n may, at be requnt ud upen prute meur renuls. be prended sitt a deca:d meter arid bdled t d A custemer sho u than 12 monta valess be teomes entitied te a der.ard me:er pner to the end of de 12conth perio enutled to a demand ceter dal! not be repred to pay neal or other wprau etarges for sech meter.
Whethes or not 6 desatd meter u inna%e?. the etage in Leu of der:. sed cla*gr als!! apply to any custo ded 2 COO temer psying nr.tal for a demand meter sa asecedase, esth the fore sad shall centicue to apply uttal the Custco.er's uw neceds 2M Lice anboun is reo sumaane c:r.t hu demarid etceeds ter blos atu to too eversuas cont).ly bier.g pnade
'Messaremest of Demud ud Kilseattaman Seppikd.
Drunuu pew! dall When two or roore retenrg instal!iuots en prended on th Custerer's prm.an,the der.ahd it p3 be deuruuned b3 add.r.g ugether t.be separsu decuh at as h zetert:s suutauet durstg such Dmi demand invier. the t!.st is)in esae the de:rstd at u) suur.ng tr.sansact u ng.suard by na h
in st) Mmituu pnad of such anonth, sed (b) the demar.d at uy mataustion c.a) be usured sected load af such cor.neeud load a reo blosaru or lens. sto such deca h d shall be deter.
thers are two of enort e atthour meurttg iua!!stiou er. de Customer's d unnanstion of the hours tusalisticr4 estved S.bCC in the bdbr.g metti ud are not meured an such a mar. net u to perma e Anrg wbsb they we= dehvend,for purposes of s;plyseg the une of day provisiou o t celaered is peak pe rods il the ese tv use st such sr.stallauen is SM blesanhoun er leu
' the bn.r.g month, a cla se of 4 021e per blowattbour Asil apply to turb blemattbours T be ecesdend to have,
bicoatthours suppbed for toc or more prerr.iaes ed! t,ot to eceb.ted for b4r.g purpona benu.tder.
Upcn request,the Ccepuy wil prende unmeured eerwee for contwted load.: set earwda h
of the Custorcer's equipment u conunveus of is regular!> nche h
10T All apprograu data) of the eor.r.ected loads by oneteelfth of the s P
n 8
(Cor.utued et Stret No 21) w Detr Ereerns.orietser ti. litt lased b G P Palsles.\\ see Prnident.
- TUed enk the bets Cacmem Cent:issies se Cet.her 16.l884 Past Of re Ses 747.Cbesgo, heu HOD lassed pensulto Order el hou CemeernDinuaise estered October 2(,1988 la Cue has BMill sad 834&31 Ca:
Asterma Ps sad.csnas chaage g
-.. ~...... ~..
--a a_:__
l I
A t 18 0 T.".Q ". t 0 i
s a
ELECTRICITY i
r, For the Cule and Ytrags ksed on
!LL C.C.Su.4 (j
Commonw ealth Eneeu hon. ( 5.6,7 and 4 R,.las shnt No. :s j
Edison Company are the memnpried cmgas ismery 1
RATE 6L. LARGE GENERAL SERVICE j
Applicablue).
This fue is applicable to (1) any cr.snmercJ. esdvstr.a!, cr gmmmend cusemer sah a Maaima Demand d 1.3)0 kilowac.s or mere en three of ce 12 rncnas preitdtg the b2hrg mone. Q) succtasors to cusumen served under dese chs ges anmed auly prim to the daz d aucassion eless utstad Muunum Demands me.et the dema.i requvemens in clause 0)
I abe. Q) ec. customen ohose estimated Maumum Dcr. ands rr. cst the demand riquettncnts m clause (1) above. ar.d (4) any customer prevanly lued hetunder purt. ara to clauca (1) or C), u:rp as cahcrw.ac ;rimded ts.iow.
If a custcrner as are tune eis served pwnuant u (1) stee on large Ocncri! Service-be d Day and has a Mur um Demand shah has ncs sacaeded DO ktlo. sus in any snon.h d the 12 mcrd pencd psced.ra the bcLng mant such cusicrner may
(
elect. ss enuen appLcat,m to the Cu rpany, no be served on Rau 6, Ocncra! Semce. Raw 6U Large Gereral ServwTune i
d Cay, sNa3 ncs again tz a;T) cable und! such cusu: rect paLf3cs for such rue mder cWm (1) stova.
TN La ge Ocneral Semce-Heai with Ught che gu shc be apphenth only to cusurners or their euccesson =d eJactnc s;sce beaug tate.g arrvs under the Heaes esth Laght provuions of R, der 23 pnce to Wmnber 23.19W.
A b ge Gcnval Smics.. Heat we Ught cusen er *;:1 he aco-ed to tal: La ge Ocneral Service-Tene d Day semca span vnuza a;pi.cenan to.w Capay. Once changed to large Ocncrt! Scrvac-Tene d Day semce those cusemen or ter suctemn :J eat be Go. d to ruwm to Large Genenj Semce-Hea: we Ug%
Chargts.
Large General Senict-Time of Dsf.
- Monthi,5 Cusic,mer Chargt h MenWy Cmemer O.4 ge shd t4 $$47.06
- Dcmand Charge.
KJ1owatts cf Snamer M Other Maximum Demand Monms Manos fcr the Month 51106 til.n pr uo.au for ce fest 10.3I) 635 5 06 per uo.aa for au mr 10.000 For ce purposea hertof the Summer Marths that te the custcnner's fiet meedJy baLrg pna.ith an endeg incar read.ng dau cc or star June 15 and the ihree sucumug mathh tCes pnodt
- Energy'C%arge.
65%: per Up.adcur for c h2owethoun sqLed donng Ptd Peneds I
3 Illt,pr Ucmanhour for a huo.acha.n s.ir%cd d.vr: C? Peak Pinoda The fscJ adge:n.cni cws: cr cres'a tro.M for m Rader M shd a;py to a: tu icoun r.rspLed m W man:A
!. arse General Servict Heat =12. IJght.,
- Monthl; Customer Charge.
h Mmely Caswmer O.arge that be 1347.06
- Demand Chargt kremer M Other Moc hs Manoes 11106 311.T7 per Co.att fcr aD Go+sas of Maume Demand for the incrt:h.
For the ruposu hereef. me S ~.mer Manths tha2 be the csitcenc s fim mor2Jy PLng pncnd *d an endes meter reabs e
date m er afar la 15 and ce erte eucceed.r:: rnwdJy turg pava-
- Energf Chargs.
IGc es:thours
$spphed in tre Month ilm pr Wo.athair for the fint 30.000 3 957 e pr Howathour for the roi................................. 470.000 3 934: p r uo ar.haur fcr a:: over................................
500.3"O The fad adpsoncnt ct.a go cr endit provided fw s3 Pader 20 shad spply to 63 Wo.adoun suppLt.d in the rncrith (Cori naed cri Shees b 29)
Date TEecibe: July L 1987 AsterLak (*) indicates change Imusd by C. P. RJfdes. Vict Prasident.
Tos CCee Sc,3 7g7, Ctkago,1&noss 60090 n
J l
/'
f
}-
d L1.rcT31CrTY I
1 Tor the Cit; and m. age tised on ILL.C.C.No,d-
)
Conss+casrealth shesu Nos. d.1, E,7 and 8
- Lrt Rensed Shn No. 29 E4hoo Company ar.d ta ir.itco,onad umstuous umwry (Caect.T rg :De Revust Skic No 09)
)
RATE 6L LARGE GE.NER.U., SERVICE i
(condus4 frn Sheen No 13) late Payment Charge.
N 1am pymeru charge provids4 for m 6: Tsim a3d Cmdecms of sh $ dad.Js of Rama d.C be ap%ubis u d chargs:
modst eUs rs.t.
>0nimwm Charge.
W mess.un manc.') d.a g d4 be es metJy c nanar charge.
Ma.cf mina Ch ge..
N antage som d eJacmeiry bermander m ery mord. ac14sive of es MmfJy Cur.amcr O.a ge, sbd nos unud d.e sam d 19.7 6s ard os fael eeus= rent pr uo.subcur p ovidad, to.svar dat such g.ararw.ad cla ts she sea opna u seAce es Chsase's 10 no na securu less than pm tr.ds.sn c!.arge.
- Mudmum Demand Eacsps as nmad in de parig-sp talte.. O enuitman deand in ary mm* iM ts es hightn % minuu der and I
nr.ablish:4 due.c3 es puk pencs s in rah cur.h sacr;s est for narwreen miA 30.tr.ina demeda ucatdig 1.5"O harmazu in thrte of the 12 rods p tades the tCes mmA. es tranrain de-ed shalt ts se *s igc cf es thtts tJghest 30 mmute dcmeds tr.abbhte da-eg es peal priods m sus mmA. est mers thaa cre sua dmand to be salsed fran any con day.
l Tur cartamere tal*eg service under Large Ocre-d $mics - Huurg wis Light paavisicrt of $is riu As rnsL tn demat:d l
l ahd ts the h.ghert 33rcinuu demar.d esatbhad at ary time dareg such mons ucr;s bi for cuswrws ed 30.me.;a l
demands escac4eg 1.500 Mc atu in 0.rts of es 12 mones prica4c3 On t@rg mers, se tratirr.rn de'.ed sha'J Le de avrigt of the dru Qhest demeda u;.at.*ahr.d dere4 its encrh., ses mort thaa ec.a rue dcme>d to be seier.s.4 from sey era day.
Mamrurvenant of Demand and Dowatthours Suppliac1.
Whers two or coort me areg ins.af aams art provided ce the Cusemer's penius. de dmand in ary 30 mines priod sha.J te deurmined try addes est$st h orgme devants a us.h er,cavg inscLon d. reg rus 30-mmuta penad su.r; j
thu (s) to uns se damnad u any incenrg ire.cason la regined t.y an ed.udng or ch.m4a.ive de-.e4 rr. ster, es I
scr%nd at rum irs.Albtion in un M.cnmuu pnod ci ary rcer.2 shall ts usstad u ts the wne as Os tJg*tst de-ed k, try Memuu priod d ruc.h snanA and (b) Os dernand at ary inr.csson may is ass.r-e4 no ts 75 precnt d es sorce. cud bd if such acc.recud bd is two Womeu or Icss, and sah doned is to la addt4 to a meurtd dmand. Whe t l
then an ste er esors maescs.;r snetareg innar.adens ihe Uc a: sown rgs4 shd te detrmined ty addeg tegeAct ce Comar.bwn citared at tac brar.as.m. pendad es: obes the Mc=st.hown a any mah irs.Caton excand !.!00 in the tat ng esord and an not meur:4 in sah e cants: na to per a deurmesson of es locn dreg abr.h they sure deLvert4, for parposes of a;p)eg Os L.ms ofd.sy yovisions of this nu. tur.h WasstAcan shd ts considr'ad to have tsen ddesrid in peak pncsfa. If du ers p sie at ruch ars.Ca* son u 5.500 Grosdoun or less in the 40:cg mar A. a charge of d C:1s pr 1.;; oms:2.o.: sw apply se rnh up.a:$curi. The mi.timara dr.rnands and Rosar. hours serped for swo or snart p=s: su wdl em be scenbeed far tCeg p.rposu hertunder.
L'pcm seqsert es Correpary wC) pavide unrnacrn! serviar for emnteud bd set orat4rg two Keesu shen rprium of I
the Cisncrner's squg-ncns is core nuous or is ngular*y scheda'ad on an annual buis, Fcr es purposa of tCes m exh susca. Os snoctNy Const$oun shd te dearmoed ty ard.:ptyirs es nad manage (based opcri osm;'au or o>er appropeise daa) af scrmaasd Icsis by one evi.1hh of the areval bourt of opm and d.vsdor: try 1.E.
All Uceschours dr.Lnrad to an urmetered poun of arpp?y thd be c.ans;dend to have tse dcLver:4 dereg pan pnada, a eHcs Taduses A mandard inr:d.sJon furrjes.d by se Compary hereunder shd be deur tir's4 t.y $s p ovisions of 4: Ccrnpary's R.4 der 6 sacup est the fat:nse se prov.ded se san.dard shd te adcilasa crJy to r.;py se*vice is e bd sqaa! in es murwn 34 mewu demand c.f the Custamar esubl.sh:4 darias Se p.a1 pnc4 If largte facLUta are nqst4 a serve the escris of es l
eff.pd dcmand ovat es pd deed $e Caswmar shd pay, as opuanal faches is ac.co dece wnh Vs Co rfany's j
Rider 6. et cost of any fack.its so requin4 Howevre, no arsonal Isches sharges ahd apply to fart. bias esacrg and ki pleas e ibe t.nu ou Cuncreer gaalt.m for eerdes beimdar d
(cme.s4 m sheet No 30)
Flhed wt;.h use tainois Csmmerce Commmon ce Cuces 17,19&4 Date L"ews: Decet,e L 1936 AnwIsh (*)iMUc2 tan changa f.srued tJ C. P. RfaLe5 %rv Pres df%
l Post C2ct Ben 767, CMcago. Chacu M690 L
=
.w w,.
- a;-
~; T 3
'_ _ w : _ _ _ _ _
s L"
i Attechrent D The amount of the credit which is to be made in respect of either Byron II or Braidwood I Unit if it =eets the criteria for capacity guarantee credits set forth in Paragraph 5 of the Memorandum of Understanding shall be deter =ined by making the calculations described below, A.
Fro: the aggregate amount of fixed fees paid pursuant to Paragraph 5 of the Me=orandum of Understanding there shall be subtracted the aggregate amount of credits made pursuant to that Paragraph (net of the aggregate amount of Edison's share of the shared savings).
B.
The result of the calculation made under paragraph A shall be multiplied by 0.35.
C. ~'The result of the calculation made under paragrap,h B shall be multiplied by a fraction, the numerator of which is the difference' in gigawatthours between the cu=ulative actual output of the Unit as of June 30, 1992, and 25,274 ar.d the danc=inator of which is 25,274.
This calculation in paragraph C shall l
be made. separately for Byron II and Braidwood I.
The result of the calculation cade pursuant to paragraph C shall be the amount of the credit; provided that in no event shall the
(,,
cum of the credits made under this provision and the aggregate
t i,
('I amount of credits made pursuant to the output Guarantee in Para-graph 5 of the Me=orandum of Understanding exceed the aggregate amount of fixed fees paid pursuant to Paragraph 5.
i l
i
?
i 9
9 9
O,- * * ~ _.
g n
I..
ry a
e f
Attachrent E "Most Favored Nations",
During the 20-year period June 30, 1992 through June 30, 2012 Edison under option (a) in Paragraph 5 shall have the rights set forth in paragraphs (A) and (B) below.
(A)
If Edison is purchasing power under a Contract with the Subsidiary (" Pre-Existing Edison contract") and the subsidiary enters into a contract to sell power to a Third Party (" Third Party Contract") which is comparable to the Pre-Existing Edison contract, but contains more favorable prices or pay =ent terns, Edison may elect to have the price and payment ter=s of the Third Party Contract substituted for the prices and payment ter s cf the Pre-Existing Edison Contract.
A Third Party Contract shall be censidered to.be "co= parable" only if:
I.
It is effective over approxinately the sa:e calen-1 l
dar ti=e period as the Pre-Existing Edison Contraco.
II.
Any other difference between the ter=s and condi-b tions of the Third Party Contract (excluding price and pay =ent terms) and those of the Pre-Existing Edison Contract does not significantly affect (i) the subsidiary's cost of providing ser-vice, (ii) the quantity or type of service to be provided, (iii)
I the benefits obtained by the Subsidiary, or (iv) the risks under-l taken by the Subsidiary.
Edison shall have no right to substitute only the price (n.
Er pay =ent terms of the Third Party Contract for those of the Pre-
%s
F-~,1
.k,s 1:
Existing _ Edison Contract, it being understood that Edison's elec-tion under this paragraph is limited to substitution of both the payment And price terms of the Third Party Contract for those of the Pre-Existing Contract.
B.
If the Subsidiary enters into a Third Party Con-tract'and Edison advises Subsidiary that it desires to purchase
. power under a co: parable contract, the subsidiary will offer power to Edison under a comparable contract, if such power is available from the Units.
For purposes of this paragraph, a contract will be considered'to be_co: parable to the Third Party contract only if its terns and conditions are materially the same as those of such i
Third Party Contract excepting only such ter:s and conditions as do not significantly affect (1) the Subsidiary's cost of providing service, (ii) the quantity or type of service to be provided, (iii) tha a=ounts, form and timing of pay =ents, (1v) the benefits obtained by the Subsidiary or (v) the risks undertaken by the j
Subsidiary.
No such corparable contract shall rel,ieve Edison of any of its obligations under any Pre-Existing Edison Contract.
Upon the execution of any Third Party Contract, the Subsidiary will give Edison notice of sa=e and furnish copy of same to Edison within 30 days of the execution of said Third Party Contract.
' k,,. J
l fus*
.%)
FACILITIES TPANSFER AGFIEXENT C ::enwealth Edison Cc:pany ("Idisen") and
(" Subsidiary") hereby agree as fellows:
1.
.The conveyance of facilities which is the subject of this. Agreement takes place in 1 ple:entatien-of a Mescrandum of Understanding a=cng C ::enwealth Edison Ce:pany, the G: verner of
'the State of Illinois, the Attorney General of the State of Illinois, the State's Attorney of Cock County, the Governor's office of Censurer Services, the Small Business Utility Adv0: ate, and certain industrial custerers of C0==:nvealth Edison C: pany who are party interveners in a proceeding befcre the 212incis C ::erce C : ission bearing the De=ket No. 86-0249.
The Xe ::andum of Understanding entered into by the above parties centemplates the settic ent of a variety of centested proceedings before the Illinois C ::erce'CO: ission and the courts in which
,1 the continued constructic~n of Braidw Od Unit 2 is at issue as well as the rates which Edisen will charge.
The agree:ent cente= plates the conveyance of the facilities commonly kn wn as Byron Unit 2 and Braidw cd Units 1 and 2 (cc11ectively, the " Units") to Subsidiary.
Subsidiary's rates vill be regulated by the Federal Inergy Regulatory C :=ission.
A rate increase of approximately l
13% in Edisen's retail base rates with a five-year =cratorius en rate increases thereafter is also provided for.
Accordingly, Idison vill convey the Units to Subsidiary.
The real estate and
+. -
facilities constituting the Units are sore particularly described Exhibit B
i ks in Appendix 1.
The conveyance shall be effective as of July l',
1987, or such later date as =ay be.specified by Edison.
In the caseofBfronUnit2suchconveyanceshallincludeaneasement for-I the continued operation _and maintenance of that Unit on the Byron Station Site described in Appendix 1.
2.
The conveyance vill be evidenced by suitable quitclaim deeds and such bills of sale and other documents as Subsidiary nay reasonably require.
Where appropriate, such
' documents'shall reflect the fact that the Units are and will remain subject to the lien of the =ortgage securing Edison's first nortgage bonds.
Such conveyance shall be subject to a reservation to Edison of such rights as may be necessary or appropriate, to enable Edison, as an NRC licensee, to co= ply with all NRC requirements, including the authority to exclude persons frc= the premises conveyed to subsidiary so as to meet NRC security, energency planning and radiation protection requirements as described in Section 2.1 of the Safety Evaluation Report issued by the Nuclear Regulatory Commission ("NRC") for Byron dated February, 1982, and the Safety Evaluation Report for Braidwood dated Dece=ber, 1983.
Such conveyance shall also be subject to a reservation to Idicon of such rights as may be necessary or
,3, appropriate to enable Edison to continue to operate and raintain facilities on the Draidwood Station Site described in Appendix 1, which will not be conveyed to Subsidiary.
3.
Edison will take such steps as are necessary (including seeking any required NRC approval or consent) to amend t
. P45 s#
or transfer its NRC licenses to Subsidiary to the extent such amendeent or transfer is necessary to give Subsidiary title to the Units, the right to complete construction thereof or the right to I
operate the Units through Edison as its agent and sell electric power generated by the Units.
Edison will provide the NRC with such assurances and guarantees as it may require in connection j
with the conveyance of the Units to Subsidiary.
Edison recognizes that the NRC nay require that Edison be a primary obliger with respect to certain of subsidiary's obligations and liabilities arising out of. construction, ownership or operation of the Units.
Edison will transfer any other licenses or per=its relating to the Units, where necessary to enable subsidiary to co:plete construction of the Units, operate the= or sell power therefrem.
4.
Ai valoren property taxes applicabic to either the Byron Station Site and the facilities thereon or the Braidwood Station Site and the facilities thereon shall be allocated between the parties so that each bears an amount thereof in proportion to its investment in the station in question.
Subsidiary shall also be liable for 50% of such taxes allocable to Byron Station con =cn plant.
Ad valoren property taxes for 1987 shall be prorated to the date of the conveyance.
5.
This Agree:ent shall beco=e effective when Edison notifies subsidiary that all governmental approvals and actions required by the terms of the Memorandu: of Understanding between Edison and various other parties, dated February 3, 1987, have been obtained or waived by Edison.
Nothing contained herein shall
([y be construed as permitting Edisen to waive approval by the 5 1
f
~
' Illinois Co=erce Co=ission of this-Agree =ent or any other avsee-I ment between Subsidiary-and Edison, 6.
This Agree:ent is subject to approval by the
\\
Illinois ~ Co=erce Co=ission and shall only becor.e ef fective upen such approval.
i 1987.
iExecuted this day of COMMONWEALTH EDISON COMPANY By:
Its:
i (SUBSIDIARY)
By:
Its:
{
44
- g a -,
e i:
-1.
Parcel 11-TR's D $425183, Recorded 5-11-73, BK277, PG320 Parcel 13 WD # 4 2 5179, Recorded 5-11-73, BK277, PG316 Parcel 14 WD $422159, Recorded 1-15-73, BK276, PG73 Parcel 15 WD $422158, Recorded 1-15-73, BK276, PG72
~
Parcel'19 WD#456182, Recorded 6-21-73, BK277, PG774 QCD #426183, Recorded 6-21-73, BK277, PG776 Parcel 21-TR's D $431590, Recorded 3-15-74, BK279, PG785 Parcel 22 WD (423572, Recorded 3-12-73, BK276,.PG750 Parcel 23 WD $426439, Recorded'7-2-73, BK277, PG900 Parcel 24
.QCD $430565, Recorded 1-24-74, BK279, PG284 Parcel 25 4
WD in TR $423087, Recorded 2-22-73, BK276, PG493
[
Parcel 26 WD in TR $423086, Recorded 2-22-73, BK276, PG491
. Parcel 27 WD in TR $424181, Recorded 4-3-73, BK276, PG1048 Parcel 28 TR's D #459784, Recorded 7-6-77, BK288, PG650 I
k i
Parcel 29 WD'#462001, Recorded 9-21-77, BK289, PG198 Parcel 30 t
WD #469580, Recorded.6-21-78, BK291, PG72 Parcel 31 i
I TR's D #439779, Recorded 4-17-75, BK282, PG669 Parcel 32 WD #433435, Recorded 5-31-74, BK280, PG444 Parcel 32-1 WD #454954, Recorded 1-13-77, BK287, PG255 Parcel 33 TR's D #453474, Recorded 11-18-76, BK286, PG900 1
l Parcel 1RR (Railroad)
WD #437173, Recorded 11-22-74, BK281, PG924 I
Parcel 2RR WD < # 4 3'8 600, Recorded 2-14-75, BK282, PG256 Parcel 3RR WD #434263, Recorded,7-3-74, BK280, PG833 Parcels 4RR, 4RRA, and 4RRB WD in TR $431897, Recorded 4-1-74, BK279, PG909 WD in TR #431899, Recorded 4-1-74, BK279, PG913 TR's D #443723, Recorded 10-21-75, BK283, PG938 Parcel 5RR WD #436961, Recorded 11-32-74, BK281, PG862 Parcel 6RR WD (433434, Recorded 5-31-74, BK280, PG442 Parcel 7RR WD $437753, Recorded 12-31-74, BK281, PG1149 QCD #437754, Recorded 12-31-74, BK281, PG1151 Parcels BRR, BRRA, and ERRB WD #436594, Recorded 10-24-74, BK281, PG711 QCD #436595, Recorded 10-24-74, BK281, PG713 WD in TR $436596, Recorded 10-24-74, BK281, PG715 Parcels 9RR and 9RRA WD #438239, Recorded 1-23-75, BK282, PG145 QCD $438240, Recorded 1-23-75, BK282, PG147 WD in TR #438238, Recorded 1-23-75, BK282, PG143 Parcels 10RR, 10RRA, and 10RRB TR's D #436593, Recorded 10-24-74, BK281, PG709 WD in TR #431560, Recorded 3-14-74, BK279, PG771 Parcel 11RR WD #436592, Recorded 10-24-74, BK281, PG708 Parcel 12RR QCD #502362, Recorded 7-1-82, BK299, PG111-115 As used herein, the "Braidwood Station Site" is the land 2.
conveyed by the following deeds:
Parcel 1 Special WD #R73-33682, Recorded 11-7-73, Will County Parcel 2 and Parcel 1 Corridor Special WD #R75-04282, Recorded 2-21-75, Will County QCD WR75-07989, Recorded 4-9-75, Will County Parcel 3 g:-< ;WD tR73-00389, Recorded 1-4-73, Will County Parcel 4 QCD #R73-00320, Recorded 1-4-73, Will County QCD #R73-00321, Recorded 1-4-73, Will County QCD $R73-00322, Recorded 1-4-73, Will County QCD #R73-00323, Recorded 1-4-73, Will County WD $R76-06641, Re:Orded 3-11-76, Will County
y e
~
s e r i
j s
\\'
Pareci 5
, Ceurt order $R75-26232, Recorded 9-30-75, Will County l QCD WR76-12112, Recorded 4-28-76, Will County Parcels 6 and 7 WD $R73-32465, Recorded 10-25-73, Will County
', ' WD'#R73-32466, Recorded 10-25-73, Will County WD WR73-32467, Recorded 10-25-73, Will County Parcel 7-1 WD AR77-29452, Recorded B-12-77, Will County
. Parcel 8 ND $R74-28701, Recorded 11-18-74, Will County Parcel 9 4' i TR's D $R76-11403, Recorded 4-22-76, Will County Parcel 10 3
.J !,
TR's D $R74-10641, Recorded 5-9-74, Will County
~
(
Parcel 11 TR's D $R74-02647, Recorded 2-1-74, Will County Li
' Parcel 12 Special WD #R74-10086, Rec 0rded 5-3-74, Will County Parcel 13 QCD $R73-09343, Recorded 4-4-73, Will County Parcel 14 Special WD (R73-12394, Recorded 5-2-73, Will County Parcels 15, 16 and 3B Special WD #73-11350, Recorded 11-8-73, Kankakee County Parcel 17 Special WD $R74-10087, Recorded 5-3-74, Will County Parcel 18 WD $R72-33692, Recorded 11-16-72, Will County
~5-
Parcel 19 WD $R73-12393, Re:orded 5-2-73, Will County J
Parcel 20 i
WD $R73-28751, Recorded 9-20-73, Will County j
Parcel 21 TR's D $R75-000787, Recorded 1-10-75, Will County Parcel 22 WD #R75-13721,- Recorded 6-6-75, Will County Parcel 23 WD #238349, Recorded 4-17-75, BK328, PG787, Grundy Ccunty Parcel 24 WD $239424, Recorded 6-26-75, BK329, PG260, Grundy County Parcel 25 WD #247760, Recorded 1-27-77, BK342, PG610, Grundy County Parcel 25-1 Railroad Spur Title in Trust 45553, CT&T Co.
Parcel 25-2 QCD $250782s Recorded 8-1-77, BK350, PG455, Grundy County Parcel 26 Title in Trust 45553, CT&T Co.
Parcel 27
- ?D #73-4771, Recorded 5-25-73, Kankakee County QCD $73-4774, Recorded 5-25-73, Kankakee County QCD $73-4775, Recorded 5-25-73, Kankakee County QCD #73-4776, Recorded 5-25-73, Kankakee County QCD $73-4777, Recorded 5-25-73, Kankakee County QCD $73-4778, Recorded 5-25-73, Kankakee County WD $73-4779, Recorded 5-25-73, Kankakee County WD $73-4780, Reccrded 5-25-73, Kankakee County WD $73-4781, Recorded 5-25-73, Kankakee County QCD #73-4782, Re:orded 5-25-73, Kankakee County Parcel 28 WD #73-7 6, Recorded 1-4-73, Kankakee County L
Parcel 29 WD #72-10952, Recorded 11-17-72, Kankakee County Parcel 30 WD #72-10954, Recorded 11-17-72, Kankakee County Parcel 31 WD #73-2911, Recorded 4-4-73, Kankakee County Parcel 32 WD #73-772, Recorded 1-26-73, Kankakee County Parcel 33 WD $72-6651, ~ Recorded 7-26-72, Kankakee County
^
Parcel 34 WD #73-75, Recorded 1-4-73, Kankakee County Parcel 35 Recorded 10-3-72, Kankakee County WD $72-9224, Parcel 36 WD #72-9223, Recorded 10-3-72, Kankakee County.
Parcel 37 Recorded 2-24-75, Kankakee County special WD #75-1247, Parcel 39 Conservator's Deed $73-5184, Recorded 6-4-73,-Kankakee County Parcel 2 Coz.idor TR's D #R76-16535, Recorded 6-3-76, Will County Parcel 3 Corridor WD #R73-31738, Recorded 10-18-73, Will County i...
I Parcel 4 Corridor WD W R7 3-3 60 6 2., Recorded 12-6-73, Will County
{
- Parcel 5 Corridor WD #R74-01538, Recorded 1-18-74, Will County Parcel 6 Corridor Easement - See Braidwood - Wilton Center R/W, Parcel 6 Parcel 7 Corridor WD tR73-26439, Recorded 8-29-73, Will County QCD WR73-26440, Recorded 6-29-73, Will County Parcel 8 Corridor WD #R74-02644, Recorded 2-1-74, Will County Parcel 9 Corridor
'WD #R74-21461, Recorded 8-29-74, Will County Parcel 10 Corridor WD $R75-07305, Recorded 4-1-75, Will County Parcel 11 Corridor TR's D $R75-07303, Recorded 4-1-75, Will County Parcel 12 Corridor TR's D (RB2-06274, Recorded 3-29-82, Will County 3.
Edison will grant subsidiary an easement in the Byron Station Site for the purpose of (i) operating and maintaining the Byrc Unit 2 generating facility, including any needed replacements, modifications, additions, retrofits or similar improvements to the equip =ent and structures constituting Byron Unit 2, and (ii) making such use of the Byron Station Site as is appropriate in connection with the retirement end
~8-
deco==issioning of such equipnent and structures.
4.
The facilities and structures which constitute the Byron Unit 2 generating facility include the Byron Unit 2 f
a.
Reactor Containment b.
Reactor Vessel c.
Reactor internals including control rod drive nechanis=s, instru=entation and detectors, pressurizers and steam generator including separator and dryer, d.
Cranes and Hoists used solely in connection Vith operation of the Unit e.
Main and Misc. Instrument and Control Panels f.
Piping, including valves and supports used solely in connection with operation of the Unit g.
Circulating Water Pumps used solely in connection with cperation of the Unit h.
Turbine (including foundation) 1.
Generator (including foundation)
.j.
Condenser k.
345 KV. Main Power Disconnect Switch (1/2 interest) 1.
Natural Draft Cooling Tower Such facilities and structures also include any other facility or structure at the Byron Station Site which (i) was designed, constructed or installed pri=arily for use in connection with the operation of Byron Unit 2, and (ii) in the case of any such facility through which electricity generated by Byron Unit 2 flows (together with the structures which support such facility), is located in the system at or prior to the points designated A on the attached diagram.
5.
Edison will convey the,Braidwood Station Site to Subsidiary subject to the reservations contained in paragraph 2 of j
the Facilities Transfer Agree =ent between Edison and Subsidiary together with all equipment, structures, inventories, caterials
_9
4 and supplies located er stored thereon except the transmissien facilities.
As used herein " transmission facilities" means any equipment through which electricity generated by Braidwood Unit i f or Braidwood Unit 2 flows (together with the structures which support such facilities) which is located in the syste after both of the points designated A on the attached diagra=.
9 sp,y:,; -
7.
e
'O 4
.' g e
0 ee e e me..m o e mesmo e.
.aus e es>e
. ems e*
em.
.e o.--
em e ee
'.h
.ame.m o
e e
.D
' G epB D
ee 4
a>
e D
N 8G #
emWD eBM 4W 66 e
- m 6
er e asum m a.
se e4 g
.e
+
(M)
{
m I I4i d2d SDk M F &'
A
/2 4 d 7 [ C TT /.' f l'em.
( E)
M)
Vu iT Ao*..
0
~
a c ts ** G s
( r. A A s (O
9 f
O e
m.,
a 9
y
.e amimum ms.amesume e e. eim....ms.
...,e
~*.e=.
e e
en m.
. e. as o..
e 4eo
--. asp emmam e eens ese--
'ddresb ee amee e=
- a gumm.
ammeus. ammesm-. y e
.*me e
mme,.
e es ens ese emme e p. e m. e-aim.
e e
em. *
- e t
i J..
9 Wae pIAgpAg 9M 46.
m r
e.
. S
POWER SUPPLY AGREEMENT BETWEEN
[ SUBSIDIARY)
AND CO}O!ONWEALTH EDISON COMPANY
'This Power Supply Agreement (" Agreement"), made and entered into this day of 1987, by and between
[ Subsidiary), ("[ Subsidiary)"), and CO!OiONWEALTH EDISON COMPANY,
(" Edison"),
WITNESSETH:
WHERIAS, (Subsidiary) shall own certain electric generating units commonly known as. Byron Unit 2, Braidwood Unit 1 and Braidwood Unit 2 (the " Units"); and WHEREAS, Edison is a public utility engaged in, among other businesses, the~ generation purchase, transmission, distri-e "bution and sale of electric power and energy at wholesale and
{
retail; and WHERIAS, (Subsidiary) has agreed to sell to Edison power and energy available to [ Subsidiary) from the Units, and Edison has agreed to join with.[ Subsidiary) in executing an agreement that will set forth in detail the_ terms and conditions for the sale of such power and energy by (Subsidiary) to Edison; and WHEREAS, Byron Unit 2 and Braidwood Unit 1 are expected to be placed in service on or before July 1, 1987; 9
Exhibit C
NOW, THEREFORE, [ Subsidiary) and Edison, in consider-ation of the premises and the mutual agreements contained herein, which each of the parties hereto acknowledges to be sufficient consideration, agree as follows:
ARTICLE I TERM OF AGREEMINT 1.1 ' EFFECTIVE DATE.
The Effective Date of this Agreement shall be July 1, 1987.
1.2 TERM.
This Agreement will have an Initial Term beginning on the Effective Date hereof continuing through and including June 30, 1992.
The Initial Term of this Agreement is subject to extension pursuant to the provisions of_Section.5.4 of this Agreement.
The parties recognize that the date for exercise of the option relative to Braidwood 2 capacity provided in subparagraph (ii) of Section 5.3 hereof falls outside such Initial Term, but nevertheless survives.
ARTICLE II UNIT CAPACITY SALE AND RESERVE RESPONSIBILITY i
i 2.1 UNIT CAPACITY SALE ~.
During the Initial Term of this Agreement (and any extension of such Initial Term pursuant to Section 5.4 of this Agreement), (Subsidiary] shall make available to Edison all the power and energy available from each of the Units from time to time and at any time for Edison's own use or resale to others.,
2.2 : RESERVE RESPONSIBILITY.. The sale by [ Subsidiary) to Edison of the output of the Units pursuant to Section 2.1 is a sale without generating capacity reserves.
ARTICLE III
' POINTS OF DELIVERY 3.1 POINTS OF-DELIVIRY.
Edison shall receive and take' title to power and energy produced at each Unit at the point of interconnection between the Unit and Edison's facilities.
ARTICLE IV CHARGES FOR SERVICE 4.1 RESERVATION CHARGE.
During the Initial Term of this Agreement (and any extension of such Initial Term pursuant to Section 5.4 of this Agreement), Edison shall pay'[ Subsidiary) a base monthly reservation charge of $55,000,000 beginning with the bill for July, 1987.
Such base monthly reservation charge shall be subject to in. crease as provided in Section 5.4 of this Agreement.
4'. 2 ENERGY CHARGES.
For each kilowatthour of energy delivered to Edison hereunder in any =onth Edison shall pay [ Subsidiary) the cost of fuel (including applicable costs of leased nuclear fuel) incurred in such month to produce the energy purch==ed by Edison, such cost of fuel to be calculated in a manner consistent with the provisions of Edison's. Illinois Com=erce Commission (*ICC") fuel adjustment clause.
If, in any of the periods listed on the table set forth below,
.[ Subsidiary) produces energy from the Units in excess of f 4
u 110% of the target level for such period listed on such table I
(" Bonus Energy"), Edison shall also pay [ Subsidiary) an.
amount determined in accordance with the following formula:
1/2 (S - C)
+C, i
where:
S=
the savings deemed to result from the production of Bonus Energy; and
- C=
amounts previously credited by Edison to retail ratepayers pursuant to the " Output Guarantee" provisions of Paragraph 5 of the Memorandum of Understanding dated February 3, 1987, between Edison and certain other parties (the " Memorandum of Understanding"), and not previously considered in determining compensa-tion for Bonus Energy or S, which-ever shall be less.
In determining whether (Subsidiary) has become entitled to compensation for Bonus Energy, all energy output for any period listed on the table set forth below up to the target level for such period shall be considered normal output and only when [ Subsidiary) has produced energy from the Units in such period'in excess of 110% of-the target level for such period shall (Subsidiary) become eligible for Bonus Energy compensation.
W l
TAPGET LEVELS Period Cunulative Eeriod Gioawatthours Gioavatthours
(
I July-Dec 1987 6,000 6,000 1988 11,000 17,000 1989 13,200 30,200 1990 16,100 46,300 1991 18,000 64,300 Jan-June 1992 7,550 71,850
~The savings dee=ed to be~ realized by Edison fro;u the production of Bonus Energy shall be the difference between i
the fuel cost incurred by (Subsidiary) in producir.g Bonus Energy and the cost Edison would have incurred in replacing such Bonus Energy.
Edison, in conformity to the-Menorandum of Understanding, shall determine the value of such rep 1' ace-l ment power.
The additional Bonus Energy co:pensation to which [ Subsidiary] =ay be entitled shall be determined no later,than 30 days following the end of the period to which such Bonus Energy compensation relates.
Any such Bonus Energy co=pensation shall be billed to Edison in equal
=onthly installments over the 12 =enths succeeding the month in which such determination is made.
4.3. FIRM RATES.
The rates for service specified herein, as they may be increased as expressly provided for in Section 5.4, shall re=ain in effect C ring the Initial Term of this Agrea=ent and any extension thereof pursuant to Section 5.4, and shall not be subject to change through application to the Federal Energy Regulatory Con =ission ("FERC") pursuant to the provisions of Section 205 of the Federal Power Act absent the Similarly, the pricing agreement of the parties hereto.
mechanisms specified in Article V shall not be subject to change through application to the FERC pursuant to such provisions of the Federal Power Act.
ARTICLE V OPTIONS Edison shall have the options specified 5.1 EXERCISE OF OPTIONS.
5.3 and 5.4 below to purchase power and in Sections 5.2, energy from [ Subsidiary) after the Initial Term of this Except as otherwise provide.d in Section 5.4 Agreement.
below, each such option is exclusive of the others, and the option selected by Edison must be exercised by Edison no 1991.
later than the close of business, Monday, July 1, 5.2 MOST FAVORED NATION STATUS (Option a).
During the period June 30, 1992, through June 30, 2012, Edison =ay purchase power and energy from [ Subsidiary) produced from the Units, when and as available from the Units and subject to prior sale to others, at any time and from time to time at prices subject to the jurisdiction of the TERC but subject to Edison's rights described in Appendix A to this Agreement.
Nothing contained in this Section 5.2 shall be dee=ed to
. deprive the ICC of any authority it may have to approve
,_ contracts for the purchase of such power and energy or to If the TERC is review the prudence of such purchases.
without or disclaims jurisdiction with respect to the rates at which such sales are to be made by (subsidiary) to Edison, the rates agreed upon by the parties shall be submirted to the ICC for review under Section 7-101 of the Illinois Public Utilities Act and the rates agreed upon by the parties, as shall be the they may be modified by the ICC upon review, basis upon which Edison shall cc=pensate (Subsidiary).
5.3 NEW AGREEMINT (Option b).
(i) Edison shall have the option to contract with [ Subsidiary) to purchase not less than the entire output of Byron Unit 2 for the remainder of its useful life and, if it does so, to also purchase such arount of power (in blocks of 100 megawatts) from Braidwood Unit 1 over the re=ainder of its useful life as Edison shall designate at the time of exercise of this option.
If Edison elects to purchase any amounts of power from Braidwood Unit 1 pursuant to,this Section 5.3, Edison shall have the further option to that reduce the amounts of power (in blocks of 100 regawatts)
Edison is obligated to purchase from Braidwood Unit 1, any such reduction to be effective on July 1, 1997 or, if Edison has previously exercised the option provided for in Section 5.4 of this Agreement, effective on July 1, 2000, in either case by giving notice of such reduction 12 months prior to l
Edison shall purchase such power, and such effective date.
the energy associated therewith, at rater datermined using traditional net original cost rate base / rate of return regulation and accounting for fuel and all other costs of production, all as determined by the FERC from time to time.
If the FIRC is without or disclaims jurisdiction with respect i
to such rates, or declines to make such a net original cost rate base / rate of return deter =ination, such determination as made by Edison and (Subsidiary) shall be submitted to the ICC for review under Section 7-101 of the Public Utilities Act, and the determination of the parties, as it may be modified j
by the ICC upon such review, shall be the basis upon which Edison shall pay [ Subsidiary).
In the event that Edison exercises its option to reduce its purchases from Braidwood Unit 1, the amount payable to [ Subsidiary) shall be reduced to reflect such reduction effective as of the date of such reduction.
(ii) If Edison has elected to purchase the output of Byron Unit 2 and at least a part of the output of Braidwood Unit 1 under this Section and has not elected to reduce the amount of power produced by Braidwood Unit 1 to be purchased under this section, Edison shall have the further option to elect on December 1, 1998, to purchase not less than the entire output of Braidwood Unit 2 during the period January 1, 2000 through the remainder of the useful life of Braidwood Unit 2.
In the event Edison exercises the option to purchase the output of Braidwood Unit 2, it shall not thereafter have any option under this Agreement to reduce the amount o# power Edison is obligated to purchase fro = Braidwood Unit 1.
For power, and associated energy, produced from Braidwood Unit 2 i
Edison shall pay (subsidiary) the greater of (1) the market value of such power and energy as datermined by reference to third-party, arms length, long-term firm power purchase or (2) contracts commencing approximately January, 2000, rates determined using traditional net original rate base / rate of return regulation and accounting for fuel and all other costs of production, all as determined by the FERC.
If the FERC is without or disclaims jurisdiction with respect or declines to make such a determination of to such rates, market value or net original cost rate base / rate of return rates, such deter =inations as made by Edison and (Subsidiary]
shall be submitted to the ICC for review under Section 7-101 of the Public Utilities Act, and the determinations of the parties, as they may be modified by the ICC upon such review,-
shall be the basis upon which Edison shall pay [ Subsidiary),
except as otherwise provided in this Section.
5.4 EXTENSION OPTION (Option c).
Edison shall have the option to
- 1994, defer 'until the close of business on Friday,- July 1, the time by which it must exercise the option provided in Section 5'.2 above or the option provided for in' Section 5.3 If Edison exercises the option provided for in this above.
l the Initial Term of this Agreement shall be Section 5.4, and the entire output of the Units shall continue
- extended, 1995, f
to be available to Edison, to and including June 30, and the monthly payment required to be made by Edison under Section 4.1 of this Agreement shall be increased by an amount equal to 1/12 of the annual retail rate increase to which Edison shall be entitled as a consequence of its election, at 1
the direction of the ICC, to exercise.the option provided by this Section 5.4.
The bonus provision of Section 4.2 shall not apply during the period of such extension.
Particularly, but not in limitation of the foregoing, the capacity of Braidwood 2 shall remain subject to the option specified in Section 5.3 (ii) above (being part of Option b as set out in
" Options After 5 Years" in Paragraph 5 of the Memorandum of Understanding dated February 3, 1985).
5.5 DEFAULT OPTION.
(Subsidiary) recognizes that Edison has agreed with others to be directed by the ICC in its exercise of the options provided in Sections 5.2, 5.3 and 5.4 above.
In the event that Edison has filed with the ICC a request for such direction no later than 12 cenths prior to the.
applicable option exercise date, and the ICC has failed to direct Edison with regard to any such exercise, Edison shall be dee' red to have elected to contract to purchase the entire output of Byron Unit 2 for the re=ainder of its useful life and 50% of the entire output of Braidwood Unit l for the remainder of its useful life beginning on the date 12 months following the applicable exercise date.
In the event this Section 5.5 becomes operative, Edison shal'1 have no further options under this Article V and the rates for power for which Edison has so contracted shall be deternined as provided in Section 5.3 with respect to the output of Byron Unit 2 and Braidwood Unit 1.
ARTICLE VI BILLING 6.1 STATEMINTS.
As soon as practicable after the end of each I
calendar month, the Parties shall cause to be prepared a statement setting forth the energy delivered by (Subsidiary) to Edison from each Unit and the cost of fuel incurred by (Subsidiary) in producing such energy during such month.
If necessary, the cost of fuel may be determined on an estimated basis and adjusted retroactively once the actual cost of fuel incurred in such month is known.
Generally accepted practices and methods of accounting and billing for energy transactions between interconnected systems shall be followed in preparing such statements.
6.2-BILLS.
As soon.as' practicable after preparation of the monthly statement provided for in Section 6.1 above, (Subsidiary)'shall' render to Edison a bill for the amounts due (Subsidiary) by Edison for energy purchased.in the month i
covered by such statement, the capacity reservation charge for such month and any Bonus Energy compensation due
[ Subsidiary) pursuant to'Section 4.2 of this Agreement.
I Edison shall pay (Subsidiary) the amount due within 15 days of the date of the bill.
Unless otherwise agreed upon, a calendar month shall be the standard monthly period fer the purposes of settlement under this Agreement.
ARTICLE VII METERS AND METERING Electric power and energy interchanges at each point
~1.1 MITERS.
of delivery shall be measured by suitable metering equipment provided by Subsidiary.
Such metering equipment shall:be tested by Edison 7.2 TESTING.
at suitable intervals as specified by the parties'from time to time, such intervals not to exceed 12 months.. The accuracy of registration shal1 be maintained in accordance with sound operating practice.'
7.3 DILLING CORRICTIONS.
If, as a result of any test, any meter shall be found to bd registering more.than two percentage points above or below one hundred percent accuracy, the for a account between the parties hereto shall be corrected, period equal to one-half of the elapsed time since the last according to the p'ercentage of inaccuracy so prior test, found, except that if the meter shall have become defective or inaccurate at a reasonably ascertainable time since the last prior test of such meter, the correction shall extend Should metering equipment at any time back to such time.
fail to register, the energy delivered shall be determined "7T SI.from the best available data.
l ARTICLE VIII CONDITIONS PRECEDENT TO EFFECTIVENESS OF AGREEMENT, AMENDMENTS AND SPECIAL TERMINATION RIGHT The effectiveness of this Agreement is 8.1 CONDITIONS PRICEDENT.
l conditioned upon the approval or acceptance for filing of '
1 1
this Agree =ent by any regulatory authority having jurisdic-tion and the approval by the ICC of Edison's sale of the Units to [ Subsidiary).
8.2 FERC ACCEPTANCE FOR FILING.
[ Subsidiary) and Edison nutually recognize and agree that this Agreement will be filed with the Federal Energy Regulatory Co==ission and (Subsidiary) and Edison agree jointly to request acceptance for filing of this Agreemen', without suspension by the FERC.
In this connec-tion,, Edison and [ Subsidiary) agree that each of them will execute any and all documents, duly authorize all officers or agencies, and do all of the things necessary and appropriate to secure acceptance for filing of this Agreement by the FERC without suspension, or change or =odification of the terns
)
hereof, no later than July 1, 1987.
8.3 AMENDMENTS.
This Agreement may be amended only upon nutual agreement of the parties.
Any such amendment shall be in writing and will be effective as of the date set forth in the order of any regulatory authority, or other governmental agency having. jurisdiction, approving or accepting for filing such amendment or any portion thereof l
l that is required to be approved or accepted.
j l
8.4 SPECIAL TERMINATION RIGHT.
If, for any reason, Edison is not per=itted to place in effect or naintain the rates provided for in the Memorandum of Understanding, Edison shall have the right to terminate this Agreement, such termination to be effective when and as specified by Edison.
. j
ARTICLE IX MISCELLANEOUS 9.1 GOVERNING LAW.
The validity, interpretation and perfornance of this Agreement and each of its provisions shall be gov-erned by the laws of the State of Illinois, except to the extent that this Agreenent shall be subject to federal law.
9.2 COUNTERPARTS.
Any number of counterparts of this Agreenent may be executed and each shall have the sane force and effect as the original.
9.3 NOTICES.
Any notice, demand or request made by a party to the other party pursuant to any provision of this Agreenent shall be =ade in writing and shall be delivered either in person, by prepaid telegra= cr by registered or certified mail to the officer at the address listed below, provided that each party may from time to time change the designated recipient or the address or both, to be used for the giving to it of any such notice, demand or request, by giving written notice of such change to the other party.
TO [ Subsidiary):
TO Edison:
9.4 SECTION HEADINGS NOT TO AFFECT MEANING.
The descriptive headings of the various Articles and sections of this Agree-
=ent have been inserted for convenience only and shall not nodify or restrict any of the terms and provisions thereof.
From time to time after the execution of 9.5 FURTHER ASSURANCES.
this Agreement, each party shall execute such instruments, upon the request of the other, as may be necessary or appro-priate to carry out the intent of this Agreement.
Any valver by either party of its rights with 9.6 WAIVERS.
or with respect to respect to a default under this Agreement, shall any matter arising in connection with this Agreement, not be a waiver of any subsequent default er natter.
9.7 COMPUTATION OF TIME.
In computing any period of time prescribed or allowed by this Agreement, the day of the.act, or default from which the designated period of time
- event, begins to run shall not be included.
The last day of the period so computed shall be included, unless it is a Saturday, Sunday, or legal holiday, in which event the period shall run until the end of the next business day which is not
~
a Saturday, Sunday, or legal holiday.
9.8 SURVIVORSHIP OF OBLIGATIONS.
The termination of this Agreement shall not discharge any party from any obligation it owes to the other party under this Agreement by reason of any transaction, loss, cost, damage, expense or liability which shall have occurred or arisen after the effective date of tr' Tgreement, but prior to such termination.
It is the intent of the parties that any such obligation owed (whether i
the same shall be known or unknown as of the termination of 1
this Agreement) will survive the termination of this Agreement. i
- i 9.9 Subsidiary hereby agrees to be bound by.the obligations j
1 imposed on it by the Memorandum of Understanding as if it j
-were an original signatory thereto.
IN WITNESS WHERIOF, the parties have caused this Agree =ent to be executed by their respective authorized officers
. and their respective corporate seals to be affixed hereto as of the date first above written.
ATTEST:
COMMONWEALTH EDISON COMPANY.
By Secratary (Title) 1 ATTEST:
[ Subsidiary)
By' Secretary (Title) 0 4
Appendix 6 "Most Favored Nations" During the 20-year period June 30, 1992 through June 30, 2012 Edison under Section 5.2 of this Agreement shall have the rights set forth in paragraphs (A) and (B) below.
(A)
If Edison is purchasing power under a Contract with the Subsidiary (" Pre-Existing Edison Contract") and the Subsidiary enters into a contract to sell power to a Third Party (" Third Party Contract") which-is comparable to the Pre-Existing Edison Contract, but contains more favorable prices or payment terms,
~
Edison may~ elect to have the price and payment terms of the Third Party Contract substituted for the prices and paynent terns of the Pre-Existing Edison Contract.
A Third Party Contract shall be considered to be "co parable" only if:
f.
It is effective over approximately the same calen-l dar time period as the Pre-Existing Edison Contract.
{
1 II.
Any other difference between the terms and condi-tions of the Third Party Contract (excluding price and payment terns) and those of the Pre-Existing Edison Contract does not i
significantly affect (i) the Subsidiary's cost of providing ser-l vice,-(11) the quantity or type of service to be provided, (iii) the benefits obtained b'y the Subsidiary, or (iv) the risks under-i taken by the Subsidiary.
{
Edison shall have no right to substitute only the price Er pay =ent terms of the Third Party Contract for those of the Pre-1
Existing Edison Contract, it being understood that Edison's elec-tien under this paragraph is limited to substitution of both the 1
payment and price terms of the Third Party Contract for those of the Pre-Existing Contract.
B.
If the Subsidiary enters into a Third Party Con-tract and Edison advises Subsidiary that it desires to purchase power under a co= parable contract, the Subsidiary will offer power l
to Edison under a conparable contract, if such power is available from the Units.
For purposes of this paragraph, a contract will be considered to be conparable to the Third Party Centract only if its ter=s and conditions are raterially the same as those of such Third Party Contract excepting only such. terms and conditions as do not significantly affect (i) the Subsidiary's cost of providing se rvice, (ii) the quantity or type of service to be provided, (iii) the amounts, form and timing of payments, (iv)-the benefits obtained by the Subsidiary or (v) the risks undertaken by the Subsidiary.
No such comparable contract shall relieve Edison of any of its obligations under any Pre-Existing Edison Contract.
Upon the execution of any Third Party Contract, the Subsidiary will give Edison notice of same and furnish copy of same to Edison within 30 days of the execution of said Third Party Contract.
n,M ": 7 8..
O f
I 1
CONSTRUCTION AND OPERATING AGREEMENT Agreement dated as of 1987, between
(" Subsidiary") and Commonwealth
. Edison Co=pany (" Edison").
Subsidiary and Edison agree as'fol-lows:
1.
Recitals.
In accordance with an agreement entitled Memorandum of Understanding, dated February 3,1987, among Edison, the Governor of the State of Illinois, the Attorney General of the State of Illinois, the State's Attorney of Cook County and other parties (the " Memorandum"), Edison has agreed to transfer its nuclear generating facilities known as Byron Unit 2 and Braidwood Units 1 and 2 (the " Units")
to subsidiary.
The real estate'and facilities constituting the Units are more particularly described in the Facilities Transfer Agreement.
Idison has also agreed th.at it would complete and op'erate the Units transferred to Subsidiary as agent for Subsidiary.
2.
Coroletion of Construction.
Edison agrees to complete the construction of the Units as soon as is commercially OM - -: ;.~.._,
feasible in accordance with the Construction Permits issued by the' United States Nuclear Regulatory Commission ("NRC").
In this regard, Edison shall, and Subsidiary irrevocably authorizes
~
Exhibit D
Edison to, =ake such contracts, agree ents and mcdifications to existing contracts and take such other actions as Edison, in its sole discretion, considers necessary or appropriate to complete the constructicn of the Units and their preparation for cc==ercial service.
Subsidiary will cooperate with Edison in connection with its duties under this paragraph, including, without limitation, applications for authorizations, permits or licenses and the execution of such other documents as may be reasonably required.
3.
Construction Pavrents.
Edison shall be respons-ible for making arrangements for the payment of all costs and obligations incurred in connection with the construction of the Units.
The costs incurred by Edison in connection with such construction up to the in-service date of the Units shall be deemed to be a contribution to capital by Edison as. sole shareholder of subsidiary.
Edison shall also be responsible for making arrange-cents for payment et all costs and obligations incurred after the in-service date,' in connection with the construction of any needed replacements, modificatiens, additions, retrofits or similar improve =ents'with respect to the Units.
Edison shall bill Subsidiary for these costs.
To the extent practicable, the billings shall be at such times as shall be appropriate to put the amounts billed in Edison's hands at the times disbursements are =ade.
To the extent such billing is not practicable, Edisen shall have the right to bill suosidiary for capital costs.
" Capital Costs"
=eans a return on Edison's unamortized investment in the ite in question, at a rate equal to that which I
Edison has been authorized to earn on rate base in its then most recent general rate order promulgated by the Illinois Co==erce
(
Co==ission (such rate to vary when and as such Cc==ission promulgates new orders) and, in the case of invest =ent in depreciable (or otherwise a=ortizable) property, amortization of the value of such investment in accordance with the basis then used by Edison in respect of similar property includable in Edison's retail rate base.
Subsidiary =ay require Edison to provide Subsidiary with a statement shewing in reasonable detail the basis for the computation of any bill, at or about the time the bill is rendered to subsidiary.
The existence of a dispute between Edison and Subsidiary with respect to the proper a=ount of any bill shall not relieve subsidiary of its obligation to pay the bill when due.
All bills shall be subject to audit and later correction if in error.
4.
Oreration and Maintenance.
Edison shall operate and vaintain the Units in accordance with the ter=s of the applicable NRC operating Ideenses, taking all steps which it considers necessary or appropriate for that purpose, including, f
but not limited to, (a) =anning the Units with its own erployees, (b)
=aking and =odifying contracts with third parties, (c) ni securing and keeping in effect all necessary licenses and other govern = ental authorizations, (d) preparing and =aintaining reports and records required by govern = ental authority or necessary or appropriate to properly account for the costs and s
expenses of operation and maintenance of the Units, (e) providing purchasing, engineering and other support services associated with the operation of the Units, (f) procuring and maintaining such liability and property insurance as may be required by law or may be otherwise considered to be desirable by Edison and (g) providing off-site electrical power to the Units as described in Section 8.2 of the Safety Evaluation Reports for Byron Station dated February,1982, and the Braidwood Station dated December,'1983, as amended frc: time to time.
During the Priority Period applicable to a Unit, Idison will treat such Unit on the sa=e basis as.its own units, allocating personnel and other resodrces, dispatching and establishing priorities for activities and resources among the Unit and Edison's own units as though Edison owned the Unit.
The " Priority Period
- applicable to a Unit is the Rate Moratorium Period (as defined in the Memorandum) and any subsequent period during which Edison is purchasing output from such Unit under a contract entered into pursuant to subparagraph (b) of paragraph 5 of the Memorandum.
During any other period Edison will operate and raintain a Unit in accordance with accepted utility practices.
Edison shall also construct any needed replacements,
=odifications, additions, retrofits or similar improvements to
_4
the Units, whether required before or after completion of the Units, and shall retire and decommission the Units upon the expiration of their useful lives, salvaging any useful parts of the Units.
Subsidiary will cooperate with Edison in all activities in connection with the operation and maintenance of the Units, including, without limitation, applications for authorizations, fr."mits and licenses and the execution of such other docu=ents as may be reasonably required.
5.
Operation and Maintenance Costs.
Edison shall be.
responsible for making-arrangements for the payment of all costs and obligations incurred in' connection with the operation and maintenance of the Units, including without li=1tation, all costs associated with materials and supplies inventories used for the Units and the disposal of nuclear fuel used in the Units, irrespective of the identity of the owner of such fuel.
Edison shall bill Subsidiary for these costs.
To the extent practicable, the billings shall be at such times as shall be appropriate to put the amounts billed in Edison's hands at the times disbursements are made.
To the extent such billing is not practicable, Edison shall have the right to bill Subsidiary for Capital Costs.
Sub "liary may require Edison to provide Subsidiary with a statement showing in reasonable detail the basis for the ce=putation of any bill, at or about the time any bill is rendered to subsiditry.
The existence of a dispute between Edison and Subsidiary with respect to the proper amount of any bill shall not relieve Subsidiary of its_cbligation to pay the bill when due.
All bills shall be subject to audit and later correction if in error.
6.
Nuclear Fuel.
Nuclear fuel may be leased or subleased by Edison to Subsidiary.
In the case of fuel subleased to subsidiary, subsidiary shall pay to Edison a rental equal to the amounts payable by Edison in respect of such fuel under Edison's lease of such fuel.
To the extent practicable, such rental payments shall be due at such times as shall be appropriate to put the amounts billed in Edison's hands at the times Edison makes its rental pay ents.
In the case of nuclear fuel leased by Edison to subsidiary, Subsidiary will. pay to Edison a rental equal to the Capital Costs applicable to such fuel.
7.
Allocation of overhead.
Subsidiary recognizes that under this Agreement Edison vill incur expenses associated with its management and supervisory duties which are not fully compensated in the Construction Costs and operation and Mainten-ance Costs provided for above.
Accordingly, subsidiary. agrees to pay Edison annually an aller-w'e portion of its canagenent and supervisory overhead costs with respect to each of the Units, to 1
l >
be determined in accordance with the following formula:
U X
A and G T
Where:
means the total construction expenditures and operating "U"
expenses of the Unit in question for that fiscal year;
= cans Edison's total construction expenditures and "T"
operating expenses for that fiscal year including all such expenditures made in connection with this Agreement; and "A&G" reans the total of Edison's Administrative and General as reflected in Edison's books of accounts
- Costs, maintained in accordance with applicable regulatory requirements, including applicable pension provisions, other e=ployee benefits and payroll taxes, and executive management's sal ci.rs and the expenses of e,1 -; _ _
their offices for that fiscal year.
With respect to each Unit " fiscal year" means that part of each calendar year during the ter= hereof which is subsequen.
l i
i to the in-service date of the Unit and prier to completion of its decommissioning and retirement.
Edison shall bill Subsidiary for J
its allocable share of manage =ent and supervisory overhead costs within 30 days after the close of each fiscal year.
Subsidiary shall make pay =ent to Edison within ten days after receipt of the j
bill.
l 8.
Byron Station Conron Plant and Comron Costs.
1 Edison shall make the real estate and facilities designed, constructed or used as cc =en plant for both units of the Byron Station available when and as required for operation and maintenance of Byron Unit 2.-
Subsidiary agrees to pay to Edison
\\
for the use of such common plant a monthly rental charge equal to 50% of the Capital Costs applicable to such com=on plant.
To the extent practicable, costs properly assignable to a Unit at the Byron Station shall be assigned to the owner of l
such Unit.
Fifty percent of operating and maintenance costs not readily allocable to a Unit shall be allocated to Byron Unit 2.
The parties recognize that there are facilities associated with each of the generating units at the Byron Station which are not classified as common plant but which are, from time to time, used in connection with the operation of both units.
Such facilities will continue to be so used throughout the remaining useful lives of such generating units.
During the Priority Period applicable to Byron Unit II, neither party shall be obligated to co:pensate the ether for such use.
For any -----
period thereafter, the parties will agree to an appropriate such method of sharing the use of, and costs associated with, facilities.
I 9.
.Soare Ecuierent.
Edison will make available to Subsidiary for use in connection with the Units spare equipment and parts maintained in connection with Edison's units.
Subsidiary will make available to Edison for use in connection with Idison's units' spare equipment and parts maintained in conne'ction with the Units.
The party receiving any such spare equipment or parts shall compensate the other party either in cash or by providin'g like equip =ent or parts, at the election of If payment is to be the party providing such equip =ent er parts.
made in cash', such payment shall be equal to the original cost of the item in question.
At any ti=e after the Rate Moratorium.
Perio'd (as defined in the Memorandum), either party may terminate
~
the obligations to make equipment and parts available under this e
paragraph.
Subsidiary shall at all times provide 10.
Access.
Edison, its e=ployees, independent contractors and other authorized invitees with access to the Units for such >trposes as including Edison, in its sole discretion, considers appropriate, access to the NRC to assure compliance with NRC regulations..
Except as otherwise provided in paragraph 11.
Tern.
12, this Agreement will continue in force until the earlier of I
(a) the retirement of all of the Units or (b) such date as is provided for by Edison and Subsidiary in a written agreement to the effect that this Agreecent is terminated.
12.
Terrination.
Edison may terminate this Agreement if Subsidiary becomes insolvent or generally fails to pay, or 1
admits in writing its inability to pay, debts as they becene due; or subsidiary applies for, censents to or acquiesces in the appointnent of, a trustee, receiver or other custodian for Subsidiary or any property thereof, or-nakes a general assignment for the benefit of creditors; or,.in the absence of such a trustee, receiver or application, consent or acquiescence, other custodian is appointed'for Subsidiary or for a substantial part of thd property of Subsidiary and is not discharged within 30 days; or any bankruptcy, reorganization, debt arrangement, or other case or proceeding,under any bankruptcy or insolvency law, or any dissolution or liquidation proceeding is commenced in respect of Subsidiary, and if such case or proceeding is not commenced by Subsidiary it is consented to or acquiesced in by Subsidiary or remains for 30 days undismissed; or Subsidiary takes any corporate action to authcrize, or in furtherance of, any of the foregoing.
k Subsidiary may terminate this Agreenent as to any Unit, upon twelve months' prior written notice to Edison of Subsid-inry's determination to terminate with respect to such Unit provided that no such termination may be effective prior to the end of the Priority Period applicable to such Unit.
The foregoing termination rights shall be in addition to any other' rights the parties may have arising out of any fact
.or circumstance referred to in this paragraph or arising out of any default.
No such termination shall relieve Edison of any obligation it may have as a licensed operator of the Units or as otherwise may'be imposed on Edison by the NRC or by operation of law with respect'to safety of construction, operation, maintenance, shutdown or decommissioning of the Units.
13.
Acency.
Subsidiary hereby appoints Edison as Subsidiary s agent for the purpose of completing construction of the Units and operating and maintaining them under the terms of this Agreement; and, it is expressly understood thati in so constructing, operating and maintaining the Units, Edison will be acting solely as agent for subsidiary and not as a principal.
This Agreement shall not create any rights in any person, other than Edison and Subsidiary, whether as a third party beneficiary or otherwise.
Edison shall have no obligation hereunder to anyone other than Subsidiary and Subsidiary shall have no right to assign, convey, pledge or otherwise transfer any of its rights hereunder without the prior written consent of Edison.
Nothing >
m 1
1 contained herein shall operate to limit any ob:igation Edison nay
)
)
have as a licensed operator of the Units, or as otherwise may be I
{
imposed on Edison by the NRC or by operation of law with respect to the safety of construction, operation, maintenance, shutdown or decen=issioning of the Units.
14.
Miscellaneous.
(a)
The validity, interpretation and performance of this Agreement and each of its provisions shall be governed by the law of the State of Illinois as though all acts or omissions occurred in that State.
This Agreenent is subject to the ap-1 proval of any regulatory authority required by law.
(b)
The section headings included in this Agree-ment have been inserted for convenience of reference only and shall in no way affect the interpretation of this Agreement.
(c)
This Agreement may not be amended except by a written instru=ent executed by Edisen and Subsidiary.
(d)
This Agreement may not be assigned by either party without the prior written consent of the other party, which shall not be unreasonably withheld.
(e)
This Agreement is subject to approval by the Illinois'Cor=arce Commission and shall only become effective upon such approval.
.a Executed this day of
, 1987.
CO!GOWEALTH EDISON COMPANY By:
Its:
(SUBSIDIARY)
By:
Its:
n ?~ : - ~. _.
e-TINANCING AGREDENT CC!c'.0 WEALTH EDISCN COMPANY, ("Edisen"), and
(" Subsidiary"), in censideratien of these l
natters set forth in Article I hereof agree as follows:
ARTICLE I Feeitals Edisen cwns 100% cf the cutstanding equity securi-(a) ties cf Subsidiary.
(b)
Idis:n and Subsidiary are parties to a Facility Transfer Agree:ent, a C nstruction and operating Agreement, and a Power Supply-Agreement, all of even date herewith.
Pursuant to these agreements, Edisen will transfer to subsidiary the facilities c:===nly referred to as Byren Unit 2 and Braidweed Units 1 and 2 (cellectively the " Units"), and as agent for subsidiary, cc plete c nstruction cf the Units, cperate_and maintain the Units, and c=nstruct any =cdificatiens.thereto fer at least 5 years, required f r their c:ntinued cperatien, and, will have the right to purchase all of the pcwer generated thereby.
In crder to perfer: its obligatiens under there agreerents, Subsidiarf =ay be required to make expenditures in excess of the revenues received by it frc= sales of power.
Exhibit F
O' AFTICLE II Fundinc 1.
On or before July 1, 1987, Edison vill make a cash contribution to the capital of Subsidiary in the amount of
$25,000,000 to provide working capital.
Thereafter, from time to time, and at subsidiary's request, Edison will make available to subsidiary such funds as may be necessary to enable subsidiary to comply with any. obligation it may have with respect to safe construction, operation, maintenance, shutdown or decommissioning of the Units; provided that nothing herein contained shall be construed as obligating Edison to provide funds to enable Subsidiary to continue or resume operation of the Units, or any of them, when Edison believes that continued or resumed operation is unecono=ical.
- 2..
From time to time, and at Subsidiary's request, Edison may make available to subsidiary such funds as may be nece'ssary to enable subsidiary to perform its obligations in cnr to fulfill respect of the agreements referred to in Article I, any other obligation-Subsidiary =ay come to have arising out of or relating to ownership or operation of the Units.
ARTICLE III Conditions At Edison's option, funds to be provided hereunder shall be made available in the form of:
(1) loans bearing interest at a l
rate not to exceed 250 basis points above Edison's then most i
recent borrowing of similar duration; (2) non-interest bearing capital advances; or (3) capital contributions.
APTICLE 12 Tern This Agree =ent shall continue in full force and effect
'during the term of the Construction and operating Agreement referred to above.
ARTICLE V Limitatiens (a)
The obligations of Edison to provide funding under paragraph 1 of Article II and its right to provide other funding hereunder shall be subject to approval of this Agreement by the Illinois Con =erce Commission.
I I
(b)
This Agreement shall not create any rights in any l
person, other than Idison and Subsidiary, whether as a third party beneficiary or otherwise.
Edison shall have no obligation hereun-i der to anyone other than Subsidiary and subsidiary shall have no right to assign, convey, pledge or otherwise transfer any of its rights hereunder without the prior written consent of Edison.
(c)
Subsidiary shall not use any of the funds provided to Subsidiary hereunder for any purpose other than those specified in Article II.
3 F
i Illinois, the day of Dated at 1987.
COMM0h"rTEALTH EDISCN COMPANY By By H
N e'
' *f r.
O*
- E Gkg
~E h "sy k'i
.P UNITED sT ATEs NUCLEAR REGULATORY COMMISSION MSmNG TON. D. C. 20555
..j gr.
f a
COMMONWEALTH EDISON CCMPANY f DOCKET NO. STN 50-456 BRAIDWOOD STATION UNIT 1 g
FFCILITY OPERATING LICENSE
' "*"Y CENTRhL 1 W N* ls M C TR ! c-G e n' a d A T '^' G License No. NPF-70 The Nuclear Regulatory Commission (the Comission or the NRC) has found 1.
E lec+r.h
, as amenkd]
gna cene.i r uiner.:
that:
c,. n e u +.f e, comp.o y The application for a license filed by Commonwealth Edison Company e A.
Lthe ' f = =c' complies with the standards and requirements of the (c.e - Hunsee3) Atomic Enercy Act of 1954, as amended (the Act), and the Commission's regulatiers set forth in 10 CFR Chapter I, and all required. notifications to other agencies or bodi.e.s have been duly made; Construction of Braidwood Station, Unit 1 (the facility) has been l
S.
substantially completed in conformity with Construction Permit No.
CPPP-132 and the application, as amended, the provisions of the Act and the regulations of the Commission; The facility will operate in conformity with the application, as C.
amended, the provisions of the,Act, and the regulations of the Commission (except as exempted from. compliance ir) Section 2.D.
below);
(il that the activities authorized by There is reasonable assurance:
D.
this operating license can be conducted without endangering the health and safety of the public, and fii) that such activities will be conducted in compliance with the Commission's regulations set forth in 10 CFR Chapter I (except as exempted from compliance in Section 2.D. below);
Fm* C c +rs I = il'noa-E l *' t'Q a.
f own& wa < s n < e+_
D Corrmonwealth Edison CompanyKis technically qualified to engage in cm#,, N E.
L the activitis; authorized by this license in accordance with the Commission's regulations set forth in 10 CFR Chapter I; Commonwealth Edison Company has satisfied the applicable provisions F.
of 10 CFR Part 140, " Financial Protection Requirements and Indemnity Agreements," of the Commission's regulations; s h ! b,'+
F
i '
G.
The issuance of this license will not be inimical to the common defense and security or to the health and safety of the public; H.
Af ter weighing the environmental, economic, technical, and other benefits of the facility against environmental and other costs and considering available alternatives, the issuance of Facility Operating License No. NPF-70, subject to the conditions for protection of the environment set forth in the Environmental Protection Plan attached as Appendix B, is in accordance wi'th 10 CFR Part 51 of the Commission's regulations and all applicable requirements have been satisfied; and I.
The receipt, possession, and use of source, byproduct and special nuclear material as authorized by this license will be in accordance with the Commission's regulations in 10 CFR Parts 30, 40 and 70.
-2.
Based on the foregoing findings regarding this facility, Facility
' Operating License No. NPF-70, which supercedes Facility Operating License N [o-
' No. NPF-59 issued on October 17, 1986, is hereby issued to C;=ca c ith + h e c e - liccous Ed s& C=p=y (t6 1 % &e} to read as followst
,y}
v*
A.
This license applies to Braidwood Station, Unit 1, a pressurized jN water reactor, and associated. equipment (the facility) owned by t o vCommonwealth Edison Companyd The facility is located in north -
$.[ g g gv h ceed D eastern Illinois, 3 miles southwest of the Kankakee River, 20 miles y.-
E s ui d, s w e\\ south-southwest of the town of Joliet, and 60 miles southwest of k (! t1 e
\\ t Chicago, Illinois. The facility is within Reed Township, Will 4
D
, G * * " "b.
W"^d. County, Illinois and is described in.the Byron /Braidwood Stations'.Fina
^3 o
A C
the Environmental Report, as supplemented and amended, d
t V.e d
3 r.' ** 4 *s4' B.
Subject to the conditions and requirements incorporate ~d herein,
.., j C 3
v 4 5 t the Commission hereby licenses:
ce-t.ws s
Xb k.? ^ {
(1) Cc=cher.'thClisenCom.ny(00:01,pursuanttoSection t
S-
+
103 of the Act and 10 CFR Part 50, to possess, use and 0
20 'q I
g operate the facility at the above designated location in 2o
- 4. I N
7%
i T Will County, Illinois, in accordance with the procedures
=
and' limitations set forth in this license; *
&8 J!f k ca ~ liuns e c *>
?-
4 (2) GEftr,6 pursuant to the Act and 10 CFR Part 70, to receive, oJ f 4
i possess and use at any time special nuclear materiel as iE(
[
]
0' reactor fuel, in accordance with the limitations for Ey1 3
storage and amounts required for reactor operation, as
+3 fa+y(
y 00 described in the Final Safety Analysis Report, as supplemented and amended; 3s fey (
co-Ucensee,
g4 5
o 4
f (3) C40tr,4 pursuant to the Act and 10 CFR Parts 30, 40 and 70, y
(*#
e o =
6 to receive, possess, and use at any time any byproduct, h
source and special nuclear waterial as sealed neutron N3 I
sources for reactor startup, sealed sources for reactor
- 4 ggg
+
instrumentation and radiation monitoring equipment c ; '1
. o i et calibration, and as fission detectors in amounts as 5 E ;4 s
T. % {
required; ps 4
i
- Co -- I iws cc s, (4)' GEfe,^ pursuant to the Act and 10 CFR Parts 30, 40 and 70, to receive, possess, and use in amounts as required any
' byproduct, source or special nuclear material without
. restriction to chemical or physical form, f Ur sample
,j analysis or instrument calibration or associated with radioactive apparatus or components; and ca - I tem.se ex (5) fEttr,^ pursuant to the Act and 10 CFR Parts 30, 40 and 70, to possess, but not separate, such byproduct and special nuclear materials as may be produced by the operation of
'the facility.
This license shall be deemed to contain and is subject to the C.
conditions specified in the Commission's regulations set forth in-10 CFR Chapter I and is subject to all applicable provisions of the Act and to the rules, regulations and orders of the Commission now or hereafter in effect; and is subject to the additional. conditions specified or incorporated below:
'(1) Maximum Power Le' vel Coupan y (ca.)
ca,mnwe a in edlam The 'Memee^is authorized to operate the facility at reactor core power levels not in excess of 3411 megawatts thermal (100 percent rated power) in accordance with the conditions specified herein and other items identified in Attachment I to this license.
The. items ' identified in Attachment 1 to this license shall be completed as specified. Attachment 1 is hereby incorporated in.to this license. Pending Commission approval, this license is restHcted to power levels not in excess of five percent of reted power (170 megawatts thermal).
(2) Technical Specifications and Environmental Protection Plan The Technical Specifications contained in Appendix A and the Environmental Protection Plan contained in Appendix B, both of which are attachpp.pereto, are hereby incorporated into this The 'ic=t shall operate the facility in accordance license.
with the Technical Specifications and the Environmental Protection Plan.
(3) Emeroency Planning In the event that the NRC finds that the lack of progress in completion of the procedures in the Federal Emergency Management Agency's final rule, 44 CFR Part 350, is an indication that a major substantive problem exists _in achieving or maintaining an adequate state of emercency preparedness, the provisions of 10 CFR Section 50.54(s)(2) will apply.
-- (4) Initial Startup Test Procram Any changes to the Initial Test Program described in Se l
shall be reported in accordance with 50.59(b) within one month of j
such change.
(5) Reaulatory Guide 1.97, Pevision 2 Comoliance
{
The lictr:ce shall submit the final report and a schedule for I
C c" C o implementation within six months of HRC approval of the DCRDR.
The facility requires an exemption from the requirements o D.
air locks at times when containment integrity is not recuired (SER This exemption is authorized by law, will not present Section 6.2.6).
an undue risk to the public health and safety, and is consistent with This exemption is hereby granted.
the common defense and security.
j The special circumstances regarding this exemption are identified in j
the referenced section of the safety evaluation report and theThis ex j
j With this exemption, the facility will operate, to the extent authorized supplements thereto.
j herein, in conformity with the application, as amended, the provisions l
of the Act, and the rules and regulations of the Commission.
[ c a -_ f ic e n s u s) l
~
The An exemption was previously granted pursuapt~to no CFR.70.24.
exemptionwasgrantedwithNRCmaterialficens(No.SNM-1938, issued l
s October 8,1985, and relieved the 'iceatee fromfthe. requirement o l
/
a criticality alarm system.
criticality alarm system provision of 10 CFR 70.24 so far as this section applies to the storage of fuel assemblies held under this license, "c 'ic~see shall fmplement and maintain in effect all provisions cEn of the approved fire protection program as described in the E.
Final Safety Analysis Report, as supplemented and amended, and as approved in the SER dated November 1983.and its supplements, subject to the following provision:
Tk. liccr. ee may make changes to the g roved fire protection ce co program without prior approval of t.e Comission, only if those i
6 changes would not adversely affect the ability to achieve and l
maintain safe shutdown in the ever t of a fire.
l co -i.u ns u.c l
The liccn:cc^shall fully implement and maintain in effect allguard trai F.
provisions of the physical security and safeguards contingency plans previously approved by the Commission and all amendments and revisions to such plans made pursuant to the authority of 10 CFR 50.90 and 10 CFR 50.54(p). The plans, which contain Safeguards Information protected under 10 CFR 73.21, are "Braidwood Station Physical Security Plan, Security Persornel Training and Qualification Plan,* and Safeguards Contingency entitled:
Plan *" with revisions submitted thrcuch May 27, 1986.
)
- -. ~ -. - - - - - - - - _ - - - - - - - - - - - - - - - - - - - - -. - - _ _ _ - - -. - - - - - - _ - -. - - - - - - - - - - - - -. - - - _ _ - - - - - - - - - - - -. - _ _ - - - _ _ - - - - - - _ _ - - - - - _ _ - - - _ _ - - _ _ - - - - - - _ _ _
. C;ll?hlitcnsec4l)
G.
Except as otherwise provided in the Tecnnichl Specifications or Environmental Protection Plan, the licen5er shall report any violations of the requirements contained in Section 2.C of this license in the following manner:
initial notification shall be made within 24 hours2.777778e-4 days <br />0.00667 hours <br />3.968254e-5 weeks <br />9.132e-6 months <br /> to the NRC Operations Center via the Emergency Notification System with written followup within thirty days in accordance with the procedures described in 10 CFR 50.73(b), (c),
and(e).
c,-ticense.s H.
The-44cen;ce'shall have and maintain financial protection of such type and in such amcunts as the Commission shall require in i
accordance with Section 170 of the Atomic Energy Act of 1954, as amended, to cover public liability claims.
I.
This license is effective as of the date of issuance and shall expire at midnight on May 21, 2026.
FOR THE NUCLEAR REGULATORY COMMISSION F. 4 Thomas E. Murley, Director Office of Nuclear Reactor Regulation Attachments:
1.
Work Items to be completed 2.
Appendix A'- Technical Specifications (NUREG-1261) 3.
Appendix B - Environmental Protection Plan Date of Issuance: May 21, 1987
- The Security Personnel Training and Qualification P'an and the Safeguards Contingency Plan are Appendices to the Security Plan. As requested by CECO letter dated April 22, 1983, Revision 6 is to be considered "the initial formal submittal."
ADMINISTRATIVE CONTROLS 6.1 RESPONSIBILITY 4
/4 Ed/an an b
MO en 6.1.1 The Station Manager, Braidwood 5 shall be responsible for overall unit operation and shall delegate in writing the succession to this responsi-bility during his absence.
l o+
ca m m e n w e s t +h Ell.s o n, aa ta G o's
- n
& c"P*Yee m 6.1.
The Shift Engineero(or during his absence from the control room, a esignatec individual) shall be responsible for the control room command function.
A management directive to this effect, signed by the Assistant Vice President and General Manager Nuclear Stations shall be reissued to all y
station personnel on an annual basis.
G c.o m m mo /W, E i n e,.,
6.2 ORGANIZATION OFFSITE GLie n Thek o.a m mov e a. I + hffsite organization for unit management and, techni c
6.2.1 be as shown in Figure 6.2-1.
UNIT STAFF 6.2.2 The unit organization shall be as shown in Figure 6.2-2 and:
Each on duty shift shall be composed of at least the minimum shift a.
crew composition shown in Table 6.2-1; and b.
At least one licensed Operator shall be in the control room when fuel 'is in the reactor.
In addition, while the unit is in MODE 1, 2, 3, or 4, at least one licensed Senior Operator shall be in the control room; A Radiation Chemistry Technician,* qualified in radiation protection c.
procedures, shall be on site when fuel is in the reactor; d.
All CORE ALTERATIONS shall be observed and directly supervised by either a licensed Senior Operator or licensed Senior Operator Limited to Fuel Handling who has no other concurrent responsibilities during this operation; A site Fire Brigade of at least five members
- shall be maintained e.
onsite at all times.
The Fire Brigade shall not include the Shift Engineer, and the two other members of the minimum shift crew necessary for safe shutdown of the unit and any personnel required for other essential functions during a fire emergency; and
- The Radiation Chemistry Technician and Fire Brigade composition may be less than the minimum requirements for a period of time not to exceed 2 hours2.314815e-5 days <br />5.555556e-4 hours <br />3.306878e-6 weeks <br />7.61e-7 months <br /> in order to accommodate unexpected absence provided immediate action is taken to fill the required positions.
9 Ce,m m an n a. t h i= di u kss eveerI1 re. s pas s ; b ; I,% y
- 4. a n ;4-spera s; n
gen r o.G.
C en raI r IIinot,s E l s w c.
Ge.n erain3 c a,,,pa ny.
a t. M n b oS BRAIDWOOD - UNITS 1 & 2 6-1
n-.
-e w=
N Mc gt 3
gh;
--'N G
g p
,l/
bn S 6
O ;<; 4 v)
H *-
O O M
- Ow IxCn wC3 3
mU<
O T.ha Z%
8 1
x0a CD e5 bc X<2 i
l w
em os
- 5 W
4s X<
.e
}
i W
W 5
50 0
h 9y
$O2 Og eOO WOa w
2.-,
- +'
9 lO. *]
c, I
1 x.
46 M
j k
I J
O I
O O
4 d
L 2
I A
t T
e E
tw D
S N 2 O
GI T
TI A1 B T ll j i SS I
i ll l l l l Iil, I l X
T
)
E DI N
O N U
O
\\
W D
EE
. x TCG I
SI Y
A N
AV I
R g
W RD A
R A
U I
B EL I
. g D SI D
S
\\
R&B B
U S
O R"N O'G 1C T
2 D
T^
I l
D -
E C"LT R
A I
I E
UN R
-~~
E R
BU 2
F.
l S
T N
i IN A
G N G U
R N -
O T
I LIDD G
S L
N T
ENL UAU D
A E
I I
l Y
N r1 B L
N 1
B IU O-B R
P-Y E
M
~
R T
O A
A C
E N
l E
I D
I L
i L
N I
l X
A E
U C
A S
1 E
N O
g T
R E
IN U
F U
T C
l U
RTG1 R
ONN -
T T EI T S
l CM DIN L
L ANI U A
U E A P
I R
B I
T C
N N
O I
R C
P l l !
l l l I g l Il l l ll l II!,Il !
=
ATTACHMENT 1-The following general information is prnvided in support of the application for license amendment.
I.
Subsidiary Central Illinois Electric Generating Company A.
Name:
B.
Address:
P.O. Box 767 Chicago, IL 60690 The Subsidiary will be a corporation established C.
Business.
Purpose:
to hold title to the Facility and, through Commonwealth Edison Company as agent, operate the Facility for the purpose of selling the electricity generated thereby in accordance with rates approved by the Federal Energy Regulatory Commission.
The Subsidiary has not yet been Organization and Management:It will be created sometime in the future after favorable
-D.
- created, The subsidiary consideration by_the Illinois Commerce Commission.
~
'will be a corporation organized and existing under the laws of the Its principal office will be located in Chicago, State of' Illinois.
All of the stock of the corporation will be owned by Illinois.
All of the Subsidiary's directors and commonwealth Edison Company, prihcipal officers will be employees of Commonwealth Edison Company.
All will be citizens of the United States. They will be:
Subsidiary and Edison Position Name_
Chaiman and President
- James J. O'Connor Vice Chairman
- Wallace B. Behnke, Jr.
Executive Vice president
- Bide L. Thomas Vice President and Comptroller Raymond P. Bachert Vice President and General Counsel Harlan M. Dellsy Vice President James W. Johnson Vice President Thomas J. Maiman Vice President Robert J. Manning Vice President Donald A. Petkus Vice President Cordell Reed Vice President George P. Rifakes Vice President J. Patrick Sanders Vice President John J. Viera Treasurer Ernest M. Roth Secretrary Klaus H. Wisiol
- Also will be members of the Board of Directors of Central Illinois Electric Generating Company
l J
l
_2_
-l l
i It is not contemplated that the Subsidiary will have any other i
i t ff 1 employees with the possible exception of a few admin strat ve s a As explained below, all personnel and other resources needed persons.
to operate, maintain and decommission the Facility safely will-be provided by Commonwealth Edison Company.
II.
Facility Under the Facilities Transfer agreement, title to the Facility will be conveyed to the subsidiary, including. control over the site exclusion area as described in Section 2.1 of the Safety Evaluation Report, dated November, 1983, which was issued by the NRC for Braidwood Station.
-The Facility.is depicted in Exhibit G, Sheets 1 and 2, and consists of the following structures and equipment for each unit:
a.
Reactor Containment b.
Reactor Vessel Reactor internals including control rod drive mechanisms, c.
instrumentation and detectors, pressurizer and steam
. generators including separator;and dryer.
Cranes and Hoists used solely in connection with operation of d.
the Unit Main and Misc. Instrument and Control Panels e.
f.
piping, including valves and supports used solely in connection with operation of the Unit Circulating Water Pumps used solely in' connection with operation l
p.
of the Unit h.
Turbine (including foundation) 1.
Generator.(including foundation) i l
e 1
i f j. Condenser
)
345 KV Main power Disconnect Switch (1/2 interest) k.
1.
Cooling Lake III. ' Technical Qualifications The NRC has determined under the. operating license that Commonwealth These circumstances will Edison. company is qualified to operate the Facility.
The Subridiary will not change as a result of the proposed license amendment.
appoint Commonwealth Edison as its agent responsible for the operatien, This relationship is maintenance and decommissioning of the Facility.
established under paragraphs 4 and 13 of the Construction and operating Agreement (Exhibit D).
paragraph 13 also states that the Subsidiary shall have no right to " assign, convey, pledge'or otherwise transfer any'of its rights" Moreover, as sole without the written consent of Commonwealth Edison Company.
owner of the shares of the Subsidiary, Edison will control all decision-making to assure that the Facility's nuclear operations organization, which was found technically qualified by the RRC in its Safety Evaluation Report (SER, dated
~
Finally,-the NRC will have regulatory.
November, 1983), will remain in place.
control over the Subsidiary as a co-licensee of the Facility as well as Edison thereby* subjecting any change in the operating entity of'the Facility,to the NRC's approva,1.
IV.
Financial Oualifications Commonwealth Edison Company is responsible financially for the operation, maintenance, and dscommissioning of the Facility under the proposed amendment and as set forth in Article II of the Financing Agreement as that term is used"in the NRC's regulations-(Exhibit E),
In accordance with its obligations under those regulations, Commonwealth Edison Company commits to provide'the necessary financial resource to operate, maintain and decommission the Facility safely.
Commonwealth Edison Company is an electric utility as defined in 10 to 10 CFR Section 50.33(f) and 57.57(a)(4) no CFR Section 50.2, and pursuant finding of financial responsibility to operate the Facility was required when None is required of the Subsidiary since the operating license was issued.
(i) Commonwealth Edison is assuming full responsibility for the Facility, and (ii) the Subsidiary also qualifies as an electric utility under 10 CFR Section 50.2 because as the owner of the Pacility its legal status properly qualifies it as'a generator and seller of electricity through rates established by a separate regulatory authority.
l ATTACHMENT 2 Antitrust Review Commonwealth Edison Company submitted the requisite information under 10 CFR Section 50.33a and Appendix L to Part 50 in connection with the operating license antitrust review for Braidwood Unit 1.
The information was reviewed by the Attorney General and comments were solicited from the public.
On Septemberil8, 1986 the NRC's Director of the Of fice of Nuclear Reactor Regulation made findings, in accordance with Section 105(c)(2) of the Atomic Energy Act of 1954, as amended, that no significant changes had occurred since the construction permit reviews by the Attorney General and the NRC for
~
Braidwood Unit I which would require a second antitrust review in connection with the ou application.
(See 51 Fed. Reg. 34171 (September 25, 1986)).
The following discussion will demonstrate that neither the. Agreement which occasions this Amendment application nor its implementation constitute changed circunstances which raise any significant issues under the antitrust laws or which require a further antitrust review.
For a period of five to eight. years after the effective date of the Agreement *, Edison'(and through it, Edison's customers) will be entitled to all of the power generated by the Units. That is no different from the situation without the Agreement..At all times, both with and without the Agreement, the price of power generated by the Units, and thus as an economic matter, what is pcid for entitlement to the poder, is subject to regulatory control.
The
' Illinois Commerce Commission controls the price of power sold to Edison's retail ~ customers and the FERC controls'the price of-power sold to other, utilities (including municipal systens).
What may be different under the Agreement is that after the initial period (the duration of which, 5 to 8 years, is to be determined by the Illinois commerce. Commission) is the identity of the utility entitled to the Under power and, more importantly, what is to be paid for that entitlement.
Edison's ownership, the situation without the Agreement, the amount paid for entitlement to the power is determined by traditional ~ rate base / rate of return regulation. Such regulation serves to place both a cap and a floor on the amounts (rates) paid for the electricity generated. However,' with the Subsidiary!s ownership of the Units under the Agreement, the amounts paid for entitlement to the power may be lower than with Edison's ownership. The Subsidiary, unlike Edison, has no service territory and thus, has no assured market for the power. This means that the Subsidiary may be unable to sell the power at prices equivalent to those permitted by regulation. In that circumstance, the power will be sold at rates determined by competitive market forces..This circumstance is dependent on the options which are exercised by Edison at the end of the initial 5-year term of the Power Supply Agreement, as directed by the Illinois Commerce Commission. This arrangement between Edison, the Subsidiary and the Illinois Commerce Commission is, if anything, pro-competitive.
3107K
ATTACHMIDrr 3 I
-i Analysis of No Significant Hazards Consideration The application to amend the operating license to add the Subsidiary as a co-licensee of the Facility involves no significant hazards consideration as demonstrated herein.
The tests for determining whether a proposed amendment involves no significant hazards consideration are set forth in 10 CFR:Section 50.92(c).
The proposed. amendment involves no change in the Facility, the manner in which the Pacility is-operated, or in the personnel who operate it.
The proposed change will involve'no alterations to the facility itself and no modifications to plant procedures. Therefore, the proposed. amendment involves no increase in the probability or consequences of an accident previously evaluated. Nor does it create the possibility of a new or different kind of accident from any accident previously evaluated or involve any reduction in a margin of safety.
e 3107K e
l
r da
\\
k kYN[
Y f.
Exhibit CK-1 i
Page 1 of 6 j
Charlen Xomanoff, Professional Experience (5/87)
Charles Romanoff is a consultant, analyst and author on the economics of the electric utility, nuclear power and coal sectors of the United States economy, and director of Komanoff Energy Associates, an energy and economic consulting firm at 270 Lafayette Street, New York, NY 10012.
Komanoff has written three books concerning the economic and societal costs of nuclear and coal electric generation; two.of the books were published by distinguished scientific publishing houses, cnd all three broke considerable new ground in their subject areas.
He has consulted for two agencies of the United States Congress, the U.S.
Department of Energy, and gcVernmental agencies of 15 States with a combined population of half the total population of the United States.
Komanoff is widely credited with having anticipated many of the key problems of the U.S. electric power industry over the past decade and a half: coal-fired generating plant emissions including acid rain; declining operational performance and economies of scale for large generating units, particularly nuclear units; and, most prominently, sharply rising real capital and operating costs for nuclear plants.
Komanoff's professional involvement in the U.S.
electric power, nuclear and coal sectors dates from September, 1971.
He has worked for the Council on Economic Priorities (1971-72 as a research fellow, 1974-76 as energy projects director); and for the New York City Environmental Protection Administration (1972-73 as quantitative analyst, 1973-74 as senior quantitative analyst).
He founded Komanoff Energy Associates in January 1977.
Komanoff has consulted for governmental clients and environmental and citizens organizations since 1975, first through.the Council on Economic Priorities, and since 1977 under the auspices of Komanoff Energy Associates.
He has presented expert testimony on electric utility economic matters before the U.S.
Nuclear Regulatory Commission, four NRC Atomic Safety & Licensing Boards, snd Public Utility Commissions of twelve States.
Komanoff has been an invited witness on nuclear and coal power economic issues before four He was also one of three American witnesses Committees of Congress.
to testify in the inquiry on nuclear power economics before the Select Committee on Energy of the House of Commons (U.K.).
Each of Komanoff's books defined and anticipated emerging aspects of
-- that electric utility costs -- both monetary and societal ultimately grew into critical areas of electric power policy.
The Jyice of Power:
Electric Utilities and tht Environment (published by CEP in 1972, republished by the M.I.T.
Press in 1974) documented the environmental impacts of the electric power sector, particularly by coal-fired generators, and described the rising conflicts between utility growth and the drive for environmental quality.
Power Plant Performance: Nuclear and Coal Capacit.y_[ac_ tors and Econ.omics
E
~
Exhibit. CX-1 4'
Page 2 of 6 Charles Komanoff, Professional Experience, cont'd. (5/87)
(published by CEP in 1976) analyzed the operational performance and comparative economics of nucicar and coal generating plants and described Power Plant Cost the constraints on improving reactor reliability.
a Escalation: Nuclear and Coal Capital Costs, Regulation and Economics republished by Van-(published by Komanoff Energy Associates in 1981, quantified the extent and item Nostrand Reinhold in 1982) of and, especially, the nuclear power rising real capital costs in the coal All sectors and predicted the economic distress from new nuclear units.
3' three books are distinguished by their attention to detailed, empirical, data on power plant monetary and societal costs.
costs is considered by Komanoff's work on nuclear and coal capital For many knowledgabic analysts to be the definitive work in that area.
the discussion of cost growth in nuclear plant construction
" Nuclear Power In An Age of Uncertainty,"
- example, in the February 1964 report, Office of Technology Assessment is based almost entirely by the U.S.on Power Plant Cost Escalation and later material that Komanoff provided to OTA as a consultant.
Komanoff has published
(
In addition to the books described above, scientific and scholarly journals articles in diverse industry, including Nuclear Safety (published at Oak Ridge National Laboratory by the U.S. Department of Energy), Journal of the Air Pollution Control Association, Bulletin of the Atomic Scientists, and Public Utilities Fortnightly.
He has also published articles in major The New York Times, and newspapers including The Wall Street Journal,His work is cited frequently and promine The Los Angeles Times.
in those periodicals and others ranging from Science to Barron's.
Komanoff graduated with honors from Harvard College in 1968, with a t
B.A. degree in Applied Mathematics.
list of major KEA governmental clients is provided on A chronological g
the following pages.
F-
.,-e
,i c
Exhibit CK-1 Page 3 of 6 KEA Governmental'C11ents 1
1987 PA Of fich(;of Consumor Advocate TX Off of Public Utility-Counsel IL i 'i y'Doard City of New Orleans
'LA!, Citizens Ut l t Public Servic'e Commission IL Office of Consumer Services CA,Public Utilities Commission WA Utilities & Transp. Commission IL' Commerce Commission DC Office of.the Peoples' Counsel 1986 TX Of'. of Public Utility Counsel f
CT DivisionLof Co sumer Counsel PA Office of Consumer Advocate City of New Orleans IL Citizens Utility Board CT DFUC, ProsecutorialLStaff LA Public-Service Commission IL Office of Consumer Services CA Public UtilitiesLCommission WA. Utilities & Transp. Commission 1985 y
CT Division of Consumer Counsel U.S. Department of-Energy PA Office of Consumer Advocate Montgomery County (Dayton, OH)
FL Office.of Public Counsel City of Cincinnati NY Consumer Protection Board 1984 ID Public Utilities Commission NY Consumer Protection Board WA (State) Public Counsel' OH Consumers' Counsel PA Office of Consumer Adv'ocate Montgomery County (Dayton, OH)
AZ Residential Utility. Consumers Off.
1983 Office of Technology Assessment OH Consumers' Counsel Public Utility Districts (var., WA)
Montgomery County (Dayton, OH) g 1982 WA (State) Attorney General IL Attorney General 1981 ID Public Utilities Commission NY Consumer Protection Board FL Office of'Public Counsel City of New York 1980 FL Office of Public Counsel
-NJ Public Advccate
i
- e '
Exhibit CK-1 Page 4 of 6 KEA Governmental Clients (Cont'd.)
1979 FL Office of Public Counsel NY Consumer Protection Board NJ Public Advocate 1978 NJ Public Advocate NY Consumer Protection Board Suf folk County (NY) 1977 NJ Public Advocate MI Attorney General City of New York KY Department of Natural Resources Suffolk County (NY)
NY Consumer Protection Board General Accounting Office (U.S. Congress) 1976 CA Energy Commission CT Public Utilities Control Auth.
NM Attorney General NJ Public Advocate (business and citizens group clients not shown)
I 1
I j
7 Exhibit CK-1 Page 5 of 6 Charles Komanoff Publications Spring 1987 BOCKS Power Plant Cost Escalation:
Nuclear and Coal Capital Costs, Ekoulation and Economics (Komanoff Energy Associates, 1981, republished by Van Nostrand Reinhold, 1982).
Power Plant Performance:
Nucicar and Coal' Capacity Factors and Economics (Council on Economic Priorities, 1976).
The Price of Power:
Electric Utilities and the Environment (Council on Economic Priorities, 1972, republished by M.I.T.
Press, 1974),
A co-authored with Sandy Noyes and Holly Miller.
l i
REPORTS
" Prometheus Bound:
Nuclear Power at the Turning Point" (Cambridge Energy Research Associates, 1983), co-authored with I.C6 Bupp.
" Power Propaganda:
A Critique of the Atomic' Industrial Forum's Nuclear and Coal Cost Data for 1978" (Environmental Action Foundation, 1980).
" Nuclear Plant Performance Update 2" (KEA, 1978).
" Nuclear Plant Performance Update" (Council on Economic Priorities, 1976).
" Responding to Con Edison:
An Analysis of the 1974 Costs of Indian Point and Alternativcs" (Council on Economic Priorities, 1975).
JOURNAL ARTICLES New England Journal of Public Policy, " Dismal Science Meets Dismal 1985.
Subject:
The (Mal) practice of Nuclear Power Economics," Fall Public Utilities Fortnightly, " Assessing the High Costs of New Nuclear Power Plants," Vol. 114, No.
8, 11 October 1984.
Public Utilities Fortnightly, One of two contributions to "Two Views the Comparative Escalation of Nuclear and Coal-Fired Power Plant ofCosts," Vol. 109, No. 11, 27 May 1982.
" Nuclear Costs Spiral Above Coal," Vol. 39, No.
5, Public Power, September-October, 1981.
" Sources of Nuclear Regulatory Requirements," Vol. 22, Nuclear Safety, No.
4, July-August, 1981.
\\
,n Exhibit CK-1 Page 6 of 6 JOURNAL ARTICLES (Continued)
"U.S. Nuclear Plant Performance,"
Eulletin of the Atomic Scientists, sovember 1980.
Association, " Pollution of the American Pollution Control What Journal Improvements in Coal-Fired Electric Generating Plants:
'They Accomplish, What They Cost," Vol. 30, No. 9, September 1980.
Control New York Review of Books, "Doing Without Nucicar Power," Vol. 26, No.
8, 17 May 1979.
What Utilities Must
" Electric Utility Demand in the Coming Decades:
It -- What Consumer Advocates and Regulators Should Do Now,"
Do About Electric Potential, Winter, 1985-86 NEWSPAPER ARTICLES (Op-Ed piecen)
The_New York Times, Sunday Financial Section, "The Power Shortage Is A Mirage," 28 April 1985.
Wall Street Journal, " Nuclear Crews Stretch Work, Up Costs", 19 March 1984.
"Lilco's Owners Should Share The Burden," 11 January 1983.
- Newsday, "Let's Halt Shoreham Work While Seeking True Costs," 19 June
- Newsday, 1980.
Newsday, "Shoreham:
Time For A Reappraisal," 26 June 1979.
Los Angeles Times, "A Coal-Fired Future," 3 September 1981.
St. Louis Post-Dispatch, " Nuclear Vs. Coal:
Rising Costs Are 8 July 1981.
Undermining The Economics of Atomic Power,"
WORKS IN PROGRESS "The Economic Impact of Three Mile Island," presented to the American May 1986 (in Association for the Advancement of Science symposium, revision).
Not Included Here Consultant Reports Expert Testimony Testimony CongressionalNumerous articles in environmental / citizens periodicals
dM C.hm7 F
.g '
1 I.
STATEME::T OF QUALIFICATIO::S OF JAMES A.
ROTl!SCHILD 2
0..
Please state your t.ame and business address.
l 3;y A.
My na.T.e is James A.
Rcthscnild.
My address is l
I 4
Scarlet Oak Drive, Wilton, Connecticut 06897.
j hg 5
O.
What is your occupation?
6 A.
I am a financial consultant specializing in. utili:
~
1 regulation.
I have experience in providing expe:
- )
A 8
testimony regarding the rate treatment for
- electric, gat 9
telephone, sewer, and water utilities throughout the Units J '.
10' States.
I have testified in well over 100 utility ra
i 11 cases and in twenty dif ferent jurisdictions.
12 Q.
Please summarize your professional affiliations, h
o 13 A.
I am president of Rothschild Financial Consulting a :.
14 have been a
consultant since 1972.
Frcm 1979 throug 15
- January, 1985 I
was president of Georgetown Consultin i
16
- Group, Inc.
Prior to that, from 1976 to 1979 I was th.
17 president of J. Rothschild Associates.
Both of these fir.-
1 18 specialized in utility regulation.
Frcm 1972 through 197' 19 I
was employed as e consultant at Touche Ross & Co.
Muc!
3 pg
r-o e-1 of my censulting work done while at Touche Ross related to 2
' utility regulation.
dhile associated with~all of the coove 3
firms, I have worked f:r various state Utility Commissions, 4
Attorneys General, and Public Advocates on matters relating 5
to regulatory and financial :ssues.
These included rate of 6
- return, financial
- issues, and accounting iscues.
(See 7
Appendix.)
g 8
Q.
Please describe your eda a tional experience.
R 9
A.
graduated frem the University of Pittsburgh in 1967
~
10 vith a 3.3.
degrea in Cnemi:al Engineering, and from Case 11
'destern P.eserve Universi.ty in 1971 w;th an MBA in banking 12 and fin'ance.
El 13 Q.
Piccse describe your non-utility experience.
-14 A.
See the Appendix for a complete resume.
The statenents 1 '5 and description in the resure'are true and correct and were i
16 prepared under my direction and control.
I E
M 4
m
}
}
1 APPENDI.X C
Testifying Experience of James A. 5thschil.:
ALA3AMA Continental Telephone of the South; Docke: No. 17968 Rate
,i of Return, January, 1981.
t ARI7,0NA
,h Sun City West Utilities: Accounting, Ja: ua ry, 145 1*
i CONNECTICUT Connecticut Accrican Vater Cocpany; Docket No. 6:061'., Rate of Return, Septe=ber, 1980 Connecticut Light & Power Company; Docket No.
95-10-22, Accounting and Rate of Return, February, 1986 Connecticut Natural Gas:
Docket No. 730812, Accounting and Rate of Return, March, 1979 Connecticut Natural Gas Docket No. 830101, Rate of Return, March, 1983 DELAWARE Artesian Water Co=pany, Inc.;
Overall Cost of
- Capital, December, 1986 pn-Diacond State Telephone Company:
Docket No. 32-32, Rate of Ef Return, Nove=ber, 1982 Diamond State Telephone Company:
Docket No. 83-12, Rate of Return, October, 1933 V11=in3 ton Suburban Water Company; Rate of Return Report.
Septecher, 1986 Fl.0 RI D A 8
p
.;h y
J l
i Alltel of Florida:
Docket No.
650064-TL, Accounting,,
Septeober, 1935 Florida Power & Light Co:pany:
Docket No.
9:0002-EU, Rate g
of Return, July, 1981 1
Florida Power & Light Co c p a r. v : Docket No. 52007-EU, Rate of Return, June, 1982 Florida Power & Light Co=pany; Docket No.
530465-EI, i: a t e of Return ard CWIP, March, 1984 I
i Florida Power Corporation:
Dacket
o.
5 3 04 7 0- F. :.
- a:e Phase-In, June, '.964 Florida Progresa Corp.: Rate of Return. August, 1936 Culf Power Co=pcny; Docket No.
810 '. 3 6 - E'J. R a t e of Return,
. October, 1981 Gulf Power Company:
Docket No.
840066-EI, Rate cf Return, August, 1934 Rolling Oaka Utilities, Inc.;
Docket bo.
- 550941-W3, Accounting, October, 1986 Ta:pa Electric Cocpany; Docket No.
820007-EU, Rate of Return, June, 1982 Tampa Elcetric Company; Docket No.
830012-EU, Rate of Return, June, 1933 1
9 GEORGIA Georcia Power Co:pany; Docket No. 3397-U, Accounting, July, f
1983 l
- LLINDIS 4
)
\\
Central Illinois Public Service Cocpany; ICC Docket No. S6-i 0256, Financial ar.d Rate of Return, October, 1936 i
Commonwealth Edison Cocpany; Docket No.
8 5Ci.109 70, Financici Testiceny, May, 1986 Cocoonwealth Edison Company; Docket No. 66-0249, F i r.a n c i a l Teatimony, October, 1986 1
7-
.j r'.
Northern Illinois Gas
- Company, F;nancial
.\\ffidavit, February, 1987 KENTUCKY Ientucky Power Company:
Case No.-
S!.29 Rate of
- Return, April, 1962 Kentucky Power Co= par.y; Case No.
2 7 3 !.. Rate of R e t e r r, a :. d CWIP, June, 1933 Kentucky Power Cocpany:
Case No.
9061, Rate of Ruturr. and Rate Base Issues, Septecher, 1984 Vest Ecatucky Cao Company, Case No.
8227, Rate of Ret;rn, August, 1981-m-
MAINE Bangor llydro-Elcettic Company:
Docket No.81-136 Rate cf Return, January, 1982 MARYLAND C
P Telephone Cocpany; Case No.
- 7591, Fair
- Value, December, 1981 HASSACHUSETTS Boston Edison Company; Docket No. DPU 906, Rate of Return, December, 1991 Fitchburg Gas & Electric; Accounting and Finance, October, 1984 Southbridge Water Cocpany; M.D.P.U.,
Rate of
- Return, September, 1982 HINNESOTA Minnesota Power & Light Cocpany;. Docket No. E015/GR-80-76 Rate of Return, July, 1980 k'
g
r-s 3 'i 1
NEW JERSEY Atlantic City 3ewage; Docket No.
774-315, Eate af. Return, May, 1977 Elizabethtown Water Cocpaay; Docket No.
7 51 -6, A c c ou n :i n;;.
April, 1976 Elizabethtcwn Water Company; Docket No.
802-76, Pr:e of Return, January, 1979 Hackensack Water C o: p a r. y ; Scket No. 775-455, Octob..
19.<
and Accounting, February, 1979 Hackensack Water Co:pany; Docket Nc.
787-647, Accounting and.Interi: Rate Relief, September, 1978 Hackensack Water Company; AFUDC &-C' LIP, June, 1979 Hackensack Va t. c r Co:pany; Docket No.
804-275,
?,a t e of Return, Septe=ber, 1980 i
I Hackensack Water Company; Docket No.
8011-873,
- CWIP, January, 1931 sq Middlesex Water Company; Docket No. 793-254, Tariff Design, Septecber, 1978 Middlesex Vater Company; Docket No.
793-269, Rate of Return, June, 1979 Mount Holly Water Co=pany; Docket No.
805-314 Eate of Return, August, 1980 National Association of Water Cocpanies; Tariff Design.
1977 l
New Jersey Bell Telephone; Docket No.
7711-1047, Tariff Design, Septe:ber, 1978 New Jersey Land Title Insurance Companics, Rate of Return and Accounting, August and Nove=ber, 1985 New Jersey Natural Gas:
Docket No.
7812-1681, Rate of Return, April, 1979
-I Rockland E'.ectric Co=pany; Docket No.
795-413, Rate of Lvs 4
E
..M].
f~-
+
Return, October, 1979 South Jersey Gas Company; Docket No.
769-988, Accounting, Fibruary, 1977 United Artists Cablevision:
Docket No. CTV-9924-83, Rate of Return, April, 1984
.I Vest 'Icansburg ' dater Company; Docket No.
838-737, Cate of Return, December, 1983 NEW YORK Consolidated Edison Company:
Case No.27353, Accounting and
(
gE.4 Rate of Return, October, 1978 Consolidated Edison Company; Case No. 27744, Accour. ting and Rate of Return, August 1980 Q
Generic Financing Case for Electric & Gas Co= panics; Case No. 27679, Hay, 1981 N
-Long Island Lighting Company; Case No.
- 27136, Accounting-end Rate of Return, June, 1977 Long Island Lighting Company; Case
!io.
- 27774, Rate of Return, November, 1980 3
A.o n g Island Lighting Company; Case No.
28176 and 28177 Rate of Return and Revenue Forecasting, June, 1982 Long Island Lighting Co:pany, Case No.
- 28553, Rate of L
Return and Finance, March, 1984 i
New York Telephone, Case No. 27469, April, 1979 l
i New York Telephone, Case No. 27710, Accounting, Septe:ber, 1981 (P
OHIO Columbia Gas Co=pany of Ohio:
Case No.
77-1428-CA-AIR, March, 1979 I
O Colu=bia Gas Company of Ohio:
Case No.
78-1118-CA-AIR, Accounting and hate of Return, May, 1979 I
k 1
.~..
f.
% %ErW &
a m,
a-3 f ll
'Nd,}+LBusiness and Professional People for the Public Interest v
Telephone: (312) 6415570 y
Chicago. Ilhno s 60602
+
S.
109 North Dearborn Stre<>t Suite 1300
+
(
BY FEDERAL EXPRESS June 23, 1987 l
l i
l Thomas E.
Murley, Director Office of Nuclear Reactor Regulation U.S. Nuclear Regulatory Commission Washington, D.C.
20555 Re:
Byron 2 Operating License Amendment l
NRC docket no. 50-455
(
Dear Mr. Murley:
This letter provides a brief updated report on the status of Commonwealth Edison's proposal before the Illinois Commerce Commission (ICC) to restructure the ownership and other financial arrangements concerning the Byron 2 and Braidwood 1 and 2 nuclear units.
In brief, the proposal is still pending before the ICC, with no decision on regulatory approval now expected before July 6, l
1987.
In the meantime, the proposal is a moving target.
- First, l
on June 1, 1987, the ICC Staff recommended a number of amendments to the proposal, some of which bear on the financial l
qualifications (FQ) of Edison and the proposed subsidiary for NRC purposes.
Second, on June 8, Edison agreed to adopt some but not all of the ICC Staf f recommendations.
Third, on June 12, the ICC Hearing Examiners recommended adoption of most of the ICC l
Staff recommendations, and also added further recommended changes I
of their own.
Fourth, on June 16, the Illinois Supreme Court reversed an earler $495 million Edison rate increase for Byron 1, and remanded for further proceedings.
Most recently, during public meetings and oral argument during June 15-18, the members of the ICC discussed a number of potential additional amendments to the proposal, even more stringent than those recommended by the Examiners.
Some Cor.missioners expressed considerable concern about Edison's proposal.
It remains unclear whether the proposal will be approved and, i f so, subject to what changes and additional conditions.
Further ICC meetings to discuss the proposal have been scheduled for June 25 and 26, July 1 and July 6.
3
)
f t
.,oer o..~
s..n c...........
.mu-.
f.
(
e.,,,,,a e.
t
,. 9 D o,..m..
A 'o' # ' * '
U "IO O N*
- de
- ' ~
t n~~
A 8' N* S
,,,..sw, t
v :
,w.%
,a. e,,,,
,s.
.,.n
? n~'
4 'es /s
(.v.5,Pi j ' ""'" * # %
%( ( 4I E e'f P f IE 44 P64 8
(.I e i I
4' 'bbbf f r4 g
g l9 C d'iG ( b I, A,# It' $ N
,0 0
, ee.,4 k F
),, u < n.,r,n n s4 e, iii t,. < s v.,
t et t e' v D.i
+t L.e a e e v se <
se m
}. 4"{ bMI A4 F S'P sf l 9'8
I d 'J'dhPey f.'
1."
g
'*dV2d" F
hlty b& ' d'I
- 9 I "'\\ 8Ti r ' P k ( (<*h( '
,M (p
J 8
$ 4 ge y( $iP aJ 6go - r'(13 e f-P y
('fi.e 6 ( b. A PP 44 1 **
.**. t+a 1+4, u<*4 M4*,
o e cri v A,"$m # 1 o # r,*
- 1e m s 04't c e T
(?,.j4ti6s. I' d % \\#-
j lLt '
t '()
a s 'I s '
- 8
- EE 03 I' f J f /ve P 4
g 8
a= y %
4 9
,e-.....
u...,,
,....o e,
Y st J r
/
J
n 1.
ICC Staff Recommendations.
A copy of the specific changes to the Edison proposal recommended by the ICC Staff is attached as Attachment A.
Among others, they include:
Several recommended changes to the bonus-and-penalty provisions that would reduce the likelihood and amount of any bonuses, while increasing the likelihood and amount of any penalties.
A recommendation that if the subsidiary is to receive any bonuses, then it must also pay any penalties; otherwise, both the bonuses and the penalties should be paid by or to Edison.
That a $70 million refund recommended by the Examiner in another case, due to poor performance by LaSalle unit 1, not be waived, as part of Edison's " settlement", and that additional potential refunds of up to $106 million in pending cases also be preserved.
A requirement that the subsidiary establish an external tund for decommissioning.
Retention of the ICC's unrestricted right to reduce Edison's rates during the next 5 years, with no " statement of intent" not to do so, as Edison had requested.
2.
Edison Reply.
On June 4, Edison filed a reply to Staff suggestions.
A B.
Edison copy of Edison's reply is enclosed as Attachment l
opposed some of the changes on the ground that " Staff's proposal expands those risks well beyond those Edison bargained for, thereby changing the balance of the Agreement."
(Att.
B,
- p. 1.)
Edison agreed to other changes.
3.
Hearing Examiner's Recommendations.
On June 12, the ICC Hearing Examiners issued a 177-page proposed. Order on the Edison proposal.
A copy of pages 148-64, in which the Examiners adopted most of Staff's suggested changes and added some of their own, is enclosed herewith as~Attichment C.
Perhaps the most significant additional change involves Edison's right to terminate the agreement in the event the ICC reduces rates in the nex 5 years, or for other reasons.
The 2
I
r l
t 4
. Examiners recommend that prior ICC approval be required for any
- such~ termination.
This would appear to give the ICC greater
- flexibilityfto reduce Edison's rates, among other effects.
In
. oral argument'of June 17, Edison stated that it cannot accept this propopsed change.
4.
Illinois Supreme Court Decision.
On June 16 the Illinois Supreme Court decided People ex rel Hartigan-v.'ICC, docket no. 63747 (copy enclosed as Attachment "D"
hereto).
The Court reversed a $495 million rate increase-received 1by Edison ~for Byron 1 in October 1985, and remanded for further proceedings before the ICC to determine the' appropriate level of rate increase.
If a lower increase is granted (as is likely, in myLopinion), Edison's future revenues will of course be lower and, in addition, ratepayers will'be entitled to seek reparations for the excessive rates. collected after the date of the Supreme Court decision.
At oral argument on June 17, Edison indicated that it will still supprt its proposed " settlement" for Byron 2 and Braidwood, thereby assuming the risk of lower rates for Byron 1.
.While Edison professes' confidence that its rates will not be reduced on remand, substantial reductions and reparations are possible, since the issue involves the reasonableness of contruction expenditures at Byron 1.
5.
ICC Discussions.
The seven members of the ICC have not yet taken definitive positions on the Edison proposal.
During their discussions of June 15-18, however, considerable interest was expressed in the various changes recommended by their Staff and by the Examiners.
In addition, there was discussion of adding still tighter restrictions, such as strengthening the provision requiring IC'C approval for Edison's termination.
It remains, of course, too soon to predict how the ICC will rule.
CONCLUSION Even in its original form, Edison's proposal raised serious FQ issues, as set forth in my letter of April 29.
The numerous amendments now under consideration by the ICC raise further FQ issues.
As of now, the proposal is a " moving target".
No definitive NRC assessment can be made until after the f[nal version is approved by the ICC and then, within 10 days as 3
J
B e
M
\\
\\
j required by the Examiners' draf t order, agreed to by Edison - if, indeed, such approval and subsequent agreement occur at all.
For these reasons and those set forth in my April 29 letter, we urge the NRC not to make a finding of no signficant hazard
.l At such hearing BPI and Prior to an adjudicatory hearing on FQ.
)
SAFE stand ready to present the testimony of qualified experts on the Illinois legal and financial ramifications of Edison's proposal on the FC of Edison and its proposed subsidiary.
Expert l
l witnesses who have agreed to testify include Stephen Moore, Public Counsel of the State of Illinois, on the meaning of the and Charles Komanoff l
agreement and its effect under Illinois law; Vitae of Mr.
and James Rothschild on its financial ef fects.
Komanoff and Mr. Rothschild are attached hereto as Attachments E and F, respectively.
g Sincerely,
{9Qh l
Douglass W. Cassel, Jr./
One of the Attorneys for BPI and SAFE Encl.
cc:
Leonard N. Olshan U.S. Nuclear Regulatory Contmission 7920 Norfolk Avenue Be thesda, (4D. 20814 4
FHw< mMM f+ 3 Go BPI
' DM)
Business and Professional People for the Public Interest Chrcago. linno s 60602 Telephone (312) 6415570 1
109 North Dearbcrn Speet. Suae 1300
+
y
(
BY FEDERAL EXPRESS June 23, 1987 Thomas D.
Murley, Director Office of fluclear Reactor Regulation U.S. 11uclear Regulatory Commission Washington, D.C.
20555 Re:
Braidwood Units 1 and 2, Application for Amendment to Facility Operating License IJPF-70 and Appendix is, Technical Specif ications,11RC Docke t tio s. 50-456 and 50-457
Dear Mr. Murley:
For the reasons stated in my letters to you of April 29 and June 23, 1987, in docket 50-455 concerning Byron 2, BPI and Bridget Little Rorem, et al.,
intervenors in this docket, urge the t;RC not to approve Edison s request for an amendment of any operating license pertaining to Braidwood 1 or 2, and not to determine that no significant hazard exists, without first holding adjudicatory hearings on the serious financial qualifications issues raised by Edison's proposed restructuring of the ownership and other financial arrangements relating to Byron 2 and Braidwood 1 and 2.
BFI will be prepared to present the same witnesses in this docket as listed in my June 23 letter in the Byron 2 docket.
To avoid needless duplication, perhaps the hearings on FQ issues should be consolidated.
It appears that Edison's application for Braidwood is virtually ioentical to its application for Byron 2.
Thus the issues in the two caces will, in general, be identical.
There are at least two respects, however, in which the F2 questions relating to Braidwood are even more scrious than those relating to Byron 2.
Both points arise under option B of the Edison proposal, one of the two long-term options for what h
/
a.,,
,.. n :,
o 3,,,,
o... m..
b*'*.'
s A
g, p,a g*r n
,6
... e y
,g.
... v.',^
~ ~
J
'"...'l"
,'.,'"l,,
/; '
~
o,. u...
,',. ll. ' *. "
l'~
l,, ".. *,. T.
o.
1
. o..
m 1 o
,1,
- Te e
5 4'
r
.s.,
- s v,,
ae
,. j t
l
y:.
o h
-w.
--m m_._,,-..__y_._
7 c
\\
happens after the first 5 years of the Edison proposal.
Under option B, Edison would enter into a long-term power purchase contract for Byron 2.
In contrast, however, during 1992 through 2000 (or 1995 through 2000 if option C is selected), power from Braidwood 2 may be purchased by Edison only if it is (a) needed and (b) least cost.
Since the ICC Staft has already projected that Braidwood 2 power will not be needed by Edison prior to 2000, Braidwood 2's financial situation under option B during 1992-2000 is essentially the same -
i.e.,
lacking any regulatory assurance of cost recovery, and dependent upon market prices - as under option A.
Second, under option B, Braidwood unit 1, unlike Byron 2, potentially may not be purchased at all, or, if so, only in 100 Megawatt chunks, the amount of which may be reduced in 1997.
The i
unpurchased amount of Braidwood 1 - potentially the entire unit -
would then be in the same precarious position as Braidwood 2 under either option A or B, i.e.,
lacking any regulatory assurance of cost recovery.
In the case of Braidwood 1, that lack of regulatory 3
assurance would remain throughout the unit's life.
In the case 1
of Braidwood 2, the unit could be purchased by Edison (and thus brought back under a regulatory cost-recovery umbrella) in the year 2000, but only if the ICC were then willing to pemit Edison to pay the higher of cost or market price for the unit.
In short, the FQ issues for Braidwood are even more seridus than those for Byron 2.
Sincerely, g
Cf Douglass W.
Cassel, Jr.
One of the Attorneys for BPI and Intervenors Rorem, et al.
ec:
Jan Stevens U.S. Nuclear Regulatory Commission 7920 Nortolk Avenue Bethesda, MD. 20814 2
i ac,urUr
'2R JL -7 p 4 :48 CERTIFICATE OF SERVICE t
yr, 00t&
.?
Douglass W. Cassel hereby certify that I caused copie5"oI,
I, the foregoing Motion To Reopen The Record To Admit Late-Filed Contention On Financial Qualifications to be served on all Parties on the attached service list by depositing copies in the first class postage prepaid this 1st day of July 1987, U.S. mail, except that Ivan Smith, Esq., Chairman and Adminstrative Judge, Atomic Safety and Licensing Board was served by Federal Express on this same date.
yg tu q 7
vc 1
DouglassW.Cassel,Jr.f({},
l 1
SERVICE LIST Atomic Safety and Licensing Docketing & Service Section Board Panel Office of the Secretary U.S. Nuclear Regulatory U.S. Nuclear Regulatory Commission Commission Washington, D.C. 20555 Washington, D.C. 20555 Ivan Smith, Esq.
Region III Chairman and Administrative Office of Inspection &
Judge Enforcement Atomic Safety and Licensing U.S. Nuclear Regulatory Board Commission U.S. Nuclear Regualtory 799 Roosevelt Road Commission Glen Ellyn, IL. 60137 Washington, D.C.
20555 Joseph Gallo, Esq.
Richard F. Cole Isham, Lincoln & Beale Administrative Judge 1150 Connecticut Av., N.W.
Atomic Safety and Licensing Washington, D.C.
20036 Board U.S. Nuclear Regulatory Commission Washington, D.C.
20555 Michael I. Miller, Esq.
Peter Thornton, Esq.
Ishan, Lincoln & Beale i
A. Dixon Callihan Three First National Plaza Administrative Judge Chicago, IL. 60602 Atomic Safety and Licensing Board U.S. Nuclear Regulatory Commission Washington, D.C.
20555 C. Allen Bock, Esq.
P.O. Box 342 Urbana, IL. 61801 Stuary Treby, Esq.
NRC Staff Counsel U.S. Nuclear Regulatory Commission Bridget Little Rorem 7335 Old Georgetown Road 117 North Linden Street Bethesda, Maryland 20014 Essex, IL. 60935 l
Thomas J. Gordon, Esq.
Lorraine Creek Waller, Evans & Gordon Route 1, Box 182 2503 South Neil Manteno. IL. 60950 Champaign, IL. 61820
)
>