ML20235P228

Forwards Application for Amend to License DPR-64 & Approval in Connection W/Sale & Leaseback Transactions by Duquesne Light Co.Fee Paid

ML20235P228
Person / Time
Site:	Beaver Valley
Issue date:	07/16/1987
From:	Doris Lewis SHAW, PITTMAN, POTTS & TROWBRIDGE
To:	NRC OFFICE OF ADMINISTRATION & RESOURCES MANAGEMENT (ARM)
Shared Package
ML20235P231	List: ML20235P228 ML20235P834
References
NUDOCS 8707200403
Download: ML20235P228 (12)

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j SHAW, PITTMAN,- PoTTs & TROWBRIDGE A PARTNERSHIP INCLUDING PROFESSIONAL CORPORATIONS l' 2300 N ETRECT, N. W.

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i July 16, 1987 U.S. Nuclear Regulatory Commission Att'n: Document Control Desk Washington, D.C. 20555 l

l l In the Matter of I

Duquesne Light Company (Beaver Valley Power Station, Unit 2)

Docket No. 50-412 Dear Sirs Please find enclosed an Application for License Amendment and Approval in Connection with Sale and Leaseback Transactions by Duquesne Light Company. This application is distinct from the application filed on July 14, which was submitted in connection with sale and' leaseback transactions by Ohio Edison' Company. In accordance with 10 C.F.R. S 50.4, copies of this application have been sent to the NRC Region I Office and to the Resident Inspec-tor for the Beaver Valley Power Station, Unit 2. Also enclosed is a check for the $150.00 filing fee.

! Sincerely,

' s l David R. Lewis i Counsel for Applicants

!- Enclosure l cc: (w/ encl.): U.S. NRC Region I l NRC Resident Inspeqtor, BVPS A #co -

B7072OO403 070716 PDR E yS 9 M 1 1 ADOCK 05000412E- '

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Duquesne Light Company et al.:

Consideration of Issuance of Amendment to Facility Operating License and Proposed No Significant Hazards Consideration Determination and Opportunity for Hearino (Docket No. 50-412]

The U.S. Nuclear Regulatory Commission (the Commission) is considering issuance of an amendment to Facility Operating License No. NPF-64 issued to Duquesne Light Company (DL),

Cleveland Electric Illuminating Company, Ohio Edison Company, and Toledo Edison Company for operation of the Beaver Valley Power Station, Unit 2, located in Beaver County, Pennsylvania.

The proposed amendment would allow sale and leaseback trans-actions by DL relating to its 13.74% ownership interest in BVPS Unit 2'and common facilities, in accordance with the licensee's application for amendment dated July 16, 1987. Specifically, the application requests authorization for DL's transfer of all or a portion of its interests in BVPS Unit 2 to equity investors and for the simultaneous transfer by the equity investors back to DL of a long term (approximately 29.5 years) possessory leasehold interest of these shares under the terms described in the appli-cation and other identified documents.

It is contemplated that the equity investors will be third parties not affiliated with DL. These equity investors might in-clude electric utilities, or affiliates or subsidiaries thereof, a

t in.which case antitrust considerations may be present. Under the proposed transaction, it is represented that DL will remain in possession of its partial interest in the BVPS facilities under leaseholds rather than by virtue of ownership. DL will continue to be the sole licensed operator of the facility. DL will have the full and exclusive authority and responsibility to exercise and perform all of its rights and duties as a party to the BVPS operating agreement. DL will also retain its responsibility for the payment of its share of the operating and maintenance expens-es and costs of capital improvements during the term of the leaseholds and thereafter, in the absence of other Commission ac-tion, for its share of the cost of decommissioning BVPS Unit 2.

The proposed amendment is similar to a request filed on October 18, 1985, by Arizona Public Service Company (APS) regard-ing the sale and leaseback transactions by Public Service Company of New Mexico (PNM) of a portion of PNM's ownership interests in Palo Verde Nuclear Generating Station (PVNGS) Unit 1. See 50 FR 45955. By Order of December 1, 1985, the Commission approved the proposed sale and leasehack transactions and authorized the amendment of the PVNGS Unit 1 license subject to certain condi-tions. On December 26, 1985, the PVNGS Unit 1 license was amended and conditioned pursuant to the Commission's order. See 51 FR 1883.

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The Commission has received and approved requests for addi-tional similar transactions related to sale and leaseback of Palo Verde Units 1 and 2 ovnership shares by PNM (see 51 FR 8259, 51 FR 8587, 51 FR 9125 and 51 FR 40275) and requests far similar transactions related to sale and leaseback of Palo Verde Unit 2 ownership shares by El Paso Electric Company (see 51 FR 20366 and 51 FR 40275) and by Arizona Public Service Company (see 51 FR 20367 and 51 FR 40275). On June 21, August 12 and 15, and December 11, 1986, the PVNGS Units 1 and 2 licenses were amended to allow the requested sale and leaseback transactions. The Com-mission has also received a request for approval of similar transactions related to the sale and leaseback of the Perry Nuclear Power Plant, Unit 1, by Ohio Edison Company (see 52 FR 4432) and amended the Perry Unit 1 license on March 16, 1987 to allow the transactions.

This application proposes that the BVPS Unit 2 license be amended and conditioned in the same menner, by adding the follow-ing new paragraph 2.B(7): 1!

1/ On July 14, 1987, DL filed on behalf of Ohio Edison Company an application for approval of similar transactions by Ohio Edison. If both DL's and Ohio Edison's transactions are ap-proved, the first sentence of the license condition autho-rizing the transactions would state, "Duquesne Light Company and Ohio Edison Company are authorized to transfer any por-tion of their respective 13.74% and 41.88% interests in BVPS Unit 2 and a proportionate share of their interests in BVPS common facilities to certain equity investors identified in their submissions of . . . "; and the third sentence of the license condition would refer to both applications.

(a) Duquesne Light Company is authorized to transfer any portion.of its 13.74% interest in BVPS Unit.2 and a proportionate share of its. interest in the BVPS common facilities to certain equity investors identified in its submission of , and at the same time to

. lease back from such purchasers such interest transferred in the BVPS Unit 2 facility. The tern of the lease is for approximately 29.5 years subject to a right of renewal. Such sale and leaseback transactions are subject to the representations and conditions set forth in the aforementioned application of July 16' 1987, as well as the letter of the Director of the Office of Nuclear Reactor PagulsLion dated , consenting to such transactions. Specifically, a lessor and anyone else who may acquire an interest under these transactions are prohibited from exer-cising directly or indirectly any control.

over the license of BVPS, Unit 2. For pur-poses of this condition the limitations in 10 CFR 50.81, as now in effect and as may be subsequently amended, are fully applicable to the lessor and any successor in interest to that lessor as long as the license for BVPS Unit 2 remains in effect; the financial transactions shall have no effect on the license for the BVPS Unit 2 facilit throughout the term of the license.y (b) Further,.the licensees are also required to notify the NRC in writing prior to any change in: (i) The terms or conditions of any lease agreements executed as part of these transac-tions, (ii) the BVPS Operating Agreement, (iii) the existing property insurance cover-age for BVPS, Unit 2, and (iv) any action by a lessor or others that may have an adverse effect on the safe operation of the facility.

Before issuance of the proposed license amendment, the Com-mission will have made findings required by the Atomic Energy Act of 1954, as amended, (the Act) and the Commission's regulations.

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The Commission has made a proposed determination that the j l

amendment request involves no significant hazards consideration. i Under the Commission's regulations in 10 CFR 50.92, this means that operation of the facility in accordance with the proposed amendment would not: (1) involve a significant increase in the probability or consequences of an accident previously evaluated; i

or (2) create the possibility of a new or different kind of acci-dent from any accident previously evaluated; or (3) involve a i significant reduction in a margin of safety.

The above determination is based upon the fact that the pro-posed amendment would not change or affect any aspect of the plant design, criteria or operation. The amendment would main-tain DL in' possession of its present interests in BVPS Unit 2 and DL would continue to be obligated to pay its share of all costs of construction, maintenance, operation, capital improvements and decommissioning. The equity investors would not have any rights of possession in, absent further license amendment, or control over BVPS Unit 2. DL would continue to be the sole licensee au-thorized to use and operate the facility.

Based on the above considerations, the staff has concluded that the proposed amendment meets the criteria in 10 CFR 50.92(c). The Commission, therefore, proposes to determine that the requested amendment does not involve significant hazards con-siderations.

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The Commission is seeking public comments on this proposed

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determination. Any comments received within 30 days after the 1 date of publication of this notice will be considered in making any final determination. The Commission will not normally make a i final determination unless it receives a request for a hearing.

Written comments may be submitted by mail to the Rules and Procedures Branch, Division of Rules and Records, Office of Ad-ministration, U.S. Nuclear Regulatory Commission, Washington, D.C. 20555, and should cite the publication date and page number of this Federal Register notice. Written comments may also be i

delivered to Room 4000, Maryland National Bank Building, 7735 Old Georgetown Road, Bethesda, Maryland from 7:30 a.m. to 4:30 p.m.

Copies of written comments received may be examined at the NRC Public Document Room, 1717 H Street, N.W., Washington, D.C. The filir.g of requests for hearing and petitions for letve to inter-vene is discussed below.

By , 1987, the Licensee may file a request for a hearing with respect to issuance of the amendment to the subject facility operating license and any person whose interest may be affected by this proceeding and who wishes to participate as a party to the proceeding must file a written petition for leave to inter-vene. Request for a hearing and petitions for leave to intervene shall be filed in accordance with the Commission's " Rules of Practice for Domestic Licensing Proceedings" in 10 CFR Part 2.

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If a request for a hearing or petition for leave to intervene is I

filed by the above date, the Commission or an Atomic Safety and i Licensing Board, designated by the Commission or by the Chairman of the Atomic Safety and Licensing Board Panel, will rule on the  ;

i request and/or petition and the Secretary of the Designated Atom- '

ic Safety and Licensing Board will issue a notice of hearing or an appropriate order.

I As required by 10 CFR 2.714, a petition for leave to inter-vene shall set forth with particularity the interest of the peti-tioner in the proceeding, and how that interest may be affected 1

by the results of the proceeding. The p.s ition should specif1-  ;

cally explain the reasons why intervention should be permitted with particular reference to the following factors: (1) the na-ture of the petitioner's right under the Act to be made a party to the proceeding; (2) the nature and extent of the petitioner's property, financial, or other interest in the proceeding; and (3) the possible effect of any order which may be entered in the pro-ceeding on the petitioner's interest. The petition should also identify the specific aspect (s) of the subject matter of the pro-ceeding as to which petitioner wishes to intervene. Any person who has filed a petition for leave to intervene or who has been l admitted as a party may amend the petition without requesting leave of the Board up to fifteen (15) days prior to the first i

prehearing conference scheduled in the proceeding, but such an l

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1 amended petition must satisfy the specificity requirements de-scribed above.

Not later than fifteen (15) days prior to the first prehearing conference scheduled in the proceeding, a petitioner shall file a supplement to the petition to intervene which must include a list of the contentions which are sought to be liti-gated in the matter, and the bases for each contention set forth with reasonable specificity. Contentions shall be limited to matters within the scope of the amendment under consideration. A petitioner who fails to file such a supplement which satisfies these requirements with respect to at least one contention will not be permitted to participate as a party.

Those permitted to intervene become parties to the proceed-ing, subject to any limitations in the order granting leave to intervene, and have the opportunity to participate fully in the conduct of the hearing, including the opportunity to present evi-dence and cross-examine witnesses.

If a hearing is requested, the Commission will make a final determination on the issue of no significant hazards considera-tion.

The final determination will serve to decide when the hearing is held.

If the final determination is that the amendment request in-volves no significant hazards consideration, the Commission may I

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issue the amendment and make it effective, notwithstanding the request for a hearing. Any hearing held would take place after o issuance of the amendment.

1 If the final determination is that the amendment involves a significant hazards consideration, any hearing bald would take place before the issuance of any amendment.

Normally, the Commission will not issue the amendment until the expiration of the 30-day notice period. However, should cir-cumstances change during the notice period such that failure to act in a timely way would result in derating or shutdown of the facility, the Commission may issue the license amendment'before the expiration of the 30-day notice period, provided that its I'

final determination is that the amendment involves no significant hazards consideration. The final determination will consider all public and State comments received. Should the Commission take this action, it will publish a notice of issuance and provide for opportunity for a hearing after issuance. The Commission expects that the need to take this action occurs very infrequently.

A request for a hearing or a petition for leave to intervene must be filed with the Secretary of the Commission, U.S. Nuclear Regulatory Commission, Washington, D.C. 20555, Att: Docketing and Service Branch, or may be delivered to the Commission's Public Document Room, 1717 H Street, N.W. Washington, D.C. by the above l

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date. Where petitions are filed during the last. ten (10)' days of the notice. period, it is requested that the petitioner promptly so inform the Commission by a toll-free telephone call to Western

' Union at-(800) 325-6000 (in Missouri (800) 342-6700). The West-ern Union' operator should be given Datagram Identification Number and the following message addressed to J. Stolz, Director, Project Directorate No. I-4, Division of Reactor Projects I/II; petitioner's name and telephone number; date petition was mailed; plant name; and publication date and page number of this Federal Register notice. A copy of the petition should also be sent to the Executive Legal Director, U.S. Nuclear Regulatory Commission, Washington, D.C. 20555, and to David R. Lewis, Esq., Shaw, Pittman, Potts & Trowbridge, 2300 N Street, N.W., Washington, D.C. 20037, attorney for the licensee.

Nontimely filings of petitions for leave to intervene, amended petitions, supplemental petitions and/or requests for hearing will not be entertained absent a determination by the Commission, the presiding officer or the presiding Atomic Safety and Licensing Board, that the petition and/or request should be granted based upon a balancing ci factors specified in 10 CFR 2.714(a)(1)(i)-(v) and 2.714(d).

For further details with respect to this action, see the ap-plication for amendment dated July 16, 1987, which is available l for public inspection at the Commission's Public Document Room, i

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1717 H Street, N.W., Washington, D.C. 20555, and at the B.F.

Jones Memorial Library, 663 Franklin Avenue, Aliquippa, Pennsylvania, 15001.

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