ML20238A659

NRC Staff Response to Intervenors Motion for Leave to File Suppl to Applications for Stay of Licensing Board Order Authorizing Operation Up to 5% Rated Power.* Certificate of Svc Encl

ML20238A659
Person / Time
Site:	Seabrook
Issue date:	08/17/1987
From:	Sherwin Turk NRC OFFICE OF THE GENERAL COUNSEL (OGC)
To:	NRC COMMISSION (OCM)
References
CON-#387-4245 OL-1, NUDOCS 8708210043
Download: ML20238A659 (13)

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, n '.RC UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION - '87 AUG 18 A10:37 l \

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in the Matter of ) .  ;

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PUBLIC SERVICE COMPANY OF ) Docket No. 50-443-OL-1' <

NEW HAMPSHIRE, et al.

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) 50-444 OL-1

) Onsite Emergency Planning l (Seabrook Station, Units 1 and 2) ) and Safety issues 1

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NRC STAFF'S RESPONSE TO INTERVENERS' MOTION FOR LEAVE TO FILE A SUPPLEMENT TO THEIR APPLICATIONS i FOR A STAY. OF LICENSING BOARD ORDER- AUTHORIZING {

OPERATION UP TO FIVE PERCENT OF RATED POWER- {

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l Sherwin E. Turk Senior Supervisory Trial Attorney l

August 17, 1987 8708210043 870817 J PDR ADOCK 05000443 G PDR ,

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UNITED STATES OF AMERICA

. NUCLEAR REGULATORY COMMISSION BEFORE THE COMMISSION s-In the Matter of ) .

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PUBLIC SERVICE COMPANY OF ) Docket No. 50-443-OL-1 .

NEW HAMPSHIRE, et al.

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) 50-444 OL ) Onsite Emergency Planning (Seabrook Station, Units 1.and 2) ) and Safety issues

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NRC STAFF'S RESPONSE TO INTERVENERS' MOTION FOR LEAVE TO FILE A SUPPLEMENT TO THEIR APPLICATIONS FOR A STAY. OF LICENSING BOARD ORDER AUTHORIZING OPERATION UP TO FIVE PERCENT OF RATED POWER l

1 Sherwin E. Turk Senior Supervisory Trial Attorney August 17, 1987

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' UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION l

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BEFORE THE COMMISSION l In the Matter of. ) .

l . ) Docket Nos. 50-443 OL-1 l 'PUDLIC SERVICE COMPANY OF ) 50-444 OL-1 NEW HAMPSHIRE, et al.

) Onsite Emergency Planning

) and Safety issues.  !

,, .( Seabrook Station, Units 1 and 2)

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NRC STAFF'S RESPONSE TO INTERVENERS' MOTION FOR LEAVE TO: FILE A SUPPLEMENT TO THElR APPLICATIONS FOR A STAY OF. LICENSING BOARD ORDER AUTHORIZING i OPERAT10N UP TO FIVE PERCENT OF RATED POWER l

INTRODUCTION On ~ July 31, 1987, the Town of Hampton, the New England Coalition '!

l on Nuclear Pollution (NECNP), and the Seacoast Anti-Pollution League l (SAPL) filed a motion for leave to supplement their earlier motions for a .l stay of the Licensing Board's Partial Initial Decision of March 25, 1987, which had authorized operation of Seabrook Unit 1 at up to 5% of rated power. O While the NRC Staff (" Staff") does not oppose the movants' l

i 1/ " Interveners' Motion For Leave to File A Supplement to Interveners' '

Applications for. A Stay of Licensing Board Order Authorizing

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Operation Up to Five Percent of Rated ' Power" (" Motion") , dated July 31, 1987. Simultaneously with the filing of their Motion, the i movants ' filed a petition under.10 C.F.R. 6 2.758, seeking a waiver of Commission regulations to require Applicants to demonstrate their financial qualifications to operate the facility at low power and to 1 decommission it following such operation. " interveners' Petition to Walve Regulations 50.33(f) and 50.57(a](4) to the Extent Necessary to Require Applicants to Demonstrate Financial Qualification to Operate and to Decommission Seabrook Station" (" Waiver Petition"),

dated July 31, 1987.

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3 request for leave to supplement their prior stay motions, for the reasons set - forth below, the Commission should find that the Motion does not provide grounds to stay the Licensing Board's Partial Initial Decision.,2,/

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DISCUSSl_ON The instant Motion is premised upon the movants' concern that if the  ;

Applicants are permitted to proceed to low power operation, they "may

. lack'the tens of millions of dollars necessary to promptly and permanently shut down the facility, and maintain it in a safe condition, i if a full power license is later denied" (Motion at 3; emphasis added). 3_/

in support of this belief, the movants cite a statement contained in a Securities and Exchange Commission Form 8-K filing of July 22, 1987, made by Public Service Company of New Hampshir e ("PSNH"), the lead

-2/ On January 9,11987, the Commission stayed the issuance of a low power license 'for Seabrook~ pending its review of ALAB-853, which stay was subsequently continued in effect pending the submittal of a bona fide offsite emergency plan for Massachusetts portions of the plume exposure pathway emergency planning zone (EPZ). See .i Pubile Service Co. of New Hampshire (Seabrook Station, Units 1 and 2), CLI-87-02, 25 NRC (April 9, 1987), motion to vacate )

denied, CLl-87-03, 25 NRC (June 11, 1987). The Applicants ]

recently announced that they will submit a bona fide compensatory _ l utility plan for Massachusetts portions of the E probably in 4 mid-September 1987.

3_/ Pursuant to Commission regulations, electric utility applicants are not required to demonstrate their financial qualifications in connection with an operating license application, and the Commission's adjudicatory boards are precluded from considering such matters In operating license proceedings. See 10 C.F.R. 59 50.33(f),

50.57(a)(4), and 6 2.104(c). Absent a determination by the Commission to walve these regulations (for instance, by granting the movants' pending petition for walver), no consideration should be given in the operating license proceeding to PS N H's financial condition in connection with the issuance of either a low power or a j full power operating license. Nonetheless , the Staff is following )

developments relating to PS N H 's financial condition. See n. 7, l infra. l 1

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9 Applicant and 35% owner of Seabrook. In that filing, PSNH . recounted recent difficulties it has had in securing short-term financing, stated that it had instituted " strict cash conservation measures that should allow it to meet its estimated cash requirements . . . through-the end of 1987", and -

- Indicated that it was attempting to develop " alternate financial plans".

PSNH further stated as follows:

Given the uncertainties surrounding the Company, its limited financial flexibility, the amount of debt service which the Company can reasonably expect to carry, the political, economic and competitive limits on rate increases in New Hampshire, and the regulatory l approvals that will be required , it will be extremely difficult to develop and implement such a plan to improve significantly the Company's circumstances within the lim'lted time available. Should an adequate plan not be develo aed and placed into effect before the end of 1987, it wil be difficult, if not impossible, for -

the Company to avoid proceedings under the Bankruptcy Code.

(Form 8-K for PSNH , Sheet 2, July 22,1987; emphasis added).

Based upon this filing, the movants assert (1) that "under present circumstances" PSNH is likely to file in bankruptcy; (2) that absent relief in the Bankruptcy Courts, PSNH is " financially incapable of continuing, '

for the period of the license, as an owner and/or operator" of Seabrook; (3) that absent such relief, " Applicants, as presently constituted, "have admitted to insuperable financlai obstacles to obtaining a full power ,

operating license"; and (4) that "there is no reasonable assurance that i

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Appilcants 'are financially quallfled to operate and to decommission

'Seabrook Station" (Motion at 2). b lt is incontrovertible that the recent Form 8-K filed by PSNH

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demonstrates .that the. company is encountering'se' vere financial strains , j

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which.. very well may -- but not necessarily will --

force it into bankruptcy. At this time, it clearly remains a matter of speculation as,to whether PSNH will or will not be able to develop and implement an adequate financial plan before having to file in bankruptcy. Such 4/

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The. Commission has adopted regulations governing licensees' requests to dismantle a facility and dispose of its component parts, i as well as regulations . with respect to reductions of residual radioactivity to levels acceptable for unrestricted access, onsite storage of spent . fuel, and physical safeguards of a facility, which may apply upon cessation of operation and decommissioning of the facility See, _e . g_. , 10 C.F.R. 56 50.82, 20.105, Part 70, and Part 73. In , addition, electric utilities ' are required to purchase property damage insurance which, inter alla, would provide funds to cover unanticipated decontamination costs in the event of an accident. See 10 C.F.R. 5. 50.54(w).

Commission regulations do not now require a demonstration of financial qualifications to decommission a facility, although a proposed rule change is pending which addresses this and other decommissioning issues. See Proposed Rule, " Decommissioning Criteria for Nuclear Facilities", 50 Fed. Reg. 5600 (Feb.11,1985).

Under this proposed rule, licensees would be required to provide

" reasonable assurance that adequate funds are available to ensure that decommissioning can be accomp!!shed in a safe manner and that lack of funds does not result in delays that may cause potential health and safety problems. " The proposed rule would require reactor applicants and licensees to provide information on funding ,

methods, and proposes a decommissioning fund of $100,000,000 (1984 dollars) per facility. In this regard, it should be noted that fission product build-up and plant contamination resulting from operation at  ;

5% power are likely to be far less than would be expected to result from full power operation and, consequently, the costs of decommissioning following low power operation -- even where the facility has operated at 5% power over an extensive period -- are ~

ilkely to be substantially less than the costs of decommissioning

. following full power operation. ,

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' speculation is . insufficient to support a determination 'either that PSNH will, in fact, file la bankruptcy , or 'that it would then be unable to obtain the funds necessary to operate at low power and maintain the in sum, the Motion facility- in'a safe condition following such operation.

makes a large speculative leap from an Indication that PSNH is encountering financial straits to the assertion that this may result in a

, lack 'of funds to " permanently shut down the facility and maintain it in a safe coridition if a full power license is later denied."

First, the Interveners' concern that funds may be unavailable for  !

I low power operation and permanent maintenance following shutdown is  !

I founded upon an assertion that a full power license ultimately. may be Q l

denied. However, the Motion provides no basis for assuming that a full power, license. may be denied. 5_/ - In this regard, the Commission has se previously Indicated,-(albeit in a different context) that uncertainty as to 4 1

the outcome' of litigation. on full power issues, and speculation as to whether a full power license ultimately will be issued , should not be considered in connection with issuance of a low power license, i i

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Similarly, a filing in bankruptcy by PSNH would not, by itself, appear to constitute an " insurmountable obstacle" to issuance of a full power license, nor do the Applicants appear to "have admitted to l Insuperable financial obstac'les to obtaining a full power license for j

, Seabrook" (Motion at 2). l

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,Long Island Lighting Co , (Shoreham Nuclear Power Station), CLl-84-9,19 ]

NRC 1323,1327 (1984). b Second, even if PSNH does file in bankruptcy, that circumstance, by itself, would not demonstrate that the composite-group of Applicants are financially incapable of operating and safely maintaining the facility.

Despite PS N H 's financial strait no reason has been presented which would suggest that any successer to PSNH (including either a reorganized company, an acquiring company, or e trurtee in bankruptcy), would not l pursue the company's application for a full power operating license and continue its effor ts to put the plant in commercial operation -- and thereby recover the company's considerable investment in the facility through its inclusion in the ratebase. - In this regard, if a full power license is issued , the facility is likely to be a source of substantial 6/ Accord, Long ' Island Lighting Co. (Shoreham Nuclear Power Station),

(1985), stay pending appeal

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C Li-85-12 , 21 NRC 1587, 1589-90 denied , Cuomo v. NRC, 772 F.2d 972, 975-76 (D.C. Cir. 1986),

yeaT dismissed as moot, a F.2d (D.C. Cir., March ,

1su7); Long Island Lighting 7o. (Shoreham Nuclear Power Station),

CLl-85-1, 21 NRC 275, 278-79 (1985). The Shoreham decisions held that an Environmental impact Statement was not required for low power licensing, despite the uncertainties surrounding the outcome of full power (offsite emergency preparedness) litigation.

<< Similarly, even if PSNH should lack the financial resources for low power operation, no reason has yet been presented to suggest that the remaining Seabrook owners -- who collectively own 65% of the facility -- lack the requisite financial resources, or will be unable or unwilling, to cover PSNH's share of the costs of low power operation and subsequent shutdown and maintenance, through either rate-making or application of capital fu nds . Nonetheless, the Staff is transmitting a letter to the Applicants requesting information as to the projected costs of low power operation and subsequent permanent shutdown and maintenance of the facility, as well as the sources and likelihood of availability of funds to cover such costs in the event that PSNH is unable to pay its share of the costs.

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revenue for its owners, whether one of those owners is PSNH or a l

successor company.

Third , no reason has been presented which would suggest --

contrary to the Commission's stated belief 8f s -that once a full power license is issued and the plant is placed into commercial operation, an electric utility such as PSNH (or any successor company) and the other

.Seabrook owners would be unable to recover the costs of safely maintaining and operating the facility through ratemaking proceedings before the governing public utility commissions. In the absence of any  !

reason to believe that such rate relief will be unavailable to PSNH or the remaining Applicants upon issuance of a full power license and commence-ment of commercial operation, the Motion falls to warrant a stay of the low power license.

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Statement of Consideration, " Elimination of Review of Financial Qualifications of Electric Utilities in Operating License Review and Hearings for Nuclear Power Plants", 49 Fed. Reg. 35747 (Sept.12, 1984). See also, Long Island Lighting Co. (Shoreham Nuclear Power Station, Unit 1), LBP-84-30, 20 NRC 426 (1984).

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CONCLUSION  !

For the reasons set forth above, the Motion does not warrant a stay i

.of the Licensing Board's Partial Initial Decision authorizing issuance of a I low power'llcense. -

- Respectfully submitted,  ;

/ (A w h, Snerwin E. Turk Senior Supervisory Trial Attorney Dated at Bethesda, Maryland this 17th day of August,1987 e

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l UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSIOE. 7 pg; 18 'N0 '38 p..  : .

BEFORE THE COMMISSION DOMj y a-

'In -the Matter of

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) Docket Nos. 50-443 OL-01 PUBLIC SERVICE COMPANY OF ) 50-444 OL-01 N EW HAM PS H I RE , e_t, al. ) On-site Emergency Planning

. ) and Safety Issues (Seabrook Station, Units 1 and 2) )

CERTIFICATE OF SERVICE I hereby certify that copies of "NRC STAFF'S RESPONSE TO INTERVENERS' MOTION FOR LEAVE TO FILE A SUPPLEMENT TO THElR APPLICATIONS FOR A STAY OF LICENSING BOARD ORDER AUTHORIZING OPERATION UP TO FIVE PERCENT OF RATED POWER" in the above-captioned proceeding have been served on the following by deposit in the United States mall, first class or, as indicated by an ' asterisk, by deposit in the Nuclear -

Regulatory Commission's internal mall system, this 17th. day of August 1987.

Sheldon J. Wolfe, Esq. , Chairman

• Dr. Emmeth A. Luebke* '

Administrative Judge, Administrative Judge

' Atomic Safety and Licensing Board Atomic Safety and Licensing Board U.S. Nuclear Regulatory Commission U.S. Nuclear Regulatory Commission Washington, DC 20555 Washington, DC 20555 Dr.

Jerry Harbour

• Ms. Carol Sneider, Esq.

.inistrative Judge Assistant Attorney General Atomic Safety and Licensing Board Office of the Attorney General U.S. Nuclear Regulatory Commission One Ashburton Place,19th Floor Washington, DC 20555 Boston, MA 02108 ,

l Beverly Hollingworth Richard A. Hampe, Esq.  ;

New Hampshire Civil Defense Agency 209 Winnacunnet Road Hampton , . N H 03842 107 Pleasant Street Concord, NH 03301 i

Sandra Gavutis, Chairman Calvin A. Canney, City Manager Board of Selectmen City Hall RFD 1 Box 1154 126 Daniel Street Kensington, NH 03827 Portsmouth, NH 03801 Stephen E. Merrill Paul McEachern, Esq.

Attorney General Matthew T. Brock, Esq.

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Stephen E. Merrill Paul McEachern, Esq.

' Attorney General Matthew T. Brock, Esq.

George Dana Bisbee Shaines S McEachern Assistant Attorney General 25 Maplewood Avenue Office of the . Attorney General P.O. Box 360 l 25 Capitol Street. Portsmouth, NH 03801 ,

Concord, NH 03301 --

Roberta C. Pevear

• Angle Machiros, Chairman State Representative Board of Selectmen Town of Hampton Falls i 25 High Road Drinkwater Road Newbury, MA 09150 Hampton Falls, NH 03844 Allen Lampert Mr. Robert J. Harrison Civil Defense Director President and Chief Executive . Officer Town of Brentwood Public Service Co. of New Hampshire j 20 Franklin Street P.O. Box 330 Exeter, NH 03833 . Manchester, NH 03105 Charles P. Graham, Esq. Robert A. Backus, Esq.

McKay, Murphy and Graham Backus, Meyer 6 Solomon 100 Main Street 116 Lowell Street Amesbury, MA 01913 Manchester, NH 03106 Diane Curran, Esq. Philip Ahren, Esq.

Harmon s Weiss Assistant Attorney General 2001 S Street, NW

Office of the Attorney General Suite' 430 State House Station #6 Washington, DC 20009 Augusta, ME 04333 Edward A. Thomas Thomas G. Dignan Jr., Esq.

' Federal Emergency Management Agency Ropes & Gray 442 J.W. McCormack (POCH) 225 Franklin Street Boston, MA 02109 Boston, MA 02110 i i

H.J. Flynn, Esq. William Armstrong  !

Assistant General Counsel Civil Defense Director Federal Emergency Management Agency Town of Exeter 500 C Street, SW 10 Front Street Washington, DC 20472 Exeter, NH 03833

, i Atomic Safety and Licensing Atomic Safety and Licensing i Appeal Panel

• Board

• U.S. Nuclear Regulatory Commission U.S. Nuclear Regulatory Commission ,

Washington, DC 20555 Washington, DC 20555 1 l

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[. i L Jane Doughty Docketing and Service Section* i Seacoast Anti-Pollution League Office of the Secretary j

Market Street U.S. Nuclear Regulatory Commission l 1.. Portsmouth, NH 03801- Washington, DC 20555 {

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L Maynard L. Young, Chairman .

William S. Lord ,

Board of Selectmen Board of Sefecfmen 10 Central Road Town Hall - Friend Street South Hampton, NH 03287 Amesbury, ' MA 01913 4

Michael Santosuosso, Chairman Peter J. 'Matthews, Mayor Board of Selectmen City Hall South Hampton, NH 03287 Newburyport, MN 09150 '

' Mr. Robert Carrigg, Chairman Judith H. Mizner, Esq.

Board of Selectmen Silverglate, Gertner, Baker t Town Office Fine and Good 1 Atlantic Avenue .

88 Broad Street North Hampton, NH 03862 Boston, MA 02110 R. K. Gad lil, Esq. Mrs. Anne E. Goodman, Chairman Ropes 6 Gray Board of Selectmen ,

225 Franklin Street 13-15 Newmarket Road Boston, .MN ' 02110 Durham, NH 03824 Gary W. Holmes, Esq.'- ae Holmes & Ellis -

' 47 Winnacunnet Road

Hampton, NH 03842 j p. <

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Sherwin E. Turk Senior Supervisory Trial i Attorney  !

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