ML23186A163
| ML23186A163 | |
| Person / Time | |
|---|---|
| Site: | Diablo Canyon  |
| Issue date: | 06/13/2023 |
| From: | Atomic Safety and Licensing Board Panel |
| To: | |
| SECY RAS | |
| References | |
| RAS 56724, NRC-2422, 72-26-ISFSI-MLR, ASLBP 23-979-01-ISFSI-MLR-BD01 | |
| Download: ML23186A163 (0) | |
Text
Official Transcript of Proceedings NUCLEAR REGULATORY COMMISSION
Title:
Pacific Gas and Electric Company, Diablo Canyon Independent Spent Fuel Storage Installation Docket Number: 72-26-ISFSI-MLR ASLBP Number: 23-979-01-ISFSI-MLR-BD01 Location: teleconference Date: Wednesday, June 13, 2023 Work Order No.: NRC-2422 Pages 1-71 NEAL R. GROSS AND CO., INC.
Court Reporters and Transcribers 1716 14th Street, N.W.
Washington, D.C. 20009 (202) 234-4433
1 1 UNITED STATES OF AMERICA 2 NUCLEAR REGULATORY COMMISSION 3 + + + + +
4 ATOMIC SAFETY AND LICENSING BOARD PANEL 5 + + + + +
6 HEARING 7 --------------------------x 8 In the Matter of: :
9 PACIFIC GAS AND ELECTRIC : Docket No.
10 COMPANY, INC. : 72-26-ISFSI-MLR 11 : ASLBP No.
12 : 23-979-01-ISFSI-MLR-BD01 13 (Diablo Canyon :
14 Independent :
15 Spent Fuel Storage :
16 Installation) :
17 --------------------------x 18 Wednesday, June 13, 2023 19 BEFORE:
20 E. ROY HAWKENS, Chair 21 NICHOLAS G. TRIKOUROS, Administrative Judge 22 JUDGE GARY S. ARNOLD, Administrative Judge 23 24 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
2 1 APPEARANCES:
2 On Behalf of PG&E, Inc.:
3 RYAN K. LIGHTY, ESQ.
4 PAUL BESSETTE, ESQ.
5 of: Morgan, Lewis & Bockius LLP 6 1111 Pennsylvania Avenue, N.W.
7 Washington, DC 20004 8 ryan.lighty@morganlewis.com 9 paul.bessette@morganlweis.com 10 On Behalf of San Luis Obispo Mothers for Peace:
11 DIANE CURRAN, ESQ.
12 of: Hamon, Curran, Spielberg & Eisenberg, LLP 13 1725 DeSales Street, N.W.
14 Suite 500 15 Washington, DC 20036 16 dcurran@harmoncurran.com 17 On Behalf of the Nuclear Regulatory Commission:
18 ADAM S. GENDELMAN, ESQ.
19 CATHERINE E. KANATAS, ESQ.
20 of: Office of the General Counsel 21 Mail Stop - O-14A44 22 U.S. Nuclear Regulatory Commission 23 Washington, D.C. 20555-0001 24 adam.gendelman@nrc.gov 25 catherine.kanatas@nrc.gov NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
3 1 C-O-N-T-E-N-T-S 2 PAGE 3 Presentation by Diane Curran, Counsel for 4 San Luis Obispo Mothers for Peace 6 5 Presentation by Ryan Lighty, Counsel for PG&E 26 6 Presentation by Adam Gendelman, Counsel for 7 Nuclear Regulatory Commission 48 8 Rebuttal by Diane Curran, Counsel for 9 San Luis Obispo Mothers for Peace 64 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
4 1 P R O C E E D I N G S 2 1:01 p.m.
3 JUDGE HAWKENS: And with that, we'll go on 4 the record, please. Good afternoon. Today, we'll 5 hear oral argument in a license renewal proceeding 6 entitled Pacific Gas and Electric Company, Diablo 7 Canyon Independent Spent Fuel Storage Installation, 8 Docket No. 72-26-ISFSI-MLR.
9 Petitioner, San Luis Obispo Mothers for 10 Peace, challenges the application submitted by PG&E to 11 renew its license for the independent spent fuel 12 storage installation at the Diablo Canyon Nuclear 13 Plant. And as an aside going forward, you may hear 14 judges and counsel use the acronym ISFSI when 15 referring to the independent spent fuel storage 16 installation.
17 My name is Roy Hawkens. I'm a legal 18 judge. I chair this licensing board, and I'm joined 19 by Technical Judge Nic Trikouros and Technical Judge 20 Dr. Gary Arnold, both who have an expertise in nuclear 21 engineering.
22 Our Board is assisted by our law clerk 23 Noel Johnson. And we also are receiving support 24 remotely from law clerk Allison Wood. The argument is 25 being held in the hearing room at the NRC Headquarters NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
5 1 in Rockville, Maryland. And we welcome counsel and 2 the audience.
3 A listen-only telephone line has been made 4 available for those who could not be here today. And 5 a court reporter is preparing a transcript that will 6 be placed in the NRC's electronic hearing docket 7 within a week. As I mentioned, this proceeding 8 involves a challenge to PG&E's application to renew 9 its license for the ISFSI located at the Diablo Canyon 10 Power Plant.
11 Petitioner has proffered two contentions 12 challenging that application. First, it argues the 13 information in the renewal application regarding 14 PG&E's financial qualification to operate and 15 decommission the facility is deficient because it's 16 based on the incorrect assumption that the reactors at 17 the Diablo Canyon Power Plant will be retired in 2024 18 and 2025. Second, it argues a portion of the 19 environmental report supplement is deficient for the 20 same reason.
21 Before licensing board will grant a 22 hearing request, the petitioner must demonstrate 23 standing and must offer two admissible contentions.
24 The litigants agreed to those issues, and the 25 licensing board has read those briefs. Petitioner NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
6 1 argues the hearing request should be granted because 2 it has standing and it offers two admissible 3 contentions.
4 PG&E does not dispute petitioner's 5 standing, but it argues that neither contention is 6 admissible. And therefore, the hearing request should 7 be denied. The NRC staff on the other hand argues the 8 hearing request should be granted because petitioner 9 has established standing and it proffers one 10 admissible contention. For the record, would counsel 11 please introduce themselves and any colleagues who are 12 accompanying them starting with petitioner, please?
13 MS. CURRAN: Good afternoon. My name is 14 Diane Curran. I'm appearing for San Luis Obispo 15 Mothers for Peace.
16 JUDGE HAWKENS: Thank you, Ms. Curran.
17 PG&E?
18 MR. BESSETTE: Good afternoon, Your Honor.
19 I'm Paul Bessette, counsel for Pacific Gas and 20 Electric. With me is Ryan Lighty who'll be conducting 21 the oral argument with you. And behind me is my 22 colleague Tim Matthews, Partner at Morgan, Lewis. We 23 also have a summer intern with us, Jake Negvesky, 24 who's observing the proceedings.
25 JUDGE HAWKENS: Thank you. NRC staff?
NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
7 1 MR. GENDELMAN: Good afternoon. My name 2 is Adam Gendelman. I'm an attorney in Material Cycle 3 and Waste Division in the NRC Office of General 4 Counsel. With me is Catherine Kanatas and some NRC 5 technical staff are in the gallery, Mr. James Park, 6 Mr. Trent Wertz, and Dr. Christopher Markley.
7 JUDGE HAWKENS: All right. Thank you.
8 Each litigant has been allotted 40 minutes to present 9 argument. Petitioner will go first, followed by PG&E, 10 and followed by the NRC staff. And Petitioner may 11 reserve up to ten minutes for rebuttal. The Board's 12 law clerk, Ms. Johnson, will be keeping track of time.
13 During the course of your argument, the 14 green light will be illuminated. When five minutes 15 are left, you'll see the yellow light. And when time 16 has elapsed, you'll see the red light at which time 17 we'd ask counsel to wrap up their arguments promptly 18 unless the Board has an issue on questions. At this 19 stage, does counsel have any questions?
20 (No audible response.)
21 JUDGE HAWKENS: Seeing that nobody does, 22 let me ask Judge Trikouros, anything to add before we 23 proceed?
24 JUDGE TRIKOUROS: No, thank you.
25 JUDGE ARNOLD: No.
NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
8 1 JUDGE HAWKENS: Ms. Curran, do you --
2 MS. CURRAN: I'm ready.
3 JUDGE HAWKENS: -- desire to reserve any 4 time for rebuttal?
5 MS. CURRAN: Yes, I would like to reserve 6 ten minutes, please.
7 JUDGE HAWKENS: Very well. You may 8 proceed. Thank you.
9 MS. CURRAN: Thank you. Good afternoon.
10 And I first want to thank you all for accommodating me 11 when I needed to postpone the oral argument for health 12 reasons. I'm doing fine, but I needed that day. And 13 I really appreciate it. Thank you.
14 JUDGE HAWKENS: You're welcome. We're 15 grateful to counsel for accommodating you with your 16 request as well.
17 MS. CURRAN: Yes, same to the counsel.
18 Just before we start in on the contentions, I want to 19 set a little background on this because our concerns 20 arise from the fact that PG&E submitted its license 21 renewal application in March of 2022 when its plans 22 for the Diablo Canyon reactor were completely 23 different than they are today. As you know, today the 24 NRC has granted -- recently, the NRC granted PG&E an 25 exemption from the timely renewal rule to put in a new NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
9 1 license renewal application which if PG&E submits it 2 by December of 2023 will allow it to get the 3 protection of the timely renewal rule.
4 And as far as we know, PG&E is planning to 5 submit a license renewal application for the reactors 6 even though the State of California and the bill had 7 passed in September, said that they would limit the 8 operation to five years. They left it a little open 9 ended.
10 And as far as we know, PG&E is planning to 11 apply for a 20-year renewal of the reactor licenses.
12 And as the NRC says in its response to our 13 contentions, the operation of the reactors is related 14 to the ISFSI. It was the motivation for the licensing 15 of the ISFSI in the first place.
16 So here we are because PG&E submitted the 17 ISFSI license renewal application back when they 18 thought they were going to close the reactors in 2024-19 2025. And the only purpose of the ISFSI if that were 20 true would be to have a safe place to store spent fuel 21 until the repository opens. There's no need to talk 22 about the operation of the facility. It was 23 essentially ending.
24 Our concerns arise from the fact that PG&E 25 hasn't amended its application even though it's known NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
10 1 since September that it was planning to do something 2 different or it might do something different. And 3 it's known since October when it requested the NRC to 4 issue the exemption that it wanted to submit a new 5 license renewal application. We have two contentions.
6 The first contention relates to financial 7 assurance for operation -- safe operation of the ISFSI 8 and also decommissioning of the ISFSI. Again, in both 9 instances, the representations made by PG&E and the 10 license renewal application are that PG&E is going to 11 operate the ISFSI for only a few more years and then 12 -- or it will operate it for a long time but under the 13 current regime of getting funding from the rate payers 14 only a few more years. And then it will tap into the 15 decommissioning trust fund to operate the ISFSI.
16 And the same thing for decommissioning, 17 that as far as they knew back then, they were going to 18 start decommissioning right away. And as PG&E says in 19 appendix -- page G-4 of its appendix, for purposes of 20 providing an estimate for a funding plan, financial 21 assurance is expected to be provided based on a prompt 22 ISFSI decommissioning scenario. So that timing of 23 decommission affects the cost of decommissioning.
24 It affects where PG&E is going to get the 25 money for decommissioning. And in our view, the NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
11 1 application should be accurate. It's required by the 2 NRC regulations which are there to protect the public, 3 there to protect the safety of the ISFSI operation.
4 We know that we have historic examples 5 where not enough money was set aside for maintaining 6 nuclear waste. And these regulations evolved out of 7 that. We also have a situation where --
8 JUDGE HAWKENS: May I interrupt? One --
9 MS. CURRAN: Of course.
10 JUDGE HAWKENS: -- quick question. And I 11 want to hear more about your contention of 12 admissibility after this. But at the outset, although 13 nobody has challenged standing, and in fact, the NRC 14 staff agrees standing, as you know, the Board has an 15 independent obligation to verify that standing exists.
16 And I was wondering if you could just summarize your 17 views of standing and which of the members of the 18 petitioner has standing under established case law.
19 MS. CURRAN: Yes. Well, we rely on the --
20 principally on the licensing board's decision with 21 respect to spent fuel storage in the original ISFSI 22 licensing proceeding in which members of San Luis 23 Obispo Mothers for Peace who live within a few miles 24 of a reactor or within 18 miles actually were found to 25 have standing.
NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
12 1 JUDGE HAWKENS: Seventeen miles, I 2 believe.
3 MS. CURRAN: Was it seventeen? Okay. We 4 have members living within six miles. This is a very 5 large quantity of radioactive material. And if there 6 were any kind of airborne release of this material, 7 the licensing board has found it's reasonable to 8 conclude that this could affect people living near the 9 facility.
10 If the Board is thinking of reconsidering 11 that decision, we would really appreciate an 12 opportunity to brief it more fully. The issue has 13 been briefed in detail in a case in the D.C. Circuit 14 involving a centralized storage facility in Texas.
15 And we'd be glad to provide you with all that legal 16 briefing if you wish.
17 JUDGE ARNOLD: Could I just mention, in 18 the Bell Bend case, CLI-10-07, the commission said, 19 our case law is clear that a petitioner must make a 20 fresh standing demonstration in each proceeding in 21 which intervention is sought. So that sounds to me as 22 though they're ruling out basing your standing on a 23 previous case where you establish standing.
24 MS. CURRAN: Judge Arnold, I have a little 25 different interpretation of that precedent. I don't NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
13 1 think that -- I don't think it's saying that previous 2 decisions have to be revisited. I think what it's 3 saying is you can't come in and say a few years ago 4 you found we had standing, and we're not going to put 5 in standing affidavits again.
6 We did that. I don't think -- and I could 7 be wrong. But I don't think that decision is saying 8 all previous decisions are up for reconsideration.
9 It's saying petitioners can't rely on previous 10 standing declarations or any kind of representations 11 regarding your standing. And we have done all that 12 beforehand. We had new standing declarations from a 13 number of Mothers for Peace members.
14 JUDGE ARNOLD: If you take a look at the 15 case you cited where they decided 17 miles, they did 16 not do that based upon an examination of are the 17 threats in an ISFSI. They just said, well, Shearon 18 Harris used 17 miles so we'll use it too. That sounds 19 to me to be a very poor basis to decide that somebody 20 has standing. Now as I understand it, although you 21 never used the expression, proximity plus, in your 22 petition, that that's basically what you're basing 23 your standing on.
24 MS. CURRAN: Yes.
25 JUDGE ARNOLD: And as the staff mentioned NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
14 1 in their answer, petitioner must demonstrate that the 2 proposed action involves a significant source of 3 radioactivity producing an obvious potential for 4 offsite consequences. Now I personally don't see an 5 obvious potential. But you, I believe, do. Could you 6 tell me what that potential is and how it may occur?
7 MS. CURRAN: It would -- certainly in the 8 case that we brought, it was in -- I guess it would've 9 been the first ISFSI licensing proceeding, we 10 presented scenarios where a cask could be breached and 11 a radioactive release could occur, airborne 12 radioactive release with significant off-site 13 consequences. So we have -- that hasn't changed.
14 That's a potential attack on an ISFSI. We also know 15 that spent fuel is the most highly radioactive 16 substance, or one of them, on the planet. And this is 17 a significant quantity being stored in one place.
18 JUDGE ARNOLD: So I do not have those 19 scenarios in front of me. And they're not in your 20 petition. Can you recall what type of circumstances 21 would lead to a release of that nature?
22 MS. CURRAN: We presented scenarios of an 23 attack on a spent fuel storage facility. And we did 24 not get into exhaustive detail because it's a 25 sensitive security issue. But we demonstrated that it NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
15 1 was credible and that it could result in a significant 2 off-site release.
3 And our expert witness talked about what 4 the consequences could be, that they were far reaching 5 and significant. And I would be happy to brief the 6 standing issue again. We rely on the precedent and 7 the very same ISFSI licensing that was decided some 8 years ago. But if it's a concern of the licensing 9 board, we'd be happy to present all that evidence 10 again.
11 JUDGE ARNOLD: Would you contend that the 12 scenarios you presented then are still possible now, 13 that there's not been changes in technology or 14 anything that would make them less credible? Are the 15 scenarios of 20 years ago, are they still valid today?
16 MS. CURRAN: In my opinion as a lawyer, 17 these things are credible. You're talking about 18 standing where very little bit of harm is enough to 19 give you standing. I don't know -- I mean, these are 20 security issues, right? Has the ISFSI been redesigned 21 so that this is no longer a credible event? I'm never 22 going to be able to tell you that.
23 JUDGE HAWKENS: I will note that the 24 Commission recently -- as you mentioned, the storage 25 case, the Holtec case found proximity plus standing as NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
16 1 well. And although those weren't mentioned, do you 2 have any views on the applicability of your rationale 3 on those Commission decisions?
4 MS. CURRAN: They would be equally 5 applicable here, although the quantity is not as 6 great. But still, it's --
7 (Simultaneous speaking.)
8 JUDGE HAWKENS: Twenty-one hundred metric 9 tons though is a lot of radioactive waste.
10 MS. CURRAN: Yes.
11 JUDGE HAWKENS: Do you have any more on 12 standing?
13 JUDGE ARNOLD: No.
14 JUDGE HAWKENS: Do you have any more on 15 standing?
16 JUDGE TRIKOUROS: No.
17 JUDGE HAWKENS: You may proceed to the 18 contention of admissibility today.
19 MS. CURRAN: Okay. I'm just trying to 20 remember where I was.
21 JUDGE HAWKENS: You were on Contention A.
22 MS. CURRAN: Yeah.
23 JUDGE HAWKENS: Operation and 24 decommissioning.
25 MS. CURRAN: Oh, yeah. So there's two NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
17 1 reasons why this is not just an academic exercise.
2 First of all, this is an ANSI -- these are ANSI 3 regulations. They were promulgated for a reason, to 4 provide reasonable assurance that in fact highly 5 radioactive spent fuel can be cared for adequately for 6 a long period of time in which we're going to have it 7 at reactive sites.
8 Second, PG&E has repeatedly referred to 9 itself as a contractor of the state. PG&E is now 10 holding itself out in a different light, in a 11 different relationship to the State of California.
12 The State of California is responsible for providing 13 funding for financial assurance for safe operation of 14 the ISFSI until the time of decommissioning starts.
15 The state, the ratepayers of the state, 16 the taxpayers of the state deserve to know where is 17 the money coming from. Are we paying for it? Who's 18 paying for it?
19 So those are the, I think, important 20 reasons why this information is important to provide.
21 And as the staff said in responding to our contention, 22 the operation of the plant is related to the ISFSI.
23 The ISFSI doesn't -- you might have been able to say 24 that in March of 2022, there's only one purpose for 25 this ISFSI going forward, to store spent fuel. But as NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
18 1 long as operation is going on, there's a relationship 2 there that needs to be addressed.
3 JUDGE HAWKENS: PG&E argues that don't 4 worry about that because the assumption we're using 5 provides a more conservative financial scenario. And 6 so you and the public should be satisfied with that.
7 How would you respond?
8 MS. CURRAN: I don't think it necessarily 9 is more conservative. They have or this period which 10 may be between 5 and 20 years. They don't have access 11 to the decommissioning trust fund.
12 And the whole issue of financing of the 13 future operation of Diablo Canyon is kind of up in the 14 air right now. The last thing we had from Public 15 Utilities Commission was approval of shutdown. That 16 was in 2018.
17 Now the PUC is going through a proceeding 18 where they're evaluating the prudence of allowing 19 Diablo Canyon to continue operating. I honestly don't 20 know how spent fuel storage factors into that. But 21 there's going to be a whole series of PUC proceedings 22 that have to do with covering the costs of Diablo 23 Canyon.
24 So it's not -- there's many things that 25 are uncertain here. And frankly if it were up to me, NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
19 1 I wouldn't be standing here today arguing about this.
2 I wish that PG&E had simply amended its application or 3 asked the Board hold off until we know what we're 4 doing because it doesn't make any sense to rely on an 5 application that's so clearly out of date. And maybe 6 PG&E doesn't know what it's doing quite yet. But we 7 could all wait until that happens instead of kind of 8 arguing in a hypothetical sense what might happen in 9 the future.
10 JUDGE HAWKENS: What about their argument 11 that the application permissibly reflects the status 12 quo? And there's no regulation that you've cited that 13 requires them to include in the application something 14 that's purely speculative, uncertain. How would you 15 respond to that?
16 MS. CURRAN: Well, I think calling it the 17 status quo is a little extreme. This is a company 18 that has applied to the NRC for permission to seek 19 reactor license renewal. We know that the NRC has 20 told them they can get timing renewal protection and 21 if they file by the end of 2023.
22 So the status quo is kind of blurry in 23 terms of if you apply the -- if you go through the 24 process of throwing us out now, then when PG&E files 25 a new reactor license application, I honestly don't NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
20 1 see where we have an opportunity to litigate how that 2 affects the ISFSI because you will have approved the 3 license. So we're here. We're here because this was 4 the opportunity that came up. And we know that we get 5 60 days to ask for a hearing or else it's gone.
6 JUDGE ARNOLD: Six years ago, the 7 intentions of PG&E was to renew Diablo Canyon's 8 license and continue operating. A couple years ago, 9 the intention of PG&E was to shut down Diablo Canyon.
10 And now the intention of PG&E is to relicense Diablo 11 Canyon.
12 It looks like their intentions are a very 13 moving target, a very blurred issue I'm saying. I 14 wonder what legal requirement is there to make an 15 application that is being considered now reflect a 16 blurred future. I mean, yes, we would like it. But 17 is there a legal requirement?
18 MS. CURRAN: I think there is in the sense 19 that it's because what they say in the application 20 depends so much on whether there's an operation of the 21 reactor that's going on. And if you know that that's 22 in the plans, than to pretend that doesn't exist, it's 23 not an accurate reflection of PG&E's intentions. And 24 therefore, we think that they need to at least address 25 it.
NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
21 1 They could address it in the alternative.
2 They could say, well, if we -- maybe they'll have to 3 shut down the plant. Maybe they won't. Maybe the PUC 4 will say we're not giving you this five years that the 5 legislature wants us to give you.
6 They could address that in the 7 alternative. They could say if we shut down, this is 8 what we'll do. If we keep operating, this is what 9 we'll do.
10 And then we would have the satisfaction, 11 we would have the assurance that PG&E knows where it's 12 going to get the money and what it's going to cost 13 depending on the timing of decommissioning. Okay.
14 I'd like to -- unless you have more questions about 15 the safety contention, I'd like to move on to the 16 environmental contention. Can you tell me how much 17 time I have left, please?
18 MS. JOHNSON: Ten minutes.
19 MS. CURRAN: Ten minutes? Okay. The 20 environmental contention states that PG&E's 21 environmental report is inadequate to satisfy the 22 National Environmental Policy Act because the 23 statement of purpose and need relate only to the 24 storage of spent fuel that will be generated before 25 the expiration dates of 2024 and 2025 in the current NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
22 1 license until the repository becomes available. And 2 I can't remember, one of you just pointed out that 3 this environmental report is called a supplemental 4 environmental report. This is a supplement to the 5 original environmental report that was prepared in 6 2001.
7 And if you go back to that environmental 8 report, it talks about the relationship between the 9 operation of the plant and the ISFSI. At the time 10 PG&E thought or they knew that they could only operate 11 until 2006 and they were going to have to close down 12 if they didn't have additional spent fuel storage 13 capacity. So they evaluated a range of alternatives.
14 They came up with dry storage. They said 15 the dry storage facility is going to hold all the fuel 16 that we generate until 2024 and 2025. And they said 17 they picked dry storage over pool storage, quote, 18 based on an overall assessment of operational and 19 safety considerations, the amount of spent fuel to be 20 generated, the transportation requirements associated 21 with the alternatives, resources needed, and 22 scheduling restraints.
23 So PG&E looked at the whole picture of 24 operation and spent fuel storage and chose the ISFSI.
25 They chose to build an ISFSI and seek a license. They NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
23 1 chose to build it big enough to hold all of the spent 2 fuel that they would have.
3 And they said that in the environmental 4 report. And then they said that in the updated final 5 safety analysis report. We also know and this on page 6 -- I think it's page 11, note 15 of our hearing 7 request that the State of California has a policy 8 favoring moving fuel from the pools to the dry storage 9 facility. This is setting aside whatever the NRC --
10 you know the NRC's continuing storage rule says --
11 JUDGE HAWKENS: Can you explain why 12 California statutes and policy are within the scope of 13 this proceeding?
14 MS. CURRAN: Two reasons. One is that 15 PG&E calls itself a contractor to the state and should 16 be talking about the policy issues associated with 17 spent fuel storage that are important to the state.
18 And second, NEPA generally --
19 JUDGE HAWKENS: I apologize for 20 interrupting. But what regulation are you basing that 21 on that requires them to address state statues and 22 policy?
23 MS. CURRAN: It's simply because in effect 24 PG&E is saying that they're standing in the shoes of 25 the state and making these environmental decisions.
NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
24 1 I don't have a regulation for that. This is a very 2 unusual situation. I've never seen anything like it 3 before.
4 And NEPA is a statute that requires 5 reasonable decisionmaking. You look at the 6 circumstances and decide what are reasonable array of 7 alternatives to be looked at. What's a reasonable 8 impact analysis?
9 And I would submit that if the State of 10 California thinks that moving spent fuel into the 11 ISFSI is an important policy consideration and if PG&E 12 is a contractor to the state, that ought to be 13 discussed. And also -- yeah, I think that's -- I 14 think that's all I'll say. So in our view, the 15 statement of purpose and need now that we know PG&E is 16 planning to continue to operate the reactors for 5 to 17 20 years, should circle back to the initial 18 environmental report and talk about the purpose and 19 need back then, how has it been satisfied, how has it 20 changed, and what are the current considerations that 21 are important to our contractor, the State of 22 California?
23 JUDGE HAWKENS: They argue that they have 24 60 years of storage combined with dry storage and wet 25 storage. That's sufficient for the 20 years of NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
25 1 additional operating time for the reactors. And in 2 light of that, their purpose and needs statement is 3 adequate and what they consider is adequate. What's 4 wrong with that argument?
5 MS. CURRAN: You know, Judge Hawkens, I 6 think that one of the really important things about an 7 environmental assessment is that it informs the 8 affected members of the public. Right now, if you 9 were somebody who picked up the environmental 10 assessment and you're just reading it and you know 11 that PG&E is planning to operate these reactors for 12 some extended period of time, reading it because it's 13 been approved for a hearing process knowing what 14 PG&E's current plans are, you could easily think that 15 PG&E is representing that they are going to safely 16 store all of the quantity of spent fuel to be 17 generated by the Diablo Canyon reactors in this ISFSI 18 which, of course, is I think it's pretty universally 19 agreed that dry storage is safer than pool storage 20 because you don't have the potential for draining the 21 pools which is a matter of concern to the State of 22 California and others because of the potential for 23 earthquakes in that area.
24 So if you're a member of the public and 25 you're reading this document, you don't have a clear NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
26 1 understanding of what exactly is going on. You don't 2 have a clear understanding of the fact that if PG&E 3 operates even five more years, it may not have enough 4 room in the ISFSI for all the spent fuel that will be 5 generated. And thus for however many years until we 6 have a repository, fuel could be remaining in the 7 pool. Some amount of fuel could be remaining in the 8 pool. The public is entitled to disclosure of all 9 this so that state lawmakers, policymakers, members of 10 the public can debate, is this what we want?
11 And these are -- the purpose of an 12 environmental assessment is to educate people who 13 might be applying this under state law. They take the 14 facts that are presented in a federally approved 15 document and say, well, these are the facts that we 16 have to work with. It's really important that these 17 documents should be up to date and clear because 18 they're used for many purposes. And I think I will 19 close right there.
20 JUDGE HAWKENS: All right. You have two 21 minutes remaining. That'll be added to your rebuttal 22 time.
23 MS. CURRAN: Thank you.
24 JUDGE HAWKENS: Mr. Lighty, you may 25 proceed, sir. I'd ask as well sometime if you could NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
27 1 incorporate into your argument, although you did not 2 oppose standing, just inform us why you did not oppose 3 standing.
4 MR. LIGHTY: Yes, thank you, Your Honor.
5 And may it please the Board, Ryan Lighty on behalf of 6 PG&E. We know Your Honors have studied the briefs.
7 And we don't intend to use our presentation to simply 8 repeat those briefings.
9 But we would like to use a portion of our 10 time to discuss a few key issues that are particularly 11 important here and to respond to some assertions that 12 were in the staff's answer and the petitioner's reply.
13 And we'd like to start with two overarching topics 14 that inform the discussion today and then move into 15 the discussion of the individual contentions in turn 16 and then respond to some of petitioner's arguments 17 that have been presented today. And I expect our 18 prepared remarks will take less than half of our time, 19 so plenty of time for Board questions.
20 And I'll start off addressing the standing 21 issue as you requested, Your Honor. We did not 22 analyze that issue in depth because in our view, the 23 standing analysis is immaterial given that neither of 24 the contentions is admissible. The petition must be 25 denied for that reason alone.
NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
28 1 So we didn't conduct an analysis of 2 standing. But to go to Judge Arnold's point about the 3 Bell Bend proceeding, we certainly agree that a fresh 4 standing demonstration must be made in every 5 proceeding. You cannot rely on the factual predicate 6 from a prior ruling. And that must be demonstrated 7 fresh in each proceeding.
8 To the extent that petitioners rely only 9 on their finding of standing in the initial ISFSI 10 licensing proceeding, I would note that that's a 11 different type of proceeding. An initial licensing 12 proceeding is different than a license renewal 13 proceeding. And so to the extent that the standards 14 are different, that case law may or may not apply 15 squarely here. So, turning back to the two 16 overarching topics.
17 JUDGE HAWKENS: To be clear, you do not 18 oppose standing?
19 MR. LIGHTY: Correct, Your Honor.
20 JUDGE ARNOLD: And one other thing, in not 21 opposing standing, are you agreeing that your ISFSI 22 poses an obvious potential for off-site consequences?
23 MR. LIGHTY: We do not necessarily agree 24 with that assertion.
25 JUDGE HAWKENS: Although you haven't NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
29 1 opposed it because you haven't opposed standing?
2 MR. LIGHTY: Correct, correct. To the 3 extent that off-site consequences must be 4 demonstrated, they have to be demonstrated at a 5 particular radius, specific to the type of licensing 6 action that is presented. And so to the extent that 7 the representations and the standing declarations 8 don't mean that radius, then obviously it would be 9 petitioner's burden to make the demonstration that it 10 does apply here.
11 So turning back to the overarching topics, 12 the overarching themes presented here today, first, we 13 want it to be crystal clear that the LRA was complete 14 and accurate when it was submitted. And still to 15 date, it accurately reflects the legal status quo.
16 Based on the current legal posture, the reactor 17 operating licenses are set to expire at the end of 18 their initial four year terms.
19 And absent intervening circumstances that 20 would materially change the facts of the ground, 21 that's what will happen. No one disputes that PG&E is 22 planning to seek renewal of its licenses, but it 23 hasn't done so yet. No application has been filed.
24 No application has been docketed.
25 And that speculative application certainly NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
30 1 has not been approved yet and is noted in our brief at 2 Footnote 46. The California Public Utilities 3 Commission or CPUC also has not yet authorized that 4 continued operation. So there are several gates that 5 must be passed through before continued operation 6 could become the legal reality.
7 In fact, the petitioner's currently 8 participating in at least three different proceedings, 9 in state court, in federal court, before CPUC seeking 10 to prevent continued operation. So for the petitioner 11 to argue here that the ISFSI license renewal 12 application was required to assume continued operation 13 is a bit disingenuous. At bottom, the LRA currently 14 reflects the most up-to-date legal information 15 regarding the status of the DCPP reactor license.
16 JUDGE HAWKENS: At what point would PG&E 17 be required to amend the application?
18 MR. LIGHTY: Well, I think that's a good 19 question and an issue that petitioner should've 20 addressed in their petition. They haven't identified 21 any regulation in Part 72 that requires the LRA, which 22 was complete and accurate at the time it was filed, to 23 be updated to reflect an inchoate scenario involving 24 potential future licensing applications in a different 25 proceeding. And our view is that there is no such NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
31 1 regulation in Part 72 that requires that update to be 2 made under these circumstances.
3 JUDGE HAWKENS: And can you answer the 4 question then when are you required to amend it, the 5 license renewal application?
6 MR. LIGHTY: I think in our view when the 7 reactor -- if the reactor licenses are, in fact, 8 renewed, that would be a substantially changed 9 circumstance that should be reflected in the 10 application.
11 JUDGE HAWKENS: But not when the licensed 12 reactor renewal application is filed?
13 MR. LIGHTY: Well, I think that there 14 could be an colorable argument made for a petition for 15 rulemaking to establish a rule that requires that.
16 But the current regulations do not contain that 17 requirement. And petitioner certainly hadn't 18 demonstrated that much.
19 So at the end of the day, the application 20 was complete and accurate when filed, reflects the 21 current legal reality and nothing more is required.
22 The second overarching matter, we want to reiterate 23 the speculative nature of petitioner's ISFSI expansion 24 claims. The petitioner suggests that if the reactor 25 operating licenses are renewed and if the units NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
32 1 continue to operate, than PG&E will be required to 2 expand this specific licensed ISFSI to accommodate 60 3 years' worth of spent fuel.
4 That's factually and legally incorrect.
5 To be clear, PG&E is not seeking to expand this ISFSI 6 at this time. That's a fact that petitioner does not 7 dispute.
8 The existing storage pads of the ISFSI are 9 sufficient to store all spent fuel generated during 10 the initial 40-year term. The spent fuel pools are 11 capable of holding another 20 years of spent fuel. So 12 PG&E currently has the ability to store 60 years' 13 worth of spent fuel at the site without expanding any 14 facilities. That's another fact petitioner does not 15 dispute.
16 JUDGE TRIKOUROS: Mr. Lighty, let me 17 interrupt you. Does that 60-plus -- the 40 plus 20 18 components, do they include the ability to offload a 19 full core at the end of that 60-year period?
20 MR. LIGHTY: I believe so, Your Honor. I 21 believe it does contemplate the entire inventory of 40 22 years of operation including final core.
23 JUDGE TRIKOUROS: Okay.
24 MR. LIGHTY: But even assuming for the 25 sake of argument that additional dry storage is NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
33 1 required at some point in the future, for example, 2 after a permanent shutdown of the reactors to support 3 their decommissioning, PG&E could elect to develop 4 that capacity.
5 But regardless of whether that would occur 6 via a general license for a new ISFSI, a new specific 7 licensed ISFSI, or an amendment to this specific 8 licensed ISFSI, any expansion would be subject to a 9 separate regulatory process. So the bottom line is 10 that the current license capacity of this ISFSI does 11 not hinge on whether the reactors operate beyond 40 12 years.
13 And to the extent that petitioners allege 14 otherwise, its claims are factually incorrect based on 15 the plain text of the terms of the ISFSI license that 16 is proposed to be renewed here. So turning now to the 17 two contentions. In Contention A, petitioner presents 18 three challenges to the safety portion of the 19 application. The first relates to financial 20 qualifications, the second to decommissioning funding 21 assurance, and the third relates to the General Design 22 Criteria or GDC.
23 As we understand petitioner's reply at 24 pages 3 and 4, it has dropped its GDC claim. So our 25 discussion will focus only on the first two arguments, NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
34 1 both of which are financial in nature. And here, we 2 ask the Board to take particular note, and this is 3 important.
4 Both of these financial arguments rest on 5 the same assertion that the material deficiency in the 6 application is that it does not consider the financial 7 and decommissioning implications of storing 60 years' 8 worth of spent fuel on the ISFSI. For example, page 9 6 of the petition criticizes the decommissioning 10 finding discussion because it does not address, quote, 11 the cost of decommissioning the ISFSI, end quote, if 12 it stores 60 years' worth of spent fuel. Likewise, 13 page 7 of the petition alleges the application does 14 not, quote, account for increased operating costs, end 15 quote, of storing 60 years of spent fuel.
16 But as I mentioned earlier, this license, 17 the only one at issue in this proceeding, does not in 18 any way authorize storage of 60 years of spent fuel.
19 Simply put, there's no legal or regulatory obligation 20 to analyze that unlicensed scenario in the safety 21 application. So setting aside those ISFSI expansion-22 related claims, the only arguments left in the 23 petition are petitioner's bare complaint that the 24 application on its face just doesn't mention the 25 possibility of plant license renewal.
NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
35 1 But the petitioner doesn't identify any 2 reason that circumstance in and of itself constitutes 3 a material defect in the application. Materiality 4 matters, Your Honors. In fact, it's probably the most 5 important consideration in adjudicating Contention A.
6 It is the fundamental premise of Section 2.309F1 XIII 7 6 which places an affirmative burden on the 8 petitioners to, quote, show that a genuine dispute 9 exists with the applicant slash licensee on a material 10 issue of law or fact.
11 JUDGE HAWKENS: Mr. Lighty, a question for 12 you. You have a very strong, hyper-technical 13 argument. But I think the regulations, when they 14 require you to provide the NRC with complete and 15 accurate information in the license renewal 16 application, for you to ignore the sea change in 17 circumstances since when you first submitted this 18 application. Now you're directed to seek renewal.
19 And it's not -- I don't think in your pleading you 20 ever said that PG&E intends to seek renewal of the 21 reactors, does it?
22 MR. LIGHTY: Yes, at this time --
23 JUDGE HAWKENS: Okay.
24 MR. LIGHTY: -- PG&E does intend to seek 25 renewal. Again, there are several hurdles, several NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
36 1 gates, several rules.
2 JUDGE HAWKENS: Including whether it will 3 be approved or not. But in your license renewal 4 application which was entirely correct at the time, 5 you indicated you were going to shut down in 2024, 6 2025 and made representations regarding operational --
7 financial operational ability and decommissioning 8 financial ability based on that assumption. And that 9 assumption hyper-technically is still correct.
10 But as a practical matter, it's not. And 11 that raises a genuine dispute about financial ability 12 for operation and decommissioning. Not as a practical 13 matter because as the NRC staff observes, it appears 14 based on California statute which provides you with 15 the necessary rate income you need for operation and 16 decommissioning.
17 That shouldn't be a problem. But the NRC 18 staff and the public is entitled to accurate and 19 complete representations, I think, it is my sense in 20 your license renewal application. And there seems to 21 be a genuine question as to whether those 22 representations are complete and accurate. And there 23 wasn't a discrete question in there, but could you 24 respond to that?
25 MR. LIGHTY: Certainly. I have a couple NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
37 1 of thoughts on that. The first is we're here to 2 discuss the compliance status of the LRA. It was 3 complete and accurate at the time it was filed.
4 There's no dispute about that. The question is 5 whether there is a duty of the applicant to then 6 update the application based on --
7 JUDGE HAWKENS: Materially changed 8 circumstances.
9 MR. LIGHTY: Yeah, what Petitioners are 10 arguing are materially changed circumstances. And I 11 think that when you compare this, for example, to a 12 Part 54 license renewal proceeding for a reactor, 13 there is a regulation that requires an annual update 14 to the application to contain certain information.
15 That does not exist in Part 72.
16 The standard that is in Part 72 is simply 17 the completeness and accuracy requirement. That 18 requires documents submitted to the NRC -- and I 19 believe the regulation is 10 CFR 72.11 -- to be 20 complete and accurate in all material respects.
21 But Subpart B of that regulation discusses 22 the duty to update information based on the discovery 23 of a significant safety issue. What we haven't seen 24 is Petitioners acknowledge or address that standard, 25 or explain or offer any theory as to why it's NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
38 1 satisfied here based on its claims in the petition.
2 As we've discussed, these ISFSI expansion claims are 3 factually and legally incorrect.
4 And all you're left with is a statement 5 that, on the face of the application, doesn't 6 acknowledge the possibility of reactor license 7 renewal. But there's no further discussion why that 8 matters outside of these expansion-related claims that 9 Petitioners were raising.
10 The Commission has long used the word 11 'flyspecking' to describe minor and insignificant nits 12 regarding environmental review that do not warrant 13 hearing because they have no material impact on the 14 proceeding. And, in general, flyspecking is just 15 another way of describing the absence of materiality.
16 Materiality applies to both environmental and safety 17 contentions.
18 JUDGE HAWKENS: On the safety contention, 19 though, in your application, you say, starting 20 November 24, the source of funds to operate and 21 decommission the ISFSI will include the 22 decommissioning trust fund. Accurate once submitted, 23 accurate now. But when the license renewal 24 application for the reactors is submitted and 25 approved, it will no longer be accurate, correct?
NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
39 1 MR. LIGHTY: Correct. Whether it's 2 material is a separate question. And at what point it 3 becomes material I think is another unresolved 4 question. In our view, it is not material at this 5 time. The compliance status of the application is 6 that it was complete and accurate when filed. And the 7 duty to update in 72.11(b) has not been triggered.
8 Because, at the end of the day, stripping 9 away the Petitioners' ISFSI expansion claims, there's 10 nothing in the petition, or that we've heard in 11 arguments today, that would, quote, change the outcome 12 of the proceeding.
13 That's the fundamental requirement for 14 materiality. In fact, all of the participants seem to 15 agree that there are no material concerns about PG&E's 16 financial qualifications to operate the existing 17 ISFSI. Staff's answer at Footnote 61 disavows any, 18 quote, substantive concerns, end quote.
19 And Petitioner doesn't allege any material 20 concerns that are unrelated to ISFSI expansion, which 21 isn't proposed here and isn't part of this licensing 22 action.
23 Now, we note that Staff takes the position 24 that proposed Contention A is admissible because, as 25 noted in its brief at page 11, quote, operations at NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
40 1 the DCMPP are connected to operations at the Diablo 2 Canyon ISFSI by the application. And the application 3 does not appear to address a potential change in the 4 planned retirement date of the DCNPP, end quote.
5 But that's not the end of the inquiry. As 6 the Staff notes a few pages later, in the last 7 sentence of the partial paragraph at the top of page 8 14, Staff says, quote, SLOMFP has not demonstrated how 9 such potential operations render the application 10 insufficient, end quote. We agree. We completely 11 agree. That is absolutely correct. Petitioner has 12 not alleged, much less demonstrated, any material 13 deficiency in the application that is unrelated to 14 ISFSI expansion. And that's what renders proposed 15 Contention A inadmissible, because materiality 16 matters.
17 Taking a step back for a moment. One 18 overarching purpose of the contention of admissibility 19 of criteria is to limit evidentiary hearings to 20 matters where inquiry in depth is appropriate. But 21 that's not the case here.
22 It is not necessary to convene a formal 23 hearing at significant taxpayer expense, at 24 significant ratepayer expense, to determine whether 25 PG&E is financially qualified to continue operating NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
41 1 the ISFSI. We already know the answer to that 2 question. As a matter of law, PG&E is presumed 3 qualified.
4 In fact, that's exactly what the 5 Commission said, in 2003, during the initial licensing 6 of the ISFSI, at CLI-03-12, which is cited in our 7 brief. The Petitioners here do not even allege the 8 existence of any information that would rebut that 9 presumption of law. So, to put it in plain terms, a 10 hearing under these circumstances would be a textbook 11 example of the type of wasteful and unnecessary 12 hearing that the admissibility rules were purposefully 13 designed to avoid.
14 Think of it this way. Even if the 15 application contained a token acknowledgment of a 16 possibility of reactor license renewal, it wouldn't 17 make one bit of difference in the outcome of this 18 proceeding because PG&E is financially qualified to 19 continue operating the ISFSI regardless of whether the 20 reactor licenses are renewed. And no participant in 21 this proceeding has claimed otherwise.
22 So, onto the separate issue of 23 decommissioning funding. Petitioner also fails to 24 identify a material defect in the LRA. As I noted 25 earlier, the Petitioners' principle criticism here is NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
42 1 that the application doesn't evaluate the cost of 2 decommissioning an ISFSI with 60 years of spent fuel.
3 But this license doesn't authorize 60 years of spent 4 fuel to be stored there, so that's not a defect in the 5 application at all, much less a material one.
6 As to decommissioning the as-licensed 7 facility, with 40 years of spent fuel, the 8 decommissioning funding projections in the application 9 are conservative. And Petitioner makes no 10 demonstration that anything further is required.
11 Now, what I mean by conservative is that 12 the LRA assumes that PG&E will begin drawing down on 13 the decommissioning trust fund in 2024 to cover ISFSI 14 operating costs. Then, as a result, the fund balance 15 would begin decreasing. The money starts going down.
16 In contrast, under a scenario where the 17 reactors continue to operate, that fund, instead of 18 decreasing in value, would continue to grow. NRC 19 regulations at 10 CFR Section 50.75 Echo romanette (i) 20 permit a licensee to assume a two percent annual real 21 rate of return on decommissioning funds. So, in 22 simple terms, deferred withdrawals equal additional 23 growth. That's just a common-sense observation. It 24 certainly doesn't require an evidentiary hearing, and 25 particularly where Petitioner has not identified a NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
43 1 material reason why anything beyond that conservative 2 analysis in the application is required, or even 3 meaningful in this proceeding.
4 At the end of the day, Petitioner's ISFSI 5 expansion-related claims are factually and legally 6 baseless. And Petitioner otherwise hasn't identified 7 any reason that the financial projections in the 8 application, as currently written to accurately 9 reflect the legal status quo, are materially deficient 10 in any way. Again, materiality matters here, Your 11 Honors.
12 Shifting gears to proposed Contention B, 13 Petitioner attacks the purpose and needs statement in 14 the ER supplement because it does not mention possible 15 renewal of the reactor operating licenses. But that 16 line of argument also misses the mark. The purpose 17 and needs statement in the ER supplement does not 18 mention a need to store 60 years' worth of spent fuel 19 because that is not, in fact, the purpose of this 20 action.
21 Petitioner identifies no unmet legal 22 requirement for the purpose and needs statement to 23 contemplate anything more. Quite simply, Petitioner 24 has not identified any deficiency in the purpose and 25 needs statement in the LRA, and the contention should NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
44 1 be rejected for that reason alone.
2 Now, you know, we understand that there 3 are a couple of other corollary arguments in 4 Contention B that I'd like to briefly mention 5 regarding alternatives and cumulative impacts. As 6 noted in our brief, Contention B alleges a defect in 7 the purpose and needs statement, and then claims that 8 some aspect of the alternatives or cumulative impacts 9 discussion supplies a supporting basis for that 10 contention.
11 But, as both PG&E and the NRC Staff have 12 explained in our respective briefs, there is no defect 13 in the purpose and needs statement. And so, without 14 that defect in the first instance, those assertions 15 about alternatives and cumulative impacts provide no 16 support for the overarching claim.
17 But, going one step further, just for the 18 sake of argument, even if we considered those 19 assertions as separate standalone claims or 20 contentions, they would still be inadmissible for 21 multiple reasons.
22 For example, Petitioner offers conclusory 23 assertions that the alternatives and cumulative 24 impacts discussions are deficient, but it doesn't 25 identify a single reasonable alternative that hasn't NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
45 1 been considered, or a single cumulative impact that 2 hasn't been considered.
3 As another example, given that this is a 4 Part 72 license renewal proceeding, the ER supplement 5 is only required to address, quote, significant 6 environmental changes, end quote, pursuant to 10 CFR 7 Part 72. So, Petitioner doesn't acknowledge that 8 standard, and it certainly doesn't offer any 9 explanation as to how it's met or satisfied it here.
10 11 So, in sum, these arguments do not support 12 a challenge to the purpose and needs statement. And 13 even if viewed as standalone contentions, these 14 corollary claims would be inadmissible in their own 15 light. And, for these and many other reasons stated 16 in our brief, we believe that neither Contention A nor 17 Contention B are admissible and that the Board should 18 dismiss the petition accordingly.
19 I did want to address just a couple of 20 comments that we heard from Petitioner's counsel a few 21 minutes ago. In the discussion that we heard, there 22 was a suggestion that the application, at Appendix G-23 4, discussed the decommissioning timeline being based 24 on a prompt ISFSI decommissioning scenario.
25 And that is correct. But what the Board NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
46 1 should understand here is that the decommissioning 2 timeline for the ISFSI is not affected by plant 3 operation. The ISFSI will store the fuel from the 4 initial 40 years of operation and no more, absent some 5 other future licensing action, but the timing for the 6 removal of that fuel doesn't depend on whether the 7 reactor continues to operate. That depends on DOE's 8 performance, or the availability of a consolidated 9 interim storage facility, or some other outside action 10 that is not affected by plant license renewal. So the 11 decommissioning timeline for the ISFSI isn't affected 12 by the plant license renewal.
13 I also wanted to respond to counsel's 14 claim that Petitioners didn't know how the ISFSI 15 operating costs would be funded if the plant licenses 16 are renewed. As noted in our brief, at Page 14, 17 Footnote 53, the SB 846 statute passed by the 18 California legislature and signed by the California 19 governor says that those operating costs will be 20 recovered through the normal rate-making process.
21 And, finally, I'd like to respond to 22 counsel's assertion that PG&E is a contractor to the 23 state. PG&E has not held itself out as acting on 24 behalf of the State of California in this ISFSI 25 license renewal proceeding, period. So I just wanted NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
47 1 to clarify that for the Board.
2 And I'm happy to take any other questions 3 Your Honors may have.
4 JUDGE TRIKOUROS: I just want to 5 understand the picture at the end of 60 years. We're 6 looking at an ISFSI that has 40 years of fuel in it, 7 full. We're looking at a spent fuel pool that has 20 8 years of fuel in it, apparently with enough empty 9 space to also include a full core offload. Otherwise, 10 I suppose you would not be able to make it to that 11 point prior. You'd have to stop in prior years or do 12 something at the end of that, when you ran out of that 13 ability to offload.
14 The decommissioning activities, as I see 15 them, would not be able to begin at that point because 16 the -- well, I'll phrase it as a question. Could you 17 begin decommissioning activities with the fuel in that 18 state that I just mentioned, 20 years in the spent 19 fuel pool and 40 years in the ISFSI?
20 MR. LIGHTY: Are you talking about, could 21 decommissioning begin on the plant or --
22 JUDGE TRIKOUROS: On the plant. I'm 23 talking about on the plant.
24 (Simultaneous speaking.)
25 MR. LIGHTY: I think that partial NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
48 1 decommissioning activities could begin. Obviously, 2 the plant itself could not be fully decommissioned 3 with spent fuel still in the pool.
4 JUDGE TRIKOUROS: Okay. So there would be 5 a requirement to expand the storage requirements for 6 spent fuel at that point, but it would not necessarily 7 involve this particular ISFSI. Is that correct?
8 MR. LIGHTY: Correct. If a policy 9 decision or a mandate of a state said you must fully 10 decommission the reactor, take the fuel out of the 11 spent fuel pool, and assuming that there was no 12 consolidated interim storage facility available, that 13 DOE has not completed a permanent repository at the 14 end of the 40-year license renewal period of the 15 ISFSI, then potentially there would be a need to have 16 other dry storage onsite.
17 But as you mentioned, Judge Trikouros, it 18 could either be through a general license, a separate 19 specific license, an amendment to this specific 20 license. But none of that is being proposed as part 21 of this license renewal.
22 JUDGE TRIKOUROS: And it doesn't have to 23 be dry storage, actually, I suppose. It could be any 24 number of other options.
25 MR. LIGHTY: True. We have seen other NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
49 1 precedent where fuel goes from one site to another 2 site, even though that site is not necessarily a 3 consolidated interim storage facility but potentially 4 an aggregator site.
5 JUDGE TRIKOUROS: All right. Thank you.
6 JUDGE HAWKENS: Thank you.
7 MR. LIGHTY: Thank you, Your Honors.
8 (Pause.)
9 JUDGE HAWKENS: You may proceed, sir.
10 Thank you.
11 MR. GENDELMAN: Thank you. Good 12 afternoon. May it please the Board. My name is Adam 13 Gendelman from the NRC Staff. Thank you for the 14 opportunity to discuss the Staff's position on San 15 Luis Obispo Mothers for Peace's petition. I plan to 16 discuss Staff's views on the principle issues in 17 dispute -- especially Contention A, as each party has 18 a different view -- address the important points for 19 you today, and I'd be happy to answer the Board's 20 questions.
21 JUDGE HAWKENS: Could you also start off 22 with a brief discussion on your view of standing?
23 MR. GENDELMAN: Happily, Your Honor. I 24 think you and Judge Arnold captured the Staff's 25 position exactly with regard to the discussion of the NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
50 1 proximity-plus standard.
2 In the Staff's view, as you noted, Judge 3 Hawkens, this is an application for the renewal of a 4 facility to store 2,100 metric tons of spent fuel. And 5 in the Staff's view, that action meets that standard.
6 To be clear, that's not a reflection on the actual 7 probability of any event that could cause such 8 consequences. But, especially given that this is a 9 license renewal proceeding versus, for example, an 10 amendment on some more auxiliary matter, we think 11 standing has been demonstrated in that regard.
12 JUDGE HAWKENS: And based on the legal 13 rationale and the Licensing Board's 2002 standing 14 decision in the Diablo Canyon case, you still find 15 that to be a reasonable analysis?
16 MR. GENDELMAN: It's informative. With 17 regard to the previous discussion about a fresh 18 assertion of standing, I think we agree with 19 Petitioner that they have made that fresh assertion 20 here. I think it's appropriate to note past similar 21 circumstances and how they were disposed of. But the 22 petition doesn't say, oh, well, we were granted 23 standing in the past, so we have standing now. It 24 makes that fresh assertion, as pointed out both in the 25 petition and in the updates.
NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
51 1 JUDGE ARNOLD: Where in the petition does 2 it even assert that there's a potential for offsite 3 consequences?
4 MR. GENDELMAN: So, in our reading of the 5 affidavits, the affiants note they're concerns about 6 continued operation of the ISFSI jeopardizing their 7 health and safety and the quality of the environment.
8 And so that's the language that we think it 9 demonstrates those concerns.
10 JUDGE ARNOLD: That demonstrates that they 11 have a concern, but does it demonstrate that there's 12 an obvious potential for damage?
13 MR. GENDELMAN: No, I think, as I said, 14 the Staff's view is we're not contesting standing, in 15 the light of the fact that this is a major license 16 proceeding, a proceeding whose disposition affects 17 whether or not this facility will continue to operate, 18 coupled with the amount of radioactive material to be 19 stored, and the potential, however small, of what 20 dispersion of that material could bring about.
21 JUDGE ARNOLD: So, essentially, you're 22 filling in the assertion that there's an obvious 23 potential for consequences based upon your knowledge 24 of what this facility is, what's stored there?
25 MR. GENDELMAN: I'm not sure I would NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
52 1 characterize it that way, but Staff's view is that 2 standing has been adequately pled. I understand the 3 Board's questions with regard to some of those square 4 corners. But I think that, consistent with both 5 previous practice, it's inferential, not binding 6 authority, that standing has been demonstrated.
7 JUDGE TRIKOUROS: Just one question along 8 those lines. Does the fact that this plant is in the 9 Ninth Circuit and that terrorist activities are soon 10 to occur in that circuit, would you say that the 11 licensing basis of this plant, Diablo Canyon, includes 12 the potential for terrorist activity associated with 13 the spent fuel pool, the ISFSI?
14 MR. GENDELMAN: So, I believe I understand 15 your question. And I would certainly say that ISFSIs 16 in the Ninth Circuit, and all others, are 17 appropriately required to mitigate against both safety 18 and security risk, consistent with NRC requirements.
19 With regard to standing, I don't think it is 20 aggravated or mitigated in any particular circuit.
21 But, as I said, the Staff's read of the proximity-plus 22 standard is about a potential for consequences, 23 distinct from an actual probability.
24 So, I'll unpack that for a second. For 25 example, if this was a proposal to add a single cask NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
53 1 -- for example, to go from 2,100 tons to 2,150 metric 2 tons -- I think the analysis might be different 3 because at issue is the condition of a single cask 4 versus the renewal of the entire facility.
5 JUDGE TRIKOUROS: Thank you.
6 MR. GENDELMAN: So, to begin, this 7 proceeding, of course, concerns PG&E's application to 8 renew its ISFSI license under Part 72. It's not a 9 proceeding for the renewal of -- a reactor license 10 renewal, nor is it a proceeding, as the Applicant 11 noted several times, to otherwise amend PG&E's Part 72 12 license to resign the facility or change the amount of 13 material that can be stored there.
14 In one case identified in the petition, 15 the ISFSI renewal application creates a linkage 16 between the retirement of the Diablo Canyon reactors 17 and satisfaction of financial qualification 18 requirements in 10 CFR 72.22(e).
19 In that one case, the developments 20 associated with potential reactor renewal are 21 relevant, and, indeed, in the staff's view, the basis 22 for an admissible contention, but relevant only 23 because they bear factually on the satisfaction of 24 regulatory criteria in this proceeding. This 25 framework unknots the central question, we think, NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
54 1 presented by both contentions, which is: with respect 2 to this Part 72 proceeding, what is the significance, 3 if any, of the recently developments associated with 4 the potential for continued operations at the Diablo 5 Canyon reactors?
6 We think the answer indicated is that 7 they're relevant only insofar as they bear upon the 8 ISFSI license renewal application and the Applicant's 9 satisfaction of requirements, again, in this 10 proceeding.
11 This framework also shows why the 12 petition's other arguments in Contention A and 13 Contention B do not succeed, because the other cited 14 portions of the ISFSI renewal application do not rely 15 on the timing of the retirement of the Diablo Canyon 16 reactors as the basis for meeting regulatory 17 requirements in Part 72. And, therefore, these recent 18 events concerning that potential for continued 19 operations are not similarly relevant to this 20 application.
21 And so, with respect to Contention A, as 22 noted in its answer, the Staff views the portion of 23 Contention A concerning financial qualification in 24 72.22(e) to be admissible.
25 JUDGE HAWKENS: And that's all that's NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
55 1 before us now, since Petitioner's filed a reply.
2 Isn't that correct? And let me ask it another way.
3 I understand, based on Petitioner's reply, I think I 4 would understand that you agree now that their 5 contention should be admissible in full? And if not, 6 could you tell me why not?
7 MR. GENDELMAN: I'm not sure that I 8 understood the reply to drop the 72.30 financial 9 assurance argument, as distinct from 72.22 financial 10 qualifications argument. But otherwise, yes.
11 JUDGE HAWKENS: All right. We'll follow 12 up with that in rebuttal. Please proceed.
13 MR. GENDELMAN: So, in sum, 72.22(e) 14 requires an applicant to demonstrate its financial 15 qualifications, and that they either have the 16 necessary funds or have reasonable assurance of 17 obtaining them to cover operating costs for the 18 planned life of the facility -- in this case, a 40-19 year renewal for the ISFSI, not to be confused with 20 the other renewal -- as well as the cost of 21 decommissioning the ISFSI facility.
22 The application provides that this funding 23 will derive from the rate-making process until 24 November 2024, at which time funding will include the 25 reactor decommissioning trust fund. The petition NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
56 1 contrasts these representations with the recent 2 developments concerning the potential for continued 3 operations of the Diablo Canyon reactors: the passage 4 of California law S.B. 846, the exemption request from 5 the applicant, the Gerfen letter where the Applicant 6 states its intent, as we heard today, to take the 7 necessary regulatory steps to operate Diablo Canyon 8 reactors beyond the dates in their current license.
9 The petition concludes that, therefore, the Applicant 10 has not demonstrated financial qualifications, in 11 light of these circumstances.
12 First, the Staff does not have a position 13 on the sufficiency of this or any provision in the 14 application, as the Staff has not completed its 15 technical or environmental reviews, but does find this 16 portion of Contention A to be admissible, as it meets 17 the individual requirements of 2.309(f)(i). And, as 18 discussed, the Staff believes that the Petitioner has 19 demonstrated standing.
20 The Applicant, in its answer and today, 21 counters on what I would call two principal grounds.
22 First, the application is accurate. The licenses 23 right now do say that the reactor is -- that they are 24 to retire in 2024 and 2025, and that it would be 25 rather speculative on the part of PG&E to assume NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
57 1 future regulatory actions: that they submit a renewal 2 license application, that the NRC would approve it, 3 and then to now, in the present, rely upon all that in 4 its application.
5 Further, as the Applicant notes, PG&E has 6 not actually submitted even a renewal application, and 7 has not even been timely renewed, notwithstanding the 8 timely renewal exemption that the Applicant requested 9 and the Staff issued this past March.
10 In response, I would say that the 11 Applicant is correct as to the current -- I think, as 12 you fashioned it; I liked it -- the legal regulatory 13 posture, sort of the legal reality, and, 14 understandably, stresses the potential, not certainty, 15 for the extension of reactor operating life. But I 16 think the Staff and Applicant differ on the 17 significance of these recent factual developments, in 18 light of the language in the application; 19 specifically, the linkage in the application between 20 the retirement of Unit 1 and the Applicant's 21 satisfaction of 72.22(b).
22 The potential extension of the Diablo 23 Canyon reactor licenses is relevant here because it 24 bears upon the availability of funding sources 25 identified in the application, in the ISFSI renewal NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
58 1 application.
2 Specifically, if the Applicant's recent 3 statements about its intent to continue Diablo Canyon 4 reactor operations is accurate, it is not clear that 5 decommissioning trust funds would be available to 6 support ISFSI operations in 2024.
7 Thus, in the Staff's view, this 8 disagreement between the Petitioner and the Applicant 9 over the significance of these events for the 10 Applicant's demonstration of compliance with 72.22(b) 11 is indeed a material dispute, and illustrates the 12 satisfaction of 2.309(f)(i)(6) regarding that 13 requirement. And so --
14 JUDGE HAWKENS: I think in your brief you 15 indicated you had no substantive concern, in the long 16 run, about PG&E and feel like it's financial 17 obligations. So why is it material?
18 MR. GENDELMAN: So, that's right, Your 19 Honor. And I think that gets to PG&E's second 20 argument, which has a couple of different forms that 21 you heard both today and in their answer, that either 22 a continued operation scenario where both rate case 23 funding followed by, at some time, decommissioning 24 trust fund funding is conservative vis-a-vis what's in 25 the application. I believe I saw something that even NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
59 1 SB 846 itself has some funding provisions. And that, 2 sort of in any scenario, given the cited Commission 3 case law about rate-making authority being sort of a 4 presumptive demonstration of reasonable assurance, 5 that, in any scenario, adequate funding would be 6 available, so the contention should not be omitted.
7 I think, with regard to all of these 8 arguments, the Staff has a short, if not pithy, 9 answer, in that I think we agree with the Petitioner 10 in their reply, that all these arguments may very well 11 be right, but they all get to the merits. Does the 12 Applicant satisfy 72.22(e), where the question here 13 is, has the petition satisfied the contention and 14 admissibility requirements?
15 It may very well be that the resolution of 16 this contention is -- and the Staff, once it completes 17 its safety review, may even agree -- that the 18 application, as it exists, now meets NRC requirements.
19 But that's a merits question. And at this point, I 20 don't think that begrudges the submission of an 21 admissible contention.
22 And I would sort of point again to the --
23 I think it's the Private Fuel Storage case we note in 24 our brief, that while the showing that a petitioner 25 needs to make at this phase is not insubstantial, a NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
60 1 petitioner doesn't have to prove their contention at 2 the contention and admissibility phase.
3 As to the other claims of Contention A 4 concerning a potential redesign of the ISFSI or the 5 need for increased capacity based on extended 6 operations, as well as financial assurance in 72.30, 7 the Staff views that these claims each fail for the 8 reason that 72.22(e) claim succeeds, because in this 9 cases the claims in the petition are not similarly 10 grounded in language in the application, which, in 11 turn, does not rely on a specific nuclear power plant 12 retirement date to demonstrate compliance with the 13 ISFSI license renewal requirements. Indeed, as the 14 Applicant notes, in many cases, the petition's 15 arguments are speculative, contrary to the specific 16 representations in the application. For example, 17 there is no request for an increase in the amount of 18 fuel to be stored at the ISFSI.
19 Similarly, with regard to Contention B, 20 arguing that the Applicant's environmental report is 21 similarly problematic because of its dependence on 22 2024 and 2025 Diablo Canyon reactor requirements, the 23 Staff views those claims as simply, again, not borne 24 out but language in the application.
25 Indeed, as the Applicant notes, the NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
61 1 proposed action, renewal of the independent spent fuel 2 storage installation license, is independent of 3 operations from the Diablo Canyon reactors in this 4 regard.
5 With respect to the alternatives analysis, 6 the petition does not seem to countenance the specific 7 discussion in the application, and, from the Staff's 8 view, argues that the environmental report lacks an 9 analysis that it appears to contain. With regard to 10 cumulative impacts, the petition does not identify any 11 impacts that are not considered cumulatively, and 12 while there's not a distinct section in the 13 environmental report titled "Cumulative Impacts,"
14 because the only direct impacts identified are public 15 and occupational dose, impacts that are evaluated 16 cumulatively, again, I think we have a contention that 17 alleges an omission that we believe is present.
18 And so, in summary, while the Staff has 19 not completed its technical or environmental reviews, 20 the petition proposes an admissible contention with 21 respect to financial qualifications under 72.22(e),
22 but the remainder of Contention A and Contention B are 23 inadmissible. They contain speculation about the 24 future, and not this application and its satisfaction 25 of the applicable NRC requirements in this Part 72 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
62 1 proceeding.
2 And, with that, I'd be happy to answer any 3 additional questions.
4 JUDGE ARNOLD: Just a practical matter.
5 What's the current schedule for the ISFSI license 6 renewal review? When is a decision expected?
7 MR. GENDELMAN: Yes, Your Honor. The 8 original docketing letter from September of last year 9 I think had targeted an RAI submission -- request for 10 additional information, RAIs -- in the February 11 timeframe, with an eye towards a decision in the 12 November timeframe. My understanding is that that 13 schedule has slipped and that a new schedule is being 14 formulated, but has not been finalized. I don't 15 believe RAIs have been issued yet, but I don't think 16 there's a new schedule.
17 JUDGE ARNOLD: My question arises -- if 18 the licensing decision came down in November, before 19 an application is due for the renewal of the operating 20 license, then its current status would reflect the 21 correct status at time of renewal. But if it's 22 delayed, then certainly you have to look at the 23 implications of plant license renewal.
24 MR. GENDELMAN: I understand, Your Honor.
25 And I don't believe a decision will be made this year.
NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
63 1 That said, I don't think, in the Staff's view, that 2 that's necessarily sort of the break point, in that, 3 we think, given the reality now, given the petition 4 before the Board, that with regard at least to the 5 financial qualification contention, that based on not 6 future, speculative "could submit/could not submit" 7 actions, but that, based on the world as it exists 8 today, that an admissible contention has been 9 proffered. So I'm not sure it's our view that that 10 would -- but I understand your concern.
11 JUDGE HAWKENS: I want to follow up on 12 your -- you disagree with Petitioner's argument at 13 Contention A, to the extent it deals with Section 14 72.30?
15 MR. GENDELMAN: That's right.
16 JUDGE HAWKENS: The decommissioning. And 17 I want to make sure I understand why that is. If I 18 understand Petitioner's argument, they point to 19 Appendix G-5, which states decommissioning estimate is 20 based on the configuration of the ISFSI, which, in 21 turn, is based on Units 1 and 2 operating until the 22 end of current licenses, 2024, 2025.
23 And it's your position that it can be 24 based on that because the ISFSI can accommodate 40 25 years of waste. And, therefore, it will only take in NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
64 1 waste until '24 and '25, and so that statement is 2 accurate. It doesn't matter whether they, in fact, 3 are retired in 2024 and 2025 or not?
4 MR. GENDELMAN: I would say it a little 5 more simply, actually. I think that, because of the 6 way the -- as the language cited by the Petitioner --
7 the 72.22 discussion specifically points to the 2024 8 retirement, and specifically identifies it as a 9 funding source the decommissioning trust fund at that 10 time, that the retirement sort of correlates to 11 demonstration of regulatory requirements in this 12 proceeding in a way that I think is at least more 13 iterated.
14 So, from a Staff perspective, it's not 15 clear to me whether or not that assessment being based 16 upon 2024 or 2025 retirement ultimately impacts the 17 sufficiency that that demonstration -- and, like I 18 said, Staff has not completed its safety review. But 19 in specifically the 72.22 case, where regulatory 20 compliance is specifically tied by the application to 21 the 2024 retirement of the facility, we believe that 22 the petition is articulated in genuine dispute.
23 JUDGE HAWKENS: I understand. Let me try 24 to simplify it even further. Would it be your view 25 that their reference to the retirement of the reactors NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
65 1 in the 2024 and 2025 for purposes of 72.30 are simply 2 not material?
3 MR. GENDELMAN: I think that's right, 4 given the structure of the regulation and the way that 5 portion of the application is structured. Again, with 6 no view on its ultimate sufficiency.
7 JUDGE HAWKENS: All right. Any more 8 questions? No?
9 No more questions for you. Thank you.
10 MR. GENDELMAN: Thank you, Your Honor.
11 JUDGE HAWKENS: Ms. Curran, I'm going to 12 check with my timekeeper, but I believe you have at 13 least 12 minutes left.
14 MS. CURRAN: Great.
15 JUDGE HAWKENS: She's nodding her head in 16 the affirmative, so you may proceed.
17 MS. CURRAN: Thank you. In response to 18 something Mr. Lighty said about how our claims only 19 relate to expansion, I just want to direct your 20 attention to the paragraph on the bottom of Page 5 of 21 our hearing request. This is really following up on 22 what NRC Staff counsel said, that our contention is 23 based on the fact that the license renewal application 24 depends on the assumption of a retirement date of 2024 25 and 2025. And we're expressing concern that there NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
66 1 will be a period of time now, potentially 20 years, 2 when PG&E does not have access to the decommissioning 3 trust fund.
4 So, thank you very much. We appreciate 5 the Staff's logical support for that contention. And 6 I also feel that the argument was persuasive on 72.30.
7 And that, I agree, it was a good argument, and I 8 didn't understand it before, that we haven't made an 9 adequate claim about the decommissioning fund, because 10 we did assume that the capacity of the ISFSI could be 11 increased, and it's just not there in the application.
12 13 Now, that's setting NEPA aside. I don't 14 want to imply at all that we are abandoning our NEPA 15 contention, because NEPA requires some consideration 16 of the big picture. And obviously --
17 JUDGE HAWKENS: Can you put NEPA aside for 18 one second?
19 MS. CURRAN: Yeah.
20 JUDGE HAWKENS: I'm looking at 72.30. So, 21 the NRC Staff says it agrees with you that Contention 22 A is admissible to the extent it raises a challenge 23 regarding PG&E's compliance with Section 72.22, I 24 believe. You also made a claim in Contention A that 25 their compliance with Section 71.30 was deficient.
NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
67 1 Are you no longer advancing that argument?
2 MS. CURRAN: That's right.
3 JUDGE HAWKENS: Okay.
4 MS. CURRAN: Yeah.
5 JUDGE HAWKENS: For purposes of Contention 6 A, you're simply saying that their showing financial 7 qualification for operating of the ISFSI under 72.22 8 is deficient.
9 MS. CURRAN: Yeah.
10 JUDGE HAWKENS: Okay. Thank you.
11 MS. CURRAN: On the NEPA claim, I just 12 want to make it really clear that our focus is on the 13 statement of purpose and need, which is a requirement, 14 to have a reasonably accurate statement of purpose and 15 need for the proposed action. This is a supplemental 16 environmental assessment. We continue to think that 17 if this is supplementing the previous environmental 18 assessment, this environmental assessment needs to go 19 back and discuss what was the purpose and need back 20 then, and then discuss what are -- you know, NEPA 21 requires a discussion of reasonably foreseeable 22 actions and impacts.
23 It's reasonably foreseeable that PG&E will 24 seek to expand the capacity of this ISFSI. If they 25 get 20 more years of operation, it's a real good NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
68 1 question, what are they going to do with the spent 2 fuel they generate? Especially since they answer to 3 the state, and the state wants them to take the fuel 4 out of the pools as expeditiously as possible. We 5 think all that needs to be addressed in the 6 environmental assessment. It's important.
7 This is the whole purpose of NEPA, that 8 you don't take an action until you've looked at all 9 the relevant considerations, so you don't foreclose 10 anything because you had tunnel vision. Clearly, 11 under the safety regulations, there is an element of 12 tunnel vision. But that's not true with respect to 13 NEPA.
14 And I still think -- we still think --
15 that the appropriate remedy here, if you don't admit 16 our contentions, is to hold this proceeding in 17 abeyance until we know what PG&E is going to do for 18 this license renewal application. Because this -- we 19 are not content to say PG&E may amend the ISFSI 20 license -- seek to amend the ISFSI license some point 21 down the road.
22 This is our opportunity right now. This 23 license renewal is being sought for 20 years. And we 24 -- or is it 40? It's a long time. This is our 25 opportunity. As members of the public, we know that NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
69 1 if you don't take the opportunity when it comes up, it 2 goes by and it may not come up again. We don't want 3 to rely on some discretionary decision by PG&E or the 4 NRC to amend this license.
5 The issues are before us now. We know now 6 that PG&E has invested resources into filing a new 7 license renewal application for this reactor, set of 8 reactors. Those considerations, it's really 9 important, for any environmental assessment that 10 addresses the impacts of the ISFSI, to look at all 11 those relevant considerations. And if more time is 12 needed, there's no reason not to give it.
13 That concludes my rebuttal.
14 JUDGE TRIKOUROS: We all agree, however, 15 that if there's an expansion of the ISFSI, or a 16 request to expand the ISFSI, it would be an entirely 17 new licensing proceeding, right?
18 MS. CURRAN: If there is a request for 19 expansion, yes. But we don't know when that will 20 happen. We don't know what the relationship will be 21 between storage in the pools and storage in the ISFSI.
22 Those are relevant environmental considerations that 23 PG&E could kick down the road for a long time, if it 24 wanted to. And we think it's important to address 25 them now, at least in a reasonably soon future, not NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
70 1 way down the road.
2 JUDGE HAWKENS: Thank you. Any more? No?
3 4 Thank you, Ms. Curran 5 MS. CURRAN: Thank you.
6 JUDGE HAWKENS: I want to thank the 7 parties, everyone's presentation, and their written 8 pleadings today. Very helpful. And it's our intent 9 to issue a decision on Petitioner's hearing request 10 within 35 days.
11 Before adjourning, I'd like to acknowledge 12 the support the Panel's IT expert, Andrew Welkie; the 13 Panel's administrative assistants, Sara Culler, Penny 14 Kenney (phonetic), and SherVerne Cloyd-Allen; the 15 Panel's law clerks, Noel Johnson, Allison Wood, and 16 Emily Newman. And lastly, we appreciate the services 17 of the court reporter, Lanelle Phillips.
18 And, Lanelle, will you need to consult any 19 attorneys after we adjourn to ensure accuracy of your 20 transcript?
21 COURT REPORTER: Yes, Mr. Bessette and Ms.
22 Curran.
23 JUDGE HAWKENS: All right. We'll just ask 24 counsel to remain until Ms. Phillips has had the 25 opportunity to talk to you.
NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com
71 1 Judge Trikouros, do you have anything to 2 add before we adjourn?
3 JUDGE TRIKOUROS: I do not. Thank you.
4 JUDGE ARNOLD: No.
5 JUDGE HAWKENS: The case is submitted and 6 we are adjourned. Thank you very much.
7 (Whereupon, the above-entitled matter went 8 off the record at 2:38 p.m.)
9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com