ML19269D343

Response by Public Utils Board of City of Brownsville,Tx to Central Power & Light Co First Set of Interrogatories & Request for Production of Documents.Certificate of Svc Encl

ML19269D343
Person / Time
Site:	South Texas, Comanche Peak, 05000449
Issue date:	04/30/1979
From:	Jablon R SPIEGEL & MCDIARMID
To:
References
NUDOCS 7906020119
Download: ML19269D343 (38)

Text

6R k UNITED STATES OF AMERICA Ty g ,g  ;

V ( g\

BEFORE THE '

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NUCLEAR REGULATORY COMMISSION d ph d3 BEFORE THE ATOMIC SAFETY AND LICENSING BOARD g 4

In the Matter of )

)

HOUSTON LIGHTING & POWER COMPANY, ) Docket Nos. 50-498A et al. ) and 50-499A

)

(South Texas Project, Unit Nos. )

1 and 2)

)

)

)

)

In the Matter of )

)

TEXAS UTILITIES GENERATING COMPANY,) Docket Nos. 50-445A et al. ) and 50-4AcA

)

(Comanche Peak Steam Electric )

Station, Unit Nos . 1 and 2) )

RESPONSE OF THE PUBLIC UTILITIES BOARD OF THE CITY OF BROWNSVILLE, TEXAS TO CENTRAL POWER AND LIGHT COMPANY'S FIRST SET OF INTERROGATORIES TO AND REQUEST FOR PRODUCTION OF DOCUMENTS FROM THE PUBLIC UTILITIES BOARD OF THE CITY OF BROWNSVILLE, TEXAS The Public Utilities Board of the City of Brownsville, Texas, hereby responds to Central Power and Light Company's First Set of Interrogatories To and Request For Production of Documents from the Public Utilities Board of the City of Brownsville, Texas.

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1 s Interrogatory No. 1(a) ,

1(a) Identify every request for electric service since January 1,1960 as to which the PUB was unable to pro-vide the requested service in whole or in part because of CPL's reiusal or failure to provide wheeling or other transmission services, by stating (i) the entity making the request (ii) the date of the request (iii) the period for which the service was requested (iv) the type (e.g., economy, firm, emergency, etc.) of service requested (v) the amount of electricity requested (vi) the price terms set forth in the request and (vii) the specific wheeling or other transmission services which if provided by CP&L would have enabled the PUB to provide the requested service.

Response

(a) PUB has never been forced to actually refuse electric service to any existing or potential customer.

However, as is shown in the attached documents concerning power supply negotiations between PUB and American Metals Climax, Inc. ("AMAX") in 1964 and between PUB and Harvey Aluminum Company, Inc. ("Harvey Aluminum") in 1965 and 1966, CP&L's refusal to provide backup and related transmission services in 1964, and again in 1966, contributed to PUB's f ailure to acquire AMAX cr Harvey Aluminum as industrial customers.

Early in 1964, AMAX sought a proposal from PUB outlining the terms and conditions under which PUB would be able to serve a proposed aluminum reduction plant were it located in the Port of Brownsville area. Service was sought to commence on May 1, 1966. The proposal PUB offered pro-vided that 120,000 kw of firm energy would be made available 2265 152

1 A at a time beginning at 3.15 mills per kwh, at a load factor of not less than 98%. In order to insure reliability of ner-vice, PUB requested CP&L to provide back-up services, a new power tie and related transmission services. The documents attached show that CP&L, which may also have been discussing a service proposal with AMAX during this time, responded to PUB's initial request with indications that back-up and other services could possibly be arranged. However, CP&L then postponed and otherwise avoided repeated attempts by PUB officials to meet and work out details and a definite commit-ment, and finally -- literally at the last minute -- refused to provide all the services that had been requested. This last minute refusal contributed to PUB's loss of what would have been a large and significant industrial load.

During June or July 1965, Harvey Aluminum was con-sidering the Port of Brownsville as a possible site location for a 100,000 ton per year aluminum reduction plant. In a proposal dated July 6, 1966 io construct a 375 nw electric generating station to serve an aluminum reduction plant, PUB offered to supply the reduction plant with its entire electric power requirements under a contract for a period of not less than thirty years, at an energy cost of initially 3.706 mills per kwh of firm energy. PUB again contacted CP&L regarding a standby power source arrangement, 2265 153

1 5 "in which energy flow either way would be on a ' swap out' basis and our excess generation sold to them at the direct production cost. We explained to Mr. JosJin that PUB agrees to build at its expense the transmission line from our plant to his plant, and install all facilities connected thereto." (July 22, 1966 letter from W. P.

Barnard, General Manager of PUB, to Leo M. Harvey of Harvey Aluminum, a copy of which is attached.)

Once again' CP&L refused to provide the requested services.

CP&L's refusal to cooperate in any way in providing the requested services -- which would have been to CP&L's benefit

-- contributed to PUB's loss of a potential large customer.

Interrogatory No. l(b)

(b) Produce for inspection and copying every document which relates to each request for electric service identified in your answer to Interrogatory 1(a), specifically including but not limited to every document stating impli-citly or explicitly that CPL's refusal or failure to provide wheeling or other transmission services was a contributing factor to the PUB's inability to provide the requested service.

Response

(b) Documents relating to PUB's response to this interrogatory are atcached. Documents concerning PUB's more recent loss of Union Carbide Company's Brownsville Plant to CP&L which are produced in response to Interrogatory No. 5 are also responsive to this interrogatory.

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i .

Interrogatory No. 2(a) 2(a) (i) Identify every entity which the PUB believes or contends refrained from requesting the PUB to provide it with electric service, in whole or in part because CPL would not provide wheeling or other transmission ser-vices, and (ii) state the approximate date each such inci-dent occurred.

Response

(a) PUB cannot identify with specificity entities which PUB believes refrained from requesting the PUB to pro-vide electric service, in whole or in part because CP&L would not provide wheeling or other transmission services.

However, as detailed more fully in response to Interrogatory No. 5(b), CP&L's past and continuing policies concerning both the planning and construction of transmission facilities in the southern part of its service area and the related transmission services have had a direct and adverse impact upon PUB's' cost and reliability of service. As is shown in the attached documents generally concerning the Brownsville Navagation District, its attempts to attract industry and its relations with PUB and CP&L, Navigation District officials have been concerned over a considerable period of time that reliability problems encountered by PUB in serving the Port area -- which problems result in substantial part from CP&L's restrictive and discriminatory transmission policies -- have hindered industrial development in that area. Further, while exact quantification is impossible , PUB believes that CP&L's refusals to provide transmission services and PUB's resulting 2265 155

3 ,

6-lack of access to alternative power supply sources restricted its ability to competitively expand its service area into area surrounding Brownsville (some of which has been sub-sequently incorpor ated within the City limits) . Some of this area was thus certified to CP&L and Magic Valley Electric Cooperative during the 1976 Texas Public Utilities Commission service area certification proceedings.

Documents particularly responsive to this matter of competitive injury are provided in response to Interrogatory No. 7.

Interrogatory No. 2(b)

(b) Produce for inspection and copying every document which relates to each incident in which the PUB believes or contends an entity refrained from requesting the PUB to provide it with electric service, in whole or in part because CPL would not provide wheeling or other transmission services.

Response

(b) Documents relating to PUB's response to this interrogatory are attached hereto, or are provided in response to other of these interrogatories as indicated above.

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s .

Interrogatory No. 3(a) and (b) ,

3(a) Identify each entity from which, since January 1, 1960, the PUB could have purchased electricity at a cost lower than that at which (i) the PUB could have generated, or did generate, its own electricity or (ii) the PUB could have purchased, or did purchase, electricity from CPL, if CPL would have provided wheeling or other transmission services.

(b) With respect to each entity identified in your answer to Interrogatory 3(a) state (i) the date on which each such offer to provide service was made to the PUB (ii) the period for which any offer of service was made (iii) the price at which the PUB could have purchased the electricity including (and identifying separately) any charge for wheeling or other transmission services by an entity other than CPL, but excluding any charge for wheeling or other transmission services which CPL would have imposed and (iv) the specific wheeling or other transmission services which if provided by CPL would have enabled the PUB to make the purchase.

Response

As is shown in the attached documents, since January 1, 1960, PUB probably would have been able to purchase electricity at a cost lower than the cost at which it could have generated its own electricity or the price at which CP&L was willing to sell PUB electricity, from a number of possible sources, including the Falcon Dam Power Plant, operated by the International Boundary and Water Commission, and the City Public Service Board of San Antonio.

Since CP&L has consistently refused to provide wheeling services, PUB has never been able to evaluate alter-native power supply possibilities with enough specificity tc respond to subsection (b) of this interrogatory as it is written. As is shown, the City Public Service Board has 2265 157

available, and is willing to sell to PUB, excess power, some of which is likely to be cheap coal-fired energy. PUB is statutorily entitled to the output of the Falcon Dam Power Plant before CP&L is. Were transmission services available

-- which they have not been -- power and energy from Falcon Dam might be an economic and highly desirable way in which to meet a portion of PUB"s load. The alternative has always been made infeasible by CP&L's refusal to wheel. Thus, PUB has never studied this alternative in detail.

Moreover, had PUB had free and non-discriminatory access to the bulk power supply market, the resulting com-petition would have had a downward influence on the price at which CP&L itself was willing to sell power to PUB.

This response is draf ted in response to. the exact question asked, which is misleading. Proper economic com-parisons over a long time period would have to take into account the amounts that CP&L will charge in the future, the risks which PUB is required to bear associated with purchase of power from CP&L, and the alternative costs in the future.

PUB's loss of access to new units planned in the past will, if costs continue to escalate, create increasing loss in com-parison with CP&L purchases.

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Interrogatory No. 3(c)

(c) Produce for inspection and copying every document which relates to each occasion on which the PUB could have purchased electricity from any entity other than CPL at a cost lower than that at which (i) the PUB could have generated, or did generate, its own electricity or (ii) the PUB could have purchased, or did purchase, electricity from CPL, if CPL would have provided wheeling or other transmission services.

Response

Documents responsive to this interrogatory are attached hereto.

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DOCUMENTS RESPONSIVE TO INTERROGATORY NO. 3 WITHHELD AS PRIVILEGED April 12, 1978 Letter to Robert E. Roundtree from John W. Davidson , RE: "Amistad and Falcon Hydroelectric Projects" June 21, 1978 Letter to Rcbert E. Roundtree from John A Heller, RE: " Protest to Application No, 3880 for Water Permit-STEC/MEC" July 11, 1978 Letter to Robert Roundtree from John W. Davidson , RE: " Texas Water Commission Application #3880" July 18, 1979 Letter to Larry Gawlik from Jan Bryant, RE: " Texas Water Commission Application No. 3880" December 22, 1978 Letter to Robert Roundtree from John W. Davidson, RE: "No. 282,544 -

201st District Court, Travis County, Texas - City of Brownsville, et 7.1.

v. Texas Department of Water Re',ources 1

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Interrogatory No. 4(a) 4(a) State (i) every date on which the PUB requested CPL to provide wheeling or other transmission ser-vices (ii) the specific wheeling or other transmission ser-vices requested and (iii) CPL's response to each such request to provide wheeling or other transmission services.

Response

4(a) As shown in the attached letters, PUB speci-fically requested discussions concerning wheeling services from CP&L on September 17, 1973, on February 17, 1976, and again on July 15, 1977. In 1973, PUB was concerned specifi-cally in negotiating a wheeling arrangement by which PUB could obtain power and energy from the South Texas Project, were PUB to purchase an ownership share in that project.

PUB's 1976 request was directed to obtaining a generally available transmission arrangement which included terms sufficiently specific to permit PUB to evaluate the economics and feasibility of obtaining bulk power supply from sources other than CP&L with a reasonable degree of precision for power supply planning purposes.

The 1977 request was directed specifically to capa-city and wheeling rates that would be involved in a power transaction between PUB and the City Public Service Board of San Antonio.

In response to each such request, CP&L stated that it did not provide transmission services. In its only written reply to a PUB request for transmission services, CP&L stated, "Since we have never participated in wheeling 2265 161

arrangements, we do not have the anticipated wheeling rates which you request." This August 8, 1977 letter from Mr.

Aaron Autry, President of CP&L, to Mr. H. E. Hastings is attached.

During 1964 and again in 1966, PUB sought back-up and related transmission services from CP&L in connection with PUB proposals to serve aluminum reduction refining plants which American Metals Climax, Inc., and Harvey Aluminum Company, respectively, were considering locating at the Port of Brownsville. In both instances, CP&L re, fused to provide such services. The events surrounding these requests are described in documents produced in response to Interrogatory No.1 and No. 2.

In addition to the written requests described above, PUB has raised the question of transmission services on numerous occasions during meetings and conversations con-corning interconnection arrangements, power purchase arrange-ments and other such matters. CP&L has consistently refused to provide transmission services, until the recent contract negotiations. While PUB has received no firm commitment that CP&L will now provide transmission services, the contract proposed by CP&L on February 23, 1979, does contain transmission provisions, although a minimum take restriction may effectively obviate the purported ability to use transmission services.

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During the past year, in the course of its current negotiations with CP&L to obtain a full interconnection agreement and related matters such as the planning and construction of transmission facilities in the South Texas area, PUB has continuously sought full and non-discriminatory access to such transmission. PUB desires the right to contribute to and be a part of the transmission grid and to purchase supplemental transmission services through a rate at FERC. See, for examples, letters of October 11, 1978 and November 1, 1978, from Mr. Robert E. Roundtree to Mr. R. W.

Hardy, CP&L's responses thereto, and intervention pleadings filed on behalf of PUB in the above captioned proceedings at the NRC. PUB assumes CP&L has copies of these documents in its possession and easily obtainable. If not, PUB is happy to make copies available.

Interrogatory No. 4(b)

(b) Produce for inspection and copying every document which relates to (i) each request by the PUB to CPL to provide wheeling or other transmission services and (ii) each response by CPL to any request by the PUB for CPL to provide wheeling or other transmission services.

Response

(b) Documents relating to PUB requests for transmission services and CP&L's responses thereto are attached hereto or in response to other of those interroga-tories as appropriately referenced above.

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Interrogatory No. 5(a) 5(a) With reference to the allegation (1 6, p. 3) in the PUB's Supplemental Petition for Leave to Intervene that " PUB must have access to CPL's transmission system to service industrial loads", identify each industrial . load which the PUB has been unable to serve due, in whole or in part, to lack of access to CPL's transmission system by (i) identifying the customer or potential customer (ii) stating the approxime'_' date when the PUB first learned that it would be unable to dorve that specific load (iii) stating which entity did supply the electric energy requirements of the customer or potential customer (iv) stating every reason why the PUB did not obtain the right to serve that specific load and (v) identifying the specific nature of the access to CPL's transmission systrem which would have enabled the PUB to serve that specific load.

Response

(a) Documents and information provided in response to Interrogatory No.1 are also responsive to this interroga-tory.

As further detailed in the attached documents, on April 13, 1976 Union Carbide Corporation (" Union Carbide"),

which was at that time served by PUB under a back-up power contract, announced expansion plans and the need for addi-tional electric power, approximately 40,000 kw with capacity available for 55,000 kw peaks, delivered at 138,000 volts.

PUB was at this time formally asked whether it would be able to supply the requested service.

It should be noted, however, that in a letter to Brownsville Navigation District officials dated April 8, 1976, Mr. William McManus, of Union Carbide, had stated that in that Company's analysis only Central Power & Light Company would be capable of meeting Union Carbide's expanded electri-2265 l64

city needs, and had already requested that the Navigation District take the necessary steps to grant CP&L the right to supply Union Carbide's requirements.

During a meeting between PUB and Navigation District officials on April 22, 1976, a general agreement was reached whereby PUB agreed to allow the Brownsville Navigation District the option to contract with CP&L to supply power to Union Carbide. While PUB agreed that CP&L would be allowed to serve Union Carbide, should Union Carbide so desire, on May 11, 1976, Mr. Israel Lizka, Chairman of the Public Utilities Board also responded to the April 13, 1976 letter from the Navigation District, and set forth the PUB's specific plans to satisfy Union Carbide's needs.

It was within PUB's technical capability to serve the proposed Union Carbide load, if PUB were able to obtain from CP&L full performance of CP&L's contract obligations under the terms of the 1971 power supply agreement in force between them.

In addition, fully reliabile service to Union Carbide would require the installation of 138 kv transmission facilities between PUB and CP&L in the immediate Brownsville drea. Such 138 kv transmission had been under consideration 2265 165

by CP&L and PUB for some time prior to Union Carbide's 1976 request, and both CP&L and PUB have recognized that increased transmission facilities were or would be necessary to insure reliability of service to the Brownsville area. Indeed, at least as early as 1974, PUB had proposed and requested that additional transmission facilities be installed between CP&L and PUB facilities.

As shown in the attached correspondence, it seemed evident to PUB at the time of the 1976 Union Carbide request that CP&L did not intend voluntarily to meet its contract obligations, nor did it appear willing to cooperate in the installation of 138 kv transmission so as to benefit both PUB and CP&L.

Moreover, as shown in documents produced in response to Interrogatory No. 2, the Brownsville Navigation District sought the availability of CP&L service out of fears that PUB service might be unreliable. It is clear that if CP&L had provided necessary power supply and transmission services, PUB would have been able and desirous of continuing to serve Union Carbide. While PUB desired -- and is still willing -- to serve the Union Carbide load, CP&L's continuing refusal to provide both future economic power supply and a reliabile means by which to obtain it, seriously and effeci-vely impedes PUB's ability to offer competitive power ser-vices to Union Carbide (or similar customers).

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Interrocatory No. 5(b)

(b) Explain how the PUB's ability to serve industrial loads in the future will or may be affected by whether the PUB has access to CPL's transmission system.

Response

(b) PUB's ability to serve future industrial loads is adversely affected by CP&L's restrictive transmission policies for the same reasons it was unable to effectively compete for the Union Carbide load: (1) without the installa-tion of looped 138 kv transmission facilities, adequate for the reliable transmission of power supply to meet expanding load, PUB is unable to guarantee the reliability necessary to serve certain large industrial load (such as aluminum reduc-tion plants; and (2) without full and non-discriminatory availability of transmission services, PUB is deprived of the access to the bulk power supply market, which would enable PUB to compete on equal terms with other electric utilities for the most economic power supply available.

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DOCUMENTS RESPONSIVE TO INTERROGATORY NO. 5 WITHHELD AS PRIVILEGED March 31, 1976 Letter to H. E. Hastings from O. B. Garcia, RE: Contract obligations under power purchase agreament bet-ween CP&L & PUB April 2, 1976 Letter to Hon. Israel Lizka from O. B. Garcia , RE: Contract obligations under power purchase agreement bet-ween CP&L & PUB April 2, 1976 Memorandum Opinion to PUB from John Davidson, RE: " Legal Aspects of Proposed Electric Power Agreement Between Union Carbide and Central Power & Light Company" 2265 168

' Interrogatory No. 6 6(a) Identify every request which the PUB has made for participation in the ownership of any generating plant or unit owned in whole or in part by CPL including but not limited to the South Texas Project ("STP"), by identifying (i) the date each such request was made (ii) whether the request was written or oral (iii) the person making the request and the person to whom the request was directed (iv) the specific content of the request (v) the specific content of the response to the request and (vi) the person making the response and the person to whom the response was directed.

Response

6(a) PUB has never received an offer to par-ticipate in any generating plant or unit owned in whole or in part by CP&L, upon which it could base a firm request.

Nonetheless, PUB has from time to time expressed its desire for an opportunity to participate with CP&L in the ownership of generating facilities of various types , both existing and planned and continues to do so. It has inter-vened in Docket Nos. 50-498A and 50-499 to secure such rights and related relief.

During the period 1961 through 1963, a number of discussions were had concerning CP&L participation in a pro-posed generating facility known at the time as " Plant X."

As is shown in the group of documents attached hereto labeled Plant X, a number of contacts occurred between representatives of CP&L and PUB during this period. The attached list describes certain of these contacts specifi-cally. Additional unreported contacts probably occurred bet-ween CP&L and PUB during this period d" ring which the matter of CP&L participation in " Plant X" was o_scussed, but cannot now be recalled with detail.

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Sometime prior to September 17, 1973, a Central Power & Light Company representative visited with Mr. H. E.

Hastings, then General Manager of PUB, "to announce the pro-posed nuclear project." In a letter dated September 17, 1973 addressed to Mr. R. E. Horine, Executive Vice President of CP&L (a copy of which is attached), Mr. Hastings stated :

"It was unclear whether we were being given an oppor-tunity to participate or not. We would be interested in the possiblity if agreements could be reached on wheeling arrangements or displacement."

It is Mr. Hasting's recollection that the South Texas Project participation " offer" was presented in a nega-tive fashion, with the suggestion that CP&L, while required by law to make the offer, did not wish to do so, and that in any event, PUB would as a practical matter, be unable to par- .

ticipate in the project because: (1) it could not afford to, and (2) it had no wheeling contract with CP&L and such a contract was necessary to enable PUB to transport its share of the STP generation from the plant to Brownsville . As described more fully in response to Interrogatory No. 4, (and as stated by Mr. Aaron Autry in his letter to Mr. H. E. Hastings dated August 8, 1977), CP&L "has never participated in wheeling arrangements, . . . " and had no ". . . plans for future transmission construction which would include surplus transmission capacity for wheeling power."

As pointed out in Mr. Hastings' September 17, 1973 letter, PUB's ability to participate in the proposed nuclear project was contingent upon agreements concerning wheeling 2265 170

, , arrangements. CP&L had theretofore been unwilling to provide such wheeling services and, as evidenced in Mr. Autry's August 8, 1977 letter, did not modify its historically restrictive transmission policies in response to PUB's requests conct. ning a wheeling arrangement relating to the South Texas Project. PUB never received a formal written reply to Mr. Hastings' September 17, 1973 letter.

During a meeting on June 9, 1974, at which a number of CP&L representatives were present, including Messrs.

Horine, Siegelin, Smith, Orsak, and Taylor, a number of sub-jects were discussed, including the South Texas nuclear pro-ject. PUB interest in participating in the project was again expressed provided some reasonable wheeling agreement could be arranged. Mr. Hastings' notes taken during this meeting are attached.

In a letter to Mr. Aaron E. Autry dated February 17, 1976, Mr. Hastings requested a meeting with appropriate CP&L personnel in which to discuss, among other subjects, the "possible joint ownership of generating resources." As with previous expressions by PUB of its interest in participating with CP&L in the planning and/or ownership of generating facilities, CP&L did not formally reply to Mr. Hasting's February 17, 1976 letter.

In addition to those requests documented in the correspondence and notes attached, the issue has been brought up from time to time during meetings and conversations con-2265 171

22 -

cerning other matters. See, for example, CP&L's letter of March 9, 1979. Joint ownership and planning of generating facilities has been and continues to be desired by POB as being a source of economic and efficient bulk power of bene-fit to all participants.

Interrogatory No. 6(b)

(b) Produce for inspection and copying ~every document which relates to (i) each request by the PUB for participation in the ownership of any generating plant or unit owned in whole or in part by CPL including but not limited to the STP and (ii) each response to each such request by the PUB.

Response

(b) All documents relating to PUB requests for participation in the owneship of generating plants are owned in whole or in part by CP&L are attached hereto. CP&L responded to all PUB requests orally, except for its March -9, 1979 letter to PUB, a copy of which is attached.

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Interrogatory No. 7 7(a) Describe the ways in which and the extent to which the PUB competes with other electric utilities.

Response

PUB is in vigorous competition with other electric utilities, both adjacent and in the larger south Texas area, for (1) retail load (2) industrial load, and (3) bulk power supply. If it had access to transmission and coordination services, PUB could compete in bulk power supply markets for the purchase of both firm and non-firm short and long term power supply and the sale of electrical energy and capacity to other systems.

(1) As shown in the documents attached hereto, PUB competes with the Magic Valley Electric Cooperative, Inc.,

and CP&L for residential retail customers. El Valle North and Iowa Estates II subdivisions were located directly in the growth pattern of Brownsville and have been annexed into the Brownsville city limits. However, this area is dually cer-tified to CP&L and Magic Valley -- which are not even franchised to operate within the city limits of Brownsville.

The developers of these subdivisions have requested and prefer service from PUB, which desires to provide service.

The fact that litigation before the PUC to settle the question of which electric utility should serve these custo-mers is ample evidence of competition.

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(2) Competition between PUB and CP&L to acquire large industrial load is clear and well documented. For example, see documents concerning the 1964 negotiations between the Brownsville Navigation District, the Public Utilities Board and American Metals Climax produced in response to Interrogatory No.1 and No. 2.

It appears that CP&L representatives were meeting with American Metals Climax in an attempt to encourage that company to locate a new aluminum plant in the CP&L service area at the same time that PUB together with the Brownsville Navigation District were actively negotiating with AMAX to locate e.t the Port of Brownsville. CP&L was well aware of the PUB-BND-AMAX negotiations since PUB had requested certain limited back-up and transmission services from CP&L in con-nection with plans to install substantial new generation to meet the AMAX load (which would have been about 100 MW).

Indeed, various CP&L officials indicated, until the day before PUB and BND representatives were to go to New York with a finalized proposal, that the company would probably be willing to provide the requested services, in whole or in part. The day before this New York trip, CP&L flatly refused to provide any of the requested services. AMAX located the proposed plant in the Pacific Northwest. CP&L's last minute refusal to provide a back-up tie and otherwise deal with PUB made the PUB-BND proposal far less attractive to AMAX than it would have otherwise been.

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Competition between PUB and CP&L to serve Union Carbide's Brownsville plant which is located at the Port of Brownsville has been intense (as is shown in documents pro-duced in response to Interrogatory No. 5). Until recently, Union Carbide received back-up power under a contract with PUB. CP&L has taken over this customer recently, following a number of years of both open and not-so-open negotiating bet-ween CP&L, Union Carbide and possibly BND representatives.

Additional instances of competition to acquire and/or serve large industrial customers are shown in docu-ments attached hereto and in documents provided in response to Interrogatory No. 2.

(3) PUB presently competes with other electric utilities in the south Texas area for economic bulk power supply.

As shown in documents provided in response to Interrogatory No. 3, PUB has been interested for some time in power and energy generated in the federal hydroelectric generating projects located at the Falcon and Amistad dams on the Rio Grande River. This power and energy has been, at least temporarily, obtained by CP&L.

PUB has also, during the past two years in par-ticular, been exploring the possibility of obtaining power from the City Public Service Board of San Antonio (see docu-ments produced in response to Interrogatory No. 3). While PUB has been entangled in negotiations with CP&L to obtain 2265 175

power services, including transmission services, San Antonio and Medina Electric Cooperative concluded, early this year, a power supply agreement -- reducing substantially the amount of inexpensive power for which PUB can now negotiate.

Interrogatory No. 7(b)

(b) Produce for inspection and copying every document which relates to the competition described in your answer to Interrogatory 7(a).

Response

Documents relating to the competition described above are either attached hereto or are provided in response to other of these interrogatories and have been appropriately referenced above.

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Interrogatory No. 8 8(a) State, for each year since 1970, the peak load on the PUB's system, the PUB's generating capacity at the time the peak load was experienced and the PUB's firm purchases and/or sales at that time.

Response

Firm Power Generating Capacity Purchases at Annual Peak at Time of Peak Times of Peak Load, MW Load, MW Load, MW 1970 54.0 68.0 s 1971 56.9 68.0 -

1972 68.4 68.0 1/

1973 81.4 113.0 1974 95.7 113.0 1975 94.7 119.6 15.0 1976 95.7 119.6 24.0 1977 102.5 119.6 27.0 1978 108.5 113.0 29.0

~

1/ In 1972, PUB was able to meet its peak load of 68.4 MW with its installed or nameplate generating capacity of 68 MW.

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Interrogatory No. 8(b)

(b) State, by year for each of the next ten years, the PUB's anticipated peak load, generating capacity expected to be installed at that time and the firm purchases and/or sales which the PUB has already contracted for.

Response

Firm Power Anticipated Anticipated Installed Purchases at Annual Feak Generating Capacity, Times of Peak Load, MW MW Load, MW 1979 117.4 113.0 1980 124.2 -

3/ 37.4 1981 132.0 -

2/

1982 140.2 1983 148.8 1984 158.1 1985 168.1 1986 179.3 1987 191.5 1988 204.6

-2/ The 1971 Power Purchase Agreement between CP&L and PUB which by its terms expires at the end of 1981, provides that PUB may increase its firm power purchases by up to 10 MW annually, but that in no event shall PUB purchase, under the existing contract, firm power in excess of 60 MW.

3/ For the period 1980 to 1988, PUB does not have a speci-fic generation expansion plan developed. PUB is con-sidering a number of generation expansion alternatives, including joint ownership participation in large coal or nuclear generating units. In order for PUB to obtain construction of necessary transmission facilities, CP&L has insisted that PUB pay for such construction through the purchase of wholesale power, to which PUB was forced to accede , and has proposed a minimum demand. PUB does not know the basis for this minimum demand.

2265 178

Interrogatory No._9

9. Sta :e the name, business address , residence address, and position in or affiliation with the PUB of each person who provided information in connection with the PUB's answers to any or all of these Interrogatories, and indicate by number those Interrogatories with respect to which each such person provided information.

Response

Interrogatories With Respect To Which Information Was Provided Business Address Residence Address 1-7 Mr. Robert E. Round tree 205 Calle Amistosa General Manager #138 Public Utilities Board Brownsville , Tx . 78520 1425 Robinhood Brownsville, Texas 78521 (512)S46-2241 1-7 R. Michael Simmons, Esq. 2727 Old Alice Rd . #8 Staff Counsel Brownsville, Tx. 78520 Public Utilities Board 1425 Robinhood Brownsville, Texas 78521 (512)546-2241 3, 4, 5, 7, 8 Mr. Larry R. Gawlik 26 Casa Grande Associate General Manager Brownsville, TM. 78520 for Engineering Public Utilities Board 1425 Robinhood Brownsville , Texas 78521 (512)S46-2241 1, 2, 6, 7 Mr. George Lindsey, III 67 Shoreline Associate General Manager Brownsville, Tt . 78520 for Administration Public Utilities Board 1425 Robinhood Brownsville, Texas 78521 (512)S46-2241 1, 2, 5, 7 Mr. Israel Liska 44 Calle Anacua Chairman and Member, Brownsville, Tx. 78520 Public Utilities Board P. O. Box 3270 Brownsville , Texas 78520 Public Utilities Board member: 1974 until about July 1975 Chairman, Public Utilities Board , July 1975 -

August 1978 2265 179

Interrogatories With Respect Tb Which Information Was Provided Business Address Residence Address Present business address:

Casa De Nylon 1304 East Adams Brownsville , Tx . 78520 1, 2, 5, 7 Mr. Al Cisneros 54 McFatten General Manager and Brownsville, TM. 78520 Port Director Brownsville Navigation District, Port of Brownsville Navigation District Bldg..

P. O. Box 3070 Brownsville , Texas 78520 (512)831-4592

~

1, 2, 5, 7 Mr. Ersel G. Lantz 308 Scott Director of Engineering Brownsville, Tt. 78520 and Port Development Brownsville Navigation District, Port of Brownsville

. Navigation District Bldg.

P. O. Box 3070 Brownsville , Texas 78520 (512)831-4592 1 through 7 Hon. Ruben Edelstein 64 Robins Lane Mayor Brownsville, Tt. 78520 City of Brownville P. O. Box 911 Brownsville , Texas 78520 (512)S42-4391 Chairman, Public Utilities Board: July 1960 -

July 1967 Mayor, City of Brownsville: November 1975 to date 1 through 7 Mr. H. E. Hastings 1914 Beckert Drive 219 West Water Street Piqua, Ohio 53356 Piqua, Ohio 45336 General Manager, Public Utilities Board, September 1971 - September 1977 2265 180

31 -

Interrogatories With Respect To Which Information Was Provided Business Address Residence Address 3 through 6 Mr. Mark D. Stenson 504 146th Place, N.E.

Partner Bellevue, Wash. 98007

~

R. W. Beck & Associates 200 Tower Building Seattle , Washington 98101 (206)622-5000 Consulting Engineer to PUB: 1972 - 1976 2265 181

32 -

Interrogatory No. 10(a) 10(a) Identify each person whom the PUB expects to call as an expert witness at the trial of this cause by stating each such person's name, occupation and business address.

Response

PUB is considering formal retention of the following consultants to review economic and engineering fac-tors relating to this case:

(a) 1. Dr. John W. Wilson, President of J. W. Wilson & Associates, Economic Consultants The Dodge Center 1010 Wisconsin Avenue, N. W.

Washington, D. C. 20007 (202)333-7442

2. William R. Mayben, Partner R. W. Beck & Associates P. O. Box 68 Columbus, Nebraska (402)564-3251 Other expert witnesses may be added to this list when PUB learns what witnesses will be called by other par-ties and the substance of their testimony and its assessment of its needs.

Interrogatory Nos. 10(b)-(c)

(b) State the subject matter on which each per-son identified in your answer to Interrogatory 10(a) is expected to testify.

(c) State (i) the substance of the facts and opinions to which each person identified in your answer to Interrogatory 10(a) is expected to testify and (ii) a summary of the grounds for each such opinion.

Response

1. Dr. Wilson will examine the competitive situation in the electric utility industry in Texas and the economic impact on Brownsville and other such electric utili-2265 182

ties of the " intra-state only" policy presently in effect as to the Texas Interconnected System. Included in this exami-nation may be an analysis of the role of competition in the electric utility industry, relevant markets and the criteria used in establishing the relevant markets, an evaluation of the Applicants' market power in the relevant markets and their conduct in those markets, and an analysis of the econo-mic impact of present power supply and market factors as they related to PUB.

In addition, Dr. Wilson will be asked to review the economic and competitive impact on PUB of limitations on transmission and bulk power supply availability.

2. Mr. Mayben may testify concerning general prin-ciples of joint planning and operation in the electric uti-lity industry, including reserve sharing; economy exchange and other forms of power exchange commonly provided for in interconnected operation in the industry; wheeling and other transmission services; and he will be asked to analyze these principles as they apply in Texas, and in the South Texas area.

In addition, Mr. Mayben will look at the transmission system and the bulk power supply situation as it exists and is presently planned in the Rio Grande Valley, with particular focus on the resulting impact of those transmission and power supply arrangements on PUB.

Mr. Mayben may be asked to analyze the various fuel supply alternatives in Texas, again with particular reference to PUB.

2265 183

UNITED STATES OF AMERICA BEFORE THE NUCLEAR REGULATORY COMMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD In the Matter of )

)

HOUSTON LIGHTING & POWER COMPANY, ) Docket Nos. 50-498A et al. ) and 50-499A

)

(South Texas Project, Unit Nos . )

1 and 2) )

)

)

In the Matter of )

)

TEXAS UTILITIES GENERATING COMPANY,) Docket Nos . 50-445A _

et al. ) and 50-446A

)

(Comanche Peak Steam Electric )

Station, Unit Nos . 1 and 2) )

VERIFICATION I, Robert A. Jablon, being first duly sworn, depose and state that I am counsel for the Public Utilities Board of the City of Brownsville, Texas, that the foregoing Response of the Public Utilities Board of the City of Brownsville, Texas, to Central Power & Light Company's First Set of Interrogatories to and Request for Production of Documents fron the Public Utilities Board of the City of Brownsville, Texas, was prepared at my direction and under my supervision, that I have reviewed such Response, and that the information and matters set forth therein are true and correct to the best of my information, knowledge and belief.

AbYA Robgrt A. Jablon Subscribed and Sworn to beforp me this 30th day of April,1979.

~s 1 ,{ 4 L ,- 1 zz i hiu UL/

/ u MT I='^=ica Erpires Sectember 30. Isas 2265 l84

UNITED STATES OF AMERICA BEFORE THE NUCLEAR REGULATORY COMMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD In the Matter of )

)

HOUSTON LIGHTING & POWER COMPANY, ) Docket Nos. 50-498A et al. ) and 50-499A

)

(South Texas Project, Unit Nos. )

1 and 2) )

)

)

)

In the Matter of )

)

TEXAS UTILITIES GENERATING COMPANY,) Docket Nos. 50-445A et al. ) and 50-446A

)

(Comanche Peak Steam Electric )

Station, Unit Nos. 1 and 2) )

AFFIRMATION OF SERVICE DISTRICT OF COLUMBIA, ss:

I, SUSAN G. WHITE, being first duly sworn, affirm that copies of the foregoing RESPONSE OF THE PUBLIC UTILITIES BOARD OF THE CITY OF BROWNSVILLE, TEXAS TO CENTRAL POWER AND LIGHT COMPANY'S FIRST SET OF INTERROGATORIES TO AND REQUEST FOR PRODUCTION OF DOCUMENTS FROM THE PUBLIC UTILITIES BOARD OF THE CITY OF BROWNSVILLE, TEXAS in the above-captioned pro-ceeding have this 30th day of April, 1979 been served upon the following persons by deposit in the U. S. mail, first class, postage prepaid.

Marshall E. Miller, Chairman Joseph J. Saunders, Esquire Atomic Safety & Licensing Board Chief, Public Counsel &

Panel Legislative Section Nuclear Regulatory Commission Department of Justice Washington, D. C. 20555 P. O. Box 14141 Washington, D. C. 20044 Sheldon J. Wolfe, Esquire Atomic Safety & Licensing Board Joseph Gallo, Esquire Panel Richard D. Cudahy, Esquire Nuclear Regulatory Commission Robert H. Loe f fler , Esquire Washing ton , D. C. 20555 Isham, Lincoln & Beale Suite 701 Michael L. Glaser, Esquire 1050 17th Street, N. W.

1150 17th Street, N. W. Washington, D. C. 20036 Washington, D. C. 20036 2265 185

• * . - John D. Whitler, Esquire Joseph Rutberg, Esquire Ronald Clark, Esquire Antitrust Counsel Department of Justice Counsel for NRC Staff P. O. Box 14141 Nuclear Regulatory Commission Washing ton , D. C. 20044 Washington, D. C. 20555 Joseph Knotts, Esquire Chase R. Stephens, Chief Nicholas S. Reynolds, Esquire Docketing and Service Section Debevoise & Liberman Office of the Secretary 1200 17th Street, N. W.

Nuclear Regulatory Commission Washington, D. C. 20036 Washington, D. C. 20555 Douglas F. John, Esquire Joseph I. Worsham, Esquire Akin, Gump, Hauer & Feld Merlyn D. Sampels, Esquire 1100 Madison Office Building Worsham, Forsythe & Sampels 1155 15th Street, N. W. 2001 Bryan Tower, Suite 2500 Washington , D. C. 20024 Dallas, Texas 75201 R. Gordon Gooch, Esquire Spencer C. Relyea, Esquire John P. Mathis, Esquire Worsham, Forsythe & Sampels Baker & Botts 2001 Bryan Tower, Suite 2500 1701 Penn 3ylvania Avenue , N. W. Dallas, Texas 75201 Washington , D. C. 20006 R. L. Hancock, Director Robert Lowenstein, Esquire City of Austin Electric J. A. Bouknight, Jr., Esquire Utility Department Lowenstein, Newman, Reis & P. O. Box 1088 Axelrad Austin, Texas 78767 1025 Connecticut Avenue , N. W.

Washing ton , D. C. 20036 Jerry L. Harris, Esquire City Attorney William J. Franklin, Esquire City of Austin Lowenstein, Newman, Reis & P. O. Box 1088 Axelrad Austin, Texas 78767 1025 Connecticut Avenue, N. W.

Washington, D. C. 20036 Richard C. Balough, Esquire Assistant City Attorney Frederick H. Ritts, Esquire City of Austin Law Offices of Northcutt Ely P. O. Box 1088 Watergate 600 Building Austin, Texas 78767 Washington, D. C. 20037 Dan H. Davidson Wheatley & Wolleson City Manager 1112 Watergate Office Building City of Austin 2600 Virginia Avenue, N. W. P. O. Box 1088 Washington, D. C. 20037 Austin, Texas 78767 2265 186

Roff Hardy, Chairman and Chief Don R. Butler, Esquire Executive Officer Sneed, Vine, Wilkerson, Selman Central Power & Light Company & Perry P. O. Box 2121 P. O. Box 1409 Corpus Christi, Texas 78403 Austin, Texas 78767 G. K. Spruce , General Manger Morgan Hunter, Esquire City Public Service Board McGinnis, Lochridge & Kilgore P. O. Box 1771 900 Congress Avenue San Antonio, Texas 78203 Austin, Texas 78701 Jon C. Wood, Esquire Kevin B. Pratt, Esquire W. Roger Wilson, Esquire Assistant Attorney General Matthews, Nowlin, Macfarlane P. O. Box 12548

& Barrett Capital Station 1500 Alamo National Building Austin, Texas 78711 San Antonio, Texas 78205 Linda L. Aaker, Esquire Perry G. Brittain, President Assistant Attorney General Texas Utilities Generating P. O. Box 12548 Company Capital Station 2001 Bryan Tower Austin , Texas 78711 Dallas, Texas 75201 E. W. Barnett, Esquire John E. Mathews, Jr., Esquire Charles G. Thrash, Jr., Esquire Mathews, Osborne, Ehrlich, Baker & Botts McNatt, Gobelman & Cobb 3000 One Shell Plaza 1500 American Heritage Life Bldg.

Houston, Texas 77002 Jacksonville, Florida 32202 J. Gregory Copeland, Esquire Robert E. Bathen Theodore F. Weiss, Jr., Esquire R. W. Beck & Associates Baker & Botts P. O. Box 6817 3000 One Shell Plaza Orlando, Florida 82803 Houston, Texas 77002 Somervell County Public Library G. W. Oprea, Jr. P. O. Box 417 Executive Vice President Glen Rose , Texas 76403 Houston Lighting . Power Company P. O. Box 1700 Maynard Human, General Manager Houston, Texas 77001 Western Farmers Electric Coop.

P. O. Box 429 Anadarko, Oklahoma 73005 2265 187

e r. .

W. S. Robson, General Manager South Texas Electric Cooperative, Inc. James E. Monahan Route 6, Building 102 Executive Vice President and Victoria Regional Airport General manager Victoria, Texas 77901 Brazos Electric Power Coop. , Inc.

P. O. Box 6296 Michael I. Miller, Esquire Waco, Texas 76706 Richard E. Powell, Esquire Isham, Lincoln & Beale Judith Harris, Esquire One First National Plaza Department of Juctice Chicago, Illinois 60603 P. O. Box 14141 Washington, D. C. 20044 David M. Stahl, Esquire Thomas G. Ryan, Esquire Jerome Saltzman, Chief Isham, Lincoln & Beale Antitrust & Indemnity Group One First National Plaza Nuclear Regulatory Commission Chicago, Illinois 60603 Washington, D. C. 20555 Knoland J. Plucknett Jay M. Galt, Esquire Executive Director Looney, Nichols, Johnson &

Committee on Power for the Hayes Southwest, Inc. 219 Couch Drive 5541 Skelly Drive Oklahoma City, Oklahoma 73101 Tulsa, Oklahoma 74135

>da - Susa ~.

tite

/e i SUBSCRIBED AND SWORN TO before me, a Notary Public in and for the City of Washington, District of Columbia, this 30th day of April, 1979.

,']

_.- 3 -

Y rtcv . &pU. 5$)

v MY hsion Erpires Sec. ember 31, 1959 2265 188