ML20214D039

Responds to Bouknight in Response to NRC Re Notice of Violation of Antitrust License Condition. Equity Component Rate for AFUDC in Bouknight Ltr Highly Ambiguous

ML20214D039
Person / Time
Site:	Farley
Issue date:	11/18/1986
From:	Macguineas D VOLPE, BOSKEY & LYONS
To:	Harold Denton Office of Nuclear Reactor Regulation
References
A, NUDOCS 8611210332
Download: ML20214D039 (2)

Text

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VOLPE, BOS KEY AN D LYO N S WORLD CENTER BUILDING 918 86M ST R E ET, N. W.

WASHINGTON, D. C. 2OOO6 JOS EPH VOLPE, JR. (202)737-6580 SENN ETT BOSKEY ELLIS LYONS EDWARD A.GROOB ERT D. 8I ARD M ACGUIN EAS Eowm E. HUootESON,m November 18, 1986 EVA F. S H E RM AN PATRICIA A. M AYER Dr. Harold R. Denton Director Office of Nuclear Reactor Regulation Nuclear Regulatory Commission Phillips Building, Room P404A 7920 Norfolk Avenue Bethesda, Maryland 20555 Re: Alabama Power Company, Notice of Violation of Antitrust License Condition (Joseph M.

Farley Nuclear Plant, Units 1 and 2)

Docket Nos. 50-348A, 50-364A

Dear Dr. Denton:

This is in brief response to Mr. Bouknight's letter to you of November 5, 1986. Mr. Bouknight's letter responds to a few of the issues addressed in AEC's Reply of October 17, 1986.

With respect to the equity component rate for AFUDC, Mr.

Bouknight's letter (pp. 1-2) is highly ambiguous, making it l

impossible to determine whether or not APCo is " agreeing to the use of its actual equity returns as annually reported to FERC."

(AEC Reply, p. 19).

Similarly, while Mr. Bouknight's letter (p. 2) states that "APCo has recently refined its calculation of the estimated sales price," it is impossible to determine from the conclu-sionary information furnished what these refinements mean or how they have been derived from, or relate to, the price data i

previously furnished by APCo (Tab C to AEC's request for enforcement dated June 29, 1984, " Data Request Item 6).

As elaborated on in previous correspondence AEC strongly l disagrees with APCo's demands for a security interest, particu-( larly since APCo is not advancing any credit.

! With respect to the default provision, originally suggested by NRC Staff, we find no basis in APCo's fuel clauses l for a concern that energy acquired by APCo from AEC's owned portion of the nuclear units would be treated any differently 8611210332 861118 PDR ADOCK 05000348 E$ 9ff h PDR

b VoLPE, BOSKEY AND LY o N S Page Two than any other energy purchased by APCo. The concern alleged in Mr. Bouknight's letter (p. 3) is unsupported speculation.

Obviously--contrary to what is said in that letter-- AEC would

" suffer" from the loss of energy in the event the default provision were invoked.

Likewise, the speculation in Mr. Bouknight's letter (p. 3) that APCo might suffer loss of outstanding ITC has no basis whatsoever in any IRS regulation or ruling that we are aware of. In the absence of some basis for APCo's alleged concern, it cannot be considered other than imaginary.

sincerely yours,

&//Lk . .

Biard MacGuineas

. .o cc: Benjamin H. Vogler Joseph P. Rutberg J. A. Bouknight, Jr.

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