ML18227D483
| ML18227D483 | |
| Person / Time | |
|---|---|
| Site: | Saint Lucie, Turkey Point  |
| Issue date: | 10/26/1977 |
| From: | Jablon R Florida Cities, Spiegel & McDiarmid |
| To: | Chilk S NRC/SECY |
| References | |
| Download: ML18227D483 (16) | |
Text
LAW OFFICES SPIEGEL 85 MCDIARMID 2600 VIRGINIAAVENUE. N. W.
WASHINGTON. D. C. 20037 TELEPHONE I202I 333.4300 GEORGE SPIEGEL PETER k. MATT ROBERT C. MCOIARMIO OANIEI. J, GUTTMAN SANDRA J. STREBEL OAVIO R. STRAUS ROBERT A. JABLON BONNIE S. BLAIR JAMES N. HORWOOO OAVIO A. 6IACALONE ALAN J. ROTH ROBERT HARLEY BEAR FRANCES E. FRANCIS October 26, 1977 DANIEL I. DAVIDSON JAMES CARL POLLOCk THOMAS N. MCHUGH, JR.
Samuel J. Chilk Secretary Nuclear Regulatory Commission Washington, D.C. 20555 Re: Florida Power & Li ht Com an (St.
Lucie Plant-, Units No. 1 & 2),
Docket Nos. 50-335A and 50-389A; Florida Power & Li ht Com an (Turkey Point Plant, Units No. 3 & 4),
Docket Nos. 50-250A a d 50-251A.
Dear Mr. Chilk:
Xn the motion filed yesterday on behalf of Florida Cities there were certain errors and omissions. I enclose a corrected copy of the motion and request that it be substituted.
E regret any inconvenience this may cause.
Respectfully submitted, Robert A. Jablon Attorney for the Ft. Pierce Utility Authority of the City of Ft. Pierce, the Gainesville-Alachua County Regional Electric Water and Sewer Utilities, the Lake Worth Utilities Commission, the Utilities Commission of the City of New Smyrna Beach, the Orlando'tilities Commission, the Sebring Utilities Commission, and the Cities of Alachua, Bartow, Ft. Meade, Key West, Mount Dora, Newberry, St. Cloud and Tallahassee, Florida, and the Florida Municipal Utilities Association RAJ: tb Enclosure cc: All parties to these proceedings
UNITED STATES OF A<&RICA BEFORE THE NUCLEAR REGULATORY COMMISSION In the Matter of:
Florida Power & Light Company, ) Docket Nos. 50-335A (St. Lucie Plant, Unit Nos. 1 & 2) ) 50<<389A
)
Florida Power & Light Company, ) Docket Nos. 50-250A (Turkey Point Plant, Unit Nos. 3 &4) ) 50-253 4
)
MOTION TO LODGE DOCUilTS Pursuant to Rules 2.701, 2.714, 2.730 and 2.206 of the Commission's Rules oz Practice and Procedure, the Ft. Pierce Utilities Authority of the City of Ft. Pierce, the Gainesville-Alachua County Regional Electric Water and Sewer Utilities, the Lake Worth Utilities Authority, the Utilities Commission of the City of New Smyrna Beach, the Orlando Utilities Commission, the Sebring Utilities Co~ission, and the Cities of Alachua, Bartow, ."t. Meade, Key West, Mount Dora, Newberry, St. Cloud and Tallahassee, Florida, and the Florida Municipal Utilities Associa.tion ("Cities" ), intervenors in the above-captioned proceedings, respectzully request that certain documents be permitted to be lodged with'he Commission and made-part of the decisional, record.
On behalf of this Motion, Cities state as follows:
At least since August 9, 1976, 1/ when they filed intervention 1/ In the context of the South Dade units (Florida Power & Liaht Comtian (South Dade Plant), Docket No. P-636-A), these factual allegations were raised ~
earlier (April 14, 1976), Relief was requested relating to these plants.
However, Florida Cities hoped for some sort of preliminary settlement discussions before seeking further formal Commission action. "Joint Petition of Florida Cities For Leave to Intervene and Request for Conference and Hearing," Docket No. P-636-A, pp'; 69-73. It was requested that this joint petition be filed in both Docket Nos.
P-636-A and 50-389A.
petitions, Florida Cities have x'aised issues of serious antitrust abuse by FP&L in the above dockets. in Docket No. 50-389A, a licensing boaxd has granted late intervention, but denied intervention in Docket Nos.
50-335A, 50-250A and 50-251A on grounds of want of authority. These rulings were affirmed by the Appeals Boards and are before the Commission on petitions for review. 1/ The fact is that sexious claims of .antitrust abuse of NRC licenses (or potential abuse of proposed NRC licenses) made well over a year ago still have not been addressed on their merits.
Florida Cities believe it would serve no useful puxpose to attempt to gene@ally supplement the x'ecord at this time to include a-detailing of continued'efusals to deal by FP&L.
However, on or about October 14, 1977, FP&L filed proposed wholesale rate taxiffs at the Federal Energy Regulatory Commission, which they are obligated to call to the attention o the Commission. The tariff states lj the Florida Cities do not cite the full procedural record. The petitions before Commission for review were filed in Docket No. 50-389A by FP&L on July 25, 1977, and in Docket Nos. 50-335A; et al. by Florida Cities on September 8, 1977.
The petition in Docket.'iso. 50-389A wee grented by Order, October 19, 1977.
as follows:
"Sale for Resale Florida Power & Light Total Requirements Company, FPC Electric Rata Schedule SR-2 Tariff, Original Volume No. 1, Fourth Revised AVAILABLE: Sheet No. 5.
To electric service presently being supp1ied ar point(s) op delivery for total power requirements ot electric utiXity systems for their own use or for resale. Such electric utility systems are Clay Electric Cooperative, Inc., Glades Electric Cooperative, Inc., Lee County Electric Cooperative, Inc.,
Okefenoke Rural Electric Membership Corporation, Peace River Electric Cooperative, Inc. and Suwannee Valley Electric Cooperative, Tnc. This schedule shall not apply as substitute or replacement nower to a enerati utilit s stem'for which interchan e power agreements are available or to which Sale for Resale Paztial Requirements Rate Schedules PR is app3.icabl'e." (Emphasis supplied).
"Sale for Resale Second Revised Sheet Total Requirements Ho. 7.
Rate Schedule PR AVAILABLE:
To electric service supplied to electric utility systems for their partial powe- requirements at any point o del'very to'complement the insufficient generatin ca acit and/or firm power urchases of sucn systems for their own use o" for resale. Such systems are Florida Keys Electric Cooperative Association, Inc., Utilities Commission of the City. of New Smyrna Beach, Florida, and the City of Starke, Flor'da. d.nis schedule shall not a nl as substitute or"ze lacement nower to a generati utilit s stem'for'hich full service'interchange power agreements are applicable," (Emphasis supplied).
Whatever the legality or acceptability of these proposed tariffs may be under the Federal Power Act, they conclusively show the follow'ng facts:
- 1) FP&L refuses to sell total requirements wholesale power to new customers.
s
- 2) FP&L refuses to sell wholesale power to systems having genera-tion except to replace "insufficient capacity;" and
- 3) FP&L will not permit a "full service interchange power agreement" for systems purchasing wholesale power.
These tariff changes would prevent the potential sale of
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wholesale electricity to nearly every municipal system in Florida.
For reasons stated in Cities'etitions to intervene, such refusals to deal plainly violate antitrust law and policy as well as historic service obligations. E.g., Otter Tail Power Co. v. United States, 410 U.S. 366 (1973) .
They. present immediate concerns with. regard to the responsibili.ties of the Nuclear Regulatory Commission. Under normal circumstances, it would be-presumed that a licensee or proposed li.censee of this Commission would at the very least disseminate the benefits of nuclear power through normal sales of electricity. See Atomic Energy Act, 53, 42 U.S.C. 52013. FP&L would deny such benefits to residents of municipal systems. Other documents demonstrate FP&L's policy is to sell firm power onl where it can sell at retail, plainly an act of monopolization as well as an unlawful tie-in sale.
FP&L is using the economic advantages from its licensed and proposed nuclear plants to retain and expand its retail service market.
Based upon its nuclear advantage, it actively seeks to take over the Vero Beach electric system, independent since 1922, and has suggested the sale of other systems. Yet by its FERC filing it would deny the sale o wholesale power, with the inevitable result of encouraging others to sell their systems as the only way to participate in nuclear benefits-.
This issue is not abstract. The ." t. Pierce Utilit"es Authority has requested to purchase wnolesale power at potentially great cost savings.
K FP&L refuses. Ft. Pierce, located ad]acent to Vero Beach, has had discussions with FP&L concerning FP&L's purchase of its system. >foreover, the intervenor group has specifically requested the right to purchase wholesale power as part of a settlement proposal (which includes other terms).
Apart from any other allegations, intervenors respectfully I
submit that this new refusal to deal in basic services mandates Commission action.
Additional docu'ments not previously available have come to light demonstrating FP&L's awareness that deprivation of nuclear availability to Florida Cities is hurtful to the Cities. In the context of Florida power
& Li ht Comtian , Federal Energy Regulatory Commission Docket Ho. E-9574, Plorida Power & Light Company, applicant here, has made available to staff and parties certain documents relating to that proceeding, some of which have been proposed as eWibits. The documents show motivation by FP&L to limit Florida Cities'ompetitive opportunities, including access to nuclear power.
Florida Cities believe that they have fully"supported a grant of intervention and hearing. They therezore request that the Commission review the proposed supplementary ev-'dence only if it were incl"'ned to deny intervention and hearing. They do believe that the abuse of tGC licenses and antitrust principles shown by these documents are so plain that the Commission must consider these documents and take ameliorative action as a result oz this evidence, even it it were inclined otherwise to rule against Florida Cities.
Florida Cities gave FP&L advance notice of this motion. Florida Cities were requested not to lodge the documents referred to with the motion.
Although Florida Cities know of no basis for FP&L's request, they rezrain from'lodging them, so's to allow time zor Commission ruling, but respectfully request that the Commission allow the document to be lodged and made part of the record. Scenic Hudson Preservation Conference v. FFC, 354 P.2d 608 (2d Cir. 1965), cert. den. sub nom. Consolidated Edison Company of Hew York v.
Scenic Hudson Preservation Conference, 384 U.S. 941 (1966).
Examples of such documents include:
Document /r'280954, et. sea. This document provides an April 8, 1976 summary of major financial considerations for FPL in the development oz cooperative nuclear power plants, showing anticompetitive intent. These considerations include the proposition that it would probably be best if FPL did not have any ownership interest in the plant. 1/
Document /3280958, et. sea. apparently prepared in July, 1976, in relation to an FPL management meeting on implications for FPL of recent developments in competit've relations. As stated at page 10 << 13~ FPL contemplated that a'shift to coal would eliminate the Atomic Energy Act as a route to municipals'nvestment in generation.
1/ The document should be read in conjunction with FP&L's contemporaneous i'farch 30, 1977 letter refusing Florida Cities'articipation in the proposed FP&L South Dade 'nuclear Unit, but stating FP&L "would consider being part of a j oin't venture to cons true" a nuclear fac" lity somewhere in the Central Florida area so as to be conveniently located zor potent"'al participants.
Such a oroject would be a true joint venture zrom its initial inception through completion and would require zull commitments of all participants commencing with the planning stages." Winy Cities 'considered such project in good faith, but FP&L ultimately requested public funds be. spent on the project wiKout its being willing to consider or. agree to discuss provision arrangements crucial to the economics of the unit, even including pr'ovision of nuclear fuel, transmission and back-up. Document //280954 indicates that from its inc ption, ."P&L recognized the jo.nt venture form of the proposal would make the project difficult to finance for the mun'cipals, but it-or proposed that form anyway, while resisting support for legislation to allow a joint agency.
thereby underscoring the major thrust of the document: that municipals should be prevented or limited from achieving practical access to nuclear generation. FP&L further designates the municipals-co-operative strategy to obtain statewide generation, planning, multiple-unit sharing, 'and full coordination. FPGL's response: FPL ma not be able to comaete if municipals and co-.operatives can gain access to generation investment with their low-cost capital. Municipals presently having franchises with FPL will be encouraged to go public, showing'its intent to limit competition.
Document !/242627, a February, 1974 memorandum indicating a desire to limit wheeling access to the proposed 500 Kv line (between Florida and Georgia) to systems fully regulated by the FPSC (Florida Public Service Commission), thereby preventing or limiting transmission access to mun'cipals.
Document i/254384, et. sea., relating to interconnection negotiations between FP6L and Homestead in 1973. These docume..ts reveal
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FPGL's desire to ozfset the demand for wh'eeling as well as avoid a long-term Firm Power commitment. (Document:r 270832) .
Document 8281505, et. sea., entitled S trategic Planning Depart ent, Policy Planning Background Paper, Strateg'c Issues in Inter-Utility Relations. Pages 13-14 of this document bear the headings Strategic Summary Interconnections Joint Ventures. It shows specific intent to avoid the sale of wholesale power, thereby restricting nuclear benefits. 1/
1/ As s tated above, FPGL has, zor example, most recently responded negatively to proposals to purchase wholesale power by the Ft. Pierce Utility Authority.
Document 8273006, a December 5, 1975 memorandum from FP&L Vice President E.L. Bivans to FP&L official K.'S. Buchanan. The memo egresses iver. Bivan's concern that proposed interconnections with Tampa Electric Company and Florida Power Corporation provide for wheeling power at 'universal postage stamp rates.'ocument f/212164, et. sea., entitled Guidelines for Power Generation from i~funicipal. Waste Systems . The principal value in FP&L's participation is said to include deter the competitive threat of municipal generation.
in prepared testimony filed on August 5, 1977, azter reviewing the above-ref erenced. documents, among .others, 'n.'Florida Power': &:Ei iit "Co;, FERC Docket No. E-9574, Dr.,Gordon Taylor, Chiez oz the Division of Economic E
Stud'es in the Ofzice of Policy Analysis oz .ERC, sub]ected FP&L s competitive practices to detailed analysis. Dr. Taylor summarized his conclusions as follows:
"1. FP&L has generally refused to sell firm oulk power to municipals; now FP&L does not outright refuse but rather makes it extremely difzicult for municipals to gain these types of services; FP&L has refused the request of Vero Beach to purchase firm bulk power.
- 2. FP&L has refused to wheel third party power and in fact has explicitly denied a request by the City of Vero Beach to obtain wheeling wnen the City wanted to bring power in zzom the Orlando Utilities Commission.
- 3. FP&L, although it says that it will wheel power, refuses it to file a general wheeling tariff thereby making extremely difficult, e~ensive, and time-consuming for any utility desiring wheeling to obtain sezvice. This type of anti-competitive conduct by FP&L increases the transfer costs of customers attempting to obtain transmission services and is as effective as an outright refusal to wheel.
- 4. FP&L has refused in general to grant access to its nuclear power plants. How FP&L finally is granting access to its fourth unit, St. Lucie II nuclear plant. FP&L,.however, is not offering an equitable share to New Smyrna Beach and Homestead, the only systems offered an ownership share of the several that applied.
- 5. FP&L has insisted on territorial agreements before entering into any kind of bulk power marketing arrangements. Such tying agreements or conditions on sales are an example of the exercise of market power.
- 6. FP&L has insisted on a thirty year franchise agreements to those municipalities which it serves at retail. The effect of such long term franchises is to foreclose the x'etail market to other potential competitors.
- 7. FP&L has attempted to force the municipals to maintain an inefficiently large amount of generating capacity by insisting on interchange agreements rather than willingly selling firm wholesale bulk power.
- 8. FP&L has discriminated between the REX Co-ops and the municipals with regard to selling firm wholesa' bulk power.
Although FP&L is selling firm wholesale bulk power to the co-ops it has resisted doing the same to municipals. FP&L is in the wholesale bulk power business, but discriminates between customers it is willing to serve. I interpret this to mean, that FP&L sees the potential competition from zuni-cipals to be mucn greater than from the RE" Co-ops in tne competition to serve at retail, In summary, I conclude that FP&L has engaged in a series oz anti-competitive acts demonstrating that it has market power and is willing to exercise it."
COh CLUS ION:
In view oz the passage of time and new evidence oz anti-competitive activities, Florida Cities request permission to supplement their petition to intervene: Specifically, they request that this motion be considered as part of the records 'n these cases and that they be allowed to file 1) the above-referred to documents, including correspondence concerning
the Central Florida unit, refusals to deal with Ft. Pierce, and possible settlement, and 2) the testimony of Dr. Gordon Taylor.
Respectf ully submitted, Robert A. Jablon Daniel Guttman Attorneys for the Ft. Pierce .Utility Authority of the City of Ft. Pierce, the Gainesville-Alachua County Regional Electric Mater and Sewer Utilities, the Lake North Utilities Commission, the Utilities Commission of the City of .Hew Smyrna Beach, the Orlando Utilities Commission, the Sebring Utilities Commission, and the Cities of Alachua, Bartow, Ft. iMeade, Key Vest, Mount Dora, Hewberry, St. Cloud and Tallahassee, Florida, and the Florida '.funicipal Utilities Associat.'on October 26, 1977 Law Offices of:
Spiegel & i~fcDiarmid 2600 Virginia Avenue, H.M.
Mashington, D.C. 20037 202-333-c4500
CERTIFICATE OF SERVICE I hereby certify that I have this day caused the foregoing document to be served upon the following persons:
BY HAND: William C. Wise, Esquire Linda L. Hodge, Esquire Robert Weinberg, Esquire Lowenstein, Newman, Reis Suite 200 & Axelrad 1019 - 19th Street, N.W. 1025 Connecticut Avenue, N.W.
Washington, D. C. 20036 Washington, D.C. 20036 William H. Chandler, Esquire BY HAND: Lee Scott Dewey, Esquire Chandler, O'Neal, Avera, Gray, 0 ffice o f Executive Legal D iree tor Lang & Stripling Nuclear Regulatory Commission P.O. Drawer 0 Washington, D.C. 20555 Gainesville, Florida 32601 Chief, Docketing and Service David A. Leckie, Esquire Section Antitrust Division 'ffice of the Secretary Department of Justice Nuclear Regulatory Commission 1101 Pennsylvania Avenue, N.W. Washington, D.C. 20555 Washington, D.C. 20530 Ivan W. Smith, Esquire Robert H. Gulp, Esquire Atomic Safety & Licensing Board Lowenstein, Newman, Reis Panel
& Axelrad Nuclear Regulatory Commission 1025 Connecticut Avenue, N.W. Washington, D.C. 20555 Washington, D.C. 20036 John M. Frysiak, Esquire Tracy Danese, Esquire Atomic Safety & Licensing Board Vice President, Public Affairs Panel Florida Power & Light Company Nuclear Regulatory Commission P.O. Box 013100 Washington, D.C. 20555 Miami, Florida 33101 Robert M. Lazo, Esquire John E. Mathews, Jr., Esquire Atomic Safety & Licensing Board Mathews, Osborne, Ehrlich, Panel McNatt, Gobelman & Cobb Nuclear Regulatory Commission 1500 American Heritage Life Bldg. Washington, D.C., 20555 Jacksonville, Florida 32202 Chief, Antitrust/Indemnity Group BY HAND: J.A. Bouknight, Jr., Esquire Office of Nuclear Reactor Regulation Lowenstein, Newman, Reis & Nuclear Regulatory Commission Axelrad Washington, D.C. 20555 1025 Connecticut Avenue, N.W.
Washington, D.C. 20036 Dated at Washington, D.C. this 26th day of October, 1977.
Robert A. Jablon&
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