ML20151B447

Requests Util Be Ordered to Distribute Bechtel Rept Re cost-benefit Analysis & ASLB Should Promptly Reopen Hearings on Continued Operation of Units

ML20151B447
Person / Time
Site:	Midland, 05000000
Issue date:	02/14/1980
From:	Cherry M CHERRY, M.M./CHERRY, FLYNN & KANTER
To:	Mark Miller, Smith I Atomic Safety and Licensing Board Panel
Shared Package
ML20150F172	List: ML20150F170 ML20150F806 ML20151B319 ML20151B324 ML20151B345 ML20151B447 ML20151C503 ML20151G694 ML20209B290 ML20209B331 ML20209B400 ML20209B407 ML20209B413 ML20209B419 ML20209B517 ML20210S413 ML20210S451 ML20210S469
References
FOIA-84-96 NUDOCS 8101290035
Download: ML20151B447 (3)

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I 2tebruary 14, 1980 Marshall E. Miller, Esq. ~

I Chairman MIDLAND Atomic Safety and Licensing OLMSTEAD/ /PATON Board Panel U.S. :.aclear Regulatory Commission FF Washington, D.C. 20555 Ivan W. Smith, Esq.

Chairman keej c uC Atomic Safety and Licensing Board U.S. Nuclear Regulatory Commission Washington, D.C. 20555 Re: Consumers Power Company (Midland Plant, Units 1 and 2)

Docket Nos. 50-320, 50-330 k Gentlemen:

I have received Ms. ibs' letter of February 8, 1980, on behalf of Consumers Power any, confirming that the commercial operation for bot!

and that the cost for the Mi ts will now extend into 1985

'S3 billion. nuclear units will exceed As we all know, in prior hearings (1976-1978) the I matter of the cost benefit analysis of continuing on with the i Consumers units was analyzed and the Board's then decision was i that the cost benefit analysis did not change sufficient to i

! warrant termination of one or both units. The facts at that time indicated that the plants would be on line in the 1981-82 period and that the <ost would be approximately $1.6 billion.

In addition, at that time, Dow Chemical Company indicated that while the economics of buying process steam from the nuclear units at $1.67 billion was close, it was not sufficient to tip the scale for Dow to pull out.

Things have now drastically changed. Consumers has announced that the cost wil: Le at least $3 billion and that the plants won't even be on 'ine by 1984, beyond which Dow has no obligation to continue under the most recent general agree-ment between Consumers and Dow dated June 1978 and forwarded nr -

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, O Marshall E. Miller, Esq.

Ivan W. Smith, Esq.

February 14, 1980 I

Page Two to all concerned under letter dated June 26, 1978. Indeed, since paragraph 9 of the general agreenent concerning termina-tion indicates that Dow may pull out when there is a clear prospective breach (and that is certainly clear here since Consumers has announced the plants will not be ready by the end of 1984), it would seem that there is a failure of Consumers to meet its obligation at this juncture.

We believe that the Nuclear Regulatory Commission should immediately reinvestigate the cost benefit analysis concerning the Consumers plants since it is not even clear that the 1984-85 deadline or the $3+ billion cost e stima t e will be the end of it. This is in part because any resolutions of the Three Mile Island debacle will have to be f actored into the Midland plants and we all know that no one yet knows what the final answers are (either physically or economically) from Three Mile Island. In addition, Dow Che.-ical has announced to the press that it is seriously reevaluating its nuclear venture with Consumers and is presently under the throes of a S22 million proposed fine from EPA for continuing to run its coal fired plants.

t Thus, since it is now clear that nuclear steam (if at all) can only come 1985 and thereafter, the present situation at Midland represents increased environmental costs resulting from outdated coal operations. Indeed, one would reason that Dow has to begin now with new facilities, in any event, in order to meet Clean Air Standards at the earliest possible time.

We will be preparing appropriate papers for re-investigation of whether the Midland plant should continue.

However, we believe that it is, in the first instance, the Regulatory Staff's and the Atomic Safety an/ 'scensing Board's obligation to monitor nuclear power develoMmer*., such as it is, without forcing intervenors always tr ;ar / the day.

For that reason, we submit this matter r , O Atomic Safety and Licensing Board (and by copy of this letter to the Nuclear Regulatory Staff) to see if one or both of those entities will take the initiative to investigate whether the Midland units, now characterized as economic folly at its worst, should continue. Indeed, not addressing this question at the earliest possible time could force Dow to continue to rely upon the nuclear option and thus in 1985 when the operation dates and costs have escalated, again Dow will have been forclosed from options, and the environ-( ment, always the environment, will be severely oppressed.

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.O . " . Marshall E. Miller, Esq.

- Ivan W. Smith, Esq.

February 14, 1980

[ Page Three Accordingly, we await prompt action by officials of the Commission in the absence of which we will initiate action ourselves.

One further point I was somewhat shocked by Ms.

Gibbs' February 8th letter since it did not forward Bechtel's report to Consumers. I was further shocked that I have not yet received a copy of the request from the Commission to Consumers to " fork over" that Bechtel report now, whether or not in the future Consumers chooses to take issue with it.

Indeed, one would reason that the Atomic Safety and Licensing Board panel would have already on its own motion requested that that report be filed and distributed to the parties.

We are in difficult energy times as we all know.

As a member of the American Bar Association Special Committee On Energy (presently doing a report for the Department of Energy), I know ir. some detail the chaotic picture of energy around the United States. Policy comes in fragnented forms frcm Washington and the state gcVernments, ill-equipped to deal with the emerging chaos, further create vacuumb into which no leadership seems to move. If the Nuclear Regulatory

( Commission and its component parts refuse to take prompt action when warranted, then no one will look to it for leadership. And certainly subsequent to the Kemeny and Rogovin Reports it is encumbant upon the Nuclear Regulatory Commission (and its component parts) to prove to the American public that the Commission, Atomic Safety and Licensing Boards, and the Regulatory Staff are interested in sound protecti of the American public and the surrounding environment and not just " business as usual".

I would hope the Board will take action on its own motion to order Consumers to distribute the Bechtel Report and then promptly reopen hearings as to whether the Midland nuclear units should continue.

I look forward to hearing from someone soon.

Very truly yours, I

A TTh L-Myrcn M. Cherry MMC /dn

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1 8005 200 8df FEB 151980 MEl10RANDUi1 FOR: . Harold R. Denton, Director Office of Nuclear Reactor Regulation

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FROM: R. J. Mattson, Director. -

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SUBJECT:

HEB EQUIPMENT QUALIFICATION EFFORT AND' PDTENTIAL. -

FOR LICENSING DELAYS . :W y.. _

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The attached memorandum from Bob Bosnak notes that"in spite of' oui '

appeals to the Navy and the OMB, we have not been able to obtain the assistance from NRL that we had counted on for our SQRT reviews of 13 pending OL. applications. The only remaining alternative appears to be a contract with a private firm. We are proceeding to issue a request for proposal as soon as possible. 1 I agree with Bosnak's conclusion that schedules for the SQRT reviews will be irrecoverably delayed by at least eight or nine months, and l that we cannot recommend issuance of an operations license for any- q plant until the dynamic equipraent evaluation is complete. i l

Original signed by Roger J. Mattson Roger J. Mattson Director. ,

. Division of Systems Safety i cc: E. Case D. Ross J. Knight R. Bosnak DISTRIBUTION: l entral File  !

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• FEB .11 1980 p-MEMORA UM FOR: R. Mattson, Director, DSS THRU: J. .P. Knight, Assistant Director for Engineering, DSS FROM: R. J. Bosank, Chief, Mechanical Engineering Branch, DSS

SUBJECT:

' ' . MEB EQUIPMENT QUALIFICATION EFFORT AND POTENTIAL,FOR LICENSING DELAYS

Background

The Seismic Qualification Review Team (SQRT) was' established by the MEB in 1974 to perform a hands-on audit of OL applicant's program used to qualify electrical and mechanical equipment for dynamic seismic input. ICSB/PSB personnel parti-cipate in the program to assure the proper electrical function of equipment when subject to seismic input. With the advent of dynamic inputs originating from safety relief discharge or LOCA blowdown into pressure suppression con-tainments and from other sources, the scope of the SQRT effort was expanded to include the qualification of electrical and mechanical equipment for the total dynamic environment expected during service.

The SQRT review at plant sites conducted by the staff team since its inception '

(all PWR plants and Hatch-2) has emphasized a r.eview of the equipment quali-fication performed by the applicant, most often single frequency / single axis methods, to determine by a review of the qualification and inspection of the installation whether the criteria in.IEEE 344-1975, R/G 1.100,1.92, and SRP 3.9.2 and 3.10 have been satisfied. Typically preparation for a site visit by SQRT has required approximately 4 man weeks, a site visit is 3-5 days for the 4 man team, post visit evaluation approximately 4 man weeks, for a total of approximately 12 man weeks per plant. Because of difficulties with plants such as Diablo Canyon, the lead Mark II plants (Zimmer, LaSalle and Shoreham) and the time expended to attempt to establish a generic qualification of GE NSSS equip-ment, plant visits had slipped by several months by late 1978. With the establishment of the interim organization the SQRT was especially hard hit and all staff effort was halted due to a lack of resources by mid May 1979. ,

The letter from the Office of Management and Budget (OMB) in mid June 1979 that D0D assist NRC resulted directed to the Department of Defense in our contacting the Naval Research Laboratoryrequesting (NRL) in July, reaching tenta-tive agreement with them on work scope, resource requirements and schedules in August and establishing an interagency agreement in September. MEB memo of November 28,1979 (attached) discusses the significant work accomplished by NRL, including meetings with applicants, architect engineers and NSSS vendors, g G O NO b

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prior to the receipt of the NRL letter of November 19 unilaterally terminating our interagency agreement. The November 19 letter came as a complete surprise to both the NRC and NRL staffs participating in the program. The MEB memo of November- 28, 1979 led to the request by Chairman Ahearne to the Office of Management and Budget on the basis of national priority to request reconsidera-tion by the Navy of its November 19 decision. Mr. Denton's letter of January 3,1980 (attached) also requested such reconsideration. On February 7, MEB was advised by Mr. Dan Gessaman of OMB that efforts to effect a reversal of the Navy's decision had been unsuccessful. Mr. Jesse Funches of Chairman Ahearne's staff was so advised on February 8,1980. y

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Current Status and Plans MEB started reviewing alternative sources of assistance in January 1980, both within the government and within ririvate industry. Because of the procedures .

and long lead times in awarding contracts to private firms, we intend to issue an RFP as soon as possible, but plan to continue checking agencies within government to determine the availability of competent resources to assist us.

The alternative of using existing staff personnel is not viable unless experi-enced persons now assigned to D0R and USI are completely released from all other responsibilities.

Impact on Licensing The NRL contract encompassed 13 plants (Zimmer, Shoreham, San Onofre, Summer, LaSalle, Watts Bar, Midland, Susquehanna, Fermi-2, Waterford 3, Farley 2 and Commanche Peak).

As previously discussed, work had commenced on several plants (Zimmer, LaSalle, Shoreham, Summer). Unfortunately such work will need to be repeated when a new cdntractor is selected.

It is our best estimate that as a result or' the NRL cancellation schedules for SQRT will have to be slipped by at least eight or nine months. ihistimeappears to be irrecoverable. An operating license cannot be recommended for any plant until the dynamic equipment evaluation is complete. Applicant milestones such as in situ tests will also be severely impacted, k

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. Bosnak, Chief i R.

Mechanical Engineering Branch Division of S," stems Safety

Enclosure:

MEB Memo - November 28, 1979 Denton Letter - January 3,1980 cc: D. Vassallo 0. Parr R. Satterfield S. Varga H. Brammer F. Rosa L. Rubenstein F. Cherny V. Moore

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J. Stolz S. Hou D. Ross ..

R. Baer J. Funches

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