Memorandum in reply to NRC proposed findings of fact ... · Proposed Findings and Conclusions and supporting Memorandum dated March 28, 1977, and in its April 27, 1977 Reply to the

* ~, ~~'K+.

UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION

In the Matter of

CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.

('Indian Point Station, Unit No. 2)

Docket No. 50-247 (Extension of Interim

Operation Period)

CON EDISON'S MEMORANDUM IN REPLY TO NRC REGULATORY STAFF'S PROPOSED FINDINGS OF FACT AND

CONCLUSIONS OF LAW AND SUPPORTING MEMORANDUM

- NOTICE THE ATTACHED FILES ARE OFFICIAL RECORDS OF THE DIVISION OF DOCUMENT CONTROL. THEY HAVE BEEN CHARGED TO YOU FOR A LIMITED TIME PERIOD AND MUST BE RETURNED TO THE RECORDS FACILITY BRANCH 016. PLEASE DO NOT SEND DOCUMENTS CHARGED OUT THROUGH THE MAIL. REMOVAL OF ANY PAGE(S) FROM DOCUMENT FOR REPRODUCTION MUST BE REFERRED TO FILE PERSONNEL.

'Regulatory Docket hie DEADLINE RETURN DATE

RECORDS FACILITY BRANCH

:4,~ A 19,77

L ,

8111120241 0504 PDR ADOICK 05000247 G PDR

Leonard M. Trosten Eugene R. Fidell M. Reamy Ancarrow LeBOEUF, LAMB, LEIBY & MacRAE

1757 N Street, N.W. Washington, D.C. 20036 (202) 457-7500

Edward J. Sack Joyce P. Davis Consolidated Edison Company

of New York, Inc. 4 Irving Place

New York, New York 10003

Attorneys for Consolidated Edison Company of New York, Inc.

TABLE OF CONTENTS

Page

INTRODUCTION....................

ARPGUMENT ................... ..... 3

I. The Regulatory Staff, like HRFA, has sought, in essence, to compel Con Edison to show in this case that the closed-cycle cooling condition should be vacated . . . . 3

Ii. The Regulatory Staff has misconstrued the License by attempting to award different weights to evidence based, on the one hand, on plant operations and, on the other hand, other empirical data obtained and analytical tools developed since the Indian Point 2 operating-license hearing record was closed .......... 28

III. The Regulatory Staff has repudiated the testimony of its own chief biological witness that numerous portions of the Ecological Study Program require independent Staff assessment or reassessment . . . . 39

IV. The Regulatory Staff's use of the Indian Point 3 Final Environmental Statement and Commission decision represents a misinterpretation of the history of that case, a distortion of the Indian Point 3 stipulation, an abandonment of the Staff's own pr ior representations to the Commission, and, if adopted, a denial of Con Edison's right to an adjudicatory hearing........44

V. The Regulatory Staff has, if anything, confirmed that its so-called Benefit-Cost Analysis was a mere post hoc rationalization that cannot be credited.........54

CONCLUSION......................72

CITATIONS

CASES

Arkansas Power & Light Co. (Arkansas Nuclear One Unit 2), ALAB-94, 6 AEC 25 (1973).......

Consolidated Edison Co. of New York, Inc. (Indian Point Station, Unit No. 2), ALAB-188, 7 AEC 323 (1974) . . . . . ... . ....... .. ......

Consolidated Edison Co. of New York, Inc. (Indian Point Station, Unit No. 2), ALAB-198, 7 AEC 475 (1974) .... ........... .......

Consolidated Edison Co. of New York, Inc. (Indian Point Station, Unit No. 3), ALAB-287, 2 NRC 379 (1975) ....... ...................

Consolidated Edison Co. of New York, Inc. (Indian Point Station, Unit No. 3), CLI-75-14, 2 NRC 835 (1975) ....... ...................

Home Building and Loan Association v. Blaisdell, 290 U.S. 398 (1934) ..... ..............

Houston Lighting and Power Co. (South Texas Project, Unit Nos. 1 and 2), ALAB-381, 5 NRC (1977) ...... ................

New England Power Co. (NEP Units 1 and 2) and Public Service Co. of New Hampshire, Inc. (Seabrook Station, Units 1 and 2), ALAB-390, 5 NRC (1977) ...... ................

Niagara Mohawk Power Corp. (Nine Mile Point, Unit No. 2), CLI-73-28, 6 AEC 995 (1973) .......

* . . 49, 50

* . . passim

* . . 56

* . . 48

28

• . . 28

• -• 10

. . . 48, 53

Public Service Co. of New Hampshire, Inc. (Seabrook Station, Units 1 and 2), CLI-77- , 5 NRC (1977)..... ........ ............... . .

Smith v. Allwright, 321 U.S. 649 (1944) ..........

37, 51

45

Vermont Yankee Nuclear Power Corp. (Vermont Yankee Nuclear Power Station), Public Service Electric & Gas Co. (Salem Nuclear Generating Station, Units 1 and 2), Philadelphia Electric Co. (Peach Bottom Atomic Power Station, Units 2 and 3), Metropolitan Edison Co. (Three Mile Island Nuclear Station, Units 1 and 2), Duquesne Light Co. (Beaver

- ii -

Page

g • O

Page

Valley Power Station, Units 1 and 2), Philadelphia Electric Co. (Limerick Generating Station, Units 1 and 2), Public Service Electric and Gas Co. (Hope Creek Generating Station, Units 1 and 2), Pennsylvania Power and Light Co. (Susquehanna Steam Electric Station, Units 1 and 2), Union Electric Co. (Callaway Plant, Units 1 and 2), CLI-76-18, 4 NRC 470 (1976) . . . .53

Virginia Petroleum Jobbers Association v. FPC, 259 F.2d 921 (D.C. Cir. 1958) ........... ..... 9,10

STATUTES

Federal Water Pollution Control Act, 33 U.S.C. SS 1251 et seq. (Supp.V 1975) ... ..........

National Environmental Policy Act of 1969, 42 U.S.C. §S 4321 et seq. (1970 & Supp. V 1975)......

"12

- 64

REGULATIONS

10 C.F.R. § 2.102(a) (1977)

10 C.F.R. § 2.754(b) (1977)

10 C.F.R. § 2.759 (1977) . .

10 C.F.R. S 50.90 (1977) . .

10 C.F.R. Part 51 (1977) . .

...... .............. 33

S. . . . . . .... . . .. 1

..... .............. 44

..... .............. 56

. . . . .. .. . . . .. . 8

MISCELLANEOUS

Consolidated Edison Co. of New York, Inc. (Indian Point Station, Unit No. 2), Dkt. No. 50-247, Final Environmental Statement (1972) .... ............ 36

Consolidated Edison Co. of New York, Inc. (Indian Point Station, Unit No. 2), Facility Operating License No. DPR-26 (1971) ....... ................. .passim

- iii -

Page

Consolidated Edison Co. of New York, Inc. (Indian Point Station Unit No. 2), Dkt. No. 50-247, Draft Environmental Statement, NUREG-0080 (1976)........................42,43

Consolidated Edison Co. of New York, Inc. (Indian Point Station, Unit No, 2), Dkt. No. 50-247, Final Environmental Statement, NUREG-0130 (1976) . . . . .42,43

Consolidated Edison Co. of New York, Inc. (Indian Point Station, Unit No. 3), Dkt. No. 50-286, Final Environmental Statement, NUREG-75/002 (1975) . . . . passim

M4atthew 7:7. ............... ....... ..... ....... 8

Oxford English Dictionary (Compact Ed. 1971) ....... 50

Water Resources Council, Principles and Standards for Planning Water and Related Land Resources, 38 Fed. Reg. 24778 (1973).............. .58

- iv -

INTRODUCTION

On April 22, 1977, the Regulatory Staff of the

Nuclear Regulatory Commission ("the Commission") submitted

Proposed Findings of Fact and Conclusions of Law in the Form

of an Initial Decision ("Staff Proposed Findings and Conclu

sions") and a Memorandum in Support of Proposed Findings of

Fact and Conclusions of Law ("Staff Memorandum in Support").

In accordance with § 2.754(b), 10 C.F.R. § 2.754(b) (1977),

and the Order of the Atomic Safety and Licensing Board ("the

Board") in this proceeding dated April 19, 1977, Consolidated

Edison Company of New York, Inc. ("Con Edison") submits its

Reply to the documents filed by the Regulatory Staff.

Con Edison has already stated its case in its own

Proposed Findings and Conclusions and supporting Memorandum

dated March 28, 1977, and in its April 27, 1977 Reply to the

Proposed Findings and Conclusions and supporting Memorandum

filed by the Hudson River Fishermen's Association ("HRFA")

on April 14, 1977. Accordingly, a number of the points made

by the Regulatory Staff do not require further comment from

Con Edison at this time. Still, the Regulatory Staff's

submittals in numerous respects are so far off the mark,

and/or represent previously unanticipated changes of posi

tion, that it is important that these matters be identified.

The Regulatory Staff, as was the case with HRFA,

has mistaken the issue before this Board--whether the

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interim operation period should be extended to May 1,

1981--for the question posed by Con Edison's March 15, 1977

application to vacate the cooling system condition in the

Indian Point 2 License ("the License"). The Regulatory

Staff also has in effect asked the Board to impose a higher

burden of proof on Con Edison than that contemplated by the

License and the Commission's Rules of Practice; unlike HRFA,

however, the Staff seeks to achieve this through a cramped,

sophistical and unfounded reading of the License condition.

Further, the Staff has inexplicably repudiated the testimony

of its own biological witness that new data and analyses re

quiring independent assessment or reassessment had already

been submitted by Con Edison. Other errors that the Regu

latory Staff has committed--and which the Board would commit

by adopting the Staff's Proposed Findings and Conclusions-

will also be noted.

THE REGULATORY STAFF, LIKE HRFA, *HAS SOUGHT, IN ESSENCE, TO COMPEL CON EDISON

TO SHOW IN THIS CASE THAT THE CLOSED.CYCLE COOLING CONDITION SHOULD BE VACATED

A.

By a variety of means, the Regulatory Staff has,

in this limited proceeding on Con Edison's request for an

extension of the interim operation period at Indian Point 2,

endeavored to require Con Edison to prove the case it will

eventually have to make in support of the March 15, 1977

application to vacate the cooling system condition of the

License. One way the Staff pursues this goal is by its

insistence, in the benefit-cost analysis, that the value of

the impact of Indian Point 2 operation with once-through

cooling must equal or exceed the cost of a cooling tower,

since the effect of this equation is to place an inordinate

cost on the scales.1

1/ Staff Proposed Findings and Conclusions at 48; but see Con Edison's Memorandum in Support of Proposed Findings of Fact and Conclusions of Law ("Con Edison's Memorandum in Support") at 26-29. The Staff has claimed that its position that the cooling question has been determined does not mean that Con Edison is "automatically" precluded from obtaining the relief here requested, but only that this circumstance "enters into the determination of whether the relief should be granted." Staff Memorandum in Support at 15 n.35. In a proceeding where so much attention has been paid to the theoreti

(Footnote continued)

-4-

.IThe Regulatory Staff's presentation most directly

on point is its claim that "the evidence must show more than

the availability of'substantial amounts of new data which

might lead to a change in the cool Iing tower requirement."-V

This is stated as an argument heading on page 5 of the

Memorandum in Support, but the text on that page shows the

Staff's position to be that it is merely "reasonable to

assume that some standard of review of the data which is

more rigorous than that proposed by Con Edison was intended."13/

The Staff finds this assumption reasonable on the basis of

an asserted rejection by-the Appeal Board of an extension of

1/ Footnote continued

cal underpinnings of benefit-cost analyses, Con Edison is at a loss to understand how a consideration such as this "enters into" the decisional process. We believe that this is only an effort to pass off the merits question in the guise of just another "factor", cf. Tr. 750, to stir into the benefit-cost analysis in tHie present limited proceeding. See also p. 46, n.6 infra.

2/ Staff Memorandum in Support at 5.

3/ Con Edison has indicated that the proper test to be applied to the sufficiency of the data and analyses in this case is whether "[tihe results of Con Edison's Ecological Study Program merit independent review by the Commission and hold forth the possibility of. demonstrating by a preponderance of the evidence that closed-cycle cooling at Indian Point 2 is unnecessary," Con Edison's Memorandum in Support at 1-2 (footnote omitted) , or whether there is "a substantial possibility that after evaluation of the results of Con Edison's Ecological Study Program the Commission might conclude, on the basis of a benefit-cost analysis, that closedcycle cooling should not be required for Indian Point 2." Con Edison's Proposed Findings and Conclusions at 14.

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interim operation until May 1, 1981. Unfortunately, this

premise is false, since the Appeal Board was not asked by

Con Edison to insert a "reasonable termination date" of May

1, 1981 in the License; rather, Con Edison had asked that

the date be September 1, 1981. As we have pointed out

elsewhere,-/ the difference in the two dates accounts for an

entire striped bass spawning season--an error of no small

consequence, since the present proceeding is itself con

cerned with continued operation over only one spawning

season.

Proceeding, nevertheless, from this unfounded pro

position, the Regulatory Staff has laid out a complicated

obstacle course that Con Edison must complete before the

benefits and costs of the proposed extension can even be

addressed. Most of the Staff's obstacle course is inappro

priate to this limited proceeding.

The first test is that the "conclusions based on

the data, on their face, appear to demonstrate a probability

that once-through cooling will be acceptable."-/ The Staff

goes on to assert that "[i]f these conclusions are not

sufficient, in the absence of any independent evaluation

whatsoever, to demonstrate that probability, then they

4/ Con Edison's Reply to HRFA at 46-48.


-6-

certainly do not justify an extension.".' If the Regulatory

Staff's intent, with this first hurdle, is simply to test

whether the unexamined conclusions of the Ecological Study

Program point to a marked reduction in plant impact on the

striped bass such that the costs of a closed-cycle cooling

system would be less than the benefits of such a system,

then surely the test has been met in this case.- The Staff

does not appear to question Con Edison's success in over

coming this hurdle.

Second, the Regulatory Staff claims that if the

parties, "without thorough independent review of the raw

data, . . . are able to sufficiently indict the conclusions

so that their credibility is undermined to the point that

they no longer demonstrate a probability that once-through

cooling will be acceptable, then these data do not justify

an extension of interim operation."'8/ This Staff-designed

hurdle truly confuses the issues in the present proceeding

6/ Id.

7/ See, e.g., Con Edison's Proposed Findings and Conclusions at 24 et seq. (summarizing areas of new information, including evidence that entrainment mortality is less than 100%, that the f, f and f factors are less than previously though, that compensatory mechanisms operate in the Hudson River striped bass fishery, that the Hudson River is not as great a contributor to the Atlantic coastal striped bass fishery as previously thought, and that a stocking program for hatchery-reared striped bass could be useful in offsetting power plant impacts).

8/ Staff Memorandum in Support at 6-7.

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with those in the proceeding on the March 15, 1977 applica

tion. For this reason Con Edison submits that it represents

an inappropriate standard which the Board should reject.

However, even if the Board imposes this excessive burden on

Con Edison, the record of this proceeding supports a finding

that this test, couched by the Staff in terms more suitable

to a criminal trial than to an administrative hearing on

environmental issues, has clearly been met. Perhaps the

best evidence that even this unduly onerous test has been

met may be found in the testimony of Dr. Webster Van Winkle,

the Staff's biological consultant and witness, who listed

for the Board a number of areas where, based upon his

review, Con Edison's Ecological Study Program had produced

results that merited independent Staff assessment or reassess

ment,2 / and which could lead to a change in his opinion on

key issues related to the need for closed-cycle cooling.-0

Third, the Staff has set up at this late date a

standard that Con Edison's data must "admit of and expedite

9/ See PP.40-42- infra; Supplemental Testimony of NRC Staff in Response to Board Comments on Aquatic Impact Analysis, Dr. Webster Van Winkle ("Van Winkle"), following Tr. 1069, at 4-5; Testimony of NRC Staff on Relative Benefits and Costs Associated with Applicant's Request for Extension of Operation with Once-Through Cooling at Indian Point Unit No. 2, Dr. Robert L. Spore and Dr. Webster Van Winkle ("Spore & Van Winkle"), following Tr. 1076, at 15-16; see Con Edison's Proposed Findings and Conclusions at 28, 33, 34, 39, 40, 48, 55.

10/ See Con Edison's Proposed Findings and Conclusions at 55; Tr. 896.

-8-

full and prompt independent review." This criterion is

discussed in Part II of this Reply, infra, but we will

simply note at this point that this hurdle--nowhere referred

to in the License or Environmental Technical Specification

Requirements, nowhere referred to in ALAB-188I -/ or the

Commission's Indian Point 3 decision 1 2/ on which the Staff

places such great reliance, nowhere referred to in the

Commission's environmental regulations,1-/ and not the

subject of any generic request by the Staff throughout the

period of litigation over cooling systems at Indian Point-

must not distract the Board from its proper inquiry. The

record of this proceeding shows that the Staff has received

considerable amounts of information from Con Edison's

Ecological Study Program literally for years without ever

having complained, prior to isolated testimony in this case,

that the form or content of the data were such as to impede

the Staff's analysis. Con Edison stands ready to answer the

Staff's questions on the results of the Study Program, but

the Staff must come forward with those questions, 1 4/ and

not lie in wait only to ambush Con Edison for past submittals

11/ Consolidated Edison Co. of New York, Inc. (Indian Point Station, Unit No. 2), ALAB-188, 7 AEC 323 (1974).

12/ Consolidated Edison Co. of New York, Inc. (Indian Point Station, Unit No. 3), CLI-75-14, 2 NRC 835 (1975).

13/ 10 C.F.R. Part 51 (1977).

14/ Matthew 7:7.

-9-

that allegedly failed to meet data requirements that could

be known only by telepathy or clairvoyance.15/

Not content with setting up three hurdles for Con

Edison to overcome, the Regulatory Staff would also indirect

ly hold the Company to the standards applicable with respect

to judicial stays. 1-6/ Thus, the Staff coyly notes that it

does not argue for the direct application of the Virginia Petroleum Jobbers criteria to this case, but instead argues by analogy that the Staff's proposed minimum tests of probability of success on the ultimate question are more than justified in light of the more rigorous criteria which govern relief in the closely analogous circumstances of a stay pending further review or rehearing.17/

Con Edison's view is that the record before the Board would

support a finding that, balancing all the Virginia Petroleum

Jobbers criteria,18/ it would meet the standard set in that

15/ Applicants for facility license amendments, no less than applicants for initial licenses, "are entitled to know both what they must undertake to do in connection with their applications and against what criteria the acceptability of their proposal will be measured." New England Power Co. (NEP Units 1 and 2) and Public Service Co. of New Hampshire, Inc. (Seabrook Station, Units 1 and 2), ALAB-390, 5 NRC (1977) (opinion of Chairman Rosenthal and Drs. Buck and Johnson), slip op. at 20.

16/ See Staff Memorandum in Support at 7-8.

17/ Id.; see generally Virginia Petroleum Jobbers Ass'n v. FPC, 259 F.2d 921 (D.C. Cir. 1958).

18/ Though all the criteria were listed in a footnote by the Regulatory Staff, it is evident that only the first-probability of success on the merits--is of interest from the Staff's point of view. This has the effect of denying any weight to such traditional and highly


-10-

case. But Virginia Petroleum Jobbers has no application

here, as the Staff has properly noted. Since the case has

no bearing on the instant proceeding, it is of no moment

that.the Staff's proposed criteria for this case are less

onerous, as if the Staff were making some charitable gesture.

These multifarious obstacles the Staff would erect

are, with the exception of the first criterion, inappro

priate to the issue now before the Board. Where, as here,

the question is not whether the fundamental character of the

license condition should be altered, but rather whether

"there is sufficient reason to look further into the matter,"

the Board should be loath to take or require any action that

exposes a licensee to potentially needless expenditures.

Because it is evident that there are substantial issues of

fact to be tried on the merits of the cooling system question,

denial of the June 6, 1975 application would be error.

B.

In its Proposed Findings and Conclusions, the


pertinent concerns as the public interest, and the potential injury to the parties if the proposed action is approved or denied. Thus, the Staff has used this ostensible "analogy" in a highly selective fashion that distorts the decisional process the case contemplates.

19/ Houston Lighting and Power Co. (South Texas Project, Unit Nos. 1 and 2), ALAB-381, 5 NRC (1977), slip op. at 12-13, n.8.

-11-

Regulatory Staff has presented a highly tendentious summary

of its views of the Con Edison Ecological Study Program.

These proposed findings run from page 25 to page 43, and it

is obvious that they go far beyond the level of detail that

is relevant or appropriate to this limited proceeding--the

purpose of which is to determine whether a plenary hearing

on the results of the Ecological Study Program is warranted.

This was the guiding theme which the Board set for the

hearing in this case,- / and it should be adhered to. As

the detailed matters go beyond the issue before the Board,

findings on them are not necessary. Moreover, findings on

these points would be in derogation of the parties' rights

to a full adjudicatory hearing on the merits of the cooling

system question. For this reason we believe that any find

ings in this limited proceeding would not be entitled to res

judicata or collateral estoppel effect. Nevertheless,

because of the danger that such treatment might be afforded

to the Initial Decision in this case, even though the issues

and the depth and scope of the examination were narrowly

confined,- 1/ the Board should eschew detailed findings of

thesort requested by the Regulatory Staff. The Board

should make clear that none of its determinations in this

20/ See, e..., Tr. 66-67, 906, 912, 1262-63, 1462-63.

21/ E.g., Tr. 906, 912.

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proceeding will have binding e'ffect in the subsequent

proceeding occasioned by Con Edison's March 15, 1977 license

amendment application.

For the record, however, Con Edison objects to

many of the findings and conclusions proffered by the

Regulatory Staff, and will note at least some of the major

areas of disagreement in the following paragraphs.

First, a general. comment is in order. Proposed

findings and conclusions are, to be sure, an advocate's

document. Nevertheless, they are intended to be, in our

understanding, an aid to the Licensing Board in the prepa

ration of an Initial Decision. In important respects, both

of substance and of tone, this purpose seems to have poorly

served by the Staff's submittal of April 22.

With regard to tone, we can only observe that the

provocation of needless acrimony is not in keeping with the

highest traditions of the Staff, and cannot advance the

Commission's purposes. Con Edison questions, for example,

the Regulatory Staff's compulsion to precede a neutral term

such as "larval tables" with the contemptuous modifier "so

called". 22/ Another instance may be seen in the Regulatory

Staff's attempt to cast doubt on Con Edison's contribution

data by describing the innate tag sampling method as only

22/ Staff Proposed Findings and Conclusions at 26.

-13-

going so far as "necessary to fill a quota".23/ The Staff

failed to explain, as one might have hoped, that in this

context "quota" referred not to a bare minimum, but to the

statistical quantity derived, in advance of sampling, from a 24/

carefully formulated sample design.-

Impact Assessment - The Regulatory Staff's attempt

to impeach Con Edison's entrainment mortality data is un

successful. At the hearing, witnesses for Con Edison

explained that no compairsons between larval table and net

mortality data had been conducted because larval table data,

for a number of reasons, 2-/ had not been obtained for Indian

Point.

The Regulatory Staff refers to the "limitations"

of Con Edison's net mortality correction data, although

23/ Id. at 40.

24/ Tr. 401.

25/ Larval table data had not been collected at Indian Point prior to 1977 because use of larval table technique was viewed as being in an early stage of the art, Tr. 646, and further was not deemed essential at Indian Point, where discharge velocity is substantially lower than velocities at Bowline and Roseton. In addition, despite the Regulatory Staff's insinuations to the contrary, see pp. 31-32, Con Edison's research resources are not unlimited, and Con Edison was already required by its Environmental Technical Specification Requirements to use another collection method, i.e., nets. Tr. 645. Although the Regulatory Staff attempts to obscure this point by expressing its "receptiveness" to requests for technical specification modifications, its delay in processing other such applications, see p. 36, n. 20, infra, undermines this argument.

-14-

declining to provide the Board or parties with any citation

in the record.2 6 Even assuming arguendo that such "limita

tions" might exist, Con Edison notes that the f factors

used by Con Edison for purposes of this proceeding were

derived from those used by the Staff in the Indian Point 3

FES, and that the new correction data merely provide new and

more realistic values, particularly with regard to the

critical post-yolk sac larval stage, which indicate that the

impacts are lower than those values actually used by Con

Edison.--/ These new results, which will be subject to full

examination in the proceeding for Con Edison's March 15

application, therefore constitute significant new'data

requiring reassessment of the need for closed-cycle cooling.

Although the Regulatory Staff claims to have

independently analyzed Con Edison's f1 and f2 factors in the

Indian Point 3 proceeding, Con Edison emphasizes that in

that case this analysis was based upon only the 1973 data

available at that time. Since that time, the two additional

years of important data have been obtained. Hence the

Regulatory Staff's reliance upon an analysis which does not

include recent data should be discounted.

The Regulatory Staff's innuendo that Con Edison's

1974 and 1975 sampling techniques, "[d]espite previous


27/ See Campbell, Lawler, Marcellus, May & McFadden at 28-34.

-15-

criticisms''28 / nevertheless involved certain sampling

differences, suggests that these data were collected after

such "criticism" was rendered. In fact theRegulatory

Staff's ambiguous statement is merely referring to state

ments made at the hearing in this case. In any event, the

Regulatory Staff has offered no evidence that such differences

will distort conclusions, but only asserts that they "may"

do so. In view of the fact that further reliability study,

as warranted, will confirm these data, 29/ the Regulatory

Staff has shown nothing which would detract from the use

fulenss of this data for the purposes of this limited

proceeding.

In addressing Con Edison's latent mortality

material, the Regulatory Staff implies that Con Edison

blithely relied only upon 72-hour tests. In fact, although

Witness Dr. O'Conner firmly stated that this time-span is

appropriate for testing purposes, he emphasized that "(t]he

96-hour period was not dropped"'0/ but merely failed to

provide results that were significant.3 1/

In addressing more generally Con Edison's impact

assessment, the Regulatory Staff cited its witness's state


29/ Tr. 649.

30/ Tr. 632.

31/ Id.

-16-

ment that it would be difficult to assess plant impact at

population reduction levels of less than 50%. However, this

assertion, rather than being grounded in any scientific

analysis, was expressed as the witness "sort of intuitive

feeling".132/ Con Edison, on the other hand, has conducted

latent root multiple lineal regressions which have statis

tically assessed 79% of the variation in the fish population

as resulting from natural factors.33/

Although the Regulatory Staff attempts to list a

few difficulties with Con Edison's correlation analysis,

such difficulties are apparently more imagined than real.

The citation which the Regulatory Staff gives for the

proposition that "the selection of independent variables

has a dramatic effect on the results one gets" simply does

not support that statement. The observation that the

"sampling methods" (it is assumed that what is intended

here is collection methods) utilized to determine juvenile

abudance varied over the collection period fails to also

mention Dr. Campbell's detailed discussion of the follow-up

tests conducted to test for biases resulting from this 35/

variance.- The assertion that the margin of error caused

32/ Tr. 1020.

33/ Tr. 304-05; Campbell, Lawler, Marcellus, May & McFadden at 13-14.


35/ Tr. 299-302.

-17-

by extrapolating from a 15-mile stretch to total river

abundance is unknown casts aside Dr. McFadden's express

testimony that comparison of the 15-mile index with the

index based on a broader reach of the river in other years

36/ can show the validity of the 15-mile index,!- as well as

Dr. Campbell's testimony that there exists a significant

positive correlation between the 15-mile results and

riverwide results.37/

Compensation - The Regulatory Staff states that

"the various models utilized for impact assessment by Con

Edison all employ a compensation function which tends to

make estimates of percent reduction relatively insensitive

to other impact parameters. '"--/ This discussion stops

short, failing to note witness Dr. John P. Lawler's ex

planation at the hearing "that the model is relatively

insensitive to other parameters when ';ompensation is

operative, which you should expect, because that's what

compensation is all about. It says it will offset the

changes that are imposed on the system."3 9- / Dr. Lawler

further commented that when compensation is not operative,

36/ Tr. 429.

37/ Tr. 433.


39/ Tr. 274.

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the system is fairly sensitive to the other impact para

40/ meters.

The Regulatory Staff says at page 33 of its

Proposed Findings, "[tihe Staff has criticized the compensa

tion function used in the LMS Hudson River striped bass

models, pointing out the lack of a sound biological basis

for the left limb of the function and the lack of a relation

ship between any of the three parameters in the LMS compensa

tion function and measurable biological phenomenon," referenc

ing Staff Exhibit OT-2. In view of the limited significance of Staff Exhibit OT-2 in this proceeding,41- / this Exhibit

cannot support a finding on the merits of Con Edison's use 42/

of compensation.

The Regulatory Staff cites its witness Dr. Van

Winkle for the proposition "that at most the empirical

data represents a! 3uggestion that compensation has been

or is occurring in the Hudson River striped bass popula

tions." 43/ However, Dr. Van Winkle also indicated a

significant interest in examining information to be

presented in the January 1977 report-4/ and stated that

compensation in the Hudson River striped bass population

40/ Tr. 1245-46.

41/ Tr. 1081.

42/ See p. 48 n.6 infra.


44/ Tr. 925.

-19-

was an area where an independent assessment appears

essential in regard to the question of the need for closed45/imliganefoa cycle cooling at Indian Point 3,- implying a need for a

careful review of Con Edison's new data which demonstrate

that compensationis operative in the Hudson River striped

bass population.

The Regulatory Staff draws attention to the uti

lization of commercial fishery data from 1955-75 to calculate

a Ricker stock-recruitment curve, pointing out inherent

biases within the data, which allegedly severely limit

its value in demonstrating compensatory responses in the

Hudson River striped bass population.4 6- / The Staff failed,

however, to acknowledge Dr. McFadden's discussion of the

commercial fishery data in .which he pointed out

The value of the long records typically outweighs the limitations and flaws in the data, and it has been a common experience in fishery science that, with appropriate interpretation and correction of the data, it's possible to make very important use of these types data in management of fish stocks.47/

Dr. McFadden further stated

The reason for wanting to emphasize this is, some of the most important long series of data relating to our assessment of qualified impact on the Hudson River

45/ Van Winkle at 4; Spore & Van Winkle at 15-16; Tr. 1274

75, 1328.


47/ Tr. 699.

-20-

stock are of this long-term series type. And the problems that are encountered in the Hudson, in my opinion, are no different generally speaking, and no more severe, than those commonly encountered in data of this type in their use in fishery science.48/

The Regulatory Staff asserts that the other

indicators of compensation, i.e., density dependent growth,

negative correlation between striped bass juvenile abundance

and adult bluefish abundance, and bluefish predation cannot

do more than indicate a possibility that compensation

operates in the population. This is an undisputed proposi

tion. The Regulatory Staff next asserts that the possi

bility of compensation was reflected in the impact analysis

for the Indian Point 3 FES. 4 9/ As noted elsewhere in this

Reply,-- / Con Edison considers that FES to be of no pro

bative value in assessing the importance of Con Edison's

new ecological data. Furthermore, the use of compensation

in that FES was extremely limited. 51/

The Regulatory Staff opines that a "negative

correlation between the bluefish population and the

striped bass population size does not, of course, neces

sarily reflect a casual link." -- / As Con Edison has dis

48/ Id.


50/ See pp. 44-53 infra.

51/ Tr. 1246.


-21-

cussed in its Memorandum in Reply to HRFA's Proposed

Findings and Conclusions, Con Edison has not based its

conclusions on bluefish predation upon this correlation

alone, but viewed it in conjunction with additional

tests revealing the existence of striped bass in stomachs

of bluefish.5 3/

The Regulatory Staff's criticism of Con Edison's

density-dependent growth data as utilizing an "absolute

measure of growth"5 4/ does not include witness Dr. K. Perry

Campbell's statement at the hearing that "we have looked

at all three methods of analyzing growth, the incremental

growth, relative growth and instantaneous growth rates

versus density. The same relationship appears with all

three methods."

the Regulatory Staff's confused effort to mitigate

the importance of Con Edison's monthly catch/unit effort56/

fails in two respects. Use of the term "fisheries data"

implies commercial fishery data, when in fact Con Edison

used research study seine catch effort data. Hence the

statement that "actual effort varies more than measured

effort"- / is not applciable to the monthly catch/effort

53/ Con Edison's Reply to HRFA at 28-29.


55/ Tr. 324-25.


57/ Id.

-22-

data, since the citation supporting that proposition refers

to the commercial fishery context, not the seine catch/

effort data. In fact, there is necessarily a 1:1 corres

pondence between measured effort (i.e., the number of tests)

conducted in the latter program and "actual effort," since

the "measured effort" is the "actual effort."

Secondly, with regard to the Regulatory Staff's

discussion of migration as a compensatory mechanism, Con

Edison has testified that migration may lead to greater

vulnerability of fish migrating out of the area to preda

tion or other stresses.- However, the Regulatory Staff

has offered no support, not even the educated guess of an

expert witness, for its counter proposition that migration

might also lead to lesser vulnerability to predation and

other stresses.-- / In any event, such a proposition would

not detract from the fact that migration occurring during

the months of September and October could be density

dependent.- / Con Edison believes that the abundance in

September and October is another demonstration, challenged

but unrefuted in the record of this proceeding, of compensa

tory mechanisms operating within the Hudson River striped

bass population.61/

58/ Campbell, Lawler, Marcellus, May & McFadden at 49.


60/ Campbell, Lawler, Marcellus, May & McFadden at 49.

61/ Id.

-23-

Contribution - The Staff unfairly denigrates

the importance of Con Edison's new information on contri

bution of Hudson River spawned striped bass to the Atlantic

coastal fishery. This testimony constitutes a significant

advance over the state of knowledge that existed in the

Indian Point 2 operating license proceeding.

Staff's notion that the as-zlassified estimates

presented in Con Edison's Exhibit OT-2 are the same as

those relied on by the Staff in the Indian Point 3 FES

is wrong.-2/ In the Indian Point 3 FES, Staff used a

90 percent estimate of contribution to the inner zone for

its benefit-cost analysis.m63 The as-classified estimates

show 32 percent.- Staff used a "hypothesis" for the

outer zone of 10 to 50 percent, an obviously wide range.65/

The as-classified estimates showed a contribution to the

outer zone of 19 percent and an overall contribution to

66 the Atlantic coastal fishery of 23 percent.-6/ Although

these numbers are in the middle of the Staff's range, the

difference is important in view of the tendency of the

Staff to use maximum values for a benefit-cost analysis.


63/ Tr. 1032.

64/ McFadden, May & Campbell, following Tr. 1464, Table 1.

65/ Tr. 1032.

66/ McFadden, May & Campbell, Table 1.

-24-

When Con Edison counsel sought to clarify the record on

this particular point, Dr. Van-Winkle said:

I think we're a bit flogging a dead horse here. I think what's relevant is your current iterative and adjusted estimates which I'm perfectly happy to admit certainly do require reconsideration on this issue.67/

The Staff's comment that there has been no

independent assessment-8/ is irrelevant. It is not

necessary for purposes of this proceeding to determine

the correct number but only the existence of new infor

mation on a critical issue which requires independent

assessment in connection with Con Edison's application

of March 15, 1977.

The Staff's criticism of the lack of more than

one year's data is misconceived. 9- - Most of its cited

references concern a general theory of compensation and

have nothing whatever to do with the contribution study.

The reference to Tr. 715 does at least refer to a dis

cussion of the contribution testimony but in a highly

misleading manner. The testimony was that as a general

matter more years' data would be useful. Samples taken

the next year would indicate about the same results and

67/ Tr. 1553.


69/ Id. at 39.

-25-

for the data to be useful, a delay of a fairly long number

of years would be required.--- The Staff is thus seizing

upon the obvious fact that more data would be useful as

support for the very different point that the existing

data are unreliable.-7 1/ Staff ignores the timing problem

referred to above which limited the data that could be

presented by January 1977 to that which could be obtained

in a single year. The Staff also ignores the fact that

these data are vastly superior to those which existed in

the earlier proceeding and led to a wide range of estimates.

The Regulatory Staff's challenge to the assumption

that spawning fish originate in the stream in which they

are found is similarly misplaced. The record shows that

the basis for this assumption was explained- 2/ and that

the results of the contribution study themselves constitute

strong evidence for separate gene pools.7 3/ Staff apparently

seems concerned that it is impossible to establish as an

absolute certainty that a spawning fish found on spawning

grounds originated in that area, but as previously discussed,

that is not the appropriate standard for making important

public policy decisions. This is another illustration

of the Staff's attempt to destroy the results of the

70/ Tr. 716.


72/ Tr. 403.

73/ Tr. 409.

-26-

Ecological Study Program by placing an impossible hurdle

in its path, ignoring the fact that this would leave

important environmental decisions to be made on the basis

of assumptions and general theory unsupported by data.

The Staff's attempt to criticize the iterative

procedure because it is sensitive to the number of

iterations 4/ merely illustrates Staff counsel's mis

understanding of this testimony. The whole purpose of an

iterative procedure is to establish by a series of cal

culations the iteration which best fits the known sample.75/

This is a statistical procedure which necessarily provides

a different result with each iteration. Its significance

should be determined in the proceeding on Con Edison's

application of March 15, 1977, not in this proceeding.

Stocking and Other Species - The Regulatory

Staff's proposed findings on stocking and effects on

species other than striped bass again illustrate that the

Staff has confused this limited proceeding with the

proceeding to vacate the cooling system condition from

the license.2-6/ The Staff acknowledged that Con Edison

has presented significant new information which was not

present in the earlier proceeding on both these issues


75/ McFadden, May & Campbell at 9-10.

76/ Staff Proposed Findings and Conclusions at 42-43.

-27-

when it notes that Con Edison has introduced evidence on

the survival of hatchery fish through a winter and that

Con Edison has testified to the collection of data on

other species. As previously discussed this is all that

need be shown in this limited proceeding. Further,

there is nothing in the record to justify the Staff's

implication that data on other species must permit an

assessment equivalent to that made for striped bass. The

lack of significant sport or commercial value to these

other species and the fact that the Commission's Environ

mental Technical Specification Requirements do not require

equivalent data on these species negate the Staff's

implication.

-28-

II

THE REGULATORY STAFF HAS MISCONSTRUED THE LICENSE BY ATTEMPTING TO AWARD DIFFERENT

WEIGHTS TO EVIDENCE BASED, ON THE ONE HAND, ON PLANT OPERATIONS AND, ON THE OTHER HAND

EMPIRICAL DATA OBTAINED AND ANALYTICAL TOOLS DEVELOPED SINCE THE INDIAN POINT 2 OPERATING

LICENSE HEARING RECORD WAS CLOSED

Where HRFA attempted boldly to assert that Con

Edison must carry a higher burden of proof than the pre

ponderance of the evidence standard that has been establ/

lished and recognized under J[ 2(E) (1) (c) of the License,

the Regulatory Staff has sought, by a more subtle, but

equally unfounded route, to set up essentially the same

impediment to the proper disposition of the present case.

In the course of its analysis, the Regulatory Staff commits

two fundamental errors. First, it reads the provision of

the License permitting applications for relief from the

cooling system condition "with literal exactness like a

mathematical formula,"- although even that reading is

flawed. Second, it erects a complex hierarchy of types of

data analyses, and awards discrete amounts of "weight" to

each, without any basis in the applicable regulations or the

terms of the License.

1/ See Con Edison's Reply to HRFA at 15-16; Con Edison's Memorandum in Support at 2 n.l.

2/ Home Building & Loan Ass'n v. Blaisdell, 290 U.S. 398, 428 (1934).

-29-

The License authorizes applications such as Con

Edison's June 4, 1975 application for an extension of the

interim operation period based upon "empirical data col

lected during . . . interim operation."2 / The Regulatory

Staff reads this in a cramped fashion to refer only to data

of a kind that can only be obtained when the plant or its

pumping system is operating. The License, however, does not

in terms require that the data be of this character. Such

data are obviously of interest, and the Appeal Board ex

pressed its desire that they be obtained in the decision

issued on April 4, 1974.

At the same time, however, the Appeal Board

dedicated much of its decision to an evaluation of areias of

the evidentiary record from the operating license case that

had to do with portions of the Con Edison Ecological Study

Program that were in no way dependent upon actual plant

operations. These included not only the gathering of other

types of empirical data, but the development and refinement

of analytical tools. Examples of this interest include the

entire discussion of the contribution of the Hudson River to

the Atlantic coastal striped bass fishery,-/ the use of

modeling techniques to estimate plant impact,.V/ the im

portant issue of compensation in the striped bass fishery, 6/

3/ Facility Operating License No. DPR-26, ~[2(E) (1)(c).

4/ 7 AEC at 361-65.

5/ id. at 381-87.

6/ Id. at 384-87.

-30-

and the feasibility of hatchery-rearing and stocking striped

bass in the Hudson.]/

Each of these areas was addressed by the Appeal

Board, and each represented an unresolved area of controversy.

Most of them formed the basis for provisions in the Environ

mental Technical Specification Requirements.-/ Each of them

could be studied (some completely, one only partially) in

the absence of plant impacts. To suggest, therefore, that

the fruits of the Ecological Study Program in these other

areas that do not strictly depend upon plant operation are

not proper bases for a jI 2(E) (1)(c) application is to read

the License condition as something separate and apart from

the record of the operating license case, and indeed, from

the terms of the Environmental Technical Specification

Requirements attached to that License.

It is possible to read the License condition as

narrowly as the Regulatory Staff does and come to the

conclusion that the data submitted by Con Edison are all

within its terms because they were collected "during" the

interim operation period, but there is no need to do so

here. We submit that the terms of the License condition

should be read as "words of purchase" rather than "words of

7/ Id. at 400-02.

8/ Facility Operating License No. DPR-26, App. B, § 4.1.2a.

-31-

limitation," and do not provide a basis for excluding from

consideration or giving less credence to the empirical data

obtained or analytical tools developed and refined in the

period since--and in light of--the Indian Point 2 operating

license proceeding. We do not believe it was the intent of

the Commission that 2(E) (1) (c) should be read as pre

scribing blinders for Licensing Boards.

Evidence of the Regulatory Staff's obdurate

perspective appears on page 4 of the Regulatory Staff's

Memorandum, which states that the Indian Point 2 decisions

and the Commission's Indian Point 3 decision "cannot be read

as a blank check for Con Edison to design any new research

project it wished, regardless of whether such research might

have been conducted prior to the decision in the Indian

Point 2 proceeding (or, for that matter, prior to the 'fresh

look' required by ALAB-188)." Passing over the fact that

this statement is in conflict with the Staff's observation,

on page 18 of the same document, that "Con Edison, by its

direction and control over the study program, can select

areas for 'targeted' research which are most likely to

provide evidence supporting their contention that cooling

towers are not required,"' this Staff position shows an

alarming hostility to the possibility of new data or analyses

that might in fact convince an impartial observer that the

balance provisionally struck in 1974 was no longer warranted.

9/ Staff Memorandum in Support at 18 (footnotes omitted).

-32-

No utility has endless funds, and it is unreason

able to characterize Con Edison as having a "blank check" to

conduct research. However, it is equally mistaken to

suggest that anything in the decisions the Staff cites bars

Con Edison (or, we might add, the Staff itself) from pur

suing any avenue that holds forth reasonable promise of

shedding new light on the issues in this case--particularly

where the interests of already hard-pressed ratepayers (who

would bear the cost of cooling towers) are at stake. Obvi

ously it is true that the Environmental Specifications

Requirements "do not preclude any additional study which Con

Edison elects to conduct."'1 0/ Nevertheless, the Environ

mental Technical Specification Requirements should be a

primary guide to the type of information the Staff at least

felt would be useful in addressing the ultimate question of

the need for closed-cycle cooling at Indian Point 2,11- and

nothing in those Requirements supports the suggestion that

some studies merit more attention than others.

Con Edison therefore respectfully submits that the

Regulatory Staff's dichotomy between "research which is

dependent on plant operation" and all other results of the

10/ Staff Proposed Findings and Conclusions at 24 n.86.

l1/ See generally Facility Operating License No. DPR-26, App. B, § 4.1.2a.

-33-

Ecological Study Program is a false one. By the same token,

the Board should reject the Staff's implication, at page 7

of its Memorandum in Support, that data that do not "admit

of and expedite full and prompt independent review" should

also somehow be entitled to less weight in the present pro

ceeding. It comes rather late in the day for the Regulatory

Staff to fault data it has received on the ground that those

data do not comply with the Staff's uncommunicated wishes.

Con Edison should not be penalized for its inability to read

the Regulatory Staff's mind.12 /

The Staff was, of course, in a position to request

that information be submitted in whatever reasonable fashion

it or its consultants felt was necessary.1 3- / No specific

requirements to supply data in "raw" or any other form are

laid down by the License, and the Regulatory Staff has not

made a general request in any other setting in this regard.

Where the Staff has asked for data in a particular form, Con

Edison has complied promptly, providing such materials as

computer tapes, punch cards and the like. The Staff's

12/ Moreover, the Regulatory Staff's own witnesses testified that where materials submitted to the Staff for review are not merely corroborative of earlier work, the process of independent Staff assessment or reanalysis is "substantially more complete and time consuming." See p. 4'0 infra. quoting Spore & Van Winkle at 15-16. Thus the StaT paradoxically appears to be willing to award less weight to the very parts of the data base and analytical tools that its consultants have testified required "full independent assessment or reanalysis."

13/ See 10 C.F.R. § 2.102(a) (1977).

-34-

biological witness testified that when he has asked for

information, Con Edison has provided it. 14/ Accordingly,

Con Edison denies the Staff's innuendo that it has not met

its obligations. In the circumstances, the Regulatory

Staff's Proposed Finding concerning the amenability of Con 15/

Edison's data to reanalysis- should be rejected by the

Board.1 6/ In any event, the Staff testimony was that the

data are being analyzed, and aside from the questions that

were responded to in Supplement 1 to the June 6, 1975 En

14/ Tr. 1507.


16/ The Board should, in addition, strike If 3 of Staff Proposed Finding No. 24, at 24-25, on the ground that besides being a distortion of Dr. McFadden's testimony, it uses that distortion to launch an ad hominem attack on a witness whose distinguished credentials are well known to the Commission's hearing boards. The distortion in the Staff's proposal lies in its misleading juxtaposition of Dr. McFadden's testimony on the preference for "repeatability of an experiment" with his attempt to respond to Staff's counsel's ambiguous question that failed to distinguish replicability of data from replicability of experiments. Tr. 1421-29. The Staff has twisted Dr. McFadden's recognition of the value of "repeatability of an experiment" into a "principle that research should always be reported in a manner which is susceptible of replication." Staff Proposed Findings and Conclusions at 25 & n.91. The transcript shows that Dr. McFadden said that sometimes he would find non-replicable results acceptable, and sometimes not. Tr. 1423. The questioning grew increasingly ambiguous, with the Chairman ultimately sustaining Con Edison counsel's objection. Tr. 1428-29. Hence the Staff's attack is unfounded, unfair (since Dr. McFadden does not have an opportunity to defend himself here) and irrelevant (since, shorn of its ad hominem character, it goes to the merits of the Final Research Report, which is not the subject of this proceeding).

-35-

vironmental Report,1 7-/ Con Edison has thus far received only

one isolated request for information--that attached to the

Spore and Van Winkle testimony.

Without any record justification, the Regulatory

Staff has also asserted that important portions of Con

Edison's Ecological Study Program could have been completed

much earlier than they in fact were. This is a preposterous

charge. The Ecological Study.Program has been an evolving

one, as anyone familiar with the history of Indian Point 2

would admit. It would have required the exercise of clair

voyance to know in advance the challenges that would be

encountered over the course of the program, and the areas of

investigation that would become apparent as the studies

proceeded. The Board, which is familiar with the history of

these investigations, must therefore, reject the Regulatory

Staff's irresponsible contention that much of the Ecological

Study Program could have been conducted "years ago".18/

17/ Con Edison Ex. OT-I ch. 9.

18/ Staff Proposed Findings and Conclusions at 38 n.163. This contention makes as much sense as saying that nuclear power should have been discovered earlier because the existence of uranium was known. In fact, the need for the contribution study was not identified until the Regulatory Staff took the position in the Indian Point 2 operating license Final Environmental Statement that, contrary to all previous literature on the subject, the Hudson River could contribute as much as 80 percent of the striped bass in the mid-Atlantic

-36-

con Edison is,.from its experience in this very

case, - painfully aware of the fact that-review of environ

mental reports by the Regulatory Staff and its consultants

can be a lengthy and time-consuming process.-0 Having been

barred by the Licensing Board from examining the Staff's

consult .ants on those consultants' priorities-l (a con

straint that was not imposed by the Board on the Regulatory

Staf'sconse), 2/we are not in a position even to


fishery. See generally Indian Point 2 FES at XII-35 to 38; Indian Point 3 FES at V-176. That necessitated a new study program which is described in detail in Con Edison's Exhibit OT-2. First, the study had to determine the feasibility of using innate tags to identify origins and to determine the best discriminant functions. Once the feasibility had been established and the appropriate functions were derived, it was necessary to apply a discriminant function to samples taken from the Atlantic coastal. fishery over a one-year period. As described in Con Edison's Exhibit OT-2, this necessarily required a two-year period because of the annual life cycle of the striped bass. The Staff's suggestion that this could have been done earlier is nonsense.

19/ The application and Environmental Report were filed on June 6, 1975. The draft environmental statement was published over 12 months later, in July 1976, with the final environmental statement following the draft in November 1976. Not until February 1977 did the Regulatory Staff perform a benefit-cost analysis.

20/ The same may be said of the Regulatory Staff's processing of requests for technical specification changes, contrary to the rosy picture of "receptiveness" conveyed by the Staff's Proposed Finding No. 25, at 27 & n.101. See Tr. 647.

21/ E.g., Tr. 1128-29..

22/ Tr. 470-76.

-37-

comment on what the Staff intends by its reference to a

"prompt" review (Memorandum at 7). In any case, the fact

that the Staff feels it may take a considerable time to

review the Final Research Report and other Con Edison .23/

submittals--- in no way supports the Staff's contention that

Con Edison's data, or some portion thereof, must be given

less credence. This is particularly true in light of the

fact that even a decision on the ultimate cooling system

question after construction has commenced could produce a

very substantial benefit in terms of avoiding costs.24

Finally, reference should be made to the Staff's

insistence that potential alternatives be "significantly

superior" or "clearly superior to the requested action."- 5/

26/ This puzzling usage--inspired, we assume, by Seabrook,

and offered here presumably as a "proxy" for a res judicata

argument--draws no support from that case, for the Com

mission there took pains to limit its ruling to siting

questions, warning in a footnote that "we do not wish to be

23/ Staff Proposed Findings and Conclusions at 56; Con Edison's Proposed Findings and Conclusions at 71-72.

24/ Con Edison's Proposed Findings and Conclusions at 72; Con Edison's Memorandum in Support at 44-47.

25/ Staff Memorandum in Support at 10, 26.

26/ Public Service Co. of New Hampshire, Inc. (Seabrook Station, Units 1 and 2), CLI-77- , 5 NRC (1977), slip op. at 43, 45.

-38-

misunderstood as suggesting that the obligations of NEPA

analysis are any less than have previously been required by

our staff with respect to alternate sites, or that the

standard adopted above is appropriate for deciding whether

to condition a proposed license." 27 1 Hence, the notion of.

"obvious superiority" has no bearing on this case, since we

deal here not with a siting issue but with a condition to an

operating license.

27/ Id. at 46 n.30 (emphasis in original).

-39-

THE REGULATORY STAFF HAS REPUDIATED THE TESTIMONY OF ITS OWN CHIEF BIOLOGICAL WITNESS THAT NUMEROUS PORTIONS OF THE

ECOLOGICAL STUDY PROGRAM REQUIRE INDEPENDENT STAFF ASSESSMENT OR REASSESSMENT

At the hearing, the Regulatory Staff presented

testimony by three witnesses: Dr. Robert P. Geckler, the

Environmental Project Manager, who served basically in an

editorial role in producing the draft and final environ

mental statements,-/ Dr. Robert L. Spore, an economist, and

Dr. Webster Van Winkle, a biologist. Dr. Van Winkle is the

Regulatory Staff's principal consultant on biological issues

in this case- and was the only Staff witness to testify on

the Staff's biological case or its an alysis of Con Edison's

Ecological Study Program.

Dr. Van Winkle was the co-sponsor of the Staff's

benefit-cost testimony presented in compliance with the

Board's directive of December 10, 1976,-/ and the Staff's

submittals make extensive reference to that testimony for

its economic analysis. In a footnote on page 5 of the

Regulatory Staff's Memorandum, the comment is made that

1/ Tr. 721.

2/ Professional Qualifications of Dr. Webster Van Winkle, following Tr. 719, at 2.

3/ Tr. 869-70.

-40-

"[tihe Staff's witnesses have testified that any piece of

research reporting new or different results will be inde

pendently reviewed," citing the Spore and Van Winkle testi

mony at page 15. An examination of the cited testimony is

revealing, however, for it evinces a Staff desire to abandon

its own witnesses' testimony. The Regulatory Staff's

footnote reference could be taken--indeed,.was probably

intended--to suggest that no such data have been submitted,

whereas the joint testimony of Drs. Spore and Van Winkle

states:

Should the submittals of further information appear to contain significantly new or different information, the staff will perform a full independent assessment or re-analysis of the subject area. This process is a substantially more complex and time-consuming one than that conducted for submittals which may be corroborative of earlier work done by Applicant's consultants or by the staff. For example, in the testimony of [Dr.] Campbell et al. of December 7, 1976, at least five areas appear-to warrant such an independent assessment. They include 1) relative contribution of Hudson River striped bass to the Atlantic coastal fishery; (2) estimates of entrainment mortality, including corrections for differential net mortality and larval-table data; (3) compensation in the Hudson River striped bass population; (4) the method of equilibrium reduction for impact assessment; and (5) consideration of a more comprehensive assessment of the impact of power plant operation.4/

The brief footnote on page 5 of the Regulatory Staff's

Memorandum is the Staff's sole reference to this important

4/ Spore & Van Winkle at 15-16 (emphasis added).

-41-

element of its own evidentiary presentation.

Still more mystifying is the Regulatory Staff's

failure to make any reference whatever to Dr. Van Winkle's

individual testimony--testimony that goes even further in

noting the need for assessment of Con Edison's study results.

At pages 4-5 of his separate testimonyj-/ Dr. Van Winkle,

after indicating the numerous Con Edison reports he had

reviewed,-/ as well as Con Edison's December 7, 1976 panel

testimony, stated:

Based upon a review of that testimony [which drew together information from the research reports], the principal subject areas which contain new information are:

5/ Van Winkle, following Tr. 1069.

6/ Since the December 1976 hearing, it may be added, the following additional reports have been provided to the Commission: (a) LaSalle Hydraulic Laboratory, Indian Point Generating Plants Hydraulic Model Study of Hudson River Flows Around Cooling Water intakes, (b) Dames & Moore, Indian Point Nuclear Generating Station, Intensive Thermal Program, May 1975 Survey, (c) Texas Instruments, Inc., A Synthesis of Available Data Pertaining to Major Physicochemical Variables within the Hudson River Estuary Emphasizing the period from 1972 through 1975, (d) Texas Instruments, Inc., Hudson River Ecological Study in the area of Indian Point, 1975 Annual Report, (e) Influence of Indian Point Unit 2 and Other Steam Electric Generating Plants on the Hudson River Estuary with Emphasis on-Striped Bass and Other Fish Populations ("Final Research Report"), (f) Consolidated Edison Co. of New York, Inc., Indian Point Nuclear Generating Staton, Thermal Survey Program, Routine Monthly Thermal Monitoring, October 1976 Survey, Report No. 1, (g) UMA Engineers, Inc., Striped Bass Rearing Experiments 1975, and (h) Texas Instruments, Inc., Production of Striped Bass for Experimental Purposes: 1976 Hatchery Report. These reports are in addition to those noted in Dr. Van Winkle's testimony.

-42-

1. Relative contribution of Hudson striped bass to the Atlantic Coastal fishery;

2. Estimates of entrainment mortality, including correction for differential net mortality and larval-table data;

3. Compensation in the Hudson River striped bass population;

4. The method of equilibrium reduction for impact assessment.

5. Further assessment of the impacts of power plant operation on the Hudson River white perch and tomcod populations.

In these five subject areas, at a minimum, an independent assessment by the NRC Staff appears essential to any reconsideration of the ultimate question of whether closed-cycle cooling should remain a requirement of the Indian Point 2 operating license. We expect the Applicant's January 1977 Report" to contain new information on

-each of these five subject areas,' although even then certaih important data may still not be available (e.g., larval-table data for 1976).7/

In the ever-changing progression of Regulatory

Staff positions that has characterized this proceeding- it

7/ Van Winkle at 4-5 (page references to Dec. 7, 1976 testimony omitted; emphasis added). In cross-examination, Dr. Van Winkle explained, with-reference to his use of the phrase "at a minimum," that in several other areas not included in his list independent Staff analysis or reanalysis was required. Tr. 1273-94. See also Tr. 756-60, 896, 914, 1309, 1328-29, 1297, 1553.

8/ See Con Edison's Proposed Findings and Conclusions at 11-12; Con Edison's Memorandum in Support at 14. Other changes of Regulatory Staff position include the belated insistence that the Staff was not under an obligation to evaluate extensions beyond May 1, 1981, compare DES S 5.2 and FES S 5.2 with Staff Memorandum in Support at 25; the assertion that there would be no benefit from the requested extension from the standpoint of the EPA adjudicatory hearing process, compare DES SS 4.1.1, 6.4.1 with Staff Memorandum at 26, discussed at pp. 59-61


-43-

would seem that Dr. Van Winkle's testimony no longer suits

the Staff's convenience. Accordingly, the Staff has seen

fit to relegate it to oblivion as if it were the impeached

testimony of an adverse party's witness. Viewed another

way, the Staff appears to have put Dr. Van Winkle's testi

mony forward as a kind of cigar store-Indian, to be wheeled

back into the shop when the day is over.

In this respect we consider that the Regulatory

Staff has done an injustice not only to its own witness, but

also to the Commission's hearing proc ess, which assumes that

the testimony presented by the parties will be of sufficient

materiality that at least the major points will be-worthy of

preservation in the form of proposed findings. On balance,

the Staff's repudiation of Dr. Van Winkle's testimony on the

need for independent assessment or reassessment of the

information provided by Con Edison only tends to confirm the

notion that the Staff's true position is based on undis

closed policy reasons rather than sound biological judg

ment.

S/ Footnote continued

infra; and the expansion of the Staff's estimates of the time that will be required to complete the environmental review of the results of Con Edison's Ecological Study Program. Con Edison's Memorandum in Support at 40-42; see also DES SS 2.2.5.1, 4.1.2; FES § 6.4.1; Staff Prop osed Findings and Conclusions at 56.

9/ For another repudiation by the Regulatory Staff its own witnesses' testimony see P. 55 infra.

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IV

THE REGULATORY STAFF'S USE OF THE INDIAN POINT 3 FINAL ENVIRONMENTAL STATEMENT AND

COMMISSION DECISION REPRESENTS A MISINTERPRETATION OF THE HISTORY OF THAT CASE, A DISTORTION OF THE INDIAN POINT 3 STIPULATION, AND ABANDONMENT OF THE STAFF'S

OWN PRIOR REPRESENTATIONS TO THE COMMISSION, AND, IF ADOPTED, A DENIAL OF CON EDISON'S

RIGHT TO AN ADJUDICATORY HEARING

Like HRFA, the Regulatory Staff has placed con

siderable emphasis on the contents of the Final Environ

mental Statement ("FES") prepared by the Staff in connection

with the Indian Point 3 operating license hearing. The

Staff has essentially sought to recast the issue to focus

not on what has changed in term of plant impact, since the

contested Indian Point 2 license hearing, but rather what

has changed since the settled Indian Point 3 licensing. We

have explained elsewhere the error of this approach,!/ as

well as the dangers inherent in it from the standpoint of

the Commission's expressed recognition that the public

interest is served by appropriate stipulated dispositions of

proceedings that might otherwise be contested.2 /

The error of the Regulatory Staff's position is

compounded, however, because it flatly contradicts repre

1/ Con Edison's Memorandum in Support at 61; Con Edison's Reply to HRFA at 53.

2/ Con Edison's Reply to HRFA at 57; 10 C.F.R. 9 2.759 (1977).

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sentations that the Staff has previously made to the Com

mission and to this Board, leaving one with the sense that

the Staff's positions are in "the same class as a restricted

railroad ticket, good for- this day and train only."3/

The starting point for this discussion is the

letter addressed by the Regulatory Staff to the Board on

February 14, 1977, indicating an intent to request the Board

to take official notice of the Indian Point 3 FES "for the

limited purpose of identifying the contents of that document

as the Staff's position with regard to the necessity for

closed-cycle cooling at Indian Point Unit Nos. 2 and 3 as of

that date." Like HRFA, however, the Staff has insisted on

using this FES--never the subject of an adjudicatory hear

4/ ing--for the truth of its contents.- / We believe that the

Staff is bound by the terms of its request, and is estopped

now, after the hearing, to seek to rely on this FES from

another proceeding for the truth of its contents.

More importantly, the Licensing Board is bound

by its prior ruling on this subject. It barred Con Edison

from cross-examinating the Staff on the substance of the

3/ Smith v. Allwright, 321 U.S. 649, 666 (1944) (Roberts, J., dissenting).

4/ E.g., Staff Memorandum in Support at 10 (arguing that "Con Edison must demonstrate that the data collected during interim operation warrant an extension on the basis of differences in the conclusions they compel as comparred to the conclusions in the Indian Point 3 FES") (emphasis added); cf. Staff's Proposed Findings and Conclusions at 22 & n.73.

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Indian Point 3 FES on the grounds that the merits of closed

cycle cooling were not in issue in this limited proceedS/

ing.

Beyond any estoppel (which applies, as well, to

the Staff's reliance on the merits of its Exhibit OT-2,

which was explicitly offered in evidence only for the

limited purpose of showing that there was disagreement as to

the use of compensation in striped bass modeling),-/ the

Regulatory Staff's use of this FES is in contradiction to

prior representations made to the Commission and constitutes

an effort to "get something for nothing." As we pointed out

in our response to HRFA, the Staff advised the Appeal Board

in 1974 that "the merits of [the Staff's] position can

better be explored .... within the framework of the up

coming evidentiary proceeding in Indian Point Unit 3 rather

than through the mechanism of a petition for reconsidera

tion."' As must be clear, no such evidentiary proceeding

5/ Tr. 906, 912.

6/ Tr. 1090-94; Con Edison's Proposed Findings and Conclusions at 44. The Staff has reneged on this limitation in its Proposed Findings and Conclusions at 44 n. 189. The reason given is without merit, since the circumstance there cited by the Staff was known at the time the Staff made its "limited purpose" offer, and since it demonstrates quite plainly the Staff's wish to confuse the instant case with the merits issues to be resolved in connection with Con Edison's March 15, 1977 application to vacate the cooling system condition.

7/ See Con Edison's Reply to HRFA at 55 n.125, quoting AEC Regulatory Staff statement as to a Petition for Reconsideration, Dkt. No. 50-247, June 14, 1974.

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was held in the Indian Point 3 case, but the Regulatory

Staff treats the FES as if it had been approved following a

contested hearing. 8

The Regulatory Staff is seemingly attempting to

insulate from the hearing process so much of its analysis as

was presented in the Indian Point 3 FES. But by using the

Commission's Indian Point 3 decision to achieve this, the

Staff contradicts its own submission to the Commission in

that case. In its Brief in response to the Commission's

October 23, 1975 Order the Regulatory Staff contended that

an agency cannot modify a license under the guise of interpretive action, thus bypassing the statutory requirements for a hearing. Andrew G. Nelson v. United States, 355 U.S. 554 (1958); USAC Transport v. United States, 235 F. Supp. 689 (D. Del. 1964). We submit that the Appeal Board's action in ALAB287, if it is permitted to stand, is, therefore, erroneous as a matter of law in that the Appeal Board effected a modification of License No. DPR-26 without affording interested persons the opportunity for a hearing.9/

This, however, is precisely what the Regulatory

Staff would have the Board do now with the Indian Point 3

8/ See Staff Memorandum in Support at 10. As we have pointed out elsewhere, the Indian Point 3 case was settled by a stipulation among the parties. That stipulation was limited to Indian Point 3 and its nonwaiver provision would be violated by the approach urged by the Regulatory Staff. Con Edison's Memorandum in Support at 65 & n.189.

9/ Brief of the NRC Staff in Response to the Nuclear Regulatory Commission's October 23, 1975 Order, Dkt. No. 50-286, Nov. 10, 1975, at 48.

-48-

FES, for as the Staff's own witness pointed out1- that

document was no more the subject of a prior adjudicatory

hearing than were, in the Staff's view, the Appeal Board's

dicta in ALAB-287 concerning Indian Point 2. Now that the

shoe is on the other foot--now that it is Con Edison's right

to a hearing that is at stake--the same principle must

apply.

But what of the Commission's power? May the

Commission not, in the exercise of its supervisory author

ity,- I take the necessary measures to control and guide the

course of licensing cases? This is the Regulatory Staff's

contention in this case in support of its allegations that

the Commission has approved the Indian Point 3 FES on the

merits, and that that approval applies as well to Indian

Point 2.12/

There are two problems with this position. First,

it treats the Arkansas Power rule as a constraint only upon

the lower boards, and second, it neglects an important

10/ Tr. 982-83 (testimony of Dr. Van Winkle that the Indian Point 3 FES "was never cross-examined, and there was never a full-blown hearing at that time").

11/ See Niagara Mohawk Power Corp. (Nine Mile Point, Unit No. 2), CLI-73-28, 6 AEC 995 (1973).

12/ As we have elsewhere shown, all the Commission did -and all it had to do -- in the Indian Point 3 case was find the FES to be an adequate environmental disclosure for the stipulated license condition in that case. Con Edison's Reply to HRFA at 56-58.

-49-

limitation that the Commission recognized with respect to

its own action in the recent Seabrook decision, quoted

selectively in the Regulatory Staff's submittal. On each of

these points the Staff's construction is clearly erroneous.

In Arkansas Power,1-/ the Regulatory Staff filed

an exception with respect to what it termed "the [Licensing]

Board's supererogatory recommendation" in the hearing on

issuance of a construction permit for Arkansas Nuclear One

Unit 2 that the operating license for Arkansas Nuclear One

Unit 1 be conditioned in a particular fashion. The Staff

argued that

[tihe record here is limited to Unit 2 and, as [the Licensing Board] recognized .

the Board has no jurisdiction with respect to Unit 1. . . .14/

On review, the Appeal Board granted the Staff's exception,

commenting that "[wihenever an adjudicatory body seeks to

supply answers to questions which are not posed by the

litigation before it, and to which the record in the pro

ceeding is not addressed, there is at minimum an enlarged

potential for an erroneous conclusion. '1 5/

If Arkansas Power was a "going beyond what is

13/ Arkansas Power & Light Co. (Arkansas Nuclear One Unit 2), ALAB-94, 6 AEC 25 (1973).

14/ Regulatory Staff's Brief in Support of its Exceptions to Initial Decision Dated December 1, 1972, Arkansas Power and Light Co. (Arkansas Nuclear One--Unit 2), Dkt. 50-368, at 12.

15/ ALAB-94, 6 AEC at 31.

-50-

require,,'16/ commanded or required,"-1 one wonders why the Staff does not

view the Commission's references to Indian Point 2 in its

Indian Point 3 decision in the same light. The Regulatory

Staff's Memorandum in the instant case attempts to dis

tinguish Arkansas Power on the ground that that decision

"addresses the scope of the Appeal Board's review powers

with respect to a docket not before it." 1 7-/ This suggestion

that the case dealt with the Appeal Board's powers is, of

course, false. The issue posed by the Staff's own exception

in that case had to do with the power of the Licensing Board

rather than the Appeal Board. The fact of the matter is

that the principle for which the Staff was there arguing is

of more general applicability. The Staff took aim at what

it perceived to be a "supererogatory recommendation" per

taining to another facility at the same site, characterizing

that recommendation as "gratuitous". The same may be said

for the discussion of Indian Point 2 by both the Appeal

Board and the Commission in the Indian Point 3 case: the

Indian Point 2 License was not before either body at that

time. The policy expressed by the Appeal Board in Arkansas

Power, then, would be applicable here as well.

16/ 2 Oxford English Dictionary 3159 (Compact Ed. 1971) ("supererogatory").

17/ Staff Memorandum in Support at 9 n.18 (emphasis in original).

-51-

The Regulatory Staff's rejoinder is that the Com

mission, "[w]hen exercising its sua sponte review powers,

• . . is 'not a court constrained by the "passive virtues"

of judicial action. . . . Ultimately the members of the

Commission are responsible for the actions and policy of

this agency, and for that reason [they] have inherent

authority to review and act upon any adjudicatory matter

before a Commission tribunal'." 1 8/ The quoted language is

from the recent Seabrook decision. That decision will not,

however, bear the burden which the Staff would apply to it.

For one thing, the Staff has omitted from its quotation from

Seabrook critical portions of that decision. Thus, the Com

mission prefaced its remark about the "passive virtues" with

the acknowledgment that "we may deal with matters before us

in adjudicatory hearings only on the basis of the record

which has been compiled."1 9/ Similarly, the Commission

noted (in a part of the "inherent authority" discussion that

was not reproduced in the Staff's Memorandum) that that

authority was subject to the constraint, among other things,

of "action on the record."3 -' With the Indian Point 2

18/ Staff Memorandum in Support at 9, quoting Public Service Co. of New Hampshire, Inc. (Seabrook Station, Units 1 and 2), CLI-77- , 5 NRC (1977), slip op. at 19-20.

19/ Seabrook, slip op. at 19.

20/ Id. at 20.

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operating license record not pending before the Commission

or its Boards at the time of the Indian Point 3 decision,

and in any event, with no adjudicatory hearing having been

held even as to Indian Point 3, it is plain that this

"constraint" operates to bar any suggestion that the Commis

sion was at liberty in the Indian Point 3 decision either

(1) to approve the Indian Point 3 FES as a correct statement

on the merits of the cooling system question as applied to

Indian Point 2, (2) to retrofit it to the Indian Point 2

operating license hearing record that was by then long

closed,-1/ or (3) to insulate its conclusions in advance 22/ TeCmiso'

from scrutiny in the present case.- The Commission's

Indian Point 3 decision purports to do none of these things.

Further, since any of these actions would constitute a

denial or material truncation of hearing rights of Con

Edison and other parties, it would be improper to assume

that it was the Commission's intent to have any direct

21/ The Regulatory Staff suggests, at page 10 of its Memorandum in Support, that the Commission did precisely this, when it argues that "the analysis and conclusions of the Indian Point 3 FES have been expressly held by the Commission to fully support the requirement of closed-cycle cooling at Indian Point 2.

The suggestion overlooks the Staff's earlier position that the "fresh look" would be subject to a hearing in the Indian Point 3 case, and its recognition that that hearing has still not occurred. See Con Edison's Reply to HRFA at 55 n.125.

22/ Consistent with its apparent understanding of the impact of the Indian Point 3 decision, the Regulatory Staff did not offer the Indian Point 3 FES in evidence in the present case.

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effect on the Indian Point 2 case.-3 Accordingly, the

Board should reject the Regulatory Staff's attempt to

extract an adjudicatory windfall from the Indian Point 3

FES.

23/ It should also be noted that the Commission did not expand the caption of its Indian Point 3 decision, cf. Vermont Yankee Nuclear Power Corp. (Vermont Yankee Nuclear Power Station), Public Service Electric & Gas Co. (Salem Nuclear Generating Station, Units 1 & 2), Philadelphia Electric Co. (Peach Bottom Atomic Power Station Units 2 & 3), Metropolitan Edison Co. (Three Mile Island Nuclear Station, Units 1 &.2), Duquesne Light Co. (Beaver Valley Power Station, Units 1 & 2), Philadelphia Electric Co. (Limerick Generating Station, Units 1 & 2), Public Service Electric and Gas Co. (Hope Creek Generating Station, Units 1 & 2), Pennsylvania Power-and Light Co. (Susquehanna Steam Electric Station, Units 1 & 2), Union Electric Co. (Callaway Plant, Units 1 & 2), CLI-76-18, 4 NRC 470 (1976), as might have been expected if it had been exercising its "inherent supervisory power," Nine Mile 2, supra Inote 11, with respect to Indian Point 2. Even this power, however, may not be so used as to deprive a party of hearing rights whether in the case at bar, or a fortiori, in some other docket.

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V

THE REGULATORY STAFF HAS, IF ANYTHING CONFIRMED THAT ITS SO-CALLED BENEFIT

COST ANALYSIS WAS A MERE POST HOC RATIONALIZATION THAT CANNOT BE CREDITED

A. Post Hoc Rationalization

The Regulatory Staff's April 22, 1977 Memorandum

in Support in effect confirms Con Edison's argument that the

Staff's benefit-cost testimony was a post hoc rationaliza

tion, by its statement on page 14 that its analysis assumed

a position "which the Staff had earlier articulated." This

position was that the economic value of the fishery had been

determined in prior litigation. The fact is that such a

position had never been articulated by the Staff, or any

other party to these proceedings, until the presentatio n of

the Staff's benefit-cost testimony.-! In that testimony the

Staff for the first time asserted that the cost of cooling

towers could be used to estimate the value of the risk of

damage to the fishery. The assertion that the Staff had

earlier articulated this notion is erroneous and this error

serves to underscore the fact that the concept was in truth

a post hoc rationalization.

The Staff's earlier testimony was that the bio

logical impact of a two-year extension was negligible. The

1/ Spore & Van Winkle at 19-20.

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last sentence on page 14,of the Staff's Memorandum, which

says that the benefit-cost testimony illustrates the

reasonableness of Staff's earlier analysis, is wrong because

it is impossible to reconcile how the economic costs square

with the Staff's earlier analysis of negligible impacts.

The difficulty with this patent inconsistency is

illustrated on-page 24 of the Staff's Memorandum. When it

asks the Board not to rely on the Staff's own biological

witness' conclusion of negligible impact, it is in effect

asking the Board to reject the testimony of its own bio

logical witness. When the Staff goes on to assert that its

"analysis of costs provides a reasonable translation of this

same impact (utilizing the very data upon which the 'negli

gible' conclusion was drawn). into fairly substantial economic

terms", the Staff asserts that negligible biological impact

equals substantial economic impact. This argues that the

Staff's biological witness does not know the meaning of

"negligible," and should not be credited. The assertion

only serves to illustrate that something is very wrong with

either the Staff's biology or the Staff's economics. Since

the biological conclusion of negligible impact is unchal

lenged in the record of this proceeding, the Board must find

that the error lies in the economic assessment, especially

in view of the fact that the economic testimony was a post

hoc rationalization of the Staff's earlier policy and legal

decision to recommend denial of the requested license amend

ment and is inconsistent with its earlier analysis of impacts.

-56-

B. The Staff's Assumption of An Immutable Decision on Cooling Towers

The Regulatory Staff has replied to Con Edison's

objections to the Staff's treatment of the prior cooling

system decisions as being immutable, with the statement that

all licenses can be amended.-/ The Staff is in effect

attempting to value a prior decision by phantasizing as to

the rationale behind it. But there is no need to phantasize.

The Appeal Board made its reasoning very clear in its two

3/ decisions.- The conditions attached to the License were an

inherent part of the Appeal Board's decisions, as the sub

stantially similar conditions were an inherent part of the

Commission's decision with respect to Indian Point 3. The

Appeal Board and the Commission were both well aware of the

existence of § 50.90 of the regulations, cited in the

Staff's Memorandum in Support at page 13, yet it was found

necessary to place in the License, and in the case of the

Commission, to approve, the specific conditions which the

Staff chooses to ignore. It should not lightly be assumed

that the added language was mere surplusage. The insistence

on placing 1 2(E) (1) (c) in the License must have some

meaning, and that meaning is explained in the decisions.

2/ Staff's Memorandum in Support at 13.

3/ ALAB-188, 7 AEC 323 (1974) ; ALAB-198, 7'AEC 475 (1974).

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The Board must reject Staff's Proposed Finding

No. 39 on page 48 that t he conditions need not be con

sidered because the decision has been stated to fulfill the

requirements of NEPA. The only decisions which have been

held to fulfill the requirements of NEPA are decisions which

have approved licenses which included these conditions.

Accord ingly, those decisions cannot justify ignoring condi

tions which those decisions approved.

The Regulatory Staff's witness conceded that if

there had been no previous immutable decision to build a

cooling tower, his methodology could not be used.- He said

that economists would prefer to use a different technique to

provide a direct measurement of the economic value to

society of the impact to the fishery.-V If an immutable

requirement for a cooling tower had not been imposed, the

Staff witness conceded that a technique "along the lines

such as the Applicant used" could be utilized to measure the

value to society.-Y Since, as discussed above, the license

requirement for a cooling tower is not immutable, the

Staff's concessions indicate that the Con Edison methodology

is the appropriate one for use in this proceeding.

Furthermore, the Staff has ignored the fact that

its methodology is not authorized by its own guidelines for

4/ Tr. 1330.

5/ Tr. 1178.

6/ Tr. 1330.

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preparation of benefit-cost analyses,.-/ and the Staff's

witnesses made no attempt to determine whether their anal

ysis was consistent with the guidelines issued by the Water

Resources Council, 8-/ th official government document for

evaluating water resources projects.-/ The Staff's own

guidelines should have greater significance than Staff's

general references to economic theory and literature.1- /

C. The Staff's Computation of Costs

The Regulatory Staff asserts that its use of a

proxy for probability is correct because the proxy proba

bility value varies directly with the true probability

value. I- / The Staff refers to this as a "simple assump

tion."' 2/ It certainly is simple, but the proper question

is whether it is valid. Dr. Van Winkle's only explanation

of his use of this assumption was that "[wie don't have any

7/ Tr. 1175.

8/ Id.; see generally Water Resources Council, Principles and Standards for Planning Water and Related Land Resources, 38 Fed. Reg. 24778 (1973).

9/ See Con Edison Ex. OT-I at 4-37.


11/ Staff Proposed Findings and Conclusions at 51; Staff Memorandum in Support at 16.


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information to make any more complicated assumption."1 3/

Dr. Van Winkle readily agreed that the relationship could be

otherwise.14/ Staff witnesses also were aware of the

novelty of the use of this measure of risk 5/ and no evi

dence was presented to support the invariant linearity of

the summation ratios used as proxies for probability or of

their components as a function of relative yield or time.

Indeed, the Staff suggested a possible alternative

assumption to take into account the expected disproportional

greater weight of incremental effects incurred later in

time.1 6/ If this more reasonable alternative measure had

been used with the same impact curves, the ratio of the two

areas measured would be a smaller number than that used in

the Staff's analysis. In other words, the ratio would be

different from that obtained by making the "simple assump

tion" that the units used by the Staff in its testimony as a

"proxy" for probability "varied directly" with probability.

Of all the possible relationships that could exist

between the "proxy" measure and the true probability, there

is no basis in the record for the assumption that the proxy

measure would "vary directly" with true probability through

13/ Tr. 1217.

14/ Tr. 1217.

15/ Tr. 1236.

16/ Spore & Van Winkle at 26.

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out the range of this measure of time and relative yield of

interest here. If there is not a direct proportionality

over this range, then the proxy for a particular case cannot

be expressed as a "constant"- times the unknown "true"

probability associated with that case. Although the proxy

measure for each case might be expressed as a factor times

the unknown "true" probability associated with the case, the

factor for each case would be different (not "constant"),

and thus when the ratio of two proxy measures is taken, the

factors would not "cancel" as stated by the Staff.17

Therefore, the ratio would not represent the true ratio of

probabilities, as the Staff contends, but an unknown factor

times that ratio from which it is impossible--with the

information given--to determine the true ratio of proba

bilities. Unless the ratio used in the analysis is the true

ratio of probabilities, its use to derive an economic

valuation using the Staff's methodology would be erroneous,.

since the Staff's methodology hinges on this vital assump

tion of direct proportionality. 1 8 /

A further aspect of the Regulatory Staff's pro

posed benefit-cost findi ngs is its claim that the inter

17/ Staff Proposed Findings and Conclusions at 51; Staff memorandum in Support at 16.

18/ Further evidence that contradicts the Staff's "simple assumption" is its concession that the proxy probability could exceed 1. Tr. 1217. Since a true probability can never exceed 1, it is clear that the proxy probability cannot vary directly with the true probability throughout its full range.

-61-

action between the Commission's proceedings and the adju

dicatory hearing to be held by the Environmental Protection

Agency ("EPA") is "neither a cost nor a benefit." 9- The

Staff points, in this regard, to our suggestion that the

extension of interim operation "will facilitate the EPA

hearing process by permitting a continuation of the status

quo while EPA's hearing process runs its course. "3O/ The

Staff, having first opined (properly, in our view) that a 21/

benefit would accrue in this respect,- now has taken the

position that there is neither a benefit nor a cost ap

parently because of the independence of the two agencies'

jurisdictions. The Staff is, in this sense, still relying

on EPA's opaque comments on the Draft Environmental State

22/ ment,- for its Memorandum in Support observes that "EPA's

comments should certainly be deferred to for their rejection

of the idea that the extension would somehow benefit their

proceedings."2 3/ Given the Regulatory Staff's failure to

examine the basis of EPA Region II's comments on the DES,24/

19/- Staff Memorandum in Support at 26.

20/1 Con Edison's Memorandum in Support at 13.

21/ Draft Environmental Statement at-i, §§ 4.1.1, 6.4.1.

22/ FES at A-10.

23/ Staff Memorandum in Support at 26 n.74.

24/ See Con Edison's Proposed Findings and Conclusions at 79; Con Edison's Memorandum in Support at 14-16.

-62-

and the fact that those comments themselves do not provide

an intelligible explanation of EPA's contention that the

requested extension to May 1, 1981 would ,confuse or inter

fere with the EPA hearing process, this suggestion--which

flies in the face of common sense--must be rejected.

The purpose of the requested extension of interim

operation to May 1, 1981 is to avoid the possibility of sunk

costs for a cooling system that turns out, upon examination

of the results of the Ecological Study Program to be un

necessary, or, in the alternative, to limit Con Edison's

exposure to a forced outage imposed by the License in the

event a final decision on the ultimate cooling system

question is reached at a time that does not permit com

pletion of the closed-cycle system by the deadline now

provided in the License. These are substantial interests of

Con Edison and its ratepayers, and they are as real in the

context of action under the Federal Water Pollution Control

Act (whether by EPA or the State of New.York) as they are in

the context of the instant proceeding before the Commission.

Thus, even if the EPA has been silent on the matter, or has • . .25/

submitted ill-conceived and unsupported- comments suggesting

that action in this case will prejudice its own proceeding,

25/ Significantly, EPA Region II's comments on the DES were filed before Con Edison's Final Research Report was submitted to that agency.

-63-

the Board can and should take note of the fact that approval

of the requested extension would in fact serve to avoid or

reduce both sunk costs and needless exposure to a forced

outage not only with respect to the Commission's action on

the March 15, 1977 application, but with respect to EPA's

proceeding as well. This we deem a benefit.

The Regulatory Staff asserts that its analysis

included compensation.2-/ This is a distortion of the

record achieved by selective citation of one portion of a

long colloquy which ended with Dr. Van Winkle's explanation

that in the case of the runs in question the young-of-the

year striped bass model had no compensation and the life

cycle model had fishing compensation.27 / But the point is

that Dr. Van Winkle refused to characterize this impact

estimate as anything more than one of several possible

estimates. He stated that Figure V-13a in the Indian Point

3 FES was equally reasonable.2-8/ This figure had a factor

FI = 0.5, 29 / and produced a lower estimate-of costs.-30 /

The balance of the Staff's Proposed Finding No. 40

is bootstrap, but the statement that this analysis has been

found by the Commission to support the closed-cycle cooling


27/ Tr. 1246.

28/ Tr. 1247.

29/ Id.

30/ Tr. 1254.

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requirement is itself a significant misstatement of. the

record. Dr. Van Winkle repeatedly characterized the Indian

Point 3 FES as presenting a family of curves.-1 Assuming

arg uendo that the Commission approved anything, it approved

this approach, not a particular impact assessment which the

Staff has seized upon in this proceeding. Furthermore, as

noted elsewhere, the Commission's NEPA finding was not that

a cooling tower was required, but a finding which supported

a license which contained several important conditions to

that requirement.

The Staff's calculation also hinges on the crit

ical assumption that a 0.5 impact level is a correct index

of risk of irreverisble damage. The requested Staff finding

that this is 32/oabe is not supported by the record of

this proceeding, which includes the statement that its

selection was arbitrary.-' To say that 0.5 is mc _-e reason34/ Lt

able than other specified extremes- is not the same as

saying 0.5 itself is reasonable. This is critical because

of the extreme sensitivity of the analysis to the selection

of this index. At the 0.4 level the costs go to zero.-5

31/ See Staff Proposed Findings and Conclusions at 20.


33/ Tr. 908.

34/ Tr. 1523.

35/ Tr. 1259.

-65-

When the Staff presented its family of curves, it

said:

Before presenting results, a caveat is in order to the effect that the staff wishes to de-emphasize and discourage efforts to play meaningless games with 'soft' numbers by treating them as 'hard' numbers.36/

When the Staff selects one of its family of curves

for a precise numerical calculation of impact, it is playing

the very game it had previously described as "meaningless".

In summary, the portion of the Regulatory Staff's

Proposed Finding No. 43 on page 52 that its estimate is a

"minimum figure" must be disapproved on the ground that it

is clearly in conflict with the record of this proceeding.

D. Staff's Criticisms of Con Edison's Testimony

The Regulatory Staff 1 ommences its analysis of Con

Edison's benefit-cost testimony by using Staff Exhibit OT-2

for the truth of its contents. 37 / This is absolutely

contrary to the Staff's offer of this document into evi

dence.38- / Staff counsel stated that this document was

offered for a limited purpose "rather than for its probative

36/ Indian Point 3 FES at B-179.


38/ See p. 46 n.6 supra.

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value of for its bottom-line conclusion about the compensa

tion function."39- The Staff now proposes a finding which

is that very same "bottom-line conclusion" for which this

document was not placed in evidence. The Licensing Board

should not tolerate such tactics.

The Staff criticizes Con Edison's use in its

benefit-cost testimony of the estimate of 25% contribution

of Hudson River spawned striped bass to the Atlantic fishery. 0-- /

Contrary to this proposed finding, the basis for Con Edison's

assumption was explained.-'l/ This estimate was not updated

because the benefit-cost testimony of January 18, 1977 was

prepared concurrently with the contribution testimony of

February 23, 1977. In view of the low impact levels, a

refinement to incorporate the latest information on con

tribution was-not considered necessary. The result was an

overstatementi-of cost to the fishery and the Staff's com

plaint is accordingly ill-founded.

The Staff's proposed finding on the value of

impacts other than on recreational striped bass fishery is

inherently inconsistent.--! The Staff asks the Board to

reject Con Edison's zero value as inconsistent with the

39/ Tr. 1081.


41/ Con Edison Ex. OT-I, App. C, at 28.


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Staff's characterization of impacts as negligible. Since

the Staff's negligible impact included the striped bass

fishery as well as other impacts, it is difficult to

comprehend what value could be placed on these less than

negligible impacts other than zero which could.be supported

by the record.

The Regulatory Staff's notion that there is some

significance to the absence of a biologist and an economist

from Con Edison's benefit-cost panel is misconceived. Con

Edison's witnesses stated that they derived their informa43/•

tion from appropriate sources- and an examination of their

testimony shows that it is based on other testimony in this

proceeding which was presented by appropriate experts.

Benefit-cost methodology is commonly used in engineering

evaluations and it is not unique to biology or economics.

i l The Staff made no motion to disqualify these witnesses and

accordingly has waived any right to challenge their exper

tise.

E. Staff's Analysis of Benefits

The Regulatory Staff asserted that the treatment

of reserve capacity dramatically affects the results of the

43/ Tr. 1565.

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.44/ benefit-cost analysis.- This is inconsistent with the

Staff's subsequent correct observation that its own and Con

Edison's estimates of total economic benefits are substan

tially similar.- Treatment of reserve capacity is only

important if Mr. Briggs' suggested methodology is pur

sued.46_

The purpose of a benefit-cost analysis is to

measure impacts. The impact in question is the loss of

capacity by reason of outage of Indian Point 2, which must

be valued in each case under consideartion. If the 1980

loss of capacity is valued at zero, as Mr. Briggs suggests,

that means that the projected reserve level for 1980 is

perfect. The record of this proceeding does not support a

finding that that or any other level of reserves is perfect.

Reliability involves a gradient, i.e., the more the better.47

The fact that a reserve level is above a minimum is impor

tant when planning capacity additions but is not relevant

when valuing a loss of capacity, because a minimum level of

reserves is not perfect.

The Staff is mistaken when it says that Con Edison

argues that the amount of reserve capacity is a fact un


45/ Id. at 55 n.245.

46/ See Con Edison's Memorandum in Support at 55-58.

47/ The Staff misunderstands Con Edison's use of the word "gradient". See Staff Memorandum in Support at 21. Con Edison said that reliability involved a gradient while the Staff associates a gradient with the value of lost capacity as a function of level of reserves.

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related to these proceedings.4-8/ Con Edison's argument was

that the method suggested by Mr. Briggs makes the valuation

of loss of reliability (i.e., bringing 1981 reserves up to

the 1980 level) dependent on facts unrelated to Indian

Point, e.g., outage of an in-city plant, unavailability of

purchased power becuase of delays experienced by other

utilities in constructing generating plants or transmission

lines, and so forth. If such an event occurred in 1980, it

would reduce the cost differential between a 1980 outage and

a 1981 outage. Thus, under this methodology, the computa

tion of the value of an outage of Indian Point 2 becomes

dependent on extraneous events.

The Staff reiterates the notion that the decision

on Con Edison's March 15, 1977 application must be made

before the start of construction of a cooling tower, but

provides no indication of its rationale.4 9/ As previously

indicated, Con Edison considers this a non sequitur.50/


49/ Staff Proposed Findings and Conclusions at 56-57; Staff Memorandum in Support at 23.

50/ Con Edison's Memorandum in Support at 44-48; Con Edison's Reply to HRFA at 41-42.

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The Regulatory Staff adds the suggestion that

there is no benefit in the probability that Con Edison will

not have to build a cooling tower because such a probability

cannot be measured.5-I/ The whole concept of Staff's deter

mination of the need for a cooling tower is its belief that

there is an unquantifiable probability of irreversible

damage to the Hudson River fishery from once-through

52/ cooling.- If the probability of Con Edison's ultimate

success must be valued at zero because it is unquantifiable,

then by the same logic the probability of damage to the

fishery must also be valued at zero because it too is

unquantifiable. The Staff modifies this position somewhat on

the following page by stating that the value of the pro

bability of Con Edison's success "would not be high."53

Since Con Edison has shown that even a low probability of

success would justify granting the instant application,5- /

this statement by the Staff would support Con Edison's

position in this proceeding.

F. Speculation on Future Actions

The Regulatory Staff has proposed a finding that a

hidden cost of this proceeding is the possibility of some


52/ Indian Point 3 FES at xi.

53/ Staff's Proposed Findings and Conclusions at 56.

54/ Con Edison's Proposed Findings and Conclusions at 53; Con Edison Ex. OT-I, S 4.1.4.

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hypothetical future action under the license condition.55/

This is an impermissible consideration, for the Board must act on the instant application without such speculation.56/

Any future applications will be decided on the record of

those future proceedings and in the light of circumstances

as they then exist. The Staff is asking the Board to

speculate that some future decisionmaker will make an

erroneous decision and such speculation is clearly im

permissible. Accordingly this proposed finding should be

disapproved.


56/ Cf. ALAB-188, 7 AEC at 405.

€

€

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CONCLUS ION

For the foregoing reasons, a.nd the further reasons

stated in Con Edison's Proposed Findings and Conclusions and

Memorandum in Support dated March 28, 1977, and Memorandum

in Reply to HRFA's Proposed Findings of Fact and Conclusions

of Law and Supporting Memorandum. dated Aoril 27, 1977, the

Atomic Safety and Licensing Board should rule that the bene

fits of the proposed extension of the interim operation period

to May 1,.1981 exceed the costs, and that, as a result, the

application should be granted.

Respectfully submitted,

LeBOEUF, L.!MB, LEIBY & MacRAE

Leonard M. Trosten Partner

1757 N Street, N.W. -Washington, D.C. 20036

Attorneys for Consolidated Edison Company of New York, Inc.

Of Counsel:

EUGENE R. FIDELL M. REA-MY ANCARROW LeBoeuf, Lamb, Leiby & MacRae

1757 N Street, N.W. Washington, D.C. 20036

EDWARD J. SACK JOYCE P. DAVIS Consolidated Edison Company

of New York, Inc. 4 Irving Place New York, New York 10003

Dated: May 4, 1977

Documents

Memorandum in reply to NRC proposed findings of fact ... · Proposed Findings and Conclusions and supporting Memorandum dated March 28, 1977, and in its April 27, 1977 Reply to the