2003-05-20 Mothers for Peace Opening Brief in CPUC Case

The MFP filed this opening brief in the California Public Utilities Commission rate case regarding Diablo Canyon Independent Safety Committee.

BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

Application of Pacific Gas and Electric Company for Authority, Among Other Things, To Increase Revenue Requirements for Electric and Gas Service and to Increase Rates and Charges for Gas Service Effective on January 1, 2003.(U 39 M)

Application 02-11-017(Filed November 8, 2002) Application of Pacific Gas and Electric Company Pursuant to Resolution E-3770 for Reimbursement of Costs Associated with Delay in Implementation of PG&E’s New Customer Information System Caused by the 2002 20/20 Customer Rebate Program.(U 39 E)

Application 02-09-005(Filed September 6, 2002)

OPENING BRIEF OF THE SAN LUIS OBISPO MOTHERS FOR PEACE

On May 20, 2003, the San Luis Obispo Mothers for Peace (SLOMFP) filed a Revised Petition to Modify the Diablo Canyon Independent Safety Committee. Responses were filed by the California Energy Commission and the Office of Ratepayer Advocates (ORA) supporting all recommendations of the SLOMFP. However, the ORA did not take a position on moving the Diablo Canyon Independent Safety Committee (DCISC) office from Monterey to San Luis Obispo. In contrast, the DCISC and Pacific Gas and Electric Company (PG&E) opposed all recommendations of the SLOMFP with the exception of video-recording of public meetings.

Many of the justifications for the DCISC and PG&E opposition were disturbingly similar. The Structure of the DCISC can be Changed PG&E states that “…the composition of the DCISC and the nominating and appointment structure for the selection of its members was carefully negotiated." The careful negotiations resulted in PG&E consumers paying higher rates without a reasonableness review, in exchange for PG&E accepting full financial responsibility for any downtime, new NRC regulations, replacement of any components, and any other costs of owning and operating Diablo Canyon.

The SLOMFP was never included in any of the Settlements “careful negotiations,” even though the organization was the only party addressing safety impacts of D.88-12-083. Nevertheless, the SLOMFP and the San Luis Obispo Community attempted to work within that framework when the committee first began meeting. Suggestions for a local office and a local staff were requested at the first several meetings. All community suggestions were ignored. As the Commission and the public are aware that this, “careful negotiation” unraveled in AB 1890 and resulted in an energy fiasco, PG&E bankruptcy, and major budget deficits for California. The utility and the Commission did not review the original settlement, nor did it did review the reasonableness before placing Diablo Canyon Nuclear Power Plant (DCNPP) into cost of service ratemaking. Thus, why should the safety concerns incorporated in Appendix C of the original settlement be considered off limits for reorganization?

As PG&E quotes from D. 88-12-083, “the Commission intends that this decision be binding on future Commissions.” This quote referred to the full settlement which was virtually shredded in deregulation legislation. If the financial components of the original settlement can be obliterated, surely there is room to reorganize to improve safety and public trust of the DCISC. Furthermore, there will soon be precedent for the Commission to change fundamental structures of settlements. In a recent Draft Decision in Investigation 98-09-007, the assigned Administration Law Judge recommends adoption of modifications to a settlement originally reached by four parties, including PG&E.

Despite active opposition from two parties, the Administrative Law Judge recommends approval of PG&E’s modifications. The two opposing parties, James Weil and Williams Adams, are active participants in the instant general rate case. SLOMFP is one of the few parties that maintains the same representative now as when the DCISC was created.

The DCISC’s statement that the SLOMFP Petition exhibits “a general misunderstanding of the specifically designated technical purpose and function of the Safety Committee…” is erroneous. The SLOMFP has a clear understanding of how and why the DCISC was created; it was a witness to the deed.

RELOCATION OF THE DCISC OFFICE TO SAN LUIS OBISPO T

he DCISC response to the SLOMFP Petition stated it has “considered” the issue of moving its office from Monterey to San Luis Obispo and “weighed the cost-benefit balance”. The SLOMFP knows that the DCISC could change this “cost-benefit balance” if it held its meetings in less expensive facilities (like the SLO Community library) and if its staff stayed in less expensive hotels. Furthermore, the DCISC states that it has not been asked to move its office for many years. While this is true, it does not mean that the issue lacks merit.

New concerns of operating nuclear plants during an energy crisis, the tragedy and lessons of 9/11/01 (and the resulting statements by our government of threats to nuclear plants), and PG&E’s application to store high-level radioactive waste on our earthquake prone coastal zone inspired the community to revisit this issue. The DCISC’s response claims that the “…location or even the existence of an office is a detailed resource allocation matter, again, best left to the consideration and discretion of the Safety Committee.”

The CPUC allocates the funding, the ratepayers pay these funds, and yet the DCISC states that its independence would be jeopardized by a Commission decision to place the office for the DCISC in the community in which Diablo Canyon is sited. SLOMFP finds this reasoning absurd. SLOMFP is looking for a committee that is accessible to its clientele. By its own admission, the DCISC has used its “discretion” to refuse to locate its office in the community most concerned and most impacted by the safe operations of DCNPP.

The DCISC states on page 18 of its response that: “The settlement agreement gives the committee considerable discretion regarding its internal organization and operations. This is appropriate, given the committee’s independent status and high qu alifications.” However, allowing the DCISC discretion does not equate to a disregard of the community’s request for a local office. And contrary to the DCISC’s assertion that there is not community interest, the Green Party, the Santa Lucia Chapter of the Sierra Club, an editorial by the local newspaper, 85% of the public comments during the August 27, 2003, public participation hearing and nearly 400 signatures on Petitions supporting the SLOMFP recommendations - all asked that the office be relocated.

The DCISC believes that their meeting schedule, agendas, “800” number, and website are comparable to a local office. The SLOMFP proposes that the DCISC maintain the schedule, agenda, 800 number and website AND relocate its office to San Luis Obispo.

SAFETY ISSUES AT DIABLO GO BEYOND OPERATIONS PG&E and the DCISC assert that the SLOMFP Petition “…provides no new or substantial facts on which to base this claim [heightened safety concerns].” But, in its Petition, SLOMFP has identified issues that have heightened safety concerns in the community surrounding DCNPP: o the “energy crisis” relied heavily on nuclear plants operating at maximum capacity; o events of 9/11/01 resulted in government proclamations that nuclear plants are at risk of terrorist attacks; o updated seismic criteria is needed for the proposal to expand onsite storage of high-level radioactive waste; o transportation of radioactive material must be addressed; o a possible license renewal would increase nuclear waste on site.

In its response, the DCISC states that its charter is simply the following: “The Committee shall review Diablo Canyon operations for the purposes of assessing the safety of operations and suggesting any recommendations for safe operations.” Clearly, the original Settlement Agreement NEVER anticipated PG&E’s application for a high-level radioactive waste facility onsite or the now realistic threat of terrorism at US nuclear plants. Furthermore, under the 1989 Settlement that created the DCISC, all aging components and new NRC regulations were to be the financial responsibility of PG&E and NOT passed on to ratepayers.

In the current General Rate Case, PG&E is beginning to pass on costs never intended under the settlement. If costs never anticipated can be reviewed and amended, surely a second look at improving effectiveness of the DCISC should be carefully considered by the CPUC. The DCISC has not shown interest in the Contentions filed by San Luis Obispo Intervenors regarding PG&E’s application for a high-level radioactive waste facility. The DCISC asks PG&E questions, but does not attempt to speak with opposing experts. It has dismissed the concerns of the community intervenors, while the County of San Luis Obispo and the California Energy Commission have supported full hearings on all Contentions.

The DCISC believes that “any changes to the specific and proven language of the Settlement Agreement and Decision should not be made without an obvious reason, purpose and benefit, none of which are established by the Petition.” Again, when it comes to rates and liability of PG&E for aging components and new NRC regulations, the Settlement has been changed more that once. SLOMFP claims that it is reasonable to make changes to increase safety oversight and public trust.

PG&E response advises the Commission that one member, Gail DePlanque, applied for and obtained security clearance. However, at the June 2003 DCISC meeting, the public expressed its concern regarding the secrecy of who had met with the NRC to establish its recent updated security policies. Ms. DePlanque stated from a document she had in her possession that there had been three “public” meetings. Ms. DePlanque’s statement was misleading, as the only issue discussed in public meetings regarded security impacts of worker fatigue, which is a very small component of the NRC’s new security requirements.

QUALIFICATIONS OF A LOCAL MEMBER Qualifications of DCISC members as technically experienced within the nuclear industry is not at issue. The Petition specifically requests that the Committee also include those that have technical expertise in nuclear issues (and possibly seismic issues), and demonstrated a questioning of safety issues over the years. This does not imply an opposition to nuclear power, but a demonstrable questioning of adequate safety concerns. In addition, experience in accessing defense-in-depth at nuclear facilities and nuclear transportation expertise would be very appropriate at this time.

San Luis Obispo County has a well respected university, and many qualified members of our community could add value to the DCISC. Furthermore, a public member would understand the community’s safety concerns and make sure that they are addressed (without ridicule). A local member would not bring the expense of travel, room, and board and, therefore, could be accommodated easily in a slightly amended budget. Technical expertise resulting from years in the nuclear industry (this includes the NRC) is not the only avenue to adding additional assurance of safety. Requesting that a qualified member of our community be appointed to the DCISC in no way “denigrates the purpose and function” of the DCISC, or “the intentions of the parties to the Settlement Agreement.”

PG&E is concerned that a “potential for split votes—2 to 2—among the members and no clear path for breaking the tie” would occur. The SLOMFP has attended a few DCISC meetings and reviewed tapes of others, and the only votes observed have been the acceptance of reports and approving minutes - hardly a “split vote” concern. PG&E states that “the DCISC be comprised of ‘three members, one each appointed by the Governor, the Attorney General, and the Chairman of the California Energy Commission…” There was no magic to the number “three” and, again, the SLOMFP was not allowed to be a party to settlement negotiations. This omission has created a distrust of the DCISC. Furthermore, the SLOMFP is not requesting that the appointing bodies be changed.

The California Energy Commission, Coastal Commission, and Regional Water Quality Control Board all have public members also hires technical experts - and all are able to provide appropriate oversight. The DCISC has hired technical experts and still believes a member of the public would “diminish the effectiveness of such a body.” The claim is unfounded and offensive.

REMOVING PG&E AS A NOMINATOR FOR THE SAFETY COMMITTEE IS A FIRST STEP IN PROVIDING THE “INDEPENDENCE” IN THE DCISC SLOMFP fails to see the rational for PG&E’s statement that removing the utility from the nomination process for candidate selection would “transform member selection into a partisan political appointment process.” The DCISC also makes the argument that “…no appointment to the Safety Committee [has] ever been considered to be a partisan political appointment by any of the appointing authorities, and care should be taken by the Commission to insure that it is not permitted to become so in the future.”

The CPUC, California Energy Commissioners are political appointees. The Governor and the Attorney General are appointers of the DCISC and are elected. Politics have always played a role in all aspects of utility regulation. But PG&E states its “…role is limited to working…to develop a list of qualified candidates.” This is akin to asking Enron to develop a list of qualified candidates for FERC. The appearance of bias is evident to all and undermines public trust of the DCISC. Applicants are asked to disclose conflicts of interest, but there is not bigger conflict of interest than having the utility that the DCISC is supposed to review be screener and nominator of applicants.

THE DCISC WAS CREATED TO DO MORE THAN AN ANNUAL REPORT “It [DCISC] shall prepare an annual report, but there is no requirement that it really do anything else…” Does the DCISC really expect the CPUC and the public to believe that an annual report was worth $500,000 (now escalated to approximately $750,000)? How would a report qualify as an “additional assurance of safety to residents who live in emergency evacuation zones of DCNPP?

THE CPUC HAS A RESPONSIBILITY TO REVIEW AND OPEN ITS REVIEW TO THE PUBLIC DCISC REPORTS AND EXPENSES The DCISC was negotiated to have one member going through the nomination and selection process each year. Yet the last request for applications was sent by the CPUC in 1999. The DCISC and PG&E cite the “energy crisis” for the CPUC’s delayed action; however the residents of San Luis Obispo fail to understand why the “energy crisis” would decrease the CPUC’s concern for a safely operated nuclear plant. On the contrary, the need for additional assurance of safety should have been expanded during a time when utilities were operating at maximum capacity and all eyes were concentrated on electricity - not on safe operation.

For the past two years, the SLOMFP has attempted and failed to locate a person at the CPUC who knows the status of this situation or the person in charge of the process. Furthermore, after requests to several on the CPUC staff, no one has been able to locate the office or staff in charge of DCISC applications or review of the expensive DCISC budget. Someone must be accountable to PG&E ratepayers who are funding this Committee.

THE LOCATION OF DCISC DOCUMENTS AT CAL POLY IS NOT AN ADEQUATE SUBSTITUTE FOR A LOCAL OFFICE In its reference to “lodging its entire and very substantial work product at the NRC Public Document Room at the R. E. Kennedy Library at Cal Poly…” , the DCISC states that it is a “freely accessible tool” . Obviously, no member of the DCISC or its staff has had the experience of going to the library at Cal Poly, where parking is challenging and librarian hours to help locate documents is sporadic at best. Furthermore, the ratepayers and taxpayers pay for this service, yet copies of documents cost ten cents a page – and one must bring a supply of dimes.

NOTHING IN THE SETTLEMENT AGREEMENT PREVENTS THE DCISC FROM ATTENDING OVERSIGHT HEARINGS The effectiveness of NRC’s oversight has been called into question several times in the past few years - even by its own Office of Inspector General. It is apparent to many that the NRC is an oversight agency that has a close relationship with the nuclear industry and an extremely adversarial one with the public. Therefore, public trust and participation in the DCISC process would only help to improve the safety oversight at DCNPP.

If the CPUC, the Attorney General, or the public at large had complete trust in the NRC’s ability to fulfill its mandate to protect public health and safety, the DCISC would never have been created. The DCISC describes itself as “…a technically-based, safety directed committee overseeing the safety of plant operations.” This definition would imply the need for the DCISC to attend NRC meetings. It would add an additional level of security.

CONCLUSION

The DCISC response describes the SLOMFP as “a decades-old community advocacy group, the long-term loyal opposition to the nuclear plant.” If the CPUC looks carefully at the SLOMFP activities over its 30+ years, it will find that issues of nuclear safety have been at the forefront of its filings. In contrast, the DCISC has been comprised of nuclear power advocates from its inception.

Just since filing the Updated Petition to Modify, several events have occurred to substantiate the need for a DCISC who has the trust of and a presence in San Luis Obispo. For example: In early August a blackout which affected much of the East Coast resulted in 22 nuclear plants scramming to shut down;  The same blackout resulted in loss of power to emergency sirens in four counties in New York which surround Indian Pt. § On 9/4/03 our local newspaper The Tribune headline read "Nuclear Plants warned of online peril;   Finally as mentioned earlier, our community showed up in numbers and submitted names on petitions supporting all of the SLOMFP recommendations to reorganize the DCISC. SLOMFP urges the CPUC to adopt all recommendations of the SLOMFP and immediately announce applications for two Committee positions which have been termed for at least two years. Respectfully submitted, Rochelle Becker September 17, 2003 San Luis Obispo Mothers for Peace P.O. Box 164 Pismo Beach, CA 93448