WHY IS ELECTRICITY COMPETITION NOT WORKING? The principal reason is the failure of Order 888 to accommodate the economic and technological constraints of wholesale power markets.
irrefutable answers as to the purely economic analysis.
It makes sense, therefore, to maintain an intense interest in NRC's response to a restructured electric generation market. t
George A. Avery is with Shaw Pittman Potts & Trowbridge, a law firm in Washington, D.C. William R. Holloway assisted with the preparation of this article.
Official Commission Initiatives to Date
Notice of Imminent Changes
NRC actions over the past year and a half have indicated an intent to revise its regulations and practice in response to restructuring initiatives:
Dec. 14, 1995. Industry representatives (federal and state regulators and industry and investment officials) brief the commission on restructuring issues.
Jan. 5, 1996. NRC staff briefs the commission on its near-term, mid-term and long-term action plan to address restructuring issues.
April 8, 1996. NRC issues Advance Notice of Proposed Rulemaking, Financial Assurance Requirements for Decommissioning Nuclear Power Reactors (61 Fed. Reg. 15,427). The ANPR indicates NRC is considering clarification of the definition of "electric utility." It also indicates the NRC may consider holding companies jointly and severally liable for decommissioning costs. (Currently, co-owners are generally responsible only for their individual pro-rata share of the plant.) The proposed rule is expected to be issued for comment sometime in 1997.
May 15, 1996. NRC issues Action Plan for NRC Response to Electric Utility Industry Restructuring and Economic Deregulation, indicating interest in financial qualifications, decommissioning funding and antitrust reviews. Rulemaking is contemplated concerning NRC approval for all licensee corporate changes that significantly reduce assets or recourse to rate recovery. Of considerable interest is that the NRC is considering requiring its approval for a licensee sell-off of non-nuclear assets. The action plan includes schedules for revision of Standard Review Plans (draft 8/96 and final 6/97). The plan will determine the need for rulemaking by June 1997, with a schedule to be established.
July 30, 1996. NRC staff briefs the commission on the status of NRC's actions in response to electric utility restructuring and deregulation. Sept. 23, 1996. NRC issues Draft Policy Statement on the Restructuring and Economic Deregulation of the Electric Utility Industry (61 Fed. Reg. 49,711), indicating interest in joint and several liability for decommissioning funding.
Dec. 27, 1996. Draft Standard Review Plans on Antitrust and Financial Qualifications and Decommissioning Funding Assurance (61 Fed. Reg. 68,309). These draft plans reflect NRC's regulations and do not provide the final NRC position.
April 24, 1997. NRC staff, federal and state regulators, and industry and investment officials briefs the commission on emerging issues in restructuring, including electricity grid reliability, antitrust review, foreign ownership and acceptable state-specific approaches to decommissioning cost recovery.
Transferring Existing Nuclear Plant Licenses
Section 184 of the Atomic Energy Act prohibits the transfer of a license, either directly or indirectly through transfer of control, without the written consent of the NRC. %n1%n Two types of license rights can be transferred: a license to own, which applies to all licensed owners of a plant; and a license to operate, which applies to the one entity licensed to operate the plant. To obtain transfer approval, the party taking over a license