Free Response to Motion - District Court of Federal Claims - federal

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Case 1:98-cv-00126-JFM Document 792-7

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Filed 04/16/2004 Page 1 of 13

Exhibit4
FRANK C. GRAVES
. Rule 26(a)(2)(B~Disclosure of Publications

. During the Last 'fen Years
How Competitive Market Dynamics Affect Co~ Nuclear and. Gas Gen~ratioD 804 Fu~l Use-A 10 Year Look. Ahead" (with L. S. Borucki, RP. Broehm, S. Thumb, and M. Schaal), Pinal Report May 1999, TR~111506(palo Alto, CA:. Electric Power Research
InStitUte, 1999). .

Price Qws for Standard Offer ServiCe: A Hidden Stranded Co~t" (~th PatiJ. Liu), ElectricityJournal Volume 11, Number 10, December 1998. .
. 0 3.

The

in Ancillary SerVice Mechanismsfor Evaluating (he. Role of Hydroelectric Generation (with RP~Broehm, RL. Earle, T.1. Jenkin, and D. M. Murphy), Final RepOrt, Markets November 1998 TR- l11707 (palo Alto, CA: Electric Power Reseat(:h InstitUte, 1998)~ .

EnergyMarketJmpacts afElectric Industry Restructuring: Understanding WhiJlesale Power
Thumb, A.M. Schaal, L.S. Borucki , and It Broehm), Transmission and Tradil;g. (with . Final Report, March 1998 , EPRI TR- I 08999, GRI -97/0289 (palo Alto, CA: Electric Power

Research Ilb~itUte, 1998).
Economics,

One..PartMarkets for Electric Power: Ensuring the Benefits of Competition" (with E. Grant ower SystetnS Restructuring: Engineeringand Read , Philip Q Hanser, and Robert L. Earle XP

1998), pp. 243-280.
Natural Gas,

M. me , F. Galiana, and L. Fink, cds. (Boston: Kluwer Academic Publishers,

Railroad and:Telecomri1Ul1ications Provide Prior Experience in ' Negotiated Rates '" (with
Carlos Lapuerta), Marketing and Rates,

July 1997.

Regional Impacts of Electric Utility Restructuring on Fuel Markets" (with S. L. Thumb Borucki , and A.M. SchaU), Final Report, April 1997, Vol 1 (EPRI TR. 1O7900.;VIIGRI97/0108. 1) andV 012 (EPRI TR - 107900- V2IGRI -97/0108.2) (palo Alto, CA: Electric Power Research Institute, 1997).
'~The Economics of Negative Barriers to Entry: How to Recover Stranded Costs and Achieve
Industry Restructuring,

Competition on Equal Terms in the :Electric Utility Industry" (with William B. rye), Electric Natural Resources Journal Volume 37, No. 1 ,Winter 1997. .

Capacity Prices in a Competitive Power Market" (withJames A. Read), The
Accounting, Technology Competitive Aspects of the Emerging Industry,

Virtual Utility:
S. A werbuch and

A. Preston, eds. (Boston: Kluwer Ac~demic Publishers, 1997), pages 175- 192.

00068

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Case 1:98-cv-00126-JFM

Document 792-7

Filed 04/16/2004

Exhibit 4
FRANK C. GRA VES
Rule 2~(a)(2)(B)-.Disclosure ofPllblicatioDS
. During~he Last-Ten Years

10.

Stranded Cost RecoverY . and Competition . onEqual Terms" (with W"dliam . B~ Tye),

Electricity Journal Volume: 9, Number 10, December 1996. .

;' ll.
12.

A Framework for Operations in the Competitive Open AcccssEnvironment" (WitbMarija Volume 9, NUmber 3; April DiCaprio), ElectricityJournal, llie, LesterH. FiDk, Alb~rtM. 1996.

Potential ImpaCts of Electric Restructuring on I:ucl Use " EPRI
September 1995~ .

Fuel Insights,

Issue 2,

13.

Optimal Use of Ancillary Generation Under Open Access and its Possible ImplementaUon ML T. Laboratory for Electromagnetic and Electronic Sy$tems Technical LEES TR-95-006 Report,
(with Maria Jlic),

Augl1st 1995.

14~
15.

A Primer on Electric Po11'erFIowfor EconomistsandUtilityPlanners TR- I04604 Electric

. Power ResearchInstitute, EPRI Project RP2123- 19, January 1995.
Hi~rarchicalControl and Priciqg of Frequency Quality and Network Security Under Open Proceedings ofNSF Transmission Access" (with M; IHc; A. Zobian,and P. R. Carpenter),
Workshop on Infrt1$trzilllres in Power Systems
- 16.
Washingto~,

October 1994.

Estimating the Cost of Switching Rights on NaturalGas Pipelines" (with James A. Read, The Enel'gyJolirnal, Volume 10, Number 4, October 1989. 'r. and PaulR. Carpenter),

17.

Demand-Charge GICs Differ from Deficiency-Charge GICs (with Paul R. Carpenter), . Natural Gas August 1989.
What Price Unbundlil1g?" (with P. R. Carpenter),

18.
. . 19.

Natural Gas

June 1989.

Planning for Electric Utilities: The Value of Service" (with James A. Read, Jr.), in Moving Toward Integrated Value- Based Planning, Electric Power Research Institute, 1988.

00069

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. IN THEUNrrBD STATES COURT OF FEDERAL CLAIMS

. YANKEE ATOMIC ELECfRlC COMPANY,
Plaintifl:
No. 98- 126C

(Senior Judge Merow) .

tJNITED STATES OF AMERICA,
Defendant.

IVANF. STUART EXPERT WITNESS REPORT

This report addresses matters relevant to the contract entered into by Yankee Atomic

BlectricCompany ("Yankee Atomic

) with the

government for the acceptance of spent nuclear .
This contract is

fuel and high-level radioactive waste (together "spent fuel").

one of.

approximately SO such contracts. withessentiaUy the same tenns between the government and

conunercial nuclear utilities. The fonn of each such contract is sometimes referred to as a
Standard Contract. I am aware that the Court has held that the government breached\' ankee
Atomic s contract by not beginning to accept spent fuel from Yankee Atomic by January 31,
1998.

Neither the terms of Yankee Atomic s contract nor those of the Standard Contracts
speCify either the pace at which the Department offfnergy ("DOE") should accept spent fuel

from the contracting parties or the schedule on which DOE was required to accept spent fuel
0!

from Yankee AtomiC after the government commenced acceptance. John W. Bartlett has

I.

submitted an expert report in this matter addressing the pace and schedule on which the
government . snoi11ahaveoeen accepting _ spent fuel fr.omY.aiik.ee. A.tonUc ana other contracting.

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Case 1:98-cv-00126-JFM Document 792-7 Filed 04/16/2004
. utilities after JanuaxY 31, 1998 puIsuaitttothe parties' contract. In his report;
Dr~ Bartlett

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concludeS that if the govenuilent had fulfilled its contractual obligations, it would have aCcepted

spent fuel ftom contract holders at the rate of 3000 MTU per year and would have facilitated
swaps of acceptance allocations amongst contracting utilities. . 1 have been asked to present my
:0 :opinions

on the ability of DOE to impiement a spent fuel acceptance schedule with a reasonable

0.

ramp up io 3000 MTU and that would ac~ommodate swaps ofaccep~ce allocations amongst contracting utilities ~ This report presents those opinions and the bases therefor, together with the

other infonnatlon called for in F~ R. Civ. P. 26(a)(2)(B).
Opinions to be Expressed and the Bases Therefor
. I offer the following points as the opinions to which I expect to testify at the trial of this

matter. I present my reasoning for reaching my conclusions along with the conclusions
themselves. My opinions are based on my over 35 years of experience in the field of spent fuel
management, particularly in the area of spent fuel transportation and storage. My opinions are
also based on my review of relevant documents.
My principal opinions are as follows:
The acceptance of3, OOO MTUperyearby

DOE with a reasonable ramp up beginning in

1998 would have been readily achievable if approp riate planning and prepaIi.~ions had started
sufficiently in advance of the January 31 , 1998 deadline set by the Yankee Atomic contract and

. the Standard Contract. Sufficient advance work was clearly possible in view o~ the large body of experience in the transportation of spent fuel gathered by and/or available to DOE prior and

subsequent to 1983. Adequate planning and preparations would have ensured the availability of

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sufticient number of caskS to transport the spent fuel, as well as the availability oran efficient
transportation nenyor\C. This network could have b~n

used for the acceptance of spent fuel in

campaigns" (defined below), arid w~uld have been flexible:enough to accomm~e exchanges

of acceptance allocations amongst contractmg utilities. There are no site sp~ific conditions that
. would have prevented DOE from utilizing acceptance campaigns to transport spent fuelftom

Yankee Atomic. In sum, the spent. fuel acceptance schedule contemplated by Dr. Bartlett in his
report is technically and logistically reasonable.

A. .

DOE' s experience in transporting speiltfuel

Over the course of many years , starting long before the Standard Contracts were.

. fonnulated, a great deal of experience in the transportation of spent fuel was developed~This
experience was developed by and/or available to DOE, and could have easily been drawn upon
and expanded upon to enable the development of a national program that by January 31 , 1998
. would' have begun the systematic transport of spent fuel from reactor sites to one or more

storageldisposallocations in the United States.
Commercial nuclear power has been used for many years in the United States , and

throughout this long history of use significant quantities of spent fuel have been shipped from
reactor sites to col1UtJercial

and g~vernment facilities. These shipments have been for various

purposes, including: testing storage technologies; P9St-~diation fuel examination;. and
reprocessing. Exhibit 1 to this report lists some of the spent fuel shipments that have been

conducted for the government and for nuclear utilities. Altogether, since the early 1960'
enough commercial spent fuel has been shipped by road and rail in the United States to fill (or

00072

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empty) the cores of twentY commercial nuClear reactOI$.
body Qf

exp~ence in transporting spent fuel in fomgn

. countries. Outside the United States, spent fuel shipments are more commonplace than they a:J:
domestically. Most of these shipments are made ftom reactor sites to spent fuel reprocessing

~tersin Britain, France; Japan and Russia. Througli 1998, more than lOO,OOO MTUofSJ?CIit
fuel has been shipp~
by road, rail and sea outside the United States.

This isgre~ter than the .
over

total amount .of spent fuel projected to be discharged frOnT

all

domesticcOlttmercial reactofs

the course of their licensed lives.

Thus , had the government started to commenCe acceptance of spent fuel by January 31,
1998 , there was a wealth of experience that DOE could have drawn and expanded upon prior to

1998 in order to have a suitable spent fuel transportation plan ready for i11ipl~mentation by
January 31 ,

1998.

The availability of casks to transport spent fuel
There wer~ spent fuel transportation casks available well before 1998 to support the
acceptance of 3000 MTU per year with a reasonable ramp up beginning by January 31 , 1998. In

fact, as early as the 1970s , at least two types of casks were available for, and used in, the

transportation of spent fuel bymiI. One of those casks , the General ElectricIF-'300 , isstilUn use
today. fu 1995 ,

the Nuclear Regulatory Commission ("NRC") lic~nsed a cask for the dual
can

. purposes of storage and transportation of spent fuel. That cask, the NAC- STC,

accommodate 26 pressurized Water reactor assemblies , including the assemblies used at Yankee

Atomic.

00073

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Ifexisting caSks

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were determ1ned to be insufficient, DOE cOuldbave readily developed a
to commence the perfonnance ofitS contractwil obHgationsm 1998. .

iransportatiQi;1cask in.tUne

. For example, Nuclear Assurance Corporation ("NAG") was able to Qbtain an NRC licensefot the

NAC-STC within five years of the time NAC started work on that cask. . This amoun~ of time
' reflected extra licensing time reqUired because the NAC';STC was the first dua1~pUtpose
. be licensed by the NRC.
cask to

DOE would not have needed to obtain a large fleet-of casks to establish a receipt rate of

. 3000 MTU per year. The following example iUnstratestbis point: .
. Using the mass of a standard fuel assembly as a reference, the

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NAC- STC' s capacity is equivalent to about 10 MTU. 1 Therefore 300 cask trips per year would be required to establish an
. acceptance rate of 3, 000 MTU. To make a complete cycle with

cask betWeen utilities on the East Coast and an acceptance facility
in Nevada, for example, would require about a one~l110nth

turnaround time. Given a one-month tUrnaround time, and
allowing for two months per year of down time for maintenance,
one cask could transport 100 MID per year. Thus , in this scenario,

as few as 30 casks would have been required to meet the 3000
. MTU acceptance rate.

00074
The Westinghouse 17 x 17 fuel assembly is considered to be a standard fuel assembly.

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Of course, the goveimneitt could have procured a greater number of casks than caUed for in the
. example above, which would have made it even ~ier

to meet the 3000 MTUacceptance rate.

. Regardless of the particular cask model selected, DOE could easily haye design,ed, built,
andlicensed the requisite- number of casks ifit
had started this

process in the early 1990's. In the '

example given above, it would have taken approximately 24 months to (ab~cate theilecessary

number ofNAC-STC casks. Eaclt cask would 4ave cost between $2 and$2~S

million dollars;

thus, thirty or more NAC~STC casks could have been purchased with a small portion of the .

Nuclear Waste Fund~. Had DOE initiated this process early enough, DOE could have procured a
. large

enough fleet of suitable casks to "e available on January 31 , 1998 , to accept 3000 MTU

t~j

with a reasonable ramp up and in an efficient sequence.

Moreover, the " non-standard" fuel, faileq. fuel, and Greater Than Class C (" GTCC"
waste generated by the contracting nuclear utilities would not have been a barrier to DOE'

acceptance of spent fuel in a timely IPanner. With sufficient advanced planning, DOE could also
have developed a ~ask or casks for non-standard fuel , failed fuel, and GTCC waste, obtained the

necessary license from the NRC, and procured enough such casks in time to accept these
materials from Yankee Atomic in a timely manner.

. The use of shipping campaigns
DOE' s transportation perfonnance in fulfillment of its obligatio~. under the Yankee

Atomic contract and the Standard Contracts should have included acceptance campaigns.

Acceptance campaigns are the movement of a relatively large amount of spent fuel from one location to another using personnel and equipment in a repetitive maimer. Shipmeuts of spent

00075

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fuel should be conducted fucampaigns in order to achieve efficient operations, and the
government should bJ\ve done so in this case.

There are several advantages to shipping camp2igtlS versus moving only a small number

of assemblies at a time. Perhaps the biggest advantage is that efficiencies in t1:ansportation
:' . operations can be realized~ Repetitive operations such as cask handling, loading,

' decontamination, receipt and tuinaround all see reduced time per cycle in a campaign.

The value of shipping campaigns is evidenced by $e fact that DOE has encouraged the .

use of campaigns in the spent fuel transportation services forwhich it has contracted. In the
1980' , DOE contracted with NAC to move spent fuel from Taiwan to the United States. This

project included shipping campaign sizes of up to 11 casks. Additionally, a campaign- size of8
casks has been used in the past -- and continues to be used -- by: NAC in the government'

ongoing program to return spent nuclear fuel from research reactors in foreign countries. NAC is

~porting the research reactor fuel pursuantto a contract with the government. In both of
these (:ases , NAC was encQuraged by the government to use shipping campaigns to provide for

the efficient transportation of the spent fuel at issue.
Sufficient transportation resources were available to , or could have been obtained by,
. DOE prior to 1998 to implement the type of acceptance campaigns called for to efficiently accept

. 3000 MTU per year. Returning again to the example cited earlier.
30 NAC- STC casks making 300 cask trips would have been

required to transport 3 000 MTU per year. If each shipment
consistedof5 casks ,

and shipments to the acceptance facility were

00076

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to be conducted by rail, 60 rail shipments would have been .
involvC!d; or about 1 shipment per week

Based on my experience supervising the transport o( s~ent fuel from reactor sites and my
knowledge of the transport and receipt of other heavy equipment, I believe that adequ,ate heavy-

haul vehicles and mobile cranes were available, or could readily have been made available, to
DOE prior to . 1998 to support tl1is level of spent fuel transport ftQm ~ctor sites~

This level of sp.ent fuel tranSport would represent a-very small fraction ,of the current rail. .

system capacity. Union Pacific Railroad alone owns more than 6, 900

locomotives in the

United

States. I estimate that a spent fuel shipment of 5 casks carrying approximately 50 MTU of spent

fuel as defined above would require two locomotives. Therefore, 1 spent fuel shipment on rail
each week would constitUte a fraction of one percent of Union Pacific Railroad' s locomotives.

It should be noted that although the example I have provided features rail transportation.

of spent fuel , my conclusions regarding the technical feasibility of shipping 3000 MTU per year
would not change if truck transportation was included in the DOE transportation system. Based

on the experience I have cited above, I believe that a sufficient number of truck casks and
transporters could readily have been made available to DOE prior to 1998 to support a 3000
MTU acceptance schedule if a mix of rail arid truck transport was used for the DOE
transportation system.

provided simply for illustrative purposes.
00077

There are , of course, numerous ran lines in the United States that could be used for spent fuel shipments alone or in combination with other rail lines. The example of Union Pacific is

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The ability to accommodatesw~s of acceptance allocations

There would be 110 t~bnica1

baniers to swaps of acceptance

allocations amongst

contracting utilities ~der the transportatiop

pro~ described above. The level of

transportation resources ,necessary to establish the 3000 MTU p~ryearacceptance scheduleis

largely independent of the sequence in which spent fuel is to be accepted frOm the contract
holders. More()Ver~ thc;re~uld be enough

flexibility in the program- in. terms of the number of

:. Casks~ the availability

of heavy-haul equipment to handlecasks, and rail system capacity-

accommodate changes in the sequence of spent fuel removal.

Site Specific Conditions forY~ee Atomic
Based upon my experience in variouS aspects of the transportation of spent fuel, it is my

opinion that DOE would have faced no significant logistical impediments to accepting all of the

spent fuel contained in Yankee Atomic s spent fuel pool within one yearftom the

commencement of acceptance. After the requisite 1icense~as obtained ftom theNRC, shipni~nt
would likely begin with heavy-haul vehicleshipm~nt ftom the reactor site to the nearest rail
access point at the Hoosac tunnel about 7 miles from the site. At this point the casks would be
transfelTed to rail cars.

The list of rail routes that could be used to move the train to Nevada, for
potential destinations can be reached by a similar alTaY

example , is provided in Exhibit 2. Other
of rail routes.

00078

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n. '

Data or Information

COns~in

Forming Qpinions
3 to

Data and

o~et:

information I Considered in fonningmy opinions is listed in EXhibit

this

report
Qualifications
My qualifications to offer the opinions included in thiS report, including a list of all

publications.
to this

have authored

wi~ the preceding ten yearS

, are set out in herein

and in

Exhibit 4

report.

IV~

Compensation
. NAG is beingpaid $250 per hour for my time working on

this matter.

00079

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~ExPert

Testimony

.I

have 'not

~edas

an

expert at trial or by deposition in any other cases within the

, preceding four years.

Dated:

June30~

1999

z~~ Stuart
IvanF.

00080