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Case 1:98-cv-00484-JPW

Document 265-4

Efleen Supko

Filed 10/04/2006

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Page25 1 rate and/or sequence of ENF that DOE would be 2 obligated to maintain under the standard 3 contract? 4 A. I believe that I answered the

5 question that discussing DOE's obligation is a 6 legal-issue, and I'm not making a legal 7 conclusion. 8 I'm fully aware of acceptance rates

9 that the Department of Energy has used over the I0 lifetime Qf the program, andI've analyzed those ii rates, as you know, in my expert reports. 12 Q. Outside of your expert reports, do

13 you have any understanding as to the rate and/or 14.sequence of SNE that DOE would be obligated to 15 maintain under the standard contract?
16 17 answered. 18 A.

MR. SILBERG: Objection, asked and

From the beginning of the program,

19 the intent of the program was to have an 20 acceptance rate set such that utilities, nuclear 21 operating companies would not be required to add 22 additional storage capacity after 1998, and to Esquire Deposition Ser~dces D.C. - 1-800-441-3376 061 NID - 1-800-539-6398 VA- 1-800-752-8979

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~Eileen Supko Page26 I work off the backlog to allow timel~ 2 decommissioning, and a rate that does that is a 3 rate that reaches 3,000 metric tons with a fairly 4 short 5- to 6-year rampup period. 5 6 Q. BY MR. GARDNER,: So is the answer to my question, no.,

7 that you have no knowledge about the rate and/or 8 sequence that DOE would be obligated to maintain 9 under the standard contract? I0 II answered. 12 A. MR. SILBERG: Objection, asked and

I stated I have -- that I believe

13 discussing what DOE's obligation is is a legal 14 issue, and that's not something that I'm opining 15 .on.
BY MR. GARDNER:

17 18

I understand you're not opining. I'm asking if you have an

19 understanding. 20 21 Ao Do you have any knowledge? I know that my client, NSP -- I

22 don't recall if Entergy or System Fuels Inc. has Esquire Deposition Services D.C.- 1-800-441-3376 5f19 - 1-800-539-6398 ...... ~.:~.:.:.~. VA.- 1-800-752-8979

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Eileen Supko P~e.27 I submitted reports regarding -- briefs regarding 2 the Department of Energyrs -- the facts 3 associated with DOE's obligations regarding spent 4 fuel acceptance. 5 I know there were many briefs filed.

6 I know that NSP did in fact file one, and their 7 opinion is they were required to pick up spent 8 nuclear fuel at a rate that would have limited 9 the amount of spent fuel storage such that no one i0 would have to add additional storage after ~I 12 13 Q. Now, that's in their brief. i'm asking for your view. Outside of this expert report; do

14 you have any understanding or knowledge about the 15 rate and/or sequence that DOE would be obligated 16 to maintain under the stamdard eomtract? 17 18 answered. 19 She gave you the information. As I said, whether DOE is obligated That's all that I can tell
MR. SILBERG: Objection, asked and

20
22 you.

21 is a legal issue.

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Eileen S~ko

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i 2 Q.. BY MR. GAB!gNER: Okay. So you have ~o knowledge

3 about that?" 4 5 A. MR. SILBERG: Asked and answered. I have no legal knowledge about it,

6 no, I don't. 7 8 Q.

BY MR. GARDNER: Do you have any nonlegal knowledge

9 about the DOE's Obligations under the standard I0 contract? ii 12 A. Q.. It's a legal issue. Okay. So the answer is, no, you

13 have no know!edge2 14 15 16 A. Q. No ~ Thank you. Ms. S~pko -- and i think you

17 testified to-this. You certainly said this in 18 your report -- that the notion ~f no additional 19 at-reactor storage was a key issue identified by 20 utilities. 21 22 A. Correct? Yes. 1V[D - 1-800-539-6398 VA- 1-800-752-8979 :"

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Eileen Supko

1

Q~

Page29 Now, that's in fact what you say in

2 your expert report. 3 4 5 ~ 7 8 Correct? I believe it's page i. MR.. SILBERG: Excuse me. We're referring to the overall -MR. GAP~NER: Yeah. Why don't we go to exhibit i as an

9 illustrative example. i0II Q. BY MR. GARDNER: The very first paragraph, it looks

12 like the middle of the paragraph, yon say -13 A. I don't say that no additional

14 storage. 15 I say that counsel asked me to

16 provide an opinion on the DOE's rate of 17 acceptance of spent nuclear fuel on -- as a whole 18 on 2 key issues identified by DOE in the nuclear 19 industry. 20 One of those is the aggregate amount

21 of additional storage that would be required. 22 Q. Now, are you just relying upon

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Eileen Supko

Page49 1 of SNF equa! to the year's generation rate plus a 2 reasonable share of the backlog, to be tantamount 3 to a request that the rate be sufficient to 4 preclude all additional at-reactor storage? 5 A. That would be the result of doing

6 it, yes. 7 Q. But of course, even under your

8 analysis, there are utilities that required 9 additional at-reactor after 1998. I0 Ii A. Correct? My calculation as we've discussed

12 many times before is based on an oldest fuel 13 first analysis. The -- one of the sensitivity 14 analyses that I do e~amines the use of acceptance 15 rights within a company at any reactor that that 16 company~owns, and it reduces the number fairly 17 significantly such that with the flexibilities in 18 the system, that number -- the amount of 19 additional storage would approach zero, or could 20 approach zero. 21 22 Q.. So I just want to be sure. Your opinion is that under the MID-1-800-539.6398 VA-1-800-752-8979 066

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Eileen Supko

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Page 50 I analysis you conduct, no utility needs additionaL 2 at-reactor storage after 19987 3 4 5 case? 6 A. Q. That's not what I said. I'm asking you, is that in fact the

A.

My calculations in the way that I

7 calculate additional at-reactor storage 8 requirements do show that there would be some 9 amount of additional at-reactor storage. I0 Looking at exhibit i, table 3, which

ii is a sensitivity analysis that includes intracompany use of acceptance rights, I 13 calculated 690 metric tons of spent nuclear fue!. 14 That was at maybe a dozen or so nuclear power 15 plants that would require that. 15 17 18 19 answer. 20 21 A. That may be. I said approximately. And the additional storage. Q. It's 14, actually, isn't it? MR.. SILBERG: Excuse me. If you could let her finish her

22 requirements could be accommodated -- they don't
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Efleen Supko

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Page 109 1 1998, doing other -- taking other actions prior 2 to 1998 rather than implementing dry storage such 3 as a rerack if possible, and they would be 4 plant-specific. 5 6 Q. That's my q~.estion. Have you done any plant-specific

7 analysis to confirm whether a.temporary rack was 8 technically feasible for any of those 14 9 utilities you've identified? I0 II A.. Q. No. .-

Have you made any determination as

12 to whether -- first of al!, let me ask you this: 13 Those 14 utilities that have additional storage 14 needs in 1998, do you know of a~y of those 15 utilities were already impinging upon full core !5 reserve in 19987 17 18 19 A. Q. A. I don't recall. Would that matter? It would, but they could have taken

20 other actions prior to 1998 as I stated earlier. 21 One of the alternatives is to impinge on full 22 core reserve capability. That's not the only

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Eiteen Supko

Page 119 i would have been able to exercise. 2 Q. Correct me if I'm wrong:
You've

3 actually testified that even absent any 4 flexibilities being utilized that 1,030 M~Us of 5 additional at-reactor storage is a reasonable 6 a~nount of additional at-reactor storage. 7 8 A. Correct? I don't think it's. unreasonable.

9 It's a calculated amount based on the information i0 that I used i~ my analysis. Q. And.you believe that that amount is

12 a reasonable amount of additional at-reactor 13 storage. 14 15 A. Correct? The number is what it is. It's

16 based on my analysis. 17. It's not unreasonable given that

18 it's a small number of plants and a relatively -19 again this is a calculated number, It's not 20 necessarily what would have occurred had the 21 industry believed DOE was coming. 22 Q. Is there a difference between-not

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Efleen Supko Paget20 ! unreasonable and reasonable? 2 You seem very hesitant to tell me

3 that 1030-is reasonable. 4 A. I know that based on what I know

5 makes up that number in terms of the number of 6 nuclear power plants that -- whose additional 7 requirements are calculated within ihat number 8 and the amount of storage requirements calculated 9 at those plants that that number is reasonable I0 and could have been accommodated within ~he ii flexibilities that existed. 12 Q. And-we've talked about this before I

13 think most recently in perhaps South Carolina 14 that your upper limit of reasonable additional 15 at-reactor storage would be approximately one 16 year's worth of discharge. 17 !8 19 A. Q. Correct? Yes. Do you know under scenario 3, had

20 the flexibilities been utilized, would there have 21 been more than 2,000 MTUs of additional 22 at-reactor storage? Esquire DepoNfion Ser~ces D.C.-1-800-441-3376

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Efleen Supko

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Pag~ 121

1 2 3

I have not calculated that. So you don't know? Well, as I stated under scenario 3,

4 even if one were -- this is -- I'll characterize 5 this as a qualitative analysis that I'm doing 6 here as we sit -- that from -- from the period 7 2005 to 2009, 900 metric tons per year wouldn't 8 have been enough to eliminate even using trading 9 or only those companies who needed requirements I0 would be able to ship their.spent.fuel.- It Ii wouldn't have been enough to eliminate that. 12 Q. But do you know if it would have

13 been enough.to get the ax~ount of additiona! 14 at-reactor storage to 2,000 MTU in total? 15 16 A. I have not calculated that number. MR. GARDNER: I'm having marked what

17 is going to be exhibit number 14. 18 19 20 21 22 (Supko Exhibit No. 14 was marked for identification.) BY MR. GARDNER: Ms. Supko, do you recognize what 1VID - 1-800-539-6398 VA - 1-800-752-8979
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Eileen Supko P~e i39 ! going to increase, and they've done that for a 2 long time in their analyses. 3 4 Q.~ i'm asking a different question. My question is, have you done any

5 analysis to determine whether the number you've 6 calculated here, !,031.5, would have been 7 different had DOE begun performance in 1998? 8 9 A. Q. No. Eave you done any a~alysis to

i0 determine.of these 14 utilities whether there ii would have been a cost for any of these utilities 12 to accommodate those additional storage 13 requirements that you've calculated? 14 15 A. Q. No, i haven't. Now, you don't include shutdow~

16 utilities in this calculation. 17 18 19 20 plants. A. Correct?
NO.

This is only looking at operating

21

Q.

DO you know what the views are

22 say, PG&E and Eumboldt Bay with respect to when

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Eileen Supko

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1 expert opinion from the Yankee case? 2 3 A. Q.. That's correct. I take it since you don't know

4 Mr. ~raves or his analysis, you don't k~ow if his 5 analysis is consistent with yours. 6 7 8 9 Q. A. Is that fair to say? That's correct. I don't know. If the court in these cases, Judge

i0 Lettow, Judge Braden, and Judge Weiss,' if those ii judges conclude that they need to determine what 12 rate the goverr~ment is contractually obligated to 13 perform at, yon can't address that issue. 14 15 A. Correct? I'm not qualified to make a legal

16 conclusion, so I wouldn't be addressing that. 17 Q. Are you making an affirmative

18 conclusion that scenario 3 is unreasonable? 19 A. My conclusion is that scenario 1 --

20 and I'll -- so I don't misquote myself -- which 21 is a 3,000 metric tons per year rate of 22 acceptance, and I'm !ooking at exhibit one page

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Eileen Supko Page 157
1 transit? 2 3 4 A. Q. Ao Turn-around time. What else? And using that plus some downtime

5 was able to calculate based on an annual rate of 6 acceptance of 3,000 metric tons approximately how 7 many casks would be needed. 8 Q. What rampup did you assume for that

9 analysis? I0 A. It was either -- it was the rampup

II rate that was in legislation, so it depended upon 12 the legislation. 13 Q. Do you recall the different rates,

14 the rampup rates? 15 A. I know that the. very first rampup

16 rate was .consistent with the 1990 ACR shown in 17 table 4 of exhibit i. The rest of them I don't 18 recall~ 19 Q. And what was the -- was your

20 analysis -- you say that you did it on NEI; is 21 that correct? 22 A. Yes.

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Eileen Supko

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1 Q. Was the purpose of that for NEI to 2 demonstrate that 1020 was a good idea? Is that kind of the purpose behind that?

MR. SILBERG: Objection, calls for
speculation. A.

It also included a cost analysis,

8 because part of the discussion was what would the 9 impact on budget be
i0 !i 12 13

MR. GARDNER:
(Recess.)

Off the record.

BY MR. GARDNER: MS. Supko, now, I want to change

14 gears a bit and talk about exchanges, 15 specifically not intracompany exchanges, but !6 intercompany exchanges. 17 And I believe that one way utilities

18 could have additional storage requirements after 19 1998 met was through the use of exchanges. 20 21 22 A. Q. Correct? Could you repeat that? Sure.

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Eileen Supko Page159 That one way that utilities -- the

I

2 numbers you've calculated for additiona! 3 attreactor storage after 1998, one way that could 4 be met is through the use of exchanges. 5 ~ A. Correct? This is a flexibility.in the

7 contract, yes. 8 9 money? I0 ii A. Q. I don't know. You haven't done any analysis to Q. Do you think exchanges would cost

12 determine what a potentia! exchange would cost. 13 14 15 16 17 18 19 A. Q. A. Q. A. Q. Correct? No. Do you think they'd be free? I don't know. Have you ever thought about it? Not in any level of detail. You've never done any analysis to

20 determine how much a utility would be willing to 21 pay to engage in an exchange. 22 !s that fair to say?

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Eileen Supko

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1 2 3 Q. A. That's correct. I have not. Have you done any analysis to

4 determine how exchanges would actually work? 5 A. Since the current system where the

6 government is not coming now until 2017 or 2018 7 if we're lucky, it's highly unlikely that anybody 8 would exchange acceptance rights. 9 Q. Let me be clear: I'm talking ~bout

I0 the but-for world and you're running but-for II world scenarios. 12 My question relates to have you

13 conducted any exchanges analysis in these Dut-for 14 worlds that -15 16 A. Q. I have not. I presume you'd agree that an

17 analysis could be done to determine what an 18 exchange marketplace would have !ooked like in 19 the but-for world. 20 21 22
Ao

Correct? I suppose so. Do you believe that you've got the

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Eileen Supko Pagcl61 expertise to develop such an exchanges model?

2 3 4 other? 5 6

A. Q.

I haven't thought about it. So you don't know one way or the

A. Q.

NO. Hypothetica! question for you:

7 Let's take Boston Edison. They come to you and 8 say, Ms. Supko, could you mode! exchange rights 9 across the industry. i0 II them? i2 13 do it. 14 do it. 15 16 it? 17 A. There are a lot of variables and Q. Why wouldn't you be willing to do Ao I don't know if I would be able to Would you be able to do that for

I don't know that I would be willing to

18 factors involved in such an analysis, and I think 19 it would be difficult to try to capture all of 20 those variables and factors. 21 Q. I'm curious, what do you view as

22 being the different variables and factors that

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Eileen Snpko

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i would go into an exchange analysis? 2 A. I haven't t~ought about it. I had thought previously you had

3

Q.

4 testified and maybe it was the Southern Nuclear 5 trial, Maybe it was SMUD -- I can't remember -6 but I recall that in the past you had said you 7 had run an analysis of exchanges; is that 8. correct? 9 A. I ran analyses of decommissioning

I0 shutdown reactor priority in the early 1990s. II Q, Offering -- in other words, taking

12 the OEF queue as it exists but affording priority 13 to the Yankees a.nd SMUDs of the world? 14 15 A. Q, Yes. Then I'm misremembering that you

16 have not engaged in any type of analysis 17 exchanges?

18 19 any. 20

A.

I don't recall that I've ever done

Q,

Bas'ed on -- you've read the standard

21 contract many times, 22 Correct?

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Eileen Supko Page 163
1 2 A. Q. Yes. Based on your reading of the

3 standard contract, what is actually being 4 exchanged if you know? 5 6 7 A. Q. I'd have to look at the contract. Why don't we do that. For the record, I a~ goinu to give

8 you New England states standard contract. I'l! 9 represent to you it's my understanding that they i0 should be. identical between all 3 sites and in II fact all the 103 reactors I suppose. 12 13 15. 14 15 16 'I 7 (Supko Exhibit No. 15 was marked for identification.) BY MR. GARDNER: Q. Ms. Supko, I've handed you what's MR. GAB]DNER: This will be exhibit

18

19 been marked as exhibit 15, which I'll represent 20 to.you is the standard contract between Northern 21 States and the United States Department of 22 Energy.

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Eileen Supko

Page 164 ~ave you seen t~e standard contract before? A. Q. This specific one? I knew you were going to ask that. No. More generally. A. I have seen the standard contract as

7 it's identified in part 961 of title I0 of the 8 United States Code of Federal Regulations. 9 i0 ii doc~unent~ 12 21679. 13 You should see a section there Q. Okay. Fair enough. If you could turn to page 12 of the It's got a Bates label of COE double 0

14 entitled, E exchanges. 15 16 17 A. Q. Do you see that? Yes. The second paragraph says:

18 Purchaser shall have the right to exchange 19 approve delivery commitment schedules with 20' parties to other contracts for disposa! of SNF or 21 HLW. 22 Do you see that?

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Eileen Supko Page !65 I 2 A. Q. Yes. And is that consistent with your

3 recollection that in fact exchanges would have 4 taken place between approved delivery commitment

5 schedules? 6 7 much. 8 says. 9
I0 exchanges? II A. I haven't analyzed it other than to But you haven't really thought about

A.

Honestly, I haven't thought about it

That's what the language in the contract

12 know that it is a flexibility that does exist. 13 Q. Do you know -- if we can go back to

14 your spreadsheet, which is exhibit 14, do you 15 know which of these utilities that you've 16 idemtified as having additional storage 17 requirements have approved DCSs? 18 19 A. Q. I don't. Okay. Ms. Supko, do you have an

20.opinion as to when the market for exchanges would 21 have developed? 22 MR. SILBERG: Objection, vague and

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Eileen Supko Page 166 ambiguous.
We're referring to the but-f0r 3 world, I assume? 4 5 5 Q. A. I haven't thought about it. BY MR. GARDNER: Do you remember in the Southern

7 Nuclear tria! Judge Merrill asked you that exact 8 question? 9 A. I recall he asked me a question

!0 about exchanges and whether I thought they would Ii have-been possible. 12 Q. Do you recall giving a time frame

13 for that? 14 15 A. Q. I don't. I assume sitting here today you

16 haven't really given any thought as to the timing 17 of when that market would have deve!oped. 18 19 A. Is that fair to say? Well, if the government had

20 performed in '98 -- and I believe this is what I 21 said to Judge Merow -- if they had performed at a 22 3,000 metric tons rate of acceptance and if in

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Eileen Supko Page167 1 fact it appeared that performance was going to 2 continue uninterrupted, the market most likely 3 would have developed. 4 5 5 Q. A. When? After 1998. It could have happened before. I

7 have not really thought about itt but there would 8 have been sufficient flexibility in the system to 9 allow exchanges once the rampup rate started i0 increasing. II Q. You do no a~alysis to determine the

12 timing at which a market would have developed? 13 14 A. Q. I have not. You al~o recal! -- this goes back to

15 the SMUD trial I think -- that you offered 16 testimony that you thought an exchanges market 17 would work similar to a uranium enrichment 18 exchanges market. 19
2O

Do you recal! that? That was in your written direct

21 testimony. 22 A. Yes.

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Eileen Supko .Page168 The companies have exchanged uranium

I

2 in its various forms since the mid-1980s. And it 3 works in a fairly seamless way. 4 Q. When were the uranium enrichment

5 contracts originally signed?

6 7 them. 8

A.

Well, there have been a range of

Are you talking about the enrichment

9 contracts with the Department of Energy, with i0 USEC, with European -Ii Q. When you've made the conclusion in

12 your written direct testimony before Judge Braden 13 that you think that exchanges of acceptance rates 14 would work like exchanges of uranium enrichment 15 contracts, to what were you referring? 16 A. At the time, it was associated with

17 toll enrichment services under Department of 18 Energy contracts. Those no longer exist. 19 Companies stilldo exchange and borrow material 20 from time to time. 21 Q. So were you basing your conclusion

22 about the similarities between those 2 markets to

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Eileen Supko Page 184 1 taking that 20 percent from amot~er utility.

2 3 4 se. 5

Correct?

It doesn't make an assumption per

It just assumes that those companies

6 who had additional requirements could potentially 7 have requirements that were 20 percent less. I 8 didn't analyze the effect on an annual basis. 9 Q. You've done no analysis, then, as to

I0 what would happen if DOE were to grant a ii particular uti!ity's request for an additional 20 12 percent, what impact that would have on other 13 purchasers as that term is used in the standard

14 contract. 15 16 17 A.
Correct? I did not. It's your understanding that

18 utilities that have approved delivery commitment 19 schedules may adjust their al!ocations by 20 20 percent in either direction subject to DOE 21 approval. 22 Correct?

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EileenSupko Page207 i Q. And then it says.: The total 2 systemwide spent fuel arisings are projected to 3 be approximately 86,000 MTUs. 4 5 6 A. Q. Do you see that? Yes. Does your analysis in these spent

7 fue! cases asstune these s~me assumptions or make 8 these same assumptions? 9 I0 A. Q.. No. How have your asst~mp.tions changed

ii between, say, this private rue! storage analysis 12 in 2000 a~d the analysis you're doing for this 13 litigation? 14 15 A. (Pause.) i don't wish to misspeak as to what

16 my current assumptions are, and I don't have them 17 committed to memoryr so I'll give you some 18 approximate answers. 19 20 21 Q. A. BY N-R.. GARDNER: OKay.. The overall analysis that I've done

22 for the various clientN assumes 40-year licenses,

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Eileen Supko Page208 I but I've also done the analysis assuming license 2 extension for all plants ' And I .believe that 3 analysis has been provided to you. 4 5 Q. I want to take them one at a time,. The license extension analysis

6 you'renot offering that in your actual opinion. 7 8 A. Right? I didn't'change my opinion. It

9 doesn't change my opinion. The results are I0 similar. II Q. You don"t even provide that analysis

12 in any of your reports. 13 14 15 A. Correct? It's not in the report, no. It is a sensitivity to show that my

16 opinion wouldn't change. 17 Q. So 40-year licenses yon Sti!l assume

18 that for what I'l! cal! your base case? 19 20 21 A. Q. A. The overall analysis, yes. That assumption will stay the sa~e. For the projection, although it

22 doesn't matter for the projection of acceptance

Esquire.Deposition Services D.C.-1-800-441-3376

M.D-1-800-539-6398 VA- 1-800-752-8979

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Efleen Supko

Page 276 i CERTIFICATE OF COURT REPORTER 2 UNITED STATES OF ~ERICA 3 DISTRICT OF COLUMBIA 4

)
)

I, CHERYL A. LORD, the reporter before

5 whom the foregoing deposition was taken, do 6 hereby certify, that the witness whose testimony 7 appears in the foregoing deposition was sworn by 8 me; that the testimony of said witness was taken 9 by me in machine shorthand and thereafter I0 transcribed by computer-aided transc~iption; that i! said deposition is a true record of the testimony 12 given by said witness; that I am neither counsel 13 for, related to, nor employed by any. of the 14 parties to the action in which this deposition 15 was taken; and, further, that I am not a relative 16 or employee of any attorney or counse! employed 17 by the parties hereto, or financi~lly or 18 otherwise ihterested in the outcome of this
19 action. 20 21

CHERYL A. LORD Notary Public in and. for the

22

District of Columbia

Esquire. Deposition Services D.C.- 1-800-441-3376

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1 2 3 4 5 6
7 8 9 I0 ii 12 13 14 15 16 17 18 19 2O 21 22 23 24 25

IN THE UNITED STATES COURT OF FEDEItAL x SYSTEM FUELS, INC., on its own behalf : and as agent for SYSTEM ENERGY RESOURCES, INC., and SOUTH MISSISSIPPI ELECTRIC POWER ASSOCIATION, Plaintiff,
VS.

CLAIMS

:NO. : : :
:

03-2624C

THE UNITED STATES, Defendant.

.: :

Courtroom 5 National Courts Building 715 Madison Place, NW Washington, D.C.

Thursday, September 21, 2006

VOLUME 4

The parties.met, pursuant to the notice of the Judge, at 9:00 a.m.

BEFORE: THE HONOR/iBLE SUSAN G. BRADEN

090
Heritage Reporting Corporation (202) 628-4888