ML25094A211

Petitioning Organizations Reply in Support of Amended and New Contentions

ML25094A211
Person / Time
Site:	Palisades
Issue date:	04/04/2025
From:	Lodge T, Taylor W Beyond Nuclear, Don't Waste Michigan, Law Office of Terry J. Lodge, Law Offices of Wallace L. Taylor, Michigan Safe Energy Future, Nuclear Energy Information Service, Three Mile Island Alert
To:	Atomic Safety and Licensing Board Panel
SECY RAS
References
RAS 57335, 50-255-LA-3, ASLBP 24-986-01-LA-BD01
Download: ML25094A211 (0)

Text

UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION Atomic Safety and Licensing Board In the Matter of HOLTEC DECOMMISSIONING INTERNATIONAL, LLC, AND HOLTEC PALISADES, LLC (Palisades Nuclear Plant - Request for Exemption and License Amendments)

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Docket No. 50-255-LA-3

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April 4, 2025

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PETITIONING ORGANIZATIONS REPLY IN SUPPORT OF AMENDED AND NEW CONTENTIONS Now come Beyond Nuclear, Dont Waste Michigan, Michigan Safe Energy Future, Three Mile Island Alert and Nuclear Energy Information Service (Petitioning Organizations, shortened to Petitioners for purposes of this memorandum), by and through counsel, and reply in support of their Amended and Substituted Contentions and New Contentions. The Petitioning Organizations oppose and refute the arguments raised by the NRC Staff in the NRC Staff Answer to Petitioning Organizations Motion to File Amended and New Contentions (Staff Answer), and Applicants Answer Opposing Beyond Nuclear et al.s New and Amended Contentions (Holtec Answer), filed by Holtec Decommissioning International, LLC, and Holtec Palisades, LLC, the Applicants.

STANDARDS FOR CONTENTION ADMISSIBILITY Throughout the Answers filed by NRC Staff and Holtec, there is a serious misapplication of the standards for admissibility of contentions. The arguments made in the Answers essentially require the Petitioners to prove the merits of their contentions at the outset. But that is not the standard by which this Board must evaluate the admissibility of the contentions.

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The pleading requirements of 10 C.F.R. 2.309(f)(1) do not present the overly burdensome standards asserted by NRC Staff and Holtec. The standards are not meant to be insurmountable.

Duke Energy Corp. (Oconee Nuclear Station, Units 1, 2, and 3), CLI-99-11, 49 NRC 328, 335 (1999) (explaining that the rule should not be used as a fortress to deny intervention) (internal quotation marks and citation omitted); see Entergy Nuclear Operations, Inc. (Palisades Nuclear Plant and Big Rock Point Site), CLI-22-8, 96 NRC 1, 104-05 (2022) (admitting for hearing portions of a contention that raised a genuine material dispute with the application). The rule serves to assess the scope, materiality, and support provided for a proposed contention, to ensure that the hearing process is properly reserve[d]... for genuine, material controversies between knowledgeable litigants. FirstEnergy Nuclear Operating Co. (Davis-Besse Nuclear Power Station, Unit 1), CLI-12-8, 75 NRC 393, 396 (2012) (internal quotation marks omitted).

Contentions must have some reasonably specific factual or legal basis. Entergy Nuclear Vermont Yankee, LLC, and Entergy Nuclear Operations, Inc. (Vermont Yankee Nuclear Power Station), CLI-15-20, 82 NRC 211, 221 (2015) (internal quotation marks omitted); see also Palisades, CLI-22-8, 96 NRC at 45 (rejecting argument that did not establish a supported genuine dispute with the application). Specificity is key: mere speculation is insufficient, see, e.g., Dominion Nuclear Connecticut, Inc. (Millstone Nuclear Power Station, Unit 2), CLI-03-14, 58 NRC 207, 216 (2003) (rejecting an argument that, at best, was based on speculation); GPU Nuclear, Inc. (Oyster Creek Nuclear Generating Station), CLI-00-6, 51 NRC 193, 208 (2000)

(finding bare assertions and speculation insufficient to trigger a contested hearing), and a petitioner may not simply reference documents without clearly identifying or summarizing the portions of the documents on which it relies. See Fansteel, Inc. (Muskogee, Oklahoma Site),

CLI-03-13, 58 NRC 195, 204 (2003); Public Service Co. of New Hampshire (Seabrook Station, 2

Units 1 and 2), CLI-89-3, 29 NRC 234, 240-41 (1989). While petitioners need not prove their contentions at the admissibility stage, the contention admissibility standards do require petitioners to proffer at least some minimal factual and legal foundation in support of their contentions. Duke Energy Corp. (Oconee Nuclear Station, Units 1, 2, and 3), CLI-99-11, 49 NRC 328, 334 (1999).

Based on the foregoing, NRC Staff and Holtec cannot, as they have repeatedly done in their Answers, attack Petitioners contentions as being inadmissible by attempting to require Petitioners to present enough evidence to prove the merits of the contentions at the threshold. As an example of this misuse of the admissibility criteria, the decision in Pacific Gas and Electric Co. (Diablo Canyon Independent Spent Fuel Storage Installation), 98 NRC 1 (2023), is instructive.

The proceeding concerned a hearing request from San Luis Obispo Mothers for Peace (SLOMFP) challenging an application from Pacific Gas and Electric Company (PG&E) to renew its license to store spent nuclear fuel in the Diablo Canyon Independent Spent Fuel Storage Installation (ISFSI) for an additional 40 years beyond the current license expiration date. The petitioners contention alleged that PG&Es analysis of its financial qualifications to operate the ISFSI failed to satisfy 10 C.F.R. § 72.22(e) because the analysis was based on the invalid assumption that PG&E would not seek renewal of the operating licenses for the Diablo Canyon reactors. PG&E countered that the contention was inadmissible because it failed to satisfy the materiality requirement in § 2.309(f)(1)(iv) because PG&E is financially qualified to continue operating the ISFSI regardless of whether the reactor licenses are renewed. However, the ASLB determined that that argument went to the merits, and that the issue at that point was only whether the petitioner had satisfied the contention admissibility requirements.

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Another way to contextualize this point is to compare contention admissibility to the way a motion to dismiss is addressed in federal court. Pursuant to Federal Rules of Civil Procedure 12(b), a motion to dismiss is evaluated by accepting all factual allegations in the complaint as true and drawing all reasonable inferences in favor of the plaintiff. Ashcroft v. Iqbal, 556 U.S.

662 (2009). If, by doing so, the complaint fails to plausibly state a claim, then dismissal is warranted. Beyond the motion to dismiss, if facts are developed, a party can file with the court a motion for summary judgement, where the judge reviews the facts to determine if there is a genuine factual dispute. That would be analogous to the motion for summary disposition provided in 10 C.F.R. § 2.710, which is available only after a contention is admitted for hearing.

The NRC Staff and Holtec insist that this preliminary stage of the proceedings must be conducted as a substitute trial by procedural motion for summary disposition. Such one-stop shopping must be rejected by the Atomic Safety and Licensing Board.

The current contention admissibility standards were adopted in 1989 because there was concern that the previously existing standards allowed intervention for petitioners who had no real basis for their contentions. 54 Fed. Reg. 33,168 (1989). The Federal Register discussion states that the rule, now 10 C.F.R. § 2.309(f)(1), does not require the petitioner to make its case at the contention admissibility stage, but merely to indicate what facts or expert opinions that provide the basis for the contention. The Federal Register discussion goes on to say that a petitioner need only include some alleged facts in support of its position sufficient to indicate that a genuine issue of material fact or law exists. This prevents admission of a contention where the petitioner has no facts to support its position and where the intervenor wants to use discovery or cross-examination as a fishing expedition.1 Most importantly, the Federal Register makes the following statement:

1 54 Fed. Reg. at 33, 171 4

[The rule] was intended to parallel the standard for dismissing a claim under Rule 12(b)(6) of the Federal Rules of Civil Procedure. The intent of Rule 12(b)(6) is to permit dismissal of a claim where the plaintiff would be entitled to no relief under any set of facts which could be proved in support of his claim.2 It appears that since the current contention admissibility rules were adopted in 1989, NRC Staff and permit applicants have presented arguments that mischaracterize and misapply the intended scope and purpose of the admissibility standards. Petitioners respectfully ask this Board to evaluate the admissibility of the amended and new contentions as originally intended.

REPLY IN SUPPORT OF AMENDED AND SUBSTITUTED CONTENTION 2

1. Holtecs CATEX requests are moot Holtec claims that the Petitioners merely attempt to challenge the conclusion in a cursory, unsupported manner and that, unfortunately for Petitioners, the draft FONSIs conclusion is not new and materially different from the information presented in the LARs.3 Holtec says that because its four pending License Amendment Requests (LARs) express the position that they are categorically excluded under NEPA, and the proposed Finding of No Significant Impact (FONSI) is a finding that an environmental impact statement is not necessary, that there is no contradiction between Holtecs wish for no NEPA inquiry and the EA conclusion, making amended Contention 2 inadmissible.

Unfortunately for Holtec, apples arent oranges. As the Commission stated earlier in this proceeding, Section 51.22(b) simply allows an interested person to request that the Commission make the determination that special circumstances exist that warrant an exception to the categorical exclusion. Entergy Nuclear Operations, Inc., et al. (Palisades Nuclear Plant), 96 NRC 1, 70, CLI-22-8 (2022).4 And since a 10 CFR § 51.22(b) categorical exclusion is a 4 Holtecs invocation of the 2022 Palisades ASLB decision to support its assertion that Petitioners are obliged to challenge its CATEX requests is unavailing. The CATEX requests at Palisades subject to the 3 Holtec Answer p. 21.

2 Id.

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request, not an adjudication, the NRC, as the entity which is statutorily responsible for compliance with NEPA, exercised its plenary discretion to ignore or deny the request for CATEX classification and proceed, as it did here, to compile an Environmental Assessment (EA) or an Environmental Impact Statement (EIS). On June 24, 2024, the NRC published a Federal Register notice to conduct a scoping process to gather information to prepare an environmental assessment (EA) to evaluate the environmental impacts from proposed Federal actions related to reauthorizing power operations at Palisades.5 The NRC addressed the CATEX requests made by Holtec and overruled them, choosing to prepare an EA instead:

While HDI concluded that the proposed NRC actions meet the categorical exclusion (CATEX) criteria, the NRC staff, after reviewing the CATEX criteria in 10 CFR 51.22, the environmental impact statement (EIS) criteria in 10 CFR 51.20, the EA criteria in 10 CFR 51.21, and the Office of Nuclear Reactor Regulation (NRR) Office Instruction LIC-203, Revision 4, Procedural Guidance for Preparing Categorical Exclusions, Environmental Assessments, and Considering Environmental Issues, has determined to prepare an EA instead of invoking the categorical exclusions. This determination is based largely on concluding that the submittals (1) are either not covered by the criteria for a CATEX or, in the case of the license transfer request, do not fall within the factual basis underlying the corresponding CATEX; (2) are connected (i.e., interdependent) actions that should be considered together as part of the National Environmental Policy Act (NEPA) review; and (3) are not specifically covered by the criteria for preparing an EIS because the NRC does not yet know the significance of potential impacts from the proposed actions.6 The EA and FONSI comprise new and materially different information.

Following the NRC Staffs announcement that it would not honor Holtecs request for CATEX treatment of the LARs and instead intended to compile an EA, Holtec made no objection of record, nor has it sought interlocutory review of that Staff decision by the Commission. The difference between an ignored or overruled or negated CATEX request, and a FONSI, which is a formal decision made by the agency after compilation of an EA, is considerable. While the NRC 6 Id.

5 https://adamswebsearch2.nrc.gov/webSearch2/main.jsp?AccessionNumber=ML24149A002 earlier stage of the Palisades proceedings were not rendered nugatory by subsequent NRC compilation of an EA.

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conclusion not to compile an EIS agrees in some sense that an EIS is not required, the very fact of writing an EA contradicts Holtec. The CATEX requests thus were rendered moot when the NRC Staff opted for an EA more than three months before Petitioners filed their Petition to Intervene. The NRC contradicted, by overruling, the CATEX requests. Holtecs point cannot block amendment of Contention 2.

2. Palisades prospective generation of radioactive waste into the 2050s if restarted portends reasonably foreseeable environmental effects which must be addressed in the NEPA document Holtec maintains that sufficient information was available to the Petitioners prior to moving to amend and that the (obvious) fact that operating a nuclear plant produces radioactive waste cannot serve as a basis for now amending their contentions.7 In addition, Holtec asseverates that approval of the LARs would not authorize operations past 2031, and so NRC is not required to consider those future environmental impacts.

There are multiple suggestions in the EA that the NRC Staff took into account Holtecs acknowledged aim of applying for a 20-year operating license extension beyond 2031:

> [P]otential subsequent license renewal in 2031 at Palisades [has] the potential to impact non radiological human health.8

> Subsequent License Renewal Application (Application expected no later than March 26, 2026).9

> The information session included a presentation outlining the proposed project, undertaking and Federal actions, Federal agencies involved, past land disturbance at Palisades, the anticipated area of potential effects, the NRCs environmental review schedule, and potential 9 EA Appx. G, p. G-1.

8 EA p. 3-59.

7 Holtec Answer p. 25.

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future projects at the Palisades site (subsequent license renewal and small modular reactor project) which would be captured in the NRCs cumulative effects review.10

> The actions or projects in the vicinity of Palisades that may affect surface water resources include:... potential subsequent license renewal (SLR) of Palisades.11

> Key past and present actions affecting aquatic resources in the affected area include planned construction of multiple SMRs, expansion of the independent spent fuel storage installation (ISFSI), and the potential subsequent license renewal of Palisades in 2026.12 Under NEPA, an agency must consider those environmental effects that are reasonably foreseeable. 42 U.S.C. § 4332(2)(C)(i). NRC regulations require that Applicants shall provide information about other past, present, and reasonably foreseeable actions occurring in the vicinity of the nuclear plant that may result in a cumulative effect. 10 CFR § 51.53(c)(3)(ii)(O).

The notion of reasonably foreseeable environmental effects has always been essential to NEPA investigation and analysis. In the first major challenge under the new NEPA law, the D.C. Circuit rejected the Atomic Energy Commissions attempt to water down NEPAs requirements, including by limiting consideration of the downstream effects of a nuclear power plant. Calvert Cliffs Coordinating Comm., Inc. v. U.S. Atomic Energy Commn, 449 F.2d 1109, 1122-23 (D.C. Cir. 1971). The court held that environmental issues regulated by other federal, state, or regional bod[ies] must be assessed and weighed in each individual case. Id. at 1123.

Shortly after Calvert Cliffs, the D.C. Circuit held that NEPA plainly contemplates consideration of both the long-and short-range implications to man. Scientists Inst. for Pub.

Info., Inc. v. Atomic Energy Commn, 481 F.2d 1079, 1090 (D.C. Cir. 1973) (quotation marks 12 EA pp.3-41 to 3-42.

11 EA p. 3-19.

10 EA Appx. I, p. I-1.

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omitted). The court also sharply criticized the Commissions attempt to avoid consideration of future effects as contrary to the text and purpose of NEPA. The agency need not foresee the unforeseeable, but [r]easonable forecasting and speculation is... implicit in NEPA, and

[courts] must reject any attempt by agencies to shirk their responsibilities under NEPA by labelling any and all discussion of future environmental effects as crystal ball inquiry. Id. at 1092.

NEPA requires that a federal agency make a good faith effort to predict reasonably foreseeable environmental impacts and that the agency apply a rule of reason after taking a hard look at potential environmental impacts. Public Service Co. of Oklahoma (Black Fox Station, Units 1 & 2), LBP-78-26, 8 NRC 102, 141 (1978).

Petitioners wholly disagree with Holtecs argument that radioactive waste management and environmental effects during the subsequent licensing period from 2031-2051 need not be covered by the pending NEPA document. Holtecs oft-repeated expressions of that intention easily surpasses the reasonably foreseeable threshold in the NEPA statute. The production of many tons of radioactive waste for almost 30 years into the future - waste that will be hotter because it is higher-enriched, stored on concrete pads which have previously been questioned for failure to meet NRC seismic standards, and also on a planned new concrete storage pad13-- poses significant direct environmental impacts and requires cumulative effects analysis. Moreover, 10 C.F.R. Part 50, Appx. S, and 10 C.F.R § 72.103 both require assessment of earthquake potential, and the EA contains no seismic discussion. Certainly, the effects of an earthquake on a nuclear facility and its nearby irradiated fuel storage pads built on shifting sands implicate significant potential impacts and therefore must be addressed within an EIS.

13 EA, pp. 3-19 and 3-34.

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Radioactive waste generation, management, storage and its environmental effects through 2051 must be addressed in the NEPA compilation, as they are reasonably foreseeable direct, indirect and cumulative effects of the project.

REPLY IN SUPPORT OF AMENDED CONTENTION 4 The crux of the amended Contention 4 is the inclusion in the EA of a discussion of the impacts of climate change. NRC Staff admitted in its Answer to the original Contention 4 that the discussion of climate change in Holtecs application documents was insufficient. NRC Staff and Holtec now claim that Petitioners have not satisfied the requirements for raising an amended contention.

Although the amended Contention 4 does not change the overarching statements and arguments in the original Contention 4, it does address new information that is presented in the EA. Petitioners had no basis for addressing this new information until it was included in the EA.

A contention must show a dispute with the EA and point to the specific parts of the EA that are in dispute.14 So NRC Staff and Holtec are trying to put Petitioners in a Catch 22 situation. We must attack the information in the EA, but we cant do that until the EA is published. At the same time, NRC Staff and Holtec argue that Petitioners should have attacked the new information before it was published in the EA.

Furthermore, it was not Petitioners obligation, as Holtec seems to suggest,15 to respond to information that Petitioners had no reason to believe was relevant until it was relied on in the EA.

Whats new has nothing to do with whether the Petitioning Organizations knew or should have known about 2021 NOAA data, it's that the Staff found the NOAA data relevant to its presentation in the EA respecting climate change. That is, the Staff actually did the research 15 Holtec Answer, p. 39.

14 Texas Utilities Co. (Comanche Peak Steam Electric Station), 36 NRC 370 (1992) 10

that Holtec neglected to do in its non-ER ER, using widely-available public tools that long predate the intervention deadline. The NOAA data is new because it was first deemed relevant by the NRC Staff, not Holtec, and because it appears in the EA for the first time and not the ad hoc ER.

The petitioner may be permitted to file new or amended contentions based on material, new information contained in subsequent NRC environmental documents. 10 C.F.R. § 2.309(f)(2) (formerly § 2.714(b)(2)(iii)). Sacramento Municipal Utility District (Rancho Seco Nuclear Generating Station), CLI-93-3, 37 NRC 135, 154 (1993). Such new information, though, must differ significantly from the information provided in the environmental report, and these differences must be material to the outcome of the proceeding. Exelon Generation Co. (Early Site Permit for Clinton ESP Site), LBP-05-19, 62 NRC 134, 163 (2005). Since the NOAA data differs significantly from the rank silence on climate change in the ad hoc ER and is material to the outcome of the proceeding in that climate change must be addressed in the EA, Petitioning Organizations have properly amended Contention 4.

Beyond challenging Petitioners right to file an amended contention, NRC Staff and Holtec simply rely on the arguments made in their Answers to the original Contention 4.

Therefore, no further reply is necessary regarding the admissibility of the amended contention.

Because amended Contention 4 satisfies the good cause requirement for filing an amended contention, and the new information confirms and supports the original Contention 4, the amended contention should be admitted for hearing.

REPLY IN SUPPORT OF AMENDED AND SUBSTITUTED CONTENTION 5

1. The RAI response on purpose and need demonstrates contradictions between Holtecs application and the EA purpose and need statement 11

Both the NRC Staff and Holtec maintain that Holtecs October 2024 response to a Request for Additional Information, in which Holtec provided a statement of purpose and need in response to an NRC interrogatory, scuttles Petitioners proposed amended contention that the EA purpose and need statement is insufficient.16 This is incorrect.

Petitioners maintain that the RAI response was tentative and that the only way to provide new information that was omitted from an ER is in a revised ER, not a response to an RAI.

Florida Power & Light Co. (Turkey Point Nuclear Generating Units 3 & 4), 90 NRC 17, 21 (2019):

A contention of omission claiming that an ER fails to include required information can be cured by the applicant supplying the missing information in a revised ER or by the NRC Staff supplying the missing information in an environmental impact statement (EIS).

Holtec has never provided a document as part of the restart application denominated as an Environmental Report (ER). The NRC unilaterally designated a Holtec writing that sets forth discussions of some of the potential environmental circumstances of the restart as an ER.

Petitioners, in order to advance their intervention, objected to this unilateral designation and having preserved the objection, proceeded to critique the environmental document as an ER. But since Holtecs environmental document was not an ER, there is no ER to revise. Petitioners are being held to the strictest standard of compliance with NRC regulations, whereas Holtec is protectively prodded by the NRC Staff to comply in fits and starts with NRC regulations pertaining to NEPA requirements. Such double standards are unacceptable and improper.

The NRC Staff cited a Commission decision:

16 From Holtec Answer p. 49: The only question for purposes of 10 CFR 2.309(c) is whether Petitioning Organizations were free to ignore the Environmental RAI Response that supplied the purpose and need statement on October 4, 2024. They were not.

From NRC Staff Answer p. 46: However, as the Staff stated in its answer to original Contention 5, Petitioning Organizations contention was moot because in October 2024, Holtec supplied a purpose and need statement in an RAI response as a supplement to its application.

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It is well recognized that where a contention based on an applicant's environmental report is superseded by the subsequent issuance of licensing-related documents whether an environmental impact statement or an applicant's response to a request for additional information the contention must be disposed of or modified.17 But this statement is dicta, a pronouncement that was irrelevant to the underlying decision. On appeal to the Commission in USEC, the intervenor was advised by the NRC Staff that a contention based on an ER was going to be partially adopted in the subsequent EA. Though he was on notice of the impending EAs publication, the intervenor-appellant never bothered to amend his contention and could not take up the issue of amendment on appeal. The above-quoted verbiage was irrelevant to the Commissions ultimate ruling; it was dicta.

To summarize, the NRC Staff has stated that the pathway to restart doesnt require an ER, but just in case, it designated a fragmentary Holtec environmental disclosure as a putative ER.

But if its gratuitous, then Holtec's response to the RAI was also gratuitous.

Moreover, the NRC stated in its RAI request that it was based on a Council on Environmental Quality (CEQ) regulation, specifically 40 CFR § 1501.5. As the ASLB is aware, the CEQ regulations were completely revoked by the Council in February 2025.18 The NRC Staff has created issues of fact by the admission of counsel that there is no requirement for an ER to be provided. The RAI response, based on a since-revoked CEQ regulation, is doubly gratuitous.

Consequently, the first and only point in this proceeding that a purpose and need statement was mandatorily provided to the public and the Petitioners occurred with the publication of the EA.

2. Neither invocation of the Energy Policy Act of 2005 nor the Inflation Reduction Act of 2022 suffice to support purpose and need of the Palisades restart Here, the Draft EA sets forth separately the purpose and need for both the NRC 18 https://www.federalregister.gov/documents/2025/02/25/2025-03014/removal-of-national-environ mental-policy-act-implementing-regulations 17 USEC, Inc. (American Centrifuge Plant), CLI-06-9, 63 NRC 433, 444 (2006).

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reauthorization actions and DOEs financial assistance action. The Draft EA asserts the purpose and need of the NRC reauthorization actions is to provide an option that allows for baseload clean energy power generation capability within the term of the Palisades Renewed Facility Operating License (RFOL) to meet current system generating needs, while the purpose and need for the DOE action is to meet legislative goals in the Energy Policy Act of 2005 and the Inflation Reduction Act of 2022 to finance projects and facilities in the United States that retool, repower, repurpose, or replace energy infrastructure that has ceased operations. Nowhere is the legislative goal of compliance with the Atomic Energy Act nor the cobbling together of a pathway to restart of Palisades mentioned as a purpose and need. Given the unique nature of this undertaking and the need for thorough consideration of all reasonable alternatives, it isnt possible to take the EA statements seriously. See ELPC v. NRC, 470 F.3d 676, 683 (7th Cir. 2006),

quoting Simmons v. Corps of Engineers, 120 F.3d 664, 666 (7th Cir. 1997) (NEPA requires an agency to exercise a degree of skepticism in dealing with self-serving statements from a prime beneficiary of the project and to look at the general goal of the project rather than only those alternatives by which a particular applicant can reach its own specific goals.); also, Citizens Against Burlington, Inc. v. Busey, 938 F.2d190, 196 (D.C. Circuit 1991) ([A]n agency may not define the objectives of its action in terms so unreasonably narrow that only one alternative from among the environmentally benign ones in the agencys power would accomplish the goals of the agencys action...).

Although a purpose and need can be based on clear Congressional intent, see Busey,19 neither the NRC Staff nor Holtec have presented any clear Congressional intent to restart closed, decommissioning nuclear reactors. It is beyond cavil that there is no express provision within the 19 938 F.2d at 196 (always consider the views of Congress, expressed, to the extent that the agency can determine them, in the agencys statutory authorization to act, as well as in other congressional directives.

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Atomic Energy Act that authorizes restart, as evidenced by the ad hoc smorgasbord approach being taken with respect to Palisades. The purpose and need statement in the EA does not mention an AEA Congressional directive. As Petitioners explained in the Amended Contention 5:

[T]he purpose and need statement in the EA says the purpose and need is to provide energy within the term of the Palisades RFOL to meet current system generating needs. That clearly means that the purpose and need is to reauthorize the Palisades license for power operations. Of course, that leaves only one alternative to satisfy that alleged purpose and need. It leaves no possibility of reasonably examining any other alternative.20

3. Holtec has conclusively demonstrated issues of fact warranting adjudication While urging that Petitioning Organizations offer only unsupported assertions questioning need that do not create a genuine factual dispute with the Draft EA, Holtec has graciously provided issues of fact underscoring the need for an adjudication of the need for power from a restarted Palisades. At p. 57, fn. 254 of the Holtec Answer, the applicant details at length - for the very first time - some allegations that should be tested at trial. Besides quoting from politicians letters in the footnote, wherein they proclaimed to one another about the bounties that would befall Michigan were Palisades to rejoin the regional power grid, Holtec also reveals that the Michigan Public Service Commission intervened in support of the restart in formal comments made to the Federal Energy Regulatory Commission (FERC). The PSC ostensibly stated that [t]he recommissioning of the Palisades Nuclear Plant is key to improving Michigans resource adequacy during a period marked by widespread retirements of dispatchable generation.

Everyone on the side of reopening Palisades seems to speak and write intuitively of a great need for power from Palisades, a need that is assumed to be so commonly understood that 20 Petitioners New and Amended Contentions, p. 29 (March 3, 2025).

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there is resentment from some quarters when substance, and not empty cheerleading rhetoric, is sought. Holtec has now directed the ASLBs attention to an actual regulatory proceeding that might have addressed the question of need for power from a restarted Palisades. Finally, six months after Petitioners first asked their questions, Holtec has conceded the existence of factual issues necessitating inquiries into the purpose and need for Palisades and the legitimacy of the truncated discussion of alternatives to the restart. There are issues of fact for trial, thanks to Holtec. The ASLB may properly admit Contentions 5 - and 6, too, in light of these new facts -

for adjudication.

REPLY IN SUPPORT OF AMENDED AND SUBSTITUTED CONTENTION 6

1. Holtecs RAI response discussing alternatives does not bar contention admissibility Both the NRC Staff and Holtec maintain that Holtecs October 2024 response to a Request for Additional Information, in which Holtec provided some discussion of alternatives in response to an NRC interrogatory, undermines Petitioners proposed amended contention alleging deficiencies in the alternatives analysis. This is not correct.

Petitioners maintain that the only way to provide new information that was omitted from an ER is in a revised ER, not a response to an RAI. Florida Power & Light Co. (Turkey Point Nuclear Generating Units 3 & 4), 90 NRC 17, 21 (2019).

Holtec has never provided a document as part of the restart application denominated as an Environmental Report (ER). The NRC unilaterally designated a Holtec writing that sets forth discussions of some of the potential environmental circumstances of the restart as an ER.

Petitioners, in order to advance their intervention, objected to this unilateral designation and having preserved the objection, proceeded to critique the environmental document, treating it as an ER because it was the only environmental document proffered for public scrutiny by the NRC 16

Staff. And since Holtecs environmental document was not an ER, there is no ER to revise. As previously observed, the Petitioners are here being held to the strictest standard of compliance with NRC regulations, whereas Holtec is protectively prodded by the NRC Staff to comply in fits and starts with the NRCs NEPA regulations. Such double standards are unacceptable and improper.

To summarize, the NRC Staff maintains that the pathway to a Palisades restart doesnt require an ER. Just in case their judgment as to that point is shown to be incorrect, the Staff has gratuitously designated Holtecs fragmentary environmental disclosure document as a putative ER. But if its gratuitous, then Holtec's response to the RAI was also gratuitous, which makes the publication of the EA the first time a NEPA document formally revealed alternatives for consideration. The Petitioners have timely sought amendment of their original Contention 6, and in doing so, have demonstrated the existence of issues of fact between Holtecs putative ER and the EA such as warrants admission of Contention 6.

2. Deficiencies and discrepancies in Holtecs and NRC discussions of alternatives There were some consistencies, but at least one major difference, between the Holtec RAI response on alternatives and the NRC Staffs Environmental Assessment. Holtec rejected demand-side management, which it defined as energy conservation and efficiency measures because the NRC staff is not aware of any cases where demand side management programs have been implemented expressly to replace or offset a large, baseload generation station.21 Notably, the NRC Staff didnt discuss the alternatives of energy conservation or demand-side management in the EA.

Because of its pledge that Palisades will hold to an availability date of October 2025, 21 Palisades RAI, ADAMS No. ML24278A027, p. 83/313 of pdf.

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Holtec concluded that development of new generation sources is not feasible.22 Nowhere in the RAI response did Holtec explain how the regional grid has done without power from Palisades for more than 2 years, nor is there any data-derived projection of the prospective need for power from the plant.

In the EA, the NRC Staff noted that Holtec has not indicated how the energy demand underlying the purpose and need would be met for the power that would have otherwise been generated by resuming operations at Palisades.23 As with the RAI response, the EA provides no data nor explication of the claimed underlying demand there is for power from a plant that departed the regional grid in 2022 without causing an electricity crisis. The terms energy conservation and demand-side management appear nowhere in the EA discussion of alternatives. The NRC Staff concludes in the EA that building new facilities would result in additional environmental impacts related to land disturbance and use of construction equipment.

These impacts would be greater than those needed to put the already built Palisades facilities back into operation.24 Both Holtec and the NRC Staff appear not to understand the thrust of Petitioners criticisms of their alternatives discussions. Holtec rejected new-build alternatives on grounds that nothing would be available by October 2025 when Palisades is imagined to return to service.

Holtec further rejected demand-side efforts and conservation because of an unverifiable statement suggesting that the NRC was not supportive of considering such to be a bona fide alternative to restart. The NRC staff rejects all new-build options because everything will have greater environmental impacts than a restart.

24 EA p. 4-6.

23 EA p. 2-7.

22 Id.

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The Petitioners point out that there is no disclosure anywhere in these two writings that explains how Michigan and surrounding recipient states have survived since May 2022 without power from Palisades. Petitioners further criticize the approach that both Holtec and the Staff have taken, which is that the alternatives must be capable of fully replacing the base load levels of power from Palisades or they cannot be considered. Finally, Petitioners have asked why incremental provision of power from alternative sources isnt considered, i.e., instead of having to immediately provide a plan for 800 megawatts-electric (Mwe) from alternative sources, Petitioners have postulated an alternative consisting of in-fill energy development using solar, wind and large-scale conservation, as well as efficiency upgrades, to address incremental demand growth. Tellingly, the NRC Staff fails even to consider the demand-side option Holtec briefly mentions. This differs significantly from the information provided in the putative ER (which contained no discussion of alternatives) and the Holtec RAI. Exelon Generation Co. (Early Site Permit for Clinton ESP Site), LBP-05-19, 62 NRC 134, 163 (2005). Something is better than nothing, so the availability of new information on an issue where there previously was none, fulfills the requirement that late contentions be based on materially different information in 10 C.F.R. § 2.309(f)(2)(ii). Entergy Nuclear Vermont Yankee, L.L.C. and Entergy Nuclear Operations, Inc. (Vermont Yankee Nuclear Power Station), LBP-05-32, 62 NRC 813, 820 (2005).

Holtec maintains, however, that the NEPA amendments of 2023 made the Environmental Assessment option statutory but that the NEPA statute still does not require an EA to contain an analysis of alternatives. Holtec additionally argues that the NRC long ago created its own regulatory expectations for the discussion of alternatives within an EA, which, Holtec claims, do not precisely track the requirements within the NEPA statute for discussing alternatives.25 The circuitous explanation Holtec provides, however, is flawed. NRCs regulations provide that EAs 25 Holtec Answer, pp 63-64.

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shall identify the proposed action and include [] Alternatives as required by section 102(2)(E) of NEPA[,] and discuss [t]he environmental impacts of the proposed action and alternatives as appropriate, citing 10 CFR 51.30(a)(1)(ii), (iii). Contrary to Holtecs position that the NRC adaptation of the disclosure of alternatives in Environmental Assessments, the language of NEPA

§ 102(2)(E), which now appears as § 102(H), provides that federal agencies will study, develop, and describe appropriate alternatives to recommended courses of action in any proposal which involves unresolved conflicts concerning alternative uses of available resources[.] 42 U.S.C. § 4332(H). In promulgating its own NEPA compliance regulations, the Nuclear Regulatory Commission chose to have EA discussions of alternatives to a proposed project meet the same standard that NEPA requires for alternatives discussions in Environmental Impact Statements.

Accordingly, federal courts pronouncements regarding expectations for identification and disclosure of alternatives logically must be treated by the NRC as highly persuasive. Hence the discussion and evaluation of alternatives, in a NRC EA, is the linchpin of the NEPA requirement. Monroe County Conservation Council, Inc. v. Volpe, 472 F.2d 693 (2d Cir. 1972).

Agencies must, to the fullest extent possible, [s]tudy, develop, and describe appropriate alternatives to recommended courses of action in any proposal... 42 U.S.C. § 4322(2)(E);

Idaho Conservation League v. Mumma, 956 F.2d 1508, 1519-20 (9th Cir. 1992). There must be examination of every alternative within the nature and scope of the proposed action, California

v. Block, 690 F.2d 753, 761 (9th Cir. 1982), sufficient to permit a reasoned choice.

The discussion of alternatives must be a serious investigation and analysis of all reasonable alternatives, and not merely a justification for the proposed project. Moreover, the no-action alternative must be given adequate discussion and cannot be rejected just because it does not satisfy the alleged purpose and need for the project. Western Watersheds Project v.

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Abbey, 719 F.3d 1035 (9th Cir. 2013); North Carolina Wildlife Federation v. North Carolina Dept. of Transp., 677 F.3d 596 (4th Cir. 2012); Southeast Alaska Conservation Council v. Fed.

Highway Admin., 649 F.3d 1050 (9th Cir. 2011). Deference [to the agencys identification of alternatives], however, does not mean dormancy, and the rule of reason does not give agencies license to fulfill their own prophecies, whatever the parochial impulses that drive them. Citizens Against Burlington, Inc. v. Busey, 938 F.2d 190, 196 (D.C. Circuit 1991). The alternatives analysis in the EA clearly does not satisfy the standards for a rigorous discussion of alternatives and Petitioners Contention 6 must be adjudicated.

REPLY IN SUPPORT OF NEW CONTENTION 8 The essence of this contention is that the decision in the EA was to rely on incorporation by reference of certain documents into the EA by applying CEQ regulations, in lieu of relying on the inclusion of the text of those documents within the four corners of the EA. Those incorporations by reference based on CEQ regulations are legally flawed because the CEQ regulations were illegally promulgated. NRC Staff has responded by claiming that there is no basis for this contention because the NRC is an independent agency and was never subject to CEQ regulations that were promulgated on the basis of an executive order.

But the NRC made itself subject to the CEQ regulations authorizing incorporation by reference. The EA states, the NRC staff adhered to three principles, identified in CEQ regulations in 40 CFR 1501.12 (40 CFR Part 1501-TN4876).26 While Holtec attempts to fix things by citing to an NRC regulation that appears to allow reliance on earlier NEPA documents,27 that is a post hoc rationale. The grounds upon which the agency acted in exercising 27 Holtec Answer p. 75, fns. 333, 334.

26 EA, p. 1-7. The actual proper citation is the 40 CFR § 1501.21; the EA incorrectly cites it as § 1501.12.

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its powers were not those upon which its action can be sustained. SEC v. Chenery Corp., 318 U.S. 80, 95, 63 S.Ct. 454, 87 L.Ed. 626 (1943).

Whether the NRC is subject to the CEQ regulations is not the point. The point is that it was improper for the NRC to base a significant aspect of the preparation of the EA on invalid regulations, whether those regulations applied directly to the NRC or not. In fact, it could be argued that it was even more egregious to rely on the CEQ regulations if the regulations did not apply to the NRC in the first place.

In addition, Holtec claims that Contention 8 is untimely, but it is not clear what the basis of that claim is. The first time there was any indication that the EA would rely on CEQ regulations to incorporate by reference other documents was when the EA was issued. By stipulation of the parties, and affirmed by the ASLB, Petitioners were granted until March 3, 2025, to file new or amended contentions, based on the date the EA was issued.

Holtec apparently argues that the Federal Register notice regarding the environmental process for this case28 mentioned the 2006 license renewal SEIS. But that is hardly the clear statement in the EA that the 2006 SEIS, as well as other documents, would simply be incorporated by reference. It was not until the Petitioners reviewed the EA itself that the reliance on CEQ regulations was apparent. It is clear that Holtec is not making a serious argument on this point.

Holtecs assertion that [a]n appeals court ruling does not constitute new information on which a party can file a new contention29 is also unavailing. The first opportunity the Petitioners had to raise this objection was with the publication of the EA on January 31, 2025 and they timely did so on March 3, 2025, in a legal landscape wherein the CEQ regulations had been 29 Holtec Answer, fn. 327, citing Nuclear Mgmt. Co., LLC (Palisades Nuclear Plant), CLI-07-9, 65 NRC 139, 142 (2007).

28 Holtec Answer, fn. 326.

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nullified, and, on February 25, 2025, revoked by the Council on Environmental Quality. While perhaps a court decision is not in and of itself grounds for a new contention, a court decision that has curtailed long standing legislative regulations such that they cannot lawfully be relied upon is part of a set of facts that does, indeed, comprise changed circumstances and that creates an issue of fact for hearing.

Holtec also argues that if incorporation by reference is not allowed, the page limitations in the 2023 amendments to NEPA30 will be violated. A prohibition on incorporation by reference does not mean that the entire document referred to must be reproduced in the EA. It just means that the document must be summarized and discussed so it can be properly evaluated in the EA.

This is a thin excuse, in any event, because the statute limiting the length of NEPA documents contains no penalty if page limits are exceeded. And there are unlikely to be complaints from the public where an agency provides more information, rather than less.

The EA is seriously flawed because of these impermissible incorporations by reference.

The standards for a new, late-filed contention have been met and Contention 8 should be admitted for adjudication.

CONCLUSION The NRC Staff and Holtec have conjured up unreasonably rigorous standards they claim the Petitioners must meet, and have allegedly failed to meet, regarding the admissibility of these amended and new contentions. Petitioners respectfully request that this Board not be persuaded by the Staffs and Holtecs arguments and allow the amended and new contentions to be admitted for hearing.

30 42 U.S.C. 4336b(e).

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April 4, 2025

/s/ Wallace L. Taylor Wallace L. Taylor, Esq.

4403 1 Ave. S.E., Suite 402 Cedar Rapids, Iowa 52402 319-366-2428; (Fax)319-366-3886 wtaylorlaw@aol.com

/s/ Terry J. Lodge Terry J. Lodge, Esq.

316 N. Michigan St., Ste. 520 Toledo, OH 43604-5627 (419) 205-7084 tjlodge50@yahoo.com Co-Counsel for Beyond Nuclear, Michigan Safe Energy Future, Dont Waste Michigan, Three Mile Island Alert and Nuclear Energy Information Service CERTIFICATE OF SERVICE Pursuant to 10 CFR § 2.305, I hereby certify that a copy of the foregoing PETITIONING ORGANIZATIONS REPLY IN SUPPORT OF AMENDED AND NEW CONTENTIONS was served upon the Electronic Information Exchange (NRC Filing System) in the captioned proceeding this 4th day of April, 2025 and that according to the protocols of the EIE they were served upon all parties registered with the system.

Respectfully submitted,

/s/ Terry J. Lodge Terry J. Lodge, Esq.

Co-Counsel for Petitioning Organizations 24