with minimum environmental effects in compliance with these guidelines. The design effort will be supported by a strong research and development program with significant emphasis on proof testing.

Major objectives will be to (1) demonstrate the technical performance, reliability, maintainability, safely, environmental acceptability and economic feasibility in a utility environment of an LMFBR central electric power station and (2) confirm the value of this concept for conserving important non-renewable natural resources. Accordingly, the manner in which the demonstration plant is operated, after the initial period of start-up and testing, will be as similar as practicable to the commercial LMFBR plants that are expected to be in operation in the 1980's.

Although the specific design for the first demonstration plant has not been selected on a firm basis, it is expected that the following several approximate design parameters will be included:

Note: Escalation is calculated at 30% of the cost.

APPENDIX 3

Amendment No. 1 to Memorandum of Understanding Among

United States Atomic Energy Commission, Tennessee Valley Authority,
Commonwealth Edison Company, Project Management Corporation, and

Breeder Reactor Corporation, dated August 7, 1972

The referenced Memorandum of Understanding is hereby amended or implemented in the following respects:

1. The Memorandum contemplates that the principal features of the cooperative arrangements pertaining to the LMFBR Demonstration Plant Project would be set forth in contracts between (1) AEC and PMC; (2) AEC and TVA; (3) AEC and CE; (4) AEC and BRC; (5) PMC and TVA; (6) PMC and CE; and (7) PMC and BRC. In the course of negotiation of definitive contracts the parties have consolidated the number of agreements into two contracts. Parties to the first contract are AEC, CE, TVA and PMC. The second contract is between BRC and PMC. Insofar as such consolidation of contracts is

inconsistent with the Memorandum, the latter is so hereby amended.

2. Paragraphs 3. (c)(3) and (8) of the Memorandum which reserve to AEC, TVA and CE rights of "consultation", "review" and "approval" of Project plans and actions and describe the role of the Project Steering Committee (PSC) as that of providing general policy guidance for the project, are hereby deleted. In lieu thereof, the parties have agreed: (1) that PMC is authorized to manage the Project and to establish general policies for the Project; (2) that AEC will endeavor to secure the necessary legislative authorization to permit two of its officials or employees to

serve on the PMC Board of Directors and to permit up to five AEC employees to serve on the PMC staff; and (3) that until AEC has membership on the PMC Board, the Proiect Steering Committee (PSC) will be empowered to effectively implement management of the Project and administer the Principal Project Agreements subject to rights of review and appeal to the PMC Board and to the heads of AEC, TVA and CE, as more fully defined in the definitive contract between CE, TVA, AEC and PMC. After AEC gains membership on the PMC Board, the PSC membership will be constituted as the Board's Executive

Committee.

3. In addition to the conditions precedent for start of construction stated in paragraph 7. (c) of the Memorandum the following conditions are set forth in the definitive contract: (1) AEC, TVA, CE and PMC shall have agreed in writing that the LMFBR Plant can be built and operated consistent with the provisions and policies of applicable law in respect to the protection of the environment and (2) PMC has supplied TVA with a PMC Board resolution specifying the portions of the site required for the project.

4. Paragraph 3. (c) (7) of the Memorandum provides for agreement in the definitive contracts regarding the Project Activities in which AEC will participate. The definitive AEC, TVA, CE, PMC contract states that AEC will provide the technical supervision of the reactor manufacturer (s) and architect-engineer(s) regarding the nuclear steam supply system of the

Plant.

5. Paragraph 7. (s) of the Memorandum provides the general outline of the indemnification for which AEC will seek legislative authority. The form of the indemnity for which AEC will seek authorization to give is set forth in the definitive contracts.

6. Paragraph 2 of Attachment 9 of the Memorandum provides for arbitration in case of disagreement among the parties regarding whether project termination criteria have been met. AEC will seek legislation or other appropriate confirmation of its authority to arbitrate. Until such authority is obtained, the agreement of at least three of the five parties will be required to establish that any particular project termina

tion criterion has been met.

The definitive contracts among AEC, TVA, CE and PMC and between PMC and BRC will be signed by the parties after this amendment has been submitted to the Joint Committee on Atomic Energy and the requirements of PL 91-273 as amended by PL 92-84 have been fully complied with. Copies of these unexecuted definitive contracts are attached for reference.

Consistent with paragraph 7. (m) of the Memorandum, the parties have determined that there is no additional information available to support a change in the presently estimated cost of the Demonstration Plant as shown in Attachment 10 to the Memorandum and will so stipulate upon execution of the definitive contracts.