3F0318-01, Annual Decommissioning and Irradiated Fuel Management Financial Status Report for 2017

Annual Decommissioning and Irradiated Fuel Management Financial Status Report for 2017

ML18086A188
Person / Time
Site:	Crystal River
Issue date:	03/26/2018
From:	Hobbs T Duke Energy Florida
To:	Document Control Desk, Office of Nuclear Material Safety and Safeguards, Office of Nuclear Reactor Regulation
References
3F0318-01
Download: ML18086A188 (9)

Text

Crystal River Nuclear Plant 15760 W. Power Line Street Crystal River, FL 34428 Docket 50-302 Docket 72-1035 Operating License No. DPR-72 10 CFR 50.82 10 CFR 50.75 March 26, 2018 3F0318-01 U.S. Nuclear Regulatory Commission Attn: Document Control Desk Washington, DC 20555-0001

Subject:

Crystal River Unit 3 - Annual Decommissioning and Irradiated Fuel Management Financial Status Report for 2017

References:

1. NRC to CR-3 letter dated March 13, 2013, Crystal River Unit 3 Nuclear Generating Plant Certification of Permanent Cessation of Operation and Permanent Removal of Fuel from the Reactor (ADAMS Accession No. ML13058A380)

2. CR-3 to NRC letter dated December 2, 2013, Crystal River Unit 3 - Post-Shutdown Decommissioning Activities Report (ADAMS Accession No. ML13340A009)

3. NRC to CR-3 letter dated January 26, 2015, Crystal River Unit 3 Nuclear Generating Plant - Exemptions from the Requirements of 10 CFR Part 50, Sections 50.82(a)(8)(i)(A) and 50.75(h)(2) (ADAMS Accession No. ML14247A545)

4. NRC to CR-3 letter dated March 11, 2015, Crystal River Unit 3 Nuclear Generating Plant Post-Shutdown Decommissioning Activities Report (ADAMS Accession No. ML14321A751)

5. NRC to CR-3 letter dated August 10, 2016, Crystal River Unit 3 Nuclear Generating Plant - Order Approving Transfer and Conforming Amendment (ADAMS Accession No. ML16173A019)

Dear Sir:

In accordance with 10 CFR 50.75(f)(1), 10 CFR 50.82(a)(8)(v), 10 CFR 50.82(a)(8)(vi), and 10 CFR 50.82(a)(8)(vii), Duke Energy Florida, LLC, (DEF) is submitting the annual status of decommissioning funding, status of funding for managing irradiated fuel, and the financial assurance status report for 2017. In Reference 1, the NRC acknowledged Crystal River Unit 3 Nuclear Generating Plant (CR-3) certification of permanent cessation of power operation and permanent removal of fuel from the reactor vessel. In Reference 2, DEF submitted its Post-Shutdown Decommissioning Activities Report (PSDAR) containing a site-specific Decommissioning Cost Estimate (DCE) pursuant to 10 CFR 50.82(a)(4)(i) and 10 CFR 50.82(a)(8)(iii). Accordingly, a status of decommissioning funding pursuant to 10 CFR 50.75(f)(1), a financial assurance status report pursuant to 10 CFR 50.82(a)(8)(v) and 10 CFR 50.82(a)(8)(vi), and a report on the status of the funding for managing irradiated fuel pursuant to 10 CFR 50.82(a)(8)(vii) are required to be submitted by March 31 of each year.

U. S. Nuclear Regulatory Commission Page 2 of 3 3F0318-01 In Reference 3, the NRC provided its approval of the CR-3 exemption request to use the funds from the CR-3 Decommissioning Trust Funds for Irradiated Fuel Management and Site Restoration Costs. The financial assurance demonstration performed in this submittal has been prepared consistent with that exemption request. In Reference 4, the NRC found that the PSDAR contained the necessary information required by 10 CFR 50.82(a)(4)(i) and was consistent with the guidance of Regulatory Guide 1.185.

In Reference 5, the NRC approved a license transfer of the 1.6994 percent combined ownership share in CR-3 held by Seminole Electric Cooperative, Inc. co-owner to DEF. This leaves DEF as the sole owner of CR-3.

The attachments to this letter contain the information required by the above regulations for DEF.

The report contains the following required information:

(1) The amount of decommissioning funds estimated to be required pursuant to 10 CFR 50.75(b) and (c), (While DEF is identifying this amount because it is specified in 10 CFR 50.75(f)(1), it does not appear applicable to a plant that has permanently ceased operation, has submitted a site specific cost estimate, and is engaged in decommissioning.)

(2) The amount of decommissioning funds accumulated to the end of the calendar year preceding the date of this report, (3) A schedule of annual amounts remaining to be collected, (4) The assumptions used regarding rates of escalation in decommissioning costs, rates of earnings on decommissioning funds, and rates of other factors used in funding projections, (5) Any contracts upon which the licensee is relying pursuant to 10 CFR 50.75(e)(1)(v),

(6) Any modifications occurring to a licensees current method of providing financial assurance since the last submitted report, (7) Any material changes to trust agreements or financial assurance contracts, (8) The amount spent on decommissioning, both cumulative and over the previous calendar year, (9) The remaining balance of any decommissioning funds, (10) The amount provided by other financial assurance methods being relied upon, (11) An estimate of the costs to complete decommissioning, reflecting any difference between actual and estimated costs for work performed during the year, (12) The decommissioning criteria upon which the estimate is based, (13) If the sum of the balance of any remaining decommissioning funds, plus earnings on such funds calculated are not greater than a 2 percent real rate of return, together with the amount provided by other financial assurance methods being relied upon, does not cover the estimated costs to complete the decommissioning, the financial assurance status report must include additional financial assurance to cover the estimated cost of completion, (14) The amount of funds accumulated to cover the cost of managing the irradiated fuel, (15) The projected cost of managing irradiated fuel until title to the fuel and possession of the fuel is transferred to the Secretary of Energy, and (16) If the funds accumulated do not cover the projected cost (of irradiated fuel), a plan to obtain additional funds to cover the cost.

U.S. Nuclear Regulatory Commission Page 3 of 3 3F0318-01 The adjustment factors for labor rates and energy costs used in Item (1) for the calculation in 10 CFR 50.75(c)(2) are determined using the December 2017 indices from the U.S. Department of Labor, Bureau of Labor Statistics. The adjustment factor for the cost of low-level waste burial charges used in Item (1) for the calculation in 10 CFR 50.75(c)(2) is determined using NUREG-1307, Revision 16, "Report on Waste Burial Charges."

There are no new regulatory commitments associated with this letter.

l If you have any questions regarding this submittal, please contact Mr. Mark Van Sicklen, Licensing Lead, Nu lear Regulatory Affairs, at (352) 501-3045.

,~/~-

Sincerely, Terry Hobbs General Manager, Decommissioning TDH/mvs Attachments:

Attachment 1 - Duke Energy Florida, Crystal River Unit 3 Funding Status Report Attachment 2 - Crystal River Unit 3, Estimate of Costs to Complete Decommissioning and Financial Assurance Demonstration xc: NMSS Project Manager Regional Administrator, Region I

DUKE ENERGY FLORIDA, LLC DOCKET NUMBER 50 - 302 / LICENSE NUMBER DPR - 72 ATTACHMENT 1 DUKE ENERGY FLORIDA, CRYSTAL RIVER UNIT 3 FUNDING STATUS REPORT

Attachment 1, Page 1 of 2 NRC Decommissioning Funding Status Report Report Dated as of December 31, 2017 Duke Energy Florida Crystal River Unit 3 100% Ownership Crystal River Item # Unit 3 10 CFR 50.75(f)(1) - Status of decommissioning funding 1 1a. The amount of decommissioning funds estimated to be required pursuant to 10 CFR 50.75(b) and (c); $ 460,871,428 1

1b. The amount of decommissioning funds estimated to be required for $ 828,750,155 remaining License Termination costs.

2,3 2 The amount of decommissioning funds accumulated to the end of the $ 742,895,306 calendar year preceding the date of the report; 3 A schedule of the annual amounts remaining to be collected; None 4

4 The assumptions used regarding rates of escalation in decommissioning inflation 2.8%

4 costs, rates of earnings on decommissioning funds, and rates of other qualified rate of return 5.10%

factors used in funding projections; 5 Any contracts upon which the licensee is relying pursuant to None paragraph 10 CFR 50.75(e)(1)(v);

6 Any modifications occurring to a licensee's current method of providing None financial assurance since the last submitted report; and 7 Any material changes to trust agreements. None 10 CFR 50.82(a)(8)(v) - Financial assurance status report 5

8 (A) The amount spent on decommissioning, both cumulative and over the $ 11,100,929 - Previous calendar year previous calendar year, 6

$ 78,756,081 - Cumulative 2,3 9 The remaining balance of any decommissioning funds, and $ 742,895,306 10 The amount provided by other financial assurance methods being relied upon; None 11 (B) An estimate of the costs to complete decommissioning, reflecting any See Attachment 2 difference between actual and estimated costs for work performed during the year, and 12 The decommissioning criteria upon which the estimate is based; Unrestricted Release 13 (C) Any modifications occurring to a licensee's current method of providing financial assurance since the last submitted report; and None 14 (D) Any material changes to trust agreements or financial assurance contracts. None 10 CFR 50.82(a)(8)(vi) 15 If the sum of the balance of any remaining decommissioning funds, plus As demonstrated in Attachment 2, funds accumulated earnings on such funds calculated at not greater than a 2 percent real rate of cover estimated cost of completion.

return, together with the amount provided by other financial assurance methods being relied upon, does not cover the estimated cost to complete the decommissioning, the financial assurance status report must include additional financial assurance to cover the estimated cost of completion.

10 CFR 50.82(a)(8)(vii) - Report on the status of funding for managing irradiated fuel 16 (A) The amount of funds accumulated to cover the cost of managing the irradiated fuel; As demonstrated in Attachment 2, funds accumulated cover estimated cost of completion.

17 (B) The projected cost of managing irradiated fuel until title to the fuel See Attachment 2 and possession of the fuel is transferred to the Secretary of Energy; and 18 (C) If the funds accumulated do not cover the projected cost, a plan to obtain As demonstrated in Attachment 2, funds accumulated additional funds to cover the cost. cover projected cost of managing irradiated fuel, with the noted exception of DEF's portion of ISFSI capital construction costs as described in the update to Irradiated Fuel Management Program pursuant to 10CFR50.54(bb) (ADAMS Accession No. ML13440A008).

Footnotes next page

Attachment 1, Page 2 of 2 Footnotes:

1 Total amount of License Termination costs (Column A) in Attachment 2.

2 Amount is net of 2017 tax obligations.

3 Represents (a) the full fund balance of DEF's qualified and non-qualified decommissioning funds, which, in accordance with the NRC exemption request approval (ADAMS Accession No. 14247A545), can also be used for Spent Fuel Management and Site Restoration costs, and (b) 100% of the funds held by the City of Tallahassee on behalf of DEF, which pursuant to NRC order (ADAMS Accession No. ML020670117) will only be used for NRC radiological decommissioning.

4 Represents values approved by the Florida Public Service Commission in Order No. PSC-14-0702-PAA-EI, issued December 22, 2014, which became effective and final pursuant to Order No. PSC-15-0067-CO-EI, issued on January 23, 2015.

5 Represents the amount actually disbursed from the fund in calendar year 2017 for License Termination costs, not the costs incurred in calendar year 2017. The Note applicable to Column A in Attachment 2 identifies the total amount of 2017 License Termination costs that have not been disbursed from the funds as of December 31, 2017.

6 Represents the cumulative amount actually disbursed from the fund as of December 31, 2017 for License Termination costs, not the cumulative costs incurred as of December 31, 2017. The Note applicable to Column A in Attachment 2 identifies the total amount of 2017 License Termination costs that have not been disbursed from the funds as of December 31, 2017.

DUKE ENERGY FLORIDA, LLC DOCKET NUMBER 50 - 302 / LICENSE NUMBER DPR - 72 ATTACHMENT 2 CRYSTAL RIVER UNIT 3, ESTIMATE OF COSTS TO COMPLETE DECOMMISSIONING AND FINANCIAL ASSURANCE DEMONSTRATION

Attachment 2, Page 1 of 2 Crystal River Unit 3 Attachment 2 - Financial Assurance Demonstration December 31, 2017 Column A Column B Column C Column D Column E Column F Annual Expenses Annual expenses Annual expenses Total Expenses Projected Earnings End-of-year Fund Balances Annual Earnings on All Owners License Termination Decommissioning Trust Decommissioning Trust Fund Cost Spent Fuel Cost Site Restoration Cost Total Cost Fund at 2% Year-End Balance (in thousands) (in thousands) (in thousands) (in thousands) (in thousands) (in thousands) 2017 0 0 742,895 2018 99,756 17,655 0 117,411 13,684 639,168 2019 6,607 24,928 0 31,535 12,468 620,102 2020 5,725 4,855 0 10,580 12,296 621,818 2021 5,709 4,841 0 10,550 12,331 623,599 2022 5,709 4,841 0 10,550 12,366 625,415 2023 5,709 4,841 0 10,550 12,403 627,268 2024 5,725 4,855 0 10,580 12,440 629,128 2025 5,709 4,841 0 10,550 12,477 631,055 2026 5,709 4,841 0 10,550 12,516 633,020 2027 5,709 4,841 0 10,550 12,555 635,025 2028 5,725 4,855 0 10,580 12,595 637,040 2029 5,709 4,841 0 10,550 12,635 639,125 2030 5,709 4,841 0 10,550 12,677 641,252 2031 5,709 4,841 0 10,550 12,720 643,422 2032 5,725 4,855 0 10,580 12,763 645,605 2033 5,709 4,841 0 10,550 12,807 647,861 2034 5,709 4,841 0 10,550 12,852 650,163 2035 5,709 7,747 0 13,456 12,869 649,575 2036 5,725 7,034 0 12,759 12,864 649,680 2037 5,675 0 0 5,675 12,937 656,942 2038 5,675 0 0 5,675 13,082 664,349 2039 5,675 0 0 5,675 13,230 671,904 2040 5,690 0 0 5,690 13,381 679,595 2041 5,675 0 0 5,675 13,535 687,455 2042 5,675 0 0 5,675 13,692 695,472 2043 5,675 0 0 5,675 13,853 703,650 2044 5,690 0 0 5,690 14,016 711,976 2045 5,675 0 0 5,675 14,183 720,483 2046 5,675 0 0 5,675 14,353 729,161 2047 5,675 0 0 5,675 14,526 738,012 2048 5,690 0 0 5,690 14,703 747,026 2049 5,675 0 0 5,675 14,884 756,234 2050 5,675 0 0 5,675 15,068 765,627 2051 5,675 0 0 5,675 15,256 775,208 2052 5,690 0 0 5,690 15,447 784,965 2053 5,675 0 0 5,675 15,643 794,933 2054 5,675 0 0 5,675 15,842 805,099 2055 5,675 0 0 5,675 16,045 815,469 2056 5,690 0 0 5,690 16,252 826,032 2057 5,675 0 0 5,675 16,464 836,821 2058 5,675 0 0 5,675 16,680 847,825 2059 5,675 0 0 5,675 16,900 859,050 2060 5,690 0 0 5,690 17,124 870,484 2061 5,675 0 0 5,675 17,353 882,162 2062 5,675 0 0 5,675 17,586 894,073 2063 5,675 0 0 5,675 17,825 906,222 2064 5,690 0 0 5,690 18,068 918,600 2065 5,675 0 0 5,675 18,315 931,240 2066 5,675 0 0 5,675 18,568 944,133 2067 29,967 0 430 30,396 18,579 932,315 2068 68,099 0 1,389 69,488 17,951 880,779 2069 124,318 0 1,715 126,033 16,355 771,101 2070 94,506 0 1,050 95,556 14,466 690,012 2071 79,538 0 716 80,254 12,998 622,756 2072 53,260 0 279 53,539 11,920 581,137 2073 5,114 0 28,702 33,816 11,285 558,605 2074 98 0 21,231 21,329 10,959 548,235 Total1 $828,750 $130,038 $55,511 $1,014,300 Footnotes next page

Attachment 2, Page 2 of 2 Footnotes:

Column A - Annual Expenses - License Termination Cost - Reflects the License Termination cost portion of the Decommissioning Cost Estimate (DCE) escalated to 2017 dollars at the Consumer Price Index escalation rate of 1.7% for 2014, 0.1% for 2015, 1.3% for 2016, and 2.1% for 2017. The 2018 costs represent the sum of 2013 through 2018 costs from the DCE, less $78,756,081 of License Termination costs disbursed from the funds through December 31, 2017. Outstanding License Termination costs of

$4,794,531 were not reimbursed as of December 31, 2017 due to outstanding November and December 2017 reimbursements and outstanding City of Tallahasse reimbursement. Reimbursement of these outstanding costs is expected after December 31, 2017.

Column B - Annual Expenses - Spent Fuel Management Cost - Reflects the Spent Fuel Management cost portion of the Decommissioning Cost Estimate (DCE) escalated to 2017 dollars at the Consumer Price Index escalation rate of 1.7% for 2014, 0.1% for 2015, 1.3% for 2016, and 2.1% for 2017. The 2018 costs represent the sum of 2013 through 2018 costs from the DCE, less $156,395,199 of Spent Fuel Management costs disbursed from the funds through December 31, 2017. Outstanding Spent Fuel Management costs of $9,958,895 were not reimbursed as of December 31, 2017 due to outstanding November and December 2017 reimbursements. Reimbursement of these outstanding costs is expected after December 31, 2017. Notwithstanding the acquisition in 2015 and 2016 by DEF of co-owner ownership interests, the 2016 through 2018 costs continue to include ISFSI capital construction costs for the ownership interests of all co-owners (8.2194%) as of the submittal date of the Update to Irradiated Fuel Management Program pursuant to 10 CFR 50.54(bb) (ADAMS Accession No. ML13340A008). DEF will continue to fund the ISFSI capital construction costs for its ownership interest (91.7806%) as of the submittal date of the Update to Irradiated Fuel Management Program pursuant to 10 CFR 50.54(bb) (ADAMS Accession No. ML13340A008) in accordance therewith. Current projected ISFSI capital construction costs are now estimated to be $83.7M through 2018. Accordingly, these costs associated with the ownership interests of all co-owners (8.2194%) are included in the table above.

Column C - Annual Expenses - Site Restoration Cost - Reflects the Site Restoration cost portion of the Decommissioning Cost Estimate (DCE) escalated to 2017 dollars at the Consumer Price Index escalation rate of 1.7% for 2014, 0.1% for 2015, 1.3% for 2016, and 2.1% for 2017. Site Restoration costs of $7,936,042 were incurred in 2013 through 2017, of which $7,891,748 has been reimbursed as of December 31, 2017. Reimbursement of the outstanding costs is expected after December 31, 2017.

Column D - Annual Expenses - Total Cost - Reflects the sum of the License Termination, Spent Fuel Management and Site Restoration costs.

Column E - Projected Earnings - Reflects earnings on funds remaining in the trusts. Pursuant to 10 CFR 50.82(a)(8)(vi), a 2% real rate of return is used in this financial analysis. The earnings are calculated on the previous year's end-of-year fund balance (Column F) less 50% of the given year's annual expenses.

Column F - End-of-year Fund Balances - Reflects the end-of year fund balance of all funds after all projected earnings are added and projected expenditures are deducted.

The 2017 end-of-year fund balance includes 100% of $6,975,535 in funds held by the City of Tallahassee on behalf of Duke Energy Florida, which pursuant to NRC order (ADAMS Accession No. ML020670117) will only be used for NRC radiological decommissioning.

For the purposes of demonstrating financial assurance in accordance with 10 CFR 50.82(a)(8)(vi), the methodology and assumptions in this analysis are consistent with the March 28, 2014, Request for Exemption from 10 CFR 50.82(a)(8)(i)(A) and 10 CFR 50.75(h)(2) (ADAMS Accession No. ML14098A037), which was approved by NRC on January 26, 2015 (ADAMS Accession No. ML14247A545).

1 Total may not add due to rounding.