AEP-NRC-2011-34, Response to Request for Information Regarding the Decommissioning Funding Status Report

Response to Request for Information Regarding the Decommissioning Funding Status Report

ML11172A124
Person / Time
Site:	Cook
Issue date:	06/07/2011
From:	Gebbie J Indiana Michigan Power Co, American Electric Power
To:	Document Control Desk, Office of Nuclear Reactor Regulation
References
AEP-NRC-2011-34, TAC ME5473, TAC ME5474
Download: ML11172A124 (2)

Text

INDIANA MICHIGAN Indiana Michigan Power One Cook Place PoWERi Bridgman, MI 49106 A unit of American Electric Power IndianaMichiganPower.com June 7,2011 AEP-NRC-2011-34 10 CFR 50.75(f)(1)

U. S. Nuclear Regulatory Commission ATTN: Document Control Desk Washington, DC 20555-0001

SUBJECT:

Donald C. Cook Nuclear Plant Units 1 and 2 Docket Nos. 50-315 and 50-316 Response to Request for Information Regarding the Decommissioning Funding Status Report (TAC Nos ME5473 and ME5474)

Dear Sir or Madam:

By letter dated March 30, 2011, Indiana Michigan Power Company (I&M), the licensee for Donald C. Cook Nuclear Plant'(CNP), submitted the Decommissioning Funding Status Report. By e-mail dated May 9, 2011, the Nuclear Regulatory Commission (NRC) communicated to CNP a request for.additional information (RAI). This RAI required a response to two issues which involve a clarification on the' basis 'used for the 2 percent real rate of return and the after tax value of the decommissioning funds collected.

The enclosure to this letter provides I&M's response to the NRC RAI.

This letter contains no new commitments. Should you have any questions, please contact Mr. Michael K. Scarpello, Regulatory Affairs Manager, at (269) 466-2649.

Sincerely, Joel P. Gebbie Site Vice President DMB/jmr Enclosure c: J. T. King, MPSC S. M. Krawec, AEP Ft. Wayne, w/o enclosure MDEQ - WHMD/RPS NRC Resident Inspector M: A. Satorius, NRC Regionlll P. S. Tam, NRC Washington DC . (

I-)

Alk

Enclosure to AEP-NRC-2011-34 Response to NRC Request for Additional Information By letter dated March 30, 2011, Indiana Michigan Power Company (I&M), the licensee for Donald C. Cook Nuclear Plant (CNP), submitted the Decommissioning Funding Status (DFS)

Report. By e-mail dated May 9, 2011, the Nuclear Regulatory Commission (NRC) communicated to CNP a request for additional information (RAI). This RAI required a response to two issues which involve a clarification on the basis used for the 2 percent real rate of return and the after tax value of the decommissioning funds collected. Each RAI item is restated below followed by the corresponding I&M response.

NRC RAI Question 1:

Citation for realrate of returns:

Provide the citation (e.g., an Order by the rate-regulatoryauthority) by the regulatory entity that allows for the assumptions used regardingrates of escalation in decommissioning costs, rate of earning on decommissioning funds and rates of other factors assumed in your DFS report.

Your March 30, 2011, report used the following for Cook 1 and 2: a 2 percent real rate of return was applied to the annualbalance for future funding projections.

As stated in 10 CFR 50.75(0(1),

The information in [the DFS] report must include [..] 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...

I&M Response As stated in 50.75 Reporting and Recordkeeping for Decommissioning Planning, Section (e)(ii),

a licensee that has collected funds based on the formulas in 50.75(c) of this section may take credit for collected earnings on the decommissioning funds using up to a 2 percent annual real rate of return up to the time of permanent termination of operations. This method of projecting future earnings was included in our March 30, 2011, report. Although the rate, regulatory authority for CNP may include rates of escalation, these are not used as the basis for our DFS Report. The citations for the Orders that address decommissioning funding are the State of Michigan Case Number U-10347 and the State of Indiana Cause Number 43306.

NRC RAI Question 2:

Provide the after-tax amount of funds accumulated through December 31, 2010. Your March 30, 2011, report did not provide the after-tax amount of funds accumulated through December 31, 2010. The provisions of 10 CFR 50.75(0(1) and (2) require the licensee to report the amount of funds accumulatedto the end of the calendaryearpreceding the report.

I&M Response The amount of $761,279,714 reported in CNP's DFS Report reflects the market value of the funds accumulated through December 31, 2010, net of all taxes currently due.