ML030930635

CFR Report on Status of Decommissioning Funding

ML030930635
Person / Time
Site:	Wolf Creek
Issue date:	03/28/2003
From:	Larson M Wolf Creek
To:	Document Control Desk, Office of Nuclear Reactor Regulation
References
CT 03-0021
Download: ML030930635 (5)

Text

WOLF CREEK 'NUCLEAR OPERATING CORPORATION Mark S. Larson Controller-Treasurer MAQ 2Qnns CT 03-0021 U.S. Nuclear Regulatory Commission ATTN: Document Control Desk Washington, DC 20555

Subject:

Docket No. 50-482: 10 CFR 50.75 Report on Status of Decommissioning Funding Gentlemen:

Pursuant to 10 CFR 50.75, this letter and enclosures report the status of decommissioning funding for the Wolf Creek Generating Station (WCGS) located near Burlington, Kansas.

General Information Wolf Creek Nuclear Operating Corporation (WCNOC) is a jointly owned corporation formed by its owners: Kansas Gas and Electric Company (KGE), a wholly-owned subsidiary of Westar Energy, Inc., Kansas City Power & Light Company (KCPL), a wholly-owned subsidiary of Great Plains Energy Incorporated, and Kansas Electric Power Cooperative, Inc. (KEPCo).

WCNOC acts as an agent on behalf of Its owners to operate, maintain, repair, decontaminate, and decommission WCGS. While WCNOC holds the operating license for WCGS, its formation has not changed the ownership or ultimate responsibility for the costs (including decommissioning) of WCGS.

Report Items shows the estimated decommissioning funds required pursuant to 10 CFR 50.75 (b) and (c). Enclosure 2 provides the total value of funds (including net earnings to date) accumulated in each owner's external trust fund as of December 31, 2002. Also reported on Exhibit 2 is a schedule of the annual amounts remaining to be collected and assumptions for rates of cost escalation and earnings on funds. A new site specific study was performed in 2002. It assumes demolition of all structures at the plant site. Approximately 91% of the study's total estimated costs are for work scopes considered in the minimum decommissioning cost formulas in 10 CFR 50.75 (b) and (c). The new study has been approved by the Missouri Public Service Commission (MPSC), and KCPL's rate collections allocable to Missouri are based on It. The Kansas Corporation Commission (KCC) is

-Ab P.O. Box 411 / Burlington, KS 66839/ Phone: (620) 364-8831 An Equal Opportunity Employer M/F/HC/VET

CT 03-0021 Page 2 of 2 considering the new study, but has not yet approved it. The owners' rate orders for collections in Kansas are still based on a 1999 site study for WCGS.

There have been no modifications to the method for providing financial assurance since the last submitted report. Each owner has an external trust fund that it maintains to provide for its share of WCGS decommissioning costs, and is making regular contributions from amounts collected in electric rates approved by their state commissions and the Federal Energy Regulatory Commission. Note that KGE recently sought and received approval from the KCC to add 20 years to its schedule of contributions. This is consistent with the time frame over which its investment in WCGS is being depreciated for rate purposes.

There have been no amendments or other material changes to any of the owners' trust agreements, nor are there any other contracts upon which they are relying pursuant to paragraph (e) (1) (v) of 10 CFR 50.75.

This letter contains no regulatory commitments.

If you have any questions, please call me at (620) 364-4004, or Karl (Tony) Harris at (620) 364-4038.

Sincerely, Mark S. Larson MSUrIr Enclosures cc: J. N. Donohew (NRC), wle D. N. Graves (NRC), w/e E. W. Merschoff (NRC), w/e M.A. Dusaniwskyj (NRC), wle Senior Resident Inspector (NRC), w/e to CT 03-0021 Page 1 of I WOLF CREEK NUCLEAR OPERATING CORPORATION Minimum Decommissioning Funds Estimate pursuant to 10 CFR 50.75 (b) and (c)

MINIMUM ESTIMATE Table (c)(1) - Jan86 dollars in Millions $ 105

[Wolf Creek Is a PWR licensed for 3,565 MWt]

Escalation Factor (see calculation below) 3.427 Minimum estimate - DecO2 dollars in Millions $ =

360 Escalation oer Daraaraih (c)(2)

Escalation Factor = 0.65 Labor + 0.13 Energy + 0.22 Waste Burial Share 4Q 02 Report Labor 65% 1.840 1.196 Energy 13% 1.140 0.148 Waste Burial 22% 9.467 2.083 TOTAL ESCALATION FACTOR 3.427 NOTE: 40 '02 factors per Thelen Reid & Priest LLP memo dated March 2003.

SITE SPECIFIC STUDY (August 2002)

Decommissioning Alternative DECON (2002 $s)

DECON Period Millions  % Total Preparation for Decommissioning $ 88 19%

Radioactive Systems/Structures and License Termination 338 72%

Subtotal - Applicable to NRC Minimum 426 91%

Other Systems/Structures and Site Restoration 42 9%

TOTAL COST ESTIMATE $ 468 100%

- Enclosure 2 to CT 03-0021 Page 1 of 2 WOLF CREEK NUCLEAR OPERATING CORPORATION Decommissioning Funding Status Report as of December 31, 2002 (Dollars In Thousands)

TOTAL KGE KCPL KEPCo Market Value of External $ 131,556 $ 63,522 $ 63,283 $ 4,751 Sinking Fund as of 12/31/02 Schedule of Amounts to be Collected (as approved by rate-setting authorities based on Site Specific Study) 2003 7,749 3,846 $ 3,553 $ 350 2004 7,754 3,846 3,553 355 2005 7,759 3,846 3,553 360 2006 8,111 4,046 3,699 366 2007 8,116 4,046 3,699 371 2008 8,122 4,046 3,699 377 2009 8,291 4,046 3,863 382 2010 8,297 4,046 3,863 388 2011 8,303 4,046 3,863 394 2012 8,492 4,046 4,046 400 2013 8,498 4,046 4,046 406 2014 8,504 4,046 4,046 412 2015 8,715 4,046 4,251 418 2016 8,721 4,046 4,251 424 2017 8,728 4,046 4,251 431 2018 8,962 4,046 4,479 437 2019 8,969 4,046 4,479 444 2020 8,975 4,046 4,479 450 2021 9,238 4,046 4,735 457 2022 9,245 4,046 4,735 464 2023 9,252 4,046 4,735 471 2024 9,544 4,046 5,020 478 2025 9,066 4,046 5,020 0 2026 4,046 4,046 2027 4,046 4,046 2028 4,046 4,046 2029 4,046 4,046 2030 4,046 4,046 2031 4,046 4,046 2032 4,046 4,046 2033 4,046 4,046 2034 4,046 4,046 2035 4,046 4,046 2036 4,046 4,046 2037 4,046 4,046 2038 4,046 4,046 2039 4,046 4,046 2040 4,046 4,046 to CT 03-0021 Page 2 of 2 WOLF CREEK NUCLEAR OPERATING CORPORATION Decommissioning Funding Status Report as of December 31, 2002 (Dollars In Thousands)

TOTAL KGE KCPL KEPCo 2041 4,046 4,046 2042 4,046 4,046 2043 4,046 4,046 2044 4,046 4,046 2045 1,012 1,012 AssumDtions re: Rates/Factors specific to Owner and Jurisdiction Cost Escalation Rate Kansas 3.60% 3.60% 3.60%

Missouri 4.50%

After Tax Earnings on Funds Kansas 5.11% 6.93% 9.00%

Missouri 7.66%