ML040980027
| ML040980027 | |
| Person / Time | |
|---|---|
| Site: | Millstone, Surry, North Anna  (DPR-021, DPR-032, DPR-037, NPF-004, NPF-007) |
| Issue date: | 03/29/2004 |
| From: | Christian D Dominion Nuclear Connecticut |
| To: | Document Control Desk, NRC/FSME |
| References | |
| 04-163 | |
| Download: ML040980027 (10) | |
Text
Dominion Nuclear Connecticut, Inc.
X Dominion Millstone Power Station D
Rope Ferry Road Waterford. CT 06385 March 29, 2004 United States Nuclear Regulatory Commission Serial No.04-163 Attention: Document Control Desk NL&OS/SWT R1 Washington, D. C. 20555-0001 Docket No.
50-245 License No.
DPR-21 DOMINION NUCLEAR CONNECTICUT MILLSTONE POWER STATION UNIT 1 DECOMMISSIONING FUNDING STATUS REPORT AND UPDATE TO PARENT COMPANY GUARANTY Pursuant to 10 CFR 50.75(f)(1), Dominion Nuclear Connecticut, Inc., (DNC) is providing the report on the status of decommissioning funding for Millstone Unit 1 as Attachment 1.
In addition, the annual update of the Millstone Unit 1 parent company guaranty has been performed as required by Condition 2.C(5) of its license.
In a letter dated March 31, 2003, DNC and Virginia Electric and Power Company (Dominion) provided the biennial update status on decommissioning funding for the Surry, North Anna and Millstone Power Stations. Subsequently, in a letter dated June 25, 2003, a parent company guaranty was provided to the Nuclear Regulatory Commission in the amount of 110 million dollars. This parent company guaranty covered DNC Millstone Units 1 and 2 as well as Dominion Surry Units 1 and 2 and North Anna Units 1 and 2. contains the updated financial test in support of the parent company guaranty. As demonstrated by the financial test, the current parent company guaranty for Millstone Units 1 and 2, Surry Units 1 and 2 and North Anna Units 1 and 2 remains an acceptable method for providing financial assurance in concert with the other means of financial assurance noted in our previous letter dated March 31, 2003. Since the March 31, 2003 submittal there have been no material changes to trust agreements established for nuclear decommissioning of Millstone Unit 1.
If you have any questions or require additional information, please contact Ms. Sheri Tew at (804) 741-2368.
Very truly yours, David A. Christian Senior Vice President and Chief Nuclear Officer Attachments (2)
Serial Number 04-163 Millstone Unit 1 Decommissioning Financial Assurance Page 2 of 2 Commitments made in this letter: None.
cc:
U. S. Nuclear Regulatory Commission Region I 475 Allendale Road King of Prussia, PA 19406-1415 Mr. R. J. Prince NRC Inspector U. S. Nuclear Regulatory Commission Region I 475 Allendale Road King of Prussia, PA 19406-1415 Mr. S. M. Schneider NRC Senior Resident Inspector Millstone Power Station Mr. D. G. Holland NRC Project Manager U. S. Nuclear Regulatory Commission One White Flint North 11555 Rockville Pike Mail Stop 7E1 Rockville, MD 20852-2738 Mr. V. Nerses NRC Senior Project Manager U. S. Nuclear Regulatory Commission One White Flint North 11555 Rockville Pike Mail Stop 8C2 Rockville, MD 20852-2738 Mr. William Meinert Nuclear Engineer Mass. Municipal Wholesale Electric Co.
Moody Street, P. 0. Box 426 Ludlow, MA 01056 S. Page Central Vermont Public Service Corp.
77 Grove Street Rutland, VT 05701
Serial No.04-163 Millstone Unit 1 Decommissioning Financial Assurance DOMINION NUCLEAR CONNECTICUT, INC. (DNC)
MILLSTONE POWER STATION UNIT 1 2004 DECOMMISSIONING FUNDING STATUS REPORT
Serial No.04-163 Millstone Unit 1 Decommissioning Financial Assurance Page 1 of 2 2004 Decommissioning Funding Status Report Updated Decommissioning Funding Worksheet for Millstone Unit 1 II504A480,827 Estimated Decommissioning Cost Estimate at Time of License Transfer (Exhibit L to License Transfer Application) (1999 dollars)
$12,859,695 Cost savings associated with adjusted SAFESTOR estimates, based on tighter work-scope and manpower costs (1999 dollars) *
$7,589,890 Cost savings associated with specific vendor bids for spent fuel pool projects (1999 dollars)*
- As of 12/31/03 actual costs are lower than previous estimates which are conservative. The next decommissioning study will true up the remaining cost estimates.
$484,031,242
$577.216,259 Prior revised decommissioning cost estimate (1999 dollars)
Prior revised decommissioning cost estimate (2003 dollars)
Unit 1 Qualified Fund Balance as of 12/31/03 Unit 1 Non-Qualified Fund Balance as of 12/31/03 Unit 1 Guaranty Amount Total Fund Balances as of 12/31/2003
$281 219,969
$0
$0
$281 219,969 Millstone Unit 1 Decommissioning Expenditures
$571,603,507
$2,398,889
$1,428,861 4.50%
6.50%
0.75%
Estimated Remaining Decommissioning Costs (12/31/2003 $)
Annual monitoring cost during SAFSTOR (12/31/2003 $)
Annual Decommissioning Activities (2004 - 2008) (12/31/2003 $)f Additional scope anticipated but not yet submitted for approval.
Inflation Rate After Tax Earnings - Long Term After Tax Earnings - Money Market
Serial No.04-163 Millstone Unit 1 Decommissioning Financial Assurance Page 2 of 2 Year 2004 2006 2007 2008 2009 2010 2011 2012 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050 2051 2052 2053 2054 2055 2056 2057 Beginning of Year Balance Unit 1 Expenditures End of Year Balance Earninas
- 6
- 4.
.4
$281 219969
$270,952,633
_284248.705
_ 15,778.973 517,.476.071 S18,334.203
$26.046,309
$4,180,000
$4368p099
_ 270,952,633
_5284,248,705 S298,214,808 S312,885,755 S298.214,808 S19.235.611
$4.564.664 I
_312,885755
$328,485,294 5346,611,330 5365,770,411 5386,023,152 5407.423.732 S430.059,796
$453,994,113 S479,303,280 S506,056,496 S534,363,171
$564,303,366 5595,973.969
_ S629,463,410 5664.908,453 S702.411.269 S20,188_435 521 250,015
$_22,423,638 523,664,204 524,975,326 S26 361,467
=S27,827,363 S29,377,400 531,016,167 5S32,749,287 534,582,724 536,522,047 S38.573,089 s40.742,940 S43,039,120 545.468,706
$4,588,896
$3,123,978 53264,558
$3,411,463
$3,574,746
_53,725,403 53.893,046
$4,068233
$4,262,951
$4,442,612
$4,642,530
$4,851,444
_$5,083,648
$55297,898
$5,536A303
$55,785,437 S328,485294 S346,611330
__5365,770,411
$386,023,152 5407.423,732 54300.059_796
_54_53.994,113 S479,303,280_
$506,056,496 5534,363,171 5564,303,366 5595.973.969
$629,463,410 664,908,453
$702,41 1269 5742.094.538 5742,094,538 548,039,119
_6062,345 5784,071,312 5784,071,312 550,759,305
$6,317,841 5828,512,776 5828,512.776 553,638,761
$6,602,144
$875,549,392 875,54,392 556,686,485_ $6,899,241 925,336,637 5925,336,637 559,911.924 _
7_229,459
$978,019,101
$978,019,101
$1.033,811,340
$1,092,880,019
$1 155.422,354
$1221.623,351
$1,291 752,263
$1,366,022,107
$1.444,683,259 51,527,972,519 S1 $16,228,208 51,709,722,702
$1,808,774,124 S1,913,685,676
$2,024,882,978
$2,142,714,453
$2,267,584,607
$2,399.881_793
$2,540,142,086
$2,688,811,357
$2,846,404,332 52.913,108,877 52,713,425,807
$2,.060,739,791
$1,195,460,011 5230,856,941 5128.811,404 _
53,616,824_
563,326,382 566,941,859 5S70,769,808 574,822,262 579,113,518
$83,658,757
$93,570,279 S98.969,999
$104,690.949
$110,751,716
$117,171,858
$123,974,316
$131,183,454 5138,822,973
$146,917,829
$155,497,120 5_164,.591,755 S174,231.971
$181,292,183
_$177,106,419
_$150,276,399 5102,495,393
$56,459,626
$32,036,540 S20,473,090
$1 1321 280 54,168,443
_7,534,143
$7,873,180
$8,227,473
$8'621,265
$8,984,606
_9 388,913
$9,811,415
$10,281,018 510,714,310
$11,196,454
$11.700.294
$12,260,306
$12,777,014
$13,351,980
$14,620,643
$515236,827
$15,922,484 516,638,996
$114,587,638
$376,789,488
$802,962,415
$967,775,173
$653,700,760 5210,6 8,051 5209,173,515
$113,366,817
$129.363,024 51,033,811,340 5
1,092,880,019 51,155,422.354 51,221.623 351
_51.291 752 263 s1,366,022,107 51,444,683,259 51,527.972,519
$1,616228208 51.709,722,702 51,808,774,!124 51.913,685,676 52,024,882,978 52,142.714,453 52,267,584,607 52,399,881,793 52,540,142,086
$2,688,811,357 52,846,404,332 52,913,108,877
$2,713,425,807 s2,060739,791 51,195,460,011
$598218,878 S419,557,367
_5230,856,941 5t128,811,404
_ $3,616,824 Trust Fund Excess (W3112003 $1
$128,469 Trs Fun Ex es 1111213
)$
2,
Serial No.04-163 Millstone Unit 1 Decommissioning Financial Assurance DOMINION NUCLEAR CONNECTICUT, INC. (DNC)
MILLSTONE POWER STATION UNIT 1 FINANCIAL TEST CONTAINED IN 10 CFR PART 30 APPENDIX A, INCLUDING INDEPENDENT ACCOUNTANTS' REPORT
Serial No.04-163 Millstone Unit 1 Decommissioning Financial Assurance page 1 of 2 FINANCIAL TEST CONTAINED IN 10 CFR PART 30 APPENDIX A Dominion Resources, Inc. (DRI), located at 120 Tredegar Street, Richmond, Virginia 23219, as parent company of Virginia Electric and Power Company (Dominion) and Dominion Nuclear Connecticut, Inc. (DNC) satisfies the financial test contained in Appendix A to 10 CFR Part 30 for use of a parent guaranty in the total amount of $110 million.'
DRI guarantees, through the parent company guaranty, $110 million for the purpose of decommissioning the nuclear facilities owned by Dominion Resources, Inc. (DRI):
Facility Name Location License No.
Surry Unit 1 Surry, VA DPR-32 Surry Unit 2 Surry, VA DPR-37 North Anna Unit 12 Louisa, VA NPF-4 North Anna Unit 22 Louisa, VA NPF-7 Millstone Unit I Waterford, CT DPR-21 Millstone Unit 2 Waterford, CT DPR-65 Millstone Unit 3 Waterford, CT NPF-49 DRI is required to file a Form 10K with the U.S. Securities and Exchange Commission.
The DRI 2003 10K was separately transmitted to the NRC on March 29, 2004 (Serial Number 04-168). The figures for line items B and C as shown below were derived from DRI's independently audited, year-end financial statements and footnotes for the 12-month period ended December 31, 2003, and underlying accounting records.
A. DRI's current implied bond ratings are BBB+ and Baal for Standard and Poor's and Moody's, respectively.
The NRC Minimum and the subsequent 2% allowable real rate of return calculations have been revised to reflect License Renewal (NRC approval - March 2003) for the Surry and North Anna units. The result of including License Renewal is that a Parent Company Guaranty is no longer required for Surry Unit I and Unit 2 and North Anna Unit 1 and Unit 2 as these units are now fully funded. Additionally, Millstone Unit 2, without License Renewal, no longer requires a Parent Company Guaranty as this unit is now fully funded. Millstone Unit 3, without License Renewal, has been and remains fully funded and therefore does not require a Parent Company Guaranty. Millstone Unit 1, which has been approved for the 'SAFESTOR" method of decommissioning, is now fully funded and no longer requires a Parent Company Guaranty.
DRI will leave the existing $110 Million Parent Company Guaranty in place for this 2004 filing for the purpose of covering any variations to either the decommissioning escalation rate or decommissioning trust fund growth rate between now and the next filing.
2 The North Anna Nuclear Power Station is jointly owned by Virginia Electric and Power Company (88.4%)
and Old Dominion Electric Cooperative (11.6%). However, Virginia Electric and Power Company is contractually responsible for 89.26% of the decommissioning obligation and Dominion Resources, Inc. is providing a guaranty for that portion only.
Serial No.04-163 Millstone Unit 1 Decommissioning Financial Assurance page 2 of 2 B. Computation of tangible net worth (millions of dollars):
Net Worth
$10,538 LESS: Intangible Assets 365 Goodwill 4,300 Tangible Net Worth 5,873 LESS: Net Book Value of Nuclear Plants 3.258 Tangible Net Worth less book value of plants 2.615 C.
Total Assets
=
$44,186 Less: Foreicqn
=
$ 1,550 Total US Assets
=
$42.636 FINANCIAL TESTS YES NO
- 1. Is line B at least $10 Million?
0 0
- 2. Is line B at least 6 times the guaranty amount of $110 million?
0 El
- 3. a. Are at least 90 percent of the firm's assets located in the U.S.?
0 0
or
- b. Is line C at least 6 times the guaranty amount of $110 million?
0E 0
- 4. a. Are bond ratings BBB or above as issued by Standard and Poor's?
0 E
0 or
- b. Are bond ratings Baa or above as issued by Moody's?
0 0
I hereby certify that the content of this financial test is true and correct to the best of my knowledge.
G. Scott etie~r
/
~,Presiden~
Senior Vice d Treasurer Dominion Resources, nc.
Deloitte & Touche LLP 707 East Main Street Suite 500 Eighth & Main Building Richmond, Virginia 23219 Tel: (804) 697-1500 Fax: (804) 697-1825 Dloit www.deloitte.com Deloitte
&Touche INDEPENDENT ACCOUNTANTS' REPORT ON APPLYING AGREED-UPON PROCEDURES To the Board of Directors of Dominion Resources, Inc.
Richmond, Virginia We have performed the procedures included in 10 CFR 30, Appendix A, which were agreed to by the United States Nuclear Regulatory Commission and Dominion Resources, Inc. (the Company), solely to assist the specified parties in evaluating the Company's compliance with the parent company guarantee financial test option as of December 31, 2003, included in the accompanying letter dated March 29, 2004 from David A.
Christian of Virginia Electric and Power Company and Dominion Nuclear Connecticut, Inc., and with respect to Attachment 2, from G. Scott Hetzer of Dominion Resources, Inc. Management is responsible for the Company's compliance with those requirements. This agreed-upon procedures engagement was performed in accordance with attestation standards established by the American Institute of Certified Public Accountants. The sufficiency of these procedures is solely the responsibility of the parties specified in this report. Consequently, we make no representation regarding the sufficiency of the procedures described below either for the purpose for which this report has been requested or for any other purpose.
The procedures that we performed and related findings are as follows:
- 1.
We compared the amounts included in Attachment 2. Dominion Nuclear Connecticut, Inc. (DNC),
Virginia Electric and Power Company (Dominion). Surry Power Station Unit 1. Surry Power Station Unit 2, North Anna Power Station Unit 1. North Anna Power Station Unit 2. Millstone Power Station Unit 1, Millstone Power Station Unit 2, Millstone Power Station Unit 3, Decommissioning Financial Assurance. Financial Test Contained in 10 CFR Part 30 Appendix A. Section B. Net Worth, Intangible Assets and Goodwill, and Section C. Total Assets, in the letter referred to above with the corresponding amounts in the audited financial statements of Dominion Resources, Inc. as of and for the year ended December 31, 2003, on which we have issued our report dated February 26, 2004, which report expressed an unqualified opinion and included an explanatory paragraph as to changes in accounting principles for: asset retirement obligations, contracts involved in energy trading, derivative contracts not held for trading purposes, derivative contracts with a price adjustment feature, the consolidation of variable interest entities, and guarantees in 2003; goodwill and intangible assets in 2002; and derivative contracts and hedging activities in 2001, and noted that such amounts were in agreement.
- 2.
We recomputed from, or reconciled to, the audited financial statements referred to in procedure 1, the information included in Attachment 2. Dominion Nuclear Connecticut, Inc. (DNC), Virginia Electric and Power Company (Dominion). Surrv Power Station Unit 1. Surry Power Station Unit 2, North Anna Power Station Unit 1, North Anna Power Station Unit 2. Millstone Power Station Unit 1.
Millstone Power Station Unit 2, Millstone Power Station Unit 3. Decommissioning Financial Assurance. Financial Test Contained in 10 CFR Part 30 Appendix A Section B. Net Book Value of Nuclear Plants and Section C. Foreign assets, in the letter referred to above and noted no differences.
Deloitte Touche Tohmatsu
We were not engaged to, and did not, perform an examination, the objective of which would be the expression of an opinion on the accompanying letter dated March 29, 2004. Accordingly, we do not express such an opinion. Had we performed additional procedures, other matters might have come to our attention that would have been reported to you.
This report is intended solely for the information and use of the Board of Directors and management of Dominion Resources, Inc. and the United States Nuclear Regulatory Commission, and is not intended to be and should not be used by anyone other than these specified parties.
March 29, 2004