ML070930605

CFR 50.75(f)(1) Decommissioning Funding Report

ML070930605
Person / Time
Site:	San Onofre
Issue date:	03/30/2007
From:	Scherer A Southern California Edison Co
To:	Document Control Desk, NRC/NRR/ADRO
References
TAC MD0345, TAC MD0346
Download: ML070930605 (5)

Text

A. Edward Scherer SOUTHERN CALIFORNIA EDISON Manager of Nuclear Regulatory Affairs An EDISON INTERNATIONAL Company March 30, 2007 U. S. Nuclear Regulatory Commission Attention: Document Control Desk Washington, D. C. 20555

Subject:

Docket Nos. 50-361 and 50-362 10 CFR 50.75(f)(1) Decommissioning Funding Report San Onofre Nuclear Generating Station Units 2 and 3

Reference:

Letter from N. Kalyanam NRC) to Richard M. Rosenblum (SCE) dated December 29, 2006;

Subject:

San Onofre Nuclear Generating Station, Units 2 and 3- Issuance of Amendments re: The Transfer of Licenses Permitting the Transfer of the Undivided Ownership Interest Held by the City of Anaheim to Southern California Edison Company, Excluding its Interest in Spent Fuel and in the Independent Spent Fuel Storage Installation (TAC Nos. MD0345 and MD0346)

Gentlemen:

By the referenced December 29, 2006 letter, the U. S. Nuclear Regulatory Commission issued License Amendment Numbers 209 for Unit 2 and 201 for Unit 3 reflecting the transfer of the City of Anaheim's 3.16% undivided ownership interests in San Onofre Nuclear Generating Station, Units 2 and 3 to Southern California Edison (SCE). As required by 10 CFR 50.75(f)(1), this letter provides the status of the decommissioning funding for San Onofre Units 2 and 3 as of December 31, 2006. The required information is provided in the enclosure for SCE, San Diego Gas & Electric and the Cities of Anaheim and Riverside. Based on the requirements in 10 CFR 50.75(f)(1),

SCE is reporting this information for San Onofre Units 2 and 3 on an annual basis during the period it was involved in an acquisition. The period of acquisition ended with the issuance of the license amendments on December 29, 2006. Upon submittal of the enclosed report SCE will return to an odd-year biennial reporting cycle, with the next report due on March 31, 2009.

Ifyou have any questions regarding this matter, please feel free to contact Ms. Linda Conklin at 949-368-9443.

Sincerely, P.O. Box 128 San Clemente, CA 92672 949-368-7501 Fax 949-368-7575 AOD/

Document Control Desk March 30, 2007

Enclosure:

San Onofre Units 2 and 3 Decommissioning Funding Status Report cc: B. S. Mallett, Regional Administrator, NRC Region IV N. Kalyanam, NRC Project Manager, San Onofre Units 2 and 3 C. C. Osterholtz, NRC Senior Resident Inspector, San Onofre Units 2 and 3

San Onofre Nuclear Generating Station Units 2 and 3 Decommissioning Funding Status Report Provided below is the information required by 10 CFR 50.75(f)(1) for San Onofre Units 2 and 3. This information is reported every other year for San Onofre Units 2 and 3 as required for operating plants.

All dollar amounts are in 2006 dollars, and the owners are reported as follows:

Southern California Edison (SCE) 78.21 %

San Diego Gas & Electric (SDG&E) 20.00 %

City of Anaheim (Anaheim) 0.00 %

City of Riverside (Riverside) 1.79%

The decommissioning liability is shared between the current owners and former owner, Anaheim, as set forth below for each unit:

Owner Unit 2 Decommissioning Liability Unit 3 Decommissioning Liability SCE 76.30% 76.35%

SDG&E 20.00% 20.00%

Anaheim 1.91% 1.86%

Riverside 1.79% 1.79%

1) The decommissioning fund estimated to be required pursuant to 10 CFR 50.75(b) and (c) is the following:

a) The minimum amount calculated by the method prescribed by 10 CFR 50.75(c).

San Onofre Unit 2 San Onofre Unit 3

$ 473.2 million $ 473.2 million b) The San Onofre Units 2 and 3 site-specific estimate (1)for decommissioning includes the following radiological decommissioning costs associated with terminating the site license:

San Onofre Unit 2 San Onofre Unit 3

$ 986.8 million $ 985.9 million Page 1 of 3

2) The amounts accumulated at the end of calendar year 2006 (net of estimated capital gains taxes) are:

Owner San Onofre Unit 2 San Onofre Unit 3 SCE $ 907.0 million $ 1,091.6 million SDG&E (2) $ 239.1 million $ 291.4 million Anaheim (2) $ 47.1 million $ 51.2 million Riverside (2) $ 23.1 million $ 25.9 million TOTAL $ 1,216.3 million $ 1,460.1 million

3) The annual amounts projected to be collected in 2007 are:

Owner San Onofre Unit 2 San Onofre Unit 3 SCE $ 18.6 million $ 12.6 million SDG&E (2) $ 5.3 million $ 3.9 million Anaheim (2) $ 0.0 million $ 0.0 million Riverside (2) $ 1.1 million $ 0.4 million TOTAL $ 25.0 million $ 16.9 million Each owner either (A) recovers, directly or indirectly, the estimated total cost of decommissioning through rates established by "cost of service" or similar rate making regulation, including entities that establish their own rates and are able to recover their cost of service allocable to decommissioning, or (B) has as its source of revenues for its external sinking fund a "non-bypassable charge," the total amount of which, with earnings, provides the funds estimated to be needed for decommissioning.

4) The composite escalation rates for San Onofre Units 2 and 3 Decommissioning are forecast as follows:

Owner Escalation Rate SCE Burial Costs 7.50 %

Other Costs 2.44 %

SDG&E (2) 7.50%

Burial Costs Other Costs 2.52%

Anaheim (2) 4.00 %

Riverside (2) 4.00 %

The composite escalation rate is 3.16 % for all costs.

Page 2 of 3

5) The investment rates of return for the Decommissioning Trust Funds forecast by each owner are the following:

Owner Return on Investment SCE 4.93 %

SDG&E (2) 5.76 %

Anaheim (2) 4.00 %

Riverside (2) 4.99 %

The composite investment rate of return is 5.08 %. The composite investment rate of return less the composite escalation rate yields a composite real earnings rate less than the 2 % real rate of return allowed under 10 CFR 50.75(e)(1)(ii).

6) None of the owners of San Onofre Units 2 and 3 are relying on any contracts for the purposes of providing decommissioning funding pursuant to 10 CFR 50.75(e)(1)(v). There have been no modifications to the method of providing financial assurance.

Notes: (1) The site-specific decommissioning cost estimate for San Onofre Units 2 and 3 that was provided to the California Public Utilities Commission (CPUC) on November 10, 2005, includes the radiological costs associated with terminating the site license, non-radiological costs, and fuel storage costs. The CPUC approved this estimate on January 11, 2007.

(2) SCE is submitting information with respect to its current co-owners, SDG&E and Riverside, and its former co-owner, Anaheim, on their behalf, and they are primarily responsible for the completeness and accuracy of their respective information Page 3 of 3