NL-11-0450, Financial Assurance Requirements for Decommissioning Nuclear Power Reactors (10 CFR 50.75(f)(1)

Financial Assurance Requirements for Decommissioning Nuclear Power Reactors (10 CFR 50.75(f)(1)

ML110890338
Person / Time
Site:	Farley
Issue date:	03/29/2011
From:	Ajluni M Southern Nuclear Operating Co
To:	Document Control Desk, Office of Nuclear Reactor Regulation
References
NL-11-0450
Download: ML110890338 (8)

Text

Mark J. Ailuni. P.E. Southern Nuclear Nuclear Licensing Director Operating Company. Inc.

40 Inverness Center Parkway Post Office Box 1295 Birmingham, Alabama 35201 Tel 205.992.7673 Fax 205.992.7885 March 29, 2011 SOUTHERN'\'

COMPANY Docket Nos.: 50-348 NL-11-0450 50-364 U. S. Nuclear Regulatory Commission ATIN: Document Control Desk Washington, D. C. 20555-0001 Joseph M. Farley Nuclear Plant Financial Assurance Requirements for Decommissioning Nuclear Power Reactors (10 CFR 50. 75(f)( 1))

Ladies and Gentlemen:

Pursuant to 10 CFR 50.75(f)(1), each power reactor licensee is required to report to the NRC the status of its decommisSioning funding for each reactor or part of each reactor it owns on a calendar year basis, beginning on March 31,1999, and every two years thereafter. Southern Nuclear Operating Company (Southern Nuclear) holds operating licenses NPF-2 and NPF-8 for the Joseph M. Farley Nuclear Plant owned by Alabama Power Company. Accordingly, Southern Nuclear provides the enclosed Alabama Power Company submittal in accordance with the requirements of 10 CFR 50.75(f)(1).

This letter contains no NRC commitments. If you have any questions, please advise.

Sincerely, iYlJ.8~

M. J. Ajluni Nuclear Licensing Director MJAJLWWllac

Enclosure:

Alabama Power Company Letter Response

U. S. Nuclear Regulatory Commission NL-11-0450 Page 2 cc: Alabama Power Company Ms. A. Allcorn-Walker, Executive Vice President, Comptroller Mr. C. Blake, Assistant Treasurer and Manager - Treasury/Finance Southern Nuclear Operating Company Mr. J. T. Gasser, Executive Vice President Mr. l. M. Stinson, Vice President - Farley Ms. P. M. Marino, Vice President - Engineering RTYPE: CFA04.054 U. S. Nuclear Regulatory Commission Mr. V.M. McCree, Regional Administrator Mr. R. E. Martin, NRR Project Manager - Farley Mr. E. l. Crowe, Senior Resident Inspector - Farley

Joseph M. Farley Nuclear Plant Financial Assurance Requirements for Decommissioning Nuclear Power Reactors (10 CFR 50.75(f)(1>>

Enclosure Alabama Power Company Response

Chris Blake, CPA, CMA ALABAMA'\

POWER t\ SOUTHERN COMPANY March 3, 2011 Docket Nos.: 50-348 50-364 U.S. Nuclear Regulatory Commission ATTN: Document Control Desk Washington, D.C. 20555 Joseph M. Farley Nuclear Plant Financial Assurance Requirements for Decommissioning Nuclear Power Reactors (10 CFR 50.75(fJ(1))

Dear Ladies and Gentlemen:

Pursuant to 10 CFR 50.75(f)(1), each power reactor licensee is required to report to the NRC the status of its decommissioning funding for each reactor or part of each reactor it owns on a calendar year basis, beginning on March 31, 1999, and every two years thereafter. Alabama Power Company (APC) hereby submits the enclosed information in accordance with 10CFR 50.75(f)(1) for operating licenses NPF-2 and NPF-8 issued for Joseph M. Farley Nuclear Plant Unit 1 and 2, respectively.

Southern Nuclear Operating Company, as the operating licensee and as an agent for the owner of Farley Nuclear Plant, is providing this information to the NRC on behalf of APC.

Based on the information presented herein, there is reasonable assurance that the funding necessary for decommissioning the Farley Nuclear Plant, consistent with the NRC prescribed minimum set forth in 10 CFR 50.75(c), will be available on the expiration date of the operating licenses NPF-2 and NPF-8.

Please advise if you have any questions or comments regarding the information provided herein.

Respectfully submitted, ALABAMA POWER COMPANY, by, CJ~13.)

Chris Blake CRB:kph Enclosure

Enclosure Alabama Power Company Ownership Percentage - 100%

10 CFR 50.75(f)(1) Requirement Unit 1 Unit 2 1 The NRC minimum decommissioning estimate, $ 435,256,000 $ 435,256,000 pursuant to 10 CFR 50.75(b) and (c). 1 I 2 2 2 The amount accumulated at the end of the $281,923,125 $269,782,967 calendar year preceding the date of the report for i items included in 10 CFR 50.75(b) and (c).

3 I A schedule of the annual amounts remaining to be See Schedule in See Schedule in

! collected; for items in 10 CFR 50.75(b) and (c). Attachment 1 Attachment 1 4 The assumptions used regarding:

(a) rates of escalation in decommissioning 4.5% 4.5%

costs; (b) rates of earnings on decommissioning 7.0% 7.0%

funds; 2.5% 2.5%

(c) real rate of return; and N/A N/A (d) rates of other factors used in funding I

projections.

I I

5 Any contracts upon which the licensee is relying N/A NfA pursuant to 10 CFR 50.75(e)(1)(v). I .--~ ..

No modifications Any modifications to a licensee's current method External Sinking Fund i of providing financial assurance occurring since J the last submitted report.

"Cost of Service" Rate Making I

7 i Any material changes to trust agreements. See Attachment 3 NOTES:

The NRC formulas in section 10 CFR 50.75(c) include only those decommissioning costs incurred by licensees to remove a facility or site safely from service and reduce residual radioactivity to levels that permit: (1) release of the property for unrestricted use and termination of the license; or (2) release of the property under restricted conditions and termination of the license. The cost of dismantling or demolishing non-radiological systems and structures is not included in the NRC decommissioning cost estimates. The costs of managing and storing spent fuel on-site until transfer to DOE are not included in the cost formulas.

2 This number is based on NUREG-1307, Rev. 14, for the burial factor (Option 2) and the December 2009 values for labor and energy factors.

Attachment 1 Schedule of the Annual Amounts Remaining to be Collected Alabama Power Company Farley Nuclear Plant Unit 1 Minimum Beginning Ending Decomm issioning Fund Fund Fund Fund Fund Year Balance Earnings Contributions Balance Estimate 2009 435,256,000 2010 281,923,125 454,842,520 2011 281,923,125 19,734,619 464,149 302,121,892 475,310,433 2012 302,121 ,892 21,148,532 464,149 323,734,574 496,699,403 2013 323,734,574 22,661,420 464,149 346,860,143 519,050,876 2014 346,860,143 24,280,210 464,149 371,604,502 542,408,165 2015 371,604,502 26,012,315 464,149 398,080,966 566,816,533 2016 398,080,966 27,865,668 464,149 426,410,783 592,323,277 2017 426,410,783 29,848,755 464,149 456,723,687 618,977,824 2018 456,723,687 31,970,658 464,149 489,158,494 646,831,826 2019 489,158,494 34,241,095 464,149 523,863,737 675,939,259 2020 523,863,737 36,670,462 464,149 560,998,348 706,356,525 2021 560,998,348 39,269,884 464,149 600,732,381 738,142,569 2022 600,732,381 42,051,267 464,149 643,247,797 771,358,985 2023 643,247,797 45,027,346 464,149 688,739,292 806,070,139 2024 688,739,292 48,211,750 464,149 737,415,191 842,343,295 2025 737,415,191 51,619,063 464,149 789,498,404 880,248,743

.2026 789,498,404 55,264,888 464,149 845,227,441 919,859,937 2027 845,227,441 59,165,921 464,149 904,857,511 961,253,634 2028 904,857,511 63,340,026 464,149 968,661,685 1,004,510,047 2029 968,661,685 67,806,318 464,149 1,036,932,152 1,049,713,000 2030 1,036,932,152 72,585,251 464,149 1,109,981,552 1,096,950,085 2031 1,109,981,552 77,698,709 464,149 1,188,144,410 1,146,312,838 2032 1,188,144,410 83,170,109 464,149 1,271,778,667 1,197,896,916 2033 1,271,778,667 89.024,507 464,149 1,361,267,323 1,251,802,277 2034 1,361,267,323 95,288,713 464,149 1,457,020,185 1,308,133,380 2035 1,457,020,185 101,991,413 464,149 1,559,475,747 1,366,999,382 2036 1,559,475,747 109,163,302 464,149 1,669,103,198 1,428,514,354 2037 1,669,103,198 116,837,224 464,149 1,786,404,571 1,492,797,500

Attachment 2 Schedule of the Annual Amounts Remaining to be Collected Alabama Power Company Farley Nuclear Plant Unit 2 Minimum Beginning Ending Decommissioning Fund Fund Fund Fund Fund Year Balance Earnings Contributions Balance Estimate 2009 435,256,000 2010 269,782,967 454,842,520 2011 269,782,967 18,884,808 402,004 289,069,778 475,310,433 2012 289,069,778 20,234,884 402,004 309,706,667 496,699,403 2013 309,706,667 21,679,467 402,004 331,788,138 519,050,876 2014 331,788,138 23,225,170 402,004 355,415,311 542,408,165 2015 355,415,311 24,879,072 402,004 380,696,387 566,816,533 2016 380,696,387 26,648,747 402,004 407,747,138 592,323,277 2017 407,747,138 28,542,300 402,004 436,691,442 618,977,824 2018 436,691,442 30,568,401 402,004 467,661,847 646,831,826 2019 467,661,847 32,736,329 402,004 500,800,180 675,939,259 2020 500,800,180 35,056,013 402,004 536,258,196 706,356,525 2021 536,258,196 37,538,074 402,004 574,198,274 738,142,569 2022 574,198,274 40,193,879 402,004 614,794,157 771,358,985 2023 614,794,157 43,035,591 402,004 658,231,752 806,070,139 2024 658,231,752 46,076,223 402,004 704,709,979 842,343,295 2025 704,709,979 49,329,699 402,004 754,441,682 880,248,743 2026 754,441,682 52,810,918 402,004 807,654,603 919,859,937 2027 807,654,603 56,535,822 402,004 864,592,430 961,253,634 2028 864,592,430 60,521,470 402,004 925,515,904 1,004,510,047 2029 925,515,904 64,786,113 402,004 990,704,021 1,049,713,000 2030 990,704,021 69,349,281 402,004 1,060,455,306 1,096,950,085 2031 1,060,455,306 74,231,871 402,004 1,135,089,182 1 ,146,312,838 2032 1,135,089,182 79,456,243 402,004 1,214,947,429 1,197,896,916 2033 1,214,947,429 85,046,320 402,004 1,300,395,753 1,251 ,802,277 2034 1,300,395,753 91,027,703 402,004 1,391,825,459 1,308,133,380 2035 1,391,825,459 97,427,782 402,004 1,489,655,245 1,366,999,382 2036 1,489,655,245 104,275,867 402,004 1,594,333,117 1,428,514,354 2037 1,594,333,117 111,603,318 402,004 1,706,338,439 1,492,797,500 2038 1,706,338,439 119,443,691 402,004 1,826,184,133 1,559,973,388 2039 1,826,184,133 127,832,889 402,004 1,954,419,027 1,630,172,190 2040 1,954,419,027 136,809,332 402,004 2,091,630,363 1,703,529,939 2041 2,091,630,363 146,414,125 402,004 2,238,446,492 1,780,188,786

Attachment 3 Material Changes to Trust Agreement December 2010 Executed Investment Management Agreement with Goldman Sachs, Fisher Investments, and Northern Trust in the Small/Mid Asset Class for the Qualified Master Nuclear Decommissioning Trust.