RS-13-255, Proposed Independent Spent Fuel Storage Installation (ISFSI) Decommissioning Funding Plan

Proposed Independent Spent Fuel Storage Installation (ISFSI) Decommissioning Funding Plan

ML13291A125
Person / Time
Site:	Zion  File:ZionSolutions icon.png
Issue date:	10/17/2013
From:	Simpson P Exelon Generation Co
To:	Document Control Desk, NRC/FSME, NRC/NMSS/SFST
References
RS-13-255, TAC J00341, TAC J00342
Download: ML13291A125 (11)

Text

4300 Winfield Road WarrenVille. IL 60555 Exelo Generation 630 657 2000 Office RS-13-255 10 CFR 72.30(b)

October 17, 2013 A TIN: Document Control Desk Director - Division of Spent Fuel Storage and Transportation Office of Nuclear Material Safety and Safeguards U.S. Nuclear Regulatory Commission Washington, DC 20555-0001 Zion Nuclear Power Station, Units 1 and 2 Facility Operating License Nos. DPR-39 and DPR-48 NRC Docket Nos. 50-295 and 50-304

Subject:

Proposed Independent Spent Fuel Storage Installation (ISFSI)

Decommissioning Funding Plan for Zion

References:

1. Letter from Thomas O'Neill (Exelon Generation Company, LLC) and John Christian (ZionSolutions, LLC) to u. S. NRC, "Application for License Transfers and Conforming Administrative License Amendments," dated January 25, 2008

2. Letter from U. S. Nuclear Regulatory Commission to John Christian (Zion Solutions, LLC), "Order Approving Transfer of Licenses and Conforming Amendments Relating to Zion Nuclear Power Station, Units 1 and 2 (TAC NOS. J00341 AND J00342)," dated May 4,2009

3. Letter from Mark Lombard (U. S. NRC), "Clarification Regarding the Timing of Submittal of a Decommissioning Funding Plan per Title 10 of the Code of Federal Regulations Section 72.30(b) for Future Independent Spent Fuel Storage Installations," dated August 21,2013 During a telephone conference call held on July 16, 2013, Exelon Generation Company, LLC (EGC) offered to provide a decommissioning funding plan for decommissioning the Zion Nuclear Power Station (ZNPS), Units 1 and 2 Independent Spent Fuel Storage Installation (ISFSI), in response to the NRC's earlier request for such a plan. EGC is not the licensee for ZNPS and is not currently responsible for decommissioning activities at ZNPS. ZionSolutions, LLC (ZS) is the licensee (see References 1 and 2) and is responsible for all decommissioning activities at ZNPS, including construction of an ISFSI and transferring the spent fuel from the spent fuel pool to the ISFSI.

October 17, 2013 U.S. Nuclear Regulatory Commission Page 2 As required by the contractual arrangements between ZS and EGC, following ZS's completion of all decommissioning activities not related to the ISFSI, ZS will have the right to transfer the license to EGC, and ZS is expected to take appropriate actions to accomplish such a transfer sometime after September 1, 2020. When the license transfers to EGC, EGC will then become responsible for decommissioning the ISFSI. As such, EGC is submitting its ISFSI decommissioning funding plan in advance of the license transfer at the NRC's request that a decommissioning funding plan be submitted prior to transferring spent fuel to the ISFSI pad.

EGC's ISFSI decommissioning funding plan addresses the requirements in 10 CFR 72.30, "Financial assurance and recordkeeping for decommissioning," and is submitted in accordance with recommendations and timing guidelines in Reference 3.

This submittal is subdivided as follows.

• Attachment 1 provides a description of the proposed ISFSI decommissioning funding plan.

• Attachment 2 provides details of the ISFSI decommissioning cost estimate.

There are no regulatory commitments contained within this letter. Should you have any questions concerning this letter, please contact Mr. Timothy A 8yam at (630) 657-2818.

Patrick R. Simpson Manager - Licensing cc: Regional Administrator- NRC Region III Attachments:

1. Proposed ISFSI Decommissioning Funding Plan

2. ISFSI Decommissioning Cost Estimate for Zion Nuclear Power Station, 2013 Dollars

ATTACHMENT 1 Proposed ISFSI Decommissioning Funding Plan

1.0 BACKGROUND

2.0

SUMMARY

DESCRIPTION 3.0 DETAILED DESCRIPTION 3.1 Reasonable Assurance of Funds Availability 3.2 Detailed Cost Estimate 3.3 Assumptions 3.4 Method of Assurance 3.5 Volume of Subsurface Residual Radioactivity Requiring Remediation 3.6 Certification of Financial Assurance

4.0 REFERENCES

Page 1

ATTACHMENT 1 Proposed ISFSI Decommissioning Funding Plan

1.0 BACKGROUND

On January 25,2008, Exelon Generation Company, LLC (EGC) submitted an Application for License Transfers and Conforming Administrative License Amendments (referred to as "License Transfer Application") in accordance with Section 184 of the Atomic Energy Act and 10 CFR 50.80, "Transfer of licenses," (Reference 1). In that License Transfer Application, EGC requested that the NRC transfer EGC's Facility Operating License Nos. DPR-39 and DPR-48 (the "Licenses") for Zion Nuclear Power Station (ZNPS), Units 1 and 2, to ZionSolutions, LLC (ZS). On May 4, 2009, the NRC issued an order approving the license transfers (Reference 2).

Upon transfer of the Licenses, ZS assumed all decommissioning responsibilities and obligations for ZNPS, including constructing an Independent Spent Fuel Storage Installation (ISFSI) and moving the spent fuel from the spent fuel pool to the ISFSI, where pursuant to current plans the fuel will be stored until final disposition of the fuel off-site. ZS currently projects completing all of its decommissioning activities on or around September 1, 2020.

Once ZS has satisfied the terms and conditions of the contractual arrangements between ZS and EGC, ZS will have the right to transfer the ZNPS Licenses to EGC. At that pOint, ZS is expected to take the actions necessary to transfer the Licenses to EGC, fOllowing which EGC will assume responsibility for decommissioning the ISFSI.

EGC submits for review and approval its decommissioning funding plan for decommissioning the ISFSI after the ISFSI is transferred to EGC in 2020.

2.0

SUMMARY

DESCRIPTION EGC maintains a cost estimate that includes decommissioning the ISFSI after the Department of Energy (DOE) takes possession of the fuel or the fuel is otherwise disposed of at a location off-site. The cost estimate is periodically updated. EGC provides the following information from its cost estimate to support its decommissioning funding plan for the ZNPS ISFSI.

EGC notes that radiological decommissioning costs for ISFSls typically consist of the costs associated with removing and disposing of small volumes of neutron-activated concrete and certain structural steel components. No impact is expected upon soil and groundwater at ZNPS during the storage periods contemplated in the cost estimate. EGC also notes that induced radioactivity at the ZNPS ISFSI is not expected to result in residual radioactivity in excess of 25 mRem/yr in an unrestricted release scenario, were no action to be taken to remediate the site.

Page 2

ATTACHMENT 1 Proposed ISFSI Decommissioning Funding Plan However, since EGC anticipates small, but measurable amounts of induced radioactivity to be present, and release of this material from ZNPS will require it to be disposed of at a NRC licensed radioactive waste disposal facility, EGC has included these costs in its cost estimate.

3.0 DETAILED DESCRIPTION 3.1 Reasonable Assurance of Funds Availability In the License Transfer Application (Reference 1), EGC described the terms of the sale agreement between EGC and ZS pursuant to which ZS assumed responsibility for decommissioning ZNPS, including construction of an ISFSI and transfer of the spent fuel to the ISFSI (Reference 1, Attachment 1, p. 5). Following completion of ZS's decommissioning activities, ZS will take such actions as are required to transfer the Licenses back to EGC. The NRC approved the sale agreement and corresponding license transfers in an order dated May 4, 2009 (Reference 2).

As explained in the License Transfer Application, EGC transferred to ZS the funds from the ZNPS Qualified and Non-Qualified Decommissioning Trust Funds, except for withdrawals for decommissioning costs already incurred, payment of taxes, and

$25 million that EGC retained and segregated in its Non-Qualified Decommissioning Fund "for the purpose of funding the maintenance and decommissioning of the ISFSI" and other potential activities following transfer of the Licenses to EGC (Reference 1, Attachment 1, pp. 10 and 11). The $25 million that EGC segregated in its Non-Qualified Decommissioning Trust Fund will be used by EGC to fund ISFSI activities, including decommissioning of the ISFSI after ZS completes the decommissioning of the rest of the ZNPS site, or until the transfer and maintenance of spent nuclear fuel and Greater than Class C (GTCC) radioactive waste off-site, if such an option is pursued (Reference 1, Attachment 1, p. 4).

The amount segregated in the EGC Non-Qualified Trust Fund currently exceeds the estimated site-specific costs required for ISFSI decommissioning. Table 1 shows the trust fund assets and the costs estimated for ISFSI decommissioning as required under 10 CFR 72.30(b), as of August 31, 2013.

3.2 Detailed Cost Estimate The detailed cost estimate was developed to estimate the costs for decommissioning the ISFSI. The analysis relies upon site-specific information reflecting current assumptions pertaining to the disposition of the spent fuel and the design of spent fuel dry storage facilities.

Page 3

ATTACHMENT 1 Proposed ISFSI Decommissioning Funding Plan The cost estimate assumes that once decommissioning and demolition of ZNPS is complete, currently scheduled to occur on September 1 , 2020, the site NRC Licenses and responsibility for the ISFSI will be transferred from ZS to EGC. The cost estimate also assumes that the DOE will take possession of the spent nuclear fuel in 2031. Once transfer of the spent fuel to the DOE is complete (anticipated in 2031), decommissioning and dismantling of the ISFSI structures and grounds, consisting of an ISFSI pad, a transfer station, a storage building, security barriers, and a roadway between the ISFSI and rail spur, will take place. The radiological decommissioning scope of the ZNPS ISFSI includes:

• Characterizing the emptied concrete casks after the spent fuel has been transferred

• Demolishing the concrete casks, transfer cask, ISFSI concrete pads, storage bUilding, security barriers, earthen berm and roadways

• Disposing of any radioactive materials that exceed the release criteria

• Performing a final status survey

• EGC staff and overhead associated with management and oversight of the contractor performing final status survey and demolition Substantial costs associated with the ISFSI decommissioning include plant staff for engineering, security, planning, and project management, nuclear liability and nuclear property insurance, property taxes, and annual NRC licensing fees and associated costs. The Characterization Survey is assumed to be performed by existing site staff with some staff augmentation. Demolition work will be contracted out to a local demolition contractor. Demolition work activities used for the cost basis are listed below:

• Mobilization

• Transfer cask

• Fuel transfer station

• Concrete casks

• Fencing

• Peripheral buildings

• ISFSI pads and foundations

• Berm

• Roadways and drainage

• General conditions

• Recycle concrete

• Scrap steel

• Dispose of activated concrete

• Dispose of activated steel Page 4

ATTACHMENT 1 Proposed ISFSI Decommissioning Funding Plan Consistent with standard cost estimating practice, contingencies are applied to the ISFSI decontamination and dismantling costs. The contingency values used in the cost estimate were developed dependent upon the degree of difficulty judged to be appropriate from actual decommissioning experience and are as follows:

• Contaminated component packaging 10%

• Contaminated component transport 15%

• Low-level radioactive waste disposal 25%

• Heavy equipment and tooling 15%

• Engineering 15%

• Characterization and termination surveys 30%

• Taxes and fees 10%

• Insurance 10%

• Staffing 15% details the cost estimates of ISFSI decommissioning in 2013 dollars in accordance with 10 CFR 72.30 requirements. Attachment 2 shows these costs for EGC performing this work (discussed further in the assumptions below), with an adequate contingency factor, to meet the 10 CFR 20.1402 criteria for unrestricted use.

3.3 Assumptions EGC has made the following assumptions within the ZNPS cost estimate with respect to the site ISFSI decommissioning:

1. Decommissioning costs in Attachment 2 are escalated at 3.5% per annum into 2013 dollars.

2. All values in Table 1 are at 100% ownership share. Costs are for decommissioning the ISFSI site at ZNPS.

3. Decommissioning costs for the ISFSI are expected to be incurred beg inn i n g in the year in which DOE has accepted all spent fuel from the site for disposal. For the purposes of the cost estimate, the transfer of the spent fuel to the DOE is assumed to be completed in 2031. As part of the periodic updates to the cost estimate, this assumption is revised as necessary.

3.4 Method of Assurance In accordance with 10 CFR 72.30(b)(4), Table 1 describes the method of assuring funds for ISFSI decommissioning, from 10 CFR 72.30(e). EGC periodically PageS

ATTACHMENT 1 Proposed ISFSI Decommissioning Funding Plan updates the cost estimate associated with the site-specific assurance method.

3.5 Volume of Subsurface Residual Radioactivity Requiring Remediation Per review of site-specific 10 CFR 50.75(g) logs, EGC has not identified any onsite, subsurface material containing residual radioactivity at ZNPS in the vicinity of the ISFSI.

3.6 Certification of Financial Assurance In accordance with 10 CFR 72.30(b), financial assurance for decommissioning the ISFSI has been provided in an amount that equals or exceeds the cost estimate for ISFSI decommissioning, as demonstrated in Table 1.

4.0 REFERENCES

1. Letter from Thomas O'Neill (Exelon Generation Company, LLC) and John Christian (Zion Solutions, LLC) to U. S. NRC, "Application for License Transfers and Conforming Administrative License Amendments," dated January 25, 2008

2. Letter from U. S. Nuclear Regulatory Commission to John Christian (Zion Solutions, LLC), "Order Approving Transfer of Licenses and Conforming Amendments Relating to Zion Nuclear Power Station, Units 1 and 2 (TAC NOS.

J00341 AND J00342), " dated May 4, 2009

3. Letter from Mark Lombard (U. S. NRC), "Clarification Regarding the Timing of Submittal of a Decommissioning Funding Plan per Title 10 of the Code of Federal Regulations Section 72.30(b) for Future Independent Spent Fuel Storage Installations," dated August 21, 2013 PageS

ATTACHMENT 1 Proposed ISFSI Decommissioning Funding Plan TABLE 1 EGC Zion Nuclear Power Station ISFSI Decommissioning Financial Assurance Summary Total EGC Trust Fund Part 72.30 Site Trust Fund Assets Allocated Specific Parent Assets, 2013 for ISFSI Annual Decommissioning Method of Company dollars Decommissioning, Contributions Cos 2013 dollars Assurance Guarantee (Thousands $) 2013 dollars (Thousands $)

(Thousands $)

10CFR

$45,667

$45.667 $9,8651 $0 $0 $14,183 72.30(e)(1 )}

1 The remaining funds have been allocated tor for spent fuel management.

The expenditures for the Zion ISFSI decommissioning activities are expected to occur based on the following cash flows in Table 2 below, expressed in 2013 thousands of dollars, with a 2% rate of earnings assumed for trust fund earnings:

TABLE 2 Zion Nuclear Power Station ISFSI Decommissioning Annual Cash Flows BOY Trust BOY Trust Trust Fund EOY Trust ISFSI Fund Value Fund Value Earnings Fund Value Decommissioning (thousands} Less Cost (thousands} (thousands}

Cost (thousands)

(thousands}

2013 dollars Year {thousands)

(thousandsl 2013 $- $9,865 $9,865 $66 $9,931 2014 $- $9,931 $9,931 $199 $10,130 I 2015 $- $10,130 $10,130 $203 $10,332 2016 $- $10,332 $10,332 $207 $10,539 2017 $- $10,539 $10,539 $211 $10,750 2018 $- $10,750 $10,750 $215 $10,965 2019 $- $10,965 $10,965 $219 $11,184 2020 $- $11,184 $11,184 $224 $11,408 2021 $- $11,408 $11,408 $228 $11,636 2022 $- $11,636 $11,636 $233 $11,869 2023 $- $11,869 $11,869 $237 $12,106 2024 $- $12,106 $12,106 $242 $12,348 2025 $- $12,348 $12,348 $247 $12,595 2026 $- $12,595 $12,595 $252 $12,847 2027 $- $12,847 $12,847 $257 $13,104 2028 $- $13,104 $13,104 $262 $13,366 2029 $- $13,366 $13,366 $267 $13,633 2030 $- $13,633 $13,633 $273 $13,906 2031 $55 $13,906 $13,852 $277 $14,129 2032 $14,129 _ _ ~4,129 $14,129 -

$--= - --

$- -- - ~-

ATTACHMENT 2 ISFSI Decommissioning Cos t Estimate for Zion Nuclear Power Station, 2013 dollars Equipment Labor & Materials Burial Other Contingencl£ Total Activity Costs Costs Costs Costs Costs Cost ISFSI Decommissioning Staffing 707,080 106,062 813,143 Characterize ISFSI 1,734,062 291,763 205,701 669,458 2,900,983 Security 584,278 87,642 671,920 Insurance 415,407 41,541 456,948 NRC Fees 164,206 16,420 180,626 Property Taxes 381,271 38,127 419,398 Demolish ISFSI Mobilization 75,963 2,006 1,723 11,954 91,645 Transfer Cask 2,874 1,652 679 5,205 Fuel Transfer Station 12,434 9,822 3,338 25,594 Concrete Casks 142,698 174,720 47,613 365,031 Fencing 12,162 8,013 3,026 23,201 Peripheral Buildings 4,795 2,614 1,111 8,519 ISFSI Pad & Foundations 127,823 198,945 49,015 375,783 Berm 28,742 19,146 7,183 55,071 Roadways & & Drainage 16,922 7,402 3,649 27,973 General Conditions 138,n4 87,037 33,872 259,683 Recycle Concrete 294,576 416,952 n5,500 223,055 1,710,083 Dispose of Activated Concrete 14,575 129,534 1,405,957 676,340 440,739 2,667,146 Dispose of Activated Steel 13,n2 134,703 1,448,562 696,836 454,095 2,747,969 License Termination Final Status Survey 188,127 7,505 36,394 69,608 301,634 NRC Confirmation Survey 51,266 6,874 17,442 75,581 TOTAL: 4,150,922 1,491,814 2,854,519 3,360,252 2,325,629 14,183,135