ML13296A023
| ML13296A023 | |
| Person / Time | |
|---|---|
| Site: | North Anna  |
| Issue date: | 10/21/2013 |
| From: | Brickhouse T Old Dominion Electric Cooperative |
| To: | Document Control Desk, Office of Nuclear Material Safety and Safeguards |
| References | |
| Download: ML13296A023 (9) | |
Text
Your Toudctone Energy' Partner October 21, 2013 U.S. Nuclear Regulatory Commission ATTN: Document Control Desk 1 White Flint North Docket Nos. 72-16, 72-56, 11555 Rockville Pike License Nos. NPF-4, NPF-7 Rockville, MD 20852-2738 OLD DOMINION ELECTRIC COOPERATIVE 10 CFR 72.30 DECOMMISSIONING FUNDING PLAN: CORRECTION NOTICE TO "RESPONSE TO REQUEST FOR ADDITIONAL INFORMATION, dated September 30, 2013 Old Dominion Electric Cooperative (ODEC) submitted a response to request for additional information in the above referenced filing on September 30, 2013. ODEC subsequently identified an administrative error in the body of the response to RAI #1 and Table 2 of the response to RAI #2. ODEC is providing the corrected information in this letter. This correction notice does not change the decommissioning funding plan (DFP) for the North Anna Power Station (NAPS) Independent Spent Fuel Storage Installation (ISFSI).
Please contact me at (804) 968-4012 if you have any questions or require additional information.
Sincerely, Todd T. Brickhouse Vice President - Treasurer Attachments Commitments made in this letter: None Old Dominion Electric Cooperative 4201 Dominion Boulevard
- Glen Allen, Virginia 23060 Tel: 804-747-0592
- Fax: 804-747-3742
.-0LAS~a4Lp www.odec.coni
ISFSI DFP RAI - Correction Notice Page 2 of 2 cc:
Kristina Banovac NRC Project Manager Division of Spent Fuel Storage and Transportation U.S. Nuclear Regulatory Commission, Mail Stop 08 G-9A One White Flint North 11555 Rockville Pike Rockville, MD 20852-2738 Dr. V. Sreenivas NRC Project Manager North Anna U.S. Nuclear Regulatory Commission, Mail Stop 08 G-9A One White Flint North 11555 Rockville Pike Rockville, MD 20852-2738 Ms. K. R. Cotton NRC Project Manager North Anna U.S. Nuclear Regulatory Commission, Mail Stop 08 G-9A One White Flint North 11555 Rockville Pike Rockville, MD 20852-2738 Ms. J. Davis NRC Senior Project Manager (SPS/NAPS ISFSls)
U. S. Nuclear Regulatory Commission, Mail Stop EBB-3D-02M One White Flint North 11555 Rockville Pike Rockville, MD 20852-2738
Attachment 1 RAI #1: Decommissioning Costs Development of and Allocation of Costs for ISFSI Radiological Decommissioninq Cost Estimate
RAI #1: Decommissioninq Costs - NRC Question "On December 13, 2012 ODEC provided the decommissioning cost estimate for the NAPS ISFSI. The estimate is stated to be derived from the referenced decommissioning cost estimate for NAPS; however, copies of, or ADAMS references to, the estimates were not made available for analysis.
Under 10 CFR 72.30(b)(2):
Each holder of, or applicant for, a license under this part must submit for NRC review and approval a decommissioning funding plan that must contain: ... A detailed cost estimate for decommissioning, in an amount reflecting: (i) The cost of an independent contractor to perform all decommissioning activities; (ii)An adequate contingency factor; and (iii) The cost of meeting the § 20.1402 of this chapter criteria for unrestricted use, provided that, if the applicant or licensee can demonstrate its ability to meet the provisions of § 20.1403 of this chapter, the cost estimate may be based on meeting the § 20.1403 criteria.
The NRC staff needs the decommissioning cost estimates for NAPS to determine how the ISFSI decommissioning cost estimate was derived. The NRC also needs to understand how the licensee determined the appropriate allocation of costs specific to the radiological decommissioning of the ISFSI. The information that the licensee submitted does not show how it calculated the cost of an independent contractor to perform the decommissioning activities or the cost to decommission to unrestricted use levels in 10 CFR 20.1402. This detailed cost estimate information is needed to determine compliance with 10 CFR 72.30(b)(2).
Therefore, please provide the most recent decommissioning cost estimate for NAPS or, if previously submitted to NRC, reference the ADAMS Accession Number or the date submitted to the NRC. Also, please discuss how you determined the appropriate allocation of costs specific to radiological decommissioning of each ISFSI, based on the respective reactor decommissioning cost estimate.
This information is needed to verify compliance with 10 CFR 72.30(b)(2)."
RAI #1: Decommissionina Costs - ODEC ResDonse General Methodology Used to Develop ISFSI Decommissioning Cost Estimates As stated in its December 13, 2012 filing, ODEC used existing site specific decommissioning cost studies to develop the ISFSI decommissioning cost estimate (DCE) for each site. ODEC used as a starting point a cost estimate which did not include contingency and was based on the assumption that a third party contractor would perform decommissioning. To determine the cost of using a third party contractor, fully burdened labor rates (labor costs plus employee benefits and taxes) were used as a basis and a premium was added to represent a third party contractor's profit margin. This amount served as a proxy for the cost of a third party contractor performing decommissioning.
The amounts identified as associated with ISFSI decommissioning in the site specific cost studies included amounts for activities unrelated to radiological decommissioning (such as, demolition costs for concrete structures). Therefore, only activities relating to radiological decommissioning were included in the ISFSI decommissioning cost estimates. Costs associated with line items in the site specific cost estimate not applicable to ISFSI decommissioning (based on 10 CFR 72.30 requirements) were either adjusted or excluded.
Adjusted or excluded costs were identified in the assumptions contained in the December 13, 2012 filing.
The site specific decommissioning cost studies also included undistributed costs (for support activities and costs such as staff, security, insurance, energy, materials and services, and taxes) allocated to the entire ISFSI decommissioning period. Because the ISFSI decommissioning period accounted for non-radiological decommissioning activities, it was necessary to adjust the undistributed costs for this period to assign only an appropriate portion for radiological decommissioning. Most of the undistributed costs were adjusted in proportion to the ratio of the duration of radiological ISFS1 decommissioning activities to the duration of the ISFSI decommissioning period, but some were adjusted on the basis of judgment. The undistributed costs for the dry storage period preceding the ISFSI decommissioning period were also considered (because certain ISFSI decommissioning activities were included in this preceding period), but were discounted as applying predominantly to the storage activities.
The applicable direct costs and allocated undistributed costs were subtotaled and a 25%
contingency percentage was added to the subtotal amount to arrive at a total ISFSI DCE amount.
As stated in ODEC's December 13, 2012 filing, the site specific DCE for NAPS was most recently updated in 2009. ODEC used this existing study to develop the cost estimate for decommissioning the NAPS ISFSIs. The study was in 2008 dollars and used NRC prescribed indices to arrive at a 4.63% annual escalation rate which was applied to the 2008 dollars to restate the ISFSI decommissioning cost in 2012 dollars as $.201 million as stated in the December 13, 2012 ISFSI DCE filing -ADAMS Accession Number ML12353A032.
Attachment 2 RAI #2: Certification of Financial Assurance Development of and Allocation of Costs for ISFSI Radioloqical Decommissionina Cost Estimate
RAI #2: Certification of Financial Assurance - NRC Question "On December 13, 2012, ODEC stated:
Pursuant to 10 CFR § 50.75, the methods of 10 CFR § 50.75(b), 50.75(e) and 50.75(h) provide requisite financial assurance for decommissioning of the NAPS ISFSL.
Pursuant to these requirements, ODEC provides financial assurance for its decommissioning responsibility of NAPS in the amount not less than ODEC's share of the amount required by 10 CFR § 50.75(b), using an external sinking fund permitted by 10 C.F.R. § 50.75(e), under trust agreements complying with 50.75(h). This funding assurance, coupled with the regular reporting required by 10 CFR § 50.75(f)(1) and 72.30(c), the annual adjustments required by 10 CFR 50.75(b)(2), and the further adjustments required by 10 CFR 50.75(f)(3) and (5) at or about five years prior to the projected end of reactor operations, provide reasonable assurance that funds will be available to decommission the ISFSI.
Financial assurance for the NAPS ISFSI is provided by the methods of 10 CFR § 50.75(b), 50.75(e) and 50.75(h), as permitted by 10 CFR § 72.30(e)(5) and as discussed above. The amount of financial assurance required by 10 CFR 50.75(b) is subject to annual adjustment in accordance with paragraph (2) of that section, and further adjustment is required by 10 CFR 50.75(f)(3) and (5) at or about five years prior to the projected end of reactor operations. ISFSI decommissioning cost estimates will be updated as necessary in the decommissioning funding plans required to be resubmitted every three years pursuant to 10 CFR § 72.30(c).
ODEC hereby certifies that, as evidenced by ODEC's March 31, 2011, Biennial Decommissioning Funding Status Report, filed pursuant to 10 CFR 50.75(f)(1),
financial assurance for decommissioning NAPS has been provided in an amount that meets or exceeds ODEC's share of the amount required by 10 CFR 50.75(b), which pursuant to 10 CFR 72.30(e)(5) provides the requisite financial assurance for ODEC's decommissioning percentage share of the ISFS1 decommissioning cost.
If ODEC believes that a license's compliance with 10 CFR 50.75(b) for an operating reactor site means that the licensee also complies with 10 CFR 72.30(e)(5), then ODEC is not applying § 72.30(e)(5) correctly. Under § 72.30(e)(5), licensees can use the financial assurance methods in 10 CFR 50.75(b), (e), and (h), as applicable, to satisfy § 72.30, but the funds set aside to cover the costs of decommissioning the ISFS1 cannot be the same funds the licensee will use for the Part 50 decommissioning. In other words, the funds necessary to satisfy the Part 50 reactor decommissioning financial assurance requirements do not include the costs for ISFSI decommissioning. A licensee can hold ISFSI decommissioning and reactor decommissioning funds in the same financial instrument, but the licensee must be able to show that ISFSI decommissioning and reactor decommissioning funds are separately maintained. Also, 10 CFR 72.30(e)(5) references "the financial assurance methods in 10 CFR 50.75(b), (e), and (h), as applicable," but does not reference 10 CFR 50.75(f), which concerns
reactor decommissioning cost estimates. Your reliance on 10 CFR 50.75(f) to help meet the requirements of § 72.30 is therefore misplaced.
For the above reasons, your certification does not meet the 10 CFR 72.30(b) requirements, under which a licensee must certify that financial assurance for decommissioning its ISFSI has been provided. This certification must show that such financial assurance equals the amount of the ISFSI decommissioning cost estimate. Specifically, under 10 CFR 72.30(b)(4):
Each holder of, or applicant for a license under this part must submit for NRC review and approval a decommissioning funding plan that must contain:... A description of the method of assuring funds for decommissioning from paragraph (e) of this section, including means for adjusting cost estimates and associated funding levels periodically over the life of the facility.
Further, under 10 CFR 72.30(b)(6):
Each holder of, or applicant for, a license under this part must submit for NRC review and approval a decommissioning funding plan that must contain: ... A certification that financial assurance for decommissioning has been provided in the amount of the cost estimate for decommissioning.
It is not evident from either your Decommissioning Funding Status reports submitted in 2011 or your ISFSI-related submission of December 13, 2012, that funds specific to ISFSI decommissioning are accounted for within your decommissioning trust accounts. Accordingly, the NRC staff cannot determine whether funds for ISFSI decommissioning reside within your trust accounts and whether ODEC is in compliance with 10 CFR 72.30(b).
Therefore, provide the breakdown of the decommissioning trust funds for your portion of the NAPS ISFSI, including subaccounts titles and funding levels. If the funds from a Part 50 external sinking fund are to be used for Part 72 decommissioning, the NRC staff must be able to determine that adequate funds for ISFSI decommissioning reside within your external sinking fund. Moreover, these funds need to be reported separately for the ISFSI and be identified as a'separate line item. Also identify all additional funding methods or mechanisms that are currently being used (such as a parent company guarantee) to supplement the external sinking fund or other ISFSI decommissioning funding method(s) being used, and the current funding amounts in, or represented by, all such funding methods. For all such funding methods, funds may be held in a separate subaccount that is identified for ISFSI decommissioning.
This information is needed to verify compliance with 10 CFR 72.30(b)."
RAI #2: Certification of Financial Assurance - ODEC Response ODEC provides financial assurance for the decommissioning of North Anna using the external sinking fund method. Its collections are based on site specific cost estimates that include radiological decommissioning, spent fuel management (including ISFSI decommissioning) and site restoration.
The following table shows the Total Funds and Allocated Radiological Funds accumulated as of December 31, 2012 and in future dollars for North Anna Units. The table shows that the funds available for ISFSI Decommissioning, Spent Fuel Management and Site Restoration exceed the ISFSI (DCE) amounts.
Unit Total Total Funds Allocated Allocated NRC Funds Available ISFSls Funds in in External Radiological Radiological Minimum ISFSIs Decom, DCE External Trusts Funds in Funds in Spent Fuel Mgt Trusts External External &Site End of License Trusts Trusts Restoration Year (2012 $) (Future $)(1) (2012 $) (Future $)(2) (Future $)(3) (2012 $)(4) (2012 $)(')
North Anna $56.1 $268.4 $39.7 $110.8 $255.6 $16.4 Unit 1 million million million million million million 2038 1 1 1 $.201 North Anna $57.2 $317.2 $40.5 $113.1 $260.8 $16.7 million Unit 2 million million million million million million 2040 1 Total Funds in External Trust (Future $) = 7.6% Rate of Return applied to Growth of Funds in the External Trust to 3.5 years after Start of Decommissioning for each unit.
(2) Allocated Radiological Funds in External Trust (Future $) = 7.6% Rate of Return applied to Growth of Funds in the External Trust to 3.5 years after Start of Decommissioning for each unit as reported in the March 27, 2013 biennial filing.
(3) NRC Minimum (Future $) = NRC Minimum amount reflects December 31, 2012 NRC Minimum Amount due to the application of a 7.6% Rate of Return to Growth of Funds in the External Trust and keeping the NRC Minimum amount constant as reported in the March 27, 2013 biennial filing. - see note (2).
(4) Funds Available for ISFSI Decommissioning, Spent Fuel Management & Site Restoration (2012 $) is calculated as the difference between Total Funds in External Trusts (2012 $) and Allocated Radiological Funds in External Trusts (2012 $).
(5) ISFSI DCE amount as reported in the December 13, 2012 ISFSI DCE filing.