3F0319-01, Annual Decommissioning and Irradiated Fuel Management Financial Status Report for 2018

Annual Decommissioning and Irradiated Fuel Management Financial Status Report for 2018

ML19086A046
Person / Time
Site:	Crystal River
Issue date:	03/27/2019
From:	Hobbs T Duke Energy Florida
To:	Document Control Desk, Office of Nuclear Material Safety and Safeguards, Office of Nuclear Reactor Regulation
References
3F0319-01
Download: ML19086A046 (9)

Text

Crystal River Nuclear Plant 15760 W. Power Line Street Crystal River, FL 34428 Docket 50-302 Docket 72-1035 Operating License No. DPR-72 10 CFR 50.82 10 CFR 50.75 March 27, 2019 3F0319-01 U.S. Nuclear Regulatory Commission Attn: Document Control Desk Washington, DC 20555-0001

Subject:

Crystal River Unit 3 - Annual Decommissioning and Irradiated Fuel Management Financial Status Report for 2018

References:

1. NRC to CR-3 letter dated March 13, 2013, Crystal River Unit 3 Nuclear Generating Plant Certification of Permanent Cessation of Operation and Permanent Removal of Fuel from the Reactor (ADAMS Accession No. ML13058A380)

2. CR-3 to NRC letter dated December 2, 2013, Crystal River Unit 3 - Post-Shutdown Decommissioning Activities Report (ADAMS Accession No. ML13340A009)

3. NRC to CR-3 letter dated January 26, 2015, Crystal River Unit 3 Nuclear Generating Plant - Exemptions from the Requirements of 10 CFR Part 50, Sections 50.82(a)(8)(i)(A) and 50.75(h)(2) (ADAMS Accession No. ML14247A545)

4. NRC to CR-3 letter dated March 11, 2015, Crystal River Unit 3 Nuclear Generating Plant Post-Shutdown Decommissioning Activities Report (ADAMS Accession No. ML14321A751)

5. CR-3 to NRC letter dated June 28, 2018, Crystal River Unit 3 - 2018 Decommissioning Cost Estimate (ADAMS Accession No. ML18178A181)

Dear Sir:

In accordance with 10 CFR 50.75(f)(1), 10 CFR 50.82(a)(8)(v), 10 CFR 50.82(a)(8)(vi), and 10 CFR 50.82(a)(8)(vii), Duke Energy Florida, LLC, (DEF) is submitting the annual status of decommissioning funding, status of funding for managing irradiated fuel, and the financial assurance status report for 2018. In Reference 1, the NRC acknowledged Crystal River Unit 3 Nuclear Generating Plant (CR-3) certification of permanent cessation of power operation and permanent removal of fuel from the reactor vessel. In Reference 2, DEF submitted its Post-Shutdown Decommissioning Activities Report (PSDAR) containing a site-specific Decommissioning Cost Estimate (DCE) pursuant to 10 CFR 50.82(a)(4)(i) and 10 CFR 50.82(a)(8)(iii). Accordingly, a status of decommissioning funding pursuant to 10 CFR 50.75(f)(1), a financial assurance status report pursuant to 10 CFR 50.82(a)(8)(v) and 10 CFR 50.82(a)(8)(vi), and a report on the status of the funding for managing irradiated fuel pursuant to 10 CFR 50.82(a)(8)(vii) are required to be submitted by March 31 of each year.

U. S. Nuclear Regulatory Commission Page 2 of 3 3F0318-01 In Reference 3, the NRC provided its approval of the CR-3 exemption request to use the funds from the CR-3 Decommissioning Trust Funds for Irradiated Fuel Management and Site Restoration Costs. The financial assurance demonstration performed in this submittal has been prepared consistent with that exemption request. In Reference 4, the NRC found that the PSDAR contained the necessary information required by 10 CFR 50.82(a)(4)(i) and was consistent with the guidance of Regulatory Guide 1.185.

In Reference 5, DEF submitted an updated site-specific DCE that reflects current plant conditions, assumptions pertaining to the disposition of the nuclear unit and relevant industry experience in undertaking such projects. This update was performed at the request of Duke Energy management to verify sufficient funds remain to continue to demonstrate financial assurance and was not performed to satisfy any NRC regulation. The cash flows in this updated DCE are being used by DEF as the basis for demonstrating funding status in this Annual Decommissioning and Irradiated Fuel Management Financial Status Report, submitted pursuant to 10 CFR 50.75 (f)(1) and 10 CFR 50.82(a)(8)(v) - (vii).

The attachments to this letter contain the information required by the above regulations for DEF.

The report contains the following required information:

(1) The amount of decommissioning funds estimated to be required pursuant to 10 CFR 50.75(b) and (c), (While DEF is identifying this amount because it is specified in 10 CFR 50.75(f)(1), it does not appear applicable to a plant that has permanently ceased operation, has submitted a site specific cost estimate, and is engaged in decommissioning.)

(2) The amount of decommissioning funds accumulated to the end of the calendar year preceding the date of this report, (3) A schedule of annual amounts remaining to be collected, (4) The assumptions used regarding rates of escalation in decommissioning costs, rates of earnings on decommissioning funds, and rates of other factors used in funding projections, (5) Any contracts upon which the licensee is relying pursuant to 10 CFR 50.75(e)(1)(v),

(6) Any modifications occurring to a licensees current method of providing financial assurance since the last submitted report, (7) Any material changes to trust agreements or financial assurance contracts, (8) The amount spent on decommissioning, both cumulative and over the previous calendar year, (9) The remaining balance of any decommissioning funds, (10) The amount provided by other financial assurance methods being relied upon, (11) An estimate of the costs to complete decommissioning, reflecting any difference between actual and estimated costs for work performed during the year, (12) The decommissioning criteria upon which the estimate is based, (13) If the sum of the balance of any remaining decommissioning funds, plus earnings on such funds calculated are not greater than a 2 percent real rate of return, together with the amount provided by other financial assurance methods being relied upon, does not cover the estimated costs to complete the decommissioning, the financial assurance status report must include additional financial assurance to cover the estimated cost of completion, (14) The amount of funds accumulated to cover the cost of managing the irradiated fuel,

U.S. Nuclear Regulatory Commission Page 3 of 3 3F0318-01 (15) The projected cost of managing irradiated fuel until title to the fuel and possession of the fuel is transferred to the Secretary of Energy, and (16) If the funds accumulated do not cover the projected cost (of irradiated fuel), a plan to obtain additional funds to cover the cost.

The adjustment factors for labor rates and energy costs used in Item (1) for the calculation in 10 CFR 50.75(c)(2) are determined using the December 2018 indices from the U.S. Department of Labor, Bureau of Labor Statistics. The adjustment factor for the cost of low-level waste burial charges used in Item (1) for the calculation in 10 CFR 50.75(c)(2) is determined using NUREG-1307, Revision 17, "Report on Waste Burial Charges."

There are no new regulatory commitments associated with this letter.

If you have any questions regarding this submittal, please contact Mr. Mark Van Sicklen, Licensing Lead, Nuclear R gulatory Affairs, at (352) 501-3045.

General Manager, Decommissioning TDH/mvs Attachments:

Attachment 1 - Duke Energy Florida, Crystal River Unit 3 Funding Status Report Attachment 2 - Crystal River Unit 3, Estimate of Costs to Complete Decommissioning and Financial Assurance Demonstration xc: NMSS Project Manager Regional Administrator, Region I

DUKE ENERGY FLORIDA, LLC DOCKET NUMBER 50 - 302 / LICENSE NUMBER DPR - 72 ATTACHMENT 1 DUKE ENERGY FLORIDA, CRYSTAL RIVER UNIT 3 FUNDING STATUS REPORT

Attachment 1, Page 1 of 2 NRC Decommissioning Funding Status Report Report Dated as of December 31, 2018 Duke Energy Florida Crystal River Unit 3 100% Ownership Crystal River Item # Unit 3 10 CFR 50.75(f)(1) - Status of decommissioning funding 1 1a. The amount of decommissioning funds estimated to be required pursuant to 10 CFR 50.75(b) and (c); $ 474,162,767 1

1b. The amount of decommissioning funds estimated to be required for $ 746,689,950 remaining License Termination costs.

2,3 2 The amount of decommissioning funds accumulated to the end of the $ 666,240,035 calendar year preceding the date of the report; 3 A schedule of the annual amounts remaining to be collected; None 4

4 The assumptions used regarding rates of escalation in decommissioning inflation 2.8%

4 costs, rates of earnings on decommissioning funds, and rates of other qualified rate of return 5.10%

factors used in funding projections; 5 Any contracts upon which the licensee is relying pursuant to None paragraph 10 CFR 50.75(e)(1)(v);

6 Any modifications occurring to a licensee's current method of providing None financial assurance since the last submitted report; and 7 Any material changes to trust agreements. None 10 CFR 50.82(a)(8)(v) - Financial assurance status report 5

8 (A) The amount spent on decommissioning, both cumulative and over the $ 17,786,730 - Previous calendar year previous calendar year, 6

$ 96,542,812 - Cumulative 2,3 9 The remaining balance of any decommissioning funds, and $ 666,240,035 10 The amount provided by other financial assurance methods being relied upon; None 11 (B) An estimate of the costs to complete decommissioning, reflecting any See Attachment 2 difference between actual and estimated costs for work performed during the year, and 12 The decommissioning criteria upon which the estimate is based; Unrestricted Release 13 (C) Any modifications occurring to a licensee's current method of providing financial assurance since the last submitted report; and None 14 (D) Any material changes to trust agreements or financial assurance contracts. None 10 CFR 50.82(a)(8)(vi) 15 If the sum of the balance of any remaining decommissioning funds, plus As demonstrated in Attachment 2, funds accumulated earnings on such funds calculated at not greater than a 2 percent real rate of cover estimated cost of completion.

return, together with the amount provided by other financial assurance methods being relied upon, does not cover the estimated cost to complete the decommissioning, the financial assurance status report must include additional financial assurance to cover the estimated cost of completion.

10 CFR 50.82(a)(8)(vii) - Report on the status of funding for managing irradiated fuel 16 (A) The amount of funds accumulated to cover the cost of managing the irradiated fuel; As demonstrated in Attachment 2, funds accumulated cover estimated cost of completion.

17 (B) The projected cost of managing irradiated fuel until title to the fuel See Attachment 2 and possession of the fuel is transferred to the Secretary of Energy; and 18 (C) If the funds accumulated do not cover the projected cost, a plan to obtain As demonstrated in Attachment 2, funds accumulated additional funds to cover the cost. cover projected cost of managing irradiated fuel, with the noted exception of DEF's portion of ISFSI capital construction costs as described in the update to Irradiated Fuel Management Program pursuant to 10CFR50.54(bb) (ADAMS Accession No. ML13440A008).

Footnotes next page

Attachment 1, Page 2 of 2 Footnotes:

1 Total amount of License Termination costs (Column A) in Attachment 2.

2 Amount is net of 2018 tax obligations.

3 Represents (a) the full fund balance of DEF's qualified and non-qualified decommissioning funds, which, in accordance with the NRC exemption request approval (ADAMS Accession No. 14247A545), can also be used for Spent Fuel Management and Site Restoration costs, and (b) 100% of the funds held by the City of Tallahassee on behalf of DEF, which pursuant to NRC order (ADAMS Accession No. ML020670117) will only be used for NRC radiological decommissioning.

4 Represents values approved by the Florida Public Service Commission in Order No. PSC-14-0702-PAA-EI, issued December 22, 2014, which became effective and final pursuant to Order No. PSC-15-0067-CO-EI, issued on January 23, 2015.

5 Represents the amount actually disbursed from the fund in calendar year 2018 for License Termination costs, not the costs incurred in calendar year 2018. Disbursed amounts in 2018 include costs incurred between November 2017 and September 2018. Outstanding license termination costs of $1,229,164 for October, November and December 2018 are expected after December 31, 2018.

6 Represents the cumulative amount actually disbursed from the fund as of December 31, 2018 for License Termination costs, not the cumulative costs incurred as of December 31, 2018. Outstanding license termination costs of $1,229,164 for October, November and December 2018 are expected after December 31, 2018.

DUKE ENERGY FLORIDA, LLC DOCKET NUMBER 50 - 302 / LICENSE NUMBER DPR - 72 ATTACHMENT 2 CRYSTAL RIVER UNIT 3, ESTIMATE OF COSTS TO COMPLETE DECOMMISSIONING AND FINANCIAL ASSURANCE DEMONSTRATION

Attachment 2, Page 1 of 2 Crystal River Unit 3 Attachment 2 - Financial Assurance Demonstration December 31, 2018 Column A Column B Column C Column D Column E Column F Annual Expenses Annual expenses Annual expenses Total Expenses Projected Earnings End-of-year Fund Balances Annual Earnings on All Owners Decommissioning Trust Decommissioning Trust Fund License Termination Cost Spent Fuel Cost Site Restoration Cost Total Cost Fund at 2% Year-End Balance (in thousands) (in thousands) (in thousands) (in thousands) (in thousands) (in thousands) 2018 666,240 2019 7,951 11,849 169 19,969 13,125 659,396 2020 7,583 3,040 0 10,623 13,082 661,855 2021 7,561 3,116 0 10,677 13,130 664,308 2022 7,561 3,032 0 10,593 13,180 666,894 2023 7,561 3,032 0 10,593 13,232 669,533 2024 7,583 3,124 0 10,707 13,284 672,109 2025 7,561 3,032 0 10,593 13,336 674,852 2026 7,561 3,032 0 10,593 13,391 677,650 2027 7,561 3,116 0 10,677 13,446 680,419 2028 7,583 3,040 0 10,623 13,502 683,298 2029 7,561 3,032 0 10,593 13,560 686,265 2030 7,561 3,116 0 10,677 13,619 689,206 2031 7,561 3,032 0 10,593 13,678 692,290 2032 7,583 3,040 0 10,623 13,740 695,407 2033 7,561 3,116 0 10,677 13,801 698,531 2034 7,561 3,032 0 10,593 13,865 701,802 2035 7,561 3,032 0 10,593 13,930 705,139 2036 7,583 3,124 0 10,707 13,996 708,427 2037 7,561 8,133 0 15,695 14,012 706,744 2038 4,040 0 0 4,040 14,094 716,799 2039 4,040 84 0 4,124 14,295 726,970 2040 4,051 0 4,051 14,499 737,419 2041 4,040 0 4,040 14,708 748,087 2042 4,040 0 4,040 14,921 758,969 2043 4,040 0 4,040 15,139 770,068 2044 4,051 0 4,051 15,361 781,378 2045 4,040 0 4,040 15,587 792,926 2046 4,040 0 4,040 15,818 804,705 2047 4,040 0 4,040 16,054 816,719 2048 4,051 0 4,051 16,294 828,962 2049 4,040 0 4,040 16,539 841,461 2050 4,040 0 4,040 16,789 854,210 2051 4,040 0 4,040 17,044 867,215 2052 4,051 0 4,051 17,304 880,468 2053 4,040 0 4,040 17,569 893,997 2054 4,040 0 4,040 17,840 907,797 2055 4,040 0 4,040 18,116 921,873 2056 4,051 0 4,051 18,397 936,219 2057 4,040 0 4,040 18,684 950,864 2058 4,040 0 4,040 18,977 965,801 2059 4,040 0 4,040 19,276 981,037 2060 4,051 0 4,051 19,580 996,567 2061 4,040 0 4,040 19,891 1,012,418 2062 4,040 0 4,040 20,208 1,028,587 2063 4,040 0 4,040 20,531 1,045,078 2064 4,051 0 4,051 20,861 1,061,889 2065 4,040 0 4,040 21,197 1,079,046 2066 4,040 0 4,040 21,541 1,096,547 2067 26,489 438 26,927 21,662 1,091,282 2068 66,679 1,402 68,082 21,145 1,044,346 2069 130,730 1,640 132,370 19,563 931,539 2070 108,969 1,240 110,209 17,529 838,859 2071 88,705 868 89,573 15,881 765,168 2072 58,206 337 58,543 14,718 721,343 2073 5,424 26,921 32,345 14,103 703,101 2074 99 19,913 20,012 13,862 696,951 1

Total $746,690 $72,155 $52,928 $871,773 Footnotes next page

Attachment 2, Page 2 of 2 Footnotes:

Column A - Annual Expenses - License Termination Cost - Reflects the License Termination cost portion of the Decommissioning Cost Estimate (DCE) escalated to 2018 dollars at the Consumer Price Index escalation rate of 2.5% for 2018.

Column B - Annual Expenses - Spent Fuel Management Cost - Reflects the Spent Fuel Management cost portion of the Decommissioning Cost Estimate (DCE) escalated to 2018 dollars at the Consumer Price Index escalation rate of 2.5% for 2018.

Column C - Annual Expenses - Site Restoration Cost - Reflects the Site Restoration cost portion of the Decommissioning Cost Estimate (DCE) escalated to 2018 dollars at the Consumer Price Index escalation rate of 2.5% for 2018.

Column D - Annual Expenses - Total Cost - Reflects the sum of the License Termination, Spent Fuel Management and Site Restoration costs.

Column E - Projected Earnings - Reflects earnings on funds remaining in the trusts. Pursuant to 10 CFR 50.82(a)(8)(vi), a 2% real rate of return is used in this financial analysis. The earnings are calculated on the previous year's end-of-year fund balance (Column F) less 50% of the given year's annual expenses.

Column F - End-of-year Fund Balances - Reflects the end-of year fund balance of all funds after all projected earnings are added and projected expenditures are deducted.

The 2018 end-of-year fund balance includes 100% of $7,128,459 in funds held by the City of Tallahassee on behalf of Duke Energy Florida, which pursuant to NRC order (ADAMS Accession No. ML020670117) will only be used for NRC radiological decommissioning.

For the purposes of demonstrating financial assurance in accordance with 10 CFR 50.82(a)(8)(vi), the methodology and assumptions in this analysis are consistent with the March 28, 2014, Request for Exemption from 10 CFR 50.82(a)(8)(i)(A) and 10 CFR 50.75(h)(2) (ADAMS Accession No. ML14098A037), which was approved by NRC on January 26, 2015 (ADAMS Accession No. ML14247A545).

1 Total may not add due to rounding.