ML19246C526
| ML19246C526 | |
| Person / Time | |
|---|---|
| Site: | Crane  |
| Issue date: | 06/15/1979 |
| From: | Gossick L NRC OFFICE OF THE EXECUTIVE DIRECTOR FOR OPERATIONS (EDO) |
| To: | Proxmire W SENATE |
| References | |
| NUDOCS 7907260154 | |
| Download: ML19246C526 (3) | |
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The Honorable William Proxmtre
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United States Senate Wa_shington, DC 20510
Dear Senator Proxmire:
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With regard to the letter of May 9,1979 from Mrs doan Estes requesting infomation on the Price-Anderson Act, we are pleased to provide you with the.following infomation. -Under the Price-Anderson Act (Public Law 85-256, as amended, 42 USC 2210) there is a system of. private funds and government indemnity totalling up to $560 million to pay public liability claims.for personal injury and property damage ~ resulting from a nuclear incident. The Act, which was passed.in 1957 and extended in 1965 for ten years until 1977 and again in 1975 for an additional. ten year period until July 31, 1987 requires licensees of commercial nuclear power plants having a rated capacity of 100,000 electrical kilcwatts or more-to provide proof to the fiRC that they.have financial protection in the fom of private nuclear liability insurance, or in some other form approved by the Comission, in an amount equal to the maximum amount of liability insurance available at reasonable cost' and on reasonable tems from private sources. That financial protection, presently $495 million is comprised of primary private nuclear liability insurance of $160 million available from two nuclear liability insurance pools, American fluclear Insurers (AilI) and Mutual Atomic Energy Liability Underwriters (MAELU) and a secondary retrospective premium insurance layer.
In the event of a nuclear incident causing damages exceeding $160 million, each comercial nuclear power plant licensee would be assessed a' prorated share of damages in excess of the primary insurance layer up to $5 '
million per reactor per incident but not in excess of.$10 million for each reactor.in any year. With 67 comercial reactors operating under this system, the secondary insurance layer totals $335 million.
Th'e difference of $65 million between the financial protection layers a
$495 million and the $560 million liability limit is the present government -
indemnity level. Government indemnity will gradually be phased out as more comercial reactors are licensed and licensees participate in the retrospective premium system.. At the time the primary and secondary financial protection layers by themsel.ves provide liability coverage of b
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i The Honorable Willian proxmire '
, $560 million, government indennity will be eliminated.
After that point, the liability limit would increase in increments of $5 nillion for each new comercial reactor licensed without any cap on the linit.
Coccorcial nuclear power reactor operators may purchase property insurance from the two insurance pools, MI and 1%ELU for up to $300 nillion per site. This insurance.provides coverage for damage to the reactor itself and other on-site property. The Three !!ile Island reactor operators have such a $300 million property insurance policy. This policy, which is the sane policy maintained lay other reactor operators, decs not provide coverage for the cost of replacenent power that the operators are purchasing while.the Three f tfic Island reactors are not operating.
Coverage for replacement pcwer costs is not available from the insurance pools. k'e do not know what the cost for such coverage would be if it were possible to obtain it from other sources.
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If we r.ay be of further assistance, please do not hesitate to contact us.
_ Sincerely,
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Lee V. Gouicf Distribution:
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Executive Direcset OCA (3) SECY 79-1529 h op.7g;.
HShapar, OELD JCook - 06365 HRDenton EGCase MGroff - 06365 PSB GErtter - 06365 RBoyd RDeYoung VStello RMattson PDR LPDR NSIC AIG Reading AIG Files
- JSaltzman IDinitz NRR Reading See attached yellow for concurrence:
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