ML19336A028
| ML19336A028 | |
| Person / Time | |
|---|---|
| Site: | Beaver Valley |
| Issue date: | 12/18/2019 |
| From: | Jennifer Tobin Plant Licensing Branch 1 |
| To: | Penfield R FirstEnergy Nuclear Operating Co |
| Tobin J | |
| References | |
| EPID L-2019-LLL-0028 | |
| Download: ML19336A028 (7) | |
Text
December 18, 2019 Mr. Rod L. Penfield Site Vice President FirstEnergy Nuclear Operating Company Beaver Valley Power Station Mail Stop P-BV-SSB P.O. Box 4, Route 168 Shippingport, PA 15077
SUBJECT:
BEAVER VALLEY POWER STATION, UNITS 1 AND 2 - SAFETY EVALUATION RE: IRRADIATED FUEL MANAGEMENT PLANS (EPID L-2019-LLL-0028)
Dear Mr. Penfield:
The U.S. Nuclear Regulatory Commission (NRC) staff has completed review of FirstEnergy Nuclear Operating Companys (FENOC or the licensee) letter dated March 15, 2019 (Agencywide Documents Access and Management System (ADAMS) Accession No. ML19074A244). In accordance with Title 10 of the Code of Federal Regulations (10 CFR)
Section 50.54(bb), the licensee provided the irradiated fuel management plans (IFMPs) for Beaver Valley Power Station, Units 1 and 2 (Beaver Valley).
FENOCs letter dated March 15, 2019, included IFMPs for Beaver Valley, as well as Davis Besse Nuclear Power Station, Unit 1 (Davis Besse), and Perry Nuclear Power Plant, Unit 1 (Perry). By letter dated August 22, 2019 (ADAMS Accession No. ML19234A158), FENOC withdrew the IFMPs for Davis Besse and Perry. As FENOC noted, IFMPs for Davis Besse and Perry are no longer required because those two plants will no longer permanently cease operations, as originally stated in the letter dated March 15, 2019. The letter dated August 22, 2019, also provided revised versions of the Beaver Valley IFMPs.
The enclosed safety evaluation documents the NRC staffs review of the updated IFMPs for Beaver Valley.
If you have any questions, please contact me at 301-415-2328 or Jennifer.Tobin@nrc.gov.
Sincerely,
/RA/
Jennifer C. Tobin, Project Manager Plant Licensing Branch 1 Division of Operating Reactor Licensing Office of Nuclear Reactor Regulation Docket Nos. 50-334 and 50-410
Enclosure:
Safety Evaluation cc: Listserv
- by e-mail OFFICE NRR/DORL/LPL1/PM*
NRR/DORL/LPL1/LA NMSS/REFS/FAB/BC(A)*
NAME JTobin LRonewicz FMiller DATE 12/09/2019 12/09/2019 11/26/2019 OFFICE NRR/DORL/LPL1/BC NRR/DORL/LPL1/PM NAME JDanna JTobin DATE 12/18/2019 12/18/2019
Enclosure SAFETY EVALUATION BY THE OFFICE OF NUCLEAR MATERIAL SAFETY AND SAFEGUARDS IRRADIATED FUEL MANAGEMENT PLANS FIRSTENERGY NUCLEAR OPERATING COMPANY BEAVER VALLEY POWER STATION, UNITS 1 AND 2 DOCKET NOS. 50-334 AND 50-410
1.0 INTRODUCTION
By letter dated April 25, 2018 (Agencywide Documents Access and Management System (ADAMS) Accession No. ML18115A007), FirstEnergy Nuclear Operating Company (FENOC),
acting as agent for FirstEnergy Nuclear Generation, LLC (FENGen), notified the U.S. Nuclear Regulatory Commission (NRC) of the intention of FirstEnergy Solutions Corp. (parent of FENGen) to permanently cease operations of the four FENGen reactors over the next 3 years.
As a result, by letter dated March 15, 2019 (ADAMS Accession No. ML19074A244), FENOC submitted the irradiated fuel management plans (lFMPs) for the aforementioned FENGen facilities to the NRC for review and preliminary approval, as required by Title 10 of the Code of Federal Regulations (10 CFR) Section 50.54(bb).
By letter dated July 26, 2019 (ADAMS Accession No. ML19207A097), the Certification of Permanent Cessation of Power Operations for the Ohio-located FENGen facilities (Davis Besse Nuclear Power Station, Unit 1 (Davis Besse), and Perry Nuclear Power Plant, Unit 1 (Perry)),
were withdrawn. As a result, FENGen is not required at this time to submit IFMPs for Davis Besse and Perry. Because FENGen still plans to permanently cease operations at Beaver Valley, Units 1 and 2 (Beaver Valley), in 2021, NRC staff review and preliminary approval of the IFMPs for those reactors is still required within 2 years following their permanent cessation of operations.
By letter dated August 22, 2019 (ADAMS Accession No. ML19234A158), FENOC submitted revisions to the (site-specific) Beaver Valley IFMPs that supersede the IFMPs contained in the letter dated March 15, 2019. The letter dated August 22, 2019, describes the revisions to the IFMPs as eliminating the funding associated with Davis Besse and Perry, updates to reflect minor changes in the number of fuel assemblies to be disposed assumed in the site-specific decommissioning cost estimates, and other minor changes.
2.0 BACKGROUND
Beaver Valley is located approximately 17 miles west of McCandless, Pennsylvania, in Shippingport, Pennsylvania. The reactor site is comprised of two reactors (Units 1 and 2), and each reactor is authorized to operate at a maximum thermal power level of about 2,900 megawatts thermal. Unit 1 received its operating license on July 2, 1976. Unit 2 received its operating license on August 14, 1987. Both are pressurized water reactors. Beaver Valley also includes a general licensed independent spent fuel storage installation (ISFSI).
In its letter dated April 25, 2018, FENOC notified the NRC of its intent to prematurely and permanently cease power operations at Beaver Valley, Unit 1, no later than May 31, 2021, and Beaver Valley, Unit 2, no later than October 31, 2021.
3.0 REGULATORY EVALUATION
3.1 Regulatory Requirement (10 CFR 50.54(bb))
The regulation under 10 CFR 50.54(bb) states, in relevant part:
For nuclear power reactors licensed by the NRC, the licensee shall, within 2 years following permanent cessation of operation of the reactor or 5 years before expiration of the reactor operating license, whichever occurs first, submit written notification to the Commission for its review and preliminary approval of the program by which the licensee intends to manage and provide funding for the management of all irradiated fuel at the reactor following permanent cessation of operation of the reactor until title to the irradiated fuel and possession of the fuel is transferred to the Secretary of Energy for its ultimate disposal in a repository.
3.2 Criteria and Information Evaluated to Support the 10 CFR 50.54(bb) Review Similar to reviews of other IFMPs,1 the NRC staff reviewed the following information submitted in support of the FENOC IFMPs to evaluate and provide preliminary approval of the spent fuel management (SFM) and funding program:
Estimated cost to isolate the spent fuel pool and fuel handling systems - for the decontamination (DECON) option, the cost to isolate the spent fuel pool and fuel handling systems may be considered part of the preparation for DECON.
Estimated cost to construct an ISFSI or a combination of wet/dry storage.
Estimated annual cost for the operation of the selected option (wet or dry storage or a combination of the two) until the U.S. Department of Energy (DOE) takes possession of the fuel.
1 Recent reviews include the safety evaluations by the Office of Nuclear Reactor Regulation related to the IFMP of Exelon Generation Company, Oyster Creek Nuclear Generating Station, Docket No. 50-219 (ADAMS Accession No. ML18241A068); IFMP of Omaha Public Power District, Fort Calhoun Station, Unit 1, Docket No. 50-285 (ADAMS Accession No. ML18017B005); IFMPs of Southern California Edison Company, San Onofre Nuclear Generating Station, Units 2 and 3, Docket Nos. 50-361 and 50-362 (ADAMS Accession No. ML15182A256); and the updated IFMP of Duke Energy Florida, Inc., Crystal River Unit 3 Nuclear Generating Plant, Docket No. 50-302 (ADAMS Accession No. ML14344A408).
Estimated cost for the preparation, packaging, and shipping of the fuel to DOE.
Estimated cost to decommission the spent fuel storage facility.
Brief discussion of the selected storage method or methods and the estimated time for these activities.
Information identifying the source of funds for managing spent fuel.
4.0 TECHNICAL EVALUATION
4.1 Evaluation of the SFM Plan Estimated Costs The NRC staffs review of the licensees submittal included the SFM activities and associated cost elements found in Beaver Valleys updated IFMPs. The IFMPs and associated costs estimated by the licensee total $238.34 million (2018 dollars). The NRC staff reviewed estimates for major SFM activities and funding requirements, including capital for SFM infrastructure; SFP operation, maintenance, and isolation costs; ISFSI expansion and operating costs; emergency planning costs; security and utility staffing costs; and spent fuel transfer costs.
All the fuel on the ISFSI is stored in Transnuclear NUHOMS Dry Shielded Canisters as provided in the IFMP submittal.
Regarding spent fuel removal from the site, FENOC indicated that fuel is expected to be removed beginning in 2029. This plan remains dependent upon DOEs ability to remove spent fuel from the site in a timely manner. According to the revised IFMPs, assuming that DOEs generator allocation/receipt schedules are based upon the oldest fuel receiving the highest priority and that DOE begins removing spent fuel from commercial facilities in 2025 with an annual capacity of 3,000 metric tons of uranium, spent fuel is projected to remain at the site for approximately 39 years after the termination of operations in 2021. Any delay in transfer of fuel to DOE or decrease in the rate of acceptance will correspondingly prolong the transfer process and result in spent fuel remaining at the site longer than anticipated. Accordingly, in the revised IFMPs, FENOC based its cost assumptions on fuel removal from Beavery Valley from 2029 through 2060. The NRC staff finds that these assumptions regarding the final disposition of Beaver Valley spent fuel are reasonable because DOE, according to the Nuclear Waste Policy Act of 1982, is authorized to ultimately enter into contracts with owners and generators of commercial spent nuclear fuel to begin taking title to (legal ownership of) spent nuclear fuel.
Spent fuel storage operations will continue at the site, independent of decommissioning operations, until the transfer of the fuel to DOE is complete.
Regarding the cost estimate for the IFMPs and related activities at Beaver Valley, the NRC staff evaluated the $238.34 million and $243.94 (2018 dollars) estimated costs for Beaver Valley, Units 1 and 2, respectively, for reasonableness. In doing so, the NRC staff considered cost information from independent sources and compared that data against information provided by other licensees. One such study, Blue Ribbon Commission on Americas Nuclear Future (the Blue Ribbon Commission report), published in January 2012 for DOE, provides cost and cost considerations for the operation and maintenance of spent fuel storage at shutdown sites.
Costs cited in that report range from $4.5 million to $8 million per year (2012 dollars) for SFM at shutdown sites. 2 These costs adjusted for inflation (2018 dollars) are $5.02 million and
$9.22 million, respectively. Accounting for inflation, and considering the IFMP operational 2 See page 35 of the Blue Ribbon Commission report.
period, the NRC staff determined that the cost estimates provided by FENOC, on average (approximately $5.8 million and $5.95 million, for Beaver Valley, Units 1 and 2, respectively), fall within the range of costs cited in the study. In addition, the NRC staff determined that the FENOC cost estimates were comparable to a range of other licensees IFMP cost estimates previously reviewed by the NRC staff. The NRC staff acknowledges that potential site-specific variances may exist among individual IFMPs. Based on the foregoing, the NRC staff finds the
$238.4 million cost estimate for SFM to be reasonable.
4.2 Evaluation of the Program to Manage and Provide Funding of All Spent Fuel On March 31, 2018, FirstEnergy Solutions Corp. (FES), together with FENOC, FENGen, and FESs other subsidiaries, filed voluntary petitions for bankruptcy protection under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Northern District of Ohio, Eastern Division (Bankruptcy Court). By letter dated April 2, 2018, in accordance with 10 CFR 50.54(cc)(1), FENOC notified the NRC of the bankruptcy filing.3 Under the Bankruptcy Reorganization Plan, as submitted to and confirmed by the Bankruptcy Court, at emergence from bankruptcy, a new privately held holding company will be formed with shares initially held by certain current creditors of one or more of FES, FENOC, FENGen, or FirstEnergy Generation, LLC (a sister company of FENGen holding fossil fuel generation assets), and management of the new holding company. The new holding company is described in the application using the generic name, New HoldCo. Both reorganized FENOC and reorganized FENGen will become wholly-owned subsidiaries of New HoldCo. New HoldCo will also have ultimate ownership of FESs existing non-nuclear generating assets as well as the retail and wholesale load-serving business. Similarly, as part of the reorganization and emergence from bankruptcy, the names of the licensees will change after the license transfer transaction is consummated. These new names are described in the application using the generic names OpCo for reorganized FENOC and OwnerCo for reorganized FENGen.
FENOC notes that upon emergence from bankruptcy, New HoldCo and its subsidiaries are projected to have approximately $2 billion in current assets, including cash and cash equivalents. FENOC anticipates that such assets would be able to fund Periods 1 and 2a SFM activities for Beaver Valley by placement of $267 million into a provisional trust by the end of 2021. The provisional trust will enable use of the funds for SFM activities occurring during Periods 1 and 2a. Upon the completion of the SFM activities in Periods 1 and 2a, the terms of the provisional trust will provide that it can be terminated, and its balance released back to OwnerCo. As assurance regarding its reliance on the provisional trust, FENOC agreed to the following license condition for Beaver Valley, reflecting its commitment:
OwnerCo shall create a provisional trust in the amount of $267 million for spent fuel management activities for Beaver Valley Power Station, Unit Nos. 1 and 2.
The trust shall be fully funded by December 31, 2021. Upon completion of the specified spent fuel management activities in the Irradiated Fuel Management Plan, dated August 22, 2019, the provisional trust may be terminated. The provisional trust may also be modified or terminated upon NRC approval of a revised Irradiated Fuel Management Plan that supersedes the plan dated August 22, 2019.
3 ADAMS Accession No. ML18094A661.
As noted in the letter dated August 22, 2019, the funding for SFM activities will be provided by a combination of a provisional trust in the amount of $267 million from 2021 through 2026 (Periods 1 and 2a) and payments from DOE due to its partial breach of the Standard Contract for Disposal of Spent Nuclear Fuel and/or High-Level Radioactive Waste (Standard Contract) from 2026 through 2060 (Period 2b).
FENOC expects to recover the majority of the costs for Periods 1 and 2a by making claims for damages resulting from DOEs partial breach of the Standard Contract. FENOC also expects that by no later than January 1, 2027, it will be able to obtain a settlement agreement to recover Period 2b costs annually.
FENOC also committed to having a performance bond in place to cover annual SFM costs in the event that a settlement with DOE is not reached. The bond will be renewed annually until a settlement is reached. As assurance regarding its reliance on a future DOE settlement agreement, FENOC agreed to the following license condition for Beaver Valley, reflecting its commitment:
OwnerCo shall obtain performance bonds if a settlement agreement with the U.S.
Department of Energy (DOE) on DOE reimbursements for spent fuel management expenses is not entered into by January 1, 2027. The performance bonds will be effective December 31, 2026, initially in the amount of $9.3 million and $4.7 million for BVPS, Units 1 and 2, respectively, and they will be renewed annually. This amount covers 1.3 times the highest annual amount of ISFSI operation and maintenance (O&M) costs projected.
The NRC staff finds that the assumption of DOE reimbursement is a reasonable source of additional funding. In recent years, DOE reimbursements have become more consistent and predictable, despite the longevity of the litigation process and complexity of DOE standard settlement agreements. Moreover, FENGen has successfully recovered more that $193 million from DOE. Finally, as further assurance of its reliance on a future DOE settlement agreement, FENOC agreed to a license condition to obtain a performance bond to cover SFM costs if a settlement agreement is not reached in the timeframe anticipated. Therefore, the NRC staff concludes that DOE reimbursements, as proposed by FENOC, provide a reasonable source of funds to cover costs associated with the SFM for this financial qualifications review.
5.0 CONCLUSION
Based on the NRC staffs review of estimates for major SFM activities and funding requirements, the staff finds that the activities and associated costs of the Beaver Valley IFMPs appear reasonable.
Based on its review in consideration of the above analysis, conditions related to the transfer of the FENOC reactor fleet licenses, including Beaver Valley, and the Bankruptcy Courts confirmation of the Bankruptcy Reorganization Plan on October 16, 2019, the NRC staff finds that FENOC has demonstrated reasonable assurance of obtaining the funds necessary to cover estimated costs for SFM in accordance with the requirements of 10 CFR 50.33(f) and 10 CFR 50.54(bb).
Principal Contributor: S. Harwell Date: