ML20054L511
| ML20054L511 | |
| Person / Time | |
|---|---|
| Site: | La Crosse File:Dairyland Power Cooperative icon.png |
| Issue date: | 06/29/1982 |
| From: | Linder F DAIRYLAND POWER COOPERATIVE |
| To: | Harold Denton Office of Nuclear Reactor Regulation |
| References | |
| LAC-8364, NUDOCS 8207080195 | |
| Download: ML20054L511 (3) | |
Text
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D DA/RYLAND
_COOPERAT/VE po sox 817 2615 EAST AV SOUTH LA CROSSE. WISCONSIN 54601 I
(608) 788-4000 FRANK LINDER 1
dune 29, 1982 General Manager In reply, please refer to LAC-8364 DOCKET NO. 50-409 Dr. Harold Denton, Director Nuclear Reactor Regulation U. S. Nuclear Regulatory Commission Washington, D. C.
20555 j
SUBJECT:
DAIRYLAND POWER COOPERATIVE LA CROSSE BOILING WATER REACTOR (LACBWR)
PROVISIONAL OPERATING LICENSE NO. DPR-45 PROPERTY INSURANCE RE0VIREMENTS
REFERENCE:
10 CFR 50.54 (w) 10 CFR 50.12 (a) i Gentlemen:
Pursuant to 10 CFR 5 50.12(a) DPC requests an exemption from the require-ment in 5 50.54(w) that it obtain on-site property damage insurance for the LACBWR facility in an amount equal to the maximum coverage offered by either ANI/MAERP, jointly, or NML; plus that offered either by NEIL/EEI/ANI/MAERP, jointly, or NML as excess insurance.
The bases for this request are:
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The reasons stated (47 FR 13753) for adoption of 5 50.54(w) are that it "will substantially reduce the effort and resources associated with demon-strating financial qualifications," " relieve significantly the obligations of certain applicants with respect to information," and " reduce the amount of l
unnecessary, time-consuming staff review." DPC's financial qualifications with respect to LACBWR were submitted with its application for conversion of its existing provi:ional operating license to a full term operating license in 1972 and 1974.
See DPC letter, dated May 22, 1972, to Mr. Edward J. Block, and DPC letter, dated dctober 9,1974, to Mr. A. Giambusso.
In the absence of any questions, requests for additional information, or issues regarding such l
qualifications during the intervening eight years, we assume those qualifica-l tions have been reviewed and found to be adequate. Thus, in the case of LACBWR, the new requirement to provide on-site property damage insurance in lieu of demonstrating financial qualification will not result in any of the benefits justifying the new requirement. To the contrary, it would unreasonably and l-unnecessarily add significantly to DPC insurance premium costs with respect to LACBWR, pno l o
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i 8207000195 820629 DR ADOCK 05000
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a U. S. Nuclear Regulatory Commission Page 2 June 29, 1982 2.
DPC has recently increased its all risk property insurance on LACBWR to the amount of $55 million (less $100,000 deductible).
3.
In our opinion, the existing insurance is adequate to fully decon-taminate and clean up LACBWR in the event of a major accident.
a.
The cost for decommissioning LACBWR has been estimated at between $5 million and $39 million. The higher estimate would provide immediate complete dismantling and removal from the site of all irradiated components and spent fuel. Although additional expense could be involved in certain situations (i.e., containment building flooded, substantial core damage), such expense would be within DPC's financial capability and available insurance.
b.
In the event of a major accident at LACBWR, it is unlikely that efforts would be made to restore LACBWR to operating condition in view of its size and expected remaining useful life. Thus, there would be no additional expenses to replace damaged equipment.
4.
Since LACBWR is a 50 MW rated facility, the amount of on-site property damage insurance for LACBWR should be commensurate with its size in comparison with other larger and newer plants. Under 5 50.54(w) a 1000 MW plant is required to have property damage insurance equal to approximately one-fourth of its value, while DPC is required to have insurance equal to almost ten times the value of LACBNR. The amount of insurance required for a 500 MW plant is only about one-half its value. As stated in 47 FR 13753, NRC only intends to require "a rea-sonable amount of insurance for decontaniination expense." However, the commen-tary illogically assumes a major accident at LACBWR could " require (property damage) coverage approaching $1 billion, no matter what the original value or size of the facility."
Under most circumstances the damage resulting from the worst possible accident at LACBWR would be a small fraction of a similar accident at most larger and newer PWR plants.
LACBWR has a low probability of failure by virtue of redundant safety requirements which are designed to prevent core damage in the event of a loss of coolant accident.
It also has a tight containment building and contains less coolant in the primary circuit than most larger and newer PWR units. Due to its small size, the reactor contains a low inventory of fissionable material and fission products and yields a much smaller and more confined contamination area to be dealt with in the event of the worst postulated accident. Moreover, since power outout is directly related to the amount of possible damage, it is not reasonable to project that the amount of damage for a 50 MW pl, ant would be the same as a much larger plant. As noted in the Sandia Report M LACBWR has never "had an accident or incident determined to be detrimental to the health and safety of the public.
Although the focu: of that Report was on costs of complying with increased licensing requirements to improve safety, its bases are also relevant to the unnecessary burden imposed by 5 50.54(w).
~1/ Attachment to Crutchfield memo to Eisenhut " Licensing Actions And Technical Review Efforts For Smaller And Older Licensed Power Reactors."
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i U. S. Nuclear Regulatory Commission Page 3 June 29, 1982 S.
As of the end of DPC's 1981 fiscal year, DPC had an equity of $67,807,342 on a total capitalization of $408,983,750.
In addition, DPC operating costs, including decontamination and clean up of LACBWR (if required), are guaranteed by contracts with its twenty-nine distribution cooperative members-owners that require payment of revenues to DPC adequate to meet all of DPC's financial respon-l sibilities until the year 2015.
l 6.
LACBWR represents less than five percent of DPC's total installed gen-4 erating capacity.
t 7.
DPC has been advised that the total amount of on-site property damage 4
insurance for LACBWR available from the sources identified in 5 50.54(w) is
$527,000,000, at an annual premium of $695,000. Compliance with 5 50.54(w),
therefore, would increase DPC's annual insurance premiums for LACBWR by approxi-mately 330%, or $484,150.
It is unreasonable to require this added expense in-i asmuch as 1) DPC's existing insurance is adequate to cover reasonable decontami-nation and clean up costs, 2) DPC has sufficient financial capability, apart from such insurance, to cover such costs, and 3) the insurance amount is nearly ten times the value of the LACBWR plant.
8.
Granting this exemption would not affect other licensees since LACBWR is the only licensed 50 MW plant now operating.
l 9.
Granting this exemption will not adversely affect public health and safety since DPC has adequate insurance and financial capability to decommission 3
and clean up LACBWR in the unlikely event of a major accident.
Sincerely, WC 1
Frank Linder, General Manager i
FL:daj i
i STATE OF WISCONSIN )
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COUNTY OF LA CROSSE) 1 Personally came before me this M day of June,1982, the above named i
Frank Linder, to me known to be the person who executed the foregoing l
instrument and acknowledged the same.
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l Notary Public, La Crosse County, Wisconsin.
My Commission Expires 2/26/84.
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