ML20055H406

Forwards Regulatory History Documents Re Final Rule 10CFR50 Concerning Stabilization & Decontamination Priority & Trusteeship Provisions,Per M Lesar 900706 Request

ML20055H406
Person / Time
Issue date:	07/23/1990
From:	Wood R Office of Nuclear Reactor Regulation
To:	NRC
Shared Package
ML19330E582	List: ML20055C466 ML20055H406 ML20055H433
References
FRN-54FR46624, RULE-PR-50 AD19-2-01, AD19-2-1, NUDOCS 9007260164
Download: ML20055H406 (1)

Text

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o UNITED STATES -

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',9, NUCLEAR REGULATORY COMMISSION 13~

2 WASHINGTON, D. C. 20555 l a,

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July 23, 1990

.t MEMORANDUM FOR: ' ClHWOCSF FROM:-

Robert S. Wood, Senior Financial Policy Analyst Policy Development and Financial Evaluation Section Policy Development and Technical Support Branch Program Management Policy Development and Analysis Staff

-Office of Nuclear-Reactor Regulation

SUBJECT:

REGULATORY HISTORY INDEX FOR THE FINAL RULE ON STABILIZATION AND DECONTAMINATION PRIORITY AND TRUSTEESHIP PROVISIONS As requested in Michael Lesar's memoran'dum to me dated July 6,1990, the enclosed documents relevant to the subject rulemaking should be added to'the=

1 regulatory history index of the rule. The documents are designated as j

' directed in Mr. Lesar's memorandum.

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Robert S.' Wood,_ Senior Financial Policy Analyst Policy Development and Financial Evaluation Section 4

Policy Development and Technical Support Branch _

l Program Management, Policy Development and Analysis Staff Office of Nuclear Reactor Regulation

Enclosure:

As stated 4

1 9007260164 900723 PDR PR 50 54FR46624 PDR s

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RULEMAKING ISSUE

-February 22, 199_0 (NEGATIVE CONSENT)

SECY-90-059 1

l For:-

The Connissioners From:

James it. Taylor Executive Director for Operations

Subject:

FINAL RULE, 10 CFR PART 50 -- STABILIZATION AND

.DECONTAftlNAll0N PRIORITY AND TRUSTEESHIP PROVISIONS

Purpose:

To inform the Cour,ission that the EDO intends to publish a final rule amending the property / accident recovery insurance require-mentscontainedin10CFR50.54(w).

Sunnary:

The rule will (1) clarify the scope and timing of the stabili-zetion and decontamination processes after an accident at a covered reactor; (2) specify that the insurance is required to ensure that commercial power reactor licensees will have suf-ficient-funds to carry out their oblig(ation to clean up and3) eliminate the requir decontaminate after an accident; and ment that insurance proceeds after an accident are paid to an' independent trustee. This rule responds to issues caised in three petitions for rulemaking.

Category:

This is a negative censent item. The action clearly-falls within established Connission policy as set forth in 10 CFR 1.31(a)(3) which delegates certain rulemaking authority to the Executive Director'for Operations.

Discussion:

On November 6,1989, the Ccr.wission published in the Federal

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Register (54 FR 46624) a proposed rule to amend 10 CFR 50 44(w).

The rule was developed in response to three petitions for rulemaking. ' Notice of receipt of these petitions was published in the Federal Register on September 19, 1988 (53 FR 36335).

These pet.itions sought (1) clarification of the scope and timing-of the stabilization process after an accident at a covered

, reactor; (2) clarification of the procedures by which the NRC CONTACT:

NOTE:

TO BE MADE PUBLICLY R.'Wced, NRR AVAILABLE WHEN THE M--h_

FINAL SRM IS MADE 492-1280 Qf, _ g t['g' AVAILABLE 4

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i iThe Commissioners d determines and approves expenditures of funds necessary for l

decontamination and cleanup, and clarification of how such pro-cedures affect both insurer's needs to' secure appropriste proofs j

, of loss and when >ayments may be made for non-cleanup purposes; (3) a' change in tle terminology of the required insurance from 1

" property" insurance-to " decontamination liability" insurance l

so as to better forestall claims to insurance proceeds by a

'licensee's bondholders; and (4) rescission of the provision-that proceeds of the required insurance are to be peid to an independent trustee, who will disburse the proceeds for i

decontamination and cleanup of the facility before any other purpose.

As of January 18, 1990, the NRC receivnd seven comments on the c

proposed rule.

Six comments came-from electric utilities or their representatives. One comment came from the Association of the Bar of the City of New York. 'All connenters essentially supported the Commission's rulemaking, although some took issue c

with' specific provisions. The staff considers these issues to-be minor. They are discussed in the enclosed Federal Register notice..The staff believes that no changes to the proposed rule

- are warranted.

The only issue of substance concerns whether and to what extent t

the. amount.of required accident recovery insurance should i

increase. As explained in the enclosed Federal Register notice, the staff believes that the-public shou w te offered the opportunity to comment on a formula and a methodology to incretse the amount of insurance that was developed by Pacific.

1 Northwest Laboratory (PNL).

The staff believes it is appropriate to consider'this issue separetely for the 'following reasons. This final rule needs to be published by April 4, 1990 or the trusteeship and the decon-r l

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tamination priority provisions will become effective automatically.

Because these provisions are unimplementable, delay of this rule u

would either lead to mass non-compliance by all power reactor

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L licensees or would require resource-intensive issuance of E

exemptions to all power reactor ~ licensees.

Decause most licensees carry more than the minimum insurance required and because the bulk of accident cleanup costs would be covered by' the existing required amount, there is-no compellirg public 4

hthith and safety reason to change the amount before affording

'the opportunity for public comment on'the PNL report. The staff 1

n thus proposes to develop a rule when the PNL. report is formally published and comments have been received. We estimate that this process vill take 9 months to 1 year.

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8 The Commissioners- -

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' Recommendation: That the Comission note:

1. The EDO. plans to sign the final rule revising 10 CFR 50.54(w)

I assetforthinthedraftFederalRegisternotice(Enclosure

1) and the statement approving the final rule for publication, J

as set forth in Enclosure 2, in 10 working days from the date of this paper unless otherwise instructed by the Commission.

2. In 10 working days from the date of this paper, unless' directed otherwise by the Commission, the EDO will certify.

that this final rule will not have a significant-economic effect on a substantial number of.small entities pursuant' to the-Regulatory Flexibility Act of 1980,-5 U.'S.C. 5605(b).

3. Considering that the text of.the final rule is identical to the text of the rule as proposed,_the staff has reviewed the environmental :.ssessment and finding of no.

-significant environmental impact published'with the p(54 FR 46624, at 46627).roposed rule-in the Federal Register on No On the basis of'that review, and after considering the:public-comments and determining.

that these comments do not affect the conclusion reached

.in the earlier finding of no significantiimpact, the staff

-has concluded that this amendment to 10 CFR 50.54(w) is not a major Federal action significantly affecting-the quality of the human environment, and therefore.an environ-rtental impact statement is not required.

This concluston is incorporated in the draft Federal Register notice.

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4. This final rule contains an amended information collection

_ requirement subject'to the Paperwork Reduction Act of 1980 (44 U.S.C. 3501 et seq.). These requirements will be referred to the Office of Management and Budget for review and approval.

5. A regulatory analysis has been prepared and is incorporated into the draft Federal Register, notice.

6. The final rule does not con-Stute a backfit under 10 CFR 50.109; therefore, a :ackfit. analysis is not i

required.

7. The appropriate Congressional committees will be informed.

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8. A public announcement will be issued.

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The Comissioners - !

9. The Office of the General Counsel has reviewed the draft Federal Register notice containing the final rule and-has

' no legal objection to it.

E J nes M. T or xecutive frector for Operations i

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Enclosure:

1.

Draft Federal Register Notice 1

-2' Statement of EDe Approving Final Rule for Publication I

SECY NOTE:

In the absence of instructions to the contrary,-SECY will notify the staff on Monday, March 12,.1990, that i

the Commission, by negative consent, assents to the action proposed in this paper.

DISTRIBUTION:

Commissioners OGC OIG-LSS GPA-

-REGIONAL OFFICES EDO ACRS

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ENCLOSURE 1

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NUCLEAR REGULATORY COMMISSION 10 CFR Part 50 RIN:

3150-AD19 Stabilization and Decontamination Priority and Trusteeship Provisions AGENCY:

Nuclear Regulatory Connission.

ACTION:

' Final rule.

SUMMARY

The' Nuclear Regulatory Commission (NRC) is amending the provisions of its property / accident recovery insurance regulations epplicable;to comercial j

power reactor Itcensees. The changes (1) clarify the scope and timing of the stabilization and decontamination processes after an accident at a covered reactor; (E) specify thet the insurance is: required to ensure that' commercial power reactor-licensees will have sufficient funds to carry out their obligation

tocleenupanddecontaminateafteranaccident;and-(3)eliminatetherequire-ment that insurance proceeds aftor an accident are paid to an independent trustee. This rule responds to',ssues raised in three petitions for rulemaking.

EFFECTIVE DATE:

[ Insert the date of publication in the Federal Register]

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L FOR FURTHER-INFORMATION CONTACT:

. Robert S. Wood, Office of Nuclear Reactor'

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Regulation, U.S. Nuclear Regulatory Commission, Washington, DC 20555,-

l Telephone'(301)492-1280.

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.. SUPPLEllEllTARY INFORI:ATION:

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Background' i

After the receipt of three petitions for rulemaking assigned Docket Nos. (PRM.

l50-51) from Linda S. Stein, Steptoe & Johnson, counsel to American Nuclear InsurersandIIAERPReinsuranceAssociation(ANI/MAERP);(PRM-50-51A)from J.B. Knotts, Jr., Bishop,-Cook, Purcell &.Reynolds, counsel to "1e. Edison Electric-Institute (EEI), the huclear Utility Management and Resources Council a

(NUltARC)andfseveralpowerplantlicensees;and(PRM-50-51B)from 1

- Peter D. Lederer, Daker & McKen:ie, counsel to Nuclear Mutual Limited and-Nuclear Electric Insurance Limited (NHL and NEIL-II), the Conmission. published a notice of receipt requesting public connent on the petitions in the Federal Register of September 19,1988.(53FR36335). The petitions were filed

-in response to a final rule on changes in property insurance requirements pub-11shed by the Corrission on August 5, 1907 (52 FR 28963). These petitions j.

sought (1) clarification of the scope and timing of the stabilization process

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- after-en accident at a covered reactor; (2) clarification of the procedures by which the NRC determines and approves expenditures of funds necessary for decon-tamination and cleanup, and clarification of how such procedures affect both insurer's needs to secure appropriate proofs of loss and when payments may be

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, J made for non-cleanup purposes; (3) a change in the terminology of-the required I

insurance from " property" insurance to " decontamination liability" insurance so as to better forestall claims on insurance proceeds by a licensee's bond-holders; and (4) rescissic.n of the provision that proceeds of the required insurance are to be paid to an independent trustee, who will disburse the pro-ceeds for decontamination and cleanup of the facility before any other pvpose.

Four coments were received on the petitions for rulemaking, all of which supported the amenc'monts recommended in the retitions. The Comission responded to the comments received on the petitions in a proposed rule published on Noverrber 6, 1989 (54 FR 46624). This final rule, in effect, grants these petitions and completes NRC action in response to PRMs 50-51,50-51A, and 50-51B.

II. Analysis of and Response to Coments On November 6,1989, the Comission published in the Federal Register (54 FR 46624) a proposed rule to amend 10 CFR 50.54(w). The rule was developed T

in response to the three petitions for rulemaking discussed above. As of January 18, 1990, the NRC received seven comments on the proposed rule. Six coments came from electric utilities or their representatives. One coment came from the Association of the Bar of the City of New York. All comenters essentially supported the Commission's rulemaking, although some took issue with specific provisions. Two aspects of the proposed rule, in particular, were opposed by several comr. enters. The first is the statement in the preamble l

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of the proposed rule that the NRC retains the authority to require an indepen-dent trustee to hold and to disburse insurance proceeds in individual cases, if warranted.

Further,.the NRC expressed its intentien that if the NRC obtains 8;

authority to receive and retain insurance proceeds itself, it will consider whether to exercise this authority and the best method of implementing the euthority (54 FR 46624, at p. 46627).

4 In support of their objections, the commenters refer to the case cited in the proposed rule -- Ir rc Smith-Douglass (Nos. 87-1683, -1684 (4th Circuit, September 6,1980)) -- and take issue with the Cortnission's cor clusion that I

the= decision in this case,iuttifies future reimposition of a trusteeship requirement. The Ccrrission continues to believe that uncertainties remain with respect to interpretttion of this ar.d similar dccisions. Consequently, if the 4

Cortniissicr. concludes that future conditions warrant reinstitution cf the trus-teeship;requirenent,_it will reopen this issue for reconsideration.

If the l

Commission does naLe such a decision, however, it will provide ample opportunity for public cotraer.t of that time..Because no provision of this final rule is i

affected by these concerns, the Commissior proposes no further discussion or-V action at this time.

The second issue raised by several cotrenters concerns how the Commission might address possible increases in accident cleanup costs resulting from inflation or other factors. Cerrmenters expressed the opinion that there is insufficient

~ experience frcrt which to dtvelop an effective formula to estira.te future

. accident cleanup costs.

Furthermore, such a formula would not be able to

i 5-account for advances in technology that might reduce future costs.

Conmenters suggest'that rather than use a formula to estimate future. cleanup costs and

- consequently-establish future insurance requirerents, the NRC reevaluate accident cleanup costs every 3 to 5 years by conducting specific studies using then-current technology. One commenter recommended using a siniple formula based on the Consumer Price Index to estimate future cleanup costs.

Since publication of the proposed rule, the NRC's contractor has updated NUREG/CR-26013 (herr,inafter cited as Addendum 1) which provided the basis for the $1,06 billion in insurcnce currently required. The report found that in 1989 do11ers, approximately $1.03 billicn would be needed for cleanup after 6 severe accident et a reference boiling water reactor, in addition, dependir5 t

on whether a 4 perce.rt or an 8 percent inflation rate is assumed, an additional

$186.5 million to $409.9 million would be needed to cover incremental cost escalation dur.ing the cleanup process.

In evaluating these costs, the con-trcctor considered labor, energy, waste disposel, and nuclear insurance as those cost componentr, with the greatest potential effect on cost esctietion.

1" Technology, Safety and Costs of Decommissioning Reference Light Water Reactors

- Following Postulated Accidents -- Addendum 1," Pacific Northwest Laboratory, to be I

f published. This repcrt will be available by approximately May 1990 for purchase frco the U.S. Covernment Printing Office, P. O. Ecx 37082, Washington, DC 20013-7082. A notice cf availability will be published.

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Except for nuclear insurance, these factors are the same as those used in the

. Comission's decommissioning rule, although the relative weights of the factors vary (53 FR 24018, June 27,1988)(See 10 CFR 50,75(c)(2)). The Connission -

notes, however, that comenters had ample opportunity to evaluate and consent upon the technical studies that the NRC used as the basis for its decomis-sioning requirements, fio such opportunity has been available heretofore for Addendum 1.

Consequently, the Comission concludes that the public interest I

would best be served if the issue of whether and to what extent the amount of accident cleanup insurance should increase is deferred pending public comment on Addendum 1.

As part of its conclusion, the Commission further notes that most licensees already carry accident cleanup insurance in amounts that exceed the maximum amount predicted by the formula in Addendum 1.

Thus, there is no ccmpelling hecith or safety reason to increase the required amount of insurance j

in advance of public comment.

Concurrently, the Connission believes that the public comments on Addenoun 1 will enable the Consission to make more inforned decisiors in connection with any future rulemaking proceeding to increase the I

amount of requireo insurance.

Individual comenters also have raised specific concerns with the proposed rule.

These concerns include the stebilization priority threshold, the 60-day pricrity L

period, and the cleanup plan. One commenter indicates that, pursuant to proposed 10 CFR.50,54(w)(4)(i), insurance proceeds would only be required to be dedicated to stabilization end decontamination if the estimated costs exceeded $100 million.

L Furthtr, this priority would it itie"y apply to stebilization costs for 60 days and could be extended in 60-day increments. Within 30 days after the reactor 1

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is-stabilized, the licensee is required to submit a cleanup plan which must

-be. approved by the Director of the Office of Nuclear Reactor Regulation. This commenter'also suggests that the rule should clarify (a) whether the NRC or the licensee _provides the cost estimate, and (b) how the Director of the Office of fluclear Reactor Regulation determines-the length of the stabilization priority' and the criteria-for approving the cleanup plan.

The NRC believes that these and similar issues have been discussed in previous

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rulemaking and that-additional sp1cificity may be cumbersone and counterproductive, I

The Cerr.11ssion cicarly intends to tely on licensees to prepare initial cost estimutes of accidents, although it i; conceivable that the Conr.ission could-prepare its own confirmatory estimates if unusual circumstances warranted.

Fu'rthermore, a cut-off figure of $100 million represents a relatively minor accident where the, availability of funds would not, as a practical n.atter, be

.at issue. Thus, it is very unlikely that the' Commission would dispute estimates unless they significently exceeded $100 million.

Further,section50.54(w)(4)(1) explicitly defines what constitutes stabilization. Therefore, it is unlikely that_ serious disegreements would arise concerning when a reactor is stabilized.

However, if disputes over-stabilization should arise, the Consnission's Rules of Practice under 10 CFR Part 2 provide adecutte procedures to resolve them.

Sirailerly, Part 2 procedures are also available to resolve disputes that may arise over the content of cleant.p plans. The Commission notes that the proposed rule was drafted in response to the suggestions of petitioners representing C

most power reactor licensees and their insurets.

The petitioners did not raise

these specific issues in their petitions or in comments on the proposed rule.

Consequently, the Commission concludes that the suggested changes to the proposed rule are not needed.

One commenter takes issue with the following statement in the Pegulatory Analysis published in connection with the proposed rule:

"Although the effect of these formulas, if-developed and adopted, would be to increase the required amount of 4

insurance for some licensees, there should be little impact on insurance costs to licensees because almost all licensees buy the maximum amount of insurance available" (54 FR 46024, at p. 46620, November 6, 1989). This commenter states that, "This may have been true ir. the past, however we do not agree with this assessment.

In fact, we did not automatically purchase the maximum amount of insurance available this year following an increase in available coverage."

Notwithstanding this commenter's decision not to buy edditional insurance, the Commission notes that the maximum amount of insurance currently offered l

exceeds by a si pificant nargin the amount that would be reauired if the maximum figure suggested in Adder.dum I were adopted. flost licensees currently purchase substantially more than this maximum. Thus, the Commission stands I

by the statement in question.

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These amendments provide relief fror, restrictions under regulations due to take effect on April 4,1990. Therefore, pursuant to 5 U.S.C. 6553(d)(1), the Commission is making the rule effective on the date of publication in the

-Federal Register without the customary 30-day waiting period.

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III.

Finding.of No Significant Environmental Impact; Availability

' Noting that the text of the final rule is identical to that of the proposed rule, the Commission hos reviewed the environmental assessment and finding of no significant environmental impact published.in the Federal Register on November 6,1989 (54 FR 46624, at 46627) in connection with the proposed rule.

On the basis of that review, and after considering the public comments _and dctermining that such comments do not affect the conclusion reached in the earlier finding of no significant impact, the Commission has concluded that this amendment to 10 CFR 50.54(w) is not a major Federal' action significantly affectir.g the quality of the human environment, and therefore, an environmental impact statement is not required.

The environmental assessment and finding of no significant impact on which this determination is based are available for inspection and copying at the NPC Public Document Room, 2120 L Street, NW, (Lower Level), l!achington, DC.

.IV.

Paperwork Reduction Act Statement This final rule amends information collection requirements that are subject to the Paperwork Reduction Act of 1980 (44 U.S.C. 3501 et seq.). The final rule has been referred to the Office of Management and Budget for review and approval.

Public reporting burclen for this collection of information is estimated to average 2,000 hours0 days <br />0 hours <br />0 weeks <br />0 months <br /> per response, including time for reviewing instructions, L

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, searching existing data sources, gathering and maintaining the data needed, and completing and' reviewing the collection of information.

Send comments regarding.his burden estimate or any other aspect of this collection of information, including suggestions for reducing this burden, to the Informatico and Records Management Branch (MNBB-7714), U.S. Nuclear Regulatory Commission, Washington, D.C. 20555; and to the Paperwork Reduction Project (3150-0011), Office of Management and Budget, Washington, D.C. 20503.

i V.

Regulatory Anclysis t

On llovember 6,1989, the Cormission published in the Federal Register (54 FR 46624) a proposed rule to amend 10 CFR 50.54(w). The rule was developed in response to three petitions for rulemaking.

Not!ce of receipt of these petitions was published in the Federal Register on September 19,:1988

-(53 fps 36335). These petitions sought clarification of the stabilization and decontamination priority provisions and rescission of the trusteeship provisions currently conteined in 10 CFR 50.54(w). The petitions furthar stated that the trusteeship provisions may actually have an effect counter to their intended purpose by deleying the payment of cleims and thus possibly the cleanup process.

The rule developed in response to the petitions for rulemaking should help j

clarify the raechanism by which accident cleanup funds may be guaranteed to be used for their intended purpose.

Even without formal stabilization and decon-tamination priority and trusteeship previsions, the NRC has authority to take L

appropriate enforcement action to order cleanup in the unlikely event of an accident.

By rescinding the trusteeship reovirement, the Commission would be l

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eliminating-licensees' costs to obtain trustee services. Thus, the rule will not create substantial costs for licensees.

1 The rule will not have significant impacts on State and local governments and geographical regions, on the environment, or create substantial costs to the NRC or other Federal agencies. The foregoing discussion constitutes the regulatory analysis for this rule.

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VI. Reguletory flexitility Certification j

As reouired by the Regulatory Flexibility Act of 1980 (5 U.S.C. 605(b)),:the Commission certifies that this final rule does not have a significant economic impact upon a substantial number of sna11 entities. The rule only affects

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licensees of nuclear power plants.

None'of the holders of these licenses fall within the scope of the definition of "small entities" set forth in the Regulatory Flexibility Act or thr. Small Business Size Standards set out in

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regulations issued by the Small Business Administration at 13 CFR Part 121.

VII. Backfit Analysis i

The NRC has determined that the backfit rule,10 CFR 50.109, does not apply to this rule because this rule will not impose a backfit as defined in $50.109(a)(1).

Therefore, a backfit analysis is not required for this rule.

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12-List of Subjects in-10 CFR Part 50 Antitrust, Classified information, Fire protection,. Incorporation by refarence, Intergovernmental relations, Nuclear power plants'and reactors, Penalty.-

Radiation protection, Reactor siting criteria, Reporting,and recordkeeping

' requirements, i

i For the reasons set out.in the preemble and under the authority of the Atomic L

- Energy _Act of 1954, es amended, the Energy' Reorganization Act of 1974, as amended, and 5'U.S.C. 552 and 553, the NRC is adopting the following amendment i

_ to 10 CFR Pert 50, PART 50 - DOMESTIC LICENSING 0F PRODUCTION AND UTILIZATION FACILITIES

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The authority citation for Part-50 continues to read as follows:

Authority: Secs. 102, 103, 104, 105, 161, 182, 183, 186, 189, 68 Stat. 936,

- 937, 938, 948, 953, 954, 955, 956, as amended, sec. 234, 83 Stat. 1224, as amended (42 U.S.C. 2132, 2133, 2134, 2135, 2201, 2232, 2233, 2236, 2239, 2282);

secs. 201 as amended, 202, 206, 88 Stat. 1242, as amended, 1244, 1246 (42 U.S.C.

~ 5841,5842,5846).

Section 50.7 also issued under Pub. L.95-601, sec. 10, 92 Stat. 2951 (42 U.S.C.

5851). Section 50.10 also issued under secs. 101, 185, 68 Stat. 936, 955, as

amended (42 U.S.C. 2131, 2235); sec.102, Pub. L.91-190, 83 Stat. 853 (42 U.S.C.

j 4332). Sections 50.13, 50.54(dd) and 50.103 also issued under sec. 108, 68 L

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-.Stt t. 939, as amended (42 U.S.C. 2138).

Sections 50.23, 50.35, 50.55, and 50.56 also. issued under sec.- 185, 68 Stat. 955 (42 U.S.C. 2235).

Sections 50.33e, 50.55a and Appendix 0 also issued under sec.100, Pub. L.91-190, 83 Stat. 853 (42 U.S.C. 4332). Sections 50.34 and 50.54 also issued un'.'s; sec. 204, 88 Stat.1245,(42U.S.C.5844).

Sections 50.58, 50.91, and 50.92 also issued under Pub. L.97-415,96 Stat.2073(42U.S.C.2239).Section50.78alsoissued under sec.122, 68 Stat. 939 s's U.S.C. 2152).

Sections 50.80 through 50.81 also issued under sec. 184, 68 Stat. 954, as amended (42 U.S.C. 2234).

Appendix F also issued under sec. 187, 68 Stat. 955 (42 U.S.C. 2237).

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t For the purposes of sec. 223, 68 Stat. 958, as amended (42 U.S.C. 2273);

il50.46(a) and (b), and 50.54(c) are issued under sec.161b, 68 Stat. 948, as '

y amended (42U.S.C.2201(b));il50.7(a),50.10(a)-(c),50.34(a)and(e),

50.44(a)-(c),50.46(a)and(b),50.47(b),50.48(a),(c),(d),and(e),50.49(a),

50.54(a), (1)~, (1)(1), (1)-(n), (p), (q), (t), (v), and (y), 50.55(f),

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50.55a(a),(c)-(e),(g),and(h),50.59(c),50.60(a),50.62(c)50.64(b),and i

50.80(a) and (b) are issued under sec. 1611, 68 Stat. 949, as ar. ended j

(42U.S.C.2201(i));andil50.49(d),(h),and(j),50.54(w),(z),(bb),(cc),

j and(dd),50.55(e),50.59(b),50.61(b),50.62(b),50.70(a),50.71(a)-(c)and(e),

50.72(a), 50. 3(a) and (b), 50.74, 50.78, and 50.90 are issued under sec. 1610, 68 Stat. 950, as amended (42 U.S.C. 2201(o)).

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Section 50.54'is amended by reui:ir.; Mragra)b (w) to read as follows:

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650.54 Conditions of licenses.

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j (w) Each electric utility licensee under this part for a production i

or utilization facility of the type described in $50.21(b) or-t 950.22 shall take reasonable steps to obtain insurance available at reasonable' costs and on reasonable terms from private sources or to_ demonstrate to the satisfaction of the Commission that it possesses an equivalent amount of protection covering the licensee's obligation, in the event of an accident at the licensee's re6ctor, to stabilize and decontaminate the reactor and the reactor station site at which the reactor experiencing:

1 the accident is located, provided that:

(1) The. insurance required by paragraph -(w) of this section must-i have e minimum coverage limit for sach reactor station site of either $1.06 billion or whatever amount of insurance is generally available from private sources, whichever is less.

The required insurance must clearly state that, as and to the j.

extent provided in paragraph (w)(4) of this section, any

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proceeds must be payable first for stabilization of the reactor and next for decontamination of the reactor and the reactor station site.

If a licensee's coverage falls below the required mininum, the licensee shall within 60 days take all reasonaDie i

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steps to restore its coverage to the required minimum. The re-quired insurance ~may, at the option of the licensee,.be included

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within policies that also provide coverage for other risks, in-cluding, but not limited to, the risk of direct physical damage.

y (2)(1).With respect to policies issued or annually renewed on or after

, [ insert a date 1 year after the effec-l tive date of the. rule] the proceeds of'such required insurance 4

must be dedicated, as and to the extent provided in.this para-

. graph, to reimbursement or payment on behalf of the insured of reasonable expenses incurred or estimated to be incurred by the' licensee in taking action to fulfill the-licensee's obligation, I

in the event of an accident at the licensee's reactor, to ensure that the reactor ~is in, or is returned to, and maintained.in, a safe and stable condition and that radioactive contamination is removed or controlled such that personnel exposures are consis-tent with the occupational exposure linits in 10 CFR'Part 20.-

These actions must be consistent with any other obligation 'the~

i licensee may have under this chapter-and must be subject to paragraph (w)(4) of this'section. As used in this section, an " accident" me6ns an event that involves the release of radioactive material f rom its intended place of confinement within the reactor or on the reactor station site such that there is a present danger of release off site in amounts that-p would pese a threat to the public health and safety.

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-16 (ii) The stabilization and decontamination requirements set forth in paragraph (w)(4) of this section must apply uniformly to611insurancepoliciesrequiredunderparagraph(w)ofthis section.

(?) The licensee shall report to the NRC on April 1 of each year the current levels of this insurance or financial security it main-tains and the sources of this insurance or financial security.

-(4)(i) In the event of an accident at the licensee's reactor, when-ever the estimated costs of stabilizing the licensed reactor and (f decontamihtting the reactor and the reactor st6 tion site exceed $100 millicn, the proceeds of the insurance required by parrgraph (w) of this section must be dedicated to and used, first, to ensure that the licensed reactor is in, or is returned to, and can be maintained in, a safe and stable condition so es to prevent ar.y rignificant risk to the public health and safety end, second, to decontaminate ti.e reactor and the reactor station sitt in accordance with tFe licensee's cleanup plan as approved by order of the Director of the Office of Nuclear Reactor Regulation.

This priority on insurance proceeds must remain in ef fect for 60 days or, upon order of the Director, for such longer periods, in increments not to exceed 60 days except as prcvided for activities under the cleanup plan required in peregraphs (w)(4)(iii) and (iv) of this sectien, as the Dirtctor

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may find necessary to protect the public health and safety.

l Actions needed to bring the reactor to and maintain the. reactor in a safe and stable condition may include one or more of the following, as appropriate:

(A)

$butdown of the reactor; y

(B)

Establishment and maintenance of long-term cooling with stable decay heat removal; (C)

Mainter.ance of sub-criticality; (D)

Control of radioactive releases; and (E)

Securing of structures, cystems, or components to minimize radiation exposure to onsite personnel or to the offsite public or to facilitate later deconteminetion or both.

(ii) The licensee shall inform the Direche of the Office of Nuclear Reactor Regulation in writing when the reactor is~and-can be maintained in a safe and stable condition so as to i

prevent any significant risk to the public health and safety.

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Pithin 30 days after the licensee informs the Director that the reactor is in this condition, or at such earlier time as the licensee may elect or the Director may for good cause direct, the licensee shall prepare and submit a cleanup plan for the Director's approval. The cleanup plan must identify er,d contain an estimate of the cost of each cleanup operation

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that will be required to decontaninate the reactor sufficiently to permit the licensee either to re.ume operation of the reactor or to apply to the Comission under 550.82 for authority to decomission the reactor and to surrender the license volun-tarily. Cleanup operations may include one or more of the-following, as appropriate:

(A) Processing any contaminated water generated by the accident and by decontamination operations to remove radioactive meterials; (B) Decontanination of surf aces inside the auxiliary and fuel-handling buildings end the reactor building to levels consistent with the Commission's occupational exposure limits in 10 CFR Part 20, and decontamination or disposal of equipment; (C) Decontamination or removal and disposal of internal parts and damaged fuel from the reactor vessel; and (D) Cleanup of the reactor coolant system.

(iii) following review of the licensee's cleanup plan, the Director will order the licensee to complete all operations that the Director finds are necessary to decontaminate the reactor sufficiently to permit the licensee either to resume operation I

of the reactor or to apply to the Commission under $50.82 for I

authority to decomission the reactor and to surrender the l

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' license voluntarily. The Director shall approve or disapprove, in whole or in part for stated reasons, the licensee's estimate of cleanup costs for such operations. Such order may not be -

effective for more than 1 year, at which time it ney be renewed.

Each subsequent renewal order, if inposed, may be effective for L

not note than 6 rnonths.

(iv) Of the balance of the proceeds of the required insurance not j

alreedy expended to place the reactor in a safe and stable i

condition purscant to paragraph (w)(2)(i) of this section, an cmount sufficient to cover the expenses of completion of those decontaninetion operations that are the subject of the Director's order shall be dedicated to such use, provided that, upon certification to the Director of the amounts expended previously and fron time to time for stabilization and decontamination and i

upon further certification to the Directnr as to the sufficiency of the dedicated amount remaining, policies of insurance may providt for payment to the licensee or other loss payees of amounts not se dedicated, and the licensee may proceed to use i

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t in parallel (and not. in preference.thereto) any insurance q

proceeds not so' dedicated for other purposes..

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Dated at' Rockville, Maryland, this day of-

1990, l

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For the Nuclear Regulatory Commission.

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James M.-Taylor,

.l LExecutive Director-for Operations.

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STATEMENT OF EXECUTIVE DIRECTOR FOR OPERATIONS AtrF0VING FINAL RULE FOR PUELICATION i

Approved for Publication The Commission delegated to the EDO (10 CFR 1.31(a)(3)) the authority to develop and promulgate rules as defined in the APA (5 U.S.C. 551(4)) subject i

to the limitations in NRC Manual Chapter 0103, Organization and Functions, Office of the Executive Director for Operations, paragraphs 0213, 038, 039, I

and 0310.

The enclosed final rule will revise 10 CFR 50.54(w) to (1) clarify the scope i

and timing of the stabili7ation and decontaminetion processes after an accident at a covered reactor; (2) specify that the insurance is required to ensure that corr.iercial power reactor licensees will have sufficient funds to carry out their obligation to cicar up and decontaminate after an accident; and (3) eliminate the requirement that insurance proceeds after an accident are paid to an independent trustec.

This final rule is issued under general policy guidance from the Comnission, does not constitute a significant question of policy and does not amend regulations contained in 30 CFR Parts 7, 8, or 9 Subpart C concerning matters of policy.

I therefore find that this final rule is within the scope of iny rulemaking authority ard am proceeding to issue it.

Date Jat4s H. Taylcr Executive Director for Operations l

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