ML20079D788

Decommissioning Funding Status Report

ML20079D788
Person / Time
Site:	Three Mile Island
Issue date:	03/18/2020
From:	Halnon G GPU Nuclear
To:	Document Control Desk, Office of Nuclear Reactor Regulation
References
TMl-20-003
Download: ML20079D788 (10)

Text

(t;pu NUCLEAR GPU Nuclear, Inc.

Thrue Milo band Nuclear Sta1Jon Route 441 South PDs1 Office Box 480 Middletown, PA 17057*0480 Toi 717*948-8461 March 18, 2020 TMl-20-003 10 CFR 50.75 10 CFR 50.82 ATTN: Document Control Desk U.S. Nuclear Regulatory Commission Washington, D.C. 20555-0001

SUBJECT:

Three Mile Island Nuclear Station, Unit 2 Docket No. 50-320, License No. DPR-73 Decommissioning Funding Status Report for the Three Mile Island Nuclear Station. Unit 2 Pursuant to 10 CFR 50.75 and 10 CFR 50.82, GPU Nuclear, Inc. is hereby submitting the following three reports to the Nuclear Regulatory Commission (NRC) for Three Mile Island Nuclear Station, Unit 2 for the year ending December 31, 2019. Attachment 1 provides a decommissioning funding status report based on the NRC formula described in 10 CFR 50.75(c). Attachment 2 provides a decommissioning funding status report based upon a site-specific decommissioning cost estimate (DCE). Attachment 3 contains a financial assurance status report as required by 10 CFR 50.82(a)(8)(v).

There are no regulatory commitments contained in this letter. If there are any questions or if additional information is required, please contact Mr. Michael Casey, GPU Nuclear Responsible Engineer TMl-2 at (330) 472-8589.

Sincerely, Grego . alnon President and Chief Nuclear Officer GPU Nuclear, Inc.

Three Mile Island Nuclear Station, Unit 2 TMl-20-003 Page2 Attachments:

1. Three Mile Island Nuclear Station, Unit 2 Decommissioning Funding Status Report - NRC Formula

2. Three Mile Island Nuclear Station, Unit 2 Decommissioning Funding Status Report -

Site-Specific Decommissioning Cost Estimate

3. Three Mile Island Nuclear Station, Unit 2 Financial Assurance Status Report cc: NRC Region I Administrator NRC Project Manager

Attachment 1 TMl-20-003 Three Mile Island Nuclear Station, Unit 2 Decommissioning Funding Status Report - NRC Formula Page 1 of 3 This report reflects the FirstEnergy Corp. subsidiary ownership interests in the Three Mile Island Nuclear Station, Unit 2 as of December 31, 2019.

1. The minimum decommissioning fund estimate, pursuant to 10 CFR 50.75(b) and (c) (see Schedule 1):

Metropolitan Edison Company $253,900,951 Pennsylvania Electric Company 126,950,476 Jersey Central Power & Light Company 126,950,476 FirstEnergy Corp. Consolidated $507,801.902

2. The amount accumulated in external trust funds:

After Tax Metropolitan Edison Company $416,484,439 Pennsylvania Electric Company 223, 146,819 Jersey Central Power & Light Company 259,856, 169 FirstEnergy Corp. Consolidated $899.487.427

3. There are no longer any funds being collected from the ratepayers.

4. The assumptions used regarding escalation in decommissioning cost, rates of earnings on decommissioning funds, and rates of other factors used in funding projections:

Consolidated Ownership Interest in Unit 100%

Estimated Net Investment Rate 2.00%

Year of Site Restoration Completion 2053 Three Mile Island Nuclear Station, Unit 2 transitions from a Post-Defueling Monitored Storage status to decommissioning in 2040.

5. There are no contracts upon which the owners/licensees are relying pursuant to 10 CFR 50.75(e)(1)(v).

6. There are no modifications to the licensee's current method of providing financial assurance since the last submitted report.

TMl-20-003 Page 2 of 3

7. There were no amendments to the trust agreements for the above-mentioned owners of Three Mile Island Nuclear Station, Unit 2.

8. Mathematical rounding was performed during the development of the supporting calculations.

TMl-20-003 Page 3 of 3 Schedule 1 FIRSTENERGY CORP.

Calculation of Minimum Financial Assurance Amount December 31, 2019 THREE MILE ISLAND NUCLEAR STATION, UNIT 2 Pennsylvania Regions Labor (L) = Northeast Energy (E) = National Waste Burial (B) = Generic For PWR Unit Adjustment Escalation Factor Ratio Factor1 L= 3.04 0.65 1.976 E= 2.348 0.13 0.305 B= 12.853 0.22 2.828 PWR Escalation Factor= 5.109 Base Amount for PWR between 1200 MWt and 3400 MWt = ($75 + 0.0088P) million (P = power level in megawatts thermal = 2772)

($75 + 0.0088(2772)) million = $99,393,600 Escalated Amount for unit1 =

99,393,600 x 5.109 = $507.801.902 Owner/Licensee 1 Ownership Pennsylvania Electric Company 25% $126,950,476 Jersey Central Power & Light Company 25% $126,950,476 Metropolitan Edison Company 50% $253.900.951 FirstEnergy Corp. Consolidated 100% $507.801.902 Note 1: Mathematical rounding was performed during the development of the supporting calculations.

Attachment 2 TMl-20-003 Three Mile Island Nuclear Station, Unit 2 Decommissioning Funding Status Report - Site-Specific Decommissioning Cost Estimate Page 1of4

1. Decommissioning funds estimated to be required pursuant to 10 CFR 50.75(b) and (c) are based upon a site-specific decommissioning cost study, 2018 Decommissioning Cost Estimate for FirstEnergy, Three Mile Island, Unit 2, dated December 12, 2018:

NRC License Termination $1,353,638,075

2. The amount accumulated in external trust funds as of December 31, 2019:

After Tax Metropolitan Edison Company $416,484,439 Pennsylvania Electric Company 223, 146,819 Jersey Central Power & Light Company 259,856,169 FirstEnergy Corp. Consolidated $899.487.427

3. There are no longer any funds being collected from the ratepayers.

4. The assumptions used regarding escalation in decommissioning cost, rates of earnings on decommissioning funds, and rates of other factors used in funding projections:

Consolidated Ownership Interest in Unit 100%

Estimated Rate of Escalation in Decommissioning Costs 0.00%

Estimated After-Tax Rate of Return 2.00%

Year of Site Restoration Completion 2053 Three Mile Island Nuclear Station, Unit 2 transitions from a Post-Defueling Monitored Storage status to decommissioning in 2040.

All costs are based on a site-specific decommissioning cost study, 2018 Decommissioning Cost Estimate for FirstEnergy, Three Mile Island, Unit 2, dated December 12, 2018, then escalated to 2019 dollars using an escalation factor of 2.78% as documented in Escalation Analysis for Three Mile Island Unit 2, dated February 2015.

5. There are no contracts upon which the owners/licensees are relying pursuant to 10 CFR 50.75(e)(1)(v).

6. There are no modifications to the licensee's current method of providing financial assurance since the last submitted report.

TMl-20-003 Page 2 of 4

7. There were no amendments to the trust agreements for the above-mentioned owners of Three Mile Island Nuclear Station, Unit 2.

8. Site-Specific Cost Analysis Assumptions 10 CFR 50.75(e)(1)(i), states, in part, that:

A licensee that has prepaid funds based on a site-specific estimate under 50.75(b)(1) of this section may take credit for projected earnings on the prepaid decommissioning trust funds, using up to a 2 percent annual real rate of return from the time of future funds' collection through the projected decommissioning period, provided that the site-specific estimate is based on a period of safe storage that is specifically described in the estimate.

In accordance with Regulatory Guide 1.159, Revision 2, Assuring the Availability of Funds for Decommissioning Nuclear Reactors, a facility specific analysis may be used to demonstrate the adequacy of decommissioning funds, provided that:

NRG-required cost estimate for decommissioning costs, as defined in 10 CFR 50.2, is equal to or greater than the amount stated in the formulas in 10 CFR 50.75(c)(1) and (2).

The site-specific radiological decommissioning cost estimate is $1,353,638,075, which is greater than the 10 CFR 50.75(c) cost estimate of $507,801,902. The analysis assumes a 2 percent yearly rate of return. The analysis also assumes a period of safe storage. The cash flows were contained in a decommissioning cost estimate that was prepared for Three Mile Island Nuclear Station, Unit 2. The cash flow analysis assumes the yearly expenses are incurred at the beginning of year.

Schedule 1 provides the site-specific analysis. The analysis values are in 2019 dollars.

The analysis is based on TMl-2 transitioning from Post-Defueling Monitored Storage status to decommissioning in 2040 and includes expenditures for license termination costs only.

9. Mathematical rounding was performed during the development of the supporting calculations.

10.

References:

A. 2018 Decommissioning Cost Estimate for FirstEnergy, Three Mile Island, Unit 2, dated December 12, 2018 (Accession No ML19087A153)

B. Escalation Analysis for Three Mile Island Unit 2, 2013 Site-specific Decommissioning Cost Estimate, February 2015 (Accession No. ML15086A337)

TMl-20-003 Page 3 of 4 Schedule 1 FIRSTENERGY CORP.

Funding Analysis December 31, 2019 THREE MILE ISLAND NUCLEAR STATION, UNIT 2 After-Tax Estimated Net Investment Rate 2.00%

Estimated Escalation Rate 0.00%

Estimated After-Tax Rate of Return 2.00%

Qualified Trust Balance on December 31, 2019 899,487,427 After-Tax Non-Qualified Trust Balance on December 31, 2019 Total 899.487.427 Beginning Ending Year Balance Deposits Earnings Withdrawal 1*2 *3 Balance 2019 899,487,427 - - - 899,487,427 2020 899,487,427 - 17,918, 187 (3,578,084) 913,827,530 2021 913,827 530 - 18,204,989 (3,578,084) 928,454,435 2022 928,454,435 - 18,497,527 (3,578,084) 943,373,877 2023 943,373,877 - 18,795,916 (3,578 084) 958,591, 709 2024 958,591 709 - 19, 100,273 (3,578,084) 974,113,898 2025 974,113 898 - 19,410,716 (3,578,084) 989,946,530 2026 989,946,530 - 19,727,369 (3,578 084) 1,006,095,814 2027 1,006,095,814 - 20,050,355 (3,578,084) 1,022,568,085 2028 1,022,568,085 - 20,379,800 (3,578,084) 1,039,369,801 2029 1,039,369 801 - 20,715,834 (3,578,084) 1,056,507,551 2030 1,056,507 551 - 21 ,058,589 (3,578,084) 1,073,988,056 2031 1,073,988,056 - 21,408, 199 (3,578,084) 1,091,818, 172 2032 1,091 ,818,172 - 21 764,802 (3,578,084) 1,110,004,889 2033 1, 110,004,889 - 22, 128,536 (3,578,084) 1,128,555,341 2034 1,128,555,341 - 22,499,545 (3,578,084) 1, 147,476,802 2035 1,147,476 802 - 22,877,974 (3,578,084) 1, 166, 776,692 2036 1, 166,776,692 - 23,263,972 (3,578,084) 1, 186,462,580 2037 1, 186,462,580 - 23,623,692 (5,278,004) 1,204,808,268 2038 1,204,808,268 - 23,962 ,039 (6,706 312) 1,222,063,996 2039 1,222,063,996 - 24,307,154 (6,706,312) 1,239,664,838 2040 1,239,664,838 - 24,437,628 ( 17,783,426) 1,246,319,040 2041 1,246,319,040 - 23,877,509 (52,443,613) 1,217,752,935 2042 1,217,752,935 - 21 ,976,858 (118,910 032) 1,120,819,761 2043 1,120,819,761 - 20,000,716 (120,783,957) 1,020,036,520 TMl-20-003 p age 4 0 f 4 Beginning Ending Year Balance Deposits Earninas Withdrawal 1*2*3 *4 Balance 2044 1,020,036,520 - 16 929,487 (173,562, 182) 863,403,824 2045 863,403,824 - 13,795,101 (173,648, 756) 703,550, 170 2046 703,550,170 - 10,621 ,790 (172,460,694) 541 ,711,265 2047 541 ,711 ,265 - 9,860,006 (48,710,956) 502,860,316 2048 502,860,316 - 9,031 ,742 (51,273,222) 460,618,835 2049 460,618,835 - 7,589,460 (81 ,145,827) 387,062,469 2050 387,062,469 - 6,312,818 (71,421,589) 321 ,953,697 2051 321 953,697 - 5,004,887 (71 ,709,357) 255,249,227 2052 255,249,227 - 3 630 945 (73,701 ,996) 185, 178, 175 2053 185, 178, 175 - 2 943,495 (38,003,419) 150, 118,251 2054 5 150, 118 25 1 - 2,831, 145 (8,560,991 ) 144,388,406 (1,353,638,075)

( 1) reflects Safstor method from Energy Solutions Scenario 2 Safstor 1, withdrawals assumed to be made in the beginning of the period (2) There were no funds withdrawn from the decommissioning trust fund for years 2013, 2014, 2015, 2016, and 2017 (3) In 2018 $312,743.81 was withdrawn from the decommissioning trust fund for Decommissioning Planning, in 2019 $76,788.96 was withdrawn from the decommissioning trust fund for Decommissioning Planning (4) Withdrawals based upon a site-specific decommissioning cost study, 2018 Decommissioning Cost Estimate for FirstEnergy, Three Mile Island, Unit 2, dated December 12, 2018, then escalated to 2019 dollars using an escalation factor of 2.78% as documented in Escalation Analysis for Three Mile Island Unit 2, dated February 2015 (5) 2054 costs cover potential unresolved license termination invoices and costs from the previous years.

Attachment 3 TMl-19-003 Three Mile Island Nuclear Station, Unit 2 Financial Assurance Status Report Page 1of1

1. Formal decommissioning has not started at Three Mile Island Nuclear Station, Unit 2. A special disbursement of decommissioning trust funds occurred in 2005 for $416,400.00.

Notification of this use of decommissioning funds was made to the NRC by letter dated February 1, 2005 (Accession No. ML050380143). $312,743.81 was spent on decommissioning planning activities in 2018 and $76,788.96 was spent on decommissioning planning activities in 2019.

2. Decommissioning funds estimated to be required are based upon a site-specific decommissioning cost study, 2018 Decommissioning Cost Estimate for FirstEnergy, Three Mile Island, Unit 2, dated December 12, 2018, then escalated to 2019 dollars using an escalation factor of 2.78% as documented in Escalation Analysis for Three Mile Island Unit 2, dated February 2015:

NRC License Termination $1,353,638,075 As noted on Attachment 2, Schedule 1, FirstEnergy Corp. Funding Analysis dated December 31, 2019.

3. The amount accumulated in external trust funds as of December 31, 2019:

After Tax Metropolitan Edison Company $416,484,439 Pennsylvania Electric Company 223,146,819 Jersey Central Power & Light Company 259,856, 169 FirstEnergy Corp. Consolidated $899.487.427

4. There are no longer any funds being collected from the ratepayers.

5. There are no modifications to the licensee's current method of providing financial assurance since the last submitted report.

6. There were no amendments to the trust agreements for the above-mentioned owners of Three Mile Island Nuclear Station, Unit 2.

7. Mathematical rounding was performed during the development of the supporting calculations.

8.

References:

A 2018 Decommissioning Cost Estimate for FirstEnergy, Three Mile Island, Unit 2, dated December 12, 2018 (Accession No ML19087A153)

B. Escalation Analysis for Three Mile Island Unit 2, 2013 Site-specific Decommissioning Cost Estimate, February 2015 (Accession No. ML15086A337)