ZS-2020-0018, Report on Status of Decommissioning Funding for Shutdown Reactors

Report on Status of Decommissioning Funding for Shutdown Reactors

ML20097C644
Person / Time
Site:	Zion  File:ZionSolutions icon.png
Issue date:	03/26/2020
From:	Gerard van Noordennen ZionSolutions
To:	Document Control Desk, Office of Nuclear Material Safety and Safeguards
References
ZS-2020-0018
Download: ML20097C644 (6)

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An EnergySclutiorrs Company 10 CFR 50.75(f)(l) 10 CFR 50.82(a)(8)

March 26, 2020 ZS-2020-0018 U.S. Nuclear Regulatory Commission ATTN: Document Control Desk Washington, DC 20555-0001

Subject:

Zion Nuclear Power Station, Units 1 and 2 Facility Operating License Nos. DPR-39 and DPR-48 NRC Docket Nos. 50-295 and 50-304 Report on Status of Decommissioning Funding for Shutdown Reactors

References:

1. Exelon Generation Corporation (EGC) Letter RS-08-009, "Application for License Transfers and Conforming Administrative License Amendments," dated January 25, 2008

2. Nuclear Regulatory Commission (NRC) Letter, J. Hickman to P. Daly, ZionSolutions, LLC, "Order Approving Transfer of Licenses and Conforming Amendments Relating to Zion Nuclear Power Station, Units 1 and 2," dated May 4, 2009

3. ZionSolutions, LLC Letter, P. Daly to NRC, "Notification of Amended Post-Shutdown Decommissioning Activities Report (PSDAR) for Zion Nuclear Power Station, Units 1 and 2," dated March 18, 2008

4. ZionSolutions, LLC Letter, D. Beckman to J. Hickman, "Notification of a Significant Schedule Change from that provided in the Amended Post-Shutdown Decommissioning Activity Report," dated November 23, 2010

5. NRC Letter, A. Persinko to J. Sauger, ZionSolutions, LLC, "Zion Nuclear Power Station, Units 1 and 2, Request for Exemption from Certain Decommissioning Trust Fund Requirements of the Decommissioning Regulations," dated July 21, 2014

6. ZionSolutions, LLC Letter, G. van Noordennen, "Report on Status of Decommissioning Funding for Shutdown Reactors," dated March 26, 2019

7. NRC Letter, J. Hickman to J. Sauger, "Zion Nuclear Power Station, Units 1 and 2-Request for Additional Information Related to the Status of Decommissioning Funding for Shutdown Reactors, dated May 22, 2019.

In accordance with 10 CFR 50.75, "Reporting and recordkeeping for decommissioning planning,"

paragraph (f)(l), and 10 CFR 50.82, "Termination of license," paragraph (a)(8), ZionSolutions, LLC (ZS) is submitting a report on the status of funding for decommissioning Z1on Nuclear Power Station (ZNPS),

Units 1 and 2, and managing the associated irradiated fuel. The revised annual radiological decommissioning and irradiated fuel management funding assurance report for ZNPS is provided in to this letter for the period ending December 31, 2019.

101 Shiloh Boulevard, Zion

• IL 60099 (224) 789-4016

• Fax: (224) 789-4008

• www.zionsolutionscompany.com

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ZionSolutions, LLC ZS-2020-0018 Page 2 of 3 The minimum required decommissioning funding assurance amount is based on a site-specific decommissioning cost estimate determined in accordance with 10 CPR 50.82(a). A change to the spent fuel management strategy was described in the application for license transfer (Reference 1), accepted by the NRC via Reference 2, and further described in the amended PSDAR (Reference 3). Reference 4 provided the decommissioning schedule that included adjustments resulting from incorporation of the actual calendar date of the asset and NRC license transfers as well as refinement of individual activity sequencing as the project planning achieved more detail.

Each of those references addressed the project's planning and scheduling basis, the associated estimated costs and the available funds for decommissioning, decontamination, dismantlement, and spent fuel management of both ZNPS units as an integrated project. As described in those references, radiological decommissioning as represented by the ZNPS integrated plan includes removal of the fuel to a dry storage facility and the decontamination and dismantlement of the radiologically involved systems, structures, and components. The attached decommissioning cost estimate does not include the costs of dismantling non-radiological systems and structures and other non-radiological site restoration. A ZS exemption was issued by the NRC to confirm ZS authority to use the decommissioning trust fund for costs associated with both decommissioning activities and spent fuel management (Reference 5).

ZS agreements with EGC include rights that will enable ZS to return the decontaminated site and transfer the Independent Spent Fuel Storage Installation (ISFSI), spent fuel, remaining Greater than Class C (GTCC) waste, and associated NRC licenses to EGC on or before September 1, 2020. Once these transfers are accomplished, EGC would maintain the irradiated fuel, including ongoing financial responsibility, until title to and possession of the irradiated fuel is transferred to the Department of Energy for its ultimate disposition. These latter, ongoing costs are not included in the decommissioning estimates herein.

NRC review of this decommissioning management strategy and the associated funding and cost estimate was accomplished as part of the NRC approval of the transfer of the ZNPS operating licenses to ZS (Reference 2). For purposes of consistency with References 1, 2 and 3, the results of the end of year 2019 funding and cost estimate shown in Attachment 1 are aggregated for the entire project as Unit 1 and Unit 2 are being decommissioned concurrently as a single integrated project. This is consistent with the licensing basis and integrated plans for sequencing radiological decommissioning and fuel management reflected in the references. Since the time of the last estimate provided in Reference 3, the cost and funding estimate have been adjusted for market value changes in the decommissioning trust fund (DTP),

refinement of the cost and schedule estimate reflecting more mature knowledge gained from the new cost-significant contracts for various decommissioning and fuel management activities, and more developed cost allocations among the activities for radiological and non-radiological work. While this report excludes costs and discussion of non-radiological site restoration, ZS will complete that work as part of the contract scope with EGC. provides the aggregated, minimum estimated cost (funds needed) for concurrent radiological decommissioning of both nuclear units and for used fuel management for the remainder of the ten year contract period (corresponding to Item Bin Attachment 1), as defined by the prior submittals, planned decommissioning sequences, and work breakdown structure. This estimate has been developed from the site aggregate decommissioning schedule and provides the cost and funding allocation necessary to optimally decommission the radiologically involved systems, structures and components consistent with the NRC accepted decommissioning strategy. For completeness, the funding amount from the trust for both Unit 1 and Unit 2, as components of the total DTP value (Item A); the projected end of project surplus (Item D), based on the trust fund amount as of December 31, 2019, less the estimate of costs to complete decommissioning, plus annual earnings and less taxes through the end of the project on or before 2020; the estimated cost to complete decommissioning activities (Item E); the projected costs to

ZionSolutions, LLC ZS-2020-0018 Page 3 of 3 manage the irradiated fuel until fuel management responsibility transfers back to EGC on or before September 1, 2020 (Item F); and the total amount spent on decommissioning (Item G), both cumulatively (September 2010 - December 31, 2018) and for calendar year 2019 is included in the attached report and is accurate as of December 31, 2019.

Disbursements from the trust fund have been made in accordance with the conditions of the ZNPS licenses, including the required advance notifications to the Office of Nuclear Reactor Regulation.

There are no regulatory commitments contained within this letter.

If you have any questions about this letter, please contact me at (860) 462-9707.

Respectfully, Gerard van N oordennen Senior Vice President Regulatory Affairs cc:

John Hickman, U.S. NRC Senior Project Manager Service List Attachments:

Annual Radiological Decommissioning and Irradiated Fuel Management Funding Assurance Report for Zion Nuclear Power Station, Aggregate Costs

' i

Zion Nuclear Power Station, Unit 1 and 2 License Transfer Service List cc:

Ken Robuck President and CEO Energy Solutions 299 South Main Street, Suite 1700 Salt Lake City, UT 84111 John Sauger President and Chief Nuclear Officer ReactorD&D Energy Solutions 121 W. Trade Street, Suite 2700 Charlotte, NC 28202 Bruce Hinkley Senior Vice President D&D Operations Energy Solutions 121 W. Trade Street, Suite 2700 Charlotte, NC 28202 Gerard van N oordennen Senior Vice President Regulatory Affairs Energy Solutions 121 W. Trade Street, Suite 2700 Charlotte, NC 28202 Russ Workman General Counsel Energy Solutions 299 South Main Street, Suite 1700 Salt Lake City, UT 84111 Regional Administrator U.S. NRC, Region III 2443 Warrenville Road Lisle, IL 60532-4352 Steven A. Reynolds Manager, Nuclear Facility Inspection Division of Nuclear Safety Illinois Emergency Management Agency 245 W. Roosevelt Road, Units 55 & 56 West Chicago, Illinois 60185 Kelly F. Grahn Senior Health Physicist Illinois Emergency Management Agency Division of Nuclear Safety 245 W Roosevelt Road, Building 8, Suite 55 West Chicago, IL 60185 William P. Mazzeno Emergency Management Coordinator Lake County Emergency Management Agency 1303 N. Milwaukee Avenue Libertyville, IL 60048-1308 John E. Matthews Morgan, Lewis & Bockius LLP 1111 Pennsylvania A venue, NW Washington, DC 20004

ZionSolutions, LLC ZS-2020-0018: Attachment 1 Page 1 of2 ATTACHMENT 1 Annual Radiological Decommissioning and Irradiated Fuel Management Funding Assurance Report for Zion Nuclear Power Station, Aggregate Costs December 31, 2019 (2019 dollars, millions)

Trust Fund Amount at December 31, 2019 (A 1)

Funding Assurance (Letter of Credit) other than the Trust Fund Amount (A2)

NRC Required Minimum Funding Assurance Amount at December 31, 2019 (B)=(E)+(F)

Difference in Trust Fund Amount versus Required Minimum Funding at December 31, 2019-Surplus/(Shortfall) (C) = (Al) - (B)

Difference in Total Funding Assurance Amount versus Required Minimum Funding Assurance at December 31, 2019 (Al)+(A2)-(B)

Projected End of Project Surplus at December 31, 2019 (D)

Estimated Costs to Complete Decommissioning at December 31, 2019 (E)

Projected Costs to Manage Irradiated Fuel at December 31, 2019 (F)

Amount Spent on Decommissioning (G):

Cumulative (September 2010-December 31. 2018)

Calendar Year 2019 Cumulative (September 2010-December 31, 2019)

$5.3M

$25M1

$5.4M

($0. lM)

$24.9

$0.02

$3.3M

$2.1M3

$651.5

$6.3M

$657.8M4 1 This NDT position, together with $25 million Letter of Credit backup for the NDT provides sufficient funding and financial assurance for the completion ofradiological decommissioning of the Zion Project. EnergySolutions will continue to fund additional decommissioning project activities using company cash reserves.

2 Value is based on the trust fund amount as of December 31, 2019, less the estimate of costs to complete decommissioning, plus annual earnings and less tax through the end of the project.

3 This represents the costs to complete the safe, secure operation of the ISFSI and associated infrastructure until the Zion site transitions back to EGC.

4 The amounts spent on decommissioning represents withdrawals made from the trust fund reported for radiological decommissioning.

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ZionSolutions, LLC ZS-2020-0018: Attachment 1 Page 2 of2 General Notes:

The required minimum funding assurance amount is based on the decommissioning scenario from the site-specific decommissioning cost estimate provided in Reference 3.

The cost estimate reflects actual experience to date, as well as forecast refinements made through the date of this filing.

There are no additional funds to be collected.

A 2% annual real rate of return is assumed in these calculations.

There are no contracts relied upon pursuant to 10 CFR 50.75(e)(l)(v).

Financial assurance for decommissioning is provided by the prepayment method, coupled with an external trust fund, in accordance with 10 CFR 50.75(e)(l)(i), in conjunction with a $25 million Letter of Credit payable to the Backup Decommissioning Trust in accordance with 10 CFR 50.75 (e)(l)(iii). EnergySolutions has provided, and will continue to provide, to ZionSolutions funds necessary to complete decommissioning.

There are no material changes to the trust fund agreements or financial assurance contracts as described at the time of transfer of the licenses, except for the reduction of the Letter of Credit held by EGC. Pursuant to the contract between Energy Solutions and EGC, the Letter of Credit amount plus Trust Funds will be at least 200% of the remaining costs to complete decommissioning. As of December 31, 2019, the Letter of Credit amount had been reduced to $25 million.

ZS has funds sufficient to meet its obligations to manage spent fuel safely as requisite to the current cost estimates for the project and pursuant to 10 CFR 50.82(a)(8)(vii). The estimated cost to manage the irradiated fuel, as reported above (Item F), includes O&M and Security costs associated with managing the ISFSI until the site transitions back to EGC.

Upon completion of the decommissioning project, ZS will transfer the ISFSI to EGC.

EGC will assume responsibility to manage the spent fuel safely from that date until title to and possession of the irradiated fuel is transferred to the Secretary of Energy for its ultimate disposition. On September 1, 2010, in accordance with the ASA, EGC retained

$25 million of the Decommissioning Trust Fund for this purpose. The $25 million retained by EGC is not included in the remaining Decommissioning Trust Fund amount as reported above (Item A).

Inquiries regarding the management of spent nuclear fuel beyond completion of the decommissioning project should be directed to EGC.