ML20151B972
| ML20151B972 | |
| Person / Time | |
|---|---|
| Issue date: | 04/05/1988 |
| From: | Chilk S NRC OFFICE OF THE SECRETARY (SECY) |
| To: | |
| References | |
| TASK-RIA, TASK-SE AA40-2-52, SECY-88-094, SECY-88-94, NUDOCS 8804120065 | |
| Download: ML20151B972 (206) | |
Text
.,
. g'l '
s p* "*w
+. /
RULEMAKING ISSUE (Affirmation)
April 5, 1988 SECY-88-94 FOR: The Commissioners -
FROM: h$uelJ. Chilk, Secretary
SUBJECT:
FINAL RULE AMENDMENTS TO 10 CFR PARTS 30, 40, 50, 51, 70, and 72: GENERAL REQUIREMENTS FOR DECOMMISSIONING NUCLEAR FACILITIES (SECY-87-309)
PURPOSE: To obtain Commission approval for publication of a Notice of Final Rulemaking..
BACKGROUND: In a March 2, 1988 staff requirements l memorandum the Commission requested the staff to revise the final rule on decommissioning and return it for review and affirmation. The attached package from the EDO contains the revised final rule.
s
Enclosure:
As Stated CONTACT:
A. Bates (SECY)
.v.41400 O M I 2 006
%w -
%d 2 0 ( p,s .
t _
4 Commissioners comments or consent should be provided directly to SECY by c.o.b. April 25, 1988.
Commission staff office comments, if any, should be submit-ted to the Commissioners NLT April 10, 1988, with an information copy to SECY. If the paper is of such a nr.ture that it requires additional time for analytical review and comment, the Commissioners and the Secretariat should be apprised of when comments may be expected.
This paper is tentatively scheduled for affirmation at an open meeting during the week of April 25, 1988. Please refer to the appropriate weekly Commission Schedule, when published, for a specific date and time.
DISTRIBUTION:
Commissioners OGC (II Street)
OI OIA GPA REGIONAL OFFICES EDO OGC (WF)
Ms ha an g'#o
. UNITED STATES
. [' ' ' 'k t.. .l NUCLEAR REGULATORY COMMISS ' -
WASHINGTON, D. C. 20555 . I RECORD COP
%...../ MAR 311998 MEMORANDUM FOR: Samuel J. Chilk Secretary of the Comission FROM: Victor Stello, Jr.
Executive Director for Operations
SUBJECT:
RESPONSE TO STAFF REQUIREMENTS MEMORANDUM 0F MARCH 2, 1988 RE: SECY-87-309 - FINAL RULE AMENDMENTS TO 10 CFR FARTS 30, 40, 50, 51, 70, AND 72: GENERAL REQUIREMENTS FOR DECOMMIS-SIONING NUCLEAR FACILITIES In response to the subject Staff Requirements Memorandum (SRM) I am enclosing for Commission review and affirmation vote a revised version of the decommis-sioning rule contained in SECY-87-309. The revised rule has the following modifications:
- 1. Response to Item 1 of the SRM For electric utility power reactor licensees, the rule has been revised to require use of funding methods external to licensee's assets and control.
The text of the rule has been modified by deleting the sections permitting licensees to use internal reserve, i.e, 650.75(e)(1)(iv) and $50,75(e)(3)(iv) on pages 142 and 144 of Enclosure A of SECY-87-309. The ration Q for this requirement is contained in the revised Supplementary Information, see Enclosure A of this memorandum, beginning on page 53 (Section 3, "Acceptable Funding Methods") and continuing through the end of page 61. As part of that rationale, the discussion in the second full paragraph on page 61 indi-.
cates how the impact of this requirement on utilities has been minimized. The rule has not been revised for materials licensees and nonpower reactor li-censees because the amended parts pertaining to these licensees require use of external reserves and surety bonds, or parent company guarantees backed up by financial tests. j l
- 2. Response to Items 2 and 4 of the SRM !
The sentence identified in Item 2 of your memorandum has been inserted on page 3 of Enclosure A. In addition, Page 56 of Enclosure A has been revised l in accordance with Item 4 of your memorandum.
l
. i San.uel J.'Chilk 2 With respect to Item 3 of the SRM, the staff plans to issue interim guidance in 1988 on dose guidelines and criteria for demonstrating compliance with these dose guidelines which will allow development of residual radioactivity limits.
This effort will be coordinated r!ith the development of the Commission policy on generic below regulatory concern dose levels.
Q_
M Victor Stello, Jr.
Executive Director for Operations
Enclosure:
As stated cc: Chairman Zech Commissioner Roberts Commissioner Bernthal Commissioner Carr Commissioner Rogers OGC GPA L
e
e
. O A
e ob e
4 ENCLOSURE A .
1
NUCLEAR REGULATORY COMMISSION 10 CFR Parts 30, 40, 50, 51, 70, and 72 General Requirements for Decommissioning Nuclear Facilities AGENCY: Nuclear Regulatory Commissioq.
ACTION: Final rule.
SUMMARY
- The Nuclear Regulatory Commission is amending its regulations to set forth technical and financial criteria for decommissioning licensed nuclear facilities. The amended regulations address decommissioning plan-
'ning needs, timing, funding methods, and environmental review requirements.
The intent of the amendments is to assure that decommissioning of all licensed facilities will be accomplished in a safe and timely manner and that adequate licensee funds will be available for this purpose. The final rule also contains a response to a petition for rulemaking (PRM 22), concerning decommissioning financial assurance, initially filed by the Public Interest Research Group (PIRG), et al. on July 5, 1977.
EFFECTIVE DATE: (Insert a date to allow 30 days following publication in the Federal Register).
FOR FURTHER INFORMATION CONTACT: Keith G. Steyer, Office of Nuclear Regulatory Research, U.S. Nuclear Regulatory Commission, Washington, DC 20555, telephone (301)492-3824.
1 Enclosure A m .. _____m
(7590-01]. ,
SUPPLEMENTARY INFORMATION:
Introduction The NRC is amending its regulations to provide specific requirements for the decommissioning of nuclear facilities. Specifically the regula-tions establish criteria in the following areas: acceptable decommission-ing alternatives; planning for decommissioning; assurance of the avail-ability of funds for decommissioning; and environmental review require-ments related to decommissioning.
Decommissioning as defined in the rule means to remove nuclear .
facilities safely from service and to reduce residual radioactivity to a level that permits release of the property for unrestricted use and termi-I nation of the license. Decommissioning activities are initiated when a i licensee decides to terminate licensed activities. Decommissioning activi- ,
i ties do not include the removal and disposal of spent fuel which is con-c sidered to be an operational activity or the removal and disposal of non-radioactive structures and materials beyond that necessary to terminate l the NRC license. Disposal of nonradioactive hazardous waste not necessary i
f for NRC license termination is not covered by these regulations but would '
be treated by other appropriate agencies having responsibility over these I
wastes. If nuclear facilities are to be reused for nuclear purposes, applications for license renewal or amendment or for a new license are
! r submitted according to the appropriate existing regulation. Reuse of a nuclear facility for other nuclear purposes is not considered decommis-sioning because the facility remains under license.
1 These amendments apply to the decommissioning of power reactors, i
nonpower reactors, fuel reprocessing plants, fuct fabrication plants, i
l uranium hexafluoride production plants, independent spent fuel storage {
1 2 Enclosure A j
. ___ . -b
installations, and n:nfuel-cycle nuclear facilities. The decommission-ing of uranium mills and mill tailings, low-level waste burial facilities, and high-level waste repositories, has been treated in separate regula-tory actions. These amendments apply to nuclear facilities that operate through their normal lifetime, as well as to those that may be shut down prematurely.
The purpose of these amendments is'to assure that decommissionings '
will be carr:id out with minimal impact on public and occupational health and safety and the environment. The Commission's objective is that decommissioned facility sites would ultimately be available for unrestricted use for any public or private purpose. The amendments provide a regulatory framework for more efficient and consistent licensing actions related to decommissioning. Although decommissioning is not an imminent health and safety problem, the nuclear industry is maturing, in that nuclear facilities have been operating for a number of years, and the number and complexity of facilities that will require decommissioning is expected to increase in the near future. Inadequate or untimely consid-eration of decommissioning, specifically in the areas of planning and financial assurance, could result in significant adverse health, safety and environmental impacts. These impacts could lead to increased occupa-tional and public doses, increased amounts of radioactive waste to be disposed of, and an increase in the number of contaminated sites. The regulations make clear that the licensee is responsible for the funding l and completion of' decommissioning in a manner which protects public health and safety. Current regulations cover the requirements and criteria for decommissioning in a limited way and are not fully adequate to deal with licensee decommissioning requirements effectively. Many 3 Enclosure A
. _ ._ . __ _.. . _- ^
(7590-01] ,
licensing activities concerning decommissioning have had to be determined i on a case-by-case basis. Thfs procedure results in inconsistency in j i
dealing with licensees and in inefficient and unnecessary administrative !
a effort. With the increased number of decommissionings expected, case-by- l case procedures would make licensing difficult and increase NRC and l license 6 staff resources needed for these activities.
i a
l Background l On March 13, 1978, the Commission published an Advance Notice of ;
Proposed Rulemaking in the Federal Register (43 FR 10370] stating that I
the Commission was reevaluating its decommissioning policy and consider- l ing amendments to its regulations to provide more specific requirements !
r j ,
relating to the decommissioning of nuclear facilities. The plan for the t reevaluation included the development of an information base, the pre-paration of a generic environmental impact statement (GEIS), and based 1 .
j on these, the development of amendments to the regulations. The infor- !
4 mation base for preparation of the final rule is complete and consists >
1 1
primarily of a series of NUREG/CR reports on studies of the technology, 2
safety, and costs of decommissioning various kinds of nuclear facilities.
t I
I These reports were prepared by Battelle Pacific Northwest Laboratories (PNL).1 In addition, preliminary staff positions on the major decommis-i sioning issues have been presented in staff (NUREG) reports. On
(
l February 10, 1981, the Commission announced the availability of the draft l
- GEIS for public comment (46 FR 11666). Section 15 of the draft GEIS i 3A bibliography of the PNL and NRC staff reports and other background
! documents is included at the end of the supplementary information. (
These documents are available for inspection and copying for a fee in i the Conmission's Public Document Room at 1717 H Street W. , I Washington, DC 20555.
4 Enclosure A J i
1 l contains certain policy recor.x ndations. Thase recommendaticns, as modified by comments received on the draft GEIS and other sources, pro-vided the basis for the proposed amendments to the Commission's regulations, j On February 11, 1985, the Commiss1on published a Notice of Proposed
! Rulemaking on Decommissioning Criteria for Nuclear Facilities (50 FR 5600').
The proposed amendetats covered a number of topics related to decommission-ing that would be applicable to 10 CFR' Parts 30, 40, 50, 70, and 72 appli-4 cants and licensees. The original comment period was due to expire May 13, i
1985, but was extended to July 13, 1985 to accommodate requests from ,
interested parties for an extended comment period in order to fully evalu-ate the issues raised and develop comments on the proposed rule. Public comments received on the proposed rule were docketed and may be examined j at the Commission's Public Document Room located at 1717 H Street NW., l 1 Washington, DC. '
I j Acceptable levels of residual radioactivity for release of property for unrestricted use were not proposed as part of this rulemaking. ;
i 1
Commission staff is participating in an interagency working group, organ-l ized by the Environmental Protection Agency (EPA), developing Federal ,
guidance on this subject. Proposed Federal guidelines are anticipated to be published by EPA and EPA has issued an advance notice of proposed rulemaking (51 FR 22264, June 18, 1986). In the interim, NRC is developing
' i interim guidance with respect to residual contamination criteria, i
l I Overview of Comments on Proposed Rule
! A total of 143 different organizations and individuals submitted I j
comments on the proposed rule. The commenters represented a variety of
} Interests. Comments were received from Federal government agencies. l I
i 5 Enclosure A i
- i i
N. ,
State agencies (including-State public utility commissions), local governments, universities, individuals, electric utilities, material .
licensees, public groups, utility and industry groups, and financial, legal, and engineering firms. The commenters offered from one to over 50 comments each and presented a diversity of views. The topics addressed by the commenters addressed a wide range of issues and all parts of the rule.
The general response to the rule was varied. A number of commenters specifically expressed support for the rule in general (or that no comment was needed), although some of these made suggestions for improvements.
One commenter indicated that the proposed amendments will provide a foundation from which acceptable decommissioning planning and implementa- l tion programs can be developed, and another indicated that the Commis-l sion's assumptions underlying the proposed rule are reasonable and f air, i Many specifically commented on the need for rulemaking. For example, one commenter stated that although some states have begun developing regula-tions, their efforts are hampered by the lack of Federal guidelines and another commenter urged the Commission to quickly promulgate a com-prehensive set of regulations governing the planning, safety, and financing of decommissioning. Others implied the need for rulemaking but felt that the proposed rule was inadequate to satisfy its intent and generally recommended stricter, more detailed regulations. A few of these i suggested the rule be redrafted and republished for comment. In contrast, some commenters argued that existing rules were adequate and that this rule was unnecessary, overly prescriptive, and burdensome. For example, one commenter indicated that there is no evidence from experience with power reactors that there would be any adverse impacts in the absence of 6 Enclosure A
this rule and that this rule represented an unfair burden to nuclear power facilities compared to other public risks; and another pointed out that decommissioning methods are regulated by public utility commissions and that NRC should only step in to ensure safety.
The detailed rationale supporting these general comments is presented in the succeeding sections of this Supplementary Information. Modifica-tions have been made to the rule as a' result of some of these more specific comments. Based on its consideration of the comments, the Commission continues to believe that the rule's approach presents the best available method for assuring that licensees develop plans sufficient to carry out !
i decommissioning in a manner which protects public health and safety.
Major issues contained in the public comments and resulting changes in the rule are discussed below. The detailed responses to individual comments are documented in NUREG-1221 entitled "Summary, Analysis and Response to Public Comments on Proposed Rule Amendments on Decommission-ing Criteria for Nuclear Facilities" (Ref. 26). Copies of NUREG-1221 may be purchased through the U.S. Government Printing Office, P.O. Box 37082, Washington, DC 20013-7082. Copies may also be purchased from the National Technical Information Service, U.S. Department of Commerce, 5285 Port Royal Road, Springfield, Va 22161. A copy is available for inspection or copying for a fee in the NRC Public Document Room, 1717 H Street NW.,
Washington, DC 20555. The discussion of comments in this supplementary Information is structured according to the general subjects treated by the rule and discussed in the Supplementary Information to the Proposed Rule.
1hese subjects include, in order of discussion, decommissioning alter-natives and timing, planning, financial a:surance, residual radioactivity limits, environmental review requirements, and other general comments.
7 Enclosure A
Summary and Discussion of Comments on Proposed Rule A. Decommissioning Alternatives and Timing. Comments received on l
the subject of decommissioning alternatives covered several areas. These included clarification of the def hition of decommissioning, criteria used for the choice of the alternative in particular cases, and general questions as to acceptability of the decommissioning alternatives.
- 1. Definition of decommissioning. Two commenters indicated that requiring unrestricted use as part of the definition of decommissioning is too restrictive. Reasons given for this comment include the fact that it would inhibit future use of the site and would preclude alternative decommissioning methods which provide reasonable assurance of public health and safety without releasing the site for unrestricted use. In contre.st four commenters stated that decommissioning should clearly result in safe unrestricted use of the site.
In response, it is the Commission's belief that there l's nothing in the definition which would inhibit future use of the site once the license !
I is terminated. According to amended S 50.2 (and related sections in the
{
other parts) decommissioning is defined as resulting in release of the property for unrestricted use and termination of the license. Unre-stricted use refers to the fact that from a radiological standpoint, no hazards exist at the site, the license can be terminated, and the site can be considered an unrestricted area. This definition is consistent 1
with the definition of an unrestricted area as it exists in 10 CFR 20.3 l i
as being "any area access to which is not controlled by the licensee for purposes of protection of individuals from exposure to radiation and I radioactive materials and any area used for residential quarters." The ,
1 8 Enclosure A l- .
alternativ:s for docommissioning provida different w:ys to accomplish J
decommissioning as defined in the rule, i.e., alternative ways to reduce residual radioactivity to a level permitting release of the property for unrestricted use and termination of license. These alternatives are DECON, SAFSTOR, and ENTOM8 which are discussed in more detail below but
] which primarily consist of activities which either result in prompt dis-P
! mantlement of the facility or which permit a storage period during which radioactive decay can occur prior to dismantlement of the facility. Each
! of the alternatives includes all those activities necessary to lead to l
termination of the NRC license. Once the license is terminated, the facil-ity buildings and site can be used for any other non-nuclear purposes, including industrial purposes. The use made of the facility after termina-I tion of the NRC license is independent of the alternative used to decom-n.lssion the facility. With regard to reuse of the site for nuclear pur- ,
a j
j poses, there is nothing in the rule preventing such reuse. As indicated j above, reuse of the nuclear facility for other nuclear purposes is not i considered decommis**;ning. Therefore, a licensee would not be required to submit a decommissioning plan or apply for termination of license.
) As noted in Sections A.2 through A 4 of this Supplementary l Information, the rule considers the use of alternative decommissioning 1 l
{ methods which delay the completion.of decommissioning thereby not releas-l 1
l ing the site for unrestricted use during a period of radioactive decay. ,
The definition of decommissioning as well as the definitions of the alter-
)
natives contained'in the Supplementary Inforication to the proposed rule !
/:
indicate that, if permanent cessation of nuclear activity occurs at the facility, the licensee is to propose to NRC the method that it intends to use in decommissioning the facility in a manner ultimately leading to '
)
i h
! 9 Enclosure A
the return of the site to an "unrestricted area" according to the defini-tion of 10 CFR 20.3 and the termination of the facility license. In determining whether a particular site is free from radiological hazards, the Commission will take a hard look at the extent to which the site has been previously used to dispose of low-level radioactive wastes by land burial and will decide what remedial measures, including removal of such ,
waste offsite, are appropriate before the site can be released for unrestricted use and the license terminated.
Sixcommentersindicatedthattheruleneededtoprovideclari/ica-tion as to what facilities are covered by the decommissioning rule. These commenters indicated that there appeared to be a discrepancy between the proposed S 50.2 which defined decommissioning as removing a facility "safely from *ervice and reducing residual radioactivity to a level that ,
gernits release of the property for unrestricted use and termination of license" and the Supplementary Information which indicates that decom-missioning means to remove "nuclear facilities" from service including "the site, buildings and contents, and equipment associated with any licensed NRC activity." Two commenters indicated that the rule should clarify that it does not apply to the nonradioactive portion of the facility.
In response to this comment, the definition of decommissioning in 5 50.2 clearly defines what is intended by this rulemaking, namely that decommissioning involves those activities necessary to remove a facility safely from service and to reduce residual radioactivity to a level that j
~
permits release of the property for unrestricted use and tennination of license. Section 50.82 indicates that a licensee must provide NRC with a plan indicating how these activities will be carried out and that this I
10 Enclosure A l
plan will be approved if it demonstrates that thm decommissioning will be performed in a safe manner. Section 50.82(f) indicates that the NRC will terminate the facility license if the terminal radiation survey demonstrates that residual radioactivity has been reduced such that the facility and site are suitable for release for unrestricted use. The definition of decommissioning in S 50.2 is general and its application in any given case will depend on specific circumstances.
The decommissioning rule applies to the site, buildings and contents, and equipment associated with a nuclear facility that are or become contaminated during the time the facility is licensed, and to activities related to the definition of "decommission" in the amended regulations.
The decommissioning rule will not apply to the disposal of nonradioactive structures and materials beyond that necessary to terminate the NRC license.
Disposal of nonradioactive hazardous waste not necessary for NRC license termination is not covered by these regulations but would be treated by other appropriate agencies having responsibility over these wastes.
- 2. Criteria used for choice of alternative. A number of commenters indicated that the rule does not contain sufficient criteria that a utility can use in choosing which decommissioning alternative should be used and that can be used in the review and evaluation of that choice. Some of these commenters pointed out that these criteria should factor in impor-tant considerations to be made in the choice, including clarifying what is sufficient benefit for delaying decommissioning, and that the choice of alternative be~ based on a detailed assessment demonstrating that the health and safety of the public is protected. These commenters indicated that better criteria on sufficient benefits should be included in the I
1 l
11 Enclosure A
[7590-01] ,
rule, specifically the degree of reduction in occupational radiation expo-sure, generation and disposal of waste, assurance that decommissioning will take place, radiation doses to the public, and quality of decommis-sioning operations. Other commenters mentioned that economic or other factors should also be included as being sufficient benefit, including comparative cost of~ alternatives, presence of other facilities at the site, development of new decommissioning techniques, and need to store wastes or spent fuel at the site. Some commenters indicated that it was not satisfactory to include criteria on acceptable alternatives in regu-latory guides as is proposed in the statement of considerations while other commenters indicated that it is.
In response, it should be noted that the intent of the rule is to provide the necessary guidelines with regard to use of decommissioning alternatives in a manner which protects the public health and safety.
Specifically, the rule includes requirements that, at the time of termi-nation of operations, licensees submit a decommissioning plan to the NRC which contains an indication of the decommissioning alternative to be used and a description of the activities involved and the controls and limits on procedures to protect occupational and public health and safety for that alternative. Discussion of how the decommissioning plan and the chosen alternative are evaluated 'in terms of protecting health and safety is contained below in Section B.2. j In addition, S 50.82 of the proposed rule stipulated that alter-natives which significantly delay completion of decommissioning, such as l use of a storage period, will be acceptable if sufficient benefit results.
This section of proposed rule has been modified in two ways. The first i
12 Enclosure A l
Gm'msy is to be more definitive in terms of acceptable decommissioning alterna-tives by permitting power reactors to use alternatives which provide for completion of decommissioning within 60 years. This is consistent with the technical data base developed as part of the rulemaking (Refs. 2 and
- 3) and with the conclusions of the Supplementary Information to the Pro-posed Rule. In the Supplementary Information, it was indicated that DECON or SAFSTOR for up to 50 years are reasonable options for decommissioning a light water power reactor. The reason for both of these alternatives being acceptable is that both have b'enefits and both are capable of being carried out in a manner which protects public health and safety. In selecting 60 years as an acceptable period of time for decommissioning of a nuclear power reactor, the Commission considered the amount of radio-active decay likely to occur during an approximate 50 year storage period and the number of months expected to be needed to dismantle the facility (Refs. 2 and 3). In addition to this change, the modified rule also states that consideration will be given to a decommissioning alternative which provides for completion of decommissioning beyond 60 years for power reactors only when necessary to protect public health and safety.
Factors, set out in the modified rule, which would be considered in evaluating an alternative which provides for completion of decommis- j sioning beyond 60 years include unavailability of waste disposal ;
capacity and other site specific factors affecting capability to carry l l l 13 Enclosure A
[7590-011 ,
- out decommissioning safely, including presence of other nuclear facili-ties at the site. Section 50.82(b)(1) of the proposed rule has also been modified for nonpower reactors. Because of the variety of type of these reactors, specific criteria on time periods for completing decommission-ing, such as indicated above for power reactors, are not included for nonpower reactors. However, the proposed rule has been modified to pro-vide additional detail on the factors affecting acceptability of decom-missioning alternatives for nonpower reactors. These factors include considerations affecting waste disposal for the different alternatives and other site-specific factors affecting capability to carry out decommissioning operations safely, such as presence of other nuclear facilities at the site and reduction of occupational and public radiation exposures associated with the different alternatives. Other factors not related to protection of health and safety are not included in the consideration of alternatives in the modified rule. In addition, Regulatory Guide 1.86 will be revised to provide additional guidance on the decommissioning alternatives, specifically guidance on the factors affecting delay in completion of decommissioning. Use of the modified rule in conjunction with the regulatory guidance will provide for an expeditious licensing procedure. A licensee's proposed decommissioning alternative will be reviewed based on the criteria and guidance discussed here and in Section B.2 for acceptability in terms of completing decom-l missioning and protecting public health and safety.
I One commenter noted that neither the NRC nor the licensees can properly assess costs and benefits attributable to different alternatives due to the lack of sufficient information on occupational exposure. The commenter noted that NRC had no experience with decommissioning large, aged reactors and that, for example, the experience at the cleanup at TMI-2 had shown i 14 Enclosure A
1 1 l
the workers were being exposed to radiation levels six. times higher than expected. Thus, it is likely the decommissioning estimates of exposure are gross underestimates. In addition the commenter stated that there is much uncertainty with regard to radiation effects on human health.
Furthermore the commenter indicated that the Generic Environmental Impact Statement on Decommissioning (NUREG-0586) (Ref. 20), which provides a basis for this rulemaking, does not ad'equately address health and genetic effects. Hence the commenter noted it is difficult to assess the proper alternative and that, in any event, in making assessments NRC should use conservative estimates.
In responding to this comment it should be noted that NRC has had Battelle Pacific Northwest Laboratory (PNL) prepare detailed analyses of the technology, safety, and costs of decommissioning. These reports were prepared for a number of nuclear facilities and are listed in the Refer-ence section. The PNL reports contain estimates of expected occupational radiation exposures based on an analysis of work activities involved in decommissioning and radiation levels expected at the end of reactor life.
While it is true that no large, aged reactors have been decommis-stoned, the PNL reports represent a reasonable analysis of the occupa-tional dose which would be incurred at decommissioning. They provide sufficient information on which assessment of different alternatives can be made, specifically that DECON can be carried out while maintaining occupational exposures at reasonable levels while SAFSTOR and ENTOMB can result in reduction in occupational exposures. Thus, choice of the alternative can be made.
It should be noted that for any of the alternatives, occupational exposures will be limited by the requirements of 10 CFR Part 20 and that, 15 Enclosure A
[7590-01]-
- l in particular, licensees should maintain exposures to workers to as low J l
as reasonably achievable levels. Thus, radiation exposure to workers will l
be kept at acceptable levels for any of the alternatives used. The l health impacts of radiation and concerns over whether limits on exposure '
should be raised or lowered are outside the scope of this rulemaking and are the type of issues being addressed currently in a separate rulemaking that proposes to amend 10 CFR Part 20. The allowed occupational exposures during the decommissioning period will conform to the requirements of 10 CFR Part 20. The Generic Environmental Impact Statement (NUREG-0586)
(Ref. 20) analyzed the occupational exposures which would be received during decommissioning and found that over a 4 year decommissioning period they would be similar to that which would be experienced at an operating facility on a yearly basis. Thus, NRC determined that the health impact of decommissioning did not add significantly to the operating plant impact.
In summary, the information currently available provides NRC with a reasonable understanding of the safety aspects involved in decommission-ing and also provides sufficient information to evaluate alternatives.
As more information becomes available, NRC will factor it into the decision making process. It is not feasible to compare the increases in the estimates at TMI-2 to decommissioning since the THI-2 estimates were for a post-accident situation where there was significant contamina-tion and the situation was initially uncertain with regard to contamination levels and cleanup procedures. When licensees prepare their decomm'ission- !
ing plans for submittal to the NRC for approval under the requirements of l 10 CFR 50.82, they will have more information about the conditions in the ;
reactor and will provide more up to date information about occupational I l
i 16 Enclosure A I l
s w e osa -
exposures during decommissioning. At that time NRC will be able to evalu-ate the choice of decommissioning alternative for the specific facility.
- 3. DECON and SAFSTOR Decommissioning Alternatives. DECON and SAFSTOR are defined in the Supplementary Information of the proposed rule as follows: DECON is the alternative in which the equipment, structures, and portions of a facility and site containing radioactive contaminants are removed or decontaminated to a level that permits the property to be released for unrestricted use shortly after cessation of operations; SAFSTOR is the alternative in which the nuclear facility is placed and maintained in a condition that allows the nuclear facility to be safely stored and subsequently decontaminated (deferred decontamination) to levels that permit release for unrestricted use.
A number of commenters expr.essed opinions on the rule with regard to allowing use of DECON and SAFSTOR. Some commenters favored the use of DECON, one in particular noting that it should be used at a site of high potential for a seismic event. Other commenters noted the problems asso-ciated with DECON including the higher occupational exposure involved and problems associated with inability to dispose of wastes. Some commenters noted that site specific factors should come into play and that either DECON or SAFSTOR should be possible. Some commenters noted that because of problems associated with DECON, that SAFSTOR was the best option.
Two commenters expressed the opinion that the rule seems to favor use of I
DECON for reactors.
The NRC is aware of and has considered the issues related to the advantages and disadvantages of the DECON and SAFSTOR options. The studies done for NRC by Battelle Pacific Northwest Laboratory (PNL) con-sidered factors such as cost of the alternative and occupational exposure 17 Enclosure A
[7590-01] ,
and waste volumes associated with each alternative. The PNL studies also considered the effects on decommissioning of interim inability to dispose of wastes offsite. The Generic Environmental Impact Statement on Decommissioning Nuclear Facilities (NUREG-0586) (Ref. 20) prepared by NRC also addressed the advantages and disadvantages of DECON versus SAFSTOR including the fact that DECON releases the site for unrestricted use in a much shorter time period than SAFSTOR, whereas use of SAFSTOR would l l
reduce occupational exposures and waste volumes. Both of these alter- !
natives satisfy the definition of decommissioning in S 50.2. Based on the documents indicated above and on the discussion in the Supplementary Information to the proposed rule, the conclusion of the Supplementary Information regarding these two alternatives is that DECON or 30- to 50 year SAFSTOR are reasonable options for decommissioning light water 1
power reactors. As indicated in Section A.2, the proposed rule has been modified to permit use of DECON or SAFSTOR for up to 60 years as long as it is demonstrated that they will be performed in a manner which protects public health and safety. Use of the 60 year time period in the modified rule is not intended to mean that if DECON is selected that it would be acceptable for it to last that long; periods of 5-10 years would be more reasonable for DECON. I With regard to SAFSTOR, six commenters stated that the rule should contain requirements that if the SAFSTOR alternative is chosen, reactor decommissioning be completed following storage periods of a maximum of 30-50 years because after this time period there will be little benefit in dose or waste volume reduction. In contrast, four commenters stated that even a 100 year perion m too restrictive because periods of over 100 years are allowed in waste disposal facilities. Four commenters 18 Enclosure A
- l indicated that the rule should provide criteria by which the appropriate '
length of time for the storage period of SAFSTOR can be determined, balancing site-specific costs and benefits.
The Commission does not believe it necessary for the rule to contain an absolute time limit on how long SAFSTOR can last. Instead, as noted in Section A.2, modified 9 50.82(b) indicates that a power reactor licen-
~
see's decommissioning plan must indicate a choice of decommissioning alternative, that DECON or 60 year SAFSTOR is acceptable, and that con-sideration will be given to alternative methods for decommissioning which provide for completion of decommissioning beyond 60 years when necessary to protect public health and safety. Factors considered in evaluating an alternative which provides for completion of decommissioning beyond 60 years include lack of waste disposal capacity or other factors affect-ing safety, including presence of other nuclear facilities on the site.
The rule does not contain a specific limitation on the length of time for SAFSTOR beyond the time period indicated in the modified rule.
The case-by-case considerations, such as shortage of radioactive waste disposal space offsite or presence of an adjacent reactor whose safety might be affected by dismantlement procedures, or other similar site specific considerations, mean that the appropriate delay for a specific facility must be based on factors unique to that facility and could result in extension of completion of decommissioning beyond 60 years.
Based on this, the NRC considers the setting of an absolute time limit on i SAFSTOR to be impractical and unnec'essary. In addition, the expected I l
revisions to Regulatory Guide 1.86 setting out guidance on the factors l discussed above will provide the NRC the flexibility to consider specific cases while still providing assurance that the health and safety of the l public is protected. ,
19 Enclosure A
)
[7590-01] ,
Although the final rule does not contain specific restrictions on the time period involved for delay in completion of decommissioning, the Supplementary Information to the proposed rule does indicate that this period should be on the order of 100 years because this is considered a reasonable time period for reliance on institutional control. Although commenters refer to longer periods of storage for waste disposal facili-ties there are some differences between these two situations which must be considered, including the fact that in the case of the waste disposal facility the NRC transfers the license for the facility to the State or Federal government agency that owns the disposal site following satisfac-tory site closure whereas the reactor facility would remain licensed by a private organization, and that there are only a small number of disposal facilities compared to possibly over 100 reactor facilities.
- 4. The ENTOMB Alternative. ENTOMB was defined in the Supplementary Information to the proposed rule as the alternative in which radioactive contaminants are encased in a structurally long-lived material, such as concrete; the entombed structure is appropriately maintained and continued surveillance is carried out until the radioactivity decays to a level permitting unrestricted release of the property.
A number of commenters indicated that the rule should expressly pro-hibit the use of ENTOMB as a decommissioning alternative for reactors.
Several reasons were advanced for this statement including the following:
the ENTOMB alternative could cause environmental damage due to the pre-sence of long-lived radionuclides which would be radioactive beyond the life of any concrete structure; the Supplementary Information to the pro-I posed rule indicates ENTOMB is not viable yet the rule does not explicitly i
prohibit it; ENTOMB is inconsistent with the definition of decommissioning 1
20 Enclosure A
~
sve w =mr requiring release for unrestricted use; and sore reactors are located in highly populous areas. In contrast several commenters stated that the ENTOMB alternative should be left as a possible option and that in addi-tion the 100 year period discussed in the Supplementary Information as the time period in which ENTOMB should be completed was too restrictive.
Some~commenters indicated that ENTOMB had certain advantages including reduced occupational exposure and waste volumes while some noted that no options should be precluded at this time due to the developing nature of decommissioning technology.
It is the Commission's belief that the ENTOMB alternative for decom-missioning should not be specifically precluded in the rule because there may be instances in which it would be an allowable alternative in protecting public health and safety' and common defense and security. By not prohibiting ENTOMB, the rule is more flexible in enabling NRC to deal with these instances. These instances might include smaller reactor facilities, reactors which do not run to the end of their lifetimes, or other situations where long-lived isotopes do not build up to significant levels or where there other site. specific factors affecting the safe decommissioning of the facility, as for example, presence of other nuclear facilities at the site for extended periods. In addition there is potential for variations on the ENTOMB option where, for example, some decontamination has already been performed, thereby making the ENTOMB option more viable. Analysis of the ENTOMB alternative in the PNL reports (Refs. 2, 3) and in the GEIS (Ref. 20) indicates that it can be carried out safely and that it can have some benefit in the reduction of occupational exposure and waste requiring disposal.
1 21 Enclosure A !
1
[7590-01]
As noted above, concerns were expressed by the commenters that the ENTOMB option would cause environmental damage due to the presence of long-lived radionuclides which would be radioactive beyond the life of any concrete structure, that it is inconsistent with the definition of decommissioning requiring unrestricted release, and that some reactors are located in highly populous areas. In addition, the Supplementary Information to the proposed rule indicated, in general, that there may be difficulties with the use of ENTOMB, in particular in demonstrating that the radioactivity in the entombed structure had decayed to levels permitting unrestricted release of the property in a period on the order l
of 100 years. In response, the rule contains requirements that a licensee must submit an alternative for decommissioning to the NRC for ,
approval and that consideration will be given to an alternative which provides for completion of decommissioning beyond 60 years only when ,
i necessary to protect health and safety. This provides the Commission with both sufficient leverage and flexibility to ensure that if the ENTOMB option is chosen by the licensee it will only be used in situa-tions where it is reasonable and consistent with the definition of decommissioning which requires that decommissioning lead to unrestricted I
release. As indicated above, analysis of ENTOMB indicates that it can be l carried out safely and with minimal environmental effect for the time periods presented in this Supplementary Information and in the guidance under preparation. However, based on the difficulties with ENTOMB described in the Supplementary Information to the proposed rule and by the commenters, use of ENTOMB by a licensee would be carefully evaluated by NRC according to the requirements of the rule before its use is 22 Enclosure A
pe rmitt:d. Regulatory Guidas currently in preparation will provida more
! guidance in this area.
~
B. Planning for Decommissioning. Comments received on the subject I
of decommissioning planning covered several areas. These included the licensing scheme for the decommissioning process; the criteria for con-ducting and evaluating decommissioning plans and activities and license termination; accupational exposure, safeguards, and quality assurance during decommissioning; recordkeeping and facilitation; and the effect of the rule on shutdown reactors.
- 1. Licensing scheme for decommissioning. Several commenters found the proposed rule vague in the areas of what type of license is in effect during reactor decommissioning, how Part 70 applies to reactors during decommissioning, when the license terminates, procedural criteria for the termination process, and the restrictions and requirements that apply to a "possession-only license," One commenter indicated that there might be loopholes which would be exploited by the industry resulting in adverse ,
impacts to the public and the environment and another commenter indicated that explicit procedural criteria would remove a needless burden on appli-cants and result in a more cost and time effective licensing process.
In response, it should be noted that application for termination of license occurs at the time of initiation of decommissioning which may be many years before actual termination of license is granted, that decom-missioning is carried out under an amended license in accordance with the terms of a decommissioning order, and that the license is terminated 23 Enclosure A
_ _ . . . _.,_._______.__..m. , , _ _ . . . . ..- ,,_.. ,.-
[7590-01) .
only after the Commission is satisfied that decommissioning has been pro-perly completed. Normally, an amended Part 50 license authorizing posses-sion only will be issued prior to the decommissioning order to. confirm the nonoperating status of the plant and to reduce some requirements which are important only for operation prior to finalization of decommissioning plans. The authority to possess radioactive materials under Parts 30, 40, and/or 70, as appropriate, continues to be incorporated in the modi-fied Part 50 license, as it is during operation. Subsequent license amendments will be issued as appropriate. The Commission will follow its customary procedures, set out in 10 CFR Part 2 of the NRC Rules of Prac-tice, in amending Part 50 licenses to implement the decommissioning pro-cess. In the past, the period of safe storage or that following entomb-ment has been covered by an amended "possession-only" Part 50 license which does not authorize facility operation, with the term "ordar" used only in the case of a ditmantling order, due to the more active nature of this stage of decommissioning. Except for the use of the term "decommis-sioning order," there has been no change from past practice. The term "decommissioning order" is used in lieu of the term "dismantling order" because, according to the amendments, the overall approach to decommis-sioning must now be approved shortly after the end of operation rather than an amended "possession anly" Part 50 license being issued without plans for ultimate disposition.
As with any license, the authority to operate or to carry on licensed activities ceases at the expiration date unless the license is being renewed. However, the license and the responsibility to protect health and safety and promote the common defense and security continues until the Commission terminates the license. Section 50.82(f) clearly indicates 24 Enclosure A
the license is terminated by a determ1 nation of the Commission after the decommissioning has been performed and it has been adequately demonstrated that the facility and site are suitable for release for unrestricted use.
Because decommissioning, including any change from the original operat-ing license, requires Commission approval, there are no "loopholes" which would allow adverse impacts to the public or environment.
For clarification, it is noted that the term "decommissioning plan" refers to the plan submitted at the time the licensee decides to terminate the license, while the term "decommissioning funding plan" refers to plan submitted early in facility life which indicates the licensee's financial assurance provisions.
- 2. Criteria for decommissioning activities and license termination.
Many commenters were concerned with the lack of specific requirements applicable to the process of decommissioning, particularly in the case of reactors, and suggested that strong guidelines on requirements for conducting and evaluating decommissioning plans and activities and termi-nating licenses are necessary to protect public, occupational, and envir-onmental safety. Some suggest that the rule establish certain safety criteria and the ways in which the utility will meet these criteria. A few commenters were specifically concerned with clarifying requirements during the "safe storage" period, such as those for security, inspection, reporting, and monitoring. Many were not clear as to whether the sug-gested "guidance" should be in the rule or if Regulatory Guides would be considered appropriate. Two commenters indicated that without more specific criteria for acceptability of decommissioning plans, the Commission would exercise little authority over licensee actions during decommissioning and one commenter indicated that the licensees could 25 Enclosure A l
[7590-01) l l
conduct decommissioning with "virtually complete independence." Two
{
l commenters indicated that the rule "assumed" that utilities would follow '
basic safety criteria.
In response, it should be noted that continuing authority to possess a reactor in a decommissioned status is governed by the provisions in 10 CFR Part 50 governing operating licenses, as appropriate. As discussed earlier, it is the intent of the rule to provide the necessary guidelines to assure that decommissioning is carried out in a manner which protects the public health and safety. To this end, the rule contains requirements that a decommissioning plan contain a description of the following: the choice of the alternative for decommissioning and the activities involved; the controls and limits on procedures and equipment to protect occupational and public health and safety; a description of the planned final radia-tion survey; quality assurance and safeguards provisions, if appropriate; and a plan for assuring the availability of funds for decommissioning.
Based on this requirement the licensee submits the necessary information to the NRC in the decommissicning plan. The NRC's evaluation of the information contained in this plan and the licensee's subsequent conduct of decommissioning activities is based on existing regulations applicable to reactors and other facilities undergoing decommissioning. These regulations include 10 CFR Parts'20, 50, 61, 70, 71, and 73.
Part 20 contains the basic standards for protection against radiation l
and is applicable to all licensees during operation as well as decommis- J sioning, including the storage period. Part 20 contains requirements for limits on both occupational and public exposure, including limits on radiation exposure and concentrations of radioactive material in both l
26 Enclosure A
restricted and unrestricted areas. In addition to the general limita-tions on exposure contained in Part 20, 10 CFR 20.1(c) indicates that radiation exposures, and releases of radioactive materials in effluents to unrestricted areas, should be as low as reasonably achievable (ALARA).
Part 20 also contains, among other things, requirements on radiation monitoring, personnel monitoring, precautionary procedures, and reporting.
Part 50, Appendix B contains broad requirements on quality assurance provisions which can be used, as appropriate, to the extent commensurate with the safety functions to be performed by facility structures, systems, and components during decommissioning activities. Part 50 also contains guidelines on radioactive waste system design. Part 61 contains require-ments on land disposal of radioactive waste including criteria for classi-fication and characteristics of waste acceptable for disposal. Part 71 contains requirements for the packaging and transportation of radioactive material. Parts 70 and 73 contain requirements for physical protection of plants and materials. Although all of these parts do not specifically mention decommissioning activities, the criteria of these parts would apply, as appropriate, to decommissioning. In addition, regulatory guides, many of which already exist and some of which are under considera-tion, can provide additional guidance for planning and conducting decom-missioning in accordance with the applicable regulations. For example, Regulatory Guide 8.8 provides guidance on ensuring that occupational 1
exposures are ALARA and Regulatory Guide 1.143 provides guidance on radio- !
active waste treatment systems. l Also, as noted below in Sections B.4 and '
B.5, guidance is being considered on safeguards and on quality assurance provisions during decommissioning and on procedures to be considered for I
27 / Enclosure A !
l
[7590-01] ,
facilitating decommissioning by reducing radiation dose based on NUREG/
CR-3587 (Ref. 25).
The primary means of protecting the heatch and safety of the public and workers during decommissioning is through implementation of the decommissioning plan. The decommissioning plan would contain the licensee's means for complying with parts of the regulations discussed above which are applicable to non-operating facilities.
All amendments to the operating license which the licensee holds at the time the decommissioning plan is submitted are subject to Commission approval. Amendments to the license are needed because many of the pres-criptive requirements of an operating license are for the purpose of assuring safe operation and are no longer necessary during decommission-ing. The decommissioning plan and the associated approval process provide an adequate legal framework for the regulation of facilities undergoing decommissioning. Therefore, the licensee would not have independence in conducting decommissioning. The Commission does not merely assume the L utilities will follow basic safety criteria. The licensing offices will review decommissioning plans based on the applicable criteria and guidance and the inspection and enforcement staff will monitor the carrying out of the plans. This approach should provide enough flexibility to accommodate the varied nature of activities which are possible.
The proposed rule has been modified to provide some additional l detail on the scope of decommissioning plans in the finsi rule. A pro- l posed regulatory guide on contents of decommissioning plans for materials !
facilities has been published; a similar Regulatory Guide for reactors is being developed to provide guidance on the information which should be i
submitted to conform to the rule. In addition, Regulatory Guide 1.86 28 Enclosure A 1
svw r *nn i ' .*
i .
provides guidance on conducting decommissioning activities, including storage periods, in a manner to meet applicable requirements. This Regulatory Guide is currently being revised to be fully consistent with the regulations. Regulatory Guides have been used successfully to provide uniform application of requirements while affording Commission staff flexibility to consider unique factors in any situation. In addi-tion, the staff would use standard review plans (SRPs) which contain review procedures and the acceptance criteria used in evaluating licensee applications, including decommissioning plans. These SRPs would be available and contain the bases for the acceptance criteria.
One commenter noted that it was unclear what activities should not be started prior to approval of decommissioning plans. Other commenters requested that the regulations be clarified in order to delineate those activities related to decommissioning that could proceed without approval of the decommissioning plan if those activities are allowed by the oper--
ating license and S 50.59.
In response it should be noted that S 50.59 permits a holder of an operating license to carry out certain activities without prior Commission approval unless these activities involve a change in the technical specifications or an unreviewed safety question. However, when there is a change in the technical specifications or an unreviewed safety ques-tion, S 50.59 requires the holder of an operating license to submit an application for amendment to the license pursuant to S 50.90. Section ,
50.59(a)(2) contains criteria as to what is deemed to be an unreviewed l safety issue. The amendments contained in this rulemaking do not alter a licensee's capability to conduct activities under S 50.59. Although the
. I 29 Enclosure A 1
[7590-01] ,
Commission must approve the d'ecomissioning alternative and major struc-tural changes to radioactive components of the facility or other major changes, the licensee may proceed with some activities such as decontami-nation, minor component disassembly, and shipment and storage of spent fuel if these activities are permitted by the operating license and/or 6 50.59. These matters will be further discussed in a revision to Regulatory Guide 1.86 under consideration.
- 3. Occupational exposure during decomissioning. Many comenters emphasized the importance of worker protection. Many of these suggested more specific criteria to minimize worker exposure. A number were con-cerned that the rule did not specifically address radiation monitoring.
One felt that reporting of all phases to NRC should be required. One felt that strict enforcement of safety standards should be required, and also indicated that experience at TMI and Shippingport would indicate I
that total occupational exposures are apt to be substantially higher than 1 i
estimated. Another believed that exposures during decommissioning will be substantially higher than from operations. One comenter suggested specific requirements such as training of workers prior to work in highly radioactive areas.
In response, minimizing worker exposure during decommissioning is one of the main goals of this rul'emaking and of the guidance being devel-oped in connection with this rulemaking. Detailed plans for decommission-ing are the primary means of minimizing worker exposure. Procedures for carrying out decomissioning will be evaluated by NRC staff for adequacy of occupational exposure control; plans for appropriate training are an area of review. Basic radiation protection, monitoring, and reporting requirements need not be developed specifically for decommissioning 30 Enclosure A
.- )
because generally applicable criteria are already contained in 10 CFR Part 20. The radiation levels to which workers will be exposed will be similar to levels of major maintenance activities conducted during opera-tions. If total exposures prove to be higher than estimated, this could be factored into decisions concerning alternatives and approaches in the future. Also contributing to the minimization of worker exposure are the recordkeeping requirements of this rule. Other aspects of facilitation of decommissioning will be considered in the review of license applications.
- 4. Safeguards during decommissioning. A commenter pointed out that the applicability of safeguards requirements to decommissioning is unclear.
In response, as noted above in Section B.2, the existing regulations on safeguards for nuclear facilities are considered to contain criteria appli-cable to the decommissioning process. Therefore it is not considered necessary to amend those regulations. However, the Commission has modified the proposed rule to indicate that safeguards provisions during decommis-sioning are to be described, as appropriate, in the decommissioning plan.
In addition, appropriate guidance documents will be issued identifying which of the current operating requirements on safeguards are to apply during decommissioning.
- 5. Quality assurance during decommissioning. Many commenters were concerned that the proposed regulation did not include mention of quality assurance and/or quality control for decommissioning. Some of these indicated that QA/QC requirements need to be clearly specified. A few comments indicated the need for a separate or independent QA/QC staff.
i Two commenters suggestad some specific procedures which should be subject i to Q/A and two others refer to problems with decontamination activities at Saxton because of lack of QA.
31 Enclosure A 1
I
[7590-01] .,
The Commission agrees that quality assurance is important for decom-missioning. The intent to include QA in decommissioning plans was men-tioned in the statement of considerations of the proposed rule, but the scope of plans in the regulation itself was very general. The final rule indicates that QA provisions during decommissioning are to be described, as appropriate, in the decommissioning, plan. A large part of the QA program for operating reactors pertains to equipment and procedures neces-sary for the safe operation of the plant; the equipment and procedures requiring QA procedures during decomissioning is much more limited. It is not considered necessary to detail these requirements in the regula-tions because of the limited nature of the QA requirements. As noted above in Section B.2, information in the decommissioning plan would describe QA provisions as they comply with 10 CFR 50, Appendix B to the ext'ent commen-surate with the safety functions to be performed by facility structures, systems and components during decommissioning activities. Guidance is being considered to assist in the development and review of the quality assurance provisions of decommissioning plans.
- 6. Recordkeeping and facilitation. Commenter opinions concerning the recordkeeping requirements proposed was mixed. Several thought it was important enough to include specific support for the requirements as proposed indicating why such records were important. Other commenters indicated that existing recordkeeping requirements are sufficient. One commenter suggested that records might be limited to those events result-ing in the spread of contamination outside of radiologically controlled t areas identified in the updated FSAR.
The Commission is retaining recordkeeping requirements for decom-
)
missioning. Experience has shown that incomplete knowledge of facility 32 Enclosure A
design and history can result in significant difficulties and greatly underestimated costs at the time of decommissioning. Although many of the records, particularly in the case of reactors, would be kept for other purposes, it is expected that an improvement in assurance of avail-ability of the records wi'il resu?+. from the amendments. The amendments have been written to minimize the additional effort required, that is, requiring only centralized reference to pertinent records and their loca-tion rather than duplication of the records and, if drawings are refer-enced, not requiring that each relevant document be indexed individually.
Some comments were submitted concerning facilitation of decommission-ing. The commenters favored consideration of facilitation except for one who indicated that additional plant design requirements and operating procedures to facilitate decommissioning are not necessary. One commenter l discussed how design facilitation and improvements in the technology of decommissioning (such as robots and remote devices) can reduce the costs, time, and exposures of decommissioning. Other commenters recommended that specific requirements for facilitation of decommissioning in design and operating procedures be included in the regulations.
In preparing the proposed rule, the Commission did not conclude that additional plant design requirements and operating procedures to facilitate decommissioning are unnecessary but rather that, other than recordkeeping, no specific design feature nor operating procedure need be required specifically for all licensees at this time. As noted in the Supplementary Information to the proposed rule, although no specific' requirements are being imposed at this time, the effects of facilitation on design of facilities and operational procedures can be considered under 33 Enclosure A
[7590-01]
general criteria contained in existing regulations in 10 CFR Parts 20, 30, 40, 50, 70 and 72. To the extent that design features or operational techniques are of known value in facilitating decommissioning, the Commission staff may consider these factors in reviewing applications for construction permits or operating licenses under the more general criteria contained in the regulations. The Commission has done some preliminary studies to identify possible beneficial features and tech-niques (NUREG/CR-3587, Reference 25).
- 7. Shutdown reactors. A number of commenters were concerned about the exemption of reactors permanently shut down prior to issuance of the rule from the requirement to submit decommissioning plans. Some thought that this would mean a lower level of protection for the public living near such a plant. One commenter suggested that those licensees be required to review their plans within a set time after the effective date of the rule and submit any revisions necessary to make their plans f consistent with the new regulations and two commenters suggested an exemption procedure in the regulations would be better than a blanket exemption.
In response to this comment, it should be noted that reactors which ,
are permanently shut down prior to the effective date of this rule, have had their status reviewed by applying for a possession-only license (a few had obtained a materials license only). These plants are being ade- l quately controlled under their modified license and license conditions to protect the health and safety of the public while in this decommis-sioning mode. Any further delay in completion of decommissioning would have to be considered formally if an extension is requested beyond the expiration of the possession-only license. Detailed plans for ultimate 34 Enclosure A
. Ens
- Mms 21 dismantlement of reactors currently in safe storage would be deferred under the provisions of this rule. Requiring a decommissioning plan for these reactors at this time, or an application for exemption, would involve administrative efforts on the part of these licensees with no significant impact on health and safety. Funding and recordkeeping requirements in the amendments apply to these reactors since they possess an "operating license," albeit modified. Details concerning financial assurance, primarily the time period for accumulating funds not set aside during operation, would be decided on a case-by-case basis.
C. Financial Assurance. Comments received on the issue of assur-ing the availability of funds for decommissioning included questions regarding costs of decommissioning, use of certification of a specified amount and funding plans for reactors, acceptable funding methods, sub-mittal of funding plans, specific comments on funding for material licensees, funding for Federal licensees, and general questions concern-ing need for funding requirements and relationship of the rule to the functions of other regulatory agencies. '
i
- 1. Cost of decommissioning. A number of commenters questioned j the Battelle Pacific Northwest Laboratory (PNL) estimates of the cost ,
of decommissioning as discussed in the Supplementary Information to the '
proposed rule. A variety of alternative estimates and reasons for questioning the estimates were given. A summary of these are as follows:
i (a) Commenters indicated that other estimates have been made which l make the PNL studies appear to be too low. Commenters from the nuclear .
l industry indicated costs are more likely in the range of $126 to $178 i
l l 35 Enclosure A i
[7590-01]
million. Other commenters cited estimates which range from $600 million to as high as $3 billion. The variety of estimates are cited by some commenters as being indicative of the uncertainty of estimates. One commenter indicated that the estimates in the PNL studies were high.
(b) The data base of tha PNL reports is limited because the reports are based on small research reactors and on the Elk River reactor. In particular, Elk River and Saxton operated at low power loads and for only a very short time, not long enough for long-lived radionuclides to build up. Thus, necessary experience to make accurate cost estimates does not exist and commenters quote the PNL reports as stating that "extrapolations from these experiences to large commercial reactors are considered to be generally unreasonable." Moreover commenters stated that the PNL studies are outdated. Some commenters point out that certain necessary data for estimatirg costs does not exist. These data include information on con-crete contamination, activated vessel components and biological shield and soil contamination and uncertain status of requirements regarding occupational dose, waste disposal, and residual radioactivity.
(c) Shippingport, a 65 MWe reactor, has been estimated to cost $90 million to decommission. Larger reactors would likely cost significantly more than this, perhaps more than three times as much. In addition, Shippingport cost estimates are probably lower than typical because the reactor vessel will be removed intact and the wastes will be disposed of in a Federal Repository. Other estimates at Saxton and Humboldt Bay (which the commenter indicated as being $600 million in 2015 dollars) indicate PNL estimates are too low.
36 Enclosure A
()S90-01)
(d) Estimates of costs of other activities such as reactor construc-tion, THI-2 cleanup, and Saxton decommissioning have been greatly under-estimated. Costs of decommissioning will likely escalate much higher than estimated today.
(e) The cost of decommissioning a reactor will likely equal the cost of construction of the plant.
The following is a discussion of the response to these concerns.
NRC, as part of its efforts on rulemaking for decommissioning, con-tracted with Battelle Pacific Northwest Labs (PNL) to develop an analysis of estimated costs of decommissioning various nuclear facilities, includ-ing PWRs and BWRs, on a generic basis, based on an engineering evaluation of activities involved in decommissioning. As indicated above, certain of the commenters disputed the accuracy of the PNL studies to varying degrees. '
The PNL reports on decommissioning a reference PWR and reference BWR are detailed engineering studies of the conceptual decommissioning of a large PWR (the 1175 MWe Trojan Nuclear Plant is used as the reference i plant) and a large BWR (the 1150 MWe WNP-2 plant is used as reference).
The PhL reports consider: (1) the detailed plant design and layout of the reference plant; (2) estimated conditions in the plant at the time of shutdown (just prior to decommissioning) including estimates of radio-nuclide inventory and radiation dose rates; (3) techniques for decontam-ination and dismantling which are current and proven; and (4) radiation protection requirements for workers and the public. Based on these con-siderations, the PNL reports present detailed work plans and time schedules to accomplish decommissioning, including those for planning and preparation, decontamination, and component disassembly and transport.
37 Enclosure A
[7590-01] .,
In making cost estimates of decommissioning, the PNL reports include work scheduling estimates, staffing requirements, specialty contractors, essen-tial systems, radioactive materials disposal, supplies, etc.
The PNL reactor decommissioning studies were performed during the period 1976-1979 and PNL has since prepared updates of the original PWR and BWR studies (NUREG/CR-0130 (Ref. 2) and NUREG/CR-0672 (Ref. 3),
respectively) in which the earlier estimates were a6 Justed for inflation due to increases in labor costs, waste disposal charges, and other general cost increases since the original studies. In addition to inflation, several aspects not considered in the original studies were examined:
the use of a general decommissioning contractor in place of the utility acting as its own contractor; the u;e of an external engineering firm to develop the detailed plans and procedures for accomplishing decommission-I ing; and the addition of sufficient staff to assure that radiation dnses to decommissioning workers do not exceed 5 rem per year.
Based on the above factors and adjustments PNL estimates of power reactor decommissioning in January 1986 dollars are in the range of
$105 - $135 million. A breakdown of these costs is contained in the i
Final Generic Environmental Impact Statement on Decommissioning Nuclear l l
Facilities (Ref. 20). The PNL costs do not include the cost of demoli- l tion and removal of noncontaminated structures, storage and shipment of spent fuel, or restoration of the site.
Although it may be difficult to make simple comparisons between different cost estimates for different plants because of site-specific considerations, it can be said that the PNL estimates represent a reason-able approximation of the range of decommissioning costs, in particular because they use engineering assumptions and are based on decommissioning
- 38 Enclosure A
vaapum i
experiance. Other estimates made independently from PNL and made using '
engineering assumptions are in the same general cost range as PNL.
Estimates in the range of $600 million to $3 billion appear to be unreasonably high. The $600 million figure is for decommissioning Humboldt Bay and is in year 2015 dollars and hence includes the assumed effects of price escalation between 1984 and 2015 which could be sub-stantial. No specific bases or data are presented by the commenter to justify the $3 billion figure. It may be based on comparisons of construction and decommissioning costs. However, this is not necessarily a valid comparison as discussed below.
Explanation of differences between the PNL cost est. .te range and that cited by the nuclear industry of $126 to $176 million rests partly with site-specific differences and partly with differing assumptions regarding labor necessary to complete certain decommissioning tasks and differing assumptions regarding waste disposal volumes and charges.
These different assumptions come about based partially on the uncertainty inherent in making these cost estimates at this time. Further analysis in revisions to the estimates .to account for recent technical information obtained since the original PNL studies were prepared may well reduck th?
differences in the assumptions ano estimates. For example, the NRC has research programs underway to obtain data from the decommissioning of the Shippingport reactor. The rule amendments provide for these differences by allowing the use of site-specific cost estimates in financial assurance provisions.
The commenters in (b) above questioned the PNL data base because it used small reactors as a basis. As discussed below, the primary use of l information from earlier decommissionings of small reactors like Elk j i
39 Enclosure A
[7590-01] .
i River was to gain a perspective on the types of operations necessary and the types of tooling appropriate to accomplish dismantlement.
The fact that the activation levels experienced in Elk River were lower than those anticipated in a reactor after a full lifetime of opera-tion has little effect on the PNL analyses, because components that are highly activated are generally disassembled under water. With water shielding, still higher activation levels will not influence the approach and methods of disassembly and packaging in any significant way.
With respect to the lack of data on contamination and activation levels throughout the plants at the end of life, the activation levels were calculated using well proven methods and the contamination levels '
were based on data from actual operating plants after 3 to 6 years of operation. These values are not unreasonable estimates of end-of-life conditions because current operating practice is to perform system and surface decontaminations periodically as required to keep occupational radiation doses to operations personnel within reasonable bounds.
The quotation from the PNL report to the effect that "extrapolations of these experiences to large commercial reactors are considered to be unreasonable" needs to consider the remainder of the discussion contained in the PNL report for the proper context. The statement in the PNL report was not intended to imply that reasonable analyses could not be made for the large reactors. The statement was intended instead to discourage persons from performing linear extrapolations of the Elk River decommis-sioning costs to a large powe. reactor by using the ratio of their power levels. In fact, the PNL studies go on to state in Section 4.3 of NUREG/CR-0672 that "the primary value of past decommissioning experience is in identification of the methods and technologies of decommissioning."
L 40 Enclosure A
m- ]
+o l In S:ction 4.3.3, NUREG/CR-0672 describe; some of the lessons learned from past decommissionings, including the fact that "Past decommissionings have demonstrated some of the aspects of the practicality and acceptabil-ity of the various decommissioning approaches. The necessary technology not only exists, but has been safely and successfully applied numerous times to a wide variety of nuclear installations." As can be seen in AppendixGofNUREG/CR-0672,informationontechniquesandmethodsfrom earlier decommissionings, gathered from various sources, is used in considering which techniques are applicable to larger facilities. Some examples are decontamination, physical cleaning, removal cf structural material, and equipment disassembly. Thus, as discussed in NUREG/CR-0672, direct extrapolation or comparison of decommissioning the small facilities is not used by PNL in evaluating costs of decommissioning for the larger reference facilities, but rather the usefulness of the earlier decommis-sionings is in their demonstration of available and successful decommis-sioning methods and techniques to accomplish specific tasks.
PNL utilizes this information, where applicable to large reactors, and also considers the design ano plant layout of the large reactors, and the estimated conditions in the reactor at the time of shutdown, including estimates of radionuclide inventory and radiation dose rates, as well as decontamination techniques and radiation protection measures more appro-priate for large reactors. Based on these considerations, the PNL studies developed detailed work plans and time schedules to accomplish decommis-sioning which are described in more detail in Sections 4.2 and 9 and Appendices F and G of NUREG/CR-0130 and Sections 3 and 9 and Appendices G, H, and I of NUREG/CR-0672.
4 45 Enclosure A
'~
(7590-01] .
The commenters in (c) questioned the PNL estimates due to the costs of the Shippingport decommissioning. In response, first, it should be noted that the Shippingport reactor has all of the components of a large commercial reactor and, in addition, the ratio of the physical size of components at Shippingport compared to the physical size of components at a large commercial reactor is much larger than the ratio of power levels. Thus, the kinds and numbers of operations required to accomplish dismantlement are very similar. The cost of assembling and paying a crew for the decommissioning is high and makes up a large fraction of the cost of decommissioning. Even for smaller facilities, a crew must still be ,
assembled and must perform a number of tasks similar to those in large reactors such as decontamination of piping loops, decontamination of con-crete surfaces, vessel and pipe cutting, etc. The costs of staff labor for these activities is significant in each case.
Second, the specific situation at Shippingport must be considered.
In particular, the Shippingport dismantlement is being conducted as a learning exercise and an information/ technology transfer opportunity for the nuclear industry, More time and effort are being devoted to planning, I executing, and documenting each task than would otherwise be necessary during a commercial reactor decommissioning project. Thus, the costs should be greater than expected for a plant of that size. In addition, the Shippingport cost estimate is escalated to real dollars spent during the active decommissioning period up to 1990 which is a reasonable estima-tion method because 00E needs to project actual year dollar costs for budget purposes. However, this is different from the method used in the PHL estimates which was to use constant 1984 dollars in the proposed rule.
To make a valid comparison, both estimates would have to be in the same
, 42 Enclosure A
[7590-01]
year dollars. Inflation over this period may be an important factor.
Another factor in the difference in cost is that the Shippingport esti-mates include cost of demolition of certain facility structures and site restoration, which are not included in the PNL estimates. In addition to these factors, DOE indicated the existence of certain unique items in -
the Shippingport decommissioning including: the testing of certain decommissioning methods to determine if they fit particular applications; efforts involved to share technology with utilities; and efforts involved in considering the presence of the nearby operating Beaver Valley plants during decommissioning.
The commenters in (d) questioned the cost estimates due to aarlier underestimates of construction costs at nuclear plants and cleanup costs at THI-2. In response, while there is no doubt that decommissioning costs will continue to escalate in step with general price increases, it does not follow that because reactor construction costs exceeded original estimates, decommissioning cost estimates will also be greatly exceeded.
Cost overruns in the construction of nuclear plants reflected the regulatory requirements necessary to license a reactor for construction and operation, the cost of interest to borrow money during protracted delays, and other site-specific problems rather than a basic inability to project the technological costs. Decommissioning cost estimates do not include a number of the factors involved in obtaining an operating license and should not necessarily be subject to such increases. The cleanup at THI-2 is a first-of-a-kind endeavor with potential for increased costs. The initial cost estimates were based on very limited knowledge of the actual conditions to be overcome, and in addition, there were delays in the program caused by technical and regulatory problems.
43 Enclosure A
[7590-01]., ,
The cost estimate for cleanup at TMI-2 has not increased appreciably since 1981 due in part to a better understanding of the work scope. The cleanup following an accident is not comparable to a normal decommissioning in terms of either technology or cost and the conditions for a reactor decommissioning can be much more sharply defined than could the condi-tions for THI-2 cleanup. Also, the activities needed to decommission are not first-of-a-kind, but reflect direct applications of developed tech-niques and equipment. Thus, cost increases of the magnitude experienced by the THI-2 cleanup effort are unlikely to occur for a normal decom-missioning effort.
The commenters in (e) indicated that the cost of decommissioning would likely equal the cost of construction of the plant, i.e., with costs of construction running at $3 billion, the cost of decommissioning would be $3 billion. First, there have been no detailed analyses pre-sented to indicate that decommissioning costs will equal construction costs and, in fact, there is not a specifically defined or fixed rela-tionship between these two costs. The PNL studies on decommissioning (NUREG/CR-0672 and NUREG/CR-0130) have not identified a specific rela-tionship between construction costs and decommissioning costs. As can be seen in Section 10 of NUREG/CR-0672, decommissioning costs depend on various specific factors such as costs of staff labor to accomplish decommissioning tasks, costs of disposal of waste, special tools and equipment, miscellaneous supplies, etc. Cost of construction includes several items which have little or no effect on decommissioning costs ;
such as licensing, extensive quality assurance procedures during construc-tion, site preparations, installation and testing of instrumentation, i i
control and electrical systems, the cost of interest on the money used 44 Enclosure A
! N l .'
during construction, etc. This discussion does not attempt to define or provide costs of these and other items, but to point out the differing nature of many of the construction costs versus decommissioning cost items, and why there was no identification of a defined relationship between them in the Battelle-PNL reports.
Secondly, in any comparison of costs it is necessary to place the costs in the same year's dollars in order to have a meaningful basis for comparison. Certainly in about 30-40 years when the reactors are decom-missioned, inflation may well drive the decommissioning costs towards the current cost of construction. However, the decommissioning rule amend-ments, which will require maintenance of funds by methods which keep pace with inflation and perio'dic adjustment of funds to account for effects of inflation, will provide assurance that funds are available to pay for decommissioning when needed.
- 2. Use of certification of a specified amount and funding plans for reactors. The proposed rule contained provisions that a utility applicant or licensee may submit a certification that financial assurance for decom-missioning will be provided in a prescribed amount stipulated in the regula-tions as $100 million (in 1984 dollars). The proposed rule also indicated that this value is to be adjusted annually using an inflation rate twice that indicated by the change in the Consumer Price Index. The following !
were comments received on this issue:
(a) A number of commenters objected to the use of certification for
{
the following general reasons:
(1) The use of site specific estimates is preferable to a prescribed amount because they will be more realistic and accurate and able to account for site-specific factors. l 45 Enclosure A
[7590-01) .,
4 (2) Commenters generally felt that because of the wide range of site specific cost estimates, any one value would not be accurate and not be representative of most plants and therefore the number of licensees using certification would be low. Most commenters argued that $100 million was too low while a few argued that it was too high.
(3) The use of a prescribed amount will not decrease utility efforts because they will still have to prepare site specific cost studies for the rate regulators regardless of the certification procedure. Commenters noted that the use of the $100 million figure or other similar prescribed amount will be viewed by state and Federal rate regulators as a limiting value, thus placing a burden on utilities to justify to the rate regula-tors an alternative funding level even if site specific studies show the prescribed amount to be inappropriate for that plant. Some commenters noted that this situation had already occurred in specific situations.
(4) The use of a specific prescribed amount as stated in the certi-fication was seen by some commenters as setting a revenue requirement which is a function for state and Federal rate regulators. -
4 (5) The inflation factor contained in the proposed rule was con-sidered to be inaccurate because there was no basis to expect the decom-missioning cost to increase at twice the CPI in the future, and the factor could be subject to misuse as noted above in (c).
, (b) Some commenters indicated that if certification is retained that it should be revised and clarified. The following suggestions were made
! i as to what should be done if certification is kept: I J
(1) The certification requirement should be clarified to indicate that it is not intended to and does not represent the actual cost of decom-i missioning, that it is not fixed but is for reference purposes only, that 46 Enclosure A 4
,- , ---m-- -
[7590-01) it is only intended to insure minimum financial responsibility and that it is not intended to bind regulatory ratemaking bodies to that figure either as a minimum or maximum.
(2) The amount should be increased to the $120 to $170 million range so that it is sufficiently high to include realistic decommissioning costs.
(3) Indicate that, despite the allowance of certification, use of a site specific study is preferable and should be used if available. Only allow use of certification in certain cases when it can be shown that costs are less than $100 million.
(4) There should be consideration given to including means to adjust the certification numbers to account for such things as plant size, design, other site specific factors, BWR vs PWR, pre- or post-THI units, decommis-sioning alternative, two-unit site savings, etc.
(5) Clarification should be included as to what the $100 million includes, namely whether it covers both radioactive and nonradioactive structures, whether it includes contingencies, whether it is per unit.
(6) The use of the inflation factor should~be clarified, in partic-ular that it is not intended to reflect the actual rate of increase of decommissioning costs, and the inflation factor should be modified using other escalators, for example, Handy-Whitman indexes for labor and materials and separate data sources for waste disposal.
(c) With regard to funding plans, several commenters indicated that there needed to be more specific or quantitative description of NRC's criteria for approval of cost estimates in power reactor funding plans and that lack of criteria could result in confusion.
I In responding to these comments it should be noted that, as discussed in the Supplementary Information to the proposed rule, the intent of the 1
47 Enclosure A
[7590-01]. , ,
use of certification is to minimize the administrative effort of licensees and the Commission while still providing reasonable assurance that funds will be available to carry out decommissioning in a manner which protects public health and safety. The certification amount was based on the significant data base on decommissioning developed as part of the policy evaluation. The intent expressed in the proposed rule remains valid, however, it appears from the comments that the intent and proposed use of certification has been misunderstood. Thus, the retention of certifi-cation requires clarification and adjustment for it to be useful in the manner it was intended. These points are discussed in the following paragraphs.
First, it is still expected that a proper certification method would provide clear criteria and would minimize the amount of administrative effort that the NRC and licensees must expend in establishing reasonable financial assurance for decommissioning. The certification is also in-tended to minimize NRC involvement in the rate regulatory process, which is an area outside of NRC's jurisdiction. The fact that site specific cost estimates may still have to be prepared for rate regulators is out-side the scope of this rulemaking.
Second, the comments that a site specific cost estimate is preferable as noted in (a)(1) above, that the prescribed amount in the certification is not representative of most plants as noted in (a)(2) above, and that the use of the prescribed amount will be viewed as a limiting upper value by rate regulators as noted in (a)(3) above, indicates the certification method in the prors:ed rule has been misunderstood. The proposed rule stated that a utility could submit a certification that financial assur-ance for decommissioning will be provided in an amount at least equal to i
48 Enclosure A
15M*>'rM93
.?
$100,000,000 (Emphasis added). Accordingly, the proposed rule did not intend to prevent site specific cost estimates from being done and amounts greater than the prescribed amount being estimated and used for financial assurance planning as long as the estimate exceeded the prescribed amount.
Under the provisions of the proposed rule, licensees could prepare a site specific cost estimate and if it exceeded the prescribed amount, which would be acting as a threshold review level, the estimate would not be a matter for NRC consideration. The amount listed as the prescribed amount does not represent the actual cost of decommissioning for specific reac-tors but rather is a reference level established to assure that licensees demonstrate adequate financial responsibility that the bulk of the funds necessary for a safe decommissioning are being considered and planned for early in facility life, thus providing adequate assurance at that time that the facility would not become a risk to public health and safety when it is decommissioned. It is not intended to bind ratemaking bodies to that specific figure. The text of the final rule states that, if a site specific cost evaluation is prepared, it can form the basis for the certification and the licensee may indicate that provisions are being made for an amount greater than the prescribed amount.
Use of the certification approach is a first step in providing reasonable assurance of funds for decommissioning from the Commission's perspective. The second step is that the amendments require the licensee, five years prior to the expected end of operations, to submit a cost estimate for decommissioning based on an up-to-date assessment of the I
actions necessary for decommissioning and plans for adjusting levels of funds assured for decommissioning. As noted in the Supplementary Informa-j tion to the proposed rule, this estimate would be based on a then current l
l 49 Enclosure A l
[7590-01] , ,
1 assessment of major factors that could affect decommissioning u - and j would include relevant, up-to-date information. These factors could !
l include site specific factors as well as then current information on such l I issues as disposal of waste, residual radioactivity criteria, etc. , and !
would present a realistic appraisal of the decosmissioning of the specific !
l i
reactor, taking into account actual factors and details specific to the reactor and the time period. ,
Combination of these steps, first establishing a general level of .
adequate financial responsibility for decommissioning early in life, l
. followed by periodic adjustment, and then evaluation of specific provisions close to the time of decommissioning, will provide reasonable '
assurance that the Commission's objective is met, namely that at the time !
of permanent end of operations sufficient funds are available to decommis- {'
sion the facility in a manner which protects public health and safety. !
4 More detailed consideration by NRC early in life beyond the certification is not considered necessary because of the steps discussed above. In ;
addition, because public utility commissions are to set a utility's rates :
such that all reasonable costs of serving the public may be recovered [
and because NRC requirements concerning termination of a license are part of the reasonable cost of having operated a reactor, it is reasonable to assume that added costs beyond those in the prescribed amount could be obtained if the latter were too low as suggested by the commenters.
)
Based on the above discussion, the level of review contained in this decommissioning rule provides reasonable assurance for funding. In response to those commenters who were concerned that the criteria for
! evaluation of power reactor funding plans were not sufficiently specific ;
or quantitative, the certification process provides clear requirements 1
1 50 Enclosure A i i )
[7590-01]
and will achieve the objective of reasonable assurance of funding while minimizing associated administrative effort. Therefore, the amendments do not contain requirements for a cost estimate early in reactor life.
The more detailed review 5 years prior to end of life is consistent with the requirements for non-reactor facilities who are required to submit updated plans at the time of license renewal (which occurs every five years).
As discussed above, the intent of the amendments is that there be reasonable assurance of funds for decommissioning. Other issues normally outside NRC's jurisdiction such as rate of collection and whether a funding method is equitable should be considered by utilities and their ratemaking bodies. For example, to be more equitable to ratepayers, the utilities and ratemaking bodies may want to consider whether amounts should be collected based on a site specific cost estimate which exceeds the prescribed amount rather than the stepwise approach discussed above.
The final rule contains text recognizing that funding for decommissioning of electric utilities is also subject to the regulation of agencies having jurisdiction over rates, and that the NRC requirements are in addition to, and not substitution for, other requirements, and are not intended to be used, by themselves, by other agencies to establish rates. Hence, NRC will not become involved in the rate regulation process as it relates to decommissioning.
Based on these considerations, the certification requirement has been retained. However, it has been modified in several ways to incor-porate public comments to clarify its purpose and use as follows:
(1) As noted above, the text of the rule has been revised to indicate clearly that a licensee may use a site specific decommissioning 51 Enclosure A
, [7590-01) ,
cost estimate to indicate that provisions are being made for an amount greater than the prescribed amount and to delineate the correct usage of the certification.
(2) As indicated in 5 50.75(c), the amount has been increased. The revised amount is based on recent evaluations done for NRC by its con-j tractor Battelle Pacific Northwest Laboratory. As discussed in Section C.1, these estimates are considered to represent a reasonable engineering estimate of the range of decomissioning costs. In preparation of the final rule, the original PNL estimates were reevaluated and compared with 4 other estimates and updated estimates were developed based on recent information.
(3) In response to the public coments, the rule text has been ,
revised to clarify what would be covered by the prescribed amount and provisions have been included in the rule to adjust the amount for such factors as plant size and reactor type. This adjustment for plant size is based on PNL's generic evaluation of the effect of plant size on decomissioning cost and overall review of a number of plant cost
] estimates. An indication of the bases for the prescribed amounts and for i
the adjustment is contained in addenda to NUREG/CR-0130 and NUREG/CR-0672.
(4) The final rule text also indicates that amounts are based on activities related to the definition of "decomission" in 10 CFR 50.2 and
- do not include the cost of removal and disposal of spent fuel or of non-radioactive structures and materials beyond that necessary to terminate the NRC license. Costs of disposal of nonradioactive hazardous wastes 1
not necessary for NRC license termination are not included in the prescribed amounts. I I
52 Enclosure A .
i
[7590-01)
(5) In response to a number of comments, the escalation factor contained in the proposed rule has been revised to better account for factors affecting increases in decommissioning cost. The factors for labor, energy, and waste burial are indicated separately and are based on the addenda to NUREG/CR-0130 and NUREG/CR-0672.
- 3. Acceptable funding methods. The proposed rule listed internal reserve as one of the funding methods considered acceptable in providing assurance of funds for decommissioning. In internal reserve, funds are placed into an account or reserve which is not segregated from licensee assets and is within the licensee's administrative control. A number of commenters either disagreed with or favored the inclusion of internal reserve as an acceptable method. The following were comments received on this issue:
(a) Those that disagreed with inclusion of internal reserve did so for the following principal reasons:
(1) There may be problems with liquidity of the internal reserve if tne acquired assets and investments do not preserve value over time and there may be problems in issuing bonds against these assets to pay for decommissioning. In particular, funds could be used for new nuclear construction or other uscs such as accident cleanup. With this method one cannot insure that money taken from customers will be available in the future for decommissioning. This could cause serious cash flow problems at the time of decommissioning, especially if utilities are replacing old plants with new ones at the same time decommissioning takes place.
(2) The future financial viability of utilities cannot be assured and the potential exists for utility instability and insolvency. The commenters expressed concern that the utilities could not raise funds for 53 Enclosure A
_ J
L/b90-01( .
l l
- 1 decommissioning if they were having severe financial problems or were ;
facing insolvency. Comenters cited examples of potential situations.
(3) The level of assurance provided is inadequate and the genera-tion of insufficient funds could compromise safety, cause delays, and cause rate boosts. Nuclear power should pay its way fairly. In addition, by not requiring external funds NRC has not responded to the petition for '
rulemaking made by the Public Interest Research Group in 1977 or to GAO's concern that decommissioning costs be paid by current beneficiaries, not future generations. One comenter's analysis indicated that internal reserve costs exceed external reserve costs when they are adjusted to equalize relative risk with respect to the availability of funds.
(b) The comenters who agreed with the inclusion of internal reserve as an acceptable funding method did so for the following principal reasons:
(1) The use of internal reserve would enhance utilities' financial i po'sitions by reducing external financing needs. In addition, utilities have investments, cash flow, and annual earnings which are large compared to decommissioning costs.
(2) The likelihood of instability and insolvency is remote and utilities are good investments and have large assets. Comenters noted that utilities whose rates are regulated r~e essentially guaranteed a minimum return on investment and have an obligation under the ratemaking ;
system to pay for decomissioning. Comenters also noted that in times of financial difficulty, an internal reserve is sufficient because it i
is unlikely that electric generation service would not be provided and, ,
even in the case of insolvency, there will be a successor to the insolvent utility who would retain the obligation to decommission.
54 Enclosure A l l
[7590-01]
(3) Several commenters supported internal reserve because it can earn a higher rate of return, reduces revenue requirements, and provides a reasonable balance between cost and assurance. Also, commenters noted that there are financial risks associated with external reserve.
In developing the Proposed Rule, the Commission considered the question of the use of internal reserve its several documents. These include NUREG-0584, Revs.1-3, "Assuring the Availability of Funds for Decommissioning Nuclear Facilities," (Ref. 14), NUREG/CR-1481, "Financing Strategies for Nuclear Power Plant Decommissioning," (Ref. 15) and NUREG/CR-3899, "Utility Financial Stability and the Availability of Funds for Decommissioning" (Ref. 18). In addition, the Commission held a meeting soliciting public and industry views on decommissioning on September 19, 1984 and the NRC staff reviewed comments in the area of financial assurance submitted on NUREG-0586 "Draft Generic Environmental Impact Statement on Decommissioning Nuclear Facilities" (Ref. 20). These reports and meetings considered several factors regarding availability of funds for public utilities in the United States. One factor is that utilities are large, very heavily capitalized enterprises whose rates are comprehensively regulated by the State Public Utility Commissions (PUC) and the Federal Energy Regulatory Commission (FERC). This factor permits I the utilities to charge reasonable rates subject to reasonable regula- l tion and rules. In addition, the Commission has taken action recently in the promulgation of 10 CFR 50.54(w) to set requirements to establish onsite property damage insurance for use after an accident. Although these insuranca proceeds would not be used directly for decommissioning, they would reduce the risk of a utility being hit by a large demand for funds after an accident. Most utilities are now carrying insurance well in 55 Enclosure A
IFAh'M'ARJ .
O excess of $1 billion. Other factors considered are the long time period before decommissioning takes place during which time reasonable assurance of funds for decommissioning must be maintained, as well as concerns regarding utility solvency and potential problems regarding availability of funds which may occur as a result of bankruptcy.
Before publication of the proposed rule, the NRC evaluated the adequacy of various funding methods in light of financial problems encountered by some utilities which, faced with lower growth in electricity demand than they projected and rapidly increasing costs of construction, had been forced to cancel nuclear plants in advanced stages of construction and the ramifications these conditions, as well as issues related to bankruptcy, could have on a utility's ultimate ability to pay for decommissioning.
Details of this evaluation are contained in NUREG/CR-3899, (Ref. 18) prepared by an NRC consultant, Dr. J. Siegel of the Wharton School, University of Pennsylvania.
Based on the results of NUREG/CR-3899 in which it is indicated that internal reserve can be a valid funding method and on the considerations '
discussed in the Supplementary Information to the Proposed Rule, the pro-posed decommissioning rule permitted a range of options, including internal reserve, for providing assurance that sufficient funds are available for decommissioning. However, the Supplementary Information to the proposed rule noted that the regulatory approach for assuring funds for decommissioning had been particularly difficult to resolve and specifically requested additional information and comments in this area.
In particular, the Supplementary Information stated that:
"More specifically, Commissioners Asselstine and Bernthal continue to be concerned about the vulnerability of the internal funding 56 Enclosure A
(7590-01) ,
mechanism for decommissioning funds, particularly where the funds l are used to purchase assets or reduce existing debt." ,
Based on this concern, Commissioners Asselstine and Bernthal i requested "public comments on the need to consider the possibility of insolvency and its impact on the continued availability of decommission-ing funds." -
Although commenters did not generally refer specifically to the 2
separate request for comment by Commissioners Asselstine and Bernthal, a 1
number of comments, noted above, were received in this area. Those who disagreed with the inclusion of internal reserve in the rule cited problems with liquidity of the internal reserve and with the future financicl viability of utilities with resultant problems in providing decommissioning funds, and stated that the level of assurance is i j
inadequate. In contrast, other commenters agreed with the use of i
internal reserve citing the fact that the likelihood of instability and !
insolvency is remote, that utilities have investments, cash' flow, and f i
i annual earnings which are large in comparison to decommissioning cost, j i
and that the internal reserve does provide reasonable assurance. l 1
As part of the review of the comments, NRC has had NUREG/CR-3899 updated to consider the current situation in the utility industry. This analysis is contained in NUREG/CR-3899, Supplement 1, (Ref. 18) which l reviewed six utilities which have been subject to severe financial !
i i
] distress. Based on the analysis, NUREG/CR-3899, Supp. 1 indicates that,
- l I since NUREG/CR-3899 was published in 1984, the financial health of the ,
nuclear utilities has improved, with the exception of Public Service of l l
l I i l
{ 57 Enclosure A t i i
6 V tr^ r " SZt .
New Hampshire (PSNH), and that from a financial standpoint, use of internal reserve currently provides sufficient assurance of funds for decommissioning.
The basis for this conclusion is the fact that the likelihood of future crises developing, although not impossible, is extremely remote; that the total market value of the securities of each of the six utilities studied substantially exceeds its decommissioning costs; that it is not necessarily true that bankruptcy of. a utility is tantamount to default on decommission-ing obligations; and the potential that the costs of decommissioning would be recognized as a prior obligation with regard to creditors.
Despite these conclusions, Supplement I notes that PSNH has said that, unless it undergoes financial restructuring and gets the rate increase it is seeking, it probably would become the first major utility to seek protection under the Bankruptcy Act in nearly 50 years.* In addi-tion, Supplement I notes that if PSNH's Seabrook plant becomes operational, the prospects for PSNH greatly improve although bankruptcy still cannot be precluded as a possibility due to the potential for large rate hikes and resultant defections from its electric system.. Hence Supplement 1 concludes that internal reserve should not be allowed for Seabrook until the financial prospects of the utility are clarified and the viability of j the corporation insured. i t
In addition, Supplement I noted that it is imperative that, in the l case of the sale or other disposition of utility assets, no monies are distributed to any security holders until a fund is established to assure l payment for decommissioning. Supplement 1 also recomended changes in
- Subsequent to the preparation of the analysis of NUREC/C11-3899 Supple-ment 1, PSNH filed a petition in bankruptcy und O Chapt..- il of the U.S.
Bankruptcy code.
Enclosure A m - -
[7590-01]
O Federal and State bankruptcy laws relating to utilities and the inclusion
~
in the prospectus of newly issued securities of an explicit statement of the utility's financial obligations to provide adequate funds for j decommissioning. Further, Supp. 1, noted that because of changing economic and financial conditions, the NRC should conduct periodic s
reviews of the overall financial health of utilities with ongoing and prospective nuclear facilities. If such a review indicates the financial condition of utilities takan as a whole or individually is such that internal reserve does not provide reasonable assurance of funds for decommissioning, then additional rulemaking or other steps should be taken to insure availability of these funds. ,
The Commission has considered the conclusions in NUREG/CR-3899, Supplement 1, as well as the public comments received on the issue. The Commission's review in this area is confined to its statutory mandate to protect the radiological health and safety of the public and promote the common defense and security which stems principally from the Atomic Energy Act of 1954, as amended, and the Energy Reorganization Act of 1974, as amended. In carrying out its licensing and related regulatory respon- !
sibilities under these acts, the NRC has determined that there is a signif- i icant radiation hazard associated with nondecommissioned nuclear reactors. l The NRC has also determined that the public health and safety can best be protected if its regulations require licensees to use methods which provide reasonable assurance that, at the time of termination of operations, adequate funds are available so that decommissioning can be carried out in a safe and timely manner and that lack of funds does not result in delays that may cause potential health and safety problems. Although the Atomic Energy Act and the Energy Reorganization Act do not permit the NRC to regulate 59 Enclosure A
_ _ _ _ _ _ - - -- ~-
[7590-01) -
rates or to supersede the decisions of State or Federal agencies respecting the economics of nuclear power, they do authorize the NRC to'take whatever regulatory actions may be necessary to protect the public health and safety, including the promulgation of rules prescribing allowable funding methods W
for meeting decommissioning costs. (See Pacific Gas & Electric v State l
Eneray Resources Conservation & Development Commission, 461 U.S. 190, 212-13, 217-19 (1983); see also United Nuclear Corporation v. Cannon, 553 F. Supp. 1220, 1230-32 (0.R.I. 1982) and cases cited therein.)
For the foregoing reasons, the Commission continues to be concerned !
with the use of an internal reserve. The Commission rates the concerns expressed in NUREG/CR-3899, Supp.1 regarding bankruptcy at PSNH as well as the changing economic and financial conditions discussed in NUREG/
CR-3899, Supp. 1. The Commission also notes that many utilities are engaging in diversified financial activities which involve more financial :
risk and believes therefore it is increasingly important to provide that decommissioning funds be provided on a more assured basis.
In addition, to the extent that a utility is having severe financial difficulties at the time of decommissioning, it may have difficulty in funding an internal reserve when needed for decommissioning. The :
Commission recognizes that the market value of the stock of those ,
utilities studied in NUREG/CR-3899 has exceeded decommissioning cost. l However, although the law in this area is not fully developed, in the event of bankruptcy there is not reasonable assurance that either unsegregated or segregated internal reserves can be effectively protected from claims of creditors and therefore internal reserves cannot be made 1 legally secure. In addition, because of the nature of the internal l 60 Enclosure A
^
- (7590~-01) reserve, the funds collected are not isolated for use for decommissioning.
Instead the utility may use the funds for other unrelated purposes.
For the above reasons, the Commission concludes that the internal reserve does not provide reasonable assurance that funds will be avail-able when needed to pay the costs of decommissioning and hence does not provide reasonable assurance that decommissioning will be carried out in a manner which protects public health and safety. Accordingly, the proposed rule has been modified to eliminate the internal reserve as a possible method of providing funds for decommissioning.
In reaching its conclusion not to permit use of internal reserve for decommissioning, the Commission believes it important not to impose inordinate financial burdens on licensees. The modification to the proposed rule is not expected to impose such a burden for several 1 reasons. First, licensees have 2 years from the effective date of the final rule before they have to submit information regarding financial assurance. Second, the external reserve is a sinking fund accumulated over a period of time.
~
Third, a number of states (accounting for almost 50% of power reactors) already require external funding methods. Fourth, recent changes in the tax laws allowing current deductions for external reserves may reduce the cost differential between internal reserve and external reserve. Finally, the rule does not require funds accumulated to date in internal reserves to be transferred to external reserves, l
however those existing funds if lef t in internal reserves would not be acceptable for use in meeting the requirements of $ 50.75(e)(1) and (3).
61 Enclosure A
[7590-01]'. *
- 1 i rei r <
cow, veral comenters discussed the funding !
methods ; .r : e 'nternal reserve. These included principally L the use of - ent of the funds or the use of an external fund coupled '
with insurance against premature decommissioning. Principal reasons for favoring these niethods include the fact that there may be shutdown of a reactor before the date of its expected end of life due to either an accident or problems with reactor aging or obsolescence. Consequently, sufficient funds for decommissioning might not have been collected by a method which accumulates funds over projected reactor life. Conversely, ,
several commenters indicated that it is appropriate to rely on the property j damage insurance requirements of 10 CFR 50.54(w) to supplement decommission- l ing funding methods. They argue that, with the substantial amount of property insurance required, even in the highly improbable event of an accident-related, premature decommissioning, the utility will still have sufficient resources available after the decontamination process to carry )
out decomissioning. Some of the comenters recognized the possible 1
difficulties in obtaining non-accident premature decomissioning insurance. I One comenter stated that surety bonds or insurance are not viable alter-natives for normal decommissioning or premature decommissioning not asso-ciated with an accident. The commenter noted that nuclear property insurance would be available only if an insured event necessitated premature decommissioning and only in the amount necessary to repair the plant for damages caused by the accident. Premature decommissioning due to regulatory mandate would not be covered. The commenter also noted that surety bonds in the amount of $100 million are not generally available.
62 Enclosure A i
[7590-01]
4 The Commission notes that these comments must be considered within
- the context of Commission requirements for onsite property damage
] insurance, the proceeds from which could be used to decontaminate a I
reactor after an accident. Although these insurance proceeds would not be used directly for decommissioning, they would reduce the risk of a utility being subject to a tremendous demand for funds after an accident, j The Commission has implemented its proposed requirement in 10 CFR 50.54(w) for slightly over $1 billion of insurance. An important consideration in 4
selecting an acceptable method for providing funds for decommissioning is that the method be reasonably cost effective. Prepayment of funds has been recognized by several studies as being significantly more costly than the other methods. In view of the unlikely nature of the events and
{ the potential problems being considered, prepayment generally has a cost '
j too high for the benefit that would be realized. Use of insurance for i
) '
non-accident related decommissioning was found in an earlier study l
performed for the NRC, NUREG/CR-2370 (Ref. 16), to have potentially
] serious problems of insurability and moral hazard and is not currently available. (Moral hazard is a term used in the insurance industry to i j indicate a situation of laxity with respect to loss prevention or loss control where those insured have access to risk prevention.) Finally, i
earlier studies in NUREG-0584 found that surety bonds were not generally j j available in the amounts necessary for decommissioning power reactors, i i
j In light of the factors considered, including the assurance provided i by the various methods, the unlikely nature of the various events and the 1
cost and practicality of providing more absolute assurance by certain
- methods, the Commission has concluded that the funding methods listed in i the rule as modified by the exclusion of internal reserve are adequate.
1 i
i 63 Enclosure A J
~~ ~ ~ ' ~
[7590-011
- 8 Two commenters stated that well capitalized, firmly established private organizations operating research and test reactors should be i allowed to guarantee compliance with financial assurance requirements by j use of the certification process which is permitted for government enti- l ties. In response to this comment, it is noted that certain government ;
licensees are permitted in the amendments to meet the funding require-ments of the rule by submitting a statement of intent that the appropriate i 1 !
government entity will be guarantor of decommissioning funds. Private i organizations were not afforded that option in the proposed rule. The different treatment arises because there is reasonable assurance that the appropriate government entity, which has the power of taxation, will pro-vide adequate funding in the future to decommission the facility in a manner which protects public health whereas this is not necessarily the case with private organizations even if they are currently adequately capitalized. If they have no funds for decommissioning there can be i
j problems with completion of decommissioning. As noted in Section C.5 >
1
{ below, use of parent company guarantees backed up by financial tests will
) be permitted for private organizations eperating research and test i
l reactors.
i Four commenters indicated agreement with proposed S 50.82(c)(1) which j would require a licensee planning to delay completion of decommissioning by including a period of safe storage or long-term surveillance to place 1
funds into an external fund or use a surety or certification method, while 1
j four commenters disagreed with the proposal indicating that utilities l Should not be required to shift to external funding. In response, as I noted in the response to a previous comment, the proposed rule has been
)
- l modified to delete internal reserve as an acceptable funding method.
1 64 Enclosure A i
Because there is as great or greater need for assurance of funds over the extended timeframe involved with a facility in SAFSTOR when the facility is no longer a revenue producing asset, the proposed requirement in S 50.82(c)(1) for external funding during SAFSTOR remains.
- 4. Funding plans. A number of commenters indicated that it was important for the funding plan to be updated over the operating life of the facility because there would be increases in costs over facility life.
Some commenters indicated that there should be periodic adjustments of the funding level, and most said there should be a specific frequency indicated in the regulations with most saying frequencies of 5 years and some indicating it should be more frequent.
In response, the Commission agrees with the importance of updating the funding plan over the operating life of the plant. This was recognized l in the proposed rule which requires that a funding plan include "means of adjusting cost estimates and associated funding levels over the life of the facility" and which also requires each reactor licensee to update his cost estimate "at or about 5 years prior to the projected end of opera-tions." In order to clarify that the updates should take place over the course of the facility lifetime, the proposed rule his been modified to indicate that a funding plan include means of adjusting cost estimates and associated funding levels periodically over the life of the facility.
The frequency for these updates is not included in the rule but would be included in regulatory guidance under consideration. This will previde more flexibility in dealing with different types of licensees and finan-cial considerations. It is expected that regulatory guidance will indi-cate the frequency of adjustment for cost estimate and funding levels, j 65 Enclosure A l
(7590-01) , '
I A number of commenters objected to the requirement in the rule that, j i
submittals of reactor funding plans be a condition of license. The com-menters indicated that by doing su any change in the funding plan could be ,
interpreted as a license amendment. The commenters argued that this was j unnecessary since the funding requirements do not have a direct impact on the safe operation of the plant. This,could have a negative effect on t
i continued plant operations even though there was no safety concern. Most commenters argued that the requirements would be better promulgated as l regulations which would not decrease NRC's enforcement authority. The Commission has considered these comments in light of the need to pro- -
vide reasonable assurance of the availability of funds for decommissioning !
and, in response, in order to build flexibility into the rule, has modi- '
L fied the proposed rule to make the reactor funding requirements a specific l regulatory requirement in 5 50.75 instead of a license condition, i
- 5. Funding requirements for material licensees. For material licen- !
sees, the proposed rule contained provisions that an applicant or licensee ,
may submit a certification that financial assurance for decommissioning ;
will be provided in a prescribed amount stipulated in proposed 10 CFR !
Parts 30, 40, and 70. I The amount is dependent on the quantity of licensed material which the licensee possesses. Two commenters indicated that the cost amounts prescribed in the regulations for 10 CFR Parts 30, 40, and 70 licensees are too high for the quantities of material listed and that the prescribed cost amounts should be set more realistically or the pre-scribed radioactivity levels should be increased. One of the two com- l
\
menters who felt the estimates were too high noted that the multiples of j i Appendix C quantities prescribed in the rule for some isotopes amount to j absolute quantities of less than a curie and the commenter did not think '
66 Enclosure A l
J
~
[7590-01]
that the decommissioning costs for such a license would amount to the sums prescribed in the proposed rule. The other commenter indicated as an example that the amount of Am-241 in unsealed form requiring a decom-missioning cost of $500,000 is 10 millicuries. Three other commenters felt that the prescribed amounts appeared to be too low and cited specific examples to support their claim. These included the following:
cleanup of a U.S. Army building which had burned cost over $300,000; cleanup of the extensive contamination at a USAEC contractor facility at Weldon i
Spring cost $200,000,000; cleanup of four igloos at the Seneca Army Depot by the U.S. Army cost $300,000 to $1,000,000; cleanup and storage of contaminated soil by 00E in the vicinity of the W. R. Grace and Stepan Chemical facilities cost $2-4 million. In addition, one of the commenters pointed out that use of contractors to perform the work could increase Costs.
In response to the commenters who felt the estimates were too high, it is the opintori of the Commission, based on the data base cited in the Supplementary Information to the proposed rule, that the prescribed amounts are reasonable estimates and that it is not the rule's intent that the indicated costs be used in every situation. The purpose of setting the amounts is to provide an approach which minimizes the burden on the majority of licensees and on the NRC while providing assurance of funds for decommissioning. If, in a particular case, the prescribed cost amounts are too hign, the licensee has the option of submitting a funding plan with a facility specific cost estimate.
l In response to the commenters who felt the estimates were too low, certain points must be considered in assessing the comments and the examples cited. Some of the examples appear to be cases where there was i
67 Enclosure A l
[7590-01.1 , 1 accidental spread of contamination beyond that normally encountered. The i funding assurance provisions of the proposed rule are not intended to address the costs of cleanup resulting from an accident. Provisions for funding cleanup of accidental releases of radioactive material were noted as being under consideration in a separate rulemaking (see Advanced Notice of Proposed Rulemaking published June 7, 1985, 50 FR 23960).
Another point to consider is that certain facilities contain larger quantities of radioactive material than are specified in the sections of the rule amendments (i.e., SS 30.35, 40.36, and 70.25) permitting use of a prescribed funding amount. Licensees of these facilities would be required to submit a decommissioning funding plan containing a cost estimate specific to those larger facilities. Under the provisions of the appropriate sections, licensees of these larger facilities would be permitted to initially use a prescribed a&ount of $750,000 in their financial assurance planning. However, use of this prescribed amount is only a temporary action which is intended to reduce the administrative effort associated with implementation of the rule amendments and these licensees are required by the indicated section of the rule to eventually submit a funding plan (with the facility decommissioning cost estimate) at the time of application for license renewal.
PNL has provided updated decommissioning cost estimates to NRC for use in the Final Generic Environmental Impact Statement. Appropriate information has been taken from those updates for use in the final rule to account for factors such as inflation. The cost estimates for mate-rial licensees do not specifically include the assumed use of contractor costs because, based on the PNL studies, the prescribed amounts listed in 68 Enclosure A
[7590-@l]
the rule are considered reasonable in providing adequate funds so that a facility does not become a concern to public health and safety. The additional expense associated with requiring all material licensees to set LLide in their funding method the added costs of assuming use of a contractor is not justified compared to the small number of licensees expected to have to use contractors.
The estimated cost of decommissioning is based on activities related to the definition of "decommission" in 10 CFR 30.2 (and similar sections in other parts) and does not include the cost of removal and disposal of nonradioactive structures and materials beyond that necessary to terminate the NRC license. Disposal of nonradioactive hazardous waste not necessary for NRC license termination is not covered by these regulations but would be treated by appropriate agencies having responsibility over these wastes.
Several comments were received on the proposed rule sections which list funding methods that 10 CFR Parts 30, 40, and 70 applicants and licensees may use and that are considered to provide reasonable assurance of the availability of funds for decommissioning. Five commenters indi-cated that this list was too restrictive and that financial tests of licensees should be utilized in determining acceptable funding methods for materials licensees. These commenters argued that use of financial tests on a case-by-case basis would improve the degree of financial assurance and eliminate unnecessary cost burdens for many non-utility, non government entities. As precedents and examples of tests which could be used by NRC, the commenters generally referred to the financial tests contained in 40 CFR Parts 264 and 265 for hazardous waste facilities regulated by EPA. The commenters indicated that these tests could be 69 Enclosure A 1
[7590-01) used alone or combined with licensee guarantees of funds, with self-insurance or with internal reserve as acceptable methods for assuring funds for decommissioning. One commentar indicated that letters of credit provided a cost-effective method for his operations.
The Commission did not include the financial test as an acceptable funding method for materials facilities in the proposed rule. It was felt that because of the potential for changing licensee financial conditions and the fairly lengthy time perlod involved before decommis-sioning would take place that the financial test would not provide sufficient assurance of the availability of funds for decommissioning.
Also, additional staff time could be necessary to monitor the financial status of a number of licensees. This position and the funding methods l
listed in the proposed decommissioning rule were consistent with the funding methods listed in earlier NRC promulgated rules in 10 CFR Part 40, Appendix A, regarding requirements for funding the decontamina- l tion and decommissioning of uranium mills and tailings, and in 10 CFR l Part 61 regarding funding for closure of low-level-waste burial grounds. l l
The commenters point out that the Environmental Protection Agency 1 permits the use of financial tests when accompanied by corporate guarantees for its hazardous waste facilities and recommended that the NRC use similar financial tests for meeting financial assurance require-ments. The staff recognizes that financial tests may be useful in certain situations and can minimize impacts on licensees. Hence, the regulation has been modified in the final rule to specifically permit licensees to use parent company guarantees with accompanying financial tests to meet the financial assurance requirements of the regulation. The use of the 70 Enclosure A
, [7590-01]
parent company guarantee and financial test is taken from the U.S.
Environmental Protection Agency's regulations 40 CFR Parts 264 and 265.
Use of the parent company guarantee and financial test provides assurance in that the company will provide an independent commitment beyond that of the licensee to expend funds. This requirement is consistent with the NRC's recently promulgated Policy ~. Guidance Regarding Parent Company and Licensee Guarantees for Uranium Recovery Licensees issued in December 1985. A parent company guarantee may not be used in combination with the other financial methods listed in the rule to satisfy the requirements of this section.
Other funding methods, including letters of credit, will continue to be acceptable for providing assurance of funding. Use of prepayment or other external trust funds is different in approach from use of a surety bond, insurance or other guarantee method. With prepayment, the licensee is actually using the instrument to pay for decommissioning of the facility, while with the second approach, a financial instrument is used as backup to pay for decommissioning in the event that the licensee is unable to complete these activities. If a surety, insurance, or other guarantee method is used to actually pay for decommissioning, the licensee is still fully responsible for all of its decommissioning requirements.
NRC intends to periodically review the overall financial status of licensees to assess the effectiveness of the funding methods permitted in the regulations.
One commenter was concerned that, in the case of licensees having materials licensed under more than one part of 10 CFR and used within 71 Enclosure A
[7590-01] ,
common facilities, the rule would require a separate decommissioning plan for each license and recommended that a consolidated plan be allowed. In response to this comment, in some cases where byproduct, source, and/or special nuclear material are used in the same facilities, it would be very aifficult to develop separate decommissioning or funding plans for termin-ating each license, in particular where there is interdependence of facili-ties, operations, or projected decommissioning activities. Consolidated plans based on a combined analysis of the facility decommissioning would i
be permitted. If a licensee operates multiple independent facilities and/or sites under a single license, a consolidated decommissioning or funding plan would have to delineate procedures and cost estimates for each facility / site. The regulatory guides currently under consideration would include further details concerning th,ese situations. The rule is broad enough to encompass these situations.
Two commenters expressed concern regarding the licensee's respons-ibility for decommissioning. One commenter indicated that it was not clear in the proposed rule whether financial assurance requirements apply to each license, each licensee, or each facility and recommended that the
- licensee be specified as the responsible unit. The other commenter i expressed the concern that there exists the potential for reducing com- 1 panies' liability for decontamination activities should the NRC approved 1
funding plan be inadequate.
In response to these comments, it should be noted that amended 10 CFR Parts 30, 40, and 70 require that each holder of a specific license provide financial assurance for decommissioning thus specifically indicating that the licensee is the responsible party for financial assurance. Funding and decommissioning plans submitted by a holder of 72 Enclo9ure A
. [759]F@8]
multiple materials licenses may be consolidated. It is expected that the requirements contained in amended 10 CFR Parts 30, 40, and 70 will provide reasonable assurance that funds are available for decommissioning nuclear facilities. Specifically, S 30.35 (and related sections in other parts) requires submittal of a funding plan containing an estimate of the cost of decommissioning or use of a certification of an amount prescribed in the regulations. The cost estimate contained in the funding plan will be based on site conditions and can use, as a base, information developed by Battelle Pacific Northwest Laboratory (PNL) in a series of reports on technology, safety, and costs of decommissioning nuclear facilities. NRC's review and evaluation of the estimate can use not only the PNL reports but experience gained at other materials facility decommissionings.
Section 30.35 also provides that the licensee include provisions in the funding plan for adjusting decommissioning cost estimates and associated funding levels over the life of the facility to take into account changing economic and technical conditions. Even in the event that these efforts result in a shortfall of funds at decommissioning, a matter which concerns the commenter, the regulations specificaMy state that it is the licensee's responsibility to fund and carry out decommissioning in a manner which protects public health and safety. Accordingly, the licensee would be
~
under a continuing obligation to find the means for completing decommis-sioning.
- 6. Funding requirenents for Federal licensees. One commenter, the Department of the Army, indicated that the proposed requirements for Federal agencies, specifically proposed sections in Parts 30, 40, 50, 70, and 72, requiring a certification that the appropriate government entity will be guarantor of decommissioning funds, appear inconsistent with 73 Enclosure A
[7590-01) .
Federal statute. The commenter suggested either NRC should spearhead statutory relief or establish a Federal agency funding strategy in order to satisfy the intent of the NRC proposed rule.
The Commission, in responding to this comment, notes that it is based on the provisions of the Anti-Deficiency Act, 31 U.S.C. 1341. The Anti-Deficiency Act prohibits the creation of an obligation or the expenditure of funds in excess of appropriations unless the contract or obligation is authorized by law. The purpose of the Act is to "keep all departments of the Government, in the matter of incurring obligations for expenditures, within the limits and purposes of appropriations annually provided for conducting their lawful functions." 42 Comp. Gen. 272, 275 (1962). The Act applies to transactions among government agencies as well as transac-tions between the government and the private sector. See 59 Comp. Gen.
386, 389 (1980).
l While the Anti-Deficiency Act might prohibit the expenditure of fur.ds for decommissioning in the absence of an appropriation, nothing in the Anti-Deficiency Act prevents a government agency from seeking appro-priations for future obligations. Nor is there anything in the Act that bars a government agency from obligating appropriated funds for the purpose of complying with rules imposed by other government agencies at the time those rules require an expenditure of funds. Thus, in practice, use could be made of other funding methods besides the certification option such as external funding.
As discussed in the Supplementary Information to the proposed rule, the purpose of the proposed sections with which the commenter is concerned is to permit licensees to obtain a guarantee that a government agency will assume financial responsibility for decommissioning the facility. This 74 Enclosure A
[7590-013 would most likely be possible when the licensee is a State or Federal l
agency or a State-affiliated organization such as a university or hospital.
This provision of the rule recognizes that these licensees should be capable of providing funds for decommissioning. The intention of the proposed rule is that these State and Federal licensees should, early in their facilities' lifetime, be aware of the eventual decommissioning of the facility, specifically its cost, and make their funding bodies aware of those eventual costs. ine provisions of the rule requiring naming a guarantor of funds may be subject to misinterpretation. Accordingly, the proposed rule is being modified to indicate that Federal and State licen-sees should provide a statement of intent that they have an estimate of the cost to decommission their facilities and that they will obtain funds when necessary for decommissioning. This modification should satisfy the need for assurance from these facilities within the constraints of govern-mental budgetary policies.
- 7. General comments on financial assurance. A number of commenters disagreed specifically with the need for the funding provisions contained in the proposed rule for electric utilities. T'he primary reasons cited by the commenters for the disagreement were the following: utilities are regu'.ated by State and Federal rate regulators who are bound to set a utility's rates such that reasonable costs of serving the public are recovered; NRC has recently eliminated financial qualifications require-ments for reactors and this is a similar situation; most utilities already recover decommissioning costs in rates; utilities recognize that those who benefit from the plant should pay for decommissioning; and that the proposed rule will impose a financial penalty on utilities and will com-plicate the existing process.
l 75 Enclosure A
[7590-01] -
In contrast, a number of other commenters indicated that there was a need for rules in this area because they had several concerns over whether adequate funds will be available for decommissioning. Several commenters expressed concern that there must be a clear statement with regard to the responsibility for decommissioning and that utilities should not be able to evade liability for funding of decommissioning costs. In particular one commenter indicated that a utility could avoid liability for decom-missioning by forming "holding companies" which would protect assets from the liability of a shutdown reactor. The commenter indicated that these 4
holding companies could diversify into new ventures outside the scope of Federal and State regulation, could take funds from the power company, and thus leave the electric utility portion of the company in a finan-cially weak condition. This financially weak utility might find it very difficult to fund decommissioning and therefore become a threat to public health and safety. The commenter indicated that the rule should provide
]
guidelines to address th'ese issues otherwise ratepayers would be stuck with this problem and radiological hazards may exist. .
Several commenters addressed the issue of the proper roles of NRC and State and Federal ratemaking agencies in establishing funding methods.
Some commenters indicated that the rule as presented is satisfactory as long as it is clear in allowing other involved State and Federal authori-ties to decide issues related to the ratemaking impact of decommissioning l
fund accumulation.
The commenters also stated that the rule should not go any further in applying more prescriptive requirements or pre-empting State laws and that the specific funding method should not be prescribed by the rule but should be determined by the ratemaking authorities because 76 Enclosure A
[7590-01]
O they are in the best position to determine the most effective and economic method to arrive at the least cost option, taking into account taxation, )
accounting, financial and other loca'l considerations. One commenter indi- l cated that the rule should explicitly permit State and Federal ratemaking agencies to apply more stringent funding requirements. Commenters indi-cated that NRC's jurisdictional responsibility and therefore its principal concern she ld be that decommissioning is carried out in a safe manner and that ratemaking bodies should have responsibility for choosing cost-effective funding methods. One commenter expressed concern that there may be serious jurisdictional problems and disputes with NRC's rule in that NRC is seeking to exercise control over economic matters related to decomiss-sioning expense. The commenter indicated that the NRC should make it clear what functions of other ratemaking agencies it intends to supplant and how its regulations will fit with existing State and Federal regulation of decommissioning costs. One commenter questioned how NRC will implement the rule in the case of a licensee whose rate regulator does not allow the licensee to recover funds in its rates and set up a decommissioning fund.
In response to these comments it should be noted that the Commission's statutory mandate to protect the radiological health and safety of the public and promote the common def'ense and security stems principally from the Atomic Energy Act of 1954, as amended, and the Energy Reorganization Act of 1974, as amended. In carrying out its licensing and related regulatory responsibilities under these acts, the NRC has determined that this regulation is needed because there is a significant radiation hazard associated with nondecommissioned nuclear facilities. The NRC has also determined that the public health and safety can best be protected by 77 Enclosure A
promulgating a rule requiring reasonable assurance that at the time of termination of operations adequate funds are available so that decom- -
missioning can be carried out in a safe and timely manner and that lack of funds does not result in delays that may cause potential health and safety problems. Although these Acts do not permit the NRC to regulate rates or to interfere with the decisions of State or Federal agencies respecting the economics of nuclear power, they do authorize the NRC to take whatever regulatory actions may be necessary to protect the public health and safety, including the promulgation of rules prescribing allowable funding methods for meeting decommissioning costs. (See Pacific Gas & Electric v. State Eneray Resources Conservation &
Development Commission, 461 U.S. 190, 212-13, 217-19 (1983); see also United Nuclear Corporation v. Cannon, 553 F. Supp. 1220, 1230-32 (D.R.I.
1982) and cases cited therein.) The fact that these regulatory actions may have an economic impact does not mean that they lie outside NRC's jurisdiction.
The Commission has considered the roles of the state Public Utility Commissions (PUCs) and the Federal Energy Regulatory Commission (FERC),
as well as the NRC, in establishing acceptable methods available to nuclear power reactor licensees for accumulating funds for decommission- l ing. Each of these agencies has a role in this area. The Federal Energy !
Regulatory Commission has the responsibility for setting rates for the transmission and sale (wholesale) of electricity by investor-owned util-ities in interstate commerce and authorizes the conditions, rates, and charges for interconnections among electric utilities. The sales of electricity for which FERC would set rates are small, comprising about l
78 Enclosure A i
- CNN"M9) )
13 percent of total U.S. electricity sales. State public utility commis-sions have the responsibility for setting rates for retail sales of l electricity to homeowners and companies doing business in their states.
The NRC staff has had contact with staff of the Federal Energy Regulatory Commission and with State agencies. These agencies indicated that they recognize the NRC's role in setting standards with respect to health and safety, and, in particular, that they support the rule as it was promul-gated with certain modifications as long as it is understood that states may choose among the funding alternatives based on their specific respon-sibilities for protecting the interests of consumers by developing reasonable rates for providing public utility services. Under the existing statutory scheme the NRC has the authority to require specific funding arrangements in order to protect public health and safety whereas the other agencies do not. NRC's rule amendments permit a State or Federal rate regulatory agency to choose from among the funding alter-natives listed in the final rule and to choose levels of funding based on specific considerations related to their ratemaking responsibilities, as for example cost and equitability for early ratepayers versus later ratepayers.
In response to comments that there should not be funding requirements for decommissioning because financial qualification requirements for con-struction have been eliminated, it is NRC's view that the elimination of financial qualification requirements does not eliminate the need for pro-viding reasonable assurance of funds for decommissioning. When the rule on elimination of financial qualifications was proposed, the Commission stated that decommissioning was more properly dealt with in the separate 79 Enclosure A
[7590-01] .
rulemaking then underway. In promulgating the proposed rule on decommis-sioning, Commissioner Bernthal drew a distinction between decommissioning assurance and the rule on eliminating the financial qualification review at the licensing stage. Factors cited by the commenters, such as the presence of rate regulators or recognition that those who benefit from plants should pay all costs, do not provide reasonable assurance in and of themselves that health and safety will be protected.
Some commenters stated that the proposed rule would impose a finan-cial penalty on utilities and complicate the existing regulatory process.
The NRC staff does not believe that this will occur. The proposed rule has the narrow focus of protecting public health and safety by having in place basic minimum standards for funding methods which provide reason-able assurance of funding for decommissioning in a safe and timely manner. The methods allowed include a variety of methods currently available to licensees. As noted in the response to a comment in Sec-tion C.3, the proposed rule has been modified to delete internal reserve as an acceptable funding method, however, this is not expected to add significantly to licensee's burden for the reasons discussed in Sec-tion C.3. As noted in Section C.2 the certification of funding levels which may be more than but not less than amounts prescribed in the rule is included as a means for minimizing licensee burden in complying with the amended regulations. The rule, and the NRC's. implementation of it, does not deal with financial ratemaking issues such as rate of fund collection, procedures for fund collection, cost to ratepayers, taxation effects, equitability between early and later ratepayers, accounting procedures, ratepayer versus stockholder considerations, responsiveness to change and other similar concerns. In addition, the rule does not 80 Enclosure A
[7590-0'l) --~~~7 deal with costs of demolition of nonradioactive structures and equipment or with site restorition after termination of the NRC license. These matters are outside NRC's jurisdiction and are the responsibility of the State PUC's and FERC. As outlined above, considering the distinct roles that the NRC and the ratemaking agencies have, NRC will not become involved in the rate regulation process as it relates to decommissioning.
Based on the above discussion, the Commission believes that the rule is an equitable means of requiring reasonable assurance of funding for decommissioning without imposing an undue burden en licensees.
With regard to the specific concern regarding formation of holding companies, the NRC could condition the approval of the decommissioning plan by requiring the licensee to include sufficient funds in the estab-lishment of the holding company. In other words, the NRC would not approve the decommissioning plan unless the holding company had suffi-cient assets to meet its obligations pursuant to the decommissioning plan in addition to its normal obligations. Thus, the licensee could not sequester assets and liabilities in a manner which would defeat the decom-missioning plan. The NRC would have sufficient authority under the Atomic Energy Act and its existing regulations that, if a utility were to try to reorganize in order to evade its decommissioning obligations, the Commis-sion would be able to take action to prevent any adverse health and safety impacts.
The commenters also indicated that there must be a clear statement with regard to the responsibility for decommissioning. The Supplementary Information to the proposed rule states that "The licensee is responsible for completing decommissioning in a manner that protects health and safety."
In addition, the Supplementary Information and the text of the rule make 81 Enclosure A i
(7590-01] ..
clear that the licensee must take responsibility for planning for decom-missioning by providing a reasonable level of assurance that funds are available for decommissioning and, at the time of permanent termination of operations, by submitting a decommissioning plan which addresses the choice of decommissioning alternatives, methods to control occupational and public health and safety, the planned final radiation survey, and funding for decommissioning. These provisions make clear that the licensee has the legal responsibility to plan for and accomplish decom-t missioning of the facility by preparing the property for release for unrestricted use and that this responsibility cannot be evaded.
D. Residual radioactivity. Commenters expressed concerns about the absence of residual radioactivity limits, and urged the NRC to develop such levels as quickly as possible. Reasons given were health and safety concerns, difficulty of decommissioning planning, and commonality of objectives concerning waste burial and decommissioning requiring a de-minimis level. Several commenters made specific comments on the numeric value of the residual limit and how it should be chosen. Commenters also expressed concern that this rule should not be issued until the rule on residual radioactivity level is issued because without it one cannot plan or estimate cost and entirely. satisfy financial assurance requirements.
Commenters also indicated that the value of residual radioactivity limits will impact cost for non power reactors.
The Commission is participating in an EPA organized interagency working group which is developing Federal guidance on acceptable residual radioactivity levels which would permit property to be released for l
l 82 Enclosure A
- c. [7590-01]
unrestricted use. Proposed Federal guidance is anticipated to be published by EPA. NRC is planning to implement this guidance as soon as possible. The selection of an acceptable level is outside the scope of this rulemaking. Currently, criteria for residual contamination levels do exist and research and test reactors are being decommissioned using present guidance contained in Regulatory Guide 1.86 for surface con-tamination plus case-by-case considerations for direct radiation. As an example, NRC provided such criteria in letters to Stanford University, dated 3/17/81 and 4/21/82 providing "Radiation criteria for release of the dismantled Stanford Research Reactor to unrestricted access." The NRC is currently developing interim guidance with respect to residual contamination criteria. The cost estimate in a funding plan can be based on current criteria and guidance regarding residual radioactivity levels for unrestricted use. The information in the studies by Battelle Northwest Laboratory (Refs. 2 thru 13) and Oak Ridge National Laboratory (Refs. 17 and 19) on decommissioning have indicated that in any reason-able range of residual radioactivity limits, the cost of decommissioning is relatively insensitive to the radioactivity level and use of cost data based on current criteria should provide a reasonable estimate. Even in situations where the residual radioactivity level might have an effect on decommissioning cost, with the update provision in the rule it is expected that the decommissioning fund available at the end of facility life will approximate closely the actual cost of decommissioning. j It is imperative that decommissioning regulations in 10 CFR Parts 30, 40, 50, 70, and 72 be issued at this time because it is important to establish financial assurance provisions, as well as other decommissioning l
l
)
1 83 Enclosure A
[7590-01) -
planning provisions, as soon as possible so that funds will be available to carry out decommissioning in a manner which protects public health and safety. Based on the need for the decommissioning rule to supplement provisions currently existing with those contained in the rule amendments, the Commission believes that the rule can and should be issued now.
E. Environmental Review Requirements. A number of commenters were concerned that the proposed rule would not require the preparation of an environmental impact statement (EIS) in connection with each decommis-sioning of a reactor but would require only an environmental assessment (EA) unless the assessment showed that an EIS should be prepared in a particular case, while other commenters made specific comments supporting this aspect of the proposed rule. Of the commenters opposed, several thought that the proposed rule violated the National Environmental Policy Act, one commenter felt that there needed to be more successful experience at decommissioning various types of reactors before it could be decided that an EA was sufficient, another suggasted that an EIS should be pre-pared for major facilities such as power reactors and fuel fabrication facilities but an EA would be appropriate' for smaller facilities, and one commenter suggested that there should be an EIS but that reference to the GEIS could be allowed if careful ~ study or testing or both at a given facility showed that the generic approach was adequate.
A number of commenters who opposed the elimination of the requirement for a site-specific EIS argued that the EIS at licensing could not adequately estimate impacts in detail because much could change in the 30 to 40 years before decommissioning. Although the proposed rule discussed 84 Enclosure A
O'
[7590-05) the fact that EIS's at licensing should address the impacts of decommis-sioning, the analysis of those impacts at that time is not considered to take the place of evaluating environmental impacts at the time of decom-missioning. At the time of decommissioning, a large quantity of waste-must be handled and disposed of; this waste is essentially a result of having operated. The NRC action to be taken at the time of decommission-ing is to approve an appropriate method of handling this waste. Alterna-tive methods of handling this waste will have different impacts which can be systematically assessed.
The Commission's primary reason for eliminating a mandatory EIS for decommissioning is that the impacts have been considered generically in a GEIS. The Commission determined that examination of these impacts and their cumulative effect on the en*onment and their integration into the waste disposal process could best be examined generically. On
, a final, updated GEIS was published (Ref. 20). The GEIS shows that the difference in impacts among the basic alternatives for decommissioning is small, and the dose impact of decommissioning is small, whatever alternative is chosen, in comparison with the impact accepted from 40 years of licensed operation. The relative impacts are expected to be similar from plant to plant, so that a site-specific EIS would result in the same conclusions as the GEIS with regard to methods of decommissioning. Although some commenters correctly point out that an EA is much less detailed in its assessment of impacts than an EIS, if the impacts for a particular plant are significantly different from those studied generically because of site-specific considerations, the environ-mental assessment would discover those and lay the foundation for the 85 Enclosure A
[7590-01) ,,
preparation of an EIS. If the impacts for a particular plant are not significantly different, a Finding of No Significant Impact would be prepared. In answer to the comment concerning violation of NEPA, the Commission's rules concerning EA's and EIS's comply with case law and Council on Environmental Quality regulations. In response to the concern that decisions on decommissioning will,be made without public input, decommissioning involves amendment of the operating license and the NRC rules provide an avenue for public input with respect to license amendment.
t F. Other General Comments. A number of comments of a general nature, some of which were outside the scope of the regulation, were received. Detailed responses to individual comments are contained in NUREG-1221. , General comments discussed below include questions regarding applicability of the regulations to different licensees and those regarding waste disposal.
- 1. Applicability of regnlation to different licensees. Some commenters were concerned that the regulations may have been drafted with power reactors in mind and applied to non power reactors without adequate realization or consideration of the differences in the level of difficulty in decommissioning between these classes of facilities. They suggested that the rule should distinguish between reactor types and make require-ments appropriate for non power reactors. One commenter pointed out that the costs of decommissioning research reactors are considerably less than those for power reactors and also that there was considerable experience in decommissioning research reactors and that there were no real uncer-tainties. Another commenter indicated that adequate budgets were difficult i
86 Enclosure A
.. [7590-01]
to obtain, that the "existence of research reactors at universities hangs l on a thin thread," and that the burden of additional requirements could cause these threads to be cut. One commenter suggested that the health and safety of the public is better protected if research reactors are operating and effective rather than to have them shut down or made ineffec-tive and that additional rules which result in "nonproductive" work and costs take resources needed for effective research centers.
In response, it should be noted that the Commission has not drafted the rule amendments for power reactors and then applied it to non power reactors without taking into consideration the differences. The data base included a contractor study addressing the technology, safety, and costs of decommissioning research and test reactors (Ref. 4). The com-ments concerning lower costs, more experience, fewer hazards, and open-ended operating life are true, however, these factors have been considered.
I The rule does distinguish between power and non power reactors in the methods allowed for financial assurance. The methods allowed for non-power reactors are the same as for materials licensees and require commitment or guarantee at startup of the total amount of funds needed for decommissioning, whereas power reactor licensees have the option of building up the fund over facility life. As a means of minimizing the burden, Federal or State government licensees may provide a statement of intent indicating that funds for decommissioning will be obtained when necessary. The burden of providing financial assurance in the case of private non power reactors is unavoidably greater, but will be in line with the projected costs for the particular reactor. The remarks of the commenter concerned about existence of research reactors hanging on a 87 Enclosure A
[7590-01] .
thin thread, in fact, support the conclusion that financial assurance is needed in the case of research reactors.
In regard to decommissioning plans, non power reactors were never exempted from submitting "dismantlement plans." The rule sets out the contents of decommissioning plans with no distinction for classes of reactors. However, the level of effort in developing plans and in the amount of material submitted will vary in practice commensurate with the level of effort required for the decommissioning. The Commission has attempted to minimize the burden of complying with these rules to the extent possible.
- 2. Waste disposal considerations related to decommissioning. A number of commenters indicated that NRC must carefully study wastes resulting from decommissioning and provide proper classification of these wastes. Commenters stated that decommissioning standards should ',nclude clear definitions of high-level (in'luding c spent fuel), low-level, and "intermediate level" wastes and consideration should be given to means of transport and proper disposal for different types of decommissioning wastes so that wastes are not placed into burial grounds for which they are not suited. Also, consideration should be given to availability of disposal capacity for the different classes of decommissioning wastes.
In particular, long lived activation products, such as Ni-59 or Nb-94, should not be classified as low-level waste nor buried at LLW disposal sites. Commenters suggested that long lived wastes and wastes containing intense emitters be classified as high level waste. Also "intermediate level" wastes containing long lived isotopes should not be buried in ;
low-level waste disposal sites. Concern was expressed by four commenters ;
i that without availability of disposal capacity there could be problems 88 Enclosure A
,, [7590-01]
with carrying out decommissioning, in particular lack of high-level waste sites could cause problems.
In response to these comments it should be noted that criteria for wastes needing to be disposed of at the time of decommissioning are con-tained in existing regulations and are beyond the scope of this rulemaking action. Disposal of spent fuel will be.via geologic repository pursuant to requirements set forth in NRC's regulation 10 CFR Part 60. Disposal of low-level wastes is covered under NRC's regulation 10 CFR Part 61.
i Because low-level wastes cover a wide range in radionuclide types and activities, 10 CFR Part 61 includes a waste classification system that establishes three classes of waste generally suitable for near-surface disposal: Class A, Class B, and Class C. This classification system .
provides for successively stricter disposal requirements so that the potential risks from disposal of each class of waste are essentially equivalent to one another. In particular, the classification system limits to safe levels the concentrations of both short- and long-lived radionuclides of concern to low-level waste disposal. The radionuclides considered in the waste classification system of 10 CFR Part 61 include long-lived activation products such as Ni-59 or Nb-94, as well as "intense emitters" such as Co-60.
Wastes exceeding Class C limits are considered to be not generally suitable for near-surface disposal, and those small quantities currently being generated are being safely stored pending development of disposal capacity. The Low-Level Radioactive Waste Policy Amendments Act of 1985 (Pub. L.99-240, approved January 15, 1986, 99 Stat. 1842) provides that disposal of wastes exceeding Class C concentrations is the responsibility i
89 Enclosure A l
[7590-01] .,
1 of the Federal government. These wastes may be considered to basically ;
correspond to the "intermediate-waste" designation suggested by commenters.
As far as decommissioning wastes are concerned, technical studies coupled with practical experience from decommissioning of small reactor units indicate that wastes from future decommissionings of large power reactors will have very similar physical and radiological characteristics to those currently being generated from reactor operations. Two of the studies performed by NRC include NUREG/CR-0130, Addendum 3, (Ref. 2) and i
NUREG/CR-0672, Addendum 2, (Ref. 3) which specifically address classifica-tion of wastes from decommissioning large pressurized water reactor (PWR) and large boiling water reactor (BWR) nuclear power stations. These studies indicate that the classification of low-level decommissioning .
wastes from power reactors will be roughly as follows:
Waste Class PWR (Vol. %) BWR (Vol. %)
A 98.0 97.5 B 1. 2 2. 0 C 0.1 0.3 Above C 0. 7 0.2 As shown, the great majority of the waste volume from decommissioning will be classified as Class A waste. Only a small fraction of the wastes will exceed Class C limits.
Transportation of decommissioning wastes will involve no additional technical considerations beyond those for transportation of existing radioactive material. Existing regulations covering transportation of radioactive material are covered under NRC regulations in 10 CFR Parts 20, -
71, and 73, and Department of Transportation regulations in 49 CFR Parts 170-189.
90 Enclosure A
- c. [7590-01]
l Disposal capacity for Class A, Class B, and Class C wastes currently exists. Development of new disposal capacity under the State compacting process is covered under the Low-Level Radioactive Waste Policy Amendments Act referenced above. This Act provides for incentives for development of such capacity, as well as penalties for failure to develop such capacity.
NRC staff expects that Congress will provide guidance for developmer.t of disposal capacity for wastes exceeding Class C concentrations. For spent fuel, which although not included as a decommissioning activity could nevertheless impact on the decommissioning schedule, a detailed schedule for development of monitored retrievable storage and geologic disposal capacity is provided in the Nuclear Waste Policy Act of 1982.
Licensees will have to assess the situation with regard to waste disposal as part of the decommissioning plan which they submit according to the requirements of 10 CFR 30.36, 40.42, 50.82, 70.38 and 72.38. In add'i tion, the rule amendments require that at or about five years prior to the projected end of operation, each reactor licensee submit a prelimi-nary decommissioning plan containing a cost estimate for decommissioning and an up-to-date assessment of the actions necessary for decommissioning.
The Supplementary Information of the proposed rule indicated that this requirement would assure that consideration be given to relevant, up-to-date information which could be important to adequate planning and funding for decommissioning well before decommissioning actually begins. These considerations include an assessment of the current waste disposal condi-l tions. If for any reason disposal capacity for decommissioning wastes !
I were unavailable, there are provisions in S 50.82 to allow delay in l l
completion of decommissioning which would permit temporary safe storage of decommissioning waste. In addition, S 50.82 contains requirements to 91 Enclosure A )
i w.r..
_ - - - - - - _ , --.,.a ,
[7590-01] ,,
ensure that adequate funding is available for completion of dalayed decommissioning.
The Supplementary Information to the proposed rule indicated that the DECON decommissioning alternative assumes availability of capacity to dispose of waste. Alternative methods of decommissioning are avail-able including delay in completion of decommissioning during which time there can be storage of wastes. Delay in decommissioning can result in a reduction of occupational dose and waste volume due to radioactive decay.
PIRG, et al., Petition for Rulemaking, Docket No. PRM-50-22.
On July 5, 1977, as supplemented October 7, 1977, and January 3, 1978 the Public Interest Research Group (PIRG), Arizonans for Safe Energy, '
Citizens United Against Radioactive Environment, Community Action Research Group, Critical Mass Energy Project, Environmental Action Foundation, Environmental Action, Inc , New Mexico Public Interest Research Group, .
New York Public Interest Research Group, North Anna Environmental Coalition, Texas Public Interest Research Group, and National Consumer Law Center Energy Project (hereinafter the ' petitioners'), petitioned the Commission to initiate rulemaking to proniulgate regulations for nuclear power plant decommissioning which would require plant operators to post bonds, to be held in escrow, to ensure that funds would be available for proper and j adequate isolation of radioactive material upon each plant's decommissioning.
On June 22, 1979, the Commission published in the Federal Register (44 FR 36523) a partial denial of the petitioners' request. In this notice the Commission specifically denied the petitioners' request to I immediately initiate rulemaking to implement a specific decommissioning funding plan that would require nuclear power plant operators to post 92 Enclosure A l l
.. ' [7590-01]
surety bonds to cover decommissioning costs. The Commission granted the petitioners' request to reconsider the adequacy of its regulations on decommissioning. The Commission indicated that other issues and funding alternatives raised by the petitioners would be considered within the context of the NRC decommissioning rulemaking proceedings.
In addition to suraty bonds, the petitioners advanced two other options to finance nuclear power reactor decommissioning: (1) funds in an amount sufficient to pay for projected decommissioning would be set aside in an escrow account before commencing reactor operations, and (2) funds would be accumulated in a sinking fund during the life of the plant supplemented by a surety arrangement as necessary to allow for the risk of a licensed utility going bankrupt before the sinking fund had accumulated sufficient funds. The petitioners indicated that the require-ments should apply to existing licensees as well as future licensees.
The petitioners also raised the issue of the Commission's jurisdiction to regulate the arrangements for decommissioning. The original petitioners joined by others, submitted comments in response to the Federal Register notice (44 FR 36523, J,.te 22, 1979). 'These comments were received on November 21, 1979. The comments discussed NRC's jurisdiction to promul-1 gate rules mandating specific requirements covering decommissioning costs, the need for NRC to establish a rule requiring its licensees to make specific financial plans to meet decommissioning costs, surety bonds as a supplementary option, and the disadvantage of unfunded alternatives.
The PIRG petition and the petitioners' supplementary comments were considered in the development of this rule. The Commission agrees that its regulations should be amended to require that licensees plan for decommissioning and provide reasonable assurance that funds will be 93 Enclosure A
[7590-01]' ..
i available to cover decommissioning costs when needed. For reasons discussed in the previous sections, the Commission does not believe it is j necessary, or desirable, to require a specific financial method for col-1ecting decommissioning funds beyond the listing in the modified proposed rule. The amendments require licensees to submit a report indicating the l level of funding and the funding method for assuring that funds will be ;
available for decommissioning. Acceptable methods are indicated in the amendments. This procedure covers all applicants for operating licenses l and existing licensees under Part 50. To the extent that the petitioners ;
i would require promulgation of a specific method for financing power reactor decommissioning, the petition is denied. To the extent that the proposed amendments would allow consideration of the petitioners' suggested financing methods, including surety bonds if they are available, the petition is granted. This action completes NRC consideration of the issues raised in PRM-50-22. -
References
- 1. Plan for Reevaluation of NRC Polict on Decommissioning of Nuclear Facilities, NUREG-0436, Revision 1. U.S. Nuclear Regulatory Commis-sion, December 1978, and Supplement 1, July 1980, and Supplement 2, March 1981.
- 2. R. I. Smith, G. J. Konzek, and W. E. Kennedy, Jr., Technoiocy, Safety, and Costs of Decommissioning a Reference Pressurized Water Reactor Power Station, NUREG/CR-0130, Prepared by Pacific Northwest Laboratory for the U.S. Nuclear Regulatory Commission, June 1978, Addendum 1, August 1979, Addendum 2, July 1983, and Addendum 3, September 1984.
- 3. H. D. Oak et al., Technology, Safety, and Costs of Decommissioning a Reference Boiling Water Reactor Power ftation, NUREG/CR-0672, Prepared by Pacific Northwest Laboratory for the U.S. Nuclear Regula-tory Commission, June 1980, Addendum 1, July 1983, and Addendum 2, September 1984.
94 Enclosure A
[7590-01]
- 4. G. J. Konzek, Technology, Safety, and Costs or Decommissioning Refer-ence Nuclear Research and Test Reactors, NUREG/CR-1756, prepared by Pacific Northwest Laboratory for the U.S. Nuclear Regulatory Commission, February 1982, and Addendum, July 1983. ,
- 5. Norm G. Wittenbrock et al., Technology, Safety, and Costs of Decom-missioning Light Water Reactors at a Multiple 9eactor Station, NUREG/
CR-1755, prepared by Pacific Northwest Laboratory for U.S. Nuclear Regulatory Commission, January 1982.
- 6. Emmett B. Moore, Jr. , Facilitation of Decommissioning of Light Water Reactors, NUREG/CR-0569, Pacific ~ Northwest Laboratory for U.S. Nuclear Regulatory Commission, December 1979.
- 7. E. S. Murphy, Technology, Safety, and Costs of Decommissioning Refer-ence Light Water Reactors Following Accidents, NUREG/CR-2601, Prepared by Pacific Northwest Laboratcry for U.S. Nuclear Regulatory Commission, November 1982.
- 8. K. J. Schneider and C. E. Jenkins, Technology, Safety, and Costs of Decommissioning a Reference Nuclear Fuel Reprocessing Plant, NUREG-0278, Prepared by Pacific Northwest Laboratory for U.S. Nuclear Regulatory Commission, October 1977.
- 9. H. R. Elder and D. E. Blahnik, Technology, Safety, and Costs of Decommissioning a Reference Uranium Fuel Fabrication Plant, NUREG/.
CR-1266,- Pacific Northwest Laboratory for U.S. Nuclear Regulatory Commission, October 1980.
- 10. H. R. Elder, Technology, Safety, and Costs of Decommissioning a Reference Uranium Hexafluoride Conversion Plant, NUREG/CR-1757, Prepared by Pacific Northwest Laboratory for U.S. Nuclear Regula-tory Commission, October 1981.
- 11. C. E. Jenkins, E. S. Murphy, and K. J. Schneider, Technology, Safety, and Costs of Decommissioning a Reference Small Mixed Oxide Fuel Fabrication Plant, NUREG/CR-0129, Prepared by Pacific Northwest Laboratory for U.S. Nuclear Regulatory Commission, February 1979.
- 12. E. S. Murphy, Technology, Safety, and Costs of Decommissioning Refer-ence Non-Fuel-Cycle Nuclear Facilities, NUREG/CR-1754, Prepared by Pacific Northwest Laboratory for U.S. Nuclear Regulatory Commission, February 1931.
- 13. J. D. Ludwick and E. B. Moore, Technology, Safety and Costs of Decom-missioning Reference Independent Spent Fuel Storage Installations, NUREG/CR-2210, Prepared by Pacific Northwest Laboratory for the U.S. Nuclear Regulatory Commission, January 1984.
- 14. Robert S. Wood, Assuring the Availability of Funds for Decommission-ing Nuclear Facilities Draft Report, NUREG-0584, Revision 3, U.S.
Nuclear Regulatory Commission, March 1983.
95 Enclosure A
[7590-01]
- 15. Financing Strategies For Nuclear Power Plant Decommissioning, NUREG/
CR-1481, Prepared by Temple, 8arker, and Sloan, Inc.,-for the New England Conferer.ce of Public Utilities Commissioners, Inc. , for U.S.
Nuclear Regulatory Commission, July 1980,
- 16. P. L. Chernick et al. , Design, Costs and Acceptability of an Elec- ,
I tric Utility Pool for Assuring the Adequacy of Funds for Nuclear Power Plant Decommissioning Expense; NUREG/CR-2370, Prepared by Analysis and Inference, Inc., for U.S. Nuclear Regulatory Commis-sion, December 1981.
- 17. C. F. Holoway and J. Witherspoon,' Monitoring for Comaliance with Decommissioning Termination Survey Criteria, NUREG/CR-2082, Prepared :
by Oak Ridge National Laboratory for the U.S. Nuclear Regulate:3y Commi sion, June 1981.
- 18. J. J. Siegel, Utility Financial Stability and the Availability of Funds for Decommissioning, NUREG/CR-3899, Prepared by Engineering and Economics Research, Inc., for the U.S. Nuclear Regulatory Commission, September 1984 and Supplement 1, April 1988.
- 19. J. P. Witherspoon, Technology and Cost of Termination Surveys Asso-ciated With Decommissioning of Nuclear Facilities, NUREG/CR-2241, Prepared by Oak Ridge National Laboratory for U.S. Nuclear Regula-tory Commission, January 1982. ,
- 20. Draft Generic Environmental Impact Statement on Decommissioning Nuclear Facilities. U.S. Nuclear Regulatory Commission, NUREG-0586, January 1981, and final Generic Environmental Impact Statement on Decommissioning Nuclear Facilities, U.S. Nuclear Regulatory Commis-sion, NUREG-0586, April 1988.
- 21. H. K. Elder, Technology, Safety and Costs of Decommissioning Refer-ence Nuclear Fuel Cycle and Non-Fuel Cycle Facilities Following Postulated Accidents, NUREG/CR-3293, Prepared by Pacific Northwest Laboratory for the U.S. Nuclear Regulatory Commission, May 1985.
- 22. H. K. Elder, Technology, Safety and Costs of Decommissioning Refer-ence Nuclear Fuel Cycle Facilities, NUREG/CR-4519, Prepared by Pacific Northwest Laboratory for the U.S. Nuclear Regulatory Commis-sion, May 1986.
- 23. J. C. Evans et al., Long-Lived Activation Products in Reactor Mate- '
rials, NUREG/CR-3474, Prepared by Pacific Northwest Laboratory for the U.S. Nuclear Regulatory Commission, August 1984.
- 24. K. H. Abel et al., Residual Radionuclide Contamination Within and Around Commercial Nuclear Power Plants, NUSEG/CR-4289, Prepared by Pacific Northwest Laboratory for the U.C aclear Regulatory Commission, February 1986.
l 96 Enclosure A
[7690-01]
- 25. T. S. LaGuardia and J. F. Risley, Identification and Evaluation of Facilitation Techniques for Decommissioning Light Water Power Reac-tors, NUREG/CR-3587, Prepared by TLG Engineering, Inc. for the U.S.
Nuclear Regulatory Commission, June 1986.
- 26. Summary, Analysis, and Response to Public Comments on Proposed Amend-ments on Decommissioning Criteria for Nuclear Facilities, NUREG-1221, U.S. Nuclear Regulatory Commission, April 1988.
NOTE: Free single copies of reference Item 14 and of the Draft Generic Environmental Impact Statement, to the extent of supply, may be obtained by writing to the Distribution Section, Document Control Branch, Division of Information Support fervices, U.S. Nuclear Regulatory Commission, Washington, DC 20555. A copy is also available for inspection and/or copying for a fee in the !!RC Public Decument Room, 1717 H Street Nr.,
Washington, DC 20555.
Copies of all other referenced documents may be purchased through the U.S. Government Printing Office by calling (202) 275-2060 or by writing to the U.S. Government Printing Office, P.O. Box 37082, Washington, DC 20013-7082. Copies may also be purchased from the National Technical Information Service, U.S. Department of Commerce, 5285 Port Royal Road, l l
Springfield, VA 22161. A copy is available for inspection or copying for i a fee in the NRC Public Document Room, 1717 H Street NW., Washington, DC 20555.
Environmental Impact Statement: Availability ;
I i
As required by the National Environmental Policy Act of 1969, as amended, and the Commission's regulations in 10 CFR Part 51, the NRC has t
97 Enclosure A
[7590-01] .,
prepared a final generic environmental impact statement on the decommis-sioning of nuclear facilities.
This final generic environmental impact statement is available for inspection and copying for a fee in the NRC Public Document Room, 1717 H Street NW., Washington, DC. Single copies of the final generic environmental impact statement may be obtained from Carl Feldman or Frank Cardile, Office of Nuclear Regulatory Research, U.S. Nuclear Regulatory Commission, Washington, DC 20555, telephone (301)492-3883.
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.).
These requirements were approved by the Office of Management and Budget ur. der aforoval numbers: Part 30-3150-0017; Part 40-3150-0020; Part 50-3150-0011; Part 70-3150-0009; and Part 72-3150-0132.
l Regulatory Analysis '
The Commission has prepared a regulatory analysis on this final regulation. The analysis examines the costs and benefits of the alter-natives considered by the Commission. The analysis is available for inspection in the NRC Public Document Room, 1717 H Street NW , Washington, DC. Single copies of the analysis may be obtained from C. Feldman, I Office of Nuclear Regulatory Research, U.S. Nuclear Regulatory Commission.
Washington, DC 20555, telephone (301)492-3883.
l 98 Enclosure A l
[7590-01]
Regulatory Flexibility Analysis As required by the Regulatory Flexibility Act of 1980, 5 U.S.C.
605(b), the NRC has carefully considered the effect on small entities in developing the final rule and has attempted to tier the requirements to reduce the impact on small entities to the extent possible while adequately protecting health and safety.
Based on the information available, it is not expected that this rule will have a significant economic impact on a substantial number of small entities. The rule broadly affects all Commission applicants and licensees and, because Agreement States will be required to maintain compatibility with the proposed changes, the rule also affects Agreement State applicants and licensees. There are approximately 9,000 Commission licenses, which include about 5,200 byproduct material licenses under
- Parts 30 through 34, 2,500 medical licenses under Part 35, 400 source material licenses under Part 40, 200 production and utilization licenses (including approximately 50 applications in various stages of review) under Part 50, 700 special nuclear material licenses under Part 70, and 1 license and approximately 5 potential applicants under Part 72. Between 11,000 and 12,000 Agreement States' licensees are also affected.
The Commission estimates that approximately 40 percent of its licensees are considered small entities under the recently adopted NRC
- size standards (51 FR 50241; December 9, 1985). The'NRC size standards for entities to be considered as small businesses are as follows
- For mos,t licensees, annual billings of $3.5 million or less
- For private practice physicians, annual billing of $1 million or less 4
99 Enc 15sureA t
, c.,
[7590-01) ,
. i t
- For State or public education institutions, the institution is supported by a jurisdiction with a population of 50,000 or less .
- For other educational institutions, the institution has 500 or fewer employees.
Licensees under 10 CFR Parts 50 and 72 are not considered small entities.
1 All licensees including small entities will be required to keep records important to decommissioning. In general, for small licensees, such recordkeeping is "good practice" and should not constitute a signif-icant change in operation. Generally, keeping records important to decommissioning reduces both the costs and health and safety impacts of decommissioning and can also result in savings in doses or costs during operation. Costs of recordkeeping would tend to be recouped either in operation or at decommissioning.
The changes contained in this rule at the time of termination of license affect few small entities. These changes consist primarily of specifying in more detail contents of decommissioning plans, presently called "decontamination plans" in 10 CFR Parts 30, 40, and 70. Although more detailed plans may be required than have been considered acceptable in the past, there will also be a' reduction in administrative effort because there will be less uncertainty as to what is expected. Overall, these changes are not expected to have a significant impact.
The most significant impact of this rule on licensees is likely to result from the financial assurance requirements. A cost estimate for decommissioning and'a method of providing assurance of funds for decom-missioning will be required of roughly 830 Commission licensees of which i
100 '
Enclosure A
[7590-01]
few if any will be small entities. Roughly another 660 Commission licen-sees including about 280 small entities will have the option of providing j financial assurance in a proscribed amount and submitting a certification to that effect or submitting a funding plan to support a lower amount. A i similar number of Agreement State licensees would also be affected. Those small entities affected would be almost exclusively industrial licensees.
Because the historical information indicates that small industrial licen-f sees are the most likely to default, it is particularly important that financial assurance be provided by these licensees. The rule allows as much flexibility as possible to licensees for providing financial assur-ance, in order to reduce the impact. Also, the economic impact of making cost estimates can be reduced by using the data base which has been developed.
The cost of this requirement depends on the method used. A surety or insurance method is likely to be used by small entities; it is esti-mated to cost approximately 1 to 2% of the face value, or 1 to 2% of decommissioning costs annually, plus the administrative cost of either developing a cost estimate and reporting on the funding methods to NRC or of making a certification. The cost of a surety using the prescribed amounts proposed in the rule would thus be in the range of $500 - $10,000 4
per year. For a few smal entities affected this would be a significant economic impact, however, these cases would present the highest risk of default.
A more detailed analysis of impacts to small entities is included in the Regulatory Analysis.
?
. 101 Enclosure A
(7590-01),,
Backfit Analysis ;
The Commission has determined, on the basis of the record in this rulemaking, that the backfits which will be imposed as a result of this rule are necessary to ensure the adequate protection of public health and safety. Therefore, under section (a)(3) of the backfit rule, 10 CFR 50.109, neither a backfit analysis nor, application of the backfit rule's cost-benefit standards is required for this rule. The regulatory analysis of these amendments constitutes the documented evaluation required by section (a)(4) of the backfit rule. This analysis contains the objectives of, and reasons for, the backfits entailed by these amendments and provides the basit for claiming that these backfits are necessary to ensure adequate protection to public health and safety.
List of Subjects Part 30 - Byprodu:t material, Government contracts, Intergovern-r 4
mental relations, Isotopes, Nuclear materials, Penalty, Radiation pro-
- tection, Reporting and recordkeeping requirements.
Part 40 - Government contracts, Hazardous materials - transportation, Nuclear materials, Penalty, Reporting and recordkeeping requirements, Scurce material, Uranium.
Part 50 - Antitrust, Classified information, Fire prevention, Incorporation by reference, Intergovernmental relations, Nuclear power !
plants and reactors, Penalty, Radiation protection, Reactor siting i criteria, Reporting and recordkeeping requirements.
102 Enclosure A '
i J
[7590-01]
Part 51 - Administrative practice and procedure, Environmental impact statement, Nuclear materials, Nuclear power plants and reactors, Reporting and recordkeeping requirements.
Part 70 - Hazardous materials - transportation, Nuclear materials, Packaging and containers, Penalty, Radiation protection, Reporting and recordkeeping requirements, Scient.ific equipment, Security measures, Special nuclear material.
Part 72 - Manpower training programs, Nuclear materials, Occupational safety and health, Reporting and recordkeeping requirements, Security measures, Spent fuel.
For the reasons set out in the preamble and under the authority of the Atomic Energy Act of 1954, as amended, the Energy Reorganization Act ;
of 1974, as amended, and 5 U.S.C. 552 and 553, the NRC is adopting the following amendments to 10 CFR Part's 30, 40, 50, 51, 70, and 72.
PART 30 - RULES OF GENERAL APPLICABILITY TO DOMESTIC LICENSING OF BYPRODUCT MATERIAL
- 1. The authority citation for Part 30 is revised to read as follows:
AUTHORITY: Secs. 81, 32, 161, 182, 183, 186, 68 Stat. 935, 948, 953,
! 954, 955, as amended, sec. 234, 83 Stat. 444, as amended (42 U.S.C. 2111, 2112, 2201, 2232, 2233, 2236, 2282); secs 201, as amended, 202, 206, 88 Stat. 1242, as amended, 1244, 1246 (42 U.S.C. 5841, 5842, 5846).
Section 30.7 also issued under Pub. L.95-601, sec. 10, 92 Stat.
2951 (42 U.S.C. 5851). Section 30.34(b) also issued under sec. 184, 68 Stat. 954, as amended (42 U.S.C. 2234). Section 30.61 also issued under sec. 187, 68 Stat. 955 (42 U.S.C. 2237).
~
103 Enclosure A
[7590-01) -
l For the purposes of sec. 223, 68 Stat. 958, as amended (42 U.S.C.
2273), SS 30.3, 30.34(b) and (c), 30.41(a) and (c), and 30.53 are issued under sec. 161b, 68 Stat. 948, as amended (42 U.S.C. 2201(b)); and SS 30.6, 30.9, 30.36, 30.51, 30.52, 30.55, and 30.56(b) and (c) are issued under sec. 161o, 68 Stat. 950, as amended (42 U.S.C. 2201(o)).
- 2. Section 30.4 is amended by adding a new paragraph (aa) to read as follows:*
$ 30.4 Definitions.
(aa) "Decommission" means to remove (as a facility) safely from service and reduce residual radioactivity to a level that permits release of the property for unrestricted use and termination of license.
- 3. Section 30.32 is amended by adding a new paragraph (h) to read as follows:
6 30.32 Application for specific licenses.
A A A A A (h) As provided by S 30.35, certain applications for specific licenses filed under this part and Parts 32 through 35 of this chapter must contain a proposed decommissioning funding plan or a certification of financial assurance for decommissioning. In the case of renewal applications submitted before* this submittal may follow the renewal application but must be submitted on or before* .
"Blank space is left here and in similar later places in the rule text.
The appropriate date will be inserted before publication in the Federal Register.
I 104 Enclosure A
- 4. A new $ 30.35 is added to read as follows:
S 30.35 Financial assurance and recordkeeping for decommissioning, j (a) Each applicant for a specific license authorizing the possession !
and use of unsealed byproduct-material of half-life greater than 120 days and in quantities exceeding 105 times the applicable quantities set forth a
in Appendix C to 10 CFR 20 shall submit.a decommissioning funding plan as
! described in paragraph (e) of this.section. The decommissioning funding plan must also be submitted when a combination of isotopes is involved ;
if R divided by 105 is greater than 1 (unity rule), where R is defined here as the sum of the ratios of the quantity of each isotope to the t applicable value in Appendix C.
(b) Each applicant for a specific license authorizing possession q and use of byproduct material of half-life greater than 120 days and in i
] quantities specified in paragraph (d) of this section shall either-- L (1) Submit a decommissioning funding plan as described in para-i graph (e) of this section; or r
l (2) Submit a certification that financial assurance for decommis- :
sioning has been provided in the amount prescribed by paragraph (d) of ;
this section using one of the methods described in paragraph (f) of this t
section. For an applicant, this certifichtion may state that the appro- i
- t priate assurance will be obtained after the application has been approved ;
- and the license issued but prior to the receipt of licensed material. l l As part of the certification, a copy of the financial instrument obtained 9
to satisfy the requirements of paragraph (f) of this section is to be )
submitted to NRC, ,
1 i
i :
i i 105 Enclosure A I 1
[7590-01] I l
(c)(1) Each holder of a specific license issued on or after which is of a type described in paragraph (a) or (b) of this section, shall provide financial assurance for decommissioning in accor- f dance with the criteria set forth in this section.
(2) Each holder of a specific license issued before and of a type described in paragraph (a) of this section shall submit, on or before , a decommissioning funding plan or a certifi-cation of financial assurance for decommissioning in an amount at least equal to $750,000 in accordance with the criteria set forth in this section. If the licensee submits the certification of financial assur-ance rather than a decommissioning funding plan at this time, the licen-see shall include a decommissioning funding plan in any application for license renewal.
(3) Each holder of a specific license issued before and of a type described in' paragraph (b) of this section shall submit, on or before , a certification of financial assurance for decommissioning or a decommissioning fundiry plan in accordance with the criteria set forth in this section.
(d) Table of required amounts of financial assurance for decommis-sioning by quantity of material, greater than 104 but less than or $750,000 equal to 105 times the applicable quantities of Appendix C of Part 20 in unsealed form. (For a combination .
of isotopes, if R, as defined in S 30.35(a), divided by 104 is greater than 1 but R divided by 105 is less than or equal to 1.)
106 Enclosure A I
e- [7590-01]
O greater than 103 but less than or equal $150,000 to 104 times the applicable quantities of Appendix C of Part 20 in unsealed form. (For a combination of isotopes, if R, as defined in S 30.35(a), divided, by 103 is greater than 1 but R divided by 104 is less than or equal to 1.)
greater than 1010 times the applicable $75,000 quantities of Appendix C of Part 20 in sealed sources or plated foils. (For a combination of isotopes, if R, as defined in S 30.35(a), divided by 1010 is greater than 1).
(e) Each decommissioning funding plan must contain a cost estimate for decommissioning and a description of the method of assuring funds for decommissioning from paragraph (f) of this section, including means of adjusting cost estimates and associated funding levels periodically over the life of the facility.
(f) Financial assurance for decommissioning must be provided by one or more of the following methods:
(1) Prepayment. Prepayment is the deposit prior to the start of operation into an account segregated from licensee assets and outside the licensee's administrative control of cash or liquid assets such that the amount of funds would be sufficient to pay decommissioning costs.
Prepayment may be in the form of a trust, escrow account, government fund, certificate of deposit, or deposit of government securities.
(2) A surety method, insurance, or other guarantee method. These methods guarantee that decommissioning costs will be paid should the licensee default. A surety method may be in the form of a surety bond, letter of credit, or line of credit. A parent company guarantee of funds for decommissioning costs based on a financial test may be used if the guarantee and test are as contained in Appendix A to this part. A parent s
107 Enclosure A
[7590-01] ..
company guarantee may not be used in combination with other financial methods to satisfy the requirements of this section. Any surety method or insurance used to provide financial assurance for decommissioning must contain the following conditions:
(i) The surety method or insurance must be open-ended or, if written for a specified term, such as five years, must be renewed automatically unless 90 days or more prior to the renewal date, the issuer notifies the Commission, the beneficiary, and the licensee of its . intention not to 1
renew. The surety method or insurance must also provide that the full face amount be paid to the beneficiary automatically prior to the expiration without proof of forfeiture if the licensee fails to provide a replacement acceptable to the Commission within 30 days after receipt of notification of cancellation.
(ii) The surety method or insurance must be payable.to a trust established for decommissioning costs. The trustee and trust must be acceptable to the Commission. An acceptable trustee includes an appro-priate State or Federal government agency or an entity which has the authority to act as a trustee and whose trust operations are regulated i
and examined by a Federal or State agency.
(iii) The surety method or insurance must remain in effect until the Commission has terminated the license. i (3) An external sinking fund in which deposits are made at least annually, coupled with a surety method or insurance, the value of which may decrease by the amount being accumulated in the sinking fund. An external sinking fund is a fund established and maintained by setting aside funds periodically in an account segregated from licensee assets and outside the licensee's administrative control in which the total amount 108 Enclosure A
,, [7590-01]
of funds would be sufficient to pay decommissioning costs at the time termination of operation is expected. An external sinking fund may be in the form of a trust, escrow account, government fund, certificate of deposit, or deposit of government securities. The surety or insurance provisions must be as stated in paragraph (f)(2) of this section.
(4) In the case of Federal, State, or local government licensees, a statement of intent containing a cost estimate for decommissioning or -
an amount based on the Table in paragraph (d) of this section, and indi-cating that funds for decommissioning will be obtained when necessary.
(g) Each person licensed under this part or Parts 32 through 35 of this chapter shall keep records of information important to the safe and effective decommissioning of the facility in an identified location until the license is terminated by the Commission. If records of relevant in-formation are kept for other purposes, reference to these records and their locations may be used. Information the Commission considers impor-tant to decommissioning consists of--
(1) Records of spills or other unusual occurrences involving the spread of contamination in and around the facility, equipment, or site.
These records may be limited to instances when contamination remains after any cleanup procedures or when there is reasonable likelihood thtt con-taminants may have spread to inaccessible areas as in the case of possible d
seepage into porous materials such as concrete. These records must include any known information on identification of involved nuclides, quantities, forms, and concentrations.
(2) As-built drawings and modifications of structures and equipment in restricted areas where radioactive materials are used and/or stored, )
I and of locations of possible inaccessible contamination such as buried
, n 109 Enclosure A
' l l
l
- ^
[7590-01] -
pipes which may be subject to contamination. If required drawings are referenced, each relevant document need not be indexed individually. If drawings are not available, the licensee shall substitute appropriate records of available information concerning these areas and locations.
(3) Records of the cost estimate performed for the decommissioning funding plan or of the amount certified for decommissioning, and records of the funding method used for assuring funds if either a funding plan or certification is used.
- 5. Section 30.36 is revised to read as follows:
S 30.36 Expiration and termination of licenses.
(a) Except as provided in S 30.37(b) and paragraph (e) of this sec- ,
tion, each specific license expires at the end of the day, in the month and year stated in the license.
(b) Each licensee shall notify the Commission promptly, in writing ;
under S 30.6, and request termination of the license when the licensee decides to terminate all activities involving materials authorized under the license. This notification and request for termination of the license must include the reports and information specified in paragraphs (c)(1)(iv) {
and (v) of this section and a plan for completion of decommissioning if required by paragraph (c)(2) of this section or by license condition.
(c)(1) If a licensee does not submit an application for license renewal under S 30.37, the licensee shall on or before the expiration j date specified in the' license -
110 Enclosure A
[7590-01)
(i) Terminate use of byproduct material; (ii) Remove radioactive contamination to the extent practicable exccpt for those procedures covered by paragraph (c)(2)(i) of this section; (iii) Properly dispose of byproduct material;
- (iv) Submit a completed form NRC-314, which certifies information concerning the disposition of materials; and (v) Conduct a radiation survey of the premises where the licensed activities were carried out and submit a report of the results of this survey, unless the licensee demonstrates that the premises are suitable for release for unrestricted use in some other manner. The licensee
]
shall, as appropriate -
(A) Report levels of radiation in units of microrads per hour of beta and gamma radiation at one centimeter and gamma radiation at one meter from surfaces, and report levels of radioactivity, including alpha, in units of disintegrations per minute (or microcuries) per 100 square I centimeters removable and fixed for surfaces, microcuries per milliliter 4
for water, and picocuries per gram for solids such as soils or concrete; and (B) Specify the survey instrument (s) used and certify that each ,
instrument is properly calibrated and tested.
(2)(i) In addition to the information required under paragraphs (c)(1)(iv) and (v) of this section, the licensee shall submit a plan for completion of decommissioning if the procedures necessary to carry out i
decommissioning have not been previously approved by the NRC and could f increase potential health and safety impacts to workers or to the public such as in any of the following cases:
)
i
' I 111 Enclosure A
[7590-01) l (A) Procedures would involve techniques not applied routinely during cleanup or maintenance operations; or (B) Workers would be entering areas not normally occupied where surface contamination and radiation levels are significantly higher than routinely encountered during operation; or (C) Procedures could result in significantly greater airborne concentrations of radioactive materials than are present during operation; or (D) Procedures could result in significantly greater releases of radioactive material to the environment than those associated with operation.
(ii) Procedures with potential health and safety impacts may not be carried out prior to approval of the decommissioning plan.
(iii) The proposed decommissioning plan, if required by paragraph (c)
(2)(i) of this section or by license condition, must include--
(A) Description of planned decommissioning activities; (B) Description of methods used to assure protection of workers and the environment against radiation hazards during decommissioning; (C) A description of the planned final radiation survey; and (D) An updated detailed cost estimate for decommissioning, compar-ison of that estimate with present funds set aside for decommissioning, and plan for assuring the availability of adequate funds for completion of decommissioning.
(iv) The proposed decommissioning plan will be approved by the Commission if the information therein demonstrates that the decommission-ing will be completed as soon as is reasonable and that the health and safety of workers and the public will be adequately protected.
112 Enclosure A
.." [7590-01)
(3) Upon approval of the decommissioning plan by the Commission, the licensee shall complete decommissioning in accordance with the approved plan. As a final step in decemmissioning, the licensee shall again s'ubmit the information required in paragraph (c)(1)(v) of this section and shall certify the disposition of accumulated wastes from decommissioning.
(d) If the information submitted under paragraphs (c)(1)(v) or (c)(3) of this section does not adequately demonstrate that the premises are suitable for release for unrestricted use, the Commission will inform the licensee of the appropriate further actions required for termination of license.
(e) Each specific license continues in effect, beyond the expiration date if necessary, with respect to possession of residual byproduct mate-rial present as contamination until the Commission notifies the licensee in writing that the license is terninated. During this time, the licensee shall--
(1) Limit actions involving byproduct material to those related to decommissioning; and (2) Continue to control entry to restricted areas until they are suitable for release for unrestricted use and the Commission notifies the licensee in writing that the license is terminated.
(f) Specific licenses will be terminated by written notice to the licensee when the Commission determines that--
(1) Byproduct material has been properly disposed; (2) Reasonable effort has been made to eliminate residual radio-active contamination, if present; and I
(3)(i) A radiation survey has been performed which demonstrates I that the premises are suitable for release for unrestricted use; or 113 Enclosure A
i
[7590-01) ,,
l (ii) Other information submitted by the licensee is sufficient to i
demonstrate that the premises are suitable for release for unrestricted i
use.
- 6. A new Appendix A is added to Part 30 to read as follows:
APPENDIX A CRITERIA RELATING TO USE OF FINANCIAL TESTS AND PARENT l
COMPANY GUARANTEES FOR PROVIDING REASONABLE ASSURANCE 0F FUNDS FOR DECOMMISSIONING I. Introduction.
An applicant or licensee may provide reasonable assurance of the availability of funds for decommissioning based on obtaining a parent company guarantee that funds will be'available for decommissioning costs and on a demonstration that the parent company passes a financial test.
This appendix establishes criteria for passing the financial test and for obtaining the parent company guarantee.
II. Financial Test.
A. To pass the financial test, the parent company must meet the ,
criteria of either paragraph A.1 or A.2 of this section:
- 1. The parent company must have:
(i) Two of the following three ratios: a ratio of total liabilities to net worth less than 2.0; a ratio of the sum of cet income plus deprecia-tion, depletion, and amortization to total liabilities greater than 0.1; and a ratio of current assets to current liabilities greater than 1.5; and
~
114 Enclosure A
,, [7590-01). ,
(ii) Net working capital and tangible net worth each at least six times the current decomissioning cost estimates (or prescribed amount if a certification is used); and 1
(iii) Tangible net worth of at least $10 million; and (iv) Assets located in the United States amounting to at least 90
- percent of total assets or at least six. times the current decommissioning cost estimates (or prescribed amount if a certification is used).
- 2. The parent company must have-(i) A current rating for its most recent bond issuance of AAA, AA, A, or BBB as issued by Standard and Poor's or Aaa, Aa, A, or Baa as issued by Moody's; and j (ii) Tangible net worth at least six times the current decommission-1 l ing cost estimate (or prescribed amount if a certification is used); and (iii) Tangible net worth of at least $10 million; and (iv) Assets located in the United States amounting to at least ,
90 percent of total assets or at least six times the current decommis-sioning cost estimates (or prescribed amount if certification is used). '
J B. The parent company's independent certified public accountant must have compared the data used by the parent company in the financial
] test, which is derived from the independently audited, year end financial 1
statements for the latest fiscal year, with the amounts in such financial statement. In connection with that procedure the licensee shall inform !
NRC within 90 days of any matters coming to the auditor's attention which i
j cause the auditor to believe that the data specified in the financial 1 test should be adjusted and that the company no longer passes the test. l Y l l
- I
! l 1~
1 l
115 Enclosure A
4 .
- t. C. 1. After the initial financial test, the parent company must
~
i l
repeat the passage of the test within 90 days after the close of each i succeeding fiscal year. !
i
- 2. If the parent company no longer meets the requirements of para-
! graph A of this section, the licensee must send notice to the Commission I
r of intent to establish alternate financial assurance as specified in the ,
e Commission's regulations. The notice must be sent by certified mail within 90 days after the end of the fiscal year for which the year end h financial data show that the parent company no longer meets the financial test requirements. The licensee must provide alternate financial assurance within 120 days after the end of such fiscal year.
III. Parent Company Guarantee.
4 The terms of a parent company guarantee which an applicant or licensee obtains must provide that: .
A. The parent company guarantee will remain in force unless the guarantor sends notice of cancellation by certified mail to the licensee f and the Commission. Cancellation may not occur, however, during the 120 l days beginning on the date of receipt of the notice of cancellation by -
! both the licensee and the Commission, as evidenced by the return j receipts, i
- B. If the licensee fails to provide alternate financial assurance i
5 as specified in the Commission's regulations within 90 days after receipt !
a a
by the licensee and Commission of a notice of cancellation of the parent company guarantee from the guarantor, the guarantor will provide such
- alternative financial assurance in the name of the licensee.
I 1
116 Enclosure A ;
3
.. ' [7590-01) !
!I C. The parent company guarantee and financial test provisions must remain in effect until the Commission has terminated the license. l
- 0. If a trust is est'ablished for decommissioning costs, the
- trustee and trust must be acceptable to the Commission. An acceptable trustee includes an appropriate State or Federal Government agency or an j entity which has the authority to act as a trustee and whose trust 4
operations are regulated and examined by a Federal or State agency. ,
PART 40 - DOMESTIC LICENSING OF SOURCE MATERIAL 1
- 7. The authority citation for Part 40 is revised to read as 3
follows:
AUTHORITY: Secs. 62, 63, 64, 65, 81, 161, 182, 183, 186, 68 Stat. !
932,'933, 935, 948, 953, 954, 955, as amended, secs. 11e(2), 83, 84, ;
Pub. L.95-604, 92 Stat. 3033, as amended, 3039, sec. 234, 83 Stat. 444, 4
as amended (42 U.S.C. 2014(e)(2)), 2092, 2093, 2094, 2095, 2111, 2113, 2114, 2201, 2232, 2233, 2236, 2282); sec. 274, Pub. L.86-373, 73 Stat. f i
688 (42 U.S.C. 2021); secs. 201, as amended, 202, 206, 88 Stat. 1242, !
l as amended, 1244, 1246 (42 U.S.C. 5841, 5842, 5846); Sec. 275, 92 Stat. i j
l l 3021, as amended by Pub. L.97-415, 96 Stat. 2067 (42 U.S. 2022). 1 j Section 40.7 also issued under Pub. L.95-601, sec.10, 92 Stat. ;
2951 (42 U.S.C. 5851). Section 40.31 (g) also issued under sec. 122, 68 Stat. 939 (42 U.S.C. 2152). Section 40.46 also issued under sec. 184.,
68 Stat. 954, as amended (42 U.S.C. 2234). Section 40.71 also issued 4
under sec. 187, 68 Stat. 955 (42 U.S.C. 2237).
For the purposes of sec. 223, 68 Stat. 958, as amended (42 U.S.C. i 2273); SS 40.3, 40.25(d)(1)-(3), 40.35(a)-(d), 40.41(b) and (c), 40.46, 1 s l
) 117 Enclosure A i
[7590-01] ,,
j
. r 40.51(a) and (c), and 40.63 are issued under sec. 161b, 68 Stat. 948, as amended, (42 U.S.C. 2201(b)); and SS 40.5,40.9,40.25(c),(d)(3), ,
and (4), 40.26(c)(2), 40.35(e), 40.42, 40.61, 40.62, 40.64, and 40.65 are issued under sec. 161o, 68 Stat. 950, as amended (42 U.S.C. 2201(o)). !
- 8. Section 40.4 is amended by adding a new paragraph (s) to read !
as follows:
i S 40.4 Definitions. '
A A A A A (
(s) "Decommission" means to remove (as a facility) safely from l service and reduce residual radioactivity to a level that permits release of the property for unrestricted use and termination of license.
- 9. Section 40.31 is amended by adding a new paragraph (i) to read as follows:
S 40.31 Applications for spec.i'ic licenses. !
n A A =
- i (i) As provided by S 40.36, certain applications for specific licenses filed under this part must contain a proposed decommissioning ;
funding plan or a certification of financial assurance for decommission-ing. In the case of renewal applications submitted before this sub-mittal may follow the renewal application but must De submitted on i or before .
i l
I l
118 Enclosure A !
l
_ ____. b
.. [7590-01]
- 10. A new $ 40.36 is added to read as follows:
$ 40.36 Financial assurance and recordkeeping for decommissioning.
Except for licenses authorizing the receipt, possession, and use of l source material for uranium or thorium milling, or byproduct material at sites formerly associated with such milling, for which financial assurance requirements are set forth in Appendix A of this part, criteria for pro-viding financial assurance for decommissioning are as follows:
i
- (a) Each applicant for a specific license authorizing the posses- l sion and use of more than 100 mci of source material in a readily dispers-
, ible form shall submit a decommissioning funding plan as described in paragraph (d) of this section.
(b) Each applicant for a specific license authorizing possession and ;
1 use of quantities of source material greater than 10 mci but less than or ,
i l equal to 100 mci in a readily dispersible form shall either--
I (1) Submit a decommissioning funding plan as described in para-j graph (d) of this section; or l (2) Submit a certification that financial assurance for decommis- I 4
) sioning has been provided in the amount of $150,000 using one of the i
] methods described in paragraph (e) of this section. For an applicant, ;
r
- this certification may state that the appropriate assurance will be ob-1 i j tained after the application has been approved and the license issued but !
l prior to the receipt of licensed material. As part of the certification, !
a copy of the financial instrument obtained to satisfy the requirements i of paragraph (e) of this section is to be submitted to NRC.
4 i [
i l
i l
i j !
119 Enclosure A ;
l
^ ~
(7590-01} .. !
~
(c)(1) Each holder of a specific license issued on or after l
{ which is covered by paragraph (a) or (b) of this section, shall 1
i, provide financial assurance for decommissioning in accordance with the l 1 !
q criteria set forth in this section.
I (2) Each holder of a specific license issued before i
and covered by paragraph (a) of this section shall submit, on or l before , a decommissioning funding plan or certification i of financial assurance for decommissioning in an amount at least equal to
't
] $750,000 in accordance with the criteria set forth in this section. If the licensee submits the certification of financial assurance rather than !
a decommissioning funding plan at this time, the licensee shall include a decommissioning funding plan in any application for license renewal.
h (3) Each holder of a specific license issued before !
and covered by paragraph (b) of this section shall submit, on or before f
, a certification of financial assurance for decommission-
{
ing or a decommissioning funding plan in accordance with the criteria set !
- forth in this section. "
(d) Each decommissioning funding plan must contain a cost estimate j
1 for decommissioning and a description of the method of assuring funds for i decommissioning from paragraph (e) of this section, including means of adjusting cost estimates and associated funding levels periodically over l l i the life of the facility.
(e) Financial assurance for decommissioning must be provided by i i
n
] one or more of the following methods: '
1 (1) Prepayment. Prepayment is the deposit prior to the start of I
, (
operation into an account segregated from licensee assets and outside the
,i 1 i
licensee's administrative control of cash or liquid assets such that the {
i i
i 120 Enclosure A i t
(7590-01]
amount of funds would be sufficient to pay decommissioning costs. Pre-payment may be in the form of a trust, escrow account, government fund, certificate of deposit, or deposit of government securities.
(2) A surety method, insurance, or other guarantee method. These methods guarantee that decommissioning costs will be paid should the licensee default. A surety method may be in the form of a surety bond, i l
letter of credit, or line of credit. A parent company guarantee of funds for decommissioning costs based on a financial test may be used if the guarantee and test are as contained in Appendix A of 10 CFR Part 30. A parent company guarantee may not be used in combination with other finan-cial methods to satisfy the requirements of this section. Any surety I method or insurance used to provide financial assurance for decommission-ing must contain the following conditions:
(i) The surety method or insurance must be open-ended or, if written for a specified term, such as five years, must be renewed auto-matica11y unless 90 days or more prior to the renewal date, the issuer notifies the Commission, the beneficiary, and the licensee of its inten-tion not to renew. The surety method or insurance must also provide that the full face amount be paid to the beneficiary automatically prior to the expiration without proof of forfoiture if the licensee fails to provide a replacement acceptable to the Commission within 30 days after receipt of notification of cancellation.
l (ii) The surety method or insurance must be payable to a trust
, established for decommissioning costs. The trustee and trust must be acceptable to the Commission. An acceptable trustee includes an appro-priata State or Federal government agency or an entity which has the l
121 Enclosure A
(7590-013
)
authority to act as a trustee and whose trust operations are regulated i l
- and examined by a Federal or State agency. ;
(iii) The surety method or insurance must remain in effect until the a
Commission has terminated the license. ,
(3) An external sinking fund in which deposits are made at least annually, coupled with a surety method or insurance, the value of which may decrease by the amount being accumulated in the sinking fund. An external sinking fund is a fund established and maintained by setting 1
^
i aside funds periodically in an account segregated from licensee assets l l
and outside the licensee's administrative control 1,1 which the total amount of funds would be sufficient to pay decommissioning costs at the time termination of operation is expected. An external sinking fund may be in the form of a trust, escrow account, government fund, certificate of deposit, or deposit of government securities. The surety or insurance provision must be as stated in paragraph (e)(2) of this section.
i (4) In the case of Federal, State, or local government licensees, a statement of intaint containing a cost estimate for decommissioning or
, an amount based on paragraph (b) of this section, and indicating that
)
4 funds for decommissioning will be obtained when necessary. l l (f) Each person licensed under this part shall keep records of 1
j information important to the safe and effective decommissioning of the :
j facility in an identified location until the license is terminated by the ;
i.
Commission. If records of relevant information are kept for other pur- l i
poses, reference to these records and their locations may be used. Infor- {
- mation the Commission considers important to decommissioning consists i j of--
l 1
i 122 Enclosure A :
'.. [7590-01]
(1) Records of spills or other unusual occurrences involving the spread of contamination in and around the facility, equipment, or site.
These records may be limited to instances when contamination remains after any cleanup procedures or when there is reasonable likelihood that contam-inants may have spread to inaccessible areas as in the case of possible seepage into porous materials such as. concrete. These records must include any known information on identification of involved nuclides, quantities, forms, and concentrations.
(2) As-built drawings and modifications of structures and equipment in restricted areas where radioactive materials are used and/or stored, and of locations of possible inaccessible contamination such as buried pipes which may be subject to contamination. If required drawings are referenced, each relevant document need not be indexed individually. If drawings are not available, the licensee shall substitute appropriate records of available information concerning these areas and locations.
(3) Records of the cost estimate performed for the decommissioning funding plan or of the amount certified for decommissioning, and records of the funding method used for assuring funds if either a funding plan or certification is used.
- 11. Section 40.42 is revised to read as follows:
6 40.42 Expiration and termination of licenses.
(a) Except as provided in S 40.43(b) and paragraph (e) of this sec-tion, each specific license expires at the end of the day, in the month and year stated in the license.
(b) Each licensee shall notify the Commission promptly, in writing under 9 40.5, and request termination of the license when the licensee 123 Enclosure A
[7590-01] ,,
l decides to terminate all activities involving materials authorized under the license. This notification and request for termination of the license must include the reports and information specified in paragraphs (c)(1)(iv) and (v) of this section and a plan for completion of decommis-sioning, if required by paragraph (c)(2) of this section or by license condition.
(c)(1) If a licensee does not submit an application for license renewal under S 40.43, the licensee shall on or before the expiration date specified in the license--
(i) Terminate use of source material; (ii) Remove radioactive contamination to the extent practicable except for those procedures covered by paragriph (c)(2)(i) of this section; (iii) Properly dispose of source material; (iv) Submit a completed form NRC-314, which certifies information concerning the disposition of materials; and (v) Conduct a radiation survey of the premises where the licensed activities were carried out and submit a report of the results of this survey, unless the licensee demonstrates that the premises are suitable for release for unrestricted use in some other manner. The licensee shall, as appropriate--
(A) Report levels of radiation in units of microrads per hour of beta and gamma radiation at one centimeter and gamma radiation at one 3eter from surfaces, and report levels of radioactivity, including alpha, in units of disintegrations per minute (or microcuries) per 100 square 124 Enclosure A l
[7590-01]
centimeters removable and fixed for surfaces, microcuries per milliliter for water, and picocuries per gram for solids such as soils or concrete; and (B) Specify the survey instrument (s) used and certify that each instrument is properly calibrated and tested.
(2)(i) In addition to the information required under paragraphs (c)(1)(iv) and (v) of this section, the licensee shall submit a plan for completion of decommissioning if the procedures necessary to carry out decommissioning have not been previously approved by the NRC and could increase potential health and safety impacts to workers or to the public such as in any of the following cases:
(A) Procedures would involve techniques not applied routinely during cleanup or maintenance operations; or (B) Workers woul- entering areas not normally occupied where surface contamination and radiation levels are significantly higher than routinely encountered during operation; or (C) Procedures could result in significantly greater airborne concentrations of radioactive materials than are present during opera-tion; or (D) Procedures could result in significantly greater releases of radioactive material to the environment than those associated with operation.
(ii) Procedures with potential health and safety impacts may not be carried out prior to approval of the decommissioning plan.
(iii) The proposed decommissioning plan, if required by paragraph (c)
(2)(i) of this section or by license condition, must include--
125 Enclosure A
[7590-01) .,
l' (A) Description of planned decommissioning activities; (B) Description of methods used to assure protection of workers and the environment against radiation hazards during decommissioning; (C) A description of the planned final radiation survey; and (D) An updated detailed cost estimate for decommissioning, compar-ison of that estimate with present funds set aside for decommissioning, and plan for assuring the availability of adequate funds for completion' of decommissionir.g.
(iv) The proposed decommissioning plan will be approver. by the Commis-sion if the information therein demonstrates that the decommissioning will be completed as soon as is reasonable and that the health and safety of workers and the public will be adequately protected.
(3) Upon approval of the decommissioning plan by the Commission, the licensee shall complete decommissioning in agcordance with the approved plan. As a final step in decommissioning, the licensee shall again submit the information required in paragraph (c)(1)(v) of this section and shall certify the disposition of accumulated wastes from decommissioning.
(d) If the information submitted under paragraphs (c)(1)(v) or (c)(3) of this section does not adequately demonstrate that the premises are suitable for release for unrestricted use, the Commission will inform the licensee of the appropriate further actions required for termination !
of license.
(e) Each specific license continues in effect, beyond tha expiration date if necessary, with respect to possession of residual source material present as contamination until the Commission notifies the licensee in writing that the license is terminated. During this time, the licensee shall--
126 Enclosure A
.. [7590-01]
- 1. ,
(1) Limit actions involving source material to those related to decommissioreing; and (2) Continue to control entry to restricted areas until they are suitable for release for unrestricted use and the Commission notifies the licensee in writing that the license is terminated.
(f) Specific licenses will be terminated by written notice to the licensee when the Commission determines that--
(1) Source material has been properly disposed; (2) Reasonable effort has been made to eliminate residual radio-active contamination, if present; and (3)(i) A radiation survey has been performed which demonstrates that the premises are suitable for release for unrestricted use; or (ii) Other information submitted by the licensee is sufficient to demonstrate that the premises are suitable for release for unrestricted use.
PART 50 - DOMESTIC LICENSING OF PRODUCTION AND UTILIZATION FACILITIES
- 12. The authority citation for Part 50 is revised 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. 1244, 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).
127 Enclosure A
[7590-01] ..
l 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. 4332). Sections 50.23, 50.35, 50.55, and 50.56 also issued under sec. 185, 68 Stat. 955 (42 U.S.C. 2235). Sec-tions 50.33a, 50.55a and Appendix Q also issued under sec. 102, Pub. L.91-190, 83 Stat. 853 (42 U.S.C. 4332). Sections 50.34 and 50.54 also issued under sec. 204, 88 Stat. 1245 (42 U.S.C. 5844). E tions 50.58, 50.91, and 50.92 also issued under Pub. L. S7-415, 96 Stat. 2073 (42 U.S.C. 2239). Section 50.78 also issued under sec. 122, 68 Stat. 939 (42 U.S.C. 2152). Sections 50.80-50.81 also issued under sec. 184, 68 Stat.
954, as amended (42 U.S.C. 2234). Section 50.103 also under sec. 108, 68 Stat. 939, as amended (42 U.S.C. 2138). Appendix F also issued under sec. 187, 68 Stat. 955 (42 U.S.C. 2237).
For the purposes of sec. 223, 68 Stat. 958, as amended (42 U.S.C.
2273); SS 50.10(a), (b), and (c), 50.44, 50.46, 50.48, 50.54, and 50.80(a) are issued under sec. 161b, 68 Stat. 948, as amended (42 U.S.C. 2201(b));
SS 50.10(b) and (c), and 50.54 are issued under sec. 1611, 68 Stat. 949, as amended (42 U.S.C. 2201(i)); and SS 50.9, 50.55(e), 50.59(b), 50.70, 50.71, 50.72, 50.73, and 50.78 are issued under sec. 161o, 68 Stat. 950, as amended (42 U.S.C. 2201(o)).
- 13. A new definition is added to S 50.2 in appropriate alphabetical order to read as follows:
S 50.2 Definitions.
128 Enclosure A
..' [7590-01]
"Decommission".means to remove (as a facility) safely from service and reduce residual radioactivity to a level that permits release of the property for unrestricted use and termination of license.
- 14. Section 50.33 is amended by republishing the introductory text of paragraph (f), revising paragraphs.(f)(2) and (4), and adding para-graph (k) to read as follows: '
S 50.33 Contents of applications; general information.
Each application shall state:
(f) Except for an electric utility applicant for a license to oper-ate a utilization facility of the type described in S 50.21(b) or S 50.22, information sufficient to demonstrate to the Commission the financial qualification of the applicant to carry out, in accordance with regula-tions in this chapter, the activities for which the permit or license is sought. As applicable, the following should be provided:
(2) If the application is for an operating license, the applicant shall submit information that demonstrates the applicant possesses or has reasonable assurance si obtaining the funds necessary to cover esti-mated operation costs for the period of the license. The applicant shall submit estimates for total annual operating costs for each of the first five years of operation of the facility. The applicant shall also indi-cate the source (s) of funds to cover these costs. An application to renew or extend the term of an operating license must include the same finan-cial information as is required in an application for an initial licente.
129 Enclosure A
[7590-01] -
(4) The Commission may request an established entity or newly-formed entity to submit additional or more detailed information respect-ing its financial arrangements and status of funds if the Commission considers this information appropriate. This may include information regarding a licensee's ability to continue the conduct of the activities authorized by the license and to decommission the facility.
- A A A (k)(1) For an application for an operating license for a produc-tion or utilization facility, information in the form of a report, as described in S 50.75 of this part, indicating how reasonable assurance will be provided that funds will be available to decommission the facility.
(2) On or before , each holder of an operating license for a production or utilization facility in effect on shall submit information in the form of a report as described in S 50.75 of this part, indicating how reasonable assurance will be provided that funds will be available to decommission the facility.
- 15. Section 50.51 is revised to read as follows:
S 50.51 Duration of license, renewal.
Each license will be issued for a fixed period of time to_be speci-fied in the license but in no case to exceed 40 years from the date of issuance. Where the operation of a facility is involved the Commission will issue the license for the term requested by the applicant or for the estimated useful life of the facility if the Commission determines that the estimated useful life is less than the term requested. Where construction of a facility is involved, the Commission may specify in the construction permit the period for which the license will be issued 130 Enclosure A
- c. [7590-01]
- . \
if approved pursuant to S 50.56. Licenses may.be renewed by the Commis-
~
sion upon the expiration of the period. Application for termination of license is to be made pursuant to S 50.82.
- 16. A new S 50.75 is added to read as follows:
6 50.75 Reporting and recordkeeping for decommissioning planning.
(a) This section establishes requirements for indicating to NRC how reasonable assurance will be provided that funds will be available for decommissioning. For electric utilities it consists of a step-wise procedure as provided in paragraphs (b), (c), (e), and (f) of this section. Funding for decommissioning of electric utilities is also subject to the regulation of agencies (e.g., Federal Energy Regulatory Commission (FERC) and State Public Utility Commissions) having jurisdic-tion over rate regulation. The requirements of this section, in parti-cular paragraph (c), are in addition to, and not substitution for, other requirements, and are not intended to be used, by themselves, by other agencies to establish rates.
(b) Each electric utility applicant for or holder of an operating license for a production or utilization facility of the type and power level specified in paragraph (c) of this section shall submit a decom-missioning report, as required by 6 50.33(k) of this part containing a certification that financial assurance for decommissioning will be pro-vided in an amount which may be more but not less than the amount stated in the table in paragraph (c)(1) of this section, adjusted annually using a rate at least equal to that stated in paragraph (c)(2) of this section, by one or more of the methods describec in paragraph (e) of this section as acceptable to the Commission. The amount stated in the applicant's or 131 Enclosure A
[7590-01]
l licensee's certification may be based on a cost estimate for decommission-ing the facility. As part of the certification, a copy of the financial instrument obtained to satisfy the requirements of paragraph (e) of this section is to be submitted to NRC.
(c) Table of minimum amounts (1986 dollars) required to demonstrate reasonable assurance of funds for decommissioning by reactor type and power level, P (in MWt); adjustment factor.1 (1)(i) For a PWR:
greater than or equal $105 Million to 3400 MWt between 12'00 MWt and 3400 MWt $(76 + 0.0088P) Million (For a PWR of less than 1200 MWt, use P=1200 MWt)
(ii) For a BWR:
greater than or equal $135 Million to 3400 MWt between 1200 MWt and 3400 MWt $(104 + 0.009P) Million (For a BWR of less than 1200 MWt, use P=1200 MWt)
(2) An adjustment factor at least equal to 0.65 L + 0.13 E + 0.22 B is to be used where L and E are escalation factors for labor and energy, respectively, and are to be taken from regional data of U.S. Department of Labor Bureau of Labor Statistics and B is an escalation factor for waste burial and is to be taken from NRC report NUREG-1307, "Report on Waste Burial Charges."
1 Amounts are based on activities related to the definition of "Decommis- t sion" in S 50.2 of this part and do not include the cost of removal and disposal of spent fuel or of nonradioactive structures and materials beyond that necessary to terminate the license.
132 Enclosure A 1
l
[7590-01]
(d) Each non-electric utility applicant for or holder of an operat-ing license for a production or utilization facility shall submit a decom-missioning report as required by S 50.33(k) of this part containing a -
cost estimate for decommissioning the facility, an indication of which method or methods described in paragraph (e) of this section as accept-able to the Commission will be used to provide funds for decommission-ing, and a description of the means of adjusting the cost estimate and associated funding level periodically over the life of the facility.
(e)(1) As provided in paragraphs (e)(2) and (3) of this section, financial assurance is to be provided by the following methods:
(i) Prepayment. Prepayment is the deposit prior to the start of l operation into an account segregated from licensee assets and outside !
l the licensee's administrative control of cash or liquid assets such that the amount of funds would be sufficient to pay decommissioning costs.
Prepayment may be in the form of a trust, escrow account, government fund, I
certificate of deposit, or deposit of government securities. I (ii) External sinking fund. An external sinking fund is a fund established and maintained by setting funds aside periodically in an account segregated from licensee assets and outside the licensee's administrative control in which the total amount of funds would be l sufficient to pay decommissioning costs at the time termination of operation is expected. An external sinking fund may be in the form of a trust, escrow account, government fund, certificate of deposit, or deposit of government securities.
(iii) A surety method, insurance, or- other guarantee method. These methods guarantee that decommissioning costs will be paid should the licen-see default. A surety method may be in the form of a surety bond, letter 133 Enclosure A
[7590-01] ,, .
of credit, or line of credit. Any surety method or insurance'used to provide financial insurance for decommissioning must contain the following I
conditions: ,
4 (A) The surety method or insurance must be open-ended or, if written '
for a specified term, such as five years, must be renewed automatically unless 90 days or more prior to the renewal date, the issuer notifies the Commission, the beneficiary, and the licensee of its intention not to renew. The surety or insurance must also provide that the full face amount be paid to the beneficiary automatically prior to the expiration without pruof of forfeiture if the licensee fails to provide a replacement accep-table to the Commission within 30 days after receipt of notification of cancellation.
(B) The surety or insuranco must be payable to a trust established for decommissioning costs. The trustee and trust must be acceptable to the Commission. An acceptable trustee includes an appropriate State or Federal government agency or an entity which has the authority to act as a trustee and whose trust operations are regulated and examined by a Federal or State agency.
(C) The surety method or insurance must remain in effect until the Commission has terminated the license.
(2) For a licensee other than an electric utility, acceptable methods of providing financial assurance for decommissioning are--
(i) Prepayment; (ii) An external sinking fund, in which deposits are made at least annually, coupled with a surety method or insurance, the value of which may decrease by the amount being accumulated in the sinking fend, l
134 Enclosure A 1
.. [7590-01]
(iii) A surety method, insurance, or other guarantee method. A parent
~
company guarantee of funds for decommissioning costs based on a financial test may be used if the guarantee and test are as contained in Appendix A of 10 CFR Part 30. A parent company guarantee may not be used in combina-tion with other financial methods to satisfy the requirements of this section.
(iv) In the case of Federal, State, or local government licensees, a statement of intent containing a cost estimate for decommissioning, and indicating that funds for decommissioning will be obtained when necessary.
(3) For an electric utility, acceptable methods of providing finan-cial assurance for decommissioning are--
(i) Prepayment; (ii) An external sinking fund in which deposits are made at least annually; (iii) A surety method or insurance; and (iv) In the case of Federal government licensees, a statement of intent containing a cost estimate for decommissioning or an amount based on paragraph (c) of this section, and indicating that funds for decom-missioning will be obtained when necessary.
(f) Each licensee shall at or about 5 years prior to the projected end of operation submit a preliminary decommissioning plan containing a i cost estimate for decommissioning and an up-to-date assessment of the major technical factors that could affect planning for decom:nissioning.
Factors to be considered in submitting this information include--
(1) The decommissioning alternative anticipated to be used. The requirements of S 50.82(b)(1) must be considered at this time; 135 Enclosure A
[7590-01) ,,
(2) Major technical actions necessary to carry out decommissioning safely; ~
(3) The current situation with regard to disposal of high-level and low-level radioactive waste; (4) Residual radioactivity criteria; (5) Other site specific factors which could affect decommissioning planning and cost.
If necessary, this submittal shall also include plans for adjusting levels of funds assured for decommissioning to demonstrate that a reasonable level of assurance will be provided that funds will be available when needed to cover the costs of decommissioning.
, (g) Each licensee s.411 keep records of information important to the safe and effective decommissioning of the facility in an identified loca-tion until the license is terminated by the Commission. If records of relevant information are kept for other purposes, reference to these re-cords and their locations may be used. Information the Commission con-siders important to decommissicaing consists of --
(1) Records of spills or other unusual occurrences involving the spread of contamination in and around the facility, equipment, or site.
These records may be limited to instances when significant contamina-tion remains after any cleanup procedures or When there is reasonable likelihood that contaminants may have spread to inaccessible areas as in the case of possible seepage into porous materials such as concrete.
These records must include any known information on identification of involved nuclides, quantities, forms, and concentrations.
(2) As-built drawings and modifications of structures and equipment-in restricted areas where radioactive materials are used and/or stored 136 Enclosure A
" [7590-01]
and of locations of possible inaccessible contamination such as buried pipes which may be subject to contamination. If required drawings are referenced, each relevant document need not be indexed individually. If drawings are not available, the licensee shall substitute appropriate records of available information concerning these areas and locations.
(3) Records of the cost estimate performed for the decommissioning funding plan or of the amount c:ertified for decommissioning, and records of the funding method used for assuring funds if either a funding plan or certification is used.
- 17. Section 50.82 is revised to read as follows:
6 50.82 Application for termination of license.
(a) Any licensee may apply to the Commission for authority to sur-render a license voluntarily and to decommission the facility. For a facility that permanently ceases operation after this application must be made within two years following permanent cessation of operations, and in no case later than one year prior to expiration of the operating license. Each application for termination of license must be accompanied, or preceded, by a proposed decommissioning plan. For a facility which has permanently ceased operation prior to ,
requirements for contents of the decommissioning plan as specified in paragraphs (b) through (d) of this section may be modified with approval of the Commission to reflect the fact that the decommissioning process has been initiated previously. '
(b) The proposed decommissioning plan must include--
(1) The choice of the alternative for decommissioning with a des-cription of activities involved.
137 Enclosure A j 1
[7590-01) .,
l (i) For an electric utility licensee, an alternative is acceptable if it provides for completion of decommissioning within 60 years. Consid-sideration will be given to an alternative which provides for completion of decommissioning beyond 60 years only when necessary to protect the public health and safety. Factors to be considered in evaluating an alternative which provides for completion of decommissioning beyond 60 years are set out in paragraph (b)(1)(iii) of this section.
(ii) For a licensee other than an electric utility, an alternative is acceptable if it provides for completion of decommissioning without significant delay. Consideration will be given to an alternative which provides for delayed completion of decommissioning only when necessary to protect the public health and safety. Factors to be considered in evaluating an alternative which provides for delayed completion of decom-missioning are set out in paragraph (b)(1)(iii) of this section.
(iii) Factors to be considered in making the evaluations required by paragraphs (b)(1)(i) and (b)(1)(ii) of this section include unavail-ability of waste disposal capacity and other site specific factors affecting the licensee's capability to carry out decommissioning safely, including presence of other nuclear facilities at the site.
(2) A description of controls and limits on procedures and equip-ment to protect occupational and public health and safety; (3) A description of the planned final radiation survey; (4) An updated cost estimate for the choseri alternative for decom- !
missioning, comparison of that estimate with p*ttent funds set aside for l l
decommissioning, and plan for assuring the availability of adequate funds for completion of decommissioning.
138 Enclosure A
[7590-01]
(5) A description of technical specifications, quality assurance provisions and physical security plan provisions in place during decom-missioning, (c) Decommissioning plans which propose an alternative that delays completion of decommissioning by including a period of storage or long-term surveillance must provide that- -
(1) Funds needed to complete decommissioning be placed into an account segregated from licensee assets and outside the licensee's admin-istrative control during the storage or surveillance period, or a surety method or fund statement of intent be maintained in accordance with the criteria of S 50.75 (e), and (2) Means be included for adjusting cost estimates and associated funding levels over the storage or surveillance period.
(d) For decommissioning plans in which the major dismantlement activities are delayed by first placing the facility in storage, planning for these delayed activities may be less detailed. Updated detailed plans must be submitted and approved prior to the start of these activities.
(e) If the decommissioning plan demonstrates that the decommission-ing will be performed in accordance with the regulations in this chapter and will not be inimical to the common defense and security or to the health and safety of the public, and after notice to interested persons, the Commission will approve the plan subject to such conditions and limitations as it deems appropriate and necessary and issue an order authorizing the decommissioning.
(f) The Commission will terminate the license if it determines that--
139 Enclosure A a .. . -. - _ . - -
[7590-01]
(1) The decommissioning has been performed in accordance with the approved decommissioning plan and the order authorizing decommissioning; and (2) The terminal radiation survey and associated documentation demonstrates that the facility and site are suitable for release for unrestricted use.
PART 51 - ENVIRONMENTAL PROTECTION REGULATIONS FOR DOMESTIC i
LICENSING AND RELATED REGULATORY FUNCTIONS
- 18. The authority citation for Part 51 continues to read as follows:
AUTHORITY: Sec. 161, 68 Stat. 948, as amended (42 U.S.C. 2201);
secs. 201, as amended, 202, 88 Stat. 1242, as amended, 1244 (42 U.S.C.
5841, 5842).
Subpart A also issued under National Environmental Policy Act of 1969, secs. 102, 104, 105, 83 Stat. 853-854, as amended (42 U.S.C. 4332, 4334, 4335); and Pub. L.95-604, Title II, 92 Stat. 3033-3041. Section 51.22 also issued under sec. 274, 73 Stat. 688, as amended by 92 Stat. 3036-3038 (42 U.S.C. 2021).
S 51.20 [ Amended)
- 19. Section 51.20 is amended by removing and reserving paragraphs (b)(5) and (10).
1 140 Enclosure A
[7590-01)
- 20. In S 51.53, paragraph (b) is revised to read as follows:
S 51.53 Supplement to Environmental Report.
(b) Post operating license stage. Each applicant for a license amendment authorizing the decommissioning of a production or utilization facility covered by S 51.20 and each applicant for a license or license amendment to store spent fuel at a nuclear power reactor after expira-tion of the operating license for the nuclear power reactor shall submit with its application the number of copies, as specified in S 51.55, of a separate document, entitled "Supplement to Applicant's Environmental Report--Post Operating License Stage," which will update "Applicant's Environmental Report--Operating License Stage," as aopropriate, to reflect any new information or significant environmental change associated with the applicant's proposed decommissioning activities or with the appli-cant's proposed activities with respect to the planned storage of spent fuel. Unless otherwise required by the Commission, in accordance with the generic determination in S 51.23(a) and the provisions in S 51.23(b),
the applicant shall only address the environmental impact of spent fuel storage for the term of the license applied for. The "Supplement to Applicant's Environmental Report--Post Operating License Stage" may incorporate by reference any information contained in "Applicant's Environmental Report--Construction Permit Stage," "Supplement to Appli-cant's Environmental Report--Operating License Stage," final environ-mental impact statement, supplement to final environmental impact statement or records of decision previously prepared in connection with the construction permit or operating license.
141 Enclosure A
[7590-01]
l
- 21. In S 51.55, paragraph (a) is revised to read as follows:
$ 51.55 Environmental Report - Number of copies; distribution.
(a) Each applicant for a license to construct and operate a produc-tion or utilization facility covered by paragraphs (b)(1), (b)(2), (b)(3) or (b)(4) of S 51.20 and each applicant for a license amendment authoriz-ing the decommissioning of a production or utilization facility covered by 8 51.20, and each applicant for a license or license amendment to store spent fuel at a nuclear power reactor after expiration of the operating license for the nuclear power reactor shall submit to the Director of Nuclear Reactor Regulation or the Director of Nuclear Material Safety and Safeguards, as appropriate, forty-one (41) copies of an environmental report, or any supplement to an environmental report. The applicant shall retain an additional 109 copies of the environmental report or any supplement to the environmental report for distribution to parties and Boards in the NRC proceeding, Federal, State, and local officials and any affected Indian tribes, in accordance with written instructions issued by the Director of Nuclear Reactor Regulation or the Director of Nuclear Material Safety and Safeguards, as appropriate.
A A A A
- i
- 22. Section 51.60 is amended by revising paragraph (a) to read as follows: 1 S 51.60 Environmental Report - Materials licenses.
(a) Each applicant for a license or other form of permission, or an amendment to or renewal of a license or other form of permission issued pursuant to Parts 30, 32, 33, 34, 35, 39, 40, 61, 70 and/or 72 of this chapter, and covered by paragraphs (b)(1)-(b)(6) of this section, shall i
submit with its application to the Director of Nuclear Material Safety I
142 Enclosure A
[7590-01]
j and Safeguards the number of copies, as specified in S 51.66, of a sepa-rate document, entitled "Applicant's Environmental Report" or "Supplement to Applicant's Environmental Report," as appropriate. The "Applicant's Environmental Report" shall contain the information specified in S 51.45.
If the application is for an amendment to or a renewal of a license or other form of permission for which the applicant has previously submitted an environmental report, the supplement to applicant's environmental report may be limited to incorporating by reference, updating or supple-menting the information previously submitted to reflect any significant environmental change, including any significant environmental change resulting from operational experience or a change in operations or pro-posed decommissioning activities.
- 23. In S 51.95, paragraph (b) is revised to read as follows:
S 51.95 Supplement to final environmental impact statement.
(b) Post operating license stage _._ In connection with the amendment of an operating license to authorize the decommissioning of a production or utilization facility covered by S 51.20 or with the issuance, amend-ment or renewal of a license to store spent fuel at a nuclear power reactor after expiration of the operating license for the nuclear power reactor, the NRC staff will prepare a supplemental environmental impact i
statement for the post operating license stage or an environmental !
assessment, as appropriate, which will update the prior environmental review. The supplement or assessment may incorporate by reference any information contained in the final environmental impact statement, the supplement to the final environmental impact statement - operating 143 Enclosure A
[7590-01]
license stage, or in the records of decision prepared in connection with the construction permit or the operating license for that facility. The supplement will include a request for comments as provided in S 51.73.
Unless otherwise required by the Commission, in accordance with the generic determination in 9 51.23(a) and the provisions of 8 51.23(b), a supplemental environmental impact statement for the post operating license stage or an environmental assessment, as appropriate, will address the environmental impacts of spent fuel storage only for the i
term of the license, license amendment or license renewal applied for.
PART 70 - DOMESTIC LICENSING OF SPECIAL NUCLEAR MATERIAL
- 24. The authority section for Part 70 is revised to read as follows:
AUTHORITY: Secs. 51, 53, 161, 182, 183, 68 Stat. 929, 930, 948, 953, 954, as amended, sec. 234, 83 Stat. 444, as amended (42 U.S.C. 2071, 2073, 2201, 2232, 2233, 2282); secs. 201, as amended, 202, 204, 206, 88 Stat.
1242, as amended, 1244, 1245, 1246 (42. U.S.C. 5841, 5842, 5845, 5846).
Section 70.7 also issued under Pub. L.95-601, sec. 10, 92 Stat.
2951 (42 U.S.C. 5851). Section 70.21(g) also issued under sec. 122, 68 Stat. 939 (42 U.S.C. 2152). Section 70.31 also issued under sec. 57d, Pub. L.93-377, 88 Stat. 475 (42 U.S.C. 2077). Sectior.s 70.36 and 70.44 also issued under sec. 184, 68 Stat. 954, as amended (42 U.S.C. 2234).
Section 70.61 also issued under secs. 186, 187, 68 Stat. 955 (42 U.S.C.
2236, 2237). Section 70.62 also issued under sec. 108, 68 Stat. 939, as amended (42 U.S.C. 2138).
144 Enclosure A i
[7590-01]
1 For the purposes of sec. 223, 68 Stat. 958, as amended (42 U.S.C.
-2273), SS 70.3, 70.19(c), 70.21(c), 70.22(a), (b), (d)-(k), 70.24(a) and (b), 70.32(a)(3), (5), (6), (d), and (i), 70.36, 70.39(b) and (c), 70.41(a),
70.42(a) and (c), 70.56, 70.57(b), (c), and (d), 70.58(a)-(g)(3), and (h)-(j) are issued under sec. 161b, 68 Stat. 948, as amended (42 U.S.C.
2201(b)); $$ 70.7, 70.20a(a) and (d),.70.20b(c) and (e), 70.21(c), 70.24(b),
70.32(a)(6), (c), (d), (e), and (g), 70.36, 70.51(c)-(g), 70.56, 70.57(b) and (0), and 70.58(a)-(g)(3), and (h)-(j) are issued under sec. 1611, 68 Stat. 949, as amended (42 U.S.C. 2201(i)); and $$ 70.5, 70.9, 70.20b(d) and (e}, 70.38, 70.51(b) and (i), 70.52, 70.53, 70.54, 70.55, 70.58(g)(4),
I (k), and (1), 70.59, and 70.60(b) and (c) are issued under sec.1610, 68 ;
Stat. 950, as amended (42 U.S.C. 2201(o)).
- 25. Section 70.4 is amended by adding a new paragraph (bb) to read as follows:
?
S 70.4 Definitions.
(bb) "Decommission" means to remove (as a facility) safely from service and reduce residual radioactivity to a level that permits release of the property for unrestricted use and termination of license.
- 26. Section 70.22 is amended by adding a new paragraph (a)(9) l to read as follows:
S 70.22 Contents of applications. 1 (a) Each application for a license shall contain the following information: l 145 Enclosure A l l
I
[7590-01] '
(9) As provided by S 70.25, certain applications for specific licenses filed under this part must contain a proposed decommissioning funding plan or a certification of financial assurance for decommission-ing. In the case of renewal applications submitted before this submittal may follow the renewal application but must be submitted on or before .
A A A A A
- 27. A new S 70.25 is added to read as follows:
S 70.25 Financial assurance and recordkeeping for decommissioning.
(a) Each applicant for a specific license authorizing the posses-sion and use of unsealed special nuclear material in quantities exceeding 105 times the applicable quantities set forth in Appendix C to 10 CFR Part 20 shall submit a decommissioning funding plan as described in paragraph (e) of this section. A decommissioning funding plan must also be submitted when a combination of isotopes is involved if R divided by 105 is greater than 1 (unity rule), where R is defined here as the sum of the ratios of the quantity of each isotope to the applicable value in Appendix C.
(b) Each applicant for a specific license authorizing possession and use of unsealed special nuclear material in quantities specified in paragraph (d) of this section shall either--
(1) Submit a decommissioning funding plan as described in paragraph (e) of this section; or (2) Submit a certification that financial assurance for decommis-sioning has been provided in the amount prescribed by paragraph (d) of this section using one of the methods described in paragraph (f) of this 146 Enclosure A
[7590-01]
section. For an applicant, this certification may state that the appro-priate assurance will be obtained after the application has been approved and the license issued but prior to the receipt of licensed material.
As part of the certification, a copy of the financial instrument obtained to satisfy the requirements of paragraph (e) of this section is to be
~
submitted to NRC.
(c)(1) Each holder of a specific license issued on or after which is of a type described in paragraph (a) or (b) of this section, shall provide financial assurance for decom-missioning in accordance with the criteria set forth in this section.
(2) Each holder of a specific license issued before and of a type described in paragraph (a) of this section shall submit, on or before , a decommissioning funding plan or certifica-tion of financial assurance for decommissioning in an amount at least equal to $750,000 in accordance with the criteria set forth in this sec-tion. If the licensee submits the certification of financial assurance rather than a decommissioning funding plan at this time, the licensee shall include a decommissioning funding plan in any application for license renewal.
(3) Each holder of a specific license issued before ,
and of a type described in paragraph (b) of this section shall submit, on r
or before , a certification of financial assurance for decommissioning or a decommissioning funding plan in accordance with the criteria set forth in this section.
(d) Table of required amounts of financial assurance for decommis-sioning by quantity of material.
147 Enclosure A
[7590-01]
greater than 104 but less than or equal $750,000 to 105 times the applicable quantities of Appendix C of Part 20. (For a com-bination of isotopes, if R, as defined in S 70.25(a), divided by 104 is greater than 1 but R divided by 105 is less than or equal to 1.)
greater than 103 but less than or equal $150,000 to 104 times the applicable quantities of Appendix C of Part 20. (For a com-I bination of isotopes, if R, as defined in S 70.25(a), divided by 103 is greater f than 1 but R divided by 104 is less than or equal to 1.)
(e) Each decommissioning funding plan must contain a cost estimate i
for decommissioning and a description of the method of assuring funds for decommissioning from paragraph (f) of this section, including means of adjusting cost estimates and associated funding levels periodically over the life of the facility.
l l (f) Financial assurance for decommissioning must be provided by one l
, or more of the following methods:
(1) Prepayment. Prepayment is the deposit prior to the start of operation into an account segregated from licensee assets and outside the the licensee's administrative control of cash or liquid assets such that the amount of funds would be sufficient to pay decommissioning costs.
Prepayment may be in the form of a trust, escrow account, government fund, certificate of deposit, or deposit of government securities.
(2) A surety method, insurance, or other guarantee method. These methods guarantee that decommissioning costs will be paid should the li-censee default. A surety method may be in the form of a surety bond, letter of credit, or line of credit. A parent company guarantee of funds for decommissioning costs based on a financial test may be used if the 148 Enclosure A
[7590-01] !
j
. l
. 1 guarantee and test are as contained in Appendix A of 10 CFR Part 30. A
~
parent company guarantee may not be used in combination with other finan- '
ial methods to satisfy the requirements of this section. Any surety method or insurance used to provide financial assurance for decommissioning must contain the following conditions:
(i) The surety method or insuran,ce must be open-ended or, if written for a specified term, such as five years, must be renewed auto- ,
matically unless 90 days or more prior to the renewal date, the issuer notifies the Commission, the beneficiary, and the licensee of its inten-tion not to renew. The surety method or insurance must also provide that the full face amount be paid to the beneficiary automatically prior to the expiration without proof of forfeiture if the licensee fails to pro-vide a replacement acceptable to the Commission within 30 days after receipt of notification of cancellation.
(ii) The surety method or insurance must be payable to a trust established for decommissioning costs. The trustee and trust must be acceptable to the Commission. An acceptable trustee includes an appro-priate State or Federal government agency or an entity which has the authority to act as a trustee and whose trust operations are regulated and examined by a Federal or State agency. ;
(iii) The surety method or insurance must remain in effect until the .
Comission has terminated the license.
(3) An external sinking fund in which deposits are made at least i
annually, coupled with a surety method or insurance, the value of which '
may decrease by the amount being accumulated in the sinking fund. An external sinking fund is a fund established and maintained by setting aside funds periodically in an account segregated from licensee assets
- 149 Enclosure A
and outside the licensee's administrative control in which the total amount of funds would be sufficient to pay decommissioning costs at the time termination of operation is expected. An external sinking fund may be in the form of a trust, escrow account, government fund, certificate of deposit, or deposit of government securities. The surety oi insurance provisions must be as stated in paragraph (f)(2) of this section.
(4) In the case of Federal, State, or local government licensees, a statement of intent containing a cost estimate for decommissioning or an amount based on the Table in paragraph (d) of this ection, and indi-cating that funds for decommissioning will be obtained when necessary.
(g) Each person licensed under this part shall keep records of information important to the safe and effective decommissioning of the facility in an identified location until the license is terminated by the Commission. If records of relevant information are kept for other pur-poses, reference to these records and their locations may be used. Infor-mation the Commission considers important to decommissioning consists of--
(1) Records of spills or other unusual occurrences involving the spread of contamination in and around the facility, equipment, or site.
These records may be limited to instances when contamination remains af ter any cleanup procedures or when there is reasonable likelihood that conta-minants may have spread to inaccessible areas as in the case of possible seepage into porous materials such as concrete. These records must include any known information on identification of involved nuclides, quantities, forms, and concentrations.
(2) As-built drawings and modifications of structures and equipment in restricted areas wh9re radioactive materials are used and/or, stored 150 Enclosure A
[7590-01) and of locations of possible inaccessible contamination such as buried pipes which may be subject to contamination. If required drawings are referenced, each relevant document need not be indexed individually. If drawings are not availablo, the licensee shall substitute appropriate records of available information concerning these areas and locations.
(3) Records of the cost estimate, performed for the decommissioning funding plan or of the amount certified for decommissioning, and records of the funding method used for assuring funds if either a funding plan or certification ir used.
- 28. Section 70.48 is revised to read as follows:
S 70.38 Expiration and termination of licenses.
(a) Except as provided in S 70.33(b) and paragraph (e) of this sec-tion, each specific license expires at the end of the day, in the month and year stated in the license.
(b) Each licensee shall notify the Commission promptly, in writing under S 70.5, and request termination of the license when the licensee decides to terminate all activities involving materials authorized under the license. This notification and request for termination of the license must include the reports and information specified in paragraphs (c)(1)(iv) and (v) of this section and a plan for completion of decommissioning if required by paragraph (c)(2) of this section or by license condition.
(c)(1) If a licensee does not submit an application for license renewal under S 70.33, the licensee shall an or before the expiration date specified in the license--
l 151 Enclosure A
_ . . _ . _ _,_ ~ __ _ . _ . - _ -
[7590-01) . l (1) Terminate use of special nuclear material; i
(ii) Remove radioactive contamination to the extent practicable except for those procedures covered by paragraph (c)(2)(i) of this section; (iii) Properly dispose of special nuclear material; (iv) Submit a completed form NRC-314, which certifies information concerning the disposition of materials; and (v) Conduct a radiation survey of the premises where the licensed activities were carried out and submit a report of the results of this survey, unless the licensee demonstrates that the premises are suitable for release for unrestricted use in some other manner. The licensee 1
shall, as appropriate-- l (A) Report levels of radiation in units of microrads per hour of beta and gamma radiation at one centimeter and gamma radiation at one meter from surfaces, and report levels of radioactivity, including alpha, <
in units of disintegrations per minute (or microcuries) per 100 square centimeters removable and fixed for surfaces, microcuries per milliliter for water, and picocuries per gram for solids such as soils or concrete;
! and (B) Specify the survey instrument (s) used and certify that each instrument is properly calibrated and testui.
l (2)(i) In addition to the information required under para-i graphs (c)(1)(iv) a.d (v) of this section, the licensee shall submit I a plan for completion of decommissioning if the procedures necessary to carry out decommissioning have not been previously approved by the ;
NRC and could increase potential health and safety impacts to workers or to the public such as in any of the following cases:
l 152 Enclosure A
e
[7590-01] l O
i 1
(A) Procedures would involve techniques not applied routinely
~
during cleanup or maintena'nce operawions; or (B) Workers would be entering areas not normally occupied where surface contamination and radiation levels are significantly higher than routinely encountered during operation; or (C) Procedures could result in s.ignificantly greater airborne con-centrations of radioactive materials than are present during operation; or (D) Procedures could result in significantly greater releases of radioactive material to the environment than those associated with operation.
(ii) Procedures with potential health and safety impacts may not be carried out prior to approval of the decommissioning plan.
(iii) The proposed decommissioning plan, if required by paragraph (c)
(2)(i) of this section or by license condition, must include--
(A) Description of planned decommissioning activities; (B) Description of methods used to assure protection of workers and the environment against radiation hazards during decommissioning; (C) A description of the planned final radiction survey; and (D) An updated detailed cost estimate for decommissioning, compari-son of that estimate with present funds set aside for decommissioning, and plan for assuring the availability of adequate funds for completion of decommissioning.
(E) A description of the physical security plan and material control and accounting plan provisions in place during decommissioning.
153 Enclosure A
[7590-01] -
e (iv) The proposed decommissioning plan will be approved by the Commission if the information therein demonstrates that the decommission-ing will be completed as soon as is reasonable and that the health and safety of workers and the public will b'e adequately protected.
(3) Upon approval of the decommissioning plan by the Commission, the licensee shall complete decommissioning in-accordance with the approved plan. As a final step in decommissioning, the licensee shall again submit the information required in paragraph (c)(1)(v) of this section and shall i
certify the disposition of accumulated wastes from decommissioning.
(d) If the information submitted under paragraphs (c)(1)(v) or (c)(3) of this section does not adeouately demonstrate that the premises are suitable for release for unrestricted use, the Commission will inform the licensee of the appropriate further actions required for termination of license.
(e) Each specific license continues in effect, beyond the expira-tion date if necessary, with respect to possession of residual special nuclear material present as contamination until the Commission notifies the licensee in writing that the license is terminated. During this time, the licensee shall--
(1) Limit actions involving special nuclear material to those related to decommissioning; and (2) Continue to control entry to restricted areas until they are suitable for release for unrestricted use and the Commission notifies the licensee in writing that the license is terminated.
(f) Specific licenses will be terminated by written notice to the licensee when the Commission determines that--
154 Enclosure A
~
. [7590-01]
(1) Special nuclear material has been properly disposed; (2) Reasonable effort has been made to eliminate residual radioac-tive contaminat, ion, if present, and (3)(i) A radiation survey has been performed which demonstrates that the premises are suitable for release for unrestricted use; or (ii) Other information submitted by the licensee is sufficient to demonstrate that the premises are suitable for release for unrestricted use.
PART 72 - LICENSING REQUIREMENTS FOR THE STORAGE OF SPENT FUEL IN AN INDEPENDENT SPENT FUEL STORAGE INSTALLATION
- 29. The authority citation for Part 72 is revised to read as follows:
AUTHORITY: Sees. 51, 53, 57, 62, 63, 65, 69, 81, 161, 182, 183, 184, 186, 187, 189, 68 Stat. 929, 930, 932, 933, 934, 935, 948, 953, 954, 955, as amended, sec. 234, 83 Stat. 444, as amended (42 U.S.C. 2071, 2073, 2077, 2092, 2093, 2095, 2099, 2111, 2201, 2232, 2233, 2234, 2236, 2237, 2230, 2282); sec. 274, Pub. L.86-373, 73 Stat. 688, as amended (42 U.S.C. 2021); sec. 201, as amended, 202, 206, 88 Stat. 1242, as amended, 1244, 1246 (42 U.S.C. 5841, 5842, 5846); Pub. L.95-601, sec. 10, 92 Stat. 2951 (42 U.S.C. 5851); sec. 102, Pub. L.91-190, 83 Stat. 853 j (42 U.S.C. 4332).
Section 72.34 also issued under sec. 189, 68 Stat. 955 (42 U.S.C.
2239); sec. 134, Pub. L.97-425, 96 Stat. 2230 (42 U.S.C. 10154).
For the purposes of sec. 223, 68 Stat. 958, as amended (42 U.S.C.
2273); SS 72.6, 72.14, 72.15, 72.17(d), 72,19, 72.33(b)(1), (4), (5), (e),
155 Enclosure A
[7590-01]
l (f), and 72.36(a) are i? sued under sec. 161b, 68 Stat. 948, as amended (42 U.S.C. 2201(b)); SS 72.10, 72.15, 72.17(d), 72.33(c), (d)(1), (2), (e),
72.81, 72.83, 72.84(a), and 72.91 are issued under sec. 1611, 68 Stat. l 949, as amended (42 U.S.C. 2201(i)); and SS 72.9, 72.33(b)(3). (d)(3), (f), !
72.35(b), 72.50-72.52, 72.53(a), 72.54(a), 72.55, 72.56, 72.80(c), and ,
l 72.84(b) are issued under sec. 161o, 68 Stat. 950, as amended (42 U.S.C. '
2201(o)).
l l
- 30. Section 72.3 is amended by adding a new paragraph (y) to read as follows:
S 72.3 Definitions.
(y) "Decommission" means to remove (as a facility) safely from service and reduce residual radioactivity to a level that permits rel ase l of the property for unrestricted use and termination of license.
- 31. Section 72.14 is amended by revising paragraph (e)(3) to read as follows:
S 72.14 Contents of application: General and financial information.
(e) *** l l
l (3) Estimated decommissioning costs, and the necessary financial arrangements to provide reasonable assur.snce prior to licensing that decommissioning will be carried out after the removal of spent fuel from l storage.
l l
l l ,
156 Enclosure A 1
, [7590-01) l
- 32. Section 72.18 is revised by revising the section heading and paragraph (b) and by adding new paragraphs (c) and (d) to read as follows:
$ 72.18 Decommissioning planning, including financing and recordkeeping.
(b) The decommissioning funding plan must contain information on how reasonable ~ assurance will be provi.ded that funds will be available 1
to decommission the ISFSI. This information must include a cost estimate for decommissioning and a description of the method of assuring funds for i
decommissioning from paragraph (c) of this section, including means of adjusting cost estimates and associated funding levels periodically over 1
the life of the ISFSI.
l (c) Financial assurance for decommissioning must be provided by one or more of the following methods:
(1) Prepayment. Prepayment is the deposit prior to the start of operation into an account segregated from licensee assets ar.d outside the licensee's administrative control of cash or liquid assets such that the amount of funds would be sufficient to pay decommissioning costs.
Prepayment may be in the form of a trust, escrow account, government fund, certificate of deposit, or deposit of government securities.
i (2) A surety method, insurance, or other guarantee method. These methods guarantee that decommissioning costs will be paid should the licensee dafault. A surety method may be in the form of a surety bond, letter of credit, or line of credit. A parent company guarantee of funds for decommissioning costs based on a financial test may be used if the guarantee and test are as contained in Appendix A of 10 CFR Part 30. A parent company guarantee may not be used in combination with other financial methods to satisfy the requirements of this section. Any surety method 1
157 Enclosure A
?.. w,
[7590-01]
or insurance used to provide financial assurance for decommissioning must contain the following conditions:
(i) The surety method or insurance must be open-ended or, if written for a specified term, such as five years, must be renewed auto-matica11y unless 90 days or more prior to the renewal date, the issuer notifies the Commission, the beneficiary, and the licensee of its intention not to renew. The surety method or insurance cust also provide that the full face amount be paid to the beneficiary automatically prior to the expiration without proof of forfeiture if the licensee fails to provide a replacement acceptable to the Commission within 30 days after receipt of notification of cancellation.
(ii) The surety method or insurance must be payable to a trust established for decommissioning costs. The trustee and trust must be acceptable to the Commission. An acceptable trustee includes an appro-priate State or Federal government agency or an entity which has the authority to act as a trustee and whose trust operations are regulated and examined by a Federal or State agency.
(iii) The surety or insurance must remain in effect until the Commis-sion has terminated the license.
(3) An external sinking fund in which deposits are made at least annually, coupled with a surety method or insurance, the value of which may decreasa by the amount being accumulated in the sinking fund. An external sinking fund is a fund established and maintained by setting aside funds periodically in an account segregated from licensee assets and outside the licensee's administrative control in which the total amount of funds would be sufficient to pay decommissioning costs at the l
time termination of operation is expected. An external sinking fund may 1
158 Enclosure A I
)
~
[7590-01]
be in the form of a trust, escrow account, government fund, certificate of deposit, or deposit of government securities. The surety or insurance provision must be as stated in paragraph (c)(2) of this section.
(4) In the case of Federal, State, or local government licensees, a statement of intent containing a cost estimate for decommissioning, and indicating that funds for decommission.ing will be obtained when necessary.
(5) In the case of electric utility licensees, the methods of S 50.74(e)(1) and (3) of this chapter.
(d) Each licensee shall keep records of information important to the safe and effective decommissioning of the facility in an identified location until the license is terminated by the Commission. If records of relevant information are kept for other purposes, reference to these records and their locations may be used. Information the Commission con-siders important to decommissioning consists of--
(i) Records of spills or other unusual occurrences involving the l
spread of contamination in and around the facility, equipment, or 5,ite. i These records may be limited to instances when contamination remains after any cleanup procedures or when there is reasonable likelihood that conta-minants may have spread to inaccessible areas as in the case of possible seepage into porous materials such as concrete. These records must include any known information on identification of involved nuclides, quantities, forms, and concentrations.
(ii) As-built drawings and modifications of structures and equip-ment in restricted areas where radioactive materials are used and/or '
stored, and of locations of possible inaccessible contamination such as buried pipes which may be subject to contamination. If required drawings s
159 Enclosure A
[7590-01] .
are referenced, each relevant document need not be indexed individually.
If drawings are not available, the licensee shall substitute appropriate records of available information concerning these areas and locations.
(iii) Records of the cost estimate performed for the decommission-ing funding plan or of the amount certified for decommissioning, and 4
records of the funding method used for. assuring funds if either a fund-ing plan or certification is used.
- 33. Section 72.38 is revised to read as follows:
S 72.38 Application for termination of license.
(a) Any licensee may apply to the Commission for authority to sur-render a license voluntarily and to decommission the ISFSI. This appli-cation must be made within two years following permanent cessation of operations, and in no case later than one year prior to expiration of the license. Each application for termination of license must be accompanied, or preceded, by a proposed final decommissioning plan.
(b) The proposed final decommissioning plan must include--
(1) The ct'oice of the alternative for decommissioning with a description of activities involved. An alternative is acceptable if it provides for completion of decommissioning without significar,t delay.
Consideration will be given to an alternative which prov; des for delayed completion of decommissioning only when necessary to protect the public health and safety. Factors to be considered in evaluating an alternative which provides for delayed completion of decommissioning include unavail-ability of waste disposal capacity and other site specific factors af fect-ing the licensee's capability to carry out decommissioning safely, includ- l ing presence of other nuclear facilities at the site.
l l
160 Enclosure A
4
[7590-01]
(2) A description of controls and limits on procedures and equip-ment to protect occupational and public health and safety; (3) A description of the planned final radiation survey; and l (4) An updated detailed cost estimate for the chosen alternative for decommissioning, comparison of that estimate with present funds set aside for decommissioning, and plan for_. assuring the availability of adequate funds for completion of decommissioning including means for adjusting cost estimates and associated funding levels over any storage or surveillance period.
(5) A description of technical specifications and quality assurance provisions in place during decommissioning, (c) For final decommissioning plans in which the major dismantlement activities are delayed by first placing the ISFSI in storage, planning for these delayed activities may be less detailed. Updated detailed plans L must;be submitted and approved prior to the start of such activities.
(d) If the final decommissioning plan demonstrates that the decom-missioning will be performed in accordance with the regulations in this chapter end will not be inimical to the common defense and security or to the health and safety of the public, and after notice to interested per-sons, the Commission will approve the plan subject to such conditions and limitations as it deems appropriate and necessary and issue an order 4
authorizing the decommissioning.
(e) The Commission will terminate the license if it determines ,
that--
1 l
(1) The decommissioning has been performed in accordance with the ;
approved final decommissioning plan and the order authorizing decommis- !
sioning; and 161 Enclosure A
.-. ~ . -- . _
[7590-01] ,
(2) The terminal radiation survey and associated documentation demonstrates that the ISFSI.and site are suitable for release for unrestricted use.
Dated at Washington, DC, this day of 1988.
For.the Nuclear Regulatory Commission.
i Samuel J. Chilk, Secretary of the Commission.
I t
6
(
l 162 Enclosure A
4 4
4 9
9 ENCLOSURE B e
o
Regulatory Analysis Amendments to 10 CFR Parts 30, 40, 50, 51, 70, and 72 Specifying Licensee Responsibility and Procedures for Decommissioning a Nuclear Facility
- 1. Statement of Problem ,
The nuclear industry is maturing, in that nuclear facilities have been operating for a number of years, and the number of facilities that will require decommissioning is expected to increase in the near future. There are many
, aspects of facility activities that require consideration now with respect to decommissioning. These aspects are assurance of funding, facilitation con-siderations, recordkeeping, planning, and procedures for license termination.
Inadequate or untimely consideration of these decommissioning elements could l
result in significant adverse health, safety, and environmental impacts. These
- impacts could lead to larger occupational and public doses, larger amounts of' radioactive waste to be disposed of, proliferation of contaminated sites, and i economic and sociopolitical problems for the states and Federal Government.
Current regulations as specified under 10 CFR Parts 30, 40, 50, 51, 70, and 72 cover decommissioning in a limited or vague manner and are not fully adequate in dealing with licensee decommissioning requirements. Many licensing activi-ties concerning decommissioning have been made on a case-by-case basis in l direct response to licensee's requests to decommission and in current licensing i hearing cases. This procedure results ~in a lack of uniformity of application, inefficiency on the part of the licensee and NRC in implementation, and finally a lack of timeliness and comprehensiveness that affects proper application of the ALARA principle in carrying out NRC licensing responsibilities. In the case of a few material licensees, both a lack of available funds to carry out l
) decommissioning and improper termination procedures have occurred.
l The staff has considered the current decommissioning needs of the nuclear indus-try, the lack of sufficiently explicit regulatory guidance and the nonuniform, inefficient and noncomprehensive approach that case-by-case considerations can i 1 Enclosure B J
es result in, the staff recommends that more explicit rules be published that would provide guidance to the licensee on careful, timely and comprehensive l planning and implementation of facility decommissioning. The rules would deal with requirements on financial assurance, planning, recordkeeping, and license termination. Their implementation through the NRC licensing process would I assure that decommissioning would be handled by the licensee in a way that would result in minimal impact on health, safety and the environment.
"Decommissioning" as defined in the final rule means to remove safely from service and reduce residual radioactivity to a level that permits release of the property for unrestricted use and termination of license by the NRC. At the end of the useful life of a facility, decommissioning activities should be performed which will ultimately result in termination of the NRC license. It is the responsibility of the NRC to ensure that these activities are performed by the licensee with minimal adverse impact on the health and safety of workers and the public, and on the environment.
As discussed in Section 4.1.1.4, a power reactor has potential for substantial health, safety, and environmental impact if decommissioning is improperly per-formed. This requires major regulatory consideration because of the large number of reactors (approximately 100 operating and 20 under construction), the quantity and radiation level of radioactive materials, size and complexity of the structure, and the proximity to populated areas. Most fuel cycle facili-ties contain low intensity radioactive materials. Most non-fuel-cycle facili-ties usually contain small amounts of very short-lived radioactive materials; a few contain large amounts of very low intensity materials. There are approxi-mately 20,000 non-fuel-cycle licensees (including Agreement State licensees) of which several hundred are decommissioned annually.
l Planning for decommissioning and its proper implementation by the licensee at the earliest practical stage of facility licensing can avoid many potential j problems during decommissioning. In this regard concerns are that (1) funds will be available for decommissioning at the end of useful facility life ;
j because a lack of funds can affect a licensee's ability to select and complete !
an appropriate decommissioning alternative; (2) facilitation, while not a pro-l posed rule requirement, is considered because this can lead to reduction of
)
l I
2 Enclosure B j
i _ _ .
l
- e occupational and public dose, and reduction of waste volumes through such activ-ities at the various stages of design, construction, operation, and actual decommissioning; (3) records are maintained during operation containing infor-mation important to performance of eventual decommissioning; (4) planning is performed with details commensurate with complexity of the facility, which could include choice of decommissioning alternative, procedures, schedules, work plans, and off-site radioactive waste accommodations and; (5) termination procedures are prescribed which besides administrative reporting aspects and approvals -include termination survey plans, their reliability and validation.
It has already been noted that the present rules do not adequately address all the required elements that a licensee must consider in dealing witn decommis-sioning. Lack of specific decommissioning criterion results in inefficient use of staff and non-uniform treatment of licensees. The staff believes that amended rules backed up by regulatory guides will provide proper guidance to the licensees, Federal government, state and local agencies, and information for the general public. Moreover, the staff has assessed the impacts from decommissioning through a comprehensive information base on the technology, safety and costs of decommissioning nuclear facilities, numerous interactions with the states, industry, federal agencies, the general public, and develop-ment of a draft GEIS. Based on these efforts, the staff reached the conclusion that if guidance through rules is provided in essential areas relevant to decom-missioning, then decommissioning can be accomplished with very small impact on the public and environment and in a cost effective way.
- The final rule, when implemented, would allow for reduction of 10 CFR Part 51 j NEPA requirements through elimination of the mandatory requirement for an '
environmental impact statement at the time of decommissioning for 10 CFR -
Part 50 and 72 licenses.
i Finally, it should be noted that residual radioactivity limits for unrestricted use are being addressed in separate rulemaking considerations.
l i l i
1 3 Enclosure B
l
. 1
- 2. Objectives The staff focused on the following objectives in developing these proposed rule amendments:
2.1 Selection of the appropriate regulatory method for implementing
~
decommissioning requirements.
2.1.1 no change -
2.1.2 amendment of licenses 2.1.3 provide additional guidance through regulatory guides 2.1.4 amendments of regulations in 10 CFR Parts 30, 40, 50, 51, 70, and 72 for' clarification and specifications of require-ments for licensees on:
2.1.4.1 assurance of funds for decommissioning 2.1.4.2 facilitation of decommissioning 2.1.4.3 decommissioning plans 2.1.4.4 ' termination of license L 2.2 Reduction of 10 CFR Part 51 NEPA requirements regarding decommissioning.
- 2. 3 Consideration of the economic impact on licensees, especially small licensees.
2.4 Promulgation of regulatory requirements commensurtte with the i Commission's responsibility for public health and safety.
P
- 3. Alternatives
, 3.1 The alternatives considered in determining the need for regulation with respect to decommissioning are as follows:
- 1. No action
- 2. Amendment of licenses
- 3. Use of only regulatory guides
- 4. Amendment of regulations and preparation of regulatory guides 4 Enclosure B
3.1.1 No change in regulations It has already been noted that decommissioning guidance is needed in the areas of financial assurance, facilitation, planning, recordkeeping, and termination procedures. Current requirements are brief, non-specific or limited such as those in: (1) requirements in 10 CFR Part 50.82, Application for Termination of License and in 10 CFR Part 72, Section 72.76, Criteria for Decommissioning, and (2) recent amendments to 10 CFR Parts 30, 40, and 70 specifying licensee responsibility for nuclear materials and procedures for termination of speci-fied licenses. This situation requires the licensee and the Commission staff to work on a case-by-case basis in the development of information needed by the Commission for terminating a license. Thus, a timely, orderly, and comprehen-sive management of licensee decommissioning action may not be possible because of a lack of guidance on decommissioning e.lements needing consideration. The lack of specific decommissioning criteria can result in inefficient and non-uniform actions by the licensee, the NRC and others such as state, federal or public involved parties, leading to greater dose, waste volume and more diffi-cult to predict decommissioning costs. Finally, it should be noted that the Commission in promulgating 10 CFR 50.54(w), which requires that the licensee have onsite property damage insurance to cover the cost of radioactive con-tamination clean up following an accident (47 FR 13750), indicated in the Supplementary Information that decommissioning financial requirements were not dealt with and new commission rulemaking in that area would include this consideration.
3.1.2 Amendment of licenses Amendment of licenses is an alternative available to cover decommissioning requirements of licenses. This alternative is already being used and requires specific actions for each licensee. This can result in repetitive effort and inefficient use of Commission and licensee staff time and could result in an inconsistent application of policy.
l l
5 Enclosure B i
3.1.3 Provide additional guidance through regulatory guides Some of the specific elements af the proposed rule could reasonably be in the form of guidance. However, the NRC position that the licensee provide decom-missioning funding assurance could not be effectively accomplished in this way.
Even for those provisions which could conceivably be in the form of guidance, codification would provide a legal basis and assure more consistent applica-tion. Regulatory guides are planned to supp. ort this rule which would provide guidance to licensees and licens.ing staff on how these requirements can be implemented.
3.1.4 Amendment of regulations This is the recommended alternative. Amendment of regulations and preparation of supporting regulatory guides presents a regulatory method for clearly delin-eating explicit regulatory requirements in a way that is comprehensive, uniform and efficient in dealing with the decommissioning of all nuclear facilities which are licensed or use licensed materials. Requirements are needed for all types of nuclear facilities except waste disposal facilities for which require-ments are already in place. These requirements could be as amendments to 10 CFR Parts 30, 40, 50, 70, and 72 involving clarification and addition to the existing rules as follows:
3.1.4.1 Assurance of funds for decommissioning Licensees should provide reasonable assurance at all times during facility life, including decommissioning, that adequate funds are available to ensure that decommissioning can be accomplished in a safe and timely manner. Lack of funds can cause delay and may result in potential health, safety, environmental, and socio-political problems. The licensee should arrange to assure that funds are '
available through one or more of the following methods:
(1) Prepayment. Prepayment is the deposit prior to the start of opera-tion into an account segregated from licensee assets and outside the licensee's control of cash or liquid assets that will retain their value over the projected operating life of the facility and that are in amount such that the principal 6 Enclosure B
plus accumulated earnings would be sufficient to pay decommissioning costs, r Prepayment may be in the form of a trust, escrow account, government fund, '
certificate of deposit, or deposit of government securities. '
l (2) External sinking fund. An external sinking fund is a fund estab- I lished and maintained by setting funds aside in a periodic manner in an account segregated from licensee assets and outside the licensee's control in which the total amount of funds would be sufficient to pay decommissioning costs at the '
time termination of operation is expected. An external sinking fund may be in the form of a' trust, escrow account, government fund, certificate of deposit, or deposit of government securities.
(3) Surety method, insurance or other guarantee methods. A surety method or insurance is a guarantee that decommissioning costs will be paid should the ,
licensee default. A surety method may be in the form of a surety bond, letter of credit, line of credit or secured interest. A parent company guarantee of funds for decommissioning costs based on a financial test may be used if the guarantee and test are as contained in 10 CFR Part 30, Appendix A of the final rule.
The amount and degree of assurance should be commensurate with potential adverse impact that could occur if the licensee were unable to decommission because of <
a lack of decommissioning funds as well as other financial resources available
, to the licensee. For example, for a utility, which is regulcted by the State Public Utility Commission and collects at established rates and is protected by postaccident decontamination insurance reautred by 10 CFR 50.54(w) an external reserve would constitute reasonable financial assurance; accident cleanup insurance for material facility licensees is under consideration in a separate ;
action and an advanced notice of proposed rulemaking has been issued. For most
) non-fuel-cycle facilities, insurance or bonding would be a reasonable form of j funding assurance. It is recommended that the rule specify acceptable methods
) for different categories of licensees (i.e., utilities vs. non-utilities). Use i of a financial test can also be feasible for some material licensees. 1 i
i 1
l 7 Enclosure B
In developing a rule that would assure that all facilities will be decommis-sioned in a safe and timely way, it is necessary to determine which licensees need to submit information on financial assurance. Various options determining which licensees must provide financial assurance have been considered, ranging from only those likely to have very large decommissioning costs, such as those licensees presently required to submit radiological contingency plans, to all licensees. To require all licensees to submit financial assurance information would not be cost-effective; the health and safety of the public can be ade-quately pro.tected by limiting the requirements to those licensees likely to have substantial decommissioning costs. Therefore, a tiered approach, based on material possession limits, has been used to establish funding requirements for material licenses.
The rule allows the licensee flexibility in choosing a financial assurance mechanism and a data base has been developed by the NRC for decommissioning cost estimates. Such an approach by the NRC should help the licensee to mitigate impacts which may result from the rule imposed financial assurance requirements. For power reactor applicants and licensees, because of the generic nature of decommissioning activities, the rule requires initially a report which indicates that financial assurance is provided in an amount at least equal to that prescribed in the rule as well as method of funding; for the non-reactor licensees the rule would also allow a certification of pres-cribed amounts of available funding for many of the affected licensees based on the radioactive material possession limits allowed by their license. Thus these licensees can be generically treated and would not be required to submit a decommissioning funding estimate. However, all these licensees (except for power reactors) would have the option of submitting a funding estimate for approval, if a lower amount than is prescribed is anticipated. All other affected applicants and licensees such as non power-reactor licensees (Part 50) and independent spent fuel storage facility licensees (Part 72) as well as mate-rial licensees with potential for relatively high decommissioning costs would be required to submit a decomtaissioning fanding plan consisting of a cost esti-mate and method of providing assurance. All material licensees required to sub-mit a funding plan would initially, prior to lirinse renewal, submit a certifi-cation of a prescribed amount, l
8 Enclosure B 4
4 s l l
3.1.4.2 Facilitation of decommissioning j It is recognized that planning for decommissioning at an early stage of facility l construction and operation is desirable. This is especially true of facilita- '
tion aspects (in particular, features that could reduce radiation doses and waste volumes resulting from decommissioning). Features that are reasonable in cost and effective in implementation can be more easily incorporated at early
! stages. However, at any stage of facility 1,ife, consideration of facilitation
- by the licensee is important, particularly if by its implementation, operational and decommissioning cost savings can be obtained. Inflementation of facilita-tion considerations can result in lower radiation doses as well as reduction of l radioactive waste volumes during the actual decommissioning process. No addi-tional rule amendments on facilitation are being proposed except certain recordkeeping requirements; all licensees should, however, consider other ways
] of facilitating decommissioning in the design and operations of the facility.
- This is in keeping with the "as low as is reasonably achievable" (ALARA) 1 concept when implementing protection of health and safety.
Keeping records of information which may be important at the time of decommis- [
sioning should be required because it allows for more efficient and comprehen- I sive decommissioning planning and can therefore result in a reduction of impacts I i to health, safety, and economics during decommissioning. In complying with !
this requirement, the licensee would keep records of information in an identified j location (which could be a relatively simple reference file) containing material important to safe and effective decommissioning such as unusual occurrences [
- involving the spread of contamination in and around the facility, as-built drawings and updates of any changes, etc. Other aspects of facilitation may be
]'
more affected by facility-specific considerations, thus, no other specific
- procedures should be required for all licensees.
! 3.1.4.3 Decommissioning plans 4
Planning for decommissioning is necessary to ensure that all decommissioning i j activities are accomplished in a safe, timely, and efficient manner. As men-l tioned above, financial, facilitation, and recordkeeping considerations need l
J j 9 Enclosure B l i r
to be addressed at licensing or as soon as possible for existing licensees.
Licensees that require a decommissioning plan are required to take into account financial and technical situation at the time of actual decommissioning.
The plans need to address:
Discussion of planned decomissioning activities.
Quality assurance provisions as appropriate
- Safeguards as appropriate Description of methods used to assure protection of workers and the environment against radiation hazards during decomissioning.
A description of the planned final radiation survey.
An updated detailed cost estimate for decommissioning, comparison of that estimate with present funds set aside for decommissioning, and plan for assuring the availability of adequate funds for completion of decommissioning.
It is expected, however, that operators of a large number of some facilities would be able to accomplish all or much of their decommissioning using techniques the same as during routine operation and would not need a decommissioning plan.
3.1.4.4 Termination of Licenses Explicit procedures and requirements for a licensee to terminate a license must be clearly delineated. These include the licensee request to terminate a license and submittal and approval of plans including a termination survey plan.
Surveys submitted for termination must be c'esigned to demonstrate with a high degree of confidence that the property is suitable for release for unrestricted use. The plan including termination survey details should be commensurate with the type of facility and its potential for adverse effects. For many non-fuel-cycle facilities, decommissioning could involve little more than notification that the licensee wishes to terminate the license.
10 Enclosure B
- 3. 2 Reduction of 10 CFR Part 51 NEPA Requirements t
If proper consideration and implementation is given to decommissioning elements (as specified in Section 2.1.3 of this document), the environmental impacts from decommissioning are expected to be small and elimination from 10 CFR Part 51 of the mandatory requirement for an environmental impact statement (EIS) at the time of decommissioning for Part 50 and 72 licenses is warranted. Environmental
- 4. Consequences j 4.1 Benefits and Costs 4.1.1 Benefits 4.1.1.1 NRC 4
The amendments to 10 CFR Parts 30, 40. 50, 51, 70, and 72 will clarify and specify l
NRC requirements and licensee responsibilities for decommissioning nuclear facilities. The rule amendments set forth requirements and procedures the ,
licensee must follow at all licensing stages relating to decommissioning. This l
will reduce uncertainties in the licensing process, reduce the need for the Commission to request additional information from licensees, provide for j uniform, comprehensive and efficient licensing implementation, and ensure that the application of the as low as reasonably achievable principle is effectively considered in areas of health, safety, and the environment. Finally, these
- amendments will allow for termination of licenses in as prompt a manner as possible.
4 a
4.1.1.2 Other Government and State Agencies I
The rule will affect other Federal and State agencies if they are NRC lic .--
sees. For agencies licensed by the NRC the benefits are siinilar to those for
, Industry.
4 11 Enclosure B 1 I
k The clarification of existing licensee responsibility, particularly in the areas of funding assurance and environmental impacts will benefit especially the Federal Energy Regulatory Commission, which regulates rates on interstate a power, and the EPA, which regulates environmental factors affecting the public sector and sets radiation standards. Other agencies such as DOE and 000 will also benefit by having examples of decommissioning requirements to follow in the areas of planning and facilitation.
The rule will affect state agencies in providing for explicit licensee require-ments, particularly in the area of funding assurance. This requirement will ,
benefit the states in allowing for uniform applicability and adequate planning in rate collection requirements (especially for Public Utility Commission rate regulated reactors). Moreover, planning and requirenents for the termination of license will ensure that decommissionings will be performed as promptly as possible with minimal adverse impact on the state and ensure that the health and safety of the public and the environment are adequately protected. In par-J ticular, in the past, state agencies have had to become involved with licensees
! who had insufficient funds to decommission and whose facilities thus posed a threat to public health and safety.
4.1.1.3 Industry l
The rule would require licensees to consider particulars of compliance in the areas of funding assurance, planning, recordkeeping, and license termination procedures including termination surveys. Currently, regulations concerning decommissioning requirements are limited or vague. Case-by-case action has been used to effect licensing requirements. The amendments would allow licensees to ,
satisfy decommissioning requirements, many of which are already required on an ad-hoc basis, more efficiently and cost-effectively. In situations where addi-tional requirements would be imposed, such as in areas of funding assurance, requirements have been kept to the minimum that ensures that health, safety, or the environment are not compromised. As an example, decommissioning a modern i day reactor results in an occupational dose of approximately 2000 man-rem.
Improper decommissioning practices through spread of contamination and actual I decommissioning activities can double this dose. Thus the rule could result
! in signficant health benefits to reactor facility employees.
4 l 2
12 Enclosure B j
Finally, an additional benefit of these amendments is that licensee compliance would eliminate some of the 10 CFR Part 51 requirements concerning decommis-sioning.
Amendments can be classified into two basic types: type 1 - those which relate to the licensing of any facility under 10 CFR Parts 50 and 72; type 2 - those which relate to licensing possession and use of radioactive materials as in 10 CFR Parts 30, 40, and 70.
The majority of type 1 licenses are power and research and test reactors, while the majority of type 2 licensees are non-fuel-cycle facilities. There are only a small number of fuel cycle facilities; however, there are approximately 20,000 non-fuel-cycle facilities (including Agreement State licenses). It is estimated that approximately 40% of these could be considered small entities I under the criteria set out in the recently adopted NRC size standards (51 FR 50241) for use in determining which of NRC's licensees are small businesses entities. The NRC size standards for entities to be considered as small businesses are as follows:
For most licensees, annual billings of $3.5 million or less; For private practice physicians, annual billing of $1 million l or less; For state or public educational institutions, the institution is supported by a jurisdiction with a population of 50,000 or less; and For other educational institutions, the institution has 500 or fewer employees.
(Note: Development of such information by the NRC is in a NUREG/CR entitled, Impact of Proposed Financial Responsibility Requirements On Nuclear Material Licensees by Battelle Northwest Laboratory (to be published). The NUREG is part of the information base for considering 13 Enclosure B
s licensee financial requirements for cleanup of both onsite and offsite accidents and environmental restoration of material resources.)
i The benefits of the rule requirements for the major decommissioning elements, using the classifications are:
Funding Assurance - The regulations require either (1) a certification that the 8
licensee has provided financial assurance in amounts at least equal to that i r
prescribed in the rule and methods of funding or, (2) approval of a funding i plan (including provisions for periodic update) requiring an estimate of !t i decommissioning cost as well as a prescribed method for providing assurance. t For power reactor licensees, type 1, rule prescribed amounts for certification, depending on design and size, cre required. These amounts are based on the most current information available and the extensive NRC data base developed in ;
support of this rulemaking. It is not intended that the prescribed amounts be !
- exact but rather that they cover the bulk of the expected decommissioning costs !
l a within the context of reasonable funding assurance. For power reactors, annual !
4 updating of cost will be required as prescribed in the rule. For research and !
5 j test reactors there is a wide diversity of types and it is difficult to pres-i cribe meaningful certification amounts. For these reasons research and test !
reactors must submit funding plans. Similarly, for these sarne reasons material f
q licensees (type 2) hr.ving large potential for radioactive contamination would also be required to submit funding plans. The majority of type 2 licensees are l
excepted from this requirement. A wide latitude of methods for providing f funding will be allowed within the bounds of reasonable assurance that funds i l will be available to decommission the facility in a safe and timely manner l
(including provision for premature closure). The funding assurance require- i
[
] ments allow the licensea to implement a method of funding with long lead time
{'
and during the time that the facility is operating so that funding requirements l can be considered with other revenue requirements.
l l 5
I For type 1 licenses - reasonable assurance of funding capability allows utili- '
I ties to use the external reserve funding method in which the collection of fees ,
from the rate payer must be invested in assets outside of company control. i Assuming such funds earn a reasonable rate of return the incremental cost of ,
i i i 14 Enclosure B !
I i
such a funding method (compared to no rule) can be zero. There are various ways of modeling the cost of the various funding methods used (Refs. 15 and 18) !
and depending on the assumptions used could lead to results such that the cost f
l of external reserve is less than prepayment. Moreover, with respect to i
- premature closure the reasonable assurance requirement takes into consideration l 10 CFR 50.54(w) that requires an electric utility to obtain onsite property '
j damage insurance. In comparison to possible costs that would result from i 4,
accident cleanup, decommissioning costs are ,small (on the order of $110-130 I million in 1986 dollars compared to as much as $1 billion). It is expected ;
that required on-site property damage insurance for such accident cleanup would 4
allow a utility to remain financially solvent even in the case of an accident. 1 Thus a utility should have adequate financial resources to pay for the cost of '
decommissioning following accident cleanup. ,
E i Recognition by the utility at an early time of the necessity of including !
l decommissioning costs into the rate base would further minimize overall !
economic impact. Most research and test reactors are Federal or State owned or i J
are part of large universities. State or federal statement of intent that
- funds for decommissioning will be made available would be considered reasonable 4
assurance for funding; knowledge of the funding requirement by appropriate agencies would allow for adequate budget planning. For independent spent fuel j storage installations, of which there is one under Part 72 license, the funding P
[
assurance is essentially the same as that already required in 10 CFR 72.18(b).
For type 2 licenses - the majority of type 2 licensees, while financially j responsible for decommissioning costs, are excepted from funding assurance
- requirements. For the other licensees (about 1500 NRC licensas) some type of
{
j funding assurance is required. However, for many of those a certification that
(
] the licensee has provided financial assurance in the amount and methods pres-I cribed in the rule would be sufficient. For the remainder (about 828 NRC licenses) a financial plan indicating amounts and methods of assurance for pro-
) viding decommissioning funds would be required. All sealed source users,
) except those using source material greater than 1010 appendix C values of
) 10 CFR Part 20 (10,000 Ci for Co-60 and 100,000 Ci for Cs-137) would be 1
) excepted. Also excepted would be plated foils or equivalent source material in I
- a non-readily-dispersible form. Moreover, all licensees with materials of j 15 Enclosure B i
4 l
s half-lives not exceeding 120 days would also be excepted as would those licensees with possession limits less than or equal to 103 times the curie content specified in 10 CFR Part 20, Appendix C for Part 30, 40, and 70 licenses. Thus the majority of small businesses would be excepted, especially hospitals which primarily possess short half-life radioactive materials. Specification of a tiered system based on possession limits for fixed amounts of required financial assurance, aside from eliminating a majority of type 2 licensees having minimal risk, results in a more implementible system both for the licensee who does not have to provide the NRC with a decommissioning funding estimate as well as the NRC in the administration of the requirement to ensure that the licensee has provided adequate financial assurance. Moreover, for those licensees requiring a financial assurance plan, the plan would only be required at license renewal at which time it is much more efficient for the licensee and staff to implement as part of the overall renewal e % rt. All affected licensees, including . hose requiring a funding plan at renewal would have two years from the date that the rule becomes effective to acquire prescribed funding assurance. Those licensees requiring a funding plan would provide to the NRC a funding certification for
$750,000 until a funding plan was submitted at license renewal. In general, funding assurance amounts have been based on the PNL data base. Decommissioning a typical laboratory of a facility in 1986 dollars is estimated to cost about
$150,000 and this is the requirement for those Part 30 and 70 licensees having possession limits greater than 1000 but less than or equal to 10,000 times the curie limits prescribed in 10 CFR rt 20 Appendix C. For Part 40 licensees, this is also the prescribed amount for those licensees having source material limits greater than 10 mci but less than or equal to 100 mci; for those Part 40 licensees havinq possession limits greater than 100 mci a financial plan would be required. For Part 30 and 70 licensees having possession limits greater than 10,000 but less than or equal to 100,000 times the possession limit values of 10 CFR Part 20 Appendix C, the amount of assurance required would be
$750,000 (the equivalent cost of decommissioning 5 typical laboratories); for those above this limit a funding plan would be required. All affected licensees who do not require a funding plan may still submit one for approval if they feel the prescribed assuranc costs are too high. It is not expected that many would do this, however, because it is felt that the prescribed costs are 16 Enclosure B
s reasonable. If a surety method were used for providing this assurance which ,
costs about 1-2% annually of the value of the surety, then this further reduces any incentive to submit a funding plan, especially when it is recognized that !
the cost of the surety is a business expense and is tax deductible; depending on the size of the licensee such deduction would be in the 25-50% tax bracket.
Recordkeeping - The licensee is already required to keep records for various limited times of such things as unusual occyrrences involving the spread of contamination and as-built drawings or other information which can affect occupational health and safety. The rule requirements on recordkeeping could be satisfied by keeping a central updated reference file of already generated records that have potential for relevance to decommissior.ing such as instances when significant contamination remains after any cleanup procedures or when there is reasonable likelihood that contaminants may have spread to inacces-sible areas as in the case of seepage into porous material such as concrete or if any radioactive material has been buried. Relevant records must be kept until the facility is decommissioned. This information could minimize radia-tion exposure as well as greatly reduce actual decommissioning costs. Decom-missioning experience has shown that a lack of sufficient historical information can result in increased dose to occupational wor kers, difficulty in planning and cost estimating, inefficiency in the decommissioning process and delay in completing decommissioning.
For type 1 licensees - besides the initial planning of recordkeeping and funding assurance final planning would be required. Final planning is already required in existing 10 CFR 50.82 but only when the licensee desires to dismantie. For a power reactor such planning would be elaborate because of the complexity of the facility being decommissioned. Therefore, at or about 5 years prior to the end of operation of the reactor, the licensee is required to provide a cost estimate for decommissioning based on major decommissioning cost elements and conditions current at that time. This requirement serves a twofold purpose.
First, it simplifies the final plan submittal for both the licensee and the NRC (and for implementation purposes can b3 cansidered oart of the final plan '
"aquirements). Second, it provides needed additional assurance that licensee aecommissioning funding provisions are adequate. In fact, the use of tha 17 Enclosure B
l required cost estimate coupled with the initial certification requirement pro-vides a total package of reasonable assurance, allowing the simpler certifica-tion requirement to be used instead of an initial funding plan requirecaent.
Preparation of the final plan (including the cost update) allows for a more efficient and direct use of licensee time.
For type 2 licensees - as with type 1 licensees, aside from funding assurance and recordkeeping considerations, decommissioning plans may we required at the time of decommissioning and would depend on the complexity of the decommission-ing. Such plan requirements have already been approved by some case-by-case licensing decisions. For the large number of non-fuel-cycle licensees, plans would not be required because the decommissioning work could be performed prior to requesting license termination. All that might be required is a notifica-tion of a desire to terminate the license as well as a termination survey or other information that demonstrates that the facility is suitable for unre-stricted use.
Termination Procedures - Specific requirements as to how a licensee can termi-nate a license including administrative procedures as well as technical require-ments should result in efficient, less costly efforts. Specifically in the technical area, requirements for the performance of acceptable termination sur-veys can speed up the NRC termination of license.
For type 1 licensees - a survey plan would be required for NRC approval. Proper implementation of this plan by the licensee would allow the NRC to terminate the license promptly. 1 For type 2 licensees - For some licensees, submittal of a final decommissioning l plan would be required. However, for most licensees only the results of a termination survey or other information of an equivalent nature would be needed.
For the more complex facilities, or those where large areas need to be surveyed, the licensee may choose to have a termination survey plan approved by the NRC l prior to execution so that the license could be terminated when the survey was properly implemanted.
18 Enclosure B
4 1
t
. I It should be noted trat specific criteria for residual radiation limits accent-able for terminating a license are being considered for separate rulemaking _
activities. !
Other Considerations - Mitigation of adverse mvironmental impact from decom-missioning will occur provided that the rule amendments to Parts 30, 40, 50, 70, and 72 are imolemented. However, reduction of 10 CFR Part 51 requirements by elimination of the mandatory requirement for an envirormental impact state-ment for type 1 licenses is warranted and will eliminate some requirements for such considerations in environmental reports, assessments and impact statements.
4.1.1.4 Public The requirernents set forth in this rule will minimize licensee decommissioning impacts on health, safety and the environment. Moreover, financial requirements will ensure that decommissioning is done as promptly as reasonable and that a non-operational facility does not become a public burden. From a financial aspect, especially for power reactors, requirements for funding assurance may minimize rate payer c.osts relating to decommissioning.
It should be emphasized that for decommissioning that is done properly, espe-cially for power reactors, the major impact on health and safety is to the occu-pational workers. Improper decommissioning activities could increase occupational dose (nominally about 2,000 man-rem) by a factor of 2 or more. The impact on the public dose could also be substantial. This is because a lack of proper planning (such as poor recordkeeping) and improper implementation of a decom-missioning plan could result in a contaminated facility with potential for serious radioactive effluent release to the public through water, air or direct radiation pathways. A lack of funds could further exacerbate tiis problem by causing additional decommissioning delay and contributing to the potential for further public dose. Thus improper planning, financing and execution could ,
result in situations where a significant radioactive source can result in dose pathway to populations, resulting in large man-rem numbers.
19 Enclosure B 1
s 4.1.2 Costs The major cost impact of the rule amendments is in the area of funding assur- 1 ance.
For type 1 licensees - other cost impacts for existing licenses are associated with recordkeeping. Also, at the end of facility life, the new requirements could add sometadditional requirements to what is presently required of licensees.
For type 2 licenses - other cost impacts are in the area of recordkeeping.
Also, at the end of facility life, for those licensees requiring a final plan, some additional requirements could be incorporated into the licensing require-ments beyond those incorporated into present licensing conditions.
Detailed considerations of cost impact for the NRC, other government and state agencies, the industry, and the general public are presented in the remainder of this chapter.
General estimating data relative to interpreting rasults presented is the use of a 235 day work year (49-5 day weeks less 10 holidays) and a worker rate of
$40/hr which is aimed at the technical staff level thought to be needed for the majority of the required efforts described. Thus a man year of effort results in a cost of $75,000.
4.1.2.1 NRC For type 1 licenses - the major resource impacts are estimated to occur within the first 2 to 5 years following promulgation of the finsi rule amendments dur-ing which time decommissioning certification or funding plans would be required of all licensees (and would be submitted within 2 years from effective date of rule). Inspection resources have been treated as requiring a minimal effort as a result of the rule requirement. Such inspection efforts can be incorporated as part of routine activities or are already being performed during actual dscommissioning activities.
20 Enclosure B
1
~
In 1986 there were approximately 100 operating power reactor licenses (and about 20 under construction) and NRC review of the funding report will result j in an estimated 3-day effort. For purposes of impact estimating it is assumed that 50% of the power reactors under construction will be completed (about 10) and thus will be affected by this rule along with the already operating power reactors resulting in a total of 110 power reactors. Thus for all presently operating power reactors this results in about 1.4 man-years effort and a cost of about $105,000. Estimating that this effort occurs over 3 years results in an expenditure of about $35,000/yr. There are also approximately 75 research and test reactors of varying size and complexity. Using an average of 4 days of effort for review and approval of the funding plan results in an estimated effort of about 1 man year at a cost of about $75,000 resulting in an annual cost of approximately $25,000 spread over 3 years.
Thus the total effort is estimated as 2.4 man years at a cost of about $180,000 or $60,000/yr over 3 years.
Other impacts were estimated at the operating and decommissioning stages:
(1) During reactor operations, total NRC staff requirements are estimated at 0.4 person year / year (about 1/2 day per facility) or $30,000/yr for ensur-ing that NRC financial report and recordkeeping requirements are being implemented.
1 (2) At the decommissioning stage, (including cost estimating requirements occurring 5 years prior to predicted end of operational life) it is expected that there will be a considerable spread in time when actual decommissionings take place and its impact on an annual basis should be !
small. Decommissioning has to be reviewed even under existing regulations and overall administrative effort should be reduced at this time because of more specific requirements. Elimination of the mandatory requirement for an environmer.tal impact statement will result in routine use of the simpler environmental assessment. This is all that was required prior to a recent revision to 10 CFR Part 51.
21 Enclosure B l
)
\
l For type 2 licenses - the major resource impacts are estimated to occur within 1 to 5 years following rule amendment finalization primarily from funding assur-ance requirements for existing material licenses that have not been excepted.
It is estimated that a funding plan consisting of a cost estimate and a method of providing assurance will be required of about 828 licenses. Funding plans would be required at the time of license renewal (once every 5 years) and so efficiency of staff effort would be optimized. Moraover, it is expected that funding plan updates at license renewal would be very minimal and would primar-ily be based on considerations of inflation. Thus, no cost is considered for NRC funding plan cost estimate update review at license renewal.
Licensees that require a plan as well as those affected but not requiring a plan would require a certification that funds have been assured by prescribed methods and amounts specified in the rule. This would require little NRC staff effort. It is estimated that staff effort in evaluating and approving of a funding plan would require about 6 man days on average resulting in about 21 man years at a cost of approximately $1.6 million spread over 5 years or
$320,000/yr.
Other impacts were estimated during plant operation and decommissioning:
(1) During plant operation, NRC inspection staff requirements are estimated as 0.9 person year / year (1/4 day per facility) or about $68,000 'or assuring that rule amendment requirements are being implemented.
(2) At the decommissioning stage it is estimated that there will be consider-able spread in time when actual decommissioning occurs. It is also expected that except for the complex and costly facilities to decommis-sion, primarily fuel cycle or large non-fuel cycle ones (of which there are only few), most licensees will complete decommissioning requirements prior to their request for license termination and all that will be required is confirmation that an acceptable termination survey had been done, or equivalent proof of acceptability, and residual radioactivity levels allow for unrestricted use of the facility and termination of I license. The requirement for a decommissioning plan is already required in the recent amendments to 10 CFR Part 30, 40, and 70 specifying licensee 22 Enclosure B
s responsibility for nuclear materials and procedures for termination of of specific licenses (48 FR 32324, July 15,1983). These amendments have been incorporated into the proposed rules to ensure uniformity of style as well as completeness.
A summary table of NRC manpower effort for type 1 and 2 licenses in terms of manpower and cost is presented in Attachment B.
4.1.2.2 Other Government and State Agencies Other state or government agencies are not expected to be significantly cost impacted. For state or Federal licensees, such as test or research reactors, funding assurance allowing for state or Federal agency statement of intent will limit impacts and provide for a moro efficient method of funding preparation.
It is estimated that 75% of research and test reactor licenses are federal or state owned and that funding plans plus recordkeeping requirements for the approximately 60 reactors would cost $75,000/yr over 3 years (see Sec-tion 4.1.2.3, 3rd paragraph).
Agreement states must maintain comparable requirements, and will have similar impacts as that to NRC to implement these requirements. Type 2 licensees only are involved and a similar number are expected to be affected. Thus, the total impacts to all Agreement States would be similar to the impacts to NRC asso-ciated with type 2 licensees.
4.1.2.3 Industry For type 1 licenses - major impacts would be in the financial assurance provi-sions and in recordkeeping. For power reactors, funding assurance requirements are specified as rule prescribed decommissioning costs, based on design and size of the reactor considered, together with a method for providing reasonable assurance that such funds will be available for decommissioning (also rule l prescribed). Other type 1 licensees will be required to make an initial cost l
estimate. Licensees and applicants can base estimates of decommissioning costs on the Battelle Pacific Northwest Laboratory reports on technology, safety and 23 Enclosure B l
\
l costs for decommissioning as well as a regulatory guide. The proposed amend-ments indicate that collection of funds which can be kept in an external reserve -
account provides reasonable assurance of availability of funds for power reactor licensees.
The majority of licensed test and research reactors are owned by the State, Federal Government, or large universities. Reasonable funding for those not owned by the State or Federal Government would require a funding assurance method. This could be in the form of a broad variety of alternatives prescribed in the rule. In the most costly case, such as a surety, an annual cost of 1-2%
of the face value of the surety would result (which for most would not exceed
$20,000/yr) and could be reduced as funds are set aside in an external sinking fund to pay for the cost of decommissioning so long as the surety coverage plus accumulated funds are adequate.
It is estimated that satisfying the financial assurance and recordkeeping requirements for power reactors would take about 14 days (4 days on recordkeep-ing and 10 days on financial assurance implementation). This would result in an effort for the approximately 110 operating reactors (includes 30 under con-struction) of about 6.6 man years at a cost of approximately $495,000. When spread over 3 years this would result in a cost of $188,000/yr. For research and test reactors, the funding plan as well as the recordkeeping effort is esti-mated at about 11 days on average resulting in a cost of about $3,700 per reac-tor. Assuming 25% of these are industry owned, this would result in a cost of
$75,000 which when spread over 3 years results in a relatively minor cost of {
$25,000/yr. Other impacts were estimated at the operating and decommissioning stages:
(1) During the operational stage costs are estimated as less than 0.5 person- !
year / year ($38,000/yr) for the total industry.
(2) At the decommissioning stage, plans are already required by current rules.
Explicit requirements (including cost estimating requirements 5 years prior to expected end of operational life) would make this process more efficient. Moreover, it is expected that such explicit requirements would 24 Enclosure B
~
- 1 allow for a simpler presentation of environmental report requirements resulting in some reduction in cost. _
For type 2 licenses - major impacts would be in the funding assurance require-ments. Details of the results presented here can be found in Attachment A. A cost estimate for decommissioning and a method of providing assurance would be required of about 1656 such licensees; it was estimated that the number of NRC and state licenses are comparable. Based on this~it is also estimated that an additional 252 licensees will each require certification of funding assurance of $750,000 and about 468 others will each require assurance of $150,000. Also for affected large sealed sources licensees (about 602), assurance of $75,000 ,
will be required. The proposed rule amendments allow as much flexibility as possible for providing such assurance, in order to reduce the impacts. It is likely that many licensees (especially small licensees) will choose a surety or other guarantee method. This is estimated to cost 1-2% of its face value annually. However, this cost can be considered an operating business expense for tax purposes resulting in a saving of between about 25-50% depending on the size of the licensee. If a surety method is used, then this is estimated to cost $16 million annually ($2,250 to $7,500 per licensee). Licensees requiring plans are expected to utilize other allowed funding methods such as external sinking funds which may reduce funding assurance costs. It is also expected that many other licensees will use other allowable fundir.g assurance methods, thereby reducing these estimated costs. For small entities, it is expected that the majority will be excepted (especially for medical licenseec) because of the exceptions for half-lives less than 120 days, most sealed sources, Part 30 and 70 licensees possessing material less than or equal to 1000 Appen-dix C values of 10 CFR 20, and Part 40 licensees possessing source materisis less than or equal to 10 mci. For those small entities affected (about 276 licenses) it is estimated that at worst the annual cost of maintaining suroties is about $840,000 annually ($2,250 for the majority of licensees).
These small entities would be almost exclusively industrial licensees. Histor-ical information indicates that such small industrial licensees are the most likely to default and it is particularly important that these licensees provide financial assurance to ensure that health and safety will not be compromised because of a lack of funds to decommission.
25 Enclosure B I
)
s 1
For those licensees where a funding plan is required, it is estimated that the l
cost of developing such a plan based on a 12 day effort is about 85 man years _
at a cost of $6.4 million or spread over 5 years, $1.28 million/yr. No cost is considered for f nding plan cost estimate updates because this occurs at license renewal and efficiency of effort can be optimized. Moreover, it is expected that this effort will be very minor and primarily pertain to consideration of inflation.
Other additional requirements such as recordkeeping considerations are expected to have minor impact and are considered to be consistent with good practices.
No plan is required and recordkeeping can be as simple as maintenance of a centralized reference file.
Impacts during operation or termination of license are judged minor. For the majority of licensees, decontamination and surveys can be conducted under the operating license and no plan will need to be submitted. For those facilities which are complex and costly to decommission, detailed plans are already required. These requirements have recently been included in amendments to 10 CFR 30, 40, and 70 and have been incorporated into this proposed rule for uniformity and completeness.
4.1.2.4 Public The public, as user of electricity, has to pay for the cost of decommissioning as a routine cost and thus decommissioning costs in themselves do not consti-tute a special impact. However, major potential cost to the public could come from a lack of financial assurance resulting in inadequate or nonexisting licensee decommissioning funds and lead to an inability to expediently decommis-sion. Such a situation would result in a public risk. Use of proper practices through regulatory requirements would minimize this ,rossibility as well as tend to keep decommissioning. costs to a minimum.
- 5. Backfit Analysis for Power Reactors The Commission has determined, on the basis of the record in this rulemaking, that the backfits which will be imposed as a result of this rule 26 Enclosure B
\
are necessary to ensure the adequate protection of public health and safety.
, Therefore, under sectio _n (a)(3) of the backfit rule, 10 CFR 50.109, neither a backfit analysis nor application of the backfit rule's cost-benefit standards is required for this rule. The regulatory analysis of these amendments con-stitutes the documented evaluation required by section (a)(4) of the backfit rule. This analysis contains the objectives of, and reasons for, the backfits entailed by these amendments and provides the basis for claiming that these backfits are necessary to ensure adequate protection to public health and safety.
- 6. Decision Rationale
\
Assessment of the costs and benefits of the proposed amendments in the preceding sections leads to the conclusion that overall there will be a moderate increase in costs to the NRC, State and Federal agencies, industry, and other licensees and an important increase in the effectiveness of decommissioning activities that will ensure that impacts on health, safety and the environment are minor.
Therefore, the proposed action is recommended. No alternatives, other than rule amendments were judged to be satisfactory. This decision is supported by both quantified cost data and a reasoned judgment on improvements to health, safety and the environment.
- 7. Implementation (a) Schedule No implementation problems are anticipated. The framework for implemen-i tation is already established in the NRC, State and Federal agencies, and the industry. Major impact from initiating the rule has been minimized by allowing phase in time of requirements after rule finalization. For type 1 and type 2 licensees, this is 2 years for submittal of funding informa-tion. For those licensees requiring a funding plan, such plans are required to be submitted at the time of license renewal.
27 Enclosure B
(b) Relationship to Other Schedules Issuance of a notice of filing of a FGEIS with EPA will be published at the same time that the final rule is issued.
i I
L 3
l 1
2 i
.\
28 Enclosure B rv m4,-- v---~~ p c-sq --
ww-,ww y n - e -- -,,,emym_.,,,--g-m n w w e- - mm e, -o, m nw w -w rw ,- gnw mwwww, m ,w mw w w -or - mm www w m www www se~ww m y w ~,* -ww
e -
'l
\
l
. i ATTACHMENT A !
Cost to Affected NRC Material Licenseest Total Cost * - Millions Number of of Dollars (2% of Surety Licenses less tax rebates)
Licensees requiring plans and/or -
certification for $750,000 828 6.2 Licensees requiring certification for $750,000 , 126 0.95 Total 7.2 Licensees requiring certification 234 0.53 of $150,000 Sealed Source licensees requiring ;
certification of $75,000 301 0.35 Overall 8.0
- For licensees requiring $750,000 certification or more use 50% tax bracket. '
For licensees requiring $150,000 or less use 25% tax bracket. . ,
tit is estimated that Agreement State licensees are equal in number and that Agreement States would have equal costs.
Estimate that the number of Agreement State licensees are equal in number and thus overall cost impact is doubled. Therefore, surety cost for all affected licensees would be 2 x $8 million or about $16 million annually. '
For small businesses, it is estimated that 50% of the licenses requiring
$150,000 certification plus 10% of those requiring $750,000 certification plus 1% of those requiring a plan are affected. This results in about 138 affected NRC small business licenses and a surety cost of 1% of 6.2 million plus 10% of
$0.95 million plus 50% of $0.53 million or about $0.42 million/yr. Thus, doubl-ing these numbers results ia an estimated total of small business licenses of l 276 at an annual cost of $0.84 million. i l
L
. l 1
l l
J 29 Enclosure B 1
)
\
ATTACHMENT B Effect and Cost of Proposed Rules to NRC Manpower Cost Duration License Type NRC Office (man-year) (thousands /yr) (years)
Part 50 and 72 NRR 0.8 60 3 Regions 0.2 15 over period of license NRR 0.2 15 over period of license i NMSS negligible Part 30, 40, and 70 NMSS or .
Regions 4.2 funding 320 5 plan Regions 0.9 68 over period of license i
)
1 i
l l
l j 30 Enclosure B :
1
._ . - - - - _ . - - - --. . . . . . - _ - _ _ _ - - - - _ . - _ , - . - . . _ . ~ .
% s D
6 I'
i 4
M ENCLOSURE C i
I i
e i
9 l
l DRAFT C0FGRESSI0fu' LETTER l - .
Dear Mr. Chairman:
Enclosed for your information is a copy of a Notice of Final Rulemaking pertaining to decommissioning of nuclear facilities.
The final rule sets forth financial and te~chnical reouirements for the decomissioning of licensed facilities and is a result of a reevaluation of the Comission's decorrmissioning policy. An Advance Notice of Proposed Rulemaking was published on March 13,1978 (43 FR 10370) announcing that the Comission was reevaluating its decommissioning policy. A Draft Generic Environmental Impact Statement (DGEIS) was published, and a notice published announcing its availability for public comment on February 10, 1981 (46 FR 11666). A notice of proposed rulemaking on decomissioning criteria for nuclear facilities was published for public coment on February 11, 1985.
This final rule is based on an extensive data base which has been developed as part of the reevaluation and considers coments received on the Advance Notice, the draft GEIS, the proposed rule, and discussions with the states at five workshops. A Final Generic Environmental Impact Statement on Decomis-sioning Nuclear Facilities has been published.
The final rule defines decomissioning as always leading to unrestricted use of property. The final rule reauires that financial assurance for decom-missioning be provided by reactor licensees and other licensees with potential for ma,ior decomissioning costs. A number of alternative methods of providing this assurance are allowed.
The final rule also requires that appropriate records be kept to be sure adequate information is available at the time of deconmissioning.
More specific criteria for planning for decomissioning are also provided. '
Enclosure C MS
.l r '
2 Also enclosed is a copy of a public announcement that will be released by the Comission in the next few days.
Sincerely, Eric S. Beckford, Director 9
' Office of Nuclear Regulatory Research
Enclosures:
As stated
, t i
1 n
i i
. i
4 1
l i
l
\
ENCLOSURE D e
9 9
4 4
89%
Draft Public Announcement NRC ISSUES RULES ON GENERAL REQUIREMENTS FOR DECOMMISSIONING NUCLEAR FACILITIES The Nuclear Regulatory Comission is amending its regulations to include technical and financial criteria for decommissioning licensed nuclear facilities. The existing regulations cover decomissioning requirements only in a limited way.
The amended regulations deal with decommissioning planning needs, timing, funding mechanisms and environmental review reouirements. The rules provide assurance that licensed nuclear facilities will be decommissioned in a safe and timely manner and that adequate funds would be available for decomissioning purposes.
The amendments apply to all NRC licensees except licensees for uranium mill and mill tailings, low-level radioactive waste burial facilities, and high-level radioactive waste repositories, which have been addressed in separate regulatory actions.
The amendments define decommissioning as removing from service and reducing residual radioactivity to a level that would permit release of the property for unrest'ricted use and termination of license.
Three acceptable decommissioning alternatives are contemplated but not specified in the rules. They are:
DECON: under this alternative, equipment, structures, and portions of the site contaminated with radioactivity would be removed or decontaminated to a level which would permit the property to be released for unrestricted use shortly after operations have been terminated. It would satisfy the objective of unrestricted release of the property in a much shorter time period than the other alternatives while protecting the health and safety of workers and members of the public.
Enclosure D n,
-._ _ __ , y _ .-w m._ . .- .v.__.- ,7
2 SAFSTOR: under this alternative, the nuclear facility would be placed and maintained in such a condition that it could be safely stored and decontaminated to levels which would permit release for unrestricted use at a later date. It would be an acceptable alternative if radiation doses to workers involved in the decomissioning process would be reduced significantly or in cases where almost all of the radioactivity would decay within a few months or years. It could also become necessary in other cases such as a shortage of offsite radioactive waste disposal space. '
ENTOM8: under this alternative, radioactive materials would be encased in a structurally 1,ohg-lived material such as concrete and the structure would be maintained and surveyed until the radioactivity had decayed to a level , permitting '. ; unrestricted release of the property. This alternative could reduce. radiation doses to workers as well as the volume of radioactite
=
waste but would be expected to be of limited use because of practical l l
considerations.
The amendment requires that decomissioning begin shortly after nuclear l 1
facility operations have been terminated and that the time to reach unrestricted use be minimized.
Planning for decomissioning is divided into two parts: initial and l
final.
Initial asoects af plannina are financial planning and facilitation of decommissioning. Current license holders and applicants for new licenses have to submit either funding plans or certification of financial assurance in amounts which may be greater but not less than that specified in the rules.
For power reactors, the mounts vcry based on the type and size of the reactor; for materials focilities the amounts depend on the quantity of
~
licensed material possessed. Funding plans will have to include a cost estimate and identify a means of providing financial assurance for decommis-sioning. Generally, facilitation of decomissioning should be considered under the principle of keeping exposures to radiation as low as reasonably achievable; the rule requires specifically only that relevant records be kept to assure adequate information is available at the time of Jecomissioning.
k$
3 I
Final planning involves the submission of decommissioning plans for review and approval in advance of initiation of any major decommissioning activity where a significant health and safety ouestion could be involved. These final plans have to include as appropriate:
(1) a description of decommissioning procedures to be used including plans for processing and disposing of the radioactive waste; (2) a description of methods used to ensure the safety of workers and members of the public; (3) a plan for a final radiation survey to ensure that the property is suitable for release for unrestricted use; (4) a cost estimate to ensure that adequate funds will be available before decommissioning activities are initiated; and (5) a description of quality assurance and safeguards provisions if appropriate for the specific licensee.
A number of alternative methods for assuring that funds for decommissioning
-- either prematurely or at the end of operations -- will be available are set forth in the rules. They include:
(1) Prepayment--under this alternative, funds would be set aside, prior to commencement of operations, in an account segregated from other licensee funds. l (2) Surety, insurance, or other guarantee method--this alternative includes methods to guarantee, including parent company guarantees, that deccamissioning costs will be paid should the licensee default.
l l
Pps
. o 15 e,
(3) External sinking fund--under this alternative, funds would be set aside periodically over the life of the facility in an account segregated from other licensee funds. This segregated account would be coupled with a surety guaranteeing funds for decommissioning in the event of licensee default unless the licensee is an electric utility.
i (4) Statement of intent by Federal, State, or local government licensees, as appropriate, that funds for decommissioning will be obtained when necessary.
The new requirements will reduce the specific requirements for environmental reviews related to decommissioning by:
(1) Providing that the decommissioning of reactors and certain materials facilities will no longer reouire environmental impact statements unless specifically determined by the Commission; environmental assessments will be prepared, however.
(2) Providing that information concerning environmental impacts will be submitted by licensees as a supplement to previously developed environmental reports.
The requirements for decommissioning, written as amendments to Parts 30, 40, 50, 51, 70 and 72 of the NRC's regulations, will be effective on .
l I
l I
i