ML20207L608

Requests Exemption for Insurance Coverage Amount Set Forth in 10CFR50.54(w).Exemption Would Be Become Effective After Transfer of TMI-1 Facility OL to Amergen Energy Co,Llc

ML20207L608
Person / Time
Site:	Three Mile Island
Issue date:	03/09/1999
From:	Langenbach J GENERAL PUBLIC UTILITIES CORP.
To:	NRC OFFICE OF INFORMATION RESOURCES MANAGEMENT (IRM)
References
1920-99-20104, NUDOCS 9903180197
Download: ML20207L608 (4)

Text

e l GPU Nuclear, Inc.

( Route 441 south NUCLEAR Post Office Box 480 March 09,1999 Middletown. PA 17057-0480 Tel 717 944 7621 1920-99-20104 U.S. ' Nuclear Regulatory Commission Attn: Document Control Desk Washington, D.C. 20555

Subject:

Three Mile Island Nuclear Station, Unit 2 (TMI-2)

Possession Only License No. DPR-73 Docket No. 50-320 Request For Exemption From The Insurance Coverage Limit Of 10CFR50.54(w)

GPU Nuclear, Inc. (G1 UN), on behalf ofitself and its afliliates, Metropolitan Edison Company, Jersey Central Power & Light Company, and Pennsylvania Electric Company, as the NRC licensee of Three Mile Island Unit 2 (TMI-2) hereby requests an exemption for TMI-2 from the insurance coverage amount set forth in 10CFR50.54(w). This exemption is requested in accordance with 10CFR50.12, " Specific Exemptions." The exemption would become etTective after the transfer of the Three Mile Island Unit 1 (TMI-1) facility operating license to AmerGen Energy Company, LLC (AmerGen).

TMI-2 is permanently shutdown and licensed as a possession only facility. TMI-2 Post Defueling Monitored Storage (PDMS) Safety Analysis Report (SAR) describes TMI-2's status as follows:

"TMI-2 has been defueled and decontaminated to the extent that the plant is in a safe, inherently stable condition suitable for long-term management and any threat to the public health and safety has been eliminated. All fuel and core debris which have been removed from the Reactor Vessel 1 and associated systems have been shipped off-site." This same conclusion is reflected in the i f

NRC's Safety Evaluation Report related to PDMS. O EXEMPTION REOUESTS GPUN hereby requests an exemption from the requirement of 10CFR50.54(w), which requires licensees to maintain $1.06 billion in on-site property damage insurance coverage for each reactor station site. GPUN requests that after transfer of the TMI-1 license to AmerGen, GPUN be .

permitted to maintain $50 million in on-site property damage insurance coverage for TMI-2. This request would not affect the insurance coverage that AmerGen would be required to maintain for TMI-l as the licensee of an operating reactor, pursuant to 10 CFR 50.54(w), except that the k

property damage insurance coverage for TMI-l would be limited to the TMI-l site. Upon NRC approval of this exemption request, GPUN intends to obtain a separate on-site property damage insurance policy for TMI-2 to become effective upon the date of the referenced transfer of the TMl-1 operating license. The separate policies for TMI-l and TMI-2 will include appropriate 9903180197 990'309 1 PDR ADOCK 05000320 <

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1920-99-20104 Page 2 of 4 cross contamination clauses designed to hold the other party harmless from any contamination which that party's Unit may cause to the other.

DISCUSSION l The financial protection limit of 10CFR 50.54(w) was established to require a licensee to maintain sufficient insurance to cover the costs of on-site property damage resulting from a nuclear accident at an operating reactor. Those costs were derived from the expected consequences of a release of radioactive material from the reactor. In an operating plant, the high temperature and pressure of the reactor coolant system, as well as the inventory of relatively short lived radionuclides, contribute to both the risk and consequences of an accident. In a permanently shutdown and defueled reactor, the reactor coolant system will never be operated and contains no short-lived radionuclides, which eliminates the possibility of reactor accidents. A further reduction in risk occurs when the fuel is shipped offsite. Thus, the potential for a significant release of radioactive material has been eliminated at TMI-2, for which the 10 CFR 50.54(w)

$1.06 billion on-site insurance coverage is otherwise required.

In SECY 96-256, " Changes to the Financial Protection Requirements for Permanently Shutdown Nuclear Power Reactors,10 CFR 50.54(w) and 10 CFR 140.11," dated December 17,1996, the NRC staff estimated the on-site cleanup costs of accidents considered to be the most costly at a permanently defueled site with spent fuel removed from the site, and with the on-site radioactive liquid inventory greater than 1000 gallons. Although a small amount of fuel debris remains at TMl-2, the NRC Safety Evaluation for TMI-2 Technical Specifications Amendment #48, dated December 28,1993, states in part that "no credible accident could result in the release of radioactive materials to the environment in quantities that would require protective actions for the public, and there is reasonable assurance that the health and safety of the public will not be endangered." Thus it is reasonable to assume that the staff would so describe the situation at TMI-2.

The stat. in SECY 96-256, found that the estimated on-site cleanup costs to recover from the rupture of a large liquid radwaste storage tank could range up to $50 million. The proposed level of $50 million for on-site property insurance is sufficient to cover these estimated cleanup costs.

A recent study submitted to the NRC by the Nuclear Energy Institute (NEI) indicates that this I level ofinsurance would be very conseivative.-

The on-site property damage insurance that GPUN will obtain for TMI-2 will provide coverage for property damage at TMI-2 irrespective of whether the loss is caused by TMI-2 or TMI-l activities.

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1920-99-20104 L Page 3 of 4 BASIS FOR EXEMPTION REOUEST

' The specific requirements for granting exemptions from Part 50 regulations are set forth in 10CFR50.12. The commission is authorized to grant an exemption upon a determination that the exemption: (A) is authorized by law; (B) will not present an undue risk to the public health and

- safety; and (C)is consistent with the common defense and security. Special circumstances must exist for the NRC to consider an exemption request. Special circumstances include: (1) particular circumstances where the application of the regulation would not serve the underlying purpose of l the rule or is not necessary to achieve the underlying purpose of the rule and (2) undue hardship o ccosts that are significantly in excess of those incurred by others similarly situated.

A. The requested exemption is authorized by law and has been routinely granted by the

. Commission. Those plants granted insurance exemptions include Rancho Seco, Haddam Neck, Maine Yankee, Trojan, among others. In addition, the requested exemptions are consistent with SECY 96-256 and the NRC proposed rule for 10CFR Parts 50 and 140, noticed in the Federal Register on October 30,1997.

B. The requested exemption produces no undue risk to the public health and safety. As stated above, the risks associated with TMI-2 in its current condition and the possible resulting l damage to property are greatly reduced from those of power operations. The reduction in coverage is commensurate with the reduction in the risk and consequences of an accident.

C. The requested exemption is consistent with the common defense and security. The exemption would reduce the required on-site property damage coverage. There would be no physical change to the plant or the fuc! debris as a rest.it of this exemption and no impact on the common defense or security of the public or the TMI-2 facility.

1. - The continued application of the requirements of 10CFR50.54(w) is not necessary to achieve the underlying purpose of the rule which is to provide assurance that the licensee will have the financial capability to restore the facility to a safe configuration after a design basis accident.

The $1.06 billion coverage specified in the rule was clearly applicable to the potential for damage at an operating plant. In the present PDMS condition, $50 million in property coverage is more than sufficient to provide safe restoration assurance. The NRC analysis l discussed in SECY 96-256 estimates the cleanup costs associated with the rupture of a large l tank of slightly contaminated water to be about $50 million. The requested exemption is consistent with these estimates and meets the purpose of the rule.

i l The requirements of 10CFR50.54(w) did not contemplate a shutdown reactor owned by one )

l licensee on the site of an operating reactor owned by another licensee. In this respect, the j provision in section 50.54(w) imposing the $1.06 billion property damage coverage on the j entire " reactor station site" was never mtended to require the licensee of the shutdown unit to also carry property damage insurance in the amount required for the operating unit.

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1920-99-20104 Page 4 of 4 Any property damage to TMI-2, due to a TMI-l accident, is expected to be within the $50 million limit requested. This expectation is consistent with and supported by the limited property damage that TMI-l experienced from the TMI-2 accident in 1979.

2. The requirement to maintain $1.06 billion in property coverage represents a financial burden to the licensee of TMI-2 and the electric customers ofits owners, which has no benefit to the licensee, the public, or the Faderal Government. As such, the financial burden of the specified insurance level represents a hardship not appropriate nor ever intended for a facility in the PDMS condition. '

CONCLUSION 1

The risks for which 10CFR50.54(w) requires a licensee to obtain specific financial protection l amounts for an operating plant are no longer applicable to TMI-2. The guidelines discussed in l SECY 96-256 provide for a reduced level ofinsurance coverage appropriate for a permanently defueled plant. Therefore, GPUN respectfully requests the NRC Staff to exempt TMI-2 from the financial protection requirements for an operating plant and approve reduced financial protection  ;

coverage for a permanently defueled plant of $50 million in on-site insurance coverage consistent with Reactor Configuration 3, as described in SECY 96-256.

If the NRC should have any questions, please contact Adam Miller of the TMI Nuclear Safety &

Licensing Department at (717) 948-8128.

Sincerely, yt mes W. Lang bach Vice President and Director, TM1 AWM cc: TMI Senior Resident Inspector Administrator, Region I TMI-2 Senior Project Manager File 99057

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