ML23271A134

Dtf Analysis Letter

ML23271A134
Person / Time
Site:	Peach Bottom
Issue date:	10/11/2023
From:	Tanya Hood Reactor Decommissioning Branch
To:	Rhoades D Constellation Energy Generation, Constellation Nuclear
References
Download: ML23271A134 (4)

Text

Mr. David P. Rhoades Senior Vice President Constellation Energy Generation, LLC President and Chief Nuclear Officer Constellation Nuclear 4300 Winfield Road Warrenville, IL 60555

SUBJECT:

PEACH BOTTOM ATOMIC POWER STATION, UNIT NO. 1 - U.S. NUCLEAR REGULATORY COMMISSIONS ANALYSIS OF CONSTELLATION ENERGY GENERATIONS DECOMMISSIONING FUNDING STATUS REPORT (DOCKET NO. 50-171)

Dear David Rhoades:

By letter dated March 23, 2023, the U.S. Nuclear Regulatory Commission (NRC) received the decommissioning funding status (DFS) report for the Peach Bottom Atomic Power Station, Unit 1 (Peach Bottom Unit 1) Agencywide Documents Access and Management System (ADAMS) (Accession No. ML23082A312), which was submitted by Constellation Energy Generation, LLC (CEG, the licensee).

The NRC has reviewed and analyzed the site-specific decommissioning cost estimates for the facility, as required by Section 50.82, Termination of license - For power reactor licensees, of Title 10 of the Code of Federal Regulations (10 CFR). The NRC staff also verified the amount stated within the licensees decommissioning trust funds for Peach Bottom Unit 1 as of December 31, 2022, as well as earnings assumptions. Based on the reported decommissioning trust fund (DTF) balances, the NRC has determined that as of December 31, 2022, the licensee is providing a total amount of radiological decommissioning funding assurance in the amount of

$145,438,000 in 2022 dollars for Peach Bottom Unit 1.

The NRC staff notes that Peach Bottom Unit 1 had a shortfall in decommissioning funding, which was self-identified by the licensee in the March 23, 2023, submittal and confirmed by the staff. In the cash flow analysis used to evaluate the decommissioning of this unit through license termination in 2034, the licensee experiences a shortfall of approximately $44,167,575 following radiological decommissioning expenditures of over $275 million.

However, the licensee identified a solution to the shortfall in the DFS submittal, which states:

Due to recent market performance, Peach Bottom, Unit 1, did not meet the minimum funding assurance criteria under 10 CFR 50.75 and 10 CFR 50.82 as of December 31, 2022, based solely on the trust fund balance. Financial assurance for decommissioning this reactor is provided by the external sinking fund method, coupled with an external trust fund, in accordance with 10 CFR 50.75(e)(1)(ii). The source of revenue for the October 11, 2023 D. Rhoades

external sinking fund is a "nonbypassable charge" approved by the Pennsylvania Public Utilities Commission (PaPUC) authorizing PECO Energy Company to continue to collect decommissioning funds for CEG. The amount to be collected will be adjusted, as necessary, in accordance with the applicable tariff in the next submission to the PaPUC of the Nuclear Decommissioning Cost Adjustment (NDCA) to cover any funding shortfall that exists at that time. This cost adjustment is made every five years pursuant to PaPUC Electric Tariff No. 4. The next rate adjustment will be effective January 1, 2028.

The PaPUC was notified that the amount collected may need to be adjusted in the next filing. CEG's ability to adjust the amount collected for Peach Bottom, Unit 1, is consistent with the guidance in Regulatory Guide 1.159, Assuring Availability of Funds for Decommissioning Nuclear Reactors, Revision 2, page 13, which provides that, Adjustments to the annual amount of funds being set aside may be made to coincide with rate cases considered by a licensee's public utility commission (PUC).

The NRC staff agrees that the licensees approach is an acceptable means to address the DTF shortfall for Peach Bottom Unit 1. Coupled with its current DTF balance of $145,438,000 (December 31, 2022), reliance on future contributions from the rate setting authority (PaPUC) as stated above to address the DTF shortfall meets the intent of decommissioning funding assurance for utility licensees. Accordingly, no further action is required at this time to address this shortfall.

This letter confirms the correspondence, described above, regarding DFS reports for permanently shut down power reactors as required under 10 CFR 50.82(a)(8)(v) - (vi). As of the date of this letter, considering the available information, the NRC has determined that the licensee has satisfied the decommissioning funding assurance requirements of 10 CFR 50.82 for Peach Bottom Unit 1 as of December 31, 2022.

In accordance with 10 CFR 2.390, Public inspections, exemptions, requests for withholding, of the NRCs Agency Rules of Practice and Procedure, a copy of this letter will be available electronically for public inspection in the NRC Public Document Room or from the Publicly Available Records component of NRCs ADAMS. ADAMS is accessible from the NRC website at https://www.nrc.gov/reading-rm/adams.html.

If you or your staff have any questions regarding the above, please contact me at 301-415-1387 or via email at Tanya.Hood@nrc.gov.

Sincerely, Tanya E. Hood, Project Manager Reactor Decommissioning Branch Division of Decommissioning, Uranium Recovery and Waste Programs Office of Nuclear Material Safety and Safeguards Docket No. 50-171 License No.DPR-12 cc: Distribution via Listserv Signed by Hood, Tanya on 10/11/23

Ltr ML23271A134 OFFICE NMSS/DUWP/RDB NMSS/REFS/FAB NMSS/DUWP/RDB NMSS/DUWP/RDB NAME THood TH FMiller FM SAnderson SA THood TH DATE Sep 29, 2023 Oct 4, 2023 Oct 10, 2023 Oct 11, 2023