ML23339A136
| ML23339A136 | |
| Person / Time | |
|---|---|
| Site: | Kewaunee  |
| Issue date: | 01/26/2024 |
| From: | Sturzebecher K Reactor Decommissioning Branch |
| To: | |
| Shared Package | |
| ML23339A117 | List: |
| References | |
| EPID L-2023-LLE-0008 | |
| Download: ML23339A136 (12) | |
Text
Enclosure 2 SAFETY EVALUATION BY THE OFFICE OF NUCLEAR MATERIAL SAFETY AND SAFEGUARDS RELATED TO KEWAUNEE SOLUTIONS, INC., AND ENERGYSOLUTIONS, LLC.,
REQUEST FOR EXEMPTION TO ALLOW USE OF FUNDS FROM THE NUCLEAR DECOMMISSIONING TRUST FOR SITE RESTORATION AND TO REMOVE A NOTIFICATION REQUIREMENT FOR THE DISBURSAL OF FUNDS FROM THE DECOMMISSIONING TRUST FOR SITE RESTORATION ACTIVITIES DOCKET NO. 50-305 This document contains proprietary information pursuant to Section 2.390, Public inspections, exemptions, requests for withholding, of Title 10 of the Code of Federal Regulations (10 CFR).
Proprietary information is identified by bold text enclosed within double brackets, as shown here: ((example proprietary text)).
1.0 INTRODUCTION
By letter dated March 29, 2023 (Agencywide Documents Access and Management System Accession No. ML23093A031), Kewaunee Solutions, Inc., and EnergySolutions, LLC (Kewaunee Solutions and EnergySolutions, respectively, or the licensees), submitted, pursuant to 10 CFR 50.12, Specific Exemptions, a request for an exemption from the specific requirements of Paragraph (a)(8)(i)(A) of Section 50.82 Termination of license, of Part 50, Domestic Licensing of Production and Utilization Facilities, to 10 CFR and Paragraph (h)(1)(iv) of 10 CFR 50.75, Reporting and recordkeeping for decommissioning planning, for the Kewaunee Power Station (KPS). This exemption would allow KPS to use funds from the nuclear decommissioning trust (NDT) for site restoration activities and allow trust disbursements for site restoration activities to be made without prior notice to the U.S. Nuclear Regulatory Commission (NRC), similar to withdrawals in accordance with 10 CFR 50.82(a)(8) for decommissioning activities. By letter dated October 5, 2023, (ML23278A100), the licensees provided a response to an NRC request for additional information (RAI), dated August 29, 2023 (ML23222A152), pertaining to the decommissioning trust fund (DTF) cash flows that were provided in the initial exemption request submittal.
The funds within the DTF were collected in compliance with the 10 CFR 50.75 financial requirements while KPS was operating. The licensees included with the exemption request a cash flow analysis reflecting the balance of funds within the trust throughout the decommissioning period, based upon a DECON decommissioning method ending in 2055, which is the year of anticipated license termination.
The requirements of 10 CFR 50.82(a)(8)(i)(A) restrict withdrawals from a DTF to expenses for legitimate decommissioning activities consistent with the definition of decommissioning in 10 CFR 50.2, Definitions. The definition of decommission in 10 CFR 50.2 does not include activities associated with irradiated fuel (spent fuel or spent nuclear fuel) management and site restoration. The NRC previously approved an exemption for KPS to funds from the KPS NDT for the management of spent fuel, and to allow disbursement of spent fuel management expenses from the DTF without prior notification of the NRC, on May 21, 2014 (ML13225A224).
2.0 BACKGROUND
KPS Permanent Cessation of Operations and Removal of Fuel from the Reactor Vessel By letter dated February 25, 2013 (ML13058A065), the previous holder of the KPS Renewed Facility Operating License (RFOL) No. DPR-43, Dominion Energy Kewaunee (DEK), submitted a certification to the NRC indicating it would permanently cease power operations at KPS on May 7, 2013. On May 7, 2013, power operation at KPS permanently ceased. On May 14, 2013 (ML13135A209), DEK certified that it had permanently defueled the KPS reactor vessel.
Exemption for Use of the KPS DTF for Spent Fuel Management and Notification Requirements On April 4, 2013 (ML13098A031), DEK submitted a request for an exemption from 10 CFR 50.82(a)(8)(i)(A) and 10 CFR 50.75(h)(1)(iv) seeking permission to withdraw and use a portion of the funds from the KPS DTF for irradiated fuel management, consistent with the KPS updated Irradiated Fuel Management Plan (Spent Fuel Management Plan (IFMP or SFMP)),
and the KPS Post-Shutdown Decommissioning Activities Report (PSDAR). The licensee also requested an exemption from 10 CFR 50.75(h)(1)(iv) that would permit withdrawals from the KPS DTF for irradiated fuel management activities without prior notification of the NRC, in the same manner as withdrawals are made under 10 CFR 50.82(a)(8) for decommissioning activities. By letters dated February 26, 2013, and April 25, 2014 (ML13059A028 and ML14119A120, respectively), DEK submitted updates to the KPS IFMP as required by Paragraph (bb) of 10 CFR 50.54, Conditions of licenses; and by separate letters dated February 26, 2013, and April 25, 2014 (ML13063A248 and ML14118A382, respectively), DEK submitted its PSDAR and a revision to the PSDAR, as required by 10 CFR 50.82(a)(4)(i).
On May 21, 2014, the NRC approved the exemption from the specific requirements of 10 CFR 50.82(a)(8)(i)(A) and 10 CFR 50.75(h)(1)(iv) for KPS, thereby authorizing the licensee to use funds from the KPS DTF for spent fuel management without prior notification to the NRC.
Transfer of Control of the Renewed Facility Operating License for KPS By letter dated May 10, 2021 (ML21131A141), as supplemented by letters dated May 13, 2021, October 28, 2021, February 16, 2022, and March 15, 2022 (ML21145A118, ML21301A177, ML22047A057, and ML22076A065, respectively), DEK and EnergySolutions (together, the applicants) requested that the NRC consent to the indirect transfer of control of RFOL No. DPR-43 for KPS and the general license for the KPS independent spent fuel storage installation (ISFSI). The applicants requested indirect transfer of control of the licenses from DEKs parent entity, Dominion Nuclear Projects, Inc. (Dominion), to EnergySolutions. In addition, pursuant to 10 CFR 50.90, Application for amendment of license, construction permit, or early site permit, the applicants requested that the NRC approve a conforming administrative amendment to RFOL No. DPR-43 to reflect, concurrent with the transfer, the proposed transfer and the planned name change from DEK to Kewaunee Solutions.
The applicants indicated that upon NRC approval of the license transfer application and the consummation of the proposed transfer transaction, the same legal entity would remain the KPS licensee, and its name would change from DEK to Kewaunee Solutions. Kewaunee Solutions would continue to hold title to and ownership of any real estate encompassing the KPS site, any improvements to the site, and title to and ownership of the spent fuel. Kewaunee Solutions would have responsibility for all licensed activities at the KPS site, including responsibility under the license to complete decommissioning pursuant to NRC regulations. However, Kewaunee Solutions would operate under new management and would be a direct and wholly owned subsidiary of EnergySolutions.
On March 31, 2022 (ML22014A387), the indirect transfer of control of RFOL No. DPR-43 for KPS, and for the general license for the KPS ISFSI, was approved by the NRC. In summary, subsequent to NRCs approval of the transfer, DEKs parent entity, Dominion, transferred its authority to EnergySolutions, and DEK changed its name to Kewaunee Solutions.
Exemption Request for Use of KPS DTF for Site Restoration and Reporting Requirements The request for an exemption from the requirements of 10 CFR 50.82(a)(8)(i)(A) and 10 CFR 50.75(h)(1)(iv) would allow the licensees to use funds from the KPS NDT for the management of site restoration activities and allow trust disbursements for site restoration activities to be made without prior notice to the NRC. The licensees initial basis for the exemption request relied upon financial and other decommissioning data reflected in a May 13, 2021, letter from EnergySolutions titled Notification of Amended Post Shutdown Decommissioning Activities Report (Revision 2) for Kewaunee Power Station (ML21145A083),
as well as on decommissioning cost estimate data provided with that letter. However, during the course of its review the NRC staff concluded that the status of funding in the KPS DTF had changed since submission of the May 13, 2021, letter. Specifically, the NRC staff noted that there were significant differences in the expenditure and cash flow data reported in the PSDAR and site-specific decommissioning cost estimate (SSDCE) that formed the basis of the exemption request, and a more recent DTF Status Report, dated March 30, 2023 (ML23089A304), for the KPS NDT, which reflects financial data through December 31, 2022.
Therefore, the NRC staff raised a concern that the PSDAR and SSDCE data on which the NRC was to base its analysis of the portion of the exemption request relating to the requirement in 10 CFR 50.82(a)(8)(i)(A), to allow use of funds from the KPS NDT for site restoration activities, was outdated, and thus did not provide the timely information necessary for the staff to complete its analysis. Subsequently, the NRC staff requested additional information from the licensees in an RAI letter dated August 29, 2023, requesting, in part, revised license termination, spent fuel management, and site restoration plans, including forecasted cash flow expenditure data, that reflect Kewaunee Solution's current assumptions about the decommissioning method, decommissioning activities, and the schedule of such activities for KPS, so that the staff could perform its analysis of the requested exemption with more timely data. The licensees responded by letter dated October 5, 2023, explaining that the basis for demonstrating adequate funding for the exemption request is provided in (1) the March 30, 2023, KPS DTF Status Report, which includes detailed license termination, spent fuel management, and site restoration costs; and (2) the total forecasted expenditure data provided in the RAI response, which is based on the DECON decommissioning method and the current schedule for decommissioning and license termination activities for KPS.
3.0 REGULATORY REQUIREMENTS The requirements of 10 CFR 50.82(a)(8)(i) restrict withdrawals from the DTF to expenses for legitimate decommissioning activities, consistent with the definition of decommission in 10 CFR 50.2.
10 CFR 50.82(a)(8)(i) states that licensees may use DTFs if:
(A) The withdrawals are for expenses for legitimate decommissioning activities consistent with the definition of decommissioning in [10 CFR] 50.2; (B) The expenditure would not reduce the value of the decommissioning trust below an amount necessary to place and maintain the reactor in a safe storage condition if unforeseen conditions or expenses arise and; (C) The withdrawals would not inhibit the ability of the licensee to complete funding of any shortfalls in the decommissioning trust needed to ensure the availability of funds to ultimately release the site and terminate the license.
In accordance with 10 CFR 50.2, the term decommission means:
to remove a facility or site safely from service and reduce residual radioactivity to a level that permits -
(1) Release of the property for unrestricted use and termination of the license; or (2) Release of the property under restricted conditions and termination of the license.
The definition does not include activities associated with spent fuel management or site restoration. The requirement at 10 CFR 50.75(h)(1)(iv) also restricts the use of DTF disbursements (other than for ordinary administrative costs and other incidental expenses of the fund in connection with the operation of the fund) to decommissioning expenses until final radiological decommissioning is completed. While the NRC previously approved an exemption for KPS to use funds from the KPS NDT for the management of spent fuel, an additional exemption from 10 CFR 50.82(a)(8)(i)(A) and 10 CFR 50.75(h)(1)(iv) is needed to allow the licensees to use funds from the KPS NDT for site restoration activities at KPS prior to completion of all decommissioning activities.
The requirement at 10 CFR 50.75(h)(1)(iv) further provides that, except for withdrawals being made under 10 CFR 50.82(a)(8) or for payments of ordinary administrative costs and other incidental expenses of the fund in connection with the operation of the fund, no disbursement may be made from the DTF without written notice to the NRC at least 30 working days in advance. Therefore, an exemption from 10 CFR 50.75(h)(1)(iv) is needed to allow the licensees to use funds from the KPS NDT for site restoration activities without prior NRC notification.
Pursuant to 10 CFR 50.12, the Commission may, upon application by any interested person or upon its own initiative, grant exemptions from the requirements of 10 CFR Part 50 (1) when the exemptions are authorized by law, will not present an undue risk to the public health and safety, and are consistent with the common defense and security; and (2) when any of the special circumstances listed in 10 CFR 50.12(a)(2) are present. These special circumstances include, among other things, the following:
(a) Application of the regulation in the particular circumstances would not serve the underlying purpose of the rule or is not necessary to achieve the underlying purpose of the rule; and (b) Compliance would result in undue hardship or other costs that are significantly in excess of those contemplated when the regulation was adopted, or that are significantly in excess of those incurred by others similarly situated.
In transitioning to and planning for decommissioning activities, several power reactor licensees have requested exemptions from the decommissioning funding assurance requirements in 10 CFR 50.75 and 10 CFR 50.82 to allow for the withdrawal of funds from their DTFs for expenses unrelated to decommissioning as defined in 10 CFR 50.2, such as for spent fuel management and site restoration. Generally, the NRC has granted these exemption requests,1 on a case-by-case basis, finding reasonable assurance that even after the proposed withdrawals of funds for the requested use (e.g., spent fuel management and site restoration),
sufficient funding remains in the DTF to complete radiological decommissioning of the facility and site and to terminate the license.
The Commission addressed a similar issue in Staff Requirements Memorandum (SRM)
SECY-02-0085, Recent Issues With Respect to Decommissioning Funding Assurance That Have Arisen as Part of License Transfer Applications and Other Licensing Requests, dated January 3, 2003 (ML013550423). In that SRM, the Commission stated that [t]he staff should continue to review requests for withdrawal or non-transfer of funds from decommissioning trusts on a case-by-case basis, and while a trust is accumulating, our regulations should be interpreted as strictly as possible to preclude withdrawals (both radiological and nonradiological). As such the NRC staff recognizes that, like the specific exemption requests cited above, the licensees current request has been submitted as part of the planning for, and implementation of, decommissioning activities, and not during the operational life of the facility and principal fund-accumulating phase of the license.
4.0 JUSTIFICATION FOR SPECIFIC EXEMPTION Upon review by the NRC staff, the licensees PSDAR, SSDCE, the most recent KPS DTF Status Report, and additional information provided by the licensees in response to the NRC staffs RAI on this exemption request, contained sufficient information to demonstrate 1
See various NRC exemption notifications and correspondence to licensees requesting such exemptions, including those previously affecting Kewaunee Power Station (ML13337A287), Zion Nuclear Power Station, Units 1 and 2 (ML14030A590), San Onofre Nuclear Generating Power Station, Units 2 and 3 (ML14101A132),
Vermont Yankee Nuclear Power Station (ML15128A219), Oyster Creek Nuclear Generating Station (ML18227A025), Pilgrim Nuclear Power Station (ML19192A097), Three Mile Island Nuclear Station, Unit 1 (ML19259A175), Duane Arnold Energy Center (ML20171A627), Indian Point Nuclear Generating Station, Units 1, 2, and 3 (ML20309A785), and Palisades Nuclear Plant (ML21286A506).
reasonable assurance that funds within the DTF are in excess of the amount needed to cover the estimated costs of radiological decommissioning, spent fuel management, and site restoration. The NRC staffs conclusion is reflected in the cash flow analysis provided as, Kewaunee Power Station Closing Balance Calculations in Support of Exemption Request for Use of DTF for Site Restoration Activities, of this safety evaluation. The KPS SFMP also reflected the licensees intention to use the DTF for spent fuel management and site restoration activities. Costs associated with radiological decommissioning (license termination),
spent fuel management, and site restoration, as well as the associated cash flow balances, are consistent across the most recent PSDAR, SSDCE, KPS DTF Status Report, and additional information provided by the licensees in the supplement to this exemption request.
The KPS DTF has been established for the purpose of complying with the financial assurance requirements of 10 CFR 50.75 while operating. Pursuant to the provisions of 10 CFR 50.75(c),
the NRCs minimum financial assurance requirements exclude the cost for removal and disposal of spent fuel. The management of spent fuel and planning for the funding of spent fuel management is separately addressed by 10 CFR 50.54(bb), and therefore, the NRC's financial assurance requirements in 10 CFR 50.75 are not directly designed to capture the costs of removing and disposing of spent nuclear fuel.
4.1 The Exemption is Authorized by Law According to the submittal, the requested exemption from the requirements of 10 CFR 50.82(a)(8)(i)(A) and 10 CFR 50.75(h)(1)(iv) would allow the licensees to use a portion of the funds from the KPS DTF for site restoration activities at KPS without prior notice to the NRC, in the same manner that withdrawals are made under 10 CFR 50.82(a)(8) for decommissioning activities and through use of a previously authorized exemption for KPS spent fuel management activities. As stated above, 10 CFR 50.12 allows the NRC to grant exemptions from the requirements of 10 CFR Part 50 when the exemptions are authorized by law. The NRC staff has determined, as explained below, that granting the licensees proposed exemption will not result in a violation of the Atomic Energy Act of 1954, as amended, or the Commissions regulations. Therefore, the exemption, as requested, is authorized by law.
4.2 The Exemption Will Not Present Undue Risk to Public Health and Safety The underlying purpose of 10 CFR 50.82(a)(8)(i)(A) and 10 CFR 50.75(h)(1)(iv) is to provide reasonable assurance that adequate funds will be available for the radiological decommissioning and license termination of power reactors. Based on the schedules, costs, and funding information contained in the licensees PSDAR, SSDCE, SFMP, the exemption request, the most recent KPS DTF Status Report, additional information provided by the licensees in response to the NRC staffs RAI on this exemption request, and conclusions reached by the NRC staff in its independent review of this information as presented in of this safety evaluation, the use of a portion of the KPS DTF for site restoration activities will not adversely impact the licensees ability to complete decommissioning in a 60-year period and terminate the KPS license as planned.
Additionally, an exemption from 10 CFR 50.75(h)(1)(iv) authorizing withdrawals from the KPS DTF for site restoration expenses without prior written notification to the NRC will not affect the sufficiency of funds in the DTF to complete decommissioning and terminate the license because such withdrawals remain constrained by the provisions of 10 CFR 50.82(a)(8)(i)(B)-(C) and are reviewable under the annual reporting requirements of 10 CFR 50.82(a)(8)(v)-(vii). Therefore, KPS decommissioning trust funds, in accordance with 10 CFR 50.82(a)(8)(i)(B)-(C), may only be used by the licensee if: (1) an expenditure would not reduce the value of the decommissioning trust below an amount necessary to place and maintain the reactor in a safe storage condition if unforeseen conditions or expenses arise and; (2) the withdrawals would not inhibit the ability of the licensees to complete funding of any shortfalls in the DTF needed to ensure the availability of funds to ultimately release the site and terminate the license.
According to the submittal, the requested exemption does not involve any significant changes to the types or amounts of effluents that may be released offsite as a result of site activities associated with radiological decommissioning, spent fuel management, and site restoration, only the potential funding sources for those activities. Similarly, there is no significant increase in occupational or public radiation exposure. This exemption does not diminish the effectiveness of other regulations that ensure available funding for decommissioning, including 10 CFR 50.82(a)(6), which prohibits licensees from performing any decommissioning activities that could foreclose unrestricted release of the site, result in significant environmental impacts not previously reviewed, or result in there no longer being reasonable assurance that adequate funds will be available for decommissioning. Therefore, the exemption, as requested, will not present an undue risk to the public health and safety.
4.3 The Exemption is Consistent with the Common Defense and Security According to the submittal, the requested exemption would allow the licensees to use funds from the KPS NDT for the management of site restoration activities and allow trust disbursements for site restoration activities to be made without prior notice to the NRC. Spent fuel management under 10 CFR 50.54(bb) is an integral part of the planned KPS decommissioning and license termination process; the NRC previously approved an exemption for KPS to use funds from the KPS NDT for the management of spent fuel. The current change, to enable the use of a portion of the funds from the DTF for site restoration activities, and to do so without prior written NRC notification, has no relation to security issues. Therefore, the common defense and security is not impacted by the exemption, as requested.
4.4 Special Circumstances Special circumstances, in accordance with 10 CFR 50.12(a)(2)(ii), are present whenever application of the regulation in the particular circumstances is not necessary to achieve the underlying purpose of the regulation. According to the exemption request, the licensees believe that special circumstances are present as discussed below.
4.4.1 Application of the regulation in the particular circumstances would not serve the underlying purpose of the rule or is not necessary to achieve the underlying purpose of the rule.
As previously stated, the underlying purpose of 10 CFR 50.82(a)(8)(i)(A) and 10 CFR 50.75(h)(1)(iv), which restrict withdrawals from the DTF to expenses for radiological decommissioning activities, is to provide reasonable assurance that adequate funds will be available to complete radiological decommissioning of a reactor site and achieve license termination. Strict application of these requirements would prohibit the withdrawal of funds from the KPS DTF for activities other than radiological decommissioning activities at KPS, such as for spent fuel management and site restoration activities, until final radiological decommissioning of the site has been completed and the license terminated. As noted above, the NRC previously approved an exemption for the licensees to use funds from the KPS NDT for the management of spent fuel on May 21, 2014.
The NRC staffs review and independent analysis of the licensees exemption request, which included consideration of information in the PSDAR, SSDCE, the most recent KPS DTF Status Report, and additional information provided by the licensees in response to the NRC staffs RAI on this exemption request, found that reasonable assurance exists that adequate funds will be available in the KPS DTF to complete radiological decommissioning of the KPS facility and site and terminate the 10 CFR Part 50 license, with funding available beyond that required under 10 CFR 50.75 to pay for spent fuel management and site restoration activities that are within the scope of this exemption request for use of the KPS DTF for site restoration activities.
As presented in the most recent KPS DTF Status Report and reflected in Attachment 1 of this safety evaluation, the beginning DTF balance was $745.6 million as of December 31, 2022. The licensees project costs for license termination, spent fuel management,and site restoration activities of $654 million, $36.1 million, and $38.1 million, respectively, in 2023 dollars. This reflects a total remaining estimated cost of approximately $728.2 million for radiological decommissioning, spent fuel management, and site restoration activities, with license termination anticipated in 2055. The NRC staffs independent cash flow analysis projects that the KPS DTF will contain approximately $84.3 million following completion of radiological decommissioning activities at the site (year 2031), and $122.9 million at the end of all license termination, spent fuel management, and site restoration activities (year 2055), when considering use of the KPS DTF for payment of spent fuel management and site restoration expenses. In its analysis, the NRC staff assumed a 2 percent annual real rate of return on the DTF balance as allowed by 10 CFR 50.75(e)(1)(ii), less annual costs, which resulted in a positive estimated KPS DTF balance at the time of license termination. The NRC staffs analysis aligns with the cash flow analysis provided by the licensees in their submittals. Tax liabilities related to DTF investments are not reflected in the NRC staffs analysis.
The NRC staff confirmed that the current funds and projected earnings of the KPS DTF provide reasonable assurance of adequate funding to complete all NRC-required radiological decommissioning activities at KPS, as well as to pay for spent fuel management and site restoration activities. Therefore, the NRC staff finds that the licensees have provided reasonable assurance that adequate funds will be available for the radiological decommissioning of KPS, even with the disbursement of funds from the DTF for spent fuel management and site restoration activities. Consequently, the NRC staff concludes that application of the requirements of 10 CFR 50.82(a)(8)(i)(A) and 10 CFR 50.75(h)(1)(iv), in addition to application of a previously authorized exemption for spent fuel management activities at KPS, which provide that funds from the DTF only be used for radiological decommissioning activities and not for site restoration activities, is not necessary to achieve the underlying purpose of the rule.
Thus, special circumstances are present supporting approval of the exemption request.
In its submittal, the licensees also requested exemption from the requirement of 10 CFR 50.75(h)(1)(iv) concerning prior written notification to the NRC of withdrawals from the DTF to fund activities other than radiological decommissioning. The underlying purpose of notifying the NRC prior to withdrawal of funds from the DTF is to provide the opportunity for NRC intervention, when deemed necessary, if the withdrawals are for expenses other than those authorized by 10 CFR 50.75(h)(1)(iv), 10 CFR 50.82(a)(8), and by the previously approved exemption for spent fuel management expenditures from the DTF, which could result in there being insufficient funds in the DTF to accomplish radiological decommissioning.
By granting the exemption to 10 CFR 50.75(h)(1)(iv) and 10 CFR 50.82(a)(8)(i)(A), the NRC staff considers that withdrawals consistent with the licensees submittal dated March 29, 2023, are authorized. As stated previously, the NRC staff determined that there are sufficient funds in the KPS DTF to complete radiological decommissioning activities, as well as to conduct spent fuel management and site restoration activities, consistent with the licensees PSDAR and SSDCE, dated May 13, 2021, as well as the information provided in support of its exemption request, as supplemented.
Pursuant to the requirements in 10 CFR 50.82(a)(8)(v) and (vii), licensees are required to monitor and annually report to the NRC the status of the DTF and the licensees funding for spent fuel management. These reports provide the NRC staff with awareness of, and the ability to take action on, any actual or potential funding deficiencies. Additionally, 10 CFR 50.82(a)(8)(vi) requires that the annual DTF status report must include additional financial assurance to cover the estimated cost of completion of radiological decommissioning if the sum of the balance of any remaining decommissioning funds, plus earnings on such funds calculated at not greater than a 2-percent real rate of return, together with the amount provided by other financial assurance methods being relied upon, does not cover the estimated cost to complete decommissioning.
The requested exemption would not allow the withdrawal of funds from the KPS DTF for any purpose that is not currently authorized in the regulations, or that has previously been authorized by exemption from the NRC, without prior notification to the NRC. Therefore, the granting of the exemption to 10 CFR 50.75(h)(1)(iv) to allow the licensees to make withdrawals from the KPS DTF to cover authorized expenses for site restoration activities without prior written notification to the NRC will still meet the underlying purpose of the regulation.
4.4.2 Compliance would result in undue hardship or other costs that are significantly in excess of those contemplated when the regulation was adopted, or that are significantly in excess of those incurred by others similarly situated.
The requirements of 10 CFR 50.82(a)(8)(i)(A) restrict withdrawals from DTFs to expenses for legitimate decommissioning activities, consistent with the definition of decommission in 10 CFR 50.2. The licensees state, and the NRC staff has confirmed, that the KPS DTF contains funds in excess of the estimated costs of radiological decommissioning. The licensees further state that these excess funds are needed for spent fuel management and site restoration activities. The NRC does not preclude the use of funds from the DTF in excess of those needed for radiological decommissioning for other purposes, such as spent fuel management or site restoration activities. The adequacy of the KPS DTF to cover the cost of all activities associated with decommissioning, spent fuel management, and site restoration, as presented by the licensees and within the scope of this request, is supported by the cash flow analysis provided in Attachment 1 of this safety evaluation.
The NRC has previously stated that funding for spent fuel management and site restoration activities may be commingled in the DTF, provided that the licensee is able to identify and account for the radiological decommissioning funds separately from the funds set aside for spent fuel management and site restoration activities (see NRC Regulatory Issue Summary 2001-07, 10 CFR 50.75 Reporting and Recordkeeping for Decommissioning Planning, Revision 1, dated January 8, 2009 (ML083440158), and Regulatory Guide 1.184, Decommissioning of Nuclear Power Reactors, Revision 1, dated October 2013 (ML13144A840)). Preventing access to those excess funds in DTFs because spent fuel management and site restoration activities are not associated with radiological decommissioning would create an unnecessary financial burden without any corresponding safety benefit. The adequacy of the KPS DTF to cover the cost of activities associated with site restoration, in addition to radiological decommissioning and spent fuel management, is supported by the licensees SSDCE for KPS, and is further supported by the NRC staffs review as described herein and reflected in Attachment 1 of this safety evaluation. If the KPS DTF cannot be used for site restoration activities, the licensees would need to obtain additional funding that would not be recoverable from the DTF or would have to modify the decommissioning approach and methods planned at KPS. The NRC staff concludes that either outcome would impose an unnecessary and undue burden significantly in excess of that contemplated when 10 CFR 50.82(a)(8)(i)(A) and 10 CFR 50.75(h)(1)(iv) were adopted.
Since the underlying purpose of 10 CFR 50.82(a)(8)(i)(A) and 10 CFR 50.75(h)(1)(iv) would continue to be achieved by allowing the licensees to use a portion of the KPS DTF for site restoration activities without prior NRC notification, and compliance with the regulations would result in an undue hardship or other costs that are significantly in excess of those contemplated when the regulation was adopted, or that are significantly in excess of those incurred by others similarly situated, the special circumstances required by 10 CFR 50.12(a)(2) exist and support the approval of the requested exemption.
5.0 ENVIRONMENTAL CONSIDERATION
S In accordance with paragraph (a) of 10 CFR 51.31, Determinations based on environmental assessment, the Commission has determined that the granting of this exemption will not have a significant effect on the quality of the human environment, as discussed in the NRC staff's Environmental Assessment and Finding of No Significant Impact published on January 25, 2024 (89 FR 4999).
6.0 CONCLUSION
In consideration of the above, the NRC staff finds that the proposed exemption from 10 CFR 50.82(a)(8)(i)(A) confirms the adequacy of funding in the KPS DTF, considering growth, to complete radiological decommissioning of the site and to terminate the license. The NRC staff also finds that that funds within the KPS DTF are sufficient to cover the estimated spent fuel management costs, in accordance with the information provided for the KPS license, including the SFMP required by 10 CFR 50.54(bb), and site restoration costs, in accordance with the PSDAR, SSDCE, and information presented in earlier cited correspondence.
Accordingly, the NRC staff finds that there is reasonable assurance that adequate funds are available in the KPS DTF to complete all activities associated with radiological decommissioning, license termination, spent fuel management, and site restoration.
There is no decrease in safety associated with the KPS DTF being used to fund activities associated with site restoration. The exemption therefore confirms the licensees authorization to use funds from the KPS DTF for site restoration activities as described in the updated KPS PSDAR, and to make disbursements from the trust to fund site restoration costs without prior notification to the NRC. Site restoration expenses will be incurred simultaneously with license termination expenses before the NRC license is terminated. Additionally, the NRC staff concludes that an exemption from the requirement of 10 CFR 50.75(h)(1)(iv), to allow site restoration expense withdrawals from the DTF without prior NRC notification, will not hinder reasonable assurance of decommissioning funding at KPS.
Accordingly, pursuant to 10 CFR 50.12, the NRC staff finds that approval of the exemption is authorized by law, will not present undue risk to public health and safety, and is consistent with the common defense and security. Further, special circumstances do exist.
Principal Contributor: Richard Turtil NMSS/REFS/FAB Date of Issuance: January 26, 2024
ATTACHMENT 1: Kewaunee Power Station Closing Balance Calculations in Support of Kewaunee Power Station Exemption Request for Use of DTF for Site Restoration Activities (thousands of constant 2023 Dollars)
(reflects information from October 5, 2023, Kewaunee Solutions/EnergySolutions submission)
Year Opening DTF Balance License Termination Costs Spent Fuel Management Costs b Site Restoration Costs 2% Interest (real rate of return)
Closing Balance c
2023
((
2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050 2051 2052 2053 2054 2055
))
Total
$654,000
$36,100
$38,100 a -
Beginning balance on December 31, 2022.
b -
Data in this column include U.S. Department of Energy reimbursements which result in negative cost cash flow in years 2026, 2031, 2054, and 2055.
c -
Investment-related tax liabilities are not reflected in this table.