NOC-AE-06001990, Decommissioning Funding Status Report - 2005

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Decommissioning Funding Status Report - 2005
ML060800098
Person / Time
Site: South Texas  STP Nuclear Operating Company icon.png
Issue date: 03/09/2006
From: Mallen F
South Texas
To:
Document Control Desk, Office of Nuclear Reactor Regulation
References
G25, NOC-AE-06001990
Download: ML060800098 (15)
v • d • e


Text

Nuclear Operating Company South TwsPrord Ekdrk cxtW 282pMinwdsrth, 7aw 77483 Staffon PO Aom March 9, 2006 NOC-AE-06001990 File No.: G25 10 CFR 50.75 U. S. Nuclear Regulatory Commission Attention: Document Control Desk One White Flint North 11555 Rockville Pike Rockville, MD 20852-2738 South Texas Project Units 1 and 2 Docket Nos. STN 50-498, STN 50-499 Decommissioning Funding Status Report - 2005 Pursuant to 10 CFR 50.75(f), the STP Nuclear Operating Company submits the attached reports on the status of funds available for decommissioning Units 1 and 2. The reports were prepared for the following co-owners of the South Texas Project:

  • City Public Service of San Antonio; and
  • City of Austin - Austin Energy.

This list reflects the changes in ownership of the South Texas Project that have occurred during 2005. Shares previously owned by AEP Texas Central Company have been distributed between Texas Genco and City Public Service. Consequently, this report satisfies the annual reporting requirements of 10 CFR 50.75(f)(1) for changes in ownership. Data for the City of Austin are included for completeness.

There are no commitments in this letter.

If there are any questions, please contact either Philip L. Walker at (361) 972-8392 or me at (361) 972-8085.

Frank H. Mallen General Manager, Financial Support Attachments:

1. 2005 Decommissioning Funding Status Report - Texas Genco, LP
2. 2005 Decommissioning Funding Status Report - City Public Service of San Antonio
3. 2005 Decommissioning Funding Status Report - City of Austin - Austin Energy STI #31993637 AiKo

NOC-AE-06001990 Page 2 of 2 cc:

(paper copy) (electronic copy)

Bruce S. Mallett A. H. Gutterman, Esquire Regional Administrator, Region IV Morgan, Lewis & Bockius LLP U.S. Nuclear Regulatory Commission 611 Ryan Plaza Drive, Suite 400 Mohan C. Thadani Arlington, Texas 76011-8064 U. S. Nuclear Regulatory Commission Richard A. Ratliff Steve Winn Bureau of Radiation Control Michael A. Reed Texas Department of Health Texas Genco, LP 1100 West 49th Street Austin, TX 78756-3189 C. Kirksey City of Austin John Dixon J. J. Nesrsta U. S. Nuclear Regulatory Commission R. K. Temple P. 0. Box 289, Mail Code: MN1 16 E. Alarcon Wadsworth, TX 77483 City of San Antonio C. M. Canady Jon C. Wood City of Austin Cox Smith Matthews Electric Utility Department 721 Barton Springs Road Austin, TX 78704

ATTACHMENT 1 SOUTH TEXAS PROJECT 2005 DECOMMISSIONING FUNDING STATUS REPORT TEXAS GENCO, LP

Attachment 1 NOC-AE-06001990 Page 2 of 4 SOUTH TEXAS PROJECT 2005 DECOMMISSIONING FUNDING STATUS REPORT TEXAS GENCO, LP 30.8% Ownership of South Texas Project Unit 1 As provided in 10 CFR 50.75(f)(1), each power reactor licensee is required to report to the NRC on a calendar year basis, beginning March 31, 1999, and every two years thereafter on the status of its decommissioning funding for each reactor or share of reactor it owns. A licensee for a plant involved in a merger or acquisition shall submit the report annually. Funding information for the South Texas Project is provided below.

1. The minimum decommissioning fund estimate, pursuant to 10 CFR 50.75(b) and (c)':

Total Required: $105,456,342 Required by 12/31/2005: $ 42,752,571

2. The amount accumulated by the end of the calendar year preceding the date of the report for items included in 10 CFR 50.75(b) and (c): $ 99,918,871
3. A schedule of the annual amounts remaining to be collected for items in 10 CFR 50.75(b) and (c):

Amount remaining2: $43,501,532 Number of years to collect: 21.60

4. The assumptions used regarding escalation in decommissioning cost, rates of earnings on decommissioning funds, and rates of other factors used in funding projections:

Escalation factor: 4.77%

Assumed earnings rate: 4.47% to 6.82%

5. Any contracts upon which the licensee is relying pursuant to 10 CFR 50.75(e)(1)(v): None
6. Any modifications to a licensee's current method of providing financial assurance occurring since the last submitted report: None
7. Any material changes to the decommissioning trust agreements: None
1. NRC formulas in section 10 CFR 50.75(c) include only those decommissioning costs incurred by licensees to remove a facility or site safely from service, and reduce residual radioactivity to levels that permit: (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 cost of dismantling or demolishing non-radiological systems and structures is not included in the NRC decommissioning cost estimates. The costs of managing and storing spent fuel on site until transfer to DOE are not included in the cost formulas.
2. Target amounts to be collected were established by the Public Utility Commission of Texas (PUCT)-

approved separate non-bypassable decommissioning charges established in PUCT Tariff Control No.

31089. Actual collections will vary but the separate non-bypassable decommissioning charges are intended to produce the targeted annual collection amounts established in PUCT Docket No. 22355.

Attachment 1 NOC-AE-06001990 Page 2 of 4 SOUTH TEXAS PROJECT 2005 DECOMMISSIONING FUNDING STATUS REPORT TEXAS GENCO, LP 13.2% Ownership of South Texas Project Unit 1 (Acquired from AEP Texas Central Company)

As provided in 10 CFR 50.75(f)(1), each power reactor licensee is required to report to the NRC on a calendar year basis, beginning March 31, 1999, and every two years thereafter on the status of its decommissioning funding for each reactor or share of reactor it owns. A licensee for a plant involved in a merger or acquisition shall submit the report annually. Funding information for the South Texas Project is provided below.

1. The minimum decommissioning fund estimate, pursuant to 10 CFR 50.75(b) and (c)':

Total Required: $45,195,575 Required by 12131/2005: $ 18,322,530

2. The amount accumulated at the end of the calendar year preceding the date of the report for items included in 10 CFR 50.75(b) and (c): $ 36,535,291
3. A schedule of the annual amounts remaining to be collected for items in 10 CFR 50.75(b) and (c):

Amount remaining 2 : $42,294,656 Number of years to collect: 21.60

4. The assumptions used regarding escalation in decommissioning cost, rates of earnings on decommissioning funds, and rates of other factors used in funding projections:

Escalation factor: 4.77%

Assumed earnings rate: 3.28% to 6.58%

5. Any contracts upon which the licensee is relying pursuant to 10 CFR 50.75(e)(1)(v): None
6. Any modifications to a licensee's current method of providing financial assurance occurring since the last submitted report: None
7. Any material changes to the decommissioning trust agreements: None In connection with the acquisition of the 13.2% share of AEP Texas Central Company by Texas Genco LLC, new trust agreements were established between Mellon Bank, N. A. and Texas Genco, LP.

Assets representing a proportionate share of the interest in the plant purchased by Texas Genco were transferred to the new trusts.

1. NRC formulas in section 10 CFR 50.75(c) include only those decommissioning costs incurred by licensees to remove a facility or site safely from service, and reduce residual radioactivity to levels that permit: (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 cost of dismantling or demolishing non-radiological systems and structures is not included in the NRC decommissioning cost estimates. The costs of managing and storing spent fuel on site until transfer to DOE are not included in the cost formulas.
2. Target amounts to be collected were established by the Public Utility Commission of Texas (PUCT)-

approved separate non-bypassable decommissioning charges established in PUCT Tariff Control No.

31271. Actual collections will vary but the separate non-bypassable decommissioning charges are intended to produce the targeted annual collection amounts established in PUCT Docket No. 28840.

Attachment 1 NOC-AE-06001990 Page 3 of 4 SOUTH TEXAS PROJECT 2005 NRC DECOMMISSIONING FUNDING STATUS REPORT TEXAS GENCO, LP 30.8% Ownership of South Texas Project Unit 2 As provided in 10 CFR 50.75(f)(1), each power reactor licensee is required to report to the NRC on a calendar year basis, beginning March 31, 1999, and every two years thereafter on the status of its decommissioning funding for each reactor or share of reactor it owns. A licensee for a plant involved in a merger or acquisition shall submit the report annually. Funding information for the South Texas Project is provided below.

1. The minimum decommissioning fund estimate, pursuant to 10 CFR 50.75(b) and (c)':

Total Required: $105,456,342 Required by 12/31/2003: $41,627,503

2. The amount accumulated by the end of the calendar year preceding the date of the report for items included in 10 CFR 50.75(b) and (c): $130,408,224
3. A schedule of the annual amounts remaining to be collected for items in 10 CFR 50.75(b) and (c):

Amount remaining 2 : $20,456,631 Number of years to collect: 22.93

4. The assumptions used regarding escalation in decommissioning cost, rates of earnings on decommissioning funds, and rates of other factors used in funding projections:

Escalation factor: 4.77%

Assumed earnings rate: 4.47% to 6.82%

5. Any contracts upon which the licensee is relying pursuant to 10 CFR 50.75(e)(1)(v): None
6. Any modifications to a licensee's current method of providing financial assurance occurring since the last submitted report: None
7. Any material changes to trust agreements: None
1. The NRC formulas in section 10 CFR 50.75(c) include only those decommissioning costs incurred by licensees to remove a facility or site safely from service, and reduce residual radioactivity to levels that permit: (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 cost of dismantling or demolishing non-radiological systems and structures is not included in the NRC decommissioning cost estimates. The costs of managing and storing spent fuel on site until transfer to DOE are not included in the cost formulas.
2. Target amounts to be collected were established by the Public Utility Commission of Texas (PUCT)-

approved separate non-bypassable decommissioning charges established in PUCT Tariff Control No.

31089. Actual collection will vary but the separate non-bypassable decommissioning charges are intended to produce the targeted annual collection amounts established in PUCT Docket No. 22355.

Attachment 1 NOC-AE-06001990 Page 4 of 4 SOUTH TEXAS PROJECT 2005 DECOMMISSIONING FUNDING STATUS REPORT TEXAS GENCO, LP 13.2% Ownership of South Texas Project Unit 2 (Acquired from AEP Texas Central Company)

As provided in 10 CFR 50.75(f)(1), each power reactor licensee is required to report to the NRC on a calendar year basis, beginning March 31, 1999, and every two years thereafter on the status of its decommissioning funding for each reactor or share of reactor it owns. A licensee for a plant involved in a merger or acquisition shall submit the report annually. Funding information for the South Texas Project is provided below.

1. The minimum decommissioning fund estimate, pursuant to 10 CFR 50.75(b) and (c)':

Total Required: $45,195,575 Required by 12/31/2005: $ 17,840,359

2. The amount accumulated by the end of the calendar year preceding the date of the report for items included in 10 CFR 50.75(b) and (c): $ 45,032,175
3. A schedule of the annual amounts remaining to be collected for items in 10 CFR 50.75(b) and (c):

Amount remaining 2 : $46,288,250 Number of years to collect: 22.93

4. The assumptions used regarding escalation in decommissioning cost, rates of earnings on decommissioning funds, and rates of other factors used in funding projections:

Escalation factor: 4.77%

Assumed earnings rate: 3.28% to 6.58%

5. Any contracts upon which the licensee is relying pursuant to 10 CFR 50.75(e)(1)(v): None
6. Any modifications to a licensee's current method of providing financial assurance occurring since the last submitted report: None
7. Any material changes to the decommissioning trust agreements:

In connection with the acquisition of the 13.2% share of AEP Texas Central Company by Texas Genco LLC, new trust agreements were established between Mellon Bank, N. A. and Texas Genco, LP. Assets representing a proportionate share of the interest in the plant purchased by Texas Genco were transferred to the new trusts.

1. The NRC formulas in section 10 CFR 50.75(c) include only those decommissioning costs incurred by licensees to remove a facility or site safely from service, and reduce residual radioactivity to levels that permit: (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 cost of dismantling or demolishing non-radiological systems and structures is not included in the NRC decommissioning cost estimates. The costs of managing and storing spent fuel on site until transfer to DOE are not included in the cost formulas.
2. Target amounts to be collected were established by the Public Utility Commission of Texas (PUCT)-

approved separate non-bypassable decommissioning charges established in PUCT Tariff Control No.

31271. Actual collections will vary but the separate non-bypassable decommissioning charges are intended to produce the targeted annual collection amounts established in PUCT Docket No. 28840.

ATTACHMENT 2 SOUTH TEXAS PROJECT 2005 DECOMMISSIONING FUNDING STATUS REPORT CITY PUBLIC SERVICE OF SAN ANTONIO

Attachment 2 NOC-AE-06001990 Page 1 of 4 SOUTH TEXAS PROJECT 2005 NRC DECOMMISSIONING FUNDING STATUS REPORT CITY PUBLIC SERVICE OF SAN ANTONIO 28% Ownership of South Texas Project Unit 1 As provided in 10 CFR 50.75(f)(1), each power reactor licensee is required to report to the NRC on a calendar year basis, beginning March 31, 1999, and every two years thereafter on the status of its decommissioning funding for each reactor or share of reactor it owns. A licensee for a plant involved in a merger or acquisition shall submit the report annually. Funding information for the South Texas Project is provided below.

1. The minimum decommissioning fund estimate, pursuant to 10 CFR 50.75 (b) and (c)':

Total Required: $ 95,869,402 Required by 12/31/05: $ 38,865,974

2. The amount accumulated at the end of the calendar year preceding the date of the report for items included in 10 CFR 50.75 (b) and (c): $ 104,216,930
3. A schedule of the annual amounts remaining to be collected for items in 10 CFR 50.75 (b) and (c):

Amount Remaining: $ 54,340,000 Number of years to collect: 22

4. The assumptions used regarding escalation in decommissioning cost, rates of earnings on decommissioning funds, and rates of other factors used in funding projections:

Escalation factor: 4.72%

Assumed earnings rate2 : 4.45% to 6.16%

5. Any contracts upon which the licensee is relying pursuant to 10 CFR 50.75 (e)(1)(ii)(c): NONE
6. Any modifications to a licensee's current method providing financial assurance occurring since the last submitted report: NONE
7. Any material changes to trust agreements: NONE
1. The NRC formulas in section 10 CFR 50.75(c) include only those decommissioning costs incurred by licensees to remove a facility or site safely from service, and reduce residual radioactivity to levels that permit: (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 cost of dismantling or demolishing non-radiological systems and structures is not included in the NRC decommissioning cost estimates. The costs of managing and storing spent fuel on site until transfer to DOE are not included in the cost formulas.
2. For the 28% trust, the earnings rate is the standard treasury rates for a one-year to 30-year Treasury note. Through 2005, this segment of the trust was only allowed to invest in government bonds. The 12% trust acquired from AEP Texas Central has been allowed to invest in equities as well as government and corporate bonds. An 8% return is assumed for these investments similar to the historical returns of the pension plan assets. In the future, the rates for the 28% piece will be similar to the 12% piece since both can now invest similarly.

Attachment 2 NOC-AE-06001990 Page 2 of 4 SOUTH TEXAS PROJECT 2005 NRC DECOMMISSIONING FUNDING STATUS REPORT CITY PUBLIC SERVICE OF SAN ANTONIO 12% Ownership of South Texas Project Unit 1 (Acquired from AEP Texas Central Company)

As provided in 10 CFR 50.75(f)(1), each power reactor licensee is required to report to the NRC on a calendar year basis, beginning March 31, 1999, and every two years thereafter on the status of its decommissioning funding for each reactor or share of reactor it owns. A licensee for a plant involved in a merger or acquisition shall submit the report annually. Funding information for the South Texas Project is provided below.

1. The minimum decommissioning fund estimate, pursuant to 10 CFR 50.75 (b) and (c)':

Total required: $ 41,086,886 Required by 12131/05: $ 16,656,846

2. The amount accumulated by the end of the calendar year preceding the date of the report for items included in 10 CFR 50.75 (b) and (c): $29,429,525
3. A schedule of the annual amounts remaining to be collected for items in 10 CFR 50.75 (b) and (c):

Amount remaining: $ 70,064,526 Number of years to collect: 22

4. The assumptions used regarding escalation in decommissioning cost, rates of earnings on decommissioning funds, and rates of other factors used in funding projections:

Escalation factor: 4.72%

Assumed earnings rate2 : 8%

5. Any contracts upon which the licensee is relying pursuant to 10 CFR 50.75 (e)(1)(ii)(c): NONE
6. Any modifications to a licensee's current method providing financial assurance occurring since the last submitted report: NONE
7. Any material changes to trust agreements: This share of STP ownership acquired In May 2005.
1. The NRC formulas in section 10 CFR 50.75(c) include only those decommissioning costs incurred by licensees to remove a facility or site safely from service, and reduce residual radioactivity to levels that permit: (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 cost of dismantling or demolishing non-radiological systems and structures is not included in the NRC decommissioning cost estimates. The costs of managing and storing spent fuel on site until transfer to DOE are not included in the cost formulas.
2. For the 28% trust, the earnings rate is the standard treasury rates for a one-year to 30-year Treasury note. Through 2005, this segment of the trust was only allowed to invest in government bonds. The 12% trust acquired from AEP Texas Central has been allowed to invest in equities as well as government and corporate bonds. An 8% return is assumed for these investments similar to the historical returns of the pension plan assets. In the future, the rates for the 28% piece will be similar to the 12% piece since both can now invest similarly.

Attachment 2 NOC-AE-06001990 Page 3 of 4 SOUTH TEXAS PROJECT 2005 NRC DECOMMISSIONING FUNDING STATUS REPORT CITY PUBLIC SERVICE OF SAN ANTONIO 28% Ownership of South Texas Project Unit 2 As provided in 10 CFR 50.75(f)(1), each power reactor licensee is required to report to the NRC on a calendar year basis, beginning March 31, 1999, and every two years thereafter on the status of its decommissioning funding for each reactor or share of reactor it owns. A licensee for a plant involved in a merger or acquisition shall submit the report annually. Funding information for the South Texas Project is provided below.

1. The minimum decommissioning fund estimate, pursuant to 10 CFR 50.75 (b) and (c)':

Total required: $95,869,402 Required by 12/31/05: $37,843,185

2. The amount accumulated by the end of the calendar year preceding the date of the report for items included in 10 CFR 50.75 (b) and (c): $127,376,248
3. A schedule of the annual amounts remaining to be collected for items in 10 CFR 50.75 (b) and (c):

Amount remaining: $57,385,000 Number of years to collect: 23

4. The assumptions used regarding escalation in decommissioning cost, rates of earnings on decommissioning funds, and rates of other factors used in funding projections:

Escalation rate: 4.72%

Assumed earnings rate 2: 4.45% to 6.16%

5. Any contracts upon which the licensee is relying pursuant to 10 CFR 50.75 (e)(1)(ii)(c): NONE
6. Any modifications to a licensee's current method providing financial assurance occurring since the last submitted report: NONE
7. Any material changes to trust agreements: NONE
1. The NRC formulas in section 10 CFR 50.75(c) include only those decommissioning costs incurred by licensees to remove a facility or site safely from service, and reduce residual radioactivity to levels that permit: (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 cost of dismantling or demolishing non-radiological systems and structures is not included in the NRC decommissioning cost estimates. The costs of managing and storing spent fuel on site until transfer to DOE are not included in the cost formulas.
2. For the 28% trust, the earnings rate is the standard treasury rates for a one-year to 30-year Treasury note. Through 2005, this segment of the trust was only allowed to invest in government bonds. The 12% trust acquired from AEP Texas Central has been allowed to invest in equities as well as government and corporate bonds. An 8% return is assumed for these investments similar to the historical returns of the pension plan assets. In the future, the rates for the 28% piece will be similar to the 12% piece since both can now invest similarly.

Attachment 2 NOC-AE-06001990 Page 4 of 4 SOUTH TEXAS PROJECT 2005 NRC DECOMMISSIONING FUNDING STATUS REPORT CITY PUBLIC SERVICE OF SAN ANTONIO 12% Ownership of South Texas Project Unit 2 (Acquired from AEP Texas Central Company)

As provided in 10 CFR 50.75(f)(1), each power reactor licensee is required to report to the NRC on a calendar year basis, beginning March 31, 1999, and every two years thereafter on the status of its decommissioning funding for each reactor or share of reactor it owns. A licensee for a plant involved in a merger or acquisition shall submit the report annually. Funding information for the South Texas Project is provided below.

1. The minimum decommissioning fund estimate, pursuant to 10 CFR 50.75 (b) and (c)':

Total required: $ 41,086,886 Required by 12/31/05: $16,218,508

2. The amount accumulated by the end of the calendar year preceding the date of the report for items included in 10 CFR 50.75 (b) and (c): $40,640,773
3. A schedule of the annual amounts remaining to be collected for items in 10 CFR 50.75 (b) and (c).

Amount remaining: $101,153.763 Number of years to collect: 23

4. The assumptions used regarding escalation in decommissioning cost, rates of earnings on decommissioning funds, and rates of other factors used in funding projections:

Escalation rate: 4.72%

Assumed earnings rate2 : 8%

5. Any contracts upon which the licensee is relying pursuant to 10 CFR 50.75 (e)(1)(ii)(c): NONE
6. Any modifications to a licensee's current method providing financial assurance occurring since the last submitted report: NONE
7. Any material changes to trust agreements: This share of STP ownership acquired in May 2005.
1. The NRC formulas in section 10 CFR 50.75(c) include only those decommissioning costs incurred by licensees to remove a facility or site safely from service, and reduce residual radioactivity to levels that permit: (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 cost of dismantling or demolishing non-radiological systems and structures is not included in the NRC decommissioning cost estimates. The costs of managing and storing spent fuel on site until transfer to DOE are not included in the cost formulas.
2. For the 28% trust, the earnings rate is the standard treasury rates for a one-year to 30-year Treasury note. Through 2005, this segment of the trust was only allowed to invest in government bonds. The 12% trust acquired from AEP Texas Central has been allowed to invest in equities as well as government and corporate bonds. An 8% return is assumed for these investments similar to the historical returns of the pension plan assets. In the future, the rates for the 28% piece will be similar to the 12% piece since both can now invest similarly.

ATTACHMENT 3 SOUTH TEXAS PROJECT 2005 DECOMMISSIONING FUNDING STATUS REPORT CITY OF AUSTIN - AUSTIN ENERGY

Attachment 3 NOC-AE-06001990 Page 1 of 2 SOUTH TEXAS PROJECT 2005 NRC DECOMMISSIONING FUNDING STATUS REPORT CITY OF AUSTIN - AUSTIN ENERGY 16% Ownership of South Texas Project Unit 1 As provided in 10 CFR 50.75(f)(1), each power reactor licensee is required to report to the NRC on a calendar year basis, beginning March 31, 1999, and every two years thereafter on the status of its decommissioning funding for each reactor or share of reactor it owns. A licensee for a plant involved in a merger or acquisition shall submit the report annually. Funding information for the South Texas Project is provided below.

1. The minimum decommissioning fund estimate, pursuant to 10 CFR 50.75 (b) and (c)':

Total required: $ 54,782,552 Required by 12/31/05: $ 20,728,533

2. The amount accumulated by the end of the calendar year preceding the date of the report for items included in 10 CFR 50.75 (b) and (c). $48,356,041
3. A schedule of the annual amounts remaining to be collected for items in 10 CFR 50.75 (b) and (c).

Amount remaining: $51,608,379 Number of years to collect: 22

4. The assumptions used regarding escalation in decommissioning cost, rates of earnings on decommissioning funds, and rates of other factors used in funding projections:

Escalation rate: 5.16%

Assumed earnings rate: 6.0%

5. Any contracts upon which the licensee is relying pursuant to 10 CFR 50.75 (e)(1)(ii)(c): None
6. Any modifications to a licensee's current method providing financial assurance occurring since the last submitted report: None
7. Any material changes to trust agreements: None
1. The NRC formulas in section 10 CFR 50.75(c) include only those decommissioning costs incurred by licensees to remove a facility or site safely from service, and reduce residual radioactivity to levels that permit: (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 cost of dismantling or demolishing non-radiological systems and structures is not included in the NRC decommissioning cost estimates. The costs of managing and storing spent fuel on site until transfer to DOE are not included in the cost formulas.

Attachment 3 NOC-AE-06001990 Page 2 of 2 SOUTH TEXAS PROJECT 2005 NRC DECOMMISSIONING FUNDING STATUS REPORT CITY OF AUSTIN - AUSTIN ENERGY 16% Ownership of South Texas Project Unit 2 As provided in 10 CFR 50.75(f)(1), each power reactor licensee is required to report to the NRC on a calendar year basis, beginning March 31, 1999, and every two years thereafter on the status of its decommissioning funding for each reactor or share of reactor it owns. A licensee for a plant involved in a merger or acquisition shall submit the report annually. Funding information for the South Texas Project is provided below.

1. The minimum decommissioning fund estimate, pursuant to 10 CFR 50.75 (b) and (c)l:

Total required: $54,782,552 Required by 12/31/05: $20,183,045

2. The amount accumulated by the end of the calendar year preceding the date of the report for items included in 10 CFR 50.75 (b) and (c): $59,605,797
3. A schedule of the annual amounts remaining to be collected for items in 10 CFR 50.75 (b) and (c):

Amount remaining $59,248,960 Number of years to collect 23

4. The assumptions used regarding escalation in decommissioning cost, rates of earnings on decommissioning funds, and rates of other factors used in funding projections:

Escalation Rate: 5.16%

Assumed earnings rate: 6.0%

5. Any contracts upon which the licensee is relying pursuant to 10 CFR 50.75 (e)(1)(ii)(c): None
6. Any modifications to a licensee's current method providing financial assurance occurring since the last submitted report: None
7. Any material changes to trust agreements: None
1. The NRC formulas in section 10 CFR 50.75(c) include only those decommissioning costs incurred by licensees to remove a facility or site safely from service, and reduce residual radioactivity to levels that permit: (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 cost of dismantling or demolishing non-radiological systems and structures is not included in the NRC decommissioning cost estimates. The costs of managing and storing spent fuel on site until transfer to DOE are not included in the cost formulas.
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