ML071280291

Guarantee of Payment of Deferred Premiums, 10 CFR 140.21

ML071280291
Person / Time
Site:	Wolf Creek
Issue date:	04/30/2007
From:	Stull A Wolf Creek
To:	Document Control Desk, Office of Nuclear Reactor Regulation
References
CO 07-0004
Download: ML071280291 (7)

Text

WLF rNUCLEAR CREEK OPERATING CORPORATION Annette F. Stull Vice President and Chief Administrative Officer April 30, 2007 (620)364-4004 (620)364-4017 facsimile anstull@wcnoc.com CO 07-0004 ATTN: Document Control Desk Director, Office of Nuclear Reactor Regulation U. S. Nuclear Regulatory Commission Washington, D.C. 20555-0001

Subject:

Docket No: 50-482 - Guarantee of Payment of Deferred Premiums, 10 CFR 140.21 Gentlemen:

Pursuant to the requirements of 10CFR 140.21, each operating reactor licensee is required to maintain financial protection through guarantees of payment of deferred premiums. The owners of Wolf Creek Generating Station are providing the enclosed documentation of their ability to pay deferred premiums in the amount of fifteen million dollars, as required by 10 CFR 140.21 (e).

Kansas Gas and Electric Company (KGE), a wholly-owned subsidiary of Westar Energy, Inc.,

Kansas City Power & Light Company (KCPL), a wholly-owned subsidiary of Great Plains Energy Incorporated, and Kansas Electric Power Cooperative, Inc. (KEPCo) have each provided audited Consolidated Statements of Cash Flows in order to demonstrate sufficient funds are available to meet their share of the deferred premiums.

If you have any questions concerning this matter, please contact me at (620) 364-4004 or Mr.

Kevin Moles at (620) 364-4126.

Sincerely Annette F. Stull AFS/rlt Enclosures (3) cc: J. N. Donohew (NRC), w/e V. G. Gaddy (NRC), w/e B. S. Mallett (NRC), w/e Senior Resident Inspector (NRC), w/e P.O. Box 411 / Burlington, KS 66839 / Phone: (620) 364-8831 An Equal Opportunity Employer M/F/HCNVET

I SU IfiT PLREHMI HITY February 28, 2007 Mr. Todd Laflin Wolf Creek Nuclear Operating Corporation P.O. Box 411 Burlington, KS 66839

Dear Todd,

Pursuant to the requirements of 10 CFR1 40.21(e), Kansas City Power & Light Company is providing the attached audited Consolidated Statements of Cash Flows to provide evidence of the ability to make payment of its share of deferred premiums in an amount of $7.1 million.

To the best of my knowledge, I certify that the foregoing memorandum with respect to Kansas City Power & Light Company's cash flow for the year 2006 is true and correct.

Sjrperely, Attachment P.O. Box 418679 w KANSAS CITY, MO 64141-9679 U TEL 816.556.2200 M WWW.KCPL.COM 0 WWW.GREATPLAINSENERGY.COM

I

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KANSAS CITY POWER & LIGHT COMPANY Consolidated Statements of Cash Flows As Adjusted As Adjusted Year Ended December 31 2006 2005 2004 Cash Flows from Operating Activities (thousands)

Net income $ 149,321 $ 143,645 $ 145,028 Adjustments to reconcile income to net cash from operating activities:

Depreciation and amortization 152,714 146,610 145,246 Amortization of:

Nuclear fuel 14,392 13,374 14,159 Other 6,617 7,681 7,719 Deferred income taxes, net 17,411 (33,637) 11,801 Investment tax credit amortization (1,240) (3,889) (3,984)

(Gain) loss on property (572) 4,613 5,133 Minority interest in subsidiaries 7,805 (5,087)

Other operating activities (Note 2) (39,408) 79,284 (3,756)

Net cash from operating activities 299,235 365,486 316,259 Cash Flows from Investing Activities Utility capital expenditures (475,931) (332,055) (190,548)

Allowance for borrowed funds used during construction (5,686) (1,598) (1,498)

Purchases of nonutility property (62) (127) (254)

Proceeds from sale of assets 433 469 7,465 Purchases of nuclear decommissioning trust investments (49,667) (34,607) (49,720)

Proceeds from nuclear decommissioning trust investments 46,005 31,055 46,167 Hawthorn No. 5 partial insurance recovery - 10,000 30,810 Hawthorn No. 5 partial litigation recoveries 15,829 - 1,139 Other investing activities (983) (930) (7,100)

Net cash from investing activities (470,062) (327,793) (163,539)

Cash Flows from Financing Activities Issuance of long-term debt - 334,417 Repayment of long-term debt - (335,922) (209,140)

Net change in short-term borrowings 124,550 32,376 (21,959)

Dividends paid to Great Plains Energy (89,000) (112,700) (119,160)

Equity contribution from Great Plains Energy 134,615 - 225,000 Issuance fees (511) (4,522) (2,362)

Net cash from financing activities 169,654 (86,351) (127,621)

Net Change in Cash and Cash Equivalents (1,173) (48,658) 25,099 Cash and Cash Equivalents at Beginning of Year 2,961 51,619 26,520 Cash and Cash Equivaients at End of Year $ 1,788 $ 2,961 $ 51,619 The disclosures regarding consolidated KCP&L included inthe accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

SKGEo April 11, 2007 Mr. Thomas J. Robke Wolf Creek Nuclear Operating Corporation PO Box 411 Burlington, KS 66839

Dear Mr. Robke:

Pursuant to the requirements of 10 CFR 140.2 1(e), Kansas Gas & Electric Company is providing the attached audited Statement of Cash Flows regarding its ability to make payment of its share of deferred premiums in an amount of $7.1 million.

The undersigned certifies that the foregoing memorandum with respect to Kansas Gas &

Electric Company's cash flow for the year 2006 is true and correct to the best of his knowledge and belief.

Sincerely, 2Lee Wage Vice President, Controller Westar Energy Jmm Attachment cc: Angela Smith 818 South Kansas Avenue I P.O. Box 889 I Topeka, Kansas 66601 Office Telephone: (J85)575-6300

I KANSAS GAS AND ELECTRIC COMPANY STATEMENTS OF CASH FLOWS (Dotlars in Thousands)

Year Ended December3 1.

2006 2005 CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES:

Net income .......................................................................................... S 73,472 $ 85,577 Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization ................................................................. 94,059 80,482 Amortization of nuclear fuel ................................................................... (13,851) 13,315 Amortization of deferred gain from sale-leaseback........................................... (5,495) (8,469)

Amortization of corporate-owned life insurance.............................................. 14,305 13,510 Net deferred taxes............................................................................... 13,141 1,780 Net changes in energy marketing assets and liabilities ...................................... (3,612) 2,109 Changes in working capital items:

Accounts receivable, net........................................................................ 56,921 (32,124)

Inventories and supplies ........................................................................ (15,818) 6,729 Prepaid expenses and other .................................................................... (57,825) (57,477)

Accounts payable................................................................................ 12,827 (13,100)

Payable to affiliates ............................................................................. (34,592) 62,745 Other current liabilities ......................................................................... (5,697) 4,981 Changes in other assets .............................................................................. 39,864 (14,423)

Changes in other liabilities.......................................................................... (63.733) _6488 Cash flows from operating activities ............................................... 103,96 1.j2914.7 CASH FLOWS FROM (USED IN) INVESTING ACTIVITIES:

Additions to property, plant and equipment ...................................................... (146,521) (87,172)

Purchase of securities within the nuclear decommissioning trust fund......................... (345,541) (372,426)

Sale of securities within the nuclear decommissioning trust fund .............................. 341,410 367,570 Investment in corporate-owned life insurance..................................................... (19,127) (19,346)

Proceeds from investment in corporate-owned life insurance.................................... 22,684 10,997 Proceeds from other investments ................................................................... 4,22 11,734 Cash flows used in investing activities .... ........................................ (142,973) (_f8864J3 CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES:

Proceeds from long-term debt....................................................................... 99,662-Retirements of long-term debt ..................................................................... (200.000) (65,000)

Investment by parent................................................................................. 100,000 -

Borrowings against cash surrender value of corporate-owned life insurance................... 59,697 58,039 Repayment of borrowings against cash surrender value of coxporate-owned life insurance ........................................................................ ................ (22,828) (11,877)

Dividends to parent company ........................................................ ................ - (20,000)

Cash flows from (used in) financing activities...................................... 36,531 (38.838)

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS ......................... (2,476) 1,666 CASH AND CASH EQUIVALENTS:

Beginning of period ......................................................................................... 248812 End of period ........................................................................................ ___

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:

CASH PAID FOR:

Interest on financing activities, net of amount capitalized................................. $ 18,071 S 26,041 NON-CASH INVESTING TRANSACTIONS:

Property, plant and equipment additions .................................................... $S 12,917 S 2,533 NON-CASH FINANCING TRANSACTIONS:

Conversion of intercompany payable ........................................................ S 120,000 $ -

KansasElectric PowerCooperative,Inc.

April 15, 2007 Ms. Annette Stull Wolf Creek Nuclear Operating Corporation P.O. Box 411 Burlington, KS 66839

Dear Annette:

Pursuant to the requirements of 10 CFR 140.21(e), Kansas Electric Power Cooperative, Inc. is providing the attached audited Statement of Cash Flows to show its ability to make payment of its share of deferred premiums in an amount of $900,000.

The undersigned certifies that the foregoing memorandum with respect to Kansas Electric Power Cooperative, Inc.'s. Cash flow for the year 2006 is true and correct to the best of her knowledge and belief.

Sincerely yours,

&&1//ft UL4, Coleen M.Wells VP Finance, and Controller Phone: 785.273.7010 Enclosure (1)

Fax: 785.271.4888 www.kepco.org PO. Box 4877 Topeka, KS 66604-0877 600 Corporate View Topeka, KS 66615 A Touchstone Enrgy* Cooperte 0 )

lit Kansas Electric Power Cooperative, Inc.

Consolidated Statements of Cash Flows Years Ended December 31, 2006 and 2005 2006 2005 Operating Activities Net margins $ 1,046,682 $ 3,451,857 Adjustments to reconcile net margin to net cash provided by operating activities Depreciation and amortization 3,704,711 3,911,449 Decommissioning 1,458,328 451,304 Amortization of nuclear fuel 1,748,780 1,681,987 Amortization of deferred charges 4,588,218 4,045,720 Amortization of deferred incremental outage costs 2,557,796 3,470,606 Amortization of debt issuance costs 125,432 129,895 Changes in Member accounts receivable 637,183 (1,326,340)

Materials and supplies (156,089) (42,261)

Other assets and prepaid expenses 120,250 (202,794)

Accounts payable 208,536 284,122 Payroll and payroll-related liabilities 20,971 (2,444)

Accrued property tax 25,533 (16,441)

Accrued interest payable 155,139 51,333 Restricted assets (33,328) (49,836)

Other long-term liabilities (300,801) 249,471 Net cash provided by operating activities 15,907,341 16,087,628 Cash Flows From Investing Activities Additions to electric plant (6,034,758) (1,469,394)

Additions to nuclear fuel (3,179,023) (615,088)

Additions to deferred incremental outage costs (4,078,059) (3,556,885)

Investments in decommissioning fund assets (1,292,261) (451,304)

Other 20,047 Net cash used in investing activities (14,564,054) (6,092,671)

Cash Flows From Financing Activities Net borrowing under line of credit agreement 3,521,0 28 Principle payments on long-term debt (10,464,3 48) (9,907,800)

Increase in debt issuance costs related to debt refinancing - (670,489)

Utilization of RUS cushion of credit 3,526,3 41 698,771 Net cash used in financing activities (3,416,9 79) (9,879,518)

Net increase (decrease) in cash and cash equivalents (2,073,692) 115,439 Cash and Cash Equivalents, Beginning of Year 5,345,163 5,229,724 Cash and Cash Equivalents, End of Year $ 3.271.471 $ 5.345.163 Supplemental Cash Flows Information Cash paid during the year for interest $ 8,385,104 $ 8,852,162 See Notes to ConsolidatedFinancialStatements 5