ML14365A041

Vermont Yankee, Request for Consent to Cancel Lines of Credit

ML14365A041
Person / Time
Site:	Vermont Yankee File:NorthStar Vermont Yankee icon.png
Issue date:	12/19/2014
From:	McNeal S C Entergy Corp
To:	Dean W M Office of Nuclear Reactor Regulation
References
BVY 14-087, TAC MB3154
Download: ML14365A041 (3)

Text

SEntergyEntergy Corporation639 Loyola AvenuePO BOX 61000New Orleans, LATel 504 578 4363Steven C. McNealVice President and TreasurerBVY 14-087December 19, 2014Mr. William M. Dean, DirectorOffice of Nuclear Reactor RegulationU.S. Nuclear Regulatory CommissionWashington, DC 20555

SUBJECT: REFERENCERequest for Consent to Cancel Lines of CreditVermont Yankee Nuclear Power StationDocket No. 50-271License No. DPR-28S: 1. Letter. NRC toErtergy,2_Order-ApprovingTransfer-oLLicense4orVermont Yankee Nuclear Power Station from Vermont YankeeNuclear Power Corporation to Entergy Nuclear Vermont Yankee,LLC, and Entergy Nuclear Operations, Inc., and ApprovingConforming Amendment (TAC No. MB3154)," NVY 02-041, datedMay 17, 2002 (ML020390198) -2. Letter, Entergy to NRC, "Update to Decommissioning Funding StatusReport," BVY 14-082, dated December 19, 20143. Letter, Entergy to NRC, "Update to Irradiated Fuel ManagementProgram Pursuant to 10 CFR 50.54(bb)," BVY 14-085, datedDecember 19, 20144. Letter, Entergy to NRC, "Post-Shutdown Decommissioning ActivitiesReport," BVY 14-078, dated December 19, 2014

Dear Sir:

In Reference 1, the U.S. Nuclear Regulatory Commission (NRC) approved the transfer of theoperating license for Vermont Yankee Nuclear Power Station (VYNPS) from Vermont YankeeNuclear Power Corporation to Entergy Nuclear Vermont Yankee, LLC (ENVY) and Entergy NuclearOperations, Inc. (ENO). Condition (4) of the NRC's license transfer order required ENVY and ENOto maintain two lines of credit that they had represented in the license transfer application would beavailable to ENVY and ENO (through ENVY) to augment the revenue from projected power salesto ensure the safe operation of VYNPS: (1) a line of credit of $35 million from an affiliate company,Entergy Global Investments, Inc. (EGI) for the purpose of providing working capital and, ifnecessary, funds for the operation and maintenance of Vermont Yankee, and (2) a line of credit of$35 million from another affiliate, Entergy International Holdings Ltd. LLC (EIHL), to provide BVY 14-087 / Page 2 of 3additional financial resources if needed for the safe operation and maintenance of VYNPS,including the costs of nuclear property damage insurance and any retrospective premium pursuantto 10 CFR 140.21.This condition was continued in the VYNPS renewed facility operating license issued on March 21,2011 as License Condition 3.J:Entergy Nuclear Vermont Yankee, LLC and Entergy Nuclear Operations, Inc. shall take noaction to cause Entergy Global Investments, Inc., or Entergy International Holdings Ltd.LLC, or their parent companies to void, cancel, or modify the lines of credit to providefunding for Vermont Yankee as represented in the application without prior written consentof the Director of the Office of Nuclear Reactor Regulation.Significantly, this license condition was imposed to address the financial qualifications of ENVYand ENO to own and operate VYNPS, respectively, as required by 10 CFR 50.33(f). It was notimposed to address decommissioning funding assurance as required by 10 CFR 50.33(k).In Reference 2, ENO submitted an update to the Decommissioning Funding Status Report forVYNPS. Reference 2 demonstrates that, based on a decommissioning trust fund balance of$655.0 million as of October 31, 2014, a site specific decommissioning cost estimate (DCE), andaccounting for anticipated fund earnings during the decommissioning period, approximately $175.9million is projected to be remaining in the VYNPS decommissioning trust fund after completion oflicense termination and certain spent fuel management activities.1In Reference 4, ENO submitted the VYNPS Post Shutdown Decommissioning Activities Report_ (PSDARand sit~ edecommissioning-cost-estimate-(DCE-)pursuant-t_-l-G- FR -50.82(a)(4)(i).Once ENO dockets the certifications of permanent cessation of power operations and permanentremoval of fuel from the reactor vessel pursuant to 10 CFR 50.82(a)(1), the VYNPS 10 CFR Part50 license will no longer authorize operation of the reactor or emplacement or retention of fuel intothe reactor vessel and there will be no further operation and maintenance activities associated withan operating nuclear power reactor. Accordingly, the need to maintain the EGI and EIHL creditlines to provide additional funding sources to support operation of VYNPS will no longer exist.ENVY plans to rely upon its decommissioning trust fund to pay for the costs associated withactivities necessary to support the planned decommissioning of VYNPS. As shown above and inReference 2, as of October 31, 2014, the VYNPS decommissioning trust fund is expected to haveapproximately $175.9 million remaining after completion of license termination and operationalspent fuel management activities that will be funded from the trust fund -demonstrating adequatefinancial assurance. Moreover, since the DCE has been submitted (Reference 4), an annual trustfund status report will be submitted pursuant to 10 CFR 50.82(a)(8)(v). 10 CFR 50.82(a)(8)(vi)requires that the status report include additional financial assurance if the fund is projected to fallbelow the NRC minimum. This requirement provides additional assurance that sufficient funds willbe in place to complete the decommissioning of VYNPS. Finally, the PSDAR included a newregulatory commitment by which Entergy Corporation will provide or (if already existing) increase aparent company guarantee to provide a total in parental assurance of up to 10% of the remainingtrust fund balance or $40 million, whichever is less, in the event that additional financial assuranceAs discussed in the Irradiated Fuel Management Program Update (Reference 3), costs related to spentfuel management operations (e.g., operations and maintenance costs for the spent fuel pool andIndependent Spent Fuel Storage Installation, totaling approximately $225 million) will be funded from thedecommissioning trust fund, assuming that ENO obtains an exemption that allows the use of trust fundsfor spent fuel management activities.

BVY 14-087 / Page 3 of 3beyond the amounts contained in the remaining trust fund for VYNPS is required pursuant to NRCregulations to complete radiological decommissioning and spent fuel management at VYNPS.For these reasons, this letter requests written consent of the Director of the Office of NuclearReactor Regulation to cancel the EGI and EIHL lines of credit in their entirety, pursuant to LicenseCondition 3.J. ENO requests that written consent be provided within 90 days of the docketing ofthe certifications of permanent cessation of power operations and permanent removal of fuel fromthe reactor vessel pursuant to 10 CFR 50.82(a)(1).There are no regulatory commitments made in this letter. If you have any questions on thistransmittal, please contact Mr. Philip Couture at 802-451-3193.

Sincerely,SCM/plccc: ATTN: Document Control DeskU.S. Nuclear Regulatory CommissionWashington, DC 20555Mr. Daniel H. DormanU.S. Nuclear Regulatory Commission2100 Renaissance Blvd, Suite 100King of Prussia, PA 19406-2713Mr. James S. Kim, Project ManagerDivision of Operating Reactor LicensingOffice of Nuclear Reactor RegulationU.S. Nuclear Regulatory CommissionMail Stop 08D15Washington, DC 20555USNRC Resident InspectorVermont Yankee Nuclear Power Station320 Governor Hunt RoadVernon, VT 05354Mr. Christopher Recchia, CommissionerVT Department of Public Service112 State Street, Drawer 20Montpelier, VT 05620-2601Entergy Nuclear Vermont Yankee, LLCc/o Entergy Nuclear Operations, Inc.Christopher J. Wamser, Site Vice PresidentP.O. Box 0250320 Governor Hunt RoadVernon, VT 05354