ML13086A010

Letter to W. Norton Request for Exemption from Title 10 of the Code of Federal Regulations 50.38 Requirements for Main Yankee Atomic Power Company, Connecticut Yankee Atomic Power Company, and Yankee Atomic Electric Company

ML13086A010
Person / Time
Site:	Haddam Neck, Yankee Rowe, Maine Yankee
Issue date:	07/15/2013
From:	Lombard M D NRC/NMSS/SFST
To:	Norton W Connecticut Yankee Atomic Power Co, Yankee Atomic Electric Co
Goshen J M
Shared Package
ML13227A348	List: ML13086A010 ML13228A225
References
NCP-2013-003, TAC L24538, TAC L24565, TAC L24566
Download: ML13086A010 (15)

Text

July 15, 2013 Mr. Wayne Norton, Chief Executive Officer and President of Yankee Atomic and Connecticut Yankee Chief Nuclear Officer of Maine Yankee 362 Injun Hollow Road East Hampton, CT 06424-3099

SUBJECT:

REQUEST FOR EXEMPTION FROM TITLE 10 OF THE CODE OF FEDERAL REGULATIONS 50.38 REQUIREMENTS FOR MAINE YANKEE ATOMIC POWER COMPANY, CONNECTICUT YANKEE ATOMIC POWER COMPANY, AND YANKEE ATOMIC ELECTRIC COMPANY - (TAC NOS. L24538, L24565, AND L24566)

Dear Mr. Norton:

By letter dated May 16, 2011 (Agencywide Documents Access and Management System Accession No. ML11139A088), as supplemented August 16, 2011 (ML11235A723), you submitted a request for exemption from Title 10 of the Code of Federal Regulations (10 CFR) 50.38 requirements for the Maine Yankee Atomic Power Company, Connecticut Yankee Atomic Power Company, and the Yankee Atomic Electric Company. This letter provides the results of the U.S. Nuclear Regulatory Commission's (NRC's) review of your request. Your request concerned an exemption from the foreign ownership, control, or domination prohibition under 10 CFR 50.38, in accordance with 10 CFR 50.12.

The NRC Staff reviewed the exemption request and determined that it may be granted. The NRC Staff Evaluation is enclosed, and it arti culates the basis for granting the exemption request.

The NRC has determined that this action meets the eligibility criteria for categorical exclusion set forth in 10 CFR 51.22(c)(25)(vi)(I). Therefore, pursuant to 10 CFR 51.22(b), no environmental impact statement or environmental assessment need be prepared in connection with this action. The exemption is effective upon issuance.

In accordance with 10 CFR 2.390 of the NRC's "Rules of Practice," 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 the NRC's Agencywide Documents Access and Management System (ADAMS). ADAMS is accessible from the NRC Website at http://www.nrc.gov/reading-rm/adams.html (the Public Electronic Reading Room).

If you have any questions regarding this matter, please contact me at (301) 287-0673 or John Goshen of my staff at (301) 287-9250.

Sincerely,

/RA/ Mark D. Lombard, Director Division of Spent Fuel Storage and Transportation Office of Nuclear Material Safety and Safeguards

Docket Nos.: 50-029, 50-213, 50-309,72-030, 72-031,72-039

TAC Nos.: L24538, L24565, L24566

Enclosure:

As stated

cc: Maine Yankee Atomic Power Station Service List Haddam Neck Plant Service List Yankee (Rowe) Nuclear Power Station Service List Northeast Utilities Service List ENCLOSURE STAFF EVALUATION BY THE DIVISION OF SPENT FUEL STORAGE AND TRANSPORTATION -

REQUEST FOR EXEMPTION FROM TITLE 10 OF THE CODE OF FEDERAL REGULATIONS 50.38 REQUIREMENTS FOR MAINE YANKEE ATOMIC POWER COMPANY, CONNECTICUT YANKEE ATOMIC POWER COMPANY, AND YANKEE ATOMIC ELECTRIC COMPANY DOCKET NOS.50-029, 50-213, 50-309,72-030, 72-031,72-039

1 INTRODUCTION

By letter dated May 16, 2011 (Agencywide Documents Access and Management System (ADAMS) Accession No. ML11139A088), as supplemented August 16, 2011 (Accession No.

ML11235A723), Maine Yankee Atomic Power Company (Maine Yankee), Connecticut Yankee Atomic Power Company (Connecticut Yankee), and the Yankee Atomic Electric Company (Yankee Atomic) (together, the licensees or the Yankee Companies) submitted a request for

exemption from Title 10 of the Code Of Federal Regulations (10 CFR) 50.38 requirements.

This staff evaluation (SE) provides the results of the U.S. Nuclear Regulatory Commission staff's (NRC staff or staff) review of the request. In accordance with 10 CFR 50.12, the licensees requested an exemption from the foreign ownership, control, or domination (FOCD) restrictions in 10 CFR 50.38, 2 BACKGROUND The Yankee Companies hold 10 CFR Part 50 possession only licenses for the following facilities: Haddam Neck Plant (Connecticut Yankee); Maine Yankee Atomic Power Station (Maine Yankee); and, Yankee Nuclear Power Station (Yankee Atomic), (together, "the facilities"). The facilities ceased power operations between 1991 and 1997, and all have completed the decommissioning process. All reactor plant facilities have been dismantled and removed, and only the independent spent fuel storage installations (ISFSIs) remain at the stations. The 10 CFR Part 50 licenses for operation of the stations have thus been amended to allow for only the possession of spent nuclear fuel (SNF). Under 10 CFR 72, Subpart K, "General License for Storage of Spent Fuel at Power Reactor Sites," the Yankee Companies are authorized to store spent fuel. Specifically, under 10 CFR 72.210, the Yankee Companies have a general license to store spent fuel in an ISFSI at each site by virtue of their Part 50 licenses to possess nuclear power reactors.

Each Yankee Company is partially indirectly owned by foreign entities. The two co-owners of Connecticut Yankee with foreign parents control a total of 25.5 % of the licensee. The foreign parents of the co-owners are Spanish and British entities (Ibedrola (Spain), 6%; National Grid (Britain), 19.5%). The two co-owners of Yankee Atomic with foreign parents control a total o f 44.0 % of the licensee (Ibedrola, 9.5%; National Grid, 34%). The co-owners of Maine Yankee with foreign parents control a total of 74.0 % of the licensee (Ibedrola, 38%; National Grid, 24%;

Emera (Canada), 12%). The remaining ownership percentages are indirectly owned by Northeast Utilities, a U.S. entity.

In the exemption application, the licensees stated that Sections 103d. and 104d. of the Atomic Energy Act (AEA), apply only to a license for a production or utilization facility as defined in the AEA. The licensees stated that regardless of their 10 CFR Part 50 licenses, the possession only conditions of the licenses do not allow their use as a production or utilization facility, and they are therefore not subject to Sections 103d. or 104d. of the AEA.

3 DISCUSSION 3.1 Regulatory Basis Pursuant to 10 CFR 50.12(a)(1), the Commission may grant exemptions from the requirements of the regulations which:

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. Section 103d. of the Atomic Energy Act states that:

No license may be issued to an alien or any corporation or other entity if the Commission knows or has reason to believe it is owned, controlled, or dominated by an alien, a foreign corporation or a foreign government. In any event, no license may be issued to any person within the United States if, in the opinion of the Commission, the issuance of a license to such person would be inimical to the common defense and security or to the health and safety of the public.

Section 104d. has an identical prohibition.

10 CFR 50.38 is the regulatory provision that implements these sections of the statute;

Any . . . corporation, or other entity which the Commission knows or has reason to believe is owned, controlled or dominated by an alien, a foreign corporation, or a foreign government, shall be ineligible to apply for and obtain a license.

3.2 Exemption is Authorized by Law In its evaluation of the licensees' application, the NRC staff reviewed the following documents:

• The Atomic Energy Act of 1954, as amended.

• Office of the Secretary (SECY)78-378, "Licensing of Spent Fuel Storage in an Independent Spent Fuel Installation (ISFSI)," (ADAMS Accession No. ML12235A870).

• "Storage of Spent Fuel in an Independent Spent Fuel Storage Installation (ISFSI)"

Proposed Rule, 43 FR 46,309 (1978).

• "Licensing Requirements for the Storage of Spent Fuel in an Independent Spent Fuel Storage Installation" Final Rule, 45 FR 74,693 (1980).

• Nuclear Waste Policy Act of 1982 (NWPA)

• "Storage of Spent Nuclear Fuel in NRC - Approved Storage Casks at Nuclear Power Reactor Sites," Proposed Rule, 54 FR 19,380 (1989).

• "Storage of Spent Nuclear Fuel in NRC - Approved Storage Casks at Nuclear Power Reactor Sites," Final Rule, 55 FR 29,181 (1990).

After reviewing the AEA, the staff concluded that Section 103d. does not apply to ISFSIs. The plain language of the statute demonstrates that it applies to commercial licenses for production and utilization facilities.

1 The section, which refers to "license[s] under this section" and therefore applies solely to licenses for production or utilization facilities, states that "[n]o license may be issued to an alien or any corporation or other entity if the Commission knows or has reason to believe it is owned, controlled, or dominated by an alien, a foreign corporation, or a foreign government." Thus, unless the AEA definitions of "production facility" and "utilization facility" encompass an ISFSI, Section 103d. does not preclude the NRC from granting the Yankee Companies an exemption from 10 CFR 50.38.

Section 11v. of the AEA defines a production facility as:

(1) any equipment or device determined by rule of the Commission to be capable of the production of special nuclear material in such quantity as to be of significance to the common defense and security, or in such a manner as to affect the health and safety of the public; or (2) any important component part especially designed for such equipment or device as determined by the Commission.

Section 11cc. of the AEA defines a utilization facility as:

(1) any equipment or device, except an atomic weapon, determined by rule of the Commission to be capable of making use of special nuclear material in such quantity as to be of significance to the common defense and security, or in such a manner as to affect the health and safety of the public, or peculiarly adapted for making use of atomic energy in such quantity as to be of significance to the common defense and security, or in such manner as to affect the health and safety of the public; or (2) any important component especially designed for such equipment or device as determined by the Commission.

1 AEA §§ 101, 103.

Additionally, the Commission's regulations at 10 CFR 50.2 defines "production facility" as a facility designed or used for the formation or processing of nuclear material, and "utilization facility" as "any nuclear reactor other than one designed or used primarily for the formation of

plutonium or U-233."

As an ISFSI is neither "capable of the production of special nuclear material" nor "capable of making use of special nuclear material," it is neither a production facility nor a utilization facility under the AEA. Furthermore, an ISFSI is not designed or used for the formation or processing of nuclear material and is not a nuclear reactor. Accordingly, an ISFSI is neither a production facility nor a utilization facility under 10 CFR Part 50. As such, the section 103d. prohibition on FOCD entities does not apply to an ISFSI, regardless of whether it is licensed under 10 CFR Part 50 or 10 CFR Part 72, and therefore does not preclude the NRC from granting the Yankee Companies an exemption from the FOCD requirements of 10 CFR 50.38.

The Staff also reviewed SECY 78-378, which proposed issuing a new regulation, 10 CFR Part 72, for comment, which would establish specific licensing requirements for storage of spent fuel in an ISFSI. SECY 78-378 evaluated four alternatives (options) for expanding the regulations. Alternative 4 proposed to, "amend 10 CFR Part 50 (Licensing of Production and Utilization Facilities) to define an ISFSI as a utilization facility and to cover the specific activity of storage of spent fuels in an ISFSI."

2 The Commission found this alternative not acceptable, and a primary reason was that "[d]efining an ISFSI, which is for storage only, as a "utilization facility" may be questionable." Thus, the Commission was aware that including ISFSIs in the definition of utilization facility could be problematic at the time it approved the expansion of the Commission's regulations.

The Commission chose Alternative 3 which would, "adopt a new Part covering the specific activity of spent fuel storage in an ISFSI." 10 CFR Part 72 became effective on November 28, 1980 (45 FR 74,693). Neither the draft nor the final rule contained the FOCD restrictions required by Section 103d. or 104d. of the AEA.

The staff reviewed the NWPA and the proposed and final rule change incorporating the 10 CFR Part 72, Subpart K, General License into 10 CFR Part 72 (10 CFR 72.210 to 220) and found no additional guidance regarding the 10 CFR 50.38 FOCD requirements for 10 CFR Part 50 licensees operating ISFSIs under the General License provision. The staff therefore finds that, since the Licensees are ISFSIs and an ISFSI is neither a utilization nor a production facility under the definitions in the AEA, the prohibition in Section 103d. of the AEA against foreign ownership, domination and control is inapplicable to the Licensees, and that granting the exemption is allowed by law.

3.3 The Exemption Presents no Undue Risk to Public Health and Safety The staff finds the requirements of 10 CFR 50.38 are intended to prevent the FOCD of production and utilization facilities. As stated in this safety evaluation (SE), section 3.2, the Yankee facilities are neither production nor ut ilization facilities as defined in the AEA. Additionally, since FOCD Restrictions are financial ownership restrictions and are neither 2 Alternative 1 proposed no rulemaking action; Alternative 2 proposed amendment of Part 70 to cover ISFSIs; and, Alternative 3 (the alternative adopted) proposed Part 72.

technical nor operational requirements, granting the exemption has no bearing on the risk to public health and safety.

3.4 The Exemption is Consistent with the Common defense and security The Yankee Companies are restricted by their lic enses to only storing SNF in ISFSIs approved under 10 CFR 72.214. The underlying purpose of the 10 CFR 50.38 FOCD prohibition is to

prevent foreign control over production and utilization facilities as defined by the AEA. As stated in this SE, section 3.2, the Yankee facilities are neither production nor utilization facilities as defined in the AEA. In addition, there are no FOCD restrictions placed on similarly situated 10 CFR Part 72 ISFSIs with specific licenses to store SNF. Such licensees have similar security and common defense concerns, and similar considerations apply. The staff finds, therefore, that granting the exemption is consistent with the common defense and security.

3.5 Special Circumstances Evaluation The Commission cannot grant an exemption unless special circumstances apply per 10 CFR 50.12(a)(2), and application of the regulation would not serve the underlying purpose of the rule or is not necessary to achieve the underlying purpose of the rule per

10 CFR 50.12(a)(2)(ii).

The Yankee Companies are restricted to by their licenses to only store SNF in ISFSIs approved by 10 CFR 72.214. The underlying purpose of 10 CFR 50.38 is to implement the FOCD restrictions of sections 103d. and 104d. of the AEA and to prevent foreign control, domination or ownership over production and utilization facilities as defined by the AEA. As stated in this SE, section 3.3, the facilities owned by the Yankee Companies are not production or utilization facilities as defined in the AEA. The staff determined that there are no 10 CFR 50.38 FOCD restrictions placed on 10 CFR Part 72 ISFSIs with specific licenses that are similarly situated. Such licensees are similarly situated to the Yankee facilities and similar considerations apply. The staff finds, therefore, that applying the 10 CFR 50.38 FOCD requirement clearly does not serve the underlying purpose of the rule, and granting the exemption is consistent with the special circumstances as defined in 10 CFR 50.12(a)(2)(ii).

3.6 Environmental Evaluation The staff has determined that this action meets the eligibility criteria for categorical exclusion set forth in 10 CFR 51.22(c)(25)(vi)(I), "Other requirements of an administrative, managerial, or organizational nature." Therefore, pursuant to 10 CFR 51.22(b), no environmental impact statement or environmental assessment need be prepared in connection with this action, and granting the exemption, therefore, does not present an undue risk to the public health and

safety. 4 CONCLUSIONS The staff finds granting the licensee's exemption request from 10 CFR 50.38 FOCD requirements acceptable for the justifications provided in Section 3.0 above.

Principal contributor: John Goshen, P.E.

If you have any questions regarding this matter, please contact me at (301) 287-0673 or John Goshen of my staff at (301) 287-9250.

Sincerely,

/RA/ Mark D. Lombard, Director Division of Spent Fuel Storage and Transportation Office of Nuclear Material Safety and Safeguards

Docket Nos.: 50-029, 50-213, 50-309,72-030, 72-031,72-039 TAC Nos.: L24538, L24565, L24566

Enclosure:

As stated

cc: Maine Yankee Atomic Power Station Service List Haddam Neck Plant Service List Yankee (Rowe) Nuclear Power Station Service List Northeast Utilities Service List

DISTRIBUTION:

SFST R/F CHaney MWeber MFerdas RI D McIntyre PAO, NMcNamara RI, NSheehan R1, SUttal Closes out TACs L24538, L24565, L24566 G:\SFST\Northeast Utilities\FOCD exemption\5 16 11 exemption request evaluation grant.docx ADAMS: ML13086A010; ML13227A348; ML13228A225 OFC NMSS/SFST NMSS/SFST NRR/DIRS OGC- NLO NMSS/SFST NAME JGoshen WWheatley RAllwein- non concurrence SUttal MSampson DATE 2/21 /2013 2/ 21 /2013 3/---/2013 3/ 19 /2013 3/22 /2013 OFC NMSS/SFST NMSS/SFST NAME AHsia MLombard DATE 4/9/2013 7/ 15 /2013 OFFICIAL RECORD COPY cc: Northeast Utilities Service List

Duncan MacKay, Esquire Deputy General Counsel Northeast Utilities Service Company

107 Seldea Street

Berlin, CT 06037

Joseph Fay, Esquire Maine Yankee Atomic Power Company 321 Old Ferry Road Wiscasset, ME 04578-4922

Gerald Garfield Day Pitney, LLP

242 Trumbull Street

Hartford, CT 06103

Tim Mathews Morgan, Lewis & Bockius, LLP

1111 Pennsylvania Ave., NW Washington, D.C. 20004-2541

Neven Rabadjija Associate General Counsel NSTAR 800 Boylston Street, 17 th Floor Boston, MA 02199

David A. Repka, Esq.

Winston & Strawn LLP

1700 K Street, N.W.

Washington, DC 20006-3817

Yankee (Rowe) Nuclear Power Station Service List:

cc:

Mr. Wayne Norton President and Chief Executive Officer Yankee Atomic Electric Company

49 Yankee Road Rowe, MA 01367

Mr. Joseph Fay

General Counsel Yankee Atomic Electric Company 49 Yankee Road Rowe, MA 01367

Mr. Robert Capstick

Regulatory Affairs Director Yankee Atomic Electric Company 77 Lakewood Rd.

Newton, MA 02461

Assistant Attorney General Commonwealth of Massachusetts 200 Portland Street Boston, MA 02114

Beverly Anderson, MPH, RS

Interim Director Radiation Control Program Department of Public Health

Schrafft Center, Suite 1M2A

529 Main Street Charlestown, MA 02129

Secretary Massachusetts Executive Office of Public

Safety One Ashburton Place Room 2133 Boston, MA 02108

Peggy Sloan, AICP Franklin Regional Council of Governments 425 Main Street, Suite 20

Greenfield, MA 01301-3313

Regional Administrator, Region I U.S. Nuclear Regulatory Commission 2100 Renaissance Boulevard Renaissance Park

King of Prussia, PA 19406

Diane Screnci, Region I U.S. Nuclear Regulatory Commission 2100 Renaissance Boulevard

Renaissance Park

King of Prussia, PA 19406

Mr. Robert Mitchell ISFSI Manager Yankee Atomic Electric Company

49 Yankee Road

Rowe, MA 01367

John Giarrusso State Liaison Officer Division Chief, Planning and Preparedness Massachusetts Emergency Management

Agency 400 Worcester Road Framingham, MA 01702-5399

Maine Yankee Atomic Power Station Service List:

Senator Charles Pray State Nuclear Safety Advisor

State Planning Office State House Station #38

Augusta, ME 04333

First Selectman of Wiscasset Municipal Building U.S. Route 1 Wiscasset, ME 04578

Friends of the Coast P.O. Box 98 Edgecomb, ME 04556

Mr. Jonathan M. Block Attorney at Law P.O. Box 566 Putney, VT 05346 0566

Joseph Fay, Esquire Maine Yankee Atomic Power Company 321 Old Ferry Road Wiscasset, ME 04578-4922

Mr. Gerald Poulin Chairman and President Maine Yankee Atomic Power Company 321 Old Ferry Road Wiscasset, ME 04578-4922

Director Division of Health Engineering Department of Human Services #10 State House Station

Augusta, ME 04333

Mr. Patrick J. Dostie State of Maine Nuclear Safety Inspector Department of Health and Human Services

Maine Public Health Division of Environmental Health 286 Water St., Key Plaza - 8th Floor State House Station 11 Augusta, ME 04333

Mr. Jay Hyland State of Maine 286 Water St., Key Plaza - 8th Floor

State House Station 11

Augusta, ME 04333

Regional Administrator, Region I U.S. Nuclear Regulatory Commission 2100 Renaissance Boulevard

Renaissance Park

King of Prussia, PA 19406

Decommissioning Branch Chief, Region I U.S. Nuclear Regulatory Commission 2100 Renaissance Boulevard

Renaissance Park

King of Prussia, PA 19406 David Lewis, Esquire

Shaw Pittman

2300 North Street, NW Washington, DC 20037

Mr. James Connell ISFSI Manager Maine Yankee Atomic Power Company 321 Old Ferry Road Wiscasset, ME 04578-4922 Mr. Randall L. Speck Kaye, Scholer, Fierman, Hayes & Handler,

LLP The McPherson Building 901 Fifteenth Street, NW Suite 1100 Washington, DC 20005-2327

Haddam Neck Plant Service List:

Mr. Brantley Buerger Manager, Haddam Neck Plant ISFSI Connecticut Yankee Atomic Power

Company

362 Injun Hollow Road East Hampton, CT 06424-3099 Assistant Director

Office of Policy and Management Policy Development and Planning Division 450 Capitol Avenue- MS# 52 ERN P.O. Box Bo 341441 Hartford, CT 06134-1441

Regional Administrator, Region I U.S. Nuclear Regulatory Commission 2100 Renaissance Boulevard Renaissance Park

King of Prussia, PA 19406

Edward L. Wilds, Jr., PhD. Director

Radiation Division, Bureau of Air Management Connecticut Department of Energy and Environmental Protection 79 Elm Street

Hartford, CT 06106-5127

Board of Selectmen Town Office Building Haddam, CT 06438

Ms. Rosemary Bassilakis Citizens Awareness Network

54 Old Turnpike Road Haddam, CT 06438

Ms. Deborah B. Katz President Citizens Awareness Network P.O. Box 83 Shelburne Falls, MA 01370-0083

Mr. Randall L. Speck Kaye, Scholer, Fierman, Hayes & Handler,

LLP The McPherson Building 901 Fifteenth Street, NW Suite 1100 Washington, DC 20005-2327

Mr. Robert Capstick Communications Manager Connecticut Yankee Atomic Power

Company

77 Lakewood Road

Newton, MA 02461 Mr. Joseph Fay

General Counsel Connecticut Yankee Atomic Power

Company 362 Injun Hollow Road East Hampton, CT 06424-3099