ML12136A567

04/30/2012 Summary of Meeting with Constellation Energy to Discuss the Constellation Apparent Violation of NRC Regulations at Title 10 of the Code of Federal Regulations Part 50.9

ML12136A567
Person / Time
Site:	Calvert Cliffs, Nine Mile Point, Ginna
Issue date:	05/17/2012
From:	Simmons A Division of Inspection and Regional Support
To:	Christopher Regan Division of Inspection and Regional Support
Simmons A
Shared Package
ML12136A553	List: ML12136A567
References
EA-12-030
Download: ML12136A567 (7)

Text

May 17, 2012 MEMORANDUM TO: Christopher M. Regan, Chief Financial Analysis and International Projects Branch Division of Inspection and Regional Support Office of Nuclear Reactor Regulation FROM: Anneliese Simmons, Financial Analyst /RA/

Financial Analysis and International Projects Branch Division of Inspection and Regional Support Office of Nuclear Reactor Regulation

SUBJECT:

PRE-DECISIONAL ENFORCEMENT CONFERENCE MEETING

SUMMARY

On April 30, 2012, a Pre-decisional Enforcement Conference (PEC) was held with the Constellation Energy at the U.S. Nuclear Regulatory Commissions (NRCs) offices in Rockville, Maryland to discuss the Constellation apparent violation of NRC regulations at Title 10 of the Code of Federal Regulations Part 50.9. The Meeting Summary for the PEC is enclosed.

Docket No. 50-317/318; 50-244; 50-220/410

Enclosure:

As stated CONTACT: Anneliese Simmons, NRR/DIRS 301-415-6749

ML12136A553 (Pkg.); ML12136A553 (Memo); ML12128A023 (Attendees); ML12128A036 (NRC Slides); ML12128A037 (Constellation Slides)

OFFICE NRR/DIRS/IFIB NAME ASimmons DATE 5/17/2012

PREDECISIONAL ENFORCEMENT CONFERENCE

SUMMARY

Licensee: Constellation Energy Nuclear Group Facility: Calvert Cliffs, Nine Mile Point and Ginna Docket Number: 50-317/318; 50-244; 50-220/410 License Number: DPR-53/69; DPR-18; DPR-63/NPF-69 EA-12-030 On April 30, 2012, representatives of the Constellation Energy Nuclear Group met with U.S.

Nuclear Regulatory Commission (NRC) personnel at NRC Headquarters located in Rockville, Maryland to discuss the apparent violation identified in a letter to the Constellation dated April 3, 2012 (ML12089A097). The meeting was transcribed.

The identified apparent violation was that Constellation failed to provide complete and accurate information regarding changes made to documents referenced in the original license transfer application or required by statute, including foreign ownership, decommissioning funding assurance and financial qualifications. The changes made to these documents had an impact on the NRCs license transfer order to Constellation.

Regarding the changes made to the Operating Agreement relating to foreign ownership, the licensee agreed that they stated in their April 8, 2009, letter that no changes to Article VII of the Operating Agreement would be made. They agreed that the revised Operating Agreement contained new unanimous consent issues in Article VII. Additionally, the licensee stated that they would provide the NRC with any material changes. However, the licensee disagreed that the changes they made were material because even though the potential for control by EDF was there, the chairmans casting vote would override any EDF input on nuclear safety and security. Further, they stated that they had provided a weblink in their original application which would have allowed the staff to see the new agreements.

Regarding changes to financial documents and arrangements impacting financial qualifications, the licensee stated that they met all regulatory requirements. The licensee stated that there was a miscommunication with the staff. They did not intend to convey a position that the EDF merger would not be completed. They stated that as soon as they knew of the 8-day waiting period required for tax reasons, they told the staff immediately (within the hour) on October 13th.

The licensee also disagreed that the additional financial support of $45 million to ensure the financial qualifications of the Ginna facility was needed. Finally, the licensee stated at the panel that the potential gap in financial support of at least eight days was bounded by the original transfer order. However, the licensee acknowledged that the need for an 8 day wait was unusual.

Regarding decommissioning funding, the licensee stated that the changes to the Master Put Agreement, submitted to the SEC and the Maryland PSC, but not to the NRC, stating that Constellation would be solely responsible for any decommissioning funding shortfall was not material because Constellation never specified which method it would use to fund any shortfalls.

ENCLOSURE

Further, the licensee stated that they provided information consistent with other license transfer applications. The licensee provided three examples. The licensee referenced the Mid-American, FPL and Amergen transfers.

Correction to the record submitted by Constellation staff On May 1, 2012, Steve Miller, Senior Vice President and General Counsel submitted a correction to a statement made in the PEC. During the PEC, the NRC Staff indicated that on October 8, 2009, CENG had reviewed drafts of the orders and Safety Evaluation (SE) associated with our license transfer application.

At the conference, Miller acknowledged that CENG had been provided and reviewed the draft conditions of the orders on October 8, 2009, but he stated that CENG had not been provided the draft SE for review. According to the licensee, CENG did not research this point prior to the PEC.

Following the conference CENG determined that the NRC Project Manager did in fact provide a draft of the SE on October 8, 2009, to CENG for review, comment and corrections.

Although he corrected the misstatement made during the PEC, the licensee maintained that the misstatement did not change the substance of its presentation or responses to NRC questions.

Further, the licensee stated that even if CENGs tax expert had reviewed the document, it would not have alerted him that a possible delay between certain closing steps that created the regulatory concern for the NRC.

Miller also stated that CENG was withdrawing its request that its August 27, 2010, to the NRC no longer needed 10 CFR 2.390 protection. The letter was written to the NRC Office of Investigations at the beginning of the OI investigation into willfulness on the part of CENG and outlines CENGs position regarding the alleged violations.

The meeting attendee list, the NRCs presentation, and Constellations presentation and supporting materials are attached to this summary.

In accordance with 10 CFR 2.390 of the NRCs Rules of Practice, a copy of this summary and its enclosures will be made available to the Public.

Enclosures:

1. Attendee list

2. NRC Presentation

3. Constellation Presentation

Enclosure 1 Attendees List Meeting Summary of the 04/30/2012 Meeting with NRC/Constellation Energy Dated: May 17, 2012

Enclosure 2 NRC Presentation Slides Meeting Summary of the 04/30/2012 Meeting with NRC/Constellation Energy Dated: May 17, 2012

Enclosure 3 Constellation Presentation Slides Meeting Summary of the 04/30/2012 Meeting with NRC/ Constellation Energy Dated: May 17, 2012