NOC-AE-07002210, Request for Exemption from 10 CFR 50.82(a)(8)

Request for Exemption from 10 CFR 50.82(a)(8)

ML072750459
Person / Time
Site:	South Texas
Issue date:	09/19/2007
From:	Sheppard J South Texas
To:	Document Control Desk, Office of Nuclear Reactor Regulation
References
NOC-AE-07002210, STI: 32205487
Download: ML072750459 (74)

Text

Nuclear Operating Company South Texas Promed Electric GeneratingStation PO. Box 289 Wadsworth, Texas 77483 AA A September 19, 2007 NOC-AE-0700221 0 File No.: G25 10 CFR 50.82 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 and STN 50-499 Request for Exemption from 10 CFR 50.82(a)(8)

Pursuant to 10 CFR 50.12, STP Nuclear Operating Company (STPNOC), acting on behalf of NRG South Texas LP (NRG South Texas), the City Public Service Board of San Antonio (CPS) and the City of Austin, Texas (Austin Energy) (together, the "STP Owners"), hereby requests an exemption from Nuclear Regulatory Commission (NRC) regulations to permit the immediate withdrawal of certain funds from the nuclear decommissioning trust funds (NDTs) maintained by the STP Owners for South Texas Project Electric Generating Station Units 1 and 2 (the "Facility"). Specifically, the STP Owners request an exemption from provisions of 10 CFR 50.82(a)(8)(i) and (ii) which may restrict the withdrawal of funds from NDTs until after permanent plant shutdown.

The purpose of this exemption request is to permit the use of NDT funds, not to exceed

$20 million per unit, in order to pay for the prompt disposal of certain major radioactive components (MRCs). These MRCs are the reactor pressure vessel (RPV) heads to be removed from the Facility in the upcoming Fall 2009 Unit 1 outage and the Spring 2010 Unit 2 outage, as well as the steam generators that were removed from the Facility in 2000 and 2002.

If an exemption cannot be granted by July 1, 2008, to permit the use of NDTs for the immediate permanent disposal of the Unit 1 RPV head, STPNOC will need to initiate contracts to plan, design and construct a mausoleum for on-site RPV head storage at a projected cost of

$1.4 million. This cost, as well as the cost of ongoing maintenance and eventual decommissioning of the mausoleum, would be avoided altogether if NDT funds can be used to fund disposal of the RPV heads upon removal in 2009 and 2010.

The cost of disposal of these MRCs is included in the site-specific decommissioning cost estimates for the Facility, and funds are being accumulated in the NDTs to cover these costs. If approved, this exemption will facilitate the prompt removal of radiologically contaminated material from the Facility, reduce overall decommissioning costs, and reduce unnecessary regulatory burdens on the STP Owners associated with maintaining the MRCs on-site.

As described more fully in the attachment, the STP Owners collect funds in their NDTs through rates established by their City rate-setting authorities or by the Public Utility Commission of Texas (PUCT) for the purpose of decommissioning the Facility, including MRC disposal. The ST,: 32205487 /,Z 0 0/

NOC-AE-0700221 0 Page 2 of 4 rate-setting authorities do not set any limitation on the timing of decommissioning activities and use of funds for such expenditures, but NRC regulations appear to restrict the use of such commingled funds prior to permanent shutdown of the plant. The requested exemption would provide clear authorization for the STP Owners to use NDT funds for prompt disposal of MRCs prior to permanent plant shutdown.

STPNOC requests that the NRC grant the exemption because:

• The exemption is "authorized by law, will not present an undue risk to the public health and safety, and [is] consistent with the common defense and security," in accordance with 10 CFR 50.12(a)(1), and

" Special circumstances are present that satisfy 10 CFR 50.12(a)(2).

STPNOC demonstrates in the attachment that the request satisfies these provisions.

Granting this exemption will be consistent with the NRC decommissioning regulations as it:

(1) would not foreclose release of the site for possible unrestricted use (in fact, it would enhance STPNOC's ability to achieve unrestricted release); (2) would not result in significant environmental impacts not previously reviewed by the NRC; and (3) would not undermine the existing and continuing reasonable assurance that adequate funds will be available for decommissioning. Disposal of the MRCs would facilitate eventual unrestricted release of the Facility, thus improving environmental conditions. In addition, authorizing prompt disposal would give STPNOC the ability to take advantage of cost effective disposal alternatives and thereby eliminate the uncertainty associated with the future cost and availability of disposal capacity. Prompt disposal of MRC source terms that otherwise would remain on-site until much later in time is prudent and consistent with the underlying purpose of the Commission's decommissioning regulations.

In sum, granting this request will facilitate the decommissioning process by removing the MRCs from the site so that: (1) the inventory of radioactive waste and associated source term at the site will be reduced; (2) the costs and inconveniences associated with maintaining the MRCs on-site will be avoided; (3) the overall cost to decommission the site will be reduced; (4) uncertainty regarding future disposal cost and capacity for these MRCs will be eliminated; and (5) assurance of adequate funds to decommission the reactors at the time the reactors cease operation will be maintained. Finally, assurance of the adequacy of the availability of funds for Facility decommissioning is supported by a site-specific decommissioning cost estimate and the associated funding program.

STPNOC recognizes that on May 29, 2007, EnergySolutions submitted a rulemaking petition to the NRC (RM 50-88) seeking to, amend the Commission's regulations to provide a process for NRC approval of the use of decommissioning trust funds for the disposal of MRCs by licensees for operating reactors. NRC provided Notice regarding this pending petition and an opportunity for public comment on August 21, 2007 (72 FR 46569).

STPNOC is submitting this exemption request now, because timely resolution of this issue is needed in order to support STPNOC's outage planning activities in mid-2008 for the Fall 2009 Unit 1 outage, which will include removal and replacement of the Unit's RPV head. STPNOC currently anticipates construction of onsite facilities to store the RPV heads from Units 1 and 2 unless the STP Owners' NDT funds may be used to pay for prompt disposal. NRC's consideration of the rulemaking petition is unlikely to be timed to Support STPNOC's schedule.

Accordingly, STPNOC respectfully requests a response from the NRC by July 1, 2008, in order to avoid the resource allocation and other expenses associated with the design and construction of a new storage facility for the RPV heads from Units 1 and 2, and continued onsite storage of

NOC-AE-0700221 0 Page 3 of 4 other MRCs (steam generators previously removed from Units 1 and 2), which would be avoided if NDT funds can be used for the prompt disposal of the MRCs.

This letter and attachment contain no new commitments.

If NRC requires additional information concerning this request, please contact Mr. Scott Head, STPNOC Licensing Manager, at (361) 972-7136.

J. J. Sheppard President & Chief Executive Officer

Enclosures:

1) Exemption Request

2) Decommissioning Cost Update for the South Texas Project Electric Generating Station - May 2004

NOC-AE-0700221 0 Page 4 of 4 cc:

(paper copy) (electronic copy)

Regional Administrator, Region IV A. H. Gutterman, Esq.

U.S. Nuclear Regulatory Commission Morgan, Lewis & Bockius LLP 611 Ryan Plaza Drive, Suite 400 Arlington, TX 76011-8064 Mohan C. Thadani U.S. Nuclear Regulatory Commission Mohan C. Thadani Thad Hill Senior Project Manager Steve Winn U.S. Nuclear Regulatory Commission Harry Holloway One White Flint North (MS 7 D1) Eddy Daniels 11555 Rockville Pike Marty Ryan Rockville, MD 20852 NRG South Texas LP Richard A. Ratliff J. J. Nesrsta Bureau of Radiation Control R. K. Temple Texas Department of State Health Services Ed Alarcon 1100 West 4 9 th Street Kevin Polio Austin, TX 78756-3189 City Public Service C. M. Canady C. Kirksey City of Austin City of Austin Electric Utility Department 721 Barton Springs Road Jon C. Wood Austin, TX 78704 Cox, Smith & Matthews Senior Resident Inspector U.S. Nuclear Regulatory Commission P.O. Box 289, Mail Code: MN116 Wadsworth, TX 77483

ENCLOSURE 1 EXEMPTION REQUEST STI: 32205487

ENCLOSURE 1 EXEMPTION REQUEST

Enclosure 1 NOC-AE-0700221 0 Page 1 of 13 SOUTH TEXAS PROJECT UNITS 1 AND 2 I. EXEMPTION REQUEST In accordance with the provisions of 10CFR 50.12, "Specific Exemptions," STP Nuclear Operating Company (STPNOC), acting on behalf of NRG South Texas LP (NRG South Texas),

the City Public Service Board of San Antonio (CPS) and the City of Austin, Texas (Austin Energy) (together, the "STP Owners"), requests that the Nuclear Regulatory Commission (NRC) grant an exemption from provisions of 10 CFR 50.82, 'Termination of License." Specifically, the STP Owners request an exemption from the requirements of 10 CFR 50.82(a)(8)(i) and (ii), to the extent required in order to permit the immediate withdrawal of funds from the nuclear decommissioning trust funds (NDTs) maintained by the STP Owners for South Texas Project Electric Generating Station, Units 1 and 2 (the "Facility" or "STP") to cover the cost of disposal of certain contaminated large components prior to the permanent cessation of operations.

The purpose of this exemption request is to permit the use of NDT funds, up to $20 million per unit, in order to pay for the prompt disposal of the following major radioactive components (MRCs): the reactor pressure vessel (RPV) heads to be removed from the Facility in 2009 and 2010 and the eight steam generators that were removed from Facility in 2000 and 2002.

Prompt disposal will result in several benefits, as follows: (1) the inventory of radioactive waste and associated source term at the site will be reduced; (2) the costs and inconveniences associated with maintaining the MRCs on-site will be avoided; (3) the overall cost to decommission the site will be reduced; (4) uncertainty regarding future disposal cost and capacity for these MRCs will be eliminated; and (5) assurance of adequate funds to decommission the reactors at the time the reactors cease operation will be maintained. Finally, assurance of the adequacy of the availability of funds for Facility decommissioning is supported by a site-specific decommissioning cost estimate and the associated'funding program.

Authorization of the use of NDT funds for prompt disposal of the MRCs is in the public interest, because it will immediately reduce on-site waste inventories, eliminate risks associated with future disposal, and reduce the eventual cost and complexity of decommissioning the Facility.

Consequently, authorization to expend NDT funds for prompt disposal of the MRCs would further the purpose of 10 CFR 50.82(a)(8), which is to provide reasonable assurance that the decommissioning trust funds will be adequate to accomplish their intended purpose.

Ih. REQUIREMENTS The NRC regulations in 10 CFR 50.82(a)(8)(i) provide that decommissioning trust funds may be used by licensees if:

(A) The withdrawals are for expenses for legitimate decommissioning activities consistent with the definition of decommissioning in section 50.2; (B) The expenditure would not reduce the value of the decommissioning fund below an amount necessary to place and maintain the reactor in a safe storage condition if unforeseen conditions or expenses arise; and (C) The withdrawals would not inhibit the ability of the licensee to complete funding of any shortfalls in the decommissioning trust needed to ensure the availability of funds to ultimately release the site and terminate the license.

NRC has further conditioned the withdrawal of decommissioning trust funds by limiting the withdrawal rate from the trust. Section 50.82(a)(8)(ii) provides:

Enclosure 1 NOC-AE-0700221 0 Page 2 of 13 Initially, 3 percent of the generic amount specified in § 50.75 may be used for decommissioning planning. For licensees that have submitted the certifications required under § 50.82(a)(1) and commencing 90 days after the NRC has received the [post-shutdown decommissioning activities report] PSDAR, an additional 20 percent may be used. A site-specific decommissioning cost estimate must be submitted to the NRC prior to the licensee using any funding in excess of these amounts.

Section 50.82 refers to the definition of "decommissioning" in section 50.2, which defines the term "decommission" rather than "decommissioning." By that definition, the term "decommission" means:

to remove a facility or site safely from service and reduce residual radioactivity to a level that permits (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.

These provisions restrict the ability of the STP Owners to use NDT funds for the disposal of MRCs, even though removal of the MRCs would reduce the level of radioactivity at the STP site and would not adversely impact the ability to fund future decommissioning.

A request for an exemption from these requirements must satisfy the requirements of 10 CFR 50.12. As demonstrated below, this exemption request satisfies the provisions of section 50.12.

III. BACKGROUND In the Statements of Consideration for the 1996 amendments to 10 CFR 50.82, NRC stated in response to a comment as follows:

The NRC has concluded that allowing decommissioning trust funds withdrawals for disposals by nuclear power plants that continue to operate is not warranted.

These activities are more appropriately considered operating activities and should be financed that way.

(61 FR 39278, 39293).

Consequently, licensees have been precluded from using decommissioning trust funds for prompt disposal of radioactive waste, including MRCs that are prematurely removed from service! and effectively "decommissioned." The estimated cost of disposal of MRCs is very substantial and is specifically addressed in plant-specific decommissioning cost estimates.

Unlike other waste routinely generated during normal plant operations, replacement of MRCs is not an anticipated operating activity, but rather these MRCs were originally expected to remain in service throughout the life of the plant. As it has become necessary to replace MRCs, STPNOC has stored them on-site rather than expend funds from limited annual budgets to pay for near-term permanent disposal. STPNOC understands that such on-site storage is a common practice in the industry, and that of the approximately 200 steam generators that have been removed or are planned to be removed from reactors in the United States, about 150 are stored on-site, or are planned to be stored, in specially constructed mausoleums.

Significantly, NRC's rules do not address the reality that MRCs need to be removed from service during plant operating life. For example, the definition of "major decommissioning activities" in 10CFR50.2 includes removal of "major radioactive components," which specifically includes reactor vessels and steam generators. In fact, 10CFR50.82(a)(5) contemplates that "major decommissioning activities," i.e., removal of MRCs, would not be performed by licensees until after permanent cessation of operations. This regulatory scheme

Enclosure 1 NOC-AE-0700221 0 Page 3 of 13 implicitly acknowledges that removal and disposal of MRCs such as steam generators and RPV heads is not a routine operational activity, but rather is a decommissioning activity. Further support for this conclusion is found in the 1996 rulemaking history where NRC stated that removal and disposal of some "large components" would be considered "routine operations," but specifically excluded from such routine operations the removal of any large components that fall within the definition of "major radioactive componenf' (61 FR 39286). In fact, the response to comments made clear that a definition of "major radioactive component" was added for this very purpose, i.e., to distinguish the removal and disposal of certain equipment during normal operations from the removal of components such as steam generators and RPVs that would constitute "major decommissioning activity" per se.

STPNOC and the STP Owners have elected to improve plant operations and long term performance by replacing the specified MRCs with components made of improved materials.

The eight original steam generators were removed from the Facility in 2000 and 2002, and they are now stored on-site in a storage facility specifically constructed for that purpose. STPNOC estimates that its ongoing cost to maintain this storage facility is approximately $10,000 per year. Moreover, since the time when this storage facility was first planned and constructed, STPNOC has developed plans for the construction of two additional units at the STP site, and it is preparing an application for licenses to construct and operate those new units. The old steam generator storage facility is adjacent to the planned location of the new units, and occupies space that would otherwise be used for construction activities. For example, this land could be used as a convenient lay down area to support on-site construction activities.

There are significant advantages to disposing of the MRCs now rather than waiting until the cessation of operations and complete decommissioning of the plant. STPNOC is planning RPV head improvements to STP Units 1 and 2 that will result in the replacement of the existing RPV head from STP Unit 1 in a planned Fall 2009 outage and replacement of the existing RPV head from STP Unit 2 in a planned Spring 2010 outage. If the STP Owners are unable to use NDT funds to pay approximately $4.5 million for the near-term permanent disposal of these RPV heads, the STP Owners will instead use funds from the STP annual budget to plan, design and construct a new storage facility for the RPV heads, at a cost of approximately $1.4 million. This expenditure will not reduce the future cost of permanent disposal, but rather will simply defer the

$4.5 million expense until NDT funds can be accessed to pay for it. However, the $1.4 million for the RPV head mausoleum, as well as the eventual cost to then decommission it, could be avoided altogether if the STP Owners could access existing NDT funds to pay for permanent disposal upon their replacement.

Moreover, STPNOC has an opportunity to enter into favorable contractual arrangements for disposal of the existing steam generators, eliminating risks associated with future changes in disposal cost and/or availability of disposal capacity. The cost of disposal of the old steam generators was estimated to exceed $35 million in 2004, but STPNOC now projects that it can be accomplished in 2008 for less than $31 million.

In addition, prompt disposal will eliminate the need for ongoing maintenance of the existing storage facility, allowing its removal to make more room for construction activities. It also would reduce the on-site inventory of waste.

By using NDT funds to pay for prompt disposal, the STP Owners will be paying in current dollars to eliminate this future cost of decommissioning, and they will forgo future earnings on these funds. However, the loss of the benefit of future earnings is off-set by the elimination of future risk and uncertainty relating to the cost and availability of disposal capacity, as well as the benefits of eliminating the burdens associated with on-site storage and reducing the on-site

Enclosure 1 NOC-AE-0700221 0 Page 4 of 13 inventory of waste. Moreover, the remaining funds and planned ratepayer contributions will be sufficient to fully decommission the site consistent with the activities planned in the site-specific estimate.

IV. BASIS The permanent disposal of an MRC is a decommissioning activity, because such disposal involves the removal from service of a "major radioactive component," which is a large item of capital equipment. However, the NRC definition of "decommission" implies that an entire reactor facility must be removed from service before related activities fall within NRC-sanctioned decommissioning (10 CFR 50.2). Further, when the NRC promulgated the decommissioning rule in 1988, it noted in the Statements of Consideration to the final rule that "[d]ecommissioning activities are initiated when a licensee decides to terminate licensed activities" (53 FR 24,018, 24,019). If this exemption is granted, the MRCs will be disposed by STPNOC during plant operation rather than waiting until the entire site is being decommissioned. The cost of disposal would be paid from NDT funds placed there for the purpose of disposing of just such components.

The MRCs at issue here have been or will be removed from service well in advance of the rest of the Facility. Absent this exemption, the MRCs would remain on-site until the facility ceases operation. Accordingly, an exemption with respect to 10 CFR 50.82(a)(8)(i)(A) is needed because the Facility and site are not being removed from service, and therefore, payment for MRC disposal falls outside the definition "decommissioning activity" as the NRC Staff has interpreted 10 CFR 50.82(a)(8)(i)(A). It should be noted, however, that the regulations and this interpretation appear to be internally inconsistent, because 10 CFR 50.2 also provides that the permanent removal of "major radioactive components" is a "major decommissioning activity" and steam generators and RPVs are included as examples in the definition of "major radioactive component."

An exemption also is needed because section 50.82(a)(8)(ii) provides only for planning costs to be paid from decommissioning trust funds in advance of submittal of a PSDAR, implying that no other pre-PSDAR decommissioning costs are allowed. The expenditures for which the exemptions are being requested are not planning activities. Rather, they are necessary to remove the MRCs from the plant site and dispose of them, and the exemption request is to permit the funds necessary for that purpose to be withdrawn from the NDTs to fund current disposal activities irrespective of the 10 CFR 50.82(a)(8)(ii) restrictions.

A. Facility Decommissioning Trust Fund

1. Status of the Decommissioning Trust Fund The NDTs maintained by the STP Owners are currently very robustly funded and fully meet NRC's decommissioning financial assurance requirements. As reflected in STPNOC's decommissioning funding status report dated March 27, 2007, and submitted to NRC in accordance with 10 CFR 50.75(f), the minimum decommissioning fund estimate required for the South Texas Project, Units 1 and 2 based on the NRC formula in 10CFR50.75 is approximately $365.5 million per unit. The reported NDT balances as of December 31, 2006 totaled $364.9 million for Unit 1 and $445.8 million for Unit 2, for a total of $810.7 million. Thus, with projected earnings taken into account as permitted by NRC's rules, the NDT balances already substantially exceed NRC minimum requirements and are sufficient to be considered fully "pre-paid" for purposes of compliance with 10 CFR 50.75(e)(1)(i).

Moreover, the STP Owners continue to make periodic contributions to their NDTs, and under Texas law, ongoing ratepayer contributions will be made so that decommissioning funding will

Enclosure 1 NOC-AE-0700221 0 Page 5 of 13 be fully assured. The rates of collection are reviewed by the rate-setting authorities from time-to-time to assure that the rates of collections are adequate and appropriate to provide sufficient funds for decommissioning. These reviews are based on site-specific cost estimates that are maintained by the STP Owners, and regularly updated. At current rates of collection and contribution, the annual amounts remaining to be collected total $220.2 million for Unit 1 and

$215.8 million for Unit 2, or $436 million.

Notably, the General Accounting Office (GAO) recently analyzed the adequacy of funds for each reactor site to address concerns about the adequacy of the amounts of decommissioning funds that various reactor licensees have and are collecting. GAO concluded that 33 owners had accumulated fewer funds than needed and 20 owners were not contributing enough for them to meet their decommissioning fund goals. In the case of the South Texas Project, however, GAO found no such problem. STP's fund balances and contributions exceeded the benchmarks used by GAO by 50%.1

2. Site-Specific Decommissioning Cost Estimate Is Comprehensive The NRC requires in 10CFR50.75(f)(2) that each licensee prepare and submit a Decommissioning Cost Estimate (DCE) at least five years prior to the projected end of operations. As noted above, however, even though operations are projected to continue for at least,20 years, the STP Owners already have a detailed DCE. The most recent DCE update, which was done in 2004, resulted in a total estimated cost, including spent fuel storage and Greenfield costs, of $1.419 billion: $642 million for Unit 1 and $777 million for Unit 2. Of this total cost, $1.026 billion is attributed to license termination with $501 million for Unit 1 and

$525 million for Unit 2. All costs are in 2004 dollars.

The current site-specific estimates reflect the significant industry experience with the conduct of decommissioning as of 2004. By that time, there were several commercial nuclear power plants undergoing decommissioning, including Maine Yankee, Connecticut Yankee, Yankee Rowe, Trojan, and Big Rock Point. These projects were building on the lessons learned from other completed decommissioning projects such as Elk River and Shippingport. This experience included some generally acknowledged missteps made in the beginning stages of the current projects that led to additional costs beyond what had been projected. By 2004 these problems had been resolved, the projects were proceeding rapidly toward license termination, and the causes of the early-stage problems were well understood.

The STP cost estimates take into account the industry lessons learned. For example, the 2004 update includes an improved Greater than Class C (GTCC) segmentation analysis, reducing the assumed volume of this waste. It also assumes that the reactor vessel and reactor vessel internals would be removed by an outside contractor, which is consistent with current decommissioning practices.

The STP cost estimates take into account site-specific parameters that affect the total cost.

These parameters include site-specific equipment and material inventories, STPNOC staffing costs, projected spent fuel inventories, and site-specific spent fuel storage and shipping schedules. The end result is a site-specific decommissioning cost estimate in which STPNOC has a high degree of confidence.

Nuclear Regulation: NRC Needs More Effective Analysis to Ensure Accumulation of Funds to Decommission Nuclear Power Plants, GAO-04-032, at 34-35 (October 2003)

Enclosure 1 NOC-AE-0700221 0 Page 6 of 13

3. The Site-Specific Decommissioning Cost Estimate Is Reliable As discussed above, the DCE contains a thorough and comprehensive analysis of the costs of decommissioning. The reliability of current industry DCEs is demonstrated by recent decommissioning experience. Data for the three large PWRs that have been fully demolished (Connecticut Yankee, Maine Yankee, and Trojan) show that final decommissioning costs were less than projected in the DCE for two (Maine Yankee and Trojan) and 24% higher for one (Connecticut Yankee). Despite the Connecticut Yankee experience, a table top review of the data indicates that the DCEs are reliable planning tools. 2 Furthermore, the cause of the difference in the case of Connecticut Yankee is now well understood, as explained below.

Both Maine Yankee and Connecticut Yankee started the decommissioning process after an unplanned shutdown. Maine Yankee shut down in December of 1996 and made the decision to decommission in August of 1997. Maine Yankee decided on a Decommissioning Operations Contractor (DOC) approach, with a DOC selected in August of 1998, approximately 20 months after shutdown. Connecticut Yankee shut down in December of 1996 after the decision was made to decommission. Connecticut Yankee also elected to utilize a DOC approach, selecting a DOC in April 1999, more than two years after shutdown.

Connecticut Yankee experienced problems with the selected DOC, and terminated the contract in 2003. These management problems significantly increased the decommissioning costs, resulting in an actual cost some 24 percent higher than the Connecticut Yankee DCE. While management problems also could cause future decommissioning costs to be unnecessarily high, it is likely that such significant problems will be avoided.

The experience of Maine Yankee shows that the cost associated with the type of problems experienced by Connecticut Yankee can be adequately mitigated if they occur in future decommissioning projects. Maine Yankee also had problems with its selected DOC and decided to terminate its contract. Maine Yankee, however, acted more quickly than Connecticut Yankee. While Connecticut Yankee terminated its DOC contract four years after DOC selection, Maine Yankee did so after only two years. As a result, Maine Yankee was able to quickly return its decommissioning project to schedule and budget and complete decommissioning within the DCE. The Maine Yankee experience shows that significant management problems can be overcome if promptly recognized and addressed.

The industry experience with decommissioning plants over the last decade contributes significantly to the reliability of current industry DCEs and provides a knowledge base that will result in more cost-efficient decommissioning in the future. Future decommissioning projects will be able to avoid mistakes and reduce costs through lessons-learned. Since the STP units have longer projected operating lives than most currently operating plants, it is likely to benefit from the decommissioning experiences of dozens of much older plants that will be decommissioned during the remaining operating lives of the STP units. The predictable result will be further lessons learned and opportunities for more efficiency.

4. Decommissioning Trust Fund Addresses the Removal of the MRCs The existing STP decommissioning cost estimates include not only the radiological cleanup required by the NRC, but also the costs of dismantling the facilities and restoring the site as 2 Table Top Review - DecommissioningCosts for Power Reactors, CAF and Associates, April 2007.

Enclosure 1 NOC-AE-0700221 0 Page 7 of 13 closely as possible to its natural state.3 The estimate also includes funds intended for ultimate storage and monitoring of spent nuclear fuel remaining on-site following shutdown in the event the U.S. Department of Energy has not fulfilled its obligation to take custody of the spent fuel.

Further, the most recent cost estimate, on which current fund collections are based, specifically includes the cost of disposal of the old steam generators currently stored on-site.

The DCE line item cost to remove, pack, ship and dispose of the old steam generators is

$17.587 million for Unit 1 (2004 Cost Study, Appendix A, page 4 of 19, Table A-i, Line 27.'6) and $17.587 million for Unit 2 (2004 Cost Study, Appendix A, page 13 of 19, Table A-2, Line 27.6), in 2004 dollars. There is also a line item cost of $305,000 to remove the steam generator mausoleum (2004 Cost Study, Appendix A, page 18 of 19, Table A-2, Line 35.15), also in 2004 dollars. Thus, the total cost for these activities was estimated (in 2004 dollars) to exceed

$35.5 million. In contrast, STPNOC now has the opportunity to complete these activities for less than $31 million (in 2008 dollars).

B. Withdrawal of Funds Now From the Decommissioning Trust Fund Will Not Jeopardize STPNOC's Ability to Fully Decommission the Facility

1. There Will Be Sufficient Funds Available To Decommission Facility As noted above, NDT balances for Units 1 and 2 reported for the end of 2006 were approximately $365 and $446 million, respectively. If these balances were reduced by

$20 million from the NDTs for each Unit in order to fund MRC disposal activities, the remaining Unit 2 balance of $426 million would continue to exceed the NRC minimum "formula" amount of

$365.5 million. The Unit 1 balance of $345 million would exceed the NRC minimum, if earnings were taken into account for just three years assuming a 2 percent real rate of return as specified in 10 CFR 50.75(e)(1)(ii). With just three years worth of earnings, the Unit 1 NDT value would exceed $365.5 million. As such, even after the withdrawal of funds to pay for MRC disposal, the NDT balances are sufficient to be considered fully prepaid for purposes of meeting NRC's requirements to provide financial assurance for decommissioning, in accordance with 10 CFR 50.75(e)(1)(i) (prepayment method).

In addition to fully meeting NRC's requirements when the NDT balances are compared to the NRC "formula" amount for the STP units, the STP Owners continue to make annual contributions to the NDTs. In establishing the amounts of their annual contributions, the STP owners assess the NDT balances against not only the NRC minimum, but also against the site-specific decommissioning cost estimates for STP Units 1 and 2. When necessary, the need for adjustment to the rate of collections is reviewed with the rate-making authorities, such as the Public Utility Commission of Texas (PUCT).

The total 2004 site-specific estimates for Units 1 and 2 are $642.2 million and $777.3 million, respectively, including nearly $17.6 million in each estimate for the disposal of the old steam generators, and $0.3 million in the Unit 2 estimate for demolition of the mausoleum. If credit were taken for earnings assuming a 2 percent real rate of return for all NDT funds for 20 and 21 years respectively, based upon the end of 2006 balances reduced by $20 million each to pay for current disposal ($345 million and $426 million), the "value" of these current balances for Units 1 and 2 would exceed $510 million and $645 million, respectively. Taking into consideration the currently planned future contributions to each unit's funds of $220.2 and $215.8 million, respectively, there is clearly reasonable assurance that the NDTs will be sufficient to fund the Because the relevant orders by the State Commissions do not yet specifically allocate collections among the types of decommissioning costs, the funds for all decommissioning purposes currently are commingled in the trust, including those for NRC-jurisdictional radiological decommissioning.

Enclosure 1 NOC-AE-0700221 0 Page 8 of 13 decommissioning activities contemplated by the site-specific estimate, after the requested withdrawals of $20 million from each unit's NDTs are made over the next few years.

2. The Withdrawal Will Not Reduce the Value of the Decommissioning Fund Below an Amount Necessary to Place and Maintain the Reactor in a Safe Storage Condition If Unforeseen Conditions or Expenses Arise The use of NDT funds for the requested purpose will not reduce the value of the NDTs below an amount necessary to place and maintain the reactors in a safe storage condition. As discussed in Section IV.B.1 above, the remaining NDT balances (after withdrawals of up to $20 million per unit were made) would continue to exceed the NRC minimum requirements for financial assurance for decommissioning. Thus, the NDT balances would remain sufficient to be considered "fully funded" for purposes of compliance with NRC's rules.

Moreover, the STP Owners will continue to make annual contributions to the their NDTs, so that it is projected that the NDTs will be sufficient to fund the entire site-specific decommissioning cost estimate at the end of plant life, when the additional contributions and assumed earnings are taken into account.

Thus, even with the requested withdrawals, the STP Owners not only have sufficient funds to place and maintain the reactor in a safe storage. condition, but the STP Owners also have sufficient funds to complete the NRC-required radiological decommissioning based on its site-specific decommissioning cost estimate, as well as other planned decommissioning activities.

3. Decommissioning Funding for STP Units 1 and 2 Is Assured Even in the Event of Any Shortfall in Available Funds The current status of NDT funding and program of continued contributions provide reasonable assurance that the NDT funds will continue to be adequate to fund decommissioning after the requested withdrawals are made. Even if this analysis were incorrect, NRC can further rely on the fact that the STP Owners will be able to obtain the funds necessary to complete decommissioning, even if there were a shortfall.

The STP Owners have the ability to collect additional funds from the ratepayers, if the NDT balances became inadequate. CPS and Austin Energy are governmental entities that have the ability to set rates and collect funds for decommissioning from their ratepayers. With respect to the legacy interests in STP Units 1 and 2 originally licensed to Houston Lighting & Power Company (30.8%) and Central Power and Light (25.2%), Texas law provides that CPS and NRG South Texas can seek collection of funds from Texas retail customers for the decommissioning liability for these interests pursuant to "cost of service" ratemaking. Section 39.205 of the Texas Utilities Code provides that, after January 1, 2002, costs associated with nuclear decommissioning obligations for the existing nuclear plants shall continue to be subject to cost-of-service rate regulation and will be included as a non-bypassable charge to retail 4

customers. .

On October 6, 2004, the PUCT issued a final order adopting new Substantive Rule section 25.303. The new rule codifies the continuing responsibility of the electric transmission and distribution companies whose predecessors owned nuclear power plants prior to the restructuring of the Texas electricity industry, to collect funds necessary for the decommissioning of those facilities for the benefit of the transferee company. The rule provides that the annual decommissioning costs must be stated as a separate non-bypassable charge in the individual transmission and distribution company's rates, and provides for the periodic adjustment of the non-bypassable charge based on the most current estimate of the costs of decommissioning the

Enclosure 1 NOC-AE-0700221 0 Page 9 of 13 V. JUSTIFICATION OF EXEMPTION AND SPECIAL CIRCUMSTANCES 10 CFR 50.12, "Specific Exemptions," states that the NRC may grant exemptions from the requirements of the regulations in 10 CFR Part 50 if three conditions are met. The three conditions are: (1) the exemption is authorized by law; (2) the exemption will not present an undue risk to the public health and safety; and (3) the exemption is consistent with the common defense and security. In addition, 10 CFR 50.12 provides that the NRC will not consider granting an exemption unless special circumstances are present.

A. The Requested Exemption is Authorized by Law The NRC has the authority under the Atomic Energy Act to grant exemptions from its regulations if doing so would not violate the requirements of law. This exemption is authorized by law as is required by 10 CFR 50.12(a)(1). No law exists that precludes the activities covered by this exemption request. The provisions of 10 CFR 50.82 were adopted at the discretion of the Commission consistent with its statutory authority. No statute required the NRC to adopt the specific provisions from which STP seeks an exemption. Rather, the NRC may determine that alternative means are adequate to provide reasonable assurance of safety.

B. The Requested Exemption Will Not Present an Undue Risk to the Public Health and Safety This exemption will not present an undue risk to the public health and safety. To the contrary, granting this exemption will result in increasing the protection to the public health and safety as multiple source terms will be removed from the site and properly disposed of decades in advance of the time the MRCs would be removed if they were stored on-site until the reactor ceases operation. This will provide for permanent disposal of the MRCs and eliminate any risk of future exposures from these sources at STP. Moreover, ample decommissioning funding assurance will continue to be provided after withdrawals are made to pay for the near-term MRC disposal activity.

C. The Requested Exemption is Consistent with the Common Defense and Security This exemption is consistent with the common defense and security because the use of NDT funds to dispose of the MRCs will have no effect on the physical security of the site or the protection of special nuclear material from theft. Moreover, to the extent that residual radioactivity in the MRCs maintained in storage represents any potential threat, near-term permanent disposal enhances security.

D. Special Circumstances This exemption is justified based on five of the six special circumstances enumerated in 10 CFR 50.12(a)(2):

1. Application of the regulation in the particular circumstances would not serve the underlying purpose of the rule or is not necessary to achieve the underlying purpose of the rule. (10 CFR 50.12(a)(2)(ii))

The underlying purpose of the rule is to provide assurance that there will be adequate funds for the ultimate decommissioning of the site. The application of the regulation restricts the nuclear plant in question. Order Adopting New Section 25.303 as Approved at the September 30, 2004 Open Meeting, Project No. 29169 (October 6, 2004). Thus, the PUCT has issued implementing regulations to provide for the ongoing funding of decommissioning by ratepayers as required under Texas law.

Enclosure 1 NOC-AE-0700221 0 Page 10 of 13 expenditure of decommissioning trust funds in this circumstance, which is unnecessary to achieve the underlying purpose of the rule. The purpose of the restrictions on fund withdrawal is to protect the heath and safety of the public by assuring that there will be adequate funds available to complete NRC-required decommissioning activities following termination of the operating license. The above analysis in Section IV of the site-specific decommissioning cost estimate and the status of the NDTs demonstrates that funding will be adequate to complete decommissioning even iffunds are withdrawn for early disposal of the MRCs.

This conclusion is further supported by the fact that the NRC regulations recognize that a site-specific decommissioning cost estimate provides a reasonable basis for not restricting licensee expenditure of decommissioning funds. Under 10 CFR 50.82(a)(8)(ii), after a licensee ceases operations, its expenditure of decommissioning funds is restricted until it has submitted a site-specific decommissioning cost estimate. Once this cost estimate is provided to the NRC, a licensee may withdraw unlimited funds without obtaining prior NRC approval. This interpretation of the regulation was specifically stated in the 1996 Statements of Consideration (61 FR 39285): ("Response. The NRC's intent in the proposed rule was not to use a formal approval mechanism for decommissioning expenditures once the licensee submits its site-specific decommissioning cost estimate. The final rule has been modified as suggested by the commenter."). Since STP's site-specific decommissioning cost estimate is being submitted with this exemption request, NRC has the information equivalent to that required by 10 CFR 50.82(a)(8)(ii).

The NRC's regulatory scheme relies in large part on the ability of licensees to effectively plan for

• and manage the decommissioning activity. The above discussion demonstrates that the STP

.Owners have an adequate basis upon which to make informed decisions regarding the effect and timing of activities and expenditure of funds. Further, it shows that they have a reasonable

,basis for determining that it is prudent from both a safety and economic sense to use NDT funds to dispose of these MRCs in the near-term, when permanent disposal can be accomplished on reasonable financial terms. In these circumstances, it is not necessary for NRC to prevent the licensees from exercising their sound business judgment regarding the timing of decommissioning expenditures.

2. Compliance would result in undue hardship or other costs that are significantly in excess of those contemplated when the regulation was adopted, or that are significantly in excess of those incurred by others similarly situated. (10 CFR 50.12(a)(2)(iii))

Compliance with the restrictions on the use of NDT funds presents an undue hardship on the STP Owners, because they will have to fund the planning, design and construction of an additional RPV head mausoleum, as well as eventual decommissioning of the mausoleum, that could otherwise be avoided. In addition, the STP Owners could avoid ongoing maintenance costs and other inconveniences from having to maintain storage facilities that would no longer need to exist, if the STP owners could use NDT funds to dispose of the MRCs. These are unnecessary regulatory burdens that were never contemplated when the regulation was adopted, because the rule never fully addressed the possibility of MRCs being removed during the operating life of the plant. For example, as discussed above in Section III, the definition of "major decommissioning activities" assumed to occur after permanent cessation of operations includes removal of MRCs.

STPNOC is planning on RPV head improvements to STP Units 1 and 2 that will result in the removal of the existing RPV head from STP Unit 1 in a planned Fall 2009 outage and removal of the existing RPV head from STP Unit 2 in a planned Spring 2010 outage. If the STP Owners

Enclosure 1 NOC-AE-0700221 0 Page 11 of 13 are unable to use NDT funds to pay approximately $4.5 million for the near-term permanent disposal of these RPV heads, the STP Owners will instead budget from operating funds to plan, design and construct a new storage facility for the RPV heads, at costs which are projected to exceed $1.4 million. This expenditure will not reduce the future cost of permanent disposal, but rather will simply defer the $4.5 million expense until NDT funds can be accessed to pay for it.

In addition to the burden of constructing this new RPV head mausoleum, the STP Owners will be burdened with ongoing annual maintenance costs for this new facility and the existing steam generator mausoleum, the nuisance of having these facilities on-site, and ultimately the need to plan for and fund the future demolition and decommissioning of these storage facilities, which is estimated to exceed $400,000 in 2007 dollars for both mausoleums.

All of the costs associated with the new RPV head mausoleum would be avoided if NDT funds collected for the purpose of funding MRC disposal could be used to dispose the RPV heads in 2009 and 2010. Moreover, additional costs and inconveniences associated with the steam generator mausoleum could also be avoided if NDT funds could be used for the near-term disposal of these MRCs. As noted above in section IV.B.1, use of NDT funds would not have an adverse impact of the ability to decommission the site to unrestricted use standards. In fact, plans and funding for future decommissioning would be enhanced by reducing future risks and uncertainties. Consequently, application of the rule without granting this exemption results in unnecessary and avoidable costs and burdens to the STP Owners and their ratepayers that were not anticipated when this rule was adopted.

3. The exemption would result in benefit to the public health and safety that compensates for any decrease in safety that may result from the grant of the exemption. (10 CFR 50.12(a)(2)(iv))

While STPNOC clearly is capable of maintaining protection of the public health and safety if the MRCs are stored on-site, the exemption would result in benefit to the public health and safety, because removal of the MRCs would provide a permanent disposal solution. This eliminates any potential future risk associated with on-site storage, even if such risk is low. Furthermore, there is no associated decrease in safety. Thus, allowing the exemption will result in a net benefit to the public health and safety.

Prompt disposal of these MRCs furthers the objective of maintaining radiation exposures as low as reasonably achievable pursuant to 10 CFR 20.1101(b) by eliminating the potential for any future exposure from storing waste on-site. In addition, disposing of waste prior to the permanent cessation of operations is consistent with NRC policy to minimize the costs and complexity of decommissioning, which can only improve safety.

4. There is present any other material circumstance not considered when the regulation was adopted for which it would be in the public interest to grant an exemption. (10 CFR 50.12(a)(2)(vi))

As promulgated, the rule has never required that site-specific decommissioning cost estimates be developed during the operating life of the plant, but instead assumed that such estimates would be developed around the time a plant ceases operation. See 10 CFR 50.75(f)(2). In the absence of site-specific information, there may be an understandable preference for preserving funds in the NDTs, because it would be difficult to make informed decisions regarding the sequencing of decommissioning activities and expenses. However, where detailed information is available, NRC and the licensees have the ability to evaluate the cost and benefits of prompt disposal versus deferring expenditures. This changed circumstance provides NRC with the ability to determine if there is reasonable assurance that sufficient funds will be available at the time of decommissioning if funds are withdrawn to cover the disposal costs for these MRCs.

Enclosure 1 NOC-AE-0700221 0 Page 12 of 13 The exemption request also satisfies the special circumstance criterion of 10 CFR 50.12(a)(2)(vi) in that, when this rule was adopted, the NRC did not consider that MRCs would be removed from the Facility long before permanent cessation of operation, and that the MRCs would be stored on-site because NDTs did not include sub-accounts to address disposal of large components.

NRC's rulemaking history makes clear that licensees may maintain sub-accounts in NDTs that might be used for purposes unrestricted by NRC, such as covering the disposal costs for MRCs.

In one example, American Electric Power Company set aside funds that were dedicated for disposal of steam generators from DC Cook. However, some state utility commissions do not favor the use of sub-accounts. In adopting the regulation, NRC anticipated that sub-accounts would be used to separate the funds collected for NRC-jurisdiction decommissioning from other decommissioning uses, and did not contemplate that funds collected for non-NRC decommissioning purposes would be commingled with the NRC-required decommissioning funds (61 FR 39285).

In this case, the funds for NRC-jurisdictional decommissioning and other decommissioning are commingled in the NDTs. NRC did not intend to prevent the use of those funds solely because they are commingled, and to do so would create an unnecessary regulatory burden as it does not have a corresponding safety benefit. This is especially true in the current situation where the adequacy of decommissioning funding can be assessed based upon a site-specific decommissioning cost estimate that sets out the costs for the different elements of decommissioning (including the disposal of MRCs) to determine whether there are adequate funds to fulfill NRC decommissioning requirements.

5. Application of the regulation in the particular circumstances conflicts with other rules or requirements of the commission.

(10 CFR 50.12(a)(2)(i))

Application of the regulations in 10 CFR 50.82(a) is in conflict with the NRC philosophy favoring the timely disposition of nuclear waste, under circumstances where doing so is practicable. For example, materials licensees of the NRC are subject to the 1994 Decommission Timeliness Rule, 10 CFR 30.36, 40.42, 70.38, and 72.54, which requires those licensees to decontaminate and decommission certain unused portions of operating nuclear materials facilities. Allowing contaminated land, buildings or equipment to remain on-site was seen as a possible public and environmental liability, and the NRC looked for ways to achieve early decommissioning of unused portions of materials facilities. For valid and sound reasons, reactor licensees are not subject to this rule and, in fact, are allowed the SAFSTOR option under 10 CFR 50.82.

Nevertheless, NRC should look favorably upon efforts to pursue near-term permanent disposal of MRCs where justified.

Another example of NRC's preference for minimizing the on-site inventory of waste is reflected in 10 CFR 20.1406 which was added along with modifications to NRC's license termination rule in 1997 (62 FR 39058). This regulation provides:

Applicants for licenses, other than renewals, after August 20, 1997, shall describe in the application how facility design and procedures for operation will minimize, to the extent practicable, contamination of the facility and the environment, facilitate eventual decommissioning, and minimize to the extent practicable, the generation of radioactive waste.

The intent of 10 CFR 20.1406 is to diminish the occurrence and severity of site contamination by taking measures that will control contamination and facilitate eventual decommissioning.

Consistent with this philosophy, early removal of large components is consistent with

Enclosure 1 NOC-AE-0700221 0 Page 13 of 13 10 CFR 20.1406. In contrast, storage of MRCs on-site until permanent cessation of operations will increase the complexity of decommissioning and volume of waste to be disposed at the end of plant life. Moreover, this complexity will be exacerbated by the inventory of MRCs stored on-site at multiple plants. Thus, permitting the phased disposal of large components over time will reduce the inventory of waste material and eliminate this future decommissioning activity, consistent with the philosophy underlying 10 CFR 20.1406.

Though not required to do so, reactor licensees should be permitted to utilize NDT funds to pay for the permanent disposal of MRCs prior to cessation of operations. This is justified where funds are being accumulated in NDTs and are available for this purpose, especially where early removal could take advantage of favorable disposal pricing. Unless the use of NDT funds is permitted, MRCs will likely remain on-site for additional decades, particularly given current trends towards license renewal.

Finally, delaying disposal introduces risks associated with potential changes in future disposal costs and availability of disposal capacity.

VI. CONCLUSION Granting this exemption will be consistent with the NRC decommissioning regulations as it:

(1) would not foreclose release of the site for possible unrestricted use (in fact, it would enhance STPNOC's ability to achieve unrestricted release); (2) would not result. in significant environmental impacts not previously reviewed by the NRC; and (3) would not. undermine the existing and continuing reasonable assurance that adequate funds will be available for decommissioning. Disposal of the MRCs would facilitate eventual unrestricted release of the Facility, thus improving environmental conditions. In addition, authorizing prompt disposal would give STPNOC the ability to take advantage of cost effective disposal alternatives and thereby eliminate the uncertainty associated with the future cost and availability of disposal capacity. Prompt disposal of MRC source terms that otherwise would remain on-site until much later in time is prudent and consistent with the underlying purpose of the Commission's decommissioning regulations.

It is prudent and consistent with the underlying purpose of the Decommission Timeliness Rule to remove large component source terms that otherwise would remain on-site till much later in time. In sum, it will facilitate the decommissioning process by removing the specified components from the site so that: (1) the inventory of radioactive waste and associated source term at the site will be reduced; (2) the costs and inconveniences associated with maintaining the MRCs on-site will be avoided; (3) the overall cost to decommission the site will be reduced; (4) uncertainty regarding future disposal cost and capacity for these MRCs will be eliminated; and (5) assurance of adequate funds to decommission the reactors at the time the reactors cease operation will be maintained. Finally, assurance of the adequacy of the availability of funds for Facility decommissioning is supported by a site-specific decommissioning cost estimate and the associated funding program.

ENCLOSURE 2 DECOMMISSIONING COST UPDATE for the SOUTH TEXAS PROJECT ELECTRIC GENERATING STATION May 2004

Document S30-1499-002, Rev. 0 DECOMMISSIONING COST UPDATE for the SOUTH TEXAS PROJECT ELECTRIC GENERATING STATION preparedfor STP Nuclear Operating Company preparedby TLG Services, Inc.

Bridgewater, Connecticut May 2004

South Texas ProjectElectric GeneratingStation Document S30-1499-002, Rev. 0 DecommissioningCost Update Page ii of vi APPROVALS Project Manager Geoffr'yýM. GrifAti~s Date S--' 2,4.6,ve Project Engineer Date Benjamin J. Stochmal Technical Manager Date William A. Cloutier Quality Assurance Manager Date (acting) Thomas S. La ardia, P.E.

TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499-002, Rev. 0 Decommissioning Cost Update Pageiii of vi TABLE OF CONTENTS PAGE DECOMMISSIONING COST STUDY LIMITED TECHNICAL AND ECONOMIC UPDATE ........................................................................................ vi

1. BASIS OF ESTIMATE UPDATE .................................................................. 1 1.1 Spent Fuel Disposition ........................................................................... 1 1.2 Utility, Doc and Security Staff ................................................................ 6 1.3 Waste Processing and Disposal Costs .................................................... 7 1.4 N RC Fees .................................................................................................. 8 1.5 Escalation of Other Costs ...................................................................... 9 1.6 Reactor Vessel Disposition Costs ......................................................... 10 1.7 Project Schedule .................................................................................... 11 1.8 Co-Owners Cost .................................................................................... 12 1.9 Other Estimating Assumptions ........................................................... 12

2. RESULTS ................................................................................................................ 13 TABLES 1.0 Spent Fuel Management Schedule - Ex-Core Fuel Assemblies .................. 14 2.0 Co-Owner Decommissioning Cost Allocations ............................................. 15 3.1 Schedule of Annual Expenditures DECON Alternative - Unit 1 ................ 16 3.2 Schedule of Annual Expenditures DECON Alternative (Certain Spent Fuel-Related Costs) - Unit 1 ................................................ 17 4.1 Schedule of Annual Expenditures DECON Alternative - Unit 2 ................ 18 4.2 Schedule of Annual Expenditures DECON Alternative (Certain Spent Fuel-Related Costs) - Unit 2 ................................................ 19 A-1 South Texas Project - Unit 1, DECON, Decommissioning Cost Estim ate .................................................................................................. A -2 A-2 South Texas Project - Unit 2, DECON, Decommissioning Cost E stim ate ............................................................................................ A -11 B-l.a Texas Genco, LP - Schedule of Annual Expenditures DECON Alternative-U nit 1 ........................................................................................... B -2 B-l.b Texas Genco, LP - Schedule of Annual Expenditures DECON Alternative-U nit 2 ............................................................................ B-3 B-2.a AEP Texas Central Co. - Schedule of Annual Expenditures DECON Alternative-U nit 1 ........................................................................................... B -4 TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document 830-1499-002, Rev. 0 DecommissioningCost Update Page iv of vi TABLE OF CONTENTS (continued)

PAGE B-2.b AEP Texas Central Co. - Schedule of Annual Expenditures DECON Alternative-U nit 2 ........................................................................................... B-5 B-3.a CPS - Schedule of Annual Expenditures DECON Alternative-Unit 1 ....... B-6 B-3.b CPS - Schedule of Annual Expenditures DECON Alternative-Unit 2 ......... B-7 B-4.a COA - Schedule of Annual Expenditures DECON Alternative-Unit 1 ........ B-8 B-4.b COA - Schedule of Annual Expenditures DECON Alternative-Unit 2 ........ B-9 FIGURES

1. Tim eline of Events ....................................................................................... 20 APPENDICES A. Decommissioning Cost Estimates DECON Alternative .............................. A-1 B. Co-Owner Schedule of Annual Expenditures DECON Alternative ....... B-1 TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499-002, Rev. 0 DecommissioningCost Update Page v of vi REVISION LOG F N.... J No. Dat6 i~oi**i Ie ItemRe!se*I[ *or Revisi'n 0 5/26/2004 Original Issue TLG Services, Inc.

South Texas ProjectElectricGeneratingStation Document 830-1499-002,Rev. 0 DecommissioningCost Update Page vi of vi DECOMMISSIONING COST STUDY LIMITED TECHNICAL AND ECONOMIC UPDATE This technical and economic update to the 1998 cost estimates prepared for decommissioning the South Texas Project Electric Generating Station (STPEGS or STP) incorporates changes in significant cost drivers that will impact the cost to decommission the station. The work is being done in accordance with the requirements of South Texas Project Nuclear Operating Company's (STPNOC) contract B02948 and extrapolates from the conclusions of the 1998 decommissioning cost study prepared for STPEGS (TLG Document H01-1323-002, Rev. 2). [Although that report was issued in 1999, the results were reported in 1998 dollars. That report will be referred to as the 1998 analysis.] The re-visited and updated cost drivers include:

0 Spent Fuel Management and Strategy a Program Management (includes Utility, Decommissioning Operations Contractor [DOC], and Security) 0 NRC Reactor and Independent Spent Fuel Storage Installation [ISFSI]

Fees

• Waste Processing and Disposal

• Reactor Vessel Disposition (includes Greater Than Class C (GTCC) disposal)

• Energy

• General Inflation The basis for the update, as well as the results, are d escribed in the following narrative.

TLG Services,Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499-002, Rev. 0 DecommissioningCost Update Page 1 of20

1. BASIS OF ESTIMATE UPDATE The cost estimate was developed by updating the economic inputs and spent fuel strategy from the decommissioning cost model used in preparing the 1998 STPEGS decommissioning cost study for the DECON scenario. Based on the recommendations in that study, and in TLG's current best judgment, DECON remains the preferred funding alternative for planning purposes. This estimate included updating the expected initiation of U.S. Department of Energy (DOE) spent fuel acceptance and acceptance rates, and incorporating industry experience associated with loading and transferring multi-purpose spent fuel canisters. This estimate also incorporated updated utility, security, DOC, and engineering staff costs based on current salary values, and staffing levels consistent with TLG's current estimating model (which incorporates industry experience over the past 5 years). In addition, this estimate updated waste disposal and waste processing costs based on current unit costs, revised U.S. Nuclear Regulatory Commissioning (NRC) fee costs based on published cost recovery schedules, and escalated all other costs (excluding property taxes) based on a general inflation index used in the NRC's 10CFR50.75(c) minimum funding calculation criteria.

The basis and assumptions used for each of the updated cost drivers are identified in sub-sections 1.1 through 1.9.

1.1 SPENT FUEL DISPOSITION The cost to dispose of the spent fuel generated from plant operations is not reflected within the estimates to decommission STPEGS. Ultimate disposition of the spent fuel is under the DOE's Waste Management System, as defined by the NWPA. DOE Spent Fuel disposal is financed by a 1 millfkWhr surcharge paid into the DOE's waste fund during operations. However, the NRC requires licensees to establish a program to manage and provide funding for the management of all irradiated fuel at the reactor until title of the fuel is transferred to the Secretary of Energy. This funding requirement is fulfilled through inclusion of certain high-level waste cost elements within the estimates, as described below.

The spent fuel assemblies stored in the spent fuel pool and in dry storage at the site will be transferred to the DOE, in accordance with the existing contract.Operation of the DOE's yet-to-be constructed geologic repository is contingent upon the review and approval of the facility's license application by the NRC, the successful resolution of pending litigation, and the development of a national transportation system. By comparison, the NRC's review of the 7LG Services, Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499-002, Rev. 0 DecommissioningCost Update Page2 of 20 application for an interim storage facility submitted by the Private Fuel Storage consortium began in 1997 and is still ongoing. With a more technically complex and politically sensitive application for permanent disposal, it is not unreasonable to expect that NRC approval to construct the repository at Yucca Mountain will require at least as long a review period. Construction would therefore begin sometime around the year 2010, at the earliest. The spent fuel management plan described in this section is predicated upon the DOE beginning pickup of commercial fuel in the year 2015. This timetable is consistent with the findings of an evaluation recently issued to Congress by the Government Accounting Office in their report "Technical, Schedule, and Cost Uncertainties of the Yucca Mountain Repository Project," GAO-02-191, dated December 2001.

The total inventory of assemblies that will require handling during decommissioning and the timing of their removal is based upon several assumptions. DOE's removal of spent fuel from commercial reactors is projected to begin in 2015 as noted above. The rate at which spent fuel is removed from commercial reactors is based upon an annual capacity at the geologic repository that ramps up to 3,000 metric tonnes of uranium (MTU).

This acceptance rate is consistent with the rate specified in the "Analysis of the Total System Life Cycle Cost of the Civilian Radioactive Waste Management Program" (DOE/RW-0533) issued in May 2001. Any delay in the startup of the repository or decrease in the rate of acceptance will correspondingly prolong the transfer process and result in spent fuel remaining at the site longer.

DOE's contracts with commercial reactors allocates its capacity to accept spent fuel from commercial reactors based upon the date on which spent fuel was last removed from a reactor. The "oldest" fuel provides the utility with the highest priority for spent fuel removal.

Spent fuel acceptance schedules for each unit were developed by applying projected DOE-acceptance against total industry discharges. STPEG's first core discharge was in 1989. The total industry discharge at that time was 19,482 MTU. Therefore, based on the acceptance schedule (described above),

the first spent fuel would be picked up in year 10 of DOE's repository operations in 2024. STPEG's final core discharge is expected in 2029 based on the units' 40-year lifetimes. The total estimated industry discharge at this time is estimated to be approximately 91,000 MTU. This is a mid-case projection that assumes no new reactor startups, no early shutdowns and no life extensions of current operating U.S. plants. Therefore, based on the acceptance schedule, the last spent fuel would be picked up in year 33 of DOE's repository operations in 2047.

TLG Services,Inc.

South Texas ProjectElectric GeneratingStation Document 830-1499-002,Rev. 0 DecommissioningCost Update Page3 of20 Given the length of time during which STPEG will need to store spent fuel, it is reasonable to assume that the licensee will develop supplemental storage at the site at an ISFSI such that decommissioning can be completed in the shortest time practical. Table 1 provides the spent fuel management schedule incorporated into the decommissioning estimates. The inventory levels (approximately 2025 and 2001 assemblies for Unites 1 and 2 respectively) represent the total number of fuel assemblies discharged from each unit, based on nominal projections fuel burnup over the units' 40-year lifetimes. ISFSI inventory is based upon fuel pool capacity and the projections for DOE removal of spent fuel noted above. The last core off-loads of spent fuel will be stored in the fuel storage pools for approximately five years after the cessation of plant operations. The five years is based upon the acceptance criterion for standard fuel as defined in the standard contract and the current design of dry storage systems.

Operation and maintenance costs for the ISFSI are included with the estimate. The estimate also addresses the cost for staffing the facility, as well as security, insurance and licensing fees. The estimates include the costs to load and transfer the fuel storage canisters, as well as the cost to construct the ISFSI itself. Costs are also provided for the final disposition of the facility once the transfer is complete. Other spent fuel caretaking costs include the costs for storage pool maintenance, security and associated operating expenses.

With the storage pools emptied, decommissioning operations can be concluded and the operating licenses terminated. Costs are included within the estimates to site, construct, and license an independent spent fuel storage facility, and for continued operation of this facility until the year 2047, when the DOE is expected to complete the transfer and acceptance of STP fuel. Expenditures include licensing, permits, engineering, site alterations, pad construction, cask transfer equipment and the purchase of storage canisters and concrete storage overpacks. Caretaking costs include staffing, insurance, and fees, as well as costs associated with the final disposition of the facility. The decommissioning cost for the ISFSI is identified as a separate line item cost in the cost table.

Canister Desian A multi-purpose storage canister, with a 24-fuel assembly capacity, is used for the storage of fuel at the ISFSI and in the transfer of spent fuel to the DOE.

An average cost of $800,000 is used for the cost of a multi-purpose canister and storage overpack. For fuel transferred directly from the pool to the DOE, the DOE is assumed to provide the canisters at no additional cost to the owners.

TLG Services,Inc.

South Texas Project Electric GeneratingStation Document 830-1499-002, Rev. 0 DecommissioningCost Update Page4 of 20 Canister Loading and Transfer An average cost of $200,000 is used for the labor and materials to load the spent fuel into the DOE transport cask. For estimating purposes, 50% of this cost is used to estimate the cost to transfer the fuel from the ISFSI to the DOE.

Since the costs for managing the ISFSI is assigned to Unit 2, all canister transfer costs incurred after the site restoration period have been allocated to Unit 2.

Operations and Maintenance An annual cost of approximately $997,000 and $70,000 is used for operation and maintenance (O&M) of the spent fuel pools (operating for 5 years after shutdown) and the ISFSI (operating approximately 20 years), respectively.

These O&M costs are exclusive of labor, which is included as a utility staffing or security staffing cost, and exclusive of nuclear liability and property insurance, property taxes, regulatory agency fees, and emergency planning fees, which are separately itemized costs. Spent fuel pool O&M costs are allocated to each unit. Since the cost for managing the ISFSI is assigned to Unit 2 after the site restoration period, all ISFSI O&M costs have been allocated to Unit 2. However, it is beyond the scope of this update to distinguish precisely between costs resulting from the presence of spent fuel on the site from other costs that the licensee must incur to complete decommissioning.

Spent Fuel Pool Isolation A cost of $8.4 million is used to account for isolation of the spent fuel storage pools and fuel handling systems in Unit 1, such that decommissioning operations can commence on the balance of the plant. This cost is reduced to

$5.6 million for Unit 2, since the engineering, planning, and design work was already completed for Unit 1.

ISFSI Design Considerations A multi-purpose (storage and transport) dry shielded storage canister with a vertical, reinforced concrete storage overpack is used as a basis for the cost analyses. The overpacks are assumed to have some level of neutron-induced activation as a result of the long-term storage of the fuel, i.e., to levels exceeding free-release limits. The cost to dispose of this material, as well as the demolition of the ISFSI facility, is included in the estimate.

TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499-002,Rev. 0 DecommissioningCost Update Page 5 of 20 Nuclear Property and Liability Insurance Nuclear Property and Liability Insurance coverage requirements and premiums will be affected by the presence of spent nuclear fuel. This includes higher coverage for the first 18 months after unit shutdown, due to the potential risk of a zircaloy fire, as well as coverage while the ISFSI is in operation, after the physical decommissioning work has been completed. The insurance premiums (or allocated share of the premiums) associated with these periods have been assigned as a spent fuel cost. These costs are assigned to each of the units until site restoration is complete. Thereafter, consistent with the cost study allocations, these costs are assigned to Unit 2.

Security Staffing Security will be required due to both the presence of spent fuel, as well as the presence of large quantities-of radioactive materials. Security staff assigned to the decommissioning project is assumed to be absorbed by the license termination workforce, while there is substantial physical decommissioning work in progress. The security staff after this period is assumed to be principally dedicated to ISFSI security, with the majority of the cost allocated as a spent fuel cost. However, it is beyond the scope of this update to distinguish precisely between costs resulting from the presence of spent fuel on the site from other costs that the licensee must incur to complete decommissioning. Consistent with the cost study allocations, spent fuel security costs are assigned to Unit 2.

Utility Staffin The utility staff will be required due to both the presence of spent fuel as well as to oversee and support the decommissioning work. While there is substantial physical decommissioning work in progress utility staff assigned to operate the spent fuel pools and ISFSI is assumed to be absorbed by the license termination workforce. A fraction of utility staff after this time period is assumed to be dedicated to ISFSI operations, and is allocated as a spent fuel cost. However, it is beyond the scope of this update to distinguish precisely between costs resulting from the presence of spent fuel on the site from other costs that the licensee must incur to complete decommissioning. Consistent with cost study allocations, spent fuel utility staff costs are assigned to Unit 2.

TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499-002, Rev. 0 DecommissioningCost Update Page 6 of20 NRC and NRC ISFSI Fees The NRC requires an annual fee to be paid by reactor licensees in a decommissioning status. This fee is applicable to a reactor in a decommissioning status with spent fuel on-site. This fee (identified as "NRC Fee" in the cost table) has been allocated as a license termination cost, until the reactor license has been terminated. Thereafter, this cost has been allocated as a spent fuel cost (identified as "NRC ISFSI Fee" in the cost table).

These costs are assigned to each of the units until site restoration is complete.

Thereafter, consistent with the cost study allocations, these costs are assigned to Unit 2.

Property Taxes Throughout the decommissioning project, an annual property tax cost has been included. There is an annual property tax associated with the ISFSI, after all decommissioning and site restoration activities have been completed. This annual tax has been allocated as a spent fuel cost in all years in which the ISFSI is in operation. The remaining property taxes are allocated to license termination or site restoration costs. These costs are assigned to each of the units until site restoration is complete. Thereafter, consistent with the cost study allocations, these costs are assigned to Unit 2.

Emergency Planning Fees Whenever spent fuel is present on site, an annual Emergency Planning fee has been included, and designated as a spent fuel cost. These costs are assigned to each of the units until site restoration is complete. Thereafter, consistent with the cost study allocations, these costs are assigned to Unit 2.

1.2 UTILITY, DOC AND SECURITY STAFF The staff required to support and manage a decommissioning project represents a significant project cost. In order to reflect changes from 1998 to 2004, both labor costs as well as numbers of individuals assigned to the project were updated. Labor costs based on STPEGS representative salary levels were incorporated into the model. In addition, staffing levels were adjusted to reflect experience from ongoing U.S. power reactor decommissioning projects.

Based on information obtained from STPNOC, overhead rates remained constant (average rate is 50% of salary).

The following table reflects the results of the cost estimate update:

TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499-002, Rev. 0 DecommissioningCost Update Page 7 of20 CHANGE IN UTILITY, DOC, CONSULTING ENGINEERING, AND SECURITY OFFICER SALARIES AND MAN-HOURS Change 1998 2004 (%)

Average Annual "Utility" Salary (including all A&G and overheads)

(dollars) 87,000 116,000 33.3 Average Annual "DOC" Salary (including all overheads and profit) (dollars) 99,000 130,000 31.3 Average Annual "Consulting Engineering" Salary (including all 208,000 189,000 <9.1>

overheads, per diemns and profit)

(dollars)

Average Annual Security Officer Salary* 31,000 50,000 61.3 (including all overheads and profit)

(dollars)

Total Utility Staff (Man-Hours) 3,805,000 4,129,000 8.5 Total DOC Staff (Man-Hours) 1,387,000 1,806,000 30.2 Total Consulting Engineering Staff (Man- 158,546 158,546 0.0 Hours)

Total Security Staff (Man-Hours) 966,000 1,006,000 4.1 The average security salary in the 1998 study did not include a 40% overhead, therefore the cost differential is unusually high.

The staffing levels were generally not affected by the project schedule, since the license termination and completion of spent fuel pickup did not change between the 1998 and 2004 cost estimates.

1.3 WASTE PROCESSING AND DISPOSAL COSTS Decommissioning a nuclear power station generates a substantial amount of radioactive waste, which results in a substantial decommissioning cost. The quantity of waste generated from the decommissioning project was assumed to be unchanged since the 1998 study, however, the cost of waste processing and disposal was updated to incorporate the latest rate schedules. Based on STPNOC provided waste schedules, the following is a summary of the TLG Services, Inc.

South Texas ProjectElectricGeneratingStation Document S30-1499-002, Rev. 0 Decommissioning Cost Update Page8 of 20 changes in the waste processing and disposal costs between the 1998 and 2004 study.

CHANGE IN WASTE PROCESSING AND DISPOSAL COSTS Change 1998 2004 (%)

Direct Disposal of Low-Level Radioactive Waste ($'s/Ilb) 4.40 5.10 15.9 Processing of Contaminated Metallic Waste ($'s/ lb) 1.40 2.00 42.9 Disposal of Dry Active Waste (DAW) (paper, cloth and similar consurnables)*($'s/ lb) 4.40 3.25 <26.1>

Disposal of Bulk Debris (such as contaminated 4.40 0.45 <89.8>

concrete)* ($'s/ Ib)

Disposal of Greater-Than- 17,800 22,100 24.2 Class-C Waste ** ($'sI ft3)

• Direct disposal of low-level waste was used for disposal of DAW and bulk debris in the 1998 study.

• • The contingency value assigned to GTCC waste was reduced from 50% to 15% in this update.

This reflects TLG's current practice of classifying this cost as a "Government Service" rather than as a highly activated component disposal cost. With adjustments for contingency the change is <5.1%>.

1.4 NRC FEES The NRC recovers a large fraction of its operating budget through a cost recovery program. The fees for cost recovery are published in the Code of Federal Regulations, and are updated on a regular basis. The number of NRC staff man-hours charged to the project was assumed to be unchanged since the 1998 study, however, the hourly cost and annual fees were updated to incorporate the latest rate schedules. Based on schedules extracted from the Code of Federal regulations, the following is a summary of the changes in NRC hourly rates and annual fees.

TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499-002, Rev. 0 DecommissioningCost Update Page 9 of 20 CHANGE IN NRC FEES Change 1998 2004 (%)

NRC Annual Fee (Power Reactor with Fuel On-Site in Decommissioning Status) (per unit) ($'s/yr) 150,000 319,000 212.7 NRC Annual ISFSI Fee* (per site)

($'s/yr) 283,000 319,000 12.7 Average Cost Per Professional Staff Hour ($'slhr) 131 156 19.1 The current study, consistent with current NRC regulations, only includes the Annual ISFSI Fee after the reactor license has been terminated. In the 1998 study the ISFSI Fee was applied for the entire duration of the project.

1.5 ESCALATION OF OTHER COSTS In order to account for escalation of costs between 1998 and 2004, costs that were not updated based on specific 2004 cost values, were escalated using Bureau of Labor Statistics (BLS) indices, produced by the U.S. Department of Labor.

The index chosen (for all items not updated based on specific 2004 values, excluding energy), is "Employment Cost Index, Total Compensation, Private Industry, South Region" (ecul3202i). This was selected since it is used in NRC's minimum funding formula for escalating labor, equipment and materials as described in NRC's NUREG/CR-1307, Volume 10 - "Report on Waste Burial Charges". Since the BLS does not forecast inflation, the 2004 index has not been published. Therefore TLG determined the average annual increase between 1997 and 2003, and applied this increase to represent the change between 1998 and 2004. The average annual rate of change was calculated at 3.34%, resulting in an increase of 21.8% over the 6 year period.

The index chosen for energy is "Producer Price Index, Fuels and Related Products and Power, Industrial Electric Power" (wpu0543). This was selected since it is used in NRC's minimum funding formula for escalating energy as described in NUREG/CR-1307, Volume 10. Similar to what was done with the employment cost index, TLG determined the average annual increase between 1997 and 2003 and applied this increase to represent the change between 1998 TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499-002, Rev. 0 DecommissioningCost Update Page 10 of20 and 2004. The average annual rate of change was calculated at 1.86%,

resulting in an increase of 11.7% over the 6 year period.

It should be noted that property taxes were not escalated in this cost update (at the direction of STPNOC).

1.6 REACTOR VESSEL DISPOSITION COSTS The reactor vessel and internals disposition calculations were revised to incorporate current TLG methods used for estimating reactor vessel disposition costs and updated Andrews County, Texas waste facility disposal costs.

Revisions to TLG methods include the following significant elements:

" Incorporated the current lifetime operations history (megawatt-hours to date), and assumed there is an increased capacity factor over the remainder of plant life (90% v. 80% in the previous study). These changes affect the neutron activation levels, which affects the curie content at time of shutdown, and affects the cost of GTCC disposal (estimated cost of GTCC disposal is tied to the cost of disposal of spent fuel).

" A revised approach to calculating the packaged volume of GTCC material.

The updated approach reduces the total packaged volume of GTCC material.

" A revised contingency is applied to the disposal of GTCC material (15% v.

50% in the previous study). This is intended to reflect that the waste will be transferred to the DOE, and therefore the cost is related to a government service.

" The cost for disposal of GTCC material has been assigned to the last year of the spent fuel pickup (2047). This does not affect cost in current year dollars, but will affect present value cost calculations.

" A revised approach to the packaging of lightly-activated material (current approach is to assume that much of the lightly-activated material is now packaged in B-25 boxes, rather than cask liners).

• The segmentation and packaging crew's cost structure was changed to reflect the use of outside contractors to do the reactor vessel segmentation and packaging, rather than the on-site work force (this is the current U.S.

industry practice)

" Material costs were updated with new vendor information, or escalated from the last study.

TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499-002, Rev. 0 DecommissioningCost Update Page 11 of 20 1.7 PROJECT SCHEDULE Despite a later estimated start date of DOE .spent fuel acceptance, increases in the estimated rate at which spent fuel is accepted by the DOE resulted in the project schedule remaining essentially unchanged from the 1998 study (spent fuel is estimated to be picked up by the end of third quarter in 2047 in this study, versus the middle of 2048 in the 1998 study. A timeline of events is provided in Figure 1. Significant milestone dates in the decommissioning estimate are noted in the following table.

SIGNIFICANT MILESTONES MILESTONE EVENT DATE DOE initiates spent fuel pickup (commercial reactors) 2015 Unit 1 - DOE initiates spent fuel pickup 2024 Unit 2 - DOE initiates spent fuel pickup 2025 Unit 1 - Permanent Cessation of Operations 2027 Unit 2 - Permanent Cessation of Operations 2028 Unit 1 - Initiate Spent Fuel Transfer to ISFSI 2028 Unit 2 - Initiate Spent Fuel Transfer to ISFSI 2029 Unit 1 - Spent Fuel Pool Empty (5 years - 2 months after 2032 shutdown)

Unit 2 - Spent Fuel Pool Empty (5 years - 2 months after 2034 shutdown)

ISFSI - Initiate Fuel Transfer from ISFSI to DOE 2033 Unit 1 - Reactor License Terminated 2034 Unit 2 - Reactor License Terminated 2036 Unit 1 - Site Restoration Complete 2037 Unit 2 - Site Restoration Complete 2037 ISFSI - Transfer GTCC stored in ISFSI to DOE 2047 ISFSI - Complete Fuel Transfer from ISFSI to DOE 2047 TLG Services, Inc.

South Texas ProjectElectricGeneratingStation Document S30-1499-002, Rev. 0 DecommissioningCost Update Page 12 of 20 1.8 CO-OWNERS COST An objective of this update was to estimate the co-owners Schedule of Annual expenditures, considering ownership allocations, contingency values at 10%,

and tax exemption considerations. The "average reduction" between the base case estimate, and each owner's cost developed in the 1998 analysis was calculated and applied to the updated cost estimate (2004 dollars). For clarification, these values, and the corresponding reductions, are as shown in Table 2. The new base case schedule of annual expenditures was developed by reducing the base case by these average reduction values.

1.9 OTHER ESTIMATING ASSUMPTIONS With the exceptions of the items described above, the estimate relied on the assumptions developed for the 1998 decommissioning cost study (TLG document H01-1323-002, Rev. 2, dated December 1998). This includes elements such as, plant equipment and structures inventories, scope of work (what is included as a decommissioning activity), contamination levels, energy consumption, unit cost factors (worker productivity), and project contingencies.

A complete definition of assumptions is contained in sections 1 through 5 of the 1998 study.

TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499-002, Rev. 0 DecommissioningCost Update Page 13 of20

2. RESULTS The costs based on this technical and economic update are provided in Appendix A, Tables A-1 and A-2. These tables provide the same types of information that were provided in Tables C-1 and C-2 of the 1998 study. The total cost to decommission the station with the updated assumptions is $1,419,448,073; or an increase/decrease of 287,699,387 (25.4%). The estimated annual schedules of expenditure based on this estimate are provided in Tables 3.1 and 4.1. These tables provide the same information that was provided in Table 3.3 and 3.4 of the 1998 study. In addition estimated annual schedules of expenditures related to managing spent fuel are provided in Tables 3.2 and 4.2. The basis for spent fuel management costs are explained in Section 1, and are itemized in Tables A-1 and A-2 (refer to the column labeled "Spent Fuel Mgmt.")

In order to establish owner-specific disbursements, based on ownership allocations, previously specified contingency values, and tax exemption considerations, a schedule of annual expenditures has been developed for each owner, by unit. These schedules are provided in Appendix B, Tables B-1 through B-4. Consistent with the 1998 study these tables represent the following:

" Expenditure schedules for Texas Genco, LP and AEP Texas Central Company include state sales tax and property tax allocations, as applicable, the schedules for CPS and COA, the two municipal owners, do not.

" Expenditure schedules are based on a flat contingency rate of 10%.

• The ownership share remains unchanged from the 1998 study (refer to Table 2).

TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499-002, Rev. 0 DecommissioningCost Update Page 14 of 20 TABLE 1.0 SPENT FUEL MANAGEMENT SCHEDULE EX-CORE FUEL ASSEMBLIES*

Unit 1 Unit 2 On-Site ISFSI Inventory DOE On-Site ISFSI Inventory DOE Year Inventory (assemblies) (canisters) Acceptance Inventory (assemblies) (canisters) Acceptance 2024 1,669 0 0 87 1,660 0 0 0 2025 1,582 0 0 87 1,649 0 0 87 2026 1,571 0 0 87 1,634 0 0 87 2027 1,677 0 0 87 1,547 0 0 87 2028 1,590 240 10 87 1,653 0 0 87 2029 1,503 480 20 87 1,566 240 10 87 2030 1,416 744 31 87 1,479 480 20 87 2031 1,329 984 41 87 1,392 720 30 87 2032 1,242 1,242 52 87 1,305 960 40 87 2033 1,155 1,155 49 87 1,218 1218 51 87 2034 1,068 1,068 45 87 1,131 1131 48 87 2035 981 981 41 87 1,044 1044 44 87 2036 894 894 38 87 957 957 40 87 2037 807 807 34 87 870 870 37 87 2038 720 720 30 87 783 783 33 87 2039 633 633 27 87 696 696 29 87 2040 546 546 23 87 609 609 26 87 2041 459 459 20 87 522 522 22 87 2042 372 372 16 87 435 435 19 87 2043 285 285 12 87 348 348 15 87 2044 198 198 9 87 261 261 11 87 2045 111 111 5 87 174 174 8 87 2046 24 24 1 87 87 87 4 87 2047 0 0 0 24 0 0 0 87 Total 2,025 2,001

• Inventories are approximate and reflect projected/estimated quantities TLG Services,Inc.

South Texas ProjectElectric GeneratingStation Document 830-1499-002, Rev. 0 DecommissioningCost Update Page 15 of 20 TABLE 2.0 CO-OWNER DECOMMISSIONING COST ALLOCATIONS Base Case Costs (1998 dollars)

Unit 1 (Note 1) 515,465,630 Unit 2 (Note 2) 616,283,056 Owner Texas Genco, AEP Texas CPS COA LP (formerly Central Co.

HL&P) (formerly CP&L)

Percent Ownership 30.8% 25.2% 28.0% 16.0%

(Note 3)

Decommissioning Cost 152,863,835 125,070,411 126,204,595 72,116,911 (allocated) (1998 dollars) (10%

contingency) - Unit 1 (Note 4)

Decommissioning Cost 184,080,980 150,611,711 151,278,943 86,445,110 (allocated) (1998 dollars) (10%

contingency)- Unit 2 (Note 5)

Average Reduction .2966 .2426 .2448 .1399 (Base Case to Allocated Share) -

Unit 1 (Note 6)

Average Reduction .2987 .2444 .2455 .1403 (Base Case to Allocated Share) -

Unit 2 (Note 6)

Note 1: Refer to Appendix C-1 of 1998 TLG report Note 2: Refer to Appendix C-2 of 1998 TLG report Note 3: Refer to Appendix E of 1998 TLG report Note 4: Refer to Appendix E, Tables E-1, E-3, E-5 and E-7 of 1998 TLG report Note 5: Refer to Appendix E, Tables E-2, E-4, E-6 and E-8 of 1998 TLG report Note 6: Calculated by ratio of Owner's Cost to Base Case Cost TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499-002, Rev. 0 DecommissioningCost Update Page 16 of 20 TABLE 3.1 SCHEDULE OF ANNUAL EXPENDITURES DECON Alternative - Unit 1 (2004 Dollars)

Period 3 Period 1 Period 2 Site Site Year Planning Decommissioning Restoration Restoration Total Offset 2027 40,009,022 0 0 0 40,009,022 2028 113,943,089 0 0 0 113,943,089 2029 14,993,215 91,265,205 0 0 106,258,420 2030 0 9.5,153,173 0 0O 95,153,173 2031 0 79,081,192 0 0 79,081,192 2032 0 76,963,622 0 0 76,963,622 2033 0 63,503,463 0 0 63,503,463 2034 0 7,008,629 835,794 0 7,844,424 2035 0 0 2,674,366 0 2,674,366 2036 0 0 65,430 21,114,597 21,180,027 2037 0 0 0 17,799,013 17,799,013 2038 0 0 0 0 0 2039 0 0 0 0 0 2040 0 0 0 0 0 2041 0 0 0 0 0 2042 0 0 0 0 0 2043 0 0 0 0 0 2044 0 0 0 0 0 2045 0 0 0 0 0 2046 0 0 0 0 0 2047 0 0 0 17,741,317 17,741,317 2048 0 0 0 0 0 168,945,326 412,975,284 3,575,590 56,654,926 642,151,127 TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499-002, Rev. 0 DecommissioningCost Update Page17 of20 TABLE 3.2 SCHEDULE OF ANNUAL EXPENDITURES DECON Alternative (Certain Spent Fuel-Related Costs') - Unit 1 (2004 Dollars)

Period 3 Period 1 Period 2 Site Site Year Planning Decommissioning Restoration RE*storation Total Offset 2027 13,342,759 13,342,759 2028 33,070,745 33,070,745 2029 4,256,930 16,738,056 20,994,986 2030 13,848,765 13,848,765 2031 5,044,110 5,044,110 2032 4,242,662 4,242,662 2033 862,290 862,290 2034 688,345 367,710 1,056,054 2035 1,176,593 1,176,593 2036 28,786 1,175,644 1,204,430 2037 991,035 991,035 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 50,670,434 41,424,227 1,573,089 2,166,679 95,834,429 Note 1: Although some spent fuel management costs are reflected here, it is beyond the scope of this study to distinguish precisely between costs resulting from the presence of spent fuel on the site and other costs that the licensee must incur to complete decommissioning.

TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document 830-1499-002, Rev. 0 DecommissioningCost Update Page 18 of 20 TABLE 4.1 SCHEDULE OF ANNUAL EXPENDITURES DECON Alternative - Unit 2 (2004 Dollars)

Post Decommissioning ISFSI Operations Period 1 Period 2 Site Spent Fuel ISFSI Year Planning D&D Restoration Transfer D&D Total 2028 4,394,183 0 0 0 0 4,394,183 2029 89,685,306 0 0 0 0 89,685,306 2030 38,994,842 71,392,645 0 0 0 110,387,487 2031 0 104,160,906 0 0 0 104,160,906 2032 0 93,625,142 0 0 0 93,625,142 2033 0 90,772,043 0 0 0 90,772,043 2034 0 79,646,821 0 0 0 79,646,821 2035 0 34,031,434 0 0 0 34,031,434 2036 0 424,836 50,568,116 0 0 50,992,952 2037 0 0 42,627,504 755,284 0 43,382,788 2038 0 0 0 4,307,480 0 4,307,480 2039 0 0 0 4,307,480 0 4,307,480 2040 0 0 0 4,319,281 0 4,319,281 2041 0 0 0 4,307,480 0 4,307,480 2042 0 0 0 4,307,480 0 4,307,480 2043 0 0 0 4,307,480 0 4,307,480 2044 0 0 0 4,319,281 0 4,319,281 2045 0 0 0 4,307,480 0 4,307,480 2046 0 0 0 4,307,480 0 4,307,480 2047 0 0 0 20,951,274 10,689,696 31,640,970 2048 0 0 0 0 5,785,991 5,785,991 2049 0 0 0 0 0 0 133,074,330 474,053,828 93,195,620 60,497,481 16,475,687 777,296,946 TLG Services, Inc.

South Texas ProjectElectricGeneratingStation Document S30-1499-002, Rev. 0 Decommissioning Cost Update Page 19 of 20 TABLE 4.2 SCHEDULE OF ANNUAL EXPENDITURES DECON Alternative (Certain Spent Fuel-Related Costs') - Unit 2 (2004 Dollars)

Post Decommissioning ISFSI Operations Period 1 Period 2 Site Spent Fuel ISFSI Year Planning D&D Restoration Transfer D&D Total 2028 1,466,299 1,466,299 2029 23,361,411 23,361,411 2030 7,550,303 23,801,499 31,351,802 2031 16,800,152 16,800,152 2032 7,406,180 7,406,180 2033 5,120,152 5,120,152 2034 2,697,964 2,697,964 2035 2,894,415 2,894,415 2036 75,852 3,207,957 3,283,810 2037 2,704,218 755,284 3,459,502 2038 4,307,480 4,307,480 2039 4,307,480 4,307,480 2040 4,319,281 4,319,281 2041 4,307,480 4,307,480 2042 4,307,480 4,307,480 2043 4,307,480 4,307,480 2044 4,319,281 4,319,281 2045 4,307,480 4,307,480 2046 4,307,480 4,307,480 2047 3,209,958 10,689,696 13,899,653 2048 5,785,991 5,785,991 2049 32,378,014 58,796,214 5,912,175 42,756,164 16,475,687 156,318,253 Note 1: Although some spent fuel management costs are reflected here, it is beyond the scope of this study to distinguish precisely between costs resulting from the presence of spent fuel on the site and other costs that the licensee must incur to complete decommissioning.

TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499-002, Rev. 0 Decommissioning Cost Update Page 20 of 20 FIGURE 1 TIMELINE OF EVENTS Unit 1 (Shutdown August 20, 2027)

Period 1 Period 3 Transition and Period 2 Site Preparations Decommissioning Restoration 08/2027 02/2029 09/2034 10/2037 Storage Pool Empty 10/2032 02/2028 09/2047 L ~Spent Fuel in Dry Fuel StorageJ I

Unit 2 (Shutdown December 15, 2028)

Period 1 Period 3 Transition and Period 2 Site ISFSI ISFSI Preparations Decommissioning I RP..Qtnrqinn Operations 12/2028 06/2030 01/2036 10/2037 09/2047 03/2048 Storage Pool Empty 02/2034 TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499-002, Rev. 0 DecommissioningCost Update Appendix A, Page I of 19 APPENDIX A DECOMMISSIONING COST ESTIMATES DECON Alternative Page South Texas Project, U nit 1 ........................................................................................ A-2 South Texas Project, Unit 2 ............................................................................... A-11 TLG Services,Inc.

South Texas ProjectElectricGeneratingStation DocumentS30-1499-002, Rev. 0 DecommissioningCost Update Appendix A, Page2 of 19 TABLE A-1 SOUTH TEXAS PROJECT - UNIT I DECON, DECOMMISSIONING COST ESTIMATE (Thousands of 2004 Dollars)

Columns may not add due to rounding

• )

• NRC Spent Site LLW site GTCC Craft Laborl" Nwnbe, Activity Description Decon Remove Pack Ship Burial Other Contingency Total LicTerm Fuel Mt. Restore A CF B CF C CF CF Hours PERIOD I I Prepare preliminary decommissioning cost 118 17.7 135 135 2 Notification of Cessation of Operations Note 1 3 Remove fuel & source material Note 2 4 Notification of Permanent Defueling Note I 5 Deactivate plant systems & process waste Note 1 6 Prepare and submit PSDAR 181 27.2 208 208 7 Review plant dwgs & specs. 417 62.5 479 479 8 Perform detailed red survey Note 1 9 Estimate by-product Inventory 91 13.6 104 104 10 End product description 91 13.6 104 104 11 Detailed by-product inventory 118 17.7 135 135 12 Define major work sequence 680 102.0 782 782 13 Perform SER and EA 281 42.1 323 323 14 Perform Site-Specific Cost Study 453 68.0 521 521 15 Prepare/submit Ucense Termination Plan 371 55.7 427 427 16 Receive NRC approval of termination plan Note 1 Activity Specifications 17.1 Plant & temporary facilities 446 66.9 513 462 51 17.2 Plant systems 378 56.6 434 391 43 17.3 NSSS Decontamination Flush 45 6.8 62 52 17.4 Reactor Internals 643 96.5 740 740 17.5 Reactor vessel 589 " 88.4 677 677 17.6 Biological shield 45 6.8 52 52 17.7 Steam generators 283 42.4 325 325 17.8 Reinforced concrete 145 21.8 167 83 83 17.9 Turbine & condenser 73 10.9 83 83 17.10 Plant structures & buildings 283 42.4 325 163 163 17.11 Waste management 417 62.5 479 479 17.12 Facility & site ctoseout 82 12.2 94 47 47 17 Total 3,428 514.3 3.943 3,472 471 Planning & Site Preparations 18 Prepare dismantling sequence 218 32.6 250 250 19 Plant prep. & temp. svces 2308 346.2 2,654 2,654 20 Design water clean-up system 127 19.0 146 146 21 Rigging/CCEs/tooling/stc. 1,954 293.1 2.247 2,247 22 Procure casksliners & containers 111 16.7 128 128 TLA Services, Inc.

South Texas ProjectElectric GeneratingStation DocutentS3-1499-002, Rev. 0 Decommissioning Cost Update Appendix A, Page3 of 19 TABLE A-1 SOUTH TEXAS PROJECT - UNIT 1 DECON, DECOMMISSIONING COST ESTIMATE (Thousands of 2004 Dollars)

Columns may not add due to rounding ID NRC Spent Site LLW site GTCC Craft Laborl Numbeu Activity Description Decon Remove Pack Ship Burial Other - Contingency Total LicTerm Fuel Mit. Restore A CF B CF C CF CF Hours Detailed Work Procedures 23.1 Plant systems 429 64.3 493 444 49 23.2 NSSS Decontamination Flush 91 13.6 104 104 23.3 Vessel head 227 34.0 261 261 23.4 Reactor Internals 227 34.0 261 261 -

23.5 Remaining buildings 122 18.4 141 35 106 23.6 CRD cooling assembly 91 13.6 104 104 -

23.7 CRD housings & ICItubes 91 13.6 104 104 23.8 Incore instrumentation 91 13.6 104 104 23.9 Reactor vessel 329 49.3 378 378 23.10 Facility closeout 109 16.3 125 63 63 23.11 Missile shields 41 6.1 47 47 23.12 Biological shield 109 16.3 125 125 23.13 Steam generators 417 62.5 479 479 -

23.14 Reinforced concrete 91 13.6 104 52 52 23.15 Turbine & condensers 283 42.4 325 - 325 23.16 Auxiliary building 247 37.1 285 256 28 23.17 Reactor building 247 37.1 285 256 28 23 Total 3.239 486 3,725 3,074 652 24 Devon primary loop 987 - 493.6 1480.8 1480.8 - 800 Period I Additional Costs 25 Site Characterization Survey 1,692 508 2,200 2,200 26 Severance Plan 21,404 3.211 24,615 24,615 Subtotal Period 1 Activity Costs 987 37,282 6.340 44,609 43,486 1,123 800 Period I Undlitrlbuted Costs 656 1 Decon equipment 98 754 754 2 Deson supplies 40 10 49 49 3 DOC staff relocation expenses 1,192 179 1,371 1,371 4 Process liquid waste 149 543 545 3,030 968 5,235 5,235 6,990 313 5 Insurance 1,715 171 1,886 681 1,305 6 Property taxes 6,206 - 6,206 5.628 578 7 Health physics supplies 249 62 311 311 8 Heavy equipment rental 274 41 316 316 9 Small tool allowance 0 0 0 0 10 Disposal of DAWgenerated 330 12 1,114 313 1,769 1,769 4,031 10,965 11 Plant energy budget 3.395 509 3,904 3,904 12 ISFSI Cask Purchase 23,200 3,480 26,680 26,680 TLG Services, Inc.

South Texas ProjectElectricGeneratingStation Document S30-1499-002, Rev. 0 Decommissioning Cost Update Appendix A, Page4 of 19 TABLE A-i SOUTH TEXAS PROJECT - UNIT 1 DECON, DECOMMISSIONING COST ESTIMATE (Thousands of 2004 Dollars)

Columns may not add due to rounding iD NRC Spent Site LLW site GTCC Craft Labor Numbe Activity Description Deeon Remove Pack Ship Burial Other Contingency Total LicTerm Fuel Mgt. Restore A CF B CF C CF CF Hours Period I Undlstributed Costs (continued) 13 ISFSI Site alterations 4,124 819 4,742 4,742 14 ISFSI transfer equipment 609 91 700 700 15 ISFSI licensing and permits 1,218 122 1,339 1,339 16 NRC Fees. 572 57 629 629 17 Emergency Planning Fees 92 9 101 101 18 Site Security Cost 2,119 318 2,437 2,437 -

19 Spent Fuel Pool O&M 1,496 224 1,720 1.720 20 Spent Fuel Pool Isolation 8,358 1.254 9.612 9,612 21 Spent Fuel Transfer Costs 3.384 508 3,892 3,892 Subtotal Undiasuibuted Costs Period 1 844 1.716 874 557 4,144 56,487 9,034 73.655 22,985 50,670 4,031 6.990 11,278 Staff Costs DOC Staff Cost 8.163 1,224 9,387 9,387 Utilty Staff Cost 35,908 5,386 41,294 41,294 TOTAL PERIOD I COST 1,831 1,716 874 557 4,144 137,840 21,984 168,945 117,152 50,670 1,123 4,031 6,990 12,078 PERIOD 2 Nuclear Steam Supply System Removal 27.1 Reactor Coolant Piping 115 221 14 18 683 287 1,338 1.338 1,575 12.733 27.2 Pressurizer Relief Tank 16 90 6 6 298 107 522 522 6688 4,129 27.3 Reactor Coolant Pumps & Motors 53 44 35 29 2.426 652 3,237 3,237 5,596 4.114 27.4 Pressurizer 17 24 4 8 889 238 1.179 1,179 2,050 1,685 27.6 Steam Generators 223 3,157 2.058 947 9.115 3,422 4.041 22,964 22,964 21.027 24,566 27.6 Old Steam Generator Lower Shell Units 30 1,709 824 8,892 3,137 2.996 17,587 17.587 20,512 14,878 27.7 CRDMs/ICIs/Service Structure Removal 76 53 74 16 1.605 - 462 2,287 2,287 3,703 4,717 27.8 Reactor Vessel Internals 66 2.047 5.503 494 4,785 5,460 18.356 18,356 2,003 788 459 16,207 27.9 Reactor Vessel 51 3,706 1,475 372 8,830 - 7,681 22,115 22.115 7,178 2,629 - 31.297 27 Totals 617 9,372 10,877 2,711 37,524 6,559 21,924 89.585 89,585 64,333 3,417 459 114,325 28 Remove spent fuel racks 335 30 14 3 1.654 3,816 1,163 7.016 7.016 3,816 -- 14,170 Removal of Major Equipment 29 Main Turbine/Generator 73 11 84 84 3,298 30 Main Condensers 384 58 441 441 16,323 TLG Services; Inc.

South Texas ProjectElectricGenerating Station Document 830-1499-002, Rev. 0 DecommissioningCost Update Appendix A, Page 5 of'19 TABLE A-1 SOUTH TEXAS PROJECT - UNIT 1 DECON, DECOMMISSIONING COST ESTIMATE (Thousands of 2004 Dolars)

Columnns may not add due to rounding NRC Spent Site LLW site GTCC Craft Laborl lNfumbei Activity Descrintion Decon Renmove Pack Shin Burial Other Contineencv Total LicTer. Fuel Met. Restore A CF B CF C CF CF a-ou-s Disposal of Plant Systems 31.1 Auxiliary Feedwater (AF) - 46 7 53 53 2,145 31.2 Auxiliary Feedwater (AF) RCA 2 5 2 9 9 310 31.3 Auxiliary Steam & Boilers (AS) 37 .5 42 42 1,754 31.4 Auxiliary Steam & Boilers (AS) RCA 7 14 5 26 26 899 31.5 BOP Chemical Feed (CF) 15 2 17 17 687 31.6 BOP Diesel Generator (DB) 16 2 18 18 734 31.7 Bornn Recycle (BR) - 306 13 7. 619 124 252 1,320 1.320 1,428 11,635 31.8 Breathing Air (BA) RCA 28 58 23 108 108 3.291 31.9 Chemical & Volume Control (CV) 742 716 21 12 1,078 129 843 3,541 3.541 2,486 54.061 31.10 Chilled Water HVAC (CH) 77 12 88 - 88 - 3,589 31.11 Chilled Water HVAC (CH) RCA 109 258 93 460 460 15,455 31.12 Circulating Water (CW) 198 30 227 227 9,450 31.13 Circulating Water Screen Wash (SC) 29 4 34 34 1,361 31.14 Closed Loop Auxillary Cooling Water (AC) 52 8 59 - 59 2,456 31.15 Component Cooling Water (CC) RCA 422 884 344 1,650 1.00w 51.670 31.16 Condensate (CD) - 336 50 385 386 15.922 31.17 Condensate Polisher (CP) 135 20 155 155 6.304 31.18 Condensate Storage (CT) 29 4 33 33 1,316 31.19 Condenser Air Removal (CR) 28 4 32 32 1,321 31.20 Containment Building (XC) 85 0 0 2 15 24 126 126 5 3,236 31.21 Containment Building HVAC (HC) 2,036 11 6 520 1,914 928 5,415 5,415 1,200 68,174 31.22 Containment Combustible Gas Control (CG 24 0 0 2 13 8 47 47 5 915 31.23 Containment Hydrogen Monitoring (CM) 124 1 .1 50 39 50 264 264 - 116 4,737 31.24 Containment Spray (CS) 49 38 30 116 74 44 3,676 31.25 Control Room HVAC (HB) Clean - 87 13 100 - 100 3,945 31.26 Dernineralizer Water (DW) 24 4 28 - 28 1.156 31.27 Demlneralizer Water (DW) RCA 30 63 25 117 117 3,705 31.28 Diesel Generator Building (XG) 5 1 6 6 235 31.29 ECW & ECW Screen Wash (EW) 305 46 351 - 351 14,693 31.30 ECW & ECW Screen Wash (EW) RCA 99 167 75 341 341 10.664 31.31 Electrical Auxiliary Building (XE) 47 7 05 - 55 2,038 31.32 Electrical Auxiliary Building HVAC (HE) 179 27 206 206 8,079 31.33 Electrical Clean Non RCA 479 72 551 551 22,327 31.34 Electrical Clean RCA 248 901 259 1,409 1,409 44.307 31.35 Electrical Contaminated - 391 254 144 184 981 981 - 586 - - 15,215 31.36 Electlro-Hydraulic Controls (EH) 20 3 23 23 918 31.37 Extracton Steam (ES) 84 13 97 97 4,067 31.38 Feedwater (FW) 178 27 205 205 8,503 31.39 Feedwater (FW) RCA 7 13 5 25 25 782 31.40 Fire Protection (FP) 56 8 64 - 64 2,695 31.41 Fire Protection (FP) RCA 36 73 29 139 139 0 4.372 TLG Services, Inc.

South Texas ProjectElectricGeneratingStation Document S30-1499-002, Rev. 0 Decommissioning Cost Update Appendix A, Page6 of 19 TABLE A-i SOUTH TEXAS PROJECT - UNIT I DECON, DECOMMISSIONING COST ESTIMATE (Thousands of 2004 Dollars)

Columns may not add due to rounding ID NRC Spent Site LLW site GTCC Craft Laborl Mumbeo Activity Description Decon Remove Pack Ship Burial Other Contingency Total LicTer- Fuel Mgt. Restore A CF B CF C CF CF Hours Disposal of Plant Systems (continued) 31.42 Fuel Handling Building (XF) 51 0 0 13 6 17 87 87 30 1,951 31.A3 Fuel Handling Building HVAC (HF) 940 3 1 119 773 381 2,216 2,216 275 32,316 31.44 Gas Storage C02 & H2 (CO/HY) 1 0 1 - 36 31.45 Gaseous Waste Processing (WG) 116 1 1 65 56 54 292 292 149 4,332 31.46 Generator C02 & H2 (GG) 7 1 8 8 336 31.47 Generator Hydrogen Seal Oil (SO) 7 1 8 8 321 31.48 Heater Drip&Vent (HD/HV) 143 21 164 164 6,841 31.49 Hot Shop & Decontamination Facility (XN) 32 0 0 4 13 11 61 61 - 10 1,237 31.50 Instrument Air (IA) 119 18 137 - 137 5,593 31.51 Integrated Leak Rate Test (IL) 149 0 0 16 40 47 252 252 - 36 5,774 31.52 Isolation Valve Cubicle Building (XV) 2 0 3 - 3 96 31.53 Liquid Waste Processing (WL) 1.131 1,058 18 10 896 875 1,189 5.177 5,177 2,067 79,318 31.54 Low Pressure Nitrogen (NL) 16 2 18 - 18 739 31.55 Lube Oil Purification Strg & Trnsfr (LO) 24 4 26 - 28 1,114 31.56 MAB Plant Vent Header (VE) 8 0 0 6 24 7 46 46 14 320 31.57 Main Generator (GE/GM/NN) 12 2 14 - 14 547 31.58 Main Steam (MS) 246 37 287 - 287 11,924 31.59 Main Steam (MS) RCA 11 20 9 40 40 1,251 31.60 Main Turbine & Lube Oil (LT/TM) 46 7 52 - 52 2.119 31.61 Mechanical Audfiary Bldg HVAC (HM) RCA 4,472 1,075 2,397 7,944 7.944 212.684 31.62 Mechanical Aurdliary Butding (XM). - 200 0 0 4 36 56 297 297 - 10 7.612 31.63 Miscellaneous Drains (MD) 2 0 2 2 72 31.64 Miscellaneous HVAC (HZ) 92 14 106 106 4,224 31.65 Miscellaneous HVAC (HZ) RCA 230 sO 122 402 402 10,730 31.66 Miscellaneous Reactor Coolant (RC) 730 31 16 1.414 167 567 2.924 2,924 3.262 28,443 31.67 Miscallaneous Yard Areas & Bidgs (XY) 75 11 86 - 86 3.635 31.68 Nonradioactive Chemical Waste (NC) 2 0 2 2 85 31.69 Nonradioactive Dms & Srnps (DR) 61 9 70 70 2,954 31.70 Nonradioactive Dms & Smps (DR) RCA 56 126 47 229 229 7,713 31.71 Oily Waste (OW) 99 15 114 - 114 4,782 31.72 Open Loop Ausiliary Cooling (OC) 236 35 271 271 11,422 31.73 Plant Fuel Oil Storage & Transfer (FO) 0 0 0 0 14 31.74 Post Accident Monitor/Sample (AM/AP) 265 0 0 13 85 82 446 446 - 31 10,282 31.75 Potable Water (PW) 6 1 7 316 31.76 Potable Water (PW) RCA 13 30 11 54 54 27 1,787 31.77 Primary Process Sampling (PS) 41 0 0 12 12 15 80 80 - 27 - - 1,564 31.78 Radiation Monitoring (RA) 7 43 10 60 10 50 2.234 31.79 Radioactive Vents & Drains (ED) 760 716 14 7 651 116 741 3,005 3,005 1,501 53,749 31.80 Reactor Coolant Pump OilChange-Out (P0 - 13 0 0 5 26 8 53 63 12 50 31.81 Reactor Head Degassing (RD) 54 1 1 64 30 34 184 184 147 2.066 31.82 Reactor Makeup Water (RM) 266 2 1 90 234 124 717 717 208 10,263 TL. Services, Inc.

South Texas ProjectElectricGeneratingStation Document 830-1499-002, Rev. 0 DecommissioningCost Update AppendixA, Page 7 of19 TABLE A-1 SOUTH TEXAS PROJECT - UNIT 1 DECON, DECOMMISSIONING COST ESTIMATE (Thousands of 2004 Dollars)

Columns may not add due to rounding ID NRC Spent Site LLW site GTCC Craft Laborl Numbes Activity Description Decon Remove Pack Ship Burial Other Contingency Total LieTerm Fuel Me~t Restore A CF B CF C CF CF Hours Disposal of Plant Systems (continued) 31.83 Residual Heat Removal (RH) 357 32 18 1,586 167 517 2,678 2,678 3,659 13,936 31.84 SG Sludge Lancing & Chem Cleaning (SL) 1 0 1 1 36 31.85 Safety Injection (SI) 931 62 35 3,068 1,044 1,168 6,309 6,309 7,078 36,194 31.86 Secondary Process Sampling (SS) 29 4 34 34 - 1,365 31.87 Service Air (SA) 61 9 71 71 2.890 31.88 Service Water (T'W) 11 2 12 12 509 31.89 Sewage Treatment (ST) 23 3 26 26 1,101 31.90 Sodium Hypochiorlte (SH) 10 1 11 11 438 31.91 Solid Waste Processing (WS) 41 39 1 1 60 25 49 216 216 140 2,994 31.92 Spent Fuel Pool Cooling & Cleanup (FC) 328 21 12 1,028 2,3 381 2Z028 2.028 2,371 12,786 31.93 Standby DG Fuel Oil Strg & Tmsfr (DO) 26 4 30 30 1.193 31.94 Standby Diesel Gen Starting Air (SD) 12 2 14 14 553 31.95 Standby Diesel Generator (DG) 89 13 103 103 4.186 31.96 Standby Diesel Generator Bldg HVAC (HG) 56 8 65 65 2,545 31.97 Standby Diesel Generator Lube Oil (LU) 5 1 6 6 236 31.98 Standby Diesel Jacket Water (JW) 4 1 4 4 172

-9 -

31.99 Stator Cooling Water (GC) 8 1 9 370 31.100 Steam Generator Blowdown (SB) 68 10 78 78 3.137 31.101 Steam Generator slowdown (SB) RCA 22 41 17 80 80 2.434 31.102 Turbine Generator Building (XI) 18 3 21 21 785 31.103 Turbine Generator Building HVAC (HT) 208 31 239 239 9.382 31.104 Turbine Gland Seal (GS) 16 2 19 19 749 31 Totals 8,522 18.141 238 133 11,639 6,364 11.888 59.926 51 .882 ,5044 26.850 1,044,086 Decontamlnation of Site Buildings 32.1 Reactor 795 466 111 64 3.314 632 1.458 6.840 6.840 - 11,820 46,051 32.2 Fuel Handling 463 411 .42 22 1,104 364 673 3,079 3.079 - 3,778 32,978 32.3 Mechanical & Electrical Auxiliary 847 103 67 39 1,048 291 767 3.163 3,163 7,345 33,545 32 Totals 2,105 981 220 125 5,466 1.287 2.898 13.082 13,082 22,943 112,574 33 Terminate license Note 1 Period 2 Additional Costs 34 License Termination Survey 7,807 1.923 9,730 9,730 120,798 Subtotal Period 2 Activity Costs 11,579 28.980 11,350 2,973 56,284 25,833 39.865 176,864 171,295 5,569 117,942 3,417 459 - 1,425,575 TLG Services, Inc.

South Texas ProjectElectric GeneratingStation DocumentS30.1499-002, Rev. 0 Decommissioning Cost Update Appendix A, Page8 of 19 TABLE A-i SOUTH TEXAS PROJECT - UNIT 1 DECON, DECOMMISSIONING COST ESTIMATE (Thousands of 2004 Dollars)

Columns may not add due to rounding iD NRC Spent Site LLW site GTCC Craft Laborl Number Activity Description Decons Remove Pack Ship Burial Other Contingency Total LieTerm Fuel Mat. Restore A CF B CF C CF CF Hours Period 2 Undlstributed Costs 1 Decon equipment 656 98 754 754 2 Decon supplies 1,197 299 1,497 1,497 3 DOC staff relocation expenses - 1,192 179 1,371 1.371 4 Process liquid waste 867 - 465 718 2,818 1.292 6,159 6,159 6,500 992 5 Insurance 1,678 168 1,845 1.734 11 - -

6 Property taxes 15,199 - 16.199 11,537 2.142 1,520 7 Health physics supplies - 5,352 1,338 6,690 6,90 - -

8 Heavy equipment rental 11,211 1.682 12.892 11,603 1,289 9 Small lool allowance 488 73 561 505 56 10 Pipe cutting equipment 913 137 1,050 1,050 -

11 Deown rig 1,186- 178 1,364 1,364 12 Disposal of DAW generated 1.224 50 4,765 1,321 7.360 7,360 17,249 40.613 13 Decommissioning Equipment Disposition 5 3 248 346 116 717 717 572 778 14 Plant energy budget 13,747 2,062 15,809 14,229 1,581 -

15 NRC Fees 2,466 247 2,712 2.712 -

16 Emergency Planning Fees 342 34 376 - 376 17 Site Security Cost 5,074 761 5.835 5,835 18 LLRW Processing Equipment 975 146 1.121 1.121 -

19 ISFSI Cask Purchases 18,400 2,760 21,160 - 21.160 20 Spent Fuel Pool O&M 3,665 550 4,214 4,214 2`1 Spent Fuel Transfer 11.670 1,751 13,421 13,421 Subtotal Undistributed Costs Period 2 3,906 19,156 1.694 772 7.831 73,560 15,190 122,108 76,238 41,424 4,446 17,821 6,500 42,383 Staff Costs DOC Staff Cost - - - 36,610 5,491 42,101 42,101 - - - -

UtilityStaff Cost --62,523 9,378 71,902 71,902 TOTAL PERIOD 2 15,485 48,136 13,044 3,744 64,114 198,527 69,925 412,975 361,536 41,424 10,015 135,763 9,917 459 1,467,957 PERIOD 3 Demolition of Remaining Site Buildings 35.1 Reactor 4,652 698 5.350 803 4,548 99,608 36.2 Diesel Generator 634 95 730 730 10.947 35.3 Fuel Handling 2.062 309 2,372 237 2,134 38,456 35.4 isul Valve Cubicle & Aux Fdwtr Stug Tnk 535 80 616 616 11,338 35.5 Mechanical & Electrical Auxiliary 4,943 741 5,685 568 5,116 92.031 35.6 Tank Pads & Foundations 234 35 269 269 6,163 35.7 Transformer Pads 251 38 288 288 6.370 T7l Services, Inc.

South Texas ProjectElectric GeneratingStation Document S30.1499-002,Rev. 0 DecommissioningCost Update Appendix A, Page 9 of 19 TABLE A-I SOUTH TEXAS PROJECT - UNIT 1 DECON, DECOMMISSIONING COST ESTIMATE (Thousands of 2004 Dollars)

Columns may not add due to rounding rounding Columns may not add due to NRC Spent Site LLW site GTCC Craft Labor IlNumbei Activitv Description Decon Remove Pack Shin Burial Other Continmenev Total LieTerm Fuel Mgt. Restor- A CF I CF V CF V CFW n.rs Demolition of Remaining Site Buildings (continued) 35.8 Turbine Generator 2,302 - -345 2,647 - 2,647 - - - - 67,161 35.9 Turbine Generator Pedestal 611 - - - -92 703 -703 - * - - 10.798 35 Totals 16,226 - -- 2.434 18,659 1,608 - 17.051 - - - - 342,872 Site Closeout Acilvties 36 Grade & landscape site 1,720 258 1.978 - 1,978 8,697 37 Final report to NRC 141 21 163 163 -

38 GTCC Disposal 15.427 2,314 17.741 17,741 679 Subtotal Period 3 Activity Costa 17.945 15,569 5,027 38,541 19.512 19,029 - 679 351,569 Period 3 Undtstrlbuted Costs 1 Insurance 465 46 511 511 -

2 Property taxes 3.166 - 3,166 1,210 1,956 3 Heavy equipment rental 3,331 500 3.831 - 3,831 4 Smal tool allowance 121 18 140 140 5 Plant energy budget 402 60 462 - 462 6 NRC ISFSI Fees 500 50 551 551 -

7 Emergency Planning Fees 193 19 .212 212 -

8 Site Security Cost 1,412 212 1,624 - 1,624 9 Spent Fuel Transfer 1.092 164 1,256 1,.256 Subtotal Undistributed Costs Period 3 3,452 7,230 1,070 11.752 3,740 8,012 Staff Costs DOC Staff Cost 5 0881 882 6,763 - 6,763

- - -2,760 UtilityStaff Cost 414 3,174 2,857 - 317 TOTAL PERIOD 3 21,398 31,440 7,393 60,231 22,369 3,740 34,122 - 679 351,569 TLG Services, Inc.

South Texas ProjectElectricGeneratingStation Document S30-1499-002, Rev. 0 DecommissioningCost Update Appendix A, Page10 of 19 TABLE A-1 SOUTH TEXAS PROJECT - UNIT 1 DECON, DECOMMISSIONING COST ESTIMATE (Thousands of 2004 Dollars)

Columnns may not add due to rounding NEC Spent Site LLW site GTCC Craft Labori INtumebe Activity Description Decon Remove Pack Ship Burial Other Contingency Total LibTerm Fuel Met. Restore A CF B CF C CF CF Hours TOTAL COST TO DECOMMISSION 17,316 71,249 13,918 4,301 68,258 367,806 99,302 642,151 501,057 95,834 45A260 139,794 16,907 459 679 1,831,604 Total cost to decommission with 18.29% oontingency'. $ 642,151,127 Total NRC license termination cost Is 78.03% or $ 501,057,150 Non-nuclear demolition cost Is 7.05% or $ 45,259,548 Spent Fuel Management 14.92% or $ 95,834,429 Total LLW site radwaste volume buried 157,160 cubic feet Total I0CFR61 greater than class C waste buried 679 cubic feet Total scrap metal released from South Texas Project Unit 1 33.033 tons Total craft labor requirements 1,831,604 person hours Note: V"Indicates costs less than $500 Note 1: This activity Is performed by the decommissioning staff following plant shutdown; the costs for this are Included In this period's staff cost.

Note 2: This activity, while performed after final plant shutdown, is considered part of operations and therefore no decommissioning costs are Included for this activity.

TLG Services, Inc.

South Texas ProjectElectricGeneratingStation Document S30-1499-002, Rev. 0 DecommissioningCost Update Appendix A, Page11 of 19 TABLE A-2 SOUTH TEXAS PROJECT - UNIT 2 DECON, DECOMMISSIONING COST ESTIMATE (Thousands of 2004 Dollars)

Columns may not add due to rounding iD NRC Spent Site LLW site GTCC Craft Labor Number Activity Description Decon Remove Pack Ship Burial Other Contingency Total LAcTerm Fuel Mgt Restore A CF B CF C CF CF Hours PERIOD I 1 Prepare preliminary decommissioning cost 50 8 68 58 2 Notification of Cessation of Operations Note 1 3 Remove fuel & source material Note 2 4 Notification of Permanent Defueling Note I 5 Deactivate plant systems & process waste Note 1 6 Prepare and submit PSDAR 78 12 89 89 7 Review plant dwgs & specs. 178 27 205 205 8 Perform detailed red survey Note 1 9 Estimate by-product Inventory 39 6 45 45 10 End product description 39 6 45 45 11 Detailed by-product Inventory 50 8 *58 58 12 Define major work sequence 291 44 334 334 13 Perform SER and EA 120 18 138 138 14 Perform Site-Specific Cost Study 194 29 223 223 15 Prepare/submit License Termination Plan 159 24 183 183 16 Receive NRC approval of termination plan Note I Acivity Specifications 17.1 Plant & temporary facilities 191 29 219 197 22 17.2 Plant systems 161 24 186 167 19 17.3 NSSS Decontamination Flush 19 3 22 22 17.4 Reactor Internals 275 41 316 316 17.5 Reactor vessel 252 38 290 290 17.6 Biological shield 19 3 22 22 17.7 Steam generators 121 18 139 139 17.8 Reinforced concrete 62 9 71 36 36 17.9 Turbine & condenser 31 5 36 36 17.10 Plant structures & buildings 121 18 139 70 70 17.11 Waste management 178 27 205 205 17.12 Facility & site closeout 35 5 40 20 20 17 Total 1.466 220 1,686 1,484 201 Planning & Site Preparations 18 Prepare dismantling sequence 93 14 107 107 19 Plant prep. & temp. svces 2,308 346 2,654 2,654 20 Design water clean-up system 54 a 62 62 21 Rlgglng/CCEsltooting/etc. 1,954 293 2,247 2,247 22 Procure casks/liners & containers 48 7 55 55 TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document 830-1499-002, Rev. 0 Decommissioning Cost Update Appendix A, Page12 off19 TABLE A-2 SOUTH TEXAS PROJECT - UNIT 2 DECON, DECOMMISSIONING COST ESTIMATE (Thousands of 2004 Dollars)

Columns may not add due to rounding ID NRC Spent Site LLW site GTCC Craft Laborl Number Activity Description Decon Remove Pack Ship Burial Other Contingencc Total LIcTerm Fuel Mgt Restore A CF B CF C CF CF Hour.

Detailed Work Procedures 23.1 Plant systems 183 28 211 190 21 23.2 NSSS Decontaminatlon Flush 39 6 45 45 23.3 Vessel head 97 15 111 ItI 23.4 Reactor internals 97 15 111 111 23.5 Remaining buildings 52 8 60 15 45 23.6 CRD cooling assembly 39 6 45 45 23.7 CRD housings & ICItubes 39 6 45 45 23.8 Incore instrumentation 39 6 45 45 23.9 Reactor vessel 141 21 162 162 23.10 Facility doseout 47 7 53 27 27 23.11 Missile shields 17 3 20 20 23.12 Biological shield 47 7 53 53 23.13 Steam generators 178 27 205 205 23.14 Reinforced concrete 39 6 45 22 22 23.15 Turbine & condensers 121 18 139 - 139 23.16 Auxiliary building 106 16 122 110 12 23.17 Reactor building 106 16 122 110 12 23 Total 1,385 208 1,593 1,314 279 24 Decon primary loop 987 494 1,481 1,481 800 Period I Additional Costs 25 Site Characterization Survey 1,692 508 2-200 2,200 26 Severance Plan 21,404 3,211 24,615 24,615 Subtotal Period 1 Activity Costs 987 31,602 5,488 38,076 37,596 480 800 Period I Undsrbilbuted Costs 656 1 Deaon equipment 98 754 754 2 Decon supplies 40 10 49 49 3 DOC staff relocation expenses 1,192 179 1,371 1,371 4 Process liquid waste 149 543 545 3,183 1,006 5,426 5,426 - 6,990 313 5 Insurance 1,715 171 1,886 581 1,305 6 Property taxes 6,139 6,139 5,561 578 7 Health physics supplies 249 62 311 311 -

8 Heavy equipment rental 274 41 316 316 9 Small tool allowance 0 0 0 0 10 Disposal of PAWgenerated 330 12 1,114 313 1,769 1,769 4,031 10,965 11 Plant energy budget 4,944 742 5,686 5.686 12 ISFSI Cask Purchase 10,400 1,560 11,960 - 11,960 13 ISFSI site alterations 4,124 619 4,742 - 4.742 TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document 830-1499-002, Rev. 0 DecommissioningCost Update Appendix A, Page 13 of19 TABLE A-2 SOUTH TEXAS PROJECT - UNIT 2 DECON, DECOMMISSIONING COST ESTIMATE (Thousands of 2004 Dollars)

Colunis may not add due to rounding ID NRC Spent Site LLW site GTCC Craft Labor Number Activity Description Decon Remove Pack Ship Burial Other Contingency Total LicTerm uel H, Restore A CF B CF C CF CF Hours Period I Undlstributed Costs (continued) 14 ISFSI transfer equipment 609 91 700 700 15 ISFSI licensing and permits 1,218 122 1,339 1.339 16 ISFSI O&M 70 7 77. 77 17 NRC Fees 572 57 629 029 18 Emergency Planning Fees 92 9 101 - 101 19 Site Security Cost 975 146 1,121 1,121 20 Spent Fuel Pool O&M 1,496 224 1,720 - 1,720 21 Spent Fuel Pool Isolation 5,572 83 6,408 6,408 22 Spent Fuel Transfer 2,997 449 3,446 - 3,446 Subtotal Undistributed Costs Period 1 844 1,716 874 557 4,297 40,923 6,744 55,954 23,576 32,378 4,031 6,990 11,278 Staff Costs DOC Staff Cost - - - 5.807 871 6,678 6,678 -

UbtlityStaff Cost - - 28,144 4,222 32.365 32.365

!TOTAL PERIOD I COST 1,831 1,716 874 857 4,297 106,475 17.324 133,074 100,216 32,378 480 4,031 8,990 12,078 PERIOD 2 Nuclear Steam Supply System Removal 27.1 Reactor Coolant Piping 98 190 12 16 590 248 1,153 1.153 1,361 10,880 27.2 Pressurizer Relief Tank 16 90 6 6 298 107 622 522 688 4,129 27.3 Reactor Coolant Pumps & Motors 53 44 35 29 2,426 652 3,237 3,237 5,596 4,115 27.4 Pressurizer 17 24 4 8 889 238 1,179 1,179 2,050 1,684 27.5 Steam Generators 223 3,157 2,058 947 9,115 3,422 4.041 22,964 22,964 21,027 24,566 27.6 Old Steam Generator Lower Sheo Units - 30 1,709 824 8,892 3,137 2.996 17,587 17,587 20,512 14.878 27.7 CRDMs/CIa/ServIce Structure Removal 76 53 74 16 1,605 462 2,287 2,287 3,703 4,717 27.8 Reactor Vessel Internals 66 2.047 5.503 494 4,771 5,453 18,335 18,335 2,003 788 459 29,692 27.9 Reactor Vessel 51 3,706 1.475 372 8,736 7.634 21,973 21.973 7,178 2Z629 29,692 27 Totals 601 9,341 10.875 2,709 37,323 6,559 21,830 89.238 89,238 64,119 3,417 459 124,353 28 Remove spent fuel racks 335 30 14 3 1,654 3,815 1,163 7,016 7,016 3,816 - - - 14,170 Removal of Major Equipment 29 Main Turbine/Generator - 73 11 84 84 3,298 30 Main Condensers 384 58 441 441 16,323 7L Services, Inc.

South Texas ProjectElectricGeneratingStation Document S30-1499-002, Rev. 0 DecommissioningCost Update Appendix A, Page14 of 19 TABLE A-2 SOUTH TEXAS PROJECT- UNIT 2 DECON, DECOMMISSIONING COST ESTIMATE (Thousands of 2004 Dollars)

Columns may not add due to rounding ID NRC Spent Site LLW site GTCC Craft Labor Number Activity Description Decon Remove Pack Ship Burial Other Contingency Total LicTerm Fuel Mgt Restore A CF B CF C CF CF Hours Disposal of Plant Systems 31.1 Auxiliary Feedwater (AF) - 61 9 70 70 2.852 31.2 Auxiliary Feedwater (AF) RCA 5 9 4 17 17 523 31.3 Auxiliary Steam & Boilers (AS) 84 13 97 97 3,985 31.4 Auxiliary Steam & Boilers (AS) RCA 3 5 2 9 9 286 31.5 BOP Chemdcal Feed (CF/AD/CA) 27 4 31 31 1,285 31.6 SOP Dlesal Generator (DB) 18 3 21 21 852 31.7 Bonn Recycle (BR) 312 12 7 575 125 243 1,273 1,273 1,326 11,843 31.8 Breathing Air (BA) 18 3 21 - 21 840 31.9 Breathing Air (BA) RCA 3 6 2 11 11 356 31.10 Chemical & Volume Control (CV) 614 638 19 11 988 128 736 3.134 3,134 2,278 46.284 31.11 Chilled Water HVAC (CH) 82 12 94 - 94 3,815 31.12 Chilled Water HVAC (CH) RCA 132 258 105 495 495 15,433 31.13 Circulating Water (CW) 385 58 443 - 443 18,541 31.14 Circulating Water Screen Wash (SC) 59 9 68 68 2,764 31.15 Closed Loop Auxiliary Cooling Water (AC) 53 8 61 61 2,541 31.16 Component Cooling Water (CC) RCA 279 293 184 756 756 24,485 31.17 Condensate (CD) 290 44 334 17 317 13,742 31.18 Condensate Polisher (CP) 131 20 150 150 6,112 31.19 Condensate Storage (CT) 31 5 36 36 1,429 31.20 Condenser Air Removal (CR) 31 5 35 35 1,456 31.21 Containment Building (XC) 725. 2 1 75 441 266 1,510 1,510 174 25,371 31.22 Containment Building HVAC (HC) 1,732 12 6 556 1.689 827 4,822 4,822 1,281 58,382 31.23 Containment Combustible Gas Control (CG) 24 0 0 2 13 8 47 47 4 933 31.24 Containment Hydrogen Monitoring (CM) 124 1 1 50 37 49 262 262 115 4,727 31.25 Containment Spray (CS) 50 39 31 119 74 45 3,712 31.26 Control Room HIAC (HB) Clean 81 12 93 - 93 3.671 31.27 Demineralizer Building HVAC (HW) 9 1 10 10 408 31.28 Demineralizer Water (DW) 208 31 239 239 9.631 31.29 Demlneralizer Water (DW) RCA 4 9 3 17 17 525 31.30 Diesel Generator Building (XG) 8 1 10 10 375 31.31 ECW & ECW Screen Wash (EW) 298 45 342 342 14,248 31.32 ECW & ECW Screen Wash (EW) RCA 84 143 63 290 290 9,058 31.33 Electrical Auxiliary Building (XE) 85 13 98 98 3,789 31.34 Electrical Auxiliary Building HVAC (HE) 189 28 217 217 8,538 31.35 Electrical Clean Non RCA 715 107 822 - 822 33,307 31.36 Electrical Clean RCA 320 1,331 360 2,012 2,012 63,735 31.37 Electrical Contaminated - 668 8 4 357 193 287 1,517 1,517 824 25,967 31.38 Electro-Hydraulic Controls (EH) 15 2 17 17 697 31.39 Essential Cooling Pond Makeup (EP) 23 3 26 26 1,075 31.40 Essential Cooling Pond Makeup (EP) RCA 23 41 17 81 81 2,479 31.41 Extraction Steam (ES) 84 13 96 96 4,027 TLG Services, Inc.

South Texas ProjectElectricGeneratingStation DocumentS30-1499-002, Rev. 0 DecomnissioningCost Update Appendix A, Page16 of 19 TABLE A-2 SOUTH TEXAS PROJECT - UNIT 2 DECON, DECOMMISSIONING COST ESTIMATE (Thousands of 2004 Dollars)

Columns may not add due to rounding ID NRC Spent Site LLW site GTCC Craft Labor Number Activity Description Decon Remove Pack Ship Burial Other Contingency Total LicTerm Fuel Mg Restore A CF B CF C CF CF Hours Disposal of Plant Systems (continued) 31.42 Feedwater(FW) 195 29 225 225 9,288 31.43 Feodwater (FW) RCA 7 12 5 24 24 755 31.44 Fire Protection (FP) 173 26 198 198 8,155 31.45 Fire Protection (FP) RCA 21 40 16 77 77 2,416 31.46 Fresh Water Supply (SW) 37 6 43 43 1.751 31.47 Fuel Handling Building (XF) 21 0 0 3 7 34 34 3 7 80O 31.48 Fuel Handling Building HVAC (HF) 1,027 3 1 129 836 415 2.411 2,411 297 35,438 31.49 Gas H2 Storage (HY) 1 0 1 34 31.50 Gas N2 High Pressure Supply (NH) 0 0 0 0 17 31.51 Gaseous Waste Processing (NG) 122 1 1 65 57 55 300 300 149 4,637 31.52 Generator CO2 & H2 (GG) 10 2 12 - 12 469 31.53 Generator Hydrogen Seat Oil (SO) 18 3 20 20 819 31.54 Heater Drip & Vent (HD/HV) 177 27 203 203 8,456 31.55 Hot Shop & Decontamination Fadcily (XN) 37 0 0 10 19 14 80 80 22 1,405 31.56 Instrument Air (IA) 134 20 155 - 155 6,353 31.57 Integrated Leak Rate Test (IL) 151 0 0 24 47 51 274 274 56 5,843 31.58 IsolaSton Valve Cubicle Building (XV) 4 1 5 5 183 31.59 Lighting Diesel Generator (DL) 5 1 6 6 233 31.60 Liquid Waste Processing (WL) 1,110 1,019 17 10 830 852 1,148 4,985 4,985 1,916 77.196 31.61 Low Pressure Nitrogan (NL) 41 6 47 - 47 1,967 31.62 Lube Oil Purification Strg &Tmsfr (LO) 36 6 41 41 1,674 31.53 MAB Plant Vent Header (VE) 322 2 1 86 281 144 836 836 198 10.791 31.64 Main Generator (GE/GM/NN) 13 2 15 15 583 31.65 Main Steam (MS) 191 29 220 220 9.155 31.66 Main Steam (MS) RCA 9 15 7 30 30 949 31.67 Main Turbine & Lube Oil (LT/TM) - 63 9 72 - 72 2908 31.68 Mechanical Auxiliary Bldg HVAC (HM) RCA 4,134 986 2,215 7,335 7.335 196,311 31.69 Mechanical Auxiliary Building (XM) - 235 0 0 9 60 70 375 375 22 8,852 31.70 Miscellaneous Drains (MD) 30 5 35 35 1,428 31.71 Miscellaneous HVAC (HZ) 113 17 131 131 5.175 31.72 Miscellaneous HVAC (HZ) RCA 78 17 41 136 136 3,633 31.73 Miscellaneous Reactor Coolant (RC) 699 31 16 1,430 168 563 2.907 2.907 3.298 27,237 31.74 Miscellaneous Yard Areas & Bldgs (XY) - 1,518 228 1.746 1,746 70.842 31.75 Nonradioactive Chemical Waste (NC) 79 12 91 - 91 3,734 31.75 Norvadloactlve Dms & Smps (DR) RCA 75 138 58 272 272 8,460 31.77 Nonradloactive Plumbing Dms & Smps (DR) 66 10 76 - 76 3,175 31.78 Oily Waste (OW) - 140 22 170 170 7,114 31.79 Open Loop Auxiliary Cooling (OC) 125 19 143 143 5,960 31.80 Plant Fuel Oil Storage & Transfer (FO) 41 6 47 47 1,921 31.81 Post Accident Monitor/Sample (AM/AP) 374 0 0 17 112 115 619 619 40 14,480 31.82 Potable Water (PW) 51 8 59 59 2,452 TLG Services, Inc.

South Texas Project ElectricGeneratingStation Document S30-1499-002, Rev. 0 Decommissioning Cost Update Appendix A, Page 16 of 19 TABLE A-2 SOUTH TEXAS PROJECT - UNIT 2 DECON, DECOMMISSIONING COST ESTIMATE (Thousands of 2004 Dollars)

Columns may not add due to rounding NRC Spent Site LLW site GTCC Craft Labor

'D I*

Decan . 1RAmn*A Remove Pack Ship Burial Other Contingency Total LicTerm Fuel Mgt Restore A CF B CF C CF CF Hoursl Number Activit Desert tion Disposal of Plant Systems (continued) 31.83 Potable Water (PW) RCA 12 25 10 46 46 1.496 31.84 Primary Process Sampling (PS) - . 40 0 0 10 12 14 77 77 23 1,531 31.85 Radiation Monitoring (RA) 8 " 56 12 77 12 65 - 2,885 31.86 Radioactive Vents & Drains (ED) 772 718 14 7 648 111 747 3,019 3,019 1,496 54,381 31.87 Reactor Coolant Pump Oil Change-Out (PO) 13 0 0 5 26 8 63 53 12 500 31.88 Reactor Head Degassing (RO) 63 1 1 67 31 37 201 201 156 2,395 31.89 Reactor Makeup Water (RM) 290 2 1 88 252 132 765 765 202 11.207 31.90 Residual Heat Removal (RH) 345 31 17 1,527 166 499 2,585 2,585 3,523 13,478 31.91 SO Sludge Lancing & Chem Cleaning (SL) 0 0 0 - 0 - 8 31.92 Safety Injection (SI) 1,198 65 36 3.153 1,086 1,262 6,798 6.798 7,274 46,584 31.03 Secondary Process Sampling (SS) 26 4 30 - 30 - 1,212 31.94 Service Air (SA) 82 12 94 94 3.902 31.95 Service Water (TW) 45 7 52 - - 52 2,145 31.96 Sewage Treatment (ST) 50 7 57 57 2.412 31.97 Sodium Hypochlorite (SH) 81 12 93 93 - 3,787 31.98 Solid Waste Processing (WS) 41 38 1 1 60 25 49 215 215 139 2,978 31.99 Spent Fuel Pool Cooling & Cleanup (FC) 311 20 11 952 235 355 1,883 1,883 2,197 12,108 31.100 Standby DG Fuel Oil Strg & Tmsfr (DO) 26 4 30 - 30 - 1,166 31.101 Standby Diesel Gen Starting Air(SD) 12 2 13 13 534 31.102 Standby Diesel Generator (DG) 82 12 94 94 3,831 31.103 Standby Diesel Generator Bldg HWAC(HG) 57 9 66 66 2,595 31.104 Standby Diesel Generator Lube Oil (LU) 3 0 3 3 124 31.105 Standby Diesel Jacket Water (JW) 3 0 4 4 146 31.106 Stator Cooling Water (GC) 4 1 4 4 175 31.107 Steam Generator Blowdown (SB) 40 6 46 - 46 1,907 31.108 Steam Generator Blowdown (SB) RCA 23 43 18 84 84 2,618 31.109 Turbine Generator Building (XT) 77 12 89 - 89 3,516 31.110 Turbine Generator Building HVAC (HT) 217 33 249 249 9.786 31.111 Turbine Gland Seal (GS) 20 3 22 22 903 31.112 Well Water Supply (WW) 188 28 216 - 216 8,883 31 Totals 7,805 21,974 241 134 11,718 7,005 12,347 61,225 62,776 8,449 27.031 1,186.227 Decontamination of Site Buildings 32.1 Reactor 795 466 111 64 3.314 632 1.458 6,840 6.840 - 11,820 46,051 32.2 Fuel Handling 463 411 42 22 1.104 364 673 3,079 3,079 3,778 32,978 32.3 Mechanical & Electrical Auxiliary 847 103 67 39 1,048 291 767 3.163 3,163 7,345 33,545 32 Totals 1.729 805 181 103 8.581 901 2,898 13,082 13,082 22,943 112,574 33 Terminate license Note 1 TW Services, Ine.

South Texas ProjectElectric GeneratingStation Document 830-1499-002, Rev. 0 Decommissioning Cost Update Appendix A, Page 17 of19 TABLE A-2 SOUTH TEXAS PROJECT - UNIT 2 DECON, DECOMMISSIONING COST ESTIMATE (Thousands of 2004 Dollars)

Columns may not add due to rounding iD NRC Spent Site LLW site GTCC Craft Labor Number Activity Description Decon Remove Pack Ship Burial Other Contingency Total LieTerm Fuel Mgt Restore A CF B CF C CF CF Hours Period 2 Additional Costs 34 Ucense Termination Survey 7,875 2.362 10,237 10,237 121.892 Subtotal Period 2 Activity Costs 10.470 32,607 11.312 2,949 59,278 26,155 40.670 181,323 172,349 8,974 117,909 3.417 459 1,578,837 Period 2 Undistributed Costs 1 Decon equipment 656 - - - - 98 754 754 1,198 - 299 1,497 1,497 2 Decon supplies 3 DOC staff retocaton expenses 1,192 - 179 1,371 1,371 4 Process liquid waste 861 458 710 2,776 - 1,277 6,082 6.082 6,405 984 1,681 168 111 5 Insramnce - 1,849 1,738 6 Property taxes 13,808 13,808 10,280 2,147 1,381 7 Health physics supplies 5,801 1,450 7,251 7,251 11,238 1,686 12.923 11,631 1,292 -

8 Heavy equipment rental 9 Small tool allowance 533 80 613 552 611 10 Pipe cutting equipment 913 137 1,050 1.050 11 Decon rig 1,186 178. 1,364 1.364 12 Disposal of DAW generated 1,227 51 4,836 - 1,339 7,462 7,452 17.505 40,711 13 Decommissioning Equipment Disposition 5 3 248 405 124 786 786 572 778 14 Plant energy budget 19.206 2,881 22,087 19,878 2.209 -

15 ISFSI O&M 392 39 431 - 431 16 NRC Fees 2.472 247 2.719 2,719 17 Emergency Planning Fees 342 34 377 - 377 18 Site Security Cost 7.878 1,182 9,059 8,606 453 19 LLRW Processing Equipment 927 139 1,060 1,066 20 ISFSI Cask Purchase 30.400 4.560 34,960 34,960 21 Spent Fuel Pool O&M 3.662 549 4,211 4,211 22 Spent Fuel Transfer 11.714 1,757 13,471 13,471 Subtotal Undtabibuted Costs Period 2 3.901 19,878 1,690 764 7,860 92,886 18,404 146,180 84,076 56,161 4,943 18.077 6,405 42,473 Staff Costs 46.653 6,998 53,651 53,651 DOC Staff Cost UtilityStaff Cost 81,652 12,248 93,900 91,265 2.635 TOTAL PERIOD 2 14,371 52,284 13,002 3,712 67,136 247,346 78,319 474,054 401,340 58,796 13,917 135,986 9,822 459 1,621.310 TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499-002, Rev. 0 DecommissioningCost Update Appendix A, Page 18 of 19 TABLE A-2 SOUTH TEXAS PROJECT - UNIT 2 DECON, DECOMMISSIONING COST ESTIMATE (Thousands of 2004 Dollars)

Columns may not add due to rounding ID NRC Spent Site LLW site GTCC Craft Laborl Number Activity Description Decon Remove Pack Ship Burial Other Contingenc5 Total LieTerm Fuel M Restore A CF B CF C CF CIF Hours PERIOD 3 Demolition of Remaining Site Buildings 35.1 Reactor 4,652 698 5.350 803 4,548 99,608 35.2 Basins 85 13 98 98 1.021 35.3 Circulating Water Intake & Discharge 3,985 598 4,583 4.583 53.943 35.4 Diesel Generator 634 95 730 730 10.947 35.5 Essential Cooling Pond/Intake/Discharge 639 96 735 735 10,712 35.6 Fuel Handling 2,062 309 2,372 237 2.134 38,456 35.7 Isol Valve Cubicle & Aux Fdwtr Strg Tnk 535 80 616 616 11,338 35.8 Maintenance Operations Facility 376 56 432 432 8,479 35.9 Mechanical & Electrical Auxiliary 4.943 741 5,685 568 5.116 92,031 35.10 Miscellaneous Slabs, Foundations & Pads 913 137 1,050 1,050 19,844 35.11 Miscellaneous Yard Buildings 1,995 299 2,295 2,295 44,016 35.12 Nuclear Support Center 486 73 558 558 11,701 35.13 Nuclear Training Facility& Annex 282 42 324 324 7.203 35.14 Sewage Treatment Plant 56 8 65 65 671 35.15 Steam Generator Mausoleum 266 40 305 305 4,131 35.16 Tank Pads & Foundations 235 35 270 270 6,183 35.17 Transformer Pads 263 40 303 303 6,678 35.18 Trenches & Culverts 1,122 168 1.290 1.290 25.578 35.19 Turbine Generator 2.302 345 2,647 2.647 67,161 35.20 Turbine Generator Pedestal 611 92 703 703 10,798 35.21 Warehouses 2.316 347 2,664 2.664 45.588 3522 Yard Piping 91 14 105 105 1,279 35 Totals 28,852 4,328 33,180 1,608 31.572 577.366 Site Closeout Activities 36 Remove Rubble 1,184 178 1,361 1,361 - - - - 2.326 37 Grade & landscape site 2,497 375 2,872 2,872 - - - . 12,627 38 Final report to NRC 60 9 70 70 -

Period 3 Additional Costs 39 ISFSI License Termination 2.449 161 70 5,385 2,607 2,376 13,049 13,049 12,422 63,467 40 ISFSI Demolition and Site Restoration 1,503 270 416 2,190 2,190 6.701 41 Firing Range Restoration 8 17 49 16 90 90 42 Reservoir Restoration 22,162 3,324 25,486 26,486 43 GTCC Disposal 15,427 2,314 17,741 17,741 679 Subtotal Period 3 Activity Costa 36,493 161 87 20,861 25,100 13,336 96,039 19,419 15.239 61,381 12,422 - 679 662,488 T7W Services, Inc.

C South Texas ProjectElectricGeneratingStation DocumentS30-1499-002, Rev. 0 Decommissioning Cbst Update Appendix A, Page19 of 19 TABLE A-2 SOUTH TEXAS PROJECT - UNIT 2 DECON, DECOMMISSIONING COST ESTIMATE (Thousands of 2004 Dollars)

Columns may not add due to rounding ID NRC Spent Site LLW site GTCC Craft Laborl Number Activity Description Decon Remove Pack Ship Burial Other Contingency Total LieTerm Fuel Mgt Restore A CF B CF C CF CF Hours Period 3 Undistributed Costs 1 Insurance 1,671 167 1,838 1,838 -

2 Property taxes 9,341 9,341 8,800 741 3 Heavy equipment rental 3,331 - 500 3,831 - 3,831 4 Small tool allowance 202 - 30 232 232 5 Plant energy budget 1,025 154 1,179 - 1,179 6 ISFSI O&M 825 124 948 948 -

7 NRC ISFSI Fees 3,558 356 3,914 3,914 8 Emergency Planning Fees 1,331 133 1.464 1,464 -

9 Site Security Cost 6,735 1,010 7.746 7,228 518 10 Spent Fuel Transfer 7.843 1,176 9.019 9,019 -

Subtotal Undistributed Costs Period 3 3.533 32.329 3,650 39,512 33,011 6,501 Staff Costs DOC Staff Cost 9,985 1,498 11,482 - 11,482 UtilityStaff Cost 20,118 3.018 23.135 3,928 16,894 2,314 TOTAL PERIOD 3 - 40,026 161 87 20,861 87,531 21 501 170,169 23,347 65,144 81,678 12,422 6-79 662,488 TOTAL COST TO DECOMMISSION 16,202 94,026 14,037 4,356 92,294 441,352 117,145 777,297 524,904 156,318 96,075 152,439 16,812 459 679 2,295,875 Total cost to decommission with 17.75% contingency $ 777,296,8946 Total NRC license termination cost is 67.53% or $ 524,903,585 Non-nuclear demolition cost is 12.36% or $ 96,075,107 Spent Fuel Management 20.11% $ 156,318,253 169,710 cubic feet Total LLWsite radwasta volume buried Total I0CFR61 greater than class C waste buried 679 cubic feet Total scrap metal released from South Texas Prole ct Unit 2 40,869 tons Total craft labor requirements 2,295,875 person hours Note: "0" indicates costs less than $500 Note 1: This activity Is performed by the decommissioning staff following plant shutdown; the costs for this are Included in this period's staff cost.

Note 2: This activity, while performed after final plant shutdown, is considered part of operations and therefore no decommissioning costs ere included for this activity.

TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499-002, Rev. 0 DecommissioningCost Update Appendix B, Page 1 of 9 APPENDIX B CO-OWNER SCHEDULE OF ANNUAL EXPENDITURES DECON Alternative Page Texas Genco, LP - Unit 1 ............................................................................................. B-2 Texas Genco, LP - Unit 2 .............................................................................................. B-3 AEP Texas Central Co. - Unit 1 .................................................................................. B-4 AEP Texas Central Co. - Unit 2 .............................................................................. B-5 CPS - Unit 1 .................................................................................................................. B-6 CPS - Unit 2 .................................................................................................................. B-7 COA - Unit l ........................................................................................................... B-8 COA - Unit 2 .................................................................................................................. B-9 TLG Services,Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499.002, Rev. 0 DecommissioningCost Update Appendix B, Page 2 of 9 TABLE B-l.a TEXAS GENCO, LP - SCHEDULE OF ANNUAL EXPENDITURES DECON Alternative - Unit 1 (2004 Dollars, 10% Contingency)

Period 3 Period 1 Period 2 Site Site Year Planning Decommissioning Restoration Restoration Total Offset 2027 11,866,676 0 0 0 11,866,676 2028 33,795,520 0 0 0 33,795,520 2029 4,446,988 27,069,260 0 0 31,516,247 2030 0 28,222,431 0 0 28,222,431 2031 0 23,455,482 0 0 23,455,482 2032 0 22,827,410 0 0 22,827,410 2033 0 18,835,127 0 0 18,835,127 2034 0 2,078,759 247,897 0 2,326,656 2035 0 0 793,217 0 793,217 2036 0 0 19,407 6,262,589 6,281,996 2037 0 0 0 5,279,187 5,279,187 2038 0 0 0 0 0 2039 0 0 0 0 0 2040 0 0 0 0 0 2041 0 0 0 0 0 2042 0 0 0 0 0 2043 0 0 0 0 0 2044 0 0 0 0 0 2045 0 0 0 0 0 2046 0 0 0 0 0 2047 0 0 0 5,262,074 5,262,074 2048 0 0 0 0 0 50,109,184 122,488,469 1,060,520 16,803,851 190,462,024 TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499-002, Rev. 0 DecommissioningCost Update Appendix B, Page3 of 9 TABLE B-l.b TEXAS GENCO, LP - SCHEDULE OF ANNUAL EXPENDITURES DECON Alternative - Unit 2 (2004 Dollars, 10% Contingency)

Post Decommissioning ISFSI Operations Period 1 Period 2 Site Spent Fuel ISFSI Year Planning D&D Restoration Transfer 'D&D Total 2028 1,303,315 0 0 0 0 1,303,315 2029 26,600,662 0 0 0 0 26,600,662 2030 11,565,870 21,175,059 0 0 0 32,740,929 2031 0 30,894,125 0 0 0 30,894,125 2032 0 27,769,217 0 0 0 27,769,217 2033 0 26,922,988 0 0 0 26,922,988 2034 0 23,623,247 0 0 0 23,623,247 2035 0 10,093,723 0 0 0 10,093,723 2036 0 126,006 14,998,503 0 0 15,124,510 2037 0 0 12,643,318 224,017 0 12,867,335 2038 0 0 0 1,277,599 0 1,277,599 2039 0 0 0 1,277,599 0 1,277,599 2040 0 0 0 1,281,099 0 1,281,099 2041 0 0 0 1,277,599 0 1,277,599 2042 0 0 0 1,277,599 0 1,277,599 2043 0 0 0 1,277,599 0 1,277,599 2044 0 0 0 1,281,099 0 1,281,099 2045 0 0 0 1,277,599 0 1,277,599 2046 0 0 0 1,277,599 0 1,277,599 2047 0 0 0 6,214,148 3,170,564 9,384,712 2048 0 0 0 0 1,716,125 1,716,125 2049 0 0 0 0 0 0 39,469,846 140,604,365 27,641,821 17,943,553 4,886,689 230,546,274 TLG Services,Inc.

South Texas ProjectElectric GeneratingStation Document 830-1499-002, Rev. 0 DecommissioningCost Update Appendix B, Page4 of 9 TABLE B-2.a AEP TEXAS CENTRAL CO. - SCHEDULE OF ANNUAL EXPENDITURES DECON Alternative - Unit 1 (2004 Dollars, 10% Contingency)

Period 3 Period 1 Period 2 Site Site Year Planning Decommissioning Restoration Restoration Total Offset 2027 9,706,189 0 0 0 9,706,189 2028 27,642,593 0 0 0 27,642,593 2029 3,637,354 22,140,939 0 0 25,778,293 2030 0 23,084,160 0 0 23,084,160 2031 0 19,185,097 0 0 19,185,097 2032 0 18,671,375 0 0 18,671,375 2033 0 15,405,940 0 0 15,405,940 2034 0 1,700,293 202,764 0 1,903,057 2035 0 0 648,801 0 648,801 2036 0 0 15,873 5,122,401 5,138,275 2037 0 0 0 4,318,041 4,318,041 2038 0 0 0 0 0 2039 0 0 0 0 0 2040 0 0 0 0 0 2041 0 0 0 0 0 2042 0 0 0 0 0 2043 0 0 0 0 0 2044 0 0 0 0 0 2045 0 0 0 0 0 2046 0 0 0 0 0 2047 0 0 0 4,304,043 4,304,043 2048 0 0 0 0 0 40,986,136 100,187,804 867,438 13,744,485 155,785,863 TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499-002, Rev. 0 Decommissioning Cost Update Appendix B, Page5 of 9 TABLE B-2.b AEP TEXAS CENTRAL CO. - SCHEDULE OF ANNUAL EXPENDITURES DECON Alternative - Unit 2 (2004 Dollars, 10% Contingency)

Post Decommissioning ISFSI Operations Period 1 Period 2 Site Spent Fuel ISFSI Year Planning D&D Restoration Transfer D&D Total 2028 1,066,029 0 0 0 0 1,066,029 2029 21,757,655 0 0 0 0 21,757,655 2030 9,460,149 17,319,856 0 0 0 26,780,004 2031 0 25,269,436 0 0 0 25,269,436 2032 0 22,713,460 0 0 0 22,713,460 2033 0 22,021,298 0 0 0 22,021,298 2034 0 19,322,319 0 0 0 19,322,319 2035 0 8,256,026 0 0 0 8,256,026 2036 0 103,065 12,267,825 0 0 12,370,890 2037 0 0 10,341,433 183,232 0 10,524,664 2038 0 0 0 1,044,995 0 1,044,995 2039 0 0 0 1,044,995 0 1,044,995 2040 0 0 0 1,047,858 0 1,047,858 2041 0 0 0 1,044,995 0 1,044,995 2042 0 0 0 1,044,995 0 1,044,995 2043 0 0 0 1,044,995 0 1,044,995 2044 0 0 0 1,047,858 0 1,047,858 2045 0 0 0 1,044,995 0 1,044,995 2046 0 0 0 1,044,995 0 1,044,995 2047 0 0 0 5,082,779 2,593,320 7,676,099 2048 0 0 0 0 1,403,681 1,403,681 2049 0 0 0 0 0 0 32,283,833 115,005,459 22,609,257 14,676,689 3,997,002 188,572,239 MG Services, Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499-002, Rev. 0 DecommissioningCost Update Appendix B, Page 6 of 9 TABLE B-3.a CPS - SCHEDULE OF ANNUAL EXPENDITURES DECON Alternative - Unit 1 (2004 Dollars, 10% Contingency)

Period 3 Period 1 Period 2 Site Site Year Planning Decommissioning Restoration Restoration Total Offset 2027 9,794,209 0 0 0 9,794,209 2028 27,893,268 0 0 0 27,893,268 2029 3,670,339 22,341,722 0 0 26,012,061 2030 0 23,293,497 0 0 23,293,497 2031 0 19,359,076 0 0 19,359,076 2032 0 18,840,695 0 0 18,840,695 2033 0 15,545,648 0 0 15,545,648 2034 0 1,715,712 204,602 0 1,920,315 2035 0 0 654,685 0 654,685 2036 0 0 16,017 5,168,853 5,184,871 2037 0 0 0 4,357,198 4,357,198 2038 0 0 0 0 0 2039 0 0 0 0 0 2040 0 0 0 0 0 2041 0 0 0 0 0 2042 0 0 0 0 0 2043 0 0 0 0 0 2044 0 0 0 0 0 2045 0 0 0 0 0 2046 0 0 0 0 0 2047 0 0 0 4,343,074 4,343,074 2048 0 0 0 0 0 41,357,816 101,096,350 875,305 13,869,126 157,198,596 TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499-002, Rev. 0 DecommissioningCost Update Appendix B, Page 7 of 9 TABLE B-3.b CPS - SCHEDULE OF ANNUAL EXPENDITURES DECON Alternative - Unit 2 (2004 Dollars, 10% Contingency)

Post Decommissioning ISFSI Operations Period 1 Period 2 Site Spent Fuel ISFSI Year Planning D&D Restoration Transfer D&D Total 2028 1,075,696 0 0 0 0 1,075,696 2029 21,954,963 0 0 0 0 21,954,963 2030 9,545,937 17,476,920 0 0 0 27,022,857 2031 0 25,498,590 0 0 0 25,498,590 2032 0 22,919,435 0 0 0 22,919,435 2033 0 22,220,996 0 0 0 22,220,996 2034 0 19,497,542 0 0 0 19,497,542 2035 0 8,330,895 0 0 0 8,330,895 2036 0 104,000 12,379,075 0 0 12,483,075 2037 0 0 10,435,213 184,894 0 10,620,107 2038 0 0 1,054,471 0 1,054,471 2039 0 0 1,054,471 0 1,054,471 2040 0 0 0 1,057,360 0 1,057,360 2041 0 0 0 1,054,471 0 1,054,471 2042 0 0 0 1,054,471 0 1,054,471 2043 0 0 0 1,054,471 0 1,054,471 2044 0 0 0 1,057,360 0 1,057,360 2045 0 0 0 1,054,471 0 1,054,471 2046 0 0 0 1,054,471 0 1,054,471 2047 0 0 0 5,128,872 2,616,837 7,745,709 2048 0 0 0 0 1,416,411 1,416,411 2049 0 0 0 0 0 0 32,576,596 116,048,377 22,814,288 14,809,783 4,033,248 190,282,292 TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499-002, Rev. 0 Decommissioning Cost Update Appendix B, Page 8 of 9 TABLE B-4.a COA - SCHEDULE OF ANNUAL EXPENDITURES DECON Alternative - Unit 1 (2004 Dollars, 10% Contingency)

Period 3 Period 1 Period 2 Site Site Year Planning Decommissioning Restoration Restoration Total Offset 2027 5,597,262 0 0 0 5,597,262 2028 15,940,638 0 0 0 15,940,638 2029 2,097,551 12,768,002 0 0 14,865,553 2030 0 13,311,929 0 0 13,311,929 2031 0 11,063,459 0 0 11,063,459 2032 0 10,767,211 0 0 10,767,211 2033 0 8,884,135 0 0 8,884,135 2034 0 980,507 116,928 0 1,097,435 2035 0 0 374,144 0 374,144 2036 0 0 9,154 2,953,932 2,963,086 2037 0 0 0 2,490,082 2,490,082 2038 0 0 0 0 0 2039 0 0 0 0 0 2040 0 0 0 0 0 2041 0 0 0 0 0 2042 0 0 0 0 0 2043 0 0 0 0 0 2044 0 0 0 0 0 2045 0 0 0 0 0 2046 0 0 0 0 0 2047 0 0 0 2,482,010 2,482,010 2048 0 0 0 0 0 23,635,451 57,775,242 500,225 7,926,024 89,836,943.

TLG Services, Inc.

South Texas ProjectElectric GeneratingStation Document S30-1499-002, Rev. 0 DecommissioningCost Update Appendix B, Page9 of 9 TABLE B-4.b COA - SCHEDULE OF ANNUAL EXPENDITURES DECON Alternative - Unit 2 (2004 Dollars, 10% Contingency)

Post Deconmmissioning ISFSI Operations Period 1 Period 2 Site Spent Fuel ISFSI Year Planning D&D Restoration Transfer D&D Total 2028 614,746 0 0 0 0 614,746 2029 12,546,974 0 0 0 0 12,546,974 2030 5,455,378 9,987,831 0 0 0 15,443,209 2031 0 14,572,111 0 0 0 14,572,111 2032 0 13,098,157 0 0 0 13,098,157 2033 0 12,699,009 0 0 0 12,699,009 2034 0 11,142,590 0 0 0 11,142,590 2035 0 4,760,998 0 0 0 4,760,998 2036 0 59,435 7,074,479 0 0 7,133,914 2037 0 0O 5,963,588 105,664 0 6,069,252 2038 0 0 0 602,616 0 602,616 2039 0 0 0 602,616 0 602,616 2040 0 0 0 604,267 0 604,267 2041 0 0 0 602,616 0 602,616 2042 0 0 0 602,616 0 602,616 2043 0 0 0 602,616 0 602,616 2044 0 0 0 604,267 0 604,267 2045 0 0 0 602,616 0 602,616 2046 0 0 0 602,616 0 602,616 2047 0 0 0 2,931,083 1,495,488 4,426,572 2048 0 0 0 0 809,460 809,460 2049 0 0 0 0 0 .0 18,617,099 66,320,131 13,038,067 8,463,598 2,304,949 108,743,843 TLG Services, Inc.