[Federal Register Volume 59, Number 39 (Monday, February 28, 1994)]
[Unknown Section]
[Page ]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-4455]


[Federal Register: February 28, 1994]


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NUCLEAR REGULATORY COMMISSION
[Docket No. 50-267]


Public Service Company of Colorado; Fort St. Vrain Nuclear 
Generating Station

Exemption

I

    The Public Service Company of Colorado (PSC or the licensee) is the 
holder of Possession-Only License (POL) No. DPR-34, which authorizes 
possession and maintenance of the Fort St. Vrain Nuclear Generating 
Station (FSV). The license provides, among other things, that the plant 
is subject to all rules, regulations, and Orders of the U.S. Nuclear 
Regulatory Commission now or hereafter in effect.
    FSV is a high-temperature, gas-cooled reactor that is located at 
the licensee's site in Weld County, Colorado. FSV operated from January 
31, 1974, to August 18, 1989. PSC shut down FSV due to control rod 
drive failures, and subsequently made the shut down permanent due to a 
discovery of degradation of the steam generator ring headers. On 
November 5, 1990, PSC submitted a Decommissioning Plan (DP) pursuant to 
10 CFR 50.82 that proposed dismantling of FSV. On May 21, 1991, the NRC 
revised License No. DPR-34 to POL that allows possession but not 
operation of FSV. The DP was approved by NRC Order dated November 23, 
1993. PSC is activately dismantling FSV. In addition, FSV has been 
defueled and all fuel was transferred to the PSC Independent Spent Fuel 
Storage Installation (ISFSI) The ISFSI is licensed under 10 CFR part 
72.

II

    By letter dated February 25, 1993, the licensee requested a 
reduction in their primary financial coverage and an exemption from 
participation in the industry retrospective rating plan for secondary 
level coverage as required in 10 CFR 140.11(a)(4).

III

    The justification presented by the licensee for the exemption 
request is that FSV is not authorized to operate, all nuclear fuel has 
been removed from the reactor facility and transferred to the ISFSI, 
and the risk of accidents resulting in a radiological release is now 
considerably less than during plant operation. The licensee contends 
that, with all nuclear fuel removed from the reactor facility, the 
potential accidents as evaluated in the FSV DP only involve events such 
as fires, electrical power outages, and the dropping of activated or 
contaminated materials during dismantling. PSC concludes that these 
events result in doses to an individual located at the emergency 
planning zone boundary that are orders of magnitude below 10 CFR part 
100 guidelines, and are a small fraction of U.S. Environmental 
Protection Agency's ``Protective Action Guidelines.'' The NRC staff 
Safety Evaluation of the FSV DP (NRC Decommissioning Order dated 
November 23, 1992) confirmed the PSC conclusion.
    Because the possession-only license and the decommissioning order 
prohibits operation of FSV, and all spent fuel has been transferred 
from the reactor, the licensee contended that FSV is outside the ambit 
of 10 CFR 140.11(a)(4) and that 10 CFR 140.12 applies with its minimum 
requirement of $4,500,000 for financial protection.
    Therefore, the licensee indicated that it believed that reduced 
financial protection is warranted and that $50,000,000 in primary 
financial protection provides adequate coverage for liability stemming 
from any potential accident. PSC also cited the FSV DP to demonstrate 
that there were no credible accidents associated with FSV that are 
comparable, in consequence or severity, to the design basis accidents 
of an operating facility. PSC concluded that the requested $50,000,000 
in primary financial protection insurance coverage is adequate for any 
fire, accident, or other hazardous event that could credibly occur 
while decommissioning FSV.
    PSC concluded that the requirement for secondary insurance only 
applies to plants licensed to operate and is not applicable to FSV. PSC 
stated that it should not be unfairly burdened with financial liability 
at another nuclear facility because potential damages from an accident 
at FSV are reduced to the extent that it could not benefit from the 
secondary protection. The NRC staff independently evaluated the legal 
and technical issues associated with the application of the Price-
Anderson Act to permanently shutdown reactors in SECY-93-127, 
``Financial Protection Required of Licensees of Large Nuclear Power 
Plants During Decommissioning,'' May 10, 1993. In this evaluation, the 
staff concluded that the NRC has discretionary authority to respond to 
licensee requests for reduction in the level of primary financial 
protection and withdrawal from participation in the industry 
retrospective rating plan. Lastly, the staff concluded that accidents 
and hazards insured against under Price-Anderson go beyond design basis 
accidents and beyond those considered ``credible'' as that term is used 
in 10 CFR part 100 and in interpreting the application of that 
regulation. The Commission issued a Staff Requirements Memorandum (SRM) 
based on SECY-93-127 on July 13, 1993. In the SRM, the Commission 
approved the staff's recommendation to permit, through the exemption 
process, a reduction of primary level coverage to $100,000,000 and a 
withdrawal from participation in the secondary financial protection 
layer.
    In the exercise of its discretionary authority, the NRC may, so 
long as a potential hazard exists at a permanently shutdown reactor, 
require the full amount of primary financial protection and full 
participation in the industry retrospective rating plan. At such time 
that the hazard is determined to no longer exist, the NRC may reduce 
the amount of primary financial protection and permit the licensee to 
withdraw from participation in the industry retrospective rating plan.
    Since the legislative history does not explicitly consider the 
potential hazards that might exist after termination of operation, the 
staff generically evaluated the offsite consequences associated with 
normal and abnormal operations, design basis accidents, and beyond 
design basis accidents for reactors that have been permanently defueled 
and shutdown. The staff concluded that, aside from the handling, 
storage, and transportation of radioactive materials, no reasonably 
conceivable potential accident exists at FSV that could cause 
significant offsite damage.
    A severe transportation accident could potentially result in local 
contamination requiring cleanup and offsite liabilities resulting from 
traffic disruption and loss of use. This type of accident would warrant 
maintaining some level of liability insurance.
    The most significant accident sequence for a permanently defueled 
and shut down reactor with no fuel onsite involves a fire or the 
dropping of contaminated or activated components during decommissioning 
operations.
    The NRC staff independently evaluated the legal and technical 
justifications for the exemption presented by PSC. The NRC recognizes 
that FSV is: (1) Permanently shutdown; (2) defueled; (3) licensed with 
``possession only'' status under a decommissioning order and an amended 
license that does not permit fuel at the reactor facility; and (4) 
actively being dismantled. The staff concurred with the PSC's 
evaluation of credible accidents at FSV and their minimal associated 
offsite consequences. The licensee identified need for continuing 
liability coverage, $50,000,000, was limited to liability stemming from 
any fire, accident, or other hazardous events. However, coverage needs 
associated with transportation of radioactive materials or 
precautionary evacuations were not identified. Although the licensee 
presented legal views and opinions regarding the applicability of 10 
CFR 140.12 versus 10 CFR 140.11(a)(4), the staff did not concur with 
these legal views and opinions.
    The licensee also contended that compliance with existing 
regulations would result in potential payment of retrospective 
assessments under the secondary indemnity plan and payments of 
insurance premiums under the primary financial protection plan. These 
payments would constitute an ``unfair burden'' to the licensee and its 
ratepayers. The staff recognizes that relief from financial protection 
requirements is warranted because the potential hazards and 
consequences associated with a permanently shut down reactor with no 
spent fuel are greatly reduced, and that a permanently shut down 
reactor does not contribute a level of risk to the participants in the 
secondary pool proportionate to that of an operating reactor.
    The staff, on its own initiative, did consider liability coverage 
needs associated with decommissioning activities and transportation of 
radioactive materials. The results of our evaluation, as embodied in 
the July 13, 1993, SRM, based on SECY-93-127, allow a reduction in the 
amount of financial protection required of licensees of large nuclear 
plants that have been prematurely shut down. FSV meets the criterion 
established in SECY-93-127 for relief from financial protection 
requirements.
    Although the licensee requested a new primary financial protection 
coverage level of $50,000,000, the staff has also concluded that claims 
settlement experience at the Three Mile Island Unit 2 (TMI-2) (an 
accident which did not result in a significant release of 
radioactivity) provides a reasonable basis for establishing the 
appropriate level of primary insurance coverage. Because TMI-2 claims 
have reached $60,000,000 and a large number of TMI-2 claims are still 
unsettled, the staff concluded that a level of $100,000,000 for primary 
financial protection coverage is warranted. This level of primary 
insurance coverage is consistent with the SRM dated July 13, 1993.

IV

    The staff, based on its independent evaluation as embodied in the 
July 13, 1993, SRM on SECY-93-127 ``Financial Protection Required of 
Licensees of Large Nuclear Power Plants During Decommissioning,'' has 
concluded that sufficient bases exist for our approval of relief from 
the financial protection requirements for the FSV. The staff has also 
concluded that granting the proposed exemption does not increase the 
probability or consequences of any accidents or reduce the margin of 
safety at this facility.

V

    Based on Sections III and IV above, the NRC has determined, that 
pursuant to 10 CFR 140.8, that this exemption is authorized by law and 
is otherwise in the public interest. Therefore, the NRC grants an 
exemption from the requirements from 10 CFR 140.11(a)(4) to the extent 
that primary financial protection in the amount of $100,000,000 shall 
be maintained and that an exemption from participation in the industry 
retrospective rating plan (secondary level financial protection) is 
granted for FSV.
    Pursuant to 10 CFR 51.32, the NRC has determined that the granting 
of this exemption will not have a significant effect on the quality of 
the human environment (59 FR 6311, dated February 10, 1994).
    A copy of the licensee's request for the exemption and supporting 
documentation dated February 25, 1993, and the NRC staff's Safety 
Evaluation, included in the exemption, are available for public 
inspection at the NRC's Public Document Room, 2120 L Street, NW., 
Washington, DC 20037, and at the Weld Library District--Downtown 
Branch, 919 7th Street, Greeley, CO 80631.
    This exemption is effective upon issuance.

    Dated at Rockville, Maryland, this 17th day of February, 1994.

    For the Nuclear Regulatory Commission.
John T. Greeves,
Director, Division of Low-Level Waste Management and Decommissioning, 
Office of Nuclear Material Safety and Safeguards.
[FR Doc. 94-4455 Filed 2-25-94; 8:45 am]
BILLING CODE 7590-01-M