[Federal Register Volume 63, Number 228 (Friday, November 27, 1998)]
[Notices]
[Pages 65616-65617]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-31643]


=======================================================================
-----------------------------------------------------------------------

NUCLEAR REGULATORY COMMISSION

[Docket No. 50-213]


In the Matter of Connecticut Yankee Atomic Power Company (Haddam 
Neck Plant); Exemption

I

    Connecticut Yankee Atomic Power Company is the holder of Facility 
Operating License No. DPR-61, which authorizes the licensee to possess 
the Haddam Neck Plant (HNP). The license states, among other things, 
that the facility is subject to all the rules, regulations, and orders 
of the U.S. Nuclear Regulatory Commission (the Commission or NRC) now 
or hereafter in effect. The facility consists of a pressurized-water 
reactor located at the licensee's site in Middlesex County, 
Connecticut. The facility is permanently shut down and defueled, and 
the licensee is no longer authorized to operate or place fuel in the 
reactor.

II

    Section 50.54(w) of 10 CFR Part 50 requires power reactor licensees 
to maintain onsite property damage insurance coverage in the amount of 
$1.06 billion. Section 140.11(a)(4) of 10 CFR Part 140 requires a 
reactor with a rated capacity of 100,000 electrical kilowatts or more 
to maintain liability insurance of $200 million and to participate in a 
secondary insurance pool.
    NRC may grant exemptions from the requirements of 10 CFR Part 50 of 
the regulations which, pursuant to 10 CFR 50.12(a), (1) are authorized 
by law, will not present an undue risk to public health and safety, and 
are consistent with the common defense and security and (2) present 
special circumstances. Special circumstances exist when 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 Section 50.54(w) is to provide sufficient property damage 
insurance coverage to ensure funding for onsite post-accident recovery 
stabilization and decontamination costs in the unlikely event of an 
accident at a nuclear power plant.
    NRC may grant exemptions from the requirements of 10 CFR Part 140 
of the regulations which, pursuant to 10 CFR 140.8, are authorized by 
law and are otherwise in the public interest. The underlying purpose of 
Section 140.11 is to provide sufficient liability insurance to ensure 
funding for claims resulting from a nuclear incident or precautionary 
evacuation.

III

    On October 7, 1997, the licensee requested exemption from the 
financial protection requirement limits of 10 CFR 50.54(w) and 10 CFR 
140.11. The licensee requested that the amount of insurance coverage it 
must maintain be reduced to $50 million for onsite property damage and 
$100 million for offsite financial protection. The licensee stated that 
special circumstances exist because of the permanently shutdown and 
defueled condition of HNP.
    The financial protection limits of 10 CFR 50.54(w) and 10 CFR 
140.11 were established to require a licensee to maintain sufficient 
insurance to cover the costs of a nuclear accident at an operating 
reactor. Those costs were derived from the consequences of a release of 
radioactive material from the reactor. Although the risk of an accident 
at an operating reactor is very low, the consequences can be large. In 
an operating plant, the high temperature and pressure of the reactor 
coolant system, as well as the inventory of relatively short-lived 
radionuclides, contribute to both the risk and consequences of an 
accident. In a permanently shutdown and defueled reactor facility, the 
reactor coolant system will never be operated and contains no short-
lived radionuclides, which eliminates the possibility of reactor 
accidents. A further reduction in risk occurs because decay heat from 
the spent fuel decreases over time, which reduces the amount of cooling 
required to prevent the spent fuel from heatingup to a temperature that 
could compromise the ability of the fuel cladding to retain fission 
products.
    Along with the reduction in risk, the consequences of a release 
decline after a reactor permanently shuts down and defuels. The short-
lived radionuclides contained in the spent fuel, particularly volatile 
components such as iodine and most of the noble gases, decay away, 
thereby reducing the inventory of radioactive materials that are 
readily dispersible and transportable in air.
    Although the risk and consequences of a radiological release 
decline substantially after a plant permanently defuels its reactor, 
they are not completely eliminated. There are potential onsite and 
offsite radiological consequences that could be associated with the 
onsite storage of the spent fuel in the spent fuel pool (SFP). In 
addition, a site may contain a radioactive inventory of liquid 
radwaste, activated reactor components, and contaminated structural 
materials. For purposes of modifying the amount of insurance coverage 
maintained by a power reactor licensee, the potential consequences, 
despite very low risk, are an appropriate consideration.
    In order to determine the insurance coverage sufficient for a 
permanently defueled facility, the cost of recovery from potential 
accident scenarios must be evaluated. At the HNP, spent fuel is the 
largest source term on the site. The spent fuel is stored in the SFP, 
which uses water to cool the fuel. By letter dated September 26, 1997, 
the licensee

[[Page 65617]]

submitted an analysis of the heatup characteristics of the spent fuel 
in the absence of SFP water inventory. The analysis was based on 
storing the fuel in a configuration consistent with the analysis. By 
letter dated December 18, 1997, the licensee stated that, as of October 
23, 1997, the spent fuel assemblies had been rearranged within the SFP 
to comply with the configuration used for the heat-up analysis. The 
licensee concluded that air cooling of the fuel would be sufficient to 
maintain the integrity of the fuel cladding and that rapid zircaloy 
oxidation is no longer possible. The staff independently evaluated the 
licensee's conclusion and found it acceptable. The staff concluded that 
the cost of recovering from a loss of SFP water would be bounded by 
other accidents that may occur at a permanently defueled site.
    In SECY 96-256, ``Changes to the Financial Protection Requirements 
for Permanently Shutdown Nuclear Power Reactors, 10 CFR 50.54(w) and 10 
CFR 140.11,'' dated December 17, 1996, the staff estimated the onsite 
cleanup costs of accidents considered to be the most costly at a 
permanently defueled site with spent fuel stored in the SFP. The staff 
found that the onsite recovery costs for a fuel handling accident could 
range up to $24 million. The estimated onsite cleanup costs to recover 
from the rupture of a large liquid radwaste storage tank could range up 
to $50 million. The licensee's proposed level of $50 million for onsite 
property insurance is sufficient to cover these estimated cleanup 
costs.
    The offsite cleanup costs of the accident scenarios discussed above 
are estimated to be negligible in SECY 96-256. However, a licensee's 
liability for offsite costs may be significant due to lawsuits alleging 
damages from offsite releases. Experience at Three Mile Island Unit 2 
showed that significant judgments against a licensee can result despite 
negligible dose consequences from an offsite release. An appropriate 
level of financial liability coverage is needed to account for 
potential judgments and settlements and to protect the Federal 
Government from indemnity claims. The licensee's proposed level of $100 
million in primary offsite liability coverage is sufficient for this 
purpose.
    The staff has determined that participation in the secondary 
insurance pool for offsite financial protection is not required for a 
permanently shut down and defueled plant after the time that air 
cooling of the spent fuel is sufficient to maintain the integrity of 
the fuel cladding. As noted above, the staff finds that sufficient time 
has elapsed to ensure the integrity of the HNP spent fuel cladding.

IV

    The NRC staff has completed its review of the licensee's request to 
reduce financial protection limits to $50 million for onsite property 
insurance and $100 million for offsite liability insurance. On the 
basis of its review, the NRC staff finds that the spent fuel stored in 
HNP's SFP is no longer susceptible to rapid Zircaloy oxidation. The 
requested reductions are consistent with SECY-96-256, ``Changes to the 
Financial Protection Requirements for Permanently Shutdown Nuclear 
Power Reactors, 10 CFR 50.54(w) and 10 CFR 140.11,'' dated December 17, 
1996. The Commission informed the staff by a staff requirements memo 
dated January 28, 1997, that it did not object to the insurance 
reductions recommended in SECY 96-256. The licensee's proposed 
financial protection limits will provide sufficient insurance to 
recover from limiting hypothetical events, if they occur. Thus, the 
underlying purposes of the regulations will not be adversely affected 
by the reductions in insurance coverage.
    Accordingly, the Commission has determined that, pursuant to 10 CFR 
50.12(a), an exemption to reduce onsite property insurance to $50 
million 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. Further, special circumstances are present, as set forth in 
10 CFR 50.12(a)(2)(ii). Therefore the Commission hereby grants an 
exemption from the requirement of 10 CFR 50.54(w).
    In addition, the Commission has determined that, pursuant to 10 CFR 
140.8, an exemption to reduce primary offsite liability insurance to 
$100 million, accompanied by withdrawal from the secondary insurance 
pool for offsite liability insurance, is authorized by law and is in 
the public interest. Therefore, the Commission hereby grants an 
exemption from the requirements of 10 CFR 140.11(a)(4).
    Pursuant to 10 CFR 51.32, the Commission has determined that the 
granting of these exemptions will not have a significant effect on the 
quality of the human environment (63 FR 50929).
    These exemptions are effective upon issuance.

    Dated at Rockville, Maryland, this 19th day of November 1998.

    For the Nuclear Regulatory Commission.
Roy P. Zimmerman,
Acting Director, Office of Nuclear Reactor Regulation.
[FR Doc. 98-31643 Filed 11-25-98; 8:45 am]
BILLING CODE 7590-01-P