[Federal Register Volume 66, Number 138 (Wednesday, July 18, 2001)]
[Proposed Rules]
[Pages 37432-37434]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-17951]


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NUCLEAR REGULATORY COMMISSION

10 CFR Part 50

[Docket No. PRM-50-70]


Eric Joseph Epstein; Denial of Petition for Rulemaking

AGENCY: Nuclear Regulatory Commission.

ACTION: Denial of petition for rulemaking.

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SUMMARY: The Nuclear Regulatory Commission (NRC or ``Commission'') is 
denying a petition for rulemaking (PRM-50-70) submitted by Eric Joseph 
Epstein. The petitioner requested that NRC amend its financial 
assurance requirements for decommissioning nuclear power reactors to: 
require uniform reporting and recordkeeping for all ``proportional 
owners'' of nuclear generating stations (defined by the petitioner as 
partial owners of nuclear generating stations who are not licensees), 
modify and strengthen current nuclear decommissioning accounting 
requirements for proportional owners, and order proportional owners to 
conduct prudency reviews to determine a balanced formula for 
decommissioning funding that includes not only ratepayers and taxpayers 
but shareholders and board members of rural electric cooperatives as 
well. The NRC is denying the petition because current regulations 
adequately address the first two requested actions and the NRC does not 
have the legal authority to require the third requested action.

ADDRESSES: Copies of the petition for rulemaking, the public comments 
received, and the NRC's letter of denial to the petitioner are 
available for public inspection or copying in the NRC Public Document 
Room, located at One White Flint North, 11555 Rockville Pike (first 
floor), Rockville, Maryland. These documents are also available at the 
NRC's rulemaking website at http://ruleforum.llnl.gov.

FOR FURTHER INFORMATION CONTACT: Brian J. Richter, Office of Nuclear 
Reactor Regulation, U.S. Nuclear Regulatory Commission, Washington, DC 
20555-0001, telephone (301) 415-1978, e-mail: [email protected].

SUPPLEMENTARY INFORMATION:

The Petition

    On May 12, 2000 (65 FR 30550), the NRC published a notice of 
receipt of a petition for rulemaking (PRM) filed by Eric Joseph 
Epstein. The petitioner requested that the NRC amend its financial 
assurance requirements for decommissioning nuclear power reactors to: 
(1) require uniform reporting and recordkeeping for all ``proportional 
owners'' of nuclear generating stations (defined by the petitioner as 
partial owners of nuclear generating stations who are not licensees); 
(2) modify and strengthen current nuclear decommissioning accounting 
requirements for proportional owners; and (3) order proportional owners 
to conduct prudency reviews to determine a balanced formula for 
decommissioning funding that includes not only ratepayers and taxpayers 
but

[[Page 37433]]

shareholders and/or board members of rural electric cooperatives as 
well. In addition, the petitioner raised several issues that, while 
related to his three general requests for rulemaking, were not 
explicitly part of the petitioner's requested remedies. These issues 
are discussed more fully below.
    The petitioner submitted the petition because he believes the 
funding component for decommissioning provided by proportional owners 
of nuclear generating stations, including rural electric cooperatives 
(RECs), is ``fatally flawed'' and likely to contribute to inadequate 
funding.
    The petitioner stated that proportional owners are not required to 
submit periodic cost projections, conduct site-specific studies, or 
coordinate with the power reactor licensee. Also, the petitioner stated 
that proportional owners are not mandated by the NRC to verify, report, 
or monitor recordkeeping relating to nuclear decommissioning funding 
mechanisms.
    The petitioner believes it is grossly unfair and inequitable to 
require Federal taxpayers and State ratepayers to provide a financial 
safety net for the nuclear investments of proportional owners. The 
petitioner offers the following reasons to support his belief: (1) 
proportional owners, including RECs, aggressively supported 
construction, licensing, and operation of nuclear generating stations; 
(2) minority owners were fully cognizant that no commercial nuclear 
reactor had been decommissioned, and that a solution to nuclear waste 
disposal did not exist; (3) neither the utility industry, proportional 
owners, nor RECs have actively sponsored decommissioning research or 
sought good faith solutions to the permanent storage and isolation of 
low-level and high-level radioactive waste; and (4) proportional owners 
and RECs willfully pursued a financial investment in nuclear energy 
which they knew was fraught with huge uncertainties.

Public Comments on the Petition

    The NRC received nine comments in response to the petition. Eight 
commenters, all of whom were licensees or groups representing 
licensees, addressed the three broad topic areas of the petition. The 
ninth set of comments was received from Thomas LaGuardia of TLG 
Services, Inc., an industry consultant which provides decommissioning 
cost estimates. TLG's comments did not respond to the petition itself, 
but identified 16 statements or groups of statements in the petition 
that questioned the reliability of TLG's estimation methods and 
results. TLG addressed those statements.
    All eight commenters who addressed the specific requests of the 
petition recommended that the NRC deny all parts of the petition. Two 
of the commenters simply endorsed the position of one of the other 
commenters, the Nuclear Energy Institute (NEI). In general, the 
commenters provided similar arguments as to why the petition should be 
denied in its entirety. Further, TLG did not explicitly state that NRC 
should grant or deny the petition. However, given that TLG questioned 
many of the statements made by the petitioner to form his case, it 
appears that TLG finds the petition factually deficient. As described 
below, the NRC staff's evaluation of the petition agreed with the 
comments in most respects.
    First, the petitioner requested the NRC to require uniform 
reporting and recordkeeping for all ``proportional owners'' of nuclear 
generating stations (defined by the petitioner as partial owners of 
nuclear generating stations who are not licensees). Several commenters 
noted that all entities with an ownership interest in a commercial 
nuclear power plant are NRC licensees. These consist of minority 
owners, and non-operating owners, including rural electric 
cooperatives. These owners are required to provide the NRC with 
reasonable decommissioning financial assurance.
    The NRC staff has reached a conclusion similar to the commenters. 
All co-owners are required to be co-licensees, subject to all NRC 
regulations, including those with respect to decommissioning reporting. 
See Public Service Company of Indiana, Inc. (Marble Hill Nuclear 
Generating Station, Units 1 and 2), ALAB-459, 7 NRC 179, 198-201 
(1978). Thus, this issue is moot, because the remedy sought by the 
petitioner is already in place.
    Second, the petitioner requested the NRC to modify and strengthen 
its nuclear decommissioning accounting requirements for proportional 
owners. The commenters noted, as stated above, that proportional owners 
are licensees and, as such, are required to provide assurance to the 
NRC of adequate decommissioning funding. Several commenters noted that 
after receiving the biennial decommissioning funding status reports, 
the NRC staff issued an assessment of the reports (SECY-99-170, July 1, 
1999) which indicated that the licensees were accumulating sufficient 
funds for decommissioning. Further, the commenters noted the 
requirements of Sec. 50.75 and Sec. 50.82 provide that licensees are to 
submit up-to-date assessments of final decommissioning costs at or 
about 5 years prior to the projected end of operations, and a post 
shutdown decommissioning activities report (PSDAR) containing a cost 
estimate for decommissioning within 2 years after permanent cessation 
of operations.
    As indicated in its conclusion on the petitioner's first issue, co-
owners are already providing information on the status of their 
decommissioning funds. Based on the review of these status reports in 
1999, the NRC concludes that the NRC's accounting requirements are 
currently sufficient to provide adequate protection of public health 
and safety.
    Third, the petitioner requested the NRC to require proportional 
owners to conduct a prudency review to determine a balanced formula for 
decommissioning funding that includes not only ratepayers and taxpayers 
but shareholders and board members of rural electric cooperatives as 
well. All the licensees or groups of licensees who commented noted that 
NRC does not have the legal authority to require such action. The 
comments from Allegheny Electric Cooperative and PPL Susquehanna, LLC 
noted that a licencee's decommissioning funding [7590-01-P] prudency is 
under the jurisdiction of a State Public Utility Commission, the 
Federal Energy Regulatory Commission, or ratemaking authority of a 
municipal utility, a Rural Electric Cooperative, and other electric 
utility that establishes its own rates. Also, one commenter stated that 
any attempt by the NRC to impose or enforce these remedies would enmesh 
it in lengthy and substantial legal challenges.
    The NRC concludes that the NRC does not have the authority to 
require co-owners to conduct prudency reviews. This is a rate-making 
issue beyond the NRC's jurisdiction.
    The petitioner also raised other issues that, while not part of the 
three requested remedies, prompted responses by commenters. The first 
is the issue of non-radiological costs, about which the petitioner is 
concerned because NRC does not require licensees to provide estimates 
of such costs. Some commenters stated that the NRC has no authority to 
require licensees to return facilities to a ``greenfield'' condition 
because it is not a matter of radiological public health and safety. 
Thus, the commenters stated that the NRC has no programmatic need to 
obtain such data.
    A second ancillary issue raised by the petitioner was that some 
nuclear power plants may not operate for the full terms of their 
licenses, resulting in premature shutdown of the plants. Some 
commenters stated that no licensee of a prematurely shut-down plant has 
ever

[[Page 37434]]

not been able to pay for its plant's decommissioning. Lastly, in 
response to the petitioner's position that premature shutdowns will 
occur, some commenters pointed out that a number of plants are in the 
process of applying for license renewals.
    Next, the petitioner stated that proportional owners of power 
reactors should ``be required to account for the possibility of 
increased spent fuel storage costs, in the event that a high level 
waste storage facility is unavailable.'' One commenter, NEI, quotes 
from a Department of Energy report that indicates that Yucca Mountain 
remains a viable site for spent fuel storage.\1\
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    \1\ ``Viability Assessment of a Repository at Yucca Mountain,'' 
U.S. Department of Energy (DOE-RW-0508), December 1998, page 36.
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    The petitioner also raised two specific issues relating to 
Allegheny Electric Cooperative and PPL Susquehanna, LLC, namely issues 
relating to low-level waste disposal and the adequacy of Allegheny's 
decommissioning funding. Allegheny and Susquehanna submitted comments 
jointly. With respect to the first issue, they noted that minimum 
funding requirements for low-level waste disposal are addressed in 
``Report on Waste Burial Charges,'' NUREG-1307. With respect to the 
funding adequacy issue, Allegheny submitted its required report in 
March 1999 and in response to a request for clarification, resubmitted 
it in May of that year. After review of the resubmitted report, NRC had 
no follow-up concerns. In addition, Allegheny is a rural electric 
cooperative that sets its own rates. Therefore, Allegheny's current 
funding assurance method meets the NRC's requirements.

Reasons for Denial

    In summary, the NRC is denying the petition for the following 
reasons:
    1. With respect to the petitioner's first request to require 
uniform reporting and recordkeeping for all ``proportional owners'' of 
nuclear generating stations, the NRC finds this issue moot because the 
Commission requires all co-owners to be co-licensees. Therefore, under 
10 CFR Sec. 50.75, the co-owners are already required to comply with 
the reporting and recordkeeping requirements. In addition, as discussed 
below, the NRC has determined that all licensees, including co-owners, 
complied with section 50.75(f)(1) by submitting initial decommissioning 
status reports in March 1999. The NRC staff issued an assessment of the 
reports (SECY-99-170, July 1, 1999) which indicated that `` * * * all 
power reactor licensees appear to be on track to fund decommissioning 
by the time that they permanantly shut down their units.'' As a result, 
the NRC finds no need to act on this portion of the petition and denies 
it.
    2. The petitioner's second request was to have NRC modify and 
strengthen its nuclear decommissioning accounting requirements for 
proportional owners. As stated above, proportional owners are licensees 
and are, therefore, required by 10 CFR 50.75(f) to file a biennial 
decommissioning funding status report. The NRC staff has determined 
that licensees are complying with the reporting and recordkeeping 
requirements. As mentioned, the NRC staff issued a positive assessment 
of the reports (SECY-99-170, July 1, 1999). In addition, the 
requirements of Sec. 50.75 and Sec. 50.82 provide for licensees to 
submit up-to-date assessments of final decommissioning costs at or 
about 5 years prior to the projected end of operations, and a post 
shutdown decommissioning activities report (PSDAR) containing a cost 
estimate for decommissioning within 2 years after permanent cessation 
of operations. These requirements pertain to all licensees, including 
proportional owners. As a result, the NRC finds no need to act on this 
portion of the petition and denies it.
    3. The petitioner's third request was for the NRC to require 
proportional owners to conduct prudency reviews. NRC does not have the 
legal authority to require such action under the Atomic Energy Act of 
1954, as amended, the Energy Reorganization Act of 1974, as amended, or 
any other Federal statute. Therefore, NRC also denies this portion of 
the petition.
    As noted above in the comment section, the petitioner also raised 
several ancillary comments. The first was the issue of non-radiological 
costs. Given the NRC has no regulatory requirement that licensees 
return the facilities to ``greenfield'' condition, the NRC has no 
programmatic need to obtain such data. The petitioner's second 
ancillary item was the premature shutdown of nuclear power plants. NRC 
addressed this concern in earlier rulemaking published on June 19, 
1996. See 61 FR 39278 (promulgating 10 CFR 50.82(c)). This rule 
provides that the NRC would address the status of decommissioning 
funding and schedule for the accumulating of any shortfall of funds for 
plants which did not operate for their full terms on a case-by-case 
basis. The third ancillary comment was to require proportional owners 
to account for increased spent fuel storage costs should a high level 
waste storage facility be unavailable. This issue has been addressed by 
the NRC in 10 CFR 50.54(bb) (originally adopted in the Waste Confidence 
Rulemaking), in which reactor licensees are required to ``submit 
written notification to the Commission for its review and preliminary 
approval of the program by which the licensee intends to manage and 
provide funding for the management of all irradiated fuel at the 
reactor following permanent cessation of operation of the reactor until 
title to the irradiated fuel and possession of the fuel is transferred 
to the Secretary of Energy for its ultimate disposal in a repository.''
    Lastly, the petitioner discussed two issues relating specifically 
to Allegheny Electric Cooperative and PPL Susquehanna, LLC, viz. low-
level waste disposal and the adequacy of Allegheny's decommissioning 
funding. The NRC addressed the minimum funding for waste disposal in 
NUREG-1307, Revision 9, which was just published in September 2000. 
Also, as the NRC has indicated in its review of biennial 
decommissioning funding status reports, `` * * * all power reactor 
licensees appear to be on track to fund decommissioning by the time 
that they permanently shutdown their units.'' Therefore, the NRC has no 
indication that Allegheny's decommissioning funding is inadequate.
    The petitioner has touched on many issues of concern to the public 
as the electric generation industry restructures itself as a result of 
rate deregulation. However, the NRC believes that the petitioner's 
concerns have been addressed in the 1998 decommissioning rulemaking, 
Financial Assurance Requirements for Decommissioning Nuclear Power 
Reactors, completed on September 22, 1998 (63 FR 50465), as well as in 
the NRC's overall regulatory framework. Thus, the petitioner has not 
provided any new significant information that would cause NRC to grant 
any portion of the petition. Also, the petitioner has not raised any 
issues that were not considered in that rulemaking. For the foregoing 
reasons, the NRC concludes that this petition should be denied.
    For reasons cited in this document, the Commission denies the 
petition.

    Dated at Rockville, Maryland, this 13th day of July, 2001.

    For the Nuclear Regulatory Commission.
Annette Vietti-Cook,
Secretary of the Commission.
[FR Doc. 01-17951 Filed 7-17-01; 8:45 am]
BILLING CODE 7590-01-P