[Federal Register Volume 68, Number 224 (Thursday, November 20, 2003)]
[Rules and Regulations]
[Pages 65386-65389]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-29022]


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NUCLEAR REGULATORY COMMISSION

10 CFR Part 50

RIN 3150-AH32


Minor Changes to Decommissioning Trust Fund Provisions

AGENCY: Nuclear Regulatory Commission.

ACTION: Direct final rule.

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SUMMARY: The Nuclear Regulatory Commission (NRC) is amending its 
regulations related to decommissioning trust fund provisions to correct 
typographical errors and make minor changes to a final rule promulgated 
by the NRC in December of 2002. This action adds clarifying language to 
amendments regarding notification requirements, investment 
prohibitions, and the option for licensees to retain their existing 
license conditions.

EFFECTIVE DATE: The final rule will become effective December 24, 2003, 
unless significant adverse comments on the amendment are received by 
December 22, 2003. If the rule is withdrawn as a result of such 
comments, timely notice of the withdrawal will be published in the 
Federal Register. Comments received after December 22, 2003, will be 
considered if it is practical to do so, but the NRC is able to ensure 
only that comments received on or before this date will be considered.

ADDRESSES: You may submit comments by any one of the following methods. 
Please include the following number (RIN 3150-AH32) in the subject line 
of your comments. Comments on rulemakings submitted in writing or in 
electronic form will be made available to the public in their entirety 
on the NRC rulemaking web site. Personal information will not be 
removed from your comments.
    Mail comments to: Secretary, U.S. Nuclear Regulatory Commission, 
Washington, DC 20555-0001, ATTN: Rulemakings and Adjudications Staff.
    E-mail comments to: [email protected]. If you do not receive a reply e-
mail confirming that we have received your comments, contact us 
directly at (301) 415-1966. You may also submit comments via the NRC's 
rulemaking Web site at http://ruleforum.llnl.gov. Address questions 
about our rulemaking Web site to Carol Gallagher (301) 415-5905; email 
[email protected].
    Hand deliver comments to: 11555 Rockville Pike, Rockville, Maryland 
20852, between 7:30 am and 4:15 pm Federal workdays. (Telephone (301) 
415-1966).
    Fax comments to: Secretary, U.S. Nuclear Regulatory Commission at 
(301) 415-1101.
    Publicly available documents related to this rulemaking may be 
viewed electronically on the public computers located at the NRC's 
Public Document Room (PDR), O1 F21, One White Flint North, 11555 
Rockville Pike, Rockville, Maryland. The PDR reproduction contractor 
will copy documents for a fee. Selected documents, including comments, 
may be viewed and downloaded electronically via the NRC rulemaking Web 
site at http://ruleforum.llnl.gov.
    Publicly available documents created or received at the NRC after 
November 1, 1999, are available electronically at the NRC's Electronic 
Reading Room at http://www.nrc.gov/reading-rm/adams.html. From this 
site, the public can gain entry into the NRC's Agencywide Document 
Access and Management System (ADAMS), which provides text and image 
files of NRC's public documents. If you do not have access to ADAMS or 
if there are problems in accessing the documents located in ADAMS, 
contact the NRC Public Document Room (PDR) Reference staff at 1-800-
397-4209, 301-415-4737 or by email to [email protected].

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: Because NRC considers this action to be 
noncontroversial, the NRC is using the direct final rule process for 
this rule. The amendments in this rule will become effective on 
December 24, 2003. However, if the NRC receives significant adverse 
comments on this direct final rule by December 22, 2003, then the NRC 
will publish a document that withdraws this action and will 
subsequently address the comments received in a final rule as a 
response to the companion proposed rule published elsewhere in this 
Federal Register. Absent significant modifications to the proposed 
revisions requiring republication, the NRC will not initiate a second 
comment period on this action.
    A significant adverse comment is a comment where the commenter 
explains why the rule would be inappropriate, including challenges to 
the rule's underlying premise or approach, or would be ineffective or 
unacceptable without a change. A comment is adverse and significant if:
    (1) The comment opposes the rule and provides a reason sufficient 
to require a substantive response in a notice-and-comment process. For 
example, a substantive response is required when--
    (a) The comment causes the staff to reevaluate (or reconsider) its 
position or conduct additional analysis;
    (b) The comment raises an issue serious enough to warrant a 
substantive response to clarify or complete the record; or
    (c) The comment raises a relevant issue that was not previously 
addressed or considered by the staff.
    (2) The comment proposes a change or an addition to the rule and it 
is apparent that the rule would be ineffective or unacceptable without 
incorporation of the change or addition.
    (3) The comment causes the staff to make a change (other than 
editorial) to the rule.

[[Page 65387]]

Background

    On December 24, 2002, the Nuclear Regulatory Commission (NRC) 
published in the Federal Register (67 FR 78332) a final rule entitled 
``Decommissioning Trust Provisions,'' which amended the NRC's 
regulations relating to decommissioning trust provisions for nuclear 
power plant licensees. The rule required licensees that are no longer 
rate-regulated or who no longer have access to a non-bypassable charge 
for decommissioning to have decommissioning trust agreements in a form 
acceptable to the NRC in order to increase assurance that an adequate 
amount of decommissioning funds will be available for their intended 
purpose. The rule has an effective date of December 24, 2003.
    After publication of the final rule, the Nuclear Energy Institute 
(NEI) suggested that an administrative rulemaking be undertaken to 
correct what it perceived to be administrative errors in the rule. The 
NRC agrees with NEI's requested changes, but because NRC considers this 
action noncontroversial and routine, the NRC is using the direct final 
rule procedure for this rule.

NEI's Proposed Changes

    In a July 1, 2003, letter to the Director of the NRC's Office of 
Nuclear Reactor Regulation (NRR), NEI identified ``four important 
instances'' in which ``administrative errors involving errors or 
omissions in drafting, * * * if uncorrected * * * could affect 
efficient implementation of the new rule.'' The four instances 
identified by NEI were (1) notification requirement for administrative 
expenses, (2) effective date of the new rule, (3) preserving the option 
to retain existing license conditions, and (4) investment prohibition.

Notification Requirement for Administrative Expenses

    NEI stated that NRC failed to exclude ordinary administrative 
expenses from the new rule's requirement that the fund withdrawals 
require prior NRC notification. Further, NEI stated that the NRC did 
not intend, supported by the language in its Statement of 
Considerations, for licensees to notify the NRC when paying ordinary 
trust administrative expenses. NEI asserted that `` * * * [T]he above-
cited provisions of the final rule failed to associate administrative 
expenses with an exclusion from the notice requirement.'' In fact, the 
final rule states in Sec.  50.75(h)(1)(iv) `` * * * Disbursements, or 
payments from the trust, escrow account, Government fund, or other 
account used to segregate and manage the funds, other than for payments 
of ordinary administrative costs (including taxes) and other incidental 
expenses of the fund (including legal, accounting, actuarial, and 
trustee expenses) in connection with the operation of the fund, are 
restricted to decommissioning expenses or transfer to another financial 
assurance method acceptable under paragraph (e) of this section until 
final decommissioning has been completed. * * *'' (emphasis added.)
    In order to eliminate any further confusion regarding the present 
rule language, the NRC is revising the rule language to essentially the 
language NEI proposed. That is, 10 CFR 50.75(h)(1)(iv) will read 
``Except for withdrawals being made under 10 CFR 50.82(a)(8) or for 
payments of ordinary administrative costs (including taxes) and other 
incidental expenses of the fund (including legal, accounting, 
actuarial, and trustee expenses) in connection with the operation of 
the fund, no disbursement or payment may be made from the trust, * * 
*'' (emphasis added.)
    Further, this rulemaking is also revising the first sentence of 10 
CFR 50.75(h)(2) to read ``Licensees that are `electric utilities' under 
Sec.  50.2 that use prepayment or an external sinking fund to provide 
financial assurance, shall include a provision in the terms of the 
trust, escrow account, Government fund, or other account used to 
segregate and manage funds that except for withdrawals being made under 
10 CFR 50.82(a)(8) or for payments of ordinary administrative costs 
(including taxes) and other incidental expenses of the fund (including 
legal, accounting, actuarial, and trustee expenses) in connection with 
the operation of the fund, no disbursement or payment may be made, from 
the trust, * * *.'' (emphasis added.)

Effective Date of the New Rule

    The second point NEI raised related to the effective date of the 
new rule. NEI's position is that certain changes made by the rule, 
other than those changes in 10 CFR 50.75(h)(1)-(3), should be made 
immediately effective, rather than on December 24, 2003, as now called 
for in the rule. The NRC believes that there is no substantive reason 
to change the effective date of the rule because the Commission has 
already determined that the December 24, 2003, effective date is 
appropriate.

Preserving the Option To Retain Existing License Conditions

    NEI's third point related to licensees being able to retain their 
existing license conditions. NEI stated that the rule language does not 
reflect the intent of the Commission that individual licensees should 
have the option of retaining their existing license conditions. The NRC 
agrees with the comment and amends the rule by adding the following as 
a new section, 10 CFR 50.75(h)(5), to become effective on December 24, 
2003:

    The provisions of paragraphs (h)(1) through (h)(3) do not apply 
to any licensee that as of December 24, 2003, was subject to 
existing license conditions relating to the terms and conditions of 
decommissioning trust agreements, so long as the licensee does not 
elect to amend those license conditions. If a licensee with existing 
license conditions relating to decommissioning trust agreements 
elects to amend the conditions, the license amendment shall be in 
accordance with the provisions of paragraph (h) of this section.

Investment Prohibition

    Lastly, NEI discussed investment prohibition requirements of the 
rule. NEI stated that the rule failed ``to include a general 
prohibition against investments in nuclear plant owners, although such 
a prohibition was intended * * *,'' and proposed the following change 
in Sec.  50.75(h)(1)(i)(A) which, as revised, would read: `` * * * is 
prohibited from investing the funds in securities or other obligations 
of the licensee or any other owner or operator of any power reactor * * 
*'' (emphasis added.) The NRC agrees and is making the proposed change 
(with the modification ``any nuclear power reactor'' to be consistent 
with the rest of the rule) through this direct final rule effort.

Miscellaneous NRC Corrections

    The NRC is clarifying the applicability of the de minimis 
limitation contained in the investment prohibition, so that the de 
minimis proviso will now read `` * * * and provided further that no 
more than 10 percent of trust assets may be indirectly invested in 
securities of any entity owning or operating one or more nuclear power 
plants.'' In addition, the NRC is making an editorial change to clarify 
that the securities of operators, as well as owners, of nuclear power 
plants are subject to the investment provisions in their entirety. 
Finally, the NRC is correcting minor typographical errors in paragraphs 
(e)(1)(i) and (e)(1)(ii) so that the term ``permanent termination of 
operations'' is used in full where the term ``permanent termination'' 
now

[[Page 65388]]

appears, and correcting Sec.  50.75(h)(1)(i)(B) to make consistent 
references to ``standard of care'.

Voluntary Consensus Standards

    The National Technology Transfer and Advancement Act of 1995, Pub. 
L. 104-113, requires that Federal agencies use technical standards that 
are developed or adopted by voluntary consensus standards bodies unless 
using such a standard is inconsistent with applicable law or is 
otherwise impractical. In this final rule, the NRC is making clarifying 
changes to the existing rule and modifying the effective date of a part 
of the rule. These actions do not constitute the establishment of a 
standard that contains generally applicable requirements.

Finding of No Significant Environmental Impact: Availability

    The Commission has determined under the National Environmental 
Policy Act of 1969, as amended, and the Commission's regulations in 
Subpart A of 10 CFR part 51 that this rule is not a major Federal 
action significantly affecting the quality of the human environment 
and, therefore, an environmental impact statement is not required. 
These changes would not result in any increased impact on the 
environment from decommissioning activities as analyzed in the Final 
Generic Environmental Impact Statement on Decommissioning of Nuclear 
Facilities (NUREG-0586, August 1988) and Draft Supplement 1 (NUREG-
0586, Draft Supplement 1, October 2001). Therefore, promulgation of 
this rule would not introduce any impacts on the environment not 
previously considered by the NRC.

Paperwork Reduction Act Statement

    This final rule does not contain new or amended information 
collection requirements subject to the Paperwork Reduction Act of 1995 
(44 U.S.C. 3501 et seq.). Existing requirements were approved by the 
Office of Management and Budget (OMB) approval 3150-0011, 10 CFR part 
50.

Public Protection Notification

    The NRC may not conduct or sponsor, and a person is not required to 
respond to, a request for information or an information collection 
requirement unless the requesting document displays a currently valid 
OMB control number.

Regulatory Analysis

    A regulatory analysis has not been prepared for this direct final 
rule because this rule is considered a minor, nonsubstantive amendment; 
it has no economic impact on NRC licensees or the public.

Regulatory Flexibility Certification

    In accordance with the Regulatory Flexibility Act (5 U.S.C. 
605(b)), the Commission certifies that this rule does not have a 
significant economic impact on a substantial number of small entities. 
This final rule affects only the licensing and operation of nuclear 
power plants. The companies that own these plants do not fall within 
the scope of the definition of ``small entities'' set forth in the 
Regulatory Flexibility Act or the size standards established by the NRC 
(10 CFR 2.810).

Backfit Analysis

    The NRC has determined that the backfit rule does not apply to this 
rule, and, therefore, a backfit analysis is not required because these 
amendments do not involve any provisions that would impose backfits as 
defined in 10 CFR chapter I.

Small Business Regulatory Enforcement Fairness Act

    In accordance with the Small Business Regulatory Enforcement 
Fairness Act of 1996, the NRC has determined that this action is not a 
major rule and has verified this determination with the Office of 
Information and Regulatory Affairs of OMB.

List of Subjects in 10 CFR Part 50

    Antitrust, Classified information, Criminal penalties, Fire 
protection, Intergovernmental relations, Nuclear power plants and 
reactors, Radiation protection, Reactor siting criteria, and Reporting 
and recordkeeping requirements.

0
For the reasons set out in the preamble and under the authority of the 
Atomic Energy Act of 1954, as amended; the Energy Reorganization Act of 
1974, as amended; and 5 U.S.C. 552 and 553, the NRC is adopting the 
following amendments to 10 CFR Part 50.

PART 50--DOMESTIC LICENSING OF PRODUCTION AND UTILIZATION 
FACILITIES

0
1. The authority citation for Part 50 continues to read as follows:

    Authority: Secs. 102, 103, 104, 105, 161, 182, 183, 186, 189, 68 
Stat. 936, 937, 938, 948, 953, 954, 955, 956, as amended, sec. 234, 
83 Stat. 444, as amended (42 U.S.C. 2132, 2133, 2134, 2135, 2201, 
2232, 2233, 2236, 2239, 2282); Secs. 201, as amended, 202, 206, 88 
Stat. 1242, as amended, 1244, 1246 (42 U.S.C. 5841, 5842, 5846).
    Section 50.7 also issued under Pub. L. 95-601, sec. 10, 92 Stat. 
2951 (42 U.S.C. 5851). Section 50.10 also issued under Secs. 101, 
185, 68 Stat. 955 as amended (42 U.S.C. 2131, 2235), sec. 102, Pub. 
L. 91-190, 83 Stat. 853 (42 U.S.C. 4332). Sections 50.13, 50.54(dd), 
and 50.103 also issued under sec. 108, 68 Stat. 939, as amended (42 
U.S.C. 2138). Sections 50.23, 50.35, 50.55, and 50.56 also issued 
under sec. 185, 68 Stat. 955 (42 U.S.C. 2235).
    Sections 50.33a, 50.55a and Appendix Q also issued under sec. 
102, Pub. L. 91-190, 83 Stat. 853 (42 U.S.C. 4332). Sections 50.34 
and 50.54 also issued under sec. 204, 88 Stat. 1245 (42 U.S.C. 
5844). Sections 50.58, 50.91, and 50.92 also issued under Pub. L. 
97-415, 96 Stat. 2073 (42 U.S.C. 2239). Section 50.78 also issued 
under sec. 122, 68 Stat. 939 (42 U.S.C. 2152). Sections 50.80-50.81 
also issued under sec. 184, 68 Stat. 954, as amended (42 U.S.C. 
2234). Appendix F also issued under sec. 187, 68 Stat. 955 (42 
U.S.C. 2237).

0
2. In Sec.  50.75, the sixth sentence of paragraphs (e)(1)(i) and the 
sixth sentence of (e)(1)(ii), paragraph (h)(1)(i)(A), the first 
sentences of paragraphs (h)(1)(i)(B), (h)(1)(iv), and (h)(2), are 
revised, and a new paragraph (h)(5) is added to read as follows:


Sec.  50.75  Reporting and recordkeeping for decommissioning planning.

* * * * *
    (e) * * *
    (1) * * *
    (i) * * * A licensee that has prepaid funds based on the formulas 
in Sec.  50.75(c) of this section may take credit for projected 
earnings on the prepaid decommissioning funds using up to a 2 percent 
annual real rate of return up to the time of permanent termination of 
operations.
    (ii) * * * A licensee that has collected funds based on the 
formulas in Sec.  50.75(c) of this section may take credit for 
collected earnings on the decommissioning funds using up to a 2 percent 
annual real rate of return up to the time of permanent termination of 
operations.* * *
* * * * *
    (h) * * *
    (1) * * *
    (i) * * *
    (A) Is prohibited from investing the funds in securities or other 
obligations of the licensee or any other owner or operator of any 
nuclear power reactor or their affiliates, subsidiaries, successors or 
assigns, or in a mutual fund in which at least 50 percent of the fund 
is invested in the securities of a licensee or parent company whose 
subsidiary is an owner or operator of a foreign or domestic nuclear 
power plant. However, the funds may be invested in securities tied to 
market indices or other non-nuclear sector collective, commingled,

[[Page 65389]]

or mutual funds, provided that this subsection shall not operate in 
such a way as to require the sale or transfer either in whole or in 
part, or other disposition of any such prohibited investment that was 
made before the publication date of this rule, and provided further 
that no more than 10 percent of trust assets may be indirectly invested 
in securities of any entity owning or operating one or more nuclear 
power plants.
    (B) Is obligated at all times to adhere to a standard of care set 
forth in the trust, which either shall be the standard of care, whether 
in investing or otherwise, required by State or Federal law or one or 
more State or Federal regulatory agencies with jurisdiction over the 
trust funds, or, in the absence of any such standard of care, whether 
in investing or otherwise, that a prudent investor would use in the 
same circumstances. * * *
* * * * *
    (iv) Except for withdrawals being made under 10 CFR 50.82(a)(8) or 
for payments of ordinary administrative costs (including taxes) and 
other incidental expenses of the fund (including legal, accounting, 
actuarial, and trustee expenses) in connection with the operation of 
the fund, no disbursement or payment may be made from the trust, escrow 
account, Government fund, or other account used to segregate and manage 
the funds until written notice of the intention to make a disbursement 
or payment has been given to the Director, Office of Nuclear Reactor 
Regulation, or the Director, Office of Nuclear Material Safety and 
Safeguards, as applicable, at least 30 working days before the date of 
the intended disbursement or payment. * * *
    (2) Licensees that are ``electric utilities'' under Sec.  50.2 that 
use prepayment or an external sinking fund to provide financial 
assurance shall include a provision in the terms of the trust, escrow 
account, Government fund, or other account used to segregate and manage 
funds that except for withdrawals being made under 10 CFR 50.82(a)(8) 
or for payments of ordinary administrative costs (including taxes) and 
other incidental expenses of the fund (including legal, accounting, 
actuarial, and trustee expenses) in connection with the operation of 
the fund, no disbursement or payment may be made from the trust, escrow 
account, Government fund, or other account used to segregate and manage 
the funds until written notice of the intention to make a disbursement 
or payment has been given the Director, Office of Nuclear Reactor 
Regulation, or the Director, Office of Nuclear Material Safety and 
Safeguards, as applicable at least 30 working days before the date of 
the intended disbursement or payment. * * *
* * * * *
    (5) The provisions of paragraphs (h)(1) through (h)(3) of this 
section do not apply to any licensee that as of December 24, 2003, has 
existing license conditions relating to decommissioning trust 
agreements, so long as the licensee does not elect to amend those 
license conditions. If a licensee with existing license conditions 
relating to decommissioning trust agreements elects to amend those 
conditions, the license amendment shall be in accordance with the 
provisions of paragraph (h) of this section.

    Dated at Rockville, Maryland, this 20th day of October, 2003.

    For the Nuclear Regulatory Commission.
William D. Travers,
Executive Director for Operations.
[FR Doc. 03-29022 Filed 11-19-03; 8:45 am]
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