[Federal Register Volume 81, Number 62 (Thursday, March 31, 2016)]
[Notices]
[Pages 18652-18656]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-07305]


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NUCLEAR REGULATORY COMMISSION

[Docket No. 50-302; NRC-2016-0048]


Duke Energy Florida, Inc. Crystal River, Unit 3

AGENCY: Nuclear Regulatory Commission.

ACTION: Exemption; issuance.

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SUMMARY: The U.S. Nuclear Regulatory Commission (NRC) is issuing an 
exemption from the requirement to maintain a specified level of onsite 
property damage insurance in response to a request from Duke Energy 
Florida, Inc. (DEF or the licensee) dated December 17, 2015. This 
exemption would permit the licensee to reduce its onsite property 
damage insurance from $1.06 billion to $50 million at the Crystal River 
Unit 3 Nuclear Generating Station (CR-3) based on the reduced risks and 
consequences of a nuclear incident at a decommissioning nuclear power 
reactor.

DATES: March 31, 2016.

ADDRESSES: Please refer to Docket ID NRC-2016-0048 when contacting the 
NRC about the availability of information regarding this document. You 
may obtain publicly-available information related to this document 
using any of the following methods:
     Federal Rulemaking Web site: Go to http://www.regulations.gov and search for Docket ID NRC-2016-0048. Address 
questions about NRC dockets to Carol Gallagher; telephone: 301-415-
3463; email: [email protected]. For technical questions, contact 
the individual listed in the FOR FURTHER INFORMATION CONTACT section of 
this document.
     NRC's Agencywide Documents Access and Management System 
(ADAMS): You may obtain publicly-available documents on-line in the 
ADAMS Public Documents collection at http://www.nrc.gov/reading-rm/adams.html. To begin the search, select ``ADAMS Public Documents'' and 
then select ``Begin Web-based ADAMS Search.'' For problems with ADAMS, 
please contact the NRC's Public Document Room (PDR) reference staff at 
1-800-397-4209, 301-415-4737, or by

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email to [email protected]. The ADAMS accession number for each 
document referenced in this document (if that document is available in 
ADAMS) is provided the first time that a document is referenced.
     NRC's PDR: You may examine and purchase copies of public 
documents at the NRC's PDR, Room O1-F21, One White Flint North, 11555 
Rockville Pike, Rockville, Maryland 20852.

FOR FURTHER INFORMATION CONTACT: John B. Hickman, Office of Nuclear 
Material Safety and Safeguards, U.S. Nuclear Regulatory Commission, 
Washington, DC 20555-0001; telephone: 301-415-3017; email: 
[email protected].

SUPPLEMENTARY INFORMATION:

I. Background

    The CR-3 facility is a decommissioning power reactor located in 
Citrus County, Florida. The licensee, DEF, is the holder of CR-3 
Facility Operating License No. DPR-72. The license provides, among 
other things, that the facility is subject to all rules, regulations, 
and orders of the NRC now or hereafter in effect.
    By letter dated February 20, 2013 (ADAMS Accession No. 
ML13056A005), DEF submitted to the NRC a certification in accordance 
with section 50.82(a)(1)(i) of title 10 of the Code of Federal 
Regulations (10 CFR) indicating it would permanently cease power 
operations, and with 10 CFR 50.82(a)(1)(ii) that it had permanently 
defueled the reactor vessel at CR-3. On May 28, 2011, DEF completed the 
final removal of fuel from the reactor vessel at CR-3. Because CR-3 is 
a permanently shutdown and defueled facility, and in accordance with 
section 50.82(a)(2), DEF is no longer authorized to operate the reactor 
or emplace nuclear fuel into the reactor vessel. The licensee is still 
authorized to possess and store irradiated (i.e., spent) nuclear fuel. 
The spent fuel is currently being stored onsite in a spent fuel pool 
(SFP).

II. Request/Action

    Under 10 CFR 50.12, ``Specific exemptions,'' DEF requested an 
exemption from 10 CFR 50.54(w)(1) by a letter dated December 17, 2015 
(ADAMS Accession No. ML15351A490). The exemption from the requirements 
of 10 CFR 50.54(w)(1) would permit DEF to reduce the amount of its 
onsite property damage insurance from $1.06 billion to $50 million.
    The regulation in 10 CFR 50.54(w)(1) requires each licensee to have 
and maintain onsite property damage insurance to stabilize and 
decontaminate the reactor and reactor site in the event of an accident. 
The onsite insurance coverage must be either $1.06 billion or whatever 
amount of insurance is generally available from private sources 
(whichever is less).
    The licensee states that the risk and consequences of an accident 
at a permanently shutdown and defueled reactor are much less than the 
risk and consequences from an accident at an operating power reactor. 
In addition, since reactor operation is no longer authorized at CR-3, 
no events could occur that would require the stabilization of reactor 
conditions after an accident. Similarly, the risk of an accident that 
would result in significant onsite contamination at CR-3 is also much 
lower than the risk of such an event at operating reactors. Therefore, 
DEF is requesting an exemption from 10 CFR 50.54(w)(1) to reduce its 
onsite property damage insurance from $1.06 billion to $50 million, 
commensurate with the reduced risk of an accident at the permanently 
shutdown and defueled CR-3 site.

III. Discussion

    Under 10 CFR 50.12, the Commission may, upon application by any 
interested person or upon its own initiative, grant exemptions from the 
requirements of 10 CFR part 50 when: (1) The exemptions are authorized 
by law, will not present an undue risk to public health or safety, and 
are consistent with the common defense and security; and (2) any of the 
special circumstances listed in 10 CFR 50.12(a)(2) are present.
    The financial protection limits of 10 CFR 50.54(w)(1) were 
established after the Three Mile Island accident in 1979 out of concern 
that licensees may be unable to financially cover onsite cleanup costs 
in the event of a major nuclear accident. The NRC based the $1.06 
billion coverage amount requirement on an analysis of an accident at a 
nuclear reactor operating at power that results in a large fission 
product release and requires significant resource expenditures to 
stabilize the reactor conditions and ultimately decontaminate and 
remediate the site. These activities would be similar to the 
stabilization and cleanup activities at the Fukushima Daiichi nuclear 
power facility following the damage from a severe earthquake and 
tsunami.
    The NRC developed these cost estimates based on the spectrum of 
postulated accidents for an operating nuclear reactor and 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 (RCS), as well 
as the inventory of relatively short-lived radionuclides, contribute to 
both the risk and consequences of an accident. With the permanent 
cessation of reactor operations at CR-3 (i.e., the reactor, RCS, and 
supporting systems no longer operate) and the permanent removal of the 
fuel from the reactor core, postulated accidents involving failure or 
malfunction of the reactor, RCS, or supporting systems are no longer 
possible. Additionally, these systems and components cannot support the 
storage of the irradiated fuel.
    During reactor decommissioning, the principal radiological risks 
are associated with the storage of spent fuel onsite. In its December 
17, 2015, exemption request, DEF discusses both design-basis and 
beyond-design-basis events involving irradiated fuel stored in the SFP. 
The licensee states that there are no possible design-basis events at 
CR-3 that could result in a radiological release exceeding the limits 
established by the U.S. Environmental Protection Agency's (EPA) early-
phase Protective Action Guidelines (PAG) of 1 Roentgen Equivalent Man 
(REM) at the exclusion area boundary. The only accident that might lead 
to a significant radiological release at the decommissioning reactor is 
a zirconium fire. The zirconium fire scenario is a postulated, but 
highly unlikely, beyond-design-basis accident scenario that involves 
loss of all water inventory from the SFP, resulting in a significant 
heat-up of the spent fuel, and culminating in substantial zirconium 
cladding oxidation and fuel damage. The probability of a zirconium fire 
scenario is related to the decay heat of the irradiated fuel stored in 
the SFP. Therefore, the risks from a zirconium fire scenario continue 
to decrease as a function of the time that CR-3 has been permanently 
shut down.
    The licensee provided a detailed analysis of hypothetical beyond-
design-basis accidents that could result in a radiological release at 
CR-3 in its September 6, 2013, emergency planning-related license 
amendment and exemption requests (ADAMS Accession No. ML13274A584). One 
of these beyond-design-basis accidents involves a complete loss of SFP 
water inventory, where cooling of the spent fuel would be primarily 
accomplished by natural circulation of air through the uncovered spent 
fuel assemblies. The licensee's analysis of this accident shows that as 
of September 26, 2013, air-cooling of the spent fuel assemblies will be 
sufficient to keep the fuel within a safe temperature range 
indefinitely without fuel damage or radiological

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release. This is important because the NRC staff has previously 
authorized a lesser amount of onsite property damage insurance coverage 
based on analysis of the zirconium fire risk. In SECY-96-256, ``Changes 
to Financial Protection Requirements for Permanently Shutdown Nuclear 
Power Reactors, 10 CFR 50.54(w)(1) and 10 CFR 140.11,'' dated December 
17, 1996 (ADAMS Accession No. ML15062A483), the staff recommended 
changes to the power reactor insurance regulations that would allow 
licensees to lower onsite insurance levels to $50 million upon 
demonstration that the fuel stored in the SFP can be air-cooled. In its 
Staff Requirements Memorandum to SECY-96-256, dated January 28, 1997 
(ADAMS Accession No. ML15062A454), the Commission supported the staff's 
recommendation that, among other things, would allow permanently 
shutdown power reactor licensees to reduce commercial onsite property 
damage insurance coverage to $50 million when the licensee was able to 
demonstrate the technical criterion that the spent fuel could be air-
cooled if the SFP was drained of water. The staff has used this 
technical criterion to grant similar exemptions to other 
decommissioning reactor licensees (e.g., Maine Yankee Atomic Power 
Station, published in the Federal Register on January 19, 1999 (64 FR 
2920); Zion Nuclear Power Station, published in the Federal Register on 
December 28, 1999 (64 FR 72700); and Kewaunee Nuclear Power Plant, 
published in the Federal Register on April 13, 2015 (80 FR 19697)). The 
NRC based these prior exemptions on the licensees' demonstrating that 
the SFP could be air-cooled, consistent with the technical criterion 
discussed above.
    In SECY-00-0145, ``Integrated Rulemaking Plan for Nuclear Power 
Plant Decommissioning,'' dated June 28, 2000, and SECY-01-0100, 
``Policy Issues Related to Safeguards, Insurance, and Emergency 
Preparedness Regulations at Decommissioning Nuclear Power Plants 
Storing Fuel in the Spent Fuel Pools,'' dated June 4, 2001 (ADAMS 
Accession Nos. ML003721626 and ML011450420, respectively), the NRC 
staff discussed additional information concerning SFP zirconium fire 
risks at decommissioning reactors and associated implications for 
onsite property damage insurance. As discussed in SECY-00-0145, 
providing an analysis of when the spent fuel stored in the SFP is 
capable of air-cooling is one measure that a licensee can use to 
demonstrate that the probability of a zirconium fire is exceedingly 
low. More recently, as discussed in SECY-01-0100, the staff has used an 
additional analysis that bounds an incomplete drain down of the SFP 
water or some other catastrophic event (such as a complete drainage of 
the SFP with rearrangement of spent fuel rack geometry and/or the 
addition of rubble to the SFP). The analysis postulates that decay heat 
transfer from the spent fuel via conduction, convection, or radiation 
would be impeded. This analysis is often referred to as an adiabatic 
heatup analysis.
    The DEF analyses, as referenced in DEF's December 15, 2015, 
exemption request, demonstrate that under conditions where the SFP 
water inventory has drained and only air-cooling of the stored 
irradiated fuel is available, there is reasonable assurance that as of 
September 26, 2013, the CR-3 spent fuel will remain at temperatures far 
below those associated with a significant radiological release. In 
addition, the licensee has also provided an adiabatic heatup analysis, 
demonstrating that as of September 26, 2013, there will be at least 
19.7 hours after the loss of all means of cooling (both air and/or 
water) before the spent fuel cladding would reach a temperature where 
the potential for a significant offsite radiological release could 
occur. The licensee states that should all means to cool the spent fuel 
be lost, 19.7 hours is sufficient time for personnel to respond with 
additional resources, equipment, and capability to restore cooling to 
the SFP, even after a non-credible, catastrophic event.
    In the NRC's March 30, 2015, safety evaluation (ADAMS Accession No. 
ML15058A906) of the licensee's request for exemptions from certain 
emergency planning requirements, the NRC staff assessed the DEF 
accident analyses associated with the radiological risks from a 
zirconium fire at the permanently shutdown and defueled CR-3 site. The 
staff has confirmed that under conditions where cooling airflow can 
develop, suitably conservative calculations indicate that as of 
September 26, 2013, the fuel will remain at temperatures where the 
cladding will be undamaged for an unlimited period. For the very 
unlikely beyond-design-basis accident scenario, where the SFP coolant 
inventory is lost in such a manner that all methods of heat removal 
from the spent fuel are no longer available, there will be a minimum of 
19.7 hours from the initiation of the accident until the cladding 
reaches a temperature where offsite radiological release might occur. 
The staff found that 19.7 hours was sufficient time to support 
deployment of mitigation equipment to prevent the zirconium cladding 
from reaching a point of rapid oxidation. Even more time would be 
available now, given that more than two years have passed since the 
analysis was performed and the risks from a zirconium fire scenario 
continue to decrease as a function of the time that the fuel has cooled 
since CR-3 permanently shut down.
    In response to a request for additional information related to the 
licensee's request for exemptions from certain emergency planning 
requirements, the licensee also provided an analysis of a postulated 
airborne dispersal of radioactive waste resin upon dropping a High 
Integrity Container (HIC) outside the power block. Although an airborne 
release is not expected to occur with a drop, or while in storage 
awaiting shipment, due to the low flammability and reactivity of the 
spent resin, a release is nevertheless postulated. The event is based 
on a release of radioactive material with activity and isotopic mix 
taken from the resin shipments that occurred during a recent 5\1/2\ 
year period. The licensee reviewed resin shipments made from 2008 
through June 2013 and obtained the isotopic distribution (except for 
Cobalt-60) from the shipment with the highest overall activity. Cobalt-
60 activity was taken from a different shipment to assure that the 
highest activity was used and the dose was maximized. This created a 
composite maximum shipment having a total activity of approximately 116 
curies, which is approximately twice the activity of the average 
shipment made during this period. The analysis assumed a release of 10 
percent of the total radioactive material inventory and that the 
release would occur outside of the CR-3 site's Auxiliary Building on 
the south berm. The analysis of the dropped spent resin HIC 
consequences indicates that the dose would be 40 mrem total effective 
dose equivalent at the site boundary over a 2-hour period, which is 
well below the PAG limit of 1 rem.
    In SECY-96-256, the NRC staff provided its basis as to why it 
considers $50 million to be an adequate level of onsite property damage 
insurance for a decommissioning reactor, once the spent fuel in the SFP 
is no longer susceptible to a zirconium fire. The staff has postulated 
that there is still a potential for other radiological incidents at a 
decommissioning reactor that could result in significant onsite 
contamination besides a zirconium fire. In SECY-96-256, the NRC staff 
cited the rupture of a large contaminated liquid storage tank, causing 
soil contamination

[[Page 18655]]

and potential groundwater contamination, as the most costly postulated 
event to decontaminate and remediate (other than a SFP zirconium fire). 
The NRC determined that the postulated large liquid radiological waste 
storage tank rupture event would have a bounding onsite cleanup cost of 
approximately $50 million.
    The NRC staff has found that DEF's proposed reduction in onsite 
property damage insurance coverage to a level of $50 million is 
consistent with SECY-96-256. In addition, the staff notes that there is 
a precedent of granting a similar exemption to other permanently 
shutdown and defueled power reactor licensees. As previously stated, 
the staff concluded that as of September 26, 2013, sufficient 
irradiated fuel decay time has elapsed at CR-3 to decrease to 
negligible levels the probability of an onsite radiological release 
from a postulated zirconium fire accident. In addition, the licensee's 
proposal to reduce onsite insurance to a level of $50 million is 
consistent with the maximum estimated cleanup costs for the recovery 
from the rupture of a large liquid radiological waste storage tank.

IV. Regulatory Requirements

A. Authorized by Law

    Under 10 CFR 50.12, the Commission may grant exemptions from the 
regulations in 10 CFR part 50 that the Commission determines are 
authorized by law. The NRC staff has determined that granting of the 
licensee's proposed exemption will not result in a violation of the 
Atomic Energy Act of 1954, as amended, or other laws. Therefore, the 
exemption is authorized by law.

B. No Undue Risk to Public Health and Safety

    The NRC established the onsite property damage insurance 
requirements of 10 CFR 50.54(w)(1) to provide financial assurance that 
following a significant nuclear incident, onsite conditions could be 
stabilized and the site decontaminated. The requirements of 10 CFR 
50.54(w)(1) and the existing level of onsite insurance coverage for CR-
3 are predicated on the assumption that the reactor is operating. 
However, CR-3 is a permanently shutdown and defueled facility. As 
explained in section III of this document, the permanently defueled 
status of the facility has resulted in a significant reduction in the 
number and severity of potential accidents, and correspondingly, a 
significant reduction in the potential for and severity of onsite 
property damage. The proposed reduction in the amount of onsite 
insurance coverage does not impact the probability or consequences of 
potential accidents. The proposed level of insurance coverage is 
commensurate with the reduced risk and reduced cost consequences of 
potential nuclear accidents at CR-3. Therefore, the NRC staff concludes 
that granting the requested exemption will not present an undue risk to 
the health and safety of the public.

C. Consistent With the Common Defense and Security

    The proposed exemption would not eliminate any requirements 
associated with physical protection of the site and would not adversely 
affect DEF's ability to physically secure the site or protect special 
nuclear material. Physical security measures at CR-3 are not affected 
by the requested exemption. Therefore, the proposed exemption is 
consistent with the common defense and security.

D. Special Circumstances

    Under 10 CFR 50.12(a)(2)(ii), special circumstances are present if 
the 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. The underlying purpose of 
10 CFR 50.54(w)(1) is to provide reasonable assurance that adequate 
funds will be available to stabilize conditions and cover onsite 
cleanup costs associated with site decontamination, following an 
accident that results in the release of a significant amount of 
radiological material. As explained in section III of this document, 
because CR-3 is permanently shut down and defueled, the radiological 
consequences of design-basis accidents or other credible events at CR-3 
cannot possibly exceed the limits of the EPA PAGs at the exclusion area 
boundary. The licensee has performed site-specific analyses of highly 
unlikely, beyond-design-basis zirconium fire accidents involving the 
stored irradiated fuel in the SFP. The analyses show that as of 
September 26, 2013, the probabilities of such an accident are minimal. 
The NRC staff's evaluation of the licensee's analyses confirm this 
conclusion.
    The NRC staff also finds that DEF's proposed $50 million level of 
onsite insurance is consistent with the bounding cleanup and 
decontamination cost, as discussed in SECY-96-256, to account for 
hypothetical rupture of a large liquid radiological waste tank at the 
CR-3 site, should such an event occur. Therefore, the staff concludes 
that the application of the current requirements in 10 CFR 50.54(w)(1) 
to maintain $1.06 billion in onsite insurance coverage is not necessary 
to achieve the underlying purpose of the rule for the permanently 
shutdown and defueled CR-3 reactor.
    Under 10 CFR 50.12(a)(2)(iii), special circumstances are present 
whenever 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. The NRC staff concludes that if the licensee 
were required to continue to maintain an onsite insurance level of 
$1.06 billion, the associated insurance premiums would be in excess of 
those necessary and commensurate with the radiological contamination 
risks posed by the site. In addition, such insurance levels would be 
significantly in excess of other decommissioning reactor facilities 
that have been granted similar exemptions by the NRC.
    The NRC staff finds that DEF's compliance with the existing rule 
would result in an undue hardship or other costs that are significantly 
in excess of those contemplated when the regulation was adopted and are 
significantly in excess of those incurred by others similarly situated.
    Therefore, the special circumstances required by 10 CFR 
50.12(a)(2)(ii) and 10 CFR 50.12(a)(2)(iii) exist.

E. Environmental Considerations

    The NRC approval of the exemption from insurance or indemnity 
requirements belongs to a category of actions that the Commission, by 
rule or regulation, has declared to be a categorical exclusion from 
further environmental analysis, after first finding that the category 
of actions does not individually or cumulatively have a significant 
effect on the human environment. Specifically, the exemption is 
categorically excluded from further analysis under Sec.  51.22(c)(25).
    Under 10 CFR 51.22(c)(25), granting an exemption from the 
requirements of any regulation in Chapter I of 10 CFR is a categorical 
exclusion provided that: (1) There is no significant hazards 
consideration; (2) there is no significant change in the types or 
significant increase in the amounts of any effluents that may be 
released offsite; (3) there is no significant increase in individual or 
cumulative public or occupational radiation exposure; (4) there is no 
significant construction impact; (5) there is no significant increase 
in the potential for or consequences from

[[Page 18656]]

radiological accidents; and (6) the requirements from which an 
exemption is sought involve: Surety, insurance, or indemnity 
requirements.
    Utilizing the standards set forth in 10 CFR 50.92, the NRC has 
determined that approval of the exemption request involves no 
significant hazards consideration because reducing the licensee's 
onsite property damage insurance for CR-3 does not: (1) Involve a 
significant increase in the probability or consequences of an accident 
previously evaluated; or (2) create the possibility of a new or 
different kind of accident from any accident previously evaluated; or 
(3) involve a significant reduction in a margin of safety. The exempted 
financial protection regulation is unrelated to the operation of CR-3. 
Accordingly, there is no significant change in the types or significant 
increase in the amounts of any effluents that may be released offsite; 
and no significant increase in individual or cumulative public or 
occupational radiation exposure. The exempted regulation is not 
associated with construction, so there is no significant construction 
impact. The exempted regulation does not concern the source term (i.e., 
potential amount of radiation in an accident), nor mitigation. 
Therefore, there is no significant increase in the potential for, or 
consequences of, a radiological accident. In addition, there would be 
no significant impacts to biota, water resources, historic properties, 
cultural resources, or socioeconomic conditions in the region. The 
requirement for onsite property damage insurance may be viewed as 
involving surety, insurance, or indemnity matters.
    Therefore, pursuant to 10 CFR 51.22(b) and 51.22(c)(25), no 
environmental impact statement or environmental assessment need be 
prepared in connection with the approval of this exemption request.

V. Conclusions

    Accordingly, the Commission has determined that pursuant to 10 CFR 
50.12(a), the requested 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. Also, special 
circumstances are present. Therefore, the Commission hereby grants DEF 
an exemption from the requirements of 10 CFR 50.54(w)(1), to permit the 
licensee to reduce its onsite property damage insurance to a level of 
$50 million.
    The exemption is effective upon issuance.

    Dated at Rockville, Maryland, this 16th day of March 2016.

    For the Nuclear Regulatory Commission.
John R. Tappert,
Director, Division of Decommissioning, Uranium Recovery, and Waste 
Programs, Office of Nuclear Material Safety and Safeguards.
[FR Doc. 2016-07305 Filed 3-30-16; 8:45 am]
BILLING CODE 7590-01-P