[Federal Register Volume 83, Number 207 (Thursday, October 25, 2018)]
[Notices]
[Pages 53914-53917]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-23300]


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NUCLEAR REGULATORY COMMISSION

[Docket No. 50-219; NRC-2018-0175]


Exelon Generation Company, LLC; Oyster Creek Nuclear Generating 
Station

AGENCY: Nuclear Regulatory Commission.

ACTION: Exemption; issuance.

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SUMMARY: The U.S. Nuclear Regulatory Commission (NRC) has issued 
exemptions in response to a March 22, 2018, request from Exelon 
Generation Company, LLC (Exelon, the licensee). One exemption permits 
the use of the Oyster Creek Nuclear Generating Station (Oyster Creek) 
Decommissioning Trust Fund (DTF) for irradiated fuel management and 
site restoration activities based on the Oyster Creek Decommissioning 
Cost Estimate (DCE). The other exemption permits the licensee to make 
withdrawals from the DTF for irradiated fuel management and site 
restoration activities without prior notification of the NRC.

DATES: The exemption was issued on October 19, 2018.

ADDRESSES: Please refer to Docket ID NRC-2018-0175 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 Website: Go to http://www.regulations.gov and search for Docket ID NRC-2018-0175. Address 
questions about Dockets IDs in Regulations.gov to Jennifer Borges; 
telephone: 301-287-9127; 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 online in the 
ADAMS Public Documents collection at http://www.nrc.gov/reading-rm/adams.html. To begin the search, 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 email to [email protected]. The ADAMS accession number for each 
document referenced (if it is available in ADAMS) is provided the first 
time that it is mentioned in this document.
     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 G. Lamb, Office of Nuclear 
Reactor Regulation, U.S. Nuclear Regulatory Commission, Washington, DC 
20555-0001; telephone: 301-415-3100; email: [email protected].

SUPPLEMENTARY INFORMATION: The text of the exemption is attached.

    Dated at Rockville, Maryland, this 22nd day of October 2018.

    For the Nuclear Regulatory Commission.
John G. Lamb,
Senior Project Manager, Special Projects and Process Branch, Division 
of Operating Reactor Licensing,Office of Nuclear Reactor Regulation.

Attachment--Exemption

NUCLEAR REGULATORY COMMISSION

Docket No. 50-219

Exelon Generation Company, LLC

Oyster Creek Nuclear Generating Station

Exemption

I. Background.

    Exelon Generation Company, LLC (Exelon, the licensee) is the 
holder of Renewed Facility Operating License No. DPR-16 for the 
Oyster Creek Nuclear Generating Station (Oyster Creek). The facility 
is located in the town of Forked River, Ocean County, New Jersey.
    By letter dated February 14, 2018 (Agencywide Documents Access 
and Management System (ADAMS) Accession No. ML18045A084), Exelon 
submitted to the U.S. Nuclear Regulatory Commission (NRC) a 
certification in accordance with Section 50.82(a)(1)(i) of Title 10 
of the Code of Federal Regulations (10 CFR), stating its 
determination to permanently cease operations at Oyster Creek no 
later than October 31, 2018. By letter dated September 25, 2018 
(ADAMS Accession No. ML18268A258), Exelon submitted to the NRC a 
certification in accordance with 10 CFR 50.82(a)(1)(ii), stating 
that Oyster Creek permanently ceased power operations on September 
17, 2018, and that, as of September 25, 2018, all fuel had been 
permanently removed from the Oyster Creek reactor vessel. By letter 
dated December 30, 2014 (ADAMS Accession No. ML14365A067), Exelon 
submitted the Oyster Creek Irradiated Fuel Management Plan (IFMP) 
pursuant to 10 CFR 50.54(bb) and Preliminary Decommissioning Cost 
Estimate

[[Page 53915]]

(DCE). The DCE was updated by letter dated March 30, 2016 (ADAMS 
Accession No. ML16090A067). By letter dated May 21, 2018 (ADAMS 
Accession No. ML18141A775), Exelon submitted a Post-Shutdown 
Decommissioning Activities Report (PSDAR) and site-specific DCE for 
Oyster Creek.

II. Request/Action.

    By letter dated March 22, 2018 (ADAMS Accession No. 
ML18081A201), Exelon submitted a request for exemptions from 10 CFR 
50.82(a)(8)(i)(A) and 10 CFR 50.75(h)(1)(iv). The exemption from 10 
CFR 50.82(a)(8)(i)(A) would permit Exelon to make withdrawals from 
the Oyster Creek Decommissioning Trust Fund (DTF) for irradiated 
fuel management and site restoration activities in accordance with 
the Oyster Creek DCE. The exemption from 10 CFR 50.75(h)(1)(iv) 
would also permit Exelon to make these withdrawals without prior 
notification of the NRC, similar to withdrawals for decommissioning 
activities made in accordance with 10 CFR 50.82(a)(8). By separate 
letters dated March 30, 2016, and May 21, 2018, Exelon submitted 
updates to the Oyster Creek DCE.
    As part of its exemption request, Exelon provided Table 2, 
``Annual SAFSTOR Decommissioning Fund Cash Flow for Oyster Creek 
Nuclear Generating Station,'' that shows the annual DTF cash flow 
for Oyster Creek, while in SAFSTOR (deferred dismantling). Table 2 
contains the projected withdrawals from the DTF needed to cover the 
estimated costs of radiological decommissioning, irradiated fuel 
management, and site restoration activities as projected on the day 
of the application. Subsequent to its exemption request, Exelon 
provided the DTF balance and cost estimates for these same 
activities in its letter dated May 21, 2018, for the Oyster Creek 
PSDAR and in Attachment 4 to its March 28, 2018, annual report on 
the status of decommissioning funding for Oyster Creek (ADAMS 
Accession No. ML18087A150). The NRC staff considered each of these 
submittals in its review of the exemption request.
    The requirements of 10 CFR 50.82(a)(8)(i)(A) restrict 
withdrawals from DTFs to expenses for legitimate decommissioning 
activities consistent with the definition of decommission in 10 CFR 
50.2. The definition of ``decommission'' in 10 CFR 50.2 is:
    to remove a facility or site safely from service and reduce 
residual radioactivity to a level that permits--
    (1) Release of the property for unrestricted use and termination 
of the license; or
    (2) Release of the property under restricted conditions and 
termination of the license.
    This definition does not include activities associated with 
irradiated fuel management and site restoration activities. The 
requirements of 10 CFR 50.75(h)(1)(iv) also restrict the use of DTF 
disbursements (other than for ordinary administrative costs and 
other incidental expenses of the fund in connection with the 
operation of the fund) to decommissioning expenses until final 
radiological decommissioning is completed. Therefore, an exemption 
from 10 CFR 50.82(a)(8)(i)(A) is needed to allow Exelon to use funds 
from the Oyster Creek DTF for irradiated fuel management and site 
restoration activities at Oyster Creek. The requirements of 10 CFR 
50.75(h)(1)(iv) further provide that, except for withdrawals being 
made under 10 CFR 50.82(a)(8) or for payments of ordinary 
administrative costs and other incidental expenses of the fund in 
connection with the operation of the fund, no disbursement may be 
made from the DTF without written notice to the NRC at least 30 
working days in advance. Therefore, an exemption from 10 CFR 
50.75(h)(1)(iv) is also needed to allow Exelon to use funds from the 
Oyster Creek DTF for irradiated fuel management and site restoration 
activities at Oyster Creek without prior NRC notification.

III. Discussion

    Pursuant to 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 (1) when the 
exemptions are authorized by law, will not present an undue risk to 
the public health and safety, and are consistent with the common 
defense and security; and (2) when any of the special circumstances 
listed in 10 CFR 50.12(a)(2) are present. These special 
circumstances include, among other things:
    (a) 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; and
    (b) 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.

A. The Exemptions are Authorized by Law

    The requested exemptions from 10 CFR 50.82(a)(8)(i)(A) and 10 
CFR 50.75(h)(1)(iv) would allow Exelon to use a portion of the funds 
from the Oyster Creek DTF for irradiated fuel management and site 
restoration activities at Oyster Creek without prior notice to the 
NRC, in the same manner that withdrawals are made under 10 CFR 
50.82(a)(8) for decommissioning activities. As stated above, 10 CFR 
50.12 allows the NRC to grant exemptions from the requirements of 10 
CFR part 50 when the exemptions are authorized by law. The NRC staff 
has determined, as explained below, that granting the licensee's 
proposed exemptions will not result in a violation of the Atomic 
Energy Act of 1954, as amended, or the Commission's regulations. 
Therefore, the exemptions are authorized by law.

B. The Exemptions Present No Undue Risk to the Public Health and Safety

    The underlying purpose of 10 CFR 50.82(a)(8)(i)(A) and 10 CFR 
50.75(h)(1)(iv) is to provide reasonable assurance that adequate 
funds will be available for the radiological decommissioning of 
power reactors. Based on the site-specific DCE and the cash flow 
analysis, use of a portion of the Oyster Creek DTF for irradiated 
fuel management and site restoration activities at Oyster Creek will 
not adversely impact Exelon's ability to complete radiological 
decommissioning within 60 years and terminate the Oyster Creek 
license. Furthermore, an exemption from 10 CFR 50.75(h)(1)(iv) to 
allow the licensee to make withdrawals from the DTF for irradiated 
fuel management and site restoration activities without prior 
written notification to the NRC will not affect the sufficiency of 
funds in the DTF to accomplish radiological decommissioning because 
such withdrawals are still constrained by the provisions of 10 CFR 
50.82(a)(8)(i)(B)-(C) and are reviewable under the annual reporting 
requirements of 10 CFR 50.82(a)(8)(v)-(vii).
    According to the application dated March 22, 2018, there are no 
new accident precursors created by using the DTF in the proposed 
manner. Thus, the probability of postulated accidents is not 
increased. Also, based on the above, the consequences of postulated 
accidents are not increased. No changes are being made in the types 
or amounts of effluents that may be released offsite. There is no 
significant increase in occupational or public radiation exposure. 
Therefore, the requested exemptions will not present an undue risk 
to the public health and safety.

C. The Exemptions are Consistent with the Common Defense and Security

    The requested exemptions would allow Exelon to use funds from 
the Oyster Creek DTF for irradiated fuel management and site 
restoration activities at Oyster Creek. Irradiated fuel management 
under 10 CFR 50.54(bb) is an integral part of the planned Exelon 
decommissioning and license termination process and will not 
adversely affect Exelon's ability to physically secure the site or 
protect special nuclear material. This change to enable the use of a 
portion of the funds from the DTF for irradiated fuel management and 
site restoration activities has no relation to security issues. 
Therefore, the common defense and security is not impacted by the 
requested exemptions.

D. Special Circumstances

    Special circumstances, in accordance with 10 CFR 
50.12(a)(2)(ii), are present whenever application of the regulation 
in the particular circumstances is not necessary to achieve the 
underlying purpose of the regulation.
    The underlying purpose of 10 CFR 50.82(a)(8)(i)(A) and 10 CFR 
50.75(h)(1)(iv), which restrict withdrawals from DTFs to expenses 
for radiological decommissioning activities, is to provide 
reasonable assurance that adequate funds will be available for 
radiological decommissioning of power reactors and license 
termination. Strict application of these requirements would prohibit 
the withdrawal of funds from the Oyster Creek DTF for activities 
other than radiological decommissioning activities at Oyster Creek, 
such as for irradiated fuel management and site restoration 
activities, until final radiological decommissioning at Oyster Creek 
has been completed.
    The March 28, 2018, annual report on the status of 
decommissioning funding for Oyster Creek, and the May 21, 2018, 
PSDAR both report a DTF balance of $982 million as of December 31, 
2017. The cash flow analysis

[[Page 53916]]

in Table 2 of the March 22, 2018, application is based on a 
beginning DTF balance of $979 million as of December 31, 2017. The 
licensee stated that the beginning DTF balance was adjusted to 
account for decommissioning and irradiated fuel management planning 
costs incurred in 2017 that would be reimbursed if the exemption 
were granted. In its analysis provided in the enclosed Table, ``NRC 
Cash Flow Analysis of Oyster Creek Decommissioning Trust Funds and 
Associated Costs, including Irradiated Fuel Management and Site 
Restoration,'' the NRC staff used the lesser opening DTF balance of 
$979 million as a conservative estimate that reflects less money 
available to cover radiological decommissioning, irradiated fuel 
management, and site restoration costs. The Exelon analysis in the 
May 21, 2018, PSDAR projects the total radiological decommissioning 
cost of Oyster Creek to be approximately $1,109 million in 2017 
dollars, the irradiated fuel management costs to be $290 million in 
2017 dollars, and the site restoration costs to be $60.2 million in 
2017 dollars. The estimated costs in the PSDAR are consistent with 
the estimated costs for site radiological decommissioning ($1,103.7 
million in 2017 dollars), ISFSI radiological decommissioning ($5.8 
million in 2017 dollars), irradiated fuel management ($290 million 
in 2017 dollars), and site restoration ($60.2 million in 2017 
dollars) provided by Exelon in the March 22, 2018, exemption 
request.
    The NRC staff performed an independent cash flow analysis of the 
DTF over the 60 year SAFSTOR period (assuming an annual real rate of 
return of 2 percent, as allowed by 10 CFR 50.75(e)(1)(ii)) and 
determined the projected earnings of the DTF. The results of the 
staff's analysis are presented in the enclosed Table. As shown in 
the enclosed Table, the NRC staff confirmed that the current funds 
in the DTF and projected earnings provide reasonable assurance of 
adequate funding to complete all NRC required radiological 
decommissioning activities, and also to pay for irradiated fuel 
management and site restoration activities. Therefore, the NRC staff 
finds that Exelon has provided reasonable assurance that adequate 
funds will be available for the radiological decommissioning of 
Oyster Creek, even with the disbursement of funds from the DTF for 
irradiated fuel management and site restoration activities. 
Consequently, the NRC staff concludes that application of the 
requirements of 10 CFR 50.82(a)(8)(i)(A) and 10 CFR 50.75(h)(1)(iv) 
that funds from the DTF only be used for radiological 
decommissioning activities and not for irradiated fuel management 
and site restoration activities is not necessary to achieve the 
underlying purpose of the rule; thus, special circumstances are 
present supporting approval of the exemption request.
    In its submittal, Exelon also requested exemption from the 
requirement of 10 CFR 50.75(h)(1)(iv) concerning prior written 
notification to the NRC of withdrawals from the DTF to fund 
activities other than radiological decommissioning. The underlying 
purpose of notifying the NRC prior to withdrawal of funds from the 
DTF is to provide opportunity for NRC intervention, when deemed 
necessary, if the withdrawals are for expenses other than those 
authorized by 10 CFR 50.75(h)(1)(iv) and 10 CFR 50.82(a)(8) that 
could result in there being insufficient funds in the DTF to 
accomplish radiological decommissioning.
    By granting the exemptions to 10 CFR 50.75(h)(1)(iv) and 10 CFR 
50.82(a)(8)(i)(A), the NRC staff considers that withdrawals 
consistent with the licensee's submittal dated March 22, 2018, are 
authorized. As stated previously, the NRC staff has determined that 
there are sufficient funds in the DTF to complete radiological 
decommissioning activities as well as to conduct irradiated fuel 
management and site restoration activities consistent with the 
PSDAR, DCE, IFMP, and the March 22, 2018, exemption request. 
Pursuant to the requirements in 10 CFR 50.82(a)(8)(v) and (vii), 
licensees are required to monitor and annually report to the NRC the 
status of the DTF and the licensee's funding for managing irradiated 
fuel. These reports provide the NRC staff with awareness of, and the 
ability to take action on, any actual or potential funding 
deficiencies. Additionally, 10 CFR 50.82(a)(8)(vi) requires that the 
annual financial assurance status report must include additional 
financial assurance to cover the estimated cost of completion if the 
sum of the balance of any remaining decommissioning funds, plus 
earnings on such funds calculated at not greater than a 
2[dash]percent real rate of return, together with the amount 
provided by other financial assurance methods being relied upon, 
does not cover the estimated cost to complete the decommissioning. 
The requested exemption would not allow the withdrawal of funds from 
the DTF for any other purpose that is not currently authorized in 
the regulations without prior notification to the NRC. Therefore, 
the granting of this exemption to 10 CFR 50.75(h)(1)(iv) to allow 
the licensee to make withdrawals from the DTF to cover authorized 
expenses for irradiated fuel management and site restoration 
activities without prior written notification to the NRC will still 
meet the underlying purpose of the regulation.
    Special circumstances, in accordance with 10 CFR 
50.12(a)(2)(iii), 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 licensee states that the DTF contains funds in excess 
of the estimated costs of radiological decommissioning and that 
these excess funds are needed for irradiated fuel management and 
site restoration activities. The NRC does not preclude the use of 
funds from the decommissioning trust in excess of those needed for 
radiological decommissioning for other purposes, such as irradiated 
fuel management or site restoration.
    The NRC has stated that funding for irradiated fuel management 
and site restoration activities may be commingled in the DTF, 
provided that the licensee is able to identify and account for the 
radiological decommissioning funds separately from the funds set 
aside for irradiated fuel management and site restoration activities 
(see NRC Regulatory Issue Summary 2001-07, Rev. 1, ``10 CFR 50.75 
Reporting and Recordkeeping for Decommissioning Planning,'' dated 
January 8, 2009 (ADAMS Accession No. ML083440158), and Regulatory 
Guide 1.184, Rev. 1, ``Decommissioning of Nuclear Power Reactors,'' 
dated October 2013 (ADAMS Accession No. ML13144A840). To prevent 
access to those excess funds in the DTF because irradiated fuel 
management and site restoration activities are not associated with 
radiological decommissioning would create an unnecessary financial 
burden without any corresponding safety benefit. The adequacy of the 
DTF to cover the cost of activities associated with irradiated fuel 
management and site restoration, in addition to radiological 
decommissioning, is supported by the site-specific decommissioning 
cost analysis. If the licensee cannot use its DTF for irradiated 
fuel management and site restoration activities, it would need to 
obtain additional funding that would not be recoverable from the 
DTF, or the licensee would have to modify its decommissioning 
approach and methods. The NRC staff concludes that either outcome 
would impose an unnecessary and undue burden significantly in excess 
of that contemplated when 10 CFR 50.82(a)(8)(i)(A) and 10 CFR 
50.75(h)(1)(iv) were adopted.
    Since the underlying purposes of 10 CFR 50.82(a)(8)(i)(A) and 10 
CFR 50.75(h)(1)(iv) would be achieved by allowing Exelon to use a 
portion of the Oyster Creek DTF for irradiated fuel management and 
site restoration activities without prior NRC notification, and 
since compliance with the regulations would result in an undue 
hardship or other costs that are significantly in excess of those 
contemplated when the regulations were adopted, the special 
circumstances required by 10 CFR 50.12(a)(2)(ii) and 10 CFR 
50.12(a)(2)(iii) exist and support the approval of the requested 
exemptions.

E. Environmental Considerations

    In accordance with 10 CFR 51.31(a), the Commission has 
determined that the granting of the exemptions will not have a 
significant effect on the quality of the human environment (see 
Environmental Assessment and Finding of No Significant Impact 
published in the Federal Register on September 14, 2018 (83 FR 
46763)).

IV. Conclusions.

    In consideration of the above, the NRC staff finds that the 
proposed exemptions confirm the adequacy of funding in the Oyster 
Creek DTF, considering growth, to complete radiological 
decommissioning of the site and to terminate the license and also to 
cover estimated spent fuel management and site restoration 
activities.
    Accordingly, the Commission has determined that, pursuant to 10 
CFR 50.12(a), the exemptions are authorized by law, will not present 
an undue risk to the public health and safety, and are consistent 
with the common defense and security. Also, special circumstances 
are present. Therefore, the Commission hereby grants Exelon

[[Page 53917]]

exemptions from the requirements of 10 CFR 50.82(a)(8)(i)(A) and 10 
CFR 50.75(h)(1)(iv) to allow use of a portion of the funds from the 
Oyster Creek DTF for spent fuel management and site restoration 
activities in accordance with the Oyster Creek PSDAR and DCE, dated 
May 21, 2018. Additionally, the Commission hereby grants Exelon an 
exemption from the requirement of 10 CFR 50.75(h)(1)(iv) to allow 
such withdrawals without prior NRC notification.
    The exemptions are effective upon issuance.

    Dated at Rockville, Maryland, this 19th day of October 2018.

    For the Nuclear Regulatory Commission.

/RA/

Kathryn M. Brock,

Deputy Director, Division of Operating Reactor Licensing, Office of 
Nuclear Reactor Regulation.

[FR Doc. 2018-23300 Filed 10-24-18; 8:45 am]
 BILLING CODE 7590-01-P