[Federal Register Volume 84, Number 118 (Wednesday, June 19, 2019)]
[Notices]
[Pages 28595-28600]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-13013]


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NUCLEAR REGULATORY COMMISSION

[Docket No. 50-219; NRC-2018-0288]


Exelon Generation Company, LLC; Oyster Creek Nuclear Generating 
Station

AGENCY: Nuclear Regulatory Commission.

ACTION: Exemption; reissuance.

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SUMMARY: The U.S. Nuclear Regulatory Commission (NRC) is reissuing an 
exemption, originally approved on December 19, 2018, that allowed 
Exelon to reduce the required level of primary off[dash]site liability 
insurance for Oyster Creek Nuclear Generating Station (Oyster Creek) 
from $450 million to $100 million and eliminate the requirement to 
carry secondary financial protection. The December 19, 2018, exemption 
originally had an effective date of 12 months (365 days) from the 
certification of permanent cessation of power operations. The reissued 
exemption has a new effective date of 9.38 months (285 days) after the 
docketing of the certification of permanent cessation of power 
operations at Oyster Creek.

DATES: The exemption was issued on June 12, 2019.

ADDRESSES: Please refer to Docket ID NRC-2018-0288 when contacting the 
NRC about the availability of information regarding this document. You 
may obtain publicly[dash]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-2018-0288. Address 
questions about NRC docket IDs in Regulations.gov to Jennifer Borges; 
telephone: 301-287-9127; email: [email protected]. For technical

[[Page 28596]]

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 e-mail 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: Amy M. Snyder, Office of Nuclear 
Material Safety and Safeguards, U.S. Nuclear Regulatory Commission, 
Washington, DC 20555-0001; telephone: 301-415-6822; e-mail: 
[email protected].

SUPPLEMENTARY INFORMATION: The text of the exemption is attached.

    Dated at Rockville, Maryland, this 14th day of June, 2019.
    For the Nuclear Regulatory Commission.
Bruce A. Watson,
Chief, Reactor Decommissioning Branch, Division of Decommissioning, 
Uranium Recovery and Waste Programs, Office of Nuclear Material Safety 
and Safeguards.

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 Oyster 
Creek Nuclear Generating Station (Oyster Creek). 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 
Sections 50.82(a)(1)(i) of Title 10 of the Code of Federal Regulations 
(10 CFR), indicating that it plans to cease permanent operation 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. The facility consists of a permanently 
shutdown and defueled boiling-water reactor located in the town of 
Forked River, Ocean County, New Jersey.

II. Request/Action.

    On December 19, 2018, the NRC exempted Exelon from 10 CFR 
140.11(a)(4) to allow Exelon to reduce the required level of primary 
off[dash]site liability insurance for Oyster Creek from $450,000,000 to 
$100,000,000, and eliminate the requirement for Oyster Creek to carry 
secondary financial protection (ADAMS Accession Nos. ML18229A005 [Cover 
Letter] and ML18229A006 [Exemption]). The December 19, 2018, exemption 
originally had an effective date of 12 months (365 days) from the 
certification of permanent cessation of power operations under 10 CFR 
50.82(a)(1).
    By letter dated April 4, 2019 (ADAMS Accession No. ML19094B776), 
Exelon requested to change the effective date of the December 19, 2018, 
exemption from 12 months (365 days) to 9.38 months (285 days) from the 
certification of permanent cessation of power operations under 10 CFR 
50.82(a)(1). Exelon certified that Oyster Creek permanently ceased 
power operations on September 17, 2018. Therefore, the revised 
effective date of the exemption would be June 29, 2019.
    To provide a complete record of the NRC staff's review, the NRC is 
reissuing the December 19, 2018, exemption from 10 CFR 140.11(a)(4) 
with a revised effective date of 9.38 months (285 days) from the 
certification of permanent cessation of power operations under 10 CFR 
50.82(a)(1). This reissued exemption supersedes the exemption issued on 
December 19, 2018.
    The regulation at 10 CFR 140.11(a)(4) requires each licensee to 
have and maintain primary financial protection in an amount of $450 
million. In addition, the licensee is required to participate in an 
industry retrospective rating plan (secondary financial protection) 
that commits each licensee to pay into an insurance pool to be used for 
damages that may exceed primary insurance coverage. Participation in 
the industry retrospective rating plan will subject Exelon to deferred 
premium charges up to a maximum total deferred premium of $131,056,000 
with respect to any nuclear incident at any operating nuclear power 
plant, and up to a maximum annual deferred premium of $20,496,000 per 
incident.
    The licensee states that the risk of an offsite radiological 
release is significantly lower at a nuclear power reactor that has 
permanently shut down and defueled, when compared to an operating power 
reactor. Similarly, the associated risk of offsite liability damages 
that would require insurance or indemnification is commensurately lower 
for permanently shut down and defueled plants. Therefore, Exelon 
requested an exemption from 10 CFR 140.11(a)(4), to permit a reduction 
in primary offsite liability insurance and to withdraw from 
participation in the industry retrospective rating plan.

III. Discussion.

    Pursuant to 10 CFR 140.8, ``Specific exemptions,'' the Commission 
may, upon application of any interested person or upon its own 
initiative, grant such exemptions from the requirements of the 
regulations in 10 CFR part 140, when the exemptions are authorized by 
law and are otherwise in the public interest. The NRC staff has 
reviewed Exelon's request for an exemption from 10 CFR 140.11(a)(4) and 
has concluded that the requested exemption is authorized by law and is 
otherwise in the public interest.
    The Price Anderson Act of 1957 (PAA) requires that nuclear power 
reactor licensees have insurance to compensate the public for damages 
arising from a nuclear incident. Specifically, the PAA requires 
licensees of facilities with a ``rated capacity of 100,000 electrical 
kilowatts or more'' to maintain the maximum amount of primary offsite 
liability insurance commercially available (currently $450 million) and 
a specified amount of secondary insurance coverage (currently up to 
$131,056,000 per reactor). In the event of an accident causing offsite 
damages in excess of $450 million, each licensee would be assessed a 
prorated share of the excess damages, up to $131,056,000 per reactor, 
for a total of approximately $13 billion per nuclear incident. The 
NRC's regulations at 10 CFR 140.11(a)(4) implement these PAA insurance 
requirements and set forth the amount of primary and secondary 
insurance each power reactor licensee must have.
    As noted above, the PAA requirements with respect to primary and 
secondary insurance, and the implementing regulations at 10 CFR

[[Page 28597]]

140.11(a)(4), apply to licensees of facilities with a ``rated capacity 
of 100,000 electrical kilowatts or more.'' When the NRC issues a 
license amendment to a decommissioning licensee to reflect the defueled 
status of the facility, the license amendment includes removal of the 
rated capacity of the reactor from the license.
    Accordingly, a reactor that is undergoing decommissioning has no 
``rated capacity.'' Removal of the rated capacity from the facility of 
a decommissioning licensee, thus, allows the NRC to take the reactor 
licensee out of the category of reactor licensees that are required to 
maintain the maximum available insurance and to participate in the 
secondary retrospective insurance pool under the PAA, subject to a 
technical finding that lesser potential hazards exist at the facility 
after termination of operations.
    The financial protection limits of 10 CFR 140.11(a)(4) were 
established to require a licensee to maintain sufficient insurance, as 
specified under the PAA, to satisfy liability claims by members of the 
public for personal injury, property damage, and the legal cost 
associated with lawsuits, as the result of a nuclear accident at an 
operating reactor with a rated capacity of 100,000 kilowatts electric 
(or greater). Thus, the insurance levels established by this 
regulation, as required by the PAA, were associated with the risks and 
potential consequences of an accident at an operating reactor with a 
rated capacity of 100,000 kilowatts electric (or greater).
    The legal and associated technical basis for granting exemptions 
from 10 CFR part 140 is set forth in SECY-93-127, ``Financial 
Protection Required of Licensees of Large Nuclear Power Plants During 
Decommissioning,'' dated May 10, 1993 (ADAMS Accession No. 
ML12257A628). The legal analysis underlying SECY-93-127 concluded that, 
upon a technical finding that lesser potential hazards exist after 
termination of operations (and removal of the rated capacity), the 
Commission has the discretion under the PAA to reduce the amount of 
insurance required of a licensee undergoing decommissioning.
    As a technical matter, the fact that a reactor has permanently 
ceased operations is not itself determinative as to whether a licensee 
may cease providing the offsite liability coverage required by the PAA 
and 10 CFR 140.11(a)(4). In light of the presence of freshly discharged 
irradiated fuel in the spent fuel pool (SFP) at a recently shutdown 
reactor, the primary consideration is the risk of offsite radiological 
release from a zirconium fire. That risk generally remains for about 
10-16 months of decay time for the fuel used in the last cycle of power 
operation. After that time, the offsite consequences of an offsite 
radiological release from a zirconium fire are negligible for shutdown 
reactors, but the SFP is still operational and an inventory of 
radioactive materials still exists onsite. Therefore, an evaluation of 
the potential for offsite damage is necessary to determine the 
appropriate level of offsite insurance post shutdown, in accordance 
with the Commission's discretionary authority under the PAA to 
establish an appropriate level of required financial protection for 
such shutdown facilities.
    The NRC staff has conducted an evaluation and concluded that, aside 
from the handling, storage, and transportation of spent fuel and 
radioactive materials for a permanently shut down and defueled reactor, 
no reasonably conceivable potential accident exists that could cause 
significant offsite damage. During normal power reactor operations, the 
forced flow of water through the reactor coolant system removes heat 
generated by the reactor. The reactor coolant system transfers this 
heat away from the reactor core by converting reactor feedwater to 
steam, which then flows to the main turbine generator to produce 
electricity. Most of the accident scenarios postulated for operating 
power reactors involve failures or malfunctions of systems that could 
affect the fuel in the reactor core, which in the most severe 
postulated accidents, would involve the release of large quantities of 
fission products. With the permanent cessation of reactor operations at 
Oyster Creek and the permanent removal of the fuel from the reactor 
core, such accidents are no longer possible. The reactor, reactor 
coolant system, and supporting systems no longer operate and have no 
function related to the storage of the irradiated fuel. Therefore, 
postulated accidents involving failure or malfunction of the reactor, 
reactor coolant system, or supporting systems are no longer applicable.
    During reactor decommissioning, the principal radiological risks 
are associated with the storage of spent fuel onsite. On a case-by-case 
basis, licensees undergoing decommissioning have been granted 
permission to reduce the required amount of primary offsite liability 
insurance coverage from $450 million to $100 million and to withdraw 
from the secondary insurance pool. One of the technical criteria for 
granting the exemption is that the possibility of a design-basis event 
that could cause significant offsite damage has been eliminated.
    The NRC staff performed an evaluation of the design-basis accidents 
for Oyster Creek being permanently defueled as part of SECY-18-0062, 
``Request by the Exelon Generation Company, LLC for Exemptions from 
Certain Emergency Planning Requirements for the Oyster Creek Nuclear 
Generating Station,'' dated May 31, 2018 (ADAMS Accession No. 
ML18030B340).
    The licensee has stated, and the NRC staff agrees, that while spent 
fuel remains in the SFP, the only postulated design-basis accident that 
would remain applicable to Oyster Creek in the permanently defueled 
condition that could contribute a significant dose will be a fuel 
handling accident (FHA) in the Reactor Building, where the SFP is 
located. For completeness, the NRC staff also evaluated the 
applicability of other design-basis accidents documented in the Oyster 
Creek Updated Final Safety Analysis Report (UFSAR) (ADAMS Accession No. 
ML15307A558), to ensure that these accidents would not have 
consequences that could potentially exceed the 10 CFR 50.67 dose limits 
and Regulatory Guide 1.183, ``Alternative Radiological Source Terms for 
Evaluating Design Basis Accidents at Nuclear Power Reactors,'' dose 
acceptance criteria or approach the U.S. Environmental Protection 
Agency (EPA) early phase protective action guides (PAGs).
    In the Oyster Creek UFSAR, the licensee has determined that within 
33 days after shutdown, the FHA doses would decrease to a level that 
would not warrant protective actions under the EPA early phase PAG 
framework, notwithstanding meeting the dose limit requirements under 10 
CFR 50.67 and dose acceptance criteria under Regulatory Guide 1.183.
    The NRC staff notes that the doses from an FHA are dominated by the 
isotope Iodine-131. The date of cessation of power operations of Oyster 
Creek occurred on September 17, 2018. With 9.38 months of decay, the 
thyroid dose from an FHA would be negligible. After 9.38 months of 
decay, the only isotope remaining in significant amounts, among those 
postulated to be released in a design-basis accident FHA, would be 
Krypton-85. Since Krypton-85 primarily decays by beta emission, the 
calculated skin dose from an FHA analysis would make an insignificant 
contribution to the total effective dose equivalent (TEDE), which is 
the parameter of interest in the determination of the EPA early phase 
PAGs for sheltering or evacuation. The

[[Page 28598]]

NRC staff concludes that the dose consequence from an FHA for the 
permanently defueled Oyster Creek would not approach the EPA early 
phase PAGs. Therefore, any offsite consequence from a design-basis 
radiological release is unlikely, and a significant amount of offsite 
liability insurance coverage is not required.
    The only beyond design-basis event that has the potential to lead 
to a significant radiological release at a permanently shut down and 
defueled (decommissioning) reactor is a zirconium fire. The zirconium 
fire scenario is a postulated, but highly unlikely, accident scenario 
that involves the loss of water inventory from the SFP, resulting in a 
significant heatup 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 Oyster 
Creek has been permanently shut down.
    In the analysis provided in the Attachment to its submittal dated 
November 6, 2018, as supplemented by letter dated February 13, 2019, 
with Attachment 1, Response to NRC's Request for Additional Information 
and Attachment 2, Zirconium Fire Analysis for Drained Spent Fuel Pool, 
C-1302-226-E310-457, Revision 2, (ADAMS Accession Nos. ML18310A306, and 
ML19044A643, respectively), the licensee compared the conditions for 
the hottest fuel assembly stored in the SFP to a criterion proposed in 
SECY[dash]99[dash]168, ``Improving Decommissioning Regulations for 
Nuclear Power Plants'' (ADAMS Accession No. ML12265A598), applicable to 
offsite emergency response for the unit in the decommissioning process. 
This criterion considers the time for the hottest assembly to heat up 
from 30 degrees Celsius ([deg]C) to 900 [deg]C adiabatically. If the 
heatup time is greater than 10 hours, then offsite emergency 
preplanning involving the plant is not necessary. Based on the limiting 
fuel assembly for decay heat and adiabatic heatup analysis presented in 
Attachment 2, at 9.38 months (285 days) after permanent cessation of 
power operations (i.e., 9.38 months decay time), the time for the 
hottest fuel assembly to reach 900 [deg]C is 10 hours after the 
assemblies have been uncovered. As stated in NUREG-1738, ``Technical 
Study of Spent Fuel Pool Accident Risk at Decommissioning Nuclear Power 
Plants,'' February 2001 (ADAMS Accession No. ML010430066), 900 [deg]C 
is an acceptable temperature to use for assessing onset of fission 
product release under transient conditions (to establish the critical 
decay time for determining availability of 10 hours for deployment of 
mitigation equipment and, if necessary, for offsite agencies to take 
appropriate action to protect the health and safety of the public, if 
fuel and cladding oxidation occurs in air).
    The NRC staff reviewed the calculation to verify that important 
physical properties of materials were within acceptable ranges and the 
results were accurate. The NRC staff determined that physical 
properties were appropriate. Therefore, the NRC staff found that after 
9.38 months (285 days), more than 10 hours would be available before a 
significant offsite release could begin. The NRC staff concluded that 
the adiabatic heatup calculation provided an acceptable method for 
determining the minimum time available for deployment of mitigation 
equipment and, if necessary, implementing measures under a 
comprehensive general emergency plan.
    In this regard, one technical criterion for relieving 
decommissioning reactor licensees from the insurance obligations 
applicable to an operating reactor is a finding that the heat generated 
by the SFP has decayed to the point where the possibility of a 
zirconium fire is highly unlikely.
    This was addressed in SECY-93-127, where the NRC staff concluded 
that there was a low likelihood and reduced short-term public health 
consequences of a zirconium fire once a decommissioning plant's spent 
fuel has sufficiently decayed. In its Staff Requirements Memorandum, 
``Financial Protection Required of Licensees of Large Nuclear Power 
Plants during Decommissioning,'' dated July 13, 1993 (ADAMS Accession 
No. ML003760936), the Commission approved a policy that authorized, 
through the exemption process, withdrawal from participation in the 
secondary insurance layer and a reduction in commercial liability 
insurance coverage to $100 million, when a licensee is able to 
demonstrate that the spent fuel could be air-cooled if the SFP was 
drained of water.
    The NRC staff has used this technical criterion to grant similar 
exemptions to other decommissioning reactors (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]; Kewaunee Power Station, 
published in the Federal Register on March 24, 2015 [80 FR 15638]; and 
Crystal River Unit 3 Nuclear Generation Plant, published in the Federal 
Register on May 6, 2015 [80 FR 26100]).
    Additional discussions of other decommissioning reactor licensees 
that have received exemptions to reduce their primary insurance level 
to $100 million are provided in SECY[dash]96[dash]256, ``Changes to the 
Financial Protection Requirements for Permanently Shutdown Nuclear 
Power Reactors, 10 CFR 50.54(w) and 10 CFR 140.11,'' dated December 17, 
1996 (ADAMS Accession No. ML15062A483). These prior exemptions were 
based on the licensee demonstrating that the SFP could be air-cooled, 
consistent with the technical criterion discussed above.
    The NRC staff has evaluated the issue of zirconium fires in SFPs 
and presented an independent evaluation of a SFP subject to a severe 
earthquake in NUREG-2161, ``Consequence Study of a Beyond-Design-Basis 
Earthquake Affecting the Spent Fuel Pool for a U.S. Mark l Boiling 
Water Reactor,'' September 2014 (ADAMS Accession No. ML14255A365). This 
evaluation concluded that, for a representative boiling-water reactor, 
fuel in a dispersed high-density configuration would be adequately 
cooled by natural circulation air flow within several months after 
discharge from a reactor if the pool was drained of water.
    By letters dated August 22 and December 6, 2017 (ADAMS Accession 
Nos. ML17234A082 and ML17340A708, respectively), Exelon confirmed that 
the plant design and fuel storage configuration considered in NUREG-
2161 were consistent with the Oyster Creek plant design and fuel 
storage configurations to be used in the decommissioning of Oyster 
Creek. The NRC staff independently confirmed that the Oyster Creek fuel 
assembly decay levels are also consistent with the spent fuel 
considered in NUREG-2161. Thus, the NRC staff has determined that after 
9.38 months (285 days) decay, the fuel stored in the Oyster Creek SFP 
will be able to adequately be cooled by air in the unlikely event of 
pool drainage.
    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 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

[[Page 28599]]

offsite insurance. Analyzing when the spent fuel stored in the SFP is 
capable of adequate air-cooling is one measure that demonstrates when 
the probability of a zirconium fire would be exceedingly low.
    The licensee's analyses 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 9.38 
months (285 days) after the certification of permanent cessation of 
operations that the Oyster Creek spent fuel will remain at temperatures 
far below those associated with a significant radiological release.
    In addition, the licensee performed adiabatic heatup analyses, in 
which a complete drainage of the SFP is combined with rearrangement of 
spent fuel rack geometry and/or the addition of rubble to the SFP; this 
type of analysis postulates that decay heat transfer from the spent 
fuel via conduction, convection, or radiation would be impeded. The 
licensee's adiabatic heatup analyses demonstrate that 9.38 months (285 
days) after the certification of permanent cessation of operations, 
there would be at least 10 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.
    In the NRC staff's safety evaluation dated June 11, 2019, 
associated with the NRC's reissuance of exemptions from certain 
emergency planning requirements for Oyster Creek, with a modified 
effective date of 9.38 months (285 days) after the permanent cessation 
of operations, the NRC staff assessed the Exelon accident analyses 
associated with the radiological risks from a zirconium fire at a 
permanently shut down and defueled Oyster Creek site. Based on its 
evaluation of the licensee's adiabatic heatup analyses, the NRC staff 
found that, 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 10 hours from the initiation of the accident 
until the cladding reaches a temperature where offsite radiological 
release might occur. The NRC staff found that 10 hours is sufficient 
time to support deployment of mitigation equipment, consistent with 
plant conditions, to prevent the zirconium cladding from reaching a 
point of rapid oxidation.
    The NRC staff has determined that the licensee's proposed reduction 
in primary offsite liability coverage to a level of $100 million, and 
the licensee's proposed withdrawal from participation in the secondary 
insurance pool for offsite financial protection, are consistent with 
the policy established in SECY-93-127 and subsequent insurance 
considerations resulting from zirconium fire risks, as discussed in 
SECY-00-0145 and SECY-01-0100. The NRC has previously determined in 
SECY-00-0145 that the minimum offsite financial protection requirement 
may be reduced to $100 million and that secondary insurance is not 
required, once it is determined that the spent fuel in the SFP is no 
longer thermal-hydraulically capable of sustaining a zirconium fire 
based on a plant-specific analysis. In addition, the NRC staff notes 
that similar exemptions from these insurance requirements, have been 
granted to other permanently shutdown and defueled power reactors, upon 
satisfactory demonstration that zirconium fire risk from the irradiated 
fuel stored in the SFP is of negligible concern.

A. The Exemption is Authorized by Law

    The PAA, and its implementing regulations in 10 CFR 140.11(a)(4), 
require licensees of nuclear reactors that have a rated capacity of 
100,000 kilowatts electric or more to have and maintain $450 million in 
primary financial protection and to participate in a secondary 
retrospective insurance pool. In accordance with 10 CFR 140.8, the 
Commission may grant exemptions from the regulations in 10 CFR part 
140, as the Commission determines are authorized by law. The legal and 
associated technical basis for granting exemptions from 10 CFR part 140 
are set forth in SECY-93-127. The legal analysis underlying SECY-93-127 
concluded that, upon a technical finding that lesser potential hazards 
exist after termination of operations, the Commission has the 
discretion under the Price-Anderson Act to reduce the amount of 
insurance required of a licensee undergoing decommissioning.
    The NRC staff concludes that the technical criteria for relieving 
Exelon from its existing primary and secondary insurance obligations 
have been met. As explained above, the NRC staff has concluded that no 
reasonably conceivable design-basis accident exists that could cause an 
offsite release greater than the EPA PAGs, and therefore, that any 
offsite consequence from a design-basis radiological release is 
unlikely, and the need for a significant amount of offsite liability 
insurance coverage is unwarranted. Additionally, the NRC staff 
determined that, after 9.38 months (285 days) decay, the fuel stored in 
the Oyster Creek SFP will be able to adequately be cooled by air in the 
unlikely event of pool drainage. Moreover, in 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, the NRC staff has determined that 10 hours 
would be available and is sufficient time to support deployment of 
mitigation equipment, consistent with plant conditions, to prevent the 
zirconium cladding from reaching a point of rapid oxidation. Thus, the 
NRC staff concludes that the fuel stored in the Oyster Creek SFP will 
have decayed sufficiently by the requested effective exemption date of 
9.38 months (285 days) after the certification of permanent cessation 
of operations, to support a reduction in the required insurance 
consistent with SECY-00-0145.
    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, Section 170, or other laws, as amended, which require 
licensees to maintain adequate financial protection. Accordingly, 
consistent with the legal standard presented in SECY-93-127, under 
which decommissioning reactor licensees may be relieved of the 
requirements to carry the maximum amount of insurance available and to 
participate in the secondary retrospective premium pool where there is 
sufficient technical justification, the NRC staff concludes that the 
requested exemption is authorized by law.

B. The Exemption is Otherwise in the Public Interest

    The financial protection limits of 10 CFR 140.11 were established 
to require licensees to maintain sufficient offsite liability insurance 
to ensure adequate funding for offsite liability claims, following an 
accident at an operating reactor. However, the regulation does not 
consider the reduced potential for and consequence of nuclear incidents 
at permanently shutdown and decommissioning reactors.
    The basis provided in SECY-93-127, SECY-00-0145, and SECY-01-0100 
allows licensees of decommissioning plants to reduce their primary 
offsite liability insurance and to withdraw from participation in the 
retrospective rating pool for deferred premium charges. As discussed in 
these documents, once the zirconium fire concern is determined to be 
negligible, possible accident scenario risks at

[[Page 28600]]

permanently shutdown and defueled reactors are greatly reduced, when 
compared to the risks at operating reactors, and the associated 
potential for offsite financial liabilities from an accident are 
commensurately less. The licensee has analyzed and the NRC staff has 
confirmed that the risks of accidents that could result in an offsite 
radiological risk are minimal, thereby justifying the proposed 
reductions in offsite primary liability insurance and withdrawal from 
participation in the secondary retrospective rating pool for deferred 
premium charges.
    Additionally, participation in the secondary retrospective rating 
pool could potentially have adverse consequences on the safe and timely 
completion of decommissioning. If a nuclear incident sufficient to 
trigger the secondary insurance layer occurred at another nuclear power 
plant, the licensee could incur financial liability of up to 
$131,056,000. However, because Oyster Creek is permanently shut down, 
it cannot produce revenue from electricity generation sales to cover 
such a liability. Therefore, such liability if subsequently incurred, 
could significantly affect the ability of the facility to conduct and 
complete timely radiological decontamination and decommissioning 
activities. In addition, as SECY-93-127 concluded, the shared financial 
risk exposure to Exelon is greatly disproportionate to the radiological 
risk posed by Oyster Creek, when compared to operating reactors. The 
reduced overall risk to the public at decommissioning power plants does 
not warrant that Exelon be required to carry full operating reactor 
insurance coverage, after the requisite spent fuel cooling period has 
elapsed following final reactor shutdown. The licensee's proposed 
financial protection limits will maintain a level of liability 
insurance coverage commensurate with the risk to the public. These 
changes are consistent with previous NRC policy as discussed in SECY-
00-0145, and exemptions approved for other decommissioning reactors. 
Thus, the underlying purpose of the regulations will not be adversely 
affected by the reductions in insurance coverage. Accordingly, an 
exemption from participation in the secondary insurance pool and a 
reduction in the primary insurance to $100 million, a value more in 
line with the potential consequences of accidents, would be in the 
public interest in that this assures there will be adequate funds to 
address any of those consequences and helps to assure the safe and 
timely decommissioning of the reactor.
    Therefore, the NRC staff has concluded that the reissued exemption 
from 10 CFR 140.11(a)(4), which would permit Exelon to lower the Oyster 
Creek primary insurance levels and to withdraw from the secondary 
retrospective premium pool at the requested effective date of 9.38 
months (285 days) after the certification of permanent cessation of 
operations, is in the public interest.

C. Environmental Considerations

    The NRC's approval of an 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, 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 the 
requirement to prepare an environmental assessment or environmental 
impact statement, in accordance with 10 CFR 51.22(c)(25).
    Under 10 CFR 51.22(c)(25), granting of an exemption from the 
requirements of any regulation of Chapter I to 10 CFR is a categorical 
exclusion provided that: (i) There is no significant hazards 
consideration; (ii) there is no significant change in the types or 
significant increase in the amounts of any effluents that may be 
released offsite; (iii) there is no significant increase in individual 
or cumulative public or occupational radiation exposure; (iv) there is 
no significant construction impact; (v) there is no significant 
increase in the potential for or consequences from radiological 
accidents; and (vi) the requirements from which an exemption is sought 
involve surety, insurance, or indemnity requirements.
    As the Director, Division of Decommissioning, Uranium Recovery, and 
Waste Programs, Office of Nuclear Material Safety and Safeguards, I 
have determined that reissuing the exemption involves no significant 
hazards consideration, as defined in 10 CFR 50.92, because reducing a 
licensee's offsite liability requirements at Oyster Creek does not: (1) 
Involve a significant increase in the probability or consequences of an 
accident previously evaluated; (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 Oyster 
Creek or site activities. 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 any activities conducted at the site. 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 resulting from 
issuance of the requested exemption. The requirement for offsite 
liability insurance involves surety, insurance, or indemnity matters 
only.
    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 reissuance of this exemption.

IV. Conclusions.

    Accordingly, the Commission has determined that, pursuant to 10 CFR 
140.8, reissuing the exemption originally granted on December 19, 2018, 
is authorized by law and is otherwise in the public interest. 
Therefore, the Commission hereby reissues Exelon an exemption from the 
requirements of 10 CFR 140.11(a)(4) for Oyster Creek. Exelon certified 
that it permanently ceased operation at Oyster Creek on September 17, 
2018. The exemption from 10 CFR 140.11(a)(4) permits Oyster Creek to 
reduce the required level of primary financial protection, from $450 
million to $100 million and to withdraw from participation in the 
secondary layer of financial protection 9.38 months (285 days) after 
the certification of permanent cessation of operations.
    Therefore, the exemption is effective on June 29, 2019 (9.38 months 
(285 days) after Oyster Creek permanently ceased power operations on 
September 17, 2019)

Dated at Rockville, Maryland, this 12 day of June 2019.

    For the Nuclear Regulatory Commission.

RA/

John R. Tappert,
Director, Division of Decommissioning, Uranium Recovery and Waste 
Programs, Office of Nuclear Material Safety and Safeguards.

[FR Doc. 2019-13013 Filed 6-18-19; 8:45 am]
BILLING CODE 7590-01-P