[Federal Register Volume 85, Number 161 (Wednesday, August 19, 2020)]
[Notices]
[Pages 51072-51075]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-18078]


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NUCLEAR REGULATORY COMMISSION

[Docket No. 50-331; NRC-2020-0189]


NextEra Energy Duane Arnold, LLC; Duane Arnold Energy Center

AGENCY: Nuclear Regulatory Commission.

ACTION: Exemption; issuance.

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SUMMARY: The U.S. Nuclear Regulatory Commission (NRC) is issuing an 
exemption in response to a February 25, 2020, as supplemented by letter 
dated May 29, 2020, request from NextEra Energy Duane Arnold, LLC 
(NEDA, the licensee). The issuance of the exemption would permit NEDA 
to use funds from the Duane Arnold Energy Center (DAEC) decommissioning 
trust fund (DTF) for spent fuel management and site restoration 
activities and without prior notification of the NRC.

DATES: The exemption was issued on August 12, 2020.

ADDRESSES: Please refer to Docket ID NRC-2020-0189 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 https://www.regulations.gov/ and search for Docket ID NRC-2020-0189. Address 
questions about NRC docket 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 https://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 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.

FOR FURTHER INFORMATION CONTACT: Scott P. Wall, Office of Nuclear 
Reactor Regulation, U.S. Nuclear Regulatory Commission, Washington, DC 
20555-0001; telephone: 301-415-2855; email: [email protected].

SUPPLEMENTARY INFORMATION: The text of the exemption is attached.

    Dated August 13, 2020.

    For the Nuclear Regulatory Commission.
Scott P. Wall,
Senior Project Manager, Plant Licensing Branch III, Division of 
Operating Reactor Licensing, Office of Nuclear Reactor Regulation.

Attachment--Exemption

Nuclear Regulatory Commission

Docket No. 50-331

NextEra Energy Duane Arnold, LLC, Duane Arnold Energy Center, Exemption

I. Background

    Duane Arnold Energy Center (DAEC) is a single boiling-water reactor 
located in Linn County, Iowa. Under Renewed Facility Operating License 
No. DPR-49, DAEC is owned by NextEra Energy Duane Arnold, LLC (NEDA, 
the licensee) (70%), Central Iowa Power Cooperative (20%), and Corn 
Belt Power Cooperative (10%) and is operated by NEDA. This license is 
subject to the rules, regulations, and orders of the U.S. Nuclear 
Regulatory Commission (NRC, the Commission).
    By letter dated January 18, 2019 (Agencywide Documents Access and 
Management System (ADAMS) Accession No. ML19023A196), NEDA 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), stating its 
determination to permanently cease power operations at DAEC in the 
fourth quarter of 2020. By letter dated March 2, 2020 (ADAMS Accession 
No. ML20062E489), NEDA updated this certification, stating that it 
plans to permanently cease power operations at DAEC on October 30, 
2020. By letter dated April 2, 2020 (ADAMS Accession No. ML20094F603), 
NEDA submitted to the NRC a Post-Shutdown Decommissioning Activities 
Report (PSDAR) and site-specific Decommissioning Cost Estimate (DCE) 
for DAEC in accordance with 10 CFR 50.82(a)(4)(i).

II. Request/Action

    By letter dated February 25, 2020 (ADAMS Accession No. 
ML20056E054), as supplemented by letter dated May 29, 2020 (ADAMS 
Accession No. ML20153A371), NEDA submitted to the NRC a request for 
exemption from specific requirements of 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) and 10 
CFR 50.75(h)(1)(iv) would permit NEDA to make withdrawals from the DAEC 
Decommissioning Trust Fund (DTF) for spent fuel management and site 
restoration activities in accordance with the DAEC DCE. The exemption 
from 10 CFR 50.75(h)(1)(iv) would also permit NEDA 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).
    As part of its exemption request, NEDA provided Table 1, ``Annual 
SAFSTOR Decommissioning Cost Cash Flow for Duane Arnold Energy 
Center,'' that shows the annual DTF cash flow for DAEC while conducting 
SAFSTOR decommissioning (i.e., deferred dismantling). Table 1 contains 
the projected withdrawals from the DTF needed to cover the estimated 
costs of radiological decommissioning, spent fuel management, and site 
restoration activities as projected as of the date of the exemption 
request. Subsequent to its exemption request, NEDA provided the DTF 
balance and cost estimates for these same activities in its letter 
dated April 2, 2020 for the DAEC PSDAR and in Enclosure 1 to its March 
26, 2020 annual report on the status of decommissioning funding for 
DAEC (ADAMS Accession No. ML20086L916). On May 29, 2020, NEDA 
supplemented its request and provided, among other things, the most 
recently available NEDA DAEC DTF balance. 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 the use of 
DTF withdrawals to expenses for legitimate decommissioning activities 
consistent with the definition of decommissioning that appears in 10 
CFR 50.2. The

[[Page 51073]]

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 spent 
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) and 10 
CFR 50.75(h)(1)(iv) is needed to allow NEDA to use funds from the DAEC 
DTF for spent fuel management and site restoration activities at DAEC. 
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 NEDA to use funds from the DAEC DTF for spent fuel 
management and site restoration activities at DAEC 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. Authorized by Law

    The requested exemption from 10 CFR 50.82(a)(8)(i)(A) and 10 CFR 
50.75(h)(1)(iv) would allow NEDA to use a portion of the funds from the 
DAEC DTF for spent fuel management and site restoration activities at 
DAEC 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 exemption will not result 
in a violation of the Atomic Energy Act of 1954, as amended, or the 
Commission's regulations. Therefore, the exemption is authorized by 
law.

B. No Undue Risk to 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 DAEC DTF for spent fuel management and site 
restoration activities at DAEC will not adversely impact NEDA's ability 
to complete radiological decommissioning within 60 years and terminate 
the DAEC license. Furthermore, an exemption from 10 CFR 50.75(h)(1)(iv) 
to allow the licensee to make withdrawals from the DTF for spent 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).
    Based on the above, there are no new accident precursors created by 
using the DTF in the proposed manner. Thus, the probability and 
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 exemption will not present 
an undue risk to public health and safety.

C. Consistent With the Common Defense and Security

    The requested exemption would allow NEDA to use funds from the DAEC 
DTF for spent fuel management and site restoration activities at DAEC. 
Spent fuel management under 10 CFR 50.54(bb) is an integral part of the 
planned NEDA decommissioning and license termination process and will 
not adversely affect NEDA'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 spent fuel management and site 
restoration activities has no relation to security issues. Therefore, 
the common defense and security is not impacted by the requested 
exemption.

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 DAEC DTF for activities other than radiological 
decommissioning activities at DAEC, such as for spent fuel management 
and site restoration activities, until final radiological 
decommissioning at DAEC has been completed.
    The aggregate DAEC DTF balances across all licensed owners as of 
December 31, 2019 was $568,294,503. The NEDA DAEC DTF balance as of 
Decemeber 31, 2019 was $454,453,798. This amount represents NEDA's 70% 
ownership of DAEC. In its letter dated May 29, 2020, NEDA provided an 
updated NEDA DAEC DTF balance of $416,135,029 as of April 30, 2020. The 
NEDA analysis projects the total radiological decommissioning cost of 
DAEC to be approximately $724,688,000 in 2018 dollars. As required by 
10 CFR 50.54(bb), NEDA estimated the costs associated with spent fuel 
management at DAEC to be $259,466,000 in 2018 dollars.
    The NRC staff performed an independent cash flow analysis of the 
DAEC DTF over the 60-year SAFSTOR

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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 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 spent fuel management and site restoration activities. 
Therefore, the NRC staff finds that NEDA has provided reasonable 
assurance that adequate funds will be available for the radiological 
decommissioning of DAEC, even with the disbursement of funds from the 
DTF for spent 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 spent 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, NEDA 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 exemption 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 February 25, 2020, as supplemented 
by letter dated May 29, 2020, 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 
spent fuel management and site restoration activities consistent with 
the PSDAR, DCE, and the February 25, 2020, as supplemented by letter 
dated May 29, 2020, 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 spent fuel management. 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-
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 the exemption 
to 10 CFR 50.75(h)(1)(iv) to allow the licensee to make withdrawals 
from the DTF to cover authorized expenses for spent 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 spent 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 
spent fuel management or site restoration activities.
    The NRC has stated that funding for spent 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 spent 
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, Revision 
1, ``Decommissioning of Nuclear Power Reactors,'' dated October 2013 
(ADAMS Accession No. ML13144A840)). Preventing access to those excess 
funds in the DTF because spent 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 spent 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 
spent 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.
    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 NEDA to use a portion of 
the DAEC DTF for spent fuel management and site restoration activities 
without prior NRC notification, and 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. 
Thus, 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 
exemption.

E. Environmental Considerations

    In accordance with 10 CFR 51.31(a), the Commission has determined 
that the granting of the exemption 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 August 4, 2020 (85 FR 47255).

IV. Conclusions

    In consideration of the above, the NRC staff finds that the 
proposed exemption confirms the adequacy of funding in the DAEC 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.

[[Page 51075]]

    Accordingly, the Commission has determined that, pursuant to 10 CFR 
50.12(a), the exemption is authorized by law, will not present an undue 
risk to public health and safety, and is consistent with the common 
defense and security. Also, special circumstances are present. 
Therefore, the Commission hereby grants NEDA an exemption 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 DAEC DTF for spent fuel 
management and site restoration activities in accordance with the DAEC 
PSDAR and DCE, dated April 2, 2020. Additionally, the Commission hereby 
grants NEDA an exemption from the requirement of 10 CFR 50.75(h)(1)(iv) 
to allow such withdrawals without prior NRC notification.
    This exemption is effective upon issuance.

    Dated: 12th day of August 2020.

    For the Nuclear Regulatory Commission.

Craig G. Erlanger,
Director, Division of Operating Reactor Licensing, Office of Nuclear 
Reactor Regulation.

[FR Doc. 2020-18078 Filed 8-18-20; 8:45 am]
BILLING CODE 7590-01-P