[Federal Register Volume 89, Number 36 (Thursday, February 22, 2024)]
[Notices]
[Pages 13381-13385]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-03543]


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NUCLEAR REGULATORY COMMISSION

[Docket No. 50-305; NRC-2024-0023]


Kewaunee Solutions, Inc; Kewaunee Power Station; Exemption

AGENCY: Nuclear Regulatory Commission.

ACTION: Notice; issuance.

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SUMMARY: The U.S. Nuclear Regulatory Commission (NRC) has issued an 
exemption in response to a request from Kewaunee Solutions, Inc. that 
would permit it to use funds from the Kewaunee Power Station nuclear 
decommissioning trust for the management of site restoration activities 
and allow trust disbursements for site restoration activities to be 
made without prior notice to the NRC.

DATES: The exemption was issued on January 26, 2024.

ADDRESSES: Please refer to Docket ID NRC-2024-0023 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

[[Page 13382]]

for Docket ID NRC-2024-0023. Address questions about Docket IDs in 
Regulations.gov to Stacy Schumann; telephone: 301-415-0624; 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 (PDR) reference staff at 1-800-397-4209, at 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: The PDR, where you may examine and order copies 
of publicly available documents, is open by appointment. To make an 
appointment to visit the PDR, please send an email to 
[email protected] or call 1-800-397-4209 or 301-415-4737, between 8 
a.m. and 4 p.m. eastern time (ET), Monday through Friday, except 
Federal holidays.

FOR FURTHER INFORMATION CONTACT: Karl Sturzebecher, Office of Nuclear 
Material Safety and Safeguards, U.S. Nuclear Regulatory Commission, 
Washington, DC 20555-0001, telephone: 301-415-8534, email: 
[email protected].

SUPPLEMENTARY INFORMATION: The text of the exemption is attached.

    Dated: February 15, 2024.

    For the Nuclear Regulatory Commission.
Marlayna V. Doell,
Project Manager, 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. 50-305

Kewaunee Solutions, Inc.

Kewaunee Power Station

Exemption

I. Background

    The Kewaunee Power Station (KPS) consists of a permanently shutdown 
and defueled pressurized water reactor located in Kewaunee County, 
Wisconsin. On May 7, 2013, the licensee at that time, Dominion Energy 
Kewaunee (DEK), permanently ceased power operations at KPS. On May 14, 
2013, DEK certified that it had permanently defueled the KPS reactor 
vessel (Agencywide Documents Access and Management System (ADAMS) 
Accession No. ML13135A209). On May 21, 2014 (ML13225A224), the U.S. 
Nuclear Regulatory Commission (NRC) approved an exemption from the 
specific requirements of paragraph (a)(8)(i)(A) of Section 50.82 
``Termination of license,'' of Part 50, ``Domestic Licensing of 
Production and Utilization Facilities,'' of Title 10 of the Code of 
Federal Regulations (10 CFR) and paragraph (h)(1)(iv) of 10 CFR 50.75, 
``Reporting and recordkeeping for decommissioning planning,'' for KPS. 
This exemption authorizes the licensee to use funds from the KPS 
nuclear decommissioning trust (NDT) for the management of spent nuclear 
fuel, and allows trust disbursements for spent fuel management to be 
made without prior NRC notice.
    By letter dated March 29, 2023 (ML23093A031), Kewaunee Solutions, 
Inc., and EnergySolutions, LLC (Kewaunee Solutions and EnergySolutions, 
respectively, or the licensees), submitted, pursuant to 10 CFR 50.12, 
``Specific Exemptions,'' a request for an exemption to 10 CFR 
50.82(a)(8)(i)(A) that would allow KPS to use funds from the NDT for 
site restoration activities. Pursuant to 10 CFR 50.12, the licensees 
also requested an exemption from 10 CFR 50.75(h)(1)(iv), which would 
allow trust disbursements for site restoration activities to be made 
without prior notice to the NRC, similar to withdrawals in accordance 
with 10 CFR 50.82(a)(8) for decommissioning activities.
    By letter dated October 5, 2023 (ML23278A100), the licensees 
provided a response to an NRC request for additional information (RAI), 
dated August 29, 2023 (ML23222A152), pertaining to decommissioning 
trust fund (DTF) cash flows that were provided in the initial exemption 
request submittal. The funds within the DTF were collected in 
compliance with the 10 CFR 50.75 financial requirements while KPS was 
operating. The licensees included with the exemption request a cash 
flow analysis reflecting the balance of funds within the trust 
throughout the decommissioning period, based upon a DECON 
decommissioning method ending in 2055, which is the year of anticipated 
license termination.

II. Request/Action

    The request for an exemption from the requirements of 10 CFR 
50.82(a)(8)(i)(A) and 10 CFR 50.75(h)(1)(iv) would allow the licensees 
to use funds from the KPS NDT for the management of site restoration 
activities and allow trust disbursements for site restoration 
activities to be made without prior notice to the NRC. The licensee's 
initial basis for the exemption request relied upon financial and other 
decommissioning data reflected in a May 13, 2021, letter from 
EnergySolutions titled ``Notification of Amended Post Shutdown 
Decommissioning Activities Report (Revision 2) for Kewaunee Power 
Station'' (ML21145A083), as well as on decommissioning cost estimate 
data provided with that letter. However, during the course of its 
review the NRC staff concluded that the status of funding in the KPS 
DTF had changed since submission of the May 13, 2021, letter. 
Specifically, the NRC staff noted that there were significant 
differences in the expenditure and cash flow data reported in the Post-
Shutdown Decommissioning Activities Report (PSDAR) and site-specific 
decommissioning cost estimate (SSDCE) that formed the basis of the 
exemption request, and a more recent DTF Status Report, dated March 30, 
2023 (ML23089A304), for the KPS NDT, which reflects financial data 
through December 31, 2022. Therefore, the NRC staff raised a concern 
that the PSDAR and SSDCE data on which the NRC was to base its analysis 
of the portion of the exemption request relating to the requirement in 
10 CFR 50.82(a)(8)(i)(A), to allow use of funds from the KPS NDT for 
site restoration activities, was outdated, and thus did not provide the 
timely information necessary for the staff to complete its analysis.
    Subsequently, the NRC staff requested additional information from 
the licensees in an RAI letter dated August 29, 2023, requesting, in 
part, ``. . . revised license termination, spent fuel management, and 
site restoration plans, including forecasted cash flow expenditure 
data, that reflect Kewaunee Solution's current assumptions about the 
decommissioning method, decommissioning activities, and the schedule of 
such activities for KPS,'' so that the staff could perform its analysis 
of the requested exemption with more timely data. The licensees 
responded by letter dated October 5, 2023, explaining that the basis 
for demonstrating adequate funding for the exemption request is 
provided in (1) the March 30, 2023, KPS DTF Status Report, which 
includes detailed license termination, spent fuel management, and site 
restoration costs; and (2) the total forecasted expenditure data 
provided in

[[Page 13383]]

the RAI response, which is based on the DECON decommissioning method 
and the current schedule for decommissioning and license termination 
activities for KPS.
    The requirement at 10 CFR 50.82(a)(8)(i)(A) restricts withdrawals 
from an NDT to expenses for legitimate decommissioning activities 
consistent with the definition in 10 CFR 50.2, ``Definitions.'' The 
definition of ``decommission'' in 10 CFR 50.2 does not include 
activities associated with site restoration. Specifically, 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.''
    The requirement at 10 CFR 50.75(h)(1)(iv) also restricts 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. While the NRC previously approved an 
exemption for KPS to use funds from the KPS NDT for the management of 
spent fuel, an additional exemption from 10 CFR 50.82(a)(8)(i)(A) and 
10 CFR 50.75(h)(1)(iv) is needed to allow the licensees to use funds 
from the KPS NDT for site restoration activities at KPS. The 
requirement at 10 CFR 50.75(h)(1)(iv) further provides 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 the licensees to use funds from the KPS NDT for 
site restoration activities at KPS 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:

    (ii) 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
    (iii) 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 the requirements of 10 CFR 
50.82(a)(8)(i)(A) and 10 CFR 50.75(h)(1)(iv) would allow the licensees 
to use a portion of the funds from the KPS DTF for site restoration 
activities at KPS without prior notice to the NRC, in the same manner 
that withdrawals are made under 10 CFR 50.82(a)(8) for decommissioning 
activities and through use of a previously authorized exemption for KPS 
spent fuel management 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 licensees' 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 licensees' PSDAR, SSDCE, the most recent KPS DTF 
Status Report, additional information provided by the licensees in 
response to the NRC staff's RAI on this exemption request, and 
conclusions reached by the NRC staff in its independent cash flow 
analysis, the use of a portion of the KPS DTF for site restoration 
activities at KPS will not adversely impact the licensees' ability to 
complete radiological decommissioning within 60 years and terminate the 
KPS license. Furthermore, an exemption from 10 CFR 50.75(h)(1)(iv) to 
allow KPS to make withdrawals from the DTF for site restoration 
activities without prior written notification to the NRC will not 
affect the sufficiency of funds in the DTF to accomplish radiological 
decommissioning. This is 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). 
Therefore, KPS decommissioning trust funds, in accordance with 10 CFR 
50.82(a)(8)(i)(B)-(C), may only be used by the licensee if: (1) an 
expenditure would not reduce the value of the decommissioning trust 
below an amount necessary to place and maintain the reactor in a safe 
storage condition if unforeseen conditions or expenses arise and; (2) 
the withdrawals would not inhibit the ability of the licensees to 
complete funding of any shortfalls in the DTF needed to ensure the 
availability of funds to ultimately release the site and terminate the 
license.
    Based on the NRC staff's analysis of the information provided in 
support of this exemption request, as supplemented, there are no new 
accident precursors created by using the DTF in the proposed manner. 
Thus, the probability of postulated accidents is not increased. In 
addition, 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 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 the licensees to use funds from 
the KPS NDT for the management of site restoration activities and allow 
trust disbursements for site restoration activities to be made without 
prior notice to the NRC. Spent fuel management under paragraph (bb) of 
10 CFR 50.54, ``Conditions of licenses,'' is an integral part of the 
planned KPS decommissioning and license termination process; the NRC 
previously approved an exemption for KPS to use funds from the KPS NDT 
for the management of spent fuel. The current change, to enable the use 
of a portion of the funds from the DTF for site restoration activities, 
and to do so without prior written NRC notification, 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

[[Page 13384]]

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 the DTF to expenses 
for radiological decommissioning activities, is to provide reasonable 
assurance that adequate funds will be available to complete 
radiological decommissioning of power reactors and achieve license 
termination. Strict application of these requirements would prohibit 
the withdrawal of funds from the KPS DTF for activities other than 
radiological decommissioning activities at KPS, such as for spent fuel 
management and site restoration activities, until final radiological 
decommissioning at KPS has been completed. As noted above, the NRC 
previously approved an exemption for the licensees to use funds from 
the KPS NDT for the management of spent fuel on May 21, 2014.
    According to the March 30, 2023, KPS DTF Status Report, the DTF for 
KPS contained $745.6 million as of December 31, 2022. The licensees' 
analysis projects that the total remaining radiological decommissioning 
costs at KPS will be approximately $654 million (2023 dollars), 
including the costs for decommissioning the onsite independent spent 
fuel storage installation (ISFSI). As required by 10 CFR 50.54(bb), the 
licensees estimated the costs associated with spent fuel management at 
KPS to be $36.1 million (2023 dollars). Site restoration costs are 
estimated at $38.1 million (2023 dollars). This reflects a total 
remaining estimated cost of approximately $728.2 million for 
radiological decommissioning, spent fuel management, and site 
restoration activities, with license termination anticipated in 2055. 
In its analysis, the NRC staff assumed a 2 percent annual real rate of 
return on the DTF balance as allowed by 10 CFR 50.75(e)(1)(ii), and 
determined the projected earnings of the DTF.
    The NRC staff's independent cash flow analysis projects that the 
KPS DTF will contain approximately $84.3 million following completion 
of radiological decommissioning activities at the site (year 2031), and 
$122.9 million at the end of all license termination, spent fuel 
management, and site restoration activities (year 2055), when 
considering use of the KPS DTF for payment of spent fuel management and 
site restoration expenses. The NRC staff's analysis aligns with the 
cash flow analysis provided by the licensees in their submittals. Tax 
liabilities related to DTF investments are not reflected in the NRC 
staff's analysis.
    The NRC staff confirmed that the current funds and projected 
earnings of the KPS DTF provide reasonable assurance of adequate 
funding to complete all NRC-required radiological; decommissioning 
activities at KPS, as well as to pay for spent fuel management and site 
restoration activities. Therefore, the NRC staff finds that the 
licensees have provided reasonable assurance that adequate funds will 
be available for the radiological decommissioning of KPS, 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), in addition to application of a previously authorized 
exemption for spent fuel management activities at KPS, which provide 
that funds from the DTF only be used for radiological decommissioning 
activities and not for 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, the licensees 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 the 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), 10 CFR 50.82(a)(8), and by the previously approved 
exemption for spent fuel management expenditures from the DTF, which 
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 licensees' submittal dated March 29, 2023, are authorized. As 
stated previously, the NRC staff determined that there are sufficient 
funds in the KPS DTF to complete radiological decommissioning 
activities, as well as to conduct spent fuel management and site 
restoration activities, consistent with the licensees' PSDAR and SSDCE, 
dated May 13, 2021, as well as the information provided in support of 
its exemption request, as supplemented.
    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 DTF 
Status Report must include additional financial assurance to cover the 
estimated cost of completion of radiological decommissioning 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 decommissioning.
    The requested exemption would not allow the withdrawal of funds 
from the KPS DTF for any purpose that is not currently authorized in 
the regulations, or that has previously been authorized by exemption 
from the NRC, without prior notification to the NRC. Therefore, the 
granting of the exemption to 10 CFR 50.75(h)(1)(iv) to allow the 
licensees to make withdrawals from the KPS DTF to cover authorized 
expenses for 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 licensees state, and the NRC 
staff has confirmed, that the KPS DTF contains funds in excess of the 
estimated costs of radiological decommissioning. The licensees further 
state 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 NDT in excess of those needed for radiological decommissioning 
for other purposes, such as spent fuel management or site restoration 
activities.
    The NRC has previously 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

[[Page 13385]]

management and site restoration activities (see NRC Regulatory Issue 
Summary 2001-07, ``10 CFR 50.75 Reporting and Recordkeeping for 
Decommissioning Planning,'' Revision 1, dated January 8, 2009 
(ML083440158), and Regulatory Guide 1.184, ``Decommissioning of Nuclear 
Power Reactors,'' Revision 1, dated October 2013 (ML13144A840)). 
Preventing access to those excess funds in DTFs 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 
KPS DTF to cover the cost of activities associated with site 
restoration, in addition to radiological decommissioning and spent fuel 
management, is supported by the licensees' SSDCE for KPS. If the KPS 
DTF cannot be used for site restoration activities, the licensees would 
need to obtain additional funding that would not be recoverable from 
the DTF, or would have to modify the decommissioning approach and 
methods planned at KPS. 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 purpose of 10 CFR 50.82(a)(8)(i)(A) and 10 CFR 
50.75(h)(1)(iv) would continue to be achieved by allowing the licensees 
to use a portion of the KPS DTF for 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 (iii) 
exist and support the approval of the requested exemption.

E. Environmental Considerations

    In accordance with paragraph (a) of 10 CFR 51.31, ``Determinations 
based on environmental assessment,'' the Commission has determined that 
the granting of this exemption will not have a significant effect on 
the quality of the human environment, as discussed in the NRC staff's 
Environmental Assessment and Finding of No Significant Impact published 
on January 25, 2024 (89 FR 4999).

IV. Conclusion

    In consideration of the above, the NRC staff finds that the 
proposed exemption confirms the adequacy of funding in the KPS DTF, 
considering growth, to complete radiological decommissioning of the 
site and to terminate the license, as well as to cover the estimated 
costs of spent fuel management and site restoration activities.
    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 Kewaunee Solutions, Inc., and 
EnergySolutions, LLC an exemption from the requirements of 10 CFR 
50.82(a)(8)(i)(A) and 10 CFR 50.75(h)(1)(iv) to allow the use of a 
portion of the funds from the KPS DTF for site restoration activities 
in accordance with (1) the licensees' PSDAR and SSCE, (2) forecasted 
cost and scheduling information from the most recent KPS DTF Status 
Report, and (3) as provided in response to the NRC's RAI on this 
exemption request. Additionally, the Commission hereby grants the 
licensees an exemption from the requirement of 10 CFR 50.75(h)(1)(iv) 
to allow such withdrawals from the KPS DTF for site restoration 
activities without prior NRC notification.
    This exemption is effective upon issuance.

    Dated: January 26, 2024.

    For the Nuclear Regulatory Commission.

/RA/

Jane Marshall,
Director, Division of Decommissioning, Uranium Recovery, and Waste 
Programs, Office of Nuclear Material Safety and Safeguards.

[FR Doc. 2024-03543 Filed 2-21-24; 8:45 am]
BILLING CODE 7590-01-P