[Federal Register Volume 91, Number 166 (Friday, August 28, 2026)]
[Notices]
[Pages 55628-55631]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2026-17626]
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NUCLEAR REGULATORY COMMISSION
[Docket Nos. 50-616 and 50-617; NRC-2026-0265]
SMR, LLC; Palisades SMR, LLC; Pioneer Units 1 and 2; 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 dated December 31, 2025, from SMR,
LLC, on behalf of Palisades SMR, LLC, a wholly-owned subsidiary of
Holtec International (collectively, Holtec) for approval to allow
construction of permanent support of excavation walls prior to the
issuance of a limited work authorization for Pioneer Units 1 and 2. The
support of excavation walls will remain in place after construction is
complete.
DATES: The exemption was issued on August 28, 2026.
ADDRESSES: Please refer to Docket ID NRC-2026-0265 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-2026-0265. Address
questions about Docket IDs in Regulations.gov to Bridget Curran;
telephone: 301-415-1003; email: [email protected]. For technical
questions, contact the individual(s) 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 ADAMS Public 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: Victoria Huckabay, telephone: 301-415-
5183, email: [email protected] and Jason Lising, telephone 301-
415-1119; email: [email protected]. Both are staff of the Office of
Advanced Reactors at the U.S. Nuclear Regulatory Commission,
Washington, DC 20555-0001.
SUPPLEMENTARY INFORMATION: The text of the exemption is attached.
(Authority: 42 U.S.C. 2011 et seq.)
Dated: August 26, 2026.
For the Nuclear Regulatory Commission.
Victoria Huckabay,
Senior Project Manager, Advanced Reactor Licensing Branch 2, Division
of Advanced Reactor Licensing, Office of Advanced Reactors.
Attachment--Exemption
NUCLEAR REGULATORY COMMISSION
[Docket Nos. 50-616 and 50-617; NRC-2026-0265] SMR, LLC; Palisades SMR,
LLC; Pioneer Units 1 and 2; Exemption
1.0 Background
By letter dated December 31, 2025 (Agency wide Documents Access
and Management System (ADAMS) Accession Number ML25365A983), SMR,
LLC, on behalf of Palisades SMR, LLC, a wholly-owned subsidiary of
Holtec International (collectively, Holtec) submitted to the U.S.
Nuclear Regulatory Commission (NRC) the first part of a phased
construction permit (CP) application, including a limited work
authorization (LWA) request, for a dual-unit
[[Page 55629]]
SMR-300 plant located at the Palisades Energy Center (PEC) in
Covert, Michigan. The units are individually named Pioneer Unit 1
and Pioneer Unit 2. Part 1 of the phased CP application included a
request for an exemption from Title 10 of the Code of Federal
Regulations (10 CFR) Part 50, Section 50.10(c). The NRC staff has
reviewed this request for an exemption, pursuant to 10 CFR 50.12, as
it relates to Holtec's request to allow for construction of support
of excavation (SOE) walls, which will remain in place after
construction is complete, during the excavation for the Pioneer
Units 1 and 2 plant and prior to issuance of an LWA, which is
currently under review by the NRC.
The NRC staff reviewed relevant information provided in the
application to support the LWA request and the exemption request to
determine whether the requested exemption meets the criteria of 10
CFR 50.12(a) and (b). Granting this exemption would not constitute a
commitment by the NRC to issue an LWA or CP for Pioneer Units 1 and
2. Holtec would construct SOE walls, assuming the risk that its LWA
request or Part 2 of the phased CP application (not yet submitted)
may later be denied.
2.0 Request/Action
The proposed action, as described in Holtec's request for an
exemption from 10 CFR 50.10(c), would allow Holtec to construct
permanent retaining walls within an excavation at the Pioneer Units
1 and 2 site which would otherwise be prohibited prior to issuance
of an LWA or a CP. This exemption would authorize Holtec to install
and abandon in place SOE walls including diaphragm walls, soldier
pile soil-mix walls, and perimeter cutoff walls needed to maintain
excavation stability, protect adjacent structures and utilities,
manage groundwater pressures, and ensure personnel safety and
constructability during deep excavations. According to Holtec, these
SOE walls will serve no function in the completed SMR-300 plant and,
because removal would be unnecessary and costly, the SOE walls will
be retired in place and the space between the SOE walls and the
permanent structures will be backfilled to bring the area to grade.
3.0 Discussion
Pursuant to 10 CFR 50.12(a), the Commission may, upon
application by any interested person or upon its own initiative,
grant exemptions from the requirements of 10 CFR part 50 when (1)
the exemption is authorized by law, will not present an undue risk
to public health or safety, and is consistent with the common
defense and security; and (2) when special circumstances are
present.
Under 10 CFR 50.12(b), to issue an exemption from 10 CFR 50.10
that would allow for construction of permanent SOE walls prior to
the issuance of an LWA, the Commission may grant such an exemption
upon considering and balancing the following factors: (1) whether
conduct of the proposed activities will give rise to a significant
adverse impact on the environment and the nature and extent of such
impact, if any; (2) whether redress of any adverse environmental
impact from conduct of the proposed activities can reasonably be
effected should such redress be necessary; (3) whether conduct of
the proposed activities would foreclose subsequent adoption of
alternatives; and (4) the effect of delay in conducting such
activities on the public interest, including the power needs to be
used by the proposed facility, the availability of alternative
sources, if any, to meet those needs on a timely basis, and delay
costs to the applicant and to consumers.
10 CFR 50.12(a)(1): Authorized by Law
This exemption would authorize the Holtec to construct and
abandon in place permanent SOE walls prior to issuance of an LWA for
Pioneer Units 1 and 2. Granting Holtec's proposed exemption will not
otherwise result in a violation of the Atomic Energy Act of 1954, as
amended, the Commission's regulations, or any other law. Therefore,
the NRC staff finds that the exemption is authorized by law.
10 CFR 50.12(a)(1): No Undue Risk to Public Health and Safety
To determine whether the proposed exemption would pose an undue
risk to public health and safety, the NRC staff identified specific
portions from its ongoing safety review of Part 1 of the phased CP
application that could be impacted if the exemption is granted. The
NRC staff identified that Holtec would need to perform certain
actions and gather data related to Geologic Mapping and Geotechnical
Engineering prior to and during the construction of SOE walls, such
that its ability to demonstrate compliance with NRC regulations in
the technically relevant portions of its phased CP application or a
future Operating License (OL) application, would not be foreclosed.
Therefore, the NRC staff evaluated Holtec's proposed methods
relating to these technical areas.
Geologic Mapping
The excavation support structures that Holtec proposes to leave
in place would cover the excavation walls and floor. The NRC staff
reviewed the exemption request to determine whether the proposed
activities would affect Holtec's ability to meet the relevant
regulatory requirements in 10 CFR 50.34 (as referenced in 10 CFR
50.10(d)(3)), 10 CFR 100.21, and 10 CFR 100.23, in its phased CP
application or a future OL application, specifically with respect to
geologic mapping of the foundation-bearing rock unit, including the
floor and walls of the open excavation. Once the excavation support
activities described in the exemption request are completed, direct
geologic mapping of the foundation-bearing rock unit within the open
excavation would no longer be possible. Therefore, the NRC staff
evaluated how Holtec proposes to conduct its activities under the
requested exemption, such that it would not foreclose Holtec's
ability to demonstrate that it meets the technically relevant NRC
requirements in its phased CP application or a future OL
application.
In Section 1.3.4 of Enclosure IV of Part 1 of the phased CP
application (ML25365A989), Holtec stated that geologic mapping of
the excavation is required and acknowledged the need to notify the
NRC staff when the excavation is open for inspection. In a
supplement to the application submitted by letter dated July 23,
2026 (ML26204A398), Holtec further clarified that the statement in
Section 2.5.4.5.1, Excavation, of the Preliminary Safety Analysis
Report (PSAR or LWA PSAR) provided in Enclosure II to the
application (ML25365A987), regarding geologic mapping of exposed
surfaces within the excavation lifts, as well as geologic mapping
conducted when final grades of various excavation areas have been
reached, applies to the activities covered by this exemption
request.
The NRC staff reviewed Holtec's explanation of how geologic
mapping will be performed on exposed surfaces within each excavation
lift and at final grades, consistent with Regulatory Guide (RG)
1.132, ``Geologic and Geotechnical Site Characterization
Investigations for Nuclear Power Plants.'' Based on this review, the
NRC staff concludes that Holtec's approach to conducting geologic
mapping during the progression of excavation activities provides
reasonable assurance that the activities conducted under this
exemption will not foreclose Holtec's ability to demonstrate that
the requirements of 10 CFR 50.34, 10 CFR 100.21, and 10 CFR 100.23
related to geologic mapping would be met for the technically
relevant potions of the NRC staff's review of the phased CP
application, or a future OL application. As a result, the NRC staff
determined that, regarding geologic mapping, approving this
exemption request would not pose an undue risk to public health and
safety.
Geotechnical Engineering
The NRC staff evaluated the geotechnical engineering aspects of
Holtec's exemption request using the criteria in NUREG-0800, Section
2.5.4, ``Stability of Subsurface Materials and Foundations,'' and
the guidance in RG 1.132, and RG 1.138, ``Laboratory Investigations
of Soils and Rocks for Engineering Analysis and Design of Nuclear
Power Plants.'' In performing this evaluation, the NRC staff
reviewed information relevant to this exemption provided in the
application, to determine whether the proposed excavation support
activities would pose an undue risk to public health and safety.
This exemption request describes the installation of SOE walls
to maintain excavation stability, protect adjacent structures and
utilities, control groundwater pressures, and ensure personnel
safety and constructability during excavation. Holtec stated that
the SOE walls will serve no function in the completed SMR-300 plant.
The NRC staff evaluated PSAR Figures 2.532 through 2.537, which
depict the SOE walls relative to safety related structures, and
determined that based on the preliminary design presented in Part 1
of the phased CP application, following backfilling to plant grade,
the SOE walls will remain structurally isolated from safety related
structures and will serve no function after construction is
complete. Further, Holtec stated that the
[[Page 55630]]
presence of retired SOE wall elements will be included in future
soil-structure interaction (SSI) analyses to ensure a conservative
and technically justified representation of subsurface conditions in
the design of safety related structures, systems and components
(SSCs).
As part of its review, the NRC staff examined the LWA PSAR
Section 2.5.4.10.3, ``Lateral Earth Pressures,'' and Table 2.553,
``Lateral Earth Pressure Design Parameters,'' which describe the
development of at rest (K0), active (Ka), and
passive (Kp) lateral earth pressure coefficients for each
soil stratum. These coefficients were derived from site specific
laboratory and field data, including effective friction angle
([oslash]'), unit weight, and, where applicable, undrained shear
strength. These parameters form the basis for calculating lateral
forces acting on the SOE walls and are directly incorporated into
the stability analyses. The NRC staff found that the coefficients
were developed using state of the practice geotechnical engineering
methods, are consistent with the site's stratigraphy, and are
technically justified based on measured soil parameters and
validated against industry standards and regulatory guidance. In
validating these coefficients, the NRC staff confirmed that (1) the
coefficients were developed from site specific, measured soil
parameters obtained through standard laboratory and field
investigation methods; (2) the analytical methods used to compute
K0, Ka, and Kp, were applied in
accordance with the applicable NRC regulatory guidance including
NUREG-0800, Section 2.5.4; RGs 1.132; and RG 1.138; and (3) the
resulting values were evaluated for consistency with the site's
stratigraphy and found to be technically justified through
comparison with published data and accepted geotechnical practice.
The NRC staff also reviewed Holtec's proposed SOE system design
description, which includes diaphragm walls, soldier pile soil mix
walls, and perimeter cutoff walls. The NRC staff noted that the
design incorporates groundwater conditions (including hydrostatic
pressures below the water table), construction surcharges, and
staged excavation using tiebacks or struts as necessary. As
described in the LWA PSAR Section 2.5.4.5, the construction sequence
specifies staged excavation with the installation of bracing
elements at successive levels, consistent with accepted engineering
practice for deep excavations. The NRC staff also noted that Holtec
developed the lateral pressures through layer-by-layer analysis
using site specific geotechnical parameters, ensuring that the SOE
walls are designed to resist all anticipated loading scenarios.
Section 2.5.4.10.3 of the LWA PSAR specifies the monitoring and
quality control measures to be used during excavation, including
inclinometers, piezometers, load cells, and extensometers. The NRC
staff determined that these measures provide reasonable assurance
that deviations from design assumptions will be promptly detected
and addressed.
Conclusion
Based on the evaluation of the exemption request and supporting
technical information in the application, the NRC staff finds that
there is reasonable assurance that the proposed exemption to allow
installation and retirement in place of the SOE walls prior to
issuance of an LWA would not pose an undue risk to public health and
safety and would not adversely affect the safe design or siting of
the plant. This determination is supported by the following:
1. The SOE walls are designed to provide support for the
excavation during construction and will serve no safety related
design function after construction is complete.
2. The area between the SOE walls and safety related structures
will be backfilled to plant grade, providing structural and
functional separation.
3. Holtec stated that it will include the presence of retired
SOE walls in future SSI analyses, ensuring a conservative
representation of subsurface conditions in safety related design, in
the OL application.
4. Holtec stated it will perform comprehensive geologic mapping
and data collection during excavation and will use this information
to demonstrate the structural integrity of the Reactor Building in
the OL application.
For these reasons, the NRC staff has reasonable assurance that
construction of permanent SOE walls prior to issuance of LWA, if
approved, will not adversely affect the performance or safety
function of Pioneer Units 1 and 2 safety related structures and
therefore, the exemption request does not pose an undue risk to
public health and safety in accordance with the criteria of 10 CFR
50.12(a)(1). The NRC staff notes that in order to demonstrate that
Holtec has met the regulatory requirements for the technically
relevant portions of the phased CP application, or future OL
application, Holtec must provide the information provided by this
geologic mapping, and the presence of the retired SOE walls must be
included in future SSI analyses, as technically relevant. Deviations
from the commitments described in this exemption request or failure
to notify the NRC when the excavations are open for inspection could
result the NRC staff being unable to make its required safety
findings pursuant to the Atomic Energy Act to issue an LWA, CP, or
OL.
10 CFR 50.12(a): Consistent With Common Defense and Security
The proposed exemption would allow Holtec to install and abandon
in place SOE walls needed to maintain excavation stability, protect
adjacent structures and utilities, manage groundwater pressures, and
ensure personnel safety and constructability during deep excavations
and prior to issuance of an LWA. Because the exemption would allow
for excavation wall support only, the exemption has no relation to
defense and security issues. Therefore, the common defense and
security is not impacted by this exemption.
10 CFR 50.12(a)(2): Special Circumstances
Special circumstances, in accordance with 10 CFR
50.12(a)(2)(iii), are present whenever ``compliance [with a
regulation] would result in undue hardship or other costs that are
significantly in excess of those contemplated when the regulation
was adopted''. Holtec cited undue hardship or other costs as a
special circumstance that would warrant granting this exemption.
Holtec stated that removal of the excavation supports, which would
make them temporary and therefore not ``construction'' as defined in
10 CFR 50.10(a), would not be practical because of the high
unnecessary cost associated with removal that would be added to the
project. Holtec stated that the delaying of the SOE walls
construction and associated excavation activities until LWA approval
would result in substantial costs by negatively impacting the
construction schedule for the Pioneer Units 1 and 2.
In 2007, the NRC issued a final rule to allow certain
construction activities on production and utilization facilities to
commence before a construction permit or combined license is issued
and modified the scope of activities that are considered
construction for which a construction permit, combined license or
LWA is necessary (2007 LWA rule) (72 FR 57416). The Commission
issued a regulatory analysis associated with the 2007 LWA rule
(ML071870012). In Section 3.2.2 of the regulatory analysis, the
Commission noted that ``[a]pplicants' ability to perform pre-
construction site preparation activities without obtaining prior
permission from the NRC will lower the cost of construction by
reducing the time interval between the outlay of capital for new
plant construction and cost recovery realized through plant
operation. The definition of construction in the final rule will
minimize the time interval by allowing pre-construction, site
preparation activities to proceed in parallel with the NRC's
licensing process.'' The staff noted in the associated SECY to the
2007 LWA rule, SECY-07-0030, that the LWA process allows for certain
construction activities to proceed after a safety review is
performed for the requested foundation activities, including related
site characteristics, and an environmental review is conducted
(ML070310298). The Commission further explained in the preamble to
the 2007 LWA rule, that retaining walls fall within the definition
of construction if they are permanent, but do not if they are
temporary and are removed from the excavation before fuel load (72
FR at 57429).
The NRC staff has conducted safety (Section 3.0 of this
exemption) and environmental (Section 4.0 of this exemption) reviews
for the limited exemption request to install SOE walls and abandon
them in place instead of removing them as temporary retaining walls.
The staff notes that the SOE walls are not intended to serve a
structural purpose in the SMR-300 design and are designed to support
the excavation during construction. Further, the space between the
SOE walls and the SSCs are intended to be backfilled to bring the
area back to planned grade and the SOE walls are planned to be
abandoned in place. Based on the staff's analysis of the preliminary
design for the Pioneer Units 1 and 2, the staff found that the SOE
walls will remain structurally isolated from safety-related
structures and will serve no function after construction is
complete. In the staff's analysis of this
[[Page 55631]]
exemption request, the staff concluded that it has reasonable
assurance that the exemption to allow installation and retirement in
place of the SOE walls prior to issuance of an LWA would not
adversely affect the safe design or siting of the plant. However,
removal of the SOE walls, which would cause the SOE walls to
therefore not be defined as ``construction,'' is not practical for
Holtec to complete for Pioneer Units 1 and 2 because of the high
unnecessary cost and schedule delays that removal would add to the
project. Furthermore, delaying SOE wall construction would also
delay the associated pre-construction excavation activities until
LWA approval, negatively impacting Holtec's construction schedule
and potentially delaying plant operations. Therefore, removal of the
SOE walls or delaying installation of permanent SOE walls until a
LWA is issued, if approved, would not result in the cost benefits
associated with allowing pre-construction and site preparation to
proceed in parallel with the NRC's review of the phased CP
application because it would either delay excavation activities or
require costly removal of the SOE walls at a later date.
Therefore, the NRC staff has determined that special
circumstances exist in this case because compliance with a
regulation, 10 CFR 50.12(a)(2)(iii), would result in undue hardship
and other costs that are significantly in excess of those
contemplated when the regulation was adopted.
10 CFR 50.12(b): Balancing Factors
Pursuant to 10 CFR 50.12(b), the Commission may grant the
exemption upon considering and balancing the following four factors:
(1) whether conduct of the proposed activities will give rise to a
significant adverse impact on the environment and the nature and
extent of such impact, if any; (2) whether redress of any adverse
environment impact from conduct of the proposed activities can
reasonably be effected should such redress be necessary; (3) whether
conduct of the proposed activities would foreclose subsequent
adoption of alternatives; and (4) the effect of delay in conducting
such activities on the public interest, including the power needs to
be used by the proposed facility, the availability of alternative
sources, if any, to meet those needs on a timely basis and delay
costs to the applicant and to consumers. With respect to factor (1),
the NRC staff has prepared an environmental assessment (EA)
(ML26230A249) as discussed in Section 4.0 below and determined that
the proposed action of granting of this exemption will not have a
significant effect on the quality of the human environment.
With respect to factor (2), Holtec stated that should redress be
necessary, the below-grade SOE walls will be retired in place,
backfilled, and graded to conform to the adjacent land surface,
allow stormwater runoff, and prevent soil erosion. The NRC staff
reviewed the redress plan to the extent it discusses construction of
the SOE walls included as Enclosure VIII and found that redress of
the SOE walls can reasonably be effected. Therefore, the NRC staff
determined that redress of any adverse environment impact from
conduct of the proposed activities can reasonably be effected should
redress be necessary.
Additionally, the NRC staff determined that issuance of an LWA
will not foreclose subsequent adoption of alternatives as identified
in factor (3). According to Holtec, retiring the SOE walls in place
includes grading the impacted areas to conform to the adjacent land
surface which will support adoption of subsequent alternatives.
Also, although not anticipated to be necessary for adoption of
subsequent alternatives, Holtec states that the removal of the SOE
walls could be performed but would be costly.
Finally, the NRC staff considered factor (4) and the effect of
delay in conducting construction activities authorized by the
exemption on the public interest and finds that without the
requested exemption, a significant time delay and increased
construction costs could delay construction of Pioneer Units 1 and
2, which could delay 680 mega-watts of clean energy and a reliable
lower cost energy supply for working families and small businesses
in the state of Michigan. Further, the NRC staff reviewed the
exemption request and Holtec's discussion of alternative energy
sources in Chapter 9 of the Environmental Report (ER), (Enclosure
III of the application), as a preliminary assessment of the
information provided, and did not identify any alternative sources
available that would outweigh the potential costs and time delay
from not granting the exemption. Upon consideration and balancing of
the four factors described above, the Commission has determined that
the exemption should be granted.
4.0 Environmental Considerations
In accordance with 10 CFR 51.30, 51.31, and 51.32, 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 issued on August 25, 2026 (91
FR 54890). The ADAMS Accession number for the associated EA is
ML26230A249.
5.0 Conclusion
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 the public health and safety, and is consistent
with the common defense and security. Also, special circumstances
are present. Further, the Commission considered and balanced the
factors of 10 CFR 50.12(b) and determined that the exemption should
be granted. Therefore, the Commission hereby grants Palisades SMR,
LLC, and SMR, LLC an exemption from the requirements in 10 CFR
50.10(c) for the construction of permanent SOE walls during
excavation activities and prior to issuance of an LWA. Issuance of
this exemption shall not be deemed to constitute a commitment to
issue a construction permit or LWA.
This exemption is effective upon issuance.
Dated at Rockville, Maryland, this 28th day of August 2026.
For the Commission
/RA/
Ravi Penmetsa,
Director, Division of Advanced Reactor Science, Office of Advanced
Reactors.
[FR Doc. 2026-17626 Filed 8-27-26; 8:45 am]
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