80 FR 15638 - Dominion Energy Kewaunee, Inc.; Kewaunee Power Station

NUCLEAR REGULATORY COMMISSION

Federal Register Volume 80, Issue 56 (March 24, 2015)

The U.S. Nuclear Regulatory Commission (NRC) is issuing an exemption from certain power reactor liability insurance requirements in response to a request from Dominion Energy Kewaunee, Inc. (DEK or the licensee) dated March 20, 2014. This exemption would permit the licensee to reduce its primary offsite liability insurance and withdraw from participation in the secondary retrospective rating pool for deferred premium charges.

[Federal Register Volume 80, Number 56 (Tuesday, March 24, 2015)]
[Notices]
[Pages 15638-15641]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-06730]


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NUCLEAR REGULATORY COMMISSION

[Docket No. 50-305; NRC-2015-0068]


Dominion Energy Kewaunee, Inc.; Kewaunee Power Station

AGENCY: Nuclear Regulatory Commission.

ACTION: Exemption; issuance.

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SUMMARY: The U.S. Nuclear Regulatory Commission (NRC) is issuing an 
exemption from certain power reactor liability insurance requirements 
in response to a request from Dominion Energy Kewaunee, Inc. (DEK or 
the licensee) dated March 20, 2014. This exemption would permit the 
licensee to reduce its primary offsite liability insurance and withdraw 
from participation in the secondary retrospective rating pool for 
deferred premium charges.

DATES: March 24, 2015.

ADDRESSES: Please refer to Docket ID NRC-2015-0068 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 Web site: Go to http://www.regulations.gov and search for Docket ID NRC-2015-0068. Address 
questions about NRC dockets to Carol Gallagher; telephone: 301-415-
3463; email: [email protected]. For technical questions, contact 
the individual listed in the FOR FURTHER INFORMATION CONTACT section of 
this document.
     NRC's Agencywide Documents Access and Management System 
(ADAMS): You may obtain publicly-available documents online in the 
ADAMS Public Documents collection at http://www.nrc.gov/reading-rm/adams.html. To begin the search, select ``ADAMS Public Documents'' and 
then select ``Begin Web-based ADAMS Search.'' For problems with ADAMS, 
please contact the NRC's Public Document Room (PDR) reference staff at 
1-800-397-4209, 301-415-4737, or by email to [email protected]. The 
ADAMS accession number for each document referenced (if it available in 
ADAMS) is provided the first time that a document is referenced.
     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: William Huffman, Office of Nuclear 
Reactor Regulation, U.S. Nuclear Regulatory Commission, Washington, DC 
20555-0001; telephone: 301-415-2046; email: [email protected].

SUPPLEMENTARY INFORMATION: 

I. Background

    The Kewaunee Power Station (KPS) facility is a decommissioning 
power reactor located on approximately 900 acres in Carlton (Kewaunee 
County), Wisconsin, 27 miles southeast of Green Bay, Wisconsin. The 
licensee, DEK, is the holder of the KPS Renewed Facility Operating 
License No. DPR-43. The license provides, among other things, that the 
facility is subject to all rules,

[[Page 15639]]

regulations, and orders of the NRC now or hereafter in effect.
    By letter dated February 25, 2013 (ADAMS Accession No. 
ML13058A065), DEK submitted a certification to the NRC indicating it 
would permanently cease power operations at KPS on May 7, 2013. On May 
7, 2013, DEK permanently shut down the KPS reactor. On May 14, 2013, 
DEK certified that it had permanently defueled the KPS reactor vessel 
(ADAMS Accession No. ML13135A209). As a permanently shutdown and 
defueled facility, and in accordance with Sec.  50.82(a)(2) of Title 10 
of the Code of Federal Regulations (10 CFR), KPS is no longer 
authorized to operate the reactor or emplace nuclear fuel into the 
reactor vessel. The licensee is still authorized to possess and store 
irradiated nuclear fuel. Irradiated fuel is currently being stored 
onsite in a spent fuel pool (SFP) and in independent spent fuel storage 
installation dry casks.

II. Request/Action

    Pursuant to 10 CFR 140.8, ``Specific exemptions,'' DEK has 
requested an exemption from 10 CFR 140.11(a)(4), by letter dated March 
20, 2014 (ADAMS Accession No. ML14090A112). The exemption from 10 CFR 
140.11(a)(4) would permit the licensee to reduce the required level of 
primary offsite liability insurance from $375 million to $100 million, 
and would allow DEK to withdraw from participation in the secondary 
financial protection (also known as the secondary retrospective rating 
pool for deferred premium charges).
    The regulation in 10 CFR 140.11(a)(4) requires each licensee to 
have and maintain financial protection. For a single unit reactor site, 
which has a rated capacity of 100,000 kilowatts electric or more, 10 
CFR 140.11(a)(4) requires the licensee to maintain $375 million in 
primary financial protection. In addition, the licensee is required to 
participate in a secondary retrospective rating pool (secondary 
financial protection) that commits each licensee to additional 
indemnification for damages that may exceed primary insurance coverage. 
Participation in the secondary retrospective rating pool could 
potentially subject DEK to deferred premium charges up to a maximum 
total deferred premium of $121,255,000 with respect to any nuclear 
incident at any operating nuclear power plant, and up to a maximum 
annual deferred premium of $18,963,000 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 require insurance indemnification is commensurately lower. 
Therefore, DEK is requesting 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 secondary financial protection pool.

III. Discussion

    Pursuant to 10 CFR 140.8, the Commission may, upon application by 
any interested person or upon its own initiative, grant exemptions from 
the requirements of 10 CFR part 140, when the exemptions are authorized 
by law and are otherwise in the public interest.
    The financial protection limits of 10 CFR 140.11(a)(4) were 
established to require a licensee to maintain sufficient insurance to 
satisfy liability claims by members of the public for personal injury, 
property damage, or the legal cost associated with lawsuits, as the 
result of a nuclear accident. The insurance levels established by this 
regulation were derived from the risks and potential consequences of an 
accident at an operating reactor with a rated capacity of 100,000 
kilowatts electric (or greater). During normal power reactor 
operations, the forced flow of water through the reactor coolant system 
(RCS) removes heat generated by the reactor. The RCS, operating at high 
temperatures and pressures, transfers this heat through the steam 
generator tubes converting non-radioactive feedwater to steam, which 
then flows to the main turbine generator to produce electricity. Many 
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 KPS and the permanent 
removal of the fuel from the reactor core, such accidents are no longer 
possible. The reactor, RCS, 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, RCS, or supporting systems are no longer applicable.
    During reactor decommissioning, the principal radiological risks 
are associated with the storage of spent fuel onsite. In its March 20, 
2014, exemption request, DEK discusses both design-basis and beyond 
design-basis events involving irradiated fuel stored in the SFP. The 
licensee states that there are no possible design-basis events at KPS 
that could result in an offsite radiological release exceeding the 
limits established by the U.S. Environmental Protection Agency's early-
phase Protective Action Guidelines of 1 rem (roentgen equivalent man) 
at the exclusion area boundary. The only accident that might lead to a 
significant radiological release at a decommissioning reactor is a 
zirconium fire. The zirconium fire scenario is a postulated, but highly 
unlikely, beyond design-basis accident scenario that involves loss of 
water inventory from the SFP, resulting in a significant heat-up 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 KPS has been permanently shut 
down.
    The licensee provided a detailed analysis of the events that could 
result in an offsite radiological release at KPS in its January 16, 
2014, submittal to the NRC (ADAMS Accession No. ML14029A076). One of 
these beyond design-basis accidents involves a complete loss of SFP 
water inventory, where cooling of the spent fuel would be primarily 
accomplished by natural circulation of air through the uncovered spent 
fuel assemblies. The licensee's analysis of this accident shows that by 
October 30, 2014, air-cooling of the spent fuel assemblies will be 
sufficient to keep the fuel within a safe temperature range 
indefinitely without fuel damage or offsite radiological release. This 
is important because the Commission has previously authorized a lesser 
amount of liability insurance coverage, based on an analysis of the 
zirconium fire risk. 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 staff outlined a 
policy for reducing required liability insurance coverage for 
decommissioning reactors. The discussions in SECY-93-127 centered 
primarily on the public health and safety risks associated with storing 
fuel in spent fuel pools. In its Staff Requirements Memorandum dated 
July 13, 1993, the Commission approved a policy that would permit 
reductions in commercial liability insurance coverage, when a licensee 
was able to demonstrate

[[Page 15640]]

that the spent fuel could be air-cooled if the SFP was drained of 
water. Upon demonstration of this technical criterion, the Commission 
policy allowed decommissioning licensees to withdraw from participation 
in the secondary insurance protection layer, and permitted reductions 
in the required amount of commercial liability insurance coverage to 
$100 million. The staff has used this technical criterion to grant 
similar exemptions to other decommissioning reactor licensees (e.g., 
Maine Yankee Atomic Power Station, published in the Federal Register on 
January 19, 1999 (64 FR 2920); and Zion Nuclear Power Station, 
published in the Federal Register on December 28, 1999 (64 FR 72700)). 
Additional discussions of other decommissioning reactor licensees that 
have received exemptions to reduce their primary insurance level to 
$100 million is provided in SECY-96-256, ``Changes to Financial 
Protection Requirements for Permanently Shutdown Nuclear Power 
Reactors, 10 CFR 50.54(w)(1) 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.
    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 the Spent Fuel Pool,'' dated June 4, 2001 (ADAMS 
Accession Nos. ML003721626 and ML011450420, respectively), the staff 
discussed additional information concerning SFP zirconium fire risks at 
decommissioning reactors and associated implications for offsite 
insurance. Analyzing when the spent fuel stored in the SFP is capable 
of air-cooling is one measure that demonstrates when the probability of 
a zirconium fire would be exceedingly low. However, the staff has more 
recently used an additional analysis that would bound an incomplete 
drain down of the SFP water, or some other catastrophic event (such as 
a complete drainage of the SFP with rearrangement of spent fuel rack 
geometry and/or the addition of rubble to the SFP). The analysis 
postulates that decay heat transfer from the spent fuel via conduction, 
convection, or radiation would be impeded. This analysis is often 
referred to as an adiabatic heat-up.
    The licensee's analyses referenced in its exemption request 
demonstrates 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 after October 2014, the 
KPS spent fuel will remain at temperatures far below those associated 
with a significant radiological release. In addition, the licensee's 
adiabatic heat-up analyses demonstrate that as of October 21, 2014, 
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. The licensee states that for this loss of all 
cooling scenario, 10 hours is sufficient time for personnel to respond 
with additional resources, equipment, and capability to restore cooling 
to the SFP, even after a non-credible, catastrophic event. As provided 
in DEK's letter dated January 10, 2014 (ADAMS Accession No. 
ML14016A078), the licensee furnished information concerning its makeup 
strategies, in the event of a loss of SFP coolant inventory. The 
multiple strategies for providing makeup to the SFP include: Using 
existing plant systems for inventory makeup; supplying water through 
hoses to a spool piece connection to the existing SFP piping; or using 
a diesel-driven portable pump to take suction from Lake Michigan and 
provide makeup or spray to the SFP. These strategies will be maintained 
by a license condition. The licensee states that the equipment needed 
to perform these actions are located onsite, and that the external 
makeup strategy (using a diesel driven portable pump) is capable of 
being deployed within 2 hours. The licensee also stated that, 
considering the very low-probability of beyond design-basis accidents 
affecting the SFP, these diverse strategies provide defense-in-depth 
and time to mitigate and prevent a zirconium fire, using makeup or 
spray into the SFP before the onset of zirconium cladding rapid 
oxidation.
    In the safety evaluation of the licensee's request for exemptions 
from certain emergency planning requirements dated October 27, 2014 
(ADAMS Accession No. ML14261A223), the NRC staff assessed the DEK 
accident analyses associated with the radiological risks from a 
zirconium fire at the permanently shutdown and defueled KPS site. The 
NRC staff has confirmed that under conditions where cooling air flow 
can develop, suitably conservative calculations indicate that by the 
end of October 2014, the fuel would remain at temperatures where the 
cladding would be undamaged for an unlimited period. 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 staff 
finds 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 additional zirconium fire risks, as 
discussed in SECY-00-0145 and SECY-01-0100. In addition, the NRC staff 
noted that there is a well-established precedent of granting a similar 
exemption to other permanently shutdown and defueled power reactors, 
upon demonstration that the criterion of the zirconium fire risks from 
the irradiated fuel stored in the SFP is of negligible concern.

A. Authorized by Law

    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 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. Therefore, the exemption is authorized by law.

B. 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.
    SECY-93-127, SECY-00-0145, and SECY-01-0100 provide a basis for 
allowing licensees of decommissioning plants to reduce their primary 
offsite

[[Page 15641]]

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 permanently shutdown 
and defueled reactors are greatly reduced, when compared to operating 
reactors, and the associated potential for offsite financial 
liabilities from an accident are commensurately less. The licensee has 
analyzed and the staff has confirmed that the possible accidents that 
could result in an offsite radiological risk are minimal, thereby 
justifying the proposed reductions in offsite 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 be problematic for DEK because the licensee would incur 
financial liability, if an extraordinary nuclear incident occurred at 
another nuclear power plant. Because KPS is permanently shut down, it 
does not produce revenue from electricity generation sales to cover 
such a liability. Therefore, such liability, if incurred, could 
significantly affect the financial resources available to the facility 
to conduct and complete radiological decontamination and 
decommissioning activities. Furthermore, the shared financial risk 
exposure to DEK is greatly disproportionate to the radiological risk 
posed by KPS, when compared to operating reactors.
    The reduced overall risk to the public at decommissioning power 
plants does not warrant DEK 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 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, the NRC staff concludes that granting the exemption 
from 10 CFR 140.11(a)(4) is in the public interest.

C. Environmental Considerations

    The NRC approval of the exemption to 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 further 
analysis 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.
    The Director, Division of Operating Reactor Licensing, Office of 
Nuclear Reactor Regulation, has determined that approval of the 
exemption request involves no significant hazards consideration because 
reducing a licensee's offsite liability requirements at KPS 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 KPS. 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 mitigation. 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. The requirement for offsite liability 
insurance may be viewed as involving surety, insurance, or indemnity 
matters.
    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 approval of this exemption request.

IV. Conclusions

    Accordingly, the Commission has determined that, pursuant to 10 CFR 
140.8, the exemption is authorized by law, and is otherwise in the 
public interest. Therefore, the Commission hereby grants DEK exemption 
from the requirement of 10 CFR 140.11(a)(4) to permit the licensee to 
reduce primary offsite liability insurance to $100 million, accompanied 
by withdrawal from participation in the secondary insurance pool for 
offsite liability insurance.
    The exemption is effective upon issuance.

    Dated at Rockville, Maryland, this 13th day of March, 2015.

    For the Nuclear Regulatory Commission.
Michele G. Evans,
Director, Division of Operating Reactor Licensing, Office of Nuclear 
Reactor Regulation.
[FR Doc. 2015-06730 Filed 3-23-15; 8:45 am]
BILLING CODE 7590-01-P