81 FR 24136 - Entergy Nuclear Operations, Inc.; Vermont Yankee Nuclear Power Station

NUCLEAR REGULATORY COMMISSION

Federal Register Volume 81, Issue 79 (April 25, 2016)

The U.S. Nuclear Regulatory Commission (NRC) is issuing an exemption from the requirement to maintain a specified level of onsite property damage insurance in response to a request from Entergy Nuclear Operations, Inc. (ENO or the licensee) dated April 17, 2014. The exemption would permit Vermont Yankee Nuclear Power Station (VY) to reduce its onsite insurance from $1.06 billion to $50 million.

[Federal Register Volume 81, Number 79 (Monday, April 25, 2016)]
[Notices]
[Pages 24136-24139]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-09558]


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NUCLEAR REGULATORY COMMISSION

[Docket No. 50-271; NRC-2016-0017]


Entergy Nuclear Operations, Inc.; Vermont Yankee Nuclear 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 the requirement to maintain a specified level of onsite 
property damage insurance in response to a request from Entergy Nuclear 
Operations, Inc. (ENO or the licensee) dated April 17, 2014. The 
exemption would permit Vermont Yankee Nuclear Power Station (VY) to 
reduce its onsite insurance from $1.06 billion to $50 million.

DATES: April 25, 2016.

ADDRESSES: Please refer to Docket ID NRC-2016-0017 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-2016-0017. 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 is available 
in ADAMS) is provided the first time that it is mentioned in this 
document.
     NRC's PDR: You may examine and purchase copies of public 
documents at the NRC's PDR, Room O1-F21, One White Flint North, 11555 
Rockville Pike, Rockville, Maryland 20852.

FOR FURTHER INFORMATION CONTACT: Jack D. Parrott, Office of Nuclear 
Material Safety and Safeguards, U.S. Nuclear Regulatory Commission, 
Washington, DC 20555-0001; telephone: 301-415-6634, email: 
[email protected].

SUPPLEMENTARY INFORMATION: 

I. Background

    The VY site is a single unit facility located near the town of 
Vernon, Vermont. The site is situated in Windham County on the western 
shore of the Connecticut River, immediately upstream of the Vernon 
Hydroelectric Station. The VY facility employs a General Electric 
boiling water reactor nuclear steam supply system licensed to generate 
1,912 megawatts thermal. The boiling water reactor and supporting 
facilities are owned and operated by Entergy Vermont Yankee, a 
subsidiary of ENO. The licensee, ENO, is the holder of Renewed Facility 
Operating License No. DPR-28. The license provides, among other things, 
that the facility is subject to all rules, regulations, and orders of 
the NRC now or hereafter in effect.
    By letter dated September 23, 2013 (ADAMS Accession No. 
ML13273A204), ENO submitted a notification to the NRC indicating that 
it would permanently shut down VY in the fourth calendar quarter of 
2014. On December 29, 2014, ENO permanently ceased power operations at 
VY. On January 12, 2015, ENO certified that it had permanently defueled 
the VY reactor vessel and placed the fuel in the spent fuel pool (SFP) 
(ADAMS Accession No. ML15013A426). Accordingly, pursuant to Sec.  
50.82(a)(2) of title 10 of the Code of Federal Regulations (10 CFR), 
the VY renewed facility operating license no longer authorized 
operation of the reactor or emplacement or retention of fuel in the 
reactor vessel. However, the licensee is still authorized to possess 
and store irradiated nuclear fuel. Irradiated fuel is currently being 
stored onsite in a SFP and independent spent fuel storage installation 
dry casks.

II. Request/Action

    Under 10 CFR 50.12, ``Specific exemptions,'' ENO has requested an 
exemption from 10 CFR 50.54(w)(1) by letter dated April 17, 2014 (ADAMS 
Accession No. ML14111A401). The exemption from the requirements of 10 
CFR 50.54(w)(1) would permit ENO to reduce its onsite property damage 
insurance from $1.06 billion to $50 million.
    The regulation in 10 CFR 50.54(w)(1) requires each licensee to have 
and maintain onsite property damage insurance to stabilize and 
decontaminate the reactor and reactor site in the event of an accident. 
The onsite insurance coverage must be either $1.06 billion or whatever 
amount of insurance is generally available from private sources 
(whichever is less).
    The licensee states that the risk of an accident at a permanently 
shutdown and defueled reactor is much less than the risk from an 
operating power reactor. In addition, since reactor operation is no 
longer authorized at VY, there are no events that would require the 
stabilization of reactor conditions after an accident. Similarly, the 
risk of an accident that would result in significant onsite 
contamination at VY is also much lower than the risk of such an event 
at operating reactors. Therefore, ENO is requesting an exemption from 
10 CFR 50.54(w)(1), effective April 15, 2016, that would permit a 
reduction in its onsite property damage insurance from $1.06 billion to

[[Page 24137]]

$50 million, commensurate with the reduced risk of an accident at the 
permanently shutdown and defueled VY reactor.

III. Discussion

    In accordance with 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 when (1) the 
exemptions are authorized by law, will not present an undue risk to the 
public health or safety, and are consistent with the common defense and 
security; and (2) any of the special circumstances listed in 10 CFR 
50.12(a)(2) are present.
    The financial protection limits of 10 CFR 50.54(w)(1) were 
established after the Three Mile Island accident, out of concern that 
licensees may be unable to financially cover onsite cleanup costs, in 
the event of a major nuclear accident. The specified $1.06 billion 
coverage amount requirement was developed based on an analysis of an 
accident at a nuclear reactor operating at power, resulting in a large 
fission product release and requiring significant resource expenditures 
to stabilize the reactor conditions and ultimately decontaminate and 
cleanup the site (similar to the stabilization and cleanup activities 
at the Fukushima Daiichi nuclear power facility following the damage 
from a severe earthquake and tsunami).
    These cost estimates were developed in consideration of the 
spectrum of postulated accidents for an operating nuclear reactor. The 
costs were derived from the consequences of a release of radioactive 
material from the reactor. Although the risk of an accident at an 
operating reactor is very low, the consequences can be large. In an 
operating plant, the high temperature and pressure of the reactor 
coolant system (RCS), as well as the inventory of relatively short-
lived radionuclides, contribute to both the risk and consequences of an 
accident. With the permanent cessation of reactor operations at VY and 
the permanent removal of the fuel from the reactor core, such accidents 
are no longer possible. As a result, the reactor, RCS, and supporting 
systems no longer operate and, therefore, have no function as it 
pertains to the storage of the irradiated fuel. Hence, 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 April 17, 
2014, exemption request, ENO describes both design-basis and beyond-
design-basis events involving irradiated fuel stored in the SFP. The 
licensee determined that there are no applicable design-basis events at 
VY that could result in a radiological release exceeding the limits 
established by the U.S. Environmental Protection Agency (EPA) early-
phase Protective Action Guidelines (PAGs) of one roentgen equivalent 
man (rem) at the exclusion area boundary, as a way to demonstrate that 
any possible radiological releases would be minimal and not require 
precautionary protective actions (e.g., sheltering in place or 
evacuation). The staff evaluated the radiological consequences 
associated with various decommissioning activities, and design basis 
accidents at VY, in consideration of VY's permanently shut down and 
defueled status. The possible design-basis accident scenarios at VY 
have greatly reduced radiological consequences. Based on its review, 
the staff concluded that no reasonably conceivable design-basis 
accident exists that could cause an offsite release greater than the 
EPA PAGs. The only design-basis accident that could potentially result 
in an offsite radiological release at VY is a fuel handling accident 
(FHA). Analysis performed by the licensee concluded that 17 days after 
shutdown, the radiological consequence of an FHA would not exceed the 
limits established by the EPA PAGs at the exclusion area boundary. 
Based on the time that VY has been permanently shutdown (approximately 
13 months), the staff determined that the possibility of an offsite 
radiological release from a design-basis accident that could exceed the 
EPA PAGs has been eliminated. The only event that has the potential to 
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 
the 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 VY has been permanently shut 
down.
    The NRC staff has previously authorized a lesser amount of onsite 
property damage insurance coverage based on this analysis of the 
zirconium fire risk. 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), the staff recommended changes to the power 
reactor insurance regulations that would allow licensees to lower 
onsite insurance levels to $50 million, upon demonstration that the 
fuel stored in the SFP can be air-cooled. In its Staff Requirements 
Memorandum to SECY-96-256, dated January 28, 1997 (ADAMS Accession No. 
ML15062A454), the Commission supported the staff's recommendation that, 
among other things, would allow permanently shutdown power reactor 
licensees to reduce commercial onsite property damage insurance 
coverage to $50 million, when the licensee was able to demonstrate the 
technical criterion that the spent fuel could be air-cooled if the SFP 
was drained of water. The staff has used this technical criterion to 
grant similar exemptions to other decommissioning reactors (e.g., Maine 
Yankee Atomic Power Station, published in the Federal Register on 
January 19, 1999 (64 FR 2920); and Zion Nuclear Power Station, 
published in the Federal Register on December 28, 1999 (64 FR 72700)). 
These prior exemptions were granted, based on these licensees 
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 Spent Fuel Pools,'' dated June 4, 2001 (ADAMS Accession 
Nos. ML003721626 and ML011450420, respectively), the NRC staff 
discussed additional information concerning SFP zirconium fire risks at 
decommissioning reactors and associated implications for onsite 
property damage insurance. Providing an analysis of when the spent fuel 
stored in the SFP is capable of air-cooling is one measure that can be 
used to demonstrate that the probability of a zirconium fire is 
exceedingly low. However, the staff has more recently used an 
additional analysis that bounds 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). This analysis includes an assumption of 
adiabatic conditions,

[[Page 24138]]

which means no heat transfer from the spent fuel via conduction, 
convection, or radiation.
    In the case of VY, the licensee determined that the fuel removed 
from the reactor would have sufficiently decayed by April 15, 2016, to 
significantly reduce the risk from SFP draining events. To support this 
determination, the licensee provided an adiabatic analysis indicating 
that the fuel cladding temperature would not reach levels associated 
with a significant radiological release within 10 hours after the loss 
of all means of cooling. The licensee maintains strategies and 
equipment to cool the spent fuel in the unlikely event that coolant is 
lost, and the 10-hour adiabatic heating time would provide sufficient 
time for personnel to respond with onsite equipment to restore a means 
of spent fuel cooling.
    In addition, the licensee cited NRC-staff developed reports 
concluding that the high density storage of fuel in the SFP is safe and 
the risk of a large radiological release is very low. The staff 
presented an independent evaluation of a SFP subject to a severe 
earthquake in NUREG-2161, ``Consequence Study of a Beyond-Design-Basis 
Earthquake Affecting the Spent Fuel Pool for a U.S. Mark I Boiling 
Water Reactor,'' September 2014 (ADAMS Accession No. ML14255A365). This 
evaluation concluded that, for a representative boiling-water reactor 
(BWR), fuel in a dispersed high-density configuration would be 
adequately cooled by natural circulation airflow within several months 
after discharge from a reactor if the pool was drained of water.
    By letter dated November 23, 2015 (ADAMS Accession No.ML15329A167), 
ENO confirmed that the plant design and fuel storage configuration 
considered in NUREG-2161 were consistent with the VY plant design and 
fuel storage configurations to be used in the decommissioning of VY. 
The staff independently confirmed that the fuel assembly decay power 
was also consistent. Thus, after 15.4 months decay, which will be 
reached by the requested effective date of April 15, 2016 for this 
exemption, the fuel stored in the VY SFP will be able to adequately be 
cooled by air in the unlikely event the SFP drained. 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 to prevent the zirconium cladding from reaching a 
point of rapid oxidation.
    Based on the above discussion and SECY-96-256, the NRC staff 
determined $50 million to be an adequate level of onsite property 
damage insurance for a decommissioning reactor, once the spent fuel in 
the SFP is no longer susceptible to a zirconium fire. The staff has 
postulated that there is still a potential for other radiological 
incidents at a decommissioning reactor that could result in significant 
onsite contamination besides a zirconium fire. In SECY-96-256, the NRC 
staff cited the rupture of a large contaminated liquid storage tank, 
causing soil contamination and potential groundwater contamination, as 
the most costly postulated event to decontaminate and remediate (other 
than a SFP zirconium fire). The postulated large liquid radiological 
waste storage tank rupture event was determined to have a bounding 
onsite cleanup cost of approximately $50 million. Therefore, the staff 
determined that the licensee's proposal to reduce onsite insurance to a 
level of $50 million would be consistent with the bounding cleanup and 
decontamination cost, as discussed in SECY-96-256, to account for the 
postulated rupture of a large liquid radiological waste tank at the VY 
site, should such an event occur.

A. Authorized by Law

    The regulation in 10 CFR 50.54(w)(1) requires each licensee to have 
and maintain onsite property damage insurance of either $1.06 billion 
or whatever amount of insurance is generally available from private 
sources, whichever is less. In accordance with 10 CFR 50.12, the 
Commission may grant exemptions from the regulations in 10 CFR part 50, 
as the Commission determines are authorized by law.
    As explained above, the NRC staff has determined that the 
licensee's proposed reduction in onsite property damage insurance 
coverage to a level of $50 million is consistent with SECY-96-256. 
Moreover, the staff concluded that as of April 15, 2016, sufficient 
irradiated fuel decay time will have elapsed at VY to decrease the 
probability of an onsite and offsite radiological release from a 
postulated zirconium fire accident to negligible levels. In addition, 
the licensee's proposal to reduce onsite insurance to a level of $50 
million is consistent with the maximum estimated cleanup costs for the 
recovery from the rupture of a large liquid radiological waste storage 
tank.
    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, or other laws, as amended. Therefore, based on its review 
of ENO's exemption request, as discussed above, and consistent with 
SECY-96-256, the NRC staff concludes that the exemption is authorized 
by law.

B. No Undue Risk to Public Health and Safety

    The onsite property damage insurance requirements of 10 CFR 
50.54(w)(1) were established to provide financial assurance that 
following a significant nuclear incident, onsite conditions could be 
stabilized and the site decontaminated. The requirements of 10 CFR 
50.54(w)(1) and the existing level of onsite insurance coverage for VY 
are predicated on the assumption that the reactor is operating. 
However, VY is a permanently shutdown and defueled facility. The 
permanently defueled status of the facility has resulted in a 
significant reduction in the number and severity of potential 
accidents, and correspondingly, a significant reduction in the 
potential for and severity of onsite property damage. The proposed 
reduction in the amount of onsite insurance coverage does not impact 
the probability or consequences of potential accidents. The proposed 
level of insurance coverage is commensurate with the reduced 
consequences of potential nuclear accidents at VY. Therefore, the NRC 
staff concludes that granting the requested exemption will not present 
an undue risk to the health and safety of the public.

C. Consistent With the Common Defense and Security

    The proposed exemption would not eliminate any requirements 
associated with physical protection of the site and would not adversely 
affect ENO's ability to physically secure the site or protect special 
nuclear material. Physical security measures at VY are not affected by 
the requested exemption. Therefore, the proposed exemption is 
consistent with the common defense and security.

D. Special Circumstances

    Under 10 CFR 50.12(a)(2)(ii), special circumstances are present if 
the 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. The underlying purpose of 
10 CFR 50.54(w)(1) is to provide reasonable

[[Page 24139]]

assurance that adequate funds will be available to stabilize conditions 
and cover onsite cleanup costs associated with site decontamination, 
following an accident that results in the release of a significant 
amount of radiological material. Because VY is permanently shut down 
and defueled, it is no longer possible for the radiological 
consequences of design-basis accidents or other credible events at VY 
to exceed the limits of the EPA PAGs at the exclusion area boundary. 
The licensee has evaluated the consequences of highly unlikely, beyond-
design-basis conditions involving a loss of coolant from the SFP. The 
analyses show that after April 15, 2016, the likelihood of such an 
event leading to a large radiological release is negligible. The NRC 
staff's evaluation of the licensee's analyses confirm this conclusion.
    The NRC staff also finds that the licensee's proposed $50 million 
level of onsite insurance is consistent with the bounding cleanup and 
decontamination cost, as discussed in SECY-96-256, to account for the 
hypothetical rupture of a large liquid radiological waste tank at the 
VY site, should such an event occur. Therefore, the staff concludes 
that the application of the current requirements in 10 CFR 50.54(w)(1) 
to maintain $1.06 billion in onsite insurance coverage is not necessary 
to achieve the underlying purpose of the rule for the permanently 
shutdown and defueled VY reactor.
    Under 10 CFR 50.12(a)(2)(iii), special circumstances 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 NRC staff concludes that if the licensee was required to 
continue to maintain an onsite insurance level of $1.06 billion, the 
associated insurance premiums would be in excess of those necessary and 
commensurate with the radiological contamination risks posed by the 
site. In addition, such insurance levels would be significantly in 
excess of other decommissioning reactor facilities that have been 
granted similar exemptions by the NRC.
    The NRC staff finds that compliance with the existing rule would 
result in an undue hardship or other costs that are significantly in 
excess of those contemplated when the regulation was adopted and are 
significantly in excess of those incurred by others similarly situated.
    Therefore, the special circumstances required by 10 CFR 
50.12(a)(2)(ii) and 10 CFR 50.12(a)(2)(iii) exist.

E. 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 under Sec.  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 Decommissioning, Uranium Recovery and 
Waste Programs, Office of Nuclear Material Safety and Safeguards, has 
determined that approval of the exemption request involves no 
significant hazards consideration because reducing the licensee's 
onsite property damage insurance for VY does not (1) involve a 
significant increase in the probability or consequences of an accident 
previously evaluated; or (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 VY. 
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.
    In addition, 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. Moreover, the 
requirement for onsite property damage insurance involves surety, 
insurance, and indemnity matters. Accordingly, the exemption request 
meets the eligibility criteria for categorical exclusion set forth in 
10 CFR 51.22(c)(25). 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 
50.12(a), the exemption from 50.54(w)(1) 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. In addition, special 
circumstances are present as set forth in 10 CFR 50.12. Therefore, the 
Commission hereby grants VY an exemption from the requirements of 10 
CFR 50.54(w)(1). The exemption will permit VY to lower minimum required 
onsite insurance to $50 million no earlier than April 15, 2016.
    The exemption is effective upon issuance.

    Dated at Rockville, Maryland, this 15th day of April, 2016.

    For the Nuclear Regulatory Commission.
John R. Tappert,
 Director, Division of Decommissioning, Uranium Recovery and Waste 
Programs, Office of Nuclear Material Safety and Safeguards.
[FR Doc. 2016-09558 Filed 4-22-16; 8:45 am]
 BILLING CODE 7590-01-P