United States Nuclear Regulatory Commission

Office of Public Affairs

Washington, DC 20555

Phone 301-415-8200 Fax 301-415-2234

Internet:opa@nrc.gov

No. 96-56 FOR IMMEDIATE RELEASE

(Tuesday, April 9, 1996)

NRC CONSIDERING REVISING DECOMMISSIONING FUNDING RULE

TO REFLECT UTILITY DEREGULATION; PUBLIC COMMENTS ASKED

The Nuclear Regulatory Commission is considering revising

NRC's regulations on decommissioning funding to better reflect

conditions brought about by restructuring and deregulation of the

electric power industry.

Before proceeding with publication of a proposed rule,

however, the Commission is seeking public comments on several

issues involved. The deadline for submission of comments is June

24.

Present NRC regulations, adopted in 1988, permit a nuclear

electric utility to set aside decommissioning funds annually over

the estimated life of a plant. But those same regulations give

electric utilities more flexibility than non-utility licensees in

setting up a financial assurance mechanism.

The reason is that utilities have long operated in a highly

structured, regulated and non-competitive environment with

assured ratepayer revenues to meet prudent costs. However, with

the growing trend toward deregulation of the electric power

industry, questions have arisen as to whether a nuclear power

licensee could lose a regulated rate base as a source of funds to

cover the unfunded balance of decommissioning expenses.

Accordingly, the Commission is considering changing its

decommissioning funding regulations to:

ˇ Require that electric utility reactor licensees assure

NRC that they can finance the full estimated cost of

decommissioning if they are no longer subject to rate

regulation by state agencies or by the Federal Energy

Regulatory Commission and do not have a guaranteed

source of income.

ˇ Require utility licensees to report periodically on the

status of their decommissioning funds. The present

rule has no such requirement because state and Federal

rate-regulating bodies actively monitor these funds. A
deregulated nuclear utility would have no such

monitoring.

Additionally, the NRC is considering permitting licensees to

take credit for a positive, real rate of return on

decommissioning trust funds during a period of safe storage (a

decommissioning phase when the plant is maintained in a condition

that allows the radioactivity on site to decay). Under the

present rule, licensees cannot take credit for earnings on such

funds during safe storage because it is assumed that inflation

and taxes would erode any investment return.

The NRC is also requesting comments on whether the Federal

government licensees of operating power reactors should be

allowed to continue to use statements of intent to meet

decommissioning financial assurance requirements for their power

reactors.

Full details are available in the NRC's Advanced Notice of

Proposed Rulemaking on this matter, published in the April 8

edition of the Federal Register. The notice also may be accessed

on the NRC Electronic Bulletin Board on Fedworld, or may be

obtained from the NRC Office of Public Affairs.

Comments should be mailed to: The Secretary of the

Commission, U.S. Nuclear Regulatory Commission, Washington, DC

20555, Attention: Docketing and Service Branch. They may be

delivered to 11555 Rockville Pike, Rockville, Maryland, between

7:45 a. m. and 4:15 p. m. on Federal workdays. Comments also may

be submitted electronically through the NRC Electronic Bulletin

Board on FedWorld.

NRC's preliminary views expressed in the proposed rulemaking

notice may change in light of comments received. Any proposed

rule developed also will be published for public comment before

adoption in final form.

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