67368 Federal Register / Vol. 83, No. 248 / Friday, December 28, 2018 / Notices 

adversely affect Exelon’s ability to physically 

secure the site or protect special nuclear 

material. Physical security measures at 

Oyster Creek are not affected by the 

requested exemption. Therefore, the 

proposed exemption is consistent with the 

common defense and security. 

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 necessary to achieve the 

underlying purpose of the regulation. 

The underlying purpose of 10 CFR 

50.54(w)(1) is to provide reasonable 

assurance that adequate funds will be 

available to stabilize reactor 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. Oyster Creek 

permanently shut down on September 17, 

2018, and permanently defueled on 

September 25, 2018, it is no longer possible 

for the radiological consequences of 

design-basis accidents or other credible 

events at Oyster Creek to exceed the limits 

of the EPA PAGs at the exclusion area 

boundary. The licensee has evaluated the 

consequences of highly unlikely, beyonddesign-basis conditions involving a loss of 

coolant from the SFP. The analyses show that 

after 12 months (365 days) from cessation of 

power operations on September 17, 2018, 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 Oyster Creek 

site, should such an event occur. Therefore, 

the NRC 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 

Oyster Creek 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 § 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. 

As the Deputy Director, Division of 

Operating Reactor Licensing, Office of 

Nuclear Reactor Regulation, I have 

determined that approval of the exemption 

request involves no significant hazards 

consideration because reducing the licensee’s 

onsite property damage insurance for Oyster 

Creek 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 Oyster Creek. 

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 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 as set forth in 10 

CFR 50.12. 

Therefore, the Commission hereby grants 

Exelon an exemption from the requirements 

of 10 CFR 50.54(w)(1) for Oyster Creek. The 

licensee permanently ceased power operation 

at Oyster Creek on September 17, 2018. The 

exemption will permit Oyster Creek to lower 

the minimum required onsite insurance to 

$50 million no earlier than 12 months (365 

days) after the licensee’s certification of 

permanent cessation of operation under 

§ 50.82(a)(1). 

The exemption is effective 12 months (365 

days) from the certification of permanent 

cessation of operation under § 50.82(a)(1). 

Dated at Rockville, Maryland, this 19th day 

of December 2018. 

For the Nuclear Regulatory Commission. 

/RA/ 

Kathryn M. Brock, 

Deputy Director, Division of Operating 

Reactor Licensing, Office of Nuclear Reactor 

Regulation. 

[FR Doc. 2018–28202 Filed 12–27–18; 8:45 am] 

BILLING CODE 7590–01–P 

NUCLEAR REGULATORY 

COMMISSION 

[Docket No. 50–219; NRC–2018–0288] 

Exelon Generation Company, LLC; 

Oyster Creek Nuclear Generating 

Station 

AGENCY: Nuclear Regulatory 

Commission. 

ACTION: Exemption; issuance. 

SUMMARY: The U.S. Nuclear Regulatory 

Commission (NRC) is issuing 

exemptions in response to a letter dated 

March 29, 2018, as supplemented by a 

letter dated May 8, 2018, exemption 

request from Exelon Generation 

Company, LLC (Exelon or the licensee). 

The exemption permits Exelon to 

reduce the required level of primary 

offsite liability insurance from $450 

million to $100 million and to eliminate 

the requirement to carry secondary 

financial protection for Oyster Creek 

Nuclear Generating Station. 

DATES: The exemption was issued on 

December 19, 2018. 

ADDRESSES: Please refer to Docket ID 

NRC–2018–0288 when contacting the 


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Federal Register / Vol. 83, No. 248 / Friday, December 28, 2018 / Notices 67369 

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–2018–0288. Address 

questions about Docket IDs in 

Regulations.gov to Krupskaya Castellon; 

telephone: 301–287–9221; email: 

Krupskaya.Castellon@nrc.gov. 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 publiclyavailable documents online in the 

ADAMS Public Documents collection at 

http://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, 301– 

415–4737, or by email to pdr.resource@

nrc.gov. 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: John 

G. Lamb, Office of Nuclear Reactor 

Regulation, U.S. Nuclear Regulatory 

Commission, Washington, DC 20555– 

0001; telephone: 301–415–3100; email: 

John.Lamb@nrc.gov. 

SUPPLEMENTARY INFORMATION: The text of 

the exemption is attached. 

Dated at Rockville, Maryland, this 21st day 

of December 2018. 

For the Nuclear Regulatory Commission. 

John G. Lamb, 

Senior Project Manager, Special Projects and 

Process Branch, Division of Operating Reactor 

Licensing, Office of Nuclear Reactor 

Regulation. 

Attachment—Exemption 

NUCLEAR REGULATORY COMMISSION 

Docket No. 50–219 

Exelon Generation Company, LLC 

Oyster Creek Nuclear Generating Station 

Exemption 

I. Background. 

Exelon Generation Company, LLC (Exelon, 

the licensee), is the holder of Renewed 

Facility Operating License No. DPR–16 for 

Oyster Creek Nuclear Generating Station 

(Oyster Creek). By letter dated February 14, 

2018 (Agencywide Documents Access and 

Management System (ADAMS) Accession 

No. ML18045A084), Exelon submitted to the 

U.S. Nuclear Regulatory Commission (NRC) a 

certification in accordance with Sections 

50.82(a)(1)(i) of Title 10 of the Code of 

Federal Regulations (10 CFR), indicating that 

it plans to cease permanent operation no later 

than October 31, 2018. Exelon permanently 

ceased operations at Oyster Creek on 

September 17, 2018. The facility consists of 

a permanently shutdown and defueled 

boiling-water reactor located in the town of 

Forked River, Ocean County, New Jersey. 

II. Request/Action. 

By letter dated March 29, 2018 (ADAMS 

Accession No. ML18088A849), as 

supplemented by letter dated May 8, 2018 

(ADAMS Accession No. ML18128A291), 

Exelon submitted a request for exemption 

from 10 CFR 140.11(a)(4), concerning offsite 

primary and secondary liability insurance. 

The exemption from 10 CFR 140.11(a)(4) 

would permit Exelon to reduce the required 

level of primary offsite liability insurance 

from $450 million to $100 million and to 

eliminate the requirement to carry secondary 

financial protection for Oyster Creek. 

The regulation at 10 CFR 140.11(a)(4) 

requires each licensee to have and maintain 

primary financial protection in an amount of 

$450 million. In addition, the licensee is 

required to participate in an industry 

retrospective rating plan (secondary financial 

protection) that commits each licensee to pay 

into an insurance pool to be used for 

damages that may exceed primary insurance 

coverage. Participation in the industry 

retrospective rating plan will subject Exelon 

to deferred premium charges up to a 

maximum total deferred premium of 

$131,056,000 with respect to any nuclear 

incident at any operating nuclear power 

plant, and up to a maximum annual deferred 

premium of $20,496,000 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 would require 

insurance or indemnification is 

commensurately lower for permanently shut 

down and defueled plants. Therefore, Exelon 

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 industry 

retrospective rating plan. 

III. Discussion. 

Pursuant to 10 CFR 140.8, ‘‘Specific 

exemptions,’’ the Commission may, upon 

application of any interested person or upon 

its own initiative, grant such exemptions 

from the requirements of the regulations in 

10 CFR part 140, when the exemptions are 

authorized by law and are otherwise in the 

public interest. The NRC staff has reviewed 

Exelon’s request for an exemption from 10 

CFR 140.11(a)(4) and has concluded that the 

requested exemption is authorized by law 

and is otherwise in the public interest. 

The Price Anderson Act of 1957 (PAA) 

requires that nuclear power reactor licensees 

have insurance to compensate the public for 

damages arising from a nuclear incident. 

Specifically, the PAA requires licensees of 

facilities with a ‘‘rated capacity of 100,000 

electrical kilowatts or more’’ to maintain the 

maximum amount of primary offsite liability 

insurance commercially available (currently 

$450 million) and a specified amount of 

secondary insurance coverage (currently up 

to $131,056,000 per reactor). In the event of 

an accident causing offsite damages in excess 

of $450 million, each licensee would be 

assessed a prorated share of the excess 

damages, up to $131,056,000 per reactor, for 

a total of approximately $13 billion per 

nuclear incident. The NRC’s regulations at 10 

CFR 140.11(a)(4) implement these PAA 

insurance requirements and set forth the 

amount of primary and secondary insurance 

each power reactor licensee must have. 

As noted above, the PAA requirements 

with respect to primary and secondary 

insurance, and the implementing regulations 

at 10 CFR 140.11(a)(4), apply to licensees of 

facilities with a ‘‘rated capacity of 100,000 

electrical kilowatts or more.’’ When the NRC 

issues a license amendment to a 

decommissioning licensee to reflect the 

defueled status of the facility, the license 

amendment includes removal of the rated 

capacity of the reactor from the license. 

Accordingly, a reactor that is undergoing 

decommissioning has no ‘‘rated capacity.’’ 

Removal of the rated capacity from the 

facility of a decommissioning licensee, thus, 

allows the NRC to take the reactor licensee 

out of the category of reactor licensees that 

are required to maintain the maximum 

available insurance and to participate in the 

secondary retrospective insurance pool under 

the PAA, subject to a technical finding that 

lesser potential hazards exist at the facility 

after termination of operations. 

The financial protection limits of 10 CFR 

140.11(a)(4) were established to require a 

licensee to maintain sufficient insurance, as 

specified under the PAA, to satisfy liability 

claims by members of the public for personal 

injury, property damage, and the legal cost 

associated with lawsuits, as the result of a 

nuclear accident at an operating reactor with 

a rated capacity of 100,000 kilowatts electric 

(or greater). Thus, the insurance levels 

established by this regulation, as required by 

the PAA, were associated with the risks and 

potential consequences of an accident at an 

operating reactor with a rated capacity of 

100,000 kilowatts electric (or greater). 

The legal and associated technical basis for 

granting exemptions from 10 CFR part 140 is 

set forth 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 

legal analysis underlying SECY–93–127 

concluded that, upon a technical finding that 

lesser potential hazards exist after 

termination of operations (and removal of the 

rated capacity), the Commission has the 

discretion under the PAA to reduce the 

amount of insurance required of a licensee 

undergoing decommissioning. 

As a technical matter, the fact that a reactor 

has permanently ceased operations is not 


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itself determinative as to whether a licensee 

may cease providing the offsite liability 

coverage required by the PAA and 10 CFR 

140.11(a)(4). In light of the presence of 

freshly discharged irradiated fuel in the spent 

fuel pool (SFP) at a recently shutdown 

reactor, the primary consideration is the risk 

of offsite radiological release from a 

zirconium fire. That risk generally remains 

for about 10–16 months of decay time for the 

fuel used in the last cycle of power operation. 

After that time, the offsite consequences of an 

offsite radiological release from a zirconium 

fire are negligible for shutdown reactors, but 

the SFP is still operational and an inventory 

of radioactive materials still exists onsite. 

Therefore, an evaluation of the potential for 

offsite damage is necessary to determine the 

appropriate level of offsite insurance post 

shutdown, in accordance with the 

Commission’s discretionary authority under 

the PAA to establish an appropriate level of 

required financial protection for such 

shutdown facilities. 

The NRC staff has conducted an evaluation 

and concluded that, aside from the handling, 

storage, and transportation of spent fuel and 

radioactive materials for a permanently shut 

down and defueled reactor, no reasonably 

conceivable potential accident exists that 

could cause significant offsite damage. 

During normal power reactor operations, the 

forced flow of water through the reactor 

coolant system removes heat generated by the 

reactor. The reactor coolant system transfers 

this heat away from the reactor core by 

converting reactor feedwater to steam, which 

then flows to the main turbine generator to 

produce electricity. Most 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 Oyster Creek and the 

permanent removal of the fuel from the 

reactor core, such accidents are no longer 

possible. The reactor, reactor coolant system, 

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, reactor coolant system, or 

supporting systems are no longer applicable. 

During reactor decommissioning, the 

principal radiological risks are associated 

with the storage of spent fuel onsite. On a 

case-by-case basis, licensees undergoing 

decommissioning have been granted 

permission to reduce the required amount of 

primary offsite liability insurance coverage 

from $450 million to $100 million and to 

withdraw from the secondary insurance pool. 

One of the technical criteria for granting the 

exemption is that the possibility of a designbasis event that could cause significant 

offsite damage has been eliminated. 

The NRC staff performed an evaluation of 

the design-basis accidents for Oyster Creek 

being permanently defueled as part of SECY– 

18–0062, ‘‘Request by the Exelon Generation 

Company, LLC for Exemptions from Certain 

Emergency Planning Requirements for the 

Oyster Creek Nuclear Generating Station,’’ 

dated May 31, 2018 (ADAMS Accession No. 

ML18030B340). 

The licensee has stated, and the NRC staff 

agrees, that while spent fuel remains in the 

SFP, the only postulated design-basis 

accident that would remain applicable to 

Oyster Creek in the permanently defueled 

condition that could contribute a significant 

dose will be a fuel handling accident (FHA) 

in the Reactor Building, where the SFP is 

located. For completeness, the NRC staff also 

evaluated the applicability of other designbasis accidents documented in the Oyster 

Creek Updated Final Safety Analysis Report 

(UFSAR) (ADAMS Accession No. 

ML15307A558), to ensure that these 

accidents would not have consequences that 

could potentially exceed the 10 CFR 50.67 

dose limits and Regulatory Guide 1.183, 

‘‘Alternative Radiological Source Terms for 

Evaluating Design Basis Accidents at Nuclear 

Power Reactors,’’ dose acceptance criteria or 

approach the U.S. Environmental Protection 

Agency (EPA) early phase protective action 

guides (PAGs). 

In the Oyster Creek UFSAR, the licensee 

has determined that within 33 days after 

shutdown, the FHA doses would decrease to 

a level that would not warrant protective 

actions under the EPA early phase PAG 

framework, notwithstanding meeting the 

dose limit requirements under 10 CFR 50.67 

and dose acceptance criteria under 

Regulatory Guide 1.183. 

The NRC staff notes that the doses from an 

FHA are dominated by the isotope Iodine131. The date of cessation of power 

operations of Oyster Creek occurred on 

September 17, 2018. With 12 months of 

decay, the thyroid dose from an FHA would 

be negligible. After 12 months of decay, the 

only isotope remaining in significant 

amounts, among those postulated to be 

released in a design-basis accident FHA, 

would be Krypton-85. Since Krypton-85 

primarily decays by beta emission, the 

calculated skin dose from an FHA analysis 

would make an insignificant contribution to 

the total effective dose equivalent (TEDE), 

which is the parameter of interest in the 

determination of the EPA early phase PAGs 

for sheltering or evacuation. The NRC staff 

concludes that the dose consequence from an 

FHA for the permanently defueled Oyster 

Creek would not approach the EPA early 

phase PAGs. Therefore, any offsite 

consequence from a design-basis radiological 

release is unlikely, and a significant amount 

of offsite liability insurance coverage is not 

required. 

The only beyond design-basis event that 

has the potential to lead to a significant 

radiological release at a permanently shut 

down and defueled (decommissioning) 

reactor is a zirconium fire. The zirconium fire 

scenario is a postulated, but highly unlikely, 

accident scenario that involves the loss of 

water inventory from the SFP, resulting in a 

significant heatup 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 Oyster 

Creek has been permanently shut down. 

In the analysis provided in Attachment 2, 

‘‘Oyster Creek Nuclear Generating Station 

Zirconium Fire Analysis for Drained Spent 

Fuel Pool (Calculation C–1302–226–E310– 

457),’’ to the application, as supplemented by 

letters dated March 8, 2018, and March 19, 

2018 (ADAMS Accession Nos. ML18067A087 

and ML18078A146, respectively), the 

licensee compared the conditions for the 

hottest fuel assembly stored in the SFP to a 

criterion proposed in SECY-99-168, 

‘‘Improving Decommissioning Regulations 

for Nuclear Power Plants,’’ dated June 30, 

1999 (ADAMS Accession No. 

ML12265A598), applicable to offsite 

emergency response for the unit in the 

decommissioning process. This criterion 

considers the time for the hottest assembly to 

heat up from 30 degrees Celsius (°C) to 900 

°C adiabatically. If the heatup time is greater 

than 10 hours, then offsite emergency 

preplanning involving the plant is not 

necessary. Based on the limiting fuel 

assembly for decay heat and adiabatic heatup 

analysis presented in Attachment 2, at 12 

months (365 days) after permanent cessation 

of power operations (i.e., 12 months decay 

time), the time for the hottest fuel assembly 

to reach 900 °C is 10 hours after the 

assemblies have been uncovered. As stated in 

NUREG–1738, ‘‘Technical Study of Spent 

Fuel Pool Accident Risk at Decommissioning 

Nuclear Power Plants,’’ February 2001 

(ADAMS Accession No. ML010430066), 900 

°C is an acceptable temperature to use for 

assessing onset of fission product release 

under transient conditions (to establish the 

critical decay time for determining 

availability of 10 hours for deployment of 

mitigation equipment and, if necessary, for 

offsite agencies to take appropriate action to 

protect the health and safety of the public, if 

fuel and cladding oxidation occurs in air). 

The NRC staff reviewed the calculation to 

verify that important physical properties of 

materials were within acceptable ranges and 

the results were accurate. The NRC staff 

determined that physical properties were 

appropriate. Therefore, the NRC staff found 

that after 12 months (365 days), more than 10 

hours would be available before a significant 

offsite release could begin. The NRC staff 

concluded that the adiabatic heatup 

calculation provided an acceptable method 

for determining the minimum time available 

for deployment of mitigation equipment and, 

if necessary, implementing measures under a 

comprehensive general emergency plan. 

In this regard, one technical criterion for 

relieving decommissioning reactor licensees 

from the insurance obligations applicable to 

an operating reactor is a finding that the heat 

generated by the SFP has decayed to the 

point where the possibility of a zirconium 

fire is highly unlikely. 

This was addressed in SECY–93–127, 

where the NRC staff concluded that there was 

a low likelihood and reduced short-term 

public health consequences of a zirconium 

fire once a decommissioning plant’s spent 

fuel has sufficiently decayed. In its Staff 

Requirements Memorandum, ‘‘Financial 

Protection Required of Licensees of Large 

Nuclear Power Plants during 

Decommissioning,’’ dated July 13, 1993 

(ADAMS Accession No. ML003760936), the 


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Federal Register / Vol. 83, No. 248 / Friday, December 28, 2018 / Notices 67371 

Commission approved a policy that 

authorized, through the exemption process, 

withdrawal from participation in the 

secondary insurance layer and a reduction in 

commercial liability insurance coverage to 

$100 million, when a licensee is able to 

demonstrate that the spent fuel could be aircooled if the SFP was drained of water. 

The NRC 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); Zion Nuclear Power Station, 

published in the Federal Register on 

December 28, 1999 (64 FR 72700); Kewaunee 

Power Station, published in the Federal 

Register on March 24, 2015 (80 FR 15638); 

and Crystal River Unit 3 Nuclear Generation 

Plant, published in the Federal Register on 

May 6, 2015 (80 FR 26100)). 

Additional discussions of other 

decommissioning reactor licensees that have 

received exemptions to reduce their primary 

insurance level to $100 million are provided 

in SECY-96-256, ‘‘Changes to the Financial 

Protection Requirements for Permanently 

Shutdown Nuclear Power Reactors, 10 CFR 

50.54(w) 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. 

The NRC staff has evaluated the issue of 

zirconium fires in SFPs and presented an 

independent evaluation of a SFP subject to a 

severe earthquake in NUREG–2161, 

‘‘Consequence Study of a Beyond-DesignBasis 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, fuel in a 

dispersed high-density configuration would 

be adequately cooled by natural circulation 

air flow within several months after 

discharge from a reactor if the pool was 

drained of water. 

By letters dated August 22 and December 

6, 2017 (ADAMS Accession Nos. 

ML17234A082 and ML17340A708, 

respectively), Exelon confirmed that the 

plant design and fuel storage configuration 

considered in NUREG–2161 were consistent 

with the Oyster Creek plant design and fuel 

storage configurations to be used in the 

decommissioning of Oyster Creek. The NRC 

staff independently confirmed that the Oyster 

Creek fuel assembly decay levels are also 

consistent with the spent fuel considered in 

NUREG–2161. Thus, the NRC staff has 

determined that after 12 months (365 days) 

decay, the fuel stored in the Oyster Creek 

SFP will be able to adequately be cooled by 

air in the unlikely event of pool drainage. 

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 

offsite insurance. Analyzing when the spent 

fuel stored in the SFP is capable of adequate 

air-cooling is one measure that demonstrates 

when the probability of a zirconium fire 

would be exceedingly low. 

The licensee’s analyses referenced in its 

exemption request demonstrate 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 12 months (365 

days) after the certification of permanent 

removal of fuel from the reactor vessel that 

the Oyster Creek spent fuel will remain at 

temperatures far below those associated with 

a significant radiological release. 

In addition, the licensee performed 

adiabatic heatup analyses, in which a 

complete drainage of the SFP is combined 

with rearrangement of spent fuel rack 

geometry and/or the addition of rubble to the 

SFP; this type of analysis postulates that 

decay heat transfer from the spent fuel via 

conduction, convection, or radiation would 

be impeded. The licensee’s adiabatic heatup 

analyses demonstrate that 12 months (365 

days) after the certification of permanent 

removal of the fuel from the reactor vessel, 

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. 

In Exelon’s letter dated March 19, 2018 

(ADAMS Accession No. ML18088A849), the 

licensee furnished the following information: 

‘‘Because of the length of time it would take 

for the adiabatic heatup to occur, there is 

ample time to respond (≥10 hours) to any 

drain down event that might cause such an 

occurrence by restoring cooling or makeup, 

or providing spray. As a result, the likelihood 

that such a scenario would progress to a 

zirconium fire is not deemed credible.’’ 

In the NRC staff’s evaluation contained in 

SECY–18–0062, ‘‘Request by the Exelon 

Generation Company, LLC for Exemptions 

from Certain Emergency Planning 

Requirements for the Oyster Creek Nuclear 

Generating Station,’’ dated May 31, 2018 

(ADAMS Accession No. ML18030B340), the 

NRC staff assessed the Exelon accident 

analyses associated with the radiological 

risks from a zirconium fire at a permanently 

shut down and defueled Oyster Creek site. 

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, the NRC staff found 

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 NRC 

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 

zirconium fire risks, as discussed in SECY– 

00–0145 and SECY–01–0100. The NRC has 

previously determined in SECY–00–0145 

that the minimum offsite financial protection 

requirement may be reduced to $100 million 

and that secondary insurance is not required, 

once it is determined that the spent fuel in 

the SFP is no longer thermal-hydraulically 

capable of sustaining a zirconium fire based 

on a plant-specific analysis. In addition, the 

NRC staff notes that similar exemptions from 

these insurance requirements, have been 

granted to other permanently shutdown and 

defueled power reactors, upon satisfactory 

demonstration that zirconium fire risk from 

the irradiated fuel stored in the SFP is of 

negligible concern. 

A. The Exemption is Authorized by Law 

The PAA, and its implementing regulations 

in 10 CFR 140.11(a)(4), require licensees of 

nuclear reactors that have a rated capacity of 

100,000 kilowatts electric or more to have 

and maintain $450 million in primary 

financial protection and to participate in a 

secondary retrospective insurance pool. 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 legal and associated technical basis 

for granting exemptions from 10 CFR part 

140 are set forth in SECY–93–127. The legal 

analysis underlying SECY–93–127 concluded 

that, upon a technical finding that lesser 

potential hazards exist after termination of 

operations, the Commission has the 

discretion under the Price-Anderson Act to 

reduce the amount of insurance required of 

a licensee undergoing decommissioning. 

Based on its review of Exelon’s exemption 

request, the NRC staff concludes that the 

technical criteria for relieving Exelon from its 

existing primary and secondary insurance 

obligations have been met. As explained 

above, the NRC staff has concluded that no 

reasonably conceivable design-basis accident 

exists that could cause an offsite release 

greater than the EPA PAGs, and therefore, 

that any offsite consequence from a designbasis radiological release is unlikely, and the 

need for a significant amount of offsite 

liability insurance coverage is unwarranted. 

Additionally, the NRC staff determined that, 

after 12 months (365 days) decay, the fuel 

stored in the Oyster Creek SFP will be able 

to adequately be cooled by air in the unlikely 

event of pool drainage. Moreover, in 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, the NRC staff has determined that 

10 hours would be available and 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. Thus, the 

NRC staff concludes that the fuel stored in 


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67372 Federal Register / Vol. 83, No. 248 / Friday, December 28, 2018 / Notices 

the Oyster Creek SFP will have decayed 

sufficiently by the requested effective 

exemption date of 12 months (365 days) after 

the certification that the fuel has been 

permanently removed from the reactor 

vessel, to support a reduction in the required 

insurance consistent with SECY–00–0145. 

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. 

Accordingly, consistent with the legal 

standard presented in SECY–93–127, under 

which decommissioning reactor licensees 

may be relieved of the requirements to carry 

the maximum amount of insurance available 

and to participate in the secondary 

retrospective premium pool where there is 

sufficient technical justification, the NRC 

staff concludes that the requested exemption 

is authorized by law. 

B. The Exemption 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. 

The basis provided in SECY–93–127, 

SECY–00–0145, and SECY–01–0100 allows 

licensees of decommissioning plants to 

reduce their primary offsite 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 the 

risks at operating reactors, and the associated 

potential for offsite financial liabilities from 

an accident are commensurately less. The 

licensee has analyzed and the NRC staff has 

confirmed that the risks of accidents that 

could result in an offsite radiological risk are 

minimal, thereby justifying the proposed 

reductions in offsite primary 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 

potentially have adverse consequences on the 

safe and timely completion of 

decommissioning. If a nuclear incident 

sufficient to trigger the secondary insurance 

layer occurred at another nuclear power 

plant, the licensee could incur financial 

liability of up to $131,056,000. However, 

because Oyster Creek is permanently shut 

down, it cannot produce revenue from 

electricity generation sales to cover such a 

liability. Therefore, such liability if 

subsequently incurred, could significantly 

affect the ability of the facility to conduct and 

complete timely radiological 

decontamination and decommissioning 

activities. In addition, as SECY–93–127 

concluded, the shared financial risk exposure 

to Exelon is greatly disproportionate to the 

radiological risk posed by Oyster Creek, 

when compared to operating reactors. The 

reduced overall risk to the public at 

decommissioning power plants does not 

warrant that Exelon be required 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 as 

discussed in SECY–00–0145, 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, an exemption from 

participation in the secondary insurance pool 

and a reduction in the primary insurance to 

$100 million, a value more in line with the 

potential consequences of accidents, would 

be in the public interest in that this assures 

there will be adequate funds to address any 

of those consequences and helps to assure 

the safe and timely decommissioning of the 

reactor. 

Therefore, the NRC staff has concluded 

that an exemption from 10 CFR 140.11(a)(4), 

which would permit Exelon to lower the 

Oyster Creek primary insurance levels and to 

withdraw from the secondary retrospective 

premium pool at the requested effective date 

of 12 months (365 days) after the certification 

of permanent fuel removal from the reactor 

vessel, is in the public interest. 

C. Environmental Considerations 

The NRC’s approval of an exemption from 

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 the 

requirement to prepare an environmental 

assessment or environmental impact 

statement, 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. 

As the Deputy Director, Division of 

Operating Reactor Licensing, Office of 

Nuclear Reactor Regulation, I have 

determined that approval of the exemption 

request involves no significant hazards 

consideration, as defined in 10 CFR 50.92, 

because reducing a licensee’s offsite liability 

requirements at Oyster Creek 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 Oyster Creek or 

site activities. 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 any activities conducted at the 

site. 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 resulting from issuance of the 

requested exemption. The requirement for 

offsite liability insurance involves surety, 

insurance, or indemnity matters only. 

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 Exelon an 

exemption from the requirements of 10 CFR 

140.11(a)(4) for Oyster Creek. The licensee 

permanently ceased operation at Oyster 

Creek on September 17, 2018. The exemption 

from 10 CFR 140.11(a)(4) permits Oyster 

Creek to reduce the required level of primary 

financial protection, from $450 million to 

$100 million and to withdraw from 

participation in the secondary layer of 

financial protection 12 months (365 days) 

after the certification of permanent fuel 

removal from the reactor vessel. 

The exemption is effective 12 months (365 

days) after the certification of permanent fuel 

removal from the reactor vessel under 

§ 50.82(a)(1). 

Dated at Rockville, Maryland, this 19th day 

of December 2018. 

For the Nuclear Regulatory Commission. 

Kathryn M. Brock, 

Deputy Director, Division of Operating 

Reactor Licensing, Office of Nuclear Reactor 

Regulation. 

[FR Doc. 2018–28203 Filed 12–27–18; 8:45 am] 

BILLING CODE 7590–01–P 


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