[Federal Register Volume 80, Number 70 (Monday, April 13, 2015)]
[Notices]
[Pages 19697-19701]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-08395]


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NUCLEAR REGULATORY COMMISSION

[Docket No. 50-305; NRC-2015-0089]


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 the requirement to maintain a specified level of onsite 
property damage insurance 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 onsite property 
damage insurance from $1.06 billion to $50 million.

DATES: April 13, 2015.

[[Page 19698]]


ADDRESSES: Please refer to Docket ID NRC-2015-0089 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:
    <bullet> Federal Rulemaking Web site: Go to http://www.regulations.gov and search for Docket ID NRC-2015-0089. Address 
questions about NRC dockets to Carol Gallagher; telephone: 301-415-
3463; email: <a href="/cdn-cgi/l/email-protection#46052734292a6801272a2a27212e23340628342568212930"><span class="__cf_email__" data-cfemail="bffcdecdd0d391f8ded3d3ded8d7dacdffd1cddc91d8d0c9">[email protected]</span></a>. For technical questions, contact 
the individual listed in the FOR FURTHER INFORMATION CONTACT section of 
this document.
    <bullet> 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 <a href="/cdn-cgi/l/email-protection#136377613d6176607c66617076537d61703d747c65"><span class="__cf_email__" data-cfemail="b3c3d7c19dc1d6c0dcc6c1d0d6f3ddc1d09dd4dcc5">[email protected]</span></a>. The 
ADAMS accession number for each document referenced in this document 
(if that document is available in ADAMS) is provided the first time 
that a document is referenced.
    <bullet> 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: <a href="/cdn-cgi/l/email-protection#7027191c1c19111d5e380516161d111e301e02135e171f06"><span class="__cf_email__" data-cfemail="7f28161313161e1251370a1919121e113f110d1c51181009">[email protected]</span></a>.

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, which is 27 miles southeast of Green Bay, 
Wisconsin. The licensee, DEK, is the holder of KPS Renewed Facility 
Operating License No. DPR-43. 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 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 under Section 50.82(a)(2) of Title 10 of the 
Code of Federal Regulations (10 CFR), DEK is no longer authorized to 
operate the KPS 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

    Under 10 CFR 50.12, ``Specific exemptions,'' DEK has requested an 
exemption from 10 CFR 50.54(w)(1) by a letter dated March 20, 2014 
(ADAMS Accession No. ML14090A111). The exemption from the requirements 
of 10 CFR 50.54(w)(1) would permit DEK 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 KPS, there are no events that would require the 
stabilization of reactor conditions after an accident. Similarly, the 
risk of an accident that that would result in significant onsite 
contamination at KPS is also much lower than the risk of such an event 
at operating reactors. Therefore, DEK is requesting an exemption from 
10 CFR 50.54(w)(1) to reduce its onsite property damage insurance from 
$1.06 billion to $50 million, commensurate with the reduced risk of an 
accident at the permanently shutdown and defueled KPS site.

III. Discussion

    Under 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 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 based on the spectrum of 
postulated accidents for an operating nuclear reactor. Those 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 KPS 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 related 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 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 a radiological release exceeding the limits 
established by the U.S. Environmental Protection Agency's (EPA's) 
early-phase Protective Action Guidelines (PAGs) of 1 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

[[Page 19699]]

zirconium fire. The zirconium fire scenario is a postulated, but highly 
unlikely, beyond-design-basis accident scenario that involves loss of 
all 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 hypothetical beyond-
design-basis accidents that could result in a 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 radiological 
release. This is important, because the NRC staff has previously 
authorized a lesser amount of onsite property damage insurance coverage 
based on 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 spent fuel pool 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 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 the 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). 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 
heatup.
    The licensee's analyses, as referenced in its March 20, 2014, 
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 has also provided an adiabatic heatup analysis, 
demonstrating that as of October 21, 2014, there will 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 should all means to cool the spent fuel be 
lost, 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 letters dated August 23, 2013 (ADAMS Accession No. ML13242A019), 
and January 10, 2014 (ADAMS Accession No. ML14016A078), DEK 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. DEK 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. DEK 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 
to 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 
staff has confirmed that under conditions where cooling airflow can 
develop, suitably conservative calculations indicate that by the end of 
October 2014, the fuel will remain at temperatures where the cladding 
will 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 to prevent the zirconium cladding from reaching a 
point of rapid oxidation.
    The staff's basis as to why it considers $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, is provided in SECY-96-256. The staff 
has postulated that there is still a potential

[[Page 19700]]

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 radwaste storage tank rupture event was 
determined to have a bounding onsite cleanup cost of approximately $50 
million.
    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. In addition, the staff notes that there 
is a precedent of granting a similar exemption to other permanently 
shutdown and defueled power reactors. As previously stated, the staff 
concluded that as of October 30, 2014, sufficient irradiated fuel decay 
time has elapsed at KPS to decrease the probability of an onsite 
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 radwaste storage tank.

A. Authorized by Law

    Under 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. 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, 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 KPS 
are predicated on the assumption that the reactor is operating. 
However, KPS 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 risk and 
reduced cost consequences of potential nuclear accidents at KPS. 
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 DEK's ability to physically secure the site or protect special 
nuclear material. Physical security measures at KPS 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 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 KPS is permanently shut down and 
defueled, it is no longer possible for the radiological consequences of 
design-basis accidents or other credible events at KPS to exceed the 
limits of the EPA PAGs at the exclusion area boundary. The licensee has 
performed site-specific analyses of highly unlikely, beyond-design-
basis zirconium fire accidents involving the stored irradiated fuel in 
the SFP. The analyses show that after October 30, 2014, the 
probabilities of such an accident are minimal. 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 
hypothetical rupture of a large liquid radwaste tank at the KPS site, 
should such an event occur. The staff notes that KPS's technical 
specifications provide controls for unprotected outdoor liquid storage 
tanks to limit the quantity of radioactivity contained in these tanks, 
in the event of an uncontrolled release of the contents of these tanks. 
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 KPS 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

[[Page 19701]]

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 the licensee's onsite property damage insurance for KPS 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 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 onsite property damage 
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 
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. 
Therefore, the Commission hereby grants DEK an exemption from the 
requirements of 10 CFR 50.54(w)(1), to permit the licensee to reduce 
its onsite property damage insurance to a level of $50 million.
    The exemption is effective upon issuance.

    Dated at Rockville, Maryland, this 3rd day of April, 2015.

    For the Nuclear Regulatory Commission.
Michele G. Evans,
Director, Division of Operating Reactor Licensing, Office of Nuclear 
Reactor Regulation.
[FR Doc. 2015-08395 Filed 4-10-15; 8:45 am]
 BILLING CODE 7590-01-P


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