NL-07-0678, Financial Assurance Requirements for Decommissioning Nuclear Power Reactors
| ML070820401 | |
| Person / Time | |
|---|---|
| Site: | Farley  |
| Issue date: | 03/23/2007 |
| From: | George B Southern Nuclear Operating Co |
| To: | Document Control Desk, NRC/NRR/ADRO |
| References | |
| NL-07-0678 | |
| Download: ML070820401 (10) | |
Text
Southern Nuclear Operating Company, Inc.
Post Office Box 1295 Birmingham, Alabama 35201-1295 March 23, 2007 Docket Nos.:
50-348 50-364 Energy to Serve Your WorldSM U. S. Nuclear Regulatory Commission A m : Document Control Desk Washington, D. C. 20555-000 1 Joseph M. Farley Nuclear Plant Financial Assurance Requirements for Decommissioning Nuclear Power Reactors (10 CFR 50.75(0(1))
Ladies and Gentlemen:
Pursuant to 10 CFR 50.75(0(1), each power reactor licensee is required to report to the NRC the status of its decommissioning funding for each reactor or part of each reactor it owns on a calendar year basis, beginning on March 31,1999, and every two years thereafter. Southern Nuclear Operating Company (Southern Nuclear) holds operating licenses NPF-2 and NPF-8 for the Joseph M. Farley Nuclear Plant owned by Alabama Power Company. Accordingly, Southern Nuclear provides the enclosed Alabama Power Company submittal in accordance with the requirements of 1 0 CFR 50.75(f)(l).
Should you have any questions concerning this matter, please contact me at 205.992.7870.
Sincerely,,
B. J. ~ e o k e I
Manager, Nuclear Licensing
U. S. Nuclear Regulatory Commission NL-07-0678 Page 2
Enclosure:
Alabama Power Company Letter dated March 5,2007 cc:
Southern Nuclear ODerating; Com~any Mr. J. T. Gasser, Executive Vice President Mr. D. H. Jones, Vice President - Engineering Ms. K. S. King, Chief Financial Officer, VP Corporate Services RTYPE: CFA04.054; LC# 14560 U. S. Nuclear Realatow Commission Dr. W. D. Travers, Regional Administrator Ms. K. R. Cotton, NRR Project Manager - Farley Mr. E. L. Crowe, Senior Resident Inspector - Farley Alabama Power Company Mr. A. P. Beattie, Executive Vice President, Chief Financial Officer and Treasurer Mr. J. R. DeRieux, Assistant Treasurer and Manager - TreasuryRinance
Enclosure Joseph M. Farley Nuclear Plant Financial Assurance Requirements for Decommissioning Nuclear Power Reactors (1 0 CFR 50.75(0(1))
Alabama Power Company Letter dated March 5,2007
J. Randy DeRieux 600 North 18th Street Assistant Treasurer and Post Office Box 2641 Manager -
Birmingham, Alabama 35291-0040 TreasuryIFinance Tel 205.257.2454 Fax 205.257.1023 March 5,2007 ALABAMA POWER Docket Nos.: 50-348 50-364 Always on:'
A SOUTHERN COMPANY I
100 Years. Lighting the way.
U. S. Nuclear Regulatory Commission ATTN: Document Control Desk Washington, D.C. 20555 Joseph M. Farley Nuclear Plant Financial Assurance Requirements for Decommissioning Nuclear Power Reactors (10 CFR 50.75(fX1))
Dear Ladies and Gentlemen:
Pursuant to 10 CFR 50.75(f)(l), each power reactor licensee is required to report to the NRC the status of its decommissioning funding for each reactor or part of each reactor it owns on a calendar year basis, beginning on March 3 1, 1999, and every two years thereafter. Alabama Power Company (APC) hereby submits the enclosed information in accordance with 10 CFR 50.75(f)(1) for operating licenses NPF-2 and NPF-8 issued for Joseph M. Farley Nuclear Plant Unit 1 and 2, respectively. Southern Nuclear Operating Company, as the operating licensee and as an agent for the owner of Farley Nuclear Plant, is providing this information to the NRC on behalf of APC.
Based on the information presented herein, there is reasonable assurance that the funding necessary for decommissioning the Farley Nuclear Plant, consistent with the NRC prescribed minimum set forth in 10 CFR 50.75(c), will be available on the expiration date of the operating licenses NPF-2 and NPF-8.
Please advise if you have any questions or comments regarding the information provided herein.
Respectfully submitted, ALABAMA POWER COMPANY, by, J. Randy DeRieux Enclosure cc: Southern Nuclear Operating; Company
U. S. Nuclear Regulatory Commission Page 2 Mr. J. T. Gasser, Executive Vice President U. S. Nuclear Regulatorv Commission Dr. W. D. Travers, Regional Administrator Ms. K. R. Cotton, NRR Project Manager - Farley Mr. C. A. Patterson, Senior Resident Inspector - Farley
Enclosure Alabama Power Company Ownership Percentage - 100%
7.0%
2.5%
NIA NOTES:
' The NRC formulas in section 10 CFR 50.75(c) include only those decommissioning costs incurred by licensees to remove a facility or site safely from service and reduce residual radioactivity to levels that permit: (1) release of the property for unrestricted use and termination of the license; or (2) release of the property under restricted conditions and termination of the license. The cost of dismantling or demolishing non-radiological systems and structures is not included in the NRC decommissioning cost estimates. The costs of managing and storing spent fuel on-site until transfer to DOE are not included in the cost formulas.
Unit 2
$324,660,000
$251,471,176 See Schedule in 4.5%
NIA modifications 2 This number is based on NUREG-1307, Rev. 11, for the burial factor (Option 2) and the December 2005 values for labor and energy factors.
Unit 1
$324,660,000
$262,049,575 See Schedule in 4.5%
NIA No 1
2 3
4 5
6 10 CFR 50.75(f)(1) Requirement The NRC minimum decommissioning estimate, pursuant to 10 CFR 50.75(b) and (c). '
The amount accumulated at the end of the calendar year preceding the date of the report for items included in 10 CFR 50.75(b) and (c).
A schedule of the annual amounts remaining to be collected; for items in 10 CFR 50.75(b) and (c).
The assumptions used regarding:
(a) rates of escalation in decommissioning costs; (b) rates of earnings on decommissioning funds; (c) real rate of return; and (d) rates of other factors used in funding projections.
Any contracts upon which the licensee is relying pursuant to 10 CFR 50.75(e)(l)(v).
Any modifications to a licensee's current method External Sinking Fund "Cost of Service" Rate Making See Attachment 3 7
of providing financial assurance occurring since the last submitted report.
Any material changes to trust agreements.
Schedule of the Annual Amounts Remaining to be Collected Year 2005 2006 2007 2008 2009 201 0 201 1 201 2 201 3 2014 201 5 2016 2017 2018 2019 2020 202 1 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 Beginning Fund Balance Alabama Power Company Farley Nuclear Plant Unit 1 Fund Earnings Fund Contributions Ending Fund Balance Minimum Decommissioning Fund Estimate 324,660,000 339,269,700 354,536,837 370,490,994 387,163,089 404,585,428 422,791,772 441,817,402 461,699,185 482,475,648 504,187,052 526,875,470 550,584,866 575,361,185 601,252,438 628,308,798 656,582,694 686,128,915 71 7,004,716 749,269,929 782,987,075 818,221,494 855,041,461 893,518,327 933,726,651 975,744,351 1,019,652,846 1,065,537,225 1,I 13,486,400 1,I 63,593,288 1,215,954,986 1,270,672,960 1,327,853,243
Year Schedule of the Annual Amounts Remaining to be Collected Alabama Power Company Farley Nuclear Plant Unit 2 Beginning Fund Balance Fund Earnings Fund Contributions Ending Fund Balance Minimum Decommissionirlg Fund Estimate Material Changes to Trust Agreement June 199 1 February 1994 February 1994 February 1994 December 1995 November 1996 March 1999 July 1999 July 1999 August 1999 July 2000 Executed Nonqualified Master Nuclear Decommissioning Trust Agreement with First Alabama Bank, Mobile Executed Investment Management Agreement with W.H. Reaves &
Co. for the Nonqualified Master Nuclear Decommissioning Trust Executed investment Management Agreement with ANB Investment Management and Trust Company for the Nonqualified Master Nuclear Decommissioning Trust Executed Investment Management Agreements with Loomis, Sayles &
Company for the Nonqualified Master Nuclear Decommissioning Trust and the Qualified Master Nuclear Decommissioning Trust Executed Investment Management Agreement with Flaherty &
Crumrine, Inc. for the Nonqualified Master IVuclear Decommission Trust Named Mellon Bank, N.A. successor trustee for the Nonqualified Master Nuclear Decommissioning Trust and the Qualified Master Nuclear Decommissioning Trust Established Trust Owned Life Insurance with Allmerica Financial Life and Annuity Company indirectly through Vinings Management for the Nonqualified Master Nuclear Decommissioning Trust Executed Investment Management Agreement with Northern Trust Company for the Qualified Master Nuclear Decommissioning Trust Executed Investment Management Agreement with Rhumbline Advisers for the Qualified Master Nuclear Decommissioning Trust Executed Investment Management Agreement with Barrow, Hanley, Mewhinney & Strauss, Inc. for the Qualified Master Nuclear Decommissioning Trust Executed Investment Management Agreement with Castleark Management L.L.C. for the Qualified Master Nuclear Decommissioning Trust
September 2002 Executed Investment Management Agreement with AmSouth Bank for the Qualified and Nonqualified Master Nuclear Decommissioning Trust March 2003 Executed Trust Owned Life Insurance with Prudential for the Nonqualified Master Nuclear Decommissioning Trust replacing Allrnerica October 2004 Executed Investment Management Agreement with Flaherty and Crumrine, Inc. for the Qualified Master Nuclear Decommissioning Trust January 2005 Suspended external semi-annual contributions to the Qualified Master Nuclear Decommissioning Trust and the Nonqualified Master Nuclear Decommissioning Trust as directed by the Alabama Public Service Commission May 2005 The NRC granted the Company a 20-year extension of the operating license for both units at Plant Farley February 2006 Executed Investment Management Agreement with AllianceBernstein for the Qualified Master Nuclear Decommissioning Trust replacing Northern Trust