POLICY ISSUE ,.

,.
POLICY ISSUE
March 11, 1987
SECY -87-6 6
(NEGATIVE CONSENT)
For:
The Commissioners
From:
Victor Stell o, Jr.
Executive Direc tor for Operations
Subject:
PARTIAL EXEMPTIONS FROM 10 CFR PART 171, ANNUAL FEE
FOR POWER REACTOR OPERATING LICENSES
To inform the Commission of my proposed parti al exemptions
from the annual fee for the Yankee (Rowe) Nuclear Power
Statio n, the Big Rock Point Plant , and the La Crosse
Boiling Water Reactor.
Purpose:
Discussion:
On September 18, 1986, the Commission adopt~ a final or
new rule, 10 CFR Part 171, Annual Fee for Power React e
Operating Licenses (51 FR 33224). The rule, which l becam
effec tive October 20, 1986, provides that an annua fee or
shall be paid by the licens ed owner for each power react
holding an operating licen se. The rule implements the
Consolidated Omnibus Budget Reco ncilia tion Act of 1985ct
(P.L. 99-272), which requi res the Commission to colle
annual charges not to exceed 33 percent of its FY 1987
budgeted costs . As published in the final rule, the fee a
was to be $950 thousand per react or. This was based ont of
ved budge
FY 87 budget of $405 millio n. With the appro
licen se.
per
and
thous
$940
now
is
$401 milli on, the fee
Proposed
As discussed in the Resolution of Comments on the promu
lgate
to
ission
Comm
the
of
t
Rule, it was not the inten
fees
ing
impos
of
t
effec
the
have
a fee schedule that would
at such a level that the owners of the handful of small ,
older react ors would find it in their best economic also
inter est to shut their react ors down. Thus, the rule
contained a provision (171.11) for exemption from" the
annual fee, which state s:
liThe Corrmission may, upon appli catio n, grant an exemption,
in part, from the annual fee required pursuant to thised by
part. An exemption under this provision may be grant
Contact:
C. J. Holloway, LFMB
49-27225
,."._11''-
_
The Commissioners
2
the Commission taking into consideration the following
factors:
a.
b.
c.
d.
e.
Age of the reactor;
Size of the reactor;
Number of customers in rate base;
Net increase in KWh cost for each customer
directly related to the annual fee assessed
under this part; and
Any other relevant matter which the licensee believes
justifies the reduction of the annual fee."
This paper addresses those applications for exemptions
that have been received from licensees for the three small,
older reactors; these are provided in Enclosures 1 through
3. As the first step in the process, each application was
evaluated using the criteria of Part 171.11 to determine
whether a reduction was appropriate. The factors considered for each plant are summarized at Enclosure 4.
'"
For these plants, the staff notes that the annual fee, on
top of other fees already required by Part 170, provides a
significant increase in power production costs. Because of
the smaller generating capacity, the impact on individual
customers is greater than for the same fee applied to large
plants, and the ability to absorb such costs by the utility
is similarly limited. The staff concludes that these three
plants meet the criteria of Section 171.11; that imposition
of the full annual fee would be a disproportionate burden
for these plants; and, therefore, that a reduction should
be granted for Big Rock Point, La Crosse and for Yankee.
As the second step in the process, the staff tried various
approaches to determine an equitable method of adjusting
the affected plant fees. Those approaches are summarized
at Enclosure 5. The approaches considered included a fee
based on: (1) thermal megawatt power rating (We note that
this form of adjustment is considered ~ when a plant is
determined to meet the criteria establTSned by Section
171.11. All remaining plants which do not qualify for an
exempti on"COntinue to be subject to the annual fee assessed
by the rule.); (2) relative impact of the fee on
requestors; (3) comparison of mill rate increases; and (4)
licensed operating life. The results using these
approaches were relatively close in dollar amounts.
Nevertheless, the amounts were averaged resulting in the
following adjusted fees:
,------,---------
_ _II'
• • •e
•••• •
3
The Commissioners
$ 56,000
La Crosse Boiling Water Reactor
81,000
Big Rock Point
,000
183
Yankee
That the Commission:
Recommendation:
gra nt pa rti al exemptions
Note tha t it is my int ent ion to
uirements for La Crosse,
from the Par t 171 annual feeas req
lec ted in the above cit ed
Big Rock Point and Yankee, rkingrefdays of the date of thi s
adjusted fees within 10 wotru cte d by the Conmtss ton ,
paper unless otherwise ins
/y~,_v;~/
£-~d);,-
Vlctor Ste lla , ~.
Executive Di rec tor
for Operations
Enclosures:
Le tte r dated October 21 ,19 86mic
1.
from A. R. Soucy (Yankee Atolla (NRC)
Ele ctr ic Company) to V. Ste 6 from
Le tte r dated October 28, 198er Cooperative)
2.
J. W. Taylor (Dairyland Pow
to Di rec tor , NRR
6 from
Le tte r dated November 7, 198
3.
Company)
er
Pow
rs
me
nsu
(Co
K. W. Berry
s
to Executive Dir ect or for Operation
(3)
4. Summary Sheets Pro
posed Adjusted
of
Computation
5.
Annual Fee
SECY NOTE:
cti on s to the co ntr ary ,
,
In the ab sen ce of ins tru
ff on Th urs da y, Ma rch 26
SECY wi ll no tif y the sta by ne ga tiv e co ns en t,
198 7 th at the Co mm iss ion po sed in th is pa pe r.
as se nts to the ac tio n pro
DIS TR IBU TIO N:
Co mm iss ion ers
OGC (H St ree t)
01
OCA
OIA
OPA
REGION I
REGION III
EDO
OGC (MNBB)
ACRS
ASLBP
ASLAP
SECY
_ _1_ _• •_
•••
ENCLOSURE 1
A. R. Soucy (Yankee Atomic
Ltr dated October 21, 1986V. from
Ste llo (NRC)
Ele ctr ic Company) to
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Enclosure 1
70 '
M o" O Ch u, "" ' 01
986
o c to b e r 2 1 , 1
FYR 86-102
ll o , J r.
t; o n s
Mr. V ic to r Sirte
to r fo r O p e ram io vi on
c
e
D
e
v
ti
u
c
Exe
la to ry C om
u .s . N u c len a, r DR. eCg.u 20 55 5
W as h in g to
to m ic
o:
s o f Y an ke e oAm th e
D ea r Mr. S te ll
ie
p
o
c
r
u
fo
d
fr
an o ri g in a l en fo r p a rt ia l ex em p ti o n ow
er R e a c to r
E n cl o se d is 's
fl
P
o
ti
r
a
c
fo
li
p
ee
p
F
a
al
u
y
p an
S ee A n n
eg . 33 22 4
E le c tr ic C o m
an n u al fe e . n 0 m en cS m en t, 51 F ed . Rfo
1
17
rt
a
P
r a p a rt ia l
.
st
rl ll l
e
fo
u
q
on
10 C .F .R
C
re
d
's
an
ee
k
s
Y an
m en ti o n
e n se
O p e ra ti n g L1ic8 , 1 9 8 6 ). The b a se s fo r se d a p p li c a ti o n . As wee S ta ff
c lo
th
(S ep te m b er
rt h in th e e n b e p le a se d to m ee t w~th rm a ti o n
fo
t
e
s
re
a
n
w o u ld
al in fo
ex em p ti o
a ti o n , Y an k ee. A ls o , if an y ad cS it io nse
c
li
p
p
a
e
fe e l fr e e
th
in
ti o n
p le a
a
c
n
li
o
p
ti
p
a
a
c
li
e
p
th
p
a
h th e
re g a rd in g
c o n n e c ti o n w it
in
ed
d
ee
n
is
r
a p p li c a ti o n fo
's
to c a ll me.
ee
k
an
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f
ed
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it io n a l co p y le a se h av e th a t co p y m ar n g er .
d
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o
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ll
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e ll . p
u r m es se
e n c lo se d a s wm is si on ancS re tu rn e d to o
is
n
o
ti
p
em
ex
d by th e C om
u rs ,
datecS re c e iv e
v e ry tr u ly y o
C I 7 . A .. ·~ A. R. S o u cy
T re a su re r
•
~RS/kg
E n c lo su re s
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J"S
1.1•
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UN!TED STATES OF
NUCLEAR REGULATORY
k~ERICA
COP~!SSION
)
In The M at te r of
TRIC COMPANY
YANKEE ATOMIC ELEC
(Y an ke e Pl an t)
)
)
)
)
)
D oc ke t No. 50 -2 9 3
Li ce ns e No. DPR-
- -FO-R-PA)RTIAL EXEP.PTION
- - - - - - - -AP-PL-ICATION
ic E le c1. 11 , Yankee A to m
17
n
io
ct
Se
R
CF
Pu rs ua nt to 10
pt ic ~
fo r a pa rt ia l exe~
s
ie
pl
ap
by
re
he
)
ke e"
s
tr lc Company (" Y an
Cornmissj.~n·s ru le
e
th
of
15
1.
17
en ts of Se ct io n
fr om th e re qu ir em
an a re gu la ti on s.
at em en t
Su u~ or ti nc St
lke e su bm its th e fo
an
Y
n,
io
at
ic
pl
ap
In su pp or t of th is
lo w in g:
in
or at io n or ga ni ze d
rp
co
ts
et
us
ch
sa
as
1. Y an ke e is a M
ne d in 10 CFR Se cfi
de
as
y"
it
il
ut
le ct ri c
19 54 an d is an "e
-3 ,
C Li ce ns e No. O PR
NR
of
er
ld
ho
e
th
ke e i5
ti on 2. 4( 5) . Y an
60 .
da te d Ju ly 19 , 19
ac c~ ~e = by
1. 15 w er e re ce nt ly
17
d
an
::
1.
17
2. Se ct io ns
ns e
po se s an an nu al li ce
im
15
1.
17
n
io
ct
Se
d
th e Co m m is si on , an
19 87 is
s, w hi ch fo r fi sc al
ee
ns
ce
li
r
to
ac
re
su rc ha rg e on po w er
rr "i ss io n' s
di ti on to th e Co m
ad
in
is
e
rg
ha
rc
su
$9 50 ,0 00 . Th is
See A nn ua l Fe e fo r
d.
te
la
re
e
us
e
ar
es , w hi ch
Pa rt 17 0 li ce ns e fe
_ _I'
__
_
51
nf or m in g Amendment,
Co
d
an
es
ns
ce
Li
g
ra tin
Power R ea ct or O pe
R ul e) .l
r 18 , 19 86 ) (F in al
be
m
te
ep
(S
24
,2
33
Fe d. Re g.
an nu al fe e. The
at
th
om
fr
ns
io
pt
id es fo r ex em
Se ct io n 17 1. 11 pr ov
s:
n st at es as fo llo w
ex em pt io n pr ov is io
may be
de r th is pr ov is io n in to co ns id An ex em pt io n unCo
mission ta ki ng
gr an te d by th e wmin g fa ct or s:
er at io n th e fo llo
ac to r:
(a ) Age of th e rere
ac to r:
(b ) Si ze of th e st om er s in ra te ba se :
(c ) Number of cu in KWh co st fo r ea ch cu st om er
(d ) N et in cr ea sela te d to th e an nu al fe e as di re ct ly re
pa rt : an d
se ss ed un de r th isnt m at te r w hi ch th e li va
(e ) Any ot he r re lees ju st if ie s th e re cu ct io n
ce ns ee be li ev
of th e an nu al fe e.
th e pa ra gr ap hs th at
in
d
se
es
dr
ad
e
ar
Th es e cr it er ia
fo ll ow .
w at er
t M~e pr es su ri ze d
ne
5
17
a
is
t
an
pl
3. The Yankee
ke e is th e
ber 10 , 19 60 . Y an
m
ve
No
on
g
in
at
er
op
re ac to r th at be ga n
ni te d
w er pl an t in th e U
po
r
ea
cl
nu
al
ci
er
m
m
ol de st op er at in g co
11 ye ar s, an d it s
in
s
re
pi
ex
e
ns
ce
li
Y an ke e' s op e= at in ;
2
S~ at es .
ar s.
ye
5
ly
on
in
re
pi
ra ct s ex
cu rr en t po w er co nt
le i::r.p~5in;
t~ e fi na l- ru
of
ev
i
ev
r
al
ci
=r .is exe=~~ic~
e is se ek in g ju ci
ke
an
is si =~
Y
b=
su
d
an
e,
11 th e P ar t 171 li ce ns e fe
an y of Y an ke e' s ve
ai
w
~o
ed
nd
te
no~ in
ap pl ic a~ io n is
e ru le .
th
to
ob je ct io ns
xt ,
rr ed to in th e teEn
fe
re
s
ct
ra
nt
gl an d
co
er
w
w
Pu rs ua nt to th e lpoof it s en er gy p:od~ction to 10nsNe
~I
in
on
ti
uc
Y an ke e_ se lls al of w hi ch sD on so re c Y an ke e' s co detrrs. Th os e
u ti li ti es , ea ch ar e to da y Y an ke e' s so le share~ol ic ha se d fr om
th e 19 50 's an d li ti es , in tu rn , re se ll en er gy pu
sp on so ri ng u ti d on N ex t Pa ge
ue
(F oo tn ot e 2 C on tin
c=
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3
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r,
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4 . A si d e from
e r p la n ts In
cv
p
r
e
Je
c
nu
}
ffi.i,ercia
E' sIT/QUest cO
th
f
o
e
n
o
s
i
Yankee
te s.
l in th e U n it ed S ta
e n se fe e s w il
c
li
in
0
0
,0
0
5
e of $9
5 . A su rc h a rg
tt h o u r
il l p er k il o w a
m
1
y
rl
a
e
n
o st s by
s po w er c
as te d is p o sa l,
w
c re a se ~ankee'
f
o
st
o
c
re
e e n ti
m p ar ab le to th
co
e
g
ar
ch
(a
is s~=charge
th
(KWH)
t
a
th
te
o
n
le a se
e d by DOE). P
ss
e
ss
a
y
tl
an
n
se
a s p re
fe e s o f m or e th
se
n
e
c
li
0
17
rt
u r c u rr e n t P a
is on to p o f o
e a r.
a so n a b le fo r
$ 2 0 0 ,0 0 0 p e r y
re
n
u
is
e
d
u
it
o f th is m ag n
6 . An in c re a se
c o st s w il l be
er
w
po
ee
nk
~a
ac t on
" ic a l
c to r. The im p
a
re
ll
a
p
sm
ty
a
a
r
fo
su ch
be
~ill
it
s
a
t
a
re
si x ti m es a s g
a p p ro x im a te ly
v in ta g e p la n t.
in
t
n
e
rr
u
c
,
e
wer c o n tr a c ts
la rg
po
e
ke
an
Y
e
th
n to re ne w
7 . The d e c is io
l p la n t li k e
al
sm
a
r
fo
ch
s, w hi
ed on econo~ic
as
b
be
l
c o st s a re
il
w
19 91
rocuction
~
e
ke
.
an
Y
t
C u rr en
e st ~arginal.
b
ro t
a
re
a
e
ke
Y an
E n g la n d h av e p
ew
N
in
ts
n
la
w h er ea s many p
nts/K~~,
ce
4
y
rl
a
ne
e ~a s
P ag e)
fr om P re v io u sa~c re ta :1 r- a rk e ts . Ya~ke
ed
u
n
ti
n
o
C
2
(F o o tn o te to th e ir own ~holesa:e
Y an ke e
m er s.
e is
no o :h e r cu st o
te d th a t Y ankekee was
o
n
be
o
ls
a
ld
u ti li ty . Y an
c ti o n , it sh o u
In th is c o n neec to a s a "s in g le a ss e t"c o n st ru c ti n g an d
o ft e n re fe rrth e ex c1 u si v e p u rp o se o f a r p la n t. U n li k e o th e r
fo rm ed fo r ew E n g :a n c 's fi rs t n u c le an y fu tu re g e n e ra ti n g
t
la n t is
o p e ra ti n g N
n o t c o n st ru cO
l
il
w
e
th e Yankee p
ke
e
an
nc
Y
,
.
s
e
w il l
e
is
ti
li
rw
u ti
a r o r o th e o m m is si o n ed , ~ankee A to m ic
le
c
u
n
,
s
ie
it
il
fa c
se rv ic e an d oliec
ty company.
re m ov ed fr ome ra
ti
u
a
s
a
te
c e a se to o p
- 3 -
- -.._-----------
_ _ lIPS
r
•
••
,0 00
An in cr ea se of $9 50
s.
nt
ce
e
re
th
an
ss th
du ct io n co st s of le
th is ga p
~~ :: wi de ~
li k~ ia nk ~e
t
an
pl
l
al
sm
a
in li ce ns e fe es on
n pr ov iio n 171.~1 ex em pt io
ct
Se
e
th
of
nt
te
e in
st il l fu rt he r. Th
sm al l,
on th e op er at or s of
s
ct
pa
im
e
rs
ve
ad
ch
3
si on is to av oi d su
l. 2.
co
,
27
,2
33
at
g.
e 51 Fe d. Re
ol de r re ac to rs . Se
ea se d
al l re ac to r to in cr
sm
a
of
y
it
iv
it
ns
8. The se
r u ti li ty
ys is of 19 85 nu cl ea
al
an
nt
ce
re
a
in
ex pe ns es is cl ea r
). The st ud y
(A tt ac hm e~ t A
s
st
co
)
&M
en an ce (O
op er at in g an d m ai nt
an d ti gh t
fa c~ c: (8 0\ ),
ty
ci
pa
ca
t
en
ll
an ex ce
shows th at de sp it e
t in
os e to th e hi gh es
cl
e
ar
s
st
co
~
O&
an ke e' s
bu dg et co nt ro ls , Y
th e in cu st ry .
e 0:
Fl ;r th er m or e, be ca us
an m os t
po te nt ia l ha za rd th
9.
le ss
0:
a
-. ;-c :
o~ he r
w
si ze , Ya:1Kee po se s
an ts
co ~~ er ci al p:
si ze ). M or eo~ or ti on a2 to
pr
is
t
uc
od
io n pr
(i nv en to ry of fi ss
ce s ~he
e ar ea , w~ich re du
ot
m
re
ry
ve
a
in
d
ca ~e
ov er , Y an ke e is lo
ic st il l fu rt he r.
ha za rd to th e pu bl
1/
te
of cu st om er s in ra
r
be
um
nl
"[
to
rs
re fe
cu st o~ er
Se ct io n 17 1. 11 al so
h co st fo r ea ch de
'KW
in
se
ea
cr
th is pa rt ."
in
et
ba se " an d "I nl c ~o th e a~n~a: :e e as se ss ee un r it s en er cv
di re ot ly rela~e ta il cus~omers: as no te c, al l 0: 5 ~hat o~n
ie
Y an ke e ~as no reld to th e 10 New En cl an c ctili~st
em s. And,
so
sy
ti ve
ec
sp
re
r
pr od uc ~i on is
ei
th
r
fo
pp ly
rt 17 1
Y an ke e as en er gyovsu
tif fi at es th at th eki Pa
es
e
ke
an
Y
at t ho ur by
e,
w
lo
ab
pe r
st
co
s
as in di ca te d
e'
ke
an
Y
se
th an th e
cr ea
6 tim es greate~ ag
t
ou
li ce ns e fe e w il l min
ab
is
ch
hi
w
nt e
il l,
ap pr ox im at el y 1 il l be ex pe ri en ce d by m or e ~ecent vi
in cr ea se th at w
pl an ts .
- 4 -
..._,-----------------------
als o ju sti fie d
The req ue ste d exe mp tio n is
ne ric co sts un de rly ing the
ge
the
of
~y
~a
t
t~a
~
fac
in vie w cf the
Yankee At om ic. Se e ge nto
t
an
ev
rel
t
no
are
fee
al
Pa rt 171 an nu
Th is
(19 86) (Pr op ose d Ru le) .
9
,07
24
8,
,07
24
g.
Re
d.
er all y, 51 Fe
th the fo ll ow in ~
inc lud es co sts ass oc iat ed wi
ure pla nt de sig ns (id . e
NRC res ear ch dir ec ted toexfut
ine d pre vio us ly, Ya nke
at 24 ,07 9, co l. 3) (as ty pla
and wi ll no t co ns tru ct
is a sin gle -as se t ut ili cle
ar or oth erw ise , in the
any ge ne rat ing pla nt, nu
fu tur e);
ard ve rif ied the rm al hy - nt
NRC res ear ch dir ec ted tow
. at co l. 2), de ve lop me
dr au lic com pu ter co ces (id
me nt (PRA) tec hn olo gy
of pr ob ab ili sti c ris k ass ess
(id . at
sci e~c es res ea rch
(id . at co~. 3) and ea rth
hi s
e
nke
Ya
e its inc ep tio n,
2~ 08 0, co l. 1) (si nc
e,
us
ho
insu bs tan tia l
ind ep en de ntl y de ve lo? ed ic
p2 an t
al ca pa bil iti es for
yt
sta te- o: -th e- ar t ana~
c the rm al
ove
?pr
C-a
ing NR
lud
inc
n,
sig
oe
and
g
to
rin
ee
en gin
rm an ce mo del s and me tho ds
rfo
pe
el
fu
s,
de
co
c
uli
dra
hy
k -- exa mp les of rep or ts
as se ss sei sm olo gic al rispa
bil iti es are YAEC 12 3',
wh ich de scr ibe the se ca
Y~~ C 13 31 ); ind ee d,
YAEC 12 7'P , YAEC 130 0 and
At o~ ic En erc v Ac t
Ya nke e was lic en sed as ancto
r de mo nst rat ion pr oj ec t
se cti on lO ,(b ) pow er rea res ea rch and de ve lop me nt
fo r, among oth er thi ng s,locy. Se e 1 A. E.C . 26
of power reac~or ~echno •
-- (19 57 );
,
ula tio n dir ec ted to lar gens
~~ c res ea rch and reg
sig
de
e
tur
anc ed fu
con tem po rar y pla nts and adv24 ,08 0 at co l. 3) , ~ ,
and
2
.
(id . 2~,079 at c~l
ns tru cti on qu ali ty
pla nt sit ing c~it£ria, co
l rep ort s rel ate d to
ass ura nc e anc venc~r to? ica
sta nd ard de sig ns ;
lic en se s to op era te
Re vie w of ap pli ca tio ns for
at 24 ,08 0, co l. 3) ;
nu cle ar power rea cto rs (id .
en for cem en t me asu res
Sp ec ial ize d ins pe cti on and
ankee Ato mi c ha s an
(id . at 24 ,08 1, co l. 1) (Y
hig h pe rfo rm an ce an d
ex ce lle nt ov era ll rec ord of
co ns ist en tly hig h SALP
re lia bi lit y and rec eiv es B)
.
rat ing s, !! ! At tac hm ent
10 .
--=-----
- 5 -
•••
"7
.'.If
ra ti o n
ll , o ld e r g e n e
a
sm
f
o
s
tu
a
re n t st
,
1 1 . The d if fe
n te x ts a s w e ll
o
c
ry
to
la
u
g
th e r re
co 9 ;. iz ec in o
re
en
be
as
h
k fi tt in g ru le s
c
p la n ts
a
b
d
an
e
c
n
y in su ra
' s p ro p e rt
a tt
o~~ission
C
e
th
b ec au se k il o w
~,
t,
u
p
ly
p
im
S
.1 0 9 ).
of
O.S4(w) an d 5 0
S
§§
.
.R
.F
C
ts is an o re e r
(1 0
n
la
p
n
o
ti
ra
e
n
er ge
fo r sm a ll , o ld
n
o
nt
ti
c
u
d
ro
p
r
hou
ts , th e d if fe re
n
la
p
t
n
e
c
re
f more
new
er th an th a t o
w
lo
e
d
u
it
n
ag
m
in c lu d in g th e
s,
se
en
p
ex
s
u
o
f v a ri
re la ti o n sh ip o
t
fi
e
n
e
-b
st
o
c
be re co g n iz ed .
t
us
m
s,
e
fe
P a rt 17 1
su rc h a rg e o f
a
t
a
th
s
it
m
b
re , Yankee su
1 2 . T h e re fo
(a p p ro x im at el y
s
e
fe
se
n
e
c
n t li
p o f o u r c u rr e
n t,
S950,OOO on to
al l Y an ke e p la
sm
e
th
r
fo
le
o n ab
y e a r) is u n re as
" ty ,
S200,OOO p er
e x c e ll e n t s a fe
an
as
h
d
an
a
a re
te c :n a rura~
t th e
w h ic h is lo c a
e re q u e st s th a
ke
an
Y
.
rd
o
c
re
d enfo~cement
a t th is
re g u la to ry an
~e fe e l th
.
O
O
,O
50
S
it n o t ex ce ed
i~ po se d en
e
fe
~
17
e b e n e fi t to
th
P a rt
e
iz
n
g
co
re
u at e to
more th an ad eq
e
be
ld
u
o
sh
t
n
er ed th ro u g h th
am o u
v
co
re
be
to
o st s th a t a re
va~ious c
e
th
f
o
e
ke
Y an
on
p ti o n a p p li c a ti
em
ex
e
th
g
n
ti
n , re p e a
e
1 3 . In a d d it io
ns um in g fo r th
co
e
m
ti
d
an
c o st ly
r.
y ea r w ou ld be
a rt ia l e x e = ;t ic
p ro c e ss ea ch
o~ , th e p
as
re
t
a
r th
a s Y an ke e. F o
th a t su p p o rt
ts
S ta ff as w e ll
c
fa
he
T
t.
m an en
ld be made p er
u
o
sh
e
er
h
d
e
ou ld u n d er m in e
w
re q u e st
t
a
th
y
~a
y
e in an
w il l n o t ch an g
n
o
ti
a
c
li
p
p
a
th is
n.
o f th e exe~ptio
th e v a li d it y
Pa=~
27 1 fe e s.
- 6 -
--, --- =-----------_._-_.-.
Fina lly, Yankee would welcome the oppo rtuni ty to
icati on; if
meet at the Staf f's conv enien ce to discu ss this appl
the appl icaaddi tiona l infor mati on is neede d in conn ectio n with
14.
tion , pleas e cont act the unde rsign ed.
Conc lusio n
Based upon the foreg oing, Yankee resp ectfu lly requ ests
the rethat it be gran ted a perm anent , part ial exem ption from
posi tion
quire ment s of 10 CFR Secti on 171.1 5. It is Yank ee's
se fees
that the surch arge levie d on top of our Part 170 licen
shou ld not excee d $50,0 00.
Resp ectfu lly subm itted ,
YANK~E ATO~~C
" COY~ANY
ELEC~R!C
BYC·I?~
c:s
A. R. Soucy
T:ea su:e: a:l::
Ch:e : Fina ncial Offi ce:
1671 W=rc ester Read
Fram ingha m, Mass achu setts 01701
Telep hone :
Date d:
October~,
1986
- 7 -
617-8 72-81 00
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MAINTENANCE COSTS 1985
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1.\.245 mill",'KWII. 11'e thur cOI1C~llC)nclccl'0 I rlse In CAl1:1city f;lctnl from
rdio Ihe
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ryde;
lonl~r.r
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in
hrncnt~
2" -momh fuel cycle. "We have fOllnd eli!iti"cl
plnnlJon IR or even 12·
0111 Utll"r.C lIme i!> 1101 !iif~IIlfinntly longer
mont" cycles," 'he !iI'01cC!iI11:tll ~,lcI.
lIi"h ",m"'/KWIII,ro4h,ctloll cost. for I91'S were Iltrr.rly dne 'n o"t:tr.c~,
n!i was Ihe case In 19M. Nc·hra..kn i'lhllc rower UI~tricl'~ (NI'I'D) n1O)I('r,
wilh CO~I'" of "4 A fi? millvK W' lIn 1985,~hrdulcd "n Otll:tRC f'nm Srl'lcmhcr 14'R·' to I\ur.u<;l 1',"5 to ,r"lnee t'IC r«lrculnllon IliIIC"'. DtlrinR I!'C
cml:lr,e, "n IIlI of v:tlvc frllllCldnft nnd lurblne gcnerntor nll1inlen:tl1ce" wn,
c1onc, A..Iilily ~pfl1cc<;mnn !illitl, n,hlinR Ihl1l an Im",ch..dtllccltmhineIltlt.,r.C
n(cmICd in Novemhcr 19R5 lUI nhoul one month. Of'U NuclrJ1r eml"'~
Oysler Crcrk, with cost. uf 311.573 mllh/KWllln 19R.. nnd 32.3"R
milh/KWIl in 19115, DCco"'I,Ii~hccl. rn"'cw rdlllhl!ihmcni from rchfllM)'
191U 10 October 19K", wit" 1911S". regulnropcrnllng yenr,"I GI'U
!>f1Okc!imltn !laid.
I\~ I'''hllc Service Co. of Colorado's roo SI. Vnlln, no eleclricltywM
roenerAtcd eluling mll!>lof I',M nncl1985 btt.llu!ic of refudinK, rnRinerri,,!
lUodificalions, nndrnvironllwn'l1l quolification nell"ity. '1lIUslhc "l/dcnr
pl:'t", had cnSI<; in 19M of~S1r,.2·19 millVKWII. and "50 lillie ~enernliCJn In
19R5 Ih'" no mce "Ruredll n"t," I utllily5110kesmnn slticl. Fotl 51. Vrain
Ihcrr.fclfC rl1nked hir,hc"'llll I'JR~ ItRlductinn ro~'~ on Iltrr KWII Rcnclaloo
i~.
'l:I.. l'hil:ule1Itltla Electric(·o.'s re.,ch 001l0m·2 and -1 were t'own from
",:an
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r:'..ctr/c ".nt.
"".rlors , - " ...v..r
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-Did: MORgrtlf, WtJJ1Jingron: Cl,orlt.f Thurjto". Ntl4' rork
September 191M 10 eMlyJuly 19R5 for replacement of recirculation pipinr.
20.574
n "Iilily !'polcc!'m:m said. In 1984,thc units' production CO~l" were
WJI.
millslK
39.4"9
ItlRS,
rnill!>lKWII; in
Flori,t, rower COf1l.'!\ Cry!'..,1 River·) incurred 19R4 costs of IQ.J I ~
mills/KWJI compared with 1985COSlS or 30.93R miU",IKWIl. A utility
!\IKlkc"'ll1an "",id the nuclear plant's 1984"positive performance" includrll
Ihe r.rncr:'llion of mmO!it1-million MWn, Ihe second hil:he~1 J:cncralion pf
deelricily of nflY nuclc:tr p'anl in Ihc U.S. BUI in 19R5, the plant "·a..out of
service for 21 weeks for rcfuclinR and 250majol NRC-manlbled cbi~n
mOflifkllliun.~, Ihe ~polte!'man s.,id.
Iowa Ekctric Lighl &. "ower Co.'s Duane Amold had an outJ~c du,il1~
19R5 Ihat l:t!ilt'd h:alf Ihe yc.,r.a utility ~polte!>man !i3id. I te ~,id ". 101 of
conlrnclur hell'" ndded 10 co"'I~, such a<; cAtta pipcfillCr!i ancl ekctrici:m~ f"r
a Hl-yr:tt r(l"il,menl in!iptclion. l1te ulilily's 19R4 cost.. wrre 21.321
millv'J{WII compared with 1985cosUof 39.449 millVKW11.
161h in 19R5 :1t
Rocl1C~ler G:t.~ cl Electric Co.'s (RGclE) Ginna, ranlced
WH, CUI co~t~
millsIK
15.910
of
costs
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!laid. the
:tJ1
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1984,•
bc8c:msc of orclntional finc luning. During
r rehc:tter
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e
rnoi"lur
the
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alion
uiiliiy wilijilcl t,1 a itdc~i&n modific
I'<:r·
beller
10
lrihulcd
hichcon
trains,w
cr
Rntl dcaned lhe scxondary foedwal
with
ed
comJ13r
81.16%
was
factor
formnncc. Gin",,'s nel 19R5 cap.,cily
78.7% in 19M,II1C ~po1cesman said, adding lh31 a reduclion in trip out.'r.e
lime dnring 1985also :tdM.d to lhe planl's pcrform:1I1ce.
lor
-
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OUTAGES CONTINUE TO DE DIGGEST COST FACTOR (cnn,;"p ftl!rnm,
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ATTACHMENT B
FRO~ SYSTEMATIC ASSESSMENT OF LICENSEE
PERFOR~A~CE (SALF) REPORT NO. 50-29/85-99
EXCERPT
B.
Facility Performance
Last Period
This Period
(t-\ay 1- 1982)
(September 1, 1983
August 31, 1983 January 31, 1985)
Functional Area
Re-cent Trend
A.
Plant Operations
1
1
Eonsistent
B.
Radiological Controls
Z
Z
Consistent
C.
Maintenance
1
1
Consistent
D.
Surve i llanee
1
1
Consi s t ert
E.
Fire Prote::tion and
Housek.eeping
1
1
Censi ster,,,-
F.
E~e~gen::y
1
1
G.
Security
Z
2
~r.:?!"ovir.g
H.
RefiJeiir.;
1
1
Ccnsis~e!':~
I.
Des~gn Ccr.trcl/Quality
Ass:.:!"ance
Z
Z
Improvin;
Licensing Activities
1
1
Consistent
J.
Preparedness
a~c
Sa hi:;! l"'ds
" Consister.t
9A de:1ir.ing tren: has been noted in the are! of personnel Idherer.:e to Fire
Protection procedures.
ENCLOSURE 2
Ltr dated October 28, 1986 from J. W. Taylor
(Dairyland Power Cooperative) to Director, NRR
Enclosure 2
•
mDAIRYLAND
L.j-f[[J[!!JI:;Iif COOPERATIVE.
PO BOX 817 • 2615 EAST AVE
so
• LA CROSSE. WISCONSIN 54602-0817
(608) 788-4000
JAMES W. TAYLOR
General Manager
Oc~ber
28, 1986
Dir-ector', Nuclear Reac~r Regulation
U. S. Nuclear Regula~ry Commission
Washington, D.C. 20555
RE:
Dairyland Power Cooperative
La Crosse Boiling Water Reactor' (LACBWR)
Provisional Operating License Number DPR-45
Application for Exemption from Annual
Fees Imposed Under 10 CFR Part 171
Dear Sir:
Pursuant to 10 CFR Part 171.11, Dairyland Power Cooperative (DPC), hereby
respectfully request.s that. t.he Nuclear Regulatory Commission (the "Commission")
exempt the La Crosse Boiling Water Reac~r (LACBWR), owned and operated
by DPC, from t.he annual fee imposed under 10 CFR Part 171 on nuclear power
reac~rs. For the reasons 8et forth below, DPC believes that it is entitled to
this exemption under the criteria set forth in 10 CFR Part 171.11 and that it
would be in the public interest to grant this exemption request.
10 CFR Part 171, which became effective on October' 20, 1986, imposes
an annual fee of .950,000 on each power reac~r licensed to operate as of
October 1, 1986, in addition to the licensin. fees alread;y bein. imposed under
10 CFR Part 170. In adopting this new rule, the Commission specifically
indicated that it was "not the intent of the Commission to promul,ate a fee
schedule that could have the effect of imposing fees at such a level that the
owners of the handful of small, older reactors would find it in their best
economic interest to shut their reac~rs down." The Commission indicated
that it would consider exemption requests submitted in connection with such
reactors and take the following fac~rs Into consideration in reviewing such
exemption request.s:
a.
b.
c.
d.
e.
Age of the reac~r.
Size of the reactor.
Number of euatomera in rate base.
Net increase in kWh cost for each customer directly related to the
annual fee assessed under this Part.
Any ot.her relevant matter which the licensee believes justifies the
reduction of the annual fee. 10 CFR Part 171.11.
Director, Nuclear Reactor Regulation
Page 2
October 28, 1986
The Commission also indicated that it would grant exemption relief under
Part 171.1l if the licensee could demonstrate on the basis of these factors
that NRC's regulatory costs for the plant in question are reduced and that
the benefits bestowed on the licensee are below that of other plant reactors.
This exemption request will address each of the factors set forth in Part
171.11, and demonstrate (1) that DPC is entitled to favorable consideration
under all of these factors, and (2) that the fee requirements of Part. 171
should be waived in full with respect to LACBWR or alternatively reduced to
an annual fee of no more than .55,000.
a.
Me 01 the Reactor - LACBWR has been in operation for 17 years.
It is one of the four oldest nuclear power reactors subject to the
provisions of Part 171. LACBWR was originally built as a
demonstration nuclear plant for the Atomic Bnergy Commission
(AEC) under the Cooperative Power Reactor Development Program.
LACBWR went on line in November 1969, and in 1973 title to
LACBWR was transferred from the AEC to DPC. LACBWR is a mature
plant with a proven record of operating experience and the
Commission is no longer incurring the types of "start-\.i'p"
regulatory costs associated with new reactor designs and systems.
Moreover, LACBWR is an Allis-Chalmers BWR and DPC receives
little, if any, direct benefit from the "generic" regulatory costs
associated with Commission-sponsored research activities involving
advanced reactor designs and PWR's and BWR's designed by
manufacturers of the reactors utilized by other nuclear utilities.
These research costs constitute more than half of the regulatory
costs that the Commission is attempting to recover under Part 171.
In addition, because DPC has made significant upgrades to LACBWR
over the past ten years in order to meet current regulatory
requirements, it is not expected that extensive modifications, like
those required in the past, will be undertaken for the remainder of
plant life which might require intensive internal review actions by
the NRC.
b.
Size 01 the Reactor - LACBWR is the smallest nuclear power reactor
subject to the provisions of Part 171. The vast majority of u.s.
power reactors range in size from 500 to 1200 MW electric. At a
rated capacity of 50 MW electric and 165 MW thermal, LACBWR is less
t.han 10% of the size of approximately 90% of all other U.s. power
reactors and it is less than 70% of the size of the next largest
reactor subject to the new fee schedule. Charging the same fee for
LACBWR that is charged to reactors that generate more than 20 times
as much power as LACBWR imposes an unfair and disproportionate
burden on DPC. vis-a-vis other nuclear utilities. The flat fee does
not accurately reflect the lower regulatory costs attributable to the
smaller physical size of LACBWR and the reduced number and complexity
of systems and components in the plant. Again, there are few, if
any, benefits bestowed upon DPC from generic NRC regulatory
programs that benefit all other nuclear utilities because they involve
General Electric, Westinghouse, Babcock & Wilcox, and Combustion
Engineering reactors which are an order of magnitude larger in size
and more complex than LACBWR.
1-
Director, Nuclear Reactor Rearulation
Page 3
October 28, 1986
c.
Number of Customers in Rate Balle - DPC's service area includes
parts of four states in the upper north central retrion of the u.s.
(i.e. Wisconsin, Minnesota, Iowa and Illinois). DPC, as a
areneration and transmission cooperative, provides electric service to
29 distribution cooperatives which are members of DPC and which in
turn provide electric service to 170,000 customers in this rearion.
DPC's customer base is considerably smaller than the customer base
served by other nuclear utilities, particularly those servinar major
metropolitan areas, and also considerably less diversified. DPC's
customer base is primarily rural in character and has already been
under severe economic strain due to the problems besettinar the
u.s. farm economy in recent years. DPC's system has essentially
been in a zero arrowth mode over the past several years. These
new fees would further aggravate the financial problems confrontinar
DPC's member cooperatives and their customers. The additional
fees imposed under Part 171 would also place a disproportionate
share of the Commission's rearulatory costs on DPC's relatively small
customer base that receives the benefit of only 50 MW M power
production from nuclear enerary compared with the customer bases
of other nuclear utilities which (1) are much lararer, (2) receive the
benefit of much more power from nuclear enerary, and (3) are in a
much better position to absorb the additional costs associated with
these fees.
d.
Net Increase in kWh eo.t. - LACBWR currently has the hiarhest unit
power costs of any base load plant on the DPC system. Durinar
1985, the total production costs for power arenerated at LACBWR
were in excess of $0.054 per kWh compared to total production costs
of less than $0.023 per kWh from DPC's most efficient coal-fired
unit and average revenues of .0.046 per kWh from DPe'. member
cooperatives. The addition of a $950,000 annual fee under Part
171 would result in approximately a 5.4% increase in LACBWR's unit
production costs, or 3 mills more per kWh, which would further
increase the cost differential between LACBWR costs, the averaare
costs of its coal-fired units and average system revenues. The
increase in cost per kWh at LACBWR will be approximately 15-20
times greater than the increase that will be experienced at other
nuclear utilities operatinar lararer reactors where total production
costs are already much higher. An increase of this maarnitude will
have a significant adverse impact on DPC's member cooperatives
and customers. LACBWR contributes less than 8.5% of DPC's
installed base load arenerating capacity, but it does reduce DPC's
dependence on coal as the primary fuel source for base load plants.
However, the proposed ten-fold cost increase for rearulatory services
under Part 171, versus the average fees paid under 10 CFR
Part 170 in recent years, will -- unless waived or substantially
reduced by the Commission -- drastically impact the economics
associated with the operation of LACBWR.
(
IJ
Director, Nuclear Reactor
Page 4
October 28, 1986
e.
Re~ulation
other Relevant Mattera - As noted previously, LACBWR was
constructed by the AEC under the Cooperative Power Reactor
Development Proaram - a ~overnment-spon80red pro~ram desianed
to stimulate the development of the nuclear power industry and
encourage widespread participation in this development by
demonat.ratina that small-scale nuclear power plants could be
economically operated. DPC participated in LACBWR at the ur~in~
of the AEC and became subject to licensina pursuant to the
contractual arran~ements with the AEC transferring ownership of
the plant and operational responsibilities tor the plant to DPC. The
imposition of unduly burdensome and disproportionate fees on
LACBWR at this juncture could have an adverse impact on the
willin~ness of other utilities to participate in similar
~overnment-spon80red energy projects in the future.
In addition,
LACBWR is unique in many respects. It is the only nuclear power
reactor in the United States that is entirely owned and operated by
a rural electric ~eneration and transmission cooperative. The
continued operation of LACBWR enables DPC to lessen iftl dependence
on coal-fired ~eneratin~ capacity and maintain a more diversified
fuel am tor its base load plants. However, the impact of the new
fees on the economics associated with continued operation ot
LACBWR could ultimately force DPC to increase its dependence on
coal-fired capacity. Such a development would not be in the best
interest of DPC's member cooperatives or the consuming public.
To DPC's knowledge, every other fee imposed upon nuclear utilities
by regulatory agencies, other ~overnment entities, and private
trade associations and industry ~roups to administer their programs
and recover their costs is based upon the number and size of the
reactors involved, the ~ross revenues or total power production of
the utility involved, or the total production of the nuclear power
plants involved (e.~. the DOE High Level Waste Fund, char~es
imposed by the Wisconsin Public Service Commission, EEl, EPRI,
INPO, etc.). Yet, the new rule would impose the same $950,000 fee on
LACBWR that is imposed on a typical large reactor such as the 1250
MWe Grand Gulf reactor. Based on the relative size of these two
reactors, DPC should only be required to pay 4% of the amount paid
tor a lar~er reactor or $38,000. DPC recognizes that the NRC's
goal is to recover $96 million this year under 10 CFR Part 171.
This $96 million amounts to approximately $1,111 per MWe of
installed nuclear generating capacity in the United States. At 50
MWe, the tee imposed on LACBWR would only be around $55,000 if
reactor size were the criteria utilized to assess fees. Absent this
exemption, DPC will, therefore, be required to pay over 17 times
the amount that it would otherwise be required to pay under the
~eneral1y-accepted fee criteria utilized throughout the ~overnment
and industry.
'·'I~_r
_ _. _ .
Direc tor, Nucle ar React or
Page 5
Octob er 28, 1986
Re~ul ation s
many respe cts,
In summ ary, DPC believ es that its situat ion is uniqu e in
ic coope rative , the
in light of LACBWR's size, DPC's statu s as a rural electr
and the ori~ins of
size and chara cter of the DPC system and custo mer base,
es that it is entitl ed
DPC's partic ipatio n in the nucle ar indus try. DPC believ
in 10 CFR Part
to favor able consi derati on under all five facto rs set forth
annua l fee impos ed
171.11 . DPC shoul d simpl y not be subje cted to the same
s ~enerating far more
on other much large r utiliti es that opera te nucle ar plant
diver se custo mer
powe r than LACBWR and servin~ much large r and more
r and which are far
bases which receiv e far more benef its from nucle ar powe
171.
more capab le of abscr- bing the fees impos ed under Part
y reque sts that
For all the foreg oing reaso ns, DPC there fore respe ctfull
l fees
annua
the
from
tion
exemp
nent
the Comm ission ~rant DPC a perma
ar as
insof
ether
altog
fees
these
waive
and
impos ed unde r 10 CFR Part 171
to no more than
they apply to DPC or, in the altern ative, reduc e these fees
$55,00 0 per year.
to i1iake the
DPC also respe ctfull y reque sts that DPC not be requi red
new rule with
first quart erly instal lment of any paym ent due unde r the
of a final decisi on
respe ct to LACBWR until ten (10) days after the issua nce
by the Comm ission on this exemp tion reque st.
Since rely,
JWT/R ES/cl s
STATE OF WISCONSIN }
}
COUNTY OF LA CROSSE }
r; )- ~ ,
1986, the above
Perso nally came befor e me this .:2. Y day of
execu ted the
named James W. Taylo r to me know n to be the perso n who
foreg oing instru ment and ackno wledg ed the same.
Ann4!::J· ~
Notar y Publi c
La Cross e Coun ty, Wisco nsin
My Comm ission Expir es 02/21 /88
-------_._----------
ENCLOSURE 3
Ltr dated November 7, 1986 from K. W. Berry (Consumers
Power Company) to Executive Director for Operations
Enclosure 3
Consumer~
Power
Kenneth W Berry
/);,rC'Io,
NIIC'lrtJ' uC'rrui,.,
flllWf lUNIi
M'''''I iAII-S PROIiRlSS
788.1836
Genera' Oft_: '145 Wall 'arna" Road. JacltlOfl. MI .8201 • (5171
November 7, 1986
'.
Execu tive Direc tor for Opera tions
US Nucle ar Regul atory Commission
Washi ngton , DC 20555
DOCKET 50-155 - LICENSE DPR-6 - BIG ROCK POINT PLANT 10CFR171 ANNUAL FEE EXEMPTION REQUEST
Consumers Power
Pursu ant to 10CFRI71.11, for the reaso ns set forth herei n, ts of 10CFR171.15
emen
Company reque sts an exemp tion from the annua l fee requir
e which publis hed
for Big lock Point . As stated in the Feder al Regis ter noticlicen sees of
some
the new fee rule, the NRC recog nizes the proble m that
fees and there fore
small er react ors may have in payin g subst antia lly increa sed
has provid ed for fee exemp tions.
ts the follow ing:
In suppo rt of this reque st, Consumers Power Company submi
May I, 1964.
Big Rock Point is the holde r of NRC Licen se No. DPR-6, dated
1.
react or
water
g
boilin
ric
The plant is the oldes t opera ting Gener al Elect
s in
plant
ating
gener
ar
nucle
ercial
and one of the oldes t opera ting comm
31,
May
on
es
expir
se
licen
tittg
opera
the Unite d State s. Big Rock Point 's
ning.
remai
tion
opera
plant
of
2000. This leave s less than 14 years
under lying the
Because of Big Rock Point 's age, many of the gener ic costs
.
Point
Rock
new fee rule are not relev ant to Big
2.
3.
Big Rock
In addit ion to being one of the oldes t commercial react ors,
ating
gener
ar
nucle
ercial
comm
ting
Point is the secon d small est opera
This
net.
MWe
69
is
t
outpu
's
Point
Rock
pl8Dt in the Unite d State s. Big
n
moder
ge
avera
the
than
less
tude
magni
outpu t is more than one order of
.
vintag e comm ercial gener ating plant
entall y
A IBrch arge of $950,0 00 in annua l licen se fees would incremappro ximat ely
by
ction
produ
rical
elect
of
increa se Big Rock Point 's cost
addit ion to our
2.5 aills per kilow att-ho ur. This surch arge would be inper
year. An
curre nt avera ge 10CFR170 fees of appro ximat ely $130, 000
8611 1002 86 8611 07
~DR ADOCK 0500 0155
PDR
OCI086-0176-NL02
Executive Director for Operations
Big Rock Point Plant
10CFR171 Annual Fee Exemption Request
November 7, 1986
2
increase of this magnitude is unreasonable for a generating plant of this
emaIl size. The impact of this surcharge would be approximately 12 times
as great as it will be for a typical modern vintage plant. Even without
increased license fees, recent industry analyses have shown Big Rock
Point's operating costs on a kilowatt-hour basis to be among the highest
in the industry.
4.
Because our current electric rates do not reflect tbe Dew fee, it could
not be passed on to our customers without filing a new rate case with the
Michigan Public Service Commission. At the present time, the regulatory
climate within the state is volatile, and the outcome of any new rate
case filing would be unpredictable. This is due in part to Consumers
Power Company's recent financial problems and the visibility these
problems have created in the state regulatory arena. Also, intervenors
in a fuel and purchased power cost recovery proceeding are presently
contending that Big Rock Point should not be allowed to remain in the
rate base due to bigh operating and,maintenance costs of the facility.
5.
Big Rock Point's small size and rural location is less of a potential
hazard to public health and safety than most other commerci~ nuclear
generating plants. Plant age, size and location have also been recognized by the NRC in other regulatory contexts. These include the emergency planning zone, insurance and backfitting rules.
6.
Over the last several years, Big Rock Point performance has been above
average in SALP ratings, capacity factor and availability. This has
resulted in less NRC regulatory effort being spent on Big Rock Point.
Because Big Rock Point's kilowatt-hour output is small and the plant is old,
the cost-benefit of the new fee should be recognized. As stated in the
Federal Register notice which published the new rule, it is not the intent of
the NRC to promulgate a fee schedule at such a level that smaller, older
reactors would find it in their best economic interest to shut down. We feel
that the majority of the regulatory costs and benefit gains associated with
Big Rock Point would reasonably be collected under the existing 10CFR170 fee
structure.
In conclusion, Consumers Power Company contends that because of the tenuous
economic viability of Big Rock Point, any increase in licensing fees is
'unreasonable and overly burdensome. We request that an exemption be granted
that requires Big Rock Point to pay not more than $27,000 in annual licensing
fees under 10CFR171. This amount is based on the fact that Big Rock Point is
69/850 the size of the average plant and has only 14/40 years of operation
left [(69/850) x (14/40) x ($950,000) • $27,000]. The average plant size was
calculated from NOREG 0020, June 1986 data [85,190 Mwe/100 plants • 850
average MWe/plant]. We believe that establishing an annual fee on the basis
of plant size and age is appropriate justification.
OCI086-0176-NL02
-------------------,
r
.
Executive Directnr for Operations
Big Rock Point Plant
10CFR171 Annual Fee Exemption Request
November 7, 1986
3
To reduce the administrative costs of filing an annual exemption request, we
also request the exemption be made permanent. Pursuant to ~1RC Invoice F0085
dated November 19, 1986, a full quarterly installment of $237,500 will be
remitted for Big Rock Point. Subsequent to NRC action on this exemption
request, and if the exemption is granted, a refund of the difference is hereby
requested.
Kenneth WBerry
Director, Nuclear Licensing
CC
\
Director, Nuclear Reactor Regulation
Administrator, Region III, USNRC
NRC Resident Inspector - Big Rock Point
OCI086-0176-NL02
•
ENCLOSURE 4
Summary Sheets (3)
Enclosure 4
t
•
YANKEE NUCLEAR POWER STATION
YANKEE ATOMIC ELECTRIC COMPANY
DOCKET NO. 50-029
FACILITY OPERATING LICENSE NO. DPR-3
Age of Reactor
Yankee is the oldest commercial operating reactor at 26 years old.
issued July 19, 1960, expiration date is November 4, 1997).
(License
Size of Reactor
Yankee is about one-fifth thp. size of the average plant at 600 MW thermal,
175 MW electrical.
Number of customers in rate base
Net increase in Kwh cost for each customer directly related to the annual
fee assessed.
Yankee was formed for the exclusive purpose of constructing and operating New
England's first nuclear plant. Yankee has no retail customers; the energy
production is sold to the 10 New England utilities that own Yankee. The
annual fee will increase costs per Kilowatt hour by approximately 1 mill,
which is about six times greater than the increase that will be experienced by
more recent vintage plants.
Other relevant matters
Smaller plants are more sensitive to increasing costs, as evidenced by the
relatively high operating and maintenance costs even with good plant
capacity factors. Such sensitivity has been acknowledged in other regulatory
contexts, such as the insurance rule and backfitting.
SALP ratings have been consistently high, thus, special inspections and
reviews of operating experience costs are lower.
Yankee poses less of a potential hazard than most other plants because of its
simpler design, diversity of heat removal systems, design margins, small core
size and the remote siting.
Because of the older design, many of the generic activities covered by the
rule are not applicable, such as thermal-hydraulics codes and earth science
research.
•
BIG ROCK POINT PLANT
CONSUMERS POWER COMPANY
DOCKET NO. 50-155
-6
FACILITY OPERATING LICENSE NO. DPR
Age of Reactor
cto r
al Ele ctr ic bo ilin g water rea
ner
Ge
ing
rat
ope
est
old
se
the
cen
is
(Li
Big Rock Point
rea cto rs at 22 years old .
ing
rat
ope
l
rcia
me
com
est
old
and one of the
e is May 31, 2000).
issued May 1, 1964, exp ira tio n dat
Size of Reactor
an output
mercial operating pla nt with the
com
est
all
sm
ond
sec
the
is
nt
of
Big Rock Poi
is les s than one-tenth the siz e
of 69 MW ele ctr ica l. This output
average modern pla nt.
k Point rat e base
Number of customers in the Big Roc
20,600 at 85% Capacity Factor.
dir ect ly rel ate d to the annual
er
tom
cus
h
eac
for
t
cos
KWh
in
Net increase
fee assessed
att hour by approximately 2.5
ow
kil
per
ts
cos
se
rea
inc
l
wil
t wi ll be
The annual fee
es gre ate r than the inc rea se tha
mi lls , which is about 12 timvin
tage pla nts .
experienced by more rec ent
Other rel eva nt matters
the
sin g co sts , as evidencednt bycap
rea
inc
to
ive
sit
sen
e
aci ty
mor
are
Smaller pla nts
ce cos ts even wi'th good pla lyses have
nan
inte
ma
and
ing
rat
ope
h
hig
ly
rel ati ve
ust ry ana
sed lic ens e fee s, recent ind
bas is to be among
fac tor s. Even without increa
ur
-ho
att
ow
on a kil
ts
cos
ing
rat
ope
's
int
Po
k
Roc
shown Big
the hig hes t in the ind ust ry.
the
generic act ivi tie s covered by
the
of
y
man
,
ign
des
er
e
old
enc
the
sci
Because of
hydraulics codes and ear th
alrm
the
as
h
suc
e,
abl
lic
app
rul e are not
res ear ch.
l hazard
ati on is les s of a po ten tiaall
loc
al
rur
and
e
siz
all
sm
's
core
int
Big Rock Po
des ign , design margins, sm
r
ple
sim
its
of
e
aus
bec
nts
pla
than oth er
siz e, and the remote sit ing .
rage over the las t several yea rs.
SALP rat ing s have been above ave
h the
new fee . A new rat e case wit
the
t
lec
ref
not
do
es
rat
ic
ren t
ctr
Current ele
e to be undertaken. The curpan
hav
uld
wo
sion
mis
Com
e
vic
Ser
c
Michigan Publi
par t to Consumers Power Com y's
in
due
ile
lat
vo
is
ate
clim
y
sta te reg ula tor
rec ent fin anc ial problems.
-------------------------
.
'.
LA CROSSE BOILING WATER REACTOR
DAIRYLAND POWER COOPERATIVE
DOCKET NO. 50-409
PROVISIONAL OPERATING LICENSE NO. DPR-45
Age of Reactor
La Crosse Boiling Water Reactor (LACBWR) is one of the four oldest commercial
operating reactors subject to the provisions of Part 171. The unit began
commercial operation in November 1969.
Size of Reactor
LACBWR is the smallest commercial nuclear power unit in the U.S. Its net
generating capacity is 50 MWe.
Number of Customers in Rate Base
Dairyland Power Cooperative (DPC), owner and operator (licensee) is a generation
and transmission cooperative whose 29 distribution cooperative ~ovides service
to 170,000 customers in the DPC region. This customer base is considerably less
than that of other nuclear utilities, and is primarily of a rural nature.
Net Increase in KWh Cost
LACBWR currently has the highest unit power cost of any base load plant in the
DPC system. The annual fee required by Part 171 will increase the cost of
production by approximately 3 mills per KWh. The increase would be 15-20 times
greater for La Crosse than the increase that will be experienced at other (larger)
reactors.
Other Relevant Matters
LACBWR was constructed for the AEC to demonstrate the economic feasibility of
small nuclear power generating plants. At the urging of the AEC, DPC took
ownership of LACBWR and assumed operational responsibility under a licensing
agreement with AEC. The unit provides diversification to avoid complete
dependency by DPC on coal. The economics are such that unless substantial
relief from the fee required by Part 171 is provided, DPC could be forced to
become entirely dependent on coal.
The sensitivity of small plants to increasing operational costs has historically
been recognized, in that most if not all other fees imposed by regulatory
agencies, other government entities and private trades associations and industry
groups to administer their programs and recover costs are based upon generating
capacities of the plants.
As a very small nuclear unit, LACBWR poses less of a potential hazard than
other nuclear units because of its small core size, simpler design, and overdesigned safety margins, and thus has historically required less requlatory
attention than larger nuclear units.
"
•
ENCLOSURE 5
Computation of Proposed Adjusted Annual Fee
---------------------,--
"
•
Enclosure 5
COMPUTATION OF PROPOSED ADJUSTED ANNUAL FEE TO BE
,
ASSESSED USING THE AVERAGE OF TWO METHODS SHOWN BELOwlJ
La Crosse
Big Rock Point
Yankee Rowe
Methods Used to Determine
Adjusted Fee:
l.
Thermal Megawatt
Rating Ratio
Plant/Average P1ant 2/
165
~lWt
240 MWt
600 MWt
2671 MWt
2671 MWt
$84,000
$211,000
$58,000
2671 MWt
2.
Comparable impact of
Annual Fee on Plant
Kilowatt hour costs3/
$55,000
$78,000
$156,000
3.
Proposed Adjusted Annual $56,000
Fee - Average of methods
1 and 2
(% of Unadjusted Annual Fee) (6%)
$81 ,000
$183,000
(9%)
..
(19%)
Other Items For Comparison:
Increase in mill ratei/
3 mi 11 s
per KWh
2.5 mi 11 s
per K\;h
1 mi 11
per KWh
Remaining years of
operation
16/40
40%
16/40
40%
14/40
35%
Licensee suggested fee
not to exceed
$55,000
not to exceed
$27,000
not to exceed
$50,000
lI once
the determination is made that a partial exemption, in the form of an adjusted
fee, is appropriate and after applying the factors in 10 CFR 171.11, several possible
methods may be used to determine the adjusted fee either singly or in combination.
Using these two methods, the resultant dollar amounts were averaged to arrive at the
adjusted annual fee for each plant. The adjusted fee under Part 171 is collected in
addition to fees collected under 10 CFR 170.
2/Under this method, the adjusted fee is determined by multiplying the unadjusted
- annual fee ($940,000) by the thermal megawatt rating of the plant divided by
the average thermal megawatt rating of the 101 licensed plants (2671 Mwt).
3/Under this method, the unadjusted annual fee ($940,000) is adjusted such that
- the incremental kilowatt-hour costs for the plant are similar to the incremental
costs for larger modern plants. Incremental kilowatt-hour costs for each of
the three plants are presented at Enclosure 4.
lI The amount of increase if the 10 CFR 171 annual fee of $950,000 were to be used.