Enforcement Action Initiated Against Holtec re Spent Fuel Cask Design

On December 27, 2018, the U.S. Nuclear Regulatory Commission (NRC) announced that the agency plans to bring an enforcement action against Holtec International — the manufacturer of the steel and concrete casks used at the Vermont Yankee nuclear power plant to store spent fuel.

NRC officials held a pre-decisional enforcement conference with Holtec officials from 1:00 – 5:00 p.m. ET on January 9, 2019.  The conference, which was held in the Commission Hearing Room at NRC Headquarters, was open to the public and webcast.

For additional information on the webcast, please go to https://video.nrc.gov.


The issue originated when a loose bolt was identified in the 18-foot tall casks at the San Onofre Nuclear Generating Station in California in March 2018.  Workers at the San Onofre Nuclear power plant discovered a loose four-inch stainless steel pin at the bottom of a canister as it was being prepared for loading with spent fuel.  The pin was part of a shim designed to support the fuel basket and allow airflow to the fuel assemblies within the canister.  As such, the shim is considered essential to the function of the fuel basket.  Regulators are concerned that the problem could affect the ability of the casks to effectively cool the nuclear fuel.

Since the Vermont Yankee plant shares a similar cask design as San Onofre, a two-month halt was initiated earlier this year when Entergy Nuclear Corporation was transferring the plant’s spent nuclear fuel to the air-cooled storage casks.  The transfer resumed in May 2018 and was completed this past summer.

During the two-month hiatus at Vermont Yankee, Entergy inspected the empty Holtec Hi-Storm 100 casks that Holtec had already provided for the fuel transfer and storage project and found no problems with the casks.  Entergy used a total of 58 casks, but it could not inspect the canisters already filled with fuel.  According to NRC, 31 of the 58 casks at the Vernon site were of the new Holtec design.

Transfer of the spent fuel was a key condition of the pending sale of Vermont Yankee by Entergy to NorthStar Holding Company.  The sale, which has received both state and federal approval, is expected to be completed early in the 2019 calendar year.


The action against Holtec International involves a new design that the company adopted for its casks before getting NRC approval.  The design has since been approved, according to an agency representative.

In particular, NRC asserts that Holtec changed the design of the Hi-Storm 100 casks — specifically the four-inch stainless steel pins that hold the basket, which in turn holds the spent fuel.  Holtec determined that it did not need to conduct a written evaluation, which was a violation of NRC safety regulations according to agency officials.  In the notice of violation from the NRC, the agency referred to “nonconforming and degraded conditions at both SONGS (San Onofre Generating Station) and VY [Vermont Yankee], respectively.”

NRC conducted an inspection at Holtec’s offices in Camden, New Jersey.  On November 29, 2018, NRC issued an inspection report identifying two apparent violations of the agency’s quality assurance regulations.  The NRC determined Holtec, when it changed the shim to the pin design in 2016, failed to establish adequate design control measures for selecting and applying materials, parts, equipment and processes essential to the function of safety-related structures, systems and components.  Holtec also failed to maintain written records of changes to its canister design, including an evaluation of why the design change could be implemented without applying to the NRC for an amendment to the canister’s Certificate of Compliance.

The NRC offered Holtec a choice between the pre-decisional enforcement conference or third-party mediation.  Holtec chose the conference, during which its officials will be able to present additional information for the NRC staff to consider in assessing the significance of the subject violations.  No final action will be taken at the conference on January 9, 2019.In addition to San Onofre and Vermont Yankee, the Holtec Hi-Storm 100 casks were also used to store spent fuel at nuclear plants including Dresden in Illinois; Grand Gulf in Mississippi; Hatch in Georgia; Columbia in Washington; Watts Bar in Tennessee; and, Callaway in Missouri.

For additional information, please contact David McIntyre of the NRC at (301) 415-8200.

Texas Compact Facility Legislative Oversight Report Released

On December 1, 2018, the Joint Compact Facility Legislative Oversight Committee (Joint Committee) submitted its report on the Texas Low-Level Radioactive Waste Disposal Compact (Texas Compact) facility to the Senate Committee on Natural Resources and Economic Development and the House Committee on Environmental Regulation.

The Joint Committee was established pursuant to House Bill (HB) 2662, which was passed by the 85th Legislature during the regular session.  The Joint Committee heard invited and public testimony during a scheduled hearing on September 6, 2018.


Since opening in 2012, Waste Control Specialists (WCS) has operated at a loss.  According to the Joint Committee’s report, “there is continued concern that the current regulatory scheme, including fee allocation, is prohibitively cumbersome and that it may prevent any owner of the Facility from operating at a profit.”

The following is the charge for the Joint Committee pursuant to HB 2662:

Assessment of the Texas Low-Level Radioactive Waste Disposal Compact facility to include recommendations relating to costs, fees, and any other matters the legislative oversight committee determines are relevant to the compact facility and oversight of the compact facility. Report must include the results of the assessment.


The following overview of the Joint Committee’s recommendations includes detailed excerpts from the report.  Interested stakeholders seeking additional information should review the report in its entirety.

  • Waste Disposal Rates for In-Compact Generators The Joint Committee recognized the intent of the rate rule, while acknowledging that current compliance regulations pose a risk to the financial viability of a private operator.  The Joint Committee expressed a desire to retain the spirit of the rate rule by providing low prices to in-compact generators, but recognized that the contract review process has proven to be an impediment to WCS’s desire to participate in the free market for out-of-compact waste.  In the Committee’s discussion of the rate rule and pricing issue, a number of possible solutions were developed to the issues posed by the rate rule. The proposals included accepting WCS’ request to untether non-compact waste from the rate rule; creating a floating rate that is more adaptable to market conditions; and, developing quicker mechanisms to ensure compliance.
  • Contract Review The Joint Committee expressed concerns with allowing private companies to audit another private company with whom they are actively negotiating contracts due to the inequitable negotiating position in which WCS would be placed.  The Joint Committee further expressed concerns with adopting an alternative compliance mechanism without specificity in how it would be implemented.  Absent a sufficient regulatory framework, if in-compact generators and WCS ever disagreed on compliance with a contract, a potential for routine litigation may be created.  The Joint Committee recognized that untethering the out-of-compact rates would eliminate the need for a cumbersome contract review process.  The Joint Committee also discussed statutory changes that would allow TCEQ to review an aggregation of contracts rather than reviewing them on an individual basis.  Practically speaking, TCEQ would review both in-compact and out-of-compact contracts over a certain period of time and compare the average rates for each to verify compliance.
  • Fees and Surcharges The Joint Committee discussed the amount and purpose of the fees and surcharges assessed on both in-compact and out-of-compact waste.  The Joint Committee recognized that the default surcharge levels of 36.25% and 16.25% are excessive, especially in light of WCS’s competitor’s surcharges, and found that a reduction in fees may be reasonable.  The Joint Committee further recognized that reducing the surcharges would result in an increase in both in-compact and out-of-compact waste because WCS would be able to offer more competitive rates.  The Joint Committee considered that despite reducing the surcharges, the state might actually receive a greater financial benefit due to the increased volume of waste disposed that would be incentivized by lower surcharges.
  • Waste Disposal Capacity The Joint Committee recognized the balancing that is needed to ensure there is capacity for in-compact generators while also allowing WCS to accept imported waste to finance the operation and expansion of the facility.  In discussing this balance, a number of suggestions were made.  One suggestion was to aggregate the 275,000 annual curie limit over ten years, meaning the limit on imported waste would be 2.75 million curies over ten years.  This would provide WCS with the flexibility to bid on potential larger contracts without eliminating or increasing the average annual curie limit.  The Joint Committee noted that ARDT is requesting that capacity be guaranteed for in-compact waste without a guarantee that the in-compact generators will use the CWF instead of the alternative disposal and storage options.  Furthermore, imposing such a requirement necessarily requires a capital investment by WCS, while at the same time impeding their ability to compete for profit generating contracts.  In light of this, the Joint Committee also discussed imposing “take or pay” provisions.  This would require the in-compact generators to either use the facility or pay a fee for not meeting certain disposal quotas.  This would likely be based on ARDT’s suggested operational trigger that considers average historic volume disposed.  Requiring the in-compact generators to prepay for capacity was also an option discussed.  This would provide WCS with the capital necessary to build out capacity and also serve to incentivize in-compact generators to use the facility.
  • Fixed Costs/Costs of a State-Operated Facility The Joint Committee discussed alternatives to having a private operator for the CWF as it currently exists.  The Joint Committee unanimously expressed concerns regarding the potential cost if the state were to operate the CWF.  Furthermore, when specifically asked if TCEQ possesses the requisite expertise to manage and operate a CWF, TCEQ acknowledged that they do not.  The Joint Committee recognized that no existing state agency or office has the requisite expertise or ability to maintain and operate a CWF.  The state would thus need to appropriate funds to secure a contractor to operate the site on the state’s behalf.
  • Contingency Plan In response to the testimony provided by the Texas Compact Commission, the Joint Committee expressed serious concerns that a comprehensive contingency plan has yet to be developed, notwithstanding the Commission’s reservations about directing the state to take prescribed actions without input from a designated state office or agency.  While the Joint Committee recognized that the Texas Compact Commission does not have authority to access funds to implement the plan, it stated that the legislature could appropriate those funds separately, should the need arise to implement the plan.


Texas and Vermont are currently members of Texas Compact for the purposes of assuring that each state is able to efficiently and safely dispose of low-level radioactive waste.  Per the terms of the Texas Compact, the State of Texas serves as the host state, meaning that Texas is responsible for providing a CWG to dispose of low-level waste generated within each state.  In exchange for serving as the host state, Texas received $25 million from Vermont.  The Texas Compact created the Texas Compact Commission whose primary responsibility is to ensure capacity at the CWF is available for the in-compact generators.

By far the largest generators of low-level waste are the nuclear power plants in each state.  There are two operational plants located in Texas and one plant in Vermont, the latter of which is expected to begin decommissioning in late 2019.  Other generators include universities and hospitals and research facilities.  The in-compact generators are represented by ARDT.

The Texas Compact creates a distinction between “in-compact waste” and “imported waste” or “non- compact waste.”  In-compact waste refers to waste generated from within the member states of Texas and Vermont.  Imported waste, or non-compact waste, is waste generated in any other state.  There are currently 34 states that are not in a compact or do not have a facility at which they can dispose of certain classes of low-level waste, namely Class B and Class C waste.

In order to satisfy Texas’ obligations under the Texas Compact, the state initially took steps to develop a CWF known as the Sierra Blanca site in Hudspeth County.  The site was ultimately unsuccessful in obtaining a license from the Texas Natural Resource Conservation Commission (TNRCC).  Subsequently, the legislature created a regulatory structure that allowed for a private operator to receive a permit to construct and operate the CWF.  WCS applied for, and was granted, a permit from the TCEQ – the regulatory agency responsible for permitting radioactive waste in Texas. WCS then financed the construction of the CWF, understanding that the state assumes legal liability for the waste buried at the CWF.

For additional information, please contact Texas Compact Commission Executive Director Leigh Ing at (512) 305-8941 or at leigh.ing@tllrwdcc.org

Holtec Requests NRC Approve Sale of Pilgrim Site by End of 2019

Seeks to Complete Decommissioning Decades Earlier

On November 16, 2018, Entergy Corporation and Holtec International, through their affiliates, asked the U.S. Nuclear Regulatory Commission (NRC) to approve the sale of the Pilgrim Nuclear Power Station to Holtec after shutdown.  According to the associated press release, doing so would allow Holtec to complete decommissioning and site restoration decades sooner than if Entergy completed decommissioning.

OverviewThe companies jointly filed a License Transfer Application, requesting approval for the transfer of the Pilgrim Nuclear Power Station, as well as its Nuclear Decommissioning Trust Fund, to Holtec after the plant permanently shuts down by June 1, 2019.  They also made detailed separate filings that lay out the process each company would use to decommission the facility.

In order to facilitate a timely transaction closing by the end of 2019, the companies have asked the NRC to approve the application by May 31, 2019.  According to the press release, doing so will benefit the community, employees and other interested constituents.

Holtec’s filings describe the plan of its subsidiary, Holtec Decommissioning International, to complete the dismantling, decontamination and remediation of Pilgrim to NRC standards within eight years of license transfer (i.e., by the end of 2027) assuming timely regulatory approvals.  According to the press release, Holtec’s process will achieve site restoration decades sooner than if Entergy retained the plant while meeting all applicable local, state and federal regulations.

Holtec estimates total costs for decommissioning Pilgrim at $1.13 billion.  As of October 31, 2018, the balance in Pilgrim’s Decommissioning Trust Fund was $1.05 billion.

Holtec has contracted with Comprehensive Decommissioning International, LLC (CDI) to perform the decommissioning, including demolition and site cleanup.  CDI is a joint venture company of Holtec International and SNC-Lavalin.  According to the press release, “The decommissioning experience held by Holtec and SNC-Lavalin gives CDI more than half a century of managing complex projects in both the commercial and government nuclear sectors worldwide.”

Project Highlights

The completion of decommissioning will result in the release of all portions of the site from the current NRC license, with the exception of the Independent Spent Fuel Storage Installation (ISFSI) – the area where spent nuclear fuel is stored in dry casks until the U.S. Department of Energy (DOE) transfers the spent fuel offsite.

As part of its plan, Holtec expects to move all spent nuclear fuel into dry casks within three years following plant shutdown.  Additionally, Holtec has a pending application with the NRC for a Consolidated Interim Storage Facility (CISF) in New Mexico, which could eventually store spent nuclear fuel from Pilgrim and other U.S. nuclear power plants.


The Pilgrim Nuclear Power Station employs about 600 nuclear professionals and generates 680 megawatts of virtually carbon-free electricity, enough to power more than 600,000 homes.  Pilgrim began generating electricity in 1972.  Entergy purchased the plant in 1999 from Boston Edison.

Entergy Corporation is an integrated energy company engaged primarily in electric power production and retail distribution operations.  Entergy owns and operates power plants with approximately 30,000 megawatts of electric generating capacity, including nearly 9,000 megawatts of nuclear power.  Entergy delivers electricity to 2.9 million utility customers in Arkansas, Louisiana, Mississippi and Texas.  Entergy has annual revenues of approximately $11 billion and more than 13,000 employees.

Holtec International is a privately held energy technology company with operation centers in Florida, New Jersey, Ohio and Pennsylvania in the United States.  Globally, Holtec International has operation centers in Brazil, Dubai, India, South Africa, Spain, the United Kingdom and Ukraine.  Holtec’s principal business concentration is in the nuclear power industry.  Since the 1980s, Holtec has been densifying wet storage in nuclear plants’ spent fuel pools, which defers the need for and expense of alternative measures by as much as two decades.  Holtec has done this at over 110 reactor units in the United States and abroad.  Holtec also offers services regarding dry storage and transport of nuclear fuel.  Holtec is working to develop the world’s first below-ground CISF in New Mexico and a 160-Megawatt walk away safe small modular reactor, SMR-160.  The SMR-160 is developed to bring cost competitive carbon-free energy to all corners of the earth including water-challenged regions.  Holtec is also a major supplier of special-purpose pressure vessels and critical-service heat exchange equipment such as air-cooled condensers, steam generators, feedwater heaters and water-cooled condensers.  Virtually all products produced by Holtec are built in its three large manufacturing plants in the United States and one in India.

For additional information about the Pilgrim plant, please go to www.pilgrimpower.com.  Additional information about Entergy is available at www.entergy.com.  To learn more about Holtec International, please visit www.holtecinternational.com.  

US Ecology Announces Purchase of Ecoserv Industrial Disposal

On November 14, 2018, US Ecology announced the acquisition of Ecoserv Industrial Disposal — a wholly owned subsidiary of Ecoserv and a leading provider of non-hazardous industrial wastewater disposal solutions in the Gulf Coast.


The Ecoserv Industrial Disposal facility employs deep-well injection technology and is strategically positioned within reach of key markets such as Houston and Beaumont in Texas and Lake Charles in Louisiana.  The facility serves refinery, petrochemical and environmental services customers.  Total consideration for the business and related property was $87.2 million, subject to a working capital adjustment, and will be funded from cash on hand and US Ecology’s existing credit facility.

“This acquisition adds unique, high volume industrial liquids disposal capabilities, complements other investments we’ve made in the region, and strengthens our comprehensive environmental services offerings,” commented US Ecology Chair, President and Chief Executive Officer Jeff Feeler.  “The facility, permitted for a wide variety of non-hazardous industrial waste including solids, sludges, leachate, and ammonia, offers a lower cost alternative to traditional wastewater treatment.”

The transaction closed on November 14, 2018.  It will be reported as part of the Environmental Services segment.  The transaction is expected to be accretive to earnings per share.  US Ecology expects no significant financial impact to 2018 earnings per share or Adjusted EBITDA for the six weeks of ownership in 2018 and reaffirms its previously issued 2018 earnings guidance that was disclosed in the company’s third quarter earnings release on November 1, 2018.  US Ecology expects the acquisition to contribute approximately $9.0 million to $10.0 million of Adjusted EBITDA in 2019. 


US Ecology is a North American provider of environmental services to commercial and government entities.  The company addresses the complex waste management needs of its customers, offering treatment, disposal and recycling of hazardous, non-hazardous and radioactive waste, as well as a wide range of complementary field and industrial services.

“US Ecology’s focus on safety, environmental compliance and best–in-class customer service enables us to effectively meet the needs of our customers and to build long-lasting relationships,” states the company’s press release.  “US Ecology has been protecting the environment since 1952 and has operations in the United States, Canada and Mexico.”

For additional information, please contact Joe Weismann at (208) 331-8400 or at jweismann@usecology.com or go to www.usecology.com.

NRC Approves License Transfer for Vermont Yankee

On October 12, 2018, the U.S. Nuclear Regulatory Commission (NRC) announced that the agency has issued an Order approving the transfer of the operating license for the Vermont Yankee nuclear power plant from Entergy Nuclear Operations, Inc. (Entergy) to NorthStar Nuclear Decommissioning Company, LLC (NorthStar NDC).

Entergy requested the transfer to NorthStar NDC to decommission the plant, which ceased operations in December 2014.


Based on its review, the NRC confirmed that NorthStar NDC met the regulatory, legal, technical and financial requirements necessary to qualify them as a licensee.  The NRC also determined that the transfer is consistent with law and NRC regulations, as well as that the transfer can be conducted without endangering the health and safety of the public and will not be inimical to the common defense and security.

The NRC Order approving the transfer was issued on October 11, 2018.  The Order and other documents related to the license transfer review are available in the NRC’s ADAMS online database at ML18242A638.


Based on the staff’s review, NRC approved the application for transfer of the licenses for the Vermont Yankee nuclear power plant subject to the following conditions:

  • prior to the closing of the license transfer, NorthStar NDC and NorthStar Vermont Yankee, LLC (NorthStar VY) shall provide the Directors of NRC’s Office of Nuclear Material Safety and Safeguards (NMSS) and Office of Nuclear Reactor Regulation (NRR) satisfactory documentary evidence that they have obtained the appropriate amount of insurance required of a licensee under 10 CFR 140.11(a)(4) and 10 CFR 50.54(w) of the Commission’s regulations, consistent with the exemptions issued to Vermont Yankee on April 15, 2016;
  • NorthStar VY and NorthStar NDC shall take no action to cause NorthStar Group Services, Inc. to void, cancel or modify the $140 million support agreement to provide funding for Vermont Yankee as represented in the application without prior written consent of the NRR Director; and,
  • NorthStar VY shall obtain a performance bond if a settlement agreement with the U.S. Department of Energy (DOE) on federal reimbursements for spent fuel management expenses is not entered into by January 1, 2022.

The performance bond will be effective January 1, 2022 initially in the amount of $4.3 million and it will be renewed annually.  This amount covers the annual amount of Independent Spent Fuel Storage Installation (ISFSI) operation and maintenance costs projected for 2022-2024.  If a settlement is not reached by January 1, 2024, this amount will be increased to $9.3 million, which covers the annual amount of ISFSI operation and maintenance costs projected for years after 2024.


The plant is currently owned by Entergy Nuclear Vermont Yankee (Entergy VY) and operated by Entergy Nuclear Operations (Entergy NO), both of which are listed on the license.  Entergy and NorthStar NDC requested the license transfer by letter dated February 9, 2017.  According to the request, the new owner will be NorthStar VY and the operator in charge of dismantling the plant will be NorthStar NDC.  The transfer includes the plant’s dry cask spent nuclear fuel storage facility.

In particular, the applicants requested the NRC consent to the direct transfer of Entergy NO’s currently licensed authority (licensed operator for decommissioning) to NorthStar NDC.  In addition, the applicants requested the indirect transfer of control (ownership) of Entergy VY’s facility licenses to NorthStar Decommissioning Holdings, LLC (NorthStar DH) and its parents NorthStar Group Services, Inc. (NorthStar GS), LVI Parent Corp. (LVI) and NorthStar Group Holdings, LLC ( NorthStar GH).

The applicants also requested that the NRC consent to the transfer of the licensed possession, maintenance and decommissioning authorities to NorthStar NDC in order to implement expedited decommissioning at Vermont Yankee.  In addition, the applicants requested approval of a conforming amendment to the license pursuant to Title 10 of the Code of Federal Regulations (10 CFR), Part 50.80, “Transfer of licenses,” and 10 CFR 50.90, “Application for amendment of license, construction permit, or early site permit.”

Notice of the application was published at 82 Federal Register 23,845 as dated on May 24, 2017.  The supplemental information letters contained clarifying information, did not expand the application beyond the scope of the original notice and did not affect the applicability of the NRC’s no significant hazards consideration determination.

For additional information, please contact David McIntyre of the U.S. Nuclear Regulatory Commission at (301) 415-8200.

Utah Issues Notice of Rulemaking Actions

On October 1, 2018, Utah Division of Waste Management and Radiation Control published formal notice in the Utah State Bulletin of various actions taken by the Utah Waste Management and Radiation Control Board at its meeting on September 13, 2018.

Proposed Rule Amendments Open for Public Comment

The Board approved the proceeding with formal rulemaking and public comment to add a new section to R315-301 to establish the requirements for conducting a self-inspection of a solid waste management facility.  The comment period ran from October 1-31, 2018.

During the 2018 General Session of the Legislature, H.B. 373, Waste Management Amendments, was enacted and subsequently signed by the governor.  H.B. 373 amended Section 19-6-109 of the Solid and Hazardous Waste Act to allow an owner or operator of a solid waste management facility the option of performing self-inspections of the owner or operator’s facility.  The proposed rule changes set the requirements associated with an owner or operator performing a self-inspection.  The proposed rule changes also incorporate the use of electronic information management, as envisioned by H.B. 373.

Final Adoption of Rule Changes 

The Board approved final adoption of changes to the Used Oil Rules R315-15-16, Grants, to provide additional clarity and more detailed direction to the grant application, issuance, implementation and reimbursement processes.  The effective date of the rule change was September 14, 2018.

The Board also approved final adoption of changes to the Hazardous Waste Rules R315-260, Hazardous Waste Management System, and R315-261, General Requirements – Identification and Listing of Hazardous Waste, to incorporate federal regulatory changes promulgated by the U.S. Environmental Protection Agency (EPA) and published at 83 Federal Register 24,664 on May 30, 2018.  The effective date of the rule change was September 14, 2018.

For additional information on the above rulemaking actions, please visit the Division website at www.deq.utah.gov or the Office of Administrative Rules website at www.rules.utah.gov for the October 1, 2018 issue of the Utah State Bulletin.

For additional information, please contact Don Verbica at (801) 536-0206 or at dverbica@utah.gov or Rusty Lundberg at (801) 536-4257 or at rlundberg@utah.gov.  

Wyoming Becomes NRC’s 38th Agreement State

On September 25, 2018, the U.S. Nuclear Regulatory Commission (NRC) announced that the agency has entered into an agreement with the State of Wyoming to transfer regulatory authority to the state over certain radioactive materials.  With this action, Wyoming becomes the 38th state to sign such an agreement with the NRC.  Wyoming Governor Matthew Mead and NRC Chair Kristine Svinicki signed the agreement in Cheyenne.


With the agreement, the NRC transfers to Wyoming the responsibility for licensing, rulemaking, inspection and enforcement activities necessary to regulate source material involved in uranium or thorium milling and the management and disposal of milling waste, or mill tailings.  Fourteen uranium recovery licenses will be transferred to Wyoming’s jurisdiction.  The NRC retains jurisdiction over any commercial nuclear power plants (there currently are none in Wyoming), federal agencies using certain radioactive materials in the state and uses of radioactive material other than uranium and thorium milling activities.  Before entering into the agreement, the NRC determined that Wyoming’s radiation control program is adequate to protect public health and safety and is compatible with NRC regulations.


Thirty-seven other states have signed similar agreements with the NRC.  They include Alabama, Arizona, Arkansas, California, Colorado, Florida, Georgia, Illinois, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Minnesota, Mississippi, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, Utah, Virginia, Washington and Wisconsin. 

Copies of the agreement, the Governor’s request/supporting documents, public comments and the NRC staff assessment are available on the NRC website at www.nrc.gov.  For additional information, please contact David McIntyre at (301) 415-8200.

National Defense Authorization Act Continues NNSA Program re Voluntary Phasing Out of Cesium Chloride Blood Irradiation Devices

On August 13, 2018, President Donald J. Trump signed the John S. McCain National Defense Authorization Act for Fiscal Year 2019 (Public Law No. 115-232).  Amongst other things, the law directs the Administrator for Nuclear Security to continue working toward the voluntary phasing out of the use of blood irradiation devices in the United States that rely on cesium chloride by December 31, 2027.

The law authorizes the National Nuclear Security Administration (NNSA) to continue its current program to pay up to 50% of the per-device replacement costs and 100% of the disposition costs.  The law includes specified reporting requirements about the program to Congress.

The relevant text is as follows:


(a)  Goal.—The Administrator for Nuclear Security shall ensure that the goal of the covered programs is eliminating the use of blood irradiation devices in the United States that rely on cesium chloride by December 31, 2027.

(b)  Implementation.—To meet the goal specified by subsection (a), the Administrator shall carry out the covered programs in a manner that—

(1) is voluntary for owners of blood irradiation devices;

(2) allows for the United States, subject to the review of the Administrator, to pay up to 50 percent of the per-device cost of replacing blood irradiation devices covered by the programs;

(3) allows for the United States to pay up to 100 percent of the cost of removing and disposing of cesium sources retired from service by the programs; and

(4) replaces such devices with x-ray irradiation devices or other devices approved by the Food and Drug Administration that provide significant threat reduction as compared to cesium chloride irradiators.

(c)  Duration.—The Administrator shall carry out the covered programs until December 31, 2027.

(d)  Report.—Not later than 180 days after the date of the enactment of this Act, the Administrator shall submit to the appropriate congressional committees a report on the covered programs, including—

(1) identification of each cesium chloride blood irradiation device in the United States, including the number, general location, and user type;

(2) a plan for achieving the goal established by subsection (a);

(3) a methodology for prioritizing replacement of such devices that takes into account irradiator age and prior material security initiatives;

(4) in consultation with the Nuclear Regulatory Commission and the Food and Drug Administration, a strategy identifying any legislative, regulatory, or other measures necessary to constrain the introduction of new cesium chloride blood irradiation devices;

(5) identification of the annual funds required to meet the goal established by subsection (a); and

(6) a description of the disposal path for cesium chloride sources under the covered programs.

(e)  Assessment.—The Administrator shall submit an assessment to the appropriate congressional committees by September 20, 2023, of the results of the actions on the covered programs under this section, including—

(1) the number of replacement irradiators under the covered programs;

(2) the life-cycle costs of the programs, including personnel training, maintenance, and replacement costs for new irradiation devices;

(3) the cost-effectiveness of the covered programs;

(4) an analysis of the effectiveness of the new irradiation devices’ technology; and

(5) a forecast of whether the Administrator will meet the goal established in subsection (a).

(f)  Definitions.—In this section:

(1)  APPROPRIATE CONGRESSIONAL COMMITTEES.—The term “appropriate congressional committees” means—

(A) the Committee on Appropriations, the Committee on Armed Services, and the Committee on Energy and Commerce of the House of Representatives; and

(B) the Committee on Appropriations, the Committee on Armed Services, the Committee on Energy and Natural Resources, and the Committee on Health, Education, Labor, and Pensions of the Senate.

(2) COVERED PROGRAMS.—The term “covered programs” means the following programs of the Office of Radiological Security of the National Nuclear Security Administration:

(A) The Cesium Irradiator Replacement Program.

(B) The Off-Site Source Recovery Program.

For additional information, please see the following link to the bill: https://www.congress.gov/bill/115th-congress/house-bill/5515/text#toc-HE367D447CEDB4375A344CBBF76D48202

President Trump to Nominate William Bookless as NNSA Principal Deputy Administrator

On August 10, 2018, President Donald J. Trump announced his intent to nominate William Bookless, a former Senior Physicist at the U.S. Department of Energy (DOE) Lawrence Livermore National Laboratory (LLNL), to be the Principal Deputy Administrator at the National Nuclear Security Administration (NNSA).

Bookless participated in various nuclear security research projects during his 32-year tenure at LLNL.  He worked as the Deputy Associate Director for the laboratory’s Nuclear Weapons Program, as well as the Associate Director for Safety and Environmental Protection.  His LLNL career culminated with a two and a half year assignment as Senior Adviser to the NNSA Administrator from 2009 to 2012.  Before retiring in 2015, Bookless served for three years as the Assistant Laboratory Director for Policy and Planning at the Brookhaven National Laboratory.

Bookless received his Ph.D. in physics from the University of Wyoming in 1980.  He received NNSA recognition for his advisory work on the 2010 Nuclear Posture Review and the New START Treaty.

For additional information, please see www.whitehouse.gov.

Proto-Prompt Decommissioning Planned for Pilgrim and Palisades Sites

On August 1, 2018, an agreement was announced for Entergy Corporation to sell the subsidiaries that own the Pilgrim Nuclear Power Station in Plymouth, Massachusetts and the Palisades Power Plant in Covert, Michigan after their shutdowns and reactor defuelings to a Holtec International subsidiary for accelerated decommissioning.

The sales include the transfer of the licenses, spent fuel, and Nuclear Decommissioning Trusts (NDTs), as well as the site of the decommissioned Big Rock Point Nuclear Power Plant near Charlevoix, Michigan where only the Independent Spent Fuel Storage Installation (ISFSI) remains.  The transactions are subject to conditions to closing, including approvals from the U.S. Nuclear Regulatory Commission (NRC) of the license transfers.


Assuming timely regulatory approvals, Holtec expects to initiate proto-prompt decommissioning of Pilgrim in 2020, with the expectation that all major decommissioning work will be completed in approximately eight years.  A timeline for the decommissioning of Palisades will be developed closer to its shutdown. For both Pilgrim and Palisades, Holtec expects to move all of the spent nuclear fuel out of their spent fuel pools and into dry cask storage within approximately three years after the plants’ respective shutdowns.

In previous announcements, Entergy has stated that it remains committed to the safe and reliable operation of Pilgrim and Palisades until their permanent shutdowns.  By selling these plants for decommissioning, Entergy continues to execute its strategy to exit Entergy Wholesale Commodities and move to a pure play utility.  Entergy is seeking regulatory approvals to sell its subsidiary that owns the shutdown Vermont Yankee site by the end of 2018.

Next Steps

Holtec and Entergy expect to file a license transfer request with the NRC in the fourth quarter of this year for Pilgrim, with transaction closing targeted by the end of 2019.  For Palisades, the license transfer request would take place closer to its planned shutdown in the spring of 2022, with transaction closing expected by the end of that year.

Holtec will utilize Comprehensive Decommissioning International, LLC (CDI), which is a newly-formed U.S.-based joint venture company between Holtec International and SNC-Lavalin to perform the decommissioning, including all required demolition and cleanup.

“Holtec will draw on its own and its partners’ safety commitment and decades of experience and expertise in decommissioning and site remediation to carry out decommissioning, which could benefit the local communities by returning these plant sites (excluding each site’s used fuel storage facility) to productive use at an early date,” states the press release.  “Holtec will transfer all of the used nuclear fuel to its cask systems to be stored at the respective sites which will remain under guard at the sites, monitored during shutdown and decommissioning and subject to the NRC’s oversight, until the U.S. Department of Energy (DOE) removes it in accordance with its legal obligations.”


The Pilgrim Nuclear Power Station is the only nuclear power plant operating in Massachusetts.  It is located in the Manomet section of Plymouth on Cape Cod Bay, south of the tip of Rocky Point and north of Priscilla Beach.  Like many similar plants, it was constructed by Bechtel, and is powered by a General Electric BWR 3 boiling water reactor inside of a Mark 1 pressure suppression type containment and generator.  It has a 690 MW production capacity.  Pilgrim Station produces about 14% of the electricity generated in Massachusetts.  On October 13, 2015, plant owners announced that it would close by June 1, 2019.  Entergy cited “market conditions and increased costs,” which would have included tens of millions of dollars of necessary safety upgrades, as the basis for the decision to close the Pilgrim Station.

The Palisades Nuclear Generating Station is located on Lake Michigan in Van Buren County’s Covert Township, Michigan.  The plant is located on a 432-acre site that is five miles south of South Haven, Michigan. The Westinghouse Electric Company turbine generator can produce 725,000 kilowatts of electricity.  Built between 1967 and 1970, Palisades was approved to operate at full power in 1973.  The plant’s original licensee was due to expire on March 24, 2011.  An application for 20-year extension was filed in 2005 with the NRC.  It was granted on January 18, 2007. Therefore, the plant was then scheduled for decommissioning by 2031.  However, Entergy had made a decision to close the plant in October 2018.  Consumers Energy then attempted to buy its way out of a power purchase agreement it has with Entergy and the plant. The Michigan Public Service Commission (MPSC) did not approve Consumer Energy’s full request of $172 million, however, so Entergy decided to keep the plant open three years longer than planned.  Entergy currently plans to close the Palisades plant in 2022.

For additional information about Holtec International, please see www.holtecinternational.com.  For additional information about CDI, please see www.cdi-decom.com

For additional information about the Pilgrim and Plymouth projects, please contact Erika Grandrimo at (856) 797-0900, ext. 3920 or at e.grandrimo@holtec.com.

High Profile Letter Sent to DOE Secretary Rick Perry re National Security Attributes of U.S. Nuclear Power Plants

By letter dated June 26, 2018, a broad coalition of 75 former government officials, lawmakers and industry leaders — a quarter of whom are retired admirals or vice admirals — expressed concern to U.S. Department of Energy (DOE or Department) Secretary Rick Perry regarding the impact of the premature shutdown of nuclear power plants.

“We urge you to continue to take concrete steps to ensure the national security attributes of U.S. nuclear power plants are properly recognized by policymakers and are valued in U.S. electricity markets,” states the letter.


On June 1, 2018, President Donald Trump requested that DOE take measures to prevent further closures of nuclear power plants due to a national security interest in securing the national power grid’s resilience.  The recent letter appears to support that request, underscoring the key role of nuclear power toward the national security of the United States, particularly as an essential component of electric grid resilience and the largest source of emission-free generation.

Although the letter acknowledges that discussions concerning the general importance of nuclear energy are underway at the Federal Energy Regulatory Commission (FERC), grid operator and state regulator levels, the letter asserts that only DOE has the power to integrate nuclear power into the broader national security imperatives.  While recognizing that such integration will take time to consider, the letter requests that Secretary Perry take steps to ensure that no additional nuclear power plants are closed in the meantime.

In addition to admirals and vice admirals, signatories to the letter include former U.S. Secretary of State George Shultz; former U.S. Senators Byron Dorgan (D-ND), Judd Gregg (R-NH), Trent Lott (R-MS), Jim Talent (R-MO), and John Warner (R-VA); former New Jersey Governor and former U.S. Environmental Protection Agency (EPA) Administrator Christine Todd Whitman; and, many former industry executives including former General Motors’ Chair and Chief Executive Officer (CEO) Daniel Akerson, former AREVA CEO Thomas Christopher, retired Westinghouse Electric Co. and URENCO USA Chair Charles Pryor and former Battelle Memorial Institute President and CEO Jeffrey Wadsworth.  In addition, three former Chairs (Nils Diaz, Dale Klein and Richard Meserve) of the U.S. Nuclear Regulatory Commission (NRC) signed the letter, as well as some former NRC Commissioners and several former Directors of national laboratories.

National Security Benefits

“The national security benefits of a strong domestic nuclear energy sector take many forms,” states the letter, “many of which overlap and together are woven into the nation’s greater strength and resilience.”  The letter continues by citing the following examples:

  • Our nation’s nuclear power plants are among the most robust elements of U.S. critical infrastructure, offering a level of protection against natural and adversarial threats that goes far beyond most other elements of our nation’s electrical grid. The Department of Defense depends on the nation’s grid to power 99 percent of its installations, meaning large scale disruptions affect the nation’s ability to defend itself.
  • Nuclear plants have up to two years’ worth of fuel on site, providing valuable fuel diversity and increasing the resilience of our electrical grid by eliminating the supply vulnerabilities that face some other forms of energy supply.
  • Several national security organizations, including our nuclear Navy and significant parts of the Department of Energy, benefit from a strong civil nuclear sector. Many of the companies that serve the civil nuclear sector also supply the nuclear Navy and major DOE programs.  For example, the Administration’s 2018 Nuclear Posture Review noted that the United States is unable to produce enriched uranium for national security purposes.  Re-establishing this capability will be far easier and more economical with a strong, thriving civil nuclear sector.  Moreover, the nuclear industry is an important career destination for military veterans.
  • Nuclear energy is by far our nation’s largest source of emissions-free generation. Carbon dioxide emissions from other forms of electricity production contribute to changes in our climate, and a changing climate has been identified by the national security community as a national security risk.
  • Competitiveness internationally is inextricably linked to maintaining a strong domestic nuclear program. More than six decades ago, the United States developed what is today the commercial nuclear industry, which established and maintained a leadership role that transcends power generation.  However, we are in jeopardy of losing our edge and missing out on much of a global opportunity estimated at over half a trillion dollars.  Today, there are 56 reactors under construction in the world and this expansion is largely driven by China and Russia.
  • A strong civil nuclear export sector creates deep and long-lasting relationships between the U.S. and partner nations across important areas that advance America’s national security interests, including nonproliferation, nuclear safety, and physical and cyber security. If we do not continue to play a major role in the global market for nuclear reactors, technology and fuel, our influence over nonproliferation and nuclear safety standards will be greatly diminished.


By the end of 2021, twenty-four of the operating nuclear power plants in the United States are either set to close or will no longer be profitable according to a report by Bloomberg New Energy Finance (BNEF) that was issued on May 15, 2018.  In addition, the report cautions that more plants are likely to close.  According to the BNEF study, the industry is increasingly challenged by sluggish power demand, inexpensive natural gas and the rise of renewable energy.  This is especially true in the Midwest, where the use of wind power and other renewable power options are being used increasingly.

In this regard, a February 2018 report from BNER and the Business Council for Sustainable Energy found that renewable power had reached 18 percent of the U.S. electricity generation capacity.  The expansion has been spurred, in part, by an increase in hyrdopower investments in the West.  Nuclear power recently contributed about 20 percent, but that figure is declining as operating facilities continue to shut down.

In addition, DOE is currently weighing a March 2018 request from the competitive power unit at FirstEnergy Corporation to declare that an emergency exists its PJM market.  The PJM Energy Market procures electricity to meet consumer’s demands both in real time and in the near term.  It includes the sale or purchase of energy in PJM’s Real-Time Energy Market (five minutes) and Day-Ahead Market (one day forward).  If Secretary Perry agrees to the request, it would mean the PJM would have to compensate both nuclear and coal generators in the at-risk market in order to protect the stability of the grid.

2019 Hodes Award Nominations Sought

The Southeast Compact Commission for Low-Level Radioactive Waste Management is accepting nominations for the 2019 Richard S. Hodes, M.D. Honor Lecture Award—a program that recognizes an individual, company, or organization that contributed in a significant way to improving the technology, policy, or practices of low-level radioactive waste management in the United States.  The award recipient will present the innovation being recognized at a lecture during the Waste Management ’19 Symposium in Phoenix, Arizona.  The award recipient will receive a $5,000 honorarium and all travel expenses will be paid.

Nominations must be received by August 31, 2018.


The Richard S. Hodes Honor Lecture Award—established in March, 2003—is awarded to an individual, company, or organization that contributed in a significant way to improving the technology, policy, or practices of low-level radioactive waste management in the United States.

The award recipient will be recognized with a special plaque and an invitation to present a lecture about the innovation during the annual international Waste Management Symposium (WM ’19).  The 2019 symposium is sponsored by the University of Arizona and will be held in Phoenix, Arizona in the spring of 2019.

A special time is reserved during the Symposium for the lecture and the award presentation. The Southeast Compact Commission will provide the award recipient a $5,000 honorarium and will pay travel expenses and per diem (in accordance with Commission Travel Policies) for an individual to present the lecture.


The Richard S. Hodes Honor Lecture Award recognizes innovation industry-wide.  The award is not limited to any specific endeavor—contributions may be from any type of work with radioactive materials (nuclear energy, biomedical, research, etc.), or in any facet of that work, such as planning, production, maintenance, administration, or research.  The types of innovations to be considered include, but are not limited to:

  • conception and development of new approaches or practices in the prevention, management, and regulation of radioactive waste;
  • new technologies or practices in the art and science of waste management; and,
  • new educational approaches in the field of waste management.

The criteria for selection include:

  1. Innovation.  Is the improvement unique? Is it a fresh approach to a standard problem? Is it a visionary approach to an anticipated problem?
  2. Safety.  Does the practice enhance radiation protection?
  3. Economics.  Does the approach produce significant cost savings to government, industry or the public?
  4. Transferability.  Is this new practice applicable in other settings and can it be replicated?  Does it increase the body of technical knowledge across the industry?


To be eligible for the award, the individual/group must consent to being nominated and must be willing to prepare and present a lecture about the innovation being recognized at the Waste Management Symposium.  Individuals or organizations can nominate themselves or another individual, company, institution, or organization.


To nominate yourself or another individual, company, or organization for this distinguished award, please contact:

Awards Committee
c/o Ted Buckner

Executive Director
Southeast Compact Commission
Post Office Box 5427
Cary, NC 27512
(919) 380-7780

(919) 380-7710 – FAX

or visit the Southeast Compact Commission’s website at http://www.secompact.org/.

Nominations must be received by August 31, 2018.

Toshiba Withdraws from Two Planned South Texas Project Reactors

On June 7, 2018, Toshiba America Nuclear Energy Corporation — a U.S. wholly owned subsidiary of Japan’s Toshiba Corporation — announced plans to withdraw from a project to build two additional advanced boiling water reactor units at the South Texas Project (STP) site in Matagorda County, Texas.

According to news reports and a company press release, Toshiba officials scrapped their involvement in the estimated $15 million project due to a lack of investors.


According to a press release from Toshiba, company officials plan to cancel all contracts related to Nuclear Innovation North America (NINA), which was established by an agreement with NRG Energy Inc. in 2008 for the purpose of building the two additional STP units.  The corporation will also cancel an engineering, procurement and construction contract it signed in 2009 with STP, as well as canceling deferred loans and forgiving loans under loan contracts.

“Under current and expected economic conditions, further development of STP Units 3 and 4 has ceased to be financially viable,” stated a press release from Toshiba.  “In these circumstances, there is no clear pathway to securing profitability.”

Tim Powell, President and CEO of STP, stated in the release that a meeting of NINA’s Board of Directors is expected in the coming weeks to determine the future of STP Units 3 and 4.  “While the further development of Units 3 and 4 are in question, I want to assure you that the safe and reliable operation of Units 1 and 2 remains the commitment of each and every employee at STP,” stated Powell.  “These units continue to be vital to the resilience and reliability of the Texas grid and we are focused on maintaining the exemplary performance we have achieved and creating further value for the community we call home.”

“With our recently granted 20-year life extension for Units 1 and 2, that mission will continue today, tomorrow and for many years to come,” continued Powell.  “STP remains a proud partner of Matagorda County and the South Texas region for over 30 years and will remain so as we continue to move forward.”

According to the release, Toshiba officials intend to meet with the NINA Board of Directors and continue the necessary withdrawal procedures with NRG.  The release states that the corporation will have completely withdrawn from the project by the end of the year.

Combined License

In February 2016, the U.S. Nuclear Regulatory Commission (NRC) issued two Combined Licenses (COL) for the STP site in Texas.  Based on the mandatory hearing on NINA’s application, the Commission found the staff’s review adequate to make the necessary regulatory safety and environmental findings.

NRC staff imposed several conditions on the license, including:

  •   specific actions associated with the agency’s post-Fukushima requirements for Mitigation Strategies and Spent Fuel Pool Instrumentation;
  •   requiring monitoring and analysis of the reactors’ steam dryers during initial plant startup, in line with current procedures for existing boiling-water reactors approved to operate at increased power levels; and,
  •   setting a pre-startup schedule for post-Fukushima aspects of the new reactor’s emergency preparedness plans and procedures.


  • The NRC certified the 1,300-megawatt ABWR design in 1997. On September 20, 2007, NINA submitted its application for the licenses.
  • The NRC’s Advisory Committee on Reactor Safeguards (ACRS) independently reviewed aspects of the application that concern safety, as well as the staff’s Final Safety Evaluation Report (FSER). The ACRS, a group of experienced technical experts, advises the Commission—independently from the NRC staff—on safety issues related to the licensing and operation of nuclear power plants, as well as on issues of health physics and radiation protection.
  • The NRC completed its environmental review and issued the Final Environmental Impact Statement (FEIS) for the proposed STP reactors in February 2011. Four years later, on February 19, 2015, the ACRS provided the results of its review to the Commission. The NRC completed and issued the FSER on September 29, 2015.

STP’s two units produce 2,700 megawatts of carbon-free electricity — providing clean energy to 2 million Texas homes.  According to STP officials, Units 3 and 4 would have doubled that production output and could have created about 800 additional jobs.

Additional information on the certification process is available on the NRC web site at nrc.gov. For additional information, please contact Scott Burnell of the NRC at (301) 415-8200.

NRC Issues Construction Permit to Northwest Medical Isotopes LLC

On May 9, 2017, NRC announced that agency staff has issued a construction permit to Northwest Medical Isotopes LLC (NWMI) for a molybdenum-99 production facility in Columbia, Missouri.  The permit is for a site at the Discovery Ridge Research Park.


The Commissioners authorized the Director of the NRC’s Office of Nuclear Reactor Regulation to issue the permit following a hearing on the application on January 23, 2018.  The Commission found the staff’s review of the application sufficient to make the necessary regulatory safety and environmental findings.

NWMI submitted its application for permission to build the facility in two parts on February 5, 2015 and July 20, 2015.  It will produce molybdenum-99, which later generates the technicium-99m that is used in one of the most common nuclear medicine procedures in the United States.


The NRC’s Advisory Committee on Reactor Safeguards (ACRS) independently reviewed aspects of the application that concerned safety, as well as the staff’s safety evaluation report.  The committee provided the results of its review to the Commission in November 2017.

The staff completed its environmental review and issued the final environmental impact statement for the proposed facility in May 2017.

For additional information, please contact Scott Burnell of the NRC at (301) 415-8200.

Senate Approves All Three Nominees for NRC Commissioners

On May 24, 2018, by a voice vote during an evening session, the U.S. Senate approved en banc the confirmations of all three outstanding nominees to the U.S. Nuclear Regulatory Commission (NRC) including:

  • Annie Caputo, a nuclear policy adviser to Senate Environment and Public Works Committee Chairman John Barrasso (R-WY);
  • David Wright, an energy consultant and former president of the National Association of Regulatory Utility Commissioners; and,
  • Jeff Baran, an attorney and member of the Commission since 2014 who’s current term is scheduled to expire on June 30, 2017.

Shortly before the confirmations’ vote, the Senate Appropriations Committee approved a budget proposal that provided no money for the proposed Yucca Mountain radioactive waste repository in Nevada.  Caputo and Wright were sworn-in as new NRC Commissioners the following week.


Five Commissioners appointed by the President and confirmed by the Senate for five-year terms head the NRC.  One of them is designated by the President to be the Chair and official spokesperson of the Commission.  The Chair is the Principal Executive Officer of and the Official Spokesperson for the NRC.  As Principal Executive Officer, the Chair is responsible for conducting the administrative, organizational, long-range planning, budgetary and certain personnel functions of the agency.  The Chair has ultimate authority for all NRC functions pertaining to an emergency involving an NRC license.  The Chair’s actions are governed by the general policies of the Commission.

The Commission operates as a collegial body to formulate policies, develop regulations governing nuclear reactor and nuclear material safety, issue orders to licensees, and adjudicate legal matters.  The Commission is currently comprised of Chair Kristine Svinicki, Commissioner Jeff Baran and Commissioner Stephen Burns.

For additional information related to Commission business, please contact Annette Vietti-Cook, Secretary of the Commission, at (301) 415-1969 or at NRCExecSec@nrc.gov.

DOE Plans to Move Forward with Key WIPP Infrastructure Upgrade

On May 14, 2018, the Office of Environmental Management (EM) at the U.S. Department of Energy (DOE) announced plans to move forward with a key infrastructure upgrade at the Waste Isolation Pilot Plant (WIPP) in New Mexico.  According to the announcement, the upgrade will enable increased progress in DOE’s mission to address the environmental legacy of decades of nuclear weapons production and government-sponsored nuclear energy research.

Assistant Energy Secretary for Environmental Management Anne White approved the start of construction for the $288 million underground ventilation system.  The Safety Significant Confinement Ventilation System (SSCVS) will be key to DOE’s plans to increase shipments of transuranic waste to WIPP from cleanup sites across the DOE complex.

“This will be a significant improvement for WIPP in support of its critical role in our national mission,” said White.  “I am appreciative of the unwavering support from our local, state and federal elected officials and stakeholders at WIPP who have helped to ensure we have proper funding to make infrastructure improvements, like the new ventilation system.”

According to EM, the SSCVS will significantly increase the amount of air available to the underground portion of the WIPP facility.  As a result, DOE will be able to perform transuranic waste emplacement activities simultaneously with facility mining and maintenance operations.  The new ventilation system will also allow for easier replacement and preventative maintenance activities.  EM expects construction of the new ventilation system to be completed by early 2021.

The new ventilation system is one of a number of infrastructure projects planned for WIPP in the coming years to enable the facility to continue to play an integral role in DOE’s cleanup program.  To date, more than 90,000 cubic meters of transuranic waste have been disposed of at WIPP.

NRC Announces Senior Management Selections

On May 3, 2018, the U.S. Nuclear Regulatory Commission (NRC) announced the following senior management selections in the Office of New Reactors (NRO), the Office Nuclear Regulatory Research (RES), the Office of Nuclear Reactor Regulation (NRR) and the Office of Commission Appellate Adjudication (OCAA):

  •   Office of New Reactors:  Frederick Brown will become Director of NRO, effective immediately.  Brown, whose permanent position was Deputy Executive Director for Materials, Waste, Research, State, Tribal, Compliance, Administration, and Human Capital Programs, has been serving as the NRO Acting Director.  He joined the NRC in 1994, working in Region III, having served in both resident and senior resident inspector positions.  After joining the Senior Executive Service (SES), Brown held positions in NRO and NRR, including Director of the Division of Inspection and Regional Support. He worked in Region II as the Deputy Regional Administrator for Construction and has worked in various SES positions in the Office of the Executive Director for Operations and the Office of the Chief Information Officer.  Before joining the NRC, Brown worked as an engineer, supervisor, and manager at California’s Mare Island Naval Shipyard.  He holds a Bachelor of Science degree, with a double major from the United States Merchant Marine Academy at Kings Point, New York.
  •   Office of Nuclear Regulatory Research:  Effective July 3, 2018, Raymond Furstenau will become Director of RES, following the retirement of Mike Weber.  Furstenau will transition to the NRC later this month from his current SES position at the U.S. Department of Energy (DOE), where he serves as Associate Principal Deputy Assistant Secretary and Central Technical Authority of the Office of Nuclear Energy.  He has previously served as the Chief of Nuclear Safety for the Under Secretary of Energy.  Prior to his senior leadership positions at DOE, Furstenau worked in various roles at the DOE Idaho Operations Office for more than 25 years, providing federal oversight of nuclear energy and national security research programs and safety oversight of nuclear facility operations at the Idaho National Laboratory.  He also served in the military on active duty as an officer in the Army Finance Corps and in the Army Reserve.  Furstenau holds a Bachelor of Science degree in Applied Science and Engineering from the U.S. Military Academy and a Master of Science degree in Nuclear Science and Engineering from Idaho State University.
  •   Office of Nuclear Reactor Regulation:  Ho Nieh will become Director of NRR in August.  Nieh, a member of the SES, will return to the NRC this summer from the Organisation for Economic Cooperation and Development, where he serves as the Director of the Division of Nuclear Safety Technology and Regulation at the Nuclear Energy Agency.  He began his NRC career in 1997 as an engineer in Region I, joining the agency after serving in various engineering positions at the Knolls Atomic Power Laboratory.  At the NRC, Nieh worked as a resident and senior resident inspector before joining the newly created Office of Nuclear Security and Incident Response in 2003.  He has also served in various management positions in NRR, including as Director of the Division of Inspection and Regional Support, as well as Director of the Division of Reactor Projects.  Additionally, Nieh was assigned to the International Atomic Energy Agency (IAEA), Department of Nuclear Safety and Security.  He also served as Chief of Staff to NRC Commissioner Bill Ostendorff.  He graduated from the U.S. Naval Nuclear Power School and holds a Bachelor of Engineering in Marine Engineering from the State University of New York Maritime College and a Master of Business Administration from Johns Hopkins University.
  •   Office of Commission Appellate Adjudication:  Effective June 24, 2018, Catherine Scott will become Director of OCAA.  She most recently served in the Office of the General Counsel (OGC) in the position of Assistant General Counsel for Operating Reactors from 2016 to the present and for Materials Litigation and Enforcement from 2008 to 2016.  She was appointed to the Committee to Review Generic Requirements in 2017.  Scott also served as a legal assistant to NRC Commissioner Peter Lyons from 2005 to 2008.  In 2001, she was assigned a detail position to the Committee on Energy and Commerce in the U.S. House of Representatives.  Scott began her career as an attorney in the Reactor Programs division in OGC.  She is a graduate of Boston University and Suffolk University Law School.

For additional information, please contact the NRC Office of Public Affairs at (301) 415-8200.

Low-Level Radioactive Waste Forum Establishes New Working Group

Will Address NRC Activities, Initiatives and Rulemakings

During the spring 2018 meeting of the Low-Level Radioactive Waste Forum (LLW Forum) in California, the organization’s Board of Directors passed a resolution to establish a new working group.

The purpose of the new working group is to review, consider and provide timely input and feedback from the states and low-level radioactive waste compact commissions on activities, initiatives and rulemakings of the U.S. Nuclear Regulatory Commission (NRC).

The text of the resolution, as approved by vote of the LLW Forum Board of Directors, is as follows:

As the U.S. Nuclear Regulatory Commission (NRC) has several significant activities, initiatives and rulemakings ongoing related to the management and disposition of low-level radioactive waste including, but not limited to:

  • completion of work on a final rule to amend Title 10 of the Code of Federal Regulations (10 CFR) Parts 20, “Standards for Protection Against Radiation,” and Part 61, “Licensing Requirements for Land Disposal of Radioactive Waste;”
  • outreach regarding proposed revisions to its guidance document for alternative disposal requests entitled, “Guidance for the Reviews of Proposed Disposal Procedures and Transfers of Radioactive Material Under 10 CFR 20.2002 and 10 CFR 40.13(a);”
  • preparation for a very low-level radioactive waste (VLLW) scoping study to identify possible options to improve and strengthen the NRC’s regulatory framework for the disposal of the anticipated large volumes of VLLW associated with the decommissioning of nuclear power plants and material sites, as well as waste that might be generated by alternative waste streams that may be created by operating reprocessing facilities or a radiological event;
  • publication of a draft regulatory basis for proposed new regulations on the decommissioning of commercial nuclear power reactors;

As various additional NRC activities, initiatives and rulemakings are planned upon the completion of the 10 CFR Part 61 rulemaking including, but not limited to:

  • drafting of proposed changes to 10 CFR Part 20 Appendix G and NUREG/BR-0204, which require that an NRC Uniform Waste Manifest (UWM) be prepared for waste intended for ultimate disposal at a licensed low-level radioactive waste land disposal facility;
  • consideration of a potential rulemaking on waste classification tables; and,
  • development of a regulatory basis for the disposal of Greater-than-Class C (GTCC) and transuranic waste through means other than a deep geologic disposal, including near surface disposal;

As the NRC is seeking and will continue to seek input from interested stakeholders on the above-referenced and initiatives and rulemakings and other activities related to the management and disposition of low-level radioactive waste;

As all currently operating low-level radioactive waste disposal facilities are regulated by the states in which they are located pursuant to agreements with the NRC;

As the Low-Level Radioactive Waste Forum (LLW Forum) is comprised of designated officials to represent the views and perspectives of states and low-level radioactive waste compact commissions on issues related to the management and disposition of low-level radioactive waste;

As the Low-Level Radioactive Waste Policy Act of 1980 and its 1985 amendments provides that the federal government will provide technical assistance to the states and low-level radioactive waste compact commissions;

As, during a March 2017 meeting, the then-Acting Assistant Secretary for Environmental Management at the U.S. Department of Energy (DOE) informed the LLW Forum that DOE would be reducing its funding to the LLW Forum in FY 2017 by 26% and that other federal agencies need to more equitably participate in future cost-sharing toward this program;

As, in March 2018, DOE notified the LLW Forum of an additional 50% cut in the remaining grant funding allocation for FY 2018;

As, at the fall 2011 LLW Forum meeting, the then-Director of NRC’s Division of Waste Management and Environmental Protection in the Office of Federal & State Materials & Environmental Management Programs specifically requested that the states and low-level radioactive waste compact commissions provide greater input and feedback on NRC activities, initiatives and rulemakings;

As, through the LLW Forum, the states and low-level radioactive waste compact commissions have created working groups to develop and submit input on a variety of NRC activities, initiatives and rulemakings including, but not limited to, the Branch Technical Position on Concentration Averaging and Encapsulation (CA BTP), 10 CFR Part 61 rulemaking, security and accountability of Category 3 radioactive sources and devices, and financial assurance regulations for radioactive byproduct material;

As, these LLW Forum-organized working groups have provided significant benefit and cost efficiencies to the NRC including having the states and low-level radioactive waste compacts resolve, where possible, conflicts and different perspectives prior to the submittal of input on NRC activities, initiatives and rulemakings;

Now Wherefore Be it Resolved that the LLW Forum hereby creates a working group that will review, consider and provide timely input and feedback from the states and low-level radioactive waste compact commissions on NRC activities, initiatives and rulemakings to the extent that financial resources are available;

Now Wherefore Be it Further Resolved that the LLW Forum will submit an unsolicited application for financial assistance to the NRC to fund the activities of the working group pursuant to NRC Management Directive 11.6, Financial Assistance Program, and in line with direction from the DOE for more equitable cost sharing and from NRC for increased comment from the states and low-level radioactive waste compact commissions on NRC activities, initiatives and rulemakings;

Now Wherefore Be it Further Resolved that the LLW Forum Chair, in consultation with the LLW Forum Executive Committee, will be empowered to designate state and compact representatives to participate on the working group;

Now Wherefore Be it Further Resolved that the working group may seek input from other stakeholders including, but not limited to, other federal agencies, waste disposal facility operators, brokers and processors, industry organizations, generators and users of radioactive materials.


The spring 2018 LLW Forum meeting was held at the Hyatt Regency Airport Hotel in San Francisco, California on April 16-17, 2018.

The Southwestern Low-Level Radioactive Waste Compact Commission co-sponsored the meeting.

If you have questions or require additional information, please contact Todd D. Lovinger, Esq. — Executive Director of the LLW Forum and Project Director of the Disused Sources and Part 61 Working Groups (DSWG/P61WG) — at (754) 779-7551 or at LLWForumInc@aol.com

FirstEnergy Solutions Declares Bankruptcy and Plant Closing Dates

On March 31, 2018, FirstEnergy Solutions — the parent of First Energy Nuclear Operating Company — filed for bankruptcy protection.  As part of its restructuring plan, the company noted that it intended to close three nuclear power plants.

According to published news reports, FirstEnergy Chief Executive Officer and President Charles E. Jones stated as follows:   “FirstEnergy will remain focused on creating long-term value for its customers, employees and shareholders.  Simply put, we will be better positioned to deliver on the tremendous opportunities for customer-focused growth.”

Plant Closings

The company plans to retreat from its role as an energy generating company.  In this regard, FirstEnergy Solutions intends to close the following plants:

  •  the Davis Besse nuclear plant in Oak Harbor, Ohio by 2020;
  • the two-unit Beaver Valley Power Plant in Shipingport, Pennsylvania by 2021; and,
  •  the Perry Nuclear Power Plant in Perry, Ohio, in 2021.

The company said the closings were a milestone in its path towards redefining itself as a utility and not a power producer.

DOE Filing

Pursuant to the Federal Power Act law, FirstEnergy Solutions has also requested that the U.S. Department of Energy (DOE) declare that an emergency exists its PJM market.  The PJM Energy Market procures electricity to meet consumer’s demands both in real time and in the near term.  It includes the sale or purchase of energy in PJM’s Real-Time Energy Market (five minutes) and Day-Ahead Market (one day forward).

If DOE Secretary Rick Perry agrees to the request, it would mean the PJM would have to compensate both nuclear and coal generators in the at-risk market in order to protect the stability of the grid.

Anne White Sworn in as Assistant Secretary for Environmental Management

On March 29, 2018, Anne Marie White of Michigan was sworn in as Assistant Secretary for Environmental Management (EM) at the U.S. Department of Energy (DOE).

“As Assistant Secretary, White will provide leadership to continue the safe cleanup of the environmental legacy brought about from five decades of nuclear weapons development and government-sponsored nuclear energy research,” states the DOE press release announcing the swearing in.  “She will work closely with communities that have partnered with DOE and its predecessor agencies for many decades.”

“It is an honor to serve as Assistant Secretary of Energy for EM,” White said.  “I look forward to the challenges ahead and know that with the talented federal staff, our dedicated workers in the field, and the support of a wide array of stakeholders, we will deliver the EM mission safely and cost effectively.”


White is the founder of Bastet Technical Services, LLC — a consulting firm that has been engaged in providing strategic solutions to solve complex environmental challenges across the DOE complex.  She has more than 25 years of experience across a broad range of activities within the nuclear field, mainly focused on project and program management projects with complex technical, regulatory, and stakeholder challenges.

“She has industry-recognized credentials in technical skills that lead to sound, technically underpinned, cost effective solutions,” stated an earlier announcement.  “She has extensive hands on in the field experience at many of the Environmental Management sites for which she will have responsibility.”

White, who has supported a number of emerging nuclear power nations to develop legal and regulatory structures and national policies, received a Master’s Degree of Science in Nuclear Engineering from the University of Missouri-Columbia.


On January 3, 2018, the White House announced President Donald J. Trump’s intent to nominate White to be the EM Assistant Secretary.  On March 22, 2018, White was confirmed for the position by voice vote of the U.S. Senate.

Since June 2017, James Owendoff has been serving as the Acting EM-1 Assistant Secretary.  In this role, Owendoff has focused on more timely decisions on cleanup projects.

The position was previously held by Monica Regalbuto at the end of the administration of former-President Barack Obama.

For additional information, please contact Douglas Tonkay, Director of the U.S. Department of Energy’s Office of Disposal, at (301) 903-7212 or at Douglas.Tonkay@em.doe.gov or go to www.energy.gov.

NRC Issues Annual Assessments for Nation’s Nuclear Plants

On March 5, 2018, the U.S. Nuclear Regulatory Commission (NRC) announced that the agency has issued annual letters to the nation’s 99 commercial nuclear power plants operating in 2017 regarding their operational performance throughout the year.  All but three plants were in the two highest performance categories.


Of the 96 highest-performing reactors, 83 met all safety and security performance objectives and were inspected by the NRC using the standard “baseline” inspection program.

The NRC determined that 13 reactors needed resolution of one or two items of low safety significance.  For this performance level, regulatory oversight includes additional inspections and follow-up of corrective actions.  Plants in this level include: Browns Ferry 1, 2 and 3 (Alabama); Catawba 2 (South Carolina); Clinton (Illinois); Columbia (Washington); Diablo Canyon 2 (California); Fermi 2 (Michigan); Grand Gulf (Mississippi); Perry (Ohio); Sequoyah 1 and 2 (Tennessee); and, Wolf Creek (Kansas).  Diablo Canyon 2 and Fermi 2 have resolved their findings since the reporting period ended and have transitioned to the highest performing level.

There were no reactors in the third performance category with a degraded level of performance. The NRC noted that there were three reactors in the fourth performance category.  Arkansas Nuclear One 1 and 2 require increased oversight because of two safety findings of substantial significance.  Pilgrim (Massachusetts) is in the fourth performance category because of long-standing issues of low-to-moderate safety significance.  Additional inspections will be conducted to confirm that the performance issues are being addressed.

Next Steps

Later this spring and summer, the NRC will host a public meeting or other event near each plant to discuss the details of the annual assessments.  A separate announcement will be issued for each public assessment meeting.  In addition to the annual assessment letters, plants also receive an NRC inspection plan for the coming year.


Information on the NRC’s oversight of commercial nuclear power plants is available through the NRC’s webpage on the Reactor Oversight Process.  The NRC routinely updates information on each plant’s current performance and posts the latest information as it becomes available to the action matrix summary.  To see the 2017 assessment letters, click on “2017q4” for each plant.  Annual construction oversight assessments for new reactors at the Vogtle Unit 3 and 4 sites are also on the NRC website.

For additional information, please contact the NRC’s Office of Public Affairs at (301) 415-8200.

State of Texas Reduces Disposal Surcharges

In late 2017, the State of Texas agreed to reduce disposal surcharges for a 24-month limited period of time at the Waste Control Specialists (WCS) facilities in Andrews County, Texas.  In particular, gross revenue fees for in-compact customers have been cut in half—reduced from a total of 10% to 5%.  Gross revenue fees for out-of-compact customers have been reduced from 31.25% to 16.25%.

WCS released the following statement regarding reduced disposal surcharges:

Waste Control Specialists is delighted to inform customers that — for a limited time — the state has significantly reduced its disposal surcharges for those customers currently disposing low-level radioactive waste at the WCS facilities in Andrews County.  For both in-compact and out-of-compact generators, this will result in significant cost savings … 

These are significant reductions and already resulting in dramatic cost-savings for our customers.  This should encourage our customers to dispose of low-level radioactive waste in our state-of-the-art facility in Andrews County and we are already seeing an uptick in scheduled disposal shipments …

The new fee structure, which was passed by the Texas Legislature in 2017 and is now in effect, will remain in place through August 31, 2019.  According to WCS, “waste will be taken on a first-come, first-served basis” during the reduced surcharge period.  It is unclear as to what will happen at the end of the 24-month window of cost savings.

For additional information, please contact WCS representative Chuck McDonald at (512) 658-5958 or at chuck@mcdonaldpr.com.

Utah DWMRC Notifies Stakeholders of Rulemaking Actions

On November 3, 2017, the Utah Division of Waste Management and Radiation Control (DWMRC) notified interested stakeholders of the following rulemaking actions that were taken by the Waste Management and Radiation Control Board at its meeting on October 12, 2017:

  1. Final adoption of rule changes to incorporate the following in to Title 313 of the Utah Administrative Code and set an effective date of October 13, 2017:
  •  U.S. Nuclear Regulatory Commission (NRC) final rule published in the May 29, 2013 Federal Register (78 Federal Register 32310) under the title of Distribution of Source Material to Exempt Persons and to General Licensees and Revision of General License and Exemptions.
  • Selected corrections and clarifications not associated with the above final rule.


  1. Approval to proceed with formal rulemaking and public comment with the following proposed changes to R313-25, License Requirements for Land Disposal of Radioactive Waste – General Provisions, of the Utah Administrative Code:
  •   Proposed amendments to R313-25 to incorporate the rule changes required by S.B. 79 (2017 General Session) to the financial assurance requirements for a radioactive waste disposal facility.  Additional changes to the financial assurance requirements are being made for added detail to the Director’s review of and action on the financial assurance cost estimate submitted by a licensee of a radioactive waste disposal facility.


Additional information on the proposed changes to the radiation control rules can be found on the Division website or via the Office of Administrative Rules website for the November 1, 2017 issue (Vol. 2017, No. 21) of the Utah State Bulletin.

 For additional information, please contact Otis Willoughby of the Utah DWMRC at (801) 536-0200.

Modifications Issued re EnergySolutions’ Clive Facility License

On November 2, 2017, EnergySolutions provided notification of the approval of modifications to the Part B Permit issued by the State of Utah for the company’s Clive facility in Tooele County, Utah.  The modifications involved the following changes:

  • 2017-006477: Approval of a Class 1 modification to Revisions to Attachment II-7-1, Overall Facility Closure Cost Summary
  • 2017-006478: Approval of a Class 1 modification to Revisions to Attachment II-7-2, Closure Cost Estimate
  • 2017-006479: Approval of a Class 1 modification to Revisions to Module II, General Facility Conditions, Revision Date List

The above modifications are all related to the 2016 Annual Surety Review modification that was initially submitted on May 23, 2017.

On October 20, 2017, EnergySolutions provided notification of the approval of a modification to the Part B Permit issued by the State of Utah for the company’s Clive facility in Tooele County, Utah.  The modification involved the following changes:

  • 2017-007164: Approval of a Class 1 modification to Revisions to Attachment II-7-1, Overall Facility Closure Cost Summary

Questions regarding these modifications or requests for review of the modification applications and related documents may be directed to EnergySolutions or the Utah Division of Waste Management and Radiation Control (DWMRC).

For additional information, please contact Otis Willoughby of the Utah DWMRC at (801) 536-0200 or Tim Orton of EnergySolutions at (801) 649-2000.

NYSERDA Seeks Project Manager for WVDP

The New York State Energy Research and Development Authority (NYSERDA) West Valley Site Management Program (WVSMP) is seeking an experienced technical professional to join NYSERDA’s team at the Western New York Nuclear Service Center in northern Cattaraugus County, New York.

This individual will be responsible for supporting NYSERDA’s participation in the U.S. Department of Energy (DOE) West Valley Demonstration Project (WVDP), a joint federal-state decommissioning and radioactive waste cleanup project.  This position reports to NYSERDA’s WVDP and End-State Planning Program Manager and will involve on-site observation, monitoring, inspection and oversight of WVDP work activities.


The Project Manager’s primary responsibilities will be to:

  • provide direct observation, inspection, monitoring, oversight and reporting of WVDP work activities, including (but limited to) facility demolition activities, soil excavation and waste packaging;
  • provide subject matter expert reviews of plans, procedures, work packages and radiological and chemical safety work control documents for decommissioning, deactivation and demolition activities;
  • prepare written reports and otherwise keep management fully apprised of WVDP activities, including contractor performance related to safety, regulatory compliance, cost and schedule;
  • prepare MS-Project or Primavera P6 schedules and assist other staff in the preparation of integrated project schedules;
  • represent NYSERDA at meetings with DOE, the site contractor, regulatory agencies, members of the public and other stakeholders;
  • contribute to a positive team environment, a culture of excellence and creative problem solving; and,
  • perform other responsibilities as assigned.


Required minimum qualifications an individual must possess include:

  • a Bachelor’s or Master’s degree in engineering, health physics or industrial safety plus 5 years of relevant experience (i.e., work at the WVDP or a similar nuclear facility, including decommissioning experience, radioactive material management or radioactive waste management) or an unrelated Bachelor’s or Master’s degree plus 7 years relevant experience (work at the WVDP or a similar nuclear facility, including decommissioning experience, radioactive material management or radioactive waste management);
  • strong analytical skills including a demonstrated ability to effectively organize and evaluate quantitative information, draw conclusions and make recommendations or decisions;
  • strong organizational, planning and scheduling abilities with demonstrated proficiency in MS-Project or Primavera P6;
  • strong work ethic and resolute integrity;
  • strong written and verbal communication abilities and interpersonal skills;
  • knowledge of U.S. Nuclear Regulatory Commission (NRC) regulations or DOE Orders and policies; and,
  • ability to work effectively outdoors in inclement weather conditions and safely negotiate unpaved walking surfaces, moderately steep slopes and uneven terrain.


 Candidates will be considered for Project Manager through Senior Project Manager based on qualifications and experience.  An excellent benefits package is also offered. 


In order to apply for the open position, please submit a cover letter and resume to recruiter@nyserda.ny.gov.  When applying, please include Project Manager, WVDP and Job Code 473 in the Subject Line.

For additional information, please contact Alyse Peterson, Senior Project Manager for Radiactive Waste Policy & Nuclear Coordination, NYSERDA, at (518) 862-1090 ext. 3274 or at alp@nyserda.ny.gov.

NRC To Review Its Administrative Regulations

On August 11, 2017, the U.S. Nuclear Regulatory Commission (NRC) announced plans to initiate a retrospective review of its administrative regulations to identify those that are outdated or duplicative.  The review is scheduled to begin in the fall of 2017.

Overview  Any regulations that are identified during the review will be evaluated to determine if they can be eliminated without impacting the agency’s safety and security mission.  NRC anticipates that the review will result in improvements with regard to how applicants and licensees submit information, keep records, and report to the agency.

Process  NRC plans to develop a strategy to accomplish its retrospective review and will seek input from stakeholders through public meetings and a Federal Register notice.  In particular, the NRC plans to encourage its staff, its applicants, licensees and the public to provide input.

Background  Efficiency is one of five NRC principles of good regulation.  The retrospective review is an effort to improve the management and administration of regulatory activities and to ensure that the agency’s regulations remain current, appropriate, and effective.

For additional information, please contact the NRC’s Office of Public Affairs at (301) 415-8200.

SCE&G to Cease New V.C. Summer Nuclear Project

On July 31, 2017, South Carolina Electric & Gas Company (SCE&G) announced that it would cease construction of two new nuclear reactors at the V.C. Summer Nuclear Station in Jenkinsville, South Carolina.  SCE&G, which is a principal subsidiary of SCANA Corporation (SCANA), further announced that the company intends to promptly file a petition with the Public Service Commission of South Carolina seeking approval of its abandonment plan.

According to the company’s press release, this decision was reached by SCE&G after considering the additional costs to complete the new nuclear reactors, the uncertainty regarding the availability of production tax credits for the project and the amount of anticipated guaranty settlement payments from Toshiba Corporation (Toshiba).  SCE&G’s decision was also influenced by other matters associated with continuing construction including the decision of the co-owner of the project, the South Carolina Public Service Authority (Santee Cooper), the state owned electric utility, to suspend construction of the project.

Based on these factors, SCE&G concluded that it would not be in the best interest of its customers and other stakeholders to continue construction of the project.

Overview and Analysis  Following the bankruptcy filing of Westinghouse Electric Company, LLC (WEC), SCE&G and Santee Cooper each began a comprehensive process of evaluating the most prudent path forward for the new nuclear reactors.  The project owners worked with WEC and Fluor Corporation, as well as other technical and industry experts, to evaluate the project costs and schedules.

Based on this evaluation and analysis, SCE&G concluded that completion of both new nuclear reactors would be prohibitively expensive.  According to SCE&G’s analysis, the additional cost to complete both reactors beyond the amounts payable in connection with the engineering, procurement, and construction contract would materially exceed prior WEC estimates, as well as the anticipated guaranty settlement payments from Toshiba.  Moreover, in order to qualify for production tax credits under current tax rules, the new reactors would need to be online before January 1, 2021.  SCE&G’s analysis concluded that the new reactors could not be brought online until after this date.

SCE&G also considered the feasibility of completing the construction of Unit 2 and abandoning Unit 3 under the existing ownership structure and using natural gas generation to fulfill any remaining generation needs.  This option provided a potentially achievable path forward that may have delivered SCE&G a similar megawatt capacity as its 55% interest in the two reactors and provided a long-term hedge against carbon legislation/regulation and against gas price volatility.  SCE&G had not reached a final decision regarding this alternative when Santee Cooper determined that it would be unwilling to proceed with continued construction.  Consequently, SCE&G determined that it is not in the best interest of customers and other stakeholders for it to continue construction of one reactor.

Based on the evaluation and analysis, and Santee Cooper’s decision, SCE&G has concluded that the only remaining prudent course of action will be to abandon the construction of both Unit 2 and Unit 3 under the terms of the Base Load Review Act (BLRA).  Accordingly, normal construction activities at the site will cease immediately and efforts will be shifted toward an orderly transition of winding down and securing the project property.  SCE&G plans to use the anticipated payments resulting from the settlement of Toshiba’s guaranty to mitigate cost impacts to SCE&G electric customers.

Abandonment Proceeding  On August 1, 2017, SCE&G will fully brief the Public Service Commission of South Carolina and thereafter initiate the abandonment proceeding.  In accordance with the BLRA, SCE&G intends to seek an amortization of the project costs and a return at the weighted average cost of capital on the unamortized balance until fully recovered. SCE&G plans to use the anticipated proceeds from the Toshiba settlement and benefits derived from tax deductions to mitigate rate increases and lessen the impact on its customers for several years.

Background  SCANA Corporation—which is headquartered in Cayce, South Carolina—is an energy-based holding company principally engaged, through subsidiaries, in electric and natural gas utility operations and other energy-related businesses. The Company serves approximately 718,000 electric customers in South Carolina and approximately 1.3 million natural gas customers in South Carolina, North Carolina and Georgia.

SCE&G is a regulated public utility engaged in the generation, transmission, distribution and sale of electricity to approximately 718,000 customers in South Carolina.  The company also provides natural gas service to approximately 362,000 customers throughout the state.

Additional information about SCANA and its businesses is available on the Company’s website at www.scana.com.  Additional information about SCE&G is available at www.sceg.com.