Decommissioning Planning, 3812-3846 [E8-574]

Agencies

• NUCLEAR REGULATORY COMMISSION

[Federal Register Volume 73, Number 14 (Tuesday, January 22, 2008)]
[Proposed Rules]
[Pages 3812-3846]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-574]



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Part II





Nuclear Regulatory Commission





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10 CFR Parts 20, 30, 40, et al.



Decommissioning Planning; Proposed Rule

Federal Register / Vol. 73, No. 14 / Tuesday, January 22, 2008 / 
Proposed Rules

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NUCLEAR REGULATORY COMMISSION

10 CFR Parts 20, 30, 40, 50, 70 and 72

RIN 3150-AH45


Decommissioning Planning

AGENCY: Nuclear Regulatory Commission.

ACTION: Proposed rule.

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SUMMARY: The Nuclear Regulatory Commission (NRC) is proposing to amend 
its regulations to improve decommissioning planning, and thereby reduce 
the likelihood that any current operating facility will become a legacy 
site. The amended regulations would require licensees to conduct their 
operations to minimize the introduction of residual radioactivity into 
the site, including subsurface soil and groundwater. Licensees also 
would be required to survey certain quantities or concentrations of 
residual radioactivity, including in subsurface areas, and keep records 
of surveys of subsurface residual radioactivity identified at the site 
with records important for decommissioning. The amended regulations 
would require licensees to report additional details in their 
decommissioning cost estimates, would eliminate two currently approved 
financial assurance mechanisms, and would modify the parent company 
guarantee and self-guarantee financial assurance mechanisms to 
authorize the NRC to require that guaranteed funds be immediately due 
and payable to a standby trust if the guarantor is in financial 
distress. Finally, the amended regulations would require 
decommissioning power reactor licensees to report additional 
information on the costs of decommissioning and spent fuel management.

DATES: Submit comments on the proposed rule by April 7, 2008. Submit 
comments specific to the information collections aspects of this 
proposed rule by February 21, 2008. Comments received after these dates 
will be considered if it is practical to do so, but assurance of 
consideration cannot be given to comments received after these dates.

ADDRESSES: You may submit comments by any one of the following methods. 
Please include the number RIN 3150-AH45 in the subject line of your 
comments. Comments on rulemakings or petitions submitted in writing or 
electronic form will be made available to the public in their entirety 
on the NRC rulemaking Web site. Personal information, such as your 
name, address, telephone number, e-mail address, etc., will not be 
removed from your submission.
    Mail comments to: Secretary, U.S. Nuclear Regulatory Commission, 
Washington, DC 20555-0001, ATTN: Rulemakings and Adjudications Staff.
    E-mail comments to: SECY@nrc.gov. If you do not receive a reply e-
mail confirming that we have received your comments, contact us 
directly at 301-415-1677. Comments can also be submitted via the 
Federal eRulemaking Portal https://www.regulations.gov.
    Hand deliver comments to: 11555 Rockville Pike, Rockville, Maryland 
20852, between 7:30 a.m. and 4:15 p.m. Federal workdays. (Telephone 
301-415-1966).
    Fax comments to: Secretary, U.S. Nuclear Regulatory Commission at 
301-415-1101.
    Selected documents and draft guidance related to this rulemaking, 
including comments, may be viewed and downloaded electronically via the 
Federal eRulemaking Portal https://www.regulations.gov, or may be viewed 
electronically on the public computers located at the NRC's Public 
Document Room (PDR), O1 F21, One White Flint North, 11555 Rockville 
Pike, Rockville, Maryland. The PDR reproduction contractor will copy 
documents for a fee.
    Publicly available documents created or received at the NRC after 
November 1, 1999, are available electronically at the NRC's Electronic 
Reading Room at https://www.nrc.gov/reading-rm/adams.html. From this 
site, the public can gain entry into ADAMS, which provides text and 
image files of NRC's public documents. The ADAMS accession number is 
ML073470819 for publicly available documents and draft guidance related 
to this rulemaking. If you do not have access to ADAMS or if there are 
problems in accessing the documents located in ADAMS, contact the PDR 
Reference staff at 1-800-397-4209, 301-415-4737 or by e-mail to 
pdr@nrc.gov.

FOR FURTHER INFORMATION CONTACT: Kevin O'Sullivan, Office of Federal 
and State Materials and Environmental Management Programs, U.S. Nuclear 
Regulatory Commission, Washington, DC 20555-0001, telephone 301-415-
8112, e-mail kro2@nrc.gov.

SUPPLEMENTARY INFORMATION:

I. Background
II. Discussion
    A. What Action is the NRC Taking?
    B. Who Would This Action Affect?
    C. What Steps Did NRC Take to Prepare for This Rulemaking?
    D. What Alternatives Has NRC Considered?
    E. What Is a Legacy Site?
    F. What Are Financial Assurances?
    G. Why Might Some Materials Licensees Not Have Funds to 
Decommission Their Facility?
    H. Why Is 10 CFR 50.82 Being Amended?
    I. What Changes Are Being Proposed to 10 CFR 20.1406?
    J. What Surveys Are Required Under Proposed Changes to 10 CFR 
20.1501(a)?
    K. What Information Must the Licensee Collect Under Proposed 
Changes to 10 CFR 20.1501?
    L. How Would Licensees Report Required Information to the NRC?
    M. What Financial Assurance Information Must Licensees Currently 
Report to the NRC?
    N. What Are the Proposed Changes to the Financial Assurance 
Regulations?
    O. Will Some Licensees Who Currently Do Not Have Financial 
Assurance Need to Get Financial Assurance?
    P. What Is Changing With Respect to Materials Facilities' 
Decommissioning Funding Plan (DFP) and Decommissioning Cost Estimate 
(DCE)?
    Q. What Is Changing With Respect to License Transfer Regulations 
for Materials Licensees?
    R. What Is Changing With Respect to Permanently Shutdown Reactor 
Decommissioning Fund Status and Spent Fuel Management Plan 
Reporting?
    S. When Do These Proposed Actions Become Effective?
    T. Has NRC Prepared a Cost-Benefit Analysis of the Proposed 
Actions?
    U. Has NRC Evaluated the Additional Paperwork Burden to 
Licensees?
    V. What Should I Consider as I Prepare My Comments to NRC?
III. Discussion of Proposed Amendments by Section
IV. Criminal Penalties
V. Agreement State Compatibility
VI. Plain Language
VII. Voluntary Consensus Standards
VIII. Environmental Assessment and Finding of No Significant 
Environmental Impact
IX. Paperwork Reduction Act Statement
X. Public Protection Notification
XI. Regulatory Analysis
XII. Regulatory Flexibility Certification
XIII. Backfit Analysis

I. Background

    In 1988, NRC issued regulations in Title 10 Code of Federal 
Regulations (10 CFR) parts 30, 40, 50, 51, 70 and 72 establishing new 
financial criteria applicable to decommissioning licensed nuclear 
facilities (53 FR 24018; June 27, 1988). Planning, estimating costs, 
acceptable funding methods, and environmental review provisions were 
among the requirements established in 1988, and were designed to ensure 
that licensee funds would be available when needed to complete safe and 
timely decommissioning of all licensed facilities. Financial assurance 
regulations are part of NRC's overall strategy to maintain public 
health and

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safety, and protection of the environment, during and after nuclear 
facility decommissioning. The NRC announced in 1988 that it intended to 
periodically assess the effectiveness of the funding methods permitted 
in the regulations. Since then, the NRC has issued several amendments 
to the financial criteria applied to decommissioning licensed nuclear 
facilities.
    After NRC published financial assurance regulations in 1988, a 
small number of sites were unable to fully comply with the financial 
assurance requirements. In some cases, these sites had large amounts of 
onsite residual contamination, remediation of which would exceed 
available funds. The Commission directed the staff, in Staff 
Requirements Memoranda (SRMs) dated August 22, 1989, and January 31, 
1990, to develop a strategy for resolving decommissioning issues and to 
develop a prioritized list of contaminated sites. In response, the Site 
Decommissioning Management Plan (SDMP) was developed, containing 
cleanup criteria based in part on residual radioactivity concentrations 
for sites with extensive uranium and thorium contamination.
    In 1993 (58 FR 68726), licensees that passed financial test 
criteria were allowed to use a self-guarantee to provide financial 
assurance for decommissioning. In 1996 (61 FR 39299; July 29, 1996), 
nuclear power reactor decommissioning procedures were clarified, while 
recognizing that the radioactivity resulting from contaminated 
materials and effluents (air and water) must be minimized and 
controlled. In 1998 (63 FR 29535; June 1, 1998), use of the self-
guarantee method was broadened to include some commercial licensees who 
do not issue bonds, as well as non-profit licensees, such as colleges, 
universities and hospitals. Also in 1998 (63 FR 50465; September 22, 
1998), NRC amended power reactor decommissioning financial assurance 
requirements in response to potential deregulation of the power 
generating industry. In 2003 (68 FR 57327; October 3, 2003), the set of 
materials licensees for which financial assurance is required was 
expanded to include all waste brokers. Additionally, large irradiators 
were required to prepare a site-specific decommissioning cost estimate 
as the basis of their financial assurance; decommissioning 
certification amounts were increased by 50 percent; and decommissioning 
cost estimates were required to be updated for certain licensees at 
least every 3 years.
    Apart from these changes in financial assurance requirements 
summarized above, more comprehensive and risk informed decommissioning 
regulations were issued in 1997 as Subpart E of 10 CFR part 20 (62 FR 
39058; July 21, 1997). This set of requirements is known as the License 
Termination Rule (LTR). The LTR is based on calculated doses, and it 
established specific radiological criteria for remediation of lands and 
structures to complete site decommissioning and successfully terminate 
the license. The LTR provides an overall approach for license 
termination for two different site conditions: unrestricted use and 
restricted conditions for use after license termination. The LTR 
applies to the decommissioning of facilities licensed under 10 CFR 
parts 30, 40, 50, 60, 61, 63, 70 and 72. In the Federal Register notice 
publishing the LTR final rule, in response to a public comment that the 
requirements of then-proposed 10 CFR 20.1406 should apply to all 
licensees, rather than only to applicants for new licenses, the 
Commission stated:
    Applicants and existing licensees, including those making 
license renewals, are already required by 10 CFR part 20 to have 
radiation protection programs aimed towards reducing exposure and 
minimizing waste. In particular, Sec. 20.1101(a) requires 
development and implementation of a radiation protection plan 
commensurate with the scope and extent of licensed activities and 
sufficient to ensure compliance with the provisions of 10 CFR part 
20. Section 20.1101(b) requires licensees to use, to the extent 
practicable, procedures and engineered controls to achieve public 
doses that are ALARA. In addition, lessons learned and documented in 
reports such as NUREG-1444 have focused attention on the need to 
minimize and control waste generation during operations as part of 
development of the required radiation protection plans. Furthermore, 
the financial assurance requirements issued in the January 27, 1988 
(53 FR 24018), rule on planning for decommissioning require 
licensees to provide adequate funding for decommissioning. These 
funding requirements create great incentive to minimize 
contamination and the amount of funds set aside and expended on 
cleanup. (62 FR 39082; July 21, 1997).

Current 10 CFR 20.1101(a) requires each licensee to implement a 
radiation protection program to ensure compliance with the regulations 
in 10 CFR part 20. Current Sec.  20.1101(b) requires each licensee to 
use, to the extent practical, procedures and engineering controls based 
upon sound radiation protection principles to achieve occupational 
doses and doses to members of the public that are as low as reasonably 
achievable (ALARA). Licensees need to apply operating procedures and 
controls to evaluate potential radiological hazards and methods to 
minimize and control waste generation during facility operations, to 
achieve doses that are ALARA.
    In SRM-SECY-01-0194, dated June 18, 2002, the Commission directed 
the staff to conduct an analysis of LTR issues. The staff conducted the 
analysis and presented results and recommendations to the Commission in 
SECY-03-0069 (https://www.nrc.gov/reading-rm/doc-collections/commission/
srm/2003/2003-0069srm.pdf), (dated May 2, 2003, and known as the LTR 
Analysis). One of the recommendations was a set of ``measures to 
prevent future legacy sites.'' A legacy site is a facility that is in 
decommissioning status with complex issues and an owner who cannot 
complete the decommissioning work for technical or financial reasons 
(as discussed further in Section II.E of this document). The set of 
measures to prevent future legacy sites had two distinct parts: (1) The 
need for timely reporting during facility operations of subsurface 
contamination that has a potential to complicate future decommissioning 
efforts; and (2) The need for more detailed reporting of licensee 
financial assurance mechanisms to fund site decommissioning activities 
and protection of the committed funds in cases of financial distress. 
The need for timely reporting of subsurface contamination during 
facility operations was explained in Attachment 8 to SECY-03-0069. 
Attachment 8, under the heading ``chronic releases,'' recommended 
revising 10 CFR 20.1406 to extend its minimization of contamination 
requirements to cover licensees in addition to license applicants. 
Recommendations for more detailed decommissioning financial assurance 
requirements are set forth in Attachment 7 to SECY-03-0069.
    In SRM-SECY-03-0069 the Commission approved the staff's 
recommendations summarized above, and authorized this proposed 
rulemaking. As pertinent to the proposed 10 CFR 20.1406 and 10 CFR 
20.1501 revisions, the Commission's SRM states as follows:

    ``The Commission has approved the staff's recommendation related 
to changes in licensee operations as described in attachment 8. 
However, in addition to incorporating risk-informed approaches, the 
staff should ensure that they are performance-based. The staff will 
have to be very careful when crafting the guidance documents so that 
it is clear to the licensees and to the staff how much 
characterization information is enough. The staff should only ask 
for limited information. Licensees should

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not be required to submit the equivalent of a full scale MARSSIM 
[Multi-Agency Radiation Survey and Site Investigation Manual] survey 
every year.''

    During 2003 and 2004, the NRC staff evaluated the decommissioning 
program and proposed other improvements to protect public health and 
safety beyond those identified in the LTR Analysis. To integrate and 
track regulatory improvements resulting from the LTR Analysis and the 
Decommissioning Program Evaluation, the NRC adopted an Integrated 
Decommissioning Improvement Plan (IDIP) for activities during FY 2004 
through 2007. Among other actions, the IDIP calls for publication of 
this proposed rule and written guidance describing changes in the 
regulations to prevent future legacy sites.
    In 2005 and 2006, the operators of several nuclear power plants 
reported that inadvertent and unmonitored radioactive liquid releases, 
primarily tritium contained in water, had occurred. In some instances, 
the release of radioactive liquid was not recognized by the licensee 
until years after the release apparently started. The NRC Executive 
Director for Operations chartered a Task Force to conduct a lessons-
learned review of these incidents. The Task Force final report dated 
September 1, 2006, concluded that the levels of tritium and other 
radionuclides measured thus far do not present a health hazard to the 
public, and presenting a list of findings and recommendations that the 
Task Force believed would improve plant operations and public 
confidence in nuclear plant operations. The findings and 
recommendations in the Task Force report identified the need to clarify 
existing licensee requirements to demonstrate that they have achieved 
public and occupational exposures that are ALARA, during the life cycle 
of the facility which includes the decommissioning phase.

II. Discussion

A. What Action Is the NRC Taking?

    The NRC is proposing changes to its regulations to improve 
decommissioning planning, and thereby reduce the likelihood that 
facilities under its jurisdiction will become legacy sites. To help 
achieve this goal, one set of complementary amendments have been 
proposed that would revise 10 CFR 20.1406 to make it applicable to 
licensees with operating facilities as well as to license applicants, 
and revise 10 CFR 20.1501(a) by replacing its undefined term 
``radioactive material'' with ``residual radioactivity,'' a term 
already defined in 10 CFR part 20. This defined term includes 
subsurface contamination within its scope. Both 10 CFR 20.1406(c) and 
20.1501(a) are being worded to include subsurface contamination within 
their scope by using the term ``residual radioactivity.'' These changes 
serve to reinforce the intended linkage between these provisions, and 
are consistent with NRC policy that licensees conduct operations to 
minimize the generation of waste, to facilitate later facility 
decommissioning. A second set of proposed changes to improve 
decommissioning planning addresses decommissioning financial assurance 
requirements.
    The proposed new 10 CFR 20.1406(c) states as follows:

    (c) Licensees shall, to the extent practical, conduct operations 
to minimize the introduction of residual radioactivity into the 
site, including the subsurface, in accordance with the existing 
radiation protection requirements in Subpart B and radiological 
criteria for license termination in Subpart E of this part.

    The proposed revised 10 CFR 20.1501(a) and (b) state as follows:

    (a) Each licensee shall make or cause to be made, surveys of 
areas, including the subsurface, that--
    (1) May be necessary for the licensee to comply with the 
regulations in this part; and
    (2) Are reasonable under the circumstances to evaluate--
    (i) The magnitude and extent of radiation levels; and
    (ii) Concentrations or quantities of residual radioactivity; and
    (iii) The potential radiological hazards of the radiation levels 
and residual radioactivity detected.
    (b) Records from surveys describing the location and amount of 
subsurface residual radioactivity identified at the site must be 
kept with records important for decommissioning.

    As indicated, use of the term ``residual radioactivity'' is a key 
component of the above proposed requirements, and this term is 
discussed below.
1. Residual Radioactivity
    As set forth in 10 CFR 20.1003:

    ``Residual radioactivity means radioactivity in structures, 
materials, soils, groundwater, and other media at a site resulting 
from activities under the licensee's control. This includes 
radioactivity from all licensed and unlicensed sources used by the 
licensee, but excludes background radiation. It also includes 
radioactive materials remaining at the site as a result of routine 
or accidental releases of radioactive material at the site and 
previous burials at the site, even if those burials were made in 
accordance with the provisions of 10 CFR part 20.''

    Certain operational events (e.g., slow, long-term leaks), 
particularly those that cause subsurface soil and ground-water 
contamination, can significantly increase the cost of decommissioning. 
To adequately assure that a decommissioning fund will cover the costs 
of decommissioning, the owner of a facility must have a reasonably 
accurate estimate of the extent to which residual radioactivity is 
present at the facility, particularly in the subsurface soil and ground 
water. As reflected above, the new 10 CFR 20.1406(c) would require that 
licensees conduct their operations in a manner that will minimize the 
introduction of residual radioactivity into the site.
    Section 20.1501(a) would be revised by replacing its undefined term 
``radioactive material'' with ``residual radioactivity.'' To some 
people, the phrase ``residual radioactivity'' may have a connotation 
implying radioactive material that is ``left over'' after operations. 
This is not the meaning. As reflected in its definition stated 
previously, this term includes everything that the term ``radioactive 
material'' implies in the current rule language as well as other 
radioactive material resulting from activities under the licensee's 
control, such as radioactive material in the subsurface. The use of the 
term ``residual radioactivity'' in Sec. 20.1501(a) also is intended to 
provide a link with new Sec.  20.1406(c). The amended Sec.  20.1501(a) 
would retain previous survey requirements, but would add that such 
requirements include consideration of waste in the form of residual 
radioactivity. Together, the amended Sec. Sec.  20.1501(a) and 
20.1406(c) specify that compliance with 10 CFR part 20 requirements is 
a necessary part of effectively planning for decommissioning. The new 
Sec. Sec.  20.1406(c) and 20.1501(a) provisions are discussed further 
in Sections II.I and J of this document. These activities, undertaken 
during facility operations, would provide a technical basis for 
licensees and NRC to understand the effects of significant residual 
radioactivity on decommissioning costs, and to determine whether 
existing financial assurance provided for site-specific decommissioning 
is adequate. By using the term ``residual radioactivity,'' the new 
Sec. Sec.  20.1406(c) and 20.1501(a) cover any licensed and unlicensed 
radioactive material that have been introduced to the site by licensee 
activities.
    The new paragraph 10 CFR 20.1501(b) would be revised to require 
licensees to keep records of surveys of subsurface residual 
radioactivity identified at the site with records important for 
decommissioning.

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    During operations, residual radioactivity that would be significant 
for decommissioning planning would be a quantity of radioactive 
material that would later require remediation during decommissioning to 
meet the unrestricted use criteria of 10 CFR 20.1402. Significant 
residual radioactivity in subsurface media, such as soil, is a 
component of waste because it must be removed and disposed of to meet 
unrestricted use criteria in 10 CFR 20.1402.
    During decommissioning, the licensee must evaluate dose from 
residual radioactivity surveyed at its site using the radiological 
criteria in Subpart E to 10 CFR part 20. For contamination migrating 
offsite from previous leaks and spills into the subsurface, a licensee 
must comply with the applicable license conditions for its facility. 
Such offsite contamination, released as an effluent in quantities below 
annual regulatory limits, has been a factor in the decommissioning of a 
few NRC and Agreement State sites. However, the scope of this 
rulemaking does not include offsite contamination discovered during 
decommissioning, unless such contamination is an extension of onsite 
contamination (e.g., a contaminated ground water plume originating from 
the licensee's facility).
    NRC's technical basis for the effect that significant residual 
radioactivity in the subsurface has on decommissioning costs is based 
on a 2005 NRC staff study, ``General Guidance for Inspections and 
Enforcement to Prevent Future Legacy Sites and Indicators of Higher 
Risk of Subsurface Contamination'' [NRC ADAMS Accession Number 
ML052630421]. The purpose of this study was to evaluate experience at 
sites that have undergone, or were undergoing decommissioning to 
identify the types of events that have caused subsurface contamination. 
Associating these events with knowledge of currently operating sites 
provided a means for NRC staff to evaluate the potential for future 
subsurface contamination at currently operating facilities. This risk-
informed approach concluded that the sites with a higher likelihood of 
becoming legacy sites shared the following characteristics: relatively 
large volumes of low specific activity radioactively contaminated 
liquids; large volumes of long-lived radionuclides; large throughput; 
liquid processes; or processes that involve large quantities of solid 
radioactive material stored outdoors. The study identified a number of 
events that could increase decommissioning costs by increasing the 
possibility of soil or ground-water contamination, and concluded that 
these events should cause the licensee to reevaluate its 
decommissioning cost estimate. Additional discussion on this topic is 
in Sections II.G and II.H of this document.
    NRC considers proposed changes to 10 CFR 20.1406 and 20.1501 to be 
consistent with existing NRC policy for operating facilities. Under 10 
CFR 20.1101(b), licensees must use procedures and engineering controls 
to achieve occupational doses and doses to members of the public that 
are ALARA, during operations and during decommissioning. To accomplish 
this, licensees must be able to demonstrate their knowledge of residual 
radioactivity in the subsurface, including soil and ground-water 
contamination, particularly if the subsurface contamination is a 
significant amount that would require remediation during 
decommissioning to meet the unrestricted use criteria of 10 CFR 
20.1402. This is an extension of the requirements promulgated, with 
widespread agreement, in the 1997 LTR that were applicable only to 
license applicants. This action is needed because subsurface residual 
radioactivity at current operating facilities may be a potential 
radiological hazard, and a risk to fully fund decommissioning while the 
facility is in an operating mode. The linkage between new 10 CFR 
20.1406(c) and amended 10 CFR 20.1501(a) better institutes existing NRC 
policy with respect to subsurface contamination during facility 
operations, to achieve doses that are ALARA, and identifies to 
licensees that survey requirements may be a necessary part of 
effectively planning for decommissioning as well as to comply with dose 
limits.
2. Financial Assurance
    The proposed rule (amending Sec. Sec.  30.35, 40.36, 70.25 and 
72.30, and Criterion 9 of appendix A to part 40) would codify certain 
aspects of existing regulatory guidance to improve the quality of 
Decommissioning Funding Plans (DFP), and would apply NRC experience to 
increase the likelihood that adequate funds will be available when 
needed to complete the decommissioning process. The proposed rule 
amendments would allow materials licensees to base their financial 
assurance for decommissioning on a ``certification amount'' only if the 
licensee's site surveys do not indicate the presence of residual 
radioactivity in amounts that would prevent the site from meeting the 
unrestricted use criteria in Sec.  20.1402. The proposed rule would 
address the potential vulnerability of the parent company guarantee and 
the self-guarantee as the financial mechanism for decommissioning 
funding assurance during financial distress of the guarantor. Each of 
the licensees who use the guarantee mechanism would be required to 
establish a standby trust fund to receive the guaranteed financial 
assurance amount should that amount become immediately due and payable.
    Licensees with reactors in a decommissioning status would have 
additional reporting requirements for decommissioning fund status, 
spent fuel management costs, and estimated decommissioning costs. These 
proposed reporting requirements, in part, modify the existing Post 
Shutdown Decommissioning Activities Report requirements set forth in 10 
CFR 50.82(a)(4)(i). Additional reporting requirements would require 
each power reactor licensee undergoing decommissioning to thereafter 
submit an annual financial assurance status report, as set forth in new 
paragraphs (a)(8)(v)-(a)(8)(vii) of 10 CFR 50.82(a)(8).
    Under the proposed rule, all licensees decommissioning their 
facilities pursuant to 10 CFR 20.1403 restricted release criteria would 
be required to use a trust fund to meet the financial assurance 
requirements. A trust fund would be the only financial assurance 
mechanism allowed for the long term maintenance and surveillance of 
restricted release sites unless a government organization either 
provides a guarantee of funds or assumes custody and ownership of the 
site. This topic is discussed further in Sections II.M, N and O of this 
document.

B. Who Would This Action Affect?

    Based on the Regulatory Analysis for this proposed rule, NRC 
estimates that a small number of materials licensees (a total of about 
5 NRC and Agreement State licensees) would need to perform additional 
site surveys due to the presence of significant residual radioactivity. 
The licensees who will need to perform additional surveys were modeled 
in the Regulatory Analysis as rare metal extraction facilities with 
uranium as a soil contaminant. Although the number of licensees 
affected by the proposed rule is small, the cost to States or the 
Federal Government to enforce and then fully decommission a single 
legacy site is much higher than the cost to prevent the occurrence of a 
legacy site through amended regulations.
    For NRC licensees who have subsurface residual radioactivity with 
no ground water implications, a minimal, routine monitoring plan may 
remain in effect through license

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termination. The routine monitoring plan is described in draft 
regulatory guidance released concurrently with this proposed rule. 
Application of a minimal, routine monitoring plan at sites with no 
ground water implications is meant to improve licensee decommissioning 
planning and the basis used for decommissioning cost estimates.
    The large majority of NRC and Agreement State licensees are not 
expected to have residual radioactivity because they possess small 
amounts of short-lived byproduct material or byproduct material that is 
encased in a capsule designed to prevent leakage or escape of the 
byproduct material (i.e., a sealed source). This set of licensees is 
expected to include the non-fuel-cycle nuclear facilities, which either 
have no significant residual radioactive contamination to be cleaned 
up, or, if there is contamination, it is localized or will be quickly 
reduced to low levels by radioactive decay. Licensees who do not have 
residual radioactivity and do not have an obligation to set aside funds 
for decommissioning financial assurance would not be affected by this 
proposed rule. Draft regulatory guidance released concurrently with 
this proposed rule describes an acceptable method for these licensees 
to confirm the absence of subsurface residual radioactivity at their 
facilities.
    Approximately 300 NRC materials licensees and over 1,000 Agreement 
State licensees have an obligation to set aside funds for 
decommissioning financial assurance. Of these, approximately 50 percent 
use a certified amount, specified in regulations, with the remaining 50 
percent using a site-specific DFP or License Termination Plan to meet 
the decommissioning financial assurance requirements. If there is 
significant residual radioactivity at the site, the changes in 
Sec. Sec.  30.35, 40.36, 70.25, and 72.30 would require a licensee to 
switch out of its certified funding amount, and replace the certified 
amount with a DFP. In preparing this proposed rule, NRC staff was not 
aware of any licensees using certified amounts for decommissioning that 
would need to switch to a DFP because of significant residual 
radioactivity.
    Licensees using a site-specific DFP or License Termination Plan to 
meet decommissioning financial assurance requirements would have 
additional reporting requirements based on changes in Sec. Sec.  30.35, 
40.36, 50.82, 70.25, and 72.30. The materials licensees under 10 CFR 
part 30, 40, 70 and 72 would need to provide more details to support 
their decommissioning cost estimate, such as the assumed cost of an 
independent contractor to perform all decommissioning activities. The 
power reactor licensees under 10 CFR part 50 would need to provide more 
details to support their decommissioning schedule, cost estimates for 
managing irradiated fuel, and annual financial assurance status report.
    The proposed changes to 10 CFR 50.82(a) affect the 12 power reactor 
licensees undergoing decommissioning. Such licensees would need to 
provide more details regarding their decommissioning cost estimates, 
including those for managing irradiated fuel. More specifically, 
licensees who have submitted a certification of permanent cessation of 
operations under 10 CFR 50.82(a) would thereafter be subject to annual 
financial assurance reporting requirements similar to those imposed on 
operating reactors under existing 10 CFR 50.75(f). The annual reports 
would identify yearly decommissioning expenditures, the remaining 
balance of decommissioning funds, and would contain a cost estimate to 
complete decommissioning. Similar to the one-time reports required by 
10 CFR 50.54(bb), the proposed annual reports to be required under 10 
CFR 50.82(a)(8) would identify the amount of funds accumulated to 
manage irradiated fuel, and the projected cost of managing the 
irradiated fuel until title and possession is transferred to the 
Secretary of Energy.
    Approximately 20 licensees who use an escrow account as a 
prepayment financial mechanism would be affected by proposed changes in 
Sec. Sec.  30.35, 40.36, 70.25, and 72.30 (which would eliminate the 
escrow account as a prepayment financial assurance method). No 
licensees are using a line of credit as a financial mechanism; both the 
escrow account and the line of credit are proposed for elimination as 
acceptable financial assurance instruments.
    Approximately 45 NRC licensees use a parent company guarantee or 
self-guarantee as a financial assurance mechanism. These licensees may 
be affected by proposed changes in 10 CFR part 30, appendices A, C, D, 
and E, which would require establishment of a standby trust fund before 
the guarantee becomes effective. The standby trust fund would be set up 
for receipt of funds in the case of financial distress by the 
guarantor. In the Regulatory Analysis and Paperwork Reduction Act 
burden estimate, NRC has assumed that a total of 25 of these licensees 
would need to establish a trust fund to comply with the amended 
regulations with the other 20 already having an established trust fund.
    The Regulatory Analysis for this proposed rule, referenced in 
Section X of this document, has detailed cost-benefit estimates 
regarding the licensees who would be affected by the amended 
regulations.

C. What Steps Did NRC Take To Prepare for This Rulemaking?

    The NRC took several initiatives to enhance stakeholder involvement 
and to improve efficiency during the rulemaking process. On May 28, 
2004, the NRC staff issued Regulatory Information Summary (RIS) 2004-
08, ``Results of the License Termination Rule Analysis.'' This RIS was 
the first follow-up action taken in response to SRM-SECY-03-0069. The 
purpose of the RIS was to inform licensees and stakeholders of NRC's 
analysis of the issues associated with implementing the LTR, the 
Commission's direction to resolve these issues, the schedule for future 
actions, and opportunities for stakeholder comment. The RIS noted that 
stakeholder involvement would be an important part of developing the 
planned rulemaking and guidance.
    In April 2005, the NRC conducted a two-day decommissioning workshop 
examining a number of LTR topics, including potential changes in 
facility operating requirements and changes to financial assurance to 
prevent legacy sites. Stakeholders addressed the issues and potential 
resolutions included in this proposed rule. Since then, NRC has 
maintained a series of web pages with information (https://www.nrc.gov/
about-nrc/regulatory/decommissioning.html) including draft guidance 
documents, Commission papers, and a variety of decommissioning program 
documents. NRC presented papers on the scope of this proposed 
rulemaking at American Nuclear Society conferences in 2004, 2005 and 
2006 and other stakeholder forums.
    In June 2006, the NRC formed a proposed rule Working Group of NRC 
staff and one Agreement State representative from the Organization of 
Agreement States (OAS). The NRC has held discussions with State and 
Federal agencies on their experience with trust funds for long-term 
financial assurance, including a discussion with the U.S. Environmental 
Protection Agency (EPA) on October 6, 2006.
    In January 2007, the NRC held a public roundtable meeting that was 
attended by about 70 stakeholders. The meeting was held to solicit 
input from stakeholders and interested members of the public regarding 
the issues of licensee control and identification of

[[Page 3817]]

subsurface residual radioactivity, and proposed changes to 
decommissioning financial assurance requirements. The Summary Notes and 
transcript of this public meeting are posted on: https://www.nrc.gov/
about-nrc/regulatory/decommissioning/public-involve.html.

D. What Alternatives Has NRC Considered?

    The rulemaking Working Group considered different alternatives for 
the proposed rule and agreed on the following for analysis in the 
Environmental Assessment (see Section VIII of this preamble) and the 
Regulatory Analysis (see Section XI of this preamble):
    Alternative 1: No Action.
    This alternative provides a baseline to assess the other two 
alternatives. It assumes that if no changes are made to the 
regulations, there will be additional legacy sites from currently 
operating facilities licensed by NRC and Agreement States.
    Alternative 2: Monitoring with proposed changes to financial 
assurance.
    This alternative would implement the proposed changes in 10 CFR 
20.1406(c) and 20.1501, and the proposed changes to decommissioning 
planning and financial assurance requirements.
    Alternative 3: Monitoring with proposed changes to financial 
assurance, and collateral.
    This alternative would implement the proposed changes in 
Alternative 2, and one additional requirement for a security interest 
in collateral to support the decommissioning assurance pledged in the 
parent company guarantee and self-guarantee financial assurance 
mechanisms.
    NRC considered two other alternatives, beyond the three noted 
previously, but did not analyze them in as much detail. One alternative 
was to require that materials licensees obtain accidental property 
damage insurance to cover the reasonable costs of decontaminating its 
facility and site and disposing of contaminated materials in the event 
of a large, sudden and accidental onsite release of radioactive 
material. This was prompted, in part, by the objective to apply 
consistent financial assurance standards to reactors and materials 
facilities. The NRC requires reactor licensees, under 10 CFR 50.54(w), 
to obtain insurance to pay for cleaning up an accidental release of 
radioactive material that causes a present danger of release offsite 
that would pose a threat to public health and safety. NRC staff 
evaluated whether it would be appropriate to require onsite property 
damage insurance for materials facilities to pay costs associated with 
cleaning up a sudden and accidental event that could, if the operators 
needed to shut down the facility, overwhelm the decommissioning fund. 
This issue has been addressed before. On June 7, 1985 (50 FR 23960), 
the NRC published an advanced notice of proposed rulemaking requesting 
comments on requiring financial assurance for the cleanup of accidental 
or unexpected contamination, both onsite or offsite. After several 
technical studies were conducted, the NRC concluded in 1995 that no 
such rulemaking was necessary. The NRC has revisited this issue and has 
found that there have been no significant changes affecting the 1995 
conclusion. Accidents at materials facilities that require expensive 
cleanup continue to be rare, with annual costs of cleanup small. The 
reportable radioactive material spills and releases from materials 
facilities over the 15-year period since 1991, as documented in the 
Nuclear Materials Events Database, have been about 2 events per year. 
Those events were primarily one-time small spills caused by mechanical 
failure of a valve, pump or pipe or in a few cases from human error. In 
the early 1990s there were several reportable events of contaminated 
drain lines or leakage from a storage pond, but these types of low-
level chronic contaminating events have not been reported at facilities 
since then.
    NRC determined that materials licensees are not able to obtain, at 
reasonable cost, environmental impairment liability insurance, 
including nuclear contamination events from both sudden and gradual 
accidental releases. American Nuclear Insurers (ANI), an agent for 
multiple insurance companies, provides non-reactor nuclear liability 
policies that provide coverage for third party claims made to cover 
off-site liability damages. The policies do not cover onsite damages 
nor do the policies cover the cost of environmental cleanup that would 
exceed the actual damages to the third party. NRC had determined that 
non-reactor property insurance is available, but this insurance would 
exclude ``gradual contamination'' and cover only damages caused by a 
``sudden and accidental'' event. Because the events occur only rarely 
and on a small scale, NRC has decided not to propose amendments to 
require materials licensees to obtain environmental cleanup insurance.
    The occurrence of ``gradual contamination,'' such as leakage 
outside the licensee's buildings, is intended to be addressed by the 
proposed changes to Sec. Sec.  20.1406(c) and 20.1501. Funding to 
remediate the leakage would be addressed by changes in the requirements 
for reporting decommissioning fund status and decommissioning cost 
estimates.
    Another alternative considered by NRC is the use of licensee 
incentives to facilitate decommissioning planning and reduce the 
likelihood of future legacy sites. In Section II.V of this document, 
NRC seeks public comments on this topic. The Advisory Committee on 
Nuclear Waste (ACNW) recommended, in a December 27, 2006, letter to 
Chairman Klein, that NRC staff should consider offering financial 
incentives to certain licensees to encourage their use of integrated 
monitoring and modeling approaches to demonstrate compliance with 
regulations and to apply site characterization data in a conceptual 
site model maintained during the facility lifetime. The regulations in 
10 CFR 171.11(b) allow the Commission to grant an exemption in a 
licensee fee that it determines is authorized by law or otherwise in 
the public interest. NRC staff is not aware of any time the Commission 
has used a 10 CFR part 171 annual fee exemption for this purpose. NRC 
staff was aware of 10 CFR part 170 fee exemptions, or fee waivers, for 
plants to ``pilot'' a new license amendment process. In practice, fee 
waivers are given very sparingly and only with convincing evidence that 
there is a public benefit to the waiver. The cost of a fee waiver would 
have to be paid through annual fees from other NRC licensees.

E. What Is a Legacy Site?

    A legacy site is a facility that is in decommissioning status with 
complex issues and an owner who cannot complete the decommissioning 
work for technical or financial reasons. These sites have been 
materials facilities, not reactor facilities.
    The purpose of this proposed rulemaking is to improve 
decommissioning planning and thereby reduce the likelihood that a site 
will become a legacy site, thus avoiding unnecessary expense and 
promoting more timely return of licensed sites to other productive 
uses.
    NRC terminates several hundred materials licenses each year. Most 
of these are routine actions, and the sites require little, if any, 
remediation to meet NRC's unrestricted use criteria. There are other 
sites where more complex decommissioning actions are needed. These 
complex decommissioning sites are described, along with the objectives 
of NRC decommissioning activities, in the ``Status of Decommissioning

[[Page 3818]]

Program 2006 Annual Report'' available at: https://www.nrc.gov/about-
nrc/regulatory/decommissioning/program-docs.html. This report 
identifies and describes the status of 32 complex materials sites 
undergoing decommissioning. Of the total 32 complex sites, NRC 
considers 8 of these to be legacy sites as of December 31, 2006. 
Residual radioactivity at the complex decommissioning sites is 
primarily from the following radionuclides: U-235, U-238, Th-232, Ra-
226, Cs-137, Am-241, Sr-90, and H-3. Public or occupational exposure to 
these radionuclides may be a radiological hazard.

F. What Are Financial Assurances?

    Financial assurances are financial arrangements provided by a 
licensee, whereby funds for decommissioning will be available when 
needed. Each NRC licensee has a regulatory obligation to properly 
decommission its facility. However, only licensees whose 
decommissioning cost is likely to exceed a threshold amount must 
provide financial assurance. All nuclear power reactors and about 7 
percent of NRC materials licensees must provide decommissioning 
financial assurance. This financial assurance may be funds set aside by 
the licensee or a guarantee that funds will be available when needed. 
The guarantee may be provided by a qualified third party or, upon 
passage of a financial test by the licensee. The third party may be the 
parent company of the licensee, which is the case for about 10 percent 
of the NRC materials licensees who are obligated to have 
decommissioning financial assurance.
    Nuclear power reactors have financial assurance obligations that 
are different from materials licensees. The minimum amount of financial 
assurance for reactors is defined in 10 CFR 50.75, and the acceptable 
financial assurance mechanisms are defined in Sec.  50.75(e)(1). An 
external sinking fund is used to provide financial assurance for about 
90 percent of the reactors. The remaining 10 percent of reactors have 
assurance through prepaid funds and/or guarantees. No changes in these 
requirements are planned for power reactor licensees.
    As of December 31, 2006, there are about 300 NRC materials 
licensees that have a regulatory obligation to provide approved 
financial assurance mechanisms. An acceptable financial assurance 
mechanism for unrestricted use decommissioning is any of the following 
four types of financial instruments:
     A prepayment of the applicable decommissioning costs;
     A guarantee to pay the decommissioning costs issued by a 
qualified third party or the licensee;
     A statement of intent from a Federal, state or local 
government licensee; or
     An external sinking fund.
    The prepayment method is full payment in advance of decommissioning 
using an account segregated from licensee assets and outside the 
licensee's administrative control. About 11 percent of current 
financial assurance mechanisms for materials licensees are prepayment 
methods, with most of these being escrow accounts. Currently accepted 
prepayment mechanisms include escrow accounts (8 percent), trust funds 
(2 percent), certificates of deposit (1 percent), government funds (0 
percent), and deposits of government securities (0 percent). The 
proposed rule would eliminate all prepayment mechanisms except the 
trust fund, for reasons discussed under Section II.N.2 of this 
document.
    The guarantee method can be used by licensees that demonstrate 
adequate financial strength through their annual completion of 
financial tests contained in appendices A, C, D, and E of 10 CFR part 
30. About 51 percent of current financial assurance mechanisms for 
materials licensees are guarantee methods. Currently accepted guarantee 
mechanisms include letters of credit (28 percent), parent company 
guarantees (8 percent), licensee self-guarantees (7 percent), surety 
bonds (8 percent), lines of credit (0 percent), and insurance policies 
(0 percent). The proposed rule would eliminate the line of credit as an 
acceptable mechanism, for reasons discussed under Section II.N.10 of 
this document.
    The statement of intent is a commitment from a Federal, state or 
local government licensee that it will request and obtain 
decommissioning funds from its funding body, when necessary for 
decommissioning an NRC licensed site. It is available for use only by 
governmental entities. Approximately 38 percent of the NRC materials 
licensees with financial assurance use the statement of intent as a 
means to provide financial assurance.
    The external sinking fund allows the licensee to gradually prepay 
the decommissioning cost estimate, with the amount that is not prepaid 
covered by a surety mechanism or insurance, for materials licensees, or 
by surety, insurance, or a guarantee method for power reactor 
licensees. In a final rulemaking for power reactor financial assurance, 
the NRC allowed use of a parent company guarantee or self-guarantee 
with an external sinking fund (63 FR 50465; September 22, 1998). 
Analogous reasoning applies to materials licensees. The proposed rule 
amendments would make conforming changes in the financial assurance 
requirements for materials licensees (10 CFR 30.35, 40.36, 70.25, and 
72.30) to provide greater consistency with the 10 CFR part 50 
regulations. None of the NRC materials licensees that have an 
obligation to provide decommissioning financial assurance currently use 
an external sinking fund.
    The previous discussion was for financial assurance to decommission 
a site for unrestricted use under 10 CFR 20.1402. If a licensee can 
demonstrate its ability to meet the provisions of 10 CFR 20.1403 for 
restricted use, financial assurance for long-term surveillance and 
control may be provided by a trust fund or by a government entity 
assuming ownership and custody of the site.

G. Why Might Some Materials Licensees Not Have Funds To Decommission 
Their Facility?

    In SECY-03-0069, NRC evaluated licensee decommissioning experience 
and identified the following five reasons why some licensees may not 
have enough funds to complete their decommissioning activities.
    1. Licensees at complex sites may underestimate decommissioning 
costs, if the assumption that the site will qualify for a restricted 
release proves incorrect. The cost for a restricted release is usually 
significantly lower than unrestricted release given the high offsite 
disposal costs of licensed material when compared to the cost of onsite 
controls. If it turns out that the licensee cannot meet the 10 CFR 
20.1403 criteria for restricted conditions, the licensee may then not 
be able to meet its decommissioning financial obligations. To address 
this problem, the NRC proposes to amend 10 CFR 30.35, 40.36, 70.25 and 
72.30 to require licensees to obtain NRC approval of their DFP based on 
a decommissioning cost estimate for unrestricted release, unless the 
ability to meet the restricted release criteria can be adequately 
shown.
    2. Certain operational events, particularly those that cause soil 
or ground-water contamination, can increase decommissioning costs if 
not addressed during the life of the facility. If the licensee does not 
identify these events, assess the problem in a timely manner, and 
update its decommissioning cost estimate based on new conditions, the 
licensee may find it

[[Page 3819]]

difficult to later meet its decommissioning obligations. To address 
this problem, the NRC proposes to amend 10 CFR 20.1406 as discussed in 
Section II.A above. Licensees also would be required, in proposed 
amendments to 10 CFR 30.35, 40.36, 70.25 and 72.30, to factor in 
residual radioactivity information in arriving at decommissioning cost 
estimates.
    3. Certain financial assurance methods may not be effective in 
bankruptcy situations, given that funds held in them may be accessible 
to creditors. For example, title to property held in escrow remains 
with the licensee, making the property potentially vulnerable to claims 
by creditors. Another example is the parent and self-guarantees. The 
guarantees promise performance rather than payment. In the past, two 
companies used corporate reorganization to isolate the decommissioning 
obligations with the subsidiary company, but with insufficient funds to 
perform the work. In one case, the parent company reorganized without 
NRC approval and transferred to the subsidiary few assets and low 
levels of operating profits, so that the subsidiary was able to fund 
only a small portion of its decommissioning costs. In the second case, 
the parent company purchased the licensee before the time the financial 
assurance regulations were in effect. The licensee was permanently shut 
down after the purchase and was unable to provide full financial 
assurance. To address this problem, the NRC proposes to amend 10 CFR 
30.35, 40.36, 70.25, 72.30, and 10 CFR part 30 appendices A, C, D, and 
E by eliminating the use of an escrow account as a financial assurance 
option, and requiring a guarantor, as a condition of using the parent 
company guarantee and self-guarantee financial assurance options, to 
establish a standby trust fund and to submit to a Commission order, if 
the guarantor is in financial distress, to immediately pay the 
guaranteed funds into the standby trust.
    4. The funds set aside by licensees to carry out decommissioning 
may decline in value over time. To address this problem, the NRC 
proposes to amend 10 CFR 30.35(h), 40.36(f), 70.25(h), and 72.30(g) to 
require that licensees monitor the status of its decommissioning funds 
and, if necessary, add funds if the balance falls below the estimated 
cost of decommissioning.
    5. The initial funding of a trust fund to cover the recurring costs 
of long-term surveillance and control for license termination under 
restricted release criteria may be inadequate if it is based on a high 
assumed rate of return for the trust fund. To address this problem, the 
NRC proposes to amend 10 CFR 20.1403 to require that licensees assume 
only a 1 percent real rate of return in establishing the initial 
funding amount.

H. Why Is 10 CFR 50.82 Being Amended?

    Several power reactor licensees have successfully decommissioned 
their reactor sites consistent with 10 CFR part 20 requirements. In 
some cases, reactor decommissioning costs have exceeded the initial 
decommissioning cost estimate. For example, the Connecticut Yankee 
Nuclear Plant experienced higher decommissioning costs than planned, 
due in part to a larger volume of contaminated soil than was identified 
in the initial site characterization.
    In the past, NRC has not required licensees to submit details of 
decommissioning costs on grounds that the typical reactor licensee was 
part of a public utility with access to substantial assets and revenues 
and that the minimum required amount for decommissioning financial 
assurance was adequate. A licensee's status as a regulated public 
utility provided access to cost of service rate recovery to help 
provide additional funds. A public utility had access to sales revenues 
to fund its obligations, even if rate recovery was limited.
    Deregulation of the electric industry now permits a reactor 
licensee to operate as a merchant plant not subject to rate regulation 
or rate recovery of costs of service. When it ceases operation, it may 
have no sales revenues. The licensee may be organized as a separate 
company or a subsidiary of a holding company to isolate the risks and 
rewards of selling electricity on the open market. Without access to 
rate relief, no sales revenues, and with the licensee's owner protected 
by limited liability, shortfalls in decommissioning funding may 
jeopardize timely completion of decommissioning. Additional oversight 
is necessary to assure that the licensee anticipates potential 
shortfalls and takes steps to control costs to stay within its budget 
or obtain additional funds.

I. What Changes Are Being Proposed to 10 CFR 20.1406?

    New 10 CFR 20.1406(c) states as follows:

    (c) Licensees shall, to the extent practical, conduct operations 
to minimize the introduction of residual radioactivity into the 
site, including the subsurface, in accordance with the existing 
radiation protection requirements in Subpart B and radiological 
criteria for license termination in Subpart E of this part.

    The term ``to the extent practical'' is intended to limit the scope 
of this provision to actions that are already manifested in practice or 
action. The same phrase is used in existing 10 CFR 20.1101(b), which 
requires that licensees keep occupational and public radiological doses 
to ALARA levels. Draft regulatory guidance released with this proposed 
rule specifies that the intent of the proposed rule is to address 
amounts of residual radioactivity at a site that are significant to 
achieve effective decommissioning planning. For operating facilities, 
these events result in residual radioactivity in a quantity that would 
later require remediation during decommissioning to meet the 
unrestricted use criteria of 10 CFR 20.1402.
    The current 10 CFR 20.1101 requirements are related to those in 
proposed 10 CFR 20.1406(c). Section 20.1101(a) requires each licensee 
to implement a radiation protection program to ensure compliance with 
the regulations in 10 CFR part 20. The current 10 CFR 20.1101(b) 
requires each licensee to use, to the extent practical, procedures and 
engineering controls based upon sound radiation protection principles 
to achieve occupational doses and doses to members of the public that 
are ALARA. To achieve doses that are ALARA during facility operations 
and decommissioning, the Sec.  20.1101(b) operating procedures and 
controls must apply to potential radiological hazards and to methods 
used by the licensee to minimize and control waste generation.
    In furtherance of these existing requirements, the new 10 CFR 
20.1406(c) includes the term ``residual radioactivity,'' as discussed 
previously in Section II.A. This new section would apply to current 
licensee operations, in contrast to the Sec.  20.1406(a) and (b) 
requirements which are imposed on license applicants. Residual 
radioactivity excludes background radiation. All licensees with 
operating facilities must have performed an assessment of background 
radiation prior to operating their facility, to be compliant with the 
requirements in 10 CFR 20.1301(a)(1).
    The proposed rule's use of the term ``subsurface'' designates the 
area below the surface by at least 15 centimeters, as defined in NUREG-
1575, ``Multi-Agency Radiation Survey and Site Investigation Manual.'' 
Under current regulations, residual radioactivity that enters the 
ground at a site may go undetected because there are generally no NRC 
requirements to monitor the

[[Page 3820]]

ground water onsite for contamination. Based on past NRC experience, 
significant concentrations or quantities of undetected and unmonitored 
contamination, caused primarily by subsurface migration or ground 
water, has been a major contributor to a site becoming a legacy site 
and a potential radiological hazard.
    Several hundred NRC materials licensees possess radioactive 
material and have liquid processes that could cause subsurface 
contamination. These licensees generally are compliant with regulations 
that limit effluent release to the environment over a specified time. 
Some of these licensees may not have documented onsite residual 
radioactivity, such as spills, leaks and onsite burials that may be 
costly to remediate during decommissioning and should be considered in 
arriving at an accurate decommissioning cost estimate. There have been 
instances of previously unidentified soil and ground-water 
contamination at uranium recovery and rare earth sites undergoing 
decommissioning in several states, notably Colorado and Pennsylvania. 
Two contributing factors to the accumulation of unidentified subsurface 
contamination is reluctance among some licensees to spend funds during 
operations to perform surveys and document spills and leaks that may 
affect site characterization, and to implement procedures for waste 
minimization.
    The vast majority of NRC materials licensees do not have processes 
that would cause subsurface contamination. NRC's expectation is that 
these licensees, including those that release and monitor effluents of 
short-lived radionuclides to municipal sewer systems, will not be 
impacted by 10 CFR 20.1406(c). The accumulation of radionuclides at 
municipal waste treatment facilities was the subject of an Interagency 
Steering Committee on Radiation Standards (ISCORS) study (NUREG-1775, 
November 2003, ADAMS accession number ML033140171), which concluded 
that these facilities do not have significant concentrations of long-
lived radionuclides. Other classes of licensees that are, in general, 
not expected to introduce significant residual radioactivity into the 
subsurface include broad scope academic, broad scope medical, and small 
research and test reactors (less than 1 MWt). The draft regulatory 
guidance released concurrently with this proposed rule describes an 
acceptable method for these licensees to confirm the absence of 
subsurface contamination at their facility.
    Power reactor licensees have exhibited a high level of ALARA 
discipline with respect to effluent release and known spills and leaks. 
Current NRC regulations in Sec. Sec.  20.1301, 20.1302 and 50.36a 
ensure that power reactor licensees maintain adequate monitoring and 
surveys of radioactive effluent discharges, with annual reporting 
requirements outlined in Sec.  50.36a(2) that are made available to the 
public on the NRC web site at https://www.reirs.com/effluent/. Several 
nuclear power plants recently reported abnormal releases of liquid 
tritium, which resulted in ground-water contamination. To address this 
issue, the Nuclear Energy Institute (NEI) developed voluntary guidance 
for licensees in the Industry Ground Water Protection Initiative (GPI). 
The voluntary GPI, planned for implementation by all licensed power 
reactors as of September 2008, is a site-specific ground water 
protection program to manage situations involving inadvertent releases 
of licensed material to ground water and to provide informal 
communication to appropriate State/Local officials, with follow-up 
notification to the NRC as appropriate. On May 5, 2006, the NRC staff 
issued a revised baseline inspection module (Procedure 71122.01) used 
to inspect leaks and spills at power reactor sites.

J. What Surveys Are Required Under Proposed Changes to 10 CFR 
20.1501(a)?

    Existing Sec.  20.1501(a) requires licensees to perform surveys 
necessary to comply with part 20 requirements, including surveys 
reasonable under the circumstances to evaluate potential radiological 
hazards. Slow and long-lasting leaks of radioactive material into the 
onsite subsurface may eventually produce radiological hazards and pose 
a risk for creation of a legacy site if contaminant characteristics are 
not id