13june01...1604eba

2001 SESSION

01-0386

03/10

HOUSE BILL 740

COMMITTEE: Science, Technology and Energy

ANALYSIS

This bill makes a variety of changes to the decommissioning of nuclear electric generating facilities laws, including the laws governing the funding and administration of nuclear decommissioning financing funds.

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Explanation: Matter added to current law appears in bold italics.

Matter removed from current law appears [in brackets and struckthrough.]

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

13june01...1604eba

01-0386

03/10

STATE OF NEW HAMPSHIRE

In the Year of Our Lord Two Thousand One

Be it Enacted by the Senate and House of Representatives in General Court convened:

193:1 Purpose. The purpose of this act is to:

I. Continue the role of the nuclear decommissioning financing committee in assuring that adequate funding will be available when a nuclear electric generating facility must be decommissioned;

II. Protect the health and safety of the public and the economic interest of New Hampshire citizens;

III. Increase the value of the interests in the Seabrook Station that are sold as part of the electric utility restructuring of Public Service Company of New Hampshire, New Hampshire Electric Cooperative, and Granite State Electric Company;

IV. Make any new owner of Seabrook Station solely responsible for that owner's proportionate share of decommissioning costs;

V. Require any new owner of Seabrook Station to provide assurance that sufficient assets will be available and forthcoming to pay that owner's proportionate share of the full decommissioning costs of Seabrook Station, including in the event the facility permanently ceases operation prior to the complete funding of the nuclear decommissioning financing fund;

VI. Specify that the standard to which Seabrook Station shall be decommissioned is to a level suitable for non-nuclear commercial, industrial, or other similar use, consistent with the orderly development of the region with due consideration having been given to the views of municipal and regional planning commissions and municipal governing bodies, while meeting all state and federal health and safety requirements, including the Nuclear Regulatory Commission's radiological standards for unrestricted use of the site;

VII. Recognize that the cost of demolition and removal of facilities constructed as part of Seabrook Station Unit 2 are not included in the decommissioning fund, that the costs remain the sole responsibility of the owners of that property, and that the state shall have no financial responsibility for such costs; and

VIII. Provide that existing owners of Seabrook Station, which do not elect to transfer their ownership interest, are not adversely affected when other owners transfer their ownership interests.

193:2 Radioactive Waste Consultation; Prohibition. Amend RSA 125:77-b to read as follows:

125:77-b Prohibition. No person shall receive, store, or dispose of radioactive waste or spent nuclear fuel in the state or within the coastal jurisdiction of the state. Nothing in this subdivision shall be construed to prohibit the use or interim on-site storage of [spent] nuclear fuel [rods nor] or spent fuel, or in any way to abrogate or amend [the] an agreement entered into between the state and the United States Atomic Energy Commission, or its successor, pursuant to section 274 of the Atomic Energy Act of 1954 as amended[; provided, however, under]. Under no circumstances shall spent nuclear fuel [rods from any other plant or storage facility], originating from any location other than Seabrook Station, be received for on-site storage within the state.

193:3 Decommissioning Responsibility. Amend RSA 162-F:1 to read as follows:

162-F:1 Decommissioning Responsibility. The legislature recognizes that in order to ensure the health, safety, and well-being of the public and of current and future generations, a costly and comprehensive decommissioning procedure is necessary at the end of the useful or serviceable life of nuclear electric generating facilities. Because the costs are substantial and because these costs are the direct and predictable result of operating such a facility and should not have to be borne by the state, it is found to be in the public interest to require that adequate fiscal responsibility be established to ensure proper and safe decommissioning, and also to ensure subsequent surveillance of a nuclear reactor [sites] site to the extent necessary to prevent such sites from constituting a hazard to current or future generations. The legislature, therefore, hereby establishes a procedure [which] that will provide assurance of adequate funding by [utilities] each owner of a facility for [the] decommissioning [of those nuclear electric generating facilities which complete their anticipated energy-producing lives].

193:4 Decommissioning of Nuclear Electric Generating Facilities; Definitions. Amend RSA 162-F:14 to read as follows:

162-F:14 Definitions. As used in this chapter:

I. "Committee" means a nuclear decommissioning financing committee established pursuant to RSA 162-F:15.

II. "Decommissioning [of a nuclear electric generating facility]" means, but is not limited to, any or all of the following, as may be required by any federal or state agency with jurisdiction, when any radioactive portion of the facility is permanently removed from service:

(a) [Removal, relocation, shipment, containment, demolition, dismantling or storage or a combination thereof of any radioactive equipment, materials, nuclear wastes or contaminated structures and future and present storage of radioactive debris.] Safe removal of the land, facility, or site from service, including, but not limited to, decontamination, stabilization, removal, relocation, shipment, containment, demolition, dismantling, or storage, or a combination thereof, of any buildings, structures, systems, components, materials, or debris containing activation products or radioactive contamination. This includes reduction of residual radioactivity to a level that permits release by the Nuclear Regulatory Commission of the property including land and structures for unrestricted use, and termination of the license issued by the Nuclear Regulatory Commission. Included is the removal of nuclear fuel, removal of the reactor containment building, and the dismantling of non-contaminated components required to obtain access to contaminated components.

(b) Restoration and rehabilitation of any site, including the physical and aesthetic appearance of the [decommissioning] site, that is subject to the requirements of subparagraph II(a) to permit non-nuclear commercial, industrial, or other similar use, consistent with the orderly development of the region with due consideration having been given to the views of municipal and regional planning commissions and municipal governing bodies.

(c) Perpetual, continual control or surveillance of land and structures that the Nuclear Regulatory Commission has not released for unrestricted use.

III. "Electric utility" means any entity that generates or distributes electricity and which recovers the cost of this electricity, either directly or indirectly, through rates established by the entity itself or by a separate regulatory authority. Investor-owned utilities, including generation or distribution subsidiaries, public utility districts, municipalities, rural electric cooperatives, and state and federal agencies, including associations of any of the foregoing, are included within the meaning of "electric utility."

IV. "Facility" means any nuclear electric generating facility subject to decommissioning pursuant to this chapter.

[IV] V. "Fund" means a nuclear decommissioning financing fund established pursuant to RSA 162-F:19.

[V. "Lead company" means the utility designated by the owner or owners of the facility.]

VI. "Funding assurance" means any prepayment, external sinking funds, parental or self-guarantee, insurance, bonds, letters of credit, form of surety, long-term power sales contract, or other method, or combination of methods approved by the committee, that, in the aggregate, meets or exceeds the decommissioning funding requirements established by the committee.

VII. "Funding date" means the date established by the committee at which time the fund shall have sufficient moneys to complete decommissioning.

VIII. "Non-utility" means any entity owning or proposing to own an interest in a nuclear electric generating facility, other than an electric utility.

IX. "Projected cost of decommissioning" means the amount, as determined by the committee, that is required to fully fund the cost of decommissioning a facility.

193:5 Decommissioning of Nuclear Electric Generating Facilities; Committee Established. Amend RSA 162-F:15 to read as follows:

162-F:15 Committee Established.

I. A nuclear decommissioning financing committee shall be established for each [nuclear electric generating] facility [which is required to be approved under this chapter]. The committee shall have jurisdiction to determine the projected cost of decommissioning the facility and the schedule of payments for each owner. The committee shall have jurisdiction to determine what decommissioning is required. The radiological standards of the Nuclear Regulatory Commission shall apply for purposes of releasing the site for unrestricted use.

II. Each committee shall consist of one person who is a resident of the town or city in which the facility is [to be] located and who shall be appointed by the selectmen of the town or the mayor and council of the city, the chairman of the public utilities commission, one senator, to be appointed by the senate president, one house member, to be appointed by the speaker of the house of representatives, the state treasurer or designee, the commissioner of the department of health and human services or designee, the commissioner of the department of safety or designee, and the director of the governor's office of energy and community services or designee.

III. The person appointed by the selectmen of the town or the mayor and council of the city shall serve a 3-year term and any vacancy shall be filled for the unexpired term in the same manner as the original appointment. In the event that more than one facility is licensed to be built in the state, the committee as designated in RSA 162-F:15, II shall serve in the same capacity, except that the appointed member who is a resident of the city or town shall be selected in the manner prescribed by this section.

193:6 Decommissioning of Nuclear Electric Generating Facilities; Organization of Committees. RSA 162-F:17 is repealed and reenacted to read as follows:

162-F:17 Organization of Committees.

I. The temporary chairman of each committee formed, who shall be the chairman of the public utilities commission, shall call an organizational meeting within 90 days of formation. At the organizational meeting, the committee shall select a chairman to serve for a 3-year term, elect such other officers as the members shall determine, and establish a schedule of meetings for determining the requirements of the decommissioning fund.

II. Each committee may hire such temporary help, including consultants, as it deems necessary to carry out its duties under this chapter. The committee shall establish an amount to be paid to the resident member of the committee for each day actually engaged in the duties of the committee.

193:7 Decommissioning of Nuclear Electric Generating Facilities; Expenses of Committee. Amend RSA 162-F:18 to read as follows:

162-F:18 Expenses of Committee. The reasonable expenses of each committee[,] and the office of the attorney general, including the services of [a consultant] consultants, and clerical and technical assistance, shall [after approval by the public utilities commission] be a direct charge against the owner or owners of the facility.

193:8 Decommissioning of Nuclear Electric Generating Facilities; Fund, Schedule of Payments Established. RSA 162-F:19 is repealed and reenacted to read as follows:

162-F:19 Fund; Schedule of Payment Established.

I. A separate nuclear decommissioning financing fund, with a separate account for each owner, shall be established in the office of the state treasurer for each facility in the state. The committee shall determine the projected cost of decommissioning, the funding date, and the schedule of payments sufficient to ensure that the full cost of decommissioning shall be met by the funding date. The moneys in such fund shall not be subject to any state taxes and shall not be subject to any federal taxes to the extent allowed by applicable federal law.

II. Each owner shall be separately liable for its proportional share, based on its ownership interest, of the cost of decommissioning the facility. The state shall have no financial responsibility for decommissioning, or the demolition and removal of facilities constructed as part of any uncompleted facility.

III. The committee shall establish a schedule for payments of moneys into the fund for each owner of the facility that shall not be less than necessary to reach the projected cost of decommissioning, as determined by the committee. The schedule of payments shall be based upon the funding date established by the committee and the owner's individual funding requirement.

IV. When the committee determines that the owner has provided funding assurance sufficient to ensure payment of the owner's proportionate share of the full decommissioning cost of the facility, including full funding for decommissioning in the event of a premature permanent cessation of operation, the committee may then establish a schedule of payments for that owner, which shall be collected over a period of time not to exceed the remaining license life of the facility. Any such schedule of payments shall be in lieu of a schedule of payments based on the funding date.

193:9 Decommissioning of Nuclear Electric Generating Facilities; Funding Amount Established, Report, Public Hearing. Amend RSA 162-F:21 to read as follows:

162-F:21 Funding [Requirements] Amount Established; Report; Public Hearing.

I. Each committee shall hold at least one public hearing to receive information on funding requirements for each fund. The committee shall have the authority to subpoena witnesses and administer oaths and to compel by subpoena duces tecum the production of any accounts, books, contracts, records, documents, memoranda, and papers in order to determine the amount needed for the fund.

II. The amount of the fund shall be sufficient to cover all costs of decommissioning the facility [when carried out by methods which have been proven to be workable and capable of achieving and maintaining the level of decommissioning required by the United States Nuclear Regulatory Commission or its successor organization, or] to standards set by any state agency with jurisdiction over decommissioning [which] that are not less stringent than those [levels] standards set by the [United States] Nuclear Regulatory Commission.

III. Each committee shall rely on all available data and experience in determining the amount of such fund including, but not limited to, information from the [United States] Nuclear Regulatory Commission [or its successor organization]; the public utilities commission; the owner or owners of the facility; [counsel for the public appointed under RSA 162-F:9; counsel for the legislative utility consumers council] municipal and regional planning commissions and municipal governing bodies; and relevant construction cost indices. The committee shall publish a transcript of all proceedings during which information was presented or offered into testimony, and a detailed analysis of the facts and figures used in determining the amount of the fund.

IV. Following the committee's deliberation and prior to final hearing, the plan for scheduled payments into the fund and relevant evidence, including the transcripts and analysis published pursuant to RSA 162-F:21, III, shall be available for public review in the clerk's office of the city or town where the facility is located and in the office of the public utilities commission at least 30 days prior to the one or more public hearings on the committee's proposed plan. At least one hearing shall be held in the city or town where the facility is located. A notice of the time and place of each hearing shall be posted in 2 appropriate public places in the city or town where the facility is located and shall be printed at least twice in a newspaper of general circulation for that city or town and in a newspaper of state-wide circulation 2 weeks prior to each hearing. Testimony presented at the hearings held pursuant to this paragraph shall be taken into consideration by the committee when [they formalize] it formalizes the payment schedule plan. All testimony shall be transcribed and made a permanent record.

193:10 New Sections; Changes in Ownership; Customer Nuclear Decommissioning Charge; Funding Assurance. Amend RSA 162-F by inserting after section 21 the following new sections:

162-F:21-a Changes in Ownership.

I. At the time a non-utility acquires an ownership interest in a facility, sufficient moneys shall have been paid into the fund, so that the balance of the fund for that ownership interest shall equal or exceed the minimum decommissioning funding requirements of the Nuclear Regulatory Commission for that ownership interest by the funding date.

II. Prior to acquiring an ownership interest in a facility, an electric utility or non-utility shall demonstrate its ability to provide the funding assurance required by the committee, as provided in RSA 162-F:21-c.

III. The funding assurance:

(a) Method or methods, level, and adequacy must be approved by a final order of the committee prior to such electric utility or non-utility acquiring an ownership interest in a facility.

(b) Shall be in effect from the date the electric utility or non-utility acquires an ownership interest in the facility, until the date of license termination by the Nuclear Regulatory Commission and completion of decommissioning required by the committee and, upon the request of the committee, shall be payable directly into the fund.

162-F:21-b Customer Nuclear Decommissioning Charge.

I. The public utilities commission shall permit an electric utility with a franchise territory in the state to charge its customers on a per kilowatt hour basis the amount it pays directly into the fund, as required by the committee pursuant to a schedule of payments established under this chapter. The amount of the per kilowatt hour charges to utility customers shall be reviewed and approved by the public utilities commission. The charge, as approved by the public utilities commission, shall be designated a nuclear decommissioning charge and shall be separately stated on the customer's billing statement. Customer financial responsibility for decommissioning is limited solely to moneys paid into the fund pursuant to a nuclear decommissioning charge approved by the public utilities commission under this section.

II.(a) Any nuclear decommissioning charge included on utility customers' billing statements shall be discontinued within 30 days if:

(1) The permanent cessation of a facility's operations occurs;

(2) The owner or owners voluntarily cease to generate electricity for more than 6 months, other than for scheduled or unscheduled repairs;

(3) The public utilities commission finds that the facility is no longer generating electric energy, and that decommissioning of the facility should be commenced; or

(4) The electric utility transfers its ownership interest.

(b) If the customer nuclear decommissioning charge for an electric utility is discontinued, the committee may institute a revised schedule for funding requirements to cover the costs of decommissioning. The revised funding schedule may include payments made by the owner or owners separate from customer charges. The committee shall hold at least one public hearing relative to establishing the revised funding schedule, consistent with the public hearing requirements established in RSA 162-F:21. All testimony shall be transcribed and made a permanent record.

(c) Upon the discontinuation of a customer nuclear decommissioning charge due to the transfer by a utility of an ownership interest occurring after January 1, 2001, the committee shall determine the portion of the fund contributed by New Hampshire customers of the electric utility, including interest and earnings as of the date of ownership transfer, and designate that portion of the fund as the customer contribution. If decommissioning is completed for less than the customer contribution, the excess shall be refunded to customers in a manner determined by the public utilities commission.

162-F:21-c Funding Assurance. Funding assurances shall be sufficient to fully fund the projected cost of decommissioning the facility by the funding date, including in the event of a premature permanent cessation of operation. The committee shall determine the adequacy of the method or methods, and the level of each owner's funding assurance. The amount available to the fund for each owner shall be sufficient to cover that owner's share of the full cost of decommissioning by the funding date.

193:11 Changes to the Fund, Payment Schedule, Funding Assurance; Use of Fund. RSA 162-F:22-23 are repealed and reenacted to read as follows:

162-F:22 Changes to the Fund; Payment Schedule; Funding Assurance.

I. Every 4 years the committee shall meet to review the fund and may increase or decrease the projected cost of decommissioning the facility and the schedule of payments into the fund. Reasons for increasing or decreasing the projected cost of decommissioning and schedule of payments include, but are not limited to, changes in owner or owners, the financial condition of an owner or owners, need, safety, reliability, technology, or other changes in circumstances.

II. The committee shall meet at least once each calendar year to review the cumulative fund performance and each funding assurance in place pursuant to an order of the committee, and the committee may alter the payment schedule, or require a change in any funding assurance to ensure adequate funding by each owner of its decommissioning obligation.

III. At any time the committee may meet to determine whether the amount of the fund, schedule of payments, or any funding assurance in place pursuant to an order of the committee shall be increased, decreased, or otherwise altered for reasons including changes in owner or owners, the financial condition of an owner or owners, need, safety, reliability, technology, or other changes in circumstances.

IV. Prepayment of a funding obligation by an owner or owners, or the payment of the minimum decommissioning funding requirements of the Nuclear Regulatory Commission pursuant to RSA 162-F:21-a, shall not require another owner to make such a payment.

V. Prior to altering the projected cost of decommissioning the facility, the committee shall hold at least one public hearing in the city or town where the facility is located. All testimony shall be transcribed and made a permanent record. Prior to changing the projected cost of decommissioning or imposing a funding assurance requirement for an ownership interest, the committee shall conduct an adjudicative proceeding. Prior to the transfer of an ownership interest the committee may, by a non-adjudicative proceeding, approve proposed funding assurances and make any necessary associated changes to a schedule of payments to reflect the approved funding assurances.

162-F:23 Use of Fund.

I. Expenditures from the fund shall be limited to decommissioning of the facility for which the fund was established. The committee shall review all expenditures from such fund during actual decommissioning to confirm that utilization of the fund is in accordance with the requirements of the committee and the Nuclear Regulatory Commission, and that the state and federal tax status of the fund is maintained.

II. Prior to withdrawal of moneys from the fund for decommissioning activities, the committee shall be provided with, and must approve, a summary of decommissioning actions to be taken, including the schedule for taking such actions. Fund withdrawals other than those allowed by the Nuclear Regulatory Commission may be used only for expenses associated with legitimate decommissioning activities, consistent with the definition of decommissioning in RSA 162-F:14, II, and may not inhibit the ability to complete funding of all required decommissioning activities. There shall be no decommissioning activities performed that foreclose release of the site for possible unrestricted use, result in significant unreviewed environmental impacts, or result in there no longer being reasonable assurance that adequate funds will be available for decommissioning. If perpetual, continual control or surveillance of a facility is necessary, the fund shall be maintained at a level sufficient to yield income to maintain such control or surveillance.

III. Any fund amount remaining after completion of decommissioning as determined by the committee and after the date of license termination by the Nuclear Regulatory Commission, in excess of the customer contribution as accounted for in RSA 162-F:21-b, II(c), shall be returned to the owner or owners of the facility.

193:12 Enforcement; Penalty. Amend RSA 162-F:24-25 to read as follows:

162-F:24 Enforcement. The superior court may enjoin any act in violation of a determination of a nuclear decommissioning financing committee, or it may require the owner or owners to comply with any determination or order of such committee. Failure by an owner to make the payments or maintain the funding assurance required by this chapter and established by order of the committee shall create a debt owing to the state [which] that may be collected or enforced by the attorney general in an action at law. If any owner fails to pay any judgment ordered by a court of competent jurisdiction, the attorney general may levy against the property of such owner to satisfy such judgment.

162-F:25 Penalty. Any person who [wilfully] willfully violates any order or determination of a committee shall be guilty of a [misdemeanor if a natural person, or guilty of a] felony [if any other person].

193:13 New Section; Decommissioning of Nuclear Electric Generating Facilities; Prior Approvals. Amend RSA 162-F by inserting after section 26 the following new section:

162-F:27 Prior Approvals. Nothing in this chapter shall limit the recovery of any decommissioning costs allowed in a stranded cost recovery charge approved pursuant to RSA 374-F by the public utilities commission in an electric restructuring agreement or compliance filing, including charges from a wholesale contract termination stipulation and agreement approved by the Federal Energy Regulatory Commission prior to the effective date of this section.

193:14 Guarantee of Payment; Repeal; Contingency. Amend 1998, 164:4 to read as follows:

164:4 Contingency. Section 3 of this act shall take effect [30 days after the chairman of the nuclear decommissioning financing committee has certified to the secretary of state that comprehensive funding assurance for decommissioning has been implemented] upon the transfer by any joint owner of the facility without a franchise territory, as defined in section 2 of this act, of its interest in the facility. Within 30 days of the completion of such a transfer, the chairman of the nuclear decommissioning financing committee shall certify to the secretary of state that such a transfer is completed.

193:15 Committee Action. Within 30 days of the effective date of this section, the nuclear decommissioning financing committee shall commence a proceeding to establish a revised projection of the cost of decommissioning Seabrook Station Unit I to reflect the revised definition of decommissioning set forth in RSA 162-F:14, II, as amended, and, if appropriate, to revise the schedule of payments required in RSA 162-F:19, III, in order to address the amendments to RSA 162-F in this act.

193:16 Repeal. RSA 162-F:20, II, relative to overpayment to decommissioning fund, is repealed.

193:17 Effective Date.

I. Section 15 of this act shall take effect upon its passage.

(Approved: July 5, 2001)

(Effective Date: I. Section 15 shall take effect July 5, 2001