ComEd 2006 Annual Report Download - page 12

(a) The date for loss of full core reserve identifies when the on-site storage pool will no longer have sufficient space to receive a
full complement of fuel from the reactor core.
(b) Clinton has currently lost full core discharge capability. A modification to the on-site storage pool is in progress to increase
the amount of SNF that can be stored in the pool and is expected to be completed in late 2007. This will move the date for
loss of full core reserve at Clinton out to approximately 2012.
Under the Nuclear Waste Policy Act of 1982 (NWPA), the U.S. Department of Energy (DOE) is
responsible for the development of a repository for and the disposal of SNF and high-level radioactive
waste. As required by the NWPA, Generation is a party to contracts with the DOE (Standard Contracts)
to provide for disposal of SNF from its nuclear generating stations. In accordance with the NWPA and
the Standard Contracts, Generation pays the DOE one mill ($.001) per kilowatthour (kWh) of net
nuclear generation for the cost of SNF disposal. This fee may be adjusted prospectively in order to
ensure full cost recovery. The NWPA and the Standard Contracts required the DOE to begin taking
possession of SNF generated by nuclear generating units by no later than January 31, 1998. The
DOE, however, failed to meet that deadline and its performance will be delayed significantly. The DOE
has published a schedule for opening a SNF permanent disposal facility and its current estimate is
2017. This extended delay in SNF acceptance by the DOE has led to Generation's adoption of dry
cask storage at its Dresden, Quad Cities, Peach Bottom and Oyster Creek Stations and its
consideration of dry cask storage at other stations. Generation plans to submit annual reimbursement
requests to the DOE for costs associated with the storage of spent nuclear fuel. In all cases,
reimbursement requests will be made only after costs are incurred and only for costs resulting from
DOE delays in accepting the SNF. See Note 13 of the Combined Notes to Consolidated Financial
Statements for additional information regarding spent fuel storage claims and issues.
The Standard Contracts with the DOE also required the payment to the DOE of a one-time fee
applicable to nuclear generation through April 6, 1983. The fee related to the former PECO units has
been paid. Pursuant to the Standard Contracts, ComEd previously elected to defer payment of the
one-time fee of $277 million for its units (which are now part of Generation), with interest to the date of
payment, until just prior to the first delivery of SNF to the DOE. As of December 31, 2006, the
unfunded liability for the one-time fee with interest (which has been assumed by Generation) was $950
million. Interest accrues at the 13-week Treasury Rate. The 13-week Treasury Rate in effect, for
calculation of the interest accrual at December 31, 2006, was 5.108%. The outstanding one-time fee
obligation for the Oyster Creek and TMI units remains with the former owners. The Clinton Unit has no
outstanding obligation.
As a by-product of their operations, nuclear generating units produce low-level radioactive waste
(LLRW). LLRW is accumulated at each generating station and permanently disposed of at Federally
licensed disposal facilities. The Federal Low-Level Radioactive Waste Policy Act of 1980 provides that
states may enter into agreements to provide regional disposal facilities for LLRW and restrict use of
those facilities to waste generated within the region. Illinois and Kentucky have entered into an
agreement, although neither state currently has an operational site and none is currently expected to
be operational until after 2011. Pennsylvania, which had agreed to be the host site for LLRW disposal
facilities for generators located in Pennsylvania, Delaware, Maryland and West Virginia, has
suspended the search for a permanent disposal site.
Generation has temporary on-site storage capacity at its nuclear generation stations for limited
amounts of LLRW and has been shipping its LLRW to disposal facilities in South Carolina and Utah.
With a limited number of available LLRW disposal facilities, Generation anticipates the possibility of
continuing difficulties in disposing of LLRW. Generation continues to pursue alternative disposal
strategies for LLRW, including an LLRW reduction program to minimize cost impacts.
The National Energy Policy Act of 1992 requires that the owners of nuclear reactors pay for the
decommissioning and decontamination of the DOE uranium enrichment facilities. The total cost to all
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