Lacey Officials, Coalition of Residents Demand Public Hearing on Oyster Creek License Transfer

Nov 14, 2018

Financial and safety concerns are at the forefront of why Lacey Township officials want a public hearing on the license transfer for the now defunct Oyster Creek Nuclear Generating Station.

Township officials last week sent a petition for leave to intervene and a request for a public hearing to the Nuclear Regulatory Commission, which is reviewing an application that would allow Holtec International, a Camden-based company, to take over the decommissioning of the nuclear plant.

Lauren R. Staiger, the township attorney on the matter, said in the documents filed with the federal agency Nov. 8 township officials are “keenly interested in the decommissioning process” as well as the proposed license transfer to Oyster Creek Environmental Protection, LLC (OCEP) as the licensed owner and Holtec Decommissioning International, LLC (HDI) as the licensed operator.

“As the geographical host to Oyster Creek, the township and its residents have health, safety, and environmental and concerns related to the decommissioning and spent fuel storage,” according to the paperwork filed with the NRC Nov. 8, the final day to request a public hearing on the license transfer. “The township further has concerns related to the financial management of the decommissioning, as the township believes there are no guarantees that if there is a shortfall in the decommissioning fund for Oyster Creek that its residents will not be in some way responsible to make up the difference.”

NRC officials have placed the projected cost of decommissioning Oyster Creek, once the nation’s oldest operating commercial nuclear power plant, at around $1.4 billion. As of July, the decommissioning trust fund for Oyster Creek was approximately $945 million. Terming the shortfall significant, officials are seeking a full and detailed accounting, as well as a plan, for how the companies, both subsidiaries of Holtec International, will spend the money.

Just last month, the NRC approved an exemption request from Exelon Generation, which currently owns the power plant, to take money out of the decommissioning trust fund for spent nuclear fuel management and site restoration without prior approval from the federal agency. It's expected Holtec will file a similar request before the end of the year. The review would take approximately six months and Holtec officials wouldn't be able to touch the funds unless the license transfer is approved.

“The township is already facing reduced ratables through the closure of Oyster Creek. Having to assume the shortfall associated with decommissioning can have a crippling effect on its residents,” according to the petition. “OCEP and HDI have not presented enough evidence to the NRC, or the public, to provide financial assurance to meet the regulatory requirements for the proposed license transfers.”

The township is also concerned about SNC-Lavalin, a global professional service and project management company expected to play a key role in the decommissioning of Oyster Creek as its subsidiary Comprehensive Decommissioning International, LLC, a joint venture between HDI and SNC. In Canada, SNC has been charged with corruption, fraud and bribery.

“A company with a reputation such as SNC’s involvement in such an endeavor is troubling, at best,” according to the petition. “... The NRC should host a local hearing and have SNC answer to the public. SNC should address these charges publicly. If they are unable to effectively convince the NRC and public of its innocence in connection with those charges, and its overall trustworthiness, the license transfer should not be approved.”

Finally, the township is also troubled by any potential impact to the Barnegat Bay since the nuclear plant is located in close proximity and for nearly five decades used a branch of Oyster Creek as its cooling waters.

“The environmental concerns here go beyond the typical concerns associated with a nuclear power plant,” the petition states. “The Barnegat Bay ecological system is already extremely sensitive. Any mismanagement or mistake can result in significant negative impacts to this ecosystem.”

Some of that concern stems from the way HDI handled its involvement with the San Onofre Nuclear Generating Station, located south of San Clemente, Calif. In that situation, according to the township’s petition filed with the NRC, faulty casks for spent fuel nuclear storage were used.

“The Township and NRC must be assured that such mistakes will not occur in Oyster Creek,” the petition states. “The National Environmental Protection Act (NEPA) requires a hard look at the potential consequences to the environment from a requested action and the Township is not satisfied that such standards have been met. HDI should be required to revise and address these concerns to the public and the NRC should not permit the transfers until such proof has been proffered.”

Concerned Citizens of Lacey Coalition, headed by Chairman Ron Martyn, shares the same apprehension about the license transfer application. In fact, the coalition submitted a public hearing request to the NRC based on a near-identical agenda.

“We are a group of local residents, including professionals with diverse backgrounds and expertise in the fields of electric, gas, power generation, nuclear, engineering, environmental, permitting, regulatory affairs, financial regulation, accounting, logistics, and several other fields related to the closing of Oyster Creek and Exelon’s sale of the plant to Holtec International. We all reside in the Lacey Township community,” Martyn’s letter to the NRC states. “We support transparency and public involvement throughout the entire process in order to arrive at a positive outcome for Lacey and New Jersey.”

The Sierra Club of New Jersey also requested a public hearing on the license transfer, saying its members have questions about transparency, costs, liability and Holtec’s new dry cask storage technology.

In July, Exelon announced it reached a deal with Holtec to purchase Oyster Creek and take over its decommissioning responsibilities. Two weeks later, in a call with the NRC, Holtec officials highlighted their accelerated plans for decommissioning Oyster Creek including the use of a new cask design for storing still-hot spent nuclear fuel. It would cut the wait time by nearly half, company officials said at the time. Holtec’s timeline calls for this process to begin sometime next year with a 2021 completion date, and fuel removal from the site by 2034 and full license termination by 2035.

Oyster Creek permanently ceased operations in September, more than 14 months ahead of a deal with the state to avoid building cooling towers at the Route 9 site.

— Gina G. Scala

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