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Note: Private Fuel Storage, L.L.C., (Licensee) applied to the U.S. Nuclear Regulatory Commission Atomic Safety and Licensing Board (Board) under 10 C.F.R. Part 72 for a license to construct and operate a spent fuel storage facility within the state borders of Utah, U.S.A. After a hearing requested by the State of Utah before the Board, Bollwerk, ALJ., concluded that Licensee had established "reasonable assurance that it is financially qualified to decommission its proposed ... facility in a manner that would protect the public health and safety" because the facility's plan contained sufficient information as to the funding of the decommissioning of the facility.

To cover the costs of decommissioning the facility, Licensee had stated that it intended to obtain an LC in the amount of US$1,631,000.00. Utah contended that the proposed LC was not sufficient to satisfy the requirements of the rule because the LC had not been obtained and there was no assurance as to the terms of the LC or its irrevocability. The Administrative Law Judge concluded that the amount of the proposed LC was sufficient since the LC could be revised annually and adjusted. The Administrative Law Judge did not consider Utah's arguments about the terms of the LC, perhaps because an LC had been issued by River Bank of Wisconsin and its terms were before the Board. Since the LC would be for a period of time in which costs could rise, Licensee had also stated that a new LC in an increased amount would be obtained if necessary. Because there was a clause in the plan to require the facility's customers to pay for any shortage of the secured funds for decommission and standards were set for revision of expected costs, the Administrative Law Judge concluded that Licensee had met the requirement for annual revision and escalation of the cost estimates.

[JEB/krp]

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