4.	NUCLEAR PLANT

KCP&L owns 47% of Wolf Creek Generating Station (Wolf Creek), its only nuclear generating unit. Wolf Creek is located in Coffey County, Kansas, just northeast of Burlington, Kansas. Wolf Creek’s operating license expires in 2045. Wolf Creek is regulated by the Nuclear Regulatory Commission (NRC), with respect to licensing, operations and safety-related requirements. Wolf Creek had been on a status that called for heightened NRC oversight. In May 2011, the NRC moved Wolf Creek back to the lowest level of NRC oversight.

In March 2011, the NRC established a task force to conduct a 90-day review and a longer-term review of U.S. nuclear power plant safety in the aftermath of a March 11, 2011, earthquake and tsunami that eventually resulted in station blackout and a level 7 event on the International Nuclear and Radiological Event Scale (the highest level event on the scale) at Japan’s Fukushima Daiichi nuclear power plant. On July 12, 2011, the task force issued an extensive report on the ramifications of the Fukushima earthquake/tsunami for nuclear power plant regulation in the U.S. The report confirms the safety of nuclear plants in the U.S., but also contains several recommendations to enhance nuclear plant safety and preparedness to manage severe events. The NRC will begin systematically reviewing the report and recommendations through their regulatory process. The timing and effects of any NRC action cannot be determined at this time.

Spent Nuclear Fuel and High-Level Radioactive Waste

Under the Nuclear Waste Policy Act of 1982, the Department of Energy (DOE) is responsible for the permanent disposal of spent nuclear fuel. KCP&L pays the DOE a quarterly fee of one-tenth of a cent for each kWh of net nuclear generation delivered and sold for the future disposal of spent nuclear fuel. These disposal costs are charged to fuel expense. In March 2010, the DOE filed a motion to withdraw its application to the NRC to construct a national repository for the disposal of spent nuclear fuel and high-level radioactive waste at Yucca Mountain, Nevada, which would bring the licensing process to an end. An NRC board denied the DOE’s motion to withdraw its application in June 2010, and the DOE appealed that decision to the full NRC in July 2010. The NRC has not yet decided that appeal. Additional lawsuits had been filed questioning the DOE’s legal authority to withdraw its license application but on July 1, 2011, a federal appellate court dismissed the lawsuits. Wolf Creek has an on-site storage facility designed to hold all spent fuel generated at the plant through 2025, and believes it will be able to expand on-site storage as needed past 2025. Management cannot predict when, or if, an alternative disposal site will be available to receive Wolf Creek’s spent nuclear fuel and will continue to monitor this activity. See Note 11 for a related legal proceeding.

Low-Level Radioactive Waste

Wolf Creek disposes of most of its low-level radioactive waste (Class A waste) at an existing third-party repository in Utah. Management expects that the site located in Utah will remain available to Wolf Creek for disposal of its Class A waste. Wolf Creek has contracted with a waste processor that will process, take title and store in another state most of the remainder of Wolf Creek’s low-level radioactive waste (Classes B and C waste, which is higher in radioactivity but much lower in volume). Should on-site waste storage be needed in the future, Wolf Creek has current storage capacity on site for about four years’ generation of Classes B and C waste and believes it will be able to expand that storage capacity as needed if it becomes necessary to do so.

Nuclear Decommissioning Trust Fund

The following table summarizes the change in Great Plains Energy’s and KCP&L’s nuclear decommissioning trust fund.


	June 30		December 31
	2011		2010
Decommissioning Trust	(millions)
Beginning balance January 1	$	129.2	$	112.5
Contributions		1.7		3.7
Earned income, net of fees		3.4		2.0
Net realized gains		0.1		6.7
Net unrealized gains		3.8		4.3
Ending balance	$	138.2	$	129.2

The nuclear decommissioning trust is reported at fair value on the balance sheets and is invested in assets as detailed in the following table.


	June 30									December 31
	2011									2010
	Cost		Unrealized		Unrealized			Fair		Cost		Unrealized		Unrealized			Fair
	Basis		Gains		Losses			Value		Basis		Gains		Losses			Value
	(millions)
Equity securities	$	73.7	$	17.1	$	(1.4	)	$	89.4	$	73.4	$	13.1	$	(1.0	)	$	85.5
Debt securities		41.8		2.8		(0.1	)		44.5		38.1		2.6		(0.1	)		40.6
Other		4.3		-		-			4.3		3.1		-		-			3.1
Total	$	119.8	$	19.9	$	(1.5	)	$	138.2	$	114.6	$	15.7	$	(1.1	)	$	129.2

The weighted average maturity of debt securities held by the trust at June 30, 2011, was approximately 7.5 years. The costs of securities sold are determined on the basis of specific identification. The following table summarizes the realized gains and losses from the sale of securities by the nuclear decommissioning trust fund.


	Three Months Ended						Year to Date
	June 30						June 30
	2011			2010			2011			2010
	(millions)
Realized gains	$	0.7		$	0.2		$	0.8		$	7.0
Realized losses		(0.7	)		(0.1	)		(0.7	)		(0.5	)