IR 05000528/2007201

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Enclosure contains Safeguards Information. Upon removal, this letter is decontrolled. October 05, 2007Mr. Randall K. EdingtonSenior Vice President Nuclear Palo Verde Nuclear Generating Station Arizona Public Service Co.

5801 S. Wintersburg Road Tonopah, AZ 85354-0003

SUBJECT: PALO VERDE NUCLEAR GENERATING STATION - SECURITY INSPECTION 05000528/2007201, 05000529/2007201 AND 05000530/2007201

Dear Mr. Edington:

On August 24, 2007, the U.S. Nuclear Regulatory Commission (NRC) completed a securitybaseline inspection at the Palo Verde Nuclear Generating Station. The inspection covered one or more of the key attributes of the security cornerstone of the NRC's Reactor Oversight Process. The enclosed inspection report documents the inspection results, which were discussed on August 24, 2007, with you and other members of your staff.The inspection examined activities conducted under your license as they relate to security andcompliance with the Commission's rules and regulations and with the conditions of your license.

The inspectors reviewed selected procedures and records, observed activities, and interviewed personnel. No findings of significance were identified. In accordance with 10 CFR 2.390 of the NRC's "Rules of Practice," a copy of this letter will beavailable electronically for public inspection in the NRC Public Document Room or from the Publicly Available Records (PARS) component of NRC's document system, ADAMS. ADAMS is accessible from the NRC Website at http://www.nrc.gov/reading-rm/adams.html (the PublicElectronic Reading Room). However, because of the security-related information contained inthe enclosure, and in accordance with 10 CFR 2.390, a copy of this letter's enclosure will not be available for public inspection. R. Edington-2 Should you have any questions concerning this letter, please contact us. Your cooperation isappreciated.

Sincerely,/RA/Ronald J. Albert, ChiefSecurity Performance Evaluation Branch Division of Security Operations Office of Nuclear Security and Incident Response Docket Nos.: 50-528, 50-529, 50-530 License Nos.: NPF-41, NPF-51, NPF-74

Enclosure:

NRC Inspection Report No. 05000528/2007201, 05000529/2007201 and05000530/2007201cc w/encl:Mr. Charles H. Coles, Department Leader, Security OperationsPalo Verde Nuclear Generating Station Arizona Public Service Co.

5801 S. Wintersburg Road Tonopah, AZ 85354-0003cc w/o encl:Mr. Edward A. O'Neill, Emergency Planning Program Department LeadPalo Verde Nuclear Generating Station Arizona Public Service Co.

5801 S. Wintersburg Road Tonopah, AZ 85354-0003Frank NavaretteHomeland Security Director Director of the Division of Emergency Management 1700 W. Washington Street, 3rd FloorPheonix, AZ 85007

Aubrey Godwin, Director Arizona Radiation Regulatory Agency 4814 South 40th StreetPheonix, AZ 85004