ML19322D236

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Reconciling Regulation & Cost, Speech on 790924 Before AIF Intl Conference on Financing Nuclear Power in Coppenhagen,Denmark
ML19322D236
Person / Time
Site: Crane 
Issue date: 09/24/1979
From: Hendrie J
NRC COMMISSION (OCM)
To:
References
TASK-TF, TASK-TMR S-10-79, NUDOCS 8002100079
Download: ML19322D236 (3)


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" deems necessary or desarable to pro =ste the cenmen defense or to protect health or to minimite danger to life or hemarus t>y property." And an issuing an operating license, the Commission Chaiman Jonern M. Hendrie must find that the nuclear facility "will provide adequate U.S. Aclear Regalatory Comr.1 salon protection to the health and safety of the public.*

tefore the

' Atomic In ostrial Forum'a Khat is important here fer our discussion of the costs

,nternational Conference en Financing Kwelear Poner of regulatica is that the main thrust of the law is that we i

Copenhagen, Denmark are to protect the public health and safety. Both the September 2 % 1 H9 le islative and judicial history cf the Momic Energy Act PIO3C11.INO RE0%ATION A:C C0375 c rroborate the ccnclusion that for the M O, pictaction of the public health and safety--and not enhancement of the general pubile welfare -1s the decisive criterion in determining It was the first month of this year-January 4 to be the appropriateness of a regulation. But neither the Atomic oxact~that I received the invitation to meet with you today Energy Act nor decisions of the courts shed light on the and discuss the relation between costs and regulation. I exact nature of that protection, or identify the factors or eccepted the invitation and the topic at that time on the characteristics whose presence signifies proper protection speculation that I could say something useful on the subject.

of the public and whose absence denotes unreasonable risk.

Cf course 1 am still interested in your theme and your The discretionary authority of the Commission in this regard concerns, and I am pleased to have the chance to address is very extensive: Adequate protection means what the them here today. But I have to say that my interest back in Commission says it 'means, and we mean it to require a very January was not quite the same as my interest now is in high level of safety.

September, because nothing in the world of nuclear power generation is the same as it was before March 28, 1979.

Now where does all cf this leave us with regard to the costs of regulatory requirements?

A watershed event for nuclear power Las taken place.

Its implications for the future of nuclear power in the The Commission in effect defines the necessary level of United States, in Eurcpe, and throughost the world are only protection through the regulations that set various requirements justbeginningtoemerge. In the next few montns, several for nuclear plants. he can and do consider costs and related

.all scale reports on the Three Mile Island accident will be factors in our rulemaking, either explicitly through value-ferthcoming. These studies, which include those being impact analyses, or implacitly in the individual judgments carried out ty the industry itself, will prove invaluable of the Commissioners. But it is the improvement in safety and, I expect, critical to the future of nuclear power in that must be the do=ir. ant element in our censiderations. In the U.S.

a sir.ilar way the NRC Staff, in considering new generic requirements to implement the regulations, will generally 1 would propose at the outset that we meet to talk make a value-impact analysis. So we do take costs into about costs at a time when it is hard t3 think cf the cost account, at least in a linited way, in setting the general cf thorough, rigorous and effective regulation as excessive.

requirements to obtain a high safety level It has always been true-though never before so unmistakably true~ that your investment in prevention and protection is But when we come to apply these general requirements to an investment with high return. The true value of effective a specific matter, on a specific plant, costs and related regulation can only be measured in terms of the sole available factors do not count for much. Each plant must meet those alternative... the end of the nuclear power industry.

general requirements in order to be allowed to operate. Our purpose, after all, is to reduce the risk to the public, by The invitation of last January proposed that ! speak of appropriate regulation, to as low a level as we can reasonably the reconciliation of costs and regulation. The question, achieve at the time a facility is designed and constructed I take it, is do we regulators give sufficient consideration and to keep it there durang operation. That requires adherence to the financial impact of the regulations we impose? It is to the body of regulations with wl.ich all licensed plants a question upon which reasonable people can differ, and must corply. The regulations are not totally inflexible.

Senerally do.

Exemptions can be granted where it can be shown that the necessary level of safety can be maintained by some other Let me give a short answer to the cost question. he means. But in general, a plant that does not meet the regulate on the basis of protecting the public health and regulations cannot operate, and costs and other factors safety. In setting the standardi for that protection, we don't have much to do with it.

canTaxe some limitedWount of the costs but it is the protection that ts important and not the costs. And any You may recall that earlier this year, before Three safety measure that prevents even a minor plant upset will Mile Island, the Comnission shut dow, five plants because we have paid for itself many times over, had good reason to believe they were _n viciation of our requirements for protectica against earthquakes. Dose I should note that my remarks here are limited to the shutdowns were very costly to consumers in terms of the regulation of U.S. commercial nuclear plants, with no electricity the plants would otherwise have produced, and implications for ispirt export matters. I realize we have the shutdowns came in the middle of an acute oil and gasoline on international audience here today and some of yok may shortage. I subsequently was lectured at length in numerous have particular interest in the costs of export licensing, hearings before Congress en how high those costs were and on but that is a labyrinth I would prefer not to enter.

how the Commission was hurting the national energy policy of reducing oil consumption. But I thought it was the right The argument is often made that the law under which the decision then, and I still think so.

I don't believe we NRC operates requires that we look to the effect of our should relax safety standards simply because the costs or

. actions on the general public welfare in.fram1Pg regulations other effects of maintaining those standards are significant.

for nuclear power. Under this construction of the law, the NRC sust seek to protect the pubitC not only f rom undue ho discussion of the costs of regulation would be ho:ards related to nuclear power but also from undue expente complete without mention cf ratcheting--that is, the regulators' essociated with regulatory requirements. There is indeed inclination to iepose successively more stringent safety soas language in the Atomic Energy act, the law which provides requirements on new plants--and of backfitting cf new require-for regulation of civilian nuclear activities, that the ments to operating plants. If we consider that the plants control of this energy resource shall be exercised "so as to now operating meet current regulatiens, and thus, as a make tne maxim a contribution to the general welfare," and.

group, in principle represent the required level of safety adaan, to." improve the general welfare, increase the standard that is defined by the regulations, why do we have ratcheting of livang, and strengthen free coepetition in private enterprise."

and backfitting? I ww1J hope the answer is ot viaus u all of us.

he are still learning things about nuclear power pespite this preamble, the Atoric Energy Act, in setting technetegy, fron n e experience with cperating plants and out the ains and standards related to the issuance of licenses from safety researsL It schid be entirely incensistent.

and the regulation of licensees, concentrates on the protection.

with the purposes of regulatact to pretend that there are no J

of the public health and safety and the coemon defense and new developments and tr;rovements to be incorperated into securat. - Thus the Act says that the Commzssion is prohibited the design and construction cf newer facilities crer a from assuing any special nuclear material licenses if it period of time.

It would be irrational to i n te the finss stat such action would be " inimical to the commor, opportunities to raise the 1mels of safetv o thev are def ense and securtty or would constitute an unreasonable presented br new construction and te holJ te a% Utctnal risk to tne health and safety of the pubilc." Again, the staPJard that never chantes.

Hence.*we occassionally finJ Connassion as authorized to establish such standards regard!ng it necessary to radet new projects.

the possession and use of nuclear materials as the Constssion 800210.0O N

(

l Te s a e c:nal e ra:Icas am ;y *, ta:afi.* -

r.e w safety the fct ation ef team v: ids prica acn _ cere was recaire ents cr. eper.?.Ing plants. ahen we find hat changes unc:vered and extensive ca.w e m urrea, he fa cas N regen are neef i : m21 tal-the peste:*!:n se had previously tabtic, and sc :n.

The crerster pr:tlers ere c o*; : u*..e 4

  • hc %

mit 1 *: pla:c, or een we adentiiv new m a*

res t :.a t by instree F fal; ares and idiose:ra:1es, N some ei er en t s tycvidt sc ** -tic. siiiticnal ;t ct,e:* ;on an. are nccessa-of the aesign of the plant, and by n 1:le:.a es 11. tnear

'for safety,. ne y It d Oe made.

he take

.-te a;;oan* de training.

C,

ssts an :.ved in sa:' changes and we try t.

le:# carefu"ly fren a 52:vfit:1n,.

to see *.at the add.tiena; prete: :.

inere were etter things that

ened. -
  • as cru:aal, attion is rea; and s:rt J.lc.

H271n g d r r sc. wnere we but disturein; and revealin; It wa

<se e after the find ba:sfl.- r; as a;orcpriate, at nast ce uen and the enset c'

.he a: laent before 'n e c" % t o rs re;..:ed

  • hat
ests *.11 n m 10 re 50rne.

.a'er

- the cento.n-ent

, was "r.

y ta.

i bailding and everflowin; the taniage nere, and. the em. 11ary t was acre There rate alrealv been a ruebe r c f t ack f at

  • ng acti:ns hours before tne containmen was Isliy isol. tem.

And the recrired wa n re;ar. to both eaai rent and cperating procedures auxiliary f eed. ter bicci valves here :lered at the cnset cf as a result of the Three Male lsland a:c. den..

=an assure the a::1 dent That's a fa:t that ap;arent1v did nat hwe you that there will be cany more.

I an sure that some cf much te de with the severity of subsc uen eve-ts, but it those cninaes will de regarded with dismay in scme quarters.

mas a flat violation of the 12:ense w:nditle-far that 3.t consad.r.

bppase that a year or so ago be had been plant to be in operation with those ci valses closed.

bri;nt encug h, as he should have been, to recogni:e the 6.

potential problers i* allcwing the frequent lifting of the An irportant lesson is that cperator train ng has not primary rel:ef valves in the isat>co:k and h11cox plants. And been suf fi:lently rigorcus with resph* to

  • ranslerM er cff-sappose me had tncn recutred the changes we have, in fact, normal situaticns. uperatcrs, of coarse, are 11:ensed by required since Three Mlle Island. These include eliminating the n; and a good bit cf training and testing taxes p;a:e the lif ting cf these relief valves during seccndary system befere a license is granted. Sat
  • think we have simply transients, retraining PwF. operators to recogal:e the seaning failed to re::gnire that the eperators' re a d ir.e ? s to ceal cf saturation condita:ns for pressurizer level, and all the with *he unusual, and a frecuent retn':r:c en ef that other changes that have teen required to date.

There readines; ety tramn; with he rea::c-siniat:rs, are certainly w:uld have been additional costs involved in those essential elemen in the process. A substan*

4. upgrading chan;es, ar.d 1 *cA d not have beer. atle to point to a majer in operatcr training requirenents and in freasent retraining accident te prove that the changes were necessary. Bat what and requalification is necessary, a bargain it would have been.

A second lesson in this sate area is tr.e need to reassess Given the latited fratescrk within which we can ecnsider the makeup of operater tear.s or shif ts and the back-up the costs cf regalation, what can se do te impreve the engineering capability of licensee cc panies. One of the tife:tavenes s cf the process? Certainly we can improve the distur:Ing problens emerging in the ce:Istre early stages of raality of car valac-irpa:t analyses. A : lear-and mare the a::1 dent is that tne snail cperating s taff en that dawn e

specific en utatic*. cf the saf ety benefits of preposed shift *ecane priscners of the control pane!

they were charge in regulaticns or staf f pcsitacns, tcgetner with a instantly riveted to the switches and the g2 ages and nc cne tcre realistic ccs; estimate would improve the cecision-stood back, to take in the overall situaticn and comprehend raking prece ss in general However, I dcabt that this kind that has taking place.

It is clear that scne enlargenent of of ir.p r e v ene n t coald ever reach the point of preda:ing control room st 'fing should go along -ith ir;reve=ents.a uniforr satisfa:'lon for all parties. I suspect there woald operator trainin, te a general tenden:v of the regulaters to see cere safety teneilts and smaller ccsts in prcposed changes, and an equal A related area has to do with centre. roo arrangenents a: d cp;csz te tendeno cf licensees and applicants to see and instrurents 1cn.

The msst highly sillied an. trained snaller safety benefits and larger costs for tne same changes.

cperators are likely to make errcrs in a f ut-noving situation if their instrument readings are antigacus, cr if the instrument More generally, it is fair te recognize t.nat the present f rarework Of regnat.cn is a dif fi: alt one within which te displays are not gaickly and easily understccd. Finding schieve a f;.14 effs:ient assignnent of costs and safet, better havs to integrate and display the data that give the eenefits. he have, ever tre years, evcived a set of regalaticus.

operaters'a clear understanding of the plant cenditten is an

.e ecdify tnen and aid new regulations ;retty ma:h on a one-impcrtant step in assuring that operators vile respend

orre::1v 10 abncrmal situations, we are r.cring toward an at-a-tice basis. Tne saSe is true cf Npt: staff positions upgradiig in this.hele area, in:1udi-; imprcre e-ts in and guidan:e d::.J.er.t s arplementing the regulations. Ta ket water level Instrumentatien, dire:? Indicatica cf relief as a set the regulat' ens and staff doeurents attempt te de fine a ver)- high safety level for naclear plants and a valve pcsitiens, diverse containment isolation, and a nu:'ero of other stems.

correspendingly low risk to the pub 11:

That certainly was the underlying thou;ht as each regulation was adopted. But The next key lesson is that we must understand and use for any given regulation er staff position, it r:av be hard the operating experience of these plants ru:h tore effe:tively, to assess with any grea t precis ton the overall increase in There were several precurser events ta the Three Mile Island safety margins a:nieved thereby. The result is that me accident that should have alerted all of us to the sensitivity proba51y hava a less than optimum cost stru:ture associated cf that design to feedwater transien*<

Cne of *hese events with the re: aired safety level. That is, we get the required was al :st a trial run fer the Three '.le Island ac:ident safety, er try to, bat we nay c:casionally overshcot and cause larger :csts than are really necessary.

This is an espe:lally frustrating aspe:- cf tre ratter te:ause

.t involved an activity whl:t

  • n.;t. : RC has dcing well.

As y0u knch, we have icng ecu2 red *he extensive Optirl:2tten c f the process, to ottain the recuired repar ing cf every sert cf c:curren:e frer..:ensed far...tles.

very low rist at the least cost, requires that we have a methcd of gaantitatively determining risk levels, both Our staf' makes a selecticn of the cere signifi: ant iters Incrementally for a proposed modification and overall for a and re;cris them i*. a publicatien that goes tc *he 11:ensees.

It happens tnat a ccuple of the precursor events I speak cf complete plant.

hat' such a method in hand, one :culd rade

  • heir way inte this put11ca:1cn, but we did c' enderstand expre ss tne aim of very Iom risk to the public in nurerical
  • ner wel. eneu;h and we did net sit d:wn with the operaters terr's and evaluate pr:pesed changes against that rodel. It c' these plants ta rake sure they understood ther as well, would alse help us t: identify and reredy any seax points in Le are estat11 shin; a grou; cf exper:en:ed staf; rerbers plant designs and cperation. Overall, it would be a more khese rule jca will ce to evaluate tne cperating experiences, efficient easis for regulatien, and probably a :*are clearly
  • understand the lessons in these expe:1ences. :nd *: naie t.nderstcod ene.

Befere we can Pove in that direction, however, sare *nat the pian

  • c;eratcrs under tani then an. take all

.e need a risk assessrent rethodalegy that is.e1. ut.ierstood

    • .essarv ste;s.

and genera; y a::epted, and a set of data bases that are ade quate f o r "e pt.r;:se.

It sill be a sh11e before that is

"+ final less:n I will note here u

- nee. for tne case, tut.* 1a an objective merth horking toward.

su:stant:a' w.ri te te d:ne in the area cf energe :: planning, rarti:ulfily with respe.t te eff-site preparations for the Let re turn briefly at this point to the sub.iect of the a' f te rnat - ci an a:.. dent.

Federal, state, and local government irree n'tle Is land a:. dent, a matter cf rest serious interest age u les are inve.ved in this effort. Sc t after the a::ident to us all A nurter f Investigations are still uader say,

- rote te the governers cf states havin; nuclear plant as you know ne Pre sidential Conmission is scheduled to s ites and urged speedy and determined a:ti0n to t r:ng their 3

issue its ind;n;s late next centh, several Ccngressional plannin; up to date.

There is new a c nsiderab1v ennan:ed r

inwiries are in prt;ress, vour industry is examining majcr spirl:.d urgen:y and cocperation an th.s area.

a s pe: s c f t r e a:: n.e-and the NRC has instituted a special inquiry, under inder(ndent leadersnip, to explore the catter.

Thera are a nunner of other actatnf

  • hat are being Tne f1tdin, and recc icnaat1cns of that greap are due for taken as a resul? ef the Three Mlle sland a::iden

.nd 1 1ssuance a c.: tne en. ci this year, sculd r.

wan* yaa to regard nv ;ist here as exnaastive.

e ei *'ese a:ti:ns relat- *: plant /T6-fe a tures and c

!! > r: rv in t e t ier. t o p r di The results cf any cf

- hers the extent and c 7,1 15 of e safet insivses and

se eff r*+

40 ' ?nini se n(el to sait f:t the w - c,, w revicw ap

a t ir anj 4

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it.

2.

,t' inscs Isa 1cn> *: be a t, l e tc ide-tify 7 ;g.,

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n;epen;ent 10

, I 'l e -

.(5

  • ' and lesscns Cf Inree & le [$1anj.

m

nvestiga*lona httn their re
cNOendat 25, are still to srJe*,

.ii has a sral.-hTeaa loss *of ccClar.t g me 2

- Jen

-- ry t.e failure ci a relief valve to ya an fa. ar.

the cperaters cn J.c s:cne to T:

-., me ren r le! cc 2it c.

Tne

[.

1:e

.2t cr Fcang una.s ra cf the true nature

,r3! h: c s-mit' ny nc nal sme:

-ces au regula 1cn.

' pre c a l i... mith-that it wu a small

  • is

.s

+ :a t tuse plat nut : e ate s.fe!"

and that

+

**6J!e.

J1..nt-t eporatcra turned aff he high.

j,g 33, reg;, ie : Cra*1cn

.5

.ia M

a ft IVe j

nas subseqatn*1y led to over*'ea!1ng,

,best tus fren 21. stan pcInts

-;g;,,-

,3-a hleVe fer them.

c i. cperation is a j

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_ _. -. -, - '.h e;

.--.m-m m.;. g p, s J m.. e 'W ' A m& W ' '

M * '

7 m--

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..,,econd point is tant safe and re 10t;e e:eratac-

~~,,, r;:r. nere f rg; all elenents cf the nu: lear tr.:sst rs

,st passt".e sa e; tar.ce of snatever we regaisters

. That y a 40.

It requires an alert, a.;f:fras, and.

..ing effort by the r.w: lear industry te trpreve safety l

's;*ng the line, f rom design to cperatier.

a. verv c.::. raged in this regard by the re:en* 23 row-e en? et efterts ts f:rm the Institute of h-:; ear Ica.? 'perat.:

a tne forr.aticn and wors to date of *ne..:; ear 5sfety

,. ~

,, es:s center of the Electric Power Research ;r. stat.te.

ary

,3e efferts also are gofr.; to be ":est tays" for tne a..;etr indastry.

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