ML19340A038

M191204: Transcript - Strategic Programmatic Overview of the Fuel Facilities and the Spent Fuel Storage and Transportation Business Lines

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Issue date:	12/04/2019
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UNITED STATES NUCLEAR REGULATORY COMMISSION MEETING ON STRATEGIC PROGRAMMATIC OVERVIEW OF THE FUEL FACILITIES AND THE SPENT FUEL STORAGE AND TRANSPORTATION BUSINESS LINES WEDNESDAY, DECEMBER 4, 2019 ROCKVILLE, MARYLAND The Commission met in the Commissioners' Hearing Room at the Nuclear Regulatory Commission, One White Flint North, 11555 Rockville Pike, at 9:00 a.m., Kristine L. Svinicki, Chairman, presiding.

COMMISSION MEMBERS:

KRISTINE L. SVINICKI, Chairman JEFF BARAN, Commissioner DAVID A. WRIGHT, Commissioner

2 ALSO PRESENT:

ANNETTE VIETTI-COOK, Secretary of the Commission MARIAN ZOBLER, General Counsel NRC STAFF:

JOHN W. LUBINSKI, Director, Office of Nuclear Material Safety and Safeguards (NMSS)

ANDREA KOCK, Director, Division of Fuel Management, NMSS JACOB ZIMMERMAN, Chief, Fuel Facility Licensing Branch, Division of Fuel Management, NMSS ROBERT WILLIAMS, Chief, Projects Branch 1, Region II CHRISTOPHER REGAN, Deputy Director, Division of Fuel Management, NMSS JOHN MCKIRGAN, Chief, Spent Fuel and Transportation Licensing Branch, Division of Fuel Management, NMSS LINDA HOWELL, Acting Director, Division of Nuclear Materials Safety, Region IV

3 1 P-R-O-C-E-E-D-I-N-G-S 2 9:03 a.m.

3 CHAIRMAN SVINICKI: Well, good morning everyone. I 4 call the Commissions meeting today to order.

5 And we are convening in a public session this morning for 6 the purpose of hearing about two of our business lines. This is our, all of our 7 important activities are organized in a business line.

8 So the two that we're going to hear about today we tend to 9 meet on the two topics at the same time because there are a number of 10 interrelated topics that are being carried out, but the two that we'll be 11 discussing today are the fuel facilities and the spent fuel storage and 12 transportation business lines.

13 And for the Staff it's convenient because it tends to be some 14 of the same individuals and supporting organizations. And then I know it's 15 always noteworthy when people tune in or come in and they see, wait a 16 second, it looks different on their side of the table.

17 Commissioner Caputo had an unexpected need to be 18 absent this morning, and of course, takes a great interest in these topics. It's 19 in no way a reflection of that, as we all do. And I'm sure that she'll review 20 these materials subsequently, but she expresses her regret in not being here 21 this morning.

22 And so, we will have a little bit more abbreviated questioning 23 time. That works out well for the presenters, I think.

4 1 And again, I think these topics, I always look forward to 2 hearing presentations from these business lines because this is a lot of, kind 3 of important backbone to other programs we do that might get a little bit higher 4 attention and visibility.

5 But I think that a lot of the work that we're going to discuss 6 today are the activities that enable a lot of other things that we regulate to 7 occur. So, I know that I always take a very strong interest.

8 We will hear from the Staff in a serious of two panels. And 9 I believe we're taking a very short break in-between. Yes, we are.

10 So, the first panel will be the fuel facilities business line.

11 But before we begin, do the two colleagues present have any opening 12 comments? Okay, hearing none, then I will begin by turning it over to Mr.

13 Lubinski. Please proceed.

14 MR. LUBINSKI: Good morning, Chairman and 15 Commissioners. Im John Lubinski, I'm the director of the Office of Nuclear 16 Material Safety and Safeguards, or NMSS.

17 Today's briefing will be provided in two panels, as the 18 Chairman stated. And we will begin with the fuel facilities business line.

19 For that panel I have at the table with me today, to my right, 20 Andrea Kock, who is the Director of the Division of Fuel Management.

21 To her right is Jake Zimmerman, who is the Chief of the Fuel 22 Facilities Licensing Branch in NMSS.

23 And to my left, I have Robert Williams, Chief of the Projects

5 1 Branch 1, Division of Fuel Facility Inspection in our Region II office.

2 We appreciate the opportunity to provide the Commission 3 with an overview of both the fuel facilities and the spent fuel storage and 4 transportation business lines. We will discuss workload drivers, building a 5 21st century workforce and how processes are improved through innovation 6 and transformation.

7 Both business lines are led by NMSS. Both business lines 8 are proactively preparing for changes in the industry.

9 These preparations include ensuring that we are prepared 10 to effectively evaluate applications for new technologies. Which include high 11 assay low enriched uranium, or HALEU, and accident tolerate fuel, or ATF.

12 As the Chairman stated, some of these issues are 13 backbones of other parts of our organization. ATF is definitely one of those 14 when you consider the, before the fuel makes it to a reactor, it has to be 15 enriched, fabricated and transported. And that all falls within these two 16 business lines.

17 We're also evaluating applications for new facilities, such as 18 consolidated interim storage facilities. We merged the two business lines 19 recently into one division, the Division of Fuel Management. And that 20 occurred on October 13th.

21 This is expected to result in efficiencies, which will support 22 strategic workforce development by combining functions and cross training of 23 Staff. The reorganization maintains the same number of direct technical staff

6 1 and did result in a reduction in supervisors as well as management support 2 positions.

3 Next slide, please. I will now provide an overview of the 4 fuel facilities business line. The business line continues to be successful in 5 regulating the countries fuel cycle facilities.

6 The scope of the activities in the business line includes the 7 licensing and oversight of ten fuel cycle facilities in the United States. Six of 8 these are currently operating, three are licensed with construction pending 9 and one facility is idle production. The location of the facilities are shown on 10 this slide.

11 The business line supports additional broad areas, including 12 material control and accounting, export licensing, special nuclear material 13 security and the implementation of international safeguards that comes from 14 US-IEA agreements and bilateral agreements with nuclear trading partners.

15 These activities are accomplished in close coordination with 16 our partner offices. These include Region II and the Office of Nuclear and 17 Incident Response, the Office of the General Counsel, Office of International 18 Programs and the Office of Research.

19 Next slide please. We are effectively implementing 20 strategies to prepare for emerging technologies, including receipt of license 21 amendments and new applications for HALEU and ATF.

22 We have been conducting assessments of the current 23 regulatory framework to identify and resolve any licensing challenges. We

7 1 are ensuring that our workforce is equipped to review the new applications for 2 both HALEU and ATF.

3 We are engaging early with our stakeholders to prepare for 4 anticipated applications to support these new technologies. In the spring, we 5 anticipate Centrus submitting a license application to amend its American 6 Centrifuge plant license for a HALEU demonstration cascade.

7 In anticipation of receiving that request, the Staff is holding 8 pre-application meetings with Centrus and the Department of Energy. We 9 are also meeting with X-energy to prepare for a potential application to 10 fabricate pebble bed reactor fuel.

11 Next slide please. We are also making progress and 12 becoming a modern risk-informed regulator. We have engaged our 13 stakeholders to make our programs smarter and more efficient without 14 compromising our goal of safety.

15 For example, we are building smarter licensing and 16 inspection programs through extensive engagement with stakeholders and 17 evaluation of where we can utilize risk insights, operational experience and 18 agency best practices to improve our programs.

19 We continue to provide additional information to support a 20 shared understanding of expectations on what constitutes reasonable 21 assurance of adequate protection. We are determining the scope and focus 22 of reviews based on safety significance of the activities.

23 Also, we are reaching conclusions by understand

8 1 performance at a system level, instead of an individual component level. And 2 understanding that new technologies may be safer although they lack the 3 operating experience.

4 We are communicating the importance of becoming a 5 modern risk-informed regulator with all the Staff in NMSS and our partner 6 offices through direct conversations with our executive team and through 7 Skype side chats.

8 The graphic on this slide is one that we developed for a 9 recent Skype side chat. I would like to turn to Andrea for her part of the 10 presentation.

11 MS. KOCK: Thank you, John. Good morning, Chairman 12 and Commissioners. I'll be providing you with an overview of the fuel cycle 13 current environment, including an update from our last Commission briefing 14 last spring.

15 During the presentation I'm going to highlight a few of our 16 significant programmatic activities that demonstrate our focus on preparing for 17 new technologies, making progress and becoming a modern risk informed 18 regulator and optimizing our program so that we can find a smarter way to 19 safety together.

20 Next slide please. We are effectively implementing 21 strategies to prepare for new technologies by amplifying our engagement with 22 both internal and external stakeholders. This will facilitate a common 23 understanding of these new technologies, as well as the timelines that are

9 1 needed to support the proposed deployment of these new technologies.

2 For example, in late August we issued a letter to the Nuclear 3 Energy Institute notifying them of when we need to receive applications for the 4 use of ATF and HALEU fuels. This letter defines the schedules and the time 5 frame of fuel enrichment, fabrication and transportation licensing actions that 6 will be needed to support the industries plan for batch loads of ATF by 2023.

7 To support the 2023 deployment of ATF, for example, for 8 higher enrichments, NMSS must receive an application to increase fuel 9 enrichment by June of 2020. And in fact, we have received our first license 10 amendment requests related to higher enrichment applications from Global 11 Nuclear Fuel Americas and Louisiana Energy Services.

12 We received an amendment Global Nuclear Fuel Americas 13 to increase their enrichment limit to eight percent in October. And just in 14 November we received an amendment from the Louisiana Energy Services to 15 increase their enrichment limit from five to five and a half percent.

16 Since the last Commission meeting, our Staff worked with 17 NRR to issue a burn up enrichment extension to the ATF project plan that 18 identifies our strategy to prepare the agency to review future licensing actions.

19 The draft extension to the project plan went out for public 20 comment in August and September. We held a public meeting in early 21 September, and then we finalized and issued the project plan in October.

22 To date, we have not identified any significant regulatory or 23 technical challenges with regard to HALEU or ATF for fuel cycle facilities. We

10 1 are engaging in early training, research requests and continued dialogue with 2 internal and external stakeholders as new information becomes available, with 3 the goal of ensuring that our Staff are equipped with the knowledge and skills 4 that are needed to support this workload.

5 We have evaluated our regulations to determine if review of 6 these new technologies will require rulemaking.

7 For fuel facilities, no changes to our regulations are needed 8 to accommodate these new technologies. We will, of course, engage the 9 Commission if we determine that rulemaking is necessary.

10 We've also not identified any new technical issues that are 11 vastly different from the technical issues that are associated with existing fuel 12 facilities.

13 Externally, we're utilizing our various forms for engaging our 14 internal and external, stakeholders.

15 Most notable we are going to have a fuel management track 16 at the 2020 Regulatory Information Conference. Where we will have a 17 session on licensing, storage and transportation for fuels for advanced and 18 non-light water reactors.

19 Through these different forms and communication with 20 industry, we're working to identify and address any challenges early. We're 21 also actively participating in the industries ATF working group that was formed 22 to discuss regulatory and technical initiatives that are needed to support ATF 23 and HALEU.

11 1 Next slide please. As John mentioned, we are making 2 progress in becoming a modern risk-informed regulator. We continue to 3 enhance and revise our licensing practices.

4 For example, last November we issued a comprehensive 5 update to the licensing handbook for fuel facilities that enhanced our licensing 6 practices by providing clearer roles and responsibilities and expectations for 7 conducting licensing reviews.

8 We're also integrating licensing procedures for the two 9 business lines, with the goal of adopting best practices from across the 10 business lines and further risk informing our approaches.

11 In April we proactively initiated efforts to further enhance 12 licensing and inspection programs for fuel facilities. Two working groups 13 were formed to holistically assess the programs and to make 14 recommendations on where we can further integrate best practices and risk-15 informed insights.

16 As we make progress in these areas, we've been 17 coordinating across business lines to share any insights.

18 Since the briefing in April, the business line has held several 19 public meetings, which involve the wide-range of stakeholders, to discuss 20 improvements to the licensing and oversight programs.

21 The working group on inspection oversight is developing its 22 final recommendations. Based on the numerous public interactions we've 23 had, we are confident that changes can be made to risk-inform our oversight

12 1 process while maintaining safety.

2 During our most recent meetings, our stakeholders 3 expressed optimizing in the progress we've made, and that we have alignment 4 in several areas. Including identification of the areas where inspection 5 procedures may have overlaps, the overall risk ranking of the areas that we 6 inspect, and the level of effort required for these areas and accounting for the 7 effectiveness of approved corrective action programs in the inspection 8 program.

9 There are other areas where we do not have alignment, and 10 we're still considering these. Such as, whether and how we should 11 incorporate flexibility into the level of inspection effort, the degree to which we 12 should utilize evolving information on safety margins to guide our inspection 13 program and the areas that should be inspected by regional and resident 14 inspectors.

15 The working group on licensing is expected to provide its 16 report this month. The working group is evaluating the recommendations 17 received, which include enhancements in the areas of communication, 18 issuance of requests for additional information and early alignment on the 19 focus areas for our licensing efforts.

20 We're evaluating these recommendations. We plan to 21 finalize them in the near future. And we plan to implement these 22 recommendations by Fiscal Year 2021.

23 Next slide please. To promote transparency and clear

13 1 communication, the business line has taken significant steps to move forward 2 with implementing recommendations from the self-assessment report on non-3 fee billable work that was mentioned during the last Commission briefing.

4 In July we met with management from across the major 5 offices, our partner offices, to present the results of the self-assessment and 6 our plan for corrective actions.

7 Key recommendations from the assessment include 8 creating and reviewing easily accessible reports on non-fee billable charges 9 to the business line, maintaining closer oversight about resource management 10 on non-billable projects and conducting an annual review of the mapping of 11 cost activity codes to business line products.

12 Since the last Commission briefing, we've taken actions to 13 improve our ability to track projects associated with non-billable hours. We 14 will be using this information in the future to ensure that we're spending efforts 15 on the most important areas.

16 For example, we had a meeting with our partner offices and 17 then we issued a memo which provides guidance on tracking non-billable 18 work. We're also developing tools and practices to better track and monitor 19 non-billable hours for better accountability and transparency.

20 We will be completing an annual review of the charges 21 toward non-fee billable work, and then we will identify any additional actions 22 that are needed based on this assessment.

23 Although we're still in the early phases of implementing

14 1 these actions, we're optimistic that they will help to provide better planning, 2 prioritization and management of future initiatives within our business line and 3 increase in the transparency of our annual fees, potential opportunities for our 4 stakeholders to weigh in on the priority of initiatives and tools that demonstrate 5 consistency with the NMSS, adequate protection memo and NRC's principles 6 of good regulation.

7 This concludes my presentation. I will now turn it over to 8 Jake. Next slide please.

9 MR. ZIMMERMAN: Thank you, Andrea. Good morning, 10 Chairman, Commissioners.

11 I'll be providing you an overview of the fuel facilities licensing 12 and activities with emphasis on our continued worked to safely license fuel 13 facilities, actions to prepare for new applications and workforce readiness.

14 Next slide, please. We continue to effectively and 15 efficiently conduct our fuel facility licensing reviews. While there has been an 16 overall decline in the number of licensing actions over the last several years, 17 as shown by the chart above, we continue to effectively implement our 18 licensing program by performing timely reviews and successfully achieving 19 our performance metrics. While also implementing program improvements.

20 We continue to successfully navigate the unique aspects of 21 fuel cycle licensing through applying technical expertise in the areas of 22 complexity, openly considering alterative views in our decisions and focusing 23 on effective and risk-informed licensing processes.

15 1 In Fiscal Year 2019 we completed a total of 46 licensing 2 actions, an increase of 18 percent over Fiscal Year 2018. While completing 3 these reviews with approximately 19 percent less resources.

4 A significant accomplishment that I attribute to, one, and 5 most importantly, our knowledgeable and dedicated Staff. And many of them 6 are here in the audience. And I thank them for their efforts.

7 An implementation of enhancements that we've made to the 8 program. Most notably our licensing review handbook that include increased 9 focus on the use of document templates, detailed schedule and resource 10 estimates for our reviews and tracking of milestones throughout our review.

11 Notable examples of our accomplishments include 12 expedited reviews associated with security requests. And several first of the 13 kind requests for medical devices that would be used in classified areas.

14 We also made significant progress on the review of two 15 license renewals. Specifically the Westinghouse, Columbia Fuel Fabrication 16 Facility and the Honeywell Metropolis Facility.

17 As reported to you in April, the environmental assessment 18 for the Westinghouse license renewal was reopened in June of 2018 because 19 of new information on a number of leaks at the facility and public concerns 20 about contaminated groundwater.

21 We recently completed the draft Environment Assessment 22 and made it publicly available in October for a 30 day comment period. The 23 Staff is currently evaluating the public comments.

16 1 For Honeywell, the Staff has completed its safety and 2 environmental review and anticipated issuing a final decision by the end of the 3 month.

4 Currently, we continue to manage our licensing program, 5 meet the needs of our licensees and deliver licensing actions in a timely 6 manner. Moving forward, based on the known and anticipated workload, we 7 expect that the volume of licensing actions will remain near today's levels.

8 Next slide please. We are ensuring that we are prepared 9 for new applications expected through proactive communication. Given the 10 evolving environment, we are emphasizing the importance of communications 11 with our licensees and applicants.

12 Frequent and early communications on future plans allow 13 us to create a more accurate budget, ensure we have the required technical 14 skills and allocate sufficient resources.

15 For example, we gather information on potential licensing 16 actions during site visits, routine management calls, and in our discussions as 17 part of the biannual cumulative effects of regulations meetings that we hold.

18 We reach out to anticipated applicants for upcoming 19 projects and are coordinating internally on several applications. For 20 example, we are providing substantial support to the Office of Nuclear Reactor 21 Regulation for the review of the Part 50 operating license for SHINE, a medical 22 isotope product facility.

23 We are also preparing to license and inspect fuel, facilities

17 1 with new fuel types and higher enrichments. We are conducting pre-2 application meetings with X-energy for their expected application in Fiscal 3 Year 2021 for a new facility for pebble bed reactor fuel.

4 And similarly, we are preparing for the application from 5 Centrus for construction and operation of the American Centrifuge Plant at 6 higher enrichments. We are enhancing our communications to reach a great 7 external audience.

8 In October of 2019 we issued a Federal Register notice 9 announcing the creation of the fuel facilities correspondence Listserv. The 10 new Listserv will allow stakeholders, including members of the public, to 11 register their email, which will then allow them to receive notification of NRC 12 public documents.

13 You may be familiar that this is something that the power 14 reactors have also used over the years. This will be used by both 15 Headquarters and our Region II counterparts for the fuel facilities.

16 We are also coordinating with the federal government to 17 share information. Most notably, we continue to engage the Department of 18 Energy to ensure we'll be ready for future reviews of new fuel types for existing 19 and advance reactors.

20 We are working with the Office of Nuclear Regulatory 21 Research and National Laboratories to conduct research on different fuel 22 types, such as metal fuel or molten salt, so that we are prepared for the future 23 and applications for operations with different fuel types.

18 1 We contracted with Pacific Northwest National Laboratory 2 to identify hazards associated with metal fuel fabrication and methods for 3 controlling those hazards.

4 Similarly, we contracted with Oak Ridge National Laboratory 5 to identify hazards typically associated with fuel salt processing. As well as 6 methods for controlling these hazards.

7 The reports from these efforts are available to help 8 reviewers assess future applicant's identification and management of fuel 9 fabrication hazards for their specific operation.

10 We also contracted with Oak Ridge National Laboratory to 11 consider how metal, material, control and accounting of special nuclear 12 material would be applied at a pebble bed reactor. As the fuel type and fuel 13 reloading cycle are quite different than at current light water reactors.

14 The Oak Ridge National Laboratory report provides a 15 model, material, control and accounting plan for a pebble bed reactor.

16 Including areas such as management structure, measurement control system, 17 material balance areas and item control areas.

18 The draft report is currently being reviewed by the Staff.

19 When finalized, the report will help inform future guidance on material, control 20 and accounting for review of advance reactor applications.

21 Finally, we are also working with Research to assess 22 availability of criticality code benchmarking data for higher enrichments. This 23 assessment will determine if new criticality experiments are necessary or if

19 1 existing experiments can be extrapolated to higher enrichments or otherwise 2 be demonstrated to be applicable for benchmarking higher enrichment 3 criticality code calculations.

4 And this is for the, in the area of storage and transportation.

5 Next slide please. To ensure our workforce is prepared to 6 license the technologies of the future and to enhance knowledge and 7 management, in Fiscal Year 2019 we had a series of licensing seminars to 8 enhance and promote knowledge management across the business line.

9 Topics included draft requests for additional information, 10 writing safety evaluation reports, understanding the licensing metrics and 11 Staff's roles, counterintelligence, and the use of web-based licensing to 12 manage and monitor our licensing workload.

13 Recently we expanded our licensing seminars to talk about 14 individual fuel facilities to deepen our Staff's knowledge and understanding of 15 those fuel facilities. And that's been a really great initiative as we've merged 16 into the division of fuel management, where we'll be cross training individuals 17 so those people that hadn't worked on fuel facilities in the past, this is a good 18 overview to start them with.

19 We also anticipate providing licensing seminars on process 20 improvements identified during our smarter licensing effort in new technology 21 and working groups.

22 The newly merged division allows for sharing technical 23 experts between the spent fuel and fuel facilities business line. We are

20 1 encouraging Staff in key technical areas to complete cross qualifications to 2 enhance their agility and enable their review of future license applications.

3 To ensure we can support the expected new applications for 4 medical isotopes in the X-energy application for fuel facility, we factored the 5 skills necessary to support these reviews into the strategic workforce planning 6 process so we have the correct Staff to meet the workforce demand.

7 We will rely on mentorship from senior staff, qualification 8 programs and other in-house training opportunities to train new hires. This 9 concludes my part of the presentation, I'll now turn it over to Robert Williams.

10 MR. WILLIAMS: Thank you, Jake. Good morning, 11 Chairman, Commissioners. My presentation will focus on the fuel cycle 12 inspection program. I will highlight several accomplishments, enhancements 13 and ongoing activities.

14 Region II has oversight of the nation's fuel cycle facilities 15 and plays a crucial role in ensuring safe and secure operations at the sites.

16 The safe oversight of fuel cycle facilities continues to be our primary focus.

17 Next slide please.

18 We are focused on effective implementation of an inspection 19 program that concentrates on those areas that are most important to safety 20 and safeguards.

21 We completed the fuel cycle facilities core inspection 22 program for Fiscal Year 2019, which included conducting approximately 65 23 core inspections, a program adjustment review and two supplemental

21 1 inspections, which ranged in scope from follow-up activities at the BWXT 2 facility due to previous escalating enforcement actions involving a desiccant 3 vessel, to inspections centering around safety culture issues at the 4 Westinghouse facility.

5 These activities were comprised of multiple inspection 6 procedures at each of the operating facilities, including information and 7 physical security.

8 With an eye toward the future, we are actively engaged in 9 efforts to ensure we are ready to support inspection activities at new facilities.

10 As Centrus transitions the American Centrifuge Plant from the 11 decommissioning phase to the operating phase, Region II plants work closely 12 with our partners in NMSS to develop a master inspection schedule.

13 This will account for the licensee's current plan to 14 commence limited operations with only one cascade and adding addition 15 cascaded as budgeted by the Department of Energy.

16 In support of the licensee's current plan to submit an 17 amendment request to increase enrichment to 19.75 percent, we will again 18 work NMSS to develop an inspection program commensurate with any 19 additional risk.

20 The Region has been actively engaged in efforts to 21 modernize our decision-making while implementing the inspection program.

22 In September, the Westinghouse Columbia facility notified us of an issue 23 involving moisture intrusion in their instrument air system, which could have

22 1 allowed water into a uranium oxide powder system.

2 Initial screening of this issue would have driven us to 3 consider immediately launching a reactor inspection team to the site without 4 the benefit of understanding the safety significance of the event. Instead, the 5 Region employed several tenants of integrated decision-making by allowing 6 the inspectors time to engage licensees from the Regional Office and quickly 7 collaborate with subject matter experts.

8 When eyes-on observations were required, a short two-day 9 site visit by Regional inspectors afforded additional overall understanding of 10 the event. The information gained provided valuable insights that informed 11 recommendations to senior management resulting in a more effective use of 12 resources.

13 Ultimately it was decided that inspection follow-up on the 14 event during the next scheduled onsite visit would be the most appropriate 15 regulatory response.

16 As a continuous learning organization, we are proactively 17 making changes to enhance our effectiveness within the inspection program.

18 We are partnering with NMSS in support of this modern fuel cycle inspection 19 program efforts.

20 As part of the working group evaluation of the program, we 21 are proposing adjustments to ensure we are focusing our resources on the 22 most important issues. For example, we assessed how to best employ the 23 Category 1 facility resident inspectors limited resources by reevaluating how

23 1 much time they were spending in areas where specific expertise is required.

2 We performed an in-depth, holistic review of each inspection 3 procedure currently in use, focusing on right sizing and eliminating overlap of 4 activities and duplicative efforts. We look for ways to better incorporated 5 operating experience at the inspections, both during the planning stages and 6 during their implementation.

7 These efforts were to ensure that we maintained our focus 8 on areas of risk significance and continued to apply resources commensurate 9 with that risk.

10 We ensured that our efforts were informed through actively 11 soliciting feedback from both internal and external stakeholders. This 12 included holding nine public meetings at various locations in an attempt to 13 maximize public engagement.

14 Next slide please. All of these program enhancement 15 efforts will amount to little without continued investment in our people.

16 We are actively maintaining a focus on knowledge 17 management, Staff agility and emphasizing greater collaboration with other 18 Regional divisions, our partner office and stakeholders.

19 Presently, 55 percent of our inspectors have pursued cross 20 qualifications in the reactor oversight program, the construction inspection 21 program, the materials business line or as a safety culture assessor.

22 Our inspectors have provided resident support and initial 23 startup testing report for the Vogtle 3, 4 units currently under construction.

24 1 Support of the review of licensee submittals in the area of nuclear criticality 2 safety and participated in resident baseline and problem identification and 3 resolution inspections at operating reactor facilities.

4 The specific knowledge gained and benchmarking of those 5 programs helps bolster our technical credibility and gives valuable insights to 6 identify trends and best practices that can inform our inspection planning and 7 implementation efforts.

8 This focus also greatly aligns with Region II's ongoing efforts 9 to both holistically management our future workload shifts and to provide our 10 Staff with more opportunities to develop their skill sets.

11 We're employing individual and intentional talent 12 development, aligning the specific needs of the inspectors with the 13 opportunities that become available. This win-win environment increased the 14 depth of resources available to the Region and Headquarters, while also 15 giving the Staff greater opportunities in their careers.

16 Pictures in the top right corner of this slide is our senior 17 resident inspector with BWXT conducing an inspection of licensee activities at 18 that Category 1 facility. The bottom right corner shows one of our regional 19 inspectors performing walk downs at the URENCO facility.

20 Following NMSS's Division of Fuel Management 21 reorganization, we have a continued focus on collaboration with the program 22 office. As new project managers were assigned to each facility, we 23 developed new working relationships and established routine communications

25 1 to reinforce our collaborative work environment.

2 Our community of practice leads are identifying relevant 3 training and actively conducting knowledge management sessions with Staff 4 and new project managers to ensure and strengthen technical competencies.

5 The Division of Fuel Facility Inspection recently held a 6 management retreat and integrated key principles of the leadership model.

7 This was the first time we included the senior inspection staff in such an effort.

8 The focus was to advance the idea of leadership at all levels 9 and empower the Staff the take ownership of their roles as leaders within the 10 agency. Specifically, the management staff actively participated in 11 discussions around innovation, diversity of thought, collaboration and 12 teamwork.

13 We developed more meaningful communication methods, 14 developed strategies for overcoming barriers to engagement and table topped 15 ways to incentivize Staff to embrace leadership opportunities. Since the best 16 instructors tend to be our peers, the senior Staff then took it upon themselves 17 to inform and communicate these behaviors to the remaining division 18 inspectors by planning their own retreat and incorporating engaging innovative 19 activities.

20 Next slide please. Enhancing our openness with the public 21 remains a focus for us to ensure we consider diverse viewpoints. We strongly 22 believe that open dialogue leads to broader views being expressed. And this 23 in turn enhances our decision-making process.

26 1 We continue to perform outreach and actively engaged with 2 local stakeholders, closely partnering with our government liaison and public 3 affairs officers, we supported joint meetings with the South Carolina 4 Department of Health and Environmental Control and met with newly elected 5 council members to proactively communicate regarding the events at the 6 Westinghouse Facility.

7 Our inspectors also participated in public meetings for the 8 environment assessment review associated with the Westinghouse license 9 renewal. We held teleconferences with Congressional staff and supported 10 discussions surrounding the URENCO Facility.

11 To provide more options for in-person participation in NRC 12 public meetings, we also hosted several of the smarter fuel cycle inspection 13 program meetings in Region II. Our residents have conducted extensive 14 outreach to local communities and local officials.

15 For example, our senior resident inspector at BWXT 16 proactively engaged with Campbell County Sheriff and members of the 17 Campbell County Public Safety Office to identify areas of local concern and 18 cooperatively develop public outreach activities.

19 We also piloted a poster session at nuclear fuel services this 20 year to encourage more one-on-one participation with the public during 21 licensee performance review meetings.

22 As seen in the top right picture of this slide, our senior 23 resident inspector at the nuclear fuel facility services is directly engaging with

27 1 members of the public in a more relaxed environment.

2 At this same meeting we also accommodated a public 3 poster session presented by local advocacy groups. These interactions 4 fostered a healthy dialogue of differing viewpoints. And out of this, our Staff 5 was able to directly address more than 20 specific questions related to the 6 NFS facility.

7 The pictures shown in the bottom right of this slide shows 8 our public affairs officer collaborating with inspectors as they talk with 9 members of the public at a local fair event about the NRC and what we do.

10 It's these levels of engagement that promotes transparency and builds public 11 trust and confidence in our mission of safety, security and environmental 12 protection.

13 All in all, we will continue to focus on our mission, implement 14 strategies to address current and future challenges, identify innovative ways 15 to continue preparing our Staff for the future and maintain and nurture our 16 relationships with all of our stakeholders.

17 This concludes my part of the presentation, I'll now turn it 18 back to John.

19 MR. LUBINSKI: Thank you, Robert. Also, thank you, 20 Andrea, Jake. With that, Chairman, that concludes our prepared remarks this 21 morning and we now entertain any questions.

22 CHAIRMAN SVINICKI: All right, thank you. Thank you 23 very much for your presentations. We'll begin the questions today with

28 1 Commissioner Baran.

2 COMMISSIONER BARAN: Good morning, thanks for your 3 presentations. Andrea, I'd like to delve into the potential changes to fuel 4 facility inspections in greater detail.

5 I know that an NRC Staff working group has been 6 developing recommendations in this area. Are those recommendations final 7 or are they still a work in progress?

8 MS. KOCK: So, right now the recommendations are a work 9 in progress. The working group has some proposed recommendations that 10 were discussed at a public meeting a few weeks ago. And they'll be 11 considering the feedback that we receive before we make any final decisions.

12 COMMISSIONER BARAN: Okay. I reviewed the working 13 groups presentation for that November 15th public meeting and I think we 14 need some truth in advertising.

15 The Staff refers to smarter or more risk informed 16 inspections, but to be clear, the Staff is talking about an overall reduction in 17 NRC inspections for fuel facilities, is that right?

18 MS. KOCK: I wouldn't necessarily characterize it that way.

19 When we started on, down the path of looking at the inspection program, the 20 thought was to do a holistic review of the program. That means risk informing 21 it. Our goal was not necessarily to reduce inspection hours.

22 I think what you're pointing to is that the proposal that was 23 discussed at the meeting did include a reduction of hours. The important

29 1 thing, I some areas. And it also included an increase in other areas.

2 COMMISSIONER BARAN: Yes, so my question really 3 goes to the effect, not the goal or the intent, but the effect of the changes being 4 discussed as an overall reduction of NRC inspections. Is that right?

5 MS. KOCK: So, we haven't made any final decisions so I 6 wouldn't say that our, the effect of the changes being discussed is a reduction.

7 Again, we're looking to risk inform the program.

8 The proposal that was discussed at the meeting did reflect 9 an overall reduction. And that reflected a reduction in some areas and an 10 increase in others.

11 COMMISSIONER BARAN: Let's look at that in a little more 12 detail. I have the slides here from the November 15th meeting, and as you 13 say, these are not final recommendations, let alone a final decision it's the 14 current state of the recommendations, proposed recommendations.

15 Based on the slides, the working group seems to be 16 contemplating a ten percent reduction in overall annual inspection hours for 17 the two Cat 1 facilities, a 20 percent reduction in overall annual inspection 18 hours2.083333e-4 days <br />0.005 hours <br />2.97619e-5 weeks <br />6.849e-6 months <br /> for the Cat 3 fuel fabrication facilities and a 19 percent reduction for the 19 gas centrifuge facility. Is that your understanding of what's being discussed 20 at this point?

21 MS. KOCK: That was what was discussed at the public 22 meeting. And if I could just give you a little bit of background on how the 23 working group was considering what they proposed at the public meeting.

30 1 I think it actually was a good testament to our Staff. And as 2 long as I have been with the agency it never ceases to amaze me what they 3 can come up with you set them on a task.

4 But they went through a very methodical process to come 5 up with a proposal. Again, it's not final but it was discussed at the public 6 meeting.

7 They looked at a few different factors in coming up with the 8 original proposal. They looked at the risk of the different areas that we 9 inspect, they looked at ISA insights from the facilities, they looked at 10 operational experience.

11 They even went so far as to look at, where are our 12 regulations more complex or less complex. And they had a very methodical 13 and objective way to kind of roll that up in coming up with a proposal. So I 14 just wanted to share with you that background.

15 The other thing --

16 COMMISSIONER BARAN: I appreciate that. Let me ask 17 about this. So, you mentioned kind of tiering, by risk, the safety issues. And 18 the working group views criticality as a top tier safety issue that warrants, 19 maintain a high level of inspection effort.

20 But the working group is apparently still contemplating a 37 21 percent reduction in annual inspection hours focused on criticality safety at 22 Cat 1 facilities. Is your understanding that that's the change that's being 23 actively considered?

31 1 MS. KOCK: So you're correct, criticality is one of the high 2 risk areas that we consider in the fuel cycle inspection program.

3 The reduction in hours that you see on that chart is actually 4 not a reduction, it's a shift of those hours into plant ops.

5 COMMISSIONER BARAN: Into what?

6 MS. KOCK: Into plant, I'm sorry, into plant operations.

7 COMMISSIONER BARAN: Okay.

8 MS. KOCK: The plant operation procedure. And so, in 9 some areas there is a reduction based on what we view as the risk or the 10 stability of a particular program or the maturity of that program. That is true.

11 In other areas there's a shift made, and criticality was one 12 of those.

13 COMMISSIONER BARAN: So, if I look at this chart it looks 14 like the working group is considering a 50 percent reduction in fire protection 15 inspection hours at Cat 1 facilities and a similar 40 percent reduction in fire 16 protection inspection hours for all the other classes of fuel facilities.

17 Working groups considering a 39 percent reduction in 18 material, control and accounting inspection hours for Cat 1 facilities. Working 19 group is contemplating cutting emergency preparedness inspections for all 20 fuel facilities from once a year to once every two years.

21 As we heard earlier, environmental protection and 22 groundwater contamination have been an issue at the Westinghouse 23 Columbia facility. But it looks like the working group is thinking about

32 1 recommending reducing the frequency of the effluent control and environment 2 inspection from once a year to once every three years. So that would be a 3 two-thirds cut in inspection.

4 How do you think state and local stakeholders would react 5 to that reduction and oversight if it were made?

6 MS. KOCK: So, through our efforts in looking at the 7 inspection program, I've heard a wide variety of views from stakeholders.

8 I think some stakeholders would be, for example, the 9 reduction that we're considering in the effluent area, which was driven by the 10 safety risk in that area as well as the stability of those programs. Some 11 stakeholders would not agree with the reduction that was discussed at the 12 meeting.

13 I think there are other stakeholders who would think that we 14 aren't taking enough of a reduction in that area. And so that's why we held 15 nine public meetings and really wanted to make sure that we got fulsome 16 feedback from our stakeholders.

17 And before we make any final decisions, we'll really want to 18 consider all of those views.

19 COMMISSIONER BARAN: I don't want to be one sided on 20 this. As you mentioned, there is, it's not multiple areas, it's one area, plant 21 operations, that the working group is contemplating an increase.

22 Are there, and you've kind of talked this a little bit, is it, for 23 that increase in that area of plant operations, are other existing inspections

33 1 being folded into plant operations or would this be an actual increase in 2 inspection hours?

3 MS. KOCK: So, in plant operation there is a couple of 4 different plant operations. There's a couple of different things going on.

5 One is the shift of some of the hours from criticality into plant 6 operations. There is actually an increase being proposed there in the area of 7 chemical safety.

8 So in our group, and Robert was part of the group, they did 9 a great job. When our group looked back and where we need to focus, they 10 did determine that chemical safety was an area where we probably need more 11 focus than we had in the past.

12 So there is an actual increase there as well as a shift. So, 13 in some cases it's a little bit difficult to determine, is it an actual increase or 14 decrease.

15 COMMISSIONER BARAN: Right. In our presentation 16 you mentioned that the Staff has alignment with stakeholders on accounting 17 for the effectiveness of approved corrective action programs and inspections.

18 Which stakeholders is the Staff aligned with on this point?

19 MS. KOCK: So, let me make it clear. I think you of course 20 understand this, the final decision on any changes that we make will be the 21 NRCs it won't be our stakeholders. So I think that's clear to all of us.

22 When I referred to alignment, what I meant was we had a 23 common understanding with our stakeholders as far as what the risk rankings

34 1 are in different areas. What the level of inspection should be.

2 And what was discussed at the public meeting was, there 3 was a common understanding in some of those areas among the stakeholders 4 that were present.

5 COMMISSIONER BARAN: Okay. And what would it 6 mean to account for the effectiveness of corrective action programs and 7 inspections? What's being contemplated here?

8 MS. KOCK: So, what's being contemplated, and this is a 9 complex area of our regulations I think, but what we're trying to consider is 10 how we should consider, and so for fuel cycle facilities a corrective action 11 program isn't actually required.

12 But if a licensee commits to one and we review it and we 13 have said we approve of this and it's a good corrective action program, how 14 should that be considered in our program.

15 I think there is some recognition that if a licensee has a 16 corrective action program that we've reviewed and approved, it could result in 17 some risk reduction at the facility because that licensee is actively looking for 18 problems, identifying problems and correcting problems. And so, one set of 19 views would be, that actually could reduce the risk at the facility.

20 The other thing we're trying to contemplate there is, how 21 should we consider those fuel facility licensees that do have reviewed and 22 approved corrective action program compared to other facilities in the fuel 23 cycle area that don't and kind of normalize that across the inspection program.

35 1 So how should that be considered.

2 COMMISSIONER BARAN: Is there a potential that 3 licensees would get even fewer inspections on the basis of having a functional 4 corrective action program?

5 MS. KOCK: It could result, if you were to "credit the 6 corrective action program," it could result in a reduction in other areas if you 7 try and normalize the number of inspection hours across the entire inspection 8 program.

9 COMMISSIONER BARAN: If you --

10 MR. LUBINSKI: If I could --

11 COMMISSIONER BARAN: Oh, go ahead.

12 MR. LUBINSKI: I'm sorry, if I could add to that, 13 Commissioner. As Andrea said, when we're talking about the corrective 14 action program itself and the identification.

15 What we've also heard from our external stakeholders is, 16 when they're implementing a corrective action program effectively, not only 17 are they self-identifying, they're going above and beyond what the regulatory 18 requirements are in implementing additional controls, which they're saying to 19 us is actually decreasing a risk profile, increasing their safety margins.

20 So, we believe the team is looking at that to say that if a 21 licensee has a program in place that actually is increasing safety at the plant 22 and having addition safety margin, should that then correspond to less 23 inspections in certain areas where they have put those voluntary controls in

36 1 place, whether active or passive controls that they would install.

2 COMMISSIONER BARAN: Hmm. I mean, it's interesting 3 that what we're contemplating is extra credit for corrective action program. It 4 just seems like, almost like a basic element of running up --

5 MR. LUBINSKI: I wouldn't --

6 COMMISSIONER BARAN: -- safety.

7 MR. LUBINSKI: I wouldn't call it the extra credit. I would 8 say that as the team looked at it, as Andrea said, factoring in things like the 9 risk profile of the plants, the impacts of the ISA, how do they look at risk 10 insights.

11 It's us looking at the program in accordance with the PRA 12 policy and looking at our risk assessments to say, how do you appropriate 13 consider risk in using your resources to focus on the most significant areas.

14 And if a plant, a licensee were to put measures in place that actually increases 15 safety of the plant, we have to ask ourselves, should we be spending the same 16 amount of effort inspecting that area versus focusing our efforts somewhere 17 else.

18 COMMISSIONER BARAN: I want to ask two other quick 19 topics in this area. One on the concept of flexible inspection hours that's 20 been discussed.

21 Can you give me just like a brief description of what that 22 would look like or what's being contemplated there?

23 Is it the idea that within a certain band inspection hours

37 1 could increase or decrease based on something?

2 MS. KOCK: So, flexibility is a concept that's actually 3 implemented through several of the inspection programs at the NRC and other 4 programs. And the concept is, we're trying to determine what is necessary 5 for us to provide adequate oversight at these facilities.

6 And that's like the core inspection program or a base line 7 number of hours. But there's always the possibility that we may need more 8 or less inspection based on factors at the plant, operational experience that 9 we see, events that may occur.

10 Our inspectors have great intuition in insights and 11 experience and we want to, and a lot of cases provide them the flexibility to 12 be able to make those judgements in the field if they see something that they 13 need to delve into a little bit more. So, that's the concept of flexibility that's 14 being discussed here.

15 COMMISSIONER BARAN: And then, it sounds like the 16 Staff is considering, at least at the working group level at this point, some 17 potentially major changes to the inspection program for fuel facilities. Do you 18 plan to provide a notation vote paper to the Commission so that we make the 19 final decision on this?

20 MS. KOCK: So, again, we haven't made a decision. So I 21 think the next step is for us to decide what changes that we think we need to 22 make. And based on what changes we think we need to make, then we'll 23 look at, is this a policy issue or not.

38 1 The way we have typically looked at whether there is a 2 policy issue is, is it a major programmatic change to the inspection program.

3 Basic tenants of the program that are changing. And that's the decision, I 4 think, that we'll need to look at when we consider, is this something that the 5 Commission should weigh in.

6 COMMISSIONER BARAN: Is there, as you're thinking 7 about inspection hours, the overall structure would remain the same but the 8 hours9.259259e-5 days <br />0.00222 hours <br />1.322751e-5 weeks <br />3.044e-6 months <br /> were to be dramatically reduced. Is there some threshold at which you 9 would say, well, doesn't the policy matter if we're going to reduce hours by a 10 significant margin?

11 MR. LUBINSKI: In looking at our guidance, as Andrea 12 said, that would be a judgement we would need to make based on what we 13 would see the overall impact would be of the program. So we haven't made 14 that final decision yet.

15 But again, it would be within the judgment. And where 16 there was no prescriptive formula would tell us X percent decrease therefore 17 you come to the Commission.

18 COMMISSIONER BARAN: Okay, thank you.

19 MR. LUBINSKI: If I could also add --

20 COMMISSIONER BARAN: Oh, sure.

21 MR. LUBINSKI: -- in response to one of the answers, 22 Commissioners, I want to recognize the folks who are on the working groups.

23 As Andrea said, when we asked them to put together this

39 1 task we asked them to come with their best thinking on what they felt was 2 important to bring to the table. And early on they were approaching it from 3 many different directions.

4 From looking at the ISAs, looking at their past experience, 5 looking at risk, but keeping a risk focus in mind as they came forward. And 6 what's interesting is, even coming from the different directions that they did, 7 many times the results seem to come in the same place rather quickly, where 8 the approaches that we're taking were different and then later there became 9 more alignment on the approaches and how they got there.

10 So I want to really complement the folks for the openness 11 that they brought. And then also, as Andrea said many times, being able to 12 do this in a public setting and making sure that we're inviting all of our external 13 stakeholders to public meetings so that we can hear any concerns that they 14 would have we felt was very important as well through this entire process.

15 COMMISSIONER BARAN: Yes, I appreciate that. Thank 16 you.

17 CHAIRMAN SVINICKI: Thank you very much.

18 Commissioner Wright.

19 COMMISSIONER WRIGHT: Good morning, thank you.

20 So good morning, everyone, it's been a good dialogue.

21 And before I get started I just want to recognize you for your 22 work on the Westinghouse. I mean, that's ten miles from my home, down in 23 South Carolina, and I've been paying very close attention to it.

40 1 And I really appreciate the way that the Region and the way 2 that you all have handled things in the public arena. You've been very 3 transparent and very open. And I just to just commend you for that. And 4 pass that back to the Region as well.

5 MR. LUBINSKI: Thank you. Jake, I'll you add to that.

6 I want to think a lot of what we're talking about today is a lot 7 of the safety aspects of the programs. But that's an area where we've 8 definitely looked at the environmental side.

9 And I want to complement the environmental folks for what 10 they've done on that outreach and the coordination we've had between 11 Headquarters and the Regions.

12 COMMISSIONER WRIGHT: Okay, thank you for that.

13 So, John, I'm going to start with you on this.

14 But I've enjoyed and appreciate the discussion on the risk-15 informed regulator stuff today. And back in October, at the transformation 16 meeting, I had some questions about this topic but I ran out of time, so I want 17 to kind of go back and start with that today if you don't mind.

18 In September you held the first office live Skype call --

19 MR. LUBINSKI: Yes.

20 COMMISSIONER WRIGHT: -- and about what it meant.

21 What modern risk-informed regulator meant at NMSS.

22 And so how did that go and what kind of comments did you, 23 and questions did you get from Staff, and how are you using the insights that

41 1 were gained from this going forward?

2 MR. LUBINSKI: Thanks, appreciate it. There was 3 actually a few things involved with that. And let me drop back before I talk 4 about the risk aspects.

5 I felt it was important that we were hearing feedback from 6 our Staff is that they wanted to have more interactions with the senior 7 managers in the office and how could they do that. We actually proceeded 8 that with what we called an executive team chat where we asked for just an 9 executive team and Staff and other management to be present for the 10 meeting. And we had about an hour and a half of just open dialogue.

11 It came out of that meeting as a recommendation of, let's do 12 something more inclusive like a Skype call. And that's how we came up with 13 a Skype side chat was from the Staff saying, let's do that.

14 I put it as very successful. At one point we had 137 people 15 on the Skype call. So there was a lot of engagement.

16 Now, were they there for the entire hour plus that we were 17 on the call, probably not. But it invited them to maybe be multitasking at their 18 desk while they were able to do it and still engage and get other work done.

19 And also feel that they didn't, if they stayed for ten or 15 20 minutes they could do that as well.

21 The topic, again, that came up with risk was, out of our initial 22 executive team chat where they said, tell us more on why we need to do this.

23 And that's where you see the graphic why we started with the whys involved.

42 1 And that was a lot of the discussion that started with the why.

2 That's what a lot of people engaged on. And the questions, 3 John, why do you believe this, Rob, why do you believe this.

4 And we shared our thoughts on why we believe that looking 5 from the standpoint of our external changes, the changing environment we're 6 in and that we need to be looking proactively at what the future looks like and 7 how can we effective and efficiently regulate in that environment.

8 Also, a lot of what we heard out of was what they say the 9 whys for why they felt they needed to change. And I thought that was 10 probably the most important because they were coming up with ideas of what 11 they saw as barriers. Whether it was in their current processes or in current 12 thinking on where to go.

13 And they came up with ideas about how to change our 14 processes, how to change our procedures as we continue to move forward.

15 In fact, after that we had asked for some feedback. And the response was, 16 we'd like to see this more.

17 And we had another call just last week on more the first 18 format where it was just an open dialogue. And a lot of that probably focused 19 more on personnel type issues.

20 COMMISSIONER WRIGHT: Sure. Thank you for that.

21 So, some of the challenges that I see in this risk-informed decision-making 22 arena, on the material side I guess is the, you've got diverse group of 23 licensees, you don't really have, I guess you lack a formal risk assessment

43 1 tools, like PRA and stuff, on the reactor side has.

2 You've got the ISA, but that really is for fuel cycle facilities.

3 Nothing for the other classes of licensees.

4 So, what do you see as challenges and how do you think 5 you can overcome those challenges to move the materials program toward a 6 more risked informed?

7 MR. LUBINSKI: So as you said, on the fuel facility side we 8 do have the ISAs, which helps. As we went into this, I'll give you my 9 perception is, even the industry on the fuel facility side was maybe a little bit 10 skeptical coming to the table about looking at the program overall and what 11 we were trying to do.

12 But I think the openness that we used and the fact that we 13 didn't look at the ISA numbers as being hard numbers the way we would look 14 at it in a PRA, opened everyone's eyes on both sides of the table that we had 15 to look at this not only quantitatively but qualitatively. And I think that's what 16 we take out that goes to other areas.

17 You'll hear in the next presentation, we'll talk a bit about 18 independent spent fuel, storage installations and what we're looking at there 19 from a risk-informed perspective.

20 Do we have PRAs, no, but do we have risk studies that were 21 done in those areas, yes. And that's what we're relying on is, where do we 22 have hard numbers from a risk standpoint.

23 And then also in that area we've tried to equate that to other

44 1 regulatory programs. We looked at, does this facility, what does it look like, 2 what does it act like, what are the risk associated most similar to in other areas.

3 In the fuel facility, some of that relates more to reactor 4 programs, which is why we look very much at corrective action programs 5 because they're required for the reactors, not for the fuel facilities.

6 For ISFSIs, we looked more towards the material programs 7 and said, what do we have in the materials area.

8 About six months we had a program briefing on our nuclear 9 materials users' program, and we're looking in that area to how do we risk-10 inform in that area as well. That's very qualitative.

11 And I think the approach though is using the experts, as we 12 did in this area, where you bring in your inspectors, your licensing folks, those 13 who have been to the sites, to bring their insights to bear.

14 And something Andrea said is, when we talked about 15 flexibility in a program in providing flexible hours, and I would agree with 16 Andrea, I see it this way, that the best way to look at flexible hours is allowing 17 the person who was there has their boots on the ground, is there seeing it 18 firsthand, training them from the standpoint of qualitative insights in the way 19 they approach their job to then use their judgment on site of where they should 20 be focusing their hours and efforts based on the experiences they have.

21 COMMISSIONER WRIGHT: All right. And I appreciate 22 value my fellow Commissioner's concern about the reduction hours or shifting 23 of hours and things like that, but I guess my question, I don't know that, and

45 1 to me I don't, am I wrong, if you're looking at re-calibrating and changing the 2 way that you're basically looking at the quality of the inspections that you're 3 doing, not necessarily the number of hours that you're putting in just to do 4 inspections, would that be --

5 MS. KOCK: So what I, I agree with you. And the way I 6 keep putting it is, we are looking at what is needed. What is needed for an 7 effective oversight program. Not necessarily a reduction or an increase but 8 what do we need to do in order to do our job effectively.

9 COMMISSIONER WRIGHT: Right.

10 MS. KOCK: And not do too much and not do not enough.

11 COMMISSIONER WRIGHT: And where that falls is where 12 that falls.

13 MS. KOCK: That's right.

14 COMMISSIONER WRIGHT: Okay. I was just trying to 15 understand that.

16 MR. LUBINSKI: And another point that I think is important 17 as we talked about that part of the program and the flexibility is, we really are 18 trying to engage that the flexibility part of the program is a proactive approach, 19 where when we're looking at the site we're looking at what I'll call, what could 20 be called precursors along the not an event response type flexibility.

21 With that said, all the programs are still going to have that 22 aspect of the program that there will be a reactive part and we will respond.

23 But the more important part is to have the proactive part first and have the

46 1 flexibility part of the program be proactive.

2 COMMISSIONER WRIGHT: Right. Okay. Thank you.

3 Hey, Jake, how are you? So, your branch seems to have 4 a lot of new and novel work coming its way so, and it's kind of exciting too and 5 I wish you luck as you tackle that.

6 You mentioned how you used the strategic workforce 7 planning process to prepare for the X-energy and medical isotopes facility 8 reviews. Can you share with us your experience or the divisions experience 9 in implementing that process? How did it go or how is it going?

10 MR. ZIMMERMAN: So far, I think it's gone well. There is 11 obviously some growing pains with it but I think it's a useful tool long-term 12 when you start to look out five years in advance of what applications or types 13 of technologies you may have to deal with and then you start to dial down and 14 look into, what are the critical skills that you're going to need and then look at 15 your current staffing and then combine that with the budget that you're going 16 to have to project out and then marry that up.

17 So, I've used different strategic workforce planning tools in 18 the past. I think this one goes a little bit further and provides a little bit more 19 detail.

20 But there is still more work that remains, but so far I've found 21 it to be a useful tool.

22 COMMISSIONER WRIGHT: Have you considered any 23 other novel ways of carrying out the projects like agile teams or skills

47 1 marketplace? Have you --

2 MR. ZIMMERMAN: I have not looked into, I personally 3 haven't looked into the skills marketplace. Now that we've merged and we're 4 still forming, I think what we're looking for right now is the opportunity to cross 5 train Staff on the storage and transportation, which there are very similar 6 common skills, they just haven't worked in fuel facilities and vice versa.

7 So, I think right we're first targeting within. And right, we 8 haven't yet identified a need to go external.

9 So I think merging the division has allowed us to centralize 10 some common critical skills. And so, we want to take advantage of that first.

11 COMMISSIONER WRIGHT: Okay.

12 MS. KOCK: Can I just add --

13 COMMISSIONER WRIGHT: Sure.

14 MS. KOCK: I can't help myself.

15 COMMISSIONER WRIGHT: Please.

16 MS. KOCK: I've tried to, but --

17 (Laughter.)

18 MS. KOCK: The idea of agile teams is something that's 19 come up multiple times through the agency's transformation efforts. And is 20 one of the common themes that's going up in the review of the fuel cycle 21 licensing program that we're doing now, in terms of the need to bring people 22 together early in the process, to identify what's really important, has really 23 helped us on several projects. And it is a common theme that's coming out

48 1 of our licensing review.

2 And so, it was something that we're looking very closely at 3 as we review and revise our licensing guidance.

4 COMMISSIONER WRIGHT: Thank you. And by the way, 5 congratulations on your new role and we look forward to big things coming 6 from you in that branch.

7 MS. KOCK: Thank you, I think.

8 (Laughter.)

9 CHAIRMAN SVINICKI: But no pressure.

10 (Laughter.)

11 CHAIRMAN SVINICKI: Well, my colleagues have covered 12 a lot of the topics here. Maybe I'll just return to some of these areas and ask 13 some additional background information.

14 You know, I often comment that the strengths of our 15 Commission is that we do have different perspectives. And people come at 16 things and kind of the questions they ask are not exactly the same questions 17 that you would ask.

18 But I think at the end of the day, similar to what Andrea has 19 described with the teams working on some of the initiatives here and you've 20 got a lot of different perspectives. You have people with different experience 21 levels and different backgrounds in the room.

22 And in general, I think the rock polisher of that kind of 23 process gets you with a pretty good public policy outcome. Generally. You

49 1 know, if people are respectful and kind of not withholding their concerns and 2 things like that.

3 So, I might ask you, Andrea, in terms of the, we're spending 4 some time talking about inspection hours today so I'll ask a little bit about that.

5 Is it your understand that the level of inspection hours, as 6 they are set now, different from anything the Staff might be thinking about 7 proposing, is it your sense those were arrived at in the kind of systematic, 8 holistic type of review that's being done now?

9 I mean, maybe you weren't there, but is your sense of the 10 background that a team was given the opportunity to really look at it or, and 11 again, kind of integrated across.

12 And I know there is this narrative about the fact that while 13 we're looking to cut hours, I can speak only for myself but I will tell you that 14 that is not my understanding on the reactor side or the programs we're talking 15 about today.

16 I'm not aware that any NRC team has been, and if they have 17 been given this direction I want to know about it, that they have been told, 18 you've got to come up with a design that cuts X percentage or does something 19 like that. That's not my understanding of what's happening here, so, my 20 sense is they're going, they're doing another fresh look at the relative risk, as 21 we see it, not as the public sees it.

22 And I understand that's a sensitive point. You mentioned 23 effluent. I know for many communities, actually, my colleague here could

50 1 probably speak to this very knowledgeably, very low risk effluence off the sight 2 are very concerning to communities. But as the nuclear safety and 3 environment experts on this particular facility, we would say criticality or we 4 would say some other areas where we would be giving our closest look or 5 maybe spending the bulk of our inspection hours.

6 So, can you talk a little bit about how the team began?

7 Was it really just to do the risk informing view or were they 8 told that there was some other outcome or goal here?

9 MS. KOCK: So I'm going to agree with you that the team 10 was not given direction, that this is a reduction. That is not my expectation at 11 all and is not something I would propose.

12 The charter for the work was actually very kind of open 13 ended for a purpose, and that purpose was to the holistic look at the program 14 based on risk informing our approaches. So, yes, it was more of an open 15 look.

16 And as far as your question, in terms of how did we set the 17 hours1.967593e-4 days <br />0.00472 hours <br />2.810847e-5 weeks <br />6.4685e-6 months <br /> that we have today versus, so my sense is, I mean, the great thing about 18 the NRC Staff, and I think we're usually in about the right place, so the program 19 is not broken.

20 And I think that the hours that we came up with, that exist 21 today, were based on our experience and there's nothing wrong with them.

22 But I don't think that they were developed based on a systematic review, like 23 we're doing now.

51 1 CHAIRMAN SVINICKI: Do you think that if we left all those 2 things just where they are today, that that would be better or worse for safety 3 than doing the kind of, and I don't mean to, I'm trying to ask a neutral question 4 and I'm struggling with it a little bit, but do you think if we locked all those points 5 of emphasis and the corresponding hours in place for the next ten years, do 6 you think that that is more enhancing to safety than taking this kind of look and 7 making adjustments?

8 MS. KOCK: So, again, I don't think that the program is 9 broken, but based on what we've seen so far from the working group, I think 10 that there are areas where we're overspending effort and I think there are 11 some areas where we're not expending enough efforts, and that's not what's 12 best for safety. That's not --

13 CHAIRMAN SVINICKI: Are you confident that given the 14 composition of members on this team, and Robert I think you said was one of 15 those members, do you think that if they felt overall that the set of ideas being 16 advanced to executives here at the Agency, at this point, if they had concerns 17 about it, are you confident that they would speak up?

18 MS. KOCK: I am 100 percent confident that they would 19 speak up because we have had a wide diversity of views. And as John 20 alluded to, you know, where the team started versus where they end up, there 21 was a lot of different views and a lot of work put in to come up with where we 22 are today.

23 And my experience, again, with the NRC Staff is they're not

52 1 shy, we are not shy. People do speak up. And I always we need to listen to 2 those views, understand them fully and then make a decision.

3 CHAIRMAN SVINICKI: Robert, I'm going to put you on the 4 spot here. Do you want to talk a little bit about that dynamic in the team?

5 If it's difficult to say, do you agree with Andrea, but maybe 6 just tell me your testimonial of the group. Was it pretty, kind of a free 7 conversation amongst experts?

8 MR. WILLIAMS: Yes, I'll definitely agree with the way 9 Andrea presented it. We had a diverse viewpoints, and even early in the 10 public meetings that we've presented some of the ideas, we've presented I 11 think a total of four different options before we finally centered on the last 12 option that we presented.

13 So we've been, along this whole process, approaching it 14 from all different angles. We had a lot of initial disagreement about the, 15 where the focus area should be. A lot of constructive conversations 16 happened.

17 And the team, as a whole, just came together, worked 18 cooperatively and had the same mission in mind of maintaining safety, right 19 sizing the program and putting the efforts where we thought they would best 20 be needed.

21 MR. LUBINSKI: Chairman, if I could add. Early on, as 22 Andrea said, there was questions, why are we doing this, what are we trying 23 to achieve, where are we trying to go, what are the goals.

53 1 And I do remember one of the specific questions asked is if 2 the result of this evaluation comes back and says, there are no changes to the 3 program, would that be an acceptable answer. And I remember my answer 4 is that being two part.

5 One is, yes, that could be an acceptable answer. But then 6 I said, but don't come back in ten minutes and tell me that that's an acceptable 7 answer, you need to be open to saying, not just this has always worked, it's a 8 program that's not broke, why are we trying to fix it, do an evaluation.

9 So, people did ask that question right up front and said, if 10 there are parts or the whole thing is fine the way it is and we think we have a 11 basis for it, should we do that. And I would say that I appreciate that 12 openness to do that.

13 I do think as being, looking at the program over the years 14 and your question about, was this kind of rigor put in, I'd say, there was some 15 level of rigor put into the initial programs and it has continued to be modified 16 over the years.

17 I was involved in some of that in the early 2000s in looking 18 at the program. But what we didn't have is a lot of the current risk insights 19 we have today, such as the insights from the ISAs. And not just the ISAs, but 20 the reviews of the ISAs, the inspection of the ISAs.

21 So our Staff learned lot over the last 20 years about how to 22 look at these plans from a risk perspective. And that's what I think is being 23 added in this assessment now were the folks who are looking at it today are

54 1 more educated on what we mean by risk insights, not so much a deterministic 2 review in developing those programs.

3 CHAIRMAN SVINICKI: With that, maybe I'll just have you 4 pause on that point because that could sound a bit theoretical. And so, 5 maybe I'll ask you this question.

6 Do you think that with the experience we have now with the 7 integrated safety assessments, I'm not sure we've defined that yet in the 8 conversation, the ISAs as we're calling them, does it bear relevance and 9 correlation to the events? Kind of the noteworthy events we've seen at these 10 facilities in recent years.

11 And I would see that if there is not a good correlation 12 between where the ISAs would draw your attention as a safety expert and 13 what we're really seeing at these facilities, then I think folks may legitimately 14 say, well, I worry about the effect of making changes that are rooted very 15 theoretically in the ISAs, how do you respond to that?

16 MR. LUBINSKI: So I would, just on my own personal 17 experience, I can say just recently looking at where my mind set was 20 years 18 ago and looking at some of the risk associated with something like UF6 19 cylinders and drops, which when I came into the program was trained that that 20 is the worst hazard that you could ever have at one of these plants.

21 However, now looking at the ISA insights and what we 22 reviewed, there was recently an incident where rigging on, when it was being 23 placed, moved, and the question was, what's the significance of that. We

55 1 were able to go back and look at the ISA and say, you were dealing with a 2 cold cylinder, it was in place over top of the rack where it was supposed to be, 3 this is not a risk significant issue.

4 So it's a change in thinking where we actually have an 5 analysis that was done to tell us we're in the right place today. Which is 6 different than I think some of us would have thought 15, 20 years ago.

7 CHAIRMAN SVINICKI: Well, and I appreciate that. And I 8 think an added complexity here, not that it isn't complex on the reactor 9 oversight side, but we have fewer of these facilities that we're regulating in this 10 category, and they differ from each other in terms of the operation and the 11 hazard.

12 So, it does, I think, challenge the Staff in terms of coming up 13 with templates for inspection hours or even a program overall. That being 14 said, that's not a reason to declare defeat. There are approaches here that 15 allow you to look at similar hazards across this class of facilities.

16 And I appreciate the Staff, they work they're doing here. I 17 encourage anyone in these working groups to speak up and to have a really 18 good dialogue among experts.

19 I think that we do want to move in a risk-informed way. But 20 one of you, it might have been Andrea talked about, the wonderful insights 21 that the Staff that's been doing this work for a long time, particularly out in the 22 Region where we've got folks very present at these facilities frequently I think 23 I important.

56 1 And I know from my time here, I'll speak for myself, but I 2 think the Staff moves with a lot of trepidation and caution in making changes.

3 I find that to be somewhat of the organizational bias here. Not bias in a bad 4 way but bias in favor of safety and security that has the Staff moved in a very 5 deliberative and measured pace.

6 And from my part, that's what I observe you doing here. A 7 lot of outreach, a lot of input. So I fully expect that you'll continue moving 8 forward in that vein. John, did you want to have a quick last word?

9 MR. LUBINSKI: Thank you, Chairman. If I can say, we've 10 talked a lot about the program today and we've done in the evaluation and, 11 again, complementing the folks in the program.

12 And the biggest reason, the complement, it was not just the 13 great work but this was a difficult project to take on. Because again, we're 14 trying to look at it differently.

15 It's not easy. As Robert said, when the team got together 16 originally there were a lot of differing views on how do you even approach the 17 project to begin with, so we've appreciated that.

18 So, it's not an easy answer and we recognize that, but that's 19 why we're also taking the extra time. We were hoping to have this project 20 completed a month or two ago, but the folks came back and said, no, we need 21 to get this right, we need to take the time to do. And we've supported that 22 because we need to get the right answer.

23 CHAIRMAN SVINICKI: Okay, I appreciate that very much.

57 1 And I think we are taking a quick break here before the next panel.

2 So, we will reconvene at 10:20 and we'll reset the table.

3 Thank you.

4 (Whereupon, the above-entitled matter went off the record 5 at 10:14 a.m. and resumed at 10:20 a.m.)

6 CHAIRMAN SVINICKI: Well, we are reconvening now to 7 hear from the second of our panels, which I don't think has a complicated 8 name, but let me make sure that I get the business line correct. Spent Fuel 9 Storage and Transportation Business Line. And we are hearing from one of 10 the same panelists, and that is Mr. Lubinski. I will ask you to take it away.

11 Thank you.

12 MR. LUBINSKI: Thank you again, Chairman and 13 Commissioners. With me at the table for our second panel are Chris Regan, 14 the Deputy Director of the Division of Fuel Management, NMSS. We also 15 have John McKirgan to Chris' right, who is the Chief of the Spent Fuel and 16 Transportation Licensing Branch. And to my left we have Linda Howell, who 17 is the Deputy Director of the Division of Nuclear Material Safety in our Region 18 IV Office. We would like to provide the Commission with a strategic 19 discussion of the current spent fuel storage and transportation business line.

20 As we mentioned during the first panel the division merger 21 is expected to result in benefits in terms of Staff agility and strategic workforce 22 development. These benefits also apply in the spent fuel storage and 23 transportation business line.

58 1 Many of the themes we will discuss are similar to what 2 you've heard for the previous panel although the activities are different. This 3 is an expected and intentional result of agency-wide strategic direction.

4 Next slide. The work within the spent fuel storage and 5 transportation line continues to be significant in terms of breadth and scope.

6 It includes licensing and oversight of spent fuel storage at 76 sites in 35 states 7 including two applications for consolidated interim storage. It includes 8 certification of transportation packages for more than 3 million shipments of 9 radioactive material each year. It includes international support on technical 10 and regulatory issues and it includes engagement with multiple diverse 11 stakeholders outside the Agency including tribes, states, the Department of 12 Energy, Department of Transportation and other federal agencies and non-13 governmental organizations.

14 We are effectively responding to a changing environment.

15 These changes include a renewed interest licensing of consolidated interim 16 storage facilities and increased and accelerated decommissioning resulting in 17 increased movement of spent fuel into dry storage.

18 We are on track to complete our safety and environment 19 reviews of the two consolidated interim storage facility applications by mid-20 2021. We also approved a number of applications for transporting fresh 21 accident-tolerant fuel lead test assemblies to support use in reactors. Staff 22 is preparing for transportation applications for batch loads of accident-tolerant 23 fuel by identifying specific licensing and technical focus areas.

59 1 In response to the environment we are making efforts to 2 engage a wider set of stakeholders in new forms. For example, this year we 3 held our annual Spent Fuel Management Regulatory Conference near our 4 Region I Office and held an evening stakeholder engagement session where 5 we heard from a wide range of stakeholders including members of the public 6 on spent fuel storage and transportation issues.

7 Next slide. In this business line we are continuing to make 8 progress becoming a modern, risk-informed regulator through implementation 9 of process improvements. In September the Staff completed a pilot review 10 of the application for a graded approach that applies risk insights to determine 11 the appropriate level of detail required for the certification of compliance 12 technical specifications. We plan to incorporate the insights from the pilot 13 into guidance for new applications. The Staff expects the effort will make the 14 storage licensing process more effective by reducing the certificate 15 amendment burden on industry based on the safety significance of the issues.

16 Also we initiated a working group to perform an assessment 17 of the current Independent Spent Fuel Storage Installation Inspection 18 Program. The group evaluated inspection efforts based on their safety 19 significance. We are in the process of evaluating the recommendations.

20 I will now turn to Chris Regan for his part of the presentation.

21 MR. REGAN: Thank you, John.

22 Good morning, Chairman and Commissioners. I will be 23 providing an overview of significant spent fuel and transportation business line

60 1 activities.

2 Next slide, please. As mentioned during the fuel facilities 3 business line briefing earlier this morning, Staff assessed the current 4 regulatory framework related to the use of accident-tolerant fuel and fuel with 5 higher enrichment and developed a comprehensive agency plan to enable 6 their use.

7 At the upper right of this slide is a picture of silicon carbide 8 accident-tolerant fuel. The agency plan includes the necessary actions to 9 support the industry's goal of 2023 deployment of accident-tolerant fuel from 10 both the fuel facility and transportation perspective. For transportation we 11 evaluated our regulations to determine if review of the technologies will require 12 rulemaking. In the vast majority of cases no changes to our regulations are 13 needed to accommodate the new technologies.

14 To facilitate 2023 deployment of accident-tolerant fuel with 15 higher enrichment below 10 percent NMSS must receive an application to 16 revise a certificate of compliance from a vendor for transporting UF6 by August 17 2021. For fresh fuel transportation NMSS must receive an people to revise 18 the certificate of compliance no later than January 2022. As of today we not 19 received any formal applications or letters of intent, but we continue to invest 20 in the openness principle communicating clearly our expectations for timely 21 submittal of license applications and identifying challenges early to internal 22 and external stakeholders.

23 We are also preparing to address other changes in the

61 1 areas of spent fuel storage and transportation. In this capacity we conducted 2 an initial assessment of spent fuel transportation oversight inspection 3 readiness for the potential future needs of industry to transport spent fuel to a 4 consolidated interim storage facility.

5 Based on the initial assessment the Staff determined that 6 the current inspection program adequately addresses the potential future 7 needs, but that there are opportunities for enhancements. Specifically, the 8 program could benefit from additional inspection procedures or guidance in 9 current procedures and associated training that addresses a way from reactor 10 independent spent fuel storage installations or any unique aspects of 11 shipment preparation activities for spent fuel transportation.

12 We recently presented the Staff's assessment at the spent 13 fuel storage inspector counterpart meeting and the spent fuel regulatory 14 conference to solicit stakeholder feedback. Staff is currently developing our 15 path forward and coordinating with other affected NRC offices.

16 In coordination with our tribal, federal and state partners we 17 also observed and participated in two transportation tabletop exercises: the 18 NEI Transportation Tabletop in May 2019 and the Midwest Council of State 19 Governments Tabletop in November 2019. These tabletop exercises 20 allowed participants and observers to gain a better understanding of the spent 21 fuel transportation planning and implementation processes through dialog, 22 information transfer and decision making on legal, regulatory and process 23 requirements, as well as stakeholder interests.

62 1 In the lower right picture you can see a transportable spent 2 fuel cask.

3 Next slide, please. We are optimizing our licensing and 4 inspection practices to ensure we are prepared for the future. Some 5 examples include the completion of guidance documents to prepare for 6 workload associated with the safety review of license and certificate renewals 7 beginning in fiscal year 2020 as the number of certificates approach the end 8 of their initial 20-year term. We are setting the stage for future by revising our 9 guidance to ensure it can be easily adapted when necessary and we are 10 adding clarity and efficiency to the licensing process through consolidation of 11 several separate Standard Review Plans and Interim Staff Guides into two 12 documents.

13 In addition, we accommodated early review of renewals 14 from Humboldt Bay, Holtec International and TN Orano by following recently 15 issued guidance in NUREG-2214, Managing Aging Processes and Storage, 16 which facilitates a more efficient review by identifying credible aging 17 mechanisms for the components of most of the dry cask -- dry storage casks 18 designs in the U.S.

19 Earlier this year the Staff presented the final report on 20 NUREG-2224, Dry Storage and Transportation of High-Burnup Spent Nuclear 21 Fuel, to the ACRS Subcommittee on Metallurgy and Reactor Fuels. NUREG-22 2224 is new guidance that delineates acceptable conditions for spent nuclear 23 fuel with higher burnup in storage and transportation. These conditions will

63 1 limit degradation during storage and transportation evolutions.

2 In addition, the NUREG provides guidance on how to 3 demonstrate that the conditions will be maintained and applicable for higher 4 burnup fuel. The Staff is finalizing the document and publication is expected 5 by the second quarter of FY 2020. The issuance of the NUREG is expected 6 to assist licensees to more efficiently and effectively prepare applications for 7 the safety and transport of high-burnup spent fuel and assist license reviewers 8 in their evaluation of these applications.

9 We are also ensuring a shared understanding of what facility 10 changes can be made without the need for prior NRC approval as afforded by 11 the provisions in our regulations. The Staff is working to endorse industry 12 guidance NEI 12-04, Guidelines for 10 CFR 72.48 Implementation, which 13 delineates methods and approaches that are considered acceptable for 14 complying with the regulation. Specifically, endorsement of NEI 12-04 15 will clarify that licensees or certificate holders for spent fuel storage systems 16 can use methods of evaluation used in establishing the design bases across 17 certificates of compliant amendments without the need to seek NRC approval.

18 This clarification will potentially reduce the number of certificate amendments 19 received by the NRC for review.

20 This effort, together with the graded approach pilot, 21 complement each other by focusing on the more safety-significant aspects of 22 certificate reviews and clarifying the flexibility that exists for certificate holders 23 to make appropriate changes without the need to request amendments while

64 1 still maintaining safety. We are currently assessing an innovative approach 2 to facilitate early implementation by industry of the guidance contained in NEI 3 12-04 while we finalize our endorsement in the Regulatory Guide.

4 Recognizing the likelihood for an increase in the number of 5 design changes made by licensees without prior NRC approval through 6 application of the guidance contained in NEI 12-04 and to assure appropriate 7 regulatory oversight of all design changes made by licenses, the Staff also 8 completed development of draft inspection guidance that will further inform 9 and proceduralize the process for sampling of license design change 10 screenings and evaluations so as to focus on the changes that have the 11 greatest potential to increase risk.

12 Next slide, please. As I mentioned, we completed an 13 assessment of the current Spent Fuel Storage Inspection Program to ensure 14 we are focused on the items of highest safety significance and apply our 15 resources in a smart manner and which accounts for the operating experience 16 we've obtained to date. This will be important given the expected continued 17 increase in the movement of fuel into dry storage as decommissioning is 18 accelerated.

19 A working group comprised of Staff from all four Regions, 20 NMSS and NRR used operating experience and risk insights to eliminate 21 overlaps with other procedures, develop more realistic estimates of the time it 22 takes to complete inspections and optimize resource use to focus effort on the 23 most critical aspects of the oversight program.

65 1 To ensure we proceed in a fully informed manner, we had a 2 public meeting just this past Monday to solicit stakeholder feedback and we 3 plan to finalize our recommendations and complete implementation of 4 program revisions by Fiscal Year 2021.

5 This concludes my part of the presentation. Now I'll turn it 6 over to John.

7 MR. McKIRGAN: Thank you, Chris.

8 Good morning, Chairman, Commissioners. I'll provide you 9 an overview of the spent fuel safety and transportation licensing activities with 10 a focus on how we're promoting transparency in a dynamic environment while 11 we continue to work toward becoming a modern risk-informed regulator to 12 achieve our mission more effectively.

13 Next slide, please. We continue to effectively and 14 efficiently license spent fuel storage facilities and transportation containers.

15 The number of completed licensing actions was up roughly 20 percent from 16 last year while the budget for the licensing product of the business line was 17 relatively flat, illustrating an enhancement in the efficiency of our program.

18 Specifically, this year we completed 66 transportation 19 certificate approvals and 15 storage licensing actions including two storage 20 renewals: Trojan and Three Mile Island 2, TMI-2. The TMI-2 ISFSI is pictured 21 there in the bottom right of the slide. Fiscal Year 2020 is a big year for 22 renewals with an anticipated record number of submittals planned. As we'll 23 discuss later, the Staff is well-positioned to review these incoming renewals.

66 1 During this past year the business line completed a number 2 of significant licensing actions. These include expedited reviews of a number 3 of storage cases to support decommissioning activities and a number of 4 transportation cases to support the shipment of accident-tolerant fuel.

5 Examples include the MAP-12 transportation package, also pictured at the top 6 right on the slide, to ship accident-tolerant fuel chromium-coated lead test 7 assemblies. On the storage side of the house the review of the HI-STORM 8 100 Amendment 14 supported the Pilgrim decommissioning schedule.

9 Next slide, please. We are promoting transparency by 10 proactively engaging with industry and external stakeholders to enable timely 11 licensing decisions. Concurrent consolidated interim storage facility 12 application reviews coupled with accelerated decommissioning of power 13 reactors has emphasized the importance of timely regulatory decision making 14 and the proactive engagement of stakeholders is a key element. As such, 15 we've continued periodic communications with licenses and certificate 16 holders. The Staff is actively seeking and obtaining advanced notice of 17 upcoming licensing actions and industry schedule drivers that substantively 18 inform our workload prioritization.

19 We are obtaining early insights on upcoming amendment 20 requests through review of industry responses to our generic communications 21 and periodic scheduling dialogues with vendors. Additionally, the Staff has 22 augmented its outreach activities to accommodate the increased engagement 23 from interested parties and stakeholders for both CISF applications through

67 1 responses to written inquiries, Congressional staff briefings and government-2 to-government interactions with the State of New Mexico and the Wyoming 3 legislature.

4 In September we testified at the Wyoming legislative 5 session regarding the NRC's role and regulations related to the storage of 6 spent fuel. We have also gathered the most common questions and 7 significantly enhanced our public web page to provide plain language 8 responses to these technically-complex issues. We continue to provide cost 9 and schedule estimates at the beginning of each licensing action. This 10 proactive engagement has facilitated timely decision making.

11 We are making substantive progress on the technical review 12 of Holtec and Interim Storage Partners CISF applications. Based on the 13 latest information from our applicants we have issued revised schedules for 14 the reviews of the two CISF applications. Based on this latest information the 15 Staff plans to complete its review of both applications in mid-2021.

16 We are currently within our project budget expenditures for 17 both reviews. We have completed several key milestones on these projects 18 including publication of the scoping comment report as part of the 19 environmental review. We are progressing on the draft Environmental 20 Impact Statements or EISs for both applications. We've issued the first round 21 of safety and environmental requests for additional information for both 22 projects, begin consultation and tribal interactions and completed a number of 23 public meetings.

68 1 The next key milestone in the project will be the publication 2 of the draft EISs for public comment. This is scheduled for March 2020 for 3 Holtec and May 2020 for ISP. We anticipate significant public interest in 4 these documents and are preparing public meetings near the facilities to 5 present our draft documents and to receive public comments.

6 Next slide, please. We're continuing to safely license 7 transport packages while exercising agility in a dynamic industry environment.

8 Some examples include the completion of an exigent letter authorization to 9 ship a damaged cesium source safely. The Staff performed a timely safety-10 focused review of the modified RH-TRU radioactive material transportation 11 package, pictured here, to meet the industry needs in moving the damaged 12 source to a safe and secure location. The damaged source had resulted in 13 exposures to workers and needed to be moved quickly to a facility that had 14 the equipment to handle it. The Staff engaged constructively in 15 effective dialog with the transportation package vendor as they described the 16 necessary modifications to the package that would ensure safe transport. In 17 an integrated team approach the Staff worked together across technical 18 disciplines addressing the different aspects of structural and shielding 19 elements of the modifications. As a result the Staff was able to issue the 20 letter authorization enabling the timely movement of the damaged source.

21 Another example is the completion of an expedited 22 exemption request to Arizona Public Service Company for Palo Verde to allow 23 a modification to the technical specifications of the MAGNASTOR spent fuel

69 1 storage cask. The review of this request was accelerated to accommodate a 2 planned outage by the plant. The Staff's timely review enabled the plant to 3 maintain a full core off-load capacity.

4 This request also demonstrated the need for the graded 5 approach pilot on the content of the CoC and technical specifications that I'll 6 talk about in the next slide. The level of detail in the tech specs which 7 precipitated this exemption request is the kind of issue that the graded 8 approach will help Staff and industry avoid in the future.

9 We were successful in these cases by exercising our work 10 prioritization guidance and leveraging our IT planning and scheduling tools to 11 complete these high-priority cases with only minimal impact on other case 12 work. Our prioritization guidance provides a framework that ensures that the 13 most critical and important cases are handled appropriately. We are 14 improving renewal reviews through the use of the MAPPS report and 15 leveraging contractor resources to assist with technical reviews of renewal 16 applications to address surge capacity.

17 As mentioned, our IT planning and scheduling guidance is 18 a key component of our work flow management capabilities and our success 19 in exercising agility. We use STIMS, a module of web-based licensing, to 20 allow frequent checking and adjusting of resources as incoming casework 21 demands shift. We have added the capability to track and report on our 22 NEMA metrics with STIMS.

23 Strategic workforce planning has helped the business line

70 1 identify future workforce gaps in the nuclear criticality and shielding areas and 2 we have used the summer intern program to identify top candidates and are 3 very excited about the N-RAM Program to help ensure future success of the 4 program.

5 Next slide, please. We are making progress in becoming a 6 modern risk-informed regulator through further incorporating risk insights into 7 our reviews. Some examples of the specific licensing actions where this 8 mind set is shifting include the graded approach pilot amendment that I just 9 mentioned.

10 The graded approach is a major initiative for the Staff and 11 industry. In completing the graded approach pilot the Staff evaluated 99 12 items in the current certificate of compliance and used a systematic risk 13 screening to determine if the element needed to be included in the certificate.

14 As a result of our efforts 16 items were removed from the certificate either due 15 to being low risk or being duplicative of another requirement. A further 52 16 items were rearranged or relocated and six items were removed from the tech 17 specs to the final Safety Evaluation Report. This will provide licensees the 18 flexibility to make changes in these low-risk areas without requesting 19 unnecessary amendments.

20 Next steps include the revision to Staff guidance documents 21 including our format and content guidance and the Standard Review Plan for 22 dry cask storage systems. While those guidance documents are being 23 processed Staff intends to issue a letter to the industry endorsing the use of

71 1 the graded approach.

2 The Staff is also interacting with industry on an industry 3 white paper to lay out a strategy for optimization of the storage certification 4 process. Specifically, NEI is seeking to continue a dialog to enhance 5 efficiency in spent fuel storage reviews by providing further guidance on the 6 identification of performance margins in the areas of source term, thermal 7 parameters, radiological parameters, fuel qualification and criticality. Staff 8 continues to be very open to the potential enhancements that would also 9 maintain adequate safety.

10 This was a topic of discussion at the recent Spent Fuel 11 Regulatory Conference back in September. Industry has submitted a white 12 paper in November and we held a public meeting to discuss the document on 13 November 18th.

14 The Staff also attended several meetings being led by EPRI 15 this past October to further understand fuel characteristics for the purpose of 16 identifying margin. The Staff will be reviewing EPRI reports for insights where 17 margins might exist that can be credited in our reviews.

18 We are building on agency best practices, re-instituting a 19 topical report process that is expected to reduce undue engagement of 20 regulatory resources by requiring fewer amendment submissions once a 21 topical report approving a general design or approach is approved.

22 A vendor has discussed with NRC their plans to submit a 23 topical report for allowance of candidate heat load patterns without an

72 1 amendment request. The applicant discussed their plan to propose a 2 suitable methodology permitting licensee selection of candidate heat load 3 patterns without the need for a license or certificate of compliance 4 amendment. It is the applicant's intent that the topical report would receive 5 NRC approval and that the approved methodology would allow the vendor and 6 its clients to address emerging plant needs in a timely manner. The details 7 of the report are still being developed and the Staff held an additional pre-8 application meeting in November before the submittal of the document.

9 I'll now turn it over to Linda.

10 MS. HOWELL: Thank you, John.

11 Good morning, Chairman and Commissioners. My portion 12 of the presentation will focus on the Spent Fuel Oversight Program. I want to 13 focus on three areas: collaboration between the Regions and Headquarters, 14 engagement with stakeholders, and then preparing for the future in the Spent 15 Fuel Oversight Program.

16 Next slide, please. The Regions and Headquarters 17 routinely collaborate to ensure that NRC's oversight program for spent fuel 18 storage and transportation is implemented effectively. During the past year 19 however substantial collaboration has occurred between the Regions and 20 Headquarters due to the significant oversight efforts expended evaluating 21 complex technical issues at one spent fuel storage facility and in processing 22 two significant escalated enforcement actions involving a spent fuel licensee 23 and a vendor.

73 1 The collaboration included the use of multi-disciplinary 2 teams involving Headquarters and Regional staff to review technical issues 3 involving spent fuel loading at one facility, as well as inter-regional resource 4 sharing to cover routine spent fuel storage inspections in Region IV while our 5 technical staff was fully engaged in follow-up inspections relating to an 6 escalated enforcement action involving an event that occurred in 2018. Our 7 Headquarters inspection team also engaged in follow-up inspection of vendor 8 activities following issuance of an escalated enforcement action to a vendor 9 earlier this year.

10 The outcome of these collaborative efforts included 11 expanding our ability to provide effective and enhanced oversight and 12 resolved significant technical issues, maintaining oversight of initial and 13 ongoing spent fuel loading operations at many sites during a period when 14 resources were challenged, and enhanced learning opportunities and 15 knowledge transfer among the technical staff assigned to inspection and 16 licensing of spent fuel storage facilities. In addition, the exchange between 17 Regions provided opportunities for new eyes to examine procedures and 18 operations at several facilities during the past year, which always enhances 19 and strengthens our inspection and oversight programs.

20 Next slide, please. Substantial public outreach was 21 coordinated over the past year to communicate technical information and 22 inspection and enforcement findings associated with one spent fuel licensee 23 and a spent fuel storage system vendor. Public outreach efforts were

74 1 conducted in response to interest expressed by the public and Congressional 2 stakeholders regarding technical issues associated with the enforcement 3 actions that I previously mentioned as well as the interest in future spent fuel 4 loading activities at one specific site.

5 The Staff leveraged use of technology by conducting 6 meetings via the Internet to share information with the public in a very timely 7 manner. By scheduling public inspection briefings in this manner we were 8 able to share inspection observations with members of the public, particularly 9 those in local communities, in advance of publication of the formal inspection 10 reports. Use of webinars also allowed us to capture questions and feedback 11 from public stakeholders and be more responsive to their requests for 12 information.

13 We used this technology to broadcast a pre-decisional 14 enforcement conference which provided an opportunity for the public to have 15 a level of involvement beyond what is typically experienced by listening over 16 a conference bridge. These opportunities to observe Staff briefings and 17 obtain information more quickly as inspection activities progressed and 18 Agency decisions were made regarding enforcement action and the Agency's 19 conclusions on spent fuel transfer operations at a site were well received by 20 the public.

21 We participated in several community engagement panel 22 meetings in the vicinity of a site to discuss our inspection observations and 23 plans for future inspections at that site. These meetings provided

75 1 opportunities for Staff and managers to hold face-to-face discussions with 2 members of the local communities. We also conducted a town hall meeting 3 in the vicinity of the licensee's spent fuel storage site. That meeting was 4 sponsored solely by the NRC so that the public would have an opportunity to 5 interface with us independent of licensee representatives.

6 In addition to our public webinar meetings we fully utilized 7 the Agency's public web page and the Spotlight feature to post inspection-8 related and technical documents of interest to the public as well as questions 9 and answers related to the site-specific enforcement action and our ongoing 10 technical review involving one licensee. We also used this web page feature 11 to provide easy access to the Agency's frequently asked questions for spent 12 fuel storage and transportation, as well as other technical documents.

13 During the past year several briefings were performed for 14 Congressional representatives and their staff to explain the bases for Agency 15 decisions and the status of spent fuel oversight activities. In addition, one 16 senior manager, along with other invitees, participated in a Congressional field 17 hearing conducted in California to discuss issues involving spent fuel 18 management activities in that state. A second senior manager also 19 participated in a hearing conducted by the California Coastal Commission.

20 Based on our experience over the past year the Staff plans 21 to be proactive in considering enhanced public and Congressional stakeholder 22 engagement when significant technical or safety issues are identified and 23 when there is significant stakeholder interest with a specific spent fuel storage

76 1 site.

2 The photograph in this slide shows members of the NRC 3 interacting with the public in the vicinity of operating power plants.

4 Next slide, please. As new spent fuel storage systems and 5 facilities are constructed and operated additional inspections may be required.

6 Regional and Headquarters staff will continue to closely monitor initial fuel 7 campaign schedules and anticipate that licensees may choose efforts to 8 expend fuel loading campaigns to support decommissioning activities.

9 The Regional and Headquarters teams will continue to 10 collaborate and share resources to ensure oversight of the most safety-11 significant activities. As the model for decommissioning shifts to the 12 increased use of contractors for turnkey operations the Staff will continue to 13 ensure that safety culture considerations remain at the forefront of operational 14 decisions.

15 The Staff recently completed a limited number of 16 inspections of aging management programs. Those inspections were 17 performed in accordance with Temporary Instruction 2690-11.

18 Implementation of that temporary instruction was announced to the 19 Commission in December of 2017. The purpose of the temporary instruction 20 was to evaluate through inspection whether spent fuel storage licensees have 21 adequate processes or procedures, either planned or in place, to implement 22 aging management programs to support renewed specific licensees or 23 renewed certificates of compliance for storage system designs.

77 1 Renewed specific license holders and certificate of 2 compliance holders are required to provide aging management programs with 3 license or certificate renewal applications in accordance with 10 CFR 72.42, 4 or 72.240, respectively.

5 The Staff selected sites for review under the temporary 6 instruction in accordance with specific criteria that included, among other 7 items, sites with different storage system designs and inclusion of a site from 8 each Region. Staff is currently completing their review of the initial data 9 collected from this effort. The Staff will use the results of the inspections to 10 develop future inspection guidance.

11 We expect to incorporate review of licensees' aging 12 management programs into our routine periodic inspections and we also plan 13 to monitor operating experience in this area as we proceed with those 14 inspections to determine whether adjustments to the inspection efforts or the 15 guidance is needed.

16 Regional and headquarters Staff have also evaluated 17 technologies which have been successfully used to both inspect and repair 18 metal surfaces. Those activities have included the observation of in situ 19 visual assessments of spent fuel canisters loaded in a UMAX spent fuel 20 system where the majority of the canister remains underground or below the 21 pad surface. In that particular instance the assessments were performed 22 using a video camera mounted on a small robot which navigated around the 23 surface of the canister.

78 1 The Staff has also recently observed demonstrations of 2 metal particle overlay, or a cold spray process that can be used to repair flaws 3 in metal surfaces. One licensee is currently exploring the use of this 4 technique with equipment that would be deployed robotically to assess the 5 effectiveness of in situ canister repair. These efforts are being explored by 6 industry to identify methods that can be used for canister inspection and repair 7 in the future, if needed, and to support future aging management programs.

8 The photographs on this slide show robotic devices that 9 have been tested and could be used in the future for inspection or repair of 10 canisters.

11 Next slide, please. NRC continues to share operating 12 experience gathered through our Vendor and Licensee Oversight Programs.

13 Information is posted to the NRC web page either through site-specific 14 portions of the Spotlight feature or through other more generic sections such 15 as the frequently asked questions. When appropriate the Staff issues 16 generic communications.

17 The Program Office has sponsored its annual regulatory 18 conference meetings, as mentioned earlier, where operating experience as 19 well as future program development are discussed. Regional inspectors 20 have also noted that spent fuel storage system vendors continue to 21 communicate operational experience and in some instances have issued 22 recommendations based on lessons learned to their customers in an effort to 23 enhance safety.

79 1 In one instance a vendor recommended the use of 2 equipment that would provide the ability to maintain visual observation of 3 loaded spent fuel canisters during lifting and downloading operations as well 4 as consideration of using load-sensing devices on equipment that is used to 5 lift and move spent fuel canisters during fuel transfer operations. The NRC 6 will continue to monitor operating experience and issue generic 7 communications as we see appropriate to the industry.

8 And finally, if interim consolidated storage facilities are 9 approved, additional oversight of licensee inspections before and after 10 transport may be needed. As licensing activities for these facilities 11 progresses and the inspection program evolves we will monitor resource 12 needs and will evaluate them further.

13 That concludes my remarks. I'll turn it back over to John.

14 MR. LUBINSKI: Linda, thank you.

15 I also want to thank Chris, John. I also want to thank all the 16 members in the Division of Fuel Management for helping prepare us for the 17 two presentations this morning, as well as the work they do every day, and 18 the program offices that we -- or program offices who we work with in the 19 Regions for supporting the program as well as these presentations.

20 With that, that concludes our prepared remarks for this 21 morning and we now look forward to any questions.

22 CHAIRMAN SVINICKI: Thank you for that 23 acknowledgement, John. It is important to note that often the presenters

80 1 have been supported by a lot of other NRC Staff. So thank you for 2 recognizing those individuals who may be in the room or just listening in today.

3 And with that, we'll begin questions with Commissioner 4 Baran.

5 COMMISSIONER BARAN: Well, thank you for your 6 presentations. I appreciate the discussion we had on the first panel about 7 potential changes that would have the effect of reducing inspections and 8 inspection hours for fuel facilities.

9 This ended up being I think the main focus of the first 10 session, and I think that's appropriate because it's an important issue. It's 11 good to hear that working groups aren't getting explicit direction to recommend 12 cuts to inspections, but we also heard from one working group member that 13 rightsizing was a key focus for the working group; and I think we all know what 14 rightsizing means, and that orientation shows in a basic framework of what 15 the working group recommended in that case.

16 And as we talked about in the first panel, there were three 17 tiers of safety issues: Tier 1, Tier 2, Tier 3. And under this construct Tier 1 18 gets flat level of inspection, or in some cases actually reductions. Tier 2 gets 19 cuts. Tier 3 gets deeper cuts. And if that's the basic framework, the 20 outcome seems pretty obvious. Cuts not just to inspection hours, but to 21 inspections by reducing their frequency.

22 I disagree with the idea that fewer inspections would somehow 23 enhance safety.

81 1 For this panel I'd like to discuss the potential changes to 2 independent spent fuel storage installation or ISFSI inspections. These of 3 course are the dry cask storage pads located around the country, typically on 4 site at operating or decommissioned reactors. There was an NRC Staff team 5 looking at this issue, too. All four Regions were represented on the team.

6 The stated goal of this effort is risk-informing the program. But to be clear, 7 the Staff is talking about major reductions in NRC safety inspections for 8 ISFSIs.

9 In October the Staff team presented two options to 10 management: One option was supported by three of the four Regions and 11 the other option was put forward by Region II. Under the majority 12 recommendation annual ISFSI inspection hours nationwide would be cut by 13 47 percent. Region II recommends going further, to cut inspection hours by 14 88 percent. Either way those would be dramatic reductions.

15 Is NRC management considering inspection reductions of 16 that magnitude?

17 MR. LUBINSKI: So at this point, as we said earlier about 18 our discussion, the report was provided to the Division Director. At the time 19 it was Mike Layton.

20 COMMISSIONER BARAN: Yes.

21 MR. LUBINSKI: Now we've done our reorganization it 22 would be Andrea Kock. Chris is the deputy of that division.

23 That was the initial working group's recommendations.

82 1 What we decided to do at that point was then go out for 2 public engagement. So we have made no decisions yet as a management 3 within NMSS on where we're going to go with that as far as any final decision.

4 We are going to continue to engage with the public. We did 5 handle this group a little differently where we worked a lot more internally 6 before engaging with members of the public. And that includes industry, all 7 the external stakeholders. So this is the start of that process now.

8 As Chris mentioned, we just had our first public meeting two 9 days ago and it was the first time people have had an opportunity to look at 10 those reports. We've asked for written comments to come in on that. Once 11 we get the evaluation of those written comments, we'll then make a decision 12 on whether we move forward with additional engagements with the public or 13 which decision we make. So in short, we've not made a final decision yet, 14 but we're considering the recommendations of the working group.

15 We have set up, as the previous working group set up the 16 same way with asking the group to bring together groups of inspectors. One 17 of the champions of this was a previous SRA out of the industry who -- or I'm 18 sorry, out of the Region who had a great risk background to bring to the table 19 in looking at risk insights. And we asked them to develop how do you look at 20 what risk factors to consider in going forward. So we as a team didn't even 21 define to them the true definition of risk. They came back to us on looking at 22 the different risk factors on how to consider.

23 And a little bit different than in the fuel facility area, but one

83 1 of the similarities is in the fuel facilities we looked at different disciplines such 2 as chemical safety, criticality safety. In this area they were looking at 3 operations. There's a lot of operations that occur when you talk about an 4 ISFSI. It's not just the storage on the pad. It's the storage on the pad 5 whether it's at the reactor or whether it's away from the reactor. What about 6 during fuel loading campaigns? So we looked at where do you focus your 7 efforts during those different facets of the ISFSI.

8 COMMISSIONER BARAN: I want to ask about that. San 9 Onofre had a near-drop of a dry cask not that long ago, but it looks like the 10 working group team is recommending a general reduction in inspection hours 11 for dry cask loading campaigns from 66 hours7.638889e-4 days <br />0.0183 hours <br />1.09127e-4 weeks <br />2.5113e-5 months <br /> per year to 35 hours4.050926e-4 days <br />0.00972 hours <br />5.787037e-5 weeks <br />1.33175e-5 months <br /> per year.

12 That would be a 47 percent cut in inspection hours. The Staff working group 13 also recommends a 33 percent reduction in routine stand-alone ISFSI 14 inspection hours.

15 Are those recommendations what we're putting out for kind 16 of public comment?

17 MR. LUBINSKI: Those recommendations are being put 18 out for public comment, yes.

19 COMMISSIONER BARAN: As I think about this kind of 20 from a big picture, there's a lot going on right now that has the Agency, the 21 industry and the public focused on the safety of dry cask storage. We have 22 nuclear power plants decommissioning. There is increased interest in 23 consolidated interim storage. There was the event at San Onofre. Casks

84 1 around the country are aging and obviously will continue to age.

2 The reality is that the Agency is not expending a lot of resources on 3 ISFSI inspections right now. It's just around three full-time equivalents each 4 year. This big potential cut, if it were at the recommended level of the working 5 group, would only say 1.4 FTE.

6 So I think a question we have to ask ourselves as part of 7 this decision making process is, is that small amount of savings really worth 8 reducing public confidence in the safety of dry cask storage in communities 9 around the country?

10 MR. LUBINSKI: So I would say there a couple things in 11 that: Number one is we need to look from the standpoint of our own 12 resources, as you said, as far as if there were a potential cut. And again, we 13 haven't made any decision yet. How are we focusing our resources and how 14 are -- how is that influencing where the licensees are focusing their resources?

15 So if a licensee is focusing their resources in an area that 16 may not be as risk-significant, may have a very low safety significance, may 17 require us -- them to continually do that based on the amount of inspections 18 we do, that's going to take their focus away from safety -- or more significant 19 safety issues at the plant. So that's the other impact when you look at 20 reductions in a program or shifts on a program based on the safety 21 significance from one area to the other.

22 So even if you're talking about small amounts of effort, you 23 have to look at what the positive impacts are of those changes from the

85 1 standpoint of having a refocus of plant operations into the correct areas.

2 COMMISSIONER BARAN: Well, I think that's a 3 reasonable factor to consider. I think though we also need to consider the 4 reactions of non-industry stakeholders. How many communities hosting 5 ISFSIs do you think would see a 50 percent reduction of NRC inspections as 6 a safety enhancement?

7 MR. LUBINSKI: So at this point, as I said, we've gone out 8 and asked for public comment. We have not received any public comments 9 yet. We did have the meeting this past Monday. Most of the comments 10 received during the discussion were from the industry.

11 I'm going to ask Chris. I think we had 60 people on the 12 phone line?

13 MR. REGAN: We had 47.

14 MR. LUBINSKI: Forty-seven? Forty-seven people on the 15 phone line. Not all of them identified themselves. But we did reach out 16 beforehand to make sure that members of the public were notified about the 17 meeting, and we believe some of them were on the phone. We heard nothing 18 from them on the phone. That doesn't mean they're not going to comment in 19 writing. So we look forward to getting those comments in before making our 20 decisions.

21 COMMISSIONER BARAN: Yes, I mean, we don't want to 22 guess about what people would think about this.

23 But, Linda, you were at a recent San Onofre public meeting

86 1 on NRC's response to the near-drop. How do you think the Staff's 2 recommendation would have gone over with the stakeholders who attended 3 that meeting?

4 MS. HOWELL: It is quite true that stakeholders in the 5 vicinity of San Onofre might not be happy with the decrease in inspection 6 effort, but I think if you step back and you take a look more broadly at the dry 7 fuel storage facilities across the nation the level of interest from local 8 stakeholders, members of the public, as well as Congressional stakeholders, 9 will vary depending on where that particular storage system is in its life cycle.

10 In other words, if you have a site that's undergoing extended 11 fuel off-load such as San Onofre to support more rapid initiation of true 12 decommissioning activities, the members of the public may have greater 13 interest at that time and they may question the NRC why would you decrease 14 your level of inspection effort?

15 If you -- on the other hand if you have a site such as Trojan 16 or Humboldt Bay where there is no continued active fuel loading, you hear and 17 see less interest or belief expressed by members of the local communities that 18 NRC needs to expend additional hours. And one of the things that was 19 factored into this working group's recent review is that particular issue. It's 20 like when and where should we be focusing our inspection efforts? And I 21 think John alluded to that in his response.

22 So there's flexibility built into the approach for inspection 23 procedures, even though you might ultimately end up with a slight decrease,

87 1 but it's -- the team attempted to focus their recommendations on where should 2 we be putting our oversight efforts and what are the really risk-significant 3 activities?

4 COMMISSIONER BARAN: Yes. Was there some area 5 that these resources were recommended to be shifted to, or just cut?

6 MR. LUBINSKI: There was actually a slight increase in 7 inspections during fuel loading, so there was an increase in that area.

8 COMMISSIONER BARAN: But the overall 47 percent 9 recommended reduction, that's not being shifted to something else. That's 10 just gone?

11 MR. LUBINSKI: No, it's not being shifted to something 12 else. Where it will go is we will continue to see increases in this area as far 13 as the number of inspections that we need to perform nationwide. So on a 14 plant basis, no, it's not being shifted within that plant, but it will be used for 15 inspections at other ISFSI facilities.

16 COMMISSIONER BARAN: Okay. Great. Thank you.

17 CHAIRMAN SVINICKI: Thank you.

18 Commissioner Wright?

19 COMMISSIONER WRIGHT: Thank you. Good morning.

20 Still. Yes.

21 So the last time we were briefed on these two business lines 22 we were at the beginning of our conversation on transformation, and the 23 presentations from both the panels this morning have really highlighted how

88 1 you've embraced transformation and a lot of the changes that you are going 2 through. And I think should be proud of the work you're doing and I look 3 forward to hearing more as you progress through the full implementation.

4 So, Chris, I'm going to start with you. All right? And then 5 your hour will be up.

6 (Laughter.)

7 COMMISSIONER WRIGHT: You mentioned the NEI 8 transportation tabletop that was at Prairie Island. And I attended that in May.

9 Found it very helpful to see how the different groups that would be involved in 10 transporting spent fuel would interact and where the hand-offs would be. I 11 was particularly impressed with the industry staff that were playing the role of 12 the NRC. I understand that your Staff spent some time coaching them and --

13 MR. REGAN: We did, yes.

14 COMMISSIONER WRIGHT: -- on our role and the 15 regulations. And that really seemed to pay off because they were quite 16 impressive. So thanks for that.

17 I'm also pleased to hear about the work that your Staff is 18 doing to be ready for the transportation of fresh and irradiated accident-19 tolerant fuel and high-assay LEU fuel. So it seems like we're making pretty 20 good progress for the designs that we're familiar with such as the ceramic fuel 21 pellets and zirconium cladding.

22 Are there any gaps that we still need to address for other 23 designs like triso or metallic fuel or -- and what about the high-assay LEU

89 1 fuels?

2 MR. REGAN: So from a regulatory perspective, no, but 3 there are some technical areas where additional data would be helpful to 4 obtain to better inform our reviews of those new types of fuel cladding and the 5 higher enrichment levels. If you focus on spent fuel storage, spent fuel 6 transportation, material characteristics that we might need to know for 7 transportation of spent fuel at the back end storage of that fuel -- because we 8 do have regulatory requirements that would need to be addressed that you 9 would need that data for.

10 So from a technical standpoint there are some areas that we 11 want to look at, but that's currently something that we're assessing. But from 12 a regulatory standpoint no regulatory gaps.

13 COMMISSIONER WRIGHT: So what do you see as the 14 biggest change that the NRC has yet to make to be ready for these 15 applications?

16 MR. REGAN: So our regulatory processes are in place, 17 and as mentioned we actually have already approved transportation of fresh 18 fuel for the lead test assemblies. So it can be done. We have the processes 19 in place. What we're primarily waiting on at this point are applications.

20 We've engaged with industry. We've communicated with 21 NEI what our -- what the expectations are if they are to meet their 2023 desire 22 for batch loading of the advanced ATF or HALEU. So really we're collecting 23 data, doing some research for the back end of the fuel cycle, but at the

90 1 moment we're in a holding pattern to actually get an application to start 2 reviewing those.

3 COMMISSIONER WRIGHT: Are there any areas where 4 Staff is waiting on us, the Commission?

5 MR. REGAN: No. None that I'm aware of, no.

6 COMMISSIONER WRIGHT: Okay. All right. Good.

7 Thank you.

8 John, good morning.

9 MR. McKIRGAN: Good morning.

10 COMMISSIONER WRIGHT: So it can be hard to articulate 11 what being a modern risk-informed regulator means, but the graded approach 12 pilot for the certificate of compliance reviews is a great example I think of how 13 we can use risk insights to appropriately focus the reviews.

14 So I understand that you're also working on a proposed rule 15 related to a 2014 petition for rulemaking that requested changes to the 16 regulations to address the format and content of certificates of compliance.

17 MR. McKIRGAN: Yes, sir.

18 COMMISSIONER WRIGHT: How do these two activities 19 relate?

20 MR. McKIRGAN: So there is a nexus there. The graded 21 approach came along somewhat after that petition was initially submitted, but 22 there is a connection there.

23 And so one of the things the Staff is doing now is to kind of

91 1 re-look at the landscape in light of where we are and reassess what we can 2 do just within our own purview, within guidance and within the current 3 regulatory framework. And so that is where the graded approach really 4 comes in. So we have regulatory framework that enables certain flexibility.

5 The pilot that we chose was an excellent one in that it had a 6 very long history, it had been modified a number of times and it had grown 7 over time. And so it was ripe for a fresh look at what is in the tech specs, 8 what is in the CoC that really needed to be retained for safety? And so it was 9 an ideal pilot.

10 The transformation and the risk informing of that process 11 was also well timed and ideal in that the transformation mentality -- we were 12 working with the Staff to come to that mind set and that pilot proved to be an 13 excellent example of -- a practical example of where the Staff is actually 14 working through the risk insights and sorting through item by item, 99 items, 15 to partition them into what needs to stay and what can go or what can be 16 modified. So there was a neat confluence of elements there that came 17 together in that pilot.

18 We are looking at more holistically some of the other items 19 that were considered in that petition and I think that is still in process. We 20 haven't come to any conclusions yet on that. But we did want to take a look 21 at what we can do within our own purview first before going through a rather 22 laborious rulemaking process.

23 COMMISSIONER WRIGHT: Right. So you had a people

92 1 meeting in October, I understand --

2 MR. McKIRGAN: Yes, sir.

3 COMMISSIONER WRIGHT: -- to gauge I guess the 4 interest in continuing with the rulemaking. What kind of feedback did you 5 get?

6 MR. McKIRGAN: So I think there's a -- I don't know that 7 we've gotten all the final feedback on that. I think there's still some more work 8 to be done there. There was some good responses from industry. They 9 have some views. I think there was good support for that notion of trying to 10 see what we can do absent rulemaking, but we do need to follow the 11 rulemaking process. That petition is in the process and we want to be true to 12 that process and allow that to come to its conclusion. And we'll be certain to 13 communicate those results.

14 COMMISSIONER WRIGHT: Okay. Thank you for that.

15 Coming to you, Linda. How are you this morning?

16 MS. HOWELL: I'm fine.

17 COMMISSIONER WRIGHT: So I really appreciate your 18 leadership this year. You've done some very complex issues with a lot of 19 public interest.

20 MS. HOWELL: Thank you.

21 COMMISSIONER WRIGHT: You appear to routinely kind 22 of approach things with a level head and you have the ability to communicate 23 very difficult technical, highly technical stuff in a way that people can

93 1 understand and connect with. So that's not an easy task, so congratulations 2 on that ability.

3 So I'm impressed with how many communication 4 techniques and channels were used to communicate with all the interested 5 stakeholders on the issues with SONGS and Holtec. And you used town hall 6 meetings, you used webinars, written communications, briefings for 7 Congressional staff, website postings and social media postings.

8 So what did you learn from using these varied approaches?

9 Are there lessons learned that we can apply to other high-interest activities?

10 MS. HOWELL: Perhaps. And thank you for asking that 11 question. It was a daunting approach to the Staff initially, but as we 12 completed the first webinar and prepared for the next one, it became easier 13 over time. So it's really not complex.

14 I think one of the biggest lessons was the reception by 15 members of the public. We'll talk about the webinars. The concept that we 16 were able to get information that was of interest to them out in advance of that 17 45 or 60-day period that it traditionally takes us to produce a team inspection 18 report was important because they understood just based on what they saw 19 and read in the media, what they were hearing from the licensee that decisions 20 were being made, that inspection activities were ongoing.

21 And so I think there was a great appreciation by members 22 of the public whether they specifically liked our decisions or whether they 23 specifically liked the information, but they did appreciate the ability to hear that

94 1 in a timely manner and to have those opportunities when we went out and 2 participated in the community engagement panels to step up and discuss their 3 thoughts, express their views with us face to face. I think that's a great 4 learning experience.

5 And I think that over the course of the last year we became 6 more proactive as we went along, if we knew that a report was coming out, a 7 decision was about to be made, with reaching back to the Office of 8 Congressional Affairs and making offers to do those Congressional staffing 9 briefings. Not only did we do them remotely, but whenever we went out to 10 the community engagement panel meetings, we made the offer to drop by the 11 local district offices so that they could sit with us one on one, ask questions 12 and we could ensure that they had a common understanding.

13 So I think the approach to looking proactively at who do we 14 need to engage with, when do we need to engage when we know that we 15 have high stakeholder interest is a lesson that we should walk away from from 16 this. And it doesn't just apply to spent fuel. It may apply to many other 17 situations.

18 COMMISSIONER WRIGHT: Were there any IT issues that 19 maybe we should explore that would -- that we need to work on to improve 20 our communications?

21 MS. HOWELL: Honestly it was very easy. The 22 technology that's out there and the infrastructure that we have in place at the 23 Agency made it relatively straightforward to go ahead and conduct this.

95 1 COMMISSIONER WRIGHT: Thank you so much.

2 CHAIRMAN SVINICKI: Well, thank you all again for your 3 presentations.

4 Linda, maybe I'll turn to you because it's easier sometimes 5 just to continue rather than to keep going back and forth.

6 I do want to thank you for the work that you're doing, and 7 particularly I was listening with interest to your response to my colleague about 8 looking at our techniques of reaching out to people. I think that the days of 9 considering it kind of a one-size-fits-all outreach program I think are over.

10 And in a polarized world it's easy to just kind of go, well, there's trying and 11 utter defeat and everything else, but I -- there are things that are more effective 12 and it depends on who you're communicating or trying to communicate with 13 and what you're trying to communicate. So I appreciate that we're bringing 14 some thought to that.

15 And you're in Region IV, so I know you've been busy 16 because we have some things that have garnered some public interest out 17 there. If I may ask without being too personal, how many years of public 18 service do you have?

19 MS. HOWELL: I achieved my 31st year with the NRC --

20 21 CHAIRMAN SVINICKI: Okay.

22 MS. HOWELL: -- this past fall.

23 CHAIRMAN SVINICKI: Well, wonderful for that. On any

96 1 given day I'm sure you've -- have you felt a lot as you've gone about -- that 2 your job on many days is doing the easy thing or doing the right thing?

3 MS. HOWELL: I personally tend to focus on doing the right 4 thing.

5 CHAIRMAN SVINICKI: Yes, okay. So often I think those 6 of us with long public service know what it is to be the face of unpopular 7 decisions. And it is not easy. It takes a certain evolved thinking not to take 8 people's concerns and general criticism of your organization personally. So 9 it is kind of a higher order evolved area to work in.

10 But I think we talked a little bit about rightsizing. When 11 you're working in communication you find out that words mean different things 12 to different people. I'd be interested; and maybe I'll pivot to John on this one.

13 He's gotten so bored, he's writing a doodle there.

14 (Laughter.)

15 CHAIRMAN SVINICKI: Do you think that the concept of 16 rightsizing a regulatory footprint bears a relationship to reasonable assurance 17 of adequate protection, which is again the legal standard for what we do, which 18 is not the absolute delight of every stakeholder and constituent all the time.

19 It's reasonable assurance of adequate protection. Do you think rightsizing is 20 an inherent element of that?

21 MR. LUBINSKI: Yes, I do. That's the premise of making 22 the decisions. That's the task when we talk about risk-informing activities to 23 still making sure we have reasonable assurance of adequate protection.

97 1 When we deal with external stakeholders, that's some of the challenge we 2 have. Even when we use the words reasonable assurance of adequate 3 protection, we'll hear back from them that's not enough. We want absolute 4 assurance. And that's -- we have to tell them that's not our mandate.

5 CHAIRMAN SVINICKI: I had to sit once in a meeting with 6 an elected official who didn't like our 95 percent confidence levels. He 7 wanted it to be 100 percent. And it's interesting in those moments how you 8 realize that it's everyone's background that gives them a different perspective.

9 And as an engineer I really had to think on my feet. And so my answer was 10 zero and 100 percent really don't exist in the physical world. Like zero was 11 invented --

12 MR. LUBINSKI: Yes.

13 CHAIRMAN SVINICKI: -- I'm forgetting now by who.

14 Somebody invented zero, but before that the concept of zero hadn't existed.

15 And so I said really nothing is ever perfectly safe or absolutely risky. It's we're 16 always kind of working at varying levels and 95 percent confidence is 17 considered actually a very, very high confidence.

18 But it revealed to me the different things -- people hear 19 things differently, they think differently. And I'm sure that you could find 20 constituencies that would find both of those perspectives reasonable. So we 21 often have to be the face of explaining these things, and it's not easy. But I'm 22 sorry I cut you off on that.

23 MR. LUBINSKI: Oh, no, I appreciate that, because again

98 1 as we go forward and getting the input from the public many times we go 2 through a -- what I'll say is a mini risk analysis as we're asking the questions 3 and getting input. And as we answer the questions we find many times we 4 get the what next, what if after that.

5 And we find ourselves having to then explain that we're 6 looking at the probability of that incident occurring when you start to get five, 7 six, seven what ifs down the line and saying we have to make, as Linda said, 8 the tough decision, the tough call to say, no, we've now determined this is 9 reasonable assurance, no, it's not absolute assurance, we're not at zero risk, 10 and have to be able to communicate that. But where do you draw that line?

11 Where do you make that call? And that's the difficult decision we need to do.

12 And then we need to make sure as we're communicating it 13 -- because they're coming up with what has a consequence to it in their what 14 if scenario. It's truly a consequence, but the probability of that consequence 15 is so low that we need to make that decision.

16 CHAIRMAN SVINICKI: Well, and we see this too often; I 17 find myself thinking about this concept, when it comes to new technologies 18 that in industry, or the industry we regulate here at NRC, which is mostly what 19 we think about; but I try to think about other regulated industries -- there are 20 new enhancing technologies that the regulator is not in a position to mandate.

21 We heard a little bit about visual inspections and things that 22 can be done that are not -- certainly something at this point in time we have 23 no regulatory basis to compel everyone to send those little robotic crawlers in

99 1 there. Now, if there's some issue and we have a safety concern, then we 2 would ask the licensee to propose some means of addressing it.

3 But if the regulatory framework for any industry would never 4 basically take into account some new technologies or in some ways -- I hate 5 this term provide credit for, but I kind of think of it as in a regulatory space can 6 you have some acknowledgement of an enhanced technology that you can't 7 mandate if it's diagnostic or an inspection technology or something like that.

8 What is the likelihood of the industry you regulate really 9 exploring and funding the development of those things which again do have 10 positive enhancing safety attributes, but you can't require them -- you could 11 get kind of locked and frozen in a circumstance where they have no motivation 12 to improve that. It does further enhance safety beyond the regulations. And 13 so that's another element I think of rightsizing is having a system that gives 14 you the flexibility if there's deteriorating regulatory performance of putting 15 more regulatory oversight and a heavy regulatory footprint on something.

16 But if regulatory performance is stabilized or they want to 17 invest in -- for their own maybe business reasons have some of these 18 technologies that further would enhance safety or give us greater knowledge, 19 perhaps even further enhanced confidence about something, then you have 20 to be able to somehow encompass those improvements.

21 And so I think as we look at transformation, I think, sure our 22 fiercest critics can look at it as some sort of diminishment of who we are and 23 our commitment to safety and security, but I think for me that's first of all kind

100 1 of an injustice to the good people and the work they're doing here. I've been 2 here a while. I've gotten to know a lot of you. And while NRC can move at 3 a frustratingly ponderous pace sometimes, there is a lot of caution built into 4 that.

5 And so at the end of the day being the face of some of the 6 Agency's decisions, it is wonderful to be able to engage an external 7 constituency and say this is how we analyzed it. Here's the care and rigor 8 that we used on something. So while it can seem to move at its own pace, 9 you do come out at the end of the day with a well-substantiated set of 10 recommendations and things like that. So I've talked a bit.

11 John, when I communicated to you that the Commission 12 was going to ask you to step into this role as NMSS director and the 13 Commission asked you to do that, we were reflecting on your early career time 14 in NMSS. And you've had some time now to be Director and during this 15 transformation phase to look at where you're taking NMSS now. How would 16 you contrast the two, of the NMSS you're leading today as the director and 17 then your early experiences with NMSS. And I'm sure many in NMSS are 18 tuning in.

19 (Laughter.)

20 CHAIRMAN SVINICKI: This is the Director's evaluation.

21 MR. LUBINSKI: I find it interesting. When I look at my 22 early career in NMSS, I really look at it as a two-part career. One was more 23 in what's the nuclear materials users now and the other was in the fleet fuel

101 1 cycle area. So I'll address both of those.

2 As I was responding earlier with your question about the 3 oversight program, and using that as just one of the examples, just looking at 4 that area the amount of new information we have right now on risk insights in 5 that area I think is huge. And I think the Staff and their embracing of it is just 6 much different than it was 20 years ago because they now have that 7 information.

8 So when I think about the changes that are taking the 9 program, it's not that John Lubinski's coming into the job and asking make this 10 change. It's me coming into the program and saying what changes do we 11 need to make? The answer is in the room. What do you believe we need to 12 do? And they're saying, oh, we do have ideas. We've had these ideas.

13 Let's bring them into to -- so I've seen that as a difference and a contrast I'd 14 say in that area and having those more risk insights.

15 When I think back, it was longer ago when I was in the 16 Nuclear Materials Users Group. And it's interesting because so many of 17 those issues have evolved more, whether it's in the general licensing area, 18 licensing in medical, and we've made a lot of changes in those areas over the 19 years. So in some of those areas I'd say certain aspects I don't even 20 recognize anymore. Others are still the same. But I've appreciated that the 21 Staff in those groups have taken it to the next level and moved it forward to 22 the place it is today.

23 And again some of the issues are still the same that we're

102 1 dealing with, and I do get a smile on my face at times when people refer back 2 to a paper that may have had my name on it from 25 years ago and use my 3 words back to me. But, and I'd say in those cases some of my views have 4 evolved, which is also interesting because we may look at where my position 5 was 25 years ago and I feel that I've learned, I've grown, and my position has 6 changed on many of those issues as well.

7 And I think that's a good example that we can use as we're 8 talking to others about our change and our transformation that when we can 9 show ourselves the way we've changed and the way our thinking changed, it 10 helps others to think about that as well.

11 CHAIRMAN SVINICKI: I appreciate your candor on that, 12 and I -- gosh, I would hope even in the time I've been at NRC that I hope I've 13 changed and evolved in things. And I think a lot of us consider that a really 14 healthy dimension. So I take that as a very positive answer on your part, that 15 you'd be willing to acknowledge if you were a technical contributor to 16 something 25 years ago that you've learned a lot, that the world has changed 17 and we need to keep our aperture open in that way.

18 I again as chairman get invited to speak a lot of places and 19 I got a really good question. I can't remember the venue, but the question for 20 me was so NRC is successful in this transformation journey and you come 21 back and walk in the door five years from now, how does it look different?

22 And my answer, I don't remember it specifically, but it was 23 somewhere along the lines of I don't think it's about like changing who we are

103 1 and what we do. I don't think that's really the change. I think to me it would 2 be more reflective of kind of what's happening in the wider world, our own 3 practices and regulations and procedures and maybe the kind of how we do 4 what we do has hopefully improved, it's more informed, we're leaning in and 5 taking -- and having access to the tools and things and just the learnings and 6 communication and other things that are available to us.

7 But, again, it's been -- as I predicted at the beginning --

8 there, see, you laid the table with a lot of really wonderful content there. I 9 want to thank you all and again to your Staffs who prepared you for the 10 presentations here today.

11 And with that, we are adjourned. Thank you.

12 (Whereupon, the above-entitled matter went off the record 13 at 11:28 a.m.)