ML20081A470

Nuclear Regulatory Commission Issuances for November 1994. Pages 169-318

ML20081A470
Person / Time
Issue date:	02/28/1995
From:	NRC OFFICE OF ADMINISTRATION (ADM)
To:
References
NUREG-0750, NUREG-0750-V40-N05, NUREG-750, NUREG-750-V40-N5, NUDOCS 9503150152
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" O:.., y(.; ' ' v f t r ? s >;'h. 5 Available from l Superintendent of Documents U.S. Government Printing Office P.O. Box 37082 Washington, DC 20402-9328 l A year's subscription consists of 12 softbound issues, 4 indexes, and 2-4 hardbound editions for this publication. i Single copies of this publication are avail-ble from National Technical laformation Service Springfield..VA 22161 ' t ? l i t b l . i i 1 i t 1 Errors in this publication may be reported to the i Division of Freedom of information and Publications Services l Office of Administration U.S. Nuclear Regulatory Commission +~ Washington, DC 20555-0001 (301/415-6844) i i ? i 9 s.--

.m I 7 i i l NUREG-0750 l Vol. 40, No. 5 Pages 169-318 i i hUCLEAR REGULATORY COMMISSION ISSUANCES l i i November 1994 i f i i This report includes the issuances received during the specified period I from the Commission (CLI), the Atomic Safety and Licensing Boards j (LBP), the Administrative Law Judges (ALJ), the Directors' Decisions t' (DD), and the Denials of Petitions for Ru'emaking (DPRM). l The summaries and headnotes preceding the opinions reported herein are not to be deemed a part of those opinions or have any independent legal significance. I i ) U.S. NUCLEAR R'EGULATORY COMMISSION i Prepared by the Divisbn of Freedom of Information and Publications Services Office of Administration U.S. Nuclear Regulatory Commission Washington, DC 20555-0001 (301/415-6844)

w; COMMISSIONERS 1 Ivan Selin, Chairman Kenneth C. Rogers E. Gail de Plangue i i D. Paul Cotter, Jr., Chief Administrativo Judge, Atomic Safety and Uconsing Board Panel 3 t

4 'i ] f 'f "t d . CONTENTS

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. i i t. Issuances of the 'Atossic Safety and Licensing Bosnis t! l CAMEO DIAGNOSTIC CENTRE, INC.' _...

l Docket No. 30-29567-CivP (ASLBP No,94-686-01-CivP)

-l (Byproduct Material License No. 20-27908-01) (EA 93-005) 1994................. 169: L DECISION, LBP-94-34 November I, l i GEORGIA' POWER COMPANY, et al. l ' (Vogtle Electric Generating Plant, Units I and 2) i

Docket Nos. 50 424-OLA-3,50-425-OLA-3 (ASLBP No. 93-671-01-OLA-3)

I License Amendment; Transfer to Southern Nuclear) .' (Re: .. 288 i ~ MEMORANDUM AND ORDER, LBP-94-37, November 8,1994 INDIANA REGIONAL CANCER CENTER 'f 030-30485-EA (ASLBP No. 94-685-02-EA) ' j Docket No. (Order Modifying and Suspending Byproduct Material License [ No. 37-28179-01) ( MEMORANDUM AND ORDER, LBP-94-36, November 4,1994.. 283 ,j t LOUISIANA ENERGY SERVICES, L.P. .l f (Claiborne Enrichment Center) Docket No. 70-3070-ML (ASLBP No. 91-641-02-ML) d I (Special Nuclear Material License) 18, 1994.. 309 MEMORANDUM AND ORDER, LBP-94-38, November l PACIFIC GAS AND ELECTRIC COMPANY ~ (Diablo Canyon Nuclear Power Plant, Units I and 2) i 92-669-03-OLA-2) i Docket Nos. 50-275-OLA-2,50-323-OLA-2 (ASLBP No. ~ (Construction Period Recovery)(Facility Operating License Nos. DPR-80, DPR-82) 180 INITIAL DECISION, LBP-94-35, November 4,1994... SEQUOYAH FUELS CORPORATION Docket No. 40-8027-MLA-3 (ASLBP No 94-700-04-MLA-3) j (Source Materials License No. Sub-1010) 314-MEMORANDUM AND ORDER, LBP-94-39, November 22,1994. i l 5 lii i f i i

s d Atomic Safety and Licensing Boards issuances ATOMIC SAFETY AND UCENSING BOARD PANEL B. Paul Cotter, Jr.,* Chief Administrative Judge James P. Gleasot\\

• Deputy Chief Adminis** Jve Judge (Erecutive)

Frederick J. Shon,* Deputy Chhl Administrative Judge (Technical) l Members Dr. George C. Anderson Dr. David L. Hetrick Marsha8 E. Maar Charles Bechhoefor* Emest E. Hin Thomas S. Moore

• Peter B. Bioch*

Dr. Frank F. Hooper Dr. Peter A. Morrie G. Poul Bonwork 111* EHzabeth B. Johnson Thorran D. Murphy

• Dr. A. Dixon Canhan Dr. Charles N. Kolber*

Dr. Richard R. Portrek Dr. James H. Carpenter Dr. Jerry R. Kline* Dr. Harry Rein Dr. Rchard F. Cole

• Dr. Peter S. Lam
• Laster S. Rubenstein Dr. Thomas E. Elleman Dr. James C. Lamb til

. Dr. Dav6d R. Schink Dr. George A. Fergm Dr. Emmoth A.1.uebke Ivan W. Smith

• Dr. Harry Foreman Dr. Kenneth A. McColiom Dr. George F. Tidey Dr. Rohard F. Footer 6

d

• Permanent panelmembers

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e y. m-. n' f ;'+-'; , [ 'lI i 0( i Cite as.40 NRC 169 (1994) LBP-94-34 UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION ATOMIC SAFETY AND LICENSING BOARD Before Administrative Judges: j tn t Ivan W. Smith, Chairman I Dr. Richard F. Cole Dr. Charles N. Kolber - i l in the Matter of - Docket No. 30-29567-CivP (ASLBP No. 94-686-01-CivP) ~ l (Byproduct Material License. .l No. 20-27906-01) .W . (EA 93-005) CAMEO DIAGNOSTIC CENTRE,INC. November 1,1994 i . 4 DECISION (Granting NRC Staff Motion for Summary Disposition) j t. I. INTRODUCTION ' The NRC Staff, pursuant to the Commission's rule on summary disposition, .I ~ 10 C.F.R. 6 2.749(a), moves for disposition of all of the issues in this proceeding and a finding that the Staff's November 24,1993 " Order Imposing a Civil Mon-etary Penalty" (Order) issued to Cameo Diagnostic Centre Inc. (the I ic..isee) ' should be sustained. In the Order below the Board grants the motion, thereby terminating the proceeding. In a separate Memorandum and Order, also issued i today, we dispose of pending procedural motions. h I 169 l a i i l m

IL BACKGROUND On April 16, 1993, the Staff issued a " Notice of Violation and Proposed . Imposition of Civil Penalty"(Notice of Violation) to the Licensee that set fonh two violations of NRC requirements which were characterized as willful, and proposed a civil penalty. Licensee responded by letters dated June 11, 1993, and July 23, 1993. Together the responses denied the allegations, especially the severity level of ' violation. On November 24,1993, the Staff, taking into account the Licensce's response to the Notice of Violation, issued its Order imposing a civil monetary penalty in the amount of $1750 to the Licensee. On December 17,1993, the Licensee requested a hearing on the Order, and, on December 30,1993, this Board was established to preside over it. During a prehearing conference of February 1,1994, the Board requested the Staff to advise it on legal aspects of alleged Violation I.B. As a consequence, the Order and Notice of Violation were subsequently modified on February 15,1994, to reflect more accurately the nature of Violation I.B.8 Both originally and as modified the orders and notices charged that the Licensee changed the location of its operations without license auth" to do so, and provided inaccurate information with respect to the change. a full text of the alleged violations, as modified, is stated below at pp.172 and 173. Because the issues to be heard would not be materially altered by the forthcoming modification, on Rbruary 14, 1994 tne Board issued an order that established the issues fer discovery and a hearing schedule. Licensee answered the modified order and notice on March 14,1994, again denying the alleged violations. On March 22, 1994, tbe Staff served discovery demands. However, the proceeding was interruptc pending settlement negotiations before a settlement 1 judge appointed for that purpose. On June 7,1994, the settlement judge reported to the Board that the parties had failed to reach a settlement. The Board ordered the proceeding to resume on June 22, 1994. On July 7 and 22,1994, the Licensee filed discovery demands. Many discovery disputes followed. On August 9 and 10,1994, the Board resolved the remaining discovery motions and prehearing matters. The Board ordered that the,aring schedule be resumed and provided that "[a]ny motion for summary disposition must be filed on or before September 12,1994, and must be ^ careful compliance with the provisions of 10 C.F.R. 5 2.749." The Board als ruled that the Licensee's answer to the motion was to be due no later than 20 days thereafter.2 I-order Madafymg order imposmg Cml Manciary Penalry? 59 I ed Reg R667 (f eb 23,1994) i 2 See Memorandum and order (fullowmg Prehearmg Conferencek dated AuFust II.1994 funpublishedt 170

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.. De NRC Staff filed the instant motion on September 12,' 1994. De Licensee ? 'has not' answered the motion. i W IIL LEGAL STANDARDS FOR

SUMMARY

DISPOSITION - De Commission's regulations at 10 C.F.R. 5 2.749 provide that any party - may move for a decision by the presiding officer in that party's favor as to all ~' or any part of the matters involved in the' proceeding. -10 C.F.R. 62.749(a). l Summary disposition is appropriate if the. fdings in the proceeding, including x! depositions, statements of the panies, and affidavits, show that there is no

l genuine issue as to any material fact and that the moving party is entitled to a :

decision as a matter of law.' 10 C.F.R. 5 2.749(d). ~ 'i ne party seeking summary judgment has the burden of proving the absence - of genuine issues of material fact. Admnced MedicalSystems. Inc. (One Factory Row, Geneva, Ohio 44041), CLI-93-22, 38 NRC 98,102 (1993). ') A party opposing a motion for summary disposition, however, must answer .j the motion, controverting it by showing that a genuine issue of material fact exists. If the opposing pany fails to do so - or fails to show why it cannot - I the material facts stated by the moving party (as to which no genuine dispute f exists) will be deemed to be admitted. 10 C.F.R. 5 2.749(a). lf no answer is j filed, as is the case here, the decision sought by the moving party, if appropriate, i shall be rendered.- 10 C.F.R.12.749(b). l 1 IV. ISSUES OF MATERIAL FACT l-! t . A.' Introduction - ne Staff's motion is extensively and :ompletely supported by affidavits of .f its cognizant officers, correspondence, the deposition of Cameo's president, and i other exhibits. De underlying facts' are deemed admitted. We accept them as set out in the motion, often without further examination or attribution.- Cameo is in default. We review the motion only as a part of our responsibility { to see that the decision sought by the Staff is appropriate. Throughout this _j proceeding, Mr. Paul L Rosenbaum, President of Cameo Diagnostics, has focused his defense on the issue of whether, given the facts alleged in the notice and order (but without admitting them), the Staff has improperly escalated the j monetary penalty. We discuss the escalation issue in a r,eparate section below, l but an understanding of the factual bases for the penalty is necessary first. e t i 171 i I t I .i l l l

Y 'T r H B. Violation I.A t i Violation LA alleges: is 10 Cf.R. 3113(c) requires that a hcensee apply for and rnust receive a license arrendnent before it adds to or changes the areas of use or address or addresses of use identified in the apphcation or on the hccese Contrary to the above, as of Novernber 3,1992, tie licensee changed the address and location at which byproduct nuterial was used frorn 110 Maple Street. Springfield. Massachusetts to 155 Maple Street. Springfield. Massachusetts, and the hcensee did not receive an arnendrnent to authorize the change of location until January 12,1993. Cameo Diagnostic Centre, Inc., is the holder of an NRC byproduct material license. The license originally authorized the Licensee to use NRC-licensed materials at 110 Maple Street, Suite A. Springfield, Massachusetts. On December 18, 1991, the Commission issued License Amendment No. 3 which authorized the Licensee to use NRC-licensed material at 3400 Main Street, Springfield. Massachusetts, in addition to 110 Maple Street. License Amendment No. 3 did not authorize any other locations of use. It was not until January 12,1993, that the Commission issued the founh license amendment to the Licensee which, for the first time, authorized the Licensee to use materials at 155 Maple Street. 'Iherefore, during November and December 1992. Licensee was authorized to use SRC-licensed material only at 110 Maple Street an.J 3400 Main Street. Use of the material at any other location during this time constituted a violation of 10 C.F.R. i 35.13(e). On November 2,1992, the Licensee changed the address and location at which byproduct material was used from i10 Maple Street to 155 Maple Street. As noted, the Licensee did not receive an amendment to authorize the change until January 12, 1993. Mr. Rosenbaum admitted that he began to use technetium-99m byproduct material at 155 Mapic Street "[p}crhaps two or three days past November 2nd." On December 17, 1992, the Staff issued a Demand for Information to the Licensee, which requested a complete list of dates on which NRC-licensed material was used at 155 Maple Street in violation of the Commission's requirements. On December 18, 1992, the Licensee responded by ictter with an attachment representing "[a] complete list with dates, type and amount of radioactivity ." The list of dates runs from November 3,1992. through December 11,1992, and includes every weekday during that period with the exception of November 24,26, and 27,1992. There is no genuine issue of material fact in dispute with respect to the facts as they relate to Violation I.A. 'Ihe Licensee was in violation of the Commission's regulations as set forth in Violation I.A of the Notice of Viootio.. 172 P

p i - C. Violation LB Violation I.B,'as modified, alleges: 10 CF.R. 30.9(al requires, in part, that information provided to the Commission by a hcensec l be complete and accurate in all material respects. Contrary to tie above, the Licensee did not provide to the Commiss;on informatir* tat was. complete and accurate in all material respects. Specifically, dunng a Novenar 12. 1992 f,1 telephone conversation in response to a questic fam Region I as to whether the LJcensee had licensed materials at its new address (155 haapte Street. Springricid, MA), the Licensee F> responded negatively. Tle licensee nesponse was confirned in a letter fmm NRC to the hcensee dated November 13,1992 which stated that it was the NRC understanding that: . 2, You [Licensce] do not as yet possess any licensed radioactive material at this new l fr.cdity." Therefore, the Licensee provided inaccurate information to the Commission in that it had possessed beensed matenals at its new address. This information was matenal. because, had the correct information been known. it would have resulted iri action by the NRC to prohibit licensed activity at the new address untd a hcense amendment had been granted. The circumstances surrounding the violation are set forth below. The October 21,1992 Meeting Mr. Rosenbaum met with NRC officers, Ms. Susan Shankm.m and Ms. Pamela IIender,on at the NRC Region I offices on Oeti ber 21, 1992. Ms. lienderson, a }{eahh Physicist in Region I, was assigned to review the Licensee's pending license renewal application. The purpose of the meeting was to discuss outstanding issues. Mr. Rosenbaum stated that he intended to move his facility to 155 Maple Street. Ms. lienderscn informed Mr. Rosenbaum that the license renewal would take time to complete because he had requested exemptions from several regulations, which required review at NRC headquarters. Mr. Rosenbaum was told that if the Licensee chose to include its request to u ' licensed material at the new address in the renewal application, the Licensee t at use material at the new location until the renewal process was completed and the license renewal was issued. Ms. IIenderson also explained to him that the Licensee could facilitate a change of address by submitting a separate amendn.mit request, and that the amendment could be issued more quickly than the license renewal. Mr. Rosenbaum stated that he understood this, but would nonetheless like to include the request to add the new location in the license renewal in order to avoid paying a separate amendment fee.

1here is no genuine issue with respect to the tacts pertaining to the October 21,1992 meeting.

173

?- p. The November 12,1992 Telephone Conversation Mr. Rosenbaum left a message for Ms. Henderson on November 10,1992. He explained that he had moved, that his office was in disarray, and that he would get back to Ms. Henderson with information that she had requested. Ms. Henderson received Mr. Rosenbaum's message on November 12, 1992, and, together with Ms. Shankman, contacted Mr. Rosenbaum by telephone to confirm that he had moved and to verify that he had not begun using NRC-i licensed materials at the new location. During the November 12, 1992 conversation, Ms. Henderson asked Mr. Rosenbaum whether he had NRC-licensed material at his new address at 155 Maple Street. Mr. Rosenbat.m replied in the negative. The November 12,1992 conversation is documented in a letter from Ms. Henderson to Mr. Rosenbaum, dated November 13, 1992. The purpose of the letter was to summarize the contents of the November 12,1992 conversation. The letter states: From the telephone conversation,it is our understanding that: 1. You have taken occupancy of a new facihty. 2. You do not as yet possess any NRC licensed radioactive materials at this new facahty. Mr. Rosenbaum later admitted that, during the Novembe* 12,1992 conversa-tion, either Ms. Henderson or Ms. Shankman told him that ie could not use the material at the address. The November 13,1992 letter from Ms. Henderson to Mr. Rosenbaum also confirms that on November 12,1992, Mr. Rosenbaum was " informed that in order to commence use of NRC licensed radioactive materials at [his] new facility that (he] must apply for and receive a license amendment or license renewal which identified the address where radioactive materials are used or possessed." He was also advised of the merits of applying for license renewal compared with a license amendment. There is no genuine issue of material fact in dispute with respect to the conversation that took place on November 12, 1992, or with respect to the content of the November 13,1992 letter. The November 19 and November 25 Telephone Conversations On November 19, 1992. Ms. Henderson reminded Mr. Rosenbaum that he could not use NRC. licensed material at the new facility until the Licensee had a license that included the new k) cation of use. On November 25. 1992, Ms. Henderson left a message at Cameo's office that Mr. Rosenbaum be reminded that the Licensee could not use NRC-licensed 174 i I l l L ]

I*_ materials at its new facility until'it received a license that included the new location of use. There is no genuine issue of material fact with respect to the reminders to the - Licensee on November 19 and 25,1992, that it could not use licensed material at the new address until receiving a license amendment. The Events of December 11,1992 On December 11,1992, Dr. Keith Brown, a Health Physicist, NRC Region 1, contacted a radiopharmaceutical licensee in the Springfield, Massachusetts area and verified that it was shipping material to Licensee at 155 Maple Street and that it had been regularly shipping doses of radiopharmaceuticals containing technetium-99m to Cameo. Later the same day, Ms. Shankman, during a telephone call, asked Mr. Rosenbaum whether the Licensee was using NRC-licensed material at a location other than the one authorized on its License. Mr. Rosenbaum replied in the affirmative. Ms. Shankman informed Mr. Rosenbaum of the need to amend the License prior to using licensed material at the new location and cited the Commission's regulations at 10 C.F.R. 6 35.13. Ms. Shankman asked if Mr. Rosenbaum would agree to seo using NRC-licensed materials at the unauthorized address, and Mr. Rosenbat m replied in the negative. Dere is no dispute tha Mr. Rosenbaten possessed e id used NRC-licensed material at the 155 Maple Street location during the tii.c alleged in the notice of violation and that Licensee provided inaccurate and incomplete information about those facts to the NRC on November 12,1992.) Consequently, the Board finds that Violation I.B, as set forth in the Notice of Violation, as modified on February 15, 1994, did occur as stated therein. V. AMOUNT OF MONETARY PENALTY A. Introduction The amount of the civil penalty was determined by assigning a severity level to the violations. calculating the base penalty, and applying any adjustment factors. De Licensee initially objected to the characterization of Violations 1.A and I.B as willful and objected to the categorization of Violations 1.A and 1.B at Severity Level 111, because the change in location did not have radiological I lhe events of Novendier 19 and 21 and Ikccmber 11. 1992. do not en themwives support Violation t B. Nevenheless. they are sigmhcans facts m deternunmg the amount of the cml penalty See sceuons V D and V D. mfra 175

V I _ significance and because the Licensee informed the Staff on October 21,1992, that the Licensee would be changing locations, and notified the Staff on November 10,1992, that the move had taken place. He Licensee also stated that the $1750 civil penalty, being a 250% increase over the $500 base penalty, is entirely unjustified and completely based on personal animus. The issue of r personal animus was later withdrawn from the proceeding by Licensee as noted in our Memorandum and Order of August 11,19941 Ms. Patricia A. Santiago, Assistant Director for Materials of the Office of i Enforcement, explained how the Staff assigned the severity level to the two violations and assessed the amount of civil penalty for the violations. She explains that the Staff's determination of the amount of the civil penalty was made in accordance with the Commission's " General Statement of Policy and Procedure for NRC Enforcement Actions," 10 C.F.R. Part 2, Appendix C. Ms. Santiago held her position on November 24, 1993, when the Staff issued the Order to the Licensee. Ms. Santiago's explanation is very detailed and com*>lete. He Board can - find no fault with it, and Licensee has not controverted her reasoning. B. Severity Level ne Notice of Violation states that the two violations represent a Severity Level III prabicm, as illustrated by Supplements VI ard VII of the " General Statement on Policy and Procedure for NRC Enforcemi nt Actions." 10 C.F.R. Part 2, Appendix C. De Staff aggregated the two violations in assessing a severity level and determining the amount of the civil penalty. The aggreFation was in accordance with section IV.A of the Enforcement Policy, which permits the Staff to evaluate s a group of violations and to assign a single severity level if the violations stemmed from the same underlying cause or deficiency. De purpose of an aggregation is to focus a licensee's attention on the problem. Both violations stemmed from the unauthorized use of NRC. licensed material at 155 Maple Street, and they were both willful. He Staff assigned a severity level based on the most suitable examples provided in the Supplements to ib Enforcement Policy. Licensee's activity area corresponded with Supplemem VI, " Fuel Cycle and Materials Operation." he Staff compared the Licensee's violations to two examples in Supplement VI. The first example, an example of a Severity Level III violation, was: t 0. A failure to receive required NRC appro al prior to the implementation of a change in hcensed activities that has radiological or programmaus sign ficance. such as . a change in the location where licensed acuvuies are being conducted. L 176 P P L j

y D L De second example, "[o]ther violations that have more than minor safety or environmental significance" (D.2) was an example of a Severity Level IV violation. In a lucky development for Licensee, the Staff determined that the Licensee's violations best corresponded with the Severity Level IV example based on the safety significance of the Licensee's program. The Staff then increased the severity level to Severity Level III, in accordance with section IV.C of the Enforcement Policy, to reflect the regulatory significance of the willful nature of the violations.. In evaluating willfulness, the Staff considered the responsibilities of the person involved in the_ violations; the significance of the underlyinF violations; the intent of the violator; and the economic or other advantage, if any, gained as a result of the violations. The Staff considered that Mr. Rosenbaum had been told many times that an amendment to the License was needed prior to using licensed material at any new location and he nevertheless continued to use material at the new location, and, thereby demonstrated, at a minimum, careless disregard for the Commission's requirements. He did it to save money associated with a fee for an amendment to the License. De Staff was well within its discretion to increase the severity level from Level IV to Level 111. C. Calculation of the Base Civil Penalty Once the reverity level was assigned to the violations, the Staff derived the civil penalty amount using Tables I A and 1B of the Enforcement Policy, section VI.B. Table 1 A shows the base civil penalty at Severity Level I for different classes of licensees. Item (j), Other material licensees," provides the lowest base civil penalty. The base civil penalty for a violation under item (j) is $1000 for violations concerning " plant operations, construction, health physics, and emergency preparedness." This is the lowest penalty possible under the table. Table IB of the Enforcement Policy shows how to calculate the base civil penalty at verious severity levels. The base civil penalty for Severity Level 111 violations.is 50% of the amount listed in Table I A. The Staff determined the base civil penalty to be $500. D. Adjustment Factors he base civil penalties shown in Tables I A and IB may be increased or decreased based on the civil penalty adjustment factors set forth in section VI.B.2 of the Enforcement Policy. The Enforcement Policy lists six adjustment factors: identification, corrective action, licensee performance, prior opportunity to 177 e e f

m, r F . identify. multiple occurrences, and duration. De Staff applied three of the - factm in determining the amount of the civil penalty. ',L Staff first applied the " identification" factor, to the base civil penalty-and escalated the penalty by 50% because the NRC, not Licensee, identified the violation. The Staff did not escalate or mitigate the base civil penalty for the two violations with respect to the second adjustment factor, " Corrective action," or i for the third adjustment factor, " Licensee performance " Under factor (d), " Prior opportunirv to identify," the base civil penalty may be increased by up to 100% in cases where the licensee should have identified the violation sooner as a result of prior opportunities such as "(2) through prior notice, i.e., specific NRC or industry notification; or (3) through other reasonable indication of a potential problem or violation" and others. He Staff escalated the base civil penalty by 100% based on the notices given to the Licensee. De Staff also escalated the base civil penalty by 100% by applying the sixth adjustment factor," Duration," which permits the Staff to escalate the base civil penalty as much as 100T for violations that continue or remain uncorrected for more than one day This factor is normally applied in cases where a significant regulatory message is warranted. The Staff determined that 100% escalation of the civil penalty based on this factor is appropriate because the violations continued for approximately I month and that a significant regulatory message was warranted. We believe that this adjustment wn a sound decision. In summary, the Staff escalated the base civi, penalty by 250% to $1750 based on three adjustment factors: identification (50%); prior opportunity to identify (100%); and duration (100%). Here exists no genuine issue with respect to whether, on the basis of the violations and the Enforcement Policy, the Order imposing a civil monetary penalty in the amount of $1750 sould be sustained. VI. CONCLUSION AND ORDER The Licensee was in violation of the Commission's regulations as set forth in Violation I.A and I.B of the Notice of Violation as modified. On the basis of the violations, and in accordance with the Enforcement Policy, th: Order imposing a civil monetary penalty in the amount of $1750 is SUSTAIAco.4 9 4 ' Judge Cole was niu avakble to sign ttus Deessmn. tiut approwed the result 178

mm p. VII. RIGHT TO APPEAL This Decision is effective immediately and, in accordance with 10 C.F.R. 62.760, shall become the final action of the Commission forty (40) days from the date ofissuance, unless any party petitions for Commission review in accordance with 10 C.F.R.12.786 or the Commission takes review sua sponte. Within fifteen (15) days after service of this Decision, the Licensee may file a petition for review by the Commission on the grounds specified in 10 C.F.R. 6 2.786(b)(4). - He filing of a petition for review is mandatory for a party to exhaust its administrative remedies before seeking judicial review A petition for review must be no longer than ten (10) pages and must contain the information specified by 10 C.F.R. 6 2.786(b)(2). The NRC Staff may, within ten (10) days after service of a petition for review, file an answer supporting or opposing Commission review. The answer must be no longer than ten (10) pages and should concisely address the matters in 10 C.F.R.12.786(b)(2) to the extent appropriate. l THE ATOMIC SAFETY AND LICENSING BOARD Charles K. Kelber ADMINISTRATIVE JUDGE Ivan W. Smith, Chairman ADMINISTRATIVE JUDGE Rockville, Maryland November 1,1994 179

M. ff. ,.n P- ? 6 :y, p ,-[9 LSP-94-35 ; Cite as 40 NRC 180 (1994), C . ~ UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION ' ATOMIC SAFETY AND LICENSING BOARD ' a 1 Before Administrative Judges: ra t Charles Bechhooter, Chairman .{ Dr. Jerry R. Kline Frederick J. Shon Docket Nos. 50 275-OLA 2 - in the Matter of -- 50-323 OLA-2 (ASLBP No. 92-669 03-OLA-2) l (Construction Period Recovery) (Facility Operating License No s. DPR40, DPR-82) t -t PACIFIC GAS AND ELECTRIC . COMPANY (Diablo Canyon Nuclear Power November 4,1994 " l Plant, Units 1 and 2) ~ 1 The Licensing Board issues an Initial Decision that approves operating li-cense amendments extending the Unit i operating license for approximately 13 i years a d the Unit 2 license for almost 15 years, representing recapture of peri-n f [ ods of construction of the reactors. in approving the amendments, the Licensing Board issued three directives to th: Applicant with respect to the maintenance

and surveillance program. Th, Board also rejected cl aims that PG &b s imple-mentation of Thermo-Lag compensatory measures war inadequate. Finally, the Board ruled against the Intervenor's second Motion to' Reopen the Record. r-the ground that reopening could not change the result the Board was otk reaching.

f i ) 180-1 l 1 i

+ 1 1 f-dy s s J

f OPERATING LICENSE AMENDMENTi SIGNIFICANCE l

^ ' An operating license amendment that does not modify any systems, struc-l tures,'or components (SSCs) but which extends the license term to recapture time lost during consttuction represents a significant amendment and not merely . a ministerial administrative change, notwithstanding prior review during the op- ' crating license proceeding of such SSCs. MAINTENANCE AND SURVEILLAnLE PROGRAM: STANDARDS Absent any' currently' effective regulatory standards for maintenance and sutveillance programs, those programs must be judged in terms of the "rea-sonable assurance" of public health and safety appearing in the Atomic Energy Act. 'The guidance provided by INPO 90-008, Rev. 01 (March 1990) is also useful in looking at the elements of a comprehensive program. MAINTENANCE AND SURVEILLANCE PROGRAM: STANDARDS Perfection in implementation of a maintenance and surveillance program is not required,' given the " reasonable assurance" standards of the Atomic Energy Act. A MAINTENANCE AND SURVEILLANCE PROGRAM: SCOPE A maintenance program must be deemed to include maintenance-type activi-ties and supporting functions performed by employees outside the Maintenance Department. MAINTENANCE AND SURVEILLANCE PROGRAM: STANDARDS " Fundamental flaw" and " failure of an essential element" are not appropriate f criteria by which tojudge the effect of maintenance deficiencies or the adequacy l of a maintenance and surveillance program. Those criteria were developed by t the Commission to deal with a particul.tr problem under defined circumstances and are not applicable where, as here, circumstances differ markuity. With respect to implementation of a maintenance and surveillance program, numerous or repetitive incidents may coalesce to indicate a significant deficiency in a program. I l l 181 i i i

m =- 3 i F 3 RULES OF PRACTICE: CROSS EXAMINATION 4 An intervenor may present its case through cross-examination of other parties' witnesses and by use of documents offered through those witnesses.' e RULES OF PRACTICE: PROPOSED FINDINGS Even though a party presents no expert testimony, it may advance proposed findings that include technical analyses opinions, and conclusions, as long as the fxts on which they are based are matters of record. The Licensing Board must do more than act as an umpire blandly calling balls and strikes for ad.versaries appearing before it. The Board includes experts who can evaluate the factual material in the record and reach their own judgment as to its significance. RULES OF PRACTICE: CROSS-EXAMINATION PLANS The Rules of Practice require parties generally to submit cross-examination plans to the Licensing Board (although not to other parties) but they do not require parties to provide other parties with advance notice of exhibits they plan to use in cross-examination. .r-RULES OF PRACTICE: REOPENING OF PROCEFDINGS Motions to reopen a record are governed by 10 C.F.R. 6 2.734, which requires that a motion to reopen a closed record be timely, that it address a significant safety or environmental issue, and that it demonstrate that a materially different result would be or would have been likely had the newly proffered evidence been considered initially. TECHNICAL ISSUES DISCUSSED 'Ihe following technical issues are discussed: Maintenance / surveillance; Thermo-Lag Interim Compensatory Measures. APPEARANCES David A. Repka, Esq., Kathryn M. Kalowsky, Esq., Washington D.C., and l Christopher J. Warner, Esq., and Richard F. Locke, Esq., San Francisco, California, for Pacific Gas and Electric Co. (Applicant). 182 f A i b

mg f l 1 /1 3 L. ft Diane Curran, Esq., Washington D.C., and Ms.' Jill ZamEk, Pismo Beach, ' California, for San Luis Obispo Mothers for Peace (Intervenor).- 4 r<I, = Aan P. Hodsdom, Esq., Arlene A. Jorgensen, Esq, and C itherine L. Marco, { Esq., for the Nuclear Regulatory Commission Staff. i i ' ABLE OF CONTENTS l T p ( 1. INTRODUCTION.................................. 185

11. - B ACKGROUND................................. 185 III. STANDARD OF REVIEW.....................

188 I A. General Requirements............................... - 188 B. Method of Proof................. 191. l C. Assened Procedural Deficiencies..... 192' IV. CONTENTION I (Maintenance / Surveillance Program) 195 [ A. Scope of Contention ' . 196 B, Description of Maintenance / Surveillance Program 198 { C. Evaluation of Evidence . 207 Maintenance of Environmental Qua', i ation of Electrical Equipment. .. 204 2. Check Valves /IST Deficiency..... 209 3. Cable Failures . 210 4. Wrong Size Motor Installed............. 211 5. Storage and Handling of Lubricants 213 6. Fuel Handlir>p Building........... 214 7. Tests of Contaiinment Personnel Airlock 215- [ 8. Component Cooling Water (CCW) Heat Exchanger. 217 9. Auxiliary Building Ventilation System Inoperable . 218

10. Restoration of Electrical Panels 219

11. Containment Equipment Hatch...

. 221 l

12. Manual Reactor Trip Caused by Failure of a Fuse for.

I the Rod Control System 222

13. Limitorque 2-FCV-37 Failed to Close 222

14. Safety injection Emergency Core Cooling System (ECCS) Accumulator Tanks.

. 223

15. Corrosion of ASW Annubar. DFO and CO Piping. 225 2

16. Control of Measuring and Test Equipment (M&TE). 227 i

183 L i ) i i a

w 7 r, il 'i y v. p E

17. Centrifugal Charging Pump 2-1; Degraded h

Coupling '............................... 228. 1

18. Unit Shutdown Dud to Inoperable High-Pressure

. Turbine Stop Valve :.......................... 230

19. Diesel Generator 2 2 Failure to Achieve Rated Voltage..

............. 231

20. Missed Alert Fregrency STP for Auxiliary Saltwater Pump 12 and Component Cooling Water Valve CCWJ2 kCV-16....................

232 , 21. In-Sorvice Prompt Test Data Questionable...... 234.

22. Hol1-Down Motor Bolts on Centrifugal Cha.ging Pumps 235

23. Rear tor Coolant System Leakage

....... 236

24. Reactor Cavity Sump Wide-Range Level Channel 942A Inoperable

........... 238

25. Design Criterion Memorandum (DCM) f Requirements.......................... 240 p~

26. Pipe Support Snubber Damage 241

27. Gas Decay Tank Missed Surveillance

. 243

28. Seismic Clips Not Installed 244 1

29.. Containment Fan Cooling Unit (CFCU)

Backdraft Dampers ... 245 3J. Control of Foreign Material /Cleanli ess/ Housekeeping.... 248

31. Steam Generator Feedwater Nozzle Cracking 253

32. Procedural Controls During Shot Peening Operations 255

33. Unplanned Activation of Engineered Safety Features (ESF)

. 236

34. Limitorque Valve Failure 257 35.' Motor Pinion Keys in Limitorque Motor Operators. 258

36. Control of Lifting and Rigging Devices.....

259

37. Main Feedwater Pump Overspeed Trip Due to Failure of Power Supp!v to Speed Sensing Probes 261

38. Inadvertent Co.. inment Ventilation isolation.... 263 i

39. Reactor Trip on Steam Generator Low Level....... 264

40. Auxiliary Saltwater Pump Crosstic Valve........ 265

41. Testcock Valve on Diesel Generator 267

42. Main Feedwater Check Valve

. 267

43. ASW Pump Vault Drain Check Valves 269

44. Motor. Operated Valve Failed to Cycle on Actuation Signal

. 270 i 184 j 1 I I J l i l

p> ;n-y, -e di ~,g a i 4 y r. .F d>+ L< o- . 45; Fire in Electrical Panel........................ 270 '46. Chemical and Volume Control System A; . Diaphragm Leakage............................ - 271. ' 47. - Conclusion on Maintenance and Surveillance. - t r,, Program.................................. f 271 - ^ ~

V.

RENEWED MOTION TO REOPEN THE RECORD........ 273 i VI. CONTENTION V (Thermo-Lag Interim Compensatory l Measures)............,.... i...................... 277 VII. CONCLUSIONS OF LAW '............................. 281 ' VIIL O RDE R......................................... 2 8 2 .i INITIAL' DECISION (Construction Period Recovery / Recapture) g-e I. INTRODUCTION This is an initial decision on Pacific Gas and Electric Company's (PG&E or i Applicant) application to amend the operating licenses for its Diablo Canyon Nuclear Power Plant, Units I and 2 (DCPP or Diablo Canyon), located near San Luis'Obispo. California. to allow for 40 years of operation dated from the issuance of its operating licenses. For the reasons set forth herein, we conclude - 1 that, to the extent challenged in this proceeding. PG&E satisfactorily justified the : license extensions it seeks and, subject to certain directions, as well as normal NRC Staff review. should be granted those extensions. II. IIACKGROUND 'On July 9.1992. PG&E submitted a license amendment request by which it ^ sought to extend the life ofits operating licenses for the DCPP by more than 13 years (for Unit 1) and almost 15 years (for Unit 2) by " recapturing" the period. spent in constructing the plants. The licenses which are limited to n :rm of 40 years by section 103c of the Atomic Energy Act,42 U.S.C, 9 2133(c), were i issued consistent with a then-extant Commission policy under which that 40- ' j year life extended from the date of issuance of the construction permit for a. j particular unit - for Unit I, a term running from April 23.1968. to April 23,- { 2008. and for Unit 2, a term running from December 9.1970, to December 9 ~ 2010. 1 185 1 C ..i

i In 1982, the Commission began issuing the' 40-year operating licenses r" measured from the date ofissuance of the operating license. It has also approved i license amendments for many reactors conforming the earlier licenses to this new policy. Ac Applicant is here seeking to amend its operating licenses to take advantage of the newer practice. As proposed, the extended expiration dates for DCPP would be September 22,2021, for Unit I and April 26,2025, for Unit 2. In response to a notice of opportunity for hearing on the proposed amend- !~ ments,57 Fed. Reg. 32,575 (July 22,1992), San Luis Obispo Mothers for Peace (MFP) timely filed a request for a hearing / petition for leave to intervene. This Licensing Board was established to rule on the request / petition and to preside over the proceeding in the event that a hearing were to be ordered. 57 Fed. Reg. 43,035 (Sept.17,1992). After a prehearing conference held in San Luis Obispo, California, on December 10,1992, at which we heard argument concerning MFP's petition and the Supplement in which MFP set forth its proposed cententions, together with PGAE's and the NRC Staff's responses each opposing admission of any of the contentions, we granted MFP's petition for leave to intervene and request for a hearing LBP-93-1. 37 NRC 5 (1993) (LBP-93-1); see also LBP-92-27,36 NRC 196(1992). We determined that MFP had standing and, of the eleven contentions proffered, we admitted portions of two of them: Contention I, challenging the adequacy of PG&E's maintenance and surveillance program, and Contention V, challenging the adequacy of PG&E's interim fce protection measures to compensate for defective "%ermo-Lag" passive tire barriers manufactured by Thermal Science, Inc. nereafter, MFP submitted three late-filed contentions. Following a prehear-ing conference held on May Il-12,1993, in NRC's then. Region V office at Walnut Creek, California, we rejected all three contentions. But we determined. that portions of iso of them could be litigated under the previously admitted maintenance and surveillance program contention, and that portions of another dealing with fire protection had become moot as a result of steps already taken or planned by PG&E. LDP-93-9,37 NRC 433 (1993). We held evidentiary hearings in San Luis Obispo, California on seven days, August 17-2., 23-24, 1993. He record was closed on August 24,1993 (Tr. 2295). PG&E and the Staff presented their cases through expm witnesses and documents. MFP put on no witnesses but presented its caw inrough cross-examination, based in larFe part on numerous PG&E and NRC documents that 186 i

'1 p f MFP offered into evidence. 'Ihereafter all parties submitted timely proposed - findings of fact and conclusions of law,' and PG&E submitted a timely reply.2 On February 25,1994, MFP filed a motion t:: reopen the recod based on ' material appearing in an NRC inspection report provided to PG&E by the NRC Staff on January 12,1994.3 PG&E and the NRC Staff filed responses on March 7 and 14,1994, respectively. By Memorandum and Order dated March 23, 1994, LBP-94-9, 39 NRC 122, we denied that motion, primarily because the matters in the i.nspection report relied on by MFP were at that stage no more than " unresolved items" and because an affidavit of the NRC inspector involved in the inspection (one of the Staff's witnesses in this proceeding) stated that - nothing in the inspection report was contrary to or inconsistent with his prior testimony. Our denial, however, was without prejudice to a later motion to reopen based on any of the unresolved items demonstrated to be significant and to possess substantive implications for implementation of the maintenance and surveillance program. On August 8,1994, MFP filed such a motion.' PG&E and the Staff each opposed the reopening.8 We are denying the motion for reasons spelled out in Part V of this Decision. "Ihe Board addresses the contested issues below. We have divided the re-mainder of this opinion into six parts. First, we describe the applicable legal standards for resolving the issues before us (Part 111). Next, we address the contested issues in two parts, the first (Part IV) adjressing Contention 1 (Main-tenance and Surveillance Program) and the second (Part VI) addressing Con-tention V (Thermo-Lag Interim Compensatory Measures). 'Ihese portions of the opinion include various findings of fact necessary to our conclusions on the respective issues. In Part V, we spell out our reasons for denying the Renewed Motion, which relates to the maintenance / surveillance issue immediately pre-E ceding it. In Part VII, we set forth conclusions of law, and, in Part Vill, our resulting Order.- I PG&E's Proposed Findings of Fact and Conclusions of Law m the Form of an Imual Decision, dated october B.1993 (PG&E FoFx MFP's Proposed Fin &ngs of Fact and Conclusions of Law Regardmg PG&E's Apphcation for a tjcense Amendment to Entend the Term of the operasmg License for the DCNPP. dated November 19, 1993 (MFP Fon NRC Staffs Fin &ngs of Fact and Concluuans of Law m the Form of an inmal Decision. dated December 22.1993 (Staff FoF) 2 PGAE's Reply Fan &ngs of Fact and Concluuons of Law dated December 30.1993 (PG&E Reply FoF). 3 This report was emered mio the NRC's NUDoCS &>cunwnt storage and retrieval system on February 2.1994. and bence became a pubhcly available document no later than that date. I d san t.uas obupo Mothers for Peace's Renewed Monon to Renpen the Record Regar&ng Pacdic Gas and Electne Company's Apphcanon for a tjcense Amendment to Entend the Term of the operaung tjcense for t5e Diablo Canyon Nuclear Power Plant, dated August 8.1994 (Renewed Monon). S PGil"s opposnion to San Luis obispo Mothers for Peace Renewed Monon to Reopen the Record. dated August 23.1994, NRC staff Response to san Luis obnpo Mothers for Peace's Renewed Mouen to Reopen the Record. dated August 29.1994 I i 187 .l I I

w L III. STANDARD OF REVIEW A, General Requirements - Since its change in policy in 1982, when it began measuring the term of. operating licenses from the commencement of operation, the Commission has approved more than sixty recapture amendment requests. PG&E FOF at 3; Tr. 2274 (Peterson). PG&E characterizes NRC's approval of recapture amendments as " routine" and " administrative in nature" inasmuch as it does not involve any alterations in plant design or operation, or any new environmental impacts not previously evaluated. PG&E FOF at 3.* In fact, that description may be more . reflective of the number of challenges to such approvals than to the nature of the approval itself; only one such comparable amendment request has been challenged. He only contention accepted in that proceeding concerned the adequacy of the surveillance and maintenance program, and it was finally settled (with some additional obligations attached to the extension). See Vermont Yankee Nuclear Power Corp. (Vermont Yankee Nuclear Power Station), LBP-90-6,31 NRC 85 (1990). In LBP-93-1, however, we in effect rejected PG&E's " administrative change" designation. In the context of determining MFP's standing to participate, we noted that the " risk of an accident with offsite consequences for an additional 13 to 15 years" represented injury in fact (notwithstanding the prior analyses 1 of such accidents) and in substance undercut PG&E's cla m that ti.e proposed amendments were not "significant" but virtually ministena. 37 NRC at 10-11. Our evaluation of the record evidence in this proceeding reinforces our view of the significance of the amendments, in seeking denial of the license amendments here in issue because of asserted deficiencies in the maintenance / surveillance program (Contention 1), MFP points out that there are currently no detailed regulatory requirements prescribing conditions for such programs. Similarly, it notes that there are no regulations for evaluating the adequacy of implementation of a maintenance / surveillance program in terms of past performance. MFP FOF 13. De Staff essentially agrees, pointing out that the NRC's maintenance rule,10 C.F.R. 6 50.65, does not become effective until 1996. Staff FOF 1-6. Normally, in evaluating the adequacy of a program such as the mainte-nance / surveillance program, a Board would look to standards appea:Lg in reg-ulations. Absent such regulations, MFP would rely generally on section 182a of the Atomic Energy Act (AEA) of 1954, as amended,42 U.S.C. 5 2232(a), which provides that an app?icant for a reactor operating license must submit sufficient information for the NRC to find that the facility will " provide adequate protec- 'The staff makes no anempt to charactenze the sigmhcance of the recapture pmceedang. 188 i i i j

e,- E'; . tion to the health and safety of the public." Further, MFP references section 103d of the Act 42 U.S.C.12133(d), providing that the NRC may not issue a license that would be " inimical to the... heahh and safety of the public." nese statutory standards are reflected in 10 C.F.R. 8 ' 57(a)(3) and (6), which L - specify in pertinent part that NRC may issue operating licenses upon finding that there is " reasonable assurance (i) that the activities authorized by the op-_ erating license can be conducted without endangering the health and safety of the public, and (ii) that such activities will be conducted in compliance with i _ NRC) regulations" and that issuance of die license "will not be inimical to [ the.. heahh and safety of the public." MFP adds that, although absolute perfection is not required, " reasonable assurance" may not be tainted by cost or risk-benefit considerations, citing Union of Concerned Scientists v. NRC, 824 F.2d 108 (D.C. Cir.1987). MFP FOF 112. Ibr its part, PG&E relies generally upon the " reasonable assurance" standard. PG&E FOF at 10. Both it and the Staff further cite various codes, standards, regulatc,ry guides, and technical specifications dealing with the maintenance of particular equipment. These standards do not, however, define an adequate maintenance / surveil- ~ lance program, ahhough the degree to which they are achieved may constitute a reasonable measure of program adequacy. As the Commission observed (in adopting the section 50.65 requirements to be effective in the future): r (tJhe Comnussvn's current regulations. regulatory guidance. and hcensing practice do nut clearly defme the Commission s expectations with regard to ensuring the continued effectweness of maintenance programs at nuclear power plants. 56 Fed. Reg. 31,306,31,308 Uuly 10,1991). Thus, we will refer to such stan-dards as guidelines to determine whether the maintenance / surveillance program is performing its intended function. MFP further references the guidance provided by INPO 90-008, Rev, 01, Maintenance Programs in the Nuclear Power Industry (March 1990)(MFP Exh. 4), as helpful in defining the scope of issues that a maintenance program must address in order to provide adequate protection to the public health and safety. MFP FOF 114. PG&E agrees, claiming that the evidence supports PG&E's compliance with those guidelines. PG&E Reply FOF 1R9. The Staff points out that, in declining to adopt regulations defining a maintenanw program, the Commission specifically declined to adopt INPO 90-008.^ Staff FOF 1-8, referencing 54 Fed. Reg. 50,611 (Dec. 8,1989). The Staff acknowledges, however, the usefulness of the INPO 90-008 standards in looking at the elements of a comprehensive maintenance program. He general safety provisions of the Atomic Energy Act and implementing general regulations are the ultimate standards against which to evaluate the 189

g . amendments.= The standards of INPO 90-008 and the other material cited by . various parties are useful as guidance. In determining the adequacy of PG&E's - program, we will refer to all these standards to determine what appears to us to constitute an' adequate program sufficient to provide reasonable assurance of public hea!th and safety for the extended operation period of the proposed. amendments. With respect to the maintenance and surveillance program, the Applicant has - maintained that the Commission's specific criteria for dealing with emergency. preparedness exercise issnes are gern. ne and that we might give weight only to maintenance deficiencies that indicate a " fundamental flaw" or " failure of an essential element" of the maintenance / surveillance program. PG&E FOF at 7. We earlier disagtred in essence with that conclusion and we still do. As we have held, numerous or repetitive incidents may coalesce to indicate a significant deficiency in the program. LBP-95-1,37 NRC at 19-21. " Fundamental flaw" was promulgated to deal with a specific circumstance involving an emergency planning exercise that would occur only at the time a plant was ready for operation. Litigation of the results of such an exercise could delay operation, and the concept of " fundamental flaw" was developed to keep delay to a minimum by limiting the scope of litigation. Long Island - Lighting Co. (Shoreham Nuclear Power Station, Unit 1), CLI-86-11, 23 NRC 577 (1986). IIere, the additional time needed for thorough consideration will not delay operation - technically, the extension is not r:eded until at least 2008. For all of these reasons, we have declined to follow the criteria favored by ) PG&E. Our decision will consider each of the alleged deficiencies propounded l by MFP and give it the weight that we consider it deserves. l With respect to the issue of interim compensatory measures for Thermo-Lag - (Contention V), MFP retics on a series of Information Notices issued by the Staff. It also cites several NRC Bulletins. MFP FOF 11786-787. We see no reason not to rely on this material, interpreted in accord with the " reasonable assurance" stcndard that also governs this issue. MFP contends (and we agree) that the burden of proof falls on the Applicant. MFP further asserts that PG&E has not satisfied that burden. MFP claims the 1 asserted deficiencies in the maintenance / surveillance program that it has demon-strated (as well as asserted deficiencies in PG&E's implementation of interim Thermo-Lag corrective actions) require denial of the proposed amendments. Id. 112, 839. PG&E and the NRC Staff assert, to the contrary, that the maintenance / surveil-lance prog am is adequate - indeed, exemplary - and that the statutory and regulatory standards referenced by MFP are perforce satisfied. PG&E and the ) Staff claim, and MFP concedes (id. 12), that perfection in a program is not required. given the " reasonable assurance" standards of the Atomic Energy Act. l 190

-Although acknowledging that the ultimate burden _of proof falls on PG&E, the s' Staff (and to a lesser extent, PGkE) further claim that MFP has the burden of d going forward with evidence, which (in their view) it has failed to do. Both PG&E and the Staff also find PG&E's implementation of Hermo-Lag interim - corrective measures ta be adequate. B. Method of Proof PG&E and the Staff each presented witnesses on both the maintenance /sur-veillance and the Thermo-Lag issues. MFP did not sponsor any witnesses but, instead, developed its case (as is permissible ) tkogh cross-examination of 7 PG&E and Staff witnesses and documents offered through them. He NRC Staff takes the position that the portions of MFP's proposed findings that include technical analyses, opinions, and conclusions may not be " adopted" by us, inasmuch as " technical analysr.t. opinions, and conclusions in NRC proceedings must be sponsored by experts who can testify to the soundness of the conclusions set forth." Staff FDF

2. He Staff relies primarily on Duke Power Co. (William B. McGuire Nuclear Station. Units 1 and 2), ALAB-669,15 -

NRC 453,477 (1982), and Southern California Edison Co. (San Onofre Nuclear Generating Station, Units 2 and 3), ALAB-717,17 NRC 346,367 (1983).- However, neither of these cases supports the Staff's position. In McGuire, the Appeal Board ruled that a Licensing Board had no* crred in declining to admit documents into evidence when 'here was no corr < tent expert witness to sponsor them. 15 NRC at 477. Similarly, in San Onofre, the Appeal Board would not allow portions of an applicant's Final Safety Analysis Report to be considered as substantive evidence when the applicant provided no witnesses for cross-examination on the document. In so ruling, the Appeal Board concluded that there was "no basis for allowing applicants to avoid cross-examination on a document of central importance that they themselves prepared." 17 NRC at 366. Both of these cases dealt with document reliability and the need for documents to be verified by competent witnesses before they can be admitted into evidence. In contrast, in this case the documents relied on by MFP were accepted into evidence after being introduced through PG&E's or the Staff's expert witnesses. Once admitted into evidence, MFP was entitled to use them in its proposed findings.' 7 Tennessee Falle3Authoren-(Hartsville Nucler > sant, Umts ! A. 2A. IB. and 2BL ALAB-463. 7 NRC 341. 356 0978); Commonweat 4 Edusa Co. (Zmn stanon. Unns I and 2). AIAB-226. 8 AEC 381. 389 (1974L IVursmsm E!cark Power Co. (Ponu Beach Nuclear Plant. Omt 2L ALAB-637. 6 Al;C 491. 5%o$ 0973t " Tie Staff also cues leansana Peer and Light Ca (waiaford Steam Dectne Staten. Unii 3). ALAB-732.17 NRC 1076.1088 n 13 0983). mvolvmg prepared durci tesumony of an capert. which 6s daunginshable on the same basis 191

7 he result of adopting the Staff's argument would be that, in reaching technical conclusions, the Board would be limited to relying on expen testimony y of witnesses - all sponsored by PG&E or the Staff and essential!y reaching the same conclusion. His would eliminate or seriously abrogate the right of MFP to present its case through cross-examination. We do not read the Commission's rules or decisions as either requiring or even permitting this result. Federal agencies, and this Board as the delegatee of such an agency, are required to do more than act as an " umpire blandly calling balls and strikes for adversaries appearing before it." Scenic Hudson Preservation Conference v. FederalPower Commission, 354 F.2d 608,620 (2d Cir.1965)? His Board includes technical expens who can evaluate the factual material in the record and reach their own judgment as to its significance. Early during the hearing, PG&E objected generally to MFP's introduction of documents intended to show deficiencies in PG&E's maintenance /surveitlance program, on the ground that the "uncontroverted evidence in the direct testi-mony" affirmed the adequacy of such program. Tr. 597. We overruled that general objection on the basis that we should have the opponunity to evaluate the significance of the documents and the adequacy of the program. Tr. 597-99. We permitted PG&E to offer objections to specific documents on grounds such as relevat.cc to the operation of the maintenance / surveillance program. Tr. 600. C. Asserted Procedural Defielencies ne NRC Staff raises a question concerning the advance notice it received of exhibits that MFP intended to introduce. The Staff points to the requirement that written testimony be provided the parties fifteen (15) days prior to the commencement of the hearing (10 C.F.R. 6 2.743(b)) and would extend that requirement to apply as well to the identification of exhibits. It faults MFP for not adhering to these standards and concludes that documents that other parties have not had an adequate opportunity to examine, and cross-examination based thereon, may not serve as a basis for our findings. Staff FOF 5-6. We rccognize the difficulties faced by the Staffin attempting to formulate its position in the absence of adequate notice from other panies of their position on issues. The 15-day testimony rute reflects, in part, the Staff's needs in this regard. Nonetheless, we decline t ndopt the Staff's suggested approach to the record. No such extension of the testimony-filing rule to documents appears in the ru!cs, either expressly or by implication. Indeed, where credibility of witnesses is at stake (as it was in certain instances in this proceeding, at least one of which was the subject of the Staff's complaint) it would undercut the 'See ut,o Trias l'uhncs Grwurms Co (Comanctw Peak sicam Electne Stanon. Uniti 1 and 21. LBP-82-87. 16 NRC 1195. Il99 0982) t 192 i

utility of the cross-examination were the documents to be revealed in advain to the opposing party. (' hat is the rationale for revealing cross-examination plans only to the Board prior to cross-examination.10 C.F.R. 5 2.743(b)(2).) In addition, we recognize, of course, that MFP's actions in this regard were driven not by any intent to ignore procedural requirements or make it difficult for the parties (or Board) to become adequately familiar with MFP's case. MFP was merely forced because of inadequate financial resources to present its case as best it could. A review of the procedural developments in this case will place in context the Staff's complaints. It appears that, until shonly.before the start of the evidentiary hearing, MFP had planned to present one or more witnesses. Our early scheduling orders, and MFP's early discovery responses, all anticipated that MFP would provide witnesses and file direct testimony. See, e.g., Memorandum and Order (Discovery and Hearing Schedules), dated February 9,1993 (unpublished), at 5; [MFPJ Responses to First Set of Interrogatories and Request for Production of Documents Filed by [PG&E] and Motion for Protective Order, dated March 22,1993; Prehearing Conference Order (Late-Filed Contenticos and Discovery), LDP-93 9,37 NRC 433,453 n.42 (1993). Indeed, during the course of discovery, MFP made use of several technical t consultants, whom it ident.fied. See, e.g., letter from Jill ZamEk, MFP, to Licensing Board, dated April 2,1993. As late as May 6,1993, it advised that it was " working with limited resources" and "would expect to be able to identify its expert witnesses" in the near future. [MFP] Reply to iPG&E's] Motion to Impose Duty on MFP to Supplen;ent Responses to Interrogatories and Requests for Production of Documents. ' Not until June 21, 1993, when we established the final filing date for testimony as August 2,1993 (see Memorandum and Order (Notice of Prehearing Conference and Evidentiary Hearing), dated July 8,1993,58 Fed. Reg. 58,974 (July 14,1993)) did MFP advise that it had "no commitment from any person to appear as an expert witness at the hearing " [MIP] Supplemental Response to First and Second Sets of Interrogatories and Requests for Production of Documents filed by [PG&E). It then agreed to provide a list of documents on which it would rely and, as a part of that filing, provided a listing that identified many of them. During the forego:ng phases of the proceeding, MFP had not been re'wesented by counsel. On July 28, 1993, counsel representing MFP filed a " Notice of Appearance" (which was provided the Board and parties by telefax). In a telephone conference call on July 29,1993, the Board, as provided by 10 C.F.R. (2.743(b), directed the parties to provide the Board cross-examination plans '" Ahtmugh the hst wan prouded as a pamal resp (mw to PGiE discover). the Staff was on the temce bt of the response. 193 i i l

7 i" (covering the first week of the hearing) by August 16,1993 (the day prior to the start of the hearing). Memorandum and Order (Telephone Conference Call, l 7/29/93), dated August 3,1993. All partiet did so." MFP's cross-examination plan indicated that MFP was still in the process of I reviewing documents and that its plan would be amended to reflect any additional documentation. Simultaneously, on August 16, 1993, MFP distributed (to all parties and the Board) a document - termed a " road map" (Tr. 578)- that in !e effect supplemented the cross-examination plan and identified 219 exhibits that . MFP intended to introduce concerning Contention 1 grouped in accordance with L specified topics.u (During the hearing, MFP determined not to offer certain of these documents, and further offered a few additional documents that it had not earlier been able to identify. Moreover, at least one series of documents bore on the credibility of certain PG&E witnesses and could not have been revealed in advance to other parties without undermining their utility.) Rr a party proceeding by cross-examination only, the " road map" would represent a fair substitute for the 15-day filing requirement. Such a document, however, could not have been submitted at the same time as other parties' prepared testimony inasmuch as its formulation depends upon the conter if the other parties' direct testimony. Because we heard no objection to our r mg of simultaneous submission of prepared testimony, we in effect made it impassible for MFP to observe the 15-day time frame for filing. In fact, given the change in MFP's representative, the filing on the date prior to the hearing was about as timely as could reasonably be effected. Addit onally, we made it clear that we would afford parties (or the Board) additional time within which to examine documents offered into evidence that they had not previously had an adequate time to examine. Tr. 581-82 (Licensing Board). To the extent that additional time for reviewing documents may have been sought, we made every attempt to grant such requests. Given this history, we are declining to take the course of action sought by the Staff. Although it may have been more difficult for the Saff to prepare its - case, we do not believe that the Staff was prejudiced by the late identification of certain documents, particularly in view of our offer to provide sufficient time to review the documents and the circumstance that Staff witnesses were not called upon to testify until late in the hearing, giving them time to review documents presented earlier. See, e.g., Tr. 2183-89 (re: MFP Exh. 5); Tr. 2226 (re: MFP Exhs.105-108). Moreover, we would prefer to base our rulings on the potential H in accordance with 10 C F.R 6 2 74hbx2A the cros&caanunanon plans were subnutted only to the 1.icensmg Board and mW made ava.lable to oppusmg parties In accord with that same regulanon. we are prendmg the vanous plans to the Comnussmn's Secretary for mclusion m the record of the proceedmg U MLP funher desenhed the " road map" at an August 17.1993 preheanng conference immedsately precedmg the evidennary heanns See Tr $78-82. The topics m the road map' were not co exicauve with those ident hed in MFP's June 21,1991 disctwery response 198

pg N' e ~ p., fi [ ': L safety significance of the case 'MFP presented, not on procedural technicalities p

that would eliminate from the record essentially all information contrary to the virtually single view being espoused by PG&E and the Staff.

We turn now to the two contentions before us. ' IV. CONTENTION I (Maintenance / Surveillance Program) t Contention I reads as follows: The San Luis Obispo Mothers for Peace contends the Pacinc Gas and ElectridCompany's s proposal to extend the life of the Diablo Canyon Nuclear Power Plant for more than 13 years (Unit 1) and almost 15 years (Unit 2) should be denied because PG&E lacks a sufficiently H effective and comprehensive surveillance and maintenance program. l. . LBP-93-1,37 NRC at I415.. LC 'Ihis contention was addr'essed by a panel of witnesses from PG&E consist- . ing of:. Bryant W. Giffin, Manager of Maintenance Services (DCPP); William G. Crockett, Manager of Technical and Support Services (DCPP); David A. g Vosburg, Director of the, Work Planning Section, Maintenance Services Depart-ment (DCPP); Steven R. Ortore, Director of the Electrical Maintenance Section, Maintenance Services Department (DCPP); Tedd Dillard, Supervisor of Com- - ponent Programs for the Nuclear Division of Florida Power & Light Company; and David B. Mik!ush, Manager of Operational Ser. ices (DCPP).') 'lhe NRC Staff presented testimony of a panel consisting of: Paul P. Narbut, Regional Team Leader, Region V, Division of Reactor Safety and Projects; Mary H. , Miller, Senior Resident Inspector (DCPP), Region V; and Sheri R. Peterson, Senior Project Manager (DCPP), Office of Nuclear Reactor Regulation." All of the foregoing Applicant and Staff witnesses were qualified for their particular testimony. _

As described earlier, MFP presented no witnesses but instead chose to rely on numerous exhibits (and cross-examination based thereon) consisting of PG&E's internal Nonconformance Reports (NCRs), Licensee Event Reports (LERs) filed with the NRC, PG&E correspondence with the NRC, and NRC Staff Inspection

-l Reports (irs) and Notices of Violation (NOVs). See Tr. 576-79. i b 4 s I i

F specific resu!ts or corrective actions to maintain and/or restore equipment to its required performance level whether the aging occurred prior to or during plant operation. PG&E Test. at 6244 (Giffin). Since beginning plant operation, PG&E has also made a number of major plant modifications to improve reliability or upgrade safety-related equipment 4 that also help minimize the effects of age-related degradation on the plant over its 40-year design operating life. Among these modifications are copper removal, including replacement of all feedwater heaters and retubing of all moisture sep-arator reheaters; addition of a Condensate Polisher System; steam generator ' - blowdown rate increase; fuel design improvements; removal of Boron Injection - Tanks; reduction of the boron concentration in the Boric Acid System; installa-tion of a d'gital Feedwater Control System; Chlorination System modifications; - and installation of an on-line fatigue monitoring system. Id. at 65-69 (Giffm). PG&E also has established an aging management program pursuant to Program Directive TSI, " Plant Aging Management," that addresses age-related degradation over the course of the plant's operating life. This program collects data from new research findings, industry operating experience, the NRC, the bectric Power Research Institute (EPRI), and vendors, for inclusion in appropriate programs. Id. at 70 (Giffin). PG&E's aging management activities also include several special mainte-nance programs which have been established to monitor and manage certain critical components subject to complex aging mechanisms, as well as certain designated components with a limited life. For exampit swam generator tube degradation is monitored and managed by careful chemistry control during oper-ation and by an extensive cleaning and inspretion program during each refueling outape. /d. at 72 (Giffin). The reactor pressure vessels at DCPP are also addressed by special main-tenance programs. The DCPP Reactor Vessel Radiation Surveillance Program is designed to monitor changes in material and mechanical properties of DCPP reactor pressure vessels (RPVs) in order to ensure their continued safe operation throughout the operating life of the plant. Compliance with all NRC regulations governing RPV integrity was documented in PG&E's response to Generic Letter 92-01. PG&E Test. at 75-76 (Giffin, Crockett). Erosion / Corrosion (E/C), which refers to the process of wall thinning in susceptible piping or other pressure koundary components caused by the flow of water or wet steam, is a normal part of the nuclear power plant aging process. The management of E/C is an integral pan of maintenance at DCPP. Measures to j control E/C include the replacement of certain piping with E/C-resistant material such as stainless or chrome-moly steel. /d. at 77-78 (Crockett). PG&E's testimony also indicates that it has a program for managing the aging of passive, long-lived structural concrete and steel at DCPP. Conditions such as t - spalling or cracking of concrete, corrosive or caustic attacks from leaks, spills, 201 i r

~ M ' or exposure. to' the environment, mechanical damage, and rust are routinely ' dentified and reported by plant personnel. Id 'at 81-82 (Giffin).- PG&E's [ i - maintenance work at the intake structure is an example of this process. Tr.1737- ~ 38 (Giffm).' This type of maintenance is meant to ensure that these structures a will perform.their intended functions for the life of the plant..Tr. 1741 l l . Giffin).. Ibr safety-related structures, functional surveillance requirements are ( specified in Technical Specifications. Periodic surveillance testing verifies th'e l operability of these structures. PG&E Test. at 82 (Giffin). t C. Evaluation of Evidence - Turning to the merits of the contention, we find that all of the expert witnesses- - both PG&E and the Staff - testified as to the adequacy'and indeed the f f excellence of PG&E's maintenance / surveillance program. As summed up by the Staff: ~ i The performance of maintenance and surveillance at Diablo is considered to be superior i and clearly supportive of safe facility operation.. Their performance has been, at worst, good and has improved over the years. Gradual trends over the past seven years show ~ i a reduction in the reumber of equipment failures, reduction of significant safety problems, ' { increased management involvement in maimenance issues, and more timely identification and resolution of problems. Some examples of poor performance in each of these areas - contmue to be identified. liowever, these examples have been of decreasing frequency and .l safety sigmfics.ce. Staff Test., ff. Tr. 2159, at 5-6 (Narbut, Miller). I MFP challenges the adequacy of the maintenance and surveillance program by i claiming that the program fails to satisfy a number of broad standards necessary for a satisfactory program. It cites numerous particular incidents to demonstrate j how the program fails to satisfy these standards (some incidents are relevant to I more than one of the broad standards). The broad standards set forth by MFP, in outline form, are as follows: -f I.. Failure or unreliability of important safety systems. A. Reduction in safety margins. Most of PG&E's maintenance problems in the past several years have disabled or threatened -[ essential safety sysLas. l B. Inadequate and incorrect analyses of safety significance. PG&E. i e wrongly discounts the safety significance of many of its mainte. l nance deficiencies.' 'Ihis not only results in an incorrect evalu- - i ation for purposes of evaluating the significance of the incident i t MIP FoF Tl2041 at ll 29 1.ater an the test of this Decision. we shall refer to various authne topics by tle paragraph nurnbers set furth herem q 202 y i t ( I j e ? t .m, .- - ~

c l> b }q that occurred, but it also raises general questions about the ade- ' quacy of PG&E's judgment with respect to safety matters. !!. Untimely or Ineffective Response to Maintenance Problems. A. Untimely Response. PG&E has shown a pattern of responding r to maintenance problems in a tax and untimely manner. B. Previous Corrective Action Failed to Prevent Recurrence. In many cases, PG&E had the same or similar problem recur after PG&E had attempted to resolve it. This shows an ineffectual maintenance program that is unable to take timely and effective . corrective action with respect to maintenance problems. C. Untimely Detection and Correction of Aging Effects. III. Breakdown of Multiple Barriers. IV.' Repetitive Patterns of Failure. A. Lack of Communication and/or Coordination.. PG&E's mainte ' nance and surveillance program is deficient in its communication and coordination between different groups of individuals and/or depanments. Examples are provided for insufficient communica-tion, insufficient coordination between multiple groups, and in-sufficient management involvement. B. Previous Maintenance Errors Caused Undetectable Problems. PG&E has demonstrated a pattern of creating undetectable fail-ures through improper maintenance. C. Inadequate / Improper Surveillance. houtine surveillances, tests, and inspections at DCNPP are inadequate to ensure the continued safe operation of the plant. D. Personnel Errors. PG&E has demonstrated a repetitive pattern of personnel errors which jeopardire the safety of the plant. Exam-pies are cited dealing with personnel errors due to inattention to detail, personnel errors due to failure to follow procedures, and i personnel failure to self-verify. E. Inadequate Procedures. Procedures or work instructions for personnel are not adequate to ensure that work activities are performed adequately. F. ManufacturingNendor Deficiencies and Internal Defects. PG&E does not have an effective program for detecting manu.' cturing deficiencies or internal defects. 1 G. Financial Considerations. PG&E's decisions regarding what is needed to maintain the plant in a safe condition have been unduly } 't influenced by economic considerations. We will individually discuss each of the particular incidents set forth by MFP in its proposed findings and relate them to the broader standards outlined by MFP. We will discuss them in the order presented by MFP in its specific t 6 203 i

proposed findings, and will relate them to all the broad standards to which MFP I claims they are relevant. Maintenance of Environmental Qualification of Electrical Equipment L MFP asserts that PG&E's maintenance program for the environmental quali-fication of electrical equipment is fatally flawed because of imperfections in the so-called "telatemp" sticker program." MFP categorizes this claim as an ex-ample of a maintenance problem that has disabled or threatened essential safety systems (outline 11.A). In support of this claim, MFP questioned PG&E witnesses on the basis of MFP Exhibits T-1 through T-4. T-1 is a copy of NRC Information Notice 89-30, High Temperature Environments at Nuclear Power Plants, dated March 15, 1989." T-2 is a copy of PG&E implementing procedures, dated April 22,1992. 27, 1990, concerning T-3 is a consultant's report to PG&E. dated February "Effect of Localized High Temperatures Upon EQ Components." T-4 consists of numerous sheets recording data from telatemp stickers." MFP asserts that maintenance of the EQ of electrical equipment that is important to safety is fundamentally important to the safe operation of DCPP, that the qualified life of such equipment is partially determined by assumptions about the normal operating temperatures to which the equipment will be exposed, and that if the normal operating te nperature exceeds the assumed MFP normal operating temperature, the qualified life "must" be shortened. FOF 165. MFP contends that, as a result of PG&E's poor management of the telatemp sticker system, the temperatures in many locales are unknown and, for conservatism, the qualified life on many components must be shortened. 'Ihe Applicant describes its EO maintenance / surveillance system as a por-tion of its program designed to comply with the requirements of 10 C.F.R. 550.49, which sets forth substantive requirements for an EQ system and de-fines equipment to be included (but sets no special standards for a maintenance and surveillance program applicable to such equipment). The EQ program is designed to ensure that electrical equipment that would be relied on in the event of an accident will be capable of performing its design safety functions to achieve safe reactor shutdown, despite exposure to the harsh environment that in the transcript and in MIP's IoF, the term is spelled "teletemp." In MIP Exh T.2 (a PG&E docunrro and l i h Decismn the Apphcant's and staff's FoF. the term ss spelled "telaterf We wdl use the latter spe hng n t is "This docuncis was identified and extenmely diwussed at the heanng by a PG&E witness but w MITs questmns were directed at a PG&E wnness but. because lah. T.! furmally adnuned into evidence d basis appeared several days later. In any event. the PG&E wuness's respone to questias provult an a equate 1844-45.186142 (Onoret for referenems tir docunent terem Scr. e r. Tr. "MFP Eshs T 2 throush T.4 were admitted mio evidence at Tr. 2051. 204

sm - ~, i could result from an accident. Among other matters, the EQ program includes i. L the determination of a " qualified life" based on expected service conditions and. ' identifying and implementing appropriate surveillance, maintenance, and pro-curement requirements to ensure that EQ is maintained. PG&E Test. at 16-18, 79-81 (Ortore). At DCPP, the qualified life of.a safety component is based on the bulk ambient temperatute of the area in which the component is located. However, localized temperatures may be higher than ambient temperatures as defined in the " binders" that document the basis for the qualified life of each safety component. Tr. I856-57 (Ortore). In 1986-87, the Maintenance Department initiated the telatemp program, a proceduralized temperature monitoring program for EQ equipment - This. . predated NRC generic correspondence (Information Notice 89-30, proposed MFP Exh. T-1) that raised an issue regarding the potential impact of operating temperatures on equipment performance and qualification. Tr. 2N3 (Ortore). p As a result of this program, PG&E identified Jcular " hot spots" at DCPP. It then contracted with Sargent and Lundy for a report to address " hot spots" and the effects of localized temperatures on the qualified life of EQ equipment. nrough these activities, various " hot spots" were identified allowing calculation of a qualified life for EQ components based on observed environmental conditions. Tr. 1853, 2043 (Ortore); MFP Exh. T-3. The telatemp monitoring procedure is used principally by the Electrical Maintenance Section at DCPP to monitor electrical equ~pment and hot spots. PG&E has issued a procedure for implementing that program, MP E-57.8A, MFP Exh. T-2. Tr.1845, 2N5 (Ortore); PG&E Test. at 81 (Ortore). De procedure was last revised in 1992 (Tr.1891 (Giffin)). He list of components subject to the monitoring procedure does not include all instrument and control (I&C) EQ equipment at DCPP. PG&E testified, however, that most I&C equipment is, by design, located in areas that are low in containment or outside the bioshield. Furthermore, most I&C components are low voltage, low-current equipment that does not generate significant heat. As a result, most I&C equipment is subject to temperatures well below 120 and need not be included in the temperature monitoring program. Tr.1875, 2045-46 (Ortore). Further, DCPP is a very large and uncongested plant and this factor, along with other design features (e.g., ventilation, routing of power cables), reduces the likelihood of hot spots. PG&E Test at 80 (Ortore).1 The Maintenance Department utilizes telatemp stickers to monitor local ambient temperature at EQ components. Id. at 80-81 (Ortore). These stickers are tabs with mylar faces that include squares with temperature-sensitive chemicals which turn color when they are exposed to certain temperatures. The squares record momentary peak temperatures at the point of installation. During refueling outages, maintenance personnel read and record the data provided by 205

the telatemp stickers, remove the stickers, affix them to data sheets, and apply. new stickers at each location. He temperature is recorded on a form. Tr.1846-47,1855, 2041, 2043 (Ortore); MFP Exh. T-2. MFP asserts that the telatemp stickers generally give readings in 10 intervals, and that when a window changes color, that means the component experienced a temperature that was between the degree of the window and 9' higher. MFP cites PG&E's testimony of the importance of applying conservatism in using the telatemp readings and would have us assume that the safety component being evaluated experienced the highest possak temperature that is indicated by the changed telatemp sticker window. Thus, if the 150 window changed color, MFP would assume that the component experienced a temper;ture as high as 159*. Tr.1861 (Ortore). PG&E's witness was not certain exactly how these data would be used but agreed that conservative assumptions would require such an interpretation (Tr. 1855,1861 (Ortore)). He Staff initially would have us ignore the documents on which MFP relics, because oflack of adequate advance notice of MFP's intent to use them. Beyond that, the Staff perceives no merit to MFP's claims premised thereon. For L the reasons outlined earlier, we are declining to ignore these documents. In particular, we regard as sound MFP's claims that the documents have potential safety significance that could have a material bearing on the adequacy of the maintenance and surveillance program. De temperature monitoring program provides PG&E with a system to identify any localized areas in which EQ equipment. night be exposed to temperatures in excess of the operating temperature previously assumed in the qualified life calculations for that component. If monitored operating temperature exceeds that previously assumed, it may be necessary to reduce the component's qualified life. The qualified life of an installed component is then based on the highest temperature data, unless there is reason to believe that a high temperature was only transitory. Moreover, in performing the qualified life calculation, PG&E generally assumes that the highest temperature registered on the telatemp sticker has been and will be the constant temperature over the service life of the component. Tr. 1842-43, 2042-43 (Ortore). 3 The data gathered by the Maintenance Department are provided to the Engi-neering Department, which, in turn, analyzes such data and determines whether it is necessary to change the qualified life of EQ equipment; Information re-sulting from engineering analyses is sent back to the Maintenance Department,. which has the responsibility to change out such equipment prior to the end of its qualified life as part of the preventive maintenance program. hus, calcu-lation of the qualified life of EQ equipment is not a Maintenance Department function, although ordering the repair or replacement of EQ equipment based on recalculated qualified life is such a function. Tr. 1850-51, 2Gil-42 (Ortore). 206 i i e i

' PG&E describes the telatemp monitoring program as confirmatory in nature. In other words, it is not the principal means employed by PG&E to ascertain _ localized peak temperatures. PG&E indicated that, since the original hot spots were identified, it has seen very few changes in normal operating conditions. Tr. 2043 (Ortore). l MFP attempts to disprove this testimony by the telatemp data in MFP Exhc T-4. ; For example, it claims that readings for selected valves and conduits had temperature variations over a period of years as much as 69* (MFP FOF, Tables A and B). MFP also introdund numerous data sheets into the record, to demonstrate that telatemp stickers are sometimes destroyed upon removal, l hard to read, otherwise unavailable, or where there either were no telatemp measurements or measurements were incomplete (Tr. 1882-84 (Ortore); MFP Exh. T-4). It demonstrated that there were no telatemp readings for certain components or general plant areas, that readings of "N/A" or "NA" appeared on many data sheets possibly indicating, according to the PG&E witness, that only one sticker was found (when two were required), that a sticker was illegible, that there was no sticker below, that a sticker could not be moved without damaging it, and that many stickers could not be found (Tr.1887 (Ortore); MFP FOF, Tables A and B). MFP went on to assert that, although MP E57.8A generally requires stickers for both the top and bottom of components, many of those dual stickers were i not present. It emphasized the importance of the dual-itker requirement by demonstrating the considerable temperature variation that could occur between the top and bottom of components. MFP claims that the problem dates from 1988, when the first telatemp measurements were recorded, to the most recent refueling outages for each unit. In addition, MFP claims that an adequate range of temperatures on stickers is not present, setting forth certain components where four rather than two stickers should be used and others where the highest temperatures recorded were not the peak temperatures, only the highe.t that the stickers could record. Finally, MFP claims that the procedures for telatemp measurements are confusing and hence inadequate. It cites the incomplete lists of equipment to which the program applies (or is intended to apply), the limitation of the procedure to instructions for installation and removal of sticker < without sufficient guidance on how to record the data from the stickers onto the data sheets. Indeed, one of the data sheets contains an explicit complaint that " procedure should explain how to read stickers." In short, some of MFP's claims are well founded. The Board finds that PG&E's procedures for telatemp sticker installation are confusing, and that as a result it is difficult to determine exactly obere stickers should be installed and monitored. The requisite terminoloFy on data sheets is also confusing - e.g., 207 e

N/A or NA may refer to the fact that a new piece of equipment was installed, or to the fact that a telatemp sticker was not found or could not be read. N/A or NA on data sheets could also apparently mean either "not available" or "not ~ applicable." Tr.1886-87 (Ortore). The list of equipment in the applicable procedure to which stickers are to be affixed is also not representative of all the equipment to which stickers are attached (Tr.1882 (Ortore)). A failure to list a temperature could mean either an erroneous listing or a failure of the temperature L . to be high enough to warrant a listing (Tr. 1885-86 (Giffin)). Occasionally the [' PG&E witness was not certain what a particular recorded number meant (Tr. 1889 (Ortore)). ' We are also concerned about the level of accuracy of the telatemp measure-ments, given the many instances in which PG&E recorded only one measurement rather than the required two or, indeed, the four that should perhaps be available, This pattern leads us to believe that, to the extent PG&E relies on the telaiemp program, systemic improvements should be made to reduce or climinate such inconsistencies. In sum, it is fundamentally important that PG&E have an adequate program for maintaining environmentally qualified safety equipment. This includes monitoring equipment where temperatures are known to be high, to ensure that the normal operating temperature is not higher than the conditions to which the equipment was originally qualified. If it is, the qualified life may have to be reduced and the equipment replaced. The Board recognizes that the telatemp program is confirmatory only. But to the extent it is t,eJ m monitoring these localized high temperatures, it is deficient in that it i:, not being carried out in a consistent and accurate manner and PG&E does not have adequate procedures to ensure that it can be carried out properly. To the extent of that deficiency, MFP's assertion that PG&E's telatemp sticker program reflects a reduction in contemplated safety marF ns and a potential threat to essential safety systems is i well founded. The documents relied on by MFP do not, however, constitute a sufficient basis upon which to conclude that there is an overall programmatic deficiency in the i maintenance of EQ equipment at DCPP. As noted, the temperature monitoring program is confirmatory in nature; i.e., it continually confirms the validity of the input data used in qualified life calculations. The significance of any imperfections in the data collection process will, to that extent, be alleviated. Moreover, the exhibits are replete with examples where more than one telatemp sticker is used on an EQ component. See MFP Exh. T-4. Where more than one is required by procedures, however, those examples do not serve to ameliorate the deficiencies outlined. in conclusion, although the telatemp procedure is not per se required for PG&E to conform to the EQ requirements of 10 C.F.R. 6 50.49, we believe that where, as here PG&E elects to utilize such a program as part of its 208 l J

f [ F L maintenancehurveillance program, it must have adequate procedures (1) that defme all the equipment on which the stickers are to be utilized, (2) that set forth the number and location of the stickers to be used for each piece of designated r equipment, (3) that specify the time, method, and precise nomenclature for recording the temperature data, and (4) that ensure that the information utilized is not erroneous or misleading. To the extent PG&E places any reliance on such a program (even if only confirmatory, as claimed), it should revise its procedures to incorporate these changes. We are imposing orders for correction to this effect." 2. Check Valves /IST Deficiency MFP introduced several NCRs and LERs to demonstrate that PG&E's inser-vice testing (IST) of check valves is deficient (MFP Exhs. 6-11,13). It claims that, as a result, safety systems have been disabled or threatened (outline I.A), that routine surveillances, tests, and inspections at DCNPP are inadequate to F ensure the continued safe operation of the plant (outline IV.C) and that pro-cedures or work insuuctions for personnel are not adequate to ensure that work activities are performed adequately (outline IV.E). For many years, the ASME code did not require testing of leaktightness of check valves if their position was normally closed (Tr. 602 (Crockett)). Ilowever, on August 29,1988, the NRC issued IN 88-70, " Check Wlve Inservice Testing Program Deficiencies," to notify licensees of potential p:al. ems with check valve IST. NRC Generic Letter 89-(M. " Guidance on Developmg Acceptable Inservice Testing Programs," dated April 3,1989, identified similar generic concerns and required that implementing test procedures be reviewed and revised as necessary within 6 months. The NRC was concerned that check valves included in the IST program were not always tested in both the open and closed positions and that no reverse flow operability tests were being performed on check valves other than those used for containment isolation and reactor coolant system pressure boundary isolation. MFP Exh.11 at 2. PG&E initiated the review required by the Generic Letter (MFP Exh.13 at 2). MFP claims - accurately - that, as a result of PG&E's review, a multitude of deficiencies in the check valve IST program have been (and continue to be) identified. MFP FOF 98. The fi~'ing of these deficiencies does not, however, deno ninate a current breakdown or failing in PG&E's maintenance program. Rather, the NCRs and LERs cited by MFP demonstrate PG&E's attempts to bring its own maintenance and surveillance procedures in line with recently evolving Staff policy. As characterited by PG&E, the issue is generic. Tr. 603 ) We are here imposmg no conditmns or gmdelmes as to whetter ur tww the Engineenng Department uses the j M telatemp data 209 i l I

g 3 (Crockett). Moreover, valves added to the list for testing had never been found to be leaking. Tr. 608 (Crockett). Hus, PG&E's performance in this regard appears to be adequate and cannot serve as a basis for either license denial or conditions. 3, Cable Failures . MFP introduced evidence to the effect that there were five medium-voltage cable failures at DCPP between October 1989 and March 1993 - three of which were on 4 kV cable and two on 12 kV cable - and it claims that PG&E's maintenance and surveillance program was not adequate to detect the degradation of this cable (outline 1IV.C). MFP FOF a50,108,112. One of these failures was detected only by smoke occurring as a result of the failure. MFP Exh.15 at 5. According to MFP, an essential safety system is thus threatened (outline 11.A). MFP further asserts that PG&E has not identified the cause of the three 4 kV failures and cannot justifiably claim that they are random occurrences. MFP FOF i15. MFP also faults PG&E for delay in replacing certain of these cables and for replacing them with the same construction material, as to which it asserts there is some question of acceptability for the conditions under v hich it is operating. Id. 1 119, 126. These failures thus also represent an untimely response to a maintenance problem (outline _111.A) and untimely detection and correction of aging effects (outline II.C). He five failures occurred in two separate sets of underground duct bank conduits, between the turbine building and the intak.e structure. MFP Exh.15 at 3. The Applicant asserts first that there is no connection between the failures of the 4 kV and 12 kV cables. See MFP Exh. 21 at 1-2 (Two of the three 4 kV cables are safety-related, whereas one 4 kV cable and both of the 12 kV cables are not. MFP Exh.15 at 3; PG&E Test. at 108 (Ortore); Tr. 624 (Ortore).) It testified that two of the 4 kV failures were random in nature and time of occurrence (October 29.1989, and May 3,1992), whereas one occurred during a routine high-potential test during a refueling outage (October 31,1992). PG&E Test. at 108 (Ortore). PG&E conceded that, at the time of the hearing, it had not yet completed its root-cause analysis of the 4 kV cable failures. But, it had ruled mt certain possible causes, including the chemical attack and degradation that had been determined to have caused the 12 kV cable failures. Tr. 625 (Ortore); MFP Exh.15 at 9. It also determined that the failed cables were of acceptable quality. and design for their specific applications and service conditions. Both the failed and certain unfailed sections of these cables have been replaced. PG&E Test. at i10. In addition, because of defense-in-depth redundancy, the ultimate safety significance of a 4 kV cable failure is likely not to be great. 210

e . The 12 kV failures occurred, respectively, in February and March 1993. PG&E testified that both were the result of external cable degradation, caused initially by exposure to an unidentified contaminant, probably a cleaning agent, present in the underground conduits for the 12 kV cable. The contaminant was carried within the conduit by water, which degraded the outerjacket of the cable, exposing the copper shielding. De shielding was then attacked by chlorides in saltwater present in the conduit, creating uneven electrical stresses on the cable and thus causing a fault. PG&E Test. at 109 (Ortore); Tr. 649, 671 (Ortore). De failed 12 kV cables and certain other sections have likewise been replaced. In addition, PG&E found a contributory cause of these failures to be inoperable sump pumps in the cable vaults. Prior to the 1993 failures, these pumps were not included in the formal mamtenance program. The pumps have now been repaired and are included in the preventive maintenance program. PG&E Test. at i10; MFP Exh.15 at i1. With respect to the 4 kV failures, the Staff concluded that PG&E's responsive actions were adequate and reasonably thorough. The Staff further concluded that plant safety had not been significantly reduced by these failures, because of the presence of other, unaffected cables for redundant safety-related pumps. Staff Test., ff. Tr. 2159, at 10 (Narbut). With respect to the 12 kV failures, an NRC inspection verified the repair of inoperable pumps, the initiation of preventive maintenance for such pumps, and the replacement of all failed cable. The Staff would have us fmd that, with the sump pump added to the maintenance program and the cable replaced, it is unlikely that such a aole failure will recur. Staff FOF11-84. We find that PG&E's responses to these failures were reasonable and effec-tive. Even though not on safety-related cable, however, the fire resulting from one 12 kV failure appears significant,if for no other reason than that fires are per se hazardous. PG&E's corrective actions, approved by the Staff, eppear adequate. 4. Wrong Si:e Motor Installed Premised on a PG&E draft NCR dated July 28,1993, MFP Exh. 24 NCR DC2-93-EM-NO31, together with related testimony, MFP asserts that, during a refueling outage, a 10 ft-lb motor was installed on a motor-operated valve (MOV) rather than the required 15 fi-lb mctor, that this mistake was caused by multiple personnel errors, and that barriers designed to prevent such errors were ineffective, evidencing a programmatic deficiency. MFP stresses that, although installation of the wrong motor may be at Gutable to an isolated personnel error, the failure of "not less than three oth;r individuals" responsible for checking the correctness of the installation cannot properly be so designated and, rather, is an indication of a programmatic deficiency in the maintenance / surveillance 211

l program. MFP further describes what it perceives to be the safety significance of the erroneous installation. MFP FOF 11144-51. It categorizes the erroneous ' installation as threatening an essential safety system (outline II.A), as a series of personnel errors resulting in a breakdown of muhiple barriers (outline 1111), and as an example of a repetitive pattern of personnel errors which jeopardize the safety of the plant (outline 11V D). PG&E acknowledges the erroneous installation, claiming that an individual preparing a work order to replace the motor on an actuator for s MOV made an error in reading the motor size from a table and hence specified on the work order an erroneous motor, which was later installed. 'Iir. 689-90 (Giffin). It characterizes the incident as an isolated personnel error. PG&E FOF 1M-A21. He Applicant as well as the NRC Staff, however, deny the incident's actual or potential safety significance. Based on the NCR, they assert that, even with the undersized motor, the MOV was able to shut under design-basis conditions and thus would have performed its intended safety function.2i As for corrective action, PG&E replaced the incorrect motor and checked other similar motors to verify their correctness. It also counseled the work plan-ner and the QC in.<pector involved with this event, communicated the importance of self-verification to incoming persons through the electrical maintenance bul-letin, and held meetings with electrical maintenance engineers to discuss the importance of the engineer's responsibilities and expectations when they spon-sor design control notices. MFP Exh. 24 at 1,6-8; Tr. 690-91 (Giffin, Vosburg). It is clear to us that PG&E took appropriate a:ti n to replace the hardware involved, and to ensure that incorrect motors had not been installed elsewhere. More important, the Applicant also took significant steps to alleviate the maintenance deficiencies. Dat three individuals were responsible for four personnel errors is not, however, reassuring.:2 For these reasons, license conditions would not be appropriate. Nonetheless, because similar incidents might well hase safety significance given the wide variety of parts in a nuclear facility that conceivably could be incorrectly utilized, PG&E may wish to explore whether some systemic improvements could be made in this area. Improvement might be particularly appropriate with respect to the process of self-verification by installers. For example, perhaps the self-verification process could require a second look by the installer at the design change document, as well as at the installed part. 21MI P Exh 24 at 11; staff I-oF 18-h6 The NCR adds. however. that " lilt is not hkely that the valve would inp the tonpe switch at reduced vchage and with the Thermal overload Device (TOLD) sired for a 15 ft-lb enator. j care it goes closed et would probably burn out the rnotor. Tius would happen only after the valve had perfortned its safety function" 22MFP's idenh6 canon of four separate indmduals (MT P f or 1147) appears erroneous - the wosker who failed the scif-idenuncanon appears to be the sanw as the esistaller, resulting en errors by three andmduals. 212 l 2 l l l l i

5. Storage and Handling of Lubricants Relying on two NCRs, MFP asserts that failure to control lubricants is - a recurrent problem at DCPP and demonstrates a deficient maintenance and. surveillance program. MFP F0F 1162. MFP categorizes the alleged deficiency as an example of a previous corrective action that failed to prevent recurrence (outline 111.B) and as a repetitive pattern of personnel errors due to inattention to detail (outline IV.D). Specifically, MFP cites " unlabelled and mislabelled grease guns and oil pumps; cross contamination of greases and oils; the use of wrong oils; and failure to maintain log books." MFP FOF 1152, citing MFP Exhs. 27 and 28. MFP notes that the issue was first identified in 1987, that additional problems occurred in 1991, and that, despite corrective actions, similar problems occurred in 1993. MFP asserts that PG&E received an NOV in 1987 for failure to comply with the procedure governing control of lubricants. In 1990, the wrong oil was added to the " heater 2 drain tank pump 2-1." In 1991, the wrong oil was added to a motor bearing. Also, PG&E wrote an NCR considering other discrepancies in lubrication storage and handling. MFP further claims that, in 1993, an incompatible oil was used to lubricate the auxiliary saltwater pumps and that the oil log book did not indicate where or when this oil was obtained. MFP Exh. 27. MFP attributes all these deficiencies to the maintenance and surveillance program. He Applicant characterizes the problem (citing the same MFP exhibits) as involving several minor lubrication control issues widely separated in time and dissimilar in nature. It claims that corrective actions have been adequate and existing procedures sufficient. PG&E FOF 1R-A32. The Staff takes a similar position. Staff FOF 11-91 through I-93. PG&E further disputes MFP's claims of safety significance, terming them as based on extra-record speculation, inasmuch as only small amounts of oil or lubricants were involved, with no impact on equipment operability. The Applicant further points out that existing preventive maintenance tasks ensure that oil is periodically changed and sampled and that equipment is monitored for excessive wear. PG&E FOF 1R-A33. The Staff concurs. Statf FOF 11-94 He Board here supports the position taken by PG&E and the Staff, to the effect that the incidents are essentially isolated and reflect na systemic deficiency in the maintenance and surveillance program. They represent neither a recurrence of a previously corrected problem nor a repetitive personnel error. Given that finding, as well as the circumstance that the amounts of oil or lubricants involved were small and could cause no operational impacts, we agree that the incidents lack current or potential safety significance. 213

7-l 6. Fuel Handling Building iL In order to ensure that all potential releases from the spent fuel pool are exhausted through fuel handling building (FIIB) exhaust filters, the fuel pool i = area must be maintained at a negative pressure. MFP Exh. 39 (LER-89-019-00) at 4; MFP FDF 1167. MFP has cited several instances in which the negative pressure was not maintained adequately, and it attributes these instances to inadequate maintenance or surveillance. MFP FOF 1 170,173,177,181,184. ' MFP categorizes these examples as ones where safety systems were disabled or threatened (outline II.A), as an untimely detection and correction of aging effects (outline III.C) and as an inadequate or improper surveillance (outline 11V.C). Two instances in particular, both in 1991, were identified.23 He first was discovered on January 18,' 1991, when the FHB ventilation system was declared inoperable after failing to meet the negative I/8-inch water gauge pressure requirements specified in surveillance test procedure (STP) M-41. The STP M-41 had last successfully been performed on September 18, 1989, and the January 18,1991 surveillance was the routine 18-month followup surveillance. MFP Exh. 39 (LER-89-019-00) at 2. The second occurred on August 7,1991, when the Unit 2 FHB failed to pass STP M-41. MFP Exh. 38. The root cause of the first of these events was determined to be "the degradation of the FHB." Contributory causes were " dirty exhaust fan ducts, failure to maintain a flow difference between the exhaust md supply flows of 19.8 percent, and blocking of a FHB exhaust duct." The rc ot cause of the second event was "an improper understanding of the required calibration frequency of the supply fan inlet vane controller." MFP Exh. 38 at 1, Il-12. PG&E took corrective action for each of these deficiencies. Id. at 1. No issue appears to be raised concerning the adequacy of any particular corrective action. MFP, however, attributes the deficiencies to lack of an effective preventive-maintenance program for the FHB. MFP FOF 170. PG&E points out that in each instance the pressure was negative, although not as negative as required, thus reducing (in its opinion) the safety significance of the incidents. PG&E F0F 1 M-A41, citing MFP Exh. 38 at 2-3,13-14. He Staff agrees. Staff FOF 11-95. However, PG&E acknowledged that its preventive-maintenance program covered 111B doors and ventilation system components but not the building as a whole. With respect to the first instance, PG&E promptly investigated the situation, determined the root cause, and implemented corrective actions. PG&E Test. at 104-05 (Crockett). It determined that the cause of the deficient negative 23 MrP bh 38 Docunrnas relanng to other FHB madents were not adnutted, because they tue no relationship to maintenance or surveillance. See Tr 827 28 214

f-pressure was the existence of small leakage paths into the building, resulting from degradation of building siding and seals. This was an example of structural ' degradation that was identified by PG&E and corrected. Tr. 807-08 (Giffm). Corrective actions included sealing the leaks and re-siding both FHBs. Most significantly, surveillance is now performed within 7 days of any fuel movement, (. rather than at the previously prescribed 18-month intervals. Tr. 812 (Crockett). The second instance of reduced negative pressure rest:lted from drifting of [ the serpoint for the controller, increasing the supply flow into' the FHB. MFP Exh. 38 at 3. The drift was identified througis surveillance and later corrected. Although the Applicant and Staft deny that these instances reflect any deficiencies in the surveillance program - indeed, they credit the program for i detecting the instances of negative pressure - we find it significant that an important corrective action was to increase the frequency of surveillances. To that extent, the previous surveillance program did result in the untimely detection and correction of aging s ects (as claimed by MFP) and hence warranted T improvement. The prompt modification, hawever, demonstrates the strength of PG&E's overall program. We find no evidence that would permit us to question (as MFP does, at MFP FOF 181) the adequacy of the current surveillance program for the FHB. 7. Tests of Containment Personnel Airlock MFP has identified what it describes as several misse,' surveillances of the airlock door seals and portrays them as failures of the surveillance system. It categorizes them as disabling or threatening safety systems (outline 1 LA) and as examples of a repeat pattern of inadequate performance of routine surveillances, j tests and monitoring activities (outline IV.C). MFP also faults PG&E for minimizing the significance of the inissed surveillances. MFP FOF 52. l The first two occurred on September 20 and 21,1990; another occurred on April 25, 1993. In each case, a personnel airlock gauge was removed (for maintenance) and later reinstalled, but required post-maintenance leak rate testing within the period specified by the Technical Specifications was not performed. MFP Exh. 42 (NCR DC2-93-WP-N025); MFP Exh. 43 (LER 2-l 90-011-00); Tr. 830-32 (Vosburg). MFP also cites a final missed surveillance that occurred on June !!,1991 (but was not discovered and reported until September 27,1991). The LER states that "[a] review determined that an acceptable leak rate test was not performed following 17 containment entries during the period from June 11,1991, to September 27, 1991." MFP Exh. 44 (LER l-91-016-00) at page numbered 1 (2 of exhibit). The immediate cause of the missed surveillance was a faulty solenoid valve, with root cause attributed to personnel error caused by inadequate knowledge of the leak-rate monitor operation. 215

y he Applicant and Staff each treat the 1990 and 1993 incidents as separate and apart from the 1991 incident (which,' as indicated above, was attributed to personnel error). Analytically, however, there appear to be more interrelation-ships among all of the four separate incidents. Thus, PG&E initially believed that the 1990 and 1993 incidents were also the result of personnel error. It changed its opinion when it discovered what it deemed to be faulty instructions to the workers who were servicing the gauge. Tr. 830 (Vosburg). And the 1991 incident, although attributed to personnel error, resulted in fact from deficient documentation - i.e., an inadequately documented clearance to take the leak-rate monitor out of service for calibration. f MFP Exh. 44 at 3 of LER (fourth page of exhibit). Collectively, therefore, it appears te us that all of the incidents in question may be properly perceived as resulting, not from individual personnel errors but, rather, from less than complete instructional material for those performing the maintenance-related servicing or calibration. Improvement in the procedures and associated instructions seems to be the proper corrective action and, indeed, ' has already been implemented. MFP Exh. 42 at 9-10; MFP Exh. 43 at 1,6 of LER (pp. 2,7 of exhibit); MFP Exh. 44 at 1,7-8 of LER (pp. 2,8-9 of exhibit). AlthouFh these incidents all seem to have a bearing on the adequacy of the maintenance and surveillance program, and although they have safety significance, they do not appear analytically to cast any strong adverse inferences about the program. In panicular, corrective action apparently has countermanded the seeming deficiencies that were brought to our atten<o: We thus decline to include these instances among adverse information that would detract from the sought extensions of the operating licenses. One comment on " numbers" is, however, in order. The Applicant has char-acterized these missed surveillances as among sixty.fise missed surveillances throughout the 10-year history of the facility and has compared that number to r the over 10,000 total tech-spec surveillances that take place annually. PG&E adds that in 1992 it missed only three surveillances and in 1993, up to August, it had missed only one. Tr. 836 (Crockett). PG&E witnesses were questioned about the accuracy of these numbers, given the statement in MFP Exh. 44 (quoted above) that a single missed surveillance had resulted in 17 containment entries, each of which would require a surveillance. Rey explained that missed surveillances were grouped by root causes and that all stemming from the same root cause were considered the same missed surveillance. Tr. 834, 836, 845, 848-53 (Crockett, Vosburg, Giffin). MFP considers these statistics to be misleading. Tr. 853 (Curran); MFP FOF 152, 190. On the other hand, PG&E supported its methodology by explaining - that it helped it to gauge the effectiveness of its program, as well as to correct the root cause of a missed surveillance. Tr. 846-47 (Vosburg). The Staff adds 216

g that industry and the NRC accept this practice as appropriate. Staff FOF 11 108,. citing Tr. I149 (Crockett). We agree that PG&E's methodology for counting missed surveillances is appropriate, given the common industry practice. However, it might be wise for - PG&E to add, in the context of statements to other than industry or the Staff, some explanatory preface to avoid the appearance of tranipulating statistics to make the record appear advantageous. 8. Component Cooling Water (CCW) Heat Erchanger %e CCW system removes heat generated by various plant systems without releasing radioactive material to the environmem. The DCPP has four CCW heat exchangers, two for each unit. Each CCW heat exchanger has 1237 tubes approximately 35 feet long. In March 1993, during a Unit 2 refueling outage, testing was conducted on tubes in both Unit 2 heat exchangers. The testing was part of the ISI program that looks at performance to identify and predict early if there is any degradation of equipment. Tr. 857 (Crockett). Fretting was found on the outside diameter of certain tubes, at the baffle plates. Tubes with damage greater than 20% were plugged (i.e., removed from service), including ten on one Unit 2 heat exchanger and several on the other. PG&E determined the root cause to be flow-induced vibration on the tubes, and accordingly it also revised operating procedures to address maximum flow limits. MFP Exh. 47 (NCR DCL 3-TS-N017, Rev. 00, June 15, IW3). 1 MFP claims that testing is not being conducted with sufficient frequency, that the ability of maintenance and surveillance activities to ensure the efficiency j of the CCW heat exchangers is questionable, and that the corrective actions, j maintenance, and design changes may have violated the original design criteria by improperly extending the original design flow rate. MFP FOF 203,206, 211. MFP portrays this incident as representative of a maintenance problem that has threatened or disabled essential safety systems (outline 11.A) and as an example of inadequate routine surveillances (outline IV.C) PG&E counters that the fretting was indeed detected through the surveillance program, that frequency of inspection, which is determined.on the basis of expected wear and service life, is < ~fficient, and, in any event, PG&E is studying whether increased inspections are warranted. Tr. 858 (Crockett). PG&E adds that it incorporateJ the design-basis maximum flow limits into its operating procedures. PG&E FOF 1R A43. citing MFP Exh. 47 at 1. The Staff stresses that PG&E identified the problem through its surveillance program, took appropriate maintenance action, and is further studying the appropriate testing interval. It regards the incident not as a weakness but a strength of the ISI program. Staff FOF 111-109 through I-l11. 217

V P k in evaluating this incident, we find no basis for suggesting that the surveil-lance program was not properly implemented. The CCW heat exchanger tubes i were inspected when they were scheduled to be inspected. Indeed, there had L been no previous finding of fretting on inspection of the Unit I tubes. Tr,863-64 (Crockett). We express no opinion, however, as to whether the inspection interval was or is appropriate. The evidence of record does not suggest that more frequent surveillances are clearly necessary (or, for that matter, clearly not necessary). Finally, no safety system appears to have been compromised - the regularly scheduled testing is designed to detect this type of condition so it can be corrected before tube failure (MFP Exh. 47 at 6) and it did so here. PG&E is appropriately studying whether the frequency of testing should be increased. Given the existing schedular surveillance requirements, we find no undue delay - the condition was discovered 5 months before the hearing, with no indication that it had occurred earlier. In short, this incident does not reflect adversely on - PG&E's surveillance program. 9. Auxiliary Bulkling Ventilation System Inoperable On March 2,1993, maintenance personnel were preparing to perform a preventive maintenance task relating to the Unit 2 Auxiliary Building Ventilation System (ABVS), and a clearance was placed on the system. In subsequently revising th: clearance and implementing the work orden, however, personnel improperly closed the wrong damper, activating the ABVS logic to shut down - the only operable ABVS fan (the redundant fan was already out of service for maintenance). PG&E prepared an NCR and a LER concerning this reportable event. MFP Exhs. 49 (NCR DC2-93-MM-N012 Rev,00, dated June 11,1993) and 50 (LER 2-93-002-00, dated April 5,1993); Tr. 881-83 (Giffin). MFP claims that this incident demonstrates inadequate maintenance instruc-tions and poor communication between maintenance and operations staff, creat-ing an unacceptable safety risk (MFP FOF 1220). MFP designates the incident as one that disabled or threatened an essential safety system (outline 11.A), as indicative of insufficient communication between groups or departments (out-line IV.A), and as an example of inadequate or improper surveillance (outline IV.C). PG&E and the Staff regard this incident as an isolated personnel error with no safety significance. This latter conclusion is based primarily on the circumstances that limits set forth in 10 C.F.R. Part 50, Appendix A, General Design Criterion 19, would not be exceeded within the time (2 hours) needed to restore system operations, and that 24 hours is needed before any safety-related equipment would be affected (the ABVS was out of service for only 15 minutes). MFP Exh. 49 at 8. 218

iww V i We agree with MFP that the incident threatened a safety system, irrespective of the circumstance that it did not last long enough to have immediate safety significance. We also agree that the incident does to some degree represent an ' inadequacy in communications between maintenance personnel and others. It also reflects a personnel error, caused in part by insufficient instructions. We note that coficctive action to improve such instructions is being proposed. Given these factors, we do not consider the incident to have sufficient significance . io undermine the effectiveness of the maintenance program. Nevertheless, given the number of incidents reflecting inadequate communications between i maintenance personnel and other PG&E departments concerning maintenance-related activities, we are directing PG&E to perform a study of this problem and provide it to the Stalf. In addition, although not warranting a license condition, PG&E might also consider certain general improvements in the preparation of instructions to maintenance personnel. 10. Restoration of Electrical Panels MFP points to two incidents in 1993 (one in April, the other in May) involving failures to return electrical panels to their onginal configuration following work-relied activities within the panels.24 On April 1,1993, the rear hinged panel of the Unit 1 RHF panel was observed with no fasteners installed to secure the hinged panel to the main panel. The fasteners were in a plastic bag in the bottom of the RHF panel. ~!he preliminary safety evaluation wa, a potential loss of seismic qualification that could have impacted the operability of vital 4 kV bus F and its associated diesel generator during a seismic cient." A preliminary root cause was that responsibility for panel restoration was not assigned to any of the groups performing concurrent work on the panel. The NCR referred to several" previous similar events," one of which was a 1989 cvent to which MFP alluded. MFP Exh. 52 at I. 3,9. The second event was reportc j on June 7,1993, but occurred earlier (i.e., investigative followups were under way as early as a TRG meeting on May 25, 1993). Covers were found not to have been installed on the hot shutdown panel for both Units I and 2. The covers were observed to be lying in the bottom of the back of the panel, and the mounting screws "were no where [ sic] to be found." MFP Exh. 51 at I,.:, /, The specified root cause was merely a cross-reference to the other NCR and, thus, must be considered by us to be identical. 2NflP t.nha. $l and 52. Tr 888-90 (Giffin) Itetause of the smulanty of the ancidenis im PG&l"s view). the Apphcant n canulhng Enh. 51 and taking action under Lah $2. Nonetheless, two separate incidents diJ occur, and the cancellatum of one of the NCRs reprewnts enft a bookkeepmg convemence for PGAE. not a lowenng of the sigmftcance of either meident for of both considercJ collectively) 219 i l i

p Immediate corrective actions included (for the first event) replacing the fasteners the. same day they were discovered uninstalled and checking fasteners in similar panels and (for the second event) reinstallation of the internal hot shutdown panels.. Rrther investigative actions were undertaken but not yet complete at the time of the hearing. MFP Exhs. 51 and 52; Tr. 898 (Giffin). MFP asserts that PG&E's previous corrective action failed to prevent recur-rence of a similar event and that PG&E's safety analysis shows a misunder-standing of or disregard for the safety principles underlying its tnaintenance responsibilities. MFP FOF 11 227, 231. MFP categorizes these.acidents as involving safety systems being disabled or threatened (outline 11.A), inadequate or incorrect analyses of safety significance (outline I.B) and previous correc-tive action failing to prevent recurrence (outline 111.B), and as an example of insufficient coordination between multiple groups (outline 1IV.A). PG&E determined that both incidents had no safety significance - the first, because the bus and associated diesel would in any event have been operabic before and after a postulated seismic event, and because of redundancy, and the second because the as-found condition did not impact safety given other fire-protection features of the plant. PG&E FOF 1M-A61 and M-A62, citing MFP Exhs. 51 and 52. PG&E acknowledges that corrective action is still ongoing. Tr. 898 (Giffin). The Staff asserts that the incidents do not rise to the level of a fundamental flaw in the maintenance program and, in addition, would discount MFP's findings in this regard as speculative and not supported by expert testimony. 'Ihe Staff also observes that PG&E's root-eause analysis and corrective actions are angoing. Staff FOF t11-119 through I-121. In our opinion, there is no basis for concluding that a safety system was disabled or threatened, even though the practice of failing to restore equipment being serviced to use could analytically be deemed significant. Further, this is not an example of an inadequate or incorrect analysis of safety significance - the analysis is 6till under way, and no evidence suggests that final resolution has been unduly delayed. Finally, the 1989 and 1993 incidents are too disparate in time for us to conclude that the 1993 incidents resulted from a failure in the 1989 corrective action. We agree with MFP, however, that the incidents are examples of insufficient coordination between multiple groups. This deficiency has appeared in several other cited incidents. Although not sufficient to undermine the adequac)..f the maintenance system, this is an area calling for additional corrective action. We are encouraged that PG&E is studying this problem, but we nonetheless ar-directing that this general area be included as part of PG&E's communications study that we are directing, with a report to be furnished to the Staff. 220 j

7 9 t ,{ 11, ' Containment Equipment Hatch On March 12,1993, thb Unit 2 equipment hatch was observed to be not fully. closed, during a core offload, thus' violating a technical specification. PG&E. submitted an LER to the Staff, as required. MFP Exh.- 54 (LER 2-93-003-00, dated April 5,1993). He Applicant also prepared an NCR recording the - event, its significance, and corrective action.' MFP Exh. 53 (NCR DC2-93-MM-N013 00, dated May 28,1993).- .MFP claims that, despite a previous event and an NRC information notice, the maintenance procedure and personnel preparation were not adequate for the hatch closure activity. MFP FOP 1238. MFP categorizes this incident as one where safety systems were threatened or disabled (outline 11.A), where previous corrective action failed to prevent recurrence (outline 11.B) and as an example > of personnel error resulting from inadequate procedures (outline 11V.E). De Applicant and Staff each regard the incident as an example of isolated personnel error not reflecting any systemic maintenance problem. PG&E FOF 1M-A66; j Staff FOF I-125. We agree with MFP that the incident had safety significance: the gap in - the cover could, during fuel movement, permit a gaseous release of radioactive material to the atmosphere if an assembly were dropped. Tr. 903 (Giffm). We also perceive the incident to represent, as claimed by the Applicant and Staffi an isolated personnel error. We disagree with MFFs characterization of the incidert as reflecting previous corrective action that 'ai!ed to prevent recurrence. Although a previous similar event.had occurred 10 years earlier (in 1983), the lapse of time is sufficient to assume that the two personnel errors are unrelated.. Finally, there is some ambiguity in the record as to whether the 1993 error resulted from inadequate procedures. PG&E states that "[t]he procedure was adequate, the journeyman did not follow it." Tr. 9N (Giffin). But PG&E is modifying the procedures to require independent inspections of the closure from both inside and outside the containment. Tr. 904-05 (Vosburg). This appears to us to represent an improvement to already adequate procedures and not a reason ' to fault the maintenance program. We note that we believe that it would be impossible to climinate all personnel - errors, as highly desirable as such a result might be.- We here find not that personnel can never commit errors with significant safety consequences, or that l PG&E did not commit such an error here, but only that there oppe e to be no l programmatic reason at DCPP for errors such as this to have occurred. We offer l no magic solution to this endemic problem. - i i k ' i 221 T i t )

y v b j i

12. Menunt Reactor Th\\p Caused b) Failure of a Fusefor the V,

Rod ControlSystem ^ i n3

As set forth in NCR DCl-91-EM-N046, dated June 10,1991 (MFP Exh. 56),

on April 24,1991, plant operators initiated a manual reactor trip to terminate an increase in reactor power, caused by a failure of the rod control system which rendered manual' control rod movement inoperable.' The immediate cause was failure of a fuse 'in the bus duct disconnect to the' rod control power supply ' cabinet. Investigation disclosed that twelve of fifteen fuses in similar locations e b were of the wrong type. All such fuses were to have been replaced with newer-i design fuses. PG&E had submitted an LER to report this event to the Staff. k . MFP Exh. 55 (LER l-91-008-00, dated May 23, 1991). MFP asserts that PG&E's previous corrective actions were ineffective and failed to prevent this event. MFP FOF 1245. It categorizes the event as one i where safety systems were disabled or threatened (outline 11.A), where previous corrective action failed to prevent occurrence (outline 111.B), and as a personnel crror due to failure to follow procedures (outline IV.D.) PG&E acknowledged that the failed fuse was of an old style with known [- - reliability problems that was to have been replaced in 1989. It also acknowledged 'a personnel error in that the wrong fuses had been replaced. Following the trip, PG&E took steps to replace all of the bus duct fuses for the Unit I rod drive-i control cabinets, as well as other corrective actions. It considers the matter j resolved, with no recurring maintenance problems indicaied. PG&E FOF 1M- =i A68, citmg MFP Exh. 56 at 1,4,7,10. He Staff essentially agrees, perceiving no matter generally relevant to PG&E's surveillance and maintenance program. Staff FOF 11-127. in our view, MFP is correct in its characterization of this event. The failed l fuse had safety significance, it was supposed to have been changed and was ( not, and, predictably, it failed. Indeed, the wrong fuse had been changed. j Although these errors were eventually corrected, the situation does constitute poor maintenance performance. - Nonetheless, adverse circumstances do not l appear to be recurring with sufficient frequency to disqualify the maintenance { program or suggest a readily apparent remedy. We thus merely observe that - continuous vigilance and attention to detail is a worthwhile goal that' management - should strive for in implementing its maintenance and surveillance program.

l

13. limitorque 2 FCV-37 Failed to Close During a routine surveillance procedure in January 1993, one Limitorque -

motor-operated valve (2.FCV-37) failed to close on demand from the control room. MFP E h 57 at 3-4. He cause of the failure was determined by PG&E to be a quad ring incorrectly installed during a 1990 maintenance overhaul of ~ -l i 222 -( -t I i s

the operator, caused by an installation procedure that did not give adequate guidance to the workman. Tr. 913-14 (Giffin); MFP Exh. 57. MFP would have us find that PG&E failed to perform adequate maintenance on two valves and did not identify the problem in a timely way. MFP FOF 1260. It categorizes the incident as a pattern of responding to maintenance problems in a lax manner (outline 111.A), as untimely detection and correction of aging effects (outline 1II.C), as demonstrating a pattern of creating undetectable failures through improper maintenance (outline 1IV.B), and as an example of inadequate procedures or work instru, tions (outline TIV.E). In contrast, PG&E and the Staff portray the incident as an example of the IST/ISI test program performing as intended. PG&E FOF 1M-A69; Staff FOF 11-128. They stress that PG&E, in developing its NCR, determined the root cause of the error and thereafter instituted corrective action, returning the component to service and revising the maintenance procedure to provide additional guidance. PG&E FOF 1M-A71. In addition, they note that the other [ "similar" incident referenced by MFP was not related to maintenance and had I a different root cause. We agree with PG&E's description of this incident as only a " single isolated event." /d. Both the problem and its resolution appear to be adequately covered by the NCR. This does not significantly detract from the adequacy of the maintenance program. We are somewhat concerned however, about the adequacy of work instructions, a problem that is repeated in several of the incidents before us. In our opinion, but only as a 3 tgestion because no Board order would be warranted here, PG&E should consider whether improved systemic procedures could generally improve the adequacy of work instructions. 14. Safety injection Emergency Core Cooling System (ECCS) Accumulator Tanks This incident concerns the discovery by PG&E ofindications of intergranular stress corrosion cracking (ISCC) in the Safety injection ECCS accumulator tanks in both Units 1 and 2. Relying on a 1993 Staff Inspection Report (MFP Exh. 59, IR 93-08), together with a voluntary LER and a report of PG&E's Onsite Safety Review Group (OSRG) (MFP Exhs 60 and 61), MFP claims that PG&E's response to NRC Information Notice 91-05 was untimely and inadequate, that PG&E is not certain about the nozzle material used, and that financial considerations influenced PG&E's decision to delete its corrective action to replace all possible nozzle devices and piping in Unit 2 during its 5th refueling outage (2RS). MFP FOF 1267,272, and 276. The LER relied on by MFP lists three instances in 1985 when ISCC in the Unit 2 accumulator nonles was detected, two instances in 1986 and one in 1991, also in Unit 2, where ISCC was detected, and one in 1992 where ISCC t 223

I / l was detected in Unit 1. MFP Exh. 60 (LER 2-87-023-01) at 4 (of LER). The record also reveals that all the defective nozzles were replaced but, because of cost considerations and schedule impact, PG&E elected not to replace all such nozzles. MFP Exh. 61 at 2. MFP characterizes the deficiencies as disabling or threatening safety systems (outline 11.A), as representing untimely corrective action (outline 111.A), as examples of previous corrective action that failed to prevent recurrence and of untimely detection and correction of aF ng effects (outline 111.B, II.C), and i as an example of PG&E decisions regmiing what is needed to maintain the plant in a safe condition being unduly influenced by financial considerations (outline 11V.G). For their parts, PG&E and the Staff portray the incidents as a maintenance program performing as it should -in PG&E's terms, "an operating experience that was thoroughly addressed by PG&E." PG&E FOF M-A72. See also Staff FOF 111-132 through I-135. As stressed by the Staff and as reflected in the record, when small nozzle '.caks were first detected in 1985-87, PG&E identified and successfully repaired or replaced all leaking nozzles. The frequency of surveillance inspections was also increased. PG&E further cut out several nozzles for metallurgical analysis. Analysis demonstrated that crack propagation was from the inside and thus not from exterior corrosion. Staff FOF 11-133, citing MFP Exh. 60 at 3 and Tr. 934 (Crockett). Thereafter, following Staff issuance of Information Notice 91-05, concerning the possibility of ISCC in accumulator tanks PG&E performed funher inspections and discovered several other indict io n of cracking, which were repaired. With respect to this incident, we agree with the Applicant and Staff that the maintenance and surveillance program performed appropriately. As the Staff asserts, PG&E has been insestigating the issue since its initial identification and has implemented appropriate corrective maintenance and increased surveillance. It has committed to an enhanced periodic inspection program for accumulator nozzles. Staff FOF I-135 citing Tr. 939-41 (Crockett) and MFP Exh. 60 at

8. Although the m stter does have safety significance, as claimed by MFP, there is no evidence supporting the claims that PG&E was slow to initiate corrective action, that its attempted corrective action was unsuccessful, or that PG&E fails to know the composition of the nozzles.

Further, the financial claim (MFP FOF 1 276-278), based on assertions that PG&E elected to repair or replace defective nozzles rather than replace all of them (as it had considered doing) because of cost and the structure of California's rate system in dealing with maintenance costs, is not appropriate for us to consider at this point. No systemic compromise of safety standards has been uemonstrated, and there is no evidence that, because of California's rate 224

7= - system, PG&E is cutting corners on appropriate maintenance or surveillance activities.25 In short, we concur with the Staff assessment of the examination program for the accumulator tanks, "not only was it acceptable, it was considered very good work to be looking this hard and finding these things and fixing them." Tr. 2178 (Miller)..

15. Corrosion of ASW Annubar, DFn, and CO Piping 2

This issue concerns corrosion in three types of underground piping: the diesel fuel oil (DFO) line for Unit 2; fire protection carbon dioxide (cardox) piping in Unit 2; and ASW annubar piping (in the form of a 1 W-inch hole). Corrosion on the DFO piping was first observed in 1990; on the ASW annubar piping in June 1992; and on the cardox piping in January 1993. The corrosion on these three different pieces of equipment is related because of the similar location of the pipes - all of them are h>cated below ground in a concrete trench on the west end or sea side of the turbine building. After each discovery, PG&E initiated corrective action. MFP Exhs. 62, 63, 64, 64A; PG&E Test. at 99 (Crockett); Tr.1059 (Crockett). MFP claims that corrective actions taken after discovery of corrosion in the DFO piping in 1990 were ineffective and failed to prevent further degradation; that PG&E's maintenance and surveillance program was not adequate to detect and sufficiently control the extensive corrosion that I as occurred in the pipe trench /pipeway; that there was inadequate initial application and maintenance of the coal tar protective coating that was intended to prevent corrosion on the piping in the trench /pipeway; that the trench /pipeway was not maintained in an adequate manner to prevent the accumulation of water; that PG&E has been unacceptably slow to respond with corrective actions to alleviate the corrosion of pipes in the pipe trench /pipeway; and that PG&E's proposed corrective actions are unsubstantiated and should not be considered in this process. MFP goes on to assert that PG&E determined that the DFO and ASW an-nubar piping remained operable despite the corrosion; that PG&E instituted compensatory measures to compensate for the inoperable cardex system; and that PG&E's operability / compensatory determination, however, is not an in-dication of an effective mainten re and surveillance program but rather an indication that PG&E was lucky this time. Further, MFP asserts that PG&E's failure to prevent the accumulation of water in the trench /pipeway contributed + 25 We aho note th.at PG&E testihed that "We don't put off required maintenance This was evaluated, it was delernwned that we didn't have to do Itus Ifull replacement) ai that une and we didn't . anstead of gmng with a plan that would automalwally Just replace all the nortles we had preparations to mspect.. all of the tmules, and replace them af necenwy " Tr 940 (Giffin Crocketo. 225

p .i to the development of corrosion on the various pipes and is similar to its fail-ure to maintain sump pumps in the vaults; and the submergence of the cables contributed to the severe degradation and eventual failure of the 12 kV cables (see item 3, above). Finally, MFP portrays these developments as an example of inadequate coordination between maintenance and operations personnel. MFP categorizes these claims and assertiacs concerning underground corro- . sion of piping as disabling or threatening safety systems (outline 11.A), as an example of responding to maintenance problems in a tax and untimely manner (outline 111.A), as an example where previous corrective action failed to pre-vent recurrence (outline 1II.B) and of untimely detection and correction of aging effects (outline 111.C), and as an example of deficient communication and co-ordination between different groups of individuals and/or departments (outline 11V.A). Finally, the corrosion is attributed to inadequate procedures or work instructions (outline IV.E). PG&E characterizes these incidents as " operational experience with equip- . ment that is well within the scope of PG&E's maintenance and surveillance capabilities." It goes on to observe that the maintenance and surveillance pro-gram " functioned to find deteriorating piping and then to replace the piping with upgraded design, materials or construction techniques." PG&E FOF M-A76. It acknowledges, however, that its 1990 corrective actions with respect to the DFO piping corrosion may not have been adequate. "If we had done more then, .. we may have been able to do something to alleviate the situation." Tr. 1070 (Giffin)? The Staff stressed that the 1990 actions scre "not sufficiently comprehensive or conservative to prevent recurrence" but added that, "while further actions arguably could have been taken in 1990, in the vast majority of cases in which a problem has been identified. PG&E has taken prompt action commensurate with safety significance." Staff FOF I-145, citing Staff Test., ff. Tr. 2159, at 13. Discovery of the DFO corrosion in 1990 arose from normal surveillance. As corrective action PG&E repaired the pipe coating and increased the frequency of surveillance. Later inspections, however, revealed further corrosion in the DFO lines as well as the other piping. Eventually, PG&E instituted a corrosion task. force, comprising a multidisciplined organization from engineering to review the material condition throughout the plant of any piping that may be susceptible to corros.on. Tr.1062 (Crockett). PG&E is also looking at the design of the trench in which all three types of pipes were located and is changing the location of the DFO piping in the trench to minimize its exposure to standing water. The cardox piping is being removed from the trench completely and routed within the turbine building. Tr.1084 (Giffin, Vosburg).

• • See alw MI P 1.sh MA al I.3 ("the prevmus correctne actnms were meffective." at h 226 1

) l

We here find no fault with the surveillance program - it discovered the problems and none of the pipes were ever inoperable (although conservatively some of the ASW piping was declared inoperable pending further review). Tr. 1085-86 (Vosburg). ' The maintenance program for repairing the DFO pipe in 1990 fell short but now appears to be addressing the corrosion problem adequately - i.e., the broad-based task force, which is studying the " big picture" l

(Tr.1088 (Crockett)), appears ta be an acceptable approach to the overall

- problem. Improvements in surveillance procedures have also been implemented, to facilitate discovery of corrosion in underground piping. Tr. 1076-77 (Giffin). Thus, we agree with MFP that the corrosion has safety significance and that PG&E's initial corrective action (fer the DFO piping) fell short. We also agree that communications between various departments could have been improved. But the current program appears to be following a technically acceptable approach and is likely to represent a permissible means for developing an appropriate program for dealing with underground pipe corrosion for the extended terms of operation. Upgraded surveillance procedures have already i been instituted, and one type of piping is being moved to another location. In short, we will not disqualify the maintenance program for past shortcomings that appear to have been recognized and, in our view as well as that of the Applicant and Staff, corrected. We are, however, including this incident as one of those that requires PG&E to perform a study, to be provided the Staff, concerning upgrading of interdepartmental communications for maintenance-related activities. 16. Control of Measuring and Test Equipment (M&TE) l Technical specifications for the DCPP provide that there be appropriate procedures to ensure that tools. Fauges, and other measuring and testing devices be properly controlled, calibrated, and adjusted at specified periods to maintain accuracy. MFP Exh. 66, Enclosure I, at 1. PG&E has established such = procedures. In a February 1991 inspection, the Staff found both deficiencies in the M&TE programs and that PG&E had previously identified deficiencies but had I not aggressively corrected them. MFP Exh. 69; PG&E Test. at 102 (Giffin). ~Ihese deficiencies resulted in a sinpe (non-escalated) NRC enforcement action (Severity Level IV violation). MFP Exh. 71, MFP asserts that the identified M&TE problems are longstanding, recurring, and continuing, that PG&E's maintenance and surveillance organization failed to respond promptly to the deficiencies, that corrective actions taken by PG&E were ineffective to prevent recurrence, that PG&E management was insufficiently involved in the resolution of the M&TE deficiencies, and that the recurring deficiencies have safety significance. MFP FOF 1 318, 323, 329, 338, 345. 227 I Y

p b MFP categorizes the activities as disabling or threatening safety systems (outline 11.A), as indicating a pattern of responding to maintenance problems in a tax f-and untimely manner (outline 1II.A), as previous corrective action that failed to prevent recurrence (outline 111.B) and as insufficient management involvement (outline 1IV.A), and of personnel error due to inattention to detail and to failure to follow procedures (outline SIV.D). PG&E acknowledges the previous enforcement action and the failure of cer-tain of the corrective actions previously taken. But it maintains that it has taken further corrective action, as to which MFP has not indicated any deficiencies. It suggests that current deficiencies are minor paperwork discrepancies that must be differentiated from the earlier, more serious problems. The Staff similarly believes that the ongoing corrective actions will be effective. He current NRC Staff senior resident inspector testified that she is satisfied with the current M&TE program based on her own in-depth inspections. Tr. 2192-94 (Miller). It seems clear that, in the past, there were both problems with the M&'IE program and with maintenance activities designed to alleviate those problems. He record also establishes that the ongoing program appears to be working satisfactorily. That being so, it cannot conclusively be asserted that it casts doubt on the current or future maintenance program. Indeed, it may perhaps be validly claimed that the Staff's enforcement action is producing its intended result. In any event, the evidence of record concerning M&TE problems fails to establish significant weaknesses in PG&E's current maintenance program.

17. Centnfugal Charging Pump 21; Degraded Coupling On June 30, 1992, an increase in vibration on centrifugal charging pump (CCP) 2-1 was identified by PG&E Predictive Maintenance (PM) personnel.

Investigation into the cause included taking a gear lube sample from the motor-to-speed increaser coupling. During the sampling process, the coupling sleeve on the speed increaser side of the pump was found to be stiff due to hardened lubricant. The sleeve was subsequently freed and a work order was issued to replace the coupling prior to any failure of the equipment. The maintenance organization initiated an NCR on July 1,1992. MFP Exh. 73. The Technical Review Group (TRG) for this NCR concluded that the root cause of the problem was inadequate motor alignment criteria stemmi..g from ambiguous vendor information. Contributing causes related to inadequate lubrication were also identified. His was the third occurrence involving vibration of CCP 2-1. (However the NCR reviewed only one previous incident involving excessive coupling wear that occurred in 1989.) he cause of excessive coupling wear in the 1989 incident was misalignment of the motor with respect to the speed increaser. The role of inaccurate vendor information as 228

p: t a root cause was not recognized in the analysis of the 1989 event. Tr. 1120 24 (Ortore). De TRG met five times in the year following the issuance of the NCR. He g Group addressed such matters as corrective actions, investigative actions, actions - to prevent recurrence, and additional prudent actions. The TRG also considered - previous similar events and operating experience at other plants. Closure of the NCR was achieved on July 7,1993. De foregoing facts are not in dispute and the parties differ only as to the inference about the predictive inaintenance program that should be drawn from this incident. MFP urges the Board to find that the maintenance program is deficient because previous corrective actions should have prevented recurrence of this event, but failed to do so (outline III.B) because the program includes deficient procedures or work instructions (outline IV.E) and because the program for detecting manufacturing deficiencies or internal defects did so only by chance and should have identified the deficiencies before they became self-evident (outline 11V.F). MFP FOF 11350-353. PG&E and the Staff argue that this incident is evidence of the effectiveness of the company's predictive maintenance program because the degraded condition of the coupling was found i. before any pump failure occurred. Tr. I120-21 (Giffin; Ortore); PG&E FOF M-A88-89; PG&E Reply FOF 1R-A63-M; Staff FOF I-154 through I-156. The Board concludes that the degraded condition of the coupling was found and repaired before any equipment failure occurreo ar.d t, at the inspection was conducted as part of the company's systematic preventive maintenance program (PG&E Test. at 38-40 (Ortore); Tr.1121 (Ortore)), which we further conclude functioned effectively in this instance. We base our conclusion not only on the circumstances of detection and correction of the degraded condition but also on the systematic efforts of the Technical Review Group (TRG) to investigate the incident, find root causes, and develop remedies that could prevent future occurrences. MFP Exh. 73 at 9. ne TRG investigation revealed that similar degradation had occurred in 1989 on the same pump and that corrective actions for that event had not prevented recurrence. In both cases the root causes were attributed to inadequate alignment criteria; however, in the earlier case it was not recoFnized that inadequate vendor information contributed to the problem. We have no record basis that might show that the 1989 analysis was lacking in dili ence or that it resulted from f some weakness in th: PG&E maintenance program. The self-critical disclosure of the 1989 results indicates strength in the program because it contributed to a deeper analysis of root causes in the later analysis. The discovery and correction of the latest pump problem together with the analyses made by the TRG over a period of nearly 1 year to identify root causes and preventative measures appear to the Board to have been both reasonable 229

g u-- , x t 4 i 7 i h i no; ' and effective. We rely on the NCR itself for this conclusion s nce t ere s ..r evidence of record to support a finding of weakness in the maintenance program. MFP's assertion (IDF 11350-351) that the company should have done better-( based on prior experience is therefore unsupported and we reject it. We find that j h PG&E's detection, correction, and technical analysis of the degraded coupling on

the centrifugal charging pump is substantial evidence of a properly functioning ~

l maintenance program at the plant.

18. Unit Shutdown Due to inoperaMe High Pressure Turbine Stop Valve l

Circumstances related to the failed turbine stop valve are set forth in LER 2-i ( 92-003-01 (MFP Exh. 74). MFP relics on the LER and testimony of PG&E - f There is no witnesses to support its allegation. of improper maintenance. j controversy among the parties regarding the facts of the valve failure, however. difications, MFP FOF 11354, 355, and . Accordingly, we adopt, with minor tao 356 in the following paragraph as an accurate factual summary of the event. b a manual shutdown was commenced for Unit 2 when K On March 22,1992, PG&E determined that one high-pressure turbine stop valve (FCV-144) was 1 inoperable. FCV-144 is a hydraulically actuated swing check valve that protects i the high-pressure turbine from overspeed. PG&E disassembled FCV-144 and determined that "the nut that retains the valve disc to the valve swing arm had - disengaged from the disc stem, allo ving the valve dis: to become separated from the valve swing arm.".When the valve separated from the swing arm it caused a partial blockaFe of steam iiow through the Main Steam Lead. PG&E. l has been unable to identify the root cause of this equipment failure. It postulates - (1) unscrewing of the nut off the stem; or (2) a failure .f two modes of failure: of the nut / disc sterr threaded joint. MFP FOF 11354-356. L MFP requests the Board to find that *PG&E may have caused an undetectable failure through improper maintenance. PG&E responded that the immediate cause of the inoperable valve was equipment failure, and that neither the LER [ nor the testimony of record attnbutes this problem to a maintenance deficiency. i MFP Exh. 74: Tr.1126-27 (Vosburg). The NRC Staff sees no programmatic. in our view, the record does not support MFP's behef that the valve failure.~ deficiency. NRC Staff F0F 11-159. was caused by a maintenance deficiency. The root-cause analysic points either to unscrewing of the nut off the stem holding the disc, or to stripping of the threaded .l joint possibly due to buffeting of the disc in the steam flow. MFP Exh. 74 at - 3; Tr.~ 1133-34 (Giffin). Moreovo, no " undetectable failure" occurred.: P 1 The I MV'P hu not made clear how a mmmenance program could be improved to pernus the Jetection of "undetestab! 27 I failures " l 230 l i I h .] i J )

p' yg b L valve failure was detected by a rapid load reduction in power of approximately 10% Rus the valve failure was self-disclosing. De root causes of failure are likely traceable to manufacture or original installation of the valve. Tr. 1133-34 (Giffin). Prior maintenance and inspection of the valve, however, did not disclose any abnormalities that might have warned of potential failure. Had degraded conditions stemming from either possible root cause been present on inspections prior to the failure, they could have (and should have) been detected. Although the valve was manufactured and set up by Westinghouse, which performed at lust one prior inspection during an outage, degraded conditions were not discovered prior to failure. Tr. 1131-32; 1134-36 (Giffin). He record does not disclose whether degraded conditions were present but not observed on initial installation or on a prior inspection or whether they developed during subsequent operation. However, PG&E has now established enhanced inspection programs specifically to detect possible failures stemming from either of the root causes that have been identified from this event. Tr. 1134-35 (Giffin). There are eight such valves in the two units at Diablo Canyon. The failure described herein is the first of its kind in the life of the plant. Inspection of the seven valves that did not fait did not disclose any abnormal conditions. Tr. 1128-29 (Vosburg). De Board concludes that this failure was isolated and that no adverse inference about the PG&E maintenance program can be drawn from it. fbr all of the foregoing reasons, we reject MFP's asss mon (outline 1IV.B) that this failure supports a general conclusion that maintenance activities may cause undetectable failures and future safety problems. We also reject MFP's IV.F) that PG&E enerally lacks an effective program for i assertion (outline F detecting manufacturinF deficiencies or internal defects for the san e reasons. MFP FOF 147-48, 57-59. 19. Diesel Generator 2-2 Failure to Achiere Rated Voltage On December 29, 1992, diesel generator (DG) 2-2 was subject to a post-maintenance test. The DG started but did not load because the generator did not achieve rated voltage. MFP Exh. 75 at 1; MFP Exh. 76 at 1; Staff FOF 1-160. PG&E determined that the failure to load occurred because all four generator slip ring brushes were out of position after maintenance had been performed. PG&E found that the mispositioning occurred inadvertently when a mechanical maintenance worker loosened some mounting bolts to conduct an inspection of the generator shaft, rotated the shaft manually, and then retightened the bolts without inspection of the position of the brushes. MFP Exhs. 75,76; Tr.1139-40 (Giffin). He immediate cause for this event was personnel error. Tr.1139-40 (Giffin). The root cause was inadequate electrical information 231 i i

being supplied to the mechanical technician. MFP Exhs. 75,76; Tr.1141-43 (Giffin). Corrective action was taken to revise the maintenance manual for the DGs to advise technicians on how to prevent recurrence of the error. When the generators are involved in maintenance, procedures will also be revised to involve electrical technicians. Tr.1144 (Giffin). MFP requests the Board to find the maintenance program defective because the error outlined herein demonstrates inadequate procedures and a lack of communication or supervision among electrical and mechanical maintenance personnel. MFP F0F 11362-368. The Appiicant asserts that this incident is an example of how a maintenance program should work and that MFP's conclusion that the program is globally defective because procedures had to be improved is unwarranted. PG&E FOF M-A94. The Staff sees no programmatic defect because, even though the error occurred, it was found by surveillance and PG&E took corrective actions. Staff FOF 111-162,1-163,1-164. Errors in maintenance and communication occurred as asserted by MFP; however, its exhibits and PG&E testimony show that PG&E's surveillance was effective, that it analyzed the problem, and that it took corrective action which appears reasonable and effective. MFP Exhs. 75,76; Tr. I142-44 (Giffin). MFP has not controverted this aspect of the exhibits and testimony. Because the errors found here have been effectively analyzed and corrected. this incident cannot serve as cumulative evidence in support of MFP's assenion (outline 111.A. IV.B. and IV.E) of eneral deficiency in the surveillance and maintenance program. F The Applicant has carried its burden of proof with rest ei to the diesel incident.

20. Missed Alert Frequency STPfor Auxiliary Saltwater Pump 1-2 and Component Cooling Water Valve CCWa-RCV-16 MFP introduced three exhibits that addressed two separate incidents of personnel error and missed surveillance tests; one on a component cooling water (CCW) valve and the others on an auxiliary saltwater (ASW) pump. MFP Exh. 77 (NCR DC2-93-TS-N005 Rev. 00); MFP Exh. 78 (NCR DCl-92-TP-NOS2 Rev. 00); MFP Exh. 79 (LER l-92-024-00). There is no di<pute that the required surveillance tests were missed and that personnel error,

wsponsible. Missed surveillance tests are the only common factors in the othcrwisc unrelated incidents involving the valve and pump. The Board is called upor 'o decide whether the missed surveillance tests are indicative of a general deficiency in the PG&E maintenance and surveillance program, as claimed by MFP (outline 11.A 111, IV.C, IV.D), or are simply examples of isolated personnel errors that do not suggest a pervasive programmatic breakdown, as claimed by PG&E and the NRC Staff (PG&E FOF 1M-A99; Staff FOF 11-167,1-168). 232 i i J 1

gr 3 Details of the missed surveillance tests and other error are given in MFP Exhs. 77,78, and 79. Here being no factual dispute, only a brief summary of the incidents need be set forth here:- - Incident 1. In the first incident, the CCW valve was stroke tested in October 1992 and, based on results, was placed on alert that required the test frequency _ to be changed from once every 92 days to once every 31 days. ne new test frequency was lost from the plant computer system at the time of entry because of personnel error, so the next test was performed on the regular 92-day schedule rather than the 31-day schedule. The required surveillance test was missed twice in the interim. The error was discovered during the 92-day surveillance. PG&E ' FOF 1M A96; Staff FOF 11-165; MFP FOF T 375-377. Incident 2. This incident involved two instances of personnel errors during surveillance testing of an ASW pump. In the surveillance test of August 21, 1991, the reviewer used an incorrect pump curve to determine the required differential pressure and failed to recognize that the ASW pump should have been declared inoperable. His was later found to be a reponable violation of applicable technical specifications. In the surveillance test of the same pump on November 14, 1991, the reviewer wrongly determined that the differential pressure test was satisfactory when it actually was within the alert range. He pump should have been placed on alert which would have required surveillance on a 46-day testing frequency. De test was missed on January 29,1992, and PG&E was, on that date, in violation of applicable technical specifications. The error was disccvered on October 15, 1992, during reCes of a similar test that had been performed on October 7,1992. MFP Exhs. 78,79; PG&E FOF 11M-A97, M-A98; Staff FOF 1 1-165,1-166; MFP FOF t 369-370, 372-373. MFP requests the Board to find that these examples of personnel error con-stitute cumulative evidence in support of their broad assertions of programmatic deficiency in the Diablo Canyon maintenance and surveillance program (outline $11.A.111, IV.B. D). Although the personnel errors occurred as described by MFP, the Board rejects MH"s view that the errors are contributing evidence to an inference of programmatic breakdown. The view expressed by MFP is contrary to un-controverted direct testimony of the Applicant. In each case, the testimony describes both preventative and corrective actions within the maintenance pro-gram. PG&E's direct testimony eMorates at length on that portion of the PG&E program that provides for root-cause analysis, failure trending, and correction of equipment and personnel failures. PG&E Test, at 58-62 (Giffin). De Board finds that systematic provision in a maintenance program for the analysis and correction of degraded conditions is an inteFral part of the overall program and must be considered in determining the quality of the program. Each of MFP Exhs. 77,78, and 79 contains analyses not only of the circum-stances of equipment and personnel failure but also of the root-cause analyses 233

and corrective actions that were recemmended by the respective technical review F Froups. None of the conective actions were explored or controverted by MFP on cross-examination. The Board finds from its own inspection of the exhibits that the analyses and recommended corrective actions in each case appear to be reasonable. Hey are indicators of a properly functioning program. Here is no support anywhere for MFP's apparent belief that the worth of the overall maintenance program can be determined by counting unrelated equipment or personnel failures. There is no objective standard for. such determinations and MFP ignores the integral role of root-cause analyses and ' conective actions in such programs. If these actions are effective, we cannot ~ say that the program itself is generally defective even though equipment and personnel failures occur. We find that the examples of failure cited in MFP Exhs. 77,78, and 79 do not constitute contributing evidence that PG&E's maintenance program is generally defective.

21. In-Service Prompt Test Data Questionable MFP offered Exhibits 81 and 82 as examples of errors in a surveillance test procedure (STP). MFP Exh. 81 (NCR DCO-92/IN-N055 Rev. 00,3/1/93);

MFP Exh. 82 (PG&E Letter No. DCL-92-262, i1/25/92). The STP contained a diagram showing an erroneous location for taking vibration measurements on Auxiliary Feedwater Pumps (AITV). The diagram showed an arrow wrongly pointing to the pump housing instead of the correct locath a on the pump bearing caps. A PG&E engineer discovered and corrected the error in the diagram after several months but did not initiate an Action Request (AR) to track the matter and to ensure that tests conducted while the diagram error was in place were donc correctly. NRC issued a Severity Level IV NOV for failure to issue an AR 6 which was required by procedure. PG&E agreed with the violation. There is no dispute that the erroneous diagram existed and was used in many inspections before the error was found and corrected. There is no evidence that incorrect data were taken because of the diagram. Tr.1154-57,1159 (Crockett). Esen if measurements had been taken from the pump housing instead of the pump bearing cap, abnormal vibration would have been detected. MFP Exh. 81 at 7. We adopt the factual description of the NRC Staff as an accurate summary of events leading to the NOV. Staff F0F 9 l-169, I.170,1-171. MFP calls upon the Board to find that this incident indicates a weakness in PG&E's surveillance testing program (outime, $1111, IV.C). MFP FOF 1387-389; 42 (failed checks and balances or multiple barriers); 49-50 (repetitive pattern of inadequate surveillance). The Applicant and NRC Staff see the error i as minor, in the nature of a typographical error. PG&E FOF M-A101. M-A102: Staff FOF 11-172. 234 i 1 4

p The' Board findi that this minor incident had virtually no safety significance and does not support an adverse inference on the overall quality or effectiveness of the surveillance program. The Diablo Canyon maintenance and surveillance program is premised on the need for both preventive maintenance (including surveillance) and corrective maintenance. Corrective activity is an integral part of the program because preventive maintenance (and surveillance) cannot avoid all corrective maintenance. PG&E Test. at 11-14 (Crockett, Giffin); at 38-42 (Ortore, Giffin, Vosburg). MFP's own exhibits show that, even for the minor enor described here, PG&E undertook a substantial corrective effort that included internal review of its procedures leading to the discovery of the diagram error and review by a technical review group that analyzed the event, identified the root cause, and considered whether dots painted on equipment to guide vibration measurements should be programmatically controlled.2s The corrective actions appear reason-able; there is no contrary evidence. The Board concludes that this event does not contribute to an inference of programmatic deficiency in PG&E's maintenance and surveillance program. 22. Hold-Down Motor Bolts on Centnfugal Charging Pumps MFP Exh. 83 is a PG&E NCR that reports several discrepancies in Centrifu-gal Charging Pump (CCP) 2-1 hold-down motor bolts found by PG&E during preventive traintenance in July 1992. Further hvcstiga tion by PG&E subse-quently revealed hold-down bolt discrepancies on other CCPs as well. The discrepancies were attributed to flaws in the original procurement specifications and vendor-supplied information during plant construction in the 1970s. Some of the conditions now reFarded as discrepant such as machined hold-down bolts, elongated bolt holes and stacked washers were done for motor alignment pur-poses and were accepted field practice during plant construction. MFP Exh. 83 at 15; Tr. I161-62 (Giffin). MFP requests the Board to find that PG&E's maintenance program is defective because it failed to identify the hold-down bolt discrepancies'in a timely manner and it has given inadequate attention to identification of discrepancies related to initial installation. MFP F0F 1393-401. It claims that this issue contributes to a shos,ig that most of PG&E's past maintenance problems have threatened or disabled essential safety systems (outline I.A). MFP FOF 1125-27. 28 MI P urges adopuon of Ior 1.45. allegmg that guide does nus mg from equipners are un additmnal indicator of pruFram weakness We reject this wcw because the dots were acither regulatory nor plant requirenrntr. and served only as mformal aids to techrucians They had no adery nigmficance 235

r-I PG&E argues that MFP's exhibit shows the preventive maintenance program working as it should in finding manufacturing discrepancies that had existed since original procurement. No defect in the maintenance program is shown by this occurrence. The Staff agrees that it does not show any defect in the maintenance program. Neit er does it show any current problem in procurement h I which is, in any event, outside the scope of the admitted contention according to both the Applicant and the Staff. PG&E FOF 1M-A103: Staff FOF 111-173 through I-176. De Board finds that this occurrence had no public health and safety effects and does not support MFP FOF 25-27, which allege a Feneral deficiency in maintenance of safety systems. We also find that any flaws existing in the original procurement program are outside the scope of Contention I and need not be considered further. MFP's concern for timely discovery of flaws in hold-down bolts is supported by its exhibit which shows that PG&E had not implemented a Westinghouse technical bulletin and thus did not find the problem earlier. MFP Exh. 83 at

5. We adopt MFP's FOF 1393-396 which assert that the problem could have been found earlier.

Ec truth of MFP's proposed findings applies to this particular incident but does not assist it in proving programmatic deficiency in PG&E's maintenance program. We know of the missed opponunity to discover the problem earlier from the self-critical analysis of the PG&E Technical Review Group. Self-critical analysis is an indicator of integrity in the u.ogram. The scope of TRG investigation included consideration of similar probierns on other components and the formation of a hold-down bolt " hit team" to track corrective actions and - ensure completion ofinspections of all components identified as a result of this TRG. MFP Exh. 83 at 8,9. %c analyses and corrective actions of the TRG appear reasonable; there is no contrary evidence. We find that root-cause analysis and broadly based corrective action are indicators of strength in the maintenance program. The deficiencies described herein could have been discovered earlier; however, that has no implication for the safety of future operations because the lessons from this occurrence were learned and incorporated into the maintenance program. The Board finds that MFP Exh. 83 demonstrates a now-properly-functioning maintenance program and is not now supportive of an adverse conclusion on that program.

23. Reactor Coolant System Leakage MFP Exhs. 84 and 85 are an NCR and LER, respectively, that describe an incident of excessive reactor coolant system (RCS) leakage that occurred at Diablo Canyon Unit 2 on August 13,1991. MFP Exh. 84 (DC2-91-MM-N069 D14, 2/2/93); MFP Exh 85 (LER 2-91-004-00,9/16/91). Bere is no dispute 236

= I' [s among the parties that excessive RCS leak rates existed; that' the leakage was not promptly detected because of personnel error in calculation of leak rates; that the error resulted in a violation of a Technical Specification (reported to l NRC in the LER); and that the leakage occurred in the body-to-bonnet joint of check valves in the Chemical Volume Control System (CVCS). He valves had degraded studs from boric acid corrosion. The full description of this event is given in MFP Exhs. 84 and 85 and the Board adopts MFP F0F 11402-408 as uncontested findings of fact that summarize the foregoing occurrences. MFP asserts that PG&E failed to establish an effective surveillance program that would have prevented or detected the degradation and leakage despite prior industry communications on this subject. It asserts further that PG&E's corrective action is of questionable effectiveness, vague, indefinite, and lacking in commitment. MFP F0F 11409-420. It also claims that this incident is contributing evidence to a general conclusion of programmatic deficiency in the surveillance and maintenance program because safety systems were threatened; there was untimely detection and correction of aging effects; and there was generally inadequate surveillance and testing (outline 111.A, II.C IV.C). MFP FOF 126-27, 36-37,49-50. MFP filed no proposed findings on the personnel enor that led to failure to meet a Technical Specification as set forth in MFP Exh. 85, and we treat that issue as abandoned. PG&E asserts that its correctiw 'etions were effective and its existing surveillance procedures are adequate to detect leaktge. P.i&E FOF M-A109. The Staff asserts that this occurrence does not evidence a breakdown in the overall program. Staff FOF I-181. The Board f'mds that prior to this incident PG&E had effective procedures for detection of leaks from the RCS but did not have a preventive maintenance program for the inspection and retorquing of valve bolts or for inspection of gaskets or for the detection of boric acid corrosion on bolts. MFP Exh. 84 at 2-5, 9; Tr.1185-86 (Giffin, Vosburg). As a result of this incident PG&E inspected and maintained seventeen additional Unit 2 valves and developed additional corrective actions to replace nuts and studs showing corrosion and to retorque all nuts on valves. A " hit team" program was developed for replacing bolting on valves that have carbon steel (B7) bolts that are exposed to boric acid wi h stainless steel bolts. The t bolt replacement has been accomplished. This eliminated the problem of bolt corrosion from boric acid because stainless steel bolts are resistant to corrosion. Tr.1184 (Giffin). De Board rejects for lack of evidence MFP's assertions that the corrective actions adopted by PG&E are vague, indefinite, or lacking commitment. The corrective actions summarized above and set forth in detail in MFP Exh. 84 and in PG&E testimony appear to the Board to be clear and understandable. 237 i 1 )

.r. Contrary to MFP FOF 11418-420, we find it commendable rather than sinister that PG&E took " prudent actions" in addition to " corrective actions to prevent recurrence" as a result of this incident. Here is no evidence that " prudent actions" will not be implemented. Although MFP is correct in its assertion that PG&E had no preventive main-tenance program that would have directly pr: vented or detected degradation of bolts prior to the incident described herein, the Board rejects MFP's assertion of PG&E negligence (MFP FOF 11409-411). Industry and regulatory documents cited only by title in support of that assertion are not before us and, without Board knowledge of their contents, are not adequate evidence to support such a finding. We also reject MFP's assenion that no information exists on the condition of Unit i valves (MFP FOF 1412). Hey have been inspected for leakage. Tr.1182 (Giffin). Moreover, MFP's exhibit is an account of events that took place at Unit 2; it is neither alarming nor significant that it contains no information on the condition of valves in Unit 1. Dere is no basis for concluding that a preventive maimenance program targeting valve bolts and gaskets should have been in place earlier. Reasonable minds may well have decided initially that leak detection was adequate to protect the reactor from excessive loss of coolant, as proved to be the case here. Staff FOF I-180. MFP simply disagrees; however, the dispute is academic. PG&E has now adopted the additional inspection and maintennae procedures for retorquing of bolts and for detection and prevention of corrosion as advocated by MFP, These actions resulted in imprmeae its in the effectiveness of the maintenance and surveillance program. The Board does not find the prior program defective simply because it was later improved as a result of operating experience. The program improvements adopted by PG&E in this case contribute to a finding of reasonable assurance of safety in future operations. The Board rejects as unsupported MFP's assertion that this incident is evidence of a generally defective surveillance and maintenance program. 24. Reactor Carity Sump Wide-Range Level Channel 942A Inoperable ne issue of inoperable channel 942A requires the Board to decide whether the particular failures of equipment and personnel that occurred are also evi-dence supporting a general finding of programmatic deficiency 6 the PG&E surveillance and maintenance program. MFP Exhs. 86-89 describe events related to two occurrences of an inoperable i reactor cavity sump wide-range level channel. MFP Exhs. 86 (DC2-91-TI-NO96 DS); 87 (PG&E Letter No. DCL-92-090, 4/20/92); 88 (NRC Letter j to PG&E with NOV attached, 2/28/92); 89 (PG&E letter No. DCL-92-071, 3/30/92). These channels are instruments used to provide post-accident water-level data inside containment. The data are used to verify the occurrence of l i 238 i I i

a loss-of-coolant accident (LOCA). Two channels are required by Technical Specifications to be operational when the reactor is in one of several specified operational modes. MFP Exh. 89 at 1. The channels are not the only way of detecting a LOCA: other redundant means for doing so exist at DCPP. Tr. 1200-01 (Vosburg). The first equipment malfunctions occurred in 1990 when two channels became inoperable and were not detected by operators from August 21,1990, to November 6,1990. The f ailure to detect the malfunctions resulted in a violation - of a Technical Specification which wt, reported to NRC in an LER. The second incident began with a channel instrument malfunction on October 10,1991, that went undetected until October 22, 1991, when an NRC Inspector found it by reviewing the Safety Parameter Display System (SPDS). The failure to detect the malfunction for more than 7 days with the reactor in mode 2 (startup) or mode 3 (hot standby) was a violation of a Technical Specification and NRC issued a Severity Level IV NOV. PG&E acknowledged the violation in its response to the NOV. MFP FOF 11421,423,424; MFP Exh. 89 at 1. NRC's cover letter with the NOV was critical of PG&E for taking inadequate corrective actions in the 1990 event that failed to preclude the 1991 undetected failure. MFP Exh. 88. NRC's main concern was for inadequacy of the operator surveillance program that resulted in failure to detect equipment malfunction. NRC has only minor concern for the equipment failure itself, which it regards as a common occurrence. Tr. 2199 (Narbut). MFP requcsts the Board to find with respect to this vident that PG&E's corrective actions to train operators after the 1990 event were inadequate to prevent recurrence of undciccicd equipment failure. MFP FOF 1425-427,429-430,431-433. It also asseits that the SPDS system is not maintained adequately. Finally it argues that this issue is relevant to maintenance and surveillance even though the personnel failure that led to the NOV was by control room operators rather than maintenance personnel. MFP also asserts that this incident supports a conclusion of general deficiency in the PG&E surveillance and maintenance program because it is part of a more general pattern: it involved safety systems; PG&E's response was lax and untimely; the problem recurred; and surveillance was inadequate (outline t11.A, !!.A, II.B. IV.C). PG&E minimized the significance of the equipment and personnel failure because the incident is isolated and now resolved; it involved operator failure which does not reflect on PG&E's ability to maintain equipment; failed indica-tors are not uncommon; and the majority of its corrective actions are effective. De NRC Staff sees no general deficiency in the maintenance program because operator knowledge problems are not widespread and subsequent corrective ac-tions were effective. De Board finds that MFP's assertion of inadequate corrective action in 1990 that permitted recurrence of equipment malfunction and operator failure to detect 239

a malfunctioning channel in 1991 is true and uncontested in this case. No root cause was found for the equipment failures in 1990 or 1991, and correction was finally achieved by replacing the affected equipment and cables. Cause for the operators' failure was their reliance on a misleading chart record and their failure to understand indications of failed channels shown on the SPDS despite instructions issued in 1990. Tr.1191-96 (Vosburg, Crockett). liowever, corrective actions on equipment have been effective and there have been no channel failures since the 1991 incident. Tr. I199 (Crockett). Surveillance of the SPDS by control room personnel is r. v, adequate. The issue is closed. Tr. 2200-01 (Miller). Corrective action is an integral part of the surveillance and maintenance program. Even though equipment and personnel failures occurred, the program cannot be found generally deficient if corrective action was prompt and effective. The fact that correction took two tries in this case was not unreasonable under the circumstances. Resolution of the intermittent equipment problem was difficult but there was no evidence of laxness, lack of diligence, or lack of commitment in addressing it. Between the 1990 and 1991 incidents, four 942A channel failures occurred but none exceeded the 7-day technical-specification action statement. These failures did not go undetected and there is no evidence of prior warning of deficient surveillance by operators during that period. De issue is now closed and there is nothing left of it that undermines reasonable assurance of safe operation during the recapture period. The Board rejects for lack of esidence all of MFP' a n:rtions alleging that the SPDS system is unreliable. No record exists to support a conclusion about the reliability of the SPDS system. MFP cites unrelated equipment failures that do not support its proposed findings on the reliability of the SPDS. Contrary to MIYs claim, there is no regulatory requirement for the SPDS to be seismically qualified (Tr.1197 (Gif:in)). Allegations of unreliability in the SPDS are without merit. Contrary to MFP's claim, the failure of control room operators to perform adequate surveillance in this case has no general adverse implication for the adequacy of the surveillance and maintenance program which is the subject of the admitted contention. The Board concludes that the particular failures of equipment and personnel occurred as alleged by MFP but these failures do not support an inference of programmatic deficiency in the PG&E surveillance and maintenance program. 1 21 Design Criterion Memorandum (DCM) Requirements ne issue raised by MFP based on Exh. 90, MFP FOF 446,450, requires the Board to decide whether the teview of design documentation undertaken by PG&E shows a programmatic weakness in the surveillance and maintenance I

y program (outline 11V.C). MFP Exh. 90, DCO-93-TN-N006 Dl, February 12, 1993." PG&E conducted an audit (as part of an upgrade project) to determine the adherence of its maintenance program to its administrative requirements (Design Criterion Memorandum Category I (DCM)).- De purpose of the audit is to remove discrepancies between design documen's and the surveillance and maintenance program. PG&E regards this as an important purpose, as does NRC. ne upgrade program for category I devices was expected to be completed by the end of 1993. Tr.1204-09 (Croc; cit). In the course of the audit, PG&E encount: red a discrepancy wherein no test exists to provide verification of the emergency diesel generator fuel oil day. tank low-level switch transfer pump start signal actuation. MFP Exh. 90 at

2. Although the equipment discrepancy in this instance should be removed, the finding itself is of minor significance because, when the diesels start automatically, operators start the pumps manually and do not rely on the switch.

Tr.120344 (Crockett). MFP FOF 11448-449 appear to agree with PG&E as to the necessity for the design document review, the necessity for it to be completed, and the need to make changes that result from it. There is no controversy in those assertions in need of resolution inasmuch as PG&E testimony shows that that is its intent. We reject, for lack of evidence, MFP's assertion that the review should be extended to include " Class 2" equipment. There is no mention of that matter anywhere in the record and the Board has no basis to le.iue it. We also reject MFP's concern that there is uncertainty as to PG&E's commitments to NRC. No record was developed on that matter at the hearing, and NRC has not addressed it. The Board concludes that there is no evidence at all related to the DCM issue that contributes to a finding of general programmatic weakness in the surveillance and maintenance program. Critical self-assessment, voluntanly undertaken by PG&E, indicates program strength, not weakness. The Board rejects any possible implication by MFP that voluntary program improvement by PG&E, per se. supports an inference of prior program deficiency. MFP's assertions in the DCM issue are without merit and are rejected in their entirety. 26. Pipe Support Snubber Damage The issue raised by MFP based on Exhs. 91 and 92 calls upon the Board to decide whether an incident involving a damaged pipe support snubber is evidence of a generally deficient surveillance and maintenance program at DCPP. 8 5cc alw PG&E Lah 21 tDCo 9ATN-N% August 2A 199h. which is an urined version of Mi'P Exh. 90. 241 L I l ) 1 i

(: MFP Exh. 91 (NCR DCl-92-MM-N021. Rev. 00, February 12,1993); MFP Exh. 92 (PG&E Letter No. DCL-92-264). MFP claims that the snubber failure contributes to a conclusion of general programmatic deficiency because it shows that PG&E lacks a program to detect manufacturing deficiencies or internal defects and it thereby did not prevent the snubber failure (outline IV.F). MFP FOF 1157, 58, 59, 454, 455. PG&E claims that the failure is due to a manufacturing defect that does not implicate maintenance and that the defect could not be detected absent disassembly of the snubber. PG&E FOF M-124. The Staff agrees with PG&E. Staff F0F 11 196, PG&E found the damaged snubber during a system walkdown in May 1992. The snubber was locked and buckled. Root-cause analysis showed that the I failure was due to an out-of-tolerance condition on the interior stainless steel verge wheel combined with stress and chloride exposure from salt air at an outdoor location. He out-of-tolerance condition resulted from a manufacturing defect that led in turn io excessive stress in service. He wheel failed under excessive tensile stress due to stress corrosion cracking. PG&E tested and overhauled or replaced o:her snubbers similarly situated. MFP Exh. 91 at 3-4. MFP is correct in its claim that PG&E did not have a program in place that would have prevented this failure. However, MFP cites no regulatory requirement that would obligate PG&E to devise such a program, and we know of none. MFP Exh. 91 discusses the regulatory scheme governing snubbers. There is a Technical Specification requirement that all snubbt s be operable during specified plant operations with some exclusions for non-safety-related systems. Technical Specification 3.7.7.1 requires that when a snubber becomes inoperable it be replaced or restored to operable status within 72 hours from the time of discovery. He regulatory scheme therefore relies on corrective action and obligates PG&E to correct snubber failure within a specified time period. MFP Exh. 91 at 2. The PG&E corrective maintenance program is recognized with approval by NRC. Staff Test., ff. Tr. 2159, at 2 (Peterson), 5-7 (Narbut, Miller). Corrective maintenance is a normal part of the surveillance and maintenance program, i PG&E Test, at 38-41 (Ortore, Giffin). The program therefore cannot be found generally deficient solely because equipment failure was not prevented or because corrective action was necessary to restore failed equipment. FG&E has a program for the inspection and testing of snubbers. The program would not detect internal stresses on components or manufacturing defects before failure. There is no evidence that effective preventive maintenance could have been devised to present failure from manufacturing defects. Such a program would ] require disassembly of snubbers for the purpose of determining manufacturing tolerances of components. There is no assurance that component stress or corrosion would be present and visible when disassembly was undertaken. Tr. 242 j i i

y 1218 (Giffin). No expert has advocated that PG&E devise such a preventive maintenance program. MFP has not cited any deficient or inadequate corrective action taken by PG&E in this incident and we found none in our review of the record. We find that PG&E had no regulatory obligation to t.ndertake a preventive maintenance program for the purpose of preventing the snubber failure that occurred. There is no evidence that such a program would improve safety because the failure was a unique and isolated case. MFP Exh. 91 at 4. He Board finds that the snubber - failure has no adverse implications regarding the programmatic adequacy of the PG&E surveillance and maintenance program.

27. Gas Decay Tank Missed Surveillance ne issue of the missed gas decay tank surveillance is based on MFP Exhs.

95 and 96 and requires the Board to decide whether this incident is part of a pattern of missed surveillance tests that reflects a programmatic weakness in the surveillance testing program. MFP asserts that this incident is pan of a pattern that demonstrates a weakness in PG&E's surveillance testing program. His incident is said to be evidence of a general program deficiency because it is part of a pattern of disabled or threatened safety systems and part of a repetitive pattern of missed surveillances (outline 111.A IV.C). MFP FOF 125-27, 49-52, 461. PG&E asserts that this incident does not reflect a pervasive proble n anc does not represent a programma<ic breakdown. PG&E FOF TM-A128. The NRC Staff asser:s that this incident has nothing to do with the maintenance program at Diablo Canyon and that it does not represent a programmatic breakdown. Staff FOF l-201. In this incident, a 24-hour gas decay tank surveillance required by Technical Specifications (TS) was not performed within required time limits. The test was performed about 2 hours later than required. The late test counted as a missed surveillance and a TS violation that resulted in the preparation of an NCR and an LER submitted to the NRC. MFP Exhs. 95,96. The root cause of the missed surveillance was an inadequate instruction given 1 to the technician. The instruction said the test should be performed daily when it should have said the test was required by Technical Specifications to be performed every 24 hours. Contrih.dng to the error was the fact that the errant chemistry technician had forgotten the requirements although he had previously received 20 hours of instruction on them. MFP Exh. 95 at 5-6,13. When circumstances required that he defer the surveillance, he did so without regard to the expiration of the TS time requirement. Corrective actions included revising the instructions and counseling the technician.. The Board finds that root-cause determination and corrective action taken by PG&E were adequate as stated in MFP Exhs. 95 and 96 because there is j 243 l 1 i

/ ", ' b g a1 4 no contrary evidence and our own review revealed no deficiency.S Corrective.

action is an integral and necessary component of a surveillance and maintenance i

program. When performed adequately, corrective action provides reasonable.

assurance of safety in future operations with respect to the specific incident at issue. The fact that reliance'is placed on corrective rather than preventive action is not per se an indication of programmatic deficiency. It is the failure

. of corrective action that leads to. concerns for the adequacy of a program. Tr. 2202-03 (Miller). Dus, there is no regulatory requirement to prevent all j unwanted events even though MFP would have it so. Morcoser, where corrective ^ i action has been adequate and the incident is properly brought to a close, the ' . incident itself cannot logically be used as cumulative evidence of programmatic deficiency. For all of the foregoing reasons, the Board concludes that the incident. [ of the missed surveillance is not evidence of a general programmatic deficiency ; in the PG&E surveillance and maintenance program. r ' 28. Seismic Clips ht kstalled ' MFP Exh. 98 is an NCR that describes and analyzes events surrounding the 1 discovery on December 3.1992, that Unit I reactor trip and bypass breakers did not have seismic clips installed as required by plant procedures. The ' nonconformini; condition existed from the time of Unit I restart on November 3,1992 to December 3,1992, when it was corrected. MFP Exh. 98 at 2-5 (NCR OCl-92-OP-NC62, Rev. O, January 27,1993). MFP asserts that this event contributes to a conclusion of general programs matic deficiency in the surveillance and maintenance program because: -PG&E root-cause analysis identified a programmatic deficiency; prior corrective action : in a similar event did not prevent this one; other contributing causes such as per-sonnel inattention further demonstrate program weakness (outline 111.A~ II.B. IV.A. IV.E). MFP FOF 11467-472. l PG&E claims that it corrected the problem promptly; no inoperable con-ditions existed without scismic clips; it is making programmatic corrections. PG&E FOF 11M-A132 through M-A134. The Staff agrees with PG&E and claims that this isolated event is not indicative of pervasive programmatic fail-ure. Staff FOF 11-202 through I-205. There is no dispute concerning Mr P's assertions of procedural error and ' degraded condition of equipment associated with this incident. Each error is ) cited directly from MFP Exh. 98, which is PG&E's self-critical NCR. The Board - 'j is called upon to decide whether these errors support an inference of general j l

1. MrP did not cross <marrune PG&E witnesses on any aspect of the nuised surveillance and it did not controvert the adequacy of PG&E's cause deiermination and correctne action

}

3 244 i 'I i 1 i l 1 o f 1 l~-

c w programmatic deficiency in the PG&E surveillance and maintenance program. . MFP Exh. 98 at 7; MFP FOF 11467,468. De record contains no factual evidence related to this event other than that in Exh. 98 and the testimony of PG&E's experts. As has been MFP's practice, it cites PG&E's documents with precision for the purpose of demonstrating error but takes no account of the analyses and corrective actions that are also set forth in the NCR and testimony. The Board accepts MFP's assertion that error in procedure and degraded condition of equipment existed at the time of the incident. However, PG&E's unrebutted description of corrective actions carries the same weight as its description of flaws, and there is no evidence that PG&E's corrective actions were inappropriate or ineffective. The Board finds them reasonable on its own review. We therefore conclude that with respect to the seismic clips the degraded enndition has been corrected and the associated root cause has been identified. No flaw in equipment or procedure is now known to exist on that subject. Therefore there is no basis for an adverse conclusion relative to PG&E's surveillance program or to question the safety of future operations. De Board rejects MFP's claim (MFP FOF 11469-470) that prior corrective action developed for a similar event did not prevent this incident. The previous case dealt with missing clips on initial installation, whereas the one before us is concerned with reinstallation of clips after routine testing. MFP Exh. 98 at i1,14; Tr.1241-43 (Vosburg). The two cases have different causes and the previot.s corrective actions would not have prevented the ; ent cited here. The Board concludes that the missing seismic clips incident was resolved and that the incident does not suggest a general programmatic deficiency in the - PG&E maintenance and surveillance program. 29. Containment fan Cooling Unit (CFCU) Backdraft Dampers MFP asserts that failures associated with Licensee's corrective maintenance of Containment Fan Cooler Unit (CFCU) backdraft dampers over a period of time is evidence of general deficiency in the Licensee's surveillance and maintenance program (outline 11I.B II.A. II.B. II.C, III, IV.A, IV.C, IV.G). He last of these items'(outline IV.G, MFP FOF 60 61) refers to financial matters involving i a ratepayer settlement between PG&E and the State of California and is oeside the scope of Contention 1. PG&E and the NRC Staff acknowledge that performance failures in corrective maintenance of backdraft dampers occurred in both units at Diablo Canyon. PG&E Test, at 88-89; Tr.1261-62 (Giffin); MFP Exh.100; Staff Test., ff. Tr. 2159, at 8-9. The Applicant and Staff claim that the failures were limited to j iifficulties in correcting backdraft damper problems and were not indicative d a general breakdown in the PG&E surveillance and maintenance program. 1 245

1 ..C. / yf' p ' ' ' ' ' Y ~ _1 4 %t y. ,m 'h - /,m w, '? PG&E F0F.1M-A144; NRC Staff FOF,11-217. 2-The Board must decidei ~ Lif the' backdraft damper problems outlined herein were of limited scope and isignificance or if they contribute to a conclusion of general breakdown in the'- licensee's surveillance and maintenance program. j g Each of the DCPP units has five containment Fan Cooler Units (CFCUs) 1, within the containment to provide ventilation'and cooling during normal op-erations and during accident conditions. Each CFCU has a backdraft damper i downstream of the fan. The backdraft damper is designed to close on reverse air g~ " flow and prevent non-operating fans from rotating in a reverse direction. PGAE g . Test. at 88 (Giffin). ? u When a fan is not running, reverse rotation from air flow in the discharge F l duct is an indicator that the backdraft damper is not closed completely. Reverse ' rotation of a CFCU fan is significant because at sufficient reverse speed the fan. j s may trip on overload upon receiving'a start signal in the event of a LOCA. Containment overpressurization during a LOCA is a possible consequence in y certain analytical scenarios involving three non-operational CFCUs with stuck- - open backdraft dampers. MFP Exh.102 at 8-9.- The Applicant has a history of finding reverse CFCU fan rotation in one l or both units during inspections dating back 10.1986. Corrective maintenance-taken between 1986 and 1991 on failed backdraft dampers included replacement I . of parts, design changes in damper linkages, and addition. of springs to assist damper closure. Nevertheless, reverse rotation was observed in a Unit 1 CFCU - during an inspection in March 1991. PG&E decid;d that no corrective action ~ was needed. In January 1992, two backdraft dampers were found i.: Unit 2 with 'j , counterweights that had fallen off. Other counterweights were found to be too loose. l Inspection of counterweights in Unit I. determined that they were attached' but some were installed too tightly. The Applicant concluded by analysis that. this would not affect performance of the CFCU safety function. However, i - three CFCU backdraft dampers were found stuck' open in a February 19,1992-inspection of Unit I. It'was also found that some' damper linkage bars had j previously.bcen installed incorrectly on two of the dampers, and that there were degraded bolting problems on some dampers. The Applicant concluded = and reported to NRC that three Unit I backdraft dampers were inoperable,'that 1 - the condition was outside the design basis of the plant, that it had entered - 1' the applicable Technical Specification, and that'the condition had potentially. - existed since March '1991, Operability of all three CFCUs was restored by February 26, 1992. MFP Exh. '102 at 4; MFP Exh.103 at 5. The Applicant ' s ~ subsequently determined in consultation with Westinghouse that the stuck-open ' dampers did not render the CFCUs inoperable and that the plant had continuously l - met its Technical Specification requirements for the number of operable CFCUs 246 r 4 l P s.-- =* '. ee%.#a %=- g-. w-. y } y-y

i - htween March 1991 and March 1992, when the correct design configuration was restored. MFP Exh.103 at 9. De Applicant reported to NRC in early_ April 1992 that all five Unit 1 L backdraft dampers and one in. Unit 2 had been overhauled and inspected. All Unit 2 dampers had been inspected and found to be correctly assembled. Subsequently, in April 1992, the Applicant found reverse rotation in a Unit 2 fan, counterweights installed too tightly in Unit 2 dampers, and washers installed in Unit 2 dampers contrary to approved design. Corrective work was completed on these problems near the end of April 1992. MFP Exh.102 at 2-7. He Applicant reported to NRC that the root cause of its problems with the backdraft dampers was failure to perform proper maintenance. Contributing f causes were found to involve management underestimation of safety significance, poor planning of damper work, inadequate work instructions, inadequate job turnover, no Quality Control involvement, inadequate Plant System and System Design engineer involvement, inadequate post-maintenance testing, and missed opportunities from prior problems. MFP Exh.103 at 8. NRC issued an NOV to PG&E in June 1992, listing three Severity Level IV violations related to the CFCU backdraft damper problems. The violations were: (A) Work order instructions were not implemented; (B) Inspection of ~ Unit 2 CFCUs done without appropriate procedures: (C) Failure to correct reverse rotacion in CFCU 1-5 from March 27, 1991, to February 22, 1992. NRC accepted PG&E's analysis of operability in the matter of the three Unit 1 CFCUs with stuck-open backdraft dampers and did not.ite the company for violation of the applicable Technical Specification. Later during the period Septernber 25, 1992. to November 13,1992, the Applicant found cracked backdraft damper blades in both Units. It determined that this was a condition potentially outside the design basis of the plant. None of the blades failed in normal service. However, PG&E concluded that longitudinal cracks were of sufficient lenFth to result in blade failure if challenged by the postulated design-basia LOCA pressure wave. The Applicant reported in its LER of November 17, 1992, that it had replaced the blades in Unit I with blades made of fati ue-resistant material and had plans for Unit 2 blade replacement F at the next scheduled outage. Mi P Exh.101. All blade replacement has now been completed. PG&E Test. at 89 (Giffin). De Board finds that the matter of cracked backdraft damper blades was re-solved promptly and effectively. Acre is no record of improper maintenance. This matter is unrelated to the issues previously discussed in this section. The Board concludes that this episode does not contribute to a concern for possible -[ programmatic deficiency in the Applicant's surveillance and maintenance pro-gram. Tr. 1254-55 (Giffin). he Board concludes that the problems cited in the Staff IR, the Staff NOV and in Staff testimony show that there were deficiencies sa PG&E management L 247 f 1

and in the performance of the Applicant's system engineers, rnaintenance engineers, corporate enginects, and maintenance personnel regarding the repair and maintenance of backdraft dampers. However, there is no evidence that any i of these..eficiencies are related to improper financial considerations, as alleged by MFP. The Staff concluded that there was inadequate implementation of basic engineering instincts. Tr. 2210-11 (Miller); NRC Exh. 2: MFP Exhs. 102,140. PG&E was concerned about organizational deficiencies and later undertook a ~ general inquiry ir.ta maintenance practices on the HVAC system. MFP Exh. 100; Tr.1255-56 (Giftin). The Board concludes that repetition of this poor performance in other aspects of the Applicant's maintenance program would raise serious questions about programmatic effectiveness. The Staff characterized PG&E's performance in i this instance as "the biggest black mark in the past few years." However, this performance has not been widely repeated in other aspects of the Applicant's maintenance program. The Staff evaluated the Applicant's performance in the CFCU problem in context with its overall performance in maintenance and found it to be an isolated event. De Staff gave a superior SALP rating to the maintenance program in full consideration of the CFCU problems. Tr. 2214-16 (Miller, Peterson, Narbut). The Staff's testimony is credible and entitled to substantial weight. There is no credible contrary evidence. He Board therefore concludes that the Applicant's poor performance in the CFCU problem was isolated and not repeated throughout the maintenance program. We find ha the CFCU problem at Diablo Canyon does not support an inference of general programmatic deficiency in the maintenance program and we reject MFP's FOF to the contrary. However, we are including the interrelationship of engineering and maintenance, as reflected in the CFCU maintenance problems, as one of the series of examples giving rise to the need for a study to improve interdepartmental communications regarding maintenance activities that we are directing PG&E to perform. 30. Control of Foreign Material / Cleanliness / Housekeeping MFP asserts that a variety of incidents involving unattended debris and for-

i n materials left inside containment have occurred at both units of Diablo F

Canyon, allegedly starting in 1985 and extending to December of 1492. Ac-cording to MFP, problems involving debris and foreign material have safety significance, have occurred repeatedly, and have not been effectively resolved by PG&E despite numerous opportunities to do so. It urges the Board to find that i 248 l t f s

r PG&E's control of foreign materials is inadequate and unacceptable Si MFP also urges adoption of findings of general deficiency in the PG&E surveillance I and maintenance program (outline 11LA II.A. II.B. IV.E). l Bere is no dispute by PG&E or the NRC Staff that the incidents of debris and foreign material in containment occurred as claimed by MFP. PG&E responds - that the incidents cited by MFP are only loosely connected to one another and they collectively do not show a pervasive problem of foreign material or debris control in contairteent. PG&E F0F 11M-A145, M-A146. PG&E claims further that past problems with debris ccr.t.al have been corrected and current housekeeping tr, the plant is unassailable. PG&E FOF 1M-A156. The NRC Staff claims that the events cited by MFP are few in number, unconnected with one another, and are not evidence of any general breakdown in the Applicant's surveillance and maintenance program. Staff FOF 11-228. The Board is called upon to decide whether the incidents cited by MFP of ' debris or foreign material periodically left in containment collectively indicate a programmatic deficiency in the PG&E surveillance and maintenance program. I a Foreign Material Exclusion MFP Exhs.107 and 108 document a series of violations involving loose tools in containment, untimely personnel actions to correct foreign material exclusion deficiencies, failure of corrective actions to prevent repetition, and loss of cleanliness controls. The violations occurred ova a short period of time from March through May 1988. NRC issued NOVs citing PG&E with first a Severity Level V violation (MFP Exh.108f and later a Severity Level IV violation (MFP Exh.107). PG&E's replies to the NOVs are documented in PG&E Exhs. 25 (PG&E Letter No. DCL-88-ISJ, June 6,1988) and 26 (PG&E Letter No. DCL-88-184 July 18,1988). The Applicant outlined its corrective actions which included de-velopment of foreign material exclusion procedures, revision of administratise procedures to ensure compliance with cleanliness controls, revision of proce-dures to require Quality Control Department surveillance of housekeeping in containment when the reactor vessel is open, and additional training for per-sonnel. PG&E acknowledged that corrective actions stated in Exh.108 (issued May 5,1989) did not prevent the ms of cleanliness control cited in Exh.107 (issued June 17, 1989). M MiP rebes on the folhimng exhibus conusung of NRC and ICAE regulatory docunrnts in support of ats assensom MiP Lah 105, P'itC IR 92-31112/18M2L MiP Exh 1% NRC Diablo Canyon ShusJown Risk and outaFe Manapenent Impe don. NRC IR 50-275N2-201 (12/8N21. MI'P Exh 107. NRC 1R 88-10 and 88-11 (6/17/Hil). Mi P rxh ION. NRC NoV sn IR HK 0715/5/Kih Mi P Leh 109 NCR DC2-91.TN-N102 R2 (ll/18N2h MIT Lah 110. NCR DCO 91-MM-N(M2 (5/19/u21. MI P Exh IIt.1.1 R 2-91012-00 (3/5N2L MrP Exh.1l3. PG&E reply to NoV in NRC LA M9-241 O/12/90L MiP Exh 35. IC&E Self-I'valuanon of DCNPP DND 249 f f

t i; MFP Exh. I10 is an NCR issued May 19, 1992, that analyzes program-matically several instances of loss of foreign material exclusion area (FMEA) controls of the type described in MFP Exhs.107 and 108. FMEA controls are for the purpose of preventing entry of loose parts into the reactor coolant system i during refueling or maintenance activities. Root cause for several instances of loss of FMEA controls was found to be due to management failure to imple-ment the FMEA program as described in applicable administrative procedures. Contributing causes included " lack of ownership" on FMEA jobs, inconsistent interpretation of requirements, procedu.es not user friendly, management ex-pectations not communicated, and insufficient FMEA boundary identification. ^b De Technical Review Group (TRG) conducted a thorough investigation and recommended many corrective actions. Dere is no evidence that the corrective actions were ineffective and they appear reasonable to the Board. MFP Exh. i10 at 5-14. MFP Exh.113 (March 12,1990) is PG&E's reply to an NRC NOV in r which it acknowledges three violations that in the aggregate were categorized as a Severity Level III violation applicable to Units I and 2 containment recirculation sumps. One of the aggregated violations was for an inadequate inspection of the Unit I containment sump for loose debris. Debris that could cause restriction of sump suction during a LOCA was found inside the upper grating assembly of the Unit I sump by an NRC inspector. The inadequate PG&E inspection was due to individual failure to implement a clear procedure. PG&E Test. at 106 (Crockett). PG&E took several correctue actions including initiating video probe inspection of sump pipes and valves for debris, revision ' of technical and administrative procedures to ensure attention to recirculation sump cleanliness, implementation of foreign material exclusion requirements for sump activities, and establishment of foreign material exclusion requirements for sump suction piping during refueling outages. Here is no evidence challenging the effectiveness of the corrective actions and the Board sees no reason to do i so. This violation has not been repeated. Tr. 1508-09 (Crockett). b. Unattended Marerialin Containment MFP Exh. III is an LER issued in March 1992 reporting unattended tools and debris found in Unit 2 containment in October 1991 and Applicr* failure to meet the containment inspection requirements of TS 4.5.2.c after containment integrity was established. MFP Exh.109 is an NCR issued November 18,1992, documenting the debris control problems in Unit 2 containment cited above. The root cause for this event was determined to be " lack of a comprehensive program for control of material after containment integrity has been established." , A contributing cause was lack of understanding of requirements by some individuals who failed to complete a required data sheet certifying that a visual k t 250 i

t inspection had been performed and no loose debris was present in containment. To correct the problem the Applicant established a comprehensive new program for control of material in containment, and trained personnel in the procedures. MFP Exh.109 at 9-12,23-25. MFP Exh.105 is an NRC NOV issued December 11,1992, citing PG&E with a Severity Level IV violation for corrective actions (described above for Unit 2) that were ineffective to prevent uncontrolled materials inside Unit I containment when containment integrity had been established. Loose, unattended materials were found near the Unit I containment sump on November 5,1992, after containment integrity had been established. The safety significance of this event was low and Applicant's proposed corrective actions (offered immediately at the exit meeting) were accepted by the NRC Staff as adequate to correct the deficiency. MFP Exh.105 at 6-8. c. Other Material Control issues MFP Exh.106 is an NRC IR documenting a 1992 Staff shutdown risk and outage management inspection conducted in part by headquarters Staff. A defi-ciency was found in which a %-inch instrument tubing disconnected for main-tenance was not capped to prevent entry of foreign material. The Applicant had no procedures to control entry of foreign material into disconnected instrument tubing. This was the only FMEA deficiency cited and the team found in general that the housekeeping and material control throughaut tt plant were strengths. MFP Exh.106 at 20-21, A-3. PG&E added the missing requirement to its pro-cedures for instrumentation. Tr. 1516-17 (Crockett). This was an isolated event of low safety significance that was corrected by minor procedural changes. It has no implication for the programmatic adequacy of Applicant's surveillance and maintenance program. Tr. 2237-38 tMiller). The Board gives it no weight in its decision. MFP Exh. 35 is a PG&E self-evaluation of Diablo Canyon issued in July 1993. Deficiencies in the performance of some supervisors with responsibilities for housekeeping and programmatic deficiencies in implementation of house-Leeping practices were found. MFP Exh. 35. MA.1-1, MA.2-1. Deficiencies related to uncontrolled debris refer specifically to material found in the Turbine and Auxiliary Buildings for which we have no evidence on safety significance.32 The report concludes that " minor houscLeeping discrepancies remain high," The NRC Staff, however, finds the plant clean and in a general state of good house-l l i 32 All prenous rudence on the safety sigmficance of debns relates to its sigtuficance m cumamment where sump screens muld tecone clogged dunng an accident or fore 1Fn matenal could inadvertently enter the reactor coolam I system There as no smular endenct m the record for the Turbme BusMng or Auuhary HusMng. 1 251

w, e y keeping. Tr. 2239-40 (Miller, Narbut). The Staff inspector occasionally finds-I material on the floor but the plant staff takes care of it quickly. We conclude that enere is likely a continuing flurry of minor housekeeping discrepancies at Diablo Canyon. This has no adverse implications for the surveillance and maintenance program because there is no evidence that the discrepancies cited in MFP Exh. 35 have safety significance. He overall housekeeping program produces generally good results. We find the self-critical analyses displayed in MFP Exh. 35 to be a programmatic strength because they focus attention of plant personnel and supervisora on the ecntinuing need to be alert for developing problems. Minor housekeeping deficiencies at DCPP are entitled to no weight in the licensing decision before us and we reject MFP FOF to the contrary. d. Board Analysis ne Board has considered the cluster of exhibits on material control in the light presented by MFP (i.e., that in the aggregate they would show a programmatic deficiency in material control in containment which in turn would contribute to an aggregate finding of pervasive deficiency in the plant surveillance and maintenance program). Based on Staff testimony and the exhibits themselves, we conclude that the Applicant had programmatic-level problems both in the control of debris in containment and implementation of FMEA requ rements during the 1988 time frame and th treafter. In both areas, PG&E and Staff analyses found programmatic deficiencies. There was repetitive occurrence of deficiencies after corrective actions had been taken. Root causes were related to adequacy of management, adequacy ofinstructions to personnel, adequacy of technical procedures, and comprehensiveness of corrective actions. De difficulties were corrected, however, and recent inspections show little or no deficiency with material control in containment. Tr. 2236-40 (Miller, Narbut). It does not aid the inquiry to further aggregate deficiencies related to FMEA issues with those related to debris in containment absent evidence, which is lacking here, that deficiencies in different categories are traceable to the same procedures, personnel, or management. We conclude that the Applicant and Staff are correct to distinguish deficiencies into separate categories because this is the way they are identified, ana'sd, and corrected in practice. Tr. 2235-36 (Miller). In presenting its case through exhibits prepared by PG&E or the Staff, MFP ignored corrective actions that appear in the same or associated exhibits that are relied upon to show deficiencies. However, we do not read these documents selectively but consider both the deficiency and the corrective actions they describe to be equally credible. Therefore, in general, a deficiency such as this one that has been resolved for the purpose of enforcement will not rise 252

C, y +

to the.;.portance of mandating denial of the license extension. We do not sit to sanction PG&E for past deficiencies or violations of NRC regulations?

Our inquiry is related only to whether the plants are being sufficiently well maintained that they can be operated with reasonable assurance of safety in the requested license recapture periods. Thus, for MFP's case to be persuasive, there must be evidence that there are current serious defects in the surveillance and maintenance program which the Applicant is either unwilling or unable to correct? The record does not support that view. De Applicant's and NRC Staff's testimoiay were persuasive that such defects j or impediments to correction do not exist in matters relating to debris in containment and we find that the past safety-significant deficiencies cited by MFP have been adequately corrected. For all of the foregoing reasons we reject MFP's FOF on debris issues in their entirety and find that PG&E has carried its burden of proof on the issues of debris and foreign material exclusion in containment.

31. Steam Generator Feedwater No::le Cracking A steam generator feedwater nozzle is a 20-inch-diameter piping connection through which feedwater flows into each steam generator. The nozzles and immediate upstream piping are susceptible to interior surface cracking caused by thermal stress that occurs when, on infrequent occasions, cold water flows thmugh a hot nozzle. Ultrasonic inspections of Unit I fu Jwater nozzle welds performed earlier than scheduled during a refueling outage in September 1992 showed some surface cracking. A short piping section and the pipe-to-nozzle welds were replaced on all four Unit I steam generators. Later metallurgical investigations showed that the repairs were unnecessary because the cracks were actually smaller than originally thought and within the allowable range of the ASME Code. Calculations showed that the plant could have been operated at least to the end of another refueling cycle, when regular inspections were 33 Commewah4 Edmm Cu (Braidwood Nuclear power stanon. Units I and 2). Al.AB 890,27 NRC 27A 278 (1958t the Appeal Board found on the marier of possible violauon of Comnusuon segulanons- ~But this is not an enforcenent proceedmg and the issue as tuind is thus not whether a bancuon should be imposed agamu the unhry becauw of us asserted noncomphance with a Comnussion regulatmn Ruher, we are concerned i ;us bernsmg

- oceedmg with whether the 1.scensmg Board correctly authorized the issuance of operatmg heenws. Commonweatre Eduon Co (Hyron Nuclear Pomer Sianon. Uruts I and 2). ALAB-770.19 NRC 1861 t169 (1914 ) The Appeal Bosd obwrsed on the matter of derual of an apphcanon "such a result would depend for its vahdary upon a supponed findmg that it is not posuble for the ascertained quahry assurance fashngs either so be cured er to be overcome so the ettent necessary to rea6h an mforrned ud nent that or facihty has been J F properly constructed

• Here the issue is not whether the plam han been properly constructed but whether et has been pmperly maniamed We conclude, however, that with respect to the nuuntenance and surveillance program.

the appbcanon before us could rmt be derued unless there mas a supported findmg that mantenance dehcencaes could not or would not be corrected We inay impose, and in fad are imposmg. condmons to correct cenaan aspects of the ma nienance and sutveillance program that we deem dehement. l 253 i 1

y i scheduled, without hazard from feedwater nozzle weld cracking. PG&E Test. at 91-92 (Crockett); Tr. 1536-37,1540-41,1551 (Crockett). PG&E has now decided to perform nondestructive testing on main feedwater piping during each refueling outage rather than on the 10-year schedule allowed by the ASME Code. Tr. 1552-53 (Giffin). MFP Exh. I17 is a voluntary LER (Indications on the Main Feedwater Piping Near the Steam Generator Feedwater Nozzles Due to Thermal Failure, 10/30/92) submitted to the NRC for information purposes that describes the steam generator feedwater nozzle cracking problem..As part of background, it discloses that Unit I feedwater nozzle radiography performed in 1986 during the first refueling outage in response to NRC IE Bulletin 79-13 was incomplete. It also discloses that some radiography techniques employed at Unit 1 in 1979, 1986, and 1987 may not have been in full compliance with Bulletin 79-13 requirements. Radiographs on pipes with cracks from the 1992 repairs suggest tha: the cracks would not have been detected by radiography. PG&E concluded that the errors had no safety significance. MFP's complaint in this matter arises from its interpretation of the early radiography errors disclosed by PG&E in the LER (MFP Exh. I17). In MFP's view, the errors that occurred in 1986 and 1987 had safety significance because they were blatant, they remained uncorrected for a long time, and they could have led to serious safety risk had the rate of cracking been more rapid. This exemplifies a maintenance and surveillance program not functioning as it should, according to MFP. MFP FOF 1552. According to MFP, most maintenance proolems disable or threaten essential safety systems (outline I.A); there is untimely detection and correction of aging effects (outline 111.C); and there is inadequate routine surveillance, tests, and inspections (outline IV.C). The foregoing failures are claimed in turn to be contributing evidence of a generally inadequate surveillance and maintenance program at Diablo Canyon. PG&E concludes that the discovery and resolution of the nozzle cracking problem is an example of the proper functioning of the DCPP maintenance and surveillance program. Tr.1538 (Crockett); PG&E Test. at 92-93 (Crockett). According to PG&E, the NRC Staff thought that the PG&E analysis of the nozzle cracking problem was reasonable. Tr.1556 (Crockett); see Staff FOF 11-231. There is no disputed material fact related to the discovery and correction of feedwater nozzle weld cracking in 1992. Ilowever. MFP calls upon the Board to agree with its adverse opinion of the 1986 and 1987 errors in radiography. We decline to do so because the issue was not ventilated at hearing; NRC Bulletin 7913 is not in the record; there is no record of regulatory obligations created for the Applicant by Bulletin 79-13; the safety significance of the errors is not self-evident, coming as they did early in the operating life of the plant; and 254

) i t ' PG&E's conclusion of no safety significance is uncontradicted. We find this issue, developed for the first time in MFP's proposed findings of fact, to be speculative. It is undisputed, however, that in 1992 PG&E found and corrected small surface cracks in the Unit I steam generator feedwater nozzle connection welds well before crack growth could have exceeded code-allowable dimensions. Tr. 1553-54 (Giffin). This was effective preventive maintenance. Contrary to MFP proposed general findings of fact for this incident, no essential safety system k was disabled or threatened; the detecuon and correction of the cracks was timely. because it occurred before any code allowable was exceeded; the inspection leading to the discovery of cracks was not routine but proactive and it resulted. in early detection. He Board concludes that nothing in this incident undermines confidence in the surveillance and maintenance program at DiAlo Canyon. He Board rejects MFP's contrary claims and finds that PG&E hm proved its case on the steam generator feedwater nozzle weld cracking issue.

32. Procedural Controls During Shot Peening Operations Dree incidents of unanticipated spread of radioactive cor <.mination and/or airborne radioactivity occurred during inspection and maintenance operations -

on steam generator hot and cold legs, one on Se9tember 25,1992, one on September 26,1992, and one on October 2,199?.. Circumstances in all three incidents were similar. In each case a cold-leg manway door was opened while shot peening was beinF carried out on the hot leg of the steam generator and eddy current testing was being carried out on the cold-leg side. The hot leg was pressurized with dry air and the air from the shot peening operation, while the cold leg was supposed to be under negative pressure from an exhaust system using a high-efficiency particulate air filter, but the open manway door provided a direct outlet for the contaminated air, bypassing the filter. He contamination incidents resulted in an NOV of Severity Level IV. MFP Exh.118 at 1,8. Between the first and second incidents, between the second and third, and after the third, the Applicant took corrective actions in an attempt to forestall recurrence. These included additional instructions for those performing the maintenance and inspection work, and the addition of a checklist to the procedure for the eddy current testing and further instructions for the shot peening procedure. Finally, the air flow direction was reversed after the last incident, moving the dry air input to the cold leg and the littered exhaust to the hot leg. PG&E Exh. 22 at 9-10. MFP would have us conclude from this series of incidents that "these factors, taken together with the ot;.er deficiencies described [herein], indicate an inadequate maintenance and surveillance program at DCNPP." MFP FOF $66 255 i r i f f

at 202. MFP categorizes these incidents as ones that disabled or threatened safety systems (outline'11.A), as a previous corrective action that failed to prevent recurrence (outline 111.B), as representing insufficient communication (outline IV.E). 11V.A), and as an example of inadequate work instructions (outl accorded no weight." PG&E F0F1M-A166 at A-70, Reply FOF R-A102 at A-50; Staf f F0F 11-237 at 95. Both state that the document is "only peripherally" related to maintenance. PG&E F0F 1M 4166 at A 70, Reply FOF 1R-A104 at A-50; Staff F0F11-237 at 96. The Staff and PG&E interpret the meaning of the terms " maintenance" and " surveillance" far too narrowly, These incidents were all the results of improper actions on the part of persons performing maintenance and surveillance activities. PG&E sought to correct all of them by improving the dding to training of maintenance and surveillance personnel and by altering or a maintenance and surveillance procedures. To say that such incidents do not bear upon the maintenance and surveillance program is to stand logic on its head. Although it is true that the primary purposes of the procedures, eddy current testing and shot peening, may have been accomplished, in our view doing the job includes the notion of doing it safely, without putting plant personnel or public at risk.We do not, however, find that the incidents noted weigh strongly enough to condemn the entire program or even to call it to question. These were three - incidents within the space of about a week in which a one-time operation was attempted for the first and only time. We do not find it urprising that errors of this degree were made, nor are we shocked to note that it took three tries to correct them. The evolution of these incidents reflects somewhat poorly upon d ht the maintenance and surveillance prograrn, but not so poorly as to con emn t a program, and the careful analysis and prompt actions taken to correct the flaws i weigh heavily in the entire program's favor. Unplanned Actimtion of Engineered Safety Features (ESF) 33. MFP submitted as exhibits a series of documents (MFP Exhs. I19,120,121, 122,122A,123,124,126, and 127) describing five incidents in which unplanned ESF actuations occurred. PG&E's analyses of these events and its reports of ll three them to NRC found that personnel error lay at the root of each, as a l parties agree. PG&E FOF 1MA-169 through MA-173 at A70-A72; Staff FOF 11-240 through I-244 at 96-97: MFP FOF t 573-77 at 205-07. MFP would have us find that "[ijnadvertent ESF actuations are significant occurrences" and that "the number of personnel errors involving unplanned ESF actuations reflects poorly upon the adequacy of the maintenance and surveillance program at DCNPP" (MFP FOF 1580 at 207,1587 at 209). We cannot agree. 256 i l l i l

rj.. De number of surveillance and testing operations performed annually runs into the thousands. Tr. 834-35 (Crockett). The five instances noted in MFP's exhibits were indeed " benign": careful analysis in each case concluded that no i threat existed to the public safety. Although it is true that inadvertent actuations I are to be avoided (Tr,1576 (Vosburg)), they are-scarcely the " absolutely horrible" (Tr.1578 (ZamEk)) matters that MFP, in cross-examination, tried to make them out to be. Indeed, we agree with PG&E and the Staff that, generally [ speaking, ESF actuations move the plant to a more conservative condition. Tr, 1576 (Vosburg); Staff F0F 11-239 at 96; PC&E FOF 168 at A-70. For obvious reasons, tripping the plant is to be avoided, and any inadvertent ESF actuation causes undesirable reporting and paperwork. Tr. 1577-78 (Vosburg). But these E are not inherently unsafe incidents and they do not appreciably contribute to the wear-out or breakdown of safety-related equipment. Tr.1580 (Vosburg). 11aving read MFP's exhibits in some detail, we are favorably impressed first with the apparent paucity of the mistakes compared to the total number of actions taken per year and second with the diligent and analytical dissection of each error that PG&E carries out, even when the subject error is of little safety significance. We find the overall impression borne by this particular set of exhibits to be very favorable to the maintenance and surveillance program at DCPP. M. Limitorque Valve Failure MFP offered two documents concerning a single failure of a 1.imitorque valve operator. Rese are, respectively, an NCR and an LER reporting on and analyzing the failure of a Limitorque valve operator during a test of that operator. MFP Exhs. 128,129; Tr.1589-90 (Ortore). Analysis indicated t;iat the operator failed because a locknut and the setscrew intended to secure the locknut had not been tightened properly. He immediate situation was corrected, an investigation was performed to determine the reasons why the locknut was not properly secured, the INPO network was informed of the occurrence, crews were tailboarded on the importance of the proper attention to details on such valves, other similar valves were inspected for loose nuts and set screws, the hardness of the worm gear shafts in other valves was measured and it was found that this factor varied, suggesting that part of the cause was an inability of the set screw to properly hold the locknut, (indeed, contact with the manufacturer disclosed that the material of the worm shaft had been changed), and the procedure for assembly of the locknut was revised to specifically include instructions for tighteninF the set screw. It was revealed in the course of the investigation that loose nuts were to be found only on valves worked on by one specific technician. MFP Exh.128 passi~ 257 d

l MFP would have us find that the DCPP mar enance and surveillance program is deficient because it did not catch this problem before it occurred by supplying instructions on the tightening of set screws, measuring the hardness of the worm shafts, and developing a " proper method for securing the lock nut to MFP FOF 1594 at 211. We note that even in the state the worm shaft." revealed by the test, any suspect valve operators would have been capable of MFP Exh.129 at 7. We also note the carrying out their safety functions. diligence and completeness with which the investigation was pursued and the sensible steps taken to prevent recurrence. In our view, far from showing any l fundamental flaw in the maintenance and surveillance program, this incident L and its followup demonstrate the program's strength. This problem, however, represents another example that leads to our conclusion that PG&E should perform a study seeking improvement of interdepartmental communications for maintenance-related activities. Motor Pinion Keys in Limitorque Motor Operators 3S. MFP submitted an exhibit (MFP Exh.132) concerning failed motor pinion keys in motor-operated valves, and both direct and cross-examination were car-1615-25 (Ortore Vosburg)). ried out on witnesses familiar with the exhibit (Tr. MFP Exh.132 is a voluntary LER submitted by PG&E concerning an incident in which a irotor pinion key failed. The analysis did m t now any safety prob-lem, and the LER was submitted on a voluntary basis in order to keep NRC and the industry informed of potential mechanical failures. Indeed, other similar valves were found to be operable even with their motor pinion keys sheared, inasmuch as the friction between motor pinion and shaft is sufficient to operate the valve without the key. MFP Exh.132, at 3,6,7; Tr.1616,1618 (Ortore), 1521 (VosburF)- The key sheared off during the incident because, through a miscommunication between the maintenance personnel and operating personnel, it was subjected to "short stroking" while in a manual mode of operation, an overstressing condition d that it would generally not encounter in service. The vendor, in fact, believe that the key was of sutlicient strength, but has now changed the design to specify a stronger material. MFP Exh.122 at 3,1. MFP would have us find that the miscommunication that revealed the low strength of these keys " reflects a pattern of miscommunications between maintenance and operations, which has caused other problems in these plants" and that the low strength of the keys and the failed keys in certain valves reflect a "significant number of safety defects in safety components that are found only through luck," and that "PG&E's inability to detect and correct these hidden defects in a timely way could have a significant adverse effect on safety... " MFP FOF 11604 and 605 at 214. 258

i ~ - 1n our view, the fact that the valves were still ope 4fe with the mternal defect suggests that the hidden defects were not serious safety matters, and the thorough review and analysis of the situation, once discovered, reflects very positively upon PG&E's willingness to analyze and improve its procedures when chance reveals hidden flaws, however inconsequential. Communications can, of course, always be insproved between organizations sharing responsibility for plant maintenance and operation, and in this case we believe they have been. Surely the entire episode does not reflect any fundamental problems in maintenance and surveillance.

36. Control of Lifting and Itigging Devices MFP presented two instances that it alleged showed failure on the part of DCPP maintenance and surveillance personnel to properly control and imple-ment lifting and rigging procedures. The first occurred on March 7,1991. It was an incident in which a crane was being used to lift a relief valve into position on a main steamline outside containment. MFP Exhs. 135, 136. The boom of the crane came too close to a 500 kV power line and the line arced to ground, causing a loss of offsite power. The 230 kV startup system had been cleared for maintenance and was not available. The emergency diesels started and loaded the vital busses, constituting an ESF actuation, and there was a momentary loss of residual heat removal.

Refueling as in progress at the time and one asser aly was in the manip-j ulator crane and positioned over the core. Several systems were affected by i the loss of power, and not all equipment functioned as intended. For example, the auxiliary building ventilation fans could not be restarted until certain com-ponents were replaced; emergency diesci EDG l-1 started, but only after 19 seconds rather than the 10 seconds that is the Tech Spec limit; and the Unit I control room emergency lighting failed to function. MFP Exh.135 at 5-8; MFP Exh.136 at 5-9. Safety analyses concluded that the health and safety of the public were not endangered by this occurrence. MFP Exh.135 at i1: MFP Exh.136 at 12. However, personnel safety was endangered by the are to ground of a 500 kV line. Tr.1635 (Giffin). .j The root cause of the event was human error compounded by inc.*fective use of existing management systems. Apparently the crane crew did not even know that the 500 kV line was energized; they assumed that since the plant was shut down the line was dead; and they did not know it could be used to backfeed power into the plant. The foreman was apparently distracted by the many other activities he was coordinating at the same time. MFP Exh.136, Attach. 2 passim. 259 l

g V, Although this incident seems to the Board to indicate a number of flaws in the maintenance and surveillance program, it does not seem focussed upon the sort of knowledge and experience expected of the rigging and lifting crafts. It scarcely' takes an expert rigger to know that one should stay away from high-voltage lines with crane booms. He problems seem aFain to center around communication (a knowledge of the state of the system one is working on), training, and attention. De second incident involved a radwaste container being prepared for ship-ping. On May 28,1992, the primary and secondary cask lids were being installed on this container and a mechanical maintenance foreman was supervising the operation. He left the area. He lids had initially been lifted with three slings and placed on the cask. The clearance between the lid and the cask was very I close and the lid required some alignment. To facilitate this alignment, the crew decided to use two chainfalls and a sling in the operation. They mistakenly chose two 1-ton chainfalls to lift a weight that was close to 2400 pounds for each chainfall, because they misjudged the weight. MFP Exh.137, Attach. at 4: PG&E Exh. 27. Encl. I at 1-2. The error became a subject of an NRC inspection report and resulted in a Severity Level IV Violation. MFP Exh.137, Cover Letter at 2. ne work of loading the cask was being carried out under Maintenance Procedure M-50.23, and was being supervised (at least at the start) by a mechanical maintenance foreman. When he left the scene, the rigging crew, i in violation of sules and of the scope of the tailboard t'iat had introduced the work, improvised in an area where their knowledge was insufficient. PG&E Exh. 27, Encl. at 2. Dere appears to be a difference of opinion as to the significance of this incident with respect to personnel safety: the NRC inspector noted "that this was a personnel safety issue and that the individual standing on the cask lid could have been seriously hurt if the chain had parted" (MFP Exh.137 at 4), whereas PG&E management opined that the incident "did not present a threat to personnel safety" since "the lid would have dropped a maximum of two inches and could not have slipped off the lip of the container.. " PG&E Exh. 27 Encl. 2 at 1. It seems to the Board that, whichever opinion one adopts, it is clear that an incident like this one could have personnel safety significance, and it is important that measures be ir. ;' ace to prevent such happenings. MFP would have us find that "these two incidents share some pertinent characteristics and thus they demonstrate a deficiency in PG&E's ability to control lifting and rigging devices for heavy loads." MFP FOF 633 at 227. PG&E believes that the two incidents are unrelated, or at least that they do not "have any commonality." PG&E Exh. 27. Encl. 2 at 1: PG&E FOF M-Al90 at A-77. Staff witness Miller said that the questien whether there might be a common causal factor between the two incidents had not yet been decided 260 L

y, l {. ' (Tr. 2248). Both Staff and PG&E would have us find that the later of the two r ' incidents, the chainfall ctror, was not related to maintenance (PG&E Reply FOF 1R-Alli at A-52; Staff FOF I-258 at 103-04). Both cite our previous ruling on contentions (LBP-93-1,37 NRC at 23) wherein we found that these and other incidents did not have a common focus with respect to a failure of the personnel and training programs. PG&E F0F 1MA-191 at A-78; Tr.1637-38. Although the two incidents may not reflect in a common manner on the personnel and training programs, we do see certain parallels. Further, since the second incident was beinF carried out under a procedure that PG&E itself styles a t " Maintenance Procedure" under the direction of an employee titled " Mechanical Maintenance Foreman," we believe that both bear upon the adequacy of the maintenance program, and that both reflect poorly upon that program's ability to communicate both vertically (from supervisor to supervised) and horizontally (from itself to other organizational components). Nevenheless, we do not see in these incidents any basic flaw of sufficient e proportions to warrant denying the license amendment. These incidents, how-ever, are being included as pan of the basis for our requirement that PG&E conduct a study seeking improvement in interdepartmental communications re-garding maintenance-related activities. 37, Main Feedwater Pump Overspeed Trip Due to Failure of Power S.ipply to Speed Sensing Probes MFP points out several failures of the feedwater pump speed controllers. MFP IOF $1634-657 at 227-35; MFP Exhs. 138,139,140,140A,142. On March 6,1992, a reactor trip occurred because of a low-low water level in the 1-3 steam generator. The low-low level was the result of a trip of the 1-1 feedwater pump. The inverter feeding the speed controller on that pump had failed, an automatic transfer to a second inverter also failed, and the loss of the speed control channel caused the pump to go to a maximum speed condition, which resulted in a pump trip. MFP Exh.138 at l-4. PG&E's analys% of the event concluded that the root cause of the failure l was that the origin'al (pre-1989) design of the speed probe system was a single-channel design and hence incompatible with the later-installed Lovejoy system that failed. The problem had been earlier identified in a letter from a technician, a letter that never received a response. Id. at 10. 'Ihe failure of the probes to transfer to the alternate power supply was caused by a small piece of insulating debris, which had fallen between the points of a relay contact. MFP Exh.140A at 4. In the course of investigating this event, PG&E discovered that the type I of inverter whose failure had set off the sequence had failed nine times between 1990 and 1992, each of those failures having resulted in repair or redesign in t consultation with the manufacturer. MI'P Exh.138 at 2-4. i l 1 261 1 I

1 ' On April 23,1991, a failure of main feedwater pump speed control had also occurred and had led to a turbine trip and a reactor trip. The root cause of that event was found to be failure of an amplifier in the Lovejoy control system. MFP Exh.142 at 2-5. . The inverter difficulties all arose from a set of new inverters installed in November of 1989 in an effort to give the pump speed control a more reliable power supply. Tr.1651 (Giffin); MFP Exh.138 at 2. Obviously the effort was L less than fully successful. MFP would have us find that inverter failure was a "long standing problem" at DCPP, and that PG&E's actions were ineffective in preventing the problem's repeated recurrence. MFP F0F 1643 at 232. Even PG&E concedes that "[w]e waited too long and continued to try to fix [the problem] instead of just putting in a new design" and "we should have written off the power supply." Tr.1652 (Giffin); MFP Exh.138 at 18. The Staff and PG&E do not see the problem as a maintenance and surveillance problem. The Staff says, "MFP offers no connection between these findings and PG&E's maintenance and surveillance program The issue of concern to PG&E and NRC related to the timeliness of PG&E's design engineering program efforts, not to the maintenence program." Staff FOF 11-261 at 1(M. 05: Tr. 2246-47 (Miller). PG&E says the sequence of events "did not reflect directly on either maintenance or surveillance." PG&E F0F 1M-A195 at A-79; Tr.1653 (Giffin). Once again we believe that the Staff and PG&E scad the scope of. the contention too narrowly. If maintenance efforts fail or are untimely because of a failure to properly coordinate with the engineering department or because of a failure of engineering to properly support maintenance, that is in itself a failure of the maintenance program viewed in a holistic sense. MFP would also have us find that "[f]inancial consideration influenced PG&E's corrective action." MFP FOF 648 at 233; MFP Exh.138 at 18. That may well be so. There does not, however, seem to be any tendency to compromise safety for financial reasons. Indeed, both PG&E's technical witnesses and the technical witnesses for the NRC Staff characterize the pump speed controller failures as matters of little or no safety significance. Tr.1653 (Giffin); Tr. 2216 (Miller). We agree. It appears that the greatest significance for the main feedwater pump failure is the effect it has on operability and availability of the plant rather than on nfety. Although PG&E's response to the failures may have been as " untimely and inefficient" as MFP would charactenze it (MFP FOF 1650 at 233), there seems to have been no substantial effect on safety. MFP is correct that any problem with a feedwater pump can introduce the possibility of a transient, and that transients are not desirable from either a safety or availability standpoint. But we accept the professional opinions of 262 l l I i

7 the technical witnesses presented by the Staff and PG&E to the effect that the pumps are not safety-related equipment. Tr.1653 (Giffin); 2219 (Peterson). We are again confronted with a situation in which the response of the maintenance and surveillance program as a whole has been less than perfect. L -The delay in fixing the inverters in particular demonstrated poor engineering support for the maintenance effort. But the matter is not one of substantial safety significance, and we cannot see it as reason to deny the license extension. We are, however, including this matter as one of the bases for our requirement that PG&E perform a study seeking to improve coordination of the maintenance department with other departments (such as engineering) engaged in performing maintenance. type activities. 38. Inadvertent Containment Ventilation isolation MFP introduced a series of NCRs and LERs purporting to show instances i of containment ventilation isolation (CVI) resulting from personnel error. MFP Exhs. 144, 145, 146, 146A, 147, 148, 149, 149A. 150, 150A. 10, 151 A. In the views of the Staff and the Applicant (which coincide), these events are unrelated to one another except that they all led to CVI. Staff FOF I-269 at 107; PG&E FOF SM-A202 at A-82. Both Staff and Applicant point out that CVI is inherently a " benign'* cvent, that is, simply a change to a safer (more conservative) condition, and that the wear and tear on saf ty devices resulting from CVI is minimal. Staff FOF 11-267 at 107; PG&E FOF 1M-A199 at A-80; both citing Tr. 1670-71 (Vosburg). MFP would have us find that these incidents show several major flaws in the DCPP maintenance program: ineffectiveness of attempted corrective actions, lack of communication and coordination between maintenance and other departments, financial considerations influencing safety decisions, failure to adhere to procedure and policy guidelines, and untimely response to deficiencies in the radiation monitoring system. MFP FOF t1663, 665, 670, 674, 680, 684. The Staff and Applicant would have us find that, there being no real nexus between these events, the charge of ineffective corrective actions is not warranted. PG&E FOF M-A202, M-A203 at A-82: Staff FOF 11-270 and I-271 at 108. Both of these parties point out that recent regulatory changes have been made in reporting requirements to downplay the importance - safety of-CVI events. PG&E FOF M-A199 at A-81; Staff FOF I-267 at 107; both citing Tr. 1668-69 (Vosburg). Both the Staff and Applicant also point out that the radiation monitoring system is in the process of being upgraded to a digital system that should be less sensitive to electrical noise in the plant. PG&E FOF i 1M-A200 at A-81: Staff FOF 1-269 at 108, both citing Tr. 1673-74 (Giffin). Neither the Staff nor PG&E addresses the matter of financial considerations, but we find that the portion of the record cited by MFP (MFP Exh.148 at 7, 263 r F f

r i e 15)- when taken in context - does not suggest that financial considerations played any strong role in the decisions made.on methods to address the CVI I problem at hand. We do, however, find two matters troubling. The first is the fact that "[t}here 1 is no plant or GC procedure specifically regarding work on energized equipment" (MFP Exh.150A at 12). His lack of procedures is particularly serious inasmuch as four of the CVI events resulted from enors on the part of personnel who were working on energized equipment. These numerous errors warrant a specific list of precautions for affected personnel We do not accept PG&E's argument that these precautions are " common knowledge to journeymen electricians" (id.) since, if this were the case, there would not have been the four CVI events. He second matter is the timeliness of PG&E's response to the oversensitivity of the radiation monitoring system to electrical noise. The system has exhibited this characteris;ic "since the Units have been operating" (MFP Exh.149A at 5), yet PG&E is only "in the process of installing" a new syr, tem, and while the specific monitors involved in the incidents listed by MFP no longer give trouble, other instruments in the system still do. Tr. 1673-74 (Giffin). Despite the avowed benignity of a CVI incident, as we noted in Section 33, supra, unneeded actuation of ESF should be avoided. It stresses the crew and diverts i resources. Tr. 1577-78 (Vosburg). The Board feels that it is high time the steps (apparently well known) that are needed to further suppress this undesirable ESF actuation should be taken. Accxdingly, we direct that the conversion of the radiativ.i monitoring system be completed and that a set of rules for working on energized equipment be promulgated. l 39. Reactor Trip on Steam Generator Low Level Two exhibits offered by MFP (MFP Exhs, 155, 156) were the NCR and LER concerning a reactor trip occasioned by low steam generator level that occurred on February 1,1991. A carpenter was carrying planks intending to erect a scaffold for inspection and repair of a feedwater valve. The planks struck an instrument air valve, closing it and shutting off the operating air supply to two feedwater valves and their bypasses. He feedwater valves failed closed, the feedwater supply to two steam generators ceased, the steam aenerator level dropped, the neactor tripped on low steam generator level and steam flow /feedwater flow mismatch and the turbine tripped. MFP Exhs.155 at 2-3,156 at 1; Tr.1692-93 (Giffin). When the reactor trip and turbine trip occurred and the plant transferred from its own generated power to outside power, four pieces of equipment failed to operate: a circulating water pump failed to restart, a 25 kV motor-operated disconnect failed to open, a control rod drive mechanism cooling fan failed to 264 I i

p V start, and a main turbine stop valve failed to close fully. MFP Exhs.155 at 3-4, 156 at 3-5; Tr.1694-95 (Giffm). PG&E's safety analysis of the event indicated that such a string of failures was, in fact, bounded by previous analyses and that the health and safety of the public was not adversely affected. MFP Exhs. L 155 at 8,156 at 9-10. The cause of each of the four subsidiary failures was identified: the circulating water pump failed because of a malfunctioning relay n !(d? (Vosburg)), the 25 kV disconnect failed because outage workers had wrapped plastic si. eting around one of its operating shafts, the control rod drive cooling fan failei because of temps ;ure and age-induced changes in its magnetic starter, and tce main turbine stop valve failed to close because of underlubrication of a bt thing on its actuator spring. MFP Exhs.155 at 3-4, 156 at 4-5. Corrective ac ions were taken to prevent recurrence of the initiating event, including a revision of the procedure governing erection of scaffolding. I Corrective actions were also taken to forestall recurrence of the subsidiary events. i MFP Exh.156 at 11-12; Tr.1693,1702 (Giffin); Tr. 1699,1701 (Vosburg). MFP would have us find that this incident represents another case in which - multiple maintenance deficiencies occurred and previous corrective actions were ineffective (MFP FOF 1 693 at 248,702 at 251). It would also have us find that the incident presents " substantial and multiple inadequacies in PG&E's maintenance and surveillance program"(MFP FOF 7(M at 252). PG&E would have us find that this was an isolated event, that it has been adequately addressed to minimize future occurrences, and that it is an example of how a "living" maintenance piogram incorporates operating experien.: a order to improve. PG&E FOF t1M A209 through M-A21I at A-84 through A-85, citing Tr.1694-96 (Giffin),1700 (Vosburg). PG&E sees no programmatic concerns stemming from this incident. PG&E Reply FOF R-Al20 at A-55 through A-56. The Staff, too, sees this as an isolated incident that has been properly resolved and that has actually resu' icd in enhancing the maintenance program. Staff FOF I-275 at i10. In this instance we agree with PG&S and the Staff. We see this as an incident in which a virtually unforeseeable random event with no serious safety implications has resulted in a thorough and intensive analysis, ultimately improving the maintenance and surveillance program.

40. Arailiary Saltwater Pump Crosstie 1*alve MFP presented an exhibit (MFP Exh.168) in which was described an incident where an auxiliary saltwater pump crusstie valve was found with its manual handwheel inoperable because of extensive rust buildup. MFP points out an ostensible inconsistency in the testimony of PG&E witnesses concerning the safety status of this valve and its capuity for manual operation (MFP FOF 1705 at 253). It contrasts the statements of witnesses Giffin and Ortore (Tr.

t 265 4 l i I i J

{L 1725) to the effect that the function of closing the valve is not safety significant with that of witness Vosburg (Tr.1718) that the closing of the crosstie valve is a safety function. .We see no real inconsistency. Witness Vosburg merely testified that the design of the system takes account of the manual operation capability of the valve in order to make it unnecessary to design the remote operator to Class I (safety grade). Witnesses Ortore and Giffin noted that the entire capacity of the valve to be operated - both electrical and manual - is itself Class II because operation of the valve is not required for mitigation of an accident. (The body of the valve is Class I since it is part of the primary pressure boundary.) p MFP's own exhibit shows that the operating capability is only needed if, at a time some 13 hours after an accident, it becomes necessary to separate two redundant t, rains of auxiliary saltwater cooling in the event that a leak develops l in a passive component of one of the two trains (MFP Exh.168 at 7 8), and the manual operator would be needed only if the electrical operator simultaneously failed. A second valve in series with the valve whose manual operator failed was available in any event, and although that valve's manual operator was clogged with paint it was quickly and readily freed for service. Id. at 3-4,15-16. The maintenance program has been changed to require inspection of these manual handwheel operators. Id. at 18-19; Tr.1730 (Giffin). MFP would have us find that the failure to include regular inspection of the handwheels in the original maintenance and surveillance progr.im " reflects a basic inade.juacy in the program"(MFP FOF 1706 at 2:4). decause MFP's own exhibit concludes that, even with the valves in the condition found, "the ASW system would have functioned as designed to support post-accident operation" (MFP Exh.168 at 8), we cannot agree with MFP on this point. Clearly the analysis and review of the incident has improved the program, but clearly also it was adequate before the incident occurred. MFP makes a second point: that the response to the original discovery of the stuck handwheel was intolerably tardy (MFP FOF t 715 at 257, 722 at 259). This is because, while the flaw was discovered in June of 1990 and an attempt was made to correct it in September of 1990, actual repair was not accomplished until the NRC resident inspector called the outdated repair tag to the plant manager's attention in January of 1991. It appears that the first attempt to correct the situation wa3 abandoned because plant management knew that spare parts were not available and was reluctant to disassemble the valve without such parts. MFP Exh.168 at 2-3. We have no record evidence of the time needed to Fet spare parts for such valves, so we cannot judge whether the period was too lonF or not. Certainly the fact that the valve was ultimately i repaired without spare parts suggests that a sufficient effort could have fixed it more quickly. Nevertheless, we see no serious programmatic fault in PG&E's behavior in this instance. The matter was a flaw in a system that was not directly O

n safety-related, there existed adequate redundancy during the period before repair, and PG&E has taken adequate steps to prevent recurrence. t 41. Testcock Valve on Diesel Generator MFP introduced an exhibit (MFP Exh.172) that concerned the failure of _ a testcock valve on a diesel generator. This exhibit describes the following occurrence: Maintenance was being performed on a diesel generator, and a testcock, a device to permit checking cylinder pressures, had been replaced. Mechanical Maintenance performed an initial leak check on the testcock, and the engine was run to bring it to operating temperature, when another leak check was to be performed. When Mechanical Maintenance tried to perform this second check, the mechanic inadvertently checked and tried to tighten a testcock other than the one that had been replaced, and that testcock broke off. Analysis and investigation revealed that the broken testcock had failed because of high cycle vibration fatigue caused by loosening in service. Id. at 2-3,5; Tr. 1746-47 (Giffin). MFP would have us find that the degradation of the broken testcock was identified because of an error in post-maintenance testing (MFP FOF 1726 at 260), and that seems true enough. But MFP would also have us find that, when taken in conjunction with the incident of the failed motor operator keys described above, this, being a second instance wherein a flaw was discovered when a maintenance worker made an error, indicates s me basic infirmity in the maintenance program. MFP FOF 727. That we cannot find. Both the Staff and PG&E would have us find that this is a very minor incident with no real bearing on the fundamental soundness of the PG&E maintenance and surseillance program. Staff FOF 11-286 at i13: PG&E FOF 1M-A219 at A-87. We note that, even had the damaged testcock gone undesceted and broken off while the diesel was running, it would not have caused the diesel to fail its intended function. Tr. 1749-50 (Giftin). This, even taken with the matter of the failed motor operator keys, is surely no indicator of any si nificant flaw. F

42. Main Fredwater Check Valve Ibur of MFP's exhibits (MFP Exhs. 190. 191, 192, 193) allegedly relate to the malfunction of a main feedwater check valve at Unit 1. Although it appears to the Board that'three of the four documents (MFP Exhs. 191, 192, 193) involve that valve only peripherally, we ne considering them together in order to correspond to the treatments given in the proposed findings of the parties.

267

l Re first document reports the finding of a condition of leakage in a main feedwater check valve and the considered decision, based upon evaluation of the safety significance of this leakage and upon the fact that operators could readily take account of the condition of the valve, that there was no need to repair the leakage immediately. De fundamental cause of this leakage was a failure on the part of the valve's vendor to make clear the proper procedure for reassembling the valve aftet servicing. Dat problem has been corrected. MFP Exh.190 at 2,5-9. De subject matter of the other three exhibits (MFP Exhs. 191,192,193) was PG&E's treatment of, and response to, an ac:uation of the P-14 ESF at Unit

1. Hat actuation occurred at a time when the feedwater check valve was still leaking, and it was at first thought that that condition might have contributed to the event, but later analysis showed that the check valve leakage did not really contribute. MFP Exh.190 at 3; Tr.1781 (Vosburg). He ESF actuation was primarily brought about by leakage through the main feedwater control valve and its bypass valve, both of which malfunctioned because of a drift in the valve position controller. MFP Exh.191 at 5. That condition has been corrected by increasing the frequency of surveillance of the position controller's condition.

Tr.1783 84 (Giffin); 1786 (Vosburg). The P-14 interlock trips the main feedwater pump and the turbine and closes the main feedwater isolation and regulating valves in order to protect the turbine from damage by water intrusion. MFP Exh.192 at 4-5: Tr.1773 (Vosburg). MFP woulo have us find that inadequate mmmena te,: was performed on the main feedwater check valve duiing Unit l's third refueling outage (MFP FOF 1735 at 263). That is apparently correct. As we have noted above, the material supplied by the vendor of the valve apparently did not contain adequate instructions for its proper assembly after servicing. That matter was corrected, and it apparently did not lead to any serious consequences. Further, careful safety analyses showed the leakage would not lead to any serious safety problems. MFP Exh.190 at 6-8. As to MFP's proposed finding that PG&E's response to j the leakage was untimely (MFP FOF 738 at 264), we see no reason to fault the management decision to leave the leakage uncorrected. MFP would also have us find that poor communication played an important part in the series of events herein described, inasmuch as MFP believes that no proper notification was given tr.he reactor operating staff that leaky valves might occasion trouble during a startup. MFP FOF 743 at 265, citing MFP Exh.193 at 1. The NRC comment that MFP cites in support of this postulate is, in fact, apparently in para a simple misunderstanding of the role the check valve played in the P-14 actuation incident. Although we do not have the original report of that incident sent to NRC, the revision introduced shows, as we noted above, that the leaking check valve played little part in the ESF actuation. The valves primarily to blame for the ESF actuation were not known to be faulty at 268

I the time, No serious lack of communication between maintenance and operations is apparent to the Board here. MFP repeats that untimely action after the discovery of the leaking check valve was to blame for " numerous reactor trips, an ESF, and a degraded feedwater system." MFP FOF 11746-50 at 266-67. We see no instances here recorded where. leaking valves of any sort led to a reactor trip - the ESF occurred during recovery from a trip due to other causes (Tr.1781 (Vosburg)) - nor do we see a substantially degraded feedwater system. We see no evidence here of a significant deficiency in the maintenance and surveillance program. p r l

13. ASW Pump Vault Drain Check Valves 5:

MFP introduced an exhibit (MFP Exh.196) that describes an incident in which the check valves in both Auxiliary Saltwater (ASW) pump vault drains - were simultaneously removed for servicing. Because both chains of a redundant system were being worked on at the same time, PG&E witness Giffin, out of an abundance of caution, initiated the NCR process, but engineering analysis showed that the removal of the valves did not affect the operability of the ASW pumps and that the incident did not, in fact, present a nonconformance. Tr. 1795 96 (Giffin). Thus the document is not really an NCR, and, indeed, it contains within it the information that the incident was neither nonconforming nor reportable (MFP Exh.196 at 6-7,12). Nonetheless, MFP would have us consider ccrtain findings in the report as matters that reflect adversely upon the maintenance and surveillance program of the DCPP. MFP F0F 1754 at 268, citing MFP Exh.196 at 5-6; MFP FOF 1755 at 269, citing MFP Exh.196 at i1. Both the Staff and PG&E would have us find that, inasmuch as the report does not suggest any hazard to the public health and safety (indeed, it specifically discounts any such hazard (MFP Exh.196 at 6)), and because it is not actually an NCR, it cannot lend any support to MFP's contention that the maintenance and surveillance program is flawed. PG&E FOF M-A233 at A-92 through A-93; Staff FOF 1-296 through I-297 at 116-17. Although we cannot endorse the reasoning of PG&E and the Staff in this - clearly, a recounting of an egregious failure of the maintenance and surveillance program, whether in an NCR or elsewhere, whether it directly hazarded the public health and welfare or not, could cast doubt on that program - we find, after carefully considering the matters MFP has pointed out, that none of them rises to the level of a significant challenge to the program. I 269 j i l I l I i

gg-s l; -<[, ,~ c 1 ' 44. Motor-Operated Valve Failed to Cycle on Actuation Signal j I MFP introduced an exhibit (MFP Exh. 210) concerning a motor-operated safety injection valve that failed to cycle closed and open when tested. He valve i opened pmperly on a signal to do so, then closed on a signal to close, but failed to open a second time on 'a second attempt to open. Investigation revealed that - l

the operator's declutch fork had been installed upside-down during maintenance' 8 years previously, prior to the start of plant operation, and that t' e excessive-h stresses induced by this improper installation ukimately caused the failure. Id.

at 2-3. MFP would have us find, by a tortuous chain of reasoning interpreting 10 O C.F.R. Part 50, App. A, that this chain of events violated the so-called " single 3 failure criterion" (MFP FOF 11762 and 763 at 271-72),' and it would have us ' i ' find this despite the fact that the valve in its as-found condition would have. operated in an emergency. MFP Exh. 210 at 5; Tr.1809-10 (Octore). 3

We note that, at the time the erroneous installation of the clutch fork occurred, the maintenance instructions and training were not equivalent to.

. present standards. MFP Exh. 210 at 6; *11.1810 (Ortore). MFP would further have us find that this is a case wherein a " deficient -i ' installation went undetected until the component failed..." MFP FOF1764 at 272. We note that in fact the failure was detected by a routine surveillance - -intended to detect just'such failures, and that during the eight. year period the. valve was regularly tested and performed as it should have. Tr.1810 (Ortore). We see this occurrence as an isolated instance that 'tas been dealt 'with properly, an instance that does not suggest a significant flaw in the maintenance - and surveillance program. 3 i i

45. Fire in Electrical Panel MFP introduced an exhibit describing the occurrence of a fire in an electrical panel. The fire was discovered both through the activation of a smoke detector annunciator and by a mechanic's helper who saw smoke and spread the alarm.

j The fire brigade responded and soon extinguished the fire. The damage was j such that the exact cause of the fire could not be determined, but analysis y 1 by knowledgeable people led to the conclusion that the fire resulted from - __ over eat ng o a oose term na on a 480-volt breaker. It was further believed h i f l i l that the terminal was loose because the termination was of the u ;.pression type, a type that is dependent upon the skill of the installer far acceptable results. MFP Exh. 216 at 1, 2, 4, 6. He exhibit notes that such terminations were replaced in the 1970s on Class I high-voltage equipment, but that a " conscious, economic decision" was made not to replace them on Class 11 equipment, a condition that accords with accepted IEEE practice. MFP Exh. 216 at S. i f 270 g. 1l 1 a l 'f i l - _]

Tj 4 g s e L MFP would have us find that PG&E's behavior in this instance is a case N I _ of putting financial considerations above safety 'and hence shows that financial _ considerations have undermined the. maintenance and surveillarce program at DCPP. MFP PDF11767-768 at 273-74. It does not seem so to us. The financial consideration led only to economizing on nonse.fety matters. _Indeed, the panel i that failed "has no effect on the safe shutdown capability of either unit.",MFP Exh. 216 at 6. Improved terminations have been installed and a system of,. infrared thermography inspections has been instituted to reduce the probability 'of recurrence. Id. at 7; Tr.1823-24 (Crociett). We see no basic flaw here. i 46. Chemical and Volume Control System Diaphragm Leakage - MFP cross-examined PG&E's witnesses on cmtain instances of leakage from valves in the Chemical and Volume Control System (CVCS) of the plants. Tr. 1826-39; PG&E Test. at 100 02. To clarify matters addressed in that testimony and cross-examination PG&E introduced two exhibits (PG&E Exhs. 28,29). f Although the technical specification for leakage from the CVCS was exceeded i in each case, careful analysis concluded that there was no effect on the public health and safety, inasmuch as the leakage limits are set by consideration of the i doses in the control room and at the site boundary over the entire 30-day course l of a very severe accident. PG&E Exhs. 28 at 5-6,29 at 4-5. nese two instances of leakage occurred in 1991 and 1992, but they stemmed i from different soot causes and the precautions tak n 10 prevent repetition of the t first occurrence would not have prevented the second. Tr. 1832-33 (Giffin). MFP would have us find that multiple deficiencies led to these incidents and that "this broad array of deficiencies implicates the overall adequacy of PG&E's - maintenance and surveillance program." MFP FGF 1784. We do not agree. He incidents of leakage stemmed from different causes, those causes were in each instance carefully analyzed, and proper steps were taken to improve the program. 4 PG&E Exhs. 28 at 6, 29 at 5; Tr.1831-33 (Giffm). We see no indication in these events that the maintenance and surveillance program is seriously flawed. H. Conclusion on Maintenance and Surveillance Program . e began our discussion of the Maintenance and Surveillance P gram with W the general conclusion of the Staff witnesses that the program was adequate

j and, indeed superior. We then tested this overall general conclusion against the incidents cited by MFP.

%ere is additional testimony and other evidence dealing with a general .j evaluation of the Maintenance and Surveillance program and how it compares to other such programs throughout the industry. PG&E performs approximately 271 1 9 l I i 1 l I

14,000 preventive maintenance tasks and 7,000 corrective maintenance tasks annually at DCPP. PG&E Test. at 38, 40 (Ortore). The incidents referenced by MFP, some of which (as detailed above) are quite serious, represent but a small percentage of those tasks. PG&E claims, and we have no reason to doubt, that the nonconformances, although typical of the range of matters that confront the maintenance and surveillance system, are "not the normal. They're the exception of how we do business." Tr. 2072 (Giffin). Collectively the incidents demonstrate that PG&E has not reached perfection - but no one (including MFP) expects that it would or could do so. As a PG&E witness observed, "we are not perfect. We would like to be, but we're not." Tr. 207I (Giffm). Clearly perfection -in context, " error free maintenance"- is not required to provide the " reasonable assurance" necessary for us to approve the license extensions here sought. Tr. 2275 (Peterson). Compared with nuclear power plant industry norms, however, PG&E ranks quite favorably. The NRC has frequently commended PG&E for achieving a high level of safety performance at the DCPP. PG&E Exh. 49 (NRC commendation letters dated June 22,1993, February 5,1993, June 30,1992, and February 3,1993). Moreover, the Commission periodically conducts a Systematic Assessment of Licensee Performance (SALP) which, in effect, evaluates the performance of operating reactors in specified disciplines, one of which is maintenance and surveillance. PG&E Test. at 182-83 (Giffin). Ratings are currently categorized into three levels - 1 (" superior level of safety performa..e"), 2 (" good level of safety performance"), and 3 (" acceptable level of safety performance")." ihr the most-recent SALP review period as of the time of the hearing (from July 1,1991, through December 31,1992), PG&E received six "1" ratings and one "2 and improving" rating. Maintenance and surveillance received a "1" rating. PG&E Test. at 183 (Giffin); PG&E Exh. 20. A plant need not receive a "1" rating to qualify for a license extension of the type sought here - indeed, a "3" rating would be sufficient. Tr. 2275-76 (Peterson). In addition, PG&E presented the opinion of Tedd A. Dillard, a maintenance expert employed as Supervisor of Component Programs for the Nuclear Division of Gorida Power & Light Company (FP&L) and, previously, from May 1983 to November 1988, the Manager of Maintenance for FP&L's St. Lucie Nuclear Power Plant. PG&E Test. at i16. Mr. Dillard testified (as had other PG&E witnesses) that excellence in operating records of a plant directly stems from an adequate maintenance and surveillance program and that PG&E's record in "NRC Managemen* Directives sistent Handtwk 8 6. Pan t. approsed July 14.199.4. at 6 (replacing former NRC Mamial Charier and Appenda 0516L referenced in PG&L Test at 18M6 IGiffint A fourth category 4"N") represents funcuonal areas for which msuffieserit information ents:s to support n assessment of licensee performance. llandbook 8 6 at 7 272

v.:g i' ..s this respect is among the leaders in the nuclear industry. The Staff expressed a similar view. Notwithstanding such accolades, MFP has brought to our attention several aspects or areas of the maintenance and surveillance program that warrant some corrective action. We commend MFP for its efforts in this regard. Although not sufficient to warrant denial of the license application, they are sufficient to warrant orders for correction. Specifically, we direct the following corrections: 1. The telatemp sticker program must be improved, as described under item IV.C.I. above. 'Ihese improvements need be made only to the extent PG&E determines to use such a program in fulfilling its EQ requirements. 2. Conversion of the radiation monitoring system must be completed and a set of rules for working on energized equipment be promulgated (item IV.C.38, above). 3. PG&E must undertake a study, to be submitted to the Staff for review, concerning methods for improving communications between maintenance and - other departments, to the extent maintenance elects to use those departments in. implementing its maintenance and surveillance program (see items IV.C.9,10, 15, 29, 34, 36, 37). We delegate scheduling and confirmation of satisfactory completion of these matters to the NRC Staff. Such delegation of post-hearing matters is appropriate where, as here, they involve deficiencies that should be corrected but which do not pertain to the basic findings necessary to the issuance of a license. Public Service Co. of New Hampshire (Seabrook Station, Unit.s I mnd 2), CLI-90-3,31 NRC _19, 230-31 (1990); Conwlidated Edison Co. of New York. Inc. (Indian Point, Unit 2), CLI-74-23,7 AEC 947 (1974). V. RENEWED SlOTION TO REOPEN Tile RECORD MFP's August 8,1994 Renewed Motion to Reopen the Record seeks to include in the record on Contention I an NOV issued by the NRC Staff on July 14, 1994, together with various materials included in two inspection reports dealing with the subject of that violation as well as with certain other matters covered in those reports. The motion is opposed by both PG&E and the NRC Staff. Such motions are governed by 10 C.F.R. 6 2.734, which requires tlu a motion to reopen a closed record be timely (except in circumstances not here pertinent), that it adJress a significant safety or environmental issue, and that it demonstnte that a materially different result would be or would have been likely had the newly proffered evidence been considered initially. Further, the motion must be accompanied by one or more affidavits. 273 ] i i l la

l v. e. y MyGM-. *

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A s $eb 3 e q ?: b%, - .l' + y 3, + 1_ t a 1 ga; ~ il _ us a ...m; m m d gJ On' July,22,1994l the' Staff advised the Board and parties of the issuance - , j

of the NOV, Letter from NRC Staff counsel to Licensing Board,' dated July..

• • " v' 122,i1994, transmitting copy of NOV dated July.14,1994i The NOV,covere s

D,

• " letter to PG&E, dated ' July 14, 1994, characterizes the NOV (based on_ IR 94 ~

~ ' 08) as "a significant violation involving the failure of your engineering staff a f ito fully recognize or correct operational deficiencies in the Auxiliary SaltwaterT -(ASW) System,;despite several opportunities to recognize the existence of these. 'i "5 deficiencies.")* i p J'Ihc letter went on to note that NRC had also c. ~. ~' . considered separate citations for failure to implement adequate design control measures to assure that ASW speciAcanons and procedures were adequate to properly hmit maximum - Component Cooling Water (CCW) temperature during a design t' asis accident, and for failure ' d Z _ to provide complete and accurate information to the NRC regarding the msults of ASW l ) ~

system testing.

U The NRC explained that those failures were a " direct consequence of the poor ' engineering work" and, as a result, " separate citations are not warranted." NRC - ~ - Letter to PG&E, dated July 14,1994, .j In its Reuewed Motion, MFP notes that it previously had sought to reopen. .the record to introduce IR 93-36 (January 12,-1994), to demonstrate that the - 3 surveillance program for the AS,W system was inadequate and PG&E failed to -} perform needed maintenance, and that in LBP-94 9 we dismissed'the motion. ~ without prejudice because the issues raised were as yit " unresolved." In that ,j L Order, we also established a threshold showing for any renewed motion, that - ' the information be demonstrated _as "significant and. possessing substantive' ] l implications with respect to implementation of the maintenance / surveillance - program" at DCPP. L13P-94-9,39 NRC at 125 (footnote omitted). MFP characterizes the NOV as confirming the existence of problems initially l raised in IR 93-36. MFP goes' on to claim that the motion.is timely filed, that it raises significant safety and environmental issues, and that it is likely to j affect the outcome of the case relative to Contention I "because it contradicts / testimony at the hearing by PG&E and the NRC staff and because it corroborates ii = many aspects of [MPP's] position that PG&E's maintenance and surveillance . program is inadequate?'. MFP adds that "the fact that PG&E appears to ' have misrepresented the operabihtyof the ASW system and the status of its ' maintenance and surveillance program implicates the integrity of PG&E's entire. .i maintenance and surveillance program and the reliability of PG&E's testimony j in this case." Renewed Motion at 3. I 7 'The Staff tranmuned copies of IR 94-08 to the Board and parues t*y Memorandum d.ned March li.1994, 3 3., (Board Natifwation 94-06). I-! . 274' i .I r i 3 i D D i .i -i '{ ,on c, e e s *-, .e.-- nww. .e, e

t PG&E and the Staff do not contest the timeliness of the Renewed Motion, at !?ast insofar as it seeks to add the NOV to the record. (They question the timeliness of other matters arising from IR 94-08.) Nor at this time do they contest the safety significance of the cont:ntion to which the new inspection findings may be relevant. Rather, they question the significance and indeed relevance of the " engineering" matter to the maintenance and surveillance contention. Tney mention PG&E's August 11, 1994 response to the NOV, 3

i,cluding corrective actions to prevent recurrence (copies of which were included i

in PG&E's response to the motion) and hRC's acceptance of that response (also included in PG&E's response to the motion). They also each stress that the matter addressed in the NOV was an engineering performance issue, not a maintenance, surveillance, or equipment operability issue and thus has little bearing on Contention I. 7 Finally, tl.cy argue that the other issues that MFP attempts to raise were derived from IR 93-36 but were closed out by the Staff in IR 94-08, without giving rise to any enforcement action. They thus assert that MFP's motion does not meet the threshold established in LBP-94-9 for reopening the record. In support ofits respanse, PG&E presented the affidavit of Michael J. Angus, PG&E's Manager of Nuclear Engineering Sersices, who is responsible for overall management of PG&E's engineering support and design engineering activities at DCPP. He affirms that, with the exception of the one NOV, all inspection issues cited in the Renewed Motion have been closed out. He also describes the limited scope of the NOV and the method.f cesolving or closing out the other issues derbed frora IR 93-36 that were raised by MFP. For its pan, the Staff's response included affidavits of three of the witnesses who appeared before us during the evidentiary he. ring - Paul P. Narbut, Sheri R. Peterson, and Mary H. Miller. Most important, Mr. Narbut, the Staff Senior Inspector who was the author of both IR 93-36 and IR 94-08, confirms that PG&E has a sound maintenance and surveillante program and that he does not have any " current concerns" for the operability of the ASW system. He expresses his belief that PG&E has shown that the ASW system was "at all times operable" and that it "has done a credible job of addressing my technical and management inspection issues." He also describes a number of technical inadequacies and factual enors in the Renewed Motion. For their part, Ms. Peterson and Ms. Miller reaffirm their earlier t~'imony that PG&E's maintenance and surveillance program is clearly supportive of safe facility operation. They too differentiate an a ngineering deficiency from a deficiency in the maintenance and surveillance p.ogram. They note that the single violation does not equate to overall inadequate performance and that it would be taken into account in future SALP esaluations. Ms. Miller explicitly states that "[t]he fact that specific problems and findings were identified is not unusual or unexpected and is not inconsistent with NRC's SALP evaluation." 275

) t c 1 b r 1 Affidavit of Mary H. Miller in support of NRC Staff Response to MFP's Renewed Motion to Reopen the Record, dated August 25,1994, at 5. In reviewing the motion, we must recognize the rigorous standards that the Commission has imposed to warrant reopening of a closed record. And we find t that those standards have not here been satisfied. First, we agree with MFP that the NOV concerning engineering activities is L sufficically related to maintenance and surveillance of the ASW system to be F within the scope of Contention I. We are unwilling to thrust the violation into a separate organizational box in order to dispose of it artificially on that basis. Instead, we view it as another aspect of the relationship between maintenance and engineering that is included in the INPO definition of maintenance that we adopted as a guideline earlier in this Decision. Further, a Severity Level III violation is also significant enough to constitute information pettinent to the contention and to satisfy that aspect of the reopening criteria. Finally, the Renewed Motion was clearly timely filed, at least insofar as it was based on the NOV. We are denying the Renewed Motion for one basic reason: the proffered information could not result in a different decision hom the one we otherwise are reaching. The NOV undoubtedly constitutes a " black mark" on a 3&E's record, comparable in some respects to the CFCU matter. Cf Tr. 2214 (Miller). 'Ihat incident was taken into account in NRC's SALP evaluation, but it did not preclude PG&E from receiving a superior rating. h the SALP report, it was deemed to be "an isolated example (that] didn't really was ant a programmatic problem." Tr. 2215 (Peterson). In the words of Ms. Miller, "[i]t's possible to have superior performance and not be perfect." Tr. 2166 (Miller). On the basis of the Staff affidavits submitted in response to this motion, we view this NOV similarly - a deficiency that, particularly with respect to maintenance and surveillance, does not reflect a programmatic inadequacy. By the same token, based on the Staff affidavits, none of the other matters arising out of irs 93-36 or 94-08 warrants reopening of the record, either separately or as a group (even considered in conjunction with the NOV). None has thus far resulted in escalated enforcement action by the Staff, although several " apparent violations" were still under review as of the time IR 94-08 was issued. In the context of licensing rather than enforcement sig..Taance, and of Contention I in this proceeding, the most serious apparent violation is the failure to provide complete information to the Staff. As set forth in IR 94-08, the inspector concluded that the beenhee failed to pro ide cornplete and necurate informahon to the NRC in regards to the CCW 12 heat enchanger's abihty to meet the design basis heat load This failure is considered an apparent violation ( Apparent Violation 50 275N4-08 02t 276 r I I

t inspection Report 50-275/94-08; 50-323/94-08, Details at 5. According to Mr. Narbut, this " apparent violation" concerns " failure to report material details, i.e., incompleteness" of a report, not " misrepresentation" as characterized by MFP. Narbut Affidavit 12. Signaicantly, the Staff has not issued an NOV on this matter and thus does not seem to deem it significant enough to warrant further enforcement action. As set forth by Ms. Miller, PG&E's " integrity in responding to maintenance problems.. is not raised in the NOV, nor is... integrity considered a concern." Miller Affidavit 9. We conclude that the incident cited by MFP (either alone or in conjunction with the other matters raised by the mMion) could not alter the result we are reaching and the motion is therefore being denied. VL CONTENTION V (Thermo-Lag Interim Compensatory Measures) Contention V, as initially submitted, read as follows: It is the contennon of the San Luis Obispo Mothers for Peace that the Thermo Lag tnaterial fails as a hre barrier and, in fact, poses a hazard in the event of a hre or an earthquake. Unnt j this situanon is adequately rewived. the license for Diablo Canyon Nuclear Plant certainly j should not be extended. T LBP-93-1. 37 NRC at 26. The:mo-Lar is a fire barrier material that ha> been us :d at DCPP. Recent l testing of nermo-Lag material has raised questions as to its ability to perform satisfactorily as a fire barrier for the rated durations specified for certain applications. The problem with Thermo-Lag fire barriers is generic in the [ nuclear power plant industry because a majority of nuclear power plants have used the material to satisfy NRC fire protection requirements. The asserted deficiencies with Thermo-Lag are that (1) Thermo-Lag fire barriers may not provide the fire resistance necessary to satisfy NRC fire protection requirements; (2) Thermo-Lag may burn more readily than originally believed; and (3) the ampacity derating factors used by licensees to derate power cables may not be great enough to account for the insulating effects of the Thermo-Lag material. PG&E Test., ff. Tr.1277, at 3,4: NRC Staff Test., ff. Tr.1417, at 2 (Madden). The NRC has issued a series of I..Drmation Notices regarding deficiencies found in Thermo-Lag 330 fire barrier material. Additionally, it has required that nuclear power plants implement interim compensatory measures, pending determination by the Stalf of possible additional corrective steps that may be required. See NRC Bulletin 92-01 (6/24/92) and Supplement I to NRC Bull.' tin 92-01 (8/28/92). PG&E's response to this NRC request is documented in a September 28. 1992 Response to NRC Bulletin 92-01, Supplement 1. PG&E Exh. 3. In this 277 I i

f h response, PG&E identified eleven specific nermo-Lag fire areas at DCPP that are subject to these interim compensatory measures. PG&E's compensatory measures include: (1) a roving fire watch where fire detection devices are ' employed; or (2) a continuous fire watch where fire detection devices are not available. Tr. 1287,1288 (Cosgrove, Powers). PG&E's interim compensatory measures have been accepted by the NRC Staff and documented in a letter dated - October 27,1992. PG&E Test., ff. Tr.1277, at 13: PG&E Exhs. 3. F 1. In admitting this contention, we limited it to the portion dealing with the adequacy of PG&E's resolution of the Then no-Lag issue. Specifically, we accepted the allegation that PG&E has failed to implement adequately and abide by the Commission's interim compensatory measures required for the use of nermo-Lag fire barriers. LBP-93-1, 37 NRC at 27-28, as clarified by " Memorandum and Order (Discovery and Hearing Schedules)," dated February 9,1993, at 2 (unpublished). The scope of this contention does not include whether fire watches, as a compensatory measure, are an adequate substitute for Hermo-Lag fire barriers declared inoperable. To reiterate, the sole issue is whether PG&E has adequately implemented and will continue to implement adequately the Staff approved compensatory measures at DCPP. Tr. 1297,1299, 1430; LDP-93-1, 37 NRC at 27-28, as clarified by " Memorandum and Order (Discovery and Hearing Schedules)," dated February 9,1993, at 2. As litigated, Contention V also does not concern inside-containment applica-tions (radiant energy shields) of Thermo-Lag material. Ir rejecting a late-filed contention in this proceeding, we specifically ruled that, am a result of PG&E's decision to replace %ermo-Lag material in this application with shields of a different manufacturer, the issue of radiant energy shields and the alleFation that the hermo-Lag material is itself a fire hazard in these applications no longer raised an issue creating a genuine dispute. LBP-93-9. 37 NRC at 444-45. With respect to this contention. PG&E offered testimony from David K. Cosgrove Supervisor of the Safety and Fire Protection Group at DCPP, and Robert P. Powers, Manager of the Nuclear Quality Services Department of PG&E's Nuclear Power Generation Business Unit. The NRC Staff presented testimony from Patrick M. Madden, Senior Fire Proiection Engineer, Office of Nuclear Reactor Regulation, and Mary H. Miller, Senior Resident inspector at DCPP. All of these witnesses werr well qualified for their testimony. MFP asserts that the interim compensatory measures have been irdeq"ately implemented and hence are ineffective. It advances essentially three reasons: (1) that PG&E has not demonstrated reasonable assurance that its interim compensatory measures can and will be reliably implemented until such time as the generic Thermo-Lag issue is resolved; (2) that inoperable fire detec-tionhuppression equipment, coupled with the failure by personnel to imple-ment or perform compensatory fire watches, compromises the critical detec, tion / suppression component of PG&E's defense-in-depth fire protection program 278 P

+ and jeopardizes the safe operation of the plant; and f3) that human error and inadequate understanding jeopardize the adequacy of PG&E's.mplementation of compensatory fire protection measures at DCPP, MFP FOF 11791,793,797. Only a moderate amount of Hermo-Lag is installed at DcPP. " Moderate" describes an insts.flation incorporating between 100 and 1000 square feet or between 100 and 1000 linear feet of fire barrier material. PG&E has already replaced the Thermo-Lag in the Unit 2 containment and has advised that it would replace all the %ermo-Lag in the Unit I containment during the refueling outage that was then scheduled for February 1994. NRC Staff Test., ff. Tr.1417, at 2-3 (Madde9). PG&E has utilized a roving fire-watch program throughout DCPP " essentially since Units I and 2 have been in operation." PG&E Test., ff. Tr.1277, at 6,7. )! Therefore, implementation of the fire-watch portion of the interim compensatory f measures required only that "the tour route [be] slightly modifi d to encompass [ the additional fire areas." /d. at 14. In response to a PG&E objection that auempted to limit inquiry into fire watches solely to those established for Thermo-Lag purposes, we ruled that "since the fire watch program is merely an extension of an existing program.. inquiry into potential deficiencies in the existing program, the fire watch proFram, [is] permissible

• Tr.1297.

We also ruled that inquiry into other aspects of the implementation of interim l compensatory measures (beyond fire watches) was permissible. That does not mean, however, that inquiry into all aspects of the fire tirotection program in all fire areas at DCPP is permissible, as claimeG by M1 P (MFP FOF 789). There must be a demonstrated relationship to implementation of the interim compensatory measures. MFP has specified a number of particular incidents or concitions that are said to demonstrate that PG&E is not properly implemen%ng the interim compensatory measures (MFP Exhs. F-I A, F-2, F-3, F-5, r.6). Most involve missed hourly or continuous fire warches, relating L fire watches initially established prior to the Thermo-Lag watches. We find these are relevant because of the adminisuative similarity between those watches and the Thermo-Lag watches. We will deal with each specifically. First, MFP cites an LER that reflects a 1991 Technical-Specification violation for failure to perform an hourly fire-watch patrol for areas that had inoperable fire barriers (not related to Thermo-Lag deficiencies). The fire wmh was not performed because the hourly roving fire watch was unable to exit from the radiologically controlled area of the plant and exchange duties with another fire watch in the turbine building. The root cause was determined to be a lack of adequate instructions to fire-watch personnel. MFP Exh. F-l. De next document is a 1992 LER representing a continuous fire watch missed through personnel error. Corrective acuon included clarification of procedures and additional personnel training. MFP Exh. F-2. 279 r I

The third document is also a 1992 LER reporting another continuous fire watch missed through personnel error. He sprinkler fire water to certain areas-was isolated in accordance with an equipmen' tagout request without the Shift Foreman noting that a continuous fire watch was needed. An hourly watch ended up patrolling in the affected area. He root cause was determined to be personnel error on the part of the Shift Breman, and corrective action included counseling the Shift Rreman and operators involved and issuing an Operations Coordination Instruction concerning emipment tagout requests affecting the fire protection system. MFP Exh. F-3. The incident did not involve a Thermo-Lag fire area. Tr.1330 (Cosgrove). He next document was also a 1992 LER, involving two separate events. In the first, fire detectors in a particular area were inoperable for more than an hour, with no compensatory measures in place. In the second, fire detectors in another area were inoperable for more than an hour without a continuous fire watch in place. Both events were attributed to personnel error. Corrective actions included revision of procedures, preparation of an incident summary outlining the events, and clearly stating the expectations for dealing with spurious alarms and enhancing on-shift training of plant operators. MFP Exh. F-5. He final document cited by MFP also concerned two events, occurring in late 1992. In the first, the fire detection computer was inoperable for more than an hour, without initiation of required compensatory measures. In the second, the fire detection computer also malfunctioned, but the malfun-tion was not detected until the following day. Consequently, the requ: rcd roving hourly fire watch was not instituted in a timely manner. (During investigation, PG&E discovered another computer malfunction.) The December 28,1992 LER reported that the investigation was still in progress. MFP Exh. F-6. None of these events involved Thermo-Lag barriers. Tr.1325 (Cosgrove). PG&E maintains that, since the initiation of the interim compensatory mea-sures for Thermo-Lag tire areas. it has successfully completed 1007c of the hourly fire watches. PG&E FOF T23, citing PG&E Test., ff. Tr.1277, at 14-15 (Cosgrove, Powers), and Tr.1320 (Powers). It defines a successful tour of Thermo-Lag areas to be one entry into the defined area within the appointed hour and concludes that the interim compensatory measures have been success-fully implemented. PG&E F0F T23, citing Tr. 1307-08 (Powers). The Staff aFrees. Staff FOF 1 V-30, V-54. MFP does not dispute the record concerning Thermo Lag watches but continues to assert that the other record is more rep-resentative. Although we agree with MFP that the various missed fire watches are relevant for evaluating the likelihood of missed Thermo-Lag watches, we do not regard PG&E's overall record as flawed or as posing a threat to the adequacy of its compliance with fire-protection requirements. P sons for various missed k 280 i 1

c t r, + m.& l [ L watches have been identified, and PG&E has taken adequate steps to prevent . their recurrence. 4 During the hearing, the Board also explored claims to the effect that PG&E m had improperly altered the records of fire watches (Tr. 1282-87, 1322-24, 1389-M 1409 (Cosgrove, Powers)). No party has pursued that matter in its FOF, and we ' thus regard it as abandoned. l In short, nothing in the record would suggest that PG&E's implementation. of the Thermo-Lag interim compensatory measures was so flawed that license f ' denial (or even license conditions) are warranted.87 ? VIL CONCLUSIONS OF LAW !q The Licensing Board has considered all'of the evidence submitted by the . parties as well as the entire hearing record. That record consists of the . Commission's Notice of liearing, the pleadings filed herein, memoranda and- [ - orders issued in this proceeding, the transcript of the hearing, and the exhibits .j received or deemed to be received into evidence. Based on the findings of fact set forth in Parts IV and VI, above, which are supported by reliable, probative and substantial evidence as required by the Administrative Procedure Act and 1 the Commission's Rules of Practice, we conclude that: { l. PG&E has met its burden of proof with respect to both Contention I t (subject to certain limited conditions) and Contention T. { 2. With respect to the matters placed in controversy by these two con-i tentions, and subject to the limited conditions set forth with respect to Con-1 tention I, there is reasonable assurance that: (a) 'he Diablo Canyon Nuclear "I t Power Plant can and will be operated without endangering the public health and safety for the requested 40-year operatinF life: (b) such activities will be con-1 ducted in compliance with the Commission's regulations; and (c) such activities will not be inimical to the common defense and security. [ 3. All issues, arguments, or proposed findings presented by the parties but .{ not addressed herein have been found to be without merit or unnecessary for -j this decision. } I i) 37 By letter dated March 0,1994, the Apphcant advsmed us that. as it amtified the siaff on rebruary 14. 1994. I "PG&E will complete repla6cment of the Thermo. lag s . as appmpnate wnh other hre systems by December I 31.1994 Compensatory nrasures win be manmamed as appropnai-for each Thermo Lag instalianon unul its t replacenrat is complete " PG&E tstler No. DCI. 94 034 mi 4 Alth th our resolution of Contemina V is not i based on this commumcation awhech as not m the record and has not been subject to cross exanunanonk we noie j that. when accomphshed. at would render Comemum V moot ) 281 I .I I i a .I i l r

J VIII. ORDER i Wi!EREFORE, on the basis of the foregoing, in accordance with 10 C.F.R. 6 2.760, it is this 4th day of November 1994, ORDERED: 1, The Director, Office of Nuclear Reactor Regulation, is authorized, upon making requisite findings with respect to matters not at issue in this Initial Decision, and subject to the conditions specified on pages 180-81 with respect to Contention I, to issue the amendment proposed by PG&E in its application of July 9,1992. 2. This Initial Decision shall become effective and constitute the final action of the Commission forty (40) days after the date of its issuance, subject to any review pursuant to the Commission's regulations. 3. MFP's Renewed Motion to Reopen the Record, dated August 8,1994, is hereby denied. 4. In accordance with 10 C.F.R. 5 2.786, any petition for review of this Initial Decision must be filed within fifteen (15) days after service of the decision. Any other party may file, within ten (10) days after service of a petition for review, an answer in support of, or in opposition to, the petition for review. The petition for review may be granted or denied in the discretion of the Commission, giving weight to the considerations of 10 C.F.R. 5 2.786(b)(4).$8 TifE ATOMIC SAFETY AND LICENSING JOARD Charles Bechhoefer, Chairman ADMINISTRATIVE JUDGE Dr. Jerry R. Kline ADMINISTRATIVE JUDGE i Frederick J. Shon ADMINISTRATIVE JUDGE Rockville, Maryland November 4,1994 38 in the near future. we shall auur transeryst rortections far the es,dennary heanng. 282

, n. I ,f'l ~ j.... l ^ 1 4 d 4 '). 4 . Cite as 40 NRC 283 (1994) ' t EP-94-36 f ' 2-fr-i - UNITED STATES OF AMERICA. ^^ ^ NUCLEAR REGULATORY COMMISSION - -{ [ ATOMIC SAFETY AND LICENSING BOARD E ( ! Sofore Adminletrative Judges: .k ..i - G. Paul Bollwerk, lit, Chairman ~' Dr. Charles N. Kolber - Dr. Peter S. Lam i i ti ' in the Matter of Docket No. 030 30485-EA (ASL8P No. 94-685-02-EA) (EA 93-284) H (Order Modifying and Suspending Syproduct Material License No. 37-28179-01) INDIANA REGIONAL CANCER ?> CENTER November 4,1994 U MEMORANDUM AND ORDER -(Approving Settlement Agreement and Dismissing Proceeding)

i.,

By immediately effective order dated November 16. 1993,. l the'NRC Staff suspended the byproduct materials license of the Indiana Regional Cancer Center i - (IRCC) that authorized IRCC to use omntium.90 for the treatment of superficial l E eye conditions. See 58 Fed. Reg. 61,932 (1993).' The order also modified the license to preclude Dr. James E. Bauer, the Radiation Safety Officer and the j sole ' authorized user listed in the license, from engaging in any activities under l the license! This proceeding was convened at the request of IRCC and Dr. Bauer to enable them to contest the validity of the Staff's order. See 58 Fed. { i Reg. 67,427 (1993). Now, by joint motion' dated October 28,1994, the parties request that we approve an October 28,1994 settlement agreement they have 283 l 1 3u

.p. provided and dismiss this proceedmg wnhout any findings on facts in dispute g among the parties or resolution of any disputes, other than those rulings alreac'y issued is this proceeding.' Pursuant to section 81 and subsections (b) and (o) of section 161 of the . Atomic Energy Act of 1954, 42 U.S.C. 55 2111, 2201(b), 2201(o), and 10 C.F.R. I2.203, we have reviewed the parties' settlement accord to determine whether approval of the agreement and termination of this proceeding is in the i public interest. On the basis of that review, and according due weight to the position of the Staff, we have concluded that both actions are consonant with the public interest. Accordingly, we grant the parties' joint motion to approve the settlement agreement and dismiss this proceeding. Ibr the foregoing reasons, it is, this fourth day of November 1994, OR-DERED that 1. The October 28, 1994 joint motion of the parties is granted and we approve their October 28,1994 " Settlement Agreement," which is attached to and incorporated by reference ;n this Memorandum and Order. 2. "Ihis proceeding is dismissed. 3. If this determination becomes final agency action because the Commis-sion declines review, see 10 C.F.R. 6 2.786(a), within seven days of the date of the rnemorandum from the Secretary of the Commission indicating that the Commission declines review, Staff counsel should advire the Board and the Office of the Secretary, in writing, whether the Staff j refers that the in cam-era Board and Commission record copies of the May 18,1994 "NRC Staff's f I I 3ra. e g. L.itP-9421. 40 NRC 22 (1994) 284 l 1

p lc p L ' Response to Board Order dated May 6,1994* be returned to the Staff or destroyed.2 THE ATOMIC SAFETY AND LICENSING BOARD l ~ G. Paul Bollwerk III, Chairman ADMINISTRATIVE JUDGE Charles N. Kelber ADMINISTRATIVE JUDGE Peter S. Lam ADMINISTRATIVE JUDGE - Rockville, Maryland November 4,1994 i I Copies of this Memorandum and Order are bemg sent thn dase to counsel for IRCC and Dr. Bauer by facsmule tranmession and in Staff counsel (without the accompanying attachrrent) by I.-mail transnussion through the agency's wide era network system 285 i

7g N.. f[ ATTACHMENT 1 - October 28,1994 ~ UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD in the Matter of ' Docket No. 030 30485-EA (EA No. 93-284) (Byproduct Material License No. 37 28179-01) INDIANA REGIONAL CANCER CENTER INDIANA, PENNSYLVANIA SETTLEMENT AGREEMENT On November 16, 1993, the Staff of the Nuclear Regulatory Commission (Staff) issued " Order Modifying and Suspending License (Effective immedi. ately)" to the Indiana Regional Cancer Center (Licensee). 58 Fed. Reg. 61932 '(November 23,1993) (Order). On December 2,1993, the Licensee and James ' E. Bauer, M.D., the Radiation Safety Officer and Authorized User listed on Byproduct Material License No. 37-28179-01 (strontium-90 license), requested i. a hearing on the Order. In response to the Licensee's and Dr. Bauer's request, an Atomic Safety and Licensing Board was established on December 14,'1993. 58 Fed. Reg. 67427 (December 21. 1993). The Licensee and Dr. Bauer deny that the strontium-90 license was violated. The parties to the above-captioned proceeding, the Staff, the Licensee, and. Dr. Bauer, agree that it is in the public interest to terminate the above-captioned proceeding without further litigation and agree to the following tenns' and conditions: 1. 7he Licensee agrees to voluntarily withdraw its request to renew Byprod-uct Material License No. 37-28179-01 (strontium-90 license) and request the termination of the strontium 90 license in accordance with 10 C.F.R.' 5 30.36 no later than January 16,1995. ~ 286 l _=

i.: f 2. The Staff does not intend to, and, consequently, agrees not to take any further civil or administrative enforcement action against either the Indiana Re-gional Cancer Center, under the strontium-90 license, or Dr. Bauer, other than the Order Prohibiting Involvement in NRC-Licensed Activities issued on May 10,1994 (59 Fed. Reg. 25673 (May 17,1994), based on (a) the same facts out-lined in the Order Modifying and Suspending License (Effective Immediately), dated November 16,1993 (Order) (58 Fed. Reg. 61932 (November 23,1994)); and (b) any other facts or assertions revealed as a result of the NRC's Office of Investigation's investigation (No. 1-93-065R) of the Licensee *s activities under the strontium-90 license. His settlement is limited to the above-captioned civil proceeding and does not preclude the government from taking any other non-civil action if deemed appropriate as a result of OI investigation No.1-93-065R. 3. The Staff, the Licensee, and Dr. Bauer agree that upon termination of the strontium-90 license in accordance with 10 C.F.R. 5 30.36, the provisions of section IV of the Order and the above-captioned proceeding would become moot. 4. He Staff, the Licensee, and Dr. Bauer agree that this Settlement Agree-ment does not constitute and should not be construed to constitute any admission or admissions in any regard by either the Licensee or Dr. Bauer regarding any matters set forth by the NRC in the Order. 5. The Staff, the Licensee, and Dr. Bauer also agree that the matters upon whict. the Order is based have not been resolved as a rc alt of this Settlement Agreement. His Settlement Agreement shall not be relied upon by any person or other entity as proof or evidence of any of the matters set forth in the Order. 6. The Staff, the Licensee, and Dr. Bauer shall jointly move the Atomic Safety and Licensing Board designated in the above-captioned proceeding for an order approving this Settlement Agreement and terminating the above-captioned proceeding. Respectfully submitted, Marcy L. Colkitt Marian L. Zobler Counsel for the Indiana Counsel for NRC Staff -- Regional Cancer Center and James E. Bauer, M.D. Dated at Rockville, Maryland this 28th day of October,1994 287

y-y i G l v LBP-94-37 Cite as 40 NRC 288 (1994)' l .! I ' '. l UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION l . i ATOMIC SAFETY AND LICENSING BOARD l Before Administrative Judges: ~ y: Peter B. Bloch, Chair Dr. James H. Carpenter Thomas D. Murphy i j Docket Nos. 50-424-OLA-3 - in the Matter of 50-425-OLA-3 (ASLBP No. 93-671-01 OLA-3) (Re: License Amendment; Transfer to Southern Nuclear) 4 GEORGIA POWER COMPANY, et at (Vogtle Electric Generating Plant, November 8,1994 Units 1 and 2) Applicant's motion for summary disposition is granted in part.~ After viewin li had j all evidence favorably toward Intervenor, the Board assumed that App cant license without appropriate written indirectly transferred control of its operatinF d j permission from the NRC However, the Board held that even if Licensee t d made such a transfer, that without more would not demo For transfer of the license to be restricted, Intervenor wouM need to show l conditioned. i i This could' t that the recipient of the license is lacking in character or ntegr ty,esentations to the il i be demonstrated in this case only by showing mater a m srepr l restricted to questions related to alleged misrepresentations.Th Motion for Summary Disposition of Intervencr's illegal Transfer of License d ' Allegations" (Motion). The consequence is that there will be a hearing limite to - p a 288 b t + 5 ?

,= i f /; r 1 p the issue of whether Georgia Power Company, et al. (Georgia Power) has misled ..the Nuclear Regulatory Commission 'with respect to the control of licensed - . operations of the Vogtle Electric Generating Plant (Vogtle). L ' INDIRECT TRANSFER OF CONTROL: - PROHIBITED WITHOUT WRITTEN CONSENT - A company must retain actual control of licensed activities. Even indirect

transfers of a license are prohibited. If all that was prohibited was a transfer of the right to controllicensed activities, then there would be no need to specify that

indirect" transfers also were prohibited. What is important is that the licensed entity, which has been approved by the Nuclear Regulatory Commission, should n not enter into a new relationship that permits individuals who are not included in the license to control licensed activities, directly or indirectly. , RULES OF PRACTICE:

SUMMARY

DISPOSITION; GENUINE ISSUE OF FACT Once Applicant has submitted a motion that makes a proper showing for summary disposition, the litmus test of whether or not to grant the summary disposition motion is whether Intervonor has presented a genuine issue of fact that is relevant to its allegation and that could lead to some form of relief. CHAR.ACTER AND INTEGRITY: TRANSFER OF A LICENSE; EFFECT ON TRANSFER In the case of a license amendment application that would result in the transfer of an operating license, the transfer may be restricted if the proposed recipient of the license is lacking in character and integrity. Not every previous defect on the part of the recipient would require that the license transfer be conditioned or denied. For example, merely showing that the license had previously been illegally transferred to the recipient would not har the granting of the amendment unless the illegal transfer was accompanied by material omissions of fact or misstatements to the Nuclear Regulatary Commission. INDIRECT TRANSFER OF A LICENSE: NOT PERMITTED; REALITY TEST A licensee may not transfer an operating license for a nuclear power plant either directly or indirectly. Even if formal authority is maintained in an acceptable form, if people not included in the license have substantial influence 289

r e i i. over the operation of the nuclear power plant, the omission of their names from the license may be improper. Only appropriate consent in writing by the Nuclear iu _ Regulatory Commission may validate an unauthorized transfer of influence to operate the plant. t i RULES OF PRACTICE: PROOF OF MISREPRESENTATIONS I for each allegation of a misrepresentation, the Board will need to know as . precisely as we can: (1) what was said, {2) in what cor. text the. statement j existed,(3) the proof that the statement was inaccurate or incomplete (4) when (if applicable) the statement was corrected, and (5) why we should be concerned about the length of delay between the statement and when it was corrected. This s will require proof of a time line of actual events, demonstrating not only that. they occurred but also when they occurred. . 'ne Board also will require that the proof offered will make some allowance for inaccuracies in expression, understanding, and memory. So the Board will l need to know also how much time passed before the alleged misstatement was j made. i RULES OF PRACTICE: BRIEFS; CifARTS FOR CLARITY It would be helpful to us if time lines and charts w re used to communicate i Intervenor's points clearly. Such simple and easy-to-grasp devices would bc appreciated in the filings of all the parties. -I MEMORANDUM AND ORDER (Sumscary Disposition: Illegal Transfer Allegation) { This Memorandum and Order Frants in part " Georgia Power Company's Motion for Summary Disposition of Intervenor's Illegal Transfer of License t . Allegations"(Motion).' The consequence of our decision is that we shall hold a i 3 The Mohon was 6ied August 24. 1994 on october 4.1994. Mr Allen L Moshaugh (inierwor) hied his -Ressmse to Cmwgra Power Company's Motmn for Sumnary thspouten rif Interveinw's Illegal Transfer of ticense Allegahon" (Respmse) on october 1, the Staff of the Nuclear Regulatory Cornnussion (Staff) Gled i ses

• Response in Support of Georgia PWer Company's Monon for Summary Dispouhon of the Illegal tjcense l

Transfer lasue." t on october 14. Cmwgia Power bled two animas. a "Mmum to senke Iniervenor's Response to Georgia Power's Motmo for Summary Dispnunon" (Mnemn to sinke) and a "Motmn for twe to rile a Reply to intervenor's Responie to emwgta Pimer's Monon for summary thsposmon tillegal LJcense Transfer)"(Munun to Respond) i The Motion to Respond was accompamed by a reply on ociober 26, 1994, intervenor 6ied a -Response to GeorFia Power's Molmn so Smke intervenor's Resptmse in Sununary Dispouuun " (Camunued) l I t 290 ^ i r 5 T s

p l G i hearing limited to the issue of whether Georgia Power Company, et a. ( eorg a ~ Power) has misled the Nuclear Regulatory Commission with respect to the control of licensed operations of the Vogtle Electric Generating Plant (Vogtle). We find that Georgia Power's motion, viewed without consideration of the f_ ' Response, makes a proper showing for summary disposition that an' illegal transfer did not occur. It sets forth statements of allegedly undisputed facts from which this Board may infer that Georgia Power retained full control of its operating license. We note that Georgia Powcr did not ask us to determine that illegal transfer would have no licensing cansequences. We reach that conclusion on our own motion.- q In this situation, the litmus test of whether or not to grant the summary disposition motion is whether Intervenor has presented a genuine issue 'of fact that is relevant to its illegal transfer allegation and that could lead to some form of relief. En route to our decision on Georgia Power's Motion, we concluded that our conclusion - with hindsight - that Georgia Power had illegally transferred its operating license would not by itself require any We would consider granting relief in this license amendment proceeding. relief only if Intervenor shows that Georgia Power misrepresented material facts to the Nuclear Regulatory Commission with respect to the control of Georgia Power's nuclear operations. In particular. Intervenor must show material misrepresentations concerning the relationship between Georgia Power, on the 4 one hand..md SONOPCO or Southern Nuclear, on el e 1.ther hand. In determining the summary disposition motion, we have not used the For the purposes of preponderance-of evidence test to weigh the evidence.this decision, we transfer that may be drawn from the record before us, including evidence referred to in Intervenor's proposed genuine issues of fact and from the stipulation of the parties. This standard of interpretation caused us to assume that both the SONOPCO project and Southern Nuclear were so influential in managing 2 the nuclear business of the Vogtle plant that there was an indirect transfer of control without any appropriate consent in writing by the Nuclear Regulatory Commission.5 lience, for purposes of this motion only, we shall treat the transfer as illegal. h transfer in reachmg our deternunanon. we have rehed an part on a hnal ses of supulaimns relating to t eby counsel for of control issue. These stipulanons, totrether with attached enhduts, were filed August I,1994. "Supulations Relating to Alleganons of lilegall_scense Transfer 7stipulatiocl. It contmas some k matenal with antenska that were not agrevd to by su parnes We have not rehed on "supulauons" with astens s. Georgia Power-Also pending, but not yet ripe because a response has rmt been filed is Intervenor's ociober 24.1994 *Mo to Reopen thscovery " The parues also sometimes refer to southern Nuclear as soNoPCoSee section 184 of th 2 l I See hetow at pp 2%95 for a funher discussion of the opphcable aw. At.An 931,31 NRC 350. M2119901 B 291 f

E t. However, we did not consider this the end of our inquiry concerning the granting of summary disposition. We asked whether an " illegal transfer," with-out more, would cause us to restrict the granting of the requested license amend-ment. We concluded that more would have to be shown. It is our conclusion that there must be some additional showing before we would condition or deny the transfer of the license. 'Ihe contention admitted in this proceeding is:' The hcense to operate the Vogtle Electnc Generating Plant. Units I and 2. should not be transferred to Southern Nuclear Operating Company. Inc., because it lacks the requisite character, competence and integnty, as well as the necessary candor, truthfulness, and willingness to abide by regulatory requirements. The petition in this case argued that illegal transfer of the license to operate Vogtle had caused a change in safety consciousness at the plant.5 However, t Intervenor has abandoned that portion of its contention by not pursuing that part of its allegation in its response. Had the evidence permitted us to assume that an illegal license transfer has contributed to a change in safety consciousness, we would question the appropriateness of the requested amendment. Intervenor also has alleged that Georgia Power misled the Nuclear Regulatory Commission about who controlled licensed activities at Vogtle, through the omission of facts and through misstatements. We have determined that there is a material issue of fact concerning whether or not omissians or misstatements did occur. Since proof of misstatements may lead us to, tant relief, this is the sole issue of fact that we shall admit for a hearing. Hence, the only evidence we will adrnit at the hearing will be evidence: (1) showing what statements or omissions were made by Georgia Power officials to the NRC concerning the control of Vogtle. (2) providing the context to reach a conclusion concerning the falseness and the materiality of the statements or omissions, and (3) permitting us to assess the degree of culpability involved in the statements or omissions. I. BACKGROUND OF THE CASE Background helpful in understanding the pending Motion may be found in the following passages from our prior decision, LBP-93-5,37 NRC 98,99-100 (footnotes are renumbered from the original): Georgia Power proposes to amend its hcense to operate Vogtle. The proposed amendments would have no effect on the ownership of Vogtle. but they would allow Southern Nuclear 't.llP.9k$. 37 NRC %. Ii1 (1993) 8 1d M 100 ("orgamammn of soNoPCo marked a change from a "conscrsafne' to a nere "nsk talmg" atulude) 292

y: j. k Operating Company, Inc (" Southern Nuclear") to become the operator - thus, operation l ' would pass from one wholly owned subsidiary of Southern Company (Georgia Power) to [ another (Southern Nuclear). r L . Mr. Mosbaugh's principal allegation is that Southern Nuclear lacks the character and competence to operate a nuclear power plant. Briefly, Mr. Mosbaugh alleges that in 1988 Southern Company began malmg changes at Vogtle that eventually would lead to the hhng of the pending application. The Hrst operative step was the organization of a Southern Nuclear Operating Company (SONOPCO) project. At the time, Mr. Mosbaugh served as Superintendent of Engineenng Service, at the Vogtle Plant, with 400 employees reporting to him.' Mr. Mosbaugh concluded that the orge.nization of SONOPCO marled a change u from a " conservative" to a more " risk taking" attitude in the operation of Vogtle.7 He l was particularly concerned that SONOPCO scened less concerned about NRC seporting requirements.8 Mr. Mosbaugh alleges that, subsequent to the time that SONOPCO began to have influence. Georgia Power 6ted false and misleading reports with the NRC and its of6cials hied matenal false statements in response to NRC questions? We note that Intervenor has abandoned his allegation concerning a change from a " conservative" to a more " risk-taking" attitude. There are no facts contained in Intervenor's Response or in the Stipulation of Facts that would permit us to find a genuine issue of fact with respect to this branch of the ori inal contention. F II. LAW CONCERNING

SUMMARY

DISPOSITION As a scholarly Licensing Board remarked in Sacramento Municipal Utility Districf (Rancho Seco Nuclear Generating Station), LBP-93-23,38 NRC 200, 239-40 (1993): The Commisuon has recently resterated the legal standards to be apphed with respect to motions for summary disposition pursuant to 10 C F R.12.749. After describing analogies of the rule to motions for summary judgment under Rule 56 of the Federal Rules of Civil Pmcedure, the Commission observed. [10 C.F R. I 2.749] specifies that summary dispoutson may be granted only if the htmgs in the proceeding, includmg statenrnts of the parties and affidasits, demonstrate both that there is no genume issue as to any material fact and that the moving party is entitled to a decision as a matter of law. 'Fecommended Ikcismn and (hder. Allen Afmbaagh r Georgia /Wer Co. 91-1.RA-1. Il (Oct 30. 1992) (Mosbaugh tabor Case) at 45. "Georgm Power Company's Answer to the ikccmber 9,1992 Anended Prtation of Allen L Mosbaugh." December 22.1992 (Georgia Power's Second Answer A Exh 1 7 Mosbaugh 1. abor Case at 6 We consider that ttua mformanon, subnuned 49 Georgia Power, places the allegarmns an conteat

• IJ b Arnendrnents to BYtitmo to Intervene and Request for HeannF'(Mosbaught December 9 1992 tAmendnents to Petmon) at 15-19 293 i

z g u b The pany seeking summary judgment bears the burden of showing the absence of a genuine issue as to any matenal fact. In addition, the Board must view the record in the hght most favorable to the party opposing such a motion. Thus, if the proponent. . sf the motion fails to make the requisite showing, the Board must deny the motion - even if the opposing party chooses not to respond or its response is inadequate. i However, if tie movant makes a pmper showing for summary disposition, and if the pany opposing the motion does not show that a genuine issue of material fact exists, the Board may summanly dispose of all arguments on the basis of pleadmgs. To preclude summary disposition, when the proponent has met its burden, the party opposing the motion may not rest upon " mere allegations or denials," but must set forth I specine facts showing that there is a genuine issue. Bare assertions or general denials are not suf6cient Although the opposing party does not have to show that it would j-F' prevail on the issues, it must at least demonstrate that there is a genuine factual issue to be tried. The opposing pany must controvert any material fact property set out in the statement of material facts that accomparues a summary disposition motion or that fact will be deemed admitted. Moreover, when the movant has satisfied its initial burden and has supported its motion by affidavit, the opposing pany snust either proffer tebutting evidence or submit i an atYidavit why it is impractical to do so. If the presidmg ofhcer determines from afhdavits Sled by the opposing party that the opposing pany cannot present by af6 davit the facts essential tojustify its opposition, the presiding 00icer may order a continuance to permit such affidavits to be obtained, or take nny other appropriate action. Admnced Afedical Systems. Inc., CLI-93-22,38 NRC 98,102-03 (1993) (citations omitted), recemsideraimn demed. CLI-93-24,38 NRC 187 (1993). We also have accepted the following principle (cund in the comments to Rule 56 of the Federal Rules of Civil Procedure:'" Where an issue as to a matenal fact cannot be resolved without observation of the demeanor of witnesses in order to evaluate their credibihty, summary judgment is not appropriate. We are aware, however, that there has been extensive deposition testimony in this case and that, while we have not seen the demeanor of a deponent, a deposition provides us an opportunity to review the cross-examination of a witness.'8 III. Tile LAW A. Illegal Transfer Section 184 of the Atomic Energy Act, titled " Inalienability of Licenses," provides:

• Fed C = Jud proced R (West 1994) at 194 1

6 Moods l'rderal Prwuce, Part 2.156 t Sl41 (194)) i 294 -i j

P.W< ry; [f 4 ~ No hcense granted hereunder.. shall be transferred, assigned or in any marter disposed _ of, either voluntanly or knvoluntanly, directly or sndurectly. through transfer of ccmtrol of any license to ans person, unless the Commission shall, after securingfullinforrnarion. (md that the transfer is in accordance with the provisions of this (Act!. and shall give its consent $n Writing. t. P Section 184 of the Atomic Energy Act, cited in Safety Light Corp., ALAB-931, 31 NRC at 362 [ emphasis added by us]. We interpret this statute to require that a company retain actual control of i licensed activities. If. all that was prohibited was a transfer of the right to i control licensed activities, then there would be no need to specify that indirect" transfers also were prohibited..What is important is that the licensed entity, which has been approved by the Nuclear Regulatory Commission, should not. enter into a new relationship that permits individuals who are not included in the license to control licensed activities, directly or indirectly. 'This case is, however, somewhat complicated because the license was issued to Georgia Power, which is a wholly owned subsidiary of Southern Company. As a result of this preexisting relationship, Southern Company necessarily exercised some influence over licensed activities. liowever, we have not been shown the extent to which Southern Company was expected to exercise influence. Nor has a party developed an argument about the extent to which the formation of the SONOPCO project might have been merely a permissible way for Southern Company to continue to exert its influence. H. Character and Competence As we stated abose, at p. 293: f Mr. Mosbaugh's pnncipal allegarion is that Southern Nuclear lacks the character and competence to operate a nuclear power plant. 110 wever, Intervenor has not challenged any aspect of Southern Nuclear's competence apart from its integrity or character. There is extensive precedent before the Nuclear Regulatory Commission concerning the need for an operator of a nuclear power plant to have adequate integrity and character. A leading - precedent on this question is Melrepliran Edison Co, (Three aiile Island Nuclear Station, Unit 1), CLI 85 9,21 NRC Ii18. I136 (1985), which provides the following overview of this topic: The concept of "integnty." or character." is a. difhcult one to define. See generally. e g.. At.AB 772. supra.19 NRC at 1206 08; Houmm laghtmg and Power Co. tSouth Texas Project. Unns I and 2). LDP 84-13.19 NRC 659 1984). A generally apphcable standard for insegnty is whether there is reasonable auurance that the Licensee has sufficient character i 295 l l i l l l f 1

W% < '

y. '

- - - ~ -~ m.. F 7,>}@ 4 aw - E ad 4 v" -9 ,y t y ~ 'to operate the piant in a manner consineent with the public heahl and safety and applicable : NRC requwesents The Commission in making this determination may consider evidence - !j ^ '

regarding licensee behavior having a rational connection to the safe operation of a nuclear -

f[ power plante This does not rican, however, that every act of licensee is relevant. Actions '- '{ must have 'some seasonable relationship to licensee's character, Le., its candor, truthfuhess. ~ ' withngness to abide by segulatory seguirements, and acceptance of responsibihty to protect ,j . public heahh and safety. In additxia, acts bearing on character generally should not be W2 . considered in isolation. The ponern of licensee's relevant behavior, including corrective : actions, should be considered. I W in determining character, false statements may be telling indication's oflack of. L character and might be sufficient to preclude an award of an operating license, h ~ at Icast as long as implicated individuals retained any responsibilities for the ?.- project. Consumers Power Co. (Midland Plant, Units I and 2), LBP-84-20,: 19 NRC 1285,1297 (1984), citing Houston Lighting and Power Co. (South ~ . Texas Project, Units I and 2), LBP-84-13,19 NRC 659, 674-75 (1984), and - Consumers Power Co. (Midland Plant, Units 1 and 2), CLI-83-2,17 NRC 69, - ' 70 (1983). In addition, it is clear that a " material false statement" under section ~ 9' 186a of the Atomic Energy Act encompasses omissions as well as affirmative staternents. Consumers Power Co. (Midland Plant, Units I and 2) ALAB-691, 46 16 NRC 897,911 (1982), citing Virginia Electric and Power Co. (North Anna Power Station, Units I and '2), CL1-76-22,4 NRC 480, 489 (1976), ag'd.sub [ nom., Virginia Electric and Power Co. v. Nuclear Regulatory Commission 57i j F.2d 1289 (4th Cir.1978); Metropolitan Edison Co. (Thr e Mile Island Nuclear l Station, Unit 1), ALAB-774,19 NRC 1350 (1984).82 t IV. THRESHOLD MATTERS E Before we come to the substance of the Motion, the Staff Response and the Response,' we must first discuss and dispose of some pending threshold motions. i i A. Motion to Strike .l Georgia Power has filed a Motion to Strike. Intervenor opposes the Motion as prohibited by our rules. He correctly points out that once a party has filed a motion for summasy disposition pursuant to 10 C.F.R. 6 2.749, the Liccr.aing-l Board is expressly prohibited by the rule from entertaining any further supporting L j t statements. He argues that the Motion to Strike should not be entertained by } g l ll 12 We acknowledge the ruidance provided tiy NURt.u.0386. Diges 6. Revmon 7. "tJnited $lates Nuclear ' I Regulatory commisuon Staff Praence and Procedure Digest. Comnusuon. Appeal floard and Licenung Board thessions!' July 1972-September 1991 l M 2% I l

t e the Board because it is a prohibited supponing statement. Response to Motion to Strike at 1. We have decided to grant this motion in part. Intervenor is correct in arguing . that Georgia Power may not properly move to strike Intervenor's legal argument. We do not think Intervenor made an egregious error in legal argument that justifies a motion to strike. On the other hand, we find that other pans of the Motion to Strike are proper. We are persuaded by some of Georgia Power's arguments concerning the failure to place evidence in its full context. Because of this failure to interpret evidence in s'ull context, we agree with Georgia Power that we should not rely on facts that the intervenor assens based solely on the undocumented recollections of Intervenor's counsel about events occurring during a deposition." We ncte Intervenor's apparent agreement that a Motion to Strike may be properly filed if it has substantial merit. On October 13,1994, Intervenor filed a " Request to Strike NRC Staff's Response to Summary Disposition of the Illegal License Transfer Issue"(Motion to Strike Staff Response). Intervenor should not have submitted that filing unless it thought the filing might be proper. We therefore accept the shared view of the parties that a Motion to Strike may be proper if it is based on reasonable grounds. To avoid the filing of a proper Motion to Strike, a party should be very careful in its citations to the record. We do not find that Intervenor conformed to our high standards for such citations. On the other hand, we also are not persuaded by the Mation to Strike. We have refened to that motion to guide our review I f.he Response, which we found at times to be insensitive to the full context in which evidence occurred. We think our willingness to accept this guidance from Georgia Power is sufficient penalty for Intervenor for what we find to be carelessness. Striking the response would, in our judgment, be disproportionate to the offense. In making this judgment, we rely in part on our conclusion that Intervenor presented many arguments that are properly supported in the record, so that his filing was helpful to the Board. We consider Interrenor's Motion to Strike the Staff's Response to be moot. In disposing of the Motion, we found our key concern to be the detailed factual assertions in the Response. Since the Staff had not seen these assertions when it filed its own response, it did not directly address those assertions and therefore did not present arFuments that were helpful to us in deciding what assumptions to draw from the evidence presented. U As examples. me consider mentonous the followmg allegatmns m the Moton to stnke. (t) p 9 tb. (2) p

10. td. (4 p 81, Sc.141 p 14. It (5) p 17, to. to) p 23. t g. (77 pp 25-30, t1s J. k,1 n; ott p 31. td We nme that miervemw was forced to trly on the recollectmn of munwl concernmg the content of depoutmns becauw at decided. hw fmancial reasons. not to purchaw transenpts of its depouuonn 297 a

b

hs ',- .} '^ r s M.. j B.' ; Motion for Leave to' Reply, [ ~ i Georgia Power's Motion for Leave to File a Reply is denied. It had ample i p opportunity to'present to this Board its legal arguments concerning the proper . legal standards to apply to the Motion for Summary Disposition? A reply is l

expressly prohibited by 10 C.F.R. 6 2.749,

'l J e e i C. _ Public Utilities Holding Company issues '8 a. ..Intervenor's arguments concerning whether or not Georgia Power complied - admitted contention and shall not be considered. ~ with the Public Utilities Holding Company Act are not within the scope of the l .r V. FLNDINGS . A.. Control of the Vogtle Plant The principal allegation presented by the Response is that Srathern Nuclear - controlled nuclear operations at the Vogtle' Plant before n votained'a license 4 amendment that would permit it to do so. An imrortant related issue is.- -I the whether this " control" indicates a lack in the character and integrity of j the participating individuals or of Southern Nuclear. which is the proposed t transferee of Georgia Power's operating license. I We have determined that we may start the review o' the facts before us = with the Intervenor's Response. The Motion addresses some aspects of the : . formal structure of authority between Georgia Power and the entities to which. a it delegated tasks related to its nuclear operations. Oc the other. hand, Mr.. l Mosbaugh addressed in his findings of fact the pragmatic question of who actually exercised authority for the operation of the Vogtle Nuclear Power Plant. l The specific' facts alleged in Intervenor's Response were not addressed in the Motion. Hence, to the extent that we verify that the alleged facts are supported by the record, it is appropriate for us to assume, for purposes of deciding the summary judgment motion, that they are true. Intervenor has portrayed for us the way that it believes that SONOPCO and - Southern Nuclear have actually operatedc From Georgia-Power's perspective, l the same facts would be interpreted very differently. : However,' we have '- ^l ~ determined that the 'overall pattern, favorably' interpreted from Intervenor's ~ perspective, permits us to assume that the practical ability to make major decisions about Vogtle had shifted from Georgia Power to SONOPCO. t 298 l i ) t I l +

g -m s i k A' difficulty we face in deciding how to interpret the facts is that key SONOPCO employees were double-or triple-hattedF That is, they served o more than one master. This makos it difficult to determine how power actually g was exercised. In this regard, we note that the party seeking the amendment has the burden of proof and it is Georgia Power's responsibility, at this stage of the . proceeding, to demonstrate that there are no reasonable inferences from which to assume that control of Vogtle had shifted to SONOPCO. - What, then, is SONOPCO? Ihr most of the time with which we are concerned, it was a project without corporate existence.U However, what happens in the real world does not always comport with legal niceties. From the evidence produced by Intervenor it is permissible to assume that SONOPCO was a powerful entity within Southern Company.'.6. One sign of its power is that it was a consultant to Georgia Power pursuant to an unusual agreement previously negotiated with Southern Company Services. Under that agreement, Georgia Power could not - terminate the consulting arrangement without " mutual agreement"- meaning that Southern Company Services' contract as a consultant was perpetually. assured unless it also agreed to terminate that arrangement.U We assume from the evidence that the most significant individual for de-termining whether there was an indirect shift of authority is Mr. Robert P. Mc-Donald. He was the principal nuclear officer for Georgia Power and for Alabama Power. As an officer of Georgia Power, he was designated as Executive Vice President (Nuclear Operations) and reported to Mr. Sherer (or his successor, Mr. Dahlbeg).'8 We assume that, for some purposes, he reported directly to Mr. Joseph M. Farley, the Chief Executive Officer and President of Southern Nuclear We assume for the purpose of this proceeding that Mr. Farley, who had been President of Alabama Power Company, was a reluctant candidate to be SONOPCO chief executive because he already had "a high profile job" at Alabama Power and Light." We assume he was a persuasive manager with a broad interest in administration, as indicated by this NRC testimony by Mr. Mcdonald: M Supulaimns at 4 2.14b (Phase ID. Ulneervenor's Exh. 7. scherer 12/21/88 Dol Dep. at 19 "scherer 12/21/88 Dol Dep at 1516 Also, see the emump discussion in the seat. U Georgia Power Company's Response to the Board a Questions Conectning the Illegal 8.xense 7tansfer issue, August 24.1994 at 2 3. Hairson Afhdavit 116 (attached to the Response). Ilh.16 (also attached), letter of R P. Mcdonald. Apnl24.1989. " Amended and Restated Agreement." attached to letter of John tamberska of October 24.1994 at 10 C'shall remain in effect unut tetminated by mutual agreement of said parties"- with a imuted 1 I excephon stated in the followmg paragraph) '8 5npulations. Enh 3 Haarston Aff. al 6.19 Hmtston Aff at 9.119 See aho scherer 12/21/88 Dol Dit. at 15-16. supulations. Exh II. Report tktmis at 3. Intenenor's Exh 4. tamg Dep at 48. 35. Intervenor i E.nh.13. Srmth notation

1. Addnun Dep., June 9.1994 (GPC ishng) ai 3748.

l \\ 299 I i l i

y e l k He represents you might say the flow of individualized type leadership. Are those people. who are manning those jobs. are they trained well enough? What are we looking for. for building people in the future. He gets on administrative things. When we get to budget and compare all these budgets what we do is. we get the Alabama budget and Georgia budget and we get all these people who are on the board together and have one big meeting and present the budget all at one time. Each of them can see what is happening. We had one of those meetings here about two - months ago, and he gave us some pointed comments, and the Southern Company President - gave us some pointed comments. They can each see what is happening in the others and they can visually compare them. We think and they think that it's promoting management all the way around.21 We assume from the evidence that Mr. Farley held Staff conferences for SONOPCO at which the status of the nuclear plants was discussed.22 He appears to have made regular reports to the Southern Company Board of Directors.22 Mr. Farley stated that he " managed" the nuclear budget for each of the companies, which includes Georgia Power.24 Our record tends to show that at one time there was some concern by Oglethorpe Power Corporation, one of the owners of Vogtle, concerning the supervision of Mr. Mcdonald and how actively Mr. Farley was involved.25 While that concern may have been subsequently resolved, its mere existence requires us to make assumptions adverse to the interests of Georgia Power. There also is some question concerning the way in which Mr. Dahlberg viewed his responsibility for managing nuclear operation 3. For example, there . is evidence that dpon becoming Chief Executive Officer of Georgia Power, Mr. Dahlberg reviewed the qualifications of the management of Georgia Power but ' excluded all nuclear operating people, even though 70% of Georgia Power's ' assets were nuclear.2* Therefore, we assume someone else could have held that authority. Additionally, the record indicates that Georgia Power Company's Executive Vice-President for Nuclear Operations was " inadvertently" omitted from its 10-K Report to the Securities and Exchange Commission.27 Our record does not contain any evidence concerning the significance of this omission. 28 Supulanons. Esh 19. Mdhmaid Dep at 2748 22 intervenor's Exh. 4. Long Der at 43. 55. 23 We note that Mr f arley may hase bnefed the Southern Company Board of Dwertors un imponant nucle.sr matters, includmg those related to Georgia Power However. we do er rely on this alleganon m reachmg our opinmn Intervenor ened specihc Board Meeting daies but did not document them in our record. Resporue at 34-35. M Although Mr. farley aho said that he does not make the deciuon because the dension has to be Mr Dahlberg's, the assumption the Board has aAped is bawd on practical control not on authonly. so this statement is not directly rekvant Iarky Dol Dep at 94-95. 25 1ntervenor's Esh 24. oglethorpe SEC Intervennon Reply at 4. Intervenor's Esh 13. Dahlberg Dep at 96 26 Dahlberg 4/6/94 Dep at 70 71.122-24 Dahlberg 5/lV9u DOL Dep at 44

1. 7Monon to stnke at 16-17.

300

q c,, Y,I $ ,h a g 5 l, 4 h . h L jfp, i h, u9g 1 xl s mW ~ N, I t l V; ' i 2 ^; 3 E With' respect to whether Mr. Dahlberg had effective control over SONOPCO,' ~ t m we assume from the' evidence that Mr. Dahlberg began to form a Georgia Power

group'thatjwould help him review the operations of SONOPCO/ That group'

withered and was disbanded under circumstances that lead us to assume that i

" ~ ' % v) i Mr. Farley had a powerful influence on this decision.qs The apparent importance l ' of this group to Mr. Dahlberg,' at one time, is indicated in his Memorandum

j a

Tof December 27, ' 1988, to: " Executive' Officers Division Vice Presidents General Office Depanment Heads and Division Managers." This memorandum, 1 ~ Intervenor's Exhibit 26 says:. i i It is imponant for us to realize that while our nuclear operations rnay be rnanaged in , Birmingham and ulurnately will be managed by a separate Southern subsidiary. Georgia , Power will he held accountable by our regulatory groups, our stockholders. and the public

I for the operation and performance of our nuclear units. - It is essential that Georgia j

~ Power Company be involved in the operations of our units, monitor their performance and - . integrate nuclear operations goals, accountabihties, and fme.ncial planning into Georgia Power : Corporate PlanJ E!!cctive immediately, a Nuclear Operations Contract Administration Group is formed to interface with our nuclear operations group in Birmingham. This group will report to Mr. G.P. Head. Senior Vice President, who will be responsible for all nuclear operations interactions. Mr. Mcdonald. appears to have been a triple-hatted SONOPCO employee, .) located in BirminghamP where Mr. Farley's office :Is3 was located. We assume that Mr. Mcdonald had more. frequent in-person contacts with Mr. Farley than j with Mr. Dahlberg. Furthermore, Georgia Power planned to apply for a license. amendment that would make Southern Nuclear the operator of Vogtle and would have Mr. Mcdonald report solely to the chief executive for Southern Nuclear." l .'So we may assume for the purpose of this proceeding that Mr. Mcdonald was y more dependent for his career on Southern Nuclear than on Georgia Power. (We - rnale this assumption in considering a summary disposition motion even though .j , subsequent events call it into question. Both Mr. Mcdonald and Mr. Farley have retired and Mr. Dahlberg has become CEO of the Southerts Company.) We also assume for the purpose of this proceeding that SONOPCO executives . and prospective Board members sometimes operated collegially. Some meet-ings appear to have been called " Board Meetings"in a participant's appointment s "Intervenor's Enh 31. Testinmny of Mr. Head taccuding to representanon or Mr Kohn) at 652 Intervenor's Enh. 31, Farley Dep at 570. Intervennr's Enh. 31. Farley Dep at 587 88. tniervenur's Enh. 31. Hobby rr at ifio . gossibly substanuated in Hobby Log, Intersenor's Enh 18) Strpulatmn at 4-5. M 12. 84.19

• supulatwns at 2. We nose that Intervenor did not concur with this stipulation but this use of the shpulation is adverse to the interest of Georgia Power, which offered it into our recewd

.I 301

l a

o. L'

" book, and these meetings also were referred to as " informal board meetings."3' Since there was no corporation, there was no Board, in a formal sense. Ilowever, the existence of these meetings suggests a participative style of management. We assume, for purposes of the pending motion that undoing collegial decisions may be harder than undoing individual decisions, particularly because Mr, Briey t lent special credibility to the group. c On the other hand, evidence indicates that Mr. Mcdonald was in regular contact with Mr. Dahlberg by telephone and, at times, face to face. Mr. Dahlberg apparently received written reports about nuclear operations.32-In addition, Mr. Dahlberg appears to have been actively involved in some matters, such as whether or not Georgia Power would agree to performance standards set by the Public Utilities Commission.)' However, we are not aware of evidence. concerning how much detail Mr. Dahlberg received in his reports, the nature of his review or the scope of his responsive actions. We also do not know if there was a different scope for routine or special matters such as the nuclear budget of Georgia Power or policies concerning scheduled autages. A portion of the case on illegal transfer is aamissible direct testimony or inferences drawn from the report of an NRC Staff inspection. Er example, Mr. Robert W. Scherer, former Chief Executive Officer of GpC, testified, in December 1988, that: Right now the relationship is that SONOPCO will operate the generating plants. the nucius generating plants, for the individual operating cr mp;. ties. Alabama and Georgia. that own nuclear power facilities. eee IT]he formation of [SONOPCOJ, , the actual configuration of it, exists in reahty in Birmmgham because we have brought togetner the corporate general office staff of Alabama and Georgia. and also of Southern Company Services, into one central location, u-ith the responsibolery of operating nuclear plants of the wrious operatung companies. IEmphasis added.) Scherer 12/21/88 DOL Dep. at 19 (Intervenor's Exhibit 7)." i 3'Intervenor's Exhs ll and 12. rarley Dol Dep at 8445 Mr. Mcdonald's tesunumy se shghtly different imm Mr. Farley's He states that there was no informal Daard bu6 "a meetmg of the partn" He states that theie have been one or two of those meeungs of people who were envisioned to be on the Board.1his included Mr. Harns. Mr. Dahlberg. Mr. rrunkhn. Mr Addnon. Mr. Farky. and Mr. McDonalJ The nretmg covered "the mapr problems that the plants have " Mcdonald Dol Dep. at 69-70 Mr. Dahlberg renwmbered only one nweting of the propmed Board of Directors of SoNoPCO. He said there may have been a diuussion of litigation with oglettmrpe and of major budget issues. induding the sont of condenser tubes at the Hatch Plant They aho discussed "the nunder of outages that would be plamwd" Dahlberg DOL Dep., May 1990 at 68 70. 32 Stipulatmns at 9,141. Dahlberg 4/6N4 Dep 20-27. Dahlbeig 6/10rd Dep at 43-41 D Dahlberg DOL Der as 92 95. I oL Tr. at 336-42. Hobby Dep. at 62 61 M See alm Supulations. Exh $. authontmg the transfer of nuclear management to a nuclear operaung managenent subsidiary of southern Company. This formal resoluuan dies not seem to retain temporary operating authority in Georgia Fou 1 302 1 1 1 i 1 l l o

n - l.' e We r:onsider Intervenor's Eshibit 15 as evidence that suppons the presup-position that there are questions about who was in charge. That exhibit is a telephone list titled, " Telephone List - On-Call Project Manager." On the list, as number one under the heading, " Georgia Power Company Corporate Man-agement," is Mr. Joseph M. Farley. Mr. Dahlberg is in the same category as fourth on the list. Mr. Mosbaugh, in his affidavit, states that he was a "Vogtle Duty Manager" and that his instructions were that in the event of "significant operational and emergency events" he was expected to call the people listed as, " Georgia Power Company Corporate Management." Intervenor's Exh. 22, Mosbaugh Affidavit,115, 8, and passim. Another piece of evidence is a summary of a December !9-21,1988 Inspection of GPC plants by the Staff of the Nuclear Regulatory Commission. At that time, the Staff stated: i AdditionaHy it was deternuned that althoagh the new operating philosophy of the corporate staff in a support role as opposed w an twmiew role was souty', the Vogtle Final Safety Analysis Report needed to be revised to renect this philosophy change. Stipulations, Exh. I1, Summary at 2. We note that within the nuclear adminis-tration area of inspection the Staff found that "the FSAR requirements were not reflective of the new corporate support role concept" and that "new policy and instructions are being drafted." Stipulations, Exh. I1 Report Details at 6. Nr all the foregoing reasons and upon consideration < the entire record in i this n atter, v.e assume for purposes of decidinF this moton that Georgia Power did indirectly trans er the control of VoFtle nuclear operations to SONOPCO r and to Southern Nuclear. 11. EfYect of lilegal Transfer on Safety Intervenor has made no showing that the transfer of authority to SONOPCO and to Southetn Nuclear had any effect on the safety of Vogtle. We therefore dismiss that portion of its allegation of illegal transfer. C. Alleged Omissions or Misrepresentations The testimony of Mr. Scherer, plus inferences from other evidence presented above beginning at page 19, requires us to assume, for the purpose of the pending MC. ion, that Georgia Power made omissions or misrepresentations in its presentations to the Nuclear Regulatory Commission. However, we wish to caution Intervenor io be meticulous in presenting evidence about alleged omissions and misrepresentations, which are hard to prove even when they have occurred. For each allegation, we will need to know as precisely as we can: (1) 303 i l .i l l i l

what was said, (2) in what context the statement existed, (3) the proof that the statement was inaccurate or incomplete, (4) when (if applicable) the statement was corrected, and (5) why we should be concerned about the length of delay between the statement and when it was corrected. His will require proof of a time line of actual events, demonstrating not only that they occurred but also when they occurred. We also will require that the proof offered will make some allowance for inaccuracies in expression, understandine and memory. So we will need to know also how much time passed before the alleged misstatement was made. It would be helpful to us if time lines and charts were used to communicate Intervenor's points clearly. Such simple and easy-to-grasp devices would be appreciated in the filings of all the parties. D. Misrepresentation Before the SEC On June 22,1988, the Southern Company filed an application with the SEC to form SONOpCO as a subsidiary. Stipulations. Exh. 6. Intervenor alleges that this filing made no mention of the interim formation of a SONOPCO project. De Board finds that this allegation is not supported in the record and does not constitute a genuine issue of fact that should be scheduled for a hearing. M SEC filing contains the following: authern antecipates implementmg the SONOPCO operating strucure in a transitmnal process insolv ng three phases with each phase being designed to emprove the safety and efficiency of the naclear operations over that obtained in the previous phase. Southern anticipates that each phase of this project will have benehts for system operations independent of the bereefits derived from subseq.cnt phases and wdl evaluate cach phase prior to implementation. The inmal phase ws!! be to form a matna orgamzation in which key management personnel wdi be shared between APC [ Alabama Ibwer Company) and GPC (Georgia Power Company] pursuant to shared employment agreements in substantially the form attached as Exhibit B-l hereto. No changes in corporate structures udl be needed to accomphsh this poohng of mcnageurnt resources. Exhibit B 2 hereto presents the matns organizational structure dunng phase one tBoard Comment' Exhibit B-2 is a block orgamzational chart entstled, Phase One Marns Organi arwn) The second phase, to comnence upon approval by the Commission of this apphca-tmn/dectaraton, will entait creation of the nuclear operating company as a service comnany providmg nuclear services to APC and GPC. In addition, the SEC gave the public notice of the proposed change on August 12,1988. (SEC Release No. 35 - 24694, Stipulations. Exh. 8) The SEC Notice also describes the proposed phased change in organization: SONOPCO's operating structure will be implenented in three phases. Initially, Ley nudear operatmns management personnel will be shared between APC and GPC. In 304 1 4 1 T

p the second phase, which would begin upon approval tiy the Commission of the present applicauon-declaranon. SONOPCO will be organized as a service company that will provide AK' and GPC with nuclear services, includmg plant operating services, fuel procurement services, administrative services and technical services, but will not own,6 nance or operate any nuclear or other utihty assets. In the third phase, SONOPCO will becorne responsible, on behalf of the owners and through contract with them, for the operation and maintenance of all nuclear generating facilities owned by Southern electne system companies. SONOPCO may apply to the Nuclear Regulatory Commission ("NRC") or ats successor for facihty licenses or permits for the Parley Nuclear Plant ("Farley"), owned and operated by APC, and for the Hatch Nuclear Plant ("Haten") and Vogtle Nuclear Plant ("Vogtle"), each 1 of which is jointly owned by GPC, the Municipal Electnc Authority of Georgia. Oglethorpe Power Corporation, and the City of Dalton, Georgia. and for which GPC is the present hcensee and operator under an existing operating agreement.,, tSup. Ex. 8 at 2) r Our reading of the SEC filing is that the SEC was fully informed of the phased approach to establishing Southern Nuclear. Hence, Intervenor has not demonstrated the existence of a genuine issue of fact. E. Communications Between Georgia Power and the NRC We are aware from our studj of the record that there were extensive com-munications between Georgia Power and the NRC. The NRC also amassed sub-stantial knowledge of Georgia Power through its resident inspector program and its inspectiot. program. For Intervenor te demonstrate m.. crial misrepresenta-tions or omissions, it must place communications N Georgia Power in the full context of its relationship with the NRC. In this section of our Memorandum and Order, the Board sets forth some of the facts that show to our satisfaction that communications were complete and above board. The purpose of this pre-sentation of facts is to inform the Intervenor of part of the context within which it must prove its case: On July 25,1988, the NRC uas mformed by GPC that a project orgamration had been estabhshed for each plant, Sup. Ex. 9, enclosure 1. The NRC also was furmshed with separate organization charts for " Nuclear Operanons - Transition Organizaton" and for Vogtle Project Transumn Org.muasion Suputations. Ex. 9, enclosure 1 We fmd that NRC was duly infornwd of GFCs plans for reorgamration at this meeting. "It is our opinion that thu meeting was benencial and has Lept us appnsed of your nuclear operatmns organizatmn." (Aug 11,1988 Letter from Region II Adnumstrator to GPC; Sup 93 The followmg matenal fact presented by GPC h.a not been opposed i, L.tervenor and is therefore admitted. 6 GPC and SONOPCO Project penonnel met repeatedly with representatives of the NRC to Lecp them abreast of all esents pertaimng to the phased formation of SONOPCO. NRC representanves also conducted ute inspectmns of the ofhces in Ihrmingham to ensure comphance wnh NRC reFulatory requirements. Sup. T15,6, 10.14.15.16. 21. 25 and 29. Hairston Aff.17). 305

h F. Transfer of Nuclear Operations to Birmingham Finally, we note that Intervenor has claimed that NRC Region II was told that GPC's nuclear operations would remain in Atlanta until SEC approval for [: ' SONOPCO is obtained and the location of SONOPCO would not be decided until after SEC approval. Intervenor cites the July 25.1988 meeting summary as support for this allegation. (Stip. Exh. 9, Encl.1.) Intervenor claims this [_ information is inaccurate in three respects: (1) NRC was not advised that a i L "SONOPCO project" would be formed; (2) NRC stated that GPC's nuclear operations would not be moved until SEC approval was obtained, whereas, in fact, GPC's nuclear operations were moved prior to SEC approval; and (3) the Scation of SONOPCO had not been selected, whereas, in fact, Birmingham site had already been selected. Intervenor's Response at 18-19. The evidence supports, Intervenor's allegation that on August II,1988, the - NRC appears to have unde stood that a move of the corporate office k> cation would be decided only after SEC approval of the formation of SONOPCO had been obtained." However, Mr. Addison announced only 41 days later that he had decided to move the offsite nuclear management and support functions of both Alabama Power and Georgia Power to a location near Birmingham."- Furthermore, the NRC knew no later than December 19, 1988, that the move took place on November 1,1988? Since Intervenor has not alleged any motivation for this delay and has not shown that Georgia Power gained anything through this delay, we are unimpressed by the amount of h delay that may have occurred before disclosure. Consequently, we do act find this to be a material misrepresentation and we do not admit it as a genuine issue of fact. VI. CONCLUSION 7 Pursuant to 10 C.F.R. 5 2349, we assume for purposes of deciding this motion that Georgia Power did indirectly transfer the control of Vogtle nuclear operations to SONOPCO and to Southern Nuclear. However, we conclude that even if this transfer did occur, it would not provide an adequate reason to grant relief in this license amendment proceeding. 'lhe Board acknowledges that Georgia Power did not request this ground for decision. However, our consideration of this case led us to that conclusion because we decided that merely showing an illegal transfer would be irrelevant. We recognize that Georgia Power may want to demonstrate at ihe hearing that it D si pulmnes. Ext; 9. I nct i "supulaimns Enh 10 "Supulanons, I sh. I L Inspectwo Report at I rResuh6") We note, as well that the NRC has a resident mspector at Vogile He was hkely to know of a chang of this unportance :.s soon as it occurred r 306 i i l

E did not illegally transfer control of its license. It may choose to introduce such proof in order to demonstrate that its representations to the Nuclear Regulatory Commission were not misleading. However, since we consider i!!cgal transfer irrelevant to the outcome of the proceeding, we will permit such proof only to the extent relevant to allegations of misrepresentation. On the other hand, we also conclude that there are genuine issues of fact concerning whether Georgia Power may have misrepresented its relationship to SUNOPCO and Southern Nuclear. These allegations require a hearing at which we can determine whether or not they are true. We stress that no allegations of misrepresentation have been proven This decision determines only that a hearing on this issue shall be held. We also have determined, however, that there is no genuine issue of fact concerning the following issues: (1) whether or not Georgia Power improp-erly withhcid information from the Securities and Exchange Commission, (2) t whether or not Georgia Power improperly delayed informing the NRC that its corporate offices were being moved to Birmingham, and (3) whether or not Georgia Power has violated the Public Utilities Holding Company Act. This third issue is excluded from the hearing because it is beyond the scope of the admitted contention. VII. ORDER lbr all the foregoing reasons and upon consideration of the entire record in this matter, it is, this 8th day of November 1994 ORDERED that: 1. Georgia Power Company's " Motion for Summary Dispositioe. of Inter-venor's Illegal Transfer of License Allegations," August 24,1994, is granted in part. 2. A hearing concerning alleged misrepresentations to the Nuclear Regula-tory Commission shall be convened on December 19,1994, at a location to be decided. 3. Summary disposition is granted for the following issues, which are no longer part of this case: (1) whether or not Georgia Power improperly withheld information from the Securities and ExcL...ge Commission, (2) whether or not Georgia Power improperly delayed informing :he NRC that its corporate offices were being moved to Birmingham, and 5 307 I i j i i

(l l (3) whether or not Georgia Power has violated the Public Utilities Hold-ing Company Act. THE ATOMIC SAFETY AND LICENSING BOARD James H. Carpenter (by PBB) ADMINISTRA11VE JUDGE Thomas D. Murphy ADMINISTRATIVE JUDGE Peter B. Bloch, Chair U ADMINISTRATIVE JUDGE Rockville, Maryland 6 i e 308

y > =n m .u s Cite as 40 NRC 309 (1994) LBP-94-38 i ~ UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION ATOMIC SAFETY AND LICENSING BOARD r.. Before Administrative Judges: Thomas S. Moore, Chairman Richard F. Cole Frederick J. Shon ' f - i in the Matter of Docket No. 70-3070-ML - i (ASLSP No. 91-641-02-ML) (Special Nuclear. Material License)- LOUIStANA ENERGY SERVICES, L.P. (Claiborne Enrichment Center) T,ovember 18,1994 i i RULES OF PRACTICE: DISCOVERY Section 2.740(f) like its counterpart in the last sentence of Rule 37(d) of the Federal Rules of Civil Procedure from which the Commission's provision was copied, applies exclusively to situations where a person or party totally fails to respond to a set of interrogatories or document requests. See 8 Charles A. . Wright et al., Federal Practice and Procedure i2291 at 809-10 (1970), See, e.g., loclede Gas Co. v. Warnecke Corp., foi F.2d 561,565 (8th Cir.1979).' { RULES OF PRACTICE: ' DISCOVERY Where a pany has filed objections to one or more interrogatories or document - ~ requests or set forth partial, albeit incomplete, answers in a discovery response, l the last sentence of section 2.740(f) has no applicability.- The proper procedure in such a situation is for the party opposing the discovery to await the filing of j a motion to compel and then respond to that motion. i i 309 i ) i . i I a r --u-m-

MEMORANDUM AND ORDER On November 9,1994, we issued a rnemorandum and order granting the October 5,1994 motion of the Intervenor, Citizens Against Nuclear Trash, to compel the Applicant, Louisiana Energy Services, L.P. (LES), to respond to a number of discovery requests. That ruling resolved the discovery disputes between'the Intervenor and the Applicant over the Intervenor's interrogatories 40,44 52, and 58 and document requests 10-14. Rennaining for our resolution, however, are the disputes between the Applicant and the Intervenor over the Intervenor's interrogatories 59 and 60 and document request 19. nese discovery disputes come before us on the Applicant's September 16 and 20,1994 motions for protective orders. In its responses to interrogatory 59 and document request 19, the Applicant stated its objections to the discovery requests. Similarly, the Applicant set forth its objection and, in addition. provided a partial answer in its discovery response to interrogatory 60. Hen, rather than wait and oppose any forthcoming motion to compel from the Intervenor as it did with its other discovery responses, the Applicant filed two motions for a protective order with respect to interrogatories $9 and 60 and document request 19. Although its motions do not reveal why the Applicant sought protective orders in these circurastances, we note that there appears to be a misapprehension among members of the NRC bar that the last sen cace of the Commission's discovery rule on motions to compel,10 C.F.R. 6 2.74C f), requires the filing of a motion for a protective order when only an objection or an incomplete answer is provided in response to a discovery request. nat provision states that a "[f]ailure to answer or respond shall not be excused on the ground that the discovery sought is objectionable unless the person or party failing to answer or respond has applied for a protective order pursuant to paragraph (c) of this section." This provision, like its counterpart in the last sentence of Rule 37(d) of the Federal Rules of Civil Procedure from which the Commission's provision was copied, applies exclusively to situations where a person or party totally fails to respond to a set of interrogatories or document requests.' Where a party has filed objections to one or more interrogatories or document requests or set forth partial, albeit incomplete, answers in a discovery response, the last sentence of section 2.740(f) has no applicability. De proper procedure in such a situation is for the party opposing the discovery to await the filing of a motion to compel and then respond to that motion. He reason for this should be obvious: upon receiving the objection or partial answer to its discovery request, the party 3 5cc 8 Ourles A whght et al.. f rdrral frat ru r and Prm rdwr i 2291 at 809-10 (1970s Sec. c y. Lulede Gas Cp i Wumn Ar Corp. to4 F 2d 561. 565 (llth Cu 1979) 310 r I t

E F seeking the discovery may not wish to pursue the discovery further and the matter then is at an end, without the Licensing Board becoming involved and p the expenditure of any resources by the parties or the Board. Moreover, the filing of a motion for a protective order where the proponent of the or'er already has filed objections or partial responses to the discovery requests shifts the burden of going forward from the party seeking discovery ~' to the party opposing it. But most significantly, in such circumstances the party' seeking a protective order arguably must meet a higher standard to ' thwart the discovery than when merely opposing a motion to compel. Under i the Commission's rule for protective orders,10 C.F.R. I2.740(c), like the corresponding provision of Rule 26(c) of the Federal Rules of Civil Procedure, the movant must demonstrate good cause" that a protective order is necessary "to protect a party or person from annoyance, embarrassment, oppression, or undue burden or expense." No such requirement exists for opposing a motion to compel under section 2.704(f) of the Commission's discovery rules. Regardless of the Applicant's reasons for filing the motions for protective orders, they are before us for resolution and we must judge them by the good cause standard of section 2.740(c). We turn first to the Applicant's September i 16 motion seeking an order that it need not respond to interrogatories 59 and i 60. Interrogatory 59, like the other interrogatories we dealt with in our November 9 ruling, seeks information about the Applicant's actions in selecting the site near Homer. Louisiana, for the Claiborne Enrichment C.nter. Specifically, the interrogatory seeks the identity of any Louisiana churches and community groups and any Louisiana charitable, civic, or political organizations to whom the Applicant made donations before and during the site selection process. In its response to this interrogatory and in its motion for a protective order, the Applicant objects to the discovery on the Fround that it is not relevant to any of. - the cententions in the proceeding. l Even assuming that a general relevancy objection can meet the good cause test of section 2.740% n order to protect the inovant fiom " annoyance," such an objection k without merit here. The Applicant's relevancy objection to interrogatory 59 raises the same issue in the same context as the Applicant's previous oFjections to Intervenor's interrogatories 40, 44-52, and 58. In our Novembe 9 ruling, as well as our -lier June 18,1992 ruling, we rej:cted the' Applicant's arguments, and those rulings are controllinF ere. As the Intervenor h points out in its response to the Applicant's motion LES claims to have based its siting decision in part on the views of community and opinion leaders. This being so, interrogatory 59 seeks information on certain of the Applicant's actions [ that may have influenced these leaders Thus, because interrogatory 59 seeks information about the site selection process and. as our previous rulings explain, ( 311 ^ i l f

n I L ' the selection process is relevant to contention J, the Applicant's objection is L without merit. Fqually,.without merit is the Applicant's bald assertion that it will be subjected to annoyance, oppression, undue burden, and expense if it must respond to interrogatory 59. More than a mere conclusory statement is needed to establish good cause for a protective order, He Applicant must provide a L particular and specific demonstration of fact to meet the requirements of section 2.740(c) and it has made no such showine. Accordingly, the Applicant's motion for a protective order with respect to interrogatory 59 is denied. Interrogatory 60 seeks a full description of the discussions, communications, and interactions between the Applicant.and Senator J. Bennett Johnston of Louisiana with respect to the Applicant's proposal to build a uranium enrichment facility in the United States. In responding to this discovery request, the Applicant d;d not raise a relevancy objection. Rather, the Applicant gave a partial answer stating that LES personnel had met on a number of occasions with Senator Johnston and that he had sponsored an amendment to the Solar, Wind, Waste and Geothermal Power Production Act of 1990, which provided that uranium enrichment facilities must be licensed under 10 C.F.R. Parts 40 f and 70 rather than 10 C.F.R. Part 50. De Applicant's response then stated that any further answer would subject it to undue burden and expense. In its motion f,r a protective order, the Applicant reiterates this objection and states omple'e responw to this request would involve eview by numerous that "[aw individuals emp'oyed by LES and its partners of four yeacs of records such as calendar entries, trip reports, and meeting notes."2 he Applicant's claim of undue burden and expense is without merit. By the Applicant's own description, the effort required to respond to interrogatory 60 is not unreasonable. At most, its motion suggests that the Applicant will be inconvenienced by responding. Far more than a showing of inconvenience is necessary to establish the requisite good cause for a protective order under section 2.740(c). Additionally, in its response to the Applicant's motion, the Intervenor has narrowed the scope of interrogatory 60. His action further lessens the impact of responding to the already reasonable discovery request. Accordingly, the Applicant's motion for a protective order with respect to interrogatory 60 is denied.) 2 Apphcant's Monon for a Protective order (Seniember 16.1994) at 2 3. 3 The Appheant's nmtion for a prosectne order also sequests that it not be required to answer poruons of Intervenor's interrogatones38. 41. 45. 50. and 52 These enterrogatories ask. enter she that the ApphcarA promde she face of the indmduals involved m various aspects of the sue selecuon process if such informatmn en known la ns discmery resportsen. the Appbcant objected to the race quesuon in each meerrogatory and also responded that it did not know the race of the indmduals involved The Apphcant's response to each of these smetrogatones that u does not know the race of she mdmduals mvohea adequalcly answers the discovery requests. Indeed. in ses ociober 5.1994 smumn 10 compel, the Intersenor states. with respect to interrogatory 45, that et accepts the IContmurd! 312 l i 1 1 j

{ w Document request 19 corresponds to interrogatory 60. It seeks any documents referring or relating to the contacts between the Applicant and Senator Johnston. In its discovery response, the Applicant objected that answering the document request would subject it to annoyance, oppression, undue burden, and expense. De' Applicant's motion for a protective order reiterates that a response would require a review by numerous individuals of 4 years of records. As in the case of interrogatory 60, corresponding document request 19 is not unreasonable. Moreover, in responding to interrogatory 60 much of the work will be done - i for responding to this document request. Additionally, in its response to. N the Applicant's motions for protective orders, the Intervenor has narrowed . its document request to parallel its narrowing of interrogatory 60. Hus, the impact of this discovery request is further reduced. In _these circumstances, - the Applicant's motion does not establish good cause for issuing a protective order. Accordingly, the ' Applicant's motion for a protective order with respect y to document request 19 is denied, h For the foregoing reasons, the Applicant's September 16 and 20,1994 mo-tions for protective orders that it need not respond to Intervenor's interrogatories 59 and 60 and document request 19 are denied. It is so ORDERED. THE ATOMIC 3AFLTY AND LICEt. SING BOARD Thomas S. Moore ADMINISTRATIVE JUDGE . Richard F. Cole ADMINISTRATIVE JUDGE Frederick J. Shon ADMINISTRATIVE JUDGE Rockville, Maryland November 18,1994 e Apphcant's represesuson aboul not knowing the race of she iruhviduals involved. Because the Appheant aheady has answered thew snierrogatones. there as no dnpute between the parties and no baus for tenuing a prosecuve order under section 2 740dct 313

x:- y g c r 1. i Cite as 40 NRC 314 (1994) LBP-94-39 ?; c . UNITED STATES OF AMERICA l . NUCLEAR REGULATORY COMMISSION ~l ATOMIC SAFETY AND LICENSING BOARD. It Before Administrative Judges: I h James P. Glosson, Presiding Officer Jerry R. Kline, Special Assistant in the Matter of I ,~ Docket No. 40-8027 MLA-3 j (ASLBP No. 94-700-04-MLA-3) (Source Materials License j No. Sub-1010) SEQUOYAH FUELS CORPORATION November 22,' 1994 [ REGULATIONS: ~ INTERPRETATION (10 C.F.R. 5 2.1205(d)) RULES OF PRACTICE: INTERVENTION PETITIONS (PLEADING REQUIREA1ENTS FOR STATE 31ENTS OF CONCERN IN SUBPART L PROCEEDING) While the threshold showing at the intervention stage of a Subpart L pro-ceeding is exceedingly low; a statement of concern must be plead with enough specificity to allow a presiding officer the ability to ascertain whether or not - what the intervenor seeks to litigate is truly relevant to the subject matter of the proceedinF-REGULATIONS: INTERPRETATION (10 C.F.R. 5 2.1237(a); 10 C.F.R. 5 2.730(c)) RULES OF PRACTICE: 310TIONS (REPLIES TO ANSWERS) A proponent of a motion does not have the right to reply to an answer to the motion; parties who do not seek leave to file a reply are expressly denied the opportunity to do so. 1 314 ) I t i ) i t L

MEMORANDUM AND ORDER (Ruling on Motion for Reconsideration) In a motion dated October 26,1994, intervenor Native Americans for a Clean Environment (NACE) seeks partial reconsideration of the Presiding Officer's Memorandum and Order of October 14, 1994. In that Order, NACE was admitted as an intervenor in this proceeding and four of the six concerns raised by NACE were admitted for litigation. NACE now requests the Presiding Officer' to reconsider the decision to exclude the remaining two concerns.2 Those two concerns had been excluded from litigation because the Presiding Officer found them not to be germane to the proceeding? 'Ihe first statement of concern excluded reads: SPC has drastically reduced its snanagerial staff without dernonstrating that the extensive and highly technical tasks associated with decornmissioning can be accomplished safely and 4 effectively under the new organization. NACE argues that the Presiding Officer, in rejecting this concern. "apparently adopted SFC's incorrect reasoning that its current activities do not constitute ' decommissioning.'"5 The Presiding Officer agrees with NACE's position that the activities currently being conducted at the facility are in the nature of decommissioning activities. If the proposed management changes bring about regulatory dtficiencies tied to such decommissioning..cti ities, they are fair Fame for litigation, being germane to the subject matter of the proceeding. However, the Presiding Officer's decision to exclude this area of concern from the proceeding has little to do with decommissioning activities. As stated in the Memorandum and Order of October 14, although NRC's Rules of Practice do not provide explicit guidance on criteria necessary for a petitioner's areas of concern to be accepted for litigation, the Commission's statement of consideration in the adoption of Subpart L does reflect the require-ment that the " issues the requester wants to raise regarding the licensing action 'Thmughout its monon. NACE outhnes its differences muh respect to the "Dcenwng Board " The proviuons of 10 C F R. Part 2. Subpan L under which shis proceeding is bemg conducted. provkle for a si....e Preudmg Ofncer matead of a beensmg Board to overnee the proceeding 2 Comnusuon practice allows a pentioner. in a nonon for reconuderanon, to elaborate on or refine argunrnte prevumly advanced See Central Eterrric fourr Cooperunne, Inc. (vergil C. Summer Nuclear Stanon. Unit I), Ct18126,14 NRC 787,790 (1981) 'See 10 C.f R I 2120$4g) d Nauve Anrncans for a Clean rnvironmeni s and Cherokee Nanon's Request for Heanng on sequoyah Fuels Corporanon's beenw Amendnrns Request of May 6.1994, and Request That Heanng Be Held in Abeyance pendmg Settlement Negati: mons duly 19.19941 ai 7. 'Reconuderanon Mormn at 12 315

b l fall generally within the range of matters,,. properly subject to challenge in [the] proceeding "6 . In Subpart L proceedings, a statement.of concern must provide enough specificity to afford the Presiding Officer the ability to link the concern with L the subject matter of the proceeding in order to make a decision to rJmit the statement for litigation. Section 2.1205 states explicitly that the request for i hearing filed by a person other than an applicant must describe in detail the requester *s areas of concern about the licensing activity that is the subject matter - of the proceeding' As the Commission has stated: . It would not be eqmtaNe to require an intervenor F 4le ita written presentation setting fotth . all its concerns without access to the hearing ide. ) wurse the intervenor is required to identify the areas of concern it wishes to raise in the proceeding, which will provide the presidmg officer with the minimal mformation needed to ensure the interunor destres to htigare issues germane to the licensing proceedmg. . (Etnphasis suppliedl* As a petition for intervention setting forth a petitioner's statement of concerns,. .NACE's petition is partially deficient. Nur of the concerns are expressed with enough clarity for the Presiding Officer to find thetn relevant to the license amendment, two of them are not. The lack of specificity in those two concerns leaves open the question whether they are relevant to the proceeding. First, it is unclear whether NACE is addressing staffing concerns or concerns over the technical nature of decommissioning activities and its influence on SFC management. Second, merely st: sting that the quality as.,urance program is inadequate gives no indication to the Presiding Officer that the QA program may be affected by the license amendment. Again, without more, no determination can be made regarding whether that issue is germane to the proceeding. Throughout the NACE Motion for Reconsideration, the Presiding Officer is taken to task for not raying heed to the embellished arguments found in the NACE Reply. NACE is coTect in its speculation that the Presiding Officer did not rely on the Reply arguments, Under the provirions of section 2.730(c), the moving party has no right to reply to an answer without first moving the Presiding Officer for permission to make the Reply? No motion was made

• statement of Cons deranons, informal Heanny Procedures for Marenals beenung Adjudicanon. % Fed. Reg 8269. 8273 (Febniary 28.1989) 7 10 C F R. I 21205(d) and (dH31 "54 ied. Reg 8272 (reb. 28,1989)

'Tctas (!ribnes Elecinc Ca (Comanche Peak Steam iIcetnc station. Umts I and 2A CL1-89-6, 29 NRC 348 353 al n.2 (1989) truhng on miervennon pennon), Drrrors Edison Co. (Enneo Fernu Atonne Power Plant. Urut It ALAB-469,7 NRC 470,471 (1978), but cf Leg Isl.md Lightmg Co. (shoreham Nuclear Power Station. Urut ik LBP-81-IB.14 NRC 71. 72 0981) canng &uston bghtrng and funer Ca (Allens Creek Nuclear Generaung station, Umt i t ALAB-565,10 NRC 521 (19791 truhng on a contennon the Appeal Board noted that m monons practace a comennon is akin to a cornplains m federal court and an answer is akm to a monon to disnuss theret$y favormg adtmssion of a reph). In this case, however, the i.nomng of Allens Crrrk is mg apphcable because the decmon to cadude the staiements of concern dsJ not turn on the arguments found in sFCs answer 316 I l -) i I 6 is

y h-H on behalf of NACE and'therefore the Reply was not taken into consideration in the decision to exclude the two statements of concern.5 Which brings us to the Motion for Reconsideration. - Much, if not all of NACE's Motion regarding the first excluded concern reargues the perceived differences between NACE's and SFC's interpretations. of" decommissioning" and when decommissioning commences. There is little in the way of clarification of the first excluded statement. The uncertainties remain as before. Not enough information has been provided. While the threshold showing at the intervention stage of a Subpart L proceeding is exceedingly low, it cannot be so low as to frustrate a Presiding Officer's ability to ascertain. whether or not what the intervenor seeks to litigate is truly relevant to the j license amendment being challenged. In this case, the uncenainty remains and the statement is excluded from litigation in this proceeding. NACE's statement of concern regarding the SFC quality assurance program reads: SFC's new quality assurance program is inadequate. NACE's hearing petition provided nothing to aid the Presiding Officer in his duty to determine the relevance of this subject area. The Motion for Reconsideration provided. arguments that embellished on this concern for the first time. NACE alleges that changes in reporting requirements and the consolidation of two laboratories in some manner affect the reliability of audits under the quality assurance ? program." We are constrained by the Commission's Rules of Practice from allowing the NACE arguments to influence our decision. It has been longstanding precedent that motions to reconsider an order should be associated with requests for reevaluation of the order in light of an elaboration upon, or refinement of, arguments previously advanced; they are not an occasion for advancing an entirely new thesis.i2 NACE's petition was void of arguments that could have clarified the deficient statement of concern. 'the Motion for Reconsideration cannot sase that deficiency now." Therefore, upon reconsideration of the record before the Presiding Officer: M The Presuhng Othcer did take note of a procedural clanhcation included in the N ACE Reply concertung the nature of.the standing being requested in the proceceng by NACE and the Cherokee Nation. This informanon wouM not have needed a motum to be forwarded and acted upon by the Presiang oth6ci. " Reconuderanon Monon at 6-7. 12 Central flerrric Amer Cooperante. Inc (varpt C summer Nuclear stauan, Unit it CL1-8126,14 NRC 787. 790 (1981L orms Tenneuce valley Aurlwnrs (HartmPe Nuclear Plant. Umis I A. 2A, IB, and 2B), ALAB-418. 6 NRC 1. 2 0977) D it should be noted that sFC ed not serve the Preudmg ofhcer with a copy of us Answer to the NACE I Motion for Reconuderauon. although the Secretary of the Comnusuon and the other parties were served NRC .i Regulanons reqmre such numons to be hied with the Presiang othcer, therefore the Secretary had no in& canon i that a ctyy needed to he forwarded 10 C F R I 2 730 SFC mowd the Preueng othcer to consider the Answer even though n was received over 2 weeks late. However, unce the decinon to esclude the staternents of concern is grounded on pleaang dehciencies. the Answer was ist taken into consideranon in this deciutm 317 i 1 i I

c q y', - -l ~' b J y e.;.

l 3+<

.s ~ ^ ?' 1; 'Ihe NACE area of concern regarding managerial staffing adequacy and ' l 2 the extensive and highly technical decommissioning tasks remains excluded from ; litigation;. f:! g,. .- 2. ' The NACE area'of concern regarding the adequacy of ths quality; ~ ~ .E R . assurance program remains excluded from litigation. '. Be it So ORDERED. ' l! 'b e; James P. Gleason, Presiding Officer. ADMINISTRATIVE JUDGE - t-v, November 22,1994 - y,.;ay Rockville, Maryland : .i i I IN. 2I (': -i f n; '. j 1:i 'l i .,? 3 -. 9 ? ' t' .I 5 ~ ; } A 31N i .ta ? 'f- .i i i + f 1 -+ .( i i 1 -1}}