ML20203P195
| ML20203P195 | |
| Person / Time | |
|---|---|
| Site: | Fort Saint Vrain  |
| Issue date: | 10/17/1986 |
| From: | NRC COMMISSION (OCM) |
| To: | |
| References | |
| REF-10CFR9.7 NUDOCS 8610270177 | |
| Download: ML20203P195 (93) | |
Text
J ORIGINAL
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UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION In the matter of:
COMMISSION MEETING Briefing on Fort St. Vrain (Public Meeting)
Docket No.
Location: Washington, D.
C.
Date: Friday, October 17, 1986 Pages:
1 - 70 60 -RG7 ANN RILEY & ASSOCIATES Court Reporters 1625 I St., N.W.
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Washingt D
20006 p
PT9.7 (202) 293-3950
A s
1 D i S CL A I M ER 2
3 4
5 6
This is an unofficial transcript of a meeting of the 7
United States Nuclear Regulatory Commission held on a
10/17/86 In the Commission's office at 1717 H Street, 9
'N.W.,
Washington, D.C.
The meeting was open to public 10 attendance and observation.
This transcript has not been 11 reviewed, corrected, or edited, and it may contain 12 inaccuracies.
13 The transcript is intended solely for general 14 informational purposes.
As provided by 10 CFR 9.108, it is 15 not part of the formal or informal record of decision of the 16 matters discussed.
Expressions of opinion in this transcript 17 do not necessarily reflect final determination or beliefs.
No 18 pleading or other paper may be filed with the Commission in i
19 any proceeding as the result of or addressed to any statement 20 or argument contained herein, except as the Commission may 21 authorize.
22 23 24 25 l
i o
1 s
1 UNITED STATES OF AMERICA 2
NUCL5AR REGULATORY COMMISSION 3
4 BRIEFING ON FORT ST. VRAIN 5
6
[PUBLIC MEETING) 7 8
Nuclear Regulatory Commission 9
Room 1130 10 1717 H Street, Northwest 11 Washington, D.C.
12 13 Friday, October 17, 1986 14 15 The Commission met in open session, pursuant to 16 notice, at 10:05 a.m., the Honorable LANDO W.
ZECH, JR.,
17 Chairman of the Commission, presiding.
18 COMMISSIONERS PRESENT:
19 LANDO W.
ZECH, JR.,
Chairman of the Commission 20 JAMES K. ASSELSTINE, Member of the Commission 21 FREDERICK M.
BERNTHAL, Member of the Commission 22 KENNETH M. CARR, Member of the Commission 23 24 25
2 1
STAFF AND PRESENTERS SEATED AT COMMISSION TABLE:
2 ILLIAM C.
PARLER 3
SAMUEL J. CHILK 4
RICHARD F. WALKER 5
ROBERT O. WILLIAMS 6
ROBERT MARTIN 7
FRANK MIRAGLIA 8
RICHARD H. VOLLMER 9
KENNETH L. HEITNER 10 AUDIENCE SPEAKERS:
11 MICHAEL HOLMES 12 13 14 15 16 17 18 19 20 21 22 23 24 25
o 3
1 PROCEEDINGS
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2 CHAIRMAN ZECH:
Good morning, ladies and gentlemen.
3 Commissioner Roberts will not be with us today.
He had a 4
longstanding appointment and he asked me to relay his 5
apologies to the presenters this morning.
And he will read 6
the transcript and bring himself up to date on today's 7
testimony.
8 Today we're going to have an information briefing on 9
the current status of Fort St. Vrain operated by the Public 10 Service Company of Colorado.
This is an information briefing, 11 I emphasize, and we don't intend to take any vote on restart 12 today.
13 The Fort St. Vrain plant has had an operating 14 history that is certainly characterized as troubled.
The 15 plant's been operating safely and does represent a technology 16 different from other plants licensed to operate in the United 17 States.
However, the plant has been operating under low power 18 level restrictions and has not performed up to the 19 expectations of the designer, the licensee, or NRC either.
20 The licensee has been completing work needed to 21 satisfy the NRC equipment qualification requirements and to 22 implement Fort St. Vrain performance improvement program.
23 Today we'll hear from both the licensee and from 24 Region IV and NRR managers responsible for the plant.
They 25 will discuss the current status of the facility and the
4 1
readiness of the licensee to resume power operations sometime
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2 in the future.
3 Do my fellow commissioners have any opening remarks?
-\\
4 COMMISSIONER ASSELSTINE:
No.
Then I call on 5
Mr. Walker, the chairman of the board of the Public Service 6
Company of Colorado.
7 MR. WALKER:
Thank you, Mr. Chairman.
Good morning, 8
Commissioners.
It's our privilege to be here today and we 9
look forward to this opportunity to give you a report on the 10 status of St. Vrain.
I will handle the more policy and the 11 generic and those types of things.
12 As you well stated, Mr. Chairman, we have had some 13 difficulty in operating the plant, and certainly one of my 14 charges and my associates is to do a better job in operating 15 it.
That obviously has required management changes which we 16 have put in place.
17 And the other things which aren't necessarily 18 technical or necessarily related to safety involve some of the 19 other parts of my job and the problems the company has had 20 involving litigation that has surrounded the plant.
All of 21 this litigation at the state level, and of course, that's had 22 an impact on public opinion, what our customers think of us, 23 and those have been a concern to us.
24 And of course, I'm certainly dedicated to preserving 25 this technology.
And in order to do that, we found it
5 1
necessary that we will have to make some financial adjustments 2
in the way we've been operating to accomplish this.
We're in 3
the process of doing that, and I would like to review some of 4
those things with you at this present time.
I think we have 5
slides here, don't we?
6 (Slide.]
7 MR. WALKER:
You've probably read in the press and 8
it's probably been reported to you that we have what's called 9
a settlement agreement.
This comes out of the fact that since 10 Fort St. Vrain was put into our state, by our state utility 11 commission into the rate base, which happened in the early 12 part of 1981 as a result of a 1980 rate case.
There's been a 13 certain amount of concern by some of our customers, consumer 14 advocates, Office of Consumer Counsel, that since the plant 15 had not performed as it should that the customers were being 16 penalized.
17 And not to go into a lot of detail, the bottom line 18 is it boiled down to four lawsuits in the Supreme Court and 19 one in the District Court, and then a very major complaint 20 filed with our Public Utilities Commission.
These things 21 cause a great deal of concern because you never know how those 22 rulings will come, what your potential liability and all those 23 things were.
24 And I think more important, it was the air of i
25 uncertainty that affected our customers, affected our
6 1
employees.
And so, early this summer, late last spring I 2
decided that it was necessary that we try to come to a 3
resolution of these matters because it's no environment to 4
work in.
And certainly our customers owed some resolution to 5
this problem.
6 So we did reach a settlement agreement.
It's been 7
agreed to by all the litigants that evolved in all these 8
cases.
So all of those cases are now settled, the complaints 9
have all been stipulated out'and we do have a settlement 10 agreement.
11 If I could have the next -- well, before I go on.
I 12 will also then indicate as a result of this settlement 13 agreement and in line with what I indicated earlier about 14 getting ourselves in a financial position to continuing 15 operating the plant, involves a write-down from our retained 16 earnings for some of the things involved in the plant.
17 Also the third bullet on the slide shows that coming 18 out of this will be the necessity to look at some long-range 19 alternatives for the plant.
20 If I could have the next slide, please.
21 (Slide.]
22 MR. WALKER:
The settlement agreement, basically, I 23 think is quite unique.
What we have agreed to do is to remove 24 Fort St. Vrain from our utility rate base in the state of 25 Colorado.
What that means, that in future rate cases it's no
7 1
longer an asset that a rate of return or expenses against will 2
be included in what we call the base rates of our company.
So 3
we have agreed to do that.
4 We've also agreed, since our present rate structure 5
does contain a component related to St. Vrain and has since 6
1981, that we will reduce our electric rates effective October 7
1 by $29 million.
Percentage-wise this amounts to 3.15 8
percent reduction in electric rates.
It's accomplished by a 9
rider and it's just done on a kilowatt hour basis for our 10 customers.
11 We also agreed with this settlement that we would 12 not put any new electric rate increases in effect until July 13 1,
1988.
And we've actually agreed also on our gas rates i
14 which really isn't germane to this particular hearing.
15 In lieu of having the plant in rate base and 16 collecting a portion of our revenues associated with it on a 17 rolled-in basis, the commission has agreed to us -- with us, 18 that every kilowatt hour we generate we will receive 4.8 cents 19 per kilowatt hour.
One-third of that amount, 1.6 cents a 20 kilowatt hour is subject to escalation by a formula so as time 21 goes on that portion of it will be escalated.
It can never 1
22 drop below 1.6.
So the minimum is 4.8 cents per kilowatt hour 23 and as time goes on that will increase depending on the
\\
24 inflation adjustment.
25 The other thing that we had done, our commission in
8 1
one of the cases I talked about had ordered us to accrue 2
revenues for future refund to our customers.
Since it was in 3
litigation, the major portion of these monies had not been 4
refunded to the customers, but they had been taken through the 5
profit and loss statement and so the hit against net income c
6 if you want to state it that way, had already been taken on 7
most of this -- on all of this money.
8 We agreed then that we would refund to the customers 9
a portion of the accrued amount which is some $73 million.
10 This will be done in two increments.
The first will be in 11 December of this year, we'll refund $36.5 million.
And in 12 December of 1987 we will also refund $36.5 million out of this 13 money that has been accrued.
14 What this really does for our electric customers is 15 it gives them a reduction, with the rate reduction on October 16 1, with the refund in December, they'll receive approximately 17 a 5 percent reduction in their rates this year.
Next year 18 with the full year of the rate reduction and the refund, about 19 7 percent.
And from 1988 on, 3 percent until we would have 20 another rate case.
21 So it's my perception from the customers, and I 22 obviously can't speak for them, that the public opinion that 23 was somewhat adverse to St. Vrain, I feel most of that was 24 generated from the fact that they were paying for a facility 25 that was not providing them electricity, and that's certainly i
i 9
1 been the case.
And by this refund and the reduction of their 2
rates, I think their feeling or the general feeling is that 3
the so-called economic burden of St. Vrain on them has been 4
alleviated.
5 And parenthetically I might add, that this comes at 6
a pretty good time in our Colorado economy.
With the 7
agriculture, the energy business down, this is really a 8
windfall for our customers, particularly those largers ones 9
for this refund this year, next year, and in
'88.
So I don't 10 know how much credit I'm going to get for doing that, but at 11 least'in my own mind I think it's a good thing for our 12 economy.
13 COMMISSIONER BERNTHAL:
A matter of curiosity, this 14 4.8 cents, is that wholesale or is that cost of the -- I 15 assume that's wholesale.
16 MR. WALKER:
What we do, commissioner Bernthal, is 17 we have what's called an electric cost adjustment which is 18 figured each month.
And any purchase power we do, and any --
19 and it also adjusts for fuel cost at our fossil plants.
What 20 this will do will go into that electric cost adjustment at 4.8 21 cents for each kilowatt hour and the customers -- then it 22 would be passed on to our customers.
23 Since this plant is not in rate base we would be 24 entitled to sell this power to somebody else if we wanted to 25 because it's not in rate base anymore.
Our present plan would
10 1
be to sell it back to the company at the 4.8 cents.
2 It's not too different, Fred, than the co-generation 3
independent power producer rate type of an arrangement.
And i
4 that's really where the genesis of the settlement came from.
5 One small item -- and I guess it really isn't small, 6
but as you know in most rate cases you have people that are 7
intervenors to look after the interest of those people that
+
8 can least afford to pay for their electricity.
And as part of 9
that settlement, our company does have what's called an energy 10 assistance foundation which does provide funding each year --
11 it's partly our funds, partly matched by our employees and 12 customers -- to help those people that are not eligible for 13 federal programs to pay their electric and gas utility bills.
14 So as part of the settlement, each year we will add 15 an additional $1 million to the electric -- this energy 16 assistance foundation to help those.
And that was one of the 17 things that came out of the settlement.
18 As I indicated earlier, all the legal proceedings 19 and all the claims and complaints have actually been dropped 20 against St. Vrain, so we don't have that stigma over us and 21 the uncertainty of what the Supreme Court might do or what the 22 commission might do in future proceedings.
And the Office of 23 Consumer Counsel, the PUC, the other intervenors and ourselves 24 are all in agreement on this, and I certainly give them credit 25 for in this short period of time being able to stipulate and
11 1
remove this legal impediment to our proceedings.
2 So there's a lot more details that go into this, but 3
I think that gives you kind of a broad brush of what we've 4
been able to do.
And I feel very good about it, that we've 5
been able to do that.
And I think the public opinion towards 6
St. Vrain will be much improved, because most of it has been, 7
this has been an economic penalty on us to have to pay for 8
something that hasn't produced.
And I think we've alleviated 9
that now.
They'll only pay for what they get.
10 COMMISSIONER ASSELSTINE:
You're embarked on a 11 fairly significant effort in terms of making an investment in 12 the plant, fixing some things that needed to be corrected for 13 a while.
That's obviously not an inexpensive effort on the 14 company's part.
15 What's the relationship between the settlement 16 agreement and these new financial arrangements and the 1
17 company's ability to continue to invest fairly substantially 18 in upgrading Fort St. Vrain for the future?
Is that something 19 that you're looking at right now or can you give us some l
20 indication of your ability to continue to make the kind of 21 investments that you've been?
22 MR. WALKER:
As you probably know, Jim, in the last 23 year, of course, we spent a considerable amount of money on i
24 the refurbishing of the control rods.
And of course, that 25 money has already been spent, and I'll get to the next and l
12 1
what the remaining investment in the plant and what we've done 2
with that plant investment.
3 This year, of course, we're spending a substantial 4
amount of money in some plant upgrades and a considerable 5
amount on the environmental qualification work and to bring us 6
up to date.
I guess your question goes about future 7
expenditures that will be needed.
8 COMMISSIONER ASSELSTINE:
Right.
9 MR. WALKER:
I guess I would say, I really feel that 10 we have a better handle on this now because we do know if you 11 can make a reasonable judgment on spending X dollars, if it 12 would give you this much improvement in availability, then you 13 know exactly how many dollars that is for you and you can do 14 your cost benefit on that sort of thing -- on those things 15 that relate to availability.
So it does give us a pretty good 16 handle on a mechanism for doing that.
17 And certainly, part of this will relate to what we 18 do very long range into the '90s, and those things that would 19 have benefit there versus those that have short term benefit.
20 I think we do have a better mechatism, and Mr. Williams will 21 get into some of the things we're doing short term in his part 22 of the presentation.
23 COMMISSIONER ASSELSTINE:
Okay.
Does the fact that 24 in the future, basically you're only going to charge for what 25 is actually produced from the plant, does that bound you in
13 1
terms of certain assumptions you have to make on your 2
reliability and availability of the plant for the future in 3
order for it to be a viable concern?
4 MR. WALKER:
Well, I think we wouldn't make an 5
expenditure unless it would increase the reliability and 6
availability.
I mean, if it really didn't do that you 7
shouldn't spend the money.
And of course, if you get better 8
availability and reliability you're going to produce more 9
kilowatt hours and you get more revenue.
10 So you have this mechanism, which I said before, is 11 a much more specific way of doing it than we had in the past 12 where if you make an investment in a facility then at your 13 next rate case it's up to you to get that put into the rate 11 base and earn a return.
Presumably, you can get it in if it's 15 a prudent investment, but you don't know until down the road 16 how that's going to work out.
This way you do know, you do 17 get this much if you can get those extra kilowatt hours.
)
18 CHAIRMAN ZECH:
How would it affect though -- excuse 19 me.
20 COMMISSIONER ASSELSTINE:
Go ahead.
21 CHAIRMAN ZECH:
How would it affect though your involvement in conditions at the plant that concern safety?
22 l
23 MR. WALKER:
Safety, you don't make that analysis on 24 safety.
If it's required for safety in the operation of the 25 plant, then -- and those commitments were made or those we
14 1
might have to make -- but those expenditures have to be made, 2
Mr. Chairman.
3 I'm talking about thinga that maybe aren't safety i
4 related but might get you a better availability of the cooling j
5 tower, or you know, you can pick any one thing where you now 6
have a good mechanism of deciding should I spend X million 7
because it will give me a little more availability.
8 COMMISSIONER ASSELSTINE:
Is.there a break-even 9
point in terms of availability that you're looking at where 10 the project makes sense versus not making sense?
11 MR. WALKER:
Yes, if I could go into the next part 12 of this, I think that will probably bring up some of those 13 questions.
14 Since we have all this settled, and recognizing now 15 that this plant is not in rate base and we know what the 16 revenue stream is, it was certainly apparent to us that 17 without some adjustment financially that this would not be a 18 viable economic venture for us.
So it was necessary to make 19 some adjustments.
And the kind of adjustments we have made 20 fall into three categories.
21 One, is to write down the investment in the plant.
22 And by write down I mean you take that plant that you don't 23 think you can recover or make a return on and you actually 24 write it down against the retained earnings of your company.
25 And of course, that boils down to taking a hit against your l
15 1
not income in the quarter that you decide to do that.
That's 2
on the plant investment side.
3 As you know, in our plant the first nine segments of 4
fuel that have been used at the plant, including the six that 5
are in the core now were actually given to us by the General t
6 Atomic Company at the time of the settlement, so there's no 7
fuel cost associated with that.
8 We had gone forward and had ordered additional fuel 9
for the plant.
Segment 10 has been completed and is ready and 10 is in storage and is capable of being put in the plant.
That 11 has been paid for.
We had also made some investments in 12 Segments 11, 12 and 13.
13 Looking at this situation, I think it gets to your 14 question a little bit, Jim, is that it's probably not going to 15 be possible for us to recover enough from this type of revenue 16 arrangement to pay for that fuel.
So we have made the 17 decision that we are going to write down the value of the 18 fuel that we now have, Segment 10, plus what has been spent on 4
19 11, 12, and 13.
This amounts to $76.7 million.
20 So what we're really doing in this third quarter t
21 will be expensing all of that fuel against retained earnings.
22 So in effect, what that means for Mr. Williams and his 23 operation in the next three or four years is he will have zero 24 fuel expense, because I've taken that against our net income 25 in this quarter.
Because it looks like it will be very n-m-yn w w w-m-,ww,vww-
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16 1
difficult to recover that, and you'd just as well face those 2
facts when you can see them coming, so we've done that.
3 The other component which is rather unique is the 4
decommissioning expense.
As you know better than I, in all 5
plants there is a need to collect revenues so that when it 6
does come time to decommission, regardless of when that time 7
is, you do have to have the money to do the decommissioning.
8 And we recognize that.
We also recognize this plant may have 9
a shortened life, and that we might have to -- and that also 10 to have a revenue stream that would cover this that we should 11 also write that expense down.
12 So what I'm really doing is pre-expensing the 13 decommissioning expense, which is about $95.4 million that 14 really will be expensed.
And there's a little -- I want to 15 explain a little more on that.
So that when it comes time to 16 decommission, this will not hit your expense statement.
It 17 will come from this accrued account.
18 Now I need to back up a little on that.
As you 19 know, in the operation of the plant our commission has allowed 20 some recovery of decommission expenses in the past, which have 21 been accrued, which amounts to about $6 million.
22 At the time of the settlement I just spoke about, we 1
23 did make the case, and the commission agreed with us and the 24 intervenors, that the plant had had some useful life.
It had 25 provided electricity for our customers and that we ought to be
17 1
entitled to some additional money from them for 1
2 decommissioning.
3 So the commission -- this was a negotiable item on 4
how we came to it -- but they decided that $11.5 millino of 5
additional decommission expense was legitimate and could be 6
collected over the next five years.
So taking that, the 6 7
million already, the 11.5 which the commission will let us 8
collect over the next five years leaves us about 77.9 million 9
to be written down.
10 So what I've really done here is made the fuel free 11 through Segment 10, which incidentally would run us until 12 about 1990.
I've also answered the question on 13 decommissioning.
We have set that money aside so that when it 14 comes time to decommission, that money is available and will 15 not have to go through the expense sheet.
16 The third piece of the thing is writing down the 17 investment in the plant.
And just to remind you that this 18 plant does sit on a very valuable site.
It has very valuable 19 water rights.
And of course, in our part of the country, land 20 and water are the key ingredients and are very valuable.
It 21 also has natural gas, but that's probably another story.
22 Also, our plant has -- contrary to the other plants 23 that you have jurisdiction over, does have high temperature 24 steam, high pressure, high temperature steam conditions, our 25 turbine generator has the same temperature and pressure
18 1
conditions as our modern coal-fired units.
2 So what we decided to do in the write down, is to 3
write down all but those parts of the plant that would be 4
useful in another mode of generation.
That turbine generator 5
could just as well be fired by a gas-fired boiler or a 6
coal-fired boiler or another nuclear -- and the land, the 7
cooling towers, the switchyard and all that.
8 So what we've done is really written down the 9
nuclear related investment, and we will take a hit against net 10 income for that investment if it's nuclear related.
That 11 comes down to about $69.8 million plant investment that will 12 be useful for a great number of years, and it's our feeling 13 and our accountants feeling that there will be ample 14 opportunity to earn on that $69 million investment, which is 15 really not nuclear related investment.
16 There is another piece that goes with this.
The 17 commission also recognized like they did on decommissioning 18 expense that the customers had received some benefit from the 19 plant.
And of course, the figures I'm talking about are net 20 of prior depreciation that's been claimed against the plant.
21 But there is some future -- this was a negotiated item, and 22 they've agreed that $22 million of future depreciation could 23 be applied against the total plant investment.
So they're 24 allowing us -- and that is in the rates for the next five i
25 years.
So we do get that $22 million.
19 1
The bottom line of this then is we end up with a 2
plant at year and with about $69.8 million in plant 3
investment, net plant investment that's all useful.
In my 4
feeling, no matter which direction we go in the '90s, the 5
fuel that we have on hand that will be able to run the plant 6
until '90 has already been expensed and paid for.
The 7
decommissioning expense has already been expensed against net 8
income.
9 When you get through with all this you do end up 1
10 then with what we call a write down, and it will be against i
11 our third-quarter net income in the range of $75 to $100 12 million after tax hit on our net income for the third 13 quarter.
The exact figure is not available yet because of tax 14 considerations, accounting, auditing and getting all this 15 done.
But it will be in that range, and we have so disclosed.
f 16 That's really what we've decided to do is to get 17 this plant, get those expenses out, get that investment down 18 so we've got a reasonable shot at running.
So really when you 19 digest this it gets down that you really just need to cover 20 your operating and maintenance expense.
You don't have to 21 worry about the decommissioning expense, the fuel expense or 22 the return on major investment.
23 So we think that gives our operating people a fair 24 shot to do this.
And as I indicated earlier, I do want to 25 preserve this technology.
I do want to use that fuel, and I
20 1
think there's no reason whatsoever that it can't be run and 2
all of us be winners if we run this through at least 1990.
3 Which brings me to the third bullet on the other one 4
was, which was indicated, long range studies.
We obviously, 5
since I've taken care of these things, the question comes what 6
do you do when you've used up Segment 10 of the fuel, which 7
would be about 1990.
What do we do then?
Because at that 8
time it would require us to buy the fuel.
9 So what we will be doing -- and there's no need to 10 do this immediately -- is to look at what are our options 11 starting in 1990, and they're fairly straightforward.
One 12 option would be to decommission the plant at that time and 13 convert it to a fossil-fired generating facility; probably 14 coal.
It's a possibility it could be run on natural gas for a 15 short period of time, but we would need to make that study to 16 see what the costs are.
17 A second alternative would be to see if there was 18 enough interest in the industry that would pay the incremental 19 cost of the fuel to allow us to operate two years, four 20 years.
We could cover our O&M expenses, and if someone was 21 willing to keep this technology going, certainly that 22 opportunity exists.
And I would also tell you that if 23 somebody's willing to do that, to the fact that it would make 24 the plant run better and we'd recover more than operating 25 expenses, we'd be glad to share those with the people that
21 1
would do it.
2 The third alternative, which I don't think would be 3
viable but needs to be looked at, was.just to actually 4
decommission the plant and sell the land, sell the water, sell 5
the equipment, and just get out of it completely.
That 6
doesn't make a lot of sense to me because plant sites and 7
water are valuable and I don't know -- but we, Mr. Williams 8
and I will be putting together the scope of doing this work.
9 And we want to do it carefully and see what those options 10 might be starting in
'90.
11 The other thing, that does'give us time, no matter 12 which option we take to do all the things that are going to be 13 required no matter which one of those you do.
I mean, to do 14 the decommissioning takes preparatory time, permission from 15 you folks.
If you're going to convert to coal, that requires 16 permits, requires engineering and those things.
And I think 17 we can all come out winners if we -- we have from now until 18
'90 to make those decisions and come out and decide where we 19 ought to go in that particular vein.
20 COMMISSIONER BERNTHAli r :.oVt understand the 21 situation with the fuel.
Do you now own the fuel 22 manufacturing --
23 MR. WALKER:
No, we don't, Fred.
That is owned by 24 GA Technologies.
And of course, that facility has been kept 25 in operation and was used to fabricate the fuel -- the nine
22 1
segments we received free.
And then they did fabricate for us 2
Segment 10, which has been --
1 3
COMMISSIONER BERNTHAL:
But nothing beyond that yet?
4 MR. WALKER:
They have done some work on 11, 12, and 5
13.
There's been -- each one is in -- very, very little done 6
on 12 and 13.
There's also costs in there in keeping the 7
facility in operation.
You can't -- you know, you have to --
8 even though you're not manufacturing and putting anything out 9
the door, you have to keep it in ready --
10 COMMISSIONER BERNTHAL:
But I was under the 11 impression that GA had at some point --
12 MR. WALKER:
Had sold it to us?
13 COMMISSIONER BERNTHAL:
-- talked about or offered 14 the option of spinning that off to you.
15 MR. WALKER:
Probably what you're thinking of, Fred, 16 in our fuel contract there is the provision -- and I don't 17 know the words exactly -- that if they should go out of the 18 business there was a provision that we would have the 19 opportunity to buy the technology.
20 COMMISSIONER BERNTHAL:
I see.
21 MR. WALKER:
I think that's a provision in the 22 contract.
That's a lot of ground I've covered in a very short 23 period of time, and it doesn't really relate a lot to the 24 technical issues.
i 25 But I might say just in conclusion, certainly I feel
23 1
good about what we've done.
I think our customers feel much 2
better.
The fact that our customers feel better is much 3
better for the morale of our people.
We have bitten the 4
bullet financially.
We have taken somewhat of a beating on 5
our stock for,doing this.
But you know, we have gotten rid of 6
the uncertainty that existed out there and at least people 7
know where they stand.
8 I am an advocate of the technology and I think we've 9
put together a method here that we can probably keep this 10 going for another three or four years.
So I feel reasonably 11 good about it, in spite of all the trauma that we've gone 12 through the last three or four months.
13 COMMISSIONER ASSELSTINE:
What do you estimate the 14 fuel costs would be on an annual basis beyond 19907 15 MR. WALKER:
I really haven't had any discussions, 16 Jim, with the GA Technologies people and I would hesitate to 17 come up with a figure.
Certainly the process is there and you 18 do know the cost to SWUs and things and the real key would be 19 what they would be willing to do on fabrication costs for 20 future elements.
21 COMMISSIONER BERNTHAL:
What was Segment 10?
What 22 was the cost of that?
23 MR. WALKER:
The total cost of Segment 10 -- and 24 that includes everything and the fact that we've had an 25 interest on it -- is about $45 million for Segment 10.
That's
24 1
what we've accrued on the books.
2 CCMMISSIONER BERNTHAL:
It wouldn't be less than 45 3
million, I guess.
4 4
MR. WALKER:
Well, you have to be a little careful, 5
Fred, in that we've had some of that for a time and there's 6
some interest build-up on it.
If you could do it on a little 7
more orderly basis so that you don't have the carrying charges 8
for such a long period of time.
Because when we ordered that 9
we had hoped -- and we didn't know about the control rod 10 problem and those things -- that we would have been on a 11 schedule where that Segment 10 would have already been used in 12 the core.
13 COMMISSIONER ASSELSTINE:
Is decommissioning an 14 easier task for this plant?
I know the plant is substantially 15 cleaner in many respects than an LWR.
16 MR. WALKER:
We would think -- it's much cleaner.
17 As you know, the activity and certainly any of the equipment 18 outside the pre-stressed reactor vessel would be very easy to 19 do.
And I think as most of you know, we've had a lot of 20 experience of removing the circulators for repair work and 21 that has not been too difficult a task to take those our, 22 clean them up and work on them.
23 And then when we did the refurbishing of all the 24 control rods in the hot cells, we were able to do that in a 25 reasonably good fashion.
There will be the internals of the l
25 1
reactor itself, of course; the core barrel and those sort of 2
things which will be the major task involved in the work.
3 COMMISSIONER ASSELSTINE:
I suspect your $100 i
4 million, or roughly $100 million estimate may tell us more 5
about the validity of $100 million for light water reactors.
6 MR. WALKER:
I have no -- I don't -- my knowledge in 7
the pressurized water, what's required to do, I don't know.
8 COMMISSIONER ASSELSTINE:
Okay.
9 MR. WALKER:
We've had a detailed study made and 10 very detailed on how you would take this out by pieces and all 11 that sort of thing and that's the figure.
Obviously, it will 12 cost what it costs when you get down to it.
13 I might add parenthetically, we've reserved this 14 money for it, and obviously, if when we get to the time to do 15 it, if it runs less than this, then that's a credit back to 16 net incore.
If it costs more then that, that will have to be 17 taken against net income at the time that it's done.
And 18 that's an obligation we have.
But I think we've minimized our 19 future risk in that by setting this aside.
20 COMMISSIONER BERNTHAL:
What do you expect to do i
21 with the graphite?
As a first step, or a last step, perhaps.
22 It's reactor grade, but presumably you don't have all options l
l 23 on what to do with it.
Has there been any thought about that?
t 24 MR. WALKER:
I don't remember the exact details of 25 the deccmmissioning plan, Fred, but that certainly was given i
26 1
consideration and there will be different levels of wasta 2
material that comes out.
Some low level that can go to a lov 3
level one.
And obviously, the fuel is the thing that will 4
have to go first.
And then in between the fuel and the very 5
low level --
6 COMMISSIONER BERNTHAL:
The graphite wouldn't be 7
waste, presumably.
Or would that be?
8 MR. WALKER:
Well, that that's in the core, I don't 9
know whether it has any salvageable -- if that's what you're 10 getting at -- value at all.
11 COMMISSIONER BERNTRAL:
Yes.
12 MR. WALKER:
We certainly haven't counted on it 13 having any salvageable value.
14 COMMISSIONER BERNTHAL:
It may not, I don't know.
I 15 was just curious.
16 MR. WALKER:
I don't know.
It's a little hard to i
17 visualize whether it would or not.
But I'm not a real expert 18 in that area.
19 CHAIRMAN ZECH:
Let me just note that we've taken l
20 more than the 30 minutes allotted already.
Is there more to 21 talk about?
l 5
22 MR. WALKER:
I apologize.
23 COMMISSIONER ASSELSTINE:
It's our fault.
24 CHAIRMAN ZECH:
It's very important, but we have two 25 other presentations and if you have more in your presentation
27 1
-- I presume Mr. Williams is going to discuss something.
2 MR. WALKER:
Yes.
Mr. Williams was going to cover 3
very quickly some of the technical, where we stand in 4
milestones.
5 CHAIRMAN ZECH:
Well, we spent a lot of time on the 6
financial and other matters which you've discussed.
I 7
appreciate that, Mr. Walker, it's very important.
But I 8
really think we should move into the technical area and 9
operational area and be as brief as possible because we have 10 two other presenters.
11 MR. WALKER:
Mr. Williams is our vice president of 12 nuclear operations.
I brought him on board July 1.
He had 13 a distinguished career with Rockwell International, in charge 14 of all of their nuclear programs, Rocky Flats, Hanford and the 15 whole works; a graduate nuclear engineer.
He's forgotten more 4
16 about nuclear engineering than I'll ever know.
And I'm very 17 proud to have Mr. R.O. Williams reporting directly to me.
l 18 CHAIRMAN ZECH:
Thank you very.much.
Mr. Williams, 19 proceed.
20 MR. WILLIAMS:
We want to review the recent SALP 21 findings that we reviewed with both the region and 22 headquarters.
And our evaluation of where we are in current 23 status, the kind of root cause evaluation we've found, and the 24 kind of corrective actions that were taken.
25 In general summary, we have found that throughout
28 1
the entire set of SALP ratings that there's a management overtonewithrespecttogachoftheseratingsintermsofthe 2
3 performance issues that are there, tend to focus primarily.on 4
how well we're managing of that functional area, rather than 5
the details of the functional area itself.
So it's the i
6 management issue, I believe, that the SALP evaluation focused 7
very heavily on the management issue that we found.
.8 Structurally, as I came on board we had four 9
separate, what we call divisions which comprised the nuclear 10 organization.
Each of those divisions tended to operate to a 11 degree of autonomy.
So that the interaction between the 12 divisions was not as strong as it could be.
It was an l
13 observation, I think, that we were making, and certainly an 14 observation that the Commission made in their evaluation of 15 the performance as they saw it.
I think many of the actions 16 that they were concerned about reflected this lack of strong 17 interaction between the four groups.
l 18 Each of these four groups had been working on an 19 annual plan basis developing their attempts to make corrective 20 actions for what they saw were the issues and deficiencies in j
21 their performance.
And I've evaluated and reviewed all of a
22 those plans.
And those plans in and of themselves, in terms i
23 of their self-assessment and so on, I think were fairly well 24 on the mark in terms of the issues, the identification of 25 issues, and the kinds of corrective actions that they were 4
29 1
attempting to make individually as functional activities.
2 Another activity that I engaged in early on was a 3
review right to the supervisor level with every supervisor 4
within the organizdtion.
So I reviewed each of the functional 5
units and found, you know, how are they functioning.
And 6
particular, with our concern for quality and the perception of 7
whose role is it in quality, whether it's the quality 8
organization versus the doing organization and so on.
So we 9
spent quite a bit of time concerning ourselves with their 10 perception of their role in the quality activity, and how 11 their resources -- the resources that they had -- were being 12 applied to the various jobs that they had.
13 We then, again, looking toward building the team, 14 bringing the four separate organizations together as a single t
15 organization, we reviewed that, developed a focused mission 16 statement for ourselves.
Each of the organizations recognizes i
i 17 themselves supporting that focused statement, rather than i
l 18 operating to their own individual level statement that they 19 were operating to before.
20 Looking at the organization, looking at the
+
21 structure of the organization, comparing that with 22 organizational structures that I've operated under myself in 23 various settings and the structure that I've been able to 24 compare with other operating plants, the way we have 25 constructed the boxes on our organizational chart, the wiring i
I l
4 30 1
diagram if you will, is not a fundamental problem.
That 2
diagram is, I think, in very good shape.
3 And certainly, the issues of interaction between 4
organizations are in there.
And those were the kind of issues 5
that we started out with at the top level as probably our key 6
management issue.
But it's not an issue in terms of 7
structure, basic structure there.
8 Again, going back to the theme of the quality, of 9
the way we view the work, because that to me was a very 10 important factor to start out on, because I think the quality 11 is key to, as you say, the operational safety interest that 12 are there.
The safety and the operation, and really what I 13 view the perception of quality and how we approach the work.
14 I think there is a strong individual commitment.
As 15 I talked with both the managers and employees and so on --
16 CHAIRMAN ZECH:
Would you move the microphone a 17 little closer to you, please?
18 MR. WILLIAMS:
There is a strong individual 19 commitment to quality.
I think there is a real problem in the 20 lack of consistency in our applying basic, fundamental 21 principles of management in terms of the planning, 22 organization, the leadership, and the control functions that i
23 need to go with that.
24 So what we've been focusing on has been how do we 25 shift the organization to a more effectively managed
=.
31 1
organization.
And what I have done -- if I can have the 2
number six slide there --
3 (Slide.]
l 4
MR. WILLIAMS:
-- is establish with the division and 5
the next department level -- the next level of management down 6
-- I have established a senior planning team which essentially 7
brings both the department level manager and the division 8
manager together with me on a weekly basis.
And we have had 9
the action going on since about mid-August.
10 And I believe we are making progress in improving 11 the management process, the identification and prioritization 12 of issues, the tracking of issues.
The control aspect is 13 certainly there.
And it does represent all of the f
14 organization elements that need to be present and a part of 15 many of the management decisions.
So they're operating at a 16 level there where I think we are working very effectively.
17 Issue-specific kind of things that involve several 18 parts of the organization, we're addressing through the 19 establishment of task forces.
One of the issues in the SALP 20 review, for example, was in design control.
We have in that 21 functional organization that I described, we have engineering 22 and design in various elements of the organization.
And I 23 think some of the difficulties we've had has been in the way 24 those organizations have functioned with each other.
And the i
25 way the engineering organization has interacted with the other
32 l'
components of the organization, such as procurement, quality 2
and the operations and licensing.
3 So we have established, for example, a task force in 4
that area to address both the controlling procedures that we 5
have in there and the functional interaction between the 6
various organizations.
So that's an example of a specific 7
task force that we've set up in there.
8 And we are working at establishing and improving 9
performance tracking so that we identify an area that needs 10 performance tracking and get that on a regular weekly review l
11 of monthly review so that we can look at individual elements 12 of performance, both in terms of management and plant i
13 parameters and safety parameters and quality parameters.
For 14 example, how responsive are we in terms of prompt response to 15 the various issues.
16 And those things we are going to be tracking on a 17 regular basis in those meetings, and I'll have sort of an 18 instant feedback and an instant correction right there are the 19 meeting because the people that are involved and directly 20 concerned with the performance are there to respond to that.
21 So we believe that those kinds of actions, we are 22 making progress in there, we are getting some -- we are seeing j
23 improvements in planning.
Planning has been an area of 24 considerable concern.
It has been fragmented.
We are working 25 very hard at getting that controlled, and there is, what we l
-,-,,--r-.----,mn_
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. - - -, -. - -, - - - - -, - -,, - - - - - - - _, _, - -, -,.,,. ~., - -, - -
n-
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33 1
call a master planning and scheduling organization which 2
supports this staff meeting cut a regular basis and provides us 3
top level planning summaries for the. entire organization in 4
terms of establishing common organizational targets.
5 So we all understand what our major goals are, what
]
6 our major commitments are.
What, for example, are those 7
things that we absolutely have to have in place before, for 8
example, the Commission will continue a restart for the 9
plant.
We get those top level things and so we have everybody 10 understanding what those actions have to be to support our 11 common goals in that direction.
12 We have been using -- and that's again, directing 13 ourselves to the management issues, we've been using both 14 internal and external support in developing plans for 15 enhancing the management performance through increased 16 training, evaluation of the managers, and an appropriate 17 tailor-trained each manager's -- if I do strengths and deficiencies on managers, I find those things that he needs 18 19 improvement in -- he/she -- and focus the training and the 20 performance enhancement right on the issues that that manager 21 has as we get those out of various types of surveys that we 22 are -- management type surveys that we're using to evaluate 23 the managers, individual management performance.
24 That is, all the managers throughout the 25 organization are a part of that program, and that's an ongoing t
,---,.--,,~.-,-,~e,.r-m
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4 34 1
and immediate program we're addressing.
2 And that would lead me to that being, in fact, a 3
part of the PEP program.
It's a part of what we call the 4
total responsility management element of PEP.
The PEP is our 5
performance enhancement program.
We are continuing the use of 6
that program and are constantly addressing our timely 7
implementation of those things that we have committed to in 8
the PEP program in terms of enhancing the overall performance 9
of the organization.
10 But I would have to agree with those findings that 11 both the region and headquarters in their essential summary 12 that it is principally the way we have been managing the 13 enterprise.
We really do have to continue to attack that.
I 14 And I believe as we make progress in that area, that we will 15 find that that same kind of enhanced performance in management 16 is going to reflect itself in each of the functional areas of 1
17 the SALP ratings.
And we are actively pursuing the 18 improvement of those ratings over what we currently 19 experience.
20 Now in connection -- and I think your opening 21 comments indicated that we would be discussing in today's l
22 meeting some of the restart issues associated with the plant.
l 23 We are very actively pursuing the environmental qualification 24 activities that will lead to closure of that program and an 25 acceptable environmental qualification condition for the i
4 y, _ _,.. _ _ _ _ _ _ _ _ _ _ _ _ -, _ _., _ _.. _. _ _ _,,,
35 1
plant.
2 In the course of the environmental qualification and 3
Appendix R examinations that we have been making, we have come 4
up with issues with respect to the analyses in the FSAR on 5
safe shutdown cooling, safe shutdown cooling paths.
And what 6
we have found is that we have not been able to, on going back 7
and examining the FSAR assumptions in terms of safe shutdown j
8 cooling paths at 100 percent power operation, that is assuming 9
a long-term 100 to 105 percent power operation and and of life 10 core conditions that were assumed in the FSAR analysis, we i
11 have not been able to go back and reaffirm that analysis to be 12 able to support that.
13 So we have been looking at those power levels, 14 through the analysis process, determining those power levels 15 that will in fact support those shutdown cooling paths.
Those 4
16 power levels obviously being less than 100 percent.
17 We have also examined our operating history and 18 determined, that is what power level can we analyze and say 19 that, in fact, we have not exceeded a condition thr.ughout the l
20 operating history where we would not have been able to 21 maintain and sustain a safe shutdown cooling path.
And we 22 believe we're making good progress in those particular areas 23 and we're comfortable that that analysis appears to be coming i
24 out, that there is no historical aspect to this that we would 25 have to say we had some deficiency in shutdown.
36 1
On the other hand, we have not -- Fort St. Vrain, 2
I think-if you look at the FSAR, has a number of safe shutdown 3
paths that were developed in the FSAR -- far more, probably, 4
than other plants.
And simply because there were there, let's 5
add another path.
And I think they added these paths, and for 6
example, the last path that we have is the use of fire water 7
with the reheater portion of the stera. generator.
8 We have an evaporator, economizer evaporator 9
superheater portion and then a reheater portion.
And we have 10 one mechanism which uses what we call the EES, the economizer 11 evaporator superheater, and then another shutdown path which 12 uses the reheater, which is sort of the last path that we have 13 with fire water.
And that's the one that's been giving us the 14 greatest difficulty in terms of being able to support that 15 path.
16 So we are looking very hard at that and have had 17 some preliminary discussions with the Staff with respect to 18 the retention of that particular path within the FSAR.
That 19 may have to be in the longer term a reexamination of the 20 retention of that particular defense-in-depth.
And our 21 defense-in-depth is almost to a point where it's too many 22 defenses-in-depth and that last one is just not quite as 23 defendable as we thought we had there.
So that's the issue, I 24 think, with respect to safe shutdown cooling.
25 We believe with modifications, some modifications to
37 1
the EES section of the steam generator that we can support 2
very nominal power levels -- probably not 100 percent.
But 3
our current calculations and estimates indicate that we could 4
probably get to 85 percent, 70 to 85 percent with 5
modifications to that system.
6 So we are looking at what kind of conditions that we 7
can support today with no modifications to the system, and 8
with all of those systems in place as described in the FSAR, 9
and what modifications and possible amendments to the FSAR 10 would be required to allow us to operate at the 85 percent 11 power.
12 COMMISSIONER ASSELSTINE:
So basically you're 13 talking about a derating somewhere on the order of 75 to 85 14 percent?
15 MR. WILLIAMS:
That would appear to be the first 16 action that we would be taking on a longer term basis.
And 17 that, by the way on the next chart if I may have that, page 9.
18 (Slide.)
19 MR. WILLIAMS:
We are talking, for example, on that 20 schedule, the phase -- what we're referring to there is Phase 21 I safe shutdown cooling are utilizing the existing cooling 22 paths, no modifications to the FSAR, what power level can we 23 support as is with the environmentally qualified systems that 24 we would have.
We would have environmental qualification 25 completely in place, and through the reanalysis of the FSAR we
38 i
i l
1 would determine that power level that would support all of 2
those conditions.
3 What we call Phase II safe shutdown cooling 4
represents those modifications to the system that would be 5
required together with the amendment to the FSAR, in all 6
likelihood, to remove that reheater section from all of the 7
defense-in-depth.
It's the last defense that's there and it 8
represents the lowest level of that defense-in-depth and we 9
believe that that's one that could be addressed.
And we have 10 had, as I say, preliminary discussions with the Staff.
l 11 CHAIRMAN ZECH:
Looking at that chart you say NRC 4
4 12 restart approval.
Would you clarify for me when do you 13 anticipate approval?
What's the date you're talking about?
l 14 MR. WILLIAMS:
This chart assumes and sets out a
)
15 completion of EQ work -- as you'll notice right up here we i
16 have -- if I take the top of the chart with the shutdown work l
l 17 complete, we're seeing that complete essentially around the 18 first of December.
-19 The EQ I&E inspection, I had a very broad line in 20 there because we were in discussions with Staff in terms of i
21 the point at this I&E should come in and inspect.
We had 22 discussions earlier with the Staff and we have, I might 23 add, since determined that in fact we now anticipate the EQ 24 I&E inspection to be the week of January 5th.
So that broad 25 line in there, I think, would still representation 1
1
39 1
-interactions with the Staff, but the very specific EQ 2
inspection will be the week of January 5th through the 9th, in 3
terms of our current --
4 CHAIRMAN ZECH:
Then when would restart approval be 5
anticipated?
6 MR. WILLIAMS:
See then that establishes the 7
completion of the EQ work, those findings that would come out 8
of the I&E inspection.
And then the restart approval is.
9 assuming restart approval somewhere around the middle of j
10 February.
l 11 CHAIRMAN ZECH:
All right.
i 12 MR. WILLIAMS:
The assumption that goes with that, j
13 as you notice at the bottom of the chart, is an approval for
{
14 operation to 8 percent power in connection with some dryout f
15 requirements we have for the helium system.
1 l
16 And that type of power would be -- we're assuming 17 that we would be able to do that during December.
That is, 18 we'd not be using the -- there would be no power operation in t
l 19 the sense of the generation of electricity, but it's an 20 operation up to an 8 percent power level -- essentially a 21 low power level for the purposes of drying out the core.
j 22 The dryout is the fact that there is a small amount 23 24 CHAIRMAN ZECH:
So essentially you'd be asking for 8 25 percent power level approval at what time?
f
40 1
MR. WILLIAMS:
In December..
2 CHAIRMAN ZECH:
In December.
3 COMMISSIONER BERNTHAL:
Why is the core wet, if I 4
may use that term -- damp?
5 MR. WILLIAMS:
When the circulators go down you get 6
some amount of -- you can get through an accumulator firing 7
you can get some moisture in there.
We feel that we have some 8
of that.
And we have not been, under the conditions of the 9
system right now, we are not able to do any dryout.
We cannot 10 take moisture out of the helium, so we have an accumulation.
11 It's not a great amount, but there is a --
12 COMMISSIONER BERNTHAL:
Just the normal accumulation 13 from a shutdown?
14 MR. WILLIAMS:
Just the normal accumulation that 15 would occur through a shutdown.
And as you start up there is 16 a definite time period in there that it would be required for 17 the dryout of that system -- what we call the dryout.
It's 18 the reduction from about 500 parts per million down t, a few 19 parts per million.
And that process does require some nuclear i
5 20 heat, and that's the reason for the interest in the 8 percent 21 power.
That would occur before any approval for actual power 22 operation.
23 CHAIRMAN ZECH:
You're over time a half and hour, so 24 please wind up.
25 MR. WILLIAMS:
I would -- I know that the Staff is l
l
-f 41 1
going to discuss those issues that we have down here.
We are 2
working actively with the Staff on all of the issues, the 3
technical issues which are shown on page 10.
4 (Slide.]
5 MR. WILLIAMS:
And I believe we're making effective 6
progress in the addressing of each of those issues.
I would 7
conclude my remarks at that point.
8 CHAIRMAN ZECH:
All right.
Any questions before we 9
proceed?
10 COMMISSIONER BERNTHAL:
I want to ask one quick 11 question -- and let's make it quick.
You have initiated a 12 study to determine whether the Chernobyl event has any lessons 13 in or implications that you can make use of.
I want to stress 14
-- and we should all understand -- yours is a very, very 15 different design, but happens to make use of graphite.
16 When do you expect that to be done?
Is there 17 anything at this point that you can say about it?
18 MR. WALKER:
I think it's on here.
19 MR. WILLIAMS:
We are working with --
20 COMMISSIONER BERNTHAL:
It was on your time line.
21 MR. WILLIAMS:
Yes, we are working with General 22 Atomic in that study, working with the General Atomic staff.
23 COMMISSIONER BERNTHAL:
Anything out of that yet?
24 MR. WILLIAMS:
My most recent review with them was 25 principally a review of those features that we should be -- of
f 42 1
the Chernobyl event that we should be focusing on, trying to 2
get the dimensions of the study that we have.
3 As you recall, the last study was focused 4
principally on the graphite issue, and we have tried to look 5
at extending that to other kinds of issues that might be 6
there.
Particularly going to operators, operator training, 7
some of those kinds of issues which are clearly things of 8
importance to the Chernobyl issue.
9 COMMISSIONER ASSELSTINE:
A couple of questions.
10 I'll try and keep it pretty brief.
j 11 The SALP report first.
Do you think that the July 12 SALP report is a fair reflection of your performance?
13 MR. WILLIAMS:
Yes.
14 COMMISSIONER ASSELSTINE:
You don't quarrel or 15 disagree with it?
16 MR. WILLIAMS:
No, we have no quarrel with it.
17 COMMISSIONER ASSELSTINE:
Okay.
I understand your 18 j
comments about what you're doing to improve the management of 19 the operation and also the management theme that seems to l
l 20 pervade many of the areas of difficulty that have been i
21 identified in the SALP report.
I 22 But I wonder if you could talk just briefly on, say, 23 the six key areas where you received the lowest SALP rating 24 and also operations, in terms of how you're going about 25 through your improvement program and better management of the i
a 43 1
1 facility, addressing what seem to be, at least to me, to be 2
some fairly pervasive and deep-rooted problems.
Problems with 3
your procedures, problems with attitudes of your people in f
4 terms of not following procedures, problems in terms of 5
training.
That seems to be a consistent problem in a number i
6 of these areas.
7 How are you going about attacking those things?
And 8
how do you feel now about the amount of progress that you've 9
been able to make since the close of the SALP period, which I 10 guess is probably about six months now, isn't it?
11 MR. WILLIAMS:
I believe the SALP period closed in I
12 May.
13 COMMISSIONER ASSELSTINE:
May, okay.
At least four 14 or five months.
j 15 MR.. WILLIAMS:
And we discussed the report in i
16 August and sent a submittal in, essentially the first of j
17 September.
L 18 COMMISSIONER ASSELSTINE:
Okay.
i f
19 MR. WILLIAMS:
Looking at, for example, the i
20 maintenance area, I think which touches on each of the 21 factors that you were talking about.
4 22 COMMISSIONER ASSELSTINE:
That's a good one.
4 23 MR. WILLIAMS:
I believe also, you will recall that
{
24 the SALP report did recognize that we did have a positive 25 trend on that.
Many of the issues with maintenance reflected I
4
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the earliest part of the time. period.
There were, in fact,
2 efforts in place to enhance the maintenance procedures, the 3
training, and the planning, which I think is a critical area 4
for all of that.
4 i
j 5
The procedures and the training are good, but the 6
planning seems -- and I would reaffirm that the planning is 7
probably the most important aspect of that.
And we are 8
working on all three of those areas very diligently in I
9 there.
We feel we are making progress in that particular 1
j 10 area.
i 11 Emergency preparedness, I think is an area which a j
12 great deal of effort, I know on the part of a few people in j
13 the organization, there was a great deal of effort to have a
{
14 good exercise.
And I think as I evaluated the organization's 15 efforts there, I think there were many elements of it that 16 were good, but there was a pervasive, not enough attention 17 paid to many of the kinds of things that we had to address.
18 Not enough attention paid, for example, to some of the changes i
19 in terms of how the commission will relate to the licensee i
20 with respect to an event like that.
i i
21 And in fact, probably an emergency preparedness I
22 structure organizational 1y where the emergency preparedness 23 coordinator was essentially buried in the organization and not j
24 having enough clout and not having enough management presence 25 and support to really carry out the job.
And we have made 4
i
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45 1
changes in that area.
We have made it clear that wa're strong 2
boosters for what that individual is doing.
That individual 3
is being relocated within the organizational structure and j
4 given my full support in terms of the kind of clout that is 5
r.aeded to provide an integrated effort to effectively manage j
6 that kind of an activity.
i 7
And it's not so much the increased amount of effort, 8
it's the effectiveness of the effort that was made there.
9 There were many, just little deficiencies that added up to 10 give us, I think, the lower rating there.
11 security, we're making, we feel, making significant 12 progress.
Particularly with the physical modifications to the 13 plant.
Most of these issues in security, I would say, i
14 reflected our kind of slow response to the recognition of a 15 degradation in some of the physical aspects of the security 16 system.
2 17 We are on top of that.
We have added a security
{
18 maintenance engineer.
We are tracking the performance of 19 those systems now so that we have an ongoing ability to stay 20 on top of the performance of these systems.
And if we see the 21 degradation, we get in and work on it, rather than let it just 22 accumulate over a period of time.
23 Outages, I would say, is particularly an area that i
24 reflects again the fact that we've had four organizations, 25 that we have not had an integrated planning kind of activity, i
1 1
_ _.__ _ _ __ _...,..._. ~ _,. -.. _ _. - - - _... _ _ -
46 4
1 and we are addressing that principally through the four 2
organizations working together.
The issues that I mentioned 3
earlier in our addressing the design control, which I think is 4
one of the main features of outages that reflects how do we 5
get the outage planning and work through the design process 6
and into the maintenance and whatever outside contractor 7
support efforts that we have.
8 So we are working, I think, directly on that, 9
focusing particularly on the planning aspect of that kind of i
10 work.
Because the planning and how we provide management 11 leadership to the outage -- we have not had -- what many of 12 the plants use is an outage manager, which represents a matrix 13 concept for an organization that is very functionally 14 oriented.
And we are addressing that, and that will be a new 15 area there.
16 I think licensing activities, I know that I have 17 personally spent a lot of time working with the licensing 18 people, working with the Staff, making sure that we are 19 working as a team as the four organizations are concerned in 20 terms of how we are presenting ourselves to the commission, 1
l 21 the quality of the material that we're presenting.
I'm 22 personally reviewing all of these materials that go out.
I
(
23 don't particular accept work that's not up to my own i
24 standards, and it goes.back for rework if it's not up to l
25 standard.
i i
47 4
1 And I spend a lot of time with them on those issues 2
before we interact with the Commission.
And I've been 3
involved directly in several of the meetings we've had with I
4 the Commission because I feel a part of that has been just our 5
effectively managing our relationship.
I understand we don't 6
manage the commission but we manage a relationship with the 7
Commission, and we have to effectively manage that.
So that's 8
the approach that we're taking on there.
9 COMMISSIONER ASSELSTINE:
Last question.
On the 10 safe shutdown cooling paths.
The impression I had from your 11 description was that this is something that had evolved, this 12 difficulty had evolved over time as a result of modifications 13 to the plant.
Is that right?
14 MR. WILLIAMS:
It evolved in our going back and 15 re-addressing safe shutdown cooling paths in connection with 16 the Appendix R requirements and environmental qualification.
i 17 In going back and looking at the FSAR calculations 18 and having those reanalyzed and verifying certain shutdown 19 paths, as we reactivated those codes and programs that were 20 supposed to provide the set of answers and curves that were 4
i 21 reproducable within the FSAR, we found in working with General 22 Atomic that we were not, in fact, reproducing those things.
23 So that's how the issue surfaced for us, and then we 24 have been pursuing that both with General Atomic and another 25 contractor working together to explore all the dimensions of i
?
48 1
that issue.
But it came out of a reexamination in connection 2
with both Appendix R and environmental qualification.
3 COMMISSIONER ASSELSTINE:
Why don't I stop at that 4
point.
5 CHAIRMAN ZECH:
Okay.
Commissioner Bernthal?
6 COMMISSIONER BERNTHAL:
Just a comment.
I noticed 7
your attempts to develop some in-house performance indicators, 8
both to assess technical performance, I guess, and management 9
performance.
The chairman, as you know -- our chairman -- has 10 been very interested in that.
11 I learned recently though that the Clinton plant out 12 in Illinois, Admiral Hall out there has initiated a program of 13 that type.
And in fact, their program is fairly well along, I 14 believe.
15 (Commissioner Asselstine left the room.]
16 COMMISSIONER BERNTHAL:
One of the advantages of an 17 in-house program as opposed to one that an agency like ours 18 might try to do is that you're only judging against your own i
19 standards in-house.
And whatever our minimum requirements i
might be for public health and safety, I would think that your 20 21 in-house requirements should be a cut above that, in fact.
r 22 And my impression is that that's what they're 23 striving for out there.
You might want to talk to them a 24 little bit about it.
25 MR. WILLIAMS:
We have looked at -- we've at least
49 1
looked at two or three other plants, and we're trying to build 2
on those.
And if there's another cne that we can use to build 3
on we certainly appreciate the thought there.
4 COMMISSIONER BERNTHAL:
The advantage you have is 5
you don't have to worry about matching yourself to somebody 6
else.
You can just decide what's right for you and do it.
7 That's all I have to say.
i 8
CHAIRMAN ZECH:
Commissioner Carr?
9 COMMISSIONER CARR:
No.
10 CHAIRMAN ZECH:
Just a brief comment before we call 11 on the other presentors.
I appreciate the things you've told 12 us this morning.
I think Mr. Walker has talked about the 13 financial circumstances and given us an insight on the plans 14 for the future.
15 Mr. Williams, I know you haven't been there very 16 long and I know you have a strong background.
On the other 17 hand -- and I think the things you've told us this morning are i
18 useful, but they're also very general in my view and rather i
19 fundamental.
And that's how you have to start, I appreciate 20 that.
21 On the other hand, I think that the history of the 22 performance of the plant at Fort St. Vrain, at least as far as 23 I'm concerned, requires more confidence on our part that some 24 of the things that you're involved in are actually going to 25 take place.
e.
50 1
In other words, I'm looking for results.
And that 2
requires leadership, a commitment, more details, attention to i
3 detail.
And you've given us some general thoughts, but 4
management performance is important, but you've got to get 5
right down to the fundamental dtails of operation and 6
performance.
7 (Commissioner Asselstine returned to the room.)
8 CHAIRMAN ZECH:
The SALP is certainly not anything 9
that you ought to be proud of.
In my view, it's one of the 10 worst I' vet seen since I've been here.
I'll let our own people 11 discuss the marks, but it looks to me like you have a real 12 significant challenge.
And if you're thinking about asking 13 for a start-up period in late November, early December, and 14 perhaps restart approval sometime in early February, it seems 15 to me like that's a very ambitious program from what I can 16 tell the situation of your history at Fort St. Vrain.
17 So I think you have a very, very significant 18 challenge and we'll be watching your performance and the 19 results -- at least I will -- very closely.
20 With that, let me thank you very much and call on 21 our own speaker.
First of all, I guess, Mrs Martin from 22 Region IV.
Is that how we stand?
23 Thank you, gentlemen.
24 MR. WALKER:
Thank you.
1 25 CHAIRMAN ZECH:
Are you going first, Mr. Martin, is 1
51 1
that it?
2 MR. MARTIN:
Mr. Vollmer, I believe.
3 CHAIRMAN ZECH:
Mr. Vollmer is leading off?
4 MR. VOLLMER:
Yes, we'll be very brief, 5
Mr. Chairman, providing the status of Staff actions dealing 6
with Fort St. Vrain.
Bob Martin will discuss the regional 4
7 actions, including the SALP assessment, special regional 8
inspections, and future regional actions dealing with the 9
restart issue and licensee performance.
10 Frank Miraglia will discuss the management and 11 licensing issues and go over some of the principal technical i
12 issues that we have in mind for -- will be involved in both 13 restart and for longer term operation.
Also at the table is 14 Mr. Ken Heitner who is the licensing project manager for Fort 15 St. Vrain.
16 I think that the Staff is generally optimistic that 17 the steps being taken by the licensee in the management, 18 technical and plant improvement areas are appropriate to 19 support restart.
But the Staff will closely follow the l
20 results of these actions as they're being implemented by the 21 licensee.
I think it's important to see what the results are.
22 I'll turn it over to Bob for the regional 23 assessment.
J 24 CHAIRMAN ZECH:
All right, Mr. Martin.
25 MR. MARTIN:
Let me build somewhat on what
52 1
Mr. Vollmer just mentioned.
As a summary comment, especially 2
in light of the concern that you just evidenced at your 3
closing remarks, Mr. Chairman, at least from a regional 4
perspective -- and I believe this is also true in the NRR, the 5
licensing perspective as well -- we have started to see the 6
impact of some of the managerial and work philosophy changes.
7 The quality of the work that we've been observing, 8
responses to our concerns, reactiveness, responsiveness to 9
technical issues have been improving very substantially in 10 recent months showing, I believe, an impact from some of the 11 managerial changes that have been made, which of course were, 12 as summarized by the company in terms of the SALP ratings, 13 very much a key part of what our concerns have been at the 14 plant for a while.
So I won't resummarize again the SALP 15 assessment since we have just really gone through that.
16 We have conducted EQ special inspections.
And the 17 one in conjunction with NRR led us to believe that that 18 program was being, in terms of the work being done -- that is, 19 the field work being done -- was being done well, was being 20 managed well.
We did not come up with any major issues in 21 terms of the manner in which they were entering the program.
22 Now again, final results have to be looked at.
This 23 was a preliminary look because of our concerns about the area l
24 of quality in the past, whether or not they were entering into 25 a major program with major defects in the quality programs to
53 1
control the work.
That was not present.
That was not 2
evident, but quite the contrary, a fairly strong program was 3
apparent to be in place.
l 4
So we feel much more comfortable about the work 5
which is currently being conducted.
We have yet to do the 6
final EQ inspection, which of course will be done primarily 7
8 COMMISSIONER BERNTHAL:
How many items in their EQ 9
list remain to be fixed, resolved, whatever, aside from what 10 you may have inspected?
I guess I should have asked them.
11 MR. MARTIN:
You mean physical work items, sir?
12 COMMISSIONER BERNTHAL:
Yes, how many physical work 13 items are left?
14 MR. MARTIN:
I would tend to think the company might 15 be the only one that could answer it at this point.
16 COMMISSIONER BERNTHAL:
I suspect so.
I'm sorry I 17 didn't ask.
18 CHAIRMAN ZECH:
Please identify yourself.
19 MR. HOLMES:
Mike Holmes, nuclear licensing 20 manager.
Our particular program is centered around the 21 installation of a new steamline rupture detection isolation 22 system, which is largely in place right now.
It is not hooked 23 up because it requires a technical specification change which 24 the Staff is currently reviewing and processing.
Technically, 25 you can say that none of our items are in compliance until
54 1
that system is in place and working to support the 2
qualification program that we have there.
3 COMMISSIONER BERNTHAL:
That is the single physical 4
work item that you have --
[
5 MR. HOLMES:
No, there are a variety of additional 6
plant modifications, equipment substitutions being made to put 7
in qualified equipment.
That is all going on during this 8
outage.
I don't have a current count as to how many of those 9
are in place, how many of them are still to be installed.
The 10 majority of the work would be done as of the first of 11 December.
12 COMMISSIONER CARR:
That's the controlling path 13 though?
14 MR. HOLMES:
The installation work during the 15 shutdown.
And of course, the qualification of the binder, the 16 documentation to support the qualification of all this 17 equipment is proceeding in parallel.
18 COMMISSIONER BERNTHAL:
Thanks.
19 MR. MARTIN:
In addition, we've conducted other 20 specialized inspections in the general area of quality 21 assurance effectiveness.
I think has been mentioned, there 22 have been some managerial changes in their QA department.
23 Those, again those are managerial changes.
We will have to 24 assess the impact.
The new QA manager will be reporting 25 on-board full-time like Monday of next week.
So it is very
55 1
much something that we're going to have to monitor to see the 2
effectiveness of it.
3 In the training area, we did a training inspection.
4 We also recently went through licensing examinations and their 5
operators did extremely well in terms of our regional 6
experience with conducting licensing examinations.
These 7
were requalification examinations.
These were not initial 8
examinations, but they performed quite well against the 9
requalification examination program that we followed.
10 And we have assigned a second resident inspector, 11 was assigned in August.
So this plant receives, if you will, 12 for the amount of power output it has generated historically 13 compared to other plants, has received a great deal of 14 inspection attention from the regional office and in combined 15 teams from NRR and I&E.
16 And if we go to the next slide --
17 (Slide.]
18 MR. MARTIN:
-- and talk about issues which are 19 going to be coming up in the future, it is going to continue 20 to receive that kind of attention up through the start-up 21 period, whenever that approval is finally given, and into the 22 early phases of start-up.
23 So it's experiencing a very substantial inspection 24 load.
So I believe we will be able to report back to you with 25 some measure of -- a high degree of confidence whether or
56 1
not some of the programmatic changes the company has proposed i
2 to you today and described for you today are, in fact, taking 3
effect and are having the desired results that we were looking 4
for.
5 I won't bother going through all of these in any 6
sort of detail, but there is a planned program of a fairly 7
heavy inspection emphasis on that plant.
Let me move away 8
from inspection -- evaluative emphasis, because a. number of 9
these are going to be joint team activities between the three 10 responsible program officers.
11 We'll, I believe the next time you come to a 12 decision or have to reach the decision point, we'll be able to 13 give you a much more balanced view as the Staff view as to how 14 well they have done and what kind of shape they're in as of 1
15 that point.
That really concludes the scope of my remarks, 16 Mr. Chairman.
17 CHAIRMAN ZECH:
All right, thank you.
18 MR. MIRAGLIA:
With respect to the management of 19 licensing issues, I think rather than go through that in much 20 detail, I essentially would concur with Mr. Williams' 21 characterization of the four organizational entities not 22 interacting.
23 CHAIRMAN ZECH:
This is Mr. Miraglia for those of 24 you who haven't met him yet.
Go ahead.
l 25 MR. MIRAGLIA:
Thank you, Mr. Chairman.
I think the i
l
57 1
coordination process and the lack of. coordination, substantive 2
coordination among those groups affected the quality of the 3
submittals and the feedback between operations, licensing and 4
engineering.
I think that was a fundamental concern.
5 I think we saw slight improvements in that even 6
earlier.
And I think in the SALP period, which ended in May, 7
we indicated it was on an improvement trend.
And I think more 8
recently that improvement is continuing.
So we see at least 9
positive steps in those kind of direction, and some positive 10
- results, 11 The licensee had a large number of technical issues 12 before it, and certainly as matters affecting restart the EQ 13 issue is the most significant one.
We've looked at the PSC's 14 program and we think that the program is an acceptable one.
15 Previous deficiencies that the Staff had identified 16 in the program have been addressed.
There are a number of 17 technical details that we're still evaluating with respect to 18 the steamline detection rupture isolation system and things of 19 these nature.
We feel that these are technically resolvable 20 problems and the dialogue has been in a positive kind of 21 direction.
22 Certainly the field work has to be completed and the 23 inspections and the verification that the program has been 1
24 implemented in the right kind of way is certainly an item that 25 has to be completed.
But we think there's progress in that
1
\\
~
58 1
area.
2 Briefly with respect to the safe shutdown of the 3
system, that is an issue that we are dialoguing with the 4
utility on.
And again, we have had requests for information, 5
and the schedule is to be submitted, and we expect an analysis i
6 and future dialogue on that.
7 Again, I think we understand the issue and the a
possible outcomes of that and paths for coming to resolution 9
to make some sort of start-up recommendation.
What that power 10 level, the ultimate power level is, we're going to have to 11 look at the analysis and agree with the utility that that's 12 the appropriate kind of level.
Again, there's been 13 significant effort in that area.
14 CHAIRMAN ZECH:
Are these all issues that have to be 15 resolved as far as you're concerned before you're confident 16 you can allow restart in November?
17 MR. MIRAGLIA:
No, I think the EQ and the safe 18 shutdown issue certainly are.
I think the others are probably 19 more of a longer term.
20 The last issue on electrical independence has a 21 short term aspect to it and I think we're getting closer on 22 that one.
But the other issues are longer term licensing 23 issues that have been before the utility for a long time.
24 COMMISSIONER BERNTHAL:
Is there anything that's 25 been resolved?
Can you tell me one thing that's done that
I 59 l
1 you're pleased with in the last month, or six or eight weeks?
2 MR. MIRAGLIA:
I think if one goes back in history, 3
I think the control rod refurbishment would be an issue that 4
can point to progress.
5 COMMISSIONER BERNTHAL:
How far back in history is 6
that, a couple years?
7 MR. MIRAGLIA:
June '84 and to restart.
8 COMMISSIONER BERNTHAL:
What have we uone lately 9
there?
I mean, where are we?
Has anything been finished 10 yet?
I see about six -- five issues here.
11 MR. HEITNER:
The technical specification upgrade 12 program is viewed as a long-term effort.
It's probably taken 13 even longer than we originally thought it was.
But the 14 purpose was to improve the technical specifications for this 15 plant, which.you know, date back to the early '70s and bring 16 them more into the middle '80s-type timeframe.
17 COMMISSIONER BERNTHAL:
Right.
18 MR. HEITNER:
We're in the process of issuing a 19 draft SE to the licensee, as we typically do with fire 20 protection because it's a complex issue in order to get his 21 comnents on it.
And then once we have his comments and we've 22 made sure that the SE is technically correct, we will issue 23 the exemptions.
And then the only thing that's necessary is 24 for us to ascertain that he actually is in compliance with 25 Appendix R, that all of his supporting programs are in place.
a 60 s
1 COMMISSIONER BERNTHAL:
We're going to do all this 2
in how many weeks?
3 MR. HEITNER:
That's not a restart issue.
That's 4
something that we still have to work on.
That's again, a 5
major long-term project.
6 MR. MIRAGLIA:
That's a longer term program.
7 They've been underway for a while.
Again, Appendix R has been 8
discussed by Ken in his brief remarks.
The tech spec upgrade 9
program is something that came out of early assessment, and 10 identified a need to do it, and the utility has committed to 11 it.
And it has been a major effort for both the utility and 12 the Staff, and there's program being made in that area.
13 And again, the electrical independence is 14 questioned.
There have been some design vulnerabilities 15 identified with respect to that and we have been reviewing 16 those.
And there is an interim solution that's been proposed 17 that we've been evaluating and then there's some longer term 18 alternatives and design changes being examined in that kind of 19 area.
20 That's sort of a capsule of where we are with 21 respect to the Fort St. Vrain facility.
22 CHAIRMAN ZECH:
All right, does that conclude --
23 MR. VOLLMER:
That concludes it, Mr. Chairman, 24 except for questions.
25 CHAIRMAN ZECH:
All right.
Questions, Commissioner 4
61 1
Asselstine?
2 COMMISSIONER ASSELSTINE:
Just a couple.
First, I 3
missed part of the Chairman's closing comments but what I 4
heard I certainly agreed with.
And I think my conclusion is 5
much like his.
When I read this SALp report, I can't remember 6
reading one worse than this one.
And I guess as I read 7
through the thing, I just get a sense of a few broader 8
conclusions about the operations down there.
9 One, I get the sense that there's just a general 10 sloppiness, or has been a general sloppiness throughout the 11 operation in a whole series of areas: operations, maintenance, 12 emergency planning, security.
Just a number of areas where 13 there's just a lot of sloppiness to the operation.
14 I also get the sense that there's some attitude 15 problems in terms of people taking requirements seriously, 16 following procedures, and taking a conservative approach to 17 safety.
I get that sense particularly from reading the
{
18 operations section.
l l
19 And I also get the sense that there's been a past a 20 lack of clear direction from the top on what's expected from 21 people and a lack of accountability.
That, is people being 22 told, you're going to have to perform and meet our 23 expectations and you're going to be held accountable for 24 that.
25 I also get the sense that there's a lack of support
g 62 1
in some key areas, fixing the procedures, fixing the security 2
problems, fixing the outage planning difficulties.
And I 3
guess I also get the sense that there's been some weak 4
management in the past at various levels, some areas that 5
haven't gotten the kind of support from the top that are 6
needed.
7 And what I'm interested in getting a sense for is, 8
first, if you think those characterizations are pretty well on 9
the mark.
And if you do, how you're going to go about 10 ensuring that between now and December that there's real 11 concrete evidence that those kinds of problems have either 12 been corrected or are well on the way to being corrected.
13 MR. MARTIN:
I think that probably falls to my 14 area.
Let me answer the first question.
Your 15 characterization, while I might not use exactly the same 16 adjectives, I don't think we fundamentally disagree with the 17 way in which you characterize it, nor does the company.
That 18 period of time also covered up through about May of this year.
19 There have been since that time two very major 20 changes have taken place.
For a period of time, a prior 21 senior manager was no longer with the facility, and the CEO i
22 actually took personal charge and personal responsibility for 23 the facility for a period of time, which started to solve a 24 number of the problems which are referred to and alluded to 25 there.
63 1
Certain other changes that have been made since that i
2 time -- and those things which are perhaps personality or 3
leadership driven -- certain other changes have been made 4
quite recently that also address the other elements that gave 5
us, if you will, in our view, the largest contributors to the 6
very kinds of leadership concerns that you spoke of.
So we 7
believe those tools are in place.
8 But as I keep saying, I believe all the fabric has 9
been put in place and we are starting to see positive results 10 from the new fabric working in that relationship.
But your 11 characterization is true and correct for our summary views as 12 of May.
13 Recent activities of our looking at it since then 1
14 have been strengthening our views in a number of these areas.
15 Licensing, I think has been mentioned as one.
Those kinds of 16 relationships and the relationship of security, they have made 17 major strides in those areas.
18 A number of difficulties we had before was coming to 19 a mutual understanding on the importance of those issues to be 20 resolved.
That is no longer a problem.
Just getting over 21 that hurdle gives us the opportunity to find speedier solution 22 or resolution of a number of these issues.
23 Those are the kinds of things from which I am i
24 drawing a certain confidence and trying to convey that 25 confidence to you.
But I can't really convey great confidence y
64 1
to you because it has been a fairly _short time duration.
That
~
2 is what we hope to observe.
3 I believe we're on a steep part of a very positive 4
curve at this point, which I admit is capable of turning in 5
the other direction again.
But at least right now, we seem to 6
be on a very steep part of a good curve.
7 COMMISSIONER ASSELSTINE:
When we looked at some 8
other problem plants -- I know Pilgrim is one of them -- where 9
we were thinking about what to do prior to restart of the 10 plant, one of the things the Commission and the Staff had 11 talked about was a team approach to getting people at the 12 site, our people, for a long enough period of time to get a j
13 real sense for how the new management team was performing and 14 whether the changes really were taking place.
Not just 15 promises, but real results.
16 Do you have in mind something along the same lines?
17 And is there enough time between now and when the company is 18 talking about asking for authority to restart to get a real 19 sense for whether the results are there, whether it's really 20 working?
?
21 MR. MARTIN:
You may not have noticed but on the i
22 chart inherent in the upcoming activities are included certain 23 readiness type evaluations, inspections, visits.
I think
{
24 we'll be covering that plant with an awful lot of people 25 between now and the time -- in terms of whether I would put a 4
..-_,,...-n
1 65 1
team together that describes quite the framework you used, 2
that is not planned.
3 But what we have is a matrix of activities planned 4
to go up, which involves a hell of a lot -- excuse me -- a lot 5
of inspection on-site with a lot of people to come back with 6
that balanced view of a large number of people so that we can 7
tell you, we think you should be comfortable in letting them 8
restart, or we won't be back to you to support restart.
9 COMMISSIONER ASSELSTINE:
Okay.
Last question, safe 10 shutdown cooling.
I guess the sense I had as a result of the 11 company's d scussion was that this had no longer term problem 12 and it was the reanalyses that were done as a result of EQ and 13 Appendix R that had basically turned it up.
Is that basically 14 right?
15 MR. MIRAGLIA:
That's correct.
16 COMMISSIONER ASSELSTINE:
When did we find out about 17 it?
18 MR. MIRAGLIA:
I want to say it was sometime this 19 summer.
i 20 MR. HEITNER:
Yes, they reported the problem with 21 the reheater analysis, which is one of the paths, to us in 22 July, and followed it up with and LER in August.
And then in 23 September they found that when they were redoing the main 24 steam section that they had a problem with that and they 25 reported that to us again.
4 66
+
1 1
And at that point we took action and asked them for 2
all the details.
And we will probably review that before we
~
3 will allow them to restart.
4 COMMISSIONER ASSELSTINE:
Given what we know now as 5
a result of those analyses, did the plant operate for periods 6
outside of its safe shutdown cooling capability?
7 MR. MIRAGLIA:
One of the first questions we asked, 8
Commissioner Asselstine, with respect to the 35 percent wanted 9
concession, and they'd done some analysis to show that it was 10 not an issue there.
11 As Mr. Williams was saying, they're going back and 12 looking over the operational life of the facility, were they 13 ever at a point where that safe shutdown concern would have 14 been an issue from a historical perspective.
The analyses are l
l 15 based at a core at the end of life at 100 percent power for so 16 many days.
And they may have never been within that 17 envelope.
18 That's part of the analysis, the historical 19 perspective the Mr. Williams alluded to.
They're going back 20 and examining, what's the operational experience at the 21 facility, as opposed to the issue does it work now, and was 22 safe shutdown cooling an issue, were they inside that 23 envelope.
And they're looking at that.
24 COMMISSIONER ASSELSTINE:
Okay.
And I take it, the 25 result of that may well largely be determined by the fact that
67 1
the plant didn't operate at 100 percent power for all that
~
2 much time.
3 MR. MIRAGLIA:
That's correct, yes.
We won't know I
4 until we see the analysis, but that is a potential outcome, 5
yes.
6 COMMISSIONER ASSELSTINE:
Thanks.
That's all.
7 CHAIRMAN ZECH:
Commissioner Bernthal?
8 COMMISSIONER BERNTHAL:
No.
9 CHAIRMAN ZECH:
Commissioner Carr?
10 COMMISSIONER CARR:
No.
11 CHAIRMAN ZECH:
Let me just say very briefly that 12 I've already expressed my concern to the licensee, and I 13 generally agree with Commissioner Asselstine's assessment 14 also.
I simply am not very confident that this schedule has 15 any possibility of being met.
16 Now I have great respect for the Staff and for your 17 professionalism and your competence and your evaluations.
On 18 the other hand, you're much more comfortable with this plant 19 than I am, I can tell you that right now.
And you're going to 20 have to convince me very soon that this plant has any chance l
21 of going to start-up in November.
22 I know you're closer to the details than we are at 23 the Commission, but I'm giving you my personal opinion that 24 you've got two very significant items, equipment qualification 25 and safe shutdown cooling, in order to resolve, as well as
68 1
some electrical independence, I believe.
The other Appendix 2
R, fire protection, technical specifications are ongoing you 3
tell me.
4 To me, that's a very steep curve, Mr. Martin.
And I 5
agree that certainly it sounds like they're doing the right 6
thing..But this is not a new company.
This is a company 7
that's been going for a long time.
The history, as I 8
understand it, is not very good.
And although certainly I 9
understand the commitment of the current leadership and the 10 programs they have in place, to me those are-plans.
I want to 11 see results, in a hurry.
12 You're much more confident than I am that this plant 13 is ready, anywhere near restart.
I'm not at all in agreement 14 with some of your evaluations, and you should know that.
I 15 think there's a long way to go.
And I ask the Staff to give 16 it very close watch and a very hard look.
And you've got to 17 convince me that you've done that and the plant's ready before 18 at least this chairman is ready to support any recommendation 19 for start-up.
I just think there's a long way to go.
20 I would be pleased to see that sharp curve met.
My 21 background tells me it's a very real challenge.
22 Any other comments of my fellow commissioners?
23 COMMISSIONER ASSELSTINE:
Just to say I agree 24 entirely with your assessment, Lando.
25 CHAIRMAN ZECH:
Let me just say, this has been, I
4 69 1
think, a valuable presentation.
I thank all of you who have 2
been here to talk to us this morning.
I think we really do 3
have a challenge.
4 Mr. Vollmer, do you want --
5 MR. VOLLMER:
I just want to say, Mr. Chairman, that 6
we certainly get the sense of the Commission.
As I indicated 7
in the opening, we were optimistic that the right path was 8
being followed.
We, too, are concerned with results and we 9
certainly will work hard to make sure that we follow closely 10 all the things that we need to show you, convince you that the 11 plant is ready for restart.
12 CHAIRMAN ZECH:
And I appreciate the fact that 13 you've got a SALP report with six category threes.
That's the 14 lowest there is.
As I say again, I've never -- I don't recall 15 seeing one like that, so I think you also recognize that this 16 is not a well-performing plant.
17 MR. VOLLMER:
Yes, we do.
18 CHAIRMAN ZECH:
There's a long way to go.
And so, I 19 don't -- I recognize that you, too, agree.
But all I want to 20 tel) us you is I'm just probably a little less comfortable 21 that it's improving than you are.
So we've got to keep 22 watching this, as far as I'm concerned, very carefully.
I 23 know you will.
24 Any other comments?
25 (No response.]
70 1
CHAIRMAN ZECH:
All right, with that we'll adjourn 2
the meeting.. Thank yoti.
3 (Whereupon, at 11:40 a.m., the commission meeting 4
was concluded.]
5 6
7 8
9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
1 2
REPORTER'S CERTIFICATE
~
3 4
This is to certify that the attached events of a 5
meeting of the U.S. Nuclear Regulatory Commission entitled:
6 7
TITLE OF MEETING: Commission Meeting Briefing on Fort St. Vrain (Public Meeting) 8 PLACE OF MEETING:
Washington, D.C.
9 DATE OF MEETING:
Friday, October 17, 1986 10 11 were held as herein appears, and that this is the original 12 transcript thereof for the file of the Commission taken
{
13 stenographically by me, thereafter reduced to typewriting by 14 me or under the direction of the court reporting company, and 15 that the transcript is a true and accurate record of the 16 foregoing events.
17 18 Pamela Briggle 19 20 21 22 Ann Riley & Associates, Ltd.
23 24 25
IC/16/86 SCHEDULING NOTES TITLE:
BRIEFING ON STATUS OF FORT ST. VRAIN SCHEDULED:
10:00 A.M., FPIDAY, OCTOBER 17, 1986 (OPEN)
DURATION:
APPROX l-1/2 HRS PARTICIPANTS:
LICENSEE 30 MINS
- RICHARD WALKER CHAIPMAN OF THE BOARD PUBLIC SERVICE COMPANY OF COLORADO
- ROBERT 0. WILLIAMS, VICE PRESIDENT NUCLEAR REGION IV 15 MINS
- ROBERT MARTIN, REGIONAL ADMINISTRATOR NRR 15 MINS
- FRANK MIRAGLIA
k PUBLIC SERVICE COMPANY OF' COLORADO FORT ST. VRAIN COMMISSIONERS MEETING 1717 H STREET, N.W.
OCTOBER 17, 1986 10:00 A.M.
AGENDA 1.
PSC MANAGEMENT ACTIONS R. F. WALKER INTRODUCTION FSV PLANT WRITE DONN AND SETTLEMENT 4
INTRODUCTION OF R. O. WILLIAMS 2.
FSV MANAGEMENT ACTIONS R. O. WILLIAMS MANAGEMENT PERFORMANCE RESTART DLANNING TECHNICAL ISSUES 4.
REMARKS BY REGION IV 5.
REMARKS BY NRR
~~
9-4 U. S. NUCLEAR REGULATORY COMISSION BRIEFING ON STATUS OF FORT ST. VRAIN A
OCTOBER 17, 1986 i
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PUBLIC SERVICE COMPANY OF COLORADO 1
SPEAKERS:
RICHARD WALKER CHAIRMAN OF THE BOARD 1
ROBERT 0. WILLIAMS i
VICE PRESIDENT, NUCLEAR h
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i-i U.S. NUCLEAR REGULATORY COMMISSION STAFF SPEAKERS:
ROBERT MARTIN REGION IV FRANK J. MIRAGLIA 0FFICE OF NUCLEAR REACTOR REGULATION l
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ECEE REGIONAL ACTIONS SALP ASSESSENTS (IN COORDINATION WITH IE/NRR)
EQ SPECIAL INSKCTIONS (NRR PARTICIPATION)
SPECIAL EGIONAL INSRCTIONS - EQ, QA, TRAINING 2ND RESIDEE ASSIGNED 1
- m.. - _., _ _
FUTURE ACTIONS EQ CCNPLIANCE INS CTION (IE LEAD)
READINESS FOR RESTART INSPECTIONS MONITOR COPPANY ACTIONS ON READINESS TO RESTART ACCELERATED SALP INCREASED INSRCTION RESOURCES FOR FY '87
b MANAGEMENT OF LICENSING ISSUES 4
INTERNAL C0 ORDINATION
- QUALITY 0F LICENSING PROPOSALS AWARENESS OF OPERATING EVENTS SELF-CORRECTION OF OPERATING PROBLEMS CORRECTIVE ACTIONS DEFINED AND BEING IMPLEMENTED i
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_a TECHNICAL ISSUES EQUIPMENT QUALIFICATION SAFE SHUTDOWN COOLING APPENDIX R FIRE PROTECTION TECHNICAL SPECIFICATION UPGRADE PROGRAM ELECTRICAL INDEPENDENCE 4
=-
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TRANSMITTAL. T0:
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