ML20205N841
| ML20205N841 | |
| Person / Time | |
|---|---|
| Issue date: | 04/21/1986 |
| From: | Stello V NRC OFFICE OF THE EXECUTIVE DIRECTOR FOR OPERATIONS (EDO) |
| To: | |
| Shared Package | |
| ML20205M922 | List: |
| References | |
| FOIA-86-810, TASK-PINC, TASK-SE GL-85-15, SECY-86-122, NUDOCS 8605150252 | |
| Download: ML20205N841 (12) | |
Text
--
var 17maggMMMMMMMMMMs i'
\\
% A a. s, e -
kk
'l LeT pac.L.
- s. y..... j April 21, 1986 POLICY ISSUE
~ srcr-as-122 (NEGATIVE CONSENT)
For:
The Comissioners From:
Victor Stello, Jr.
Executive Director for Operations
Subject:
POLICY FOR ENFORCEMENT OF ENVIRONMENTAL QUALIFICATION REQUIREMENTS
Purpose:
To obtain Connission approval of the staff's proposed criteria for enforcement of the environmental qualification requirements.
Background:
On June 18, 1985, the staff pro'vided the Comission a paper (SECY-85-220) on im qualification (EQ) plementation of the environmental requirements which included the staff's views on enforcement of the EQ rule and a proposed generic letter describing the staff's enforcement policy.
The Comission, with the staff's assistance, modified the staff's proposal and directed that the staff issue Generic Letter (GL) 85-15. GL 85-15 advised licensees that if they elected to operate in noncompliance with the EQ rule after the November 30, 1985 deadline without an approved extension, they could face civil penalties of $5,000 per item per day. GL 85-15 provided that the. fines could be made retroactive to November 30,1985 "for each day a licensee clearly knew, or should have known, that equipment qualification was incomplete."
On February 18, 1986, in a memorandum from Chainnan Palladino to the Acting Executive Director for Operations, the Comission directed that the staff provide the enforcement criteria it clea.-}g -
3roposes to implement whenever it is detennined that a licensee clearly cnew orfshould have known that its equipment was not qualified or for other reasons is found in noncompliance with 10 CFR 50.49.
The Comission directed that the staff answer the following questions in developing the criteria:
1.
Should a licensee shut down if he is found to be in nonccmpliance?
2.
Should a licensee be afforded the option to operate in noncompliance under the daily fine structure?
3.
Must a licensee have NRC] reviewed and approved JCO's in order to continue operation?
_ Contacts:
Jane Axelrad IE x24909
[
i y/
Gary Zech, IE x29663
\\
~
p, The Commissioners o 4.
When should the daily fine provision of the generic letter, either through a " statute of limitation" or other mechanism expire?
5.
What formula will the staff apply to mitigations relating to the $5000/ day fine?
+
EQ deficiencies have been identified at several plants which operated after November 30, 1985.
In addressing these cases, the staff has developed enforcement criteria which answer the Commission's questions. The proposed criteria and an explanation of how the criteria will be applied is provided in Enclosure 1.
The answers to the specific questions posed by the Commission are provided below.
Discussion:
1.
Should a licensee shut down if he is found to be in noncompliance?
In cases in.which licensees discover EQ deficiencies after the deadline, questions arise regarding whether the deficiencies in the equipment render systems covered by technical specifications (TS) inoperable and whether shutdown is required.
The position taken in Generic Letter 85-15, and that taken by the staff, is that whether shutdown is required depends upon whether the system of which the equipment is a part is covered by.,the TS and, if so, whether the system should be considered inoperable under accident conditions because of the identified l
EQ deficiencies.
i l
For equipment in systems covered by TS, this is a very complex question.
In the case of certain valve operators in which deficiencies'in qualification of wiring have been discovered, several utilities did evaluations which determined that the plants could be operated safely while qualification of the operators was being established, that' the lack of qualification did not render the systems to which the valves were attached inoperable, and that shutdown of the plants was not, therefore, required by the TS.
For some of the valve operators, licensees concluded that the operators were not required to be qualified because they were j
not required to mitigate the consequences of an accident or they were in a mild environment. 'One utility argued that the master list of equipment required to be qualified had been developed in a conservative manner without examining each piece of equipment included on it.
Rather, a systems approach was taken and certain pieces of equipment were included that need not have been qualified.
A g.W a:
s y
The Conunissioners,
For operators that were requ red to be qualified, some licensees had determined that the equipment would not become inoperable during an accident because the valves would fulfill their function before being exposed to a harsh environment and failure after exposure to the harsh environment would not cause the valves to change their position, mislead the reactor operators, or adversely affect other safety-related equipment.
On the basis of these evaluations, the licensees concluded that inmediate shutdown of the plants was not required. The alternative to this approach would have been to assume without analysis that because the qualification of the equipment had not been established, it was considered inoperable and to require the. licensees to either repair the equipment during the time allotted in the action statements or shut down the plants. The staff did not require this approach.
In accordance with the above-dsscribed principles, the staff has developed the following general guidance for situations in which the licensee does not have adequate basis to establish qualification of its equipment, e.g. missing documentation or omission of required maintenance:
The ifcensee is expected to make a determination of operability.
The licensee may attempt to make a finding of operability using analysis and partial test data to provide reasonable assurance that the equipment will perform its safety function when called upon to mitigate the accidents for which it is needed.
In this connection, it must also be shown to determine operability that subsequent failure of the equipment under accident conditions will not. result in significant degradation of any safety function or provide misleading information to the operator.
If the licensee is unable to demonstrate operability:
For inoperable equipment included in systems covered by a.
plant technical specifications, the licensee shall follow the appropriate action statement.
This could require the plant to shut down within a limited period of time (or remain shut down).
l b.
For inoperable equipment not covered by the plant technical specifications, the licensee may continue reactor operation:
(1) If the safety function can be accomplished by other designated equipment that is qualified, or
The-Comissioners
-4' (2)
If limited administrative controls can be used to ensure the safety function is perfonned.
The licensee should also evaluate whether the findings are reportable under 50.72, 50.73, Part 21, TS, or any other pertinent reporting requirements, particularly if equipment is detennined to be inoperable.
2.
Should a licens'ee be afforded the option to operate in noncompliance under the daily fine structure?
The staff believes that such licensees should be subject to i
fines retroactive to November 30, 1985 if they " clearly knew or c.b<ti should have known" that their equipment was not qualified by i
that deadline. The daily penalty was established as an incentive to licensees to meet the November 30 deadline by taking actions to avoid noncompliance. Penalties for licensees which failed to
.take appropriate actions should be levied under the Generic Letter as indicated to ensure tha,t incentives such as this are taken seriously by licensees in the future.
3,nl N ica s ea.
However, if a licensee has made a r::: dle determination 3 as im eu.m nt J that it is safe to allow continued operation while the m e
,,en n cualification of the equipment is being established or the sc.b dota b equipment is replaced,0then the licensee should be allowed to
- .eutet. t he.
continue to operate without additional penalty. Once a licensee s ac.*mpuance, has erred by fail!ng to establish qualification by November 30, the staff sees no point in continuing to assess a penalty once l
an operability decision has been made. Continuing to assess daily civil penalties until the violation is corrected would
- . L wmr. e fl. v,n 6.
provide. strong incentives for shutdown even though the licensee N
oms.dar.J A auns.,c.
and the staff determine that continued operation is not unsafe.
N,,,$4,Y,,"Oj If the licensee's determination of safety is later found to be f,,,,, S s,f, o g g,,
deficient, shutdown may be required and the licensee may also dA,..,4, 3 be subject to daily civil penalties.
kn=*a" % nas.
3.
Must a licensee have reviewed and approved JCOs in order to continue operation?
Although NRC review and approval of the safety of continued operation is not necessary when equipment is found to be in most noncompliance with 50.49, license'esvre := :ted te prep:re JC05 te establish that equipment in question would not affect safe continued operation.
The general guidance discussed in l
response to question 1 above should be followed when equipment i
for which qualification cannot be established is identified.
Howaver, the staff expects that licensees will conduct an evaluation of any deficiencies identified and, if appropriate,
'd'Ea9 J[o'Oc=Taswill follow any applicable technical specification action er cJenue perat.oS statement. Such evaluations'must be documented by the licensee and, if applicable, reported to the NRC under the provisions of the existing regulatory requirements (Part 21,50.72,50.73,etc.).
These evaluations will be included in the scope of the NRC inspections at operating plants.
L.
The Commissioners l 1
c 4.
When should the daily fine provision of the generic letter, either through a " statute of limitations" or other mechanism expire?
AsI by the question, the concept of a $5000 per item 4
4 per day fine can be read to make less overall safety sense as time goes on. The last "first-round" inspection by special teams to review licensees' compliance with 10 CFR 50.49 is not expected to be completed until the end of FY 1987 at the earliest.
By'this approach, those licensees inspected later could be subject to much higher penalties than those which are inspected,y.; g
earlier because the period over which the fine would be p,.
retroactive is much larger. T.n ordu b ma.a-r.
s*
- oew k.
- n u
- 4. u.
.. rs.. a,
a m...~.
J.s o o,..o
- c. i o e t.
p. i.b c.a q.ll h On the other hand, having an " expiration date" for the provision o W aad d '*
removes the " incentive" to ensure EQ questions are identified
- * "** ' g a
and resolved. Accordingly, while the staff has no " expiration h.k_a-
"'d date" in mind for the civil penalty of $5000 per item per day, the staff will adjust the fines using the mitigation factors and other pertinent information described in response to question ""h 5 below to ensure that the fines levied will be cormnensurate
' " M *"
with the safety significance of the violations.
oft.k. hJi roe &.
4 5.
What formula will the staff apply to mitigations relating i n.secch to the $5000/ day fine?-
4 l
Generic Letter 85-15 describes three factors which the staff will consider in detennining whether mitigation of the penalty is appropriate:
1.
Did the licensee identify and promptly report the noncompliance with 10 CFR 50.49?
2.
Did the licensee apply best efforts to complete environmental qualification within the deadline?
3.
Has the licensee proposed actions which can be expected to result in full compliance within a reasonable time?
The staff has not developed any precise formula to apply these Che[_
factors nor can such a formula be develcped.
Rather, the staff will apply these factors in a particular case and weigh them and any other relevant information such as the significance of 4,h.
the deficiencies identified, the ' opportunities available to t.
identify and correct them, the time taken by the licensee to make a determination, the quality of the supportino analysis.
and the length of timeUhafare the 4asaactica m caaducted.
I These factors are interrelated and must be balanced to determine N
M the appropriate sanction.
The staff believes, as described in O'M the encTosed guidance, thatu minimum penalty of $50,000 should M $ c.it.a cta.5 be proposed for any licensee that clearly knew or,should have
,i.rh known its equipment was not qualified on November 30, 1985.
If the penalty is over $300,000, under the Enforcement Policy, consultation with the Commission is required.
.The Comissioners.
Recomendation:
Unless the Comission directs otherwise, this enforcement guidance will be distributed to the Regions for implementation within ten days of the date of this paper and by appropriate generic comunications to the licensees.
O tel Executive Director for Operations
Enclosure:
Proposed Enforcement Criteria SECY NOTE:
In the absence of instructions to the contrary, SECY will notify the staff on Tuesday, May 6, 1986 that the Commission, by negative consent, assents to the action proposed in this paper.
DISTRIBUTION:
Commissioners OGC OPE OI OCA OIA OPA REGIONAL OFFICES EDO ELD ACRS ASLBP ASLAP SECY l
l i
J ENFORCEMENT CRITERIA FOR EQ ENFORCEMENT Application of the " Clearly knew, or should have known" test
,i The staff believes it is unlikely that licensees will be identified that
" clearly knew" they had equipment for which qualification cannot be established.
The staff believes from discussions with licensees that all licensees who were aware before November 30 that they had equipment for which qualification could not be established elected to shut down rather than operate in noncompliance under the daily penalty provision. Thus, the issue in most cases will be for the staff to determine whether the licensee Mhould have known" that its og,,ely..
equipment was not qualified.
Tije staff will examine the circumstances in each case to make the determination.
The fact' ors the staff will examine include:
1.
Did the licensee have vendor-supplied d' ocumentation that demonstrated that the equipment was qualified?
2.
Did the licensee perform adequate receiving and/or field verification inspection to determine that the configuration of the installed equipment matched the configuration of the equipment that was qualified by the vendor?
i' 3.
Did the licensee have prior notice from any source that equipment qualification deficiencies might exist?
4.
Did some licensees identify similar problems and correct them before the deadline?
To illustrate how these factors would be applied in specific cases, the staff will use as an example in the discussion which follows deficiencies in the qualification of the internal wiring of certain valve operators recently identified at several plants.
Vendor EQ test reports provided to licensees were ambiguous regarding whether the internal wiring of the operators was qualified by the reports.
It has now been determined that vendor EQ test reports did not include qualification of the internal wiring of the operators and that the wiring used in the test operators could be different than the l
wiring installed in production units.
Subsequent wiring modifications by the valve manufacturer or by the installer have introduced additional wiring which was not covered by the operator qualification reports.
Physical inspection has shown instances of unidentified or not qualified wiring installed in l
several valve operators.
i These operators are used on a wide variety of valves at the plants and in many L
cases were used on valves which were part of systems covered by technical l
specifications (TS) such as containment isolation valves. The wiring in the sigm{.o)erators should have been qualified by November 30, 1985. Thus, any planto at t
ic. cat w11ch suchVdeficiencies are identified after the deadline and which operated in i
r noncompliance are subject to a possible penalty of $5,00 per item per day if such licensees clearly knew or should have known of th deficiencies.
In some a
plants, this could amount to a substantial penalty,ie excess ef $1,000,000.
l
-'Icarb l
{.c &k 4,ence 4es%g or analysis is reguire.d to estal>lish guaIqicalion I _ __
- - ' - - - - - -----~
~ ~ - '
. With regard to the first two factors, reliance on vendor-supplied information on testing of equipment and performance of receiving and/or field verification inspections, the licensees took the position that the EQ test reports provided by the vendor covered the wiring and did not perform adequate receiving or field verification inspections to positively identify the internal wiring.
We and the licensees now know that the vendor test reports did not cover the i
wiring in the operators.
In addressing qualification by test, paragraph (f) of 10 CFR 50.49 requires that'each item of electrical equipment important to safety must be qualified by testing an identical item or testing a similar item with supporting analysis that the equipment to be qualified is acceptable.
It may not be reasonable to rely entirely on vendor-supplied information in establishing similarity since changes to complex equipment are likely to occur during the manufacturing process and/or installation. A comprehensive receiving and/or field verification inspection of the equipment by the licensees should be conducted to identify significant discrepancies between the as-installed vs. qualified configurations.
With regard to the third factor, prior notice of similar problems, the results of one field verification inspection of equipment prompted IE to issue an Information Notice in 1983 to alert licensees to several deficiencies affecting equipment qualification. This notice discussed a construction deficiency report related to inspection of valve operators at a plant under construction. Among several specific qualification-related concerns, this Notice stated that "No identification was evident on certain material, internal to the valve omrators (e.g., wiring, insulation, etc.)" and stated :t:at "It is not presently cnown whether these types are qualified for the service conditions." This Information Notice also highlighted the fact that "Information obtained from purchase order i
files and qualification files does not agree with the installed components."
Based on the above, the staff conc ~1uded this document provided prior notice of l
the potential problems with certain valve operators.
Given this information, it was unreasonable for ifcensees to rely entirely on the vendor reports without doing additional work to ensure that the wiring was qualified.
With regard to the fourth factor, some licensees di~d identify and correct this problem before the November 20, 1985 deadline. The unqualified wiring was identified by these licensees as a result of walkdown verification of the installed equipment or comprehensive review of qualification files.
After consideration of all of these factors, the staff has concluded that in the case of the Limitorque wiring, licensees "sshould have known" that the 4,,,
vendor documentation was not adequate to support, qualification.
(
Time period to be Considered for Daily Civil Penalty Once the staff concludes that the " clearly knew or should have known" test L
is applicable, the staff must determine the appropriate piriod over which to I
assess a daily civil penalty. The staff has concluded that the appropriate period is from November 30, 1985 to the time the licensee completes its evaluation and schedules corrective action.
This approach should encourage 1
timely identification and evaluations by licensees of the qualification of the equipment. A licensee should not be penalized for each day after the problem I
l t
i
.,.v,,,-n
--,.__-.,n-
e
~
" is identified and appropriate corrective action is scheduled that it elects to operate until the problem is fixed assuming a reasonable determination was made that it was safe to allow continued operation.
Imposing daily civil penalties until the violation is corrected would provide strong incentives for shutdown even though the licensee had determined that continued operation for some reasonable period of time is not unsafe.
However, if the licensee's determination that it was safe to operate is later found to be in error, shut down may be required and the licensee may be subject to daily civil penalties.O Similarly, g
since the reasonableness of the schedule for corrective action is a factor to be considered for mitigation of the daily civil penalty, if the licensee i
fails to meet its schedule, additional civil penalties will be considered.
In the case of the valve operators described above, in one hypothetical situation, suppose that a Resident Inspector notified one licensee two weeks after the deadline that the qualification of the valve operators was suspect.
That licensee evaluated the situation and concluded that the qualification of the wiring could not be verified. The licensee performed a final evaluation two weeks later justifying continued operation with the unqualified equipment l
and planned to replace the equipment at the next scheduled refueling outage in two, months. The staff would conclude that this licensee would be subject to l
a daily civil penalty of $5,000/ item / day for 28 days.
Application of the Mitigation Factors Once it has been determined that a licensee may be subject to a daily civil penalty under this test, Generic Letter 85-15 specifies that the staff should apply certain mitigation factors to determine the amount of the proposed penalty. The factors specified in the letter were:
1.
Did the licensee identify and promptly report the noncompliance with 10 CFR 50.49?
2.
Did the licensee apply best efforts to complete environmental qualification within the deadline?
3.
Has the licensee proposed actions which can be expected to result in full compliance within a reasonable time?
k.h e.
dimm.s These factors are self-explanatory.
In addition, the staff would consider e.u de.d the circumstances of each particular case including the significance of the
% Lee deficiencies identified, the opportunities available to identify and correct 6dsb.
them, the time taken by the licensee to make a determination, the quality of the supporting analysis, and the length of tini&^befcre the Npectic" H5 eonducted. The following discussion illustrates how these mitigation factors
<~
would be applied in the hypothetical case of a licensee which identified the valve operator problem.
We assume that the licensee identified the potential problem with qualification of the internal wiring of valve operators after conversations with the NRC Resident Inspector. We assume that it immediately initiated a timely investigation, detennined that qualification of its valve operators was not fully supported due to problems with the internal wiring, and notified the
.-----,----..------.,...n
,,,---.,--__.n, n.,-
n
- - - - - - - + - - - - - - - - - - - - -...
,7
. NRC of this determination via telephone and continued to evaluate the problem.
'Within two weeks of becoming aware of the problem, the licensee submitted a 10 CFR Part 21 report to the NRC. Included in this submittal was the licensee's justification for continued operation of the plant and a plan for corrective action.
Further we assume that the licensee actively worked to achieve its.10 CFR 50.49 deadline of the second refueling outage after March 31, 1982 and was able to meet it except for some items of equipment for which justifications for continued operation (JCOs) had been approved.
Later, NRC was notified by telephone that all work on equipment scheduled for replacement and/or relocation and covered by the previously approved JCOs had been accomplished.
Thertfore, all equipment within the scope of 10 CFR 50.49 was believed to be qualified well before the November 30, 1985 deadline.
Finally, we assume that this licensee's 10 CFR Part 21 report submitted to the NRC included a schedule for corrective actions to establish qualification of the wiring of all valve operators within the scope of 10 CFR 50.49 and that this schedule called for the replacement of e~xisting wiring with qualified
.g."g wiring on all affected operators within two months.
The staff has concluded that this licensee would be entitled to complete citigation under these factors. However,vth: lic :::: =:
- vie!stf e c' the rele^ cr M ve-^ r 30 and :::: civ'l p ::lty :h::ld b: imp::d in :ny :::nt.
Thus, the staff has concluded that the daily civil penalty should be adjusted g
in accordance with the factors but the civil penalty levied should not be lower than $50,000, the base civil penalty for an ordinary Severity Level III violation, Oc.
in any case in whictOthe licensee " clearly knew or should have known" th:t it:-
equipment ver act eF#fet e.xistect b.bn. he. 6%be.c so de.d t.m e..
Other Enforcement Regardint Violations of EQ Requirements Identified at Plants Operating After November 30 M nspecti6ns at If violations of the EQ rule identified during firs't-round i
plants operating after November 30, 1985 apparently existed before the deadline, j
then the " clearly knew or should have known" test should be applied.
If the licensee meets the test, enforcement should be taken as described above.
If the licensee does not meet this test, no enforcement action should be taken.
If the licensee could not have reasonably been expected to dis:over the problem before the November 30 deadline, presumably the noncompliance could not have been avoided and enforcement action to deter future noncompliance would serve no purpose.
If the violations of the EQ rule identified after November 30, 1985 do not relate back to action or lack of action before the deadline, e.g., a modification was made -in January 1986 that created the violation, or are identified after first-round inspections are completed, enforcement should be taken under the current Enforcement Policy. The present policy states as an example of 1/ First-round inspections are special team inspections to review licensees' compliance with 10 CFR 50.49.
i
O Severity Level III: "2.
A system designed to prevent or mitigate a serious safety event not being able to perform its intended function under certain conditions (e.g., safety system not operable unless offsite power is available; materials or components not environmentally qualified)."
Thus, no changes to the Enforcement Policy are necessary to take into account EQ violations.
Consistent with the interpretations of the Enforcement Policy in other areas, less significant violations that indicate a programmatic breakdown can also be grouped and categorized as Severity Level III violations.
For licensees that were not in compliance with the rule before the November 30, 1985 deadline and did not submit timely requests for extension, but which did not operate in noncompliance after the deadline, consistent with the Commission's direction in response to SECY 85-220, (Memorandum from S. J. Chilk to W. J.
Dircks, August 27,1985) the staff will exercise enforcement discretion after considering whether adequate JCO's were provided and whether an extension would have been granted if timely filed.
O
d' i
INSERTS FOR SECY 86-122 Insert A j
Since such penalties are likely to quickly become abnormally high, particularly as the length of time between the November 30 deadline and.
3 the date of inspection increases, the staff has determined that some cap on the possible amount of the civil penalty should be imposed. The staff has detennined.that this is appropriate especially for those cases in closet.s which the 'jkhould have known" test is applied as opposed to cases in which the licensee " clearly knew" that they were not in compliance..The staff ree item has selected a cap of $500,000 or approximately the amount that would be 4
imposed for one item that was deficient for 100 days after the deadline.
~
The mitigation factors would then be applied to mitigate from $500,000 per itens down if appropriate.
If th ifclati;n ;ntince: f:r ::b::::ti:?!; !:r; r then 100 deys, t' Er w;uld be ;;nsid; red in dctcraining th; :ppr:grict:
-iti;;ti;a. Similarly, since the reasonableness of the schedule for corrective action is a factor to be...
Insert B
... to be fair and equitable to those licensees who either took appropriate actions prior to November 30 or shutdown on November 30 in order to be in compliance, some civil penalty should be imposed.
Insert C
... significant deficiencies remained at the close of the inspection for which further testing or analysis was required to establish qualification and which...
i
..