ML22220A259

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Transcript - Public Meeting with CRGR to Discuss Potential Backfitting Associated with Draft RIS on Operating Leakage
ML22220A259
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Issue date: 05/13/2022
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Office of Nuclear Regulatory Research
To:
N. DiFrancesco
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NRC-1942
Download: ML22220A259 (100)


Text

Official Transcript of Proceedings NUCLEAR REGULATORY COMMISSION

Title:

Meeting with CRGR to Discuss Potential Backfitting Associated with Draft Ris on Operating Leakage Docket Number:

(n/a)

Location:

teleconference Date:

Friday, May 13, 2022 Work Order No.:

NRC-1942 Pages 1-100 NEAL R. GROSS AND CO., INC.

Court Reporters and Transcribers 1716 14th Street, N.W.

Washington, D.C. 20009 (202) 234-4433

1 U.S. NUCLEAR REGULATORY COMMISSION 1

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2 PUBLIC MEETING 3

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4 MEETING WITH CRGR TO DISCUSS POTENTIAL BACKFITTING 5

ASSOCIATED WITH DRAFT RIS ON 6

OPERATING LEAKAGE 7

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8 FRIDAY 9

MAY 13, 2022 10

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11 The Public Meeting met via Video 12 Teleconference, at 9:00 a.m. EDT, Stephanie Coffin 13 and Thomas Basso, Facilitators, presiding.

14 CRGR MEMBERS PRESENT 15 STEPHANIE COFFIN, Facilitator, CRGR Chair, RES 16 NICHOLAS DiFRANCESCO, CRGR Staff 17 CRAIG ERLANGER, NSIR 18 ANDREA KOCK, NRR 19 ROBERT LEWIS, NMSS 20 RAYMOND LORSON, RI 21 SUSAN VRAHORETIS, OGC 22 23 24 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

2 NEI AND INDUSTRY PRESENT 1

THOMAS BASSO, Facilitator, NEI 2

JERRY BONANNO, NEI 3

DAVID GULLOTT, Constellation 4

DANIEL LAMOND, GSE TrueNorth Consulting 5

MARTIN MURPHY, Xcel Energy 6

JAMES POLICKOSKI, TVA 7

DARANI REDDICK, Constellation 8

9 ALSO PRESENT 10 NICHOLAS DiFRANCESCO, CRGR Staff 11 CHRISTOPHER TYREE, NRR 12 13 14 15 16 17 18 19 20 21 22 23 24 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

3 P-R-O-C-E-E-D-I-N-G-S 1

9:00 a.m.

2 MS. COFFIN: I just want to welcome 3

everybody. Good morning. My name is Stephanie 4

Coffin. I'm the Chair of the Committee to Review 5

Generic Requirements. I expect to have the full CRGR 6

complement here and I also want to introduce Nick 7

DiFrancesco, if you can wave your hand, Nick. Nick is 8

the Acting Program Manager for the CRGR.

9 Our purpose today is to talk about a 10 regulatory issue summary that was issued in January 11 concerning operational leakage and Industry has sent 12 in a letter and they also responded to the RIS in the 13 comment period with backfitting concerns and they 14 requested this meeting with the CRGR. We really 15 appreciate that. It's one of our goals to be 16 transparent and to be open and so we look forward to 17 today's discussion.

18 Let me see, just for folks who may not be 19 that familiar with the CRGR, one of the purposes of 20 the CRGR is to provide guidance and assistance to the 21 staff and oversight that the Commission's backfitting 22 policies are being implemented correctly. So that is 23 our role here. Let's see, I think I want to introduce 24 the CRGR members and so I'll just say your name and 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

4 then if you can introduce yourself and your office 1

just to give Industry a sense of kind of your 2

background. I'll just do it based on who I see on the 3

screen. Craig Erlanger?

4 MR. ERLANGER: Good morning everyone. My 5

name is Craig Erlanger. I'm the Deputy Office 6

Director for the Office of Nuclear Security and 7

Incident Response.

8 MS. COFFIN: And Rob Lewis?

9 MR. LEWIS: Good morning. I'm Rob, I'm 10 the Deputy Director for the Office of Nuclear Material 11 Safety and Safeguards.

12 MS. COFFIN: Thank you. Ray Lorson?

13 MR. LORSON: Good morning. Ray Lorson, 14 I'm the Deputy Regional Administrator the NRC's Region 15 One Office.

16 MS. COFFIN: Susan Vrahoretis?

17 MS. VRAHORETIS: Good morning. I'm Susan 18 Vrahoretis. I'm the Assistant General Counsel for 19 Reactor Programs in the Office of the General Counsel.

20 MS. COFFIN: Andrea Kock?

21 MS. KOCK: Good morning. I'm Andrea Kock.

22 I'm a Deputy Office Director for Engineering in the 23 Office of Nuclear Reactor Regulation.

24 MS. COFFIN: Thank you. So those are your 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

5 CRGR members. Today's meeting is being transcribed so 1

we have a court reporter here. I think his name is 2

Sam and Sam, if you have any guidance for us as we 3

engage to help you with your job, I'll pause now and 4

give you a chance to speak if you have any advice for 5

us. Okay, all right, thanks very much.

6 Let's see, let me look through my notes 7

here and see. In terms of what to expect, CRGR will 8

not be making a decision today. Today is a listening 9

session. We do expect to caucus afterwards and engage 10 the staff if necessary in the following days and days 11 to come.

12 At the end of the meeting, we will allow 13 time to see if there are any questions from the 14 public. I do want to remind the attendees that today 15 is an observation meeting, so it's really between the 16 CRGR and NEI and Industry.

17 Let's see, Nick or any of the CRGR 18 members, any other things you want to add or 19 housekeeping or any other comments? Okay. I'll turn 20 it over to you, Tom. Please let us know how you would 21 like to take questions. If you would like us to, we 22 can probably raise hands it's probably the best way.

23 You may not be able to see hands so Nick if you could 24 help Tom know if he needs to pause. I do see a hand 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

6 up right now from Christopher Tyree. Christopher?

1 MR.

TYREE:

I'm

sorry, that was 2

accidental.

3 MS. COFFIN: Okay. All right, welcome.

4 (Laughter.) Welcome to Teams. All right and so, Tom, 5

let us know how you would prefer questions.

6 MR. BASSO: Yes, Stephanie, we'll take 7

questions at any time during the presentation and then 8

we will specifically pause at certain times to see if 9

there are any questions before moving on to another 10 item or position. Okay?

11 MS. COFFIN: Okay that sounds terrific.

12 MR. BASSO: Okay, how about I go through 13 and we'll introduce our team and then we'll get into 14 some opening remarks. My name is Tom Basso. I'm the 15 Senior Director of Engineering and Risk at NEI and I'm 16 on loan from Constellation.

I've been at 17 Constellation going on almost 40 years. So, with 18 that, let me go through and I'll introduce our team.

19 Jerry?

20 MR. BONANNO: Hello. Jerry Bonanno. Good 21 morning everyone. I am the Associate General Counsel 22 with NEI.

23 MR. BASSO: Darani?

24 MS. REDDICK: Good morning everyone. I'm 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

7 Darani Reddick. I'm the Licensing Director at 1

Constellation.

2 MR. BASSO: Dave?

3 MR. GULLOTT: Dave Gullott. I am the 4

Licensing Director at Constellation for our Midwest 5

Plant.

6 MR. BASSO: Okay, Marty?

7 MR. MURPHY: Marty Murphy. Director of 8

Regulatory Affairs for Xcel Energy.

9 MR. BASSO: Dan?

10 MR. LAMOND: Good morning. Dan Lamond, 11 GSE TrueNorth Consulting, one of two current Vice 12 Chairs for ASME Standards Committee 11 and I'm the 13 current Chair of our Executive Committee.

14 MR. BASSO: And Jim?

15 MR. POLICKOSKI: Hey, good morning. This 16 is Jim Polickoski. I'm Director of Nuclear Regulatory 17 Affairs for the TVA Operating Fleet.

18 MR. BASSO: Okay, Stephanie, those are the 19 folks that will be making our presentation and 20 answering any questions during the meeting.

21 MS. COFFIN: Very good. Thank you, 22 welcome.

23 MR. BASSO: Thanks. So, why don't we get 24 started. Again, we appreciate the opportunity on 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

8 behalf of the NEI and members to present and discuss 1

the bases for our comments and concerns with the Draft 2

Regulatory Issue Summary and Operational Leakage.

3 Much of what we'll present was documented 4

in detailed comments that we submitted on March 15th.

5 We'll provide, you know, clarification and an 6

opportunity for dialogue to ensure understanding of 7

the key points in that letter.

8 The interactions and discussions with the 9

Industry on handling operational leakage have been 10 going on since the early 1980s, maybe even earlier.

11 More recently, prior to the Draft Regulatory Issue 12 Summary, the NRC proposed a condition on operational 13 leakage as part of the 10 CFR 50.55(a) Codes and 14 Standards rule change. That proposed condition was 15 subsequently not included as part of the rule change 16 after several public meetings and submittals of 17 letters expressing the same concerns and objections 18 that we're going to present today.

19 So, again, we appreciate the opportunity 20 and now we'll present the Industry's perspective on 21 why the RIS imposes a new requirement would adversely 22 impact the Industry and should be considered as a 23 backfit. Just again, feel free to stop us at any time 24 for questions and then we'll pause at certain points 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

9 for any questions. So at this time --

1 MS. COFFIN: Hey, Tom?

2 MR. BASSO: I'd like to --

3 MS. COFFIN: Tom?

4 MR.

BASSO:

I see Ray has his 5

(Simultaneous speaking.)

6 MS. COFFIN: Tom?

7 MR. BASSO: Yes?

8 MS. COFFIN: We do have a question from 9

Ray Lorson, one of our CRGR members.

10 MR. BASSO: Okay, Ray?

11 MR. LORSON: Yes, hi, Tom. Just one 12 question for clarification. The title talks about 13 industry perspectives. NEI does not represent the 14 entire industry. I'm just curious if you have any 15 input from either nexAir or Entergy or are they part 16 of this presentation as well?

17 MR. BASSO: They're not part of the 18 presentation, but I have at least interacted with a 19 representative from Entergy, who is on the Code 20 Committee and he's been involved throughout this 21 process.

22 MR. LORSON: Okay, thank you.

23 MR. BASSO: Okay, thanks. So appreciate 24 that comment and good, stop us at any time. With 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

10 that, let me introduce Jerry Bonanno. He's going to 1

begin our presentation and also an overview of the 2

regulatory position, so Jerry.

3 MR. BONANNO: Sure you can go to the next 4

slide, Tom. Thanks again. Again, Jerry Bonanno from 5

NEI. I just want to echo Tom's comments and say thank 6

you to the CRGR again for providing the opportunity.

7 I've been involved in the last few of these 8

interactions with CRGR and I know we've found them 9

really worthwhile, so we hope to continue that trend 10 today and provide you some useful information here in 11 your consideration of the RIS.

12 The presentation really, I think, breaks 13 down into three sections. So, Darani and I are going 14 to first talk about our regulatory position and 15 backfitting positions on the RIS.

16 Next, Dan will pick up and provide ASME's 17 perspectives on Section 11, including ASME's current 18 position on the applicability of Section 11 to 19 operational leakage and licensee operability 20 determinations.

21 Then David will pick up and provide 22 insights on the operability process itself and talk 23 about the distinction between operability 24 determinations and corrective actions and also a 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

11 little bit more about the practical impacts of the 1

Draft RIS, if it's finalized in its current form.

2 Marty and Jim, I know, will also be 3

offering insights during that portion of the 4

presentation. And then, I think Jim will close with 5

some concluding remarks.

6 Like Tom said, we're happy to entertain 7

questions, but we will kind of pause at the end of 8

each one of these three sections. They're kind of 9

subject matter blocks so it may be helpful as you 10 process everything that's kind of said in that section 11 to ask questions. We will provide an opportunity for 12 you all to do that. Next slide, Tom.

13 All right, so we'll start with kind of an 14 overview of our regulatory and backfitting positions 15 on the Draft RIS. I wanted to just start by 16 recognizing we do understand the CRGR's primary 17 concern is the backfitting implications of the Draft 18 RIS and making sure that those are properly 19 considered, but I think like with a lot of backfitting 20 issues, understanding the underlying regulatory 21 position is important to kind of getting at what the 22 backfitting concerns are.

23 I'll spend a little bit of time up front 24 on the regulatory position and then Darani will pick 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

12 up with a discussion of the specific backfitting 1

concerns that we have.

2 I wanted to start out just by first kind 3

of making clear that I think we do agree that when 4

operational leakage is detected that operability needs 5

to be evaluated. However, we do disagree with the 6

positions in the Draft RIS that limit the methods 7

available to licensees to evaluate the operability of 8

specifically Code Class 2 and 3 components that are 9

experiencing operational leakage. Specifically, we 10 don't agree that the NRC's requirements limit 11 licensees to using the evaluation characterization and 12 corrective action methods that are described in 13 Section 11 exclusively to determine operability of 14 Code Class 2 or 3 SSCs.

15 In our view, finalizing the Draft RIS in 16 its current form would actually constitute an 17 effective amendment of the regulations in 10 CFR 18 50.55(a) and impose it on analyzed backfit.

19 I'll spend a few minutes on packing those 20 conclusions so we can talk a little bit more about how 21 we got there. I did want to make clear and I think 22 the group wanted to make clear up front that we do 23 recognize that the tech specs generally prohibit 24 leakage in the reactor coolant system pressure 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

13 boundary, that roughly correlates to Code Class 1 1

components.

2 The positions that we are taking in the 3

March 15th letter that we submitted in today are 4

really specific to Class 1 and 2 components.

5 Sometimes this can be, as you all know, a pretty 6

involved area to discuss so if that gets lost in the 7

conversation, I just wanted to make that clear up 8

front, that that's really what we're focused on here.

9 So, Tom, you can go to the next slide, please.

10 Okay, so where do we kind of start from a 11 regulatory standpoint? I think 50.55(a) and the 12 underlying Code are for the uninitiated not the 13 easiest portions of the NRC's requirements to read.

14 It's a pretty dense section of the regulations, but 15 that said, although the regulatory issue we think is 16 multilayered, from our perspective, it's relatively 17 straight forward and we think the language of the Code 18 and the rules, the NRC's regulations, are unambiguous.

19 The Draft RIS takes the position that 20 licensee's must address operational leakage in the 21 same manner as leakage detected during Section 11 22 pressure tests or inspections and, more specifically, 23 that when operational leakage is detected in a Class 24 2 or 3 component and the operability of that component 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

14 needs to be determined, that Section 11 methods must 1

be used to determine whether the SSC is operable.

2 For us, you know, the first step in 3

evaluating that position was to try and identify the 4

source of the legally binding requirement that imposes 5

it. In this case, I think there's three really 6

potential sources of requirements.

7 One is Section 11 of the Code itself, 8

which is kind of the foundation. The other is the 10 9

CFR 50.55(a), which of course, incorporates Section 11 10 by reference into the NRC's regulations. Then, 11 thirdly, the plant tech specs are also relevant. I 12 think the Draft RIS focuses on 50.55(a) as, I think, 13 the operative regulation that imposes the requirement 14 and so our presentation here and our comment letter 15 focused on Section 11 itself and 10 CFR 50.55(a).

16 But just with respect to the tech specs, 17 I mean we're not aware of a tech spec requirement that 18 imposes the specific requirement that's articulated in 19 the RIS. I know the tech specs were discussed in 20 general in the RIS, but the RIS also doesn't cite any 21 specific tech spec language or specific tech specs 22 that impose this requirement. That's why we're really 23 focused primarily on Section 11 and 50.55(a). Next 24 slide, Tom.

25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

15 Okay, you start with Section 11 itself and 1

Section 11 is relevant here from a regulatory 2

standpoint, of course, because it's incorporated.

3 It's a consensus standard that's incorporated by 4

reference through 50.55(a) of the NRC's regulations.

5 Section 11 has essentially been made legally binding 6

on licensee's through the incorporation by reference 7

process. That process, of course, is implemented 8

through the Notice and Comment Rule Making process.

9 In our view, the text of Section 11 is 10 unambiguous and clear and that when Code language is 11 examined, it's clear that, for example, the flow 12 evaluation and characterization requirements in 13 articles IWA 3100 and 3300 apply only to flaws 14 detected during pre-service and inservice examinations 15 and further, the Code is clear that the corrective 16 action requirements in IWA 52.50 apply only to sources 17 of leakage discovered during inservice pressure tests.

18 I don't want to go too deep into the Code 19 itself because I think Dan's going to provide a nice 20 overview of the Code, but I think this is the starting 21 point for the analysis. I think, in our view, both 22 ASME and NRC have acknowledged the limitations of the 23 Code with respect to operational leakage. If you've 24 had a chance to read our March 15th letter, you know 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

16 there is a well documented exchange between ASME and 1

the NRC that ran from about 2006 to 2015 on a number 2

of issues related to Section 11, one of which was 3

whether Section 11 should be amended to cover or 4

address operational leakage. I think that Dan will 5

talk about that interaction. He was, I think, 6

directly involved in that.

7 But at the end of the day, I think this 8

letter, which is the July 14, 2015 letter, which 9

closed that interaction between NRC and ASME, clearly 10 states that "current ASME Code Section 11 provides 11 requirements with leakage is found during a pressure 12 test in all components; however, it doesn't provide 13 requirements other than to repair and replacement for 14 repair and replacement activities when a leak is found 15 at a time that's not associated with a Code-required 16 pressure test." Then the NRC goes on to recognize 17 that it needs to take a look at whether additional 18 regulatory activities are necessary to address 19 operational leakage.

20 We talk about this to say I think that 21 it's pretty clear, at least from our point of view, 22 that the Code itself by its own terms does not apply 23 to operational leakage, again outside of the repair 24 and replacement provisions that are provided in IWA 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

17 4000. Next slide, Tom.

1 But, obviously that doesn't end the 2

inquiry. I think the position that's taken in the 3

Draft RIS is really more about whether 50.55(a) when 4

it incorporated Section 11 by reference, expanded the 5

applicability of the Code to cover operational 6

leakage. It's clear that the NRC could have, I think, 7

conditioned or otherwise expanded the applicability of 8

Section 11 through the rule making process used to 9

incorporate the Code by reference. I think there are 10 over 30 conditions on the use of Section 11 provided 11 in 50.55(a) so the agency clearly does that when it's 12 necessary.

13 I think what the RIS points to is the RIS 14 doesn't point to 50.55(a)(b)(2), which is good because 15 there's no condition that expands the applicability of 16 Section 11 to address operational leakage in (b)(2),

17 but it looks like what the RIS points at is paragraph 18 (g)(4), which are the inservice inspection standards 19 for operating the plants.

20 The next thing we did was take a look at 21 the language in (g)(4). When you move on to the 22 language in (g)(4), I think again 50.55(a) can be a 23 little challenging, but the language that's quoted on 24 this slide is what we think the relevant language in 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

18 (g)(4) is.

1 I will take a second just to read it. So, 2

(g)(4) says, "throughout the service life of a water 3

cooled nuclear power facility, components including 4

supports that are classified as ASME Code Class 1, 5

Class 2 and Class 3 must meet the requirements set 6

forth in Section 11 of additions and addenda of the 7

ASME BPV Code that become effective subsequent to 8

additions specified in paragraphs (g)(2) and (g)(3) of 9

this section and that are incorporated by reference in 10 subparagraph (a)(1)(2) to the extent practical."

11 So, what is paragraph (g)(4) saying? In 12 our view, this is pretty clear and unambiguously 13 essentially saying that when new additions or addenda 14 of Section 11 are incorporated by reference in the 15 future, i.e., throughout the service life of the 16 plant, that licensees have to comply with those new 17 additions or addenda of the Code to the extent 18 practical.

19 So, (g)(4) in our view is simply providing 20 notice that the revised additions and addenda of 21 Section 11 will be incorporated by reference 22 throughout a reactor's service life and that licensees 23 will be expected to come into compliance with those 24 new additions or addenda, but what it doesn't do, 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

19 again in our view, is substantively revise the scope 1

of Section 11. It doesn't go in and revise the Code 2

itself. It's simply a statement about how the Code 3

will apply over time. I think we believe this meaning 4

is plain from the language in Section (g)(4) and I 5

think when we look through the regulatory history, 6

that reading is confirmed when we take a look at, for 7

example, the 1976 Rule Making that promulgated the 8

current iteration of paragraph (g) and then again, in 9

the 1992 Rule Making that moved the inservice testing 10 requirements from paragraph (g) to paragraph (f).

11 In that 1992 Rule Making, I think the 12 Commission made clear that the intent of paragraph (g) 13 was to be "the basis for selecting the addition and 14 addenda of Section 11 to be complied with during the 15 pre-service inspection, initial 10-year inspection 16 interval and successive 10-year inspection intervals."

17 So in sum, our position on paragraph 18 (g)(4) is that it doesn't support the position taken 19 in Draft RIS, specifically paragraph (g)(4) doesn't 20 expand the applicability of the ASME Code to impose 21 the evaluation and characterization or the corrective 22 action methods provided in Section 11 as the exclusive 23 means available to licensees to demonstrate 24 operability of Class 2 and 3 SSCs that are 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

20 experiencing operational leakage. So, these methods 1

may be useful in operability space and, I think our 2

technical folks and reg affair's folks can talk more 3

to this, but I think they have been used and can be 4

used when they're available, when there is a Code 5

method available and when it can be applied, but our 6

position here is that (g)(4) does not limit the 7

licensee to using those methods when they're doing an 8

operability determination. Next slide.

9 I think there's a hand up.

10 MR.

DiFRANCESCO:

Well

first, 11 (Simultaneous speaking.) oh, go ahead Ray and then 12 (Simultaneous speaking.)

13 MR. LORSON: I can wait until the end of 14 this slide. I just wanted to try to find the right 15 time. I did have a question on the preceding slide, 16 but I can ask it now.

17 MR. BONANNO: Okay, sure.

18 MR. LORSON: Okay, really it's two 19 questions. First, you have something there at the 20 beginning of the slide that talks about throughout the 21 service life. I'm just curious of how you consider 22 operational, you know, reactor operation to be part of 23 the service life or is service life only, you know, is 24 there like a boundary on it that only applies to Code 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

21 11 testing? You know, Section 11 testing. So that's 1

the first question.

2 MR. BONANNO: All right.

3 MR. LORSON: The second question is you 4

talk about not limiting the evaluation of a flaw, just 5

strictly Section 11 methods, I'd be interested in the 6

other types of methods that would be considered and 7

how applying Section 11 as opposed to some other 8

method of analysis presents an undue burden. Thanks.

9 Two questions.

10 MR. BONANNO: So, on the first on, Ray, I 11 think the service life of a water-cooled nuclear power 12 facility in (g)(4), I don't think we're limiting it.

13 I think that in our view that's the operating life of 14 the facility. So it's not limited to the inservice 15 inspection intervals or anything like that.

16 I think the way we're reading this though 17 is the direction that's being provided in (g)(4) that 18 has to happen over the service life, is compliance 19 with the Code additions and addenda that are 20 incorporated by reference after the initial additions 21 and addenda in (g)(2) and (g)(3). So, it's a 22 statement about what the licensee needs to comply with 23 going forward. Our view here is that it doesn't 24 expand the applicability of the Code itself. It's not 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

22 a substantive change to the Code. So that's the first 1

question.

2 The second question, I know Dave's going 3

to address some of the practical implications of this 4

at the end of the presentation. I don't know if Dave 5

or Marty or Jim want to weigh in now on that.

6 MR. GULLOTT: Ray, could you repeat that 7

second question?

8 MR. LORSON: Yeah, the second question 9

relates to there was a statement that the view of NEI 10 is that there's nothing in the regulations that kind 11 of requires the evaluation of an operational leakage, 12 you know, flaws detected outside of the planned 13 Section 11 inspection, to exclusively use Section 11 14 criteria for addressing that flaw or leak. And that 15 other methods can be used acceptably, I think that was 16 the -- maybe I'm paraphrasing what I heard. So what 17 I was just trying to understand is, what would be the 18 practical difference between using some other method 19 vice complying with the Section 11 requirements.

20 Where's the difference or burden? What specifically 21 won't be done as part of addressing operational 22 leakage that would be required under Section 11? I'm 23 just trying to understand if there's role of practical 24 difference.

25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

23 MR. GULLOTT: At a high level, if an 1

approved method exists, typically they're used.

2 However, there may be an approved method that limits 3

the temperature or pressure that it can applied to and 4

we may have a system, and had in the past a system 5

that has an operating temperature pressure that's 6

higher, but technically there's still sound 7

engineering judgment that can allow you to use that 8

approved method at a condition that it is not 9

specifically approved for. That would be one 10 opportunity.

11 Other times there may be a configuration 12 where an approved method would require a specific sort 13 of NDE that just cannot be performed just because of 14 the configuration or the limitations on sizing or 15 other aspects.

16 MR. BASSO: Hey, Ray? If I may add also 17 that the impractical piece of it is there are a lot of 18 configurations and conditions where Section 11 does 19 not provide a methodology. So the way the RIS is laid 20 out is, we would have to seek regulatory relief in 21 order to apply them, if they're even necessary.

22 In a lot of cases, you can make an 23 operability call without some of the detailed 24 evaluation methods. However, that would require, and 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

24 in some cases could lead to, a system being pulled out 1

of service or even a plant shut down. So the 2

impracticality is that Section 11 doesn't address all 3

of these conditions and operability can be made in a 4

lot of cases and to try to seek relief in a timely 5

manner could jeopardize taking the system out of 6

service or continued operation of a

plant 7

unnecessarily.

8 MR. MURPHY: Ray, this is Marty Murphy.

9 I'd just like to add and we'll touch on this later, as 10 you're well aware, operability is a continuous 11 process. So that initial determination is made with 12 the best available information and then we may 13 continue to seek additional information to further 14 understand the condition and the operability.

15 MR. DiFRANCESCO: And then going to the 16 next raised hand, Andrea has a question.

17 MS. KOCK: Sorry, I had a little trouble 18 getting off mute there. I have the same question as 19 Ray about how you interpret throughout the service 20 life. Because I think that's an important part of the 21 regulation, but I think I understand what you're 22 saying is that the way you interpret that is that you 23 have to implement the Code throughout the service life 24 of the facility, meaning during testing, and so you 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

25 wouldn't interpret it to mean just during operations.

1 So, I understand there's a difference there.

2 The other question I had was I think what 3

you're saying is the way you're interpreting 4

50.55(a)(g)(4) here is that it's simply pointing out 5

that licensees must apply that Code and subsequent 6

additions to the Code and so it's really just saying 7

when new additions come out, you must apply those, but 8

there's an and in the text there.

9 I'm just reading in plain language and 10 want to understand how you're reading it differently.

11 It's says throughout the service life, licensees must 12 apply the ASME Code, Edition 11 and addenda that come 13 out. So, I'm just reading the words and interested to 14 hear how you're interpreting it differently.

15 I thought what you said was you think this 16 is very simple, that it just says throughout the life 17 of the facility you must apply ASME Code 11 and 18 subsequent additions that come out, but there's an 19 and, so to me it says you have to apply the Code, 20 Section 11, throughout the service life and additions 21 that come out. Can you help me understand the way 22 you're interpreting that?

23 MR. BASSO: Yes, sure. That's a good 24 point. Yes, so I think we're saying the Code, this is 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

26 telling us you need to apply the Code throughout the 1

service life of the plant and the additions and 2

addenda that become available subsequent to those 3

specified in (g)(2) and (g)(3).

4 So, the point of this provision is that 5

you have to apply the Code as written throughout the 6

service life of the plant and any addition and addenda 7

that become available subsequently. So, in other 8

words, throughout the service life of the plant, we 9

don't read that as going in and substantively changing 10 the scope of the Code.

11 I think in order to do that, the NRC would 12 have to be very clear since it's incorporating the 13 Code by reference and the Code is going to become a 14 legally binding requirement. You would have to go in 15 and say hey

directly, we're expanding the 16 applicability of the Code. I mean the Code itself, by 17 its own terms, doesn't apply outside of the context of 18 the inservice inspections and testing.

19 I think the way we're reading this and I 20 think what it says is you apply the Code as it's 21 written throughout the service life of the plant and 22 then when new additions or addenda become available, 23 you need to come into compliance with those. That 24 happens in the future throughout the plant's operating 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

27 life.

1 MS. KOCK: Okay, so that does lead me to 2

another question that maybe you can address. I didn't 3

see it in the slides so maybe in a different portion 4

of the presentation you could address it. In areas 5

such as this of our regulations, the other way that we 6

establish precedent or the way the Commission is 7

interpreting the

rules, are through guidance 8

documents, statements of considerations and rule 9

makings and such and RIS. In the RIS, there's an 10 explanation of some additional documents that the 11 Commission has put out that point to how we're 12 interpreting this.

13 So when we look at backfit, it goes beyond 14 the rule, the language of the rule itself. We also 15 look is there a precedent established from the 16 Commission when these rules were set up or through 17 additional communications, such as generic letters and 18 such, and there's a lot of discussion in the RIS about 19 the way the staff is interpreting this language here 20 that goes beyond the language.

21 I would be interested to hear how you're 22 interpreting those other documents and how it relates 23 to this language because I think that's also 24 important. So, if you could address that as part of 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

28 the presentation or if we have time at the end, I'd 1

appreciate that.

2 MR. BASSO: Sure, so that's actually the 3

next slide. I think our March 15th letter does talk 4

about the different generic communications and letters 5

that are discussed in the Draft RIS, but I think as 6

kind of a starting proposition, our view is that 7

(g)(4) does not support this interpretation.

8 Our position is that any interpretation 9

that the staff was going to take, say in a generic 10 letter or in an inspection guidance or other guidance, 11 it needs to be supported by the language in the rule.

12 There is a line that can get crossed where you're no 13 longer interpreting rule language, you're actually 14 creating a new requirement and that's the position 15 that we're taking on this RIS.

16 We think, again, the language in (g)(4) is 17 clear on its face and the regulatory history of 18 (g)(4), I think, supports that reading. But more to 19 your point, Andrea, that's really our foundational 20 position here, but we do discuss the substance of each 21 one of those documents in our March 15th comments.

22 I think there's a couple of issues with 23 the documents themselves. One is I think they address 24 this issue kind of to varying degrees. I think they 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

29 all address Code compliance, but I think in our March 1

15th letter, we talk about, you know, for example, 2

Generic Letter 90-05, which really dealt with non-Code 3

repairs to Class 3 components. It didn't really 4

address this question about the methods to be used to 5

determine operability.

6 I think with RIS 2005-20, we looked at 7

that document and again that communicated, I think, 8

the first revision communicated a change to a staff 9

position that had been more categorical with respect 10 to declaring components inoperable when you detected 11 operational leakage.

12 It kind of took a little more flexible 13 approach in Revision One and in Revision Two, I think 14 notified folks that IMC 0326 had been published. That 15 RIS itself we don't think purported to impose any new 16 requirements on licensees.

17 I think really the clearest articulations 18 of this position that I've seen are in 0326, the 19 current version of 0326, which was, I think, finalized 20 in 2019 and then if you go back, for example, the 21 other document that's cited in the Draft RIS is the 22 Reedy (Phonetic.) Letter and those letters were, I 23 think, vintage mid-'90s, '96-ish, and they were as far 24 as I can tell, letters to an individual stakeholder 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

30 who had written to express concerns about how the Code 1

was being implemented to the Commission.

2 Those letters do point to paragraph (g)(4) 3 as the "regulatory basis" for the idea that the Code 4

would apply during operation to some extent or 5

another. To me, it's hard to tell exactly what that 6

letter is saying in this area, but it does clearly 7

point to (g)(4). I think our point is, we don't see 8

any support in (g)(4) for that position, so that this 9

crosses that line from a reasonable interpretation of 10 a regulation to really creating a new requirement.

11 I know Darani is going to get into the 12 backfitting concerns and, I think, talk a little bit 13 about the natural consequences of that position and 14 backfitting space, but also some policy considerations 15 in backfitting space. I hope that at least hit your 16 question somewhat, Andrea.

17 MR. DiFRANCESCO: Stephanie?

18 MS. COFFIN: Yeah, I had a question and it 19 kinds of follows on what Ray was asking. You've been 20 operating these plants for decades now, so can you 21 either now or maybe it's more appropriate later in 22 your presentation, describe for us what other methods 23 you have been applying for these Class 2 and Class 3 24 systems? That would sort of set up an example that 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

31 you have done non-Code, non-Section 11 evaluation, 1

have applied non-Section 11 methodologies and have 2

been, I guess, successful in those approaches.

3 MR. BASSO: Yeah and I think -- Jim, did 4

you come off mute?

5 MR. POLICKOSKI: Yeah, this is Jim 6

Polickoski from TVA. I think to your point, 7

Stephanie, I think it'd be worth letting us get to the 8

David Gullott section because I think Marty and him 9

will have some comments because it is a matter of 10 scope and what question each part of the Code was 11 answering.

12 There's a

scope difference between 13 evaluation and flaw characterization and repair within 14 the Code that is different than what we owe in 15 operability of a system meeting its safety function.

16 There's huge Venn diagram overlap, but they're not 17 equal discussions from a regulatory standpoint or we 18 owe in other portions of the Code for our tech spec 19 operability.

20 I think David will really help with that 21 and I realize you're visualizing the practicality of 22 the question and we have a section on that. I think 23 it may be worth getting there because I think we can 24 also fill in some gaps of what has legitimately 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

32 happened because while there's a big overlap, they are 1

not the same discussion. I think it's worth it.

2 I'll leave it to my colleague if there's 3

another thought there, but I'd recommend maybe we get 4

to that section and then that will probably scratch 5

most of it and then we can get the last 10 percent in 6

questions maybe. (Simultaneous speaking.)

7 MS. COFFIN: That's fine. Thank you.

8 MR. LAMOND: Yeah, thanks, Tom. I just 9

was going to go back to Andrea's first question about 10 the reading, the interpretation, the meaning of 11 50.55(a)(g)(4). We didn't put it in the slides, but 12 there are some paragraphs under (g)(4), Roman 13 numerals, starting with little Roman numeral I, but in 14 my mind what the base paragraph of (g)(4) is saying, 15 a licensee and owner has to have an inservice 16 inspection, an ISI program, maintain it throughout the 17 license and there are specific requirements for the 18 first interval, an interval being defined as 120 19 months, so 10 years.

20 Prior to your first 10 years of 21 operations, you have to build and develop an ISI 22 program and that has to be done in accordance with the 23 Section 11 addition that's endorsed in 50.55(a). It 24 used to be 12 months prior to the interval, now the 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

33 latest regulation is 18 months prior to the interval.

1 Then when you go to the little Roman 2

numeral ii, that speaks at the and addition and 3

addenda throughout the service life of the plant. So 4

every 120-month interval, now an owner has to go and 5

update their inservice inspection program to the 6

latest edition and addenda that's incorporated into 7

50.55(a) 12 months or now 18 months prior to the start 8

of that new inspection period. In my mind, that's 9

what (g)(4) and (g)(4)(I) and (ii) tell you.

10 MR. BASSO: Okay. Andrea, did you have 11 another question? I know your hand's up.

12 MS. KOCK: Yeah, so thanks for that and I 13 think I now understand the difference in the way you 14 are interpreting this versus the way the staff is 15 interpreting it. And, again, you just said you're 16 interpreting it to mean that throughout a service 17 life, a licensee has to maintain a program for 18 inspection and then in accordance with the Code.

19 I think the staff is interpreting that 20 differently, but then I'll just share my thought I 21 already shared, which is in areas like that where you 22 look at the regulatory language, you have to go deeper 23 into other Commission documents that point to our 24 interpretation and that's why those are really 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

34 important here. So, we already talked about that and 1

we don't need to talk about it further.

2 Just a follow up question is, so you 3

mentioned this is not a new issue. It's been going on 4

for years and some of the letters and guidance that 5

are pointed to on the RIS are back from the '90s. The 6

other really important part of backfit is whether 7

there's a change in our interpretation, that's what a 8

backfit is. What is the industry's perspective on 9

whether there's been a change here in the way the 10 staff is interpreting this regulation through, again 11 the regulation, but the guidance and our inspection 12 findings? And what's in our inspection procedures, so 13 practically speaking, has there been a change in the 14 staff's interpretation in terms of how we're 15 practically applying it through inspection and our 16 communication with the industry?

17 MR. BASSO: So, I think we're about to get 18 into the backfitting section of this, but I'll reply 19 and then I'll turn it over to Darani, because she may 20 want to start her section because I think it'll 21 address some of your questions, Andrea, about the 22 backfitting portion of this.

23 I think there's two causal pieces to the 24 backfit definition. One is a newer amended 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

35 requirement that causes a change to an SSC or a 1

procedure or method or a procedure required to operate 2

the plant. And the other is a newer different 3

interpretation (Telephonic interference.)

I 4

understand that you look at the history of how things 5

have been interpreted in the past, but those 6

interpretations need to be based on firm regulatory 7

footing. I think what we're saying here is we don't 8

see that basic underlying requirement, so this is in 9

effect a new requirement and that can't be cured 10 through statements in letters to individuals or in 11 generic letters or in guidance. That's kind of the 12 foundational position.

13 I don't think there's any way around the 14 fact that this issue does have a long history and 15 there have been various statements made about issues 16 associated with repair and replacement, which we think 17 are distinct from operability determination. So to 18 the extent that I think some of the more recent 19 documents, like I mentioned 0326, do attempt to 20 address this more directly, but I think our core 21 position is really that this is effectively a new 22 requirement. And, that if there was an interpretation 23 that points to (g)(4), that that interpretation is 24 substantively invalid because (g)(4) just simply 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

36 doesn't say what the interpretation says it says, but 1

I'll stop, oh, I think we have another -- that 2

prompted some more hands. I think Dan has his hand up 3

(Simultaneous speaking.)

4 MR. LAMOND: Well, I think Dave and Marty 5

will address some of that question. Dave?

6 MR. GULLOTT: Well, yeah, the only thing 7

I wanted to point out, Andrea, I do agree that your 8

comment on looking at the scope of all the 9

correspondence or different levels of guidance or NRC 10 position is important. In our letter of March 15th, 11 we talk about the statements consideration for (g)(4) 12 as part of how this supports our interpretation of 13 what (g)(4)'s intent was.

14 Also, a couple of a slides earlier, this 15 question has been going on for a long time and that's 16 why in around 2006 to 2015, it was back and forth with 17 the NRC. In 2015, the NRC concluded the last 18 highlighted sentence there is that after all these 19 activities, trying to address this question, that the 20 NRC needed to evaluate additional regulatory 21 activities to address operational leakage. So it was 22 not clear.

23 That's part of our -- even though it's 24 been going on for a long time and there's, in some 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

37 venues, an NRC stated position, it hasn't been 1

consistent and it's been challenged on several areas.

2 I don't think it's ever gotten to the backfit 3

discussion although maybe it should have at the time.

4 MR. BASSO: Ray has a question.

5 MR. LORSON: Yes, it was just basically in 6

hearing about the history and certainly I've been 7

familiar with various issues related to this question 8

on how to deal with operational leakage for a long 9

period of time, and, you know, Andrea mentioned about 10 not necessarily introducing new practices with this.

11 I think what I'm hearing is your real concern is that 12 you believe that the practices as described in the RIS 13 deviate from 50.55(a), the one section you're 14 pertaining to, not necessarily what's been kind of the 15 practice and also what's been articulated through 16 various products, such as letters and generic letters 17 and things like that.

18 But my question was, if there was any 19 previous assertion of backfit, like this issue has 20 been going on for 30 or 40 years, why wait until now 21 to raise a backfit issue? What's new and different 22 with the RIS that wasn't previously, you know, 23 discussed?

24 MR. BONANNO: That's a good question, Ray.

25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

38 From my perspective and others can chime in on this, 1

I mean I think the RIS hits this issue more directly 2

in a generic vehicle than any of the other documents 3

that have been cited.

4 Like I said, so I think in a sense this 5

RIS -- and the proposal to include this in the 6

previous rule making on the 10-year update, I think 7

brought this to a head in my view in a generic way 8

that just some of these other issuances haven't. So 9

I think that's one reason that you're seeing the 10 response now, but I'll also make another point.

11 This is maybe just a personal opinion or 12 a pet peeve, but I think from our perspective too, I 13 understand the question. I think it's a fair 14 question, but it's really the staff's responsibility 15 to comply with the backfit rule and we certainly take 16 seriously the idea that we should be pushing back when 17 we see things and bringing them to the attention of 18 the agency.

19 So I don't know why this hasn't been 20 addressed on the NRC side until now, but I think the 21 reason that you're seeing the level of kind of 22 attention to this now is because of the tools that are 23 being used, first the proposed rule making and then 24 the RIS and the generic impacts of that. But, I'll 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

39 pause there and see if anybody else has anything to 1

add on that.

2 MR. BASSO: Go ahead, Ray.

3 MR. LORSON: Yeah, no I just had a 4

question about the slide you're about to get into, but 5

I should probably let you go through it (Simultaneous 6

speaking.), yeah go ahead.

7 MR. BASSO: Yeah, Ray, I think this time, 8

let's have Darani go through this from a backfit 9

perspective. I will tell you that we did bring up and 10 challenge it on backfit when it was proposed as a 11 condition. So, Darani, why don't you go through and 12 provide our position on backfit.

13 MS. REDDICK: Yep, sure, thank you, Tom.

14 Good morning. Just have a few slides here to kind of 15 tie back everything that Jerry said into the 16 backfitting framework specifically.

17 So on this slide, we'll just talk about 18 why we believe that the Draft RIS does constitute a 19 backfit under the 5109 definitions. So I like to 20 think of the definition of backfit as having two 21 elements to it, right? A cause and an effect. The 22 cause is that you are posing a new or amended 23 requirement and then the effect of that is that it 24 leads you to have to modify your facility or its 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

40 procedures. That's what we have here in our view.

1 Here the cause is that the position in the 2

Draft RIS that's being articulated is in effect a new 3

requirement and the effect is that we would have to 4

end up modifying our procedures on operability, on 5

functional evaluations, other things because of the 6

imposition of that new requirement. So, kind of at a 7

very high level we think that this squarely falls 8

within the definition of a backfit. Tom, do you want 9

to go to the next slide?

10 Okay, even aside from the rule itself, 11 which we think this squarely falls within, it also 12 falls within the NRC's guidance on backfitting, 13 particularly NUREG/BR-0058 contains specific 14 discussions about how to treat ASME Code provisions in 15 backfitting space. What the new reg says is 16 essentially that when the NRC is imposing a 17 requirement that is substantially different from the 18 existing requirement, and substantially different from 19 the Code, that that is considered a new requirement 20 and backfit analysis is appropriate.

21 Again, that's what we believe we have 22 here, that the Draft RIS is seeking to oppose a new 23 requirement that is not already in 50.55(a) and also, 24 as I think we've all agreed to, that it's not part of 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

41 the Code itself either. So that would constitute a 1

backfit and a backfit analysis would be appropriate.

2 Next slide.

3 And then, third, even if we don't agree on 4

the Draft RIS being a new requirement versus a 5

clarification of a requirement, we still think a 6

backfit analysis would be prudent as a matter of 7

policy. Again, we don't concede that, we do believe 8

that the Draft RIS is a new requirement, but even if 9

you agreed, you said no, it really is just clarifying 10 an existing requirement, that means that the 11 underlying requirement that it's clarifying, was 12 imposed at some point in the past.

13 Whenever that was imposed in the past, 14 should have been accompanied with a backfit analysis.

15 We are not aware of any backfit analysis having ever 16 been done on this particular issue. So, we think that 17 regardless of whether you believe that this is a new 18 requirement or a clarification, as a matter of policy 19 and regulatory practice, it should undergo a backfit 20 analysis now. Next side, Tom.

21 Ray, you have a question?

22 MR. LORSON: I'll wait for you to finish 23 this conclusion section. Thanks.

24 MS. REDDICK: Okay, thanks. So just to 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

42 really summarize what Jerry and I have walked through, 1

our premise here is that the Code itself nor 50.55(a) 2 requires what the Draft RIS purports to clarify. We 3

think the plain language of 50.55(a)(g)(4) stands for 4

an entirely different proposition, meaning really 5

specific to the future additions of the Code, but it 6

does not stand for what the Draft RIS is trying to do 7

in terms of expanding the applicability of Section 11.

8 Therefore, issuing the Draft RIS would 9

effectively result in imposing a new requirement, 10 expanding the scope of Section 11 and doing that 11 imposing a new requirement has to be done in 12 conformance with the Administrative Procedure Act via 13 a Notice and Comment Rule Making, which was the path 14 that the staff was previously on when we had prior 15 interactions on this issue.

16 So in addition to being done through 17 Notice and Comment Rule Making, it would also have to 18 be accompanied and subject to a backfit analysis.

19 I'll just stop there and pause. I know, Ray, you have 20 a question, but others might have questions as well.

21 MR. LORSON: I would offer if anyone wants 22 to ask a question on this topic, go ahead, and I can 23 hold off. I've asked a lot of questions, but I do 24 have something I want to cover.

25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

43 I don't know if there were other hands up.

1 It doesn't sound like it, so I'll kick off, but you 2

talk about backfit as being a new or different 3

requirement and what I'm trying to understand, is it 4

the NEI's position that what's new and different is 5

just a difference in how we interpret 50.55(a) versus 6

how NEI might interpret 50.55(a)? Or, is the backfit 7

that the RES provides direction to do something beyond 8

which we've already established through the 40 years 9

or so of operational experience, multiple generic 10 letters and other communications on this topic. I'm 11 just trying to understand what's different from the 12 RIS? Is it a deviation from your interpretation of 13 50.55(a) or is it a deviation from the past and long 14 standing practice? I'm just trying to understand 15 where you see the difference.

16 MS. REDDICK: I'll let my colleagues here 17 jump in as well, but I think it's both. I don't think 18 we've ever interpreted 50.55(a) to expand the scope of 19 Section 11 and I think it's also not consistent with 20 our operational history, I'll say. Tom, I don't know 21 if you or Dave or others want to add to that, but I 22 think it's both, Ray.

23 MR. LORSON: Okay, so why is it not 24 consistent with the past 40 years of operational 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

44 experience? What specifically is different in the RIS 1

that's not something we've encountered previously?

2 MS. REDDICK: I think Dave will probably 3

get to this in his presentation some, but I think it's 4

just the limiting that you only have this one method 5

available to you when you're determining operability.

6 I think that's what's different. Jim, go ahead.

7 MR. POLICKOSKI: Yeah, this is Jim from 8

TVA. Ray, it does come down really to scope and the 9

Venn diagram. There is a defined Venn diagram that 10 Section 11 covers when it comes to the testing, 11 characterization evaluation and corrective action.

12 The Venn diagram for operability is much larger 13 because it traces to many other parts of our licensing 14 basis that also give us insight on how the SSC 15 maintains its safety function.

16 So it's a scope Venn diagram, if you can 17 deal with my analogy there, that is broader. We owe 18 execution of the safety function at a broader level 19 and have other tools at 326 and others that David will 20 get into, that allow us to from the presumption of 21 operability through all surveillance testing to show 22 that the safety function is maintained or not and then 23 we would actively and then we would act if it's not.

24 But the Code itself does not mean we've 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

45 lost the safety function and that's an important piece 1

that they're not hinged. They're connected, but 2

they're not, it's not a binary question, especially 3

when you are using the Code outside of its intent of 4

inspection, testing, evaluation, characterization and 5

repair. Hopefully that helped. David's discussion 6

will, I think, really walk us through that.

7 MR. LORSON: Okay, well maybe I can hold 8

off on the question, but what I'm struggling with is, 9

I get a hole in a pipe in a nuclear power plant before 10 I issue the RIS and I get a hole in a pipe after I 11 issue the RIS. The hole in the pipe already has got 12 four years of operational experience and guidance that 13 the NRC's issued on this topic that would address how 14 to deal with that degraded section of piping.

15 Now I issue the RIS, what's different in 16 terms of how it would be treated given the past 17 operational experience that we've had over the last 18 many, many years? What would we do differently going 19 forward that we weren't required to do differently 20 going back in time?

21 MR. POLICKOSKI: The punchline to that 22 honestly is I may have to maneuver, if I don't have an 23 existing approved alternative on top of what the 24 existing Code says, and I'm not allowed to use to the 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

46 other tools of assessing operability, then I would 1

have to maneuver my unit, potentially shut it down 2

and, you know, initiating an events frequency, there's 3

a lot of downstream negative safety impacts that that 4

can address. All potential, it's just system unique 5

and so that's a very real impact when we're actually 6

detracting from safety to the public.

7 MR. LORSON: But you're saying that 8

currently if you find this flaw through wall leak in 9

a Class 2 or Class 3 ASME Code system, you're saying 10 our current interpretation may not result in 11 maneuvering the plant to a shut down. I'm just trying 12 to understand differently --

13 MR. POLICKOSKI: Correct (Simultaneous 14 speaking.) I'll still fix it, but it may not impact 15 the safety function where I have to declare it 16 inoperable. We have to fix it and David will go into 17 that. I realize we're really getting ahead of David's 18 talk here. (Simultaneous speaking.)

19 MR. GULLOTT: And, Ray, I think, sorry, 20 Andrea, I didn't mean to, I know you had your hand up 21 first. But to try and answer your question, I mean 22 several of the questions have been what's changed in 23 the last 20 to 30 years? I think recently, in the 24 last several years, there's been a greater discussion 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

47 and emphasis and documentation on when you're 1

assessing operability using alternative methods and 2

I'll talk about alternative methods later, that are 3

not specifically endorsed by the NRC.

4 I think throughout the history of this, 5

some licensees have, at times, used alternative 6

methods and been fine and moved forward without any 7

compliance issues. In some instances, they've done 8

the same thing and there have been compliance issues.

9 Because other than, I think, the IMC 0326 and its 10 predecessor documents which was inspector guidance, 11 there was nothing really driving this question until 12 now.

13 We get to what was the potential rule 14 making last year that trying to codify this 15 requirement to use only approved methods and now the 16 RIS, which is specifying only approved methods. I 17 think prior to that, the guidance was nebulous and 18 people were doing it differently. Some people were 19 using, depending on the situation if there was an NRC 20 approved method, they were using it. If there wasn't, 21 they may have been declaring something operable based 22 on other parameters and that was considered okay.

23 So recently, now the NRC is really trying 24 to codify something that's been inconsistently applied 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

48 on both sides for the last 30 years.

1 MR. LORSON: Okay, well thank you. I 2

guess I'm just trying to understand the difference or 3

change and so I have to think about that a little bit.

4 Thanks.

5 MR. POLICKOSKI: Yeah and, Ray, the only 6

thing I'll add to what to David just said is 7

inconsistent probably on both sides of the aisle 8

between industry and the inspectors to be fair. But 9

now that it's going to get locked that's real 10 worrisome because operability is an important issue.

11 We start from the presumption of 12 operability and we have to surveillance testing, 13 everything that keeps you going. There's a lot of 14 tools that go into declaring a system operable 15 relative to its licensed safety function. That's the 16 parameter we want to make sure always gets held to 17 with operability, not necessarily the narrowness of 18 what the Code's purpose is.

19 MR. BASSO: So on the matter of time, 20 let's move on with the presentations and get to some 21 of the other points. So, Dan?

22 MR. LAMOND: Yeah, thanks, Tom. I'm going 23 to go ahead and kick off my portion which is really 24 just looking at the ASME side of the house and our 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

49 perspective on how Code applies on our rules.

1 Again, just for everyone who hasn't met 2

me, I currently work with GSE TrueNorth Consulting.

3 I've been doing engineering programs for my whole 4

career of 30 years, even going back to days on working 5

group pressure testing. One of our working groups 6

which specifically dealt with through wall leakage.

7 Stephanie, for a short period of time, was our rep on 8

that committee. Remember our time there? So, I've 9

been doing this for a while. My current positions 10 relative to this are one of two vice chairs for our 11 Section 11 Standards Committee and I'm the current 12 chair of our Executive Committee, which sets the 13 direction and deals with these types of issues for our 14 Code body.

15 Today I want to provide the perspective 16 and role that we feel that Section 11 places in this 17 and give a little history and I believe we've talked 18 about it a little bit so far. I'll try and fill in 19 some of those gaps on when we dealt with this in the 20 past, when it came to Code body.

21 Just to make sure everyone is clear, I 22 think we're all there at this point, but we're dealing 23 with the ASME Boiler and Pressure Vessel Code, BPV 24 Code, specifically the Section 11 Code Book, which is 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

50 rules for inservice inspection of nuclear power plan 1

components. We maintain this Code both through a 2

consensus body process.

It's a

multi-tiered 3

committee. We have task groups reporting up to 4

working groups reporting up to subgroups and 5

ultimately to our Standards Committee.

6 Our Standards Committee is chartered with 7

developing and maintaining and updating the Section 11 8

Code, supporting and publishing the addition and 9

addenda. Previously had addenda, we saw those words 10 in the 50.55(a)(g) paragraph now we're just issuing 11 additions on a two-year frequency. Our Standards 12 Committee reports up to the Board of Nuclear Codes and 13 Standards, the NCS organization.

14 Again, we touched on earlier, 50.55(a) is 15 the rule that requires licensees to comply with 16 Section 11 and in the latest 50.55(a) 2017 edition, is 17 what's endorsed or what's incorporated. We have a 18 proposed rule making that's coming out in June and 19 we'll revise that to the 2019 edition. All the 20 statements in my presentation here coming up, will be 21 supported by what's in the current approved edition, 22 the 2017 edition.

23 So, if you just look at Section 11 in 24 general, what's it do? You just look at the bold 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

51 items on the left. It defines the scope of your 1

program, tells you what you need to do for inspection, 2

different types of examinations and tests. When you 3

find something, it tells you how to evaluate it. When 4

you evaluate it, part of that is characterizing the 5

flaw that you find and then, ultimately, if you can't 6

except it, then you need to have the rules for the 7

repair replacement of the particular component.

8 You can see the bold underlined for scope, 9

evaluation and characterization. These are statements 10 right out of the Section 11 Code Book. So, it's 11 inservice inspections, it's during an inservice 12 examination, it's characterization processes for flaws 13 detected by the pre-service or inservice exams.

14 Just one acknowledgment, we touched on it, 15 Jerry said it earlier, the repair replacement portion 16 of our rules in Section 11, IWA 4000, that's the one 17 place in the Code Book where we do specify those rules 18 are required by the owner, by the licensee, any time 19 they're going to do a modification to a Code Class 20 component. So that's the one place where we do call 21 out this portion of the Code applies at all times.

22 For those aren't familiar with the repair replacement 23 process, there's lots of reasons that we could do 24 that. It could be anything from end of life to a flaw 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

52 to just a design change the plant's doing.

1 Okay, just another note here supporting 2

the background. I guess ASME's interpretations, we've 3

talked about the history. We have a process through 4

interpretations that any member of the public can 5

submit to the Committee. We can process those.

6 There's multiple types requirement or 7

intent interpretations.

The requirement 8

interpretations are the simplest part, the simplest 9

type of interpretation. What those are defined as, we 10 have to be able when we answer requirements 11 interpretation, to point to the words in our Code Book 12 that are currently published and approved to be able 13 to answer the question that's being submitted by the 14 member of the public.

15 That's germane to this slide because the 16 bottom three bullets there are three interpretations 17 that touch on this topic that have been published over 18 history. Actually, they date a little far back, 19 anywhere from early '90s to late '90s and they all 20 concluded the same. The questions were asked with 21 different topics in the Code Book, but ultimately 22 these different topics or requirements apply when 23 they're discovered in some portion of time that's 24 other than a Section 11 required examination or test.

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53 The Code Committee has always come back 1

and said they did not apply. The one most specific to 2

this topic is the last bullet on this slide, specific 3

to the evaluation and corrective measures portions of 4

our Code that say those do not apply other than when 5

we're doing a Section 11 examination or test. So, if 6

an operator is just out walking around the plant and 7

discovers a leak, you can use the Code Book as an 8

option as an owner, but there are other vehicles that 9

may be used to resolve that condition. Okay, next 10 slide, Tom.

11 So this is the slide that touches on the 12 history of when this has come up before. In 2006, the 13 ASME Code Body received a letter asking the Committee 14 what does Section 11 currently require, how does it 15 view it's scope, it's role, it's jurisdiction relative 16 to conditions discovered outside of a Section 11 say 17 pressure test, operational leakage, some leakage 18 that's discovered during normal plant operation.

19 In 2008, we had developed a test made up 20 of multiple working groups. This topic cuts a couple 21 different portions of our Code. Throughout that time, 22 from 2008 until 2014, we tackled this issue in 23 multiple phases. We acknowledged up front that we had 24 at that point in time, back in 2006-2008, had detailed 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

54 rules for Class 1 leakage. Class 2 and 3 had some 1

rules, but a lot of those just pointing back to Class 2

1.

3 The first thing we wanted to do is let's 4

close up and specify what should be the appropriate 5

requirements within the Code for addressing Class 2 6

and 3 conditions and we did that as part of this 7

activity.

8 Also, in parallel, we published a couple 9

of Code cases, which would allow temporary acceptance 10 of conditions until a time when you could do repair 11 replacement and parallel with those Code cases, we 12 actually put those into the Code Book themselves in 13 the form of a non-mandatory appendice. So that's what 14 the Code did as part of this.

15 In the end, we got to really the germane 16 topic of the item, called it Phase Three and said 17 okay, now that we have the Code requirements all 18 tightened up, including some of these alternatives 19 through Code cases and then the non-mandatory, what do 20 we think our jurisdiction should do relative to 21 operational leakage.

22 The Standards Committee and Executive 23 Committee debated that topic for a while and 24 ultimately said we need to maintain the technical 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

55 rules of the Code Book on how you do inspections and 1

tests, how you evaluate conditions and how you resolve 2

them, but it's outside really the jurisdiction of the 3

Code Committee to define when Section 11 should apply 4

or shouldn't apply. Ultimately, in the end, we did 5

not change the scope of the Code Book.

6 We did write a letter back to the staff at 7

that point defining or summarizing all the activities 8

we've done over this time period and ultimately 9

stating that the scope of the book would not be 10 changed, specifically within Section 11 text.

11 Then the letter that Jerry presented the 12 excerpt from earlier, was the final letter at this 13 point in time, back to the ASME Committee saying thank 14 you, okay, the staff will take that into consideration 15 and have to make a determination if we feel any 16 additional requirements would be necessary. So that 17 kind of ties up the history.

18 Just shifting to operability, a few more 19 topics from Section 11 perspective and then I'll let 20 the next portion of the presentation dive into 21 details. When we address items, whether it be a Code 22 change or Code case or interpretations within our Code 23 Committee bodies, we're clear throughout our debates 24 and discussions that we're not doing operability 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

56 determinations. We're a structural integrity code.

1 We're interested in pressure boundary and 2

while Section 11 may be one piece that goes into an 3

operability determination, there are many 4

considerations that an owner has to do really to 5

ultimately determine is the component, is the system 6

operable. We've maintained that in our focus in our 7

operating procedures.

8 We also have a users' guide, it's called 9

"A Code Companion Guide" and there's just one 10 statement I pulled from there. This is a guide that 11 many of the licensees will lean on for how they 12 implement the Code. There's just a quote there it 13 basically says what we've articulated a few times that 14 the reference interpretations include several examples 15 Section 11 does not provide requirements for the 16 evaluation acceptance of flaws identified by means 17 other than a required inservice inspection or 18 examination, meaning a Section 11 required activity.

19 Those reference interpretations are the three that I 20 had back around slide 17.

21 Then just three bullets of conclusion.

22 Ultimately, in the first bullet, we've maintained just 23 from ASME's scope and jurisdiction that the Code 24 applies for Section 11 required activities, plain and 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

57 simple.

1 Any expansion that requires the use of 2

Section 11 to other times, other activities at the 3

plant, whether that be plant operation or maintenance 4

walk downs, would be expanding at least the scope as 5

it's written within the ASME Codes and Standards 6

books. The change that was originally proposed as 7

50.55(a)(g)(4)(4)

revision, is now a

similar 8

methodology and the Draft RIS would do that expansion 9

of applicability from what's maintained within the 10 Section 11 Code Book itself.

11 So that's short and simple. I think 12 that's the easiest part of this for folks to grasp, 13 but that's been ASME's Section 11 role throughout 14 history. Any questions on those slides? Yes, thanks, 15 Tom.

16 MS. COFFIN: I don't see any questions.

17 Thanks very much.

18 MR. LAMOND: Yeah, thanks, Stephanie. I 19 don't see any hands.

20 MS. COFFIN: Oh, now there's a hand of 21 course. (Simultaneous speaking.)

22 MR. LAMOND: Okay.

23 MR. LEWIS: Sorry, just slow to click. I 24 want to circle back to Ray's question and I think the 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

58 slide right before this slide is kind of what made me 1

think of it. I'm not entirely sure this is the right 2

point to ask, but Ray's question, what will be 3

different going forward, if and when the RIS is issued 4

compared to the past? I thought the answer was in the 5

past, we had more options for operability 6

determinations and, per the RIS, the RIS says the only 7

well, I don't have the exact language, excuse me.

8 The RIS says the only approved method is 9

the Section 11. And Andrea asked a similar question, 10 but I guess my question would be if the RIS didn't say 11 the only approved method, would you still have backfit 12 concerns or is it just that one sentence in the RIS or 13 is there something broader in the RIS that you're 14 saying doesn't reflect past practice?

15 MR. LAMOND: Yeah, that's a good question.

16 I guess I'd defer to maybe Jerry or Dave to provide 17 your opinions on that.

18 MR. BONANNO: Yeah, I mean I think it's a 19 good question and I think the core issue for us, Rob, 20 is this idea that these are the exclusive methods for 21 doing your operability determination. That's really 22 the rub for us is this idea that there's now explicit 23 statements in the RIS, you know, taking the same 24 position that was taken in the previous rule making 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

59 that this is it when you're doing an operability 1

determination on Class 2 and 3 components. I think 2

that would (Simultaneous speaking.), yeah, go ahead, 3

Dave.

4 MR. GULLOTT: No, I was just going to say, 5

yes, I would say and I'd have to give it some more 6

thought because there are a couple of issues. I think 7

after we get through the next section maybe it'll be 8

a little more clear, but yes, if the NRC's 9

interpretation of 50.55(g) was what it is currently, 10 but for whatever reason licensees were not obligated 11 to use only approved methods and if one didn't exist, 12 they had the opportunity to use other methods for 13 operability. I'll get into the details of this in a 14 minute.

15 I don't think it would have such an impact 16 on the industry if we weren't restricted to only 17 approved methods and might not have as much of a 18 concern. There might be some interpretation concerns 19 and stuff of that nature, but I don't think how we 20 operate the plants would be impacted as much.

21 MR. LAMOND: Hey, Dave, I think the 22 easiest thing to get your head around and I'll speak 23 from ASME Code perspective again to this, is that when 24 you think about the evaluation process and the 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

60 characterization process, ASME Section 11 defines the 1

majority of the plant configurations, but not all.

2 There are configurations out there in 3

certain systems that we don't have evaluation criteria 4

to find in our IWA 3000 rules and that's the biggest 5

struggle, I think, owners and licensees find 6

themselves in, what do I do when I find a relevant 7

condition in one of those configurations and the Code 8

doesn't tell me how to do it. Well, there's certainly 9

analytical evaluation techniques and methods I could 10 use, they're just not documented within the Code Book 11 itself. To me those are the easiest situations, so 12 okay what have we been doing? The owners have been 13 doing analytical evaluations to accept those, just not 14 in accordance with the Code. (Simultaneous speaking.)

15 MR. GULLOTT: Hey, Ray?

16 MS. COFFIN: Ray, I think you had a 17 question.

18 MR. LORSON: I think I may have just heard 19 a response just a moment ago, which is I'm trying to 20 understand the difference again with the issuance of 21 the RIS and I think what you're saying is right now if 22 you find a leak in a nuclear plant, Class 2, Class 3 23 pipe, that is not covered by an existing Code case, 24 that right now you would use some other method to 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

61 evaluate the flaw. That's what you're currently doing 1

and your belief and understanding is that you can do 2

that without requiring any separate interaction with 3

the NRC, not a relief request or something of that 4

nature.

5 Whereas if the RIS were issued in its 6

current form, your view is that somehow your ability 7

to treat that leak would change. So, I was just 8

trying to understand how it would change. I guess 9

your view is that you would be prohibited from using 10 an alternative method or you'd have to seek some type 11 of relief from use of the alternate method? Again, 12 I'm just trying to understand what would be the delta?

13 MR. GULLOTT: Ray, I think you've 14 characterized the delta. The current RIS' position 15 would be that if we identified operational leakage 16 that was not a configuration or something that did not 17 have an applicable, approved method to evaluate, then 18 we don't have an ability to evaluate it for 19 operability.

20 We would have to seek NRC approval and 21 until that point in time, it's inoperable. I think if 22 we go to my slides, we'll kind of walk through that in 23 a little more detail and we could maybe revisit your 24 question.

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62 MR. LORSON: Okay and I think Stephanie 1

had her hand up. (Simultaneous speaking.) I will just 2

offer that I think we've approved and have reviewed 3

and disposition numerous relief requests in the past 4

in cases where leakage did not fall into a particular 5

Code case. I don't know that the RIS introduces a new 6

practice, but I understand your point that you believe 7

that it introduces a deviation from how part 50.55(a) 8 has worded it.

9 MR. GULLOTT: Yes.

10 MR. BONANNO: Ray, it makes an assumption 11 that the Code does cover all these cases from a 12 practicality and then the reality is because of all 13 the different ways issues can show themselves, leakage 14 wise, it does not provide the necessary information to 15 help us determine operability. It really does tie our 16 hands unnecessarily and it can have a negative impact 17 the same.

18 MR. LORSON: I'm not sure about the 19 negative impact, that I can't quite grasp, but I do 20 think what you're saying is that the RIS, it sounds 21 like one of the big concerns is that there are 22 examples of leaks that can occur that are not covered 23 by an existing Code case and that in and of itself is 24 restrictive in your ability to evaluate those types of 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

63 blocks. (Simultaneous speaking.)

1 MR. POLICKOSKI: What I don't want to do 2

is, I mean, an unnecessary movement in my unit 3

transient is a negative safety impact that was not 4

necessary, so I want to make sure I don't let that 5

comment go unchecked because an unnecessary movement 6

of the unit does impact initiating events frequency 7

and a lot of other aspects so (Simultaneous speaking.)

8 MS. COFFIN: Folks, please be careful 9

about talking over each other for our court reporter.

10 Raising hands really helps keep us organized.

11 MR. POLICKOSKI: Yes, ma'am.

12 MS. COFFIN: Okay, so I'm just going to 13 kind of repeat my question and then what I heard Ray 14 and Rob ask. I'll just repeat it because I think it's 15 really, really important for the CRGR to understand 16 what is new and different. It sounds to me like in 17 the past 40-50 years, you have done operability 18 evaluations and have done evaluations that weren't 19 sanctioned or developed through the Code and that 20 those have been successful and NRC has presumably 21 reviewed those and you haven't had to come in for a 22 relief request to implement those in the past. That's 23 what I think I'm hearing. So really understanding 24 what is new and different, I'm just repeating what 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

64 some of my colleagues have said is that's a really, 1

really important input for the CRGR to hear.

2 MR. BASSO: In general, that's a correct 3

statement, Stephanie. Andrea?

4 MS. KOCK: Hi, my mute button's a little 5

bit slow. So I have a question, but also just a 6

follow up on what Stephanie said. I mean I 7

interpreted the conversation a little bit differently, 8

so maybe we want to just spend a minute on that.

9 What I heard is that in the past, you have 10 used different methods to evaluate leakage. Okay.

11 But I also heard just because you have evaluated using 12 a different method and you haven't been cited by the 13 NRC, our interpretation is that that's okay. It means 14 it may not have been inspected or inspectors don't 15 look at everything, so I also heard there's 16 inconsistency. In some cases, use those different 17 methods and there's been no citations and in other 18 cases, there has been.

19 I actually interpreted the conversation a 20 little bit differently. So just because you've done 21 something in the past, doesn't necessarily mean that 22 the NRC interprets what you've done to be correct 23 according to our regulations, because we don't look at 24 everything that you do at a plant. So I actually 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

65 heard it a little bit differently.

1 My question, though, is I think you also 2

touched on a really important point just now in terms 3

of there are situations where you may have detected an 4

issue and there's a condition that exists that's not 5

covered by the Code. So my question is, is there a 6

change in the NRC's interpretation in your mind in 7

those cases? What I mean by that is in the past when 8

you've identified conditions that are not covered by 9

the Code, do you have information from the NRC that we 10 previously interpreted that well if it's not covered 11 by the Code, you can use whatever methods you want.

12 You don't need to come in for a relief request and now 13 we're changing our position. Because that's a nuance 14 also that I think is very important. We keep going 15 back to this issue of is there a change because it's 16 very, very critical for us, that's a critical part of 17 backfit.

18 So, I have a question about whether the 19 industry sees a change in the NRC's position with 20 regard to these cases that might come up where the 21 Code doesn't address the condition. Have we squarely 22 said in the past, it's fine in those cases if the Code 23 doesn't address it to use alternative methods and 24 we've taken a position that that's okay and now we're 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

66 changing? What information exists to indicate there's 1

a change with regard to that situation?

2 MR. BASSO: Dave?

3 MR. GULLOTT: Yeah, Andrea, at a higher 4

level I think yes, the NRC has changed the position 5

and I'm going to cover this. We're talking about 6

operability, okay, and in general operability not just 7

operability of ASME Code Class 2 or 3 operational 8

leakage, but operability. The NRC has historically, 9

when evaluating operability, allowed licensees and 10 it's documented, it's been documented in IMC 0326 for 11 many years and in its predecessors, to use alternative 12 methods; those could be methods that are not part of 13 your licensing basis to evaluate operability, to 14 evaluate whether the component can perform its 15 specified safety function for tech specs. That's been 16 the case.

17

Now, this position that is being 18 articulated in the RIS is that that's not true for 19 ASME Code operational leakage and there's no place in 20 the history when talking about operability that we've 21 identified where the NRC has clearly documented that 22 when looking at operability we have this position and 23 use of alternative methods and except with Code Class 24 2 and 3 piping.

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67 If we can go to my slides. I'm going to 1

try and walk through this a little bit more logically.

2 Probably get a little more in depth, but also present 3

some distinctions as we see them and hopefully it'll 4

answer a couple of questions. I'm sure it's going to 5

raise a few more questions.

6 So, as we've heard, are we on slide 22?

7 Yeah. You know, we've heard in earlier discussion the 8

RIS says it's intent is to clarify the requirements of 9

operational leakage and how operability of a leaking 10 SSC is determined.

11 Specifically stating and the way we read 12 it is, operational leakage must be evaluated for 13 operability and only approved methods can be used in 14 this evaluation. Jerry said it earlier, but we agree 15 that when operational leakage is identified, 16 operability must be evaluated. We don't agree that 17 there's any regulatory requirement limiting this 18 evaluation to only approved ASME Code methods.

19 I want to talk about what is operability 20 and how is it assessed within the plant's licensing 21 basis and NRC guidance. Most everybody knows that 22 tech specs are required by 10 CFR 50.36 and although 23 not discussed in the CFR, operability is a defined 24 term within the tech specs and it's only applicable to 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

68 the tech specs. There's no other regulatory vehicle 1

or process that really defines or addresses the tech 2

spec operability.

3 So when a deficient condition, and this 4

could be any deficient condition, including 5

operational leakage, when a deficient condition is 6

identified in a tech specifically SSC, licensees are 7

obligated to determine if the SSC can still perform 8

the tech specs specified safety function with the 9

deficient condition. If the deficient condition does 10 not prevent the SSC from performing its specified 11 safety function, then the SSC remains operable even 12 though the deficient condition exists.

13

Now, operability and operability 14 assessment that's a licensee process. It's a licensee 15 decision and once an SSC is considered operable, it 16 remains operable absent any contrary information.

17 This is what we call and the NRC and IMC 0326 also 18 call the presumption of operability.

19 Operability is a continuous process in 20 that as new information is developed, say the 21 identification of operational leakage, as the new 22 information is developed, the impact on operability 23 must be assessed. The key to the operability 24 determination and the discussion that we have been 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

69 having is that alternative methods, and I'll go into 1

those in a few slides, may be used to assess 2

operability.

3 One thing I'll note is that the 4

operability determination doesn't change the licensing 5

basis for the plant. It's really just an assessment 6

of the impact of the deficient condition on the safety 7

function and it's not a permanent plant change. I'll 8

also note that the NRC evaluates licensees' 9

operability process and the specific operability 10 determinations they do through their inspection 11 program. Tom, we'll go to the next slide.

12 What gets confused or conflated sometimes 13 is the concept of operability versus the concept of 14 corrective action. Both of these are defined 15 regulatory processes and both are required to be 16 followed if we identify operational leakage, but they 17 are distinct and they are separate processes with the 18 separate purposes in the guiding principles.

19 As I said earlier, operability assesses 20 the SSC with the deficient condition to determine if 21 it can perform it's safety function and there's a 22 process for doing this. And separately, licensees are 23 required to correct the deficient condition and 24 restore the SSC to an acceptable condition that is 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

70 compliance with the licensing basis. We have to do 1

that regardless of whether operability is impacted by 2

the deficient condition, whether there's a component 3

with a deficient condition and it's operable, we still 4

have to correct it. If there's a deficient condition 5

that causes the component to be inoperable, we still 6

have to correct it.

7 Now, the Corrective Action Program, that's 8

driven by Appendix B of Part 50 and that's, as I said, 9

the process used to fix the deficient or the degraded 10 condition. Obviously, corrective actions are required 11 when operational leakage is identified, no matter how 12 it's identified, whether it's from a Code required 13 exam or an operator walking down the plant and 14 identifies leakage. Regardless, it needs to be 15 corrected and that's done through the Corrective 16 Action Program. Also, any corrective action must 17 comply with the licensing basis.

18 So for any operational leakage, how the 19 licensee fixes it has to be in accordance with 20 50.55(a) and ASME requirements and if a licensee does 21 want to fix an SSC outside of those requirements, then 22 they must get prior approval. They must get a relief 23 request if we're dealing with Code stuff. If it's 24 some other licensing basis issue that's effecting 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

71 operability, it could be a license amendment or a tech 1

spec change, but if we're going to take a corrective 2

action that is outside the licensing basis, NRC 3

approval is required. Like I said, just like 4

operability, Corrective Action Program is also 5

assessed by NRC inspection.

6 So what I really want to just clarify and 7

make sure that there's the distinction is when we're 8

talking about operability, it's an assessment of the 9

ability to perform tech spec safety function with the 10 existence of the deficient condition. The corrective 11 action is the process to fix the deficient condition 12 and restore compliance with the license basis. Tom, 13 next slide.

14 So, how does this position in the RIS, how 15 does it impact us? On the right hand side of the 16 slide, there's two quotes, both from the Draft RIS.

17 The first one says that when operational leakage is 18 identified, 50.55(a)(g) methods must be used. The 19 second one points to the requirement to obtain NRC 20 approval via relief request to use alternative codes 21 or standards.

22 Now, fundamentally, we don't have a 23 problem with these statements, if they were referring 24 to the requirements for corrective action. That is 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

72 where there's an approved method, it must be used to 1

fix operational leakage and to ensure compliance with 2

the licensing basis. If there isn't one, we have to 3

get NRC approval before fixing it to restore Code 4

compliance, but the Draft RIS, the position it's 5

taking is not referring to corrective action. It's 6

referring to operability assessments and that's where 7

we disagree with the RIS position that operability 8

must be assessed using only approved methods. So, you 9

know, the impact first limiting licensees to only 10 approved methods does not address all conditions, 11 configurations, components that can exhibit 12 operational leakage and we've mentioned that.

13 Thus, with the limiting RIS position, if 14 there's not an approved method, then the SSC must be 15 declared immediately inoperable no matter what other 16 evaluation can show a safety function can be met. The 17 second, as I stated a little earlier, the prohibition 18 of using alternative methods for an operability 19 assessment, that contradicts the NRC position it 20 clearly stated in the IMC 0326 on operability.

21 I won't go into a lot of detail, but slide 22 29 is a backup slide that provides a little bit more 23 discussion on the NRC's position on use of alternative 24 methods and operability assessments, but this NRC 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

73 position is that when performing operability 1

determinations, licensees may use alternative methods 2

that are different than those originally used in 3

either the plant design or the plant licensing.

4 It's recognized that these alternative 5

methods must be technically appropriate and they must 6

be defendable for the deficient condition being 7

evaluated.

The RIS is stating, and it's stating this 8

as a regulatory requirement, that only approved 9

methods are allowed to be used when evaluating 10 operability. As previously discussed, we have found 11 there is no regulatory requirement supporting that 12 position. The position contradicts the NRC's own 13 guidance on use of alternative methods in tech spec 14 operability assessments. (Simultaneous speaking.)

15 MR. BASSO: Ray, you had your hand up?

16 MR. GULLOTT: Ray?

17 MR. LORSON: Yes, thanks. No, just on 18 this particular slide, the second bullet is kind of 19 highlighted, it talks about alternatives to codes and 20 standards that are met and that require approval to 21 ensure that the appropriate method of evaluation has 22 been performed.

23 You know earlier there was some discussion 24 about safety and I think safety also implies that 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

74 you've properly evaluated degraded conditions to 1

ensure that your safety related components can perform 2

the intended safety function. I think that's an 3

important part of safety and the operation of the 4

plant. But the actual question relates back to this 5

whole concept of what I keep hearing is that there are 6

times when there are degraded conditions that exist 7

that you don't have a prior Code case for. Would it 8

be the position of NEI and Industry that if a Code 9

case exists, that that ought to be the preferred 10 method of evaluation? You know, the evaluation of 11 choice.

12 MR. GULLOTT: I would say yes, that's the 13 position that we've taken at Constellation. That if 14 there is an approved method, then we should move 15 forward with that.

16 MR. LORSON: Okay.

17 MR.

GULLOTT:

You shouldn't guess 18 (Simultaneous speaking.)

19 MR. MURPHY: Hey, Ray, (Simultaneous 20 speaking.) This is Marty Murphy with Xcel. So I think 21 you said preferred method and I think we would agree 22 with that as well at Xcel that if there's a Code case 23 that would be the most desirable way to address the 24 issue.

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75 MR. LORSON: Okay. So, then if I look to 1

the second bullet, what it sounds like is the real 2

concern is that the need to come to the NRC to see 3

approval to use an alternative method.

4 Is that your real concern as opposed to 5

just making the, you know, evaluating the flaw using 6

the alternate method and then expecting the NRC or 7

asking the NRC if we have a concern with that to 8

identify it through kind of inspection and enforcement 9

space, as opposed to making the evaluation using an 10 alternate method and seeking approval. It's really 11 just whether you seek approval or not, that's what is 12 different in your view. I'm just trying to understand 13 your concern. (Simultaneous speaking.)

14 MR. GULLOTT: I think you've boiled it 15 down to yes if there's not an approved method 16 available, that we can't use, but there are 17 technically sound allowances, just like that's allowed 18 for the operability guidance, we should be able to use 19 those without prior NRC approval to assess 20 operability. Corrective actions, as I said, is 21 another story. But that evaluation is still subject 22 to inspection obviously.

23 MR. POLICKOSKI: Yeah, and this is Jim 24 from TVA. I think, Ray, what also would help is, and 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

76 I think it's important to separate the operability 1

determination side from corrective action.

2 If the Code does not provide us good 3

information on the repair without a doubt, you know, 4

that's something we would work to address the 5

alternative in that regard in terms of corrective 6

action space. But an operability determination, we 7

may not necessarily need an alternative because the 8

scope of the leakage may have very, almost minuscule, 9

impact on the safety function and that's not 10 necessarily a Code alternative decision. It's an all 11 the other information and our licensing and design 12 basis that informs us of what that SSC does to solve 13 the safety function. So it may not be exclusive to a 14 Code discussion on the ability of that system to 15 executive its safety function.

16 I want to make sure it's not, they've 17 overlapped surely from a Venn diagram viewpoint, but 18 it's not exclusive that the Code itself will only 19 inform us of whether it meets its safety function.

20 MR. LORSON: No, I think the question 21 really pertained to if there's Code alternative, would 22 you prefer to use the Code if you request an 23 alternative it seems to me the real crux of the 24 concern boils down to, and I'm trying to understand 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

77 the concern, is that if you were using alternative 1

method, would it require NRC approval as opposed to 2

not requiring NRC approval to use an alternative 3

approach. Is that the real crux of the concern?

4 That's all I was trying to establish.

5 MR. POLICKOSKI: Ray, is the scope of your 6

question corrective action or operability? Just to 7

make sure I understand the scope of your question.

8 MR. LORSON: I would say operability.

9 MR. POLICKOSKI: I would say asking that 10 binary question really is not capturing our concern 11 because the --

12 MR. LORSON: Okay.

13 MR. POLICKOSKI: Code, there may not be an 14 alternative that we would request that is applicable 15 when we understand better the impact of the safety 16 function. You know, whether it's flow rates, water 17 volumes. The Code may not provide information that 18 tells us the safety function has not been impacted.

19 So that's why I'm trying to make sure that we separate 20 the two.

21 The Code can inform us, but it may not be 22 the only tool and an alternative the only tool to 23 assessing operability. For example, if the Code 24 didn't cover us, in that case we may not need an 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

78 alternative because another approach would solve the 1

ability to assess operability, unrelated to the Code.

2 MR. LORSON: Okay, so then, again, I'm 3

trying to understand the concern. I guess it sounds 4

like you have two concerns, one is the alternative may 5

not be something you could seek relief for or the 6

alternative may require you to seek relief for. In 7

either case, the seeking of relief is what really kind 8

of imposes the burden in your view.

9 MR. POLICKOSKI: That better captures it 10 because it could be a Code alternative request or it 11 could be a method or approach that has nothing to do 12 with the Code.

13 MR. LORSON: Just one other question for 14 clarification. I heard a lot about when the Code 15 applies and when it doesn't apply and maybe this 16 should have been asked in the preceding section, but 17 it sounds like the interpretation of the Code is that 18 it applies throughout the service life of the nuclear 19 power plant, except for the times that the plant's 20 actually operating.

Is that the correct 21 interpretation of the position you're making?

22 MR. BASSO: Jerry?

23 MR. BONANNO: Yeah, no, I think the 24 interpretation of the Code is it's applicable to flaws 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

79 discovered during inservice examinations and testing.

1 It's kind of like those sections of the Code that Dan 2

talked about, you know, IWA 3100, 3300 the corrective 3

action provisions in 52.50, those apply when you've 4

discovered the flaw during an inservice examination or 5

a pressure test. The only exception to that is the 6

repair and replacement provisions in IWA 4000. I 7

think that's the position on when the Code applies.

8 So I don't know if we're talking past each 9

other on this, but the Code itself applies during the 10 service life of the plant. It's just that our 11 position is you have to look at the Code to determine 12 when it's applicable and the terms of the Code will 13 tell you when it is and when it is not applicable.

14 (Simultaneous speaking.) That's what we're saying, 15 yeah.

16 MR. LORSON: And what you're saying is 17 that that aspect of the Code is not applicable when 18 the plant's operating, only when it's being examined 19 as required by the Code?

20 MR. LAMOND: Let me help there, Jerry.

21 MR. BONANNO: Yeah, go ahead.

22 MR. LAMOND: The Code doesn't get into 23 whether the plant's operating or not. The Code says 24 go do this examination or this inspection or this 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

80 test. An owner can do those while the plant is 1

operating in some cases. He can do the majority of 2

them during an outage just because it's easier to deal 3

with conditions you find.

4 But the Code doesn't define the plant 5

condition when you do the exam or test. It's says go 6

do this exam or test and if you find something, here's 7

how you evaluate it and if you can't accept it, here's 8

how correct it.

9 MR. BASSO: And I still think we're 10 missing the point about our position on (g)(4). What 11 we're saying is on (g)(4) is really just talking about 12 when you have to update and what you have to do and 13 what you have to comply with, with updating has 14 nothing to do with when to apply the Code or not.

15 It's talking about during the service 16 life, you have to have a plan and it needs to be in 17 accordance with the latest addenda and addition when 18 you update.

19 So, I think, we get back to that piece and 20 then, Dave, I don't know if you're going to say this, 21 but when you roll back this piece of it, I think that 22 next to last bullet, what this will do is introduce 23 that during operability you have to seek NRC approval.

24 Now in this case, it's only for Class 2 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

81 and 3 operational leaks, but what could this expand to 1

if this, in fact, gets interpreted even broader? So 2

I think from the generic issue from operability, we've 3

got to be real careful that now it undermines the 4

licensees' ability to make operability calls without 5

having to seek NRC approval in certain cases. Dave, 6

you have anything more before I go to (Simultaneous 7

speaking.)

8 MR. GULLOTT: Yeah, I just don't want to 9

talk over anybody. Like I said earlier, operability 10 is a licensee process, a licensee decision and a 11 licensee evaluation and what the licensee is seeking 12 is reasonable assurance that the component, reasonable 13 expectation are the words in the guidance, reasonable 14 expectation that the component can perform it's 15 specified safety function, per tech specs. You can 16 use engineering judgment. You can use other technical 17 bases. This position now if you don't have a Code 18 method to do that would then require us to seek NRC 19 approval and as I talked about on the last slide, I 20 mean we would technically be inoperable, the component 21 would be inoperable until we get that approval. When 22 we have reasonable assurance based on all the 23 information available that the component can perform 24 its specified safety function and the system can 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

82 perform its specified safety function.

1 MR. BASSO: Okay, let's get to Andrea's 2

question.

3 MS. KOCK: My mute button is slow today.

4 So I think Dave may have just gotten to the question 5

that I had. The question I have is the one I had a 6

couple of slides back and we moved on and thought we 7

would address it here. I think we just got to it.

8 You said, let's just set aside the cases where you 9

have a condition that is addressed in the Code and you 10 said Industry's position is if you have a condition 11 that is addressed by the Code you would agree that you 12 should use the methods in the Code. Okay, so let's 13 just set those aside. My question is on the 14 conditions where they're not addressed in the Code and 15 whether there's a change to the NRC's interpretation 16 or practice with regard to those cases.

17 So what you're saying is in those cases 18 where the condition is not addressed by the Code, you 19 shouldn't have to use the methods and the Code and you 20 shouldn't have to come to NRC for approval. Would 21 that be a change from the way we've interpreted 22 operability determinations in the past? That's the 23 question I had earlier and I think Dave may have just 24 touched on it, but let me ask just to be clear. Is 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

83 that a change?

1 MR. BASSO: Jerry?

2 MR. BONANNO: Oh, I had a different -- I 3

was going to answer a different question. But I 4

think, well Dave's got his hand up. Dave, do you want 5

to?

6 MR. GULLOTT: Yeah. (Simultaneous 7

speaking.) Let me try and answer that. Generally, 8

yes it would be a change because it's contradicting 9

the established NRC guidance on use of alternative 10 methods in operability determinations that are outside 11 of the licensing or design bases, when determining 12 there is a reasonable assurance that the component can 13 perform its specified safety function for operability 14 per tech specs. That's been an established NRC 15 position and this RIS specifically for ASME types of 16 issues does not allow that use of alternative, non-17 licensing basis methods or non-design basis methods.

18 Okay? So, that's a change there.

19 Then I think if you look at specifically 20 to this issue, if you look at the continuum over the 21 last 20 years of back and forth and I don't think it 22 was as it explicitly stated that you must use approved 23 methods and must come to the NRC for approval, I think 24 it's inferred in some documents.

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84 Like if you look at 90-05, it says you've 1

got to come to the NRC for an approval, but if you 2

read the purpose in just Generic Letter 90-05, sorry, 3

that's for temporary, non-Code repair, that's a 4

corrective action.

5 The NRC has pointed to that for 6

operability as part of their basis for yes, this is 7

our position, but it's confusing what the purpose of 8

that generic letter was for because that generic 9

letter specifically says it's for if we want to use a 10 non-Code, temporary repair to operational leakage then 11 we need to come in for NRC approval. And that's fine, 12 because that's a temporary corrective action, that is 13 a corrective action, it's not an evaluation of 14 operability.

15 Then the 2015 letter we referenced where 16 the NRC came back after this long discussion on this 17 issue and said, well, basically okay that's their 18 position, we need to do something else. We, the NRC, 19 need to do something else to help further this 20 position. So, to say it's a change in position, I 21 think it's been a question on the position for the 22 last 15 or 20 years. The NRC has had their opinion, 23 but I don't think it's rooted in the regulation as we 24 have described. (Simultaneous speaking.) And has not 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

85 been consistently enforced.

1 MR. BASSO: Jerry?

2 MR. BONANNO: Yeah, thanks, Dave and sorry 3

I intervened there with my hand. I didn't wait for 4

Andrea to finish, but I just wanted to clarify one 5

point, too. We've talked about the Code methods if 6

they're available are preferable and I just wanted to 7

make clear that we're not conceding that they're 8

required.

9 I mean I think our position is here that 10 for operational leakage there is no underlying 11 requirement. You've heard us kind of talk about that 12 several times, but I think if the Code methods are 13 available, they're preferable because they're methods 14 that the NRC has reviewed and approved. For example, 15 if it's an approved Code case, it's preferable in the 16 same way that it's preferable if you have in any other 17 context where you have an NRC approved method. I 18 think we would always look to that first and see if 19 that would work and use it. I just wanted to make 20 that clarification.

21 I think the other point that Dave just 22 made is really important because I think we are making 23 a really foundational point about (g)(4) and that if 24 (g)(4) cannot support this interpretation then really 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

86 the history and how often it's been taken is not 1

really relevant. If (g)(4) can't support the 2

interpretation, but I do understand why you're looking 3

at that.

4 It's a

part of most backfitting 5

evaluations and I think, you know, the way I would 6

characterize this is Andrea talked about 7

inconsistencies in the past. I think those 8

inconsistencies do cut both ways. I mean I think what 9

happens is an issue comes up, statements are made 10 about it over a period of time.

11 Industry takes an approach that may be 12 different from what the NRC is saying in certain 13 context and I don't think that all of these documents 14 really hit this point squarely as Dave just mentioned 15 with respect to GL 90-05.

16 Then you get to a point where it's going 17 to be clarified and you get to the point where you're 18 going to issue either a rule or in this case, you 19 decided to issue a RIS and so I would just encourage 20 you in evaluating whether there's a change if you 21 think that that's relevant, just to kind of consider 22 that history. If there have been inconsistencies that 23 doesn't mean that there's no change when you finally 24 decide to say okay we're going to settle this once and 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

87 for all. So those are the comments I had, Tom.

1 MR. BASSO: Hey, we only have a few 2

minutes left, so what I'd like to do is, Dave, could 3

you just like just highlight what you have here and 4

let's jump to Jim and then we'll take any final 5

questions if we have time.

6 MS. COFFIN: Hey, Tom?

7 MR. BASSO: Yes.

8 MS. COFFIN: I'm finding and my colleagues 9

are finding the discussion very helpful so let's not 10 rush to finish in five minutes. I'm hoping the court 11 reporter can stay on. I still think we should be 12 timely and move on because I think we're hearing some 13 things over and over again, so I think we're getting 14 to a very good understanding, but please I don't want 15 you to rush.

16 MR. BASSO: Okay, thank you. Appreciate 17 that.

18 MR. GULLOTT: So, Stephanie, do you want 19 me to just finish this section? I know there are 20 several hands up. How would you like to proceed?

21 MS. COFFIN: Why don't you finish this 22 section and then we'll --

23 MR. GULLOTT: Okay. Tom, you're on slide 24 25, right?

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88 MR. BASSO: Yeah, go ahead.

1 MR. GULLOTT: We've talked about the 2

fundamental regulatory and backfit concerns, and, Ray, 3

I think you've kind of hit on this. So why is this 4

important to the industry and what is the true impact 5

of the RIS?

6 On the last slide, the RIS directly 7

contradicts the NRC position on using alternative 8

methods and engineering judgment when determining tech 9

spec operability. What this does is this position 10 would result in licensees declaring systems inoperable 11 for operational leakage that's understood, that has no 12 impact on the piping or other components and the 13 supporting systems safety function.

14 To be forced to declare a

system 15 inoperable solely because an approved evaluation 16 method does not exist, removes that safety system from 17 service and does reduce safety, especially when it can 18 be shown by other analytical methods, reasonable 19 assurance and engineering judgment that with this 20 operational leakage the system will continue to be 21 capable of performing its safety function with the 22 deficient condition until appropriate time to go fix 23 and take the corrective action and restore compliance 24 with the Code. That fact, this may also indirectly 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

89 impact safety because it really has forced licensees, 1

the forced inoperability, it distracts the 2

organization to immediately address an issue that we 3

can show through our reasonable assessment of 4

operability and an alternate method does not impact 5

the safety function.

6 So while the RIS itself, has limited 7

weight and it's not a regulatory obligation, we 8

understand that, it will be used in inspection space 9

and I think it will drive the position that the only 10 way to assess operability of operational leakage is 11 you must have NRC approval. That will force licensees 12 to change how we operate the plant and the procedures 13 we use to operate the plant from an operability 14 standpoint and operational leakage standpoint.

15 I'll turn it over to Jim. We can close and then 16 follow up with more questions.

17 MR. POLICKOSKI: Stephanie, we'll include 18 questions after my closing comments, is that okay, 19 Stephanie?

20 MS. COFFIN: I'll just check in with Ray 21 in terms of the timing. Does that work for you, Ray?

22 MR. LORSON: That's fine, thank you.

23 MS. COFFIN: Okay.

24 MR. POLICKOSKI: Okay, before I get to my 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

90 closing comments, I think one thing that may also help 1

in this discussion is I think maybe from an outside 2

observer, there may be an accidental assumption that 3

50.55(a) has a very governing role over operability.

4 I think I need to make sure that we pull 5

back to 35,000 feet in the operability determination 6

arena, because there are many parallel complementary 7

regulations that apply in determining operability.

8 It's more specifically 50.36 or tech specs what 9

governs the creation of our licensing and design bases 10 because in the general design criteria because those 11 frame what operability is defined by in terms of our 12 specified safety functions.

13 I just don't want an accidental view that 14 50.55(a) is all encompassing or all governing because 15 operability is governed by many parallel requirements 16 with our license being the main driver of how that 17 function is supposed to be executed and what criteria 18 it's supposed to meet.

19 So I think it's very important that we're 20 having to solve a macro issue when it comes to 21 operability, that governs across multiple 22 requirements. Code is one piece of it, but it's not 23 the only piece. So, thanks, Dave and team. I'll get 24 to our key messages here to make sure that bubble it 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

91 down to the key takeaways for the group here. We 1

appreciate CRGR's patience.

2 First, our view is that this RIS truly 3

expands the federal regulations beyond Section 11's 4

inservice examination flaw evaluation, 5

characterization and corrective action requirements.

6 It grows the scope of Section 11.

7 Two, our view is that this RIS directly 8

limits the myriad operability determination methods 9

causing detrimental effects.

10 So, our view, in summary, is that if the 11 desire of the NRC staff is to impose this 12 interpretation, then a backfit analysis via rule 13 making is required. That said, at a minimum, our 14 final view is this RIS should be withdrawn. We really 15 appreciate and thank you for the opportunity for CRGR 16 to brief you all here today on this important topic.

17 On behalf of my fellow members of 18 Industry, NEI and TVA, we thank you. I'll turn it 19 back over to Tom and also you and Stephanie for any 20 final questions and comments.

21 MR. BASSO: I'll turn it over to Ray, you 22 have a question?

23 MR. LORSON: Yes, thanks. You know, a 24 couple of slides ago we were talking about Generic 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

92 Letter 90-05 and I think the point was made that 90-05 1

in your view applies to repair actions only. I 2

haven't heard any discussion about maybe putting in a 3

backfit claim against Generic Letter 90-05, but I 4

don't understand the difference between identifying a 5

flaw, evaluating the flaw and making the decision to 6

repair the flaw as opposed to identifying a flaw, 7

evaluating a flaw and allow it to remain in place.

8 Fundamentally, I just struggle to see the 9

difference between 90-05 and the RIS in terms of what 10 difference is being opposed and maybe you can help me 11 understand that a little bit better.

12 MR. BASSO: Dave? Marty?

13 MR. GULLOTT: Yes, sorry, I was on mute.

14 I was talking on mute. I'm not sure I understand your 15 question specifically, Ray. The reason I brought up 16 Generic Letter 90-05 was because we were talking about 17 NRC precedent or NRC position and the RIS brings up 18 and talks about Generic Letter 90-05 as one of the 19 approved evaluation methods for operability.

20 But when you go read Generic Letter 90-05, 21 it in and of itself was not intended as the way I've 22 read it and most of us in the industry have read it, 23 was not intended an operability assessment guidance 24 document. It was meant to give the licensee guidance 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

93 on how to perform a non-Code temporary repair until a 1

Code repair could be installed. It wasn't dealing 2

with operability, it was dealing with a corrective 3

action. Corrective action, as I said earlier, if 4

you're not going to follow the Code, you need a relief 5

request. So Generic Letter 90-05 talked about how you 6

needed to go get a relief request to implement a non-7 Code temporary repair on an ASME, I think it's only 8

Class 3, component. As I said earlier with corrective 9

action, corrective actions are part of you have to 10 follow your licensing basis, so that's why I don't 11 think, I mean I haven't studied it from a backfit 12 standpoint, but that's why I wouldn't think 90-05 in 13 and of itself would be a backfit or should be a 14 backfit because it's consistent (Simultaneous 15 speaking.)

corrective action.

(Simultaneous 16 speaking.) I'm sorry.

17 MR. LORSON: No, go ahead.

18 MR. BONANNO: No, no I think, Ray, that it 19 sounded to me like your question cut to that last 20 point that Dave was making. This distinction between 21 the corrective action piece and the operability 22 determination piece and I think that's what you were 23 driving at, is, what's the difference if these are 24 flaw evaluation techniques.

25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

94 But I think in our view, the difference 1

is, like Dave said, with 90-05, those are the flaw 2

evaluation techniques that are used when you're in 3

repair and replacement space and there's no dispute 4

that IWA 4000 applies regardless of when the leak is 5

found. That's because that's what IWA 4000 says.

6 So I think from our perspective again, it 7

was a little bit before my time, despite my beard 8

being as white as it is, but I think probably now 9

looking back at that 90-05, there probably wasn't a 10 backfit challenge because we're in repair and 11 replacement space. So you have to deal with the 12 requirements of the Code when you're doing repair and 13 replacement and this was an acceptable method that was 14 provided to review relief requests, if I'm remembering 15 correctly.

16 The backfitting language of 90-05 did 17 state that the objective of the generic letter is to 18 maintain structural integrity of repaired ASME Code 19 piping. Staff is not imposing a new or different 20 position and it provided guidance that will be 21 considered by the staff when evaluating relief 22 requests submitted by licensees for temporary non-Code 23 repairs of Class 3 piping. That was the focus of it 24 and I think that's why, if I had a look back that's 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

95 probably why you didn't see a backfit challenge to it.

1 MR. LORSON: Okay. So what it sounds like 2

is you see fundamentally a difference between the 3

requirements that would be, and I'm using requirements 4

as kind of a broad term, imposed by Generic Letter 90-5 05 vice what's being proposed by the RIS which talks 6

about evaluation.

7 So if a flaw is discovered that you 8

evaluate and elect not to repair, then we'd be into 9

evaluation of it from a regulatory perspective under 10 the RIS, whereas if you elect to repair that flaw, 11 then the evaluation of your adequacy in the actions 12 taken would be directed by Generic Letter 90-05 and 13 that's where you see the difference? (Simultaneous 14 speaking.) the repair or not, so, I'm sorry.

15 MR. GULLOTT: Oh no, that's okay. Let me 16 respond to that. So, your first statement was whether 17 we elect to repair or not. I don't think we have that 18 option. If we find a deficient condition, we have 19 operational leakage, we have to repair it and that's 20 done through the Corrective Action

Program, 21 commensurate with the safety function and all the 22 specificity of the Corrective Action Program, which is 23 a regulatory program per Appendix B. We have to fix 24 it. We have to repair it. We can't just go on 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

96 infinitum with this thing leaking.

1 But before we even get into the repair, we 2

have to assess the deficient condition from a tech 3

specs standpoint, is it operable? Can the system 4

still perform its safety function with the deficient 5

condition? That's what we're talking about here.

6 If the leakage can be evaluated through an 7

approved method, then we can demonstrate that, yes, it 8

can still perform its safety function, then we can go 9

on for a period of time with it still operable until 10 we get to the right point to fix it, but we have to 11 fix it. It's not about not evaluating it and not 12 fixing it, it's about evaluating it for operability, 13 separate from evaluating it to repair it.

14 The concern with the RIS is it's focused 15 on the operability part of it, not the corrective 16 action part of it. Corrective action part of it, yes, 17 we need to restore compliance with our licensing 18 basis, which includes the CFR, which includes as 19 invoked by the Code we have to restore the component 20 to Code requirements. That may require a relief 21 request, but that's corrective action.

22 We're talking about operability and how we 23 assess with reasonable expectation that the system 24 with a flaw can still perform its specified safety 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

97 function per tech specs.

1 MR.

LORSON:

Okay.

(Simultaneous 2

speaking.)

3 MR. GULLOTT: Okay.

4 MR. LORSON: Thanks.

5 MR. BASSO: Jim?

6 MR. POLICKOSKI: Well, Ray, just again, I 7

see a recurring theme here separating corrective 8

action and operability. I think what may help also is 9

when it comes to the operability decision, the Code 10 provides information, but it does not provide the 11 information in toto for how we're going to decide 12 operability.

13 It's informative, but it is not all 14 encompassing necessarily. I think that's important 15 because I think that may be where we're hitting a 16 difference in understanding or interpretation maybe is 17 the better word, of the Code helps, but it may not be 18 informative enough for us to make an operability 19 decision through all the aspects that that system is 20 required to do, through all the parameters we have to 21 obey and the other parts of the regulation and our 22 license. So, they must be viewed in different lenses 23 completely.

24 They will use a lot of the same tools 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

98 potentially in the evaluation for the repair, but 1

operability will have a much larger scope and what I 2

couldn't tell by your question is whether you're 3

asking it through an operability lens only, a 4

corrective action lens only. I want to make sure we 5

have that clear at least from you understanding the 6

difference, the important nuance in our position.

7 That's what was I just want to make sure.

8 MR. LORSON: And the question, please 9

don't read anything into the question, I was strictly 10 trying to interpret exactly what your position was.

11 MR. POLICKOSKI: Yeah.

12 MR. LORSON: And I think I understand the 13 points you're trying to make.

14 MR. POLICKOSKI: Okay, all right. Thanks, 15 Ray.

16 MR. LORSON: Thanks.

17 MS. COFFIN: All right. I'm going to just 18 check in with the other CRGR members to see if there 19 are any additional questions? Okay and so, I just 20 want to thank you very, very much for this 21 presentation. I think you met the purpose of the 22 presentation.

23 I have to say, I'm speaking for myself 24

here, that engaging verbally and having this 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

99 presentation and opportunity to have Q&A really lends 1

a fulsomeness to your comments. Sometimes you just 2

can't get some of the nuances across in a written form 3

that you can in a presentation and being able to 4

engage back and forth.

5 I appreciate the resources that you put 6

into this and your willingness to engage and help us 7

understand your position including the kind of 8

subtleties that you have been pointing out along the 9

way.

10 With that, is there anybody else who would 11 like to make a comment before we close?

12 MR. BASSO: Yes, Stephanie, again, we'd 13 just like to extend our appreciation for this 14 opportunity. If this was clear, all the conversations 15 and all the interactions between ASME and the Agency 16 and the Industry would not have been happening.

17 I think it's back to some questions that 18 came up several times of well, has this not been the 19 interpretation, but obviously it has not been the 20 interpretation that everyone's been aligned on and has 21 implemented, so we wouldn't have had all these 22 conversations.

23 We appreciate this opportunity and I want 24 to extend if for some reason there are any questions, 25 NEAL R. GROSS COURT REPORTERS AND TRANSCRIBERS 1716 14th STREET, N.W., SUITE 200 (202) 234-4433 WASHINGTON, D.C. 20009-4309 www.nealrgross.com

100 is there a method? Would you like us to respond? Or, 1

if there's a way that we could respond back to you, 2

we're open to that.

3 We'll be available through your review 4

again of our letter and of the slides and of anything 5

we said. If there's something that we can follow up 6

with, we'd be more than happy to do that on an 7

expedited manner.

8 MS. COFFIN: Okay, all right. Thanks very 9

much.

10 MR. BASSO: Okay, thank you.

11 (Whereupon, the above-entitled matter 12 went off the record at 11:15 a.m.)

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