ML20202F099

Rev 1 to Compliance Evaluation Rept for Renewal of Coc GDP-1, for Paducah Gaseous Diffusion Plant,Paducah,Ky

ML20202F099
Person / Time
Site:	07007001
Issue date:	01/31/1999
From:	NRC OFFICE OF NUCLEAR MATERIAL SAFETY & SAFEGUARDS (NMSS)
To:
Shared Package
ML20202F057	List: ML20202F053 ML20202F062 ML20202F075 ML20202F099 ML20202F106
References
NUDOCS 9902030325
Download: ML20202F099 (42)

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i-COMPLIANCE EVALUATION REPORT o

FOR THE RENEWAL OF CERTIFICATE OF COMPLIANCE GDP-1 4 i  !

l REVISION 1 i UNITED STATES ENRICHMENT CORPORATION PADUCAH GASEOUS DIFFUSION PLANT l PADUCAH, KENTUCKY q DOCKET 70-7001 JANUARY 1999 i

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l U.S. Nuclear Regulatory Commission Office of Nuclear Material Safety and Safeguards Division of Fuel Cycle Safety and Safeguards Washington, DC 20555 L

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e TABLE OF CONTENTS

1.0 INTRODUCTION

. . . . . . . . . . . . . . .......................... ............ 1 1.1 lntroduction . . . . . . . . .. ... ............ . ......... ............ 1 1.2 Certification History . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 1.3 Compliance History . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 1.4 Interagency Consultation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 1.5 Possession Limits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ....... .... .7 1.6 Plant Description . . . . . . .................. .. .... ..... .... .... .7 1.7 Authorized Activities . . . . . . . . . . . . . . . .......... . ............... 12 1.8 Codes and Standards . . . . . . . . . . . . . . . . . . .. ......... ............ .13 2.0 SITE CH ARACTERISTICS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...... .. . 14 3.0 ORGANIZATION AND ADMINISTRATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . ... 14 3.1 Organization . .... ........... ... ............. ........ .. 14 3.2 Saf ety Review Systems . . . . . . . . . . . . . . . . . . . . . . . . . . . . ......... .... .16 ,

3.3 0 p e ration s . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...... 16 3.4 Training . .............. .. .. ...... ..... .... ............. 17 3.5 Procedures . . . . . .. .................. ......... ............. 17 3.6 Human Factors . . . ........................ ............... .... .18 3.7 Audits and Assessments . . . . . . . . . . . . ... ................. ...... 18 3.8 Quality Assurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ............... 19 3.9 Event Reporting and Investigations . . . . ..............................20 3.10 Record Management . . . . . . . . . . . . . . . ............. . . . . . . . . . . . . . . . 21 3.11 Maintenance . . . . . . ................ .... ......................21 3.12 Configuration Management . . . . . . . . . . . . . . . . . . . . . . ................. 21 3.13 Management Controls . . . . . . . . . . . . . . . . . . . . . . . . ................. . 21 4.0 FACILITY AND PROCESS DESCRIPTION . . ................. ........ . . 22 5.0 ACCIDENT ANALYSIS . . . . . . . . . . . . . . . . . . . . . . . . . . . . .............. ... 23 6.0 TECHNICAL SAFETY REQUIREMENTS . . ......................... ... 24 7.0 R ADI ATI ON S AF ETY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 8.0 NUCLEAR CRITICALITY SAFETY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . .. 26 9.0 ENVIRONMENTAL PROTECTION AND WASTE MANAGEMENT . . . . . . . . . . . . . . 27 10.0 CH EMICAL S AF ETY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 11.0 FIRE PROTECTION . . . . . . . . . . . . . . . . . ....... ........................ 28 12.0 EMERG ENCY PREPAREDN ESS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 e

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l 13.0 SECURITY AND SAFEGUARDS. . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . 29 I

13.1 Material Control and Accounting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 13.2 Physical Security and Transportation Protection . . . , . , , . . . . . . . . . . . . . . . . 30 13.3 Classified Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31  !

14.0 D ECO MMI S S I O N I N G . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 t-15.0 CO M P LI AN C E P LAN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 l i

i 16.0 ENVI RONMENTAL REVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34 17.0 AUTHORIZATIONS AND EXEMPTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 1

18.0 TE R M O F C ERTI FICATE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . 35 19.0 CONC LU SI O N S . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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e. r-20.0 ' ACRONYMS AND ABBREVI ATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

APPENDIX A' PUBLIC COMMENTS AND NRC STAFF RESPONSES . . . . . . . . . . . . . . . . 39 4

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1.0 INTRODUCTION

1.1 Introduction -

This report documents the United States Nuclear Regulatory Commission (NRC) staff i compliance evaluation report of the U.S. Enrichment Corporation (USEC) certification application for renewal of Certificate GDP-1 for the Paducah Gaseous Diffusion Plant (PGOP) located in Paducah, Kentucky. The Paducah facility enriches natural uranium to a maximum of 2.75 weight percent 2asU by the gaseous diffusion method. The April 15,1998, application for renewal of Certificate GDP-1 does not contain any changes to the existing documentation; USEC incorporates by reference previous applications, statements, and reports into the renewal application. The application is based on USEC's initial application, as revised through Revision 24 dated April 15,1998, and USEC's Compliance Plan, as revised through Revision 7, dated March 20,1998. The renewal request is for a five-year period. The application consists of a safety analysis report (SAR), technical safety requirements (TSRs), emergency plan, a quality assurance program, environmental compliance status report, fundamental nuclear material control plan, transportation security plan, physical security plan, security plan for protection of classified matter, waste management program, decommissioning funding program, environmental information, and the compliance plan.

The application and all nonproprietary, unclassified supporting information and communications are available at the NRC Public Document Room (The Gelman Building,2120 L Street, N.W.,

Washington, DC 20555) and at the Local Public Document Room (Paducah Public Library,555 Washington Street, Paducah, Kentucky 42003) under Docket 70-7001.

As part of the staff's consideration of the renewal application, there was a public comment period on the application. Notice appeared in the Federal Reoister (63FR24832) on May 5, 1998, providing a 45-day public comment period on the application. No comments were received on the Paducah renewal application.

No major changes to programs or operations have occurred since the initial certification. The amendment on the SAR upgrade, which contains changes to the accident analysis and major changes to the TSRs, is still pending. The staff's review of this amendment is expected to be completed early next year. Therefore, the staff has conducted a limited review of those portions of the application for this renewat that did not include Chapters 2,3, or 4 of the SAR or the facility-specific TSRs. In addition, the staff did not conduct a new, complete review of those programs that have not substantively changed since the initial certification.

1.2 Certification History On September 16,1996, the Director, Office of Nuclear Material Safety and Safeguards signed i the Director's Decision on initial certification of the GDPs. Notice of this Decision appeared in f the Federal Reaister (61FR49360) on September 19,1996. The staff received several petitions requesting Commission review of the Decision. The Commission issued its Memorandum and Order (CLl-96-12) on November 22,1996. The Commission denied the petitions, allowing the certification to go forward. On November 26,1996, NRC issued Certificate of Compliance

! GDP-1 for the PGDP. The NRC assumed regulatory jurisdiction for the PGDP on March 3, 1997.

On February 28,1997, the staff issued a Notice of Enforcement Discretion, NOED GDP97-1, to allow the plant to continue using the feed facility cranes af ter the NRC assumed jurisdiction, i The actual field configuration of two feed facility cranes did not match the design feature l specified in the TSR. Therefore, USEC could not use the cranes without being in violation of its  !

Certificate of Compliance. Without use of the cranes, USEC would have needed to place the plant in a recycle mode. The staff concluded that the NOED was warranted. The NOED was effective until the staff issued Amendment 2 on May 16,1997, to revise the design feature for i the cranes.

In April 1997, USEC requested permission to submit its material balance and inventory reports according to a schedule different than that specified in 10 CFR 74.13(a)(1) and to report in accordance with Department of Energy (DOE) requirements instead of NRC requirements.

Title 10 CFR Part 74.15(a) requires USEC to report special nuclear material (SNM) transactions I on a computer-readable DOE /NRC Form 741 for inclusion in the Nuclear Materials Management and Safeguards System (NMMSS). In addition,10 CFR Part 74.13(a)(1) requires USEC to report to NMMSS, on a computer-readable DOE /NRC Form 742, material balances concerning SNM received, produced, possessed, transferred, consumed, disposed of, or lost, on a six-month frequency. The current computerized reporting system, which is based on existing NRC guidance documents, does not address the semi-annual reporting needs for gaseous diffusion uranium enrichment facilities. Until the NRC guidance documents and the NMMSS reporting system are revised, USEC will not be able to completely comply with the requirements contained in 10 CFR Part 74.13(a)(1). Therefore, on April 30,1997, NRC granted l USEC an exemption from the reporting requirements in 74.13(a)(1). Instead, USEC is required l to continue to make the transaction data reports on DOE /NRC Form 741. NMMSS will continue to periodically generate NMMSS Report M-742 using the information provided in USEC's DOE /NRC Form 741 submittals. The exemption also required USEC to reconcile facility  ;

records with NMMSS Report M-742 on a bimonthly basis, in accordance with DOE Order l 5633.3B. In September 1997, USEC asked for a modification of two reporting requirements imposed by NRC's April 30,1997, exemption letter. USEC requested that it be allowed to reconcile facility records with NMMSS-ganerated M-742 reports every six months as opposed to every two months, and to discontinue sending facility-generated inventory reports to the i cognizant DOE field office after they have been reconciled with the M-742 report. The NRC l staff concluded that since DOE discontinued its jurisdiction over USEC nuclear materialin the l leased and certified areas of PGDP on March 3,1997, l>SEC should not be required to submit  ;

inventory reports to a DOE field office. In addition, the NRC staff concluded that reducing the l

! frequency, for reconciling facility records with NMMSS-generated M-742 reports, from bimonthly to semiannually, would not reduce the effectiveness of the PGDP safeguards program and that this was consistent with the requirements of 10 CFR Part 74.13(a)(1). Therefore, on November 21,1997, NRC exempted USEC from submitting reports of facility-generated inventory records reconciled with NMMSS-generated M-742 reports to the cognizant DOE field office and allowed USEC to reconcile facility-generated inventory records with NMMSS-generated M-742 reports I for the semiannual periods ending on March 31 and September 30 of each year. An NRC-sponsored project is underway to revise the guidance to specify what data shall be reported by enrichment plants to NMMSS. This project is not complete, therefore, these exemptions remain I in effect until NRC completes its revision of and USEC conforms to the guidance.

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In August 1997, USEC began a classified matter review at the Paducah site in response to several discoveries of classified matter being improperly controlled. NRC regulations require immediate reporting of such discoveries. Because of the pctential number of reports that might .

have been generated by the review effort, USEC requested an exemption from the reporting provisions of 10 CFR 95.57(b) for the PGDP. The staff determined that the temporary delay in reporting would not pose an undue risk to the common defense and security. Therefore, on October 28,1997, the NRC granted USEC an exemption from the immediate reporting requirements contained in 10 CFR 95.57(b) for those discoveries made within the PGDP fence line. USEC was required to provide written reports on a weekly basis for those discoveries subject to the exemption. The exemption expired at midnight on June 30,1998. PGDP is now required to report all security discoveries in accordance with 10 CFR 95.57(b)

On April 22,1998, the NRC issued a Confirmatory Order Modifying Certificate for the PGDP.

The Order was issued to confirm USEC commitments to instalt seismic modifications in the C310/310-A and C-315 buildings. The modifications were to increase the seismic capacity of the equipment in the facilities to withstand an earthquake producing a peak ground acceleration of 0.165g. The Order modified the Certificate of Compliance to add a new condition which required USEC to complete the modifications by September 30,1998, and to implement compensatory measures until the modifications were complete. USEC has completed all of the modifications required by the Order.

On September 1,1998, the staff issued NOED No. GDP 981 to allow the plant to continue using the Normetex pumps in the withdrawal facility. During the investigation of an operational trip of the Building C-315 Normetex Pump No. 2, USEC determined that the Normetex pump high discharge pressure safety system trip design and operation would not be able to meet its intended safety function of preventing the Normetex pump discharge pressure from exceeding 45 psia. This required the cascade to be placed in the recirculation mode, which entails safety and economic consequences which could lead to plant shutdown. The accident of concern for the Normetex pumps is an overpressurization of the pump's discharge line expansion joint bellows leading to a rupture of the bellows resulting in a UF release. The calculated source term from such a rupture was found to be 3 pounds of UF.. Such a small release is of minor safety significance. USEC proposed operational procedure changes to prevent the safety lirnit from being exceeded. The staff concluded that the NOED was warranted because the action involved minimal or no safety impact and had no adverse radiological impact on public health and safety. The NOED will be effective until the NRC takes final action on the pending ,

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certificate amendment request to delete the safety limit.

On October 20,1998, the staff issued NOED No. GDP 98 2 to allow the plant to continue using I

. the Normetex pumps in the withdrawal facility without complying with the safety limit in TSR 2.3.2.1, *Normetex Pump High Discharge Pressure System." The procedural changes put in place were not enough to ensure that the operator monitoring the discharge pressure could take actions to ensure that the 45 psia safety limit was not exceeded. USEC requested enforcement discretion not to enforce compliance with the safety limit in TSR 2.3.2.1. The staff concluded that the NOED was warranted because the action involved minimal or no safety impact and had no adverse radiological impact on public health and safety. The NOED will be ,

- effective until the NRC takes final action on the pending certificate amendment request to delete the safety limit. .

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The NRC has issued 17 amendments to Certificate of Compliance GDP-1 since the initial certification. There are currently 6 amendment requests pending. Certificate of Compliance GDP-1 expires on December 31,1998. If the NRC has not taken final action on the renewal application before the expiration date, the plant may continue to operate under the timely renewal provisions of Part 76.

Privatization The U. S. Enrichment Corporation Privatization Act directed USEC to implement a privatization plan. The Act also prohibits the issuance of a certificate of compliance by NRC to that entity if NRC determines that:

The entity is owned, controlled, or dominated by an alien, a foreign corp > ration, or a foreign government; or lssuance of a certificate of compliance would be inimical to the common defense and security of the United States; or

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lssuance of a certificate of compliance would be inimical to the maintenance of a reliable and economical domestic source of enrichment services.

NRC prepared, in consultation with the Executive Branch agencies, a Standard Review Plan (SRP) to ensure consistency in, and to formally document, the process that was to be used by the staff to make the foreign ownership, control or domination, common defense and security, and reliable and economical source of domestic enrichment services determinations required by the statute. The SRP was used to make the findings to support privatization, and it will be used in the future when the staff must make the above findings to support recertification or other licensing actions.

By letter dated May 28,1998, the Commission provided a Final Conditional Consent to Transfer the gaseous diffusion plant Certificates of Compliance to the privatized USEC following an Initial Public Offering (IPO) sale process. The NRC reviewed the privatized corporation's Foreign Ownership, Control, or Influence application, Standard and Poor's credit ratng, and the USEC submission in response to NRC information Notice 89-25, " Unauthorized Transfer of Ownership or Control of Licensed Activities." Based on the review of those documents, supplemented by interaction with the High Enriched Uranium Oversight Committee on common defense and security requirements, the Commission determined that the proposed IPO privatization process and the resulting private corporation will meet all applicable NRC regulatory requirements, including those derived from the USEC Privatization Act regarding foreign ownership, control, and domination; common defense and security; and the maintenance of a reliable and economical source of domestic enrichment services. The Consent to Transfer was conditioned upon eight items which USEC has met. USEC, Inc. was formally privatized by the U.S. Treasury Department on July 28,1998. USEC (the certificate holder) is a wholly-owned subsidiary of USEC, Inc.

As a condition of transfer, USEC consented to conditions related to foreign ownership, control and domination and the Russian High Enriched Uranium (HEU) Agreement. In order for these 4

conditions to continue into the renewal period, the staff plans to include the following conditions in the Certificate.

If, at any time after the privatization date, the Corporation obtains information reasonably indicating changes described in the National Industrial Security Program Operating Manual, DOD 5520.22-M, January 1995 (NISPOM), Chapter 1, Section 3,1-302(h), to the information previously submitted to NRC, described in the NISPOM, Chapter 2, Section 3,2-302b.(1) through (11), the Corporation shall notify NRC in writing within 15 days.

If the Corporation enters into negotiations for the proposed merger, acquisition, or takeover by a foreign person, the Corporation shall submit notification to NRC, in writing, within 15 days of the commencement of such negotiations. The submission shallinclude the tyn> of transaction under negotiation (stock purchase, asset purchase, ete L :he identity of the potential foreign person investor, a plan to negate fore!rn ownership, control, or domination, and copies of any related loan, purchase and shareholder agreements, annual reports, bylaws, articles of incorporation, partnership agreements, and reports filed with other federal agencies.

USEC, or its successors, as the Executive Agent for the United States for implementing the Russian HEU Agreement, shall notify NRC in writing within 15 days, of any termination or material change in the provisions of the

" Memorandum of Agreement Between the United States Acting By and Through the United States Department of State, and the United States Department of Energy and the United States Enrichment Corporation, for USEC to Serve as the United States Government's Executive Agent Under the Agreement Between the United States and the Russian Federation Concerning the Disposition of Highly Enriched Uranium Extracted from Nuclear Weapons," entered into as of April 18, 1997.

The staff has not conducted a new determinations review for the renewal. The original determination was made during the timeframe the staff was working on the renewal. The staff is not aware of any information that would change the determination used to support the July privatization. The staff will make new findings at the time of the next recertification review (5 years).

1 1.3 Compliance Histoiy The NRC has two resident inspectors located at PGDP. In addition, Region ill and Headquarters staff con juct inspections of the activities at the PGDP. From March 3,1997, through October 14,1998, NRC conducted 42 routine inspections and 1 special inspection of I plant operations, plant raaintenance, plant support, engineering, fire safety, chemical process safety, nuclear criticality safety, security, transportation, and material control and accounting. I The inspections resulted in two Severity Level 111 and 56 Severity Level IV violations being assessed against USEC. Twenty-three non-cited violations were also documented in I inspection reports.

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. l Violations of NRC regulations are classified by four severity levels, with Severity Level I being assigned to violations that are most significant and Severity Level IV being assigned to violations that are least significant. There are other violations of minor safety, safeguards, or I environmental significance that are below the level of significance of Severity Level IV l violations. These violations are not usually subject to formal enforcement action and to the extent such violations are described in the inspection reports, they are noted as non-cited i violations.

The first Severity Level Ill violation at Paducah was for multiple instances where USEC failed to i properly implement provisions of its Security Plar for the Protection of Classified Matter and l failed to provide complete and accurate information to the NRC in regards to the Security Plan.

Although the actual secunty consequences were minimal in this case, NRC concluded that

! collectively, the deficiencies were indicative of a programmatic breakdown of the USEC security program.

The second Severity Level lil violation at Paducah involved USEC's failure to maintain control of classified matter at the Paducah facility. While the actual security consequences appeared l to be minimal in this case, this was a significant regulatory concern because of the potential for compromise of classified matter. The classified matter was accessible to uncleared personnel.

The violations indicated problems with both the historical and current measures used by the l plant staff to control classified materials. USEC was assessed a civil penalty of $55,000 for this '

l Severity Level ill violation.

The majority of the Severity Level IV violations at Paducah were in the areas of criticality safety, ,

security, procedures (either implementing incorrect procedures or failing to follow procedures), I quality assurance, and TSRs.

During February 1997, PGDP staff identified some inadequacies in the implementation of a nuclear criticality safety approval (NCSA) written for the Building 400 cylinder wash operation; Specifically, the inadequacies were related to the independent verifications required by the NCSA. Following identification of this issue, plant management shut down the cylinder wash operation and initiated an investigation. Because of the potential safety significance of the findings and the timing relative to the NRC's assumption of regulatory authority, the NRC, issued Confirmatory Action Letter (CAL) No. Rill 97-003 on February 28,1997. The CAL was effective March 3,1997, concurrent with NRC assumption of regulatory authority. The CAL described tnose actions committed to by plant management to ensure a thorough investigation and resolution of issues. By letter dated June 11,1998, NRC formally closed the CAL after the NRC verified the actions had been completed.

1.4 Interagency Consultation The Energy Policy Act of 1992 requires the NRC to consult with the Environmental Protection Agency (EPA) regarding certification. As part of that process, the NRC provided a copy of the April 15,1998, USEC application for renewal to EPA. The staff also provided copies of the l updated Environmental Compliance Status Report and Environmental Monitoring Report for the l Paducah plant. EPA responded by lotter dated June 19,1998. EPA found the environmental I section of the application to be factually accurate and complete. EPA noted that there were no t

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• current enforcement actions being taken at the USEC Paducah plant. Tha staff also consulted with EPA and DOE during the preparation of the Annual Report to Congress. See Appendix A for a response to EPA comments on the Portsmouth GDP that have been treated as having generic application to both plants.

In October 1997, NRC and DOE entered into a Memorandum of Understanding (MOU). The MOU delineates the responsibilities of NRC and DOE at the GDPs in areas such as exchange of information and technical staff support, emergency response, modification of the Compliance Plans, referral of identified concerns to the respective agency responsible for the particular concern, and other activities requiring coordination between NRC and DOE.

1.5 Possession Limits The regulations in 10 CFR 76.35(a)(2) require USEC to provide the "name, amount, and specifications (including the chemical and physical form and, where applicable, isotopic content) of the special nuclear material, source and byproduct material the Corporation proposes to use, possess or produce, including any material held up in equipment from previous operations."

The possession limits for NRC regulated source material, byproduct material, and special nuclear material are listed in Table 1-3 of the SAR. The table specifies the maximum quantity of regulated material that may be possessed by PGDP at any given time.

PGDP can possess up to 655,000 metric tons of uranium as source material; 10 curies (Ci) thorium as laboratory chemicals and calibration sources; 10,000 metric tons of uranium enriched up to 2.75 weight percent (wt %) as special nuclear material; 100 kg uranium enriched up to but less than 10 wt % that is held up in equipment, used as calibration standards, laboratory chemicals, samples, or process wastes; up to 10,000 grams uranium enriched greater than 10 wt % but less than 20 wt % that is held up in equipment, used as calibration sources, samples, or process wastes; up to 1000 grams uranium enriched to greater than 20 wt

% t. hat is held up in equipment or used in calibration sources; 10 grams 23 U as laboratory sources; 2 grams plutonium as laboratory chemicals and calibration sources; up to 2 Ci of byproduct material; 500 mci Am-Be neutron sources; 100 mci 252Cf source; and other material that exists as contamination as a consequence of the historical feed of recycled uranium.

Based on the possession limits, PGDP is considered to be a Category 111 facility for safeguards and security purposes.

1.6 Plant Description The regulations in 10 CFR 76.35(a)(1) require USEC to include in the SAR the " activities and locations involving special nuclear material and the general plan for carrying out these activities." This information is provided in Chapters 1,2, and 3 of the SAR.

The Paducah facility is located in the northwestern corner of Kentucky in western McCracken County. The plant is located within a federally-owned reservation of approximately 3,423 acres, of which approximately 748 acres are within the controlled plant security fence. The area surrounding the facility is predominantly rural. Immediately adjacent to the site is the West Kentucky Wildlife Management Area (WKWMA). The WKWMA is leased to the Commonwealth of Kentucky and consists of about 2,080 acres of the reservation. The WKWMA is used by the 7

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public for recreational purposes such as hunting and fishing, horseback riding, field trails, hiking, and bird watching. Bordering the reservation to the north and northeast is the Tennessee Valley Authority Shawnee Steam Plant on the Ohio River. The f acility is located about 10 miles west of Paducah, Kentucky, and 3.6 miles south of the Ohio River. Figure 1 shows the regionallocation of the PGDP. ,

The principal process and purpose of the PGDP is the production of enriched uranium for nuclear power reactor fuel. The uranium fuel cycle starts with the mining and milling of uranium.

ores to produce yellow cake, followed by the conversion of the yellow cake into uranium hexafluoride (UFe). The UF,is then shipped to an enrichment facility where the concentration of fissionable sU is increased. This enriched UF,is transported to other fuel cycle facilities where it is processed and fabricated into fuel assemblies and then sent to nuclear power reactors.

PGDP is a type of enrichment facility. ,

The gaseous diffusion separation process depends on the separation effect arising from '

molecular effusion (i.e., the flow of gas through small orifices). When a mixture of gas molecules is confined in a vessel, the average velocity of the lighter molecules is greater than that of the heavier molecules. Therefore, the molecules of the lighter gas strike the vessel walls more frequently than the molecules of the heavier gas. If the walls of the container are porous with holes large enough to permit the escape of individual molecules, but sufficiently small so that bulk flow of the gas is prevented, then the lighter molecules escape more readily than the heavier ones. The gas consisting of the escaped molecules is then enriched with respect to the lighter component of the mixture.

The primary purpose of the enrichment facilities at the PGDP is to produce uranium enriched in 235U assay and to strip uranium partially depleted in 23sU content to an economically feasible assay. The PGDP enrichment facility consists of about 1800 operating stages arranged in two parallel cascades. The cascade buildings are designated as C-331 (400 stages), C-333 (480 stages), C-335 (400 stages), C-337 (480 stages), and C-310 (60 stages). The surge and waste building, C-315, does not contain any operating stages. The degree of isotopic separation in an efficiently operating diffuser cascade is only about 0.2 percent per stage. Consequently, between 500 and 700 stages are required between the feed point and product withdrawal point to enrich uranium from normal feed at 0.71 wt % 23sU to product ranging from 0.95 to 2.0 wt %

23sU. These stages are called the enrichers. An additional 700 to 1100 stages are used to strip the rasU isotope from normal feed to a tails withdrawal assay of 0.2 to 0.3 wt % 23sU. These stages are called the strippers. The plant can produce 11.3 million separative work units (SWUs) annually at a rated power consumption of 3040 megawatts. The plant typically operates in the 1200 to 1600 megawatts range.

The basic unit of the gaseous diffusion process is the gaseous diffusion diffuser (or converter).

Compressed UF, feed gas is made to flow inside a porous membrane or barrier tube.

Approximately one-half of the gas passes through the barrier into a region of lower pressure.

This gas is enriched in the component of lower molecular weight (23sU) and is sent to the next diffuser. The gas that does not pass through the barrier is depleted with respect to 35U and is sent to the previous diffuser. Upon leaving the diffusion chamber, the enriched and depleted streams have to be recompressed to the barrier high-side pressure to make up for frictional losses. Because the degree of enrichment achieved in a single diffusion stage is very small, to 9

1 achieve useful enrichment levels, the effect must be multiplied many times over by making use of a cascade of many stages in series. The exact number of stages required is determined by the enrichment needed.

The main components of a gaseous diffusion plant are: large cylindrical vessels called diffusers that contain the barrier, compressors used to compress the gas to the pressures needed for flow through the barrier tubes and from one stage to another, electric motors to drive the compressors, heat exchangers and cooling circuit for removing the heat of compression, piping for stage and interstage connections, control valves to adjust the gas flow, and block valves to isolate a group of stages comprising a cell. In addition to this process stage equipment, gaseous diffusion plants require auxiliary systems such as the UF, feed and withdrawal systems, an extensive electrical power distribution system, and cooling towers to dissipate the waste process heat. The following contains a brief description of the operations that occur in each of the main buildings. Figure 2 shows the plant layout.

C-360: Toil Transfer and Samplina Buildina This building has systems in place for cylinder receipt, unloading, inspection, weighing, cold pressure checking, sampling, and shipping. There are four autoclaves for sampling and transfer of UF. to customer-owned cylinders.

C-333-A and C-337-A: Feed Vaporization Facilities These buildings contain the cascade feed facilities. The feed cylinders are placed in autoclaves and heated to convert solidified UF, to a pressurized vapor which can be controlled by valves and flow measuring devices to maintain distribution of UF, gas through heated piping to appropriate points in the enrichment cascade. C-333-A contains four feed stations and C-337-A contains five feed stations.

C-331. C-333. C-335. and C-337: Process Buildinas These buildings contain the heart of the enrichment process. C-331 and C-335 each contain four units and are known as the "00" buildings. There are ten cells per unit and ten stages in a cell. C-333 and C-337 each contain six units and are known as the "000" buildings. There are ten cells per unit and eight stages in a cell. Each stage contains a motor, compressor, converter, control valve, coolant system, and associated instrumentation. C-333 and C-337 also contain freezer / sublimer units that are used for inventory control. These units allow the excess UF, inventory to be rapidly removed from the cascade by freezing it in storage vessels and then returning it to the cascade by sublimation when required.

C310/C-310-A Purae and Product Buildina This building contains the equipment for product withdrawal. C-310-A contains the liquefaction process. C-310 contains the cylinder filling operation. The product UF,is transferred from the gaseous to the liquid state, loaded into cylinders, and solidified in preparation for shipment.

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dry air plant (which is numbered C-620). ' UF. gas is compressed and condensed as liquid UF, and drained as hot liquid at above atmospheric pressure. The cylinders are weighed and i moved outside to cool; after coding the cylinders are moved to a storage yard. i C-400: Chemical Operation Buildina (Cleanina Buildina)

This building houses the decontamination and uranium recovery equipment.

1

'C-300: Central Control

- This building houses the Central Control Facility (CCF). The CCF houses the shift j l

superintendents, cascade coordinator, and power operations foreman. All PGDP critical plant processes, enrichment operations, electrical distribution system operations, utilities,

. communications, plant alarm systems, and emergency operations are monitored and/or

- controlled, either directly or indirectly, from this facility.

C-710: Technical Services Buildina j-This building contains the laboratories, shops and facilities necessary for process control,

building maintenance, and development of laboratory instruments.

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These areas are used for interim and long-term storage of UF, cylinders.-

1.7 Authorized Activities The PGDP authorized activities for each regulated material are listed in Table 1-4 of the SAR.

The authorized operations are discussed in more detailin Chapter 3 of the SAR. The activities conducted at PGDP are:

1. Heating UF, cylinders and feeding contents into the diffusion process.

2 l 2. Enrichment of uranium up to 2.75 wt % asU.  ;

' 3. Receipt, storage, inspection, and acceptance sampling of cylinders containing uranium l 2

enriched up to 2.75 wt % asU.

4. Filling, assay, storage, and shipment of cylinders containing uranium enriched up to 2.75 wt % 2asU.

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6. Storage of process wastes containing uranium, transuranic elements, and other contaminants and decay products.

7. Process, characterize, package, ship, or store low-level radioactive and mixed wastes (storage of mixed wastes is limited to 90 days).

8. Radiation protection, process control, and environmental sample collection, analysis, instrument calibration, and operation checks.

9. Maintenance, repair, and replacement of process equipment.

10. Process Control Laboratory analysis and testing.'

11. Transfer between cylinders.

12. Calibration and use of portable health physics and fixed laboratory equipment.

13. Nondestructive testing and analyses of product and process streams.

14. Storage of special nuclear material and byproduct material remaining in equipment and facilities from previous operations.

15. Swipe samples for assays in excess of 2.75 wt % 835U (from K-25 operations).

16. Calibration of neutron measuring instrumentation.

17. Use of neutron sources as internal sources in density meters.

18. Use of americium in smoke detectors.

19. Use of neutron sources for UF, assay and flow instrumentation.

The activities listed above are those which the NRC has reviewed and will continue to certify that they meet regulatory requirements. If additional activities are planned USEC will need to perform a safety analysis and propose TSRs as necessary prior to conducting the activity.

1.8 Codes and Standards l

l Appendix A to Chapter 1 of the SAR contains a list of the various industry codes and standards and NRC regulatory guidance documents that have been referenced in the PGDP certification l l

correspondence. The Appendix lists the extent to which PGDP satisfies each code, standard,  !

and guidance document. In accordance with Compliance Plan issue 45, USEC submitted a

' Sample analysis is limited to those samples directly related to current or previous enrichment operations. Analysis of samples from outside sources is not authorized under Certificate of j Compliance GDP-1. l 13

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revision to Appendix A after reviewing the specific commitments to the various codes and standards. Although USEC has completed this Compliance Plan issue, the NRC has not i completed its review and closed the issue. The staff plans to complete this review with the SAR upgrade (SARUP) amendment which is currently under review.  !

2.0 SITE CHARACTERISTICS I 1

Update of the information in Chapter 2, " Site Characteristics," of the SAR is part of the SARUP and were not reviewed as part of the renewal effort. The new information will be reviewed as ,

l part of the SARUP effort.

l 3.0 ORGANIZATION AND ADMINISTRATION The regulations in 10 CFR 76.35(a)(7) require that the SAR contain "a description of the management controls and oversight program to ensure that activities directly relevant to nuclear safety and safeguards and security are conducted in an appropriately controlled manner that ensures protection of employee and public health and safety and protection of the national security interests." Chapter 6 of the SAR describes many of the organization and management controls utilized by USEC to meet this requirement.

3.1 Organization USEC is a wholly-owned subsidiary of USEC, Inc. Corporate offices are located in Bethesda, Maryland. USEC has hired a contractor, Lockheed Martin Utility Services, Inc. (LMUS), to operate the plant.2 USEC retains responsibility for the safe operation of the facility. USEC l approves the management structure and key positions; assignment of individuals to key positions; and qualifications, responsibilities and authorities for key positions.

USEC and LMUS have established independent reporting chains for the safety functions. The organization is discussed in Section 6.1 of the SAR. There have been no substantive changes to the organization structure since the initial certification. By TSR 3.3, USEC is required to use qualified individuals in f acility positions and to meet the responsibilities and qualification requirements described in the SAR for the key staff positions. TSR 3.2.1 requires USEC to establish and define the lines of authority, responsibility, and communication. The TSR also requires the safety functions to have organizational freedom to ensure independence from operations. Figure 3 shows the USEC organization structure.

TSR 3.1.1 assigns corporate responsibility for overall GDP safety to the Executive Vice President, Operations. TSR 3.1.2 assigns responsibility for the overall safe plant operations to the General Manager. The Plant Shift Superintendent responsibilities are assigned by TSR 3.1.3. The Plant Shift Superintendent is responsible for the operational aspects of the plant and for the central control room command function. TSR 3.1.4 assigns the Division Managers responsibility for operations conducted within their facilities. These TSRs assigning

responsibility are similar to the Westinghouse Standard Technical Specifications (WSTS). The staff concludes that the organization structure and assignment of responsibilities remain acceptable.

2On November 18,1998, USEC announced that it will take over direct management and I operation of the GDP's and that the transition is expected to be completed in 6 months, l 14 i

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Ja The regulations in 10 CFR 76.35(a)(3) state that the SAR must include: "The qualifications

. requirements, including training and experience, of the Corporation's management organization and key individuals responsible for safety ir, accordance with the regulations in this chapter."

Section 6.1.1 of the SAR describes the minimum qualifications needed for the key positions. It

_ is the responsibility of USEC to ensure that indisiduals in these positions meet the qualification a requirements. TSR 3.3 requires facility positions to be filled by individuals whose

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v experience / training qualify them for the position.

There have been no substantive changes to the minimum technical qualifications provided in the application since the init;al certification. On this basis, the staff concludes that the minimum technical qualifications remain acceptable.

3.2 Safety Review Systems The regulations in 10 CFR 76.68(a) require that plant changes must be approved by a safety review committee USEC has established a safety committee to assist in the oversight function required by 10 CFR 76.35(a)(7) and to meet the requirement in 76.68(a). The safety committee, which is the Plant Operations Review Committee (PORC), is described in SAR Section 6.2 and in TSR 3.10. The PORC functions in an advisory role and supports the General Manager. USEC has also established an As Low As is Reasonably Achievable (ALARA) subcommittee and may from time to time establish other subcommittees to provide assistance in conducting the reviews and assessments required by the PORC.

The commitments for a safety committee have been reviewed and the staff concludes that the commitments are adequate. There have been no substantive changes to the safety review systems since the initial certification. On this basis, the staff concludes that the safety review systems remain acceptable.

3.3 Operations Operations is one of the topics required by 10 CFR 76.87(c) to be included iri the TSRs.

Operations 6 discussed in SAR Section 6.5. TSR 3.19 requires USEC to establish, implement, and maintain the operations program described in the SAR. The TSR requires the following program elements to be addressed: shift operations; cascade operations organization and administration; chemical / utilities / power organization and administration; operator responsibility, Y authority, and shift routines; operations procedures, operator aids, and system !abeling; permits and logging; management monitoring of operations; and control of equipment.

The work force for the facility is divided into a day shift and four rotating shifts which provide continuous coverage of plant operations. The gaseous diffusion process operates continuously. The day shift works primarily Monday through Friday from 7:00 a.m. to 3:30 p.m.

_ The day shift provi des admiin strati ve support, activiti es such as desi gn and fabrication, procedure development, classroom training, planning, and preventive maintenance. Most of the plant staff works on the day shitt. The rotating shift organization has the prime

esponsibility for continued plant operation, exchange of information, and response to abnormal and unusual conditions to ensure safe operation of the facility. Typical activities include 16

4 8 providing oversight and direction for all plant operations, monitoring systems and equipment for proper performance, conducting routine back shift maintenance and emergency equipment -

repair, preparing equipment for day shift repair / preventive maintenance functions, and i responding to emergency situations. TSR 3.2.2 establishes appropriate minimum staffing levels for the plant. Overall staffing Mvels for the shif ts are not fixed but are based on the expected or planned activities. The average shift staffing on back shif ts is approximately 90.

l TSR 3.2.2 also' establishes overtime guidelines for staff who perform safety functions.

TSR 3.23 addressos worker protection for UFe hazards. USEC is required to establish, implement, and maintain worker protection measures to minimize the risk and mitigate the consequences of releases of UF., UF, reaction products with moist air, and other associated process chemicals.

There have been no substantive changes to the operations program since the initial certification. On this basis, the staff concludes that the operations program remains acceptable.

3.4 Training The regulations in 10 CFR 76.35(a)(5) require USEC to submit a " training program that meets the requirements of @ 76.95." According to 10 CFR 70.95, a training program must be

" established, implemented, and maintained for individuals relied upon to operate, maintain, or modify the GDPs in a safe manner. The training program shall be based on a systems approach to training."

USEC describes its training program in Section 6.6 of the SAR. By TSR 3.4, USEC is required to establish, implement, and maintain the program as described in the SAR. The training program at PGDP consists of a number of training e'ements, some of which utilize the systems approach to training and some that do not. Positions that are important to safety utilize the systems approach.

The PGDP training program addresses the necessary elements of a good program and meets the requirements of the regulations. The effectiveness of the program will be determined t'y how well it is implemented. There have been no substantive changes to the training program since the initial certification. On this basis, the staff concludes ; hat the training program remains acceptable.

3.5 Procedures Although a procedures program is not specifically required by the regulations, it is considered an essential part of the management controls and oversight program required by 10 CFR 76.35(a)(7) and by ASME NOA-1," Quality Assurance Program Requirements for Nuclear Facilities." USEC is committed to the use of approved and controlled written procedures to conduct nuclear safety, safeguards, and security activities for the protection of the public, plant employees, and the environment. Procedures prescribe the essential actions or steps needed to safely and consistently perform safety related activities. The procedure program is described

' in Section 6.11 of the SAR. TSR 3.9 addresses the procedure program.

).

17

Section 6.11.4.1 and Appendix A to Section 6.11 of the SAR describe the minimum activities that shall be covered by written procedures. Topics covered are administrative procedures; system procedures that address startup, operation, and shutdown; abnormal operation / alarm response; maintenance procedures that address system repair, calibration, inspection, and testing; emergency response; and any task that is described in, or implements a commitment that is described in the SAR, TSRs, and plans submitted with the application.

In Appendix B to Section 6.11 of the SAR, USEC has listed the specific subsections of ANS 3.2-1994," Administrative Controls and Quality Assurance for the Operational Phase of Nuclear Power Plants," that will be utilized in the procedure program. Procedures are developed or modified through a formal process. Procedure development, control, and use is a process that consists of nine ca3ic elements: identification, development, verification, rev;ew and comment resolution, approval, validation, issuance, change control, and periodic review. The PORC review is required for procedures required by TSR 3.9 and for intent changes to those procedures. All procedures are periodically reviewed to ensure continued accuracy and usefulness. Emergency, Operating, and Alarm Response procedures and procedures dealing with highly hazardous chemicals are reviewed on a 1-year cycle. All procedures designated as "In-Hand," which involve liquid UF handling activities, off-normal procedures, and Nuclear Material Control and Accountability procedures are reviewed on a 3 year cycle; all otner procedures are on a 5-year review cycle.

TSR 3.9 requires that written procedures shall be prepared, reviewed, approved, implemented, and maintained. The TSR covers the review and approval of procedures and allows for temporary changes. The procedure program as described in SAR Section 6.11 and the TSR is adequate. There have been no substantive changes to the procedures program since the initial certification. On this basis, the staff concludes that the procedures program remains acceptable.

3.6 Human Factors Human factors is not specifically addressed in the regulations. However, USEC has proposed a human factors program in SAR Section 6.7. PGDP incorporates human factors considerations in engineering design work associated with new equipment and facility modifications; preparation, validation, and use of procedures; and in development of training and qualifications of personnel who operate, maintain, or modify structures, systems, and components relied upon for safety. Human factors is considered in problem reporting and investigation. Human actions required by the TSRs to prevent or mitigate accidents are systematically evaluated for human factor considerations on a 3-year cycle, including accessibility, visibility, ergonomic capability, suitability of the environment for the required activity, and interferences. This program will result in human factors considerations for those actions important to safety. There have been no substantive changes to the human factors program since the initial certification. On this basis, the staff concludes that the human factors program remains acceptable.

3.7 Audits and Assessments An audit and assessment program is not specifically required by the regulations but is considered part of the management controls and oversight program required by 10 CFR 18 m

1 76.35(a)(7) and the quality assurance progre,n required by 10 CFR 76.35(d). PGDP has established a system of audits and assessments that is designed to ensure that the health, safety and environmental programs are adequate and effectively implemented. The Audit and Assessment Program is desenbed in SAR Section 6.8. TSR 3.5 requires USEC to implement the program described in the Quality Assurance Program (OAP) and the SAR. The program is designed to ensure comprehensive program oversight every 3 years.

There have been no substantive changes to the PGDP audit and assessment program since the initial certification. On this basis, the staff concludes that the audit and assessment program remains acceptable.

3.8 Quality Assurance The regulations in 10 CFR $76.35(d) and @76.93 require USEC to submit a quality assurance program (OAP) that satisfies "each of the applicable requirements of ASME NOA-1-1989" or

" acceptable alternatives to the applicable requirements." The regulations require USEC to

" execute the criteria in a graded approach to an extent that is commensurate with the importance to safety." USEC submitted the OAP with the application. The OAP establishes the minimum requirements for those items, activities, and services within the scope of the OAP.

USEC has committed in the OAP to meet the Basic Requirements and Supplementary Requirements of ASME NOA-1-1989 or has committed to alternatives acceptable to the NRC.

At initial certification, USEC identified an exception to the requirements of ASME NOA-1-1989 at Paducah related to the records storage vault. There are three conditions in the vault that do not conform to the ASME NOA-1 1989 requirements. These are: (1) the fire protection for the vault consists of pressurized water-filled sprinkler lines, (2) two roof drain lines which penetrate the vault, and (3) no floor drains. In order to prevent potential water damage, USEC has committed to provide a minimum of 6 inches of clearance to the bottom of the first shelf or drawer of any storage cabinet or shelving used in the vault. Additionally, the covered design of the mobile shelving system reduces the potential for water damage from leaking sprinkler heads or drain pipes. USEC conducted an engineering evaluation to show that use of the vault in its current configuration does not present an unacceptable risk in terms of potential water damage to records stored in the vault.

USEC has established a graded, OA Program for categorizing items and activities to which the applied level of quality would be in accordance with the relative importance to safety of the items and activities. Systems, structures, and components (SSCs) are categorized as O, AQ, or NS by Engineering. The AO category is further subdivided into an AQ-NCS category for SSCs relied upon for nuclear criticality safety, a category for structures important to safety, and a category for all other AO items and activities. The highest level of quality is applied to O and AQ-NCS SSCs with a lesser level applied to other AO SSCs. All other items and activities are designated as NS or non-safety. The current classification of SSCs is based on the existing accident analysis and engineering judgement based on the GDP operating experience. The SARUP discussed in Section 4.0 of this CER will provide criteria for determining O, AO and NS SSCs.

The requirements of the main body of the OAP applies to the O items and activities. Appendix A of the OAP defines the extent to which the OAP applies to AO items and activities. Appendix A, Section 1 describes the OA program for AQ-NCS items and activities required to meet the 19

double contingency principle. Appendix A, Section 2 describes the QA program for other AQ items and activities. Appendix A, Section 3 describes the QA program for AO structures. The formal OA program is not applied to NS items. Section 3.15 of the SAR lists the systems and boundaries for the O and AO items, except for AQ~NCS items. Boundary definitions for AQ-NCS SSCs are documented in a manual for each facility. These manuals are maintained on-site and are not part of the application. In accordance with TSR 3.22, the system boundary documents shall identify utilities required by the SSC to perform its safety function.

There have been no substantive changes to the OAP since the initial certification. On this basis, the staff concludes that the OAP remains acceptable.

3.9 Event Reporting and Investigations The regulations in 10 CFR 76.120 and other applicable sections referenced in 10 CFR 76.60 l identify the reporting requirements for the GDPs. The PGDP Event Reporting and Investigation J Program is described in Section 6.9 of the SAR. In addition to the requirements for oral notifications and written reports, USEC is required to determine root causes, adequate corrective actions, and lessons learned. l i

The staff still has two outstanding questions related to the 76.68 changes made by USEC in I Revision 24 which was submitted on April 15,1998. The questions concern when an i investigation will be conducted for an event and when corrective actions will be developed for an event. USEC revised the language to indicate that an investigation will be conducted and corrective actions developed to address the root cause(s) for each event where a written report is required to be provided to the NRC. The previous language required these activities to be ,

conducted for each event where NRC was notified. Some events that are reported to the NRC l do not require a written report, however, these events still warrant an investigation into the i cause of the event. USEC has indicated that the intent of the language change was not to I l _ eliminate the investigation and corrective action requirements for events that do not require a l l written report. The plant continues to conduct the appropriate investigations and develop I

! corrective actions for those events. For this reason, the staff does not consider that these I i i issues need to be resolved for the renewal. However, to ensure that USEC resolves these issues in a timely manner, the staff plans to include the following condition:

l-The United States Enrichment Corporation shall conduct an investigation for each reportable event and develop corrective actions for each event or condition

, requiring NRC notification. USEC shall revise Sections 6.9.4 and 6.9.6 of the Paducah Safety Analysis Report to reflect these actions within 90 days of the renewal.  ;

r If USEC resolves the issue prior to the renewal, the staff will not include this condition in the l' Certificate of Compliance. There have been no other substantive changes to the event I i

[ aThe staff has determined that USEC's application revision 31, dated November 6,1998, I

adequately modifies its Event Reporting and Investigation Program in SAR Section 6.9. As I i such, this proposed condition is not included in the Certificate of Compliance for the renewal. I

i. 20 r

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reporting and investigations program since the initial certificatiort On this basis, the staff concludes that the rest of the event reporting and investigations progam remains acceptable. l 3.10 Record Management A records management program is not specificall/ required by the regulations, however it is considered part of the management controls and oversight program required by 10 CFR 76.35(a)(7) and a necessary part of the OAP. The PGDP Records Management and Document Control (RMDC) Programs are described in SAR Section 6.10. TSR 3.24 addresses the record retention program. There have been no substantive changes to the RMDC Program since the initial certification. On this basis, the staff concludes that the RMDC program remains acceptable.

3.11 Maintenance The regulations in 10 CFR 76.87 require the TSRs to address maintenance. The description of the PGDP Maintenance Program is contained in Section 6.4 of the SAR. By TSR 3.15, USEC is required to establish, implement, and maintain the program. The program addresses both corrective and preventive maintenance. The Maintenance Program is conducted in a graded approach commensurate with safety.

There have been no substantive changes to the maintenance program since the initial certification. On this basis, the staff concludes that the maintenance program remains acceptable.

3.12 Configuration Management The regulations in 10 CFR 76.68 require USEC to " maintain records of changes in the plant and of changes in the programs, plans, policies, procedures and operations doncribed in the approved application, and copies of the safety analyses on which the changes were based."

This is accomplished via the Configuration Management Program whic 1 is described in Section 6.3 of the SAR. The Configuration Management Program is used to ccatrol changes and maintain the plant configuration to ensure accurate, current design documentation that matches the plant's physical configuration while complying with applicable requirements.

There have been no substantive changes to the configuration management program since the initial certification. On this basis, the staff concludes that the configuration management program remains acceptable.

3.13 Management Controls The regulations in 10 CFR 76.35(a)(7) require the SAR to contain a " description of the management controls and oversight program to ensure that activities directly relevant to nuclear safety and safeguards and security are conducted in an appropriately controlled manner that ensures protection of employee and public health and safety and protection of national security interests." USEC and LMUS have established management systems with associated policies, administrative procedures, and management controls to ensure protection of the health and 21

l safety of workers and the public, protection of the environment, and for the common defense l and security. Management Systems and Programs are described in Chapters 5 and 6 of the SAR, the TSRs, and in the Program Plans.

l Precedirig sections of this Compliance Evaluation Report (CER) mentioned many of the programs that come under the consideration of management controls. Primary among these l

are an organizational structuro that has clear assignment of responsibilities and independent reporting chains for the safety functions, PORC, quality assurance (QA), a configuration management program, an audit and assessment program, and an investigation and reporting ]

process. The PORC provides the necessary review for management to make informed decisions. The Audit and Assessment Program provides assurance that programs are being l implemented in accordance with regulations and procedures. A QA Program is in place to l promote safe, reliable, and efficient plant operation. PGDP investigates incidents to determine root cause and lessons learned. Items from the lessons learned are integrated into the  ;

procedures and training programs as appropriate. PGDP has a commitment tracking and l corrective action management system that prioritizes plant actions consistent with their safety l and safeguards significance. These items along with a procedures and training program, a maintenance program, the configuration management program, and other programs will provide )

l the necessary tools for USEC to operate in a safe, reliable fashion. It is apparent from the staff l l

inspection reports that operations at PGDP still experience some problems in the area of 1 management controls. Compliance Plan issues dealing with management controls have now )

l been completed. These activities will continue to be closely followed by the NRC staff to ensure that the programs are being effectively implemented.

4.0 FACILITY AND PROCESS DESCRIPTION l

The regulations in 10 CFR 76.35(a)(8) require USEC to provide a " description of the principal structures, systems, and components of the plant." Chapter 3, " Facility and Process Description," of the SAR provides the facility and process description. The staff is aware that  !

the descriptions contained in Chapter 3 may not match the "as found" condition of the facility in l allinstances. USEC is in the process of reviewing, updating, and confirming the information contained in SAR Chapter 3. This effort will continue over the next year and is discussed further in the following paragraphs. The information contained in Chapter 3 of the SAR was not reviewed as part of the renewal effort.

SAR Uoarade Compliance Plan issue 2 addressed the SAR upgrade. The SAR submitted as part of the initial certification application was based, in part, on the 1985 Final Safety Analysis Report (FSAR).

The FSAR had a number of areas which needed to be updated with respect to the description of hazards, description of SSCs, human activities, and supporting safety analyses. DOE was stillin the process of updating the FSAR at the time of initial certification. The SAR upgrade was to provide comprehensive analysis of all credible initiating events and the consequences from these accidents to more clearly define the technical basis for safety boundaries.

Compliance Plan Issue 2 captured this issue and required USEC to submit an amendment that addressed the SAR upgrade by August 17,1997.

USEC submitted a portion of the SAR Upgrade (SARUP) on August 18,1997. On October 31, 1997, USEC submitted the remaining portions of the SARUP, with the exception of Chapter 3.

22 i

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! The proposed accident analysis (Chapter 4) is completely revised with new and revised proposed TSRs that are based on th* new analysis. The staff review of the SARUP is ongoing.

Neither USEC's nor DOE's efforts in response to Compliance Plan Issue 2 included a systematic review, update, and confirmation of the information contained in SAR Chapter 3. By its August 18,1997, letter, USEC committed to performing a systematic review, update, and l

l confirmation of the information contained in SAR Chapter 3 and to make necessary changes to

! the SARUP analyses and supporting documents by no later than October 31,2000.

Confirmation of the SARUP Chapter 3 information would involve field walkdowns and document reviews. By letter dated March 30,1998, USEC provided the priority levels for the review and the schedule for the Chapter 3 revisions. By separate letter dated March 30,1998, USEC l

requested an amendment to add a new condition to Certificate of Compliance GDP-1 to require the review, update, and confirmation of the information in SAR Chapter 3. The request would require USEC to submit the necessary changes to NRC by October 31,1999, and make the necessary and related changes to the SARUP by October 31,2000.

For updating SARUP Chapter 3, USEC has proposed six priority levels, with Level 1 being the highest priority and therefore the first worked and Level 6 being the lowest priority and therefore the last worked. Priority Level 1 would consist of Q SSCs with the focus on those systems with automatic actions or features that prevent, mitigate or contain a major release with significant l off-site consequences. Level 2 would consist of Q, AQ-NCS, and AQ SSCs that have passive design features that mitigate off-site consequences, active featurcs that mitigate onsite or local worker consequences, or alarm functions that provide for operator actions to mitigate accident conditions or reduce accident consequences. Priority Level 3 would consist of AQ-NCS and AQ SSCs that have lesser involvement in hazard or accident mitigation. Level 4 would consist of AQ-NCS and AQ SSCs that are secondary contributors to hazard or accident mitigation. Level 5 would include facility structures, on-site and off-site warning systems, and other AQ SSCs that have limited consequences associated with their failure. Level 6 would include AQ SSCs used for inventory, SSCs that provide event information, SSCs that are specific to on-site protective features, or currently inactive SSCs. Use of this prioritization will provide for those systems relied upon to prevent or mitigate postulated accidents that have the highest source terms and consequences to be completed first. The staff finds this prioritization acceptable.

Individual milestones for completion of the six levels are completion of Priority 1 SSCs by September 3,1998, Priority 2 SSCs by December 3,1998, Priority 3 SSCs by March 4,1999, Priority 4 SSCs by May 6,1999, Priority 5 SSCs by July 8,1999, and Priority 6 SSCs by September 2,1999. USEC has recently informed the NRC that the first milestone date has slipped, however, all changes will be submitted to the NRC by the completion date of October 31,1999. The NRC expects USEC to inform it of those changes that significantly impact the accident assumptions and consequences and those that potentially affect the TSRs. As part of the amendment process, the staff will review the criteria to be proposed by USEC for determining when the NRC will be informed of significant changes. The staff's amendment review is ongoing.

5.0 ACCIDENT ANALYSIS The regulations in 10 CFR 76.35(a)(4) require the SAR to include an " assessment of accidents based on the requirements of @76.85." A " reasonable spectrum of postulated accidents which 23

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e. l

. include internal and external evats and natural phenomena" is to be considered in the accident analyses. Chapter 4 of the SAR contains the PGDP accident analysis. By TSR 3.20, USEC is >

l required to make changes to the accident analysis in accordance with the plant design change l control process described in SAR Section 6.3. The SAR is based, in part, on the 1985 FSAR ,

l and approved safety evaluations performed for plant operations during the intervening time  !

l period. At the time of the initial certification, the staff had reviewed and approved the accident l analysis with the understanding that a site-wide safety analysis upgrade effort was ongoing. >

This effort was captured by Compliance Plan Issue 2. USEC has submitted the SARUP I amendment that addresses the results of the upgrade effort. The staff is currently reviewing l the SARUP amendment as a separate action, therefore, as part of the renewal process, the l l staff did not review Chapter 4, " Accident Analysis again. i G.0 TECHNICAL SAFETY REQUIREMENTS The regulations in 76.35(e) require the application to contain " Technical Safety Requirements in accordance with $76.87." The regulations further require a basis statement for the requirement l to be part of the application, but not part of the TSR. The TSRs were to consider the i information from the SAR and contain appropriate references to established procedures and/or l equipment to address the 14 topics listed in 76.87(c). The TSRs are to include safety limits, limiting control settings, limiting conditions for operation, design features, surveillances, and administrative controls as appropriate. The TSRs are contained in volume 4 of the application.

TSR 3.6 requires USEC to control the TSR Basis statements in accordance with the plant change control process described iri Section 6.3 of the SAR.

The TSRs consist of facility-specific and equipment-specific TSRs and administrative TSRs.

Section 1 contains TSRs related to use and application and includes definitions, time intervals for surveillances, intent of terms, and applicability statements. Section 2 contains the facility-specific TSRs, including TSRs on the autoclaves, UF, detection systems, criticality accident  ;

alarm systems, cylinder handling, cylinder filling, cylinder heating, the fire protection system, and other process-related equipment. ' Section 3 contains the TSRs related to administrative controls, including responsibility assignment, the organization, staffing, PORC, procedures, l

training, criticality safety, and commitments to the radiation protection, fire protection, chemical safety, environmental protection, radioactive waste rnanagement, and maintenance programs, as well as the other topics required by the regulations.

Section 1 of the TSRs !s the use and application section. Appropriate definitions are provided  ;

by TSR 1.2.1 through TSR 1.2.17. TSR 1.3 defines acceptable time intervals for surveillance

'(i.e., biennial surveillances could be conducted up to 2 years 6 months). Acronyms and intent of terms (shall, should, may) are covered by TSRs 1.4 and 1.5 respectively. Applicability j statements for safety limits (1.6.1), operating limits (1.6.2), surveillance requirements (1.6.3),

and conditions outside TSRs (1.6.4) are provided. The wording for these are similar to the WSTS and are acceptable.

Section 3 of the TSRs contains the administrative controls. TSR 3.17 commits USEC to the 4 packaging and transportation quality assurance program that is described in the NRC-approved version of UEO-1041," Radioactive Material Packaging and Transportation Quality Assurance Program." The staff approved the packaging and transportation quality assurance program by letter dated March 21,1996. TSR 3.21 states that USEC is not dependent upon outside agencies to provide the level of safety described in the TSR and that USEC controls the 24 l

l

facilities, structures, systems, and components that are relied upon in the TSRs. All of the other safety topics that 76.87(c) required to be addressed by the TSRs have been addressed by USEC and are discussed in other chapters of this CER. &

The staff has reviewed a portion of the TSRs for the Paducah facility in conjunction with the renowal application; those TSRs in TSR Sections 1 and 3 were reevaluated for acceptability. '

The facility-specific TSRs contained in TSR Section 2 were not reevaluated. No changes were identified that invalidated the conclusions from the initial certification. The SAR upgrade project has resulted in the identification of new safety systems and TSRs; it has also resulted in the elimination of carrent safety systems and a recommendation to eliminate some of the TSRs.

USEC has submitted revised TSRs with the SARUP amendment; these revised TSRs will need to be evaluated based on the new information in the SARUP. This review is ongoing and is part of a separate action. The TSRs contained in the application continue to establish the necessary controls and provide the necessary program commitments for the facility.

USEC has been allowed to make changes to the TSR basis statements without prior staff approval, but has not been allowed to make changes to the TSRs themselves without prior staff approval. The initial Certificate of Compliance contained a condition to impose the TSRs on USEC. In order to continue to impose the TSRs on USEC, the staff plans to include the following condition:

The United States Enrichment Corporation shall conduct its operations in accordance 'with the Technical Safety Requirements that are contained in Volume 4, Revision 27 of the Application. Changes to the Technical Safety Requirements shall require NRC approval prior to implementation.

7.0 RADIATION SAFETY The regulations in 10 CFR 76.60(d) require USEC to comply with the applicable provisions of 10 CFR Part 20. In accordance with 10 CFR 20.1101, USEC is required to develop, document, and implement a radiation protection program commensurate with the scope and extent of activities to ensure compliance with the provisions contained in Part 20. The PGDP radiation protection program is described in SAR Section 5.3. TSR 3.13 requires USEC to establish, implement, and maintain the program described in the SAR. The TSR also requires the following elements to be addressed in the program: health physics technicians training and qualifications, personnel exposure control and measurement, contamination control, radioactive material control, radiological protection instruments and equipment, and records and reports.

The PGDP radiation protection program involves the entire range of facility operations which could affect worker safety pertaining to radioactive material in normal operations or during accident conditions.

USEC continues to request an exemption from 10 CFR Part 20 requirements related to labeling containers. Title 10 CFR 20.1904 requires each container of radioactive material be labeled I such that the radionuclide(s) including their estimated quantities, radiation levels, enrichment, and forms are identified. USEC states that it is impractical to label every container located in Radiation Areas. Instead, USEC has proposed to place one caution sign in the area stating that every container may contain radioactive material. In addition, USEC is committed to 25

l surveying all containers removed from contaminated or potentially contaminated areas to l

ensure that contamination is not spread around the plant site. As part of this exemption, USEC l also wants relief from labeling of UF, cylinders per 10 CFR 20.1904, since these cylinders are l l readily identifiable. Alternatively, USEC has proposed to have UF, cylinders constantly 1 l . attended by qualified radiological workers during movement. The staff finds the on-site radiological safety ~ impacts that could result from this exemption to the requirements of 10 CFR l 20.1904 to be minimal and the alternatives proposed by USEC to be acceptable and therefore  !

concludes that this exemption should be continued. l l There have been no substantive changes to the radiation protection program since the initial i certification. On this basis, the staff concludes that the radiation protection program remains acceptable.

. 8.0 NUCLEAR CRITICALITY SAFETY 1

The regulations in 10 CFR 76.87(c)(3) require the TSRs to address criticality prevention. In addition,10 CFR 76.89 requires USEC to maintain and operate a criticality monitoring and audible alarm system. The nuclear criticality safety (NCS) program is also part of the management controls and oversight necessary to protect the public health and safety required by 10 CFR 76.35(a)(7). The NCS program is described in Section 5.2 of the SAR and required by TSR 3.11.

TSR 3.11 establishes the foundation for the NCS program. USEC is required to establish, implement, and maintain the program as described in the SAR. The TSR further requires the NCS program to address the following elements: adherence with ANSl/ANS standards, NCS responsibilities, process evaluation and approval, design philosophy and review, criticality accident alarm system coverage, procedure requirements, posting and labeling requirements, change control, operation surveillance and assessment, and technical aspects. The TSR requires all operations involving uranium enriched to 1.0 wt % or higher and 15 g or more of ,

easU to be based on a documented NCS evaluation and to be performed in accordance with an NCS approval. The TSR sets the minimum margin of subcriticality of 0.02 in kg and a k,n of s 0.9634 (including the bias, uncertainty, and the margin of subcriticality) for all criticality calculations. The TSR further requires the double contingency principle to be used as the basis for design and operation of processes using fissionable materials; for those instances where double contingency is not met, TSRs shall be established, implemented, and maintained to prevent criticality from occurring. The staff concludes that this TSR sets an acceptable foundation for the NCS program. PGDP has committed to ANSI /ANS 8.1-1983," Nuclear Criticality Safety in Operations with Fissionable Materials Outside Reactors"; ANSI /ANS 8.7- l 1975," Guide for Nuclear Criticality Safety in the Storage of Fissile Material"; and ANSI /ANS 8.19-1984, " Administrative Practices for Nuclear Criticality Safety."

There have been no substantive changes to the NCS program since the initial certification. On this basis, the staff concludes that the NCS program remains acceptable.

The regulations require a criticality monitoring and audible alarm system in all areas of the

facility. The regulations (10 CFR 76.89(a)) also allow USEC to request approval to exclude areas from the monitoring requirement. By letter dated April 19,1996, as revised by letter I

26

i dated August 15,1996, USEC submitted a request to exclude areas from the monitoring requirement. Areas covered by the request include facilities or portions of facilities that contain less than 15 grams 23sU, facilities or portions of facilities that contain uranium enriched to less '

than 1 wt % 235U, UF, cylinder storage yards, certain waste storage areas, the C-726 sandblast facility, and the C-712 Acid Neutralization Pit. These areas were not covered by a CAAS under -

DOE. The staff is still reviewing the USEC exclusion request and plans to complete the review ,

by the end of the year. In the interim, the staff acknowledges that the areas subject to the request do not have CAAS coverage, if the staff determines that CAAS coverags is required for any area covered by the exclusion request, the staff will work with USEC to establish a schedule for installation of a monitoring system via the PGDP Compliance Plan.

9.0 ENVIRONMENTAL PROTECTION AND WASTE MANAGEMENT The regulations in 10 CFR 76.60(d) require that USEC comply with the applicable provisions of l 10 CFR Part 20. USEC describes its radiological environmental program in Section 5.1 of the SAR. By TSR 3.16, USEC is required to establish, implement, and maintain the program i described in the SAR. The Radioactive Waste Management Program is required by TSR 3.14.

The environmental program includes a system of process and administrative controls to prevent releases above regulatory limits and to maintain effluents ALARA. TSR 3.8 requires USEC to control emissions as described in SAR Section 5.1.

The facility meets the dose limitations contained in the regulations. USEC has also established an acceptable environmental monitoring program that includes collection of ambient air, external gamma radiation, vegetation, soil, sediment, and water samples. There have been no substantive changes to the environmental protection program since the initial certification i review. On this basis, the staff concludes that the environmental protection program remains acceptable. j The regulations in 10 CFR 76.35(g) require USEC to submit a " compliance status report that includes the status of various State, local and Federal permits, licenses, approvals, and other i entitlements, as described in @ 51.45(d) of this chapter. The report must include environmental and effluent monitoring data " As part of the annual update to the application, USEC submitted f an updated Environmental Compliance Report. The Environmental Compliance Report contained information on the environmental permits issued to the facility, including the principal i permit limits, a summary of monitoring and emissions / effluent data for each permit, and a summary statement on the status of USEC compliance. USEC also provided a summary of the data from the environmental monitoring program. The report contained the requ' ired information. On this basis, the staff concludes that the Environmental Compliance Report is acceptable.

The regulations in 10 CFR 76.35(c) require the application to contain "any relevant information ,

concerning deviations from the published Environmental Impact Statement, Environmental Assessments, or environmental permits under which the plants currently operate from which the Commission can prepare an environmental assessment related to the compliance plan." To meet this requirement USEC submitted, as part of the initial certification, a report called Supplemental Environmental Information. The information in this report and other information

- ~ .n, - . - - , . , .-., -- r, ,-. - , ~ n ,

= _ _ . . - -- -

i

• i -

l in the application was used in preparation of the staff's environmental assessment to support approval of the Compliance Plan associated with the initial certification. The report met the requirements of the regulation. In April 1998, USEC provided an update to the information to reflect that all of the Compliance Plan actions that could potentially cause adverse impact to the :

environment had been completed.

The regulations in 10 CFR 76.35(m) require "a description of the program, as appropriate, for processing, management, and disposal of mixed and radioactive wastes and depleted uranium generated by operations." To meet this requirement, USEC submitted two plans: the Radioactive Waste Management Plan and the Depleted Uranium Management Plan.

There are several potential uses for depleted uranium that are being investigated by both USEC and DOE. However, for planning purposes, USEC is still assuming that the ultimate disposition strategy for the remaining inventory will consist of converting the solid ufo to U3 0, using the pyrohydrolysis process in which the UF, will be converted into a gas and combined with steam.

The UF, gas will react with the steam to form UO2 F 2 which is then converted to U 3 0,in high temperature calciners. The U 30, would then be packaged and shipped to an authorized repository. This approach remains acceptable to the staff. In July 1998, USEC updated the depleted uranium tails quantity for which it is responsible. DOE is responsible for all tails generated prior to July 28,1998.

l The USEC Radioactive Waste Management Plan and the Depleted Uranium Management Plan adequately describe the programs for handling the wastes and depleted uranium generated by operations. There have been no substantive changes to these plans since the initial i certification, other than the change to the quantity of depleted uranium tails for which USEC is responsible. On this basis, the staff concludes that the plans remain acceptable.

10.0 CHEMICAL SAFETY The regulations in 10 CFR 76.87 require the TSRs to address chemical safety. Chemical safety includes the chemical hazards derived from radioactive materials and plant conditions related to the hazards of chemicals on or near the site that may directly or indirectly affect radiation risk. TSR 3.18 requires USEC to establish, implement, and maintain a chemical safety program as described in the SAR. Section 5.6 of the SAR describes the Chemical Safety Program at PGDP.

There have been no substantive changes to the chemical safety program since the initial certification. On this basis, the staff concludes that the chemical safety program remains acceptable.

11.0 FIRE PROTECTION The regulations in 10 CFR 76.35(a)(6) require the SAR to include a " description of equipment and facilities which will be used by the Corporation to protect health and minimize danger to life or property" such as " fire protection systems." The PGDP fire protection program is described l in Section 5.4 of the SAR. TSR 3.12 requires the establishment, implementation, and maintenance of the fire protection program.

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1 a '

The fire protection manager initiated a'walkdown of the entire fire protection sprinkler system i in the process buildings after repeat problems were identified early in 1997. The walkdown was

conducted by plant fire department personnel and consisted of floor level observation and . I documentation of anomalies associated with each sprinkler system and branch line. The l documented anomalies were reviewed and dispositioned by a fire protection engineer. The j anomalies included both old design and installation deficiencies, as well as National Fire  !

Protection Association code inconsistencies. Plant staff identified, responded promptly, and l corrected fne problems, i There have been no substantive changes to the fire protection program since the initial certific.ation. On this basis, the staff concludes that the fire protection program remains t acceptable.

12.0 EMERGENCY PREPAREDNESS The regulations in 10 CFR 76.35(f) require USEC to submit an " emergency plan that meets the i requirements of 676.91." Section 76.91 describes the type of information to be included in the Emergency Plan. USEC submitted an Emergency Plan for the PGDP with the application.

l TSR 3.7 requires USEC to establish, implement, and maintain emergency response procedures i to prescribe plant response to natural phenomena.  ;

There have been no substantive changes to the Emergency Plan since the initial certification.

On this basis, the staff concludes that the Emergency Plan remains acceptable.

13.0 SECURITY AND SAFEGUARDS 13.1 Material Control and Accounting  ;

The regulations ir.10 CFR 76, Subpart E require USEC to meet specific requirements within ,

Parts 70 and 74 for material control and accounting for Category 1, Category 11, and Category 111 i special nuclear material (SNM). The PG,0P possession limits for special nuclear material of low .

strategic significance (SNM-LSS) are such that only safeguards requirements for Category 111  !

SNM-LSS apply to USEC activities at this plant. Specifically, USEC must comply with the applicable requirements of 10 CFR SS 70.51,74.11,74.13,74.15,74.17,74.33,74.81, and 74.82.

The NRC recognizes that USEC may opt to engage in production or nonproduction activities  ;

that involve other than Category ill material. In that event USEC must apply for and be certified by the NRC as meeting the applicable safeguards regulations in accordance with the category of material that it seeks to either possess and use or possess only.  ;

USEC must implement an NRC-approved Fundamental Nuclear Material Control (FNMC) Plan pursuant to 10 CFR 74.33(b)(2), achieve the general performance objectives of 10 CFR 7.4.33(a), maintain the system capabilities required by 10 CFR L.33(c), and establish records ,

which comply with the record keeping requirements of 10 CFR /4.33(d)(1). Guidance for i preparation of an FNMC Plan is provided in Regulatory Guide 5.67, " Material Control and  !

- Accounting for Uranium Enrichment Facilities Authorized to Produce SNM of Low Strategic ,

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E

Significance," and in NUREG/CR-5734, " Recommendations to the NRC on Acceptable

, Standard Format and Content for the FNMC Plan Required for Low-Enriched Uranium Enrichment Facilities."

As part of the application, USEC submitted the " Fundamental Nuclear Material Control Plan" for the Paducah f acility; because of its nature, this plan is not publicly available. The plan describes how the PGDP facility will meet applicable NRC material control and accounting requirements. As part of the initial certification, the staff concluded that the FNMC Plan for the PGDP satisfied the performance objectives and system capabilities required by the regulations.

There have been no substantive changes to the FNMC Plan since the initial certification. On this basis, the staff concludes that the FNMC Plan remains acceptable.

13.2 Physical Security and Transportation Protection The regulations in 10 CFR Part 76, Subpart E requires USEC to meet specific requirements within Parts 70 and 73 for physical protection of Category 1 Category ll, and Category lil SNM.

Specifically, USEC must comply with the applicable requirements of 10 CFR 73.67,73.71, and 73.74.

The NRC recognizes that USEC may opt to engage in production or nonproduction activities that involve other than Category lll material. In that event, USEC must apply for and be certified by the NRC as meeting the applicable safeguard regulations in accordance with the category of material that it seeks to access, use, or possess.

USEC must meet the general performance objectives of 10 CFR 73.67(a), submit a physical security plan per 10 CFR @ 73.67(c), and comply with the measures for physical protection of SNM-LSS as required by @ 73.67(f) at plant sites and (g) for SNM-LSS in transit. Guidance for preparation of the physical protection plans and the transportation protection plans by USEC is provided in Regulatory Guide 5.59, Revision 1, " Standard Format and Content for a Licensee Physical Security Plan for Protection of Special Nuclear Material of Moderate or Low Strategic Significance," February 1983.

As part of the application for the PGDP, USEC submitted the Physical Security Plan and the Transportation Security Plan; because of their nature, these plans are not publicly available.

USEC has committed in the Physical Security Plan and the Transportation Security Plan for PGDP to implement procedures and measures to comply with the requirements of 73.67(f) and (g).

USEC has chosen not to address or to commit to physical protection of export and import shipments of SNM LSS in the Paducah Transportation Security Plan. Therefore, USEC can not import to or export SNM-LSS from the PGDP until the NRC staff has reviewed and found acceptable an amendment to the Paducah Transportation Security Plan to address requirements for import and export shipments of this material to and from this site.

There have been no substantive changes to the Physical Security Plan or the Transportation Security Plan since the initial certification. On this basis, the staff concludes that the Physical Security Plan and Transportation Security Plan for the PGDP satisfy the performance objectives

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and system capabilities required by the regulations, meet the regulatory requirements for physical protection of SNM-LSS both at this site and during domestic shipment to and from this site, and remain acceptable. ,

l 13.3 Classified Information l The regulations in 10 CFR Part 76.60(l) requ!re USEC to comply with the requirements of 10 CFR Part 95, " Security Facility Approval and Safeguarding of National Security Infermation and Restricted Data," in order to use, process, store, reproduce, transmit, transport, or handle National Security Information and/or Restricted Data in connection with NRC-related activities.

Additionally, in December 1993, the Chairman of the NRC and the Secretary of Energy signed a Joint Stetement of Understanding on implementing the Energy Policy Act provisions on the reguNtion of gaseous diffusion uranium enrichment plants. Paragraph No. 4 of the Joint '

Statement of Understanding states that " DOE will be responsible for the administrative determinations relating to granting, suspending, adjudicating, or denying a security clearance, and for reinvestigating an individual's background for continued access." USEC must also comply with the guidelines set forth in the Joint Statement of Understanding between DOE and the NRC.

As part of the application, USEC submitted the " Security Plan for the Protection of Classified Matter" for the Paducah facility; because of its nature, this plan is not publicly available. USEC has made commitments which meet the requirements of 10 CFR Part 95 by providing an acceptable security plan that establishes controls to ensure that classified matter is used, stored, processed, reproduced, transmitted, transported, and destroyed only under conditions that will provide adequate protection and prevent access by unauthorized persons.

NRC conducted a security inspection at the Paducah plant in May 1997. The inspection found >

that USEC was not fully implementing a significant number of specific requirements of the Security Plan and had failed to provide complete and accurate information regarding certain aspects of the Security Plan. The inspectors also determined that plant personnel were not familiar with commitments found in the Security Plan. USEC took immediate corrective action to review the Security Plan, as well as the Physical Security Plan and the Transportation Security Plan, for accuracy, consistency, completeness, and proper implementation. USEC revised the plans to correct the deficiencies that were discovered during the review.

Another issue involving security was the discovery of classified documents that were being improperly controlled, in response, PGDP staff undertook a comprehensive review of all areas of the plant to remove any classified documents that were being improperly controlled and to place the documents under proper control. This effort resulted in the discovery of several documents that were being improperly controlled. The plant has completed the review effort.

The NRC staff concludes that the security plan for the protection of classified matter at the PGDP continues to be acceptable in meeting the requirements of 10 CFR Part 95.

14.0 DECOMMISSIONING The regulations in 10 CFR 76.35(n) require that USEC submit "a description of the funding program to be established to ensure that funds will be set aside and available for those aspects 31

l of the ultimate disposal of waste and depleted uranium, decontamination and l , decommissioning." These regulations further state that "the Corporation shall establish l financial surety arrangements to ensure that sufficient funds will be available for the ultimate disposal of waste and depleted uranium, and decontamination and decommissioning activities j which are the financial responsibility of the Corporation."

l As part of the application USEC submitted a Decommissioning Funding Program Description. It i addresses the scope of USEC's financial responsibility for decommissioning, a cost estimate  !

and basis, and the funding mechanism.

l Under the lease agreement with DOE and the Energy Policy Act, USEC is not responsible for the decontamination and decommissioning of the leased premises. DOE retains responsibility for the decommissioning, including decommissioning of any capital improvements (i.e., new buildings or equipment). USEC is financially responsible for the disposal of low-level radioactive waste and mixed waste generated by USEC and for the cost for disposition of the depleted uranium generated from the enrichment process. DOE retains liability for depleted uranium generated before USEC's privatization per the USEC Privatization Act.

The disposition of the depleted uranium tails is the major factor for estimating decommissioning l costs. The total unit cost for the disposition of depleted uranium is estimated to be $5.27 per I l

kilogram of depleted uranium ($4 per kilogram of uranium for conversion to U3 0s, $1 per  !

kilogram of U3 0, for disposal, and S0.27 per kilogram for transportation.) When escalated for I inflation through the end of fiscal year 1999, the average cost is $5.75 per kilogram. The staff finds this estimate to be reasonable. A factor in USEC's future liability is the fact that DOE will l be responsible for the ultimate disposition of the depleted uranium. Once DOE determines how I it will disposition the tails, the staff will consider imposing that cost basis on USEC. USEC )

ostimates that approximately 84,354 metric tons of depleted uranium will be generated by the Paducah and Portsmouth operations from October 1,1997, through September 30,2005, in accordance with the " Memorandum of Agreement Between the United States Department of i Energy and the United States Enrichment Corporation Relating to Depleted Uranium," dated l June 30,1998, USEC will transfer depleted uranium to DOE in fiscal years 1999 through 2005.

Therefore, USEC will only be responsible for the disposition of 56,100 metric tons of depleted l l

uranium through June 30,2005.

The estimated cost for the disposal of waste and for the disposition of depleted uranium at the PGDP for the first fiscal year of privatization is $38.4 million. USEC has submitted an executed l Payment Surety Bond and Standby Trust Agreement to establish the financial arrangements to ensure that sufficient funds will be available to cover the first year of operations of the privatized corporation. USEC has also committed to review the decommissioning cost estimates and associated funding levels in July of each year. USEC will adjust the estimated costs and funding lavel as necessary. The adjustments will take into account such factorc as changes in volume and cost estimates, inflation, changes in plant condition, and changes in expected decontamination and decommissioning procedures. However, the proposed certificate renewal period will be for a 5-year period and not a 1-year period. Therefore, to ensure that the funding levelis adjustdd each year of the renewal period, the staff plans to include the following condition: \

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The United States Enrichment Corporation shall review the decommissioning cost estimates and associated funding levels in July of each year and adjust the estimates and funding levels as necessary. If USEC determines that the existing .

financial instruments do not adequately cover the adjusted decommissioning ,

I cost estimate, USEC shall submit financial instruments to cover the new cost estimates by September 30th of each year.

USEC may at its option submit financial instruments that ensure sufficient funding to cover the i entire period covered by the certificate. l 15.0 COMPLIANCE PLAN As part of the initial certification, the NRC reviewed and approved the Compliance Plan, a plan for bringing areas into compliance where the plant is not fully in compliance with NRC regulations. It contains a description of the areas of noncompliance, a plan of actions and schedules for achieving compliance, and a justification for continued operations which addresses the adequacy of safety, safeguards, and security considerations. The Paducah plan contained 53 issues. USEC has identified all but four of the issues as completed. The NRC has asked USEC to develop criteria to validate completion of Compliance Plan issues. The NRC will continue to inspect the completion of a sample number of Compliance Plan iterns #

during future inspections. The four issues currently identified as open are discussed below.

Issue 27. Procedures Proaram This issue deals with the procedures program. USEC has completed all but one item. The TSR on procedures (TSR 3.9)is being fully implemented. USEC has completed the development of the new or updated procedures necessary under this issue. The overdue periodic reviews have been completed. The only item remaining is for the PORC to review all procedures designated as In-Hand and procedures that involve liquid UF, handling activities by March 2002. This commitment only pertains to those procedures which would not otherwise be reviewed by PORC before the due date.

Issue 36. Seismic Capability of Buildinas C-331 and C-335 During the SAR upgrade project, DOE identified structural weaknesses in two of the main process buildings. Structural seismic loading capacity analyses indicated that significant structural damage could occur at peak ground acceleration levels below those for the 250-year return period, starting at peak ground acceleration levels above 0.05g. Buildings C-331 and C 335 were the affected buildings. At peak ground acceleration levels above 0.05g, buildings C-331 and C-335 could suffer collapse of 20-foot wide sections of the roof and all floor levels above ground. These sections traverse each building in three places. USEC is to modify buildings to strengthen building structures and increase the seismic capacity of the floor and roof sections to withstand a 0.16 g seismic event. The modifications are to be complete by June 30,1999. The original completion date was December 31,1997. However, USEC submitted an amendment to resolve three unreviewed safety questions associated with the modifications and a request to delay the modifications. The staff approved the resolution of the three questions but denied the delay instead recommending a June 30,1999, completion date. I 33 i

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USEC has recently informed the staff that the modifications are behind schedule and that the

, due date will probably not be met. USEC is currently evaluating the situation and may request an amendment.

Issue 46. Criticality Accident Alarm System - Horn Audibility There are areas in the process buildings where the criticality accident alarm system (CAAS) horns are not audible to personnel due to the high ambient noise levels. The inaudibility does not effect the capability of the CAAS to detect a criticality accident. Interim measures such as the building howlers and public address announcements are used to warn personnel. The plant modifications to ensure that the CAAS alarm horns are capable of being heard throughout the affected areas of the process buildings are to be complete by December 15,1998. USEC has informed the staff that this issue is behind schedule and that it plans to submit an amendment to revise the due date.

Issue 50. Criticality Accident Alarms for Nearby Buildinqs USEC determined the evacuation area around the CAAS clusters (clustered buildings) based on a 12 rad exposure from a postulated criticality accident within these buildings. Several buildings that are located within the evacuation area do not have evacuation horns and lights activated by these clusters. The criticality alarm horns from adjacent alarmed buildings cannot be heard within most of the unalarmed buildings. USEC is to install evacuation horns and/or lights in the unalarmed buildings located within the evacuation areas of CAAS-clustered buildings or remove the unalarmed building from the evacuation area. These modifications are to be complete by December 15,1998.

16.0 ENVIRONMENTAL REVIEW 1

Renewing the Certificate of Compliance for operation of the PGDP will not have a significant effect on the human environment. Contiraed regulation by the NRC will not result in any environmental impacts beyond those prmusly considered by DOE in its environmental reviews and which currently exist or wos!d be expected to continue absent NRC regulatory oversight. Therefore, in accordance t ith 10 CFR 51.22(c)(19), neither an environmental assessment nor an environmentalimpact statement is warranted for the renewal of the certification of the PGDP. This deterrr ination only applies to those aspects that are in i

' compliance with 10 CFR Part 76.

An Environmental Assessment (EA) was prepared as part of the Compliance Plan and application review process during the initial certification. The EA concluded that the environmental effects of approving the Compliance Plan would be insignificant. The EA further concluded that the Compliance Plan was sufficient to ensure that, during the interim period of noncompliance, plant operations related to areas of noncompliance would not significantly affect the quality of the human environment. The EA resulted in a Finding of No Significant impact (FONSI). The FONSI was published in the Federal Reaister (61FR49360) on September 19,1996. As there are no new Compliance Plan Issues, the staff did not prepare a new EA and FONSI. The staff considers the conclusions of the EA and FONSI to remain valid.

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17.0 AUTHORIZATIONS AND EXEMPTIONS As part of initial certification, USEC was authorized by tre NRC to release items for unrestricted use if the surface contamination is less than limits established in the SAR. USEC has requested the authorization be continued for the renewal period. The limits are consistent with those established in the NRC's April 1993 document entitled," Guidelines for Decontamination of Facilities and Equipment Prior to Release for Unrestricted Use or Termination of Licenses for Byproduct, Source,'or Special Nuclear Material." The staff continues to consider this

. authorization as being acceptable.

USEC continues to request an exemption from the requirements of 10 CFR 20.1904," Labeling ,

Containers," which requires that each container of certified material bears a durable, clearly visible label. The basis for approving this exemption is contained in Chapter 7 of this CER.

To approve the special authorizations and exemptions, the staff plans to include the following condition:

'The United States Enrichment Corporation is hereby granted the special authorizations and exemptions in Chapter 1, Section 1.8 of the Safety Analysis Report, Revision 27.

18.0 TERM OF CERTIFICATE The renewed certificate will be issued for an effective period of approximately 5 years, with an expiration date of December 31,2003.

19.0 CONCLUSION

S Upon completing the compliance evaluation of USEC's application, including the SAR, TSRs, program plans, and Compliance Plan, the staff concludes that there is reasonable assurance that the plant will continue to be operated such that public health and safety will be adequately protected, and that the common defense and security will not be endangered. Furthermore, the staff determined that the application fulfills the requirements of 10 CFR Part 76. The staff recommends that USEC be issued a renewed Certificate of Compliance in accordance with the statements and representations contained in the SAR, program plans, TSRs and Compliance Plan. The staff plans to include the following conditions as part of the certification (note that the first three conditions may be revised to reflect any amendments made between the submittal of Revision 27 and the date of the recertification):

The United States Enrichment Corporation shall conduct its operations in accordance with the statements and representations contained in the Certification Application through Revision 27, and in the Compliance Plan through Revision 7.

The United States Enrichment Corporation shall conduct its operations in accordance with the Technical Safety Requirements that are contained in Volume 4, Revision 27 of the Application. Changes to the Technical Safety Requirements shall require NRC approval prior to implementation.

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4 The United States Enrichment Corporation is hereby granted the special authorizations and exemptions in Chapter 1, Section 1.8 of the Safety Analysis Report, Revision 27.

If, at any time after the privatization date, the Corporation obtains information reasonably indicating changes described in the National industrial Security Program Operating Manual, DOD 5520.22-M, January 1995 (NISPOM), Chapter 1, Section 3,1-302(h), to the information previously submitted to NRC, described in the NISPOM, Chapter 2, Section 3,2-302b.(1) through (11), the Corporation shall notify NRC in writing within 15 days.

lf the Corporation enters into negotiations for the proposed merger, acquisition, or takeover by a foreign person, the Corporation shall submit notification to NRC, in writing, within 15 days of the commencement of such negotiations. The submission shallinclude the type of transaction under negotiation (stock purchase, asset purchase, etc.), the identity of the potential foreign person investor, a plan to negate foreign ownership, control, or domination, and copies of any related loan, purchase and shareholder agreements, annual reports, bylaws, articles of incorporation, partnership agreements, and reports filed with other federal agencies.

USEC, or its successors, as the Executive Agent for the United States for implementing the Russian HEU Agreement, shall notify NRC in writing within 15 days, of any termination or material change in the provisions of the

" Memorandum of Agreement Between the United States Acting By and Through the United States Department of State, and the United States Department of Energy and the United States Enrichment Corporation, for USEC to Serve as the United States Government's Executive Agent Under the Agreement Between the United States and the Russian Federation Concerning the Disposition of Highly Enriched Uranium Extracted from Nuclear Weapons," entered into as of April 18, 1997.

The United States Enrichment Corporation shall conduct an investigation for each reportable event and develop corrective actions for each event or condition requiring NRC notification. USEC shall revise Sections 6.9.4 and 6.9.6 of the Paducah Safety Analysis Report to reflect these actions within 90 days of the renewal.

The United States Enrichment Corporation shall review the decommissioning cost estimates and associated funding levels in July of each year and adjust the estimates and funding levels as necessary. If USEC determines that the existing financial instruments do not adequately cover the adjusted decommissioning cost estimate, USEC shall submit financial instruments to cover the new cost estimates by September 30th of each year.

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20.0 ACRONYMS AND ABBREVIATIONS ALARA' as low as is reasonably achievable .

Am-Be americium-beryllium

.CAAS criticality accident alarm system -

CAL Confirmatory Action Letter Central Control Facility CCF CER compliance evaluation report as2Cf . californium-252 Cl- curies DOE- Department of Energy EA environmental assessment EPA Environreental Protection Agency FNMC Fundamental Nuclear Material Control FONSI Finding of No Significant impact FSAR final safety analysis report

' GDP- gaseous diffusion plant IPO initial Public Offering LMUS . Lockheed Martin Utility Services, Inc.

' 'mCl . millicurie NCS nuclear criticality safety NCSA nuclear criticality safety approval NMMSS Nuclear Materials Management and Safeguards System NOED Notice of Enforcement Discretion

.MOU- Memorandum of Understanding NISPOM National Industrial Security Program Operating Manual NRC- United States Nuclear Regulatory Commission PGDP Paducah Gaseous Diffusion Plant PORC- plant operations review committee OA quality assurance OAP Ouality Assurance Program 1- RMDC Records Management and Document Control SAR safety analysis report SARUP safety analysis report upgrade SNM special nuclear material SNM-LSS - special nuclear material of low strategic significance SRP standard review plan

-SSC structure, system, and component SWU separative work unit TSR technical safety requirement

- 83 U uranium-233 835U uranium-235

' U F. uranium hexafluoride U3 0, triuranium octoxide UO2 F, uranyl fluoride USEC United States Enrichment Corporation WKWMA . West Kentucky Wildlife Management Area 37

l 1 .

, wt % weight percent WSTS Westinghouse Standard Technical Specifications 1

L 1

1 1

I I

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APPENDlX A PUBLIC COMMENTS AND NRC STAFF RESPONSES  !

I There were no public comments received on the Paducah application for renewal. As part of the consultation process with EPA, EPA did provide comments on the renewal applications for Paducah and Portsmouth. For Paducah, EPA found the environmental section of the application to be factually accurate and complete and that there were no current enforcement actions being taken at the plant. For Portsmouth, EPA had some specific comments. The staff has decided to address the Portsmouth comments that could be viewed as generic to both  ;

facilities in this document as well as in the Portsmouth CER. The facility-specific comments are-only addressed in the Portsmouth CER. The generic comments are addressed below.

Comment: The renewal period should be every 2 years, instead of 5 years. TN t determination should relate to and be based upon, among other factors, the degree of environmental compliance of the facility.

Response: The operations at the GDPs remain reasonably stable, with few changes.

Because of the stable operations, frequent review is not necessary. Other fuel cycle facilities are licensed for 10-year periods. NRC has resident inspectors (2) at each GDP. The NRC also conducts routine and specialinspections from both the Region lit office and from Headquarters to evaluate activities at the site. The NRC currently reviews the compliance status of the GDPs in the Annual Report to Congress. The staff believes that a 5-year period for the certification is l

reasonable.

Comment: The significant amount of information " incorporated by reference" makes a thorough review of the Renewal Application difficult. <

Response: The staff agrees that incorporating by reference can make the review more '

difficult, particularly for those who are not familiar with the application documents. A renewal application that has no changes from the current application is easier to review than a complete new submittal. A new submittal [

requires more effort because it may not be clear where changes have been made. Incorporation by reference is permitted by the regulations and is encouraged, particularly when there are few changes in operation as is the case for the GDPs.

Comment: The statement "Due to the required schedule for submission of this document, ,

effluent and environmental data and public dose assessments for CY 1997 will  ;

not be available in time for inclusion here," is too general and insufficient. l Additional justification / explanation which details for the reader the reasons why i

data up to FY97 can not be available should be provided.

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. Response: Due to the time lag in obtaining sample analysis data, it is not unusual for the data to be a year behind. The NRC typically reviews the data on a calender year ,

I basis versus a fiscal year basis. The NRC also has access to the most current data through the inspection program. As part of the annual update filed every  :

April 15, USEC provides updated environmental data.

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