IR 05000528/2011004

IR 05000528-11-004, 05000529-11-004, 05000530-11-004; 07/01/2011 - 09/30/2011; Palo Verde Nuclear Generating Station, Integrated Resident and Regional Report; Maint. Effect.; Op. Evals; and Ident. and Resolution of Problems

ML113140390
Person / Time
Site:	Palo Verde
Issue date:	11/10/2011
From:	Ryan Lantz NRC/RGN-IV/DRP/RPB-D
To:	Edington R Arizona Public Service Co
References
IR-11-004
Download: ML113140390 (46)

Text

UNITED STATES NUCLEAR REGULATORY COMMISSION ber 10, 2011

SUBJECT:

PALO VERDE NUCLEAR GENERATING STATION -- NRC INTEGRATED INSPECTION REPORT 05000528/2011004, 05000529/2011004, and 05000530/2011004

Dear Mr. Edington:

On September 30, 2011, the U.S. Nuclear Regulatory Commission (NRC) completed an inspection at your Palo Verde Nuclear Generating Station, Units 1, 2, and 3, facility. The enclosed integrated inspection report documents the inspection findings, which were discussed on October 4, 2011, with Mr. D. Mims, Vice President, Regulatory Affairs and Plant Improvement, and other members of your staff.

The inspections examined activities conducted under your license as they relate to safety and compliance with the Commissions rules and regulations and with the conditions of your license.

The inspectors reviewed selected procedures and records, observed activities, and interviewed personnel.

Based on the results of this inspection, the NRC has identified three issues that were evaluated under the risk significance determination process as having very low safety significance (Green). The NRC has determined that violations are associated with these issues. However, because of the very low safety significance and because they were entered into your corrective action program, the NRC is treating these findings as a noncited violations, consistent with Section 2.3.2 of the NRC Enforcement Policy.

If you contest the violations or the significance of the noncited violations, you should provide a response within 30 days of the date of this inspection report, with the basis for your denial, to the U.S. Nuclear Regulatory Commission, ATTN: Document Control Desk, Washington, D.C.

20555-0001, with copies to the Regional Administrator, U.S. Nuclear Regulatory Commission, Region IV, 612 E. Lamar Blvd, Suite 400, Arlington, Texas, 76011-4125; the Director, Office of Enforcement, U.S. Nuclear Regulatory Commission, Washington, D.C. 20555-0001; and the NRC Resident Inspector at the facility. In addition, if you disagree with the crosscutting aspect

Arizona Public Service Company -2-assigned to any finding in this report, you should provide a response within 30 days of the date of this inspection report, with the basis for your disagreement, to the Regional Administrator, Region IV, and the NRC Resident Inspector at the facility.

In accordance with 10 CFR 2.390 of the NRC's "Rules of Practice," a copy of this letter, its enclosure(s), and your response, if you choose to provide one for cases where a response is not required, will be made available electronically for public inspection in the NRC Public Document Room or from the NRC's document system (ADAMS), accessible from the NRC Web site at http://www.nrc.gov/reading-rm/adams.html. To the extent possible, your response should not include any personal privacy or proprietary information so that it can be made available to the Public without redaction.

Sincerely,

/RA/

Ryan Lantz, Chief Project Branch D Division of Reactor Projects Docket Nos.: 50-528, 50-529, 50-530 License: NPF-41, NPF-51, NPF-74

Enclosure:

NRC Inspection Report 05000528/2011004, 05000529/2011004, and 05000530/2011004 w/Attachment: Supplemental Information

REGION IV==

Docket: 50-528, 50-529, 50-530 License: NPF-41, NPF-51, NPF-74 Report: 05000528/2011004, 05000529/2011004, 05000530/2011004 Licensee: Arizona Public Service Company Facility: Palo Verde Nuclear Generating Station, Units 1, 2, and 3 Location: 5951 South Wintersburg Road Tonopah, Arizona Dates: July 1 through September 30, 2011 Inspectors: M. Brown, Senior Resident Inspector J. Bashore, Resident Inspector M. Baquera, Resident Inspector G. Warnick, Senior Resident Inspector Approved By: Ryan Lantz, Chief, Project Branch D Division of Reactor Projects-1- Enclosure

SUMMARY OF FINDINGS

IR 05000528/2011004, 05000529/2011004, 05000530/2011004; 07/01/2011 - 09/30/2011; Palo

Verde Nuclear Generating Station, Integrated Resident and Regional Report; Maint. Effect.; Op.

Evals; and Ident. and Resolution of Problems.

The report covered a 3-month period of inspection by resident inspectors. Three Green noncited violations of significance were identified. The significance of most findings is indicated by their color (Green, White, Yellow, or Red) using Inspection Manual Chapter 0609,

Significance Determination Process. The crosscutting aspect is determined using Inspection Manual Chapter 0310, Components Within the Cross-Cutting Areas. Findings for which the significance determination process does not apply may be Green or be assigned a severity level after NRC management review. The NRC's program for overseeing the safe operation of commercial nuclear power reactors is described in NUREG-1649, Reactor Oversight Process,

Revision 4, dated December 2006.

Cornerstone: Mitigating Systems

Green.

The inspectors identified a noncited violation of 10 CFR Part 50,

Appendix B, Criteria V, Instructions, Procedures, and Drawings, for the licensees failure to follow station procedures and perform an adequate classification and evaluation of two conditions adverse to quality. One example involved the installation of an automatic voltage regulator card in Unit 2 emergency diesel generator train B that was potentially defective and had been previously reported under 10 CFR Part 21 Notification 1996-29. The second example involved inadequate design control of the control room essential filtration system outside air dampers that resulted in Unit 1 and Unit 3 operators declaring all trains of control room emergency filtration actuation system inoperable. In both examples, Procedure 01DP-0AP12, Palo Verde Action Request Processing, required cause evaluations to be performed, however the licensee mis-classified the issues and only required a review for extent of condition. The licensee entered the issue into the corrective action program as Palo Verde Action Request (PVAR) 3824036. The licensee revised their corrective action review process to add additional management oversight. The licensee also implemented immediate corrective actions to revise plant procedures to maintain the control room outside air dampers normally open and replaced the automatic voltage regulator card in Unit 2 emergency diesel generator train B.

The inspectors concluded the failure of Arizona Public Service to follow station procedures and adequately classify and evaluate two conditions adverse to quality was a performance deficiency. The inspectors concluded that the issue was more than minor because if left uncorrected, the performance deficiency has the potential to lead to a more significant safety concern. Specifically, the failure of plant personnel to perform apparent cause evaluations, and implement corrective actions to minimize recurrence could result in future plant changes outside of the design basis or potentially defective components being installed in plant equipment. The finding affected the Barrier Integrity and Mitigating Systems Cornerstones. The inspectors evaluated the significance of the finding under the Significance Determination Process, as defined in Inspection Manual Chapter 0609.04, Phase I - Initial Screening and Characterization of Findings, and concluded the finding was of very low safety significance (Green). The first example was Green because it: (1) is not a design or qualification issue; (2) did not represent an actual loss of safety function of the system or train; (3) did not result in the loss of one or more trains of non-technical specification equipment; and (4) did not screen as potentially risk significant due to a seismic, flooding, or severe weather initiating event. The second example was Green because it only represented a degradation of the radiological barrier function of the control room.

The inspectors determined this finding has a crosscutting aspect in the area of human performance associated with the component of work practices because the licensee failed to provide adequate supervisory and management oversight of the condition report classification activities such that nuclear safety is supported H.4(c)(Section 1R12).

Green.

The inspectors identified a noncited violation of 10 CFR Part 50 Appendix B, Criterion V, Instructions, Procedures, and Drawings, for the failure of operations and engineering personnel to follow station procedures and complete a prompt operability determination for the essential chilled water system commensurate with system safety significance. Specifically, after identifying gas voids in the essential chilled water system in Unit 2, and subsequently Units 1 and 3, plant personnel failed to meet timeliness and quality requirements for a prompt operability determination of the essential chilled water systems. The licensee developed an Operational Decision Making Issue Plan and has maintained gas volumes below established limits. The licensee entered the issue into the corrective action program as PVAR 3886168 and has not completed all corrective actions.

The inspectors concluded that the failure of the operations and engineering personnel to adequately evaluate the operability of a safety-related structure, system, or component was a performance deficiency. The inspectors concluded the performance deficiency is more than minor because it affected the equipment performance attribute of the Mitigating Systems Cornerstone objective to ensure the availability, reliability, and capability of systems that respond to initiating events to prevent undesirable consequences. The inspectors evaluated the significance of the issue under the Significance Determination Process, as defined in Inspection Manual Chapter 0609.04, Phase I - Initial Screening and Characterization of Findings, and concluded the finding was of very low safety significance (Green) because the finding: (1) is not a design or qualification issue; (2) did not represent an actual loss of safety function of the system or train; (3) did not result in the loss of one or more trains of non-technical specification equipment; and (4) did not screen as potentially risk significant due to a seismic, flooding, or severe weather initiating event. The inspectors determined this finding has a crosscutting aspect in the area of human performance associated with the component of decision making because the licensee failed to make safety-significant or risk-significant decisions using a systematic process, especially when faced with uncertain or unexpected plant conditions, to ensure safety is maintained H.1(a)(Section 1R15).

Green.

The inspectors identified a noncited violation of 10 CFR Part 50,

Appendix B, Criterion XVI, Corrective Action, for the licensees failure to promptly identify and correct a condition adverse to quality associated with Unit 3 essential chiller A oil level. The condition adverse to quality involved inadequacies in plant operating procedures used to operate the chiller at low load conditions. As a result, the chiller was declared inoperable six times between July 27, 2011 and September 5, 2011 due to low oil level caused by oil migration into the refrigerant, a known phenomenon that occurs during low load conditions.

The licensee implemented a temporary procedure change to ensure sufficient load is placed on the essential chiller during operation. The licensee entered the issue into the corrective action program as PVAR 3892184 and has not completed all corrective actions for the issue.

The failure to promptly identify and correct a condition adverse to quality associated with operation of essential chillers was a performance deficiency.

The performance deficiency is more than minor and is therefore a finding because it is associated with the equipment performance attribute of the Mitigating Systems Cornerstone and affects the cornerstone objective of ensuring the availability, reliability, and capability of systems that respond to initiating events to prevent undesirable consequences. Using Inspection Manual Chapter 0609.04, Phase I - Initial Screening and Characterization of Findings, the inspectors concluded the finding was of very low safety significance (Green)because the finding: (1) is not a design or qualification issue; (2) did not represent an actual loss of safety function of the system or train; (3) did not result in the loss of one or more trains of non-technical specification equipment; and (4)did not screen as potentially risk significant due to a seismic, flooding, or severe weather imitating event. The finding has a crosscutting aspect in the area of problem identification and resolution associated with the corrective action program component because the licensee failed to take timely corrective actions after identifying inadequacies in the operating procedure during review of similar issues that occurred in Unit 2 P.1(d)(Section 4OA2)

Licensee-Identified Violations

None

REPORT DETAILS

Summary of Plant Status

Unit 1 operated at essentially full power until August 6, 2011. Unit 1 experienced an automatic reactor trip when a control rod element assembly dropped during control rod operability checks.

Unit 1 returned to essentially full power on August 14, 2011 and remained there until September 28, 2011. Unit 1 was forced to downpower to approximately 40 percent power to address a leak in the condenser affecting steam generator chemistry. Unit 1 corrected the issue and increased power to approximately 80 percent power and remained there for the remainder of the inspection period.

Unit 2 operated at essentially full power during the inspection period.

Unit 3 operated at essentially full power until August 21, 2011. Unit 3 experienced a main turbine trip due to faulty vibration indication and was forced to reduce to approximately 12 percent power. Unit 3 returned to essentially full power on August 24, 2011 and remained there for the remainder of the inspection period.

REACTOR SAFETY

Cornerstones: Initiating Events, Mitigating Systems, and Barrier Integrity

1R01 Adverse Weather Protection

Readiness for Impending Adverse Weather Conditions

a. Inspection Scope

Since thunderstorms with potential high winds were in the vicinity of the facility for July 5-6, 2011, the inspectors reviewed the plant personnels overall response to the weather conditions. The inspectors completed a review of the licensees actions in response to impending adverse weather involving severe thunderstorms and high wind conditions experienced on July 5-6, 2011. Inspectors verified operations personnel appropriately reviewed the abnormal operating procedure entry conditions and compared actual weather conditions to the entry requirements. The inspectors also verified that all maintenance activities were reviewed for emergent plant risk and restoration, and appropriate protected area announcements were made to advise site personnel to take shelter. Specific documents reviewed during this inspection are listed in the attachment.

These activities constitute completion of one readiness for impending adverse weather condition sample as defined in Inspection Procedure 71111.01-05.

b. Findings

No findings were identified.

1R04 Equipment Alignments

Partial Walkdown

a. Inspection Scope

The inspectors performed partial system walkdowns of the following risk-significant systems:

• July 14, 2011, Unit 2, containment spray system train A

• August 24, 2011, Unit 2, emergency diesel generator train B

• September 22, 2011, Unit 3, low pressure safety injection train B The inspectors selected these systems based on their risk significance relative to the reactor safety cornerstones at the time they were inspected. The inspectors attempted to identify any discrepancies that could affect the function of the system, and, therefore, potentially increase risk. The inspectors reviewed applicable operating procedures, system diagrams, UFSAR, technical specification requirements, administrative technical specifications, outstanding work orders, condition reports, and the impact of ongoing work activities on redundant trains of equipment in order to identify conditions that could have rendered the systems incapable of performing their intended functions. The inspectors also inspected accessible portions of the systems to verify system components and support equipment were aligned correctly and operable. The inspectors examined the material condition of the components and observed operating parameters of equipment to verify that there were no obvious deficiencies. The inspectors also verified that the licensee had properly identified and resolved equipment alignment problems that could cause initiating events or impact the capability of mitigating systems or barriers and entered them into the corrective action program with the appropriate significance characterization. Specific documents reviewed during this inspection are listed in the attachment.

These activities constitute completion of three partial system walkdown samples as defined in Inspection Procedure 71111.04-05.

b. Findings

No findings were identified.

1R05 Fire Protection

.1 Quarterly Fire Inspection Tours

a. Inspection Scope

The inspectors conducted fire protection walkdowns that were focused on availability, accessibility, and the condition of firefighting equipment in the following risk-significant plant areas:

• July 14, 2011, Unit 2, essential cooling water heat exchanger rooms, auxillary building elevation 100 feet

• August 3, 2011, Unit 1, fuel building all elevations

• August 3, 2011, Unit 2, control building all elevations including the lower and upper cable spreading rooms

• August 15, 2011, Unit 3, control building all elevations

• August 25, 2011, Unit 3, fuel handling building all elevations The inspectors reviewed areas to assess if licensee personnel had implemented a fire protection program that adequately controlled combustibles and ignition sources within the plant; effectively maintained fire detection and suppression capability; maintained passive fire protection features in good material condition; and had implemented adequate compensatory measures for out of service, degraded or inoperable fire protection equipment, systems, or features, in accordance with the licensees fire plan.

The inspectors selected fire areas based on their overall contribution to internal fire risk as documented in the plants Individual Plant Examination of External Events with later additional insights, their potential to affect equipment that could initiate or mitigate a plant transient, or their impact on the plants ability to respond to a security event. Using the documents listed in the attachment, the inspectors verified that fire hoses and extinguishers were in their designated locations and available for immediate use; that fire detectors and sprinklers were unobstructed; that transient material loading was within the analyzed limits; and fire doors, dampers, and penetration seals appeared to be in satisfactory condition. The inspectors also verified that minor issues identified during the inspection were entered into the licensees corrective action program.

Specific documents reviewed during this inspection are listed in the attachment.

These activities constitute completion of five quarterly fire-protection inspection samples as defined in Inspection Procedure 71111.05-05.

b. Findings

No findings were identified.

.2 Annual Fire Protection Drill Observation

a. Inspection Scope

On September 7, 2011, the inspectors observed a fire brigade activation for a simulated fire in a cable shaft in the Unit 3 control building,120 foot elevation. The observation evaluated the readiness of the plant fire brigade to fight fires. The inspectors verified that the licensee staff identified deficiencies, openly discussed them in a self-critical manner at the drill debrief, and took appropriate corrective actions. Specific attributes evaluated were:

(1) proper wearing of turnout gear and self-contained breathing apparatus;

(2) proper use and layout of fire hoses;

(3) employment of appropriate

firefighting techniques;

(4) sufficient firefighting equipment brought to the scene;

(5) effectiveness of fire brigade leader communications, command, and control;

(6) search for victims and propagation of the fire into other plant areas;

(7) smoke removal operations;

(8) utilization of preplanned strategies;

(9) adherence to the preplanned drill scenario; and

(10) drill objectives.

These activities constitute completion of one annual fire-protection inspection sample as defined in Inspection Procedure 71111.05-05.

b. Findings

No findings were identified.

1R06 Flood Protection Measures

a. Inspection Scope

The inspectors reviewed the UFSAR, the flooding analysis, and plant procedures to assess susceptibilities involving internal flooding; reviewed the corrective action program to determine if licensee personnel identified and corrected flooding problems; inspected underground bunkers/manholes to verify the adequacy of sump pumps, level alarm circuits, cable splices subject to submergence, and drainage for bunkers/manholes; and verified that operator actions for coping with flooding can reasonably achieve the desired outcomes. The inspectors also inspected the areas listed below to verify the adequacy of equipment seals located below the flood line, floor and wall penetration seals, watertight door seals, common drain lines and sumps, sump pumps, level alarms, and control circuits, and temporary or removable flood barriers. Specific documents reviewed during this inspection are listed in the attachment.

• September 7, 2011, Unit 1, emergency diesel generator fuel oil vault water intrusion inspection These activities constitute completion of one bunker/manhole sample as defined in Inspection Procedure 71111.06-05.

b. Findings

No findings were identified.

1R11 Licensed Operator Requalification Program

a. Inspection Scope

On August 23, 2011, the inspectors observed a crew of licensed operators in the plants simulator to verify that operator performance was adequate, evaluators were identifying and documenting crew performance problems and training was being conducted in accordance with licensee procedures. The inspectors evaluated the following areas:

• Licensed operator performance

• Crews clarity and formality of communications

• Crews ability to take timely actions in the conservative direction

• Crews prioritization, interpretation, and verification of annunciator alarms

• Crews correct use and implementation of abnormal and emergency procedures

• Control board manipulations

• Oversight and direction from supervisors

• Crews ability to identify and implement appropriate technical specification actions and emergency plan actions and notifications The inspectors compared the crews performance in these areas to pre-established operator action expectations and successful critical task completion requirements.

Specific documents reviewed during this inspection are listed in the attachment.

These activities constitute completion of one quarterly licensed-operator requalification program sample as defined in Inspection Procedure 71111.11.

b. Findings

No findings were identified.

1R12 Maintenance Effectiveness

a. Inspection Scope

The inspectors evaluated degraded performance issues involving the following risk significant systems:

• July 15, 2011, Unit 2, emergency diesel generator train A automatic voltage regulator The inspectors reviewed events such as where ineffective equipment maintenance has resulted in valid or invalid automatic actuations of engineered safeguards systems and independently verified the licensee's actions to address system performance or condition problems in terms of the following:

• Implementing appropriate work practices

• Identifying and addressing common cause failures

• Scoping of systems in accordance with 10 CFR 50.65(b)

• Characterizing system reliability issues for performance

• Charging unavailability for performance

• Trending key parameters for condition monitoring

• Ensuring proper classification in accordance with 10 CFR 50.65(a)(1) or -(a)(2)

• Verifying appropriate performance criteria for structures, systems, and components classified as having an adequate demonstration of performance through preventive maintenance, as described in 10 CFR 50.65(a)(2), or as requiring the establishment of appropriate and adequate goals and corrective actions for systems classified as not having adequate performance, as described in 10 CFR 50.65(a)(1)

The inspectors assessed performance issues with respect to the reliability, availability, and condition monitoring of the system. In addition, the inspectors verified maintenance effectiveness issues were entered into the corrective action program with the appropriate significance characterization. Specific documents reviewed during this inspection are listed in the attachment.

These activities constitute completion of one quarterly maintenance effectiveness sample as defined in Inspection Procedure 71111.12-05.

b. Findings

Failure to Adequately Classify and Evaluate Conditions Adverse to Quality

Introduction.

The inspectors identified a Green noncited violation of 10 CFR Part 50, Appendix B, Criteria V, Instructions, Procedures, and Drawings, for the licensees failure to follow station procedures and perform an adequate classification and evaluation of two conditions adverse to quality.

Description.

The first example occurred when the licensee initiated PVAR 3624127 on February 25, 2011 and PVAR 3665695 on March 17, 2011 after identifying that an automatic voltage regulator card installed in Unit 2 emergency diesel generator train B was potentially defective and reported under 10 CFR Part 21 Notification 1996-29.

PVAR 3665695 requested an investigation into how and why the part had been installed in the diesel generator after the 10 CFR Part 21 report had been issued. The second example occurred when the licensee initiated PVAR 3691352 on April 13, 2011 after identifying that a procedure change request implemented on April 8, 1986 changed the required Control Room Essential Filtration System (CREFS) outside air damper position from normally open to normally closed, contrary to the original design requirements. As a result, Units 1 and 3 operators declared all trains of Control Room Emergency Filtration Actuation System (CREFAS) inoperable.

In both examples, Procedure OIDP-OAP12, Palo Verde Action Request Processing, required cause evaluations to be performed, however, the licensee classified the issues as Adverse-Evaluate which only required corrective actions and a review for extent of

condition. The inspectors questioned the classification of the issues and whether cause evaluations should have been performed based on the significance of the issues, as directed by Procedure 01DP-0AP12, Palo Verde Action Request Processing.

Procedure 01DP-0AP12, Step 3.8.6.1, required the ARRC to assign and classify the associated Condition Report Disposition Request (CRDR) per Appendix E, Condition Classification Instruction. Appendix E required that CRDRs be classified at a given significance level based on several factors, including risk, consequences, and impact on nuclear safety. Appendix E further defined Adverse-Evaluate as conditions that have low risk to the safe operation of the plant. The appendix also stated CRDRs shall be classified as Apparent Cause when the severity of the condition, or its impact on the safe and economical operation of the plant or personnel safety, require an evaluation to determine apparent cause and determine extent of condition. This classification includes Condition Adverse to Quality (CAQs) and Adverse Conditions where it is desired to minimize the probability of recurrence.

The licensee subsequently concluded that the classifications were incorrect and initiated action to perform apparent cause evaluations. The licensee implemented immediate corrective actions to revise plant procedures to maintain the control room outside air dampers normally open and replaced the automatic voltage regulator card in Unit 2 emergency diesel generator train B. The licensee entered the issue into the corrective action program as PVAR 3824036 and has not completed all corrective actions.

The licensee also concluded that the most significant contributor to this issue was the lack of adequate supervisory and management involvement in the Condition Review Group, which provides oversight of the disposition of PVARs and the classification and assignment of CRDRs by the ARRC. The licensee took action to increase the level of management oversight in the PVAR review process.

Analysis.

The inspectors concluded the failure of plant personnel to adequately classify and evaluate conditions adverse to quality in accordance with plant procedures was a performance deficiency. The inspectors concluded the performance deficiency is more than minor because if left uncorrected, it would have the potential to lead to a more significant safety concern, and is therefore a finding. Specifically, the failure of plant personnel to perform apparent cause evaluations for the conditions and implement corrective actions to minimize recurrence could result in future plant changes outside of the design basis or potentially defective components being installed in plant equipment.

The findings affected the Mitigating Systems and Barrier Integrity Cornerstones. The inspectors evaluated the significance of each example under the Significance Determination Process, as defined in Inspection Manual Chapter 0609.04, Phase I -

Initial Screening and Characterization of Findings, and concluded the finding was of very low safety significance (Green). The first example was Green because it:

(1) is not a design or qualification issue;

(2) did not represent an actual loss of safety function of the system or train;

(3) did not result in the loss of one or more trains of non-technical specification equipment; and

(4) did not screen as potentially risk significant due to a seismic, flooding, or severe weather initiating event. The second example was Green because it only represented a degradation of the radiological barrier function of the control room. The inspectors determined this finding has a cross-cutting aspect in the area of human performance associated with the component of work practices because

the licensee failed to provide adequate supervisory and management oversight of the condition report classification activities such that nuclear safety is supported H.4(c).

Enforcement.

Title 10 CFR Part 50, Appendix B, Criterion V, Instructions, Procedures, and Drawings, requires, in part, that activities affecting quality be prescribed by documented instructions, procedures, or drawings, of a type appropriate to the circumstances and be accomplished in accordance with these instructions, procedures, or drawings. Procedure 01DP-0AP12, Palo Verde Action Request Processing, Revision 14, provided guidelines and instructions for classifying and evaluating conditions adverse to quality. Contrary to the above, between February 25, 2011 and April 13, 2011, plant personnel failed to accomplish an activity affecting quality in accordance with the prescribed instructions, procedures, and drawings. Specifically, plant personnel failed to follow Procedure 01DP-0AP12 and adequately classify and evaluate two conditions adverse to quality associated with inadequate design control of control room outside air dampers and the installation of a potentially defective component in an emergency diesel generator. The licensee implemented corrective actions to add management oversight to the corrective action review process, revise plant procedures to maintain the control room outside air dampers normally open and replaced the automatic voltage regulator card in Unit 2 emergency diesel generator train B. The licensee has not completed all corrective actions associated with this finding.

Because this finding is of very low safety significance and was entered into the corrective action program as PVAR 3824036, this violation is being treated as a noncited violation in accordance with Section 2.3.2 of the Enforcement Policy:

NCV 05000528;05000529;05000530/2011004-01, Failure to Adequately Classify and Evaluate Conditions Adverse to Quality.

1R13 Maintenance Risk Assessments and Emergent Work Control

a. Inspection Scope

The inspectors reviewed licensee personnel's evaluation and management of plant risk for the maintenance and emergent work activities affecting risk-significant and safety-related equipment listed below to verify that the appropriate risk assessments were performed prior to removing equipment for work:

• July 7, 2011, Unit 2, train B emergency diesel generator unplanned maintenance following failed surveillance testing

• July 18, 2011, Unit 3, train A emergency diesel generator, emergency cooling water, emergency chilled water, and safety injection systems outage for planned maintenance

• September 13, 2011, Unit 2, train A safety injection systems outage for planned maintenance The inspectors selected these activities based on potential risk significance relative to the reactor safety cornerstones. As applicable for each activity, the inspectors verified that licensee personnel performed risk assessments as required by 10 CFR 50.65(a)(4)and that the assessments were accurate and complete. When licensee personnel

performed emergent work, the inspectors verified that the licensee personnel promptly assessed and managed plant risk. The inspectors reviewed the scope of maintenance work, discussed the results of the assessment with the licensee's probabilistic risk analyst or shift technical advisor, and verified plant conditions were consistent with the risk assessment. The inspectors also reviewed the technical specification requirements and inspected portions of redundant safety systems, when applicable, to verify risk analysis assumptions were valid and applicable requirements were met. Specific documents reviewed during this inspection are listed in the attachment.

These activities constitute completion of three maintenance risk assessments and emergent work control inspection samples as defined in Inspection Procedure 71111.13-05.

b. Findings

No findings were identified.

1R15 Operability Evaluations

a. Inspection Scope

The inspectors reviewed the following issues:

• July 6, 2011, Unit 1, inadequate torque values established for solenoid operated pressurizer vent valve, HV-108, electrical conduit seal assembly

• July 11, 2011, Units 1, 2, and 3, main steam support structure temperatures exceeded design temperature

• August 1, 2011, Units 1, 2, and 3, reactor water storage tank fuel pool cooling system return piping seismic qualification

• August 3, 2011, Unit 2, emergency cooling water train B air entrainment

• August 3, 2011, Unit 3, battery chargers BD and D inadvertently paralleled during maintenance

• August 9, 2011, Unit 1, steam generator whip restraint bolting failure

• August 10, 2011, Unit 1, control element assembly, CEA-16, delayed drop time during Unit 1 reactor trip

• August 29, 2011, Units 1, 2, and 3, gas accumulation in essential chilled water system The inspectors selected these potential operability issues based on the risk significance of the associated components and systems. The inspectors evaluated the technical adequacy of the evaluations to ensure that technical specification operability was properly justified and the subject component or system remained available such that no

unrecognized increase in risk occurred. The inspectors compared the operability and design criteria in the appropriate sections of the technical specifications and UFSAR to the licensee personnels evaluations to determine whether the components or systems were operable. Where compensatory measures were required to maintain operability, the inspectors determined whether the measures in place would function as intended and were properly controlled. The inspectors determined, where appropriate, compliance with bounding limitations associated with the evaluations. Additionally, the inspectors also reviewed a sampling of corrective action documents to verify that the licensee was identifying and correcting any deficiencies associated with operability evaluations. Specific documents reviewed during this inspection are listed in the attachment.

These activities constitute completion of eight operability evaluations inspection samples as defined in Inspection Procedure 71111.15-05

b. Findings

Inadequate Operability Determination for Essential Chilled Water System Gas Voids

Introduction.

The inspectors identified a Green noncited violation of 10 CFR Part 50 Appendix B, Criterion V, Instructions, Procedures, and Drawings, for the failure of operations and engineering personnel to follow station procedures and complete a prompt operability determination commensurate with system safety significance.

Specifically, after identifying gas voids in the essential chilled water system in Unit 2, and subsequently Units 1 and 3, plant personnel failed to establish timeliness requirements for a prompt operability determination and failed to adequately evaluate continued degradation and the use of compensatory measures established to maintain operability of the essential chilled water systems.

Description.

On August 18, 2011, Unit 2 operators identified gas voids in essential chilled water system train A while venting the system in response to a high pressure alarm. The licensee entered the issue into the corrective action program as PVAR 3844418. On August 19, 2011, operators completed and approved an immediate operability determination and concluded the system remained operable. The shift manager requested a prompt operability determination to verify the engineering judgment used in the immediate operability determination. On August 21, 2011, engineering personnel concluded that they could not support the immediate operability determination and operators declared Unit 2 essential chilled water system train A inoperable at 3:30 p.m. and entered Technical Specification 3.7.10, Essential Chilled Water System. On August 22, 2011, engineering personnel completed Engineering Work Request (EWR) 3848025 to provide a reasonable assurance of operability for the EC System. Unit 2 operators declared essential chilled water system train A operable on August 22, 2011, at 3:00 p.m., based on the EWR. The EWR established an allowable gas volume of 3.04 cubic feet3 for train A and 2.37 cubic feet3 for train B.

Subsequently, on August 23, 2011, at 2:30 p.m., Unit 1 operators declared essential chilled water system train A inoperable after gas voids were discovered in the system that exceeded the allowable gas volume. On August 26, 2011, plant personnel completed and approved Revision 0 of the Prompt Operability Determination (POD).

Unit 1 operators vented train A in accordance with the POD and declared train A operable. On August 27, 2011, Unit 3 operators declared essential chilled water system train A inoperable after discovery of gas voids that exceeded the allowable volume established in the POD.

The inspectors identified several deficiencies while reviewing this issue. First, Procedure 40DP-9OP26, Operations PVAR Processing and Operability Determination/Functional Assessment, Step 3.3.1.2 stated, The POD should be developed within the time frame established by the SM, generally this is within 24 hours2.777778e-4 days <br />0.00667 hours <br />3.968254e-5 weeks <br />9.132e-6 months <br /> or 75% of the applicable TS allowed LCO time. The inspectors noted that the Unit 2 shift manager failed to establish a due date for the POD when requested on August 19, 2011, and that the POD took seven days to complete. Technical Specification 3.7.10, Condition A had a 72 hour8.333333e-4 days <br />0.02 hours <br />1.190476e-4 weeks <br />2.7396e-5 months <br /> completion time.

Additionally, the inspectors noted that Procedure 40DP-9OP26 did not allow the use of an EWR as the basis for operability of technical specification equipment. Appendix G, Step 1.2.1 stated The purpose of the POD is to provide the responsible Shift Manager with accurate, timely information and an engineering recommendation and supporting basis regarding the operability of the affected SSCs. The procedure further required the POD to include and evaluate the current licensing basis requirements, affected safety functions, mission time, potential for continued degradation, and any compensatory measures required to restore, maintain, or enhance the SSCs capability to perform its specified safety functions. The inspectors identified that EWR 3848025 did not contain that level of detail and did not provide adequate technical justification for declaring Unit 2 essential chilled water system train A operable.

Also, the inspectors challenged the adequacy of the POD once completed. Appendix I of Procedure 40DP-9OP26 provided guidance for the use of compensatory measures.

For example, the appendix stated careful consideration should be given to the conditions (including accident conditions) under which the compensatory measure will be required. Step 1.1.1 required a 10 CFR 50.59 review for any temporary procedure change related to a compensatory measure. The procedure also required a dose assessment be performed for any additional manual action necessary to support post accident mitigation from outside the main control room. Revision 0 of the POD required frequent gas volume measurements accompanied by system venting when necessary until such time as the cause has been determined and action to prevent recurrence implemented. Revision 1 added the following statements:

In order to maintain the operability of the EC systems while the Operational Decision Making Issue (ODMI) is being developed and correction action from the cause investigation are implemented, venting of the system will be required on a periodic basis. Should venting be required during system operation with a design basis event, multiple vent valves are accessible.

The licensee made a temporary procedure change to Procedure 40OP-9EC01, Essential Chilled Water Train A, to perform gas volume measurements in each unit every shift and vent the systems if measured volume exceeded a specific threshold.

The licensee did not perform a 10 CFR 50.59 review of the procedure change or evaluate the ability to perform the actions under accident conditions. The licensee

subsequently completed EWR 3920529 on October 24, 2011 which provided a more detailed evaluation of the initial gas voids discovered in Unit 1 and Unit 3. The evaluation concluded that the voiding was less than the acceptance criteria established in the POD and that both Unit 1 and Unit 3 essential chilled water A trains would have been able to perform their safety functions. The inspectors reviewed the assumptions and evaluation methodology and agreed with the licensees conclusion.

The licensee concluded the most significant contributor to this issue was that operations and engineering personnel failed to make safety-significant or risk-significant decisions (e.g., associated with the establishment of timeliness requirements, the use of EWRs, and the thoroughness of the operability determinations) using a systematic process, especially when faced with uncertain or unexpected plant conditions, to ensure safety is maintained. The licensee developed an Operational Decision Making Issue Plan and has maintained gas volumes below established limits. The licensee entered the issue into the corrective action program as PVAR 3886168 and has not completed all corrective actions.

Analysis.

The inspectors concluded that the failure of the operations and engineering personnel to evaluate the operability commensurate with safety significance of a safety-related structure, system, or component was a performance deficiency. The inspectors concluded the performance deficiency is more than minor because it affected the equipment performance attribute of the Mitigating Systems Cornerstone objective to ensure the availability, reliability, and capability of systems that respond to initiating events to prevent undesirable consequences. The inspectors evaluated the significance of the issue under the Significance Determination Process, as defined in Inspection Manual Chapter 0609.04, Phase I - Initial Screening and Characterization of Findings, and concluded the finding was of very low safety significance (Green) because the finding:

(1) is not a design or qualification issue;

(2) did not represent an actual loss of safety function of the system or train;

(3) did not result in the loss of one or more trains of non-technical specification equipment; and

(4) did not screen as potentially risk significant due to a seismic, flooding, or severe weather initiating event. The inspectors determined this finding has a cross-cutting aspect in the area of human performance associated with the component of decision making because the licensee failed to make safety-significant or risk-significant decisions using a systematic process, especially when faced with uncertain or unexpected plant conditions, to ensure safety is maintained

H.1(a).

Enforcement.

Title 10 CFR Part 50, Appendix B, Criterion V, Instructions, Procedures, and Drawings, requires, in part, that activities affecting quality be prescribed by documented instructions, procedures, or drawings, of a type appropriate to the circumstances and be accomplished in accordance with these instructions, procedures, or drawings. Procedure 40DP-9OP26, Operations PVAR Processing and Operability Determination/Functional Assessment, Revision 30, provided guidelines and instructions for evaluating the operability of safety-related structures, systems, or components, when degraded conditions were identified. Contrary to the above, from August 19-30, 2011, operations and engineering personnel failed to accomplish an activity affecting quality in accordance with the prescribed instructions, procedures, and drawings. Specifically, plant personnel failed to follow Procedure 40DP-9OP26 and provide a timely, adequate technical justification for continued operation of the essential

chilled water system after discovery of gas voids in all three units. Because this finding is of very low safety significance and has been entered into the licensees corrective action program as PVAR 3886168, this violation is being treated as a noncited violation in accordance with Section 2.3.2 of the Enforcement Policy: NCV 05000528; 05000529;05000530/2011004-02, Inadequate Operability Determination for Essential Chilled Water System Gas Voids.

1R18 Plant Modifications

Permanent Modifications

a. Inspection Scope

The inspectors reviewed key parameters associated with energy needs, materials, replacement components, timing, heat removal, control signals, equipment protection from hazards, operations, flow paths, pressure boundary, ventilation boundary, structural, process medium properties, licensing basis, and failure modes for the permanent modification identified as permanent design modification to Unit 2 containment personnel airlock doors.

The inspectors verified that modification preparation, staging, and implementation did not impair emergency/abnormal operating procedure actions, key safety functions, or operator response to loss of key safety functions; postmodification testing will maintain the plant in a safe configuration during testing by verifying that unintended system interactions will not occur; systems, structures and components performance characteristics still meet the design basis; the modification design assumptions were appropriate; the modification test acceptance criteria will be met; and licensee personnel identified and implemented appropriate corrective actions associated with permanent plant modifications. Specific documents reviewed during this inspection are listed in the attachment.

These activities constitute completion of one sample for permanent plant modifications as defined in Inspection Procedure 71111.18-05.

b. Findings

No findings were identified.

1R19 Postmaintenance Testing

a. Inspection Scope

The inspectors reviewed the following postmaintenance activities to verify that procedures and test activities were adequate to ensure system operability and functional capability:

• July 12, 2011, Unit 2, emergency diesel generator B testing after replacement of failed automatic voltage regulator

• July 20, 2011, Unit 2, safety injection system train A valve maintenance

• July 28, 2011, Unit 2, shutdown cooling heat exchanger train A valve maintenance

• August 9, 2011, Unit 1, essential chiller train B following discovery of temperature control set too low The inspectors selected these activities based upon the structure, system, or component's ability to affect risk. The inspectors evaluated these activities for the following (as applicable):

• The effect of testing on the plant had been adequately addressed; testing was adequate for the maintenance performed

• Acceptance criteria were clear and demonstrated operational readiness; test instrumentation was appropriate The inspectors evaluated the activities against the technical specifications, the UFSAR, 10 CFR Part 50 requirements, licensee procedures, and various NRC generic communications to ensure that the test results adequately ensured that the equipment met the licensing basis and design requirements. In addition, the inspectors reviewed corrective action documents associated with postmaintenance tests to determine whether the licensee was identifying problems and entering them in the corrective action program and that the problems were being corrected commensurate with their importance to safety. Specific documents reviewed during this inspection are listed in the attachment.

These activities constitute completion of four postmaintenance testing inspection samples as defined in Inspection Procedure 71111.19-05.

b. Findings

No findings were identified.

1R22 Surveillance Testing

a. Inspection Scope

The inspectors reviewed the UFSAR, procedure requirements, and technical specifications to ensure that the surveillance activities listed below demonstrated that the systems, structures, and/or components tested were capable of performing their intended safety functions. The inspectors either witnessed or reviewed test data to verify that the significant surveillance test attributes were adequate to address the following:

• Preconditioning

• Evaluation of testing impact on the plant

• Acceptance criteria

• Test equipment

• Procedures

• Jumper/lifted lead controls

• Test data

• Testing frequency and method demonstrated technical specification operability

• Test equipment removal

• Restoration of plant systems

• Fulfillment of ASME Code requirements

• Updating of performance indicator data

• Engineering evaluations, root causes, and bases for returning tested systems, structures, and components not meeting the test acceptance criteria were correct

• Reference setting data

• Annunciators and alarms setpoints The inspectors also verified that licensee personnel identified and implemented any needed corrective actions associated with the surveillance testing.

• July 5, 2011, Unit 3, atmospheric dump valve, ADV-179

• August 4, 2011, Unit 3, emergency diesel generator train B

• August 8, 2011, Unit 2, high pressure safety injection pump train A inservice test

• August 15, 2011, Unit 1, auxillary feed water train A inservice test

• September 12, 2011, Unit 3, turbine driven auxiliary feedwater pump Specific documents reviewed during this inspection are listed in the attachment.

These activities constitute completion of five surveillance testing inspection samples as defined in Inspection Procedure 71111.22-05.

b. Findings

No findings were identified.

1EP6 Drill Evaluation

.1 Training Observations

a. Inspection Scope

The inspectors observed a simulator training evolution for licensed operators on September 14, 2011, which required emergency plan implementation by a licensee operations crew. This evolution was planned to be evaluated and included in performance indicator data regarding drill and exercise performance. The inspectors observed event classification and notification activities performed by the crew. The inspectors also attended the post evolution critique for the scenario. The focus of the inspectors activities was to note any weaknesses and deficiencies in the crews performance and ensure that the licensee evaluators noted the same issues and entered them into the corrective action program. As part of the inspection, the inspectors reviewed the scenario package and other documents listed in the attachment.

These activities constitute completion of one sample as defined in Inspection Procedure 71114.06-05.

b. Findings

No findings were identified.

4OA1 Performance Indicator Verification

.1 Data Submission Issue

a. Inspection Scope

The inspectors performed a review of the performance indicator data submitted by the licensee for the 2nd Quarter 2011 performance indicators for any obvious inconsistencies prior to its public release in accordance with Inspection Manual Chapter 0608, Performance Indicator Program.

This review was performed as part of the inspectors normal plant status activities and, as such, did not constitute a separate inspection sample.

b. Findings

No findings were identified.

.2 Reactor Coolant System Specific Activity (BI01)

a. Inspection Scope

The inspectors sampled licensee submittals for the reactor coolant system specific activity performance indicator for Palo Verde Nuclear Generation Station Units 1, 2, and 3 for the period from the third quarter 2010 through the second quarter 2011. To determine the accuracy of the performance indicator data reported during those periods, the inspectors used definitions and guidance contained in NEI Document 99-02, Regulatory Assessment Performance Indicator Guideline, Revision 6. The inspectors reviewed the licensees reactor coolant system chemistry samples, technical specification requirements, issue reports, event reports, and NRC integrated inspection reports for the period of third quarter 2010 through the second quarter 2011, to validate the accuracy of the submittals. The inspectors also reviewed the licensees issue report database to determine if any problems had been identified with the performance indicator data collected or transmitted for this indicator and none were identified.

Specific documents reviewed are described in the attachment to this report.

These activities constitute completion of three reactor coolant system specific activity samples as defined in Inspection Procedure 71151-05.

b. Findings

No findings were identified.

.3 Reactor Coolant System Leakage (BI02)

a. Inspection Scope

The inspectors sampled licensee submittals for the reactor coolant system leakage performance indicator for Palo Verde Nuclear Generation Station Units 1, 2, and 3 for the period from the third quarter 2010 through the second quarter 2011. To determine the accuracy of the performance indicator data reported during those periods, the inspectors used definitions and guidance contained in NEI Document 99-02, Regulatory Assessment Performance Indicator Guideline, Revision 6. The inspectors reviewed the licensees operator logs, reactor coolant system leakage tracking data, issue reports, event reports, and NRC integrated inspection reports for the period of third quarter 2010 through the second quarter 2011 to validate the accuracy of the submittals. The inspectors also reviewed the licensees issue report database to determine if any problems had been identified with the performance indicator data collected or transmitted for this indicator and none were identified. Specific documents reviewed are described in the attachment to this report.

These activities constitute completion of three reactor coolant system leakage samples as defined in Inspection Procedure 71151-05.

b. Findings

No findings were identified.

4OA2 Identification and Resolution of Problems

Cornerstones: Initiating Events, Mitigating Systems, Barrier Integrity, Emergency Preparedness, Public Radiation Safety, Occupational Radiation Safety, and Physical Protection

.1 Routine Review of Identification and Resolution of Problems

a. Inspection Scope

As part of the various baseline inspection procedures discussed in previous sections of this report, the inspectors routinely reviewed issues during baseline inspection activities and plant status reviews to verify that they were being entered into the licensees corrective action program at an appropriate threshold, that adequate attention was being given to timely corrective actions, and that adverse trends were identified and addressed. The inspectors reviewed attributes that included:

(1) the complete and accurate identification of the problem;

(2) the timely correction, commensurate with the safety significance;

(3) the evaluation and disposition of performance issues, generic implications, common causes, contributing factors, root causes, extent of condition reviews, and previous occurrences reviews; and

(4) the classification, prioritization, focus, and timeliness of corrective actions. Minor issues entered into the licensees corrective action program because of the inspectors observations are included in the attached list of documents reviewed.

These routine reviews for the identification and resolution of problems did not constitute any additional inspection samples. Instead, by procedure, they were considered an integral part of the inspections performed during the quarter and documented in Section 1 of this report.

b. Findings

No findings were identified.

.2 Daily Corrective Action Program Reviews

a. Inspection Scope

In order to assist with the identification of repetitive equipment failures and specific human performance issues for follow-up, the inspectors performed a daily screening of items entered into the licensees corrective action program. The inspectors accomplished this through review of the stations daily corrective action documents.

The inspectors performed these daily reviews as part of their daily plant status monitoring activities and, as such, did not constitute any separate inspection samples.

b. Findings

No findings were identified.

.3 Selected Issue Follow-up Inspection

a. Inspection Scope

During a review of items entered in the licensees corrective action program, the inspectors recognized corrective action items documenting issues that warranted further scrutiny.

• July 22, 2011, Units 1, 2, and 3, new emergency operations facility greater than NUREG 0696 limit

• July 27, 2011, Unit 3, essential chiller A low oil level The inspectors considered the following during the review of the licensee's actions:

(1) complete and accurate identification of the problem in a timely manner;

(2) evaluation and disposition of operability/reportability issues;

(3) consideration of extent of condition, generic implications, common cause, and previous occurrences;

(4) classification and prioritization of the resolution of the problem;

(5) identification of root and contributing causes of the problem;

(6) identification of corrective actions; and

(7) completion of corrective actions in a timely manner.

Specific documents reviewed during this inspection are listed in the attachment.

These activities constitute completion of two in-depth problem identification and resolution samples as defined in Inspection Procedure 71152-05.

b. Findings

Failure to Promptly Identify and Correct a Condition Adverse to Quality Associated with Operation of Essential Chillers

Introduction.

The inspectors identified a Green noncited violation of 10 CFR Part 50, Appendix B, Criterion XVI, Corrective Action, for the licensees failure to promptly identify and correct a condition adverse to quality associated with Unit 3 essential chiller A oil level. The condition adverse to quality involved inadequacies in plant operating procedures used to operate the chiller at low load conditions. As a result, the chiller was declared inoperable six times between July 27, 2011 and September 5, 2011 due to low oil level caused by oil migration into the refrigerant, a known phenomenon that occurs during low load conditions.

Description.

In February 2011, Unit 3 operators identified small amounts of seat leakage associated with the turbine-driven auxiliary feedwater pump steam admission valves that resulted in elevated pipe temperatures and higher temperatures in the pump room.

Beginning in July 2011, operators began running essential chiller A to supplement the normal ventilation in the pump room to maintain temperatures. Operators utilized Procedure 40OP-9EC01, Essential Chilled Water Train A (EC), to operate the essential chillers. On July 27, 2011, operators identified low oil level in the chiller, declared the chiller inoperable, and entered Technical Specification 3.7.10, Essential Chilled Water (EC) System. Operators added oil to restore oil level, declared the chiller operable, and continued operating the chiller. Oil level dropped five additional times between

July 27, 2011 and September 5, 2011, requiring entry into Technical Specification 3.7.10 each time. During this timeframe, the inspectors questioned the cause of the repeated issue. Plant personnel concluded the cause was due to oil migration into the refrigerant when the chiller is operated at low loads. After the condition was identified on September 5, 2011, the licensee removed the chiller from service to distill the refrigerant and recover the oil in order not to exceed previously established operational thresholds for the maximum amount of oil that can be present in the chiller.

In 2003, plant personnel revised Procedure 40OP-9EC01 in response to low oil levels identified in the essential chillers. The licensee recognized that operating the chillers at low load resulted in oil migration into the refrigerant and subsequent drop in oil level.

The revision limited operation of the chiller at low load to less than one hour, unless additional load is added, such as switching the control room ventilation from normal to essential. After the numerous issues with the Unit 3 chiller, plant personnel recognized that the procedure did not provide sufficient detail to direct operators to completely secure the control room normal ventilation after switching to essential ventilation. As such, operators continued to place inadequate loading on the essential chiller, resulting in continued oil migration.

The inspectors concluded the most significant contributor to this issue was the failure of the licensee to perform a timely, adequate evaluation of similar issues that occurred in Unit 2 earlier this year. Specifically, the licensee initiated an apparent cause evaluation on March 31, 2011 in response to similar issues that occurred on Unit 2 in December 2010 and January 2011 that resulted in an NRC violation. The inspectors noted that the apparent cause evaluation was not completed until July 20, 2011, almost 3 months after the typical expectation of 30 days. The inspectors also noted that the evaluation identified the procedural guidance added to Procedure 40OP-9EC01 had been ineffective in preventing the low oil conditions on the Unit 2 chiller. Also, the evaluation identified that personnel are unsure as to how much load is sufficient to recover the oil from the refrigerant. However, the evaluation failed to capture these deficiencies as a potential cause or initiate corrective actions to address them.

The inspectors challenged the licensees timeliness in evaluating and correcting the repeated issues with the Unit 3 essential chiller. Based on previous occurrences in other chillers and the licensees knowledge of the oil migration phenomenon, the inspectors concluded the licensee did not take prompt action to identify and correct the inadequate operating procedure guidance. The licensee implemented temporary procedure changes to the operating procedures for all units to provide more specific guidance on chiller operation at low loads.

Analysis.

The inspectors determined the failure of the licensee to promptly identify and correct a condition adverse to quality associated with operation of essential chillers was a performance deficiency. The inspectors concluded the performance deficiency is more than minor because it affected the equipment performance attribute of the Mitigating Systems Cornerstone objective to ensure the availability, reliability, and capability of systems that respond to initiating events to prevent undesirable consequences. The inspectors evaluated the significance of the issue under the Significance Determination Process, as defined in Inspection Manual Chapter 0609.04, Phase I - Initial Screening and Characterization of Findings, and concluded the finding was of very low safety

significance (Green) because the finding:

(1) is not a design or qualification issue;

(2) did not represent an actual loss of safety function of the system or train;

(3) did not result in the loss of one or more trains of non-technical specification equipment; and

(4) did not screen as potentially risk significant due to a seismic, flooding, or severe weather initiating event. The inspectors determined this finding has a crosscutting aspect in the area of problem identification and resolution associated with the corrective action program component because the licensee failed to take timely corrective actions after identifying inadequacies in the operating procedure during review of similar issues that occurred in Unit 2 P.1(d).

Enforcement.

Title 10 CFR Part 50, Appendix B, Criterion XVI, Corrective Action, states, in part, that measures shall be established to assure that conditions adverse to quality are promptly identified and corrected. Contrary to the above, the licensee failed to promptly identify and correct the adverse condition of an inadequate operating procedure for essential chiller operation. Specifically, between July 27, 2011 and September 5, 2011, Unit 3 operators ran essential chiller A in a low load condition, resulting in repeated low oil conditions, and did not take prompt action to revise plant operating procedures to ensure the condition was corrected. The licensee implemented a temporary procedure change to ensure sufficient load is placed on the essential chiller during operation. The licensee has not completed all corrective actions associated with this finding. Because this finding is of very low safety significance and was entered into the corrective action program as PVAR 3892184, this violation is being treated as a noncited violation in accordance with Section 2.3.2 of the Enforcement Policy:

NCV 05000530/2011004-03, Failure to Promptly Identify and Correct a Condition Adverse to Quality Associated with Operation of Essential Chillers.

4OA3 Event Follow-up

.1 Event Follow-up

a. Inspection Scope

The inspectors reviewed the below listed event for plant status and mitigating actions to:

(1) collect information necessary to communicate event details to NRC management for determination of the appropriate agency response;

(2) observe plant system parameters and status;

(3) evaluate licensee actions; and

(4) confirm that the licensee properly classified the event in accordance with emergency action level procedures and made timely notifications to NRC and state/governments, as required.

• August 6, 2011, Unit 1, reactor trip due to dropped control element assembly during surveillance testing Specific documents reviewed during this inspection are listed in the attachment.

These activities constitute completion of one sample as defined in Inspection Procedure 71153-05.

b. Findings

No findings were identified.

.2 Event Report Reviews

a. Inspection Scope

The inspectors reviewed the below listed Licensee Event Report and related documents to assess:

(1) the accuracy of the Licensee Event Report;

(2) the appropriateness of corrective actions;

(3) violations of requirements; and

(4) generic issues.

b. Findings and Observations

(Closed) LER 05000530/2010-003-00, Essential Cooling Water System Train A Inoperable due to Degraded Room Air Handling Unit On November 15, 2010, during the monitoring of quarterly vibration measurements, plant personnel noted increased vibration levels on the essential cooling water (EW)system train A pump room air handling unit (AHU). After further evaluation, the licensee determined that reasonable assurance did not exist that the supporting AHU would meet its mission time of 30 days. Accordingly, on November 16, 2010, Unit 3 Operations personnel declared the EW train A inoperable due to the degraded EW pump room AHU and entered Condition A of Technical Specification (TS) Limiting Condition for Operation (LCO) 3.7.7. The licensee concluded the condition was caused by several machined steps in the fan shaft that reduced the diameter of the shaft under the outboard fan bearing on the AHU. This condition subsequently led to the degradation of the outboard fan bearing. The licensee replaced the bearing and Unit 3 exited TS LCO 3.7.7, Condition A, on November 18, 2010.

The inspectors documented one finding associated with this event - for the failure of engineering personnel to promptly correct a condition adverse to quality associated with the AHU blower shaft dimensions. The inspectors dispositioned this finding as NCV 05000530/2010005-04, Failure to Promptly Correct a Condition Adverse to Quality for the Essential Cooling Water Room Cooler.

The inspectors reviewed the LER and identified no additional concerns. This LER is closed.

4OA5 Other Activities

(Closed) Notice of Violation (NOV) 05000528; 05000529;05000530/2010008-01, Failure to Correct and Prevent Recurrence of a Significant Condition Adverse to Quality Associated with the Emergency Diesel Generator Fuel Oil Transfer Pumps

a. Inspection Scope

On January 28, 2011 Palo Verde Nuclear Generating Station received a NOV for the failure of the licensee to correct a significant condition adverse to quality associated with the emergency diesel generator fuel oil transfer pumps. Specifically, from April 2009 to September 2010, the licensee failed to correct a water intrusion path to the motor termination box for the Unit 2 emergency diesel generator fuel oil transfer pumps, resulting in degraded electrical connections. The failure to take adequate corrective

actions was previously identified and documented as NCV 05000529/2009004-02. The NOV was issued due to the licensees failure to restore full compliance within a reasonable amount of time for a significant condition adverse to quality.

Inspectors reviewed licensee corrective actions associated with emergency diesel generator fuel oil transfer pump water intrusion to determine the appropriateness of the corrective actions and to determine whether any generic weaknesses existed in the licensees corrective action program. The inspectors discussed the corrective actions with licensee personnel. The topics discussed included adequacy of the corrective actions to restore compliance and the thoroughness of root cause evaluations including the subsequent reviews by the corrective action review board. The inspectors considered the root cause evaluation and the corrective actions sufficient to address both the technical issues associated with a water intrusion path to the motor termination box for the emergency diesel generator fuel oil transfer pumps as well as the weakness associated with implementing the corrective action program.

Specific documents reviewed during this inspection are listed in the attachment.

b. Findings

No findings were identified. This NOV is closed.

4OA6 Meetings

Exit Meeting Summary

On October 4, 2011, the inspectors presented the inspection results to Mr. D. Mims, Vice President, Regulatory Affairs and Plant Improvement, and other members of the licensee staff.

The licensee acknowledged the issues presented. The inspector asked the licensee whether any materials examined during the inspection should be considered proprietary. No proprietary information was identified.

4OA7 Licensee-Identified Violations

None

SUPPLEMENTAL INFORMATION

KEY POINTS OF CONTACT

Licensee Personnel

R. Barnes, Director, Regulatory Affairs

B. Berryman, Director, Business

J. Cadogan, Director, Plant Engineering

K. Chavet, Consultant, Nuclear Regulatory Affairs

E. Dutton, Director, Nuclear Assurance Department

W. Hettel, Plant Manager, Plant Operations

M. Lacal, Vice President, Operations Support

F. Lake, Director, Performance Improvement Department

M. McGhee, Department Leader, Nuclear Regulatory Affairs

D. Mims, Vice President, Nuclear Regulatory Affairs/Oversight

M. Powell, Director, Nuclear Fuel Management

M. Ray, Director, Emergency Preparedness/Security

M. Shea, Director, Safety Culture

J. Waid, Director, Nuclear Training

T. Young, Director, Communications

NRC Personnel

M.A. Brown, Senior Resident Inspector

J. Bashore, Resident Inspector

M. Baquera, Resident Inspector

G. Warnick, Senior Resident Inspector

LIST OF ITEMS OPENED, CLOSED, AND DISCUSSED

Opened and Closed

05000528;529;530/2011004- NCV Failure to Adequately Classify and Evaluate Conditions Adverse to Quality (Section IR12)

05000528;529;530/2011004- NCV Inadequate Operability Determination for Essential Chilled Water System Gas Voids (Section IR15)

05000530/2011004-03 NCV Failure to Promptly Identify and Correct a Condition Adverse to Quality Associated with Operation of Essential Chillers (Section 40A2)

Attachment

Closed

05000530/2010- LER Essential Cooling Water System Train A Inoperable due to 003-00 Degraded Room Air Handling Unit (Section 40A3)

05000528; 529; NOV Failure to Correct and Prevent Recurrence of a Significant 530/2010008-01 Condition Adverse to Quality Associated with the Emergency Diesel Generator Fuel Oil Transfer Pumps (Section 40A5)