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High-Level Waste TestimonyFebruary 4, 1999 Mr. Chairman and members of the Subcommittee, the Commission is pleased to present to you the ongoing efforts of the Nuclear Regulatory Commission (NRC) to increase our effectiveness in nuclear safety regulation. Continuous Improvement Through ChangeOverviewDuring our last hearing before this Subcommittee, on July 30, 1998, I described a broad range of proposed improvements in our regulatory programs, with particular emphasis on the NRC oversight of power reactor licensees. Our appearance before this Subcommittee played an important role in accelerating changes already underway at the NRC. On August 7, on behalf of the Commission, I issued a Tasking Memorandum to the NRC staff that established an aggressive agenda, including both short-term progress and longer term strategies. The overall goal of these reforms has been to maintain safety while reducing unnecessary regulatory burden, streamlining our regulatory processes, and enhancing our public credibility. Significant Accomplishments
The Commission is committed to completing and institutionalizing these and other changes in a manner that will ensure long-range NRC effectiveness. In part, we are ensuring this continuity through key rulemakings and Commission policy decisions that will guide future actions. In the larger sense, we are altering the culture of the NRC and ensuring long-term stability by incorporating these changes into our planning framework, which is built around our five-year Strategic Plan, our annual budgets and Performance Plans, and our dynamic Planning, Budgeting, and Performance Management (PBPM) process (which requires outcomes-focused operating plans for each program area). Organizational and Planning InitiativesRealignments to Increase Effectiveness and Efficiency As part of our efforts to be more effective and efficient and to reduce supervisory overhead, the Commission is realigning the three major NRC program offices.
Other headquarters and regional offices will transition to new organizational structures by the end of the fiscal year. In total, these realignments will eliminate 88 managerial and supervisory positions. The Commission has made notable progress in improving the NRC staff-to-manager ratio. When this effort was initiated in September 1993, the NRC had slightly over 700 managers and supervisors. That number has declined steadily, and the realignments described above will reduce it to 330 by the end of FY 1999. Based on the NRC staffing levels in the President's FY 1999 budget, we will achieve the stated Commission goal of an 8:1 staff-to-manager ratio. We also have decreased the overall number of NRC employees, expressed in terms of full-time equivalent (FTE) staff years, from 2985 in FY 1998 to 2896 in FY 1999. Through the NRC use of buyouts, early retirements, and attrition, we project that actual staffing levels will continue to decrease to about 2835 by the end of this fiscal year. This pace of controlled staff reductions will allow us to achieve FY 1999 and 2000 staffing level targets without compromising critical mission requirements. The NRC FY 2000 budget request of $471.4 million and 2810 FTE, recently submitted to Congress, will provide the necessary resources to continue the timely implementation of the important regulatory changes discussed in this testimony, while continuing to ensure the fulfillment of our public health and safety mission. Based on the operational and regulatory program efficiencies achieved and anticipated, our FY 2000 budget reduces the NRC staff by 175 FTE compared with FY 1998. We expect that, as we make our regulatory program more risk-informed and performance-based, we also will have opportunities to continue improving our overall operational efficiency and effectiveness through Planning, Budgeting, and Performance Management. There are, however, "up front" investments required to realign our regulatory approach and to put into place the supporting infrastructure that will yield future savings. The appropriateness of further reductions will be evaluated in terms of both meeting our public health and safety mission and responding to the needs of the regulated community. International Program Comparisons In response, we conducted a detailed review with our counterpart regulatory agencies in France, Japan, and the U.K. The results, which will be provided to the Congress as part of the final report, demonstrate that the nature and scope of specific regulatory programs in various countries differ substantially. Many U.S. programs, such as license renewal and operational experience evaluation, are not conducted in a substantive or formal way by other countries. Other programs, such as inspection, research, and high-level waste management, differ substantially in approach or infrastructure. Functions which, in the U.S., are performed under the umbrella of nuclear reactor regulation, in other countries reside in research or technical support organizations whose work may be given direction by the regulatory body. To be valid, any country-to-country comparison would have to take these factors into account. Moreover, infrastructure differences-such as the degree of standardization of reactor design, the placement of licensees in the public or private sector, or the number of licensees-generally are outside of NRC control, but account for substantial variations in resource levels. Differences in the NRC regulatory approach, while more within our control, are shaped largely by expectations from the Congress and the public. This includes such considerations as the degree of independent verification required for licensee activities and the degree of public participation in regulatory activities. Finally, each of the four countries has implemented or is considering major reorganizations and program reassessments. While each country can gain insights about the regulatory approaches used by others, the differences in industry and regulatory infrastructure, funding mechanisms, and stakeholder interests must be considered before drawing conclusions from broad comparisons. When these differences are considered, the apparent disparities in resource levels per unit of nuclear generation are diminished significantly. Planning, Budgeting and Performance Management The FY 1997-2002 Strategic Plan and FY 1999 Performance Plan were the initial PBPM efforts, and both documents received high marks from the Congress, the Office of Management and Budget, and the General Accounting Office. The FY 2000 PBPM process integrates the NRC Strategic Plan and Performance Plan more fully with our budget request. A recent Arthur Andersen evaluation, currently under NRC staff review, found that the NRC PBPM process is sound, and that it has improved our integrated planning efforts, consistent with the Government Performance and Results Act. In addition, the PBPM framework provides a means of ensuring the accountability of agency managers. We are applying the PBPM process in our three major program offices in planning our work and developing the budget for FY 2001. The continuing work of Arthur Andersen is helping us to develop outcomes-based measures as "filters" to evaluate, prioritize, and sunset activities. In the feedback process, which PBPM requires, these measures also comprise the actual metrics for gauging performance. Institutionalizing Change Shifting the Regulatory ParadigmRisk-Informed and Performance-Based RegulationThe Commission is overhauling the NRC regulatory approach to become more risk-informed and performance-based; to enhance safety focus; to improve effectiveness, efficiency, predictability, and scrutability; and to eliminate unnecessary regulatory burden in both the reactor and materials arenas. The accomplishments of the past six months demonstrate both an acceleration of existing efforts and the launching of new initiatives. We have increased stakeholder involvement, refined NRC internal practices, completed NRC pilot programs, and laid the foundation for risk-informing NRC reactor regulations over the longer term. Increased Stakeholder Involvement: The Commission has increased substantially the involvement of the nuclear power industry, public interest groups, States, and other stakeholders through public meetings, extended workshops, and the solicitation of public comments through the Federal Register and the Internet. Stakeholder input customarily has played an important part in the formulation of NRC policies-for example, the Probabilistic Risk Assessment (PRA) policy statement and the formulation and initial use of NRC guidance on risk-informed regulation. More recently, stakeholder interactions have become even more integral to the development of options for Commission consideration on risk-informed revisions to reactor regulations and proposed improvements to NRC reactor oversight processes. The Commission believes that this increased interaction will be of substantial benefit, by ensuring a mutual understanding of technical and safety issues, stimulating a healthy dialogue among all participants, promoting wider acceptance of our programs, and highlighting areas for additional research. Changes to NRC Licensing Action Review Practices: As part of our commitment to risk-informed regulation, we have changed internal NRC operating practices. This has included providing additional guidance, training, and management attention to ensure that risk-informed licensing actions are given the appropriate priority. The completion of numerous plant-specific risk-informed licensing reviews has helped to sharpen the focus on safety while reducing unnecessary regulatory burden. Two examples are:
In practical terms, these changes substantially reduce occupational radiation exposure, plant operational costs, and unnecessary shutdowns without adversely affecting public safety. Progress on Pilot Programs: Risk-informed pilot programs have been completed through the NRC review of prototypical license amendment applications. We have approved pilot applications in three areas: (1) graded quality assurance, (2) in-service testing of pumps and valves, and (3) in-service inspection of important reactor plant piping. In each of these applications, our consideration of risk information provided a strong basis for a graded treatment of the regulated activities at certain licensee facilities, which allows both NRC and licensees to focus resources on equipment and activities with the greatest risk significance. In another pilot application, the NRC reviewed certain requirements for post-accident hydrogen monitoring. By allowing more flexibility for the initiation of hydrogen concentration monitoring during an accident, reactor operator attention can be focused on more risk-significant matters. These pilots have demonstrated that the implementation of the risk-informed programs can be accomplished without a significant change in risk, and that an acceptable level of quality and safety will be maintained. Lessons learned from the pilots will be used to improve future applications and NRC reviews. Longer-Term Initiatives: The Commission is considering a proposal to redefine, in a broad-based manner, plant equipment needing special treatment in such areas as quality assurance, environmental qualification, operational controls, and engineering code requirements. The Commission also is considering a recommendation to "risk-inform" the complete body of power reactor regulations. In addition, we are facilitating the adoption of a risk-informed regulatory approach by making infrastructure changes through staffing and training, additional revisions to guidance documents, and the development of improved PRA methods. License Renewal The initial safety evaluation report and draft environmental impact statement for the Calvert Cliffs application should be completed on schedule next month. Last December, the Commission denied an appeal from the petitioner on the Calvert Cliffs application and affirmed the Licensing Board denial of a request for hearing. The petitioner has sought judicial review. In the absence of a hearing, the NRC anticipates completing its review and a Commission decision on the Calvert Cliffs renewal application by May 2000, 25 months after it was submitted. Regarding the Oconee application, the licensee responses to NRC requests for additional information are scheduled to be completed next month. Last December, the Licensing Board denied a request for hearing from the petitioner on the Oconee renewal application. The petitioner has appealed this ruling to the Commission. The NRC anticipates completing its review and a Commission decision on the Oconee renewal application no later than December 2000. We also understand that we will receive our next license renewal application in December 1999 from Entergy for their Arkansas Nuclear One plants. Other applications may follow quickly, and we have asked for sufficient resources in our FY 2000 budget to handle the anticipated new applications. Lessons learned from the initial reviews will help to streamline later reviews even further. License Transfers and Adjudicatory Processes The NRC has completed final Standard Review Plans (SRPs) for antitrust and financial qualifications reviews, and a draft SRP for foreign ownership issues. SRPs document the process and criteria to be used by the NRC staff in performing its reviews, which improves the focus, effectiveness, predictability, timeliness, and efficiency of the process. During the coming months, the NRC expects to complete timely reviews of license transfer requests from Three Mile Island Unit 1 and the Pilgrim station. The Commission currently is considering options for a more comprehensive streamlining of its adjudicatory processes. Concurrently, the Commission has been monitoring closely its adjudicatory tribunals to ensure appropriate adherence to the substantive and schedular provisions of the Commission Rules of Practice. Other Licensing-Related Issues Improvements to the 10 CFR 50.59 Change Process: In October 1998, the Commission published for public comment proposed revisions to 10 CFR 50.59. Under this regulation, licensees are allowed to make certain changes to their facilities without prior NRC approval. The revisions to the rule are intended to clarify NRC requirements and to allow changes that will have minimal impact on the facility licensing basis. These revisions will both improve the effectiveness of this regulatory process and reduce unnecessary NRC and licensee burden. The NRC staff currently is analyzing the public comments and expects to complete a final rule package for Commission review and approval within a few months. FSAR Guidance: Another NRC initiative is the development of guidance on updating final safety analysis reports (FSARs). The updated FSAR is used in routine safety analyses performed by the NRC, the licensee, and other interested parties. NEI, with significant input from the NRC, has developed a guidance document, outlining a voluntary process for removing excess detail from the FSAR, thereby simplifying both the FSAR and the updating process. We currently are considering a proposed regulatory guide that endorses this NEI document. That proposal should go out for public comment in the near future. Improved Standard Technical Specifications: The NRC has improved the timeliness of reviews for converting power reactor licenses to improved standard technical specifications. This conversion improves consistency in interpreting and applying these requirements. In total, licensees for approximately 89 reactors have decided to convert to the new technical specifications, which licensees have projected will save from $150,000 to over $1M annually per site. To date, applications to convert have been received from 57 units, of which 43 units have been given approval, 17 since July 1998. We expect to issue approvals for an additional 10 units during the remainder of FY 1999, which will eliminate the large backlog of applications under review over the last two years. Refining the Use of Generic Communications: In August 1998, the NRC staff met with stakeholders to ensure an understanding of concerns related to NRC generic communications. Based on the results of that meeting, we are clarifying the definition and purpose of certain types of generic communications, documenting the generic communication process, and resolving related compliance backfit issues. As part of this effort, we are reviewing proposed generic letters earlier, and at a higher management level, and engaging stakeholders earlier in the process. Improving the RAI Process: We have improved discipline in the process for requesting additional information (or RAIs) from licensees for license amendments and other NRC reviews. We have revised internal NRC guidance, trained appropriate NRC staff, held NRC staff and management accountable for the timeliness and quality of reviews, and developed an outline for general distribution that details the qualities looked for in licensee submittals. These efforts should help to reduce the need for, and the burden associated with, RAIs. Reactor Inspection, Performance Assessment, and Enforcement Assessment and Inspection Program Changes: The NRC staff has proposed to the Commission a new assessment framework, which builds upon the cornerstones of licensee performance that must be monitored to ensure that nuclear power reactor operations do not pose unacceptable risks to the public. The cornerstones support the NRC mission by ensuring that: (1) accident-initiating events are reduced; (2) accident mitigation systems are available, reliable, and capable of performing their intended functions; (3) barriers are sufficient to limit the release of radioactivity; (4) adequate emergency preparedness functions are maintained; (5) licensees have implemented adequate programs to protect the public and workers from radiation; and (6) security measures are in place to protect against sabotage. As part of the assessment framework, the NRC staff has identified performance indicators, performance indicator thresholds, and risk-informed inspections that would supplement and verify the validity of the performance indicator data. This assessment framework provides a natural basis for a risk-informed baseline inspection program-a program that identifies the minimum level of inspection required, regardless of licensee performance, to ensure adequate NRC oversight and assessment of licensee performance. Developed using a risk-informed approach, the proposed baseline inspection program includes a comprehensive list of inspectable areas within each cornerstone of the assessment framework. As currently proposed, the assessment process will integrate the performance indicators with the results of the risk-informed baseline inspections. This integration will allow the NRC to make objective conclusions regarding licensee safety performance, to communicate these results effectively to the licensees and to the public. Even more significantly, the process includes specific thresholds-tied to the cornerstones of safety-that will trigger commensurate licensee and/or NRC action if they are exceeded. The process will provide both continual and periodic assessment of licensee performance. We have developed these new processes through a series of stakeholder meetings with extensive and constructive dialogue. The overall proposal was forwarded to the Commission on January 11, 1999, and released for public comment the next day. On January 20, the Commission met with the NRC staff and stakeholders to discuss these proposals, which we are reviewing currently. Although the exact form of the final process is still under development, these broad-scale changes to reactor oversight clearly will result in several direct benefits:
We have made considerable progress in reshaping these NRC regulatory programs. As we transition our programs, we will make major process changes incrementally, to allow testing and adjustment during piloting and implementation. Much work remains in bench-marking, conducting pilots, developing procedures, and training the NRC staff on the new processes. In addition, several key policy issues still must be resolved, such as whether changes are needed in NRC responses to events at licensee facilities. Successful implementation will require continuing stakeholder involvement, as well as a significant investment of NRC staff and management resources. As currently proposed, the transition plan will include a six-month pilot at two sites in each NRC region, beginning this June. We will measure pilot program results against the success criteria and conduct a joint NRC-stakeholder workshop prior to full implementation. Existing processes, such as plant performance reviews and senior management meetings, will be replaced by the new risk-informed oversight process. The Commission already has suspended the Systematic Assessment of Licensee Performance (SALP) process, pending implementation of the new process. To verify that our objectives are being met, we plan to evaluate the revised oversight process after about one year of full implementation. Enforcement Program Changes: In parallel with these improvements to our assessment and inspection programs , the NRC has made several changes to its enforcement program to reduce unnecessary NRC and licensee burden. On July 27, 1998, we issued enforcement guidance to clarify our existing Enforcement Policy. The changes ensure that: (1) licensees are given appropriate credit for identifying and correcting violations; (2) NRC and licensee resources are not expended on violations that do not warrant formal citations; (3) written responses to Notices of Violation are not required when necessary information is already docketed elsewhere; and (4) cases involving multiple examples of the same violation are treated consistently. The agency-wide implementation of this guidance has resulted in a significant reduction in the number of low-level (Severity Level IV) violations, particularly in the number of violations requiring a written licensee response. On January 22, 1999, the Commission approved a change to the Enforcement Policy that will expand the use of non-cited violations. Except in limited circumstances, individual Severity Level IV violations now will not be cited , so long as they have been entered into the licensee corrective action program. Accordingly, the NRC inspection program will place more emphasis on assessing the effectiveness of licensee corrective action programs. This is consistent with the thrust of the risk-informed inspection process described earlier. In addition to these short-term enforcement program changes, the Commission expects that the Enforcement Policy will be changed and integrated with the risk-informed inspection and assessment processes. These changes should include an expanded policy supplement with violation examples that reflect more accurately the risk significance of potential violations in each topical area. Continuing ChallengesAlthough we have made substantial progress in redesigning our regulatory programs, much work remains in making these programs more effective and efficient. Our efforts are far from complete. In addition, we recognize that new challenges surely will arise as we revamp our programs and take nuclear regulation into the 21st Century. These continuing and future challenges include: We are working aggressively with the nuclear power industry and other
licensed nuclear facilities to ensure that their safety and security will
not be adversely affected by the Y2K problem; Conclusion
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