Protecting People and the EnvironmentUNITED STATES NUCLEAR REGULATORY COMMISSION
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1 UNITED STATES OF AMERICA
2 NUCLEAR REGULATORY COMMISSION
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4 BRIEFING ON IMPROVEMENTS TO THE
5 SENIOR MANAGEMENT MEETING
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7 PUBLIC MEETING
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10 Nuclear Regulatory Commission
11 One White Flint North, Room 1F-16
12 11555 Rockville Pike
13 Rockville, Maryland
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15 Thursday, April 2, 1998
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17 The Commission met in open session, pursuant to
18 notice, at 2:38 p.m., the Honorable SHIRLEY A. JACKSON,
19 Chairman of the Commission, presiding.
20 COMMISSIONERS PRESENT:
21 SHIRLEY A. JACKSON, Chairman of the Commission
22 NILS J. DIAZ, Member of the Commission
23 EDWARD McGAFFIGAN, JR., Member of the Commission
24 GRETA J. DICUS, Member of the Commission
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1 STAFF AND PRESENTERS SEATED AT THE COMMISSION TABLE:
2 JOSEPH CALLAN, EDO
3 SAM COLLINS, NRR
4 R. WILLIAM BORCHARDT, NRR
5 JIM LIEBERMAN, OE
6 ANNETTE VIETTI-COOK, STAFF
7 STEPHEN BURNS, STAFF
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1 P R O C E E D I N G S
2 [2:38 p.m.]
3 CHAIRMAN JACKSON: Good afternoon.
4 I would like to welcome the staff to brief the
5 Commission on the integrated review of the NRC assessment
6 process for operating commercial reactors.
7 The objective of this assessment is to assess
8 accurately the overall safety performance of all U.S.
9 commercial nuclear power plants to verify that they are
10 operating safely and identifying and promptly correcting the
11 underlying safety issues.
12 The review process also is intended to result in
13 an improved and less resource-intensive integrated
14 assessment process.
15 The proposed process needs to retain many of the
16 positive attributes of the current assessment processes,
17 which include Plant Performance Reviews, Systematic
18 Assessments of Licensee Performance, and the Senior
19 Management Meeting.
20 While these processes have served the agency well,
21 there are areas that warrant improvement, including
22 redundancy, use of different assessment criteria, and
23 decision criteria that are not well-defined and clearly
24 understood by the public.
25 The staff also will provide an overview of what
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1 they are doing in the area of management performance and
2 competency but not in any detail.
3 These initiatives are in partial response to a GAO
4 report.
5 The discussion of the options will include the key
6 characteristics, and I understand that copies of the slide
7 presentation are available and the staff paper on the
8 integrated review process is available at the entrances to
9 the meeting room, and so, unless my Commission colleagues
10 have any introductory comments, Mr. Callan, please proceed.
11 MR. CALLAN: Thank the Chairman. Good afternoon,
12 Chairman, Commissioners.
13 I think all of us at the table were in the
14 audience for the previous Commission briefing, and were
15 wondering who choreographed this, that we would follow, but
16 I think a lot of provocative points, comments were made on
17 both sides of the table earlier, and I think our
18 presentation will address most of them. If not, I think
19 they should be raised as questions.
20 Chairman, as you mentioned earlier with the ACRS,
21 this is a work in progress, and so, I guess the question is
22 why are we having this briefing with a work in progress?
23 The answer is not because we don't think we're responsive to
24 the SRMs. I think staff believes that the concept that
25 we'll be presenting is responsive to the many SRMs that have
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1 been issued on the subject, but in so doing, we have
2 introduced so much innovation, so much substantive change,
3 that it's our view that it's important to have a Commission
4 briefing at this point before additional resources are
5 expended on the project. I think it's important that we get
6 your feedback.
7 We have not crossed the resource rubicon, so to
8 speak. We still have recovery time here before the
9 important milestone dates arrive.
10 One last point I'd like to make is that most of
11 the innovation, surprisingly, most of the innovative
12 thinking, surprisingly, came from the grass-roots level,
13 from regional branch chiefs, ex-senior residents in the
14 headquarters and in the regions.
15 Ironically -- you know, unfortunately, we don't
16 have any regional representatives at the table here or in
17 the audience, but from my experience, ironically, most of
18 the enthusiastic support for the concept that you'll hear
19 about comes from the regional personnel who will be -- who
20 face the daunting task of implementing the concepts.
21 But as you know -- I think most of you know that
22 the staff is not monolithic in their support of the concept.
23 The concepts do represent substantial change. It's taken
24 most of us quite a while to -- a lot of reflection to
25 reconcile our own personal views on the subject, so I look
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1 forward to the discussion.
2 Bill Borchardt will lead the staff's presentation.
3 Bill?
4 MR. BORCHARDT: Good afternoon.
5 During today's brief, I'd like to provide a brief
6 description of the integrated review activities, of the
7 current conceptual framework that we've established, and the
8 future planned activities.
9 Six months ago we started on this project with a
10 particularly high level of excitement, and it continues, and
11 we're particularly looking forward to the interaction now
12 with all of the stakeholders to evaluate potential
13 improvements that have been identified through this new
14 process.
15 I'd like to reiterate what Mr. Callan mentioned,
16 that this is, indeed, just an initial concept developed by a
17 task force of approximately 15 people from the regional
18 offices and from a variety of headquarters offices, but
19 notably, over half of those have extensive in-field
20 inspection experience.
21 A good percentage of those were former senior
22 resident inspectors and are currently -- four of them are
23 currently branch chiefs or higher in the regional
24 organizations, and one of the requirements that the EDO
25 placed on us was to make sure that what we came up with had
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1 a chance of being implemented.
2 We didn't want something that was so theoretical
3 but yet unpracticable that it would it would prevent
4 meaningful implementation.
5 So, with this mix of people that we had on the
6 task group, we think we've come up with something that's
7 worthy of some serious consideration although dramatically
8 different from the way we do business now in a number of
9 areas.
10 The final proposal that, on our current schedule
11 would come to the Commission this summer, may be
12 significantly different from what's before the Commission
13 today, and this was intentional. We did not want to have
14 the process at this stage finalized by any stretch of the
15 imagination.
16 This has been purely an internal -- almost purely
17 -- we had one public meeting which I'll allude to, but it's
18 largely an internal staff process up to this point, and we
19 think now is the right time to engage all the stakeholders
20 -- the Commission, the public, and the industry -- to get
21 their input so that we can then refine the details and make
22 modifications as necessary.
23 The Commission paper that's available at the door
24 proposes a revised process with the objective to be more
25 scrutable, more consistently applied, and less redundant.
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1 It's not intended by itself, however, to
2 dramatically change our current regulatory approach,
3 although it will accommodate every single change to that
4 regulatory approach as it evolves over time.
5 Slide two, please.
6 The SALP, the Senior Management Meeting, and the
7 Plant Performance Reviews were each independently created at
8 various times over the last 20 years. They had a unique
9 purpose, and they are a unique process. However, they have
10 resulted in significant overlap, redundancy, and an
11 opportunity to send mixed messages to licensees and the
12 public.
13 This review constituted the first wide-scale
14 integrated review of the NRC's assessment processes. To a
15 large extent, the requirements that -- the top-level kinds
16 of objectives that the ACRS mentioned a while ago were
17 derived during this task group meeting from a list of 74 or
18 so separate requirements coming out of a variety of Staff
19 Requirements Memorandum and previous Commission papers.
20 Those 74 line items, requirements that the staff
21 considered, formed the basis for many of the boundary
22 conditions and the general criteria that were established
23 for acceptance criteria on the eventual process, and we have
24 checked the proposed process against those criteria
25 throughout the last six months.
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1 The proposals, I believe, directly address the
2 vast majority of those 74 issues, and I believe that it's a
3 dramatic improvement over the current process.
4 A side benefit of implementing this process or a
5 process similar to it would be that it will go a long way to
6 helping us improve the consistency and application of our
7 current programs, such as inspection and enforcement.
8 Slide three, please.
9 Beginning in September of 1997, with the
10 assistance of the Los Alamos National Laboratory Human
11 Factors Group, the task group used the approach shown on
12 this slide to develop the initial conceptual approach that
13 will be discussed in the following slides.
14 We held a series of team meetings to identify
15 objectives and critical attributes. These included the
16 high-level outputs, the required inputs to make those kinds
17 of decisions at an agency level, and the success attributes
18 of any eventual process.
19 The last point on this slide is one I've already
20 referred to but I think is one of the most important, and
21 that is that the process that we come up with, whatever the
22 eventual process is, I think it's absolutely mandatory that
23 it be able to have a implementation plan and a transition
24 plan that incorporates the insights from all the
25 stakeholders and allows a logical progression to this new
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1 process from what we have today.
2 CHAIRMAN JACKSON: Let me ask you a quick
3 question.
4 Are you prepared at this point or do you feel that
5 it's going to come out of essentially what the last bullet
6 implies to talk about the extent to which this either does
7 or should follow this kind of hierarchical kind of structure
8 that the ACRS talked about in its presentation?
9 MR. BORCHARDT: The Commission paper and the
10 presentation today don't take that directly on. However,
11 the task group had done many of the things that the ACRS
12 suggested, perhaps not to the formality and certainly not
13 documented to the extent that they would like to see,
14 although there is a several-hundred page report being
15 prepared, with the assistance of the contractor, that
16 documents all the steps and all the elements of the
17 activity, and I think that that would provide a number of
18 the answers.
19 One of the points the ACRS raised was the idea of
20 coming up with five, I think, the number they used, options
21 to meet the high-level criteria that were established.
22 I would argue that, during the course of those
23 four meetings, we came up with far more than five possible
24 options.
25 However, we never took the time to write those
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1 down, because it was a very dynamic, evolving process with
2 those 15 people, always cross-checking against the
3 high-level criteria, and as the different options were
4 identified, some elements of them were incorporated into one
5 option that kept moving forward, and it's this option that
6 you see presented in the --
7 CHAIRMAN JACKSON: So, are you arguing that these
8 high-level criteria that you developed early on or were
9 operating from really were linked to what the goals and
10 objectives were?
11 MR. BORCHARDT: We started with what are the kinds
12 of decisions the agency needs to make as it does an
13 assessment process? What kind of decisions does the
14 Commission and the staff both need to make, and what
15 information do we need in order to make that decision?
16 That was the first meeting. That was a week-long
17 meeting, really, of going through all of those elements and
18 coming up with the objective that you'll see in the SECY
19 paper in a couple slides.
20 CHAIRMAN JACKSON: Mr. Collins, were you going to
21 make a comment?
22 MR. COLLINS: In addition to what Bill has already
23 indicated, which I agree to, it's important, I believe, to
24 note that, as articulated in any section of the Commission
25 paper, there was a strive to start from a point of creating
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1 a balance between what exists within the current programs
2 that we have, which are multiple and somewhat redundant,
3 that are positive attributes, and what are the negative
4 attributes, and those were built into the process or avoided
5 as a result of this process itself being built.
6 The fact that we are dealing with one process
7 makes perhaps some people uncomfortable given that one size
8 does not necessarily fit all as far as either regulatory
9 challenges or even the tools that deal with those
10 challenges.
11 An attempt by using one process and making it
12 efficient is that you gradate the approach or you gradate
13 the agency's response using that one process, and therefore,
14 you deal, in fact, at different levels or different response
15 levels based on the data that's achieved using our existing
16 programs, and therefore, you're able, in effect, to address
17 multiple areas.
18 Whether it be based solely on routine inspection
19 findings and a level of attention that's at a regional level
20 or whether it be the result of an annual aggregated meeting
21 at the Commission level and result in an order, it's still
22 the same process that leads you to one result or the other,
23 but it's a graded approach.
24 CHAIRMAN JACKSON: How does that tie into what
25 your overall goals are or what our overall goals are as laid
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1 out in our strategic plan and objectives, you know, that we
2 as an agency, from the safety perspective, really have? I
3 mean is that clear, or is that going to -- to be fleshed out
4 later, or is that coming in this 100-page paper or
5 multi-hundred-page paper you're talking about?
6 MR. BORCHARDT: I think it's more clearly
7 discussed in the more detailed description of the task
8 group's activities.
9 Slide four shows the --
10 CHAIRMAN JACKSON: Excuse me.
11 COMMISSIONER McGAFFIGAN: I just want to ask a
12 question at the outset.
13 You've come up with a plan, and the goal at the
14 moment appears to be at staff level to perfect it and
15 whatever, but how open are you to comments to the effect --
16 why don't you just go back to where we are at the moment and
17 try to improve it incrementally as opposed to making this
18 leap?
19 It's conceivable to me, based on the stakeholder
20 comment I've heard privately, based on the presentations
21 you've made to the ACRS, the ACRS comments earlier, that you
22 may have a very small number of people enthusiastically
23 behind this other than your task force, and so, you may have
24 to find other alternatives.
25 Are you open to that, or is it take this --
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1 MR. BORCHARDT: At this stage, I think we're
2 largely open to all comments.
3 MR. CALLAN: I was going to say, that's why we're
4 doing the briefing now and not two months from now, three
5 months, because we do have recovery time. I mean not a lot,
6 but -- we don't have much margin, but to the extent we get
7 substantive comments back from the Commission, there is
8 time, and that's why this meeting was scheduled.
9 MR. COLLINS: I would add, in answer to your
10 question, Commissioner McGaffigan, that no matter what
11 course we embark on -- and as Bill admitted, this is a
12 fairly radical approach -- it's important, as the ACRS
13 articulated, that if the staff had a certain set of goals
14 and assumptions in mind when this approach was formulated, I
15 believe it would be most efficient, if this staff -- if this
16 position, rather, were not accepted, for the staff to
17 understand on what bases should an alternate position be
18 considered, and is the rationale or the assumptions by which
19 this position was formed still valid, and therefore, are we
20 dealing just with a methodology, or are we dealing with a
21 difference in basic assumptions?
22 CHAIRMAN JACKSON: Moreover, let us not forget
23 that, in fact, the Commission asked the staff to do this, to
24 take the integrated review, to look at eliminating
25 redundancy and overlap, etcetera, etcetera, and so, we have
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1 to evaluate what they are proposing, but it's always
2 important to have a historical perspective.
3 COMMISSIONER McGAFFIGAN: You could ask for
4 something, and then, as Mr. Callan has said, you can decide,
5 well, you know, we asked for a fire protection standard that
6 the risk-informed performance-based rule --
7 CHAIRMAN JACKSON: Right. I think, at this point,
8 there isn't unanimity of opinion here. So, I think we'll
9 just have to hear what he has to say.
10 MR. CALLAN: But at one point in time, I think we
11 collectively thought something was broken that we had to
12 fix, and we think that this process does fix and mitigate
13 the worst vulnerabilities in our previous system.
14 Now, granted, we have enhanced that system, that
15 process considerably since a year ago, but there's a limit
16 to how much we can enhance the current process without
17 somewhat of a paradox shift, and this certainly provides
18 that.
19 MR. COLLINS: Chairman, I don't think it's good
20 form to leave any question about the strategic plan
21 unanswered. So, let me briefly respond to your question
22 about the nexus between the strategic plan and where we are
23 here today.
24 There is a direct connection, and it gets very
25 detailed when you go down into the NRR operating plan, and
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1 of course, there's a nexus with AEOD and there's cross-cut
2 issues that go all the way to regulatory effectiveness.
3 Our mission areas of which we have program
4 managers assigned would be the inspection, the assessment,
5 and the licensing area, as far as NRR is concerned. Of
6 course, there's a cross-cut assessment area with Tim and his
7 people in AEOD in the evaluation of data.
8 Each of those areas is a major input into the IRAP
9 as proposed.
10 How that ties in would be comments on licensing
11 actions, for example. The quality, the timeliness of
12 licensing actions would end up to be an item in the Plant
13 Issues Matrix which, by this process, would be considered in
14 the overall rack-up of licensee performance.
15 Inspection findings are one of the main areas that
16 the PIM would focus on, and of course, the assessment
17 process is what we're talking about here today.
18 Each of those roll up into the inspection,
19 assessment, and licensing program, which are very
20 fundamental building blocks for the overall program areas,
21 as well as the performance goals and the strategic plan.
22 The concept would be to have any process which is
23 defined be able to fit those existing building blocks, and
24 then, based on the results of the application of those
25 building blocks to the process, there will be refinements,
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1 and it's intended that this process allow those areas to be
2 very scrutable.
3 Enforcement will be very visible. Any
4 inconsistencies in inspection and inspection findings will
5 be very visible, and licensing action quality will become
6 very visible, because they will be shared and they will be
7 the basis for assessment.
8 I believe that's, although a not very obvious
9 attribute of this process, it is, nonetheless, a very
10 significant attribute.
11 CHAIRMAN JACKSON: Why don't we go on?
12 MR. BORCHARDT: Slide four shows a list of the
13 task group members. I'll go right to slide five now.
14 CHAIRMAN JACKSON: Well, before you do that, were
15 there any staff members with risk or PRA experience or
16 expertise on the team?
17 MR. BORCHARDT: Mike Parker is one of the SRAs in
18 training from Region III, and Mark Dapas, although a branch
19 chief now, was previously in the SRA program.
20 CHAIRMAN JACKSON: I note that Research is notably
21 missing. Is there a reason?
22 MR. CALLAN: Well, to be fair, Research has been
23 very active in other parts of the SMM enhancements, and this
24 particular aspect -- keep in mind, you know, this is one
25 part of an overall process.
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1 CHAIRMAN JACKSON: I understand.
2 MR. BORCHARDT: On slide five, through a review of
3 the relevant SRMs, previous lessons learned types of
4 reviews, and the personal experience of the individual task
5 group members, boundary conditions were established for the
6 assessment review.
7 This listing on page five is only a partial
8 listing. It's somewhat illustrative.
9 And they reflect, to a large extent, the task
10 group's vision of the interpretation of those SRMs and what
11 they meant to the NRC's regulatory responsibility, and so,
12 the group felt that all plants must be periodically
13 evaluated, whatever the interval was, that every plant in
14 the country needed to go through this process, that the
15 process must maintain a clear focus on assessing licensee
16 performance against regulatory requirements.
17 COMMISSIONER McGAFFIGAN: Could I ask -- on that
18 item, because that gets interpreted a couple pages later,
19 saying the assessment process will not be designed to
20 distinguish between levels of performance that meet or
21 exceed,
22 MR. BORCHARDT: Right.
23 COMMISSIONER McGAFFIGAN: I don't know whether the
24 boundary condition leads to that result or that's an
25 additional boundary condition in the form of a principle
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1 that comes along later, but it's one that gives me
2 misgiving, and I haven't hidden that at any point in this
3 process.
4 It sounds like the staff -- if I interpret the
5 reds, greens, and yellows that are going to come later,
6 green is a current 2 in SALP space, yellow is probably a
7 2.5, and red is a 3, but we give up on trying to identify
8 the 1's, and I have a little bit of misgiving on that. INPO
9 manages to do it, and you guys are, in this proposal,
10 basically walking away from it.
11 MR. CALLAN: It gives me some misgivings, also, I
12 think, a lot of us. Let me just give you two perspectives.
13 One is we're not very good at it, and our
14 processes don't lend themselves for making that very
15 difficult agonizing decision, and there are great
16 consequences for being wrong.
17 If you declare a plant as a good performer, then
18 our processes have us back off in the inspection effort, so
19 the consequences for being wrong are great, and we're not
20 good at it, and our inspection program doesn't develop a
21 solid basis for making a judgement.
22 COMMISSIONER McGAFFIGAN: One of the good
23 consequences, if we're in budget constraint space, is that
24 we free up some resources at a plant that we think may be
25 pretty darn good and can utilize those resources someplace
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1 else.
2 If we get rid of the one category, effectively,
3 the top-performing category, and we're going to homogenize
4 our resources and perhaps mis-apply them because we're
5 unwilling to make the judgement that somebody's pretty good
6 -- you all have to tell me whether there are a lot of
7 instances of people jumping from 1 to 3 space in a very
8 rapid fashion.
9 MR. CALLAN: There are, and it happens sometimes
10 when we change senior residents. It does happen.
11 There's resource dimension to this, also. We
12 spend probably an equal amount of resources agonizing over
13 whether a plant is an outstanding performer as we do whether
14 a plant is a poor performer. That decision is often more
15 difficult than the lower-performance decision, primarily
16 because we have a lot more data on the lower end than we do
17 the higher end.
18 But because the consequences of being wrong, if
19 you make the decision wrong on the high end, is so great, we
20 have to spend the resources to make it, and sometimes we do
21 inspection activities to try to parse that decision, whether
22 a plant is outstanding or good, and is that a good,
23 reasonable expenditure of resources?
24 COMMISSIONER DIAZ: Let's say that there is a
25 layer of good, adequate performers, and you say the
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1 consequences of being wrong are great. Have there ever been
2 any consequences of -- you know, I mean major consequences
3 of being a little wrong in assessing somebody better than
4 what it is?
5 MR. CALLAN: Yes.
6 COMMISSIONER DIAZ: Which one?
7 MR. CALLAN: Last Thursday or Wednesday, Congress,
8 in testimony at the Rayburn Building, reminded us of a GAO
9 report that documented a couple instances where that had
10 occurred, and from my experience as regional administrator,
11 I think GAO had highlighted the Cooper experience as an
12 example of that. It does happen.
13 COMMISSIONER DIAZ: It transitions rapidly from --
14 MR. CALLAN: No, no. The question isn't whether
15 their performance transitions. The question is, was the
16 staff wrong in making the judgement that they were a good
17 performer, and then consequently backing off inspection
18 effort, and then you build in a self-fulfilling prophecy
19 syndrome where you assess a plant as being a good performer,
20 you reduce inspection effort, which perpetuates the notion
21 that they're a good performer.
22 COMMISSIONER DIAZ: What were the great
23 consequences apart from being publicly noticed? When you
24 say great consequences in the context of a nuclear power
25 plant, I am thinking of great -- is that a partial core
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1 melt-down?
2 MR. CALLAN: No. As the GAO noted in the case of
3 Cooper, the consequences were a shutdown of the plant for
4 over a year that perhaps could have been avoided had their
5 declining performance been engaged earlier. That's a
6 consequence that, had their declining performance been
7 engaged sooner, that may have been headed off.
8 COMMISSIONER DIAZ: Would you say that the NRC has
9 the expertise to -- and maintains the regulatory structure
10 to be able to distinguish between, you know, safety as it
11 pertains to adequate protection and other issues that might
12 deteriorate and result in a plant shutdown without any
13 safety consequences?
14 MR. CALLAN: Well, as you know, Commissioner, our
15 regulatory regime is directed at identifying declining
16 performance before it's manifested in situations that would
17 threaten the health and safety of the public.
18 So, the whole -- I mean the figure of merit is to
19 engage declining performance at its early stages, before
20 they're manifested in the way you describe, and sometimes
21 you engage the declining performance when the declining
22 performance is manifested as a regulatory problem, the stage
23 of where it's manifested as a regulatory problem, not as
24 really a safety problem.
25 But that's the frontier that we try to engage
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1 performance problems, and we're not always successful.
2 Sometimes we miss declining performance, and then that
3 performance will be manifested in the way you described as a
4 more safety-significant issue, like a transient of some
5 sort.
6 MR. COLLINS: Let me just add, against this
7 backdrop, the fabric that we're dealing in is that this is
8 truly a policy decision.
9 When the staff got together and came up with the
10 attributes of the IRAP, as you know -- in fact, we've had
11 previous discussions -- this process is deeply embedded in
12 our regulatory processes as providing for inputs into this
13 area, and it's pretty much limited to that, and the staff
14 did that intentionally.
15 Any moving up or out, if you will, of our normal
16 processes, some which would include -- and it's debatable,
17 but some which would include the application of our programs
18 to measuring good performance as opposed to regulatory
19 performance, is looked at as truly a policy decision.
20 I think the input to that policy decision is much
21 of what we have talked about here today. It drives
22 inspection resources, it drives the perception of what the
23 agency's mission is, do we have the attributes to be able to
24 perform that function consistently?
25 Some of those have been built into the SALP
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1 program historically. It's probably arguable about whether
2 that's done well or not, but clearly, if the staff were
3 directed to go back and re-address that area as a policy
4 decision, we have the attributes identified to do that.
5 COMMISSIONER McGAFFIGAN: Could I just try to nail
6 down this Cooper situation? Were they a straight SALP-1
7 plant when they got into trouble?
8 MR. CALLAN: Well, at one point in time, Cooper
9 was more or less a SALP-1 plant. Then their performance
10 started declining.
11 When it exactly started declining, I'm not sure,
12 but the regulatory processes -- because they were SALP-1,
13 the inspection program there was a minimum program, their
14 performance started declining, and the inspection program
15 lagged their actual performance, and performance had
16 declined to the point where it took an outage, as I said, to
17 remedy the problems.
18 COMMISSIONER McGAFFIGAN: The question I have is,
19 you know, if we're responsible for every outage, then, you
20 know, Quad Cities, Indian Point 2 -- and I don't know who
21 else is in outages at the moment -- there's Fermi, whatever
22 -- who else is in the outage because of the --
23 MR. COLLINS: We have D.C. Cooke, Clinton Station.
24 COMMISSIONER McGAFFIGAN: Are we supposed to be
25 able to -- does GAO expect us to be able to be so good that
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1 we arrest everything before they ever have to get into an
2 extended outage to fix anything? Because if that's the
3 standard, it's impossible.
4 MR. CALLAN: No, I'm sorry, I wasn't trying to
5 imply that GAO was setting our thresholds, but they simply
6 documented an episode that occurred, and that's a difficult
7 question. I lived through the Cooper experience, and I
8 believe that we were probably one to two SALP periods behind
9 them, but -- one-and-a-half to three years behind actual
10 performance.
11 Now --
12 CHAIRMAN JACKSON: Well, I think we have to be a
13 little careful here. The issue is the following, from my
14 perspective.
15 You know, what is a regulatory agency's job, and
16 is it meant to be preventative or is it meant to be
17 remedial? And the question is one that, you know, it rests
18 at a fundamental policy level which the Commission has to
19 make a decision about, but the Commission, for many years --
20 and it pre-dates any of us -- has always operated from the
21 point of view that -- and we're working to make the
22 regulatory requirements as risk-informed as we can make them
23 but that conformance with them is the presumptive assurance
24 of adequate protection.
25 Now, if the Commission wants to change the
26
1 thresholds as to where that is, that's within the
2 prerogative of the Commission, but given that, then you
3 cannot ask the staff to wait until there's public health and
4 safety consequence to take the action.
5 COMMISSIONER McGAFFIGAN: I'm not arguing that.
6 CHAIRMAN JACKSON: So, then the question we are
7 really arguing about is where is that threshold relative to
8 taking action before there's public health and safety
9 consequence, and so, I think we should not necessarily give
10 them a hard time based on operating within a regulatory
11 fabric that has formed the basis of how the agency has
12 performed and carried out its mission for years.
13 If we want to change it, that is the prerogative
14 of the Commission to change it, and so, I think that's
15 really --
16 COMMISSIONER McGAFFIGAN: Joe warned me that the
17 staff meeting that was preview to this was a pretty raucous
18 meeting and maybe the Commission will be, as well, but I'm
19 not arguing that at all.
20 I'm arguing that we follow our historical
21 practice, which is to recognize superior performance, and I
22 would want --
23 CHAIRMAN JACKSON: Right. But I think that's an
24 argument and an issue in terms of gradation that can be
25 recommended to the group to bring as an option to the
27
1 Commission, and then the Commission can decide if, in fact,
2 it wants that additional gradation.
3 If we want it and want to ensure that the resource
4 expenditures are put into it, we could make that decision,
5 and we can tell them to do that. We can tell them to do it
6 coming out of this meeting. We can tell them to do it as a
7 consequence of developing votes or an SRM on the paper. But
8 that's a decision. And all they've said is that they've
9 stepped out this way. If we want further gradation, we can
10 ask them to do it. If we want something else, we can ask
11 them to do it. And so, that may be, in fact, an option that
12 comes out of --
13 MR. BORCHARDT: If I could try to summarize, to
14 the best of my recollection, five of the major points that
15 were discussed, that led us to the conclusion that we did,
16 that we ought not to try to recognize superior performers,
17 that responsibility was not viewed by us as being a true
18 regulatory responsibility.
19 The criteria for establishing excellent or
20 superior performance does not exist currently. In fact, as
21 you mentioned, others do it already, and therefore, we
22 question the need for us to have to do it separately. There
23 are resource implications in order to do that.
24 This is related, but there's a risk of distraction
25 from what we thought was the most important job that we had
28
1 and that was to identify safety problems and to get them
2 corrected, and for all the time that we spend trying to
3 differentiate a good performer versus a superior performer,
4 that's time that we're not looking for what might truly be
5 significant safety problems, and we didn't want to do
6 anything to distract ourselves from that.
7 CHAIRMAN JACKSON: Commissioner Diaz.
8 COMMISSIONER DIAZ: Going away from the superior
9 to normal, I think that, really, what is indispensable --
10 and maybe it's not coming out -- is that, in this process, I
11 personally would like to preserve the prerogative that the
12 staff always had in saying I am going to put fewer resources
13 in this plant.
14 MR. BORCHARDT: And that still exists.
15 COMMISSIONER DIAZ: And so, you know, that is what
16 should be clear, because you know, gradations are
17 gradations, but it is important that we do focus on the
18 safety issues, and it's important that the staff has the
19 ability within whatever it is, and the fact is you do that
20 today. So, it's not like a new issue.
21 What you might want to do is frame it in a little
22 more structured sense, but from my viewpoint, it is
23 indispensable that we will be able to focus resources.
24 CHAIRMAN JACKSON: I agree with Commissioner Diaz,
25 and I think a difficulty has been -- and it's one that --
29
1 since we all are talking about where we've had discomfort in
2 what we see to this point, I think what has never been
3 totally married into this as part of the family is some
4 senior management review or what the role of that's going to
5 be and at what point in this process and how that determines
6 what the agency is going to do.
7 That is, does it mean we apply some additional
8 regulatory tool, does it mean we change our inspection focus
9 or inspection intensity, etcetera, and I think what's been
10 -- the focus has been on the PIM process and how that all
11 works, and we need to get through this or we never will get
12 through it, but I think that may be, you know, what the
13 missing element is, and whether you call it greens and then
14 deciding, among the greens, what you're going to do or
15 whether you call it the reds and you decide among the reds
16 what you're going to do, then I think that's the point that
17 needs some clarity, as opposed to saying whether you're
18 going to call them superior, you know, good guys or bad
19 guys.
20 MR. BORCHARDT: There's a very definite role for
21 senior management. There's several slides in here that will
22 get me to that point.
23 CHAIRMAN JACKSON: Okay. So, don't we try to let
24 him walk through this?
25 MR. BORCHARDT: I'll leave the boundary condition
30
1 slide. I'd like to reiterate once again the point on the
2 last bullet there, that the process that we come up with, we
3 think, needs to be able to accommodate any new tools, and
4 we've listed a couple there on that slide.
5 COMMISSIONER McGAFFIGAN: The current process, I
6 think, can accommodate all of these new tools. I don't want
7 to sound totally wedded to the status quo, I think it can be
8 improved, but a lot of these attributes are attributes of
9 the current process.
10 MR. COLLINS: I agree with that, Commissioner
11 McGaffigan, but as a later slide will indicate, a change in
12 one process will cause a redundant change in multiple
13 processes as a result of the overlap we have now. That does
14 not mean that a streamlining of the existing processes would
15 create that same problem, but currently that does exist.
16 MR. BORCHARDT: Slide six, please.
17 The desired attributes of the new process were
18 established early in the efforts. These were also developed
19 through a review of the SRMs and the experience with the
20 current programs, including insights gained through conduct
21 of the region-based job task analysis and insights gained
22 from our November public meeting with NEI and UCS.
23 CHAIRMAN JACKSON: How will risk significance be
24 derived? I mean is it going to come from enforcement
25 severity level? Is it a template overlay? I mean how is
31
1 that going to be done?
2 MR. BORCHARDT: Well, I think risk significance is
3 becoming an increasingly important element of our day-to-day
4 activities, and right now, it starts with how we choose the
5 sample of what we look at, how we do our inspections, and
6 now that we have SRAs in each of the regions, it's becoming
7 more and more influenced by the SRA's activities, and we're
8 using those people as a resource.
9 As inspection findings are identified, those same
10 people -- and we have -- a quarter of the residents
11 throughout the country have been to the PRA training, and
12 so, 25 percent of the sites now have residents that have
13 gone through that training, and that training is continuing.
14 CHAIRMAN JACKSON: All by the end of the year,
15 right?
16 MR. BORCHARDT: That's right. That's the goal,
17 and we're on track to meet that. And so, they bring that
18 knowledge to their every-day activities. When they have an
19 inspection finding, they use that knowledge and they use the
20 assistance of the SRAs in the regions --
21 CHAIRMAN JACKSON: Do you use it to determine what
22 their core inspection modules look like in the first place?
23 MR. BORCHARDT: The core inspection modules are
24 being revised right now -- in fact, we have drafts with -- I
25 have an SRA in my branch that has updated and made revisions
32
1 to all the core inspection procedures, and those are being
2 revised.
3 There's a new appendix that provides PRA guidance
4 to the inspectors as part of the inspection program. So,
5 the information is getting out there, and it's being used.
6 CHAIRMAN JACKSON: So, it's going to have them
7 focus more.
8 MR. BORCHARDT: On everything they do.
9 CHAIRMAN JACKSON: Okay.
10 MR. BORCHARDT: I think the view of the group was
11 that we can't use this IRAP to inject from nowhere risk
12 insights. If it doesn't start at the very bottom and work
13 its way up and is integral to everything we do, then it's
14 not going to work.
15 CHAIRMAN JACKSON: Okay.
16 MR. COLLINS: Including enforcement, I might add.
17 COMMISSIONER DIAZ: I've been preempted.
18 MR. COLLINS: I wanted to get that word in first.
19 MR. MARTIN: Can I also jump in here that Research
20 is actually developing a technique to take the information
21 in the PIM and, as it's moved into the template for analysis
22 purposes, that it be risk-informed at that part.
23 The techniques are not finalized yet, but they've
24 been working on that some time, and we can substantially
25 enhance the assessment of the overall inspection results
33
1 with risk insights at that point, given that the information
2 has been captured, the risk-significant information has been
3 captured in the inspection process and documented into the
4 PIM.
5 CHAIRMAN JACKSON: Okay. So, let me make sure I
6 understand.
7 So, you're arguing that the inspection program
8 itself is being risk-informed in the way that you just
9 described, both in terms of what the core inspection
10 procedures are as well as the actual training of the people
11 who have to carry them out, and then Sam's side comment said
12 that, in fact, the enforcement program is also being --
13 having risk insights --
14 MR. COLLINS: I made that comment looking at Jim
15 Lieberman, who was nodding his head.
16 CHAIRMAN JACKSON: Then you're saying, finally,
17 you're developing this additional methodology having to do
18 with how the PIM entries get migrated from the PIM to the
19 template.
20 MR. MARTIN: That's correct. Research is doing
21 that activity.
22 CHAIRMAN JACKSON: Please.
23 COMMISSIONER DIAZ: There is a mathematical
24 technique, and let me just bring on in and see if I can
25 understand this.
34
1 In a risk-informed process, when you make your
2 assessment, if you really could find something that is a
3 non-risk-significant item, will its value be close to zero
4 as far as being considered in your template?
5 MR. BORCHARDT: Yes.
6 COMMISSIONER DIAZ: All right.
7 MR. BORCHARDT: I don't want to make you too
8 optimistic, because part of the mix is the enforcement
9 action that was taken in the integrated review activity.
10 COMMISSIONER DIAZ: And my question, will a
11 resistor be placed in the enforcement category so that it
12 be, quote, risk informed, the enforcement action?
13 MR. CALLAN: Jim Lieberman just revised one of his
14 guidance memos.
15 Right, Jim?
16 COMMISSIONER DIAZ: He just put himself at risk.
17 CHAIRMAN JACKSON: No, he didn't, because this is
18 a kind Commission.
19 MR. LIEBERMAN: Well, risk is -- like in the
20 inspection process, risk is becoming more a consideration
21 every day. We have revised guidance out to consider risk.
22 We're using risk to increase severity levels. We're using
23 risk to lower severity levels.
24 If a violation has zero safety significance, zero
25 risk, that should be a minor violation, but when we look at
35
1 the severity level of the violation, there's three things we
2 look at. We look at the actual consequences, the potential
3 consequences, and the regulatory significance.
4 So, some issues may -- for example, involving
5 integrity, willful violations -- that may take something
6 which is a very minor risk but because of the integrity
7 issue, that may raise it.
8 But if the bottom line on the issue is there's no
9 safety significance, then that should be a minor violation.
10 I believe that's going to be counted as a zero in the
11 system.
12 COMMISSIONER DIAZ: Thank you.
13 CHAIRMAN JACKSON: Yes, please.
14 COMMISSIONER McGAFFIGAN: We were talking about
15 resources earlier, and we've got -- you know, somebody from
16 industry watching this discussion would say, well, you know,
17 what about the tremendous increase in severity level four
18 violations the last year or two, and we spent a lot of
19 resources.
20 If we're now, under the new system, going to worry
21 about whether it's a zero or -- I don't know where the
22 severity level four gets counted at -- I'm going to
23 adjudicate and expect higher management attention to all
24 these severity level fours in order to get them down to zero
25 if, in the view of the licensee, they have zero risk or
36
1 safety significance, as they oftentimes say on the pages of
2 Inside NRC or Nucleonics Week, but you may be creating an
3 enormous resource burden on yourselves with -- how many
4 thousand severity level fours are there -- 2,500, 3,000?
5 MR. CALLAN: Over 2,000.
6 COMMISSIONER McGAFFIGAN: At the moment, those
7 maybe don't get adjudicated very much. Maybe people take
8 their lumps and say it was a minor violation but let it go
9 through. But under this new system, I suspect they're going
10 to fight it.
11 MR. LIEBERMAN: I'm not aware of the level fours
12 increasing. The escalated actions have increased. I have
13 not done the checking to see if the level fours have been
14 increasing.
15 MR. CALLAN: No, they really haven't. That number
16 is a little deceiving. If every resident wrote one
17 violation every six weeks and every region-based inspector
18 wrote on violation every four months -- I did a
19 back-of-the-envelope calculation on this -- you'd get that
20 number.
21 It's not a lot of enforcement activity by the
22 inspection staff. Our problem isn't too much enforcement as
23 managers. Our problem is enough in terms of performance of
24 the staff.
25 MR. COLLINS: Commissioner, I'm not down-playing
37
1 the significance of your statement, but I look at that as a
2 positive challenge, because I believe this process, as it's
3 currently described -- and others could be built to have the
4 same types of attributes -- will force the staff to look at
5 consistency, and it will bring to light areas, perhaps,
6 where we have not had to focus before because they have not
7 had a major impact on follow-up or follow-through regulatory
8 actions.
9 To the extent that enforcement and other PIM
10 entries now become a focal for potential further regulatory
11 actions, that will force discipline and consistency into
12 those processes. I look at that as a positive challenge.
13 Potentially, if that's done, we will not be
14 answering the types of issues that you reference in there.
15 MR. MARTIN: Commissioner, I'd also point out
16 that, although individually, severity four violations may
17 not mean a lot, if you see a pattern of those, it may
18 indicate that there is an underlying problem of management
19 enforcement of expectations and regard for the regulation,
20 and that does necessitate us responding, and so, the PIM,
21 created as we go with inspections, that PIM has to be
22 assessed periodically to see is there a pattern here which
23 is not revealed in any individual inspection but by the
24 whole inspection program, and so, as a person that has to
25 look at the operational data, we look for the patterns of
38
1 these, and enforcement is frequently a very good indicator
2 of a trend that we haven't picked up otherwise.
3 CHAIRMAN JACKSON: Why don't we go on?
4 MR. BORCHARDT: Okay. Slide seven shows the
5 objective, and I believe if we wrote the objective of what
6 we are currently doing today, the objective that's written
7 on this page would be less than we're doing today, largely
8 because of -- what you don't see here is a recognition of
9 superior performers, yet it, at the same time, maintains a
10 focus, I believe, on the poorer performers.
11 The detailed objectives, another one of the things
12 I think the ACRS was looking for and they hadn't seen before
13 in this format, is that the process needed to be able to
14 provide an early warning of declining performance, need to
15 have some checks and balances with other processes -- that's
16 both internal NRC and outside the NRC processes -- had to be
17 timely, effectively communicate the results, and had to
18 assist the agency in allocating resources.
19 CHAIRMAN JACKSON: Would it be fair to say -- I
20 mean, for consistency, I mean would you call, for instance,
21 your first bullet really your goal within this context and
22 the second bullet is -- you know, really kind of summarizing
23 your objectives, as opposed to saying overall objective,
24 detailed objectives, and then you would end up having --
25 your proposed approach is, in fact, your strategy. Is that
39
1 a fair statement?
2 MR. BORCHARDT: Yes.
3 CHAIRMAN JACKSON: And do we have a clear
4 statement on what our safety performance overall goals are
5 in a set of performance indicators for measuring -- you
6 know, this is process, but this has to be married in terms
7 of performance indicators. Have you done some thinking
8 about that?
9 MR. MARTIN: Chairman, we have, and right now,
10 we're not ready to draw a bright line that says, you know,
11 above a certain number, this is unacceptable performance. I
12 don't know that we're that smart yet.
13 CHAIRMAN JACKSON: Okay.
14 MR. MARTIN: But we are certainly looking for
15 that, and we recognize that one of the complaints we have
16 from the industry is there's not a clear articulation of
17 what is expected here other than compliance. They obviously
18 know compliance, we understand compliance, and so, they are
19 concerned that we are criticizing them at a level above
20 compliance.
21 COMMISSIONER DIAZ: In that overall first
22 objective, where you said safety performance of all U.S.
23 nuclear power plants, I think that's a very important
24 difference from the way we used to do things, because we
25 used to just quickly narrow it down.
40
1 One point that I think is important is, even if,
2 in your algorithm, you are not weighting in what I will call
3 a good performance on a specific area, I think it's
4 important that your database keeps that for reference,
5 because in the case that something comes up in that area,
6 you then already have the information in the same process,
7 you don't have to look for it.
8 So, it is not a balancing act, because you know, I
9 think you know the direction I'm going, but it is a very
10 important factor.
11 The data comes in and you have it, and I think
12 that's the value of the Plant Issues Matrix that we already
13 have being used to some extent -- I don't think to the rigor
14 that this process would require it to be but that it has
15 that running database of inspection information.
16 COMMISSIONER DIAZ: And you will keep that.
17 MR. BORCHARDT: Yes.
18 COMMISSIONER DIAZ: And we can see it, and the
19 licensee will be able to see it. Good. The stakeholders
20 will be able to see it.
21 MR. BORCHARDT: Everyone.
22 COMMISSIONER DIAZ: Good.
23 CHAIRMAN JACKSON: Go ahead.
24 COMMISSIONER McGAFFIGAN: As I understand it,
25 though, you're not going to put good information in there.
41
1 If an inspector walks around the plant and everything is
2 just perfect, never saw a better plant in their lives, not a
3 question that they're close to a margin anywhere in their
4 operations, their maintenance, zero backlog, everybody got
5 100 on the last plant operator licensing exam, and none of
6 that is going to go into the Plant Issues Matrix. It will
7 be a blank page.
8 There will be no issues, so the lack of issues, I
9 guess, will indicate that it's probably a current 2 -- a
10 current 1 but, in the new system, green, because there won't
11 be anything there.
12 MR. BORCHARDT: The difference is it would still
13 be in the inspection report, I think, documentation of what
14 the inspectors did, what they looked at.
15 The finding would be that there were no findings,
16 that everything was acceptable, no problems with performance
17 identified, and so, therefore the group has suggested that
18 the absence of negative findings indicates acceptable
19 performance.
20 But that does not mean that -- very seldom would
21 you see that situation, where everything's fine and perfect
22 at the plant.
23 COMMISSIONER McGAFFIGAN: I'm sure that's true.
24 MR. BORCHARDT: The inspector, just as the
25 inspector has to today, has to balance positive findings
42
1 versus weaknesses identified and, in coming to the
2 conclusions and assessments about overall performance within
3 a given area for that inspection, has to do that evaluation,
4 and that would still continue.
5 So, I would think, in the inspection report, there
6 would have to be a basis provided for how that judgement was
7 made.
8 What we're saying -- what won't be done, however,
9 thought, is that what now populates inspection reports are
10 some positive findings. We would not spend the time to try
11 to grade those positive findings and to counterbalance
12 within the IRAP process the negative findings with the
13 positives.
14 COMMISSIONER DIAZ: But you will still have them.
15 They will still say, in the example that I discussed with
16 Mr. Callan the other day, if you have a plant that has a
17 10-year history of superior steam generator inspections and
18 tracking and water chemistry, you know, and is there, and
19 all of the sudden, there is a problem with the steam
20 generator, you have additional data that would say this
21 issue has been tracking good and all of the sudden there is
22 an issue which is different, but you will still have the
23 fact that it was assessed superior. There will be someplace
24 in the database to include that, but you will not making
25 judgements on it.
43
1 MR. BORCHARDT: There would be a record that an
2 inspection was done in that area, that there were no
3 negative findings. I'm not in a position to be able to say
4 to what extent acceptable performance would be documented.
5 I don't think we have figured that out yet.
6 But you would know how many inspections were done,
7 and if there weren't any problems identified, what we're
8 saying is that means that they were acceptable, and then the
9 first time you get a problem, you know this is the first
10 time out of five times looking in this area that we have
11 identified a problem.
12 MR. CALLAN: I'd like to make two quick points on
13 this.
14 I think it's important to keep in mind that the
15 inspection guidance that we have out to all of our
16 inspectors says that we have an absolute obligation to
17 provide proper context for all of our findings but not
18 balance. We're not obligated to provide balance.
19 What we're obligated to do is to make sure all of
20 our findings are presented in the right context. So, to use
21 Commissioner McGaffigan's example, if a plant is otherwise
22 flawless and find the singularity, the one example of
23 whatever it is, the missing hanger, the missing signature,
24 whatever, the PIM entry should reflect that context, and if
25 it doesn't, then that's poor regulation, it's poor
44
1 inspection.
2 The second point is -- and this is probably the
3 most important and was the pivotal issue in swaying my view
4 on this subject. As the staff knows, I probably resisted
5 this issue more than any in the early stages of my personal
6 odyssey here.
7 If you look at, historically, what we're most
8 vulnerable to, I think it's to rationalizing low-level
9 degradating performance -- in other words, the chronic poor
10 performer, not the acute poor performer. I think we rally
11 around -- we quickly reach a consensus when we recognize an
12 acute safety issue. That's not our assessment problem.
13 Our assessment challenge is a plant that has
14 declining performance in a chronic way over a long period of
15 time, and if you analyze that vulnerability, you find that
16 we're often guilty of rationalizing that poor performance
17 because of noted good attributes, you know.
18 We will note positive management attitude, we'll
19 note new programs, and those positive attributes mask the
20 reality, the facts, and so, the question is, where do you
21 want to inject the positive insights? Do you want to inject
22 them at the beginning, or do you want to withhold that and
23 use those positive attributes as an override factor at the
24 regional administrator level or at the Senior Management
25 Meeting level, and you do that with caution and you do it in
45
1 a deliberate way and you have to have a compelling argument
2 to say -- if the IRAP process gives you an answer you don't
3 like and you think you know better, you think that it's a
4 misleading answer, it doesn't reflect reality, then the
5 burden of proof is on the senior managers to provide the
6 compelling arguments why the plant shouldn't be red, to use
7 that example, why it's green, and that's where you can bring
8 to bear all that positive -- but you have to do that very
9 cautiously, because that is a vulnerability in our process,
10 our current process, that still exists.
11 COMMISSIONER McGAFFIGAN: I'm not sure that you
12 correct a vulnerability without creating a new one. As I
13 say, if everything is two -- let's say two is green -- I
14 interpret two -- two today is a good performer who's meeting
15 regulatory requirements, meets regulatory requirements gets
16 you a green. There's an absence of findings.
17 The ones are going to meet this easily, hopefully,
18 today, unless our ones -- our process for identify ones is
19 messed up. So, all the ones are going to be green and a lot
20 of the twos are going to be green, and you're not going to
21 be able to distinguish between the twos and the ones the way
22 you do today, and resources may be mis-applied.
23 I don't know. You're solving one problem and
24 perhaps creating another.
25 CHAIRMAN JACKSON: Well, it strikes me that, if
46
1 one is planning the work and deciding what the core
2 inspection program is, then that's something that exists,
3 that you decide that, as a regulatory agency, you have to
4 do.
5 It's like saying, well, this guy hasn't crashed
6 any planes yet, you know, recently, so I'm not going to
7 inspect him, and I don't think any of us are going to say
8 that that's where, as a regulatory agency, you would go, but
9 it does say what is your core inspection program relative to
10 where the risk is, and then you can add to or take away from
11 that, depending upon what you find.
12 And so, I think an important issue within this is
13 tying it to what the objectives of the inspection program
14 are and how does meeting those objectives, you know, drive
15 what the fundamental inspection program is.
16 I mean I've asked that question before in terms
17 of, you know, why do we inspect and what should be
18 inspected, and what is the base-line program that we as a
19 regulatory agency should have, and once you get there, then
20 you can talk about, you know, what goes up from there, but
21 if that's the base-line program for adequate protection,
22 then that's what you do, and you can argue that there will
23 be others who get escalated activities or looks, but the
24 question is what is the base-line program, because otherwise
25 you're saying that inspection goes away because a person
47
1 hasn't had a problem or a licensee has not had a problem in
2 five years that you don't inspect them anymore?
3 COMMISSIONER McGAFFIGAN: No, I don't think that's
4 the straw-man being put up. We have residents at every one
5 of these sites. I don't think there is a base-line program
6 where everybody on a certain day inspects a certain thing.
7 There are 70 sites or so.
8 CHAIRMAN JACKSON: No, but they get guidance in
9 terms of what the core things are that they should --
10 COMMISSIONER McGAFFIGAN: It's executed
11 differently.
12 CHAIRMAN JACKSON: Of course it's executed
13 differently, but there still is base-line guidance as to
14 what they ought to be doing. Sure, there are 104 reactors,
15 and each one is different. That's part of the problem we
16 have.
17 But nonetheless, there is a base-line -- what is
18 it that you should take a look-see at, and it is going to
19 get tailored to that specific site to a certain extent,
20 because the site is unique, but you still should be able to
21 define what is a fundamental level at which you have to
22 look, and that's going to get re-normalized according to (a)
23 the specifics of the plant, (b) what you find. But it has
24 to be predicated on knowing what is the fundamental program
25 and risk-informing it appropriately.
48
1 COMMISSIONER DIAZ: I heard Mr. Collins say that
2 something that is very important and which might not be
3 obvious in the diagrams, and those were -- I call the
4 decision-making nodes in which, at regional level, somebody
5 will be able to establish what is the actual weight of the
6 findings relative to something else, and I think that is --
7 as the process is developed and grows, that has to become
8 very evident.
9 CHAIRMAN JACKSON: I think that's a good point,
10 and that's what I keep saying, that to the extent that
11 everybody focuses just on PIM entries, then they're missing
12 the point. It is an integrated process, and you guys ought
13 to make that more clear in your presentation, and maybe
14 that's what's missing, because if people understand, then
15 they understand more how the process works, but maybe it's
16 our fault because we haven't let you go through your
17 view-graphs. So, why don't you proceed?
18 MR. BORCHARDT: The last point I'd like to make on
19 slide eight is the second bullet, and that is the task group
20 felt that the tools that currently are provided by the
21 regulations are, in fact, sufficient for us to do our job
22 and that the tools such as the watch list and the trending
23 letter are not needed and, in fact, have generated
24 unintended consequences that we think this new process can
25 avoid.
49
1 MR. BURNS: I would add that, on that list, the
2 second bullet, it's missing, one, notices of violation,
3 which are really the first level of enforcement action,
4 formal enforcement actions. It should be added there.
5 CHAIRMAN JACKSON: Actually, I said it's
6 interesting that the tools do not include enforcement
7 actions, but okay.
8 MR. BORCHARDT: Slide nine, please.
9 This slide tries to show an integrated one-line
10 diagram of the group's proposal.
11 The next three slides break down this one line
12 into the three major components of inspection, periodic
13 assessment, and action decisions.
14 CHAIRMAN JACKSON: Let me ask you a quick
15 question, because it comes back, in a certain sense, to what
16 we have been discussing.
17 What is the primary tool for ensuring consistency
18 across the regions?
19 MR. BORCHARDT: It's really two things, I think,
20 in my mind.
21 One is the quantification of the matrix that is on
22 slide 13 allows an easy comparison of inspection findings
23 across the country.
24 The other is the results of the annual review that
25 is done -- says routine roll-up, annual regional review
50
1 meeting --
2 CHAIRMAN JACKSON: But that's at the regional
3 level.
4 MR. BORCHARDT: Well, it's really an agency
5 meeting. I really don't like the name. I'm going to change
6 the name of that.
7 MR. CALLAN: Your question is how did we achieve
8 -- identify and achieve?
9 CHAIRMAN JACKSON: Right.
10 MR. CALLAN: With the new process.
11 CHAIRMAN JACKSON: Right.
12 MR. CALLAN: My concern, quite frankly, Chairman,
13 is the new process will only too quickly identify and make
14 public all of our flaws.
15 CHAIRMAN JACKSON: I understand that.
16 MR. CALLAN: It will quickly highlight any lack of
17 consistency amongst -- not only amongst the inter-region but
18 intra-regional inconsistencies.
19 CHAIRMAN JACKSON: I understand it will highlight
20 it, but how do we go on the search to look at it?
21 MR. CALLAN: Well, first we have to identify it,
22 and for example, in the last several months, as you know,
23 we've identified a fair amount of inconsistency with
24 non-escalated enforcement, and our FY '99 budget cycle
25 provides resources to attack that inconsistency.
51
1 We have to identify the inconsistencies, hold
2 people accountable, and then we can deal with it, and this
3 process does that. It will hold us accountable, unlike
4 anything that we've ever had before.
5 MR. COLLINS: There will be various ways, some
6 currently institutionalized, some to be developed, with this
7 process.
8 An example would be it would be very easy to do a
9 search, as we currently have the capability, of plants that
10 have an equal amount of inspection hours at the end of
11 quarters or fiscal years.
12 We could then look to see if those are a similar
13 technology, similar vintage, and we could look at how the
14 PIM totals up to see if the issues that are being found at
15 those sites, for the equal amount of hours, for an equal
16 amount of technology, are similar or not similar.
17 Based on that, is the region adjusting their
18 inspection program and are we, therefore, consistent at a
19 much finer level of detail than we can do now.
20 CHAIRMAN JACKSON: And I guess I'm just asking
21 where in the process and who is going to make that --
22 MR. BORCHARDT: Two places.
23 The Annual Regional Review Meeting is held in the
24 region, therefore its name, but it is very similar to
25 today's screening meeting in that it has participation from
52
1 NRR, AEOD, OI, Office of Enforcement. So, all of those
2 offices -- and I'm sure I left some out -- will participate
3 in that annual meeting.
4 The results of that meeting will go to the Agency
5 Action Meeting, which is the senior managers, and so, they
6 will provide a program overview of the results of every
7 reactor in the country to be able to do an assessment of
8 whether or not a given plant is inappropriately positioned
9 or we see a difference in implementation from one region to
10 the next.
11 COMMISSIONER McGAFFIGAN: As I understand the
12 Plant Issues Matrix -- correct me -- how many are there
13 potentially in it? Maybe I'm thinking of the assessment
14 framework that it rolls into, but there's like 24 entries or
15 16 that you're going to roll into red, green, yellow?
16 MR. BORCHARDT: Well, the Plant Issues Matrix is
17 really nothing more than a --
18 COMMISSIONER McGAFFIGAN: -- a list of the issues.
19 MR. BORCHARDT: Right.
20 COMMISSIONER McGAFFIGAN: But then when you try to
21 roll it into the integrated assessment, where do things get
22 scored? Is that an ongoing thing that anybody in the public
23 can see --
24 MR. BORCHARDT: Yes.
25 COMMISSIONER McGAFFIGAN: -- the plant at the
53
1 moment, in the 16 categories, is green in 15 and red in 1?
2 That will be an ongoing thing?
3 MR. BORCHARDT: The individual inspection issues
4 would be graded with the issuance of each inspection report,
5 be provided with the inspection report, so that the public
6 and the licensee could see what the staff's assessment was
7 and the grade.
8 COMMISSIONER McGAFFIGAN: Will it also be
9 transparent as to how that rolls into this assessment
10 matrix?
11 MR. BORCHARDT: We would designate what we thought
12 was the functional area on slide 13 now, whether the issue
13 belonged under material condition and it was caused by a
14 human performance problem, so you know, you'd go down and
15 over, and that's the block that it would be in.
16 COMMISSIONER McGAFFIGAN: I'm trying to get a
17 point here.
18 So, in real time, people will know that the NRC is
19 currently grading each of 70 sites or so these folks, and
20 so, inconsistencies may start -- people will do things like
21 assign green 1 and yellow 2 and red 3 and they'll say that
22 this is a 1.275 plant or a 2.395 plant, and that all will be
23 going on, and in real time, as I understand it, under this
24 proposal --
25 MR. COLLINS: I anticipate there will be a whole
54
1 new cottage industry out there for entrepreneurs to --
2 COMMISSIONER McGAFFIGAN: Yes.
3 MR. COLLINS: -- provide that type of information.
4 COMMISSIONER McGAFFIGAN: I may have left the
5 Commission by then and that will be my first role in life.
6 CHAIRMAN JACKSON: Oh, you're going to set up your
7 business? You better be careful.
8 COMMISSIONER McGAFFIGAN: My business will be
9 telling the world what we are, what the 104 plants are at
10 any one time.
11 But how do you then get consistency? I'm leading
12 up to -- one of the values or wonderful things about this is
13 that people are going to know exactly they're at 1.25 -- no,
14 they got a new inspection finding, they went up to 1.23,
15 they went down to 1.29, and you have 70 different processes
16 going on for 70 different sites, with potential
17 inconsistencies that we've just been talking about, not just
18 trying to have consistencies among four regions but among
19 70, and how is that all going to work?
20 MR. BORCHARDT: Well, my answer to that is that,
21 in the annual regional review activity, we're going to be
22 taking other sources of information such as the work that
23 AEOD is doing with performance indicators, with the trend
24 methodology, with the risk program that Mr. Martin referred
25 to that the Office of Research is working on.
55
1 All of those elements come together at that
2 meeting, and we see whether or not -- I don't know if
3 consistency is the right word at this point or if it's
4 accuracy, but is the inspection program, which is populating
5 the Plant Issues Matrix and populating that matrix, giving
6 us an answer that is consistent with all these other
7 independent data sources?
8 If not, we have to ask ourselves, was it a
9 shortcoming with the inspection program, did we not look in
10 the right areas, did we have incorrect findings, or you
11 know, maybe those other programs are missing something that
12 the inspection program saw.
13 But it at least forces us to --
14 COMMISSIONER McGAFFIGAN: But which number is
15 public? Is it that chart on page 13 that's public for every
16 item, or is it something that happens at the annual regional
17 meeting, where we say, well, they aren't really a 1.25
18 because of -- their performance indicators are quite low and
19 they've had other problems lately, and so, we're going to
20 re-normalize now and say, instead of 1.25, former
21 Commissioner McGaffigan, you've got it wrong, it's 1.75,
22 we're knocking them down 5/10ths of a point because of
23 judgement, and then how is that built in? I mean how is
24 that made scrutable?
25 MR. BORCHARDT: In my view, chart 13 would be
56
1 public throughout the year. It would be built -- the
2 database would be accumulated and be built.
3 At the annual meeting is where a judgement would
4 have to be made. The summing of those inspection findings
5 would lead us through exercising the decision logic to a
6 certain conclusion, but we didn't want to rely on that.
7 So, we're using many of these other data sources
8 to force us to compare those inspection findings and what
9 that would have told us to do against these other
10 independent sources, and that is where management has to
11 make a decision, if there is a difference, how do we
12 interpret that and what is going to be the agency action?
13 We wouldn't change the numbers in chart 13. Those
14 are what they are. They have been established by the
15 inspection program.
16 What the eventual actions are for that licensee is
17 it may be heavily influenced by what the senior managers
18 view as the integrated analysis of all these independent
19 sources, as well as the inspection program.
20 COMMISSIONER McGAFFIGAN: But are all those other
21 data going to be made public, as well, so that if the
22 integrated assessment process isn't leading -- and this
23 matrix isn't leading to what the -- our best judgement of
24 the score is, how are all these other items that may lead
25 you to a different assessment going to be put in?
57
1 I mean, at the moment, the Senior Management
2 Meeting book, which has stuff like that, is labeled
3 pre-decisional and we don't put it out. Would we be putting
4 out the Senior Management Meeting or the regional book in
5 its entirety so that people could see the other data that
6 we're taking into account?
7 MR. BORCHARDT: We haven't discussed that in
8 detail, but my personal view is that, to be consistent with
9 everything else we're trying to do, that all those data
10 sources would have to be --
11 MR. CALLAN: Anytime the results of the algorithm
12 or the binning is overridden by other insights, then those
13 insights and that rationale has to be entirely scrutable,
14 because otherwise we're right back into the same
15 vulnerability we had before, you know, which is what we're
16 trying to fix.
17 The other point -- you were talking about
18 consistency. Let's talk about fairness for a minute.
19 Fairness -- at least the reality and the perception of
20 fairness is very important in the regulatory process.
21 This process does inject, in my view -- and I
22 don't know whether the industry would agree with this -- a
23 degree of fairness that our current process doesn't have,
24 because at each six-week roll-up period, the licensee is
25 presented the information, they have to come out of the
58
1 closet.
2 They have to provide some creative tension, and
3 right now, many licensees don't. They're very passive.
4 COMMISSIONER DIAZ: Or we come out of the closet.
5 MR. CALLAN: We come out of the closet.
6 But we basically beg the question -- do you agree
7 with these results, and if not, why not?
8 CHAIRMAN JACKSON: Talk slowly. Let me ask you
9 two quick questions.
10 Do you anticipate that corrective actions have to
11 await the results of your annual meetings?
12 MR. BORCHARDT: Corrective actions of the
13 licensees? Absolutely not. This is completely in parallel
14 with our day-to-day responsibilities.
15 MR. COLLINS: This does not negate the normal
16 process which currently exists in the regions for the
17 regions to take actions that they deem appropriate.
18 CHAIRMAN JACKSON: This doesn't override that.
19 This is assessment.
20 MR. COLLINS: Yes.
21 CHAIRMAN JACKSON: Secondly, where does the trend
22 methodology and the regression models enter the process
23 again?
24 MR. BORCHARDT: On chart 9 -- formerly, they would
25 enter in at the Annual Regional Review Meeting.
59
1 CHAIRMAN JACKSON: Okay. I shall return.
2 MR. BORCHARDT: Slide 10 takes a portion of that
3 one-line diagram that focuses largely on the inspection
4 process.
5 The process starts with inspection findings and
6 the assignment of significant values. The PIM issues, as we
7 already discussed, are assigned significant grades and are
8 issued with each inspection report.
9 The Plant Issues Matrix then becomes the first
10 opportunity for -- to gather licensee feedback on the issue
11 significant values that have been assigned.
12 At this point, the items are scored, and all of
13 this data collection is through the inspection program at
14 this stage.
15 On slide 11, this is the assessment process
16 portion, and although the assessment is done continuously by
17 both the NRC staff and the licensee and the public, because
18 all the inspection information is public, at least annually
19 the agency will perform an integrated review, and although
20 the meeting is called the Annual Regional Review Meeting,
21 because it's located in the region, it's really an agency
22 meeting, with participation from a wide range of offices.
23 It analogous to today's plant performance review and
24 screening meetings combined into a single meeting.
25 We would expect the meeting to occur over probably
60
1 a series of days in one region so that all plants within a
2 region would be done within a couple days.
3 COMMISSIONER McGAFFIGAN: Would this be public?
4 MR. BORCHARDT: No.
5 COMMISSIONER McGAFFIGAN: Why not? Is there any
6 public meeting -- I mean, at least in the current Senior
7 Management Meeting process, at some point you guys come to
8 the Commission and have a public meeting. I don't see that
9 in here.
10 MR. BORCHARDT: That's on the next slide.
11 MR. COLLINS: I think that's a very good question
12 we have to work our way through. I'm not sure that we have
13 even thought about addressing it.
14 Some of the issues which Steve Burns may know
15 better than I would be whether it's considered
16 pre-decisional to an agency action.
17 In other words, if we were to decide, based on
18 that meeting, that we might go down the path of a regulatory
19 action, whether it be a 50.54(f) letter or an order, we
20 might be discussing instances, potentially, of allegations,
21 allegation trending specifics, harassment-intimidation.
22 I think, in an idea sense, the types of issues we
23 are talking about should be readily publicly available. It
24 would be more of a decision-making process if it would be
25 termed pre-decisional that I think we have to be careful on.
61
1 But certainly we have to look at that. I just think we
2 haven't perhaps considered it.
3 MR. BORCHARDT: The first bullet under assessment
4 there, "Licensees can provide self-assessments," that would
5 be a public meeting at which the licensee has the
6 opportunity to provide their own self-assessment of
7 performance to the staff as it prepares for this annual
8 meeting. That would be public.
9 But we did not envision -- but to be honest with
10 you, we didn't even really consider whether or not the
11 actual regional review meeting would be --
12 COMMISSIONER McGAFFIGAN: I'm just going back to a
13 comment that Mr. Lochbaum, I think, of UCS, at one point
14 made about the process, and that was that you should discuss
15 all the plants before the Commission, presumably over an
16 extended period, and tell us about each one, and that was
17 something he wanted to see in this result.
18 That, I don't think, is what this agency action
19 meeting at the end intended to do. You're not going to
20 discuss with the full Commission every plant under this
21 proposal, as I understand it.
22 So, to the extent the public is going to
23 understand something scrutable about why the region judges
24 the plants the way they judge them and has, like the SALP
25 process today, a chance to at least witness what's going on,
62
1 it looks like this regional meeting may be it.
2 MR. BORCHARDT: Okay. There's a couple of points
3 to make here.
4 As we have now a SALP management meeting following
5 issuance of the SALP, there's a public meeting with the
6 licensee, there would still be an annual meeting between the
7 region -- between the NRC staff and the licensee held at the
8 licensee's facility, public meeting, to discuss the results
9 of the annual assessment. So, that would still take place.
10 COMMISSIONER DIAZ: At which time the licensee
11 can, you know, say I don't agree with you.
12 MR. BORCHARDT: Absolutely, yes.
13 MR. CALLAN: And they'll have multiple times
14 during the year, also.
15 COMMISSIONER DIAZ: Sure. But in a public forum,
16 they will have an opportunity to say this is not right or
17 this is right.
18 MR. COLLINS: Some of these discussions at the
19 deliberative processes, even SALP internal assessment
20 meetings, there are a number of views that are proposed by
21 the staff at those meetings. Ultimately, the process
22 prevails and they're sorted through using the process.
23 I would not want to inhibit that deliberative
24 process of the staff, knowing that it comes to a conclusion
25 which then has to be substantiated in its final form in a
63
1 public meeting.
2 I would not want to detract from that
3 give-and-take and openness of that process within the NRC
4 staff. That would be a concern.
5 MR. BORCHARDT: On slide 11, the research risk
6 activity trying to take a look at a year's worth of
7 inspection and other information and coming up with the risk
8 insights on an integrated type of format -- that would be
9 done as part or in support of this annual regional review
10 meeting.
11 MR. COLLINS: A point to make -- and it's not an
12 impediment currently, but it is a major consideration -- and
13 that is that our current inspection program does not match
14 annual cycles. Our current inspection program matches SALP
15 cycles, which are 12 to 18 to 24 months, the average being
16 approximately 18.
17 If we were to go to an annual cycle, there would
18 be a fairly significant adjustment to the inspection
19 program. The considerations would be do we take 18 months
20 of inspection and move it down to 12? I think the answer to
21 that is probably no.
22 So, it would take a look at that program to
23 determine, fundamentally, which is the second phase of our
24 committed review on regulatory excellence, to understand how
25 much inspection is enough and what type of inspection is
64
1 appropriate to support these 12-month cycles.
2 MR. CALLAN: We have that problem in a massive way
3 today, because we have this 18-month inspection cycle and
4 we're doing assessments every six months, and so, the first
5 six months in an 18-month cycle is pretty sparse.
6 So, this is not a new problem. We just hope to
7 lick the problem that's been with us for a decade.
8 COMMISSIONER DICUS: I think I'd go back to
9 Commissioner McGaffigan's question earlier regarding
10 resources. I see a possibility of this becoming even more
11 resource-intensive. You're saying because you're only going
12 to do this every year --
13 MR. BORCHARDT: There's a slide later in the
14 package which tries to show that there's far fewer meetings.
15 MR. CALLAN: Let's look at slide 16 just briefly.
16 COMMISSIONER McGAFFIGAN: There are fewer
17 meetings, but the point about my ones versus twos -- the
18 average plant today out there is about at 1.5, right?
19 You've got a couple of ones and a couple twos or they've got
20 three ones and a three, and if you guys now -- and the ones,
21 as you say, have consequences at the moment, and if those --
22 less inspection.
23 If you now homogenize on two, you're going to have
24 to find the resources to, as Sam says, get everything done
25 right, unless in the transition from the current system to
65
1 the new system, you say, well, they are ones at the moment
2 and so we won't go quite as rapidly to fill every box in the
3 matrix for the ones from the old system as the new system
4 would require.
5 COMMISSIONER DIAZ: But I think that the issue --
6 I'm not sure I'm right -- is that it is information
7 processing-intensive, not necessarily more
8 resource-intensive.
9 In other words, there is more manipulation of
10 data, accumulation, and tracking, but because of the
11 informatics that we have available, that doesn't make it
12 more resource-intensive.
13 MR. CALLAN: Let me say one thing about inspection
14 resources, because this may not be apparent, but the average
15 site, homogenized, averaged over 104 sites, is about 2,700
16 hours per year today, and it may go down to 2,500 in FY
17 2000, depending on how you all deal with the budget
18 proposal, but 2,700 hours.
19 The station between a SALP-1 inspection regime and
20 a SALP-2 inspection regime is a few hundred hours, you know,
21 500 hours perhaps in an extreme.
22 Where the big delta occurs is that handful of
23 bottom-rung plants that get four, five, six, seven, eight,
24 ten thousand hours. As you know, Region III has about a
25 half-dozen sites that are getting 8,000 hours plus, you
66
1 know. So, that dominates the inspection resource issue,
2 completely dominates it.
3 So, any distinction between a good performer or a
4 superior performer and a not so superior performer is
5 completely dominated by how we do the bottom end of the
6 spectrum, and to the extent that we're smarter and more
7 accurate in identifying those bottom-rung performers, we
8 have the potential to realize tremendous resource savings
9 and not just sink inspection resources, you know,
10 inappropriately into a site that doesn't deserve them.
11 COMMISSIONER DICUS: Isn't that what we're doing
12 now? I really can't see how the new process prevents that
13 or saves those resources.
14 The new process, if we go to it after it's fleshed
15 out, simply says we're going to identify plants that need
16 additional attention.
17 Then we've got many more plants that -- I'm not
18 quite sure what we're going to do with them, and it seems to
19 me we set up a potential, if we concentrate resources on the
20 plants that we think need those resources, taking them away
21 from plants that are mediocre or whatever we're going to
22 call the not-getting-attention plants, how can we tell that
23 one of those plants will not begin to decline in
24 performance?
25 Even though we have the resident inspectors there,
67
1 how are going to catch that, and how is that different from
2 what we are doing today? Maybe we've been talking around
3 it, but I haven't seen it.
4 COMMISSIONER DIAZ: Well, I think that's precisely
5 what this process is trying to address. It is supposed to
6 address that.
7 MR. BORCHARDT: The way, I think, that makes it
8 easier -- it goes back to -- largely to the quantification
9 of individual inspection issues, which allows you, on slide
10 13, to place each issue into the appropriate box, and you
11 can add them up.
12 In the area of operating performance, you just
13 take all the issues that are in any of those four blocks
14 under operating performance, and you can add them and come
15 to a comparative judgement about how well that licensee is
16 performing.
17 That will lead you to, I think, in a more direct
18 way than we do today, being able to assign inspection
19 resources at an appropriate level.
20 If you found that there were a large number of
21 issues that had significance in the human performance and
22 operating performance block, that would allow you to
23 pin-point where you needed to perhaps do additional
24 inspection, and that process, that ability doesn't exist
25 today, because all we have is a listing of inspection issues
68
1 with -- we have to rely upon the managers to integrate
2 within their own heads the significance of those issues and
3 to integrate that in order to come to that resource
4 allocation judgement.
5 MR. MARTIN: The appeal of this new process -- and
6 having been involved in the previous process, where we had a
7 PPR and we had a SALP and we had a Senior Management Meeting
8 -- are a couple-fold.
9 First of all, this process will not have the same
10 redundancy of review and repackaging of the same individual
11 insights for different purposes. To the extent it can, it
12 improves that efficiency and removes as much redundancy in
13 that as you go through the phases. In fact, they actually
14 now feed into each other.
15 The second part is that the process -- and it's
16 not fully articulated, we recognize that. We still need to
17 do some more work, but the process will be far more
18 scrutable. They'll see how we have said we're going to get
19 from this point to this point, we're going to give the
20 public access here, they're going to see it, there's going
21 to be QC by the licensee here, and they can see products out
22 of the various parts, and where we make decisions that
23 aren't obvious from the input into those processes, we have
24 an obligation to articulate why we did something different
25 or why we came to a different conclusion.
69
1 I think, in a lot of ways, though, the rest of the
2 process is going to be pretty much the same in terms of
3 resource commitments. Problem plants are still going to
4 have to dealt with. Plants that are doing well -- we'll
5 adjust the inspection resources for those.
6 We'll still have to do quality inspections. We'll
7 have to make changes to the inspection program as we see
8 ways to improve its risk insights.
9 So that the main things I think this new process
10 gives us is removes a lot of redundancy and, to be quite
11 frank, frustration in the regions that they keep having to
12 repackage this same information, and then the better
13 scrutability. That's the issue.
14 COMMISSIONER McGAFFIGAN: I agree that we should
15 not have to repackage the same information and that there
16 are ways to work with the current system, but just on the
17 point of this matrix on page 13, you could get misled by it
18 easily in that you may have a lot of hits in some box and it
19 may only represent that that's where your inspection
20 resources went the last year, and indeed, instead of looking
21 in that box where you have maybe some yellows and reds, the
22 problem is in one of the boxes you didn't inspect.
23 Also, I worry about the poor plants that are the
24 lucky winners of the fire protection functional inspection
25 or the AE inspection or the big -- you know, we get findings
70
1 in those, and that could skew -- because they happen to be
2 the one that got one of these heavy-duty inspections that
3 year, they're going to get a lot of reds and yellows in
4 their box, and another plant that -- the vast majority of
5 plants that avoid it, having those inspections, because they
6 are so resource-intensive on us, they come out looking good
7 in comparison when they, in fact, aren't.
8 So, how do you normalize for the lucky winners of
9 our heavy-duty inspections that are oftentimes random?
10 MR. BORCHARDT: We didn't intend to remove the
11 requirement to have to use a value judgement. This isn't
12 purely mechanical or purely quantitative. We are using some
13 quantitative tools to help us do our job, but it's not going
14 to replace the management judgement of whether or not more
15 resources need to be applied to a certain reactor, for
16 example.
17 MR. COLLINS: I'd like to answer your question
18 more directly.
19 We can't un-know what we know. If we go to a
20 plant and if that plant is selected appropriately for --
21 whether it be an architect engineer inspection or a fire
22 protection inspection -- it's done for a purpose. If it's a
23 trial program, it's to define the state of the industry, so
24 to speak.
25 If that plant represents a significant amount of
71
1 findings, if that's representative of the pilot plants, then
2 more typical than not that will become an overall initiative
3 that other plants will be affected by.
4 The staff cannot be in the position of discounting
5 those issues if they, in fact, are safety or regulatory
6 significant.
7 What we should be able to consider -- are the more
8 typical lower-level findings representative of a large
9 problem or are they just there because we happened to look
10 in a more focused way and we found low-level issues and,
11 therefore, they're not indicative of the overall program?
12 We need to be able to make that judgement call which Bill
13 was mentioning.
14 The look at the matrix which you indicated, which
15 was really a hindsight look, which is, after the year, when
16 we look at the matrix, we only know what we looked at, we
17 don't know what we do not look at.
18 This process, once invoked -- and it's similar to
19 the current process -- is that those are, quote, smart
20 samples, hopefully. The previous findings as well as the
21 base-line program will send you into directions for
22 application of the program. That process is meant to do
23 that.
24 We inspect in areas for a reason, if the process
25 is working correctly. Therefore, the results should
72
1 indicate where we thought we needed to look.
2 The fact that there are gaps in that is indicative
3 of the previous question, which is a fair question, and that
4 is how much do you need to look to establish a base-line
5 program? That should be a minimum amount of inspection.
6 If we're going to raise that threshold up and say
7 not only do we have to have a minimum amount of inspection
8 to identify regulatory problems but also a minimum amount of
9 inspection to recognize good performance, that's an extra
10 amount of inspection, but it also affords us the attribute
11 of being able to recognize declining performance sooner,
12 because you have a higher tier or a higher bench-mark.
13 That's a fair policy question to ask -- what is
14 the intent of this process and what's the best position,
15 balancing resources, for the staff to be in?
16 COMMISSIONER DICUS: If I recall from earlier in
17 the briefing, I think you said that this chart, irregardless
18 of what the dominant color could wind up on it, red or
19 green, could go away because of other inputs into the
20 process.
21 MR. CALLAN: Yes.
22 MR. MARTIN: Can I jump in?
23 COMMISSIONER DICUS: Yes.
24 MR. MARTIN: This is a concept paper. We
25 recognize, if the Commission agrees that this is the right
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1 way to go, we've got a lot of work to develop the details to
2 provide these promises that we're delivering to you in terms
3 of scrutability and consistency and uniformity. To be quite
4 frank, among the staff, there are difference of opinions on
5 how those details are going to go.
6 I think you probably would acknowledge, though,
7 that this concept certainly has substantial opportunities
8 for improvement in our efficiency, in our effectiveness, and
9 in our scrutability, but to deliver that, we've got to do a
10 lot of work in laying out the formality of the process so
11 that everyone understands what's expected, and we have to
12 train our staff, too, and then we have to have the oversight
13 and the feedback processes to keep it going that way.
14 So, it's easy to tear us apart on the details,
15 because we haven't really, to be quite frank, agreed on all
16 of those details, and I see this right now as a concept
17 paper.
18 COMMISSIONER DICUS: Let me address that, because
19 earlier on, I thought -- we keep calling this a work in
20 progress, and we talk about -- my definition of work in
21 progress, I think of something that's fairly -- reasonably
22 mature, has moved along to a certain status. I'm not sure
23 this is to that point yet. I'm more comfortable calling it
24 an idea in progress.
25 MR. CALLAN: It's a concept.
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1 COMMISSIONER DICUS: And we get into that point,
2 then -- I think what we're doing -- and I'm not -- I don't
3 know -- I probably haven't reached a position on this. I'm
4 probably pretty much a clean slate, pretty neutral on what
5 to do.
6 I do want to change the process we're using to
7 look at our plants. I think we all do. We've all agreed
8 that there are improvements that can be made, that can make
9 it better, make it more transparent, make it clearer what
10 we're doing to everyone, and hopefully make us not miss
11 issues that we shouldn't be missing. So, I think we're all
12 on board to do that.
13 I think we've got an idea, a concept out here on
14 the table. I think what you're hearing is not -- I wouldn't
15 take it as being negative. You've put a lot of work into
16 it, and I, for one, appreciate all the work that has gone
17 into it.
18 I think what we're saying -- we're giving you what
19 our thoughts, our concerns are, and these are the things you
20 go back and much on to continue to let this concept grow.
21 So, I don't want, from my perspective, at least,
22 to say this is all bad, all negative, there is nothing here
23 that can be used, because I don't particularly feel that
24 way, but there are some problems.
25 MR. BORCHARDT: That's exactly the kind of input
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1 we need at this point and why we think this is the
2 appropriate time to get some public interaction, to get the
3 same kinds of issues identified that are on the industry and
4 the public's mind relating to this process, so that as we go
5 forward, we can have knowledge of all of those various
6 concerns and then develop something.
7 COMMISSIONER DIAZ: Let me pick up on just a word
8 that Commissioner Dicus said, which I've been trying to
9 really assess.
10 It's the word "transparency," and we cannot
11 assess, presently, what the significant on resources that
12 transparency will have, because we really have not had a
13 transparent process that allows the licensee to make
14 correction before they need to get a call, that allows a
15 licensee to interact, and it's the interactive processes of
16 this concept that are really, you know, potentially of great
17 benefit, and like Commissioner Dicus and McGaffigan said, we
18 are trying to engage in trying to determine how far they go,
19 but it is obvious that transparency would be a major gain
20 that will allow our licensees to see from the beginning --
21 and other stakeholders, what are the processes and the
22 results, and their response to that, the response of the
23 licensees to the issues raised is actually a tremendously
24 significant factor in how they will get weighed at the
25 decision-making process.
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1 MR. CALLAN: I agree. I feel like a caveat here
2 is in place, because at the outset, I said that we asked for
3 this meeting, this was our idea, because if we thought this
4 process would sell itself, we wouldn't need this meeting,
5 and we recognize it's quite controversial, and I think,
6 collectively, we also recognize that the typical thinking
7 person's first impressions of this process are not always
8 positive. Mine weren't.
9 This process, superficially, is not always
10 attractive to everybody. It's surprisingly nuanced, and
11 with my anyway, it was an acquired taste. It's undergone a
12 lot of evolutionary change since I was first introduced to
13 it, but I think it's because of our own personal
14 experiences, we're maybe trying to over-market this to you.
15 So, we don't mean to come across as taking too strong of an
16 advocacy position on this, but I think we're trying to give
17 it our own personal odysseys, as I said, trying to
18 force-feed you in an hour-and-a-half or two hours what took
19 us several weeks.
20 COMMISSIONER McGAFFIGAN: I do think it would have
21 been useful to have not just the radical concept but an
22 incremental concept out there for people to mull on, because
23 I can fix a lot of the problems in the current system -- and
24 you're working on them simultaneously -- with less radical
25 schemes that maybe don't have all of the attributes you have
77
1 here, and maybe that takes a lot of effort -- watch list
2 meetings happening once a year rather than every six months,
3 trying to get the PPR to just be the thing that flows into
4 the regional meetings that lead into the Senior Management
5 Meeting.
6 I've got rid of one process right then, if all the
7 PPR is is something that flows into the annual roll-ups, the
8 regional roll-ups, and that's not very radical, and then you
9 could look at other elements of what you've done here and
10 see how many of those I might want to preserve and how many
11 not, but I think -- either the straw-man of the current
12 process, with all of its duplicity -- duplication, not
13 duplicity -- duplication and whatever -- you can fix some of
14 that, and then it's a choice between incremental change that
15 gets you somewhere and radical change -- and I think you
16 honestly do need to look through at how this is going to be
17 gained, I mean how it's gained -- you're seeing some
18 resource benefits. I'm seeing, potentially, some resource
19 costs.
20 Are the benefits and resources outweighed by the
21 costs? And I know that's -- I think part of the proposal
22 you have before us is that you're going to look at this in
23 an individual place or two. I'm not sure that that will
24 help unless it's one in every region or whatever your
25 concept is, but I'm not sure whether that will help, because
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1 these issues of how things lock together, interrelate, won't
2 be obvious unless you do several trials as to how this would
3 work in practice.
4 MR. COLLINS: Commissioner, I think -- not
5 disagreeing with any of your statements, but I believe for
6 the staff to go down any one of these paths in an alternate
7 path, the staff would need specific guidance from the
8 Commission on which one of the bench-marks that are listed
9 in this approach and in the Commission paper are more
10 dominant. It's a mix and match.
11 By having scrutability, you are forced in a
12 direction. By saving resources, that may or may not be
13 compatible with scrutability.
14 So, perhaps they're all not honorable goals at
15 their costs. This process tends to address the majority of
16 them, if not all of them, sends the staff in a direction of
17 which a consolidation of our current processes perhaps would
18 not reach all of those goals, and I think it's going to be
19 very difficult for the staff to understand which ones of
20 those are predominant in the minds of the Commission.
21 So, some direction will be needed to go down that
22 path fruitfully.
23 MR. BORCHARDT: Just from the perspective of the
24 task group, it wasn't our objective going in to redesign a
25 new process. What we were trying to do is to meet those 74
79
1 line items. The only way we saw to be able to get there was
2 something on the magnitude that we've proposed.
3 To make the 74 individual changes to the current
4 process may well end up with something that's an awfully lot
5 like this.
6 COMMISSIONER DICUS: Do you have a list of those
7 74 line items?
8 MR. BORCHARDT: Yes.
9 COMMISSIONER DICUS: That would be useful.
10 MR. BORCHARDT: I think we've covered most of the
11 content of the rest of the slides. I'll just go through
12 them very quickly.
13 Slide 15 just shows a comparison of the proposed
14 process over the current process, and I think I've made this
15 point before, that we have three current processes that send
16 their own message and there is the opportunity for sending
17 conflicting messages, and we're trying to replace it.
18 MR. CALLAN: And we do acknowledge Commissioner
19 McGaffigan's point that we could force that current process
20 into a more streamlined thing.
21 MR. BORCHARDT: Slide 16 just shows a comparison
22 of, over a three-year period, what meetings are held today
23 and how many and what the proposed set of meetings would
24 likely be, and then 17 shows what is the proposed schedule
25 that's in the Commission paper.
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1 I'd just like to make the point that this schedule
2 includes public workshops that are currently being scheduled
3 for the May-June time-frame, as well as the Regulatory
4 Information Conference two weeks from now has a break-out
5 session on this topic.
6 Those would be influences upon the Commission's
7 decision --
8 MR. CALLAN: We ought to make that a plenary
9 session.
10 MR. BORCHARDT: -- on allowing us to go forward
11 and continue public interaction, but we think this is a
12 particularly valuable time to get that input, so that we can
13 proceed.
14 COMMISSIONER DIAZ: I wrote something down. I
15 really appreciate what you guys have done. You took a risk,
16 you went forward, you did something that was different, and
17 I think that's very worthwhile, and I personally want to
18 thank you for it.
19 I've been looking at this, and I think you make a
20 very valiant effort of getting out of the ordinary into the
21 extraordinary and integrate, you know, and be responsive to
22 the Commission.
23 I believe that what you have done is not only an
24 integration process of the things that were there, but you
25 have integrated them with state-of-the-art information
81
1 technology. You have actually included in there, you know,
2 issues of sampling frequencies, issues of how you make
3 decision-making, and you took into consideration
4 time-dependencies.
5 What I think has happened is that you're trying to
6 make more quantitative and more transparent the processes
7 that were there, but it still, you know, is a parallel
8 process that includes our robust safety philosophy.
9 From my viewpoint, I think it is important that
10 maybe, you know, a question be answered, and that question
11 is the bottom line, okay? Are these processes going to
12 maintain or improve the safety of our processes, and will
13 they entail a reduction of our resources and the resources
14 of the licensees?
15 MR. CALLAN: In my view, you know, the current
16 process is a process for the '80s and '90s. This is a
17 process for the next millennium. I think we would agree
18 that the industry, by every tangible measure, is getting
19 safer.
20 We showed Congress those graphs, and NEI makes
21 those available. On the whole, I think, increasingly, going
22 forward in the next decade, next two decades, the agency
23 will necessarily need to focus and identify that sub-set of
24 plants that aren't performing with the industry.
25 I think the marketplace -- an economically
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1 deregulated marketplace -- the marketplace will demand
2 superior performance the way we traditionally have measured
3 it in terms of keeping the plant on the line, availability,
4 and those sorts of things, and I think we face significant
5 challenges in identifying declining performance in that kind
6 of an environment.
7 I think the need to identify superior performance
8 is going to increasingly invoke the law of decreasing
9 returns, I think, with the industry going the way it is.
10 So, I think, going ahead, maybe not today, necessarily, but
11 certainly, if you're designing a process for the future, as
12 this is, then I think the focus on the bottom-rung
13 performers is increasingly going to be appropriate, and more
14 or less, leave everybody else alone in the sense of the
15 intrusive regulatory involvement beyond that necessary to
16 ensure that we have confidence that we can track their
17 performance.
18 MR. COLLINS: The question was asked earlier and a
19 comment was made, is the agency held accountable for
20 extended plant shutdowns, and I think a fair reading of the
21 GAO report would indicate that, at least in the GAO's
22 opinion, those plants that had extended shutdowns were
23 agency failures. That was in a regulated environment.
24 In a deregulated environment, extended plant
25 shutdowns have a whole new potential impact on licensees, on
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1 economics, and therefore, using that philosophy which has
2 been articulated by an outside agency organization which is
3 viewing our effectiveness, we may very well be held
4 accountable for those types of processes which may end up in
5 failures.
6 COMMISSIONER DIAZ: We are continuously held
7 accountable for safety.
8 MR. COLLINS: For safety. I'm getting to my
9 point. We can't lose sight of what our primary mission is,
10 and that primary mission is to assure safety, which has a
11 much higher threshold, perhaps, for able to be identified
12 with our current systems.
13 To reach into the ability to predict and
14 anticipate declining performance is a whole new level of
15 sophistication and resources that this process will
16 accommodate but not perhaps predict success in those areas.
17 It will allow us to be better, but it may not allow us to be
18 infallible in those areas.
19 So, that, again, of what are we trying to achieve
20 and how do we measure success by any change in our processes
21 has to be defined by what we're trying to accomplish. I
22 think that's a primary Commission role, perhaps, to send
23 that message to the staff, because it will dictate the level
24 of resources, inspection, and how this process is defined.
25 COMMISSIONER DICUS: Okay. Is there anything
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1 else?
2 COMMISSIONER DIAZ: I just was going to say that I
3 think you are acting chairman right now and that we no
4 longer have a quorum.
5 COMMISSIONER DICUS: That's correct. We're not
6 voting, though.
7 COMMISSIONER DIAZ: I am not prepared to address
8 the management performance --
9 COMMISSIONER DICUS: Nor am I.
10 COMMISSIONER DIAZ: -- competency issues at the
11 present time.
12 COMMISSIONER DICUS: You're making a
13 recommendation that --
14 COMMISSIONER DIAZ: I will make a recommendation,
15 Madam Chairman, that we adjourn.
16 COMMISSIONER DICUS: I agree with you. So, this
17 briefing is adjourned.
18 [Whereupon, at 4:44 p.m., the briefing was
19 concluded.]
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