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                                                           1

          1                      UNITED STATES OF AMERICA

          2                    NUCLEAR REGULATORY COMMISSION

          3                       OFFICE OF THE SECRETARY

          4                                 ***

          5             BRIEFING ON CALVERT CLIFFS LICENSE RENEWAL

          6                                 ***

          7                           PUBLIC MEETING

          8                                  Nuclear Regulatory Commission

          9                                  One White Flint North

         10                                  Building 1, Room 1F-16

         11                                  11555 Rockville Pike

         12                                  Rockville, Maryland

         13

         14                                  Friday, March 3, 2000

         15

         16              The Commission met in open session, pursuant to

         17    notice, at 9:31 a.m., the Honorable RICHARD A. MESERVE,

         18    Chairman of the Commission, presiding.

         19

         20    COMMISSIONERS PRESENT:

         21              RICHARD A. MESERVE,  Chairman of the Commission

         22              GRETA J. DICUS, Member of the Commission

         23              NILS J. DIAZ, Member of the Commission

         24              EDWARD McGAFFIGAN, JR., Member of the Commission

         25              JEFFREY S. MERRIFIELD, Member of the Commission

                                                                       2

          1    STAFF AND PRESENTERS SEATED AT THE COMMISSION TABLE:

          2              KAREN D. CYR, General Counsel

          3              ANNETTE L. VIETTI-COOK, Secretary

          4              BRIAN HOLIAN, Deputy Director, Division of

          5                Reactor Safety, Region I

          6              ROY ZIMMERMAN, Deputy Director, NRR

          7              WILLIAM TRAVERS, EDO

          8              CHRISTOPHER GRIMES, Chief, License Renewal and

          9                Standardization Branch, NRR

         10              DAVID SOLORIO, Safety Project Manager, NRR

         11              THOMAS KENYON, Environmental Project Manager, NRR

         12              BARRY ZALCMAN, Chief, Environmental Financial

         13                Section, NRR

         14              JACK STROSNIDER, Director, Division of Engineering

         15

         16

         17

         18

         19

         20

         21

         22

         23

         24

         25

                                                                       3

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

          2                                                     [9:31 a.m.]

          3              CHAIRMAN MESERVE:  Good morning, ladies and

          4    gentlemen.  Commissioner Dicus has informed us that she will

          5    be here shortly, was unavoidably detained.

          6              Our meeting this morning is to discuss the renewal

          7    of the license for the Calvert Cliffs Nuclear Power Plant,

          8    Units 1 and 2, for an additional 20 years beyond the current

          9    expiration dates.  As all of you know, Calvert Cliffs is the

         10    first plant that has gone through the Commission's license

         11    renewal process.

         12              As I understand it, the application was filed in

         13    April of 1998.  Since that time the staff has completed both

         14    its safety review and its environmental review for this

         15    facility and has recommended, on the basis of that, that the

         16    plant be renewed.  The ACRS has also evaluated the situation

         17    and has also recommended license renewal.

         18              This is really an outstanding achievement for us

         19    in that I think that this is really in some sense an

         20    historic meeting because this is, as you know, the first

         21    plant that has gone through this process and we have done it

         22    with really remarkable efficiency.

         23              The Oconee plant analysis is now in the final

         24    stages as well, and it is my understanding that there are

         25    two more applications that have now been received by the

                                                                       4

          1    NRC.  An expectation that we may receive -- we expect 15 and

          2    there may well be many more that come in.

          3              This is, I think, a development no one would have

          4    anticipated three or four years ago, and it is one that I

          5    believe is a credit to my efforts of my fellow

          6    Commissioners, in that I wasn't here for a lot of the work

          7    that was done on this, but is a credit to them that we have

          8    accomplished this.  And it is a glowing compliment to the

          9    NRC staff for not only their -- for the expeditious

         10    processing of these materials, which I think has encouraged

         11    other licensees to come forward.

         12              Let me turn to my colleagues and see if they have

         13    any opening statements.  Commissioner Merrifield.

         14              COMMISSIONER MERRIFIELD:  Mr. Chairman, yes, I

         15    would like to join you in commending the staff for what I

         16    agree is an outstanding job for the way they have conducted

         17    themselves on the Calvert Cliffs license renewal

         18    application.  I think they have managed the process very

         19    well.  They worked to have significant stakeholder

         20    involvement and a thorough and timely review.

         21              Congress, as we all know, has been looking very

         22    closely at the work that we have been doing as an agency and

         23    using this effort as a litmus test on our ability to meet

         24    our deadlines.  The fact that we set out with a 36 month

         25    time period expecting that that would be what it would take,

                                                                       5

          1    we are now coming in at around 24 months, speaks to I think

          2    an outstanding job.

          3              In addition, at the time when this renewal began,

          4    I think there was an expectation a significant number of the

          5    plants in the current inventory would not seek to renew

          6    their licenses.  As a result of the disciplined process that

          7    we have undertaken, the meetings that I have personally had

          8    with a number of CEOs last year indicate to me that a very

          9    small number of the existing plants will not seek to renew

         10    licenses.  So I think that really demonstrates a belief that

         11    we can come through this and do it in a disciplined manner.

         12              The final point I would want to make is, I

         13    normally don't do this, but I think it is worth of an

         14    exception, I think Chris Grimes in particular should be

         15    recognized for a real leadership role in this process and

         16    should be complimented for really bringing this one past the

         17    line, and so I did want to make that particular note.

         18              Thank you, Mr. Chairman.

         19              COMMISSIONER DIAZ:  I might want to add something

         20    I never do, but let me just support the statements of both

         21    the Chairman and Commissioner Merrifield.  I want to just

         22    maybe think a little bit out of the box of what it means to

         23    have license renewal.  As you know, right now in the world

         24    people are looking at what we are doing.  And what we are

         25    doing is really following the law.

                                                                       6

          1              When the Atomic Energy Act was established, it was

          2    established so that this country would be able to determine,

          3    according to a set of rules, whether we should have these

          4    areas of technologies, including nuclear power.  And it is

          5    the duty of this agency to analyze, develop and establish

          6    those rules those rules that will permit it, if it is in the

          7    best interests of the country to proceed.  And I think what

          8    we have done in this case is following the spirit and the

          9    thoughts of the law to allow that to happen when it is in

         10    the best interests of this nation.  And in this case I think

         11    we have done that, and I am very proud to have participated

         12    in the effort.

         13              COMMISSIONER McGAFFIGAN:  Mr. Chairman, I will

         14    agree with all the other statements and just note that I

         15    think Catch is now in, so we do have yet another application

         16    on schedule in, and if Calvert does get approved shortly, we

         17    will still have two -- three applications, Oconee, Arkansas

         18    Nuclear 1, and Hatch currently under review with more coming

         19    in.  And the staff has done a great job, but they are not

         20    going to be allowed to rest on their laurels.

         21              CHAIRMAN MESERVE:  Why don't we proceed.  Mr.

         22    Travers.

         23              MR. TRAVERS:  Good morning.  And we will start by

         24    not resting today.  We have a presentation and expectations

         25    are high and we think they should be.  We share -- we first

                                                                       7

          1    of all appreciate the comments by the Chairman and the

          2    Commissioners on our efforts in license renewal and

          3    certainly they have been significant and we view this

          4    meeting as a significant milestone in our efforts to address

          5    the first application for renewal from Calvert Cliffs.

          6              And if I could have Slide 2.  We are, of course,

          7    as you pointed out, Mr. Chairman, here to discuss with you

          8    the results of our review of the Calvert Cliffs license

          9    renewal application.  And I think it is important to note

         10    that we have been on the road of license renewal for some

         11    time.  The Commission, in my view, had the foresight,

         12    beginning in the mid '80s or so, to decide that even well

         13    before any nuclear power plant licenses expired, that we

         14    needed to have in place the set of regulations and detailed

         15    guidance for how we would carry out our technical reviews of

         16    license renewal applications.

         17              It took us some time to do that, but I think we

         18    have been successful in establishing both the regulations

         19    and the processes that we need to implement to carry out

         20    reviews in a predictable way to give some assurance to

         21    stakeholders generally, and our licensees in particular,

         22    that we can in a very disciplined way approach license

         23    renewal with a main goal of determining whether nuclear

         24    power plants can operate safely in the renewed period.

         25              So with that, I will note that we are also today

                                                                       8

          1    requesting the Commission to authorize the Director of NRR

          2    to renew the operating licenses of the Calvert Cliffs Units

          3    1 and 2.  And I would like to begin by presenting the people

          4    at the table who are largely responsible for what has been

          5    an outstanding effort, really a multi-office effort on the

          6    part of the NRR, the Regions, the Office of Research.  But

          7    let me introduce, beginning on the far left, Tom Kenyon, who

          8    is an Environmental Project Manager in the Office of Nuclear

          9    Reactor Regulation; Dave Solorio, who is the Safety Project

         10    Manager; Chris Grimes, who you have already recognized as

         11    the Chief of the License Renewal and Standardization Branch;

         12    Roy Zimmerman, who is the Deputy Director of the Office of

         13    Nuclear Reactor Regulations; and down from Pennsylvania,

         14    Brian Holian, who is the Deputy Director of the Division of

         15    Reactor Safety in Region I.

         16              And with that, let me turn it over to Roy

         17    Zimmerman.

         18              MR. ZIMMERMAN:  Good morning.  Could I have the

         19    next slide, please?

         20              The staff carried out its review of the Calvert

         21    Cliffs application with recognition of our four performance

         22    goals, and all four of these goals are important to us.  But

         23    we also recognize that the maintain safety goal takes

         24    precedence over the other goals, the other key goals.

         25              Regarding maintaining safety, the staff's review

                                                                       9

          1    focused on ensuring that the aging effects would be

          2    adequately managed, and the bulk of our presentation this

          3    morning will address this issue.

          4              On the topic of public confidence, there have been

          5    over 30 public meetings that have been held at a management

          6    level with the applicant during this review process, and

          7    about one-third of those were held in the vicinity of the

          8    site.  With the environmental scoping reviews, we used a

          9    facilitator to try to enhance public participation, and the

         10    involvement of the public is important to us in this process

         11    and we continue to look to make additional strides in that

         12    area with future applications.

         13              With regard to reducing unnecessary regulatory

         14    burden, we believe that future applicants will, in fact,

         15    benefit from the first two applicants going through, both

         16    Calvert Cliffs and Oconee.  In fact, in the Arkansas Nuclear

         17    1 application, they were able to model the form and content

         18    over the Oconee application, and we have already started

         19    seeing efficiencies in that regard.  Also, the requests for

         20    additional information that have gone out with the first two

         21    applicants have provided the following applicants to be able

         22    to try to resolve those issues in their applications.

         23              So we are upbeat and optimistic about the

         24    efficiencies that can be gained in this process.  We are

         25    also, as you are aware, actively working with the Generic

                                                                      10

          1    Aging Lessons Learned Report and update of the Draft

          2    Standard Review Plan that will provide the framework for

          3    future applications.  And the staff, in addition to working

          4    on the individual applications, is aggressively working on

          5    those generic initiatives.

          6              And, lastly, I will mention an area of

          7    effectiveness and efficiency.  Clearly, the GALL and SRP are

          8    a key to that.  And to this point, we are very comfortable

          9    and pleased, as already has been mentioned, that we have met

         10    all the milestones for both Calvert Cliffs and Oconee to

         11    date.

         12              The next slide, please.  I think the way I want to

         13    address this slide, rather than a top-down approach, is to

         14    take a bottom-up approach, if I can.  The monitoring and

         15    oversight aspects with regard to license renewal, both

         16    plant-specific and the process improvements.  Being that

         17    Calvert represents the first application, as we noted, we

         18    have provided considerable monitoring and oversight of the

         19    individual applications, as well as the generic process

         20    improvements.

         21              There have been monthly management meetings that

         22    have been held with BG&E; to address the technical issues and

         23    the open items.  There has been a License Renewal Steering

         24    Committee that was established that is comprised of senior

         25    managers from NRR, from Research, from OGC and from the

                                                                      11

          1    Regions that has interacted with a similar Executive

          2    Committee from NEI and from the industry that has served as

          3    a lightning rod for issues both of a technical nature and as

          4    well for process improvements, to raise those issues forward

          5    so that we continue to make the necessary strides and

          6    continue to advance the process.

          7              The Executive Council has had a hands-on

          8    involvement as well.  The Steering Committee has been

          9    briefing the Executive Council on a bimonthly frequency. 

         10    The Steering Committee, likewise, has met bimonthly with the

         11    NEI Steering Committee, and the Executive Council has

         12    reviewed the progress, reviewed the planning and resources

         13    associated with this effort and has ensured that policy

         14    matters warranting Commission attention be raised, such as

         15    in the area of credit for existing programs.  So the

         16    monitoring and oversight has served well in this effort as

         17    well.

         18              With that, let me pass the presentation to Chris

         19    Grimes.

         20              MR. GRIMES:  Thank you, Roy.  If I could have

         21    Slide 5, please.

         22              I would like to start off by pointing out some

         23    specific features of the license renewal process that were

         24    provided when the regulation was amended in 1995.  And I

         25    would like to cite from the Statements of Consideration some

                                                                      12

          1    of the clarity in the mission that we set out on.

          2              The first principle of license renewal was that,

          3    with the exception of certain age-related degradation, the

          4    regulatory process is adequate to ensure that the licensing

          5    basis of all currently operating plants provides and

          6    maintains an acceptable level of safety.  That was very

          7    important for us because it established the focus that we

          8    needed to establish discipline in the review process.

          9              Secondly, and equally important, is the principle

         10    that license renewal holds that the plant-specific licensing

         11    basis must be maintained during the renewal term in the same

         12    manner, and to the same extent as during the original

         13    licensing term.  This was also important for us to establish

         14    discipline in the process because it made clear to us that

         15    the current licensing basis was important and needed to be

         16    managed separate from the renewal review.

         17              If I could have Slide 6, please.  Slide 6

         18    highlights some of the significant aspects of the renewal

         19    review process.  At about the time that Calvert Cliffs'

         20    application was submitted, the staff had established a clear

         21    plan and milestones for the conduct of a renewal review. 

         22    The plan was based on the review guidance which was

         23    established to ensure that the evaluation scope would be

         24    disciplined and focused on the desired outcome, that is, a

         25    determination that the aging effects would be adequately

                                                                      13

          1    managed for the period of extended operation.

          2              In addition, we evaluated time limited aging

          3    analysis, which are simply design analysis that have time

          4    assumptions in them that need to be either updated or

          5    managed during the period of extended operation.

          6              The renewal review guidance included Office

          7    Letters for the renewal review process that identified roles

          8    and responsibilities in the conduct of the renewal review;

          9    an Office Letter on the evaluation of environmental impacts;

         10    an industry guide on renewal; a Draft Standard Review Plan

         11    for license renewal; and Environmental Standard Review Plan;

         12    an inspection program description and inspection procedures.

         13              So we had established a fairly rigorous

         14    infrastructure when we began the reviews of the first two

         15    applications.  There was some concern that having the

         16    Standard Review Plan in draft form might hamper the renewal

         17    review.  On the contrary, we found that the guidance in the

         18    Draft Standard Review Plan was quite useful and helpful

         19    during the review of the first two applications and helped

         20    us to focus on areas where future process improvements could

         21    be focused.

         22              The renewal reviews also had the benefit of other

         23    regulatory process improvements like the single round of

         24    questions before defining issues to be resolved, weekly

         25    internal staff meetings to monitor review progress and

                                                                      14

          1    ensure accountability.  Monthly management meetings to

          2    communicate issues and to assign responsibility for actions,

          3    and accountability to ensure that all the milestones were

          4    met.

          5              With that overview of the renewal review process,

          6    I would like to turn the presentation over to David Solorio.

          7              MR. SOLORIO:  Thanks, Chris.  Could I have the

          8    next slide, please.

          9              Good morning, I am Dave Solorio, and I have served

         10    as the NRC Project Manager on the staff's safety review of

         11    the Calvert Cliffs license renewal application.

         12              Slide 7 highlights 13 of the more significant

         13    milestones for the safety review that occurred over a 21

         14    month period, including related inspection activities that

         15    will be discussed later by Brian Holian.

         16              The detailed safety review of Baltimore Gas &

         17    Electric's renewal application began upon receiving their

         18    application on April 10th of '98 and concluded with the

         19    issuance of NUREG-1705 documenting the staff's review and

         20    conclusion that the effects of aging for the structures,

         21    systems and components within the scope of license renewal

         22    would be managed during the renewal period.

         23              In February, around the first inspection, about 25

         24    staff and managers met with BG&E; staff at the Calvert Cliffs

         25    site over four days to resolve a significant number of

                                                                      15

          1    technical issues.  Over the 21 month period, the staff has

          2    held 28 public meetings with BG&E; and the Advisory Committee

          3    on Reactor Safeguards to ensure continued progress on the

          4    review and to resolve issues.  These meetings were in

          5    addition to the public meetings related to the inspection

          6    and environmental efforts.

          7              The safety review benefited from teamwork. 

          8    Research staff assisted with the resolution of technical

          9    issues and assisted with the inspections.  Technical

         10    specialists in headquarters worked closely with the renewal

         11    and regional staff to ensure that issues were clearly

         12    identified and resolved on a sound technical basis.

         13              Next slide, please.  The next slide presents two

         14    of the significant areas of the Calvert Cliffs' SER.  The

         15    BG&E; review began before the submittal of the April 10th

         16    application with the submittal of a methodology for scoping

         17    and screening required by 10 CFR 54.21(a)(2).  That was

         18    approved by the NRC in 1996, as well a few system reports

         19    prior to the submittal of BG&E;'s renewal application. 

         20    Therefore, the staff's review focused on BG&E;'s

         21    implementation of the previously approved methodology.  In

         22    the future, we would expect to review the methodology as

         23    part of the application.

         24              Chapter 2 of the SER documents the staff's

         25    evaluation of BG&E;'s determination of which systems,

                                                                      16

          1    structures and components should be within the scope of

          2    license renewal.  Once the scoping evaluation was completed,

          3    the next step, screening, involved evaluating the

          4    determination of which passive, long-lived structures and

          5    components were subject to aging management.

          6              The review in this area, predominantly performed

          7    by systems specialists, went much quicker in that there were

          8    less issues that required interaction between the staff and

          9    BG&E;.  In other these areas, the staff only identified a few

         10    issues related to specific components, for example, the

         11    station blackout diesel generator building or service water

         12    heater.

         13              Next slide, please.  The next slide highlights the

         14    two areas of the SER where the majority of the staff efforts

         15    were expended.  First is aging management, which is covered

         16    in Chapter 3.  In this chapter the staff evaluated BG&E;'s

         17    identification of the applicable aging effects and proposed

         18    aging management programs to ensure the intended functions

         19    for the relevant equipment would be maintained.

         20              The majority of the issues in the area related to

         21    the extent to which existing programs were determined to be

         22    adequate for aging management, and fell into three

         23    categories.  A large majority of the existing programs, such

         24    as the vessel surveillance, system inspections, and

         25    environmental qualification, were determined to provide

                                                                      17

          1    adequate aging management.

          2              Modifications to existing programs were made such

          3    as the scope of walkdown inspections, which were expanded to

          4    inspect additional components, supports and structures;

          5    additional inspections for small bore piping and the

          6    pressurizer; and the plant-specific resolution of fatigue

          7    environmental effects related to GSI-190.  And new programs

          8    were proposed for the diesel fuel tank caulking and sealants

          9    that perform flood protection barriers and buried piping.

         10              It is expected that the Lessons Learned in this

         11    area will significantly improve the efficiency of future

         12    renewal reviews.

         13              The next significant area of the SER was the

         14    evaluation of the time-limited aging analyses discussed in

         15    Chapter 4.  In this chapter, staff evaluated BG&E;'s methods

         16    to determine how analyses with time-limited assumptions have

         17    been or would be managed for the period of extended

         18    operation.  Time-limited aging analyses included pressure

         19    temperature limits for the reactor coolant system, various

         20    fatigue analyses which assume a number of cycles over a life

         21    period and environmental qualification, which establishes a

         22    qualified life for each electrical component.

         23              The staff determined that the time-limited aging

         24    analyses would be adequately managed during the renewal

         25    term.

                                                                      18

          1              Next slide, please.  The next slide lists some

          2    significant observations and accomplishments from the

          3    staff's safety review.  First, the staff confirmed that many

          4    existing programs provided adequate aging management. 

          5    Second, some programs required documentation and new

          6    programs were created.  For example, BG&E; modified the

          7    Calvert Cliffs alloy-600 program to include all alloy-600

          8    components, not just that perform a pressure boundary

          9    function.

         10              BG&E; agreed to additional inspections of small

         11    bore piping and the pressurizer cladding for cracking, and

         12    agreed to a plant-specific resolution for GSI-190.  And BG&E;

         13    developed a new tank internal inspection program for the

         14    diesel fuel storage tank.

         15              Third, BG&E; also proposed one-time inspections,

         16    which collectively were called age-related degradation

         17    inspections, to confirm the absence of potential aging

         18    effects warranting management or to demonstrate program

         19    adequacy, where appropriate.  In a few instances the staff

         20    determined that periodic was more appropriate.

         21              And, finally, the staff included a proposed

         22    license condition as one approach to provide regulatory

         23    control under 50.59 for changes to the procedures relied on

         24    for the conclusions in the safety evaluation, as are listed

         25    in Appendix C to NUREG-1705, which BG&E; will incorporate

                                                                      19

          1    into the Calvert Cliffs final safety analysis report

          2    following the issuance of a renewed license.

          3              Next slide, please.  All of the aging management

          4    issues and identification of time-limited aging analyses

          5    have been resolved, as documented in NUREG-1705.  And on the

          6    basis of its evaluation of the Calvert Cliffs license

          7    renewal application, the staff concludes that the standards

          8    for issuance of a renewed license, as specified in 10 CFR

          9    54.29, have been met, which are summarized on this slide.

         10              First, actions have been identified and have been

         11    or will be taken with respect to managing the effects of

         12    aging during the period of extended operation on the

         13    functionality of structures and components that have been

         14    identified to require an aging management review under

         15    54.21(a)(1).

         16              Second, actions have been identified and have been

         17    or will be taken with respect to time-limited aging analyses

         18    that have been identified to require review under 54.21(c). 

         19    Therefore, the staff finds there is reasonable assurance

         20    that the activities authorized by a renewed license will

         21    continue to be conducted in accordance with the current

         22    licensing basis for the Calvert Cliffs Nuclear Power Plants,

         23    Units 1 and 2, as modified by the renewal program changes.

         24              And with that, those are my remarks.  Tom.

         25              MR. KENYON:  Good morning.  My name is Tom Kenyon,

                                                                      20

          1    I am the Environmental Project Manager on Calvert Cliffs.

          2              Can I have the next slide, please?  My first slide

          3    describes why we do an environmental review.  The NRC has

          4    the regulatory responsibility to implement the requirements

          5    of the National Environmental Policy Act for the nuclear

          6    plants under its purview.  Under the National Environmental

          7    Policy Act, an Environmental Impact Statement is required

          8    for any major federal action that could significantly affect

          9    the quality of the human environment, and the NRC has

         10    determined that license renewal is just such a major federal

         11    action.

         12              In 1996 the Commission promulgated 10 CFR Part 51

         13    to implement the requirements of the National Environmental

         14    Policy Act.  The rule reflects the findings of the Generic

         15    Environmental Impact Statement for license renewal known as

         16    NUREG-1437.  And the rule established a framework for

         17    addressing over 90 environmental issues.

         18              These issues were separated into one of two

         19    categories, either those that were generically resolved, as

         20    discussed in the Generic Environmental Impact Statement, or

         21    those for which a site-specific evaluation is required.  In

         22    addition, there were two issues which were not categorized,

         23    environmental justice and the health effects of

         24    electromagnetic fields, and because they were not

         25    categorized, however, the staff still performs the

                                                                      21

          1    site-specific evaluation of the issues.

          2              The rule dictates that the NRC issues a

          3    site-specific supplement to the Generic Environmental Impact

          4    Statement.  Supplement 1 was the supplement for Calvert

          5    Cliffs, and in that supplement we discuss whether or not

          6    there was any new and significant information on any one of

          7    these issues.

          8              Can I have the next slide, please?  During the

          9    review period, the staff visited the site and provided

         10    members of the public with two opportunities for public

         11    interaction.  The first comment period began at the

         12    beginning of the review while the staff was trying to

         13    determine the scope of its environmental review.  The second

         14    comment period occurs after the Draft Environmental Impact

         15    Statement was issued to allow members of the public to

         16    comment on our review.

         17              The staff, during both of those comment periods,

         18    the staff had public meetings to outline the NRC's process

         19    and to try to provide information to help members of the

         20    public focus on the issues.  As you can see, the staff

         21    issued the final Environmental Impact Statement in October

         22    of 1999.

         23              Next slide, please.  Of the 90-some issues that

         24    were evaluated, 16 issues were determined not to be

         25    applicable to Calvert Cliffs either because of the design of

                                                                      22

          1    the plant, or because no major refurbishment activities were

          2    planned.  All the other issues were considered and evaluated

          3    in the Supplement 1.

          4              For your information, I have identified the key

          5    findings from the review.  The first issue resulted from a

          6    recommendation from the U.S. Fish & Wildlife Service, who

          7    recommended that The Nature Conservancy, an international

          8    conservation group, we allowed foot access to the beaches

          9    below the cliffs so they can do monitoring of the tiger

         10    beetle population, an endangered species.

         11              The second recommendation from the Fish & Wildlife

         12    Service was that BGE set constraints on activities within

         13    one-quarter mile of the active bald eagle nests.  BGE agreed

         14    to allow The Nature Conservancy escorted foot access and, of

         15    course, they have agreed to set construction constraints on

         16    the bald eagle nests' vicinities.

         17              During the scoping period, one member of the

         18    public raised the concern that -- he wanted to know if

         19    microorganisms that could potentially develop and survive in

         20    the high temperature and high radiation areas of the nuclear

         21    plant could develop, and he also wanted to know what would

         22    be the consequences should such microorganisms be released

         23    to the environment.

         24              The staff consulted microbiologists that

         25    specialize in the study of these, such microorganisms, and

                                                                      23

          1    concluded that even if such microorganisms could develop,

          2    say, in the spent fuel pool of a reactor at a reactor plant,

          3    that because they had adapted so well to the extreme

          4    environment of the high temperature waters, that if they got

          5    released into the environment, such as into the Chesapeake

          6    Bay, that they would be unlikely to survive.  Therefore, the

          7    staff determined that, although this was a new issue that

          8    was raised, it was not significant because of the low

          9    likelihood of survival of these microorganisms.

         10              As part of its review, the staff also takes a look

         11    at the severe accident mitigation -- severe accident design

         12    alternatives, and concluded that BGE made a reasonable

         13    effort to try to identify and evaluate these design

         14    alternatives.

         15              The review of Calvert Cliffs identified four

         16    severe accident design alternatives that appear to be cost

         17    beneficial when averted onsite costs are considered.  The

         18    staff has determined that none of these four plant

         19    improvements are related to aging and, therefore,

         20    implementation is not required as a condition of license

         21    renewal.

         22              BGE has indicated that they intend to implement

         23    one of these, it is the installation of water-tight door to

         24    reduce flooding potential.  And the staff is further

         25    evaluating the Calvert Cliffs risk assessment to better

                                                                      24

          1    understand why Calvert Cliffs' core damage frequency appears

          2    to be higher than other CE plants of similar design.

          3              BGE is also reviewing their PRA to see if

          4    improvements are warranted.  As a matter of fact, the staff

          5    is in the process of scheduling a public meeting with BGE to

          6    pursue this matter further.

          7              Once a realistic and up-to-date risk profile for

          8    the plant is established, we will determine whether or not

          9    implementation of these alternatives might be warranted

         10    under the current operating license.

         11              Next slide, please.  That brings us to our

         12    conclusion, that the staff recommends that the Commission

         13    make a determination that the environmental impacts of

         14    renewing the Calvert Cliffs license are acceptable during

         15    the license renewal period.

         16              MR. HOLIAN:  Next slide, please.  Good morning,

         17    Chairman, Commissioners.

         18              The Region performed three license renewal

         19    inspections.  Michael Modes, a Senior Reactor Inspector in

         20    the Division of Reactor Safety led all three teams and

         21    Michael is also here today sitting behind me.  I will note

         22    at this time that for consistency and to promote Lessons

         23    Learned among the regions, there were team members from

         24    Region I and II on each other's inspections, since both

         25    these applications came in in a timely manner with each

                                                                      25

          1    other.

          2              The bullets on your slide, on the first slide,

          3    summarize the objectives of the first two inspections, and

          4    these were based on the inspection procedure for license

          5    renewal.  The first inspection, which was a week long,

          6    focused on scoping and screening.  Scoping was evaluating

          7    the systems and structures excluded from the scope of

          8    license renewal and the screening process was sampling from

          9    a scoped-in system what components are included in the age

         10    management assessment.

         11              The second inspection was a two-week long

         12    inspection and it looked at this aging management process by

         13    determining if credible aging mechanisms were identified and

         14    whether aging management was adequately demonstrated.

         15              The third and final inspection, which didn't occur

         16    till the end of the year, in December '99, looked primarily

         17    at open items from the first two inspections.

         18              The next slide, please.  The team selected the

         19    inspection sample sets based on a review of the Calvert

         20    Cliffs IPE and this was coupled with a detailed regional

         21    inspection plan review.  For example, the 13 kilovolt

         22    system, the turbine building ventilation system and fire

         23    pump house were among those systems and structures chosen to

         24    evaluate the scoping process.  These were systems or

         25    structures that were excluded from their initial review.

                                                                      26

          1              The team had two findings related to scoping.  One

          2    involved the exclusion of the fire pump house dike which was

          3    intended to contain an oil spill from impacting the electric

          4    fire pump that was in the same building.  The issue was

          5    placed in the licensee's license renewal corrective action

          6    plan, and it resulted in that aspect being scoped within the

          7    rule.  The second issue dealt with the support structures

          8    for the station blackout diesel.

          9              Related to screening, aux feedwater, salt water,

         10    safety injection and the auxiliary and safety-related diesel

         11    buildings were among those systems and structures which

         12    received a more detailed look by the team to determine

         13    whether systems -- the systems components and/or

         14    commodities, that would be like the piping or pipe supports,

         15    were included or excluded once a system was scoped-in.

         16              These components then, by the rule, receive an

         17    aging management review by the licensee.

         18              The bulk of the inspection effort was spent on the

         19    two-week inspection that occurred in April of '99, and that

         20    centered on whether BG&E; properly implemented the aging

         21    management methodology which had been previously approved by

         22    the NRC.  Examples of some aging mechanisms that were

         23    reviewed during the second inspection included galvanic

         24    corrosion, pitting, fatigue and primary water stress

         25    corrosion cracking.

                                                                      27

          1              In addition to a documentation review of the paper

          2    work that BG&E; had developed for analyzing these aging

          3    mechanisms, comprehensive system walkdowns were performed

          4    during this inspection, and it was crucial that this was

          5    done during an outage time to avail themselves to

          6    containment.  Region II inspection, they went back and

          7    looked during an outage time to pick up those portions of

          8    the system that were inside containment.

          9              During this two-week inspection, an example of an

         10    issue that was identified was where BG&E; had credited the

         11    ISI program, or inservice inspection program, for managing

         12    primary water stress corrosion cracking.  And the team

         13    pointed out, this was in the RCS system, that the ISI

         14    program excludes small bore piping, that is about one inch

         15    and less.  In response, BG&E; expanded their existing

         16    alloy-600 program to include small bore piping.

         17              Next slide, please.  As I mentioned, the third

         18    inspection was to pick up open items.  That occurred in

         19    December of '99 and, overall, I would like to state that the

         20    Region's inspections were timed to correspond with the

         21    development of the safety evaluation for Calvert Cliffs, and

         22    this process worked well at integrated reviews by the

         23    program office and the Region.  One of the items looked on

         24    during our final inspection was an item that had come up

         25    during the safety evaluation review on CVCS insulation.

                                                                      28

          1              Overall, the Region concluded in a memo dated

          2    January 13th, 2000 from "Hub" Miller that the scoping and

          3    the screening process was implemented in conformance with

          4    BG&E;'s application.  Applicable aging mechanisms were

          5    identified.  Appropriate aging management programs were

          6    developed.  Documentation was auditable.  And that BG&E;'s

          7    aging management programs provide an adequate foundation for

          8    renewing the license.

          9              MR. ZIMMERMAN:  Next slide, please.  In summary,

         10    the staff concludes that the safety review, the evaluation

         11    of the environmental impacts, and the inspection

         12    verifications support renewal of the licenses for Calvert

         13    Cliffs Units 1 and 2, and the staff requested the Commission

         14    authorize the Director of NRR to renew both of those

         15    licenses.

         16              MR. TRAVERS:  That concludes our presentations,

         17    Mr. Chairman.

         18              CHAIRMAN MESERVE:  Thank you very much for a very

         19    helpful briefing.  I have just a few questions.  One of them

         20    was precipitated by one of the comments that was made on

         21    Slide 14.  You indicated that the core damage frequency that

         22    you observe at Calvert Cliffs is higher than for other CE

         23    plants of similar design and vintage.  Is that an issue that

         24    is one that is being pursued in the context of the license

         25    extension?

                                                                      29

          1              MR. GRIMES:  No, sir.  No, sir, that is being

          2    pursued in the context of the existing license.

          3              CHAIRMAN MESERVE:  So if there is an issue there,

          4    that is something that you will pursue during the remaining

          5    term of the operating license?

          6              MR. GRIMES:  That is correct.  We weren't going to

          7    attempt to let that be put off.  And there has been an

          8    ongoing dialogue on the existing license relative to what

          9    the implications of the core damage frequency are, and the

         10    means by which the core damage frequency could be reduced. 

         11    And those will continue independent of the license renewal

         12    decision.

         13              CHAIRMAN MESERVE:  The proceduralist matter here

         14    may reflect my ignorance of the process here.  It is curious

         15    to me that this is an issue that popped up in your

         16    environmental review rather than the safety review.  Is

         17    there any easy explanation for that?

         18              MR. GRIMES:  The best, the simplest explanation

         19    that I can give is that the issue of the -- the value of the

         20    core damage frequency already existed and was being pursued. 

         21    These four specific cost beneficial alternatives, mitigation

         22    alternatives, they arose from the review of the cost

         23    beneficial -- or, excuse me, the design alternatives that

         24    were being -- would have been considered.  And so we were

         25    pursuing it in one way and then found something else to

                                                                      30

          1    complement that activity.

          2              MR. ZIMMERMAN:  If I can make a comment on the

          3    Calvert Cliffs IPE, I think the utility believes that there

          4    are conservatisms in the modeling of that PRA and are

          5    intending on continuing to review that area.  And we intend

          6    on maintaining dialogue starting next month with the utility

          7    to understand the areas where they feel some of those overly

          8    conservative modeling aspects are in their IPE, as well as

          9    those areas that the utility is looking for in terms of

         10    potential modifications.

         11              Also, the staff has the ability to look at the

         12    results as well from the standpoint of our process for

         13    backfitting.

         14              CHAIRMAN MESERVE:  I would like to ask you, if you

         15    could, to just step back for a moment from this particular

         16    application.  Obviously, you have done a remarkable job in

         17    meeting all the deadlines, but I am curious as to whether

         18    there are any observations you would make about the process

         19    as it exists now that ought to be modified in order to make

         20    this an even more efficient process in the future.

         21              MR. GRIMES:  Is your question relative to the

         22    license renewal process?

         23              CHAIRMAN MESERVE:  Yes, license renewal process.

         24              MR. GRIMES:  Actually, we have collected a number

         25    of observations about how we could simplify the review

                                                                      31

          1    process, how we could take advantage of the Generic Aging

          2    Lessons Learned and cataloging findings on generic programs. 

          3    That should make the review process much simpler in the

          4    future.  And we have put all of those good ideas that have

          5    been collected over the last two years into our efforts to

          6    revise, update the SRP and then engage the public in a

          7    dialogue about how those process improvements might be

          8    implemented.

          9              DR. TRAVERS:  I think in a broader sense, in an

         10    implementation sense, we are looking for improvements to see

         11    how we can better carry out the requirements of today's

         12    rule.  In addition, we are going to look in the longer term

         13    at the rule itself and the process that is required under

         14    that rule.  So, I think in the longer term, perhaps with

         15    some more experience from a BWR and some more of the plants

         16    that are in the pipeline currently, we are looking at the

         17    potential for any improvements that might argue for, as

         18    formal changes, a rule change.  We haven't identified any.

         19              CHAIRMAN MESERVE:  As you know, we do intend as a

         20    Commission to reexamine this after the first two to see

         21    whether they are changes.  I just wanted to ask the

         22    question, whether there is anything that jumps out now as

         23    being so obvious a change that we ought to take action?  And

         24    I guess my impression is the changes are incremental and, as

         25    appropriate, you have been incorporating them in the SRP and

                                                                      32

          1    the GALL.

          2              MR. GRIMES:  Yeah.  It occurs to me, there was one

          3    that jumped out for which we have already taken action, and

          4    that was to come up with a standard form and content, a

          5    better packaging, because we found that we were working a

          6    three-dimensional problem.  We had structures and

          7    components, and aging effects, and then programs that cut

          8    across all of them.  A corrosion program can apply across

          9    all of the components.  So we found that there was a lot of

         10    repetition in what we were doing.  We are looking at

         11    chemistry over here and then chemistry over there.

         12              So we met with the industry and the first two

         13    applicants, and we talked about ways to better package the

         14    information so that the review could be more efficient.  And

         15    we have already agreed on a new standard form and content,

         16    and that is being reflected right now in an update to the

         17    industry guide that was just submitted.

         18              CHAIRMAN MESERVE:  Thank you very much.

         19              MR. ZIMMERMAN:  If I can add that in addition to

         20    the work that is ongoing with the GALL and SRP effort, the

         21    utilities that have been in the pipeline have been watching

         22    very closely and have been attending meetings to be able to

         23    learn those lessons of the types of questions we have been

         24    asking, so that they can answer those and address those in

         25    those submittals.  And we have seen that in the ANO

                                                                      33

          1    acceptance review that we recently performed.  So there are

          2    incremental gains that we are making while we are continuing

          3    to work on packaging the Lessons Learned in the GALL and SRP

          4    reports.

          5              CHAIRMAN MESERVE:  Commissioner Dicus.

          6              COMMISSIONER DICUS:  Thank you, Mr. Chairman. 

          7    First of all, let me apologize to my Commission colleagues,

          8    the staff, members of the public, the licensee, their

          9    representative for my late arrival.  I had a very early

         10    morning therapy session on my knee that went slightly awry

         11    so it had to be iced down for a while, but it is in a much

         12    better frame of mind, so, so am I.

         13              I probably have a couple of technical questions

         14    and then I want to follow up on one of the questions that

         15    the Chairman asked, and perhaps a process question.

         16              I noticed that with license -- potential

         17    conditions for Unit 2 are somewhat different than ones for

         18    Unit 1.  Could you give me a little bit of information about

         19    that?

         20              MR. GRIMES:  The differences between the two

         21    licenses exist today.  Those were there and we carried those

         22    over.  License renewal did not attempt to try and clean up

         23    the unit differences that have evolved over time.  One of

         24    the units has a loop operation limitation.  We didn't create

         25    those, we just carried them forward.

                                                                      34

          1              COMMISSIONER DICUS:  Okay.  The second question

          2    has to do with these cables that are buried or inaccessible. 

          3    I understand the licensee has made some commitments on what

          4    they are going to do about that.  Could you give me some

          5    information on what those commitments are?

          6              MR. GRIMES:  Dave, do you recall the specifics of

          7    the cable inspection program?

          8              MR. SOLORIO:  Well, to address what I think you

          9    are asking is BG&E; has committed to take the root cause

         10    results that are available from the Davis-Besse event and

         11    evaluate their inaccessible cables that are potentially

         12    subjected to wet environment to determine if the root cause

         13    would drive them to make any modifications to their program. 

         14    And they made a commitment to that effect in a letter dated

         15    the 13th or the 12th of January.

         16              MR. GRIMES:  But to answer your question more

         17    broadly, in both of the applications, we have looked for a

         18    more robust inspection program for cable insulation that

         19    will extend observations into cables that are in

         20    inaccessible areas.

         21              COMMISSIONER DICUS:  Okay.

         22              MR. GRIMES:  And, in fact, we expect to see

         23    licensees replacing cable on the basis of their inspection

         24    findings.

         25              COMMISSIONER DICUS:  Okay.  So you are comfortable

                                                                      35

          1    with this?

          2              MR. GRIMES:  That is correct.

          3              COMMISSIONER DICUS:  A comfort level with it.  On

          4    your Slide 17, you mention some of the risk insights that

          5    were used in the renewal process.  Are these the only ones,

          6    or were there other risk insights used?

          7              MR. HOLIAN:  Well, for the selection of the

          8    systems, we used the IPE risk ranking.  Aux feed water was

          9    one of our primary systems, and the RCS was another one, and

         10    some of the electrical systems.  During the -- if you were

         11    determining were risk insights used during the safety

         12    evaluation review, I will turn that over to Dave.

         13              MR. GRIMES:  In the safety evaluation review, it

         14    is largely deterministic.  We are looking at programs to an

         15    applicable scope, and so we -- there wasn't really an

         16    opportunity for us to try and apply risk insights.  That is

         17    one of the potential process improvements we are considering

         18    for the future.

         19              COMMISSIONER DICUS:  Okay.  And then, finally,

         20    following up on the Chairman's questions with regard to

         21    Lessons Learned and what we are doing with the draft SRP, I

         22    wasn't clear whether you are going to try to make

         23    modifications in the draft SRP as we go along.  Are you

         24    going to wait at some point after we reevaluate the first

         25    two applications and then work on then?  That wasn't clear.

                                                                      36

          1              MR. GRIMES:  We have an established schedule in

          2    response to the Commission's staff requirements memo on

          3    credit for existing programs that lays out a fairly

          4    aggressive schedule to put together GALL and the SRP, go out

          5    for public comment and then bring back to the Commission

          6    those comments and a proposed resolution by about November. 

          7    We also have heard that we might want to come talk to the

          8    Commission in the summer about Lessons Learned, and as sort

          9    of an interim status report.

         10              COMMISSIONER DICUS:  Okay.  Thank you, Mr.

         11    Chairman.

         12              CHAIRMAN MESERVE:  Commissioner Diaz.

         13              COMMISSIONER DIAZ:  Yes.  Let's see, the first

         14    thing on technical issues.  On the work that the staff has

         15    done during all this time regarding the aging degradation,

         16    or the management of aging degradation, the things that

         17    really we work with, has there been any series of issues

         18    that all of sudden came out that were more important that

         19    actually, you know, you now can say these are the kind of

         20    issues that we really need to work with, and these other

         21    issues that we thought were not important are really not,

         22    you know, creating that much problem?  Have there been, with

         23    the watch, a series of issues come up that say these are the

         24    ones we need to deal with when we are dealing with aging

         25    issues?

                                                                      37

          1              MR. GRIMES:  I think it is interesting that when

          2    we were trying to assemble the Generic Aging Lessons Learned

          3    and catalog the programs, actually, we weren't surprised

          4    very much.  We found that the aging mechanisms that have

          5    evolved since the nuclear plant aging research began in 1982

          6    are still the effects that tend to occupy engineers and

          7    require close attention, stress corrosion cracking,

          8    reduction in brittle fracture, corrosion and erosion.  Those

          9    things still tend to dominate the needs of these programs.

         10              And then, of course, the resolution of Generic

         11    Safety Issue-190 concluded that, although it is not a

         12    serious enough effect to warrant backfitting all the fatigue

         13    analysis, there is an environmental effect that tends to eat

         14    away that margin that needs to be accounted for in fatigue

         15    management programs.  And, similarly, the environmental

         16    qualification research that is ongoing is still teaching us

         17    lessons about failure modes and effects for cable insulation

         18    that requires careful inspection and evaluation and

         19    corrective action.  But that basic process of inspecting for

         20    these effects, identifying where they are occurring and then

         21    correcting them, that is essentially what we rely on to

         22    ensure that aging management programs would be effective.

         23              COMMISSIONER DIAZ:  Okay.  But no new issues that

         24    are serious enough that might require that Research looks at

         25    it or that we put some emphasis on it just to make sure that

                                                                      38

          1    they are properly addressed and over the long periods of

          2    times that we are going to be doing license renewals, and

          3    plants that have been reviewed.

          4              MR. GRIMES:  I would say that the aging of cable

          5    insulation is one where we are pursuing, we are looking at

          6    the results of the Davis-Besse event and determining whether

          7    or not we should pursue more research in that area.  And

          8    that is something that Mr. Strosnider and Mr. Mayfield both

          9    have been quite helpful in the renewal process in terms of

         10    guiding the decision-making on what constitutes an

         11    acceptable aging management program.

         12              COMMISSIONER DIAZ:  No significant surprises on

         13    any of the mechanisms regarding stress corrosion cracking,

         14    fatigue, nothing that you will say it demands additional

         15    attention?

         16              MR. GRIMES:  No, nothing that surprised or showed

         17    us, but the usual frustrations, I would say.

         18              COMMISSIONER DIAZ:  Well, that is to be expected

         19    and that is what you get paid for.

         20              [Laughter.]

         21              COMMISSIONER DIAZ:  Now, let me turn to Slide 15,

         22    and you might have noticed that I am not a lawyer, so I have

         23    sometimes problems with wording.  But let me read this

         24    conclusion.  "The adverse environmental impacts of license

         25    renewal for Calvert Cliffs Nuclear Power Plant Unit 1 and 2

                                                                      39

          1    are not so great that preserving the options of licensee

          2    renewal for energy planning decision-makers would be

          3    unreasonable."

          4              Now, I don't know who crafted this or not, but if

          5    I were a member of the public and I would read this, I would

          6    say, well, they are not so great, but they might be great

          7    enough.  And, you know, although they might, you know, could

          8    be -- might not be unreasonable, are they reasonable?  And

          9    my question to you is, from the technical analysis, would a

         10    statement that would better reflect, you know, your

         11    conclusions, would it be adequate, and can we avoid having

         12    lawyers drafting this statement?

         13              I am sorry, Karen.

         14              MS. CYR:  Well, actually, the Commission approved

         15    this, of course, because this is in 51.95, when the

         16    Commission approved the Generic Environmental Impact

         17    Statement.

         18              COMMISSIONER DIAZ:  That was before my time.  I

         19    was in kindergarten when that happened.

         20              I think it is a statement that obviously, probably

         21    does what it is, but it might portray the wrong conclusion. 

         22    I am just bringing it on, that it is not so great, doesn't

         23    seem to me is a very definite conclusion.  And, you know,

         24    rather than would be unreasonable, you know, would be

         25    reasonable, be something more that to my -- you know, it

                                                                      40

          1    will really give me a better level of comfort in this

          2    environmental assessment.  Just bring that out.  I am sure

          3    it is going to create some alignments, and maybe Karen might

          4    be able to address it.

          5              MS. CYR:  Well, I mean the rule requires that the

          6    EIS contain the staff's recommendation regarding the

          7    environmental acceptability of the license renewal action. 

          8    I think they analyzed that in determining, in a sense, to

          9    include there their conclusions with respect to whether --

         10    that they are small and acceptable and so on.  But the

         11    ultimate finding which is reflected here was because of the

         12    interplay between what we are doing here in terms of the

         13    action that we have here.

         14              So it is not that we are making, because of the

         15    decision of whether or not that the plant will actually

         16    operate in a renewed period is the licensee's in conjunction

         17    with whatever their public utility commission decision with

         18    respect or not they can get approval, or whatever approvals

         19    they need with respect to operating the plant for an

         20    extended period, whatever those are.

         21              And so we are not here in a sense to be the final

         22    one who endorses whether or not that plant operates.  We are

         23    making a safety determination, an environmental

         24    determination of whether or not this plant meets our

         25    requirements such that the state PUC, with respect to

                                                                      41

          1    whatever decisions they have to make, can consider this. 

          2    And so that is why it is stated in this sort of cumbersome

          3    fashion.  In a sense, we are sort of preserving the option. 

          4    We are saying, yes, this option is a viable one.  From a

          5    safety and an environmental standpoint, that the state can

          6    feel free to consider it, assuming the licensee applies to

          7    operate this facility for an extended period of time beyond

          8    which they have already considered.

          9              So it comes out in kind of an awkward way.  But

         10    the staff, as the rule requires that they go ahead and make

         11    determinations on the environmental acceptability of the

         12    license renewal action, which they have done in the text and

         13    the body of the environmental report.

         14              CHAIRMAN MESERVE:  In fact, I would note that when

         15    this slide was summarized, I had the same problem.  And I

         16    noticed when this slide was summarized, the phraseology was

         17    used that the environment effects are acceptable during the

         18    license renewal term, so that the actual oral briefing we

         19    got did depart from the language -- or plain English.

         20              MS. CYR:  Because the rule requires, given this

         21    information, the Commission shall determine whether or not

         22    the adverse effects are so great that any option would be

         23    unreasonable.  I mean, but again, that is -- the staff is

         24    parroting back to you the language that was adopted in the

         25    rule.

                                                                      42

          1              COMMISSIONER DIAZ:  Okay.  Thank you.

          2              CHAIRMAN MESERVE:  Mr. McGaffigan.

          3              COMMISSIONER McGAFFIGAN:  I am glad that our

          4    Chairman, who is a lawyer, likes plain English, too.  But I

          5    do have to tell Commissioner Diaz, I have Part 51 in front

          6    of us, and I recall voting on it.  It was during our tenure.

          7              [Laughter.]

          8              COMMISSIONER McGAFFIGAN:  December 18th, 1996, the

          9    rule was effective.

         10              COMMISSIONER DICUS:  So we have to blame ourselves

         11    for this.

         12              COMMISSIONER McGAFFIGAN:  So we let it slip past

         13    us.

         14              COMMISSIONER DIAZ:  I have a very convenient

         15    memory.

         16              [Laughter.]

         17              COMMISSIONER MERRIFIELD:  Actually, just a note,

         18    just so the record is clear, both the attorneys on the panel

         19    have stated in public as of today that they are in support

         20    of plain English.  Having done so on many occasions in the

         21    past, I am glad that our Chairman has joined in that.

         22              COMMISSIONER DICUS:  But, actually, I guess

         23    neither one of them can be blamed for this because they

         24    weren't on the Commission.

         25              CHAIRMAN MESERVE:  They weren't on the Commission.

                                                                      43

          1              COMMISSIONER MERRIFIELD:  That's right.  Had we

          2    been, --

          3              COMMISSIONER McGAFFIGAN:  Let me start by again

          4    complimenting the staff.  I have said at previous meetings

          5    something along the lines of what Roy said at the outset,

          6    that we had an extraordinary process in this proceeding, in

          7    this review, to try and involved the public.  I am not sure

          8    the public always understood.  I have reviewed some of the

          9    dialogues at the Environmental Impact Statement, not the

         10    scoping meeting, but the comment meetings, and there was

         11    clear public misunderstanding of some of our processes.  But

         12    we had public meetings, 30 you count, I get about that

         13    number as I go through the SER and the EIS.  If you throw in

         14    the ACRS meetings, I think it is about 30.

         15              And any member of the public who wanted to have a

         16    significant role in this process was clearly afforded that

         17    opportunity in my view.  So I will just make point.  Perhaps

         18    we can improve it.  I think going through the process a

         19    couple of times will improve it.  But I think you got

         20    significant comments, certainly on the environmental side. 

         21    It is unfortunate that on the safety side, I don't think the

         22    opportunity was taken up as much to attend these monthly

         23    meetings and to raise issues.

         24              Another body I think I would like to thank, we

         25    should have done it yesterday, but ACRS, I think, did an

                                                                      44

          1    extraordinary job carrying out their statutory function of

          2    reviewing the safety evaluation report and getting their

          3    views in by December 10th, just -- I think it was 20 or 30

          4    days after the staff had completed the report and submitted

          5    it to them.  And we, obviously, from talking yesterday and

          6    listening to their priority of continuing to do a good job

          7    there, I think they continue to plan to do these parallel

          8    reviews that will allow for a very timely input from ACRS

          9    and allow these processes in the future to move rapidly.

         10              On the issue that the Chairman started with in

         11    the, you know, the severe accident mitigation alternative

         12    chapter, this issue of averted onsite comes up.  And I am

         13    sure you have had the conversation with Baltimore Gas &

         14    Electric, you know, the Commission unanimously last year

         15    said that averted onsite costs are an appropriate part of

         16    our analysis, it is consist with OMB guidance, et cetera, so

         17    there isn't an issue as far as this Commissioner or the

         18    Commission as a whole is concerned.  So I think some of the

         19    issues that are left for follow-up, I do hope you follow up

         20    in the new license period.

         21              One of the most risk -- 529, page 529 says the

         22    most risk significant enhancements, 48(a), has a CDF

         23    reduction of approximately 30 percent under bounding

         24    assumptions and 10 percent under best estimate assumptions. 

         25    It costs a bit, it costs half a million dollars is my

                                                                      45

          1    recollection from the chart, but I would think that any

          2    backfit analysis of 30 percent reduction in CDF, or at least

          3    a 10 percent would meet the substantial benefit test under

          4    backfit.  And, so, if this analysis is accurate, I sure hope

          5    you guys continue to pursue that.  Maybe not the license

          6    renewal staff, but the staff that handles the license as a

          7    whole.

          8              MR. GRIMES:  Yes, I would like to comment on that. 

          9    I may have muddied the waters before and I want to make sure

         10    that it is clear.  Before the license renewal application

         11    was received, the staff was already trying to understand the

         12    Calvert Cliffs model and its implications.  You know, why is

         13    the CDF for Calvert Cliffs so much higher than the rest of

         14    the combustion engineering fleet?

         15              And Baltimore Gas & Electric has already

         16    undertaken to start implementing those alternatives that

         17    they found to be cost beneficial without -- irrespective of

         18    the issue of averted onsite cost.  But when I spoke with

         19    Rich Barrett about the status of their review, the first

         20    thing the staff wants to do is to understand whether or not

         21    these things are modeling differences that might have

         22    generic implications before we would then pursue in a formal

         23    way a backfitting decision to determine whether or not we

         24    feel that these, with the consideration of averted onsite

         25    costs, it is worth requiring that these changes be made.

                                                                      46

          1              And in the meantime, BG&E; is continuing to refine

          2    their model and continue to implement changes.  So rather

          3    license renewal, you know, made a decision on the basis of

          4    the plant design at a point in time.  The process will

          5    continue to pursue that question.

          6              COMMISSIONER McGAFFIGAN:  Right.  That is all I am

          7    saying is I hope the process continues, if the analysis in

          8    here is accurate.  I mean there is this big issue and BG&E;

          9    was asserting the NEI and industry position, which we also

         10    heard when we were doing the CSIS report, that averted

         11    onsite costs shouldn't be part of our analysis.  But we

         12    would be unique in government if we were to drop averted

         13    onsite costs as part of a cost benefit calculation.  And, as

         14    I say, that decision has already been made, so future

         15    licensees, whether it is in license renewal or in Rich

         16    Barrett's shop, have to understand that that is part of the

         17    analysis and we are going to make judgments based on that.

         18              One of the things, in reviewing the SER -- in

         19    reviewing the EIS, there were an awful lot of comments on

         20    Category 1 issues, as I read it and read the transcript of

         21    some of these meetings, and those issues were largely

         22    resolved in this 1996 rulemaking that we all, at least three

         23    of us were present for.  Was there a lot of public

         24    involvement?

         25              I mean I don't -- I was new and I only dealt with

                                                                      47

          1    the paper as we received probably in October-November of

          2    '96, but the process presumably had preceded that rulemaking

          3    and that -- in the development of that GEIS.  GEISs have

          4    scoping meetings, they have public comment meetings.  Was

          5    there significant public involvement in that rulemaking?

          6              MR. GRIMES:  In the GEIS?

          7              COMMISSIONER McGAFFIGAN:  In the GEIS rulemaking

          8    back in '86?

          9              MR. GRIMES:  Tom, were you?  Hang on a second.

         10              MR. KENYON:  Mr. Barry Zalcman from the staff.

         11              MR. ZALCMAN:  My name is Barry Zalcman, Chief of

         12    the Environmental Financial Section in NRR.  The efforts to

         13    undertake that rulemaking began in the late 1980s and had

         14    significant involvement, significant workshops during the

         15    scoping process, as well as during the actual rulemaking

         16    process.  It involved not only interactions with the public

         17    but other stakeholders, Environmental Protection Agency,

         18    Council on Environmental Quality as well.  So there was a

         19    big effort.

         20              What had happened subsequent was the application. 

         21    The application came in in the late 1990s and the staff, in

         22    undertaking its review, looked at all the issues, even those

         23    considered Category 1 issues under the GEIS, to assure that

         24    no new and significant information had arisen since the

         25    snapshot of the GEIS, so that is the staff's obligation.

                                                                      48

          1              COMMISSIONER McGAFFIGAN:  But a lot of the

          2    comments, as I read them, were really challenging, without

          3    new information, challenging the Category 1 decisions that

          4    had been made in the 1996 rulemaking.

          5              MR. ZALCMAN:  Yeah, there have been concerns by

          6    the public on that.

          7              COMMISSIONER McGAFFIGAN:  The last issue I will

          8    raise is David Lochbaum, in a recent interview, had some

          9    comments on license renewal.  I will try to get to the heart

         10    of the technical comment if I can do that, and it seems to

         11    have to do with reactor vessel embrittlement.  You know, he

         12    cite the Yankee Rowe experience where they were coming in

         13    for a license renewal, discovered they had an embrittlement

         14    problem and then they obviously shut down.

         15              And what he says about this application that seems

         16    to be his concern, "There is some" -- "In the specific case

         17    of Calvert Cliffs, there is some concern about its reactor

         18    vessel similar, although not quite as bad as Yankee Rowe." 

         19    This is -- I am quoting Mr. Lochbaum.  "What Calvert Cliffs'

         20    owners are doing is using data from the Shoreham reactor

         21    that didn't operate very long," and that is an

         22    understatement, "and the McGuire reactor in North Carolina,

         23    both of which were built at about the same time, to give

         24    confidence in its own reactor vessel.  I have said that if I

         25    was in a hospital with a major illness, I wouldn't want the

                                                                      49

          1    doctor saying we are going to do surgery on you based on

          2    another guy who was about your age and weight, and he says,

          3    'You need your spleen removed.'"  It is typical David, it is

          4    great stuff.

          5              But did you guys rely on Shoreham and McGuire data

          6    in trying to deal with any reactor vessel embrittlement

          7    issues that there may or may not be at Calvert Cliffs?

          8              MR. STROSNIDER:  I am Jack Strosnider, Director of

          9    the Division of Engineering.  The answer is yes.  And I

         10    think perhaps a little explanation might help.

         11              COMMISSIONER McGAFFIGAN:  Sure.

         12              MR. STROSNIDER:  It helps to understand a little

         13    bit about how these vessels were fabricated and what was

         14    going on during the fabrication process.  They are

         15    fabricated from rolled plates that are welded into rings and

         16    then welded into a cylinder.  And if you can turn back the

         17    clock about 30 years or so when these vessels were on the

         18    floor of the vendors' shops, there was essentially an

         19    assembly line of reactor vessels in various stages of

         20    fabrication.  So on any given day, there would be welds

         21    being made in three or four different reactor vessels.  And

         22    when they went to the supply room to get the weld material,

         23    that weld would end up in three or four different reactor

         24    vessels.

         25              The weld material that is in the Calvert Cliffs

                                                                      50

          1    reactor vessel is also in the McGuire vessel, the Pilgrim

          2    vessel and the Shoreham vessel.  So, in fact, there are good

          3    data with regard to characterizing that weld material that

          4    should be used.  In fact, I would suggest we would be remiss

          5    if we didn't use it.

          6              With regard to chemistry, as an example, you can

          7    get copper and nickel values from all those weld materials

          8    to help better understand the chemistry of the weld, which

          9    influences the rate of embrittlement.  And in the case of

         10    Calvert Cliffs, actually, the limiting material in the

         11    vessel, that is the one that has the highest fluence and

         12    combination of material properties that will dictate its

         13    life, okay, is not actually in their surveillance program. 

         14    But it in the McGuire surveillance program.  So the notion

         15    is that you go look at how that material is performing in

         16    the McGuire vessel and understand then what that -- how that

         17    material responds.  And that is all very relevant to

         18    understanding the Calvert Cliffs analysis.

         19              It is a little tricky when you go from one vessel

         20    to another when there are different vendors.  I would point

         21    out Calvert Cliffs is, of course, CE, McGuire being

         22    Westinghouse.  But we have done -- the Research office has

         23    looked at this and we understand, for example, Calvert

         24    operates about 10 degrees lower than McGuire, but we know

         25    how to adjust for that based on research results.  So, it is

                                                                      51

          1    done very carefully, but, in fact, we do use data from the

          2    other plants, and it is very important data.  We would only

          3    be using a small portion of the available information if we

          4    didn't do that.  So that is the explanation.

          5              COMMISSIONER McGAFFIGAN:  I appreciate that, I

          6    think that is a very good explanation, trying to match

          7    Lochbaum, which is almost impossible.  It sounds like

          8    getting your spleen removed on the advice of the doctor.  If

          9    your twin has had previous problems with -- identical twin

         10    has previous problems with that spleen, you might want to

         11    have your spleen removed if you are showing similar

         12    symptoms.  But that is a poor imitation of David, and I

         13    apologize to him.  But I appreciate the explanation.

         14              CHAIRMAN MESERVE:  Commissioner Merrifield.

         15              COMMISSIONER MERRIFIELD:  Thank you, Mr. Chairman.

         16              Turning to Slide 10, the second bullet, where you

         17    talk about some programs are modified to ensure adequate

         18    aging management, and a plant-specific approach to resolve

         19    fatigue.  I am wondering if you could flesh this out for me

         20    a little bit more in terms of why you focus on a

         21    plant-specific approach to do this.  Could you explain why

         22    that was the right way to go?

         23              MR. GRIMES:  This was intended to be illustrative

         24    of the kinds of program changes that represent a license

         25    renewal impact, that 20 or so percent of the existing

                                                                      52

          1    programs that need to be augmented in order to account for

          2    an aging effect.  And in this particular case, it was also

          3    unique because there was an original expectation that

          4    Generic Safety Issue 190 was going to provide a generic

          5    solution that would identify what action would need to be

          6    taken, and we proceeded down that path.

          7              But then the result was a conclusion that there is

          8    no generic solution for it by means of backfitting

          9    requirements for fatigue analysis, but it is still an effect

         10    that needs to be addressed.  And BG&E; came in with a

         11    proposal for an inspection program that would monitor and

         12    correct for this environmental effect, and we found that

         13    plant-specific approach acceptable.

         14              COMMISSIONER MERRIFIELD:  You may not have this

         15    information on this readily available.  What level of

         16    inspection hours do we have to spend in order to conduct

         17    this license renewal effort?

         18              MR. HOLIAN:  It was, in general, right around 1

         19    FTE total.  That was what was scoped in the inspection

         20    procedure, between 1 and 1.2, and the Region used about 680

         21    hours direct inspection time and it was over 600 hours

         22    preparation and documentation time, too.  So you are looking

         23    around 1,300-1,400 hours.

         24              COMMISSIONER MERRIFIELD:  1,300-1,400.  Do you

         25    anticipate a similar level of effort with future license

                                                                      53

          1    renewals?

          2              MR. HOLIAN:  Yes.  Region II used about a little

          3    more in hours, from our understanding with them, and we

          4    worked closely with them.  And Region IV is scoping a little

          5    over 1 FTE also, and I think that is the assumption going

          6    out through 2002.

          7              MR. GRIMES:  From a planning perspective, I think

          8    that this three inspection set seems about appropriate, and

          9    that that level of verification is probably something we

         10    want to plan for.

         11              COMMISSIONER MERRIFIELD:  I was particularly -- my

         12    interest was particularly piqued by Slide 14, where we

         13    talked about microorganisms that thrive in high radiation,

         14    high temperature environments.  This is something new for

         15    us, and I think is reflective of the fact that we were

         16    really responsive to public concerns about new issues that

         17    were out there.  And so that was something that we

         18    considered and had to address.

         19              And I guess it raises a question to me.  We are

         20    going to have presumably similar questions raised down the

         21    road when we have new license renewals come in.  Do we feel

         22    we have got the resources and the expertise in-house to

         23    handle these types of environmental questions?

         24              MR. ZIMMERMAN:  I think that it is made up of a

         25    couple of parts.  We are somewhat reliant on contractor

                                                                      54

          1    assistance in this area for some of the specialty areas, but

          2    we also want to bring in some additional talent.  So, as we

          3    look at our hiring profile, we are looking at bringing on

          4    some additional talent in this area, but it will be

          5    significantly complemented through these contracts.

          6              DR. TRAVERS:  It is interesting to note that years

          7    ago, when we were actually in a very active licensing mode,

          8    that we had quite a lot more environmental specialist type

          9    scientists on the staff and that number has diminished

         10    significantly, but with the advent of license renewal, I

         11    think Roy has mentioned that we probably need to look at

         12    staffing that up some.

         13              COMMISSIONER MERRIFIELD:  Well, obviously, that

         14    may be part of the GALL report.

         15              MR. ZALCMAN:  If I could add again, this is Barry

         16    Zalcman, staff.  This is an issue the Commission had raised

         17    in an earlier context, in the early 1990s.  At that time

         18    they were looking at Part 52 on early site permits, and had

         19    concerns about the ability of the staff to deal with those

         20    issues in environmental and siting space.

         21              At that time what we did was look at the

         22    cross-section of the organization to assure that we knew

         23    where the resources did exist within the agency.  So we do

         24    still have specialists that do have the environmental

         25    background within the agency.  And in the late 1990s, we

                                                                      55

          1    actually took an effort within NRR to reconstruct an

          2    environmental organization.  So we have an organization in

          3    NRR today, but, as Roy indicated, we do rely upon resources,

          4    predominantly the national laboratories, and have developed

          5    over time their expertise to assist us in these reviews, in

          6    developing the staff guidance, the Environmental Standard

          7    Review Plan as well.  They have participated, and we were

          8    very effective, we believe, in the conduct of our effort

          9    because of our interactions.

         10              In the upcoming years, we anticipate a significant

         11    additional load and we are expanding our resources to

         12    include more than just a single national laboratory, we are

         13    going to four national laboratories, building up for the

         14    surge of renewal applications that we anticipate.  We are

         15    looking over the hill.

         16              COMMISSIONER MERRIFIELD:  Thank you.  A final

         17    question.  Given the fact that we are early in the license

         18    renewal process, obviously, there is a balance we have to

         19    strike and that is making sure that we have sufficient

         20    resources to deal with the review of applications that are

         21    in-house, but also having resources necessary to build a

         22    regulatory infrastructure so that we have an effective,

         23    consistent review for future applications.

         24              And, so, as an overall question, I just want to

         25    make sure that we have got some comfort level about the fact

                                                                      56

          1    we are not sacrificing one to do the other.  Do we feel we

          2    have the right resources necessary to do both?

          3              MR. ZIMMERMAN:  The answer is yes.  It is not easy

          4    for us in the office to be able to maintain the aggressive

          5    schedules that we have on the plant-specific applications,

          6    as well as what it takes to do the appropriate good work on

          7    the GALL report and the SRP, but this is a very high

          8    priority for the office, and we are devoting the resources

          9    necessary to be able to do both efforts in an outstanding

         10    manner in parallel with each other.

         11              CHAIRMAN MESERVE:  Thank you.  I would like again

         12    to congratulate the staff for their work here.  It

         13    demonstrated both your capacity to really handle difficult

         14    technical issues and an ability to have a predictable

         15    process, a focused process to reach an outcome, and you are

         16    to be congratulated for having done this so well.

         17              I think that there is -- the bad news of this is

         18    that you have now created expectations.  That we wish you

         19    continued good service as we handle the rest of these.

         20              Let me turn to my colleagues for any closing

         21    statements.

         22              COMMISSIONER MERRIFIELD:  Yes, Mr. Chairman, I

         23    would like to make a closing statement.  Initially, I made

         24    comments complimenting the staff for the hard work that they

         25    did, and I want to make clear, at least from standpoint,

                                                                      57

          1    that I would have made the same comments to them

          2    irrespective of the recommendation that they would have

          3    made.  Our requirement is to weigh on this license renewal

          4    application and determine whether it is appropriate to

          5    protect the health and safety of the public.

          6              The Commission and the staff, after a significant

          7    number of stakeholder meetings, a significant inspection

          8    effort, an effort to try to move expeditiously, yet at the

          9    same time balancing out the need to answer those health and

         10    safety concerns, has come up with a document recommending

         11    that this Commission move forward on renewing this license

         12    renewal.

         13              That paper was sent to the Commission on January

         14    14th of this year.  The Commission has had some time to take

         15    a look at it.  I think the meeting today was very helpful in

         16    my review and understanding of where we should go on this,

         17    and, at least from my standpoint, given this meeting we have

         18    had today, it is my expectation that I will be voting in

         19    favor of renewing the license, or giving the staff the

         20    authorization to renew the license for Calvert Cliffs.

         21              Thank you, Mr. Chairman.

         22              CHAIRMAN MESERVE:  Thank you.  With that, we stand

         23    adjourned.

         24              [Whereupon, at 10:52 a.m., the briefing was

         25    concluded.]