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Home > Electronic Reading Room > Document Collections > Commission Documents > Commission Meetings, Slides, Transcripts, Meeting SRMs, and Full Written Explanation for Closed Meetings > 1997
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04/25/1997
1
UNITED STATES OF AMERICA
NUCLEAR REGULATORY COMMISSION
***
MEETING WITH COMMONWEALTH EDISON
ON RESPONSE TO 10 CFR 50.54 (F) LETTER
***
PUBLIC MEETING
***
Nuclear Regulatory Commission
One White Flint North
Rockville, Maryland
Friday, April 25, 1997
The Commission met in open session, pursuant to
notice, at 10:00 a.m., Shirley A. Jackson, Chairman,
presiding.
COMMISSIONERS PRESENT:
SHIRLEY A. JACKSON, Chairman of the Commission
KENNETH C. ROGERS, Commissioner
NILS J. DIAZ, Commissioner
EDWARD McGAFFIGAN, JR., Commissioner
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STAFF AND PRESENTERS SEATED AT THE COMMISSION TABLE:
JOHN C. HOYLE, Secretary
KAREN D. CYR, General Counsel
JAMES O'CONNOR, Chairman and Chief Executive
Officer, Commonwealth Edison
HAROLD KEISER, Vice President and Chief Nuclear
Operations Officer, Commonwealth Edison
SAMUEL SKINNER, President, Commonwealth Edison
L. MULLIN, Vice Chiarman, Commonwealth Edison
THOMAS MAIMAN, Executive Vice President and Chief
Nuclear Officer, Commonwealth Edison
JOSEPH CALLAN, EDO
BILL BEACH, Region III Administrator
MARC DAPAS, Branch Chief, Division of Reactor
Projects, Region III
ROY ZIMMERMAN, Associate Director for Projects,
NRR
FRANK MIRAGLIA, Deputy Director, NRR
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P R O C E E D I N G S
[10:00 a.m.]
CHAIRMAN JACKSON: Good morning, ladies and
gentlemen.
The purpose of today's meeting between the
Commission and senior executives of the Commonwealth Edison
company is to discuss Commonwealth Edison's response to the
Commission's request for information pursuant to 10 CFR
50.54(f) pertaining to safety performance at Commonwealth
Edison's nuclear stations.
The Commission also will be briefed by the staff
regarding its assessment of the Commonwealth Edison response
to the Commission's request for information.
The Commission remains concerned by the cyclic
nature of performance at several Commonwealth Edison nuclear
stations. At the January 1997 NRC senior management
meeting, the Commission placed two of Commonwealth Edison's
nuclear stations, LaSalle and Zion nuclear stations, back on
the NRC watch list. This Commission action within the
context of performance at other Commonwealth Edison nuclear
stations, raised serious questions regarding Commonwealth
Edison's ability to operate six nuclear stations while
sustaining performance improvements at each of the sites.
In order to help address these questions, the
Commission issued a formal request for information pursuant
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to 10 CFR 50.54(f). This letter requested information that
would explain why the NRC should have confidence in
Commonwealth Edison's ability to operate its nuclear
stations while sustaining performance improvements at each
site and to explain criteria that Commonwealth Edison has
established or plans to establish to measure performance in
light of the identified concerns.
By letter dated March 28, 1997, Commonwealth
Edison replied to the NRC's request for information.
Supplemental information regarding performance criteria was
submitted last week.
In order to conduct a thorough and timely review
of the Commonwealth Edison response, the NRC staff
established a multidisciplinary team consisting of senior
executive service managers and staff from Region III, the
Office of Nuclear Reactor Regulation, the Office for the
Analysis and Evaluation of Operational Data, the Office of
the General Counsel and the Office of the Executive Director
for Operation.
The Commission recognizes that there is a
significant range in performance among the Commonwealth
Edison nuclear stations. Recent events and problems, for
example, identified at the Zion and LaSalle facilities
indicate that substantial improvement is still needed.
However, the Commission also recognizes that performance at
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other Commonwealth Edison facilities such as Byron currently
is good and that Commonwealth Edison is taking actions to
meet its current performance challenges. However, the
challenge, which is to maintain the Commission's confidence
in Commonwealth Edison's ability to operate six nuclear
plants while sustaining performance improvements is
substantial.
Given the cyclical nature of poor performance at
some Commonwealth Edison nuclear stations and the apparent
inability to effectively implement long-term corrective
actions, it appears that one fundamental question needs to
be answered: What is different this time?
The Commission looks forward to the discussion
with Commonwealth Edison executives and with the staff, the
NRC staff, regarding Commonwealth Edison's response to the
50.54(f) letter.
In particular, the Commission is interested in
first understanding how the activities articulated in the
50.54(f) response will be implemented and integrated across
sites to help ensure that poor performing plants improve and
that good performing plants remain good performers. And,
second, short-term and long-term actions that Commonwealth
Edison and the NRC staff believe are necessary to preclude
continued cyclic poor performance.
I understand that copies of the presentation are
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available at the entrances to the meeting. Unless my fellow
commissioners have any opening comments, Mr. O'Connor,
please proceed.
MR. O'CONNOR: Good morning, Chairman Jackson and
Members of the Commission. My colleagues and I appreciate
the opportunity to appear before you and to respond to
questions that were raised in your letter of January 27,
1997, and most notably the questions of why should you have
confidence in our ability to operate six nuclear stations
while sustaining performance at each of our sites, what
criteria do we have to measure performance, and what actions
will we take if those performance criteria are not met.
On March 28, as you mentioned, we did submit a
detailed report that we believe is responsive to your
request. We recognize that you've only recently received
that report, and we'll try to capture the most important
points in the time that we have available today.
We do have some backup information and are willing
to discuss whatever level of detail you and the
Commissioners might desire.
Joining me at the table and participating in the
presentation this morning are Mr. Tom Maiman, executive
vice-president and chief nuclear officer, and Mr. Harry
Keiser, vice-president and chief nuclear operating officer.
Also at the table are vice-chairman Leo Mullin and president
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Sam Skinner. And among the Commonwealth Edison
representatives who are here today also attending are our
corporate vice-president and general counsel, Pamela
Strobel, our corporate vice-president, Andrew Lynch, who has
recently assumed the responsibility as chief financial
officer for nuclear operations, corporate vice-president Jay
Stephen Perry, who also serves as a site vice-president for
Dresden Station, and the remainder of our nuclear executive
team, which includes the five site vice-presidents other
than Mr. Perry. Mr. William Starr, who is the president of
Local 15 of the IBEW, is also with us today. He represents
approximately 2,500 of our nuclear workers across our six
sites, and he also represents the entire ComEd union work
force in the State of Illinois.
The presence of these individuals reflects the
company-wide support that we are providing and the
seriousness that we place on our nuclear operations.
Your letter has had a profound impact on the
company and resulted in a detailed, exhaustive, and
self-critical review of all aspects of our nuclear
operations. We've appeared before this Commission in the
past, but what we will be discussing today is quite
different. You're not going to hear much about plans or
promises. We know how important implementation and
execution are. This morning you'll hear about measurable
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actions that we have taken, results that have been achieved,
and what will be done if performance does not meet our
standards.
Our written response that was submitted to you was
intended to be as inclusive as possible in responding to
your questions. Today I want to emphasize four central
points, and these relate to the following: oversight,
assessment, and monitoring; our focus on safe operations;
the financial and human resources that we are applying; and
how we are taking advantage of our size to raise the
performance at all of our sites.
The first point I want to focus on is aggressive
assessment, oversight, and monitoring that we are providing
to our nuclear activities. The two individuals who are
seated on either side of me, Mr. Maiman and Mr. Keiser, are
charged with providing oversight in a consistent and
effective manner across each of our stations. Mr. Maiman
brings a wealth of experience in managing power production
within ComEd and a detailed knowledge of our support
systems. Mr. Keiser has substantial experience in managing
multiple nuclear stations. They will each describe changes
that we have made to ensure more aggressive oversight of our
nuclear activities.
The recent assessments that we have conducted have
been no-holds-barred initiatives designed to identify and
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surface any weakness that might impact safety or
performance. The independent self-assessment teams at both
LaSalle and Zion were comprised of senior industry experts
and augmented by the Institute of Nuclear Power Operations
personnel along with our utility peers. The scope and
critical intensity of these self-initiated evaluations are
certainly different from anything that we've ever undertaken
before at ComEd. We felt that they would deliver incisive
and hard-hitting appraisals of what was needed to achieve
sustained improvement at those two sites, and we share the
results of the ISAT in a very public and open way.
The nuclear operations committee of our board has
been strengthened and is deeply engaged in our nuclear
activities. The committee now includes all of ComEd's
senior officers, myself, along with Mr. Mullin, Mr. Skinner,
as well as the former director of the Navy's nuclear
propulsion program who had responsibility for over 100
nuclear-powered vessels, and he now serves as chairman of
our committee. He is joined by three other nondirector
members who bring a strong and independent perspective to
the committee's deliberations.
The committee operates under a formal charter
which establishes its independence and directs the committee
to provide strong oversight of nuclear performance. The
committee has its own office and a full-time engineer
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assigned to it as a liaison to the Nuclear Division.
Our safety review boards operate under a common
charter that directs them to keep the nuclear operations
committee informed of significant plant activities or
trends. Collectively I believe that these changes in
committee membership and responsibility will provide
effective oversight for the company's nuclear activities.
The committee keeps our board fully informed on progress,
and will ensure that line management is held accountable for
meeting targeted performance levels.
You requested information about the criteria that
we are using to measure performance. We selected a set of
25 indicators to track our progress. Seven of these
indicators will allow us to compare the performance of our
stations to those across the industry. We have an interim
goal that by the year 2000 we'll operate each one of our
stations better than the industry average, as determined by
these seven industry-wide indicators. This goal represents
an ambitious test of our ability to increase performance
across the entire Nuclear Division, and we've established a
range of actions to take in the event the trends indicate
that we're not moving in the right direction to reach that
goal. Mr. Keiser will discuss these indicators in more
detail in just a few moments.
Second, we've placed an uncompromising focus on
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safe nuclear operations. We recognize that operations, the
control room, and our operators are the foundation for
safety and reliability. Maintenance, engineering and
training, and the many support functions are keys to
assuring that our operators have a plant and processes which
will enable them to succeed. The operator must have the
knowledge, the skills, and the work environment to operate
the plant in an error-free manner. We have successful
models of safety and reliability at Byron and Braidwood, and
we've demonstrated improvement in operations at Dresden and
Quad Cities in recent years. The human performance of
operations has been the principal area of focus in our
turnaround efforts. Dresden and Quad Cities went through
extensive efforts to upgrade operations and improve the
standards. We simply took the time to do the job right, and
we've begun to see improvements in operational performance
at those two stations.
In August of 1994 we intensified our efforts at
Dresden by performing a critical systematic review to
determine the causes of Dresden performance problems and to
identify the means to correct them. This resulted in the
Dresden Plan, and this plan was implemented, begun in 1994
through late '96, and included actions to address the most
significant weaknesses in five key areas: management and
leadership, material condition, human performance,
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performance monitoring, and radiation protection. The fact
is safety performance has improved at Dresden. Indeed, the
NRC ISI inspectors recently recognized that Dresden had
improved, and that the control room operations are among the
very best that they had observed.
Although we completed the Dresden Plan in 1996, we
are continuing to pursue improvements through our annual
operational plans. At Quad Cities we recruited a new site
vice-president in 1994, an individual who had previously had
successful turnaround experience. We acquired additional
talent and set new standards, and Quad Cities began
implementing a three-year course of action in 1994.
Performance improvement has been achieved in many areas, as
shown by several of the station's key performance
indicators. For example, operator personnel, error-related
LER's have steadily decreased from 11 in 1993 to zero in
1996, and there has been one thus far this year. The number
of automatic scrams, while critical, has decreased from five
in 1993 to zero in 1996, and we've had none thus far in
1997.
In recent years Quad Cities has also experienced a
significant reduction in engineered safety feature
actuations. I mention these improvements not to suggest
that we've completed our work at Quad Cities or that we're
satisfied with the status quo, because we're not. But they
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do suggest, however, that we are on the right track and that
the foundation has been laid for further progress. Today we
are applying the lessons learned from Dresden and Quad
Cities to LaSalle and Zion. As before, our primary focus is
on improvement of plant operations. At Zion we implemented
a process for assessing all operations department personnel
in order to select those individuals who possess and
demonstrate the requisite high standards of performance and
professional behavior, that we are insisting upon in our
control rooms.
But beyond the operator issues, I want to
emphasize that the scope of our efforts is comprehensive and
includes material condition improvements, procedure and
process upgrades, and enhanced engineering activities.
Aggressive efforts are also underway at LaSalle.
For example, functional performance reviews are being
performed on systems that are important to safe operation to
ensure that deficiencies are identified and corrected prior
to start-up. Further, to reduce challenges to the
operators, we're reducing the number of operator
work-arounds, temporary alterations and control room
deficiencies. We are simply going to do the job right, and
we will not start LaSalle -- restart LaSalle or Zion until
we have addressed the underlying performance problems.
Third, we substantially increased the resources
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for our nuclear program. In early 1996, the board increased
the original budget of $802 million by more than $70
million, and by late last year, we increased spending an
additional $54 million, for a total of $926 million for the
year.
In fiscal 1997, we expanded the support to reach a
billion twenty-eight-million-dollar budget, a 28 percent
increase over the original budgets for 1996.
We developed this budget using a process that
included industry benchmarks and detailed reviews of the
activities at each one of our sites to determine the
resources that were needed to make the necessary
improvements. We believe that these committed dollars will
permit us to achieve improved performance at each of the
sites and we intend to apply a comparable level of resources
in 1998.
Resources include more than just dollars, they
encompass both the way that we are spending the dollars and
the personnel to ensure that we are using our resources
wisely.
As Mr. Maiman will discuss, we have assembled a
strong and experienced nuclear management team. For
example, one of the more significant changes in the staffing
of our nuclear stations in recent years has occurred in the
engineering area. Three years ago, we hired an experienced
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executive to take charge of our engineering, one who had
significant expertise in managing large-scale projects in
the commercial nuclear power industry. Under his
leadership, we substantially changed the way we perform
engineering activities at ComEd. The nuclear division is
directly providing engineering and design for our nuclear
plant rather than relying primarily on architectural
engineering firms as we have in the past.
In addition, we recruited a number of people with
strong reputations in their respective fields for the
nuclear organization. The position of chief financial
officer for nuclear operations was created to assist the
division by effectively monitoring spending. Our new CFO
has outstanding credentials and reports directly to Mr.
Maiman.
About a year ago, we assigned the top person in
our labor relations organization to work in the nuclear
division and she reports directly to Mr. Maiman on human
resource issues.
We've taken our company's chief security
administrator and made him directly responsible for nuclear
security, reporting to Mr. Keiser.
A number of specialists in supply management have
also been assigned to each of our sites to assure that the
right parts to go the right place at the right time.
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Quite simply, the message had gone out throughout
the organization that each area must recognize the
importance of nuclear operations and do whatever is
necessary to support it.
Finally, it is important to point out the efforts
we have taken to build a stronger relationship with our
union. Mr. Starr, who became the president of IBEW Local 15
within the last two years, has extensive experience at our
Byron station in the area of mechanical maintenance. He has
personally devoted a great deal of time, energy and effort
toward understanding the changes that all of us must make to
reach superior levels of performance at each of our sites.
Fourth, ComEd is fortunate to be the largest
nuclear utility in the United States. We can bring
significant resources to bear to increase the performance of
our nuclear stations. We can learn from the experiences and
challenges that we have overcome within our system and apply
these lessons learned to our improving stations.
We have experienced personnel, and we can take
advantages of the practices that have proved successful at
our successful stations, most notably Byron and Braidwood,
and these internal resources can provide us with a
significant advantage in reaching our corporate performance
goals.
It's very clear to us that ComEd will not be
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judged only by our best performing plant, but also by our
weakest. At the same time, simply upgrading the performance
of the weakest plant, if it in any way disadvantages the
performance of our other plants, would be a disservice to
the company and to the industry. We have learned from
Dresden and Quad Cities. In recent years, we've established
at those two sites strong senior management teams and
insisted on high standards, with a focus on superior
operations.
Now it is not enough simply to turn our attention
to LaSalle and Zion to bring about better performance; it is
equally important that we continue to maintain and improve
the performance of Byron and Braidwood while continuing the
trends that we have seen at Dresden and Quad Cities in the
last couple of years. The same high standards must be
embraced by all sites. Indeed, these high standards are at
the heart of our efforts to eliminate cyclical performance.
The nuclear division must be treated as an
enterprise where the entire division contributes to
improvement of the weakest station, and that will come about
through a combination of taking advantage of lessons learned
to be applied from one site to the others, through peer
reviews, and from acceptance of uniformly high standards
across the entire division.
Mr. Maiman and Mr. Keiser will now discuss the
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details of the actions we are taking to assure sustained
good performance at all of our plants.
CHAIRMAN JACKSON: Let me ask you a couple of
questions for a moment.
MR. O'CONNOR: Please.
CHAIRMAN JACKSON: And if it is more appropriate
for one of those two gentlemen to answer, that will be fine.
Given what you learned when you had the -- let's
call it assisted self-assessments done at LaSalle and Zion,
you mentioned strengthened oversight from your Board of
Directors.
Do you have plans to use independent or outside
organizations in addition to provide challenging assessments
of your nuclear operations -- a continuing plan for the
long-run?
MR. O'CONNOR: Yes, we do have at each of our
sites a management review board which is comprised of people
with expertise from around the industry or from academia who
bring great value in that area.
We presently do not have a plan to do an ISAT as
such at either Byron or Braidwood, but certainly in the
event that we saw an indication that the sort of problems
that we suspected were at Zion or LaSalle, we would not
hesitate to do the same sort of thing at any one of our
other plants.
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CHAIRMAN JACKSON: Okay, so it would be done on a
basis that would be triggered by assessment --
MR. O'CONNOR: That's correct.
CHAIRMAN JACKSON: -- that you had already made.
In your response to the 5054(f) letter, you
indicate that you'll also monitor qualitative indicators
such as employee concerns and allegations.
Have you put into place a methodology for
monitoring, evaluation, and determining the appropriate
corporate response to the qualitative indicators?
MR. O'CONNOR: We have in a way, because as I
mentioned, Chairman Jackson, we are putting as much emphasis
on attitude as we are on technical skills, particularly in
the operations area. As a consequence of that in the last
several months, as you are aware, several licenses have been
taken away from individuals who we felt might have had the
technical skills but did not have the sort of attitude that
would help us in the area of teamwork and what we felt was
required in the control room and in the operating group.
Culture is the toughest challenge we face, as we
mentioned to you last year when we appeared before you. It
is happening, however. I think there is a belief that it is
essential that everybody be part of the team, and that is in
the qualitative area, if you will, but beyond that I will
let Tom or Harry chip in and comment.
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MR. MAIMAN: We have an employee concerns program
which we call the Quality First Program. We did a survey
several months ago and determined that although that program
was in place and reasonably effective, it wasn't well-known,
and partly because of the name, so we have changed the name
to Employees Concerns, are heightening the awareness among
the employee group.
Part of what the survey showed however was that
for the most part, and there is always an outlier, that
people feel that they are able to communicate directly with
their supervisors and they do get a response.
MR. KEISER: Part of the new corrective action
program we are putting in place has a component of it where
we spend time assessing the culture at each of the
organizations and try to define our strengths and
weaknesses, and we are spending a considerable amount of
time, like Mr. O'Connor had mentioned, developing our
supervisors, making them more sensitive to the cultural
aspects of the business.
CHAIRMAN JACKSON: You mentioned the focus on safe
operations and applying lessons learned by Byron, Braidwood,
and what you have been doing at Dresden and Quad Cities to
LaSalle and Zion, and this is more of a background question
that I would like you to address as you go along and that is
how you would characterize the recent events at Zion and the
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operator performance issues at LaSalle within the context of
a focus on safe operations. Tell us how you see that.
MR. MAIMAN: I will address that in my
presentation.
CHAIRMAN JACKSON: Okay, and you mentioned having
a CFO-4 in the Nuclear Operations area. You put that into
place to ensure that all of the nuclear sites and supporting
organizations have the necessary resources to sustain
improvement?
MR. O'CONNOR: That is correct -- that, as well as
to make certain that they are spent efficiently -- so it is
a combination of both.
CHAIRMAN JACKSON: You mentioned the people, the
human resources, particularly in Engineering. How many
vacancies -- or do you have vacancies at the present time in
the corporate as well as the site engineering?
MR. O'CONNOR: We have about 100 vacancies that we
will be filling but they are mainly to substitute for
contractors that we have on the property at the present
time, and they will be replacing the contractors.
CHAIRMAN JACKSON: Okay, so you are getting -- you
are moving out, what are they? -- seconded contractors?
MR. O'CONNOR: That's correct.
CHAIRMAN JACKSON: And putting in your own people.
MR. O'CONNOR: Yes.
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CHAIRMAN JACKSON: Are there developments in your
state or region with respect to utility deregulation and
competition or movements on the part of -- what is it, the
Illinois Commerce --
MR. O'CONNOR: Illinois Commerce Commission, yes.
CHAIRMAN JACKSON: -- that will impact your
ability to carry out your plans?
MR. O'CONNOR: Not in my judgment.
There are definitely initiatives underway in
Illinois and it is likely that there will be a bill passed
this Spring session that will provide for a transition to a
deregulated environment, but notwithstanding that, we are
not going to be distracted in the operations of our nuclear
plants and we'll have the commitment to resource whatever
plants we wind up operating.
That is not to guarantee that we will always
operate 12 plants. We don't know that at this point in
time, but it is to suggest very firmly that whatever plants
we do operate will be fully resourced and will be operated
safely.
CHAIRMAN JACKSON: Will you have to go to your
Commerce Commission in the current context to get approval
for any of the initiatives or for any kind of relief?
MR. O'CONNOR: In the current context we would,
yes. In the future, depending on what the legislation is
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that is passed, that remains to be seen how it would be set
up, but we suspect that we would not then have to go to the
Commerce Commission.
CHAIRMAN JACKSON: And at this point there's been
no difficulty in that regard in terms of getting the
approvals you need or any rate relief that you might need in
order to have the resources to focus on any of these areas
that you have been outlining?
MR. O'CONNOR: In the present context that is
correct.
We have a rate freeze in effect in Illinois right
now that went in in January of 1996 and that will go for a
five year period, so our activity on rates is very modest at
the present time before the Commission and we don't
anticipate that we would be returning to them, but we also
feel that, as I mentioned, our level of resources applied
this year at the billion-plus level, which we plan again to
have in 1998, is an indication of our willingness to devote
the resources that are required for safe operations.
CHAIRMAN JACKSON: Now I realize that I believe
there is a ISO proposal being put forth within the Midwest
Regional context that I believe involves Commonwealth
Edison.
MR. O'CONNOR: It does.
CHAIRMAN JACKSON: And that would involve
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essentially then a disaggregation of the generation
facilities from the transmission, is that correct?
MR. O'CONNOR: Not necessarily. It might. In
fact, there was a meeting on this yesterday in Cincinnati
and a discussion involving a number of utilities and they
are still the formative stages of putting together an
organization that would provide overall monitoring and
oversight to how the transmission network would operate in
the Middle West, but it doesn't necessarily require at this
juncture the disaggregation.
In many respects it would function primarily as a
traffic cop, somebody who would kind of model in many
instances and then make certain that people don't do
something that they shouldn't in the way power is
transmitted across the region.
CHAIRMAN JACKSON: As things stand today, what
fraction of your net electrical generation is provided by
your nuclear facilities --
MR. O'CONNOR: 50 --
CHAIRMAN JACKSON: -- versus fossil facilities
that you have?
MR. O'CONNOR: Well, the capacity on our system is
50 percent fossil and 50 percent nuclear, but the output
historically has been between 65 and 75 percent from our
nuclear plants, because they are our base load plants.
. 25
CHAIRMAN JACKSON: And are any of the current
plans relative to industry restructuring oriented to having
the nuclear units being other than base-loaded?
MR. O'CONNOR: No.
CHAIRMAN JACKSON: They would still be, under any
of the scenarios currently --
MR. O'CONNOR: That is correct, that we would have
no intention of having them other than base-loaded.
CHAIRMAN JACKSON: Okay.
MR. O'CONNOR: Thank you.
MR. MAIMAN: Thank you.
My purpose is to tell you about how we are
managing our entire nuclear enterprise. I will discuss what
we've already done, what we are now doing and -- to assure
performance across all six sites.
CHAIRMAN JACKSON: Excuse me, Mr. Maiman.
MR. MAIMAN: Yes.
CHAIRMAN JACKSON: Let me ask Mr. O'Connor one
last question.
MR. O'CONNOR: Please.
CHAIRMAN JACKSON: You mentioned taking advantage
of your size and managing as a single enterprise, and it
turns out that one would argue that communication and
information are critical parts of an ability to do that.
Do you have a senior corporate manager designated
. 26
with responsibility in those areas with respect to
information technology and information management for either
the nuclear operations as a whole or is it a corporate-wide
--
MR. O'CONNOR: No, it's both. We have an active
information technology part of our nuclear operations, and
the best part of that is that it works very well with the
corporate IS function, Mr. Orloff, and that's been getting
an awful lot of attention from all of us seated across the
side of the table, including Messrs. Skinner and Mullin. We
have a series of meetings where we address five key support
functions for nuclear operations, and IS is one of them.
The second point on communications, they do have
an individual assigned to the nuclear operations, Mr. Ken
Ross, who is responsible for communications, and they have
communications people at each of the sites to work with them
to provide a coordinated and centralized communications
effort.
CHAIRMAN JACKSON: Could you reiterate what those
five key support functions are?
MR. O'CONNOR: Yes. The key support functions
that we've been meeting primarily on in recent months are
finance, information technology, security, human resources,
and supply management.
CHAIRMAN JACKSON: Supply management?
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MR. O'CONNOR: Yes.
CHAIRMAN JACKSON: Now, by that, you mean --
MR. O'CONNOR: Supplies and materials.
CHAIRMAN JACKSON: Materials --
MR. O'CONNOR: Correct.
CHAIRMAN JACKSON: -- across the board.
MR. O'CONNOR: Parts.
CHAIRMAN JACKSON: Okay. Very good. Thank you.
MR. O'CONNOR: Thank you, Chairman.
CHAIRMAN JACKSON: Thank you.
MR. MAIMAN: In my comments, I would like to put
the emphasis on action and results and what's different. My
discussions will follow the four areas that Mr. O'Connor
addressed: oversight and assessment, safe operations,
resources, and taking advantage of size.
Let me begin with oversight and assessment, and I
would like to focus on those tools that help us predict and
detect adverse performance and then provide the opportunity
to take action. They include the indicators that Mr. Keiser
will be discussing next.
We believe that consistent use of the oversight
and assessment tools does help to raise standards of human
performance and accountability across the sites.
First of these tools is the management team. As
Mr. O'Connor indicated, from CEO and board of directors
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through the nuclear division management, we have intensified
our senior management involvement in managing our large
nuclear enterprise.
Senior management is actively engaged in
overseeing and directing improvement. I have in place among
the best talent from both outside and within ComEd. This
team has high standards and turn-around experience. What is
different today is that the leadership team knows what
sustained improvement looks like, how to get there, and how
to intervene when adverse trends develop. We are taking
advantage of their collective experience across the entire
division. The team is in place, it is stable, and it will,
wherever possible, remain there to assure sustained
performance and continued improvement.
Next is nuclear oversight. As a result of a
division-wide assessment conducted of the oversight
function, I have increased resources and realigned the
organization. The team systematically collects, analyzes
performance data, and then provides monthly performance
trends. The division oversight team in turn assesses trends
across all sites and serves as a check and balance on the
site analysis. The results are reported to senior
management for review and action. As a result of these
actions, we have a much higher confidence in our ability to
detect degrading performance.
. 29
CHAIRMAN JACKSON: Let me ask you a question in
terms of oversight, and it relates to what you talked about,
Mr. O'Connor.
How does the board's oversight committee interface
with what Mr. Maiman is describing, and then how does that
play into the decisions that you make at the board level and
as the CEO, and in particular how does it influence these
key support areas?
MR. O'CONNOR: I think it's fair to say that the
nuclear oversight committee in recent months has become very
challenging, very intrusive, very present, both at the sites
and at the nuclear division headquarters, very demanding,
and really quite intolerant of shortcomings in performance.
And they have been there a lot of the time, a couple of days
a week, sometimes three days a week, and they have been
extremely effective --
CHAIRMAN JACKSON: What do they have the authority
to do or not do?
MR. O'CONNOR: They have the authority to just
about do anything with respect to nuclear operations, and
yet they will be the first to tell you they don't want to
manage the operations, they don't feel that that's their
role, and nor do we. But they do have vast authority in
their charter to advise, counsel and, where appropriate, to
direct.
. 30
The role that they play with our board, of course,
is to keep our board informed on their views of nuclear
performance, and I must tell you it's done in a very candid
way.
CHAIRMAN JACKSON: Do they have a specific
interface with the oversight organizations that Mr. Maiman
is describing?
MR. O'CONNOR: Yes. And Tom, you might --
MR. MAIMAN: Yes. They have a full-time
representative in our office who is the interface with them
when they're not there, of course, and also with Ron
Muldinger, who is my oversight manager for the division.
MR. KEISER: And they're tied to the SRBs.
MR. MAIMAN: Yes.
MR. O'CONNOR: As Mr. Keiser just said, they have
a very close tie and have recently proposed, which has been
accepted, a common charter of operations which has been
adopted by the safety review boards at each of the sites.
So they are in regular communication with them as well.
CHAIRMAN JACKSON: So the safety review boards at
each site have a common charter; is that the message here?
MR. O'CONNOR: Yes.
MR. MAIMAN: And that common charter was put
together through the board committee.
CHAIRMAN JACKSON: Okay. Thank you.
. 31
MR. MAIMAN: Next I would like to talk about
assessments. We are continuing an open and critical
approach to self-assessments like those conducted at LaSalle
and Zion. For example, we recently completed a critical
evaluation of the operational event that took place at Zion
and have shared the results with the NRC.
To make our assessments rigorous, we often compare
our performance against the best performing plants in the
industry. Identified site problems receive the necessary
visibility to ensure effective correction at all sites.
Next is the event-free clock. All sites have
adopted use of an indicator called the event-free clock.
Although it is not one of the selected division performance
indicators, we consider it quite useful. It tells us how
well we are doing in preventing events involving deficient
human performance. The number of event-free days is
measured and the results are conspicuously posted. Trending
helps to make it a predictive indicator and to keep us
focused on the importance of human performance in achieving
safe and reliable operation.
CHAIRMAN JACKSON: Mr. Maiman, why is it not a
division indicator?
MR. MAIMAN: We use this as a lower level, real
time indicator that's available to personnel as they enter
the station. So it's a living -- it tends to be more of a
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short-term thing.
CHAIRMAN JACKSON: Okay.
MR. MAIMAN: But over time, it certainly can be of
benefit in correcting the human performance deficiencies.
MR. KEISER: We track the event-free clock on a
division-wide total daily, so we know what the total
consecutive days without an event has been at -- if you
total up the entire ComEd system.
CHAIRMAN JACKSON: Now are these focusing on
events that are strictly rooted in human performance?
MR. MAIMAN: Yes.
CHAIRMAN JACKSON: Okay.
MR. MAIMAN: Yes.
COMMISSIONER ROGERS: Just before you leave this
slide, I wonder if you could just mention what you have in
place to review root cause analyses, not root cause analyses
themselves but what do you have in place to review whatever
root cause analyses have already been done, because it has
been my experience in the past that very often it takes time
to really get at the real root cause of some of the problems
that have already been assessed on a root cause basis,
particularly for an LER and I wonder what you have to really
try to go over those reviews, those analyses and review them
to make sure you are really comfortable with having gotten
at the real root cause or causes.
. 33
MR. MAIMAN: Yes, that is a difficult situation.
I will address that in a few minutes in our corrective
action program. But, in fact, we are doing that.
CHAIRMAN JACKSON: Why don't we wait for that.
MR. MAIMAN: Turning now to safe operations, we
are placing strong emphasis on strengthening control of
operations and improving human performance across all the
sites and I would like to highlight some of the major
actions we have taken to accelerate the pace of improvement.
First, a nuclear operations information display
center has been established in the division office. The
center provides a structured and formal presentation of
up-to-date information to senior division management and to
the office of the nuclear committee of the board. Current
information is displayed on performance measures, plant
status, LCO entries and other data. We use this information
in the timely oversight command and management of the
nuclear enterprise.
Next is control room monitoring. I have directed
the site vice presidents and selected division vice
presidents, nine in all, to spend time each month performing
cross-site control room monitoring. This is one way that we
are using senior management experience across all the sites.
It also gives each site vice president a first hand
opportunity to judge his own control room's performance
. 34
against the others. They go to a different site each month
and use standard check lists covering such matters as
command and control, procedure use, three-way communications
and shift turnovers. A monthly reporting cycle has been
established and results trending will follow. I will be
immediately notified of important adverse findings or
trends.
The operations peer group will also review this
information and take action as appropriate. These actions
serve to reinforce the importance of formality and strict
adherence to command and control principles in the control
room.
CHAIRMAN JACKSON: Now, will you talk to the
Commission about the Zion events and the operator
performance at LaSalle within the context of what you have
done and how you -- why you feel that what you are
describing speaks to what those events and those situations
show?
MR. MAIMAN: I will do that next.
CHAIRMAN JACKSON: Okay.
MR. MAIMAN: Next is oversight plant evolutions.
To do this, we are using the operations center and the other
oversight mechanisms, such as Mr. Keiser's six-site monthly
management review meetings. A leading example would be the
restart readiness plans for both LaSalle and Zion.
. 35
In that regard, we have slowed the rate of restart
plan implementation at both sites and are extending the
schedule for return to service of these units. This change
does effect some of the actions described in our 50.54(f)
response relating to LaSalle and we will provide updated
information. Our new schedules will allow us to, one, more
carefully and deliberately manage work activities; two, to
structure the application of our resources and; three, take
the time to do it right.
We would have been trying to crowd a lot of work
into a very short time. The senior management team and I
will make sure that we have strong human performance and
are, indeed, ready for safe, reliable operations.
Additionally, I will have a formal restart readiness
assessment conducted at each site. As the responsible
officer, I will not authorize a site vice president to
restart unless I have the confidence that the plant is ready
to proceed with a safe, deliberate and disciplined startup.
Next is the operations standards which you asked
about.
Following the LaSalle and Zion events, we
performed special assessments of the operations at the other
four sites. This confirmed the need to formalize common
standards across all the sites. I have issued new
operations directives that define practices for approaching
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LCOs, withdrawing rods, supervisory oversight and other
essential practices for disciplined control room operations.
For example, I have directed that operators may
withdraw rods only in the immediate presence and with the
specific direction of the unit supervisor. I have directed
that each license holder have a face-to-face discussion with
the site vice president, the plant manager or the operations
manager to specifically review the Zion reactivity event and
the newly issued operations directives.
This action is intended to test operator
understanding and enhance control room formality and
discipline. Additionally and in direct response to the Zion
and LaSalle events, specific training has been implemented
to improve operator performance in areas of apparent and
demonstrated weakness.
Does that answer your question, or would you
like --
CHAIRMAN JACKSON: Well, it would just be easier
if you just said these events shows us these problems, and
this is what we're doing and why we think it's addressing
the problem.
MR. MAIMAN: These events did show some pretty
clear problems. At LaSalle it was our work control process,
and I will address that in a few minutes. At Zion it was
command and control. At LaSalle it was command and control.
. 37
At Zion it was ineffective corrective action. And at both
plants it in fact was operator skills and knowledge to some
degree.
What we have done -- I talked about the things to
improve command and control in the control room. We have
instituted aggressive training specifically for the
knowledge and skills and for the corrective action program,
I will talk about what we're doing in that in just a minute.
Let me now address resources. Mr. O'Connor noted
that we have substantially increased the applied resources.
Equally important are the steps taken to ensure that the
increased resources get results. We have put in place an
improved business planning process tied to the budget
process. The resulting plans defined the improvement
actions to be implemented in the coming year. These plans
also include specific schedules and goals to help gauge
progress and measure resource effectiveness.
This is a simple concept, but indeed it has been
difficult to effectively put in place across our six sites.
We are beginning monthly line-item spending
reviews for each site. The review meetings include the site
vice-president, the site financial controller, Mr. Keiser,
the chief nuclear operating officer, Mr. Lynch, our new
chief nuclear financial officer, and myself. This process
provides a further mechanism for senior management to
. 38
measure resource effectiveness and sufficiency. The
extended schedules for restarts of the LaSalle and Zion
units are examples of the kinds of actions we are taking to
ensure that resources are adequately and effectively
applied. Each site does have adequate resources. However,
the slower pace of the restart plans reflects a reasoned and
reasonable decision regarding resource application.
I'd now like to address taking advantage of size.
ComEd is a substantial company with opportunities for taking
advantage of its size. We have the responsibility and the
flexibility of 12 units, along with the ability to marshal
resources. Used properly, this is a great strength. Taking
advantage of size is both a business and a performance
imperative. We are therefore acting to capitalize on this
strength. As examples I would like to tell you about our
peer groups. Peer groups are teams led by a site or
corporate vice-president with members from each of the six
sites and a seventh permanent member from the division. The
teams were established in 1996. They are empowered to
develop and assist in implementing across the sites the best
practices that we can find within the division and the
industry. The output of the peer groups provides the basis
for setting division-wide policies, standards, and
practices. Peer groups provide a powerful forcing function
for raising standards and improving performance across the
. 39
sites. They are also a valuable resource for quickly
receiving, defining, and disseminating lessons learned.
Among the peer group initiatives are these. First, we have
developed a division-wide standard corrective-action
program. This program includes standard root-cause training
for groups of individuals at each site and in the division
offices. We have established common cause-coding systems
for the whole division. The benefit is a much-strengthened
ability to analyze problems consistently at all sites, to
identify common problems and trends, and to fix what is
broken. The new corrective-action process is currently in
place at Byron and Dresden, and will be in use at all sites
by year-end. Other peer-group efforts are under way to
raise standards and develop best practices for work control,
training, maintenance, and surveillance, configuration
control, and operations. We know that the peer-group
process is effective because it is a well-proven technique
used in industry. We intend to have additional process
improvements implemented by the end of this year. Two of
these involve out-of-service and work control. A common
out-of-service or tag-out process will, among other
benefits, allow us to move people from site to site without
retraining. This process, which is electronically tied into
our work control system, has been developed and tested. It
is scheduled to be implemented at five sites in June, and I
. 40
expect it to be in use at all sites by year-end.
A standard work-control process has been developed
to ensure proper review and authorization of work items.
This process will strengthen our ability to plan, schedule,
and execute work in a controlled and efficient manner. The
prototype process has been implemented at Braidwood and is
now being tested. The finished product will be implemented
at all sites this year. These and other peer-group efforts
are under way. In all there are nine peer groups, and more
than 30 initiatives. All are aimed at producing common site
processes based on best practices and achieving performance
benefits derived from ComEd Nuclear's large size.
I now turn to engineering. Engineering is clearly
an area where our size can help. The movement of
engineering capability in-house began in 1994. It is a
major step on the road to technical self-sufficiency. We
have established a common set of engineering initiatives
applicable to all sites, and currently have over 800 ComEd
engineers employed. As outlined in my November and January
letters to the NRC, we have made major commitments to the
conduct of functional inspections and design basis
verifications at all sites.
A significant change that has strengthened the
in-process quality of our engineering work is the
establishment of engineering assurance groups at each site.
. 41
This effort takes time and requires more work, but it is
also significantly enhancing the quality of the final
engineering packages. It is the right thing to do.
To recap my remarks, let me emphasize that we are
acting to bring around sustained improvement through
markedly better human performance and personal
accountability. We have a strong management team and the
right mechanisms in place to help detect problems and
provide the opportunity to take action. We have conducted
critical assessments of our performance, and are placing
heavy emphasis on control and oversight of operations. We
have put in place a business planning process --
CHAIRMAN JACKSON: Let me stop you.
MR. MAIMAN: Yes.
CHAIRMAN JACKSON: Before you go. You mentioned
the peer groups, and you have the number of areas outlined,
including corrective action. As you know, I visited LaSalle
last month, and at that time I was told and noted that there
were failings in the corrective action program, and so much
so that at that point as it was expressed to me that to some
extent employees had lost confidence and were not
identifying problems. And you've described various issues
and things that you've put into place such as the
division-wide standard corrective action program and
common-cause coding. I guess the real question for me is,
. 42
can you give us a brief delineation of what the failings are
or were in the corrective-action program, and how what
you've described is meant to address those problems, and how
you will know that you've been effective in doing so?
MR. MAIMAN: The failings of the implementation of
past corrective action are many. They begin with, in some
cases, ineffective root cause analysis, fixing the symptoms
instead of really going after the root cause.
I think the other part of the corrective action
program that has been difficult is each site did it somewhat
differently. One of the values of the peer groups is to get
the sites together with an empowered member who can make
decisions for the site and then go back to the site with the
consensus agreed-to new corrective action plan, and it does
include root-cause-trained people, groups at each site, it
does include this common cause coding, and it does include
the consistent application of a proceduralized corrective
action program that is the same across all sites.
CHAIRMAN JACKSON: Okay. But is proceduralization
your metric for success?
MR. MAIMAN: No. It can't be, but you have to
start with a plan, you have to start with a process, you
have to start with --
CHAIRMAN JACKSON: That's how you go along the
path.
. 43
MR. MAIMAN: Yes.
CHAIRMAN JACKSON: But what is your metric or what
are your metrics for success? How will you judge that
you've been effective?
MR. MAIMAN: We have several metrics. Just to
repeat some of the items that Tom was talking about, some of
the failings of the system were lack of accountability. So
the process has built into it now accountability. There are
metrics, that we can see it. We're looking at the metrics
-- are they being written, in a sense who are they being
written by, not by the individual, but is engineering
writing them, is maintenance writing them, or are they not
writing them? So our metrics allow identification of the
utilization of this system by classification, if you will.
There was a lack of belief in the system on the
employees' part which doubles back to the lack of training
and understanding what is the corrective action program all
about? Is it a punitive system or is it a system that's
really put in place so we can significantly improve the
performance of the system? And so these training programs
we're putting on come at those particular issues.
To respond to Commissioner Rogers' question
earlier, it's not so much the identification of the problem;
now one must get to the root cause. So we're effecting a
significant amount of training, common training across the
. 44
sites so that we get better root cause analysis, if you
will.
Having come up with the root cause analysis,
there's a presentation to management at each of the sites
trying to align and make sure that the cause, if you will,
is indicative of the event and not it's a training error or
something like that. I mean, it is a challenging dialogue
that takes place at the sites looking at the root cause
evaluation, looking at the actions taken to prevent
recurrence. Do they match what you said the root cause was,
if you will.
Then we have indicators that deal with repeat
events. That is to say, having implemented the root cause
over a 24-month period of time, we're looking back and
seeing do we have repeat events, and that's a measurement of
the effectiveness, if you will, of the action taken, and
then in the meantime, there are also effectiveness reviews
by the what we refer to as our RSQV organization.
CHAIRMAN JACKSON: Okay. Because that's what I
wanted to hear, because you can put the programs into place,
but if you have repetitive problems, if you have
equipment-induced transients or events, if you find that the
fixes are only partial fixes and, therefore, that goes back
to Commissioner Rogers' comments that you haven't done
adequate root cause to understand what your problem is.
. 45
That's when I meant when I say a metric.
MR. MAIMAN: Sure.
CHAIRMAN JACKSON: What's your metric for knowing
that you've fixed the problem. The metric is not -- and I
know you're describing what you're doing --
MR. MAIMAN: Yes.
CHAIRMAN JACKSON: -- to fix the problem, but the
issue is how do you know when you've fixed the problem.
MR. MAIMAN: And there are a number of metrics:
failed surveillances, rework and repeat events.
CHAIRMAN JACKSON: Okay.
MR. MAIMAN: We have put in place a business
planning process to assure continued spending at the right
levels for the right things. We are taking advantage of
size by capturing the best practices and processes from the
sites in the industry and then applying them at all sites,
and the peer group process, as we discussed, is a powerful
forcing function to do this.
In sum, I am convinced that we have the right
combination of people, resources, and actions to sustain
performance at all sites. I do not want to leave the
impression that any of us think that managing our
twelve-unit enterprise is easy. It is not. We have a tough
challenge ahead, but we can do the job and we will do it.
The last segment of our presentation will address
. 46
how we expect to measure performance, hold ourselves
accountable, and take appropriate actions; and I will direct
your attention to Mr. Keiser for that discussion.
MR. KEISER: Thank you.
Good morning. As Mr. Maiman noted, I am pleased
to have the opportunity to discuss performance indicators
and the central role they have in managing the nuclear
division at each of our sites.
Performance indicators are fundamentally important
to our improvement efforts. My personal belief is that in
order to change performance, you must measure the
performance, set a performance standard, and then hold
people accountable to meet that performance standard.
Indicators are useful to both detect and
anticipate where problems may be developing so that
management can prioritize attention and resources to that
area. There is an old saying that what management measures
gets done, so it is very important that we measure the right
parameters and use indicators carefully.
Obviously performance indicators are not new to
Commonwealth Edison. What has changed is how we are using
them to achieve accountability. We now have a formal
management process for evaluating and responding to the
indicators and a process to obtain uniform indicators across
the six sites.
. 47
Last year, we initiated efforts to develop a
better set of indicators and a process for using them. Your
50.54(f) letter has caused us to accelerate those efforts.
The entire Commonwealth Edison senior management team has
carefully reviewed and rethought our indicators to ensure
that they provide us the information we need to successfully
manage or nuclear program.
We have made many changes. Today, we are actively
using indicators to achieve accountability. We are using
consistent indicators to communicate from the lowest levels
of the organization all the way up to the board of
directors. This allows the whole nuclear organization to
have a common understanding of standards of performance,
expectations and what is important.
This common set of indicators we have selected is
based upon industry experience and the experience of our
management team. These indicators have been reviewed and
agreed to by all our sites, the nuclear division and our
corporate offices. Overall, they paint a picture of a good
plan. That is to say if we meet our performance criteria
for the indicators, we know we will have a safe, reliable,
well running plant.
But performance indicators are just a tool and
thus have limitations. Consequently, we are using them
carefully in conjunction with analysis and our other
. 48
performance monitoring tools in order to determine our
performance. There are several features of our indicated
process that provide confidence that our indicators will
help us sustain the performance improvements at all our
sites.
First, the indicated parameters ought to be
measured consistently across each site. We will compare
apples to apples and not apples to oranges. Whether it is
for a Department Manager or the Nuclear Committee of the
Board, we'll be using and comparing consistent information.
This philosophy of consistency in all we do is
something that Mr. Maiman and I are trying to implement
throughout the Nuclear Division. We have struggled with
this in the past. We are not consistent yet but these
indicators are a giant step forward.
This approach of consistency allows our senior
management and Board oversight to be much more meaningful.
Second, our indicators make clear how well we are
doing compared to our peers and our goals. We have two
subset of indicators. One utilizes existing standard NRC or
standard WANO indicators and will allow us to compare our
performance against that of the industry.
The second subset consists of Commonwealth Edison
internally-developed indicators that we will use to compare
our six nuclear stations against each other. The standard
. 49
NRC and WANO indicators will directly tell us whether we are
on track to meet our overall goals. These indicators will
not allow us to fool ourselves about how well we are really
performing.
Third, we know that having indicators alone is not
enough. To ensure good performance, they must be properly
used. We have structured our management process to take
maximum advantage of the information these indicators give
us.
Senior Nuclear Division and site executives are
directly involved in conducting a formal review and analysis
of these indicators each month. In addition, the Nuclear
Committee of the Board will receive these indicators.
This monthly review is done on both a
division-wide and a site-wide basis. On a division-wide
basis, the site vice presidents, the other vice presidents
and I, hold a senior leadership meeting to assess both
individual site performance and division performance.
During these meetings we review our performance indicators
in conjunction with review of events, violations and
assessment results to identify early indications of
declining performance.
We also assessed the indicators and performance as
a whole to see if any broader trends are emerging. This
forum allows the senior management team to identify emerging
. 50
weaknesses and common problems and to work on common
solutions.
We also have a site-specific process. Each month
I conduct formal management review meetings at each site.
During these meetings we cover site performance measures,
events, assessment results, accomplishments and plans.
Through these meetings I maintain strong oversight
and direction of each nuclear station.
Finally, as I will discuss in a moment, we have
established a formal process for responsive action in cases
where our performance criteria are not met. This structure
and formality ensures that when something significant
develops it gets proper attention and prioritization. This
is an important change for the organization.
The indicators are not just developed and
monitored by the site, thus leaving the site to hold itself
accountable for its performance. Senior Nuclear Division
management is intrusive in challenging, helping, and
improving the performance of the units.
In the 5054(f) letter you asked us to define the
action we would propose to take in the event that our
performance criteria are not met. We have established a
formal process for this and our process is defined by a
procedure we issued earlier this month and specifies the
reporting evaluation and definition of actions that we will
. 51
undertake whenever we fail to meet a criterion.
Each of the site vice presidents currently
provides me with a monthly letter identifying their issues
of concern. Beginning in May this letter will be modified
to also provide me with the status of the station's
performance indicators including identifying and explaining
performance variances from our established criteria. This
would be Step One of the process.
Step Two of the process occurs at the site monthly
management review meeting. Here the reason for the variance
will be discussed along with the responsive action and
future expectations for performance.
If the indicator continues in variance for a
second month we enter Step Three. The site must submit a
detailed action plan that will correct the performance
trend. This plan will be reviewed at the site monthly
management review meeting and discussed at the Division
Senior Leadership Meeting.
If the variance continues for a third month, a
team will be assembled consisting of personnel from the
affected site as well as others. This team reporting
directly to me will assess the causes and provide
recommendations to correct performance.
Taken together, these steps ensure that problems
are promptly reported and analyzed and we take strong and
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prompt action whenever our indicators tell us that
performance is moving in the wrong direction. This process
will keep us on track to meet our performance goals.
In summary, as I told you at the start of my talk,
my personal philosophy is that in order to change
performance you must measure that performance, set
performance standards, and then hold people accountable to
meet those performance standards. The indicators and the
management processes we are using are a cornerstone in our
efforts to improve performance at all our nuclear plants.
Our indicators are consistent. They are carefully
reviewed and formally responded to. They provide additional
confidence that we will get results and we will safely
operate our six nuclear units while sustaining performance
improvements at each of the sites. Thank you.
CHAIRMAN JACKSON: Let me ask you a couple of
questions. This has to do with your structure and use of
indicators.
In your response you talk about performance
criteria and you talk about goals. What is the difference?
MR. KEISER: We have established goals for each of
the sites for each of the matrix performance we want to meet
at the end of the year. They are challenging goals. That
means that we may or may not meet all of them.
Our expectations aren't to meet all of them.
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With respect to that goals, we have both monthly
and yearly indicators we are looking at and if there is a
variance that occurs, we want the variance described and
explained to the organization.
Some of the goals may need to be changed because
they weren't set properly or events unfold that would
prevent us from meeting them.
CHAIRMAN JACKSON: I guess I am asking what is the
difference between performance criteria and goals. They are
one and the same in this context?
Let me give you an example. You had criteria for
safety system performance. You have a criterion,
"unavailability exceeds two times the industry goal for any
system"
MR. KEISER: Right.
CHAIRMAN JACKSON: First of all, I am interested
in what the rationale is in terms of how you went about
establishing the various criteria.
Are these industry benchmarks? Are they what
other nuclear organizations have used? How do you arrive at
these?
MR. KEISER: We arrived at them using our
collective judgments -- that is to say, the organizations,
the site vice presidents, their quality organizations, et
cetera, in looking at performance indicators they have found
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useful in the past.
Each of the sites themselves had performance
indicators before we embarked on this common set of
indicators to measure Department performance, and so we
collectively looked at what would be the best of each,
right? -- and made a determination of what would a good
performing plant look like.
That is why the parameters cover maintenance,
engineering, operations, et cetera.
We set goals out, and you are quite correct, some
of the goals are the industry goals for performance in the
future and around that goal we established the performance
criteria, which is to say we think that the parameter is
trending in the wrong direction if it falls outside of our
performance criteria.
That is just a flag to management to go take a
further detailed look at what is going on. Obviously, when
one sets the criteria for scrams of one automatic scram per
year at a station, we, having 12 stations, I would
anticipate having one scram a year if you will.
What we need to do is find out the reason for the
scram and take prompt corrective action so that in some
cases the goal meets the performance criteria that we expect
to achieve.
CHAIRMAN JACKSON: I am interested in hearing a
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little bit more about what you are doing with your people.
You started with the assessment, assessments that you were
doing at Zion. There are some activities at LaSalle. I
think it is important that the Commission hear from you and
understand it because, in the many ways, what you have
talked about so far is a plan and you have kind of laid out
some things up here, your performance indicators and all the
new managers you brought in, et cetera.
I am sure you have seen and read enough about the
way I tend to look at things that it is good that you have
the right people at these high levels. But in the end it is
your work force that is going to make or break what happens
at these plants. And so I think it is important for the
Commission to hear and understand more about what you are
doing with the work force beginning with, you know, what you
have been doing at Zion, what you are doing at LaSalle, what
your plans are relative to your other stations, how this
plays into what is going on.
I don't know, whoever would like to speak to this.
MR. MAIMAN: Let me start by just saying a lot of
it is about changing culture and, as you can imagine, there
is slightly different culture at each one of the plants and
so there are different levels of intenseness in that culture
change that we are dealing with.
This is not an easy thing to do and it generally
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takes a long period of time to be truly effective in it.
But we are, in fact, making progress. We have instituted
some specific training courses such as the mark training,
which --
CHAIRMAN JACKSON: I guess what I wanted to know,
tell us about the assessment you are making of people at
Zion. Give us a little more detail and then tell us what
you are doing at LaSalle and tell us how this propagates
across the other sites.
MR. MAIMAN: The assessments at Zion was a very
aggressive move on our part that we informed Bill Starr and
the local 15 people about what we were going to do. But
after the event that took place up at Zion and given the
longstanding history about concerns about control room
demeanor and command and control and so forth, we undertook
an assessment of all of our 180 operating personnel within
the plant. Given that perhaps there are some of us in life
that are just plain not meant to be operators and so forth
and so on, but we also wanted to test the knowledge and
skill level.
We went through this assessment. It was a very
detailed assessment. We brought in an outside consulting
HR, human resources firm to help us put this kind of
assessment together. I had participated in this kind of
assessment in the commercial division and also in our fossil
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division and so I was familiar with this process.
We went through the assessment and made a judgment
that a number of people were not fully prepared to perform
their operating responsibilities. Fifteen of those people
will be remediated. They are good, capable people and we
are going to put them through mediation courses.
Four of those people, it was determined through
the assessment, should not really be in the operating
department, yet they were good employees. So they will be
retrained and offered other positions within the plant.
Eight of those people it was determined should not
be at Zion station, have been assigned elsewhere outside of
the plant. This is a dramatic move for the company to
undertake. It does violate some of the labor agreements
that we have and although we do not have full agreement with
our labor union as to what we are doing, we are talking and
we are resolving the difficulties.
At LaSalle, we have taken a slightly different
approach. We are, in fact, going through the operators in a
testing way to find out where the deficiencies are and what
we have to do and we are running some of the people through
retraining programs and some will no longer be in the
operating department. But, again, this is a very aggressive
process that we have instituted this year and if it needs to
be applied at the other sites, we will do that.
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MR. KEISER: As a matter of fact, we need to raise
the performance level, raise the performance standard for
all 6,000 nuclear employees within the Commonwealth Edison
system and we are setting out to put in place the
development process to improve that performance. Part and
parcel of it is the training department. We are
strengthening the training departments at each of the sites
and at corporate to raise the level of our mechanical skills
and operator skills and managerial skills.
Each of our first line supervisors is being put
through a management development process. We have done some
assessments of our managers, identified common weaknesses,
if you will, or areas where we want to focus --
CHAIRMAN JACKSON: This is across the nuclear
enterprise?
MR. KEISER: This is across the nuclear
enterprise.
We have identified what competencies we think are
most important to us that we need to act upon and so we have
developed two two-day sessions of training for all the
supervisors. It may take us two years to get through it
because there are over 600 supervisors involved. Part of
the process is an assessment center on the individuals'
competencies. We utilize that assessment center to feed
back to the employee and the employees' supervisors, here
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are your strengths, here are your weaknesses, put in place a
development program.
It is possible that all of our supervisors may not
want to be supervisors in the future, may not have those
skills. That's fine. We've got a lot of work that needs to
be done.
So we are out training the first line supervisors.
Our initial first line supervisors, we have changed the
selection process. It consists of a formal assessment
center, consists of four weeks of training paced over time
so you train, go to work, train, go to work, to implement
some of the techniques. We have changed the selection
process through our promotional sequence so it is referred
to as a targeted selection interview process so there is
more than one input to the selection of an individual for
promotion.
So we are hard at work developing all of our
employees and focusing on our managerial skills. We are
changing the environment, developing reward and recognition
programs so we reward individuals and teams for their
superior performance. We have changed the compensation
structure so, again, we can reward and recognize our highest
performing individuals. So it is not -- the way we see it,
LaSalle and Dresden are some quick action to, if you will,
make a step change in performance in those areas. But we
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are addressing the performance level across all the six
sites uniformly.
CHAIRMAN JACKSON: Why not have step
change assessments on the operational side or other parts of
the organization at the other sites, particularly at Dresden
and Quad Cities?
MR. MAIMAN: Dresden has --
MR. KEISER: They have done that. That has taken
place. They have kind of shown us the way at the rest of
the plants. I mean, in essence, that is the model of both
Steve and Mr. Perry and Mr. Kraft in their turnaround at the
Quad Cities and Dresden station, right, focus on operations
and assessment of the capabilities. It is raising the
performance standing but it is raising the training so the
individuals can --
CHAIRMAN JACKSON: So you are basically saying you
are taking that and propagating it across. It takes
slightly different form depending on what you see at the
different plants; is that what you are telling us?
MR. MAIMAN: Exactly. And it is really important
to understand that the long term effort applies to all six
but the short, aggressive efforts are focused actions.
MR. O'CONNOR: I just might add, there is a lot of
communication between the senior management of nuclear and
the leadership of the union. Mr. Keiser meets every other
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week with Mr. Starr and his team and a joint leadership
group. That communication has helped immensely, I think, in
understanding what is required to get to the levels that we
need to get to, has been very helpful.
CHAIRMAN JACKSON: Mr. O'Connor did you have some
summary remarks?
MR. O'CONNOR: Yes, thank you, Chairman.
The fundamental purpose for us being here today is
to provide you with the information that you have requested,
information that hopefully will give you confidence in our
ability to operate each of our sites with sustained
performance improvement. Before you are representatives
from across our entire corporation who are committed to
restoring your confidence, as well as the confidence of our
customers and our shareholders.
We do understand accountability and have strong
reasons to believe that we are prepared to meet our
obligations. First, we clearly know where our plants stand
today. Byron and Braidwood by most measures have
consistently demonstrated overall good performance. Dresden
and Quad Cities have shown steady improvement over the last
couple of years. We do understand the depth of the issues
at both LaSalle and Zion as a result of the unprecedented
independent self-assessments we conducted.
More than ever before, we know what our current
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performance issues are and we have put in place standards
that will be applied across all of our sites. As Mr. Maiman
and Mr. Keiser have stated, we have established formal
oversight structures that will provide us with the
measurements needed for effective oversight and
accountability.
Our performance tracking systems will give us
early indications of weakness and we have a process that
will trigger formal actions if we see any adverse trends
surface.
The Nuclear Operations Committee and senior ComEd
management are highly involved in the oversight of nuclear
activities and there is a clearly defined process for the
reporting and monitoring of performance indicators. We
intend to continue to conduct aggressive self-assessments of
our performance. Last, and this goes to a point that you
mentioned and most important are our people. We are
providing the best talent available for key positions of
leadership for the division, whether they come from within
the company or from outside. Our people are demonstrating a
willingness and an ability to learn and to implement new
approaches to managing our plants.
Throughout all levels of operations, we are
focused on improving the work practices and the working
environment so that our employees can concentrate on safe
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operations and I am confident that our people at each one of
our stations will perform at increasingly higher levels.
I would like to close, and Mr. Maiman has already
mentioned this, that we are operating in a very demanding
and challenging period. In the past, the pace and
consistency of our improvement efforts has not always been
what we intended or expected. No doubt that there will be
more challenges as we move forward but we are determined to
succeed.
Our entire industry is going through the greatest
change that it has ever seen in its history. I can assure
you that these changes will not distract us from the focus
we have placed on safe nuclear operations.
As I sit before you today, I firmly believe that
we are doing the right things to produce the results that we
need and that you, we and the public expect.
Thank you very much.
CHAIRMAN JACKSON: Thank you, Mr. O'Connor. I
have one follow-up question for you.
Can you tell the Commission a little about your
recent decision with respect to the early closing of the
Zion station? What impact that is having on your overall
corporate planning, your resource expenditure at the site
and on your work force, the impact on your work force?
MR. O'CONNOR: First, it was an economic decision
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alone. We looked forward to determine whether or not by
extending the life to the year 2013 there was an economic
advantage to doing so and we decided that beyond the year
2005 that it was not there. And we have been very faithful,
I believe, with our employees of pointing out to them that
we would have to justify our assets going forward.
We had a similar situation with two of our fossil
plants that we recently sold. So our employees clearly, you
know, don't like the fact that we may be shortening the life
of that plant but they, hopefully, are beginning to
understand why we did what we did in canceling those steam
generators.
The steam generators represented an expenditure of
$400 million off into the future. It was not in the budget
for this year, for that plant. So the only question was
whether or not we would make the commitment going forward
now which we had to do by April 30 to determine whether
those steam generators should be completed. We decided that
was kind of the drop dead date for us. We decided not to do
that.
In talking to Mr. Muller who was the site vice
president and to Mr. Maiman who did an all-hands review on
four separate -- an all-day session with all the employees
at Zion station, the mood is clearly very somber. People
had expected that that plant would be there for a longer
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period than it is going to be. But, in talking to
Mr. Muller very recently, he indicates to me that the
employees accept the fact that the life of that plant may be
shortened and that they are going to do the very best that
they can to operate it as well as they can. But, clearly,
it was a shock to them.
CHAIRMAN JACKSON: In terms of your corporate
planning and resource expenditure, is this changing any of
your -- I mean, how does this affect what other capital
improvements, material condition, changes, et cetera, that
you might --
MR. O'CONNOR: Nothing. It will have at the
present time no impact whatsoever on any of the other
proposed capital expenditures that we have.
CHAIRMAN JACKSON: Commissioner Rogers.
COMMISSIONER ROGERS: I would like to just go back
to the advantages-of-size slide, the two bullets on there
having to do with peer groups and engineering. I have a
couple of questions, maybe the engineering first.
How many engineers do you have at each site? You
mentioned 800 engineers. How are they deployed, how many at
corporate headquarters versus how many are onsite? And you
have engineering assurance groups at each site, and how
large are they?
MR. KEISER: First let me address the number at
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each site. We're around 120 or so in the division, and the
rest are spread almost equally among the sites.
I need to tell you, though, that our full
complement of engineering people is about 1,500; 800 of
those are Commonwealth Edison employees; we're going to
about 900. The other 700 are brought in on temporary basis.
Number 1, we have the design-basis effort that we're working
on over the next couple of years. Number 2, we have these
assurance groups that we put in place. Number 3, and this
is a big one, we have the steam generator replacement effort
for Byron and Braidwood. So those require short-term but
large numbers of engineers.
COMMISSIONER ROGERS: The assurance groups at each
site, how many engineers are there in each of those groups
for those sites?
MR. MAIMAN: Do you know, Harry? It's about four?
MR. KEISER: About three.
COMMISSIONER ROGERS: About three people?
MR. MAIMAN: Right, full-time equivalent, yes.
COMMISSIONER ROGERS: The peer groups, I have a
couple of questions there. You mentioned you have nine
teams.
MR. MAIMAN: Yes.
COMMISSIONER ROGERS: What was the basis for
defining those teams to be nine? I mean, what are they,
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roughly? What do they cover.
MR. O'CONNOR: If we could have slide L-1, please?
MR. MAIMAN: Those are the peer groups that we
have in place. The focus of the peer groups is to provide
the common processes that we talked about. If we truly --
let me back up. I do have, I believe, the best people in
the industry running these plants, and if I just sent them
off, I have no doubt that they would be able to make each
one of those plants perform very well. But if we're going
to compete going forward, we've got to do better than just
individual performance, and so we need to be able to share
and use the best practices, standards, policies, processes.
And that's what the peer groups are all about, to put
together the best from each one of our sites, the best from
across the country, wherever we get the best practice, and
this is the division that we decided to break it up into so
that we could focus on those processes.
MR. KEISER: The management administration, work
management, equipment reliability, configuration control,
and materials and services come from the advanced light
water reactor program and in essence where the industry got
together and defined these as the critical processes within
the powerplant. So they are truly process-oriented. The
other ones are activities upon which we want focus and step
change and improvement. Thus it's outage performance, it's
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operations and training. So we establish peer groups for
process orientation and then for functionality orientation
in addition to these peer groups we have approximately 55
peer groups within engineering that we're utilizing to set
the standards seismic calculations, if you will,
heat-transfer fluid flow, within a specific area, so there
are technically oriented peer groups of the 55 engineering
ones process oriented management administration, et cetera,
and then function-oriented operations, outages.
COMMISSIONER ROGERS: Well, you mentioned that
each one of these is led by a corporate vice-president level
person.
MR. KEISER: As a sponsor; yes, sir.
COMMISSIONER ROGERS: Yes. Now what's the lowest
level of person on any of the peer groups? In other words,
for instance, do you have any people on a peer group that
come from the union?
MR. KEISER: The peer groups spawn what we call
win teams, and there can be union representation on the WIN
teams. In addition to these peer-group efforts, we have an
issue referred to as engage the work force. And those ares
cross-functional multidiscipline teams, and at some of the
sites they are led by our craft employees, particularly I
want to mention the Quad Cities one that we're focusing on
industrial safety. That is being led by an individual from
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the craft.
COMMISSIONER ROGERS: There's a whole concept, the
peer concept, it seems to me, has to in some way embrace
everybody.
MR. KEISER: Absolutely correct.
MR. O'CONNOR: We would agree.
CHAIRMAN JACKSON: Commissioner Diaz.
COMMISSIONER DIAZ: I believe that you firmly
believe that you're doing the right thing, and I believe you
presented here your philosophy and some major details of a
plan that you're trying to implement or are implementing,
and you also provide a lots of information to the staff.
But I do have a problem, and the problem is that
we are seeing each and every one of these things as major
commitments, and I understand that, but I fail to see
details, even at the level of the Commission, like
Commissioner Rogers was just pointing out, you are doing
some very good things trying to assemble a peer group. In
the entire discussion we went -- repeated many things, and I
believe that's a good philosophy. I think you have -- those
are limits in there.
But I don't know whether it is my lack of
capability is because it's Friday, but I am seeing the
second level of details that would allow the Commission to
really be satisfied that you're doing what you say that
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you're doing. And I have the same problem with Millstone
very recently. And I am concerned that maybe we're not
asking the right questions. Maybe we should specifically
say if you have a model in how you're going to do these
things, present the model, give us the, you know, not the
little, tiny details, but what is the model that we're using
to make this change. And show in there, if you're using
indicators, how indicators are being used. Show us an
example of how that is being used. I think we need to know
at what level are you penetrating the organization, at what
level are you effecting these changes, and I am sorry, I'm
not seeing that.
There's a lot of information in here, but at the
Commission meeting I believe an additional level of
information is needed beyond that what you presented, and I
think it's very important to us. We want you to give us
your views. We need to know what you think. We need to
know what are you actually doing. And we go through this
document and we can see all kinds of things going different
ways. But you have the knowledge to put them together into
models, charts, graphs, things that actually indicate what
your trends are. If they are not completed, tell us they're
not completed. If you get a preliminary indication, that's
fine, but I need to see how they interact. Maybe it is the
serious problem that I am, you know, an engineer, and I need
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to see how these things function, but I am not seeing how
they function. I am really totally baffled that we have
this many philosophical statements and this many
commitments, but I don't see where they fit, and I am
disappointed in it.
MR. KEISER: We would appreciate the opportunity
to either return to the Commission, meet with yourself --
CHAIRMAN JACKSON: You will have the opportunity
to return.
MR. KEISER: There is a lot of detail. There is a
lot of detail.
COMMISSIONER DIAZ: But I want to be clear, we
don't need detail that you provide the staff, but we need,
when you say we're making this major commitment and we're
making a new model in how to do peer review, you presented
in there a graph. We need to know how that is working.
That is information that would allow us to know how you're
impacting your human resources. If you're doing something
in requalification training, okay, you'll say this is what
we're doing, this is the emphasis that we're taking. If
you're redoing your operator training, okay, I mean this is
the concept, this is what we do. Very simple at policy
level, but something that gives us something to hang our hat
on. And I don't have it. I'm sorry. I've come out of
today's meeting incomplete and baffled, and I don't think
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that is right. I think you have the ability of providing
that information, and I will respectfully request that you
do so.
MR. O'CONNOR: Commissioner, we'll try to be as
responsive as we can to that request. We had thought that
in our submittal to you with the information that was
contained in there that it formed a baseline that would give
everyone an opportunity to judge, assess the performance,
the trends of improvement that we expect to achieve. We
thought that was here. As you noted, I am certain many of
the performance indicators that we selected are not yet
perfected because, as we indicated, we wanted some more
trial and testing experience over the next few months to get
them there. But we will provide for you more detail.
CHAIRMAN JACKSON: I think what we're talking
about, Mr. O'Connor, is really a presentational issue. I
don't think -- I mean, the real issue is, of course, that
document is a compendium. The issue of course whenever you
come to a public Commission meeting is what you choose to
publicly present or not. I think what the Commissioner is
saying is that there's an opportunity going forward to
extract from the voluminous detail that may be in the
document that's submitted through the formal channels some
key information that should be presented in the public
arena, and --
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MR. O'CONNOR: We understand that.
CHAIRMAN JACKSON: And a lot of that has to do
with some of the kinds of questions that I've been asking
you, that Commissioner Rogers has asked, that Commissioner
McGaffigan in about 30 seconds will have the opportunity to
ask. But it is a lot easier and it allows for more coherent
understanding if, in fact, you do that instead of our having
to draw it out.
COMMISSIONER ROGERS: Excuse me. Could I just
jump on that little bit?
CHAIRMAN JACKSON: Sure.
COMMISSIONER ROGERS: You already said the right
words. You said, you know, what management measures,
management gets. Well, you know, we're looking for the
measures. You've said what the measures are, but you
haven't said what the, you know, the data are that go along
with those measures, what you're going to measure, and even
in a preliminary way something that begins to show that
there are quantitative determinations of some of these
measures if they're available. And I think that's a bit
what I'm --
CHAIRMAN JACKSON: Right. I'll just say, for
instance, I think you missed an opportunity, for instance,
to talk about in more detail what you're doing at Zion with
the assessments, with the -- and LaSalle -- with the
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intensified training, what that means, because we're faced
with an issue having to do with operator actions relative to
the reactivity -- I mean the criticality control, however
you want to talk about it, movement of rods at Zion. That's
an issue, that reveals problems.
What were these assessments? Why were you doing
them? How is that going to allow us to understand that you,
you know, clearly are focused on safe operations and that
what you're doing is aimed to get at that? It's 11:47, so
we're not going to redo it today, but that's the kind of
thing I think the Commission would like to hear.
You know, each one of us may focus in different
areas, but there's an opportunity to say what are the
problems and show us that you've clearly understood them,
this is what you're doing specifically and why you -- that
-- what you're doing is meant to address, you know, and you
think is going to address, and what metrics do you have to
show that success or not? I mean, I think that's what we're
talking about.
Do you have --
COMMISSIONER DIAZ: Yes, I have just a very brief
thing. I know that you might be concerned that your things
are not finished, but the fact that they are there and
evolving is important.
Borrowing from the wisdom of Commissioner Rogers,
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as he said, it is important that there be an error to
control a process, and we know that. If you don't have an
error, you don't have process variables that you can use.
So, you know, even if your indicator is not perfect or is in
error, at least it is trending, it is important.
CHAIRMAN JACKSON: Let's give Commissioner
McGaffigan an opportunity.
COMMISSIONER McGAFFIGAN: On this issue of
performance indicators, Mr. O'Connor, you said that your
goal is to be above the industry average in the seven
comparative indicators by the year 2000. An example of
something -- if you have it, please tell me -- but an
example of something that would be useful is to track that
now and to tell us where you stand today at the twelve
plants and on the seven indicators and then we could sort of
track going forward how you're making progress. If you
don't have that today, maybe that's something for next time.
MR. O'CONNOR: We will provide that.
COMMISSIONER McGAFFIGAN: Okay.
MR. O'CONNOR: That's a good suggestion.
COMMISSIONER McGAFFIGAN: One of the fundamental
issues that it strikes me, you know -- and you do have the
advantage or the disadvantage of being here the same week as
Millstone, but Mr. Kenyon, when he testified to us in
January and then again this week, he talked about inheriting
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a dysfunctional organization, inheriting an -- and bringing
in a lot of senior managers, as you have done, over the last
couple of years, and discovering that people below them, the
next level of management, really wasn't very good in some
respects. I'm not going to put words in his mouth; we have
the exact transcript.
What they instituted at that institution, feeling
that they might have fundamental management problems, was a
look bottom-up at their managers, not the union folks, but
the managers one step or two steps below the folks here at
the table and behind you, and in fairly brutal fashion, in
January and two days ago, he described a process where, you
know, the bottom 10 percent, a lot of them are no longer
with Northeast Utilities.
So my question goes to, you know, do you have
dysfunctional management below the senior level as he
recognized and his senior folks he brought in recognized was
the case at Northeast Utilities? And I haven't heard
anything -- I heard stuff about the union folks and the
operators and whatever, but I haven't heard -- what about,
you know, the problem of getting the sort of expectations
and performance out of the next level managers in our
organization?
CHAIRMAN JACKSON: Well, I'm interested down to
the first-level supervision.
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COMMISSIONER McGAFFIGAN: Right.
CHAIRMAN JACKSON: Because that's where the rubber
meets the road.
MR. MAIMAN: I think Mr. Keiser and I would like
to talk about this a little bit. We've already done the 10
percent thing. We didn't perhaps publicize it as much as we
should have, but that's behind us.
MR. O'CONNOR: Why don't you describe what that
is.
MR. MAIMAN: Well, when we went through our
ranking process -- no matter what kind of an organization,
there's always the broad middle and there are some that are
the top and some that are at the bottom, and those at the
bottom were identified and some are no longer with us,
others are in different locations and so forth.
But the process that Harry described also, Mr.
Keiser described, about the assessments and the feedback and
the opportunities to enhance efficient skills, if you will,
is a longer term effort. I mean, you don't train people in
just a few weeks where there are deficiencies in management
skills and so forth.
So we are about that, and maybe we haven't
publicized it as aggressively as we should have, but indeed
we recognize that as an important adjunct to simply bringing
in people from the outside who already possess those skills.
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COMMISSIONER McGAFFIGAN: But are you doing --
his process is going to continue. They're going to have
another round where employees -- is there any employee
evaluation from the bottom up as to who's an effective
manager and who isn't? Not that that's, you know, that that
is, you know, everything; you may end up having a different
judgment and you all have to use your judgment. But, I
mean, they have an iterative process going at Millstone to
try to fix what they thought was a dysfunctional management
team, and the question for you all is is that continuous
process necessary.
MR. KEISER: One major difference between
Northeast Utilities and Commonwealth Edison is we are
operating six different sites that have different levels of
performance and different cultures within it. So it would
not be fair to characterize Commonwealth Edison as a
dysfunctional organization. The approach that Tom and I
have been taking is to -- along with Mr. O'Connor and the
rest of the team -- is to maximize our economies of scale.
That's where our great strength is, that's what our hidden
weapon is, if you will.
As I mentioned earlier, we've attempted to set out
a program to change the culture of the organization,
recognizing the importance of first-line supervisors; and so
we did change the compensation system to one of pay for
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performance to encourage superior performance on the part of
individuals; did come out with reward and recognition
programs, again to change the culture.
We did come out with a new performance appraisal
process that entailed the ranking of the individuals,
identification of our 15 top performers because we want to
know who they are so we can advance them through the
organization and provide them the development that's needed.
We also did have the opportunity to identify those
non-performers and put them all on accelerated development
programs so we could take the appropriate action as
required. We did focus on the assessment centers, taking
all of the first-line supervisors, and we're in the process
of that, and putting them through an assessment center to
find their strengths and weaknesses and who should or should
not be a supervisor, if you will.
Part and parcel of that assessment center is an
assessment document, I'll say a validated process for their
supervisor to fill out an appraisal on the individual, the
peers to fill out an appraisal on the individual and
subordinates. So it's a true 360 form, if you will, to
provide all this information back to the individual's
supervisor and, of course, to the individual so we can
develop their strengths and weaknesses and come up with
programs. So I mean we just have a significant amount of
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activities ongoing to change the culture, to change the
performance of the first-line, second-line, third-line
individuals.
One of the strengths of having a large
organization is that we have a strong need for technical and
staff work, so for those who are incompatible as first-line
supervisors or supervisors of employees, we can move them
off and use their, you know, technical expertise in staff
work, et cetera.
So, I mean, I think we are utilizing all of the
attributes that Mr. Kenyon will be utilizing at Northeast.
He and I have had some conversations about it.
MR. O'CONNOR: Having said all that, we will take
a look at what they do in their programs to see if it's
applicable to any of our operations.
CHAIRMAN JACKSON: We're waiting for their
results, too.
COMMISSIONER McGAFFIGAN: Yes, we're waiting for
their results. But I'll tell you, the fundamental issue,
when I have people from the industry in talking to me, they
honestly think you have substantial management problems and,
you know, I don't know quite how that gets conveyed to you
all, but in the privacy of my office, just asking your
peers, they still think you have substantial management
problems as of the last few weeks. Now, they haven't read
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your 50.54(f) report, but I just -- you know, I know it's
important, and Mr. Maiman said earlier, we have the best
people and it's important to motivate the work force, and I
know from personal experience, having worked, you know, it's
important to motivate the work force by rewarding those who
are doing well and not necessarily rewarding or getting rid
of the folks who aren't. So if there is a -- I would
honestly suggest that you get some frank peer review. You
shouldn't get it through me at the -- you know, just talk to
your colleagues as to whether they think you're on track
yet.
CHAIRMAN JACKSON: I think we need to move along
and so I will thank you for now.
We will hear from the staff.
Last is not least but we want to try to be
efficient.
MR. CALLAN: Yes, Chairman.
I will say at the outset during Commonwealth
Edison's presentation, Bill Beach and I were steadily
editing out material so you are going to get a pared down
version. But we have a lot of backup material if you have
questions.
With me at the table are Bill Beach, to my left,
who is the regional administrator for Region III located
just outside of Chicago.
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To his left, a recent addition to the table,
that's why he has a handwritten name tag, is Marc Dapas who
is a branch chief in the Division of Reactor Projects in
Region III and he has direct oversight responsibility for
the Zion and LaSalle stations in Region III. And I made the
decision to include him with us because of the pivotal role
he plays in the agency's oversight of Commonwealth Edison.
To my right is Frank Miraglia who is the deputy
director of the Office of Nuclear Reactor Regulation and
then to his right is Roy Zimmerman who is the associate
director for projects.
As you said, Chairman, in your opening remarks,
our purpose this morning or this afternoon is to briefly
provide our assessment of Commonwealth Edison's response to
the 10 CFR 50.54(f) letter.
I think it is important to note before I turn the
discussion over to Bill Beach that the agency has and
continues to invest substantial inspection and oversight
resources to the Commonwealth Edison sites. For example, in
the 12-month period ending this week, Zion, Dresden and
LaSalle stations have each received almost 10,000 hours of
direct inspection time and that does not include time spent
preparing for inspection or documenting. That is hours on
site in the plant by inspectors. That is roughly twice the
inspection effort that average two-unit facilities would be
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receiving. We have every expectation to continue that level
of expenditure and maybe even increase it as we go forward.
So the staff has a solid foundation for developing
its own independent perspective on Commonwealth Edison's
performance. And, with that, I will turn the discussion
over to Bill Beach.
MR. BEACH: Good morning, Chairman, Commissioners.
I am here today to present the Staff's assessment of the
Commonwealth Edison response to our January 27, 1997, letter
requesting information pursuant to 10 CFR Part 50.54(f) to
determine what actions if any should be taken to assure
Commonwealth Edison company can safely operate its six
nuclear stations while sustaining improvement at each of the
sites.
Next slide, please.
The Commission requested this information because
of the historic and relatively recent cyclic performance of
Commonwealth Edison's nuclear sites. As discussed in a
previous Commission paper, SECY 92-228 dated June 25, 1992,
Commonwealth Edison has developed many improvement programs
over the years that have not been fully effective and much
of that was discussed in their presentation this morning. I
think the important point there is the failure to
effectively deal with emerging problems and take lasting
corrective actions resulted in cyclic performance.
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This performance has been a function of, one, lack
of effective management attention and application of
resources, weak corporate oversight of nuclear operations,
poor problem recognition and the failure to ensure lasting
corrective actions, a lack of adequate engineering support
and an inability or reluctance to learn from experiences
within Commonwealth Edison and at other utilities.
Next slide, please.
CHAIRMAN JACKSON: Before you go, let me just ask
you three questions. Given the cyclic performance and given
that we are hearing from our own staff, can you discuss the
effectiveness of the NRC inspection program and our
enforcement policy in identifying and taking appropriate
regulatory action concerning the cyclical performance of
Commonwealth Edison? That is one question.
The related question is, can our process be
improved relative to identifying and preventing cyclical or
declining performance?
And then the third question which plays directly
off of Mr. Callan's comments about the number of inspection
hours, is it additional NRC resources that if focused on
Commonwealth Edison any earlier or on a continuing basis
have helped to mitigate or change the declining or cyclic
performance? Because what we need to understand is both
your assessment of where they are today but, since we are
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coming off of a history, depending upon the given station
one wants to focus on, of over a decade of a certain kind of
weak performance, it does beg the question of the
effectiveness of our inspection and enforcement policy in
addressing these sorts of issues.
MR. CALLAN: Chairman, let me take a stab at that.
Actually, it was that line of questioning that was the
genesis, in my view, of the staff's decision to issue the 10
CFR 50.54(f) letter. I think if you look at the history of
Commonwealth Edison and just look at specific plants, I
would argue that the NRC inspection and enforcement programs
worked reasonably well. In other words, as individual
stations' performance declined to an unacceptable level, the
NRC would focus resources, utilize enforcement and then that
station's performance would, in fact, improve slightly. But
at a cost, a cost of a corresponding decline at another
station.
What our inspection and enforcement programs were
not and are not equipped to do well is to step back and look
at several stations simultaneously and look at a corporate
performance and the issuance of this letter to Commonwealth
is perhaps maybe the first time that we have systematically
done that with the licensee, with a corporate entity.
CHAIRMAN JACKSON: Okay. Mr. Beach.
MR. BEACH: Where are we --
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CHAIRMAN JACKSON: The second slide, Evaluation
Process.
MR. BEACH: Good, that's the one I want to be on.
As the Chairman stated in the introduction this
morning, a multidisciplinary team of senior managers and
Staff was assembled to review the response.
The major point we wanted to make in this area,
that plays off Joe's answer, is that prior to receiving the
response the review team developed assessment criteria for
reviewing the content and quality of the response and the
assessment criteria were not used to make a pass-fail
determination on the quality of the response but rather
criteria were developed for those areas that the NRC would
expect Commonwealth Edison to address based on the NRC's
assessment of the past and current cyclic performance
problems.
CHAIRMAN JACKSON: Are those criteria the review
criteria for the Commonwealth Edison response available for
public scrutiny?
MR. ZIMMERMAN: I can best answer that. That is
the first phase. We'll be going over those items on the
next slide.
CHAIRMAN JACKSON: Okay.
MR. ZIMMERMAN: In a tiered approach from there
the Staff prior to receipt of the letter from Commonwealth
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developed a significant number of sub-tier items from which
they spun off with questions in each of those areas and I
would be glad to talk about that more perhaps when we get to
the next slide.
MR. MIRAGLIA: But I think the answer to your
question, Madam Chairman, is the Staff's evaluation of the
5054 against the criteria used to come to that judgment, our
plans were as indicated in the package we sent to you, which
we sent along with a letter to Commonwealth.
CHAIRMAN JACKSON: Put it into the public record?
MR. MIRAGLIA: Put it into the public record.
CHAIRMAN JACKSON: Public record -- that is what I
wanted to know.
MR. MIRAGLIA: This is what the Staff did, the
criteria used --
CHAIRMAN JACKSON: Fine.
MR. MIRAGLIA: This is the basis for the judgment
reflected in a proposed response --
CHAIRMAN JACKSON: Fine. I just want it on the
record today.
MR. MIRAGLIA: Yes. Yes, ma'am.
CHAIRMAN JACKSON: Okay.
MR. BEACH: Next slide, please.
The Staff recognizes that the key to avoiding
future cyclic performance at the nuclear stations is
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effective implementation of sound programs designed to
correct the fundamental root causes of performance problems.
Therefore, the Staff reviewed the response to
determine if the Licensee, one, recognized and acknowledged
the previous and recent cyclic performance weaknesses; two,
evaluated the root causes of cyclic performance; three,
developed programs or initiatives designed to correct those
root causes; four, established goals and standards to
measure operational performance; five, developed the
self-assessment tools necessary to measure operational
performance; and six, specified the actions needed if
performance at each station did not meet established goals
and standards.
CHAIRMAN JACKSON: And are you telling us there is
a check-off on each of these areas?
MR. BEACH: Yes, ma'am.
CHAIRMAN JACKSON: Okay.
MR. BEACH: Next slide, please.
This morning Commonwealth Edison discussed a
number of differences in its plans today versus previous
plans.
The Staff sees three initiatives discussed in the
response that are considered to be improvements over plans
developed in the past.
First, the actions taken by the Board of Directors
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of Commonwealth Edison, or Board, to increase independent
oversight of the Nuclear Program and to increase the
financial resources for improving initiatives is a
difference.
As indicated in the Commonwealth presentation, the
necessary resources were benchmarked against industry good
performers and budgets were increased based upon the
performance issues facing each plant and the identified
needs of the sites for operating safely and sustaining
performance improvement.
Second, also fully described in the earlier
presentation, actions are being taken by Commonwealth Edison
to enhance the oversight of its Nuclear Program at all
levels of the organization.
Several specific actions are being taken at the
corporate level, division level, and at the site level.
At the corporate level the Board has recently
taken a much more direct and active role in ensuring
performance improvement in the Nuclear Program and has
strengthened the membership in and role of the Nuclear
Operations Committee.
The Board has directed the committee to report on
the results of its periodic independent assessments of the
effectiveness of the improvement plans initiated by
Commonwealth Edison management.
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At the division level, the Nuclear Operations
Division oversight staffing levels have been increased, and
the assessment and audit programs are being formalized and
expanded.
As Mr. Maiman indicated, the oversight and site
quality verification organizations are establishing a
division-wide standard analysis and reporting process that
is very similar to our integrated performance assessment
process, and finally at the site level safety or management
review boards are being implemented at each site.
The third initiative considered to be an
improvement from those improvement plans in the past
involved the formal development of an integrated structure
of performance measures and actions that will be taken if
the measures are not met. This was discussed in detail by
Mr. Keiser and I would point out a meeting is being
scheduled for Commonwealth Edison to brief the Staff in more
detail regarding these performance measures in the near
future.
CHAIRMAN JACKSON: Before you go on, what
improvements or activities are missing from the plan or
should be further enhanced, from your perspective, and what
areas will the Staff emphasize going forward in its
monitoring, ongoing monitoring of Commonwealth?
MR. BEACH: I think overall we see very few things
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in the response that we wouldn't have put in the response.
I think the problem, as you discussed in the
previous presentation, they are at various levels of
implementation and whether or not they will work if
implemented, you know, is the question of whether or not
they are the right ones.
CHAIRMAN JACKSON: Are there particular areas that
the Staff is planning to itself emphasize?
MR. ZIMMERMAN: Perhaps there are a few areas that
I can mention that came from the review team's efforts.
One of those had to do with the Engineering
Assurance Group that was discussed with Commonwealth Edison
in terms of understanding how that function will be
integrated with the routine engineering efforts that are
ongoing at the site and how it will strengthen safety
performance.
In our review of their submittal, that was an area
that we wanted to carry on additional dialogue with them on.
There was discussion also with CommEd about their
communications with the industry at large and between their
sites, but didn't see discussion between departments, and
they have had some difficulties -- interdepartment dialogue
between Operations and Maintenance or Operations and
Engineering, and we wanted to discuss that as well.
The lead teams or the peer teams, in understanding
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how they will work to get volume from the organization
because of the importance of the role of individuals to
carry out the work was another area that we wanted to
explore.
The initiatives in the maintenance work control
area, although there was substance to those, it wasn't clear
to us how productivity was going to be improved, how they
were going to be able to get more work done through their
work control process. We wanted to understand that better
as well.
They were silent in the area of improving
licensing submittals. That is an area that has been
developing recently, and we recognized that some of the
areas where we feel there have been shortcomings in the area
of licensing it is important for us to bring those forward
and discuss that with Commonwealth. We have not done that
much in the past but we will be doing it during that meeting
as well.
CHAIRMAN JACKSON: You mentioned discussing it
with a meeting, so do you anticipate requesting additional
information pursuant to 5054?
MR. ZIMMERMAN: Not sure at this point --
CHAIRMAN JACKSON: Okay.
MR. ZIMMERMAN: -- whether that would be needed or
not.
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MR. MIRAGLIA: I think the characterization in the
evaluation that was provided to the Commission, Madam
Chairman, indicated that these are areas that the Staff
wanted further dialogue, understanding, and discussion on,
but I don't think it was characterized in the evaluation
that this would constitute an unacceptable response.
This is information that we can get by meeting and
having further understanding and then take appropriate
actions following those kinds of discussions and dialogue.
CHAIRMAN JACKSON: Okay.
MR. BEACH: I'll get more into detail on that.
CHAIRMAN JACKSON: Okay, very good.
MR. BEACH: Next slide, please.
CHAIRMAN JACKSON: Yes, I'm sorry -- Commissioner
McGaffigan?
COMMISSIONER McGAFFIGAN: On the last slide you
skipped over one of the -- you know, you said there were
three areas for improvement and then you didn't mention this
benchmarking financial resources, et cetera, point.
Have you decided that is not an area of
improvement, or why did you skip over it? Improvements over
previous plans.
MR. BEACH: I did mention it.
COMMISSIONER McGAFFIGAN: Did you?
CHAIRMAN JACKSON: Okay.
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MR. BEACH: Yes, sir.
COMMISSIONER McGAFFIGAN: That was part of one?
CHAIRMAN JACKSON: I thought he had talked about
it.
MR. BEACH: I am now on the adequacy of response
slide.
CHAIRMAN JACKSON: Yes.
MR. BEACH: The staff concluded that the response
describes a broadly based and reasonable set of accents
which, if effectively implemented, should enhance
Commonwealth Edison's capability to operate, monitor and
assess its six nuclear stations while sustaining performance
improvement at each station. As such, the staff concludes
that Commonwealth Edison satisfied the NRC's request for
information pursuant to 10 CFR Part 50.54(f).
In reaching this conclusion, the staff determined
that the response addressed each of the review objectives
discussed earlier. Of particular importance is Commonwealth
Edison's initiatives to establish a set of performance
measures for assessing and monitoring performance at each
station in its proposed actions if these measures are not
met. The measures have been established in large part from
Commonwealth Edison's assessment of the root causes for its
failure to achieve sustained performance improvement that
was discussed earlier.
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The assessment considered the fundamental causes
for performance problems identified in the independent
self-assessment team evaluations conducted at LaSalle and
Zion. The NRC's 50.54(f) letter requesting information
pertaining to the maintenance of the plant engineering and
design basis at all six of its sites and the Dresden
independent safety inspection.
With respect to the independent self-assessment
team evaluations, staff considered these evaluations to be a
significant positive initiative because of the independence
of these assessments and that they were performed by
industry peers.
The staff also recognizes that many actions have
already been implemented and other improvement programs and
initiatives outlined in the response are new and in
different stages of development as we were discussing.
However, long-term success is highly dependent on the
ability to effectively implement these improvement programs
and initiatives.
CHAIRMAN JACKSON: Let me ask you a question about
that.
What criteria will the staff use to assess whether
the Commonwealth Edison plan is effectively implemented?
MR. MIRAGLIA: I think Bill was prepared to
address that in a later slide but, basically, they have
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specified criteria and action levels and actions that would
be taken to determine the responsiveness of that. So that
will -- we are monitoring their response in terms of the
overall plan.
With respect to the individual sites, we will
continue to monitor and inspect and evaluate each of the
sites through our own processes, as we have in the past, as
Mr. Callan and Bill have indicated that have been
substantially augmented.
Bill might want to add to that.
CHAIRMAN JACKSON: Well, if you are going to speak
to it later, we can wait.
MR. BEACH: I am not sure I have the detail you
want but there is an opportunity to raise that question and
also the current issues at the sites.
CHAIRMAN JACKSON: Okay, very good.
MR. BEACH: Next slide, please.
I would like to take a few moments to discuss the
current assessment of performance, our assessment of
performance at the six Commonwealth Edison nuclear stations.
Obviously, there is a range in performance among the six
Commonwealth Edison sites.
At Zion, performance was considered adequate prior
to the recent reactivity management event. The event served
to highlight the depth of the problems in operational
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performance and indicated that improvement is still needed.
At LaSalle, problems continue to exist in a number of areas,
despite implementation of nearly half of the restart action
plan.
Overall performance at Dresden continues to
improve. Performance at Quad Cities has been improving over
the last six months with both units at power operation for
an extended period of time. Overall performance at
Braidwood is considered good with noted improvements in
material condition. Byron's overall improvement has been
good to excellent but there are indications that performance
in the areas of maintenance and engineering may have
slightly declined, given a recent silting event where some
design problems, untimely corrective actions and inadequate
surveillance testing collectively may have resulted in a
degraded ultimate heat sink under certain design conditions.
There has been a consistent level of good performance in the
area of operations.
At Zion, both units are currently shut down. In
September 1996, Unit Two was shut down and in February of
1997, during a shutdown because of a containment spray pump
problem, an operator attempted to return the reactor to a
critical state by continuously withdrawing control rods
contrary to procedural instructions.
An augmented inspection team identified a number
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of human performance deficiencies involving both the
operating crew and licensee management. The NRC issued a
confirmatory action letter to formalize the licensee's
corrective action commitments for the identified performance
problems.
The licensee initiated a number of actions to
address the identified operator performance problems that
included restructuring of the operations department and the
implementation of a training upgrade program for licensed
operators. As part of the initiative to restructure the
operations department, 141 of these employees were selected
to undergo a three-week training program aimed at improving
performance standards.
To facilitate improvement at Zion, the licensee
established a new management team which has communicated
goals and expectations to all levels of the organization.
However, based on performance to date, it is not apparent
that all levels of the organization have fully committed to
the new expectations and standards.
We have recently revised the original confirmatory
action letter to include specific commitments by the
licensee to address the human performance problems and
operations, some material condition issues affecting startup
and weaknesses in engineering support to operations that
have been identified by the NRC and the licensee.
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At LaSalle, both units have been shut down since
September 1996 to address a variety of human performance
deficiencies and hardware problems. A comprehensive restart
action plan has been developed. To date, nearly half of the
actions in the plan have been completed, however problems
involving operator performance, corrective actions and
maintenance of the plant's design basis continue to surface.
Licensee has identified weaknesses in command and
control, communications and control panel awareness problems
exhibited by operators during evaluations of operator
performance and simulator exercises.
Depending upon the specific performance deficiency
exhibited by an operator, corrective actions consist of
either short-term or long-term remediation and reevaluation.
As with Zion, a new station management team appears to be
providing the station staff with appropriate direction and
both plan and corporate management have communicated goals
and expectations to all levels of the organization in many
different forms.
Although there currently appears to be
considerably more commitment of the staff to these standards
at LaSalle than at Zion, the licensee's organization still
has not yet fully committed to these management expectations
and standards. We have issued a confirmatory action letter
at LaSalle also to formalize the licensee's corrective
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action commitments for identified performance deficiencies
addressed in the restart action plan.
Moving on to Dresden, overall performance
continues to improve with a consistent level of performance
observed in plant operations. Maintenance work activities
of the past six months have generally been performed well.
Over the last six months, the licensee has focused attention
on a number of issues identified last fall during the
independent safety inspection.
The NRC issued a confirmatory action letter on
November 21, 1996, to confirm the actions the licensee has
taken to address the engineering deficiencies identified
during the ISI. These actions include the establishment of
an engineering assurance group to provide oversight of
engineering activities and validation of selected aspects of
the design basis for the 12 most risk-significant systems.
At Quad Cities, overall performance over the last
six months has been improving. In general, the conduct of
operations has improved with relatively few operator errors.
The reorganization of maintenance into a number of multi
disciplined teams has enhanced teamwork and initiatives in
work control have resulted in improving the quality and
efficiency of the maintenance activities.
In engineering, the licensee is focused on efforts
on improving resource tracking and use with root cause
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training and problem identification and resolution. A
recent problem with auxiliary switch contacts and 4 kV
breakers was satisfactorily resolved with good engineering
support to operations and communications between the
engineering staffs both at Dresden and Quad Cities where the
same problem had occurred.
At Braidwood, Braidwood continues to be viewed as
good and has remained generally consistent with the SALP
assessment conducted in September 1995. Improvements in a
number of areas including a decrease in personnel errors by
nonlicensed operators and plant material condition have been
observed. Some problems with procedural compliance,
particularly in the areas of operations and maintenance,
however, are being identified.
Finally, at Byron, while overall performance has
been good to excellent, some slight decline in performance
has been noted relative to that observed during the last
assessment which ended in August 1996. Performance in
operations has remained good. Some problems with consistent
operational practices between licensed and nonlicensed
operators have existed. Operator performance during recent
startups and shutdowns has been good.
And that is all I have with respect to the current
status of the plants.
CHAIRMAN JACKSON: Let me ask you a couple of
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questions, Mr. Beach.
How would you characterize Commonwealth Edison's
response to the recent events at Zion and the operator
performance issues at LaSalle within the context of this new
plan?
MR. BEACH: I think the response to the issues at
Zion have been rather aggressive. The actions taken are
something that you wouldn't normally see a licensee make
these kind of decisions, particularly in deciding to
revocate licensed operators, licenses from operators.
The training at LaSalle issues, we have reviewed a
number of tapes from when you were there. Many of those
deficiencies that are being considered for remediation are
management expectations and would not necessarily be things
that we would consider failures with respect to an operator
licensing examination. So the bottom line, I think, is that
the actions that they are taking with respect to operations
are aggressive and with fairly high expectations.
CHAIRMAN JACKSON: Can you give us a brief rundown
of the status of the various confirmatory action letters
that are still in effect that have been issued? You
mentioned them. But in terms of where they are relative to
the issues in those letters?
MR. BEACH: I am going to repeat them again. But
they are at LaSalle, Zion and Dresden.
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CHAIRMAN JACKSON: Okay, and can you give us some
substance of the letters, you know, what they address and
what the status is relative to --
MR. BEACH: Yes, Chairman.
The confirmatory action letter at LaSalle
addresses the operator deficiencies, the material condition
deficiencies and the engineering issues that aren't specific
but are enumerated in the licensee's restart plan.
Basically, the confirmatory action letter ties to the
restart action plan.
At Zion, most of the commitments tie to the issues
with respect to the operator and operator problems that were
experienced as a result of the AIT. There are some material
condition problems that need to be corrected prior to
startup and there are some engineering issues, specifically
tied to operability evaluations that need to be corrected
prior to startup. That is not -- the CAL there is not as
extensive as the one at LaSalle.
The confirmatory action letter at Dresden relates
to the engineering issues that were brought up as a result
of the independent safety inspection at Dresden and is tied
specifically to engineering and also relates corporate wide
as to the deficiencies that involve, may involve the
potential of being a problem at all six sites.
CHAIRMAN JACKSON: You had a comment?
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MR. DAPAS: I was just going to mention that one
of the other areas that is addressed in the confirmatory
action letter at Zion which we issued as a supplement to the
original which we issued for the reactivity management event
discusses the results of their training initiatives to
address some of the operator performance deficiencies and it
also elaborates on having periodic meetings with the NRC to
discuss the results of their restart plan implementation so
that we can monitor and assess that.
Then we are requesting them to discuss with us the
basis for their conclusion that they are ready to restart
one of the units at Zion.
CHAIRMAN JACKSON: Are you going to talk about
your future actions.
MR. BEACH: Next slide.
Last slide, please.
Given this assessment of performance at each of
the six Commonwealth Edison stations, the NRC Staff
formulated plans to monitor current performance.
Regarding Zion and LaSalle, the Staff's plan for
monitoring licensee performance consists of the following
actions: one, Agency resources will continue to be used to
augment the region-based inspection program as necessary to
address performance issues; and two, the NRC will continue
to monitor performance improvement at LaSalle and Zion
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stations through the use of the joint Region III - NRR
Oversight Panels.
Designated senior oversight managers from NRR and
Region III will continue to provide leadership and direction
for these multidiscipline panels. The panels will assess
the restart action plans for both Zion and LaSalle and
monitor Commonwealth Edison's implementation of those plans.
In performing this monitoring and assessment
function, the panels will use resources from other NRC
offices as necessary. The Staff is using Inspection Manual
Chapter 0350, Staff Guidelines for Restart Approval, in its
assessment efforts at these plants.
The panels will also monitor and assess
Commonwealth Edison's corrective actions associated with
commitments in the confirmatory action letters issued to
each licensee.
Regarding Dresden, the NRC is continuing to
validate and assess licensee corrective actions associated
with commitments in the confirmatory action letter. This
includes evaluating the effectiveness of the Engineering
Assurance Group and the quality of the licensee's design
basis validation effort.
We are currently conducting monthly meetings with
the licensee to discuss progress on confirmatory action
letter commitments.
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In addition, an independent safety inspection
follow-up outage maintenance team inspection comprised of
inspectors from Region III, Region IV and NRR as well as the
Illinois State Resident Inspector is scheduled for
completion today.
This performance-based inspection focused on
observing ongoing maintenance activities and evaluating the
control of emergent work planning and radiation protection
practices in connection with work activities.
Next week the team will convene to collectively
assess the findings and will discuss the results with the
licensee at an exit meeting scheduled for May 12th, 1997.
I would also like to point out that the Resident
Inspection Program at Zion, LaSalle, and Dresden has been
augmented with a full-time region-based Engineering
Inspector including and additional region-based Inspector
for the review of corporate engineering issues at
Commonwealth.
The plans for monitoring Commonwealth Edison
performance is centered around the premise that the Agency's
inspection and assessment programs must monitor plant
performance individually and collectively, such that
improvement initiatives at each station can be evaluated and
negative performance trends can be identified as early as
possible.
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In implementing plans, the Staff will assess
whether the licensee's actions in response to plant events
or issues at one facility are impacting performance at the
other Commonwealth Edison sites.
The ability to manage improvement initiatives at
one station and not reduce good performance at another
station is critical to arresting the previous cyclic
performance and the ability to sustain performance
improvement. This sustained improvement may only be
demonstrated after a significant time period.
Significant Staff and senior management resources
continue to be committed to support the augmented inspection
and assessment programs associated with Commonwealth Edison
facilities. More communication and coordination between
regional and headquarters staffs and effective use of Agency
processes such as confirmatory action letters, Inspection
Manual Chapter 0350, and the plant performance review
process have and should continue to facilitate a more
comprehensive assessment effort.
As I previously discussed in connection with Zion
and LaSalle, the Staff's current strategy for monitoring
Commonwealth Edison performance is composed of Agency
resources that will continue to be used to augment the
region-based inspection program as necessary to address
emergent performance issues and the NRC will continue to
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monitor performance improvement at LaSalle and Zion through
the use of joint oversight panels.
These panels, chaired by senior managers, will
assist implementation of the restart action plan and
corrective actions associated with the confirmatory action
letter commitments at each site.
In addition, Region III and the Office of Nuclear
Reactor Regulation will continue to monitor and assess
corrective actions associated with the confirmatory action
letter issued to Dresden. Staff will also continue to
evaluate and close out the independent safety inspection
findings at Dresden as appropriate.
The plan performance review process will be used
to integrate performance observations from each station to
identify any common areas of marginal or unsatisfactory
performance.
Quarterly management meetings will be conducted
between NRC and Commonwealth Edison senior management to
discuss performance at the plants and the effectiveness of
corporate and site-specific corrective actions as described
in the Licensee's response to the 5054(f) letter.
Further, the NRC will continue to provide
increased senior management presence at the facilities to
enhance the Agency's understanding of plant performance and
provide valuable insights regarding the Staff's assessment
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efforts.
Finally, the Staff will continue to keep the
Commission informed about performance and will maintain a
low threshold for Commission involvement should adverse
performance trends be identified.
Consequently, the Staff concludes that
Commonwealth Edison satisfied the NRC's request for
information pursuant to 5054(f).
CHAIRMAN JACKSON: Let me just say the following.
The Commission sent Commonwealth Edison the 50.54(f) letter
and requested information, but it was requesting information
pursuant to the following question, and that is why the NRC
should have confidence in Commonwealth Edison's ability to
operate its nuclear station while sustaining performance
improvements at each site, and secondly to explain the
criteria that Commonwealth Edison has established or plans
to establish to measure performance in light of the
identified concerns.
Now, it strikes me that in many ways, a lot of the
focus of what we've talked about this morning relates in
some sense to the second part of that question, namely to
explain criteria that they've established or plan to
establish to measure performance. But at a certain level,
strung through all of this but not explicitly addressed is
what is the answer to the first question, and that is why
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the NRC should have confidence in Commonwealth Edison's
ability to operate its nuclear stations while sustaining
performance improvement at each site. And that's really the
question I want you in sum to address for the Commission.
As I look over your plans for actions for future
assessment of their -- of ComEd's performance, you mentioned
various dedicated managers, et cetera; but it seems that our
very processes are ones that are hinged on site by site
looks, namely looking at restart action plan and how to
implement it, looking at confirmatory action letters that
have specified things in them relative to the given station
to which they were issued, and third the manual chapter 0350
process is specifically station by station or reactor by
reactor oriented.
So the real question is, how is the staff going to
review and integrate the site-specific assessment finding to
reach an overall conclusion as to whether Commonwealth
Edison has effectively implemented its performance
improvement plan but in a way where they sustain performance
at all of the sites? Because that, in the end -- it's not
the narrow issue of did they specifically address what they
were asked to address in the 50.54(f) letter, and what
you've told us is that yes, they have specifically addressed
what they were asked to address in the 50.54(f) letter, but
inherent in that is why the NRC should have confidence in
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ComEd's ability to operate its nuclear stations while
sustaining performance improvement at each site.
So I want you to tell me how the various things
you've outlined, which seem very site specific, okay, is
going to allow an assessment corporate-wide. That's number
one. And number two, what is it today that's giving us
confidence their ability to do that?
MR. CALLAN: Madam Chairman, I'm going to let NRR
respond first, and then let the region follow up.
MR. MIRAGLIA: I think I'm going to answer that in
two parts. In terms -- the individual assessments need to
be done --
CHAIRMAN JACKSON: Absolutely. Absolutely.
MR. MIRAGLIA: What Bill indicated is that the
collective management groups that are looking at those
individual assessments are also going to look for
commonality between performance issues at the plants to
determine the linkage in an integrated type way, and perhaps
he went over that too quickly.
So the teams that are looking at the individual
sites are not only looking at the sites, but taking a step
back and saying the issues at this site, how are they
reflected and do they have some common trends to other site,
number one; and number two, is the response to those kinds
of activities or events changing and do we see a shift in
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performance at the other site as a result of that? So
that's an independent, based upon our own inspection
program, getting that look.
In addition, we'll monitor the commitments and the
overall trending that the utility has explained here today.
I think the real proof is going to be in the pudding, so to
speak, and I think this is the issue that the Commission,
Chairman Jackson and Commission Diaz raised. We need to see
the positive trends against those types of indicators. So I
think it's a combination of those activities by which that's
going to be --
CHAIRMAN JACKSON: Well, are you saying that
Commonwealth Edison's response to the letter has given you
confidence so that you want to give us confidence in
Commonwealth Edison's ability to operate its nuclear station
while sustaining performance improvement?
MR. MIRAGLIA: I think the answer to that is yes,
we've said that they've established measures in a program
which, if effectively implemented, will give us that basis
to be able to have concrete evidence and indicators that
demonstrate that, and I think the utility indicated today
that its effectiveness is varied at each of the sites, and
it has to be demonstrated across all of the sites. So it is
in some respects a commitment and a promise for the future,
and to have a plan and a program by which it can be
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monitored. We have our own independent inspection findings
that will overlay on that, that combination.
CHAIRMAN JACKSON: Remember, this goes back to my
original question in terms of the question of the
effectiveness of NRC's inspection program and enforcement
policy and other regulatory actions in identifying and
taking the appropriate regulatory action concerning the
performance. You're going to monitor it, and you say you
have a methodology to look at it and to integrate what you
find, but presumably we've been, you know, monitoring on an
overall basis all the time. So have you identified the
thresholds for regulatory -- further regulatory action? I
mean, I'm interested in, you know, where do we go from here?
MR. CALLAN: Well, Chairman, I think the
regulatory thresholds are constant. We're not devising new
ones for Commonwealth. We're not going to hesitate at all
to apply our various processes.
One perspective, just to follow up with what Frank
said, the types of things that the utility, Commonwealth
Edison, is proposing, that they presented today and in their
submittal, are variations on processes that have worked at
other facilities over the years, and we've been associated,
all of us at this table, with a fairly large number of
facilities that have improved their performance, in some
cases dramatically, using some similar types of programs.
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So the programs, we have a relatively high
confidence level that the programs themselves are solid.
They have worked at other facilities. The issue, again, the
issue that Bill in his slide underlined, is the
implementation aspects of the program, and if we just go on
history, then we shouldn't have much confidence, quite
frankly. The performance of Commonwealth Edison over the
years in implementing programs has been fairly dismal.
And so -- and I think, in their submittal, the
licensee made that point themselves, that there is very
little that they can point to themselves to give us
confidence that this time, these programs that, as I said,
that have worked elsewhere will work at Commonwealth. And I
think the staff will go forward with a high level of
skepticism, the same skepticism that you're reflecting,
Chairman, in your questioning; but we have very little to
find fault with in the programs because, as I said, they
have worked, variations of them have worked elsewhere.
CHAIRMAN JACKSON: Is there a regulatory window
within which they're operating that's going to close at any
point?
MR. CALLAN: Chairman, could you please ask that
again? I didn't understand.
CHAIRMAN JACKSON: Is there a regulatory window
within which they are operating that will close at any given
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point -- window of time?
MR. CALLAN: I'm still not sure I quite understand
the question.
CHAIRMAN JACKSON: How long do they have to have,
you know, before we expect to see sustained improvement?
MR. CALLAN: Well, if you'll be patient, I will
answer it in the negative. If we see declining performance,
we'll act promptly. As was said with the type of oversight
we have, I would hope that we would be relatively quick in
picking up declining performance, and we'll deal with that
aggressively.
If we don't see the kind of sustained improvement
that we would hope to see, that's a different issue, and I
think before we would act in that instance we would want to
interact with the Commission.
CHAIRMAN JACKSON: Okay.
MR. BEACH: I just want to add that these panels,
one of the things that they give us the ability to do is
rise above the day-to-day inspection issues, and I think one
of the things that maybe has been done in the past is that
the inspection, the routine inspection has also gotten
focused in the improvement plan, and so we've all marched
together.
We have to keep the inspection program focused on
what it's supposed to be focused on, and hopefully that will
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detect a declining trend, and if we have indicators that are
different than what the indicators that they have developed,
will be beneficial to both of us. What we can't do is fully
believe their indicators at the expense of the inspection
program.
CHAIRMAN JACKSON: Okay.
You mention augmented region-based inspection.
Where are those resources coming from? Are you
resource-strained?
MR. BEACH: If you're in a region, you're always
resource-strained, but --
CHAIRMAN JACKSON: Don't pay any attention to the
fact that --
[Laughter.]
MR. BEACH: We're to the point where we're cutting
in on some of the initiatives that maybe we would have done
at some of the other sites, but we're doing well at what we
have to do right now.
MR. CALLAN: Chairman, let me provide more of an
agency perspective. When we invest resources like we're
investing at Commonwealth, and as we're investing at
Millstone and some other places, there's not only the
immediate cost to the region, but those resources come from
resources that could be used looking at other facilities
that maybe have declining trends that we haven't detected
. 117
yet. It's the unknown that as a regulator you worry about
almost as much as the known. Our inspection programs are
designed largely to ferret out the unknown, and that's where
I think this resource expenditure is hurting us. We don't
have the resources that I'd like to have to spread out over
the other facilities in the country.
CHAIRMAN JACKSON: That actually relates, and it
doesn't presuppose any decision, so let me just say that for
the record, but that relates to the question I ask,
namely -- well really there are two embedded questions. One
could argue well, if they don't improve, then just shut them
down under an order and they stay there will they get it
together. The other has to do with how long do you continue
in the mode of the quote unquote intensive inspection
application when you do have other things that have to be
done?
That's why it is not a -- it's a nontrivial
question that I think we have to address, and I think the
Commission has to think about, because in a certain sense if
one is just kind of helping in coaching or pushing along or
limping along, there's a question as to where, you know,
there's a cutoff point just because of our own -- the
finiteness of our own resources, and the fact that we have a
wide range of other nuclear activities that we're
responsible for.
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Commissioner Rogers.
COMMISSIONER ROGERS: Well, just on that
observation, I have to differ with you a little bit in that
I think that it's not realistic to say that we shut them
down until they get it --
CHAIRMAN JACKSON: I didn't say that.
COMMISSIONER ROGERS: No, no, no, no. I didn't --
CHAIRMAN JACKSON: I didn't say that. I didn't
say that.
COMMISSIONER ROGERS: I'm just saying --
CHAIRMAN JACKSON: I'm saying to you the agency
has finite resources.
COMMISSIONER ROGERS: I understand that, and if
you just let me finish my point, please, that the notion
that an option might be shut them down until they get it
together does not allow you to not spend those resources to
determine if they've got it together. So I don't think that
one can simply couch that in quite that simple a term, that
the kinds of resources that we need to apply to determine if
they have got their act together is exactly what we're doing
right now.
So I think that one has to think that at some
point those resources are going to have to be directed to
determine whether they in fact have gotten their act
together. And it is going to take a lot. So I don't quite
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see that, you know, a realistic option is -- or the
consideration that you shut them down and they come up
again. If you shut them down, they won't come up again.
CHAIRMAN JACKSON: The real point has to do with
the licensee itself developing the appropriate sense of
urgency relative to its own need to improve its performance,
and that we ensure that we don't play into, as has been the
case, an unduly dragging out sustained improvement in
performance, so that things go on and on and on and on.
That's what we're talking about here, and that's what we're
talking about in terms of not only fairness to the licensee,
but fairness to our own staff. And that's all we're really
talking about.
Commissioner Diaz.
COMMISSIONER DIAZ: I just want to comment that I
believe the staff did an excellent job in putting this part
together and I want to congratulate you.
I think that we saw in the discussion it is
important that the staff determines if not a threshold
level, some level of indication in which it can provide
assurance to the Commission that Commonwealth Edison has
satisfied those requirements that meet adequate protection
of health and safety.
CHAIRMAN JACKSON: Commissioner McGaffigan.
COMMISSIONER McGAFFIGAN: You heard Mr. O'Connor
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say that one of his goals in the year 2000 is to have all 12
units above the industry average on these seven performance
indicators and I don't expect you all to, as some of these
are INPO indicators, to know where they are today but
is -- where are they today in our indicators? How many of
the plants would be in terms of SALP scores or whatever in
the top half of the industry? You know, of the 12 at the
moment, would Byron and Braidwood be in the top half?
MR. BEACH: I would think Byron and Braidwood
would be in the top half. Quad Cities and Dresden are still
lagging. They are at the 2.2 to 2.3 threshold but they are
moving into the 2 --
COMMISSIONER McGAFFIGAN: You are talking SALP
scores?
MR. BEACH: Right, SALP scores. But that would
probably be in the lower half. And, of course, Zion and
LaSalle are in the lower half.
COMMISSIONER McGAFFIGAN: I averaged the SALP
scores and I got 2.21 across the -- for the latest period,
knowing that it is hard to compare over time. Zion is
actually better in the SALP because it is an older SALP than
some of the others.
How many of their plants would be top quartile?
Have Byron or Braidwood been in top quartile country at
times in their existence?
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MR. BEACH: Byron has. There are currently two
1's and two 2's and I am not sure that that is top quartile
performance but it's close.
COMMISSIONER McGAFFIGAN: It's close.
Has there ever been a ComEd plant that is strait
SALP 1?
MR. BEACH: Byron was. In the previous SALP it
was also.
COMMISSIONER McGAFFIGAN: The reason I asked the
question is, what is the right goal? You know, Turkey Point
went from watch list to getting a superior performer letter
this January in three-and-a-half years and I am, you know,
it's really -- this discussion is really for ComEd but what
is the right goal? Is it to get them all into the top half?
Is it to get some into the truly, truly excellent and keep
them there category? So does that help pull the others up?
It is the jack-in-the-box issue that the Chairman
has been talking about. But sometimes it is good to get
someone on a straight SALP 1. Then you really have a
benchmark right there and, you know, you can get them all
clearly into the top half in our regime and many of them in
the top quartile.
It seems like to me that the utilities that
succeed, a lot of them, are in this virtuous space where
they are both low cost and high safety and everything
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is -- all the engines are clicking and it would be
delightful if ComEd someday were in that class with their
enduring plants.
CHAIRMAN JACKSON: It depends on ComEd.
Are there any closing comments? If not, I would
like to thank the Commonwealth Edison representatives for
briefing the Commission regarding ongoing activities to
improve safety performance at its nuclear stations and I
would also like to thank the NRC staff for providing a good
overall assessment, their assessment of the Commonwealth
Edison response and its strategy for the assessment of
Commonwealth Edison performance.
Commonwealth Edison's response to the Commission
request for information was broadly based and the staff
believes, as presented to us, provided a reasonable set of
actions and satisfied the request for information contained
in the 50.54(f) letter. And the strategy to improve
performance that Commonwealth Edison has outlined appears to
be sound.
However, as all of us have said, actions in the
end will speak louder than words and one of the most
important factors in maintaining the Commission's confidence
in Commonwealth Edison's ability to operate the six nuclear
sites will be in assuring the effective, as you have
indicated, implementation of the actions and programs
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described in their response and, as such, the Commission and
the Staff will continue to maintain an active interest in
Commonwealth Edison's activities and as such we would expect
to hear from you on a regularized basis.
Unless there are any further comments, we are
adjourned.
[Whereupon, at 12:55 p.m., the public meeting was
concluded.]
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