January 3, 2007

EA-06-178

Nuclear Management Company, LLC

 ATTN: Douglas E. Cooper

Senior Vice President & Chief Nuclear Officer

700 1st Street

Hudson, WI 54016-9894

SUBJECT: CONFIRMATORY ORDER (EFFECTIVELY IMMEDIATELY)

(OFFICE OF INVESTIGATION REPORT NO. 3-2005-010)

Dear Mr. Cooper:

The enclosed Confirmatory Order is being issued to the Nuclear Management Company, LLC

(NMC) as part of a settlement agreement between NMC and the U.S. Nuclear Regulatory

Commission (NRC) regarding an apparent violation of 10 CFR 50.7, “Employee protection,”

issued by the NRC to NMC, dated August 22, 2006.

In its August 22, 2006, letter, the NRC provided NMC with the results of an investigation

completed by the NRC’s Office of Investigations (OI) (OI Report No. 3-2005-010). The purpose

of the investigation was to determine whether a senior reactor operator (SRO) was the subject

of employment discrimination for raising a nuclear safety concern in a corrective action program

(CAP) report. Our letter noted that, based on the evidence developed during the investigation,

we concluded that the SRO was discriminated against, in part, for raising a concern in a CAP

report. 

In addition, our August 22, 2006, letter offered you a choice to: (1) attend a predecisional

enforcement conference, (2) provide a written response, or (3) request alternative dispute

resolution (ADR) with the NRC. In response, NMC requested ADR to resolve the apparent

violation of 10 CFR 50.7. An ADR mediation session was held on October 31, 2006, in 

Green Bay, Wisconsin, at which the parties entered into a settlement agreement. The terms

and conditions of that settlement agreement are set forth in Section IV of the enclosed

Confirmatory Order.

As part of settlement agreement, NMC agreed to take a number of actions, including: revising

its policy on writing CAP reports, training its supervisory employees on safety conscious work

environment (SCWE) principles, communicating its safety culture policy to its employees,

conducting a safety culture survey at the Point Beach Nuclear Plant (Point Beach) and

developing action plans to address significant issues identified as needing management

attention in the NMC 2004 and 2006 Comprehensive Cultural Assessments at Point Beach. In

recognition of these contemplated actions, the NRC agreed to cease pursuing further

enforcement action relating to the August 22, 2006, letter. We will, however, evaluate the

implementation of your commitments related to employee protection during future inspections.
D. Cooper -2-

We have enclosed a Confirmatory Order (Effective Immediately) to confirm the commitments

made as part of the settlement agreement. As evidenced by your signed “Consent and Hearing

Waiver Form (copy enclosed) dated December 20, 2006, you agreed to issuance of this letter

and Confirmatory Order.

Pursuant to Section 223 of the Atomic Energy Act of 1954, as amended, any person who

willfully violates, attempts to violate, or conspires to violate, any provision of this Order shall be

subject to criminal prosecution as set forth in that section. Violation of this Order may also

subject the person to civil monetary penalties.

You are not required to respond to this letter. However, if you choose to provide a response,

please provide it to me within 30 days at U.S. Nuclear Regulatory Commission, Mail Stop

O14E1, 11555 Rockville Pike, Rockville, MD 20852

Questions concerning this Confirmatory Order should be addressed to Russell Arrighi, NRC

Office of Enforcement, who can be reached at 301-415-0205 or via e-mail at rja1@nrc.gov.

A copy of this letter and its enclosures will be made available electronically for public inspection

in the NRC Public Document Room or from the NRC’s document system (ADAMS). ADAMS is

accessible from the NRC Web site at http://www.nrc.gov/reading-rm/adams.html. The NRC will

also include this letter, and its attached Confirmatory Order, on its website at www.nrc.gov;

select What We Do, Enforcement, Significant Enforcement Actions. Your response, if you

choose to provide one, will also be made available electronically for public inspection in the

NRC Public Document Room or from the NRC’s document system (ADAMS). 

Sincerely, 

/RA/

Cynthia A. Carpenter, Director

Office of Enforcement

Docket Nos. 50-263, 50-255, 50-266; 

 50-301, 50-282, 50-306

License Nos. DPR-22, DPR-20, DPR-24; 

 DPR-27, DPR-42, DPR-60

Enclosures: 

1. Confirmatory Order

2. Copy of Consent and Hearing Waiver Form dated December 20, 2006 

cc w/enclosures: (See attached list)
Attached List 1

Letter to Douglas E. Cooper - Dated: January 3, 2007

cc w/enclosures: M. Sellman, President and Chief Executive Officer

J. Rogoff, Vice President, Counsel & Secretary

F. Kuester, President and Chief

 Executive Officer, We Generation

C. Anderson, Senior Vice President, Group Operations

J. Cowan, Executive Vice President

 and Chief Nuclear Officer

R. Fenech, Senior Vice President, Nuclear

 Fossil and Hydro Operations

L. Lahti, Manager, Regulatory Affairs

J. McCarthy, Site Director of Operations

D. Weaver, Nuclear Asset Manager

D. Koehl, Site Vice President - Point Beach

T. Palmisano, Site Vice President - Prairie Island

P. Harden, Site Vice President - Palisades

J. Conway, Site Vice President - Monticello

Plant Manager, Point Beach

Training Manager, Point Beach

Site Assessment Manager, Point Beach

Site Engineering Director, Point Beach

Emergency Planning Manager, Point Beach

Regulatory Affairs Manager, Point Beach

Regulatory Affairs Manager, Prairie Island

Regulatory Affairs Manager, Monticello

Regulatory Affairs Manager, Palisades

K. Duveneck, Town Chairman

 Town of Two Creeks

Chairperson

 Public Service Commission of Wisconsin

J. Kitsembel, Electric Division

 Public Service Commission of Wisconsin

State Liaison Officer, Wisconsin

Tribal Council, Prairie Island Indian Community

Administrator, Goodhue County Courthouse

A. Udrys, Esquire, Consumers Energy Company

S. Wawro, Director of Nuclear Assets, Consumers Energy Company

Supervisor, Covert Township

Office of the Governor

State Liaison Office, State of Michigan

L. Brandon, Michigan Department of Environmental Quality -

 Waste and Hazardous Materials Division

M. Sellman, Chief Executive Officer

 and Chief Nuclear Officer

Manager, Nuclear Safety Assessment

Nuclear Asset Manager, Xcel Energy, Inc.

State Liaison Officer, Minnesota Department of Health
Attached List (Cont’d) 2

cc: w/enclosures: R. Nelson, President

 Minnesota Environmental Control Citizens

 Association (MECCA)

Commissioner, Minnesota Pollution Control Agency

D. Gruber, Auditor/Treasurer,

 Wright County Government Center

Commissioner, Minnesota Department of Commerce

Manager - Environmental Protection Division

 Minnesota Attorney General’s Office
D. Cooper -2-

We have enclosed a Confirmatory Order (Effective Immediately) to confirm the commitments

made as part of the settlement agreement. As evidenced by your signed “Consent and Hearing

Waiver Form (copy enclosed) dated December 20, 2006, you agreed to issuance of this letter

and Confirmatory Order.

Pursuant to Section 223 of the Atomic Energy Act of 1954, as amended, any person who

willfully violates, attempts to violate, or conspires to violate, any provision of this Order shall be

subject to criminal prosecution as set forth in that section. Violation of this Order may also

subject the person to civil monetary penalties.

You are not required to respond to this letter. However, if you choose to provide a response,

please provide it to me within 30 days at U.S. Nuclear Regulatory Commission, Mail Stop

O14E1, 11555 Rockville Pike, Rockville, MD 20852

Questions concerning this Confirmatory Order should be addressed to Russell Arrighi, NRC

Office of Enforcement, who can be reached at 301-415-0205 or via e-mail at rja1@nrc.gov.

A copy of this letter and its enclosures will be made available electronically for public inspection

in the NRC Public Document Room or from the NRC’s document system (ADAMS). ADAMS is

accessible from the NRC Web site at http://www.nrc.gov/reading-rm/adams.html. The NRC will

also include this letter, and its attached Confirmatory Order, on its website at www.nrc.gov;

select What We Do, Enforcement, Significant Enforcement Actions. Your response, if you

choose to provide one, will also be made available electronically for public inspection in the

NRC Public Document Room or from the NRC’s document system (ADAMS). 

Sincerely, 

/RA/

Cynthia A. Carpenter, Director

Office of Enforcement

Docket Nos. 50-263, 50-255, 50-266; 50-301, 50-282, 50-306

License Nos. DPR-22, DPR-20, DPR-24;DPR-27, DPR-42, DPR-60

Enclosures: 

1. Confirmatory Order

2. Copy of Consent and Hearing Waiver Form dated December 20, 2006

cc w/enclosures: (See attached list)

Distribution

ADAMS (PARS) SECY OCA C. Carpenter, OE

J. Luehman, OE R. Arrighi, OE L. Chandler, OGC J. Longo, OGC

L. Reyes, OEDO M. Virgilio, OEDMRS J. Craig, NRR B. Pascarelle, NRR

H. Bell, OIG G. Caputo, OI E. Hayden, OPA J. Caldwell, RIII

M. Satorius, RIII G. Shear, RIII R. Paul, RIII B. Berson, RIII

C. Lipa, RIII R. Skokowski, RIII R. Lickus, RIII J. Strasma, RIII:PA

P. Louden, RIII C. Weil, RIII P. Buckley, RIII DRPIII

DRSIII Enforcement Coordinators RI, RII, RIII, and RIV

RidsNrrDirsIrib OE r/f OEMAIL

OE WEB OE EA File Point Beach Senior Resident Inspector

Monticello Senior Resident Inspector Palisades Senior Resident Inspector

Monticello Senior Resident Inspector

X Publicly Available G Non-Publicly Available G Sensitive X Non-Sensitive

ADAMS- ML063630306

OE:ES OGC OE:D

RArrighi BJones CCarpenter

12/20/06 12/21/06 01/03/07

OFFICIAL RECORD COPY
[7590-01-P]

UNITED STATES OF AMERICA

NUCLEAR REGULATORY COMMISSION

In the Matter of

Nuclear Management Company ) Docket Nos.: 50-263, 50-255,

Monticello Nuclear Generating Plant ) 50-266; 50-301, 50-282, 50-306

Palisades Nuclear Power Plant ) License Nos.: DPR-22, DPR-20,

Point Beach Nuclear Plant Units 1 & 2 ) DPR-24; DPR-27, DPR-42, DPR-60

Prairie Island Nuclear Generating Plant Units 1 & 2 )

EA-06-178

CONFIRMATORY ORDER MODIFYING LICENSE

(EFFECTIVE IMMEDIATELY)

I

Nuclear Management Company, LLC (NMC or Licensee) is the holder of Facility Operating

License Nos. DPR-20, DPR-42, and DPR-60 and renewed Facility Operating License Nos.

DPR-22, DPR-24, and DPR-27 issued by the U.S. Nuclear Regulatory Commission (NRC or

Commission) pursuant to 10 CFR Part 50 on, February 21, 1991, April 5, 1974, October 29, 1974,

November 8, 2006, December 22, 2005, and December 22, 2005, respectively. The licenses

authorize the operation of Monticello Nuclear Generating Plant, Palisades Nuclear Power Plant,

Point Beach Nuclear Plant (PBNP), and Prairie Island Nuclear Generating Plant in accordance

with conditions specified therein. The facilities are located on the Licensee’s sites in Monticello,

Minnesota; South Haven, Michigan; Two Rivers, Wisconsin; and Red Wing, Minnesota.

II

On March 18, 2005, the NRC’s Office of Investigations (OI) began an investigation to determine

whether a senior reactor operator (SRO) at the PBNP was the subject of employment

discrimination in violation of 10 CFR 50.7, “Employee protection.” In OI Report No. 3-2005-010,

OI concluded that an SRO was discriminated against by PBNP management, in part, for raising

safety concerns using the Licensees’ corrective action program (CAP). By letter dated
-2-

August 22, 2006, the NRC identified to the Licensee an apparent violation of 10 C.F.R. 50.7,

and offered NMC the opportunity to provide a written response, attend a predecisional

enforcement conference, or to request alternative dispute resolution (ADR) in which a neutral

mediator with no decision-making authority would facilitate discussions between the NRC and

NMC and, if possible, assist the NRC and NMC in reaching an agreement. NMC chose to

participate in ADR. On October 31, 2006, the NRC and NMC met in Green Bay, Wisconsin, in

an ADR session mediated by a professional mediator, arranged through Cornell University’s

Institute on Conflict Resolution.

III

This Confirmatory Order is issued pursuant to the agreement reached during the ADR process. 

Specifically, NMC agreed to the following:

1. By no later than nine (9) months after the issuance of this Confirmatory Order, NMC

agrees to review, revise, and communicate to NMC employees and managers its policy

relating to the writing of corrective action program (CAP) reports, and provide training to

NMC employees and managers to clarify management’s expectation regarding the use of

the program with the goal to ensure employees are not discouraged, or otherwise

retaliated or perceived to be retaliated against, for using the CAP.

2. By no later than June 30, 2007, NMC agrees to communicate its safety culture policy

(including safety conscious work environment (SCWE)) to NMC employees, providing

employees with the opportunity to ask questions in a live forum.
-3-

3. By no later than nine (9) months after the issuance of this Confirmatory Order, NMC

agrees to train its employees holding supervisory positions and higher who have not had

formal training on SCWE principles within the previous two years of the Confirmatory

Order. NMC agrees to use a qualified training instructor (internal or external) for such

training.

NMC shall review and enhance, if necessary, its refresher SCWE training consistent with

NMC’s refresher training program and provide such refresher training to its employees. 

New employees holding supervisory positions and higher shall be trained on SCWE

principles within nine (9) months of their hire dates unless within the previous two years of

their hire dates, they’ve had the same or equivalent SCWE training.

4. By no later than March 30, 2007, NMC agrees: to develop action plans to address

significant issues identified as needing management attention in the NMC 2004 and 2006

Comprehensive Cultural Assessments at PBNP; to conduct focus group interviews with

Priority 1 & 2 organizations to understand the cause of the survey results; and to review

and, as appropriate, reflect nuclear industry best practices in its conduct of focus groups

and action plans to address the issues at PBNP.

NMC has agreed that this Confirmatory Order shall include the commitments noted above, and

NRC has agreed it will not pursue any further enforcement action for this issue and will not

count this matter as previous enforcement for the purposes of assessing potential future

enforcement action civil penalty assessments in accordance with Section VI.C of the

Enforcement Policy.
-4-

On December 20, 2006, NMC consented to the NRC issuing this Confirmatory Order with the

commitments, as described in Section IV, below. NMC further agreed in its December 20,

2006, letter that this Confirmatory Order is to be effective upon issuance and that it has waived

its right to a hearing. The NRC has concluded that its concerns can be resolved through

issuance of this Order.

I find that the Licensee’s commitments as set forth in Section IV are acceptable and necessary

and conclude that with these commitments the public health and safety are reasonably assured. 

In view of the foregoing, I have determined that the public health and safety require that the

Licensee's commitments be confirmed by this Confirmatory Order. Based on the above and the

Licensee’s consent, this Confirmatory Order is immediately effective upon issuance. NMC is

required to provide the NRC with a letter summarizing its actions when all of the Section IV

requirements have been completed.

IV

Accordingly, pursuant to Sections 103, 161b, 161i, 161o, 182, and 186 of the Atomic Energy

Act of 1954, as amended, and the Commission's regulations in 10 CFR 2.202 and

10 CFR Part 50, IT IS HEREBY ORDERED, EFFECTIVE IMMEDIATELY, THAT LICENSE

NOS. DPR-22, DPR-20, DPR-24, DPR-27, DPR-42 , AND DPR-60 ARE MODIFIED AS

FOLLOWS:

1. By no later than nine (9) months after the issuance of this Confirmatory Order, NMC shall

review, revise, and communicate to NMC employees and managers its policy relating to

the writing of corrective action program (CAP) reports, and provide training to NMC
-5-

employees and managers to clarify management’s expectation regarding the use of the

program with the goal to ensure employees are not discouraged, retaliated against, or

perceived to be retaliated against, for using the CAP.

2. By no later than June 30, 2007, NMC shall communicate its safety culture policy (including

safety conscious work environment (SCWE)) to NMC employees, providing employees

with the opportunity to ask questions in a live forum.

3. By no later than nine (9) months after the issuance of this Confirmatory Order, NMC shall

train its employees holding supervisory positions and higher who have not had formal

training on SCWE principles within the previous two years of the confirmatory order. NMC

agrees to use a qualified training instructor (internal or external) for such training.

NMC shall review and enhance, if necessary, its refresher SCWE training consistent with

NMC’s refresher training program and provide such refresher training to its employees. 

New employees holding supervisory positions and higher shall be trained on SCWE

principles within nine (9) months of their hire dates unless within the previous two years of

their hire dates, they’ve had the same or equivalent SCWE training.

4. By no later than March 30, 2007, NMC shall develop action plans to address significant

issues identified as needing management attention in the NMC 2004 and 2006

Comprehensive Cultural Assessments at PBNP; to conduct focus group interviews with

Priority 1 & 2 organizations to understand the cause of the survey results; and to review

and, as appropriate, reflect nuclear industry best practices in its conduct of focus groups

and action plans to address the issues at PBNP.
-6-

As part of the development of the action plans, NMC shall also assess and address any

legacy issues identified in prior safety culture assessments (i.e. CAP report AR00510074

and Synergy Safety Culture Assessment) that impact the safety culture at PBNP.

The executive summary, analysis, and contemplated action plans shall also be submitted

to the NRC.

5. By no later than December 31, 2008, NMC shall perform another survey at PBNP

comparable to the 2004 and 2006 surveys to assess trends of the safety culture at the site

and the overall effectiveness of corrective actions taken in response to prior year

assessments (i.e. CAP report AR00510074 and 2006 Synergy survey).

6. By no later than 3 months after the receipt of the next cultural survey results at PBNP,

NMC shall submit the executive summary, analysis of the results, and the contemplated

corrective actions to the NRC.

7. NMC shall continue to implement a process which ensures that adverse employment

actions are in compliance with NRC employee protection regulations and principles of

SCWE.

8. In the event of the transfer of the operating license of any NMC operated facility to

another entity, the commitments shall survive for the NMC fleet generally and PBNP

specifically.
-7-

9. Any reference to NMC employees includes all NMC employees fleet wide. The Director,

Office of Enforcement, may relax or rescind, in writing, any of the above conditions upon a

showing by the Licensee of good cause.

V

Any person adversely affected by this Confirmatory Order, other than the Licensee, may

request a hearing within 20 days of its issuance. Where good cause is shown, consideration

will be given to extending the time to request a hearing. A request for extension of time must

be made in writing to the Director, Office of Enforcement, U.S. Nuclear Regulatory Commission, 

Washington, DC 20555, and include a statement of good cause for the extension. Any request

for a hearing shall be submitted to the Secretary, U.S. Nuclear Regulatory Commission,

ATTN: Rulemakings and Adjudications Staff, Washington, DC 20555. Copies also shall be sent

to the Director, Office of Enforcement, U.S. Nuclear Regulatory Commission, Washington,

DC 20555, to the Assistant General Counsel for Materials Litigation and Enforcement at the

same address, to the Regional Administrator, NRC Region III, 2443 Warrenville Road,

Suite 210, Lisle, IL 60532-4352, and to the Licensee. Because of potential disruptions in

delivery of mail to United States Government offices, it is requested that requests for hearing

be transmitted to the Secretary of the Commission either by means of facsimile transmission to

301-415-1101 or by e-mail to hearingdocket@nrc.gov and also to the Office of the General

Counsel either by means of facsimile transmission to 301-415-3725 or by e-mail to

OGCMailCenter@nrc.gov. If a person requests a hearing, that person shall set forth with

particularity the manner in which his interest is adversely affected by this Order and shall

address the criteria set forth in 10 CFR § 2.309(d) and (f).
-8-

If the hearing is requested by a person whose interest is adversely affected, the Commission

will issue an Order designating the time and place of any hearing. If a hearing is held, the issue

to be considered at such hearing shall be whether this Confirmatory Order should be sustained. 

In the absence of any request for hearing, or written approval of an extension of time in which

to request a hearing, the provisions specified in Section IV shall be final 20 days from the date

of this Order without further order or proceedings. If an extension of times for requesting a

hearing has been approved, the provisions specified in Section IV shall be final when the

extension expires if a hearing request has not been received. A REQUEST FOR HEARING

SHALL NOT STAY THE IMMEDIATE EFFECTIVENESS OF THIS ORDER.

 FOR THE NUCLEAR REGULATORY COMMISSION 

/RA/

Cynthia A. Carpenter, Director

Office of Enforcement 

Dated this 3rd day of January, 2007
Enclosure 2

(ML063540433)