1 

UNITED STATES OF AMERICA 

NUCLEAR REGULATORY COMMISSION 

+ + + + + 

BRIEFING ON RESULTS OF THE AGENCY ACTION REVIEW PLAN 

MEETING (AARM) 

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THURSDAY 

MAY 21, 2015 

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The public meeting was convened in the 

Commissioners' Hearing Room, One White Flint, 11555 Rockville Pike, 

Rockville, Maryland, at 9:00 a.m., Stephen G. Burns, Chairman, 

presiding. 

COMMISSIONERS PRESENT: 

STEPHEN G. BURNS, Chairman 

KRISTINE L. SVINICKI 

WILLIAM P. OSTENDORFF 

JEFF BARAN 
 2 

STAFF PRESENT: 

MARC DAPAS, Regional Administrator, Region IV 

MARGARET M. DOANE, ESQ., NRC General Counsel 

LAURA DUDES, Director, Division of Material Safety, State, 

Tribal, and Rulemaking 

Programs, NMSS 

SCOTT MORRIS, Director, Division of Inspection and Regional 

Support, NRR 

MARK A. SATORIUS, Executive Director for 

Operations, NRC 

ANNETTE L. VIETTI-COOK, Secretary of the 

Commission 

ALSO PRESENT: 

JEREMY BROWNING, Vice President of Operations, 

Arkansas Nuclear One 

JOSEPH A. KOWALEWSKI, Chief Operating Officer, Southern 

Fleet, Entergy 

JOHN MCCANN, Vice President, Regulatory Affairs, Entergy 

TIMOTHY G. MITCHELL, Senior Vice President, Nuclear 

Operations, Entergy 
 3 

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

2 8:58 a.m. 

3 CHAIRMAN BURNS: Thank you. I'll ask the staff to 

4 come to the table, as we prepare for our briefing on the results of the 

5 Agency Action Review Meeting. Okay, the focus of today's meeting is 

6 on the results of the NRC's Agency Action Review Meeting, or AARM. 

7 We'll also hear from Entergy regarding their action plan for the 

8 Arkansas Nuclear One facility, which recently transitioned to the 

9 multiple repetitive degraded cornerstone column of the Reactor 

10 Oversight Process Action Matrix, also known as Column Four. And 

11 we'll begin this morning with discussion from the NRC staff panel, Mark 

12 Sartorius, Laura Dudes, Scott Morris and Marc Dapas, and following 

13 the staff panel we'll have a brief break, and then we'll hear from 

14 Entergy. And I look forward to today's discussion. Do my fellow 

15 commissioners have any opening comments? Okay Marc, please 

16 begin. 

17 MR. SATORIUS: Good morning, Chairman. Good 

18 morning Commissioners. The staff is here today to present the results 

19 of the Agency Action Review Meeting that we performed about a month 

20 ago, April 15th. Before I turn the presentation over to my colleagues, 

21 I'd like to take a moment to highlight some of the objectives of the 

22 Agency Action Review Meeting, or the AARM. The AARM is a 

23 meeting of the senior leadership of the agency, and its goals are to 
 4 

1 review the appropriateness of agency actions taken for reactor material 

2 licensees with significant performance issues. Also, to ensure that 

3 coordinated courses of actions are developed and implemented for 

4 licensees of concern. We review the results through the staff 

5 self-assessments of the reactor oversight process and the construction 

6 reactor oversight process, and lastly, we ensure that the trends in 

7 industry and licensee performance are recognized and appropriately 

8 addressed. So given the significance of the subject matter, we 

9 consider this to be one of our most important meetings that we hold at 

10 the senior staff level. Next slide, please. 

11 Joining me today are to my far right, Laura Dudes, the 

12 Director of the Division of Materials Safety, State, Tribal and 

13 Rulemaking Programs in the Office of Nuclear Materials Safety and 

14 Safeguards. To my immediate right, Scott Morris, the Director of the 

15 Division of Inspection and Regional Support in the Office of Nuclear 

16 Reactor Regulation. And to my left, Marc Dapas, the Region IV 

17 Regional Administrator. Next slide, please. During today's 

18 presentation, we'll go into detail regarding the staff's AARM discussions 

19 on nuclear materials and waste, program trends and licensee 

20 performance, reactor program trends and licensee performance, 

21 including ongoing efforts to enhance the reactor oversight process and 

22 discuss two licensees with performance issues, Fort Calhoun and 

23 Arkansas Nuclear One. 

24 I also wanted to highlight two topics which were 

25 discussed by the senior leadership at the AARM, but we are not 

26 presenting in detail at this meeting today. The first is the results of the 
 5 

1 Annual Reactor Construction Program Self-Assessment. The staff will 

2 discuss the construction assessment in more detail during the New 

3 Reactors Business Line; the Commission meeting is planned for this 

4 fall. The second discussion that we had at the AARM that we will not 

5 be covering in any sense of detail is a discussion of the performance of 

6 the reactor licensee at Browns Ferry. 

7 Browns Ferry met the criteria for discussion at the 

8 AARM by having spent time in Column Four of the Action Matrix during 

9 calendar year 2014; however, given the level of engagement the 

10 Commission has had with Browns Ferry over the past several years 

11 and their transition back into Column One of the Action Matrix in 

12 October of 2014, the staff felt that today's time is best spent on more 

13 current issues. If the Commission has any questions on the 

14 construction self-assessment or Browns Ferry's performance, we'll be 

15 happy to deal with those in the question and answer period. So now 

16 I'm going to ask Laura to begin our presentation with a discussion of 

17 nuclear materials and waste program performance. Laura. 

18 MS. DUDES: Thank you, Marc. Good morning 

19 Chairman, Commissioners. The National Materials Program includes 

20 nearly 22,000 NRC and agreement state licensees that use nuclear 

21 materials in a wide variety of beneficial applications, including 

22 industrial, research, academic, medical and fuel cycle facilities. The 

23 NRC's 2014 Performance and Accountability Report estimates nearly 

24 112 million nuclear medicine procedures are performed annually; the 

25 vast majority of these in the diagnostic arena. But when we discuss 

26 trending in the next few slides, I'd like to just point out that the number of 
 6 

1 reported events is small compared to the total number of activities 

2 carried out in the United States. That being said, the staff does 

3 monitor the data and continues to look for performance issues or things 

4 that would warrant NRC response, communication or program 

5 changes. So today, I plan to highlight some of the issues we 

6 addressed this year as part of the National Materials Program. Next 

7 slide, please. 

8 The National Materials Program is protecting public 

9 health and safety. We continue to focus on new challenges that may 

10 warrant program enhancements or changes. In April of this year, the 

11 Commission met with several of our key partners in this program: The 

12 Organization of Agreement States, the Conference of Radiation Control 

13 Program Directors, and the Advisory Committee on Medical Uses of 

14 Isotopes. The map on the center of this slide represents the National 

15 Materials Program and the unique and valuable relationship we have 

16 with the states. Over the next few years, we do expect that we may 

17 add one or more new agreement state partners to the program, and so 

18 we want to focus on making sure we can continue to provide effective 

19 communications and training across the nation. So for example, this 

20 year, in addition to the formal training that we provide as part of the 

21 technical training center, and I know they're doing work on more 

22 blended learning and electronic delivery mechanisms, the staff 

23 delivered a series of webinars on medical issues, including medical 

24 event reporting, to enhance knowledge transfer and promote 

25 consistency in licensing, inspection and event reporting across the 

26 United States. 
 7 

1 The photos on the left hand side of this slide represent 

2 the individual access control and security monitoring requirements put 

3 in place in March 2014 by our Part 37 Source Security Rulemaking. 

4 We continue to work with the states as they transition from increased 

5 control orders or other binding requirements they put into place after 

6 9/11, and they will transition to full implementation of the Part 37 Rule in 

7 March 2016. In addition, the staff is executing a comprehensive 

8 assessment of the new Part 37 Rule to assure that it provides adequate 

9 protection of the nation's radioactive sources. 

10 The photos to the right include brachytherapy 

11 treatment and the ViewRay system, two medical therapy procedures 

12 that can have a substantial, positive impact on the lives of cancer 

13 patients. The staff works closely with the Advisory Committee on 

14 Medical Uses of Isotopes to assure early engagement on new 

15 technologies, new treatments, and diagnostic therapies such that our 

16 regulations are protective and yet do not impact the practice of 

17 medicine. The photo of the radiography camera and the moisture 

18 density gauge represent some of the many industrial sources that are 

19 regulated by the National Materials Program. 

20 During fiscal year '14 performance year, we had 

21 several radiographer overexposure events or potentially significant 

22 overexposure events that occurred both in agreement states and under 

23 NRC jurisdiction. The staff was able to leverage our very strong 

24 relationship with the states to openly share the events, root causes, and 

25 details of our regulatory actions such that--and then provide this to all of 

26 the partners in the National Material Program so they could share that 
 8 

1 with licensees and re-emphasize the importance of personnel safety in 

2 this industrial practice. Next slide, please. 

3 Similar to the reactor oversight process, the NRC and 

4 the Agreement State Materials Programs include licensing, inspection 

5 and enforcement. We also collect, monitor and evaluate operational 

6 data on an ongoing basis as part of our event reporting function. Our 

7 evaluation process includes identification of significant licensee 

8 performance issues and potential gaps or program issues in the NRC's 

9 programs that would warrant high level management attention at the 

10 Agency Action Review Meeting. Next slide, please. 

11 The staff uses the criteria and information sources 

12 listed on this slide to assess and measure our performance, including a 

13 graded approach from high level, high consequence events that include 

14 our strategic goals and performance measures and are reported to 

15 Congress to lower threshold event reporting and also enforcement 

16 trends that are reported only within the NRC. All of this information is 

17 not only reviewed sometimes on a daily basis as in our event reports, 

18 but at various times through the year and rolled up and fully discussed 

19 as part of the Agency Action Review Meeting. Next slide, please. 

20 During fiscal year '14, the reporting period, there were 

21 524 NRC and agreement state reports reported in the Nuclear Material 

22 Events Database. To account for random fluctuations in event data 

23 from year to year, the annual report reviews data for the last 10 fiscal 

24 years as depicted on this graph. To give you a sense of comparison, 

25 the fiscal year '14 10-year data was 5,650 events; the fiscal year '13 

26 data was 5,634. So the staff does not have any statistically significant 
 9 

1 trends in the overall data. Staff sometimes looks at narrow parts of the 

2 data to look for sensitivities or trends; there is a continued decrease in 

3 NRC licensee event reports and a slight increase in the agreement 

4 state reports, which is to be expected as we had three moderate-sized 

5 programs transition in this 10-year period. 

6 I have to apologize to Commissioners Svinicki and 

7 Ostendorff because you've probably been hearing this for several years 

8 in a row. It will be new for you, but you'll hear it for five years after this. 

9 The spike in 2008 and 2009, which skews the graph and may skew the 

10 data, is actually a one-time event where WalMart was inventorying a set 

11 of tritium exit signs, and so there was 272 events reported in 2008, 

12 another 65 in 2009, and it sort of shifts that graph or the appearance of 

13 that graph. But more seriously, within the Nuclear Materials Events 

14 Database, some do meet the abnormal occurrence thresholds and are 

15 reported to Congress. This year, we had 13 abnormal occurrences; 12 

16 were in agreement states; one was an NRC licensee. All 13 involved 

17 medical procedures and reported to the Commission in SECY-15-0029. 

18 Next slide, please. 

19 In summary, there were no fuel cycle facilities or 

20 materials licensees that met the Agency Action Review Meeting 

21 discussion criteria. The Nuclear Materials Program met all strategic, 

22 performance, safety and security metrics and identified no significant 

23 trending or programmatic issues. Thank you for your attention; I will 

24 now turn it over to my colleague, Scott Morris. 

25 MR. MORRIS: Thank you, Laura. Good morning Mr. 

26 Chairman, Commissioners. Over the next 15 to 20 minutes or so, I'm 
 10 

1 going to summarize some of the key reactor program related matters 

2 that we discussed at the April Agency Action Review Meeting. Next 

3 slide, please. Specifically, I intend to focus my discussion on the 

4 industry trends program results from 2014, next I'll spend some time 

5 explaining what we've been doing with respect to the Reactor Oversight 

6 Process enhancement efforts, and finally I'll describe our planned 

7 changes to our self-assessment, our annual Self-Assessment Program 

8 process associated with the Reactor Oversight Program. Next slide, 

9 please. 

10 The Industry Trends Program complements the 

11 Reactor Oversight Process and is designed to assess overall industry 

12 performance using industry-level indicators. It includes a total of 32 

13 different indicators looking at multiple aspects of industry safety 

14 performance. Any adverse trends identified as a result of reviewing 

15 those indicators are analyzed for causal factors, and this information is 

16 also used to update our licensing and oversight programs as 

17 applicable. The results are also used to--as an input to our strategic 

18 performance goal measures and are communicated to our 

19 Congressional oversight committees. In summary, no adverse trends 

20 were identified in fiscal year 2014, no short-term prediction limits were 

21 exceeded, and no long-term statistically significant adverse trends were 

22 realized. Next slide, please. 

23 As an example, this slide shows one of our long-term 

24 indicators as part of the Industry Trends Program. This one happens 

25 to be significant events, which are analyzed on a 10-year rolling basis. 

26 Specifically, it assesses significant events per reactor unit by fiscal 
 11 

1 year, and a significant event is defined as a yellow or a red input, an 

2 input being an inspection finding or a performance indicator as part of 

3 the Reactor Oversight Process. An event that is rated at the 

4 International Nuclear Events Scale a rating of two or higher; abnormal 

5 occurrences as identified are defined by Management Directive 8.1 or 

6 an event that has a conditional--an increase in conditional core damage 

7 probability of one times ten to the minus fifth. A comprehensive 

8 summary of all the indicators, all 32 indicators and the staff's 

9 assessment are included in SECY-15-0061. Next slide, please. 

10 While the results of the Industry Trends Program have 

11 provided confidence in overall industry safety performance over the 

12 years, historically these results have not been used as a basis to initiate 

13 specific agency actions or modifications to the Reactor Oversight 

14 Process. For this and other reasons, we're making changes to the 

15 Industry Trends Program going forward. A couple of changes we're 

16 trying to make in the inclusion of security and public radiation safety 

17 information; these two topics are currently not captured in the Industry 

18 Trends Program. In addition, we're planning to replace many of the 32 

19 what I'll call custom Industry Trends Program performance indicators 

20 with more readily available Reactor Oversight Program performance 

21 indicator data. This should reduce costs associated with data 

22 collection and analysis, but at the same time retain meaningful insights 

23 and overall industry performance. 

24 I should also--we also hope to reduce the time delays 

25 commonly associated with the analysis of complicated events. 

26 Sometimes the abnormal occurrences and other complicated events 
 12 

1 get assessed by the Office of Nuclear Reactor Research through a very 

2 detailed, comprehensive process, and it takes a lot of time to get an 

3 outcome from that. We're hoping to minimize that. And finally, we 

4 want to make the Industry Trends Program more accessible to public 

5 stakeholders and more understandable and more closely aligned with 

6 ROP cornerstones. Next slide, please. 

7 I'd now like to turn attention to the Reactor Oversight 

8 Program enhancement activities. First, I want to state that we believe 

9 and stakeholders agree that the ROP, the Reactor Oversight Process is 

10 a very mature and highly effective oversight program. That being said, 

11 however, over the last couple of years, there have been numerous 

12 opportunities for us to receive input feedback on how to maximize the 

13 efficiency and effectiveness of the program. In fact, we've received 

14 over 130 specific, discrete recommendations from multiple sources, 

15 including our own self-initiated baseline inspection program 

16 enhancement project, the ROP independent assessment that was 

17 initiated in 2013 and completed in 2014, a self-initiated business 

18 process improvement initiative that focused on the significance 

19 determination process, various audits that we've received from the 

20 Office of Inspector General and the Government Accountability Office, 

21 detailed lessons learned reports that we've conducted following the Fort 

22 Calhoun 0350 Process Implementation, Browns Ferry being in Column 

23 Four, and also the San Onofre Nuclear Generating Station lessons 

24 learned. Those things, in addition to our ongoing annual ROP 

25 self-assessment and our routine inspector feedback forms, which we 

26 received many dozens of over the course of a given year. 
 13 

1 So we took all of those inputs early last year and sorted 

2 and prioritized them according to a rubric that contained multiple 

3 factors, which I can explain later if you have a question about how we 

4 do that. But generally speaking, of the 130 items, we're working the 

5 highest priority ones first, and the highest priority ones tend to be the 

6 most challenging and difficult ones, and I'll explain some of those in 

7 more detail in a minute. Our intent is to complete the bulk of these 

8 enhancement-related activities by the end of this calendar year, 

9 although there will be some notable exceptions. Next slide, please. 

10 First, let me talk about the Baseline Inspection 

11 Program Enhancement Project. As I mentioned, it was self-initiated 

12 two years ago, an NRC wide working group effort. We had folks from 

13 Regions and Headquarters, multiple meetings with external 

14 stakeholders, public industry, et cetera. It was a holistic review, the full 

15 suite of baseline inspection procedures. And by baseline inspection 

16 procedures, we mean those inspections that are conducted at every 

17 site every cycle, regardless of site or unit performance. We published 

18 a report in early 2014 which is publicly available. The substantial 

19 revisions that were identified included changes to the Problem 

20 Identification Resolution Inspection, a very important inspection which 

21 underpins the foundation of the Reactor Oversight Process, the 

22 Component Design Basis inspection, and also notably the 

23 Independent Spent Fuel Storage Installation inspections, which were 

24 recommended and are being moved under the Reactor Oversight 

25 Process, which required the development of a Significance 

26 Determination Process to ensure that any inspection findings that were 
 14 

1 identified as a consequence of implementing that inspection could be 

2 rolled into the action matrix as appropriate. 

3 And finally, under the Baseline Inspection Program, we 

4 are addressing what we're considering a significant recommendation 

5 from the Government Accountability Office in which they noted that the 

6 NRC, and particularly in the regional implementation of the oversight 

7 program as it pertains to findings of low or very low significance, that 

8 there were some significant differences in the way that the inspectors 

9 of the regions that implemented the program. The recommendation 

10 was that the staff go back and take a hard look at why that is, and we 

11 did that. 

12 We had a number of--a couple of table top exercises 

13 and published a detailed, analytical report on the causes late last year, 

14 and the fundamental primary cause essentially was the amount of 

15 ambiguity in some of the inspection program governance documents 

16 associated with the treatment of low significance findings. And I can 

17 explain that in more detail if that's an item of interest, but I will point out 

18 one example, which is how inspectors determine whether an issue or a 

19 performance deficiency meets the criteria for--is minor or more than 

20 minor such that we would then enter the next stage of the process, and 

21 there was some ambiguity in how to make those interpretations. Next 

22 slide, please. 

23 Moving to the assessment program, the licensee 

24 performance assessment, we made significant progress in two major 

25 areas; in fact, the first area we've completed, and I should note also that 

26 these efforts were also conducted through the use of industry-wide 
 15 

1 working groups and public meetings. The first one is the substantive 

2 cross-cutting issue process, which now we term simply the cross 

3 cutting issue process. Essentially what we've done here is we've 

4 adjusted the thresholds for what constitutes a cross cutting issue, and 

5 in part to ensure consistent agency action and response to an identified 

6 cross-cutting issue. This was a difficult and challenging process, a lot 

7 of good interaction with the industry but ultimately we aligned on what 

8 we think is the appropriate set of thresholds for determining when there 

9 is a cross-cutting theme and one the agency should begin more 

10 aggressive action with a licensee. We plan to reassess this entire 

11 process after a few assessment cycles to make sure that the intent of 

12 the changes are actually being realized, so we're going to give it some 

13 run time and see how it works out, but we think it's 'a good change. 

14 The second major area under the assessment 

15 program is we're, you're probably aware, taking a very hard look and 

16 have prepared a Commission vote paper, which you should receive in 

17 the next few weeks, looking at the definition of what a degraded 

18 cornerstone is, and more specifically, how that factors into a licensee 

19 transition criteria to move from what we would Column Two to Column 

20 Three, or regulatory response column to the degraded cornerstone 

21 column. If approved, the current process or the current definition of a 

22 degraded cornerstone is two white inputs or one yellow input. We 

23 have done a qualitative and risk-based assessment and essentially 

24 concluded that it would be appropriate to change the criteria for 

25 degraded cornerstone from two white inputs to three white inputs, 

26 which clearly would have some impact and could be perceived as a 
 16 

1 reduction in regulatory oversight. It would also notably change the 

2 criteria for Column Four because Column Four is the degraded or 

3 repetitive degraded cornerstones. 

4 The SECY paper that you should be receiving here 

5 shortly will present the basis for the staff's recommendation, again both 

6 a risk-based and a qualitative set of factors that were used, but it will 

7 also provide a description of some alternative views that the staff has. 

8 Suffice it to say there was not 100 percent alignment on the approach 

9 that we should take with respect to this recommendation, and the paper 

10 will go into some detail as to why some staff believe that maintaining the 

11 status quo is appropriate. But if the Commission does approve the 

12 staff's recommendation, we will then begin an implementation--we'll 

13 develop an implementation strategy to deal with transitional issues. 

14 For example, if a licensee is in Column Three right now because of two 

15 whites, and we change, what does that mean? Do we grandfather, 

16 that type of thing. Next slide, please. 

17 Turning now to the Significance Determination 

18 Process, this is a--I'm going to spend two slides on this. This is a very 

19 important effort, we've broken it into two phases. Phase 1 is 

20 essentially the result of a staff initiated, self-initiated Business Process 

21 Improvement initiative that we completed in early 2014, but it really 

22 looks at the existing process as defined in the inspection manual. The 

23 goal of the effort was to, quite simply, improve the process efficiency 

24 and effectiveness, including timeliness, and the publicly available report 

25 lists 14 specific efficiency and effectiveness recommendations, all of 

26 which are being implemented. 
 17 

1 I believe 11 of them now are completed, there's a few 

2 left to be done, but essentially it will improve coordination between the 

3 Regional and Headquarters analytical staff, it will reinforce 

4 management expectations for the timeliness of the conduct of risk 

5 analyses, including a new timeliness metric that will be based not on 

6 when the NRC completes its exit meeting until the time we issue a 

7 preliminary determination, but rather the time from when the issues was 

8 first identified to when we issue, and that we believe will provide a more 

9 meaningful assessment of the work that we're doing to improve the 

10 efficiency. 

11 It will also include some enhanced training for the 

12 senior executives that sit on the panels that make the final decision, 

13 preliminary and final decisions about the significance of findings, 

14 particularly to enhance their level of understanding and appreciation of 

15 risk concepts, the degree of uncertainty in the model, the types of 

16 assumptions that are being made in the various events. We're 

17 confident that these changes will result in a more timely issuance of 

18 preliminary significance determination letters to licensees, also known 

19 as choice letters. We expect that the--or we believe that this Phase 1 

20 Significance Determination Process effort will be fully responsive to the 

21 Commission's direction in COMSECY-14-0030 to "streamline the SDP" 

22 and we will, by the end of June, we will provide a summary of our 

23 completed actions with respect to Phase 1, but also our planned actions 

24 moving forward with Phase 2, which I'll discuss on the next slide. Next 

25 slide, please. 

26 So as a supplement to the Phase 1 efforts, we've just 
 18 

1 begun a broader, longer term effort, longer term meaning the next year 

2 to two years, to review the efficacy of the SDP on a more fundamental 

3 or even philosophical level, and we call this Phase 2. The goal of 

4 Phase 2 is to identify even more efficient means to employ an 

5 integrated, risk-informed decision making principles. And the point of 

6 that is to even more further improve SDP time limits, make better use of 

7 agency and licensee resources, and to add additional clarity to the 

8 process and ideally, enhance the predictability of outcomes at the same 

9 time. So the current process, the current Significance Determination 

10 Process, at least as it pertains to the reactor safety strategic 

11 performance area, which includes initiating events, barrier integrity, 

12 mitigating systems, relies very heavily on PRA models, and it creates 

13 some inherent challenges, quite frankly. 

14 For example, the models that we use are based on 

15 essentially full -operations, but not every finding is based on--you know, 

16 some of them are shutdown, some of them are in transition or low 

17 power or intermediate, so the models don't necessarily effectively or 

18 adequately model existing--what's happening. And models are full 

19 of--they're not perfect, right? I mean there's always inherent parts of 

20 the model that don't accurately reflect reality. Now there are other 

21 challenges like associating or estimating initiating event frequencies, 

22 like if you have a finding that would only be an issue if there was some 

23 type of weather event, say flooding or hurricanes. So estimating 

24 initiating event frequencies or degree of rainfall, it becomes very 

25 challenging, and there are frankly some scenarios which just aren't 

26 modeled, and so it takes time to develop a model after a performance 
 19 

1 deficiency is identified. 

2 So the integrated, what we're calling Phase 2 or this 

3 more integrated, risk-informed SDP decision making approach would 

4 more fully consider the degree of uncertainty in PRA models and the 

5 need for critical assumptions at the outset, and then look at, depending 

6 on that, look at the plant equipment, safety/design margin associated 

7 with plant mitigating equipment, defense and depth, even regulatory 

8 compliance or any other number of potentially more qualitative factors. 

9 So again, we're just beginning this, it's going to involve--we're going to 

10 need to take a hard look at the SDP basis documents, we'll likely going 

11 to need to update our decision-making tools, we'll have to establish 

12 some ground rules for how this whole thing is going to work with respect 

13 to process mechanics like how long we wait to get clarity from the 

14 licensee on what the root cause or apparent cause is, et cetera. Of 

15 course we'll seek input from all of our internal and stakeholder inputs 

16 along the way, and we'll keep the Commission informed. Next slide, 

17 please. 

18 My last example of ROP enhancement related 

19 activities that I'll discuss this morning and that was discussed at the 

20 AARM in April has to do with reactor oversight project or program 

21 related communication activities. Both internal and external 

22 communications mechanisms were examined; consistent with other 

23 plain language initiatives, we're really taking a hard look at our process 

24 and the outcomes of our process and the descriptions of our process 

25 and what's available in the public domain to ensure that we're 

26 maximizing or making best use of plain language. We're not there yet. 
 20 

1 I looked at an inspection report we published a year or two ago at a site 

2 I won't mention and looking at the executive summary, and it's still is full 

3 of acronyms and jargon and if I were a member of the public, I would 

4 have a hard time, frankly, reading it. So we've got some work to do on, 

5 you know, improving active voice, minimizing jargon, making things 

6 more concise, even proper grammar, and there are things we can do in 

7 our inspection program manual specifically associated with inspection 

8 reports to add plain language. 

9 Also, we're re-engineering our external website, 

10 providing better search tools, inspection report search tools, internal 

11 website actions, we're updating our ROP related brochures, and we're 

12 providing--including an extensive set of questions and answers, 

13 FAQ-type thing. We're also looking to be using some outside contract 

14 help to take a look at--do an independent look at our ROP-related 

15 documents and have them give us some critical feedback on what we 

16 can do better on. Next slide, please. 

17 Let me last now turn to the Reactor Oversight Program 

18 Self-Assessment Process. This is an annual self-assessment, but 

19 you'll recall that we requested in COM 14-0030 last year, we requested 

20 that we forego last year's self-assessment, principally to number one, 

21 re-engineer the whole process to begin with, the self-assessment 

22 process, but just as important, to give the staff--free up some resources 

23 to work on all these ROP enhancement activities, some of which I just 

24 described. We took a blank slate approach to the self-assessment 

25 process, and I'll explain that here just in a moment. The ROP 

26 Self-Assessment Program governing documents are being revised 
 21 

1 now; we will implement the revised process this year and report the 

2 results next year, and again, we'll provide the Commission an update 

3 on the details of that after we've completed cleaning up all the formal 

4 documentation associated with how the program is going to work. 

5 But the new program essentially looks at three 

6 elements. One--and I should say the purpose, the main drivers for the 

7 new oversight self-assessment process is to add accountability, staff 

8 accountability to ensure--I mentioned the regional differences; it should 

9 help provide some accountability and feedback to ensure that we're 

10 tightening that up so that our oversight program is more reliable. But 

11 there are three basic elements to the new effort, which will include 

12 objective performance metrics using readily available information. 

13 The second element will be a very deliberate examination of recent 

14 changes made to the program to ensure that the intent is being 

15 realized, and the third piece of it is what I would call a deep dive effort 

16 into one or more specific aspects of the oversight program to go all the 

17 way to the root of the documents and make sure it still makes sense 

18 and are we doing it the right way. Next slide, please. 

19 The current oversight program self-assessment 

20 currently includes three annual evaluations that are formally reported to 

21 the Commission, and each evaluation was Commission-directed at one 

22 point in the past. They include the Regulatory Impact Summary, which 

23 has been issued since 1992 to look at, in response to industry concerns 

24 about unnecessary regulatory burden being imposed on licensees by 

25 NRC inspectors and the oversight program in general. A second 

26 report has been issued since it was directed in 2008 and issued looking 
 22 

1 at the--issued annually looking at ROP resource expenditures, 

2 essentially that was because we had moved to the new oversight 

3 program, so there was clearly an interest in understanding the 

4 resources that were being dedicated to the process were, and finally a 

5 resident inspector demographics analysis. This was initiated in the 

6 late '90s out of a concern or an actual experience in which resident 

7 inspectors' experience was the time on site and their time as inspectors 

8 was declining. 

9 The staff believes that these analyses have outlived 

10 their usefulness as part of the annual oversight program 

11 self-assessment, principally because no recommendations for program 

12 improvements have resulted from these reports in many years; none of 

13 the analyses have been discussed substantively at recent AARMs; the 

14 costs associated with implementing given the benefits we're deriving is 

15 not evidence, and it's mainly the reporting aspect. And frankly, some 

16 of it is redundant to other things that we're doing in the agency. So I 

17 will point out that the data will still be collected, it's really a question of 

18 how much analytical work and reporting effort do we put into it. More 

19 rationale is provided in a COM that was just issued, 

20 COMSECY-15-0014. This concludes my remarks, and I'll now turn it 

21 over to Marc Dapas. Thank you. 

22 MR. DAPAS: Thank you, Scott. Good morning 

23 Chairman and Commissioners, I appreciate the opportunity to be here 

24 today and discuss with you our regulatory oversight activities with 

25 respect to Fort Calhoun Station and Arkansas Nuclear One. Let me 

26 begin with Fort Calhoun Station, where I plan to discuss the basis for 
 23 

1 our decision to return this facility to a normal level of NRC oversight. 

2 Next slide, please. By way of background, in December 2011, the 

3 NRC decided to transition Fort Calhoun Station from the Reactor 

4 Oversight Process or ROP, which is prescribed by Manual Chapter 

5 0305 to the Manual Chapter 0350 process for oversight of reactor 

6 facilities in a shutdown condition due to significant performance and/or 

7 operational concerns. 

8 The basis for the decision to transfer oversight from the 

9 ROP to the Manual Chapter 0350 process what that Fort Calhoun 

10 Station was shutdown and in the multiple repetitive degraded 

11 cornerstone column, or Column Four of the ROP action matrix, as well 

12 as the fact that the licensee needed to accomplish significant analysis 

13 of the extended condition and extended cause of known performance 

14 deficiencies to fully understand what recovery actions were necessary. 

15 Over the next two years, the licensee implemented extensive actions to 

16 identify and correct the many process, equipment and personnel 

17 problems that existed at the station. This included actions to improve 

18 the safety culture and safety conscious work environment. 

19 Then in September 2011, the NRC issued a 

20 confirmatory action letter, or CAL, and then issued revisions to the CAL 

21 in June 2012 and February 2013. These CALs documented the 460 

22 specific items or issues that needed to be resolved before restart. 

23 After expending more than 23,000 hours of increased regulatory 

24 oversight, the NRC completed its review of the 460 restart items. The 

25 extensive agency effort to independently verify that the licensee had 

26 adequately addressed all of the restart items culminated in the 0350 
 24 

1 Panel's recommendation to me that the plant was ready for restart. 

2 After completing my own due diligence, I closed the CAL on December 

3 13, 2013. Subsequently, Fort Calhoun Station operators commenced 

4 the reactor startup, and reached full power operation on December 26. 

5 To ensure the licensee continued to implement a number of long term 

6 corrective actions to prevent recurrence of a significant decline in 

7 performance, we issued a post-restart CAL on December 17, 2013, and 

8 that CAL contained about 160 items. The post-restart CAL addresses 

9 actions considered necessary for achieving and sustaining continued 

10 performance improvements in a number of areas. Next slide, please. 

11 Per Manual Chapter 0350, there are four overarching 

12 criteria that must be satisfied to terminate the 0350 process and return 

13 a plant to a normal level of regulatory oversight under the ROP. These 

14 criteria consist of verifying that the licensee has established an effective 

15 long-range improvement program; is sufficiently implementing its 

16 corrective action program; has demonstrated safe plant operation; and 

17 has adequate controls in place to address the plant-specific issues that 

18 caused the significant performance decline which led to invoking the 

19 0350 process. Next slide, please. 

20 With respect to the termination criterion of sufficient 

21 implementation of the Corrective Action Program, we conducted a team 

22 inspection in July 2014 to assess the licensee's Corrective Action 

23 Program effectiveness. The team identified concerns with the 

24 licensee's ability to effectively evaluate and resolve problems in a 

25 consistent manner. Subsequently, the licensee implemented a 

26 number of corrective actions. Based on the results of a follow up team 
 25 

1 inspection in January of this year, the 0350 Panel concluded that the 

2 licensee had made significant progress in improving its Corrective 

3 Action Program performance. Next slide. 

4 With the results of the January team inspection, the 

5 NRC concluded that the licensee has effectively implemented long term 

6 actions to sustain performance improvement. In March, based on the 

7 determination that the 0350 process termination criteria were satisfied, 

8 the 0350 Panel recommended that NRC oversight of the Fort Calhoun 

9 Station transition to the licensee response column, or Column One of 

10 the ROP action matrix. On April 1, with all performance indicators in 

11 effect, Fort Calhoun Station was placed in Column One. Independent 

12 of the transition to Column One, there are still some post-restart CAL 

13 items that are yet to be closed. Of particular note are the items 

14 involving restoration of the containment internal structure and 

15 completion of the design basis reconstitution initiative. 

16 With respect to the containment internal structure 

17 nonconforming condition, the licensee has made progress in 

18 addressing this issue, and expects to complete the necessary plant 

19 modifications during the next refueling outage. With respect to the 

20 licensee's design basis reconstitution initiative, we have looked at the 

21 approach the licensee is exercising to complete this important 

22 multi-phase project during our recent component design basis 

23 inspection. We did not identify any concerns with that approach, and 

24 understand that the project is targeted for completion in 2018. We will 

25 continue to monitor licensee activities in this area through our Baseline 

26 Inspection program. Next slide, please. 
 26 

1 With this last slide, I wanted to highlight the NRC 

2 resources we have expended in providing for increased regulatory 

3 oversight of Fort Calhoun Station under the Manual Chapter 0350 

4 process. Since we invoked that process in December of 2011, we 

5 have expended approximately 61,000 hours of NRC staff oversight 

6 effort. As you can see on the slide--if you go to the slide, thank 

7 you--this consists of 45,000 hours of inspection and 16,000 hours of 

8 licensing and assessment activities. As I know you can appreciate, 

9 this is a significant expenditure of NRC resources over nearly a three 

10 and half year period, and while I don't know what the exact number is 

11 for the licensee in terms of resources dedicated to turn the station's 

12 performance around, I know from my discussions with licensee senior 

13 management that that number is substantial, and in my view, the large 

14 resource expenditure underscores the critical importance of the 

15 licensee and regulator diligently exercising their respective roles to 

16 ensure the licensee's long term performance improvement actions 

17 continue to be fully effective. This concludes my remarks with respect 

18 to Fort Calhoun Station. Next slide. 

19 Before I begin my presentation with respect to 

20 Arkansas Nuclear One, or ANO, let me first introduce Neil O'Keefe, 

21 who's sitting behind me here, who is the Branch Chief in Region IV's 

22 Division of Reactor Projects with responsibility for the NRC Inspection 

23 Program at ANO. Neil will be involved in coordinating and providing 

24 appropriate management oversight of the various supplemental 

25 inspection activities we plan to conduct at ANO. He will be playing an 

26 important role in the success of our oversight efforts. With respect to 
 27 

1 my presentation, I plan to focus my remarks in four overarching areas. 

2 First, I'll discuss the Yellow findings we issued for the main generator 

3 stator drop in 2013, and for the flood protection deficiencies that were 

4 identified subsequent to that event, as well as the White performance 

5 indicator for Unit 2, unplanned scrams in 2014. Then I'll discuss the 

6 basis for our view that we, the NRC, have been driving licensee actions. 

7 After that, I'll explain as part of our performance assessment process 

8 the basis for concluding that ANO is safe to continue operating despite 

9 being a Column Four plant. Finally, I'll discuss our planned activities 

10 as part of our increased regulatory oversight of ANO. Next slide, 

11 please. 

12 On March 31, 2013, while moving the Unit 1 main 

13 generator stator out of the turbine building, the temporary lifting rig 

14 failed, causing the 525 ton stator to fall approximately 30 feet into the 

15 shared train bay between Unit 1 and Unit 2. As it fell, the stator 

16 substantially damaged part of the turbine building on the Unit 1 side, 

17 and parts of the lift rig impacted the Unit 2 side of the turbine building. 

18 There was one fatality and eight injuries--eight individuals I should say 

19 were injured. The partial collapse of the turbine deck damaged the 

20 Unit 1 non-vital electrical busses which resulted in a loss of offsite 

21 power for six days. Unit 1 was in a refueling outage and shutdown 

22 cooling was lost for a brief time until the emergency diesel generators 

23 powered the vital busses and operators restarted the pumps. At the 

24 time of the stator drop, Unit 2 was operating at full power. The 

25 vibrations from when the stator hit the second level floor of the turbine 

26 building, as it fell through the shared train bay, caused the Unit 2 reactor 
 28 

1 coolant pump breakers to trip, which subsequently led to a reactor trip. 

2 One offsite power source to Unit 2 was lost after water 

3 from a ruptured fire main caused an electrical fault on the non-vital 

4 switch gear in the turbine building. Operators took appropriate actions 

5 to stabilize Unit 2 and cool the plant down on natural circulation. We 

6 initiated a reactive inspection in April 2013, specifically an Augmented 

7 Inspection Team or AIT, and an AIT follow up inspection was completed 

8 in February 2014. After finalizing the risk significance determination, 

9 which involved the development of a shutdown risk model for Unit 1 and 

10 a modified power risk model for Unit 2, we issued a Yellow finding for 

11 both Unit 1 and Unit 2 in the initiating events cornerstone in June 2014, 

12 which for ROP action matrix purposes was effective the first quarter of 

13 2014. 

14 The performance deficiencies associated with the 

15 Yellow finding involved a failure to follow station procedures to ensure 

16 that a temporary lift assembly was designed to support the projected 

17 load; the failure to perform 125 percent load test; and the failure to 

18 ensure adequate supervisory and management oversight of work 

19 activities involving contractors. The contractor claimed the assembly 

20 had been used before to lift a similar load, and the licensee failed to 

21 check this assertion or verify the adequacy of the assembly design. 

22 The load drop caused some internal flooding due to the rupture of a fire 

23 main, which revealed latent conditions involving degraded flood 

24 barriers. In its initial root cause evaluation for the stator drop event, 

25 which was completed in July 2013, the licensee did not identify any root 

26 or contributing causes related to licensee performance, but rather the 
 29 

1 evaluation focused solely on contractor performance. 

2 NRC inspectors, as part of the AIT follow up inspection, 

3 identified the licensee's failure to follow its load handling procedure. 

4 After the NRC issued the Yellow finding in June 2014, the licensee 

5 initiated another root cause evaluation to address the elements of our 

6 95002 supplemental inspection. In that follow up root cause 

7 evaluation, the licensee did identify organizational performance issues 

8 that led to the main generator stator drop, such as inadequate project 

9 oversight and non-conservative decision making. Next slide, please. 

10 As I mentioned previously, the stator drop damaged a 

11 fire main in the turbine building. The fire water sprayed into the train 

12 bay, causing localized flooding. Some of this water leaked past 

13 degraded hatch seals and entered the Unit 1 auxiliary building. After 

14 the stator drop event, the licensee began an extended condition review, 

15 which eventually led to the identification of over 100 unsealed conduits, 

16 floor drains leading to flood protected structures that were not isolated, 

17 doors and hatches that weren't designed for flooding, open ventilation 

18 ducts, and 13 hatch seals that were degraded. 

19 NRC inspectors also identified several issues which 

20 resulted in the licensee expanding the scope of its extensive condition 

21 review. Examples include unsealed abandoned equipment that led to 

22 flood protected structures, and an offsite power bus that could be 

23 submerged. We also identified that the licensee failed to initiate a root 

24 cause evaluation to assess the design and construction issues 

25 associated with the flood barrier seal deficiencies. With respect to 

26 licensee performance deficiencies, we concluded that the licensee 
 30 

1 failed to design, construct and maintain the auxiliary and emergency 

2 diesel generator fuel storage building flood barriers to protect 

3 safety-related equipment from flooding. Without mitigating or recovery 

4 actions, core damage could occur for any flood event above plant grade 

5 level because the safety related equipment in the auxiliary building 

6 could be submerged. We also determined that for Unit 2, internal 

7 flooding was the significant contributor to the risk. 

8 The significance determination for these performance 

9 deficiencies was particularly complicated, as it involved hydrological 

10 modeling and statistical analysis. We also performed an extensive 

11 review of potential accident sequences and licensee proposed recovery 

12 actions or mitigating strategies. The ANO resident inspectors 

13 performed walk downs to verify the licensee's proposed recovery 

14 actions and determined that some of those actions likely would not 

15 work, where as other actions were more complicated than the licensee 

16 presented at the Associated Regulatory Conference. As a result, we 

17 concluded as part of our final significance determination process that 

18 limited credit was warranted for selected mitigation strategies. Upon 

19 completion of our final--excuse me--upon completing our final 

20 significance determination, we issued a Yellow finding for both Unit 1 

21 and Unit 2 in the mitigating systems cornerstone in January of 2015, 

22 which was effective for action matrix purposes the third quarter of 2014. 

23 Of particular note, the flooding walk downs completed 

24 by the licensee in 2013 as part of our post-Fukushima requirements 

25 failed to identify the majority of the flood protection deficiencies. This 

26 outcome can be attributed to insufficient licensee oversight of 
 31 

1 contractor activities involving walk down scope determination and 

2 actual performance of the walk downs in the plant. After the internal 

3 flooding that occurred due to the ruptured fire main revealed that the 

4 post-Fukushima walk downs conducted by the contractor were 

5 inadequate, the licensee re-performed those walk downs, which led to 

6 the identification of the majority of the flood protection deficiencies. 

7 One of our regulatory conclusions is that the licensee failed to treat the 

8 flooding issues commensurate with their safety significance. 

9 Examples include the lack of contractor oversight, the failure to perform 

10 a comprehensive, extensive condition review until NRC inspectors 

11 identified issues, the failure to initiate a root cause evaluation for 

12 flooding design and construction issues, and proposing mitigation 

13 strategies that were deficient. Next slide, please. 

14 The NRC identified that the licensee had not reported a 

15 Unit 2 trip that occurred in April of 2014 as an unplanned scram. This 

16 would have been the third unplanned scram in a 12-month period and 

17 as such, the performance indicator for unplanned scrams would have 

18 turned White. The other two unplanned scrams were due to a auxiliary 

19 transformer explosion in the fourth quarter of 2013, and a lightning 

20 strike in the second quarter of 2014. Back on April 24, 2014, the 

21 licensee experienced a Unit 2 trip while reducing power at the request 

22 of the grid operator. The trip was caused by the operator's failure to 

23 maintain core power distribution within limits. The licensee concluded 

24 that the trip did not represent an unplanned scram because the trip 

25 occurred during the planned down power evolution. 

26 After NRC inspectors challenged this conclusion, the 
 32 

1 licensee involved the ROP Frequently Asked Question, or FAQ 

2 process, to resolve the matter. In February 2015, the FAQ Committee 

3 determined that the Unit 2 trip counted as an unplanned scram. The 

4 licensee then reported the subject performance indicator as White for 

5 the second and third quarter of 2014. The licensee is currently 

6 completing a root cause evaluation for these events, which we will 

7 inspect during a supplemental inspection. Of note, the licensee 

8 revisited via the FAQ process its decision not to report the performance 

9 indicator only after NRC engagement. Next slide. 

10 In our view, the NRC has been driving licensee actions. 

11 Our inspectors identified weaknesses or gaps in the licensee's problem 

12 evaluations, to include both root cause evaluations and extensive 

13 condition reviews. For example, as I mentioned earlier, the licensee's 

14 initial root cause evaluation for the main generator stator drop event 

15 focused on contractor performance only. Not until NRC inspectors 

16 identified that the licensee had not followed its own load handling 

17 procedure did the licensee conduct a root cause evaluation that 

18 included an assessment of licensee performance relative to the event. 

19 With respect to potential flood barrier deficiencies, the 

20 licensee expanded the scope of its extensive condition review based on 

21 several issues identified by the resident inspectors. When unsealed 

22 penetrations were identified, the licensee treated them individually as 

23 broke/fix and did not assess the collective safety significance of the 

24 condition, whereby a number of unsealed penetrations existed. In 

25 addition, as I mentioned earlier, the NRC identified that the licensee 

26 failed to initiate a root cause evaluation to assess the design and 
 33 

1 construction issues associated with the flood barrier seal deficiencies. 

2 Furthermore, as I noted earlier, we determined that the licensee failed 

3 to treat the flooding issues commensurate with their safety significance. 

4 Given this conclusion, our inspectors looked for other examples of 

5 where the licensee may not have been treating equipment 

6 commensurate with its risk or safety significance. I'd like to describe 

7 one of the findings from that review that I think is particularly illustrative. 

8 It involves the Unit 1 auxiliary feedwater pump, a risk significant, 

9 non-safety related component. 

10 The auxiliary feedwater system for Unit 1 provides a 

11 backup source of feedwater to the main and emergency feedwater 

12 systems. Our inspectors identified that the emergency operating 

13 procedure, or EOP for this system directed operators to start the 

14 auxiliary feedwater pump without opening the normally closed minimum 

15 flow valve in order to establish a flow path. This configuration would 

16 lead to pump failure in a very short time. The EOP had existed with 

17 this error for 20 years, and operators knew about the procedure steps, 

18 but failed to question the configuration. The numerous flood protection 

19 deficiencies that were ultimately identified represent latent equipment 

20 conditions or problems. It has caused us to question if there might be 

21 other yet to be identified latent equipment conditions in the plant. 

22 I would like to take a couple of minutes and describe 

23 two self-revealing latent equipment issues that resulted in findings that 

24 while green in terms of significance determination, were close to the 

25 green/white threshold. The first involves the alternate AC diesel 

26 generator, which is a non-safety related piece of equipment that is 
 34 

1 credited for mitigation of a station blackout event. The alternate AC 

2 diesel generator is similar in design to the safety related emergency 

3 diesel generators, and while it is non-safety related, it has risk 

4 importance. However, the licensee was not maintaining the alternate 

5 AC diesel generator commensurate with its risk significance. The 

6 licensee failed to perform preventative maintenance on the governors 

7 for this diesel, resulting in an overspeed trip of the engine during 

8 testing. The latent condition involved the improper speed setting of the 

9 mechanical governor due to failure to follow or implement vendor 

10 recommendations. 

11 The second equipment issue involves a Unit 1 decay 

12 heat removal pump failure. The wrong breaker component was 

13 replaced during maintenance in 1998, which lead to the failure of the 

14 pump to start during a reduced inventory condition in an outage in 

15 March 2013. The vendor recommended replacing the lower prop 

16 spring and the electrical supply breaker for the pump; however, the 

17 work instruction was not followed, and the upper prop spring was 

18 replaced, thereby reducing breaker reliability. In summary, events and 

19 findings indicate that latent problems have existed in equipment as well 

20 as programs and procedures that have led to plant problems. These 

21 problems were not recognized for a number of reasons, including 

22 inadequate cause and extensive condition evaluations during the 

23 implementation of the Problem Identification and Resolution Process; 

24 weaknesses in understanding of the design basis and lack of a 

25 questioning attitude. It is my understanding that the licensee plans to 

26 conduct a thorough review of various plant systems to determine if any 
 35 

1 other latent conditions exist, and we will assess the adequacy of that 

2 effort through our supplemental inspections. Next slide, please. 

3 While ANO clearly meets the entry criteria for being in 

4 the multiple repetitive degraded cornerstone column, or Column Four of 

5 the ROP action matrix by virtue of having yellow findings in two different 

6 cornerstones, we assessed whether the performance deficiencies 

7 manifested in the main generator stator drop event and flooding 

8 vulnerabilities were isolated in the context of overall licensee 

9 performance. We concluded they were not isolated as my discussion 

10 regarding additional examples of where the licensee has not treated 

11 equipment commensurate with its risk significance or importance to 

12 safety and additional latent equipment issues would indicate. In 

13 addition, we completed a Problem Identification and Resolution, or 

14 PI&R inspection just this past week, with the team exiting at the site with 

15 the licensee last Friday. We enhanced the scope of this inspection to 

16 assess whether broader organizational and programmatic weaknesses 

17 exist at the station. The PI&R team confirmed that significant 

18 challenges exist, and effective diagnosis of organizational and 

19 programmatic performance gaps and effective implementation of 

20 corrective actions for those gaps. 

21 While the report has yet to be issued, one finding of 

22 note which is consistent with the discussion I had earlier about licensee 

23 challenges with the quality of its cause evaluations is that the licensee's 

24 cause evaluations typically don't provide for a thorough assessment of 

25 organizational and programmatic contributors to events or issues. In 

26 our view, to provide for a thorough understanding of its performance 
 36 

1 gaps, the licensee needs to conduct detailed and comprehensive 

2 self-assessments in a range of areas. Once the licensee has 

3 completed this discovery effort, it needs to determine what actions and 

4 strategies are necessary to close those gaps. As part of our increased 

5 regulatory oversight, we will independently evaluate the scope of the 

6 licensee's effort to identify its problems and then assess both the 

7 adequacy of planned corrective actions and the effectiveness of those 

8 actions. 

9 When a plant is placed in Column Four of the ROP 

10 action matrix, one of the most important questions we ask ourselves is 

11 whether we consider the plant safe to continue power operation. 

12 Based on extensive discussion as part of our End-of-Cycle Assessment 

13 Meeting, we concluded the answer to this question is yes. Operator 

14 performance has been strong; when challenged, operators have 

15 responded well. For example, the consequences of the stator drop 

16 event would have been even more significant without the excellent 

17 response by the operators in the control room. Also equipment 

18 reliability has been relatively good; when plant equipment operates 

19 well, there are fewer challenges to operators due to equipment failures, 

20 and of course we will continue to monitor operator and equipment 

21 performance for any notable changes. Next slide, please. 

22 I would like to spend just a few minutes describing 

23 those oversight activities we recently completed and highlight some of 

24 the more significant activities we have planned. With respect to those 

25 activities that we have completed, I led our annual ROP End-of-Cycle 

26 Assessment Meeting that we conducted on May 12, about a week and 
 37 

1 a half ago. This was a public meeting during which we communicated 

2 our assessment of licensee performance over the past year. As I 

3 mentioned previously, we completed a PI&R inspection last week. 

4 Regarding planned supplemental inspections, when the licensee 

5 indicates it is ready to receive, we will conduct a 95001 inspection in 

6 connection with the white performance indicator for unplanned 

7 scrams, and then a 95003 inspection for the yellow findings. 

8 I would also highlight that we are planning to conduct a 

9 Component Design Basis Inspection, or CDBI next year. We moved 

10 the CDBI inspection from later this year to next year to allow the 

11 licensee to focus on preparations for the 95003 supplemental 

12 inspection, as well as to provide us with the flexibility to conduct any 

13 necessary follow up inspection in the engineering area after completion 

14 of the 95003 inspection. Next slide. 

15 In recognition of the additional internal coordination 

16 and communication activities as well as external stakeholder outreach 

17 efforts associated with a plant in Column Four, we have augmented 

18 NRC staffing with the Regional office dedicated to ANO. This includes 

19 assigning a senior oversight manager, Troy Pruett, who is the Director 

20 of the Division of Reactor Projects, and reorganizing the Division so that 

21 ANO is the only plant assigned to a specific branch, and as I mentioned, 

22 Neil O'Keefe is the Branch Chief for that branch. We also anticipate 

23 increased public outreach and external stakeholder communication. 

24 This was evident in the recent ROP End-of-Cycle Assessment Meeting, 

25 where we had significantly more public attendance and engagement 

26 than we have historically seen, which is to be expected given the 
 38 

1 increased agency focus on this plant, and I wanted to mention, 

2 Commissioner Ostendorff, there were some Congressional staffers that 

3 were there that also had accompanied us during your recent trip to the 

4 plant. 

5 We recognize the importance of keeping the public 

6 fully informed of our oversight activities at ANO, and going forward, we 

7 will look at additional communication tools as a function of the degree of 

8 public interest. Next slide. In summary, based on the extensive 

9 discussion with respect to ANO with this year's Agency Action Review 

10 Meeting, NRC senior managers affirm the appropriateness of agency 

11 actions that have been taken for this plant using data compiled during 

12 the ROP End-of-Cycle Review. This concludes my presentation, and I 

13 welcome any questions that the Commission may have. Thank you. 

14 MR. SATORIUS: And we all stand ready to answer of 

15 your questions. That's the complete staff's presentation. 

16 CHAIRMAN BURNS: Okay. Thank you. And 

17 Commissioner Ostendorff will begin the questioning this morning. 

18 COMMISSIONER OSTENDORFF: Thank you, 

19 Chairman. Thank you, team, for here for your presentation. Mark, I 

20 completely agree with you that this is perhaps the most important 

21 meeting this Commission convenes every year and I think the fact that 

22 it's done with the facts on the table, with the public opportunity to see 

23 how we as a regulator function is just critically important. So thank you 

24 for highlighting that in your opening remarks. 

25 MR. SATORIUS: Thank you. 

26 COMMISSIONER OSTENDORFF: I'm going to start 
 39 

1 with Laura. I appreciate your review of the materials and the Waste 

2 Performance Program. It's important that you're at the table here 

3 because sometimes the Materials Program perhaps does not get the 

4 same visibility that the Operator Reactors Program might receive, and I 

5 think it's a real credit that we include this aspect even though we may 

6 not have the licensee appearing for this particular year's session. 

7 I appreciate your highlighting, Laura, the numerator 

8 and denominator problem on the abnormal occurrences. I think that is 

9 so important to reiterate time and again and when we're talking about 

10 especially medical procedures that can save people lives or 

11 significantly improve their quality of life. So thank you for bringing that 

12 to the table. 

13 I also want to give feedback to you and your team. 

14 When I was down in Texas earlier this year and had extensive 

15 engagement with the Agreement State folks down there at the Texas, I 

16 think it was Department of Environmental Quality and their Health and 

17 Safety Group, but all the different aspects of the Agreement State 

18 Program who were very complimentary of the NRC's Agreement State 

19 interface with the State of Texas, which is a very large participant. So, 

20 well done to you and your team. 

21 Scott, I'm going to turn to your presentation. 

22 Appreciated your commentary on what you're doing overall to look at 

23 making the very mature program perhaps even more streamlined, more 

24 efficient in a lot of respects. I think in the context of the Commission's 

25 deliberations on Project Aim your commentary on efficiency is really 

26 important. And so, thank you for bringing that into the discussion. 
 40 

1 I did have a couple of questions I wanted to ask you. 

2 On slide 16 I wanted to -- I've talked to Bill Dean in the past and others 

3 about the Component Design Basis Inspection Program. And I've 

4 talked to regional administrators. I talked to Mark and his team just 

5 down in Arlington back in February on CDBIs. And can you talk a little 

6 bit more about what you're looking at as any potential changes to that 

7 program? I know you're still formulating an opinion and an approach, 

8 but I'd be curious as to what are some of the things that are on the table. 

9 MR. MORRIS: Sure. Thanks, Commissioner. So, 

10 yes, CDBI, extremely important inspection, one in which our external 

11 stakeholders would agree with us on that. The questions that have 

12 been raised about the component draft basis inspection, both internally 

13 and externally really have to do with the scope and breadth and the 

14 amount of time and the number of inspectors that we apply to the effort. 

15 And also whether or not we're spending -- we're going to the same well 

16 multiple times. I think we're in the third or fourth cycle of the CDBI 

17 since this current version of it is implemented. 

18 But we identified a number of things in the baseline 

19 inspection process enhancement effort that I spoke about. In addition, 

20 we received a white paper from the Nuclear Energy Institute and the 

21 industry representing the industry and their interests. They had a 

22 number of suggestions or recommendations about how we should 

23 move forward to modify the program, not to eliminate it. And they 

24 included such things as more credit for industry self-assessment, more 

25 credit for adjusting the scope and breadth of the program based on the 

26 licensee performance, whether your perhaps other engineering insights 
 41 

1 that we may have received through inspections or other activities would 

2 suggest that in an engineering program at a given site is strong, so 

3 therefore we should reduce the scope of the CDBI for that site, and 

4 conversely the other way as well. 

5 Interested in putting together an industry/NRC 

6 oversight panel. There's been some concerns about the type of issues 

7 that are being surfaced as part of the component design basis 

8 inspections and how they seem to migrate from one side to the next to 

9 the next to the next even though perhaps there are compliance issues 

10 that are not particularly safety or risk significance. So there's a number 

11 of things that we're looking at and frankly have agreed with the industry 

12 to continue to pursue. 

13 We are in fact -- there a group of my staff out in Region 

14 III this week who are looking at how to modify the CDBI inspection 

15 going forward as part of a pilot effort. And like I said, we plan to 

16 implement a pilot inspection for some of these changes. 

17 One of the main things I'll leave with on this topic is the 

18 idea that we bring a lot of inspectors over the course of three weeks on 

19 site. And industry has used terms like it paralyzing our organization for 

20 that period of time. So is there a way we can spread that out over a 

21 cycle? And so, that's one of the things we're looking at as part of the 

22 pilot. Maybe do some programmatic work in one week, and then let 

23 some time go by, and then do the actual detailed engineering 

24 independent inspection. So, that's what we're doing. 

25 COMMISSIONER OSTENDORFF: Well, I'm glad 

26 you're looking at it. I think the program overall is good, but I think some 
 42 

1 changes are warranted. I've spent some time on this topic with 

2 industry and with licensees and with the staff. I would ask that NRR 

3 please provide the Commission some type of a communication, your 

4 choice, as to what you're looking at to keep us informed, because I think 

5 this is a critical part of our Baseline Inspection Program and that we 

6 would benefit from hearing what you're thinking is about proposed 

7 changes. 

8 Scott, I'll just comment that I think the -- as I put in vote 

9 on COMSECY-14-0030, it's really important for us to have timely 

10 decision making in response findings in plant events. And so, I 

11 appreciate your focus on that aspect. I recognize that some of these 

12 events are very complicated, and we're going to get into questioning, if 

13 we've got time, with Mark on this on ANO. And I realize have to 

14 provide the opportunity to the licensee to fully explain what has 

15 happened. There's a due process piece here, so to speak, that we 

16 need to -- but basically we provide. But it's important for us to make 

17 timely regulatory decisions. So thank you for your emphasis on that. 

18 Marc, I'm going to turn to you very quickly. I've got 

19 two areas to comment on. One to comment on and one to ask you a 

20 question about. First, on Fort Calhoun, 61,000 hours. I was at Fort 

21 Calhoun this year to look at them during the 0350 process. I thought 

22 Tony from your staff did a great job of keeping us informed on the status 

23 of these 460 corrective actions and so forth. Looking at the 61,000 

24 hours between inspection and licensing and assessment, just big 

25 picture, macroscopic view. I'm not asking if that's a right number or a 

26 wrong number, but any big take-aways you have for that effort from the 
 43 

1 NRC side as a regional administrator? 

2 MR. DAPAS: Yes, thanks for that question, 

3 Commissioner. I would offer that it was the amount of inspection that 

4 was necessary given the performance gaps. I think if a licensee is 

5 very circumspect in identifying their issues and takes appropriate 

6 corrective action, the degree of follow-up inspection obviously is 

7 commensurate with that licensee effort. And there were some cases 

8 where we had to expend additional effort because the licensee hadn't 

9 resolved the issue satisfactorily. 

10 But for a plant that had the degree of performance 

11 gaps and challenges, both equipment, personnel and processes that 

12 existed at Fort Calhoun Station, I think the inspection effort was 

13 appropriate. We did have some learnings from our lessons learned 

14 about when we engage. And it was regarding Corrective Action 

15 Program. But I think in terms of the actual 0350 process it worked as 

16 designed. And I think that it was an appropriate resource expenditure. 

17 I will offer that we are budgeted. When you look at it, I 

18 had assistance from all the other three regions in terms of staffing the 

19 inspection teams to ensure I had the right skill set. And so, there is an 

20 allowance in the budget, the recognition with some number of plants 

21 that you assume are problem plants, so that it's not just one region that 

22 is having to do all the heavy lifting with respect to the resource impact. 

23 MR. MORRIS: And if I could just briefly add, the 

24 61,000 hours over 32 years is about 172 thousand hours per year. 

25 And typically we spend about 6,000, 7,000 hours per year per site. 

26 COMMISSIONER OSTENDORFF: Okay. Thanks, 
 44 

1 Scott. That's helpful. The perspective is helpful. 

2 Marc, thank you again for accompanying me on the 

3 visit March 31st to Arkansas Nuclear One. The five congressional 

4 staffers from the two senators' offices and the local congressmen 

5 appreciated your presence, and the Region IV, and the resident 

6 inspectors hosting that. 

7 MR. DAPAS: Thank you. 

8 COMMISSIONER OSTENDORFF: I just have one 

9 question, the time, real quick. You gave us perhaps the most thorough 

10 discussion of any licensee performance I've heard in the last six of 

11 these I've -- this is the sixth one I've been to. Commissioner Svinicki's 

12 been to a couple more than I have. Your comments on the licensee's 

13 recovery plan as far as realism and so forth? Very brief comments. 

14 MR. DAPAS: I think it's very important that the 

15 licensee engages in a comprehensive discovery effort. If you look at 

16 our 95003, it's a diagnostic- type inspection. I think the licensee clearly 

17 needs to own the performance gaps, ensure that their assessments in 

18 the various areas are comprehensive and then identify appropriate 

19 actions, and then engage and ensure those actions are effective. 

20 So in my view the real onus is on the licensee here. I 

21 don't want to be in a position where our inspection activities are the 

22 means for identifying the performance gaps. I hope that they are more 

23 confirmatory in nature and that the licensee has identified its own 

24 issues and taken ownership. So, that would be my perspective. 

25 COMMISSIONER OSTENDORFF: Thank you. And 

26 again thank you for a very thorough discussion of your viewpoint on the 
 45 

1 ANO. 

2 Thank you, Chairman. 

3 CHAIRMAN BURNS: Commissioner Baran? 

4 COMMISSIONER BARAN: Thank you, Mr. 

5 Chairman. I agree with Mark Satorius and Commissioner Ostendorff 

6 that this is a very important Commission meeting, and I appreciated all 

7 of your presentations. 

8 Mark, I wanted to thank you for all the work you and 

9 your team have done on Fort Calhoun. That's really important work. 

10 And I wanted to pick up where Commissioner Ostendorff left off with 

11 some questions on Arkansas Nuclear One. 

12 Entergy had a site safety culture survey done for ANO 

13 by a third party. How do you view the results of that survey and where 

14 do you see the greatest challenges for Entergy in this area? 

15 MR. DAPAS: Yes, thank you, Commissioner. I 

16 would say that survey clearly is very important. In fact, per our -- when 

17 a plant is in Column 4, we require and independent safety culture 

18 assessment. And then we go in and we conduct our own assessment 

19 and we look of course at the results of the third-party assessment that 

20 the licensee had conducted. 

21 I think it's very important. I think the licensee really 

22 needs to leverage the results to engage the site staff on strategy for 

23 improvement. In fact, my understanding is one of the key findings from 

24 that safety culture assessment was that there's an urgent need to 

25 internalize and communicate the seriousness of performance problems 

26 and engage the site in their strategy for improvement. So, I see this as 
 46 

1 a real opportunity for the licensee to use the results of that safety 

2 culture assessment to fully communicate to the staff that there are 

3 performance gaps and there are clearly issues that need to be 

4 addressed at the station. So I see that as very important. 

5 And one of the other significant findings from that 

6 safety culture assessment, as I understand it -- and this was based on a 

7 brief that I had from licensee senior management shortly after the 

8 survey results had been delivered to the licensee -- that there is a 

9 mismatch between resources and work load that is having an impact on 

10 some safety margins. 

11 And what that means is leadership and site personnel 

12 are not necessarily aligned on those resources. There may be 

13 resources that are dedicated for a certain activity, but because the work 

14 load is greater than the resources -- and example would be extended 

15 cause review. We've had some challenges that we've identified; you 

16 heard me talk about that in my remarks, where the resources dedicated 

17 to that particular deliverable are less than what is being assumed by a 

18 higher degree, a higher level of management. 

19 So what you end up having is individuals prioritizing in 

20 order to get the work done, and therefore the deliverable or the product 

21 is less comprehensive than originally assumed because those 

22 resources have been diverted to other activities. That was an example 

23 that was provided by the licensee to illustrate this mismatch between 

24 resources and work load. 

25 Of course we don't engage in how resources are 

26 dedicated. We engage on what the results are. But that was one of 
 47 

1 the things that were highlighted as a result of the safety assessment, or 

2 the safety culture assessment. And so, I think it's important that the 

3 licensee looks hard at that to ensure they are getting the high-quality 

4 assessment products as part of their discovery effort. 

5 COMMISSIONER BARAN: You highlighted during 

6 your presentation that contractor oversight issues were a contributor to 

7 both yellow findings -- 

8 MR. DAPAS: Yes. 

9 COMMISSIONER BARAN: -- at ANO. How does 

10 the NRC staff ensure that similar contract oversight issues are not 

11 affecting other Entergy sites? 

12 MR. DAPAS: Contractor oversight has been an issue 

13 of particular concern by the industry. We talked about that, not at this 

14 Regulatory Information Conference, but the previous one. As part of 

15 the regional breakout session we talked about oversight of contractors 

16 providing various examples of where there have been challenges. 

17 Quite frankly, our inspection activities are the means that we would use 

18 to assess licensee corrective actions. And when I was at the site 

19 talking to Entergy senior management, one of the things that Entergy 

20 did acknowledge is any issues that are identified at ANO will be looked 

21 at in terms of broader application across the fleet for the other Entergy 

22 South sites. 

23 And one of the things that we have had some 

24 discussions with Jeff Forbes and Joe Kowalewski, senior management 

25 at the site, is the need to perhaps have a status of the fleet discussion, 

26 and this would be a topical area that we would talk about because it 
 48 

1 cross-cuts. So communicating concerns we have in that area to 

2 licensee senior management. And then through our inspections 

3 looking at how has the licensee taken appropriate action to address that 

4 oversight of contractor issue. 

5 But I will offer, it is a broader issue, because like we 

6 talked about at the Regulator Information Conference, what can an 

7 licensee expect from a contractor, a contractor that is an expert in 

8 certain area. There's a certain pedigree of the deliverable that you 

9 should receive. So it gets to do you look at every calculation that a 

10 contractor might conduct as part of something that's been 

11 supplemented with the -- or has been given to the contractors to provide 

12 a deliverable? What is the degree of oversight that's appropriate? 

13 We hold the licensee accountable however arrived at, 

14 but there is a balance there, because otherwise the licensee would 

15 need to have all of the expertise in house if they're going to have to do a 

16 100 percent review of all aspects of a product that they receive from a 

17 contractor. But notwithstanding, we will look at what actions the 

18 licensee takes at each of the sites. 

19 COMMISSIONER BARAN: Thank you. And so 

20 obviously the licensee here has quite a bit of work to do at ANO, and 

21 that has implications for you and your team. What do you see as the 

22 most significant challenges for your staff as they oversee Entergy's 

23 efforts to improve overall performance at ANO? 

24 MR. DAPAS: Well, I think the first thing, as I 

25 mentioned in response to Commissioner Ostendorff's question, is the 

26 licensee identifying its own issues versus is the NRC identifying those 
 49 

1 issues because the licensee hasn't been sufficiently circumspect? 

2 And I am highly confident our 95-003 inspection, given how much of an 

3 in-depth inspection that is, will identify the gaps that the licensee hasn't. 

4 But having an inspection team with the right skill sets 

5 and background is another thing; like we had several teams that 

6 conducted inspection activities at Fort Calhoun, and making sure you 

7 resource load those teams with the right folks, knowledgeable, skilled 

8 individuals. Fortunately I'm able to tap into the resources of all the 

9 other regions in headquarters as necessary to staff those teams. But I 

10 think making sure that the licensee is ready to receive when we come 

11 out and do an inspection so that we are confirming that the licensee has 

12 taken appropriate action versus us identifying problems and then 

13 making sure those inspection teams are appropriately resource loaded 

14 with the right skill set. 

15 COMMISSIONER BARAN: Well, thank you for your 

16 work in this area. I know you've got a lot of work ahead of you. And I 

17 just want to echo what Commissioner Ostendorff said. I mean, I 

18 appreciated that you had a very thorough and frank discussion of the 

19 issues at ANO. And from my point of view that's what we're here for 

20 today, or a big part of why we're here today, and I appreciate -- 

21 MR. DAPAS: Thank you. 

22 COMMISSIONER BARAN: -- your comments. 

23 Scott, I wanted to ask about the pending request 

24 before the Commission to eliminate the three annual reporting 

25 requirements. And particularly I was a little bit surprised about the 

26 recommendation regarding the resident inspector demographic paper, 
 50 

1 because I've heard that even today we do have some issues in certain 

2 areas of the country, difficulty recruiting -- Mark's nodding, because he 

3 has some of these areas -- recruiting and retaining highly-qualified 

4 residents, and really maybe more particularly senior residents. 

5 So I'd just be interested in hearing; again a couple 

6 minutes left, a little bit more about the thinking behind why that report 

7 should be eliminated. Is that we have the wrong metrics here? Are 

8 there better metrics that we should have that would make such a report 

9 more helpful? 

10 MR. MORRIS: Yes, thanks, Commissioner, for the 

11 question. So, briefly; and I could have enumerated further in my 

12 presentation, it's not that we're going to eliminate -- it's not that we're 

13 not interested in the information. It's not even that we're not going to 

14 collect it anymore. It's really a question of the amount of analytical 

15 work that we put into it and also the amount of documentation and the 

16 need to deliver it to the Commission as part of an ROP 

17 self-assessment. 

18 So, what we would propose, what we're looking at 

19 doing is still collecting the information. In fact, even though we didn't 

20 do a self-assessment last year, we still collected the information. I 

21 mentioned the objective metrics that we're putting in place as one of the 

22 elements of the new process. This would be one of the metrics. We'd 

23 have metrics about how long resident inspectors had been on a site, 

24 what kind of experience they had, the same type of thing we had. 

25 The second point on this is that we tend not to make 

26 decisions about site staffing on the basis of these annual reports. It 
 51 

1 tends to be more real time in response to ongoing concerns. And we 

2 leverage the various tools we have for retention and hiring and that type 

3 of thing to deal with things in a more -- we just don't take the annual 

4 report and then say, gee, you know, we need to go back and find 

5 somebody to go fill ANO, or whatever. I mean, that's just now how it 

6 works. But we're still going to collect the information. 

7 MR. DAPAS: If I could just add one quick comment. 

8 Being a region that has some challenges in filling some of the remote 

9 sites, as Scott said, I have a full awareness of what the challenges are, 

10 what the experience level is. And we try and leverage the tools we 

11 have, be it relocation incentives -- and we've increased the relocation 

12 incentive at three sites and that has been successful for two of the three 

13 in identifying qualified candidates. But it's not like I look at that annual 

14 self-assessment and say, oh, it's like the realization that we have 

15 challenges. We're aware of that on an ongoing basis and leverage the 

16 various retention initiatives that we have in place to try and staff those 

17 sites. 

18 MR. SATORIUS: If I could just add one thing. It was 

19 about five years ago when I was in Marc's position and Commissioner 

20 Svinicki asked me a question. Mark, how often do you think about 

21 succession planning for your resident inspectors? And said every day. 

22 That's something he lives every day. MR. MORRIS: And a 

23 final thought, if I could add, just that the report now really only looks at 

24 the amount of time an individual has or experience that they have. It 

25 doesn't really measure the quality. That's a much more difficult thing 

26 to try to assess. The report doesn't go there. That's a softer sort of 
 52 

1 analysis. So it's another reason we sort of question the need to do all 

2 the analytical and reporting work, because it doesn't necessarily have a 

3 good connection to what we're actually doing once we staff the sites. 

4 COMMISSIONER BARAN: Okay. Thanks. That's 

5 helpful. Thank you, Mr. Chairman. 

6 CHAIRMAN BURNS: Well, thank you again for the 

7 presentations. This is actually interesting for me to reflect on the ROP. 

8 And from that standpoint I think this is an area in which the agency over 

9 the years has taken lessons about its Oversight and Enforcement and 

10 Inspection Program and tried to basically magnify the effectiveness and 

11 also the meaningfulness of the program. 

12 I could remember as sort of a junior attorney one could 

13 argue there were five different Inspection and Oversight Programs 

14 within the country when we had five regions, and one could say it was 

15 more like the Articles of Confederation than the U.S. under the 

16 Constitution because there were some very strong -- not that we don't 

17 need strong regional administrators, but strong-willed regional 

18 administrators who had a particular view about how the program should 

19 go. 

20 And from there into the SALP Program, which again 

21 was an attempt again to provide greater unity across the agency and 

22 greater consistency and to the ROP, I think to be a little, as I say, more 

23 timely and forward looking. So again, I think just sort of more a 

24 personal comment or an observation over the years. And again, I think 

25 this is a program that does represent our willingness to sort of learn 

26 lessons and try to improve ourselves. 
 53 

1 I know, Scott, you spoke to -- and I know there's been 

2 this issue in going back. And that was one of the issues I think with the 

3 SALP Program that led to the ROP is the concern of about being too -- I 

4 don't mean retrospective, but basically getting to a point where you 

5 have findings that are basically outdated. That was a concern of a 

6 SALP, as I recall, is you're having a circumstance where you're making 

7 an assessment but the assessment is really about the plant condition 

8 two years before by the time it -- sort of everything processed through. 

9 I mean, one of the things you touched on; and I think 

10 there was some difficulty certainly with the ANO example, but this 

11 question about resolution and in terms of the significance 

12 determination. What would you say are the biggest challenges to that 

13 timely resolution, or achieving timely resolution? 

14 MR. MORRIS: Thanks, Mr. Chairman. I'm actually 

15 glad you asked that question, because I didn't have enough time to go 

16 into it in my slides. 

17 There's actually several things. Its' really not just the 

18 analytical work that's done in risk-based for a significance 

19 determination. The first thing that we need to understand is what is the 

20 performance deficiency? What is the apparent or root cause that is the 

21 actual deficiency that we're going to document as the basis for the 

22 finding? And that sometimes take a while. 

23 I mean, some of these events like ANO are very 

24 complicated to try to figure out precisely where the performance 

25 deficiency is. And sometimes there's many and then we have to 

26 select, well, which one is the most appropriate given the 
 54 

1 circumstances? So a lot of energy goes into determining what the 

2 performance deficiency is in the first place. And we tend to allow, 

3 particularly for the complicated events, the more significant ones, we 

4 tend to allow licensees to complete their own internal root cause 

5 assessment before we formally engage in the analytical work that then 

6 takes time depending on the complexity of the issue, whether or not our 

7 model adequately accounts for the conditions of the facility. Initiating 

8 event frequencies I mentioned earlier. 

9 That being said, there are a lot of things we can do to 

10 tighten this up. And that's what the whole phrase 2 thing is about. 

11 And really what we're focused on there is simplifying it to the extent that 

12 when we realize early on that this is going to be one of those what I'll 

13 call ANO kind of things where it takes us quite a while to get to a bottom 

14 line, to develop some criteria up front so that we know this is the path 

15 we're headed on early. And then potentially divert that into some using 

16 some other criteria or rule-based process to get us to a more timely 

17 outcome. 

18 There's a lot of uncertainty in these things, so we don't 

19 believe that pursuing this alternative path is a bad thing. We think the 

20 potential benefits outweigh the downside of continuing to sharpen the 

21 tools and figure out what the -- and then we have disagreements on 

22 what the right assumptions are and etcetera. So those are the big 

23 things. There's probably a few others. But again, I look forward to a 

24 spirited conversation internally with our senior risk analyst community, 

25 senior leadership, and even the industry on what kind of things we can 

26 do to sort of philosophically move the process to a better, more 
 55 

1 integrated risk-informed approach. 

2 MR. DAPAS: If I could just make -- 

3 CHAIRMAN BURNS: Yes, go ahead. 

4 MR. DAPAS: -- one quick comment. I think one of 

5 the challenges we see in analyzing the risk or safety significance of the 

6 event is how do you credit portable equipment, B.5.b equipment. And 

7 moving forward, I will offer, licensees will look at FLEX equipment here 

8 because it's proceduralized. They train on it. And so, what credit do 

9 you give in terms of recovery or mitigation strategies for that? 

10 In the case of ANO we spent a fair amount of time 

11 trying to evaluate what was the appropriate success probability to 

12 ascribe to different recovery actions? And when you look at a 

13 standard PRA; take the emergency diesel generator, you've already 

14 analyzed the generic database for reliability. You already know what 

15 human error probability is and you have a certain probability that that 

16 equipment will perform. But when you're talking about B.5.b 

17 equipment or other portable equipment, you have to do a case-by-case 

18 analysis to determine what is the appropriate probability of failure or 

19 success, if you will, to ascribe to that equipment. And that's where the 

20 challenge was. And we faced that in particular with the flooding 

21 deficiencies and trying to determine what was the significance. 

22 And then the other challenge I=ll just say unique to 

23 flooding is when you're trying to determine the initiating event 

24 frequency. That is a particular challenge when you're trying to model 

25 the flood plain and determining local precipitation events, etcetera. So 

26 there are some difficulties inherent to the PRA, but I also am a 
 56 

1 proponent of once you identify the issue, we should have a certain time 

2 frame. And my particular view is you go with the best information you 

3 have at that time and then you communicate the result. But just a 

4 thought. 

5 CHAIRMAN BURNS: Yes, thanks to both of you for 

6 that. 

7 Just to mention, I was at the CRCPD meeting earlier 

8 this week talking to them. And you touched on the issue of training 

9 and related activities that help enhance consistency. We heard that 

10 last month when we had the meeting with OAS and CRCPD. But that 

11 was certainly something they echoed again when I had a sort of side 

12 meeting with a lot of the leadership there. So again, that's I think a 

13 good focus for us. 

14 And, Scott, I=ll come back to you. One other question. 

15 You talked about the Plain Language Initiative and all that. Is there 

16 any kind of feedback we get from let's say the end of cycle meetings or 

17 the other kind of meetings about the process? I have to confess I don't 

18 -- I may have been in one year ago, but I haven't been -- 

19 MR. MORRIS: I don't know that I'm -- 

20 CHAIRMAN BURNS: Is there any kind of input we get 

21 in that context? 

22 MR. MORRIS: Yes, we do get input. In fact, when 

23 we have public meetings that we have a -- I think there's a place on our 

24 -- we hand out feedback forms at all of our public meetings. 

25 CHAIRMAN BURNS: Yes, yes. 

26 MR. MORRIS: And we actually collect that 
 57 

1 information and try to utilize that. I mean, I'm personally not familiar 

2 with how we track and trend that. There may be someone else on my 

3 staff who is. But I think just based on my own due diligence in looking 

4 at the quality -- or not the quality, but really how we describe issues, 

5 how we explain issues, I think we try very hard, but we're just not that 

6 good at it and we really could benefit from some independent third party 

7 to come in and say, you know, when you say Delta CDF, what do you 

8 really mean? I mean, we know what that means and the industry 

9 knows what that means, but it's not clear. And that kind of language is 

10 in the executive summaries of some of these reports, and it's tough. 

11 So, I can't directly answer your question. I do know 

12 there are challenges and I do know that as part of the Plain Language 

13 Initiatives as being led out of the EDO's Office we're dovetailing to that. 

14 And again, we're going to get some outside help with that. 

15 CHAIRMAN BURNS: Okay. Yes, I used to joke I 

16 never understand the colors because I'm color blind, so -- 

17 (Laughter) 

18 CHAIRMAN BURNS: But -- 

19 MR. MORRIS: Red is bad. 

20 CHAIRMAN BURNS: I know red is bad. 

21 (Laughter) 

22 CHAIRMAN BURNS: I=m supposed to stop, too. 

23 If I could, just one last question for Marc related to the 

24 issue on contractors. Have we -- in terms of the -- is this contractor 

25 being -- is it other licensees, or other facilities, if that that's a right 

26 question. 
 58 

1 MR. DAPAS: I don't know the answer to that. 

2 CHAIRMAN BURNS: Okay. 

3 MR. DAPAS: Quite frankly I would be surprised to 

4 hear yes, but I don't know the answer to that per se. 

5 CHAIRMAN BURNS: Okay. 

6 MR. DAPAS: We did send out a generic 

7 communication that talked about like for example the contractor 

8 oversight with the post-Fukushima flooding walkdowns where there 

9 have been challenges identified with flood protection deficiencies. We 

10 have sent out some generic communications. And I do know the 

11 industry has communicated with their counterparts, but I don't know to 

12 what extent that contractor continues to be used. 

13 CHAIRMAN BURNS: Okay. 

14 MR. DAPAS: And it was a subcontractor as well. 

15 CHAIRMAN BURNS: Okay. Did you want to say -- 

16 MR. SATORIUS: Just wanted to make sure that you 

17 and your colleagues were aware that when you're talking about 

18 contractors in ANO's case, it wasn't just the rigging contractors. It was 

19 also the contractors that the licensee had hired to do the flooding 

20 walkdowns. A lot of licensees use contractors for that. So it was the 

21 control of those contractors as well. 

22 CHAIRMAN BURNS: All right. Okay. 

23 Commissioner Svinicki? 

24 COMMISSIONER SVINICKI: When we gather in the 

25 back, in order not to violate the Government and the Sunshine Act 

26 before we come out here, we're often talking about current events and 
 59 

1 things as the four colleagues -- we have staff there too to make sure 

2 that we don't talk about any matters of NRC business. 

3 But so we were talking about events in the Middle East and 

4 Commissioner Ostendorff's son had some combat service there and he 

5 made this offhand comment that, oh, I probably mention that too much. 

6 And I said I don't think it's possible to over-recognize the service of the 

7 men and women in uniform. 

8 And so, as we head into Memorial Day I just want to 

9 say that although that Memorial Day is about those who didn't make it 

10 home, I know that NRC has at this table and in this room and probably 

11 listening to me many who have had the honor of wearing the uniform of 

12 this country. So I wish all of them and their families and everyone 

13 listening to me, frankly -- I hope everyone has a wonderful and safe 

14 Memorial Day holiday this weekend. So that was my little one-minute 

15 lead in. 

16 It's interesting to go last because you can kind of think 

17 of all the reactions I was having as I listened to the presentations. I 

18 can talk about some, all or none of them. But some have been 

19 covered by my colleagues. I do appreciate Chairman Burns' reflection 

20 on the systematic assessment of licensee performance, which in my 

21 study of it was not terribly systematic. And that's one of the reasons 

22 that we have the Reactor Oversight Process. 

23 I also have made commentary in years past at this 

24 particular meeting not only about the importance of the meeting -- which 

25 I do have to say this is that Mr. Dapas -- there's been many 

26 compliments of the thoroughness of his presentation. He had the 
 60 

1 distinct honor of having only one licensee to be talked about this year. 

2 At other meetings we've had to divide that time. So weren't you lucky, 

3 Marc, that you got the entirety of that planning wedge on the calendar to 

4 -- on the schedule to fill? So thank you for the thoroughness of your 

5 presentation, which I think was driven by the amount of time we gave 

6 you to talk. 

7 MR. DAPAS: Thank you. 

8 COMMISSIONER SVINICKI: But it was very, very 

9 useful. And that was a complicated event. There were a lot of prongs 

10 of various phenomenon, then the effect they had on each other. So it's 

11 a tough one to talk about. 

12 So when we're talking about things like the significance 

13 determination process, I share the view that we do want to be timely, 

14 but I think we also -- we want to get it right. So I hope and I'm certain 

15 -- since I know most of you, have worked with you for years now, I know 

16 that you do value that and will make sure. We cannot be sacrificing. 

17 We cannot just have a crude understanding of it and then assign 

18 significance. That will not be possible to do or we will find ourselves in 

19 a process of revising that. And I don't think that will gain us anything in 

20 terms of efficiency. So I'm certain we'll keep that in mind. 

21 I do also appreciate that Scott's presentation went into 

22 a number of changes that are under contemplation. On that broad 

23 topic I think the reference that the Chairman made to SALP is so 

24 important because ROP is so mature and is considered one of the 

25 agency's I think very strong success stories, license renewal. We 

26 have other programs that we -- were basically made in the USA, were 
 61 

1 made here at NRC. We didn't really pick them up from any other 

2 country's regulator and we have matured and made them efficient and 

3 effective. And so, I think the danger though is when they've been in 

4 place long enough and have these strengths of objectivity of replication, 

5 which is an important thing that the SALP did not have. You could not 

6 be sure that a plant assessed in Category X in Region Y would have 

7 been -- received the same assessment. 

8 And so, as we contemplate changes to our ROP -- it's 

9 not perfect; of course it's not -- we need to not become so comfortable 

10 in the success of it that we begin to inject things that are perhaps less 

11 replicable, less objective, less scrutable. I use that word a lot, but it's a 

12 kind of like special type of transparency, meaning not only can you see 

13 what was done, you can have some level of understanding because it is 

14 laid out and defined very, very clearly. 

15 When I see that we want to have a consideration under 

16 the streamlining of defense, the significance determination process in 

17 P2, of issues like defense-in-depth, I have to once again step back and 

18 say I'm becoming a little bit troubled with what I seem to hear a lot about 

19 now, which is moving away from things that are easily understood and 

20 defined, clear metrics that are quantifiable. And I worry that perhaps 

21 we are deciding that we chafe a bit under the objectivity and the 

22 replicability of what we've put in place because it constrains us. 

23 Because when you set up a system that is easily understood and 

24 observed from afar, then we can't say, but you know, in this instance my 

25 gut kind of tells me that if we could just -- there was more significance to 

26 this than in another occurrence. 
 62 

1 Well, I would have to tell you that over time I worry that 

2 you're kind of back to a SALP at that point because you have this 

3 overlay of saying the metrics yielded result X, but I have these soft 

4 factors, these qualitative items and my long experience and expert 

5 judgment that allow me to just put it in another category. And please 

6 understand that I know that there is discretion at decision making levels 

7 right now in the ROP. I think that that's important. It needs to be 

8 completely transparent. That's my view. 

9 It's a little bit like campaign finance, which I shouldn't 

10 be talking about things I'm not expert in. But there is the view that as 

11 long as it's all revealed, then -- you know, that corruption -- it's this 

12 notion of pull it out into the daylight, and corruption doesn't survive in 

13 the daylight. So here as long as it's repeatable and understood, I think 

14 that there is room for us to make kind of exceptions from the raw output 

15 of the process. 

16 But the Chairman has also talked about coming back to 

17 NRC from an international post and he talks about this view around the 

18 world of NRC as the gold standard. And I think that that was achieved 

19 foundationally because of just this type of transparent, disciplined, 

20 clearly defined regulatory oversight. 

21 Commissioner Ostendorff made a comment at a public 

22 Commission meeting recently about the question of filters and the fact 

23 that some of our international regulatory counterparts have been very, 

24 very blunt with us that there was no analysis behind their regulatory 

25 imposition of filters. In this country we subjected that and filtering 

26 strategies to our process and we came out with an outcome that said 
 63 

1 that filters are not cost-beneficial, that filtering strategies in some 

2 manifestations do not pass cost-benefit and backfit. 

3 And I think that our desire shouldn't be to be looking 

4 more like the countries that say we kind of thought it up and did it. I 

5 think at the end of the day that makes NRC a lot less than it is now. 

6 And I know that none of you see -- that I know that the years I've spent 

7 here I don't' want to feel like I was there during a time when we were 

8 kind of redefining ourselves to be less than when I came. We all 

9 received this inheritance of this very strong system. You all spend 

10 even more years here than I do, so it means that much more to all of 

11 you as you look at these ROP enhancements. 

12 So I ask you to hear me and please, please tread very 

13 carefully because it's a system that works so much better than what we 

14 had. It works well. It's not perfect, but be careful and be vigilant about 

15 the fact of preserving its strengths, which I know matter a lot to all of us, 

16 because I once listened to Ron Wyden talk about something in a senate 

17 hearing -- I actually kind of remember what it was, but I don't' want to 

18 talk about the issue. It had to do with the Bonneville Power 

19 Administration, not surprisingly, which he of course has always had 

20 strong views on. But he said I will either stop this or I will collapse 

21 while headed in that direction. 

22 And so I sometimes remember what it is to be so 

23 committed to something that there's going to be one or two outcomes. 

24 But I have been here long enough now to have developed a real pride 

25 and then therefore a defensiveness, a kind of maternalistic feeling over 

26 NRC's reputation. And when I look at -- and hear me that we're going 
 64 

1 to have a lively debate on qualitative factors on using defense-in-depth 

2 to justify cost-benefit analysis. And I won't go quietly. I will either stop 

3 it or I will collapse while headed in that direction. 

4 So I think the one thing you know about me; and you're 

5 all laughing because -- and in a good way -- because you know me at 

6 this point. There's no hiding. It's like family. We know each other. 

7 You know where I=m coming from on that. But, so this ended up -- I'm 

8 becoming -- these are going to take on a religious tent revival fervor 

9 here -- 

10 (Laughter) 

11 COMMISSIONER SVINICKI: -- because I=m just 

12 making homilies all over the place. But I know that -- and part of it 

13 -- someone said to me, they said you've become like extremely 

14 protective of NRC. And I think that I'm that kind of person. You can't 

15 put me somewhere, no matter what I think -- and I have very 

16 conservative views, and you also know that about me, and I believe that 

17 -- I'm all about good governance and government doing the right things 

18 in the right way. 

19 But that being said, if you put me somewhere, I'm 

20 going to become very, very kind of protective of that place. And the 

21 -- you all maybe don't know what you have here. That was the thing 

22 about coming to NRC. You have something just -- the reputation for 

23 excellence, you don't know how rare that is. You don't understand like 

24 how precious it is. But it's like any reputational thing. It's in jeopardy 

25 of being lost. All it takes is a couple of stupid actions and then it's 

26 gone. So I just -- I want that for this place. And I=m sure I didn't earn it 
 65 

1 for you and it was probably earned by a lot of sweat equity from a lot of 

2 people, some of you of course. But oh, my gosh, hold onto it because 

3 it's rare and it's precious. 

4 MR. MORRIS: May I just -- 

5 COMMISSIONER SVINICKI: Scott, yes, of course. 

6 MR. MORRIS: -- react to what you said? First of all, 

7 I want to agree with everything you just said. In fact I started out my 

8 presentation on the ROP enhancements saying we believe and 

9 stakeholders have affirmed that the ROP is an effective process, and 

10 we don't want to lose that. 

11 That being said, we're a learning organization and 

12 we've got a lot of inputs and we know we can always do better. You 

13 may not know this: Bill Dean likes to refer to himself as the father of 

14 the ROP and he probably -- 

15 COMMISSIONER SVINICKI: Because it's successful 

16 it has many fathers. Do you know that saying? Success has many 

17 fathers. 

18 (Laughter) 

19 MR. MORRIS: Yes, it does. I think Mike Johnson is 

20 the godfather. 

21 COMMISSIONER SVINICKI: And the self is an 

22 orphan. 

23 MR. DAPAS: Right. 

24 COMMISSIONER SVINICKI: Okay? 

25 MR. DAPAS: Well, I happen to be a child -- I was one 

26 of Bill's children. So I was on the working group that developed it, 
 66 

1 including the SALP. So I am very well attuned to first principles 

2 associated with this program. In fact my staff, who I'll put up as the 

3 best in the agency, hear me say the words "Let's make sure we're not 

4 deviated from first principles." They hear me say that all the time. So 

5 first principles include the things you mentioned: predictability, 

6 scrutability, clarity, risk-informed, performance-based. 

7 What we struggle with, quite frankly, Commissioner, is 

8 when we get into these circumstances where we're spending 200, 

9 maybe 300 hours trying to come up with a risk significance of a finding 

10 that will move -- that will result in a 40-hour inspection. We really 

11 struggle with how much we put in on the front end to determine how 

12 much we do at the licensee site on the back end. 

13 So I'm just pointing out one of the factual realities. 

14 COMMISSIONER SVINICKI: But to your credit, in 

15 parallel you're also looking at how many findings of X color move you 

16 from here to there because one of the reasons that we go to our battle 

17 stations on the significance is because of the color, because of the 

18 number, because of when they occur. And it's like any system. 

19 People are going to get experienced with it and they're going to work 

20 -- and I'm over my time and my colleagues are so patient with me, and I 

21 appreciate that a lot. 

22 I want to say on the reports I share Commissioner 

23 Baran's view, but I'm going to just add further to that. On the resident 

24 inspector I'm not sure -- I'm going to look closely at your request on all 

25 three of them. And I do try to be reasonable on this. But I'll use this 

26 as a point. The resident inspector report that comes to the 
 67 

1 Commission -- first of all, if it takes a lot of extra work to take it from 

2 compiled and written up to get to us, I=ll walk down to your office and get 

3 a copy of it. I don't know what the steps are there, but if that is so 

4 labor-intensive, I'll come get it. 

5 But the other thing is that I know that a Regional 

6 Administrator thinks about it every day, and the rebuttal to 

7 Commissioner Baran was, well, it's not really helping us fill these 

8 positions. I don' think that's the point. When I get that -- first of all, it 

9 wasn't instituted for that reason at all. It wasn't intended to make -- so 

10 if it's failing in that purpose, that wasn't one of its purposes. 

11 But what it does is it reminds me that, oh, by the way, 

12 when I have to vote, I=m selecting one of you all to fill these important 

13 positions in the agencies. If I don't see Resident Inspector on your 

14 résumé, I'm at least going to want to think about that. It's a reminder to 

15 me at an all-hands meeting to make some comment about that that is a 

16 valued experience that many members of the SES have and it's to give 

17 it that visibility. It's to try to increase the attractiveness and the value of 

18 that so that I remember as a messenger that I am part of fixing that 

19 problem, even though I don't have to deal with it at the functional level 

20 that Mr. Dapas does. But if I don't get that annual report, is that going 

21 to fall off my radar screen? I have to tell you, yes, it probably is, 

22 because I'm a human being. 

23 So I will look at it. I will try to be reasonable, but the 

24 fact that these reports -- maybe you don't have problems in these areas 

25 because of the fact that you remind the Commission every year about 

26 these topics. And so please understand that if you don't get universal 
 68 

1 approval to do that, it's not because we want to keep reporting burdens 

2 on you with that. I=ll stop. Thank you. 

3 CHAIRMAN BURNS: Before our break anything 

4 else? Commissioner Baran? 

5 (No audible response) 

6 CHAIRMAN BURNS: Yes, we'll reassemble at 11:00. 

7 (Whereupon, the above-entitled matter went off the 

8 record at 10:54 a.m. and resumed at 11:02 a.m.) 

9 CHAIRMAN BURNS: We'll now have a presentation 

10 from Entergy on their action plan for Arkansas Nuclear One. 

11 Representing Entergy will be Timothy Mitchell, Senior Vice President, 

12 Nuclear Operations for Entergy Nuclear; Joseph Kowalewski, Chief 

13 Operating Officer for South Entergy Corporation; John McCann, Vice 

14 President of Regulatory Affairs for Entergy; and Jeremy G. Browning, 

15 Vice President of Operations for Arkansas Nuclear One. And 

16 gentlemen, you may begin. 

17 MR. MITCHELL: All right, good morning, Mr. 

18 Chairman and Commissioners. First, I want to tell you how much I 

19 appreciate the opportunity to come speak. We do want to tell you how 

20 we own our problems. We are going to take actions. We are in an 

21 assessment process right now. We intend for those to be 

22 comprehensive and extensive as we work through those assessments. 

23 And I'll get into more detail on that. 

24 But a couple of things I do want to talk about 

25 specifically, there were questions earlier, are associated with the 

26 contractor oversight. We have significantly made changes in the way 
 69 

1 that we do contractor oversight across our fleet, not just in the South, 

2 not just at ANO, but across the entire fleet. 

3 Our belief absolutely is in that we have to identify our 

4 own issues. So one of the big things that we are driving right now, we 

5 have been driving, is to make sure that we do that very thing. And our 

6 assessments are in progress right now as far as the breadth that they're 

7 intended to be comprehensive. They are driving to cover all aspects of 

8 operation at Arkansas Nuclear One. And then outcomes will ultimately 

9 drive where we go with an action plan. 

10 So before I go forward, I do want to say I'm here, I'm 

11 the Senior Vice President of Nuclear Operations. Jeff Forbes sends 

12 his regrets and apologizes. He had a medical procedure this week at 

13 the Mayo Clinic. It went well, but he could not reschedule that medical 

14 procedure and it just was an unfortunate timing because he will be very 

15 much involved with the recovery efforts at Arkansas Nuclear One. 

16 So the entire organization is focused on Arkansas 

17 Nuclear One. We've changed our oversight structure from a corporate 

18 standpoint and we have 

19 identified very specific division of responsibilities that include Jeff 

20 Forbes' responsibilities associated with Arkansas Nuclear One. 

21 You've already been introduced to the gentlemen that 

22 are assisting me today and they all very much own, just like I am 

23 describing here. 

24 Now I'll go to opening comments, please, slide. 

25 Having a 500-ton stator drop on our turbine deck, 

26 having that fatality occur, having the unrecognized latent deficiencies 
 70 

1 that existed within our plant, those are just unacceptable. We 

2 understand that this is not bad luck. We understand that it is not bad 

3 timing. Our performance decline started some time in the past. We 

4 are analyzing when did we think that performance declined at Arkansas 

5 Nuclear One started. We will go back in history and our causes will 

6 address all elements of what has occurred in order to allow that 

7 performance decline to occur. 

8 So our reviews will also be by design very 

9 comprehensive in nature. Our concern is with safety. We will restore 

10 confidence in the safe operation of the facility. We have and will 

11 continue to benchmark to aid in our learnings. We will not be satisfied 

12 until a healthy, continuous, improvement culture is established. 

13 Go to the next slide, please. 

14 For this recovery, we are committed to operate the unit 

15 safely and conservatively. So during the entire period that we are 

16 focused on recovery, we will staff the organization -- I'll get into that in 

17 some more detail in just a minute -- to ensure that our focus on 

18 operational performance does not decline in any way, fleet-wise or 

19 site-wise. 

20 We're focused also on correcting performance 

21 deficiencies and do that with urgency. One of the aspects of our 

22 self-assessment on the Corrective Action Program was the timeliness 

23 or the urgency that we attacked those actions. We are fixing that. 

24 We're going to take a broad view towards condition 

25 and cause. We're going to implement effective actions that improve 

26 performance. We're going to change the culture to promote a healthy, 
 71 

1 continuous improvement and to not only achieve, but also to sustain 

2 excellence. 

3 These objectives that I went through either on the slide 

4 or that I just talked about also don't mention Arkansas Nuclear One. 

5 The reason is we're going to not just focus on Arkansas Nuclear One. 

6 We're going to take advantage in order to improve the entire fleet. 

7 Go to the next slide, please. 

8 Now we'd like to talk about the how we're going about 

9 this. So it's real easy to say that we're going to do it, but if we don't look 

10 at how we're going to achieve it, then we will not get the results we 

11 expect. So a lot of work has gone in over the last year or so to make 

12 sure that we had an organization in place, that we had processes in 

13 place, that we had the oversight in place necessary to enable the 

14 recovery. 

15 The benchmarking that we discussed earlier not only 

16 focused on what was learned from Column 3, what design deficiencies, 

17 what modifications, it also focused on what organizations worked the 

18 best to make sure that the recovery effort was effective. 

19 We also want to focus on doing good analysis and that 

20 analysis is important, but a real objective is to go implement fixes. So 

21 we are not just going to analyze things. We're going to go beyond that 

22 and we're going to implement fixes to our problems. We're going to 

23 correct problems. 

24 We have supplemented our resources including 

25 dedicated energy leadership. This includes using a large number of 

26 experts that also have previous recovery experience. 
 72 

1 We commissioned the Independent Safety Culture 

2 Assessment last July. It is now complete, concluding and I quote, 

3 "That although weaknesses exist, the overall safety culture at ANO is 

4 sufficient to support safe operation." We think that's important. We 

5 think it's very important we stay focused on that to ensure that that does 

6 not decline at any point during the recovery process. 

7 The key findings are being used to obtain site-wide 

8 buy-in that recovery is needed. So as Mr. Dapas spoke during 

9 answers to questions, we agree that that buy-in has got to occur. We 

10 agree with the Independent Safety Culture Assessment, that that's 

11 something that we're driving and we believe we're making progress on 

12 that. 

13 We have dedicated corporate -- let me back up a little 

14 bit. We're going to use the 95003 inspection procedure also to help 

15 guide us in how to be comprehensive, but we don't limit ourselves just 

16 to the 95003. We are going beyond that with our assessments. 

17 Dedicated corporate oversight is also a key 

18 organizational design feature provided to both help ANO, but also to 

19 leverage improvements across the entire fleet and learnings across the 

20 entire fleet. The scope of oversight includes what's normal operating 

21 activities and recovery efforts. 

22 The Chief Nuclear Officer, as I said earlier, he will be 

23 personally involved with the recovery efforts. So that guarantees that 

24 the resources necessary will be applied to this station. 

25 Next slide, please. 

26 All right, so much of this slide I've spoken to, but there's 
 73 

1 a few things that I really do want to point out. The dark blue arrows are 

2 actions that have already been completed. The brown are actions that 

3 are currently in process, all of this part of the assessment process. 

4 Our focus is on completing thorough and completed 

5 assessment of our performance which we expect to have complete in 

6 the third quarter of this year. We are dedicating resources to make 

7 sure that that is comprehensive. The time line bar across the top says 

8 2014. And I apologize. It should say 2015. Activities 

9 beyond that point are not scheduled. We will schedule based on a 

10 known scope. We will not no scope until we have completed these 

11 assessments. 

12 So a couple of important assessments here that we've 

13 already talked about, one of them, the Independent Nuclear Safety 

14 Culture Assessment. You'll see it is complete. We thought that was 

15 very important that we commission that early, again, last July. And 

16 the lessons have been covered quite a bit including the lessons 

17 associated with the Corrective Action Program. 

18 We've also completed our assessment of the PI&R, so 

19 problem identification and resolution. And we identified similar things 

20 to what Mr. Dapas spoke to earlier. The root cause for the PI&R 

21 assessment is currently in progress. 

22 So with that, go to the next slide, please. 

23 So in closing, I'd like to stress that we consider 

24 Arkansas Nuclear One performance gap serious. We are totally 

25 committed to fully assessing our performance in a rigorous manner. 

26 We will take action to eliminate the gaps to create a sustainable drive 
 74 

1 for excellence. We will apply lessons to improve fleet performance as 

2 well. Our recovery has been started, but we have a lot of work to do in 

3 front of us. 

4 Thank you, Mr. Chairman and Commissioners, for the 

5 opportunity to speak. 

6 CHAIRMAN BURNS: Thank you. And we'll begin 

7 again with questions from Commissioner Ostendorff. 

8 COMMISSIONER OSTENDORFF: Thank you, 

9 Chairman. 

10 Thank you for being here today and for your 

11 presentation. I reflect back upon the visit I had with some of you back 

12 into March of this year. We had a very candid, frank discussion around 

13 your conference table at the end of my visit when Marc Dapas was with 

14 me on March 31st. 

15 And I think -- maybe it's just helpful for me just to share 

16 some observations that I have here. One of them was at the time, 

17 discussing with Region IV Administrator, I think, in the initial aftermath 

18 of the stator drop event, it was not clear that Entergy or the site had 

19 taken full responsibility or accepted the seriousness of what had 

20 happened as far as my personal opinion was that there was a lot of 

21 finger pointing at the contractor piece dealing with the stator load drop. 

22 I can remember years ago when I was a squadron 

23 commander in Norfolk. We did weapons handlings evolutions all the 

24 time on the pier and every day we could be loading weapons, 

25 Tomahawk missiles, ADCAP torpedoes, Harpoon missiles three days 

26 in a row. And every day, we started out with a load test, the same 
 75 

1 crane that was used the day before, every day. So my initial waterfront 

2 weapons handling experience with cranes and so forth kind of shaped 

3 my initial impression. 

4 So I'll tell you I initially had some concerns as to where 

5 you were on your acceptance of your responsibility. I'm not trying to 

6 lecture you here. I'm just sharing some thoughts. But I'd say when I 

7 discussed around the table with you all that these issues here about 

8 seven or eight weeks ago I felt better about your acceptance of the 

9 challenges and where you were. 

10 I think the Region IV Administrator stated in the first 

11 panel that the NRC was driving licensee actions. That's a pretty strong 

12 statement. And I'm taking, Tim, that you were not necessarily 

13 disagreeing with that. Is that -- as far as the past history? 

14 MR. MITCHELL: I believe there are things that were 

15 driven that we did not look at reflectively to the extent that we could. I 

16 believe that could spend a lot of time talking about the causes and 

17 those causes were already important for us to go back and understand 

18 because those causes need to be part of our action plan to ensure that 

19 we never get back there again. So yes, we agree. 

20 COMMISSIONER OSTENDORFF: Okay, because 

21 that's a pretty strong statement that Mr. Dapas made, I think he backed 

22 it up with a number of contextual examples. 

23 Good news and I'll tell you a real strong -- we talked 

24 about this as well, you have strong endorsement of your operator 

25 performance in response to flooding acts and other issues. I think 

26 that's a strong kernel to build from because I think if there had been a 
 76 

1 strong statement or statement that the Regional Administrator did not 

2 have confidence in your operator performance that would be a game 

3 changer for me. So I think that's a strength you can build upon. 

4 And I was tell you all -- I think I was telling John this a 

5 few months back, it was 30 years ago, I was on a submarine that failed, 

6 a nuclear weapons technical proficiency inspection. We were carrying 

7 nuclear weapons at the time. It was a big deal. And dealing with the 

8 morale issues of the workforce, the operators, when you're trying to 

9 recover and it's going to be a marathon and not a 100-yard dash, trying 

10 to recover from something over a period of time, keeping morale up and 

11 focused is really important. 

12 So I think you have the good news piece of the 

13 operator performance being strong. And so I encourage you, as I 

14 know you will, to leverage that to your advantage as you move forward 

15 with your various recovery actions. 

16 MR. MITCHELL: And to protect. 

17 COMMISSIONER OSTENDORFF: Yes. Exactly. 

18 This Commission has experience with bringing in outside resources in 

19 the context of Exelon, going in to help OPPD with Fort Calhoun issues. 

20 I think there's a lot of lessons learned. I know that these, I think, 

21 outside resources from within Entergy, is that -- 

22 MR. MITCHELL: It's both. 

23 COMMISSIONER OSTENDORFF: Both. Why don't 

24 you comment on the ones outside of Entergy? 

25 MR. KOWALEWSKI: So we've supplemented 

26 resources at two -- in two different groups. We've got regulatory 
 77 

1 response group which is performing all of the assessment, the root 

2 causes which has participation from the site, but it's primarily staffed by 

3 personnel that are contractors, many of them have been involved with 

4 Palo Verde, Fort Calhoun, Browns Ferry recoveries. The Safety 

5 Culture Assessment Team had many of the same people that did the 

6 safety culture assessment at Palo Verde. So that organization is 

7 structured such that we are bringing in a lot of that expertise. And right 

8 now, we've got over 80 people doing these various assessments. 

9 What we wanted to do is not lose our ownership, so the 

10 managers over those different assessments are Entergy personnel. 

11 What we did was we have hired additional Entergy personnel so that we 

12 can rotate key managers over to run those assessments, own those 

13 assessments, and then we've got reviews that will engage the rest of 

14 the site and what they're finding and to help guide them. 

15 The other thing we did was take the operating 

16 organization and look at what the demands are going to be on it. And 

17 we are both changing some of that organizational structure to provide 

18 additional oversight and resources and providing contractors as well as 

19 additional Entergy employees. So for instance, we recognize we're 

20 going to have a very heavy engineering workload, so we've increased 

21 the number of Entergy engineering managers from two to four. 

22 MR. MITCHELL: And the reason why it's important 

23 that we supplement the resources is we want to make sure that we do 

24 not succumb to any misdirection anywhere else in the fleet or that we 

25 lose the operational focus that you referred to as well. So we think it's 

26 important. And some of that expertise is very valuable in assessing 
 78 

1 performance. And so we want outside eyes looking at our 

2 performance as well. 

3 COMMISSIONER OSTENDORFF: Well, I know that 

4 you know you have a lot of work to do. I look forward to hearing the 

5 progress as you march down this path. Thank you. 

6 CHAIRMAN BURNS: Thank you. Commissioner 

7 Baran. 

8 COMMISSIONER BARAN: Thanks. Mr. Mitchell, 

9 you started off almost at the very beginning talking about your focus 

10 now on contractor oversight issues. And I wanted to just follow up and 

11 get a little more detail on specific actions that Entergy has taken to 

12 address that issue at ANO or at other Entergy South facilities. 

13 MR. MITCHELL: There were independent root 

14 causes done on it, two issues; one being the flooding and the other 

15 being the stator drop. From a stator drop standpoint, we've changed 

16 the way that we apply the ANSI guidance as far as what you have to do 

17 in order to validate that an adequate load test has been done on any 

18 component. 

19 When we looked at it, a lot of the things like polar crane 

20 in the containment, they're checked shiftly, similar, they're not a 

21 full-load test, but there is a checkout done at a very defined frequency. 

22 However, when you're using a first of a kind or a unique lifting 

23 apparatus, there were some code allowances that we allowed to occur 

24 that were certified by a vendor as meeting the conditions of that code 

25 allowance and they didn't. So we have implemented independent 

26 checks of those kinds of considerations and quite frankly, we're going to 
 79 

1 do a lot more load tests. That's not something that comes up every 

2 time. But even when you consider things like a transformer or 

3 something, we put personal lives on the certification of the jacks that 

4 are used to jack a transformer, for example. So the intrusiveness has 

5 been ramped up extensively. 

6 As far as the oversight of the flood barrier walk downs, 

7 that's just something that we have to ingrain in our program that we are 

8 going to lead those efforts. We're not going to rely on other eyes to go 

9 look. The other eyes are important because they do give you 

10 independence, but we have to own those results. 

11 Joe, did you want to add? 

12 MR. KOWALEWSKI: Yes. And more broadly, we 

13 did make changes in our process with respect to normal contractor 

14 activity and the requirements for the oversight -- Entergy oversight 

15 when a contractor comes on site. And when there's a large number of 

16 contractors coming on site, in particular, say a refueling outage, we've 

17 added an audit element to that so that not only are we implementing 

18 additional controls of the contractor oversight, but when there's a large 

19 effort that the independent oversight goes and audits to make sure that 

20 that has been done appropriately, to add that additional check. 

21 We also identified a level of safety risk which we called 

22 enterprise risk and created a new process when we reached those kind 

23 of activities that can have a very significant impact on the safety of the 

24 unit such as a stator lift. 

25 Another item that hit our enterprise risk trigger was 

26 bottom-mounted instrument inspections because of potential safety 
 80 

1 impacts of leakage there. So that when we identified an enterprise risk 

2 item which typically involves contractors, we elevate all the way to the 

3 COO level the detailed contractor reviews for those activities and how 

4 there will be oversight. 

5 MR. MITCHELL: And actually enterprise risk goes all 

6 the way to the Office of the Chief Executive. 

7 COMMISSIONER BARAN: And focusing for a minute 

8 on the post-Fukushima flooding walkdowns by contractors, have you 

9 seen similar quality concerns or have similar quality concerns, but 

10 identified at other Entergy sites? 

11 MR. MITCHELL: We did an extended condition at all 

12 Entergy sites and really found no concerns with the walk downs at the 

13 other sites. But we did go check for light configurations, unscheduled 

14 cables. We looked at everything we learned from Arkansas Nuclear 

15 One and applied it at the other sites. 

16 COMMISSIONER BARAN: Okay, and on the 

17 Independent Safety Culture Assessment, what areas do you see as 

18 needing the most improvement there at ANO? 

19 MR. MITCHELL: First of all, we've got to have a 

20 recognition that performance has got to improve. So that's got to be 

21 ingrained in the organization. That's something that we'll be very 

22 focused on. Some of the CAP elements that were noted in the 

23 Corrective Action Program, excuse me, I'm doing acronyms, Corrective 

24 Action Program elements that were pointed out with dealing with 

25 corrective actions in a timely or an urgent manner, making sure that 

26 we're putting the right rigor behind them, but that we are closing out and 
 81 

1 fixing our problems. 

2 And then the organizational programmatic elements, I 

3 think those are things that we need to be better at being able to do when 

4 we're doing causal analysis within CAP. 

5 Jeremy, do you want to add? 

6 MR. BROWNING: I didn't want to miss Marc Dapas 

7 earlier comments about one of the key elements that was identified in 

8 that Safety Culture Assessment was the need to communicate and 

9 align the organization on the performance gaps, the significance of 

10 those performance gaps, establish that sense of urgency in order to fix. 

11 It's not a process problem when it comes to our Corrective Action 

12 Program, it's our implementation which is defined by our behaviors 

13 which establishes the culture. So we recognize that we have to fix that 

14 culture first before we fix that engine that's going to drive our 

15 performance improvement which is the Corrective Action Program. 

16 But you can't get that until you've got the sense of urgency, the passion 

17 and the commitment by each and every employee for improvement, so 

18 that is one of the key focus areas for me at the station is to make sure 

19 that I've got the buy-in and the commitment by the entire team. 

20 MR. MITCHELL: We think that will really benefit us 

21 that Jeremy and Joe and others commissioned that last July so that we 

22 already have the results of it while we're doing these assessments now. 

23 COMMISSIONER BARAN: And I'm over my time, but 

24 I wanted to just briefly ask, Marc Dapas discussed at length his view of 

25 the ANO situation. Is there anything in his description that you thought 

26 was unfair? 
 82 

1 MR. BROWNING: There's nothing that he said was 

2 unfair. 

3 MR. MITCHELL: I think it was completely fair. 

4 COMMISSIONER BARAN: Thanks. 

5 CHAIRMAN BURNS: Thank you. I wanted to follow 

6 up with Commissioner Baran's questions regarding the safety culture 

7 survey and he got to a lot of questions I would have had in terms of 

8 areas of focus or over improvement. But one of the things I think you 

9 said, Mr. Mitchell, that there were some positives out of it as well 

10 as -- as reflecting on Mr. Dapas' comment regarding the strength of the 

11 operator performance. What do you see out of this survey that you 

12 think you can leverage in terms of what I'll call positives or places to 

13 build on from the survey? 

14 MR. MITCHELL: That would be something Jeremy 

15 could expound upon as well, but you know, I think it is very important for 

16 us to protect, just like Commissioner Ostendorff's question on the 

17 operator fundamentals. We want to maintain a strong focus on those 

18 operator fundamentals. I think the independent team noted that there 

19 was strong performance within Ops and to have an organization that 

20 has a strong operational focus, it takes more than just the Ops 

21 organization to have that. So those elements are definitely things that 

22 we think will aid us as we move forward, but I go to sleep every night 

23 concerned that that's got to be our number one priority is to make sure 

24 we protect that. 

25 Jeremy, do you want to elaborate? 

26 MR. BROWNING: I think that survey also pointed out 
 83 

1 that there's a tremendous amount of pride within the organization. It is 

2 a legacy organization that's very proud of what it has contributed to the 

3 industry and I think that's also been a detriment to our performance 

4 decline is our sense of pride in what we've done, what we have 

5 accomplished. We were resting a little bit on our past successes, 

6 assuming future successes and we lost that self-critical desire to just 

7 continuously improve in everything we do. 

8 Now aligning the organization to that and letting the 

9 organization reflect on that, I think is helping us now get that teamwork 

10 and that pride reestablished that we are going to reestablish ourselves 

11 as an industry leader and we've got the capability and the capacity to do 

12 that. That assessment did say that, but they said that's a fragile thing. 

13 You're going to lose that if you don't act on it very quickly. So that is 

14 one of the focus areas is to continue to leverage the pride, the 

15 teamwork, don't let the chins hit the chest. Keep the chins off the 

16 chest, keep focused on the task at hand, and we've got the capability to 

17 do this. 

18 CHAIRMAN BURNS: Thanks. 

19 MR. MITCHELL: And that's why we're pushing the 

20 assessment period right now so hard. Is once we get to an action plan, 

21 it will be easier to show people what they need to do to complete the 

22 action plan. Right now, during the assessment period, that -- we've got 

23 that focused on the learnings from the Independent Safety Culture 

24 Assessment and it will expand after we get the specific actions. 

25 CHAIRMAN BURNS: Thank you. One of the other 

26 things that was interesting to me in your description is you talked that 
 84 

1 during the recovery process you would try to do some benchmarking 

2 against successful recoveries from other facilities or other units that 

3 have had difficulties. 

4 Tell me a little bit more about that, what types of either 

5 sort of generically or even specifically what types of things you're 

6 looking at in that regard? 

7 MR. MITCHELL: We've actually already done a large 

8 number of assessments. We've assessed -- to name plants, Palo 

9 Verde. We've assessed Browns Ferry. We used lessons from Fort 

10 Calhoun. I personally talked to the Chief Nuclear Officer at Palo Verde 

11 to get his assessment of what things do we need to be doing, what 

12 things does myself or Jeff Forbes need to be focused on so that was 

13 quite an interesting conversation. We'll be doing more of that. 

14 Joe went to Palo Verde personally to do a Palo Verde 

15 benchmark that was at lower levels within the organization, how the 

16 regulatory assurance people at the site dealt with recovery and so forth. 

17 So there's been a lot benchmarking to this point, but it will continue. 

18 Our whole organization for recovery is designed based on what we've 

19 learned from that benchmarking. 

20 MR. KOWALEWSKI: The resources that we're 

21 putting in play on the operational side are very much a result of that 

22 benchmarking and we're also adding additional resources to the 

23 corporate staff based on that benchmarking that after these 

24 assessments, we have our corporate functional area managers, 

25 experts in the various disciplines involved in the assessments. The 

26 outcome of that will change procedures, processes, behaviors that we'll 
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1 want to leverage across the fleet. That takes corporate resources to 

2 do that leverage. 

3 We learned from our benchmarking that we need to act 

4 now to increase that staff so that as we complete the assessments, we 

5 can go right into that improvement and not be reacting. So we're 

6 getting a jump on expected outcomes and staffing up for expected 

7 outcomes before we even know them and that's going to help us not 

8 have a gap there. 

9 MR. MITCHELL: Actually, part of that lesson was that 

10 the fleet and corporate can be an inhibitor upon applying the processes 

11 that are needed for recovery. So that's all part of why we have 

12 significantly increased the focus of corporate upon Arkansas Nuclear 

13 One, including dedicated focus upon. So it's not just to make sure that 

14 we know that they're not losing the bubble with respect to operational 

15 performance, but it's also so that we can facilitate getting what they 

16 need in place. 

17 MR. BROWNING: And we wanted to make sure that 

18 the benchmarking wasn't just isolated to the corporate. I did send my 

19 maintenance manager with Joe and my engineering director, 

20 maintenance managers, and what I consider my line organization, 

21 engineering is going to have a heavy influence. And part of the 

22 overstaff that we talked about putting in place, a director that reports 

23 directly to me that oversees my Corrective Action Program and 

24 performance improvement came from Palo Verde. He had experience 

25 in their Column 4 recovery and he is now working directly for me as a 

26 permanent Entergy staff. 
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1 CHAIRMAN BURNS: Okay, very good. Thanks for 

2 those questions. I want to thank Commissioner Ostendorff for having 

3 gone out and visited recently. I do hope in terms of my own schedule 

4 and trying to schedule during this period a visit out there and we'll work 

5 with you on that. 

6 MR. MITCHELL: We'd certainly welcome a visit at 

7 any time. 

8 CHAIRMAN BURNS: Thanks. Commissioner 

9 Svinicki. 

10 COMMISSIONER SVINICKI: I want to thank all of 

11 you for being here today because this isn't the seat you want to find 

12 yourself in, so I think you've spoken very forthrightly. You have, of 

13 course, communicated, I think, with all members of our Commission. I 

14 appreciate also the brief message from Mr. Forbes. I think again all 

15 members of our Commission have had a chance to have him express 

16 his commitment to this recovery process and certainly especially as we 

17 get older, we learn that if we do not take care of ourselves, we can't take 

18 care of anything else. I wish him a constructive health outcome on 

19 anything he's dealing with right now. 

20 I have a little bit of the flip side experience in that I was 

21 at the station mere weeks before this event occurred and so when I 

22 heard about the stator drop it impacted me very deeply and I thought 

23 about why. I think there's two principal reasons. The first is that it is a 

24 reminder to all in the nuclear profession that walking through and 

25 saying "hmm, everything looks good. You know, it's all" -- that is no 

26 guarantee that there isn't something significant looming on the horizon. 
 87 

1 So I was taken aback by that. I had a very constructive visit there. 

2 The other thing that I was struck by in the community 

3 was how -- what an interconnected and tight community it is. So the 

4 other reason it impacted me was that I could simply project that it 

5 was -- because it included a very unfortunate loss of life, I'm sure that 

6 was devastating even one individual in a small, tight-knit community, 

7 that's felt very deeply. So I express my condolences to everyone in 

8 that regard. 

9 I think though maybe to look for a positive as 

10 Commissioner Ostendorff did, got a deep sense of family and 

11 community is a tool to you as you move through recovery process 

12 because there's too many references to how long I've been hanging 

13 around, but often I've walked through a few nuclear plants in the U.S. at 

14 this point and around the world, actually, but signage I sometimes see 

15 reminds station personnel that they are responsible for themselves, the 

16 safety of the facility, and each other. And it's that last part that I think 

17 you have a strong platform there that the station personnel feel like 

18 family. 

19 And Mr. Browning, I know from your resume you have 

20 some pretty deep roots there yourself. After service in the Navy as a 

21 young man, and thank you for your service, you also spent some time at 

22 Grand Gulf, but you spent a lot of time, you began there in 1990, as an 

23 entry level plant operator and so I think if anyone knows this, it's you. 

24 It can also be a kind a insularity, though, so there's a 

25 danger in it is that maybe you said we were resting a little bit on our 

26 confidence in ourselves and each other. And while that's a good thing, 
 88 

1 it's a double-edged sword. So I appreciate that. 

2 We did hear from Mr. Dapas. I ran out of time for 

3 reasons that I'm doing right now, I'm so verbose on everything, but he 

4 had made a commentary that they had found or were concerned 

5 about -- we get to cheat a little bit because we have his talking points. 

6 But in talking to Slide 34, he said "in summary, events and findings 

7 indicate that latent problems have existed in equipment." 

8 And then on his next slide, he said, "Equipment 

9 reliability has been relatively good." So I'm not trying to pick on Marc 

10 and he's not here at the table to defend his presentation, but I use it as 

11 an example of the complexity of what you are trying to diagnose. So 

12 on the one hand, we find and Marc gave the basis for the conclusion 

13 that we worry about latent equipment problems, but then one of the 

14 reasons that the staff rooted its decision that ANO could keep operating 

15 is operator performance was strong. Commissioner Ostendorff 

16 commented on that. And equipment reliability has been relatively 

17 good. So this is -- there's no easy -- if you could just go find one thing 

18 and fix it, good Lord, everyone would be so happy if that were the 

19 outcome. But it does make one wonder. 

20 One hears a lot about the economic pressures in the 

21 energy sector for generating stations, both fossil and nuclear, and all of 

22 them are under a lot of cost pressures. So one thing I would ask, 

23 although it's been communicated to the NRC, would you please repeat 

24 or state your commitment that as this improvement process unfolds, if 

25 station investment is needed that Entergy will provide that investment? 

26 Could you assure me of that? 
 89 

1 MR. MITCHELL: That's absolutely the case. And I'd 

2 like to amplify that a little bit because one of the lessons we're learning 

3 is our looks at equipment reliability have shown significant improvement 

4 in equipment reliability, not just at Arkansas Nuclear One, but across 

5 the fleet. However, it's an incomplete look. So that incomplete look, 

6 what we've learned is we need to be looking at more passive 

7 components, like flood barriers. We need to be looking at components 

8 that maybe wouldn't fall out as a critical component, but still could be 

9 risk significant as the auxiliary feedwater pump that Mr. Dapas talked 

10 about, so we're revamping the way -- we don't want to lose what we 

11 have with respect to equipment reliability, but we want to add more to it 

12 and that would be a core damage frequency, contributor kind of look at 

13 what things could influence the overall safety of the facility and then go 

14 attack those components that would be associated with that. So we're 

15 adding to our approach. And you have my commitment. 

16 COMMISSIONER SVINICKI: And I'll just close by 

17 saying that the really hard work now falls on the shoulders of the 

18 women and men working at ANO and all of you who are assisting them. 

19 So I certainly wish you luck in this very difficult workload that you have 

20 in front of you. 

21 Thank you, Chairman. 

22 CHAIRMAN BURNS: Thank you, Commissioner. I 

23 wanted to thank you for being here today and telling us about your 

24 plans and efforts to move forward to address the issues. And this is an 

25 important opportunity here for us as a Commission to review the 

26 performance of reactor and material licensees and to hear from the 
 90 

1 licensees like ANO here who have experienced a decline in 

2 performance and hear the plans to improve that performance and get 

3 back on the right track. So again, I'd like to thank you for your 

4 presentations here and thank the staff as well, and with that, we'll 

5 adjourn. Thank you. 

6 (Whereupon, the above-entitled matter went off the 

7 record at 11:37 a.m.) 

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