Opinion ID: 1778943
Heading Depth: 2
Heading Rank: 1

Heading: the outages and outage extensions at river bend

Text: The Commission examined twenty-six outages and refueling outage extensions at River Bend that occurred between October, 1991, and December, 1994, (the review period). As we explained in Phase I, there are two different types of outages, the refueling outage, which is a planned outage, and a forced outage, which is an unplanned outage. All nuclear power plants must schedule refueling outages to replace spent fuel. During refueling outages, the Company takes advantage of the down time to conduct maintenance, inspections and testing that cannot safely be performed while the nuclear reactor is in operation. Because it is planned and scheduled in advance, a refueling outage is considered a planned outage. [8] By contrast, a forced outage occurs when the plant shuts down automatically or manually in response to unplanned problems like system failures, equipment failures, or incidents such as a fire or an explosion. Gulf States Util. Co., supra, 96-2046 p. 14, 689 So.2d at 1346. River Bend had an extremely high outage rate during the review period. Commission Staff expert, Dr. William R. Jacobs, Jr., Ph. D., testified that the Cumulative Forced Outage Rate (CFOR) ... was 25.97%, an extremely high rate by industry standards. [9] Dir. Test. Dr. Jacobs p.12, L.P.S.C. (6/30/95). The CFOR is a measure of the lost energy generation due to forced outages and is similar to a performance indicator used by the Institute of Nuclear Power Operation (INPO) called the Unplanned Capability Loss Factor (UCLF). Id. Dr. Jacobs explained that the INPO monitors nuclear reactors around the nation and assesses their performance under this indicator. Id. This parameter is similar to the Forced Outage Rate and is defined to be the percentage of maximum energy generation that a plant is not capable of supplying to the electrical grid because of unplanned energy losses, such as unplanned shutdowns or outage extensions. Id. The UCLF is broader than the CFOR because it includes not only forced outages but also extensions to planned outages. Id. Because the UCLF has a broader scope, the figure is usually higher than the CFOR. Id. Thus, with River Bend achieving a 25.97% CFOR compared against the average INPO reported UCLF for all U.S. reactors for the years 1992, 1993, and 1994, which were 6.8%, 4.3%, and 5.4%, Dr. Jacobs demonstrated that River Bend's outage rate was almost five times the national average. Id. When a nuclear generating station suffers an outage, whether forced or planned, the Company cannot provide electricity from the reactor, requiring its customers to be supplied with electricity from other sources. The expenses of providing replacement power may be properly included in the fuel adjustment clause charges billed to ratepayers and will be allowed upon the Commission's fuel clause review if the outage was not caused by the Company's imprudence. Otherwise, the replacement power costs will be properly borne by the Company, rather than the ratepayers. A determination of whether the replacement power costs are imprudent is made by the Commission after an examination of the root cause of the outage or extension that facilitated the need for replacement power. If the outage or extension was caused by the Company's imprudence, the Commission will conclude that the replacement power costs were imprudent, and they will be disallowed. Upon disallowance, the Commission orders the replacement power costs previously collected through the fuel adjustment charge refunded to the Company's ratepayers. When the Commission conducts a fuel adjustment clause review, the Company must demonstrate that it acted prudently in incurring fuel costs, including any replacement power costs. Gulf States Util. Co. v. Louisiana Pub. Serv. Comm'n., 578 So.2d 71, 84 (La. 1991) (quoting In Re Cambridge Electric Light Co., 86 P.U.R.4th 574 (Mass.D.P.U. 1987)). In order to carry this burden with regard to outage related replacement power costs, the Company must demonstrate that its decisions and actions that lead to the outage were prudent. Id. To this end, the utility must show that it went through a reasonable decision making process to arrive at a course of action and, given the facts as they were or should have been known at the time, responded in a reasonable manner. Id. [T]he focus in a prudence inquiry is not whether a decision produced a favorable or unfavorable result, but rather, whether the process leading to the decision was a logical one, and whether the utility company reasonably relied on information and planning techniques known or knowable at the time. Although a prudence review is necessarily retrospective in that it involves an examination of past circumstances, past information available, and past decisions, these factors may not be evaluated in light of subsequent knowledge. Gulf States Util. Co. v. Louisiana Pub. Serv. Comm'n., supra, 578 So.2d at 85 (internal citations omitted). If the Company fails to carry its burden, it will be saddled with those replacement power costs and will be, as in this case, ordered to refund any such costs previously billed to the customers through the fuel adjustment charge.