Audit Of NRC’s Transition Process For Decommissioning .
Audit of NRC’s TransitionProcess forDecommissioning PowerReactorsOIG-19-A-16August 23, 2019All publicly available OIG reports (including this report)are accessible through NRC’s Web site sp-gen
UNITED STATESNUCLEAR REGULATORY COMMISSIONWASHINGTON, D.C. 20555-0001OFFICE OF THEINSPECTOR GENERALAugust 23, 2019MEMORANDUM TO:Margaret M. DoaneExecutive Director for OperationsFROM:Dr. Brett M. Baker /RA/Assistant Inspector General for AuditsSUBJECT:AUDIT OF NRC’S TRANSITION PROCESS FORDECOMMISSIONING POWER REACTORS(OIG-19-A-16)Attached is the Office of the Inspector General’s (OIG) audit report titled Audit of NRC’sTransition Process for Decommissioning Power Reactors.The report presents the results of the subject audit. Following the August 13, 2019, exitconference, agency staff indicated that they had no formal comments for inclusion in thisreport.Please provide information on actions taken or planned on each of the recommendation(s)within 30 days of the date of this memorandum. Actions taken or planned are subject to OIGfollow-up as stated in Management Directive 6.1.We appreciate the cooperation extended to us by members of your staff during the audit. Ifyou have any questions or comments about our report, please contact me at (301) 415-5915or Jacki Storch, Team Leader, at (301) 415-2877.Attachment: As stated
Office of the Inspector GeneralU.S. Nuclear Regulatory CommissionDefense Nuclear Facilities Safety BoardResults in BriefWhy We Did This ReviewDecommissioning is the processused to safely remove a nuclearpower plant from service andreduce residual radioactivity to alevel that permits release of theproperty and termination of itsNRC operating license.The Office of Nuclear ReactorRegulation (NRR) maintainsoversight of all operatingnuclear power plants. The Officeof Nuclear Material Safety andSafeguards (NMSS) maintainsoversight of all decommissioningactivities. Once a licenseeannounces its intention to shutdown its reactor, NRR and NMSSclosely coordinate during this“operating to decommissioning”transition process.The audit objective was todetermine whether NRC’stransfer of oversightresponsibilities, used whenoperating power reactorsundergo decommissioning, isefficient and effective.OIG-19-A-16August 23, 2019Audit of NRC’s Transition Process for DecommissioningPower ReactorsWhat We FoundOIG found that NRC’s transfer of oversight responsibilities iseffective; however, the efficiency could be improved. Specifically,NRC should update decommissioning guidance and implement aformal project manager knowledge transfer process.Agency guidance states NRC should run its programs effectivelyand efficiently; however, NRC has not implemented certainknowledge management principles into the reactordecommissioning process. Consequently, there may beunnecessary delays in the processing and management of reactordecommissioning projects which may incur additional costs tolicensees, NRC, and taxpayers.What We RecommendThis report makes two recommendations to improve theeffectiveness and efficiency of the transition from operating todecommissioning power reactors.Agency Management stated their general agreement with thefinding and recommendations of this report.
Audit of NRC’s Transition Process for Decommissioning Power ReactorsTABLE OF CONTENTSABBREVIATIONS AND ACRONYMS . iI. BACKGROUND . 1II. OBJECTIVE . 5III. FINDING . 5Efficiency of NRC Decommissioning Practices Could beImproved . 5Recommendations . 15IV. AGENCY COMMENTS . 17APPENDIXESA. OBJECTIVE, SCOPE, AND METHODOLOGY . 18B. Total Hours for Decommissioning Activities ChargedSince Shutdown Fiscal Year 2012 – Fiscal Year 2018 .20C. Nuclear Power Plants with Announced PlannedShutdowns from 2019 to 2025 . .21TO REPORT FRAUD, WASTE, OR ABUSE . 22COMMENTS AND SUGGESTIONS . 22
Audit of NRC’s Transition Process for Decommissioning Power ReactorsABBREVIATIONS AND ACRONYMSNRCNuclear Regulatory CommissionPSDARPost-Shutdown Decommissioning Activities ReportNRROffice of Nuclear Reactor RegulationNMSSOffice of Nuclear Material Safety and SafeguardsPMProject Manageri
Audit of NRC’s Transition Process for Decommissioning Power ReactorsI. BACKGROUNDThe U.S. Nuclear Regulatory Commission (NRC) regulates thedecommissioning of commercial nuclear power plants. Decommissioningis the process used to safely remove a nuclear power plant from serviceand reduce residual radioactivity to a level that permits release of theproperty and termination of its NRC operating license. NRC has rulesgoverning commercial nuclear power plant decommissioning involving thecleanup of radioactively contaminated plant systems and structures andremoval of the radioactive fuel. These rules protect workers and thepublic during the entire decommissioning process and protect the publicafter the license is terminated.As of June 2019, there are 20 nuclear power reactors undergoingdecommissioning regulated by NRC (see Figure 1). Licensees in the U.S.have utilized two1 primary methods of decommissioning: “DECON” and“SAFSTOR.” Under the “DECON” method, soon after the plant closes,equipment, structures, and portions of the plant are immediately removedor decontaminated. Under the “SAFSTOR” method, a nuclear power plantis maintained and monitored to allow radioactivity to decay; afterward, theplant is dismantled and the property is decontaminated. The entiredecommissioning process may take up to 60 years. For a map of sitesthat have completed decommissioning or are undergoingdecommissioning, see Figure 1.A third method of decommissioning available to licensees called “entomb” involves the permanentencasement of radioactive contaminants in structurally sound material such as concrete. To date, noNRC-licensed facilities have implemented this option.11
Audit of NRC’s Transition Process for Decommissioning Power ReactorsFigure 1: Decommissioned Plants & Plants UndergoingDecommissioning as of June 2019.2Decommissioning ProcessWhen a nuclear power plantlicensee has determined toshut down a plantpermanently, it must submit awritten certification of thisdecision to NRC within 30days. When all nuclear fuelis permanently removed fromthe reactor vessel, thelicensee must also submit aSource: NRCwritten certification ofpermanent fuel removal toNRC. Upon NRC’s receipt of both certifications, the licensee is no longerauthorized to operate the reactor or load fuel into the reactor vessel. Priorto or within 2 years after the licensee permanently ceases operations, thelicensee must submit a post-shutdown decommissioning activities report(PSDAR) to NRC. This report provides a description of the planneddecommissioning activities, a schedule for accomplishing them, and anestimate of the expected costs.NRC’s goal is to make the report available for public review and commentand hold a public meeting near the reactor within 90 days of receiving thePSDAR. The licensee may begin major decommissioning activities 90days after it has submitted the PSDAR and both required certifications.Major decommissioning activities can include permanent removal of majorcomponents like the reactor vessel, steam generators, and large pipingsystems, pumps, and valves. At least 2 years before the expected licensetermination, the licensee is required to submit a license termination planfor NRC’s approval. This plan addresses site characterization and siteremediation, final radiation surveys, and site release, among others.There are 10 decommissioned reactors as indicated by the “Independent Spent Fuel StorageInstallation” and “License Terminated” sites. The map displays an additional 20 reactors currentlyundergoing the decommissioning process. San Onofre Nuclear Generating Station, Units 2 and 3, andZion Nuclear Power Station, Units 1 and 2, are currently in active decommissioning.22
Audit of NRC’s Transition Process for Decommissioning Power ReactorsHandoff of Oversight ResponsibilitiesThe Office of Nuclear Reactor Regulation (NRR) maintains oversight of alloperating nuclear power plants. The Office of Nuclear Material Safety andSafeguards (NMSS) maintains oversight of all decommissioning activities.Once a licensee announces its intention to shut down its reactor, NRR andNMSS closely coordinate during this “operating to decommissioning”transition process.3 This process begins when the licensee announces itsplans to permanently shut down the plant. This transition processincludes the two certifications licensees must submit to NRC, as well asthe PSDAR submission, and any license amendments and exemptionsthat must be approved by NRR and/or NMSS staff. Once these itemshave been completed and the updated defueled technical specifications4are approved by NRR, the official handoff to NMSS occurs. Thiscompletes the NRC’s transition of its oversight of the plant from anoperating reactor to a decommissioning facility, and NMSS now has fullresponsibility of the power reactor and oversees the remainder of thedecommissioning.License Amendments & ExemptionsOne of NRC’s primary responsibilities during the operating todecommissioning transition process is the review of licensee amendmentand exemption requests. Currently, most of NRC’s regulations do notspecifically address reactor decommissioning. Specifically, many ofNRC’s regulations and some conditions of the license holddecommissioning reactors to the same standard, and the samerequirements, as operating reactors. This includes employing the samenumber of emergency response staff, or maintaining the same physicalsecurity requirements, even after the site has shut down and there is nolonger fuel in the reactor core. Consequently, after licensees announcetheir intent to decommission, they will submit several requests for NRC’s3NRR still has primary oversight responsibilities during this point in the transition process.4Technical specifications are part of an NRC license authorizing the operation of a power plant. Theyestablish requirements for items such as safety limits, surveillance requirements, design features, andadministrative controls. When a licensee begins the decommissioning process, its standard technicalspecifications are updated to defueled technical specifications to reflect the decommissioning status ofthe power reactor.3
Audit of NRC’s Transition Process for Decommissioning Power Reactorsreview to exempt them from regulations that primarily apply to operatingreactors and amend their licenses toPictured: Connecticut Yankee during thealign with planned decommissioningdecommissioning process.activities rather than reactor operations.NRC has approved such requestsbased on the much lower risk withdecommissioning reactors, ascompared to operating reactors, due tothe nuclear fuel being removed.Nevertheless, the process for preparingand reviewing these exemption andamendment requests requires acommitment of resources by both thelicensee and NRC staff.Decommissioning Reactor RulemakingSource: NRCBeginning in the late 1990s, it becameapparent to NRC that it should considerrulemaking to improve the efficiency and effectiveness of the powerreactor decommissioning process. A decommissioning rulemaking effortwas initiated to address the transition issues, but it was subsequentlysuspended because of a shift in agency priorities following the terroristattacks on September 11, 2001. However, in 2014, the Commissiondirected NRC staff to proceed with rulemaking on reactordecommissioning. Major provisions of the proposed rule include changesin areas such as emergency preparedness, physical security, cybersecurity, drug and alcohol testing, certified fuel handler training, andforeign ownership, among others. If the proposed rule’s current iteration isapproved, it would streamline the decommissioning process and eliminateapproximately 13 licensing actions (e.g., exemptions and amendments)per decommissioning that NRC staff must process. NRC staff submittedthe draft proposed rule to the Commission for review in May 2018.4
Audit of NRC’s Transition Process for Decommissioning Power ReactorsII. OBJECTIVETo determine whether NRC’s transfer of oversight responsibilities, usedwhen operating power reactors undergo decommissioning, is efficient andeffective. Appendix A contains information on the audit scope andmethodology.III. FINDINGNRC’s transfer of oversight responsibilities is effective; however, theefficiency could be improved. Specifically, NRC should Update decommissioning guidance, andImplement a formal project manager knowledge transfer process.A. Efficiency of NRC Decommissioning Practices Could beImprovedThough effective, NRC’s decommissioning process could be moreefficient. Agency guidance states NRC should run its programs effectivelyand efficiently; however, NRC has not implemented certain knowledgemanagement principles into the reactor decommissioning process.Consequently, there may be unnecessary delays in the processing andmanagement of reactor decommissioning projects which may incuradditional costs to licensees, NRC, and taxpayers.5
Audit of NRC’s Transition Process for Decommissioning Power ReactorsWhat Is RequiredAgency guidance states NRC should run its programs effectively andefficiently.Project Aim seeks to enhance the culture of NRC to increase efficiency,effectiveness, agility, and flexibility of NRC work processes. NRC’s goal isto improve agency processes by streamlining, standardizing, and clarifyingroles and responsibilities so that resources are used more wisely.What We FoundThough effective, NRC’s decommissioning process could be moreefficient.Currently, there is no standard method to decommission power reactorsas the process is dynamic and there are many variables involved. NRC isstill adjusting to the changes occurring in reactor decommissioning space,and this is further exacerbated by the lack of updated agency guidanceand the absence of a reactor decommissioning knowledge transferprocess for NRC staff.Recent HistoryStarting in early 2013 and through the end of 2014, five power reactorspermanently ceased operations. These were the first reactors to transitionto decommissioning since 1998. Out of the five power reactor shutdowns,four were unexpected and involved little pre-planning by licensees andNRC. Because it had been 15 years since any reactor had entereddecommissioning, licensees and NRC staff initially had limited experiencein processing decommissioning licensing actions. Furthermore, NRC’sregulations were generally not written to address reactordecommissioning.6
Audit of NRC’s Transition Process for Decommissioning Power ReactorsFrom 2013 through 2015, NRC had to process over 70 decommissioningrelated licensing actions and other regulatory activities for the fivedecommissioning reactors. Since the last round of decommissionings,process changes occurred including the need to review and processmultiple concurrent licensing action applications (from multiple licensees).From a knowledge management perspective, licensees and NRC staffwere both working on steep learning curves.NRC formed a decommissioning working group to study and documentthese recent decommissionings, as well as to develop a lessons learnedreport5 to assist in future power reactor decommissionings.New Business ModelIn October 2018, NRC staff issued an order approving the permanentlicense transfer of the Vermont Yankee operating license from the originalowner (Entergy) to a new decommissioning company (NorthStar). Theidea behind this new business model is decommissioning companiespossess the required expertise and can complete the decommissioningprocess more quickly and efficiently than the company that operated thereactor. These transactions typically include switching the licensee’sdecommissioning plan from SAFSTOR to DECON, thereby potentiallyreducing the decommissioning timeline from 60 years down to possibly 10years. According to NRC staff, this business model appears to be the“wave of the future” and NRC is currently reviewing several other licensetransfer requests of this kind. Because this new business model presentsa compressed decommissioning time frame, and each power reactor isdifferent and presents its own unique challenges, NRC is still learning howto work with these types of license transfer requests.NRC Billing Practices During the Transition PeriodThe audit team analyzed NRC’s billing practices; specifically, to identify ifthere may have been incorrect licensee billing during the transition periodwhen both NRR and NMSS were involved in the reactor decommissioning5Power Reactor Transition from Operations to Decommissioning, Lessons Learned Report, October2016. Henceforth, this report shall be referred to as the Lessons Learned Report.7
Audit of NRC’s Transition Process for Decommissioning Power Reactorsprocess. The audit team reviewed raw cost activity code data provided bythe Office of the Chief Financial Officer to evaluate whether there mayhave been overlap in licensee fee billing during the transition periodbetween NRR and NMSS. The audit team also reviewed the agency’sforecasted number of full-time equivalents to be used for decommissioningactivities and compared it with the number expended to identify anypossible large discrepancies. The data analysis did not indicate anyevidence of unjustified billing charges or unreasonable fluctuations in fulltime equivalents during reactor decommissioning. In fact, the dataanalysis displayed strong coordination between the two program offices,and this was further supported by interviews with licensees. SeeAppendix B for NRR and NMSS billing hours data analyses.Why This OccurredNRC has not incorporated certain knowledge management principlesfor reactor decommissioning.Two basic knowledge management6 principles, guidance and knowledgetransfer, have not been effectively implemented into NRC’s power reactordecommissioning processes.GuidanceBoth NRR and NMSS’ office guidance documents related to power reactordecommissioning are outdated. NRR’s guidance document, OfficeInstruction-COM 101, was last updated in 2002. NMSS’ guidancedocument, Policy & Procedure 5-1, was last updated in 2016. However,this update simply addressed an office name change due to an internalreorganization, and this document has seen little substantive revisionsince it was originally written in 2007.7 Additionally, Regulatory Guide6Knowledge management is a practical, process-orientated approach to how agencies and departmentscapture institutional knowledge and learn from it. Knowledge management ensures that all necessaryelements (accountabilities, processes, technologies, and governance) are in place and interconnected.This ensures that there are no gaps in the system, and that knowledge flows freely through theorganization.Policy & Procedure 5-1 was revised in 2010, but the revision clarified NRC’s financial assurance reviewresponsibilities which is outside the scope of this audit.78
Audit of NRC’s Transition Process for Decommissioning Power Reactors1.184, which provides guidance to licensees on the actions required todecommission power reactors, was last updated in 2013.Despite the evolution of the decommissioning process, these primaryguidance documents remained largely unchanged since their initialinception. Not surprisingly, some staff stated t
Audit of NRC’s Transition Process for Decommissioning Power Reactors . plant is dismantled and the property is decontaminated. The entire decommissioning process may take up to 60 years. For a map of si
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