[Federal Register Volume 61, Number 238 (Tuesday, December 10, 1996)]
[Notices]
[Pages 65085-65088]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-31323]


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NUCLEAR REGULATORY COMMISSION

Niagara Mohawk Power Corporation Nine Mile Point, Unit 1; Order 
Imposing a Civil Monetary Penalty

[Docket No. 50-220, License No. DPR-63, EA 96-079]

I.

    Niagara Mohawk Power Corporation (Licensee) is the holder of 
Operating License No. DPR-63 (License), issued by the Nuclear 
Regulatory Commission (NRC or Commission). The License authorizes the 
Licensee to operate the Nine Mile Point Unit 1 nuclear facility in 
accordance with the conditions specified therein.

II.

    An inspection of the Licensee's activities was conducted between 
February 17 and March 11, 1996. The results of this inspection 
indicated that the Licensee had not conducted its activities in full 
compliance with NRC requirements. A written Notice of Violation and 
Proposed Imposition of Civil Penalty (Notice) was served upon the 
Licensee by letter dated June 18, 1996. The Notice states the nature of 
the violations, the provisions of the NRC's requirements that the 
Licensee had violated, and the amount of the civil penalty proposed for 
the violations.
    The Licensee responded to the Notice in a letter dated July 16, 
1996. In its response, the Licensee admitted the two violations 
assessed a civil penalty in Section I of the Notice, but requested that 
the penalty be mitigated. In addition, the Licensee denied the two 
violations in Section II of the Notice that were classified 
individually at Severity Level IV and not assessed a civil penalty. The 
Licensee provided a supplemental response, dated August 15, 1996, in 
which the Licensee subsequently admitted one of the Severity Level IV 
violations that it had denied in the July 16, 1996 response.

III.

    After consideration of the Licensee's response and the statements 
of fact, explanation, and argument for mitigation contained therein, 
the NRC staff has determined, as set forth in the Appendix to this 
Order, that the violations for which the civil penalty was proposed 
occurred as stated in the Notice, and that an adequate basis was not 
provided for mitigation of the civil penalty. Therefore, the penalty 
proposed for the violations designated in Section I of the Notice 
should be imposed.

IV.

    In view of the foregoing and pursuant to Section 234 of the Atomic 
Energy Act of 1954, as amended (Act), 42 U.S.C. 2282, and 10 CFR 2.205, 
It Is Hereby Ordered That:
    The Licensee pay a civil penalty in the amount of $50,000 within 30 
days of the date of this Order, by check, draft, money order, or 
electronic transfer, payable to the Treasurer of the United States and 
mailed to the Director, Office of Enforcement, U.S. Nuclear Regulatory 
Commission, One White Plant North, 11555 Rockville Pike, Rockville, MD 
20852-2738.

V.

    The Licensee may request a hearing within 30 days of the date of 
this Order. Where good cause is shown, consideration will be given to 
extending the time to request a hearing. A request for extension of 
time must be made in writing to the Director, Office of Enforcement, 
U.S. Nuclear Regulatory Commission, Washington, D.C. 20555, and include 
a statement of good cause for the extension. A request for a hearing 
should be clearly marked as a ``Request for an Enforcement Hearing'' 
and shall be addressed to the Director, Office of Enforcement, U.S. 
Nuclear Regulatory Commission Washington, D.C. 20555, with a copy to 
the Commission's Document Control Desk, Washington, D.C. 20555. Copies 
also shall be sent to the Assistant General Counsel for Hearings and 
Enforcement at the same address and to the Regional Administrator, NRC 
Region I, 475 Allendale Road, King of Prussia, Pennsylvania 19406.
    If a hearing is requested, the Commission will issue an Order 
designating the time and place of the hearing. If the Licensee fails to 
request a hearing within 30 days of the date of this Order, or if 
written approval of an extension of time in which to request a hearing 
has not been granted, the provisions of this Order shall be effective 
without further proceedings. If payment has not been made by that time, 
the matter may be referred to the Attorney General for collection.
    In the event the Licensee requests a hearing as provided above, the 
issues to be considered at such hearing shall be:

whether, on the basis of the violations set forth in Section I of the 
Notice that the Licensee admitted, this Order should be sustained.

    Dated at Rockville, Maryland this 3rd day of December 1996.

For the Nuclear Regulatory Commission.
James L. Milhoan,
Deputy Executive Director for Nuclear Reactor Regulation, Regional 
Operations and Research.

Appendix

Evaluation and Conclusion

    On June 18, 1996, a Notice of Violation and Proposed Imposition of 
Civil Penalty (Notice) in the amount of $50,000 was issued to the 
Niagara Mohawk Power Corporation (licensee) for violations of NRC 
requirements. Two of the violations were classified in the aggregate at 
Severity Level III, and a $50,000 civil penalty was proposed. Two other 
violations were classified individually at Severity Level IV. The 
licensee responded to the Notice on July 16, 1996, and admitted the two 
violations for which a penalty was proposed, but requested that the 
penalty

[[Page 65086]]

be mitigated. The licensee also denied the two violations that were not 
assessed a penalty. In a supplemental response, dated August 15, 1996, 
the licensee admitted one of the Severity Level IV violations that it 
had denied in the July 16, 1996 response. The NRC's evaluation and 
conclusion regarding the licensee's requests are as follows:

1. Restatement of Violations

    A. Title 10 of the Code of Federal Regulations, Part 50, (10 CFR 
50), Appendix B, Criterion III, ``Design Control,'' requires that 
measures be established to verify the adequacy of design, such as by 
design reviews, alternate or simplified calculational methods, or 
suitable testing.
    Nine Mile Point Unit 1 Updated Final Safety Analysis Report 
(UFSAR), Sections VI.C.1.2 and III.A.1.2, state that the reactor and 
turbine building pressure relief panels will blow out at 45 pounds per 
square foot (psf) to prevent failure of the building superstructures at 
an internal pressure in excess of 80 psf.
    Contrary to the above, between October 1993 and March 1995, 
measures established failed to verify the adequacy of design for Unit 1 
reactor and turbine building pressure relief panels to blow out at the 
specified pressures. Specifically, in October 1993, NMPC made an error 
in the assumptions for calculations regarding the installed, oversized 
bolts in the reactor and turbine building pressure relief panels. The 
error was not identified, during the review process, by either the 
independent engineering reviewer or approver. It was not recognized 
until March 1995 that the relief pressures were in excess of the 
designed blowout pressure of the superstructures. (01013)
    B. 10 CFR 50.59(a)(1), allows, in part, the holder of a license to 
make changes to the facility as described in the safety analysis report 
unless the proposed change involves an unreviewed safety question.
    10 CFR 50.59(b)(1) requires, in part, the licensee to maintain 
records of changes in the facility, to the extent that these changes 
constitute changes in the facility as described in the safety analysis 
report. The records must include a written safety evaluation which 
provides the bases for the determination that the change does not 
involve an unreviewed safety question.
    Nine Mile Point Unit 1 UFSAR Sections VI.C.1.2 and III.A.1.2 state 
that the reactor and turbine building pressure relief panels will blow 
out at 45 psf to prevent failure of the building superstructure at an 
internal pressure in excess of 80 psf.
    Contrary to the above, from December 1969 to March 1995, the actual 
design configuration of the reactor and turbine building pressure 
relief panels was different from that described in the UFSAR, and 
Niagara Mohawk Power Corporation (NMPC) did not perform the required 
written safety evaluation to provide the bases for a determination that 
the deviation from the UFSAR description did not involve an unreviewed 
safety question. Specifically, in October 1993, NMPC identified that 
the wrong size bolts had been installed in the relief panels during 
initial construction. Calculations revealed that the reactor and 
turbine building pressure relief panels would not relieve until 53 and 
60 psf, respectively. Subsequent calculations revealed that the panels 
would not relieve until the pressure was in excess of the 
superstructure design blowout pressure of 80 psf stated in the UFSAR, 
and the licensee neither performed the evaluation required by 10 CFR 
50.59, nor did it undertake adequate corrective action to restore the 
facility to the licensing basis configuration as specified in the 
UFSAR. (01023)
    This is a Severity Level III problem (Supplement I). Civil 
Penalty--$50,000

2. Summary of Licensee Response Requesting Mitigation of the Penalty

    In its July 16, 1996 response, the licensee admitted the two 
violations for which the civil penalty was proposed and stated its 
belief that a civil penalty is not warranted. In support of this 
belief, the licensee noted that the deficiencies in the blowout panel 
construction do not represent a significant safety issue; the blowout 
panels would have functioned as designed to prevent failure of the 
building superstructures; and the panels would only function in the 
event of a high energy line break outside containment, a scenario that 
the licensee indicated is not considered a design basis event for NMP-
1.
    The licensee also expressed concern that the violations and civil 
penalty may be the result of applying a relatively recent regulatory 
position and philosophy to actions that occurred over three years ago. 
The licensee noted that it appears that the NRC is considering all 
statements and commitments in the UFSAR as ``stand-alone'' regulatory 
requirements, and has applied a new and restrictive interpretation to 
the definition of ``margin of safety'' terminology in 10 CFR 50.59. The 
licensee further notes that the plant condition was identified by its 
staff as a result of a proactive evaluation to resolve a minor 
discrepancy in the UFSAR.
    The licensee further noted in support of its mitigation request 
that it had not been assessed a penalty since 1992; that it has 
demonstrated a proactive approach to safety; and, contrary to a 
statement in the NOV transmittal letter, that it took immediate actions 
to restore the pressure relief panels to a condition consistent with 
the UFSAR once the calculational error was discovered, and the NRC did 
not appear to give any credit for this.

3. NRC Evaluation of Licensee Response

    The NRC has carefully considered the licensee's response and 
concludes that the licensee has not provided an adequate basis for 
mitigation of the civil penalty.
    Although the licensee did not specifically contest the Severity 
Level classification of the two violations in Section I of the Notice, 
the licensee appears to take issue with that classification by 
indicating that the deficiencies in the pressure relief panel 
construction do not represent a significant safety issue. The NRC 
concedes that the pressure relief panels likely would have functioned 
as designed to prevent failure of the building superstructures,\1\ and 
the panels function only in the event of a high energy line break 
outside containment, which is not considered a design basis event for 
NMP-1. However, the NRC notes that the full resolution of this issue is 
still under the licensee's evaluation. Notwithstanding the result of 
that resolution, the NRC maintains that the two violations represent a 
significant regulatory concern and, therefore, were classified 
appropriately in the aggregate at Severity Level III.
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    \1\ This NRC position is based on more recent licensee reviews 
performed after the enforcement conference, which determined that 
both the reactor and turbine buildings would be capable of 
withstanding internal pressures in excess of 100 psf without 
superstructure failure.
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    In making this determination, the NRC considered the fact that this 
condition (the actual design configuration of the pressure relief 
panels was different from that described in the UFSAR) existed for 
approximately 26 years, without any written safety evaluation to 
provide the basis for a determination that the deviation from the UFSAR 
description did not involve an unreviewed safety question. A number of 
facts are most noteworthy: (1) the licensee identified, in October 
1993, that the wrong size bolts (\1/4\-inch diameter, as opposed to the 
correct sized \3/16\-inch diameter bolts) had been installed in the 
relief

[[Page 65087]]

panels during initial construction, (2) the licensee's October 1993 
evaluation of the wrong bolts utilized assumptions inconsistent with 
the assumptions described in the UFSAR \2\ and (3) a subsequent review, 
in March 1995, of the evaluation performed in October 1993, revealed 
that the assumptions were incorrect and that the panels would not 
relieve until the pressure was in excess of the superstructure design 
blowout pressure stated in the UFSAR (80 psf). Nonetheless, the 
licensee neither performed the required evaluation, nor undertook 
adequate corrective action to restore the facility to the licensing 
basis configuration as specified in the UFSAR. Given the length of time 
this condition existed, the inappropriate and inconsistent use of 
assumptions not described in the UFSAR, and the failure to promptly 
resolve and take appropriate action to address the issue of building 
overpressure when indications of a problem surfaced in 1993, the NRC 
contends that the violations represent a significant regulatory concern 
and were classified appropriately at Severity Level III.
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    \2\ The UFSAR description of the failure mode was the panel 
bolts shearing (one-way process analysis resulting in calculated 
failures of 94 psf and 92 psf for the reactor and turbine building, 
respectively). However, the licensee chose to analyze the panel 
relieving process by using a metal tearing failure mode (two-way 
process analysis resulting in calculated failures of 53 psf and 60 
psf for the reactor and turbine building, respectively).
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    With regard to the licensee's concern that the violations and 
imposition of a civil penalty may be the result of applying a 
relatively recent regulatory position and philosophy to actions that 
occurred over three year ago, Violations I.A and B involve the 
licensee's original construction installation of incorrect-sized bolts 
on the pressure relief panels, resulting in a change to the facility 
from that described in the plant's UFSAR, without preparing a written 
safety evaluation as required by 10 CFR 50.59. The NRC has always 
regarded such a change as requiring a written safety evaluation in 
accordance with 10 CFR 50.59. Thus, there has been no change in the 
NRC's interpretation of this requirement as it applies to the changes 
addressed in Violations I.A and B.
    The NRC also acknowledges that this plant condition was identified 
by the licensee staff as a result of a proactive evaluation to resolve 
a discrepancy in the UFSAR, and the licensee has not been assessed a 
penalty since 1992. These factors were considered by the NRC as part of 
the civil penalty assessment process set forth in the NRC Enforcement 
Policy (NUREG-1600), as were the licensee's corrective actions. In 
addition, although the NRC acknowledges that the licensee took 
immediate actions to restore the pressure relief panels to a condition 
consistent with the UFSAR once the calculational error was discovered, 
the NRC maintains that no credit was warranted for these corrective 
actions. In October 1993, the licensee identified that the wrong bolts 
had been installed in 1969, and calculated the relief pressures to be 
53 psf for the reactor building and 60 psf for the turbine building. 
This calculation was in error, and the relief pressures were actually 
in excess of 80 psf as the licensee identified in March 1995, at which 
time the licensee removed every other bolt to place themselves in a 
condition that the licensee believed was in compliance with the UFSAR. 
It was not until after being questioned by the NRC prior to the 
conference, that the licensee identified that the March 1995 
calculations were also wrong. In addition, the calculations used to 
support the removal of every other bolt were flawed, yet the licensee, 
at the time of the enforcement conference, had not completed the 
evaluation required pursuant to 10 CFR 50.59 to change the UFSAR. 
Therefore, the NRC maintains that credit is not warranted for the 
licensee's corrective actions, which according to the Enforcement 
Policy, results in a civil penalty of $50,000 being assessed. The NRC 
concludes that the penalty for this Severity Level III problem should 
not be mitigated.

4. Restatement of Violation II.B

    10 CFR 50.72(b)(1)(ii)(B), requires, in part, that the licensee 
shall notify the NRC as soon as practical and in all cases within one 
hour of the occurrence of any event or condition, during operation, 
that results in the nuclear power plant, including its principal safety 
barriers, being seriously degraded or in a condition that is outside 
the design basis of the plant.
    10 CFR 50.73(a)(2)(ii)(B) requires that the licensee shall submit a 
Licensee Event Report (LER) within 30 days of the discovery of any 
event or condition that results in the condition of the nuclear power 
plant, including its principal safety barriers being seriously degraded 
or in a condition that is outside the design basis of the plant.
    Contrary to the above, in October 1993, NMPC did not notify the NRC 
within one hour of the discovery of a condition outside the design 
basis of the plant, nor did NMPC submit a LER within 30 days of 
discovery of a condition outside the design basis of the plant. 
Specifically, with the plant operating, NMPC determined that the actual 
blowout pressures of the reactor and turbine building pressure relief 
panels were in excess of the buildings' design basis pressures 
identified in the Unit 1 UFSAR, and NMPC failed to make and submit the 
required reports in the required time periods. (02024)
    This is a Severity Level IV Violation (Supplement I).

5. Licensee Response Denying Violation II.B

    The licensee, in disagreeing with this violation, noted that in 
October of 1993, the calculations associated with the oversized bolts 
in the blowout panels indicated that the reactor and turbine building 
panels would relieve at internal pressures of 53 and 60 psf, 
respectively, and the UFSAR indicated that the buildings' design basis 
pressure was in excess of 80 psf. The licensee, therefore, concluded 
that this situation was not reportable even though the calculated 
blowout pressures did exceed the 45 psf nominal value for bolt failure 
as indicated in the UFSAR.
    The licensee stated that in reaching this conclusion, it considered 
the guidance in NUREG-1022, ``Event Reporting Guidelines 10 CFR 50.72 
and 50.73,'' and various statements in the Federal Register (FR) 
related to the reportability rule. The licensee notes that NUREG-1022 
provides an example where high energy line break restraints are not 
installed, but indicates that this would not be considered reportable 
if analysis shows that the particular missing restraints are not needed 
for compliance with the design basis. The licensee further indicates 
that the preamble to the final rule in the August 29, 1983, FR notes, 
in regard to this section of the rule, that ``[i]t is not intended that 
this paragraph apply to minor variations in individual parameters or to 
problems concerning single pieces of equipment.'' The licensee also 
noted that an April 8, 1993 FR states: ``Furthermore, the wording of 
the criteria and the guidance in the preamble to the final rule imply 
that this impact on plant safety should be at a fairly high level,'' 
and ``Therefore, failure, specification problems, and loss of safety 
margins that apply to individual components are not reportable unless 
they effect the ability to satisfy plant safety functions 3.''
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    \3\ 58 FR 18167, 18174, April 8, 1993
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    The licensee indicated that, based on the above guidance, it 
concluded in October of 1993 that the calculated blowout pressures of 
53 and 60 psf for the reactor and turbine buildings, respectively, 
would still have the ability

[[Page 65088]]

to satisfy the plant design basis. Specifically, the blowout panels 
would still protect the buildings' superstructure from failure, which 
was considered the plant design basis. The licensee contended that the 
45 psf value is not considered the plant design basis for reportability 
considerations and none of the principle safety barriers was seriously 
degraded. Therefore, the licensee does not consider that this condition 
was reportable given the information available in October 1993, and 
therefore disagrees with this violation.
    The licensee also notes that the description of the violation in 
the Notice of Violation, and particularly, the discussion of the 
violation in the transmittal letter, suggests that the NRC is applying 
a relatively recent regulatory position regarding the status of 
numerical values within the UFSAR. Specifically, the licensee states 
that it appears that the NRC is considering all statements and 
commitments in the UFSAR as ``stand-alone'' requirements. The licensee 
further notes that while stated in the second paragraph on page two of 
the NOV transmittal letter, but not cited as such in any of the 
violations, it appears that the NRC considers that the failure of the 
blowout panels to function at the UFSAR stated pressure of 45 psf is, 
in itself, a violation of regulatory requirements and a reportable 
situation. The licensee disagrees with this interpretation of the legal 
significance of the UFSAR, and is participating with the Nuclear Energy 
Institute (NEI) to initiate a dialogue with the NRC regarding the 
resolution of this generic issue. The licensee further states that 
notwithstanding its efforts to reach agreement on what the 
interpretation of information in the UFSAR should be, the licensee 
believes that it is clear that the NRC's regulatory interpretation is 
inconsistent with the previously issued guidance on reportability as 
referenced in the licensee's response.

6. NRC Evaluation of Licensee Response

    The NRC agrees that the licensee, based on its erroneous 
calculations in October 1993, concluded that the pressure relief panels 
would provide relief at values below the reactor and turbine building 
superstructure failure pressure of 80 psf. While the licensee clearly 
should have been aware that the pressure relief panels would provide 
relief at values above the 80 psf superstructure pressures if the 
calculation had been adequately performed, it is also clear that the 
licensee could not report a condition that it was not aware of, even 
though it should have been aware of the condition. Nonetheless, the 
licensee was aware that the panels' pressure relief values calculated 
in 1993 were above the stated value of 45 psf stated in the UFSAR at 
which the panels were supposed to provide relief. The NRC maintains 
that the licensee was outside of its design basis and decreased the 
margin to the pressure that would cause building failure and, 
therefore, the deviation from the UFSAR should have been reported to 
the NRC.
    The NRC maintains this position, notwithstanding the licensee's 
contention that the guidance in NUREG-1022 would suggest that the 
condition was not reportable. The NRC believes that the licensee 
misinterpreted the NUREG-1022 guidance and in so doing, failed to 
report the subject condition to the NRC. Simply stated, the licensee's 
analogy of a missing high energy line break restraint, which 
subsequently is analyzed as not being required for compliance with the 
design basis, is not applicable to the pressure relief panels, a single 
component which provides a significant function in protecting the 
building superstructure in the event of an overpressure transient of 
the reactor or turbine buildings.

7. NRC Conclusion

    The NRC concludes that the licensee has not provided an adequate 
basis for mitigating the civil penalty. Accordingly, the NRC has 
determined that a monetary civil penalty in the amount of $50,000 
should be imposed for the violations in Section I of the June 18, 1996 
Notice. In addition, the licensee has not provided an adequate basis 
for the withdrawal of Violation II.B in the Notice.

[FR Doc. 96-31323 Filed 12-9-96; 8:45 am]
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