Minutes of the Diablo Canyon Independent Safety Committee October 2006 Public Meeting [17th Annual Report, Exbibit B.3] (As approved at the January 31-February 1, 2007, Public Meeting.)

Tuesday & Wednesday, October 18-19, 2006, Shell Beach, California

Notice of Meeting

A legal Notice of Meeting was published in local newspapers, along with several display advertisements, and was mailed to the media and those persons on the Committee’s service list. A copy of the meeting agenda was also posted on the Committee’s website at www.dcisc.org.

Agenda

I. Call to Order - Roll Call

The October 18, 2006, public meeting of the Diablo Canyon Independent Safety Committee (DCISC) was called to order by Committee Chair, Dr. A. David Rossin at 8:30 A.M. at the Embassy Suites Conference Center in San Luis Obispo, California. Roll call was taken.

Present:

Committee Member William F. Conway

Committee Member Per F. Peterson

Committee Member A. David Rossin

Absent:

None

II. Introductions

The Chair introduced the Committee’s Consultants present including Dr. Sheila Sheinberg, Mr. Jim E. Booker, Mr. R. Ferman Wardell, and Legal Counsel Robert R. Wellington. The Chair welcomed PG&E’s Mr. Steve Chesnut to the meeting.

III. Public Comments and Communications

The Chair inquired whether there were any persons present who wished to address remarks to the Committee and reviewed the procedural rules for receiving comments to the Committee. There were no comments from any persons at this time.

IV. Consent Agenda

The only item on the Consent Agenda was approval of the Minutes prepared from the Transcript of the Committee June 20-21, 2006 public meeting held in Shell Beach. Direction was received concerning editorial changes to the draft of the June Minutes for accuracy and clarity. Mr. Conway inquired whether the root cause evaluation for mispositioning events, which occurred during the twelfth refueling outage for Unit-2 (2R12), had been provided to the Committee for its review. Mr. Chesnut stated he would inquire regarding the status of that evaluation for possible presentation during a future public meeting. Mr. Conway requested PG&E’s Vice President for Nuclear Services, Ms. Donna Jacobs, be asked to briefly review during her scheduled evening presentation her participation in the executive task force convened as part of a recent Nuclear Energy Institute (NEI) program on community relations. On motion by Dr. Peterson, seconded by Mr. Conway, the June 20-21, 2006, Minutes were approved as amended. The minutes of the Committee’s public meetings become part of its Annual Report on Safety of Diablo Canyon Nuclear Power Plant (DCPP) Operations (Annual Report).

V. Action Items

A. DCISC 16th Annual Report on Safety of Diablo Canyon Operations; July 1, 2005 - June 30, 2006:

Mr. Wardell reviewed with the Members and the other Consultants the review process for the two prior drafts of the Annual Report which were circulated for comments and he identified and discussed areas with significant changes incorporated from that review.

Members provided further editorial corrections to the final draft which will be incorporated by Mr. Wardell. The Report, following its approval, is then provided to PG&E for its formal response which becomes part of the Annual Report. The Annual Report is published in two bound volumes, on compact disk and on the Committee’s website at www.dcisc.org . The Chair encouraged the other members to schedule personal visits with their appointing agencies to present the 16th Annual Report and to discuss the role of the Committee and its recent activities with representatives of those agencies which appoint members to the DCISC.

On a motion by Dr. Peterson, seconded by Mr. Conway, the DCISC Members unanimously approved and adopted their 2005-2006 Annual Report with editorial corrections which were provided to Mr. Wardell for incorporation into the final Report.

B. Update on Financial Matters and Committee Activities:

Legal Counsel Wellington reviewed the latest financial statement received from the Committee’s accountant. Members and consultants reviewed planned Committee activities for the remainder of 2006 and, based upon comparison with 2005 spending, they concluded sufficient funds were available to complete scheduled activities. Mr. Wellington reminded members and consultants to submit invoices for work performed during 2006 as soon as possible before or shortly after January 2007, to ensure they are paid from 2006 Grant funds. Mr. Wellington remarked there were regulatory matters yet to be addressed with the California Public Utilities Commission (CPUC) which could result in additional expense in 2006.

C. Discussion of Issues on Open Items List:

Mr. Wardell reviewed the latest edition of the Open Items List included with the public agenda packet for this meeting. The Open Items List is used by the Committee to track and follow topics, items and activities identified during its public meetings and Fact-finding sessions with PG&E. Certain items were identified for closure or amendment and future action was scheduled concerning others including:

Scheduling review of the Institute for Nuclear Power Operations (INPO) Change Management assist visit during the scheduled October 2006 Fact-finding visit by Dr. Peterson and Mr. Wardell;

Continued monitoring of the DCPP Fire Protection System, Programs and Action Plan;

Review of progress on construction of the Independent Spent Fuel Storage Installation (ISFSI);

Closely following PG&E’s plans for replacing the DCPP steam generators.

Members discussed with Mr. Chesnut and PG&E Regulatory Supervisor Mr. Kent Oliver resolution of several items from the last public meeting of the DCISC including establishing that the Anticipated Trip Without Scram Mitigating System Actuation Circuitry System (AMSAC) met regulatory requirements and governance was in place as that System was included within the Equipment Control Guidelines rather than in the Technical Specifications (TS). Mr. Conway and Mr. Chesnut discussed post maintenance testing following a declaration of inoperability due to gagging of the main steam safety valves and observed no post maintenance activities were included in the TS to verify their operability following gagging. Mr. Conway commented upon the nature of assumptions of operability common in the industry and the need for assurance that the valves are not physically impaired following gagging. Committee members agreed to further review this issue during future Fact-finding. Dr. Sheinberg recommended, and the Members approved, changing references in the Open Items List from “Performance Improvement (Learning) Programs” and “Learning & Development Programs” to “Learning Organization and Performance Improvement Program” and “Training and Development Programs,” respectively, in order that these references remain consistent with the Annual Report.

Mr. Conway inquired concerning DCISC review of DCPP’s accredited training programs, and members and consultants discussed clarifying that the role of the DCISC does not duplicate the accreditation process, but rather provides for the Committee’s observation and review of the programs utilized by DCPP and the participation of DCPP personnel in those programs. Mr. Conway observed that the Committee and the Quality Verification organization identified instances where DCPP personnel had performed tasks for which they had not received accredited training. Mr. Chesnut confirmed Mr. Conway’s observation and commented there were no consequential impacts as a result.

A short break followed.

VI. Committee Member Reports and Discussion

A. Public Outreach, Site Visits and Other Committee Activities: Members observed that a public tour of DCPP is scheduled for 8:00 A.M. on Thursday, October 19, 2006.

Legal Counsel Wellington reviewed with members and consultants several of the comments received from the public conducted by the Committee in June 2006. He observed the comments were generally very favorable and those on the tour expressed appreciation for the opportunity. Members determined to conduct a plant tour during their January 2007 public meeting. Mr. Wellington commented that plant tours, the Committee’s website and the cablecast and online broadcasts of its public meetings represent the most significant areas of its public outreach efforts. Dr. Peterson commented there were a number of Cal Poly engineering students signed up for the tour and he inquired if PG&E was considering offering a tour with a higher level of technical information to engineering students. Mr. Oliver and Mr. Chesnut replied PG&E and DCPP Vice President Jacobs recognize the value of conducting plant tours for engineering student groups and the issue would receive consideration.

B. Documents Provided to the Committee:

Mr. Wellington directed the Committee’s attention to the list of documents received since its last public meeting in June 2006. A copy of the list was included with the public Agenda packet for this meeting.

Members and consultants discussed future scheduling of Fact-findings and public meetings. Public meetings were confirmed for January 31-February 1, June 20-21 (now June 13-14) and October 24-25, 2007.

VIII. Staff-consultant Reports & Receive, Approve and Authorize Transmittal of Fact-finding Reports to PG&E

Consultant Wardell discussed and reported to the Committee on the September 6-7, 2006, Fact-finding visit to DCPP with Mr. Conway and Dr. Sheinberg.

The DCISC Fact-finding team reviewed the12 kV System with its system engineer. The 12 kV System is a non-safety related system and provides power supply to the reactor coolant pumps and circulating water pumps. The system status is currently rated in ‘white’ due to issues with transformer bushings and radiator oil leaks. The system is now scheduled to reach ‘green’ status in 2011.

Transmission grid reliability was reviewed during the Fact-finding including DCPP’s response to an NRC Generic Letter on this topic. The DCISC representatives reviewed the protocols in place between the DCPP operators and the transmission system operators and concluded the system meets NRC requirements

The DCISC team reviewed reactivity management with DCPP’s Operations Manager. Reactivity management assures power distribution in the reactor core remains within specified procedural limits at all times. The minutes of the Reactivity Management Leadership Team’s meetings were reviewed. Mr. Wardell observed the Plant Process Computer, which is scheduled to be replaced, is extensively used by the Reactivity Management organization. He reported the program appeared to be in good shape, with its performance indicators close to their goals. In response to a question from Dr. Rossin concerning the adequacy of those performance indicators, Mr. Wardell confirmed it was necessary to look deeper than the program’s numbers and he identified the number of events as the most significant of the system’s performance indicators. Mr. Wardell stated reactivity management also monitors precursor events and Mr. Conway confirmed it was his impression that the program is well defined and administered.

The Boric Acid Corrosion Control Program was reviewed. The Program identifies and tracks boric acid leakage and brings those events within DCPP’s Corrective Action Program. The program is currently in ‘green’ status. Mr. Wardell reported the plant has experienced problems with valve packing in its Rockwell-Edwards valves. A Self-Assessment was conducted in 2006. In response to a question from Dr. Rossin, Mr. Chesnut confirmed DCPP continues to expect to find some indications of boric acid leakage and will continue to inspect and improve its maintenance processes in response.

The DCISC representatives reviewed the status of 4kV system cable degradation and replacement. The 4kV system is currently in ‘yellow’ status due to cable degradation caused by defects stemming from its manufacture during the early 1970’s. Mr. Wardell commented DCPP has taken a risk-based approach to this problem and half the cabling has been replaced with the remainder of the cabling scheduled to be replaced by 1R15. In response to a question from Dr. Peterson, Mr. Chesnut confirmed the physical degradation was caused by a contaminant in the insulation and the cable, some of which has been underground for 30 years, has experienced some shorting due to the presence of water in the cable conduit. He confirmed that ground fault interrupter alarms are in use. Mr. Conway commented this is a generic problem with buried cable and is not exclusive to DCPP and Mr. Chesnut remarked the Electric Power Research Institute (EPRI) now has a working group studying this issue.

DCISC representatives attended a meeting of the Plant Health Committee, chaired by the DCPP’s Maintenance Director, and Mr. Conway observed the meeting appeared to be largely run by the chair and questioned whether this was an exception to normal Plant Health Committee performance. Mr. Chesnut replied that Plant Health Committee procedures include preparations prior to a meeting and the role of the chair is to move through the agenda concerning those issues first raised prior to a meeting. Mr. Conway remarked the process should be one whereby ideas are exchanged. The Committee agreed to add a new item to its Open Items List concerning future monitoring of the role and function of the Plant Health Committee. Mr. Chesnut observed the function of the Plant Health Committee is to act as a decision-making body concerning system engineers’ advocacy for funding for their respective systems and when the Plant Health Committee concurs with the system engineer, to then raise those issues with DCPP’s Plant Review Committee for DCPP Vice Presidents’ review and determination of timing and funding requirements. Mr. Conway questioned whether system needs were ranked by priority and he observed vulnerabilities can change. Mr. Chesnut replied that a Plant Health Subcommittee routinely reviews ranking and scoring of system needs. Dr. Sheinberg observed that the process used by the Plant Health Committee to develop its recommendations was not evident and she commented she saw outcomes but not a process from her observation of the Plant Health Committee meeting. Mr. Conway stated he was looking for an interchange of opinions at the meeting and that prioritization of issues was not evident.

The DCISC representatives reviewed the Safety Culture and the Safety Conscious Work Environment (SCWE) at DCPP and reported the plant has both a new program directive and procedure to communicate management expectations concerning these areas. Mr. Rick Burnside, who heads the Employee Concerns Program (ECP) at DCPP and serves as the safety culture subject matter expert and program facilitator, will be conducting quarterly surveys of 10-20% of the DCPP workforce concerning their perception of Safety Culture and SCWE. The results of those surveys may then be entered into the Corrective Action Program. Mr. Wardell suggested the Committee follow-up concerning those efforts. Mr. Burnside commented the NRC, in its June 2006 biannual inspection on Problem Identification and Resolution, assessed the SCWE at DCPP as positive, based on interviews conducted with Plant personnel.

The DCISC Fact-finding team also reviewed the Equipment Qualification Program, including the impact on that program of the Steam Generator Replacement Project, and the Corrective Action Program. Better involvement by the line organizations and better quality of resolution of corrective action items were two of the areas identified for future tracking by the Corrective Action Program. In response to a question from Mr. Conway, Mr. Chesnut confirmed modifications have been made to the containment fan cooler units (CFCU) to prevent reverse rotation of the fan and he stated problems have been resolved, however, DCPP will continue to study the use of anti reverse couplings on its CFCUs. Mr. Conway and Mr. Wardell reviewed the results of the Quality Verification (QV) audit of the Software Quality Assurance Program, which found that program to be effective with no quality issues identified from the audit. The Vendor Manual Program, to assure vendor equipment manuals are current, was improved to provide clear lines of responsibility and review was undertaken to ensure the latest manuals are available for the installed equipment. To conclude the Fact-finding visit, Mr. Conway met with PG&E Vice President Jacobs and with PG&E’s Senior Vice President - Generation and Chief Nuclear Officer Mr. John S. Keenan.

On Mr. Conway’s motion, seconded by Dr. Peterson, the September 6-7, 2006, Fact-finding Report was unanimously received and approved and its transmittal to PG&E authorized. Committee Fact-finding reports become part of the Committee’s Annual Report.

Committee Consultant Mr. Booker reported on the August 2-3, 2006, Fact-finding visit to DCPP with Dr. Rossin.

The Committee’s representatives reviewed the First and Second Quarter 2006 Quality Performance Assessment Report (QPAR). Mr. Booker commented on his observation the QV organization repeatedly identifies many of the same problems which, if the line organizations were performing correct self-assessments, should not be the case. In response to a question from Mr. Conway concerning how the line organizations view the QV organization, Mr. Chesnut responded the line organizations have generally judged QV assessments as insightful, although there have been cases of their healthy disagreement regarding QV’s findings.

Mr. Booker reported the QV organization has completed a verification analysis and identified issues for DCPP in response to the NRC’s Generic Letter on containment sump debris blockage.

The DCISC Fact-finding team reviewed improvements to the Generic Outage Safety Plan which will be implemented in the Outage Safety Plan for 1R14. DCPP’s “As Low As Reasonably Achievable” (ALARA) Program was also reviewed including the significant radiation dose reduction achieved during 2R13, in part by limiting the number of entries into containment through increased employee awareness. Dr. Rossin commented collective dose statistics are meaningless as an indicator of safety hazard or health effect and, therefore, it is the ALARA Program, rather than its statistics, which the Committee should continue to review.

The Committee team reviewed the status of the Self Assessment Program and the scheduling of future self-assessments. Mr. Booker commented that INPO has added DCPP to the list of plants to be ‘benchmarked’ as examples of successful self-assessment programs. Engineering workload management and the status of project engineering were also discussed and Mr. Booker reviewed DCPP’s recent efforts to provide long-term support to better manage projects and prioritize Action Requests (ARs).

The Fact-finding team also reviewed the Employee Concerns Program (ECP) and the Differing Professional Opinion Program. Through August 2006, there have been three allegations received from the NRC and one concern was raised internally. All were investigated and none were substantiated. There were a total of 28 low-level contacts reviewed by the ECP. Mr. Burnside, who reviewed the ECP activities with the Committee, reported PG&E believes employees are raising their concerns with their supervisors and management, and many concerns are resolved at that level rather than being raised within the ECP. Mr. Chesnut confirmed surveys of DCPP employees have not shown there is a reluctance among them to raise concerns with the ECP. The Differing Professional Opinion Program has not been used since 2004, and PG&E again attributes resolution of issues at the supervisor level for the Program’s lack of use.

System Health Reports were also reviewed and discussed and Mr. Booker reviewed the colored coded system used to indicate system health:: Red - Unsatisfactory, major performance and health issues, actions in response still under development and not yet being implemented;; Yellow - Unsatisfactory, major performance and health issues, actions in response identified and scheduled for implementation;; White - Satisfactory, actions to address performance and health issues corrected, no trend yet identified;; Green - Satisfactory system health and performance.

In response to a question from Dr. Peterson, Mr. Booker and Mr. Chesnut confirmed the status of some DCPP system indicators has changed from white to yellow, based upon the systems having been in white status for a considerable period of time. Mr. Booker reviewed the six DCPP systems currently in yellow status and reported both Unit 1 (U-1) and Unit 2 (U-2) 12kV electrical systems are currently in yellow status and are not expected to achieve white status until 2012. The U-1 and U-2 Plant Process Computer System is currently in red status due to its obsolescence and replacement equipment has been ordered.

The DCISC representatives reviewed the work performed on the Intake Structure during 1R13 and 2R13 to address ocean environment weathering issues resulting in corrosion, rusting rebar and delamination of concrete. Mr. Booker and Dr. Rossin reviewed the efforts of the system engineer to bring management attention to the Intake Structure’s condition.

The DCISC team reviewed DCPP plans to install the Nuclear Excellence Information System (NEXIS) and reported implementation of NEXIS has been delayed until the end of June 2007. To conclude the Fact-finding, Dr. Rossin met with Vice President Jacobs to discuss the team’s visit and impressions.

On motion of Dr. Rossin, seconded by Dr. Peterson, the September 6-7, 2006, Fact-finding Report was received, approved by the Committee and its transmittal to PG&E authorized.

Legal Counsel Wellington provided a regulatory update to the Committee and reviewed the history of the Committee’s pending filing with the CPUC for a Restated Charter for the DCISC. Mr. Wellington reported he has received information concerning PG&E’s appeal to the U.S. Supreme Court of the opinion of the federal Ninth Circuit Court of Appeals regarding PG&E’s consideration in the NRC environmental review of the effects of terrorism in connection with the construction of the ISFSI. Mr. Wellington also briefly reviewed the opposition to the settlement proposed in the PG&E 2007 General Rate Case by the Alliance for Nuclear Responsibility, The Utility Reform Network, Aglet and the Sierra Club.

IX. Correspondence

Copies of correspondence sent and received at the office of the Committee’s Legal Counsel were included with the public Agenda Packet for this meeting.

X. Adjourn Morning Meeting

The morning meeting of the DCISC was adjourned by the Chair at 12:10 P.M.

XI. Reconvene for Afternoon Meeting

The afternoon public meeting of the Diablo Canyon Independent Safety Committee was called to order by the Chair at 1:30 P.M.

XII. Committee Member Comments

There were no comments by members at this time.

XIII. Public Comments and Communications

There were no comments from members of the public.

XIV. Information Items Before the Committee

Maintenance Department Overview

Mr. Jack Purkis, DCPP Maintenance Services Director, provided an overview of his presentation on the Maintenance Department and discussed its organization and staffing. He reported the Maintenance organization has reorganized from its previous configuration of decentralized teams distributed throughout the site, which presented problems with staffing and having enough qualified individuals to perform the work, to its current composition as a more traditional, discipline-oriented, organization.

The Maintenance organization is staffed by 220 technicians as follows:: Instruments and Controls with 73 technicians; Electrical Maintenance with 35 technicians; Mechanical Maintenance with 66 technicians; Team Maintenance with 46 technicians
The Maintenance Support organization is staffed by 122 technicians as follows:: Maintenance Planning with 24 technicians; Construction Planning with 34 technicians; Construction Oversight with 7 technicians; Paint and Insulation with 27 technicians; Facilities with 30 technicians

The entire Maintenance Services Organization comprises some 342 persons. Mr. Purkis, in response to a question from Dr. Peterson, stated Maintenance organization staffing was between 5 and 10 persons less than that at other two unit nuclear plants, while the DCPP Maintenance Support organization is larger than typically found at other two unit plants. He attributed the differences in staffing levels as due to the amount of construction work at DCPP and the related construction planning and oversight activities. He confirmed, in response to a question from Dr. Rossin, construction planning and oversight are often located within the Engineering organization or other project-specific, dedicated, units at other nuclear plants. Increased Paint and Insulation staff are required at DCPP due to the ocean environment in which the plant is located. In response to a question from Mr. Wardell, Mr. Purkis stated scaffold-builders are part of the Painting and Insulation department of Maintenance Support.

Mr. Purkis reviewed with the Committee human performance trends in the Maintenance Department, which saw 8 department significant human performance errors during the month of February 2006, of these 5 involved contractor personnel. He reported issues related to those errors have now been addressed by increasing the number of paired observations by supervisors and managers in the field and reinforcement of the importance of coaching. He reported the human performance error trend has been relatively stable through August 2006. In response to a request from Dr. Peterson, Mr. Purkis reviewed types of errors which could be considered significant, such as intending to perform work on one component while actually performing work on another, and non significant, such as forgetting to sign a step in a procedure, although the step was actually performed.

In response to a request from Mr. Conway, Mr. Purkis explained that a department-significant error can result in a ‘clock reset’ of the number of days since the last error, which is a metaphor to designate the fact that departmental specific human performance guidelines and practices were not met. Such clock resets increase the level of plant personnel awareness of human performance expectations and bring a level of follow-up investigative actions and communication Station errors at DCPP are classified as noteworthy or non-noteworthy which, Mr. Chestnut reported on a distinction of whether the consequence of the error causes further work to be performed. A non-noteworthy error may be occasioned by simply not meeting expectations, such as failing to sign off on a performed procedure.

Mr. Purkis reviewed the performance trend since October 2005 for Maintenance rework and repeat activities, which he described as well below the DCPP goal of 0.75%. He reported there is an independent, non-supervisor rework coordinator from within the Maintenance organization assigned to review all AR work for rework aspects. He confirmed, in response to an observation from Dr. Rossin, that February 2006 included a number of rework issues (0.87%) due to the amount of pre-outage work.

Mr. Purkis reviewed the preventive maintenance performance statistics for 2006, which involve calculation of a maintenance interval schedule ‘grace period’ and measure the percentage of tasks that fall within that grace period. He described DCPP’s statistics as representing excellent preventive maintenance performance, with no tasks falling past the grace period. In response to an observation by Mr. Conway, Mr. Purkis confirmed that DCPP is now conducting a preventive maintenance optimization frequency study, scheduled for completion by June 2007.

Mr. Purkis reviewed the AR backlog trend for each DCPP unit and reported there are currently 2 corrective action work requests for U-1 and 5 for U-2, none of which is more than three months old. He reported the elective maintenance backlog is also declining, in terms of both numbers and age of items, with 426 current work requests per unit compared to the goal set for 2006 of 350.

In response to a question from Dr. Rossin, Mr. Purkis commented that taking corrective actions on the issues initiating ARs, as identified by trending, is an effective technique in reducing the number of ARs and he gave as an example the problems experienced with air operated valves, which were successfully addressed by a modification and has resulted in fewer problems.

Mr. Purkis reviewed and discussed with the Members and Consultants the status of current issues in the Maintenance organization including:: 7 Reportable Injuries and No Disabling Injuries to date in 2006; Increased Efficiency; Improvements to Work Package Quality; Procedure and Work Order Adherence

In response to a question from Mr. Conway, Mr. Purkis stated human performance and error precursor tools are used to reduce procedural error and are accepted by the workforce at DCPP as enabling workers to achieve better procedural adherence. Maintenance managers have had their meeting commitments reduced and they are now spending increased time in the plant mentoring and coaching. Mr. Chesnut reported DCPP has reviewed the purposes and goals of its managerial meetings and adjusted schedules accordingly. In response to a question from Dr. Rossin, Mr. Purkis replied the Plant Health Subcommittee was established to review and make recommendations concerning proposed modifications before they are reviewed at the Plant Health Committee level, thereby allowing the full Plant Health Committee to focus more of its attention on relative priorities rather than technicalities. In response to a question from Mr. Conway, Mr. Purkis replied foreign material exclusions issues received a root cause evaluation and corrective actions were identified and are now in the process of being implemented. In response to a request from Consultant Wardell, Mr. Purkis commented Maintenance and Engineering organizations at DCPP have reviewed ‘troubleshooting’ efforts and procedures have been rewritten to provide better documentation and separate the troubleshooting function from common cause analysis

Mid-Cycle Review and Subsequent Ongoing Efforts

Mr. Chesnut stated the primary purpose of doing a mid-cycle review in July 2006, halfway through the most recent INPO evaluation cycle, was to identify gaps in excellence, identify industry-leading performance, and assess progress in areas previously identified for improvement by the INPO evaluation conducted in the Spring of 2006. The review team assembled for the July 2006 mid-cycle review consisted of 8 industry peers selected by PG&E from other nuclear plants, an INPO senior representative and 12 PG&E employees at the manager or director level including Mr. Jim Becker, PG&E Vice President and DCPP Station Director.

The mid-cycle review process replicates an actual INPO evaluation including a one week sequester for the team to conduct data review and identify focus areas and a two-week evaluation, with weekly debriefings, including cross-functional assessment of various departments through use of an INPO-style organizational effectiveness survey. INPO-identified areas include areas for improvement (AFIs) and performance deficiencies (PDs).

Mr. Chesnut reported the mid-cycle review evaluation team concluded that DCPP had made significant improvement in plant performance since the last INPO evaluation including power history, INPO Composite Index, recent refueling outage performance and closure of previously identified AFIs for long-standing equipment issues, corrective action and self assessment program shortfalls and alignment around key focus areas.

In response to a query from Mr. Conway, Mr. Chesnut confirmed that the mid-cycle assessment of the status of previously identified AFIs may not necessarily match INPO’s subsequent evaluation of those areas on the next INPO evaluation and Mr. Chesnut stated DCPP still has action plans in place and will continue to move forward on closing its AFIs for such items as long-standing equipment and corrective action issues. Mr. Chesnut confirmed Mr. Conway’s observation that a perception of closure might be brought on by development of a programmatic situation, as opposed to the issue actually being resolved. Mr. Chesnut stated DCPP was committed to fix not just the issue identified but the process that governs maintaining the item in acceptable status for the long term and he stated INPO evaluates AFIs for closure on the basis of whether a plant has addressed the issues identified by the INPO team and then whether a process or program is in place that will sustain the desired results.

Mr. Chesnut reported the most significant area for improvement identified by the INPO team concerned organizational effectiveness in achieving industry leading performance in all targeted areas not having been consistent at DCPP. He reported on the corrective actions put in place to engage the DCPP workforce including an Industrial Safety High Impact Team and including workers in inspection and self assessment debriefs. Outside consultants have been engaged to assist in these efforts and plant leadership has committed to making time available to communicate its expectations to the workforce on a day-to-day basis. Dr. Sheinberg queried, based on a past DCPP root cause analysis which identified the cause of an issue at DCPP as due 35% to leadership, 50% to systemic and organizational issues and 15% to workforce issues, why the workforce was targeted for corrective actions? Mr. Chesnut replied ineffective communication by leadership of its case for change and a common cause analysis, which identified insufficient engagement by the workforce, were principal reasons for the focus on developing a workforce-engaged, workforce-led environment for DCPP. The Committee agreed to follow up on this issue during future Fact-finding.

Mr. Chesnut stated the most significant issue identified by the mid-cycle assessment involved gaps to industry leading maintenance work instructions and he stated that improving work planner guidance documents and procedures to the point where less experienced individuals are comfortable using them is an important part of the corrective actions being taken. A formal Work Planner Improvement Program is being implemented and work package feedback documents are being developed. There is also increased emphasis on pre job walk downs by Maintenance supervisory personnel.

Other areas for improvement identified by the mid-cycle assessment and reviewed by Mr. Chesnut include aligning chemistry goals with industry best practices, improving process and frequency for verifying worker qualifications, aligning with industry efforts to improve vendor performance and project oversight and incorporating key improvement plans and metrics into the DCPP business plan.

In response to a question from Consultant Booker concerning corrective actions identified in mid-cycle evaluations performed in 2003 and 2004, which identified issues similar to those identified in the most recent mid-cycle self assessment, Mr. Chesnut replied that he was not aware of whether a common cause evaluation was being performed on why previous corrective actions may not have been appropriate. Mr. Booker observed, and Mr. Chesnut agreed, if the line organization were performing as it should, the types of issues identified by the mid-cycle self assessment would not be found. Dr. Rossin commented on the importance of the identification of trends in any cause analysis. In response to a question from Mr. Conway concerning the DCPP Business Plan, Mr. Chesnut reported the Business Plan is reviewed on a monthly basis and revised quarterly and communication to DCPP employees concerning the Business Plan is a large part of DCPP communication plans through weekly newsletters, supervisor workshops and DCPP continues to benchmark with other plants concerning improving communication with the workforce. Mr. Conway commented that the results of a recent survey found 50% of workers did not know where to find a copy of the DCPP Business Plan.

A short break followed.

Review of the Fourteenth Refueling Outages for Both Units (1R14 & 2R14).

DCPP Outage Director Mr. Dennis Petersen reviewed the goals for 1R14, now scheduled to commence April 30, 2007:: No injuries (disabling and recordable); No Human Performance Events; less than 25 day breaker-to-breaker schedule duration; less than 5 day power ascension; 100% power greater than or equal to 30 days; Outage dose to be established by November 2006
1R14 major scope items include:: Containment fibrous material elimination and recirculation sump modification; Normal charging pump replacement; Reactor coolant pump 10-year motor inspection and rotor swap; Reactor system make-up controls upgrade; 4 kV Bus F load cables and cubicle hinge wiring replacement; Service cooling water system chemical cleaning; Reactor vessel head inspection; Main generator robotic inspection (rotor in)

The 1R14 safety plan includes no Reactor Coolant System (RCS) “hot” mid-loop operations prior to reactor core unload. Mid-loop operations will take place after core reload to perform RCS vacuum refill and to remove steam generator nozzle dams with all electrical power to be available during mid-loop operations. Mr. Petersen reported that infrequently performed tasks or evolutions during 1R14 include “cold” mid-loop operations and digital feedwater controls replacement testing.

Mr. Petersen reviewed some of what he described as the key challenges during 1R14, including improving industrial safety and human performance, late scope identification, and the design and planning for the containment recirculation sump modifications to eliminate sources of fibrous material to the recirculation sump. First time projects include normal charging pump replacement, reactor makeup controls and service cooling water chemical cleaning. Achieving 1R14 in less than 25 days will also be a key challenge.

Mr. Petersen commented that, due to the Steam Generator Replacement Project, the scope for the R14 cycle outages was established so items would not conflict with the steam generator related work inside containment. He reported that the work on the containment sump and the 10-year tests, therefore, represent major challenges.

Mr. Petersen reviewed the goals set for 2R14, now scheduled to commence February 4, 2008, including:: No injuries (disabling and recordable); No Human Performance Events; less than 70 day breaker-to-breaker schedule duration; less than 5 day power ascension; 100% power greater than 30 days; Outage dose to be established by April 2007

Mr. Chesnut, Mr. Petersen and Drs. Rossin and Peterson discussed the relationship of setting radiation dose expectations according to the scope of work during an outage. Mr. Petersen stated DCPP expects to challenge its outage team to reduce dose estimates and exposure and to develop innovative solutions, rather than accepting higher dose rates based upon the outage scope.

Mr. Petersen reviewed the major scope items during 2R14 including:: Steam generator replacement; Containment fibrous material elimination and recirculation sump modification; 10-year Integrated Containment Leak Rate Test; Normal charging pump replacement; RCS makeup controls upgrade; 4 kV Bus F load cables and cubicle hinge replacement; Service Cooling Water System chemical cleaning; Reactor vessel head inspection; Main generator inspection with rotor swap

The 2R14 safety plan includes no RCS “hot” mid-loop operations prior to reactor core unload. Mid-loop operations will be performed after core reload to perform RCS vacuum refill with all electrical power to be available during mid-loop. Infrequently performed tasks or evolutions during 2R14 include “cold” mid-loop operations.

Mr. Petersen, in concluding his presentation, reviewed the key challenges for 2R14 which include maintaining excellent industrial safety and human performance, integrating other containment work scope with the Steam Generator Replacement Project including the integrated leak rate test, sump modification and fibrous material elimination, the reactor vessel head inspection, and site access issues including parking and traffic controls. In response to a question from Dr. Peterson, Mr. Petersen estimated DCPP’s on-site workforce will be augmented by 1,000 to 1,200 contractor personnel during 2R14.

A short break followed.

Mr. Chesnut introduced DCPP Senior Civil Engineer Rob O’Sullivan to make the next informational presentation.

Inspection of the Intake Structure during the Thirteenth Refueling Outages for Both Units (1R13 & 2R13) and Repair Plans.

Mr. O’Sullivan reported part of his group’s responsibility is to conduct structural assessments and condition monitoring of the various Power Block buildings and facilities at DCPP. He stated the Intake Structure at DCPP is a non safety related, graded quality “S” (seismic), reinforced concrete shear wall building which houses and supports components for the Circulating Water and the safety-related Auxiliary Saltwater Systems (ASW). The Intake Structure provides direct flow of cooling water to DCPP and was designed and constructed in the early 1970’s. Due to its location, the Intake Structure is exposed to extreme coastal environmental conditions. In response to a question from Consultant Wardell, Mr. O’Sullivan replied that in 1971, the classification of the Intake Structure was recognized as housing safety-related components and its classification was upgraded to Class 2 graded “S” (seismic), due primarily to seismic-induced tsunami considerations and any work performed on the Intake Structure must meet Class I safety-related requirements.

Mr. O’Sullivan provided a computerized 3-D walk through of the Intake Structure to the Committee and described its location, configuration and dimensions. He then reviewed with the Committee the mechanism of concrete aging and the potential corrosion of the embedded steel reinforcing bars (rebar) caused by the interaction of oxygen, chlorides in sea salts and moisture on the permeable concrete. Corrosion products (rust) eventually buildup and surface cracks and staining occurs, eventually causing expansion of the rust and concrete spalling, exposing the rebar.

DCPP implemented its Intake Structure Inspection Program in the early 1990’s, as the first signs of rebar corrosion were becoming evident, after approximately 20 years which, Mr. O’Sullivan stated, is typical for concrete in a marine environment. In response to a question from Dr. Peterson, Mr. O’Sullivan stated epoxy coatings and cathodic protection can be used but DCPP’s Intake Structure designers relied on the distance of the embedded rebar from the surface of the concrete to provide protection. He reported the purpose of the Concrete Surveillance Program for the saltwater systems now used at DCPP is to monitor and preserve their structural integrity and to trend and assess the condition of concrete structures while providing a date to prioritize and perform repair. All inspectors are Level III concrete inspectors or licensed civil engineers and the Intake Structure is inspected once per refueling cycle per unit. The acceptance criteria are based on the American Concrete Institute’s 201.1R document. The Intake Structure is inspected visually to locate cracks, by hammer soundings to identify areas of delamination, half cell potential readings to measure the electrical activity of the corrosion process and chloride content testing and Mr. O’Sullivan described briefly each of these techniques. In response to a question from Dr. Peterson, Mr. O’Sullivan stated the inspections are concerned only with the condition of the rebar, there is no evidence on which to base concern about the condition of the concrete below the rebar.

During 1R13 and 2R13, the scope of the inspections was limited to de-watered or operationally sensitive areas of the Intake Structure which are normally inaccessible during plant operations. Eighty to one hundred per cent of the previously identified areas showing signs of aging were inspected and samples were obtained from areas currently showing no signs of aging from previously repaired areas. Areas inspected included the Intake forebays for U-1 & U-2, the circulating water tunnels and pump decks for both units, and the ASW vacuum breaker vault for U-2. Mr. O’Sullivan reviewed results of each of these inspections with the Committee:

Intake Forebays - generally in good condition due to original cathodic protection system, however, forebays will continue to be monitored for delamination, which was observed, and cracking, as corrosion activity indicated by half cell potential readings and chloride content identified. No current adverse degradation to the structural system, however, concrete repair is planned for the forebays to reverse the aging trends.

Circulating Water Tunnels - no significant increase in concrete aging identified, attributed to a sacrificial cathodic protection program installed in 1997.

Pump Deck - general condition of structural elements is good, with the exception of ASW 1-1 and 1-2 pump vaults floor slabs which indicate delamination and aging. Corrosion activity found by half-cell potential testing and chloride levels found at various levels. No adverse impact to floor slabs but if allowed to advance, future impact on equipment anchors may occur and repairs are planned to reverse this trend.

U-2 ASW Vacuum Breaker Vault (2R13) - a cast-in-place reinforced concrete vault housing safety related ASW piping vacuum breakers. Degradation was identified and repaired in 2R8. No significant degradation of growth identified during 2R13, 2R8 repairs appear sound and continue to perform as predicted, no further repair required at this time.

Mr. O’Sullivan reviewed the scope of the repair program which include prioritizing repairs by inspection results and structural evaluations and assessments to ensure the repair program’s goal of maintaining the design margin of the Intake Structure are met. Repairs are also to be performed to reduce the potential for equipment damage to water pumps and traveling screens and to reduce or eliminate any adverse trends in concrete degradation. Repairs are scheduled to ASW pump vaults 1-1 and 1-2 during 1R14; to Intake forebays 1-2 and 1-5 during 2R14; to Intake forebays 2-1 thru 2-6 during 1R15; and to Intake forebays 1-3 and 1-6 during 2R15. General repair plans, based on industry standards and benchmarking, include removal of delaminated concrete, surface preparation, installation of sacrificial anode pucks and pour back and concrete sealing. DCPP is also planning to preserve the concrete that is not currently showing signs of aging and to concentrate on areas with a high corrosion potential with the goal of reducing further repair costs. Preservation options and techniques include arc spraying zinc sacrificial anodes with surface confirming zinc spray and embedding sacrificial anode plugs.

In concluding this presentation, Mr. O’Sullivan observed through the use of state-of-the- art inspections, condition monitoring, repair and preservation techniques, the Intake Structure should continue to operate within its design margins.

XV. Adjourn Afternoon Meeting

The afternoon session was adjourned by the Chair at 5:10 P.M.

XVI. Reconvene for Evening Meeting

Dr. Rossin convened the evening meeting or the DCISC at 5:30 P.M.

XVII. Committee Member Comments

There were no comments by Committee members at this time.

XVIII. Public Comments and Communications

The Chair reviewed the protocol for members of the public to make comments or to provide material for consideration by the Committee. There were no comments by any member of the public at this time.

XIX. Information Items Before the Committee (Cont.)

PG&E Vice President for Nuclear Services, Ms. Donna Jacobs, joined Mr. Chesnut at the PG&E table for this session.

Review of NRC Notices of Violations, Licensee Event Reports and NRC Performance Indicators.

Mr. Larry Parker, Regulatory Services Supervisor, reviewed the one Reportable Event which generated a Licensee Event Report (LER) since the Committee’s last meeting in June 2006. On August 15, 2006, PG&E reported a diver cleaning bar racks discovered approximately 90 dead Cormorant birds on the bar racks of the DCPP cooling water intakes. Preliminary evidence indicated the birds died of natural causes and collected on the bar racks due to the intake cooling water currents. Since the deaths were not believed related to DCPP operation, no corrective actions were identified. The initial results of the testing of the birds’ remains ruled out algal bloom as the cause of death. Final tests are expected by the end of October 2006. Subsequent inspections confirmed the deaths are not an ongoing problem. Dr. Rossin inquired whether other dead birds had been discovered in other coastal locations and Mr. Parker replied that was not the case. Consultant Wardell queried why this was a reportable event and Mr. Parker replied that as the licensee, PG&E could not initially rule out that the deaths were not caused by plant operations and unusual bird or other animal impacts are part of PG&E’s license considerations. In response to a question from Mr. Conway concerning whether, if the deaths are ultimately confirmed as unrelated to DCPP, PG&E might request the NRC to rescind the LER, Vice President Jacobs replied this was something PG&E would consider.

Mr. Parker reported there have been no Notices of Violations (NOV) received by DCPP since the Committee’s last public meeting

DCPP has received five Non-cited Violations (NCV) from the NRC since June 2006, all of which were green status indicating very low safety significance and Mr. Parker reviewed those NCVs and aspects identified for each:: A self-revealing NCV was issued for violation of the Corrective Action Program for failure to promptly identify an unexpected level drop in accumulator 1-3 in 1R13. A similar event was identified during a previous outage and a problem identification and resolution cross cutting aspect was identified for this NCV.; An NRC-Identified NCV was issued for violation of procedure for an inadequate operations procedure that did not reflect previous experience that redundant level indication instruments would diverge during RCS draindown and depressurization. DCPP failed to incorporate lessons learned and a human performance cross cutting aspect was identified for this NCV.; NRC-identified NCV was issued for violation of the Corrective Action Program for failure to prevent recurrence of Auxiliary Feedwater (AFW) level control valve actuator failures. DCPP failed to address commonalities in a timely manner and a problem identification and resolution cross cutting aspect was identified for this NCV.; NRC-identified NCV was issued for violation of the 10 CFR 20.1501(a) for failure to perform a radiological survey to establish the radiation levels associated with a transient plant evolution during 2R13. During forced oxygenation to clean up the RCS, a ‘crud burst’ resulted in temporary elevated radiation levels which were not correctly posted. A human performance cross cutting aspect was identified for this NCV.; NRC-identified NCV was issued for violation of procedure for failure to follow established code requirements to document and confirm that welding preheat temperatures were met prior to welding taking place. No cross cutting aspect identified. Mr. Conway asked whether this was something DCPP Maintenance organization controls and Mr. Parker replied the procedures did not require documentation. Mr. Conway queried whether the failure to follow procedure might be due to the skill and experience of the craft workers and their familiarity with having performed the same tasks many times previously. Mr. Chesnut commented that maintenance procedures have been reviewed to assure their adequacy for use by individuals with lesser levels of experience and skills.

Mr. Parker stated no discernable trends for NCVs have been identified and PG&E continues to experience low levels of reportable events with the number of DCPP violations to date slightly below the average for NRC Region IV plants. Mr. Conway and Dr. Rossin discussed with Mr. Parker what is required to establish a conclusion concerning a trend. Mr. Parker observed there is no quantitative trigger, but DCPP monitors violations in various areas. Mr. Chesnut commented NCVs are entered into the Corrective Action Program and evaluated for trends within that program. Vice President Jacobs remarked that the determination of trends is not a function of the Regulatory Services organization and she suggested following up on the Committee’s inquiry during future Fact-finding. Mr. Parker commented the NRC has revised its Reactor Oversight Process to more closely monitor the Safety Culture during inspections by assigning crosscutting aspects to NCVs. The NRC has conducted a workshop at DCPP concerning its revised Reactor Oversight Process. Dr. Rossin requested, and Mr. Parker agreed to provide, a copy of the NRC’s notice concerning the change in the Reactor Oversight Process. Over the past four quarters, 3 NCVs had procedural compliance as the human performance crosscutting aspect. Mr. Conway commented the NCV in the June-September period for failure to follow procedure regarding documentation of welding preheat temperature represented a fourth procedural compliance NCV.

Mr. Parker reported the Problem Identification and Resolution (PI&R) inspection conducted in August 2006, included these observations:: General conclusions that:; Corrective Action Program processes were effective; Problem Identification threshold was generally low; Correction actions were adequate to address the problems; Relatively high number of findings and violations during a 2-year period; Ineffective corrective action led to a number of repeat problems; which could have been prevented; A Safety Conscious Work Environment (SCWE) exists at DCPP; Overall - performance has improved in all areas of the; Corrective Action Program since the last PI&R inspection.

Dr. Rossin observed that a conclusion which cited “a number of repeat problems” is largely without meaning. Vice President Jacobs observed no NCVs were identified as tied to apparent cause evaluations, which is an area identified for improvement at DCPP.

Mr. Parker reviewed the 12-month rolling totals for NRC-identified and self-revealing NOVs, NCVs and findings and reported the numbers were below the average for NRC Region IV nuclear plants. NRC Performance Indicators for the first quarter of 2006 are all in green status and he briefly reviewed a graphic representation of the unit-specific and unit-common NRC Performance Indicators. Mr. Parker reported the NRC has implemented a major change in its Performance Index by replacing the indicator formerly known as Safety System Unavailability with Mitigating System Performance Index.

Mr. Chesnut introduced Site Services Director Mr. Mike Meko to make the next informational presentation

Update on Security Improvements.

Mr. Meko reported that since the last public meeting of the DCISC in June 2006, DCPP participated in the Department of Homeland Security sponsored Risk Analysis Management of Critical Asset Protection (RAMCAP), a presidential mandate to assess the nation’s critical infrastructure. Nuclear facilities were selected as the first such facilities for review by RAMCAP and DCPP was included in the first phase of nuclear plants to be assessed. The RAMCAP assessment included law enforcement and emergency management round table discussions and a detailed evaluation of DCPP and its defensive posture. The NRC observed the assessment. The Department of Homeland Security and others involved considered the assessment to have been very successful, however, a report will not be issued until all nuclear plants have been reviewed.

In September 2006, DCPP conducted a force-on-force drill which Mr. Meko stated produced excellent results, with all its objectives being met. He reported DCPP has graduated 13 nuclear security officers and 2 alarm station operators from its Security Academy, and the Academy has been recognized by INPO for its systematic approach to training. In response to a question from Mr. Wardell, Mr. Meko stated that the DCPP Security Academy has placed emphasis on personal safety, detection and intervention, with more intense and direct training which has produced good results. DCPP is currently expecting notification from the NRC concerning scheduling of a force-on-force evaluation, which is expected to occur within the next six months during the first quarter of 2007. In response to a question from Mr. Booker, Mr. Meko stated, when scheduling its evaluations, the NRC does review the plant’s schedule for operational or refueling events. In response to a question from Consultant Wardell regarding the “B.5.b” issue (the particulars of which are considered nuclear safeguarded information not for public dissemination), Mr. Meko reported a workshop was held in Washington, D.C. and NRC instruction is expected, with licensee’s required to respond within 90-days, after which B.5.b will be codified into law. Vice President Jacobs commented that the NEI is currently working with the nuclear industry on a B.5.b guidance document.

Dr. Peterson remarked on a comment received following the last public tour of DCPP by the Committee in June 2006, in which a participant expressed concern that the overhead bins of the tour bus were not searched by Security when the bus entered PG&E property. Dr. Peterson commented on the need to instill public confidence concerning security while safeguarding information from a potential adversary, and he remarked that not searching the overhead bins was not a breach of security protocol because the bus and the tour participants never enter the designated protected zone. Mr. Meko agreed with Dr. Peterson’s observations and stated he would consider Dr. Peterson’s suggestion that some of the more robust and obvious security features of DCPP be pointed out and explained to persons taking the Committee’s public tours.

Mr. Chesnut reported that PG&E’s Senior Vice President for Generation and Chief Nuclear Officer, Mr. John S. Keenan, had joined the DCISC meeting. Dr. Rossin thanked Mr. Meko for his important presentation.

Mr. Chesnut requested Mr. Jearl Strickland, DCPP Strategic Projects Manager, make the next presentation to the Committee.

Review of Remaining Schedule for Independent Spent Fuel Storage Facility and Temporary Spent Fuel Storage Rack

Mr. Strickland reviewed for the Committee the location of the Independent Spent Fuel Storage Installation (ISFSI) at the plant site. He reported a construction contract was awarded to Granite Construction and mobilization for construction activities began in September 2005. Excavation at the site is essentially complete, with final grading now underway. Rock bolting and gunite placement is occurring on the excavated, cut slopes. Concrete foundations for 2 of the 7 platforms were poured in July and August 2006 and the Cask Transfer Facility is scheduled for completion in October 2006. Completion of construction is on schedule for December 2006.

Mr. Strickland used photographs to illustrate: the orientation of the ISFSI, which required removal of 100,000 cubic yards to rock; the rock bolts which are 30 feet long and located 5 feet on center and the stainless steel rock-fall fence; preparations for the 2 foundations and the underlying mud matting; the concrete batch plant which produced the nuclear quality concrete which required a continuous pour time of 27-hours; the mud matting’ form work around the perimeter of the foundations, the rebar mats in the foundation; the embedded seismic support structures to be fixed to the foundation slabs and the 20 such structures in the first foundation; and the Cask Transfer Facility which is 14 feet deep.

Mr. Strickland reported the next phase of the ISFSI Project involves completion by Site Services of the connection of electrical and communication facilities and installation of the security system, which is comparable to that required for the power plant, during the first quarter of 2007. In response to Dr. Peterson’s question on whether operation of the ISFSI would affect future public access to the plant overlook, Mr. Strickland replied the ISFSI was specifically configured not to impact access to the overlook site. Mr. Strickland reported the Holtec firm which is fabricating components for the ISFSI has made good progress including completion of the transfer cask, as well as completion and receipt at DCPP of 4 of the 8 multipurpose canisters and 2 of the 8 storage over-packs. Rigging equipment has also been received and the cask transporter is expected to be delivered by the end of April 2007.

Photographs were displayed of: a multipurpose canister; the racking system in the vessel; a storage over-pack; the inside a storage over-pack which is made from two layers of carbon steel separated by a concrete shielding mechanism which will be mixed off-site with hematite to form a denser aggregate with concrete shielding; an upended over-pack; an over-pack with the lid being positioned in place; and a transfer cask. Mr. Strickland stated the over-packs will be bolted to the site then concrete will be poured. In response to a question from Dr. Peterson concerning the type of cask which might be acceptable in the future at the proposed Yucca Mountain waste storage facility, Mr. Strickland stated that the Holtec casks were ‘clean’ although requirements for Yucca Mountain storage have yet to bet determined. Mr. Strickland showed a photo of a transfer cask in a spent fuel pool at the Fitzpatrick Nuclear Plant; the auto-welding equipment; and the transporter with a transfer and storage over-pack on board.

Mr. Strickland reviewed the schedule for operation of the ISFSI as follows:: Startup Program - 3rd Quarter 2007; NRC Dry-run - October 2007; Operational - November 2007; Loading Campaign - 2nd Quarter 2008

Mr. Strickland commented the loading campaign was deferred from its original implementation date to ensure it would not interfere with the plans for the Steam Generator Replacement Project.

Mr. Strickland reported fabrication for the temporary storage racks to be installed in the DCPP spent fuel pools is complete and the racks were expected to be shipped on October 9, 2006, and to be installed during October-November 2006. The temporary racks will provide interim storage for operation of U-1 through 2010 and U-2 through 2011. In response to a question from Consultant Wardell, Mr. Strickland stated currently DCPP does have the capability to do a full core discharge for either unit and use of the temporary racks will extend that capability for both units.

In response to a question from Mr. Conway, Mr. Strickland stated PG&E currently has two inspectors at Holtec’s facilities and an inspector at the Holtec subcontractor’s facility where the transporter is being fabricated and observed the DCPP transporter will be the first such safety-related transporter. In response to Mr. Conway’s inquiry concerning ongoing requirements for surveillance, Mr. Strickland replied DCPP procedures will define surveillance requirements and he reported loading campaigns will be scheduled every two years and the transporter would be unused in the interim. In response to Mr. Conway’s inquiry concerning who will review the procedures, Mr. Strickland replied that Holtec will remain under contract to independently verify DCPP’s procedures.

In response to a question from Consultant Wardell concerning the recent opinion in the federal Ninth U.S. Court of Appeals, Vice President Jacobs replied that the Court found that the ISFSI Environmental Impact Report, not its security or operational reviews, failed to adequately consider the impact of terrorist activities. PG&E has appealed the Ninth Circuit’s decision to the U.S. Supreme Court and is awaiting a decision on whether the Supreme Court will hear its appeal. Mr. Wardell queried whether the NRC would join PG&E and Vice President Jacobs replied that one branch of the federal government is precluded from challenging the opinion of another branch, however, she stated PG&E expects the NRC, the NEI and other nuclear facilities would support PG&E’s position. In response to Consultant Wardell’s question on the present effect of the Ninth Circuits decision on the ISFSI, Vice President Jacobs replied there is no limitation as a result of that decision on construction activities, however, there would be certain risks from the use of the facility. She observed the ISFSI’s structure is similar to and it meets all and more of the requirements met by other, similar, currently operational, facilities. In response to Dr. Rossin’s question concerning PG&E plans in the event the Supreme Court refuses to hear its appeal, Ms Jacobs stated PG&E would need to reconsider the EIR for the ISFSI. Dr. Peterson queried when the Supreme Court might make its decision concerning consideration of PG&E’s appeal and Vice President Jacobs replied that a decision was expected in 3 to 6 months and, if favorable to PG&E, the appeal might be heard within a year thereafter. Dr. Peterson commented that the Ninth Circuit recently handed down a similar decision concerning a project at Lawrence Livermore Nuclear Laboratory and the effect of those decisions could be very broad.

Update on Plant Events, Operational Status and Performance Indicators

Vice President Jacobs reviewed DCPP generation history since the last public meeting of the DCISC in June 2006. She reported U-1 has run safely and reliably over the last four months. U-2 experienced an unplanned reduction to 81% power on June 21 due to an electro-hydraulic fluid leak on Main Turbine governing valve FCV-142. The type of joint which was leaking oil governed the need for the repair and when pressure to the valve was reduced it was found the vendor had not properly torqued the bolts. DCPP is working with the vendor to ensure this does not recur. On August 31, U-2 experienced an unplanned reduction to 73% power, as required by TS, to repair a thimble tube leak. The leaking thimble tube, which can be used to provide access for instrumentation to the reactor core, was identified and isolated. Components of the Movable In-Core Detection System were restored and cleaned. In response to a question from Mr. Conway concerning the source of the leak, Ms. Jacobs replied eddy current testing during U-2’s last refueling outage indicated presence of degradation and this particular tube was adjusted and repaired during that outage. A hardware failure analysis will be performed during U-2’s next refueling outage. In response to a query from Dr. Rossin, Ms. Jacobs confirmed DCPP does not require the tube to continue its capability to do flux mapping of the reactor core. In September, U-2 had a planned power reduction for normal Main Turbine control valve testing.

Vice President Jacobs reported there have been no unplanned automatic reactor trips for either unit since 2002. Collective radiation exposure has not changed, with the last U-2 refueling outage performance of 74-Person-REM representing the best performance for U-2 and for any DCPP refueling outage. She confirmed that there was no reduction in the scope of work to achieve this performance or collective radiation goals. DCPP personnel have had 1 disabling injury during 2006, which puts DCPP in the best quartile for the nuclear industry. Ms. Jacobs confirmed the Industrial Safety Accident Rate data does not include contractor personnel, as it is intended for plant-to-plant comparison. In response to an observation from Consultant Wardell, Vice President Jacobs stated DCPP does not believe an increased emphasis on the accident rate is misplaced, although the number of accidents is small, because all accidents are essentially preventable and any injury is a concern. The INPO Summary Performance Index 12-month rolling average to date for U-1 is 96.3 and for U-2 it is 99.9, with the DCPP combined average currently at 98.1. Ms. Jacobs commented that frequencies vary for updates of individual performance indicators and INPO and the World Association of Nuclear Operations (WANO) initiated a change to the Index in 2006 which resulted in many plants falling approximately 5 points, however, DCPP’s performance on the Index actually improved slightly due to that change. The two INPO Summary Performance Index performance indicators which currently affect DCPP performance in a negative manner are Unit Capacity Factor and Collective Radiation Exposure for U-1 and these remain focus areas for improvement.

Activities of PG&E’s Nuclear Safety Oversight and President’s Nuclear Advisory Committees.

Vice President Jacobs stated that PG&E’s President’s Nuclear Advisory Committee (PNAC) and the DCPP Nuclear Safety Oversight Committee (NSOC) have recently reviewed many of the same issues as the DCISC including plant performance, the INPO mid-cycle evaluation, the containment sump issue and training. She reported the DCPP Operations training program received its accreditation review last year and the technical training programs will be reviewed for continued accreditation next year. Ms. Jacobs briefly described for the Committee the systematic approach utilized by the Performance Roll-up Process, including use of performance improvement coordinators and commented the Roll-up Process involves the corrective action process, common trend assessment, observation and training feedback. Dr. Rossin confirmed Vice President Jacob’s suggestion that the Performance Roll-up Process might provide a suitable future Fact-finding topic for the Committee and she assured the Committee that the process will not be used merely to create a single number type of indicator from a set of data.

Mr. Conway queried concerning the interviews with Operations crews conducted by a member of the NSOC to review issues raised by the crews and the findings made as a result of those interviews. Vice President Jacobs replied that she and DCPP Station Director Mr. Jim Becker have scheduled meetings with Operations crews to discuss and address their issues and confirmed, in response to a followup observation by Mr. Conway, that DCPP will ask the NSOC members to review the results of management’s efforts.

Strategic Plans and Transformation.

Mr. Chesnut reviewed the business and cultural transformation efforts underway and the relationship of PG&E’s goals, strategies and values to those cultural transformation efforts. Implementation of PG&E’s vision of the transformation includes the development of operational strategies and the assessment of DCPP’s capabilities to allow the plant to be the best performing nuclear plant and the efforts to launch initiatives to that end. In response to a question from Dr. Sheinberg, Mr. Chesnut stated there was no single metric to accurately measure per se a determination of best performing plant in the industry, however, he stated that DCPP’s continuing to strive to be a top performing plant should result in that recognition. He briefly reviewed with the Committee the integrated areas of the transformation process and the strategic initiatives to be used to achieve results.

Mr. Chesnut and Vice President Jacobs discussed with the Committee PG&E’s company-wide efforts to communicate the idea of using culture as a ‘launching pad’ to become the leading utility in the United States. Company-wide presentations, including a presentation at DCPP, entitled “PG&E Tomorrow” which use the same slides as presented to the DCISC, have been held with PG&E’s Chief Executive Officer in attendance and included breakout sessions with the leadership team. Ms. Jacobs briefly reviewed the events held at other PG&E facilities and the information imparted at those events concerning the part played by DCPP in the Cultural Transformation efforts.

Mr. Chesnut reviewed DCPP’s efforts to become part of the nation’s leading utility and stated this direction necessarily includes becoming a leader in nuclear. He stated DCPP measures itself against industry-best performers and considers its breaker-to-breaker runs, improved equipment reliability, success in meeting refueling outage performance goals and top quartile ALARA performance in this assessment. Dr. Peterson queried whether safety as a goal can be measured in this assessment by specific metrics or is viewed as an objective. Vice President Jacobs replied the focus on measures and goals in the Cultural Transformation context is on industrial safety rather than nuclear safety, which uses risk with equipment, outage performance and the unavailability of safety significant systems as measures. Operational excellence in the Cultural Transformation context centers on areas with identified gaps to top performance.

Mr. Chesnut stated DCPP supports PG&E’s Transformation vision and gave examples of DCPP’s energizing its employees including improving human performance and safety by having 5 event-free clock resets and collective radiation exposure results of < 108 REM for the station. Improvement in generation availability has been achieved by successful resolution of 8 long-standing equipment issues during 2006, and improving overall equipment performance. Transformation process ‘shareholders’ have also been rewarded as part of the DCPP Performance Plan through completion of all self-assessments, by benchmarking to improve performance, the completion of 2R13 in 39 days and by replacing the Plant Information System with SAP software. Dr. Peterson commented it might be valuable for the DCISC to follow up concerning how these efforts fit within the theme of public safety. Consultant Wardell queried whether these measures were included at a higher level in the PG&E Business Plan and Mr. Chesnut confirmed the Business Plan identifies initiatives as areas of focus for improvement and the applicable metrics include industry leading performance improvement plans.

Mr. Chesnut discussed the meaning of the Transformation plan to DCPP as including becoming an industry leader in industrial and nuclear safety, operational excellence in managing and running its business, embracing a relentless passion for performance improvement and continued investment in DCPP. As Generation Services Director, Mr. Chesnut identified as principal Transformation efforts at DCPP the SAP conversion, including the Nuclear Excellence Information System (NEXIS) and the integration of human relations and payroll data, as evidence of demonstrated support and engagement in cultural and business transformation to allow DCPP to build on focus areas and the centralization of functions including human relations support, information technology support and strategic sourcing.

In response to an observation by Consultant Wardell, Mr. Chesnut confirmed that his role as Generation Services Director encompasses more than nuclear generation and includes his involvement with other, non nuclear, generation sources and the role is part of the Transformation process with a mandate to look for areas and opportunities for PG&E to lead. Dr. Peterson commented the University of California was also currently undertaking a similar assessment and he remarked that the Transformation process as presented is an overview, and he queried how the Committee might monitor DCPP in achieving specific goals and objectives concerning issues related to safety. Vice President Jacobs and Mr. Chesnut suggested the Committee look to plant performance, with its full complement of metrics, and to links to identified goals and safety including 38 metrics linked to each objective with measures for each. Vice President Jacobs commented, however, that linking and mapping different categories of goals concerning the Transformation process may not be of significant value.

Mr. Chesnut introduced Mr. Bob Exner, Generation Services Director to make the next information presentation.

Update on the New Steam Generators.

Mr. Exner reported fabrication of the new U-2 steam generators (SGs) is on schedule. The SGs are being fabricated by the ENSA firm in Spain and are scheduled for delivery in November 2007. The first two SGs are tubed and the third SG has had about one half of its tubes inserted. The fourth U-2 SG is scheduled to begin tube insertion in ENSA’s clean room in about two weeks. The upper assemblies, including the feed rings and steam separators are being assembled, and welding of the channel head to the bottom of the first SG should occur in the next two weeks.

Mr. Exner commented that a licensing report and analysis are scheduled to be submitted with a License Amendment Request to the NRC by the end of this year, with a briefing with NRC staff to follow next Spring. PG&E expects the License Amendment Request approval process will take approximately one year. Mr. Exner stated the Quality Assurance performance has been good. DCPP has had full time eddy current analyses of the SG tubes performed by its own inspectors on duty at the tubes’ manufacturer, Sandvik Steel of Sweden. Two full time PG&E resident inspectors are also on site at the ENSA facility. Mr. Exner and Vice President Jacobs visited ENSA in July to review fabrication activities and Westinghouse has also been involved in quality review of the replacement SGs. He commented the tubing for the DCPP replacement SGs is of the highest quality. Plans for pre service inspections and shipping are now being finalized at ENSA, including full eddy current and welding examinations. In response to a comment from Mr. Conway, Mr. Exner replied PG&E was well aware of the experience of the Palo Verde Nuclear Plant, where a new SG experienced a leak due to a screw from the tube boxing having been driven into a tube and that tube subsequently left in service.

Mr. Exner provided photos of the fabrication activities for the members’ review including: a tube bundle from Sandvik ready for installation in the first SG at ENSA; the first tube being installed; tube end welding; the first SG with its complete tube bundle and anti vibration bars installed; and the July 2006 inspection visit to ENSA.

Mr. Exner stated an installation contract has been entered into with the SGT firm and design change packages are now being developed, with 2 of the 20 design change packages now in final form, with the balance to be completed by next Spring. Development is beginning on approximately 150 work packages which will be necessary. Planning is now being undertaken in detail for 1R14, which will be the outage preceding the first installation of the replacement SGs. On-site staff is now being assembled, and currently there are about 40 persons now working on the Steam Generator Replacement Project at DCPP. Activities are on schedule for the start of 2R14, scheduled for February 6, 2008.

PG&E has submitted an application for a building permit for construction of the Old Steam Generator Storage Facility to be constructed on site and a pre application took place in September. A pre bid meeting with five interested contractors was conducted and PG&E expects to award a construction contract in January 2007. DCPP is preparing for an end of year hearing before the California Coastal Commission to obtain a Coastal Development Permit. Mr. Exner described the Project’s challenges as completion of California Coastal Commission regulatory negotiations; communicating and integrating the Project with the entire DCPP organization to ensure staff understands their roles within the Project. Working agreements and task plans are being developed, combining all 2R14 and 1R15 non-Steam Generator Replacement Project scope and Steam Generator Replacement scope into integrated outages and efforts concerning scope clarification and compression are ongoing to ensure DCPP does not try to do too many things during these long duration SG replacement outages.

Mr. Exner concluded this presentation by reporting the Steam Generator Replacement Project is currently on schedule for successful completion for U-2 during the second quarter of 2008 and for U-1 during the second quarter of 2009. In response to a question from Consultant Booker, Mr. Exner stated the replacement SGs will be located in Parking Lot 7 at DCPP when PG&E accepts responsibility and ownership.

The Chair thanked Mr. Exner for an excellent presentation.

XX. Adjourn Evening Meeting

The Chair announced the DCISC public tour of DCPP will assemble at PG&E’s Community Center at 8:00 A.M. tomorrow morning. The evening meeting of the Committee was then adjourned by the Chair at 7:40 P.M.

XXI. Public Tour of Diablo Canyon Nuclear Power Plant

The Members of the DCISC accompanied by 50 members of the public, PG&E tour guides and the Committee’s consultants, conducted a tour of DCPP. The members of the public responded to the DCISC announcement for a public tour of the Plant. The group met at the PG&E Community Center for an introduction and background of the Committee. PG&E representatives provided a brief overview of DCPP, including its history, operation, the nuclear fuel cycle and spent fuel storage, and plant security. PG&E discussed how the cooling systems work, with the ocean water two barriers away from the reactor itself. The group then departed for the DCPP.

The group drove by the Independent Spent Fuel Storage Installation (ISFSI) for a description of its purpose and features. Driving by the Plant overlook, the group received briefings from PG&E representatives on the various external features and buildings and on spent fuel storage. At the control room simulator (a full-scale mock-up of the U-1 control room) viewing room, PG&E discussed plant controls, operator training and accident response. Next, near the Plant Intake Structure and Discharge Structure, the group viewed the intake facilities where DCPP pulls in and expels cooling water from and into Diablo Cove and the group then visited the Security building for a demonstration of screening of personnel entering the Protected Area of the plant. During the return to the Community Center, the group received a presentation on radiation protection and had an opportunity for questions and discussions with the DCISC.

XXII. Questions & Comments from the Public

During the ride back and at the Community Center after the tour, the public took the opportunity to ask questions of Committee members. Comment cards were provided to and collected from tour participants.

XXIII. Conclude Public Tour

XXIV. Reconvene for Afternoon Meeting

The afternoon meeting of the DCISC was called to order by Committee Chair, Dr. A. David Rossin, at 1:30 P.M.

XXIV. Introductory Comments

The Chair reviewed the schedule for future public meetings of the Committee during 2007: January 31-February 1, June 19-20 (now June 13-14) and October 24-25.

XXVI. Public Comments and Communications

The Chair invited any members of the audience to address remarks to the Committee at this time. There were no remarks from the public at this time.

XXVII. Information Items Before the Committee (Cont’d)

Mr. Chesnut reported, in response a question from the Committee during Vice President Jacobs earlier presentation on DCPP operational performance, turbine valve testing is performed on intervals of six months and a reduction in power operations for such testing is required.

Mr. Chesnut observed that PG&E Senior Vice President and Chief Nuclear Officer Mr. John S. Keenan was present for this session of the DCISC’s public meeting.

Mr. Chestnut asked Mr. David Taggart, Manager, Quality Verification, to make the next presentation to the Committee.

Quality Verification Report on Second Quarter 2006 Quality Performance Assessment Report (QPAR) and Discussion of Trends Over the Past Year; QPAR Comparison with Results of Mid-Cycle Review.

Mr. Taggart stated DCPP continued to be operated safely and conservatively over the Second Quarter of 2006, and overall operational performance indicators continued to show improvement. The last refueling outage for U-2 showed gaps to excellence still exist in planning, scope control and in some areas of execution. Outage challenges requiring attention included maintenance work processes and industrial safety which are behavior and standard based activities. He stated that the Maintenance craft’s quality of actual field work significantly contributed to improving equipment and plant reliability.

Mr. Taggart reviewed and discussed with the Committee the 2006 Performance Improvement audit results which, he stated, indicate overall improvement from the previous 2004 audit and the 2005 assessment performed of the Corrective Action Program. Overall performance was found to be adequate, with good performance identified with conduct of the Corrective Action Review Board (CARB). Good performance of formal cause analysis was identified, however, apparent cause evaluations require improvement. In response to a question from Dr. Peterson, Mr. Taggart replied formal cause analysis focuses a rigorous analysis on the most significant issues, while apparent cause analysis deals with lesser problems in a less rigorous fashion but within a defined process. Mr. Conway questioned as to what happens after a need for improvement in apparent cause analysis has been identified? Mr. Taggart answered that essential elements will be identified and instilled and specific issues identified and addressed. In response to Mr. Conway’s question about a followup process, Mr. Taggart remarked quality problems are identified and tracked, to determine if the remedial actions previously identified were taken, and selective elements and past problems are further reviewed for effectiveness, accuracy of audit findings and trend identification. Mr. Conway questioned whether follow up is conducted concerning all issues, and Mr. Taggart replied in the affirmative, either with immediate or subsequent verification and, in response to Mr. Conway’s question concerning identification of insufficient actions, Mr. Taggart stated the process itself would then be identified as a problem. In response to Mr. Conway’s question concerning whether concerns would then be elevated to management level, Mr. Taggart observed that, if corrective action remains a problem, the issues could be elevated to the non conformance level. In response to Mr. Wardell’s question about metrics used by the Corrective Action Program to prevent repeat problems, Mr. Taggart stated repeat problems are themselves a metric and a valid indicator, as is review of the effectiveness of corrective actions, the QPAR and the Problem Prevention and Resolution Report. In response to Mr. Wardell’s question about tracking past events, Mr. Taggart replied apparent cause is used to determine whether a previous problem was identified and what corrective actions were taken. Mr. Taggart stated the QPAR and the status and effectiveness of Quality Programs are reviewed in Quality Assurance’s performance-based audits and assessments for adequacy and effectiveness as well as for compliance with INPO requirements. In response to a question from Consultant Booker concerning what the line organization does with the QPAR, Mr. Taggart replied that Operations does a good job of integrating the QPAR, however, other departments are inconsistent and correction and followup rely on the Corrective Action Program.

Mr. Taggart stated that low level issues and identified gaps to excellence have been identified at DCPP and are potential warning flags unless carefully managed by the plant’s line organizations. He stated the Performance Roll-up Process should assist the line organizations in this area. The recent mid-cycle evaluation provided good insights, such as the need to engage employees to identify solutions for corrective actions in areas identified as industry gaps. Mr. Taggart reported that the mid-cycle evaluation and Quality Verification’s audits and assessment results are generally consistent. In response to a question from Dr. Sheinberg concerning what PG&E will do with the insights from the mid-cycle evaluation, Mr. Taggart used the example of the industrial safety results, where a cross section of the plant’s workforce was engaged to identify problems and potential solutions, including having DCPP workers benchmark with other nuclear plants to instill their ownership in the solutions developed. Dr. Sheinberg observed that a sustainable strategy must engage employees over a period of time and Mr. Taggart confirmed that cause analysis engages the workforce by involving them in a discussion of potential solutions.

Mr. Taggart reviewed and discussed with the Committee members and consultants departmental operations summaries for DCPP:

Operations Sections

Good Performance: - Step change in improvement; - Communications practices especially during fuel load and reload
Gaps to Excellence: - Plant status control and human performance which the Corrective Action Program is addressing

Mr. Wardell questioned whether issues concerning plant status control from previous refueling outages were addressed and Mr. Taggart replied that implementation of the eSOMS clearance process

Maintenance Department

Good Performance: - Quality of maintenance workmanship has improved equipment and plant reliability
Gaps to Excellence: - Administrative work processes and behaviors continue to warrant improvement, work is getting done but processes need to improve; - Key issues continue with work package quality, human performance, procedure use and adherence, and place keeping in the procedures; - Foreign Material Exclusion (FME) and rigging implementation were outage issues; - Human performance

Mr. Wardell inquired regarding the administrative work control process and Mr. Taggart replied that prioritization and execution of work require further attention. Mr. Conway reviewed a letter dated June 29, 2006, regarding 2R13 audit activities which stated DCPP will be unable to achieve top level performance until mispositioning and procedure use issues in Maintenance are addressed and improve. Mr. Taggart stated those issues are currently within the Corrective Action Program but actions are not complete. Mr. Conway observed that in July and August 2006, mispositioning events actually increased and Mr. Taggart stated these issues were again raised in the QPAR. In response to Mr. Conway’s query whether either or both of these issues were raised with higher management, Mr. Taggart stated the DCPP management team has received this as an indicator and he confirmed that these issues are receiving attention. Mr. Booker inquired if the Maintenance line organization agreed with the identified gaps and Mr. Taggart replied in the affirmative and he commented that Maintenance has provided a schedule to address the gaps.

Radiation Protection

Good Performance: - Improved ALARA awareness and leadership; - Radiological Environmental Monitoring Program

Engineering Department

Good Performance: - System engineering advocacy; - In-service Inspections; - Reactor engineering; - Use of the engineering human performance simulator
Gaps to Excellence: - Project engineering technical oversight of vendor engineering regarding NRC Generic Letter 2004-02 recirculation sump analytical work concerning which Quality Assurance identified technical errors

Security Section

Good Performance: - Fitness for duty program implementation; - Successful force-on-force drill; - Effective corrective actions regarding control of security safeguards information

Outage Management Section

Good Performance: - Effective leadership; - Effective process improvements, including office, communication and process improvements; - Overall focus on outage fundamentals, serving as a model for DCPP
Gaps to Excellence: - Outage planning milestones need additional attention and documentation; - Scope control, to ensure outages are not overloaded with work

Work Control Section

Good Performance: - Category A schedule performance and schedule adherence; - Corrective maintenance AR backlog at “industry best” level
Gaps to Excellence: - Elective maintenance backlog; - Category B schedule adherence

Dr. Rossin observed that a nuclear plant exists in a licensing/regulatory environment and numbers and statistics are closely monitored, he queried whether DCPP has sufficient resources focused on its elective maintenance tasks. Mr. Taggart replied resources are available and are being applied, but at times emergent work takes away necessary resources.

Emergency Preparedness (EP) and Emergency Response Organization (ERO)

Gaps to excellence: - ERO backup team vacancies due to attrition and retirement; - EP equipment adverse trend related to communications tools

In response to a query from Consultant Wardell, Mr. Taggart confirmed all ERO teams are now, and have remained, fully staffed; however, required backup personnel are sometimes required to do double duty.

Mr. Wardell questioned whether the defined gaps to excellence include unsatisfactory or deficient items and, if so, how would Mr. Taggart characterize failing items? Mr. Taggart responded that unsatisfactory and deficient items are identified as gaps to excellence; however, unsatisfactory or deficient items might also be categorized by findings, resulting in quality problems and may involve regulatory aspects. Gaps to excellence reflect PG&E’s desire that DCPP exceed regulatory requirements in achieving excellent performance. Mr. Taggart observed that issues identified with Operations and Maintenance represent deficient performance, and procedural adherence problems also represent deficiencies. In response to Mr. Wardell’s query concerning how the line organization would distinguish the difference, Mr. Taggart replied the Corrective Action Program clearly identifies whether an issue has a regulatory aspect.

Mr. Taggart reviewed, not necessarily in their order of importance, DCPP’s key station Quality Performance issues including:: Industrial Safety Behaviors, Standards and Results; Outage Preparedness; Long-standing Equipment Issues; Performance Improvement in Apparent Cause Evaluation Quality;; Benchmarking; Self Assessment and Training; Human Performance for Maintenance and Operations; Operations Mispositioning Error Rate; Maintenance Processes and Work Practices in Documentation;; Procedure Adherence and Work Package Quality

In response to a question from Consultant Booker concerning when PG&E expects to resolve its long-standing equipment issues, Mr. Taggart and Mr. Chesnut stated that a number of these issues were addressed during the last refueling outage cycles, and certain others will be addressed in the upcoming refueling outage cycle. DCPP met its station goal for resolving its long-standing equipment issues during 2006. A self assessment was performed on the long-standing equipment issue, and infrastructure which was previously not in place to prioritize these issues has now been developed and is in place.

In concluding his presentation, in response to a question from Dr. Sheinberg concerning the difference in meaning between performance improvement and learning organization categories, Mr. Taggart observed INPO defines apparent cause evaluation, benchmarking, self assessments and training as within INPO’s performance improvement category and he observed, and Dr. Sheinberg agreed, that the concept of a learning organization relates to instilling a mind set and concerns issues of process.

Mr. Chesnut introduced Mr. Ken Peters, Engineering Director at DCPP.

Status of the NRC Containment Sump Issues.

Mr. Peters reported DCPP is required to be designed for several extremely low probability but significant accident scenarios. One postulated event involves a loss of coolant accident (LOCA) scenario with a break of a large pipe inside containment which releases high energy steam. The steam jet could damage adjacent material such as insulation and paint or other coating material. Following such a postulated LOCA, water would be collected in the containment sump, strained of the loosened material, and then pumped back into the reactor to cool the core. These straining functions are performed by the containment recirculation sump strainer. Mr. Peters stated that during 2000 and 2001, DCPP proactively enlarged its approximately 30 sump screens to improve their design and increase debris removal capacity. Normally, pressurized water reactors (PWRs) such as DCPP have on the order of 100-200 square feet of sump screens while, after the modifications, DCPP U-1 now has 700 and U-2 750 square feet of sump screen.

In 2004, the NRC issued a Generic Letter to PWR nuclear facilities establishing new requirements for containment recirculation sump strainers. This letter raised issues concerning the potential for debris blockage by insulation or similar materials of coolant recirculation following design basis accidents. PWR were requested to make a conservative evaluation of their current design and to provide by the end of 2007 any necessary analyses, modifications, including upgrading the screens and increasing their size, and testing. DCPP determined its sump strainer design must be improved using two possible strategies: reducing the amount of material that could be damaged in an accident and contribute to clogging the strainer; and providing a larger strainer. Debris material could be reduced be removing, encapsulating or replacing fibrous insulation on piping and electrical cables, by installing interceptors to capture paint chips and reflective metal piping insulation and by opening flow paths to divert debris away from the strainer.

Mr. Peters stated a contract has been awarded for the design and fabrication of new containment recirculation sump screens and the new screens will increase available surface area to approximately 3,500-4,000 square feet. Performance testing of the new screens and new insulation will be conducted during November 2006, using DCPP-specific debris and U-1 is scheduled for replacement of its recirculation sump strainer during 1R14 in Spring of 2007 and U-2 during early 2008 in 2R14. Mr. Peters displayed a photo of the proposed strainer design and confirmed it will fit within the existing containment recirculation sump strainer’s footprint. In response to a question from Consultant Wardell, Mr. Peters confirmed the design might undergo slight modification based upon the results of the November 2006 tests and he stated approximately 40 pounds of insulation will remain following the modification. DCPP personnel, working with PG&E research staff, developed a number of design alternatives and specific recommendations will be provided by an independent team of technical experts to ensure the final design meets the challenges of the NRC’s Generic Letter. As U-2 will not have its modification installed until 2008, PG&E must seek a special exception from the NRC for a scheduling modification. In response to a question from Mr. Conway, Mr. Peters confirmed the NRC has issued specific guidance regarding such exception requests and he confirmed the NRC’s project manager is very conversant with DCPP’s situation. In response to Mr. Conway’s observation, Mr. Peters confirmed performance testing and regulatory approval for the new recirculation sump strainer is proceeding in parallel and Mr. Peters stated the key date to ensure the testing and approval paths will converge is the conclusion of testing by the end of November 2006. Mr. Peters, in response to Mr. Conway’s inquiry, confirmed DCPP is primarily concerned about insulation as a source of clogging and has a high level of confidence that coatings will not significantly cause clogging of its sump screens. Mr. Chesnut confirmed DCPP has a containment coating inspection and testing program. In response to a question from Dr. Rossin, Mr. Peters stated the NRC has provided plant-specific information concerning issues which must be addressed. Operations training and the need for additional water storage are being evaluated on a plant-by-plant basis. In response to an observation by Dr. Peterson, Mr. Peters confirmed that chemical reactions, such as those produced by the presence of aluminum or sodium hydroxide have been evaluated and addressed in the new design. Consultant Booker commented that the QV organization discovered some problems with the new analysis and Mr. Peters responded that the Quality Assurance organization now has a representative on the team. In response to Consultant Wardell’s question concerning what else DCPP may consider doing to address the NRC’s concerns, Mr. Peters confirmed that DCPP has raised the amount of water in its refueling water storage tank and is reviewing the need for and uses of containment spray.

In conclusion, and in response to Dr. Rossin’s question concerning why this issue, which has been a concern in the nuclear industry for some time, is now being addressed, Mr. Peters replied that the NEI and NRC have done research which overwhelmingly concluded, with reference to containment sump screen design bigger is simply better and PG&E’s research has confirmed this. With its new design and plans, DCPP will fully comply with the new requirements of the NRC’s Generic Letter.

Mr. Peters continued at the podium to make the final informational presentation.

Status of Long-Standing System & Equipment Issues.

Mr. Peters stated the DCPP 2006 Business Plan included a list of existing equipment issues to be specifically addressed during 2R13, all of which were completed. These include:: Emergency Core Cooling System voiding modifications - made in response to a generic industry issue of open gas voids potentially degrading pump performance. A void collection chamber was installed in U-2 during 2R13, U-1 received this modification previously.; Containment Fan Cooler Unit modifications - made to reverse potential reverse rotation of these fans used to reduce temperature and pressure in containment during an accident. Minor modifications were performed to the louver system and maintenance instructions were improved, although Mr. Peters commented maintenance on these fans is extensive and they are difficult to work on. DCPP continues to work on development of a modification for an anti reverse rotation device. In response to an observation by Dr. Rossin, Mr. Peters confirmed the fans are in the Plant TS and Mr. Chesnut commented when DCPP evaluated the amperage necessary to engage and reverse a fan from potential reverse rotation, margins were potentially compromised and this provided the impetus for this modification. Mr. Conway inquired whether DCPP felt it had addressed the significant Problem Identification & Resolution NRC performance cornerstone issue for which the plant was ‘flagged’ earlier and Mr. Peters confirmed DCPP believes it has done so and confirmed Mr. Conway’s observation that this should result in a change of color for that performance indicator.; Emergency Diesel Generator lube oil supply valve relocation - completed now for U-2, U-1 should have this modification by the end of 2006.; Emergency Generator Lube Oil “Coking” - due to the lube oil heaters originally being installed in a vertical position, causing the oil to coagulate and harden. The lube oil heaters are now mounted horizontally on 3 of the 6 emergency diesel generators and the final 3 emergency diesels will have this modification done by the end of 1R14 in May 2007.; Auxiliary Feedwater Temperature Alarms - insulation modified to prevent unnecessary alarms.; Centrifugal Charging Pump (CCP) 2-1 Vibration - the rotating element was replaced during 2R13 and the pump pedestal stiffened.

In summarizing his report, Mr. Peters stated actions have been taken to complete all long-standing equipment issues identified in DCPP’s 2006 Business Plan. In response to a query from Consultant Booker concerning a long-standing equipment issue list for 2007, Mr. Peters replied that would be a part of DCPP’s 2007 Business Plan. In response to a query from Consultant Wardell, Mr. Peters stated the positive displacement charging pumps will be replaced by centrifugal charging pumps during each of the next two refueling outages and fire protection piping replacement, due to corrosion, for the start-up transformers has been completed for U-2 and will be completed for U-1 during its next refueling outage and these items will then no longer be considered to be long-standing equipment issues. He confirmed the existing list of long-standing equipment issues will be resolved and the Plant Health Committee will continue to review and identify long-standing equipment issues. Mr. Wardell commented the Fire Protection System has been reviewed by the DCISC and that system is not expected to return to white performance indicator status until 2011 or 2012. Mr. Peters replied that he was unfamiliar with the specifics of that system but the Plant Health Committee uses a prioritized matrix to identify and address these types of issues and Mr. Wardell confirmed his impression that the system was much improved.

This concluded the informational presentation for this public meeting.

XXVIII. Concluding Remarks & Discussion by Committee Members of Future DCISC Activities

The Chair commented that the morning’s public tour of DCPP was one of the most successful yet given by the Committee, and included a large number of Cal Poly students. Mr. Wellington remarked that the feedback forms he received were uniformly positive and appreciative of the opportunity to tour DCPP.

Dr. Rossin thanked Mr. Chesnut and all the PG&E presenters for the high quality of their presentations. Mr. Chesnut thanked the Committee for the opportunity to make the presentations to the Committee and to the public.

XXIX. Adjournment of Forty-Ninth Public Meeting

There being no further business, the forty-ninth public meeting of the Diablo Canyon Independent Safety Committee was adjourned by the Chair at 3:10 P.M.

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For more information about DCISC contact:

Diablo Canyon Independent Safety Committee
Office of the Legal Counsel
857 Cass Street, Suite D, Monterey, California 93940
Telephone: in Califonia call 800-439-4688; outside of California call 831-647-1044
Send E-mail to: dcsafety@dcisc.org

Diablo Canyon Independent Safety Committee

Minutes of the Diablo Canyon Independent Safety Committee October 2006 Public Meeting [17th Annual Report, Exbibit B.3] (As approved at the January 31-February 1, 2007, Public Meeting.)

Tuesday & Wednesday, October 18-19, 2006, Shell Beach, California

Notice of Meeting

Agenda

I. Call to Order - Roll Call

II. Introductions

III. Public Comments and Communications

IV. Consent Agenda

V. Action Items

A. DCISC 16th Annual Report on Safety of Diablo Canyon Operations; July 1, 2005 - June 30, 2006:

B. Update on Financial Matters and Committee Activities:

C. Discussion of Issues on Open Items List:

VI. Committee Member Reports and Discussion

A. Public Outreach, Site Visits and Other Committee Activities: Members observed that a public tour of DCPP is scheduled for 8:00 A.M. on Thursday, October 19, 2006.

B. Documents Provided to the Committee:

VIII. Staff-consultant Reports & Receive, Approve and Authorize Transmittal of Fact-finding Reports to PG&E

IX. Correspondence

X. Adjourn Morning Meeting

XI. Reconvene for Afternoon Meeting

XII. Committee Member Comments

XIII. Public Comments and Communications

XIV. Information Items Before the Committee

Maintenance Department Overview

Mid-Cycle Review and Subsequent Ongoing Efforts

Review of the Fourteenth Refueling Outages for Both Units (1R14 & 2R14).

Inspection of the Intake Structure during the Thirteenth Refueling Outages for Both Units (1R13 & 2R13) and Repair Plans.

XV. Adjourn Afternoon Meeting

XVI. Reconvene for Evening Meeting

XVII. Committee Member Comments

XVIII. Public Comments and Communications

XIX. Information Items Before the Committee (Cont.)

Review of NRC Notices of Violations, Licensee Event Reports and NRC Performance Indicators.

Update on Security Improvements.

Review of Remaining Schedule for Independent Spent Fuel Storage Facility and Temporary Spent Fuel Storage Rack

Update on Plant Events, Operational Status and Performance Indicators

Activities of PG&E’s Nuclear Safety Oversight and President’s Nuclear Advisory Committees.

Strategic Plans and Transformation.

Update on the New Steam Generators.

XX. Adjourn Evening Meeting

XXI. Public Tour of Diablo Canyon Nuclear Power Plant

XXII. Questions & Comments from the Public

XXIII. Conclude Public Tour

XXIV. Reconvene for Afternoon Meeting

XXIV. Introductory Comments

XXVI. Public Comments and Communications

XXVII. Information Items Before the Committee (Cont’d)

Quality Verification Report on Second Quarter 2006 Quality Performance Assessment Report (QPAR) and Discussion of Trends Over the Past Year; QPAR Comparison with Results of Mid-Cycle Review.

Operations Sections

Maintenance Department

Radiation Protection

Engineering Department

Security Section

Outage Management Section

Work Control Section

Emergency Preparedness (EP) and Emergency Response Organization (ERO)

Status of the NRC Containment Sump Issues.

Status of Long-Standing System & Equipment Issues.

XXVIII. Concluding Remarks & Discussion by Committee Members of Future DCISC Activities

XXIX. Adjournment of Forty-Ninth Public Meeting

For more information about DCISC contact:

Diablo Canyon Independent Safety Committee Office of the Legal Counsel857 Cass Street, Suite D, Monterey, California 93940Telephone: in Califonia call 800-439-4688; outside of California call 831-647-1044 Send E-mail to: dcsafety@dcisc.org

Diablo Canyon Independent Safety Committee
Office of the Legal Counsel
857 Cass Street, Suite D, Monterey, California 93940
Telephone: in Califonia call 800-439-4688; outside of California call 831-647-1044
Send E-mail to: dcsafety@dcisc.org