ML13081A664

NRC Staff'S Proposed Findings of Facts and Conclusions of Law Part 4: Contention NYS-8 (Transformers)

ML13081A664
Person / Time
Site:	Indian Point
Issue date:	03/22/2013
From:	Mizuno B NRC/OGC
To:	Atomic Safety and Licensing Board Panel
SECY RAS
References
RAS 24264, 50-247-LR, 50-286-LR, ASLBP 07-858-03-LR-BD01
Download: ML13081A664 (48)

Text

UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD In the Matter of )

)

ENTERGY NUCLEAR OPERATIONS, INC. ) Docket Nos. 50-247-LR/ 50-286-LR

)

(Indian Point Nuclear Generating )

Units 2 and 3) )

NRC STAFFS PROPOSED FINDINGS OF FACT AND CONCLUSIONS OF LAW PART 4: CONTENTION NYS-8 (TRANSFORMERS)

Beth N. Mizuno Counsel for NRC Staff March 22, 2013

i Table of Contents I. BACKGROUND AND INTRODUCTION .................................................................................. 2 A. Contention NYS-8 .......................................................................................................... 2 B. Regulatory Background .................................................................................................. 4 C. Applicable Legal Standard .............................................................................................. 8 II. FINDINGS OF FACT............................................................................................................. 9 A. Witnesses Presented...................................................................................................... 9 B. Electrical Transformer Operation. ..................................................................................16 C. Monitorability of Transformer Performance and Condition .............................................19 D. Comparison of Transformers to Active and Passive Components .................................27

1. Active Components ............................................................................................................ 27 Transistors...28 Batteries...29 Battery Chargers.30 Power Inverters, Power Supplies, Circuit Boards, and Circuit Breakers...32

2. Passive Components ......................................................................................................... 33 Pipes.33 Cables..35 Reactor Pressure Vessel, Containment, and Steam Generator.37 E. The Absence of Transformers in 10 C.F.R. § 54.21 .......................................................38 F. Summary of Findings.....................................................................................................43 III. CONCLUSIONS OF LAW ....................................................................................................44

March 22, 2013 UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD In the Matter of )

)

ENTERGY NUCLEAR OPERATIONS, INC. ) Docket Nos. 50-247-LR/ 50-286-LR

)

(Indian Point Nuclear Generating )

Units 2 and 3) )

NRC STAFFS PROPOSED FINDINGS OF FACT AND CONCLUSIONS OF LAW PART 4: CONTENTION NYS-8 (TRANSFORMERS)

In accordance with 10 C.F.R. § 2.1209 and the Atomic Safety and Licensing Boards Orders, 1 the NRC Staff (Staff) hereby submits its proposed findings of fact and conclusions of law (Proposed Findings or PFF) regarding the nine contested Track I contentions in this proceeding. The Staffs Proposed Findings are set forth in ten separate filings, as follows:

Part 1: Overview and Regulatory Standards; Part 2: Contention NYS-5 (Buried Piping and Tanks);

Part 3: Contention NYS-6/7 (Inaccessible Non-EQ Medium and Low Voltage Cables);

Part 4: Contention NYS-8 (Transformers);

Part 5: Contention NYS-12C (Severe Accident Mitigation Alternatives (SAMA) Analysis Decontamination and Cleanup Costs);

Part 6: Contention NYS-16B (SAMA Analysis Population Estimates);

Part 7: Contention NYS-17B (Real Estate Values);

Part 8: Contention NYS-37 (No-Action Alternative);

1 See (1) Scheduling Order (July 1, 2010), at 19; and (2) Order (Scheduling Post-Hearing Matters and Ruling on Motions to File Additional Exhibits) (Jan. 15, 2013) at 1.

2 Part 9: Contention RK-TC-2 (Flow Accelerated Corrosion); and Part 10: Contention CW-EC-3A (Environmental Justice). 2 In Part 4 of the Staffs Proposed Findings, set forth below, the Staff addresses the issues raised in Contention NYS-8 (transformers). For the reasons set forth herein, the Staff submits that Contention NYS-8 should be resolved in favor of license renewal for Indian Point Nuclear Generating Units 2 and 3.

I. BACKGROUND AND INTRODUCTION 4.1. These findings and rulings address all outstanding issues with respect to the contention filed by the State of New York (New York), Contention NYS-8, concerning the treatment of transformers in the license renewal application (LRA) filed on April 23, 2007, by Entergy Nuclear Operations, Inc. (Entergy or Applicant) for Indian Point Nuclear Generating Units 2 and 3 (Indian Point or IP2 and IP3). An overview of this proceeding and the regulatory standards that govern consideration of the IP2 and IP3 LRA are set forth in Part 1 of the Staffs Proposed Findings, submitted simultaneously herewith. To avoid unnecessary duplication, the Staff hereby incorporates Part 1 of its Proposed Findings by reference herein.

A. Contention NYS-8 4.2. On November 30, 2007, New York filed a petition to intervene in this matter, raising a number of contentions, including Contention NYS-8, that asserted that [t]he [license renewal application] for IP2 and IP3 violates 10 C.F.R. §§ 54.21(a) and 54.29 because it fails to include an aging management plan for each electrical transformer whose proper function is important for plant safety. 3 2

The Staff utilized a unique number designator for each separate Part of the Proposed Findings, whereby all paragraphs in Part 1 are consecutively numbered 1.__; all paragraphs in Part 2 are consecutively numbered 2.__, etc. Accordingly, all paragraph numbers in this Part commence with the number 4.

3 New York State Notice of Intention to Participate and Petition to Intervene, filed November 30, 2007, at 103-105, ADAMS Accession Nos. ML073400187, ML073400205, and ML073400193.

3 4.3. The Applicant and the Staff opposed admission of Contention NYS-8 on the grounds that the contention raised issues outside the scope of license renewal, was unsupported, and failed to demonstrate a genuine dispute with respect to material issue of law or fact. 4 4.4. On July 31, 2008, the Board issued its Memorandum and Order (Ruling on Petitions to Intervene and Requests for Hearing), in which the Board determined, among other things, that New York had demonstrated standing to intervene in this matter, and that Contention NYS-8 satisfied the Commissions requirements for admission as a contested issue in this proceeding. Entergy Nuclear Operations, Inc. (Indian Point, Units 2 and 3), LBP-08-13, 68 NRC 43, 60, 86-89 (2008).

4.5. In admitting the contention, the Board restated Contention NYS-8 as follows:

NYS Entergy has not proposed an AMP for each electrical transformer in IP2 and IP3 required for compliance with 10 C.F.R. §§ 50.48 and 50.63. This does not include transformer support structures. Id. at 218.

4.6. On August 14, 2009, Entergy moved for summary disposition of Contention NYS-8, arguing that transformers do not require aging management programs and that New Yorks position to the contrary is in conflict with Commission guidance, the regulatory intent of the license renewal regulations, and the long-standing position of the NRC Staff. 5 Citing documents and three expert declarations in support of its position, Entergy pointed out that New York had provided no information or analysis in support of its contention. The Staff expert affidavits in 4

Answer of Entergy Nuclear Operations, Inc. Opposing New York State Notice of Intention to Participate and Petition to Intervene, filed January 22, 2008, at 69-73, ADAMS Accession No. ML080300149; NRC Staffs Response to Petitions for Leave to Intervene Filed by (1) Connecticut Attorney General Richard Blumenthal, (2) Connecticut Residents Opposed to Relicensing of Indian Point, and Nancy Burton, (3)

Hudson River Sloop Clearwater, Inc., (4) The State of New York, (5) Riverkeeper, Inc., (6) The Town of Cortlandt, and (7) Westchester County, filed January 22, 2008, at 44-46, ADAMS Accession No. ML080300014.

5 Applicants Motion for Summary Disposition of New York States Contention 8 (Electrical Transformers)

(Aug. 14, 2009), ADAMS Accession No. ML092330784.

4 support of Entergys motion. 6 New York opposed the motion and submitted a declaration from an expert that asserted that transformers do not change during operation and rely on no moving parts in order to perform their basic function. 7 Faced with what it characterized as a battle of the experts, the Board denied the motion for summary disposition. 8 4.7. In accordance with scheduling Orders issued by the Board on July 1, 2010, October 18, 2011 and February 16, 2012, New York filed its initial testimony and exhibits concerning Contention NYS-8 on December 12, 2011; Entergy and the Staff filed their testimony and exhibits on March 28 and 29, 2012; and New York filed its rebuttal testimony and exhibits on June 29, 2012.

4.8. These proposed findings of fact and conclusions of law present the Boards findings of fact with respect to the evidence presented at the December 13, 2012 hearing concerning Contention NYS-8, and the Boards conclusions of law with respect thereto.

B. Regulatory Background 4.11 The regulatory standards governing license renewal are set forth in Part 1 of the Staffs Proposed Findings, filed simultaneously herewith, and are incorporated by reference herein. In brief, pursuant to 10 C.F.R. § 54.29(a), the Commission may issue a renewed license upon finding that actions have been identified, and have been or will be taken, to manage age-related degradation of structures and components that are within the scope of license renewal pursuant to 10 C.F.R. § 54.4(a) and identified as requiring aging management review (AMR) in 10 C.F.R. § 54.21(a)(1). 10 C.F.R. § 54.29(a).

6 NRC Staffs Answer to Applicants Motion for Summary Disposition of New York Contention 8 (Sept. 14, 2009), ADAMS Accession No. ML092580042.

7 Response of the State of New York to Entergys Summary Disposition Motion and NRC Staffs Supporting Answer (Sept. 23, 2009), ADAMS Accession No. ML092930142.

8 Memorandum and Order (Ruling on Motions for Summary Disposition) (unpublished), slip op. at 7-8 (Nov. 3, 2009), ADAMS Accession No. ML093070521.

5 4.12 The regulation in 10 C.F.R. § 54.4(a) defines plant systems, structures and components (SSCs) within the scope of the license renewal review to include SSCs that are (1) safety-related, (2) non-safety related but whose failure could prevent satisfactory accomplishment of safety functions, or (3) relied on in safety analyses or plant evaluations to perform a function that demonstrates compliance with Commission regulations for, inter alia, fire protection at 10 C.F.R. § 50.48 and station blackout at 10 C.F.R. § 50.63. 10 C.F.R.

§ 54.4(a).

4.13 The regulation in 10 C.F.R. § 54.21(a)(1)(i) provides that, for structures and components within the scope of license renewal, an AMR must be accorded to structures and components that perform an intended function, as described in § 54.4, without moving parts or without a change in configuration or properties. The Commission has determined that a change in configuration or properties should be interpreted to include a change in state. 9 4.14 The regulation in 10 C.F.R. § 54.21(a)(3) requires a license renewal applicant to demonstrate, for structures and components in the scope of license renewal, that the effects of aging will be adequately managed so that the intended function(s) [of those structures and components] will be maintained consistent with the CLB [current licensing basis] for the period of extended operation. 10 C.F.R. § 54.21(a)(3); Entergy Nuclear Generation Co. and Entergy Nuclear Operations, Inc. (Pilgrim Nuclear Power Station), CLI-10-14, 71 NRC 449, 453 (citing the License Renewal SOC, 60 Fed. Reg. at 22,464, Ex. NYS000016).

4.15 In order to demonstrate adequate management of aging effects, license renewal applicants may opt to use AMPs consistent with Commission guidance in NUREG-1801, Generic Aging Lessons Learned (GALL) Report ( GALL Report), Rev. 1, (Sept. 2005) Ex.

NYS000146) or (for recent license renewal applications) GALL Report Rev. 2 (Dec. 2010) (Ex.

9 Statement of Consideration for Final Rule, Nuclear Power Plant License Renewal; Revisions (Ex.

NYS000016), 60 Fed. Reg. 22,461, 22,477 (May 8, 1995) (License Renewal SOC).

6 NYS000147). See NextEra Energy Seabrook, LLC (Seabrook Station, Unit 1), CLI-12-05, __

NRC __ (March 8, 2012) (slip op. at 4, 18).

4.16 Structures and components that perform their intended functions without moving parts or without a change in configuration or properties are commonly referred to as passive. 10 Passive components are subject to performance of an AMR and require AMPs. 10 C.F.R. § 54.21(a); Pilgrim, CLI-10-14, 71 NRC at 454.

4.17 In contrast, active structures and components are those that perform their intended functions with moving parts or changes in configuration or properties. 11 Active components are not subject to performance of an AMR. Accordingly, they do not require AMPs. 12 4.18 The Commission, in the 1995 Statement of Consideration that accompanied the revision of the license renewal rule, discussed the difference between active and passive components at length, giving numerous examples of the two types of components and explaining the rationale for the difference in treatment. The Commission stated that the test for an active component -- that it experiences a change in configuration or properties in performing its intended function should be interpreted to include a change in state. License Renewal SOC, 60 Fed. Reg. at 22477 (NYS000016).

4.19 The key distinction in the Statement of Consideration between active and passive components is the difference between what is needed to provide reasonable assurance that they will be able to perform their intended functions during the period of license renewal. Id. at 22475.

10 The term, passive, does not appear in the regulation in 10 C.F.R. § 54.21. The Commission explained that it coined the term for purposes of convenience and warned that it should not be applied outside of the context of license renewal, License Renewal SOC (Ex. NYS000016), 60 Fed. Reg. at 22,477.

11 License Renewal SOC (Ex. NYS000016), 60 Fed. Reg. at 22,471-72, 22,477.

12 Id.

7 4.20 To determine what is required to provide reasonable assurance of functionality, the Commission examined how performance and condition are addressed under existing programs, 60 Fed. Reg. at 22474, 22484, and sought to identify any additional actions that will be needed to maintain the functionality of the systems, structures, and components in the period of extended operation. Id. at 22464.

4.21 Performance and condition are addressed differently for active and passive components. The Commission noted that while active functions could be verified directly, passive functions are less directly verifiable:

Direct verification of active functions is practical for active function, such as pump flow, valve stroke time, or relay actuation where the parameter of concern (required function), including any design margins, can be directly measured or observed. For passive functions, the relationship between the measurable parameters and the required function is less directly verified.

60 Fed. Reg. at 22471. The Commission determined that where performance and condition is readily monitorable through existing programs, no additional aging management review was required. Id.; see also Seabrook, CLI-12-05, 75 NRC ___ (slip op. at 19). Where, however, performance and condition cannot be as readily monitored, additional consideration, via an aging management review, is needed. 60 Fed. Reg. at 22476, see also Seabrook, CLI-12-05, 75 NRC ___ (slip op. at 20).

4.22 Thus, the Commission determined that for active components, existing programs, including the Maintenance Rule, would be sufficient to monitor performance and condition and enable the licensee to address age-related degradation. 60 Fed. Reg. at 22472. However, the Commission determined that for passive components, those existing programs would not be sufficient and would need to be augmented. 60 Fed. Reg. at 22469. The Commission noted that there is minimal preventive maintenance or monitoring for passive components and, therefore, additional programs are necessary to manage age-related degradation for them. 60 Fed. Reg. at 22470-71. That augmentation takes the form of the aging management review and

8 specific aging management programs. The Commission concluded, an aging management review of the passive functions of structures and components is warranted to provide the reasonable assurance that their intended functions are adequately maintained during the period of extended operations. 60 Fed. Reg. at 22476.

4.23 The regulation in 10 C.F.R. § 54.21(a)(1)(i) contains a non-exclusive list of examples of passive and active components. Electrical transformers are not identified as either passive or active components. See 10 C.F.R. § 54.21(a)(1)(i).

4.24 In its license renewal application, Entergy did not conduct an aging management review or propose an aging management program for electrical transformers at Indian Point. Indian Point Energy Center License Renewal Application (April 2007), Ex. ENT00015A-B.

C. Applicable Legal Standard 4.25 The legal standard for determining whether Entergys license renewal application for Indian Point meets the requirements of 10 C.F.R. § 51.24 is whether electrical transformers perform their intended function by means of a change in configuration, properties, or state such that they require an AMR and an AMP. While this is essentially a factual question, consideration of this issue should properly take into account the regulatory history and the purpose to be served by the regulation. As the Commission has observed, A regulation should be construed to effectuate the intent of the enacting body. Such intent may be ascertained by considering the language used and the overall purpose of the regulation, and by reflecting on the practical effect of the possible interpretations. 13 The regulatory history of the license renewal rule supports the conclusion that electrical transformers should be treated as active 13 Hydro Resources, Inc. (P.O. Box 777, Crownpoint, New Mexico 87313), CLI-06-11, 63 NRC 483, 491, th quoting U.S. v. Christensen, 419 F.2d 1401, 1403-04 (9 Cir. 1969)(internal quotation marks omitted);

see also Long Island Lighting Co.(Shoreham Nuclear Power Station, Unit 1), ALAB-900, 28 NRC 275, 288, review denied, CLI-88-11, 28 NRC 603 (1988) (recourse to regulatory history appropriate to resolve ambiguity in regulatory language).

9 components and that they do not require an aging management review or aging management program.

II. FINDINGS OF FACT A. Witnesses Presented 4.26 An evidentiary hearing on this contention was held on December 13, 2012. A total of seven witnesses appeared on behalf of Entergy, New York, and the Staff, as set forth below. Prefiled testimony and exhibits were submitted by each of these parties. In addition, New York provided rebuttal testimony and exhibits. All of the witnesses also provided oral testimony in response to questioning by the Board and the parties.

4.27 The Applicant presented a panel of four witnesses in support of its license renewal application: John Craig, Dr. Steven Dobbs, Thomas McCaffrey, and Roger Rucker 14.

4.28 Applicant witness John Craig is a senior nuclear safety consultant working for Talisman International, LLC in Washington, DC. He has over 35 years of experience in nuclear energy and nuclear safety matters, including positions with the NRC and in the U.S. Navys nuclear power program. He worked at the NRC from 1976 to 2005. Among his various positions, he served as the Director of the License Renewal and Environmental Project Directorate and was responsible for managing license renewal activities in the NRC Office of Nuclear Reactor Regulation (NRR). In that position, he was directly responsible for managing NRR license renewal activities, including the development and issuance of the initial license renewal rule and regulatory guidance documents for license renewal, including both the safety and environmental aspects of the rule; review of technical license renewal reports submitted by industry groups; and NRR interactions with the first nuclear plants seeking renewal of their operating licenses. In addition, he served as Associate Director for Inspection and Programs, NRR, in which position he was responsible for management of NRC inspection and oversight 14 Testimony of Applicant Witnesses Roger Rucker, Steven Dobbs, John Craig, and Thomas McCaffrey Regarding Contention NYS-8 (Electrical Transformers) (Ex. ENTR00091).

10 activities for all civilian nuclear power reactors and non-power reactors in the United States. In that position, his responsibilities encompassed NRRs license renewal program; next-generation reactor designs/facilities; assessment of environmental issues; standard technical specifications, emergency planning, technical evaluations and assessments of operating reactor events; nuclear plant operator licensing; and licensee quality assurance programs. Mr. Craig holds a Bachelor of Science degree in nuclear engineering from the University of Maryland.

John W. Craig Curriculum Vitae (Ex. ENT000094); Entergy Testimony on NYS-8 (Ex.

ENT000091) at 4-5.

4.29 Applicant witness Dr. Steven Dobbs is a self-employed engineering consultant with Dobbs & Associates Engineering, Inc. in Russellville, Arkansas, and provides engineering consultant services with respect to electronics and computer applications, including their use in nuclear power plants. He has over 35 years of work experience, 16 of which have been in the nuclear power industry. From 1977 to 1990, he worked in the Engineering Department at Arkansas Tech University, teaching classes in electrical machinery that covered the theory and operation of transformers, motors, and generators. From 1990 to 2004, he worked as an electrical engineer at Arkansas Nuclear One and provided engineering support for computer and electronic systems throughout the plant. Since 2004, he has worked principally as an engineering consultant with Dobbs & Associates on matters involving electronics and computer applications. Since January 2007, much of his consulting work has involved electrical and computer systems at nuclear power plants. Steven Dobbs holds a Bachelor of Science degree in physics from Arkansas Tech University, a Master of Science degree in electrophysics from George Washington University, and a Doctor of Philosophy degree in electrical engineering from the University of Arkansas. Steven E. Dobbs Curriculum Vitae (Ex. ENT000093); Entergy Testimony on NYS-8 (Ex. ENT000091) at 3-4.

4.30 Applicant witness Thomas McCaffrey is employed by Entergy as the Design Engineering Manager at Indian Point Energy Center. He is responsible for the design

11 engineering staff that maintains the Indian Point Units 2 and 3 design bases and performs modifications to systems, structures, and components for the facility. He has approximately 20 years of work experience, most of which has been in the nuclear power industry. He worked in Consolidated Edisons Distribution Business before working at Indian Point as an electrical system engineer responsible for the stations medium and high-voltage electrical systems. He was subsequently promoted to Electrical/I&C [Instrumentation and Control] Systems Supervisor and then Systems Manager, and assumed oversight responsibility for numerous engineers involved in all aspects of the Indian Point electrical and instrumentation and control systems.

Prior to taking his current position as Design Engineering Manager, Mr. McCaffrey worked at the Institute of Nuclear Power Operations, where he reviewed nuclear power plant equipment performance. Mr. McCaffrey holds a Bachelor of Engineering degree in electrical engineering from the State University of New York - Maritime College and is a licensed Professional Engineer in the State of New York. Thomas McCaffrey Curriculum Vitae (Ex. ENT000095);

Entergy Testimony on NYS-8 (Ex. ENT000091) at 5-6.

4.31 Applicant witness Roger Rucker is a self-employed engineering consultant with Rucker Nuclear Consultants, Inc. in Russellville, Arkansas. His consulting work focuses on electrical and instrumentation and control applications in nuclear power plants, particularly as they relate to nuclear power plant operating license renewal. He is the License Renewal Electrical Lead for a number of Entergy nuclear power plant license renewal projects, including Entergys project to renew the operating licenses of Indian Point Units 2 and 3. He has over 22 years of work experience, most of which has been in the nuclear power industry. He is a licensed Profession Engineer in the State of Arkansas and is the Entergy representative for the Nuclear Energy Institute (NEI) License Renewal Electrical Working Group. He has been a member of NEI, the Electric Power Research Institute (EPRI), and the Institute of Electrical and Electronics Engineers (IEEE) groups involved with license renewal and aging management activities. In addition, he served as principal investigator in the preparation of

12 EPRIs License Renewal Electrical Handbook. He has served as the electrical lead for nine license renewal applications and as the project manager for one additional license renewal project. Mr. Rucker holds a Bachelor of Science degree in electrical engineering from the University of Arkansas. Ex. ENT000092. Mr. Rucker prepared several documents that support the IP2/IP3 license renewal application (LRA). Those documents include the electrical aging management review report, as well as the electrical portions of the aging management program evaluation report, the scoping and screening report, and operating experience review reports.

He also reviewed the electrical portions of the LRA prior to its submittal and assisted in preparing responses to NRC Staff audit and inspection questions, NRC Staff requests for additional information, and related Entergy amendments to the LRA. He also supported Entergy at the related Advisory Committee on Reactor Safeguards Subcommittee and Full Committee meetings for the Indian Point LRA. Roger Rucker Curriculum Vitae (Ex. ENT000092); Entergy Testimony on NYS-8 (Ex. ENT000091) at 1-3.

4.32 Based on their demonstrated knowledge, skill, experience, and education, we find that Applicants witnesses, John Craig, Dr. Steven Dobbs, Thomas McCaffrey, and Roger Rucker, are qualified to provide expert opinion on the matters addressed in their testimony.

4.33 The Staff presented two witnesses concerning this contention: Roy Mathew and Sheila Ray. 15 4.34 Staff witness Roy Mathew is a Team Leader in the Electrical Engineering Branch in the Division of Engineering in the Office of Nuclear Reactor Regulation (NRR). He served as the principal reviewer of the Staffs treatment of electrical transformers in connection with the Indian Point license renewal review and provided input regarding the Staffs SER in the areas of scoping and screening and aging management of electrical and instrumentation and controls systems. Mr. Mathew provided input for and participated in International Atomic Energy 15 NRC Staffs Testimony of Roy Mathew and Sheila Ray Concerning Contention NYS-8 (Transformers)

(Staff Testimony on NYS-8) (Ex. NRC000031).

13 Agency (IAEA) technical meetings on electric grid reliability and interface with nuclear power plants and the development of an IAEA safety guide for electrical power systems important to safety. He also assisted in the preparation of Information Notice 2009-010, Transformer Failures - Recent Operating Experience (Ex. NYS000019). At the NRC, Mr. Mathew has served, inter alia, as Acting Chief of the Electrical Engineering Branch, Division of Engineering, NRR, which was responsible for reviews of design and operation of offsite power grid systems with regard to interrelationships between the nuclear unit, the utility grid, and interconnecting grids; reviews and evaluations of functional performance requirements, design, and operation of onsite power systems, and the interface between the offsite and onsite power systems under the full range of normal operation, transient and accident conditions; and reviews of environmental qualification of electrical equipment important to safety. Mr. Mathew has over 30 years of experience in the nuclear power industry, including 22 years at the NRC. Mr. Mathew holds a Bachelor of Science degree in electrical engineering from the University of Kerala, India.

Roy Mathew Curriculum Vitae (Ex. NRC000032); Staff Testimony on NYS-8 (Ex. NRC000031) at 1-2.

4.35 Staff witness Sheila Ray is an Electrical Engineer in the Office of Nuclear Regulatory Research (RES) and is the project manager for Confirmatory Research on Equipment Qualification. Previously, she was employed as an Electrical Engineer in the Division of Engineering, NRR; there, she conducted reviews of license renewal applications, specifically focusing on aging management of electrical components, and provided input to scoping and screening portions of the Indian Point SER regarding electrical components. She coordinated the NRCs Extended Proactive Materials Degradation Assessment Project on cables. As part of a group of cable experts, she collaborated with these individuals to develop a matrix of degradation modes for cable insulations and an evaluation of cable degradation mechanisms in regard to the use of cables beyond 60 years. She provided input for and participated in IAEA technical meetings concerning an IAEA Nuclear Series Report on

14 assessing and managing cable aging in nuclear power plants; collaborated with international experts on an IAEA project on polymer aging and cable systems; contributed to the development of the IEEE standard on the seismic testing of relays; and contributed to the Joint International Electrotechnical Commission and IEEE standards on condition monitoring. She has attended training on transformer protection, station blackout, generator protection, and equipment qualification. Ms. Ray holds a Bachelor of Science degree in electrical engineering and a Master of Science degree in electrical engineering, focused on power systems, from the University of Illinois Urbana-Champaign. Sheila Ray Curriculum Vitae (Ex. NRC000033); Staff Testimony on NYS-8 (Ex. NRC000031) at 1-3.

4.36 Based on their demonstrated knowledge, skill, experience, and education, we find that Staffs witnesses, Roy Mathew and Sheila Ray, are qualified to provide expert opinion on the matters addressed in their testimony.

4.37 New York presented one witness, Dr. Robert C. Degeneff. 16 Dr. Degeneff is the owner of Utility Systems Technologies, Inc., a developer of electronic voltage regulators and sag mitigation equipment used for power quality improvement in utility and industrial power systems. Dr. Degeneff taught undergraduate and graduate courses and conducted research at Rensselaer Polytechnic Institute. His major areas of research were transformer design, transient response of electrical equipment, high voltage direct current system (HVDC)

(transformers, electronics, and filters) studies and utility planning studies. He coordinated research on the performance characteristics of HVDC systems. He was responsible for establishing standard practices, which insure design integrity for transformer and reactor insulation structures, short circuit strength, magnetic characteristics and material specifications.

He was also responsible for the development of analytic computer tools necessary to predict the internal electrical behavior of transformers. He designed and developed a group of computer 16 Pre-Filed Written Testimony of Dr. Robert C. Degeneff Regarding Contention NYS-8 (New York Testimony on NYS-8) (Ex. NYSR00003).

15 programs necessary to calculate the internal transient voltage response of power transformers.

Dr. Degeneff has published over 80 papers on topics relating to transformer design and performance and power system design, and he holds eight patents relating to transformer winding design and electronic tap changer design. Dr. Degeneff holds Doctorate and Master of Engineering degrees in electric power engineering from Rensselaer Polytechnic Institute and a Bachelor of Mechanical Engineering from General Motors Institute. He is a registered Professional Engineer in the State of New York. Robert C. Degeneff Curriculum Vitae (Ex.

NYS000004); New York State Testimony on NYS-8 (Ex. NYSR00003) at 1-2.

4.38 Based on his demonstrated knowledge, skill, experience, training, and education, we find that Dr. Degeneff is qualified to provide expert opinion testimony on transformer design and performance.

4.39 However, we afford little weight to Dr. Degeneffs testimony given his lack of demonstrated experience with the operation of the electrical transformers that are within the scope of license renewal pursuant to 10 C.F.R. § 54.4. Parties bear the burden of demonstrating the expert qualifications of their witnesses, which they do by pointing to relevant knowledge, skill, experience, training, or education. Duke Energy Corp. (Catawba Nuclear Station, Units 1 and 2), CLI-04-21, 60 NRC 21, 27-28 (2004). Dr. Degeneff does not have demonstrated experience with the large power transformers that are within the scope of license renewal. Therefore, we give little weight to his testimony on the issue whether such transformers require an aging management review or an aging management program.

4.40 As more fully set forth below, having considered the testimony and other evidence presented by the parties, we find that the evidence supports a conclusion that electrical transformers perform their intended functions through a change in state and, therefore, do not constitute a passive system that would require aging management review or an aging management program pursuant to 10 C.F.R. § 54.21. Accordingly, the Applicants license

16 renewal application is not deficient for failing to provide AMR or an AMP for electrical transformers.

B. Electrical Transformer Operation.

4.41 Witnesses for all of the parties agreed, and we find, that transformers are components that are within the scope of license renewal pursuant to 10 C.F.R. § 54.4. Staff Testimony on NYS-8 (Ex. NRC000031) at 11; Transcript (Tr.) at 4292-93 (Ray); Entergy Testimony on NYS-8 (Ex. ENTR00091) at 25; Tr. at 4295 (Degeneff).

4.42 Witnesses for all of the parties also agreed, and we find, that transformers are long-lived components and are not subject to replacement on a qualified life or specified time period. Staff Testimony on NYS-8 (Ex. NRC000031) at 8; Tr. at 4434 (Rucker); New York Testimony on NYS-8 (Ex. NYSR00003) at 8.

4.43 We further find that transformers are used to step down voltage from a higher to a lower value, step up voltage to a higher value, or provide isolation to a load. Staff Testimony on NYS-8 (Ex. NRC000031) at 12; Tr. at 4351-4355, 4377 (Ray); Entergy Testimony on NYS-8 (Ex. ENT000091) at 29.

4.44 We also find that transformers transform (convert) electrical energy into magnetic energy, and that magnetic energy is then transformed back into electrical energy, usually at a different voltage and current. Staff Testimony on NYS-8 (Ex. NRC000031) at 5-7; Tr. at 4351 (Ray); Tr. at 4355 (Mathew); Entergy Testimony on NYS-8 (Ex. ENTR00091) at 27-28; Tr. at 4335 (Dobbs); New York Testimony on NYS-8 (Ex. NYSR00003) at 7-8.

4.45 Physically, a transformer consists of two or more windings wound around a magnetic core in which the magnetic flux flows. When one of the windings (the primary winding) is connected to an alternating voltage source, an alternating magnetic flux is produced. The amplitude of the magnetic flux depends on the primary voltage and number of turns in the windings. A varying current in the primary winding creates a varying magnetic flux in the

17 transformer's core (the iron core on which both windings are wound) and thus a varying magnetic field through the secondary winding. This varying magnetic field induces a varying electromotive force, or "voltage", in the secondary winding. The quantitative value of the induced voltage depends on the number of turns in the secondary winding. Staff Testimony on NYS-8 (Ex. NRC000031) at 7; Tr. at 4351 (Ray); Tr. at 4355 (Mathew); Entergy Testimony on NYS-8 (Ex. ENTR00091) at 26-29; Tr. at 4335-57 (Dobbs); New York Testimony on NYS-8 (Ex.

NYSR00003) at 7-8.

4.46 Witnesses for the Staff and Entergy testified that, as transformers operate and perform their intended function, there is a change in the magnetic flux within the transformer core. Staff Testimony on NYS-8 (Ex. NRC000031) at 6, 11-12; Tr. at 4354 (Ray); Tr. at 4354-55 (Mathew); Entergy Testimony on NYS-8 *Ex. ENTR00091) at 33-36; Tr. at 4335-36 (Dobbs).

4.47 The Staffs witnesses testified that the change in the magnetic flux that occurs in a transformer is a change in the state of a transformer. They explained that a transformer changes its state by transforming electrical energy into magnetic energy, then back into electrical energy again. Because its operation depends on electromagnetic induction between two stationary coils and a magnetic flux of changing magnitude and polarity, a transformer is, according to the Staff, an active alternating current device. Staff Testimony on NYS-8 (Ex.

NRC000031) 6, 11; Tr. at 4355 (Mathew). Furthermore, the Staff explained that when transformers transfer energy from one or more circuits to other circuits at the same frequency, they usually do so with changed values of voltage and current. Staff Testimony on NYS-8 (Ex.

NRC000031) at 7.

4.48 Entergys witnesses also testified that the change in the magnetic flux in a transformer constitutes a change in the properties of a transformer. Entergy Testimony on NYS-8 (Ex. ENTR00091) at 30-37; Tr. at 4225 (Craig), 4329-30 (Dobbs).

4.49 The Staff and Applicant witnesses testified that the change in transformers magnetic flux constitutes a change that qualifies transformers as active components, such that

18 they do not require an AMR. Staff Testimony on NYS-8 (Ex. NRC000031) at 6, 11, 12, 22; Tr.

at 4354, 437-77 (Ray), Tr. at 4355 (Mathew); Entergy Testimony on NYS-8 (ENTR000091) at 10-11, 55; Tr. at 4335-37 (Dobbs). .

4.50 In contrast, New York witness Dr. Degeneff testified that the change in magnetic flux is a property of the electricity that flows through a transformer, like water flows through a pipe, and is not a change in the property or state of the transformer itself. New York Testimony on NYS-8 (Ex. NYSR00003) at 12-14, 18-19; Tr. at 4339-42. He further testified that the change occurs in the electrical power being transformed by the transformer, not in the transformer itself. New York Testimony on NYS-8 (Ex. NYSR00003) at 10, 12-14; Rebuttal Testimony of Dr. Robert C. Degeneff, D. Eng. Regarding Contention NYS-8 (Ex. NYS000414)

(New York Rebuttal Testimony on NYS-8) at 11-17. Dr. Degeneff testified that because, in his view, the transformer does not experience a change in property or state, it is a passive device, such that an AMR is required. New York Testimony on NYS-8 (Ex. NYSR00003) at 11-14; New York Rebuttal Testimony on NYS-8 (Ex. NYS000414) at 4-5.

4.51 Staff Witness Sheila Ray rebutted New Yorks theory that it is the electricity that changes state as it flows through the transformer. She explained that, contrary to New Yorks theory, electricity does not flow through a transformer like water flows through a pipe. Ms. Ray stated that, in a pipe, the water that exits a transformer is the same water that enters it. Tr. at 4351. In contrast, Ms. Ray stated that this is not the case with electricity; rather, electricity flows into a transformer and is then converted into magnetic energy and that magnetic energy induces new electricity, which is what exits the transformer. Id. at 4352. She testified that the electricity exiting a transformer is not the same electricity that enters it. Tr. at 4351-52, 4377; see also Tr.

at 4356-57 (Mathew); Tr. at 4457-58 (Dobbs).

4.52 In addition, Staff witnesses Ms. Ray and Mr. Mathew explained that the primary and secondary circuits in a transformer are two separate circuits and are not connected. Tr. at 4351-52, 4377 (Ray), and 4356-57 (Mathew). They explained that because the two circuits are

19 not connected and because there is a break between them, they do not constitute an unbroken conduit such as a pipe. Tr. at 4351-52 (Ray), 4356-57 (Mathew). They further testified that the change in state that occurs during transformer operation occurs in the transformer, specifically in the magnetic field in between the two circuits. Tr. at 4354, 4376-77, 4384 (Ray), Tr. at 4354-55 (Mathew); Tr. at 4225 (Craig); 4335-37 (Dobbs). Because the change in property or state occurs in a transformer, a transformer is an active component.

4.53 Similarly, Entergys witness, Dr. Steven Dobbs, testified that New Yorks witness was incorrect when he asserted that the change in voltage and current took place in the electricity associated with transformer operation. Dr. Dobbs explained that voltage and current are not properties of electricity. Entergy Testimony on NYS-8 (ENTR00091) at 33, 60-65. He explained that voltage and current only exist when electricity is acted upon by an external force, and he then explained how a transformer operates as that external force. Id. at 33, 60-61. He testified that, according to New Yorks witnesss own theory, this establishes that voltage and current are properties of the transformer and are not properties of the electricity associated with transformer operation. Id. at 62-64. Thus, he concluded, the change in properties occurs in the transformer, not in the electricity. Id. at 33-36, 60.

4.54 Based on the testimony and evidence presented in this matter, we find that transformers operate via a change in state in their magnetic field. We find that the weight of the evidence supports a finding that the change in state is a change in transformer itself, rather than in the electricity flowing through it. As discussed further below in the section that addresses Pipes, we reject Dr. Degeneffs analogy between a pipe and a transformer.

C. Monitorability of Transformer Performance and Condition 4.55 As discussed above, the monitorability of a components performance and condition is a key consideration in determining whether an AMR and/or AMP is needed for license renewal. In this regard, the Staffs witnesses testified that degraded performance and

20 condition of transformers is readily and directly monitorable, and that this attribute of transformers supports the Staffs position that transformers are active components. Staff Testimony on NYS-8 (Ex. NRC000031) at 11-13; Tr. at 4409-12 (Mathew).

4.56 The Staff witnesses explained that degraded performance would be revealed by a change in the electrical performance of the transformer and the associated circuits. Staff Testimony on NYS-8 (Ex. NRC000031) at 17. Mr. Mathew also testified that transformers have protective devices that will signal an alarm if there is a fault or arcing inside the transformer. Tr.

at 4410-12.

4.57 The Staffs witnesses also stated that degraded performance of transformers will be revealed through the surveillance, monitoring, and maintenance required by 10 C.F.R.

§ 50.65, Requirements for Monitoring the Effectiveness of Maintenance at Nuclear Power Plants, and other Part 50 regulatory requirements. Staff Testimony on NYS-8 (Ex.

NRC000031) at 11-12, 14, 18-20. The Staff explained that transformers input and output voltage and current as well as power output, temperature, pressure and vacuum readings, and oil temperature can be monitored. Id. at 15-16; Tr. at 4410-13. In addition, the Staffs witnesses stated that the trending of electrical parameters measured during transformer surveillance and maintenance provides a direct indication of the transformers performance. Staff Testimony on NYS-8 (Ex. NRC000031) at 15-16; Tr. at 4250 (Mathew).

4.58 The Staff also cited long-standing Staff guidance, issued in 1997,17 indicating that trending electrical parameters measured during transformer surveillance and maintenance such as Doble test results, advanced monitoring methods such as infrared thermography, and electrical circuit characterization and diagnosis provide direct indication of the performance of transformers. Staff Testimony on NYS-8 (Ex. NRC000031) at 13-15, 16.

17 Letter from C. Grimes (NRC/NRR) to D. Walters (NEI), dated September 19, 1997, re Determination of Aging Management Review for Electrical Components (Ex. ENT000097) (Grimes Letter).

21 4.59 In that 1997 guidance, the Staff determined that degradation in transformers ability to perform their intended function was readily monitorable. Grimes Letter (Ex.

ENT000097) at 2; Staff Testimony on NYS-8 (Ex. NRC000031) at 13-14.

4.60 In developing the 1997 guidance, the Staff examined techniques available for performance or condition monitoring of the active electrical components identified in the regulation in 10 C.F.R. § 54.21. Based on its examination of testing, maintenance and surveillance programs available for the active electrical components listed in the regulation, and those available for transformers, the Staff explicitly concluded, Any degradation of the transformers ability to perform its intended function is readily monitorable by a change in the electrical performance of the transformer and the associated circuits. Grimes Letter (Ex.

ENT000097) at 2.

4.61 Consistent with this guidance, the Standard Review Plan for Review of License Renewal Applications for Nuclear Power Plants (NUREG -1800) (NYS000161) at 2.1-26, classifies transformers as components for which no aging management review is required. Tr.

4360-62 (Ray).

4.62 The Staffs witnesses testified that gross failure of a power transformer is typically monitored by various indications and alarms in the control room. 18 Staff Testimony on NYS-8 (Ex. NRC000031) at 15; Tr. at 4410-11 (Mathew). Moreover, they observed that the incidents of transformer failure that New Yorks witness cited in the report that accompanied his testimony, Report of Dr. Robert C. Degeneff in Support of Contention NYS-8 (Ex. NYSR00005) 18 In response to inquiry from the Board, witnesses for the Staff and Entergy acknowledged that the ability to detect gross failure of transformers was not the goal of the license renewal process. Tr. at 4235-36 (Craig) and 4243, 4314-15 (Ray). Rather, as the Statement of Consideration explained, whether or not the gross failure of a component could be readily determined is one of the means for differentiating between active and passive components. License Renewal SOC (Ex. NYS000016), 60 Fed. Reg. at 22471. In this regard, the Commission pointed out that failure of an active component can be directly observed, while failure of a passive component is less directly determined. Direct verification is practical for active function such as pump flow, valve stroke time, or relay actuation where the parameter of concern (required function), including any design margins can be directly measured or observed. For passive functions, the relationship between the measurable parameters and the required function is less directly verified. Passive functions, such as pressure boundary and structural integrity are generally verified indirectly, by a confirmation of physical dimensions or component physical condition(.) Id.

22 (Degeneff Report)at 18-21, include several examples of transformer failures that were immediately and readily apparent. Staff Testimony on NYS-8 (Ex. NRC000031) at 24-25.

4.63 Finally, the Staffs witnesses testified that age-related degradation in the condition of transformers is also readily and directly monitorable. Staff Testimony on NYS-8 (Ex. NRC000031) at 11-13, 14-20. For example, the Staff indicated that an analysis of gases dissolved in transformer oil is one way to monitor degradation of a transformers condition. Id.

at 16. In addition, they stated that infrared thermography can be used to depict thermal variations in a transformer that may indicate problems. Id. Further the Staff listed various maintenance procedures that can be used to correct the detrimental effects of aging on electrical transformers, such as: visual inspections, operational checks on auxiliary devices, examination and testing for oil and nitrogen leaks, insulation resistance tests, turns ratio tests, insulating liquid testing, oil analysis, insulating power factor tests (i.e., Doble tests), insulation oil filtration tests, load tap changer tests, and low voltage excitation tests. Id. at 17; Tr. at 4267-69, 4275 (Ray); Tr. at 4410-11 (Mathew).

4.64 Research on transformers is consistent with the Staffs testimony. The Idaho National Engineering Laboratory examined aging effects on transformers and found no transformer aging mechanisms that would cause a safety concern. If nuclear plants use currently recognized monitoring and testing methods and follow a rigorous surveillance, testing, maintenance, and replacement program (based on current and future manufacturers and industry guidelines) the effects of transformer aging will not increase the risk to nuclear plant safety. Aging of Safety Class 1E Transformers in Safety Systems of Nuclear Power Plants, NUREG/CR-5753, INEL-95/0573 (Ex. NYS000012) at p. ix.

4.65 Entergys witnesses catalogued and discussed in detail the performance monitoring and preventive maintenance programs that Entergy employs at Indian Point.

Entergy Testimony on NYS-8 (Ex. ENTR00091) at 96-104; Tr. at 4251-56, 4259-61, 4269-71, 4307-12 (McCaffrey).

23 4.66 Entergy witness Mr. McCaffrey testified that Indian Point plant personnel can monitor transformer voltage and current in the control room, and that there are alarms that will alert plant personnel of degradation in the performance of transformers. Tr. at 4270-71 (McCaffrey).

4.67 Further, Entergys witnesses testified that Entergy employs the following techniques for transformer condition and performance monitoring: power factor, capacitance, hot collar (for bushings), excitation current, leakage reactance, transformer turns ratio, winding resistance, corona scan, winding insulation resistance, sweep frequency response analysis, oil dissolved gas analysis, oil quality, furanic compound analysis in oil, visual inspections/cleaning, and thermography. Entergy Testimony on NYS-8 (Ex. ENT000091) at 96-98, Tr. at 4253-56 (McCaffrey). The witnesses stated that the results of these tests and programs are monitored and trended to identify degrading conditions and to develop a life-cycle management plan that specifically addresses Indian Point transformers. Entergy Testimony on NYS-8 (Ex.

ENTR00091) at 97-98; Tr. at 4255, 4259-61 (McCaffrey); see also Tr. at 4269 (Ray).

4.68 New Yorks witness also testified about the tests that can be used to monitor the condition of transformers, thus acknowledging that transformers can be monitored for condition.

He testified that a prudent owner would measure, monitor the condition of the transformer at the beginning of its life and certainly towards the end of its life. Tr. at 4440 (Degeneff). He also testified about taking power factor or capacitance measurements on transformer bushings and trending those results. Id. at 4263-64. He further stated that internal arching is detectable through oil and gas measurements. Id. at 4278-80. Also, he acknowledged that the Doble test can be used to determine whether the structure of the winding in a transformer has changed over time. Id. at 4380-81. Thus, Dr. Degeneff plainly recognized that transformers can be monitored for condition.

4.69 Notwithstanding these concessions, Dr. Degeneff asserted that transformers were not readily monitorable because many of the tests needed to establish transformer

24 condition and performance can only be done when a transformer is de-energized and taken off-line or drained. New York Testimony on NYS-8 (Ex. NYSR00003) at 34; New York Rebuttal Testimony on NYS-8 (Ex. NYS000414) at 39-40, 42-43; Tr. at 4264.

4.70 However, witnesses for Entergy and the Staff testified that many of these tests can be and are conducted while transformers are operating or on-line. Entergy Testimony on NYS-8 (Ex. ENTR00091) at 40, 100-104; Tr. at 4251-54, 4269, 4280 (McCaffrey); Tr. at 4250-51 (Mathew).

4.71 After hearing testimony from the witnesses for Entergy and the Staff that many of these tests can be conducted on-line, Dr. Degeneff retreated from his previous position, stating that the suite of measurements that theyre making, the measurements are fine. The frequency is whats of concern. Tr. at 4282 (emphasis added). When asked whether his main area of concern in addition to the fact that there is not an aging management program for transformers is that its the frequency of the testing and the monitoring thats being performed, Dr. Degeneff stated that his major concern was with the frequency of the monitoring, as opposed to the ability to monitor performance and condition. Tr. at 4296-97. Dr. Degeneff did not, however, state what frequency of monitoring would be sufficient in his view to establish reasonable assurance that a transformer would be able to function during the license renewal period of extended operation. Similarly, although he opined that an aging management program could be crafted that improved on the maintenance rule, he did not identify what those improvements would be. Tr. at 4296.

4.72 Staff witness Roy Mathew observed that even if an aging management program had been in place for transformers, such a program would not have provided a guarantee against failure. Tr. at 4250. Indeed, the Entergy and Staff witnesses testified that transformers can fail for many reasons unrelated to age-related degradation, including design defects, manufacturing defects, and lightning strikes, none of which are the result of aging. Tr. at 4250 (Mathew); Tr. at 4264 (McCaffrey).

25 4.73 Dr. Degeneff acknowledged that the purpose of the license renewal rule was not to preclude all failures, but to provide reasonable assurance against failure, New York Rebuttal Testimony on NYS-8 (NYS000414) at 37. Nonetheless, he cited various reports of transformer failures, including transformer failures at Indian Point, and argued that those reports evidenced the difficulty in monitoring the condition of transformers and predicting whether and how long they would function properly. New York Testimony on NYS-8 (Ex. NYSR00003) at 38-41, Degeneff Report (Ex. NYSR00005) at 17-22; Rebuttal Testimony on NYS-8 (Ex. NYS000414) at 43-45; Tr. at 4298-99, 4382, 4391.

4.74 The Staff and Entergy provided a different view of the transformer failures that have occurred. Entergys witness, Mr. McCaffrey, stated that in February 2012, Entergy had replaced a transformer at Indian Point prior to failure based on results of condition monitoring.

Tr. at 4255-56. He also testified that in 2006, two transformers at Indian Point were replaced due to age-related degradation. Tr. at 4259.

4.75 Entergys witness cited the 2007 failure of the Indian Point Unit 3 main transformer as a failure whose most probable cause was a design flaw. Entergy Testimony on NYS-8 (Ex. ENTR00091) at 105; Tr. at 4300-01 (McCaffrey). He also stated that analysis of the 2010 failure of the Indian Point Unit 2 main transformer concluded that the failure was due to a design/manufacturing weakness in the transformer bushing. Entergy Testimony on NYS-8 (Ex.

ENTR00091) at 106; Root Cause Evaluation Report, IP2 Turbine Trip/Reactor Trip Due to Main Transformer Fault (Ex. ENT000130A) at 11; Tr. at 4301 (McCaffrey).

4.76 Inasmuch as these transformer failures were not the result of age-related degradation, they do not constitute evidence of the inability of current inspection, surveillance, monitoring, and maintenance programs to manage aging of transformers.

4.77 Furthermore, Staff witness, Roy Mathew, testified that these Indian Point transformer failures and the failures of transformers at other plants cited by New Yorks

26 witness 19 involved failures of transformers that were not within the scope of license renewal. Tr.

at 4265-66. He explained that main transformers step power up from the plant and transmit that power to the grid and that, as such, they do not have license renewal functions. Tr. at 4301-02; see also Tr. at 4303 (McCaffrey). In contrast, Mr. Mathew stated that transformers that are within the scope of license renewal are lightly loaded and include transformers needed for recovery from station blackout. Tr. at 4265-55, 4304-05. He testified that these transformers are station auxiliary transformers that step down power and that they are therefore subject to lesser degradation than main transformers that step up power. Id.

4.78 According to Entergys witness, Thomas McCaffrey, these station auxiliary transformers are subject to the same maintenance and testing as the larger step-up, or main, transformers. Id. at 4303.

4.79 Dr. Degeneff provided his opinion that transformers that are not used frequently require an active program to ensure their health, id. at 4443, but he did not identify any deficiency in existing regulatory programs used to monitor transformer condition or 20 performance.

4.80 Having considered the evidence presented by the parties, we find that the incidents of transformer failure cited by New Yorks witness do not support the claim that an aging management review and/or aging management programs are needed for transformers that are within the scope of license renewal. Rather, we find that existing inspection, 19 New York Testimony on NYS-8 (Ex. NYS000003) at 38-41; NRC Information Notice 2009-10, Transformer Failures - Recent Operating Experience (Ex. NYS000019).

20 In the Statement of Consideration that accompanied the 1995 revision of the license renewal regulations, the Commission addressed a comment that raised a similar issue regarding active components (valves) that are rarely operated during the life of the plant and relied upon as part of contingency actions to address plant emergencies. The Commission disagreed with the commenter that there was insufficient evidence that the active functions of such components would be maintained during the period of extended operations, noting that these components would be subject to existing regulatory programs. The Commission concluded that the ability of such components to continue to function would be assured through preventive maintenance and performance or condition monitoring via existing regulatory programs. License Renewal SOC (Ex. NYS000016), 60 Fed. Reg. at 22472.

27 surveillance and maintenance programs can be relied upon to provide reasonable assurance that age-related degradation in the condition and performance of transformers within the scope of license renewal will be identified and addressed without the need for an aging management review or aging management programs. See Staff Testimony on NYS-8 (Ex. NRC000031) at 11-13; Tr. at 4223-24 (Craig).

D. Comparison of Transformers to Active and Passive Components Listed in 10 C.F.R. § 54.21(a)(1) 4.81 In its July 31, 2008 Memorandum and Order on contention admissibility, the Board instructed the parties to explain whether and how transformers were similar to the included (passive) or the excluded (active) components listed in 10 C.F.R. § 54.21(a)(1)(i).

Indian Point, LBP-08-13, 68 NRC at 89.

4.82 The regulation in 10 C.F.R. § 54.21 provides the following non-exclusive list of active electrical system components: transistors, batteries, breakers, relays, switches, power inverters, circuit boards, battery chargers, and power supplies. The regulation also provides a non-exclusive list of the following passive electrical system components that would require an AMR: electrical cables and connections, cable trays, and electrical cabinets.

1. Active Components 4.83 Based on the evidence and testimony discussed below, we find that transformers are similar to transistors, batteries, battery chargers, power inverters, power supplies, circuit boards, and circuit breakers, (all components identified in the regulation in 10 C.F.R. § 54.21 as not requiring aging management review), because all of these components perform their intended functions through a change in state or property and their performance and/or condition is directly and/or readily monitorable. We further find that the use of an external control mechanism is irrelevant to the question whether a component is active or passive.

28 Transistors 4.84 Witnesses for the Staff testified that transformers are similar to transistors. To operate, both components undergo a change of state but do so with no moving parts and without a chemical change. In addition, transistors output is easily monitored and in this way, transistors are similar to transformers. Both transistors and transformers are long-lived components. Degradation of the ability of both transistors and transformers to perform their intended functions is readily detectable and in many instances will trigger plant alarms. Staff Testimony on NYS-8 (Ex. NRC000031) at 20-21.

4.85 Entergys witnesses testified that transformers are similar to transistors in that they perform their intended function by using internal electric fields that change with external bias, the input signal, or the load demands. Entergy Testimony on NYS-8 (Ex. ENTR00091) at 73-75. Entergys witnesses further stated that the changing resistivity of transistors is similar to the change in magnetic flux of transformers: both are observed at the electric terminals of the devices. Entergy Testimony on NYS-8 (Ex. ENTR00091) at 74-75; Tr. at 4337, 4431 (Dobbs).

4.86 New Yorks witness disagreed, stating that transistors experience a change in properties or state when they operate. New York Testimony on NYS-8 (Ex. NYSR00003) at 21-26; New York Rebuttal Testimony on NYS-8 (Ex. NYS000414) at 20, 28-30; Degeneff Report (Ex. NYSR00005) at 8. Further, Dr. Degeneff asserted that, in contrast, transformers do not experience a change in properties or state. New York Testimony on NYS-8 (Ex. NYSR000003) at 21, 23. In addition, he argued that a transistor cannot operate without the application of a control voltage, whereas a transformer operates independent of applied power. New York Rebuttal Testimony on NYS-8 (Ex. NYS000414) at 21-23; Degeneff Report (Ex. NYSR00005) at 9-10; Tr. at 4388, 4432.

4.87 Dr. Degeneff did not rebut the Staff and Entergy testimony that both transistors and transformers are directly and readily monitored for performance and condition and, therefore, are active components. In fact, in his oral testimony, he identified several means of

29 monitoring transformer condition and acknowledged (as noted above) that his primary concern was with the frequency of monitoring, rather than whether monitoring was possible. Tr. at 4263-64, 4278-81.

4.88 Witnesses for the Staff and Entergy rejected Dr. Degeneffs assertion that the existence of an external control mechanism is relevant to the question whether a component is active or passive. They testified that whether or not a component had an external control mechanism is not dispositive of the question whether the component experiences a change in properties or state. Staff Testimony on NYS-8 (Ex. NRC000031) at 23-24; Entergy Testimony on NYS-8 (Ex. ENTR00091) at 77-78.

Batteries 4.89 The Staff testified that transformers are similar to batteries in that both batteries and transformers can be readily monitored for performance. The Staff noted that both devices operate by means of a change in state, without moving parts. The Staff observed that when a battery is working, the electrolyte properties change during discharge but the change cannot be seen. They compared this to transformers, which operate via magnetic flux changes, which also cannot be seen. The Staff stated that when a battery is operating, a chemical reaction is taking place and output voltage and current can be measured. Similarly, they pointed out, when a transformer is working, a change in the magnetic flux is taking place and as a result, output voltage and current can be measured. Thus, both devices are readily monitorable. Staff Testimony on NYS-8 (Ex. NRC000031) at 20.

4.90 Entergys witness also testified that batteries experience a change in property or state and a change in their terminal voltage. Entergy Testimony on NYS-8 (Ex. ENTR00091) at

81. In addition, Dr. Dobbs testified that that chemical change and the proper operation of a battery can be directly monitored at the batterys external terminal. Tr. 4389-90.

30 4.91 New Yorks witness, Dr. Degeneff, agreed that when a battery operates, it changes state. New York Testimony on NYS-8 (Ex. NYSR00003) at 26; New York Rebuttal Testimony on NYS-8 (Ex. NYS000414) at 9-10, 30; Tr. at 4385. He argued that a battery is different than a transformer, however, because a battery that has been discharged will have different properties than a battery that has not been discharged, whereas, he asserts, a transformer is not changed as a result of its operation. New York Testimony on NYS-8 (Ex.

NYSR00003) at 26; New York Rebuttal Testimony on NYS-8 (Ex. NYS000414) at 30; Degeneff Report (Ex. NYSR00005) at 13.

4.92 Dr. Degeneff did not rebut the Staffs and Entergys assertion that batteries and transformers both are directly and readily monitored for performance -- a key factor in determining that a component should be classified as an active component and therefore is excluded from the license renewal rule. In fact, in his oral testimony, he identified several means of monitoring transformer condition and acknowledged that his primary concern was with the frequency of monitoring, rather than whether monitoring was possible. Tr. at 4263-64, 4278-81.

4.93 The Staff and Entergy witnesses testimony, rejecting the notion that the use of external controls on transistors renders them active components, applies equally to batteries.

Staff Testimony on NYS-8 (Ex. NRC000031) at 23-24; Entergy Testimony on NYS-8 (Ex.

ENTR00091) at 77-78.

Battery Chargers 4.94 The Staffs witnesses testified that transformers are similar to battery chargers.

Both operate without moving parts and both perform their intended function via a change in state, specifically, an electrical conversion that cannot be seen. The conversion process in a battery charger and the performance of a transformer can be measured and the performance of

31 both devices can be readily monitored. Staff Testimony on NYS-8 (Ex. NRC000031) at 12, 21, Tr. 4461.

4.95 Entergys witnesses also testified that battery chargers operate without moving parts and that the change in a battery chargers terminal voltage and current can be readily monitored. Entergy Testimony on NYS-8 (Ex. ENTR00091) at 39, 42; Tr. at 4396 (Dobbs).

4.96 For his part, New Yorks witness testified that battery chargers are active components because they include mechanisms to control the relationship between input and output. New York Testimony on NYS-8 (Ex. NYSR00003) at 28; Tr. at 4408 (Degeneff).

4.97 Further, Dr. Degeneff testified that since battery chargers change state from conductors to insulators, they are active components. New York Rebuttal Testimony on NYS-8 (Ex. NYS000414) at 31-32.

4.98 Dr. Degeneffs view was effectively rebutted by the Staff and Entergy. The Staffs witnesses testified that the fact that battery chargers have external mechanisms to control the relationship between input and output is not relevant to the determination whether a component is passive or whether it requires aging management. Staff Testimony on NYS-8 (Ex. NRC000031) at 23. Furthermore, the Staff witnesses stated that some transformers, specifically autotransformers, do have external control mechanisms. Id. at 23-24. Thus, under Dr. Degeneffs theory -- that external control mechanisms identify active components --

autotransformers would be active components.

4.99 Entergys witness, Dr. Dobbs, also testified that whether or not a component had an external control mechanism was irrelevant to the determination whether that component was active or passive. Entergy Testimony on NYS-8 (Ex. ENTR000091) at 78. Dr. Dobbs also refuted Dr. Degeneffs claim that the inclusion of solid state devices was a necessary characteristic of an active component. Entergy Testimony on NYS-8 (Ex. ENTR00091) at 83-86.

32 4.100 Significantly, Dr. Degeneff did not rebut the argument by the Staff and Entergy that battery chargers and transformers both are directly and readily monitored for performance and, therefore, are active components.

Power Inverters, Power Supplies, Circuit Boards, and Circuit Breakers 4.101 The Staff testified that transformers are similar to power inverters, power supplies, circuit breakers, relays and switches because (a) all of these components perform their intended functions through a change in state, (b) their performance can be easily monitored for performance, (c) gross failure of these components is readily detectable during plant operation, and (d) they are covered by existing monitoring and maintenance procedures and thus do not require aging management. Staff Testimony on NYS-8 (Ex. NRC000031) at 12-13, 23-24. Ms. Ray also testified that, like transformers, the internal wirings in circuit boards and inverters do not move during operation. Tr. at 4461-62.

4.102 Entergys witnesses testified that power inverters, power supplies and circuit boards operate without moving parts. Entergy Testimony on NYS-8 (Ex ENTR00091) at 39.

They stated that power inverters, power supplies, circuit breakers, and circuit boards are active components because their performance can be directly measured, observed, and monitored.

Id. at 11, 39, 42; Tr. at 4395-96 (Dobbs).

4.103 New Yorks witness asserted that power inverters, power supplies, and circuit breakers have mechanisms to control the relationship between input and output and this reliance on external controls renders them active devices. New York Testimony on NYS-8 (Ex.

NYSR00003) at 26-28; Degeneff Report (Ex. NYSR00005) at 13; Tr. at 4386-87.

4.104 Witnesses for the Staff and Entergy rebutted Dr. Degeneffs claim that the reliance of these components on external control mechanisms rendered them active components. Staff Testimony on NYS-8 (Ex. NRC000091) at 23-24; Entergy Testimony on NYS-8 (Ex. ENTR00091) at 78.

33 4.105 Dr. Degeneff did not address testimony by the Staff and Entergy witnesses that power inverters, power supplies, circuit boards and circuit breakers can be readily monitored for performance. It is this characteristic of ready monitorability, however, that is shared by transformers and power inverters, power supplies, circuit boards and circuit breakers, which the witnesses for the Staff and for Entergy cite as a key basis for classifying transformers as active components.

2. Passive Components 4.106 Based on the testimony and evidence discussed below, we find that transformers are dissimilar to the passive components (pipes, cables, reactor pressure vessel, containment, and steam generator) identified in the regulation in 10 C.F.R. § 54.21 as requiring aging management review. Our finding is supported by testimony and evidence that these passive components perform their intended functions without a change in state or property and their performance and condition are not readily or directly monitorable. Because transformers perform their intended function through a change in state and because they are readily and directly monitorable for performance and condition, they are not like the passive components identified in the regulation as requiring aging management review. We also find that pipes serve as conduits for water and that transformers do not serve as conduits for electricity and for this additional reason, pipes and transformers are dissimilar.

Pipes 4.107 The Staffs witnesses testified that transformers are not like pipes because pipes serve as conduits (for fluid) while transformers do not serve as conduits (for electricity). Staff Testimony on NYS-8 (Ex. NRC000031) at 22. Also, the Staff witnesses testified that age-related degradation is not readily or directly monitorable in pipes while age-related degradation is readily and directly monitorable in transformers. Staff Testimony on NYS-8 (Ex. NRC000031) at 11-12, 22, Tr. at 4378-79 (Ray), 4409-12 (Mathew).

34 4.108 Testimony from Entergys witness, Steven Dobbs, was consistent with testimony from the Staff. Dr. Dobbs testified that a change in the condition of a pipe is measured indirectly, as opposed to the condition of a transformer, which can be measured directly.

Entergy Testimony on NYS-8 (Ex. ENTR00091) at 42. Further, he pointed out that piping performs a passive (pressure boundary) function, whereas transformers do not perform a passive function. Entergy Testimony on NYS-8 (Ex. ENTR00091) at 72, Tr. at 4405-06.

4.109 New Yorks witness testified that a transformer is like a pipe because both are conduits; he asserts that power flows through a transformer just as water flows through a pipe.

New York Testimony on NYS-8 (Ex. NYSR00003) at 18-19; Degeneff Report (Ex. NYSR00005) at 7; Tr. at 4343. Dr. Degeneff asserts that transformers and pipes do not experience a change in their properties as they function, but rather the power and the water that flow through them experience changes in their properties. New York Testimony on NYS-8 (Ex. NYSR00003) at 18-19; New York Rebuttal Testimony on NYS-8 (Ex. NYS000414) at 10-11, 24-26; Degeneff Report (Ex. NYSR00005) at 7. He gives an example of water flowing through a constriction in a pipe and argues that this results in a change in the properties of the water, not a change in the properties of the pipe. New York Testimony on NYS-8 (Ex. NYSR00003) at 18-19; New York Rebuttal Testimony on NYS-8 (Ex. NYS000414) at 24-27; Tr. at 4343. Similarly, he argues that it is the power that flows through a transformer that experiences a change in its properties and asserts that the transformer experiences no change in its configuration, property, or state.

New York Testimony on NYS-8 (Ex. NYSR00003) at 18-19.

4.110 Ms. Ray rebutted Dr. Degeneffs pipe analogy, testifying that a pipe is viewed as a conduit because the water coming out of the pipe is the same water that entered the pipe. Tr.

at 4378-79 (Ray). In contrast, she stated, the electricity leaving the transformer is not the same electricity that entered it. Tr. at 4351-52, 4377. She and Mr. Mathew explained that there is no connection between the primary circuit and the secondary circuit in a transformer; rather, the two circuits are electrically-isolated circuits, connected by a magnetic field. Staff Testimony on

35 NYS-8 (Ex. NRC000031) at 5; Tr. at 4356 (Mathew), 4377 (Ray). The electrical energy at the primary circuit is transformed into magnetic energy in the transformer core, and that magnetic energy is transformed into different electrical energy at the secondary circuit. Staff Testimony on NYS-8 (Ex. NRC000031) at 11, 22; Tr. at 4351-52 (Ray). Because electricity does not flow through a transformer like water flows through a pipe, NRC witness Roy Mathew, stated that it was inappropriate to attempt to analogize the two. Tr. at 4356.

4.111 Entergys witness, Dr. Dobbs, also rejected Dr. Degeneffs pipe analogy. Dr.

Dobbs testified that the water that flows out of a pipe is the same water that flows in; in contrast, the current that flows out of a transformers is new current created by the transformers magnetic field and it contains no part of the current that flowed in. Entergy Testimony on NYS-8 (Ex. ENTR00091) at 71; Tr. at 4367-70, 4457-58. He also testified that a pipe does not change as it performs its intended function, whereas a transformer experiences a change in its magnetic flux when it performs its intended function. Entergy Testimony on NYS-8 (Ex. ENTR00091) at 71.

4.112 Dr. Dobbs also rebutted Dr. Degeneffs assertion that a constriction in a pipe alters the properties of the water flowing through it, stating that the change in water pressure in the pipe is actually caused by the external force associated with the change in the pipes diameter and, therefore, the change in the water pressure is not a change in the property of the water. Id. at 13, 69-72.

Cables 4.113 The Staff witnesses testified that transformers are different than cables because transformers perform their intended function via a change in state while cables perform their intended function without a change in configuration, property or state. Staff Testimony on NYS-8 (Ex. NRC000031) at 21. Staff witness, Sheila Ray, observed that the intended function of a cable is to transmit power, whereas the intended function of a transformer is to transform voltage and current and to provide electrical isolation between two separate circuits. Tr. at

36 4377-78. In addition, the Staff witnesses stated that the effects of age-related degradation can be monitored in transformers but are not readily monitorable in cables. Staff Testimony on NYS-8 (Ex. NRC000031) at 8, 11-12.

4.114 Entergys witnesses testimony was consistent with the Staffs. Mr. Rucker and Dr. Dobbs testified that cables are intended to conduct electricity without changing it. Entergy Testimony on NYS-8 (Ex. ENTR00091) at 76-77; Tr. at 4238 (Rucker); Tr. at 4397-98 (Dobbs).

Entergys witnesses also testified that age-related condition degradation in cables is not amenable to direct monitoring, whereas age-related condition degradation in transformers is directly monitorable. Entergy Testimony on NYS-8 (Ex. ENTR00091) at 42; Tr. at 4238 (Rucker).

4.115 New Yorks witness disagreed with Entergy and the Staff, asserting that cables and transformers are similar in that both operate without moving parts or a change in configuration, property, or state. New York Testimony on NYS-8 (Ex. NYSR00003) at 6-7; Degeneff Report (Ex. NYSR00005) at 6-7. Dr. Degeneff testified that the purpose of a cable is to transmit power from one point to another. New York Testimony on NYS-8 (Ex. NYSR00003) at 17, Degeneff Report (Ex. NYSR00005) at 6. He further opined that a transformer transmits power in the same way as a cable. New York Rebuttal Testimony on NYS-8 (Ex. NYS000414) at 16. He stated that in its most basic form, a transformer is simply two adjacent current-carrying cables. New York Testimony on NYS-8 (Ex. NYSR00003) at 17, 18. He also stated that both can be represented by the same equation. New York Testimony on NYS-8 (Ex.

NYSR00003) at 18; New York Rebuttal Testimony on NYS-8 (Ex. NYS000414) at 21-22. He further stated that when a current passes through a cable, a magnetic field is generated, and he maintained that the generation of the magnetic field did not constitute a change in the properties of the cable such that it should be considered an active component. New York Testimony on NYS-8 (Ex. NYSR00003) at 18, New York Rebuttal Testimony on NYS-8 (Ex. NYS000414) at 13, 29. In addition, he testified that while performance failure in a cable is readily detectable,

37 functional degradation in both cables and transformers is difficult to detect. New York Rebuttal Testimony on NYS-8 (Ex. NYS000414) at 22-24, 32.

4.116 The Staffs witnesses acknowledged that, in theory, two cables placed in close proximity to one another can function as a simple transformer. Staff Testimony on NYS-8 (Ex.

NRC000031) at 23. However, Ms. Ray pointed out that a magnetic field generated as a result of the placement of two cables in proximity to each other is useless; it just permeates through air without accomplishing anything. Tr. at 4353. In contrast, the magnetic field is essential to transformer function. Tr. at 4354 (Ray); Tr. at 4354-55 (Mathew). The Staffs witnesses concluded that Dr. Degeneffs analogy between cables and transformers is not relevant to the question whether transformers are active or passive components. Staff Testimony on NYS-8 (Ex. NRC000031) at 23.

4.117 Dr. Dobbs, testifying for Entergy, also agreed that, theoretically, adjacent cables can form a kind of transformer. Entergy Testimony on NYS-8 (Ex. ENTR000091) at 65.

However, he noted, the magnetic flux created in the cables is not in the cables themselves, is not required for the cables to perform their intended function, and is not manipulated. Id. at 65, 67; Tr. at 4397-4400. Dr. Dobbs also stated that taken to its logical extreme, Dr. Degeneffs analogy between cables and transformers yielded incongruous results. Entergy Testimony on NYS-8 (Ex. ENTR000091) at 68, 76-77. For these reasons, Dr. Dobbs rejected Dr. Degeneffs assertion that cables and transformers are similar and that they are both passive components.

Reactor Pressure Vessel, Containment, and Steam Generator 4.118 The Staffs witnesses testified that the reactor pressure vessel, containment, and steam generator are long-lived passive components that require an aging management review because (a) the functionality of these components in measured indirectly and (b) age-related degradation in them cannot be easily monitored. Staff Testimony on NYS-8 (Ex. NRC000091) at 23.

38 4.119 Entergys witness, Dr. Dobbs, also testified that these components are passive components. Entergy Testimony on NYS-8 (Ex. ENTR00091) at 72-73. He explained that these components serve the passive function of providing a pressure retaining boundary. Id. at

73. Citing the Statement of Consideration that accompanied the 1995 revisions to the license renewal regulations, 21 Dr. Dobbs stated that the fact that these components serve as part of the pressure boundary is itself sufficient cause for these components to be subject to aging management review. Id.

4.120 For his part, New Yorks witness Dr. Degeneff testified that a steam generator is treated as a passive component by the license renewal regulations because it operates without a change of properties. New York Testimony on NYS-8 (Ex. NYSR00003) at 20; Degeneff Report (Ex. NYSR00005) at 7. He also stated that the reactor vessel and containment are subject to wear and that this wear is the subject of aging management. Id.

4.121 Significantly, Dr. Degeneff did not address the Staffs testimony that age-related degradation in the condition of steam generators, reactor vessels, and containment are not readily monitorable, whereas age-related degradation in the condition of transformers is readily monitorable.

E. The Absence of Transformers in 10 C.F.R. § 54.21 4.122 The discussion above demonstrates that some disagreement remains between New Yorks witness, on the one hand, and the witnesses proffered by Entergy and the Staff.

Based on our consideration of the evidence and our observation of the witnesses, we believe that the better view, and the view best supported by the evidence and the regulatory history is that transformers should be categorized as active components under 10 C.F.R. § 54.21(a)(1).

4.123 As discussed above (see proposed findings of fact 4.11 through 4.23), the Commission, in the 1995 Statement of Consideration that accompanied the revision of the 21 License Renewal SOC (Ex. NYS000016), 60 Fed. Reg. at 22,477

39 license renewal rule, discussed the difference between active and passive components at length, giving numerous examples of those two types of components and, importantly, explaining the rationale for the difference in treatment. The rationale for the difference in treatment of active components as opposed to passive components includes one very significant variable: monitorability. As stated by the Commission, active components, which change configuration, property, or state, are directly and readily monitorable. Thus, the Commission concluded, existing regulatory programs can be relied upon to address age-related degradation in them. Passive components, on the other hand, are not directly or readily monitorable, and the Commission therefore determined that existing regulatory programs for those components should be augmented by an aging management review and aging management programs. The Statement of Consideration, particularly its rationale for the difference in treatment of active versus passive components, supports the Staffs and Entergys conclusion that transformers are active components that are not subject to aging management review and do not require an aging management program.

4.124 The key test enunciated in the Statement of Consideration for distinguishing between active and passive components is a determination as to what is needed to provide reasonable assurance that the components will be able to perform their intended functions (i.e.,

functionality) during the period of extended operation following license renewal. License Renewal SOC (Ex. NYS000016), 60 Fed. Reg. at 22475.

4.125 To determine what is required to provide reasonable assurance of functionality, the Commission examined how performance and condition are addressed under existing programs, id. at 22474, 22484, and sought to identify any additional actions that will be needed to maintain the functionality of the systems, structures, and components in the period of extended operation. Id. at 22464.

4.126 The Commission determined that for active components, existing programs, including the Maintenance Rule, would be sufficient. Id. at 22472.

40 4.127 The Commission determined that, for passive components that cannot be directly and readily monitored, existing programs would not be sufficient to assure functionality and, therefore, those existing programs would need to be augmented. Id. at 22469. That augmentation takes the form of the aging management review and specific aging management programs. The Commission concluded that an aging management review of the passive functions of structures and components is warranted to provide the reasonable assurance that their intended functions are adequately maintained during the period of extended operations.

Id. at 22476.

4.128 The second factor, identified in the 1995 Statement of Consideration, to be used in determining whether a component is active or passive relates to whether the component undergoes a change in state, configuration, or properties. We note that the teerms active and passive do not appear in the regulation. The Commission acknowledged, in the Statement of Consideration that accompanied the issuance of the regulation, that it employed the term, passive as a convenience and that devices that operate via a change in state are sometimes referred to in the literature as passive. Id. at 22477. The Commission therefore explicitly stated that a change in configuration or properties should be interpreted to include a change in state. Id. The Commission cited a transistor as a component that it would consider active, even though it operated via a change in state and without moving parts. Id.

4.129 In its 1995 Statement of Consideration, the Commission explicitly warned that it had coined the term passive for use only in the context of license renewal. Id.; see also Tr. at 4225 (Craig). New Yorks citations to industry definitions of transformers, that refer to them as passive devices (NYS000006, NYS000008, NYS000009, NYS000010), are thus unavailing.

As the Commission made clear in its Statement of Consideration, description of a component outside of the license renewal process as passive is not relevant and certainly not dispositive for license renewal purposes. License Renewal SOC (Ex. NYS000016), 60 Fed. Reg. at 22477.

41 What is dispositive, however, is the way in which functionality and condition are assessed and addressed. Tr. at 4222-27 (Craig); Tr. at 4226-27 (Dobbs); Tr. at 4227-28 (Mathew).

4.130 In its Statement of Consideration, the Commission noted that while active functions can be verified directly, passive functions are less directly verified. License Renewal SOC (Ex. NYS000016), 60 Fed. Reg. at 22471. Further, the Commission determined that where performance and condition are readily monitorable through existing programs, no additional aging management review is required. Id. at 22471-72; see also NextEra Energy Seabrook, LLC (Seabrook Station, Unit 1), CLI-12-05, __ NRC __ (March 8, 2012) (slip op. at 19).

4.131 Where, however, performance and condition cannot be readily monitored, additional consideration, via an aging management review, is needed. 60 Fed. Reg. at 22476, 22477; see also Seabrook, CLI-12-05, __ NRC at __ (slip op. at 20).

4.132 In the recent Seabrook decision, the Commission rejected a contention virtually identical to Contention NYS-8. Seabrook, CLI-12-05, __ NRC __ (slip op. at 27). The Commission noted that the Statement of Consideration focused on the proposition that active components have moving parts or change configuration or properties, and the conclusion that such components are thus readily monitorable both for performance and condition. Id. at 20 n.95.

4.133 Active components provide clear indications of gross failure. License Renewal SOC (Ex. NYS000016), 60 Fed. Reg. at 22471. Passive components, however, can fail without the failure being apparent until demand or actuation under certain conditions. Id. The Statement of Consideration gives the example of the passive functions of pressure boundary and structural integrity which are generally verified indirectly, by confirmation of physical dimensions or components physical condition and are not directly ascertainable. Id.

4.134 Further, in the Statement of Consideration, the Commission compared the extensive experience associated with the performance and condition monitoring of the active

42 functions of structures and components with the little experience [that] has been gained from the evaluation of long-term effects of aging on the passive functions of structures and components. Id. The Commission concluded that because the detrimental effects of aging that affect passive functions are less apparent than the detrimental effects of aging on active functions, passive components should be subjected to aging management review. Id. On the other hand, with respect to active components, the Commission concluded that existing licensee programs and activities, and the maintenance rule provide the basis for generically excluding structures and components that perform active functions from an aging management review. Id. at 22471-72; see also Seabrook, CLI-12-05, (slip op. at 19).

4.135 For passive components, the Commission determined that existing programs, including the Maintenance Rule, were not sufficient to address age-related degradation. The Commission noted that there is minimal preventive maintenance or monitoring for passive components and, therefore, additional programs are necessary to manage age-related degradation for them. License Renewal SOC (Ex. NYS000016), 60 Fed. Reg. at 22470-71, 22477.

4.136 Application of the twin tests of (a) monitorability of performance and condition, and (b) changes in state, configuration or condition, demonstrates that transformers are active components that require no aging management review or aging management program. In sum, transformers perform their intended functions through a change in state and thus their performance is readily monitorable. Staff Testimony on NYS_8 (Ex. NRC000031) at 12.

4.137 While the Commission identified a number of components as active and passive in the Statement of Consideration for the 1995 rule, it did not identify transformers as a member of either group. It acknowledged, however, that its list of components subject to aging management review and those not subject to aging management review was incomplete.

License Renewal SOC (Ex. NYS000016), 60 Fed. Reg. at 22479.

43 4.138 In response to a commenter who suggested that the Commission provide comprehensive lists of components that are active and passive, the Commission explained aging management review was highly plant-specific. The Commission, therefore, declined to publish a comprehensive list but promised to provide additional clarification and examples of components requiring an aging management review in its implementation guidance for the rule.

Id.; see also 60 Fed. Reg. at, 22485; Tr. at 4385 (Mathew).

4.139 The Commission provided its promised implementation guidance in 1997, in the form of a letter from C. Grimes to D. Walters at NEI (Grimes Letter) (Ex. ENT000097)

(discussed in Seabrook, CLI-12-05, ___ NRC at ___ (slip op. at 20-21, 23-24). The Grimes Letter provided the promised clarification and examples of components requiring aging management review.

4.140 In the Grimes Letter, the Staff explained that transformers are active components that do not require aging management review because they function through a change in state and are subject to performance and condition monitoring that will reveal age-related degradation. Grimes Letter (Ex. ENT000097) at 2.

4.141 In 2005, the Nuclear Energy Institute (NEI) published Revision 6 to NEI 95-10, Industry Guideline for Implementing the Requirements of 10 CFR Part 54 - the License Renewal Rule (Ex. ENT000098). NEI incorporated the Grimes Letter in its guidelines. Ex.

ENT000098, at B-14 and C-9 though 14; Tr. at 4362 (Ray) and 4264 (Mathew).

4.142 The NRC Staff approved NEI 95-10, Rev. 6, in Regulatory Guide 1.188, Standard Format and Content for Applications to Renew Nuclear Power Plant Operating Licenses, Rev. 1, (Sept. 2005) (ENT000099) at 7; Tr. at 4364 (Mathew).

F. Summary of Findings 4.143 We find that the parties are in general agreement regarding how electrical transformers function and the methods and programs available to monitor their performance.

44 4.144 Our review of the evidence was informed by the history of the regulation in 10 C.F.R. § 54.21(a) and an examination of the purpose of the regulation and how that purpose would be served by the classification of electrical transformers as either components that require or do not require aging management review.

4.145 The evidence supports our finding, which is consistent with 10 C.F.R. § 54.21(a) and the 1995 Statement of Consideration, that electrical transformers perform their intended function by means of a change in state and that they are readily monitored for performance and condition. We find that existing regulatory programs are sufficient to provide reasonable assurance that transformers will function during the period of extended operation. We also find that transformers are similar to the components identified in the regulations as active and dissimilar to the components identified in the regulations as passive.

III. CONCLUSIONS OF LAW 4.142. The Board has considered all of the evidence presented by the parties on Contention NYS-8. Based upon a review of the entire record in this proceeding and the proposed findings of fact and conclusions of law submitted by the parties, and based upon the findings of fact set forth above, which are supported by reliable, probative and substantial evidence in the record, the Board has decided all matters in controversy concerning this contention and reaches the following conclusions.

4.143. The regulation in 10 C.F.R. § 54.21(a)(1) requires every license renewal application to include an aging management review for passive components that perform their intended functions without a change in configuration or properties. Performance of an aging management review may then be followed by an aging management program, in which a license renewal applicant identifies the inspection, surveillance, monitoring and maintenance programs it intends to use to provide reasonable assurance that the component will continue to function throughout the period of extended operation.

45 4.144. Because electrical transformers perform their intended function by means of a change in properties, and their functionality is directly and readily verifiable and in light of their similarity to other active components and dissimilarity to passive components, we conclude that Entergys license renewal application was not required to include an aging management review or an aging management program for electrical transformers.

4.145. Therefore, we conclude that Entergys license renewal application meets the requirements of 10 C.F.R. § 54.21, with respect to electrical transformers within the scope of license renewal. We therefore find that Contention NYS-8 should be, and is hereby, resolved in favor of Entergy.

Respectfully submitted

/Signed Electronically by/

Beth N. Mizuno Counsel for NRC Staff U.S. Nuclear Regulatory Commission Mail Stop O-15 D21 Washington, DC 20555-0001 Telephone: (301) 415-3122 E-mail: Beth.Mizuno@NRC.gov Dated at Rockville, Maryland this 22nd day of March 2013

UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION BEFORE THE ATOMIC SAFETY AND LICENSING BOARD In the Matter of )

)

ENTERGY NUCLEAR OPERATIONS, INC. ) Docket Nos. 50-247-LR/ 50-286-LR

)

(Indian Point Nuclear Generating )

Units 2 and 3) )

CERTIFICATE OF SERVICE Pursuant to 10 C.F.R § 2.305 (as revised), I hereby certify that copies of the foregoing NRC STAFFS PROPOSED FINDINGS OF FACT AND CONCLUSIONS OF LAW PART 4:

CONTENTION NYS-8 (TRANSFORMERS) dated March 22, 2013, have been served upon the Electronic Information Exchange (the NRCs E-Filing System), in the above- captioned proceeding, this 22nd day of March, 2013.

/Signed (electronically) by/

Beth N. Mizuno Counsel for NRC Staff U. S. Nuclear Regulatory Commission Office of the General Counsel Mail Stop - O-15D21 Washington, DC 20555 Telephone: (301) 415-3122 Email: Beth.Mizuno@nrc.gov