Thursday, January 19, 2012

Will Safety Culture Kill Palisades?

To tell the truth, I have no idea.  But the plant has an interesting history and reviewing it may give us some hints with respect to the current situation.

If Palisades were a person, we would think it existed in almost laboratory-like conditions for developing a distinct cultural strain.  It’s elderly, a little “different” and a singleton, with a stillborn sibling and a parent who never really loved it.

Palisades is the 9th oldest of U.S. units that are still operating and was/is Combustion Engineering’s first commercial reactor.  C-E reactors were not as popular as GE or Westinghouse; about 13 percent of the current U.S. fleet uses C-E reactors.  The other old units were owned by companies that developed additional nuclear plants but that didn’t happen for Palisades.  It was supposed to have a big brother, Midland, but the project collapsed, primarily because of construction problems, in 1984 when Midland was about 85% complete, almost bankrupting the owner, Consumers Power (which morphed into CMS Energy and then Consumers Energy.) 

Consumers was looking for someone else to operate or take over the plant as far back as the early 1990s.  Eventually, in 2001, they hired the Nuclear Management Company to operate the plant.  That relationship continued until the plant was sold to Entergy in April 2007.

New managers were able to increase performance in terms of capacity factor (CF).  Under Consumers management, 1996-2000 average CF was 85.2%; under NMC, 2002-2006 CF was 90.0 %; and under Entergy, 2007-2010 CF was 93.0%.  In addition, each of those averages was higher than the average CF of the entire U.S. nuclear fleet for the same period.  (I deliberately omitted 2001; it was a terrible year, with a normal refueling outage followed by a six-month maintenance outage to replace control rod drive assemblies.)

More important from the standpoint of trying to infer something about the safety culture, Palisades kept its nose clean with respect to the NRC.  There were three Severity Level III violations during the Consumers era, and one SL-III and one White violation in 2001.  It looks like three different management regimes were able to maintain an effective safety culture but there has been a recent lapse with three White violations since 2009 and preliminary White and Yellow findings in process.


What does this tell us, if anything?  Has Entergy been squeezing the plant too hard?  Did the CF success under Entergy lead to complacency?  Are there any long-standing material condition problems to sap morale and depress safety culture?  Have there been regular, in-depth independent assessments of organizational issues?  I have no insight into this situation although in our Jan. 12 post, I said it looked like the process of normalization of deviance had occurred.  But there is one thing that should jolt the staff into paying attention to detail, at least for awhile: Some Entergy MBA is carefully watching the numbers.  If the NRC shuts down Palisades, it won’t be long before Entergy folds up its tent and walks away.  No generation means no revenue.  And I can’t believe the PSC or ratepayers in economically depressed Michigan have much interest in bailing out a carpetbagger owner.

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