United States Nuclear Regulatory Commission - Protecting People and the Environment

Information to Licensees Regarding NRC Inspection Manual Section on Resolution of Degraded and Nonconforming Conditions (Generic Letter 91-18, Revision 1)

					                   UNITED STATES
                               NUCLEAR REGULATORY COMMISSION
                           OFFICE OF NUCLEAR REACTOR REGULATION
                                WASHINGTON, D.C. 20555-0001

                                      October 8, 1997


NRC GENERIC LETTER NO. 91-18, REVISION 1:  INFORMATION TO LICENSEES REGARDING
                                           NRC INSPECTION MANUAL SECTION ON
                                           RESOLUTION OF DEGRADED AND
                                           NONCONFORMING CONDITIONS


Addressees

All holders of operating licenses for nuclear power and non-power reactors,
including those power reactor licensees who have permanently ceased
operations, and all holders of non-power reactor licenses whose license no
longer authorizes operation.

Purpose

The U.S. Nuclear Regulatory Commission (NRC) is issuing this generic letter to
inform licensees of the issuance of a revised section of Part 9900, "Technical
Guidance," of the NRC Inspection Manual.  The revised section is entitled
"Resolution of Degraded and Nonconforming Conditions."  The revisions to this
section of Part 9900 more explicitly discuss the role of the 10 CFR 50.59
evaluation process in the resolution of degraded and nonconforming conditions. 
The Part 9900 guidance on operability forwarded by Generic Letter (GL) 91-18
has not been revised.  This letter is provided for information only; no
specific action or written response is required.  

Background

The previous version of NRC Inspection Manual, Part 9900, "Technical
Guidance," on the Resolution of Degraded and Nonconforming Conditions, was
issued for information in GL 91-18, on November 7, 1991.  This guidance
provided a process for licensees to develop a basis to continue operation or
to place the plant in a safe condition and to take prompt corrective action. 
It contained a number of provisions that relate to the role of 10 CFR 50.59
and the basis for continued operation of a facility.  

Section 4.3.2, "Changing the Current Licensing Basis To Satisfy an Appendix B
Corrective Action," stated:  

       A licensee may change the design of its plant as described in the
       FSAR in accordance with 10 CFR 50.59, at any time.  Whenever such
       changes are sufficient to resolve a degraded or nonconforming
       condition involving an SSC [system, structure, or component] that
       is subject both to Appendix B and 50.59, they may be used in lieu
       of restoring the affected equipment to its original  

9710060322.                                                   GL 91-18, Revision 1
                                                              October 8, 1997
                                                              Page 2 of 5


       design.  However, whenever such a change involves a unreviewed safety
       question (USQ) or change in a technical specification (TS), the licensee
       must obtain a license amendment in accordance with 10 CFR 50.90 prior to
       operating (emphasis added) the plant with the degraded or nonconforming
       condition...
                               
Section 4.5.1, "Justification for Continued Operation (JCO) Background,"
stated:

       The license authorizes the licensee to operate the plant in
       accordance with the regulations, license conditions, and the TS. 
       If an SSC is degraded or nonconforming but operable, the license
       provides authorization to operate and the licensee does not need
       further justification.  The licensee must, however, promptly
       identify and correct the condition adverse to safety or quality in
       accordance with 10 CFR Part 50, Appendix B, Criterion XVI.  

A footnote to the flow chart attached to the Part 9900 guidance stated:  

       50.59 may be used to make a change in a facility, as described in
       the SAR, which would resolve the condition adverse to safety or
       quality so that the degraded and nonconforming condition no longer
       exists.  Delay or partial correction of conditions adverse to
       safety or quality is considered a change in facility or procedures
       and subject to 50.59 review.  

The NRC Inspection Manual Part 9900 guidance, "10 CFR 50.59 - Interim Guidance
on the Requirements Related to Changes to Facilities, Procedures, and Tests
(or Experiments)," issued in April 1996, specifically refers to the Part 9900
attached to GL 91-18 for guidance concerning 10 CFR 50.59 in the resolution of
degraded and nonconforming conditions.  

As part of its reevaluation of the 10 CFR 50.59 process, the staff recognized
that the guidance in GL 91-18 was not complete, and may in some respects be
inconsistent.  Therefore, the staff developed additional guidance on the
application of 10 CFR 50.59 to the resolution of degraded and nonconforming
conditions.  The staff's proposed guidance was published for public comment,
as part of draft NUREG-1606, "Proposed Regulatory Guidance Related to
Implementation of 10 CFR 50.59 (Changes, Tests, or Experiments)," on May 7,
1997 (62 FR 24947).  

Description of Circumstances

The proposed guidance published for comment on May 7, 1997, discussed the
application of 10 CFR 50.59 to implementation of compensatory measures, how
"delay" should be interpreted, and how the guidance about obtaining a license
amendment operating the facility with a condition involving a USQ should be
interpreted.  In this proposed guidance, the staff stated that implementation
of compensatory measures required a 10 CFR 50.59 evaluation with respect to
the condition described in the final safety analysis report (FSAR) and that
the staff would consider delay to have occurred when a licensee has not
implemented corrective action at the first available opportunity (considering
need for analysis or parts, or the need to be in cold shutdown to complete the
action), in any event not to exceed the next refueling outage.  Finally, the
staff proposed that when a licensee determined that resolution of a.                                                              

GL 91-18, Revision 1
                                                              October 8, 1997
                                                              Page 3 of 5


nonconforming condition involved a USQ, the license amendment should be issued
before the plant resumed operation from any shutdown (the NRC would not
require a plant to shut down in such circumstances provided that SSCs required
for operation were operable).  Over the last several months, a number of
nonconforming conditions have been identified at operating plants through
licensee reviews and NRC inspections.  Based on staff experience in dealing
with these situations, the staff has concluded that a revision to the
Part 9900 guidance, "Resolution of Degraded and Nonconforming Conditions," was
appropriate.  

Many of the comments received in response to the Federal Register notice
stated that the position that should be applied is more consistent with the
discussion in Section 4.5.1 of the existing Part 9900 guidance, that is, if
SSCs are operable but degraded, the license provides authority for continued
operation, and existence of a USQ, by itself, should not be an impediment to a
plant's ability to resume operation.  

Commenters noted that the policy of not requiring plant shutdown but
preventing plant restart was arbitrary, and had no basis in safety. 
Commenters also suggested that delay in implementation of corrective action is
a matter for enforcement of 10 CFR Part 50, Appendix B, and not for requiring
a 10 CFR 50.59 evaluation.  The commenters also stated that requiring a 10 CFR
50.59 evaluation of compensatory measures against the condition described in
the safety analysis report (SAR) would essentially preclude licensee
implementation of compensating actions that enhance safety when degraded or
nonconforming conditions are found.  

On the basis of the staff's continuing review of the issues associated with
nonconforming conditions and with interpretations of 10 CFR 50.59
requirements, and of the public comments that were received in response to the
Federal Register notice, the staff determined that it would be beneficial at
this time to issue a revision to this Inspection Manual Chapter 9900 guidance,
even before other aspects of potential guidance are resolved, because of the
impacts on plant operation.  Therefore, through this generic letter, the NRC
is notifying addressees of the issuance of the attached NRC Inspection Manual
guidance.  

Discussion

As discussed in more detail in the attached guidance, the staff now concludes
that the need to obtain NRC approval for the final resolution of a degraded or
nonconforming condition does not affect the licensee's authority to continue
operation (or restart from a shutdown), provided that necessary equipment is
operable and the degraded equipment is not in conflict with any technical
specification.  Thus, Section 4.3.2 has been revised, and other conforming
changes made, to note this change in staff guidance.  
 
On July 21, 1997, the Nuclear Energy Institute (NEI) submitted to the NRC a
guidance document, NEI 96-07 [Final Draft], "Guidelines for 10 CFR 50.59
Safety Evaluations."  Part of this guidance relates to applicability of 10 CFR
50.59 to degraded and nonconforming conditions.  .                                                              

GL 91-18, Revision 1
                                                              October 8, 1997
                                                              Page 4 of 5


The specific guidance is:

       In the case of a nonconforming condition, there are three
       potential scenarios for addressing the condition:

       .    If the condition is accepted "as-is" resulting in
            something different than described in the SAR or is
            modified to something different than described in the SAR,
            then the condition should be considered a change and
            subjected to a 10 CFR 50.59 safety evaluation unless
            another regulation  applies (i.e., 10 CFR 50.55a).  

       .    If the licensee intends to restore the SSC back to its
            previous condition (as described in the SAR), then this
            corrective action should be performed in accordance with
            10 CFR Part 50, Appendix B (i.e., in a timely manner
            commensurate with safety), and a 10 CFR 50.59 safety
            evaluation is not required.  

       .    If an interim compensatory action is taken to address the
            condition and involves a procedure change or temporary
            modification, a 10 CFR 50.59 review should be conducted
            and may result in a safety evaluation.  The intent is to
            determine whether the compensatory action itself (not the
            degraded condition) impacts other aspects of the facility
            described in the SAR.  

The staff finds this industry guidance acceptable with respect to the need for
a 10 CFR 50.59 safety evaluation for degraded and nonconforming conditions. 
Therefore, the revised Part 9900 Inspection Manual guidance references this
industry guidance.  

As noted in the Part 9900 guidance, the NRC will take enforcement action if it
determines that licensee corrective action (which may include submittal of a
license amendment request) is not prompt, or that operability determinations
are not sound.  Enforcement action may also be taken for the circumstances
that led to the existence of the degraded or nonconforming condition..                                                              

GL 91-18, Revision 1
                                                              October 8, 1997
                                                              Page 5 of 5


This generic letter was not published for public comment because the issues
covered by the revision were previously published for public comment in
May 1997, and the staff's guidance is responsive to the comments received. 
This generic letter requires no specific action or response.  If you have any
questions about this matter, please contact the technical contact listed
below.


                                          signed by

                                          Jack W. Roe, Acting Director
                                          Division of Reactor Program Management
                                          Office of Nuclear Reactor Regulation

Technical contact:  Eileen M. McKenna, NRR
                    301-415-2189
                    Email:  emm@nrc.gov

Attachments:
1.  Inspection Manual Part 9900 Guidance, "Resolution of
    Degraded and Nonconforming Conditions"
2.  List of Recently Issued NRC Generic Letters.                                                              

Attachment 1
                                                              GL 91-18, Revision 1
                                                              October 8, 1997
                                                              Page 1 of 14


                                      NRC INSPECTION MANUAL 
                           OTSB  PART 9900:  TECHNICAL GUIDANCE STS30DEG.TG
                         RESOLUTION OF DEGRADED AND NONCONFORMING CONDITIONS                                                             
                         
                         
Attachment 1
                                                              GL 91-18, Revision 1
                                                              October 8, 1997
                                                              Page 2 of 14

                                       RESOLUTION OF
                           DEGRADED AND NONCONFORMING CONDITIONS

Table of Contents                                                                     Page

1.0    PURPOSE AND SCOPE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1

2.0    DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2

       2.1  Current Licensing Basis . . . . . . . . . . . . . . . . . . . . . . . . . . .2

       2.2  Design Basis. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2

       2.3  Degraded Condition. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2

       2.4  Nonconforming Condition . . . . . . . . . . . . . . . . . . . . . . . . . . .2

       2.5  Full Qualification. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3

3.0    BACKGROUND . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3

4.0    DISCUSSION OF NOTABLE PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . .3

       4.1  Public Health and Safety. . . . . . . . . . . . . . . . . . . . . . . . . . .3

       4.2  Operability Determinations. . . . . . . . . . . . . . . . . . . . . . . . . .3

       4.3  The Current Licensing Basis and 10 CFR 50 Appendix B. . . . . . . . . . . . .4
       
       4.4  Discovery of an Existing But Previously Unanalyzed
            Condition or Accident . . . . . . . . . . . . . . . . . . . . . . . . . . . .4

       4.5  Justification for Continued Operation (JCO) . . . . . . . . . . . . . . . . .4

            4.5.1    Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4

            4.5.2    JCO Definition . . . . . . . . . . . . . . . . . . . . . . . . . . .5

            4.5.3    Items for Consideration in a JCO . . . . . . . . . . . . . . . . . .5

            4.5.4    Discussion of Industry-Type JCOs . . . . . . . . . . . . . . . . . .6.                                                              Attachment 1
                                                              GL 91-18, Revision 1
                                                              October 8, 1997
                                                              Page 3 of 14

       4.6  Reasonable Assurance of Safety. . . . . . . . . . . . . . . . . . . . . . . .6

       4.7  Evaluation of Compensatory Measures . . . . . . . . . . . . . . . . . . . . .6

       4.8  Final Corrective Action . . . . . . . . . . . . . . . . . . . . . . . . . . .7

5.0    REFERENCE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  9.                                                              Attachment 1
                                                              GL 91-18, Revision 1
                                                              October 8, 1997
                                                              Page 4 of 14

                                       RESOLUTION OF
                           DEGRADED AND NONCONFORMING CONDITIONS


1.0    PURPOSE AND SCOPE:

To provide guidance to NRC inspectors on resolution of degraded and
nonconforming conditions affecting the following systems, structures, or
components (SSCs):

(i)    Safety-related SSCs, which are those relied upon to remain functional
       during and following design basis events (A) to ensure the integrity of
       the reactor coolant pressure boundary, (B) to ensure the capability to
       shut down the reactor and maintain it in a safe shutdown condition, or
       (C) to ensure the capability to prevent or mitigate the consequences of
       accidents that could result in potential offsite consequences comparable
       to the 10 CFR Part 100 guidelines.  Design basis events are defined the
       same as in 10 CFR 50.49(b)(1).

(ii)   All SSCs whose failure could prevent satisfactory accomplishment of any
       of the required functions identified in (i) A, B, and C.

(iii)  All SSCs relied on in the safety analyses or plant evaluations that are
       a part of the plant's current licensing basis.  Such analyses and
       evaluations include those submitted to support license amendment
       requests, exemption requests, or relief requests, and those submitted to
       demonstrate compliance with the Commission's regulations such as fire
       protection (10 CFR 50.48), environmental qualification (10 CFR 50.49),
       pressurized thermal shock (10 CFR 50.61), anticipated transients without
       scram (10 CFR 50.62), and station blackout (10 CFR 50.63).

(iv)   Any SSCs subject to 10 CFR Part 50, Appendix B.

(v)    Any SSCs subject to 10 CFR Part 50, Appendix A, Criterion 1.

(vi)   Any SSCs explicitly subject to facility Technical Specifications (TS).

(vii)  Any SSCs subject to facility TS through the definition of operability
       (i.e., support SSCs outside TS).

(viii) Any SSCs described in the final safety analysis report (FSAR).

This guidance is directed toward NRC inspectors who are reviewing actions of
licensees that hold an operating license.  Although this guidance generally
reflects existing staff practices, .                                                              

Attachment 1
                                                              GL 91-18, Revision 1
                                                              October 8, 1997
                                                              Page 5 of 14

application to specific plants may constitute a backfit.  Consequently,
significant differences in licensee practices should be discussed with NRC
management to ensure that the guidance is applied in a reasonable and
consistent manner for all licensees.

2.0    DEFINITIONS

2.1    Current Licensing Basis

Current licensing basis (CLB) is the set of NRC requirements applicable to a
specific plant, and a licensee's written commitments for assuring compliance
with and operation within applicable NRC requirements and the plant-specific
design basis (including all modifications and additions to such commitments
over the life of the license) that are docketed and in effect.  The CLB
includes the NRC regulations contained in 10 CFR Parts 2, 19, 20, 21, 30, 40,
50, 51, 55, 72, 73, 100 and appendices thereto; orders; license conditions;
exemptions, and TS.  It also includes the plant-specific design basis
information defined in 10 CFR 50.2 as documented in the most recent FSAR as
required by 10 CFR 50.71 and the licensee's commitments remaining in effect
that were made in docketed licensing correspondence such as licensee responses
to NRC bulletins, generic letters, and enforcement actions, as well as
licensee commitments documented in NRC safety evaluations or licensee event
reports.

2.2    Design Basis

Design basis is that body of plant-specific design bases information defined
by 10 CFR 50.2.

2.3    Degraded Condition

A condition of an SSC in which there has been any loss of quality or
functional capability.

2.4    Nonconforming Condition

A condition of an SSC in which there is failure to meet requirements or
licensee commitments.  Some examples of nonconforming conditions include the
following:

       1.   There is failure to conform to one or more applicable codes or
            standards specified in the FSAR.

       2.   As-built equipment, or as-modified equipment, does not meet FSAR
            descriptions.

       3.   Operating experience or engineering reviews demonstrate a design
            inadequacy.

       4.   Documentation required by NRC requirements such as 10 CFR 50.49 is
            not available or deficient..                                                              
            

Attachment 1
                                                              GL 91-18, Revision 1
                                                              October 8, 1997
                                                              Page 6 of 14

2.5    Full Qualification

Full qualification constitutes conforming to all aspects of the current
licensing basis, including codes and standards, design criteria, and
commitments.

3.0    BACKGROUND:

A nuclear power plant's SSCs are designed to meet NRC requirements, satisfy
the current licensing basis, and conform to specified codes and standards. 
For degraded or nonconforming conditions of these SSCs, the licensee may be
required to take actions required by the TS.  The provisions of Title 10 of
the "Code of Federal Regulations" (10 CFR), Part 50, Appendix B, Criteria XVI,
may apply requiring the licensee to identify promptly and correct conditions
adverse to safety or quality.  Reporting may be required in accordance with
Sections 50.72, 50.73, and 50.9(b) of 10 CFR Part 50, 10 CFR Part 21, and the
TS.  Collectively, these requirements may be viewed as a process for licensees
to develop a basis to continue operation or to place the plant in a safe
condition, and to take prompt corrective action.  Changes to the facility in
accordance with 10 CFR 50.59 may be made as part of the corrective action
required by Appendix B.  The process displayed by means of the attached chart
titled, "Resolution of Degraded and Nonconforming Conditions," recognizes
these and other provisions that a licensee may follow to restore or establish
acceptable conditions.  These provisions are success paths that enable
licensees to continue safe operation of their facilities.

4.0   DISCUSSION OF NOTABLE PROVISIONS

4.1   Public Health and Safety

All success paths, whether specifically stated or not, are first directed to
ensuring public health and safety and second to restoring the SSCs to the
current licensing basis of the plant as an acceptable level of safety. 
Identification of a degraded or nonconforming condition that may pose an
immediate threat to the public health and safety requires the plant to be
placed in a safe condition.

Technical Specifications (TS) address the safety systems and provide Limiting
Conditions for Operation (LCOs) and Allowed Outage Times (AOTs) required to
ensure public health and safety.

4.2   Operability Determinations

For guidance on operability see the Inspection Manual, Part 9900, "OPERABLE/
OPERABILITY:  ENSURING THE FUNCTIONAL CAPABILITY OF A SYSTEM OR COMPONENT,"
and see the Inspection Manual, Part 9900, "STANDARD TECHNICAL SPECIFICATIONS
STS SECTION 1, OPERABILITY.".                                                              

Attachment 1
                                                              GL 91-18, Revision 1
                                                              October 8, 1997
                                                              Page 7 of 14

4.3   The Current Licensing Basis and 10 CFR 50, Appendix B

The design and operation of a nuclear plant is to be consistent with the
current licensing basis.  Whenever degraded or nonconforming conditions of
SSCs subject to Appendix B are identified, Appendix B requires prompt
corrective action to correct or resolve the condition. The licensee must
establish a time frame for completion of corrective action.  The timeliness of
this corrective action should be commensurate with the safety significance of
the issue.  The time frame governing corrective action begins with the
discovery of the condition, not with the time when it is reported to the NRC. 
In determining whether the licensee is making reasonable efforts to complete
corrective action promptly, NRC will consider whether corrective action was
taken at the first opportunity, as determined by safety significance (effects
on operability, significance of degradation) and by what is necessary to
implement the corrective action.  Factors that might be included are the
amount of time required for design, review, approval, or procurement of the
repair/modification; availability of specialized equipment to perform the
repair; or the need to be in a hot or cold shutdown to implement the actions. 
The NRC expects time frames longer than the next refueling outage to be
explicitly justified by the licensee as part of the deficiency tracking
documentation.  If the licensee does not resolve the degraded or nonconforming
condition at the first available opportunity or does not appropriately justify
a longer completion schedule, the staff would conclude that corrective action
has not been timely and would consider taking enforcement action. 

4.4    Discovery of an Existing But Previously Unanalyzed Condition or Accident

In the course of its activities, the licensee may discover a previously
unanalyzed condition or accident.  Upon discovery of an existing but
previously unanalyzed condition that significantly compromises plant safety,
the licensee shall report that condition in accordance with 10 CFR 50.72 and
50.73, and put the plant in a safe condition.

For a previously unanalyzed condition or accident that is considered a
significant safety concern, but is not part of the design basis, the licensee
may subsequently be required to take additional action after consideration of
backfit issues (see Section 50.109(a)(5)).

4.5    Justification for Continued Operation (JCO)

4.5.1  Background

The license authorizes the licensee to operate the plant in accordance with
the regulations, license conditions, and the TS.  If an SSC is degraded or
nonconforming but operable, the license establishes an acceptable basis to
continue to operate and the licensee does not need to take any further
actions.  The licensee must, however, promptly identify and correct the
condition adverse to safety or quality in accordance with 10 CFR Part 50,
Appendix B, Criterion XVI..                                                              

Attachment 1
                                                              GL 91-18, Revision 1
                                                              October 8, 1997
                                                              Page 8 of 14

The basis for this authority to continue to operate arises because the TS
contain the specific characteristics and conditions of operation necessary to
obviate the possibility of an abnormal situation or event giving rise to an
immediate threat to public health and safety.  Thus, if the TS are satisfied,
and required equipment is operable, and the licensee is correcting the
degraded or nonconforming condition in a timely manner, continued plant
operation does not pose an undue risk to public health and safety.

Under certain defined and limited circumstances, the licensee may find that
strict compliance with the TS would cause an unnecessary plant action not in
the best interest of public health and safety.  NRC review and action is
required prior to the licensee taking actions that are contrary to compliance
with the license conditions or TS unless an emergency situation is present
such that 10 CFR 50.54(x) and (y) is applied.  A JCO, as defined herein for
general NRC purposes, is the licensee's technical basis for requesting NRC
responses to such action.

4.5.2       JCO Definition

A Justification for Continued Operation (JCO) is the licensee's technical
basis for requesting authorization to operate in a manner that is prohibited
(e.g., outside TS or license) absent such authorization.  The preparation of
JCOs does not constitute authorization to continue operation.

4.5.3       Items for Consideration in a JCO

Some items which are appropriate for consideration in a licensee's development
of a JCO include:

       .    Availability of redundant or backup equipment
       .    Compensatory measures including limited administrative controls
       .    Safety function and events protected against
       .    Conservatism and margins, and
       .    Probability of needing the safety function.
       .    Probabilistic Risk Assessment (PRA) or Individual Plant Evaluation
            (IPE) results that determine how operating the facility in the
            manner proposed in the JCO will impact the core damage frequency..                                                              Attachment 1
                                                              GL 91-18, Revision 1
                                                              October 8, 1997
                                                              Page 9 of 14

4.5.4       Discussion of Industry-Type JCOs

Currently, some licensees refer to two other documents or processes as JCOs
that are not equivalent to and do not perform the same function as the
NRC-recognized JCO (as defined in 4.5.2).  This is an acceptable industry
practice and to the extent the industry JCO fulfills other NRC requirements,
the JCOs will be selectively reviewed and audited accordingly.

In the first industry-type JCO, the licensee may consider the entire process
depicted in the attached chart as a single JCO that includes such things as
the basis for operability, PRA, corrective action elements, and alternative
operations.

In the second industry-type JCO, the licensee may consider the documentation
that is developed to support facility operation after the operability decision
has been made as a JCO.  This documentation can cover any or all of the items
listed under "Interim Operation" on the attached chart.

Although the "JCO" is used differently by some licensees, the NRC concern is
that the operability decision is correct, documentation of licensee's actions
are appropriate, and submittals to the NRC are complete.  The licensee's
documentation of the JCO is normally proceduralized through the existing plant
record system, which is auditable.

4.6    Reasonable Assurance of Safety

For SSCs that are not expressly subject to TS and that are determined to be
inoperable, the licensee should assess the reasonable assurance of safety.  If
the assessment is successful, then the facility may continue to operate while
prompt corrective action is taken.  Items to be considered for such an
assessment include the following:

       .    Availability of redundant or backup equipment
       .    Compensatory measures including limited administrative controls
       .    Safety function and events protected against
       .    Conservatism and margins, and
       .    Probability of needing the safety function.
       .    PRA or Individual Plant Evaluation (IPE) results that determine how
            operating the facility in the manner proposed in the JCO will impact
            the core damage frequency.

4.7    Evaluation of Compensatory Measures

In its evaluation of the impact of a degraded or nonconforming condition on
plant operation and on operability of SSCs, a licensee may decide to implement
a compensatory measure as an interim step to restore operability or to
otherwise enhance the capability of SSCs until the final corrective action is
complete.  Reliance on a compensatory measure for operability should be an
important consideration in establishing the "reasonable time frame" to
complete the corrective action process.  NRC would normally expect that
conditions that require interim compensatory measures to demonstrate
operability would be resolved more promptly than conditions that are not
dependent on compensatory measures to show operability, because .                                                              

Attachment 1
                                                              GL 91-18, Revision 1
                                                              October 8, 1997
                                                              Page 10 of 14

such reliance suggests a greater degree of degradation.  Similarly, if an
operability determination is based upon operator action, NRC would expect the
nonconforming condition to be resolved expeditiously.  

On July 21, 1997, the Nuclear Energy Institute (NEI) submitted to the NRC a
guidance document, NEI 96-07 [Final Draft], "Guidelines for 10 CFR 50.59
Safety Evaluations."  Part of this guidance relates to applicability of 10 CFR
50.59 to degraded and nonconforming conditions.  With respect to the use of
compensatory measures, the guidance states:

       .    If an interim compensatory action is taken to address the condition
            and involves a procedure change or temporary modification, a 10 CFR
            50.59 review should be conducted and may result in a safety
            evaluation.  The intent is to determine whether the compensatory
            action itself (not the degraded condition) impacts other aspects of
            the facility described in the SAR.

The staff concludes that this is an acceptable approach for dealing with
compensatory actions within the context of a corrective action process.

In considering whether a compensatory measure may affect other aspects of the
facility, a licensee should pay particular attention to ancillary aspects of
the compensatory measure that may result from actions taken to directly
compensate for the degraded condition.   As an example, suppose a licensee
plans to close a valve to isolate a leak.  Although that action would
temporarily resolve the leak, it has the potential to affect flow distribution
to other components or systems, may complicate required operator responses, or
could have other effects that should be evaluated before the compensatory
measures are implemented.  In accordance with 10 CFR 50.59, should the
evaluation determine that implementation of the compensatory action itself
would involve a TS change or an unreviewed safety question 
(USQ), NRC approval, in accordance with 10 CFR 50.90 and 50.92, is required
prior to implementation of the compensatory action.

4.8    Final Corrective Action

The responsibility for corrective action rests squarely on the licensee.  A
licensee's range of corrective action could include (1) full restoration to
the SAR-described condition, (2) NRC approval for a change to its licensing
basis to accept the as-found condition as is, or (3) some modification of the
facility other than restoration to the original FSAR condition.   If
corrective action is taken so that the degraded or nonconforming condition is
restored to its original configuration, no 10 CFR 50.59 evaluation is
required.  The 10 CFR 50.59 process is entered when the final resolution to
the degraded or nonconforming condition is to be different than the
established FSAR requirement.  At this point, the licensee is planning (in a
prospective sense) to make a change to the facility or procedures as described
in the SAR.  The proposed change is now subject to the evaluation process
established by 10 CFR 50.59.  A change can be safe, but can still require NRC
approval.  The proposed final resolution can .                                                              


Attachment 1
                                                              GL 91-18, Revision 1
                                                              October 8, 1997
                                                              Page 11 of 14

be under staff review and not affect the continued operation of the plant,
because interim operation is being governed by the processes of the
operability determination and corrective action of Appendix B.

In two situations, the identification of a final resolution or final
corrective action would trigger a 10 CFR 50.59 evaluation, unless another
regulation applies (i.e., 10 CFR 50.55a): (1) when a licensee decides to
change its facility or procedures to something other than full restoration to
the FSAR-described condition, as the final corrective action, or (2) when a
licensee decides to change its licensing basis as described in the SAR to
accept the degraded or nonconforming condition as its revised licensing basis. 
This guidance is consistent with the July 21, 1997, revision of NEI 96-07.

       Change to Facility or Procedures

       The first circumstance is if the licensee plans for its final resolution
       of the degraded or nonconforming condition to include other change(s) to
       the facility or procedures in order to cope with the (uncorrected,
       including only partially corrected) nonconforming condition.  Rather
       than fully correcting the nonconforming condition, the licensee decides
       to restore capability or margin by another change.  In this case, the
       licensee needs to evaluate the change from the SAR-described condition
       to the final condition in which the licensee proposes to operate its
       facility.  If the 10 CFR 50.59 evaluation concludes that a change to the
       TS or a USQ is involved, a license amendment must be requested, and the
       corrective action process is not complete until the approval is
       received, or other resolution occurs.

       Change to Current Licensing Basis

       The other situation is a final resolution in which the licensee proposes
       to change the current licensing basis to accept the as-found
       nonconforming condition.  In this case, the 10 CFR 50.59 evaluation is
       of the change from the SAR-described condition to the existing condition
       in which the licensee plans to remain (i.e., the licensee will exit the
       corrective action process by revising its licensing basis to document
       acceptance of the condition).   If the 10 CFR 50.59 evaluation concludes
       that a change to the TS or a USQ is involved, a license amendment must
       be requested, and the corrective action process is not complete until
       the approval is received, or other resolution occurs.  In order to
       resolve the degraded or nonconforming condition without restoring the
       affected equipment to its original design, a licensee may need to obtain
       an exemption from 10 CFR Part 50 in accordance with 10 CFR 50.12, or
       relief from a design code in accordance with 10 CFR 50.55a.  The use of
       10 CFR 50.59, 50.12, or 50.55a in fulfillment of Appendix B corrective
       action requirements does not relieve the licensee of the responsibility
       to determine the root cause, to examine other affected systems, or to
       report the original condition, as appropriate..                                                              
       
       
Attachment 1
                                                              GL 91-18, Revision 1
                                                              October 8, 1997
                                                              Page 12 of 14

In both of these situations, the need to obtain NRC approval for a change
(e.g., because it involves a USQ) does not affect the licensee's authority to
operate the plant.  The licensee may make mode changes, restart from outages,
etc., provided that necessary equipment is operable and the degraded condition
is not in conflict with the TS or the license.  The basis for this position
was previously discussed in Section 4.5.1.

ENFORCEMENT 

If the licensee, without good cause, does not correct the nonconformance at
the first available opportunity, the staff concludes that the licensee has
failed to take prompt corrective action and, thus, is in violation of 10 CFR
Part 50 Appendix B (Criterion XVI). When the NRC concludes that corrective
action to implement the final resolution of the degraded or nonconforming
condition is not prompt, or that the operability determination is not valid,
enforcement action (Notice of Violation, orders) will be taken.  Enforcement
action may include restrictions on continued operation.

Implementation of complete corrective action within a reasonable time frame
does not mitigate the potential for taking enforcement action for the root
causes that initially created the degraded or nonconforming condition or for
violations of other regulatory requirements.  The nonconforming condition may
have resulted from (1) earlier changes performed without a 10 CFR 50.59
evaluation or (2) inadequate reviews; or may be a de facto change for which
the facility never met the SAR description.  The staff may determine that the
"change" from the FSAR-described condition to the discovered nonconforming
condition involved a USQ (or a TS change), and that enforcement action is
appropriate for the time frame up to time of discovery.

5.0    REFERENCE

See attached charts titled, "Resolution of Degraded and Nonconforming
Conditions."


END.The figures for Attachment 1 are currently not available.  
Page Last Reviewed/Updated Friday, June 28, 2013