1. Greg Galletti Quality Electrical Vendor Branch Office of New Reactors U.S. NRC 1 NUPIC General Membership and Vendor Meetings June 2014

2. Insights from the Fukushima Event 2014 NRC Vendor Inspections Recent Inspection Results Update on Current initiatives A plug for Safety Culture 2

3. Wyle Laboratory– 1/2014* Rosemount Nuclear Instruments – 1/2014 Westinghouse - 3/2014* Enersys– 3/2014* Chicago Bridge & Iron – 3/2014* Pentair Valves and Controls - 3/2014* Westinghouse – 4/2014* Wyle Laboratory – 4/2014* United Controls International – 4/2014 C&D Technologies - 4/2014 Specialty Maintenance and Construction, Inc. – 4/2014 Steris Isomedix Services – 4/2014 Carolina Energy Solutions – 5/2014* RSCC Wire & Cable LLC– 5/2014 Curtis-Wright EMD – 6/2014 Doosan – 7/2014 * AP-1000 testing, design, or fabrication RELEASED REPORTS 3

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5. Most Common issues: Design Control Instruction, Procedures, Drawings Nonconformances Corrective Actions Part 21 Important Insights Recent observations from NRC inspections identified potential the lack of challenges to the assumptions and/or analyses for: 1. Justifying suitability of equipment, 2. Evaluations for part 21 applicability. 3. The translation of high level design commitments into detailed design documentation. Two recent cases of NRC challenging vendor’s equipment qualification (EQ) evaluations or testing activities due to lack of rigor or lack of adequate justification for conclusions. Third case where a vendor failed to adequately identify and document design requirements While the NUPIC Audit process and other industry assessments (such as vendor sub- supplier oversight activities) did not identify such issues 5

6. Summary: NRC continues to perform technically-focused inspections of vendors that evaluate the detailed design, procurement, fabrication, and testing of SR SSCs. Staff continues to identify issues associated with evaluations and analyses to support acceptance of or the suitability of items Findings reflect assessment beyond basic confirmation that the vendor has a QA program consistent with regulatory requirements which challenges the implementation of that program Findings also emphasize the value of performing inspections directly at the facilities, witnessing work in progress, and sampling the supplier’s assessments and analyses. 6

7. NRC Observation of NUPIC Audits and Findings No Direct Audit Observations to date in FY 2014 Two are tentatively scheduled for: Nuclear Power Services – CEG the week of 8/25 IHI Southwest Technologies – CEG the week of 9/15 Tyco Electronics - a limited scope audit Southern Company – TBD 7

8. 10 CFR Part 21 Rulemaking Activities Update* 8 MilestonesTarget Date SECY-11-0135, “Staff Plans to Develop Regulatory Basis for Clarifying the Requirements in 10 CFR Part 21….” September 29, 2011 Initial Draft Regulatory Basis Published for Comment December 2012 Final NMSS Site Visit at Fuels FacilitiesSeptember 27, 2013 NMSS Public Meeting to Include Potential Solutions to Policy Issues March 6, 2014 Begin Concurrence of Revision 1 to the Draft Regulatory Basis March 31, 2014 Release Revision 1 to the Draft Regulatory Basis (includes clarification of key terms and introduces a separate section for CGD) June 6, 2014 Update Provided by Staff at NRC WorkshopJune 12, 2014 Public Meetings to Discuss Regulatory BasisSummer 2014 Finalize Regulatory BasisSeptember 2014 Proposed Rule with draft guidesSeptember 2015 Final RuleDecember 2016 * http://www.nrc.gov/reactors/new- reactors/oversight/quality-assurance/part- 21-rulemaking.html

9. More on the Procurement Initiative NRC Vendor Inspections identify commercial grade dedication (CGD) issues at many of the vendors inspected 1. In FY 2012, 27 vendor inspections were conducted with 60 findings. 40% off those dealt with CGD issues 2. In FY 2013 16 inspections with Design Control issues with approximately 43 findings. 30% off those dealt with CGD issues Inspections: The inspection will be conducted following Inspection Procedure IP 43004 “Inspection of Commercial Grade Dedication Programs”, which was revised to integrate IP 38703 The inspection are conducted by three to four inspectors for one week onsite. Site Selection: Completed initial inspection at Oconee (Documented in Residents quarterly report). Next inspection – River Bend Station June 2014 Current Results: Oconee identified weaknesses in their CGD packages, noting approximately 75% did not have the documentation to show they meet the requirements of 10 CFR Part 21 and 10 CFR Part 50 Appendix B. However, utility was able to provide documented evidence showing reasonable assurance in each of their noted weaknesses. NRC identified similar issues. 9

10. Revision of NUREG-0800 Standard Review Plan Section 17.5 NRC staff guidance for the review of applications for Design Certification, Early Site Permits, and Combined Operating Licenses Current Revision dates to March 2007 and is based on: 1. ASME Standard NQA-1 1994 Edition 2. Regulatory Guide (RG) 1.8 “Qualification and Training of Personnel for Nuclear Power Plants,” Revision 3, 3. RG 1.28, “Quality Assurance Program Requirements (Design and Construction),” Revision 3, 4. RG 1.33, “Quality Assurance Program Requirements (Operation),” Revision 2, 5. and NRC Review Standard (RS)-002, “Processing Applications for Early Site Permits.” Major enhancements in the revised version 1. Reference RG 1.28 Revision 4, dated June 2010, which endorses the use of NQA-1-2008 Edition and the 2009-1a addenda, and 2. Reference RG 1.33 Revision 3, dated June 2013, which endorses ANSI/ANS 3.2-2012 Edition. The staff expects to issue SRP 17.5 for public comment by the end of May 2014. 10

11. Commercial Calibration Services* 11 MilestonesTarget Date NRC initial recognition of accreditation by ILAC MRA signatories documented Arizona Public Service Safety Evaluation September 28, 2005 NRC letters recognizing additional U.S.-based accreditation Bodies for commercial calibration services 2007-2008 Request by ENSA for recognition of International accreditation bodies of ILAC for commercial calibration services February26, 2009 NRC observes several Domestic Accreditation Bodies performing assessments of calibration labs to International Standard Organization (ISO)/International Electro-technical Commission (IEC) 17025, “General Requirements for the Competence of Testing and Calibration Laboratories.” May – October 2010 NEI and NRC staff conducted an observation of the Asia-Pacific Laboratory Accreditation Cooperation’s (APLAC) evaluation of Japan Accreditation Board (JAB) both calibration and testing facilities November 2013 Nuclear Energy Institute (NEI) submits guideline NEI 14-05, Revision 0, “Guidelines for the Use of Accreditation in Lieu of Commercial Grade Surveys for Procurement of Laboratory Calibration and Testing Services,” for NRC review and endorsement April 29, 2014 Current plan is for NRC to review and issue a Safety Evaluation Report (SER) on NEI 14-05 and subsequently develop a Regulatory Issue Summary (RIS) Target Dec. 2014 Update provided by NRC staff at NRC workshopJune 12, 2014 *http://www.nrc.gov/reactors/new- reactors/oversight/quality-assurance/qual-assure- safety.html#calibr

12. EPRI 5652: (NP-5652 + TR 102260) CGI Dedication March 2014 – NRC participated in 8 th CGID guidance revision technical advisory committee (TAG) meeting – Charlotte, NC Purpose to finalize work on revision to EPRI guideline The TAG performed a final walk through related to the dedication of various types of commercially procured services. The TAG also continued discussion on the meaning of “designed and manufactured as a basic component as it relates to determining if an item should be subject to the commercial grade dedication process or controlled under the auspices of a QA program that complies with 10CFR50, Appendix B. The discussion led to a review of how to correctly interpret related definitions in 10CFR50, Appendix B and 10CFR, Part 21. Most recent meeting held May 27-30, 2014 12

13. EPRI 1025243 Software Dedication 13 MilestonesTarget Date Received NEI letter and submittal of EPRI 1025243, “Plant Engineering: Guideline for the Acceptance of Commercial-Grade Design and Analysis Computer Programs Used in Nuclear Safety-related Applications” July 18, 2012 NRC issued 6 RAIs related to EPRI 1025243 to NEIFebruary 27, 2013 NRC meets with NEI/EPRI to discuss status of Document May 2013 NRC received formal response from NEI and Revision 1 of document January 22, 2014 NRC completed development of Draft RG 1305 and associated regulatory analysis to endorse guideline May 2014 Internal NRC reviewIn-process Draft RG To be posted to the Power Reactor (Division 1) section of NRC public website for 60 day public comment period Expected 2014

14. Multi-national initiative to leverage resources and knowledge of national regulatory authorities tasked with regulatory design review for new reactors. Vendor Inspection Cooperation working Group (VICWG) focused on evaluating opportunities to maximize the use of results from international regulator efforts at Vendor facilities 1. Development of a common QA/QC criteria document for use by multi-national regulatory bodies conducting joint inspections 2. Develop an inspection protocol for implementation of multi- national inspections 3. Completion of several inspection with support by international regulators (both domestically and abroad) 4. First multi-national inspection scheduled for July 2014 using protocol and common CA/CQ criteria document *– Valinox, Montbard, France (SG Tube manufacturer) * http://www.oecd-nea.org/mdep/working-groups/vicwg.html 14 Multi-National Design Evaluation Program (MDEP)*

15. Counterfeit, Fraudulent and Suspect Items (CFSI) 15 MilestonesTarget Date NRC inspections and issuance of several generic communications related to non-conforming materials identified in industry 1987-88 ERPI publishes NP-5652, “Guideline for the Utilization of Commercial Grade Items in Nuclear Safety Related Applications (NCIG-07)” June 1988 NRC issues Generic Letter 89-02, “Actions to Improve the Detection of Counterfeit and Fraudulently Marketed Products.” Mar. 21, 1989 NRC issues Generic Letter 91-05, “Licensee Commercial-Grade Procurement and Dedication Programs,” April 9, 1991 NRC issues Information Notice IN-2008-04, “Counterfeit Parts Supplied To Nuclear Power Plants,” which acknowledged several recent incidents of CFSI that were of concern to the NRC Apr. 7, 2008 NRC issues SECY-11-0154, “An Agencywide Approach to Counterfeit Fraudulent, and Suspect Items” consisting of 19 Planned actions to address 24 identified issues Oct. 28, 2011 Multiple public meeting between NRC and stakeholders on NRC and Industry initiatives to address CFSI 2012-2013 NEI submits letter to NRC informing of plans to publish updated EPRI guidance for CFSI by July 2014 April 14, 2014 NRC provides comments back to NEI on Draft guidanceMay 2014

16. Ongoing Communication Outreach http://nrcweb.nrc.gov:400/reactors/new-reactors/oversight/quality-assurance/vendor-insp/vendor- newsletters.html 2013 Annual Vendor Newsletter is now available on our public website at the below link. Topics of interest include news on Commercial Grade Dedication Activities and Findings, Updated Inspection Procedures and Guidance, Update to Regulatory Guide 1.33, Quality Assurance Program Requirements (Operation),” Vendor Inspection Plan Updates, and the fourth Workshop on Vendor Oversight for New Reactor Construction http://www.nrc.gov/reactors/new-reactors/oversight/quality-assurance/qual-assure-faqs.html The Frequently Asked Questions FAQ page addresses Quality Assurance for New Reactors and currently has three main categories: 10 CFR Part 21 FAQs, Commercial Grade Dedication FAQs, and Enforcement FAQs. http://www.nrc.gov/reactors/new-reactors/oversight/quality-assurance/nonconformances-violations.html This page is to serve as a categorization tool and provides a list of all applicable QA Inspections for New Reactor Licensing and Vendor QA Inspection reports that have either a Notice of Nonconformance (NON) or Notice of Violation (NOV) within a specific criterion of 10 CFR 50 Appendix B or 10 CFR Part 21 related issue. http://pbadupws.nrc.gov/docs/ML1200/ML12006A008.pdf This link describes the vendor inspection program (VIP). http://nrcweb.nrc.gov:400/reactors/new-reactors/oversight/quality-assurance/vendor-insp.htmlhttp://nrcweb.nrc.gov:400/reactors/new-reactors/oversight/quality-assurance/vendor-insp.html. http://nrcweb.nrc.gov:400/reactors/new-reactors/oversight/quality-assurance/vendor-insp/vendor- reg-form.html These Links provide access to the Recent NRC RIS 2014-07, “ ENHANCEMENTS TO THE VENDOR INSPECTION PROGRAM - VENDOR INFORMATION REQUEST” and the Vendor Registration Form. 16

17. The Commission defines Nuclear Safety Culture as the core values and behaviors resulting from a collective commitment by leaders and individuals to emphasize safety over competing goals to ensure protection of people and the environment. (1) 17 (1)http://www.nrc.gov/about-nrc/regulatory/enforcement/safety- culture.htmlhttp://www.nrc.gov/about-nrc/regulatory/enforcement/safety- culture.html

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