By John Stang
Holtec International’s founder and top executive lashed out earlier this month at a California citizens advisory panel that criticized its work at the retired San Onofre Nuclear Generating Station (SONGS).
President and CEO Kris Singh was responding to an April 8 memo by the three top members of the SONGS Community Engagement Panel to plant majority owner Southern California Edison (SCE) regarding the troubled operation to move used reactor fuel into dry storage.
Holtec is the lead contractor for the project, which has been stalled for nine months following an August 2018 mishap in placing one spent-fuel canister into its underground storage slot. Southern California Edison has already paid a $116,000 federal penalty for the incident, which has been blamed on problems in training, procedures, and management in moving the fuel.
There is still no schedule to restart offloading the spent fuel, which would require authorization from the U.S. Nuclear Regulatory Commission, said SCE spokesman John Dobken.
“We are increasingly concerned about a key variable in the process: Holtec,” CEP Chairman David Victor, Vice Chairman Dan Stetson, and Secretary Jerry Kern wrote in the memo to Pedro Pizarro, president and CEO of SCE parent Edison International, and other company executives.
The three-page memo highlights three concerns about Holtec’s operations and governance, which did not sit well with Singh.
“Your memo is very much in the tradition of irresponsible claptrap that dominates your CEP meetings,” he wrote in a letter emailed to Victor on May 4. “An inflammatory memo unsupported by facts is little more than a hatchet job.”
The Orange County Register first reported this exchange on Wednesday.
The Community Engagement Panel, established by SCE, is intended to ensure “open communication, public involvement and education” for decommissioning at the San Diego County site following its permanent closure in 2013. Victor, Stetson, and Kern serve as its Executive Committee.
Their lead concern was what the three characterized as Holtec’s failure to learn from prior fuel offloading operations in its work at SONGS. Holtec failed to anticipate the complexity of the California job, which involves moving 73 canisters of spent fuel assemblies from the reactor Units 2 and 3. Forty-four of those remain to be relocated.
Meanwhile, the Nuclear Regulatory Commission in April found Holtec had violated federal regulations in updating the design of a spent fuel storage cask that had been used in the SONGS contract. The probe led from a 2018 incident in which a broken pin was found at the bottom of a fuel canisterwaiting to be filled with fuel assemblies. The agency, though, did not fine Holtec, noting it had addressed the problems identified in the investigation.
Another issue has been scratches and abrasions on canisters transferred to dry storage at SONGS, according to the CEP memo. While such scratches are not unexpected, Holtec’s certificate for the canister says there would be none, it adds.
“Such events — in effect, unforced errors — are not acceptable,” according to the Executive Committee. “Along the way, the company’s most senior management has been tone deaf in how it deals with the public. We are concerned that they do not understand that trust and sustained competence are everything in this industry.”
Also, the three voiced concerns regarding the “opaque” nature of corporate governance at Holtec, an energy technology company based in Camden, N.J. No more than one of the six members of Holtec’s Board of Directors “has both independence and related industry experience needed to provide the kind of oversight functions one expects from a Board,” according to Victor, Stetson, and Kern.
Finally, the three said Holtec is branching into businesses beyond its core engineering expertise. These new ventures require additional management skills in highly public and regulated environments, which the CEP leaders question Holtec is ready for.
They specifically cited Holtec’s work in developing small modular reactors and plans to purchase at least four retired or soon-to-close nuclear power plants for decommissioning.
Holtec plans to contract the decommissioning and spent fuel management for the facilities in New Jersey, New York, Michigan, and Massachusetts to Comprehensive Decommissioning International, its new joint venture with Montreal-based engineering and construction company SNC-Lavalin.
The CEP Executive Committee asked Edison management to provide additional information regarding improvement to the fuel offloading program at SONGS and regarding “how Holtec’s management is changing.”
’These problems strike us as completely solvable— with the key solutions perhaps already in hand — but helping the community to understand what (SCE) and Holtec are doing is crucial,” according to the memo. “Among other things, it is important for shifting from an antagonistic relationship with Holtec — as exists in many parts of the community — — to one that is anchored in the understanding that it is in everyone’s interest to have effective management and stronger trust.”
In his response, Singh criticized the CEP for allegedly not reading the New Jersey company’s corporate governance documents. The remarks in the CEP’s memo exceeded what is allowed in its charter, he wrote.
“It is truly a sad spectacle, because, if led properly, the CEP could play a valuable educational role to help the local people understand the issues,” Singh stated. “Instead your memo is crafted to sow doubt in the minds of the local people about the competence of the only company that can carry out such work! Given that underground storage in UMAX is the universally-agreed safest solution, do your efforts to undermine Holtec serve public interest or sabotage it.”
In an April 24 letter to the CEP Executive Committee, Southern California Edison Vice President Doug Bauder offered a more measured response. “SCE has implemented significant corrective actions to include enhanced oversight of Holtec’s activities at SONGS. … It is my belief that Holtec also fully understands the importance of getting the job done safely and correctly.”
These measures include SCE reviewing — with third-party experts — all of Holtec’s processes and procedures for the fuel offload project. The utility’s oversight personnel are receiving detailed technical training on Holtec’s systems. Transparency will be increased with both workers and the public. An agreement has been reached with Holtec to keep commercial issues away from the on-site operations of fuel movement, Bauder wrote.
He added that Holtec has provided a veteran project executive director who will remain at SONGs until the fuel movement is complete. Holtec has also conducted in-depth training programs for project workers, according to Bauder.
The CEP, Holtec, and SCE showed no interest Thursday in elaborating on the dispute.
“I’m quite focused on the future and on a successful (fuel movement) program. I don’t really see a lot of value in playing ping-pong with this company, especially given their response so far,” Victor, director of the Laboratory on International Law and Regulation at the University of California, San Diego, wrote in an email.
Dobken wrote: “We appreciate the efforts of the Community Engagement Panel to highlight areas of concern in a thoughtful, constructive manner. As a result of our causal reviews and a robust risk assessment, significant process enhancements, the introduction of additional technology and enhanced oversight measures, we are confident that fuel transfer operations can continue successfully. The Nuclear Regulatory Commission, after multiple inspections, has found the corrective actions by SCE and our contractor to be appropriate.”
In another email, Holtec Vice President of Business Development and Communications Joy Russell said: “Holtec remains committed to safety in all we do and will continue to work with Southern California Edison and the Nuclear Regulatory Commission to ensure that fuel transfer operations can continue successfully at the San Onofre nuclear plant.”
