In the latest installment of NRC’s changes to its guidance on backfitting on May 29, the Commission approved the Staff’s proposed revisions to Management Directive (MD) 8.4, previously titled, “Management of Backfitting, Issue Finality, and Information Collection” and its companion Directive Handbook (DH). As a result of content changes (discussed herein), the title of these directives has now been modified to also provide guidance for the “forward-fitting” requirements for 10 CFR Part 52 licensees by including its analogous terms for Backfitting, “forward fitting and issue finality.” As such, NRC guidance on Backfitting is now called “Management of Backfitting, Forward Fitting, issue Finality, and Information Requests.”
These backfitting modifications reflect several years of incremental adjustments in the NRC’s handling of backfit claims to bring Staff actions more consistently in line with the Backfit Rule (10 CFR § 50.109). NUREG 1409, “Backfitting Guidelines,” which was published in June 1990, also will require modification by the NRC prior to its issuance of the subject guidelines to ensure regulatory consistency.
Recall that the NRC cannot impose a backfit unless it demonstrates in a backfit analysis that the action will provide a substantial increase in the overall protection of the public health and safety and that the direct and indirect costs of implementing the backfit action are justified by the increased protection. However, certain circumstances allow the NRC to impose a backfit without a cost-benefit analysis if one of three cost-benefit exceptions apply. The exceptions to the backfit rule cost-benefit analysis requirement are: (1) modifications necessary to bring a facility into compliance with its license or into conformance with written commitments by the licensee; (2) actions necessary to ensure adequate protection; or (3) actions that involve defining or redefining what constitutes adequate protection.
In the past, the NRC heavily relied on one exception to the backfit/cost-benefit analysis preparation requirement, the so-called “compliance exception,” to allow facility-specific backfits without the need for the NRC to prepare a cost-benefit analysis. As a result of a successful appeal by a licensee in 2016, the NRC’s use of this exception was called into question. Therefore, on June 9, 2016, the Executive Director of Operations, in response to the licensee’s successful backfit order appeal and industry input, directed the Committee to Review Generic Requirements to, among other things, assess backfit requirements, guidance, and criteria for adequacy and consistency of implementation. Please refer to our previous blogs on this topic.
The Staff submitted its draft revisions of MD 8.4 and DH 8.4 in April 2018 and the Commission has now approved key changes to NRC backfit guidelines, including:
- Direct inclusion of “forward fitting” backfit-related criteria applicable to 10 CFR Part 52 licensees in MD/DH guidelines.
- If the NRC is considering a backfitting action, it must first consider whether the action is necessary to ensure adequate protection of public health and safety and if so, whether there is an imminent threat to public health and safety. If the action is found to be necessary to ensure adequate protection, a backfit analysis is not required, and costs cannot be considered (unless the NRC staff identified more than one means for implementing the new requirement, in which case costs could be considered in deciding which approach is appropriate).
- Before the Staff uses the compliance exception, it must have already determined that the issue does not involve adequate protection. (Note that use of the compliance exception remains limited to situations involving “omission or mistake of fact” defined as when NRC staff, whether by its own error or by licensee or third-party error or omission at or before the time of determination, incorrectly perceived facts, performed or railed to recognize flawed analyses, or failed to draw inferences from those facts or analyses as judged by the standards and practices prevailing at the relevant time of the determination in question. It does not include NRC Staff changing its mind regarding what constitutes compliance. The compliance exception should not be applied to the failure of the NRC Staff to extrapolate conclusions from facts, analyses, and direct inferences in ways that not commonly recognized at the time of NRC determination or recharacterizations of a particular set of otherwise understood circumstances satisfies stands based on standards and practices developed after the time of determination.)
- For all non-adequate protection backfitting, at least some consideration of cost is necessary.
The Commission’s approval is subject to the Staff’s incorporation of the Commission’s comments and edits, and after those edits are incorporated, the Staff will issue the final revised version of MD 8.4 and DH 8.4. We will continue to track this matter and will provide additional updates and analysis when the NRC issues the final version of these documents.