The St. Petersburg Times ran an excellent investigative piece by Ivan Penn yesterday:
Had James Terry’s idea worked, it would have saved Progress Energy $15 million.
But it didn’t, and the consequences are staggering: $2.5 billion.
Progress customers will have to pay about a fourth of that.
The utility wanted to replace aging steam generators inside the thick, concrete containment building at its Crystal River nuclear power plant. The work is complex and costly.
Two companies bid on the Crystal River job. They were the only two companies that had any experience managing similar upgrades, and between them they had completed 34, all successfully.
The low bid: $81 million.
Terry, Progress’ major projects manager, thought he had a better idea.
“It seemed, in my mind, that there was an opportunity . . . to lower the cost up to the point . . . that we would exclude the contractor and self-manage,” Terry would later testify.
Top Progress Energy officials adopted his do-it-yourself plan.
In eschewing the expertise of the two companies that had managed every other similar steam generator replacement project in the United States, Progress became the first utility to manage the cutting of a nuclear plant containment wall on its own.
The utility did the job differently from the way it had been done in similar jobs elsewhere. And after workers used this different procedure at Crystal River, the building that shields the nuclear reactor cracked.
There was no radiation leak. But the nuclear plant has been out of service for two years. It won’t generate a kilowatt of power for at least two more years. There’s a chance it will never be repaired.
“It was crazy for a utility to be so arrogant to think they could take on this project,” said author and physicist Kenneth Bergeron of the Sandia National Laboratories, who spent 25 years managing research on nuclear reactor safety.
“You’ve got executives of a utility overreaching with other people’s money.”
Penn compared the costs to a better known accident:
The reactor meltdown at Three Mile Island in 1979 was far more serious, but just a little more costly, $2.6 billion in today’s dollars, according to the Insurance Information Institute.
Progress Energy’s decision to handle the steam generator replacement led to a serious safety situation:
In the 34 similar jobs, experts have moved things in and out in two ways. One is to use the hatch that is part of the containment building. The other is to cut a hole in the side of the building, which had been done at least 13 times, always successfully.
At Crystal River, Progress president Bill Johnson accepted a recommendation that cutting a hole would be less complicated and less expensive than using the hatch.
But in 2009, when workers cut into the 42-inch-thick wall of the Crystal River containment building, it cracked, creating what Progress officials call a “delamination.”
The matter now goes to the Florida Public Service Commission:
On Monday, Progress Energy is expected to file its initial testimony on the Crystal River case with the state Public Service Commission, which is investigating.
“It is in effect a complex construction negligence case,” said J.R. Kelly, the state public counsel, who represents consumers before the commission. “It is unlike anything that has come before the PSC. It is a case that has never occurred anywhere on Earth.”