Trends and impact of prudence challenges on operating nuclear plants

Conference · Wed Nov 01 04:00:00 EST 1989 · Transactions of the American Nuclear Society; (United States)

OSTI ID:5490324

Hoke, II, J R ^[1]

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1. Richard Metzler Associates, Northbrook, IL (USA)

Although the concept and standard for prudence associated with capital investments were first defined by U.S. Supreme Court Justice Brandeis in 1923, prudence reviews have become a growing phenomenon within the electric utility industry over the past decade. These examinations were primarily initiated by state public utilities commissions (PUCs) in response to public and political pressure in the evaluation of delays, cancellations, and cost overruns associated with large nuclear construction projects. The early application of the prudence standard was intended to be, not so much a part of the normal means of regulatory oversight, but a specific review of the management process that could not be adequately addressed within the existing regulatory framework. Since these initial construction reviews, however, the regulators have found the prudence examination to be an effective regulatory tool to evaluate other utility functions, operations, and projects. The broadening in application and scope of these reviews has introduced a new and growing dimension of concern for utility management. The primary target for prudence challenges has been the utility's decision-making process, which typically has not been well defined or documented. This paper briefly presents the trends and issues of prudence within the nuclear industry to date, the form and focus of future examinations, and the strategic measures to prepare for these preemptive challenges.

• OSTI ID: 5490324
• Report Number(s): CONF-891103--
• Conference Information: Journal Name: Transactions of the American Nuclear Society; (United States) Journal Volume: 60
• Country of Publication: United States
• Language: English

Related Subjects

21 SPECIFIC NUCLEAR REACTORS AND ASSOCIATED PLANTS
210700 -- Nuclear Power Plants-- Regulation & Licensing
210800* -- Nuclear Power Plants-- Economics
29 ENERGY PLANNING, POLICY, AND ECONOMY
290600 -- Energy Planning & Policy-- Nuclear Energy
CAPITALIZED COST
CONSTRUCTION
COST
DECISION MAKING
DOCUMENTATION
ELECTRIC UTILITIES
IMPLEMENTATION
INSTITUTIONAL FACTORS
MANAGEMENT
NATIONAL ORGANIZATIONS
NUCLEAR FACILITIES
NUCLEAR POWER PLANTS
OPERATION
PERFORMANCE
PLANNING
POLITICAL ASPECTS
POWER PLANTS
PROCUREMENT
PUBLIC OPINION
PUBLIC UTILITIES
REACTOR OPERATION
REGULATIONS
THERMAL POWER PLANTS
US DOE
US NRC
US ORGANIZATIONS