Horizon NSL Pre-Application Intervention Strategy

CIVIL NUCLEAR REACTOR PROGRAMMME NEW REACTOR LICENSING HORIZON NUCLEAR POWER COMPANY LIMITED S APPLICATION FOR A NUCLEAR SITE LICENCE TO INSTALL AND OPERATE TWO ADVANCED BOILING WATER REACTOR UNITS AT WYLFA OFFICE FOR NUCLEAR REGULATION PRE-APPLICATION INTERVENTION STRATEGY Office for Nuclear Regulation Page 1 of 14

OFFICE FOR NUCLEAR REGULATION CIVIL NUCLEAR REACTOR PROGRAMMME Project: Title: New Civil Reactor Build TRIM Ref: 2014/445362 Horizon Nuclear Power Company Ltd s application for a nuclear site licence to install and operate two advanced boiling water reactor units at Wylfa. Pre-application strategy. Office for Nuclear Regulation Page 2 of 14

EXECUTIVE SUMMARY Horizon Nuclear Power Ltd (Horizon) has expressed an intention to apply for a nuclear site licence in 2016 to install and operate two UK Advanced Boiling Water Reactors at the Wylfa Newydd site on Anglesey, North Wales. The Office for Nuclear Regulation s Licensing Nuclear Installations publication provides guidance on the licensing process and the factors that it may take into account when reviewing a nuclear site licence application. This strategy sets out how ONR will engage with Horizon in the period leading up to receiving a formal nuclear site licence application to provide advice on the licensing process and the expectations placed on a licensee. The aim of the early engagement described in this strategy is to enable: ONR to gain confidence in Horizon s development as a potential nuclear site licence holder during the pre-application period. Horizon to develop a nuclear site licence application that meets ONR s expectations as set out in published guidance. ONR will appoint workstream leads who will use the intervention strategy described in this document to scope out their respective interactions with Horizon. These will be based on five groups covering organisational capability, site licence compliance, safety case, security, and licensing, legal and safeguards. These interventions should enable ONR to make an informed judgement of the adequacy of Horizon s arrangements and advise Horizon of its readiness to apply for a nuclear site licence. Office for Nuclear Regulation Page 3 of 14

SECTION CONTENTS PAGE 1 Introduction 5 2 Pre-application organisation and project governance 6 2.1 Project philosophy 6 2.2 Project organisation, roles and responsibilities 8 2.3 Project governance 8 3 Interventions 9 3.1 Organisational capability 9 3.2 Site licence compliance 10 3.3 Safety case 11 3.4 Security 11 3.5 Licensing, legal and safeguards 12 3.5.1 Security of tenure 12 3.5.2 Consultation with Natural Resources Wales 12 3.5.3 Consultation with DECC 12 3.5.4 Justification 12 3.5.5 Site map and location details 12 3.5.6 Relationship with the existing Wylfa nuclear power station licensed site 12 3.5.7 Safeguards 13 4 Communication 13 5 Intervention outcome 14 Office for Nuclear Regulation Page 4 of 14

1. INTRODUCTION 1 Horizon has expressed its intention to apply for a nuclear site licence (NSL) in 2016 to install and operate two UK Advanced Boiling Water Reactors (ABWR) at the Wylfa Newydd site on Anglesey, North Wales. 2 ONR s Licensing Nuclear Installations (LNI) publication provides guidance on the licensing process and the factors that it may take into account when reviewing a nuclear site licence (NSL) application. This strategy sets out how ONR will engage with Horizon in the period leading up to receiving a formal NSL application to provide advice on the licensing process and the expectations placed on a licensee. 3 The aim of the early engagement described in this strategy is to enable ONR to gain confidence in Horizon s organisational capability, company structures, governance and procedures, site safety documentation and licence condition compliance arrangements during the pre-application period, and provide advice that will assist Horizon to develop a nuclear site licence application that meets ONR s expectations as set out in published guidance. 4 ONR and Horizon will endeavour to work together in an efficient and effective manner with the aim of Horizon developing a right first time NSL application with suitable underpinning arrangements. 5 This early engagement approach has the advantage of providing Horizon with an early indication of whether its proposed arrangements will meet with ONR s expectations. It will also leverage ONR s regulatory influence and increase the likelihood of a right first time NSL application. 6 With the exception of ONR s powers regarding the protection of Sensitive Nuclear Information, ONR s relationship with Horizon during the pre-application phase is principally advisory rather than regulatory. Horizon has formally requested ONR to provide pre-licence application advice and has entered into a cost-recovery agreement with ONR which allows ONR to charge for this work. Horizon and ONR have also agreed that a Deed will provide ONR with oversight of Horizon s procurement activities for reactor components that will take place in advance of Horizon securing a nuclear site licence. This will commit Horizon to act as though it is already a nuclear site licensee with respect to procurement of long lead items. 7 On receipt of a NSL application, ONR will seek to verify the adequacy of implementation of the arrangements described in the application to inform a decision by the Chief Inspector of Nuclear Installations as to whether Horizon should be granted a NSL. This activity is not covered by this pre-application intervention strategy and will be the subject of a separate nuclear site licensing intervention strategy. Office for Nuclear Regulation Page 5 of 14

2. PRE-APPLICATION PROJECT ORGANISATION AND GOVERNANCE 2.1 Project philosophy 8 Pre-application activities will be managed as a project and project management principles and disciplines will be applied. The project activities are shown schematically in Figure 1 below. ONR Activities Project governance Advice and influence Working level interactions Readiness assessment Acknowledge application Workstreams and groups Organisational Capability Joint interactions Horizon NSL application preparatory activities Site Licence Compliance Safety Case Readiness Review Horizon NSL Application Security NSL Application Dossier Licensing, Legal & Safeguards Start activity April 2014 Complete dossier March 2016 Complete review May 2016 Submit SLA June 2016 Note: all dates are indicative Figure 1 Pre-application project activities 9 The basic requirements for applying for a nuclear site licence are set out in LNI Table 1, Steps 1, 2 and 3. ONR and Horizon have divided these requirements into workstreams to enable effective and efficient engagement between the parties and to enable project management of the licence application activities. Office for Nuclear Regulation Page 6 of 14

10 The workstreams have been grouped commensurate with pre-application engagement activity in accordance with LNI Table 1 to enable effective oversight of common activities. Group Organisational capability Site licence compliance Safety case Security Licensing, legal and safeguards Scope Corporate body/licensee organisation structure, governance arrangements, resources, competence and training, design authority, intelligent customer, internal challenge and procurement. Arrangements to comply with relevant nuclear site licence conditions as well as REPPIR requirements, site decommissioning and radioactive waste management requirements. Site safety documentation and proposals to deliver a schedule of safety submissions leading to a preconstruction safety report (PCSR). Construction and Nuclear Site Security Plans, physical, personnel and information security. Site identification and suitability, security of tenure, generic siting envelope, site boundary definition, prescribed activities, third party consultation and engagement. Euratom requirements. Table 1 Workstream groups and scope 11 ONR will endeavour to advise, guide and, where necessary, influence Horizon during the development of its organisational capability, company structures, governance and procedures, site safety documentation and licence condition compliance arrangements during the pre-application period. It will draw on its previous experience of licensing NNB GenCo, where appropriate, to try to ensure that good practice and lessons learned are shared with Horizon. 12 The workstreams are expected to activate progressively between April and December 2014. The onus is on Horizon to make initial, early engagement with ONR when it considers that it has reasonably developed proposals to share. The Horizon schedule will potentially be at risk if engagement does not commence in a timely manner. 13 Workstream progress will be monitored on a regular basis in accordance with the New Reactor Licensing (NRL) sub-programme, and pre-application project governance arrangements agreed with Horizon (see section 2.3). 14 It is expected that Horizon will develop its organisational capability, company structures, governance and procedures, site safety documentation and licence condition compliance arrangements progressively and proportionately during the preapplication period. These arrangements should be described in the documentation that supports Horizon s NSL application dossier. 15 Horizon has informed ONR that it intends to carry out a readiness review prior to submitting its NSL application. ONR will expect to review and comment on the findings of the readiness review, and on the content and quality of the NSL dossier. 16 ONR will formally acknowledge Horizon s NSL application on receipt. Office for Nuclear Regulation Page 7 of 14

2.2 Project organisation, roles and responsibilities 17 The project organogram is shown in Figure 2 below and key responsibilities are described in paragraphs 18 to 23. Head of New Reactor Licensing (NRL) NRL Project Manager Organisational Capability DMG Lead Site Licence Compliance DMG Lead/Wylfa Newydd Site Inspector Safety Case DMG Lead Security DMG Lead Licensing, Legal and Safeguards DMG Lead Workstream Leads Workstream Leads Workstream Leads Workstream Leads Workstream Leads Figure 2 Project Organogram 18 The Head of NRL is accountable to the Civil Nuclear Reactors Programme (CNRP) Director for leading and directing ONR s New Reactor Licensing sub-programme (Horizon and NuGen licensing). 19 The NRL Project Manager is responsible for developing and maintaining project schedules, allocating resources, project governance (including monitoring project progress and expenditure) to ensure effective delivery of Horizon s pre-application activities. 20 Delivery Management Group (DMG) Leads are responsible for providing leadership and reporting progress for their respective group of workstreams as defined in Table 1. 21 Workstream Leads are responsible for leading working level interactions with Horizon relating to their respective workstreams; 22 ONR s Programme Delivery Support Team, Horizon s Regulatory Interface Team and NRW s Programme Management Office are responsible for co-ordinating workstream interactions between the parties and the production of project management information to enable progress towards NSL application to be monitored. 23 Natural Resources Wales (NRW) is the regulatory authority in Wales for environmental protection and will grant environmental permits (nuclear and non-nuclear) to Horizon under the Environmental Permitting Regulations 2010. NRW will draw heavily on the Environment Agency s experience (albeit in its capacity as a contractor to NRW). ONR, NRW and EA will work together with the aim of promoting efficiency and effectiveness, where there are common areas of interest in relation to their respective licensing and permitting processes. 2.3 Project governance 24 Workstream Leads will identify the scope, outcomes, key interim milestones and resource requirements for their interactions with Horizon and record them in Task Sheets. DMG Leads will present Task Sheets for their workstream groups to the NRL Office for Nuclear Regulation Page 8 of 14

Sub-Programme Board for confirmation that the Task Sheets align with this preapplication intervention strategy, and for endorsement. 25 Working level interactions with Horizon will be recorded using Contact Records. 26 ONR s Programme Delivery Support Team; Horizon s Regulatory Interface Team and NRW s Programme Management Office will develop an Interface Protocol. This document will describe the following arrangements: Co-ordination of workstream interactions between the parties. Provision of management information to enable pre-application progress monitoring. 27 ONR will monitor pre-application progress via the NRL Sub-Programme Board, which is chaired by the Head of New Reactor Licensing, reporting to the CNRP Programme Board. 28 DMG Leads will provide regular progress updates to the NRL Sub-Programme Board which will assure itself of the timely and efficient delivery of pre-application interventions. 29 ONR, Horizon, NRW and EA will jointly monitor NSL pre-application and environmental permitting progress with via a joint Programme Management Meeting. The meetings will: Provide guidance and direction as required. Address matters of concern which cannot be resolved at the working level. Refer decisions made at programme management meetings to joint senior level strategic meetings for endorsement; Act as a coordinating body to ensure that project progress and issues are consistently reported and communicated at all levels of interaction between the parties. 30 The parties will jointly form a view of the adequacy of progress as the pre-application phase progresses and this view may be used by Horizon, as one of a number of criteria, to gauge its readiness to submit a NSL application. 31 ONR s NRL Project Manager will liaise with Horizon s Head of Nuclear Site Licensing and Regulatory Interface Office Manager on a regular basis between formal governance meetings to review and monitor pre-application progress. 3 INTERVENTIONS 3.1 Organisational capability 32 ONR has set out its expectation in LNI that a prospective NSL applicant should establish an organisation that is capable of managing nuclear safety and discharging the obligations associated with holding a nuclear site licence. Key arrangements to demonstrate this organisational capability are: Safety management prospectus Company manual Core capability Employment model Nuclear baseline Intelligent customer Design authority Office for Nuclear Regulation Page 9 of 14

Internal challenge Procurement Horizon NSL Pre-Application Intervention Strategy Competence and training 33 ONR recognises that some of these arrangements may not be fully developed at the point of NSL application and, if so, it will expect Horizon to demonstrate that it has plans in place to achieve an appropriate level of maturity on a timescale commensurate with NSL granting. 34 ONR will engage with, and where necessary, provide advice and guidance to Horizon as part of its philosophy of early engagement with prospective licensees to gain confidence in the adequacy of its arrangements at the point of NSL application. This approach has the advantage of providing Horizon with an early indication of whether its proposed arrangements will meet with ONR s expectations. It will also leverage ONR s regulatory influence and increases the likelihood of a right first time NSL application. 35 Organisational Capability Workstream Leads will identify the scope, outcomes, key interim milestones and resource requirements for their interactions with Horizon and record them in Task Sheets. The Organisational Capability DMG Lead will present Task Sheets for the workstream group to the NRL Sub-Programme Board for confirmation that the Task Sheets align with this pre-application intervention strategy, and for endorsement. 36 The Organisational Capability DMG Lead will report progress to the NRL Sub- Programme Board which will oversee and monitor progress. 3.2 Site licence compliance 37 ONR does not expect Horizon to produce fully developed compliance arrangements for all of the licence conditions (LCs) at the point of NSL application since some of the LCs relate to activities which will not be carried out before NSL granting or will not be carried out for some time after NSL granting. 38 However, ONR considers the following LCs to be applicable to the pre-application phase and it will expect these arrangements to be well developed at the point of NSL application: LC 10 Training LC 12 Suitably qualified and experience persons LC 13 Nuclear safety committee LC 17 Management systems LC 36 Organisational capability 39 The Wylfa Newydd Site Inspector will fulfil the roles of Site Licence Compliance Workstream Lead and DMG Lead. He will engage with Horizon and, where necessary, provide advice and guidance drawing on previous experience of development of LC compliance arrangements with NNB GenCo as appropriate. 40 The Site Licence Compliance Workstream/DMG Lead will identify the scope, outcomes, key interim milestones and resource requirements for interactions with Horizon and record them in Task Sheets. 41 The Site Licence Compliance Workstream/DMG Lead will present Task Sheets for the workstream group to the NRL Sub-Programme Board for confirmation that the Task Sheets align with this pre-application intervention strategy, and for endorsement. 42 The Site Licence Compliance Workstream/DMG Lead will report progress to the NRL Sub-Programme Board which will oversee and monitor progress. Office for Nuclear Regulation Page 10 of 14

3.3 Safety case 43 Horizon has declared its intention to install and operate two UK ABWR units at Wylfa on Anglesey, North Wales. ONR is currently undertaking a Generic Design Assessment (GDA) of the UK ABWR Pre-Construction Safety Report (PCSR). ONR and the requesting party Hitachi-GE have agreed the scope of this assessment which is expected to conclude with a decision on the issue of a Design Acceptance Confirmation (DAC) signalling that the design is licensable in the UK. 44 Horizon has notified ONR that it does not intend to submit a site specific Pre- Construction Safety Report (PCSR) at NSL application, but will submit a plan for the future development of the safety case. 45 It has advised that: Development of the site specific safety case will be heavily dependent on the Generic Design Assessment (GDA) of the UK ABWR. The site specific PCSR will use the GDA PCSR content and structure with site specific topic areas inserted as appropriate and with the GDA PCSR clearly marked to remove any need for re-assessment by ONR. 46 At the time of NSL application, Horizon only needs to demonstrate that there is a high level of confidence that the Wylfa Newydd site can support the activity to be licensed. 47 In order to maximise efficiency and utilise the experience of the UK ABWR GDA team, ONR will draw on the knowledge and expertise of relevant members of its GDA assessment team. GDA assessors will act as Safety Case Workstream Leads for site specific safety case interactions with Horizon during this pre-application phase of the Horizon licensing project. A set of principles relating to ways of working across the GDA and NRL sub-programmes will be issued by the Heads of GDA and NRL. 48 Safety Case Workstream Leads will engage with Horizon s specialist counterparts to: Understand and verify the GDA specific and site specific elements of the site specific PCSR Understand and verify the timescale and approach for development of the site specific PCSR Identify any gaps between the GDA PCSR and the site specific PCSR and seek assurance from Horizon that it will address these gaps in a timely manner. 49 The Heads of GDA and NRL will ensure that Safety Case Workstream Leads understand and can demonstrate clear separation between GDA specific and licensing specific activities. 50 A Safety Case DMG Lead has been identified to coordinate and oversee the licensing safety case workstream interactions with Horizon undertaken by the Safety Case Workstream Leads. 51 Safety Case Workstream Leads will identify the scope, outcomes, key interim milestones and resource requirements for interactions with Horizon and record them in licensing Task Sheets. 52 The Safety Case DMG Lead will present the Task Sheets for the workstream group to the NRL Sub-Programme Board for confirmation that the Task Sheets align with this pre-application intervention strategy, and for endorsement. 53 The Safety Case DMG Lead will report progress with site specific PCSR interactions with Horizon to the NRL Sub-Programme Board which will oversee and monitor progress. Office for Nuclear Regulation Page 11 of 14

3.4 Security 54 The Security Workstream Lead will identify the scope, outcomes, key interim milestones and resource requirements and record them in Task Sheets. 55 Particular attention will be paid to areas where the site licence conditions have implications for security or where security can contribute to meeting or influencing licence conditions i.e. LC2 Marking of the site boundary LC11 Emergency arrangements LC16 Site plans, designs and specifications 56 The Security DMG Lead will present Task Sheets for the workstream group to the NRL Sub-Programme Board for confirmation that the Task Sheets align with this preapplication intervention strategy, and for endorsement. 57 The Security DMG Lead will report progress to the NRL Sub-Programme Board which will oversee and monitor progress. 58 It should be noted that ONR has already approved the Construction Site Security Plan for the Wylfa Newydd site (which may occur in advance of NSL application) and will commence interactions with Horizon for the development of its Nuclear Site Security Plan at an appropriate time. 3.5 Licensing, legal and safeguards 59 ONR s licensing specialist will act as both the Workstream Lead and the DMG lead for licensing, legal and safeguards activities. The licensing and legal focus will be on ensuring that key legal and process activities that are fundamental to the granting of a new nuclear site licence are being adequately progressed during the pre-application phase. These include: 3.5.1 Security of tenure 60 Working with the Treasury Solicitor to establish whether Horizon will be able to demonstrate ownership of the site or arrangements for leasing which achieve the level of security of tenure and rights of access commensurate with licence condition requirements. 3.5.2 Consultation with Natural Resources Wales 61 Working with Natural Resources Wales (NRW) to ensure that ONR s and NRW s statutory consultation obligations, which will be required under NIA 65 and the Environmental Protection Regulations (EPR 2010), are being addressed. 3.5.3 Consultation with DECC 62 Liaising with the Department of Energy and Climate Change (DECC) to ensure that it is making adequate progress in discharging its responsibilities for assessing Horizon s financial viability, developing arrangements for a funded decommissioning programme, establishing the adequacy and timing of nuclear liability insurance, and agreeing any impact on the nuclear site licence. 3.5.4 Regulatory Justification 63 Advising DECC as a member of their Justification Consultation Committee on the Nuclear Industry Association s application for regulatory justification of the UK ABWR under the Justification of Practices Involving Ionising Radiation Regulations 2004. 3.5.5 Site map and location details 64 Assessing the adequacy of Horizon s Wylfa Newydd site map and site boundary definition. Office for Nuclear Regulation Page 12 of 14

3.5.6 Relationship with the existing Wylfa nuclear power station licensed site 65 Experience with licensing the Hinkley Point C (HPC) site has shown that the relationship between the new nuclear site and the existing nuclear power station licensed site is important and that there are significant benefits to be gained from establishing this relationship and addressing issues of mutual interest at early stage of the licensing project. 66 The Licensing and Legal Workstream Lead will engage in dialogue with Horizon, Magnox Ltd, the Wylfa Newydd Site Inspector and ONR s existing Wylfa Site Inspector and any other key stakeholders to ensure that the following site related topics (and any emerging topics of mutual interest) are addressed: REPPIR - adequacy of emergency planning arrangements with respect to the construction site Inter-site nuclear safety agreements Communication protocols for exchange of information pertinent to the existing Wylfa nuclear site 67 The exercise to develop the Wylfa Newydd site map and define the site boundary will indicate whether or not the proposed boundary will incorporate land currently contained within the existing Wylfa nuclear power station licensed site boundary. In the event that this should be the case, the existing Wylfa site will need to be relicensed and this exercise will be included in the scope of the above workstream. 68 The Licensing and Legal Workstream/DMG Lead will engage with Horizon counterparts and will focus on providing advice and guidance to Horizon for the development of the arrangements described in sections 3.5.1 to 3.5.6. 69 The Licensing and Legal Workstream/DMG Lead will identify the scope, outcomes, key interim milestones and resource requirements for interactions with Horizon and record them in Task Sheets. The Licensing and Legal Workstream/DMG Lead will present Task Sheets for the workstream group to the NRL Sub-Programme Board for confirmation that the Task Sheets align with this pre-application intervention strategy, and for endorsement. 70 The Licensing and Legal Workstream/DMG Lead will report progress to the NRL Sub- Programme Board which will oversee and monitor progress. 3.5.7 Safeguards 71 Although the international safeguards regime and the measures applied in respect of it are not part of the site licensing process, ONR s Safeguards unit will take the lead in establishing timely engagement with Horizon and Euratom to: Define and agree nuclear materials accountancy and safeguards arrangements for Wylfa Newydd, including the process for specifying and installing Euratom surveillance and sealing equipment, and means of transmitting data from the equipment.. Ensure all statutory safeguards reporting requirements (e.g. for formal declarations to Euratom) are met. 72 The Safeguards Workstream Lead will identify the scope, outcomes, key interim milestones and resource requirements for interactions with Horizon and record them in Task Sheets. 73 The Licensing and Legal DMG Lead will present Task Sheets for the workstream group to the NRL Sub-Programme Board for confirmation that the Task Sheets align with this pre-application intervention strategy, and for endorsement. Office for Nuclear Regulation Page 13 of 14

74 The Licensing and Legal DMG Lead will report progress to the NRL Sub-Programme Board which will oversee and monitor progress. 4 COMMUNICATION 75 In line with its policy of openness and transparency, ONR will publish on its website: Quarterly statements of progress during the pre-application phase commencing when workstreams are fully established; A statement acknowledging receipt of Horizon s NSL application. 5 INTERVENTION OUTCOME 76 ONR will provide advice and guidance to Horizon across the pre-application phase through an intervention approach described in this strategy document. Progress will be monitored and reviewed by the NRL Sub-Programme Board and the joint Programme Management Meeting. 77 These interventions should enable ONR to make an informed judgement of the adequacy of Horizon s organisational capability, company structures, governance and procedures, site safety documentation and licence condition compliance arrangements and advise Horizon of its readiness to apply for a NSL. 78 Horizon will undertake an independent review of its readiness to apply for a NSL in accordance with its NSL application governance arrangements which it will share, and seek ONR s views, relating to: The readiness review findings; The content of its proposed NSL application dossier. 79 Horizon will consider whether to address any significant concerns that ONR may have before submitting its application, or propose a schedule to address them in advance of ONR s decision to grant a NSL. Office for Nuclear Regulation Page 14 of 14