[ RadSafe ] INPO model for Big Oil?

Miller, Mark L mmiller at sandia.gov
Tue Jun 22 15:33:09 CDT 2010

BP's Gulf Catastrophe is Big Oil's Three Mile Island:  Will They Learn from the
Nuclear Industry how to Achieve Environmental Safety and Operational Surety?

Following the tragic accident at Three Mile Island (TMI) Unit #2 in 1979, executives from all of the U.S utilities who operated nuclear power plants convened a meeting at which they resolved "Never Again".  Their concern was real, not just for the public and environment's well being, but for the very survival of commercial nuclear power generation.  They recognized, that in spite of the fact that no actual environmental harm resulted from the TMI accident, the public would call for an immediate shutdown of all remaining power plants in this country if another significant accident occurred at any of the remaining operating nuclear power plants.  The utility consortium's objective was to establish a program that specified appropriate safety standards including those for management, quality assurance, operation procedures and practices, and independent evaluations.  Also, it was clear that there must be systematic gathering, review, and analysis of operating experience at all nuclear power plants, coupled with an industry wide communications network to facilitate the speedy flow of this information to affected parties.  From that meeting came the Institute for Nuclear Power Operations (INPO)<http://www.inpo.info/Index.html>.  Their mission:  to promote the highest levels of safety and reliability - to promote excellence - in the operation of commercial nuclear power.  They go about achieving this mission<http://www.inpo.info/AboutUs.htm> by a very aggressive and transparent , straightforward process which includes:
*       establishing performance objectives, criteria and guidelines for the nuclear power industry
*       conducting regular detailed evaluations of nuclear power plants, and
*       providing assistance to help nuclear power plants continually improve their performance.
INPO's primary objectives were focused on public safety and operational assurance, not profitability.  However, a pleasant surprise occurred when the INPO recommendations became the operational standard that all commercial utilities lived by.  Availability factors and profits skyrocketed!  As is often the case, safety professionals strive incessantly to convince management that safety doesn't cost money;  it actually makes money!  INPO's beneficial impact on the nuclear utilities is dramatic, undeniable proof of those arguments.
Commercial nuclear power went from availability factors of around 70% in the 1980's to consistently above 91% in 2010.  This is due, in part, to the INPO-inspired "best management practices" that were imposed by peer utility operators rather than any "regulatory requirements" enforced by the Nuclear Regulatory Commission (that were necessarily less ambitious than peer-imposed objectives).  Big Oil would do well to consider this success in light of the enormous stakes involved in continuing to provide oil to the market with reasonable assurance that they can do it without a repeat of the BP Gulf Disaster.
All of Big Oil should be equally concerned with the crisis being faced by BP (even though BP caused it, this time).  This is because exactly the same thing could happen to any one of them in the future.  Competing energy companies must share with one another (and enforce upon one another) the "best management practices" which the INPO-inspired model enabled the commercial nuclear industry to achieve its very impressive accomplishments since the TMI Accident.
The public cry for more and stronger regulatory oversight will never result in as effective improvements as peer-imposed requirements.  This is because the regulatory process is, of necessity, long, drawn out, deliberative and one-size-fits-all.  As a result, many of the resultant regulations are less effective than they were initially intended to be.  Furthermore, their development is necessarily and heavily influenced (political, lobbyist and public hearing influences) by the industry that they are designed to regulate.  Rather than rhetoric and "camera dressing" that is part of the regulatory development process, peer-imposed requirements go directly to a clear objective and are not subject to the inevitable distortions that may be the final product of even the best-intended regulatory development.
Make no mistake that unambiguous, fair, consistent, enforceable regulations are an absolute necessity.  However, their effectiveness can only be expected to go so far.  Beyond that, aggressive proven-to-be-effective "best management practices" developed by peer-competitors and imposed with an unwavering focus on both public safety and the industry's survival is essential.
 The idea of removing liability limits for companies that cause environmental harm that is being considered may be a good idea.  It will properly re-focus risk/cost/profit evaluations, rather than encouraging profit-motivated safety shortcuts that are more likely to occur if a commercial entity knows that taxpayers (or ratepayers) will "pick up the tab" for anything in excess of published liability limits.
Today, 30 years after TMI, Big Oil is facing the same crisis that faced the nuclear industry in 1979.  Will Big Oil recognize the opportunity to adopt a proven, successful model that the INPO experience provides to rescue their industry from a painful demise or a new profusion of costly any marginally effective regulations for which the public is clamoring?  What they (and the public) needs is assurance that things will operate as designed, not insurance to pay for accidents when they don't.
End note:  The world will continue to demand oil to satisfy its insatiable need for energy.  World economies are directly tied to the availability of energy, and oil plays a prominent role in this reality.  It is in the interest of the world's consumers of oil that Big Oil achieves the highest possible operational safety assurances in addition to continuing as a viable and profitable industry.  This will enable them to provide their valuable commodity at the lowest prices to consumers with the assurance that this success is being achieved with the highest possible assurance of being achieved safely.  Punitive damages and compensation for accidents may look and feel good for a short while, but they pale in comparison to doing the right things the first time.  Ask any resident of the Gulf Coast who is affected by the BP spill:  "Would you rather have your livelihood back, or would you like a compensation check from BP?"

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