CASE STUDY: KOZLODUY NUCLEAR POWER PLANT
In 1995, when Kozloduy NPP Plc (KNPP) was faced with modernizing Bulgaria's Kozloduy nuclear power plant, the team had a crucial directive: Accomplish work as quickly as possible, but, to keep the revenue flowing, ensure that power generation continues.
Each with a net electric output of 1,000 megawatts (MW), units 5 and 6 of the plant generate more than 25 percent of the country's energy. Due to the magnitude of the modernization—and considering the extensive technical scope, stringent planning conditions and high budget—a KNPP project manager worked with Parsons E&C to develop customized processes for effective, efficient project performance. The work is being performed by Westinghouse and the European Consortium Kozloduy, which includes Framatome France, Framatome Germany (formerly Siemens Nuclear) and Atomenergoexport from Russia.
The modernization program covers 212 modifications to improve the safety, operability and reliability of the units, extending the units' lifetime by at least 15 years. To keep an adequate level of power production, plant outages have to be limited to 90 days. This decision represents a reasonable compromise between contractor requirements for a long, interference-free installation and KNPP's desires to minimize the units' inactivity. Considerations also include system and components subject to routine or special periodic maintenance.
PHOTOS COURTESY OF KOZLODUY NPP PLC
When performing modernization on a Bulgarian nuclear plant, Kozloduy NPP Plc (KNPP) worked with Parsons E&C to develop customized processes for effective, efficient project performance.
KNPP created an independent modernization and investment division to manage the program internally.
Information was shared in technical council meetings, allowing executives to make key decisions.
Documentation databases were used to track official correspondence by delivery date, number and subject.
In June 1995, the modifications were defined by KNPP, Energoproekt Plc, Risk Engineering and Electricite de France and reviewed by the Bulgarian Nuclear Regulatory Agency (BNRA) and the International Atomic Energy Agency (IAEA). Today, the work is more than 50 percent complete, and, thanks to tight project controls, work is progressing smoothly toward the expected 2006 end date.
The project phases follow a logical flow from detailed design, procurement and factory acceptance tests though delivery, installation, and testing of the new equipment and systems. The contractors' schedules were tailored to the units' outage plans, and licensing procedures ran concurrently to early work stages.
With a clear idea of the requirements, KNPP created an independent modernization and investment division to manage the program internally. With responsibility for all technical coordination, compliance, planning, correspondence and contract performance issues, the division serves as the main contact point for the program's contractors.
The division is laid out in a multidiscipline matrix with eight areas:
- Studies and Program Analysis
- Quality Assurance
- Contract Administration
- Financial Planning
- Cost Control and Management
- Communications and Documentation Control.
A project management manual ensures there are no gaps or overlaps in the plan—the team can't afford any confusion about who was responsible for what. A responsibility matrix further outlines project phases/activities and the KNPP departments that take the main and supporting roles.
Aside from their knowledge of nuclear reactors, engineering, construction and commissioning techniques, project leaders based planning decisions on research. The team examined other state-of-the-art modernization efforts, including the operational results of other plants' modifications, case studies, cost-effective upgrading techniques used throughout the power industry and manufacturers' capabilities.
However, the planning team also relied on KNPP strategic plans. Many decisions were influenced by the business implications, including power production and grid interaction, the technical economic benefits and the staff capabilities development.
To incorporate all elements necessary for the proper evaluation of scope, safety and quality, KNPP's technical staff worked closely with executives.
As work progresses, the team discusses relevant information in technical council meetings, in which decisions are made about the acceptability of the deliverables. Whenever the issues involve the potential to affect plant operation or financials, the division managers offer their insight and help choose the best options.
Because the work must be performed under international (IAEA, ISO) and national (BNRA) standards, a quality assurance program was developed to integrate tasks with existing KNPP quality procedures and programs.
Due to the complexity of the project, the KNPP team also developed specific procedures to regulate the activities of the main contractors, which all have their own quality assurance programs. Staff indoctrination programs ensured that all staff understood the procedures from the start.
The respective quality plans were reviewed to ensure that the authorized personnel verified and controlled all required quality steps. Any deviations were reported, and, in the case of persistent deviations, non-conformance reports were issued for corrective action. So far, the program shows a low number of nonconformities. However, many documents required rework by the contractors to meet the established quality requirements.
BNRA requires a three-step licensing process before contracts can proceed. The KNPP project team formally presented information on the selected contractors' organizations and the quality programs to BNRA, highlighting suppliers' and subcontractors' qualifications and ISO 9000 certifications.
After the contractors were authorized, the regulatory process required the KNPP team to gain permission to start the design and supply tasks and submit both the technical specifications and the related justification documents. Today, interaction between BNRA and KNPP is open and smooth, and clarifications are provided promptly.
In 2002, during outages in units 5 and 6, lessons learned were documented and then shared with both major contractors, who used them to improve performance in a 2003 planned outage in unit 6. When the safety-related measures finally are integrated into the units' updated safety analysis report, intensive coordination and communications are expected.
The modernization and investment and plant production groups, along with Parsons E&C staff, review the contractors' deliverables documents for technical specifications, compliance with international and national standards, quality, safety, seismic and environmental requirements, and overall good engineering and construction practices.
At technical council meetings, these documents are either accepted or sent back to the contractors for further enhancement. KNPP staff promptly communicates the review's results to the contractors and expedites the presentation of the requested revisions. The internal review timeframes are always on time—and shorter whenever the workload allows.
Time is Money
The program is financed partly through a European Union Euratom loan (43 percent). Citibank funds another 16 percent through an Eximbank loan, Russia's Roseximbank provides another 12 percent, and the rest of money comes directly from KNPP's own resources.
The loans are disbursed as milestones are completed, so early planning was critical. In addition, as the safety modifications are implemented in an operating nuclear power plant, the team has to allocate time carefully to avoid extending outages too long.
The planned activities and their financial requirements make up the cash requirements, which have been incorporated into KNPP's short-, medium- and long-term internal costs, including loan interest and administration fees.
The modernization and investment division, together with the economic and financial division, assures there are no budget deviations and that the eventual scope adjustments are controlled and authorized prior to implementation.
KNPP and Parsons E&C process detailed cost data and summarize the information in a monthly cost report, which is issued internally to KNPP management and to the ministers of energy and energy resources and of economics and finance. The report offers data on physical and economic progress and is monitored against the plan, indicating the positive and negative variances.
A borrower's report is issued to Euratom for requests for partial fund disbursements. In addition, KNPP and Parsons E&C prepare Euratom quarterly reports, which detail progress and overall well-being of the program.
The contractors' invoices go through a rigorous review and acceptance process. Payment is based on the verification of the completeness of the payable milestone, conformity to the technical specifications, opportunity of completion, the necessary or referred documentation, and the accuracy of the amounts. In 2000, the plant separated from the Energy Utility and became an independent business unit. Since then, KNPP is covering its internal operating costs with revenues from the energy produced, and similar to other nuclear plants worldwide, outage optimization programs have been started in parallel with the modernization works.
The modernization team often has to sort through numerous intense correspondence on project issues. To regulate this flow of information, the team built a standard for communication based on a normalized numbering system for document classification, filing and retrieval.
Documentation databases are used to track official correspondence—paper originals or copies—by delivery date, number and subject. Most correspondence is filed electronically in a new unified document database management and administration system.
To keep the project on track, the KNPP team has to review and effectively answer contractors' correspondence. Contractors' letters involve technical scope concerns, quality problems, questions and clarifications, planning and scheduling issues, contract concerns, and cost or financial considerations. KNPP has implemented a review process for contractors' correspondence to ensure project and contract compliance and to minimize conflicts.
The project stakeholders represent many nationalities—Bulgarian, Russian, American, German and French. In addition, organizations from other nations, including the United Kingdom, Italy and Spain, are participating on an ad hoc basis.
To facilitate communication, contractors' documents and correspondence have to be translated into Bulgarian and English, the official languages for the program. Translation is particularly critical because engineering terms could mean different things in different countries.
KNPP created a department for communications and documentation to plan and organize the translation activities while monitoring the program implementation. The department also works to dissolve cultural barriers between different nationalities.
Plant staff is being prepared to operate and maintain the newly installed systems and equipment—training is a requisite for achieving full scope compliance. The original equipment manufacturers offer training at their premises. So far, several training sessions have been implemented successfully.
So far, the modernization program team is successful in dealing with suppliers and vendors from different national backgrounds, while ensuring quality management—the systems from different designers and vendors have been merged. The program is complying with the defined scope, schedule and budget limitations. Upgrading the management techniques has been a constant in the modernization program. PM
Oscar A. Mignone is the site manager of Parsons E&C for the modernization of Units 5 and 6 of the Kozloduy plant. He has more than 30 years of experience in engineering, construction and planning management for nuclear and conventional power projects.
Nayden Naydenov is project manager for the modernization program on Units 5 and 6 of the Kozloduy plant. He has almost 20 years of experience in nuclear power plant operation and maintenance of instrumentation and control systems and in business management.
PM NETWORK | JUNE 2004 | WWW.PMI.ORG