FirstEnergy To Merge Nuclear Operations

(Painesville, Ohio) This past week, Gary Leidich, President of FirstEnergy Nuclear Operating Co., met with a panel of seven high-ranking members of the Nuclear Regulatory Commission (NRC) at the Renaissance Quail Hollow Resort east of Cleveland. The purpose of the meeting was to announce FirstEnergy's plan to consolidate nuclear operations management at its three operating facilities, the Davis-Besse nuclear plant in Ottawa County, the Perry Nuclear Plant east of Cleveland, and the Beaver Valley complex northwest of Pittsburgh. The consolidation effort was characterized as a streamlined "fleet approach" with some semblance to a military chain of command. Leidich said the changes were deemed necessary after evaluating problems at Davis-Besse and Perry.

Curiously, it appears the meeting was held primarily for informational and announcement purposes. The NRC does not customarily concern itself with a utility's organizational structure as long as minimum qualifications and staffing levels pursuant to the operating license are met and as long as nuclear and public safety are not degraded.

From an organizational and business perspective, consolidation of management functions among three facilities is a good idea but it won't be welcomed by many. In particular, those that will no longer be needed. The Davis-Besse, Perry, and Beaver Valley plants have operated for decades as independent entities, providing all line and support functions in-house. To illustrate, each has had its own group to conduct training, control documents, maintain records, do purchasing and accounting, conduct audits and inspections, and so on. Obviously, with numerous groups doing the same or similar jobs, there will be duplication of effort, which will be pared down upon consolidation.

From a strictly operational perspective, streamlining the management structure will produce more responsiveness and efficiency throughout the entire company. Upper management will see an enhanced ability to specifically define responsibility and authority and to quickly correct problems and implement initiatives. It will still be a bureaucracy, but leaner and more accountable.

From a personal perspective as a customer, any changes which produce efficiencies that keep the cost of electricity from increasing have my full support.

All that said, it can't be overlooked that President Leidich is trying to implement dramatic changes to a sloth-like bureaucracy which will impact many people's lives. Hopefully, the consolidation can be completed with employee discontent kept as low as reasonably achievable.