The Three Mile Island nuclear accident in Pennsylvania in 1979 was a fresh memory.

And only 800 people lived within a 10-mile radius of Palo Verde, 50 miles west of downtown Phoenix.

Almost 20 years later, no new nuclear power plant is on the drawing board, Three Mile Island remains the lone major industry mishap, and West Valley growth is encroaching ever closer to the plant's reactors.

Palo Verde, with a stellar operating record for most of the 1990s, is headed toward midlife in the next few years, posing new regulatory and maintenance challenges. The units, built at a cost of $9.3 billion, initially were licensed for 40 years in the mid-1980s.

Both the Nuclear Regulatory Commission and plant operator Arizona Public Service Co. are confident they are capable of safely extending the plant's life.

But there have been unanticipated problems. In February and March, each of the plant's three units was shut down on separate occasions for minor radiation leaks. Two of those were related to aging. And the NRC plans an investigation at the plant, citing a fractured relationship between management and employees that could affect the plant's safety culture.

Although the recent problems are relatively minor, the fact that Palo Verde and other nuclear plants across the nation are getting older is a growing concern to regulators.

"Nothing works as well as it did when it was new," said Victor Dricks, a spokesman for the NRC's regional headquarters in Arlington, Texas, which oversees Palo Verde.

Some question whether the NRC can adequately handle the situation.

"There are a lot of resources going into inspections, and there are signs that things aren't working just right," said David Lochbaum, a nuclear safety engineer with the industry watchdog Union of Concerned Scientists. However, Lochbaum said that he believed that Palo Verde was a well-run operation and one of the better plants in the country. Operators appeared to be on top of problems and able to anticipate potential issues, he said.

The NRC routinely grants 20-year extensions to initial 40-year licenses, raising the specter of an industry eventually running on 60-year-old infrastructure.

James M. Levine, APS' executive vice president in charge of generation, said the company would likely seek to extend its licenses as well. Palo Verde is owned by seven utilities, but APS has the largest share, 29.1 percent, and manages the plant for the other owners.

Although problem-plagued during much of its first 10 years, Palo Verde since has enjoyed a strong operating record. Its units now operate at 90 percent efficiency, compared with 60 to 70 percent in the early years. And a review by The Republic of dozens of inspections, conducted by the NRC at Palo Verde over the past four years, found only minor infractions with minimal safety consequences.

That compares with the early 1990s when the NRC was considering replacing APS as the plant's operator because of a string of safety problems. During that period, APS was fined $230,000 for retaliating against three employees who raised safety concerns. APS also paid a $100,000 fine in 1994 for allowing three people, including two felons, unescorted access to the plant without adequate security checks.

Even as APS considers extending the life of the plant, the three Palo Verde units are starting to show their age. Besides the problems early this year, an 800-ton steam generator that was supposed to last the life of the plant had to be replaced in Unit 2 in 2003. The $230 million component that converts nuclear energy into steam and electricity was found to be prone to radiation leaks due to a faulty material called Iconel 600.

The nickel alloy, used to make thousands of components in the huge steam generators and in the plant's nuclear reactors, is prone to stress corrosion cracking under pressure and heat.

Scheduled replacements

Levine said the huge generators in Palo Verde's other two units are scheduled to be replaced in 2005 and 2007.

APS and the NRC have developed programs for monitoring and testing the Iconel 600 components, which include 13,000 heating tubes in each of the steam generators.

Levine and the NRC believe Units 1 and 3 can be operated safely until the scheduled replacement of the steam generators in 2005 and 2007.

"It's a well understood issue, and there are comprehensive guidelines for dealing with this," Dricks said.

Levine explained that the steam generator in Unit 2 deteriorated faster than the other two, possibly due to contaminates in the water that is turned into steam when it comes in contact with the heating tubes. The 13,000 tubes carry pressurized water that is heated to more than 600 degrees by the reactor.

In 1993, one of the tubes burst in Unit 2 and dumped 100 gallons of radioactive water per minute into the reactor's steam generator, which was vented to the outside atmosphere. Stress corrosion cracking caused the tube to rupture. It also was blamed for a small leak in February.

On Feb. 29, workers found traces of boric acid on a heater sleeve in the Unit 3 reactor cooling system. Boron, which forms boric acid, absorbs neutrons and is used to control the rate of nuclear fission inside the reactor. Its presence on the heater sleeve indicated a leak of radioactive material.

APS quickly shut down the unit where the acid was found to make repairs. But NRC rules would have allowed the continued operation of the plant.

At the Davis-Besse Nuclear Power Station near, Toledo, Ohio, the plant continued to operate despite evidence of a leak in the top of a vessel that holds the plant's reactor.

In 2002, it was discovered that the boric acid had eaten through the six-inch steel head. That left only a three-eighths-inch strip of stainless steel to protect the reactor from rupturing and causing a devastating accident.

The plant was shut down by the NRC and restarted only last month.

The plant's operator, First- Energy Corp., acknowledged to regulators that it put production ahead of safety and had deferred inspections and corrective-action programs.

The Davis-Besse investigators found that managers weren't involved in fixing problems and rarely went into the reactor building, and operators justified potential problems to keep the plant running instead of making repairs.

Ironically, the NRC had enough safety concerns to shut Davis-Besse down in 2001, but allowed it to remain operating.

Culture of safety vital

While regulators point to Palo Verde's impressive safety and operating record in the past decade, they are concerned that issues between Palo Verde's management and its employees potentially could lead to an erosion of the plant's "culture of safety," similar to what occurred at Davis-Besse.

It's a scenario that was expounded by several Palo Verde employees at a recent meeting called by the NRC to discuss Palo Verde's performance over the past year. The employees say that safety concerns brought to management have gone unheeded. Dysfunctional eyewash stations and safety showers near areas where acid is handled, for example, were not repaired for weeks after their conditions were reported.

Palo Verde led the industry last year with the number of allegations filed by employees with the NRC. The so-called allegations are generally filed with the NRC because the employee could not get satisfaction from management or they feared retaliation.

The 28 allegations, kept secret by the NRC, ranged from safety concerns such as the showers and eyewash stations to more generic human resource issues.

Silverio Garcia, a longtime Palo Verde employee, attributed the rise in allegations to a culture of mistrust between management and employees.

"How can you have a safety-conscious work environment with a trust problem?" Garcia asked at the April 1 NRC hearing.

In January, Palo Verde's managers were called to the NRC's Arlington headquarters to answer questions about the high number of allegations and whether employees at Palo Verde felt free to raise safety issues with the plant's management.

After interviewing a number of employees, the regulators concluded that in matters of nuclear safety, the workers felt comfortable about going to management. But, they noted, the employees might not feel as free to bring up other concerns. It's a situation regulators are concerned could lead to a deterioration of the plant's safety culture.

As a result, they plan to visit Palo Verde in May to determine whether the management-employee disconnect is isolated to one or two departments or widespread.

"We don't regulate employee-management relations," said Mark Satorius, an NRC deputy director in its reactor projects division. "But we see a strong correlation between management style and employee awareness of safety issues."

Levine acknowledged that the situation with the eyewash stations could have been handled better. Instead of simply fixing the problem, managers went on the defensive and insisted the showers met regulations.

He added that in response to the NRC's concerns, APS has initiated training programs aimed at improving relations between management and employees.

No security concerns

After the Sept. 11, 2001, attacks, the plant raised its security to a heightened level, but the NRC said it had no concerns in that area. Another issue facing the plant is the growing store of spent radioactive fuel rods stored at the site. Plans call for the removal of the rods to a planned facility in Nevada, but that site may not be ready for years.

Rising natural-gas prices and growing concern about global warming is casting once-stigmatized nuclear power in a more favorable light. New technology that has brought down the cost of the plants and the government's pledge to reduce permitting red tape also has improved the climate for new nuclear facilities.

Less than a week after the 25th anniversary of the worst nuclear mishap in U.S. history, a consortium of seven companies said it would file the first application for a new nuclear power plant since 1973. The five energy companies and two reactor vendors emphasized that none of the companies has made a commitment to build a new plant, but are taking the move to test the government's streamlined licensing process.

Interest in new reactors faded after the nuclear accident at the Three Mile Island plant in Pennsylvania on March 28, 1979. Many projects were canceled after the accident, although 51 reactors in the pipeline were completed. Three of those were at Palo Verde.

Levine said that the site easily could accommodate additional reactors. But, he added, two factors stand in the way.

While the plant was built with excess transmission capacity, that has been used up and new transmission to California and to the Valley would have to be built to handle an increase in power production at Palo Verde. The other obstacle is water. The plant now uses effluent purchased from Phoenix to cool the plant. Levine said it would be difficult to acquire a sufficient quantity of effluent to support additional reactors.