The applicability of a power-range instrument based on coolant gamma activity is discussed, indicating considerable merit for certain systems, but with some limitations. A general equation is presented for equilibrium coolant activity at reactor discharge. The effect of changing flow rate at fixed power is shown to influence detector reading. The effect of time lag between reactor outlet and detector is shown to introduce error, but that optimum location of the detector will minimize the total detector error. Transient response to step power and to step flow changes are evaluated. Analysis is applied to a water-cooled system and experimental data shown to verify predicted behavior. Effects of coolant impurities are discussed.