Uranium Enrichment:

Decontamination and Decommissioning Fund Is Insufficient to Cover Cleanup Costs

GAO-04-692: Published: Jul 2, 2004. Publicly Released: Jul 2, 2004.

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Decontaminating and decommissioning the nation's uranium enrichment plants, which are contaminated with hazardous materials, will cost billions of dollars and could span decades. In 1992, the Energy Policy Act created the Uranium Enrichment Decontamination and Decommissioning Fund (Fund) to pay for the plants' cleanup and to reimburse licensees of active uranium and thorium processing sites for part of their cleanup costs. This report discusses (1) what DOE has done to reduce the cleanup costs authorized by the Fund, and (2) the extent to which the Fund is sufficient to cover authorized activities.

The Department of Energy (DOE) has taken steps to reduce cleanup costs by taking actions that address recommendations made by the National Academy of Sciences and by pursuing an accelerated, risk-based cleanup strategy at the plants. In some cases, however, DOE has only partially addressed the Academy's recommendations. For example, one recommendation suggested that DOE develop three plans--namely, headquarters level, plant-complex level, and site level--that address and integrate the decontamination and decommissioning of the facilities. Only one plant has developed a plan, however. Additionally, DOE is pursuing an accelerated, risk-based cleanup strategy at the plants that it believes will reduce cleanup costs. According to DOE officials, an accelerated, risk-based strategy will accelerate time frames for cleanup, and establish "realistic cleanup criteria" in DOE's regulatory cleanup agreements. Despite DOE efforts to reduce costs, we found that based on current projected costs and revenues, the Fund will be insufficient to cover the cleanup activities at the three plants. Specifically, our Baseline model demonstrated that by 2044, the most likely time frame for completing cleanup of the plants, costs will have exceeded revenues by $3.5 billion to $5.7 billion (in 2004 dollars). Importantly, we also found that the Fund would be insufficient irrespective of which model we used, including models that estimated the final decommissioning at the plants under (1) accelerated time frames, (2) deferred time frames, or (3) baseline time frames, and with additional revenues from federal government contributions as authorized under current law. Because the Paducah and Portsmouth plants are now estimated to cease operations by 2010 and 2006, respectively, extending the Fund by an additional 3 years would give DOE an opportunity to develop plans, including more precise cost estimates, for the cleanup of these plants and to better determine if further Fund extensions will be necessary.

Matters for Congressional Consideration

  1. Status: Closed - Not Implemented

    Comments: Although hearings were held in November 2007 to discuss draft legislation to reauthorize the Fund and require DOE to continue to assess the Fund's sufficiency, as of July 2008, this legislation has yet to move out of Committee.

    Matter: In order to better ensure that the Fund will be sufficient to cover the projected costs for authorized activities, Congress may wish to consider requiring DOE to reassess the sufficiency of the Fund before the expiration date to determine if extensions beyond 2010 will be necessary.

  2. Status: Closed - Not Implemented

    Comments: Although hearings were held in November 2007 to consider draft legislation that would reauthorize the fund until 2015, as of July 2008, this draft legislation has not yet moved out of Committee.

    Matter: In order to better ensure that the Fund will be sufficient to cover the projected costs for authorized activities, Congress may wish to consider reauthorizing the Fund for an additional three years to 2010.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: In its fifth triennial report to Congress, DOE included an updated estimate of the future costs for the decontamination and decommissioning of the Paducah plant that was based on a recently completed revision to the cost estimates for the cleanup of the plants. The updated cost estimates included a cleanup plan, cost, and schedule, as well as uncertainties that could impact the costs and time frames for completion.

    Recommendation: To help reduce uncertainty regarding the sufficiency of the Fund, the Secretary of Energy should develop a decontamination and decommissioning plan for the Paducah plant that would identify the most probable time frames and costs for completing final decontamination and decommissioning (D&D).

    Agency Affected: Department of Energy

  2. Status: Closed - Implemented

    Comments: In its fifth triennial report to Congress, DOE included an updated estimate of the future costs for the decontamination and decommissioning of the Portsmouth plant that was based on a recently completed revision to the cost estimates for the cleanup of the plants. The updated cost estimates included a cleanup plan, cost, and schedule, as well as uncertainties that could impact the costs and time frames for completion.

    Recommendation: To help reduce uncertainty regarding the sufficiency of the Fund, the Secretary of Energy should develop a decontamination and decommissioning plan for the Portsmouth plant that would identify the most probable time frames and costs for completing final D&D.

    Agency Affected: Department of Energy

 

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