A Look at Current Use of Funds and Cost Estimates for the Future
RCED-87-121: Published: Aug 31, 1987. Publicly Released: Aug 31, 1987.
- Full Report:
In response to a congressional request, GAO reviewed the Department of Energy's (DOE) nuclear waste management program to: (1) compare the use of fiscal year (FY) 1985 program funds with the approved budget; (2) assess the effects of schedule delays on program costs; and (3) assess the life-cycle cost estimates.
GAO found that: (1) although Congress appropriated $327.7 million from the Nuclear Waste Fund for FY 1985, DOE moved $12 million to other waste management subprograms and used $219.3 million for the first-repository subprogram; (2) because of delays in completing environmental assessments and site selections, the first-repository project offices could not accomplish many activities planned during FY 1985; (3) the additional funds required to complete the assessments and activities substantially increased the cost of the first-repository subprogram; (4) schedule delays compressed milestones and caused concerns over DOE ability to meet the original milestones without sacrificing quality; (5) DOE cost estimates have changed significantly due to uncertainty over the final design, construction, and operation of the waste system; and (6) since DOE based its spent-fuel projections and revenue estimates on long-range forecasts of economic activity and energy demand, overestimating future industry growth may result in DOE building an unnecessarily large waste disposal system and setting fees too low to produce revenues at the rate needed to cover total program costs.
Recommendation for Executive Action
Status: Closed - Implemented
Comments: DOE commented that basing waste system planning and cost and revenue analyses on actual nuclear power plants oversimplifies the task of projecting system requirements and fee adequacy. However, in its June 1988 draft Mission Plan Amendment, DOE reversed its position. It now intends to base long-range spent fuel projections on existing nuclear plants as recommended by GAO and others.
Recommendation: For waste system planning, including life-cycle cost analyses and fee adequacy determination, the Secretary of Energy should base long-range projections of spent-fuel inventories for commercial nuclear power plants on the nuclear generating capacity of operating commercial nuclear plants and plants that are actively progressing through Nuclear Regulatory Commission licensing and construction.
Agency Affected: Department of Energy