March 17, 2014

IN WAKE OF NEW CAPE REPORT, CAN UPF EVER BE BUILT?

By ExchangeMonitor

Even under the most optimistic scenario, officials with knowledge of a Department of Defense cost study on the Uranium Processing Facility are beginning to find it hard to imagine it being built as one massive standalone facility. DoD’s Cost Assessment and Program Evaluation group recently completed a study on the facility that suggested it could cost between $10 and $12 billion—and as much as $19 billion under a worst case scenario—which is significantly more than the National Nuclear Security Administration’s previous $6.5 billion estimate. The project will be one of the subjects discussed Tuesday at a Defense Nuclear Facilities Safety Board hearing. None of the funding scenarios examined by CAPE had the facility being completed by 2025, when officials currently want to move production work out of Y-12’s 9212 complex. The CAPE also recommended that the NNSA that another look at the path forward for the project, calling into question the strategy of building large, one-of-a-kind nuclear facilities. “There is no scenario here that gets you done by 2025. … If they are serious about getting out of 9212 quickly they have to rethink their approach,” one official with knowledge of the report told NW&M Monitor.

As recently as earlier this year, the agency decided to defer an effort to build a massive plutonium facility at Los Alamos National Laboratory, abandoning plans to build the Chemistry and Metallurgy Research Replacement-Nuclear Facility and shifting to a plan that would utilize smaller facilities to meet the plutonium needs of the lab. The change in strategy was just the latest shift in thinking on the agency’s two massive infrastructure modernization projects. In the mid-2000s, the agency planned to build the two projects at the same time, but near the end of the Bush Administration officials began to worry that they might have to phase the two projects because of funding constraints. That changed during debate on the New START Treaty during President Obama’s first term when the Administration pledged to modernize the nation’s nuclear stockpile and weapons complex, but recent budgetary pressure has again raised questions about the viability of building multi-billion-dollar nuclear facilities, with CMRR-NF being the first casualty.

Cost concerns on major NNSA projects have brought about increased Congressional scrutiny, and Sen. Lamar Alexander (R-Tenn.), the ranking member of the Senate Energy and Water Appropriations Subcommittee, said this weekend in a statement to NW&M Monitor that he would take the CAPE report into account during his oversight of the project. “The new Uranium Processing Facility project is vital but will be expensive,” he said. “To try to make sure that the Department spends no more money than absolutely necessary, Sen. [Dianne] Feinstein and I have insisted upon three things: (1) an independent review of costs and program, which the CAPE has conducted; (2) that the design be 90 percent complete before construction begins; (3) that the accountable government officials meet with the two of us regularly to report whether they are proceeding on time and on budget. Before the design is complete, I will carefully consider the CAPE team’s recommendation.”

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