Index

Department of Energy: Uncertainties and Management Problems Have Hindered
Cleanup at Two Nuclear Waste Sites (Testimony, 07/12/2000,
GAO/T-RCED-00-248).

Pursuant to a congressional request, GAO discussed the: (1) challenges
and uncertainties facing the Department of Energy (DOE) in cleaning up
its Paducah, Kentucky, uranium enrichment site; and (2) effectiveness of
DOE's oversight and management of its in-tank precipitation (ITP)
project.

GAO noted that: (1) DOE expects to complete the cleanup of the Paducah
site by 2010 at a cost of about $1.3 billion; (2) however, numerous
technical, funding, and regulatory uncertainties present challenges to
DOE's ability to complete the cleanup within this timeframe and cost
estimate; (3) technical uncertainties include the planned use of
technologies that are unproven or perhaps not well suited to the site's
conditions; (4) even when the planned cleanup has been carried out,
billions of dollars and many years will be needed to address areas at
the Paducah site that are not in the cleanup plan; (5) for example, the
plan does not include cleaning up nearly 1 million cubic feet of waste
and scrap in areas known as DOE Material Storage Areas and 16 unused and
inactive buildings and structures; (6) some of the waste and scrap
material pose a risk of an uncontrolled nuclear reaction that could
threaten worker safety; (7) by not including these areas in the plan,
the Paducah cleanup managers cannot assess risk or plan cleanup on a
comprehensive, sitewide basis; (8) therefore, the picture of the cleanup
task at hand is distorted; (9) a number of management and oversight
problems caused DOE and Westinghouse Savannah River Corporation, DOE's
contractor, to spend almost a half billion dollars and to take about a
decade before deciding that the ITP process would not work safely and
efficiently as designed; (10) for example, in 1993, a technical review
team reported that the contractor tended to react to problems after they
occurred, rather than working to prevent them in the first place; (11)
the team also found that DOE lacked the necessary personnel for adequate
oversight; (12) DOE and the contractor encountered delays in starting up
the ITP facility because they had begun construction before the design
of the process was completed; (13) DOE and the contractor encountered
delays in starting up the ITP facility because they had begun
construction before the design of the process was completed; (14) DOE
and the contractor also did not adequately understand the cause of the
technical problems--such as a lack of understanding of the chemistry
involved in the ITP process--that made the process unworkable; (15)
problems that led to the ITP failure may have continued in DOE's efforts
to find an alternative; and (16) an October 1999 National Research
Council report states that contractors appear to be focusing on an
engineering solution on the basis of untested assumptions.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  T-RCED-00-248
     TITLE:  Department of Energy: Uncertainties and Management
	     Problems Have Hindered Cleanup at Two Nuclear Waste Sites
      DATE:  07/12/2000
   SUBJECT:  Radioactive pollution
	     Environmental monitoring
	     Radiation exposure hazards
	     Hazardous substances
	     Water pollution control
	     Nuclear facilities
	     Nuclear waste management
	     Uranium
	     Radioactive waste disposal
IDENTIFIER:  Paducah (KY)
	     Savannah River (SC)
	     DOE In-Tank Precipitation Project

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GAO/T-RCED-00-248

Mr. Chairman and Members of the Task Force:

We are pleased to be here today to discuss management, oversight, and other
challenges that the Department of Energy (DOE) faces in its efforts to clean
up radioactive and hazardous materials at the Paducah, Kentucky, uranium
enrichment site and to remove high-level radioactive waste from more than 34
million gallons of liquid waste stored at its Savannah River, South
Carolina, site. DOE faces a number of challenges and uncertainties at
Paducah as it attempts to address about 10 billion gallons of groundwater
contaminated with radioactive and hazardous materials, contaminated surface
water that is in creeks and ditches and leaves the site, contamination in
soils that may be spread by rain, tons of buried waste, and the equivalent
of about 52,000 barrels of waste stored on the site. From 1988 though 1999,
DOE spent about $388 million on the Paducah site's cleanup and plans to
spend another $1.3 billion over the next 10 years. At Savannah River, we
focused on identifying the factors that caused delays and cost growth of the
in-tank precipitation (ITP) project. In 1983, DOE selected the ITP process
to remove high-level waste from the 49 underground tanks. DOE estimated that
the construction of the ITP facility would be completed in 1988 at a cost of
$32 million. After years of delay and spending about a half billion dollars,
in February 1998, DOE suspended the project because it would not work safely
and efficiently as designed--large amounts of explosive, toxic benzene gas
were produced by the process. Soon after the suspension, DOE began a process
to find an alternative technology to replace the ITP project. The Department
has narrowed the selection to four technologies.

Our testimony today is based on our April 28, 2000, report on the Paducah
cleanup and our April 30, 1999, report on the ITP project at the Savannah
River Site. Our testimony describes the challenges and uncertainties facing
DOE in cleaning up the Paducah site and the effectiveness of DOE's oversight
and management of the ITP project. Our summary follows:

   * DOE expects to complete the cleanup of the Paducah site by 2010 at a
     cost of about $1.3 billion. However, numerous technical, funding, and
     regulatory uncertainties present challenges to DOE's ability to
     complete the cleanup within this time frame and cost estimate. For
     example, technical uncertainties include the planned use of
     technologies that are unproven or perhaps not well suited to the site's
     conditions. If they do not work as planned, or at all, costs will
     increase. In addition, even when the planned cleanup has been carried
     out, billions of dollars and many years will be needed to address areas
     at the Paducah site that are not in the cleanup plan. For example, the
     plan does not include cleaning up nearly 1 million cubic feet of waste
     and scrap in areas known as DOE Material Storage Areas (DMSA) and 16
     unused and inactive buildings and structures. Some of the waste and
     scrap material pose a risk of an uncontrolled nuclear reaction that
     could threaten worker safety. By not including these areas in the plan,
     the Paducah cleanup managers cannot assess risk or plan cleanup on a
     comprehensive, sitewide basis. Therefore, the picture of the cleanup
     task at hand is distorted.

   * A number of management and oversight problems caused DOE and
     Westinghouse Savannah River Corporation (Westinghouse), DOE's
     contractor, to spend almost a half billion dollars and to take about a
     decade before deciding that the ITP process would not work safely and
     efficiently as designed. For example, in 1993, a technical review team
     reported that the contractor tended to react to problems after they
     occurred, rather than working to prevent them in the first place. The
     team also found that DOE lacked the necessary personnel for adequate
     oversight. Moreover, DOE and the contractor encountered delays in
     starting up the ITP facility because they had begun construction before
     the design of the process was completed. DOE and the contractor also
     did not adequately understand the cause of the technical problems-such
     as a lack of understanding of the chemistry involved in the ITP
     process--that made the process unworkable. Some of the problems that
     led to the ITP failure may have continued in DOE's efforts to find an
     alternative. According to an October 1999 National Research Council
     report, a lack of understanding of the chemistry involved in the
     process continues, and the contractor appears to be focusing on an
     engineering solution on the basis of untested assumptions.

Challenges and Uncertainties Face DOE in Paducah's Cleanup

In 1988, radioactive contamination was found in the drinking water wells of
residences near the federal government's uranium enrichment plant in
Paducah, Kentucky. In response, DOE began a cleanup program to identify and
remove contamination in the groundwater, surface water, and soils located
within and outside the plant's boundaries. Sources of the hazardous chemical
and radioactive contamination included spills, leaks from contaminated
buildings, buried waste, scrap yards, and waste lagoons. From 1988 though
1999, DOE spent about $388 million on cleanup efforts.

DOE's plan for cleaning up the site includes activities, costs, and schedule
that are estimated to cost about $1.3 billion from fiscal year 2000 through
fiscal year 2010. We identified a number of challenges to accomplishing the
current cleanup plan, including uncertainty about the nature and extent of
contamination, technical risks, and optimistic assumptions about funding and
regulatory approvals. In addition, even when the cleanup identified in the
plan is complete, billions of dollars and many years will be required to
address items not included in the cleanup plan-such as about 1 million cubic
feet of waste and scrap material in DOE Material Storage Areas.

DOE Plans to Clean Up Six Major Categories by 2010 at a Cost of About $1.3
Billion

DOE's January 26, 2000, Paducah cleanup plan focuses on six major categories
of cleanup. The first category is groundwater contamination. About 10
billion gallons of groundwater contaminated with radioactive and hazardous
materials are flowing toward the Ohio River. For example, trichloroethene
(used as a degreaser and called TCE) has been found in the groundwater at
levels of up to 700,000 parts per billion; far in excess of the
Environmental Protection Agency's (EPA) drinking water standard of 5 parts
per billion. As interim measures, DOE has connected nearby residences to
municipal drinking water and constructed a system to pump some of the
contaminated water out and treat it.

The second category is surface water contamination in surrounding creeks and
ditches. One of the main sources of this contamination is the thousands of
tons of contaminated scrap metal stored at the plant. During rainstorms,
contamination washes from the scrap metal, and the runoff carries
contaminated soils and sediments into the ditches and creeks. By the end of
2000, DOE plans to have removed that portion of the contaminated scrap metal
called "Drum Mountain," which is made up of about 8,000 tons of crushed
drums that contained depleted uranium. But, after the crushed drums are
removed, 57,000 tons ,or 88 percent, of the total amount of scrap metal on
site will still have to be removed. DOE also plans to dredge ditches and
creeks and install basins to catch the contaminated water so it can be
treated.

Under the third category, DOE has identified 72 areas with contaminated
surface soils and has taken interim measures, such as installing erosion
control fences, to prevent further migration of the contamination; the
Department plans to excavate and dispose of about 35,000 cubic yards of
soil. The fourth category includes 12 waste burial grounds containing a
variety of radioactive and hazardous contaminants, including arsenic,
beryllium, and polychlorinated biphenyls (PCBs). DOE is planning to excavate
four or five of these areas and install a protective cover, or cap, over the
remaining areas. The fifth category is the equivalent of 52,000 barrels of
hazardous and low-level radioactive waste stored in various locations
on-site--almost 25 percent of the barrels are stored outdoors and are
deteriorating. Before it can ship this waste offsite, DOE must determine the
nature and extent of the waste's contamination and repack most of the
barrels to make them suitable for disposal. Under the sixth and last
category, two buildings that were used in the uranium enrichment process
until 1977, which are heavily contaminated, will be decontaminated and
removed.

DOE Faces Challenges in Achieving Its Paducah Cleanup Plan

DOE faces many challenges to completing its cleanup within planned costs and
schedules. Uncertainties about the extent, source, and nature of
contamination yet to be cleaned up could increase cleanup costs. For
example, the full extent of contamination in the surface water and soils
within and outside the plant boundaries remains to be determined and could
affect cleanup strategies and costs. While Kentucky prefers the installation
of eight or nine sedimentation basins as part of the surface water cleanup,
DOE has only budgeted for four.

Furthermore, uncertainties exist about the feasibility of available cleanup
technologies. Some of the technologies are new, and others remain untested
for the specific environment found at Paducah. For example, EPA officials
told us that difficulties with steam injection--which DOE plans to use to
treat the source of groundwater contamination--were encountered at another
site, and there are questions about whether the technology will work at
Paducah because of the site's complex geologic formation. DOE's ability to
treat the contaminated groundwater is also uncertain. DOE plans to install
about 4,000 feet of permeable treatment barriers across the paths of the
highest concentrations of contamination. Installing the barriers involves
injecting a gelatinous, gummy substance containing iron filings into the
aquifer at depths of about 120 feet. The technology is quite new, and the
potential for its success at Paducah is uncertain. For example, if
groundwater flows too quickly through the barrier and thus spends too little
time in the treatment zone, the barrier may not have enough time to fully
treat the TCE. In that case, the actions of the barrier's treatment zone
could change the TCE to vinyl chloride, which is even more toxic.

In addition to the technical uncertainties, the cleanup plan is built on
some optimistic financial assumptions. The plan assumes that federal funding
for cleanup at Paducah will increase to an average of $124 million annually
over the next decade--ranging from $78 million in 2001 to a high of $307
million in 2008-- compared with the annual average funding of $43 million
over the last 7 years.

The plan also includes optimistic assumptions about quickly reaching
agreement with the regulators on cleanup levels, strategies, and priorities.
In the past, regulators have disagreed with some of DOE's proposed
approaches. For example, Kentucky objected to DOE's cleanup of PCBs in soils
to EPA's standard of 25 parts per million for unoccupied space, saying that
it wanted the soil cleaned up to 1 part per million. The more stringent EPA
standard would allow for industrial or residential use. The resolution of
this issue has been deferred until DOE submits its plans for surface water
cleanup. If DOE receives less funding than assumed and/or eventually adopts
a more stringent cleanup level than currently planned, total costs to
complete the overall cleanup will grow.

DOE's Cleanup Plan for Paducah Does Not Address All Areas that Require
Cleanup

Even when DOE completes the cleanup that it has planned, billions of dollars
and many years will be needed to address areas at the Paducah site that are
not included in the cleanup plan because they fall under the purview of a
different departmental program. The plan excludes nearly a million cubic
feet of waste and scrap contained in 148 DMSAs located across the site.
Materials in these areas include thousands of barrels of low-level
radioactive waste, PCB waste, and asbestos waste; contaminated equipment;
various items and containers whose contents are unknown; and scrap metal.
DOE has not yet determined the exact nature and extent of contamination in
these areas, but it has identified 73 of them as posing a risk of an
uncontrolled nuclear reaction. In this case, such a reaction might produce a
burst of radiation that generally lasts several hours but is nto expected to
result in an explosion or release of radioactivity into the atmosphere. At
the time of our report, DOE officials said they planned to pay nearly $5
million to conduct a nuclear criticality safety review on the 10 DMSAs
posing the highest risk.

The cleanup plan also does not address 16 unused buildings and structures
that were originally used as part of the enrichment process. These buildings
and structures, as well as the DMSAs, are excluded from the plan not because
they require no action but because they fall under a different departmental
program-the Office of Nuclear Energy, Science, and Technology. DOE officials
told us that they are hesitant to transfer any more areas to the Office of
Environmental Management, the office responsible for cleanup, because this
office already has a large workload and funding for cleanup is limited.

In addition, before the site can be considered clean, DOE will need to
address almost 500,000 tons of depleted uranium stored on site as well as
decontaminate and decommission the uranium enrichment plant, when it ceases
operation. DOE estimates that it may cost between $1.8 billion and $2.4
billion to convert the depleted uranium to a more stable form and remove it
from the site. In addition, according to DOE's January 1998 estimate,
another $1 billion would be needed for final decontamination and
decommissioning activities when the United States Enrichment Corporation
ceases operations at Paducah and the plant is returned to DOE.

To ensure that cleanup risks and priorities are established on a
comprehensive, sitewide basis and that a more comprehensive picture of the
cleanup is presented to the Congress, our April report recommended that the
Secretary of Energy transfer the responsibility for the DMSAs and the unused
buildings and structures from the Office of Nuclear Energy to the Office of
Environmental Management. We also recommended that DOE address in the
cleanup plan, regardless of the current organizational responsibility, any
and all materials at the site that are potential health hazards and
reexamine the sitewide contamination risks and cleanup priorities, costs,
and schedules. In response to our recommendations, DOE officials announced,
in July 2000, that it will prepare an integrated sitewide plan that will
address all aspects of the site requiring cleanup. However, it has not
transferred the responsibility for these areas to the Office of
Environmental Management. Without doing so, it will be more difficult to
establish priorities and conduct the cleanup in a comprehensive manner.

ITP Fails to Work After 10 Years and a Half Billion Dollars

The ITP process was selected in 1983 as the preferred method for separating
high-level waste from the 34 million gallons of liquid waste stored at the
Savannah River site--a step considered necessary to effectively handle this
large quantity of waste. In 1985, DOE estimated that it would take about 3
years and $32 million to construct the ITP facility. After a number of
delays, the ITP facility was started up in 1995, but safety concerns about
the amount of explosive, toxic benzene gas that the facility generated
halted start-up operations. In February 1998, after about a decade of delays
and spending almost a half billion dollars, DOE suspended the project
because it did not work as safely and efficiently as designed. DOE then
directed that its contractor begin a process to identify and select an
alternative technology. Although originally expected to be completed in the
fall of 1999, that selection process continues today with additional
research and evaluations being made on four alternatives. DOE's plan calls
for making a decision on the preferred alternative in June 2001.

A number of factors combined to cause DOE and Westinghouse to spend almost a
half billion dollars and take about a decade to decide that the ITP process
would not work as safely and efficiently as designed. First, because of
ineffective DOE and contractor management and oversight during the 1980s and
early 1990s, ITP problems were not being adequately dealt with. In addition,
DOE and the contractor experienced difficulty managing the project's
start-up operations. Furthermore, there was limited oversight and visibility
of the project because of the budgetary treatment it received. Lastly, the
ITP process and the generation of toxic, explosive benzene were not fully
understood.

Weaknesses Existed in Contractors' Management and DOE's Oversight

The principal factors contributing to the delays and increased costs of the
project were ineffective management and oversight by DOE and its operating
contractors. A number of these problems were noted in 1993 by a DOE
technical review team (referred to as the Red Team) that examined the
project as well as in semiannual evaluations of contractor performance.

The Red Team reported that the contractor tended to use "reactive, discovery
management" to react to problems after they occurred, rather than working to
prevent problems in the first place. It found that this approach resulted in
a high potential for inadequate process development, lengthening the
project, and increasing its costs. The Red Team also reported that DOE
oversight and support functions at the Savannah River site were not adequate
because DOE lacked the necessary personnel. As a result, DOE's guidance and
responsiveness to Westinghouse, the site contractor, were limited. Finally,
the team found that DOE's organizational responsibilities appeared unclear
and the DOE staff were forced to respond in a reactive manner to emerging
issues.

Contractor management problems also surfaced repeatedly in the semiannual
evaluations DOE performed to assess Westinghouse's eligibility for award
fees. We found that in 14 of the 16 evaluations performed from April 1990
through March 1998, DOE identified weaknesses needing attention in
contractor management or ITP planning activities. For example, a 1992
evaluation stated that performance against planned work was not adequately
monitored and that technical documents had deficiencies indicating a lack of
management attention. A 1995 evaluation noted that insufficient resources
had been assigned to meet the project schedule. In addition, a 1996
evaluation noted that while safety concerns about benzene gas from the ITP
process was a key issue, the implementation of a program to resolve the
benzene issue had been fragmented and no single manager had been given
overall responsibility for resolving it.

Managing the Project's Start-Up Posed Difficulties

The ITP project was managed on a fast-track schedule--concurrent design and
construction--with an emphasis on pushing ahead in the belief that the
problems could be solved later. Rather than expediting the ITP project, this
approach caused a series of delays that prolonged the project for 10 years
while costs mounted. A number of studies in the early 1990s noted this
problem, as the following examples show.

   * A 1992 Westinghouse management assessment concluded that a number of
     start-up activities were begun prematurely--before the foundation for
     an efficient program was in place. The key weaknesses observed included
     a lack of a technical baseline and a potential for inconsistencies
     among the project's various activities because they were not completely
     integrated.

   * Our 1992 report on Savannah River's Defense Waste Processing Facility,
     which included the ITP project, cited the fast-track management method
     being used as contributing to the project's cost growth. We also stated
     that there was a risk associated with that method, especially when used
     with unique and complex facilities. We recommended that an assessment
     comparing ITP with an alternative technology be made.

   * The 1993 Red Team report noted that the project's start-up was not
     being managed as a first-of-a-kind chemical-processing system. It
     stated that Westinghouse was not following the accepted chemical
     engineering practice of completing process development, demonstrating
     the operability of the process on a pilot scale, and assessing all
     long-term impacts and requirements for sustaining the process before
     beginning plant operations. The Red Team recommended that alternatives
     to the ITP process be considered.

In response to our 1999 report, Westinghouse acknowledged that the risks
associated with new applications of existing technologies were not managed
well on the ITP project-that is, enough time was not built into the schedule
to allow for the kinds of technical problems that arose. DOE Savannah River
officials noted that ITP was a first-of-a-kind process and that because of
funding constraints, they were scaling up the technology from lab tests to
full-scale without the benefit of additional test facilities. Furthermore,
DOE officials said they considered alternatives to ITP as the project
progressed. DOE said it determined that risks were inherent in ITP and the
alternative processes but that costs still favored the ITP process, so the
project proceeded. The DOE Savannah River High-Level Waste Division Director
said the Department is now attempting to manage the high-level waste
program, of which ITP is a part, using a systems engineering approach that
dictates that more testing be done up front.

Oversight and Visibility Were Limited by Budgetary Treatment

DOE paid for the ITP project with operating funds that are subject to less
oversight and visibility than capital construction funds. Capital
construction projects are subject to periodic reviews and reports, and those
costing $5 million or more are shown as line items in the budget requests
that DOE submits to the Congress. Projects paid for with operating funds do
not receive such scrutiny. DOE officials said they used operating funds for
the ITP project because, throughout the life of the project, they had
expected the technical issues to be solved shortly, thus not warranting its
conversion to a capital construction project, which would be funded as a
line item in DOE's budget request.

This is not a new issue. We raised concerns about this practice in our 1992
report, noting that because projects associated with Savannah River's
Defense Waste Processing Facility were being funded from operating accounts,
the Congress was not receiving enough information to fully understand the
magnitude of the continuing cost increases and delays.

Inadequate Understanding of the ITP Process Extended the Project

DOE and its contractors did not completely understand the ITP chemistry that
caused excess benzene to be generated. Earlier in the project, the
Westinghouse staff at the Savannah River Site identified the principal cause
of benzene generation as the decomposition of the chemical (sodium
tetraphenylborate) that was added to the tank waste during the ITP process
to separate the high-level waste from the liquid waste solution. The benzene
was thought to become trapped in the solution and be released with the
addition of water and mixing. In 1997, after a recommendation by the Defense
Nuclear Facilities Safety Board, additional research into the chemistry
revealed that a catalyst or catalysts that produced large amounts of benzene
were present in the waste solution.

The contractor based its initial belief on the results of the full-scale
test conducted in 1983 and on subsequent smaller-scale tests. For the 1983
test, sodium tetraphenylborate was added to a tank with about 500,000
gallons of waste. During the test, a good separation of high-level waste
occurred. However, a significant release of benzene was also observed--for 6
hours, the benzene levels were higher than the level that the instruments in
the tank could register. As a result, additional studies were conducted.

According to many DOE ITP project employees with whom we spoke, the test in
1983 was viewed as successful and provided credibility for the project's
technology. However, an ITP engineer told us that the fact that the benzene
level went over the instrumentation scale for 6 hours was not widely known.
The test results seemed to have been forgotten over time. For example, two
ITP project managers involved with the project since 1997 told us they were
unaware of this aspect of the test.

During the development of the ITP process, we and the Red Team raised
concerns about unresolved technical issues and the level of understanding
the ITP process, as shown in the following:

   * Our 1992 report raised concerns about the ITP process's unresolved
     technical issues and delays and recommended that the Secretary of
     Energy direct that an assessment of an alternative technology
     (ion-exchange process) be prepared to determine whether DOE should
     replace the ITP process.

   * In 1993, the Red Team noted that the chemistry of the ITP process was
     not adequately understood and that the ITP process appeared to cause
     more problems than it solved. These problems included a need to control
     benzene emissions; increased flammability risks; increased risk from
     aerosols, foams, and respirable particulates; increased chemical
     reactivity of high-level waste, leading to possible explosions; and the
     introduction of extremely complex organic chemistry.

   * The Red Team also questioned whether the chemical used in the ITP
     process--sodium tetraphenylborate--was the best way to remove cesium
     from the liquid waste. It concluded that effective technologies were
     available and could be implemented. It noted that if the state
     environmental regulators adopted a more restrictive benzene emissions
     policy, the entire high-level waste complex, as well as the Savannah
     River Site itself, would be better served by a thorough reevaluation of
     alternative technologies.

In response to our 1999 report, DOE Savannah River officials told us that
they considered the concerns raised but did not change their approach for a
number of reasons. In their view, in 1992 and 1993, ITP was considered to be
the best technology available for the type of high-level waste at the
Savannah River Site. In addition, they believed that they understood the
benzene generation problems and thought the problems had been identified,
evaluated, and resolved. A number of modifications were made to the ITP
facility, primarily to address the generation of benzene and to meet the
more stringent safety standards that were adopted for all DOE facilities.
Throughout this period, DOE Savannah River officials said that they
considered the ITP process to have the lowest technical risk and the lowest
cost of all the alternatives.

DOE Is Evaluating Four Alternatives to Replace ITP

Although pointed out by the Red Team, the Defense Nuclear Facilities Safety
Board, and us, the lack of understanding of the chemistry of the ITP process
may plague the selection of the replacement for ITP. In the fall of 1999,
the National Research Council released an interim report on the alternative
processes being considered for the high-level waste at the Savannah River
site. Regarding one of the alternative technologies, called small-tank
precipitation, which basically uses the same chemical to separate the
high-level waste as the ITP process does, the report found that Westinghouse
lacked an adequate understanding of the chemistry underlying the process
responsible for benzene generation. The Council further reported that in
place of such an understanding, Westinghouse appeared to be focusing on an
engineering design solution that was based on untested assumptions about
maximum likely benzene production. The Council believed it would be
advantageous in terms of time and cost to undertake this research and
development work before the process might be selected and deployed. The
alternative--namely, to proceed with deployment immediately and engineer
around the gaps in chemistry knowledge--carries a high technical risk and
could result in a repeat of the ITP failure. As a result of the National
Research Council report, DOE decided that further research and development
on each alternative was required to reduce technical uncertainty prior to
selecting a preferred alternative.

The National Research Council's report also suggests that Westinghouse may
have a bias for its process, which is the small-tank precipitation
alternative. The Council reported that the research and development resource
allocations have been markedly inequitable for the four alternative
processing options that DOE and the contractor are considering. It said that
this funding disparity appears to be primarily responsible for the different
levels of technical maturity of the four processing options, independent of
their likelihood of success. The Council found in its discussions with the
contractor and DOE staff that the contractor did not appear to be serious
about pursuing research and development on any option but small-tank
precipitation. These concerns were addressed when DOE removed research and
development management responsibility from Westinghouse for the other
options in October 1999 and limited its responsibility to the small-tank
precipitation process. Although the Secretary of Energy had announced in
April 1999 that a new contractor would be sought to continue work on
separation processes at Savannah River, Westinghouse remained responsible
for research and development on all the alternatives until October 1999.

In addition, DOE officials told us that (1) DOE has developed an action plan
and project schedule that includes the steps necessary for choosing a
preferred alternative by June 2001 and designing, constructing, and
operating the facility by 2010; (2) DOE is developing selection criteria
that will be used to pick the preferred alternative, which may include such
factors as technical maturity, risk, life-cycle cost, and implementation
confidence; and (3) DOE is using a technical working group to oversee the
research and development being undertaken.

- - - - -

In summary, Mr. Chairman, the issues we have raised today concerning these
two projects illustrate the types of issues that we have raised in the past
as part of the major performance and management challenges at DOE. For
example, we reported to the Congress in January 1999 that DOE has difficulty
completing large projects on time and within budget, that DOE contract
management remains vulnerable to risk, and that DOE's staff lack technical
and management skills. These were touched on in the examples we provided
today. While DOE has made improvements in all these areas, many of the
issues are at the heart of DOE's culture as an organization and will take
time and focused management attention to change. Continued oversight by this
and other committees will continue to spotlight the progress made and
challenges ahead to ensure that DOE continues to improve.

Mr. Chairman, this concludes our prepared statement. We will be pleased to
respond to any questions that you or Members of the Committee may have.

Contact and Acknowledgement

For future contacts regarding this testimony, please contact Ms. Gary L.
Jones on (202) 512-3841. Individuals making key contributions to this
testimony include Erin Barlow, Rachel Hesselink, and Glen Trochelman.

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