The office relies on plutonium analysis equipment to  support its work. For example, the first best  practice is for the schedule to capture all activities necessary to complete  the project. NNSA Did Not Identify the Plutonium Analysis Capacity That Its Revised CMRR Project Should Provide, So the Project May Not Meet DOE and NNSA Needs NNSA’s Requirements for the Revised CMRR Project Did Not Define the Plutonium Analysis Capacity the Project Should Provide

NNSA defined a set of requirements for the revised CMRR project, but  these requirements did not include key performance parameters, such as  the plutonium analysis capacity that the project should provide. NNSA officials and Los Alamos contractor representatives said that the  program requirements document for the revised CMRR project does not  contain a pit production-related performance parameter because NNSA  tasked the revised project only with replacing plutonium analysis  equipment that had been located in the Chemistry and Metallurgy  Research facility. NNSA’s Revised CMRR Project Has a Lower Estimated Total Cost than the Previously Approved CMRR Project, but Agency Estimates of Cost Savings May Be Overstated

The total estimated cost for the revised CMRR project is lower than the  total estimated cost for the previously approved CMRR project that  included constructing the CMRR nuclear facility, but estimates of cost  savings may be too high because the revised project includes less scope  and is likely to provide less plutonium analysis capacity. NNSA reported that it expected the nuclear  facility to support the production of up to 80 pits per year. According to NNSA officials and contractor representatives, NNSA’s  cancellation of the previously approved CMRR project’s nuclear facility  may yield benefits in terms of an improved funding profile. NNSA’s Schedule Did Not Include Most Activities Needed to Complete the Project

NNSA did not maintain a schedule for the revised CMRR project that  included all activities needed to complete the project and did not  sufficiently analyze risks to determine whether the project’s estimated  completion dates are reasonable. We reviewed an updated  project schedule from August 2015 and assessed the extent to which it  reflected best practices for creating a high-quality, reliable schedule. According to best practices, a  project team should develop and maintain an integrated master schedule  that includes the entire scope of work required for a project’s successful  execution. By maintaining a  schedule that is limited to short-term work ending in 2017, however,  NNSA and its contractor have limited insight into how current  performance affects completion dates beyond 2017, including completing  the first subproject to install analysis equipment in the radiological lab in  December 2019—in support of ending operations in the Chemistry and  Metallurgy Research facility—and completing the rest of the revised  CMRR project by 2024. These performance parameters are important because they define  how well a project will perform its functions, expressed in terms such as  capacity or throughput. NNSA needs a sufficient amount of  plutonium analysis capacity to support the agency’s pit production plans,  but it is currently unclear how well the project will support NNSA’s plan to  develop the capability to produce 50 to 80 pits per year by 2030. Recommendations for Executive Action

We are making seven recommendations to the Secretary of Energy. To ensure that NNSA will acquire sufficient plutonium analysis equipment  and space to meet its needs, including pit production to support critical life  extension programs, we recommend that the Secretary direct that the  Under Secretary for Nuclear Security, in his capacity as the NNSA  Administrator: update the program requirements document for the revised CMRR  project to identify a key performance parameter that describes the  plutonium analysis capacity the CMRR project is required to provide  to support specific pit production rates and  specify plans for how the agency will obtain additional plutonium  analysis capacity if the revised CMRR project will not provide  sufficient plutonium analysis capacity to support NNSA’s pit  production plans. Instead, NNSA stated that it  will perform an analysis to estimate a pit production capacity range that  the project will support and include a reference to this analysis in its next  revision to the program requirements document. GAO staff who made significant  contributions to the report are listed in appendix V.

Appendix I: Objectives, Scope, and Methodology

In this report, we assessed: (1) the extent to which the National Nuclear  Security Administration’s (NNSA) revised Chemistry and Metallurgy  Research Replacement (CMRR) project is expected to meet NNSA and  other Department of Energy (DOE) programs’ plutonium analysis needs  at Los Alamos National Laboratory; (2) the extent to which the Plutonium  Modular Approach is expected to meet plutonium analysis needs at Los  Alamos; (3) how the revised CMRR project’s scope and cost compare  with those of the previously approved CMRR project; and (4) the extent to  which the revised CMRR project’s schedule and cost estimates reflect  scheduling and cost estimating best practices.
Why GAO Did This Study

In recent years, NNSA has spent billions of dollars designing large construction projects, only to revisit options after cost increases and schedule delays. At Los Alamos, NNSA reversed its prior decision to build a nuclear facility as part of the CMRR project after spending $450 million. The facility was to provide analysis equipment needed to support the production of pits as part of nuclear weapons life extension programs. Instead, NNSA approved a revised CMRR project to install plutonium analysis equipment in existing facilities.
Senate report 113-44 includes a provision for GAO to review NNSA's revised CMRR project. GAO's report assesses (1) the extent to which the revised CMRR project is expected to meet plutonium analysis needs, (2) how its cost and scope compare to the previously approved project, and (3) the extent to which its schedule and cost estimates reflect best practices, among other objectives. GAO reviewed project documentation, assessed cost and schedule estimates against GAO-identified best practices, and interviewed NNSA and DOE officials and CMRR contractor representatives.

What GAO Found

The Department of Energy's (DOE) National Nuclear Security Administration (NNSA) defined requirements for the revised Chemistry and Metallurgy Research Replacement (CMRR) project to provide plutonium analysis equipment at its Los Alamos site but did not specify the capacity for analyzing plutonium that the project should provide, making it possible that the project would not meet plutonium analysis needs. NNSA policy states that project requirements should include key performance parameters, which describe how well a project will perform its functions, expressed in terms such as processing rate or capacity. However, NNSA did not identify a key parameter that addresses a primary function of the project's analysis equipment—to analyze plutonium in support of producing an essential part of a nuclear weapon, known as a pit. NNSA has determined that it needs sufficient analysis capacity to support producing pits, including at planned rates of 10 pits per year in 2024 and 50 to 80 pits per year by 2030, but an NNSA analysis shows that the revised CMRR project may not support these rates. NNSA officials said the project's requirements do not include a pit production-related parameter because NNSA only tasked the CMRR project with replacing analysis equipment used in an aging facility, regardless of analysis capacity. Not identifying this parameter likely contributed to the project potentially not providing sufficient analysis capacity to support planned pit production and may have contributed to different understandings among senior agency officials about how well the project will support pit production. By identifying a pit production-related parameter that describes the analysis capacity that the revised CMRR project is to provide, NNSA could clarify the extent to which the project will support such pit production.
NNSA's total estimated cost for the revised CMRR project is lower than the cost of the previously approved CMRR project, which included a large nuclear facility, but NNSA may have overstated its cost savings. NNSA's estimated savings from cancelling the previously approved nuclear facility did not account for work that the agency deferred to future projects, including a storage vault and tunnel. NNSA's approach for the revised CMRR project allows costs to be spread out over time, improving NNSA's ability to concurrently fund other work. However, the revised CMRR project includes less scope and is likely to provide less plutonium analysis capacity than the previously approved nuclear facility.
The revised CMRR project schedule and cost estimates only partially met best practices. For example, the schedule did not include most of the work needed to complete the project. According to best practices, agencies should develop and maintain a schedule that contains all necessary work activities, but the revised project's schedule was limited to near-term work ending in 2017. When NNSA created the revised CMRR schedule, DOE did not specifically require projects to maintain complete schedules after project approval. Since then, DOE has issued a memorandum directing that all schedules contain the entire scope of work, but NNSA does not plan to develop a complete schedule for the entire CMRR project until mid-2017. Continuing to rely on a partial schedule limits managers' insight into how current activities might affect future completion dates, including NNSA's goal to end plutonium work in an aging facility at Los Alamos.

What GAO Recommends

GAO is making seven recommendations to NNSA, including that it identify a pit production-related parameter for the revised CMRR project and develop a CMRR project schedule that includes all necessary work activities. NNSA generally neither agreed nor disagreed with the recommendations but described some actions it was taking. GAO continues to believe that the recommendations are valid, as discussed in this report.