DOE and the Defense Nuclear Facilities Safety Board have identified the following safety problems at its spent fuel storage basins:
The spent fuel, which is made of uranium and has been irradiated in a nuclear reactor, was not intended for long-term storage in water and is corroding and crumbling. Constructed in 1951, the basins are now well beyond their expected useful life of 20 years. They are seismically unsound, and at least one has leaked water directly to the surrounding soils. For example, from 1974 through 1979, about 15 million gallons of contaminated water leaked from one basin. In both incidents, it is likely that contamination reached the Columbia River. The existing storage poses risks of exposing workers, the public, and the environment to radioactive materials. The loss of water in the basins could also expose workers and the public to the airborne transmission of radioactive materials released from the corroded fuel and the sludge in the bottom of the basins. DOE believes that the dry storage of the spent fuel presents the best option for achieving these goals. The schedule has been revised twice since then, and in April 1998, the contractors proposed a new schedule that would begin the fuel’s retrieval in November 2000 and complete the project by December 2005. In a February 9, 1998, letter to this Committee, DOE stated that the estimates of spent fuel project costs of over $1 billion and 9 years to complete the project (the December 1997 revision) were still less than early estimates of the cost of addressing the spent fuel storage problem at Hanford, which were projected to cost up to $2 billion and take up to 15 years to complete. Some of the reasons for cost overruns and schedule slippage are similar to the management problems that have occurred on this spent fuel project. DOE insisted on a very optimistic schedule for the project because of the deteriorated condition of the spent fuel and the storage basins and the need to resolve the storage problems expeditiously. In addition, DOE officials thought that a tight schedule would force Westinghouse to accomplish the project more quickly. The proposal was developed by Westinghouse, the company that was the management and operations contractor at Hanford until October 1996. According to the Assistant Manager for Waste Management at Hanford, the optimistic schedule for the project reflected a trade-off between the health and safety risks associated with continuing to store the spent fuel in the basins and the management risks associated with setting an optimistic schedule and knowing that it would be difficult to meet. Management by Companies in Charge Exacerbated Problems With Original Schedule

During the project’s history, two different companies have been responsible for the project. Although Duke Engineering has recently made changes to its management team and operating procedures and Fluor Daniel has stepped up its oversight of the project, it is too early to tell if these changes will improve Duke Engineering’s ability to manage the project within cost and schedule constraints. In addition, we interviewed DOE and contractor officials, as well as officials from the Environmental Protection Agency and the Washington State Department of Ecology. To determine the major causes of schedule delays and cost increases, we reviewed DOE’s, the Safety Board’s, and the contractors’ records and reports.
Why GAO Did This Study

Pursuant to a congressional request, GAO discussed the Department of Energy's (DOE) project to change how DOE stores spent (or irradiated) nuclear fuel from its nuclear reactors at DOE's Hanford site in Washington, focusing on the: (1) risks posed by the storage of the spent nuclear fuel; (2) project's status; (3) major reasons for delays and cost increases; and (4) measures being taken to address these delays and cost increases.

What GAO Found

GAO noted that: (1) as stored, most of the spent fuel at Hanford presents a risk of releasing nuclear materials to the environment and a consequent danger both to workers and the public; (2) this fuel sits in two water basins that are well beyond their design life and are located just 1,400 feet from the Columbia River; (3) never designed for long-term storage in water, some of the spent fuel has corroded, creating a radioactive sludge that has accumulated in the storage basins; (4) because of leaks in the basins, workers risk exposure to radioactive materials if contaminated water is released to the soil, and the public risks exposure if this water moves through the soil to the river; (5) it is likely that radioactive materials carried in water leaking from one of the basins have reached the river at least twice in the past; (6) although progress has been made in designing and constructing the new facilities, the schedule proposed by the contractors in April 1998 is over 4 years behind the original schedule for completion, and the estimated costs to build and operate the project have almost doubled, to about $1.4 billion; (7) the date to begin moving the spent fuel out of the basins, an important milestone for the project, given the health and safety risks associated with storage conditions, will be delayed until November 2000--almost 3 years beyond the original plan; (8) DOE wanted a compressed schedule for completing the project because of safety concerns at the existing storage basins and because DOE thought that a compressed schedule would improve the contractor's performance; (9) the lack of adequate management by the companies working on the spent fuel project for DOE--Westinghouse Hanford Company, the company that managed the project until 1996, and Duke Engineering, the company now responsible for the project--also contributed to schedule delays and cost overruns; (10) furthermore, oversight by both DOE and its management and integration contractor at the Hanford site--Fluor Daniel Hanford, Inc.--was insufficient to ensure that problems were quickly corrected; (11) recent management changes have been made, and oversight of the project has become more aggressive; (12) in addition, Duke Engineering has replaced several key managers and reorganized its operations and procedures; (13) DOE is negotiating with its regulators--the Environmental Protection Agency and the Washington Department of Ecology--new milestone dates that DOE believes it can meet; and (14) these problems and unresolved technical questions will continue to affect DOE's ability to set reliable targets.