Until 2013, uranium was enriched in the United States both for national  security and commercial purposes. Tritium is a key isotope used in nuclear weapons. NNSA Is Taking or Plans to Take Four Actions to Extend Existing Inventories of Enriched Uranium to Address its Near-term Tritium Needs

NNSA is taking or plans to take four actions to extend its existing  inventories of unobligated enriched uranium to address its near-term  need for tritium and has generally identified the costs, schedules, and  risks for these actions. Based  on our review, the actual costs and schedules through October 2017  generally align with the estimates in NNSA’s October 2015 plan. NNSA  and GAO have identified some risks associated with two of these actions. One of these risks has been resolved; NNSA is taking steps to mitigate  another; while other risks, such as the uncertainty of future  appropriations, are unresolved. Under either  interpretation of the mission need statement, NNSA is not complying with  these directives because it is showing preference toward a particular  solution—building a new uranium enrichment capability—and the agency  has not included other options for analysis. NNSA’s Domestic Uranium Mission Need Statement Can Be Interpreted to Fulfill Multiple Mission Needs, Making it Inconsistent with DOE Directives

NNSA’s preliminary plan—as outlined in its domestic uranium enrichment  mission need statement—for analyzing options to supply enriched  uranium in the long term is unclear because the scope of the mission  need statement can be interpreted to fulfill more than one mission need,  and this is inconsistent with DOE directives. Specifically, NNSA’s October  2016 mission need statement—developed by NNSA’s Office of Domestic  Uranium Enrichment—identified two mission needs: (1) a need for  enriched uranium for a range of national security and other missions,  including LEU for tritium production, HEU for the U.S. Navy, and high- assay LEU for research needs; and (2) a specific need for tritium. According to DOE guidance for the mission need statement, the  mission need statement should be a clear and concise description of the  gap between current capabilities and the mission need. Without revising the scope of the mission need  statement to clarify which mission need it seeks to achieve and adjusting,  as appropriate, the range of preliminary options being considered in the  analysis of alternatives, NNSA may not consider all options that could  satisfy its ultimate mission need. Specifically, the limited scope of the cost estimates  mean that they do not reflect the full costs of building a uranium  enrichment facility that could eventually provide the capacity to enrich  enough uranium to meet multiple needs, not just tritium. According to DOE and NNSA documents and NNSA officials, NNSA  appears to favor an incremental approach to reestablishing a domestic  uranium enrichment capability. NNSA’s Preliminary Cost Estimates for the Uranium Enrichment Technologies it Considers Most Feasible Do Not Fully Meet Best Practices for Reliable Estimates

Even when assessed for a more limited scope—producing LEU for  tritium—NNSA’s preliminary cost estimates for the two uranium  enrichment technology options that the agency considers to be the most  feasible—the large and small centrifuge technologies—do not fully meet  best practices for reliable cost estimates, including those for early stages  of acquisition. The mission need  statement is also inconsistent with the directives’ requirement that the  mission need should be independent of a particular solution and not be  defined by a technological solution or physical end-item. By developing reliable cost estimates consistent  with best practices, NNSA will ensure that it has quality information to  make an informed decision about which option to select. (Recommendation 1)
The NNSA Administrator should—following clarification of the scope of  the mission need statement—ensure that the agency’s cost estimates for  whichever options it considers going forward are aligned with the scope of  the mission need that the enrichment capability is intended to fulfill and  that they are developed consistent with best practices. Appendix I: Objectives, Scope, and Methodology

The objectives of our review were to assess (1) the actions the National  Nuclear Security Administration (NNSA) is taking to extend its existing  inventories of enriched uranium to address near-term tritium needs and  the costs, schedules, and risks of those actions; (2) the extent to which  NNSA’s plan to analyze options for supplying enriched uranium in the  long term is consistent with Department of Energy (DOE) directives; and  (3) NNSA’s preliminary cost estimates for long-term uranium enrichment  technology options and the extent to which they meet best practices for  reliable estimates. To examine NNSA’s preliminary cost estimates for long-term uranium  enrichment technology options—the large and small centrifuges—and the  extent to which they meet best practices for reliable estimates we  compared these estimates to GAO’s Cost Estimating and Assessment  Guide (cost guide), which is a compilation of best practices that federal  cost estimating organizations and industry use to develop and maintain  reliable cost estimates throughout the life of an acquisition program. DOE’s cost guidance also describes good cost estimates as including a full life-cycle cost estimate, among  other things.
Why GAO Did This Study

NNSA has several mission needs for enriched uranium, including providing LEU to fuel a nuclear reactor that produces tritium—a key isotope used in nuclear weapons. NNSA has a pressing defense need for unobligated LEU to fuel this reactor, meaning the uranium, technology and equipment used to produce the LEU, must be U.S. in origin. Because the United States lost its only source of unobligated LEU production in 2013, the supply is finite.
A House Armed Services Committee report included a provision for GAO to assess NNSA's plans to manage tritium and enriched uranium. This report examines (1) the actions NNSA is taking to extend its existing LEU inventories to address near-term tritium needs; (2) the extent to which NNSA's plan to analyze long-term options for supplying enriched uranium is consistent with DOE directives; and (3) NNSA's preliminary cost estimates for long-term uranium enrichment technology options and the extent to which they meet best practices for reliable estimates. GAO analyzed NNSA plans on costs, schedules, and risks; compared them with its guide on best practices in cost estimating; and interviewed NNSA and other officials.

What GAO Found

The National Nuclear Security Administration (NNSA), a separately organized agency within the Department of Energy (DOE), is taking or plans to take four actions to extend inventories of low-enriched uranium (LEU) that is unobligated, or carries no promises or peaceful use to foreign trade partners until about 2038 to 2041. Two of the actions involve preserving supplies of LEU, and the other two involve diluting highly enriched uranium (HEU) with lower enriched forms of uranium to produce LEU. GAO reviewed these actions and found the actual costs and schedules for those taken to date generally align with estimates. NNSA and GAO have identified risks associated with two of these actions. One of these risks has been resolved; NNSA is taking steps to mitigate another, while others, such as uncertainty of future appropriations, are unresolved.
NNSA's preliminary plan for analyzing options to supply unobligated enriched uranium in the long term is inconsistent with DOE directives for the acquisition of capital assets, which state that the mission need statement should be a clear and concise description of the gap between current capabilities and the mission need. The scope of the mission need statement that NNSA has developed can be interpreted to meet two different mission needs: (1) a need for enriched uranium for multiple national security needs, including tritium, and (2) a specific need for enriched uranium to produce tritium. The DOE directives also state that mission need should be independent of and not defined by a particular solution. However, NNSA is showing preference toward a particular solution—building a new uranium enrichment capability—and the agency has not included other technology options for analysis. Without (1) revising the scope of the mission need statement to clarify the mission need it seeks to achieve and (2) adjusting the range of options it considers in the analysis of alternatives process, NNSA may not consider all options to satisfy its mission need.
Although the scope of the mission need statement is unclear, NNSA has prepared preliminary cost estimates for the two uranium enrichment technology options—the large and small centrifuge—that the agency considers to be the most feasible. However, these estimates are limited in scope and do not fully meet best practices for reliable cost estimates. Based on GAO's review of NNSA documents, NNSA appears to favor an incremental approach to reestablishing an enrichment capability that could ultimately meet all national security needs for enriched uranium. The estimates' scope is limited, however, in that they reflect only the costs of the first increment—producing LEU for tritium—and do not reflect the full costs of building a uranium enrichment facility that could meet the range of enriched uranium needs. GAO's cost guide—which provides cost estimating best practices—states that the scope of preliminary cost estimates should reflect full life-cycle costs. Also, NNSA's estimates for the two options minimally or partially met best practice characteristics for reliable cost estimates even when assessed for the more limited mission scope. For example, the estimates excluded certain costs and did not describe the calculations used. NNSA officials said that the cost estimates are preliminary and will be revised. By developing reliable cost estimates that are aligned with the revised mission need statement and consistent with best practices, NNSA will reasonably ensure that it has reliable information to make a decision about which option to select.

What GAO Recommends

GAO is making two recommendations, including that NNSA revise the scope of its mission need statement and ensure that the scope of its cost estimates are aligned with the revised statement while developing estimates consistent with best practices. NNSA described actions planned and in process to address both recommendations.