In that report, we identified two areas of misalignment  between NNSA’s modernization plans and the estimated budgetary  resources needed to carry out those plans, which could result in  challenges to NNSA in affording its planned portfolio of modernization  programs. Second, the costs of some major  modernization programs—such as for nuclear weapon refurbishments— may also increase and further strain future modernization budgets. Misalignment between Estimates and Plans May Result in Increased Cost and Schedule Risks and Raises Affordability Concerns

As we reported in April 2017, NNSA estimates of funding needed for its  modernization plans sometimes exceeded the budgetary projections  included in the President’s planned near- and long-term modernization  budgets. To help NNSA put forth more credible modernization plans, we  recommended in our April 2017 report that the NNSA Administrator  include an assessment of the affordability of NNSA’s portfolio of  modernization programs in future versions of the Stockpile Stewardship  and Management Plan, such as by presenting options (e.g., potentially  deferring the start of or canceling specific modernization programs) that  NNSA could consider taking to bring its estimates of modernization  funding needs into alignment with potential future budgets. DOE Annually Spends Billions on Cleanup, but the Cost of Its Environmental Liabilities Continues to Increase

DOE also faces challenges with addressing its environmental liabilities  and its cleanup mission. Specifically,  we found that the federal government’s environmental liability has been  growing for the past 20 years—and is likely to continue to increase—and  that DOE is responsible for over 80 percent ($372 billion) of the nearly  $450 billion reported environmental liability. Notably, this estimate does  not reflect all of the future cleanup responsibilities that DOE may face. In January 2017, we reported that the cost estimate for DOE’s  new approach excluded the costs and time frames for site selection  and site characterization. As a result, the full cost of these activities  is likely billions of dollars more than what is reflected in DOE’s  environmental liability. Since 1994, we have made at least 28 recommendations related to  addressing the federal government’s environmental liability to DOE and  others and 4 suggestions to Congress to consider changes to the laws  governing cleanup activities. Of these, 13 recommendations remain  unimplemented. DOE Has Taken Steps to Improve Management of Contracts, Projects, and Programs, but Challenges Remain

The Secretary of Energy has taken several important steps that  demonstrate DOE’s commitment to improving management of contracts  and projects. These changes were included in DOE’s revised project management  order, DOE Order 413.3B, issued in May 2016. As noted in the  memorandums, some of these changes are in response to  recommendations we made in prior years, such as requiring that projects  develop cost estimates and analyses of alternatives according to our best  practices. Challenges Persist in Several Areas

DOE’s recent efforts do not address several areas where it continues to  have challenges including (1) acquisition planning for its major contracts,  (2) the quality of enterprise-wide cost information available to DOE  managers and key stakeholders, (3) program and project management,  and (4) major legacy projects. DOE’s response to our recommendation is concerning because it  demonstrates that DOE does not fully appreciate its responsibility for  overseeing contractor costs. NNSA generally agreed with this recommendation and has ongoing  efforts to complete these actions. NNSA’s Nonproliferation Program Faces Performance Measurement and Program Management Challenges

Our previous work has found that NNSA also faces challenges  implementing its nonproliferation programs under its Office of Defense  Nuclear Nonproliferation (DNN), which implements nuclear  nonproliferation programs worldwide. Specifically,  In September 2017, we found that four DNN programs did not have  schedule and cost estimates covering their planned life cycles and did  not measure performance against schedule and cost baselines as is  recommended by program management leading practices. But we found that DNN’s program management policy,  which was updated in February 2017, did not outline requirements for  programs to establish life-cycle estimates or measure performance  against schedule and cost baselines. Although NNSA neither agreed nor disagreed with  the recommendation, it indicated that it plans to take action to revise  its policy to address the recommendation. Related GAO Products

The following is a selection of GAO’s recent work assessing the  Department of Energy’s management efforts, including at the National  Nuclear Security Administration and at the Office of Environmental  Management:  Nuclear Weapons: NNSA Should Adopt Additional Best Practices to  Better Manage Risk for Life Extension Programs. Commercial Nuclear Waste: Effects of a Termination of the Yucca  Mountain Repository Program and Lessons Learned.
Why GAO Did This Study

DOE's NNSA is responsible for managing the nuclear weapons stockpile and supporting nuclear nonproliferation efforts. DOE's Office of Environmental Management's mission includes decontaminating and decommissioning facilities that are contaminated from decades of nuclear weapons production.
Over the last few years, GAO has reported on a wide range of challenges facing DOE and NNSA. These challenges contribute to GAO's continuing inclusion of DOE's and NNSA's management of major contracts and projects on the list of agencies and program areas that are at high risk of fraud, waste, abuse, and mismanagement, or are in need of transformation. GAO also recently added the U.S. government's environmental liabilities to this list.
This statement is based on 25 GAO reports issued from April 2011 through January 2018 and discusses (1) challenges related to the affordability of NNSA's nuclear modernization plans; (2) challenges related to DOE's environmental liability; (3) the status of DOE's efforts to improve its management of contracts, projects, and programs; and (4) challenges facing NNSA's nonproliferation programs.

What GAO Found

The Department of Energy's (DOE) National Nuclear Security Administration (NNSA) faces challenges related to the affordability of its nuclear modernization programs. In April 2017, GAO found a misalignment between NNSA's modernization plans and the estimated budgetary resources needed to carry out those plans. Specifically, GAO found that NNSA's estimates of funding needed for its modernization plans sometimes exceeded the budgetary projections included in the President's planned near-term and long-term modernization budgets by billions of dollars. GAO also found that the costs of some major modernization programs—such as for nuclear weapon refurbishments—may also increase and further strain future modernization budgets. GAO recommended in April 2017 that NNSA include an assessment of the affordability of its modernization programs in future versions of its annual plan on stockpile stewardship; NNSA neither agreed nor disagreed with that recommendation.
DOE also faces challenges with addressing its environmental liabilities—the total cost of its cleanup responsibilities. In February 2017, GAO found that DOE was responsible for over 80 percent ($372 billion) of the U.S. government's estimated $450 billion environmental liability. However, this estimate does not reflect all of DOE's cleanup responsibilities. Notably, this estimate does not reflect all of the future cleanup responsibilities that DOE may face. For example, in January 2017, GAO found that the cost estimate for DOE's proposal for separate defense and commercial nuclear waste repositories excluded the costs and time frames for site selection and site characterization, and therefore full costs are likely to be billions of dollars more than DOE's reported environmental liabilities. To effectively address cleanup, GAO has made at least 28 recommendations to DOE and other federal agencies, which could reduce long-term costs as well as environmental risks more quickly. Of these, 13 remain not implemented.
DOE has taken several important steps that demonstrate its commitment to improving contract and project management, but challenges persist. Specifically, DOE's revised project management order, issued in May 2016, made several changes in response to recommendations GAO made in prior years, such as requiring that projects develop cost estimates and analyses of alternatives according to our best practices. However, DOE's recent efforts do not address several areas, such as acquisition planning for major contracts and aspects of program and project management, where the department continues to struggle. GAO has made several recommendations related to these areas, and DOE has generally agreed with and begun to take action on most of them.
Finally, NNSA faces challenges in implementing its nonproliferation programs. For example, in September 2017, GAO found that selected programs in NNSA's Office of Defense Nuclear Nonproliferation (DNN) did not measure performance against schedule and cost baselines, as recommended by program management leading practices because DNN's program management policy did not require programs to measure performance in this way. GAO recommended that DNN revise its policy to require programs to measure performance against cost and schedule baselines. NNSA indicated it plans to take action to revise its policy.

What GAO Recommends

GAO has previously suggested that Congress consider changes to the laws governing environmental cleanup activities. In addition to these suggestions, GAO has made numerous recommendations to DOE to address its management challenges.