Nuke Waste Facility Could Go $40 Billion Over Budget
Policy + Politics

Nuke Waste Facility Could Go $40 Billion Over Budget

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The Department of Energy has already shoveled more than $4 billion into a facility in South Carolina intended to safely dispose of weapons-grade plutonium left over from the Cold War. But management problems, oversight issues and high staff turnover rates has caused the project to go years behind schedule and billions over budget.

By the time it’s said and done, the Mixed Oxide Fuel Fabrication Facility, is projected to cost upwards of $47 billion—about $46 billion more than originally estimated, according to an analysis by the Aerospace Corporation.

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Under an agreement with Russia signed in 2000, the U.S. is required to dispose of 34 metric tons of surplus weapons-grade plutonium. One of the safest ways to do that, according to the Department of Energy, is to convert the plutonium into commercial nuclear fuel or MOX fuel via a mixed oxide facility.

The plan would be to eventually sell the fuel to utility companies, but there isn’t yet a market for MOX fuel in the United States. It’s unclear whether the U.S. would sell it to Belgium, Switzerland, Germany and France, which do use MOX fuel. The Energy Department has suggested that it might subsidize the sale of the fuel, according to USA Today. However, that would only happen if and when the facility is open for business.

The project in South Carolina is the first and only of its kind in the country. However, years of setbacks and cost overruns have inspectors, lawmakers and administration officials considering whether it should just be scrapped.

The MOX facility, managed by the National Nuclear Security Administration, was originally estimated to cost about $1.6 billion back in 2004, and be completed by 2007. However, management and oversight issues as well as technical problems have set the project back. Now officials say it won’t be completed until at least 2020.

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Inspectors blame the schedule delays and cost overruns on poor planning.

A report released by the DOE’s Inspector General last year said that the original cost estimate of just over $1 billion was established before the design work for the project was 90 percent complete.

The company building the plant, Shaw-Areva Mox Services, along with Areva, a French company that owns 30 percent of the contract, blamed the increasing construction costs on the high rate of worker turnover at the facility. 

David C. Jones, a senior VP of Area, told The New York Times that getting and keeping qualified and trained welders and other experienced workers on the job was an ongoing problem. 

Then there’s the issue of addressing the risks of having plutonium at this facility---that could get into the wrong hands.

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"Converting this plutonium to a form that is harder to steal or reuse in nuclear weapons is a critical long-term goal," Edwin Lyman, a senior scientist with the Union of Concerned Scientists (UCS), said in a statement.

The risks and costs were understated in the original design plans, the IG found. Now, the federal government requires all cost estimates to be made after that benchmark. 

Others say the project could cost even more than the government is projecting. A separate estimate by the Project on Government Oversight, which has called on Congress to scrap the project and look for alternatives, estimates that total costs could soar as high as $114 billion, depending on whether or not Congressional appropriations remain steady at $300 million a year.

Interestingly, an analysis by Stanford University in 2012 pegged the cost of building a brand new nuclear plant between $5 billion and $12 billion.

Last week, the House Armed Services Committee approved an additional $345 million for fiscal 2016 as part of the National Defense Authorization Act that will go toward construction on the facility. 

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Rep. Joe Wilson, a Republican from South Carolina, touted the newly secured funding as a victory.

“It would not be in the interests of the American people not to finish (the MOX project),” he said in an interview South Carolina Radio Network. “It needs to be finished so that South Carolina is not left as a repository for weapons-grade plutonium.”

Wilson disputed the newest cost estimates of the MOX facility, saying it was impossible for it to have such an “astronomical” increase when the project is nearly “65 percent complete.”

However, others disagree—including two independent watchdogs based in Washington—POGO and Taxpayers for Common Sense, which just sent a letter to lawmaker urging them to throw in the towel on the project. 

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“We think this program has already failed the viability test. Halt funding to the MOX program now,” the groups said in the letter. “Don’t let nuclear waste become a symbol for government waste.”

Separately, the administration has also made attempts to scale back the project and seek alternatives.

In 2013, the DOE planned to place the project on “cold standby” while it searched for alternatives to dispose of the plutonium. However, that changed when South Carolina sued the administration saying the funding had to be eliminated through Congress—not the administration. The administration reversed its decision to keep the project idling and South Carolina ultimately dropped the suit.

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Of course, Wilson and other members of Congress like Congressman James Clyburn and Sen. Lindsey Graham – both representing South Carolina -- aren’t likely to approve yanking funding from the project and risk eliminating some 1,800 jobs.

Even deficit hawks like Former Sen. Jim DeMint (R-SC) have protected the facility. In 2009, he said the project "is at the center of the nuclear renaissance," according to the Associated Press.

Meanwhile, the NNSA, which distributed the new cost estimate of the project to Congress in a report not yet made public, also included a cost estimate of an alternative option. NNSA said turning the plutonium into reactor fuel by mixing it with classified material and burying it, would likely cost about $17.2 billion—well below what MOX will ultimately cost. 

Lyman and his advocacy group have been aggressively urging Congress to consider the alternatives. 

“These eye-popping numbers just underscore how completely unsustainable the MOX program is,” Lyman said. “We have to stop wasting more money on a white elephant.”

For now, the project is expected to continue.

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