Background

Nuclear research reactors are used for training and research purposes  throughout the world. Research reactors are generally smaller than nuclear  power reactors, ranging in size from less than 1 to 250 megawatts  compared with 3,000 megawatts generated by a typical power reactor. In  addition, unlike power reactors, many research reactors use HEU fuel  instead of LEU in order to produce the appropriate conditions in the  reactor cores for conducting a wide variety of research. DOE has identified  161 operating research reactors that were designed to use HEU fuel and  has included 105 of them in the reactor conversion program. The research  reactors included in the program are spread out among the United States  and 40 other countries, including Canada, France, Germany, and Russia  (see fig. 1).
In addition to the 105 research reactors covered under the reactor  conversion program, DOE has targeted six medical isotope producers that  use HEU as an ingredient in their production processes, including four  large medical isotope producers located in Belgium, Canada, the  Netherlands, and South Africa.
For a variety of reasons, DOE has excluded from its reactor conversion  program 56 research reactors that use HEU fuel, including 9 in the United  States. Some of the reactors are used for military or other purposes, such  as space propulsion, that require HEU. Others are located in countries such  as China that so far have not cooperated with the United States on  converting their reactors to LEU. Finally, the time and costs associated  with developing LEU fuel for some of the reactors may exceed their  expected lifetime and usefulness.
The United States has historically provided nuclear technology to foreign  countries in exchange for a commitment not to develop nuclear weapons.  Starting in 1953, the Atoms for Peace program supplied research reactors  and the fuel needed to operate them to countries around the world. The  research reactors supplied by the Atoms for Peace program initially used  LEU fuel, but many countries gradually switched from LEU to HEU in  order to conduct more advanced research. In addition, HEU fuel could  remain in the reactor core longer and was less expensive than LEU fuel. By  the late 1970s, most research reactors were using HEU fuel and the United  States was exporting about 700 kilograms of HEU a year to foreign  research reactors. Like the United States, the Soviet Union also exported  research reactors and the HEU fuel to operate them to other countries.
In order to achieve the program’s objective of reducing the use of HEU in  civilian research reactors, Argonne is developing new LEU fuels in  cooperation with counterparts in other countries, including Argentina,  France, and Russia. Developing LEU fuels involves testing fuel samples in  research reactors to determine how the fuels behave under normal  operating conditions. Fuel manufacturers and reactor operators around the  world participate in the program by manufacturing and testing LEU fuels.  Owners of foreign research reactors fund conversion of their reactors from  HEU to LEU. In 1993, Argonne expanded the reactor conversion program  to include cooperation with Russia on the conversion of Russian-supplied  research reactors to LEU fuel. The Soviet Union had independently  initiated a program in 1978 to reduce the enrichment of HEU fuel in  research reactors but suspended the program in 1989 due to lack of  funding. Russian-supplied research reactors use fuels manufactured in  Russia that are not interchangeable with fuels used by U.S.-supplied  research reactors. Therefore, DOE’s reactor conversion program  differentiates between U.S.-supplied and Russian-supplied research  reactors.
Since the reactor conversion program’s inception in 1978, 39 of the 105  research reactors included in the program have either converted or are in  the process of converting to LEU fuel. (See app. II for a list of converted  research reactors.) Of the remaining 66 research reactors that still use  HEU fuel, 35 can convert using currently available LEU fuels but have not  done so, and 31 cannot convert to any currently available LEU fuels and  still require HEU in order to conduct the research for which they were  designed (see fig. 2).
A research reactor can begin the conversion process after a suitable LEU  fuel is developed and available commercially. The decision to convert from  HEU to LEU also depends on research reactor owners having the necessary  financial resources, including for the purchase of new fuel. In the United  States, NRC regulations require that research reactors under its  jurisdiction, including reactors operated by universities, convert to LEU  fuel when an LEU fuel that can be used to replace HEU fuel has been  developed and when federal funding is made available for the conversion.   The conversion process begins with analyses to determine whether the  reactor can safely convert and the impact of conversion on the reactor’s  performance. After the analyses are completed and regulatory approval for  conversion is obtained, the operator can remove the HEU from the reactor  and replace it with the new LEU fuel. The HEU fuel can be disposed of  once it has been removed from the reactor core and has cooled.

	Many Domestic and Foreign Research Reactors Are Still Using Weapons-Usable Uranium Even Though They Could Operate on Low Enriched Uranium

According to Argonne’s analysis, conversion to LEU fuel is technically  feasible for 35 of the 66 research reactors worldwide that still use HEU  fuel. However, only 4 of the reactors—3 foreign reactors that use U.S.- origin HEU and 1 Russian-supplied reactor—currently have plans to  convert. Eight U.S. research reactors, including 6 university reactors, could  convert to LEU fuel, but according to DOE officials, DOE has not provided  the funding to convert them. In addition, DOE has not removed HEU fuel  from a university research reactor that has been storing HEU since it  converted to LEU in 2000. According to Argonne officials, of the 20 foreign  research reactors that currently use U.S.-origin HEU fuel, 14 do not have  plans to convert to LEU because they generally have a sufficient supply of  HEU and either do not want to incur the additional cost of conversion or do  not have the necessary funding. Finally, since DOE’s reactor conversion  program initiated cooperation with Russia in 1993, no research reactors  that use HEU fuel supplied by Russia have converted. According to  Argonne officials, only 1 of 7 Russian-supplied research reactors that could  use LEU fuel is scheduled to convert. They said that 5 other Russian- supplied reactors are likely to convert to LEU fuels that are currently  available or are expected to become available within the next year.

		Eight Research Reactors in the United States Could Convert to Low Enriched Uranium but Still Use Weapons-Usable Uranium

In the United States, there are 6 university research reactors and 2 other  research reactors that could convert to LEU fuel but still use HEU fuel.  Although DOE has funded the conversion of 11 university research reactors  to LEU fuel, the last university reactor converted in 2000. DOE officials said  DOE has not provided the funding to convert the 6 remaining U.S.  university reactors. DOE recently added 2 other domestic reactors to the  reactor conversion program, and neither of these reactors currently has  plans to convert to LEU, also because DOE has not provided the necessary  funding. (See table 1 for a list of the 8 reactors.)
In addition, the university research reactor that converted to LEU in 2000 is  still storing HEU fuel because DOE has not removed it. Because the reactor  now uses LEU fuel and has no need for HEU, the reactor operator told us  that he is eager to return the HEU to DOE for long-term storage and  disposal. DOE has a separate program that supports university research  reactors, including provision of DOE-owned fuel, and funds their  conversion to LEU and removal of spent fuel. According to the DOE  official in charge of the university reactor support program, the program  has limited funding, and requests for additional funding to support  conversion have not been approved by the Office of Management and  Budget. Furthermore, the university reactor support program did not  receive additional funding to remove HEU fuel from the research reactor  that converted to LEU in 2000 until fiscal year 2004, after a group of  domestic research reactor operators successfully lobbied Congress to add  $2.5 million to the program’s budget to pay for the removal of spent fuel  from the reactors.
Officials at NRC, which regulates the 6 university reactors, told us that they  consider the conversion of the reactors to LEU, the timely removal of HEU  fuel after conversion, and the removal of HEU from the reactor that  converted to LEU in 2000 as a security enhancement and one of their  priorities. NRC officials said that converting the 6 reactors is technically  feasible and that the delay in converting the reactors is purely a matter of  funding and should be expedited by DOE. However, DOE officials said that  DOE had not made the conversion of these reactors a priority.  Furthermore, while operators at all 6 universities told us they are willing to  convert to LEU fuel, they said it is not a high priority because they do not  consider their HEU fuel to be a likely target for theft. For example, one  reactor operator explained that the reactor is structured in such a way that  the HEU is located inside a concrete enclosure that even experienced  reactor staff need almost 2 days to access. These 6 reactors use only a  small amount of HEU fuel—less than a kilogram per year, which is not  enough to make a nuclear weapon. In contrast, there are other research  reactors included in DOE’s reactor conversion program that are larger than  the 6 university reactors and use tens of kilograms per year.
Nevertheless, operators of the 6 university research reactors said they  would convert to LEU when DOE provides funding. Furthermore, the DOE  official in charge of the university reactor support program said that  converting domestic university reactors is an issue of U.S. nonproliferation  policy. He said that converting domestic reactors to LEU would support  U.S. efforts to influence foreign reactors to convert to LEU in accordance  with the U.S. nonproliferation policy to reduce the use of HEU in civilian  research reactors worldwide. Although they did not consider conversion a  priority from a security perspective, two of the university reactor directors  we spoke with recognized the importance of converting university reactors  to LEU as part of U.S. nonproliferation policy.
According to DOE officials, conversion for each reactor is projected to cost  between $5 million and $10 million. However, a project engineer at DOE’s  Idaho National Engineering and Environmental Laboratory who tracks  DOE expenditures on conversions of U.S. university reactors had originally  told us that conversion would cost between $2 million and $4 million per  reactor, depending on the type of reactor. DOE could not provide  documentation to support either of the estimates. DOE officials said that  conversion costs for 4 of the university reactors are higher because their  fuel is no longer manufactured in the United States and must be purchased  in France.
Other than funding, there are no significant obstacles to converting the 6  university reactors to LEU. Based on our visits to 3 converted university  research reactors and interviews with Argonne officials and the operators  of the 6 remaining university reactors, converting to LEU does not reduce  the performance of the reactors to the point that they cannot be used to  conduct research and train students effectively. Operators at 5 of the 6  university reactors still using HEU fuel told us they expected performance  to be adequate after conversion. In addition, operators of converted  reactors told us that using LEU instead of HEU reduced security concerns  and had a minimal impact on the cost of operating the reactors. Argonne  officials said that one of their objectives when providing technical  assistance to convert reactors to LEU is to complete the process with only  minimal effects on performance and operating costs. In fact, two reactor  operators (one in Rhode Island and one in Massachusetts) told us that  performance at their reactors had improved as a result of conversion.
According to Argonne officials, 2 other reactors in the United States (the  DOE NRAD and General Electric NTR reactors) could convert to LEU but  are not currently planning to do so. The officials said they recently added  these 2 reactors to the scope of the reactor conversion program so that the  program would be comprehensive in its coverage of civilian research  reactors that use HEU. The NRAD research reactor is a DOE reactor, and  DOE would have to fund the purchase of new LEU fuel if a decision were  made to convert the reactor. According to a DOE official responsible for  the reactor, the budget for the NRAD reactor is limited, and purchasing new  LEU fuel to convert the reactor would take funding away from other  activities at the facility where the reactor is located. The DOE official  considers the conversion of this reactor a lower priority because it has a  sufficient supply of HEU fuel to last for the life of the reactor and because  the facility has other nuclear material that would be more attractive to  terrorists than the HEU fuel in the reactor. The General Electric NTR is a  privately owned reactor and is also not required to convert until DOE  provides funding.

		Twenty Foreign Research Reactors Continue to Use Weapons-Usable Uranium Fuel

Fourteen of the 20 foreign research reactors that currently use U.S.-origin  HEU fuel do not have plans to convert to LEU. According to Argonne  officials, these reactors generally have a supply of HEU sufficient to last  many years (in some cases for the life of the reactor) and either do not  want to incur the additional cost of conversion or do not have the  necessary funding. Three of the reactors are planning to convert to LEU,  and 3 others currently plan to shut down (or, in the case of 2 reactors,  convert to LEU fuel if they do not shut down). See table 2 for a list of the 20  reactors.
Some of the foreign research reactors would like to convert but do not have  the necessary funding. For example, the operator of a research reactor in  Jamaica told us that converting to LEU would improve the reactor  performance but that purchasing LEU fuel for the reactor would cost $1.5  million, which is more than the reactor operator can afford. Therefore, the  reactor operator is planning to continue using its current supply of HEU,  which will last possibly 20 years. Similarly, according to Argonne officials,  the reactor operator in Mexico would be willing to convert to LEU but does  not have the necessary funding. While funding may not be an issue for  other foreign reactors, many of them are designed to operate on a small  amount of fuel meant to last for the life of the reactor. Converting to LEU  would require the disposal of the fuel that the reactor operator had already  purchased and is still usable. According to Argonne officials, operators of  certain reactors in France, Japan, the Netherlands, and the United Kingdom  do not have plans to convert because the reactors have lifetime cores that  do not need to be replaced.
To support the objective of the reactor conversion program to reduce and  eventually eliminate the use of HEU in research reactors, the United States  has implemented policies designed to influence foreign research reactors  to convert to LEU. For example, DOE’s Foreign Research Reactor Spent  Nuclear Fuel Acceptance program provides foreign reactors that use HEU  fuel of U.S.-origin the opportunity to return their spent fuel to the United  States if they agree to convert their reactors to LEU fuel. In addition, the  Energy Policy Act of 1992 authorizes NRC to approve the export of HEU to  foreign research reactors only if the recipients agree to convert the  reactors once a suitable LEU fuel is developed. Since there are limited  suppliers of HEU fuel and few options for disposing of spent fuel, the U.S.  policies in support of the reactor conversion program have been effective  in influencing some research reactors to convert to LEU. In particular, of  the 20 foreign reactors that can convert to LEU but are still using HEU, the  2 that use the greatest amount of HEU per year are planning to convert by  2006. One research reactor in the Netherlands (HFR Petten) formally  agreed with the United States to convert to LEU in order to continue  receiving U.S.-origin HEU fuel until conversion could take place and to ship  spent fuel back to the United States. The U.S. policies in support of  conversion were effective in influencing the reactor operator because the  reactor uses 38 kilograms of HEU fuel per year and regularly needs to  obtain new HEU fuel and dispose of spent fuel. Similarly, the FRJ-2 reactor  in Germany has an agreement with DOE to convert to LEU fuel as a  condition of returning spent fuel to the United States.
However, U.S. policies in support of the reactor conversion program do not  influence foreign reactors using so little HEU that they can operate for  many years without replacing their fuel or disposing of spent fuel. While  Argonne provides technical assistance for conversion, current DOE policy  precludes purchasing new LEU fuel for foreign reactors that use U.S.-origin  HEU fuel. Under this policy, purchasing new LEU fuel—which, according  to a DOE project engineer, is the main cost of conversion—is the  responsibility of the reactor operator. According to a DOE official, DOE has  paid for new LEU fuel only once, in Romania, in exchange for the return of  Russian-origin HEU fuel to Russia. DOE spent $4 million to purchase LEU  fuel for the Romanian reactor, which is still only partially converted and  requires more LEU fuel before conversion is complete. DOE officials said  that current DOE policy allows purchasing LEU fuel for research reactors  that use Russian-origin HEU fuel in exchange for returning the HEU to  Russia. However, DOE does not have a similar policy for research reactors  that use U.S.-origin HEU fuel. DOE officials said they are considering  revising this policy to allow purchasing LEU fuel for U.S.-supplied research  reactors.

		Only One of Seven Russian- Supplied Reactors That Can Use Low Enriched Uranium Is Scheduled to Convert

According to Argonne officials, 7 Russian-supplied research reactors, all  located outside Russia, could convert using LEU fuels that are currently  available or are expected to become available within the next year.  However, only 1 of the 7 reactors, located in Ukraine, is scheduled to  convert. (See table 3 for a list of the 7 reactors.)
The Ukrainian reactor operators told us that they expect to begin  conversion to LEU at the end of 2004 at the earliest and that they are  currently analyzing the safety of converting to LEU with the assistance of  DOE’s reactor conversion program. Unlike many of the U.S.-supplied  research reactors that are not planning to convert because they have an  adequate supply of HEU, the Ukrainian reactor is running out of HEU fuel  and will have to place an order for new fuel by the end of 2004. The reactor  operators told us they support conversion to LEU fuel because the negative  impact on the reactor’s performance will be tolerable, the operating costs  will be about the same after conversion to LEU, and converting to LEU  would eliminate the threat that HEU could be stolen from the facility. The  reactor operators are scheduled to complete the safety analysis in  November 2004 and then submit an application to obtain approval for  conversion from the Ukrainian nuclear regulatory authority. However,  Argonne officials said the schedule for converting the Ukrainian reactor is  ambitious and conversion of the reactor could be delayed. According to  Argonne officials, if the Ukrainian reactor does not get regulatory approval  for conversion to LEU before it runs out of fuel, it may decide to place an  order with the Russian supplier for more HEU fuel instead.
According to DOE officials, 5 other Russian-supplied reactors that can use  LEU fuel are likely to convert. Conversion of the reactors in Bulgaria and  Libya depends on the commercialization of the Russian-origin LEU fuel,  which DOE expects to take place in 2004. DOE has also engaged in  discussions on conversion with the operators of the research reactor in  Vietnam. According to Argonne officials, conversion of the research  reactor in Hungary requires at least several more years of analysis. In  particular, the reactor must test an LEU fuel sample before the Hungarian  government approves conversion, and this process will take several years.  Argonne officials said the research reactor in Germany has a sufficient  supply of HEU fuel and therefore is not planning to convert to LEU.

	Technical Setbacks in Developing New Fuels Limit Progress in Converting the Largest Remaining Research Reactors

Technical setbacks in developing new LEU fuels have postponed the  conversion of 31 research reactors worldwide that cannot use currently  available LEU fuels until 2010 at the earliest. Argonne is pursuing the  development of LEU dispersion fuel and LEU monolithic fuel to convert  these reactors. Argonne officials said the failures during testing of  dispersion fuel are the worst they have ever experienced during fuel  development. As a result, Argonne has delayed completion of dispersion  fuel until 2010 and may recommend that DOE cancel further development  altogether if solutions cannot be found. This would leave the reactor  conversion program with only one alternative LEU fuel—monolithic fuel.  According to Argonne officials, monolithic fuel has performed well in the  one test conducted so far. However, many more tests are required. Because  of lessons learned from dispersion fuel failures, Argonne recently delayed  the projected completion date of monolithic fuel from 2008 to 2010 in  anticipation of the need for additional tests. Argonne officials said they  have compressed the development schedule of both dispersion and  monolithic fuel as much as possible and any further technical problems will  result in additional delays. Moreover, Argonne is focusing all LEU fuel  development efforts on dispersion and monolithic fuel, and if both fuels  fail, no LEU fuel will be available to convert the remaining reactors in the  reactor conversion program.

		DOE May Cancel Development of One Low Enriched Uranium Fuel That Has Had Significant Problems

The 31 research reactors worldwide that cannot convert to currently  available LEU fuels include some of the largest reactors in terms of amount  of HEU used per year. Argonne officials estimate the reactors use a total of  about 728 kilograms of HEU per year. Many of the 31 reactors are used to  conduct advanced scientific research that could not be done if they were to  convert to currently available LEU fuels. Representatives of 8 of the  research reactors told us they need HEU fuel to operate and conduct  research until LEU fuel with the right performance characteristics is  developed. (See table 4 for a list of the 31 reactors.)
DOE’s reactor conversion program has run into problems in developing  new LEU fuels intended to replace HEU in these research reactors. The  most serious problems have occurred in tests of dispersion fuel, the  development of which began in 1996. According to Argonne officials,  dispersion fuel would be usable in the Russian-supplied research reactors  and 1 U.S. reactor. Most recently, tests of the dispersion fuel have  revealed weaknesses that would make the fuel unsuitable for use in  research reactors. In particular, when samples of dispersion fuel were  tested in research reactors, the fuel failed unexpectedly under reactor  operating conditions the fuel was designed to withstand.
A number of factors illustrate the seriousness of the problems with the  dispersion fuel. First, according to Argonne officials, the same problems  have been encountered in separate tests and under different operating  conditions in reactors in the United States, Belgium, France, and Russia.  Second, the problems were unexpected and worse than encountered in  previous LEU fuel development efforts. Finally, if the failures were serious  enough, the fuel could leak radioactive material into the reactor coolant  and cause facility contamination. If this occurred, the dispersion fuel would  not be approved for use in research reactors.
Argonne officials said that, as a result of these test failures, they have  delayed projected completion of dispersion fuel from 2006 until 2010 to  allow time for additional development and testing. Argonne officials plan to  pursue options to modify dispersion fuel to make it resistant to failures.  However, they said they would also consider recommending that DOE  cancel further development of dispersion fuel if it is determined the fuel  cannot be sufficiently improved. In addition, because of the problems  encountered in the development of dispersion fuel, Argonne has shifted its  primary focus to the development of monolithic fuel.

		More Time Is Needed to Develop an Alternative Low Enriched Uranium Fuel

Initial testing of monolithic fuel has produced positive results under the  same operating conditions under which dispersion fuel failed. According to  Argonne officials, if they are successful in developing monolithic fuel, it  will offer better reactor performance than dispersion fuel and could be  used to convert the remaining research reactors in the reactor conversion  program to LEU.
Nevertheless, the successful development of this fuel is still uncertain, and  Argonne has not yet demonstrated that all remaining research reactors still  using HEU could convert to it. Argonne officials said they began developing  monolithic fuel relatively recently, in 2000, and to date have conducted only  one test. Additional testing could reveal problems that have not yet  surfaced. Furthermore, this fuel requires development of a new  manufacturing method because the methods used to manufacture other  research reactor fuels are not suitable for monolithic fuel. Argonne is  conducting research on different manufacturing options but has not yet  demonstrated that monolithic fuel can be manufactured on a large scale.  Three reactor operators hoping to convert to this fuel told us it is  impossible to predict whether the new LEU fuel will be successfully  developed and that creating a reliable LEU fuel could take many years  more than expected.
Development of monolithic fuel may be delayed if Argonne encounters any  problems in the fuel development process. Argonne officials said they have  already delayed projected completion from 2008 to 2010 to allow time for  additional testing. The schedule for developing monolithic fuel does not  factor in any technical problems that may occur during testing but rather  assumes that every phase of development will be successful. Argonne  officials said they have already compressed the schedule as much as  possible and that it would be difficult to significantly accelerate fuel  development any further because each set of tests requires a fixed amount  of time. The officials also stated that fuel development would have been  delayed even further had Congress not increased funding for the reactor  conversion program from $6.1 million in fiscal year 2003 to $8.5 million in  fiscal year 2004, which enabled Argonne to pursue a more aggressive fuel  development schedule. Assuming no further delays in fuel development,  Argonne officials said the first research reactors could begin ordering new  LEU for conversion within 6 months of completing the development of  either dispersion fuel or monolithic fuel in 2010.

		Support for Conversion to Low Enriched Uranium Fuel Varies among Research Reactor Operators

In our visits to foreign and domestic research reactors that cannot convert  to currently available LEU fuels, we found that reactor operators’ response  to the prospect of conversion to LEU fuels varies widely. For example, the  operator of the BR-2 reactor in Belgium said it had agreed to convert to  LEU when feasible as a condition for continuing to receive U.S.-origin HEU  fuel. In contrast, a new German reactor at the Technical University Munich  designed to use HEU (the FRM-II reactor) may still not be able to convert  to LEU even if Argonne is successful in developing monolithic fuel. The  reactor operator has agreed to convert to a lower enrichment of HEU that  is less usable in nuclear weapons. However, during our visit to the reactor,  the operator said it had no plans to convert the reactor to LEU fuel because  conversion would require expensive reconstruction.
Argonne has contracted with Russia to work jointly on development of new  LEU fuels, but DOE has not negotiated a formal agreement with the  Russian government to convert research reactors in Russia to LEU. DOE’s  reactor conversion program includes 14 research reactors operating in  Russia that, combined, use 225 kilograms of HEU fuel per year. In 2002, the  Secretary of Energy and Russia’s Minister of Atomic Energy issued a joint  statement identifying acceleration of LEU fuel development for both  Russian-supplied and U.S.-supplied research reactors as an area where  joint cooperation could lead to reduction in the use of HEU. However, the  Russian officials responsible for developing LEU fuels told us they are  focusing on converting Russian-supplied reactors in other countries first.  The officials also do not consider the conversion of research reactors in  Russia to LEU a priority because security has been improved at the  reactors and the reactors need HEU fuel to conduct advanced research.
Furthermore, Russian officials told us that under Russian law, operators of  HEU reactors in Russia are not required to convert to LEU. In fact, since  1986, Russia has been building a new research reactor that is designed to  use HEU fuel rather than LEU.
Three U.S. research reactors (at the Massachusetts Institute of Technology,  the University of Missouri, and the National Institute of Standards and  Technology) where conversion is not currently feasible fall under NRC  regulations that would require conversion to LEU if the reactor conversion  program is successful in developing new LEU fuels. Furthermore, the  Secretary of Energy committed to the conversion of all U.S. research  reactors by 2013 in a speech on May 26, 2004. However, without federal  funding to support the conversion, the reactors may continue to use HEU.  For example, the operator of the Massachusetts Institute of Technology  reactor said that conversion to LEU could be delayed even after a new LEU  fuel is developed if DOE does not provide funding in a timely manner.

	Using Low Enriched Uranium for Medical Isotope Production Is Feasible, but Concerns over Cost Could Limit Its Use

The reactor conversion program has demonstrated the potential for using  LEU to produce medical isotopes on a small scale, but large-scale  producers are concerned that the cost of conversion could be prohibitive.  With assistance from the reactor conversion program, one reactor in  Argentina used for the production of medical isotopes converted from HEU  to LEU in 2003. However, Argonne officials said the conversion was  feasible only because the reactor produces medical isotopes on a small  scale, using a relatively small amount of material in the production process.  (Prior to converting to LEU, the Argentine reactor used less than a  kilogram of HEU per year. In contrast, four large medical isotope producers  targeted by the reactor conversion program, located in Belgium, Canada,  the Netherlands, and South Africa, each use as much as 25 kilograms of  HEU per year.)  Argonne is still working to overcome problems with using  LEU that limit the ability of the Argentine reactor to increase its production  capacity.
Argonne officials said they are 2 to 3 years away from completing work that  would allow the large medical isotope producers to convert from HEU to  LEU. Argonne officials said they have developed LEU materials that can be  used by all medical isotope producers and only the adaptation of the  production processes from using HEU to LEU remains. They said that  adapting the medical isotope producers’ processes, each of which is unique  in some aspect, is technically feasible and is just a matter of time. One  reason why the production processes must be modified is that almost five  times more LEU than HEU is required to produce the same amount of  medical isotopes. The increased amount of nuclear material creates  obstacles to conversion. For example, using LEU would produce more  waste, which in turn could increase the burden of treating and storing the  waste.  In addition, the facilities, chemical processes, and waste  management systems for producing medical isotopes are customized to use  HEU and would require modifications to accommodate LEU.
In discussions with the two large medical isotope producers in Belgium and  Canada, both cited a number of factors that would make conversion to LEU  costly and difficult, including the fivefold increase in the amount of LEU  that would be required to achieve the same level of output when using  HEU. As part of its technical analysis, the Canadian producer is currently  conducting an assessment of converting to LEU to determine whether  conversion would be economically feasible. The Canadian producer  currently uses U.S.-origin HEU and, under U.S. law, must agree to convert  to LEU when a suitable LEU alternative is developed. (The other three  large medical isotope producers currently receive their HEU from  countries other than the United States and are therefore not subject to U.S.  requirements to convert to LEU.)  U.S. law also allows for an exception to  the requirement to convert to LEU if conversion would result in a large  percentage increase in operating costs. Officials at DOE and NRC, which  implements the law governing U.S. HEU exports, acknowledge that  medical isotope producers operate on small profit margins, and as a result,  the cost of converting to LEU may be prohibitive. However, Argonne  officials said that conversion to LEU could result in a more economic  process. DOE officials said they would not accept a statement by the  Canadian producer that conversion of medical isotope production to LEU  is not economically feasible without documentation to support that  conclusion.

	DOE and NRC Are Addressing Security at Foreign and Domestic Research Reactors

Research reactor operators at most reactors we visited said that security  had been improved because of DOE or NRC efforts. However, DOE and  NRC have recognized the need to further improve security at research  reactors throughout the world, including in the United States, and are  engaged in separate efforts to assess research reactor security and its  effectiveness.
At the foreign research reactors we visited, we observed security  improvements to storage areas for HEU fuel, systems for controlling  personnel access to the reactors, and alarm systems, including motion  detectors and camera monitoring. DOE provided assistance to some of the  foreign reactors to make the security improvements; other reactor  operators had made the improvements with their own funding based on  DOE recommendations. At U.S. research reactors, we saw physical  security improvements around the reactor buildings, such as new fences  and concrete barriers. Several operators of university research reactors  told us they were using funding from DOE’s university reactor support  program to purchase new security equipment.
We also observed areas where further improvement could be made. For  example, we visited one foreign research reactor’s facility for storing spent  HEU fuel where DOE had provided only minimal assistance to improve  security. According to DOE officials, DOE has generally not provided  assistance to improve the security of spent HEU fuel because it is  radioactive and too dangerous for potential terrorists to handle. DOE has  placed a higher priority on protecting fresh fuel—fuel that has not been  irradiated in a reactor—because it is easier to handle. However, operators  of the fuel storage facility said that the spent fuel had been in storage for a  long time and had lost enough radioactivity to be handled and potentially  stolen.
During a visit to another foreign research reactor, we observed a new alarm  system monitoring the entrance to the reactor building, a fresh fuel vault,  and motion detectors that had been installed with DOE assistance. DOE is  in the process of adding further enhancements to the security of the  facility. However, we also observed that the fence surrounding the facility  was in poor condition, security guards at the front gate were unarmed, and  there were no guards at the reactor building, which we entered without  escort. At another research reactor, DOE identified security weaknesses  and offered assistance to make security improvements. However,  according to the U.S. embassy in the country where the reactor is located,  the improvements had not been made as of March 2004 because the reactor  operator did not act on DOE’s offer of assistance. We discussed examples  that raised questions about security of foreign research reactors with DOE  officials during meetings on March 12 and 22, 2004, and they agreed that  DOE needs to do more to address potential security concerns.
Recognizing that the security at some research reactors may need to be  improved, DOE established a task force in 2004 to identify the highest risk  reactors and to develop options for improving security at reactors believed  to be of greatest concern. The task force is currently gathering information  on all research reactors worldwide, including reactors that are shut down,  and prioritizing them based on a number of factors, including how much  HEU is stored on site, the vulnerability of the reactors to theft of HEU or  sabotage, plans for conversion to LEU and removal of HEU fuel, and the  potential terrorist threat to countries where the reactors are located. The  scope of the initiative comprises 802 research reactors and associated  facilities, including 128 facilities possessing 20 kilograms or more of HEU  on site. DOE officials said the task force addresses the need to combine  and coordinate information from different sources within DOE, which did  not have a comprehensive database prior to the task force to document  visits and security observations made by various DOE program officials to  foreign research reactors. According to DOE officials, the task force has  submitted a report to the Secretary of Energy with recommendations for  possible implementation by DOE, such as expediting conversion to LEU  and providing additional assistance to foreign research reactors to improve  security. According to task force members, security assistance to foreign  reactors could be provided by DOE, the International Atomic Energy  Agency, or countries other than the United States.
NRC is also engaged in efforts to assess and improve the security at the  U.S. research reactors it regulates. NRC took actions after the attacks of  September 11, 2001, to improve security at U.S. research reactors—for  example, by requiring some reactor operators to consider installing  additional physical barriers and strengthening screening requirements for  entrance to facilities. In addition, NRC is conducting assessments of the  security at the research reactors it regulates and may increase security  requirements based on the results of the assessments. According to NRC  officials, the agency’s security evaluations of U.S. research reactors will be  completed in December 2004. Based on the results of the evaluations, NRC  will decide to strengthen current regulations, leave regulations as they are,  or address security concerns at each reactor on a case-by-case approach.

	Conclusions

While several research reactors are scheduled to convert to LEU fuel in the  next few years, progress in converting many remaining reactors has stalled.  In part, converting these reactors is a matter of completing development of  new LEU fuels, which has been delayed by unforeseen technical problems.  However, if DOE’s reactor conversion program is to achieve its objective to  reduce and eventually eliminate the use of HEU in civilian research  reactors, DOE may need to re-evaluate its policies with regard to the  program. Many of the research reactors that could use currently available  LEU fuels have not converted because they lack incentives, funding, or  both. Until recently, the policy of DOE’s reactor conversion program has  been to provide technical assistance to support conversion of research  reactors to LEU but not to pay for conversion or, in particular, purchase  new LEU fuel. In the case of six U.S. university reactors, DOE has not made  purchasing LEU fuel for conversion (and completing the conversion  process at another reactor by removing HEU fuel and shipping it to a DOE  facility for disposal) a high priority. While many of the U.S. reactors that  could convert to LEU use only a small amount of HEU per year, converting  them would demonstrate DOE’s commitment to the nonproliferation  objective of the reactor conversion program.
DOE has generally expected the operators of foreign research reactors that  use U.S.-origin HEU fuel to purchase new LEU fuel with their own funds.  The policies DOE has relied on to influence operators to convert to LEU— requiring that reactor operators agree to convert as a condition of receiving  U.S. HEU exports or returning spent fuel to the United States—do not work  for reactors using so little HEU that they can operate for many years  without replacing their fuel. Without funding for conversion, it is possible  these reactors could continue using HEU for years. DOE may need to  consider offering additional incentives to foreign reactors, including  purchasing new LEU fuel, to influence them to convert to LEU.
Regardless of progress in converting domestic and foreign research  reactors to LEU in the near term, delays in completing the development of  new LEU fuels mean that other research reactors will continue to use HEU  until at least 2010. If the reactor conversion program experiences  additional problems in one or both of the two LEU fuels currently under  development, some research reactors could be left without a viable option  for conversion to LEU. Given the continuing use of HEU at these research  reactors, DOE and NRC efforts to evaluate and improve reactor security  are essential components of the overall effort to reduce the risk of  proliferation of HEU at civilian research reactors.

	Recommendations for Executive Action

In order to further reduce the use of HEU in research reactors in the United  States and abroad, we recommend that the Secretary of Energy and the  Administrator of the National Nuclear Security Administration take the  following three actions:  consider placing a higher priority on converting the six remaining  university research reactors in the United States that can use currently  available LEU fuel;  once a reactor has been converted, place a high priority on removing the  HEU fuel and transporting it to the appropriate DOE facility; and  evaluate the costs and benefits of providing additional incentives to  foreign research reactors that use U.S.-origin HEU fuel to convert to  LEU, particularly to reactor operators that are willing to convert but do  not have sufficient funding to do so.

	Agency Comments and Our Evaluation

We provided draft copies of this report to the Departments of Energy and  State and to NRC for their review and comment. Comments from the  Departments of Energy and State are presented as appendixes III and IV,  respectively. NRC’s written comments were not for publication. DOE,  State, and NRC generally agreed with the recommendations in our report  and provided detailed comments, which we incorporated into the report as  appropriate.
In its comments, DOE noted that the United States has 11 more research  reactors to convert to the use of LEU fuels, with conversion currently  feasible for 6 of the reactors. However, DOE’s February 2004 project  execution plan for its reactor conversion program identifies 14 U.S.  research reactors still using HEU fuel that are included in DOE’s reactor  conversion program, with conversion currently feasible for 8 of the  reactors. We used the number of reactors from DOE’s project execution  plan in our report.
In its comments, State questioned DOE’s cost estimate for converting U.S.  research reactors where conversion to LEU fuel is currently feasible. State  noted that DOE’s cost estimate of $5 million to $10 million per reactor  where conversion to LEU fuel is currently feasible seems much too high,  especially in comparison with DOE’s expenditures of about $0.4 million to  $1.6 million per reactor to convert 11 U.S. university reactors to LEU fuel  between 1984 and 2000. State wrote that the DOE office that administers  the program for supporting U.S. university research reactors has been  reluctant to fund the conversion of more research reactors and has a  tendency to overstate the potential costs to deflect pressure to spend  money on conversions. We asked DOE officials what support they had for  the cost estimate. In response, a DOE official said that DOE does not have  documentation to support its cost estimate.
In another comment, State suggested we include recognition of the  growing number of new and planned research reactors around the world  that have been designed to use LEU fuel. State wrote that modern world- class reactors do not need HEU fuel to conduct high-quality research. DOE  officials also provided information on the use of LEU fuel in new research  reactors constructed since the inception of its reactor conversion program  in 1978. Although our report does not focus on new research reactors  designed to use LEU fuel, we agree that this is a positive development in  keeping with the objective of DOE’s reactor conversion program and we  added a footnote recognizing these new reactors.

	Scope and Methodology

To review the progress of the reactor conversion program, we analyzed  program documentation, including DOE’s February 2004 RERTR Program  Project Execution Plan. We also interviewed key DOE, Argonne, NRC, and  State Department officials; conducted site visits to foreign and U.S.  research reactors and interviewed reactor operators by telephone; and  attended an annual international conference organized by DOE’s reactor  conversion program.
For site visits and telephone interviews, we selected foreign and domestic  research reactors from three categories: reactors that had converted to  LEU, reactors that could convert using currently available LEU fuels but  were still using HEU, and reactors that could not convert using currently  available LEU fuels. Within each of the three categories of reactors, we  selected a nonprobability sample of reactors based on a number of criteria  such as reactor types, including U.S.-supplied reactors, Russian-supplied  reactors, and reactors that use HEU in the production of medical  isotopes. We visited 5 research reactors in the United States, including 3  that had converted to LEU and 2 that cannot convert to currently available  LEU fuels and are still using HEU. We conducted phone interviews with  reactor operators from 1 other U.S. reactor that cannot use currently  available LEU fuels and all 6 of the U.S. university research reactors that  can convert to LEU but are still using HEU. We also visited 10 foreign  research reactors in Belgium, Germany, the Netherlands, Poland, Portugal,  Romania, Russia, and Ukraine. These included 2 converted reactors, 4  reactors that can use LEU fuel but have not yet converted, and 4 reactors  that still require HEU. (See table 5.)
In our site visits and telephone interviews, we asked a standard set of  questions (depending on the conversion status of the reactor) on technical  aspects of converting to LEU, cost of conversion, impact of conversion on  reactor performance, and assistance provided by DOE’s reactor conversion  program.
To review the progress in developing new LEU fuels for use in research  reactors, we conducted in-depth interviews with Argonne officials  responsible for managing LEU fuel development; operators of reactors that  plan to convert to new LEU fuels when they are developed; and fuel  development experts at the Bochvar Institute in Russia, which is  collaborating with Argonne. At the annual international conference  organized by DOE’s reactor conversion program, we participated in  sessions on LEU fuel development, and we reviewed technical papers on  the progress of fuel development. For technical expertise, we relied on  GAO’s Chief Technologist, who participated in meetings with Argonne  officials and reviewed the information that Argonne provided. We used the  interviews and annual conference to also review progress in the  development of LEU for use in the production of medical isotopes. In  addition, we interviewed two of the four large medical isotope producers  (in Belgium and Canada) that are currently using HEU to produce medical  isotopes and that would be candidates for conversion to LEU once Argonne  completes development.
To gather information on DOE and NRC efforts to improve research reactor  security, we interviewed officials at those agencies and discussed security  improvements with reactor operators we interviewed. We also observed  security improvements at research reactors we visited. However, we did  not evaluate the effectiveness of the security at research reactors or DOE  and NRC efforts to improve security.
We obtained data from DOE and Argonne on the conversion status of the  105 research reactors included in the reactor conversion program, the  amount of HEU used per year by the 105 reactors (including the amount  used prior to conversion for the 39 research reactors now using LEU), and  DOE expenditures for the reactor conversion program since its inception in  1978. All amounts are in constant 2003 dollars, unless otherwise noted. We  assessed the reliability of data we obtained through discussions with  Argonne officials. We also obtained responses from Argonne officials to a  series of data reliability questions covering issues such as quality control  procedures and the accuracy and completeness of the data. Based on our  assessment, we determined that the data we obtained from DOE and  Argonne was sufficiently reliable for our purposes.
We conducted our work from July 2003 to July 2004 in accordance with  generally accepted government auditing standards.
We are sending copies of this report to the Secretary of Energy; the  Administrator, National Nuclear Security Administration; the Secretary of  State; the Chairman, NRC; the Secretary of Homeland Security; the  Director, Office of Management and Budget; and interested congressional  committees. We will also make copies available to others upon request. In  addition, this report will be available at no charge on the GAO Web site at  http://www.gao.gov.
If you or your staff have any questions about this report, please call me at  (202) 512-3841. Key contributors to this report include Joseph Cook,  Jonathan McMurray, Kirstin B.L. Nelson, Peter Ruedel, F. James Shafer Jr.,  and Keith Rhodes, GAO’s Chief Technologist.

Reactor Conversion Program Expenditures and Projected Costs

DOE estimates that the reactor conversion program will cost  approximately $213 million through the program’s projected end in 2012.   Expenditures since the program’s inception in 1978 through fiscal year 2003  totaled approximately $139 million in constant 2003 dollars. (See fig. 3.)
Costs for the reactor conversion program are broken into four categories:  Fuel development includes all of the activities associated with testing  and analyzing new LEU fuels, such as the LEU dispersion and  monolithic fuels that are currently under development. This activity also  includes developing the methods for manufacturing new LEU fuels.  Most of the reactor conversion program costs over the life of the  program are in this category.
Reactor analysis includes studying the conversion of individual research  reactors, both domestic and foreign, once a suitable LEU has been  developed. For example, Argonne provides technical assistance to  research reactors to determine the impact of conversion on the reactors’  performance and safety. This category does not include the cost of  purchasing LEU fuel for research reactors. For example, the  responsibility for purchasing LEU fuel for U.S. university reactors  belongs to another program in DOE that is separate from the reactor  conversion program.
Development of LEU for medical isotope production includes activities  associated with testing and analyzing LEU materials to replace HEU in  the production of medical isotopes. This activity also includes  development of manufacturing and waste management processes for  using LEU instead of HEU and technical assistance to medical isotope  producers.
Assistance to Russia includes funding to support research and  development on new LEU fuels for Russian-supplied reactors. It also  includes analysis of the impact of conversion to LEU on Russian- supplied reactors. The assistance to Russia was previously funded  through a one-time grant of approximately $1.7 million, about two-thirds  of which has been spent, from the State Department’s Nonproliferation  and Disarmament Fund (NDF).
In addition to the $139 million spent by the reactor conversion program,  DOE’s university reactor support program spent approximately $10 million  between 1984 and 2000 to convert 11 university research reactors in the  United States, according to an official at the Idaho National Engineering  and Environmental Laboratory (INEEL). The cost of converting each  reactor varied from around $400,000 to $1.6 million and was primarily for  the cost of fabricating the fuel. The costs varied depending on the type of  fuel and where it was manufactured.
DOE’s projected costs for completing the reactor conversion program total  about $74.7 million. (See table 6.)  This amount includes $26.3 million for  reactor analysis, $25.8 million for fuel development, $4.8 million for the  development of LEU for medical isotope production, and $17.8 million for  assistance to Russia.
DOE’s cost estimates are based on the assumption that at least one of the  two LEU fuels that Argonne is developing will be successful and will be  used for the reactor conversion program. DOE also assumes that Russia  and other countries will continue to assist Argonne in conducting fuel tests  as necessary for fuel development. DOE’s estimates do not include the cost  of purchasing new LEU fuel to convert research reactors. These costs are  expected to be funded by other DOE programs or by the operators of  foreign research reactors.

39 Research Reactors That Converted to LEU Fuel under the Reactor Conversion Program

Comments from the Department of Energy

Comments from the Department of State

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Summary:
Why GAO Did This Study

Nuclear research reactors worldwide use highly enriched uranium (HEU) as fuel and for the production of medical isotopes. Because HEU can also be used in nuclear weapons, the Department of Energy's (DOE) Reduced Enrichment for Research and Test Reactors program is developing low enriched uranium (LEU), which would be very difficult to use in weapons, to replace HEU. To date, 39 of the 105 research reactors in the United States and abroad targeted by DOE have converted to LEU fuel. GAO was asked to examine (1) the status of the remaining research reactors in converting to LEU fuel, (2) DOE's progress in developing new LEU fuels for reactors where conversion is not yet technically feasible, (3) DOE's progress in developing LEU for the production of medical isotopes, and (4) the status of DOE and Nuclear Regulatory Commission (NRC) efforts to improve security at research reactors.

What GAO Found

Currently, conversion to LEU fuel is technically feasible for 35 of the 66 research reactors in DOE's program that still use HEU fuel, but most do not have plans to convert. In the United States, 8 research reactors, including 6 university research reactors, have not converted because DOE has not provided the necessary funding. Of the 20 foreign research reactors that use U.S.-origin HEU fuel, 14 do not have plans to convert because they have a sufficient supply of HEU fuel and either do not want to incur the additional cost of conversion or do not have the necessary funding. Finally, only 1 of 7 Russian-supplied research reactors that could use LEU fuel is scheduled to convert. Conversion to LEU fuel is not technically feasible for 31 research reactors worldwide that still use HEU fuel. DOE has experienced technical setbacks in fuel development that have postponed the conversion of the 31 reactors until 2010 at the earliest. One fuel failed unexpectedly in testing, and DOE may cancel further development, depending on the results of additional tests. Initial testing of another LEU fuel produced positive results, but additional testing is required and the fuel will not be developed until 2010 at the earliest. Separately from the development of LEU fuel, DOE is developing LEU to replace HEU in the production of medical isotopes. DOE has not yet completed the work that would enable conversion of large-scale medical isotope production to LEU. One reactor has converted to LEU for smallscale production. However, large-scale producers are concerned that the cost of converting to LEU could be prohibitive. DOE and NRC have taken steps to improve security at foreign and U.S. research reactors. While operators at most research reactors we visited said that security had been upgraded through DOE or NRC efforts, we observed areas where further improvements could be made. Recognizing the possible need for further improvements, DOE and NRC are engaged in separate efforts to assess and improve security.