United States Government Accountability Office

GAO Report to the Subcommittee on Energy 

and Water Development, Committee on 

Appropriations, House of 

Representatives 

DEPARTMENT OF 

ENERGY 

Consistent 

Application of 

Requirements Needed 

to Improve Project 

Management 

May 2007 

 

GAO-07-518 
What GAO Found

United States Government Accountability Office

Why GAO Did This Study

Highlights

Accountability Integrity Reliability

May 2007

DEPARTMENT OF ENERGY 

Consistent Application of Requirements 

Highlights of GAO-07-518, a report to the Needed to Improve Project Management 

Subcommittee on Energy and Water 

Development, Committee on 

Appropriations, House of Representatives

Since 1990, Department of Energy 

(DOE) contract management 

(which includes project 

management) has been designated

as a high-risk area for fraud, waste,

abuse, and mismanagement. For

years, GAO has reported on DOE’s 

inadequate management and 

oversight of its contracts and 

projects. GAO has made dozens of

recommendations on steps that 

DOE could take to improve project 

management. Furthermore, in 1999

The National Academies’ National

Research Council developed a 

series of recommendations to

address weaknesses in DOE’s 

project management. This GAO 

report discusses (1) DOE’s main 

efforts since 1999 to address 

project management weaknesses, 

(2) the extent to which DOE’s 

project performance has improved, 

and (3) the extent to which DOE’s

project management guidelines 

have been consistently followed. 

What GAO Recommends

GAO recommends that DOE 

enhance accountability by ensuring 

that project management

requirements are consistently

followed by all of the department’s 

component organizations and that 

any exceptions to following the 

requirements are allowed only after 

senior management’s review and 

approval. In commenting on a draft 

of the report, DOE agreed with the 

recommendation. 

Since 1999, DOE has improved its approach to project management by 

addressing weaknesses in three key areas, as recommended by the National 

Research Council—strengthening project management policies and 

guidance, developing consistent and objective performance information on 

ongoing projects, and improving the quality of federal oversight of 

contractors and projects. DOE revised its policies and guidance to, among 

other things, require senior management approval at critical decision points. 

To develop consistent, objective performance information for ongoing 

projects, DOE required its contractors to implement an “earned value” 

management system, commonly used in private industry. DOE also 

developed a project tracking and reporting system to routinely make the 

earned value performance information available to managers. To help ensure

the consistency and reliability of performance data, DOE is reviewing and 

certifying the contractors’ earned value management systems. To improve 

the quality of federal oversight, DOE developed a training and certification 

program for federal project directors and required independent reviews of 

projects at critical decision points. 

Nevertheless, performance on DOE’s projects has not substantially 

improved. DOE set a performance goal of having 90 percent of its ongoing 

projects being managed within a 10 percent variance of cost and schedule 

baseline targets. Since October 2002, when DOE began reporting monthly 

project performance data, DOE has achieved its 90 percent performance

goal only about one third of the time. The percentage of projects meeting the 

performance goal has been relatively steady, seldom falling below 80 percent 

or exceeding 90 percent. DOE officials said that, although performance goals 

are not consistently being met, improvements in project planning, 

independent project reviews at critical decision points, and stronger federal 

oversight should result in improved project performance in the future. 

DOE has not ensured that its project management requirements are 

consistently followed. For example, on a project started in June 2004 to 

demonstrate an alternative waste treatment technology at DOE’s Hanford 

site, DOE officials decided to accelerate the project’s schedule. As a result,

the project was initiated without using key project management tools, such 

as an independent review of the cost and schedule baseline. After the project 

experienced significant schedule and technical problems and the estimated 

cost more than tripled to about $230 million, DOE began requiring that the 

project be managed consistent with its project management requirements. 

Furthermore, on four additional projects, estimated to cost over $100 million 

each, cost and schedule information was not being reported into DOE’s 

project tracking system, resulting in less senior management oversight. 

www.gao.gov/cgi-bin/getrpt?GAO-07-518.

To view the full product, including the scope 

and methodology, click on the link above. 

For more information, contact Gene Aloise, 

202-512-3841, aloisee@gao.gov.
Contents 

Letter 1

Results in Brief 4

Background 7

DOE Has Improved Its Approach to Managing and Overseeing

Projects 8

DOE Has Not Demonstrated Improved Project Performance 15 

DOE Has Not Fully Implemented Its Project Management 

Improvement Efforts or Ensured That Project Management 

Requirements Are Consistently Followed 19 

Conclusions 22

Recommendation for Executive Action 23 

Agency Comments and Our Evaluation 23 

Appendix I Scope and Methodology 25 

Appendix II Comments from the Department of Energy 27 

Appendix III GAO Contact and Staff Acknowledgments 29 

Related GAO Products 30 

Figures 

Figure 1: Percentage of Ongoing Line Item Construction Projects 

within 10 Percent of Cost and Schedule Baseline, October 

2002 through September 2006 16 

Figure 2: Percentage of Ongoing Office of Environmental 

Management Operating Projects within 10 Percent of Cost 

and Schedule Baseline, February 2004 through September 

2006 18

Page i GAO-07-518 DOE Project Management
Abbreviations 

DOE Department of Energy 

NNSA National Nuclear Security Administration 

This is a work of the U.S. government and is not subject to copyright protection in the 

United States. It may be reproduced and distributed in its entirety without further 

permission from GAO. However, because this work may contain copyrighted images or 

other material, permission from the copyright holder may be necessary if you wish to 

reproduce this material separately. 

Page ii GAO-07-518 DOE Project Management
United States Government Accountability Office

Washington, DC 20548 

May 11, 2007

The Honorable Peter J. Visclosky 

Chairman 

The Honorable David L. Hobson 

Ranking Member 

Subcommittee on Energy and Water Development 

Committee on Appropriations 

House of Representatives 

The Honorable Peter J. Visclosky 

Chairman 

The Honorable David L. Hobson 

Ranking Member 

Subcommittee on Energy and Water Development 

Committee on Appropriations 

House of Representatives 

The Department of Energy (DOE), the largest civilian contracting agency 

in the federal government, spends over 90 percent of its annual budget on

contracts to operate its laboratories, production facilities, and 

environmental restoration sites. In fiscal year 2006, DOE spent about $23 

billion on contracts to maintain the nation’s nuclear weapons stockpile, 

clean up radioactive and hazardous wastes, and conduct scientific 

research activities. DOE’s contractors generally carry out these missions 

by managing the department’s projects, and DOE program managers and 

federal project directors oversee the contractors’ efforts. As of September 

2006, DOE was managing 206 ongoing projects, costing $5 million or more, 

for a total estimated cost of $205.6 billion. These projects can be funded 

separately in the department’s annual budget as a construction line item or 

funded from annual operating funds, such as environmental cleanup 

projects. The cost and complexity of these projects can vary greatly, such

as a $12-million project to demolish a surplus building at the Lawrence 

Livermore National Laboratory in California or a multi-billion dollar 

project at the Hanford site in Washington state to design and construct 

one-of-a-kind facilities to treat high-level radioactive and hazardous 

wastes. 

The Department of Energy (DOE), the largest civilian contracting agency 

in the federal government, spends over 90 percent of its annual budget on

contracts to operate its laboratories, production facilities, and 

environmental restoration sites. In fiscal year 2006, DOE spent about $23 

billion on contracts to maintain the nation’s nuclear weapons stockpile, 

clean up radioactive and hazardous wastes, and conduct scientific 

research activities. DOE’s contractors generally carry out these missions 

by managing the department’s projects, and DOE program managers and 

federal project directors oversee the contractors’ efforts. As of September 

2006, DOE was managing 206 ongoing projects, costing $5 million or more, 

for a total estimated cost of $205.6 billion. These projects can be funded 

separately in the department’s annual budget as a construction line item or 

funded from annual operating funds, such as environmental cleanup 

projects. The cost and complexity of these projects can vary greatly, such

as a $12-million project to demolish a surplus building at the Lawrence 

Livermore National Laboratory in California or a multi-billion dollar 

project at the Hanford site in Washington state to design and construct 

one-of-a-kind facilities to treat high-level radioactive and hazardous 

wastes. 

For years, GAO has reported on DOE’s inadequate management and 

oversight of its contracts and projects and on its failure to hold 

contractors accountable for results. The poor performance of DOE’s 

contractors has led to schedule delays and cost increases for many of the 

department’s major projects. Such problems led us to designate DOE’s 

contract management—defined broadly to include both contract 

administration and project management—as a high-risk area for fraud, 

waste, abuse, and mismanagement in 1990. Since that time, we have issued 

numerous reports and made dozens of recommendations to DOE 

identifying specific steps that would improve project management across 

all parts of the department’s organization. For example, in June 2004, we 

For years, GAO has reported on DOE’s inadequate management and 

oversight of its contracts and projects and on its failure to hold 

contractors accountable for results. The poor performance of DOE’s 

contractors has led to schedule delays and cost increases for many of the 

department’s major projects. Such problems led us to designate DOE’s 

contract management—defined broadly to include both contract 

administration and project management—as a high-risk area for fraud, 

waste, abuse, and mismanagement in 1990. Since that time, we have issued 

numerous reports and made dozens of recommendations to DOE 

identifying specific steps that would improve project management across 

all parts of the department’s organization. For example, in June 2004, we 

Page 1 GAO-07-518 DOE Project Management
found that DOE’s failure to implement project management guidelines at 

the initiation of a major cleanup project at its Hanford site led to about a 

one-third increase in the project cost and added about 16 months to the 

estimated construction schedule.1

 We recommended, among other things, 

that DOE follow project management guidelines more closely. In addition, 

in March 2005, we recommended that the department take steps to 

strengthen contract management throughout its organization to more 

effectively control cost increases and schedule delays that were occurring

on many of the department’s major projects.2

 Several years later, we found 

that organizational conflicts between the National Nuclear Security 

Administration (NNSA) and DOE were inhibiting the effective 

management of the nuclear weapons complex and recommended, among 

other things, that NNSA take actions to strengthen management of its 

projects.3

 In April 2006, we testified before this subcommittee on the 

technical and management problems with the Hanford Waste Treatment 

Plant, a project to construct facilities to treat and prepare for disposal of 

55 million gallons of high-level radioactive waste.4

 The estimated costs of 

this project had increased from about $4.3 billion to over $12 billion, with 

an 8-year delay in completing the facilities. Many of the problems with the 

project resulted from poor contractor performance and poor DOE 

oversight of the contractor’s activities. Ultimately, in January of this year, 

we concluded that despite DOE’s efforts to address contract and project 

management weaknesses, performance problems continued to occur on 

DOE’s major projects, and DOE contract management remained at highrisk for fraud, waste, abuse, and mismanagement.5

In addition to GAO, others have reported problems with DOE’s 

management and oversight of its projects. Specifically, the conference 

 1

GAO, Nuclear Waste: Absence of Key Management Reforms on Hanford’s Cleanup

Project Adds to Challenges of Achieving Cost and Schedule Goals, GAO-04-611 

(Washington, D.C.: June 9, 2004). 

2

GAO, Department of Energy: Further Actions Are Needed to Strengthen Contract 

Management for Major Projects, GAO-05-123 (Washington, D.C.: Mar. 18, 2005). 

3

GAO, National Nuclear Security Administration: Additional Actions Needed to Improve

Management of the Nation’s Nuclear Programs, GAO-07-36 (Washington, D.C.: Jan. 19, 

2007). 

4

GAO, Hanford Waste Treatment Plant: Contractor and DOE Management Problems Have

Led to Higher Costs, Construction Delays, and Safety Concerns, GAO-06-602T 

(Washington, D.C.: Apr. 6, 2006). 

5

GAO, High-Risk Series: An Update, GAO-07-310 (Washington, D.C.: January 2007). 

Page 2 GAO-07-518 DOE Project Management
report accompanying DOE’s fiscal year 1998 Energy and Water 

Development Appropriations Act directed the department to obtain an 

independent review of its project management capabilities. The National 

Academies’ National Research Council issued its first report from this 

review in 1999.6

 The National Research Council reported that DOE’s 

construction and environmental cleanup projects took much longer and 

cost about 50 percent more than comparable projects by other federal 

agencies or projects in the private sector. The council concluded that 

DOE’s project management practices fell short of industry best practices 

in three key areas—the adequacy of its project management policies and 

guidance, consistent and objective performance information on the cost 

and schedule of projects, and the quality and adequacy of federal 

oversight. The National Research Council developed a series of 

recommendations to improve DOE’s framework for managing projects and 

noted that improved performance on projects would require an 

organizational and cultural change within the department. Both the 

National Research Council and DOE acknowledged that implementing 

these recommendations and changing the organization and culture within 

the department would be a major initiative and that it could take years to 

complete the implementation activities and to improve the cost and 

schedule performance of DOE’s projects. 

Therefore, you asked us to evaluate DOE’s efforts to improve management 

of its projects since the 1999 National Research Council report and to 

identify other steps DOE could take to strengthen its project management 

practices. In response, we undertook two separate reviews. One report 

issued in March 2007 discusses cost and schedule performance on 12 of 

DOE’s major construction projects, and the factors contributing to any 

cost increases or schedule delays.7

 This is the second report that discusses 

(1) DOE’s main efforts since 1999 to address weaknesses in the 

management of its projects, (2) the extent to which DOE’s project 

performance has improved, and (3) the extent to which DOE has 

implemented its improvement efforts and consistently followed its project 

management guidelines.

 6

National Research Council, Improving Project Management in the Department of Energy

(Washington, D.C.: June 1999). 

7

GAO, Department of Energy: Major Construction Projects Need a Consistent Approach

for Assessing Technology Readiness to Help Avoid Cost Increases and Delays, 

GAO-07-336 (Washington, D.C.: Mar. 27, 2007). 

Page 3 GAO-07-518 DOE Project Management
To determine DOE’s main efforts since 1999 to address weaknesses in its 

project management, we reviewed and analyzed DOE’s policies and 

guidance on managing projects, and DOE efforts to improve its 

management processes. We also interviewed senior DOE headquarters 

officials to identify improvement efforts that the department had taken or 

had in process. We focused our review of actions taken by DOE’s program 

offices on the department’s three largest elements by percentage of the

annual budget—NNSA and the Offices of Environmental Management and 

Science. To determine the extent to which performance on DOE’s projects 

has improved since 1999, we reviewed and analyzed DOE’s monthly status

reports on projects and related supporting documentation. Since we have 

expressed concern about the reliability of the data in DOE’s project 

tracking and reporting system, we did not develop our conclusions or 

findings based on information generated from that system. However, we 

did determine that the data were sufficiently reliable to present trends in

DOE’s ability to meet its performance goals. To determine the extent to 

which DOE’s improvement efforts have been fully implemented and its 

project management guidelines consistently followed since 1999, we 

reviewed and analyzed prior GAO reports and reports from DOE’s Office

of Inspector General and The National Academies’ National Research 

Council. These reports discussed weaknesses in DOE’s project 

management, contractor performance, and federal oversight of individual

projects, as well as DOE’s efforts to improve management of contracts and 

associated performance measures. A more detailed description of our 

scope and methodology is presented in appendix I. On October 12, 2006,

we briefed your staff on our results to date, and this report documents 

information presented in that briefing. We conducted our work from June

2006 to April 2007 in accordance with generally accepted government 

auditing standards. 

DOE has improved its approach to project management by addressing 

weaknesses in three key areas, as recommended by the National Research

Council in 1999— strengthening project management policies and 

guidance, developing consistent and objective performance information 

on ongoing projects, and improving the quality of federal oversight of 

contractors and projects.

Results in Brief 

• To strengthen project management policies and guidance, DOE began 

revising its policies and guidance in 2000 to incorporate industry practices

and requirements and increase the focus on early planning. Specifically, to 

improve contract planning, DOE issued new guidance on factors to 

consider in selecting the appropriate contract type for a project, given the 

Page 4 GAO-07-518 DOE Project Management
work to be performed and the associated risks. DOE also revised its 

policies and guidance to require the use of an integrated project team for 

planning, to help ensure that the program office considers legal, 

contracting, and safety issues in the early phases of a project. In addition, 

the revised guidance required senior management approval at critical 

decision points during a project, such as when starting construction for a 

new facility. 

• To develop consistent, objective performance information on the progress

of its ongoing projects, DOE required its contractors to implement an 

“earned value” management system. Earned value management, 

commonly used in private industry, relates the actual cost and schedule 

for accomplishing work on a project to the planned cost and schedule, and 

provides an objective measure of performance. DOE also developed a 

project tracking and reporting system to routinely gather and make 

available to its managers the earned value performance information, and 

began summarizing and reporting performance data from this system in 

fiscal year 2003. To help ensure the consistency and reliability of the data

in its project tracking system, in 2005 DOE began reviewing and certifying

the earned value management systems used by its contractors. The 

purpose of this review was to determine whether the systems used by 

contractors to develop and report project cost and schedule information 

complied with the industry standards for an earned value management 

system, and could be relied upon to produce consistent and objective 

performance information. 

• To improve oversight of projects, DOE took two main actions—it 

developed a training and certification program for its federal project 

directors, and it required independent reviews of projects at key decision 

points. Specifically, in 2003, DOE established a project management career 

development program, which defined the training and experience 

necessary for federal project directors. As of May 2006, all DOE employees 

responsible for oversight of its projects had met the training and 

experience requirements to become certified federal project directors. In 

addition, to increase confidence in its ongoing projects, DOE required 

independent reviews from outside the responsible program office, at the 

initiation of a project to validate the mission need and before the project 

baseline is approved to validate the cost and schedule estimates. 

Despite these considerable efforts, overall performance on DOE’s projects 

has not substantially improved to this point. DOE set a performance goal 

of having 90 percent of its ongoing projects being managed within a 10

percent variance of cost and schedule baseline targets. However, since 

October 2002, when DOE began reporting monthly project performance 

Page 5 GAO-07-518 DOE Project Management
data, the department has achieved its performance goals for line item 

construction projects (generally funded separately in the government’s 

annual budget) only about one third of the time. Also, starting in February

2004, DOE began reporting performance information separately for 

cleanup activities funded by the Office of Environmental Management 

annual operating funds rather than as individual line item construction 

projects. Prior to that time, these “operating” projects were included with

the line item construction projects. Since February 2004, these “operating” 

projects met cost and schedule performance goals only about 21 percent 

of the time. DOE officials said that, although performance goals are not 

consistently being met, improvements in project planning, independent 

project reviews at critical decision points, and stronger federal oversight 

should result in improved project performance in the future.

DOE has not fully implemented its project management improvement 

efforts or ensured that project management requirements are consistently

followed. One of DOE’s improvement efforts has been to review and 

certify contractors’ earned value management systems used to develop

and report information on the cost and schedule performance of DOE’s 

projects. DOE has completed the review and certification of eight 

contractor earned value management systems used on 40 of 96 ongoing

DOE projects. DOE has established annual targets for the number of 

contractor systems to be reviewed, but it could be several years before 

DOE has certified substantially all of the contractors’ earned value 

management systems. Of greater concern is that DOE has not ensured that

its project management requirements are consistently followed. For 

example, DOE officials initially did not require the contractor to follow all 

project management requirements on a project to demonstrate an 

alternative waste treatment technology at DOE’s Hanford site. Therefore, 

the project was initiated without using key project management tools, 

such as an independent review of the cost and schedule baseline. After the 

project experienced significant schedule and technical problems and the 

estimated cost more than tripled to about $230 million, DOE began 

requiring that the project be managed consistent with its project 

management requirements. In addition, we reported in January 2007 that 

cost and schedule status information on four NNSA projects, estimated to 

cost over $100 million each, was not being reported into DOE’s project 

tracking system, and therefore, the projects were not receiving senior 

management oversight. 

To help strengthen management of DOE’s projects and to better ensure 

that projects are completed on time and within budget, we are 

recommending that DOE take steps to ensure that project management 

Page 6 GAO-07-518 DOE Project Management
requirements are consistently followed and that any exceptions to 

following the requirements are carefully reviewed and approved by senior

management. 

In its comments on a draft version of the report, DOE agreed with our 

recommendation and outlined steps that the department is taking or will 

take to strengthen project management. 

DOE relies on its contractors to operate its sites and carry out its diverse 

missions, including developing, maintaining, and securing the nation’s 

nuclear weapons capability; cleaning up the nuclear and hazardous wastes 

resulting from more than 50 years of weapons production; and conducting

basic energy and scientific research, such as mapping the human genome. 

This mission work is carried out under the direction of NNSA and DOE’s 

program offices, including the Offices of Environmental Management and 

Science. At the end of fiscal year 2006, DOE had fewer than 11,000

employees to provide oversight for work performed under contract by 

over 95,000 contractor employees.8

DOE’s contractors generally carry out the department’s missions by 

managing its projects. DOE defines a project as “a unique effort that 

supports a program mission having defined points for starting and ending, 

undertaken to create a product, facility, or system and containing 

interdependent activities planned to meet a common objective or 

mission.” A project is individually planned, approved, and managed in 

support of a program objective. Projects can include such diverse efforts 

as construction of multi-billion dollar facilities to treat radioactive and 

hazardous wastes, decontamination and demolition of excess facilities, or 

technology development activities. 

DOE’s Office of Engineering and Construction Management establishes 

policies and guidance for planning and managing projects. DOE’s Office of 

Procurement and Assistance Management and NNSA’s Office of 

Acquisition and Supply Management establish policies and guidance for 

awarding and administering the contracts under which the department’s 

projects are carried out. Officials from DOE’s programs, such as NNSA 

Background 

 8

At the end of fiscal year 2006, DOE had a total of about 15,000 full-time equivalent 

employees. Since over 4,000 of those employees worked for one of the department’s four

power marketing administrations, they are not included in the number available to provide 

oversight of contractors’ efforts. 

Page 7 GAO-07-518 DOE Project Management
and the Offices of Environmental Management and Science, provide 

oversight to ensure that the contractors are managing projects to support 

DOE’s missions. In addition to the oversight of projects provided by the 

Office of Engineering and Construction Management, DOE’s three largest 

program elements—NNSA and the Offices of Environmental Management 

and Science—established project management support offices within their 

organizations. These project management support offices coordinate 

efforts within the program, provide additional oversight of projects, and 

conduct more detailed reviews of individual projects. 

Since 1999, DOE has worked to improve its approach to managing projects 

in three key areas of concern identified by the National Research 

Council—strengthening project management policies and guidance, 

developing consistent and objective performance information on ongoing

projects, and improving the quality of federal oversight. 

The first key area that DOE focused on was strengthening its project 

management policies and guidance to incorporate industry practices as 

recommended by the National Research Council. In its 1999 report, the 

council found that DOE lacked comprehensive project management 

policies and guidance and that there was little emphasis on early planning 

for projects. 

To incorporate industry practices into its project planning and 

management, DOE implemented a new project management order and 

guidelines that established a systematic process commonly used in private 

industry for managing and overseeing projects, from identification of need 

through project completion. DOE issued its project management order in 

October 20009

 and in March 2003, issued a project management manual, 

containing supplemental information and guidance on applying the order 

to individual projects. In July 2006, DOE revised the order to, among other 

things, reflect lessons learned since October 2000, including how to 

improve the quality of the documentation supporting project decisions.10

Furthermore, the July 2006 order clarified how the project management 

guidelines should be applied both to environmental management cleanup 

projects and to information technology projects.

DOE Has Improved 

Its Approach to 

Managing and 

Overseeing Projects 

Project Management 

Policies and Guidance 

Now Incorporate Industry 

Practices

 9

DOE Order 413.3, issued October 13, 2000.

10DOE Order 413.3A, issued July 28, 2006. 

Page 8 GAO-07-518 DOE Project Management
The project management order provided a much more specific framework 

for planning, managing, and overseeing a project. For example, prior to 

2000, DOE’s previous order on the acquisition of capital assets had a 

stated objective of managing physical assets in a safe and cost effective 

manner to meet the DOE mission.11 In contrast to that more general 

objective, the stated objective in the October 2000 project management 

order was to provide project management direction with the goal of 

delivering projects on schedule, within budget, and fully capable of 

meeting standards for mission performance, and safeguards and security, 

as well as environmental, safety, and health standards. 

In addition, the October 2000 order required a far more structured process 

for carrying out a project. Specifically, the order established major 

milestones—or critical decision points—that span the life of a project. For 

example, critical decision points for a construction project include (1) 

approving mission need, (2) approving the selection of the alternative and

cost range, (3) approving the performance baseline (cost, schedule, and

scope), (4) approving the start of construction, and (5) approving the start 

of operations or project completion. The order specifies the requirements 

that must be met, with the documentation necessary to move past the 

decision point. In addition, DOE senior management must review the 

supporting documentation and approve the project at each critical 

decision point.12

Overall, the revised policies and guidance provide more structure, 

discipline, and control over the management of DOE’s projects, and more 

information on projects is available for review and approval. For example, 

for the decision point when an alternative is selected and the cost range 

for the project is identified, the program office needs to document why it 

selected the preferred approach from the various alternatives considered, 

develop an acquisition strategy, and develop a range of estimated costs to

complete the project. Senior DOE management must review and approve 

the planned approach before the project can proceed. Under the previous 

order, there was more limited review in the early phases of a project, and 

 11The order provided little additional information on how to do this. 

12DOE’s project management order also establishes the level of approval authority required 

for projects depending on the total project cost. For example, in the July 2006 revision, 

generally the approval authority is the Secretarial Acquisition Executive for major projects

with a total project cost over $750 million, an undersecretary for projects with a total 

project cost between $100 million and $750 million, and a program secretarial officer for 

projects less than $100 million. 

Page 9 GAO-07-518 DOE Project Management
it was not until later in the project that the program office documented the 

mission need and a range of estimated costs. In addition, the previous 

order did not specifically require senior management review in the early

phases of a project. 

Another way in which the order strengthens project planning and 

management is by requiring and emphasizing the use of integrated project

teams. These teams, led by the federal project director, bring together 

expertise from the program office, along with the knowledge, skills, and 

abilities from other program and staff offices within the department, such 

as the Office of General Counsel, to support the federal project director in 

successfully executing a project. The integrated project team generally

includes members who can provide legal and contracting expertise, in 

addition to helping the project director comply with safety, security, and 

environmental requirements. The previous order did not specifically 

require the use of an integrated project team for planning and carrying out 

a project. 

In 2004, DOE’s Office of Procurement and Assistance Management 

initiated a separate but related effort to strengthen DOE’s contracting 

practices by issuing new guidance intended to strengthen contract 

planning and management.13 The guidance included information on 

• how to select an appropriate contract type for a project and the factors to 

consider for each type of contract, taking into account the scope and 

complexity of the work to be performed, and the business, technical, and 

regulatory risks; 

• how to provide incentives for contractors to complete projects on time 

and within budget; 

• how to develop a contract management plan once the contract is awarded, 

including describing how the contracting officer and program managers 

will monitor contractor performance to ensure that the requirements of 

the contract will be met and that the contractor will be held accountable 

for results; and 

 13U.S. Department of Energy, Office of Procurement and Assistance Management, 

Acquisition Guide: A DOE Guide to the Award and Administration of Contracts

(Washington, D.C.: Revised August 2006). 

Page 10 GAO-07-518 DOE Project Management
• how to develop effective, results-oriented performance measures and 

incorporate incentives into contracts that will encourage meeting cost and 

schedule goals on projects. 

In the past, we have recommended other actions DOE could take to 

strengthen contract management for its major projects. Specifically, in

March 2005, we recommended that DOE develop new guidance on 

structuring and managing contracts.

14 In June 2005, DOE issued this new 

guidance, which covers such topics as how to incorporate project 

management requirements into contracts and the importance of having 

reliable project performance data to manage contracts. 

The second key area where DOE focused was developing more consistent, 

objective performance information on its ongoing projects, as the National 

Research Council recommended. Before 1999, DOE policies and guidance 

did not require systematic reporting of cost and schedule status on 

projects into a centralized project tracking system. In its 1999 report, the

National Research Council found that DOE had no consistent system for 

objectively tracking progress on its projects, identifying the potential for 

cost and schedule overruns, or providing status information to DOE senior 

management. As a result, the types of information contractors developed

and reported and the frequency of those reports varied across DOE’s 

program offices and field locations. 

In response to these concerns about the reliability of project performance 

information, DOE required its contractors to implement a uniform way of 

tracking and reporting a project’s status. This way of measuring project 

cost and schedule performance—called an earned value management 

system—is commonly used in private industry. At any point in time during 

a project, an earned value system relates the actual cost and actual 

schedule for accomplishing work to the planned cost and schedule. 

Generally, for DOE projects with a total project cost of $20 million or 

more, the contractor must have an earned value management system in 

place.15 To make the earned value performance data reported by the 

contractors available to DOE senior management, in 2001 DOE established 

a project tracking and reporting system. Each month DOE federal project 

DOE Has Developed a 

Project Tracking 

Information System and Is 

Improving the Quality of 

Project Performance Data 

 14GAO-05-123. 

15DOE requires that the contractor have the earned value management system in place by

the decision point that establishes the approved performance baseline for the project. 

Page 11 GAO-07-518 DOE Project Management
directors report the status of their projects into the system, including the 

contractors’ earned value management system performance data.16

In March 2005, we questioned the accuracy and completeness of the 

performance data in DOE’s project tracking and reporting system and 

recommended that the department assess the reliability of the contractors’ 

earned value management systems used to report project cost and 

schedule information.17 In 2005 DOE began reviewing the earned value

management systems used by its contractors. The purpose of these 

reviews is to determine if the contractor has an earned value management 

system that complies with the standards specified by the department. DOE 

uses a team approach to conduct the reviews, with the team including 

representatives from DOE’s Office of Engineering and Construction 

Management and the program offices. During the course of the review, the 

team may determine that the contractor’s system does not fully comply 

with DOE guidelines for earned value management systems. In such cases, 

the team generates a corrective action request, and the contractor must 

develop a corrective action plan to address any deficiencies. Once the 

corrective actions have been taken and verified, DOE certifies the 

contractor’s system, which may provide data on several ongoing projects. 

As of September 2006, DOE had certified earned value management 

systems for eight of its contractors, which manage a combined total of 40

of DOE’s 96 ongoing projects. 

The third key area DOE focused on was strengthening federal oversight of 

projects through improving the skills of federal project directors and 

increasing the frequency of reviews of ongoing projects. In its 1999 report, 

the National Research Council cited DOE’s failure to develop the project 

management skills of its personnel as a fundamental cause of poor 

performance on projects. The council also found that DOE did not 

consistently review its ongoing projects to identify and address problems 

before there was a significant impact on project performance. 

DOE Is Strengthening 

Oversight by Providing 

Training to Enhance the 

Skills of Federal Project 

Directors and Conducting 

More Frequent Reviews of 

Ongoing Projects 

 16Although DOE established the project tracking and reporting system in 2001, it took until 

October 2002 for the contractors and federal project directors to provide information on all 

ongoing projects so that DOE could begin to summarize and report performance data from

the system. 

17GAO-05-123. 

Page 12 GAO-07-518 DOE Project Management
To enhance the skills of federal project directors, in 2003 DOE established 

a project management career development program. This program defined 

the necessary combination of training and experience to obtain 

certification as a DOE federal project director. It also established four 

levels of certification and required increasing amounts of training and 

experience for each succeeding level.

18 The training curriculum includes 

earned value management systems, acquisition strategy and planning, and 

cost and schedule estimating. In addition to the training courses and work 

experience requirements, federal project directors seeking the top two 

levels of certification must also successfully complete an interview with 

DOE’s certification review board.19 This board includes representatives 

from the Office of Engineering and Construction Management, and DOE’s 

three largest component organizations (NNSA and the Offices of 

Environmental Management and Science). Once federal project directors 

have obtained certification from the review board, they must also meet 

continuing education requirements to maintain their certification. As of 

May 2006, DOE met its goal of having all 96 of its active federal project 

directors at least at the first level of certification.

DOE has also taken steps to strengthen project oversight by requiring 

independent reviews at critical decision points. The independent reviews 

typically occur at the first three critical decision points on a project and

are performed either by a team of DOE officials from outside the 

sponsoring program office, by DOE’s Office of Engineering and 

Construction Management, or by outside organizations. Specifically, these

reviews include: 

• At the first critical decision point, approving mission need, DOE requires 

an independent review of major projects (those with an estimated total 

project cost over $750 million) to validate the mission need and the cost 

range. For projects below the major project dollar threshold, the approval

authority reviews the mission need statement and cost range as part of the 

supporting documentation at this critical decision point. 

• At the second critical decision point, approving the selection of the 

alternative and the estimated cost range, DOE requires an independent 

 18For example, a federal project director with level-1 certification can be responsible for a 

project with a total project cost up to $20 million, while a project with a total project cost 

over $400 million requires a level-4 certification. 

19The board’s main purpose is to review the qualifications of federal project directors 

applying for certification. 

Page 13 GAO-07-518 DOE Project Management
review of (1) the acquisition strategy, including the rationale for selecting

the preferred alternative; (2) design and construction plans for high-risk, 

high-hazard nuclear facilities to ensure that safety and security 

requirements are effectively integrated into the facility; and (3) design 

specifications to ensure that the facility will meet operational 

requirements. 

• At the third critical decision point, approving the performance baseline, 

DOE requires an independent review of the estimated costs and schedule 

associated with the project, to provide reasonable assurance that the 

project can be successfully carried out. 

In addition to the independent reviews at critical decision points, DOE 

also required quarterly progress reviews on all ongoing projects having a 

total estimated cost of $5 million or more. These quarterly reviews are 

conducted by senior program officials, representatives from the Office of 

Engineering and Construction Management, and other departmental 

organizations as appropriate. The purpose of these progress reviews is to 

identify potential problems and concerns and develop corrective action 

plans that will help ensure successful project completion. 

As a further step to improve the quality of federal oversight, in an August 

2005 memorandum to all DOE senior managers, the Secretary of Energy 

stressed the importance of following project management policies and 

guidance. The Secretary stated that all program managers, federal project 

directors, and contracting officers should be held accountable for meeting 

cost, schedule, and performance targets on their projects. 

Page 14 GAO-07-518 DOE Project Management
Despite DOE efforts to improve project management and strengthen 

oversight of its contractors, overall project performance has not improved. 

Starting in fiscal year 2003, DOE set a performance goal of having 85

percent of its ongoing projects within a 10 percent variance of approved 

cost and schedule baseline targets, and starting in fiscal year 2004, DOE 

increased the goal to 90 percent of projects.20 Although we have expressed 

concern about the reliability of the data in DOE’s project tracking system, 

the summary performance data reported by the department are useable to

show trends.21

DOE began summarizing and reporting monthly project performance data

in October 2002.22 Since October 2002, DOE has achieved its performance 

goals for line item construction projects (generally funded separately in

the government’s annual budget) only about one third of the time. As 

figure 1 below shows, the percentage of line item construction projects 

meeting DOE’s performance goal has been relatively steady, seldom falling 

below 80 percent or exceeding 90 percent. 

DOE Has Not 

Demonstrated 

Improved Project 

Performance 

 20Starting in November 2005, DOE included these project performance goals in its action

plan to improve results in contract and project management, an area designated by GAO

since 1990 as being at high-risk for fraud, waste, abuse, and mismanagement. This plan was 

developed in response to a request by the Office of Management and Budget for federal

agencies with areas on the GAO high-risk list to demonstrate how the agencies would 

address program weaknesses and improve results. Starting in fiscal year 2007, in response

to comments from GAO and the Office of Management and Budget on its action plan, DOE

developed three separate performance goals for its ongoing projects, depending on the 

total project cost. The goal is 85 percent for projects with a total project cost less than $750 

million, and the goal is 50 percent for projects with a total project cost more than $750 

million.

21Although in a past report (GAO-05-123) we expressed concerns with the accuracy and

completeness of the data in DOE’s project tracking system, we have determined that the

data are sufficiently reliable to present trends in meeting DOE’s performance goals. See 

appendix I.

22DOE collects and summarizes performance information only on those projects that have

passed the critical decision point for an approved cost and schedule performance baseline.

For example, as of September 2006, DOE had 206 ongoing projects, but over half of those 

were in the early planning phases of the project. 

Page 15 GAO-07-518 DOE Project Management
Figure 1: Percentage of Ongoing Line Item Construction Projects within 10 Percent of Cost and Schedule Baseline, October 

2002 through September 2006

20

0

30

40

50

60

70

80

90

100

Oct. 2002 Apr. 2003 Oct. 2003 Apr. 2004 Oct. 2004 Apr. 2005 Oct. 2005 Apr. 2006 Oct. 2006

Percentage

Source: DOE.

Month-year

Goal

Note: In October 2003, DOE changed the goal (percentage of ongoing projects within 10 percent of 

cost and schedule baseline) from 85 percent to 90 percent. 

In part, because of concerns about the accuracy and timeliness of the 

project data shown above, when assessing the overall status of an ongoing

project, DOE’s Office of Engineering and Construction Management uses 

the earned value management information (cost and schedule 

performance indicators) in concert with other information. Specifically, 

for each ongoing project, DOE also considers information such as the 

results of project reviews carried out by the program offices, information 

on emerging issues and concerns raised at quarterly progress reviews, 

discussions with program managers and federal project directors, the 

status of certification of the contractor’s earned value management 

system, and any safety concerns raised by the Defense Nuclear Facilities 

Safety Board or other outside organizations. 

Taking these other sources of information into account can affect DOE’s 

determination of whether a project is likely to meet cost and schedule 

performance targets. For example, the Office of Science is constructing a 

facility at the Stanford Linear Accelerator Center in California that will be

Page 16 GAO-07-518 DOE Project Management
used to produce a light source that is 10-billion times greater than any 

existing man-made light source and will use the high-brightness light in 

experiments in chemical, material, and biological sciences. This project, 

with a total cost of $379 million, had earned value management cost and 

schedule indicators in September 2006 that were within the acceptable 

range for meeting cost and schedule performance targets. However, the

earned value indicators reflect only the current status of the project and 

may not accurately depict future events or predict future performance. On 

this project, when DOE’s Office of Engineering and Construction 

Management took into account other sources of information, such as 

discussions with the federal project director, DOE determined that some 

of the construction bids had come in significantly higher than estimated. 

Therefore, until DOE could determine the extent of the cost increases and 

the potential impact on the total cost of the project, the monthly status 

report listed this project as one at risk for breaching its cost and schedule 

performance baseline. 

In February 2004, DOE began reporting performance information 

separately for cleanup projects funded by the Office of Environmental 

Management using annual operating funds, rather than using line item 

construction funding. Prior to February 2004, performance information on 

these “operating projects” had been included with the line item 

construction projects. Since February 2004, considering only these 

“operating” projects, as shown in figure 2, DOE met the cost and schedule 

performance targets only about 21 percent of the time. 

Page 17 GAO-07-518 DOE Project Management
Figure 2: Percentage of Ongoing Office of Environmental Management Operating Projects within 10 Percent of Cost and

Schedule Baseline, February 2004 through September 2006 

20

0

30

40

50

60

70

80

90

100

Feb. 2004 Aug. 2004 Feb. 2005 Aug. 2005 Feb. 2006 Aug. 2006

Percentage

Source: DOE.

Month-year

Goal

However, the performance data shown in figure 2 does not represent all of 

the Environmental Management operating projects. In November 2005,

DOE began reporting on the performance of operating projects only if the 

cost and schedule baselines of the projects had been independently 

validated. Therefore, in November 2005, although DOE’s Office of 

Environmental Management had a total of 77 operating projects, only 16 

had validated baselines and were included in the performance reporting.

DOE determined that the remaining 61 operating projects—those with 

baselines that had not been independently validated— had cost and 

schedule targets that could be overly optimistic, and therefore including 

those projects would distort the performance trends. 

Anecdotal evidence also indicates that cost increases and schedule delays

continue to occur on individual DOE projects. In March 2007, we reported 

that our review of 12 of the department’s major projects showed that 9 of 

the 12 exceeded their original cost or schedule estimates, principally 

because of ineffective DOE project oversight and poor contractor 

Page 18 GAO-07-518 DOE Project Management
management.23 Specifically, 8 of the 12 projects experienced cost increases

ranging from $79 million to $7.9 billion, and 9 of the 12 projects were 

behind schedule by 9 months to more than 11 years. 

Nevertheless, senior DOE officials in both the Office of Management and 

program offices said they believe the department has made real progress 

in putting improved project management tools in place and emphasizing 

the importance of effective federal oversight of projects. They added that

the improvements made in project planning, independent reviews at 

critical decision points, and a greater emphasis on federal oversight should 

result in improved project performance in the future. 

DOE could further strengthen management of its projects by completing 

implementation of its project management improvement efforts and 

ensuring that all of the department’s component organizations consistently 

follow the project management requirements. 

DOE has not fully implemented two of its improvement efforts—reviewing 

and certifying contractors’ earned value management systems and issuing 

revised guidance to supplement the July 2006 project management order. 

However, the department is making progress in these two areas and has a 

plan for completing these efforts. 

DOE Has Not Fully 

Implemented Its 

Project Management 

Improvement Efforts 

or Ensured That 

Project Management 

Requirements Are 

Consistently Followed 

DOE Has Not Fully 

Implemented Project 

Management Improvement 

Efforts 

One improvement effort not fully implemented has been to review and 

certify contractors’ earned value management systems, which are used to

develop and report on the cost and schedule performance of DOE’s 

projects. DOE uses this information, along with other information 

obtained from federal project directors and program managers, to 

determine whether ongoing projects are on target to meet cost and 

schedule performance goals. Furthermore, DOE also factors in this 

 23GAO-07-336. 

Page 19 GAO-07-518 DOE Project Management
information when calculating the amount of any incentive fees paid to the 

contractors under performance-based contracts. Therefore, the accuracy 

and reliability of the data produced by the earned value management 

systems is crucial to DOE’s oversight of both individual projects and its 

contractors. 

DOE began its efforts to review and certify the contractors’ earned value

management systems in fiscal year 2005. As of September 2006, DOE had 

reviewed and certified contractor earned value management systems for 8 

of 29 contractors. These 8 contractors manage 40 of DOE’s 96 projects that

require an earned value management system. In March 2005, we had 

recommended that DOE develop a schedule for assessing the reliability of 

its contractors’ earned value management systems.24 In response to that 

recommendation and as part of DOE’s action plan to address the high-risk 

area of contract and project management, DOE established annual targets 

for the number of contractor systems to be reviewed. For example, the 

target for fiscal year 2006 was to review and certify 10 contractor systems. 

Another improvement effort not fully implemented is the development of 

new project management guidance to provide supplemental information to 

the July 2006 revised project management order. These implementation 

guides are being developed by teams led by a program office and assisted 

by the Office of Engineering and Construction Management, other DOE 

program offices as appropriate, and representatives from a DOE 

contractor working group. The implementation guides will cover such 

topics as safeguards and security, risk management, and how to apply the 

project management guidelines to Office of Environmental Management’s

operating projects or information technology projects. One of the 

implementation guides—further explaining how a tailoring strategy should

be developed for a project—has an estimated issue date of May 2007.

According to the charter for the team developing this guide, tailoring the 

processes in the project management order may be appropriate for 

smaller, less complex, lower risk projects, but tailoring does not imply 

omitting any essential steps in the project planning and execution 

processes. Completing development of these implementation guides will 

clarify requirements and may help DOE’s program offices be more 

consistent in planning and executing projects. According to the current 

schedule, the last of the implementation guides is expected to be issued in

September 2008. However, since the guidance will be subject to DOE’s 

 24GAO-05-123. 

Page 20 GAO-07-518 DOE Project Management
internal review procedures and concurrence by DOE’s program offices, it 

may take longer. 

DOE Has Not Consistently 

Followed Project 

Management Requirements 

DOE also has not ensured that its component organizations have 

consistently followed project management requirements. Even though the 

project management requirements have been in place since October 2000, 

there are still instances where projects are initiated or carried out without 

fully complying with the processes and controls contained in DOE’s 

policies and guidance. Examples include: 

• In our April 2006 report on the Hanford Waste Treatment Plant, we 

reported that the estimated costs of this project to construct facilities to 

treat and prepare for disposal 55 million gallons of high-level radioactive 

waste had increased significantly. 25 Since the contract was awarded in 

2000, estimated costs have increased from about $4.3 billion to over $12 

billion and the completion date has been extended from 2011 to 2019, 8 

years later than the milestone included in DOE’s agreement with its 

regulators. We found that one of the contributing factors to the cost 

increases and schedule delays was DOE’s lack of oversight and its failure 

to ensure adherence to normal project reporting requirements. 

Specifically, the contractor had been adjusting the project performance 

baseline to match actual results, which masked the full extent of the 

problems with the project. 

• In December 2005, DOE’s Office of Inspector General reported on the 

status of a project to construct a facility at the Savannah River site in 

South Carolina to dispose of surplus plutonium by converting it into fuel 

for commercial nuclear power plants.26 The report stated that although 

construction of the facility had not started, significant cost growth had 

already occurred, in part because of weaknesses in project management. 

Specifically, the Office of Inspector General found that DOE had not given

adequate attention to establishing a performance baseline or ensuring that 

reporting mechanisms to monitor progress and track costs were effective.

Furthermore, DOE officials had not provided adequate oversight of the 

project to ensure that contractor performance problems were identified in

a timely manner. 

 25GAO-06-602T. 

26U.S. Department of Energy, Office of Inspector General, Status of the Mixed Oxide Fuel 

Fabrication Facility, DOE/IG-0713 (Washington, D.C.: Dec. 21, 2005). 

Page 21 GAO-07-518 DOE Project Management
• In January 2007, we reported that about 16 percent of NNSA’s projects 

were in jeopardy of breaching their cost baseline, schedule baseline, or 

both, and recommended actions that NNSA could take to strengthen its 

management of projects.27 In addition, we found that cost and schedule 

status information on four of NNSA’s projects, estimated to cost over $100 

million each, was not being reported into DOE’s project tracking and 

reporting system. As a result, these projects were not receiving senior 

management oversight.

• DOE’s project to demonstrate an alternative technology to treat lowactivity radioactive waste at DOE’s Hanford site involved building a pilot

plant to demonstrate the technology and treat waste from one of the 

underground waste storage tanks. The original estimated cost of the 

project was about $62 million and was to be carried out over a 2-year 

period. DOE officials initially did not require the contractor to follow all 

project management requirements, and therefore, the project was initiated 

without using key project management tools, such as an acquisition 

strategy or independent reviews of the cost and schedule baseline. 

According to DOE officials, even though the estimated cost of the project 

met the criteria for following the project management requirements (total 

project cost was in excess of $20 million), they decided to accelerate the 

project’s schedule and therefore decided that the project did not need to 

follow the project management requirements. Within the first 2 years, the 

project experienced significant schedule and technical problems and the 

estimated cost more than tripled to about $230 million. DOE then assigned 

a federal project director and began requiring that the project be managed

consistent with its project management requirements.28

DOE relies primarily on contractors to carry out its environmental 

cleanup, scientific research, nuclear weapons management, and other 

missions vital to safety, security, and the nation’s energy supply. Because

these contractors also frequently construct and operate complex, one-of-akind facilities to carry out these missions, it is crucial that the department 

manage and oversee these projects to successful completion. Over the 

years, we have issued numerous reports on the challenges that the 

department faces in overseeing such projects and have made a series of 

recommendations on steps DOE could take to strengthen management 

Conclusions 

 27GAO-07-36. 

28A forthcoming GAO report will provide greater detail on the management of this project. 

Page 22 GAO-07-518 DOE Project Management
and oversight of its projects. Although DOE has made progress in 

addressing its project management weaknesses, such as by incorporating 

industry best practices into its policies and guidance, to date overall 

performance in achieving cost and schedule goals has not substantially 

improved. Furthermore, DOE has yet to fully implement all of its project 

management improvement efforts, such as reviewing and certifying 

contractors’ earned value management systems that provide critical cost 

and schedule performance information, and continued attention is needed

to better ensure that the improved project management policies and 

guidance are consistently followed. As DOE goes forward with efforts to 

strengthen management of its projects, including implementing our 

previous recommendations, consistent application of the project 

management requirements, accurate and reliable project performance 

data, and strong oversight are key to obtaining and demonstrating 

improved performance. Without addressing these areas, cost overruns on 

projects could continue to drain the department’s resources, and 

excessive schedule delays could affect the department’s ability to 

effectively carry out its missions. 

To help strengthen management of DOE’s projects and to enhance 

accountability for completing projects on time and within budget in all of 

DOE’s component organizations, we recommend that the Secretary of 

Energy ensure that project management requirements are consistently and 

rigorously followed by all of the department’s component organizations, 

and that any exceptions to following the requirements are allowed only 

after senior management has ensured that the exceptions are appropriate

and has approved them. 

We provided a draft of this report to DOE for review and comment. In 

written comments, the Director of the Office of Management agreed with

our findings and accepted our recommendation. DOE acknowledged that 

the department can further strengthen project management and stated that 

it recognizes that the results of implementing project management 

improvements will have a gradual impact on project performance. 

DOE recommended that we modify the draft report to clarify the 

distinction between project management guidelines and requirements. We 

agree and have revised the report accordingly. DOE’s comments on our 

draft report are included in appendix II. 

Recommendation for 

Executive Action 

Agency Comments 

and Our Evaluation 

Page 23 GAO-07-518 DOE Project Management
We are sending copies of this report to the Secretary of Energy, the 

Director of the Office of Management and Budget, and appropriate 

congressional committees. We will also make copies available to others on

request. In addition, the 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 on this report, please contact me at 

(202) 512-3841 or aloisee@gao.gov. Contact points for our Offices of 

Congressional Relations and Public Affairs may be found on the last page 

of this report. GAO staff who made major contributions to this report are 

listed in appendix III. 

Gene Aloise 

Director, Natural Resources and Environment 

Page 24 GAO-07-518 DOE Project Management
Appendix I: Scope and Methodology Appendix I: Scope and Methodology 

To determine DOE’s main efforts since 1999 to address weaknesses in its 

project management, we reviewed and analyzed prior and current DOE 

policies and guidance on managing projects and administering contracts. 

We also reviewed and analyzed DOE efforts to improve its management 

processes, including those in response to the President’s Management 

Agenda and those that were part of a plan DOE developed in response to 

an Office of Management and Budget request that agencies with activities 

on GAO’s high-risk list develop an action plan for improvement. In 

addition, we interviewed senior DOE headquarters officials to identify 

improvement efforts that the department had taken or had in process. We 

focused our review of actions taken by DOE’s program offices on the 

department’s three largest elements by percentage of the annual budget—

NNSA and the Offices of Environmental Management and Science. These

three offices represent about 80 percent of the department’s annual 

budget. 

To determine the extent to which performance on DOE’s projects has 

improved, we reviewed and analyzed DOE’s monthly status reports on 

projects and related supporting documentation. Since we have expressed 

concerns about the reliability of the data in DOE’s project tracking and 

reporting system in a prior report, we did not develop our conclusions or 

findings based on information generated from that system.1

 However, we 

did determine that the data were sufficiently reliable to present trends in

meeting DOE’s performance goals over time, and have described our 

concerns with the accuracy and completeness of the performance data in 

this report. As DOE reviews and certifies the remaining earned value

management systems used by its contractors, the accuracy and 

completeness of the data may improve. However, there are still other 

limitations to the data in DOE’s project tracking and reporting system, 

such as that data on projects are reported at an aggregate project level, 

rather than at a more detailed level showing key milestones and critical 

activities. We also reviewed and analyzed prior GAO reports and 

recommendations on DOE project management to identify anecdotal 

information concerning performance of individual DOE projects. 

To determine the extent to which DOE’s improvement efforts have been 

fully implemented or consistently followed, we reviewed and analyzed 

previous GAO reports and reports from DOE’s Office of Inspector General 

and the four reports on improving project management in the Department 

 1

GAO-05-123. 

Page 25 GAO-07-518 DOE Project Management
Appendix I: Scope and Methodology 

of Energy from the National Research Council. These reports discussed 

weaknesses in DOE project management, contractor performance and 

federal oversight of individual projects, and DOE’s efforts to improve 

management of contracts and associated performance measures. In 

addition, we reviewed the status of previous GAO recommendations to 

determine if they had been implemented. We also reviewed and analyzed

reports from DOE’s Office of Engineering and Construction Management 

on the status of certifying contractors’ earned value management systems 

and the schedule for developing supplemental guidance to the July 2006

revised project management order. 

On October 12, 2006, we briefed your staff on our results to date, and this 

report documents information presented in that briefing. 

We conducted our work from June 2006 to April 2007 in accordance with 

generally accepted government auditing standards. 

Page 26 GAO-07-518 DOE Project Management
Appendix II: Comments from the Department Appendix II: Comments from the Department of Energy 

of Energy 

Page 27 GAO-07-518 DOE Project Management
Appendix II: Comments from the Department 

of Energy 

Page 28 GAO-07-518 DOE Project Management
Appendix III: GAO

A

 Contact and Staff 

cknowledgments 

Page 29 GAO-07-518

Appendix III: GAO Contact and Staff 

Acknowledgments 

Gene Aloise (202-512-3841) or aloisee@gao.gov

In addition to the individual named above, Bill Swick, Assistant Director; 

Carole Blackwell, Ryan Coles, Heather Dowey, Doreen Feldman, Amanda 

Miller, and Alison O’Neill made key contributions to this report. 

GAO Contact 

Staff 

Acknowledgments 

DOE Project Management
Related GAO Products Related GAO Products 

Department of Energy: Major Construction Projects Need a Consistent Approach for 

Assessing Technology Readiness to Help Avoid Cost Increases and Delays. GAO-07-

336. Washington, D.C.: March 27, 2007. 

National Nuclear Security Administration: Additional Actions Needed to Improve 

Management of the Nation’s Nuclear Program. GAO-07-36. Washington, D.C.: 

January 19, 2007. 

Nuclear Cleanup of Rocky Flats: DOE Can Use Lessons Learned to Improve 

Oversight of Other Sites’ Cleanup Activities. GAO-06-352. Washington, D.C.: July 10,

2006. 

DOE Contracting: Better Performance Measures and Management Needed to 

Address Delays in Awarding Contracts. GAO-06-722. Washington, D.C.: June 30,

2006. 

Hanford Waste Treatment Plant: Contractor and DOE Management Problems Have 

Led to Higher Costs, Construction Delays, and Safety Concerns. GAO-06-602T. 

Washington, D.C.: April 6, 2006. 

Yucca Mountain: Quality Assurance at DOE’s Planned Nuclear Waste Repository 

Needs Increased Management Attention. GAO-06-313. Washington, D.C.: March 17, 

2006. 

Department of Energy: Improved Guidance, Oversight, and Planning Are Needed to 

Better Identify Cost-Saving Alternatives for Managing Low-Level Radioactive 

Waste. GAO-06-94. Washington, D.C.: October 31. 2005. 

Department of Energy: Further Actions Are Needed to Strengthen Contract 

Management for Major Projects. GAO-05-123. Washington, D.C.: March 18, 2005. 

Nuclear Waste: Absence of Key Management Reforms on Hanford’s Cleanup Project 

Adds to Challenges of Achieving Cost and Schedule Goals. GAO-04-611. Washington,

D.C.: June 9, 2004. 

Nuclear Waste Cleanup: DOE Has Made Some Progress in Cleaning Up the Paducah 

Site, but Challenges Remain. GAO-04-457. Washington, D.C.: April 1, 2004. 

Department of Energy: Mission Support Challenges Remain at Los Alamos and 

Lawrence Livermore National Laboratories. GAO-04-370. Washington, D.C.: 

February 27, 2004. 

Page 30 GAO-07-518 DOE Project Management
Related GAO Products 

Nuclear Weapons: Opportunities Exist to Improve the Budgeting, Cost Accounting,

and Management Associated with the Stockpile Life Extension Program. GAO-03-

583. Washington, D.C.: July 28, 2003.

Contract Reform: DOE’s Policies and Practices in Competing Research Laboratory 

Contracts. GAO-03-932T. Washington, D.C.: July 10, 2003. 

Nuclear Waste: Challenges to Achieving Potential Savings in DOE’s High-Level 

Waste Cleanup Program. GAO-03-593. Washington, D.C.: June 17, 2003. 

Department of Energy: Status of Contract and Project Management Reforms. GAO03-570T. Washington, D.C.: March 20, 2003. 

Contract Reform: DOE Has Made Progress, but Actions Needed to Ensure 

Initiatives Have Improved Results. GAO-02-798. Washington, D.C.: September 13, 

2002. 

Nuclear Waste: Technical, Schedule, and Cost Uncertainties of the Yucca Mountain 

Repository Project. GAO-02-191. Washington, D.C.: December 21, 2001. 

Department of Energy: Fundamental Reassessment Needed to Address Major 

Mission, Structure, and Accountability Problems. GAO-02-51. Washington, D.C.: 

December 21, 2001. 

Department of Energy: Follow-Up Review of the National Ignition Facility. GAO-01-

677R. Washington, D.C.: June 1, 2001.

Nuclear Cleanup: Progress Made at Rocky Flats, but Closure by 2006 Is Unlikely, 

and Costs May Increase. GAO-01-284. Washington, D.C.: February 28, 2001. 

National Ignition Facility: Management and Oversight Failures Caused Major Cost

Overruns and Schedule Delays. GAO/RCED-00-271. Washington, D.C.: August 8, 2000. 

Department of Energy: Uncertainties and Management Problems Have Hindered 

Cleanup at Two Nuclear Waste Sites. GAO/T-RCED-00-248. Washington, D.C.: July 12, 

2000. 

Nuclear Waste: Observations on DOE’s Privatization Initiative for Complex 

Cleanup Projects. GAO/T-RCED-00-215. Washington, D.C.: June 22, 2000. 

Nuclear Waste: DOE’s Advanced Mixed Waste Treatment Project: Uncertainties May 

Affect Performance, Schedule, and Price. GAO/RCED-00-106. Washington, D.C.: April 

28, 2000. 

Page 31 GAO-07-518 DOE Project Management
Related GAO Products 

Nuclear Waste Cleanup: DOE’s Paducah Plan Faces Uncertainties and Excludes 

Costly Cleanup Activities. GAO/RCED-00-96. Washington, D.C.: April 28, 2000. 

(360775) Page 32 GAO-07-518 DOE Project Management
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