Managing Critical Isotopes: Weaknesses in DOE's Management of Helium-3 Delayed the Federal Response to a Critical Supply Shortage
Published: 2011-05-12T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: Helium-3 gas is a key component of equipment used at ports and border crossings to detect radiation and prevent the smuggling of nuclear material into the United States, among other uses. The National Nuclear Security Administration (NNSA), a separate agency within the Department of Energy (DOE), extracts helium-3 and controls the inventory. Since 2003, NNSA has made helium-3 available for sale to DOE's Isotope Development and Production for Research and Applications Program (Isotope Program). After September 11, 2001, demand increased for radiation detection equipment, and in 2008, the federal government learned that it faced a severe domestic shortage of the gas. GAO was asked to review DOE's management of helium-3 to (1) determine the extent to which the federal government's response to the helium-3 shortage was affected by DOE's management of helium-3; (2) determine the federal government's priorities for allocating the limited supply of helium-3; and (3) describe the steps that the federal government is taking to increase the helium-3 supply and develop alternatives to helium-3. GAO reviewed DOE and NNSA documents and interviewed cognizant agency officials.
section_title: What GAO Found
paragraphs: The federal government's awareness of and response to the helium-3 shortage was delayed because no DOE entity had stewardship responsibility for the overall management of helium-3--a by-product of the radioactive decay of tritium, a key component of the U.S. nuclear weapons program. Although the Isotope Program's mission includes selling isotopes and providing related isotope services, senior program officials said that they interpret this mission to exclude helium-3 and 16 other isotopes that the program sells but whose supply it does not control. As a result of this weakness in DOE's management of helium-3, officials at the Isotope Program and NNSA did not communicate about the helium-3 inventory or its extraction rate. According to NNSA and Isotope Program officials, they communicated with each other about how much helium-3 to sell each year and at what price but not about the size of the helium-3 inventory or extraction rate because NNSA generally treated this information as classified, due to concerns that the helium-3 inventory could be used to calculate the size of the U.S. tritium stockpile. NNSA and Isotope Program officials told GAO that this lack of communication contributed to the federal government's delayed response to the helium-3 shortage. The standards for internal control in the federal government state that information should be communicated to management and others within a time frame that enables them to carry out their responsibilities. Further, without stewardship by a DOE entity, key risks to managing helium-3, such as the lack of complete information on the production and inventory of helium-3, were not identified or mitigated. The federal standards for internal control state that management should assess the risks faced from external and internal sources and decide what actions to take to mitigate them. Facing this critical shortage of helium-3, DOE and other federal agencies are collaborating to bring supply and demand into balance. Specifically, in July 2009, an interagency policy committee was formed, which halted allocations of helium-3 for domestic radiation detection equipment and established three priorities for allocating helium-3: (1) applications for which there are no alternatives to helium-3 have first priority (e.g., research that can be achieved only with helium-3); (2) programs for detecting nuclear material at foreign ports and borders have second priority; and (3) programs for which substantial costs have already been incurred have third priority (e.g., a DOE research facility that conducts physics research). To increase the supply of helium-3, the federal government is, among other things, pursuing other sources and developing alternatives. Specifically, NNSA is in discussions with Ontario Power Generation (OPG), a power company in Ontario, Canada, to obtain helium-3 from its stores of tritium. OPG has accumulated tritium as a by-product of producing electricity using a type of nuclear reactor not found in the United States. Also, federal agencies and private companies are researching alternative technologies to replace helium-3 in several applications to decrease demand.
section_title: What GAO Recommends
paragraphs: GAO recommends, among other things, that DOE clarify whether the stewardship for those isotopes produced outside the Isotope Program, such as helium-3, rests with the program or another DOE entity. DOE stated that it understands and can implement these recommendations.

section_title: Letter
paragraphs: Helium-3 gas is a critical component of radiation detection equipment,  including radiation detection portal monitors that are used to screen cargo  and vehicles at ports and border crossings around the world to prevent  nuclear material from being smuggled into the United States. For example,  the Department of Homeland Security (DHS) has deployed over 1,400  radiation detection portal monitors containing helium-3 at U.S. ports and  border crossings. In addition, helium-3 is used in various industrial  applications, such as oil and gas exploration and road construction, and in  research applications, including physics research requiring ultra-low  temperatures that can only be achieved using helium-3. Until 3 years ago,  the United States’ helium-3 supply was viewed as sufficient to meet  demand. Outside the United States, Russia has been the only other major  source of commercially available helium-3. But in 2008, the federal  government abruptly learned that it faced a severe shortage of helium-3. At  the same time Russia has curtailed its sales of helium-3, indicating that its  supply is also waning. Because of this global shortage, no future  deployments of radiation detection portal monitors containing helium-3  are planned in the United States.
Helium-3 is a byproduct of the radioactive decay of tritium, a key  component of the nation’s nuclear weapons that is used to enhance their  power. The U.S. tritium stockpile is maintained by the National Nuclear  Security Administration (NNSA), a separately organized agency within the  Department of Energy (DOE). In maintaining this tritium stockpile, NNSA  removes the helium-3 that accumulates as tritium decays because the  helium-3 can diminish the effectiveness of the nuclear weapons. In the  past, NNSA and its predecessor agencies considered helium-3 to be a  waste product of the weapons program and vented it to the atmosphere.  From about 1980 through 1995, and again from 2003 through 2008, NNSA  provided helium-3 to DOE’s Isotope Development and Production for  Research and Applications Program (Isotope Program) to sell. The Isotope  Program’s mission is to produce and sell isotopes and related isotope  services, maintain the infrastructure required to do so, and conduct  research and development on new and improved isotope production and  processing techniques. DOE’s Isotope Program produces and sells about  200 isotopes, though it does not control the supply—that is, the production  or inventory—of all the isotopes it sells, such as helium-3, which is  extracted from tritium by NNSA.
With the end of the Cold War, the United States has been reducing the  number of nuclear weapons in its stockpile, resulting in less tritium and,  therefore, less helium-3. In the aftermath of the September 11, 2001,  terrorist attacks, however, demand for helium-3 increased due to the  deployment of radiation detection portal monitors at ports and border  crossings in the United States and other countries to prevent the  smuggling of nuclear material. Thousands of such portal monitors were  deployed across the United States and overseas, and more are planned to  be deployed. Additionally, large quantities of helium-3 have been used in  the last 10 years by research facilities in the United States and  internationally for large-scale physics research applications, and more is  needed for this research to continue. Overall, this decreasing supply  during a period of increasing demand resulted in a shortage of helium-3.
In June 2008, a contractor alerted DHS that the contractor was unable to  obtain a sufficient amount of helium-3 to fulfill its contract to provide  radiation detection portal monitors. DHS contacted the Isotope Program  to inquire about the helium-3 supply, and in September 2008, DOE  responded to this sudden awareness of the shortage by suspending its  helium-3 sales through public auction, which was the vehicle through  which the Isotope Program sold helium-3. In March 2009, DHS, the  Department of Defense (DOD), DOE, and NNSA formed an integrated  project team to collect and analyze information and make  recommendations to senior management at these departments on actions  to be taken to address the shortage. The overall shortage of helium-3  raises concerns about the United States’ ability to provide a sustainable  supply of helium-3 for national security and research applications. In this  context, you asked us to review DOE’s management of helium-3. Our  objectives were to (1) determine the extent to which the federal  government’s response to the helium-3 shortage was affected by DOE’s  management of helium-3; (2) determine the federal government’s priorities  for allocating the limited supply of helium-3 to various users; and (3)  describe the steps that the federal government is taking, if any, to increase  the helium-3 supply and develop alternatives to helium-3.
subsections: section_title: Scope and Methodology
paragraphs: To determine the extent to which the federal government’s response to the  helium-3 shortage was affected by DOE’s management of helium-3, we  reviewed the DOE Isotope Program’s strategic planning documents,  helium-3 sales data, and information on NNSA’s inventory of helium-3. We  also interviewed officials at DOE, DOE’s Savannah River Site, NNSA, and  DHS, as well as representatives from Linde and GE Reuter-Stokes, the  two principal companies that purchased helium-3 from the Isotope  Program. Also, we used the federal standards for internal control to assess  DOE’s management of helium-3. To determine the federal government’s  priorities for allocating the limited supply of helium-3 to various users, we  reviewed documents of the integrated project team. We also reviewed the  helium-3 allocation decisions, criteria, and process of the interagency  policy committee convened in 2009 by the National Security Staff, which  report to the National Security Advisor, to oversee the integrated project  team and make policy decisions to manage the helium-3 shortage. The  policy committee is a multi-agency committee consisting of key agencies  and departments that use helium-3 applications to support their missions,  including the Department of Commerce’s National Institute of Standards  and Technology (NIST), DOD’s Defense Threat Reduction Agency, the  Department of State, DOE, and DHS. We also interviewed officials at NIST,  the Department of Health and Human Services’ National Institutes of  Health (NIH), DHS, DOD, DOE, DOE’s Oak Ridge and Pacific Northwest  National Laboratories, and NNSA, as well as National Security Staff. To  describe the steps that the federal government is taking, if any, to increase  the helium-3 supply and develop alternatives to helium-3, we reviewed  feasibility studies that presented options for alternative sources and  recycling unused equipment and interviewed representatives from Ontario  Power Generation, a Canadian power company. We reviewed research and  documentation, including test results, on alternatives to helium-3 that are  being developed by companies and interviewed representatives from these  companies and officials at DHS, DOD, DOE, NIH, NIST, NNSA, and Oak  Ridge National and Pacific Northwest National Laboratories. We  conducted this performance audit from April 2010 to May 2011, in  accordance with generally accepted government auditing standards. Those  standards require that we plan and perform the audit to obtain sufficient,  appropriate evidence to provide a reasonable basis for our findings and  conclusions based on our audit objectives. We believe that the evidence  obtained provides a reasonable basis for our findings and conclusions  based on our audit objectives.
section_title: Background
paragraphs: The unique physical properties of helium-3 have led to its use in a wide  variety of national security, scientific, industrial, and medical applications.  Helium-3 is widely used for detecting nuclear material and safeguarding  nuclear weapons because, among other things, of its ability to efficiently  absorb neutrons. In radiation detection equipment, helium-3 is used to  detect neutrons that are emitted by nuclear material. In radiation detection  portal monitors, long, thin metal tubes are filled with helium-3; neutrons  passing through these tubes react with the helium-3, creating charged  particles that are detected by the monitors. Also, as a nontoxic gas that is  not absorbed by the human body, helium-3 is used in magnetic resonance  imaging (MRI) to research pulmonary disorders, such as chronic  obstructive pulmonary disease.
Helium-3 is rare because it is currently extracted solely as a byproduct of  the radioactive decay of tritium. During the Cold War, the United States  produced tritium in nuclear reactors and stockpiled it for the nuclear  weapons program. Helium-3 is also available from natural sources, such as  subterranean natural gas deposits, but it has not been pursued  commercially in the past because it is found in very low concentrations.  NNSA and its predecessor agencies produced tritium at the Savannah  River Site K-reactor in South Carolina and purified tritium by removing  helium-3 at the Mound Plant, a weapons research laboratory in Ohio.  Following the end of the Cold War, as the United States reduced its  nuclear weapons stockpile and ceased producing tritium, its inventory of  helium-3 decreased commensurately. In 1988, DOE shut down the  K-reactor for safety reasons and, in 1995, closed the Mound Plant, thus  eliminating the U.S. government’s large-scale ability to produce and purify  tritium. NNSA has been able to meet the tritium needs of the nuclear  weapons program by maintaining the existing stockpile and recycling  tritium from dismantled nuclear warheads.
To maintain the current tritium stockpile, NNSA extracts helium-3 from  tritium on a daily basis and stores the helium-3 in pressurized cylinders at  the Savannah River Site. To remove trace amounts of tritium and other  impurities, NNSA ships these cylinders of helium-3 to Linde in New Jersey,  which operates the only commercial facility in the United States licensed  by the Nuclear Regulatory Commission to purify helium-3 of trace  amounts of tritium. While NNSA’s helium-3 inventory at the Savannah  River Site is constantly changing, as of early February 2011, it was almost  31,000 liters. NNSA estimates that about 8,000 to 10,000 liters of helium-3  will be made available per year from the current tritium stockpile. Like the  United States, Russia extracts helium-3 from its tritium stockpile.  According to National Security Staff documentation and representatives of  Linde, Russia has curtailed its sales of helium-3, indicating that its supply  is likely waning.
Isotope production and distribution has been a long-standing mission of  DOE. DOE’s Isotope Program provides isotopes to support the national  need for a reliable supply of isotopes used in medicine, industry, and  research. DOE transferred the Isotope Program to DOE’s Office of Science  from DOE’s Office of Nuclear Energy starting in fiscal year 2009. In  anticipation of this transfer, in August 2008, the Isotope Program  organized a workshop to discuss the nation’s needs for isotopes, and  identified those isotopes with supply challenges. As noted in the workshop  summary report, the workshop assembled, for the first time, stakeholders  from all the different areas of the diverse isotope community to discuss  the nation’s current and future needs for isotopes and to consider options  for improving the availability of needed isotopes. The workshop enabled  the Isotope Program to discuss and develop program priorities, including  those isotopes, such as helium-3, that were in short supply. This workshop  identified 12 isotopes, including helium-3, that faced supply challenges and  had less than 3 years before their supplies at that time were completely  consumed.
In August 2003, the Isotope Program signed a Memorandum of  Understanding (MOU) with NNSA to make available an initial 103,570  liters of helium-3 for sale, followed by at least 10,000 liters of helium-3 per  year from 2004 through 2008. At the time the MOU was signed, NNSA’s  inventory of helium-3 was estimated at about 260,000 liters. Following this  agreement, the Isotope Program held a series of public auctions to sell  helium-3. A public auction process was used, according to program  officials, to encourage competition. The Isotope Program and NNSA  determined the quantity and minimum price of helium-3 for each auction;  the price was set to recover the costs to extract helium-3 and the  administrative costs of selling it. Linde and GE Reuter-Stokes, a company  that manufactures helium-3 tubes for radiation detection portal monitors  and other neutron detection applications, have been the two buyers of  helium-3 who participated in the Isotope Program’s public auctions. From  2003 through 2009, the Isotope Program sold, or NNSA transferred, more  than 209,000 liters of helium-3—an average of almost 30,000 liters of  helium-3 per year, as shown in table 1. Given NNSA’s capacity to extract  between 8,000 and 10,000 liters of helium-3 annually, this rate of sale  exceeded the extraction rate and decreased the inventory.
Following the terrorist attacks of September 11, 2001, the demand for  helium-3 nearly tripled, because of the increased focus on radiation  detection applications. Specifically, DHS’s Radiation Portal Monitor  program, NNSA’s Second Line of Defense program, and DOD’s Guardian  program all use helium-3 in radiation detection portal monitors deployed  at domestic and foreign ports, border crossings, and military installations.  DHS alone has deployed over 1,400 radiation detection portal monitors  domestically. The largest demand for helium-3 has historically been for  homeland security and scientific research, but demand for other  applications, such as in MRIs for lung research, has also increased.
section_title: Federal Response to the Helium-3 Shortage Was Delayed by Weaknesses in DOE’s Management of Helium-3
paragraphs: The federal government’s awareness of and response to the helium-3  shortage was delayed because no DOE entity had stewardship  responsibility for the overall management of helium-3. As a result of this  lack of stewardship responsibility, officials from DOE’s Isotope Program,  which sold helium-3, and NNSA, which extracted it from tritium, did not  communicate about the helium-3 inventory or its extraction rate. Without  stewardship responsibility, key risks to managing helium-3, such as the  lack of understanding of the helium-3 inventory and the demand for  helium-3, were not identified or mitigated by either entity.
subsections: section_title: Officials from DOE’s Isotope Program and NNSA Did Not Communicate about the Helium-3 Inventory or Its Extraction Rate
paragraphs: While the Isotope Program’s mission includes selling isotopes and  providing related isotope services, senior program officials said that they  interpret this mission to exclude helium-3 and other isotopes that the  program sells but whose supply it does not control. Accordingly, Isotope  Program officials noted that the program sold and distributed helium-3  solely as a courtesy to NNSA, not because it was a core part of the  program’s mission or because it believed it had a stewardship  responsibility to do so. NNSA officials also noted that helium-3  stewardship was not part of NNSA’s mission of managing the nation’s  nuclear weapons. Without such stewardship responsibility, NNSA and  Isotope Program officials did not communicate about the helium-3  inventory or its rate of extraction.
The Isotope Program’s management of helium-3 sales was hampered by  this lack of communication regarding the size of the helium-3 inventory  and the rate at which helium-3 is extracted from tritium. Prior to selling  helium-3 at public auction, officials from the Isotope Program and NNSA  communicated with each other regarding how much helium-3 would be  available to sell that year and the minimum price for which it would be  sold at auction. However, Isotope Program and NNSA officials did not  discuss the size of the helium-3 inventory, how much was being added to  the inventory each year, or how quickly the inventory was being depleted.  Additionally, NNSA officials did not inform Isotope Program officials  when they transferred more than 34,000 liters of helium-3 in August 2008  to DOE’s Spallation Neutron Source, a physics research facility at the Oak  Ridge National Laboratory that uses helium-3 in large-scale neutron  detectors. This transfer—more than what the Isotope Program sold per  year, on average from 2003 to 2009—greatly reduced the helium-3  inventory, but NNSA officials did not inform Isotope Program officials  about it until after the transfer was completed. Despite the helium-3  inventory being greatly reduced, in September 2008 the Isotope Program  and NNSA renewed their MOU to continue selling helium-3 for an  additional 5 years without discussing the size of the helium-3 inventory or  the rate at which sales and large transfers—such as the one to DOE’s  Spallation Neutron Source—were reducing the inventory.
Helium-3 inventory and production information was not shared between  officials at the Isotope Program and NNSA because, according to NNSA  officials, this information was generally treated as classified by NNSA out  of concern that the inventory and annual extraction rate could be used to  calculate the size of the U.S. tritium stockpile, which is classified. In  describing the situation, Isotope Program officials stated that they did not  have the requisite “need to know” to gain access to this information, and  consequently, did not discuss it. In other words, Isotope Program officials  did not believe that they needed complete information on the size of the  helium-3 inventory or how much was being added to the inventory each  year in order to carry out the program’s mission because helium-3 does  not fall within its mission. One of the standards for internal control in the  federal government—information and communications—states that  information should be recorded and communicated to management and  others within an entity in a form and within a time frame that enables them  to carry out their responsibilities. The lack of communication between  NNSA and Isotope Program officials was not consistent with this standard.  Isotope Program and NNSA officials told us that this lack of  communication contributed to the government’s delayed response to the  helium-3 shortage. NNSA officials acknowledged the ambiguity about what  information can be communicated about the helium-3 inventory and, in  January 2010, issued a memorandum to clarify and broaden what  information about helium-3 can be shared publicly. As a result, NNSA now  reports that 8,000 to 10,000 liters of helium-3 will be made available per  year.
section_title: Without Stewardship Responsibility, Key Risks to Managing Helium-3 Were Not Identified or Mitigated
paragraphs: Senior Isotope Program officials said that they did not identify and  mitigate key risks to managing helium-3 sales because, unlike most  isotopes that the program sells, officials do not consider stewardship of  helium-3 to be part of the program’s mission. Specifically, these Isotope  Program officials did not consider their lack of understanding of the  helium-3 inventory or the demand for helium-3 as risks to managing  helium-3 sales. According to these officials, for those isotopes that are  included in its mission—the isotopes that it produces—the Isotope  Program developed strategic planning documents and generally updated  these documents on an annual basis. We reviewed the Isotope Program’s  strategic planning documents and found examples where the program  assessed risks to isotopes that it produces and sells. The Isotope Program,  however, did not perform strategic planning for helium-3, including  assessing risks, because program officials do not consider stewardship of  helium-3 to be part of the program’s mission. For those isotopes that the  Isotope Program sells but whose supply it does not control, such as  helium-3, Isotope Program officials told us that they see their role as a  conduit that sells these isotopes to customers as a courtesy. There are 17  isotopes, including helium-3, that the program sells but, according to  program officials, does not have stewardship responsibility for because  the Isotope Program does not control their supply. For example, lithium-6,  which is used in neutron detection applications and battery research, is  sold by the Isotope Program, but its supply is controlled by NNSA.
Although program officials do not consider helium-3 to be part of the  program’s mission, it nonetheless collected information in order to  forecast demand. To do this, the Isotope Program recorded the number of  telephone inquiries from potential customers and the volume of helium-3  discussed. Because it does not view helium-3 as a part of its mission,  program officials said that the Isotope Program did not take proactive  steps to solicit information to better understand future demand. For  example, according to representatives, the Isotope Program did not solicit  information from Linde, the company that had purchased or purified  nearly all the helium-3 in the United States, which gave Linde a more  complete understanding of the historical and future demand for helium-3.  In tracking telephone inquiries, the Isotope Program’s records show that it  received nine telephone calls in 2008 from customers who were interested  in acquiring 1,226 liters of helium-3. In contrast, according to Linde  documentation, based on its actual use, the demand for helium-3 in 2008  was nearly 60,000 liters. Linde representatives also noted that the Isotope  Program did not seek demand-related information from Linde until after  the shortage was realized.
Isotope Program officials told us that forecasting the demand for isotopes  is very difficult because demand for isotopes can quickly change. Because  of its effect on isotope inventories, changing demand is a risk to the  program’s management of the sale of all isotopes. One of the federal  standards for internal control—risk assessment—states that management  should assess the risks faced entity-wide, and at the activity level, from  both external and internal sources, and that once risks have been  identified, management should decide what actions should be taken to  mitigate them. Risk identification methods may include, among other  things, forecasting and strategic planning, and consideration of findings  from audits and other assessments. A DOE advisory committee has also  noted the importance of understanding demand for isotopes. In August  2008, DOE tasked its Nuclear Science Advisory Committee with  establishing a standing subcommittee to research the needs and  challenges of the Isotope Program and make recommendations to address  them. According to the subcommittee report, for the Isotope Program to  be efficient and effective, it is essential that it accurately forecasts the  demand for isotopes. The report noted that the “ability of the program to  predict demand for certain isotopes needs vast improvement.” It went on  to recommend that the program “maintain a continuous dialogue with all  interested federal agencies and commercial isotope customers to forecast  and match realistic isotope demand and achievable production  capabilities.”
Isotope Program officials told us that they are considering convening a  workshop, possibly in the summer of 2011, with federal agency  stakeholders to discuss supply and demand of all isotopes that are  produced or sold by the Isotope Program. According to the Director of the  Facilities and Project Management Division, which manages the Isotope  Program, while the program does not consider this role a part of its  mission, it is volunteering to convene this workshop to be helpful to the  isotope user community.
section_title: The Federal Government’s Three Priorities for Allocating the Limited Supply of Helium-3 Exclude Domestic Radiation Detection Portal Monitors
paragraphs: In July 2009, the National Security Staff, under the National Security  Advisor, established an interagency policy committee consisting of  officials from DOD, DOE, DHS, the Department of Commerce, and the  Department of State to address the helium-3 shortage. In doing so, the  policy committee established the following three priorities for allocating  the limited supply of helium-3:    Priority 1: Applications for which there are no alternatives to helium-3,  which includes, for example, research that requires ultra-low temperatures  that can be achieved only with helium-3.
Priority 2: Programs for detecting nuclear material at foreign ports and  borders, which includes, for example, NNSA’s Second Line of Defense  program that deploys radiation detection portal monitors at key overseas  ports and border crossings.
Priority 3: Programs for which substantial costs have already been  incurred, such as DOE’s Spallation Neutron Source research facility that  conducts physics research.
Furthermore, the committee eliminated further allocations of helium-3 for  domestic radiation detection portal monitors beginning in fiscal year 2010  because, according to committee documents, it determined there are  alternatives to using helium-3 to detect neutrons in these portal monitors.  The policy committee also determined that it will not support allocating  helium-3 for any new applications that would increase the demand for  helium-3.
Following this approach, the policy committee has allocated helium-3 to  federal agency and commercial customers from 2009 through 2011, as  shown in table 2. These allocations have brought the supply and demand  of helium-3 into closer balance and mark a significant decrease from the  amount the Isotope Program previously sold or transferred from 2003  through 2009—an average of about 30,000 liters per year.
The policy committee developed a process for customers to request  allocations of helium-3 using “champions,” which are agency officials who  represent the federal agencies for which they work and its grantees; a  champion is appointed by the Isotope Program for nonfederal customers,  such as the oil and gas industry. The champion for a specific category of  customer gathers all the helium-3 requests and determines whether the  requests are consistent with the policy for allocating helium-3. If so, the  champion submits the requests to the policy committee. The policy  committee weighs the requests against the helium-3 priorities and the  amount of helium-3 that is available to make allocation decisions. After  allocation decisions are made, customers are notified and, if they received  an allotment, they must submit a request for the helium-3 to Linde, which  is contracted by the Isotope Program to purify and distribute the helium-3  allocations. When Linde receives a request for helium-3, according to  Linde representatives, they verify the customer’s allocation with the  appropriate champion. Once verification is received, Linde ships the  allotted amount of helium-3 to the customer. This allocation and receipt  process is the same for all customers—federal agencies, researchers, and  private companies, as shown in figure 1.
The helium-3 champions or the policy committee may reject a request for  helium-3, as shown in figure 1. If rejected, customers may resubmit a  request the following year. According to seven of the agency champions,  customers are aware of the policy committee’s priorities and have usually  reduced the amount of their request to the absolute minimum amount of  helium-3 that is needed. As a result, the committee has approved most  requests.
When determining the annual allocations for helium-3, the policy  committee also recommends to the Isotope Program a price at which  helium-3 should be sold to different customers—including the federal,  medical, and commercial entities. When the policy committee first began  to allocate helium-3 in 2009, the Isotope Program, in consultation with the  policy committee, established two different prices—one for medical  applications and the other for all other applications. For use in the  manufacture of drugs, medical devices, and other products, the Food and  Drug Administration requires that helium-3 must be certified to meet  specific requirements, called current good manufacturing practices  (cGMP). In 2009, the price for cGMP helium-3 was $600 per liter; helium-3  for all other applications was priced at $450 per liter. Certifying helium-3  under cGMP requirements is more expensive, according to Linde  representatives, because of the extra certification and purity testing that is  required. This practice was continued for allocations in 2010. In 2011,  however, the Isotope Program divided the price for helium-3 to be used for  non-cGMP applications into two categories: one for federal agencies and  their grantees and one for commercial and nonfederal agencies. Table 3  shows the different prices for helium-3, per liter, beginning with 2009.
section_title: Key Federal Agencies Are Collaborating to Increase the Helium-3 Supply and Develop Alternatives
paragraphs: DOE and NNSA are taking actions to increase the supply of helium-3 by,  among other things, pursuing other sources and recycling helium-3 from  retired equipment. Specifically, NNSA officials said that NNSA is in  discussions with Ontario Power Generation (OPG) to determine the  feasibility of obtaining helium-3 from OPG’s stores of tritium. OPG has  accumulated this tritium as a by-product of producing electricity using  heavy-water nuclear reactors. According to OPG officials, it owns 16  heavy-water nuclear reactors that are currently operating that have  produced enough tritium to initially yield approximately 100,000 liters of  helium-3. According to NNSA officials, once this initial amount is  recovered, OPG estimates that its stores of tritium may yield about 10,000  liters of helium-3 annually. Combined with NNSA’s current annual  production of helium-3, obtaining helium-3 from OPG could boost the  United States’ supply to about 18,000 to 20,000 liters per year. In addition,  DHS and DOE have expressed interest in exploring the option of  extracting helium-3 from natural helium, or helium-4. Helium-3 is found in  small quantities in natural helium and could possibly be extracted from the  nation’s helium reserve near Amarillo, Texas, that is managed by the  Department of the Interior’s Bureau of Land Management. The Bureau of  Land Management estimates that approximately 125,000 liters of helium-3  may be present in the helium reserve, which could be extracted over the  next 10 years. DOE officials estimate that a similar reserve of natural  helium in Wyoming could yield another 200,000 liters of helium-3 that  could be extracted over the life of the reserve. DHS officials note,  however, that a feasibility study is needed to determine whether it would  be cost-effective to extract helium-3 from natural helium.
Federal agencies and private sector companies have started to recycle  helium-3 from unused equipment in order to boost the supply. For  example, an analysis conducted by DOE shows that it can extract helium-3  from retired tritium storage beds at its tritium extraction facility at the  Savannah River Site. DOE estimates that it could extract 8,000 to 10,000  liters from these storage beds every 8 to 10 years, beginning as early as  2012. Additionally, DOE surveyed its national laboratories and identified  over 1,500 liters of helium-3 in unused equipment and storage cylinders  that could be reused immediately. DHS has also identified retired  equipment from which helium-3 can be extracted. Private companies have  also started to recycle helium-3 from decommissioned radiation detection  portal monitors. For example, according to a representative from a  helium-3 tube manufacturing company, the company is buying retired  radiation detection equipment to extract the helium-3.
In addition to increasing the supply of helium-3, federal agencies and  private companies are researching alternatives to helium-3 for several  applications in order to decrease demand. For example, the government is  conducting research to develop alternatives for neutron detection  applications, including radiation detection portal monitors and nuclear  physics research, which together use more helium-3 than any other  application. DHS, DOE, DOD, and NIST, for example, are supporting  approximately 30 different programs, some of which may result in  technologies available for use in radiation detectors that, according to  agency documents, could be ready by 2012. Similarly, DOE’s Spallation  Neutron Source research facility is coordinating with similar facilities  internationally—including those in Germany, Japan, Russia, and Sweden— to develop alternative technologies for large-scale physics research  applications. The private sector is also researching alternatives to helium-3  for radiation detection portal monitors and other applications, including  MRIs for the lungs. For example, equipment using the isotopes lithium-6  and boron-10 may be able to replace helium-3 in radiation detection portal  monitors, according to representatives from companies that are  developing them. Like helium-3, lithium-6 is produced by NNSA and sold  by the Isotope Program. According to one program official, this official  contacted NNSA to inquire about the inventory and production rate of  lithium-6 because of the potential for increased demand if lithium-6-related  technologies are chosen to replace helium-3 in radiation detection portal  monitors. NNSA officials told the Isotope Program official, however, that  such information is classified and cannot be shared, but assured the  official that NNSA has enough lithium-6 to meet any future increase in  demand. In March 2011, the Director of the Facilities and Project  Management Division, which manages the Isotope Program, said that,  although classified, program officials do have access to this information  through NNSA’s Office of Nuclear Materials Integration. DOE officials said  that they have evaluated the potential demand for lithium-6 and have taken  steps to ensure there is an adequate supply. According to its director, the  Office of Nuclear Materials Integration is responsible for, among other  things, coordinating management of certain isotopes produced by NNSA,  including tracking the inventory of these isotopes, and coordinating  communication within DOE and NNSA. The director stated that it is the  responsibility of the Isotope Program, however, to manage the activities  under its control for these isotopes, such as selling them outside DOE and  NNSA and conducting 5-year supply and demand forecasts. This raises  concerns that without stewardship responsibility for the overall  management of the supply and demand of lithium-6, or the other isotopes  produced by NNSA, neither the Isotope Program nor any other DOE or  NNSA entity may detect an imbalance, resulting in the shortage of another  isotope.
section_title: Conclusions
paragraphs: Facing a critical shortage of helium-3 since 2008, DOE and other federal  agencies are collaborating to bring supply and demand into balance, while  supporting essential applications for which there are no alternatives. This  shortage occurred because the demand for helium-3 rose sharply in  response to the increased deployment of radiation detection portal  monitors, in addition to the increased use of helium-3 in research and  other applications. The amount of helium-3 sold by the Isotope Program  quickly outpaced the annual production, and this imbalance went  undetected until the supply of helium-3 reached a critical shortage. The  overall federal awareness of and response to the helium-3 shortage was  delayed because no entity within DOE had stewardship responsibility for  coordinating the production and sale of helium-3. Furthermore, there was  a lack of communication between NNSA and Isotope Program officials  over the size of the helium-3 inventory, how much was added to the  inventory annually, and how quickly the Isotope Program’s sales were  depleting the inventory. While the Isotope Program’s mission is to manage  the production and sale of isotopes, including developing strategic plans  and assessing risks for these isotopes, it has not taken a similar  stewardship role in managing the 17 isotopes, including helium-3, whose  supply it does not control. A key risk to managing the sale of all these  isotopes is the lack of control over, and knowledge of, their supply. Under  the federal standards for internal control, federal managers are to assess  the risks faced entity-wide, and at the activity level, from external and  internal sources and decide what actions to take to mitigate such risks.  Because Isotope Program officials do not believe that they have a  stewardship role for helium-3, they did not take steps to mitigate the risk  of selling helium-3 without information on the size of the inventory or its  rate of replenishment. Similarly, without a stewardship role, the program  did not take sufficient steps to accurately forecast the increased demand  for helium-3. Such forecasting is important in order to align demand with  current inventory levels. In this regard, the subcommittee report of the  Nuclear Science Advisory Committee stated that for the Isotope Program  to be efficient and effective, it needs accurate forecasts for the demand for  isotopes. A lack of communication and failure to identify risks and  forecast demand ultimately delayed the Isotope Program’s awareness of,  and the federal government’s response to, the helium-3 shortage. In  conclusion, we believe that all isotopes without clear stewardship  responsibilities may face the same risks that led to the helium-3 shortage.
section_title: Recommendations for Executive Action
paragraphs: We are making four recommendations to the Secretary of Energy designed  to avoid future shortages associated with managing all isotopes that the  Isotope Program sells but whose supply it does not control, including  helium-3. First, we recommend that the Secretary of Energy clarify  whether the stewardship for all these isotopes belongs with the Isotope  Program or elsewhere within the Department of Energy. Once the  stewardship for these isotopes has been assigned, we further recommend  that the Secretary of Energy direct the head of the responsible office(s) to  take the following three actions:    develop and implement a communication process that provides complete  information to the assigned entity on the production and inventory of  isotopes that are produced outside the Isotope Program;   develop strategic plans that, among other things, systematically assess and  document risks to managing the isotopes and supporting activities, such as  not having control over the supply of these isotopes, and implement  actions needed to mitigate them; and   develop and implement a method for forecasting the demand of isotopes  that is more accurate than the one that is currently used. In this regard, the  actions taken should be consistent with the forecasting recommendation  from the subcommittee report of the Nuclear Science Advisory  Committee.
section_title: Agency Comments and Our Evaluation
paragraphs: We provided a draft of this report to the Secretaries of Energy and  Homeland Security for their review and comment. DHS had no comments  on the findings of the draft report or our recommendations. In a written  response for DOE, the National Nuclear Security Administration’s  Associate Administrator for Management and Budget stated that he  understands our recommendations and can implement them but took  exception to our characterization of the Isotope Program’s mission. In the  report, we state that the Isotope Program’s mission is to produce and sell  isotopes and related isotope services, maintain the infrastructure required  to do so, and conduct research and development on new and improved  isotope production and processing techniques, which was its mission from  2003 through 2008—the time during which the Isotope Program was  selling helium-3 by auction and the helium-3 shortage occurred. In its  response, NNSA explained that the Isotope Program has been working to  clarify its responsibilities for isotopes since 2009. In this regard, the DOE  fiscal year 2012 Congressional Budget request describes the Isotope  Program’s mission as that of producing and distributing isotopes that are  not commercially available and distributing other materials as a service to  DOE. However, according to NNSA’s comments, the Isotope Program does  not have the mission to be the steward of stockpiles of other materials and  their byproducts, including helium-3. Neither DOE’s fiscal year 2012  Congressional Budget request, nor NNSA’s comments explain what entity  does have stewardship responsibility for helium-3 and several other  isotopes that are sold by the Isotope Program, but produced elsewhere.  Regardless of how the Isotope Program defines its mission today, at the  most crucial time when helium-3 should have been carefully managed in  order to avoid the sudden awareness of the shortage, no one entity  believed it had the responsibility to do so. As a result, the shortage of an  isotope that is critical to national security, research, industrial, and  medical applications went undetected until the supply reached a critical  level. Our recommendations are intended to assist in avoiding such a  problem with helium-3 and other isotopes in the future.
DOE also provided technical comments that we incorporated as  appropriate throughout the report. DOE’s comments on our draft report  are included in appendix I.
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If you or your staffs have any questions about this report, please contact  Gene Aloise at (202) 512-3841 or aloisee@gao.gov or Timothy M. Persons  at (202) 512-6412 or personst@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 key contributions to this report are  listed in appendix II.
section_title: Appendix I: Comments from the Department of Energy
section_title: Appendix II: GAO Contacts and Staff Acknowledgments
subsections: section_title: GAO Contacts
section_title: Staff Acknowledgment
paragraphs: In addition to the contact named above, Ned H. Woodward, Assistant  Director; Eric Bachhuber; R. Scott Fletcher; and Wyatt R. Hundrup made  key contributions to this report. Kendall Childers, Nancy Crothers, Cindy  Gilbert, Jonathan Kucskar, and Mehrzad Nadji also made important  contributions.