Nuclear Weapons: Technology Development Efforts for the Uranium Processing Facility
Released: 2014-04-18T00:00:00

Letter

Background

In 1990, we first designated DOE program and contract management as an area at high risk of fraud, waste, abuse, and mismanagement. In January 2009, to recognize the progress made at DOE’s Office of Science, we narrowed the focus of the high-risk designation to two DOE program elements, NNSA and the Office of Environmental Management. In February 2013, our most recent high-risk update, we narrowed this focus to major projects (i.e., projects over $750 million) at NNSA and the Office of Environmental Management. DOE has taken some steps to address our concerns, including developing an order in 2010 (Order 413.3B) that defines DOE’s project management principles and process for executing a capital asset construction project, which can include building or demolishing facilities or constructing remediation systems.NNSA is required by DOE to manage the UPF construction project in accordance with this order. The project management process defined in Order 413.3B requires DOE projects to go through five management reviews and approvals, called “critical decisions” (CD), as they move forward from project planning and design to construction to operation. The CDs are as follows:

CD 0: Approve a mission-related need.

CD 1: Approve an approach to meet a mission need and a preliminary cost estimate.

CD 2: Approve the project’s cost, schedule and scope targets.

CD 3: Approve the start of construction.

CD 4: Approve the start of operations.

In August 2007, the Deputy Secretary of Energy originally approved CD 1 for the UPF with a cost range of $1.4 to $3.5 billion. In June 2012, the Deputy Secretary of Energy reaffirmed CD 1 for the UPF with a cost range of $4.2 to $6.5 billion and approved a phased approach to the project, which deferred significant portions of the facility’s original scope. According to NNSA documents, this deferral was due, in part, to the project’s multibillion dollar increased cost estimate and to accelerate the completion of the highest priority scope. In July 2013, NNSA decided to Table 1 shows the combine CD 2 and CD 3 for the first phase of UPF.UPF’s phases, scope of work, cost estimate, as of June 2012, and proposed start of operations.

However, the future status of the UPF project and the process by which enriched uranium operations at the Y-12 plant will be modernized are unclear. NNSA has recently decided to: (1) delay later UPF phases, (2) assess options other than the UPF for enriched uranium operations at the Y-12 plant, (3) change a key technological requirement for the UPF, and (4) develop a strategy for how NNSA will maintain the Y-12 plant’s uranium capabilities into the future. Specifically:

NNSA is delaying UPF Phase II and Phase III a minimum of 2 years. In a December 2013 testimony before the Defense Nuclear Facilities Safety Board, the NNSA Acting Administrator said that the agency does not expect to move out the facilities that house machining operations (Building 9215) as well as assembly and dismantlement operations (Building 9204-2E) until 2038 due primarily to budget constraints. NNSA previously estimated that these capabilities would be operational in the UPF no later than 2036.

NNSA is currently evaluating alternatives to the UPF. In early January 2014, NNSA began to consider options other than the UPF for enriched uranium operations at the Y-12 plant because, according to the UPF Federal Project Director, the project is facing budget constraints, rising costs, and competition from other high-priority projects within NNSA—such as the planned B61 bomb and W78/88 warhead nuclear weapon life extension projects. NNSA has initiated a formal analysis of UPF alternatives—an analytical comparison of the operational effectiveness, costs, and suitability of proposed solutions to address a mission need. According to the UPF Federal Project Director, the analysis of alternatives, which is scheduled to be completed by April 15, 2014, will include a potential solution for replacing only uranium purification and casting capabilities (Building 9212) by July 2025 at a cost that does not exceed $6.5 billion. According to the NNSA Acting Administrator, NNSA does not plan to continue full operations in Building 9212, which has been operational for over 60 years, past 2025 because the building does not meet modern safety standards, and increasing equipment failure rates present challenges to meeting required production targets. While NNSA is undertaking the analysis of alternatives, the UPF project team is currently (1) delaying the start of approximately $300 million in site preparation and long lead procurement activities and (2) will no longer complete engineering work to have the UPF’s design reach the 90 percent complete milestone by August 2014, as previously planned.

NNSA is currently evaluating alternatives for a key uranium purification technology originally planned for UPF Phase I, which now may be part of UPF Phase II. In late January 2014, NNSA decided to consider alternatives from its baseline uranium purification technology—which was to be part of UPF Phase I scope and had been under development since 2005—to a new technology, according to the UPF Federal Project Director. NNSA believes the new technology will require less space in the UPF and be more efficient to operate. In early February 2014, NNSA directed the UPF contractor to suspend design efforts in two UPF processing areas impacted by the potential technology change. Furthermore, NNSA is now considering installing this new technology as part of UPF Phase II scope, pending the results of further analysis.

NNSA is currently developing a Uranium Infrastructure Strategy for the Y-12 plant. In early February 2014, the NNSA Deputy Administrator for Defense Programs directed his staff to develop a Uranium Infrastructure Strategy, which establishes the framework of how NNSA will maintain the Y-12 plant’s uranium mission capabilities into the future. Key aspects that are to be considered during the strategy’s development include, among other things: (1) an evaluation of the uranium purification capabilities and the throughput needed to support requirements for life extension programs and nuclear fuel for the U.S. Navy; (2) an evaluation of the alternatives to the UPF that prioritizes replacement capabilities by risk to nuclear safety, security, and mission continuity; (3) an identification of existing infrastructure as a bridging strategy until replacement capability is available in new infrastructure. A draft of the strategy is due to the Deputy Administrator by early April 2014.

To assess the maturity of new technologies, DOE and NNSA adopted the use of Technology Readiness Levels (TRL). DOE took this action in response to our March 2007 report that recommended that DOE develop a consistent approach to assess the extent to which new technologies have been demonstrated to work as intended in a project before starting construction.which is the least mature; through TRL 4, in which the technology is validated in a laboratory environment; to TRL 9—the highest maturity level, where the technology as a total system is fully developed, integrated, and functioning successfully in project operations.

As shown in table 2, TRLs start with TRL 1, we found that DOE’s TRL guidance was not always consistent with best practices followed by other federal agencies, as well as with our prior recommendations. Specifically, DOE’s TRL guidance recommended that new technologies reach TRL 6—the level where a prototype is demonstrated in a relevant or simulated environment and partially integrated into the system—at the start of construction (CD 3). However, best practices followed by other federal agencies and our prior recommendations state that new technologies should reach TRL 7— the level where a prototype is demonstrated in an operational environment, has been integrated with other key supporting subsystems, and is expected to have only minor design changes—at the start of construction. In our November 2010 report, we recommended that the Secretary of Energy evaluate where DOE’s guidance for gauging the maturity of new technologies is inconsistent with best practices and, as appropriate, revise the guidance to be consistent with federal agency best practices. In September 2011, DOE issued its revised TRL guidance, but the guidance does not incorporate federal agency best practices and is not fully responsive to our recommendation. Specifically, DOE’s revised TRL guidance continues to recommend that new technologies reach TRL 6 at the start of construction, while stating that reaching TRL 7 at the start of construction is a recognized best practice.

In November 2010, we reported that NNSA was developing 10 advanced uranium processing and nuclear weapon components production technologies for the UPF. Since that time, NNSA eliminated 1 technology as the agency removed certain operations from the UPF. In April 2013, NNSA chartered an independent peer review team to examine various aspects of the UPF project, including assessing the current TRLs for new technologies. In an August 2013 report, the independent peer review team found that 6 of the 9 new technologies were not as mature as previously reported in the UPF contractor’s May 2013 TRL assessment; the independent peer review report also stated that no fundamental technology show stoppers were identified. In addition, the independent peer review report contained multiple technology development related findings and recommendations, and NNSA and the UPF contractor developed a corrective action plan to address them. Table 3 provides a description of the new technologies, the phase in which each technology will be deployed, and the TRL assessment concluded by the UPF contractor in May 2013 and the UPF independent peer review in August 2013.

New Technologies Planned for the UPF Face Five Additional Risks

Since our November 2010 report, we identified five additional risks associated with using new technologies in the UPF. Specifically: Integration risks for microwave casting technology. The August 2013 independent peer review team report raised concerns with microwave casting—a process that uses microwave energy to melt and cast uranium metal into various shapes—as it is planned to be integrated in the UPF’s casting system.official, the casting system planned for the UPF will employ uranium processing technology, equipment, and steps that are substantially different than the casting system currently used at the Y-12 plant. For example, microwave casting in the UPF will use glovebox enclosures—a containment system of secured gloves attached to a box that allows workers to process nuclear material inside the box without risk of contamination. The independent review team found that the UPF’s planned casting glovebox enclosures are: (1) large and somewhat complex, (2) have not had their functionality tested, and (3) have not been demonstrated with microwave casting. As such, the independent review team concluded that microwave casting has not been demonstrated in a relevant environment—a key requirement to reach TRL 6.

Technology development risk for special casting technology. In 2012, the UPF project team determined that a different nuclear safety control was needed for special casting—a custom process for casting uranium metal into various shapes—as this process uses more uranium than the regular casting process. For special casting, the UPF contractor is developing a nuclear safety control called “entombment.” The entombment control—which uses multiple parts, such as cylinders and an insulation material—would occupy void volume where molten uranium metal could otherwise collect in the event of an improper casting (i.e., mis-pour). However, a key insulation material planned for use in the entombment control failed an important series of performance tests in fiscal year 2013. According to UPF contractor representatives, this failure and the need to identify and test an alternative insulation material is now the project’s most significant technology development risk and the primary reason why the special casting technology is currently assessed to be at TRL 3.

Transition risks if NNSA switches to a new uranium purification technology. In 2005, NNSA decided to deploy the saltless direct oxide reduction technology—a process that converts uranium dioxide into a useable metal form—into the UPF. The August 2013 UPF independent peer review report concluded that an alternate technology called direct electrolytic reduction and electrolytic refining (DER/ER; currently assessed to be at TRL 3 and 4, respectively) could potentially reduce the UPF’s operating costs and produce less radioactive waste compared with the saltless direct oxide reduction technology. In a December 2013 testimony before the Defense Nuclear Facilities Safety Board, the Acting NNSA Administrator stated that early research and development investments in the DER/ER technology are promising and NNSA is actively seeking to mature and deploy the technology into UPF to minimize future waste streams. NNSA is now considering installing this new technology as part of UPF Phase II scope, pending the results of further analysis, and directed the UPF contractor in February 2014 to suspend design efforts in two UPF processing areas impacted by this potential technology change.

UPF contractor representatives told us that incorporating DER/ER into the UPF would require significant changes to the facility’s design. For example, NNSA officials said that changing to DER/ER would require a complete redesign of the processing areas and their equipment and may require adding new support utilities and that the UPF facility would have to revise its nuclear safety analysis. In addition, the August 2013 UPF independent peer review report found that the UPF project team has not conducted any nuclear criticality studies or developed any nuclear safety controls for the DER/ER technology because the technology was not planned for use in UPF at the time.

Assurance risks that the agile machining technology will work as intended before making key project decisions. As stated earlier, NNSA plans to approve a combined CD 2 (approved cost, schedule, and scope targets) and CD 3 (approve start of construction) milestone in for UPF Phase I, which includes the building exterior, all UPF processing areas, and all UPF support systems. In short, UPF Phase I will create key parameters that subsequent UPF phases must work within. Agile machining—a system combining multiple machining operations into a single process that fabricates metal into various shapes—is the key technology planned for UPF Phase II. The August 2013 independent UPF peer review assessed agile machining to be at TRL 4. In December 2013, NNSA decided to no longer fund agile machining technology development efforts because (1) agile machining is not considered a baseline technology for UPF Phase I as it is part of the deferred scope and (2) NNSA is considering combining agile machining development efforts with other machining development efforts used in at the Y-12 plant. According to NNSA officials, the UPF contractor has completed the design for the agile machining prototype, but it will be the responsibility of the UPF Phase II project to mature this technology.

GAO-07-336. which requires the successful deployment of all new technologies planned for the UPF, including those scheduled for UPF Phase II.

Risk that funding mechanism for UPF technology development activities may not be adequate to develop all new technologies. According to NNSA officials and UPF contractor representatives, NNSA has primarily funded UPF technology development activities from the Y-12 plant-directed research and development (PDRD) program, which requires projects from every part of the Y-12 plant to compete for funding. From fiscal year 2005 to fiscal year 2013, the $73 million in UPF technology development costs have been funded by non-UPF project sources, such as the PDRD program, instead of from the $1 billion specifically allotted to the UPF project, according to the UPF contractor Project Manager. UPF contractor representatives told us that NNSA made the decision to fund technology development activities from non-UPF project sources because some UPF technologies could be used for other operations at the Y-12 plant or at other nuclear weapon stockpile programs. However, NNSA did not select some UPF technology development projects identified as being priority by the UPF project team for PDRD funding. For example, in fiscal year 2013, 19 projects were considered priority by the UPF project team, but NNSA did not fund 3 of these projects. For fiscal year 2014, 19 projects were considered priority by the UPF project team, but NNSA did not fund 7 of these projects. In addition, one of the five UPF technology development risk reduction plans developed by the UPF contractor is to “obtain additional PDRD funding,” but the effectiveness of this plan is unclear given that existing UPF technology development projects considered priority have not received funding.

NNSA Is Taking Some Actions to Address Identified Risks

NNSA is currently taking some actions to address three of the five UPF technology risks we have identified. NNSA is currently developing plans and making programmatic decisions about the UPF that could address the other two risks but, it is still too soon to determine if these actions will sufficiently address these two risks. Specifically:

Microwave casting technology. To address the risks with integrating microwave casting—a process that uses microwave energy to melt and cast uranium metal into various shapes—into the UPF’s casting system, the UPF contractor plans to issue a request for proposal in March 2014 for the development of a prototype microwave casting furnace. UPF contractor representatives said that they have had preliminary discussions with two vendors about building the prototype. According to NNSA officials, the UPF contractor will be required to test the prototype in an integrated UPF configuration that includes glovebox enclosures. If completed, we believe these planned actions will help NNSA reduce this risk and identify further mitigation measures that may need to be taken.

Special casting technology. For the entombment nuclear criticality safety control planned for special casting—a custom process for casting uranium metal into various shapes—UPF contractor representatives told us that they would like to have a replacement insulation material identified and successfully tested by June 2014. However, NNSA officials said that this June 2014 date is optimistic and may not be met. In addition, UPF contractor officials said they are currently conducting a formal analysis of alternatives for the entombment control. The UPF contractor expects to finish its analysis by the end of January 2014 and brief the results and potential impacts to senior NNSA management. If NNSA completes these planned actions, we believe that the agency may have taken appropriate actions to address this risk.

DER/ER technology. According to the UPF Federal Project Director, in February 2014, the NNSA Deputy Administrator for Defense Programs directed NNSA’s Production Office—the field office responsible for contractor oversight and management of the Y-12 plant—to: (1) create a technology development plan for DER/ER, (2) develop a preliminary cost estimate for DER/ER technology development, (3) identify existing facilities at the Y-12 plant where DER/ER could be deployed, and (4) use DER/ER in actual uranium operations no later than 2021.

However, as noted above, the design of the two UPF processing areas impacted by the potential switch to DER/ER has been suspended. According to the UPF Federal Project Director, these areas are considered part of UPF’s deferred scope which means that (1) the UPF will reserve space for DER/ER capabilities and ensure that all needed support utilities are available in the two processing areas and (2) it will be the responsibility for the UPF Phase II project team to install the DER/ER equipment into the UPF. Given the early stages of NNSA’s planning, we believe that it is too soon to determine if these actions will address this technology transition risk.

Agile machining technology. The UPF is to modernize and consolidate all enriched uranium operations at the Y-12 plant in three phases. Agile machining—a system that combines multiple machining operations for fabricating metal into various shapes into a single process—is the key technology planned for UPF Phase II. As stated above, NNSA decided in December 2013 to no longer fund agile machining technology development efforts (currently assessed at TRL 4) for multiple reasons. UPF contractor representatives told us that (1) they have completed the design of an agile machining prototype; (2) by the end of 2014, they will outline the actions needed to mature the technology to TRL 6; and (3) the UPF Phase II project team will have the responsibility to mature the technology.

NNSA is currently evaluating alternatives to the UPF, and the outcome of this evaluation may require different agency actions to address this risk. If NNSA decides to continue with a UPF that includes machining operations, the agency will need to take action to address a recommendation from the August 2013 UPF independent peer review team. Specifically, the peer review team recommended that the UPF project fabricate and test an agile machining prototype before starting construction on the UPF. According to the peer review team, implementing this recommendation is a high-priority action and will help ensure the confident integration of the agile machining technology into UPF at a later date. However, if NNSA decides to construct a facility with only uranium purification and casting capabilities—which do not include machining capabilities—the agency will have to develop alternate plans that detail how machining capabilities will be modernized and how the agile machining technology will be matured. It is too soon to determine if the Uranium Infrastructure Strategy that NNSA is currently developing and scheduled to issue in draft form in early April 2014 will address this issue. Given that NNSA is: (1) currently evaluating potential UPF alternatives; (2) currently developing its Uranium Infrastructure Strategy; and (3) planning to conduct machining operations in its current facility, until at least 2038, we believe it is too early to tell if NNSA is taking appropriate action to address this risk.

Technology development funding. The August 2013 UPF independent peer review report recommended that the UPF project fund more technology development activities from project funds instead of PDRD funds. In October 2013, the UPF contractor issued a corrective action plan to address the recommendations from the August 2013 UPF independent peer review. This corrective action plan: (1) lists planned and ongoing actions that the contractor and NNSA will take to address each recommendation, (2) provides an estimated date by which planned actions are to be completed, and (3) identifies which UPF contractor representative or NNSA official is responsible for completing the planned action. As part of this corrective action plan, the UPF Assistant Project Manager for Technology is responsible for determining which technology development activities should be funded directly with UPF project funds and is to prepare a cost estimate for those activities. The UPF Assistant Project Manager for Technology told us that he expects to complete the planned corrective action by the end of March 2014. Adding required technology development activities to the UPF’s cost estimate may increase the project’s cost estimate, but it may also improve the accuracy and comprehensiveness of the estimate. If NNSA completes these planned actions, we believe that the agency may have taken appropriate actions to address this risk.

Conclusions

Enriched uranium operations at the Y-12 plant play a vital role in the national security of the United States by producing critical components for the nuclear weapons stockpile and by supplying fuel for the Navy. There is a clear need for NNSA to replace the old, deteriorating, and high- maintenance facilities at the Y-12 plant. NNSA is currently reevaluating the UPF project and may decide to construct a facility that is smaller and contains only select enriched uranium processing capabilities. Whether NNSA continues with the UPF project or chooses to undertake a smaller project, the facility will likely cost billions of dollars, and its ability to meet critical national security needs will depend on the successful development and deployment of new technologies. It is encouraging that NNSA has taken some steps to manage the development of these technologies. However, as we have detailed in this and other reports, we are concerned that, nearly a decade after the project started, the UPF project continues to face key technology-related risks, including the potential transition risks associated with NNSA’s recent decision to consider alternatives to a new uranium purification technology. NNSA is in the process of making key programmatic decisions with the UPF and has some ongoing efforts that may address identified risks if fully and successfully implemented. We will continue to monitor NNSA’s progress in addressing these risks as part of our UPF critical decisions reviews as directed by the Fiscal Year 2013 National Defense Authorization Act.

In addition, NNSA has not taken action to address the two recommendations related to UPF technology development we made in our November 2010 report: (1) that NNSA ensure that new technologies reach the level of maturity called for by best practices prior to CDs being made on the UPF project and (2) that the agency report to Congress any decisions to approve cost and schedule performance baselines or to begin construction of UPF without first having ensured that project technologies are sufficiently mature. NNSA generally agreed with those recommendations, and we continue to believe that best practices followed by other federal agencies for managing technology development, particularly reaching TRL 7 at the start of construction, are important. By not fully incorporating these practices, NNSA may not be able to ensure that the UPF and its other projects can be completed on time and within budgets.

Agency Comments and Our Evaluation

We are not making any new recommendations in this report. We provided a draft of this report to NNSA for comment. In written comments (see Appendix I), the acting NNSA Administrator stated that NNSA’s existing TRL guidance, which encourages the achievement of TRL 7 prior to the start of construction (CD 3), provides adequate protection against the premature commitment of resources while giving projects flexibility to make decisions between seeking TRL 6 and TRL 7. In addition, the acting NNSA Administrator stated the agency is closely overseeing and managing UPF’s ongoing technology development efforts using on-site personnel and independent reviews to confirm reported progress while also keeping senior management informed of development efforts.

We continue to believe that DOE should fully adhere to best practices in its technology development activities. DOE’s guidance recognizes that achieving a TRL 7 at the start of construction is a best practice and DOE encourages—but does not require—projects to achieve this level of readiness. Achieving TRL 7—the level where a prototype is demonstrated in an operational environment, has been integrated with other key supporting subsystems, and is expected to only have minor design changes—does require more time, effort, and money than achieving TRL 6. However, TRL 7 is seen as a best practice because it provides greater assurance the new technologies will work as intended before making very significant resource investments in construction activities, which for the UPF will total billions of dollars. Notably, DOD follows best practices in this area and recommends projects reach TRL 7 before production and deployment, or the equivalent of beginning construction on a DOE project.

Regarding NNSA’s oversight of technology development efforts, it is clear that certain NNSA actions, such as the August 2013 UPF independent peer review, helped identify and respond to some technology development issues. However, since NNSA is currently considering alternatives to UPF and developing the Uranium Infrastructure Strategy for the Y-12 plant, it is too early to determine if the oversight and management actions cited by NNSA will be sufficient to fully address all the risks we identified.

NNSA also provided technical comments, which we incorporated as appropriate.

We are sending copies of this report to the appropriate congressional committees, the Secretary of Energy, the Administrator of NNSA, and other interested parties. In addition, the report is available at no charge on the GAO website at http://www.gao.gov.

If you or your staff members have any questions on matters discussed in this report, please contact me at (202) 512-3841 or trimbled@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 II.

Appendix I: Comments from the National Nuclear Security Administration

NNSA’s attachment provided technical comments which we incorporated as appropriate in the final report.

GAO Contact

David C. Trimble, (202) 512-3841 or trimbled@gao.gov.

Staff Acknowledgments

In addition to the individual named above, Jonathan Gill, Assistant Director; Patrick Bernard; Antoinette Capaccio; Will Horton; Katrina Pekar-Carpenter; Dr. Timothy Persons, and Ron Schwenn made key contributions to this report.