Politics & Policy

A Botched Plan to Turn Nuclear Warheads Into Fuel


A Botched Plan to Turn Nuclear Warheads Into Fuel

Photo illustration by 731; Photographs by Alamy (2); Corbis; Getty Images

As the Soviet Union was unraveling and the Cold War was winding down in the early 1990s, negotiators in Washington and Moscow began talking about how best to dispose of the plutonium inside thousands of nuclear warheads the two nations had agreed to dismantle. The cheapest and easiest method was to immobilize the radioactive material by encasing it in molten glass and burying it. But the Russians balked at that, likening it to flushing gold down the toilet. Ultimately, it was decided that the plutonium would be converted into fuel for nuclear power plants. In September 2000, the U.S. and Russia signed an agreement under which each side would turn 34 tons of weapons-grade plutonium into mixed-oxide fuel, or MOX, that could be combined with uranium for use in commercial reactors.

In the U.S., that huge task would take place at an aging plutonium factory in South Carolina called the Savannah River Site. From the 1950s to the 1980s, the 310-square-mile facility had churned out about 36 tons of weapons-grade plutonium for nuclear warheads. Now, the plant would turn those same warheads into fuel rods. The Department of Energy initially estimated it would cost about $1 billion to convert the plant. Construction began in August 2007, with an expected completion date of 2016.

The U.S. government even had a ready customer for the rods. Charlotte-based Duke Energy (DUK), one of the largest nuclear power companies in the U.S., signed on as a buyer. From 2005 to 2008, the company ran tests of MOX fuel the Department of Energy got from France. The fuel worked fine. Everything was going according to plan.

Almost seven years after construction began, the MOX plant is now 60 percent built. But it’s looking increasingly likely that it won’t ever be completed. Though the government has successfully converted weapons-grade uranium into nuclear fuel for commercial reactors, doing the same with plutonium is proving to be much more complicated. The MOX plant in South Carolina requires 85 miles of pipe, 23,000 instruments, and 3.6 million linear feet of power cables.

The project is vastly over budget: The Department of Energy has sunk about $5 billion into it so far and estimates it will cost an additional $6 billion to $7 billion to finish the plant, plus an additional $20 billion or so to turn the plutonium into fuel over 15 years. In its 2015 budget request released in March, the Department of Energy announced it will place the MOX project on “cold standby,” effectively mothballing the project for the foreseeable future. “It’s a major fiasco,” says Edwin Lyman, a senior scientist at the Union of Concerned Scientists. “Billions of taxpayer dollars have been wasted. It’s a classic boondoggle.”

The MOX plant is the latest blunder for the Department of Energy, which has a reputation for mismanaging big, complicated projects, particularly those related to nuclear energy. Costs for a nuclear waste treatment plant in Washington State have nearly tripled to $13 billion. A uranium processing facility in Tennessee once estimated to cost around $1 billion is now tipping the scales at around $11 billion, according to an Army Corps of Engineers study. It’s also running about 20 years behind schedule. A Department of Energy spokesman declined to comment for this article.

In a February report on cost overruns at the MOX plant, the Government Accountability Office laid out a number of missteps on the part of the National Nuclear Security Administration, the arm of Energy that’s overseeing the project. The GAO reported that construction began when the architectural plans were only 58 percent complete. That meant the contractor, Shaw Areva MOX Services, a U.S.-based joint venture with European parent companies, wound up having to make changes once the final design was approved that cost time and money.

The GAO report said that the National Nuclear Security Administration hadn’t figured out exactly what caused construction costs to swell. It’s on the GAO’s list of agencies whose major projects are at “high risk” of fraud, waste, and mismanagement. “Everything they touch turns out to take longer and cost more,” says David Blee, executive director of the U.S. Nuclear Infrastructure Council, a Washington think tank.

Construction snafus weren’t the only problem. In late 2008, not long after construction got under way, Duke Energy pulled out of the program because the government couldn’t guarantee a steady supply of the plutonium mixture. The price of uranium, the most common nuclear fuel, has since fallen by about 70 percent, giving other utilities even less incentive to buy the costlier MOX. “U.S. utilities weren’t wild about using MOX fuel to begin with,” Sharon Squassoni, director of the nuclear proliferation prevention program at the Center for Strategic and International Studies, said in an e-mail. “It is an exceedingly expensive way to dispose of plutonium.”

The DOE must now figure out what to do with all that plutonium. Energy Secretary Ernest Moniz has told Congress that the agency is reviewing four alternatives to the MOX program. He declined to specify what they are, though he’s said that some would require going back to the table with Russia to renegotiate the 2000 agreement. Russia has already shipped its first batches of repurposed plutonium fuel to a reactor in Zarechny, according to World Nuclear News.

Republican Senator Lindsey Graham of South Carolina, one of the MOX plant’s strongest advocates, has criticized Energy for giving up on the project. “This committee told you to build the MOX program,” Graham told Moniz during an April 9 hearing. “We didn’t tell you to study some other alternative.” There are now 13 tons of weapons-grade plutonium sitting at the Savannah River Site. According to a law that Graham helped write in 2002, if the MOX plant doesn’t start processing a ton of plutonium a year by 2016, the Department of Energy has to begin removing it from South Carolina or pay the state up to $100 million in penalties annually for up to five years. State Attorney General Alan Wilson is suing the administration to keep the construction going. “It’s a clear violation of the law and a blatant disregard for the will of Congress,” says Wilson. The DOE has until May to respond to the suit. While the political battle plays out, 1,800 workers remain on the job, building a factory the administration doesn’t want to finish, to make fuel the energy industry doesn’t want to buy.

The bottom line: The Department of Energy wants to mothball a nuclear fuel plant that’s projected to be at least $6 billion over budget.

Philips_190
Philips is an associate editor for Bloomberg Businessweek in Washington. Follow him on Twitter @matthewaphilips.

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