A new federal audit says that nuclear officials “significantly underestimated” the costs of building an experimental nuclear facility in South Carolina, causing it to go nearly $3 billion over budget and challenging its very future.
When construction began on the Mixed Oxide Fuel Fabrication Facility (MOX) in 2007, its project baseline was $4.8 billion and its completion date was September 2016. But that had grown to $7.7 billion and a November 2019 completion date just five years later.
When finished, the MOX facility at the Savannah River Site would convert weapons-grade plutonium into commercial nuclear reactor fuel. The United States has previously agreed to dispose of the plutonium as part of a nonproliferation treaty with Russia. However, the project’s future is extremely uncertain as its costs escalate.
The report released by the Energy Department’s inspector general last week blames bad forecasts, underestimated construction costs, and high personnel turnover for the project’s ballooning budget. The report also notes that the National Nuclear Security Administration (NNSA) added additional work to the project than originally contracted. The Associated Press first reported on the report’s findings Tuesday.
The report states the NNSA baseline cost was established before design work was 90 percent complete, as the agency’s standards now require. As a result, “the level of effort needed to install equipment was higher than anticipated, staff turnover was greater than expected, and subcontractors experienced problems meeting nuclear quality assurance requirements,” the inspector general noted.
The White House’s Fiscal Year 2015 budget proposal calls for the NNSA to place the MOX Project on cold standby while it looks into other possible ways to dispose of the plutonium. South Carolina lawmakers worry the standby could become permanent, costing roughly 1,800 jobs and ending construction that is 60 percent complete. State officials sued the Energy Department in March, but agreed to drop the suit after the agency pledged to continue fully funding the project through September 30.
The inspector general recommended that the NNSA recalculate the MOX Project’s costs once it finishes the review, but believes funding will remain an issue.
“Considering the problems experienced by NNSA and (the project’s contractor) in controlling cost and schedule to date, we remain concerned as to whether the estimated cost and completion date for the MOX Facility… are achievable,” the report notes.