What the U.S. General Accounting Office (GAO) Found
Federal agencies, including the U.S. Department of Energy (DOE) and the separately organized National Nuclear Security Administration (NNSA) within DOE, and uranium industry representatives have identified risks to the commercial supply chain for uranium needed for defense purposes. Such uranium may need to be mined domestically and enriched using U.S. technology to be free of obligations for the peaceful use of uranium and certain technology imported under international agreements. Identified risks to the unobligated uranium supply chain include:
1) possible loss of domestic uranium mining capabilities, and
2) possible challenges in re-starting the only facility in the United States for converting natural uranium into a form suitable for use in enrichment operations.
Further, the U.S. has not had an operating enrichment capability that uses U.S. technology since 2013.
DOE and NNSA have initiated actions officials believe will mitigate such risks to the unobligated uranium supply chain. For example, DOE and NNSA have both taken steps to reestablish a domestic enrichment capability with U.S. technology. In addition, DOE has proposed creation of a domestic uranium reserve to help support the domestic uranium mining and conversion industries until market conditions improve. DOE’s fiscal year 2021 budget request includes $150 million for the reserve. However, we cannot conclude that the estimate is reasonable because it is unclear how the funding needs for the reserve were determined. By providing a more complete analysis to support future funding requests for the reserve, DOE could better provide assurance that such requests would achieve objectives.
The Nuclear Fuel Working Group’s strategy to mitigate risks to the domestic uranium industry does not fully incorporate all desirable characteristics GAO has identified for a national strategy. For example, it does not identify (1) the level of resources needed to support proposed actions or (2) an interagency coordinating mechanism. DOE is developing an implementation plan for the strategy, but DOE officials provided conflicting statements about the extent to which the agency will coordinate interagency implementation.
The GAO report concluded that since 2013 [and the end of the Megatons-to-Megawatts program with Russia], our nation has relied on a finite and diminishing inventory of unobligated uranium to meet national security and defense needs, including production of tritium for the nuclear weapons stockpile. NNSA is currently evaluating options for a future domestic enrichment capability. However, agency officials and nuclear industry representatives have raised concerns that other sectors of the unobligated uranium supply chain—such as the domestic uranium mining and uranium conversion sectors—may face significant long-term risks from foreign competition
and uncertainty over the demand for uranium.
The uranium reserve that DOE proposed in the fiscal year 2021 budget justification and that is addressed in the Nuclear Fuel Working Group’s strategy is intended to ensure a guaranteed near-term demand for uranium and help revitalize the domestic industry, allowing time for industry conditions to improve. However, it is unclear how the funding needs for the reserve were determined. As DOE moves forward with establishing the reserve, documenting the basis for its cost estimate could provide assurance that DOE’s funding requests to the Congress for the reserve are reasonable.
DOE and NNSA have taken separate steps to mitigate risks to the domestic enrichment sector, which is also vital in guaranteeing a long-term supply of unobligated uranium for defense purposes. However, these efforts are not fully coordinated. Regardless of whether NNSA’s AOA for domestic uranium enrichment results in selection of the large centrifuge option being developed by Centrus or the small centrifuge option being developed by Oak Ridge National Laboratory, NNSA will need to ensure that its AOA process was unbiased. Specifically, if NNSA selects the small centrifuge, different parts of DOE—NNSA and DOENE—would be separately funding different domestic enrichment capabilities, raising questions about whether this investment in multiple
suppliers was decided strategically. Alternatively, if NNSA selects the large centrifuge as its preferred option for meeting its future enrichment needs, there could be questions as to whether the DOE-NE support for the large centrifuge program influenced the outcome of the AOA process.
A thorough review of the AOA by NNSA’s independent Office of Cost Estimating and Program Evaluation, as required under an NNSA Business Operating Procedure, would instill credibility in the AOA process and ensure it is unbiased toward any solution.
Finally, the Nuclear Fuel Working Group strategy identified actions to support and revitalize the domestic nuclear industry, including some actions that may benefit the unobligated uranium supply chain. However, the strategy lacks certain elements and therefore does not meet or only partially meets the desirable characteristics of national strategies we have identified in previous work. As the lead agency for implementation of the strategy, DOE has an opportunity to address and clarify these missing elements in the implementation plan it is developing for the strategy. By doing so, DOE could improve implementation of the strategy, help ensure the strategy’s usefulness in resource and policy decisions, and better ensure accountability going forward.
[WNN comments on the GAO report: https://www.world-nuclear-news.org/Articles/GAO-recommends-improvements-to-US-uranium-strategy ]
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