Kenneth Fletcher
RW Monitor
5/2/2014

As a contract that cedes management of the American Centrifuge Project from USEC to Oak Ridge National Laboratory began this week, Senate appropriators are questioning how the program will be funded. This week DOE and USEC’s bankruptcy court approved a $118 million subcontract between ORNL contractor UT-Battelle and USEC to monitor operations of the American Centrifuge machines. But the Department has not requested any funding for the program in FY’15. “As you go from the sudden bankruptcy of the USEC project to figuring out what to do with it, that’s going to cost some money. We’re going to need to know how much money that costs, once you figure out how you’re going to do it,” Senate Appropriations Energy and Water Subcommittee Chair Dianne Feinstein (D-Calif.) said at a hearing this week.

Because  appropriations committees are moving forward with marking up spending bills for FY’15, DOE would need to submit any changes to its budget request soon. “If it’s going to be included in the appropriations process in an orderly way, we need that in a couple of weeks,” NNSA Administrator Frank Klotz said at the hearing. Ranking Member Sen. Lamar Alexander (R-Tenn.) noted: “It will be easier for the Department, I think, if whatever you recommend is accepted by the Congress to make it part of the orderly process rather than come in late with it. We know that you didn’t cause the bankruptcy and this is a sudden development, but that’s just the schedule we’re on.”

ORNL Takes Over as RD&D Program Ends

The subcontract is worth $34 million through the end of this fiscal year, and has two six-month $42 million option periods that would take it through Fiscal Year 2015 for a total potential value of $118 million. The Department has about $9.6 million in appropriated funds left for a centrifuge program from a nearly two-year research, development and deployment program that ended this week, which built out a full cascade of centrifuge machines. DOE also has $56.65 million in reprogramming authority this fiscal year  is contingent on completion of a cost-benefit analysis that has not yet been submitted to Congress. The deal would fund American Centrifuge at about 60 percent of current levels, and would focus on monitoring operations of the currently built cascade of centrifuges. However, it would not fund the centrifuge manufacturing plant at Oak Ridge, and the fate of the manufacturing capability remains uncertain.

NNSA: May Purse Small-Scale Enrichment Facility

This week Klotz said DOE may look to build out a small enrichment plant, emphasizing that a domestic source of enrichment is needed for national security needs such as tritium production and naval reactor fuel. “The Department may pursue a small-scale enrichment facility using ACP technology capable of meeting national security requirements or determine that there is additional time to examine other potential technology,” he said at the hearing. “But we will continue to closely monitor the evolving defense program requirements to determine if and when and what action is needed to acquire additional unobligated low-enriched uranium. Within the department itself, we have formed a department-wide working group, including representatives for NNSA, to address the national security and broader commercial requirements.”