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Vit Plant Costs May Top $10 Billion

Posted on: Wednesday, 8 February 2006, 18:00 CST

By Annette Cary, Tri-City Herald, Kennewick, Wash.

Feb. 8--Hanford's vitrification plant could cost more than $10 billion before it's ready to begin treating radioactive waste in the spring of 2017, according to a new report.

The legal deadline to begin turning radioactive waste into a stable glass form for permanent disposal is 2011.

The cost and schedule estimate, contained in a 44,000-page reportprepared by contractor Bechtel National, was given to Washington congressional and state leaders Tuesday.

It is the latest attempt to calculate the cost of the project since it became apparent last year that the official estimate of $5.8 billion was too low, and that the plant would not be treating waste by a legal deadline.

About 53 million gallons of radioactive waste from the past production of plutonium for the nation's nuclear weapons program are stored in aging underground tanks.

The new estimate puts the cost at almost $8.8 billion. But it does not include an undetermined fee for Bechtel or an allowance for uncertainties in the project that likely would be the responsibility of the Department of Energy.

Bechtel estimated those risks at nearly $1.8 billion, which would bring the cost without the contractor fee to $10.5 billion.

"This is Bechtel's revised estimate based on new seismic criteria and other technical challenges," said Mike Waldron, spokesman for DOE in Washington, D.C.

However, DOE will not endorse the estimate until the Army Corps of Engineers has validated Bechtel's numbers. Energy Secretary Samuel Bodman has said he will base a plan for completing the vitrification plant on verifiable facts and Bechtel's numbers haven't been verified, Waldron said.

Bechtel spent six months preparing the document -- called an "estimate at completion," -- after the Corps said last year that an earlier estimate at completion did not contain complete enough information to be verified.

But the Corps document said the cost of the plant could increase to as much as $9.6 billion.

Bechtel National already is at work on a revision of its latest estimate at completion that is expected to adjust the cost upward because of changes since it began work on the estimate. That updated estimate should be ready in May.

Among the biggest changes has been a reduction in the expected vitrification plant budget for the current fiscal year from the $626 million Bechtel had expected to $526 million as it was finishing the report. That reduction led to the temporary halt to construction on key parts of the plant.

In addition, Congress has separated funding for the five major facilities at the plant, which will increase overhead costs and limit flexibility, Bechtel believes. Technical reviews of the project also could lead to changes.

The estimate released Tuesday adds 26 months to the building schedule and $700 million to $900 million to the cost because of new earthquake design standards. An earthquake study in late 2004 indicated the earlier standards might be inadequate for a severe earthquake.

Other factors driving the cost increase include solving science problems for the first-of-a-kind plant, increased costs for labor and materials, design changes that have required more construction material and more contingency money.

The Bechtel contingency built into the budget was increased from $550 million to $1 billion to cover uncertainties such as the total amount of building material needed and employee wages.

That does not include risks in the $1.76 billion estimate that fall outside Bechtel's responsibilities. Those risks include possible upgrades to the plant, reductions in funding from Congress and potential changes to air emission requirements by regulators.

DOE was criticized last year for not releasing enough information about the changing cost and schedule of the vitrification plant. This year, Rep. Doc Hastings, R-Wash., has praised DOE for being more open about releasing information as work continues to develop a plan for completing the project.

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Copyright (c) 2006, Tri-City Herald, Kennewick, Wash.

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Source: Tri-City Herald

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