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March 12, 2014

Bulletin #187: Obama seeks more warhead money than Reagan; nuke pension subsidies; MOX dying?; plutonium pit infrastructure

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  • Obama outdoes Reagan in nuclear warhead R&D, production spending
  • When princely salaries aren’t enough: rising subsidies to warhead worker retirements
  • MOX is probably dying; long live direct geological disposal at WIPP or in boreholes
  • Plutonium pit infrastructure: “module” plan undercut by major congressional study

  • We have more news, but it must wait until next time.

    Dear friends and colleagues –

    1.   Obama outdoes Reagan in nuclear warhead R&D, production spending

    As you saw, the President’s budget request last week was a real doozy (President Requests Unprecedented Spending on Nuclear Weapons Maintenance, Design, Production, March 4).  The White House asked for an extraordinary sum of money -- $8.6 billion (B) – in the Department of Energy (DOE) for nuclear warhead research and production – significantly more than Ronald Reagan did in 1985, the Cold War’s highest peak for design, testing, and production, in constant dollars.  This year’s request is for a 7% increase over current-year spending. 

    Here’s a Study Group graph (pdf) of the coming five years’ proposed spending, in the context of spending for comparable activities since 1948, with and without a guess at present and future (official, i.e. Consumer Price Index, CPI) inflation.  (I believe real inflation is much higher than CPI inflation, especially among DOE nuclear warhead contractors.) 

    DOE and its National Nuclear Security Administration (NNSA) subsidiary also asked for an additional $504 million (M) for warhead work in the so-called “Opportunity, Growth, and Security Initiative,” a $56 B proposal which immediately garnered a frosty reception on Capitol Hill from key Democrats as well as Republicans.  This proposal seems unlikely to go anywhere, and it is doubtful NNSA could really spend that much money (which would be a 13% increase) in a single year even if it were appropriated. 

    These proposed warhead funds are just part of the total cost for the U.S. nuclear triad.  In December, the Congressional Budget Office (CBO) tallied this year’s cost of the U.S. nuclear arsenal as $23.1 B.  Using CBO’s estimates of (rising) spending on new delivery systems (and without any study of forthcoming details in the FY2015 budget request), the total proposed cost for the triad in FY2015 will be about $25 B.  Over the next decade, the CBO expects the average cost of the nuclear triad to be about $35.5 B per year.  In other words the cost of U.S. nuclear weapons – operations, modernization, and maintenance, but not legacy costs like cleanup – is expected to rise dramatically over the coming decade (and keep rising after that, as delivery system acquisition begins in earnest). 

    Keeping the present U.S. arsenal, with planned upgrades and replacements, will cost $1 trillion over the coming 30 years, assuming all goes reasonably well with planned major procurements (“New study of nuclear deterrent costs: current plans to cost $1 trillion over 30 years, therefore impossible,” LASG press release publicizing James Martin Center publication, Jan 8, 2014). 

    We’ve been on the radio in various U.S. cities talking about these developments over the past week, in part thanks to help from the Institute for Public Accuracy.  Our press release was picked up by various other outlets (e.g. “Obama Worse Than Reagan Nukes Now,Counterpunch, March 6, and “President Requests Unprecedented Spending on Nuclear Weapons Maintenance, Design, Production,” warisacrime.org, March 5). 

    The Los Alamos Monitor picked up our most important comments:
    With these [warhead and project cancellations], an important workload ‘gap’ or ‘breather’ begins to open up in the 2020s at the weapons labs.  We believe the weapons labs are even now greatly oversized for their missions, and today’s budget, with the changes noted, advances the possibility of a gradual downsizing of overall warhead effort, even without the stockpile shrinkage that is long overdue.

    In New Mexico, it is a big mistake to depend on Cold War weapons programs as a prop for our economy, let alone as a source of growth.  There just isn't going to be significant growth in those programs, ever, and eventually there will be decline in real terms.  Even when there has been growth, the record shows New Mexico has not benefited as a result.  Nuclear weapons are an economic and political liability for the state, along with our severe inequality, poverty, and our poor educational outcomes.

    The plutonium industry, if it were to expand, would be particularly negative for Santa Fe and the region.

    The New Mexican picked up the second and third of these themes in their article, along with what is probably the important thing in the new budget for Santa Fe: the Administration is not (yet?) asking for money to build plutonium factory “modules” at LANL, about which more below.  The Albuquerque Journal picked up on the budget comparison with Reagan, which should indeed capture wide attention (“Obama budget boosts NM labs,” Albuquerque Journal, Mar 5).   

    We expect further important budget details to be released this week and will issue a press advisory regarding them.  Aside from the unprecedented sums proposed for nuclear warhead R&D and production – that part we already know – details on specific warhead programs will be provided, including on the administration’s new approach to plutonium warhead cores (“pits”).


    2.   When princely salaries aren’t enough: taxpayer subsidies to warhead worker pensions to approach $1 B next year

    An interesting summary of taxpayer contributions to corporate defined-benefit retirement plans for DOE contractors was posted yesterday.  Within the $1.6 B slated for DOE’s contractors, NNSA prime contractors are slated to receive $951 M this coming year, 8.2% of the total NNSA budget, to “stabilize” pension portfolios and lower employee contributions. 

    Last year (FY2013), many NNSA payments were far in excess of minimum federal requirements -- $366 M in excess overall.  For example, taxpayers paid Sandia National Laboratories (SNL) $175 M in FY13 to bolster the SNL pension plan.  The required federal contribution was zero.  You might think that Lockheed-Martin, the world’s largest defense contractor and the largest government contractor in the U.S., of which SNL is a wholly-owned subsidiary, could have found ways to fluff up the SNL pension plan as desired.  Or perhaps SNL employees, whose average total compensation is in the ballpark of $200,000 (including health insurance and retirement contributions), might have chipped in a bit more. 

    Or take LANS, the contractor that runs LANL.  A $110 M cash transfer to this partnership of Bechtel, URS, B&W, and the University of California occurred last year that “realigns contributions among fiscal years to create a more stable stream of payments.”  The portion legally required: $3 M.  We believe average LANS total compensation is in the same general vicinity as at SNL.  Surely these employees could afford to contribute a few more percent of their salaries to “stabilize” LANS’ pension plan. 

    Or perhaps LANS could contribute something from the $59.3 M in fees it earned last year.  After all, the National Academy of Public Administration (NAPA) suggested last year (p. 83) that corporations managing DOE national labs receive only a “nominal” fee for this service, since the present fee system looked to them (as it does to us) irrelevant to accountability and performance.  

    Reliable sources tell us that taxpayer-protected, private, defined-benefit pension plans for federal contractors, in companies that are otherwise quite solvent, are pretty unique.  DoD, for example, provides no such subterranean cash pipeline to its contractors. 

    The aggregate sums involved greatly exceeds what NNSA pays in management fees, and is a form of corporate and employee subsidy.  If portfolio values were to tank (again) it would be taxpayers – not Lockheed-Martin or Bechtel – who would be on the hook to keep thousands of nuclear retirees comfortable.  In 2012, NNSA projected that these payouts could, under some assumptions, reach $3 B per year. 

    (For more on these “unique” nuclear contracting arrangements, you might want to see the old-but-still relevant “Competition - or Collusion? Privatization and Crony Capitalism in the Nuclear Weapons Complex,” Los Alamos Study Group, May 2006.  This brief sketch only just touches on the many issues involved here.) 

    3.   MOX is probably dying; long live direct geological disposal of surplus plutonium, including at the Waste Isolation Pilot Plant (WIPP) or in boreholes

    In a welcome development that has been years in the making, the Administration proposes to put the (two-thirds built) $8 B Mixed Oxide Fuel Fabrication Facility (MFFF) construction at the Savannah River Site (SRS) near Aiken, South Carolina, on “cold standby,” and with it the circa $30 B Mixed Oxide (MOX) plutonium disposal program, of which MFFF is the central, indispensable facility.  The mostly-finished $414 M Waste Solidification Building (WSB), which is or was to receive waste from MFFF, was placed on cold standby late last year.  The Pit Disassembly and Conversion Facility (PDCF), which was to process pits into plutonium feedstock for MFFF, was previously canceled in February of 2012 after the expenditure of several hundred million dollars on various failed designs; NNSA realized the facility was not actually needed to process pits. 

    Despite present vociferous objections from the South Carolina delegation, the MOX program is now likely to be terminated.  At least some of the future appropriations previously planned for the MOX program would in that case be available to cover cost overruns elsewhere in NNSA, i.e. in warhead programs and construction. 

    Should the MOX program die – and it certainly should, for any number of reasons, as we have been saying since the program was a twinkle in the eye of former Rep. Spratt – something else will need to be done with 43.3 metric tons (MT) of plutonium currently declared surplus, as well as the future declarations which need to follow.  This 43.3 MT is mostly stored at the Pantex plant near Amarillo and at SRS.  (See Table 3, p. 14 in "The United States Plutonium Balance, 1944-2009,” Jun 26, 2012).  As some of our colleagues (finally) said in 2012, it’s “time to bury plutonium” (“Nuclear proliferation: Time to bury plutonium,” Nature 485, pp. 167–168).

    There is no rush to bury it, provided it remains safely guarded.  The marginal cost of protecting this particular plutonium – over and above the cost of protecting non-surplus plutonium, weapons, and high-level waste – at these sites is in general very low.  Sooner or later it must be disposed, however, and burial, with various degrees of preprocessing, is now the prime path.  Multiple disposal alternatives are theoretically possible.  Russian agreement is necessary.    

    Some of these alternatives would take this additional plutonium to WIPP.  WIPP, as many of you know, is authorized to dispose of transuranic waste from the U.S. nuclear weapons program – which this would be.  Besides WIPP, another disposal scenario under active consideration would use deep boreholes, a technology that has matured greatly in the past two decades. 

    WIPP suffered two significant accidents in February, shutting down disposal operations for an indeterminate time.  Seventeen workers have been contaminated.  Subterranean cleanup of salt tunnels could be slow, and it is clear that new equipment and procedures are needed.  But we do not think these travails are in any way fatal to WIPP’s important mission. 

    We at the Study Group have always judged MOX to be an unsound disposition pathway and have lobbied for its termination.  Now, all reasonable disposal paths should be investigated and vetted through open, public processes, and of course discussed with Russia.  Some of these options involve the WIPP site, which looks to us like a very good place to put more plutonium waste, with or without various means of immobilization.  

    Essentially, twenty years and billions of dollars have been wasted on MOX, for the usual reasons.  Arms control and “nuclear security” NGOs and their funders, closely allied with the Clinton Administration, played a central role in this waste and delay.  To their credit, other NGOs argued strenuously, and made compelling cases, that this disposition pathway was grossly cost-ineffective and had other major flaws.  It hasn’t worked out, and it won’t. 

    Among the options we believe worthy of renewed consideration is the direct disposal of non-immobilized plutonium, including demilitarized pits, at WIPP.  In the case of pits, these could be shipped directly from Pantex, where demilitarization could take place without opening the pits.  There are a couple of dozen ways (physical, chemical, and mechanical) to ensure a pit could never again be used in a warhead.  One example is to place pits in malleable, sealed metal envelopes and crush them, with admixed chemicals to further decrease the likelihood of inadvertent criticality and/or to greatly reduce the ease of future use. 

    Approaches involving immobilization in an inert matrix (e.g. glass, ceramic) are possible as well, although they would cost billions of dollars and be subject to all the risks we have seen in large NNSA nuclear construction projects (cf. “Nuclear Waste: Washington has ignored a cheaper way to dispose of its plutonium — until now,” Douglas Birch and R. Jeffrey Smith, Center for Public Integrity, June 27, 2014.) 

    This is not the place or time to discuss these complex issues at length.  We wanted you, our members, to understand that the Los Alamos Study Group supports the study of disposal of much more plutonium at WIPP than is currently envisioned, including forms of direct disposal that do not involve expensive and risky immobilization and which minimize transportation as well.  It may be that lack of immobilization would be a show-stopper for Russia, but we don’t know that. 

    We believe WIPP is geologically inappropriate for spent nuclear fuel or high-level waste, or for any radioactive waste which is thermally hot.  But WIPP already has tons of plutonium emplaced, with more tons on the way, and we do not see why increasing the mass of plutonium disposed should be an inherently bad thing from any perspective. 

    4.   Plutonium pit infrastructure: “module” plan undercut by major congressional study

    In late February the Congressional Research Service (CRS) concluded a nearly year-long review of pit production options (“U.S. Nuclear Weapon “Pit” Production Options for Congress,” Jonathan E. Medalia, CRS, Feb 21, 2014).  The study lays out a dozen or so major alternatives for achieving the G.W. Bush Administration’s goal (not significantly reevaluated under Obama as yet) of providing for the production of 50-80 new warhead cores (“pits”) per year at Los Alamos National Laboratory (LANL).  Our press release (“Congressional Study Shows Administration’s Proposed New Plutonium Warhead Factory at Los Alamos Is Unnecessary, Unadvised,” Feb. 28) summarized our close reading of the review. 

    The NNSA’s “Plan B” after the Chemistry and Metallurgy Research Replacement Nuclear Facility (CMRR-NF) plan was derailed (the 8th such plan to suffer that fate in the past 25 years) involves construction of underground factory “modules.”  While not rejecting modules completely, the study makes it very clear that NNSA and LANL have not carefully examined options that do not involve new construction. 

    While CRS does not go in for didactic conclusions, journalists quickly saw the study’s importance:

    The Study Group was closely involved in this study over a period of many months (although not so much as LANL).  We should repeat here the author’s generous acknowledgement, which came at the top of his long thank-you list. 

    The author wishes to thank Brett Kniss, Drew Kornreich, and Amy Wong, of Los Alamos National Laboratory, and Greg Mello and Trish Williams-Mello of Los Alamos Study Group, for continuous assistance during the entire project, including discussions, responses to many requests for information, and comments on drafts.
    His thanks should really be directed at those of you who made that assistance possible.

    An abridged version of the report was presented at this year’s annual “Nuclear Deterrence Summit,” which I as well as LANL Director Charlie McMillan attended (“Thinking Inside the Boxes: Can Existing Buildings Meet DoD’s Pit Needs?, Medalia, CRS, Feb 12; slides).  A preliminary briefing was presented to interested congressional staff last fall (“Pit Production Options,” Medalia, CRS, Nov 20, 2013).  All of which goes to say that congressional staff and many others have been part of the process of inquiry and communication associated with this report.  A summary version is forthcoming. 

    We know, from our own conversations on Capitol Hill – and given the fiascos in CMRR-NF, the Uranium Processing Facility (UPF), PDCF and MFFF and the MOX program in general (discussed above), the National Ignition Facility (NIF, which is really no closer to true fusion ignition than the day the first spade of earth was turned or the first billion dollars was spent), the W78/W88 interoperable warhead (cancelled this year), the B61-12 (behind and over budget), and in fact every single NNSA program – congressional appropriations committees are wary of allowing NNSA to jump into huge projects without a very clear mission need and supporting evidence that the proposed new building project is the best way to go.  It is now very clear, or should be very clear, that the module plan “is not ready for prime time” and may never be.  Several major questions remain unanswered. 

    Since, as of this afternoon, proposed budget details for FY15 are not yet available, we do not know the Administration’s precise approach to plutonium pit infrastructure next year.  Dr. Donald Cook, Deputy NNSA Administrator for Defense Programs, told reporters last week that the FY15 budget request had no money for modules. (“New budget for LANL does not include money for plutonium facility, Santa Fe New Mexican, Mar 4; “Administration plutonium strategy: no new construction at Los Alamos for now,Albuquerque Journal, Mar 4).  The Armed Services committees were lobbied hard by the labs on modules and passed a law authorizing them, should the Nuclear Weapons Council endorse them.  That law is far in front of NNSA’s and DoD’s headlights.   

    Planning for modules and their associated tunnels is however going on, using leftover CMRR-NF funds (see this NNSA “spend plan,” this tightly-conditioned congressional approval, and their overlap explained very well in this trade press article).  About $50 M remains unspent in the CMRR-NF budget line; it’s possible NNSA might try (despite questionable legality) to spend some of this on the tunnel part of a new module plan. 

    A close reading of the CRS study reveals that NNSA, LANL, and Congress do not know a host of very basic answers about their plutonium pit infrastructure mission.  For example, I now believe these parties do not truly know:
    • How much plutonium Material at Risk (MAR) (if any) must be introduced to LANL’s main plutonium facility, PF-4, to produce 50-80 pits per year there?  Since there is a safe ceiling on MAR for that facility (currently 2,600 kg), it is impossible to know whether any given infrastructure plan is necessary, or sufficient.  Apparently, the MAR burden of pit production, if any, was also not known during the decade and more during which CMRR-NF was proposed.  (Concurrent with pit production, LANL proposes to use PF-4 to produce tons of plutonium dioxide for MOX, even though another and much more capable facility exists for that mission at SRS.  All the more reason to build more plutonium buildings at LANL, eh?)
    • How many square feet of production space is necessary to produce 50-80 pits per year (or any smaller production rate)? 
    • How much MAR, and how many square feet of lab space, are necessary for the analytical chemistry requirements of pit production? 
    • How does all of this vary with the required pit production rate?  This is especially important given that the proposed 50-80 pit per year rate appears to have been an artifact of a) the defunct Reliable Replacement Warhead (RRW) program, which was to subsequently produce an entire “family” of warheads but was cancelled by Congress, and b) the LANL-estimated capacity of LANL’s TA-55 facilities after completion of the CMRR project.  That is, the project, as conceived (by LANL), essentially dictated its mission requirement (from NNSA), rather than vice-versa.  That is why NNSA could suddenly realize, in late 2011, that the project was not needed.  NNSA did not so much change its mind as find its mind. 
    This short list is just the beginning of what NNSA still does not know about this problem. 

    In 1990 I pushed a piece of paper across the table to Senator Jeff Bingaman with the names of existing plutonium facilities on it – facilities which might be able to do the work of the proposed Special Nuclear Materials Laboratory (SNML), the CMRR of its day.  I asked him why there were so many plutonium facilities chasing a declining set of missions, and whether anyone had reviewed the capabilities of existing facilities before building a huge new one.  No one had done such a study, and so later that year the Senator asked DOE for one, holding back funds until it was prepared.  That was the end of SNML. 

    Today, 24 years later, this CRS study is the beginning of an answer to that question, but not the end.  If you can believe it, NNSA, after being led on a decade-long, $660 M CMRR-NF snipe hunt, asked LANL alone – not all the sites -- what its “Plan B” should be.  The other sites were barely involved.  Lo and behold, LANL proposed another big construction project for itself.  As it turns out, other sites have important capabilities which already exist, and the basic mission of producing 50-80 pits per year has really not been closely reviewed.  (Don’t ask which number it is, as there is no clear answer; and don’t ask how many shifts are envisioned in these numbers, as this answer too will be much less clear than it should be.)  LANL does not know some of the most basic parameters of the problem. 

    What LANL is very sure about, however, is that there is a blank spot on the TA-55 map it wants to fill, and an unending thirst for billions of taxpayer dollars.  All the rest of the questions revolve around those answers. 

    More soon,

    Greg, for the Study Group

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