Greg Mello's comments sent to congressional colleagues addressing Congressman Cooper's amendment 266 to H.R. 6395 re: independent cost estimate & study of the Savannah River Plutonium Processing Facility (SRPPF)

July 8, 2020

Dear colleagues -- The Cooper amendment to H.R. 6395 appears to have two objectives:

a. To provide a politically-feasible means of escaping the current requirement to begin producing at least 80 pits per year (ppy) by 2030 without interfering with investments in pit production capacity at LANL, and

b. To further cement the role of Los Alamos National Laboratory (LANL) as the default pit production site, and to use this prejudice as a political tool in negotiations with the Senate to achieve the first goal.

The independent cost estimate required at (a)(1) is already required by Department of Energy (DOE) Order 413.3B, as the amendment notes.

For projects ≥$750 million (M), critical decision (CD) authority rests with the Deputy Secretary under the Order and can be delegated (p. A-4). So Secretarial certification would be a new requirement and of course in this case a statutory one.

The 90% confidence in cost and schedule required at (b)(1) and (b)(2)(A) is not part of Order 413.3B, which stipulates (for example) only a 80-90% confidence requirement for (simpler) nonnuclear project baselines at the time of CD-2 (p. A-10).

In 2019 the Institute for Defense Analyses (IDA) observed that all major DOE projects costing more than $700 M have experienced “substantial cost growth and schedule slippage,” or else were cancelled. All the completed major projects required at least 16 years to achieve CD-4 (construction completion).

Therefore, the likelihood of any DOE Secretary being able to certify, with 90% confidence, that the Savannah River Plutonium Processing Facility (SRPPF) project cost will remain within its CD-2 (Performance Baseline) cost estimate over a decade or more of subsequent detailed design, procurement, and construction is remote. Equally remote is the prospect that any DOE Secretary making such a certification would still be serving when the final bill for SRPPF is compiled.

In the absence of that unrealistic certification:

a. The Secretary must revise the SRPPF cost, schedule, and scope – a normal part of the CD-2 process, but even after such revisions no DOE cost estimate for a project of this size has ever been able to meet this standard, so on its face this requirement kills the SRPPF; and

b. The STRATCOM Commander must decide whether the DOE Secretary’s failure to certify at SRPPF (but not at any of several necessary LANL pit production projects) will lead to a delay in pit production that constitutes a “grave threat to the national security of the United States.” Failing that level of concern, the STRATCOM Commander must certify that the pit production deadline can be extended by “up to 5 years.”

The wording of the operative clauses of this amendment, sections (b)(1)(B)(i) and (ii), is at best unclear and at worst illogical.

The amendment does not say how such a “grave” threat to national security might be cured, other than “taking into account options” – assuming such options can be provided in future years, because they will not exist until, in the most optimistic case, several years after this judgment is necessary – “for temporarily surging the production of…pits at [LANL]” and “other mitigation strategies.”

No date for the Secretary’s required cost estimate and certification are specified. A detailed cost estimate cannot be prepared until CD-2 at the earliest. As far as we can tell, no CD-2 date for SRPPF has been provided in public since April 2019, when an NNSA presentation said FY “2023.” NNSA will not know until at least 2025 if PF-4 is even serviceable for pit production, and will not have “surge” capacity until at least 2026 (the deadline for 30 ppy at LANL). According to NNSA Administrator Lisa Gordon-Hagerty, LANL will be hard-pressed to achieve that milestone.

Thus the STRATCOM Commander will not be able to “take into account” the “option” of “temporarily surging” pit production at LANL until three years after SRPPF CD-2, under current schedules for both.

In September 2017, the National Nuclear Security Administration (NNSA) stated that producing 80 or more ppy by 2030 was unrealistic; “2033 at the earliest” (p. 2) was realistic if work began in earnest in FY2018. It did not; a year was lost due as result of congressional pushback. In May 2019, IDA concluded that the goal of producing ≥80 ppy by 2030 was impossible and urged the Department of Defense (DoD) to begin making alternative plans. It is not clear why the armed services committees agreed to the unrealistic 2030 deadline in the first place.

The “up to 5 years” extension available through this amendment appears not only realistic but necessary whether or not the cost estimate for SRPPF can be certified. This amendment appears to be, in part, a face-saving measure for the armed services committees.

The greatest problems with this amendment are these.

a. It establishes a standard known to be impossible for projects of this nature for the unstated purpose of ending the SRPPF. The honest approach would be to not authorize the project.

b. It applies only to SRPPF and not to plutonium modernization and related capital asset acquisitions at LANL, which:

i. Are larger than those planned at SRS, both over the coming 5 years and possibly after that as well.

ii. Have more than doubled since 2017 in estimated cost to achieve 30 ppy, from $3 billion (B) (slide 2), to at least $6.8* B.

*Pu modernization at LANL FY18-25, actual and requested, plus Chemistry and Metallurgy Research Replacement (CMRR), Transuranic Waste Facility, and TA-55 Reinvestment Project Phase III; no estimated cost for FY2026 is included)

iii. Requires, to achieve only 20 ppy, what IDA called (p. vii) the “very high risk” strategy of operating LANL’s main plutonium facility on a 24/7 basis (p. 12 here).

c. This amendment posits a present situation, record of success, and future capabilities at LANL which have never existed, do not exist now, may never exist, and are likely to be at best temporary assuming they can be built and maintained at all, which will be at great cost. This is at best delusive in the sense of Flyvberg et. al. I will have to take up the situation at LANL in more detail in another memo, to follow as quickly as possible.

The goal of releasing government from the present unrealistic and unnecessary pit production goal is laudable. The prejudice and lack of realism in this amendment are likely to prevent success.

Take care of yourselves please, and write or call if you have any questions at all.

Very best wishes to all of you,

Greg Mello and Trish Williams-Mello