Half-Built Nuclear Fuel Plant in South Carolina Faces Test on Its Future

By James Risen
Feb. 8, 2016

Mixed Oxide Fuel Fabrication Facility (MFFF) near Aiken, S.C. Photo: High Flyer/SRS Watch

WASHINGTON — Time may finally be running out on the Mixed Oxide Fuel Fabrication Facility, a multibillion-dollar, over-budget federal project that has been hard to kill.

The Energy Department has already spent about $4.5 billion on the half-built plant near Aiken, S.C., designed to make commercial reactor fuel out of plutonium from nuclear bombs. New estimates place the ultimate cost of the facility at between $9.4 billion and $21 billion, and the outlay for the overall program, including related costs, could go as high as $30 billion.

Officials warn that the delays in the so-called MOX program are so bad that the plant may not be ready to turn the first warhead into fuel until 2040.

So in the budget that the Obama administration will present on Tuesday, the Energy Department proposes abandoning it. Energy officials want to spend only the money necessary to wind down the MOX program while the government shifts to a different method of disposing of the plutonium.

But what is a white elephant to the administration is a source of 1,700 construction jobs to state officials and members of the South Carolina congressional delegation, who have vowed to stop the move. “Here we are, halfway through this damn thing being built, and they say, ‘We don’t want to do this now,’ ” said Senator Lindsey Graham, Republican of South Carolina, speaking for those officials.

The struggle is a case study in the difficulty of cutting unnecessary or wasteful federal programs, with the added twist that proponents of keeping the plant include some of the Republican Party’s most determined opponents of government spending, like Representative Joe Wilson, a South Carolina Republican whose district includes Aiken.

“The administration must complete construction of MOX — the only viable method at this time of disposing of the plutonium,” Mr. Wilson said in a statement.

Two companies involved with the plant’s construction are among Mr. Wilson’s biggest contributors, according to campaign records. Chicago Bridge and Iron, one of the two companies that own the main contractor for the facility, gave $10,000 to Mr. Wilson’s 2014 re-election campaign, and the other owner, Areva Group, donated $8,000, according to campaign records.

“Programs like this stay in the budget when they become jobs programs, and then senior members of Congress try to protect them, even if they have no redeeming value,” said David Hobson, a former Republican congressman from Ohio who said he tried and failed to kill the MOX program while he was in the House. “Where are all the budget hawks on this?”

Mr. Wilson countered that the administration had used “discrepancies in data” to overestimate costs for finishing the project. Proponents of the MOX plant also cited a recent study, paid for by the main contractor working on the plant, that concludes that the costs of the program are much lower than the estimates in recent studies sponsored by the Energy Department.

The Obama administration has wanted to get rid of the program for years. In a budget request three years ago, it said the idea of making reactor fuel “may be unaffordable.” But Congress has repeatedly restored funding.

The plant is being built to comply with an agreement with Russia in 2000, when both countries said they would eliminate 34 metric tons of weapons-grade plutonium from their nuclear arsenals. Construction started during the George W. Bush administration, but has been plagued by long delays, cost overruns and little interest from commercial nuclear plants in buying the fuel that the plant was designed to produce.

Even proponents of the program have long said the Energy Department badly managed it.

“This is one of the most important nonproliferation programs ever, but when it comes to implementing this agreement, it’s been a nightmare,” Mr. Graham said.

Giving up on the plant means the administration will abandon plans to turn the weapons-grade plutonium into fuel for commercial nuclear reactors, and will instead switch to a process that dilutes the plutonium into nuclear waste.

The Energy Department would like to move that nuclear waste to a facility near Carlsbad, N.M., where it would be stored deep underground in salt formations. The administration says it can get rid of the weapons material under the alternative approach for about $300 million to $400 million a year, compared with $800 million to $1 billion a year under MOX.

“There have been several independent analyses that have concluded that the MOX fuel approach for plutonium disposition will be significantly more expensive and take longer than anticipated,” said John J. MacWilliams, a top Energy Department official. “The analyses also all confirmed that there is an alternative option that would be less than half the cost of the MOX fuel approach.”

Still, the administration faces big obstacles before it can make the switch. It will have to persuade the Russian government to agree to modify the agreement to allow the United States to change its method for disposing of the plutonium.

Another hurdle is the New Mexico underground storage facility, which has been closed for two years because of a 2014 leak of radioactive material. Once it reopens, the Energy Department will have to obtain legal and regulatory approvals to store the plutonium waste there, and that will mean winning over New Mexico’s political leaders, who are not yet convinced.

“There are a number of very tough questions that have to be answered before this could move forward,” said Senator Tom Udall, Democrat of New Mexico.

Mr. Wilson, who gained fame for shouting “You lie!” at President Obama during a presidential speech to Congress in 2009, is not backing down. He has an important Democratic ally in the House — Representative James E. Clyburn of South Carolina, who supports continued funding for MOX.

In late January, Gov. Nikki Haley of South Carolina, a Republican, issued a letter formally asking Mr. Wilson’s son — Alan Wilson, South Carolina’s attorney general — to sue the Energy Department over MOX. The grounds for the lawsuit are expected to be based on the fact that the Energy Department missed a Jan. 1 deadline for the removal of some of the plutonium out of the state, and the suit is expected to claim that the department owes fines to South Carolina.

“As the state’s chief legal officer, our office has been working to protect the MOX facility legally for more than two years,” Alan Wilson said in a statement. “The Department of Energy has continually shown disregard for its obligations under federal law to the nation, the State of South Carolina and frankly the rule of law.”

Even if the administration can get past the Wilsons, Mr. Graham will be tougher to beat. He sits on the Armed Services and Appropriations Committees, the two most important Senate panels dealing with the program. He is not satisfied by what he has heard so far from the administration.

“If you tell me that MOX won’t work after all this, then why should I believe you when you say the other thing will work?” Mr. Graham said. “How can the government miss this so badly? Somebody should be fired over this.”