YAKIMA – The cost to build a waste treatment plant at the highly contaminated Hanford nuclear reservation in south-central Washington has risen to $11.55 billion, according to a new cost estimate released Wednesday by the U.S. Department of Energy.
The vitrification plant is being built to convert millions of gallons of radioactive waste to glasslike logs for permanent disposal underground in a nuclear waste repository. The plant has long been considered the cornerstone of cleanup at the Hanford site, but the project has been mired in cost overruns, construction problems and delays.
The Energy Department hired contractor Bechtel National in 2000. At that time, the project was estimated at $4.3 billion.
The May 2006 estimate released Wednesday puts the new construction cost at about $10.4 billion, which includes $1.6 billion in contingency money to address possible unknown costs, plus $1.1 billion to address other potential identified risks.
That brings the cost to a little more than $11.55 billion, an estimate that does not include the contractor’s fee.
The new estimate also extends the projected start of operations to 2019, far beyond the date of 2011 legally required under the Tri-Party Agreement, a cleanup pact signed by the state, Energy Department and Environmental Protection Agency.
The federal government created Hanford in the 1940s as part of the top-secret Manhattan Project to build the atomic bomb. Today, it is the nation’s most contaminated nuclear site, with cleanup costs expected to total as much as $60 billion.
Key to the cleanup is the removal of 53 million gallons of toxic, radioactive waste left from Cold War-era nuclear weapons production. The waste is stewing in 177 aging underground tanks, 67 of which have leaked more than 1 million gallons of waste into the ground.
Some of that waste has reached the groundwater, threatening the nearby Columbia River and making completion of the plant a priority. Once completed, it will stand 12 stories tall and be the size of four football fields.
The project’s problems have been large as well. The one-of-a-kind plant is being designed as it is built, which has proven costly. Billions of taxpayer dollars already have been spent, with design about 65 percent complete and construction about 25 percent complete.
The new estimate actually is closer to the $15.2 billion estimate proposed in 2000 by former contractor BNFL Inc. The Energy Department fired the company shortly thereafter.
Three years ago, the Defense Nuclear Facilities Safety Board raised concerns that the Energy Department’s seismic review was inadequate. A new review found that the department had underestimated the effect a severe earthquake would have on the plant.
At the same time, the rising cost of construction materials and other technical problems came to light, prompting the department to slow construction. About 400 construction workers are at the site today, down from about 1,800 in March 2005.
Energy Secretary Samuel Bodman ordered an external team of experts from the engineering and construction industries and academia to review the latest round of estimates to restore confidence in the project.
Still, the latest delay marks the fourth time the original operating deadline of 1999 has been pushed back. The current schedule also depends on an annual appropriation of $690 million from Congress for the project, beginning in 2007.
Gov. Chris Gregoire has threatened to sue the federal government if Congress does not continue to fully fund the project.
“It just lets us know that every time the funding slips, then the schedule for the project falls behind as well,” Joye Redfield-Wilder, a spokeswoman for the state Department of Ecology, said of the new estimate. “We’re considering all of our options.”
Meanwhile, the federal Energy Department will begin negotiating a new contract with Bechtel, including the company’s fee, based on the new estimate, department spokesman Erik Olds said.
“Right now, we don’t have a time frame for those negotiations. We’re focused on getting an accurate and defensible cost and schedule in place,” Olds said.
Earlier this month, the Energy Department notified Bechtel that it must return $48 million the company has been paid as a performance fee for the project.
Under its current contract, Bechtel could have earned as much as $445 million for building the plant. About $200 million was tied to a so-called cost-performance fee for meeting the budget. The company was given 45 days to respond, and has not done so.
“We will respond in the 45 days, and then sometime in the not-too-distant future, we will be sitting down with DOE to renegotiate the contract to reflect the greater scope of work on this job,” Bechtel spokesman John Britton said.
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