U.S. Secretary of Energy Ernest Moniz on Jan. 15 outlined actions his department is taking to improve project management and performance on troubled projects, such as the Mixed- Oxide Fuel Fabrication Facility in Savannah River, S.C., and the Hanford Waste Treatment Plant in Washington state.
Some of those steps include requiring more-developed designs before major projects can begin, reconstituting the Energy Systems Advisory Board process and establishing a portfolio review board to provide independent assessments of the risk profiles for all major capital projects.
Moniz's remarks were informed by a DOE working group, established in 2013. The group—led by DOE senior adviser John MacWilliams, formerly of Tremont Energy Partners LLC, a Cambridge, Mass., private investment firm—met biweekly for more than a year to analyze project management issues at DOE. In December 2014, the group released a report outlining actions DOE could take to improve project management and performance. In addition to sometimes inconsistent federal funding, there is a lack of ownership and accountability at DOE for projects that can prove challenging, the working group concluded. One solution under consideration is to establish a departmental project management organization—modeled after similar offices at the Dept. of Defense, U.S. Army Corps of Engineers and Naval Facilities Engineering Command—that would be solely responsible for delivering capital construction and environmental remediation projects across DOE.
Another area for improvement is in front-end planning. Insufficient preliminary planning on projects, such as at the Savannah River site, consistently contributed to cost increases and schedule delays across DOE, the report concluded. "There's no sugarcoating it—it's tough. These were hard discussions because … these are big projects, lots at risk, with different cultures and different objectives in a complex organization, at its core a science-and-technology organization," Moniz said.
Some industry firms say DOE should be commended for its efforts to improve management of projects. Fred deSousa, a spokesman for Bechtel, says the report includes a number of "good suggestions, especially its observations about requirements management, funding stability and approach across the enterprise." But he adds, "As always, the key will be building from these recommendations and implementing them in a practical way."
Others note that while DOE critics abound, many of the projects that have run into difficulties are extremely challenging, difficult projects.
"DOE has had these issues for a very long time with just about every major project," says one industry source, who asked not to be identified because of the sensitivity of the issue. "The reason is [that] these are very unique, one-of-a-kind, never-been-done-before projects," he notes.