DOE Readies Big Contracts But Nuke Waste Cleanup Costs Keep Rising
The U.S. Energy Dept. plans to award up to $47 billion in defense waste cleanup and management contracts this year and next across its former nuclear weapons complex, with three major ones set in June for work at the Hanford site in Washington state. They include one valued up to $15 billion to maintain and finally close 144 underground tanks in the next decade. The tanks, built since World War II, once stored up to 56 million gallons of chemical and radioactive waste. But work at that site and others will come amid new, higher projected DOE-wide cleanup estimates and concern about project funding, approaches and completion.
“We believe this round of contract awards could resemble the robust [U.S. Dept. of] Defense awards the [engineering and construction] industry experienced in 2017-2018,” said Steven Fisher, sector analyst for investment firm UBS, in an April 17 report. Other key Hanford contracts include a $4-billion to $6-billion award for “essential services” and one to manage cleanup in the 560-sq-mile site’s central region, valued at $7 billion to $12 billion.
The tank farm and central Hanford contracts are set to be indefinite-delivery/indefinite-quantity awards, with work done through individual task orders. The tank farm award will now include support of Hanford’s long-delayed, $17 billion waste vitrification plant project and set for limited startup in 2023. Three teams set to present oral responses in April are incumbents AECOM and Atkins; Fluor Corp. with BWX Technologies; and Jacobs Engineering with Honeywell, say press accounts.
Meanwhile, DOE is weighing bids for a cleanup contract at its Oak Ridge, Tenn., site that is valued between $4 billion and $8 billion and set for award in the first quarter of 2020. It also is seeking to award a $12-billion to $15-billion operations and maintenance contract at the Savannah River Site complex in South Carolina, but an agency major procurement list published in March does not indicate when a final solicitation will be issued or an expected award date. The current contract expired July 31, 2018. Fisher expects the award to be made within the next year.
Other key procurement awards include one for cleanup of DOE’s Idaho nuclear waste management complex, set for summer 2020 but with contract value undetermined, DOE said, and an award by November of a small-business contract of up to $400 million for environmental program services at its Nevada Test Site. The agency also plans to hire a contractor to manage site deactivation and decommissioning nationwide.
The Hanford awards come as DOE officials and site stakeholders weigh new approaches based on higher long-term cleanup cost estimates by DOE and the administration plan to cut $400 million from the site’s fiscal 2020 budget, to $2.1 billion. The projection, issued in January, says remaining Hanford cleanup could cost from $323.2 billion to $677 billion and extend to the next century, up from $107.7 billion and a 2066 completion in DOE’s 2016 projection, according to the Tri Cities Herald.