Uranium Supply and Demand Estimates

GAO has been studying the future of nuclear power in the United States and has reached certain preliminary conclusions. The Department of Energy (DOE) has not been accounting for uranium losses occurring in the milling process when assessing the adequacy of the nation's uranium resource base to meet the expected demand, the grade of uranium ore processed has been declining, and a proportional rise in milling losses has occurred. To achieve estimated production totals, increased uranium resources will be required. However, in April 1977 the Administration proposed termination of the Clinch River Breeder Reactor project because of the risk of nuclear proliferation; the facility's technical obsolescence, small size, and high cost; and the lack of urgency for breeder reactors operating in the United States at present. GAO found that termination of the project would have little effect on nuclear nonproliferation; that the project was not technologically superannuated, but had been continuously updated; and that projected uranium supply and nuclear power data indicated a need for more breeder reactors, not fewer. GAO also concluded that Clinch River's intermediate size was logical and prudent; that replacing the project with a larger, unlicensed facility on Government property would undermine public confidence in breeder technology commercialization; and that abandonment of the project would discourage utilities and suppliers from committing themselves to the breeder program. DOE has estimated that commercial breeders will not be needed until after 2025. GAO felt that long-range planning should be based on high-probability projections rather than on speculation. The DOE estimate of 2025 as the necessary date for breeder operation was based on a projected uranium supply exceeding the quantity suggested by the data used in the Department's economic model. Since a decision not to proceed with breeder reactors would constitute a repudiation of nuclear power as a future national energy source, GAO recommended continued funding of the Clinch River project. If Congress decides to continue the project, the Administration's rigid opposition will have to be overcome somehow.