Cost To Retire Uranium Enrichment Facilities Should Be Included in Current Uranium Enrichment Charges

GAO has maintained an interest in the Department of Energy (DOE) uranium enrichment pricing policies and procedures. DOE, the sole supplier of enriched uranium in the United States, has three enrichment plants in operation with a fourth scheduled to begin operation in the late 1980's. Eventually these plants will be retired. According to the former Energy Research and Development Administration, the costs to restore the plant areas to their original conditions were estimated to be up to 5 percent of the capital investments in the plants, or about $570 million. This would add about $1.50 per unit of enriching services to the current DOE price of about $89 per unit, and increase the average cost of electricity to consumers by 3 mills per kilowatt hour.

DOE has no firm estimates available concerning the future cost of decontaminating and decommissioning its uranium enrichment facilities, and has indicated that, given the current capital improvement program at existing facilities, it does not expect to evaluate these costs any time in the forseeable future. It is depreciating the three existing plants through the year 2000, implying that their useful life could end as of that year. GAO believes that the Secretary of Energy should take the necessary steps to see that commercial customers' share of the estimated cost of retiring these uranium enrichment facilities is recovered in the current DOE charge for uranium enrichment services by adding a reasonable charge to its current enrichment service prices.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

Director: Daniel C. White Team: General Accounting Office: Energy and Minerals Division Phone: (301) 353-3711