DOE criticizes Hanford contractor. Says Bechtel vit plant deadline in doubt

The Department of Energy rated Bechtel National’s performance as “satisfactory” for 2017. Bechtel is building and starting up the vitrification plant at the Hanford nuclear reservation.
The Department of Energy rated Bechtel National’s performance as “satisfactory” for 2017. Bechtel is building and starting up the vitrification plant at the Hanford nuclear reservation. Courtesy Bechtel National

The Department of Energy doubts whether its contractor is on track to start operating the massive Hanford vitrification plant by a 2022 deadline.

However, DOE has not notified the state of Washington that legal deadlines for the project are at risk, which it is required to do if the 2023 legal deadline to start operating part of the plant is at risk.

Instead, it is directing its contractor, Bechtel National, to improve its performance to boost chances that the plant will be operating by the earlier 2022 date DOE set for Bechtel.

“At this time, the Office of River Protection is concerned that BNI (Bechtel National) is not making satisfactory progress in meeting project performance expectations,” the DOE Hanford Office of River Protection said in a statement Thursday.

The issue of whether Bechtel would meet its plant operation deadlines was raised in two recent documents related to the contractor’s pay.

Contractor Bechtel National received just 48 percent of the pay it could have earned based on DOE’s subjective evaluation of its performance in 2017.

A scorecard prepared to explain the pay decision to the public listed DOE concerns, including that some deadlines were at risk of being missed.

In the second document, a letter sent March 23, DOE told Bechtel that it would not be providing any advance pay toward what the contractor could earn for its performance this year.

Bechtel has the option of requesting some of its pay early as it makes progress toward meeting contract requirements.

The letter said DOE was concerned that Bechtel “was not making satisfactory progress in meeting the project performance expectations” that it will start glassifying low-activity radioactive waste by Jan. 15, 2022.

Hanford Challenge, which obtained the DOE letter on withholding advance pay for 2018, is concerned about whether the public is being told the whole story by DOE, said Tom Carpenter, executive director of the Seattle-based watchdog group.

Bechtel’s contract requires it to start treating radioactive waste by 2022, reflecting DOE’s goal to have the plant operating before a deadline set by a federal judge of December 2023.

Construction on the plant, which is expected to cost more than $17 billion, started in 2002.

Then the plan was to start operating the entire plant in 2019. But after technical issues were raised involving high-level radioactive waste, a new plan was adopted to start treating just low-activity waste for disposal by 2023.

A melter refractory
Workers in 2014 install refractory brick in a melter at the Hanford vitrification plant’s Low Activity Waste Facility. Installation of both of the facility’s melters were completed in 2017, meeting a contract requirement for Bechtel National. Courtesy Bechtel National

The plant is being built to turn up to 56 million gallons of radioactive waste held in underground tanks into a stable glass form for disposal. The waste is left from producing plutonium for the nation’s nuclear weapons program.

The DOE letter directs Bechtel to come up with a realistic schedule for completing individual tasks to meet the 2022 deadline for the start of waste treatment. Bechtel also must have a system to identify trends before they put deadlines at risk.

Bechtel was eligible to receive $7.9 million in pay based on DOE’s evaluation of its performance in calender year 2017.

DOE rated its performance for the year in two categories, cost and project management, as “satisfactory.” The rating earned it $3.8 million, or 48 percent of pay available.

The percentage earned dropped from the previous year, when Bechtel earned 71 percent of pay available based on a DOE evaluation of its performance in 2016.

However, 2017 was the first year of a major contract revision to reflect the new focus on starting to treat low activity radioactive waste first.

The 2017 contract goals put the emphasis on meeting four deadlines to earn Bechtel $17.1 million, in addition to pay available from DOE’s subjective evaluation. Bechtel met the deadlines, which were for equipment installation, early to earn full pay.

The Department of Energy has a federal-court enforced deadline to start treating radioactive waste by 2023 at the Low Activity Waste Facility of the Hanford nuclear reservation’s vitrification plant. Courtesy Bechtel National

But in its subjective rating, DOE gave Bechtel a rating of only 40 percent in the category of “cost, schedule and efficiencies.”

Performance trends showed deadlines for starting to operate the part of the plant that will treat low-activity waste “are at risk,” the scorecard said.

It also said that a significant amount of the management reserve, the extra money budgeted to cover risks, was being spent by Bechtel.

“Management reserve is being managed by questionable processes,” which leads DOE to doubt Bechtel’s ability to meet deadlines for starting to operate the plant, the scorecard said. No additional details on management reserve were included in the scorecard.

DOE pointed out in a statement that it recognizes the challenges and significance of the current turning point of the vitrification plant project. Design and construction have been the focus of the project since 2000, and now work is shifting to preparing parts of the plant for operation.

“We have additional work to do on the annual criteria graded by the Department (of Energy),” despite meeting four contract goals, said Bechtel spokesman George Rangel. But Bechtel “is confident in the plant’s ability to begin safely treating Hanford’s tank waste as soon as 2022.”

Annette Cary: 509-582-1533, @HanfordNews