WHAT IS THE COST FOR DOE LOW-LEVEL WASTE DISPOSAL? Karen Guevara U.S. Department of Energy

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1 1 ABSTRACT WHAT IS THE COST FOR DOE LOW-LEVEL WASTE DISPOSAL? Karen Guevara U.S. Department of Energy The DOE Office of Environmental Management is undertaking a comprehensive study of life-cycle disposal costs for its low-level and mixed low-level waste. This study is the most recent in a series of analyses the Department has conducted to answer questions about its policies, practices, and the costs of low-level waste disposal. It will address new questions generated by previous cost studies and will discuss opportunities for DOE to reduce the cost of low-level and mixed low-level waste disposal. With the recent publication of the Record of Decision for DOE s Waste Management Program: Treatment and Disposal of Low-Level Waste and Mixed Low-Level Waste and the flexibility it offers DOE sites in choosing a disposal site, the DOE complex is now prepared to consider the implications of life-cycle costs in implementing its waste disposal configuration. This next generation cost study will address uncertainties in disposal volumes at DOE s regional disposal sites, costs of facility closure, and impacts of long-term stewardship obligations in assessing DOE s life-cycle disposal costs. INTRODUCTION As noted in a recent U.S. General Accounting Office (GAO) report published in April 2000 (1), the Department of Energy (DOE) has acknowledged that their disposal policies, together with constraints on disposal facilities themselves and costs of disposal at commercial facilities, have limited the availability of disposal options for DOE s waste-generating sites. Of the three existing commercial disposal sites, two of them serve as low-level radioactive waste compact disposal facilities. One is already closed to generators outside the compact states, and the other will be closed to non-compact states after The remaining facility currently can accept only low-level waste (LLW) and mixed low-level waste (MLLW) that contains relatively low concentrations of radioactivity. Although the facility is in the process of modifying its permit to dispose of higher activity waste, the state in which this facility is located is considering imposing a surcharge on waste entering the state for disposal, thus increasing the cost to DOE of disposal at this site. As for disposal at DOE facilities, until the February 2000 publication of its long-awaited Waste Management Programmatic Environmental Impact Statement (WM PEIS) (2), Record of Decision (65 FR 10061) on LLW and MLLW disposal, DOE waste generating sites had been assigned to a single disposal site, either the Nevada Test Site or Hanford, based on the generating site s categorization as a defense or non-defense site. Thus, with few disposal options available, most of DOE s waste managers have had little opportunity to consider costs when making their waste disposal decisions. With DOE s WM PEIS Record of Decision and the flexibility it offers generating sites to

2 2 choose their disposal site, the DOE complex is now poised to consider the implications of life-cycle costs in implementing its waste disposal configuration. BACKGROUND Prior to 1979, DOE routinely used commercial facilities for disposal of its LLW in order to promote the development of commercial disposal facilities and to provide disposal capabilities for those DOE sites that could not dispose of wastes on site (i.e., DOE sites that had no onsite disposal facility). Between 1975 and 1978, three of the existing commercial LLW disposal facilities experienced operational problems and were required to close. State governments began to pay more attention to the three remaining commercial disposal sites located in Beatty, Nevada; Barnwell, South Carolina; and Richland, Washington. Over time, the States of Nevada, South Carolina, and Washington closed or restricted the use of the commercial facilities within their jurisdictions in order to prevent these facilities from becoming the only disposal sites for LLW generated in the United States. Subsequently, DOE developed and adopted a policy of disposing its LLW primarily at DOE sites to ensure the availability of reliable disposal capacity and to limit potential liability for claims by or against commercial disposal facility operators. The Department also began a complex-wide analysis of its waste treatment, storage and disposal configuration under the National Environmental Policy Act. Through the WM PEIS, DOE sought to define the disposal configuration for its operations-generated LLW and MLLW. Six DOE facilities dispose of operations-generated LLW: the Hanford Site in Washington State, the Idaho National Engineering and Environmental Laboratory, the Los Alamos National Laboratory in New Mexico, the Nevada Test Site, the Oak Ridge Reservation in Tennessee, and the Savannah River Site in South Carolina. In addition, DOE operates two facilities for disposal of onsite-generated MLLW, at Hanford and the Nevada Test Site. In addition, DOE began constructing the first of six planned disposal facilities authorized to receive only waste generated by environmental cleanup actions at the site where the facility is located. These cleanup actions are conducted pursuant to the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) or the Resource Conservation and Recovery Act (RCRA) corrective action provisions; and the resulting disposal facilities are called CERCLA disposal cells. Of the six planned CERCLA facilities, two are now closed, two still operate, one is approved for construction and one is in the planning stages. DOE has closed its CERCLA disposal cells (dedicated for disposal of uranium mill tailings wastes) at the Monticello facility in Utah and the Weldon Spring Site in Missouri. CERCLA disposal cells currently operate at the Hanford Site in Washington and the Fernald Environmental Management Project in Ohio. In addition, a CERCLA disposal cell has been approved for construction at the Oak Ridge Reservation in Tennessee, and a cell is being planned at the Idaho National Engineering and Environmental Laboratory.

3 3 Beginning in 1993, DOE began allowing some of its LLW and MLLW, meeting specific exemption criteria, to be disposed at commercial disposal facilities. The DOE policy on disposal of LLW and MLLW, described in the Radioactive Waste Management Manual (3), DOE M , (and previously in DOE Order A), provides that these wastes shall be disposed at the site where the waste is generated, if practical; or if onsite disposal capability is not available, at another DOE facility. The manual further states that if DOE capabilities are not practical or cost-effective, exemptions may be granted to allow DOE to send radioactive waste to commercial facilities. Although DOE relies primarily upon its own facilities for disposal of its LLW, DOE has increased its use of commercial disposal facilities in recent years, primarily due to: (1) DOE sites needs for MLLW disposal (although DOE has two MLLW disposal facilities, neither currently disposes of offsite MLLW); (2) the need to dispose of waste generated by the cleanup of sites within the Formerly Utilized Sites Remedial Action Program (FUSRAP); and (3) the cost savings of using commercial disposal sites in particular situations. In 1998, in support on the ongoing WM PEIS analyses, DOE completed an Information Package on Pending Low-Level Waste and Mixed Low-Level Waste Disposal Decisions (4). This report evaluated LLW and MLLW disposal scenarios selected as both realistic and representative of the options available to DOE for complex-wide disposal configurations. While this study provided DOE - with valuable disposal cost information (disposal facility costs, generator costs, storage costs and scenario-specific costs) for various twenty-year disposal scenarios, shortfalls of the report included: (1) no attempt to look at life-cycle costs such as facility closure and post-closure costs; and (2) no analysis of the costs associated with DOE s use of commercial disposal facilities. That same year, DOE issued a Notice of Intent (63 FR 13396) to analyze its existing policy regarding disposal of some DOE LLW and MLLW in commercial facilities, including an analysis of the cost implications of its policy. Since the Department resumed use of commercial disposal facilities in 1993, most of the waste DOE has sent to commercial disposal has gone to a single facility: Envirocare of Utah, Inc. As a result, two private entities drafted proposals to the Department, expressing interest in competing for DOE's LLW and MLLW disposal business. One of the companies pursuing business with DOE subsequently filed a suit alleging that they were being excluded from competing for disposal of DOE waste. The Commercial Disposal Policy Analysis for Low-Level and Mixed Low-Level Wastes (5), issued in March 1999, published the results of the policy analysis and evaluation of five options available to DOE: (1) continue DOE's current policy of disposal at DOE facilities and, through the exemption process, at commercial facilities; (2) discontinue use of commercial disposal facilities within three years; (3) expand DOE's use of commercial facilities by funding efforts to license new facilities; (4) expand DOE's use of commercial facilities by regulating commercial facilities under the Atomic Energy Act of 1954; and (5) dispose of all of DOE's LLW and MLLW at commercial facilities. The analysis evaluated each option against five criteria: facility capacity, implementability, cost, transportation, and

4 4 stakeholder acceptance. Based on this analysis, DOE concluded it should maintain its current policy regarding the use of commercial facilities for disposal of LLW and MLLW. On February 25, 2000, the Department put in place the last piece of a comprehensive LLW and MLLW disposal policy, naming which DOE sites would serve as LLW and MLLW disposal sites for the rest of the DOE complex. Through its WM PEIS Record of Decision, the Department identified Hanford and the Nevada Test Site as the two DOE sites to dispose of onsite plus offsite DOE LLW and MLLW. This decision provides DOE waste generating sites with new flexibility to choose their DOE disposal site, eliminating earlier restrictions to waste disposal based on defense versus nondefense categories. By eliminating earlier restrictions and making more disposal options available, DOE s waste managers now have greater opportunity to consider costs, including life-cycle costs, when making their waste disposal decisions. LIFE-CYCLE COST COMPARISONS OF ONSITE VERSUS OFFSITE DISPOSAL OF DOE LLW AND MLLW Just prior to issuance of DOE s decision about its own disposal sites, the Senate Armed Services Committee directed DOE to conduct yet another cost analysis. The committee, prompted by commercial lobbying, included in its report accompanying the National Defense Authorization Act for FY 2000 (Senate Report ) a requirement that DOE compare the life-cycle cost of onsite versus offsite disposal of LLW and MLLW. The Life-Cycle Comparison of Onsite versus Offsite Disposal of Department of Energy Low-Level and Mixed Low-Level Radioactive Waste (March 2000) (6) was prepared in response to this request. The report to Congress updated the cost information from previous studies and addressed some of their recognized shortcomings, including closure and postclosure costs. It used parametric and order-of-magnitude estimates to (1) compare life-cycle costs for disposal of DOE LLW and MLLW at DOE-owned disposal sites with the life-cycle costs for disposal of that same waste at commercial disposal facilities; (2) compare life-cycle costs of current DOE disposal methods with those that would be incurred if DOE were required to comply with U.S. Nuclear Regulatory Commission (NRC) regulations for LLW disposal; and (3) assess the impacts of DOE's policy concerning the use of commercial disposal facilities on open competition for disposal contracts at DOE sites. Three disposal scenarios were evaluated in this cost study. The scenarios, similar to those evaluated in the March 1999 Commercial Disposal Policy Analysis, spanned a continuum from disposing all of DOE's LLW and MLLW at DOE facilities to disposing of all of these wastes at commercial facilities. The range of options and waste volumes selected for this study comprised reasonable scenarios that DOE may face in the future. Life-cycle cost estimates were developed for DOE waste operations facilities, DOE CERCLA disposal cells, and for disposal at commercial disposal facilities for the amount of LLW and MLLW that will require disposal between 1998 and The study concluded that the estimated life-cycle cost of disposing all LLW and MLLW under DOE's current plans (primarily at

5 5 DOE sites but some use of commercial disposal facilities) would be $4.06 billion. The estimated lifecycle cost of disposing all DOE LLW and MLLW in DOE facilities was estimated to be $4.08 billion. The estimated life-cycle costs of disposing all of DOE's LLW and MLLW in commercial facilities was $7.09 billion. The higher cost for use of only commercial facilities was due to the cost of disposing MLLW and CERCLA cleanup wastes at commercial facilities, and the cost of transporting CERCLA wastes to commercial facilities The study also looked at whether life-cycle costs would be significantly different if DOE were required to comply with NRC regulations. The study concluded that because 10 CFR 61 regulations on the disposal of LLW and MLLW were considered in the development of DOE Order (7), there are few differences between commercial and DOE LLW disposal practices. However, there would be considerable additional administrative and implementation costs associated with demonstrating that DOE facilities meet 10 CFR 61 standards. Finally, this study evaluated the impacts of DOE's commercial disposal policy on open competition for disposal contracts at DOE sites. DOE concluded that because the current policy allows DOE to use commercial facilities when it is cost-effective, and because all disposal decisions, whether onsite or commercial, must be evaluated for cost effectiveness, it would not impact full and open competition for DOE LLW disposal contracts. FUTURE ACTIVITIES DOE s March 2000 report to Congress built and improved upon previous cost analyses. DOE expects this report to serve as the basis for yet another cost study that will include factors and uncertainties not evaluated in the previous study. As noted in earlier analyses, DOE s LLW and MLLW disposal costs have been affected by many factors. While general economic principles, such as economies of scale and increased efficiency promoted by competition, apply to the LLW disposal market there are also dynamics inherent in the economics of waste disposal that complicate the estimation and comparison of life-cycle costs of disposal facilities. Specific cost factors that affect comparisons of life-cycle costs include: (1) a commercial facility must include all costs in its disposal fees, including closure and post-closure, while DOE does not (future long-term costs are not a part of DOE's annual budget process); (2) amounts of LLW and MLLW DOE plans to dispose of are uncertain, (3) LLW and MLLW from site remediation actions have certain additional costs (e.g., characterization of the waste) that have not been considered as a part of the total disposal cost; and (4) the life-cycle costs associated with CERCLA disposal cells are comparatively low because these disposal facilities are designed to handle large volume low radioactivity wastes over a short operations period.

6 6 Other considerations to be addressed in the next study are the ramifications of the WM PEIS Record of Decision on the disposal of LLW and MLLW. The flexibility DOE generator sites now have in deciding where to dispose of wastes brings new uncertainty to projections of how much waste Hanford will dispose versus the Nevada Test Site. Life-cycle analyses of various disposal volumes at these two sites can provide information on the most cost-effective overall DOE disposal configuration. In addition, the generator sites new-found flexibility brings new challenges to ensuring disposal sites are efficiently operated and fully funded. DOE has been funding disposal site operations, in part, through charging volume-based disposal fees to its generator sites. Analysis of alternative funding mechanisms will identify those that best balance generator flexibility with disposal site efficiency. As DOE continues to refine its life-cycle data, better life-cycle cost estimates may be possible. Only recently has DOE begun to address the costs associated with closing disposal facilities. The Cost Engineering Report on Environmental Restoration Waste Disposal Facilities (8) published in February 2000, included estimates of the cost of completing the closure of CERCLA disposal cells. It is currently assumed that the cost to close DOE's disposal facilities will be comparable, but a thorough evaluation of the similarity of closure approaches and expected costs is needed. DOE has recently also begun to address the long-term stewardship of DOE sites. The results of efforts to define the long-term stewardship responsibilities and activities will improve our understanding of the costs associated with land use controls, information management, and maintenance and monitoring of closed disposal facilities and sites. CONCLUSION As noted in the GAO Report to Congress, DOE has spent over $700 million during the last three fiscal years to manage and dispose of its LLW and MLLW including the cost of managing wastes from past operations, wastes from ongoing missions, and cleanup wastes transferred from DOE s Environmental Restoration program. The GAO Report also suggests that these costs, particularly for waste storage, may have been higher than they would have been without DOE s restrictions on disposal options. Prior to DOE s issuance of its February 2000 Record of Decision, sites like Oak Ridge and Savannah River Site had no access to other DOE sites for disposal of LLW that could not meet onsite disposal facility requirements. Consequently, both continued to store LLW. In addition, before DOE s decision, only two DOE sites, Hanford and the Nevada Test Site, had access to MLLW disposal. Thus, every DOE site continued to store higher activity MLLW that could not be disposed at an existing commercial disposal facility, as currently permitted. DOE s recent decision now gives every DOE generating site a choice of two DOE disposal options. Given DOE s recent re-confirmation of its commercial policy and long-awaited decisions on its own DOE LLW and MLLW disposal site configuration, this planned cost study is well timed. The Department will build upon its most recent analyses to develop life-cycle costs for each of its disposal facilities. For the first time, these costs can reflect the use of Hanford and the Nevada Test Site as

7 7 regional disposal facilities, using the Department s most recent annualized planning data to develop timephased projections of LLW and MLLW disposal volumes and demonstrating the economies of scale possible by concentrating disposal volumes at these two sites. As DOE has done in other recent studies, facility costs then will be combined to form various DOE and commercial disposal-volume scenarios. By taking this life-cycle view, DOE hopes to understand what the least costly disposal scenarios will be based on expectations of near-term waste volumes. Resulting guidance will tell sites how to take into account the complete costs of LLW and MLLW disposal and determine whether their decisions are cost effective for the DOE complex as a whole. REFERENCES 1. GAO (U.S. General Accounting Office), Low-Level Radioactive Wastes: Department of Energy Has Opportunities to Reduce Disposal Costs, (GAO/RCED-00-64), Resources, Community, and Economic Development Division (April 2000). 2. DOE (U.S. Department of Energy), Final Waste Management Programmatic Environmental Impact Statement For Managing Treatment, Storage, and Disposal of Radioactive and Hazardous Waste, (DOE/EIS F), Office of Environmental Management (May 1997). 3. DOE (U.S. Department of Energy), Radioactive Waste Management Manual (DOE M ), Office of Environmental Management (July 9, 1999). 4. DOE (U.S. Department of Energy), Information Package on Pending Low-Level Waste and Mixed Low-Level Waste Disposal Decisions to be made under the Final Waste Management Programmatic Environmental Impact Statement, Office of Environmental Management (September 1998). 5. DOE (U.S. Department of Energy), Commercial Disposal Policy Analysis for Low-Level and Mixed Low-Level Wastes, Office of Environmental Management (March 9, 1999). 6. DOE (U.S. Department of Energy), Life-Cycle Comparison of Onsite versus Offsite Disposal of Department of Energy Low-Level and Mixed Low-Level Radioactive Waste, Office of Environmental Management (March 2000). 7. DOE (U.S. Department of Energy), Radioactive Waste Management, (DOE O 435.1), Office of Environmental Management (July 9, 1999). 8. DOE (U.S. Department of Energy), Cost Engineering Report on Environmental Restoration Waste Disposal Facilities, Office of Environmental Restoration (February 2000).