Executive Summary. If the current NNSA plan goes forward, total new expenditures between 2010 and 2015 would be at least $6.7 billion.

Transcription

1 Nuclear Bailout: The Costs and Consequences of Renovating the U.S. Nuclear Weapons Complex By William D. Hartung Director, Arms and Security Initiative New America Foundation May 2009 Executive Summary Despite President Obama s recent pledge to seek a world free of nuclear weapons, the Department of Energy s National Nuclear Security Administration (NNSA) is proposing a major upgrade to the nation s nuclear weapons complex. If the United States invests in a state-of-the-art nuclear weapons complex capable of producing thousands of new warheads over time, it will undermine confidence in any U.S. policy aimed at dramatically reducing or eliminating nuclear weapons. A major element of the NNSA s modernization plan is the proposal to build three new nuclear weapons facilities one in Oak Ridge, Tennessee, one in Los Alamos, New Mexico, and one in Kansas City, Missouri at a cost of up to $6 billion. The Obama administration s FY 2010 budget projects initial costs for these facilities at $1.1 billion between now and If the current NNSA plan goes forward, total new expenditures between 2010 and 2015 would be at least $6.7 billion. Total costs for renovating and sustaining the complex over the next two decades could reach $175 billion or more. Costs of the NNSA s modernization plan are hard to predict because of the agency s consistent record of large cost overruns on major projects. According to a recent assessment by the Government Accountability Office, six NNSA projects initiated during the past decade had cumulative cost overruns of $5.6 billion. The NNSA has refused to consider a well-crafted alternative the curatorship option that would maintain the reliability of the U.S. nuclear weapons stockpile while cutting the NNSA s $6.4 billion annual budget by $2.3 billion in 2010 and by two-thirds by

2 Introduction The Department of Energy s National Nuclear Security Administration (NNSA) has been pressing for an upgrade of the U.S. nuclear weapons complex. In December 2008, this effort culminated in the release of a final Supplementary Programmatic Environmental Impact Statement (SPEIS) on the modernization effort, referred to by the agency as Complex Transformation. The release of the final SPEIS was followed by the publication of two official records of decision (RODs) that chart a course for the weapons complex over the next two-anda-half decades, pending any changes required to align the plan with the Obama administration s forthcoming Nuclear Posture Review, due in late 2009 or early If the posture review is in line with President Obama s pledge to seek a world without nuclear weapons reiterated most recently in an April 2009 speech in Prague and in a statement circulated at a May 2009 United Nations meeting on strengthening the Non-Proliferation Treaty (NPT) a smaller, more streamlined weapons complex would be required to support an arsenal that will be shrinking dramatically over the time period covered by current NNSA plans. But it remains to be seen whether the agency will adopt this approach. One indication that NNSA s current approach is out of sync with the direction being pursued by the president is that it is essentially the same as the plan that had been developed before Congress de-funded the Reliable Replacement Warhead (RRW), a proposed new nuclear warhead. It stands to reason that absent the requirement to build a new nuclear weapon, a smaller weapons complex will be required. Yet so far the NNSA has denied this reality. In recent congressional testimony, Thomas D Agostino, the current acting administrator of the National Nuclear Security Administration, argued that a new multi-billion-dollar Uranium Processing Facility (UPF) would be needed whether we have a stockpile of zero weapons or a stockpile of thousands of weapons. 1 NNSA officials have also made extravagant claims about the savings to be gained from modernizing the complex, suggesting that savings in areas like energy use and the provision of security will more than offset the investments needed to build and operate new weapons facilities. But these claims appear to be contradicted by analyses conducted by the agency s own economic consultants, detailed below. What Is Complex Transformation? The U.S. nuclear weapons complex consists of eight major sites, each of which plays a unique role in the development and maintenance of nuclear warheads. In congressional testimony, then deputy administrator for defense programs at the NNSA Thomas D Agostino gave the following summary of the complex (the location of each facility added): Today s nuclear weapons enterprise consists of eight, geographically separated sites that comprise the R&D and production capabilities of the complex. There are three nuclear weapons design laboratories: Los Alamos National Laboratory (LANL) [Los Alamos, New Mexico], Lawrence Livermore National Laboratory (LLNL) [Livermore, California], and Sandia National Laboratories (SNL) [Albuquerque, New Mexico]. In 2

3 addition, numerous R&D activities, including sub-critical experiments, are carried out at the Nevada Test Site (NTS)[35 miles north of Las Vegas, Nevada]. The production complex, which has undergone significant downsizing since the end of the Cold War, consists of the following one of a kind facilities: the Y-12 Plant (uranium and other components)[oak Ridge, Tennessee], Pantex Plant (warhead assembly, disassembly, disposal and HE [high explosives] components)[amarillo, Texas], Kansas City Plant (KCP)[Kansas City, Missouri], and Savannah River Site (SRS)(tritium extraction and handling)[savannah River, South Carolina]. In addition, production activities for specific components occur at two national labs: Sandia (neutron generators) and Los Alamos (plutonium/beryllium parts, detonators). 2 Initially, many analysts and key members of Congress like Representatives David Hobson (R-OH) and Pete Visclosky (D-IN) had expected the NNSA to come up with a plan that would consolidate the nuclear weapons enterprise at fewer than the current eight sites, but that has not been the case. 3 Instead, the final SPEIS and the records of decision call for continuation of essentially the same work at the same locations, with the difference that in many cases the floor space involved will be reduced by dismantling excess or outmoded buildings and consolidating the spaces within which special nuclear materials (plutonium and highly enriched uranium) are utilized and stored. 4 The most costly elements of the NNSA s modernization initiative for nuclear weapons complex are plans to build three new nuclear weapons plants: a Uranium Processing Facility (UPF) at the site in Oak Ridge, Tennessee; a new factory for making the nonnuclear components of nuclear weapons in Kansas City, Missouri; and the Chemical and Metallurgical Research Replacement-Nuclear Facility (CMRR-NF) for fabricating the plutonium pits that are needed to trigger a thermonuclear explosion in a nuclear warhead. The CMRR-NF would be based at the Los Alamos National Laboratory. The Department of Energy s FY 2010 budget calls for spending $1.1 billion on these facilities over the next five years. Total costs for completing the facilities could reach $6 billion or more. 5 As noted above, missing from the NNSA s blueprint is any effort to consolidate facilities at fewer than the current eight nuclear weapons sites, a prospect that had been at least considered during the development of the Supplemental Programmatic Environmental Impact Statement, albeit only under pressure from key members of Congress. The Government Accountability Office (GAO) has suggested that the NNSA s proposed approach represents not transformation, but modernization in place. One advocate of scaling back plans for upgrading the weapons complex is Philip Coyle of the World Security Institute, a former associate director of the Lawrence Livermore Laboratory with 33 years of experience working in the nuclear weapons complex. In recent testimony before the Subcommittee on Energy and Water of the House Appropriations Committee, Coyle noted that the decision not to proceed with the Reliable Replacement Warhead will impact significantly the planning for NNSA s Complex Transformation effort, and also will reduce the overall cost, since future production capability can be reduced. This is particularly true for plutonium pit production that NNSA has been planning at higher than 3

4 required levels. As Coyle suggested, Now that the Obama administration has made a decision to halt the RRW, the production workload for the complex can be cut in half. 6 One of the most vigorous proponents of delaying construction of new nuclear weapons facilities is Everet Beckner, former deputy administrator for defense programs at NNSA (the official in charge of overseeing the nuclear weapons complex). In recent congressional testimony, he suggested delaying or forgoing each of the major new elements of NNSA s proposed Complex Transformation: The Congress has indicated that it will be unwilling to consider any of those decisions [from the December 2008 RODs] until a new NPR [Nuclear Posture Review] is issued and NNSA has aligned its programs to be consistent with that NPR. This leaves the NNSA with a complex that is too large and too expensive to operate [emphasis added]. 7 Beckner recommended going ahead with smaller projects obviously required by the smaller stockpile, while suggesting that large projects which have longer payback periods could wait until Congress is satisfied that they are consistent with the new NPR. This would entail holding off on the UPF, the CMRR-NF, and the Kansas City Plant. In fact, according to Beckner the reduced workload at the Kansas City Plant [would] bring into question the need for the proposed third party financed manufacturing facility at that site. The third party financed facility refers to a unique arrangement under which a private developer would build the facility and lease it back to the U.S. government s General Services Administration for a period of 20 years. The lease costs would in turn be paid out of the National Nuclear Security Administration s annual budget. The development of a privatized nuclear weapons facility raises a host of questions, not least of which is accountability. Under the leasing arrangement, the NNSA would commit taxpayers to an expenditure to be paid out over the course of two decades. Normal procedures would require a year-by-year approval of financing for the facility. 8 In early April just a few days after President Obama s speech calling for a world free of nuclear weapons a private developer was chosen to move forward on construction of the Kansas City facility. 9 Given the movement toward a radically smaller nuclear stockpile, and with experts like Beckner questioning the need for the new Kansas City Plant, the question becomes what the U.S. government would have to do to cancel the lease arrangement and halt the development of a new facility. Initial Estimates of the Costs of Complex Transformation The first rough estimate of the cost of a transformed nuclear weapons complex appeared in a report of the Secretary of Energy s Advisory Board (SEAB), published in The report suggested that sustaining the current complex through 2030 would cost about $168 billion in 2009 dollars. 10 A complex transformation in place option, involving minimal changes to existing production facilities but including development of the Reliable Replacement Warhead, was estimated by the advisory board to cost slightly more than a steady-state approach, or about $175 4

5 billion (in 2009 dollars) over the next 20 years. 11 The NNSA s current plan parallels this option, at least with respect to infrastructure. Absent a dramatic policy shift, there is no prospect that the new warhead will be developed. The SEAB study also includes a proposal for a revolutionary complex transformation, which would include a consolidated nuclear production complex that would place all activities related to highly enriched uranium and plutonium pits for nuclear warheads in one place (pits are the devices that trigger the explosion in a nuclear warhead). The advisory board argued that this option would actually save $15 billion over the steady-state case, presumably as a result of increased energy efficiency, lower security costs, and other benefits of consolidation of the complex. However, the SEAB report notes that the savings would not accrue immediately. In fact, for the first 10 years of the plan, expenditures would increase by $10 billion over the steady-state case; the projected savings of $25 billion would occur between 2016 and While the SEAB estimates are useful as background to the question of what a transformation of the nuclear weapons complex might cost, the methodology used as noted in the report s brief appendix involved a pair of relatively new, and as yet unvalidated, financial analysis tools provided by LANL [Los Alamos National Laboratory] and LLNL [Lawrence Livermore National Laboratory]. In short, these are at best very rough estimates. Recent Cost Projections: NNSA s Consultants Speak After several years during which the NNSA released no official estimates of the costs of modernizing the nuclear weapons complex, the agency commissioned a series of cost studies from the consulting firm TechSource, Inc. The reports were released between December 2007 and September 2008, and covered various aspects of the complex, from operations involving special nuclear materials (plutonium and highly enriched uranium) to high explosives assembly and testing, to flight testing. Many of the scenarios explored in these studies do not match up closely with the actual course the NNSA has chosen to take. However, there is one option (explained below) that does appear to be a reasonable facsimile of NNSA s current plan. One of the most interesting findings of the whole range of studies undertaken is that to the extent that cost savings are projected as a result of modernizing the weapons complex, they could take 10 to 20 years to be realized. In the meantime, the costs of running the complex while simultaneously building new facilities would be substantially higher than the current level of expenditures. This tracks closely with the findings of the SEAB report. The series of four TechSource reports released by the NNSA in December of 2007 represent the most detailed estimates to date of the costs of complex transformation. The four reports cover the following areas: 5

6 1) Special Nuclear Materials 2) High Explosives Research and Development Facilities Consolidation 3) Flight Test Facilities 4) Major Environmental Test Facilities Special Nuclear Materials (SNM) The production, handling, transportation and storage of highly enriched uranium and plutonium for use in nuclear weapons currently costs the NNSA $1.8 billion a year, with $300 million devoted to new construction and $200 million for transporting materials from one nuclear weapons site to another. This represents less than a third of the NNSA s total nuclear weapons budget of approximately $6.4 billion a year. 13 In its December 2007 report on this matter, TechSource calculated that a modernization plan involving major new facilities construction would cost $42 billion over a 23-year period. 14 While the TechSource report spells out 14 different modernization scenarios and estimates medium- to long-term costs for each option, only one of the scenarios closely corresponds to the option chosen by NNSA in its December 2008 record of decision. It is option IIA, described as follows: Level IIA. Build a Chemistry and Metallurgy Research Replacement-Nuclear Facility (CMRR-NF), enlarged by two modules from the original plan at LANL. Also build the Uranium Processing Facility (UPF) at Y For reasons that are not entirely clear, the NNSA neglected to include the construction of a new nuclear weapons plant in Kansas City in its Complex Transformation environmental impact evaluation. But given NNSA s determination to proceed with a new Kansas City plant, full cost estimates for the upgrade of the complex will necessarily include the costs of the new Kansas City facility. While it is difficult to determine from the December 2008 ROD documents and the December 2007 TechSource report precisely how closely the NNSA s final records of decision and TechSource s projected scenarios coincide, they each involve construction of the same two major facilities and are treated as similar plans for the purpose of gauging the rough costs of NNSA s Complex Transformation plan. The major capital costs for option IIA are an estimated $6.2 billion, to be expended between 2010 and This cost rises to $6.7 billion once the Kansas City plant is included. 6

7 YEARS Table 1. Projected Net Costs of Modernizing Capabilities for Plutonium Pit and Highly Enriched Uranium Production, FY 2008 through FY 2019 a (modernization versus steady-state alternatives) billions of dollars TOTAL Modernization $4.4 $5.46 $6.23 $5.95 $4.52 $3.59 $30.15 (Option IIA) b Steady State (No Action) $3.85 $3.76 $3.93 $3.8 $3.57 $3.56 $22.47 Difference $.55 $1.7 $2.3 $2.15 $.95 $.03 $7.68 SOURCE: TechSource Incorporated, Independent Business Case Analysis of Consolidation Options for the Defense Programs SNM and Weapons Production Missions, Prepared for the U.S. Department of Energy, National Nuclear Security Administration, Office of Transformation, December 2007, pp. E45 and E49. High Explosives Research and Development and Production While special nuclear materials are directly related to the creation of the thermonuclear reaction that represents the ultimate explosive power of a nuclear warhead, there are a series of complex nonnuclear processes and components that support the ability of the warhead to detonate as designed. High explosive (HE) capability is one of those support systems. As summarized by TechSource, there are five sites within the nuclear weapons complex where HE activities are carried out: Lawrence Livermore National Laboratory (LLNL) and Los Alamos National Laboratory (LANL) perform most of the R&D related to main charge explosives. Sandia National Laboratories (SNL) focuses on the smaller non-nuclear explosive components (i.e., gas generators, igniters, actuators, spin rocket motors, and detonators) that use primary and secondary explosives, propellants and pyrotechnics, as well as on hazard assessments for the total weapon system. The Pantex (PX) Plant produces HE parts for the stockpile and conducts limited R&D, principally for process development, safety, and quality control a Figures in the table do not include the estimated $500 million to build a new nuclear weapons plant in Kansas City. b The Modernization Option (Option IIA) includes construction of a new Uranium Processing Facility (UPF) and a new plutonium pit production facility. 7

8 purposes, in addition to extensive manufacturing. The Nevada Test Site where large and hazardous experiments are performed maintains several specialized facilities for HE assembly and hydrodynamic experiments but does not conduct HE R&D. 16 The records of decision regarding Complex Transformation call for relatively minor changes in HE work within the nuclear weapons complex. Activities would continue at all of the five existing sites now engaged in HE research, development, and production/manufacturing, but with a smaller footprint for that work within each site. This option is referred to in the TechSource report as the downsize-in-place alternative. A no action alternative involving minimal changes would cost an estimated $1.37 billion for the period between 2007 and 2030, while the downsize-in-place option would cost $70 million less, a savings of about $3 million a year through The TechSource analysis explains its savings estimate in terms of the lesser expense of operating facilities with smaller overall floor space: The downsize-in-place options are generally less expensive than the no-action alternative, and are also less expensive than almost all of the consolidation alternatives. This result is intuitive because present facilities are not replicated to take on HE R&D experiments received from other sites. Space has been or is in the process of being downsized, leading to an overall decrease in facility square footage. This decrease in square footage is the primary driver of cost reduction under these alternatives because fewer square feet must be operated, maintained, and recapitalized over the 2030 and 2060 time periods, compared to the no-action alternative. 18 It is interesting to note that the savings are relatively small over the 23-year period about 5 percent over more than two decades. Any modest upward changes in the costs of building and reconfiguring HE operations at any of the five affected sites would most likely eliminate these projected savings, or possibly even make the downsize-in-place option more expensive than the no action option. Add to this the fact that the changes at each site will involve a combination of dismantling and renovating existing facilities and building new ones, and it is likely that the costs of downsizing in place will exceed those of the status-quo option for the next decade or more. Major Environmental Test Facilities (METFs) Briefly put, major environmental test facilities play a major role in weapon design, certification, and surveillance. 19 They subject warhead components to a variety of harsh conditions as a way of determining whether existing warheads will function as designed. This work is viewed as being particularly important in the absence of full-scale nuclear testing. Environmental testing essentially involves simulating conditions under which a warhead might be required to operate. A full description of the numbers and types of METFs is beyond the scope of this analysis, but to give some sense of what is involved it should be noted that testing regarding just one aspect performance under hostile radiation environments involves the use of over a dozen separate facilities. 8

9 Compared to other elements of the nuclear weapons complex, such as R&D and handling of special nuclear materials, environmental testing facilities are relatively inexpensive. A no action alternative for running METFs from 2007 to 2030 is estimated by TechSource to cost about $874 million, or an average of $38 million a year. 20 The no action scenario does not literally entail doing nothing but would involve modifications as needed to keep facilities operating at viable levels of performance and safety. The next level up from a no action option a modernize-in-place approach would actually cost slightly more, or $885 million between 2007 and This is most likely because the savings incurred from operating more modern facilities and equipment will not have exceeded new construction costs as of the end date (2030). The difference between a status-quo versus a modernization-in-place approach would amount to about $478,000 a year through Flight Test Facilities The TechSource report on possible future approaches to flight testing within the nuclear weapons complex provides the following summary of the importance of flight testing for ensuring the reliability of the nuclear weapons stockpile: Nuclear weapons are required to be able to function with high reliability throughout their stockpile life over the full range of conditions in stockpile-to-target sequence (STS) flight tests are necessary to evaluate a weapon s flight characteristics and the operation of nonnuclear components in operational flight environments throughout stockpile life. 21 Flight testing is a joint Department of Defense/National Nuclear Security Administration responsibility, with the DoD responsible for tests of reentry vehicles or cruise missiles, and NNSA responsible for tests of air-delivered bombs. Tests do not use complete nuclear weapons, but rather joint test assemblies that replace the explosive nuclear package with data recording equipment. NNSA s tests are conducted at the Tonopah Test Range (TTR) in Nevada. In evaluating possible alternatives for Complex Transformation, closing TTR altogether and moving all flight test to a DoD facility was an option. This approach was rejected in favor of keeping NNSA s flight testing activities at Tonopah, albeit with a reduced footprint. As a percentage of total costs, restructuring flight testing activities at TTR shows the greatest potential savings of any of the changes contemplated as part of the Complex Transformation initiative. A no action alternative would cost an estimated $318 million between 2007 and 2030, while a reduced footprint at TTR would cost $185 million over the same period, a reduction of 42 percent. 22 However, since these savings are generated from a fairly small baseline, they make a limited contribution to overall potential savings from Complex Transformation. 9

10 Tritium Research and Development Tritium is a radioactive element that is used to boost the impact of a nuclear explosion by ensuring more efficient use of the special nuclear materials that are the core drivers of the explosion. Because of its relatively short half-life of 12.5 years, the tritium in a nuclear warhead needs to be replaced periodically. Prior to the Complex Transformation process, tritium R&D was concentrated in four sites the Savannah River Site in South Carolina; the Los Alamos National Laboratory; the Sandia National Laboratories; and the Lawrence Livermore National Laboratory. The NNSA s records of decision recommended consolidating tritium R&D at Savannah River. Non-R&D activities involving tritium would still be undertaken at each of the three remaining sites mentioned above. Unlike the other changes recommended in the Complex Transformation RODs, shifting tritium R&D to the Savannah River Site would actually increase costs. While a status-quo alternative for tritium R&D would cost $329 million between 2007 and 2030, consolidation at SRS would cost $415 million over the same time period. The reason cited for the lack of projected savings was change and an upfront investment with little prospect of a real return through reduced operating expenses. 23 The Big Picture: Total Project Costs Through 2030 Each of the elements outlined thus far are building blocks that can be utilized in estimating the costs of upgrading and sustaining the nuclear weapons complex through 2030 in the context of the Complex Transformation initiative. Taken together all five activities special nuclear materials production and R&D, high explosives R&D and production, major environmental test facilities, flight testing, and tritium R&D would cost a total of $40.9 billion between 2009 and 2030, if the TechSource estimates are accurate. The vast bulk of these expenditures involve work with plutonium and highly enriched uranium. Construction and operation of a new Kansas City Plant over the same time period would add $2 billion in costs. But the activities cited above represent only a fraction of the total costs of upgrading and running the complex for the 21-year period covered in the updated version of the TechSource estimates. For example, as of 2007, special nuclear materials activities cost approximately $1.8 billion a year, or about 30 percent of the total annual NNSA weapons budget of over $6 billion. Assuming that SNM work were to remain a similar proportion of the NNSA weapons budget over the period from 2009 to 2030, total costs to modify and sustain the complex would come to $128 billion. However, the $128 billion figure which is itself a very rough estimate based on the assumption that the relationship of the different elements of NNSA s weapons budget will not change much over time is undoubtedly at the low end of the scale. Given that some major 10

11 NNSA construction projects have cost two to three times their original estimates, it is possible that up-front capital investments on special nuclear materials alone could run to as much as $16 billion from 2010 to 2019 (or, more likely, run at that cost level over a longer time span), an $8 billion increase from the TechSource estimate. This would place total costs through 2030 at over $136 billion. Cost overruns on Department of Energy and National Nuclear Security Administration projects are the norm. A May 2007 report by the GAO revealed significant cost overruns in 8 of 10 major DOE projects totaling $14 billion over their original estimates; moreover, the projects were a cumulative 45 years past their original schedules. Six of the ten were NNSA projects, which accounted for $5.6 billion in overruns, a 78 percent increase over original project estimates. The three projects with the largest percentage increases were the Mixed Oxide Fuel Fabrication Facility, the cost of which rose from an estimated $1.4 billion to $4.7 billion, an increase of over 200 percent; the Highly Enriched Uranium Fuels Facility, the cost of which rose from $251 million to $549 million, for a 102 percent increase; and the National Ignition Facility, the cost of which rose from $1.2 billion to $2.2 billion, for an increase of 87 percent. 24 Another way to make a rough assessment of the costs of Complex Transformation is to project current costs into the future. Whatever savings that may accrue due to increased efficiency including reduced security costs related to consolidating dangerous materials in smaller areas and lower energy costs from operating in newer, more efficient buildings would be offset by the new investment costs needed to achieve modernization in place. To assume that major savings can be achieved in the medium term while simultaneously operating old facilities and building new ones runs contrary to common sense. Looking 10 to 15 years down the road, the question is how long it would take for reduced operating costs to offset the substantial upfront investment involved. There are some indications from NNSA documents that even under the most optimistic scenario the bulk of real savings might not be realized until after And projections that far into the future are extremely hard to rely upon given all that can change in two decades. Projecting current budgets forward suggests a total cost to upgrade and sustain the U.S. nuclear weapons complex of approximately $134 billion for the period from 2009 to It may be recalled that the SEAB 2005 estimate put the costs of upgrading and sustaining the weapons complex under a modernization in place scenario at $175 billion, about $6 billion more than the status quo option. Therefore, the NNSA s preferred alternative for upgrading the nuclear weapons complex would likely cost at a minimum between $134 billion and $175 billion over the period While it is difficult to envision the budgetary impact of tens of billions of dollars in expenditures spread out over more than two decades, it is worth noting that the impact of Complex Transformation over the next six years will be substantial, at $6.7 billion above current budget levels. The NNSA has argued that it will achieve savings in other parts of the complex 11

12 that will partially offset the increased investment in weapons-making materials and production facilities, but it has failed to make the case that any significant savings can be had in the short term. If anything, the costs of dismantling old buildings and establishing new security perimeters could involve additional costs. Considering an Alternative: The Curatorship Approach The NNSA s current plans for transforming the U.S. nuclear weapons complex are out of step with the direction of U.S. policy. President Obama has promised to pursue deep cuts in U.S. and Russian nuclear arsenals, followed by a concerted effort to bring other nuclear powers on board a project to rid the world of these weapons altogether. Under this scenario, a smaller standby complex would make more sense. Modernizing and sustaining a nuclear weapons complex capable of producing thousands of warheads for generations to come would actually be counterproductive in an era of deep nuclear reductions, as it would signal to other nuclear powers that the United States may not be serious about getting to zero. Drawing on an observation that former senator Sam Nunn made with respect to plans to build the Reliable Replacement Warhead, Philip Coyle has argued that if the United States builds a production complex with substantially larger capacity than required to sustain intended U.S. stockpile levels, then that could also be [in Nunn s words] misunderstood by our allies, exploited by our adversaries, and complicate our work to prevent the spread and use of nuclear weapons... and make resolution of the Iran and North Korea challenges more difficult. 25 While the NNSA explicitly refused to develop an analysis that went beyond policies that might obtain for the foreseeable future by which they meant the Bush administration policy aimed at reducing the number of deployed U.S. and Russian warheads to between 1,700 and 2,200 each a future beyond the vision of NNSA planners is now here. President Obama s goal of eliminating nuclear weapons requires a different kind of weapons complex than one designed to keep thousands of warheads deployed or on reserve. While the NNSA has not explored the impact of deep nuclear weapons reductions on the size of the weapons complex, a proposed alternative does exist. The Nuclear Weapons Complex Consolidation Project, a consortium of nongovernmental organizations, has done its own analysis of what a truly transformed nuclear weapons complex might look like. Released in April, the consortium s study, Transforming the U.S. Strategic Posture and Weapons Complex for Transition to a Nuclear Weapons-Free World, starts with the assumption that 500 total warheads are more than enough to deter any potential adversary from attacking the United States with a nuclear weapon. It should be noted that this size arsenal is meant to be a stepping stone toward the elimination of nuclear weapons. However, this level of reductions would be safe to undertake even absent major action by other nuclear-armed states. 12

13 The report proposes a restructured nuclear weapons complex that could support and sustain an arsenal of 500 warheads. The central concept around which this new approach is organized is curatorship, described as follows: We recommend a more conservative approach to maintaining the existing nuclear weapons stockpile, based on ensuring that today s safe and secure warheads are changed as little as possible and only in response to documented findings that corrective action is needed to fix a component or condition that could degrade performance or safety. A key to this approach is the finding that there is no need for the United States to design any new nuclear weapons or to make major changes in existing ones.... Our strategy is based on maintaining that record by ensuring that those safe and reliable warheads are not changed in any significant manner. NNSA s mission to maintain existing weapons would rely on scrupulous surveillance and examination of warheads to determine if any component has changed in any manner that might degrade the safety or performance of the warhead. If so, that part would be restored to its original condition when the warhead was first certified to enter the stockpile. This methodology is called the Curatorship approach. 26 The report goes on to note that if a future president decided that there was a need to design and build a new warhead, a weapons complex in curatorship mode could do so. The idea in the short term, however, is to put such activities on hold. The consortium s curatorship approach would reduce the number of places involved in nuclear weapons production, surveillance, and assembly/disassembly operations from the eight current sites to three Los Alamos National Laboratory, Sandia National Laboratories, and the Pantex plant in Amarillo, Texas. The plan would also drastically cut NNSA R&D spending much of which is involved with creating a capacity to design new kinds of warheads. 27 The changes proposed under the curatorship option could cut the NNSA s nuclear weapons budget by more than half between now and 2015, from $6.4 billion in FY 2009 to $2.7 billion in FY The budget would decline further by 2020, to $2.1 billion. 28 While the report does not provide a year-by-year breakdown for costs between 2009 and 2030, it suggests that a genuine transformation of the complex could save tens of billions relative to current NNSA projections. 29 Conclusion Sustaining the nuclear weapons complex at anything approaching current levels as proposed under the National Nuclear Security Administration s Complex Transformation plan will be a costly proposition, running in the range of at least $134 billion to $175 billion over the next two decades. If the United States invests in a state-of-the-art nuclear weapons complex capable of producing thousands of new warheads over time, it will undermine confidence in any U.S. policy aimed at dramatically reducing or eliminating nuclear weapons. 13

14 Before embarking on such a course, the NNSA should be required to go back to the drawing board to come up with a plan for putting the complex on standby status in an era of sharp nuclear reductions. The curatorship approach deserves serious consideration. Others may be possible, but if so the NNSA should articulate them in some detail before receiving any additional funding for Complex Transformation. In order to ensure a thorough and objective approach, NNSA planning should be vetted by agencies and individuals with no current stake in the operations of the nuclear weapons complex, including the Government Accountability Office and a panel of independent scientific, economic, and environmental experts. Notes 1 Thomas D Agostino made these remarks during the question-and-answer period of a March 17, 2009, hearing before the Energy and Water Development Subcommittee of the House Appropriations Committee. 2 Statement of Thomas P. D Agostino, Deputy Administrator for Defense Programs, National Nuclear Security Administration, Before the House Armed Services Committee, Subcommittee on Strategic Forces, April 5, James Sterngold, Key Legislators Threaten Funds for Nuclear Weapons Overhaul; Bush Administration Abandoning Plan to Consolidate, They Say, San Francisco Chronicle, January 14, See, for example, National Nuclear Security Administration, Final Supplemental Programmatic Environmental Impact Statement on Complex Transformation, October 2008; and U.S. Department of Energy, Record of Decision for the Complex Transformation Supplemental Programmatic Environmental Impact Statement Operations Involving Plutonium, Uranium, and the Assembly and Disassembly of Nuclear Weapons, December The second ROD deals with tritium research and development, flight test operations, and major environmental test facilities. 5 U.S. Department of Energy, FY 2009 Congressional Budget Request, Volume 1, National Nuclear Security Administration, Office of the Administrator, Weapons Activities, Defense Nuclear Nonproliferation, Naval Reactors, 230, 287, 303; and FY 2010 request, Volume 1,. 79, 203, 219; and see Statement of Gene Aloise, Director, Natural Resources and Environment, United States Government Accountability Office, testimony before the Subcommittee on Strategic Forces, Committee on Armed Services, U.S. House of Representatives, Nuclear Weapons: Views on NNSA s Proposal to Transform the Nuclear Weapons Complex, July 17, 2008, 9. 6 Prepared Remarks of Philip E. Coyle, III, Senior Advisor, World Security Institute, before the House Committee on Appropriations, Subcommittee on Energy and Water, The Future of the DOE Complex Transformation Program, March 17, Dr. Everet H. Beckner, Testimony Presented to the House Energy and Water Development Appropriations Subcommittee, March 17, For a critique of plans to build a new nuclear weapons plant in Kansas City, see William D. Hartung, To Build or Not to Build? The Role of the Kansas City Plant in the Department of Energy s Plans for Modernizing the Nuclear Weapons Complex (Washington, DC: New America Foundation, October 18, 2007). 9 Kevin Collison, Developer Selection Secures Jobs at Honeywell, Kansas City Star, April 6, Secretary of Energy Advisory Board, Report of the Nuclear Weapons Complex Infrastructure Task Force: Recommendations for the Nuclear Weapons Complex of the Future, Final Report, July 13, 2005, appendix E, pp. E- 1 and E-2. The SEAB s original estimate has been recalculated into 2009 dollars, and adjustments have been made 14

15 to reflect a time period from 2009 to 2030 rather than the 2007 to 2030 time period utilized in the original SEAB estimate. 11 Ibid. 12 Ibid. 13 The $6.4 billion figure for nuclear weapons activities of the National Nuclear Security Administration is based on the FY 2009 budget. 14 Independent Business Case Analysis of Consolidation Options for the Defense Programs SNM and Weapons Programs (Santa Fe, NM: TechSource, Inc., December 2007), 9-6. All TechSource figures cited in this report are expressed in terms of Net Present Value (NPV), a technique designed to determine how much funding would be needed now to fund a given project that will be carried out at some point in the future. NPV analysis is not well suited to analyzing budgetary figures that involve year-by-year contributions from the government. In addition, an NPV figure for the total costs of modernizing and sustaining the nuclear weapons complex through 2030 involves assumptions about inflation, financing mechanisms, and savings from more efficient operations that are virtually impossible to get right (in the sense of achieving any level of accuracy) over a period projecting two decades or more into the future. That being said, the comparisons of the TechSource NPV figures for modernization in place versus a steady state option provide one insight into relative costs of the two options, and are being utilized for that purpose in this report. 15 Ibid. executive summary, v. 16 Independent Business Base Analysis of Complex Transformation High Explosives Research and Development Facilities Consolidation (Santa Fe, NM: TechSource, December, 2007), vi. 17 Ibid Ibid Independent Business Case Analysis of Complex Transformation Major Environmental Test Facilities (Santa Fe, NM: TechSource, Inc., December, 2007), Ibid Independent Business Case Analysis of Complex Transformation Flight Test Facilities, (Santa Fe, NM: TechSource, Inc., December 2007), Ibid Independent Analysis of the Tritium R&D Facility Consolidation (Santa Fe, NM: TechSource, Inc., September, 2008), United States Government Accountability Office, Report to the Subcommittee on Energy and Water Development, and Related Agencies, Committee on Appropriations, House of Representatives, Department of Energy: Major Construction Projects Need a Consistent Approach for Assessing Technology Readiness to Help Avoid Cost Increases and Delays, March 2007, Coyle, "Future of the DOE Complex Transformation Program. 26 Robert Civiak, principal author, Transforming the U.S. Strategic Posture and Weapons Complex or a Transition to a Nuclear Weapons-Free World (Nuclear Weapons Consolidation Policy Network, April 2009), Ibid Ibid Ibid