Weapons of Mass Destruction (WMD)

Mr. Chairman, Congressman Skelton, and Members of the Committee, it is a pleasure to appear before you today to discuss the Fiscal Year 1998 budget request for the Department of Energy=s national security programs. These vital programs constitute approximately two­thirds of the Department's overall budget, utilize almost 60 percent of the Department's human resources, and cover a broad range of activities that are of interest to all Americans.

In Fiscal Year 1998, the Department is requesting a total of $13.6 billion for its Atomic Energy Defense Activities accounts, which includes a request for funding in two new appropriation accounts -- the Defense Assets Acquisition Account and the Environmental Management Privatization Account. I note these accounts in particular because they represent over 20 percent of our request before the Committee this year. More important, however, they reflect a new and more effective way of doing business. I will say more about these accounts later in my statement.

First, I would like to address some of our key priorities for FY 98 among the national security programs at the Department of Energy:

1. Maintaining a safe and reliable nuclear weapons stockpile without nuclear testing, and ensuring an adequate tritium supply.

2. Reducing the global nuclear danger by aggressively pursuing non­proliferation programs, eliminating excess weapons grade materials, and safely dismantling nuclear warheads pursuant to international arms control treaties.

3. Providing for the safe and reliable operation of naval reactors, and the development of next generation reactors to meet our Navy=s needs.

4. Cleaning up former nuclear weapons sites, and addressing the complex and important issue of disposal of nuclear waste.

5. Converting Russia=s plutonium production reactors so that they no longer produce weapons-grade material, and enhancing the safety of Soviet-designed reactors utilized across the former Soviet Union.

6. Assisting workers who have been separated as a result of downsizing or restructuring our facilities.

These priorities present significant challenges ­­ each of which will require a sustained bipartisan commitment to ensure the continued success of these programs in FY 1998. As we embark on each of these challenges we must ensure that we address them in a way that protects the environment, safety, and health of our workers and the public.

STOCKPILE STEWARDSHIP AND MANAGEMENT

Maintaining a safe and reliable nuclear deterrent without nuclear testing is a firm commitment we have made to our Nation. To carry out its nuclear stockpile responsibilities, the Department has formulated the Stockpile Stewardship and Management program. The program's goal is to maintain a safe and reliable nuclear deterrent without underground testing. The program will maintain the core intellectual and technical competencies of the weapons plants and laboratories. The Department is also maintaining a test readiness capability at the Nevada Test Site and the capacity to reconstitute weapons production, consistent with Presidential Directives and Senate conditions of ratification of the START II Treaty.

Since Dr. Reis and representatives of the weapons laboratories and production plants will testify also this afternoon, I will limit my statement about Stockpile Stewardship and Management to a few key program highlights.

Last year, the Administration committed to Congress that funding for Stockpile Stewardship and Management activities would total approximately $4 billion per year for the next 10 years. Our budget request fulfills the first half of this commitment, with $20.1 billion over five years. For FY 1998, our budget request for this program totals $5.1 billion. Of this amount, a little over $4 billion would be obligated in FY 1998 with the balance obligated in future years against ongoing construction projects.

The FY 1998 request allows us to build on significant accomplishments during FY 1996 and FY 1997. DOE's production plants at Pantex, Savannah River, Oak Ridge, and Kansas City continue to support the day-to-day needs of the enduring nuclear weapons stockpile by making the necessary repairs and providing replacement parts. The National Ignition Facility (NIF) -- a powerful laser that will be a cornerstone of our Stewardship program -- completed Title I design work and has begun site preparation at Lawrence Livermore National Laboratory so that major construction can begin in FY 1998. The Accelerated Strategic Computing Initiative (ASCI) -- another key element of the Stewardship Program -- achieved a major milestone in December when a high performance computer system built for Sandia National Laboratories by Intel Corporation broke a long-standing computing barrier of one trillion operations per second. The FY 1998 program growth in the ASCI program will be used to sustain this momentum in order to increase our simulation capabilities by an additional factor of 100 by 2004.

Finally, within the Stockpile Management program the Department continues to make progress on its dual-track strategy for tritium production. Under the dual-track approach, the Department is advancing two options for the production of tritium ­­ using existing commercial light water reactors and building an accelerator to perform this mission. By late 1998, the Department plans to select an approach to be the primary, long­term source of tritium; the other would be maintained as a backup.

This dual-track approach has been reviewed and approved by the Department of Defense. Our strategy is proceeding on schedule, consistent with the Record of Decision made by the Department in December, 1995. The Department has completed detailed program plans for the accelerator. A prime contractor has been selected to work with Los Alamos National Laboratory and Savannah River to complete the design phase of the accelerator program and, if the accelerator is chosen as the primary supply option, to begin construction.

The Department has also solicited expressions of interest from a number of civilian light water reactor owners. On January 28, 1997, the Department issued a draft Request for Proposal (RFP) for comment. The RFP will trigger the first stages of a federal procurement for civilian light water reactor production of tritium. Tritium target testing is planned for late 1997 to provide necessary technical and licensing information for the civilian reactor approach.

I understand that Section 3133 of the fiscal year 1997 Defense Authorization Act requires the Department to select a tritium production option by April 15, 1997, instead of the planned decision date of late 1998. If the Department determines that it is not possible to make the decision by April 15, it is required to report to the Congress on why such a decision cannot be made. The Department intends to submit a report to the Congress to comply with Section 3133. The report will detail the status of the Department's tritium production plans, considerations that will affect a decision, and the appropriateness of advancing a decision from 1998 to 1997.

I would like to note for the Committee that the Department will forward a legislative proposal soon to the Congress that seeks to amend the Atomic Energy Act in order to facilitate the Department=s use of a commercial reactor for tritium production. We will need this Committee's help to be successful in enactment of this amendment. Congressional support for the amendment will provide an important signal to the commercial reactor owners whose participation in the tritium program is necessary to prove the ultimate viability of the reactor option of the dual-track program.

I also note that the Fast Flux Test Facility at the Hanford site in Washington is being maintained in a standby condition, while any future role it may have in the Department's tritium production is evaluated.

NONPROLIFERATION

Let me turn now to some of the upcoming challenges facing us in the area of nonproliferation. The worldwide proliferation of Weapons of Mass Destruction (WMD) has emerged as one of the most serious dangers confronting the United States. Our responsibility to reduce the danger to U.S. national security from such weapons involves preventing the spread of WMD materials, technology and expertise; detecting the proliferation of WMD worldwide; reversing where possible the proliferation of nuclear weapons capabilities; and responding to emergencies. At the Department of Energy, we draw upon 50 years of science and technology expertise resident throughout the DOE National Laboratory complex to help us achieve these goals.

I would like to highlight some of our key programs in the area of nonproliferation. In 1994, the Department established the Material Protection, Control and Accounting (MPC&A) program in the former Soviet Union (FSU) to provide enhanced protection and security for weapons-usable nuclear materials in FSU facilities, cooperatively strengthen indigenous MPC&A systems, and develop more effective standardized regulatory systems. The U.S. has a vested interest in preventing nuclear weapons materials from falling into the hands of terrorists or rogue states. Since 1994, the Department has made great progress in this program: we are working with the Russians to secure hundreds of tons of weapons-usable material at some 40 sites throughout the former Soviet Union. In FY 97, our work will expand to include cooperation at all known facilities in the FSU that contain weapons-usable nuclear material. Our FY 97 program will also encompass work to improve protection and control of nuclear materials during transportation between sites, and work with the Russian Navy and icebreaker fleets in securing fresh naval reactor fuel. By the end of FY 98, we expect to have completed work at 25 facilities. We will also continue the critical and time urgent projects that remain ongoing at other sites.

DOE and its personnel are actively involved in other key nonproliferation activities. In North Korea, we are securing spent fuel previously destined for the North Korean nuclear weapons program. We are also working with the International Atomic Energy Agency to improve the international safeguards regime and bring fissile materials excess to U.S. national security needs under safeguards. In addition, we are pursuing programs which seek to limit the use of fissile materials worldwide, establish transparent and irreversible nuclear arms reductions, strengthen the nonproliferation regime, and control nuclear-related exports.

In FY 97, this Committee was instrumental in directing the Department to apply the skills of the DOE national laboratories to fighting chemical and biological proliferation threats. DOE has made rapid progress in establishing a Chemical and Biological Nonproliferation Program that emphasizes the development of technologies to detect, characterize, and facilitate decontamination of chemical and biological threat agents. We have worked extensively with other executive branch agencies and the Department=s national laboratories to ensure that critical shortfalls in the U.S. Government=s capabilities are addressed. In FY 97, the DOE program includes the development of a new class of biological agent detectors to identify trace amounts of deadly pathogens. Early identification of such pathogens is essential to enable the application of life saving defensive measures -- both on the battlefield and in the event of an attack on civilian populations. We are also developing novel decontamination techniques for civilian application, and computer codes to model how terrorist attacks might be carried out in order to minimize their potential consequences.

The Department=s Chem-Bio nonproliferation program supports users in multiple agencies, including the DoD and the Intelligence community -- but it is primarily focussed on activities that will support law enforcement=s efforts to address chemical and biological terrorism. In FY 98, the Department plans to expand its detector development efforts, and to upgrade DOE=s existing capability to predict how biological and chemical agent clouds disperse upon attacks on population centers.

MATERIALS DISPOSITION

In the aftermath of the Cold War, significant quantities of weapons­usable fissile materials have become surplus to national defense needs both in the United States and Russia. The danger exists not only in the potential proliferation of nuclear weapons, but also in the potential for environmental, safety and health consequences if the materials are not properly safeguarded and managed. With additional funds provided at the urging of this Committee, DOE is working with Russia on options for disposition of that nation's substantial plutonium stockpile in a manner that precludes reuse in nuclear weapons.

To accomplish these objectives in FY 1998, the Department requests level funding of $103.8 million for Fissile Materials Control and Disposition activities. This will allow the program to continue consolidation of long­term storage by completing the shipment of Rocky Flats plutonium pits to Pantex, and to support facility design work for Savannah River and Pantex. The funds requested will also support continued progress on efforts to dispose of highly enriched uranium; completion of site­specific environmental reviews; site(s) selection for plutonium disposition; completion of conceptual design for a facility that would convert plutonium pits from nuclear weapons into a form suitable for international inspection and disposition; completion of process development for disposing of plutonium in reactors; R&D on disposition technologies; and the continuation of small-scale demonstrations with Russia and other nations.

NAVAL REACTORS

The Naval Reactors Program is responsible for the safe and reliable operation of over 120 reactor plants in the Navy=s nuclear powered warships, and development of new reactors to meet the Navy=s needs. As a measure of the Program=s significance, these ships account for over 40 percent of the Navy=s combatant fleet. As a further measure, the Program is responsible for more reactors than the entire U.S. commercial nuclear power generating industry, and almost as many as the next three largest commercial nuclear power generating nations combined (France, Japan, and the U.K.).

Given this significance, I am very pleased to note the Program=s impressive record of success in all areas -- technical, safety and environmental. For example, Naval reactors have accumulated over 4,800 reactor-years of operation without a reactor accident or release of radioactivity having a significant effect on the environment. Put another way, the Navy=s nuclear powered warships have safely steamed over 110 million miles during more than 40 years of world-wide operation.

In FY 1998, in furtherance of this record, Naval Reactors will continue development efforts to ensure reactor plant service lives meet the Navy=s goals for extended warship operation (now up to almost half a century for aircraft carriers) and continue development of the next generation reactor plant intended for the Navy=s new attack submarine, an effort now half done and on schedule. Naval Reactors also will conduct extensive reactor plant analyses and testing to verify the safety and reliability of the numerous operating reactor plants; develop technologies to enhance quieting of future reactor plants; carry out materials development and testing; and inactivate, to the extent possible, six shutdown test reactor plants. This work -- like the record of achievements noted above -- comes from an average investment of only four percent of the Department=s funds and one percent of our staffing.

WEAPONS SITE CLEANUP

Another vital national security activity, in which this Committee has been closely involved, is cleaning up the legacy of the Cold War nuclear weapons program. I understand that the Committee will be receiving testimony later today from Mr. Al Alm, our Assistant Secretary for Environmental Management. I will describe only a few of our program highlights, and would like to defer a more detailed discussion of the Department=s cleanup program to Mr. Alm=s testimony.

The Department now is achieving "on the ground" results under a program that is far more cost­effective than it was four years ago. For example, at the Savannah River Site in South Carolina the Department deployed three new technologies to achieve a 75 percent increase in the removal of organic solvents, including more than 90,000 pounds removed from soil and groundwater within one area of the site. At the Oak Ridge Reservation in Tennessee, the Department's cleanup program has capped 121 contaminated acres, remediated 38 acres of radioactively contaminated collection ponds and incinerated over 1.5 million kilograms of waste. DOE has had similar success treating and disposing of the tons of waste generated and stored from over 40 years of weapons production. The risk of explosions from the liquid wastes in the tanks at Hanford, Washington has been greatly reduced. Waste processing is ongoing at the Savannah River Site, culminating in pouring 100 canisters of vitrified waste at the Defense Waste Processing Facility to date. In addition, materials that the Defense Nuclear Facilities Safety Board identified as a near-term hazard are being stabilized in the canyon facilities.

I am committed to having the Department complete remedial actions at many sites over the next decade, and with sound management and financial practices, move closer to the day when cleanup and waste management activities are no longer required. In all of these activities ­­ as well as our stockpile stewardship and management work ­­ the protection of workers, the public and the environment will be essential.

NEW APPROPRIATION ACCOUNTS

I would like to say a few words at this point about the request for funds within two new appropriation accounts. Nearly all of the increase in the funds requested for National Security Programs in FY 98 is the result of two changes in the financing of construction projects. The first increase of $1.5 billion would fund fully the ADefense Assets Acquisition Account@ at $2.2 billion for FY 1998. The establishment of this account reflects a change in how construction project funds are requested, and brings the Department in line with the current practices of other agencies such as the Department of Defense. For the first time the Department is seeking full funding for construction projects that are now in the pipeline ­­up front, rather than incrementally.

We have also requested $1.0 billion in FY 98 funds in a second new account -- the Environmental Management Privatization Account. This account would allow the Department to expand the privatization pilot within the Environmental Management program begun last year.

The concepts of results­oriented budgeting, up­front construction funding, and innovative privatization projects incorporated in this budget request are consistent with the President=s goals to reinvent the way the government does business. Let me add a few more words about each of these very important new accounts.

Treatment of Future Construction Costs (Defense Assets Acquisition)

The Department=s budgeting for future defense-related construction requires $1.5 billion in additional budget authority this fiscal year. This request provides full, up­front authority for the total cost of multi­year construction projects. This does not accelerate current construction plans or change the way projects were originally intended to be executed. Thus, no outlays from this budget authority will occur in FY 1998.

Full construction funding solves two problems that occur with incremental project funding. The full funding approach allows the Administration and the Congress to decide on the merits of a project knowing its associated full costs and then to budget accordingly. Often federal construction projects begin with a small request which may not reflect the government=s total obligation to be paid down the line. Requesting total expected costs up­front enables more efficient management with fewer construction stops and delays that might occur if funding is interrupted. Further, it makes it easier to hold project managers accountable for delivering completed construction projects on schedule and within their original estimated cost.

EM Privatization Initiative

The Department began a pilot last year to radically change our approach to the cleanup of nuclear weapons production sites. In FY 1997, a total of $330 million was appropriated. The Department is requesting a total of $1.0 billion in budget authority this year to expand the privatization initiative.

Twelve projects have been identified as part of the FY 1998 privatization program. For these projects, the Department will contract with private parties to construct facilities to deliver materials processing services in later years. After the privately constructed facility is operating to the government=s specification, the Department will pay for waste processing services as they are provided. The $1.0 billion in budget authority in this year=s request is necessary for the Department to enter into privatization contracts. Outlays will not result until later fiscal years when the private sector delivers the services. The $1.0 billion in budget authority in this year=s budget request is intended to reflect the government=s firm commitment to the privatized projects. With this authority, it is expected that private firms will be more willing to enter into this kind of partnership with the government to construct waste processing facilities.

In comparison to the current government­centered approach to cleanup, it is our strong belief that privatization should accelerate completion of cleanup projects and reduce total taxpayer costs. Privatization holds the potential to move the government out of a part of the construction and facility management business, and further benefit taxpayers by shifting most of the risk and responsibility for construction and operation of these facilities to the private sector. We recognize, however, that this is an innovative approach and we will work closely with you to ensure that the privatization concept yields all the benefits we believe are possible.

NUCLEAR ENERGY

The Department is requesting $81.0 million for nuclear energy programs from within the Defense Accounts in FY 1998, a $12.5 million increase from the FY 1997 comparable level. This request includes efforts to reduce the risk of nuclear accidents in the former Soviet Union and to continue efforts at Argonne National Laboratory-West to demonstrate the application of electrometallurgical technology to treat sodium-bearing spent fuel.

Since 1992, the Office of Nuclear Energy has led the Department=s efforts to develop a nuclear safety infrastructure and establish a safety culture at power plants in Russia, Ukraine, and other countries in the region. The goal of the Department=s International Nuclear Safety Program is to help prevent the occurrence of a devastating Chornobyl­type accident that could undermine fragile emerging democracies and cost the U.S. and its allies -- both in dollars and regional security.

For International Nuclear Safety activities, the request of $50.0 million will continue the Department=s effort to reduce the national security and environmental threats posed by the operation of risky Soviet designed nuclear power plants. In FY 1998, this program will continue to cooperate with host countries to improve the physical condition of Soviet designed reactors ($16.5 million) and to establish sound operating procedures and responses to operational abnormalities ($17.5 million). The Nuclear Security request of $4.0 million will continue spent fuel management activities related to breeder reactors and other international cooperation efforts. Core conversion activities will be funded from a transfer of funds expected from the Department of Defense.

In FY 1998, $2.0 million is requested to support activities relating to the shutdown of the Chornobyl nuclear power plant. This activity is part of a much larger U.S. program, funded through the Agency for International Development and carried out by the Department of Energy, to assist Ukraine in dealing with problems associated with the shutdown of the Chornobyl nuclear power plant. The Department also leverages its unique technical expertise to meet U.S. national security goals by helping to convert Russia=s plutonium production reactors so that they no longer produce weapons-grade material. This effort is funded out of the Cooperative Threat Reduction Program.

ENVIRONMENT SAFETY AND HEALTH

Mr. Chairman, I need not remind the members of this committee that the end of the Cold War left the Department facing serious environment, safety and health concerns which pose serious threats to current and future workers and the public. The Office of Environment, Safety and Health is the Department of Energy=s major source of technical talent in all issues related to protection of the safety and health of worker and communities near DOE operations. That Office is modeled after a safety office in a major, first class corporation -- an independent office that reports directly to the chief executive officer on matters of environment, safety and health. The best performers in the private sector have recognized that such an internal safety organization is the key to safety and credibility with the public.

In FY 98, the Department is requesting $54 million from within defense accounts for the Office of Environment, Safety and Health for oversight activities, health studies, and the Radiation Effects Research Foundation. The most significant change in FY 1998 is an increase of $6.7 million for the defense-funded Health Studies program ($25.5 million). These funds will be used to support studies of radiation health effects and the environmental and occupational health impacts of the Department=s operations, including medical surveillance of former workers, continuation of U.S.­Russian studies of contaminated regions, identification of occupational health concerns, and $6.8 million to continue the Marshall Islands medical surveillance program.

Also requested is $14.5 million for the Radiation Effects Research Foundation to continue to monitor the effects of radiation resulting from atomic bombings.

WORKER AND COMMUNITY TRANSITION

The Worker and Community Transition program was established to assure the fair treatment of workers and communities affected by the Department of Energy=s changing missions after the Cold War. By the end of FY 1998, the Department projects a contractor workforce total of 96,000, a decrease of 52,686 from the highest contractor employment level at the end of FY 1992. In FY 1998, the Department requests $70.5 million for Worker and Community Transition. Of this request, approximately 53 percent of the funds will go toward workforce restructuring requirements, 40 percent will provide community transition assistance, and 7 percent will support program direction. In FY 1998, the office of worker and community transition will perform the asset management function previously performed in the Office of Policy to better coordinate the Department=s enhanced effort to dispose of surplus assets and generate revenue for the federal government.

OPENNESS

Before I conclude, I would like to say just a few words about continuing the Department=s progress on Openness. DOE has made great progress in declassifying information, enhancing public participation in the Department=s decision making, while maintaining protection of information and facilities that are truly sensitive. These actions have earned the Department greater public trust which is so necessary for success in all of its missions.

Mr. Chairman and Members of the Committee, I want to again emphasize the importance of the Department=s national security responsibilities. I ask for your support in sustaining the budget for these critical programs in FY 1998, and I look forward to working with you to ensure the continued success of these programs in the year ahead.