The Secretary of Energy

[SOE LETTERH= EAD]

August 11, 2006

The Honorable Richard B. Cheney

President of the Senate

Washington, D.C. 20510

Dear Mr. President:

We are pleased to submit to Congress the enclosed report concerning plutonium storage at our Savannah River Site, lo= cated near Aiken, South Carolina. T= his report was mandated by Congress in section 3183 of the Defense Authorization Act for Fiscal Year 2003 (Public Law 107-314). Section 3183 directed that the Defe= nse Nuclear Facilities Safety Board (Board) conduct a study of the adequacy of facilities at the Savannah River Site for the storage of plutonium, and tha= t it submit to Congress and the Secretary of Energy a report on that study. Congress further mandated in sectio= n 3183 that not later than six months after the Board's report is submitted to Congress, and every year thereafter, the Secretary and the Board each submi= t to Congress a report on the actions taken by the Secretary in response to proposals in the report.

The Board submitted its report, "Plutonium Storage at the Department of Energy's Savannah River Site," both to Congress and the Secretary of Energy by letters dated D= ecember 1, 2003. Our first report on = the actions being taken at that time by the Department of Energy in response to= the eight proposals contained in the Board's December 2003 report was submitted= to Congress by letters dated June 16, 2004, and our second report was submitted by letters dated July 11, 2005. Our third report is enclosed.<= /o:p>

Since submission of our second report, = the Department has: (1) approved = the Mission Need for a new Plutonium Disposition Project at the Savannah River Site; (2) initiated work on this new project; (3) begun removing unnecessary combustibles from the K-Area Material Storage facility; and (4) decided to install fire protection systems in the K-Area Material Storage facility.

If you have any further questions or ne= ed additional information, please contact me or Ms. Jill L. Sigal, Assistant Secretary for Congressional and Intergovernmental Affairs, at (202) 586-545= 0.

Sincerely,

Samuel W. Bodman

Enclosure

&n= bsp;

Third Report = to Congress

On Actions Ta= ken by the Department of Energy

In Response t= o the Proposals in the

Defense Nucle= ar Facilities Safety Board's

December 2003 Report to Congress on

Plutonium Sto= rage at the Savannah River Site

Department of Energy

June 2006

Report to Con= gress on Actions Taken by the Department of Energy in Response to

the Proposals in the Defense Nuclear Facilities Saf= ety Board's December 2003 Report

to Congress on Plutonium Storage at the Savannah R= iver Site

Introduction

Section 3183 of the Defense Authorization Act for Fiscal Year 2003 (Public Law 107-= 314) directed that the Defense Nuclear Facilities Safety Board (Board) conduct a study of the adequacy of the K-Area Materials Storage (KAMS) facility and related support facilities at the Savannah River Site (SRS), such as Building 235-F, for the stora= ge of defense plutonium and defense plutonium materials. That statute also required that the= Board submit to Congress and the Secretary of Energy a report on that study, including any proposals the Board considers appropriate to enhance the safe= ty, reliability, and functionality of KAMS. Congress further mandated in Sectio= n 3183 t= hat not later than six months after the Board's report is submitted to Congress, and every year thereafter, the Secretary and the Board each submit to Congr= ess a report on the actions taken by the Secretary in response to the proposals= , if any, included in the report.

The Board submitted its report, "Plutonium Storage at the Department of Energy's Savannah River Site," both to Congress and the Secretary by letters dated December 1, 2003. That report presented conclusions o= f the Board's study, and identified several proposals for enhancing the safety, reliability, and functionality of plutonium storage facilities at SRS.

This report is the third one submitted to Congress by the Secretary of Energy on= the actions being taken by the Department of Energy (DOE) in response to the proposals contained in the Board's December 2003 report on plutonium storag= e at SRS.

Board's Proposals

The Board's December 2003 report contains eight proposals; two on the plutonium= disposition program, five on the suitability of facilities (one on KAMS and four on Bui= lding 235-F), and one on remote monitoring and retrieval of material. Those proposals are listed below.

Plutonium Disposition Program

Expedite the developme= nt of a complete, well-considered plan for the disposition of all excess plutonium to preclude unnecessary extended storage of plutonium at SRS= .

Conduct a new study of available options for the storage of plutonium at SRS.

Suitability of Facilities

KAMS

Install fire protection systems and eliminate unnecessary combustibles in KAMS.

Building 235= -F

Establish an acceptable safety basis for stabilization and packaging of plutonium and extended storage of plutonium in the facili= ty.

Conduct a systematic evaluation of the safety systems to deter= mine needed upgrades.

Perform a structural analysis assessing seismic adequacy measu= red by current acceptance criteria. Since the facility has a new extended mission, the structural analysis should be based on ground mo= tion equivalent to that used in the analysis for a new facility at SRS.

Decontaminate unused process cells.

Remote Monito= ring and Retrieval of Material

Develop and implement validated procedures for the handling and intrasite shipment of plutonium containers, including damaged containe= rs.

Status of Actions Taken by DOE in Respo= nse to the Board's Proposals

Plutonium Disposition Program

Board Proposal: Expedite the development of a complete, well-considered plan for th= e disposition of all excess plutonium to preclude unnecessary extended storage of plutoni= um at SRS.

DOE Actions: In order to preclude unnecessary extended storage of plutonium at S= RS, DOE plans to establish a disposition path for all plutonium at the site. In its June 2005 second annual repo= rt to Congress on SRS plutonium storage, the Board stated it believes the majorit= y of the excess plutonium could be dispositioned through use of the MOX facility= and that any remainder could be disposed of through the high level waste system= .

The Mission Need or Critical Decision-0 (CD-0), for a new Plutonium Disposition Project at SRS for plutonium withou= t an identified disposition path was approved September 6, 2005, by the Deputy Secretary. The CD-0 package w= as prepared pursuant to DOE Order 413.3, "Program and Project Management for the Acquisition of Capital Assets.= " This Order describes the disc= iplined process that DOE uses for managing capital projects and an appropriate Nati= onal Environmental Policy Act (NEPA) review will be performed as part of the project. = The Department's fiscal year 2006 budget includes $10 million for conceptual design for the new project, and work = has begun. During the coming year= , the Department will select a preferred technology alternative for disposing of plutonium n= ot suitable for use as Mixed-Oxide (MOX) fuel and begin the conceptual design. This potential new plutonium dispos= ition capability, together with the planned MOX facility and utilization of the site's existing H-Canyon facilities, would ensure that surplus plutonium st= ored at SRS has an identified disposition path out of South Carolina.

Board Proposal: Conduct a new study of avail= able options for the storage of plutonium at SRS.

DOE Actions: The Department completed an = update of the previous study of SRS plutonium storage in July 2004, and subsequent= ly decided to: (1) utilize only = K-Area for storage of plutonium, and for future stabilization and packaging operations; and (2) to deinventory Building 235-F by the end of 2006. K-Area has sufficient capacity to a= ccommodate storage of all DOE's surplus non-pit plutonium, and is considered by both t= he Department and the Board to be a robust facility that does not require significant upgrades. As a re= sult, in its June 2005 second annual report to Congress on SRS plutonium storage,= the Board stated that the study as originally proposed is no longer necessary, = but they believe the Department should consider whether a new facility is econo= mically viable. Since the Board state= d that the study as originally proposed is no longer necessary, and the economic viability of a new facility is not a safety issue when dealing with plutoni= um storage, this proposal is considered closed.

Suitability of Facilities

KAMS

Board Proposal: Install fire protection syst= ems and eliminate unnecessary combustibles in KAMS.

DOE Actions: Removal of the cable combust= ible load in the actuator tower above the KAMS facility has been initiated and w= ill be completed by September 30, 2006, thus eliminating unnecessary combustibl= es. Additionally, based on its decision= to utilize only K-Area for future plutonium storage and stabilization and pack= aging operations, the Department has decided to install fire suppression equipmen= t in the Neutron Multiplicity Counting Room in KAMS and to install fire detection equipment throughout KAMS at the earliest opportunity.

Building 235-F

Board Proposal: Establish an acceptable safe= ty basis for stabilization and packaging of plutonium and extended storage of plutonium in the facility.

DOE Actions: Based on its decision to uti= lize only K-Area for storage of plutonium and for future stabilization and packa= ging operations and to deinventory Building 235-F by the end of 2006, the Depart= ment stated in its June 2005 second annual report to Congress on SRS plutonium storage that all Board proposals related to Building 235-F were considered = closed. In its June 2005 second annual report to Congress, the Board stated that in light of DOE's decision, the Board's proposals for enhancing= the safety and reliability of this facility are no longer applicable to the extended storage mission.

Board Proposal: Conduct a systematic evaluat= ion of the safety systems to determine needed upgrades.

DOE Actions: All proposals related to Bui= lding 235-F in the Board's December 2003 report to Congress on plutonium storage = at SRS are considered closed, as stated above.

Board Proposal: Perform a structural analysis assessing seismic adequacy measured by current acceptance criteria. Since the facility has a new extend= ed mission, the structural analysis should be based on ground motion equivalen= t to that used in the analysis for a new facility at SRS.

DOE Actions: All proposals related to Bui= lding 235-F in the Board's December 2003 report to Congress on plutonium storage = at SRS are considered closed, as stated above.

Board Proposal: Decontaminate unused process= cells.

DOE Actions: All proposals related to Bui= lding 235-F in the Board's December 2003 report to Congress on plutonium storage = at SRS are considered closed, as stated above.

(Note that the holdup material in the process cells will be removed or immobilize= d as part of the decontamination a= nd decommissioning effort that will take place following deinventory of Buildi= ng 235-F).

Remote Monitoring and Retrieval of Mate= rial

Board Proposal: Develop and implement valida= ted procedures for the handling and intrasite shipment of plutonium containers, including damaged containers.

DOE Actions: In its June 2004 first annual repo= rt to Congress on SRS plutonium storage, the Board stated that DOE has complet= ed all necessary actions concerning this proposal and this action is considered closed.