Agency makes changes to dry storage contract at INEEL

4/12/99

IDAHO FALLS, Idaho (AP) - The U.S. Department of Energy has decided to change the terms of its contract to build a new dry storage facility for spent nuclear fuel at the Idaho National Engineering and Environmental Laboratory after a lukewarm reception from potential bidders.

Those companies echoed complaints from the site's first privatized effort - cleaning up a football field-size area of buried radioactive waste at Pit 9. Potential bidders claimed companies were asked to submit fixed bids on jobs that contained too many uncertainties.

Frank Schwartz, chairman of the committee that will pick the winning contractor, said companies have been building dry nuclear storage systems for private utilities, and accepting the same financial risks, for years. But the agency listened to the feedback and decided some concerns were valid.

"We do expect the changes we've made will likely result in an increased number of bids," he said. "We also don't know that we would have been really in trouble."

The cost to build and operate the new dry storage facility is estimated to be at least $100 million. The facility would store more than 19,000 nuclear fuel elements that were shipped to Idaho after being used in commercial power and research reactors.

But bidders said it would be difficult to agree on a fixed price because of potential delays in getting a Nuclear Regulatory Commission license. Some company representatives also felt the Energy Department's original timetable was unrealistic.

The department now plans to change the contract to include reimbursing the contractor for its costs for obtaining its license, moving the deadline to complete construction from July 2003 to December 2004, and extending the deadline for companies to submit bids from April 29 to June 15.

However, officials said the contract changes do not mean the agency is abandoning its privatization efforts.

For all other phases of the dry storage work - design, construction, moving the fuel and monitoring - the winning contractor will be forced to stick to a fixed price.

"This is still a privatized contract," Energy Department-Idaho spokesman Brad Bugger said. "It's only a small piece of the contract that's being changed."