Secret Crash Report Reveals USEC Centrifuges as Rube Goldberg Machines

by Geoffrey Sea

After claiming to “invest” two billion dollars in the project but having produced only thirty-eight test centrifuges, USEC Inc. had virtually none of the technical measures, management practices, or safety culture in place to make the project safe or viable on a commercial scale. Whether USEC had the financial wherewithal to undertake a commercial centrifuge venture was also highly dubious. Those assessments come from a government-commissioned engineering report on the June 11, 2011, crash of six centrifuges at the USEC facility near Piketon, Ohio.

The report, done by Parsons Corporation as part of the Department of Energy's review of USEC's application for a federal loan guarantee, was never made public or available to Congress by USEC nor by any federal agency, and it was not disclosed by DOE to the Nuclear Regulatory Commission, which is charged with licensing and regulating safety at the facility, before NRC completed its own, less-thorough investigation in April of 2012. The Parsons report was kept secret even though USEC, allegedly a private company, has sought backing for a $2 billion federal loan guarantee and a $300 million federal bailout package, and Congress has been asked to make appropriations for USEC without benefit of the report. It is made available for Congress and the public for the first time here, courtesy of Commonwealth Environmental Services of Paducah, Kentucky, which has posted the document at my request. (CES was not my source -- I provided the document to CES for posting.)

Three months to the day after world attention focused on the loss-of-power catastrophe at the Daiichi nuclear complex, an eerily similar failure of backup electricity caused the crash of six centrifuges, and one breach, at Piketon. USEC had provided the uranium fuel then in process of melting down inside three of the Japanese reactors, and was nearing a June 30 deadline on attainment of a "conditional commitment" on the federal loan guarantee. TEPCO, the Daiichi operator now with all its nuclear reactors shut down and reporting fresh leaks of radioactive water at Fukushima, auspiciously had provided the lead potential customer endorsement for USEC's proposed "American Centrifuge Plant" in Ohio.

A "crash" in this context means the destruction of a centrifuge generally from overheating damage. A "breach" means that the outer casing was ruptured. The breach on 6-11-11 did not result in a release of uranium, only because most of the centrifuges were not running uranium at the time. This is itself an indictment of the project -- USEC was "testing" centrifuges at Piketon for almost a year without any uranium, raising the question of just what was being tested. USEC has refused to address that question.

Following the June centrifuge crash, with the Solyndra scandal breaking (Solyndra had restructured its loan in February and would file for bankruptcy in August of 2011), the U.S. Department of Energy commissioned Parsons to evaluate the causes and conditions of the June event. In October of 2011, DOE denied a loan guarantee for USEC on grounds of technical and financial inadequacy, but Secretary of Energy Steven Chu then proposed a federally funded bailout program through congressional appropriations. The House of Representatives is expected to vote on the 2013 Energy and Water Appropriations bill, including a USEC bailout provision, later today or tomorrow.

The draft Independent Engineer's Interim June-11, 2011 Incident Evaluation Report of July, 2011, was provided to me by a reliable source on condition that the source remain anonymous, in order that the report be made public and come to the attention of government investigators, as a matter of public safety. 

 A prefiguration of USEC's centrifuge operation?

Cartoon by the original Reuben Goldberg

In April of 2012 I was informed by representatives of the NRC Region 2 office, which was also investigating the 2011 USEC incident, that NRC had been unsuccessful in obtaining a copy of the Parsons report from DOE, despite requesting it, since NRC learned of the report in January of 2012. In that conversation, I offered to provide NRC a copy of the report which DOE had refused to provide. 

One business day later, apparently in response to the news that I had offered to give the report to NRC, NRC succeeded in obtaining a copy from DOE. That copy, however, was a “final draft,” which, based on a selected passage read aloud by NRC officials at a public meeting in Piketon in April, appears to have been whitewashed, with damaging statements of the July draft altered or removed. According to NRC, neither DOE nor NRC will release the final report to the public, because “it is not a public document,” despite the fact that, also according to NRC, the report is free of any classified material, prepared with the expectation of public release.

That DOE is withholding crucial unclassified documents about the USEC project from the public and from other government agencies, while simultaneously asking Congress to make appropriations in support of USEC's project, is an enormous contradiction and a challenge to the integrity of the American system of governance.

More detailed analysis of the Parsons report will be forthcoming on this blog, with only some preliminary comments sufficing for now.

The issue of financial incapacity is a critical one, as USEC sinks deeper into corporate crisis, closer to looming debt deadlines, its market capitalization plunging toward the abyss. The Parsons report, referring to an earlier Parsons study of USEC done in connection to the loan guarantee review in early 2011, states on page x-iii:

The recent IER [Independent Engineering Report] noted that USEC ...had financial considerations judged as "very significant risk."

If USEC was judged as a "very significant risk" because of financial inadequacy in early 2011, its condition in mid-2012 would have to be characterized as casket-case.

One critical fact mentioned in the Parsons report of which the NRC inspection team was not made aware is that USEC centrifuges had crashed at least twice in testing before the incident of 6-11-11, which now joins 9-11-01 and 3-11-11 (Fukushima) in the pantheon of disaster numerology. And the breach of 6-11-11 also had a precursor in another breach of an AC-100 centrifuge that occurred in 1977 as part of the Gas Centrifuge Enrichment Plant program, precursor to ACP.  On page XX-ii of Parsons it states:

The incident was unlike the previous machine crashes which were investigated by the IE [Independent Engineer] at K-1600 in February and March of this year [2011].

Who knew there had been prior USEC centrifuge crashes? Certainly not the NRC, which licenses the facility and certifies its safety. Certainly not Ohioans asked to provide political booster support for USEC. Certainly not Congress, asked to appropriate funds based on undocumented assertions of the centrifuge project's “viability.”

Mention of the K-1600 facility is also a revelation. K-1600 is a federal facility, not in Ohio, but in Oak Ridge, Tennessee, part of the old K-25 gaseous diffusion plant site. USEC pays no leasing fee for that facility, as it pays no leasing fee at Piketon. Rather, K-1600 is leased by the U.S. Air Force as a “seismic testing laboratory,” which might be considered rather odd until the obvious interest of the Air Force in subjecting uranium centrifuges to seismic shock tests is recognized. Since the Parsons report discloses that K-1600 is USEC's principal R&D testing facility in Oak Ridge, shut down since June 11, 2011, along with the Piketon Lead Cascade, we might infer that this is the key information that involved parties do not want disclosed to the public.

Such information suggests that the entire USEC operation, with its mysterious support from the clandestine National Nuclear Security Administration, is actually oriented toward providing useful information to the Department of Defense, explaining mystery contract payments to USEC that were not identified as part of any overt program. And that would explain why the clear commercial non-viability of the American Centrifuge Plant has had no effect on levels of DOE and NNSA support. ACP is simply not a civilian project, and it will have no commercial result. It is, at this point, just a military R&D project, located principally in Oak Ridge, threatened with exposure if USEC were to enter bankruptcy and liquidation.

Though the Parsons report is critical of USEC's corporate culture, management practices, worker training, financial capabilities, and overall technological competence, the report represents a lower-limit estimation of the severity of problems at USEC. Workers charged with assembly and maintenance of the centrifuges at Piketon have told this writer that they were instructed by USEC managers to not disclose certain key facts about the operation and the incident to the Parsons investigators.

A Crash Course in Duplicity

As I reported at Ecowatch.org in November, 2011, the 6-11-11 accident was immediately hushed up. Though categorized as a "24-hour event" for required regulatory notification, USEC delayed filing a written report with the Nuclear Regulatory Commission (NRC) until July 1, with public notice further delayed by the July 4 holiday. The report that was filed oddly included no mention of the most salient aspect of the occurrence -- the centrifuge crashes -- and was limited to a description of safety violations in peripheral parts of the facility.

By waiting nineteen days, USEC Inc. avoided adverse publicity and impact to its stock price, before the critical deadline of June 30, a date USEC itself had established by ultimatum as the date by which the Department of Energy had to award a conditional commitment on a $2 billion federal loan guarantee, or risk project termination. (Despite the threat, eleven months have now passed without a loan guarantee or a federal bailout and the project has yet to be terminated.)

U.S. Senator from Ohio Rob Portman, acting as a mouthpiece for USEC, downplayed the 6-11 accident as "a hiccup" -- a PR term invented by USEC for the occasion, when the story broke:

The hiccup at the plant a few weeks ago, I think that has been addressed…We believe all the technology questions about the refinements have been answered. Those should be behind us now.

Portman made that comment to area newspapers in the context of his continued lobbying for a loan guarantee for USEC, even as the Parsons team was conducting its investigation, which would result in the condemnatory report , submitted later that month but never released to the public by DOE or USEC.

Portman is now touted as a likely Romney running-mate. Romney, as we know, terrified the family dog into gastrointestinal distress by driving with the pooch on the roof of the car. Portman isn't like that. He'd scare us shitless, by throwing all of us under the bus.