Nuclear Safety:

Construction of the Protective Shelter for the Chernobyl Nuclear Reactor Faces Schedule Delays, Potential Cost Increases, and Technical Uncertainties

GAO-07-923: Published: Jul 19, 2007. Publicly Released: Jul 26, 2007.

Additional Materials:

Contact:

Eugene E. Aloise
(202) 512-6870
contact@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

In 1986, an explosion at the Chernobyl nuclear power plant in Ukraine destroyed the reactor building and released massive amounts of radioactive contamination. A temporary shelter was built over the damaged reactor to prevent further contamination. The United States is a major donor to an international project to build a new shelter to replace the existing one, which is badly deteriorating. GAO was asked to (1) assess the progress toward completing the new shelter, (2) review the cost estimates to complete the project, and (3) assess the U.S. role in overseeing and funding the project. To carry out its work, GAO analyzed program documents, interviewed U.S. and international program officials, and visited the Chernobyl nuclear power plant.

Although two of three construction components--site preparation and stabilization of the existing shelter--are nearly finished, construction of the new shelter has fallen about 7 years behind schedule. Over the past couple of years, the main reason for schedule slippage has been the failure to award a construction contract. The lack of a contract is partly the result of a lengthy disagreement between Ukraine and the European Bank for Reconstruction and Development (EBRD). In late 2006, the Chernobyl nuclear power plant director told GAO that the donors should not make any additional contributions to the project until contracting issues were resolved. These problems contributed to donors' concerns about when and at what cost the project will be completed. In addition, technical uncertainties associated with the construction of the new shelter have also contributed to schedule slippages and threaten to further delay the project. The estimated cost to complete the Chernobyl Shelter Project is currently $1.2 billion. However, a higher cost estimate is likely due to, among other things, escalating prices for labor and materials. Also, many other factors, such as expanding the project's scope to include the removal of the radioactive reactor fuel, could raise costs further. The Department of State, which has the lead role for the U.S. government, relies on the EBRD to directly manage the project, including the disbursement of funds. The United States has pledged $203 million for the project but still has to provide $49 million to meet its current commitment. In addition, the United States will likely be requested to provide funds beyond the $203 million pledged because some donor governments may not have the resources or may no longer be willing to provide additional funds. To date, the United States has not placed conditions or benchmarks tied to tangible progress toward project completion on its contributions to the Chernobyl Shelter Fund.

Status Legend:

More Info
  • Review Pending-GAO has not yet assessed implementation status.
  • Open-Actions to satisfy the intent of the recommendation have not been taken or are being planned, or actions that partially satisfy the intent of the recommendation have been taken.
  • Closed-implemented-Actions that satisfy the intent of the recommendation have been taken.
  • Closed-not implemented-While the intent of the recommendation has not been satisfied, time or circumstances have rendered the recommendation invalid.
    • Review Pending
    • Open
    • Closed - implemented
    • Closed - not implemented

    Recommendations for Executive Action

    Recommendation: To help ensure that the United States has a clear and consistent strategy--as well as a sound basis for continuing to support the Chernobyl Shelter Project--the Secretary of State should, working in consultation with other contributors and EBRD, consider developing a contingency strategy for obtaining the additional funding that may be needed to complete the project. The strategy should include encouraging other major donor countries and the European Commission to also contribute additional funding.

    Agency Affected: Department of State

    Status: Closed - Implemented

    Comments: In GAO's 2007 report, we reported difficulties with continued funding of the Chernobyl project from the FREEDOM Support Act (FSA) account, which had dwindling funds used for many other purposes. In State's 2007 letter responding to our recommendations, State said the department fully concurred with GAO's related recommendation, is anticipating future funding needs in its budget planning, and continues to press for equitable burden-sharing among our international partners. However, in 2011 a State official told us that the U.S. had been able to find sufficient funding in the same account for the current round of additional funding, which is expected to be the U.S.'s final pledge, and therefore had not needed to plan a contingency funding strategy. As a result, alternative actions were taken to meet the objective of the recommendation.

    Recommendation: To help ensure that the United States has a clear and consistent strategy--as well as a sound basis for continuing to support the Chernobyl Shelter Project--the Secretary of State should, working in consultation with other contributors and EBRD, consider obtaining an independent validation of major revisions to cost estimates.

    Agency Affected: Department of State

    Status: Closed - Not Implemented

    Comments: According to a State official, State has not sponsored, or advocated for, any independent validations of the project's cost estimates.

    Recommendation: To help ensure that the United States has a clear and consistent strategy--as well as a sound basis for continuing to support the Chernobyl Shelter Project--the Secretary of State should, working in consultation with other contributors and EBRD, consider periodically reviewing and revising the benchmarks to ensure they are relevant and applicable to the project's performance goals and time frames.

    Agency Affected: Department of State

    Status: Closed - Implemented

    Comments: As required by the contingent placed on the U.S.'s April 2011 pledge of additional funds, a quality assurance officer would be based at the project site and continuously report directly to the donor nations, including the U.S. Unlike the set format of the current project reports provided to donors, the quality assurance officer could revise reporting information to donors as needed to explain emerging problems. State's action implements the intent of our recommendation, which is to ensure that donors get continuously relevant and applicable information on the project's performance goals and time frame.

    Recommendation: To help ensure that the United States has a clear and consistent strategy--as well as a sound basis for continuing to support the Chernobyl Shelter Project--the Secretary of State should, working in consultation with other contributors and EBRD, consider establishing specific performance benchmarks for the project that need to be met before additional pledges of funds are made in the future.

    Agency Affected: Department of State

    Status: Closed - Implemented

    Comments: According to a State official, when State recognized in 2010 another pledge conference would be needed to complete the Chernobyl shelter project, it decided that it needed to be better able to assess the project's performance because it was difficult for State to get benchmarks from the shelter contractor or any other source. Consequently, State made its April 2011 pledge of additional funds contingent on increased monitoring of the projects cost and schedule benchmarks to ensure they remain within agreed cost amounts and timeframes. Since the U.S. pledge would be paid in annual increments, State would require continuous benchmark monitoring and reporting as a condition of its annual payments. Although State did not establish its own performance benchmarks, its considerations and actions partially implement our recommendation; it made U.S. annual payments contingent on the project's performance against benchmarks being continuously transparent, which provides donors a better means to quickly identify and respond to any poor performance.

    Recommendation: Furthermore, to increase the State Department's accountability and transparency for funding the project, the Secretary of State should provide a detailed annual report to Congress about the status of the project, including project costs, project milestones, and estimated completion dates.

    Agency Affected: Department of State

    Status: Closed - Not Implemented

    Comments: As of May 2011, State has not provided annual reports to Congress to provide more detailed information about the project.

    Aug 25, 2014

    Aug 7, 2014

    Jul 30, 2014

    Jul 29, 2014

    Jul 22, 2014

    Jun 17, 2014

    Jun 11, 2014

    Jun 10, 2014

    May 28, 2014

    Looking for more? Browse all our products here