As one of my first tasks early in the first Clinton Administration as the newly appointed Deputy Assistant Secretary for Policy, I conducted the first (and only) asset inventory of the U.S. Department of Energy (DOE). In carrying it out, we departed from the usual reliance on DOE contractors, and established a team of federal employees throughout the DOE complex to scour the system for data. In doing this we saved a lot of money and time that would otherwise be consumed by DOE contractors that had perfected the art of cost maximization.
After six months we briefed Energy Secretary O’Leary on what we found. With real estate holdings of more than 2.4 million acres–an area larger than Rhode Island and Delaware combined–the DOE was the largest government-owned industrial energy supply and research enterprise in the country, responsible for:
- More than 20,700 specialized facilities and buildings, including 5,000 warehouses, 7,000 administrative buildings, 1,600 laboratories, 89 nuclear reactors, 208 particle accelerators, and 665 production and manufacturing facilities.
- More than 130,000 metric tons of chemicals, a quantity roughly equivalent to the annual output of a large chemical manufacturer.
- More than 270,000 metric tons of scrap metal—equivalent to more than two modern aircraft carriers in weight. (The dismantlement of three gaseous diffusion plants will generate about 1.4 million metric tons of additional scrap.)
- More than 17,000 pieces of large industrial equipment.
- More than 40,000 metric tons of base metals and more than 10,000 pounds of precious metals, such as gold, silver, and platinum.
- About 700,000 metric tons of nuclear materials, mostly depleted uranium but also including weapons-grade and fuel-grade plutonium, thorium, and natural and enriched uranium.
- About 320,000 metric tons of stockpiled fuel oil and coal for 67 power plants.
- About 600 million barrels of crude oil stored at the Strategic Petroleum Reserve.
- Electrical distribution systems for the Bonneville, Western Area, Southwestern, Southeastern, and Alaska power administrations.
If the Energy Department were a private concern with more than 100,000 employees, it would be one of the nation’s largest and most powerful corporations. And, we determined, if it were privately held, it would be filing for bankruptcy.
Major elements of Energy’s complex were closing down, leaving a huge unfunded and dangerous mess. After more than a half century of making nuclear weapons, the DOE possessed one of the world’s largest inventories of dangerous nuclear materials and it has created several of the most contaminated areas in the Western hemisphere.
We discovered that a significant percentage of overhead expenses at several shuttered sites were from hoarding fungible assets that were no longer needed. The challenge was to empty these warehouses and to generate an income for the U.S. government by selling off valuable excess materials.
Our first effort was aimed at the large amount of uncontaminated precious metals contained in nuclear weapons that would generate millions-of-dollars in revenue from warheads scheduled for dismantlement under the 1991 Strategic Arms Reduction Treaty (START). For the first time, nuclear disarmament would actually make money for the taxpayer.
We were astounded to find that for decades intact weapons components containing large amounts of precious metals were being disposed at great expense in a classified landfill under heavy guard. It took a direct order from the Secretary for DOE’s PANTEX weapons assembly and dismantlement facility near Amarillo, TX to obtain an industrial scale hydraulic hammer to smash non-nuclear components into little pieces so that the gold and other metals can be recovered without revealing design secrets.
Further complicating the process for dismantling weapons, the DOE had failed to properly maintain its system for assessing and evaluating each nuclear weapon for reliability, aging problems, and safe dismantlement. Known as configuration management (CM), this system is a fundamental element in the control of the nuclear stockpile and is based on careful documentation of “as built” drawings and product definitions made during the design, manufacture, assembly, and deployment of a nuclear weapons.
My staff discovered that DOE could not find nearly 60 percent of the “as built” drawings that document all changes made to active weapons selected for dismantlement. I threw a fit and reported it to the front office, which promptly took action.
Over the ensuing decade, we wound up sending about $50 million from the sale of precious metals extracted from dismantled weapons back to the treasury. As a side benefit, we also set up the DOE’s first electronic recycling center to recover fungible materials from DOE’s huge inventory of excess computers.
After receiving a Secretarial Gold Medal for our asset management program, I became increasingly isolated from the DOE front office, and spent most of my time involved with environment, safety and health problems afflicting the DOE nuclear weapons complex. As soon as Secretary O’Leary departed in late 1996, our asset inventory was buried and barred from public disclosure.
However, I drew the line when it came to the disposition of radiologically contaminated materials, such as the vast amount of scrap metal resulting from the decommissioning of nuclear weapons facilities.
In 1994, I blocked a deal that would have allowed some 10,000 tons of radiation-contaminated nickel from nuclear weapons operations to be recycled into the civilian metal supply, where some percentage of it would inevitably wind up in stainless steel items such as intrauterine devices, surgical tools, children’s orthodontic braces, kitchen sinks, zippers, and flatware. However, that confrontation was not to be the end of the scrap metal gambit.
The pressures to recycle 1.7 million metric tons of contaminated metal scrap (equivalent to 17 U.S. aircraft carriers in weight) at nuclear weapons facilities in Tennessee, Kentucky and Ohio were enormous.
I dug in my heels and opposed an effort, supported by Vice President Gore’s office, to release tens of thousands of tons of radiologically contaminated metals into commerce. By claiming cost savings associated with foregoing landfill disposal, DOE contractors would be able to pocket the profits from the sale of scrap. Going forward however, I was seen as obstructionist and was effectively shunned from decision-making circles.
After Hazel O’Leary left as Energy Secretary in late 1996, I lost my political “air cover” and was perceived in the words of a colleague by the incoming leadership of the agency (Secretary Frederico Pena’s team) as “too radioactive.”
Even though I was being excluded from policy decisions, I still persisted.
As a former environmental activist, I had no compunctions about going outside of the Department to convince an old friend at the Natural Defense Resource Council to file a lawsuit to block the free release of the contaminated metal.
I knew that if DOE and its contractors got their way, this practice would lead to a major public backlash. Not to mention the market impacts the contaminated material would create for the U.S. steel industry, which was almost totally dependent on recycled metal for its feedstock. Steel makers had been burned before by errant radiation sources and the last thing they wanted was for the public to realize that the stainless-steel fork on the dinner table had some plutonium in it from a nuclear weapons plant. But consideration of these consequences could easily get overlooked in the DOE, where decisions were made in isolation and secrecy.
The lawsuit stopped the train temporarily. Judge Gladys Kessler, in a strongly worded opinion, stated: “It is . . . startling and worrisome that from an early point on, there has been no opportunity at all for public scrutiny or input in a matter of such grave importance.” Calling the recycling effort “entirely experimental at this stage,” she concluded, “The potential for environmental harm is great, especially given the unprecedented amount of hazardous materials which the defendants seek to recycle.”
In the summer of 1998, I received a call from the White House indicating that I was being fired within the next 30 days. This was the third time my detractors sought to end my tenure as a senior political appointee in DOE’s Policy office. This time, it seemed to be final.
A week before my departure, I was summoned to meet with Bill Richarson – the newly installed Secretary of Energy. He was slouched on the sofa and disheveled after a long day. “I don’t know why you got on the list. You must have pissed-off quite a few people,” he said with a devilish smile. “But you have a lot of folks that want to keep you around. When I visited DOE sites, members of Congress, union officials, Indian tribes, and environmental activists, would ask me about this Alvarez guy.”
He then pulled out a news clipping from the Seattle Times about a walk-out staged by the members of a DOE advisory panel at the Hanford facility in protest to my sacking. “You must be a fighter, I like fighters,” he said approvingly. Richardson reversed the White House decision and appointed me as his Senior Policy Advisor, where I was tasked among other things to end the “hot scrap” recycling scam.
A senior scholar at the Institute for Policy Studies, Robert Alvarez served as senior policy adviser to the Energy Department’s secretary and deputy assistant secretary for national security and the environment from 1993 to 1999.