Summary: GAO discussed the Department of Energy's (DOE) recent revisions to uranium enrichment services criteria. The revised criteria reflected a shift from full cost recovery and standard contractual terms to increased emphasis on competition. GAO found that: (1) three criteria provisions conflicted with the statutory requirements governing the enrichment program; (2) the criteria permitted DOE to determine that some future government enrichment costs were not appropriate for recovery; (3) the revised criteria eliminated the standardization that Congress intended; (4) the flexibility of the revised criteria will make congressional oversight difficult; (5) although the criteria provided DOE with maximum flexibility, there were few feedback provisions or accountability measures; and (6) the criteria would remove benchmarks that have been useful in the past to monitor the program. GAO believes that: (1) legislation amending the Atomic Energy Act is the correct approach for effecting change in the uranium enrichment program; (2) if Congress accepts the criteria, full recovery of enrichment services costs would become a secondary objective; and (3) under the revised criteria, any recovery of future costs would be uncertain.
