Nuclear Safety: Status of U.S. Assistance to Improve the Safety of
Soviet-Designed Reactors (Letter Report, 10/29/96, GAO/RCED-97-5).

The goals of the U.S. nuclear assistance program are to reduce the risk
of accidents at and to encourage the shutdown of high-risk
Soviet-designed nuclear power plants. Despite efforts by the United
States and other countries, none of the highest-risk reactors--including
some of the type that exploded at Chornobyl--has been closed and one in
Armenia has recently been restarted. The Energy Department (DOE)
originally expected that this effort would be short- to mid-term in
duration. DOE now believes that the program should continue for at least
a decade and will cost about $500 million. However, the agency has yet
to develop a plan spelling out how this money will be spent or how DOE
will achieve its long-term objectives. In addition, 11 of the 13 safety
projects that GAO reviewed have experienced delays. In six cases, U.S.
equipment was not delivered to plants in a timely manner because customs
officials in Russia and Ukraine would not release the equipment. Other
impediments, including a requirement that some U.S.-supplied safety
equipment be tested in Russia, have also contributed to delays. The
Pacific Northwest National Laboratory has placed a program
representative in Russia to help resolve customs problems. GAO believes
that a laboratory representative in Ukraine could be helpful.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  RCED-97-5
     TITLE:  Nuclear Safety: Status of U.S. Assistance to Improve the 
             Safety of Soviet-Designed Reactors
      DATE:  10/29/96
   SUBJECT:  Nuclear powerplant safety
             Nuclear reactors
             International cooperation
             Federal aid to foreign countries
             Technical assistance
             International relations
             International economic relations
             Industrial safety
IDENTIFIER:  Chernobyl Nuclear Powerplant (USSR)
             Ukraine
             Soviet RBMK Reactor
             DOE Nuclear Safety Assistance Program
             Armenia
             Soviet VVER 440 Reactor
             Bulgaria
             Lithuania
             Smolensk Nuclear Powerplant (Russia)
             Russia
             
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Cover
================================================================ COVER


Report to the Chairman, Committee on Foreign Relations, U.S.  Senate

October 1996

NUCLEAR SAFETY - STATUS OF U.S. 
ASSISTANCE TO IMPROVE THE SAFETY
OF SOVIET-DESIGNED REACTORS

GAO/RCED-97-5

Nuclear Safety

(170267)


Abbreviations
=============================================================== ABBREV

  ANL - Argonne National Laboratory
  BAO/ORNL - Brookhaven Area Office and Oak Ridge National Laboratory
  BNL - Brookhaven National Laboratory
  CH - Chicago Area Office
  DOE - Department of Energy
  GAN - Gosatomnadzor
  GAO - General Accounting Office
  INPO - Institute of Nuclear Power Operations
  Minatom - Russian Ministry of Atomic Energy
  NRC - Nuclear Regulatory Commission
  REA - Rosenergoatom
  PNNL - Pacific Northwest National Laboratory
  SAIC - Science Applications International Corporation
  USAID - U.S.  Agency for International Development

Letter
=============================================================== LETTER


B-272926

October 29, 1996

The Honorable Jesse A.  Helms
Chairman, Committee on Foreign
 Relations
United States Senate

Dear Mr.  Chairman: 

The Moscow Nuclear Safety and Security Summit, held in April 1996,
coincided with the tenth anniversary of the accident at the Chornobyl
nuclear power reactor in Ukraine.  This summit underscored the
continuing concern that the United States and other countries have
about the safety of 60 Soviet-designed civil nuclear power reactors
operating in the Newly Independent States\1 and in the countries of
central and eastern Europe.  Fifteen of these reactors, known as RBMK
reactors, are the type that exploded at the Chornobyl nuclear power
plant.  In 1994, we reported on international assistance efforts,
including those of the United States, to improve the safety of the
Soviet-designed reactors.\2

This report responds to your February 16, 1996, request to update our
information on the U.S.  nuclear safety assistance program. 

In response to your request, this report provides information on (1)
any changes in the goals of the U.S.  safety assistance program since
its inception, (2) the costs associated with the U.S.  safety
assistance program, and (3) the status of 13 (of 196) safety projects
implemented by the Department of Energy (DOE) and the Nuclear
Regulatory Commission (NRC) and the way in which the agencies assess
the effect of the projects on improving safety. 


--------------------
\1 The Newly Independent States are Armenia, Azerbaijan, Belarus,
Georgia, Kazakhstan, Kyrgystan, Moldova, Russia, Tajikistan,
Turkmenistan, Ukraine, and Uzbekistan.  Lithuania, which operates two
Soviet-designed nuclear power reactors, is not considered one of the
Newly Independent States. 

\2 Nuclear Safety:  International Assistance Efforts to Make
Soviet-Designed Reactors Safer (GAO/RCED-94-234, Sept.  29, 1994). 


   RESULTS IN BRIEF
------------------------------------------------------------ Letter :1

The goals of the U.S.  nuclear safety assistance program remain
unchanged:  to reduce the risk of accidents and to encourage the
shutdown of the highest-risk Soviet-designed nuclear power reactors. 
Despite the efforts of the United States and other countries, none of
the highest-risk reactors have been closed and one in Armenia has
recently been restarted.  DOE plans to increase its assistance to the
RBMK reactors, which are considered the highest-risk, to improve
their safety while they continue to operate.  This action is being
taken, in part, because the United States recognizes that these
reactors may not be shut down for various reasons, including (1) the
slow pace of economic reform in the countries operating the reactors,
(2) concerns about the social and economic well-being of workers who
would be displaced if the reactors were closed, and (3) the need to
obtain financing to help develop replacement energy sources.  In our
view, providing this assistance could pose a dilemma because it may
encourage the continued operation of the same reactors that the
United States wants to see closed as soon as possible. 

DOE, which is the main provider of U.S.  nuclear safety assistance,
originally planned its program to be short- to mid-term.  However,
the program has grown significantly because of the complexities and
challenges involved in improving the safety of Soviet-designed
reactors.  DOE believes that the program should continue at least 10
more years and require about $500 million.  DOE officials told us
that they are developing a long-term plan that addresses how
additional funds would be spent and how the program's long-term
objectives would be met. 

As of March 31, 1996, DOE and NRC (the other provider of U.S. 
assistance) had received $208 million for their nuclear safety
assistance programs.  These agencies had spent about $89 million, and
DOE's expenditures constituted 88 percent of this amount.  Of the
total expenditures, about $42 million was for nuclear safety
equipment and products.  Other expenditures include program-related
labor, travel, and overhead. 

Eleven of the 13 DOE and NRC safety projects that we reviewed have
experienced delays.  For six of these delayed projects, U.S. 
equipment was not delivered to the plants in a timely manner because
customs officials in Russia and Ukraine would not release the
equipment.  Other impediments, including a requirement that certain
U.S.-supplied safety equipment be tested in Russia, have also
contributed to delays.  Despite these problems, several projects are
progressing and have, for example, resulted in the installation of
fire safety equipment and other safety-related hardware at plants in
Russia and Ukraine and in the development of safety-related training
programs in Ukraine.  However, it is too early to assess the extent
to which these projects are improving safety because only one--a
study of nuclear energy options for Russia--has been completed. 
Although DOE and national laboratory officials are attempting to
measure safety improvements, they recognize that it is difficult to
quantify the impact of the assistance provided. 


   BACKGROUND
------------------------------------------------------------ Letter :2

In 1992, the U.S.  government initiated a program known as the Lisbon
Initiative on Multilateral Nuclear Safety.  This program is designed
to help improve the safety of Soviet-designed reactors.  The U.S. 
program is part of a larger international effort to improve the
safety of these reactors.  As of February 1996, 22 donors, including
the United States, had pledged or contributed more than $1.4 billion
in assistance to this effort. 

The 60 operational Soviet-designed nuclear power reactors pose
significant risks because of deficiencies in their design and
operation.  Of greatest concern are 26 of these reactors that western
safety experts generally agree fall well below accepted international
safety standards and cannot be economically upgraded.  These include
15 reactors known as RBMKs and 11 reactors known as VVER 440 Model
230s.  The RBMK reactors--considered the least safe by western safety
experts--and VVER 440 Model 230 reactors are believed to present the
greatest safety risk because of inherent design deficiencies,
including the lack of a containment structure,\3 inadequate fire
protection systems, unreliable instrumentation and control systems,
and deficient systems for cooling the reactor core in an emergency. 
Most of these reactors are located in countries that do not have
independent or effective nuclear regulatory bodies to oversee plant
safety.  Figure 1 shows the type and location of the 60
Soviet-designed reactors operating in the Newly Independent States
and in central and eastern Europe. 

   Figure 1:  Operational
   Soviet-Designed Nuclear Power
   Plants, as of July 1996

   (See figure in printed
   edition.)

Note:  Numbers in parentheses show the total reactors in the country,
and numbers within symbols show the number of reactors of a specific
type at a site. 

Sources:  DOE and GAO. 

Several federal agencies share responsibility for the U.S.  nuclear
safety assistance program.  The Department of State provides overall
policy guidance, with assistance from the U.S.  Agency for
International Development (USAID).  DOE is responsible for
implementing projects involving training, operational safety, and
safety-related equipment.  Three of DOE's national laboratories
support the program.  The Pacific Northwest National Laboratory
provides the primary management support, and along with the
Brookhaven National Laboratory and the Argonne National Laboratory,
manages specific safety projects.  NRC is responsible for assisting
the recipient countries' nuclear regulatory organizations. 


--------------------
\3 The containment structure, generally a steel-lined concrete
dome-like structure, serves as the ultimate barrier to the release of
radioactive material in the event of a severe accident. 


   GOALS OF U.S.  SAFETY
   ASSISTANCE HAVE REMAINED THE
   SAME, BUT SCOPE OF DOE'S
   PROGRAM HAS EXPANDED
------------------------------------------------------------ Letter :3

The goals of the U.S.  safety assistance program have remained the
same since its inception--encouraging the shutdown of the
highest-risk Soviet-designed nuclear power reactors and reducing the
risk of accidents.  However, none of these reactors have been closed,
and one has been restarted.  In addition, DOE's portion of the
program has evolved and expanded to cover a broader range of safety
projects. 


      NO HIGH-RISK REACTORS HAVE
      BEEN CLOSED
---------------------------------------------------------- Letter :3.1

Although the United States remains committed to securing the closure
of the highest-risk nuclear power reactors, none have been closed. 
Furthermore, Armenia recently restarted one of its VVER 440 Model 230
reactors.  Department of State officials told us that progress has
been made in getting closure agreements for some reactors in
Bulgaria, Lithuania, and Ukraine, but these officials also recognize
that it may be difficult for these countries to meet these agreements
on a timely basis.  For example, Bulgaria has agreed to a phased
shutdown of its highest-risk reactors by 1998 as adequate replacement
energy, such as hydroelectric power, becomes available.  Department
of State officials said the closure date will probably be delayed by
2 or 3 years because, among other things, the pace of economic reform
in Bulgaria has been slow. 

In 1995, the G-7 nations (major industrialized nations) and Ukraine
signed an agreement that includes Ukraine's commitment to close the
Chornobyl nuclear power reactor by 2000.  State Department and USAID
officials said that successful implementation of the agreement hinges
on Ukraine's progress in reforming the energy sector.  Such progress
is key to continuing the international financial assistance that may
ease the impact of closure. 

DOE, national laboratory, and Department of State officials
acknowledge that many of the highest-risk reactors may continue to
operate for several more years.  Many factors complicate U.S.  and
western nations' efforts to obtain early closure of the highest-risk
reactors, including (1) a lack of consensus, particularly among
Russian nuclear safety experts, about the safety of their reactors;
(2) concerns about the social and economic well-being of workers who
would be displaced if reactors were closed; (3) a commitment to
expanding nuclear power, particularly in Russia, to meet future
energy needs; and (4) the need to obtain financing to support the
development of replacement energy. 

DOE's Director of the Office of Nuclear Energy, Science, and
Technology said that Russia does not intend to close its highest-risk
reactors for many years, and he believes that the United States
should continue to provide assistance so that these reactors can
operate as safely as possible until they are closed.  Department of
State and USAID officials also noted that it is sound policy to
continue to reduce the risks of accidents at the highest-risk
reactors. 

In keeping with this policy, DOE plans to increase technical
assistance to RBMK plants, including Chornobyl.  The Chornobyl
initiative is part of a multinational effort to provide safety
upgrades that can be completed quickly.  DOE is planning to spend
about $13.8 million at the Chornobyl nuclear power plant, including
upgrades for fire safety at one of the two operating reactors and
instituting operational safety and training programs for both
reactors. 

In total, DOE plans to spend about $33 million for safety parameter
display systems for plants with RBMK reactors.  This system provides
information, which is displayed on a monitor, to operators about
plant conditions that are important for safety.  In addition, DOE
plans to spend about $8.5 million on a project to transfer western
maintenance practices, training methods, and technology to staff at
RBMK reactors.\4 DOE officials noted that the project will not extend
the life of the RBMK reactors but will improve safety. 

Our review of the RBMK maintenance initiative indicates that the
repair or replacement of any component that a plant relies on would
support the plant's continued operations.  While these efforts will
not by themselves extend the lifetime of the plant, they will serve
to keep the plant's components in service longer.  In 1993, the
Chairman of NRC at that time said that it is difficult to draw a fine
line between short-term safety improvements and upgrades that could
encourage a plant's operator to think in terms of long-term
operations. 


--------------------
\4 Specific projects include laser alignment equipment and special
lathes to prepare large pipes for welding, as well as the technology
and training associated with this equipment. 


      SCOPE OF DOE'S PROGRAM HAS
      EXPANDED
---------------------------------------------------------- Letter :3.2

DOE's program was initially viewed as short- to mid-term, totaling
between $25 million and $40 million, with additional funding planned
of about $100 million.\5

However, DOE's portion of the program has grown because of the
complexities and challenges involved in improving the safety of
Soviet-designed plants.  As of March 1996, DOE had initiated more
than 150 projects in this program, and DOE's Director of the Office
of Nuclear Energy, Science, and Technology told us that approximately
$500 million would be required over the next 10 years to address the
program's long-term safety and training needs.  (According to
Department of State and USAID officials, this estimate has not been
agreed upon by other U.S.  government agencies participating in the
program.) In contrast, NRC views its regulatory assistance program,
totaling about $28 million, as limited in terms of its size and
scope. 

DOE and Pacific Northwest National Laboratory officials said that
while it remains important to address short-term safety problems at
the plant level, it is equally important to approach safety at a
systemic level to help bring about sustainable improvements.  As a
result, the program has placed increased emphasis on transferring
U.S.  technology and encouraging the recipient countries to analyze
and fix their own safety problems.  According to DOE officials, the
technology transfer aspect of the program is having a positive
impact. 

DOE has developed a short- to mid-term plan that provides an overview
of the program's objectives, performance measurements and ongoing
projects.  Although they plan to do so, DOE officials have not yet
established a long-term plan linking the program's objectives to
measurable goals or providing a date for meeting those goals.  As a
result, it is unclear how DOE will demonstrate when and how it has
achieved the program's goals.  It is also unclear, without such a
plan, when the program will end.  According to DOE's Deputy Associate
Director for International Nuclear Safety, the 10-year approach is
based on an intuitive view of the time needed to complete the
program's overall objectives.  DOE officials told us in September
1996 that the agency has begun to develop a plan that will link
objectives to goals and set a date for achieving these goals. 


--------------------
\5 In our 1994 report, we noted that, as of June 30, 1994, DOE
planned to spend about $134 million. 


   U.S.  NUCLEAR SAFETY ASSISTANCE
   PROGRAM HAS RECEIVED $208
   MILLION
------------------------------------------------------------ Letter :4

DOE and NRC have received $208 million for their programs in the
Newly Independent States and countries of central and eastern Europe. 
USAID has provided about 80 percent of the total funds received
through various interagency agreements with DOE and NRC.  The
remainder of the funds has come from DOE ($30 million) and the
Department of Defense ($11 million).  Beginning in fiscal year 1996,
DOE began receiving direct appropriations for the program but is
still obtaining some funds from USAID for special projects, such as
Chornobyl.  (App.  I provides greater detail on DOE's and NRC's costs
for the safety assistance program and fig.  I.1 provides information
about the Chornobyl project.)

The U.S.  nuclear safety program has focused on several types of
assistance, including management and operational safety, engineering
and technology (including fire safety and other plant-specific
improvements), plant safety evaluations, and regulatory enhancements. 
Operational improvements can be implemented at all plants regardless
of reactor type.  Plant-specific measures are generally directed
toward reactors such as the oldest RBMKs and VVER 440 Model 230s.  As
figure 2 shows, the greatest percentage of the funds--36 percent--has
or will be spent on management and operational safety, which includes
training and safety procedures. 

   Figure 2:  Planned and Actual
   Distribution of U.S.  Funding
   of $208 Million for Nuclear
   Safety Assistance Program, as
   of March 31, 1996

   (See figure in printed
   edition.)

Sources:  Pacific Northwest National Laboratory and NRC. 

As of March 31, 1996, DOE had obligated $119.2 million and had spent
$78.3 million of the $180.1 million it had received.  NRC had
obligated $16.5 million and spent $11 million of the $27.9 million
received.  (See table I.1).  Of the combined agencies' expenditures,
$42.2 million was for nuclear safety equipment and other products. 
More than half of the $42.2 million was for training or
training-related items, such as simulators.\6 Less than one-third of
this amount was for safety-related hardware, such as fire safety or
other plant-specific equipment.  (See fig.  I.2).  Other
program-related expenditures were for labor, travel, overhead, and
other costs.  (See tables I.2 and I.3). 

DOE, NRC, and Pacific Northwest National Laboratory officials
recognize that their obligation and expenditure rates for their
respective programs--particularly in Russia and Ukraine--have lagged
over time.  They stated, however, that several factors have
contributed to the delays, including (1) concerns about nuclear
liability in the United States that led to a change in DOE's program
management and stalled many projects;\7 (2) logistical problems with
establishing assistance programs in Russia and Ukraine; (3) the need
to develop working relationships with Russian and Ukrainian
organizations, some of which have experienced significant turnover
and/or attrition of key personnel; and (4) procurement delays in the
United States. 

DOE, national laboratory, and NRC officials noted concerns about
their programs' unobligated balances.  As of March 31, 1996, DOE's
unobligated balance was about $61 million and NRC's was about $11
million.  DOE intended to obligate all currently unobligated funds by
September 30, 1996.\8 While NRC has obligated 88 percent of its funds
for central and eastern Europe, its obligation rates for Russia and
Ukraine are significantly lower.  NRC expects to obligate its
available funds, primarily for Russia and Ukraine, over the next few
years. 


--------------------
\6 A simulator replicates the plant's conditions and is used to train
the plant's operators. 

\7 In 1994, Associated Universities, Inc., the organization that
operates the Brookhaven National Laboratory for DOE and had been
responsible for managing the program, decided not to undertake
certain safety-related projects in the Newly Independent States
because Brookhaven did not have adequate liability protection. 
During this period, U.S.  contractors and others expressed
significant concern about performing nuclear safety-related work in
these countries without liability protection.  Subsequently, DOE
transferred the responsibility for program management from Brookhaven
to the Pacific Northwest National Laboratory. 

\8 As of July 28, 1996, DOE had obligated $156.4 million and spent
$96.6 million of the $180.1 million it had received, leaving an
unobligated balance of $23.7 million.  As of July 31, 1996, NRC had
obligated $20.3 million and spent $13.1 million of the $27.9 million
received, leaving an unobligated balance of $7.6 million. 


   STATUS OF 13 DOE AND NRC SAFETY
   PROJECTS IN RUSSIA AND UKRAINE
------------------------------------------------------------ Letter :5

Of the 13 safety projects we reviewed, 11 have been delayed in their
implementation and one has been completed.  Projects have been
delayed largely because of difficulties in getting U.S.-supplied
equipment cleared through Russian and Ukrainian customs officials. 
While some of these difficulties continue, several projects are
moving forward.  Despite the recent progress, it is too early to
assess the impact of these projects on safety. 

Eleven of the 13 safety projects implemented by DOE and NRC have been
delayed, and 3 are more than 2 years behind schedule.  At the time of
our review, one project, a study of nuclear energy options for
Russia, had been completed.  The study concluded that, among other
things, it was in Russia's economic interest to upgrade some of its
operating nuclear power reactors and to close and decommission some
of its higher-risk reactors.  (See app.  II for a summary of the
projects and the reasons for the delays). 

A number of factors have delayed the implementation of these
projects, including (1) problems with customs, (2) foreign officials'
imposition of unanticipated and/or burdensome requirements, and (3)
the inability of Russia and Ukraine to provide adequate financial
support for some projects.  Despite these impediments, several
projects are now progressing more quickly.  (DOE's projects are
discussed in detail in app.  III, and NRC's are discussed in app. 
IV.)

For the 13 projects we reviewed, DOE has been requested to pay at
least $505,000 in unanticipated costs.  These costs include

  -- $442,000 to replace or refurbish unusable simulator parts in
     Ukraine,

  -- $34,000 to store U.S.  equipment in European warehouses pending
     the resolution of customs problems in Russia,

  -- $26,000 for airfare to enable Ukrainians working on a year-long
     simulator project in the United States to return to Ukraine or
     to have their spouses visit them in the United States, and

  -- $3,000 to the Ukrainian customs organization for fees to
     authorize the release of equipment. 


      CUSTOMS PROBLEMS IN RUSSIA
      AND UKRAINE
---------------------------------------------------------- Letter :5.1

In 6 of the 13 safety projects we reviewed, Russian and/or Ukrainian
customs officials did not release U.S.  equipment to the nuclear
power plants in a timely manner.  Under the terms of agreements that
the United States entered into with Russia and Ukraine, this
equipment is to enter into these countries duty-free.\9 Local customs
officials in Russia and Ukraine have not consistently recognized the
duty-free status of this equipment.  Department of State and USAID
officials told us that other U.S.  assistance programs in the Newly
Independent States have experienced similar problems.  Customs
problems have included the following: 

  -- Russian customs officials impounded 100 fire suits and related
     fire safety equipment, valued at $110,000, until customs duties
     were paid.  This equipment was destined for the Smolensk nuclear
     power plant.  Since no duties were paid, customs officials
     turned the equipment over to a Russian court, which donated the
     equipment to a local fire company.  Realizing it could not use
     the equipment, the fire company eventually sent the gear to the
     nuclear power plant, about 1 year after it had been shipped to
     Russia. 

  -- A U.S.  contractor placed emergency batteries and related
     equipment in a storage facility in the Netherlands for several
     months pending the resolution of customs problems in Russia. 
     The shipper requested the reimbursement of about $11,300 for
     storage costs, but DOE had not paid these costs at the time of
     our review. 

  -- Russian customs officials have been holding a sample
     high-temperature suit and related equipment, valued at about
     $26,000, for over 2 years.  The equipment, which was examined by
     Smolensk nuclear power plant officials in May 1994, is no longer
     considered useful by DOE except for demonstration purposes.  As
     a result, DOE has not pressed Russian authorities to release it. 
     No customs duties or storage fees have been imposed. 

  -- Fire-retardant material, valued at $23,650, was stored in
     Finland for several months pending the resolution of customs
     problems.  The shipper has claimed about $23,000 in storage
     costs, and this claim is being reviewed by the Pacific Northwest
     National Laboratory. 

The Department of State's Senior Coordinator for Nuclear Safety
Assistance said that customs problems have been raised with
senior-level U.S.  and Russian officials.  Customs difficulties have
been assigned to the Science and Technology Committee of the
Gore-Chernomyrdin Commission for resolution.\10 The Vice President
has repeatedly mentioned his concerns to Russian Prime Minister
Chernomyrdin, and both DOE and the Department of State have attempted
to find a generic solution to the customs issue.  However, pending
such a resolution, case-by-case arrangements will still be required. 

Recently, DOE and Pacific Northwest National Laboratory officials
have focused greater attention on resolving customs problems.  In
February 1996, DOE and Ukrainian authorities agreed to a standardized
process under which nuclear safety-related equipment would be cleared
duty-free by customs in Ukraine.  Laboratory officials said that some
equipment had recently been shipped successfully to Russian plants
using the U.S.  Embassy in Moscow to facilitate the process, although
these officials do not consider this approach to be a long-term
solution.  Some U.S.  industry officials also noted that customs
problems have decreased in recent months. 

Because standardized customs procedures do not yet exist in either
Russia or Ukraine, Pacific Northwest National Laboratory officials
recognize that problems may continue to occur.  These officials noted
that their representative in Russia does, among other things, help
resolve customs problems by working with Russian officials.  Although
the Pacific Northwest National Laboratory has a representative in
Ukraine, his responsibilities are narrowly defined, and he does not
routinely monitor customs issues.  A Laboratory official said that
the Ukraine representative's position may be expanded to more closely
resemble the responsibilities of the program's representative in
Russia. 

In addition to customs problems, other factors have contributed to
delays affecting 5 of the 13 projects we reviewed.  For example,
DOE's project to assist Russia in developing emergency operating
instructions\11 at a pilot nuclear power plant was delayed, in part,
because the Russian organizations responsible for approving the
instructions have been slow to act and have not given the project
priority status.  Although the instructions were drafted in 1992, a
lengthy process of verification, validation, training, and regulatory
approval delayed the implementation of a partial set of instructions
until mid-1996.  In another case, Russian authorities insisted that
some U.S.  fire safety equipment planned for shipment to the Smolensk
plant had to be tested and certified in Russia.  This equipment had
already been approved for U.S.  nuclear power plants.  Testing of the
equipment was delayed for several months because of disagreements
over funding.  During this period, Russian authorities refused to
allow the U.S.  contractor to visit the plant until the matter was
resolved. 

A few U.S.  contractors told us that DOE and the Department of State
have not always been aggressive enough in helping resolve problems. 
In the cases of the emergency operating instructions and the fire
safety equipment for the Smolensk plant, these contractors believed
that DOE should have been more active in working with the appropriate
Russian organizations to help resolve project delays sooner.  One
contractor noted that higher-level DOE officials needed to work more
closely with key Russian officials to demonstrate the U.S. 
government's commitment to the projects' success.  He noted that a
key DOE nuclear safety official helped move the emergency operating
instruction project forward after he had discussed the project with
Russian officials from Rosenergoatom, the organization responsible
for most nuclear power plants' operations in Russia. 


--------------------
\9 The two agreements are the "Agreement Between the Government of
the United States of America and the Government of Ukraine Regarding
Humanitarian and Technical Economic Cooperation" (May 7, 1992), and
the "Agreement Between the Government of the United States of America
and the Government of the Russian Federation Regarding Cooperation to
Facilitate the Provision of Assistance" (Apr.  4, 1992). 

\10 The Commission was created in 1993 to overcome trade barriers in
the energy sector but has expanded into other areas, including
business development, space, science, and technology. 

\11 Emergency (symptom-based) operating instructions are designed to
(1) specify the operator's actions in response to the plant's
changing conditions, (2) allow the operator to stabilize the reactor
without having to first determine the cause for the changing
conditions, and (3) contribute to faster decision-making. 


      CONCERNS WITH COST-SHARING
      ARRANGEMENTS
---------------------------------------------------------- Letter :5.2

In 3 of the 13 projects, Ukraine and Russia have been unable to
adequately finance or support their share of the project.  For
example, a full-scope simulator for the Khmelnytskyy nuclear power
plant in Ukraine, valued at $12.7 million, has been delayed partly by
the plant officials' inability to fulfill their commitments.  As part
of the project, the plant had agreed to provide certain components to
be integrated into the simulator.  However, the parts the plant
provided were corroded.  DOE paid for the replacements.  In addition,
the plant-supplied control room panels did not match the panels
needed for the simulator; DOE paid for their modification as well. 

The simulator project--as well as other projects for which the United
States has agreed to cover additional costs--raises questions about
the ability of host countries to meet commitments in other ongoing
and planned cost-sharing projects for the safety program.  For
example, other simulator projects for Russia and Ukraine are being
developed on a cost-sharing basis with DOE.  The total estimated DOE
contribution to these simulator projects is about $24 million;
Ukraine's contribution is about $12 million; and Russia's
contribution is about $7.5 million.  DOE's simulator project manager
said that some of the recipient countries' contributions will be
"in-kind" contributions of labor, rather than financial outlays. 
However, he said that DOE recognizes that these projects are risky
and that DOE may have some additional costs associated with them. 

In October 1994, a USAID Inspector General's report raised similar
concerns about cost-sharing ventures.\12 The report recommended that
USAID, in coordination with DOE, ensure the development of procedures
defining and documenting the role and use of U.S.  government funding
vis-a-vis host countries' contributions.  According to DOE, the work
plans for each project now include a description of the host
country's expected contribution, which in many cases covers labor
costs. 


--------------------
\12 Audit of the Department of Energy's Nuclear Safety Technical
Assistance Activities in Russia and Ukraine, Regional Inspector
General for Audit, USAID (Oct.  7, 1994). 


      SEVERAL PROJECTS ARE
      PROGRESSING DESPITE DELAYS
---------------------------------------------------------- Letter :5.3

Despite delays, some projects have shown results because the pace of
implementing a number of these safety projects has accelerated in
recent months.  For example, DOE and Brookhaven officials told us
that the cadre of trainers at the Balakovo training center in Ukraine
has grown from less than 10 to about 70 since the project began and
that the plant's management is committed to the training program.  In
another project, NRC has worked closely with Russia's nuclear
regulatory body, Gosatomnadzor, to develop a legislative basis for
nuclear regulation and legal enforcement.  NRC and Gosatomnadzor
officials view this initiative as a significant first step toward the
creation of an independent nuclear regulatory body in Russia. 
Furthermore, we were told that a significant amount of fire safety
equipment has recently been delivered and installed at the
Zaporizhzhya nuclear power plant in Ukraine and emergency power
equipment has recently been installed at the Kola plant in Russia. 


      IT IS TOO EARLY TO ASSESS
      THE IMPACT OF SELECTED
      PROJECTS ON IMPROVED SAFETY
---------------------------------------------------------- Letter :5.4

It is too soon to assess the extent to which the projects we reviewed
are improving safety in Russia and Ukraine because most of these
projects have not been completed.  However, DOE, NRC, and national
laboratory officials--as well as Russian and Ukrainian officials we
met with--believe that the projects are beneficial.  For example, DOE
officials believe the fire safety equipment will reduce the
likelihood of fires and improve detection and fire-fighting
capabilities.  A Russian official from the Smolensk nuclear power
plant told us that the U.S.  fire suits have increased fire fighters'
confidence. 

DOE officials said that they are attempting to measure safety
improvements and to establish meaningful performance measures for the
program.  However, they said that the impact on plant safety of
training, procedures, and changes in the safety culture is not
clearly measurable.  DOE's Director, Office of Nuclear Energy,
Science and Technology and officials at the Pacific Northwest
National Laboratory said that the lack of reliable baseline safety
data makes it impossible for DOE to quantify the extent to which
safety has been improved.  Laboratory officials believe that
measurable safety improvements may take 2 to 5 years. 

DOE has established performance measures that primarily gauge
performance in the technical work areas of the program by accounting
for the number of plants or plant operators carrying out various
tasks or projects.  However, DOE has not yet reported on the results
of these specific measurements.  The Pacific Northwest National
Laboratory is also attempting to gauge the impact of its program by
gathering anecdotal evidence of improvements in nuclear safety.  NRC
has established results-based measurements that will be used to
evaluate its regulatory assistance program. 


   CONCLUSIONS
------------------------------------------------------------ Letter :6

The U.S.  nuclear safety assistance program has evolved into a
longer-term effort than initially envisioned, but DOE has not yet
developed a plan that reflects this effort.  Although DOE has
estimated that it will need $500 million over the next 10 years, it
has not articulated how it will achieve its objectives over this
period.  DOE's development of such a plan--which would link the
program's goals with anticipated costs, outcomes, and time
frames--would go a long way towards gauging how the Department's
assistance is contributing to the improved safety of Soviet-designed
reactors.  It would also serve to provide a better estimate of how
much assistance is required to meet the program's objectives. 

The U.S.  nuclear safety program has faced many challenges and
impediments, such as the lack of a standardized customs process in
Russia and Ukraine.  While DOE has taken a more active role in
resolving customs matters, this problem persists, contributes to
delays, and increases the program's costs.  The Pacific Northwest
National Laboratory has placed a program representative in Russia who
helps resolve customs problems.  Because numerous customs problems
have occurred in Ukraine, we believe that a Laboratory representative
in Ukraine could provide similar program assistance. 


   RECOMMENDATIONS TO THE
   SECRETARY OF ENERGY
------------------------------------------------------------ Letter :7

To improve the management of the nuclear safety assistance program,
we recommend that the Secretary of Energy take the following actions: 

  -- Develop a strategic plan that (1) clearly links the program's
     goals and objectives to performance measurements, (2) provides
     well-defined time frames for completing the program, and (3)
     projects the anticipated funds required to meet the program's
     specific objectives, including the estimated U.S.  contributions
     to cost-sharing arrangements that take into account the
     recipient countries' ability to realistically meet resource
     commitments. 

  -- Facilitate the timely and duty-free delivery of U.S.  safety
     equipment to nuclear power plants in Ukraine.  Specifically, the
     Pacific Northwest National Laboratory's in-country
     representative in Ukraine should, as part of this position's
     assigned duty, work with the appropriate government authorities
     to resolve customs problems should the position assume broader
     responsibilities in the future.  Part of this monitoring
     responsibility could include periodic visits to the nuclear
     power plants in Ukraine. 


   AGENCY COMMENTS
------------------------------------------------------------ Letter :8

We provided copies of a draft of this report to the Departments of
Energy and State, USAID, and NRC.  The Department of State and NRC
generally agreed with the report's findings and provided clarifying
information that we have incorporated into our report, as
appropriate. 

DOE and USAID provided written comments.  DOE disagreed that the U.S. 
assistance program posed a dilemma because it may encourage the
continued operation of the same reactors that the United States wants
to see closed as soon as possible.  DOE noted that the U.S. 
equipment being provided does not extend the life of the reactors. 
We did not assert that the equipment would extend the operating life
of the reactors, but we believe that certain types of equipment could
be used to support the continued operation of higher-risk nuclear
power plants.  For example, DOE's RBMK maintenance initiative
provides the equipment, training, and technology that enables the
plant's components to remain in service longer, thus supporting the
plant's continued operations while improving plant safety.  (See app. 
VI for DOE's comments and our response.)

USAID noted that our report (1) understated the overall level of
progress being made by the U.S.  assistance program and (2) gave the
impression that no progress is being made toward obtaining the
closure of the highest-risk Soviet-designed reactors.  Regarding the
first point, our report noted that several projects in our sample had
made progress, resulting in, for example, the installation of
safety-related hardware.  However, we also noted that it was
premature to assess the impact of these projects because only one had
been completed.  Regarding the second point, our report provided
several examples of closure commitments that have been made but also
stated that it will be difficult for the countries to meet specific
closure dates.  We also noted that, to date, no reactors have been
closed, and one was recently restarted.  (See app.  VII for USAID's
comments and our response.)


   SCOPE AND METHODOLOGY
------------------------------------------------------------ Letter :9

To address our objectives, we interviewed officials and obtained
documentation from the Department of State, USAID, DOE, NRC, and the
Brookhaven and Pacific Northwest National Laboratories.  We also met
with some government officials and nuclear power plant personnel from
Russia and Ukraine.  We reviewed 13 of approximately 196 ongoing DOE
and NRC nuclear safety projects to determine how they are being
implemented and are contributing to improved nuclear safety.  Agency
officials agreed that our selection included projects that represent
the safety program's highest priorities.  Our scope and methodology
are discussed in detail in appendix V. 

We performed our review from January 1996 through August 1996 in
accordance with generally accepted government auditing standards. 

We plan no further distribution of this report until 15 days from the
date of this letter unless you publicly announce its contents
earlier.  At that time, we will send copies of this report to other
interested congressional committees, the Secretaries of State and
Energy, the Chairman of NRC, the Administrator of USAID, the Director
of the Office of Management and Budget, and other interested parties. 
We will also make copies available to others on request. 


---------------------------------------------------------- Letter :9.1

Please contact me at (202) 512-3841 if you or your staff have any
questions.  Major contributors to this report are listed in appendix
VIII. 

Sincerely yours,

Victor S.  Rezendes
Director, Energy, Resources,
 and Science Issues


DOE'S AND NRC'S NUCLEAR SAFETY
ASSISTANCE COSTS
=========================================================== Appendix I

This appendix provides detailed information on the Department of
Energy's (DOE) and the Nuclear Regulatory Commission's (NRC) planned
and actual costs for the U.S.  nuclear safety assistance to improve
the safety of Soviet-designed nuclear reactors. 

   Figure I.1:  Planned
   Distribution of Funds Totaling
   $13.8 Million for DOE's
   Chornobyl Project

   (See figure in printed
   edition.)

Source:  DOE. 



                                        Table I.1
                         
                          Obligations and Expenditures for DOE's
                         and NRC's Safety Assistance Programs, as
                                    of March 31, 1996

                                  (Dollars in thousands)

                                                                 Percent of    Percent of
                                                                      funds         funds
Agency and                                Funds         Funds  received and      received
recipient          Funds received   obligated\a      expended     obligated         spent
-----------------  --------------  ------------  ------------  ------------  ------------
DOE
Russia                   $101,294      $ 61,619       $37,388            61            37
Ukraine                    64,006        47,879        34,200            75            53
CEEC\b                     14,750         9,711         6,701            66            45
=========================================================================================
Subtotal                 $180,050      $119,209       $78,289            66            43
NRC
Russia                   $ 10,650       $ 5,247       $ 3,430            49            32
Ukraine                    11,570         6,199         2,991            54            26
CEEC\b                      5,748         5,058         4,616            88            80
=========================================================================================
Subtotal                 $ 27,968      $ 16,504       $11,037            59            39
=========================================================================================
Total                    $208,018      $135,713      $ 89,326            65            43
-----------------------------------------------------------------------------------------
Note :  Does not include U.S.contributions to the Nuclear Safety
Account totaling $25 million.  This account is administered by the
European Bank for Reconstruction and Development.  It also does not
include $300,000 for NRC projects in Kazakhstan and Armenia. 

\a Occurs when a definite commitment has been made or a legal
liability is incurred. 

\b Central and Eastern European Countries. 

Sources:  Pacific Northwest National Laboratory (PNNL) and NRC. 

   Figure I.2:  DOE's and NRC's
   Cumulative Expenditures
   Totaling $42.2 Million for
   Nuclear Safety-Related
   Equipment and Products

   (See figure in printed
   edition.)

Notes:  Includes expenditures for equipment that has either been
delivered or authorized for shipment as of Mar.  31, 1996.  Does not
include labor, travel, and other direct and overhead costs for the
engineering and support services to specify, acquire, and deliver
these products.  Includes $2.6 million for RBMK-related expenditures. 

Sources:  PNNL and NRC. 



                                        Table I.2
                         
                          DOE's Cumulative Expenditures for the
                         Nuclear Safety Assistance Program, as of
                                      March 31, 1996

                                  (Dollars in thousands)

                                      DOE Activity
-----------------------------------------------------------------------------------------
                                                                 BAO/             Percent
Element of cost       DOE    PNNL     BNL     ANL        CH      ORNL     Total  of total
---------------  --------  ------  ------  ------  --------  --------  --------  --------
Labor\a                $0  $4,157  $5,142    $178        $0       $41    $9,518        12
Travel\b              480     888   1,861     170         0         6    $3,405         4
Materials/          5,856   9,788  20,730   2,664     8,166         0   $47,204        60
 subcontracts\c
Other direct        1,020   1,196   3,471      85         0         0    $5,772         7
 costs\d
Overhead\e              0   5,323   6,740     328         0         0   $12,391        16
=========================================================================================
Total              $7,356  $21,35  $37,94  $3,425    $8,166       $47   $78,290        99
                                2       4
-----------------------------------------------------------------------------------------
Legend: 

DOE - DOE Headquarters Activity
PNNL - Pacific National Northwest Laboratory
BNL - Brookhaven National Laboratory
ANL - Argonne National Laboratory
CH - Chicago Area Office
BAO/ORNL - Brookhaven Area Office and Oak Ridge National Laboratory

Note:  Total does not equal 100 percent due to rounding. 

\a Includes salaries, wages, and pensions that are directly
chargeable to the international nuclear safety program.  DOE
headquarters' employees' salaries are not charged directly to the
program. 

\b Includes travel and per diem costs--foreign or domestic--of DOE
and laboratory officials.  Does not includes travel and per diem
costs of foreign nationals under the program; these costs are
included in "materials/subcontracts."

\c Includes directly applicable purchase orders, subcontracts, and
consulting services.  Contractor labor, travel, and overhead charges
are included in this category.  Also included in this amount is $38.8
million in safety-related equipment and products. 

\d Includes the costs of certain centralized services, including
translation of documents. 

\e Includes charges for organizational overhead, general and
administrative expenses, and service assessments. 

Source:  PNNL. 



                               Table I.3
                
                 NRC's Cumulative Expenditures for the
                Nuclear Safety Assistance Program, as of
                             March 31, 1996

                         (Dollars in thousands)

Expenditure                                                     Amount
----------------------------------------  ----------------------------
Contractor personnel                                            $4,918
Travel\a                                                         2,792
Training                                                           193
Equipment                                                          504
Computer codes\b                                                 2,600
Other                                                               29
======================================================================
Total                                                          $11,036
----------------------------------------------------------------------
Notes:  NRC headquarters employees' salaries are not charged directly
to the program.  The expenditures in this table are different than
the NRC expenditures shown on table I.1 due to rounding. 

\a Includes travel and per diem expenditures of NRC and foreign
national officials. 

\b Transfer and training in the use of computer programs used by NRC
for safety analysis and participation in user groups. 

Source:  NRC. 


SUMMARY OF 13 DOE AND NRC SAFETY
PROJECTS AND PRIMARY REASONS FOR
DELAYS
========================================================== Appendix II

Safety                                                    Other
projec     Project  Project                   Customs     impediment  Cost-
ts        value \a  status        Liability   problems    s\b         sharing
------  ----------  ------------  ----------  ----------  ----------  ----------
Kola          $3.5  Delayed.      Yes         Yes         No          No
Batter              Plan to
y                   complete in
Upgrad              9/1996.
es
(Russi
a)

Kursk          2.1  Delayed.      Yes         No          No          No
Batter              Plan to
y                   complete in
Upgrad              12/1996.
es
(Russi
a)

Smolen         4.5  Delayed.      Yes         Yes         Yes         No
sk                  Plan to
Fire                complete in
Protec              11/1996.
tion
(Russi
a)

Zapori         1.8  Delayed.      Yes         No          No          No
zhzhya              Plan to
Fire                complete in
Protec              12/1996.
tion
(Ukrai
ne)

Emerge        13.5  Delayed.      No          No          Yes         Yes
ncy                 Plan to
Operat              complete in
ing                 12/1998.
Instru
ctions


Zapori         6.6  Delayed.      No          Yes         No          Yes
zhzhya              Plan to
Dry                 complete in
Cask                9/1996.
Storag
e
(Ukrai
ne)

Khmeln        12.7  Delayed.      No          Yes         Yes         Yes
ytskyy              Plan to
Full-               complete in
Scope               11/1997.
Simula
tor
(Ukrai
ne)

Balako         9.7  Plan to       No          Yes         No          No
vo                  complete in
Traini              6/1997.
ng
Center
(Russi
a)

Joint          2.0  Completed in  No          No          Yes         No
Nuclea              6/1995.
r
Study
(Russi
a)

Legisl          .6  Delayed.      No          No          No          No
ative               Plan to
Basis               complete in
for                 12/1996.
Nuclea
r
Regula
tion
(Russi
a)

Incide         1.5  Delayed.      No          Yes         No          No
nt                  Plan to
Respon              complete in
se                  9/1997.
Center
(Russi
a)

Analyt       6.0\c  Delayed.      No          No          No          No
ical                Plan to
Simula              complete in
tors                6/1999.
(Russi
a and
Ukrain
e)

Probab         2.5  Delayed.      No          No          Yes         No
listic              Plan to
Risk                complete in
Assess              5/1998.
ments
(Russi
a)
--------------------------------------------------------------------------------
\a Project values expressed in millions of dollars. 

\b Includes the imposition of burdensome requirements and/or lack of
"buy-in" by foreign authorities. 

\c Total planned value of the project. 

Source:  Based on data provided by DOE and NRC. 


DEPARTMENT OF ENERGY SAFETY
ASSISTANCE PROJECTS
========================================================= Appendix III

This appendix discusses nine nuclear safety projects we reviewed that
DOE has completed or is implementing in Russia and Ukraine.  These
projects, which have a total value of about $56 million, include a
training center in Russia, a full-scope simulator in Ukraine,
emergency power systems in Russia, fire safety equipment in Russia
and Ukraine, spent fuel storage in Ukraine, emergency operating
instructions for Soviet-designed nuclear reactors, and a study of
nuclear energy options for Russia.\1


--------------------
\1 Tables III.1-III.2, III.4-III.9, and III.11 reflect DOE's national
laboratory expenditures.  The category subcontractor/materials
includes expenditures incurred by subcontractors, including travel,
labor, and overhead. 


   TRAINING CENTER AT THE BALAKOVO
   NUCLEAR POWER PLANT
------------------------------------------------------- Appendix III:1

The Balakovo training center in Russia is one of the two regional
training centers established by the 1992 Lisbon Initiative on
Multilateral Nuclear Safety.  The purpose of the training center is
to teach a systematic approach to training--the measurable,
performance-based training program used for U.S.  nuclear power plant
personnel--to Balakovo plant personnel.  The systematic approach to
training is used as a method to develop or improve training programs
for operations, maintenance and other technical support personnel. 
DOE expects that this training approach will eventually be
transferred from Balakovo to the other VVER-1000 designed plants in
Russia. 


      PROJECT COSTS
----------------------------------------------------- Appendix III:1.1

As of March 31, 1996, DOE had allocated $9.4 million for the Balakovo
training center and had obligated $9.7 million.  About $4.3 million
had been spent, as seen in table III.1. 



                              Table III.1
                
                   Expenditures for Balakovo Training
                      Center, as of March 31, 1996

Expenditure                                                     Amount
----------------------------------------  ----------------------------
Labor                                                         $243,025
Travel                                                         222,816
Subcontracts/materials                                       3,189,804
Overhead\a                                                     674,750
======================================================================
Total                                                       $4,330,395
----------------------------------------------------------------------
\a Includes charges for organizational overhead, general and
administrative expenses, and service assessments. 

Sources:  Brookhaven National Laboratory and Pacific Northwest
National Laboratory (PNNL). 


      PROJECT STATUS
----------------------------------------------------- Appendix III:1.2

The Balakovo training center project was started in April 1993 and is
expected to be completed by June 1997.  However, training for other
VVER 1000 plant operators in Russia may continue beyond 1997. 
According to DOE and Brookhaven officials and representatives from
Sonalysts, Inc.  (the U.S.  contractor), no major delays have
occurred in implementing the project because of the high level of
cooperation from Balakovo plant management and Russian authorities. 

By working cooperatively with Balakovo plant personnel, DOE,
Brookhaven, and Sonalysts, Inc.  developed 12 job-specific training
courses and 6 general training courses for the plant.  As of May
1996, 6 of the 12 job-specific training programs and 3 of the 6
general courses had been completed. 

Along with the training, DOE is providing both course-specific
equipment and equipment for the training center, such as circuit
boards, soldering work stations, laser alignment equipment,
computers, printers, and audiovisual equipment.  Equipment shipped
from the United States to the Balakovo training center has
experienced some customs problems.  According to the Brookhaven
project manager, in one instance the plant paid a substantial amount
to get a shipment of equipment out of customs storage.  Two shipments
of spare parts for a full-scope simulator for the training center,
valued at $45,500, have been held in U.S.  airport storage since
August and September 1995 awaiting approval from Rosenergoatom
(REA),\2 for shipment.  However, this Brookhaven official told us
that, more recently, some equipment had been shipped successfully to
the plant by using the U.S.  Embassy in Moscow to facilitate
clearance.  For example, about $22,000 in soldering equipment that
had been held in storage in Helsinki, Finland, since July 1995,
pending resolution of the customs issue, was delivered to the plant
in April 1996. 

DOE considers the Balakovo training center to be a success because of
the plant management's commitment to the training.  In a March 1996
letter to DOE, the Balakovo plant manager stated that the training
program was a success because of the effective interaction between
the Russian and U.S.  sides and the fact that the training approach
had been applied to specific conditions at the plant.  According to
the Brookhaven project manager, the size of the Balakovo training
center staff has grown from less than 10 in 1992-93 to about 70 in
1996, and instructors' salaries are the same as plant operators.  As
of March 1996, about 600 personnel at Balakovo had been trained on
material developed with U.S.  assistance.  Plant personnel have also
begun to develop training material for additional duty areas and to
train other personnel.  Approximately 5,000 plant personnel require
job-specific training. 

In a November 1995 meeting with DOE, officials from Russia's Ministry
of Atomic Energy (Minatom) said that they were pleased with the
training program at Balakovo and wanted to adopt the training method
to other VVER-designed plants in Russia.  In April 1996, Brookhaven's
project manager met with Russian officials and agreed to a plan to
transfer the training approach to other Russian plants.  Because
Balakovo does not have the resources to transfer the training
approach to other plants, DOE agreed to continue to assist Russian
organizations and Balakovo with additional training. 


--------------------
\2 Rosenergoatom is the organization in Russia's Ministry of Atomic
Energy that is responsible for all nuclear power plant operations in
Russia, except for the Leningrad nuclear power plant. 


   FULL-SCOPE SIMULATOR FOR
   KHMELNYTSKYY NUCLEAR POWER
   PLANT
------------------------------------------------------- Appendix III:2

The other regional training center in Khmelnytskyy, Ukraine,
established by the 1992 Lisbon Initiative, will feature a
computer-based simulator for the VVER-1000 reactor, as seen in figure
III.1. 

   Figure III.1:  Example of a
   Full-Scope Simulator

   (See figure in printed
   edition.)

   Source:  PNNL.

   (See figure in printed
   edition.)

DOE is purchasing a full-scope simulator for the Khmelnytskyy
training center so that plant personnel can upgrade and maintain
their operational skills in dealing with routine and abnormal events
at the plant.  DOE officials and representatives from S-3
Technologies, Inc.  (the U.S.  contractor) believe that the transfer
of simulator technology to Ukrainian personnel will have long-term
benefits.  The simulator technology is being transferred to a
Ukrainian team that will maintain and modify the Khmelnytskyy
simulator and build and maintain simulators for the other nuclear
power plants in Ukraine.  As a part of this technology transfer, a
Ukrainian company has learned how to manufacture control room panels,
a key component of the simulator, that meet U.S.  standards. 

The United States and Ukraine are working together to develop the
simulator.  S-3 Technologies, Inc.  is designing, developing,
testing, and installing the simulator in Ukraine and is providing
training and support to the technology transfer team.  As a part of
the simulator development activities, the Ukrainians agreed to
provide plant data, control room panels, and instruments, and to host
a U.S.  team in Ukraine for about a year.  Brookhaven National
Laboratory subcontracted with a Ukrainian company to modify the
control room panels for the simulator.  The Ukrainians also agreed to
construct a building at the Khmelnytskyy training center to house the
simulator. 


      PROJECT COSTS
----------------------------------------------------- Appendix III:2.1

As of March 31, 1996, DOE had allocated $11.7 million for the
simulator project against a total estimated cost of $12.7 million. 
It had obligated $11.7 million and had spent $8.5 million of this
amount.  Table III.2 shows these expenditures in greater detail. 
Most of the funding has come from the Department of Defense, which
transferred $11 million to Brookhaven to build the simulator in
November 1994.  DOE allocated an additional $500,000 for development
of the project specifications.  Because of project delays and
unanticipated costs, DOE has since added $1.2 million to the project. 



                              Table III.2
                
                Expenditures for Khmelnytskyy Simulator,
                          as of March 31, 1996

Expenditure                                                     Amount
----------------------------------------  ----------------------------
Labor                                                         $447,237
Travel                                                         127,910
Subcontracts/materials                                       7,377,251
Overhead                                                       555,688
======================================================================
Total                                                       $8,508,086
----------------------------------------------------------------------
Sources:  Brookhaven National Laboratory and PNNL. 

Included in these expenditures is $596,724 that DOE paid for travel,
lodging, and other expenses for 22 Ukrainian technology team members
who lived in the United States for approximately one year.  (See
table III.3.) Of that amount, $26,298 was for airfare that DOE or S-3
Technologies, Inc.  paid for 12 Ukrainian spouses who traveled to the
United States and 4 team members who traveled home, for about one
month.  According to a representative of S-3 Technologies, Inc., one
member of the project team, a Ukrainian computer specialist, left the
program to work for a U.S.  computer firm and was replaced.  PNNL
officials, who authorized the payments, were not aware that the
Ukrainian team member had left the project under these circumstances
until we brought it to their attention.  They noted, however, that
they were led to believe that the team member had personal problems
that caused his absence from the program.  Furthermore, these
officials stated that no inappropriate payments were made to the team
member. 



                              Table III.3
                
                 Expenditures for Ukrainian Technology
                  Transfer Team, as of March 31, 1996

Expenditure                                                     Amount
----------------------------------------  ----------------------------
Apartments, per diem, car rentals,                            $487,522
 health insurance
Travel for team                                                 80,321
Additional travel for spouses and team                          26,298
Visas                                                            2,583
======================================================================
Total                                                         $596,724
----------------------------------------------------------------------
Source:  S-3 Technologies, Inc.  and PNNL. 


      PROJECT STATUS
----------------------------------------------------- Appendix III:2.2

The simulator project was originally expected to be completed by
December 1996, and, according to DOE and Brookhaven project
officials, is now expected to be completed by November 1997.  Several
events have contributed to project delays, including (1) a 9-month
delay in receiving Department of Defense funds, (2) the reluctance of
Khmelnytskyy plant management to provide complete and accurate plant
data in a timely manner, (3) the unanticipated modification of
Ukrainian-supplied control room panels, (4) the need to replace
defective simulator instruments supplied by Ukraine, and (5) customs
problems. 

The Ukrainians have had difficulties in fulfilling their agreements
in a timely manner.  This has led to project delays and unanticipated
costs.  An S-3 Technologies representative told us that the
Khmelnytskyy plant management was hesitant to release plant data to
his company and had asked for payment for the data collection effort. 
S-3 Technologies eventually received the plant data without paying
for it.  Furthermore, the plant did not provide complete and timely
delivery of the control room panels and instruments that are required
for assembling the simulator.  DOE paid $389,000 to modify the
control panels.  In addition, because the crates containing the
instruments and switches had been stored outside for 3 years, the
switches were rusted and needed to be replaced, at a cost of about
$52,600 to DOE.  DOE has also agreed to pay about $30,000 for lodging
costs for the U.S.  contractor personnel who will be living in
Ukraine for one year.  Ukraine had originally agreed to cover these
costs as well. 

Difficulties with customs have also contributed to delays in
assembling the control room panels for the simulator.  In a 1995
letter to DOE, an official with Ukraine's state-owned nuclear power
utility said that clearance of certain equipment had been held up
because representatives of the U.S.  Agency for International
Development(USAID) mission in Kiev were unaware that the deliveries
were part of DOE's technical assistance program.  In February 1996,
the Khmelnytskyy plant's general director noted in a letter to
Brookhaven National Laboratory that the simulator project would be
jeopardized if the customs problems were not resolved.  In February
1996, DOE signed a protocol with Goscomatom, Ukraine's nuclear power
utility, to facilitate future deliveries of nuclear safety equipment
from the United States to Ukraine.  In January 1996, two shipments of
simulator parts were delivered to a customs warehouse in Ukraine, but
they were not released until U.S.  officials visited the plant in
April 1996.  During this visit, DOE's project manager told us that he
agreed to have S-3 Technologies pay customs fees of between $2,000
and $3,000 to release a third shipment of simulator equipment. 

DOE and Brookhaven officials and representatives of S-3 Technologies
are concerned that the training center building that will house the
simulator will not be completed on time.  During U.S.  officials'
July 1996 visit to the plant, Pacific Northwest National Laboratory
representatives reported that the training center building would be
completed in August 1996.  The control panels are also expected to be
completed and installed in August 1996. 

About 16 to 18 S-3 Technology personnel will travel to the
Khmelnytskyy plant in the fall of 1996 to integrate the simulator
hardware with the software and to test and verify the simulator.  The
Khmelnytskyy team members will assist the U.S.  contractors in
testing the simulator in Ukraine.  In addition, members of the
technology transfer team representing Goscomatom will work at the
Ukraine simulator support center in Kiev developing other simulators
for Ukraine, such as one for the Rivne nuclear power plant. 


   EMERGENCY POWER SUPPLY
   EQUIPMENT FOR KOLA AND KURSK
   NUCLEAR POWER PLANTS
------------------------------------------------------- Appendix III:3

DOE is providing batteries and related equipment to improve the
emergency power supply systems of the Kola and Kursk nuclear power
plants in Russia.\3 The batteries are used to provide electricity so
that safety systems can function during a power outage, and the
performance of most nuclear power plant safety systems depends on the
availability of emergency power.  The equipment will replace existing
Russian-manufactured batteries that are not enclosed and present
potential safety hazards.  In the case of Kola, the new batteries are
seismically qualified and meet U.S.  safety standards.  At Kursk,
batteries will be of two types:  seismically qualified and
commercial. 

In both projects, the U.S.  contractor, Burns and Roe, is responsible
for developing specifications, purchasing and delivering the
equipment, and monitoring equipment installation.  The major pieces
of equipment are being purchased in the United States.  Figures III.2
and III.3 show existing batteries and U.S.- provided replacements. 

   Figure III.2:  Batteries
   Currently Used at Kursk Nuclear
   Power Plant

   (See figure in printed
   edition.)

   Source:  PNNL.

   (See figure in printed
   edition.)

   Figure III.3:  U.S. 
   Seismically Qualified Batteries
   for Kola Nuclear Power Plant

   (See figure in printed
   edition.)

   Source:  PNNL.

   (See figure in printed
   edition.)


--------------------
\3 DOE is providing the equipment to two VVER-440/230 units at Kola
and one RBMK unit at Kursk. 


      PROJECT COSTS
----------------------------------------------------- Appendix III:3.1

DOE has allocated approximately $3.5 million for the Kola project and
about $2.1 million for Kursk.  As of March 31, 1996, DOE had
obligated $3 million and spent about $2.9 million for Kola and had
obligated $2.1 million and spent about $607,000 for Kursk.  Tables
III.4 and III.5 provide an analysis of expenditures for the two
projects. 



                              Table III.4
                
                Expenditures for Emergency Power Supply
                 Equipment at Kola Nuclear Power Plant,
                          as of March 31, 1996

Expenditure                                                     Amount
----------------------------------------  ----------------------------
Labor                                                          $18,274
Travel                                                           1,966
Subcontracts/materials                                       2,936,327
Direct Costs                                                         0
Overhead                                                        17,798
======================================================================
Total                                                       $2,974,365
----------------------------------------------------------------------
Source:  Brookhaven National Laboratory and PNNL. 



                              Table III.5
                
                Expenditures for Emergency Power Supply
                Equipment at Kursk Nuclear Power Plant,
                          as of March 31, 1996

Expenditure                                                     Amount
----------------------------------------  ----------------------------
Labor                                                           $1,249
Travel                                                               0
Subcontracts/materials                                         604,678
Direct costs                                                         0
Overhead                                                           901
======================================================================
Total                                                         $606,828
----------------------------------------------------------------------
Source:  Brookhaven National Laboratory and PNNL. 


      PROJECT STATUS
----------------------------------------------------- Appendix III:3.2

DOE's project manager told us that both the Kola and Kursk battery
upgrade projects were initially delayed for about one year because of
Brookhaven's and U.S.  contractors' concerns about nuclear liability. 
These concerns resulted in the transfer of overall program management
from Brookhaven to Pacific Northwest National Laboratory.\4 The Kola
project, started in 1994, was originally expected to be completed by
July 1995.  DOE currently estimates that the project should be
completed by September 1996.  After the initial delay, DOE has
proceeded according to schedule and the manufacture of the batteries
is to be completed by July 1996.  Installation will be completed when
the reactor goes off line temporarily for routine maintenance. 

A representative from the U.S.  contractor, Burns and Roe, noted that
delays in the Kola project were also due to changes when the plant
management decided to perform routine maintenance that forced the
contractor to reschedule battery installation.  The Kola project,
like other projects we reviewed, also experienced customs problems,
but these problems did not affect the project schedule, which had
already been delayed.  For example, in November 1995, equipment for
the Kola project was shipped from the United States to Russia.  As
instructed by DOE, Burns and Roe held the equipment at a storage
warehouse in the Netherlands pending resolution of customs issues. 
The equipment remained at the warehouse from November 1995 through
early January 1996, when it was cleared for release and shipped to
the plant.  The warehouse charged the U.S.  shipping agent $11,292
for storage fees, and DOE will be asked to reimburse the shipper for
the fees. 

Despite these customs problems, according to the Burns and Roe
representative, all of the Kola-related equipment has been delivered
and the batteries for one of the units have been installed.  This
includes approximately $1.6 million for batteries, battery trays, and
switchboards.  Approximately $100,000 in similar equipment has been
delivered to Kursk.  The remainder of the equipment is scheduled for
shipment in August 1996.  DOE estimates that the Kursk project will
be completed in December 1996. 


--------------------
\4 The management of the emergency power supply equipment and fire
safety equipment projects were also transferred at this time from
Brookhaven to DOE. 


   FIRE SAFETY EQUIPMENT FOR THE
   SMOLENSK NUCLEAR POWER PLANT
------------------------------------------------------- Appendix III:4

DOE is providing fire safety equipment to the Smolensk nuclear power
plant in Russia to reduce the risk of fires and minimize their effect
should they occur.\5 Smolensk was selected as a pilot project by DOE
in 1993, with the expectation that equipment would be delivered
quickly to demonstrate the effectiveness of the U.S.  safety program. 
In 1993, Brookhaven, which was initially assigned responsibility for
project management by DOE, selected Bechtel Power Corporation to
implement the project.  Major items of equipment to be provided
include fire suits, smoke detectors, fire doors, fireproofing
materials, and radios.  Figure III.4 shows an existing fire door at
Smolensk and a sample replacement door is shown in figure III.5. 
Fire-fighting suits, already delivered to the plant, are shown in
figure III.6. 

   Figure III.4:  Existing Wooden
   Fire Door at Smolensk Nuclear
   Power Plant

   (See figure in printed
   edition.)

   Source:  PNNL.

   (See figure in printed
   edition.)

   Figure III.5:  Prototype Metal
   Fire Door to be Installed at
   Smolensk Nuclear Power Plant

   (See figure in printed
   edition.)

   Source:  PNNL.

   (See figure in printed
   edition.)

   Figure III.6:  Fire-Fighting
   Suits Provided to Smolensk
   Nuclear Power Plant

   (See figure in printed
   edition.)

   Source:  PNNL.

   (See figure in printed
   edition.)


--------------------
\5 The Smolensk nuclear power plant has three RBMK reactors, all of
which began operating between 1983 and 1990. 


      PROJECT COSTS
----------------------------------------------------- Appendix III:4.1

The estimated value of the project is $4.5 million.  As of March 31,
1996, $2.7 million had been obligated, and about $1.3 million had
been spent, as shown in table III.6. 



                              Table III.6
                
                 Expenditures for Smolensk Fire Safety
                    Equipment, as of March 31, 1996

Expenditure                                                     Amount
----------------------------------------  ----------------------------
Labor                                                          $57,603
Travel                                                           4,306
Subcontracts/materials                                       1,173,313
Other Direct Costs                                               5,053
Overhead                                                        82,205
======================================================================
Total                                                       $1,322,480
----------------------------------------------------------------------
Sources:  Brookhaven National Laboratory and PNNL. 


      PROJECT STATUS
----------------------------------------------------- Appendix III:4.2

Numerous factors have delayed implementation of the Smolensk fire
safety project, including (1) nuclear liability concerns that led to
changes in U.S.  project management, (2) customs problems, and (3)
the lack of cooperation from key Russian organizations.  According to
a Bechtel representative, nuclear liability concerns--and the
resulting change in DOE's project management--contributed to an
8-month delay because additional contracts were not awarded to
continue the work.  As a result of these problems, the project has
missed performance-related milestones.  The project, which began in
August 1993, was initially expected to be completed by December 1994. 
DOE now estimates that the project should be completed by November
1996.  A Smolensk plant official told us that he appreciated the U.S. 
assistance but was disappointed that the fire safety equipment has
not been delivered sooner.  He said that the Russian bureaucracy has
created many difficulties for the plant and the equipment is urgently
needed. 

With respect to customs problems, in October 1994, a shipment of fire
safety equipment, including 100 fire suits and fire hose nozzles
valued at about $110,000, was impounded by Russian customs officials
pending payment of the applicable customs taxes.  When the Smolensk
plant refused to pay, the customs office brought the matter before a
local court.  The customs office noted that as a private enterprise,
it was responsible for generating income.  The court agreed and
upheld the assessment.  Because no duty was paid, the court
subsequently declared the items abandoned and the property of the
state.  In January 1995, the court released the shipment to the fire
department of a regional capital located approximately 100 miles from
the nuclear power plant.  After discovering that the fire suits had
the name of the power plant's fire safety brigade labeled across the
back in English, the city fire department notified the power plant. 
In September 1995, almost one year after the shipment had arrived at
Smolensk, the equipment was sent to the nuclear power plant's fire
brigade. 

Because of the uncertainties associated with the customs clearance
process, DOE decided to hold a $23,650 shipment of fire protection
equipment destined for Smolensk in Helsinki, Finland.  This
equipment, primarily fire-retardant material, was stored at Helsinki
in March 1995 and delivered to the plant in early January 1996. 
According to the Pacific Northwest National Laboratory, the shipper
has reported storage costs of about $23,000, and the Laboratory is
reviewing the reasonableness of this claim. 

In another instance, approximately $5,000 in fire safety
equipment--including one sample fire door--was lost on its way to the
Smolensk nuclear power plant.  Also included in the missing items
were power transformers, cable wire, and a power distribution panel
for a fire detection system.  According to DOE, the items were fully
insured and were replaced with no operational or financial impact on
the project. 

DOE and Pacific Northwest National Laboratory representatives and
Bechtel officials also cited difficulty in working with Rosenergoatom
to resolve difficulties in obtaining Russian certification for
U.S.-supplied equipment.  In April 1994, Rosenergoatom informed
Bechtel that a considerable portion of U.S.-supplied equipment would
have to be tested in Russia before it could be installed.  The
equipment identified for testing included fire brigade clothing,
floor coating material, and fire doors.  In April 1994, Rosenergoatom
officials informed U.S.  officials that none of the sample equipment
previously left at the plant had been officially approved or
certified because of the lack of funding.  Rosenergoatom requested
that the United States pay for the testing.  Brookhaven National
Laboratory agreed, but payment was delayed because of nuclear
liability issues and the eventual change in DOE's program management. 

The Pacific Northwest National Laboratory subsequently agreed to pay
about $60,000 to Rosenergoatom for testing, but the contract was
never signed because Rosenergoatom and the testing facility were
unable to agree on how to share the anticipated U.S funds.  During
this period, Rosenergoatom refused to allow the U.S.  contractor to
visit the plant.  In December 1995, after an absence of more than 2
years, Bechtel representatives were allowed to visit.  According to
DOE officials, Rosenergoatom and the plant are now accepting most of
the materials without additional testing. 

Both U.S.  and Russian officials from the Smolensk nuclear power
plant believed that the fire safety equipment will ultimately have a
beneficial effect, even though only a portion of the fire safety
equipment has been delivered or installed.  A Smolensk plant official
told us that the fire suits have already had an impact because the
firefighters are less hesitant to perform their jobs because they
have improved equipment.  He also noted that the plant needs more
U.S.  equipment than is currently planned in order to make
comprehensive safety improvements. 


   SPENT-FUEL STORAGE FOR
   ZAPORIZHZHYA NUCLEAR POWER
   PLANT
------------------------------------------------------- Appendix III:5

DOE is assisting Ukraine in developing on-site spent-fuel storage
capacity at the Zaporizhzhya nuclear power plant in Ukraine so that
the plant does not have to continue to pay for spent-fuel
reprocessing in Russia.\6 According to DOE officials, without
adequate spent-fuel storage capacity at Zaporizhzhya, Ukraine might
be forced to shut down some of its plants and continue to operate
Chornobyl to compensate for lost power production. 

A key objective of the project is to transfer technology so that
Ukraine can eventually manufacture the entire storage unit.  This
unit consists primarily of a concrete outer shell, a steel inner cask
liner, and an inner basket, which holds the spent-fuel rods.  For the
DOE-funded portion of the project, U.S.  vendors are supplying most
of the metal materials and manufacturing major internal cask
components for three storage cask (spent-fuel) systems.  The
components will be shipped to Ukraine for final assembly.  Ukraine
will be responsible for constructing the three concrete outer shells
that will hold the spent fuel and will perform welding tasks. 
Ukraine is also providing certain materials and hardware.  The goal
is to provide Ukraine with the capability to manufacture the entire
unit.  DOE officials believe that once the technology is fully
transferred, Ukraine will be able to manufacture about 12 casks per
year in order to eventually allow the plant to become self-sufficient
in managing spent fuel.  Additionally, DOE officials believe that, if
successful, Ukraine could export the casks. 

While DOE officials noted that the project is not directly related to
improving the safety of Soviet-designed reactors, it nonetheless is a
high-priority program for Ukraine and the United States.  DOE
believes that the technology transfer element of this project is
essential to the program's success.  Additionally, the role of the
Ukrainian regulatory body in monitoring the design and construction
of the casks is central to DOE's emphasis on including the regulator
in all aspects of nuclear safety.  While these benefits may be
achieved, Ukraine's limited resources raise questions about the
number of casks it can ultimately manufacture.  According to the
contractor, hundreds of casks will be required to have a significant
impact on improving capacity for on-site waste storage. 


--------------------
\6 Zaporizhzhya operates six VVER Model 1000 reactors, the most
modern Soviet-designed reactors. 


      PROJECT COSTS
----------------------------------------------------- Appendix III:5.1

In December 1993, Ukraine's nuclear utility entered into an agreement
with Duke Engineering and Services to supply Zaporizhzhya with 14
spent-fuel storage units valued at approximately $14 million. 
Subsequently, Ukraine requested that DOE help fund the project.  DOE
agreed to fund $6.6 million of the total cost for the production of
the first three casks.  As of March 31, 1996, DOE had obligated $6.5
million and had spent about $5 million on the project.  Table III.7
shows the expenditures in greater detail. 



                              Table III.7
                
                Expenditures for Zaporizhzhya Spent Fuel
                 Storage Project, as of March 31, 1996

Expenditure                                                     Amount
----------------------------------------  ----------------------------
Labor                                                         $171,478
Travel                                                          16,144
Subcontracts/materials                                       4,386,079
Other indirect costs                                            87,915
Overhead                                                       301,826
======================================================================
Total                                                       $4,963,442
----------------------------------------------------------------------
Sources:  Brookhaven National Laboratory and PNNL. 


      PROJECT STATUS
----------------------------------------------------- Appendix III:5.2

The overall pace of the project has been slow, although training has
been provided to the Ukrainian regulator and plant staff and some
equipment has been purchased and delivered.  The project has faced
significant impediments and is more than 6 months behind schedule; it
was initially set for completion by the end of March 1996.  DOE
estimates that the project will now be completed after September
1996.  At the time of our review, none of the casks had been built. 
The primary reasons for the delay are (1) a series of unanticipated
design changes required by the Zaporizhzhya power plant and (2)
greater-than-anticipated time to obtain a Ukrainian construction
license.  A U.S.  contractor's representative told us that the
plant's management has changed, causing interruptions in program
continuity and responsibility for decision making.  In his view,
Ukraine's lack of experience in this type of technology--coupled with
the desire to demonstrate independence--has contributed to
difficulties with project implementation.  For example, officials at
a Ukraine design institute would not initially approve the use of a
standard U.S.  welding technique because they were unfamiliar with
the process, delaying the manufacture of part of the cask for about 5
months. 

Ukraine's nuclear regulatory body, which is responsible for approving
the project design and construction, has been slow to issue a
construction license.  Pacific Northwest National Laboratory
officials and a representative of Duke Engineering and Services noted
that the regulator has failed to respond in a timely fashion to a
safety analysis report that is needed before construction can begin. 
These officials noted, however, that the delay is somewhat
understandable because this is the first time that the regulator has
been requested to license such a system in Ukraine. 

A Duke Engineering and Services representative said that customs
problems did not delay project implementation.  The project was
already behind schedule because of problems with the Ukrainian
regulator and plant management.  However, he noted that several
contractor personnel have spent time trying to resolve the customs
issues, taking time away from other responsibilities.  For example,
some equipment including a $400,000 cask transporter, was impounded
by Ukraine customs officials.  The transporter and some ancillary
equipment were delivered to the plant in early January 1996 but was
not cleared for release to the plant until mid-April 1996. 


   FIRE SAFETY EQUIPMENT FOR
   ZAPORIZHZHYA NUCLEAR POWER
   PLANT
------------------------------------------------------- Appendix III:6

DOE is also providing fire safety equipment to the Zaporizhzhya
nuclear power plant in Ukraine.  DOE selected Zaporizhzhya--along
with Smolensk--to be a pilot plant for the program to upgrade fire
safety, expecting that this project would be implemented quickly. 
Burns and Roe is the primary U.S.  contractor for the Zaporizhzhya
project.  DOE is purchasing fire protection suits, fire hose nozzles,
smoke detectors, fire-proofing materials, fire alarms, and fire
doors, and is assisting in installing the equipment.  A key DOE
objective is to transfer technology so that Ukraine can manufacture
fire doors. 


      PROJECT COSTS
----------------------------------------------------- Appendix III:6.1

As of March 31, 1996, DOE had obligated $1.8 million and had spent
about $1.7 million for the project.  Table III.8 shows these
expenditures in greater detail. 



                              Table III.8
                
                   Expenditures for Zaporizhzhya Fire
                 Safety Equipment, as of March 31, 1996

Expenditure                                                     Amount
----------------------------------------  ----------------------------
Labor                                                          $25,682
Travel                                                           3,337
Subcontracts/materials                                       1,610,871
Other direct costs                                                   0
Overhead                                                        32,681
======================================================================
Total                                                       $1,672,571
----------------------------------------------------------------------
Sources:  Brookhaven and PNNL. 


      PROJECT STATUS
----------------------------------------------------- Appendix III:6.2

The project did not meet its initial expected completion date of
December 1994.  DOE currently estimates that the project will be
completed in December 1996.  According to Burns and Roe, the U.S. 
contractor, the delays have been caused primarily by (1) the plant
management's changes in work scope, (2) liability concerns, and (3)
the inability of the Ukrainian company responsible for manufacturing
the fire doors to meet milestones.  Originally, Burns and Roe had
planned to provide significant amounts of fireproofing materials for
the reactor's walls.  However, the plant's management subsequently
requested that the materials be used for the floors, which required
extensive reconfiguration of material requirements and rebidding of
contracts.  DOE's project manager estimated that nuclear liability
problems--and the resulting change in project management from
Brookhaven to DOE--created a delay of 1 year. 

A Burns and Roe representative said the acquisition of
Ukrainian-manufactured fire doors has delayed the project by about 7
months.  As part of its program to transfer technology to support
recipient countries' infrastructure, DOE identified a Ukrainian
company to produce fire doors for Zaporizhzhya.  This company is
expected to manufacture 122 fire doors that will be installed at one
unit of the plant.  Initial efforts to produce the doors were delayed
because prototype doors manufactured by the company failed
certifications tests.  According to the U.S.  contractor, the
Ukrainian company then took about 5 months to redesign the doors. 
The doors passed inspection in June 1995.  This company will be paid
about $70,000 to produce the doors.  At the time of our review, the
production of the doors had recently begun.  DOE estimates that all
of the doors will be installed by September 1996. 

Overall, the project now appears to be progressing more smoothly. 
According to a Burns and Roe representative, the project is
approximately 90-percent complete.  According to DOE officials, with
the exception of the Ukrainian fire doors, most of the equipment has
been delivered, including 50 fire suits, 1,242 sprinkler heads, 160
smoke detectors, and fireproof sealant material.  Other equipment,
including fire extinguishers and face masks, will be provided by
Ukrainian vendors. 

DOE and Pacific Northwest National Laboratory officials, as well as a
Burns and Roe representative, believe that the project has met most
of its safety-related objectives.  In their view, the one operating
unit at Zaporizhzhya that is receiving fire safety equipment is now
more capable of reducing the incidence of fire and has an increased
capacity to mitigate a fire's consequences.  DOE officials are
confident that the Ukrainian company will continue to manufacture
fire doors for Soviet-designed reactors, at least in the near-term. 
For example, the Ukrainian company was negotiating a contract with
the Laboratory to provide between 300 and 500 fire doors for
Chornobyl.  In addition, these officials believe that the company
will provide more doors to Zaporizhzhya over the next few years. 
They expressed some concern, however, about whether funds would be
sufficient to provide fire safety upgrades at more than one unit of
the plant. 


   EMERGENCY OPERATING
   INSTRUCTIONS FOR
   SOVIET-DESIGNED REACTORS
------------------------------------------------------- Appendix III:7

DOE is assisting plant operators in developing symptom-based
emergency operating instructions for Soviet-designed reactors.  In
the event of an emergency, symptom-based operating instructions are
designed to (1) specify operator actions in response to changing
plant conditions, (2) allow the operator to stabilize the reactor
without having to first determine the cause for the changing reactor
conditions, and (3) contribute to faster decision making.\7

DOE and national laboratory officials believe that the development
and implementation of these instructions is one of the more
significant components of the U.S.  program to provide nuclear safety
assistance.  In their view, these instructions focus on the human
element of safety and will contribute to a self-sustaining safety
culture.  DOE is also assisting in the development of operator
training for the instructions.  In addition, DOE is assisting in the
development of operational control procedures. 

The Institute of Nuclear Power Operations (INPO) has been responsible
for transferring the U.S.  methodology for developing and
implementing the symptom-based emergency operating instructions. 
INPO was established by the U.S.  nuclear industry in 1979 following
the Three Mile Island Accident.  Its purpose was to enhance the
safety and reliability of commercial nuclear power plants.  INPO has
developed a series of operational procedures and guidelines that have
been adopted by power plant operators throughout the United States
and is considered a leader in the field of operational safety in
general and in the field of symptom-based emergency operating
instructions in particular. 


--------------------
\7 There are two general types of emergency operating instructions: 
event-based and symptom-based.  Event-based instructions require the
operators to first identify the cause of the problem and then follow
the specified actions for that event.  This type of procedure was
used at U.S.  nuclear plants prior to the Three Mile Island Accident
in 1979 and is currently used at most Soviet-designed nuclear power
plants.  The symptom-based approach is currently used at all U.S. 
and many other western nuclear power plants. 


      PROJECT COSTS
----------------------------------------------------- Appendix III:7.1

Since February 1991, DOE has awarded four sole-source contracts to
INPO for $13.5 million to transfer documents and expertise to help
develop emergency operating instructions for the Newly Independent
States.\8 The contract prices were based on a fee system used for
membership in INPO.  Under the terms of these fixed-price contracts,
DOE accepted the fact that INPO's accounting system did not meet
government cost accounting standards and did not break out costs by
such categories as labor, travel, and overhead. 

In addition to the INPO contracts, DOE has spent about $1.8 million
to support the development of the instructions.  (See table III.9.)



                              Table III.9
                
                  Expenditures for the Development of
                Emergency Operating Instructions, as of
                             March 31, 1996

Expenditure                                                     Amount
----------------------------------------  ----------------------------
Labor                                                         $181,211
Travel                                                         394,454
Subcontracts/materials                                         822,464
Other indirect costs                                            49,802
Overhead                                                       389,528
======================================================================
Total                                                       $1,837,459
----------------------------------------------------------------------
Sources:  Brookhaven National Laboratory and PNNL. 

As part of its overall support for the project, DOE is providing
funds directly to several Russian nuclear power plants.  As of March
1996, the Pacific Northwest National Laboratory had awarded contracts
totaling $1.1 million to nine nuclear power plants that are
developing the instructions in Russia, Ukraine, Bulgaria, and
Lithuania.  DOE's project manager said the funds are needed to
accelerate the pace of the program. 


--------------------
\8 Of the $13.5 million contract, $6.5 million has been funded under
the 1992 Lisbon Initiative.  The balance of $7 million predates the
Initiative and was funded through other DOE programs. 


      PROJECT STATUS
----------------------------------------------------- Appendix III:7.2

The development and implementation of the emergency operating
instructions has faced considerable impediments and delays.  The
experience at the Novovoronezh nuclear power plant is a case in
point.  In 1992, DOE's former Assistant Secretary for Nuclear Energy
said in congressional testimony that by mid-1993, 35 emergency
operating instructions were to be implemented at Novovoronezh.\9 By
March 1996, only 22 of the instructions had been approved for
implementation at one of the plant's operating units.  DOE and INPO
officials noted that while the plant had drafted all of the
procedures in 1992, numerous factors had delayed approval and
implementation.  Russian organizations that are responsible for
approving the procedures have been slow to act and have not given the
project priority status. 

A Pacific Northwest National Laboratory official told us that the
Russian regulator and the VVER design institute were not included in
the early part of the project.  While this approach was dictated by
the Ministry of Energy in the former Soviet Union, it became
increasingly apparent that this approach did not ensure adequate
coordination.  A DOE official said that it was difficult to obtain a
consistent story about which Russian organization was responsible for
the delays.  In August 1995, a Rosenergoatom official told a DOE
official that the emergency operating instructions, in general, had
been "headaches and a drain on resources." In a March 1995 meeting
between DOE and Minatom officials, DOE noted that it was very
difficult to defend the U.S.  nuclear safety assistance program when
the Novovoronezh instructions were taking so long to be approved. 
DOE officials responsible for the project noted that although
coordination among the key Russian organizations has improved over
the years, it still could be better. 

DOE and Pacific Northwest National Laboratory officials noted that
Russian officials have grown more supportive of the project.  For
example, the same Rosenergoatom official who had earlier criticized
the project has made supportive statements since that time, according
to DOE.  In addition, in late September 1995, senior managers of key
Russian organizations told a DOE representative that the project was
a priority and that project management would be improved.  Although
disappointed by the pace of the instructions' development, U.S. 
officials believe that progress is being made because Russia and
Ukraine are displaying a greater commitment to implementing the
instructions.  For example, Goscomatom decreed that all reactor sites
must develop emergency operating instructions by December 1996.  In
January 1996, Rosenergoatom directed all Russian plants to implement
the instructions. 

Nevertheless, impediments remain for the project.  For example,
according to INPO, the development of the VVER instructions had
stalled because the design institute had not provided engineering
analysis.  Furthermore, the design institute was generally unwilling
to perform the analysis without compensation, which the nuclear power
plants are unable to provide without funding assistance from the
United States.  Table III.10 shows the status of the emergency
operating instructions by reactor type as of March 1996. 



                              Table III.10
                
                     Status of Emergency Operating
                     Instructions, as of March 1996

                        Novovorone
                        zh/VVER     VVER 440/
Reactor type/activity   440/230\a   213         VVER 1000   RBMK
----------------------  ----------  ----------  ----------  ----------
Percent of              100%        About 70%   100%        About 85%
instructions drafted

Planned drafting        Complete    3/1997      Complete    10/1996
completed (Month/
year)

Status of analysis by   Working on  \b          Recently    \Being
design institute        last 10                 begun       provided
                        instructio
                        ns

Status of regulatory    Partial     \c          \c          \c
approval                approval

Planned implementation  Partial     3/1998      12/1998     9/1997
date (Month/year)       approval
                        on 3/
                        1996.
                        Additional
                        10 planned
                        for 6/
                        1997
----------------------------------------------------------------------
\a Novovoronezh is the key pilot plant. 

\b The needed analysis has been identified.  However the performing
organization has not received any funds to perform the necessary
analysis. 

\c Awaiting receipt of final documents from the nuclear power plants. 

Source:  INPO and DOE. 

U.S.  officials cited a case in which operators' exposure to the
process of developing the instructions provided them with the
knowledge to respond more effectively and efficiently to emergency
conditions.  In response to leakage of cooling water from a Ukrainian
reactor, operators took specific actions to control the water leakage
and prevented the reactors from overheating. 


--------------------
\9 Safety of Soviet-Designed Nuclear Power Plants, statement before
the Senate Committee on Energy and Natural Resources (June 16, 1992),
p.  41. 


   JOINT PARALLEL NUCLEAR
   ALTERNATIVES STUDY FOR RUSSIA
------------------------------------------------------- Appendix III:8

In December 1993, the U.S.  Secretary of Energy and the Russian
Minister of Fuels and Energy agreed to conduct a joint study to
examine options for electric power in Russia, as recommended by the
Gore-Chernomyrdin Commission.\10 This study was (1) intended to build
on a 1993 study on electricity options for Russia prepared for the
G-7 by the World Bank, the International Energy Agency, and the
Russian government and (2) expected to provide a framework for
investment by international financial institutions in Russia's
electricity sector. 

U.S.-Russian working groups were established on energy efficiency,
thermal power plants, nuclear power, hydroelectric power, and a joint
steering committee with representation from the Department of State,
USAID, DOE and NRC.  Because of Minatom's initial resistance to
participating in the joint study, DOE agreed to produce a second,
parallel study that focused exclusively on the nuclear sector in
Russia.  DOE expected that its study would provide Russia with a
cost-based analysis of nuclear energy options.  The options evaluated
were (1) enhancing the safety of operating plants, (2) closure and
decommissioning of operating plants, (3) conversion of a partially
built power plant to gas or coal, (4) completing a partially built
plant, and (5) building a new generation of plants.  The conclusions
and findings of the nuclear study were integrated into the broader
study. 


--------------------
\10 The Commission was created in 1993 to overcome trade barriers in
the energy sector but has expanded into other areas, including
business development, space, and science and technology. 


      PROJECT COSTS
----------------------------------------------------- Appendix III:8.1

DOE spent about $2 million to prepare the Joint Parallel Nuclear
Alternatives Study for Russia.  The study was funded under DOE's
international nuclear safety program.  (See table III.11 for greater
detail.) The broader study, the Joint Electric Power Alternatives
Study, prepared by USAID and its contractors, cost about $8 million. 



                              Table III.11
                
                  Expenditures for the Joint Parallel
                 Nuclear Alternatives Study for Russia,
                          as of March 31, 1996

Expenditure                                                     Amount
----------------------------------------  ----------------------------
Labor                                                         $143,953
Travel                                                         148,373
Subcontracts/materials                                       1,308,394
Overhead                                                       409,525
======================================================================
Total                                                       $2,010,245
----------------------------------------------------------------------
Source:  Brookhaven National Laboratory. 


      PROJECT STATUS
----------------------------------------------------- Appendix III:8.2

DOE's nuclear study was completed in May 1995 and the broader
electric power study was presented at a meeting of the
Gore-Chernomyrdin Commission in June 1995.  Both studies were
intended to be completed on a fast track in order to be available for
the July 1994 G-7 meeting, but completion of the studies was delayed
for about 1 year.  This delay increased DOE's project costs by about
$1 million.  Department of State and Brookhaven officials told us
that project delays were due to Russian difficulties in developing
the data and models, and disagreements over cost assumptions.  In
addition, a large number of Russian energy ministries, institutes,
and organizations jointly prepared the report with the United States,
and it took more time than anticipated to get their agreement on the
report. 

Although there were initial difficulties in gaining the cooperation
of Minatom, a Department of State official believes that one of the
long-term benefits of the DOE-funded study is that Minatom worked
cooperatively with other Russian energy ministries and organizations. 
The study found that nuclear power was cost- competitive with other
sources of electricity in Russia and concluded that it was in
Russia's economic interest to upgrade some plants and to close four
to six of its older plants.  The study also recommended that Russia
develop a decommissioning program for a specific RBMK type of
reactor.  DOE and Brookhaven are now working with Minatom, the
Kurchatov Institute in Moscow, and the Leningrad nuclear power plant
in Russia to initiate a decommissioning study for Unit 1 of the
plant. 


NUCLEAR REGULATORY COMMISSION
SAFETY ASSISTANCE PROJECTS
========================================================== Appendix IV

This appendix discusses four nuclear safety projects that NRC is
implementing in Russia and Ukraine.  These projects, with a total
value of about $10.5 million, focus on (1) providing analytical
simulators for Russia and Ukraine, (2) developing an emergency
response center in Russia, (3) helping develop legal authority for
Russia's nuclear regulatory body, and (4) supporting efforts to
perform a probalistic risk assessment at a Russian nuclear power
plant. 


   ANALYTICAL SIMULATORS FOR
   RUSSIA AND UKRAINE
-------------------------------------------------------- Appendix IV:1

NRC plans to provide four analytical simulators for the nuclear
regulatory bodies in Russia and Ukraine to use for training
purposes.\1

Simulators are planned for Ukraine's regulatory center in Kiev and
Russian regional and headquarters' sites.  The regulators will
receive software needed to model VVER-1000 plants at Zaporizhzhya in
Ukraine and Balakovo in Russia, a VVER-440/213 plant at Rivne in
Ukraine, and an RBMK plant at Kursk in Russia.  In addition, the
regulators will be trained to perform software modifications so that
nuclear power plants at Chornobyl and Kola can also be simulated. 

The analytical simulators will enable the regulators to familiarize
themselves with plant operations.  NRC believes that the regulators'
ability to monitor plant safety will be improved significantly by
providing dedicated training simulators.  Currently, only a handful
of regulators obtain a few hours of training on existing plant
simulators in Russia and Ukraine.  When fully implemented, the
regulators are expected to have an integrated system of computer
hardware and software and to train designated personnel in the use
and maintenance of the analytical simulators. 


--------------------
\1 NRC has five full-scope simulators at a training center in
Chattanooga, Tennessee.  Analytical simulators run the same software
as the full-scope simulators, but control room and panels are not
provided.  The simulation is displayed on computer monitors. 


      PROJECT COSTS
------------------------------------------------------ Appendix IV:1.1

NRC has allocated about $1.5 million for Russia and $2 million for
Ukraine.  As of March 31, 1996, NRC had obligated and expended
$12,839 of this amount on personnel travel but had not yet spent any
of its funds for Ukraine.  Equipment and other deliverables have not
yet been provided to Russia and Ukraine because of procurement
problems at NRC.  Table IV.1 shows the expenditures for this project
in greater detail. 



                               Table IV.1
                
                Expenditures for Analytical Simulators,
                          as of March 31, 1996

Expenditure                                                     Amount
----------------------------------------  ----------------------------
Contractor personnel                                                $0
Travel                                                          12,839
Training                                                             0
Equipment                                                            0
======================================================================
Total                                                          $12,839
----------------------------------------------------------------------
Source:  NRC. 


      PROJECT STATUS
------------------------------------------------------ Appendix IV:1.2

The analytical simulator project was originally planned for
completion by December 1996.  NRC now projects that it will be
completed about mid-1999.  Project implementation has been slow
primarily because of procurement delays.  NRC has twice requested
proposals for the analytical simulators in an attempt to obtain what
it views as a reasonable price for the work envisioned.  In May 1995,
NRC requested proposals for simulators to be supplied to Russia.  NRC
considered the one proposal it received to be unreasonably high when
compared with the government's estimate of about $3 million.  In
December 1995, NRC solicited a proposal for both Russia and Ukraine
and awarded a contract in June 1996 for $2.6 million. 

NRC plans to complete the project in several phases.  The first
phase, which started in December 1993 and is to be completed around
December 1997, involves training personnel and delivery of simulator
hardware to Russia and Ukraine.  The second phase, which is projected
to start in January 1997 and end in August 1998, involves the
delivery of additional hardware to Russia.  The third phase, which
NRC plans to begin in September 1997 and complete by mid-1999,
focuses on additional training and improved capabilities for the
simulators. 


   EMERGENCY INCIDENT RESPONSE
   SUPPORT CENTER IN RUSSIA
-------------------------------------------------------- Appendix IV:2

NRC is assisting Russia's regulatory organization, Gosatomnadzor
(GAN), in establishing a basic communications system and essential
support capabilities for responding to emergencies at nuclear power
plants.\2

NRC's effort is intended to reduce the severity of an emergency,
should one occur, by reducing the incidence of radiological exposure
to the public and the environment.  The project provides for the
purchase, installation, and in-place testing of prototype equipment
at three locations--GAN Headquarters in Moscow, the Leningrad nuclear
power plant near St.  Petersburg, and the Kalinin nuclear power plant
located between these two cities.  After the prototype phase is
completed, NRC plans to provide equipment to 11 other nuclear power
plants and regional regulatory offices in Russia.  Figure IV.1 shows
the emergency response center in Moscow. 

   Figure IV.1:  Emergency
   Incident Response Center at GAN
   Headquarters, Moscow, Russia

   (See figure in printed
   edition.)

   Source:  Science Applications
   International Corporation.

   (See figure in printed
   edition.)

NRC plans to complete a fully functional emergency support center in
Moscow with communication links to each Russian nuclear power plant. 
NRC is taking a phased approach because of, among other things,
operating uncertainties in Russia.  NRC has contracted with Science
Applications International Corporation (SAIC) for almost all of the
work on the project, in accordance with plans approved by both NRC
and GAN.  NRC expects that a minimum amount of assembled equipment
will be tested and operated in Russia during the prototype phase. 
The purpose is to determine if the equipment is fully suitable before
making a U.S.  investment in the entire Russian response system. 

NRC officials believe that once the transmission links are fully
functional, the project will begin to show tangible, measurable
progress.  By improving communications among the plants and GAN, NRC
believe the regulatory body's role will be enhanced significantly
because it will play a major role in coordinating activities in case
of a nuclear power plant emergency. 


--------------------
\2 The Russian system is essentially modeled on the U.S.  emergency
response approach.  The U.S.  system is a "real-time" program to
provide direct transmission of selected nuclear power plant
information from the licensee's on-site computers to NRC's Operations
Center in Rockville, Maryland.  The Operations Center coordinates and
disseminates information about the emergency to various U.S.  and
international organizations. 


      PROJECT COSTS
------------------------------------------------------ Appendix IV:2.1

NRC has budgeted $1.5 million for the project.  As of March 31, 1996,
NRC had obligated about $1.3 million and had spent $524,738 for the
project.  Table IV.2 shows how the funds have been spent. 



                               Table IV.2
                
                  Expenditures for Emergency Incident
                 Response Center, as of March 31, 1996

Expenditure                                                     Amount
----------------------------------------  ----------------------------
Contractor Personnel                                          $313,521
Travel                                                          60,857
Training                                                             0
Equipment                                                      150,360
======================================================================
Total                                                         $524,738
----------------------------------------------------------------------
Source:  NRC. 


      PROJECT STATUS
------------------------------------------------------ Appendix IV:2.2

The project, started in October 1992, was originally expected to be
completed by February 1996 but is now projected to be completed by
September 1997.  NRC has provided some prototype equipment but has
not yet expanded the project to provide basic communications and
support equipment to all of the Russian nuclear power plants and to
GAN headquarters.  The prototype equipment associated with the
project includes three compatible computers with fax modems and
software, a dot-matrix printer, a facsimile machine, and three
high-frequency radio base stations with fax modems. 

NRC officials and SAIC representatives said the prototype
communications system, which is partially functioning, faced several
impediments that delayed operations.  For example, permits obtained
from Russia's Ministry of Communications to test radio communications
were temporary and good for initial tests only.  Under the prototype
phase, the initial results from testing were poor but because the
temporary permits had expired, further testing had to await better,
permanent frequency assignments and permits by the Ministry.  NRC
finished the prototype work in the spring of 1996, and not by January
1995, as originally estimated. 

In addition, project-related equipment has not always been delivered
in a timely manner because of customs problems.  For example, three
antennas costing about $2,000 were held by Russian customs for
several weeks in mid-1995.  The U.S.  contractor had shipped the
antennas, but they were impounded by customs officials, who demanded
payment of import duties to release them.  NRC brought this matter to
the attention of a GAN official to get the equipment released.  In
another case, 10 modems and related cables that GAN officials had
hand-carried to Russia were impounded by customs officials.  As a
result of that customs action, other shipments were halted and the
installation of the equipment was put on hold.  The matter was
resolved in September 1995, but a SAIC representative told us that he
has spent large amounts of time assisting GAN with customs problems. 


   NUCLEAR LEGISLATION AND
   LICENSING INITIATIVES IN RUSSIA
-------------------------------------------------------- Appendix IV:3

NRC is helping GAN to (1) develop a legal framework and create a
system of enforcement and economic sanctions and (2) improve its
ability to license civilian nuclear power plants and other civilian
nuclear installations.  NRC and GAN consider these objectives to be
among the highest priority.  Without a legal foundation for its
operations--and the ability to impose fines for improper
operations--GAN's long-term effectiveness and viability remain
questionable.  GAN's First Deputy Chairman told us that without the
appropriate legislative backing, his organization will not be able to
function effectively within the Russian nuclear bureaucracy.  For
example, the Russian official noted that although GAN can impose
fines on nuclear installations, the fines are of little value. 

In the fall of 1994, NRC officials provided comments to GAN on the
draft Russian law pertaining to the use of nuclear energy.  The
comments primarily related to the need to clarify GAN's regulatory
independence.  According to NRC officials, NRC is not attempting to
impose its own regulatory system on GAN.  Rather, it seeks to work
collaboratively and tailor its support to meet the needs of GAN.  As
a result, GAN has acquired detailed information about NRC regulatory
practices and legal responsibilities through this project. 


      PROJECT COSTS
------------------------------------------------------ Appendix IV:3.1

NRC had allocated $577,934 for the project as follows:  $502,934 for
licensing activities and $75,000 for legislative and enforcement
initiatives.  As of March 31, 1996, NRC had obligated $479,773 and
had expended $328,638 for licensing activities, and had obligated and
spent $39,010 for legislative initiatives.  Table IV.3 shows these
expenditures in greater detail. 



                               Table IV.3
                
                     Expenditures for Licensing and
                Legislative Initiatives, as of March 31,
                                  1996

Expenditure                                                     Amount
----------------------------------------  ----------------------------
Licensing activities
Contractor personnel                                          $152,309
Travel                                                         176,329
Training                                                             0
Equipment                                                            0
======================================================================
Subtotal                                                      $328,638
Legislative initiatives
Contractor personnel                                                $0
Travel                                                          39,010
Training                                                             0
Equipment                                                            0
======================================================================
Subtotal                                                       $39,010
======================================================================
Total                                                         $367,648
----------------------------------------------------------------------
Source:  NRC. 


      PROJECT STATUS
------------------------------------------------------ Appendix IV:3.2

Both the legislative and licensing initiatives have been delayed. 
The licensing project was originally scheduled to be completed in
mid-1995 and is now scheduled for completion in mid-1997.  The
legislative initiative, which began in May 1994, was originally
expected to be completed by December 1995.  NRC now anticipates that
the initiative will conclude by December 1996.  NRC officials cited a
number of factors that have contributed to schedule slippages,
including (1) changes in the scope of the project, (2)
longer-than-anticipated time to prepare and translate critical
documents, and (3) delays in Russian completion of legislation and
drafting of an enforcement policy.  NRC officials emphasized that the
completion of the project depends to a great degree on the maturation
of GAN and its acceptance within the Russian bureaucracy. 

Despite these delays, NRC officials view the progress made under
these initiatives as an important first step toward increased
regulatory independence and effectiveness.  In November 1995, Russian
President Yeltsin signed legislation that established, in part, a
legal framework for the regulation of nuclear safety.\3 NRC assisted
GAN in drafting this legislation.  Both NRC and GAN officials noted
that the law is a significant step toward "legitimizing" GAN.  GAN
has also been designated as the lead agency to develop a supplemental
law about the roles and responsibilities of the regulatory
organization in Russia.  NRC officials also believe that the
licensing initiative is now moving ahead.  For example, GAN submitted
a document to NRC that addresses the process for submitting and
approving licenses for various nuclear installations. 


--------------------
\3 The law entitled "Russian Federation Law on the Use of Atomic
Energy" was passed by the Russian Parliament in Oct.  1995. 


   PROBALISTIC RISK ASSESSMENT FOR
   KALININ NUCLEAR POWER PLANT
-------------------------------------------------------- Appendix IV:4

NRC is supporting Russia's efforts to involve six Russian
organizations, including GAN, to perform a Probalistic Risk
Assessment for a VVER-1000 reactor at unit 1 of the Kalinin nuclear
power plant.  A Probalistic Risk Assessment is used to evaluate the
potential for significant accidents occurring at a plant during
different power operations.  NRC has entered into agreements with six
Russian organizations, including the plant designer, plant operator,
the utility, and the regulator, to facilitate the assessment.  GAN is
responsible for coordinating and managing the project with the
various Russian organizations participating in the development of the
risk assessment. 

NRC believes that by performing the risk assessment, GAN and the
other Russian participants will (1) obtain Probalistic Risk
Assessment training and develop expertise to perform and/or evaluate
risk assessments conducted for other nuclear power plants, (2)
achieve an improved understanding of the value of risk assessments
and their uses for improving safety, and (3) increase its stature. 
Additionally, NRC anticipates that as the Russian organizations
collaborate on the project, they will become more open and willing to
cooperate among themselves in conducting risk assessments on other
plants in Russia. 


      PROJECT COSTS
------------------------------------------------------ Appendix IV:4.1

NRC plans to spend $2.5 million for the project.  As of March 31,
1996, NRC had obligated $1.4 million and had spent about $1.1
million.  Table IV.4 provides detailed information on these
expenditures. 



                               Table IV.4
                
                   Expenditures for Probalistic Risk
                  Assessment for Kalinin Nuclear Power
                      Plant, as of March 31, 1996

Expenditure                                                     Amount
----------------------------------------  ----------------------------
Contractor personnel                                          $974,635
Travel                                                          89,437
Training                                                             0
Equipment                                                            0
======================================================================
Total                                                       $1,064,072
----------------------------------------------------------------------
Source:  NRC. 


      PROJECT STATUS
------------------------------------------------------ Appendix IV:4.2

The project began in mid-1994 but initially experienced difficulty
getting under way.  According to NRC officials, a number of factors
contributed to delays.  NRC had some difficulty obtaining agreement
among the various Russian participants about their respective roles,
responsibilities, and the extent to which a final report would be
distributed to other VVER-1000 plants.  NRC and GAN signed a
memorandum of understanding for the project in December 1994, but the
final implementing agreements for all the other Russian participants
were not approved until August 1995.  Development of the project
guidelines was also delayed. 

To date, the project has focused primarily on defining the scope of
the project, developing specific procedure guides for each project
task, and formalizing the amount and type of training needed.  In
March 1996, NRC held a 2-month risk assessment workshop at which
Russian technical staff representing the participating organizations
met with NRC and U.S.  experts.  The purpose of the workshop was to
begin the practical integration of the organizations and to focus on
specific probalistic risk assessment tasks.  NRC is attempting to
structure the training so that the Russian organizations will be able
to perform the probalistic risk assessments on their own with
periodic NRC assistance and oversight.  As part of this process, the
Kalinin nuclear power plant staff is expected to provide specific
information on plant design, operating history, and operating
procedures. 


SCOPE AND METHODOLOGY
=========================================================== Appendix V

To identify the goals and objectives of the U.S.  nuclear safety
assistance program, we interviewed and obtained pertinent documents
from officials at the Department of State, USAID, DOE, and NRC.  We
also met with officials at the Brookhaven National Laboratory in
Upton, New York, and at the Pacific Northwest National Laboratory in
Richland, Washington.  We also met with representatives of the
Nuclear Energy Institute and the Natural Resources Defense Council in
Washington, D.C., to obtain their views about the priorities,
objectives, and implementation of the U.S.  program. 

To provide information on the amount and type of U.S.  assistance
being planned or provided, we obtained cost and program funding data
from U.S.  government agencies that provided the assistance. 
Specifically, we obtained these data from DOE, the Brookhaven and
Pacific Northwest National Laboratories, and NRC.  We did not
independently verify the accuracy of the data they provided. 

To determine how the U.S.  safety assistance program was being
implemented, we judgmentally selected 13 DOE and NRC safety projects
to review.  These projects are valued at about $67 million.  We
limited our selection of projects to Russia and Ukraine because those
countries are the primary recipients of U.S.  assistance to improve
the safety of Soviet-designed reactors.  We based our selection on a
number of factors:  (1) the maturity of the project; (2) dollar
value; and (3) diversity--equipment-related projects,
training-related projects, legislative initiatives, and a study of
nuclear energy options for Russia.  We discussed our selection of
projects with DOE and NRC officials.  DOE officials requested that we
add some additional training and equipment projects to our sample,
which we did.  NRC officials said the projects we chose represented a
fair sample of the type of assistance NRC is providing. 

To assess the status of the selected projects and how they are
improving safety, we met with appropriate DOE, NRC, and national
laboratory officials.  We also met with U.S.  contractor
representatives responsible for implementing the projects for DOE and
NRC.  Specifically, we met with officials from the following U.S. 
firms:  Burns and Roe Company (Oradell, New Jersey); Science
Applications International Corporation (Germantown, Maryland); S-3
Technologies, Inc.  (Columbia, Maryland); Duke Engineering and
Services (Charlotte, North Carolina); Sonalysts, Inc.  (Waterford,
Connecticut); and Bechtel Power Corporation (Gaithersburg, Maryland). 
We also met with a representative of the Institute of Nuclear Power
Operations (Atlanta, Georgia). 

We met with officials from Russia and Ukraine to obtain their views
on U.S.  nuclear safety assistance.  Specifically, we met with
Russian representatives from the Smolensk nuclear power plant and
Russia's Ministry of Atomic Energy, Minatom.  We also observed a
week-long safety assistance planning meeting between NRC and GAN
officials.  We met with several GAN officials, including the First
Deputy Chairman, to discuss their views about the U.S.  assistance
program.  We discussed the implementation of the Khmelnytskyy
simulator project with several Ukrainian representatives from the
plant and from Ukraine's nuclear utility, Goscomatom.  These
representatives were part of the technology transfer team temporarily
residing in the United States. 




(See figure in printed edition.)Appendix VI
COMMENTS FROM THE DEPARTMENT OF
ENERGY
=========================================================== Appendix V



(See figure in printed edition.)


The following are GAO's comments on DOE's letter dated September 17,
1996. 


   GAO'S COMMENTS
--------------------------------------------------------- Appendix V:1

1.  DOE disagreed with our position that the U.S.  safety assistance
program poses a dilemma because it may encourage the continued
operation of the same reactors that the United States wants to see
closed as soon as possible.  DOE said that the equipment it is
providing is targeted to specific safety deficiencies or to prevent
the failure of critical safety equipment and does not extend the
operating life of the Soviet-designed nuclear power plants.  We have
not asserted that the equipment will extend the life of the
Soviet-designed plants but believe that some of this equipment may be
used to justify the continued operation of the plants.  As we noted
in the report, the repair or replacement of any component that the
plant relies on would support continued plant operations.  In our
view, DOE's RBMK maintenance initiative provides the equipment,
training, and transfer of technology that enables plant components to
remain in service longer--thereby supporting continued plant
operations while improving plant safety. 

For this reason, we maintain that the U.S.  program poses a dilemma
for U.S.  policymakers.  While the United States remains committed to
the goal of shutting down the highest-risk plants, the assistance has
the potential to keep the plants operating longer than they otherwise
might have. 




(See figure in printed edition.)Appendix VII
COMMENTS FROM USAID
=========================================================== Appendix V



(See figure in printed edition.)



   GAO'S COMMENTS
--------------------------------------------------------- Appendix V:2

The following are GAO's comments on USAID's letter dated September
18, 1996. 

1.  Regarding USAID's comment that progress has been made in the U.S. 
assistance program, our report noted that several projects we
reviewed are progressing and have, for example, resulted in
installing fire safety equipment and other safety-related hardware. 
However, it is too early to assess the progress these projects have
made in safety because only one of the projects we reviewed had been
completed.  Furthermore, most of the 13 projects we reviewed had been
delayed, and progress was slow in many cases. 

2.  USAID commented that the report gives the impression that no
progress is being made toward obtaining the closure of the
highest-risk Soviet-designed reactors.  Our report cites several
instances in which closure commitments have been made but also notes
that it will be difficult for the countries to meet specific closure
dates because of the slow pace of economic reform and the need for
financing to help develop alternative energy sources.  We also note,
however, that to date no reactors have been closed, and one was
recently restarted. 


MAJOR CONTRIBUTORS TO THIS REPORT
======================================================== Appendix VIII

RESOURCES, COMMUNITY, AND ECONOMIC
DEVELOPMENT DIVISION, WASHINGTON,
D.C. 

Bernice Steinhardt, Associate Director, Energy, Resources, and
Science Issues
Gene Aloise, Assistant Director
Glen Levis, Evalutor-in-Charge
Sarah E.  Veale, Senior Evaluator
Philip A.  Olson, Senior Evaluator
Duane G.  Fitzgerald, Ph.D., Nuclear Engineer

OFFICE OF GENERAL COUNSEL

Jackie A.  Goff, Senior Attorney


*** End of document. ***