Privatization

Abstract

Following a thorough analysis of the components of the Tank Waste Remediation System (TWRS), the U.S. Department of Energy (DOE) decided that application of privatization techniques could save the Department money, improve the efficiency of its operations, balance, departmental budgets, and control cost growth. The TWRS glassification (vitrification) plants were proposed as potential privatization candidates. This article focuses on how different decision tools affected the development of the TWRS privatization project and how these tools provided decision-makers with the information required to negotiate and renegotiate the Contract and to decide whether the privatization project should continue or move to an alternative path (a nonprivatization contracting approach). In this case, the tools helped DOE with its decision to terminate the contract. While developed and perfected on TWRS privatization, these tools are applicable to other privatized business ventures requiring project finance.