Office of Project Management (PM) Independent Cost Estimate (ICE) and Independent Cost Review (ICR) Standard Operating Procedure (SOP), Revision 5 - Dated May 2022

This Standard Operating Procedure (SOP) provides guidance for the DOE Office of Project Management (PM) staff and contractors performing either an Independent Cost Review (ICR) or an Independent Cost Estimate (ICE) for a capital asset project. The approval process for DOE capital asset projects includes five approval steps, each of which is referred to as a Critical Decision (CD). Each CD is approved by the appropriate Project Management Executive (PME) for a particular project. For all Major System Projects, the Deputy Secretary, as the Chief Executive for Project Management (CE), is the approval authority. The CD steps are:

• CD-0, Approve Mission Need. There is a need that cannot be met through other than material means.
• CD-1, Approve Alternative Selection and Cost Range. The selected alternative and approach are the optimum solution to satisfy the mission need.
• CD-2, Approve Performance Baseline. Definitive scope, schedule and cost baselines have been developed.
• CD-3, Approve Start of Construction/Execution. The project is ready for construction.
• CD-4, Approve Start of Operations or Project Completion. The project is ready for turnover or transition to operations, as applicable.

The combined federal/contractor Integrated Project Team (IPT) is required to develop a cost estimate for each critical decision except CD-4, at which point a summary of estimated actual costs must be provided. In addition to the cost estimate developed by the IPT, a second estimate is also required for certain Critical Decisions for projects with a TPC over $100M. The DOE PM performs the following cost evaluations per the requirements in the DOE O 413.3B, Program and Project Management for the Acquisition of Capital Assets.

• Either an ICE or an ICR prior to CD-1 (or a CD-1 Reaffirmation) approval for all projects with a total project cost (TPC) over $100M.
• An ICR prior to CD-0 for all Major System Projects, and for any other projects as designated by the CE/PME.
• An External Independent Review (EIR) (with a standalone or embedded ICR), or an ICE (if appropriate) for new scope or significant factors as defined in a Baseline Change Proposal (BCP), or major cost overruns requiring a re-baseline for a project over $100M.

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