Nuclear Security & Deterrence Monitor Vol. 27 No. 19
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Morning Briefing

Article of 8

March 17, 2014

USEC FUNDING TRANSFER MOVES FORWARD IN THE SENATE

By ExchangeMonitor

USEC moved one small step closer yesterday to obtaining federal funding for its American Centrifuge Project, with the Senate approving by a voice vote an amendment to the transportation bill making its way through that chamber that would give the Department of Energy the authority to transfer up to $150 million to USEC for the project this fiscal year. In exchange, USEC would have to reach an agreement with DOE that would allow the Department to have “a royalty-free, non-exclusive license” to USEC’s intellectual property and technical data for the American Centrifuge project. The agreement would allow DOE to provide such materials to a third party for “completing or operating enrichment technologies and using them for national defense purposes, such as providing nuclear material to operate commercial nuclear power reactors for tritium production,” according to a copy of the amendment. USEC would also have to sign on to an agreement that would require “the achievement of specific technical criteria” by June 30, 2014. If those criteria were not met, USEC would have to surrender to DOE any leased property, which would likely entail the remaining facilities at the Portsmouth Gaseous Diffusion Plant where the American Centrifuge Project is being conducted. More details will likely come this morning as USEC holds its quarterly earns call with investors at 8:30 am. Listen in on the call here.

Last fall, DOE asked Congress to grant transfer authority for $150 million in existing Department funds to finance the first year of a proposed two-year program that would demonstrate the American Centrifuge Project on a commercial scale after concerns about its viability that have held up a long-sought DOE loan guarantee for the project. The $150 million would come on top of the $44 million USEC has been able to realize after DOE assumed liability for a portion of USEC’s inventory of depleted uranium. That $44 million, however, is set to run out by the end of this month. In addition, DOE has requested an additional $150 million in the Fiscal Year 2013 budget request for the National Nuclear Security Administration’s Defense Nuclear Nonproliferation account.

In a statement yesterday, Ohio Senator Sherrod Brown (D), whose state is home to the American Centrifuge Project, praised the amendment. “The ACP isn’t just an important job creator in southern Ohio, it’s also a critical component of our national security,” Brown said. “That’s why we see bipartisan support in the Senate for continued research and development. The ACP is too important to terminate. I will continue working to keep these jobs in Piketon and to ensure that our nation is secure.” Clint Williamson, vice president for government affairs at enrichment competitor LES, was markedly less pleased with the amendment and emphasized his company’s different approach. “Over the last two weeks we received authorization from the U.S. government to bring 6 additional cascades of enrichment capacity online in New Mexico, that’s thousands of centrifuges operating without a dime of corporate welfare from the U.S. taxpayer,” Williamson said.

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