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America’s new nuclear power industry has a Russian problem

Kitco News Reuters  Friday October 21, 2022,

WASHINGTON/LONDON, Oct 20 (Reuters) – U.S. firms developing a new generation of small nuclear power plants to help cut carbon emissions have a big problem: only one company sells the fuel they need, and it’s Russian.

That’s why the U.S. government is urgently looking to use some of its stockpile of weapons-grade uranium to help fuel the new advanced reactors and kick-start an industry it sees as crucial for countries to meet global net-zero emissions goals.

Production of HALEU is a critical mission and all efforts to increase its production are being evaluated,” a spokesperson for the U.S. Department of Energy (DOE) said……..

without a reliable source of the high assay low enriched uranium (HALEU) the reactors need, developers worry they won’t receive orders for their plants. And without orders, potential producers of the fuel are unlikely to get commercial supply chains up and running to replace the Russian uranium……

The fact that Russia has a monopoly on HALEU has long been a concern for Washington but the war in Ukraine has changed the game, as neither the government nor the companies developing the new advanced reactors want to rely on Moscow.

HALEU is enriched to levels of up to 20%, rather than around 5% for the uranium that powers most nuclear plants. But only TENEX, which is part of Russian state-owned nuclear energy company Rosatom, sells HALEU commercially at the moment.

While no Western countries have sanctioned Rosatom over Ukraine, mainly because of its importance to the global nuclear industry, U.S. power plant developers such as X-energy and TerraPower don’t want to be dependent on a Russian supply chain.

“We didn’t have a fuel problem until a few months ago,” said Jeff Navin, director of external affairs at TerraPower, whose chairman is billionaire Bill Gates. “After the invasion of Ukraine, we were not comfortable doing business with Russia.”

………….. with large-scale projects still challenging for reasons including huge up-front costs, project delays, cost overruns and competition from cheaper energy sources such as wind, several developers have proposed so-called small modular reactors (SMR).

While the SMRs on offer from companies such as EDF (EDF.PA) and Rolls-Royce (RR.L) use existing technology and the same fuel as traditional reactors, nine out of 10 of the advanced reactors funded by Washington are designed to use HALEU…….

Companies in the United States and Europe have plans to produce HALEU on a commercial scale but even in the most optimistic scenarios, they say it would take at least five years from the point they decide to proceed……
“Nobody wants to order 10 reactors without a fuel source, and nobody wants to invest in a fuel source without 10 reactor orders,” said Daniel Poneman, chief executive of U.S. nuclear fuel supplier Centrus Energy Corp (LEU.A)…..

TerraPower, for example, said it will need 15 tonnes of HALEU for the first fuel load of its advanced reactor.

Other potential HALEU producers are further behind.

French state-owned uranium mining and enrichment company Orano says it could start producing HALEU in five to eight years, but will only apply for a production licence once it has customers with long-term contracts.

In a response to a DOE request for information about how to establish a programme to support HALEU production, Orano said it would be down to the U.S. government to kick-start the industry.

“Orano’s assessment shows that the single most important factor enabling success is the DOE guaranteeing a certain volume of demand,” the company said in a statement on its website.

European uranium enrichment company Urenco, meanwhile, says it is considering sites in the United States and Britain for HALEU production but has yet to apply for licences.


For TerraPower and X-energy, which have projects planned in the U.S. states of Wyoming and Washington respectively, the clock is ticking.

Washington awarded them contracts to build two demonstration rectors by 2028 and shared the costs. But without Russian fuel, that deadline will fall well before any alternative commercial suppliers would be up and running.

While the 20% enrichment levels for HALEU are well below the roughly 90% level needed for weapons, companies need special licences to produce it. Additional security and certification requirements are also required for production sites, packaging and transportation of the fuel.

To speed up the process and break the deadlock, the U.S. government is looking to “downblend” weapons-grade highly enriched uranium sitting in its stockpile, though that will also take time…..

The Inflation Reduction Act U.S. President Joe Biden signed in August contained $700 million to secure HALEU supplies from the government and a consortium partnered with the DOE for use in advanced reactors and research.

In September, the White House asked Congress for another $1.5 billion in a temporary government funding bill to boost domestic supply of low enriched uranium and HALEU, to address potential difficulties in accessing Russian fuel.

Lawmakers took the measure out of the bill over concerns about costs, though it remains a priority for some Biden officials, including Energy Secretary Jennifer Granholm.

Last year, nuclear power stations in the United States imported about 14% of their uranium from Russia, along with 28% of their enrichment services, according to the U.S. Energy Information Administration.

Reporting by Sarah McFarlane and Susanna Twidale in London and Timothy Gardner in Washington; Editing by Veronica Brown and David Clarke


October 21, 2022 - Posted by | business and costs, Uranium

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