U.S. Ramps Up Efforts to Reduce Russia HALEU Dependency

The U.S. government is ramping up efforts to supply high assay low-enriched uranium (HALEU) to domestic firms that develop a new generation of small nuclear power plants to help cut carbon emissions. Currently, Russia’s state owned Rosatom is the only company that sells the fuel. In order to reduce dependence on Russian HALEU supplies, the U.S. government is looking to use some of its stockpiles of weapons-grade uranium to help the new advanced reactors, which it sees as a crucial industry to meet its net-zero emission targets. “Production of HALEU is a critical mission and all efforts to increase its production are being evaluated,” the U.S. Department of Energy (DOE) said.

The global energy crisis caused by Russia’s invasion of Ukraine has rekindled interest in nuclear power. Supporters of new generation small nuclear reactors say they are more efficient, quicker to build and could help a great amount to energy transition efforts.

However, without a steady supply of HALEU, nuclear developers worry they won’t receive enough 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 DOE said it was aware of the need for urgent action to incentivize the supply of the fuel. The U.S. government is in the final stages of evaluating how much of its inventory of 585.6 tonnes of highly enriched uranium to allocate to reactors.

Although Russia’s monopoly over HALEU has long been a concern for Washington, Moscow’s invasion of Ukraine has accelerated efforts to wean off Russian supplies. Neither the government, nor the industry wants to rely on Moscow for fuel supplies.

HALEU is enriched to levels of up to 20%, rather than around 5% for the uranium that powers most nuclear plants. But only TENEX, a subsidiary of Rosatom, sells HALEU commercially at the moment.

While Rosatom has not been targeted by Western sanctions because of its importance in global nuclear industry, U.S. power plant developers such as X-energy and TerraPower don’t want to rely on Russian supplies.

Nuclear power currently generates about 10% of the world’s electricity and many countries are exploring new nuclear projects to improve their energy supply and energy security, as well as to help meet goals for cutting greenhouse gas emissions.

Large-scale reactors are still challenging to build. They have large up-front costs, and sometimes see project delays and cost overruns. But developers have started promoting the so-called “small modular reactors” (SMRs).

While the SMRs on offer from companies such as EDF and Rolls-Royce 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.

Supporters say HALEU plants need less frequent refueling and are three times more efficient as traditional plants. While some analysts believe they will take over conventional nuclear technology, they are yet to be tested at a commercial scale.

The average levelized cost of electricity for these plants (the price needed for advanced projects to break even) is $60 per megawatt-hour compared with $97 for conventional plants.

Some analysts say the price difference might be narrower at the moment, because the smaller advanced reactors using HALEU don’t yet have economies of scale from mass production.

Both the U.S. and Europe are planning to boost production of HALEU. But even the most optimistic scenarios suggest that producing the fuel at a commercial scale would take at least five years.

This situation creates a dilemma for the nuclear industry. Nobody wants to order reactors without a fuel source, and nobody wants to invest in a fuel source without reactor orders.

Fuel supplies have become a cause for concern for firms that are interested in new advanced reactors.

The U.S. government have been concerned for years that Russia’s monopoly on HALEU could hamper the development of the advanced reactors it hopes will provide low-carbon energy at home and also be exported to markets in Europe and Asia.

The government awarded a shared-cost contract in 2019 to Centrus, the only company outside Russia which currently has a license to make HALEU, to build a demonstration facility.

The Centrus facility was planned to start production this year but it had to push it back to 2023, partly because of delays in getting hold of storage containers due to supply chain issues during the COVID-19 pandemic.

Once the site comes online, it will take five years for it to start producing 13 tonnes per year of the fuel. Still, that’s only a third of the amount the DOE projects will be needed for U.S. reactors by 2030.

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 license once it has customers with long-term contracts.

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 licenses.

For TerraPower and X-energy, which have projects planned in the U.S. states of Wyoming and Washington respectively, not much time is left. Washington awarded them contracts to build two demonstration projects by 2028 and shared the costs. But that deadline currently seems impossible to achieve without Russian supplies.

While the 20% enrichment levels for HALEU are well below the roughly 90% level needed for weapons, companies need special licenses 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 (IRA) Biden signed into law 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.

Last year, nuclear power stations in the United States imported about 14% of their uranium from Russia, along with 28% of their enrichment services.

Need to access the insight?

Start your 7-day free trial now

Need to access the insight?

Start your 7-day free trial now

Need to access the insight?

Start your 7-day free trial now


Do you need to access special insights on this matter?

Start your 7-day free trial  and become a member today


Subscribe to Top Insights Today

Subscribe to Executive Newsletter Top Insights Today

The Executive Newsletter -Top Insights Today- puts global business events in perspective through special insights

Join the ranks of global executives and subscribe to Top Insights Today

Top Insights Today covers insights on energy, clean-tech, oil&gas, mining, rare earths, defense, aviation, infrastructure, manufacturing, electrical vehicles, big-tech, finance and politics of business

By clicking subscribe you agree to our privacy and cookie policy and terms and conditions of use.

Read more insights

Australia to Buy $385 Million Mobile Rocket Launchers from the U.S.

The U.S. State Department approved the sale of High Mobility Artillery Rocket Systems (HIMARS) to Australia, as the nation has been looking to strengthen its military presence in the Indo-Pacific region. 

Special Report-Sustainable Classifications: Relief or Pain?

Governments across Europe, Asia and Latin America are lining up to create a tangible classification on what constitutes a “sustainable investment” and what doesn’t. The uncertainty on sustainable investments has been a challenge for many investors who try to make “sustainable moves”.

Yellen Held Talks on U.S. Investments, China Debt During Visits to Senegal, Zambia

During the first stop in her Africa trip, U.S. Treasury Secretary Yellen on Saturday attended the opening ceremony of a rural electrification project in Senegal that is aimed to deliver reliable power to 350,000 people, while supporting some 500 jobs in 14 U.S. states. After that, she traveled to Zambia to promote U.S. ties and investments in the country, while discussing the country’s heavy debt burden. 

Stay informed

error: This content is protected !!