Apr 21 - McClatchy-Tribune Regional News - Jonathan Riskind The Columbus Dispatch, Ohio



It's a possible good news/bad news story for the planned $3.5 billion uranium enrichment plant project in Piketon that could bring hundreds of jobs to economically struggling southern Ohio.

The Department of Energy is moving ahead with plans to double, the amount of federal loan guarantees available for enrichment projects to $4 billion. But that move also could double the competition the Piketon project faces for a loan guarantee it must obtain to survive.

The Obama administrations intent apparently is to be able to grant separate $2 billion loan guarantees to the USEC project in Piketon and a competing enrichment plant being built in Idaho by French-based Areva.

USEC is a former federal corporation turned private company, based in suburban Washington, D.C., which ran the old enrichment plant at Piketon that was shuttered in 2001. Uranium enrichment plants produce nuclear power plant fuel.

 But two other large companies are trying to build new enrichment plants in the United States. A subsidiary of Urenco, a company partially owned by the British and Dutch governments, is working on a project in New Mexico. Meanwhile, a General Electric-affiliated consortium wants to build a plant in North Carolina.

Neither company applied for the initial $2 billion loan guarantee that the energy department said would be made available for enrichment plants.

Areva and USEC both applied. Arevas application is pending. USECs application was rejected last year by the energy department, which said USEC had not yet shown that its centrifuge technology would be commercially viable.

The energy department agreed to let USEC reapply later and gave the company $45 million to carry out more research and development. USEC officials insist the company is on track to operate a successful plant.

The rejection of the USEC application created a political firestorm in Ohio. During the 2008 presidential campaign then-candidate Barack Obama promised to support USECs application.

Urenco, whose project is run by a company called Louisiana Energy Services, seems poised to apply for an additional $2 billion loan guarantee.

A new guarantee should be awarded based on the merits of the projects, not on a first come first served basis, Gregory Smith, the companys chief operating officer and chief nuclear officer, said in a recent letter to Secretary of Energy Steven Chu.

General Electrics project in North Carolina is run by a company called Global Laser Enrichment. Energy Daily, which covers the nuclear industry, reported this week that the head of Global Laser has made the case to the energy department for allowing the company to apply for a new loan guarantee.

GE did not comment, referring to a prior statement that it is looking at all opportunities to engage the U.S. government in the enrichment project.

Asked about the potential new competition for a loan guarantee, USEC spokesman Jeffrey Donald said, Were focused on taking the steps necessary to address (the energy departments) technical and financial concerns in preparation for updating our loan guarantee application later this year.

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