A sprawling government funding bill set for debate in the Capitol next week could include upward of $120 million for Energy Department testing of the technology behind a troubled uranium enrichment project, a bid to satisfy lawmakers in both parties who have sought a $2 billion federal loan for the facility.

Members of Congress from Ohio and Tennessee -- where the U.S. Enrichment Corp. (USEC) hopes to become the first domestic company to enrich uranium for nuclear reactors through gas centrifuges -- yesterday said they were nearing accord with DOE on adding money for its testing plan to the forthcoming omnibus appropriations package for fiscal 2012.

Rep. Stephen LaTourette (R-Ohio), a member of the House Appropriations Committee, yesterday said a funding infusion initially proposed at $150 million for 2012 could drop to $123 million in the final omnibus deal, expected Monday. But he confirmed that an agreement was near, as did the top Senate Republican for energy spending.

"We're doing our best to see if we can find a way in the omnibus bill ... to test the technology and see if it meets DOE's standards," GOP Sen. Lamar Alexander of Tennessee said yesterday.

USEC counts many supporters among the Ohio, Tennessee and Kentucky delegations thanks to its proposed projects in those states. But its still-pending quest for a $2 billion DOE loan guarantee has drawn a strange-bedfellows group of environmentalist and conservative critics who warn that its technology remains unproven and could lead to a loss on federal investment if the project fails (E&E Daily, Oct. 27).

The omnibus spending bill expected to come to both chambers' floors next week would include the USEC funding in its energy and water title. Funding for U.S. EPA and the Interior Department, however, remains mired in political turmoil over the House GOP's push to include at least some of their three-dozen-plus restrictions on Obama administration environmental policies in a final fiscal 2012 deal.

DOE officials have been reaching out to members of Congress in recent weeks to shore up funding for research at USEC's American Centrifuge Plant in Piketon, Ohio, an official with the department said. DOE asked for a "transfer authority" to use fiscal 2012 funds as well as other currently appropriated unspent money to support research at the plant.

Energy Secretary Steven Chu and other department officials are touting the research program's economic feasibility, pointing to its phased-in approach that would ensure the technology is viable through a pilot demonstration before operations are ramped up toward full-scale commercialization.

"Given the inherent risks of the [plant] and our fiduciary duties to the American taxpayers, we believe that the proposed RD&D is the most prudent course to preserve the option for an indigenous U.S. enrichment technology," Chu wrote in a Dec. 1 letter to Alexander and Sen. Dianne Feinstein (D-Calif.), chairwoman of the Energy and Water Development Appropriations subpanel.

Critics of the technology say it is unproven and that DOE is bowing to political pressure in supporting the plant. But Chu said the project is crucial to the country's security and energy future.

Even so, the path forward remains unclear, and the DOE official said the agency has not yet focused on how it will support the project if Congress does not include funding. Sen. Rob Portman (R-Ohio), a major proponent of the DOE's proposal, said he is still hopeful a loan guarantee will come through for USEC but that supporting operations at the plant in the meantime is just as important.

"In the meantime, we certainly agree that the project [shouldn't] end," Portman said yesterday. "If it did, it would be a terrible waste of taxpayer dollars and it would be much more costly to restart it because we have to have a domestic source of enriched uranium both for national security reasons and for energy security reasons."

Fate of enviro riders

Appropriators and their aides hunkered down yesterday with mere hours left to reach agreement on those environmental riders with the detachment of EPA and Interior funding from the larger omnibus remaining a real possibility (E&E Daily, Dec. 8).

There is "at least a 50-50 chance" that EPA and Interior would have to operate under a continuing resolution (CR) for 2012, Rep. Jim Moran of Virginia, the top House Democratic appropriator in charge of those agencies' budgets, said yesterday.

"Those [riders] that are not of great consequence, we're willing to give in on," Moran added, citing issues such as the methane emissions of large herds of cows that EPA has scant appetite for regulating regardless of congressional mandates.

Stopping the agency from reining in water pollution generated by mountaintop-removal mining and from limiting greenhouse gas emissions, by contrast, made Moran's short list of riders unacceptable to Democrats.

The full House Appropriations Committee's top Democrat, Rep. Norm Dicks of Washington, yesterday echoed Moran's assessment that both the Interior-EPA bill and a separate plan covering labor and health programs remain stalled by policy riders.

Dicks described himself as "hopeful, slightly hopeful" that the impasse could clear by the deadline of today or early tomorrow in order to pave the way for official introduction of an omnibus bill Monday. But he also acknowledged that White House resistance to a separate, rider-free Interior-EPA CR could throw a new wrench in what he described as an "attractive" outcome.

If an Interior-EPA CR does move forward, Dicks said, he would push for it to last for the 10 months remaining in the fiscal year. Environmentalists agree that a 2012-long CR for the agencies, without riders, would be a palatable outcome, and one of their biggest House-side champions agreed yesterday.

So long as Republicans do not insert "other terrible things on other issues" into an Interior-EPA CR that could also cover labor and health programs, Rep. Ed Markey (D-Mass.) said, he could support that approach.

Click here to read a copy of the Dec. 1 letter from Chu.