A key Senate appropriator is taking Energy Secretary Steven Chu to task for his handling of an embattled uranium enrichment facility.

Sen. Dianne Feinstein (D-Calif.), chairwoman of the Senate Energy and Water Development Appropriations Subcommittee, expressed concern in a Jan. 23 letter to Chu about the Energy Department's decision to assume $44 million of liability to support U.S. Enrichment Corp.'s uranium enrichment plant in Piketon, Ohio.

DOE acted, she wrote, as she was trying to fulfill Chu's request for $150 million to support the USEC plant.

"This action raises significant concerns," Feinstein wrote.

USEC's $5 billion American Centrifuge Plant (ACP) has failed to secure a $2 billion federal loan guarantee, but DOE says the project offers economic and national security benefits. The plant would be the first to use domestic gas centrifuge technology to produce low-enriched uranium for nuclear reactors (E&ENews PM, Jan. 17).

Feinstein said she worked with the subcommittee's ranking Republican, Sen. Lamar Alexander of Tennessee, to provide $150 million for research and demonstration at USEC while protecting taxpayers.

The subcommittee's provision would have required DOE to change leadership at the plant and establish a consortium that included outside companies, Feinstein said. Chu had indicated those companies would be Babcock & Wilcox and Toshiba, she wrote.

DOE also had to clarify the government's intellectual property rights to the gas centrifuge technology if the new research, development and demonstration (RD&D) program failed to prove commercially viable. The original centrifuge technology is federally owned and licensed to USEC.

"If the ACP does not to move forward after the RD&D investment, it is in the best interest of the country to avoid years in court clarifying issues of intellectual property," Feinstein said.

But Senate appropriators never received a response to their offer from the House, and the language was never included in the fiscal 2012 spending bill, she said.

Instead, Chu announced in letters to Ohio Sens. Sherrod Brown (D) and Rob Portman (R) last year that the DOE would assume partial liability for the project. Feinstein said Chu had indicated months earlier that such a step wouldn't be warranted without the support of Congress.

Feinstein said she now wants to know how DOE will protect taxpayers and whether the department will clarify its position on intellectual property.

"Your letter simply states that you are 'taking precautions to protect taxpayers' without any further explanation," Feinstein said. "I request that you explain the benefit of this tails transfer to the federal government and what precautions you have taken to protect the taxpayer."

DOE spokeswoman Jen Stutsman said the department is reviewing Feinstein's letter and will insist on "strong taxpayer protections, including receiving uranium enrichment services that can be used for critical national security applications."

"We appreciate the significant effort by Senators Feinstein and Alexander and their colleagues to try and provide the transfer authority the Energy Department needs to move this important project forward, and we look forward to continuing to work with the senator to address her concerns," she said.

Click here for Feinstein's letter.