NUCLEAR:

A 'robust' new fuel supply for nuclear power plants is emerging

PIKETON, Ohio -- A group of U.S. engineers and technicians sat down one day in 2001 to figure out where the nation's future nuclear power plant fuel was going to come from. Their decision was to leap backward 30 years and re-engineer an idea perfected during the Cold War and then abandoned here in 1985.

The technology -- an ultra-high-speed, 40-foot-high centrifuge that can produce enriched uranium -- was hunted down in government archives. At first, it was an adventure in industrial archaeology. "All the drawings and the specs were in a vault at [the National Laboratory] at Oak Ridge [Tenn.]," explained Daniel W. Rogers, who became general manager of the resurrected program. "We spent a year looking at them."

Nearly everything had changed since President Reagan canceled the $3 billion centrifuge program on the fateful day of June 16, 1985. Then, the United States was by far the world's leader in nuclear-generated electricity. It dominated the world market in the enriched uranium fuel that nuclear power plants 'burn' to make steam and then electricity. But Reagan and his advisers were smitten with a more futuristic technology, one that used lasers to solve the enrichment problem, which requires separating the power-producing isotope of uranium -- called U-235 -- from its close cousins in uranium feedstock.

By 2001, much of the U.S. nuclear industry was in shambles or being sold in pieces to foreign companies. U.S. dominance of the world nuclear fuel market had begun to wane. The U.S. Department of Energy concluded that laser-isotope separation wasn't commercially feasible. And a number of experts had begun to convince the Bush administration that a "nuclear renaissance" was needed, both for U.S. energy independence and to show other nations a plan to reduce greenhouse gas emissions.

Rogers, a stocky engineer who was present at both the death and the rebirth of the U.S. centrifuge, still recalls the "extreme shock" in 1985, when 2,500 employees at work here on the centrifuge project were told that its budget was canceled. He also remembers when the experts reached the conclusion in 2001 that the United States should make another try. Most of the men in the room who knew much about the centrifuge program were in their seventies.

The 'American centrifuge' is fast, but it's in a race

But now the first prototypes of that centrifuge, called the "American centrifuge," are up and running. A new generation of engineers hover over their computers, making the refinements needed to produce an estimated 11,500 of the machines by 2012 to form what engineers call a "cascade," or a plant that produces enriched uranium.

Rebuilt with super high-strength carbon fiber components and fashioned by computers and robotics not even imagined in 1985, the machine is the U.S.-built centerpiece for a high stakes, five-way race to see who will dominate the globe's nuclear fuel business.

Its sponsor is USEC Inc., the private, Bethesda, Md.-based company that was spun out of the U.S. Department of Energy's old uranium enrichment program in 1998. If USEC succeeds in getting a $2 billion loan guarantee from the Department of Energy, it says it will build "the most advanced uranium enrichment machine in the world." The company says it has already signed up 10 customers for the plant that want $3.3 billion worth of fuel.

According to the nuclear industry, there are at least 60 new nuclear power plants either under construction or being planned around the world. USEC, which currently produces the nuclear fuel that feeds about a third of the world's nuclear plants and half of the U.S. market, will be in a fight to keep market share as the world's demand for nuclear fuel expands.

The idea that a technology first developed for nuclear weapons might save the planet might seem bizarre to some, but it is one of the banners USEC is waving. If the United States could capture a good chunk of the growing global nuclear fuel market, the company says, the result would be "more than one million" high-paying jobs, and USEC insists they will be green jobs. "Nuclear power is the world's largest energy source that does not emit greenhouse gases," the company notes in a pamphlet touting "The American Centrifuge."

The competition USEC faces, both here and abroad, is formidable. Three competitors with foreign connections are setting up operations here to compete directly with USEC for the U.S. nuclear fuel. In addition, Russia -- which currently supplies about half of the U.S. nuclear fuel market with uranium fuel whose enrichment is blended down from dismantled nuclear weapons -- has its own global nuclear market ambitions.

Spinning from weapons programs into commerce

Experiments to transform uranium into a gas and then spin it in a centrifuge to capture the lighter U-235 isotope were begun first in the United States and developed by the government during the 1960s as the successor to an older and much more energy-intensive technology called gaseous diffusion that was developed during World War II. However, the uranium centrifuge process was first commercialized for power plant fuel in Europe by Urenco, a consortium of Dutch, German and British companies and government-owned entities. Meanwhile, Russia developed its own centrifuge program.

Urenco, operating under the name of Louisiana Energy Services, is building a uranium enrichment plant in Eunice, N.M. According to Gregory Smith, the chief operating officer of LES, the so-called "National Enrichment Facility" will be capable of supplying about half of the U.S. domestic requirements for nuclear power plant fuel.

In order to keep up with $29 billion worth of orders for nuclear fuel worldwide, in November, the company decided to double the size of its emerging U.S. plant. "It's all about price and reliability," explained Smith, who said the new plant, which may begin operations this year, has enough orders to keep it running at 100 percent capacity to 2016.

Areva Inc., the U.S. subsidiary of a French-owned company, announced late last year that it will build a $2 billion enrichment facility near Idaho Falls, Idaho. The company predicts it will be running by 2014. "The world is back on nuclear, and the U.S. will be, too," explained Jacques Besnainou, president of Areva Inc.

The French company, which uses a variant of the Urenco centrifuge, will need licenses to operate in the United States, and it is busy trying to show U.S. and state officials that the plant and many of its suppliers will create jobs in the United States. "We are going to bring everything here," added Besnainou.

A U.S.-Japanese-Canadian-Australian entry

General Electric has contracts with U.S., Japanese and Canadian firms to use an Australian process to enrich uranium with lasers. Because it operates on molecules rather than on atoms, the technology differs from the failed U.S. laser enrichment program. GE plans to test it at a facility in Wilmington, N.C., and has tentative plans to start a commercial facility as early as 2012.

If it works, the laser enrichment process could open up vast new supplies of enriched uranium because, unlike centrifuge technologies, lasers might be able to extract more U-235 out of old uranium mining and processing wastes, which are called uranium "tails." The United States has a great abundance of them.

While other parts of the picture of a nuclear "renaissance" may still seem somewhat murky, industry officials are elated about future fuel supplies. "With four planned new enrichment facilities in the works, we are approaching a robustness of fuel supplies that we have not seen in decades," said Alex Flint, senior vice president for government affairs at the Nuclear Energy Institute.

Thomas Neff, a senior researcher at the Massachusetts Institute of Technology who has followed the nuclear fuel industry for 30 years, is not that sanguine. He worries that not all these timetables will work out, and that there could be a fuel shortage as early as 2013, when the Russian government has said it will pull out of the U.S. market. Russia wants to use its uranium fuel to feed a growing internal need for nuclear fuel and to compete in other rapidly growing nuclear markets, such as India and China.

The end of the fabled "Megatons to Megawatts" deal, which Neff helped inspire, will leave a big hole in the U.S. market. Neff is particularly skeptical of USEC's ability to compete in the future enrichment market, where he thinks it could be underpriced by more advanced competitors.

That could leave the United States, the pioneer of both centrifuge enrichment and the nuclear power plant, without a totally domestic source of enriched fuel. Referring to the 40-foot-high centrifuges, dredged out of past U.S. experiments and much larger than either the Russian or the European versions, Neff worries they may prove to be too expensive to compete.

"The other problem with these 40-foot monsters is that nobody knows how long they will last," he adds. Still, Neff and others involved with the nuclear fuel cycle have difficulty seeing a coherent U.S. energy policy without a future nuclear component.

Manufacturing the materials for photovoltaic solar arrays and durable wind turbines will require a large amount of electricity, and nuclear power is the only relatively clean energy source Neff sees as being capable to meet that demand. "Nuclear is the bridge to that future."

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