In December, 2013, USEC, Inc., the company building the American Centrifuge Plant (ACP) to enrich uranium at Piketon, OH, announced it would file for bankruptcy in the first quarter of 2014. USEC said they are restructuring to write off $530 million in debts. Unbelievably, bankruptcy did not end government subsidy for the ACP.
* Just hours after USEC announced bankruptcy, the U.S. Department of Energy (DOE) announced it would subsidize $24 million to keep the nonfunctional ACP afloat for 3 more months.
* On the same day as the bankruptcy, USEC announced they are seeking new investor money because of a “National Security Train Program” (sic) utilizing ACP technology to be subsidized by the government for not less than $750 million. No official DOE or other government documents could be found mentioning a National Security Train Program, and neither the DOE nor USEC would comment on the program.
* In January, 2014, the U.S. House passed a federal spending bill that included $118 million in subsidies for the ACP.
Wean Ohio politicians off pork!
WHAT SOLYNDRA? Many Republicans such as U.S. House Speaker John Boehner from Ohio pushed aggressively for the DOE to give a $2 billion loan guarantee to USEC to finish the ACP at the same time they were attacking the DOE for its loan to Solyndra, the solar energy company that later failed leaving taxpayers holding the bag for $500 million. Now Mr. Boehner and Democrats, too, want to subsidize a company that is already bankrupt.
WHAT JOBS? Ohio senators Rob Portman (R) and Sherrod Brown (D) have strongly supported every public giveaway to this failing project. Do you think politicians might be embarrassed to be seen throwing money at a sinking ship? Apparently not, as long as the ship is flying a “JOBS” flag in their districts. Trust of the public money isn’t the only thing Ohio’s politicians may have forgotten. They have abandoned reality checks, quoting industry’s fantasy number of 4000 jobs to be created at Piketon. The URENCO uranium enrichment plant — a competitor that also uses centrifuge technology — opened in 2010 in New Mexico. They currently have 236 employees and had less than 1000 during the height of construction.
WHAT NATIONAL SECURITY? What exactly is the national security purpose that the ACP fills? Why is USEC so important to this? A reason given for subsidizing the failed ACP is for a “domestic source” of enriched uranium. Having the ACP switch from making low-enriched uranium for nuclear power to making high-enriched uranium for nuclear weapons is now being openly discussed. According to the Federation of American Scientists, the U.S. currently has 7,700 nuclear warheads. How many is enough?
What else is wrong?
* In the same bankruptcy document it filed with the Securities and Exchange Commission, USEC conceded that there is no market for the enriched uranium that the ACP would produce. Worldwide there is a glut of capacity to enrich uranium.
* The ACP uses centrifuge technology that was canceled by the Reagan Administration because it was outdated at that time. The ACP missed its deadline for operating its lead (trial centrifuges) cascade way back in 2006, with a serious accident in 2011 damaging 6 centrifuges and rupturing one. While the DOE is now saying that operation of the lead cascade has been accomplished, skeptics aren’t convinced as to its viability.
* In November, 2013, the Washington Examiner reported in its Enrichment at the Public Till series that USEC has spent up to $5 million a year on lobbying, even when the company's worth was as low as $18 million.
* Current U.S. Secretary of Energy Ernest Moniz was a paid member of USEC's strategic advisory council from 2002 to 2004.
* USEC has so far put about $2.5 billion, much of this subsidized by the Dept. of Energy, into the ACP.
USEC was given sole authority to purchase and redistribute highly-enriched uranium from Russia’s dismantled nuclear weapons under the Megatons to Megawatts program. This helped keep them afloat until the program expired in 2013. In another gift, the DOE took responsibility for depleted uranium hexafluoride, a radioactive waste product of USEC’s former gaseous diffusion enrichment process.
The 1992 privatization agreement which turned over the government-owned U.S. Enrichment Corporation to the private USEC, Inc. also had many perks for the company. The primary gift to USEC at that time was millions of dollars worth of natural uranium. The agreement also included lucrative contracts for both operation and cleanup of the older-technology uranium enrichment plant at Piketon as well as continued operation of a similar plant in Paducah, KY, which later received millions more in subsidies.
In 2012 the DOE took an ownership share of USEC’s operation, which suggests they had concerns about USEC’s financial condition.
* USEC has no credible financing plan for finishing the ACP. The only plan they have is to keep asking the DOE for a $2 billion loan guarantee, which fortunately the DOE has so far refused.
* In December, 2013, USEC announced that the final cost of the ACP will be $6.5 billion, to be completed by 2017, whereas initially the cost was to be $1.7 billion and completed by 2005. How will a bankrupt company come up with $4 billion needed to finish the ACP? WE SAY, NOT FROM THE TAXPAYERS!
What you can do
* Contact Senators Portman (800) 205-6446 and Brown (888) 896-6446 or email them from their websites http://portman.senate.gov and http://brown.senate.gov.
* Contact House Speaker Boehner at (202) 225-0600 or email him from his website http://boehner.house.gov.
* Find and contact your U.S. Congressional Representative at www.house.gov/writerep.
* Find and contact your state senator and representative at www.ohiosenate.gov and www.house.state.oh.us.
Check out the Nuclear Free Campaign of the Sierra Club Facebook Group and follow @NuclearFreeSC on Twitter.