This week, the U.S. Department of Energy announced the first selection of 11 projects aimed at developing advanced nuclear test reactors. This initiative aligns with the Trump administration’s ambitious goal to rejuvenate the domestic nuclear supply chain and significantly increase U.S. nuclear energy production by 2050.
One part of Trump’s strategy involves boosting uranium enrichment, a sector largely controlled by international players. Earlier this month, hints of this resurgence came with the announcement of a new enrichment facility in Kentucky.
The U.S. once led the world in uranium enrichment, maintaining a dominant position in the global nuclear market until the 1980s. However, years of neglect combined with stiff competition from foreign state-owned companies, which benefit from various subsidies and trade protections, have left the U.S. unable to enrich sufficient uranium for its commercial and national security demands.
State-owned enterprises in Russia, China, and Europe now control nearly all global uranium enrichment capabilities. Unfortunately, these foreign entities can’t fulfill specific national security needs for enriched uranium.
In 2019, President Trump initiated changes. His Energy Department contracted with a U.S. firm to showcase centrifugal enrichment technology in Ohio. Progress has been made, but the number of operational centrifuges remains limited.
The Department of Energy has allocated roughly $3 billion to boost U.S. uranium production. Biden’s administration selected projects that include two European state-owned firms already active in the U.S. market, a U.S. company in Ohio, and some startups with less certain development paths.
The forthcoming funding decision by the Trump administration will determine how the $3 billion is distributed, focusing on U.S. firms versus established European ones. It’s noteworthy that, during certain periods, the U.S. hasn’t fully depended on foreign entities in this crucial sector.
Back in the 1940s and 1950s, the U.S. established three major uranium enrichment facilities in Tennessee, Kentucky, and Ohio. These were pivotal in giving the U.S. a near monopoly that contributed to winning the Cold War, establishing a nuclear navy, and supplying nuclear fuel to allies globally. The ability to sell fuel also granted the U.S. significant geopolitical influence by requiring other countries to comply with its safety and security standards.
In the 1970s, European nations invested heavily in their uranium enrichment capabilities, reducing their reliance on the U.S. and initiating the Corfu Declaration—an internal policy limiting U.S. suppliers’ access to the European market.
Over time, Russia and China began to supply enriched uranium to the U.S., but fundamentally, their state-run enterprises don’t enrich for the U.S.
By 1985, while the U.S. was no longer the only player, it still held considerable influence.
In the 1990s, the U.S. privatized its enrichment efforts, giving rise to Centrus Energy, the only public company in a market largely dominated by foreign state-run enterprises. This means American enrichment firms must compete on an uneven playing field against foreign competitors that benefit from government support.
The company managed two remaining government enrichment plants utilizing outdated technologies from the 1950s. Cheap imports from Russia—stemming from a 1990s agreement—and tough competition from European enrichment facilities led to their closure in 2001 and 2013.
Currently, for refueling private reactors, the U.S. is almost completely dependent on foreign state-owned companies, which possess close to 100% of global enrichment capacity. This marks the first time since the Roosevelt administration that the U.S. lacks the ability to enrich uranium for its national security needs.
State-owned European enrichers:
- Orano, owned by the French government, contributes roughly 12% of global enrichment capacity and is currently expanding its operations in France with significant government support. It has also applied for $3.4 billion in U.S. government funding for a new enrichment plant in Tennessee.
- Urenko, a consortium involving the UK, Netherlands, and Germany, operates plants in all its owner countries, including one in New Mexico that can cater to about a third of U.S. commercial demand, though it’s not available for security missions. Urenko is in competition with Orano, which has substantial funding lined up.
Both Orano and Urenko utilize European centrifugal designs produced only in Europe, primarily in the Netherlands and Germany. This results in most advanced manufacturing jobs related to centrifuges being located there, with Centrus Energy being a notable exception, lacking national subsidies.
