Friday’s news, company officials acknowledged, wasn’t the approval they had hoped for, but USEC officials said it could help the Department of Energy satisfy any remaining concerns about the project’s technical viability and, hopefully, bring the company closer to the needed loan guarantee.
Under the agreement, the Department of Energy will request a transfer of $150 million to use existing funds to pay for a research and development project at the southern Ohio plant.
The federal government would pay for 80 percent of the project through the initial phases of the project, and 20 percent during the build-out phase. The federal government would pay no more than $300 million throughout the course of the project.
“This preserves a path for USEC and our shareholders to obtain value from the investment they have made in the American Centrifuge project,” said John Welch, president and CEO of USEC.
Department of Energy spokesman Damien LaVera said while the agency still has not decided to offer USEC the loan guarantee, “DOE and USEC remain supportive of a path to commercializing this innovative technology.”
“However, DOE and USEC both believe additional work demonstrating the technology would benefit the project by reducing technical and financial risks associated with the project,” he said.
He said the joint project would involve manufacturing additional production design machines on a path toward one “train” of 720 centrifuges so that key systems can be tested as they would actually operate on the scale necessary for full commercialization.
LaVera said if the effort is successful, the project would be “much better positioned” for commercialization.
USEC spokesman Paul Jacobson said it’s unclear how the news will affect the potential for layoffs.
A spokesman for Ohio Gov. John Kasich called the announcement “an encouraging interim step.”
“The governor’s goal is to see Piketon get the federal loan guarantee it needs to build out the next generation of enrichment technology and reinvigorate southern Ohio’s economy,” said Kasich spokesman Scott Milburn.
Sen. Sherrod Brown, D-Ohio, said the move would help satisfy any technical concerns the Department of Energy might have.
“It’s a very positive step,” he said.
But Sen. Rob Portman, R-Ohio, said while the news appears positive, the company will still need a conditional loan for the project to succeed.
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