Bond Rating, Technical Problems, National Security Concerns All Impediments to Uranium Enrichment Project’s Success, Says Congressman
 
WASHINGTON (January 20, 2012) – Rep. Ed Markey (D-Mass.) today expressed his opposition to the continued support by the Obama administration of the floundering United States Enrichment Corporation (USEC), following the recent steps by the Department of Energy to free up $44 million for USEC to keep itself afloat. Rep. Markey, in a letter sent to Energy Secretary Steven Chu, cites the poor bond rating, significant problems with the technology, and concerns about USEC’s partnerships with Russia and their ties to the Iranian nuclear program as reasons that the facility may never reach full commercialization.
 
“I believe that this support is unlikely to result in the successful commercialization of USEC’s domestic uranium enrichment technology, and is additionally unjustifiable using assertions of this project’s importance to national security,” writes Rep. Markey to Chu. Rep. Markey is the top Democrat on the Natural Resources Committee and a senior member on the Energy and Commerce Committee.
 
Rep. Markey’s letter to Secretary Chu is available HERE.
 
Rep. Markey cites three main factors for concern related to continued support of the project:
 
·         Technical problems: USEC has already had to withdraw a loan application because of concerns with its centrifuge technology, which have yet to be resolved. The centrifuges have failed due to multiple problems ranging from electrical failure, backup diesel generator startup problems, and human error to an unexpected mode of centrifuge failure.
·         Bond rating: USEC has been given a CCC+ bond rating, which means default is a significant possibility. Because of the company’s liabilities and small market value, Rep. Markey writes that USEC will likely never reach commercialization, because “[p]rivate markets would never provide a company with such a small capitalization and poor credit rating the financial backing to complete a project worth 25 times the value of the entire company.”
·         National security concerns: Enriching fuel to obtain tritium for U.S. nuclear weapons must be done using domestic enrichment technology. Yet USEC’s recent announcement to explore technology and uranium sharing agreements with Russia raises significant national security and non-proliferation concerns. The Russian state-owned company with whom USEC is partnering has ties to the Iranian nuclear program.
 
“Rather than enhancing national security, it seems to me that DOE’s continued support of USEC could result in its indirect support of Iran’s nuclear weapons program,” writes Rep. Markey.
 
Due to his concerns, Rep. Markey asks Secretary Chu for information regarding DOE’s analysis of the national security and nonproliferation concerns with USEC and its potential partnerships; financial reports and other documents related to USEC’s application for loan guarantees; and how taxpayers are being protected in light of DOE’s continued support of the program.
 
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