Those involved with advanced reactors are well aware of the issues associated with high-assay low-enriched uranium (HALEU) fuel: advanced reactors need HALEU to operate, but the U.S. doesn’t have domestic production capabilities to make it.  And there’s a “chicken” and “egg” issue to solving this problem—fuel cycle facilities don’t want to commit the resources towards developing a HALEU supply chain until they know they have an established market.  The established market cannot emerge until the reactors are built, and they cannot run without fuel.  We have blogged about this issue many times over the years, including developments in trying to stand up U.S. HALEU production capabilities (See, e.g., here).

What is HALEU?  Traditionally, the U.S. nuclear power plants are powered by uranium enriched up to 5% with uranium-235—the main fissile isotope that produces energy during a chain reaction.  HALEU is still low enriched uranium, but between 5-20%.

Who uses HALEU?  Most advanced reactor developers intend to rely on HALEU fuel.  Among other things, the higher enrichment levels enable the reactors to have a smaller design, better fuel utilization, and longer fuel cycles.  Both the Department of Energy’s Advanced Reactor Demonstration Program (ARDP) awardees—TerraPower and X-energy—use HALEU fuel.  These projects are expected to be completed by late 2027/early 2028, and they will likely not be able to procure their enriched uranium in the U.S.  Overall, the domestic nuclear industry anticipates it may need nearly 600 metric tonnes of HALEU by 2030 in order to deploy new reactors to market.

HALEU can also be used by the existing fleet, with the nuclear industry expressing interest in using fuels for light water reactors (LWRs) enriched between 5-10%.  Some advanced fuel developers are also looking at new LWR fuel designs at just under 20% enrichment levels.

Who makes HALEU commercially for advanced reactors?  Currently, no one in the U.S.

Is that a big deal?  Yes, because it undermines U.S. energy independence and security.  Also, HALEU production capabilities are very limited globally.  The only current options right now?  Pretty much just Russia.

Are we starting from scratch?  No, but it will take time to stand up a domestic production source. There is one operating uranium enrichment facility in New Mexico—Urenco—that makes uranium enriched up to 5.5%, but advanced reactors use HALEU much closer to the 20% threshold.  Urenco could expand its existing facility to add in HALEU production—the company is exploring this option as we have previously blogged about—but that is a time intensive and expensive task. Another company—Centrus—has been working with the Department of Energy to develop a new enrichment technology that could support HALEU production, but according to the company’s last quarterly report the project has experienced some delays and DOE may not continue funding through the operational phase without a competitive bid of some sort.  And in any event, a full-scale facility would still need to be licensed and constructed before being able to supply HALEU commercially.

What’s government’s role?  The Department of Energy (DOE) is supporting HALEU development.  In December 2021, DOE issued a Request for Information (RFI) for public input on its planned program to ensure domestic availability of HALEU for the U.S. fleet (responses to DOE’s RFI are due on February 14, 2022).  The Energy Act of 2020 authorized DOE to establish a program for domestic sourcing of HALEU for research, development, demonstration, and commercial use. We summarized the Energy Act provisions in a previous blog post.  The stalled Build Back Better legislation would have funded this program with $500 million (also summarized in a previous blog).

Recent developments: This month, the Nuclear Energy Institute (NEI) issued a white paper on “Establishing a High Assay Low Enriched Uranium Infrastructure for Advanced Reactors” which outlines their recommendations to support HALEU deployment for advanced reactors before 2030.  And late last month, the U.S. Nuclear Regulatory Commission (NRC) staff requested Commission permission to undertake a rulemaking to evaluate and amend the NRC regulations related to HALEU for the existing fleet, taking into account enrichment levels of up to 10%.  We summarize both briefly below.

NEI HALEU White Paper

NEI’s white paper walks through many of these issues—setting forth the underling HALEU issue and recommended next steps to developing a domestic production source.  Acknowledging that the greatest hurdle facing this effort is the tremendous upfront capital required—an estimate of more than $500 million for enrichment and deconversion—the paper explains that this capacity will not emerge without a governmental push to create a sustained customer base.

As outlined in the white paper, NEI’s recommendations to support development of domestic HALEU include the following:

  • DOE should expeditiously establish the Advanced Nuclear Fuel Availability Program authorized by the Energy Act of 2020 (summarized in one of our previous posts) and immediately commence the funding processes, and Congress should provide the requisite funding for this program
  • DOE should incentivize licensing, construction, and deployment of two U.S. commercial HALEU enrichment facilities, through a competitive procurement process
  • DOE and other agencies should not impede acquisition of HALEU by industry from international suppliers within the framework of existing trade agreements, and DOE should consider assisting with HALEU transportation and storage
  • DOE should support and incentivize development and deployment of deconversion facilities
  • DOE should support the certification and manufacturing of new shipping packages for certain HALEU
  • Processing of Experimental Breeder Reactor-II fuel should be expedited

NRC staff requests rulemaking to support domestic HALEU supply chain

In an activity that would impact fuel for the existing fleet, and potentially advanced reactors, on December 20, 2020, NRC staff submitted a memorandum to the Commissioners (SECY-21-0109) that requested permission to undertake formal rulemaking to evaluate the regulations impacting LWR fuel enriched greater than 5%.

The NRC identified at least two regulations that set forth an enrichment limit of 5% that would need to be amended.  In addition, the staff would perform a more comprehensive review of regulations associated with uranium enrichment throughout the life cycle of fuels for LWRs. The goal of this review would be to identify regulations that could be modified to increase flexibility and reduce exemption requests for the use of increased enrichment fuel while maintaining safety.

The staff further explained that while a rulemaking is not necessary to support the licensing of fuel enriched over 5%, the staff is recommending the rulemaking “to reduce unnecessary exemption requests and facilitate increased regulatory efficiency and consistency while continuing to ensure safety.” The rulemaking would also enable the “staff to thoroughly review the potential regulatory implications of increased enrichment fuels and identify and assess the potential costs and benefits of changing regulatory requirements that impact their use” as well as pursue a “generic resolution of these issues.”

While the NRC staff noted in the SECY paper that the LWR community was interested in fuel enriched between 5-10%, the NRC also recognized that advanced reactors intend to utilize greater enrichment levels—something the NRC is reviewing under its advanced reactor Part 53 rulemaking.  The staff explained that it “plans to further evaluate applicability to advanced reactor fuel designs in the regulatory basis to ensure alignment with the Part 53 rulemaking.” And that “if the rulemaking schedule and stakeholder interest align, this rulemaking scope could be expanded, or a separate rulemaking could be initiated for advanced reactor fuel designs.”

For additional information regarding these developments, please contact the blog authors, Amy Roma, Partner, or Rob Matsick, Associate.