Jeremy L. Dillon
WC Monitor
9/18/2015

The Department of Energy will no longer provide funding for Centrus’ American Centrifuge project operations at its Piketon, Ohio facility, the company confirmed late last week. The announcement also noted a one-year extension funding for the American Centrifuge project’s research and development contract with the Oak Ridge National Laboratory – but with funding reduced by 60 percent. Funding will be at $35 million per year, and the scope of activities will be limited to development activities at ORNL. Additional extensions are possible, the company said.

The decision likely means a halt to operations of the nation’s sole “cascade of advanced uranium enrichment centrifuges” at the Piketon site, Centrus said in a press release.

 “While obviously we are disappointed by the decision to significantly downsize America’s advanced centrifuge program, we appreciate the Laboratory’s recognition that the technology has been effectively demonstrated over the last two years of hard work at Piketon,” Centrus Vice President Steve Penrod said in a statement. “We will work with the Laboratory and with Congress to protect as much of the core capabilities of the program as possible so that the technology will remain ready for deployment when the U.S. government calls upon it for national security purposes.”

As a consequence of the funding reduction, Centrus will most likely need to lay off a large number of its Ohio workforce. Management anticipates “that it will incur costs, which are being evaluated, associated with the reduction in workforce and the further demobilization of the program,” according to the release. If the company needs to close its Piketon facility, Centrus “would incur still further costs associated with that closure and return of the facility in compliance with U.S. Nuclear Regulatory Commission requirements and pursuant to its lease with DOE.” Centrus currently employs 280 technical and other staff in Piketon.

DOE did not respond to requests for comments on the decision.

Centrus Energy Corp., formerly USEC, is maintaining the American Centrifuge technology under a subcontract to Oak Ridge National Laboratory (ORNL) that would have expired on Sept. 30. Under the agreement, ORNL manages the work, while Centrus maintains the American Centrifuge technology for possible future deployment. While Centrus hopes for deployment of a train of centrifuges for national security purposes, the Department of Energy, with this announcement, appears to have decided against furthering the fielding of the technology.

Ohio Delegation “Stunned” at Announcement

Ohio’s congressional delegation expressed shock and disappointment at the decision, especially at how it will drastically affect the Ohio workforce. “I am stunned by today’s announcement by the Administration that they are pulling the plug on our country’s uranium enrichment project. This news is a major blow to the Piketon community and southeast Ohio and yet another broken promise by this Administration,” Sen. Rob Portman (R-Ohio) said in a statement. “Families are once again being upended by the Administration’s failed promises to the community and its inability to manage projects at the Piketon site. Congress has consistently signaled strong support for ACP and the irreplaceable role it plays in our national security and economic security.”

Portman said he has already reached out to many local stakeholders, including the Department of Energy, the local union, contractor, and other local elected officials. “Should our efforts fail to convince the Administration to reverse its position, I stand ready to work with local officials to help the hundreds of workers in Piketon who will have lost their jobs through no fault of their own,” he said.

Rep. Brad Wenstrup (R-Ohio), whose district includes the ACP, expressed similar sentiments. “This is beyond belief,” he said in a statement. “Congress, the people’s elected representatives, responsibly and repeatedly prioritized the American Centrifuge Project with full funding. The project is a national security imperative to ensure we have a continued domestic supply of enriched uranium to support our nuclear weapons program and the Navy nuclear reactors program. This is a shameful and unilateral move by Department of Energy to walk away from a longstanding investment, and leaves the region and the nation blindsided with another broken promise.”