For over 60 years, the U.S. nuclear energy industry has served as an American economic and energy lifeblood, employing nearly 100,000 U.S. workers, strengthening communities and providing clean, reliable, and carbon-free power. However, in recent years the industry has suffered premature plant closures, affecting local economies around the country.
Earlier this year, the Department of Commerce initiated a Section 232 investigation into uranium imports after two mining companies, Ur-Energy and Energy Fuels, petitioned the agency to implement a 25 percent domestic purchase quota limiting imports. The two petitioners are asking the Department of Commerce to impose a domestic purchase quota that would leave America less secure and drive up nuclear power plants’ fuel prices by $500-$800 million per year.
This action would undermine the Trump administration’s efforts to preserve at-risk nuclear plants to ensure a resilient grid and fuel diversity for consumers. That’s because this ill-advised investigation could unnecessarily exacerbate the economic challenges faced by nuclear plants, resulting in further nuclear plant shutdowns.
The nuclear energy market provides an emission-free, reliable, and affordable electricity source for the U.S. electric grid, and a diverse uranium supply is an essential component. Uranium is used as fuel to power our nation’s nuclear plants. Today, much of the U.S. uranium supply comes from the U.S. and close, trusted allies. In 2017, U.S., Canada, and Australia accounted for nearly 60 percent of the U.S. uranium supply. Another 11 percent comes from Kazakhstan, a NATO partner that enjoys a strong bilateral relationship with the U.S. China supplied zero percent in 2017.
Import adjustment measures, such as tariffs or domestic purchase quotas, would create national security concerns. Such measures would accelerate the irreversible depletion of the finite domestic uranium supply needed for defense. Indeed, the United States has only one percent of the world’s reserves. Complementing domestic sources with global supply is sound public policy that balances our energy and long-term defense policy goals.
The U.S. military and the civilian nuclear industry enjoy a close decades-long partnership. The imposition of a 25 percent domestic quota could irreparably harm this essential relationship. For example, the Department of Defense depends on the nation’s grid to power 99 percent of its installations, while the U.S. possesses the world’s largest nuclear powered navy. At the same time, foreign economies would benefit from import adjustment measures. China stands to gain a competitive advantage from higher U.S. prices by accessing cheaper non-U.S. uranium for its growing commercial nuclear domestic market.
Tariffs, quotas, or the like would also have significant economic impact — a factor this administration has tied to national security. A review of comments filed in the Section 232 investigation into uranium imports reveals virtually no support for a 25 percent quota on domestic uranium beyond those with a vested interest in the petitioners’ and their allies’ growth. The publicly filed comments from most producers and utilities underscore the potential for catastrophic economic harm to the U.S. nuclear industry and adverse impact to the nation’s national security from a domestic uranium quota. For example, the petitioners employ fewer employees than a single nuclear power plant.
The U.S. nuclear energy industry provides enormous economic and environmental benefits, is critical to our national security and serves as a resilient, clean and reliable energy source. Imposing additional regulatory burdens via Section 232 on the already struggling U.S. nuclear energy industry could unnecessarily cause a dramatic spike in uranium prices that would threaten thousands of good-paying domestic jobs and put our national security at risk.
David Tamasi serves as a national spokesman for the Ad Hoc Utilities Group (AHUG), which consists of a majority of the nuclear generators in the U.S. including Ameren Missouri, Dominion Energy Services, Inc. on behalf of Virginia Electric and Power Company and Dominion Energy Nuclear Connecticut, Inc., Duke Energy Carolinas, LLC and Duke Energy Progress, LLC, Energy Northwest, Entergy Operations, Inc. and Entergy Nuclear Operations, Inc., Exelon Generation Company, LLC, Pacific Gas and Electric Company, PSEG Nuclear LLC, South Carolina Electric & Gas Company, and Xcel Energy Services Inc.
