USEC Gets a Reprieve

Or even wins. Note the two posts about USEC below – it’s all about the company’s American Centrifuge project and DOE’s rejection of its loan guarantee application to move it to the next stage – and USEC’s almost ferocious response to that rejection.

And now, DOE issues a press release:

The Department of Energy and USEC Inc. today announced an agreement to delay a final review on the company’s loan guarantee application for the American Centrifuge Plant in Piketon, OH.

There’s a good deal of give on both sides of the issue. From USEC:

As it has indicated, the Department sees promise in the ACP technology, but USEC’s application does not meet all the statutory and regulatory standards that would permit the agency to grant a loan guarantee at this time. Both DOE and USEC recognize that meeting these criteria will likely take six months or more.

Okay, so USEC accepts that the application needs more work. From DOE:

The Department plans to defer review of the application until a series of specific technology and financial milestones have been met. The milestones that have been conveyed to USEC are in line with the criteria and legal requirements of the 2005 EPACT statute and the subsequent Title 17 loan guarantee regulations.

Okay, okay, so DOE seems ready – or at least willing - to grant a loan guarantee if USEC meets some milestones. We expect USEC can do that and that DOE will be open to granting the guarantee.

However you slice it, a big win for USEC and a demonstration – which we’ve seen multiple times – of the Obama administration’s willingness to roll over an issue a second time to see if it can be done better. It’s unusual – since it raises questions of indecisiveness – but the results are usually pretty good. We’ll take it.

The USEC Piketon Plant – this is where the American Centrifuge will live.

Fluor Invests in NuScale

You know, it’s kind of sad that no one is willing to invest in nuclear energy anymore. Wait, what? NuScale Power celebrated the news of its company-saving $30 million investment from Fluor Corp. Thursday morning with a press conference in Washington, D.C. Fluor is a design, engineering and construction company involved with some 20 plants in the 70s and 80s, but it has not held interest in a nuclear energy company until now. Fluor, which has deep roots in the nuclear industry, is betting big on small-scale nuclear energy with its NuScale investment. "It's become a serious contender in the last decade or so," John Hopkins, [Fluor’s group president in charge of new ventures], said. And that brings us to NuScale, which had run into some dark days – maybe not as dark as, say, Solyndra, but dire enough : Earlier this year, the Securities Exchange Commission filed an action against NuScale's lead investor, The Michael Kenwood Group. The firm "misap...

Wednesday Update

From NEI’s Japan micro-site: NRC, Industry Concur on Many Post-Fukushima Actions Industry/Regulatory/Political Issues • There is a “great deal of alignment” between the U.S. Nuclear Regulatory Commission and the industry on initial steps to take at America’s nuclear energy facilities in response to the nuclear accident in Japan, Charles Pardee, the chief operating officer of Exelon Generation Co., said at an agency briefing today. The briefing gave stakeholders an opportunity to discuss staff recommendations for near-term actions the agency may take at U.S. facilities. PowerPoint slides from the meeting are on the NRC website. • The International Atomic Energy Agency board has approved a plan that calls for inspectors to evaluate reactor safety at nuclear energy facilities every three years. Governments may opt out of having their country’s facilities inspected. Also approved were plans to maintain a rapid response team of experts ready to assist facility operators recoverin...

Nuclear Utility Moves Up in Credit Ratings, Bank is "Comfortable with Nuclear Strategy"

Some positive signs that nuclear utilities can continue to receive positive ratings even while they finance new nuclear plants for the first time in decades: Wells Fargo upgrades SCANA to Outperform from Market Perform Wells analyst says, "YTD, SCG shares have underperformed the Regulated Electrics (total return +2% vs. +9%). Shares trade at 11.3X our 10E EPS, a modest discount to the peer group median of 11.8X. We view the valuation as attractive given a comparatively constructive regulatory environment and potential for above-average long-term EPS growth prospects ... Comfortable with Nuclear Strategy. SCG plans to participate in the development of two regulated nuclear units at a cost of $6.3B, raising legitimate concerns regarding financing and construction. We have carefully considered the risks and are comfortable with SCG’s strategy based on a highly constructive political & regulatory environment, manageable financing needs stretched out over 10 years, strong partners...

NEI Nuclear Notes

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