USEC's Loan Guarantee Application

USEC has applied for a loan guarantee from the U.S. Department of Energy for financing to complete construction of the American Centrifuge Plant. USEC believes it has a well-qualified project that meets all the requirements and the spirit of the loan guarantee program.

A Well-Qualified Project

USEC believes the project is a compelling candidate for a loan guarantee:

• The project fully qualifies as an eligible project under the criteria set out in the Energy Policy Act of 2005. It qualifies as both an advanced nuclear energy facility and an efficient end-use energy technology project.
• The project involves a technology for an advanced nuclear facility in the front end of the fuel cycle.
• It employs new or significantly improved technologies as compared to commercial technologies currently in service in the United States.
• Because the plant will use 95% less electricity than the existing gaseous diffusion plant operated by USEC in Kentucky, it will avoid or reduce air pollutants and anthropogenic emissions of greenhouse gases associated with producing low enriched uranium.

Evaluation Factors

USEC believes the project meets all the mandatory evaluation factors set out DOE’s Loan Guarantee Solicitation, including:

• In 2007, USEC secured the necessary license from the NRC in order to build and operate the plant;
• Piketon, Ohio, is the site of the plant, and construction of the plant is underway. USEC has secured a long-term lease with DOE for the plant facilities, which are being refurbished as part of the construction activities.
• Production trials are complete. Since 2007, the project’s centrifuge machines have been tested in a Lead Cascade test program at the Piketon site. Since August 2007, they have operated for more than 100,000 machine hours, providing data on equipment reliability and machine and cascade design.
• The initial design of USEC's AC100 centrifuge has been finalized and design documents have been released to suppliers to begin manufacturing components.
• USEC has and will continue to provide a substantial equity contribution to the project.
• The plant will be built in the United States and is ready to be deployed to produce a commercially viable product - low enriched uranium.

Desired Outcomes for Loan Guarantee Program

USEC believes the project also will meet all of the desired outcomes listed in DOE’s solicitation:

• Reasonable assurance of repayment
• Optimization of technological diversity
• Accelerated deployment of new uranium enrichment capacity and distribution
• Provides the best use of the DOE’s Loan Guarantee authority in supporting this and other front-end nuclear projects
• Ensures a stand-alone domestic provider
• Meets U.S. government requirements for a domestic provider that can accommodate relevant national security needs

Though the American Centrifuge project merits serious consideration for a DOE loan guarantee, USEC has no assurance that the project will be selected for a guarantee.