HALEU supply plans detailed in DOE draft solicitations and scoping notice

June 7, 2023, 9:30AMNuclear News

The Department of Energy released two draft requests for proposals to acquire high-assay low-enriched uranium (HALEU)—one covering enrichment services that could include the production of between 5 and 145 metric tons of HALEU during a 10-year performance period, and another for deconverting that HALEU from uranium hexafluoride (UF6) gas to metal or oxide forms in preparation for fuel fabrication. The DOE also issued a notice of intent to fulfill its National Environmental Policy Act (NEPA) obligations for the HALEU Availability Program by launching the scoping process for an environmental impact statement; that notice was published in the Federal Register on June 5.

The DOE is looking for feedback on its draft HALEU RFPs ahead of the final solicitations expected later this year. While potential RFP respondents have until July 6 to comment, the public has 45 days (through July 20) to comment on the DOE’s scoping process for the EIS.

Statement of need: The DOE estimates that more than 40 metric tons of HALEU could be needed by the end of the decade, with additional HALEU required each year to fuel a fleet of advanced reactors.

“We must jump-start a commercial-scale, domestic supply chain for HALEU,” said Kathryn Huff, assistant secretary for nuclear energy. “Acquiring these services in the United States will reduce reliance on Russia, create American jobs, and support U.S. climate and energy security goals.”

The HALEU Availability Program was authorized by the Energy Act of 2020 to ensure HALEU will be available to support civilian domestic research, development, demonstration, and commercial use. The Inflation Reduction Act of 2022 provided $700 million for the program. From those funds, $500 million is earmarked to help establish a sustainable commercial supply chain for HALEU. The program will prioritize environmental justice issues and “be responsive to President Biden's Justice40 Initiative,” according to the DOE.

The DOE’s notice of intent provides more information and explains that “initial sources of uranium to meet the requirements of the [program] could be existing DOE stockpiles of highly enriched uranium (HEU) that would be processed or downblended into HALEU.” Those activities are both outside of the proposed action and already “covered by separate existing or pending NEPA documentation.”

The private-sector HALEU supply chain that the draft RFPs are designed to build would help ensure that HALEU is available once DOE HEU stockpiles are depleted. As stated in the notice of intent, “As DOE stockpiles are depleted, production would need to be supplemented by or transition to commercially operated facilities. To accelerate development of a sustainable commercial HALEU supply capability, an initial public/private partnership is recommended to address the high-fidelity (high-confidence demand) HALEU market (e.g., fuel for demonstration reactors) plus a percentage of the projected commercial demand for power reactors.”

Divide and conquer: There are several steps along the way from mined uranium to reactor-ready HALEU fuel, and the RFPs split those front-end activities into two parts, loosely labeled enrichment and deconversion. The enrichment RFP includes mining and milling, conversion, enrichment (which may be performed at two separate locations), and storage of UF6. The deconversion RFP includes transportation of enriched UF6, deconversion to oxide and metal, and storage. Under both RFPs, the DOE may award one or multiple contracts.

The draft RFP for enrichment services defines the preferred source and location of the natural uranium and conversion services. Uranium mined and milled in the United States from mines with existing operating licenses is preferred, with uranium sourced in North America “next preferred.” Conversion services located in the United States are preferred (North America, once again, is “next preferred”) and may be provided by “new or restored capacity.” While these guidelines will permit potential contractors look to Canada for mining, milling, or conversion services, enrichment services are expected to be “U.S. only,” and there is “no preference” for existing or new enrichment capacity.

The draft RFP for deconversion services “encompasses transporting the HALEU UF6 stored at the enrichment facility(ies) to a deconversion facility(ies) (if not co-located with the enrichment facility), performing the deconversion process, and storing the deconverted material until there is a need to ship it to a fuel fabricator or other end user (if not co-located with the deconversion facility). All such deconversion and subsequent storage must occur in a physical location within the continental United States.”

Services provided under both RFPs could be co-located or housed at separate facilities. Deconversion services, for example, could be co-located with enrichment, with fuel fabrication, or with both, dramatically reducing transportation requirements.

Contracting details: Enrichment providers will bid for initial work under Contract Line-Item Number (CLIN) 1 on a firm fixed-price basis. CLIN 1 work will only include interim actions such as engineering studies, feasibility studies, and designs, as well as the submittal of permit applications, license applications, and/or license modifications. According to the enrichment RFP, “Work cannot proceed past CLIN 1 until DOE has completed its obligations under NEPA, including issuance of an Environmental Impact Statement Record of Decision to proceed with the action.”

Providers may submit bids on seven options for HALEU production, CLIN 2–8, which cover seven different amounts of HALEU supply that “may or may not be exercised” by the DOE within the 10-year contract term: 5, 10, 25, 50, 100, 125, and 145 metric tons of uranium. A potential provider’s firm fixed price per unit for each of CLIN 2–8 would receive an economic price adjustment each year based on “a percentage equal to the percentage change in the applicable Producer Price Index.” That PPI will be the Energy Information Administration’s total purchased (weighted average) price of the most recent year, as published in the Uranium Marketing Annual Report.

The enrichment RFP specifies that, in addition to the source location preferences described above, “the feed uranium for enrichment to HALEU UF6 must have been mined and converted, and not come from a source that was recycled or reprocessed. The HALEU UF6 enrichment production capacity used to supply DOE with HALEU UF6 under this contract shall not negatively impact the existing baseline uranium production capacity currently supplying the U.S. domestic nuclear industry.”

The deconversion RFP has a total contract ceiling of $100 million for all task orders cumulatively awarded and, like the enrichment RFP, has a performance period of 10 years. The RFP includes an extensive list of actions or services that will be expected from a provider, including deconversion services “within the continental U.S.” to convert UF6 to a metal, oxide, or other fuel fabrication feed material; obtaining NRC licenses, certifications, permits, and all other approvals necessary, including safeguards and security requirements; and coordinating “all aspects of transportation for HALEU from the enrichment site to the deconversion site in UF6 form including, but not limited to, the acquisition of shipping containers, route planning, route approvals, Department of Transportation permits, community engagement, emergency planning, scheduling, real time monitoring, lifting and handling, qualifications, licensing, and shipping.”

Scoping: The DOE’s HALEU Availability Program EIS will analyze commercial HALEU fuel production and acquisition by the DOE, as well as reasonable alternatives and the no action alternative. Activities addressed will include extraction and recovery of uranium ore (from domestic and/or foreign sources); conversion of the uranium ore into UF6; enrichment (possibly in up to three steps of up to 5 percent U-235, between 5 and less than 10 percent U-235; and between 10 to less than 20 weight percent U-235 in an NRC Category II facility); deconversion of UF6 to uranium oxide, metal, and potentially other forms; storage; DOE acquisition of HALEU; and transportation of uranium/HALEU between facilities.

The DOE is accepting public comments on its notice of intent and the scope of its environmental impact statement to analyze the proposed HALEU procurement from June 5 through July 20. Details on three virtual scoping meetings, all scheduled for June 21, are available online.

Written comments regarding the scope of the EIS may be sent to James Lovejoy, DOE EIS document manager, by mail, to U.S. Department of Energy, Idaho Operations Office, 1955 Fremont Avenue, MS 1235, Idaho Falls, Idaho 83415; or by email to HALEU-EIS@nuclear.energy.gov.


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