Inside the U.S. Nuclear Expansion Hub

Urenco USA and the Future of Nuclear Power in the United States

Urenco USA operates the only commercial uranium enrichment facility in the United States, playing a vital role in fueling the country's growing nuclear power industry. The facility, located in New Mexico, is set to become even more critical as the U.S. looks to expand its nuclear energy capacity in the coming decades. However, the nation faces a looming nuclear fuel supply gap due to its decision to ban Russian uranium from the marketplace in response to the war in Ukraine.

This shift has created a pressing need for increased domestic uranium enrichment. Urenco is currently working to expand its production capabilities to meet the rising demand from the nuclear fleet.

EUNICE, NEW MEXICO — Paul Lorskulsint was a shift manager at a brand new uranium enrichment facility deep in the American Southwest when disaster struck Japan in 2011. A massive tsunami and earthquake caused a severe accident at the Fukushima Daiichi Nuclear Power Plant. Thousands of miles away in Eunice, New Mexico, Lorskulsint turned on the television to ensure his team could witness the unfolding events across the Pacific Ocean.

Lorskulsint recognized that the Fukushima disaster marked a turning point for the nuclear industry. The plant where he was leading an operations shift had just opened in 2010, after Urenco spent years building the facility in anticipation of growing demand. Over the following decade, public support for nuclear power declined, and a dozen reactors closed in the U.S. as the industry struggled to compete against cheap natural gas and renewable energy. Demand for low enriched uranium dropped significantly.

"The price of what we sold basically went through the floor," Lorskulsint, now the chief nuclear officer at Urenco USA, told The News Pulse. Although long-term contracts with utilities helped insulate the facility during the downturn, the price drop forced expansion plans to be put on hold.

Headquartered outside London, Urenco is jointly owned by the British and Dutch governments and two German utilities. Its New Mexico facility is the only commercial enrichment facility left in the U.S. The last U.S.-owned commercial facility in Paducah, Kentucky, closed in 2013, and its owner, the United States Enrichment Corporation, went bankrupt during the downturn after Fukushima.

Fourteen years later, the situation has changed dramatically. Urenco USA is racing to expand its enrichment capacity as the nuclear industry gains momentum. Electricity demand in the U.S. is projected to surge due to artificial intelligence and the push to expand domestic manufacturing. However, concerns remain about whether U.S. power supplies will ramp up quickly enough to meet the growing needs. Increasing uranium enrichment will be a key part of this process, despite past challenges.

Additionally, U.S. enriched uranium supplies are at risk. In 2024, the U.S. still imported 20% of its enriched uranium from Russia, a legacy of the broken relationship between the two countries after the Cold War. The U.S. will completely ban the import of Russian uranium by 2028 in response to Moscow’s full-scale invasion of Ukraine, creating a significant supply deficit just as Washington, utilities, and the tech sector develop ambitious plans to build new reactors.

Nuclear plants like Palisades in Michigan, Crane Clean Energy Center in Pennsylvania, and Duane Arnold in Iowa are planning to restart operations this decade after closing years ago. The tech sector is investing hundreds of millions of dollars to bring advanced reactors online in the 2030s to power their computer warehouses that train and run AI applications.

"It is a pivotal moment, the next five to 10 years for the nuclear industry," Lorskulsint said. "We're going to have to deliver on time, on schedule, and continue to maintain that momentum, which is a significant challenge."

Expansion Plans

In deeply divided Washington, support for nuclear power is one of the few issues that can still garner bipartisan backing. President Donald Trump wants to quadruple nuclear power by 2050, a significant increase over President Joe Biden's previous goal to triple it by that date.

The U.S. has only built one new nuclear plant from scratch in the past 30 years, raising doubts about whether such ambitious plans can be realized. But any effort to expand nuclear power in the U.S., whether large or small, will go through Urenco's facility in New Mexico.

The plant currently has the capacity to supply about a third of U.S. demand, with $5 billion invested in the facility to date. Urenco is expanding its capacity in New Mexico by 15% through 2027 as utilities replace Russian fuel. It has installed two new centrifuge cascades for enrichment this year. However, Urenco's expansion alone won't fill the Russian supply gap, Lorskulsint said.

"Our competitors will have to expand in order to make sure that as a whole the industry is still supplied," he said. "We're building quickly as we can to make sure that the industry is not short-handed."

As Russian fuel is banned from the U.S., the Trump administration is pushing for 10 new large reactors to start construction this decade. Alphabet is investing in about 2 gigawatts of new nuclear, Amazon has committed to more than 5 gigawatts, and Meta wants to bring up to 4 gigawatts online.

The Industry's Concerns

The industry is worried about the supply gap, Lorskulsint said, but filling it "is not an insurmountable task." Urenco USA is a candidate to receive a contract from the Department of Energy to produce more low-enriched uranium, part of U.S. efforts to stand up a domestic nuclear supply chain. The contract would allow the New Mexico facility to expand further with the construction of a fourth production building.

Urenco's competitors are also seeking support from the Energy Department to build out U.S. enrichment capacity. France's Orano is planning to build a facility in Oak Ridge, Tennessee, with operations potentially starting in the 2030s. Publicly traded Centrus has a facility in Piketon, Ohio, where it plans to produce low-enriched uranium, but it hasn't yet started commercial operations. Centrus is the successor company to the United States Enrichment Corporation that went bankrupt in 2013.

Centrus stock has gained more than 400% this year as investors bet on a growing demand for enriched uranium due to U.S. plans to expand nuclear power.

Supply Chain Bottlenecks

But enrichment is just one stage in a long supply chain that will be stretched by growing demand. Uranium delivered to the U.S. is often mined in Canada and then converted into an intermediate state called uranium hexafluoride, which is the feedstock for enrichment.

The feedstock is spun in Urenco's centrifuges to increase the presence of the isotope Uranium-235 to 5%, the level needed for most nuclear plants. The enriched uranium is then shipped to fuel fabricators that manufacture the pellets that go into reactors in power plants.

U.S. nuclear plants are facing a cumulative supply gap of 184 million pounds of uranium through 2034, according to the Energy Information Administration. The biggest bottleneck right now for Urenco is the conversion of uranium into the feedstock for enrichment, Lorskulsint said. There are only three facilities in the Western world located in Canada, France, and Illinois that convert uranium into feedstock.

"Every portion of the supply chain is going to have to expand; it's not just about enrichment," Lorskulsint said. "We need more of everything, but conversion right now is the bottleneck."

The nuclear supply chain may not be the biggest challenge in the end, the executive said. The aging U.S. electric grid could prove to be the real constraint on building new nuclear due to how long it takes to complete upgrades, he said. While this could slow Urenco down, it won't stop the expansion, he said.

"We came here when the market demanded it," Lorskulsint said of Urenco's investment in the U.S. "We were here when the market didn't demand it. And we are now expanding to make sure that we can still support as much as the market needs from us."