Russia and U.S. nuclear fuel
In mid-May, the President signed into law a Russian uranium ban, which also unlocks funding for $2.72 billion to rebuild the U.S. nuclear fuel supply chain, and there is pending legislation on the Hill that would put in place a comprehensive ban on activities involving ROSATOM, Russia's state nuclear energy corporation.
Russia plays a dominant role in nuclear fuel. According to the U.S. Department of Energy, Russia has roughly 44% of the world’s uranium enrichment capacity and supplies approximately 35% of U.S. imports for nuclear fuel.
We walk through each of these recent developments—the Russian uranium ban and the proposed Rosatom Sanctions Enforcement Act—in more detail below.
On May 13, 2024, U.S. President Joe Biden signed into law H.R.1042, the Prohibiting Russian Uranium Imports Act, banning the import of low-enriched uranium (LEU) from Russia. The ban goes into effect on August 11, 2024. The Act was approved by the House of Representatives on December 11, 2023, and by the Senate on April 30, 2024.
Specifically, the Act amends Section 3112A of the USEC Privatization Act (42 USC 2297h-10a) to prohibit importing into the United States (1) unirradiated low-enriched uranium (LEU) that is produced in the Russian Federation or by a Russian entity, and (2) unirradiated LEU that is determined to have been exchanged with, swapped for, or otherwise obtained in lieu of unirradiated LEU produced in the Russian Federation or by a Russian entity in a manner designed to circumvent the import prohibition. The ban goes into effect 90 days after it was signed into law, in mid-August 2024.
DOE estimates that U.S. utilities have roughly three years of LEU available through existing inventory or pre-existing contracts. To ensure U.S. plants do not experience any disruptions, the ban allows for waivers to import from Russia through 2027 if the DOE determines that no alternative source of fuel for a US reactor is available. Any waiver by the Secretary will terminate not later than January 1, 2028. 42 U.S.C. 2297h–10a(d)(2)(C).
1. DOE outlines new waiver process for Russian LEU imports
To ensure U.S. nuclear power plants do not experience disruptions in fuel supplies, on May 24, DOE released a process detailing a waiver process for importing Russian LEU following enactment of the Russian uranium ban, which goes into effect on August 11, 2024. Under the ban, the Secretary of Energy, in consultation with the Secretaries of State and Commerce, can grant a waiver to an importer for specified quantities of Russian LEU if the Secretary of Energy determines that: (1) no alternative viable source of LEU is available to sustain the continued operation of a nuclear reactor or a U.S. nuclear energy company; or (2) the importation of Russian LEU is in the national interest. An import could be in the national interest if it meets one of the following criteria:
- The import is necessary to maintain the viability of a U.S. nuclear energy company that is critical to the U.S. nuclear energy fuel supply chain.
- The import is intended to support an existing arrangement to provide fuel for a nuclear power plant in another country and thus minimize the likelihood of that country seeking a non-U.S. fuel supplier.
- In the guidance, DOE notes that the “waiver…would likely be appropriate” for utilities that need the reactor fuel for near-term refueling to prevent gaps in operations and have made a good faith effort to find an alternative source.
Waivers will be granted for limited quantities of LEU, decreasing annually from 476,536 kg in 2024 to 459,083 kg in 2027, and will terminate by January 1, 2028. Notifications of granted waivers must be submitted to relevant Congressional committees.
In response to the ban, the press reported that Tenex, the Russian uranium supplier, issued force majeure notices to U.S. utilities, giving them 60 days to secure a waiver exempting them from the new law in order to resume nuclear fuel production to meet their contractual schedules.
2. Related Changes to NRC Regulations
In response to President Biden signing the law prohibiting Russian uranium imports, the NRC published a Federal Register notice (89 Fed. Reg. 45926) explaining changes to the NRC’s export/import regulations set forth in 10 CFR Part 110. Specifically, the notice details that after the statutory prohibition takes effect on August 11, 2024, the general license in 10 CFR 110.27 can no longer be used for imports that fall within the statutory prohibition, unless the importer obtains a waiver from DOE in accordance with the Act.
Additionally, the notice explains that specific licenses under 10 CFR Part 110 will not be available for imports that fall within the prohibition. If the NRC receives any applications for such specific licenses, including for cases where DOE has denied a waiver request or waivers are no longer available, the NRC states that it will return those applications without further action.
3. Funding for DOE Fuel Support Unlocked by Russian Uranium Ban
The passage of the uranium ban also unlocked $2.72 billion of funds that Congress recently authorized to rebuild the U.S. nuclear fuel supply chain, including LEU production (as set forth in the Nuclear Fuels Security Act of 2023 (S. 452)). $700 million of those funds are dedicated to high-assay low-enriched uranium (HALEU), a key source of fuel for the next generation of nuclear reactor. Notably, the total funds could not be used until the Russian uranium ban was implemented as set forth in the Section 312 of the Consolidated Appropriations Act, 2024 (H.R. 4366).
The overall funds stem from different pieces of legislation. For instance, the $2.72 billion to implement the Nuclear Fuel Security Act comes from the Consolidated Appropriations mentioned above. And the $700 million of the $2.72 billion, of which is dedicated to HALEU, comes from the Inflation Reduction Act and includes: $100 million to research, develop and demonstrate the commercial use of HALEU; $500 million to produce HALEU; and $100 million for financial assistance to design and license transportation packages for HALEU.
This funding, and the clarified need for a domestic fuel source for nuclear reactors aligns with DOE’s draft requests for proposals (RFP) issued first in June 2023 as two separate RFPs—one centered on enrichment and one for deconversion of the enriched uranium into metal, oxide, and other forms to be used as fuel for advanced reactors, and then DOE issued a final request for proposals (RFP) on January 9 for uranium enrichment services.
According to the January final RFP, DOE’s Office of Nuclear Energy plans to award one or more contracts to produce 10 metric tons of HALEU from domestic uranium enrichment capabilities. Once enriched, the HALEU material will be stored at the enrichment site as uranium hexafluoride gas until there is a need to ship it for deconversion. Under HALEU enrichment contracts resulting from this RFP, which have a maximum duration of 10 years, the government will assure each contractor a minimum order value of $2 million, to be fulfilled over the term of the contract. Enrichment and storage activities must occur in the continental United States and comply with the National Environmental Policy Act.
- “Rosatom Sanctions Enforcement Act” Pending on Hill
On May 16, the House Foreign Affairs Committee advanced the bipartisan Rosatom Sanctions Enforcement Act (H.R. 8046). H.R. 8046 has bipartisan support from both Republicans and Democrats, and is cosponsored by Rep. William Keating (D-MA), the ranking member of the Europe subcommittee. The bill passed in committee and was reported favorably to the House of Representatives, by a 37-2 vote.
This bill seeks to impose sanctions targeting Russian state-owned nuclear energy corporation Rosatom and its subsidiaries. Specifically, the bill aims to: (1) effect a decoupling from the Russian nuclear industry until certain conditions are met; (2) replace Rosatom and other nuclear suppliers of the Russian Federation with those from the United States and United States allies and partners; and (3) replace Rosatom as the primary entity that can provide reactor safety and operation services to the existing Rosatom and Russian Federation designed and constructed reactor fleet.
- It would direct the President to impose sanctions on (1) Rosatom; (2) a foreign person that knowingly directly or indirectly engages in any significant transaction for nuclear reactor construction and related services with Rosatom; and (3) any foreign person that is a member of the supervisory board or management board of Rosatom; and (4) any foreign person that is responsible or complicit in, or responsible for ordering, controlling or otherwise directing the activities at Ukraine’s Zaporizhzhia Nuclear Power Plant; or (5) any foreign person that is owned, controlled, or directed by, or has knowingly provided support for or acted or purported to act for or on behalf of any person described in (1), (2), (3), or (4).
- The president may grant waivers—for a categorical basis for renewable periods of 180 days up to Jan. 1, 2028, and then on a case-by-case basis for periods of 180 days.
- The President is not required to imposes sanctions if the foreign person has provided reliable assurances that it won’t reinitiate activities it had undertaken or it will continue to make progress toward terminating such activities—and this exception may apply to contracts that have entered into force before Feb. 24, 2022 and not extended/renegotiated; and do not extend past Jan. 1, 2028 for fuel and services.
The President may waive the application of sanctions for a transaction or transactions with a United States person, a foreign person, or a foreign financial institution if the President certifies to the appropriate congressional committees that such waiver is vital to the national security interests of the U.S.—(A) for renewable periods of 180 days until January 1, 2028; and (B) on a case-by-case-basis from January 1, 2028 to January 1, 2032. These waivers may be for one year renewable up to 10 years if:
- The President determines that the transaction relates to activities necessary to the production of medical isotopes or industrial isotopes; and
- The President certifies to the appropriate congressional committees that— (I) domestic medical isotope or industrial isotope production is insufficient to meet United States patient and industry requirements; and (II) the United States is taking measurable steps to establish medical isotope or industrial isotope supply chains that are not reliant on Rosatom or other Russian source material.
Despite the current political divisions in Congress and a looming presidential election, causing significantly fewer bills to reach President Biden’s desk in the 118th Session, members from both chambers have shown significant bipartisan support and resolve to pass nuclear-related legislation, especially those pushing for less dependence on Russia for nuclear fuel and energy resources.
The Rosatom Sanctions Enforcement Act is riding on the momentum of the recently passed Prohibiting Russian Uranium Imports Act and vigorous efforts to pass a revised Accelerating Deployment of Versatile, Advanced Nuclear for Clean Energy (ADVANCE) Act this month.
This 118th Congress has a small window of time left on the legislative calendar, causing the Congressional Leadership to focus on passing the few remaining “must-pass” bills, such as the expiring Farm Bill, FY2025 appropriations bills, and the FY2025 National Defense Authorization Act (NDAA). For moving this bill forward, attaching the bill as an amendment to the NDAA (H.R. 8070) would be a logical and likely way for H.R. 8046 to pass this Congress.
ADVANCE Act moving forward on the Hill
The U.S. further demonstrates its intent to support boosting its own nuclear industry innovation and advanced reactors. On June 13, the Senate announced that the Accelerating Deployment of Versatile, Advanced Nuclear for Clean Energy Act—commonly known as the ADVANCE Act, is slated for a vote in the Senate as early as next week.
The general purpose of the ADVANCE Act is to support the deployment of U.S. advanced reactors both domestically and overseas. It includes a number of provisions aimed at the U.S. Nuclear Regulatory Commission’s (“NRC” or “Commission”) licensing process; strengthening the workforce at the NRC; and updating the NRC’s export authority and processes. The Act would also amend the Atomic Energy Act to ensure fusion facilities continue to be regulated under a radioactive materials licensing framework, which aligns with an earlier NRC determination.
The text of the ADVANCE Act is summarized is a previous blog. The ADVANCE Act passed in the House as part of the Fire Grants and Safety Act (S. 870), by a vote of 393-13, on May 8, 2024. Now, an impending vote in the Senate brings the nuclear package that much closer to the President’s desk for signature.
