US Bets Billions on Nuclear Energy to Revitalize Supply Chain
A $900 million contract for Centrus Energy is the first major step in a multi-billion dollar federal push to end reliance on foreign uranium and fuel next-generation reactors.
The U.S. government is injecting billions of dollars into its domestic nuclear fuel industry, launching a decisive campaign to reclaim energy independence and build the supply chain for a new generation of advanced reactors. The initiative’s first major move is a nearly billion-dollar contract with Centrus Energy Corp. (NYSE MKT: LEU) to pioneer the nation's commercial production of a specialized nuclear fuel.
The Department of Energy (DOE) awarded a subsidiary of Centrus a $900 million task order to establish commercial-scale production of High-Assay, Low-Enriched Uranium (HALEU) at its facility in Piketon, Ohio. This investment is a cornerstone of a broader, decade-long commitment by the DOE to invest $2.7 billion to restore America’s uranium enrichment capacity, signaling a robust and long-term federal strategy to overhaul the nuclear fuel cycle.
This strategic pivot, aimed squarely at reducing and ultimately eliminating reliance on enriched uranium from Russia, has sent ripples through the energy sector. Shares of Centrus Energy have seen a dramatic rise over the past year, climbing from a 52-week low of $49.40 to a high of $464.25, reflecting investor optimism in the company's central role in the new domestic nuclear landscape.
"This is the starting gun for the revitalization of the American nuclear fuel industry," said a sector analyst. "For decades, the front end of the fuel cycle has been outsourced. This level of government commitment is a game-changer that provides the certainty needed for long-term private investment."
The funding is a direct implementation of the ADVANCE (Accelerating Deployment of Versatile, Advanced Nuclear for Clean Energy) Act, a bipartisan piece of legislation signed into law last year. The act is designed to streamline licensing and support the deployment of advanced nuclear technologies that are widely seen as critical for achieving national climate and energy security goals.
HALEU fuel is essential for many of the advanced reactor designs currently under development. Unlike traditional Low-Enriched Uranium (LEU), which is enriched to contain 3-5% uranium-235, HALEU is enriched to between 5% and 20%. This allows for smaller, more efficient reactor designs, longer-lasting fuel, and less waste. Currently, Russia is the only country with a commercial-scale HALEU production capacity.
Under the DOE contract, Centrus will expand its Piketon facility with a new cascade of 96 advanced centrifuges, with a target to begin commercial operations in 2029. The project is expected to create hundreds of high-paying jobs and re-establish Ohio as a key hub in the global nuclear supply chain.
The government's actions provide a clear demand signal for the nascent advanced reactor industry, assuring developers that a domestic fuel source will be available. As the U.S. pushes to decarbonize its power grid and secure its energy future, the revival of its domestic nuclear fuel production marks a critical and closely watched development for the global energy market.