The U.S. Department of Energy has allocated $2.7 billion to developing a supply chain for nuclear reactor fuel. The department announced contracts for three reactor fuel companies on Monday in an effort to undercut Russia’s dominance in the market for advanced reactor fuel.
The funding comes as electricity demand increases and federal policy shifts away from renewable energy development. The Trump administration is betting on a larger role for nuclear power in America’s energy future. But the U.S. relies heavily on imported fuel for its existing nuclear power plants, according to data from the U.S. Energy Information Administration.
In a press release, Energy Secretary Chris Wright said the administration is “committed to restoring a secure domestic nuclear fuel supply chain capable of producing the nuclear fuels needed to power the reactors of today and the advanced reactors of tomorrow.”
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What will the nuclear fuel be used for?
The Energy Department’s awards focus on two types of nuclear fuel: low-enriched uranium (LEU) and high-assay low-enriched uranium (HALEU). Both are produced by enriching natural uranium to increase concentrations of uranium-235, the isotope that sustains fission reactions underpinning nuclear power plants. LEU powers the large commercial reactors currently operating in the United States. HALEU contains higher concentrations, enabling more efficient reactor designs such as small modular reactors.
Advanced reactors using HALEU can operate at higher temperatures than those at conventional plants, potentially improving efficiency and reducing waste. Many advanced designs are also smaller and more flexible, allowing deployment at remote communities, military bases and industrial facilities.
The HALEU enrichment effort is separate from another Trump administration initiative to make plutonium from decommissioned nuclear warheads available to the power industry. That plutonium would be used in conventional reactors, while HALEU is specifically designed for advanced reactor technologies.
While one U.S. company has produced HALEU, it’s not available at a commercial scale. Russia’s state-owned nuclear company Rosatom is one of the few sources of commercial HALEU supply, creating a dependency that Congress sought to address with a 2024 ban on Russian uranium imports.
How is the $2.7 billion distributed?
The Energy Department awarded $900 million each to three companies operating in the United States.
American Centrifuge Operating, a subsidiary of Centrus Energy, will develop domestic HALEU enrichment capacity at its facility in Piketon, Ohio. Centrus began producing HALEU in October 2023 under a previous department contract, becoming the only domestic source of the fuel.
General Matter will develop HALEU production using laser-based enrichment technology. The approach uses precise light frequencies to selectively excite and separate uranium isotopes.
Orano Federal Services will expand domestic LEU enrichment. Orano Federal Services is the U.S. subsidiary of France’s state-owned Orano Group. The company plans to build a new $5 billion enrichment facility in Oak Ridge, Tennessee.
Wright said the awards would be “distributed to the companies under a strict milestone approach,” requiring them to meet benchmarks before receiving payments.
