US SMR Developers Need Larger Fuel Deals to Avoid Domestic Supply Crunch.

The US Department of Energy has committed to supply high-assay low-enriched uranium to five demonstration small modular reactor projects. While this will help advance the development of these projects, industry experts say long-term purchases are necessary to build a domestic fuel supply chain. The US has limited production capacity for HALEU, with Russia being the largest global supplier, and the Biden administration has banned uranium imports from Russia following its invasion of Ukraine.

The U.S. Department of Energy (DOE) has taken a significant step towards advancing small modular reactor (SMR) technology by committing to supply high-assay low-enriched uranium (HALEU) to five demonstration projects. This move aims to accelerate the development of SMRs, which offer smaller capacities and land requirements than conventional nuclear plants, as well as increased efficiencies and longer operating cycles [1].

The DOE's allocation of HALEU to Westinghouse, Kairos Power, TerraPower, Radiant Industries, and TRISO-X will provide material for initial core loads, enabling these companies to build and demonstrate their SMR designs. The DOE selected these firms in April under a multi-billion dollar nuclear fuel availability program launched in 2020 [1].

However, industry experts emphasize that long-term purchases are essential to establish a robust domestic fuel supply chain. The U.S. currently has minimal production capacity for HALEU, with Russia being the largest global supplier. The Biden administration has banned uranium imports from Russia following its invasion of Ukraine, further exacerbating the supply chain challenge [1].

The DOE's allocation of HALEU to the five developers is a crucial first step, but it does not address the broader fuel availability needed for refueling and scaling up SMRs. According to Adam Stein, director of nuclear energy innovation at the Breakthrough Institute, "Broader fuel availability will be needed for refueling and larger scale-up. Lack of fuel availability to operate a reactor long-term is one concern potential buyers have right now" [1].

To mitigate these concerns, the DOE has awarded ten contracts to companies to provide enrichment services, helping establish and build out a domestic supply of HALEU and low-enriched uranium (LEU). The contracts, which offer a minimum of $2 million each, are part of a 10-year framework for DOE procurement [1].

The U.S. demand for HALEU could reach 50 metric tons per year by 2035, according to the DOE. Centrus Energy, currently the only U.S. maker of HALEU, has the capacity to produce 900 kilograms per year. To meet the growing demand, additional investments in the U.S. nuclear fuel supply chain are necessary [1].

Lucid Group, a leading electric vehicle (EV) manufacturer, has also taken steps to secure its supply chain by signing multi-year agreements with Graphite One and Syrah Resources for American-sourced natural graphite. These agreements, which will start in 2026 and 2028, aim to localize critical material supply chains, enhance U.S. manufacturing independence, and reduce the vehicle carbon footprint [2].

In conclusion, while the DOE's commitment to supply HALEU to SMR demonstration projects is a positive step, it is only one piece of the puzzle. Establishing a robust domestic fuel supply chain will require significant investments and strategic partnerships to ensure the long-term viability and growth of the U.S. nuclear industry.

References:
[1] https://www.reuters.com/business/energy/us-reactor-builders-need-bigger-fuel-deals-avoid-supply-crunch-2025-06-05/
[2] https://www.stocktitan.net/news/LCID/lucid-strengthens-us-supply-chain-with-new-graphite-material-supply-l1jgcvr6ujyj.html