Fuel Shortage May Impede the Revival of Nuclear Power in the U.S.

Rising U.S. Nuclear Power Ambitions Face Fuel Supply Challenges

As the United States aims to dramatically increase its nuclear power generation—targeting a fourfold boost by 2050—and prepares for a ban on Russian nuclear fuel imports, concerns are mounting over potential bottlenecks in the nuclear fuel supply chain. Centrus Energy, a leading U.S. enrichment company, warns that these factors could create a significant supply gap.

Expanding Domestic Enrichment Capacity

American nuclear fuel suppliers, including Centrus Energy and other major Western firms, are working to ramp up enrichment capabilities within the U.S. However, Centrus CEO Amir Vexler notes that until these new facilities are operational, likely not until the early 2030s, the country may experience a shortage of nuclear fuel.

Is a Supply Shortfall Looming?

Vexler expressed to the Financial Times that the current market already faces a mismatch between supply and demand for nuclear fuel, even for existing reactors. He anticipates ongoing strain until substantial new enrichment capacity becomes available in the next decade.

Should enriched uranium become scarce, it could hinder the U.S. Administration’s vision to spark a new era of nuclear energy, which includes increasing nuclear capacity from around 100 GW today to 400 GW by mid-century.

Despite these challenges, Centrus and other Western suppliers are investing heavily in new enrichment projects, especially in the U.S., to meet surging electricity demand driven by the growth of AI and data centers.

Major Investments in U.S. Enrichment

Centrus Energy has approved a multi-billion-dollar expansion of its uranium enrichment facility in Piketon, Ohio. This initiative will boost production of Low-Enriched Uranium (LEU) to fulfill a $2.3 billion backlog and rising demand from operating reactors. The company also plans to add capacity for 12 metric tons of High-Assay, Low-Enriched Uranium (HALEU) annually, targeting next-generation reactors.

In December 2025, Centrus began manufacturing centrifuges to support this expansion. By early 2026, the Department of Energy (DOE) awarded Centrus a $900 million contract for HALEU production. Other recipients of $900 million DOE awards include American Centrifuge Operating and Orano Federal Services, the U.S. branch of French nuclear giant Orano.

Orano and Urenco Expand U.S. Presence

Orano is planning to build a new enrichment plant in Oak Ridge, Tennessee. According to the company, this facility will help U.S. nuclear operators comply with regulations banning Russian uranium imports starting in 2028. The plant is also designed to meet the growing energy needs of U.S. utilities, especially as AI and data centers drive demand for stable, affordable, and low-carbon electricity.

Following the DOE’s $900 million funding, Orano will proceed with the next phases of the project, which is expected to cost $5 billion. This includes submitting a license application to the U.S. Nuclear Regulatory Commission in the first half of 2026.

Currently, only Centrus and Urenco—a consortium formed by Germany, the Netherlands, and the UK—are licensed to enrich uranium in the U.S. In 2025, Urenco USA began producing low-enriched uranium with a second cascade of gas centrifuges at its New Mexico facility. By 2027, Urenco will add 700,000 separative work units (SWU) of capacity, increasing the plant’s output by 15%. The company says it can currently supply about one-third of the enrichment needs for U.S. commercial nuclear plants and that its expansion will help reduce reliance on Russian sources.

How Quickly Can Capacity Grow?

Despite robust investment and government backing, industry experts caution that a supply gap may persist until new domestic enrichment plants are fully operational in the early 2030s. Jean-Luc Palayer, CEO of Orano USA, told the Wall Street Journal that achieving the U.S. goal of 400 GW nuclear capacity by 2050 would require a twelvefold increase in uranium enrichment if all fuel is sourced domestically. He emphasized the urgency for the U.S. to expand and diversify its enrichment infrastructure.

Significant growth in enrichment capacity is essential for nuclear energy to meet the nation’s rising power needs in the coming years. The U.S. Energy Information Administration (EIA) projects that U.S. electricity consumption will rise by 1% this year and 3% in 2027—the first four-year streak of growth since 2007 and the strongest since 2000, fueled by the expansion of large-scale computing centers.

If nuclear fuel supply can keep pace, nuclear power could play a much larger role in meeting America’s growing electricity demand.

Canadian uranium producer NexGen Energy anticipates that major technology companies will increasingly support new uranium mining ventures to secure the reliable power needed for their expanding data centers.

By Tsvetana Paraskova for Oilprice.com

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