Column: Trump 2.0 won’t reverse Biden’s critical minerals push
Donald Trump has described the Inflation Reduction Act (IRA) as a "green scam" and vowed to repeal it after he returns to the White House in January.
The U.S. Commerce Department has recommended the White House take steps to protect the domestic production of uranium after finding the nation’s reliance on imports was a national security risk, said three people briefed on the matter.
The U.S. uranium industry produced roughly 700,000 pounds in 2018
Among the trade remedies recommended is to require nuclear power plants to purchase a minimum of 5% of the radioactive fuel from U.S. mines, said the people, who requested anonymity to discuss non-public deliberations. Two of the people said an option under consideration would see the quota escalate by 5 percentage points a year.
A decision to impose the quotas would be a boon to the two small mining companies that petitioned the Commerce Department to take action, Energy Fuels Inc. and Ur-Energy Inc. The move would increase costs for nuclear reactor operators that are already struggling in the face of competition from cheaper sources of power generated by natural gas and renewables.
Domestic nuclear providers rose on the news, with Uranium Energy Corp. up as much as 3.9%, Energy Fuels rising as much as 3.5% and Ur-Energy paring earlier losses to rise less than 1%.
The Commerce Department concluded in April that the imports harmed national security, delivering a confidential report on the matter to the White House at the time, the people said.
The White House didn’t immediately respond to a request for comment. A spokeswoman for the Commerce Department declined to comment on the contents of the uranium report and said it is at the White House.
The recommendations have yet to be presented to President Donald Trump, and a meeting on the matter between him and advisers on the issue that had been scheduled for Thursday was delayed, two people said.
The matter is far from final, but one person said it is certain that the White House appears poised to take action. Other options being considered include doing nothing or putting limits on uranium from specific countries, one of the people said.
Canadian Prime Minister Justin Trudeau, who met with Trump on Thursday, was expected to make the case against import quotas on uranium, which his country produces.
The Trump administration was asked by the two domestic uranium producers to impose a 25% domestic market quota on the grounds imports of uranium are a threat to national security.
A finding that the imports of uranium are harming U.S. national security gives Trump wide latitude to impose a trade remedy of his choosing — or do nothing at all — using the same trade law the administration has successfully used to slap tariffs on steel and aluminum imports.
While the domestic uranium producers, both of which are based in Colorado, initially asked the administration for a 25% quota, a lower amount could be a compromise that he utilities and the producers could live with, analysts have said.
Nuclear utilities, which have estimated a 25% quota could cost them as much as $800 million annually, remain hopeful Trump will decide against any trade action.
“President Trump is a longstanding champion for the U.S. nuclear industry, rightly recognizing the enormous economic and energy benefits that U.S. nuclear power delivers to American consumers,” said the Ad Hoc Utilities Group, which counts Exelon Corp., Duke Energy Corp., and Dominion Energy Inc. as members. “The U.S. nuclear industry supports 100,000 jobs while the two petitioners support a total of 150 jobs.”
Currently, the nuclear power industry gets nearly all of its uranium from sources such as Australia, Canada, Kazakhstan, and Russia.
The U.S. uranium industry produced roughly 700,000 pounds in 2018, according to Chris Gadomski, a nuclear industry analyst at Bloomberg New Energy Finance. A 5% quota would translate to between 2 million and 2.5 million pounds, he said.
The two miners who petitioned for the case have already begun expanding their mines in anticipation of a favorable decision.
Executives from both companies said in a statement they were pleased “the administration continues to recognize the unique national, energy and economic security role of domestic uranium production.”
“We continue to believe that reserving 25% of domestic demand for U.S. uranium is the most effective tool for sustaining domestic production of this critical mineral,” they said.
(By Ari Natter and Jenny Leonard)
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