Calm Ground, Incentives Sweeten Deal

Dec. 21, 2004
USEC Inc.'s uranium enrichment plant finds a home in Ohio.

It's not often that seis- mic factors play a role in where a manufacturing plant is located, but that was the case with Bethesda, Md.-based USEC Inc.'s American Centrifuge uranium enrichment plant. The cities of Piketon, Ohio, and Paducah, Ky., were vying for rights to the plant. Ultimately, the decision to locate in Piketon, which is 63 miles south of Columbus, was based on several factors including scheduling -- existing buildings and infrastructure in Piketon, specifically the former Portsmouth Gaseous Diffusion Plant, enabled USEC to accelerate deployment of the American Centrifuge Commercial Plant; seismic factors -- Paducah's proximity to seismic faults increased risks and costs; and financial perks -- economic incentives by the state and local community sweetened the deal. Indeed, according to Ohio State Development Director Bruce Johnson, the Ohio Department of Development offered USEC $100 million in incentives for the project. The incentives include grants, a loan, a bond and tax credits and exemptions. According to Johnson, the state of Ohio "very aggressively went after the project. The governor made personal pitches, but what it came down to was how USEC assessed the environment and labor." To be sure, in addition to the monetary incentives, the community rallied around the project. "A lot of credit goes to the workers and local community," says Johnson. They sent thousands of letters of support for bringing the company to Ohio. "We were fortunate to have had the option of two first-class sites and workforces in Piketon and Paducah," says William H. Timbers, president and CEO of USEC. "The Ohio proposal offered the right mix of economic benefits, existing infrastructure, assurances concerning seismic conditions and schedule advantage for this important new facility." Timbers also notes that the fact that the Department of Energy built and operated gas centrifuges at the Portsmouth Gaseous Diffusion Plant made it a win-win in terms of labor. Adds Johnson, the Piketon community has highly skilled workers ripe for the kind of work USEC will offer. "These people have been working in this industry for a long time, they understand nuclear work, and they understand the risks and are well versed in the risks," Johnson says. Once completed -- USEC anticipates the facility will be operational in 2010 -- the plant, which is expected to cost up to $1.5 billion, will employ 500 people and reach an initial production level of 3.5 million separative work units (SWU), a unit of measurement that pertains to the process of enriching uranium so it can be used as fuel for nuclear power plants.

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