The Department for Energy Security and Net Zero says the new facility will be built at Urenco's Capenhurst site in northwest England, will support around 400 jobs and "will put an end to Russia's reign as the only commercial producer" of HALEU fuel in Europe.
HALEU - uranium enriched to between 5% and 20% uranium-235 - will be used in the advanced nuclear fuel required for most of the next-generation reactor designs currently under development. At present, only Russia and China have the infrastructure to produce HALEU at scale. The first advanced reactors are scheduled to be operational in the early 2030s.
UK Prime Minister Rishi Sunak said that building the uranium enrichment plant was essential for guaranteeing the country's nuclear and energy security.
Urenco CEO Boris Schucht said: "The responsibility the nuclear industry has to help governments and customers to achieve climate change and energy security goals is clear. We welcome this government investment, which will help accelerate the development of a civil HALEU commercial market and in turn the development of the next generation of nuclear power plants. These plants will have even higher safety standards and lend themselves to quicker licensing and construction processes."
The GBP195 million funding is part of the GBP300 million HALEU programme announced in January, with the energy department saying that the remaining funding would be allocated later this year to other parts of the programme including to support deconversion capability (converting the enriched uranium into a form to be made into fuel).
Tom Greatrex, Chief Executive of the Nuclear Industry Association, said: "This investment will enable the UK to fuel advanced reactors around the world, building on our existing capabilities to strengthen energy security for our allies."
Zara Hodgson, Director of the Dalton Nuclear Institute, which is also based in the northwest of England, said: "This is the biggest single investment in UK nuclear fuel production capability in decades, and it is especially welcome as it will accelerate the supply of the next generation of fuels that are vital for this new net zero nuclear era. Urenco Capenhurst's HALEU Enrichment capability will help hugely to unlock the deliverability of advanced nuclear projects, opening the door to sustainable electricity and heat for industries from nuclear, across the UK and overseas. We look now towards to how we can support this important project through training and innovation."
The USA is also developing a domestic supply of HALEU. In November last year, Centrus Energy delivered the first HALEU produced at its American Centrifuge Plant in Piketon, Ohio, to the US Department of Energy (DOE). Construction of the 16-centrifuge demonstration cascade plant began in 2019, under contract with the DOE. The delivery by Centrus of more than 20 kilograms of HALEU to the DOE means that phase one of the contract has now been completed and Centrus can move ahead with the second phase: a full year of HALEU production at the 900 kilograms per year plant.
In September, Orano revealed plans to extend enrichment capacity at its Georges Besse II (GB-II) uranium enrichment plant in France, and said it had begun the regulatory process to produce HALEU there.
Urenco is one third owned by the UK government, one third by the Dutch government and one third by two German utilities, E.ON S.E. and RWE AG.
