What exactly does the Areva suspension mean for Idaho?

13 Dec

Areva's abrupt suspension of Idaho Falls operations could have several implications for the future of the Eagle Rock Enrichment Plant.

by Jamie Hale

Idaho Falls was hit hard today with the news that Areva, a French nuclear power company, will suspend work on the planned $3 billion enrichment plant just outside the city. The decision means a lot of different things to a lot of different people, but how exactly does it affect Idaho? To look at the future between Areva and Idaho, you first have to take a look at the past.

The France-based company selected Idaho as the location for it’s new uranium enrichment plant back in July 2008. Lucrative tax incentives totaling $400 million helped persuade Areva to move north from their other choice of real estate in New Mexico. The proposed plant was to be built 18 miles outside Idaho Falls, and would employ 1,000 workers during construction (then slated to start in 2011) as well as 250 engineers and technicians once the facility was up and running.

In May 2010, the project got a shot in the arm when the U.S. Department of Energy offered a $2 billion loan guarantee after determining that the plant would be a key step in generating CO2-free nuclear energy. The money continued to pour in when the Idaho Departments of Labor and Commerce offered up $750,000 to build a new overpass on Highway 20 near the proposed site, based largely on the company’s promise to create 250 jobs with the project.

But the seemingly easy-going project wasn’t without plenty of controversy, of course. At an August 2010 public hearing, hundreds of people showed up from both sides of the argument. While most people showed up in support of Areva, representatives from the Snake River Alliance argued that the project would result in tons of nuclear waste each year, which could stay in Idaho. The United States National Regulatory Commission said, after an environmental impact study, that the effects would be minor, but the Snake River Alliance pursued.

Despite the opposition, the Nuclear Regulatory Commission approved a license for the so-called Eagle Rock Enrichment Facility in October 2011, pushing the construction start date to spring of 2012. By October, the number of estimated jobs the plant would create jumped to 1,400 for construction and 400 for operations.

Although Areva’s Idaho operations went smoothly, the corporation suffered from the Fukushima nuclear disaster in Japan, in the wake of the devastating tsunami earlier this year. As a result, Areva announced today that they will suspend production of the Idaho Falls plant in an attempt to get their heads back above water.

So what exactly will this mean for Idaho Falls? Well it means a few different things:

Over 1,000 local and regional construction workers won’t get those jobs this year
This is maybe the most distressing point of all, as the plant was set to employ (albeit temporarily) about 1,400 construction workers to build the facility–that’s a big number. With the suspension, we’re looking at over 1,000 people who will go without income they probably need very desperately.

The bright side? Idaho Gov. Butch Otter announced today that Areva plans on keeping 300 engineering, design and planning jobs already in place through 2012. Those workers can just hope 2012 is a better year for the energy company.

The Eagle Rock Enrichment Plant seems to be on indefinite hiatus
Areva said they will be suspending production, but they didn’t say when that suspension will be lifted. We didn’t even get so much as a “maybe in a few years” from them. This seems to imply that the company really doesn’t know when, or more importantly, if they’ll be able to actually build this thing. The losses from the Japan disaster totaled about $2.65 billion, about the price of the entire Eagle Rock plant.

The company is, however, the world’s leading nuclear energy company and it’s hard to imagine them failing completely unless nuclear energy fails completely. Although some countries have decided to part ways with nuclear, America seems very much unopposed. If Idaho is the ideal place in the U.S. for nuclear and America is on board with it, Areva will probably come back around to Eagle Rock.

The Snake River Alliance has won a small victory–and time to win a larger one
Areva’s biggest local competition, The Snake River Alliance, was gloating pretty hard on today’s news. “Areva’s decision was inevitable,” wrote alliance Executive Director Liz Woodruff on the group’s website. “It’s regrettable that the state, Bonneville County and the city of Idaho Falls have invested so much in a project that is doomed to failure, but it’s better that the project be stopped now rather than later.”

The suspension has now bought the group more time to garner support. During all those hearings, their biggest hindrance was a lack of opposition from Americans. Nuclear power isn’t seen as so bad, especially if it means nearly 2,000 new jobs, but if something like another Fukushima happens before Areva gets back on their feet, America’s tune could change and suddenly the country’s newest uranium enrichment plant could be a target for environmentalists nationally.

What all this comes down to is the fact that nobody really knows what’s going to happen with the Idaho Falls plant. In reality, it’s probably going to be built whenever Areva gets a better footing, but natural disasters, as well as America’s ever-changing political battles, can be nearly impossible to predict.

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Trackbacks/Pingbacks

  1. [Morning Briefs] A Shooting, A Fire and Another Areva Suspension « TBA - 02/28/2012

    […] on their Idaho Falls enrichment plant, throwing their future in the region into even further doubt. Back in December, the company suspended work on the Eagle Rock Enrichment Facility, but now that suspension has been […]

  2. [Morning Briefs] A Shooting, A Fire and Another Areva Suspension - 03/16/2012

    […] on their Idaho Falls enrichment plant, throwing their future in the region into even further doubt. Back in December, the company suspended work on the Eagle Rock Enrichment Facility, but now that suspension has been […]

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