William J. Weida

The Colorado College

June 17, 2025

Nuclear reactor fuel fabricated from plutonium oxide is called mixed oxide fuel (MOX). Building a MOX facility will not create jobs for workers laid off at Pantex during the drawdowns proposed for the 1998-2002 period. Those drawdowns will be over before the six-year construction period of a MOX facility would begin, and it is unlikely that laid-off Pantex workers would be hired as construction workers.

Even though a MOX facility would do nothing for the existing Pantex work force, the Amarillo business community was predictably supportive of MOX fabrication at the recent hearings in Amarillo. However, in spite of the money, time and effort spent to secure this plant, a MOX facility is unlikely to be built in Amarillo--or anywhere else--because the use of surplus weapon-grade plutonium as commercial reactor fuel is simply too expensive and requires too many subsidies.

Nuclear power reactors operate for profit, so costs must be kept as low as possible. However, MOX costs much more than regular low enriched uranium (LEU) reactor fuel even though it generates no more power than LEU. Even the Energy Department claims that "in no case can MOX fuel compete economically with LEU fuel." Given this unfavorable cost difference, no commercial reactor operator would willingly accept MOX unless it received subsidies sufficient to compensate for the losses incurred by using MOX.

MOX has one redeeming attribute--it is the perfect instrument for delivering subsidies to nuclear reactor operators. When DOE requested "expressions of interest...regarding the future potential use of mixed oxide fuel from surplus weapons plutonium," a number of utilities gave positive responses predicated on the prospect of free MOX fuel and on additional, continuing subsidies from the US government. In return for a utility’s agreement to use mixed oxide fuel, DOE estimated it would have to provide approximately $825 million in operations subsidies per reactor through 2024. The greatest cost borne by the Energy Department was a waiver of the utilities' contribution to the Nuclear Waste Fund, a sum equal to $310 million per reactor.

Once DOE commits to subsidies to reactor operations, other subsidies will quickly follow. Figures provided by the Energy Department show total life cycle costs of all the different subsidies necessary to encourage the use of MOX fuel in existing light water reactors could be between $2.7 billion and $4.4 billion.

Proponents of MOX claim it will become economically viable when the price of uranium increases. This misses the economic point that mixed oxide fuel will become economically viable only when it can successfully compete with all other energy sources. If the price of uranium reactor fuel rises and it becomes less competitive with other energy sources, the subsidy provided to the mixed oxide fuel user must cover not only the difference between the price of the uranium fuel and the price of MOX, but also the difference between the price of uranium fuel and the price of the most economically competitive energy source.

If such a subsidy was actually delivered to a nuclear power producer, it could potentially make MOX burning economically viable in a market where no form of nuclear energy is competitive. As a result, the subsidies proposed for mixed oxide fuel users have the potential to "save" nuclear power producers who cannot compete in a deregulated environment.

In a July, 1996 report on surplus weapons-usable plutonium disposition, DOE included no subsidy calculations and noted that this created "a significant...uncertainty" in its cost estimates. ‘Cost uncertainties’ arise when a government agency like the Energy Department intervenes in the operation of a market because of:

There is no question that this nation must soon make some hard decisions concerning the surplus weapon-grade plutonium now accumulating as nuclear warheads are dismantled. However, there are cheaper and safer ways--such as vitrification--to dispose of surplus plutonium. And while we try to deal with our plutonium problems, let’s keep focused on the fact that an efficient energy sector will be a critical determinant of the future competitiveness of this nation. Either giving an energy provider preferential subsidies or creating jobs in Amarillo by building a facility that necessitates these subsidies subverts competition and has the potential to greatly harm the viability of the US energy sector. Congress is likely to agree that this hardly seems like an appropriate mission for the Department of Energy or a worthy goal for an economic development project.