If EnergySolutions gets the $9.5 billion contract at the Ohio and Kentucky plants, the Utah nuclear service company also plans to buy the Maryland-based company that now leases and operates those sites, according to Rep. John Dingell, D-Mich.
For EnergySolutions, the deal could be a boon, guaranteeing $700 million a year in business from the U.S. Energy Department and giving the company leverage for still more expansion. The company, which has been growing exponentially since 2005, would also further the stated goal of its chief executive officer, Steve Creamer, to dominate the U.S. nuclear services industry.
But the deal might not be in the best interests of taxpayers, says Dingell and fellow Michigan Democrat Bart Stupak, who leads the Subcommittee on Oversight and Investigations.
"Awarding a $9.5 billion contract on a non-competitive basis is deeply troubling since there are numerous qualified firms who could compete for this work," the two said in a Wednesday letter to Energy Secretary Samuel Bodman.
"How can DOE assess if taxpayers are receiving the best price for [decontamination and decommission- ing]?" the letter continues. "Moreover, what is the urgency of awarding a contract for D&D at Paducah, Kentucky, when the plant is still operating and there are no specific plans for its closure?"
The Michigan lawmakers suggest the contract may be a way for the federal government to subsidize EnergySolutions' takeover of the U.S. Enrichment Corp. (USEC), which Dingell accuses of mismanagement and seeking a government bailout. The congressmen have asked the Energy Department to respond to their questions to the DOE by Aug. 10.
The Energy Department acknowledges that EnergySolutions has made an unsolicited bid for work at the enrichment facilities but will say no more.
"DOE has received materials containing confidential and business proprietary information from EnergySolutions," said agency spokeswoman Megan Barnett. "However DOE has made no decision to award any contract to EnergySolutions based on the materials received."
EnergySolutions spokesman Mark Walker declined comment about the reports of a possible purchase of USEC.
The questions arise as EnergySolutions is seeking to go public and as the U.S. Justice Department is looking into allegations that EnergySolutions is using anti-competitive practices.
The U.S. Securities and Exchange Commission since March has been reviewing EnergySolutions' request to issue $500 million in stock so the funds can be used to help pay off what is owed to employees and to repay outstanding debt of more than $764 million, according to SEC documents.
The company is best-known in Utah for owning and operating a mile-square radioactive and hazardous waste landfill about 80 miles west of Salt Lake City.
The landfill gives the Utah company enormous leverage over commercial radioactive waste disposal throughout the United States.
Of the two other radioactive landfills, only one is open to commercial radioactive waste from 39 states and that one is also owned by EnergySolutions.
In its push to lead the U.S. market in all aspects of nuclear waste management, the company has expanded into new business lines, including cleanup and nuclear decontamination and decommissioning.
On Monday, the Energy Department announced that a consortium led by EnergySolutions is one of four that will receive up to $16 million for the Global Nuclear Energy Partnership, a program exploring the resumption of nuclear waste reprocessing in the United States.
Earlier this year, the Energy Department awarded the Utah company a $98.4 million, four-year contract for removing 16 million tons of uranium tailings and contaminated soil from the banks of the Colorado River near Moab and disposing it at a soon-to-be-created disposal site at Crescent Junction.
fahys@sltrib.com
