The United States Enrichment Corporation (USEC) released its third quarter results on November 4, reporting a net loss of $44.3 million, the fourth quarter in a row the company has reported a loss. USEC further conceded that the future of its American Centrifuge Project (ACP) was in doubt, stating: “we do not believe that our plans for ACP commercialization are economically viable without additional government support.” 

This has been a familiar refrain from the company. USEC has recorded ten unprofitable quarters out of the last twelve. It has now announced that its signature research, development, and demonstration (RD&D) program is not currently economically viable. Nevertheless, the Department of Energy (DOE) has agreed to hand over $13.6 million more of taxpayer money, in addition to the $227.7 million the DOE has already spent on federal subsidies to USEC in the last 15 months. The new money won’t be enough to complete the project, and the company may scrap it altogether.

Investors’ reaction to USEC’s third quarter results was predictable: USEC stock (NYSE:USU) lost more than 20 percent of its value in the first day of trading after the company’s announcement.  The New York Stock Exchange (NYSE) had already threatened to delist the company because of the stock’s poor performance. Delisting would eliminate any hope USEC has of raising money from new investors. USEC currently does not have the means to repay the $530 million it’s already borrowed from private investors.

In June 2012, DOE signed a cost-sharing agreement with USEC for work on the ACP through December 2013, specifying that the DOE would “share” 80 percent of the expected $350 million costs. The ACP was intended to demonstrate that USEC’s new centrifuge technology is viable before it spends billions more (that it would need to borrow) to construct a new facility. In May, USEC announced that it would be closing its only other uranium enrichment facility in Paducah, Kentucky.    

In such dire straits, the company notes, there’s only one source of funding that could bail them out: taxpayers. The company doesn’t have any financing lined up after the current government money stops in December, though it still needs significant financing before the ACP is ready for commercial deployment. USEC has spent $1.21 million lobbying Congress this year, pleading for more money. It’s time for the DOE and Congress to finally say no and end the continuous stream of subsidies to a failed company.