The World Bank is being urged by its main shareholder to reconsider its long-standing ban on funding nuclear power projects. This push aims to enhance Western competitiveness against China and Russia in the nuclear energy sector.
French Hill, the chair of the House Financial Services Committee, indicated that the new U.S. administration plans to maintain support for nuclear energy funding just as an important decision regarding the ban approaches. In a discussion last month, Hill mentioned that World Bank president Ajay Banga has U.S. backing for potentially lifting the ban, suggesting that the bank is gearing up to support nuclear energy projects in developing countries.
Hill stated, “We support both the export of this technology and a broader approach to financing it.” Since the 1950s, the World Bank has not financed any nuclear projects, but that could change in the coming months as Banga reviews the bank’s energy policies.
Banga, who previously served as the CEO of Mastercard, is exploring how to incorporate new technologies that could make nuclear energy more affordable, such as smaller modular reactors. He has shown openness to discussing nuclear energy in his recent address to the European Commission. Although Germany and several smaller European nations have historically opposed nuclear energy in World Bank discussions, the U.S. is eager for the subject to be revisited. Washington is concerned that China and Russia are advancing in the construction of new nuclear facilities in Africa and Asia.
Hill pointed out, “I’m in constant discussions with other governments who are extremely interested in expanding nuclear, but they can’t get the attention of anyone in Western countries.” The World Bank is finalizing a new energy strategy that includes evaluating nuclear energy as part of a balanced energy solution, which will also encompass investments in renewable sources and natural gas.
This review is expected to wrap up in the coming months. The scrutiny of the World Bank’s nuclear stance arises amid the Trump administration’s evaluations of international financial institutions, which will conclude by August. While a right-wing manifesto known as Project 2025 has criticized multilateral organizations, Trump’s administration also established the Development Finance Corporation, indicating some support for organizations that align with U.S. national security interests.
Recently, Hill proposed legislation for the U.S. to pressure the World Bank into lifting the nuclear funding ban. This bill shows that easing the nuclear ban is a priority for the U.S., emphasized Todd Moss, a director at Energy for Growth Hub, who noted that the U.S. wants to ensure that American nuclear companies aren’t hindered by outdated policies from such an influential institution.
The World Bank has historically shied away from nuclear funding, approving only one loan for a nuclear project in 1959 to build Italy’s first atomic plant. Its current lending policy excludes nuclear technology, emphasizing that nuclear safety and non-proliferation risks fall outside its area of expertise.
China’s state development banks have surpassed the World Bank in financing various energy projects over the past ten years, with most of the new reactors under construction located in China and other Asian countries. Russia’s state nuclear corporation, Rosatom, has also been active in securing agreements with countries like Vietnam, Egypt, and Turkey to fund nuclear plants.
Although some U.S. firms, like Westinghouse, have found opportunities in global nuclear projects, official U.S. funding remains limited. Support for nuclear energy has started to gain traction in Washington, especially after President Biden signed legislation to expedite the approval process for new reactors.
The new legislation introduced by Hill and New York Democrat Ritchie Torres would further enhance U.S. backing for a trust fund to support nuclear initiatives through the World Bank and other global financial institutions. Hill has advocated that Western democracies should provide attractive financial offers for nuclear projects, ideally incorporating American technology and assistance from the U.S. Export-Import Bank.