Nuclear Watchdog’s Pitch for World Bank Financing Makes Headway

(Bloomberg) — Nuclear power’s pitch to broaden its appeal by tapping financing from the World Bank and other multinational lenders is gaining traction, according to the top international diplomat who’s charged with promoting the peaceful uses of atomic energy. 

International Atomic Energy Agency Director General Rafael Mariano Grossi said development banks are reconsidering their freeze of funding to new nuclear power projects. The Argentine diplomat, more well know for his investigations into Iran’s atomic activities, met with the World Bank last week in Washington and will present his agency’s case for looser funding rules at next month’s climate negotiations in Glasgow, Scotland. 

“It felt like breaking a glass ceiling,” Grossi said of his meeting with World Bank President David Malpass in an interview with Bloomberg News on Monday. “It is essential that we diversify our sources of funding.”

Lenders like the World Bank and European Bank for Reconstruction and Development have long shied away from giving cash to atomic power projects. A vocal group of anti-nuclear countries from Austria to New Zealand have kept financing off the table for decades. But pressure is mounting to change that approach. Beyond Grossi at the IAEA, Republican members of Congress have also authored a bill this year that would require U.S. representatives at the World Bank to lobby for international nuclear financing. 

Grossi said he’d bring the issue to the COP26 meetings next month in the U.K., where equitable access to green-energy finance is set to dominate debate. Wealthy nations have been bickering over a $100 billion fund that’s supposed to help developing countries manage climate change. The IAEA chief said nuclear reactors should play a role alongside solar and wind power as a potential solution to global warming. 

Bankers at international financial institutions are nevertheless cautious. 

Some bank shareholders remain “strongly opposed” because of concerns over safety and the long-term disposal of radioactive wast, EBRD managing director Harry Boyd-Carpenter said. In a written response to questions, the World Bank pointed to a June publication that dismissed the possibility for direct financing because nuclear power isn’t in its “areas of expertise.” 

Despite atomic power being one of the world’s great sources of emissions-free electricity, the technology’s been dogged by safety concerns since its inception. Commercial accidents from Three Mile Island in 1979, to Chernobyl in 1986 and Fukushima Dai-Ichi in 2011 repeatedly shook public and investor confidence in the technology. In many western economies, more old reactors are being taken offline without new units being built to replace them. 

The IAEA’s Grossi warned against reducing reliance on atomic energy further. “Without nuclear energy you won’t make it to the 2030, or 2050 or whatever other deadline is established,” he said, referring to the international goal set to keep temperatures from rising more than 1.5 degrees Celsius (2.7 degrees Fahrenheit) by mid century.  

His agency’s working with countries to advance commercialization of new small, module reactors that need to be ready by 2030 in order to boost nuclear power’s role in averting the worst impacts of global warming. 

“We have to have two to three in operation before the end of the decade,” Grossi said. “The demonstration effect will be enormous.”

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