UN Watchdog Calls On Development Banks to Finance Nuclear Projects

International development banks that have shunned funding for nuclear power generation projects for decades, need to overcome opposition from some stakeholders and begin backing such plants, Rafael Mariano Grossi, Director General of the International Atomic Energy Agency (IAEA), told the Financial Times.  

Multinational lenders such as the Asian Development Bank and the World Bank are currently “out of step” with the most recent attitudes toward nuclear energy of their government shareholders, according to Grossi.  

The World Bank, for example, hasn’t backed a nuclear project since the late 1950s, due to opposition from stakeholders including Germany.  

Germany has been the odd man out in the new view on nuclear energy for civil purposes—it shut down last year all its remaining nuclear power plants and has said that the debate on nuclear energy is a “dead horse”.

Meanwhile, many economies – including Japan – now look to use more nuclear power generation in a renaissance for the technology after the energy crisis and the Russian invasion of Ukraine.

“All these development banks or international finance institutions are out of date, out of step with what is happening,” the IAEA’s Grossi told FT.

“This is a…post-Chernobyl sort of mantra, which does not correspond any more to the policy indication from countries and the ideas and projects we are seeing.”

At the COP28 climate summit at the end of last year, the United States and 21 other countries pledged to triple nuclear energy capacities by 2050, saying incorporating more nuclear power in their energy mix is critical for achieving their net zero goals in the coming decades.   

“The Declaration recognizes the key role of nuclear energy in achieving global net-zero greenhouse gas emissions by 2050 and keeping the 1.5-degree Celsius goal within reach,” the U.S. Department of State said.

Even Japan is bringing back nuclear power as a key energy source, looking to protect its energy security in the crisis that led to surging fossil fuel prices.

The Japanese government confirmed in December 2022 a new policy for nuclear energy, which the country had mostly abandoned since the Fukushima disaster in 2011.  

By Tsvetana Paraskova for Oilprice.com

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