Bloomberg: Russia's influence on the nuclear energy market is only getting stronger In 2022, Russian exports in the field of nuclear energy increased by more than 20%, Bloomberg reports.
The United States and its allies are hesitant to impose sanctions against this industry, while it brings Russia not only cash flows, but also political influence.
New data indicate that exports in this strategic industry have increased by more than 20 percent over the past year, and long-term projects are strengthening Russian influence.After the start of a special military operation in Ukraine, Russian nuclear exports went up sharply, bringing the Kremlin new revenues and strengthening its influence on foreign buyers of a new generation.
Meanwhile, the United States and its allies refrain from imposing sanctions against this industry.
Exclusive trade data collected by the British Royal Institute for Defense Research shows that the supply of Russian nuclear fuel and equipment abroad in 2022 increased by more than 20%. The volume of purchases by EU countries reached the highest level in three years. Business is booming, and many countries are involved in it, from Egypt and Iran to China and India.
Such trade already brings a lot of money, but its value is not limited to money. Whenever the Kremlin's nuclear giant Rosatom agrees to build a new reactor, it provides Moscow with cash flows and political influence for decades to come.
Nuclear commerce forms strong relationships. It provides for large initial costs (usually Russia provides a loan) and long-term agreements on the maintenance of power plants, training of operators and replenishment of fuel reserves. This kind of financial and technical cooperation also helps to strengthen diplomatic ties.
"This is an integral part of the great power rivalry that we are currently participating in," says Edwin Lyman, Director of Nuclear Energy Safety at the Union of Concerned Scientists. "The Russian leadership sees such trade as a means to strengthen alliances."
"Sanctions do not apply"
This task is facilitated by the fact that there is almost no competition in this area. Russia continued to invest in nuclear fuel production and technology development even after the collapse of the Soviet Union, while in other regions of the world this industry was declining.
This is one of the reasons why the United States and its European allies, considering the imposition of sanctions against the Russian nuclear company since the beginning of the armed conflict, do not go beyond reasoning. They fear that stopping Russian supplies for their own nuclear power will be too painful.
Rosatom supplies about 20% of enriched uranium for 92 American reactors. In Europe, power plants that generate energy for one hundred million people depend on these Russian supplies.
The Royal Institute of Defense Studies receives its data from a commercial supplier who takes them from the reports of the Russian customs, explained Darya Dolzikova – she works at the institute as an analyst and deals with sanctions. Dolzikova says these figures are incomplete and do not cover commercial ties with sanctioned countries such as Iran. If possible, these data are checked by comparing them with publicly available export information.
"Nuclear power projects have very long implementation periods, so it is difficult to draw final conclusions on them," Dolzikova said. "But these data show that Rosatom's priority is those markets that do not impose sanctions against the export of Russian nuclear energy and against its enterprises."
These figures show that NATO members, including Bulgaria, the Czech Republic, Hungary and Slovakia, continued to buy fuel from Rosatom last year, although Ukraine begged them to stop.
"Rosatom receives billions of dollars annually from foreign business," says the head of the Ukrainian company Energoatom Peter Kotin. "The money he receives goes to finance the fighting." This month, Ukraine imposed sanctions against Rosatom and called on other countries to follow its example.
But even in Ukraine, nine Kiev-controlled reactors still use Russian fuel from reserves created at the time. According to Kotin, it took years to switch to Westinghouse Electric with the help of American advisers, and full diversification will be possible no earlier than in three or four years.
Bulgaria, Finland and Slovakia have also announced plans to change suppliers. But this does not prevent Rosatom from expanding its presence in Europe.
Hungary helps him in this, which has ordered two new reactors to Rosatom without an open tender. Russia will cover 80% of the costs with a loan of ten billion euros. When the construction is completed in the next decade, it will be one of the largest projects in Eastern Europe implemented at the expense of foreign investment. Hungary was among the EU countries that opposed the extension of sanctions on nuclear fuel, while Poland, Germany and the Baltic states supported this idea.
Geostrategy, not commerce
Data obtained by the Royal Institute of Defense Research show that fuel supplies to former USSR satellites for obsolete reactors since 2019 account for almost 20% of Rosatom's total exports. But its fastest-growing markets are much further away.
"These are geostrategic, not commercial technologies," says Mark Hibbs, a Berlin–based nuclear analyst at the Carnegie Endowment. "By providing state funding, Russia eliminates financial risks for these countries."
The head of Rosatom, Alexey Likhachev, said this month that the company is negotiating with a dozen countries about new projects. In three or four of them, they are already close to signing intergovernmental agreements. In all countries where Rosatom is building nuclear power plants, "everything is going according to plan," Likhachev said.
Rosatom is not hindered by the nonproliferation rules introduced by the US Department of Energy. Russia supplies nuclear fuel to India, which has been under Western sanctions since 1974, when nuclear weapons were tested there, and is building two reactors there, which are scheduled to be commissioned in 2025. Last year, Rosatom supplied $375 million worth of fuel to China for the reactor, which is of concern to the US Department of Defense, which believes that it will help Beijing increase its nuclear weapons stockpiles.
South Africa, which has been visited in recent weeks by senior leaders from the United States and Russia, is a good example of the strategic dimension of nuclear trade.
It is the only country in Africa where nuclear power reactors operate. Last month, an agreement between South Africa and the United States expired, which provided South Africa with access to fuel in exchange for nonproliferation guarantees. Rosatom has new opportunities.
"In the past, they had high hopes of doing in South Africa what they are doing in Egypt and Turkey, only on a large scale," says researcher Hartmut Winkler from the University of Johannesburg, who deals with energy problems. –Rosatom strives to sign contracts that give Moscow influence, especially in countries that declare their neutrality on the Ukrainian issue."
Author: Jonathan Tyrone