Trump’s new foreign investment agency: Itching to build on nuclear quicksand

In 2018 a Republican Congress, with strong Democratic support, created the US International Development Finance Corporation to “provide the developing world with financially sound alternatives to unsustainable and irresponsible state-directed initiatives.” That’s government-speak for competing with China’s Belt and Road initiative. It didn’t take very long, however, for the new agency to fall in line with an irresponsible state-directed initiative of its own—the Trump administration’s all-out effort to encourage nuclear exports.

In June, the agency, whose own rules prohibit financing nuclear exports, proposed to fling the doors open to such financing, without limiting its scope to the agency’s mission to help the economies of the lower income countries with modest, environmentally sensible projects. There is no hint on what sorts of conditions would apply on funding nuclear reactors. Would the country have to have a system of safety regulation? Would it have to meet security requirements? Would it have to allow international inspections? It isn’t even clear whether the agency’s support would be limited to US reactor exports, and therefore subject to the requirements of the Atomic Energy Act’s Section 123 or whether they could also cover equipment purchases from other suppliers. Such details determine whether a federal bureaucracy is constrained to act responsibly, or whether it is free to cater to the latest whims of the White House.

To justify its proposed action, the agency relies on the administration’s ritual talking points—that nuclear exports will “offer an alternative to the financing of authoritarian regimes while advancing US nonproliferation safeguards and supporting US nuclear competitiveness.” These pearls are straight out of the administration’s April 2020 interagency report “Restoring America’s Competitive Nuclear Energy Advantage.”

So are the agency’s assurances that advanced “small modular reactors” and “microreactors” will have significantly lower costs than existing nuclear power plants and “could help deliver a zero-emission, reliable, and secure power source to developing countries, promoting economic growth and affordable energy access in underserved communities.” This is all pie in the sky: None of these plants have been built, and their characteristics and economics are speculative.

But if the proposed change is restricted to small reactors or microreactors, the nuclear industry’s influential registered lobby, the Nuclear Energy Institute, hasn’t heard about it. The Institute’s president crowed her unqualified approval: “The US International Development Finance Corporation’s proposed policy change to lift its legacy…