In June 2022, Energoatom, the Ukrainian state energy company that operates the country’s nuclear fleet, signed an agreement with the Westinghouse electric company to build 9 new nuclear reactors. The history of both companies casts doubts on the likely success of such a project. The Export-Import Bank of the United States (EXIM) and Ukrainian Ministry of Finance are expected to provide guarantees, passing the risks to taxpayers in both countries. In an unlikely scenario where any unit will be completed by Westinghouse in Ukraine, it will bring unnecessary financial and security risks. Instead, public funding should support a modern distributed energy system based on renewable energy and improved efficiency of the nation’s energy use.
Research conducted by Ecoaction and the Bankwatch network suggests that public funding should support a modern distributed energy system based on renewable energy and improved efficiency of the nation’s energy use.
The partnership between Energoatom and Westinghouse involves significant financial risks, as both companies have a history of delayed projects, cost overruns, and mismanagement. Westinghouse, in particular, has faced bankruptcy and project cancellations in the U.S., raising concerns about their capacity to deliver on the agreement. The guarantees from EXIM and the Ukrainian government mean that taxpayers would be responsible for covering potential failures, making the project financially unstable.
Moreover, the construction of new nuclear reactors in Ukraine would increase the country’s dependence on a centralized energy system, which has proven vulnerable, especially in times of russian aggression. The risks of nuclear accidents, reliance on imported uranium, and exposure to energy price fluctuations are significant. Ecoaction and Bankwatch argue that instead of expanding nuclear energy, Ukraine should focus on building a resilient, decentralized energy system based on renewable sources, which would provide more security and economic benefits.
Download the Issue paper:
What is wrong with EXIM’s plan to pay for Westinghouse reactors in Ukraine? (PDF)