Key Takeaways:
Russia has significantly expanded its nuclear reactor exports and diplomacy, with Rosatom maintaining a dominant position in the global market. Rosatom controls approximately 70% of reactor exports, 40% of fuel conversion/enrichment, and 20% of fuel fabrication.
Rosatom’s success is driven by comprehensive services, flexible business models, concessional financing, and strong diplomatic support from the Russian government. KSG assesses that Western sanctions are unlikely to significantly disrupt this model in the near term.
Rosatom’s expanding portfolio positions it to leverage these projects for geopolitical influence, particularly in strategic locations like Belarus, Hungary, and Türkiye; in addition to developing countries in Africa, Asia, and Latin America.
However, the financial strain from the war in Ukraine, will likely limit Russia’s ability to finance numerous large-scale overseas nuclear power projects. Additionally, growing competition from the China National Nuclear Corporation (CNNC) poses a significant long-term challenge to Rosatom's market share, especially in emerging markets.
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Russia’s dominant international market position
In 2022, Rosatom reported a 10-year order portfolio for nuclear power plant (NPP) construction abroad valued at $135.9 billion, encompassing 34 power units across 11 countries, securing roughly 70% of the global market share. Additionally, Rosatom reported a $200.8 billion order book for NPP servicing and fuel supply abroad. It provides lifecycle maintenance services for 48 power units outside of Russia. In 2022, Rosatom accounted for 38% of the global uranium conversion, 46% of global uranium enrichment, and 17% of the global market for nuclear fuel fabrication, supplying fuel to 78 reactors worldwide.
Russia’s competitive advantage
Rosatom's market dominance is driven by a combination of commercial, financial, and political factors that provide it with significant advantages over competitors. Its comprehensive services portfolio covers the entire NPP lifecycle, including construction, operation, and decommissioning, as well as the nuclear fuel cycle, including uranium mining, conversion and enrichment, nuclear fuel fabrication, spent nuclear fuel removal (SNF) and radioactive waste treatment (RAW). This "one-stop-shop" model is particularly attractive to countries new to nuclear energy.
Rosatom also offers flexible business models tailored to the needs of its clients. For countries that wish to manage the NPP themselves post-construction, Rosatom provides a “turnkey” approach, handing over ownership and control of the NPP upon completing all engineering, procurement, and construction (EPC) work. This approach is industry-standard and suits countries concerned about retaining control over critical infrastructure and domestic electricity production.
Unique to Rosatom is its Build-Own-Operate (BOO) model, in which Rosatom retains ownership and operational control of the NPP after its completion. This approach is attractive to nuclear energy newcomers who prefer to offload the risks and costs of managing a complex NPP to Rosatom, albeit at the expense of losing ownership of domestic energy production assets. So far, only Türkiye has opted for the BOO model.
Furthermore, Rosatom reactors are of the Soviet/Russian VVER design, which uses a specialised type of nuclear fuel produced by Rosatom. Rosatom thus dominates the nuclear fuel market for VVER reactors worldwide.
Russia also provides concessional financing for overseas NPP construction through low-interest, long-term loans from state-owned banks, Rosatom subsidiaries, and the National Welfare Fund. This financial support, coupled with strong diplomatic backing from President Vladimir Putin, bolsters Rosatom's global standing. Rosatom secures its reactor exports through government-to-government agreements between Moscow and host nations. However, the war in Ukraine has severely strained the Kremlin's financial resources, likely limiting Russia's capacity to fund large, multi-billion-dollar projects abroad at the same scale as before.
Overview of Russia’s nuclear energy diplomacy
Rosatom dominates the global market for the construction, operation, and servicing of nuclear reactors, supported by Moscow’s extensive network of bilateral engagements. Intergovernmental agreements (IGAs) provide the legal framework for the construction of NPPs and Nuclear Research and Technology Centers (NRTCs). In addition to IGAs, non-binding agreements cover areas such as nuclear personnel training and preliminary discussions regarding the potential construction of NPPs and NRTCs. While many non-IGA-level agreements may not result in NPP construction contracts, they establish a foundation for future collaboration, potentially tilting the playing field in Rosatom's favour if these countries decide to pursue NPP construction.
The table below categorises countries based on their dependence on Rosatom for nuclear fuel supplies measured by the share of national electricity produced—or projected to be produced—from reactors built and supplied by Rosatom.
High dependence | |
Medium dependence | Bangladesh, Egypt, Iran, Türkiye, and Uzbekistan are moderately dependent on Rosatom. Rosatom is either planning (Uzbekistan), constructing (Bangladesh, Egypt, Türkiye), or expanding existing NPPs (Iran), which will provide a significant, though not dominant, portion of their electricity supply. |
Low dependence |
The following table categorises countries based on their level of engagement with Russia's nuclear energy diplomacy:
High engagement | |
Medium engagement | Bulgaria, Czechia, Kyrgyzstan, Slovakia, and Uzbekistan have signed agreements either for the import of VVER-specific nuclear fuel (Bulgaria, Czechia, Slovakia) or for the construction of a small nuclear power plant (SNPP) (Kyrgyzstan, Uzbekistan). |
Low engagement | Bolivia, Burundi, Nicaragua, Kazakhstan, Myanmar, Serbia, Zambia, Zimbabwe, and Vietnam have signed various non-binding agreements or IGAs for NRTCs. Bolivia, Nicaragua, Serbia, Vietnam, and Zambia have signed non-binding agreements as well as IGAs for the construction of NRTCs. Memoranda of Cooperation (MOCs) for nuclear personnel training have been signed by Kazakhstan, Myanmar, and Zimbabwe. Burundi has signed a roadmap covering both non-energy nuclear uses and potential power generation. Vietnam also signed a joint statement with Russia, prioritising Russia as a potential partner should the country decide to develop a nuclear energy program. |
The Kremlin’s interests in nuclear reactor exports
Rosatom has become an important asset of Russian soft power. Exporting NPPs fosters long-term diplomatic ties, likely linking Moscow with foreign capitals for up to a century. VVER reactors have an operational lifespan of 60-80 years, with up to 10 years needed for construction and an additional 10-20 years for decommissioning. NPP agreements often stipulate that Russia will supply nuclear fuel, manage SNF removal, and handle RAW treatment, further embedding Russia in the energy systems of recipient nations. NPPs thus offer Russia a role in shaping these countries' electrification, decarbonization, energy independence, and development strategies. The 4.8 GW El-Dabaa NPP in Egypt currently under construction supports Cairo’s plans to increase desalination. The 2.4 GW Rooppur NPP in Bangladesh is expected to reduce power outages that hinder the development of the country's garment industry, boosting economic growth. The 4.8 GW Akkuyu NPP in Türkiye is designed to help Ankara diversify its energy mix and reduce dependence on imported fossil fuels, including from Russia.
NPP construction abroad also strengthens Moscow’s hard power. Former Eastern Bloc countries such as Armenia, Belarus, Bulgaria, Czechia, Hungary, and Slovakia are heavily reliant on Rosatom for nuclear fuel to operate Soviet-era or newer VVER reactors. In addition to this energy dependence, NPP construction gives Moscow significant financial leverage. The high construction costs—estimated at $30 billion for Egypt's nuclear power plant and $20–22 billion for Türkiye's—are financed almost entirely through Russian loans, resulting in significant Russian stakes in these countries' external debt.
Russia has made significant diplomatic gains through reactor exports. Former Eastern Bloc countries’ reliance on Rosatom nuclear fuel has blocked EU attempts to sanction Rosatom following Russia's invasion of Ukraine. In 2020, Russia provided 26% of the uranium enrichment services used in the EU as a whole.
The construction of the Akkuyu NPP in Türkiye and the expansion of the Soviet-era Paks NPP in Hungary with two new power units further strengthens Russia’s strategic energy portfolio within NATO, particularly given the sharp decline in its pipeline gas exports to Europe. The Paks II NPP also reinforces the pro-Russian stance of Hungarian Prime Minister Viktor Orbán and his Fidesz party. Since the 2014 election, Orbán has promoted the Paks II NPP as a cornerstone of his promise to provide cheap electricity, a goal facilitated by low-interest Russian loans that help make that promise financially viable.
Limitations to Russian nuclear reactor exports
Russia's ability to develop new NPP projects, particularly in developing countries, is increasingly constrained by financial limitations. While existing projects are expected to continue, the economic strain from the war in Ukraine has significantly reduced Russia's capacity to finance new, large-scale, overseas NPPs. Developing countries, which often lack the resources to fund these projects independently, are likely to receive less financial support from Russia and may be forced to turn to international capital markets, where borrowing costs are higher and prospective investors may have reputation and sanctions-related concerns over investing in Russian-led projects. As a result, the expansion of Rosatom’s global footprint may slow, unable to match the pace of growth seen in the past decade.
Moreover, Russia faces increasing competition from China in the global nuclear market. China has made significant efforts to expand its nuclear diplomacy, offering financial incentives such as low-interest loans—a hallmark of its Belt and Road Initiative (BRI)—to potential clients. Unlike Russia, China has the financial capacity to support numerous large-scale projects and does not carry the same degree of reputational and sanctions-related risk (as Russia) for prospective partners. This positions China as a more reliable partner for developing nations, providing not only stable financing, but also integration with broader BRI infrastructure initiatives. China's recent deal to assist Uganda in developing its first NPP highlights its strategy to expand civilian nuclear cooperation, particularly with African countries. This growing competition from the China National Nuclear Corporation (CNNC) further compounds Russia’s financial constraints, making China a more attractive option for nations seeking to develop NPPs.
A further vulnerability in Russia’s NPP exports is Rosatom’s reliance on foreign-made equipment, particularly steam turbines. Historically, companies like Alstom and Siemens have been key suppliers to countries constructing Rosatom NPPs, but cooperation has come to a halt due to Russia’s 2022 invasion of Ukraine. However, this is unlikely to significantly impede the construction of Rosatom NPP. Russia manufactures steam turbines domestically through Power Machines, while numerous Chinese companies also produce the turbines. Therefore, sanctions on cooperation with Rosatom are more likely to increase Sino-Russian cooperation in the civilian nuclear field, and grow the share of Russian and Chinese-made equipment used in Rosatom NPPs, rather than significantly impeding Russia’s ability to construct NPPs.
US, EU, and Ukrainian efforts to reduce reliance on Russian nuclear fuel supplies
Since the 2022 invasion of Ukraine, Western countries have taken steps to reduce their reliance on Rosatom for nuclear fuel services. In 2022, the G7 committed to reducing dependence on Russian nuclear fuel supplies. At COP28 in 2023, the Sapporo 5 group (Canada, France, Japan, UK, USA) agreed to expand nuclear fuel production. In May 2024, the Biden administration banned the import of Russian uranium and nuclear fuel and invested $2.7 billion into domestic uranium enrichment, aligning with its G7 and COP28 commitments.
1 - US efforts
The US is seeking to challenge Rosatom’s dominant position in the nuclear energy market by increasing domestic reactor exports, although these efforts have not yet yielded significant results. At COP28, the U.S. announced financial tools through the U.S. Exim Bank to promote the export of U.S.-made Small Modular Reactors (SMRs). The core of President Biden's use of domestic reactor production for political objectives is a proposed deal with Saudi Arabia: helping Riyadh build a nuclear energy industry in exchange for normalising relations with Israel.
2 - EU efforts
The EU is also working to reduce its dependence on Russian nuclear fuel, but it has not yet banned the import of Rosatom reactor fuel due to certain member states’ reliance on Rosatom fuels for electricity production. In 2023, the EU launched the Accelerated Program for Implementation of a Secure VVER Fuel Supply (APIS), selecting a consortium led by Westinghouse (USA) to develop EU-produced VVER fuel. Framatome (France) also received EU funding to produce VVER fuel. Bulgaria, Czechia, and Slovakia have signed supply agreements with Westinghouse and Framatome to replace Russian fuel. Bulgaria received its first Westinghouse deliveries in May 2024, Czechia expects deliveries from both Westinghouse and Framatome later this year, and Slovakia is scheduled to receive Framatome deliveries starting in 2027.
3 - Ukrainian efforts
Energoatom, Ukraine's national nuclear operator, and Westinghouse have agreed to build new power units in Ukraine using Westinghouse’s AP1000 technology despite the ongoing war. Ukraine, which operates four VVER nuclear power plants, transitioned to Westinghouse fuel after the annexation of Crimea in 2014 and fully halted purchases from Rosatom in 2022. Ukraine is now exclusively supplied by Westinghouse. Additionally, Energoatomn has partnered with Westinghouse to produce VVER fuel domestically.
Forward Look
KSG assesses that Rosatom’s existing projects are likely to remain resilient to potential US and EU sanctions aimed at curtailing Russia’s nuclear reactor exports. Building a broad coalition to sanction Rosatom, particularly among emerging market economies, is unlikely to be successful. China and India have emerged as crucial wartime economic partners for Moscow, providing support in the face of Western sanctions. Given India's strategic role in counterbalancing China in the Indo-Pacific, the US is unlikely to exert significant pressure on India over Rosatom’s construction of the 6.8 GW Kudankulam NPP. Türkiye, Kazakhstan, Kyrgyzstan, and Uzbekistan have become key facilitators in Russia’s procurement of sanctioned Western technology, suggesting they are likely to remain cooperative with Russia in the field of nuclear energy. KSG therefore assesses that sanctions are unlikely to disrupt Rosatom's foreign NPP construction projects. Equipment no longer available from Western suppliers such as Alstome, Framatome, and Siemens can be sourced from China and in part also from Russia. NPPs currently under construction in Bangladesh, Egypt, and Türkiye are therefore unlikely to become stranded assets, avoiding significant deadweight losses for their host countries.
KSG assessment and collection concluded that covert effects by Western capabilities will be the most effective means at slowing Russia’s nuclear efforts globally. KSG prepared a list of covert options (made available to subscribers only).
KSG assesses that Western efforts to reduce Russian energy dependence will lead to Russia losing both the US and EU as nuclear fuel markets, mirroring its loss of the European gas market. This will diminish Russia's ability to use nuclear fuel supply restrictions as a geopolitical tool, like it has with natural gas. While US and EU efforts are changing the international fuel scale supply landscape, Ukraine’s transition to alternative nuclear fuel suppliers took nine years, indicating that Rosatom may continue to serve as a key supplier to former Eastern Bloc countries, potentially until 2030.
Rosatom is likely to attempt to shift its market share and nuclear energy diplomacy increasingly towards Africa, Asia, and Latin America. The loss of the EU market following Russia's invasion of Ukraine is pushing Russia to explore new opportunities in these regions. Rapid population growth, economic development, and rising energy demand are driving the search for reliable, low-carbon energy solutions, making Africa, Asia, and Latin America attractive targets for Russia’s nuclear exports and influence.
KSG assesses that Rosatom’s primary challenge will be Russia’s diminished ability to provide concessional financing for large-scale NPP projects abroad, as the war in Ukraine continues to strain financial resources. Nevertheless, ongoing hydrocarbon sales offer Russia some financial flexibility, leading KSG to predict a reduction in the scale of loans rather than a complete cessation of overseas NPP financing.
Rosatom is likely to become a leading exporter of Small Modular Reactors (SMRs), which are smaller and more cost-effective than traditional NPPs and better suited to less developed countries. Russia's strained finances due to the war economy are likely to drive it to encourage SMR exports, which will make providing concessional financing easier. Although China, Japan, the USA, and Canada are also developing SMRs, which could challenge Russia's market share, Rosatom holds a significant lead. Russia has already signed SMR contracts with Kyrgyzstan and Uzbekistan, and it currently operates a Floating Power Unit (FPU) in the Arctic—a ship-mounted SMR that powers coastal areas. Rosatom intends to export FPUs to coastal nations with unmet energy needs. Although no countries have publicly committed to acquiring FPUs yet, Russia is expected to leverage this technology to assist developing nations, particularly after severe weather events. KSG further assesses that FPUs could serve as a pretext for Russia to expand its naval presence by securing naval bases and docking rights in these regions.
Rosatom's expanding portfolio of NPPs may increase the risk of Russia leveraging them to extend its military influence abroad, with countering NATO likely being a primary objective. Belarus, Hungary, and Türkiye represent Russia’s most significant strategic assets in this regard. In Belarus, the Ostrovets NPP is strategically positioned on NATO's easternmost flank and is protected by a special Belarusian military unit, raising potential security concerns, particularly for Lithuania. Russia could exploit the reactor’s location to spread disinformation about its safety, using this as a pretext for increased military deployments in Belarus. Such disinformation campaigns could also aim to incite fear in Vilnius and test NATO’s response to hybrid threats, combining conventional military tactics with psychological warfare and misinformation. Furthermore, Hungary’s decision to proceed with Rosatom-led construction of the Paks II NPP has already deepened divisions within the EU over sanctioning Rosatom. This gives Russia leverage over Hungary, potentially exacerbating Budapest’s strained relations with NATO Allies. Finally, Türkiye hosts Incirlik Air Base, NATO’s largest nuclear weapons storage site, as well as the ballistic missile defence radar installation at Kürecik. There is a possibility that Russia could use the Akkuyu NPP to station military and intelligence personnel near these sensitive locations.
KSG anticipates increasing US support for expanding domestic reactor production and exports, particularly of SMRs, as this aligns with the broader US economic strategy of strengthening domestic manufacturing and job creation in strategic sectors to remain competitive with China, a major reactor producer, albeit primarily for its own energy needs.
KSG anticipates that the projected expansion of Russian nuclear reactor exports to emerging markets with rapidly growing energy demands will help reduce their dependence on hydrocarbons. This supports the IAEA’s forecast, which contrasts with ExxonMobil's outlook, suggesting that global oil consumption will peak by 2030 and that oil markets could experience a surplus by then, potentially leading to a long-term decline in prices.