Why Chima Came Up Short in Nuclear Exports

Why Isn’t China a Market Leader in Export of Nuclear Reactors?

In terms of building civilian nuclear reactors, China is a global leader at home but its efforts to export two PWR type reactors designs abroad has come up short. At home, China has 60 operating nuclear reactors on its grid (59GW) with another 29 under construction or planned starts (41 GW).

In terms exports, China has promoted two designs, an 1,100 MW PWR, the Hualong One, and a 1,400 MW PWR, an upgraded AP1000, the CAP1400. Only three Hualong One’s have been built and all three are in Pakistan with China financing almost all of the costs. No CAP1400s have been built as export deals.

Russia’s Rosatom is the Global Market Leader for Nuclear Reactor Exports

By comparison, Russia’s Rosatom nuclear export ministry has exported eight of its advanced 1,200 MW VVERs which are now under construction (four in Turkey and four in Egypt. Turkey expects the first unit to be in revenue service within a year.

Rosatom has two more of the 1,200 MW units under construction in Bangladesh. Russia has built two of its 1,000 MW VVER for India at Kundakulam and has four more under construction there. Recently, Rosatom has developed MOUs with Kazakhstan and Vietnam to ink export deals in these countries.

A plan to build eight 1,000 MW VVER for South Africa fell apart a decade ago due to over the affordability of the $50 billion in estimated costs. Eskom the South African state owned utilituy, was broke. Also, there domestic political scandals involving the secretive way the then incumbent government negotiated the deal. The controvery end the administration of then president Jacob Zuma. The Russians also sought to impose some strict terms for the deal.

• There will be no technology transfer of Russian reactor design to South Africa.
• The Russians will control all construction contracts. Any localization was definitely out.
• South Africa must do business with Rosatom for nuclear fuel exclusively for the next 20 years.
• Finally, South Africa must accept title to the Russian reactors at some point in the future and be liable for their safe operation as well as decommissioning.

Generally, Rosatom offers a “Build-Own-Operate” model, where Russia handles the financing, operation, and spent fuel management. Russia takes back all spent fuel for reprocessing. This is a big plus for some developing nations that lack the domestic expertise or capital to manage a nuclear program independently. Not wanting to look a gift horse in the mouth, they accept Russia’s near total control of the proposed project.

In Turkey Russia will pay for 50% of the costs and will build all four units, having failed to attract investors from Turkey or elsewhere for its share. Rosatom will operate the units for at least 15 years with plans to sell them off at that point. Russia plans to operate all four units in Egypt, on its terms, for their entire expected 60 years of service.

What Happened to China?

So where is China on the world market in terms of exporting its phenomenal expertise in building the planet’s largest fleet of operating nuclear reactors? It isn’t for a lack of trying.

China’s preferred reactor design for export is the 1,100 MW Hualong One but it has also put some effort into also exporting the 1,400 MW CAP1400. Both designs have been promoted as part of China’s massive foreign aid effort to developing nations known as the Belt and Road Initiative. The nuclear element is poetically called the “Nuclear Silk Road.”

Despite aggressive efforts, only two Hualong One reactors have been exported and completed, both in Pakistan. China’ ‘s two most prominent export efforts for the Hualong One came up empty handed in the U.K. and Argentina. China has been engaged with Turkey since 2016 about building multiple CAP1400s but the effort has never moved beyond the talking stage.

There are many complex reasons why China has not achieved any traction in terms of market share in the global nuclear market. Following is a review of China’s experience with export efforts for the Hualong One and the CAP1400.

Export Efforts Fall Short for the Hualong One

The Hualong One (HPR1000) is China’s flagship Gen III+ pressurized water reactor, designed to compete with Westinghouse AP1000 (1,150 MW) and the European EPR (1,000MW) both similarly sized PWRs. With a net capacity of approximately 1,100 MW, it represents China’s attempt to transition from an importer of western nuclear reactors (4 AP1000s, 2 EPRs, 2 CANDUs) to become a global nuclear exporter through the Belt Road program.

While China has aggressive export ambitions, its actual success in exporting the Hualong One is concentrated in a single market, with all other projects facing significant geopolitical and economic headwinds.

Pakistan Gets Three in a Sweetheart Deal

Pakistan is China’s only export success story. It built two Hualong One units and both are operating on that nation’s grid in Karachi, Pakistan, These units entered commercial operation in 2021 and 2022. They were financed largely by Chinese loans at a rate of 82% of the $9 billion cost. A third unit, at Chasma, was agreed to in 2023 and as of 2026 is under construction.

Argentina’s Overreach

China’s efforts to export a Hualong One to Argentina stalled out over disputes about financing and fuel. In 2022, Argentina signed a $10 billion contract for the Atucha III plant. However, the project faced repeated delays due to Argentina’s volatile macroeconomic instability and shifting political priorities by the government which is wary about giving China control of a major section of it energy security infrastructure for the next 60 years.

Some of reasons for the extraordinary high cost for an 1,100 MW plant were that China (CNNC) would be paying much higher labor rates for construction than at home, the supply chain would stretch halfway around the globe, and CNNC would have to import a lot of their own people to support the project competing for them against demands at home for the same engineering talent.

Also, China balked at two key requests by Argentina. The first was for China to finance 85% of the costs. Given Argentina’s perpetual economic crises, it was a a long shot that missed its target. The second was for China to contract with Argentina to provide the uranium for nuclear fuel for the Hualong One. Argentina has extensive uranium mining operations as well as a mill and conversion plants. All operating nuclear power capacity in Argentina are PHWRs, hence there is little or no need for enrichment services. 

While China might have been open to increasing the amount of credit it would be willing to offer, outsourcing the acquisition of uraniumn for nuclear fuel, intended to be a major cash cow for China for the project over the plant’s projected 60 year service life, was a total non-starter.

Argentina has built and operates two CANDU (PHWR) reactors. Domestic critics said it made no sense to build a Hualong One which would have meant ignoring the benefits of having a third PHWR. China has domestic two CANDU reactors but never built any after the first two. China offered to build Argentian a 700 MW CANDU unit but the proposal never got off the ground. It was included in the original $10 billion proposal but China apparently doubled down on the Hualong One.

U.K. Boots China Out of the Bradwell Deal

Things were looking up for China in 2022 to land a contract to build a Hualong One at the U.K. Bradwell site. The Hualong One successfully passed the UK’s rigorous and expensive Generic Design Assessment (GDA) in 2022 which was  a major technical milestone. However, the proposed Bradwell B project in Essex never got off the ground even though China’s state owned nuclear enterprises offered to take a 20% equity stake in the Sizewell 2 nuclear project as way to sweeten the Bradwell export opportunity.

In 2021 PM Boris Johnson removed Chinese state-owned firms (specifically CGN) from its nuclear infrastructure due to national security concerns. In doing so the UK gave up the Chinese investment (20% equity stake) in Sizewell C and has since then replaced it with a combination of government and private equity investors. Johnson had earlier booted a Chinese telecommunications firm off of a tender for the U.K.’s 5G wireless service for the same reasons. The prospect of Chinese economic and military espionage elements listening in on communications in the U.K. clearly spooked Johnson’s administration.

Other Markets: China has signed Memoranda of Understanding (MOUs) or entered preliminary talks with countries including Saudi Arabia, Ghana, and Kazakhstan, but none have reached the construction phase. The U.S. has been particularly concerned about Saudi Arabia’s flirtation with China to build its first two civilian nuclear reactors.

Recently, it appears, to consternation of nonproliferation policy experts and members of congress in the House and Senate, to have given in to Saudi Arabia’s demand for the right to enrichment of uranium to be included in a US Section 123 Agreement under the Atomic Energy Act.

Saudi Arabia has plans to build up to 16 1,000+ MW commercial reactors. It repeatedy threatened to give its nuclear reactor business to China unless the U.S. agreed to its demand to be able to enrich uranium, as a deterrent to Iran’s program, as part of any 123 agreement.

If it passes muster with Congress, the proposed Saudi 123 deal it will open the door for Westinghouse and other U.S. nuclear reactor vendors to export their designs to Saudi Arabia locking China out of that highly lucrative market.

The U.S. also worked to help Romania finance the completion of its two partially built 700 MW PHWRs at Cernavoda. More recently, Romania approved a final investment decision to build six NuScale 77 MW small modular reactors. The promise of U.S. export financing for some of the costs played a significant role in this decision. The combination of these actions have blocked China’s overtures to enter the Romanian energy market.

In January 2026 U.S. export finance commitments have been made to Poland to assist it in making a future final investment decision to build three Westinghouse AP1000s. Like the deal in Romania, the U.S. use of export finance tools has locked China out of Poland’s nuclear energy market.

Market Barriers for the Hualong One

A grab bag of other issues also stalled out China’s efforts to land deals to export it PWR to developing nations.

Costs: Developing nations are wary of getting in over their heads in terms of debt. This is an issue that caused Vietnam to cancel its ambitious plans for up to eight nuclear reactors in 2016. Developing nations in Africa appear to be shifting their views on large reactors opting instead to consider small, and cheaper, small modular reactors (SMRs). China does not have an SMR available for export.

Grid Issues: The 1,100 MW size is too large for many smaller developing nations. If a single unit provides more than 10% of a country’s total grid capacity, a sudden shutdown (trip) can cause a total blackout.

The CAP1400 is Too Big, Too Hard to Build,
and CostsToo Much

The CAP1400 (commonly referred to as the CAP1400 or Guohe One) is a Generation III+ pressurized water reactor developed by China’s State Power Investment Corporation (SPIC). While it was originally intended to be a major export product, it has been pushed aside for several reasons by the Hualong One.

Reasons for Limited Pursuit of Exports

Political Backing: The Chinese government decided to focus its diplomatic “Nuclear Silk Road” efforts on a single, standardized design to avoid internal competition. The Hualong One was chosen because it has a more diverse and more mature domestic supply chain and is perceived as being “more Chinese” and thus less reliant on foreign-derived intellectual property.

Intellectual Property and U.S. Rights: The CAP1440 is a scaled up version of the Westinghouse AP1000. Although China claims “full independent intellectual property rights” because the design exceeds the 1350 MWe threshold (the limit of the original technology transfer agreement), the reactor’s U.S. heritage remains a complicating factor.

Export Restrictions: Use of U.S.-derived technology can trigger U.S. export control laws (Section 810), which require U.S. government approval for re-export to third countries. This makes the CAP1400 a “diplomatic liability” compared to the Hualong One. In short, China decided it doesn’t need another reason to have trade disputes with the U.S.

Uncertain Progress to Commercial Maturity: The CAP1400 faced significant construction delays and unexpected costs. The demonstration units at Shidaowan only began supplying power to the grid in late 2024. Two units were built both taking five years to complete. Four more units are planned at Bailong. Construction there began in 2025. These units, according to World Nuclear News, are expected to cost $5.6 billion for each of the first two units which is twice the cost, historically, of the CAP1000 which is China’s mainstay PWR.

Also, countries typically prefer reactors with a proven “reference plant” that is already operational. By the time CAP1400 was ready, the Hualong One had already achieved commercial operation (2021) and China had already being built two in Pakistan. Vendors interested in the Hualog One need only hop a plane to Karachi to kick the tires on one.

Plus, in terms of experience with with decision of the Hualong One, China has built five Hualong One units (3 at Fujian and 2 at Guangdong) with at least 10 more planned at these and other domestic sites. China’s mature supply chain and experienced workforce are key success factors for the Hualong One’s growing domestic market share and, absent other factors, should have been big factors in favor of success in exporting it.

Stuffing 10 Pounds of Potatoes on a 5 Pound Sack

At a rated power of 1,400 MW the CAP1400 is one big reactor even by Chinese domestic design standards. Many developing nations, China’s primary export targets, have electrical grids that cannot support such a large single unit. If a 1500 MWe reactor trips, it can destabilize a smaller national grid. China even at one time considered a 1,700 MW version, but never made plans to build one.

The cost of a CAP1400, even at China’s bargain rates and favorable credit terms, is just too big a deal for many cash strapped developing nations to take on. For instance, Ghana has set aside plans for large reactors and is now looking at cheaper SMRs. Similar scenarios are also taking place in Kenya and other African nations.

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