UPDATE 1-US energy secretary encourages Congress to ban uranium supplies from Russia

(Adds comments from Granholm)

WASHINGTON, March 20 (Reuters) - U.S. Energy Secretary Jennifer Granholm said on Wednesday she encourages the U.S. Congress to ban uranium supplies from Russia, as doing so would free up funds to support domestic development of fuel for next generation nuclear reactors.

The U.S. House passed legislation last December to ban imports of the fuel for nuclear power plants as part of Washington's response to Russia's full-scale invasion of Ukraine. Similar legislation has been held up in the Senate by a hold by Republican Senator Ted Cruz, over an unrelated matter.

Under a deal struck by lawmakers, passing the ban on the imports would unlock funds to expand domestic uranium enrichment and for producing a special uranium fuel called high assay low enriched uranium, or HALEU, for next generation reactors.

"Hopefully we can get that ban in place in order to unlock" those funds, Granholm told a House of Representatives hearing on her department's budget. "I strongly hope and encourage that Congress does that so that we can move with alacrity." (Reporting by Timothy Gardner Editing by Marguerita Choy)