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In a significant shift, India is gearing up to invite private investments totaling approximately $26 billion into its nuclear energy sector, aiming to bolster its non-carbon emitting energy sources. According to two government sources cited by Reuters, this move marks the first instance of New Delhi actively pursuing private funding for nuclear power, which currently contributes less than 2% to India’s total electricity generation.
The ambitious investment drive is part of India’s broader strategy to enhance its renewable energy capacity, with a target of having 50% of its installed electric generation capacity sourced from non-fossil fuels by 2030, up from the current 42%. The government is currently in discussions with five prominent private firms, including Reliance Industries, Tata Power, Adani Power, and Vedanta Ltd, each expected to invest approximately 440 billion rupees ($5.30 billion).
The Department of Atomic Energy, along with the state-run Nuclear Power Corp of India Ltd (NPCIL), has been engaged in extensive deliberations with these private entities over the past year to finalize the investment plan. The proposed funding aims to facilitate the construction of 11,000 megawatts (MW) of new nuclear power generation capacity by 2040.
Under the envisioned framework, private companies would finance the nuclear plants, covering expenses such as land acquisition, water resources, and construction outside the reactor complex. However, NPCIL would retain control over the stations’ construction, operation, and fuel management, in accordance with existing legislation.
The innovative hybrid model proposed for nuclear power project development is seen as a strategic measure to accelerate capacity expansion, as noted by Charudatta Palekar, an independent power sector consultant.
Notably, the plan does not require amendments to India’s Atomic Energy Act of 1962 but necessitates final approval from the Department of Atomic Energy. While Indian law prohibits private companies from establishing nuclear power plants, they are permitted to engage in supplying components, equipment, and construction services outside reactor facilities.
India’s nuclear capacity expansion has historically faced challenges, including fuel supply shortages and stringent compensation laws. However, recent agreements, such as the 2010 deal with the United States for reprocessed nuclear fuel supplies, signal potential avenues for overcoming these hurdles.
Despite these promising developments, India has deferred its target to add 2,000 MW of nuclear power from 2020 to 2030, highlighting the complexities inherent in nuclear energy expansion efforts. Nevertheless, the government’s proactive pursuit of private investment signals a concerted effort to bolster its energy infrastructure and transition towards a cleaner, more sustainable energy landscape.
Sources By Agencies
