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Special Feature | November 2017

Not in the race yet

<span style="font-weight: bold;">Though India is pursuing its nuclear ambition, it is yet to join the race for it. However, its compulsions arise from the need to light up the future of millions of its citizens.</span> <p></p> <p> India has embarked on an ambitious programme to add 9,000 MW of nuclear power capacity in the next few years, mostly riding on the new indigenously developed 700 MWe (mega watt electric) pressurised heavy water reactors (PHWRs) as part of its clean energy thrust. Besides, two more 1000 MWe units each will be set up by Atomstroyexport, a unit of Russian state nuclear corporation Rosatom, at the Kudankulam Nuclear Power Station (KKNPS), where four reactors were set up earlier with Russian technology. </p> <p>These proposals come at a time when the total installed capacity of nuclear power was at 6,780 MWe at the end of September 2017. Announcement of these projects in the middle of 2017 have given a shot in the arm for the Indian nuclear equipment and component manufacturers, who were saddled with meagre orders from domestic nuclear power projects. Some nuclear experts are exuding hope that these events will boost the chances of India's entry into the Nuclear Suppliers Group (NSG), which will open up the global market for the Indian nuclear gear manufacturers.</p> <p>The new reactors are also of significantly higher capacities compared to the PHWRs currently in operation - 14 reactors are of 220 MWe capacity, and a couple of them are of 540 MWe. The ten new reactors will be installed in Kaiga in Karnataka (2 units), Chutka in Madhya Pradesh (2 units), Gorakhpur in Haryana (two units) and Mahi Banswara in Rajasthan (four units). However, everything is unlikely to happen in a jiffy going by the past record - installation of such plants at these locations are in the works since 2007.</p> <p>If these plans are implemented in a time-bound manner, it is expected to add ample base power capacity from nuclear, alongside thermal, balancing the new renewable capacities that are expected to be built by 2022.</p> <p> <span style="font-weight: bold;">Present Scenario</span><br /> The Nuclear Power Corporation of India Limited (NPCIL) is presently operating 22 commercial nuclear power reactors with an installed capacity of 6780 MW. The reactor fleet comprises two boiling water reactors (BWRs) and 18 PHWRs, including one 100 MW PHWR in Rajasthan which is owned by the Department of Atomic Energy (DAE), Government of India, and two 1000 MW VVER reactors (Pressurised Water Reactor type) at Kudankulam Nuclear Power Station (KKNPS). Currently, NPCIL has four reactors under various stages of construction totalling 2800 MWe capacity.</p> <p>NPCIL, a Public Sector Enterprise under the administrative control of the Department of Atomic Energy (DAE), Government of India, is the nodal agency for operating atomic and implementing nuclear power projects (NPPs) for generation of electricity in the country.</p> <p>Starting with the original 220 MW PHWR design imported from Canada, India's nuclear technology has evolved over the years to 540 MWe and later to 700 MWe at present. There are 14 numbers of 220 MW PHWRs out of 22 reactors in operation today. About 2800 MWe of nuclear capacity under construction consists of two units of 700 MWe of capacity each in Rajasthan Atomic Power Project and Kakrapar Atomic Power Project. Units 3 and 4 of the Kudankulam plant are expected to be commissioned by 2022-23.</p> <p>Pre-project activities at new sites, which were accorded 'in principle' approval by the Government, have been initiated.</p> <p> <span style="font-weight: bold;">Boost to nuclear suppliers</span><br /> With the announcement of 10 PHWRs that will be completed in a 10-year timeframe, the nuclear equipment supplier in the country got into a celebratory mood. Manufacturing process of nuclear equipment has to be very advanced - precise, regimented, carried through controlled processes, on calibrated equipment and by qualified people. Such a manufacturing setup comes with associated costs. Before that they might have incur development costs. But the orders for nuclear equipment are few and far between. That means working without margins, let alone profit, was a challenge for these companies. </p> <p>Companies like Godrej &amp; Boyce (G&amp;B) and Kirloskar Brothers Limited (KBL) are some of the prominent suppliers to NPCIL and undertaking independent research programmes on some of these critical technologies. KBL has also obtained necessary certifications from American Society of Mechanical Engineers (ASME), which qualify the company to manufacture nuclear grade equipment and components. Indian nuclear equipment and component manufacturers are hoping that they will be in a position to get more orders, including from some foreign players once India becomes a member of NSG.</p> <p>The International Atomic Energy Agency (IAEA) forecasts that the global nuclear industry is estimated to seek around $80 billion in annual investment over the coming decade as countries strive to meet climate and clean energy goals. The ambitious project announced by the government in India is estimated to create supply opportunities to the tune of `70,000 crore over the next 10 years.</p> <p> <span style="font-weight: bold;">Technology</span><br /> Globally, there are Russian (Rosatom), French (EDF-AREVA), American (GE), Korean technologies for NPPs in use. Generally speaking, the quality systems that go into building NPPs and the associated processes of manufacturing and documentation may vary slightly. The technology currently being used in the Indian nuclear programme is `Candu', which is a Canadian technology. And it has been proved effective, stable, safe and delivered results as expected. </p> <p>India is also part of the consortium International Thermo-nuclear Experimental Reactor (ITER), which is setting up NPP using fusion technology in France. The technology, developed by collaborative efforts of other countries like USA, South Korea, France, UK, and China, is expected to emerge as a sustainable technology in the years to come. </p> <p>While India is moving towards bigger capacities, the recent nuclear disasters are pushing the leading manufacturers towards smaller capacities that can be installed quickly, at modest cost and with operational simplicity. China is developing these plants that are called small modular reactors (SMR). Others are also pursuing the technology, with around 50 different SMR designs worldwide, according to the IAEA. Russia leads the way on floating plants, while the U.S. firms, including Westinghouse and Babcock &amp; Wilcox, have been developing their own SMRs, along with smaller start-ups like the Bill Gates-backed Terrapower.</p> <p> <span style="font-weight: bold;">Cost competitiveness</span><br /> Being a vast country and having varied requirements locally and nationally, all the available sources of energy should be tapped in India. However, cost is a factor that decides utility value of a product or service. That brings in the question, is nuclear competitive enough to promote at a time when the focus is shifting to solar and wind as clean energies in India and their prices are falling steeply over the years?</p> <p>However, solar and wind are not steady sources of power as their productivity change during the day and every day. So, that increases the importance of thermal sources like gas, coal and nuclear, which play the role of base power. Besides, nuclear power, in relative terms, is a much cleaner power. It is a sustainable source and in some technologies it is also regenerating in nature. Being a cleaner power, nuclear could prove to be a better source of power compared to coal.</p> <p>Prices of solar are hovering in the range of `2.42/kWh, while wind is at a low of `2.64/ kWh in the reverse bidding process adopted by the government in the recent years. Going ahead, the prices of renewable energy sources are expected to fall further due to intense competition. However, nuclear prices are at `4.29/kWh, if one has to go by the cost of power generation at the unit I &amp; II of KKNPS. </p> <p>Installation of NPP is expensive when compared to other sources of power, but its operating cost is very low in the long run. As such, if one goes by lifecycle cost, it could prove economical too. However, if there are more orders for NPP equipment coming forth, then there is every possibility of cost of installation will also come down in due course.</p> <p> <span style="font-weight: bold;">Safety performance</span><br /> Given that three major nuclear disasters have taken place in the past, India's track record has been good, so far. NPCIL has achieved about 458 reactor years of experience in safe operation of NPPs. The Environmental Management System (EMS) and Occupational Health and Safety Management System (OHSMS) as per ISO-14001: 2004 and IS-18001: 2007 respectively are maintained at all the stations. </p> <p>'By following the principle of ALARA (As Low As Reasonably Achievable) and maintaining the highest standards of safety within NPPs, the occupational exposures of employees of the company at various NPPs are maintained well below the values specified by the regulator, Atomic Energy Regulatory Board (AERB),' claims NPCIL. </p> <p>The environmental releases of radioactive effluents from NPPs are maintained significantly low (average less than one per cent of the limits specified by AERB). </p> <p> <span style="font-weight: bold;">Post-Fukushima perception</span><br /> Following the meltdown at Japan's Fukushima reactor complex in 2011, the beleaguered nuclear industry has been focused on rolling out safer, large-scale reactors across the world, even as many countries have reined in their ambitions on nuclear. </p> <p>Japan has put a bar on building new NPPs and replacing the existing ones. Many European countries like Switzerland, Denmark and Italy are following Germany in bringing down their reliance on nuclear power. Following the Fukushima disaster, Germany has taken a decision to shut down all 17 of the country's nuclear reactors by 2022.</p> <p>However, several developing countries still want to pursue their nuclear ambitions by invoking some supporting measures in order to meet the growing energy demand. </p> <p> <span style="font-weight: bold;">Liability cover</span><br /> India's Civil Liability for Nuclear Damage (CLND) Act 2010 was considered to be a hindrance by NSG and its members till a couple of years' back. That was when (in June 2015) the Indian Nuclear Insurance Pool (INIP), launched by the state-owned General Insurance Corporation-Reinsurer (GIC-Re) and 11 other Indian insurance companies, which offers an insurance product for NPCIL for covering the operator's liability under the provisions of the Civil Liability for Nuclear Damage (CLND) Act 2010. They have later launched a separate product to specifically cover the risks of the suppliers under the Act. </p> <p>GIC-Re said recently that reactor makers like GE and Westinghouse are showing interest in taking insurance from the pool. The insurers under the pool provides for Rs.1,500 crore as maximum liability for nuclear damage. This has taken care of the contentious issue to a great extent. </p> <p>Only three nuclear power accidents have been reported, so far, over the last three decades - at Fukushima, Three Mile Island and Chernobyl. </p> <p> <span style="font-weight: bold;">Slow in execution </span><br /> Though India has begun its nuclear power initiatives in right earnest in 1960s and the first plant become operational in 1969, its progress has been very slow compared to China. Though China has commissioned its first plant only in 1994, it is having 20 projects of 22,596-MWe capacity under construction in May 2017. </p> <p>In India, Nuclear power has only a modest share (about 2 per cent of total installed capacity of 330 GW at end-May 2017) in the overall power. However, the factors working in India's favour are indigenous technology, a self-contained ecosystem, all know-how from siting to operating NPPs, and above all, a great safety record, say experts.</p> <p>On the operation front too NPPs have performed poorly during April-September compared to the previous year. NPPs plant load factor for the six months to September 2017 was at 57.31 per cent compared to 74.80 per cent recorded in April-September 2016. This is despite the target to achieve 75.99 per cent of PLF during the period. In September 2017, the performance was even poorer at 54.82 per cent, compared to 74.38 per cent in the month in 2016.</p> <p> <span style="font-weight: bold;">The way forward</span><br /> The debate on 'whether to adopt nuclear or not' aside, the country has embarked on a project to provide quality 'Power for all'. To achieve this, the country has to tap all the sources of energy - thermal, hydro, solar, wind, geothermal, biomass etc., including nuclear. </p> <p>All the development activities such as urbanization, building dams, roads, ports and transportation, to cite a few examples, have an environmental impact, explained an expert.</p> <p>Does this mean that India has entered 'Nuclear Race'? It is not in the affirmative as yet. If such an ambitious initiative can yield something more like NSG membership that would be a bonus for the nuclear suppliers from India. NPCIL has proved to be sensitive and responsible corporate citizen as of now. It has been participating and contributing to the debates in the international forums.</p> <p>However, there is every reason for the electricity consumer to seek power at the least cost in the prevailing circumstances. Somehow nuclear industry has to bring down the costs and evolve as a competitive source of energy for the masses. </p> <p>Nuclear power sector, particularly biggies like Westinghouse and AREVA, had to face serious financial consequences in the wake of certain unfavourable developments. But financial sector has evolved so much that instruments that take care of such uncertainties can be developed. India is offering an insurance policy to take care of their risks to an extent. For a change let India lead the world to light. </p> <p> <span style="font-weight: bold;">- BS Srinivasalu Reddy</span></p>
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