The common claim made by critics of the Indo-US civilian nuclear agreement is that, ultimately, it can’t really be about powering light bulbs. The fun fact always cited: the Indian government’s own projection that nuclear power won’t contribute more than 3 per cent of the country’s energy requirements in the near future.
This figure is more than wonky. On the downside, it assumes no private capital, no imported nuclear fuel. And on the upside, it expects the Department of Atomic Energy’s (DAE) thorium-cycle gamble to pay off. All three are suspect variables. Let’s turn to the past for a better indication. History shows a country can ramp up nuclear production once it gets the right policies and politics in place.
The most famous example is France. France is the pin-up girl of nuclear power, generating 70 per cent of its electricity from glow-in-the-dark fuel. Less known is how fast this was accomplished. The figures are stunning. In a 10-year period from 1989 to 1999, France was able to get 42,000 MW of nuclear-based power up and running. In one year, 1985, the country operationalised over 7,000 MW of nuclear power capability. In comparison, India’s total nuclear power capacity today is less than 3,800 MW.
China is threatening France’s record. Tote up the construction sites and completion targets. They show that between 2010 and 2015 Beijing will bring 22,300 MW of nuclear energy on stream. It has drafted plans to add yet another 19,400 MW between 2014 and 2018. The Left in New Delhi claims nuclear power is too expensive. Chinese communists share their dialectic, but clearly not their mathematics.
Vinay Rai, energy fellow at Stanford University, has shown that nuclear energy is competitive with coal and natural gas. The problem, he says, is that India’s lack of nuclear fuel access “has had the effect of making nuclear power appear more expensive”. In an environment similar to which exists in the West, nuclear power costs between 6.7-4.2 cents per kilowatt-hour and is comparable to the 10.1-3.9 cents price range for coal and natural gas in India.
Indian nuclear power has been constrained by more than just fuel. Capital has been lacking: nuclear energy is cheap over time but initial costs are high. Then there’s technology. Thanks to sanctions, Indian engineers have had to develop expensive home-bred replacements. The nuclear deal will lift all these barriers.
Undo these shackles and what France accomplished in the 1980s could be repeated here. It would actually be easier to do this these days. Reactors in those days were small, largely in the 900 MW range. Today, one could nearly double India’s nuclear power capability with just two 1,500 MW reactors. France had to finance the reactors from its own pocket. Today, exporting and building reactors is a well-oiled business. France and Russia have off-the-shelf package deals for customers combining fuel, reactor and finance.
Finally, modern reactors are more safe, less waste-producing and come up faster than they did even 15 years ago. “New reactors take an average six years to build, have one year of trials, and link up to the grid on the eighth year,” says Anupam Srivastava, a technology expert at the University of Georgia. The real constraint on nuclear expansion, say some experts, is a global shortage of trained engineers.
So what is an optimistic but realistic scenario for Indian nuclear power after the deal is done? Under the existing government-only system, the constraint is capital. The Nuclear Power Corporation of India Limited (NPCIL) has cash reserves of $2-3 billion. Given that infrastructure projects normally require the government to provide 20-25 per cent of the cost, this could be leveraged to as much as $15 billion. This would pay for 10,000 MWs of reactors.
Revolution can only come from privatisation. A suitably amended Atomic Energy Act would allow the NPCIL to license reactor building and operating to the private sector. Unsurprisingly, the Tatas, Reliance and other Indian firms have already been talking with foreign firms about acquiring technology. Given time, India Inc will probably master the technology and get into the line itself. Look at China. Its second generation reactors are already 50 per cent local. The next lot, says the World Nuclear Association, will be 75 per cent indigenous. See a trend?
There are a lot of ifs regarding a nuclear renaissance in India. The privatisation amendment could become stuck. The DAE is, in the end, a government bureaucracy. And the Indo-US nuclear deal has plenty of hoops to jump through. But if all the tumblers fall into place, a 20 per cent nuclear component to India’s electricity production by 2030 is a distinct possibility. “There is no limit on the amount of nuclear power India can generate, providing it invests the right amount of resources,” says Manohar Thyagaraj of the US-India Business Alliance.
The people who say there are no nukes in India’s energy future echo the ones who said the 1991 economic reforms would be a disaster, that infotech was a lot of bunkum, and generally suffer from Indo-pessimism. It all depends, to paraphrase a famous leftist, whether India can seize the coming year.