<div align="justify">Recent announcements on new civil nuclear power plant construction in India reflect a sense of realism in the central government’s expectations about India’s nuclear power growth prospects.<br /><br />The Union Cabinet’s May 2017 decision to approve construction of ten 700 Megawatt electric (MWe) Indian Pressurised Heavy Water Reactors (IPHWR-700s) in ‘fleet mode’ and the subsequent conclusion of a ‘General Framework Agreement and Credit Protocol’ (GFA) for Units 5 & 6 of the Kudankulam Nuclear Power Plant (KKNPP) between NPCIL and Atomstroyexport, a subsidiary of Russia’s Rosatom, reveal an acceptance of the fact that domestic IPHWR-700s and Russian pressurised water reactors (PWRs or VVERS) are the only two credible pathways for India to boost its nuclear power capacity in the short to medium term.<br /><br />While both options will help consolidate India’s domestic nuclear industry in different ways, these developments also mean that other avenues for international collaboration are dicey at best, given supplier wariness about India’s nuclear liability law and the general turmoil in the global nuclear industry.<br /><br />Though the decision to build 10 IPHWR-700 units in fleet mode shows that both the Department of Atomic Energy (DAE) and the Centre have a certain confidence in this design, it is also driven by the need to place sizeable orders on Indian industry to achieve economies of scale and ensure that delivery timelines can be met. All 10 IPHWR-700s are expected to be completed by 2031 and will cost Rs 1.05 lakh crore, if cost escalations and interest payments during construction are kept aside, <br />while resulting in the employment of some 33,400 people. Basically, ‘fleet mode’ construction is envisaged to break the ‘capacity creation vs existing orders’ conundrum that currently plagues the Indian nuclear industry. <br /><br />For large capacity reactors, however, the Russian VVERs are the only real prospect. At KKNPP in Tamil Nadu, two 1050 MWe AES-92 units — a version with an added safety feature in the form of a passive heat removal system — namely KKNPP-1 & 2 are already operational, while KKNPP-3 & 4 are under construction. Now, with the GFA for KKNPP-5 & 6 in place (also AES-92 units), contract negotiations for the same has entered what Rosatom calls the ‘practical phase’ with ‘the obligations of the two sides, costs and other important conditions of their cooperation’ being delineated, setting the stage for the project, which has an approved cost of Rs 49,621 crore, to take-off.<br /><br />As such, the final contract for these units is linked to the implementation of the ‘Programme of Action for Localisation in India’ signed by India and Russia in December 2015, to increase the domestic content value of Russian VVERs built in India.<br /><br />Since NPCIL now feels confident about operating Russian VVERs, and the fact that the Russians offer substantial credit lines for their reactors in addition to promise of localisation, two more units at Kudankulam, which are both likely to be newer 1200 MWe AES-2006 units, as well as six more AES-2006s at Kavali, Andhra Pradesh, are being projected for construction.<br /><br />Issue of liability<br /><br />Unlike the Russian VVERs, however, other foreign designs are unlikely to be built in India anytime soon. India’s Civil Liability for Nuclear Damage (CLND) Act, 2010, is still a major deterrent for Western and Japanese suppliers despite New Delhi instituting an Indian Nuclear Insurance Pool in June 2015 to serve as a workaround to supplier liability. For example, even as the French Electricite De France (EDF) submitted a revised proposal to NPCIL in July 2016 for six EPR-1650 reactors to be built at Jaitapur, Maharashtra, it sought guarantee of ‘the same level of protection’ in relation to liability that is available at the international level.<br /><br />But liability isn’t the only issue getting in the way of these reactor types being built in India. Although both coastal zone and environmental clearances are in place for the Jaitapur site, DAE is now rather wary of building this type, given the very high estimated project cost for EPR-1650 construction in India, even with appreciable localisation levels. There are now also doubts about the quality of certain French-origin forgings, given reports about the same from China’s Taishan project.<br /><br />The prospects for GE-Hitachi’s Economically Simplified Boing Water Reactor (ESBWR) to be built in India are even dim-<br />mer. In June 2016, DAE said it would not support the construction in India of any reactor design that did not have a reference plant, thus ruling out the ESBWR for the foreseeable future. At the same time, DAE re-assigned the Kovvada site in AP, earlier reserved for GE-Hitachi, to Toshiba-Westinghouse’s AP-1000 design.<br /><br />However, the AP-1000’s pros-pects in India are also bleak after Westinghouse filed for bankruptcy in the US. Although Westinghouse insists that the Kovvada project is ‘structured in a manner that does not include construction risk’ and that an Indian partner would actually execute the project, DAE insiders are sceptical about Westinghouse’s staying power for this venture.<br /><br />Incidentally, the AP-1000, too, does not have an operational example anywhere, only units under construction. Going forward, the only non-Russian large reactor likely to be built in India will be the DAE’s 900 MWe Indian PWR (IPWR), which is currently in the design stage.<br /><br />(The writer is a New Delhi-based commentator on security and energy issues)</div>
<div align="justify">Recent announcements on new civil nuclear power plant construction in India reflect a sense of realism in the central government’s expectations about India’s nuclear power growth prospects.<br /><br />The Union Cabinet’s May 2017 decision to approve construction of ten 700 Megawatt electric (MWe) Indian Pressurised Heavy Water Reactors (IPHWR-700s) in ‘fleet mode’ and the subsequent conclusion of a ‘General Framework Agreement and Credit Protocol’ (GFA) for Units 5 & 6 of the Kudankulam Nuclear Power Plant (KKNPP) between NPCIL and Atomstroyexport, a subsidiary of Russia’s Rosatom, reveal an acceptance of the fact that domestic IPHWR-700s and Russian pressurised water reactors (PWRs or VVERS) are the only two credible pathways for India to boost its nuclear power capacity in the short to medium term.<br /><br />While both options will help consolidate India’s domestic nuclear industry in different ways, these developments also mean that other avenues for international collaboration are dicey at best, given supplier wariness about India’s nuclear liability law and the general turmoil in the global nuclear industry.<br /><br />Though the decision to build 10 IPHWR-700 units in fleet mode shows that both the Department of Atomic Energy (DAE) and the Centre have a certain confidence in this design, it is also driven by the need to place sizeable orders on Indian industry to achieve economies of scale and ensure that delivery timelines can be met. All 10 IPHWR-700s are expected to be completed by 2031 and will cost Rs 1.05 lakh crore, if cost escalations and interest payments during construction are kept aside, <br />while resulting in the employment of some 33,400 people. Basically, ‘fleet mode’ construction is envisaged to break the ‘capacity creation vs existing orders’ conundrum that currently plagues the Indian nuclear industry. <br /><br />For large capacity reactors, however, the Russian VVERs are the only real prospect. At KKNPP in Tamil Nadu, two 1050 MWe AES-92 units — a version with an added safety feature in the form of a passive heat removal system — namely KKNPP-1 & 2 are already operational, while KKNPP-3 & 4 are under construction. Now, with the GFA for KKNPP-5 & 6 in place (also AES-92 units), contract negotiations for the same has entered what Rosatom calls the ‘practical phase’ with ‘the obligations of the two sides, costs and other important conditions of their cooperation’ being delineated, setting the stage for the project, which has an approved cost of Rs 49,621 crore, to take-off.<br /><br />As such, the final contract for these units is linked to the implementation of the ‘Programme of Action for Localisation in India’ signed by India and Russia in December 2015, to increase the domestic content value of Russian VVERs built in India.<br /><br />Since NPCIL now feels confident about operating Russian VVERs, and the fact that the Russians offer substantial credit lines for their reactors in addition to promise of localisation, two more units at Kudankulam, which are both likely to be newer 1200 MWe AES-2006 units, as well as six more AES-2006s at Kavali, Andhra Pradesh, are being projected for construction.<br /><br />Issue of liability<br /><br />Unlike the Russian VVERs, however, other foreign designs are unlikely to be built in India anytime soon. India’s Civil Liability for Nuclear Damage (CLND) Act, 2010, is still a major deterrent for Western and Japanese suppliers despite New Delhi instituting an Indian Nuclear Insurance Pool in June 2015 to serve as a workaround to supplier liability. For example, even as the French Electricite De France (EDF) submitted a revised proposal to NPCIL in July 2016 for six EPR-1650 reactors to be built at Jaitapur, Maharashtra, it sought guarantee of ‘the same level of protection’ in relation to liability that is available at the international level.<br /><br />But liability isn’t the only issue getting in the way of these reactor types being built in India. Although both coastal zone and environmental clearances are in place for the Jaitapur site, DAE is now rather wary of building this type, given the very high estimated project cost for EPR-1650 construction in India, even with appreciable localisation levels. There are now also doubts about the quality of certain French-origin forgings, given reports about the same from China’s Taishan project.<br /><br />The prospects for GE-Hitachi’s Economically Simplified Boing Water Reactor (ESBWR) to be built in India are even dim-<br />mer. In June 2016, DAE said it would not support the construction in India of any reactor design that did not have a reference plant, thus ruling out the ESBWR for the foreseeable future. At the same time, DAE re-assigned the Kovvada site in AP, earlier reserved for GE-Hitachi, to Toshiba-Westinghouse’s AP-1000 design.<br /><br />However, the AP-1000’s pros-pects in India are also bleak after Westinghouse filed for bankruptcy in the US. Although Westinghouse insists that the Kovvada project is ‘structured in a manner that does not include construction risk’ and that an Indian partner would actually execute the project, DAE insiders are sceptical about Westinghouse’s staying power for this venture.<br /><br />Incidentally, the AP-1000, too, does not have an operational example anywhere, only units under construction. Going forward, the only non-Russian large reactor likely to be built in India will be the DAE’s 900 MWe Indian PWR (IPWR), which is currently in the design stage.<br /><br />(The writer is a New Delhi-based commentator on security and energy issues)</div>