India is aiming to attract private investments totaling approximately $26 billion into its nuclear energy sector. This move is geared towards boosting electricity generation from sources that do not emit carbon dioxide. This marks a significant departure from the past, as traditionally, nuclear power in India has been entirely funded by the government. Presently, nuclear energy contributes less than 2% to India’s overall electricity generation. However, with this initiative, India intends to increase its reliance on non-fossil fuel sources, with the goal of achieving 50% of its installed electric generation capacity from such sources by 2030, up from the current 42%.
Structure of the Investment Plan
Under this plan, the Nuclear Power Corporation of India Ltd. (NPCIL) will retain the authority to construct and operate the nuclear power stations and manage their fuel, as per Indian regulations. Private companies, on the other hand, are expected to earn revenue through the sale of electricity generated by the power plants. NPCIL will operate these projects on behalf of the private investors for a fee. Importantly, this initiative does not necessitate any amendments to India’s Atomic Energy Act of 1962. However, final approval from the Department of Atomic Energy will be required.
Involvement of Private Companies
The government is currently in discussions with several private entities, including Reliance Industries, Tata Power, Adani Power, and Vedanta Ltd., among others. Each of these companies is expected to invest approximately $5.30 billion. Over the past year, the Department of Atomic Energy and NPCIL have engaged in multiple dialogues with these potential investors regarding the investment plan.
Objective and Scope of Investment
Through this investment initiative, the Indian government aims to add 11,000 megawatts (MW) of new nuclear power generation capacity by 2040. NPCIL, which presently owns and operates India’s nuclear power plants with a combined capacity of 7,500 MW, has already committed investments for an additional 1,300 MW. Under the proposed funding arrangement, private companies will invest in nuclear plants, procure land and water resources, and undertake construction activities in areas surrounding the reactor complex.
