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October 9, 2008

An electric imperative

Issue 19 - Oct 2008
Gulzar Natarajan

Nuclear power forms just over 2 percent of our total power generation and the proposals on the
pipeline are expected to add a meagre 3 GW. The India-US nuclear deal and the subsequent removal
of restrictions on trade in civilian nuclear components by the Nuclear Suppliers’ Group (NSG), comes as a shot in the arm for nuclear power generation.

Globally too, faced with high commodity prices and environmental concerns, nuclear power plants, with their low operating costs, have become financially viable. The huge business opportunity in nuclear capacity addition, estimated at over US$40 billion, would be enough to attract global majors like
General Electric, Areva, Hitachi and Westinghouse.

Collaborating with them will enable technology transfer and facilitate the development of
domestic expertise in the private sector, which would be critical to lowering costs and sustaining
the program.

The biggest challenge facing the development of our nuclear power generation program is that of
sourcing uranium fuel. With scarce domestic sources and access denied by major producers like
Australia, even the existing nuclear power plants are running at barely half their capacities. All
equipment supplies should be linked with assured fuel supply for the entire plant life or access to captive uranium mines across the globe.

The commercial and political influence of such large companies would facilitate the tie-up of uranium supplies. Given the plentiful domestic thorium reserves, efforts to expedite the development of the thorium-based fuel cycle should be strengthened. A strong regulatory regime, with specific focus on safety and nuclear waste disposal, will have to be put in place to reassure the
significant public safety concerns about nuclear power.

Renewable energy sources like wind, biomass, and solar have enormous potential in India and will become attractive propositions in the coming years as the cost of production declines and as other fuels become expensive.

The government will need to encourage its development with appropriate output-based fiscal incentives (See “The new Manhattan Project”, by Atanu Dey, Pragati Issue 9 – Dec 2007). With most of the solar and wind power potential areas being located away from load centres, there will have to
be substantial investments in transmission capacity to evacuate the power generated.

Read the rest at Urbanomics, Gulzar Natarajan’s blog


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