Private Nuclear Energy Participation in India

India’s Nuclear Energy Sector Expansion
• The Indian government announced plans to expand the nuclear energy sector, including partnerships with the private sector for research and developing Bharat Small Reactors (BSR), Bharat Small Modular Reactors (BSMR), and newer nuclear energy technologies.
• The announcement is part of India’s ambitious pursuit of decarbonisation of energy generation and achieving 500 Gigawatts of non-fossil fuel-based energy generation by 2030.
Challenges in the Indian Nuclear Energy Sector
• The Atomic Energy Act, 1962 (AEA) gives the government sole control over all activities in respect of nuclear energy.
• The Supreme Court of India dismissed a petition challenging the provisions of the AEA, which restrict involvement of private entities in the licensing of nuclear power.
• The Civil Liability for Nuclear Damage Act, 2010 (CLNDA) is pending a challenge to its constitutionality, which seeks a declaration for the act to be void ab initio.
Challenges and Potential Solutions
• The AEA restricts the involvement of private entities in the licensing of nuclear power, a situation that has been criticized by the Supreme Court.
• The NITI Aayog report and the Union Minister of Finance’s statement contemplate partnering with private participants to attract nearly $26 billion of investments into the sector.
• Attracting private investment in nuclear energy requires significant changes to the AERB’s structure and functions, along with efforts by organizations such as the NPCIL and the DAE to create programs that encourage private participation while ensuring robust regulatory oversight of the sector.
Potential Structure for Private Investment
• A possible approach is to form public-private partnerships where the NPCIL or a similar government body/authority holds 51% ownership of nuclear plants, aligning with existing laws.
• Entities with a majority government stake would be covered under Section 2(h) of the Right to Information Act (RTI) Act, ensuring transparency.
• The Constitutionality of the Civil Liability for Nuclear Damage Act, 2010 (CLNDA) is presently challenged in a writ petition and is pending adjudication before the Supreme Court.
Specific Needs and Legislation
• India’s country profile recognizes an in-principle proposed gross increment of 32 GWe in the Indian nuclear energy production capacity.
• Strict and comprehensive legislation is crucial to address these needs and ensure ease of business.