Deloitte advises cheaper funding for thermal reactors

Imported light water reactors (LWRs) will play a key role in India's nuclear capacity addition. But, due to high capital costs of LWRs and high interest rate regime in the country, the power produced will be expensive.

Deloitte, in its report on ''Nuclear power in India - A way forward'', says if LWRs are funded with long-duration, cheaper debt, then power tariff becomes comparable to the tariff of power produced from pressurised heavy water reactors (PHWRs), and will be able to compete with fossil fuels. The report was released by Atomic Energy Commission chairman R K Sinha at the Indian Nuclear Energy Summit recently.

Currently, the state-run Nuclear Power Corporation is in the process of acquiring several LWRs with foreign collaborations with unit with capacities ranging between 1,000 Mw and 1,650 Mw.

''The corporation is correctly following a strategy of a combination of indigenous PHWRs and imported LWRs. Given the price sensitivity of electricity market in India, it is important to get right finance for LWRs - both tenure and rate - to get a competitive tariff,'' Deloitte said.

According to the report, there will be opportunities in the fuel value chain, including mining, fuel processing, enrichment, reprocessing, waste management and heavy water production. There will be more joint ventures or acquisition by Indian companies to gain expertise in various areas of nuclear supply chain. ''This will help in possible localisation of design and production of equipment for nuclear power plants. This association could possibly be extended to supply conventional equipment to other countries,'' Deloitte observed.

Post-Fukushima nuclear accident, there has been a lot of apprehension on safety of nuclear power and the country has seen public resistance at several proposed nuclear power plant sites. Deloitte suggested the apprehensions on nuclear power need to be allayed by familiarising general public on India's approach to safety standards, its policies and regulations on safety and its spectacular safety record.