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In the Union Budget FY 2024 the Indian government announced plans to expand the nuclear energy sector by private sector participation.
The government has invited Reliance Industries, Tata Power, Adani Power, and Vedanta, for investments of around $5.2 billion each.
This initiative aligns with India’s commitment to achieve 500 GW of non-fossil fuel-based energy by 2030, as pledged at COP26.
One proposed approach is to establish public-private partnerships where a government entity, such as NPCIL will hold a 51% ownership stake in nuclear plants. This structure would comply with existing laws.
Additionally, a majority government stake ensures that these entities remain accountable under the Right to Information Act, which will enhance transparency.
Nuclear Power Corporation of India Limited (NPCIL), a Public Sector Enterprise under the administrative control of the Department of Atomic Energy (DAE), the Government of India has overarching control over nuclear energy activities in India.
Historically, private sector involvement has been limited to engineering, procurement, and construction (EPC) roles, rather than in core operations or research.
Read about EPC and Investment models here: https://www.iasgyan.in/daily-current-affairs/investment-models
In 2023, the NITI Aayog released a report advocating for the promotion of Small Modular Reactors (SMRs) to encourage private sector participation.
The report emphasises the need for a regulatory framework that supports private investment and outlines goals to attract approximately $26 billion in private funding, particularly for research and development.
The Atomic Energy Act of 1962 serves as the primary governing statute for the nuclear energy sector in India.
This act empowers only the central government to manage the production, development, use, and disposal of atomic energy.
An amendment to the AEA in 1987 did not change the central control but reinforced it.
It caps the liability of the operator at Rs 500 crore. For damage exceeding this amount, and up to 300 million SDR, the central government will be liable.
All operators (except the central government) need to take insurance or provide financial security to cover their liability.
The constitutionality of the Civil Liability for Nuclear Damage Act, enacted in 2010, is currently under challenge in the Supreme Court.
The petition argues that the act is void ab initio (invalid or has no legal effect from the beginning.) and raises concerns regarding its implications for liability and nuclear safety.
The Atomic Energy Act of 1962 restricts private sector involvement in nuclear energy, granting the government exclusive rights to produce and manage nuclear power.
The Atomic Energy Regulatory Board (AERB) oversees radiation protection and regulatory compliance, but it faces criticism with respect to its independence and effectiveness. Previous attempts to establish an independent Nuclear Safety Regulatory Authority have not been realized, which highlighted a gap in regulatory oversight.
The presence of nuclear infrastructure poses significant safety risks, which necessitates robust liability frameworks to address potential disasters.
The CLNDA aims to provide a no-fault liability regime for victims of nuclear incidents, but it is currently facing legal challenges that question its constitutionality and the adequacy of compensation mechanisms.
India's nuclear energy capacity is projected to grow by 32 GWe, which requires substantial capital investment and a skilled workforce. PPP is one way to meet the demand and another is to skill development in this sector.
To enable the ambitious goals for nuclear energy expansion a comprehensive and adaptable legislation is essential to facilitate private investment and to streamline regulatory processes.
To attract private investment, the legal framework governing nuclear liability must be robust to ensure adequate compensation to victims and there should be robust safety protocols.
Historical precedents from the Chernobyl and Fukushima disasters teaches us the lesson about the importance of addressing these concerns effectively.
The Nuclear Safety Regulatory Authority Bill should be revived to issue safety policies and regulations without interference from the DAE to ensure its credibility and operational effectiveness.
There should be increased parliamentary oversight over the ARB's operations to enhance accountability.
Nuclear Plants Safety in India
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PRACTICE QUESTION Q.With growing energy needs should India expand its nuclear energy programme by including the private sector participation? Discuss with challenges associated with nuclear energy expansion in India. (250 words) |
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