Time to pull the plug on Indo-French nuclear-power project

Time to pull the plug on Indo-French nuclear-power project

French Foreign Minister Jean-Yves Le Drian attends a joint press conference at the Ministry Of External Affairs in New Delhi on Dec. 15, 2018. (AFP)

During a visit to India last week, French Foreign Affairs Minister Jean Yves Le Drian claimed that both sides had made a breakthrough in the negotiations over the long-delayed Jaitapur nuclear-power project.

In 2008, India and France decided to collaborate on building a 9.9 gigawatt nuclear-power plant, with six 1650 megawatt reactors. The plant was to be equipped with European Pressurized Reactors (EPR), the most modern nuclear reactors French company Areva had designed. The project was touted as the largest industrial project ever undertaken in India, and a major plank of Indo-French relations.

However, in the decade since the announcement there has been little progress on the project and a lot has changed in the global energy scenario, which raises existential questions about the feasibility of, and the need for, such a large nuclear-power project.

And of course, there has been tremendous opposition to the project not only from environmentalists, but also people living near the site of the project, the village of Jaitapur, about 600 kilometers south of Mumbai.

There are numerous issues surrounding the project. The first relates to the choice of EPR reactors. It is surprising that India opted for an entirely untried and untested technology. It does not help that the few EPR projects that are under construction or planned have been bogged down in problems, including severe delays and extremely high cost overruns. Very embarrassingly for EDF, the French utility company that is supposed to build the Jaitapur plant, it has failed to successfully complete an EPR project in its own backyard.

It began building an EPR plant at Flamanville in Normandy in 2007, boasting that it contained the world’s latest and safest reactor. The facility was supposed to be completed by 2012 and reinforce the reputation of the French for prowess in nuclear energy. Twelve years later, however, Flamanville has become an embarrassment for EDF and French technology; not only is the project still nowhere near completion but its budget has soared almost four-fold to more than 11 billion euros ($12.5 billion).

In 2015, the French nuclear safety agency announced that it had found a serious fault in the reactor vessel at Flamanville, causing further outrage about the project and putting pressure on the French government to follow the example of European partners in reducing the country’s dependence on nuclear power. The government has since announced that it aims to cut nuclear power’s share of the electricity mix from the current 75 percent to about 50 percent.

The fate of other EPR projects is not very different. The construction of the world’s first EPR began in 2003 at Olkiluoto in Finland. It was supposed to be completed in 2009, but the project has suffered numerous delays, the latest of which was announced in late November and pushed back the date of the plant becoming operational to 2020.

France and India are walking a tightrope over the controversial issue of ultimate responsibility for safety.

Ranvir S. Nayar

Safety fears is the primary reason for the opposition of the residents of Jaitapur to the project. France and India are walking a tightrope over the controversial issue of ultimate responsibility for safety. While Indian law holds equipment suppliers and construction companies liable for any accidents, the French are hardly keen to engage in any venture that leaves them potentially facing unlimited liability, especially when the plant would be operated by Indian nuclear-power company NPCIL.

Aside from safety, another reason for opposition to the plant is the large amount of land that would need to be acquired for the construction of the six reactors and other facilities.

However, these are not the only reasons why the Jaitapur plant is not a good idea. The economic viability of the project is also questionable. Though the final cost is yet to be ascertained, if Flamanville’s single reactor is expected to cost upwards of 11 billion euros, the final cost of six reactors could well be in the vicinity of 70 billion euros. Even in 2009, the cost of electricity produced by Jaitapur was predicted to be nearly 9 rupees per kilowatt hour, nearly three times the cost of power from a coal-fired thermal power plant.

Moreover, the entire energy scenario in India has changed over the past decade, making Jaitapur look much more like a white elephant than a much-needed power source. Ten years ago, India was struggling with severe power shortages and renewable energy was still in a nascent stage. Since then, the sharp mismatch in energy demand and supply has been bridged to a large extent and, as a result, many proposed power plants have remained on the drawing board.

But the biggest change has come from the renewable-energy sector, mainly solar. In the past few years, solar-energy generation in India has risen sharply and the government proposes to have installed capacity of more than 175 GW of renewable energy by 2022, of which 100 GW would be solar. In 2017, India added 4.6 GW of solar-energy capacity, taking the total to about 17 GW. The growth in solar-energy production has been propelled by extremely low prices for solar panels. As a result, energy suppliers are selling electricity for even less than 3 rupees per kwh, with some bids closer to 2.5 rupees. In such a situation it becomes impossible for any power or distribution company to justify prices that are more than three times as high, as will be the case with Jaitapur.

Yes, solar energy is not available around the clock and wind energy depends on climatic conditions, so India does need nuclear power to have an ideal energy mix with sustained power generation. But the price has to be competitive and the technology tried and tested.

Currently, an Indian-designed nuclear reactor costs about 2 million euros per megawatt to build, which translates into 3.3 billion euros for a 1650 MW reactor. Flamanville has already reached a cost of 11 billion euros for the same capacity. 

Both governments will have to search really hard for any reason to justify a project that would cost at least three times as much, with unproven technology.

• Ranvir S. Nayar is managing editor of the Media India Group, a global platform based in Europe and India that encompasses publishing, communication and consultation services.
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