The Department of Atomic Energy was not the driving force behind the India-U.S. nuclear engagement.
IN the wake of the Left parties opposition to the negotiated 123 Agreement, which will form the basis for India-United States civil nuclear cooperation, efforts by the government to emphasise its importance for the energy security of the country are in evidence. Prime Minister Manmohan Singh has used all available opportunities to dwell on the role of nuclear power in our energy security and the necessity of the India-U.S. nuclear deal to realise that role. While nuclear power will be critical for the countrys long-term energy security, and our indigenous three-stage nuclear power programme has been evolved from that perspective, it is important to understand that the nuclear deal cannot be central to achieving that. Indeed, Anil Kakodkar, Chairman of the Atomic Energy Commission (AEC), has always maintained that any import of nuclear power that may become possible following the India-U.S. nuclear agreement will only be an additionality to the long-term projections for the installed nuclear capacity under the indigenous programme.
The current installed nuclear capacity from 17 reactors is 4,120 MWe, accounting for 3.2 per cent of the total installed electrical capacity of 127,750 MWe at the end of the Tenth Plan. This includes the two imported 160 MWe Boiling (Light) Water Reactors (BWRs) at Tarapur built in the 1960s by General Electric to kick-start the nuclear programme; the 300 MWe twin Pressurised Heavy Water Reactor (PHWR) systems built at Rawatbhatta, Rajasthan, in the 1970s with Canadian assistance; the 11 indigenous 220 MWe PHWRs; and the two indigenous 540 MWe PHWRs. There are five reactor projects under construction: three 220 MWe indigenous PHWRs and the 21,000 MWe Light Water Reactor (LWR) system being built under Russian cooperation at Kudankulam in Tamil Nadu. These will add 2,660 MWe to the installed capacity by 2008. While the PHWRs use natural uranium (which has only 0.7 per cent of the fissile isotope uranium-235), and form the mainstay of the Indian nuclear programme, the imported LWRs/BWRs use uranium enriched to 3-4 per cent of U-235.
The three-stage Indian nuclear programme is based on the premise that exploitable uranium reserves in the country can generate only 10,000 to12,000 MWe through the PHWRs but the plutonium derived from the spent fuel of the PHWRs is sufficient to drive the second stage of the programme, which is based on fast breeder reactors (FBRs). The programme has already entered its second stage with the upcoming 500 MWe Prototype Fast Breeder Reactor (PFBR) at Kalpakkam, which should become operational by 2011. Besides breeding more plutonium than they burn, the FBRs will also turn the fertile thorium (Th-232), of which India has abundant reserves, into fissile uranium-233 when it is used as a blanket to the reactor core. The U-233-based Advanced Heavy Water Reactors (AHWRs) whose indigenous design and development is already at an advanced stage will operate in a self-sustaining fuel cycle of burning U-233 and converting Th-232 into U-233. Thus, this forms the basis for long-term energy security, and nuclear power generation will be completely delinked from the limited availability of natural uranium.
The PHWR base by the end of next year will thus be 4,460 MWe, and to complete the first-stage target of 10,000 MWe, 8 700 MWe PHWRs (instead of the original plan of 10 540 MWe PHWRs) have been proposed for the Eleventh Plan. However, given the construction period, these are likely to become operational only during the Twelfth Plan. As such the Department of Atomic Energy (DAE) envisages only an addition of 3,160 MWe the 3 220 MWe PHWRs, the 2 1,000 MWe Russian LWRs and the 500 MWe PFBR during the Eleventh Plan. The total installed electricity capacity by the end of the Eleventh Plan is projected to be about 195,000 MWe, which means that the nuclear component (7,280 MWe) will be 3.7 per cent. Total generation by the end of the Twelfth Plan (2012-17) is projected to be 275,000 MWe, of which the nuclear component will be 13,880 MWe, which includes 2 500 MWe FBRs, accounting for about 5 per cent.
The target set by the DAE at the turn of the century for the year 2020 is 20,000 MWe, which interestingly includes 61,000 MWe LWRs through imports besides the 21,000 MWe Russian VVER units already being implemented at Kudankulam. This was apparently based on the early Russian offer to build six more VVERs at the same site. But given the current international nuclear trade regime, which does not at present allow India to gain access to the world market, this is unrealistic. Therefore, the DAE will be able to add two more 500 MWe FBRs, as originally planned, and achieve 14,880 MWe by 2020 as against the target of 20,000 MWe. The target can be achieved through imports only if the consortium of Nuclear Suppliers Group (NSG) countries relaxes its export guidelines following a successful India-U.S. nuclear cooperation agreement.
However, if the international market opens up, the additionality that the DAE has currently planned for is only 10,000 MWe, plants for which are likely to be set up during the Twelfth Plan. This would include two more 1,000 MWe units at Kudankulam itself, for which a memorandum of intent was signed between Russia and India early this year. In addition, the National Thermal Power Corporation (NTPC) has plans to get into the nuclear area and import an additional 2,000 MWe of nuclear power. This would mean that the nuclear capacity during the Twelfth Plan would become 25,880 MWe instead of the 13,880 MWe envisaged on the basis of the indigenous programme alone (or equivalently, 26,880 MWe against 14,880 by 2020). This amounts to about 9 per cent of the total generation capacity. From this perspective, five other potential coastal sites have also been identified over the last two and a half years. These are Jaitapur in Maharashtra, Mithi Verdi in Gujarat, Kovvada in Andhra Pradesh, Pati Sonapur in Orissa and Haripur in Bengal.
From an energy security point of view, a less than 10 per cent nuclear contribution cannot be termed critical. It stands to reason, therefore, that the India-U.S. nuclear agreement and consequent import contribution to nuclear capacity cannot meet near-term energy needs. If there is no import contribution, it is certainly possible to live with a 5 per cent nuclear component. As many have argued, it may be prudent to import coal and natural gas and implement new thermal and gas-based projects to meet energy needs in the short and medium term. A slower nuclear growth path than what is required to meet ad hoc targets is certainly acceptable as long as one is reasonably sure that the third stage of the nuclear programme for long-term energy security, which is based on the Th-232/U-233 cycle, is achievable. According to the DAE, even with an indigenous programme, a nuclear generation capacity of over 100,000 MWe by 2040 and over 200,000 MWe by 2050 is achievable, which will set the stage for sustained high growth based on the thorium cycle.
Imports would become necessary only if the second stage, based on the FBRs, does not succeed as envisaged and consequently the third stage fails to take off. The only option would be to expand the thermal nuclear power base, based on the PHWRs and LWRs, beyond 10,000 MWe using imported uranium natural and enriched and imported LWRs. But without a closed-fuel-cycle-based programme, which utilises plutonium extracted from breeders and eventually the large thorium resources, a high nuclear growth path and hence long-term energy security will not in any case be possible relying predominantly on nuclear power. So from this perspective, imported nuclear power is not essential. If some additional power can come in without any attendant constraints and national policy-related compromises, it would be acceptable. However, in the opinion of the Left parties, there would be many adverse strategic and geopolitical implications if the India-U.S. nuclear agreement is concluded in the form it has been negotiated, and the deal cannot be viewed in isolation, especially when it is not critical to energy security.
From the DAEs perspective, the international market, if accessible, was an option not for technology or for nuclear energy but to overcome the uranium crunch that the programme has been experiencing for the last few years, forcing the PHWRs to operate on reduced capacity factors (60-65 per cent) to save fuel (see graph). But this crunch has arisen essentially because mining operations have not kept pace with the expansion of the programme, with short turnaround times (of around five years) and the highly improved performance (with nearly 90 per cent capacity factors) of the indigenous PHWRs. Some of the old mines in Jaduguda (Singbhum district, Jharkhand) were shut down and no new mines were opened in Jharkhand or in other exploitable sites in Andhra Pradesh and Meghalaya owing to lack of government funding on the one hand and public opposition on environmental grounds on the other. Also, the domestic uranium ore is of poor quality (0.07-0.1 per cent uranium content) and the cost of producing uranium is hence a great deal more than the cost of buying it (at international prices).
(One other reason was the shortage of enriched uranium to run the U.S.-built LWRs at Tarapur. India does not have adequate uranium enrichment capacity at its Mysore plant. However, as in 2001, Russia came to the rescue once again and in early 2006 supplied 50 tonnes of fuel on the grounds of operational safety which NSG guidelines permit. Thus, the immediate Tarapur problem was obviated, albeit until the consignment runs out in a few years time. But this is not a critical issue as loading with mixed oxide (MOX) fuel up to 10 per cent has already been experimented with and, according to experts, higher MOX loading (even full) can be done. At the same time, work can be carried out to increase domestic enrichment capacity. Also, since India has reprocessing rights over Tarapur spent fuel, reprocessing should be undertaken. Plutonium from it can be used for MOX, and the depleted uranium (still good enough for the PHWRs) can be used to fuel the two safeguarded PHWRs in Rajasthan, thus partially offsetting the natural uranium squeeze.)
However, the uranium squeeze is likely to ease very shortly. Just two months ago, a new mill, with a capacity of 3,000 tonnes a day, was commissioned at Turamdih in Jharkhand to process mined uranium ore. The existing mill at Jaduguda can process 2,190 tonnes. In addition, a new open-cast mine was opened at Banduhurang in Jharkhand, and the foundation for a new underground mine was laid in Mohuldih. The current requirement of natural uranium for the PHWRs is about 600 tonnes a year and the current production is less than half that. However, the augmentation made will ease the crunch significantly in about six months, say DAE officials. According to R.B. Gupta, CMD of Uranium Corporation of India Limited (UCIL), in all, roughly Rs.3,100 crore will be invested to open new mines and set up processing plants in Jharkhand, Andhra Pradesh and Meghalaya. In Jharkhand alone, Rs.650 crore is being invested. According to Kakodkar, an investment of Rs.1,800 crore is proposed for setting up two uranium mining and milling plants in the Nalgonda and Cudappah districts of Andhra Pradesh.
Thus, the driving force behind the India-U.S. nuclear engagement was not the DAE. Where did the push come from? Consider the following passage in the Mid-Term Appraisal (MTA) document for the Tenth Plan released in May 2005, two months before the George W. Bush-Manmohan Singh joint statement of July 18, 2005: Given the limited indigenous uranium resources, India must seek at least 20,000 MWe of additional [over and above the 20,000 MWe target by 2020 of DAE] nuclear power ca pacity on a turnkey basis, based on a competitive power tariff, to be built over the next 10-12 years [emphasis added]. Alternatively, India must seek nuclear fuel on competitive terms for a similar level of capacity to be built by NPC IL in the next 12-15 years.
What is the basis of this additional 20,000 MWe? It is an arbitrary figure pulled out of a hat. How did the Planning Commission make such a recommendation when it knows that all the doors to external sources of nuclear technology are closed under the existing non-proliferation regime? Or was the commission aware of things to come before May itself? We may note here that Montek Singh Ahluwalia, the Deputy Chairman of the Planning Commission, is also Co-Chair of the India-U.S. Joint Working Group on Energy.
But, more pertinently, is it feasible at all? Notwithstanding the shorter gestation periods and the creditable performance and profitable operations in recent years of Nuclear Power Corporation of India Ltd. (NPCIL), it is unlikely to be able to install 20,000 MWe in a 12 to 15-year time frame. Large-scale import of LWRs, if possible, seems to have been on the governments agenda well before July 18, 2005. It is indeed surprising, considering there was no indication of this in the Tenth Plan document, that nuclear power has suddenly assumed centrality in the Planning Commissions scheme of things for energy security.
The explanation for the apparent shift in focus to nuclear power is that the commission has suddenly realised de-carbonisation in the energy sector as an important criterion. If that is the case, the government should be more willing to initiate appropriate measures to support the indigenous programme through adequate funds so that it can realise the normal envisaged growth. The Comptroller and Auditor General of India observed in detail in 1999 that one of the main reasons for the DAE falling well short of the original target of 10,000 MWe by 2000 was the large shortfall in government funding from the late 1980s through to the 1990s (see Frontline, January 21, 2000). It is perhaps not out of place to point out that during this critical phase of insufficient budgetary support, Manmohan Singh was the Finance Minister and Montek Singh Ahluwalia was the Secretary for Economic Affairs (from 1991 to 1993) and Finance Secretary (from 1993 to 1998) under the Narasimha Rao government. Strangely now, in their new-found faith in nuclear power, they are championing the cause, but through imports!
Let us look at how much importing 20,000 MWe of nuclear power will cost. At a high capital cost (of nearly $2 million/MWe without the interest during construction on the borrowed amount), importing would be much costlier than the capital cost of indigenous PHWRs at about Rs.7 crore/MWe. The price of processed and fabricated uranium fuel, is, in fact, a very high $1,625/kg. A 1,000 MWe LWR requires nearly 1,000 tonnes of uranium fuel over its lifetime, which means an additional $1,625 million over the $2,000 million capital cost, if fuel is to be stockpiled for a lifetime to avoid disruptions in supply as envisaged in the 123 Agreement.
Even assuming that such large resources can be raised through the market, the money would be better spent in implementing a wider base of the PHWRs and in increasing production of domestic uranium resources, both natural and enriched, by opening up new mines and increasing milling, processing, enrichment and fuel fabrication capacities to consolidate the indigenous nuclear base for long-term energy security.
Besides, of course, such import-led nuclear power growth has the danger of marginalising the indigenous programme and R&D base built so assiduously over the years.
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