India Prime Minister Narendra Modi has approved construction of 10 700 MW PHWR reactors in what is being called “a big boost” for his “Make in India” program of local sourcing of the supply chain.

With almost a quarter of India’s 1.2 billion population lacking access to reliable electrical power, the government’s actions will add almost 8 GW of nuclear power to the grid.

The program will require a massive infusion of people and funding for NPCIL, the state-owned nuclear energy utility. It is estimated to cost over $11 billion and is expected to create over 33,000 jobs.

It’s clear the government has lost patience not only with cost overruns and schedule delays by western reactor vendors for their own projects, but also with self-initiated domestic stumbling blocks including a brazenly stupid supplier liability law, entrenched bureaucracy hindering approval of new projects, and a lack of funding to build them.

Until now India sourced its PWR reactors from Russia which built and commissioned two 1000 MW VVER units at Kudankulam and has broken ground for two more. India and Russia are close to inking final terms and conditions for a 5th & 6th unit at the site in Tamil Nadu on India’s southern most coastal site.

The Indian government dithered for over six years with western nuclear reactor suppliers. Protracted negotiations with Westinghouse and Areva, which began almost a decade ago, have not resulted in projects breaking grounds with either vendor.

The government is keenly aware of massive cost over runs for Areva reactors under construction in Finland and France as well as problems with the financial collapse of Toshiba/Westinghouse.

Plans to build six EPR 1650 MW PWR type reactors at Jaitapur on India’s west coast have been clouded by cost overruns and schedule delays for EPRs under construction in Finland and France.

Plans to build six Westinghouse AP1000 1150 MW PWR type reactors on India’s west coast in Andhra Pradesh have recently crashed on the rocks of the bankruptcy filing in March and financial turmoil Japan’s Toshiba, its parent firm. Cost overruns and schedule delays in construction of four AP1000s in the U.S. have also served as caution lights for India’s energy policy makers.

Effects of Supplier Liability Law

But both Westinghouse and Areva also balked at committing to their respective projects because of the draconian supplier liability law enacted by PM Modi’s BJP parties. The law hindered western firms from entering the Indian market and it crippled the domestic nuclear industry.

As part of the announcement this week to build 10 new PHWR reactors, which use natural uranium, India’s government also reclassified Indian heavy industry firms as “vendors” thus exempting them from the supplier liability law. The law, which was pushed by India’s coal mining interests, was passed under the guise of seeking to prevent another Bhopal industrial disaster. Another element of support for the law was a desire for preservation of the country’s “nonaligned” status which favored use of an indigenous design.

Role for India’s Heavy Industry

This move to exempt domestic industry opens the way for India to develop a domestic supply chain of large long lead time components such as steam generators, pumps, and turbines. Unlike PWR reactors, PHWRs, based on AECL’s CANDU technology, do not need the same kind of large forgings for reactor pressure vessels. The ten new reactor units are expected to produce manufacturing orders worth over $11 billion and produce over 33,000 jobs in India.

The government believes that by relying on domestic manufacturing firms that it can produce economies of scale for all 10 reactors. Indian heavy industry firms such as Larsen & Toubro, Kirloskar Brothers, and Godrej & Boyce issued statements to the India news media welcoming the announcement. (See this slide deck for a presentation on L&T’s heavy industry capabilities, and certifications, to build PHWRs)

In 2017 the first supplies of uranium from Australia will arrive in India. Since the PHWR CANDU type reactors don’t require enriched uranium, the fuel for them will be readily available.

Challenges Ahead

The major challenges for the huge program include;

Funding the projects at about $1 billion each and placing orders for long lead time components.

The government must provide a detailed roadmap to industry to set the wheels in motion. Industry may be wary of promises of orders for manufacturing of components.

Streamlining the project approval process within NPCIL and for the government as a whole.

Ramping up its safety and regulatory oversight functions to cover 10 new reactors during their construction and commissioning periods and once they are in revenue service.

Training and deploying a construction workforce as well as future operators the plants

The 10 reactors are expected to be built at The 10 reactors will be installed in Kaiga in Karnataka (Unit 5 and 6), Chutka in Madhya Pradesh (Unit 1 and 2), Gorakhpur in Haryana (Unit 3 and 4) and Mahi Banswara in Rajasthan (Unit 1, 2, 3 and 4).

Note that many of these reactor projects have been in the planning stages for years, and the BJP party actually opposed their development when the party was out of power.

Future Domestic Reactor Designs

Separately, the Hindu reported on May 19th that reactor designers at Bhabha Atomic Research Center, working with NPCIL, have completed a design for a 900 MW PWR type reactor that uses enriched uranium fuel (3-5% U235). In 2015 the IAEA posted a slide deck with the technical details of the planned 900 MW PWR type reactors.

Overall, the Hindu reports the government’s longer term plans are to build 28 of these reactors with a total capacity of 25 GW over the next 15 years.

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