Each reactor will have the capacity to produce 700 MW of electricity.

The Union Cabinet on Wednesday cleared the proposal to construct 10 indigenous pressurised heavy water nuclear reactors with a total capacity of 7,000 MW.

Briefing the media on the Cabinet decisions, Power Minister Piyush Goyal said the reactors each would have a capacity of 700 MW. “We already have 6,780 MW of operational nuclear power plants and about 6,700 MW of plants under implementation, which will be set up by 2021-22.”

The decision comes against the backdrop of recent troubles for India’s international collaborations in nuclear projects. While the U.S. deal involving Toshiba Westinghouse for six 1000 AP reactors is floundering after Westinghouse filed for Chapter 11 bankruptcy, the deal with French company Areva for reactors in Jaitapur remain mired in negotiations over costing.

#Cabinet approves construction of 10 units of Indigenous Pressurized Heavy Water Reactors. Read more: https://t.co/RCXtK98K3U pic.twitter.com/4zfR6YQpho — Frank Noronha (@DG_PIB) May 17, 2017

While the Minister said these 10 plants would create ₹70,000 crore worth of business for domestic manufacturers and generate about 33,400 jobs, he did not provide a timeline of their completion, saying the government would update the details when they are clear.

“The approval also shows our strong belief in the capability of India’s scientific community to build our technological capacities,” an official statement said.

Rapid advances by India

“The design and development of this project is a testament to the rapid advances achieved by India’s nuclear scientific community and industry. It underscores the mastery our nuclear scientists have attained over all aspects of indigenous PHWR technology.”

India generated 37,674 million units of nuclear energy in 2016-17, according to the Nuclear Power Corporation of India, at a capacity factor of 80%. The two major projects under construction at the moment are located in Rajasthan and Gujarat, of 1,400 MW each. Both plants, comprising two units of 700 MW each, are under review.

“The ten reactors will be part of India’s latest design of 700 MW PHWR fleet with state-of-the-art technology meeting the highest standards of safety,” it added.

The Cabinet also approved a new coal linkage policy called the Scheme for Harnessing and Allocating Koyala Transparently in India (Shakti) that will award fuel supply agreements (FSAs) to coal plants already holding letters of assurance (LoAs). Thermal plants holding LoAs will be eligible to sign fuel supply pacts under the new policy after ensuring that all the conditions are met.

“This government does not want to make any retrospective changes and so we have decided to honour the letters of assurance signed in the past,” Mr. Goyal said.

“The banks also approach us for this in the case of projects they had lent to on the basis of the letters of assurance.”

Future coal linkages under the new policy will be granted to central and state generation companies on the recommendations of the Ministry of Power.

“Those plants that have a power purchase agreement but not a fuel supply agreement, will have to bid on how much discount they would give in electricity supply,” Mr. Goyal said. “This discount will go to the distribution companies.”

“The future coal linkages for supply of coal to independent power producers without PPA shall be on the basis of auction where bidding for linkage shall be done over the notified price of Coal India,” the government said in a statement. “The LoA shall be issued to the successful bidders and FSA signed after meeting the terms of LoA.”

“India has the third largest reserves of coal,” Mr. Goyal pointed out. “Yet there are still 83,100 MW capacity of power plants that are dependent on foreign coal.

Governments of the past, instead of bolstering domestic capacity, set up such plants. This is why we still need to import coal because the technology of these plants needs only foreign coal.”

“Under the new policy, plants under implementation, plants already set up and plants to be set up in the future will all get coal,” he added.