“Nuclear energy will meet India’s needs” - Erwan Hinault

April 30, 2015

In brief

 

“Nuclear energy will meet India’s needs”

Article by Erwan Hinault, Chairman and Managing Director, AREVA India, published in the magazine 'PowerWatch INDIA' - April 2015

 

"India has to explore all possible sources of power generation and, at the same time, reduce carbon emissions in a cost-effective manner. Nuclear energy is a suitable answer as the amount of energy generated by nuclear plants creates a considerable increase in the country’s total production, in a lowcarbon and reliable way. In the long run, the electricity coming from nuclear energy is also affordable, given the long lifespan and minimal, stable fuel costs. Nuclear is, therefore, perfectly adapted to India’s context and has to play a vital role in the country’s energy mix.

 

India has clearly understood the benefits of developing nuclear energy to support the country’s growth. Indeed, the country has a very ambitious and well thought-of three-stage nuclear programme for the development of indigenous technology. This has been planned over several decades, making India one of the earliest adopters of nuclear technology. However, the indigenous plan alone is insufficient to meet targets and sustain the country’s growth for decades to come. Therefore, India decided to collaborate with foreign suppliers for civil nuclear energy.

 

One of the key areas of recent discussion has been international cooperation in the Indian nuclear energy field. It has been a focus area for the government for several years now, and gradually relationships are taking concrete shape. India has shared a long history of collaboration with France, especially in technology and science. France, which is recognized worldwide for its expertise in the nuclear industry, has been a partner with India since the country opened up to foreign technology. In February 2009, AREVA, a French nuclear supplier, and Nuclear Power Corporation of India Limited (NPCIL) signed a Memorandum of Understanding that paved the way for an Indo-French partnership in nuclear power generation, to build up to six EPR reactors at Jaitapur in Maharashtra.

 

Nuclear safety first

Safety has always been, and remains rightly so, the main concern in the nuclear industry. India has a good nuclear safety track record and has taken proactive actions to suggest enhanced safety requirements in both existing and future nuclear power plants. For its new reactor projects, India has made safety a main feature when choosing designs and suppliers. For the Jaitapur Nuclear Power project, our company has proposed its EPR design, which is the only Gen 3+ design in the world that has been submitted and passed the European post-Fukushima safety checks. The layout of the EPR reactor offers unique resistance to a variety of external hazards, however unlikely, including earthquakes, an airplane crash, flooding, explosions, extreme temperatures or a combination of issues. The probability of core damage has been reduced by a factor of more than 10 as compared to previous generations of reactors.

With four EPR projects underway, our company is also gathering unique worldwide front-line experience in project delivery. These first-of-a-kind EPR reactors have already provided significant lessons learned, enabling optimisation and improvements during the construction of the two reactors in China. As a result, the reactors Taishan 1 and 2 are expected to be completed 40% faster than the two previous cases.

The Jaitapur Nuclear Plant project will benefit from a fully integrated approach, utilising the experience gained from all other EPR reactors. The company-wide feedback and capitalisation process, with more than 1,600 lessons learned captured and analysed, will help achieve our aim of building on time and on budget.

 

Cost competitiveness and localisation

The cost of electricity generated by nuclear power plants has sometimes been compared with the cost of electricity provided from other sources (coal-fired thermal plants, solar PV plants etc). However, these comparisons should only be made on levelised cost of energy (LCOE) basis, and not on capex basis.

Although nuclear plants have high upfront costs, they have a longer lifespan, higher availability and low, stable fuel costs. Further, its supply to the grid is highly reliable, baseload and continuous. The levelised costs of nuclear energy are competitive now and will remain so in the near future, and the cost of nuclear will become even more competitive with carbon emission pricing. It is also noticeable that among the many factors which affect the overall cost of nuclear power, the three most important are overnight costs, financing costs and the construction time of the nuclear power plant. So, as prices escalate with time, any delays in starting projects also affect the overall cost of generating power, making a comparison between the potential future cost of electricity with any current cost on the market irrelevant.

 

The government of India is looking to drive growth thanks to an ambitious industrial programme attracting foreign investors, “Make in India”. The nuclear energy sector can, and should, be an integral part of this programme which will benefit all the stakeholders by bolstering employment and industry in the country, reducing costs of many components and, therefore, improving the overall competitiveness of the projects. Present in India since 2008, AREVA has already established a strong business relationship with local suppliers to participate in existing projects in other parts of the world. For the Jaitapur project, we are working actively to maximise the share of components produced in India.

 

 

Looking ahead

Nuclear energy is one of the key sources to address India’s climate change concerns, uncertainty in gas and coal and increasing need to ramp up electricity generation. During the recent visit of US President Obama, it was announced that a solution has been found to operationalise the Indo-US Civil nuclear agreement in order to clarify certain sections of the CLND Act. This is a welcome development, and we look forward to having more details to see how it can be acceptable and applicable to all foreign suppliers.

 

The year 2015 has started on an encouraging note for the nuclear industry in India and will surely bring about positive changes to improve the electricity scenario of the country. France and India have extensive strategic cooperation in the fields of energy, defense and space. With the Jaitapur project, our company looks forward to take this relationship further and contribute to India’s drive towards energy independence."

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