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Narendra Modi government may go slow on nuclear energy expansion: PwC

Tuesday, 27 May 2014 - 4:14pm IST | Agency: PTI
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The new government may put on the back-burner a plan to install 20 gigawatts of nuclear power capacity in the country by 2020 and instead focus on wind and solar to achieve energy security, says PwC. "Nuclear projects are not likely to be on the radar of the Modi government, at least for the next two years. It will first focus on increasing coal production, allocation and pricing, apart from clearing the balance sheets of distribution companies," PwC executive director energy utilities Sambitosh Mohapatra told PTI.

Rather than nuclear, the Modi government may focus on increasing wind and solar power capacity, especially when these models worked successfully in Gujarat, Mohapatra said. The power, coal, and new and renewable energy portfolios in the Modi Cabinet are held by Piyush Goyal, who is from Maharashtra, where BJP ally Shiv Sena was opposing the 9,900 MW Jaitapur nuclear project. Former Prime Minister Manmohan Singh had set a target of installing 20 GW of nuclear power capacity by 2020 and 63 GW by 2032.

In its election manifesto, the BJP promised to take steps to maximise the potential of oil, gas, hydel power, ocean, wind, coal and nuclear sources. The party said it considers energy efficiency and conservation crucial to energy security. It also promised to expand and strengthen the national solar mission and come out with a responsible and comprehensive National Energy Policy. The new government may reserve its policy decisions on nuclear energy as it had opposed certain measures taken by the UPA government, especially the Nuclear Liability Act.

The BJP plans to follow a two-pronged independent nuclear programme, unencumbered by foreign pressure and influence, for civilian and military purposes, especially as nuclear power is a major contributor to India's energy sector, according to the manifesto. The Ministry of Power had in a presentation said the top priority should be ensuring round-the-clock power supply and easing fuel shortages, along with taking steps to tap the country's hydro power potential, reform distribution and ensure the financial viability of distribution companies. It said environment and forest clearances to coal mines should also be mitigated.

However, the presentation did not speak about nuclear power and the steps the new government should take to ease norms on foreign investment in the sector as well as tweaking certain policy decisions to increase capacity. An industry expert from KPMG, who did not want to be identified, said that before the new government takes any decision on nuclear power, it will first have to tackle issues of supply chain, safety and acceptance from locals. "Wind, solar and hydro, on the other hand, are safe and tried models of clean energy. Though countries like Russia, Canada, the US, France and Japan are keen on investing in the country's nuclear energy growth story, the government, which is looking at FDI in power sector, will not take hasty decisions. "Instead it will go slow on this and meet its energy security target through other renewable sources," he added.


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