Two years after the French energy company Electricite de France (EDF) submitted its techno-commercial offer for the construction of six nuclear power reactors in Maharashtra’s Jaitapur, talks between Indian and French officials over several issues, including liability, have not resulted in any breakthrough yet.
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According to sources in Delhi and Paris, the talks over the high cost of power per unit has also become a major issue in the conclusion of the agreement for the 9,900 MW project, which is the world’s biggest nuclear power generation site under consideration at present.
“The topic [of liability] has been discussed between the French and Indian governments and my understanding is that it is progressing towards convergence. It is a key topic for France and the EDF, and so this topic would have to be solved before any contract can be signed,” an EDF official said in response to a question from The Hindu, as part of a presentation to a larger group of international journalists invited to Paris.
The statement is significant, as in October 2022, the Minister of Space and Atomic Energy, and Minister of State in the Prime Minister’s Office (MoS PMO), Jitendra Singh, promised an early resolution to all the issues, within months.
“Dr. Jitendra Singh assured the France Minister that the technical, financial and civil nuclear liability issues will be resolved at the earliest by both the sides and well before the scheduled visit of the French President Mr. Emmanuel Macron in early 2023 as announced by [French Minister] Chrysoula Zacharopoulou,” an official press release stated. On April 24, the Minister’s office did not immediately respond to a request to comment on the latest position in the talks.
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PM to visit Paris in July
Mr. Macron put off his visit scheduled for March this year and is now expected to visit Delhi in September for the G-20 summit. However, Prime Minister Narendra Modi is expected to travel to Paris in July, and officials said they were attempting to “speed up” the talks between EDF and the Indian operator Nuclear Power Corporation of India Ltd (NPCIL). On April 22, 2021, EDF had submitted to NPCIL its binding techno-commercial offer to build six European pressurised reactors (EPRs) at Jaitapur. The offer was followed by a visit to India by senior EDF officials in May 2022.
The EDF official, who requested not to be identified, but spoke on behalf of the company, said that the issue, arising from India’s Civil Liability for Nuclear Damage Act that India passed in 2010, remains an item on the “agenda for both countries”. India’s CLND Act, which was brought in addition to the International Convention on Supplementary Compensation (CSC), is considered excessive by foreign companies, which could be liable to pay hundreds of millions of dollars in the event of a nuclear accident. As a result, despite signing civil nuclear deals with a number of countries, including the U.S, France and Japan, the only foreign presence in India is that of Russia in Kudankulam, projects that predate the Law.
A recent report in Al Jazeera also points to the fact that despite planning an insurance pool of ₹1,500 crores ($200 million) in 2015, the government’s ‘India Nuclear Insurance Pool” (INIP) has only been able to collect about half, ₹700 crore-₹800 crore, thus far. Concerns over safety after the 2011 Fukushima nuclear disaster, prompted Germany to switch off its last nuclear power reactor this month.
Another factor will be the time taken by the Jaitapur project, for which the original MoU was signed in 2009 with EDF’s predecessor Areva. In 2016, EDF and NPCIL signed a revised MoU, and in 2018, the heads of both signed an agreement on the “industrial way forward” in the presence of Mr. Modi and Mr. Macron. However, officials said nuclear projects do take time, pointing to EDF’s latest construction of an EPR in Finland, Olkiluoto 3. Its work began in 2005 and was completed after a delay of about 14 years, finally starting regular production on April 16 this year.
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Sources said India’s regulator, the Department of Atomic Energy (DAE), as well as NPCIL have also not yet signed off on EDF’s technical specifications for its EPRs, and the costing suggested was significantly high. When asked, the EDF official refused to comment on the cost per unit proposed in the offer, saying that no two nuclear project costs can be compared as “apples to apples”. The official also pointed to “specificities” in the Jaitapur project that have caused delays, including the land acquisition issues, NPCIL requirements, and the effort to coordinate government programmes like “Make in India” and “Skill India” so as to localise some of the construction.
(Inputs from Jacob Koshy in Delhi)
