A new report published by the Institute for Energy Economics and Financial Analysis has concluded that India’s plans to build 12 new nuclear reactors is economically unviable.
According to the new report (PDF), published this week by the Institute for Energy Economics and Financial Analysis (IEEFA), India’s current plans to build 12 new nuclear-powered plants is not only economically unviable, but fraught with risk, as the plants are intended to be a “first-of-its-kind” design that is untested. As such, the development of the nuclear power plants would likely result in numerous delays and technical problems.
David Schlissel, IEEFA’s director of resource planning analysis, concludes that the proposed nuclear plants, designed by Toshiba-Westinghouse and General Electric-Hitachi, and planned for the Mithi Virdi and Kovvada complexes, “are neither economically nor financially viable.” The plans intend for the 12 plants to be built across two separate sites in India. Six would be sited at Mithi Virdi in Gujarat, and would use the new Westinghouse AP1000 reactor design — which Schlissel notes has already “run into technical problems and significant cost increases and schedule delays” in other locations where the design is already under construction. The other six new plants, intended to be developed in Kovvada in Andhra Pradesh, would use GE’s Economic Simplified Boiling Water Reactor (ESBWR) design, and would be the first country in the world to develop this particular design.
“They would take much longer than expected to build, they would result in higher bills for ratepayers, and, if they are built, they might not work as advertised,” Schlissel said.
The report also noted that the development of the new nuclear power plants would come at the expense of solar, leading the author to conclude that India would do well to instead direct that money and effort into developing solar resources. “Investing in new solar photovoltaic (PV) capacity would be a much lower-cost, significantly less environmentally harmful and far more sustainable alternative to the Mithi Virdi and Kovvada projects,” Schlissel said.
Among the report’s specific findings:
- Capital costs of the 12 plants would far exceed those of comparable solar-energy projects and, barring long-term and probably unsustainable government subsidies, consumers will pay more for electricity from the plants than they would for solar energy
- The first new reactors in the expansions at Mithi Virdi and Kovvada will take 11 to 15 years to build, if approved, even assuming the projects manage to avoid likely delays. None of the new reactors at Mithi Virdi and Kovvada would generate any power for the electric grid until sometime between 2029 and 2032. The remaining units at each project are unlikely to be completed, if approved, until late in the 2030s
- Even without likely time-and-cost overruns, both projects would require massive investment over the next two decades, ranging from Rs. 6.3 lakh crores (US $95 billion) to 11.3 lakh crore rupees (US $170 billion). It is unlikely that the Indian government would be able to simultaneously support other electricity-sector expansions, including in renewable resources and energy-efficiency programs
- Both projects, if approved, would probably be slowed by lengthy land-acquisition delays, complicated liability issues, lags associated with new-technology difficulties and compliance with the country’s “Make in India” policy
“All of these can be expected to lead to substantial, and perhaps indefinite, delays and significant increases in capital costs, possibly even far beyond those we have assumed in our analyses,” Schlissel said.
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