Tag Archives: EPR

Questions over Jaitapur

12 Sun Apr 2015

Posted by in Europe, France, India, South Asia

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In the hullabaloo over the fluctuating fortunes of the Rafale fighter aircraft during Prime Minister Narendra Modi’s visit to France, little attention has been given to the developments in the Jaitapur Nuclear Power Project. Inked in 2010, the project inched forward during the state visit after the French nuclear concern, Areva, signed an agreement with the state-owned Nuclear Power Corporation of India Limited and a memorandum of understanding with Larsen & Toubro related to the construction of the power plants. The JNPP is estimated to cost $18 billion and host six Generation III+ EPR reactors of 1,650 MW each. With a total power generation capacity of 9,900 MW when complete, Jaitapur will trump Japan’s Kashiwazaki-Kariwa (8,200 MW) to become the world’s largest nuclear power plant.

The movement on Jaitapur signals that the logjam on the issue of nuclear liability has been resolved to the satisfaction of foreign nuclear vendors, however wasteful, self-defeating, and unnecessarily convoluted the idea of a nuclear suppliers’ insurance pool may be. The agreements signed between the Indian and the French sides will go towards resolving some of the difficulties in the negotiations so far. Areva has moved forward with a pre-engineering agreement with NPCIL that will allow India to assess and license the EPR reactor as per Indian laws and regulations. The commencement of the licensing procedure in parallel to the negotiations on cost, manufacturing, transfer of technology, and other matters will expedite the project when it comes time for the final agreement to be signed. Areva has also entered into an agreement with L&T to source heavy engineering components such as reactor pressure vessels and steam generators as well as electrical equipment, valves, and pipes. A technical team from Areva recently visited the L&T heavy forging facility at Hazira after which they developed confidence that these components could be manufactured in India. Progress between Areva and L&T will also reduce the lead time once construction starts full swing. Such localisation will not only lower costs but also enhance L&T’s existing capabilities. This is an important development which will give the company an edge in bidding for contracts in the 1,530 MW GE-Hitachi reactor complex planned for Srikakulam and the Westinghouse AP1000 reactors at Mithi Virdi. Furthermore, with the agreement on civil nuclear cooperation between India and Japan stalled, L&T’s expanded skill set will come very handy for the Indian nuclear industry.

Despite several reasons to be pleased with the progress on Jaitapur, one substantial question remain unanswered – that of the EPR reactor itself. Initially called the European Pressurised Reactor but then internationalised to Evolutionary Power Reactor and now finally just the ‘EPR,’ the reactor was jointly designed by Areva (then Framatome), Electricité de France, and Siemens AG. The design is substantially safer than most commercial power reactors that are presently operational in the world – it can withstand seismic disturbances and has the ability to tolerate a direct plane crash. Furthermore, it has 400 per cent redundancy in its safety and cooling systems as well as a core catcher in case of a meltdown. The reactor generates 15 per cent less long-life radioactive waste products and operates on several types of fuel – enriched uranium, mixed oxide fuel, and reprocessed uranium – and does so at a better efficiency than previous generation reactors. This makes the EPR cheaper to operate and maintain. What makes pressurised water reactors like the EPR attractive to India is that the country maintains a small fleet of CANDU reactors which can accommodate spent PWR fuel as its primary fuel in what is known as the DUPIC (Direct Use of PWR fuel In CANDU) fuel cycle with only physical reprocessing and skipping the more expensive chemical processes.

This bag of goodies, however, has a large question mark hanging over it – no one has managed to successfully construct and operate an EPR reactor yet. In fact, the tales of delay from construction sites around the world where EPRs are being erected – Olkiluoto, Flamanville, and Taishan – should deter anyone from choosing the French reactor. The projects in Finland and France are severely behind schedule and in China, Areva is concerned that safety procedures may not have been assiduously followed. One wonders if countries such as France that are synonymous with the success of nuclear power, advanced industrial states like Finland, and manufacturing powerhouses like China are struggling to build an EPR to safety standards, what chance does a novice in nuclear construction and lightweight in industrial manufacturing like India have to build the reactor on time and on specification?

None of the problems with the EPR construction have been due to faulty design. In fact, India can rest easier after the many lessons that have been learned from the other sites. There are none that cannot be overcome and most are fairly simple though with expensive consequences. At Olkiluoto, for example, trouble started with the pouring of concrete for the base slab itself. There were several non-conformities that came to the attention of the safety inspectors and eventually, the concrete batching plant itself had to be redesigned. The reasons for this, an investigation revealed, were manifold. First, there was no “appointed responsible manager at the site unambiguously in charge of the base slab fabrication, with authority to issue orders that are binding to all parties.” Second, the crew at different phases of fabrication did not have a common understanding of nuclear safety. Third, the concrete supplier was not made explicitly aware of the requirements of nuclear-grade concrete at the time of tender invitations. Four, the fabrication staff was not trained in special methods and quality standards required in manufacturing nuclear-grade concrete. Five, the problems observed in concreting operations were not always immediately addressed. Six, there was a communication problem on quality assurance, fabrication of material, and the design of the mix composition. Seven, in quality control, too much trust was placed on the responsible attitude of the parties in the elimination of the detected problems. In the manufacture of the steel container lining, the welds between the various steel plates were found wanting; repairs were conducted using unapproved methods for nuclear construction; segments had to be redesigned and rebuilt; due to lack of communication, the design modifications at one phase were not accounted for in the next phase and modifications had to be made in the next phase as well.

Similar but fewer problems were faced at Flamanville and fewer still at Taishan. This was because of the enormous amount of learning that happened at Olkiluoto. While the project is routinely cited as an example of a disaster in nuclear engineering by the media, safety inspectors and regulators at Areva, EDF, and STUK, the Finnish safety regulator, are actually proud of all that has been learned and how incident discovery and resolution occurred in a highly professional manner. Teollisuuden Voima Oyj, the Finnish nuclear consortium, was made painfully aware that the nuclear industry had lost a lot of talent since the 1970s and 1980s to retirement and stagnation. Thirty years ago, vendors were large and experienced firms that could design and manufacture almost all parts of the nuclear power process in-house. This obviated the need for subcontractors and quality assurance was unified and easier. A moribund industry saw vendors downsize and bleed talent to other sectors. As a result, the recent nuclear renaissance is built on the backs of dozens of subcontractors who are not trained to understand the higher standards demanded by nuclear construction. This makes quality assurance and a collective safety culture difficult to implement and enforce.

The loss of skill has affected nuclear vendors in more ways than just through unqualified subcontractors – mistakes are made in routine tasks even in-house. The work at the Flamanville plant, for example, was recently overhauled for concentrations of carbon above the regulatory limit in the steel of the reactor pressure vessel. While the larger vessel was forged by Japan Steel Works, probably the only forge in the world that can process the ingots required for the EPR, the smaller plates in which flaws have been found were made by Areva itself at its plant in Le Creusot.

Olkiluoto has taught Areva that the earlier the licensee, regulator, and contractor start talking to each other, the better. The project should be mapped out as much as possible before work begins and everyone should know how they fit into the larger picture. This handholding is required especially of new subcontractors who have little experience in nuclear work and do not understand how modifications they might make can have severe consequences downstream. Furthermore, advanced construction and manufacturing techniques are difficult to perform if not regularly practiced. Areva should have ensured that the subcontractors understood the higher degree of workmanship that would be required of them before hiring them for the Oilkiluoto project. When working with such an inexperienced crew, Areva should have also been realistic about the time estimated to complete each stage of the project.

Some of these lessons have already been incorporated. At Taishan, for example, 50 per cent of the management and engineering staff and 90 per cent of the procurement officials from Areva’s side were Olkiluoto and Flamanville veterans. The site has had the least problems or delays as a result. Applying these lessons to Jaitapur will certainly ensure that the project does not run into interminable delays. The cooperation between L&T and Areva is good news but India also suffers from a small pool of relatively inexperienced nuclear contractors. The price for nuclear stagnation world over has been steep and to avoid paying it now would only make it steeper in the future.

The processes for manufacturing, construction, procurement of mechanical components, and quality and safety standards must be set in stone before work commences if India is to avoid another Olkiluoto. In an era where financing costs are higher than material costs, delays could wreck a project’s viability. At a time when India needs to be talking about hundreds of nuclear reactors and not dozens, a misstep like Olkiluoto or even Flamanville could grievously damage the reputation of the fledgling nuclear industry as well as the technology itself. India’s operator, regulator, and contractors must be vigilant, especially since a reactor of this type is yet to be successfully built.

The Economics Of Nuclear Energy

28 Fri Nov 2014

Posted by in India, Nuclear, South Asia

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At the recently concluded India Economic Summit, Minister of State with independent charge for Power, Coal and New and Renewable Energy Piyush Goyal asked what the lifecycle cost of nuclear energy was. To nuclear aficionados, this was like asking how much a car costs. As anyone can attest, such a seemingly simple question can start a chain reaction of other queries. Which category? Which brand? Where? With or without bucket seats? Leather interior? Sunroof? Seat warmers?

This is not to put down the minister but to reveal the many variables that go into nuclear costing. In fact, it should be applauded that such questions are finally getting attention from the ministerial class in India. However, there is a reason the minister could not get a straight answer. It was not a straight question.

Nuclear costing is a complex enterprise that is made more difficult by doctrinaire hatred for it in some sections. The most reliable method is to calculate the cost of each nuclear facility individually. This may seem a bit of a chore but given that the number of nuclear sites in India will remain under 50 in the foreseeable future, the task is not so daunting. However, to give a broad picture of what variables affect nuclear lifecycle costs, the life of a nuclear facility can be broken down into four stages: Initial ground work; Construction; Operations and Waste Storage, and Decommissioning.

Initial ground work

This stage entails finding a place suitable for a nuclear power plant. Surveyors sent out to consider different sites consider, among other things, availability of land, topography, who the likely consumers of electricity in the region are, epidemiological data, the distance of the potential nuclear site from its likely consumers, rainfall, wind patterns, water sources, background radiation, and risk of natural disasters like earthquakes, tsunamis, or tornados. Normally, sites under consideration are monitored for two years before the process of land acquisition and construction is even started, but over time, this can be partially reduced as a database of surveyed sites builds up and updates to account for population migration and its impact can be made periodically.

Construction

This is the most complex stage in terms of accounting. Various factors play into the cost at this stage. The first is the cost of the land acquired and the compensation given to affected people. This varies from site to site and even a ballpark figure is difficult to estimate. Nonetheless, land requirements for nuclear power are the least per gigawatt generated.

The crux of it all is what a reactor will cost. This will depend on type of reactor, vendor, and size. For example, a 220 MW Pressurised Heavy Water Reactor from the Nuclear Power Corporation of India is likely to cost much less than Westinghouse’s 1,000 MW AP1000 or Areva’s 1,650 MW EPR. These variations will be even greater if different types of reactors – beyond lightwater – are considered, such as the Indian workhorse, the CANDU, or the Fast Breeder Reactor, the Liquid Fluoride Thorium Reactor, or India’s Advanced Heavy Water Reactor, though these last three are presently still in the research phase. The cost will also be determined by what subsidies the government may have given to encourage investments in nuclear energy. Or conversely, what discounts the vendor may offer to secure greater sales; South Korea and China, for example, are keen on breaking into the reactor export market but have so far enjoyed only limited success.

Another factor is how the reactor will be built. Components built indigenously are usually cheaper, but in this nascent industry, they may turn out to be more expensive. Yet nuclear vendors usually have semi-rigid supply chains which allow some sort of price approximation. However, India is known to insist on certain offsets to acquire new technology as well as reduce costs. These offsets cloud off-the-shelf rates of reactors and its components. India has cheap labour, but this only extends to manual labour. Professional skilled labour costs will remain high as the designs are all conceived in Europe and the United States where labour prices are much higher.

Where a reactor is constructed determines what sort of safety measures will have to be considered. Units close to the coast may have features to mitigate the impact of a tsunami while those further inland may have to guard against a higher Maximum Credible Earthquake rating, flooding, or other risks. This also affects costs.

The most important component of construction costs is the improvements in safety that have been mandated over the past 30 years. It is—as usual—difficult to get Indian data, but French and American experiences can be used as a general model.

Of course, nuclear power is among the most capital-intensive energy sources out there. From the early 1970s to the late 1980s, construction costs of reactors rocketed up over 1000%. Even adjusting for inflation, nuclear construction costs were seven to eight times higher than they used to be 15 years earlier. Philadelphia Electric Company (now a subsidiary of Exelon) constructed its Peach Bottom facility of two reactor units in 1974 for $2.9 billion (in 2007 dollars) but just the first of its two Limerick units, completed in 1986, cost $7.3 billion.

The plant at Dresden, Illinois, was completed in 1970 at $146/kW while the Braidwood plant cost $1,880/kW in 1987—a 13-fold increase in 17 years. The price of electricity in Millstone, Connecticut, rose by a factor of 22 in the 15 years between the commissioning of the first reactor and the third. The Nuclear Energy Agency estimates these costs to have risen even further to $3,850/kW in 2009.

The French experience is identical; the price of nuclear reactors doubled between 1980 and 2000. The French national audit body, Cour des comptes, has estimated the Flamaville EPR to cost around $4,600/kW.

These examples demonstrate that the high price of modern-day nuclear construction cannot be due to incompetence as some suggest unless we allow for our ineptitude to have mysteriously appeared only since the 1970s. Studies show that two things happened in the 1970s to raise the price—the cost of labour went up and it took longer to build nuclear facilities. In the US, cost of labour went up 18.7% from 1976 to 1988; in fact, labour costs went from being less than material costs to being twice as much.

The second reason for the price escalation was that nuclear power plants took longer to build. When construction time increased, money was borrowed by the promoters for a longer tenure and generated more interest to be paid back. In the early 1970s, it took about five years to complete a new build but by the end of the decade, that had more than doubled to average around 12 years. Admittedly, the 1970s were a period of high inflation due to the oil shock and weak economic performance around the world, but in effect, the price of a nuclear power plant tripled over that decade with 69% of the increase being due to inflation and interest payments.

Regulatory ratcheting

What caused the construction delays? The answer may upset some but the primary reason was stricter regulatory standards. According to a study done at Oak Ridge National Laboratory, between the early and late 1970s, regulatory requirements increased the quantity of steel needed in a nuclear power plant by 41%, concrete by 27%, piping by 50%, and electrical cable by 36%. The time taken for prep work went from approximately 16 months in the late 1960s to 54 months by 1980 and actual construction time went from 42 months to 70. The price of a plant quadrupled.

Similarly, labour costs were affected as regulations were sometimes changed in the middle of construction and modifications had to be applied retrospectively. More inspections and tests became required, leaving senior engineers idle as regulators double- and triple-checked every system. In some cases, changes ordered involved altering the basic layout of a subsystem or removing concrete that had already been poured. These were difficult and expensive procedures.

Activists resorted to legal action or protests to delay construction. False experts would write in local newspapers and agitate the community; after all, with so much new regulation, it was easy to  allege impropriety at some stage or another. At times, populist pressure was brought to bear on local mayors or governors who refused to cooperate with the nuclear facility in emergency evacuation drills. Eventually, the Nuclear Regulatory Commission had to change the rules to allow plants to be commissioned without a complete testing of evacuation procedures.

Quality assurance gone wild

This regulatory ratcheting does not mean that nuclear plants necessarily got safer—more piping may added redundancy but also a greater possibility of leaks; more electrical cable meant more back-up but also a greater chance of short circuits. One can always increase the safety of a product but if the cost exceeds the benefit, it defeats the purpose; the product becomes unaffordable.

Much of the regulatory tightening was spurred by fearmongering anti-nuclear activists with little understanding of nuclear engineering. To draw a parallel with the automotive industry, we could make cars safer by making them heavier, adding more shock-absorbent bumpers, airbags, rear window wipers, fog lights, anti-lock brakes, and so on. But this would make cars prohibitively expensive to buy or operate; it would kill the industry.

Having supplier qualifications and requirements for component fabrication that far exceed those applied to any other industry leads to dramatically higher costs. Plus, the number of qualified suppliers is reduced, causing supply bottlenecks, low manufacturing, and a bidding war for components. Instead, if the nuclear industry were to follow a more typical set of quality requirements such as the ISO-9000, many blockages would vanish, increasing manufacturing capacity and introducing healthy competition, in turn lowering the price of labour and material.

Having an extremely rigid and bureaucratic regulatory system also means that even sensible changes are delayed. Due to the difficulty in getting approval, there is reluctance to make modifications and innovation is stifled. Quality assurance must be based on probabilistic risk assessments rather than ill-informed public fear or symbolism. It is vital to understand that over-engineering a nuclear power plant is meaningless if the human factor cannot be resolved. In virtually all nuclear accidents, it was the human factor at fault, not material or systems failure.

Operations

Operational costs are comparatively low for nuclear power plants. The very high energy density of uranium allows it to be transported easily and in quantities smaller than coal by at least an order of magnitude. Greater energy density also means that price fluctuations do not affect the cost of electricity as calamitously as they would for fossil fuels. For example, if the spot price of uranium rose from $25 to $100 per pound in a week, the extra $75 dollars would be spread over a greater amount of energy available in a pound of uranium. However, imagining the same scenario for oil—$75 spread over the energy in one barrel of oil—is the stuff of nightmares and apocalyptic novels.

The potential fluctuations in cost at this stage, like the prep work stage, are minimal and depend on the price of fuel and plant load factor. Due to shortages in fuel and/or moderator, Indian reactors used to run at 35-55% efficiency. With easy availability of fuel since the Indo-US nuclear deal, they have been able to increase capacity to nearly international standards. In fact, Unit V and the Rajasthan Atomic Power Plant set a world record in continuous running at a load factor above 90%. This will vary the cost of operations, but again, not substantially.

Another operating cost is liability insurance. The Civil Liability for Nuclear Damage Act has raised this cost by opening suppliers to prosecution as well as operators, the wisdom of which has been argued elsewhere.

Waste Storage

Spent fuel from the reactor must be stored somewhere for safe disposal. This is usually done on-site until the irradiated fuel rods can be safely transported to a more permanent geologically secure depository. India does not have such a depository yet as it has not burned enough nuclear fuel to warrant the construction of such a facility. Indian nuclear power plants, therefore, store the spent fuel on the premises.

However, the variations in cost in this phase of the nuclear lifecycle come from somewhat unique Indian jugaad solutions to the problem of fuel shortages. Indian reactors have long experimented with mixed oxide and reprocessed fuel to reduce the consumption of natural uranium. The CANDU reactors that comprise most of India’s nuclear fleet are adept at handling different fuels with slight modifications in the fuel assembly. The advantage of using such unconventional fuels is that more energy is extracted from the fuel and there is much less waste to store. Although reprocessing costs are high, it could be offset by reducing the need for enrichment of fresh fuel and producing significantly smaller quantities of waste.

Decommissioning

Decommissioning costs are usually about 12% of the initial capital cost of a nuclear power plant. If a small percentage of the revenue per kilowatt-hour generated were put aside, the plant operator would hardly notice it. In the US, decommissioning cost amounts to less than 5% of the cost of electricity produced. Furthermore, with modern nuclear plants capable of functioning for 60 or even 80 years with the help of a midlife refurbishment, the cost of decommissioning can be collected over a much longer period and would therefore be an even smaller portion of the cost of electricity generated. Though the cost of decommissioning will show little variation, the lifetime of a reactor will determine the rate at which it can be accumulated.

Power economics

With so many variables in play, it is difficult to estimate a comprehensive cost of nuclear power over its entire lifecycle. However, the large upfront capital costs are used to scare politicians from committing to nuclear energy. Yet, a fair analysis would emerge only if these stated costs are compared fairly across several parameters. These include cost per gigawatt generated, cost per capacity factor, cost per lifespan of a facility, and cost per tonne of carbon emission. Despite the high initial costs, nuclear power emerges very favourably. However, if States are still afraid of multi-billion dollar investments in nuclear power, the industry has also developed Small Modular Reactors. If one is willing to sacrifice some economy of scale, these reactors are much smaller and offer flexibility in output and geographic distribution.

The issue raised at the WEF was not about the advantages of nuclear power or its safety and these issues have been ignored in this article. The purpose here was to highlight the numerous variables that influence the final price of nuclear power and to explain the reasons for the spike in prices of some of these factors. The only way to talk sensibly about nuclear costing is to do it individually by facility and not collectively. However, only talking about nuclear costing is not enough: its umpteen boondoggles must be resolved and market efficiency restored if there is to be an Indian nuclear renaissance.

This post first appeared on Swarajya on December 03, 2014.

Will China Export The Next Chernobyl?

22 Mon Sep 2014

Posted by in India, Nuclear, South Asia

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During his recently concluded visit to India, Xi Jinping expressed China’s interest in participating in India’s nuclear energy market. The sector is expected to be worth at least $150 billion and India’s small domestic nuclear energy capacity cannot handle the rapid ramp up the country’s energy crisis demands. Foreign vendors have been in discussions with Delhi since the India-US nuclear agreement but have so far been vexed by India’s unconventional nuclear liability law. Presently, India is looking to source 40 light water reactors from Rosatom, Westinghouse, General Electric, and Areva; Beijing hopes that its three nuclear developers – China General Nuclear Corporation, China National Nuclear Corporation, and China Power Investment Corporation will receive a piece of India’s nuclear pie in the next round.

While China’s nuclear dream is very impressive and tempting, there are several considerations India must keep in mind. The foremost among these is the vendor’s nuclear safety and regulatory history. At a quick glance, China’s nuclear industry appears just as competent and competitive as any other in the world. China has not had a single nuclear accident scored above 2 on the International Nuclear Events Scale and the country has been constantly improving its standards since its first civilian nuclear reactor went online. After the earthquake-tsunami at Fukushima, the Beijing ordered a full review of its safety precautions to ensure – and reassure – that its reactors were not similarly vulnerable.

However, China’s nuclear establishment is not known for its transparency and concerns have been voiced at regular intervals. Presently, China has 20 nuclear power plants operating and another 28 are being constructed. Of these, most will have the CPR-1000 reactor, the Chinese version of the French 900 MW M310 unit. These reactors have had some problems which the Chinese have been reticent to admit: in 1998, for example, one of the reactors at Qinshan suffered a critical failure and had to be rebuilt because of defects in the welding of the steel vessel that contained the reactor. Worse, these reactors will be operating on technology a century old by the time they are decommissioned.

There is great concern over the process by which China buys or builds its reactors. As one US embassy cable complained, “all reactor purchases to date have been largely the result of internal high level political decisions absent any open process.” To be fair, the United States might be exaggerating the seriousness of the matter to promote its own reactors instead but such concern has also been voiced within China. He Zuoxiu, a Chinese scientist involved in developing the country’s first nuclear device, has warned against the rapid expansion of nuclear facilities without the congruent expansion of intellectual infrastructure to license, construct, and operate the additional reactors. Fan Bi, a senior official at China’s State Council Research Office, agrees. In an article that appeared only a few months before the Fukushima accident, Fan wrote, “If the current momentum of development continues, if too many nuclear power projects are started too quickly, it could jeopardize the healthy, long-term development of nuclear power… Safety is the lifeline of the nuclear power industry.” Others would add transparency of safety and regulatory mechanisms to that list.

Areva, who is involved in constructing two of its latest 1,650 MW EPRs at Taishan, has expressed its concerns over the project. “It’s not always easy to know what is happening at the Taishan site,” said one official. The collaboration was not at a level that the French firm desired, admitted another official, explaining, “One of the explanations for the difficulties in our relations is that the Chinese safety authorities lack means. They are overwhelmed.” Autorite de Surete Nucleaire, the French nuclear regulatory authority, has given few details about its worries in China. However, the body has published hundreds of documents and closely monitored the work at Olkiluoto, Finland, with whom they have better relations.

Yet another concern is the quality of indigenously manufactured reactor components. One former vice president of CNNC confessed that though Beijing puts great emphasis on nuclear safety, “companies executing projects do not seem to have the same level of understanding.” This is encouraged by the cosy relationship between China’s state-owned nuclear regulators and state-owned operators, as well as by a revolving door that allows employees to move easily between government and industry. The formulation of cogent policy is even more challenging due to divided responsibility for the country’s nuclear governance between multiple government departments and bureaucracies. China’s quest for rapid growth only exacerbates these problems of weak regulation, poor implementation, and faulty manufacturing. Given India’s own questionable policies on nuclear transparency and accountability, it would be natural for Chinese firms to replicate their behaviour at home in India as well.

To be fair to China’s nuclear industry, it has also shown remarkable eagerness to achieve the world’s highest standards in safety. It has voluntarily been through a dozen of the IAEA’s OSART (Operational Safety Review Team) missions and subjects all its civilian nuclear facilities to annual inspections by the World Association of Nuclear Operators. Though the details of the reports are private, they confirm that the reactors are operated in conformance with international protocols and standards.

Nonetheless, these accolades are for reactor operation, not construction. China’s suitability as a nuclear partner is in doubt when its export potential is stretched to the limit by its domestic expansion plans – China hopes to add 250 GW of nuclear power between now and 2040, bringing ten reactors online every year. China’s three nuclear enterprises will be hard-pressed to construct and provide post-completion support to their international clients.

For domestic nuclear enthusiasts, one hope is that between international inspections, peer reviews, and collaboration with international entities with a good safety culture, India’s nuclear enclave will also develop greater transparency and accountability. India has never had a nuclear accident rated above 3 on the INES and though an IAEA inspection gave Rajasthan’s nuclear power units a good evaluation, fears abound due to ignorance of the general populace and poor communication by the authorities. The lack of independence of India’s nuclear regulatory authority is also of some concern. Given China’s record on transparency, these values will hardly be inculcated in the Indian establishment via a nuclear partnership with Beijing.

China is a below-par partner on another level too: technology transfer. India has always made the transfer of technology a key component of its high-tech purchases, hoping these would compensate for its own inadequacies in research & development. However, Beijing has little new technology to offer; nuclear energy took off in China only in the late 1980s and Beijing also bases its nuclear decisions on the degree of technology transfers vendors are willing to provide. Like India, China also intends to leapfrog stages of nuclear development via reverse engineering and emerge, initially under license, as a major exporter of nuclear products and services. India would be better served by dealing directly with more mature vendors in France, Canada, Russia, and the United States.

Unlike other sectors, nuclear partnerships are long-term relationships. The life of an average reactor nowadays is 40-60 years and during that time, the vendor is always in the picture. Many reactor contracts nowadays come with a lifetime guarantee of nuclear fuel and support as well and it is not easy to change suppliers as Ukraine recently discovered. Is India willing to enter into a 60-year marriage with a country that denies Indian firms fair market access, props up a neighbouring state with nuclear weapons and missiles against India, has claims on Indian territory, and with whom regular skirmishes along the border are not unusual?

China’s interest in India’s nuclear programme is, to put it politely, curious. Beijing has consistently vetoed Delhi’s application to join the Nuclear Suppliers Group and yet it wishes to enter India’s nuclear market. China may have calculated its policy based on India’s nuclear liability law – as it exists, the law inhibits private foreign vendors such as Westinghouse or GE from competing in the Indian market by imposing new and large insurance premia. The state-owned enterprises of Russia and China, however, will find it easier to provide for the necessary guarantees. If India sticks to its present nuclear liability law, the smaller number of vendors in India’s nuclear bazaar is to China’s advantage. A normative nuclear liability law, however, negates that advantage and leaves China with little to offer.

India must insist on any nuclear cooperation with China to be contingent upon Beijing’s unconditional support to India’s membership to the NSG; China is presently trying to finagle a place for its ally Pakistan along with India in the body and such hyphenation runs contrary to Delhi’s long-stated position. An uncompromising attitude on the NSG costs India little for China has no nuclear unique selling point. The policy of barring India’s entry into the NSG while hoping to enter its nuclear market run contrary to each other.

India’s nuclear establishment has borne the price of four decades in the non-proliferation wilderness. Consequently, it remains in a diminished capacity and sorely needs an infusion of capital and talent. However, China is an unsuitable partner for India in a venture as complex and as strategic as nuclear energy for technical as well as geopolitical reasons. As with telecommunications, it would not be judicious for India to allow China into its nuclear energy market.

This post appeared on Daily News & Analysis on September 23, 2014.