Having private participation in India’s nuclear energy

In July 2024, the Indian government announced plans to expand its nuclear energy sector, proposing partnerships with the private sector for the development of Bharat Small Reactors (BSR) and Bharat Small Modular Reactors (BSMR) to meet its COP26 commitment of achieving 500 GW of non-fossil fuel energy by 2030. This renewed focus on nuclear energy comes amidst existing legal frameworks and challenges that govern private sector participation.

Regulatory Framework Challenges

• Atomic Energy Act, 1962 (AEA): The AEA, primarily governing nuclear energy, restricts private sector involvement in nuclear power licensing, granting sole control to the central government. Recent Supreme Court dismissals of petitions challenging these restrictions underscore the challenges of engaging private entities in this sector.
• Civil Liability for Nuclear Damage Act, 2010 (CLNDA): The constitutionality of the CLNDA, which outlines compensation for nuclear incidents, remains in judicial limbo, complicating private investment potential. The act has faced scrutiny for allegedly violating principles of absolute liability and polluter pays, adding uncertainty to the nuclear landscape.
• Need for Legislative Reforms: For private sector engagement, significant reforms in the AEA and CLNDA are essential. A conducive regulatory framework must balance safety concerns with the need for private investment to support the ambitious growth of India's nuclear energy capacity.

Private Sector Participation

• Public-Private Partnerships (PPPs): A viable model could involve PPPs where government bodies like the NPCIL hold a majority stake in nuclear projects. This structure would invite private investment while maintaining governmental accountability and compliance with the AEA.
• Involvement of Private Firms: Historically, private firms have participated mainly in engineering and construction but have been barred from R&D activities due to strict regulations. Allowing private sector participation in R&D is crucial for technological advancement and innovation in nuclear energy.
• Investment Potential: The government aims to attract around USD 26 billion in private investments for nuclear energy. Achieving this goal hinges on creating a robust framework that encourages private participation while ensuring stringent safety measures.

Safety and Accountability Issues

• Historical Context of Nuclear Accidents: Historical nuclear accidents like Chernobyl and Fukushima highlight the inherent risks associated with nuclear technology, emphasizing the need for comprehensive safety regulations. The stringent regulatory oversight is necessary to mitigate public fears regarding nuclear safety.
• Role of the Atomic Energy Regulatory Board (AERB): Concerns persist regarding the independence and authority of the AERB, which oversees radiation protection. Legislative reforms, such as the stalled Nuclear Safety Regulatory Authority Bill, are necessary to enhance regulatory independence and public confidence.
• Public Accountability Measures: A structure where government holds majority stakes in nuclear projects ensures accountability under the Right to Information Act (RTI). This transparency is vital for maintaining public trust in nuclear energy initiatives and their safety protocols.

Practice Question

Q. Critically analyze the implications of the current regulatory framework governing India’s nuclear energy sector for private sector participation, considering recent legislative announcements and judicial challenges. What reforms would you suggest to enhance investment and ensure safety?