After being locked out of global nuclear trade for more than three decades, India is looking to lock up some major energy deals. Large global energy companies are lining up in droves to make sure that happens.
India launched its first nuclear test in 1974, but the country refused to sign the global Treaty on the Non-Proliferation of Nuclear Weapons (NPT). As a result, the 45-member Nuclear Suppliers Group (NSG) banned India from global nuclear trade.
That ban was lifted last September when Washington pushed through a “waiver” that freed India from 34 years of sanctions.
Critics of the deal worry that by lifting the trade restrictions on India, the world’s “responsible” nuclear powers are undermining the NPT and could potentially reignite an arms race with India’s rival Pakistan. But the deal’s supporters see the decision as an act of good faith towards India that will enhance global ties and help that nation meet its growing energy demand, perhaps through a more eco-friendly method than burning coal and oil.
As it now stands, about 69% of India’s electricity is generated from coal, according to the World Coal Institute. Demand is projected to soar from 391 Megatonnes (a metric ton, also referred to as “Mt”) in 2002 to 758 Mt in 2030 - a 94% jump.
In fact, only one country is expected to have greater demand for coal during that period - China.
Up to now, one problem has been that India only has 17 nuclear reactors, which produce just 2.5% of the country’s electricity.
“India does not have much of energy option,” V. Raghuraman, an energy advisor to the Confederation of Indian Industry, told the Voice of America. “We are short of hydrocarbons. We are short of coal. We are short of everything. We need an energy mix. We need to make the ground today to prepare for the future.”
India would like to boost its nuclear energy capacity from by 60,000 megawatts (Mw) over the next 15 years, according to Raghuraman. That would more than double the contribution that nuclear power is making to India’s electricity grid. For that to happen, however, India would need to add 40 new nuclear reactors at a cost of roughly $80 billion.
This nuclear “explosion” will generate billions of dollars of new business for the world’s leading energy companies, as India scrambles to secure fuel, acquire equipment, upgrade its technology, and develop and train workers to build, operate and maintain the power plants.
“Today, since there has been a technology denial and fuel denial for the last more than three decades, India has developed an in-house program and there have been some capabilities, but surely these are not world class or also of the capacities which are required for future development,” said Raghuraman. “Which would mean we really need to access technology. We would like to look at accessing technology from all around, because the kind of capacities which we need are phenomenal.”
