USA- India nuclear sales quietly fading, as nuclear financially unviable

the focus should now be on mainstreaming solar power, and, as assessed by Gateway House last week [12], its associated technological benefits such as electric vehicles, which can help bring down carbon dioxide emissions and help Prime Minister Modi meet his Oct 2 climate change commitments sooner rather than later.

Quiet burial for the nuclear deal? 5 NOVEMBER 2015, Gateway House BY Amit Bhandari

Solar power developers have offered to sell electricity in India at less than Rs 5/unit. This makes solar competitive with traditional forms of energy, and makes new nuclear power plants financially unviable. India must register the changed reality, and discard the idea of expensive Western reactors. Time to scrap the India-U.S. nuclear deal?

Hard on the heels of falling oil prices and affordable shale, comes another dramatic energy changes for the energy industry: The falling cost of solar energy. This has many implications, but the most immediate impact the nuclear power industry, large parts of which may have just become obsolete. This means that the new nuclear power plants being planned by India, especially those with foreign collaboration, must be reconsidered and scrapped if they are financially unviable.

Most significant is the impact on the India-U.S. nuclear deal, held up by the liability clause to enable these reactors, and a sticking point in the bilateral for several years: technological advances have addressed an issue that negotiators couldn’t resolve.

This transformation environment is the result of U.S.-based renewable energy major SunEdison winning, on 4 November, the bid to supply solar electricity in India at a record low price of Rs 4.63 per kilowatt-hour (kWh)[1]. News reports indicate that as many as nine companies offered to supply solar electricity for less than Rs 5 per kWh[2], indicating this isn’t a one-off bid delinked from market prices……..

The electricity tariff from the under-construction Units 3&4 of the Kudankulam Nuclear Power Project will be Rs 6.3 per kWh[6]. The latter price can increase in case of cost and/or time over-runs, which are common in nuclear power projects globally and in India.

If the price bid by SunEdison and others are correct, then nuclear power based on these designs is already rendered obsolete. The cost of solar power has been consistently falling for the past several years, and should fall even further, increasing the gap………

The one argument in favour of the Western reactors – that they will provide electricity without causing carbon dioxide emissions — is now negated by the vastly cleaner, cheaper alternative, i.e. solar energy.

As seen in the bids from SunEdison and others, solar comes without the attendant risks, insurance costs or public opposition. Solar power is limitless and is available across the Indian subcontinent – unlike nuclear fuel, which needs to be imported and where India is vulnerable to sanctions. Sanctions on fuel and technology have hobbled India’s nuclear program in the past. Solar power can also be decentralized – instead of one big plant at a single location, smaller plants can be set up at multiple locations. This reduces losses in power transmission and also allows electrification of sites which are off the main grid. Reduced loss in transmission can also help tackle another problem India faces – 23% of all electricity is lost to technical factors or to theft[10].

Localised generation, which is possible with solar, can help bring down transmission losses. Adoption of solar power will still be hobbled by the poor financial health of India’s state power utilities, which collectively incurred a loss of Rs 62,154 crore ($9.5 billion) during FY14 and find it difficult to pay for the electricity they purchase[11]. However, solar power will still be a better option than more expensive nuclear power.

Given these changed circumstances, it is time that India and the U.S. wake up to the new reality created by technology, and give a quiet burial to the proposed power reactors. Instead, the focus should now be on mainstreaming solar power, and, as assessed by Gateway House last week [12], its associated technological benefits such as electric vehicles, which can help bring down carbon dioxide emissions and help Prime Minister Modi meet his Oct 2 climate change commitments sooner rather than later. http://www.gatewayhouse.in/quiet-burial-for-the-nuclear-deal/