Archive for January, 2009

US nuke team pushes for firm commitment on project sites

January 13, 2009 Leave a comment

From The Hindu Businessline

January 13, 2009

In the scramble to grab a piece of the estimated $150 billion worth of equipment orders on offer in India’s newly-opened nuclear market, US players are trying hard to make up for lost ground.

With the Russians and the French getting a head start in securing new business opportunities in the Indian nuclear market, a visiting US-India Business Council (USIBC) nuclear delegation, led by GE-Hitachi Nuclear and Westinghouse Electric and with certification from the US Department of Commerce, plans to extract a firm commitment from India on specific sites to be earmarked for atomic power stations to be built by US firms.

“We are certainly expecting some clarity on the sites that are to be earmarked for US participation. As matters stand now, we are currently only a distant third to the Russians and the French… and we are concerned about new sites getting cherry picked…,” the USIBC’s Director, Mr Ted Jones, told Business Line.

The Indian government had earlier provided the US with a Letter of Intent stating its intention to purchase reactors with at least 10,000 MWe worth of new power generation capacity from US firms and had tentatively committed to earmark at least two sites for American participation. The visiting US nuclear delegation, which is being touted as its largest ever trade mission to Delhi and Mumbai, includes over 50 executives representing around 34 US commercial nuclear firms, including GE-Hitachi, Westinghouse, Bechtel Nuclear, The Shaw Group, CH2M Hill, Babcock & Wilcox, Uranium One, Thorium Power and USEC. The delegation is set to meet with the top brass of State-owned Nuclear Power Corporation of India Ltd (NPCIL) on January 15.

France’s Areva SA and Russia’s Rosatom Corporation have got a head start on Indian orders after the 45-nation Nuclear Suppliers Group lifted the ban on September 6 last year. While the Russians, who are currently in advanced stages of setting up two 1000 MWe nuclear units at Koodankulam site in Tamil Nadu, are on course to set up another four units at the same location, the French have inked a fuel pact with India and are likely to be offered the Jaitapur site in Maharashtra for Areva’s EPR Pressurised Water Reactors.

India hopes to place orders for nuclear equipment worth an estimated $14 billion by the end of 2009 in the first set of tenders for new Light Water Reactors (LWRs) on the anvil. As a step in this direction, NPCIL had short-listed GE and Toshiba Corporation’s Westinghouse Electric Company, along with Areva and Rosatom, for these orders. Earlier, the Department of Atomic Energy had tentatively identified five coastal sites where imported LWR clusters could come up.

“In recent decades, US reactor companies and civil nuclear engineering companies have remained at the forefront of innovation and engineering worldwide. US industry, including many of the commercial nuclear suppliers on this Mission, provided massive political support for the US-India civilian nuclear initiative,” Mr Jones said.

One of the reasons for the US players delaying their entry into the Indian nuclear market is they have been holding out for India to draft and ratify a domestic law consistent with the International Atomic Energy Agency’s (IAEA) Convention on Supplementary Compensation for Nuclear Damage, in order to limit liabilities for the reactor vendors in case of an accident or mishap.

The convention, among its provisions, places the onus of compensation in case of nuclear damage on the ‘Installation State’ (where the nuclear facilities are located), in this case India. The US nuclear industry, which comprises entirely private firms, has been insisting that they need the liabilities framework as an enabling provision before they enter the Indian market unlike the Russian and French players, which are mostly State-owned firms with sovereign guarantee.