'No entry for private sector in nuclear utilities business'

The acrimony over the Indo-US Civilian nuclear deal has been put paid, now that Prime Minister Manmohan Singh is firmly back in the saddle, so can a nuclear sunrise be far away? The time it seems is ripe for global nuclear commerce to begin. In his first ever interview after the nuclear deal was completed, the man who now has to dole out the big ticket $150 billion contracts, Dr S K Jain, chairman and managing director of the Nuclear Power Corporation of India Limited (NPCIL) explains what to expect in the coming months. Jain a mechanical engineer, who has spent four decades with the Indian nuclear industry, spoke to Pallava Bagla, NDTV's Science Editor. 

At NPCIL, is there a lot of excitement thanks to the nuclear deal having being inked and finalized?

I am operating 17 plants, and the young team, incidentally we are having 14,000 strong people, each one is so much excited that so far we have been moving on successfully, but slowly. Now the opportunity has come where we can really, you know, fly at a high speed. So I look for very big and bright prospects for the country and also one day in future, become a very big international player.

What is your expectation? How much can we generate from nuclear in coming years?

Our expectation actually is, that in next 25 years it should be possible for this country to touch around 40,000 MW nuclear power.

There is also plan to go to about 25% of the power by 2050 from nuclear. Is that something which is likely to happen?

It will definitely happen.

So you are looking at some joint ventures?

We are definitely looking at joint venture and incidentally the first of the joint venture which we have signed with NTPC and the concept of the joint venture is, the one question which is being asked to us is whether NPCIL only will be the single player which can meet all the requirement or that we need many players, and to be very frank, the kind of program which we are looking for, there will be a need for many players to come and support.

So will the private sector have a role in this?

As you know, as per the current Atomic Energy Act there is no provision where they can have a majority ownership and a utility company.

So 51% stake will always remain with Nuclear Power Corporation of India Ltd?

As of today. And really speaking even today as NTPC has joined us as a minority partner, even a private player, if they are interested they can join us, and the purpose of this is that to open the sector in step by step and slow fashion through this joint venture route so they can develop the technology, they can learn the technology and maybe a decade from now they can be independent and set up their own plants.

So right now are you anticipating an amendment in the Atomic Energy Act to accommodate the wishes of the industry?

As per the present Government of India policy is concerned, they are for liberalization and the electrical sector actually already is liberalized for generation, transmission and distribution. Some day far in future, there will be a need to amend the Atomic Energy Act.

So the private sector can hope for that amendment some time?

But, today also there is an opportunity for them to join us.

But private sector cannot become nuclear utility owners?

They are designers, vendors and service providers. Coming to the role of the utility providers, today incidentally, except for nuclear, all other sectors have been privatized. And there is a question whether nuclear sector will remain only one player or more than one player. The kind of capacity addition you know, which is considered to be available for the country as per Integrated Energy Policy by 2032, actually from the current 4000MW it has to go to 63,000 MW. So as per my opinion actually you know that definitely there will be need for more than one player.

So you are willing to give space to other players.

Obviously it will eventually take place, but because nuclear technology you know is very specific, generally you know when we try to discuss this issue with all the players, we just to give a feel of what kind of problem it can be, we give an example. If suppose Enron was in private sector and Enron was a nuclear power plant; whether country could have afforded that kind of scenario?

You mean you can't just shut down and run away.

Yes, that's right. There are no exit routes available from the nuclear technology. Means once an entrepreneur enters into nuclear technology, it has to be nursed, and the plant actually has to be taken care of, whether it is producing power or not, whether it is running into loss or not. So this kind of quality culture and safety culture has to set in.

Does the private sector understand this?

Definitely.         

That they will have a tiger by its tail if they own a utility?

I would not put it you know tiger wise, but they understand the specificity of the nuclear technology, first is about the front end and the back end of the fuel cycle you know because it is also linked with the non-proliferation part and the country has to you know, account for this particular thing. At the same time, they are also clear about this particular aspect. Only thing is, step by step if they enter into this program they will develop you know, what we call it as corporate strength, the corporate culture, that kind of awareness, that is of merger and acquisitions and the way it is possible in the other industry. It will be tied up with other commitments. And I don't say it is difficult to get a feel of that particular thing. One day it will happen that some of the private sector step by step they will join hands with us and they can graduate to become an independent player and also play a big role.

One need which the private sector says is that India enact a Liability Act and sign up to the Liability Convention. Is there something move towards that?

Yes. Actually this particular aspect of the liability is very-very crucial and important for any, not only Indian private companies but even a foreign vendor which is willing to supply technology to NPCIL. And on this Liability Convention, I can share with you all the homework which is required for translating into an act, has been completed. And it is a matter of time you know when this particular homework is converted into an act.

So we are willing to join that convention.

Absolutely, yes.

Absolutely not.

Because that is what the Americans companies want?

As I told you that it's across the board. Any private Indian industry or any private foreign vendors, they will like to know their commitments in the event of any of the mishap takes place. So it is connected with the total nuclear power program.

So when can one expect electricity to flow from the imported plants which are coming as part of this inking of the nuclear deal?

Around 6-7 years from now.

You are also short of uranium in India. Are you doing something to enhance our capacity, not just importing fuel, but looking at mines overseas?

When we are talking about enhancing the uranium availability, it is not only through the direct purchases. It is not through yellow cake purchase alone, it is not that only purchasing pellets. We are also doing it step by step direction. One is, today you know if we are going to increase the light water capacity, say 20,000-30,000 MW, we would not like to import readymade fuel. We would like to develop technology and may not be in our country to start with, to having stakes in the uranium enrichment, fuel.

So are you looking at joint ownership of mines?

Very aggressively. Very aggressively you know we are looking at the proposals so that we can have stakes in the uranium assets abroad. And I can share with you that there are very positive indicators on that front and it's a matter of time that NPCIL will own some of the mines as a stakeholder.

And will be first time we'll be stepping out and owning uranium mines outside India?

That's right, that would not only to take care of our own indigenous reactors which will be under Safeguards, but you know that we are very clear that we want to have a kind of mechanism so that lifetime guarantee of our fuel [supply is available] for our reactors for their lifetime of operation. And through that route having stakes in not one mine but multi sources mines and also developing capabilities of fuel fabrication in our country. That's what we want.

And how safe are our plants? Can you keep your hand on your heart and tell people that Indian power, nuclear facilities are safe and people living around them don't need to worry?

I have no hesitation actually in frankly sharing with the public that our nuclear power plants are very safe and the past two ninety years of reactor operations, there was not even a single incident where radioactivity has come out in the public domain. So the reliability and safety, they go together. And they are, I can share with you, they are the safest plant in the world.

(Pallava Bagla is Science Editor for NDTV)