EDF signs preliminary agreement with India for six reactors

27 January 2016

Electricite de France (EDF) on 26 January said it had signed a preliminary agreement with Nuclear Power Corp of India Ltd (NPCIL) to build six European Pressurised Reactors (EPR) at Jaitapur, in Maharashtra state.

The six proposed reactors would add 9600MWe to India's installed nuclear capacity, making Jaitapur one of the biggest nuclear sites in the world. Government-owned NPCIL, the sole company that builds and operates commercial nuclear reactors in India, has set a "target" of expanding the installed nuclear power capacity from the current 5.7GWe to about 14GWe by 2024.

The Jaitapur project is at the preliminary technical studies stage after receiving initial environmental approval in 2010, EDF said in a statement. A contract for pre-engineering studies was signed by Areva and NPCIL last April but EDF is taking over the project from the financially compromised Areva, which will sell its reactor arm to EDF later this year.

Areva last year announced huge losses amounting to €4.8bn and in June the French government announced that Areva would be broken up, with its nuclear power arm, Areva NP, (including engineering, construction and design) being sold to EDF. The French state has an 84.5% stake in EDF. Areva and NPCIL had been negotiating unit price of power generated from the proposed Maharashtra power plant for several years and it is not known what arrangement has now been reached on this.

EDF said that in the next few months it would continue work started by Areva and NPCIL to secure certification for the EPR in India and to finalise the economic and financial conditions. The deal was reached during a state visit to India by French President Francois Hollande during 16 co-operations agreements were signed in various fields.

Hollande and Prime Minister Narendra Modi said in a joint statement they had agreed to hasten the nuclear talks hoping to begin construction in early 2017. Reports in India said NPCIL has already acquired land at the Jaitapur site and has built basic infrastructure.

India's liability legislation has been a major obstacle to planned nuclear deals with France and the USA. Following the 1984 Bhopal gas tragedy which killed at least 4000 and left another 4000 severely disabled and for which no adequate compensation has ever been paid by the US companies involved, India's parliament passed a law six years ago making equipment suppliers responsible for any accident.

A compromise on liability was reached with Russia, which is proceeding with construction at the Kudankulam nuclear plant in Tamil Nadu, and which has agreed to build up to 12 nuclear units in India, with a second site now under discussion. An insurance scheme has since been put in place which offers suppliers some protection. This was enough to reassure France, but the USA is still hesitant.

General Electric Chairman Jeff Immelt said in September that GE would not invest in nuclear power in India until the liability laws are brought in line with global practice.

Photo: Impression of Jaitapur project (Copyright AREVA, Image and process)

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