Nuclear industry: three cheers (not) for Jaitapur, a perspective

During French President Hollande’s ongoing visit to India, India and France are expected to announce that they are going to enter into an agreement to import six nuclear reactors marketed by the French company Areva, which are to be constructed in Jaitapur in Maharashtra. In this article, M.V. Ramana, physicist and lecturer at Princeton University´s Program on Science and Global Security and the Nuclear Futures Laboratory, discusses three reasons for the Indian government to not enter into the agreement.

M.V. Ramana *

When French President Francois Hollande visits Delhi to attend this year’s Republic Day parade, India and France are expected to announce that they are going to enter into an agreement to import six nuclear reactors marketed by the French company Areva. These European Pressurized Reactors (EPR) are to be constructed in Jaitapur, Maharashtra on the Arabian sea. The idea of importing EPRs from France for Jaitapur was initiated during the Manmohan Singh government and has been pursued by the Narendra Modi government as well. There are at least three notable things about this project that make it dubious and not worth pursuing.

Troubled history
First, the EPR has a troubled history. No reactor of this kind is operational anywhere in the world. There are four under construction — in Finland, France, and two in China — and all of them are delayed, including the ones being built in Taishan in China. The first of these was the project at Olkiluoto, Finland, which was supposed to come online in 2009, but has been delayed because of innumerable problems. It is now projected to start operating in 2018 — if all goes well.

The case of the EPR in Flamanville, France is similar, but with a twist: last year, the French nuclear regulator, the Autorité de Sûreté Nucléaire (ASN), announced that it had been informed by Areva of an anomaly in the composition of the steel in certain zones of the reactor vessel of the Flamanville EPR. The reactor vessel holds the hot and radioactive fuel during operations and has to withstand high temperature and pressures. Understandably problem with this reactor component is, as the president of ASN put it, “serious — even very serious”. The detection of the problem at this late stage, in the words of French energy analyst Yves Marignac, “means that either Électricité de France (EDF) or Areva overlooked the risk of this kind of problem, which would reflect badly on their competence, or they were trying to create a fait accompli before it was detected”. In any case, this discovery has led to widespread concern about the French nuclear supply system — except, evidently, within the decision-making circles in the Indian government.

Related to these lengthy delays, there has been a corresponding escalation in costs, with both Flamanville and Olkiluoto’s current estimates exceeding initial projection by a factor of three or more, from €3.2 billion to €10.5 billion in the case of Flamanville. That translates to roughly €6,500 (or US$7,000) per kilowatt (kW) of capacity. These cost and time overruns of the EPR have been attributed, at least in part, to the complexity of the design according to an official report authored by Francois Roussely, European vice-president of Credit Suisse and honorary president of EDF; this complexity, “without doubt hinders its construction and consequently impacts on its cost” according to the Roussely report. Since it is essentially the same design that will be exported to India, there will doubtlessly be problems with construction in Jaitapur as well.

Expensive electricity
The second problem with the proped project is that, if it is constructed, electricity from the reactor would be very expensive. In a paper published in the Economic and Political Weekly in 2013, physicist Suvrat Raju and I showed that if the unit cost of capacity for the Jaitapur project was assumed to be US$4,000/kW, then the initial year’s tariff for electricity from these reactors, without including transmission and distribution costs, is likely to be around Rs. 15 per unit (kilowatt hour (kWh)) of power. The methodology we adopted was exactly the same as had been used by India’s Nuclear Power Corporation to justify importing nuclear reactors from the United States although we used cost estimates derived from actual construction rather than theoretical projections. The key variable is the cost per unit capacity and our assumption of US$4,000/kW was a very charitable estimate that allowed for substantial decreases in the capital expenditures as a result of many components being manufactured within India and paying labourers and engineers much less than if the reactor had been constructed in Europe. In fact, it was as optimistic a cost decrease as the Nuclear Power Corporation of India has projected as achievable through local construction: its head has been cited as saying that one could save 25-30%, which he described as a “huge” advantage.

Since then, however, cost estimates for EPRs have increased further. Apart from the cost increases for the reactors in France and Finland, a good data point is the case of the two EPRs proposed for construction at Hinkley Point in the United Kingdom. The plant is estimated to cost up to £18 billion, of which £6 billion are to come from China General Nuclear Power Corporation and £2 billion pounds as subsidies from British tax-payers. In addition, the UK government has promised a guaranteed price of £92 per megawatt-hour that would increase with inflation and is more than twice the average current wholesale cost of electricity in the country.

The per unit cost for Hinkley Point is in excess of US$8,000/kW. But even if one uses the estimate of roughly US$7,000/kW, as is the case for Flamanville-3, and modify that by a factor of 25-30% to account for reduction in costs due to manufacture in India, the resulting cost per unit capacity will come to around US$4,900 to US$5,250/kW. At US$5,100/kW, the first year tariff for electricity from Jaitapur would be nearly Rs. 19 per kWh.

To put this in perspective, a recent reverse bidding process for solar power projects in Rajasthan had a winning bid of Rs. 4.34 per kWh. In the state of Maharashtra, a solar developer has put in a bid of Rs. 4.41 per kWh. For coal-based power, recent bids have been around Rs. 4.50 per kWh.

In other words, Jaitapur will result in very expensive electricity in comparison to alternative sources. It is reminiscent of the very expensive and controversial Naptha-based project that was constructed by Enron Corporation in Dabhol in Maharashtra in the 1990s.

Seismic risk
Third, the proposed reactor site is in a zone with a relatively high degree of seismic risk. In November 2011, two renowned seismologists published a paper in the Indian Science Journal Current Science which examined the historical record and concluded that a severe earthquake, such as the ones that struck nearby Latur (100 km from Jaitapur) and Koyna (400 km) in 1993 and 1967 respectively, “although unlikely . . . could occur within the lifetime of the nuclear power plant” in the close vicinity of Jaitapur. In a subsequent paper in the same journal, these scientists were even more explicit: “Jaitapur lies in a region where plate tectonic stresses are locally close to critical failure, and where minor perturbations in stress can trigger earthquakes. Geologically, the Jaitapur region meets many of the criteria known to be conducive to intra-plate seismicity. Tectonically, the Jaitapur region is precisely in the same state of seismic quiescence and historical ignorance as the regions of Latur or Koyna were, prior to the damaging earthquakes for which they are now famous”.

Why are earthquakes a special concern? As evidenced by accidents such as the ones at Three Mile Island (1979) and Chernobyl (1986), nuclear power plants can undergo severe accidents even when there are no earthquakes. This potential for severe accidents is amplified during earthquakes because they simultaneously affect many different components of nuclear power plants. Simultaneous failures in different components could lead to what are called common-cause accidents, and these are very difficult to model in standard risk assessments. In part, this is because of the many uncertainties involved in a nuclear reactor’s behaviour during earthquakes. The combination of a nuclear reactor design that has never been operated before and a site that could experience earthquakes is a prescription for heightened risk.

In part as a result of these risks, there is significant local opposition to the project, which has in turn induced the Shiv Sena party, a key alliance partner of the Bharatiya Janata Party (BJP), to ask the central government to scrap the project.

One of the lessons from the nuclear reactor accidents at Fukushima and Chernobyl is that although radioactive fallout from these accidents spread far and wide, the bulk of the health and environmental consequences were borne by inhabitants of the areas near these facilities. Thus, the concerns of inhabitants of the villages near Jaitapur do deserve special attention.
There are, thus, ample reasons for the Indian government to not enter into an agreement to purchase EPRs for Jaitapur. It should still be possible to walk away from the project. Will the government do that or succumb to geostrategic or ideological interests?

* M.V. Ramana – Princeton University
ramana@princeton.edu
Further Reading
•Autorité de sûreté nucléaire (2015), ‘Flamanville EPR reactor vessel manufacturing anomalies’, 7 April 2014.
•Bilham, R and VK Gaur (2011), “Historical and future seismicity near Jaitapur, India”, Current Science, 101(100):1275-1281. Available at: http://www.greenpeace.org/india/Global/india/Historical%20and%20future%20seismicity%20near%20Jaitapur,%20India.pdf
•Kumar, A and MV Ramana (2007), ‘Nuclear safety lessons from Japan’s summer earthquake’, Bulletin of the Atomic Scientists, 4 December 2007.
•Ramana, MV (2011), ‘Beyond our imagination: Fukushima and the problem of assessing risk’, Bulletin of the Atomic Scientists, 20 April 2011.
•Ramana, MV and Suvrat Raju (2013), “Cost of electricity from the Jitapur Nuclear Power Plant”, Economic and Political Weekly, Vol. 98(26-27), 51-60. Available at: http://www.princeton.edu/~ramana/SA_XLVIII_26-27_290613_Suvrat%20Raju_M%20V%20Ramana.pdf
•Roussely, F (2010), ‘The Roussely Report: saving the French nuclear industry with outrageous measures’, Sortir du nucléaire, 27 July 2010.
•Sant, G, S Dixit and S Wagle (1995), ‘The Enron Controversy: Techno-Economic Analysis and Policy Implications’, Prayas.
•Scientific Correspondence (2012), “Discussion of seismicity near Jatiapur”, Current Science, 103(11): 1273-1278.
•Thakur, Sudhinder (2008), “Economics of nuclear power in the Indian context”, Atoms for Peace: An International Journal, 2(1). Available at: http://www.inderscienceonline.com/doi/abs/10.1504/AFP.2008.019891
•Yeo, S (2015), ‘New Nuclear: Finland’s cautionary tale for the UK’, CarbonBrief, 20 October 2015.

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“Reprinted with permission from Ideas for India (www.ideasforindia.in)”