As nuclear energy emerges as significant in India's energy transition, the private sector's involvement is an opportunity that calls for careful navigation of legal and regulatory frameworks
As of December 2024, data by the Ministry of Power, nuclear occupies 1.8 percent, or 8,180 MW, of the total non-fossil fuel capacity of 2,17,625 MW (217.62 GW). Image: Shutterstock
Enabling private sector involvement in nuclear energy has been in the works for some time now. The pathway was further formalised with Finance Minister Nirmala Sitharaman announcing in the Union Budget speech on February 1 that the government will take up amendments to the Atomic Energy Act, 1962, and the Civil Liability for Nuclear Damage (CLND) Act, 2010. “Development of at least 100 GW of nuclear energy by 2047 is essential for our energy transition efforts,” she said. Further, she announced a Nuclear Energy Mission for research and development of small, modular reactors (SMRs), with an outlay of Rs 20,000 crore, and said that at least five indigenously developed SMRs will be operationalised by 2033.
This builds on the announcement she made in her July 2024 Budget speech, where she had stressed on the emergence of nuclear power as a significant part of India’s energy mix, and proposed partnerships with the private sector towards research and development of newer technologies for nuclear energy, and setting up of small reactors. As of December 2024, data by the Ministry of Power, nuclear occupies 1.8 percent, or 8,180 MW, of the total non-fossil fuel capacity of 2,17,625 MW (217.62 GW). The government wants to increase India’s non-fossil fuel capacity to 500 GW by 2030 as part of its energy transition targets. Coal-led fossil fuels still occupy 53 percent of India’s energy mix. The Economic Survey released on January 2025 also cautioned against shutting down thermal energy without adequate alternatives for stable energy supply.
Nuclear power could hold the key to India’s energy independence amid global volatility due to factors like the Russia-Ukraine war and fluctuating oil prices. It could also contribute towards mitigating carbon dioxide emissions, which is critical given that India is the third-largest emitter of carbon dioxide in the world after the US and China, and has pledged to reduce its carbon intensity by 45 percent from 2005 levels by 2030. “Nuclear power, which is clean and essential for base load, is key to India’s energy transition from fossil fuel. Very crucial reforms to immediately focus on SMRs and amend laws to expand investments from the private sector and the liability cap will go a long way to achieve the target of 100 GW by 2047,” says Debasish Mishra, partner and chief growth officer, Deloitte South Asia.
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In February 2024, Reuters had reported that the government is targeting approximately $26 billion in private nuclear power investments, and is in talks with leading power companies. Historically, the nuclear power sector has been dominated by state-owned entities, primarily the Nuclear Power Corporation. In January this year, the government, for the first time, formally invited private investments.