India unlikely to follow new Japan N-power pricing model

In what could influence how governments calculate the cost of producing nuclear power, Japan has begun adding societal factors, such as the price of dealing with nuclear accidents, sharply inflating the bill.

Experts say India is unlikely to follow Japan’s model, but it could give ammunition to detractors of nuclear-generated power in the country.

A government body in Japan has said in a recent reportthat the cost of producing nuclear power in that country is now about 50% more than in 2004.

The added cost has resulted from including “the price of dealing with nuclear accidents and policy costs related to the government’s budget”, it said.

While there was no official comment from India’s nuclear establishment, a senior official, who didn’t want to be identified, said the country was unlikely to adopt the method—of incorporating the risk of nuclear plants into power generation costs.

The Japanese government agency that oversees energy and environment policy has estimated the per-unit cost of nuclear power at 8.9 yen (nearly Rs6)—significantly higher than the 5.9 yen estimate for 2004.

Factoring in the possibility of a core meltdown—because of the March accident at the Fukushima Daiichi nuclear power station after a tsunami struck—societal costs were included for the first time.

The cost of producing nuclear power in India varies from as much as 90 paise a unit from the country’s oldest plants at Tarapur, Maharashtra, to Rs3.02 a unit, according to Nuclear Power Corp. of India Ltd, which operates 18 such plants.

Thermal power, the most ubiquitous source of electricity in India, costs between Rs2 and Rs4 a unit.

Detractors of nuclear power have maintained that the enormous cost of setting up a nuclear plant and concerns over radiation dwarf its low running cost and minimal emissions.

Additional factors such as the one used by the Japanese government could bring the per-unit cost closer to the cost involved in generating solar and wind power, and could open another line of attack for campaigns that demand a halt to nuclear plant expansion in India, according to analysts.

“We cannot follow Japan’s yardstick. Different accidents have varying levels of risk and our disaster management laws already make a provision for the funds required towards mitigating damage,” said an official at Nuclear Power Corp. “That can’t be rationally factored in in advance.”

Through the past year, India has seen roiling controversy over forthcoming nuclear power projects at Jaitapur in Maharashtra and Koodankulam in Tamil Nadu significantly influenced by the disaster at Fukushima Daiichi.

Japan saw a series of nuclear reactors destruct and release copious—but harmless—radiation in the aftermath of the tsunami.

“As the Japan report shows, nuclear energy there is still cheaper than wind or geothermal,” said Sandeep Tripathi, a nuclear policy analyst, “But this could certainly lead to fresh questions of whether societal costs ought to be included in nuclear power costing.”

India produces about 4.7 billion watts of nuclear electricity and has announced plans for facilities for 14 billion watts in its forthcoming 12th Five-Year Plan (2012-17).