IEEE Spectrum July, 2007 - 25

The DAE also maintains that nuclear power is much cheaper
than other sources of energy, but the agency's budgets paint
a different picture. When the DAE has compared the costs of
generating electricity from nuclear reactors with those from coalfired plants, India's staple source of electricity, it has assumed
that the coal plants are located far from the source of their coal.
Obviously, that assumption inflates coal transportation costs
and biases the comparison in favor of nuclear power.
In the early years, the DAE claimed that nuclear power
was cheaper than thermal plants that were located more than
600 kilometers away from the coal mines. By the 1980s the distance had crept up to 800 km. A 1999 study increased the distance
to 1200 km. In fact, though, one-third of India's coal plants are
located right next to a mine pithead, and another quarter or more
are within 500 km of one.
Even the 1200-km claim does not hold up to scrutiny. Two
researchers from the International Energy Initiative and I compared the cost of producing electricity at India's most recently
commissioned nuclear reactor, a 220-megawatt heavy-water

1987 India's
nuclear-generated
electricity capacity
is 950 MW.

1975 The Nuclear
Suppliers Group, an international organization that
aims to reduce nuclear
weapons proliferation,
forms in response to
India's nuclear tests.

1975

2000 President Bill
Clinton visits India, the
first U.S. president to
do so in 22 years.
2000 India's nucleargenerated electricity
capacity is 2.7 GW.

1980

1985

18 May 1974 India
explodes its first
nuclear device at
Pokhran and claims
the explosion was for
peaceful purposes.

from lEft: PuNJAb Photo/AfP/gEtty ImAgES;
NuclEAr PowEr corP. of INdIA; t.c. mAlhotrA/gEtty ImAgES

reactor at the Kaiga atomic power station in the southern state
of Karnataka, with electricity from a nearby coal plant that is
1400 km away from a mine. We found that the nuclear plant was
about 8 percent more expensive at the government-determined
rate of return on investment, which reflects the present value
of future benefits and costs. At market rates of ROI, however, it
could be 50 percent more expensive.
A 2003 study by researchers at MIT reached similar conclusions for the United States; it found that the cost of U.S.
nuclear-generated electricity is about 60 percent higher than
electricity generated from coal. Of course, it's difficult to make
a direct comparison between India and Western nations because
of differences in labor costs, as well as India's more lax licensing guidelines, which make all power plants generally cheaper
to build and operate. Still, the trend is clear: both in India and
elsewhere, the capital costs of reactors make nuclear power significantly more expensive than electricity from coal.
We deliberately made a number of assumptions in our economic comparison that favor nuclear power. For instance, the
DAE does not factor in the costs of dealing with radioactive
wastes from nuclear power, and so neither did we. The depart-

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ment's rationale for that exclusion is it reprocesses all spent fuel,
segregating the waste according to its radioactivity. A colleague
and I calculated that reprocessing would cost about US $600 per
kilogram of spent fuel. Including even half of that amount would
make nuclear power's additional expense over coal jump from
8 percent to 27 percent.
Another factor artificially driving down the cost of nuclear
power is that, unlike many other countries, India has no provision for insurance liability against nuclear accidents. In
the United States, for instance, the Price-Anderson Nuclear
Industries Indemnity Act, passed in 1957, requires that nuclear
utilities cover each reactor they operate with the maximum
available amount of insurance, which in 2005 was $300 million
per plant. Every company licensed to operate a reactor in the
United States must also contribute to a fund to pay for cleanup
and damages, should an accident occur. In India, the assumption
seems to be that the government will deal with the consequences
of an accident; in effect, this amounts to a subsidy to the nuclear
sector and obscures nuclear power's true cost.

1990

1995

2000

11-13 May 1998 India
conducts a second set
of test explosions.
28-30 May 1998
Pakistan responds
by exploding its own
nuclear devices

That is not to downplay the enormous environmental havoc
wreaked by coal-fired power plants, which generate more than
two-thirds of India's total electricity, according to India's
Ministry of Power. The plants emit not only carbon dioxide but
also large quantities of noxious gases and harmful particulates.
Those pollutants urgently need to be reduced, but increased reliance on nuclear power is not a cost-effective way of doing so.

alThough IndIa's nuclear energy program today is
mired in problems, its beginnings were filled with hope.
Many of the fundamental ideas about the role of nuclear
energy in India can be traced back to Homi Bhabha, the architect of India's nuclear establishment, and Jawaharlal Nehru,
the country's first prime minister. Bhabha and Nehru viewed
nuclear technology as a way to jump-start the new nation's
social and economic development. In Nehru's eyes, India's earlier failure to develop steam power had caused it to miss the
Industrial Revolution, and nuclear power, he reasoned, was
the modern equivalent of steam. In 1948, while in the midst of
setting up India's Atomic Energy Commission, Nehru argued
that, "if we are to remain abreast in the world as a nation which

July 2007 | IEEE Spectrum | NA 37

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