The Hindu Business Line : US nuclear players press India for liability framework

New Delhi, Oct. 19 The US private sector firms, which do not have their national government guarantee for accident claims, are lobbying hard with the Indian Government to lay down a policy framework on the issue of nuclear liability - or the cost of damages to be borne in case of an accident involving US-supplied nuclear power plants.

State-owned French and Russian nuclear companies, which have sovereign backing, are more or less immune to any such liability.

“American business delegations to India have been saying that unless protected under liability laws, they would find it impossible to sell reactors in India, a stance that is actively supported by the US Government,” an official said.

“Liability limitations remain very important for companies operating in this area.

“We and other companies have communicated this to the US and Indian Governments and are confident that India recognises the need to address this issue,” the GE Energy CEO, Mr Kishore Jayaraman, told Business Line.

Compensation convention

GE and other private sector US firms have been seeking India’s ratification of a new global compensation convention that is in the works and the simultaneous adoption of domestic legislation on the issue.

Indian private sector firms eyeing the nuclear space have also petitioned the Government for clarity on the liability issue.

Currently, the Union Government bears this liability for Nuclear Power Corporation of India Ltd, a State-owned firm and the only player permitted to operate nuclear power stations in the country.

It would have to enact a fresh ‘Nuclear Liability’ law that would clearly spell out the compensation amount and the guarantor in case of a mishap when the private sector is allowed entry into the nuclear space.

‘Fuel cycle’ link

The nuclear liability issue is also linked to concerns over the kind of ‘fuel cycle’ policy that India would adopt if the private sector is allowed entry into the nuclear generation space.

According to the World Nuclear Association, countries around the world broadly follow two kinds of fuel cycle policies — ‘open’ or ‘closed’.

The US, Canada, Spain and a few other countries follow an open fuel cycle policy where private sector or public sector entities use the fuel for power generation once and then send it to Government-designated repositories for storage and subsequent reprocessing at a later stage.

Private companies in these open cycle countries are, thereby, allowed only front-end activities and power generation. The question of any liability arising from spent fuel polluting the environment besides claims arising from accidents involving reprocessing-related activities thus does not arise for companies subjected to an ‘open’ fuel cycle policy. They are not allowed back-end fuel reprocessing activities.

Reuse facility

The UK, Japan, France, Russia and a few other countries, including India, follow a closed fuel cycle policy, where spent fuel is reprocessed by the power generating agencies (mostly State-owned) themselves for reuse again as fuel for generation.

Companies in these closed-cycle countries are, thereby, allowed both front-end and back-end activities while liability issues are addressed largely by the Government.

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