AREVA, the French electricity major, is bullish over India’s massive nuclear capacity addition programme. The company is currently involved in negotiations with state-run Nuclear Power Corporation (NPC) for supply of two reactors (EPRs) of 1,650 Mw each for its Maharashtra project. In an interview with Sanjay Jog, its chief operating officer, Luc Oursel, explains company’s India strategy. Edited excerpts:
How are the negotiations with NPC for supply of two EPRs progressing?
It’s 18 months since both companies signed the initial memorandum of understanding (MoU) an agreement and we’re involved in comprehensive and positive talks. Undoubtedly, NPC is a knowlegeable nuclear operator and they show great interest in EPR’s state-of-the-art technology. AREVA will be involved in the supply of EPRs, initially two and subsequently four more, for the proposed Jaitapur project, with total generation capacity of 10,000 Mw. We are keen on a global package approach, including long-term enriched uranium supply, fuel design and manufacturing in India, and also services to support NPC's plant operation and maintenance.
When can we expect both companies to sign the initial agreement?
A high degree of detail is involved in the negotiations. We are aware that there is a huge need of power in India. I expect the initial agreement for the supply of two reactors will be signed by December-end and a final agreement should be in place early next year. We expect that by mid-2011, full implementation will begin.
High capital cost and per-unit rates are serious concerns. What efforts are being made to make these competitive and acceptable in India?
We are confident the EPR advanced technology will generate competitive power and it ensures stable and predictable rates over the very long term. To optimise costs, we are also looking for local partners in the field of designing, manufacturing and supply of reactors-related components. AREVA has already tied up with Bharat Forge; we are also talking to a couple of engineering companies and other players to form partnerships. It can be a cooperation agreement or joint venture. There is wide scope for cooperation, corresponding to AREVA’s integrated model. The Indian partners will be part of our global supply chain, not only designing, manufacturing and supplying projects in India but will also meet AREVA’s global requirements. There will be no compromise on quality and safety standards.
The partnership with NPC will be long-term. We will develop our own footprint, capabilities and network of suppliers, in support of NPC projects first, then of other projects on the world market.
Critics have raised questions over the applicability of EPRs.
The EPR design integrates the results of decades of research and development programmes, in particular those performed by the French Atomic Energy Commission and the Karlsruhe Research Centre in Germany. The licensing is unique, with a construction licence obtained in France, in Finland and in China, and licensing launched in USA and the UK. The EPR reactor is also reviewed by the MDEP, an international cooperation network between nuclear safety authorities.
The design offers significantly reduced power generation costs, compared to existing ones. Its technology allows for 15 per cent less uranium consumption with the same power output and it is fit for recycling spent fuel, as called for by India's nuclear policy. EPR reactors can also be operated in a flexible manner, at between 25 per cent and 100 per cent of nominal power supply, in a fully automatic way.
Is AREVA disappointed with the provisions of the Nuclear Liability Bill pertaining to the suppliers? Will it alter your strategy for India?
The bill has been passed by the Indian parliament. We know the necessary rules are being drafted. We sincerely hope the rules will create acceptable conditions for both Indian and foreign suppliers of nuclear design, equipment and services. We do hope that rules will be consistent with international practices. We have to wait to check.
