Blinkered Vision: Unravelling the Nuclear Debate

Majumdar:

"Regulators both at the state and central level are taking a close look at costs being offered by the power producers before approving tariffs."

This is exactly where the problem starts - looking at costs. Try figuring out how the cost of capital should be calculated and you will get into all the problems associated with average cost pricing. The man behind "competitive power sector" in India is Kirit Parikh. He is corrupt and an arrogant idiot.

Majumdar,

Thanks for that. Once the centralised mode of electricity generation is replaced by distributed mode with photovoltaics and wind power, the savings are phenomenal, typically the parasitic loses, due to wire resistance, the inductive current flows etc account for nearly 30 percent in india, which will be reduced dramtically as the locally produced electricity will be consumed locally.

I do believe that a low energy development path is possible in India.

As you might be aware, 50 percent of diesel fuel is used by the railways, and jatropha oil is being trialed for teh railways.

In any case, nothing much in terms of electricity will be lost if teh 123 agreement becomes 123 0 agreement.

GT,

(Whatever be the scenario, production costs will be subsidized OR competition will be restricted and prices will be regulated through average cost pricing.)

Increasingly the trend in the domestic power sector is to go for competitive price based bidding. Regulators both at the state and central level are taking a close look at costs being offered by the power producers before approving tariffs.

Regards

Generation will be done by private-public set ups, mostly private (I think). Financing will be sourced through international secondary markets.

Whatever be the scenario, production costs will be subsidized OR competition will be restricted and prices will be regulated through average cost pricing. The providers and financiers will ask for ex-ante commitment. Once this is done, everything will be done through back-room negotiations (which may already have started).

In short:

Potential growth of the market will be deliberately curtailed (regulated) to facilitate large payoffs to nuclear producers when they enter the market. This process must already have started. But nobody is talking about it openly. Behind closed doors, political parties must be demanding their pound of flesh.

I do not see excess-demand vanish in the Indian market over the next 15-25 years. I am not saying that the nuclear agreement is necessarily bad. I do not give a damn about nuclear weapons etc. I just do not mant to see Dhabol/Enron re-enacted on a massive scale.

Jayp,

(Coal fired what is termed the ultra mega powerplants of 4000 MW each are coming up in the private sector with current price of approximately Rs 2 per Kwh with 25 year contract.)

The ultra-mega power projects based on locally sourced coal are promising power at much less around Rs. 1.20/unit, while imported coal based are promising power at Rs. 2.20/unit.

Regards

HP 26,

Money at least for now is not a problem. Coal fired what is termed the ultra mega powerplants of 4000 MW each are coming up in the private sector with current price of approximately Rs 2 per Kwh with 25 year contract.

These power stations operating at around 2000 Kg/cm sq pressure, called super critical steam are highly efficient.

So nuclear power with only one source of supply has a high degree of risk.

India is likely to develop in a low energy intensive manner, to give an example Indian installed power capacity is around 100 GW, china around 500 Gw and the US around 900Gw

HP sain,

(Indian will invest heavily in developing nuke energy and all that investment will be dependent on the US goodwill.)

Deal or no deal, N-power will remain a marginal source of power in India. Coal (local or imported) will continue to dominate, followed by hydel and gas (if available at reasonable prices).

Regards

Re: # 26 Let us hope people of India defeat plans of Govt of India to enslave India. It is good it was not offered to us otherwise unwise rulers of pakistan would have become slave without bickering. All if america is not involved in India is better. Our neighboorhood should be free of western domination which can lead to troubles. It has advantaged power crippled India can not make easily war on pakistan. One should have no sympathy in power politics. Tour sympathising is not good. Indian progress is not good for all its neighbourhood. Pakistan and china should form joint alliance for energy and pak- china companies can bid on big mineral exploration areas. China is developing and putting lots of money in oil areas we can be partner in , also invest money in China neclear power plant engineering similar to joint fighter airplane production. Iran is goos partner, Irans emnormaus mineral energy resources combined with our techanical expertise and technical man power will help Iran and power demand in pakistan. Any way hopefully India usa dael is already dead for good

"A new 1,400-megawatt nuclear power plant is going to cost about $2.6 billion," he said. "It is going to take 6 1/2 years to build.” WP

The cost now is about $3 billion and large plants could cost up to $10 Billion.
I don’t know how many Indians have planned to build. Simply put, India does not have the money to pay for them. And like any other big ticket Investment, India will have to borrow the money from the International Banks (mostly US). ) major % of the equipment will be bought in the US. These are some solid reason to support the agreement as India on its own can never get this going.

With the US in the agreement, financing and equipment and the technical know-how would be of enormous help. This is a double-edged sword. While the benefits are enormous, the downside has huge implications too. With this kind of investment going in India, the US banks will certainly gain a good control over Indian fiscal policies. The equipment supplier will too gain policy changing voice in Indian affairs. The US government will not only be the spokesperson for the finance and the equipment suppliers but it will also be the arbitrator of the disputes that India will have with monitoring agencies.

The same equipment suppliers are the arms manufacturers too. So India will have to buy for its defense needs real or created, from these suppliers. These suppliers excel in cross selling and bribery both.

Pakistan’s entry in to the US sphere started with the Korean War when the US allowed Pakistan to make enormous sums of money and then turned round and made the Pakistan army dependent on the US arms supplies. With two major punches in the US hands, it was not difficult to sign Pakistan on for supporting the US for generations to come.
The pattern in this deal is quite obvious too.

But really what options third world countries have? They have their national aspirations and I can fully sympathize with the dilemma that the Indian government faces. Power demand can never go down. With 60% population going dark every evening and not having the ability to support the power needs of heavy industry, India has to bend.

The national interests sometimes can be achieved by compromising lots of positions and India is at the stage where it feels that by bending over now, it might secure the future.
It may be illusory but nationalists often make this type of choices. With the US, Indian can only hope for the best.

#21 Posted by dost_mittar on October 14, 2007 2:57:35 am

read up on thorium reactors. google india and thorium reactors.


‘Indo-US nuclear deal not perfect, but a net plus’


Chennai, Sept 10

The Indo-US nuclear deal has been the most controversial issue in recent weeks, even leading to speculation of a mid-term election in the event of a likely withdrawal of support to the ruling UPA coalition Government.

Those opposing the deal, chiefly the Leftist parties, point to the possibility of Indian interests becoming subservient to those of the US should the agreement be finalised in its present form.

But Dr S. Paul Kapur, a visiting professor at the Center for International Security and Co-operation (CISAC), Stanford University, thinks that the Indo-US nuclear deal, “while not perfect, is a net plus.”

Interacting with Business Line over the email, Dr Kapur, who is the author of ‘Dangerous Deterrent: Nuclear Weapons Proliferation and Conflict in South Asia’ (Stanford University Press 2007), conceded that there are a nu mber of legitimate concerns being voiced by most of the deal’s detractors in the US, but added that the deal has likely economic, strategic and diplomatic benefits for India.

HP,

Pakistani unhappiness with the agreement is an excellent sign for Indian to give it a go ahead, but the following paragraph is quite relevant:

"The sticky about this agreement is that in the next 40 years, US is the only country that can cancel this agreement. Which means India cannot walk away from it or find other supply sources without the US approval first. The agreement implies that Indian cannot even use homegrown material without getting the US approval!"

If that is true, then we need to be careful with what we are doing.

I would love to hear from some non-leftist Indians on these spcific points. Thanks in advance.

#22 Posted by HP on October 14, 2007 9:40:23 am


If at certain point in future the US is unhappy with India for any reason, Indians will see all their investment come to naught within minutes of an adverse US decision.


HAHA....the grapes are not only sour but they are poisonous and will kill you..

“An editorial in Indian express averred, 'We must not loose sight of the broader picture. America is now the only super power. It is in our self interest to align with them. The greatest democracy on earth and the largest would have natural congruity of interests. If we don't, ...'.”

Welcome to slavery!

The above is really the only argument that BJP nuts have going for them.
The sticky about this agreement is that in the next 40 years, US is the only country that can cancel this agreement. Which means India cannot walk away from it or find other supply sources without the US approval first. The agreement implies that Indian cannot even use homegrown material without getting the US approval!

Indian need for power generation is not exaggerated. They need that source but the Nuke tests of 90s have permanently closed the door for India to get nuke power plants going without mortgaging the national interests. The hoopla that lasted little more than couple of weeks has created this situation.

With this agreement India will not only kiss its nuke option goodbye but this will also end the Indian dream of matching China as the regional power. After signing this agreement, India will never be able to dangle its nuke against Pakistan. Initially the nuke tests were done to intimidate Pakistan. That option is about to go away too as Pakistan will retain its ability to conduct nuke tests and India will not.

Indian will invest heavily in developing nuke energy and all that investment will be dependent on the US goodwill. If at certain point in future the US is unhappy with India for any reason, Indians will see all their investment come to naught within minutes of an adverse US decision. The Indian foreign and domestic policies will depend on the US pleasure and India will be another Afghanistan of the area.

Welcome to the club!

Scientists speak out:

Scientists appreciate government's stand on N-deal

October 14, 2007 15:12 IST

After Prime Minister Manmohan Singh's [Images] assertion that he will not put the government at stake over the Indo-US nuclear deal, scientists on Sunday hailed the stand saying the Centre has taken a sensible decision.

"It is the most sensible thing the government has done," former Atomic Energy Commission Chairman H N Sethna said, welcoming the remarks of Dr Singh.

"Ours is not a one-issue government and it will do all it can to avoid early polls," he said.

The UPA-Left stand-off over the Indo-US nuclear deal had given rise to the possibility of a mid-term poll. Dr Singh's statements on Friday along with Congress president Sonia Gandhi [Images] had put this speculation to rest.

Sethna said, "India is a huge democratic country and it is okay even if the process goes slow. We are not going to die. It all depends on 'how we define our objectives and the time table we chalk out for ourselves."

Dr P K Iyengar, also former Chairman AEC said: "The government made a mistake by not allowing the debate on the deal in Parliament. They should have shown the maturity of parliamentary democracy by having a debate."

He added that the 123 agreement was not a perfect document and was not done in a scientific way. There was always a danger of interpretation of it in favour of the US.

On the reprocessing issue, Iyengar said it was a blunder on part of India to have announced about the dedicated reprocessing facility and 'in fact this got into problems as such a facility can never be built.'

India should not allow the US to take rest of the world for granted, Iyengar said.

Iyengar said, even Jawaharlal Nehru did not allow advanced countries, in early 1950s for uranium mining here, as he said India was a sovereign country, Iyengar added.

Reacting to the recent statement by the Director General of International Atomic Energy Agency Mohammed ElBaradei on safeguards that 'the Indian government will have to take a decision and I will wait for them to come to Vienna to make a formal request (in this regard),' he said: "Does it mean, whatever informal consultations that were done by the Indian officials during the last one year has gone waste and was he (ElBaradei) calling for fresh negotiations?."

M R Srinivasan, member AEC, also echoed the similar sentiments and said, "The delayed deal is better than a bad deal. If we could bring the political consensus in a most democratic way, the current situation would not have arisen."

It is a fact that Hyde Act language is not India-friendly and the 123 agreement reflected that to some extent, he said.

"The only thing, if the deal had gone through, would have been that it would have paved way for India's integration into international arena," he added.

"Of course, we have to go by the decision of the country that is good for the country and as scientists we can only explain the situation and its pros and cons," Srinivasan said.

"We will continue with our indigenous programmes and look for more uranium reserves. Meanwhile, the two Russian reactors are under construction and some spade work is also being done with enthusiastic French nuclear industries," he concluded.

Dr A N Prasad, former BARC director and special envoy of IAEA on Iraq WMD, said unlike other bilateral agreement where they constitutionally bypass the Parliament, the bilateral deal on nuclear energy should have been considered little more seriously as involved commitment in perpetuity.

He said when most of the Parliament was opposing the deal the government should have gracefully or proactively allowed some discussion and taken a consensus.

Even when the 123 agreement was placed in the Parliament, it was a frozen document. There was no scope for fine tuning at all, Prasad said.

Prasad was also upset about the statements made by very senior politicians and diplomats on those who were just expressing their concerns on the deal.


"Are we not supposed to express our views? It was unbecoming of democracy," Prasad added.

He also pointed out that even if the deal comes through, the embargo would have got lifted only for the reactors and not for the equipment and technologies of entire fuel cycle.

The noise being made is about bombs and testing. Its about the huge electricity market and related kickbacks stupid.

jayp, the starting point is: if Anand Patwardhans of this world oppose the deal, it must be good for the future of India and for Indian citizens.

But you raise an excellent issue of dependence on the US. Dr. Manmohan Singh and his team of negotiators and strategic thinkers (one hopes) are looking into it.