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nuclear is in!! (great read!)

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    Nuclear is in!

    Capacity can be added and priced competitively

    Posted online: Saturday, September 10, 2005 at 0000 hours IST




    The atomic energy department’s proposal to set up around 3,400 mw of new generation capacity is an incremental move at a time when we need large initiatives in the nuclear domain. At present, nuclear power is a mere 2.5% of overall installed power generation capacity. But stepping on the nuclear pedal requires more than simply placing a few projects on the table from time to time.



    So, how do we accelerate nuclear capacity addition at competitive pri-ces? For a start, place bulk orders as against project-specific orders, as is the current practice. This will not only reduce procurement cycles, but also pare capital costs. Real gains can be extracted by reducing the project construction period, where we have fared dismally. Globally, it is around four years and is dropping. The gains can be huge, since nuclear plants envisage high capital costs and reducing the construction time will pare interest cost and consequently the rates. Public-private partnerships can help, as these would incorporate best-in-class project management skills.

    Competitiveness of nuclear power is definitely on the ascend with rising coal and gas prices. Recent disclosures by a US utility shows that nuclear power becomes cheaper than coal within a few years of operation. However, notwithstanding the favourable economics and advances in safety technology, nuclear power is fraught with risks. The best way to ensure a check on risks is to list nuclear companies on the stock exchange, as is common in Europe. Resource constraints can be overcome by divesting minority stakes in the existing capacity. And, the lure to invest in existing plants is greater than in the case of coal or gas for nuclear plants live longer, twice longer than coal plants.

    There is, however, a caveat. What if uranium reserves become scarce or if the inflamed fuel prices spread to uranium, a fuel we import? We, therefore, need to lock into long-term contracts at fixed prices in the global uranium market and quickly commercialise fast-breeder reactors that operate on thorium, a substance found abundantly in the country.

    http://www.financialexpress.com/fe_full_story.php?content_id=102041
 
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