Westinghouse bailout fuels hope for India’s nuclear energy sector The new...

Westinghouse bailout fuels hope for India’s nuclear energy sector

The new year has brought a fresh ray of hope in India's nuclear energy sector with bankrupt energy company Westinghouse being sold to Canadian investment major Brookfield Business Partners this week.

Westinghouse is supposed to build six of its AP-1000 nuclear reactors in India, a project that had been delayed after the company filed for bankruptcy earlier in 2017. The $4.6 billion acquisition is expected to get the beleaguered US-Japanese company out of hot water. Toshiba, the owner of Westinghouse, had been looking to sell the nuclear business after it filed for bankruptcy.

Westinghouse had, in its discussions with the Indian government, assured that it would continue to work on the six reactors which are expected to come up in Kovvada, Andhra Pradesh. K M Rajan, former India representative of Westinghouse, told a nuclear energy conclave recently, “We expect to be out of bankruptcy Chapter 11 process sometime in early next year. We will be out of that, so it will not have any impact (on the nuclear project in India).”

There may be a need to tweak the plans somewhat, sources said. Reports quoted Westinghouse officials as saying that the company’s main focus after emerging from bankruptcy would be component construction. The company is expected to build six reactors in India — private sector and government entities are currently exploring whether a greater amount of indigenous components can be used to build these reactors, bringing down their costs as well as giving a fillip to Indian nuclear industry.

The immediate cause of its bankruptcy was the time and cost overruns that derailed four AP-1000 reactors in South Carolina and at Plant Vogtle in Georgia in the US.

Trying to allay concerns on this score, junior minister Jitendra Singh told Parliament this week, “The AP 1000 reactors of WEC are state of the art in terms of technology and safety and are comparable to the latest reactors developed by other countries. Their cost effectiveness in the Indian context would depend on the business models adopted and the current discussions are aimed at arriving at a viable project proposal.”

Singh added, “There is presently no change in the plan to set up nuclear power reactors at Kovvada in cooperation with M/s Westinghouse (WEC) of USA. Discussions are in progress between Nuclear Power Corporation of IndiaBSE -0.50 % Limited (NPCIL) and WEC to arrive at a viable project proposal. The filing of bankruptcy by WEC and subsequent developments have been noted and factored in the discussions. The project will be set up on emergence of a viable project proposal and accord of administrative approval and financial sanction of the government.”

Greater indigenisation, sources said, would bring down costs for Westinghouse. In fact, if this works, Indian officials plan to propose a similar template to French and Russian companies also building nuclear reactors in India.

Info: economictimes