{"id":1193,"date":"2025-02-18T06:03:54","date_gmt":"2025-02-18T06:03:54","guid":{"rendered":"https:\/\/blogs.isb.edu\/bhartiinstitute\/?p=1193"},"modified":"2025-12-31T09:30:27","modified_gmt":"2025-12-31T09:30:27","slug":"revitalising-indias-energy-future-why-nuclear-energy-is-indispensable","status":"publish","type":"post","link":"https:\/\/blogs.isb.edu\/bhartiinstitute\/2025\/02\/18\/revitalising-indias-energy-future-why-nuclear-energy-is-indispensable\/","title":{"rendered":"Revitalising India\u2019s Energy Future: Why Nuclear Energy Is Indispensable?<\/strong>"},"content":{"rendered":"\n

Introduction<\/strong><\/p>\n\n\n\n

Recent disasters such as the wildfires in California and environmental crises closer home like the devastating forest fires in Uttarakhand, underscore the urgent need for sustainable energy solutions. These events serve as grim reminders of the accelerating impacts of climate change and humanity’s role in it. For a country like India, balancing rapid economic growth with environmental sustainability has never been more critical. A key part of the solution lies in harnessing the power of nuclear energy\u2014a reliable, low-carbon alternative that aligns with India\u2019s ambitious climate goals and energy security needs.<\/p>\n\n\n\n

The Case for Nuclear Energy in India<\/strong><\/p>\n\n\n\n

India is no stranger to energy challenges. With a population of over 1.4 billion and an economy poised for exponential growth, the country faces an insatiable demand for electricity. Currently, fossil fuels account for nearly 80% of India\u2019s electricity generation, contributing significantly to greenhouse gas (GHG) emissions. While renewables like solar and wind have gained momentum, their intermittency and land-intensive nature make them insufficient to meet the country\u2019s energy needs on their own.<\/p>\n\n\n\n

Nuclear energy offers a compelling alternative. It provides a steady, high-capacity power supply with minimal carbon emissions. According to a study published in the International Journal of Energy Economics and Policy<\/em>,<\/a> a 1% increase in nuclear energy use could lead to a long-term reduction in GHG emissions by 0.16%, underscoring its potential as a climate solution. Notably, India\u2019s nuclear power generation has been growing at twice the global average. In 2023, India\u2019s nuclear energy capacity expanded by 4.4%, compared to the global average of 2.2%, demonstrating the country\u2019s commitment to this clean energy source.<\/p>\n\n\n\n

Additionally, the Union Budget 2025-26 has reaffirmed the government\u2019s commitment to nuclear energy expansion by allocating a substantial portion of the \u20b911,21,090 crore capital expenditure towards clean energy projects, including nuclear power. Further, the Nuclear Mission for Viksit Bharat has been launched, aiming for 100 GW of nuclear power generation by 2047 as an essential component of India\u2019s energy transition. The budget also includes an outlay of \u20b920,000 crores for research and development in Small Modular Reactors (SMRs), with at least five indigenously designed reactors set to be operational by 2033. Additionally, to ensure active private sector participation, amendments to the Atomic Energy Act and Civil Liability for Nuclear Damage Act are in the pipeline.<\/p>\n\n\n\n

Nuclear energy also contributes to grid stability, a significant challenge with the integration of renewables. Unlike solar and wind, nuclear power provides consistent and uninterrupted electricity, crucial for maintaining grid reliability. Advanced reactor technologies, such as Small Modular Reactors (SMRs), further enhance this stability with their scalable and flexible designs, making them ideal for India\u2019s energy landscape. SMRs, with capacities ranging from 50 MWe to 300 MWe, can address localised energy<\/a> needs while reducing infrastructure costs.<\/p>\n\n\n\n

In addition<\/a>, nuclear power contributes to energy security by reducing dependence on fossil fuel imports, which account for nearly 85% of India\u2019s oil and 50% of its natural gas consumption. This heavy reliance on imports exposes the economy to volatile global energy prices, making domestic nuclear energy a more stable and predictable alternative. Moreover, nuclear power plants operate with a capacity factor exceeding 80%, outperforming renewables like wind and solar, which often average below 35% due to weather variability.<\/p>\n\n\n\n

Public Perception and Policy Challenges<\/strong><\/p>\n\n\n\n

Despite its benefits, nuclear energy often faces public resistance due to safety concerns, waste management, and the memory of nuclear catastrophes such as Fukushima and Chernobyl tragedies. However, public opinion in India appears to be evolving. A nationwide survey found substantial support for nuclear energy, with many Indians recognizing its role in addressing energy security and climate change<\/a>.<\/p>\n\n\n\n

The Indian government has already laid the groundwork for nuclear expansion. With 22 operational reactors and plans to increase nuclear energy\u2019s share from 3.2% to 25% by 2050, India is well-positioned to capitalise on this technology. Additionally, partnerships like NTPC\u2019s recent collaboration with U.S.-based Clean Core Thorium Energy highlight India\u2019s focus on innovative solutions such as thorium-based nuclear technology to strengthen its energy mix. Notably, the government has recently invited private participation<\/a> in nuclear power projects, a historic first aimed at decentralising and accelerating nuclear power development. The Nuclear Power Corporation of India Limited (NPCIL) has proposed Bharat Small Reactors (BSRs), which offer a compact, cost-effective solution for captive use, thus encouraging investments from private entities.<\/p>\n\n\n\n

Thorium: A Strategic Advantage<\/strong><\/p>\n\n\n\n

India\u2019s abundance of thorium presents a unique opportunity to lead the global nuclear energy transition. Thorium-based reactors, such as Advanced Heavy Water Reactors (AHWRs), offer several advantages over traditional uranium-based systems. They produce less nuclear waste, are inherently safer, and can operate at smaller capacities, making them suitable for India\u2019s diverse energy landscape.<\/p>\n\n\n\n

Thorium\u2019s strategic advantages are especially critical given India\u2019s vast reserves, estimated at over 846,000 tonnes\u2014among the largest in the world. These reactors not only reduce India\u2019s reliance on imported uranium but also mitigate the risks associated with long-term waste storage. Advanced thorium technologies also align with India\u2019s goals under the Paris Agreement by providing a viable path to significant carbon reductions.<\/p>\n\n\n\n

The development of Small Modular Reactors (SMRs) and thorium-based technologies could revolutionise rural electrification and reduce dependency on coal. SMRs, with their modular design and ability to operate independently of large grid systems, are particularly suited to India\u2019s remote and underserved regions. By integrating SMRs into microgrids, India could electrify its last-mile rural communities, significantly improving socio-economic outcomes in these areas.<\/p>\n\n\n\n

Learning from Global and Local Contexts<\/strong><\/p>\n\n\n\n

The recent wildfires and extreme weather events highlight the dire consequences of inaction. Countries like France and South Korea have demonstrated how nuclear energy can provide a reliable backbone for clean energy systems. France, for instance, derives approximately 70% of its electricity from nuclear power, which has helped the country maintain one of the lowest per capita carbon footprints among industrialised nations.<\/p>\n\n\n\n

Locally, the environmental degradation caused by deforestation, mining, and unregulated urbanisation further emphasises the need for cleaner energy alternatives. The construction of nuclear facilities, though capital-intensive, has a relatively low environmental footprint compared to coal mining and hydropower dams, which displace communities and disrupt ecosystems. Additionally<\/a>, India\u2019s recent achievements in reducing PM2.5 pollution levels by 27% in six years underscore the critical role of sustainable energy policies in improving public health and environmental conditions.<\/p>\n\n\n\n

Role in Financial Re-engagement<\/strong><\/p>\n\n\n\n

An important consideration is the recent withdrawal of major financial institutions from financing certain climate initiatives under the Conference of the Parties (CoP) framework due to perceived inefficiencies or risks. In January 2025, JPMorgan Chase, Bank of America, Citibank, Wells Fargo, Goldman Sachs, and Morgan Stanley collectively withdrew from the Net Zero Banking Alliance (NZBA), an industry-led group committed to aligning financing with net-zero emissions by 2050. These banks cited regulatory pressures and concerns over restrictive investment policies as key factors in their decision.<\/p>\n\n\n\n

Nuclear power, with its proven reliability and scalability, could act as a catalyst to re-engage these institutions. By offering a secure investment opportunity that aligns with both financial and climate goals, nuclear projects such as Bharat Small Reactors (BSRs) and Thorium-based technologies can attract long-term funding. Unlike some renewable energy projects, which are criticised for intermittency and land use, nuclear energy provides consistent power and lower lifecycle costs. Encouraging consortiums of banks to reinvest in nuclear energy would not only support climate objectives but also create financial stability in the energy sector.<\/p>\n\n\n\n

Policy Recommendations<\/strong><\/p>\n\n\n\n

Accelerate Development of Thorium Reactors: Leverage India\u2019s Thorium reserves to develop advanced nuclear technologies, supported by targeted R&D investments.<\/p>\n\n\n\n

Strengthen Regulatory Frameworks: Ensure robust safety standards and transparent communication to build public trust.<\/p>\n\n\n\n

Promote Public-Private Partnerships: Encourage collaboration between government bodies and private entities to fund and manage nuclear projects efficiently. Recent moves to invite private sector participation in projects like Bharat Small Reactors (BSRs) should be expanded and incentivised.<\/p>\n\n\n\n

Integrate Nuclear with Renewables: Develop hybrid energy systems that combine the reliability of nuclear with the scalability of solar and wind.<\/p>\n\n\n\n

Enhance Public Awareness: Launch educational campaigns to address misconceptions and highlight the benefits of nuclear energy.<\/p>\n\n\n\n

Focus on Export Potential: Develop nuclear technology for international markets, establishing India as a global leader in clean energy innovation.<\/p>\n\n\n\n

Re-engage Financial Institutions: Position nuclear energy as a stable, scalable investment to attract banks and financial consortiums back to financing clean energy projects.<\/p>\n\n\n\n

Conclusion<\/strong><\/p>\n\n\n\n

As India aspires to achieve net-zero emissions by 2070, the role of nuclear energy cannot be overstated. It is not merely an option but a necessity for ensuring energy security, mitigating climate change, and sustaining economic growth. By embracing nuclear power and pioneering thorium-based technologies, India can lead the way in building a sustainable, energy-secure future\u2014a legacy that safeguards both the environment and the aspirations of its people.<\/p>\n\n\n\n

Also, the latest Union Budget 2025-26 has sent a clear signal about India\u2019s commitment to nuclear energy. With substantial allocations towards clean energy, nuclear research, and private sector participation, India is well-positioned to make nuclear power a cornerstone of its long-term energy strategy. Moreover, as major financial institutions reassess their climate financing strategies, nuclear energy presents a stable and bankable investment that can attract global capital.<\/p>\n\n\n\n

With the\u00a0Nuclear Mission for Viksit Bharat, aiming for 100 GW of nuclear power by 2047, and an outlay of \u20b920,000 crores dedicated to Small Modular Reactors (SMRs), India\u2019s nuclear sector is poised for rapid transformation. These initiatives will not only ensure energy security but also contribute significantly to India\u2019s climate commitments and economic resilience.<\/p>\n\n\n\n

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\"\"<\/figure>\n<\/div>\n\n\n\n
\n

Author\u2019s Bio: <\/strong>Anil is the Founder and Director at\u00a0House of Capitals, an investment house focused on strategic asset allocation and value-driven investments. An\u00a0alumnus of ISB\u2019s Advanced Management Programme in Public Policy (AMPPP) (Batch 2023), he is a keen policy observer, passionate about bridging\u00a0economics and ecology\u00a0to drive sustainable development. With a\u00a0PhD in Behavioural Finance, Anil brings a unique blend of\u00a0technology, analytics, and business acumen\u00a0to create meaningful financial and policy outcomes. His experience spans\u00a0policy advocacy, investment strategies, and digital transformation, with a strong emphasis on stakeholder engagement and economic sustainability.<\/p>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

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