Why Adani and Tata Power are turning to foreign nuclear reactors over local models

Industry heavyweights including Reliance, Adani, Tata Power, JSW, and Jindal Nuclear Power Private Limited have opened discussions with global suppliers across the US, France, Korea, Russia, and Japan. Their focus is on SMR technology, an emerging field that is still under active development worldwide.

Meanwhile, India’s domestic 220-megawatt Pressurised Heavy Water Reactor (PHWR) hasn't seen a new deployment since 2011, and core manufacturers have halted production of compatible nuclear turbines.

PHWR challenges 

The Nuclear Power Corporation of India Ltd (NPCIL) is currently working to adapt its 220 MW PHWR design into Bharat Small Reactors (BSR). Teams are drawing up modified blueprints to add steel liners alongside upgraded control and instrumentation systems to bolster overall safety.

“The last 220MW PHWR in India was deployed way back in 2011 and some of these units are still operational. The NPCIL is making changes to its design 15 years later and those design drawings are not available for now,” said a company spokesperson.

Equipment sourcing presents another steep hurdle for companies looking to set up the older 220 MW PHWRs. Major domestic suppliers like L&T and BHEL have discontinued manufacturing 220 MW turbines.

“If they want to start manufacturing these again, they would need to have sufficient order volume to again allocate some of their manufacturing space for this technology. At present, there is no other technology other than 220MW which is immediately available and this has its own challenges because it is on natural uranium, generating a lot of spent fuel which requires daily re-cooling,” added the spokesperson.

As India pushes toward a target of 100 GW in nuclear capacity by 2047, industry experts maintain that adopting a mix of multiple technologies will be essential for medium and long-term success.

Demand for smaller reactors 

To navigate massive initial capital costs, Indian firms want to start with smaller capacity reactors under 300 MW before scaling up to units exceeding 700 MW. However, operational track records for smaller units remain limited globally.

“Most of the existing operational foreign technology reactors are above 1,000 MW, whether it is French multinational EDF, US-based Westinghouse, or Russian state player Rosatom. Mostly, these reactor designs are available in twin construction means you have to take two reactors. So, if somebody is taking two 1,000 MW reactors, then your capacity becomes 2,000 MW, and their cost is very high,” said an industry spokesperson from the metal sector.

Industry estimates put the average cost of foreign reactors at ₹35 crore per megawatt, bringing a 2,000 MW installation to roughly ₹70,000 crore.

“A private developer may not be able to commit such huge investment in the first project, when they are entering the market. That is why many private developers are looking to start with a smaller unit. The cost of a 2X220MW reactor, having an average cost of ₹20-25 crore per MW, is around ₹8,800-₹11,000 crore,” said the spokesperson.

Need assessment 

Corporate interest in nuclear power is largely driven by captive power needs to hit zero-carbon targets. For operational resilience, businesses favour running four smaller reactors instead of leaning on a single 1,000 MW plant.

“Even when one of the reactors is under maintenance or one reactor is down, I will still be able to get 70-75% of the power. For captive users, a smaller unit is preferred so that you have multiple units and even if one unit is down, your plant is not stopped,” said the spokesperson.

Data centers, commercial operators, and heavy production sectors like steel, aluminum, and cement find utility-scale 1,000 MW reactors impractical. For these operations, smaller setups ranging between 220 MW, 300 MW, or up to 500 MW remain the functional choice.