SHANTI Bill: Cost and tariff key for private sector investment in nuclear energy

The Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India (SHANTI) Bill, 2025, which opens private players’ entry into nuclear power, addresses concerns related to operator liability norms. However, high capital costs, execution risks and tariff competitiveness remain a challenge.

The Bill, if passed, aims to transition India from a tightly controlled, state-dominated nuclear sector controlled by the Nuclear Power Corporation of Indian Limited (NPCIL) to a more diversified model that permits regulated private participation while maintaining government control over sensitive activities.

The NPCIL has already received interest from private players for building Bharat Small Reactors (BSRs), but the industry is waiting for the legal amendment to take it forward.

Experts say nuclear power is uncharted territory for the private sector and there are inherent challenges related to high capital costs and tariffs.

“The SHANTI Bill paves the way for private participation in India’s nuclear power sector, which until now has been exclusively operated by public sector entity NPCIL. This reform aims to accelerate capacity expansion toward the government’s 100 GW target by 2047,” says Ankit Jain, Vice President and Co-Group Head, Corporate Ratings, ICRA Ltd.

He says the Bill seeks to address the private sector’s main apprehension by introducing clearer operator liability norms (capping it at Rs 3,000 crore) along with eliminating the right to recourse on suppliers for defective equipment, that previously deterred private participation. The Bill largely aligns supplier liability with global practices.

“However, the sector faces inherent challenges including extremely high capital cost (Rs 16–20 crore per MW), long gestation periods, and plant stabilisation-related issues. Private firms lack the operational track record in this domain, raising concerns over execution risks and tariff competitiveness,” he adds.

The government states that the new Bill aligns with India’s climate commitments, including its net-zero target by 2070 and an ambition to scale nuclear capacity to 100 gigawatts by 2047, up from approximately 8.2 GW today.

Karthik Ganesan, Fellow and Director–Strategic Partnerships, Council on Energy, Environment and Water (CEEW), says the passage of the Bill will mark a milestone for India. “It will signal to capable private sector players that the country is open for business in the nuclear energy space and is committed to a future where nuclear power provides the clean baseload energy we currently rely on coal for,” he says.

Ganesan emphasises that implementing this vision will require strategic thinking and a long-term commitment to a technology whose costs are locked in for the next 50–60 years.

India’s existing nuclear laws, the Atomic Energy Act, 1962, and the Civil Liability for Nuclear Damage Act, 2010, have long been flagged by the industry and foreign suppliers as deterrents to investment. The liability law, in particular, placed open-ended exposure on equipment suppliers, making global reactor manufacturers reluctant to enter the Indian market.