NPCIL moots GST waivers on nuclear power, parity with renewable energy

For smooth and swift implementation of projects, the Nuclear Power Corporation of India (NPCIL) has highlighted incentives such as GST waivers, parity with renewable energy sources and higher delegation of powers to the board on the lines of Maharatna companies.

These recommendations are critical for the state-controlled entity, considering that India is targeting a nuclear power capacity of 100 gigawatt (GW) by 2047, of which, NPCIL plans to contribute half.

The suggestions by the state-run nuclear power behemoth were shared with the Parliamentary Committee on Public Undertakings. The panel was initially briefed about the subject by NPCIL representatives on June 26 and by Uranium Corporation of India (UCIL) on July 21. It took evidence from both on July 31. The committee also took oral evidence from the Department of Atomic Energy (DAE) representatives on August 1.

Asked about suggestions on policy improvements or institutional support, NPCIL said: “All projects presently under implementation were sanctioned with mega-project concessions (mainly Excise Duty and Customs Duty), which have been rendered ineffective since the implementation of the GST regime, leading to cost increases.”

As electricity is not under GST, and input credit cannot be claimed, the mega-project concessions may be restored or GST waivers accorded for nuclear power projects, it added.

NPCIL pointed out that despite nuclear energy being clean power technology with life cycle carbons emissions comparable or lower than renewable technologies, it does not have any of the financial incentives that are available for renewables.

“Thus, nuclear may be provided a level playing field with renewables in terms of various incentives such as nuclear purchase obligation, green finance,” it suggested.

On support required from the Department of Atomic Energy (DAE), or the government, NPCIL said: “The support required from DAE and government is higher delegation of powers to NPCIL Board in all matters, equivalent to those of Maharatna companies.”

Another policy change required is in obtaining project financial sanction, wherein the NPCIL Board is empowered to accord financial sanction of projects funded by NPCIL equity, it recommended.

On the policy or regulatory bottlenecks faced by the company, NPCIL pointed out: “A regulatory bottleneck faced in executing projects on time is multistage reviews and clearances by regulator, even in case of projects based on repeat designs. It has been suggested that while in respect of first-of-a-kind reactors, existing regulatory processes need to be followed, in respect of repeat designs, regulators may issue a consolidated clearance.”

Similarly in respect of Environmental Clearance also, a single window clearance by one authority would help reduce time taken in obtaining statutory clearances, it added.

Other suggestions shared by the nuclear power major with the panel include inclusion in national green taxonomy, removal of nuclear power projects from ‘Red’ category listing by Central Pollution Control Board (CPCB), evolution of an institutional mechanism to resolve issues with states and providing more Nuclear Liability Insurance Providers.