Cost of Electricity from the Jaitapur Nuclear Power Plant

The Indian Government has announced that it plans to purchase six European Pressurized Reactors (EPRs) for Jaitapur from the French company, Areva. No EPR is in commercial operation anywhere else in the world. Estimates of costs from plants under construction in Finland and France suggest that each unit may cost as much as Rs. 60,000 crores; at this price, six units will cost Rs. 3.6 lakh crores. We show that the expected starting tariff from these reactors, without including transmission and distribution costs, is likely to be around Rs. 14 per unit (kWh) of electricity. We point out that existing revenue model used by the Government already involves a large loss for the taxpayer. The Government may seek to make the tariff from Jaitapur competitive by increasing the scope and nature of these handouts.