Major changes on the Civil Liability for Nuclear Damage (CLND) Bill 2010 including trebling compensation and the extension of liability to private firms should see the opening up of Indian $150 billion nuclear power market as also pave the way for an early enactment in both Houses of Parliament.
The parliamentary panel has suggested that compensation be raided to Rs 1,500 crore which is still much less than what an operator would be liable to pay in the United States. Nevertheless, if passed by Parliament, the CLND will ensure that nuclear companies including the US conglomerates such as General Electric and Westinghouse Electric can tap India’s nuclear power market.
These private companies had been demanding clarity on the entire on the accident compensation before making their debut. Indian companies including Tata Power, L&T, GMR and Jindal were keen to be given a share of the nuclear power market. However, they have been excluded but will be allowed to operate as minority partners of the National Power Corporation of India Ltd (NPCIL).
For the present, preference will be given to state — run companies including the National Thermal Power Corporation and Indian Oil Corporation to enter into joint venture agreements with the NPCIL.
The new bill allows for compensation to be paid within a three-month period though the extension of the period of claim in the event of a nuclear accident has been increased from ten to 20 years, the creation of a Nuclear Liability Fund and the making of a specific mention that the operator of a plant could only be the government.
“Creation of such a fund would reduce the government liability in the course of time,” said T. Subbirami Reddy, chairman of the Parliamentary Standing Committee on science & technology. “We propose to charge four paise per unit of electricity generated by a nuclear power plant as contribution to the fund,” said Mr Reddy.
Mr Reddy said he was unable to understand the reason behind the Left parties demand to raise the cap on compensation to Rs 10,000 crore from the earlier Rs 500 crore. On how the liability would be worked out in case of a joint venture company involving a private sector firm as a minority partner, Mr Reddy merely said, “As of now (private players) are not coming.”
A secretary pointed out, “The government had some reservations on how Indian corporate houses would have handled the compensation issue given they would have had to go through insurance companies.”