Whalesbook
India's Nuclear Push
India is strategically repurposing retired coal power plant sites for new nuclear energy projects. This initiative aims to dramatically increase the nation's nuclear capacity to 100 gigawatts (GW) by 2047. The SHANTI Act, passed in December 2025, is a key driver, opening the door for private sector investment and updating liability laws. These changes are vital for attracting the significant funding needed to reach the ambitious goal. Previously, nuclear power generation was restricted to state-owned entities under the Atomic Energy Act of 1962 and the Civil Liability for Nuclear Damage Act of 2010. The SHANTI Act repeals these, removing barriers to private participation. Investor interest in the sector is reflected in the BSE Power Index, trading around ₹7968.40 with a P/E of 37.28, aligning with government policy. Using existing thermal sites offers a more efficient use of land and infrastructure compared to building new facilities from scratch.
Site Rules and Small Reactors
A key hurdle is the Atomic Energy Regulatory Board (AERB) guideline requiring a 1-kilometer exclusion zone around nuclear reactors, which prohibits habitation and economic activity. However, proposals to reduce this zone have received in-principle approval from the AERB and the Department of Atomic Energy. The plan is to shorten the exclusion area to about 700 meters for large reactors and 500 meters for smaller units. This could significantly reduce land requirements and allow for two to three times more generating capacity on existing sites.
Small Modular Reactors (SMRs) are also seen as a solution for these brownfield sites and for powering new demand centers like data centers and industrial hubs that need reliable power. SMRs can be built faster in factories and require lower initial investment, potentially cutting financing costs. India aims to produce SMRs at least 30% cheaper than global competitors, with estimated costs around ₹30 crore per megawatt (MW), compared to international quotes of ₹50-100 crore per MW. While larger reactors remain key for overall capacity, SMRs offer flexibility and are suitable for captive power needs.
Risks and Roadblocks
Despite the progress, the plan faces significant challenges. The successful reduction and formal implementation of exclusion zones are critical; delays could force a shift to more expensive new sites. The economic viability of SMRs hinges on securing large, long-term orders to achieve factory production efficiency and economies of scale. Without these, projected cost savings might not materialize, affecting project financing.
Furthermore, India's domestic uranium production is low, requiring substantial imports that create fuel security and geopolitical risks. Adapting regulations for modular, distributed nuclear power also presents licensing, siting, and operational challenges. Historical project execution in India's nuclear sector has seen delays and cost overruns, posing a risk to the aggressive timeline for reaching the 100 GW target.
What Lies Ahead
India's plan is ambitious, targeting 22 GW of nuclear power by 2032 and reaching 100 GW by 2047. This requires faster project execution, strong supply chains, and sustained large-scale financing. Translating policy reforms into investable projects with clear rules, timelines, and de-risking for early investors will be key. Analysts expect nuclear power to play a larger role in India's energy mix, but its success depends on overcoming the regulatory, economic, and execution challenges.