 Hello and welcome to NewsClick. Today we're going to be talking about the leading nuclear energy supplier, Westinghouse, which has filed for bankruptcy in US and what are the impacts it's going to have on the nuclear industry. For this we have with us, Prabir Purkayastha, NewsClick, chief editor and also an energy expert. So the leading nuclear reactor manufacturer, Westinghouse, has filed for bankruptcy in US. How is this going to impact the nuclear industry globally and in India? The nuclear industry has two major problems. A, the cost overruns keep on growing, mainly because as we learn more and more about nuclear power, we seem to need more and more protection, we need to see more and more engineering changes to be made and as a consequence the cost goes high as well as you get what are called time overruns. So nuclear projects, wherever they are, whether they are Arriva doing a set of projects in Europe or it is Westinghouse doing a set of projects in the US, both have seen very high cost and time overruns. So as a consequence, both for the companies who are building this nuclear power plants, the construction companies, Westinghouse which was the reactor supplier or the ones who are going to own this companies, both of them get into a lot of financial difficulties and this is also today coupled with the fact that you have a lot of gas available. The hydrocarbon price, gas and oil prices have fallen dramatically and particularly gas prices in the US are such that nuclear power really cannot compete against it. We also have what are called renewable power, solar being the prime example, wind also is another of the renewables which have seen considerable development recently. All of it show that there is a continuous loss of competitiveness of the nuclear industry vis-à-vis other energy sources. So really we have two sides of the coin, one side the cost of nuclear energy is rising, other side the cost of renewables are dropping and dropping drastically including the cost of non-renewables like gas which have also dropped. So we are seeing really nuclear power not being competitive. This is something that we had warned well ahead of its time in India itself that this is not going to work. The worldwide this has been a continuous set of messages given by different set of experts, unfortunately nuclear industry is a very powerful lobby because also backed by a whole set of political forces have disregarded the clear evidence of this and has pushed this argument because of climate change, because of carbon emissions being high in terms of impact on the global climate therefore nuclear should be brought back. I think this is the end of that story. So does that mean that the nuclear renaissance and the nuclear power industry revival that has been talking about that was talked about is coming to an end it's over? It's clearly over. You can see what is the impact for instance on the two major nuclear reactor suppliers in the west. One was France Arriva. If you remember France's history it had at 1.80% of its energy needs being met by nuclear power. It had a very strong nuclear industry which created this nuclear reactors and invested a huge amount of money in this. Arriva for the last 8 to 10 years has been struggling to build one nuclear reactor in Finland and in fact the project has seen such huge overruns that now the construction companies again and Arriva and Siemens who have all involved in the project as well as the owners of the plant the Finnish electricity utility are against each other in courts who is responsible for the losses. It's a huge cost and price overrun. The cost of the plant is increased by almost 3 times. The cost of electricity as a consequence would go up really again almost by 3 times and the time overruns means that this project which should have been on stream 4 years back has not come on stream even today. So this is Arriva. You have General Electric which is another major builder of nuclear reactors. It's also pulling out of this business. Westinghouse was acquired by Toshiba about a few years back and Toshiba thought that the nuclear renaissance means that with Westinghouse and Westinghouse it said the Westinghouse designs and built reactors are about 50% of the world's total reactor population. So it was probably the most important player in the nuclear reactor business. So Toshiba acquired Westinghouse about a few years back in the belief that they would be able to hold in the pole position in the revitalized nuclear industry which the thought would take place because of the climate change pushing carbon emissions on the back foot therefore coal would not be popular. That really hasn't happened and last of course we had the Fukushima disaster which made also clear the dangers of nuclear plants and not that they cannot be made safe but the cost of making them safe is prohibitive and consequence of not having a safe plant means that you could really open yourself out to huge losses not just for one year or two years but you could also create a condition where saving for instance what we saw in the Fukushima disaster saving that area being able to bottle up the plant and be able to prevent radioactive fuel and waste from leaching into the sea and nearby waterways underground water this is really prohibitively high. So we are really seeing the consequence of the bad economics of nuclear industry bringing it down it's not that nuclear per se is something that we cannot do the nuclear energy is something we cannot do but the cost of doing it against other forms much safer much lower in price today particularly with wind and solar I think nuclear is something that need technology something we need to mouth ball interestingly enough the two other nuclear vendors apart from India who are still active are the Russians and the Chinese and they is because the state supported they also are able to do certain things other players are not able to do because they are supposedly trying to survive commercially. So if we talk about India the left in India opposed the nuclear deal of which Westinghouse was a part so how is this bankruptcy going to effect when it comes to India the nuclear industry? The US Embassy has made a declaration after the bankruptcy of Westinghouse that this is not going to affect the India-US nuclear deal or the Westinghouse reactors in India. I think this is complete mangan. It's very clear that this Westinghouse 6 reactors which was really a part of the India-US nuclear deal it was originally supposed to be built in Mithi, Vidhi in Gujarat then it was shifted to Srikarpulam in Andhra this has been going on for 10 years this discussions it's very clear that this deal is now going to hit the rocks. So I have no doubt that the Westinghouse project is dead and whoever says it is not things are going to continue is really just whistling in the dark this is not going to happen. It also brings out what the left had said left had not only opposed the India-US nuclear deal from the point of view of a strategic alliance which India was trying to seek with the United States and the consequence of that but it also said the nuclear energy particularly with important reactors is not going to be viable. We saw earlier the ARIVA nuclear reactors the costs were going to be something like 28 to 30 crores per megawatt which is at least 6 times that of coal or even today solar plants. So given those kind of costs we had said whether it's ARIVA or whether it's Westinghouse or it's a G reactors that these important reactors have no chance of being successful in India and also their untested reactors and therefore wherever you try to build untested reactors the time and cost calculations go completely awry. If we want to see why Westinghouse is facing bankruptcy primarily because it was trying to build reactors at fixed costs they had taken fixed cost contracts both in Georgia and South Carolina the two places where they're building two reactors each and the fixed price contracts that they had meant that whatever was the increase in cost they had to absorb that. Now the kind of changes required the kind of cost escalation that took place meant that they're facing a loss losses to the amount of something like 10 billion dollars and that's what finally Toshiba could not absorb. Now if India wants to bail out Westinghouse bail out the nuclear industry in the US by taking those losses reaching not fixed price contracts but variable price contracts then it's theoretically possible for Westinghouse to still survive or at least continue the Indian contracts but I think Indian people are not going to be so stupid that they will allow this to happen. It's also clear that the liability laws we had in the country again left had worked very hard in the parliament to get this liability laws which actually puts the responsibility of the of accidents etcetera false equipment on the nuclear supplier nuclear suppliers liability which the United States opposed and the United States companies opposed that is what held up for a long time this contract from taking shape which is what is saving us today. In fact only in 2016 2017 that US and India tried to absorb the liability of the supplier or to the Indian government which is what the Modi government really did but unfortunately for Westinghouse it's come too late. Thank you very much for joining us and this is all the time we have for NewsClick keep watching us.