The Russian-built Kudankulam plant has been dogged by opposition for 25 years and last year witnessed violent protests by villagers, who said the plant was a threat to their safety.
The start of production at the plant comes in the same week as the Indian prime minister, Manmohan Singh, visited Russia. Indian media have reported that legal wrangles have prevented an agreement on new reactors being set up at the site.
Unable to rely on a coal sector crippled by supply shortages and mired in scandals, India is pushing ahead with constructing nuclear reactors despite global jitters over safety.
Hundreds of millions of Indians still live without power and factories suffer frequent blackout – an embarrassment to India’s aspirations as an emerging economic powerhouse.
Work on powering up the reactor at the Kudankulam plant gathered pace after the Supreme Court in May dismissed petitions challenging the project. A second reactor, also with a capacity of 1,000 megawatts will likely be brought into service by June 2014, said an official with the company, who declined to be identified by name.
India plans to raise its nuclear power capacity to 63,000 megawatts over the next 20 years, from 4,700 megawatts now.
The last time it commissioned a nuclear reactor was in January 2011.
India is also trying to increase output of wind, solar energy and biofuels as it seeks to diversify from coal- and gas-based power generation.
Indian and Russian officials have been in talks for the supply of equipment for the third and fourth reactor and have drafted the broad outlines of an agreement, according to Indian government officials.
But the two sides stopped short of signing a widely expected deal during Mr Singh’s visit to Moscow this week because of Russia’s concerns about an Indian law that fixes compensation liability on an equipment supplier in the event of an accident.
“We expect to sign this shortly. It will probably be on similar lines to the one we have for the first two reactors at Kudankulam, with some changes in clauses,” said a Nuclear Power Corporation executive.
The law that makes suppliers of nuclear power equipment to India liable in case of an accident applies only if there are manufacturing defects, but equipment companies wanting to sell to India have still been jittery about the legal clause as the standard practice is to hold plant operators liable.
Despite reservations, negotiations with global nuclear equipment suppliers now seem to be advancing.
Nuclear Power Corporation signed a preliminary contract with US-based Westinghouse Electric Company late last month to purchase nuclear reactors, which covers preliminary regulatory and site-development work for a planned complex in Gujarat state.
The state-run Indian company is also in advanced talks with a French company for purchase of equipment for a power project in the state of Maharashtra, said a senior government official who works at the Department of Atomic Energy.
But some say that nuclear power will not substantially cut down a gap in energy demand and supply.
“Nuclear power has its own set of problems. The problem of social acceptability is a major challenge besides that of land and capital,” said Lydia Powell, Senior Fellow at Observer Research Foundation, a private think tank.
“It can’t solve the problem of your main fuel source that is coal. Local coal is the only solution and not nuclear,” she said, referring to India’s huge coal reserves.
* Reuters with additional reporting by Dow Jones
