Kudankulam Power Plant Project Cited For "Deficiencies"

Indian auditors have issued a report specifying a laundry list of cost-escalations caused by on-going construction delays and missed time-line expectations at the Kudankulum nuclear power plant, but also naming Rosatom export division Atomstroyexport as responsible for many of the delays.

Kudankulam NPPThe Comptroller and Auditor General of India (CAG) issued the report on Dec. 27, according to the World Nuclear Association (WNA). CAG is a budget-oriented regulator designed to assure a variety of stakeholders, including the general public, that public funds are spent according to their levied purpose.

The agency named several project-specific deficiencies related to Kudankulam Units 1 and 2, which were commissioned in December 2014 and January 2017, respectively. Construction delays, however, put Units 1 and 2 at 86 months and 101 months behind schedule, respectively, almost doubling the initial $3 billion price tag for the construction phase of the reactors.

The plant owner and operator, National Power Corporation of India (NPCIL) was forced to borrow funds above and beyond the original budget and to begin paying back Russian lenders prior to the start of plant operations. As a result, rising cost for the project snowballed.

According the the WNA report cost jumped due to “avoidable payment of interest on borrowings; non-transparency in availing loans; lapses in the tariff fixation process; extending undue benefits to the overseas collaborating partner; non-assessment of required manpower and consequent avoidable expenditure; inadequate monitoring; and start of commercial operation before receiving the required license to operate from the competent authority.”

Unit 1 at the plant went into commercial status on 31 December 2014, six months prior to the license for operations was issued by the Atomic Energy Regulatory Board.

The facility is to be home of two additional phases of construction. Phase II, consisting of two more Russian-built VVER-1000 reactors began with initial concrete pouring over the summer. Kudankulam Units 5 and 6 are also planned.

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