India’s electricity demand has surged significantly with its growing economy. As the third-largest electricity producer, the country still heavily relies on conventional sources like coal, which contribute to carbon emissions, raising concerns about climate change and global warming. To address this, the Indian government has set a target of achieving net-zero emissions by 2070, positioning nuclear power as a key alternative energy source.
Let’s break down the current state of nuclear energy in India, the challenges it faces, the government’s focus on the sector, and the potential benefits for investors.
Current State of Nuclear Power Energy
India is the third-largest producer and consumer of electricity worldwide, with a total installed power capacity of 466 GW as of January 2025. The total power generation from various sources stood at 1,519 BU, with thermal power (coal-based) contributing the majority share of 72.57% or 1,102.02 BU.
As of January 2025, India’s nuclear power installed capacity stands at 8.18 GW, following a 1.4 GW addition in 2023-24. According to the data, nuclear energy contributes only 3.15% (47.77 BU) to total power generation, highlighting a significant opportunity to expand nuclear capacity and generation.
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Out of the total 1,519 BU of power generation, nuclear energy currently contributes approximately 3.15% or 47.77 BU.
Additionally, India’s nuclear power generation capacity has grown from 5.78 GW in 2015-16 to 8.18 GW in 2024-25. However, it remains a minor contributor, accounting for just 1.75% of the country’s total installed capacity of 466 GW.
Coal continues to dominate as India’s primary power source, while nuclear energy holds a minimal share.
Nuclear Power Plants in India
India currently operates 24 nuclear reactors with a combined installed capacity of 8.18 GW, contributing approximately 1.8% of the country’s total electricity capacity. Additionally, nine atomic power projects are under construction, with several others in the pre-project stage, according to Union Minister Jitendra Singh.
Besides the 24 operational plants, nine projects are under construction, aiming to help achieve the 100 GW target by 2047.
Furthermore, India’s nuclear power generation capacity is projected to reach 22.48 GW by 2031-32 and ultimately 100 GW by 2047. To support this growth, the government recently launched the National Nuclear Energy Mission in the 2025 Budget.
Nuclear Energy Mission
In Union Budget 2025, the government introduced the Nuclear Energy Mission, allocating Rs 20,000 crore to develop five indigenously designed Small Modular Reactors (SMRs) by 2033 and achieve 100 GW nuclear capacity by 2047. This initiative aims to enhance energy security, reduce fossil fuel dependence, and support climate commitments.
To accelerate this, the government is actively involving the private sector in three key areas:
Establishing Bharat Small Reactors to integrate nuclear power into India’s energy mix.
Research & development of Bharat Small Modular Reactors, focusing on scalability and cost-effectiveness.
Exploring new nuclear technologies to enhance efficiency and sustainability.
However, achieving this target poses a significant challenge, requiring an addition of 91.82 GW to the current 8.18 GW over the next 22 years.
Challenges of Nuclear Energy
High Initial Costs: Setting up a nuclear power plant to meet the 100 GW target by 2047 demands massive investments. Additionally, it takes years for these plants to become operational.
Expensive Operations: Beyond the substantial initial investment, daily operations of nuclear plants are costly.
Limited Uranium Supply: India lacks sufficient uranium reserves and depends on imports, affecting the long-term stability of its nuclear energy program.
Limited Private Participation: Although the government intends to amend various acts to allow private investment, concerns about liability and profitability remain.
Public Opposition: Large-scale nuclear projects often face protests, as seen in the Kudankulam protests in Tamil Nadu, due to concerns about radiation exposure and environmental impact.
Government Initiatives
Construction & Commissioning of Reactors: The government plans to construct 10 reactors (8,000 MW) across six states — Gujarat, Rajasthan, Tamil Nadu, Haryana, Karnataka, and Madhya Pradesh. Another 10 reactors are in the pre-project stage, set for completion by 2031-32.
International Collaboration: The government has given in-principle approval for a 6×1,208 MW nuclear power plant in collaboration with the USA at Kovvada, Andhra Pradesh.
Private Sector Participation: The government plans to amend the Atomic Energy Act, Civil Liability for Nuclear Damage Act, and Electricity Act to enable private participation in nuclear projects.
ASHVINI Project: A joint venture between Nuclear Power Corporation of India Limited (NPCIL) and NTPC Limited to develop nuclear power plants, including the 4×700 MWe PHWR Mahi-Banswara project in Rajasthan.
Budget Allocation: The Department of Atomic Energy’s budget has increased from Rs 10,446.59 crore in 2014-15 to Rs 24,968.98 crore in 2024-25.
Project BHAVANI: With 21% of the world’s thorium reserves, India is developing Project BHAVANI to utilise thorium for nuclear energy and reduce reliance on imported uranium.
Stocks to Add to Your Watchlist
The following companies may directly or indirectly benefit from the growth of nuclear energy as a power source in India:
These stocks could gain from the increasing role of nuclear power in India’s energy sector.
What’s Next?
In February 2025, India’s power consumption reached 131.54 BU, up from 127.34 BU in the same month last year, according to government data. Additionally, estimates predict that peak power demand could hit 270 GW in the summer of 2025.
India’s per capita electricity consumption rose to 1,395 kWh in 2023-24, reflecting a 45.8% increase (438 kWh) from 957 kWh in 2013-14. Given the escalating demand for electricity, relying solely on conventional energy sources is unsustainable.
Achieving 100 GW nuclear capacity by 2047 will require an investment of approximately Rs 14.7 lakh crore, as reported by Energy World in The Economic Times. If successful, this expansion will not only reduce dependence on traditional energy sources but also lower carbon emissions, aligning with India’s Net Zero Emissions goal by 2070.
*The companies mentioned in the article are for information purposes only. This is not an investment advice.
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