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The Economic Survey 2025-26 tabled in the Parliament on Thursday significantly broadens the role envisaged for nuclear energy in India’s energy transition, positioning it not merely as a source of firm electricity but as a critical enabler for green hydrogen production and decarbonisation of hard-to-abate industrial sectors.
A key emphasis in the Survey is nuclear power’s potential role in green hydrogen production, particularly for applications where round-the-clock power availability is essential.
The Survey explicitly notes that nuclear energy can be used to produce hydrogen for transport and industrial processes, positioning it as a complementary pillar to renewable-based hydrogen pathways under the National Green Hydrogen Mission.
“It (nuclear energy) can be used to produce hydrogen to power vehicles, and industrial processes,” noted the Survey.
Unlike solar- or wind-based electrolysis, which depends on storage and grid balancing solutions, nuclear-powered electrolysers can operate at high capacity utilisation rates, improving efficiency and reducing system-level costs.
Hard-to-abate sectors as beneficiaries
Beyond hydrogen, the Survey highlights nuclear energy’s relevance for hard-to-abate sectors such as steel, cement, fertilisers, chemicals and other heavy industries, which face technological limitations in switching entirely to variable renewable power.
“Nuclear energy can provide a reliable energy source for heavy industries that find it difficult to use renewable sources due to technological challenges,” the Survey stated.
It argues that these sectors require stable and predictable energy inputs that renewables, without large-scale storage, cannot consistently provide. Nuclear power, the Survey states, can offer a reliable low-carbon energy source for such industries, enabling deep decarbonisation without compromising industrial productivity or energy security.
This is particularly important, the Survey notes, as countries that have retired firm power sources too rapidly have faced rising industrial electricity prices and grid stress — a risk India is keen to avoid as it scales manufacturing under initiatives such as Make in India and export-oriented industrialisation.
Small modular reactors widen industrial use cases
The Survey also links nuclear’s expanded role to the development of Small Modular Reactors (SMRs), including the proposed 200 MWe Bharat Small Modular Reactor and smaller 55 MWe designs.
These reactors are seen as better suited for industrial clusters, hydrogen hubs and remote manufacturing locations, where flexible deployment and co-location with industrial demand can lower transmission losses and improve energy efficiency .
By enabling decentralised and scalable nuclear capacity, SMRs could support hydrogen production and industrial decarbonisation in ways that large, grid-connected reactors cannot easily replicate.
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