How the SHANTI Act Changes the Way India Thinks About Nuclear Power

The SHANTI Act establishes a robust statutory foundation for an expanded, secure, and bankable nuclear energy sector in India. Rigorous implementation of this framework is poised to position nuclear power as a resilient, low-carbon pillar of the national energy infrastructure.

February 16, 2026. By News Bureau

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articles

Kumar Shashwat Singh Sawno

Kartikay Trivedi

Rishabh Anand Chauhan

SandA Law

SHANTI Act

nuclear-power

Rigorous implementation

Energy Infrastructure

Ambitious pursuit

Sustainable Harnessing

Nuclear Damage Act

Civil Liability Act

Tariff Regulation

India, in its ambitious pursuit of attaining 100 GW of nuclear power capacity by 2047, has taken a decisive step forward with the enactment of the Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India Act, 2025 (“SHANTI Act” / “Act”). The present Act, while overhauling the provisions of the erstwhile Atomic Energy Act, 1962 (“Atomic Energy Act”) and the Civil Liability for Nuclear Damage Act, 2010 (“Civil Liability Act”), addresses the several bottlenecks that have long been long in India’s discourse pertaining to nuclear energy. These issues, such as private participation, liability and structured compensation have been a hurdle in India’s nuclear enhancements. While building up on the previous legislation, the Act enables private companies and joint ventures to own, operate, or decommission nuclear power plants and reactors, under strict rules and regulations while preserving state control over fuel-cycle activities. Subject to transparent implementation and rigorous regulatory oversight, the Act is poised to transition nuclear power generation from a series of ad hoc projects into a sustained national program. Interestingly, the need for reforms in the Atomic Energy Act and Civil Liability Act was previously envisaged by the authors as well. The article written by the authors emphasised the need to amend the Atomic Energy Act and move away from a government-centric model of nuclear energy development, and allow private participation amongst other aspects.

Private Participation and Liability

The most consequential reform, other than opening the market for private participation, is the streamlining of supplier liability within the statute. Under the earlier framework, operators' statutory right of recourse against suppliers for defective equipment and substandard services created indeterminate exposure, thereby deterring private and foreign investments. The new statute narrows that exposure by limiting statutory recourse to contractual rights and intentional acts. The statute though continues to channel primary liability to the operator of the nuclear installation.

Another important reform allows patents to be granted for inventions intended for peaceful uses of nuclear energy and ionising radiation. Under the extant Atomic Energy framework, such patents were effectively prohibited, which dampened any private R&D and limited technology transfer. Patent protection for peaceful nuclear-energy applications would incentivise private- sector innovation while safeguarding national security interests.

Tariff Regulation and Appeals

A reliable and predictable tariff regime, which provides investors assurance of revenue recovery, is essential for securing commitment to long-gestation nuclear projects and facilitating private participation. The Act empowers the Central Government to directly fix the tariff for electricity generated through nuclear power plants through notified norms and mechanisms notwithstanding the Electricity Act, 2003. However, any person aggrieved with the decision of the government may file an application before Council, which can thereafter be challenged before APTEL to determine the tariff. Atomic Minerals, used as nuclear fuel, are only one component of the overall tariff regime. The rate of the Atomic Minerals is determined by the Central Government, as mentioned under Section 9(3) of the Mines and Minerals (Development and Regulation) Act, 1957. The competent regulatory authorities under the Electricity Act may determine ancillary tariff components, including capacity, energy, and O&M charges, and integrate the Central Government’s prescribed rates for atomic minerals to issue a consolidated final tariff order.

International Experience

Various other countries have had success in their nuclear regime post-leveraging private investments to drive their nuclear expansions. In the United Kingdom, Hinkley C and Sizewell C serve as key examples of successful international collaboration. Similarly, the UAE entered into a strategic partnership with South Korea’s KEPCO (Korea Electric Power Corporation), for the financing and construction of the Barakah Nuclear Energy Plant, which currently satisfies 25 percent of the UAE’s total electricity demand. These frameworks illustrate that coherent and stable provisions regarding liability, safety supervision, and revenue generation can expedite project execution by incentivising private-sector engagement.

Operational Roadmap and Implementation Strategy

India has adopted a progressive stance by aligning its nuclear framework with international best practices. Building on the foundation of the Union Budget 2025-26, which allocated INR 20,000 crore for the development of Small Modular Reactors (SMRs), the upcoming Union Budget 2026-27 should attempt to scale through fiscal incentives like the Production Linked Incentive (PLI) scheme for nuclear components. This will help India localise critical manufacturing and cut costs for the first wave of projects under the SHANTI Act. To further integrate nuclear power into the national energy mix, the Central Government has a strategic opportunity to classify nuclear energy as 'green energy' under the Green Energy Open Access Rules, 2022. Designating nuclear power as green energy would enable direct procurement by industrial and commercial consumers via open access mechanisms, thereby bypassing traditional distribution licensees and affirming nuclear energy's credentials as a low-carbon, reliable source.

The SHANTI Act establishes a robust statutory foundation for an expanded, secure, and bankable nuclear energy sector in India. Rigorous implementation of this framework is poised to position nuclear power as a resilient, low-carbon pillar of the national energy infrastructure, facilitating the realisation of India’s target of 100 GW of nuclear capacity by 2047. While concerns regarding security and public safety following incidents such as Chernobyl and Fukushima are valid, plant ownership is not the determinative factor in nuclear safety and security. Rather, the governance and management of operations are paramount. Ensuring safety is predicated upon stringent regulatory supervision by competent authorities and consistent maintenance protocols.

- Kumar Shashwat Singh Sawno (Senior Principal Associate), Kartikay Trivedi (Senior Associate) & Rishabh Anand Chauhan (Senior Associate) at S&A Law Offices