The Union Budget 2025-26 has outlined major energy sector reforms, with a focus on expanding nuclear energy capacity and improving electricity distribution and transmission infrastructure across the country.
Key legislative changes will include amendments to the Atomic Energy Act and the Civil Liability for Nuclear Damage Act to support the goal of developing at least 100 GW of nuclear energy by 2047. A Nuclear Energy Mission will be established for the research and development of Small Modular Reactors (SMRs), with a proposed outlay of ₹20,000 crore. As part of this initiative, at least five indigenously developed SMRs are expected to become operational by 2033.
In addition to nuclear energy, the government will introduce incentives for electricity distribution reforms and the augmentation of intra-state transmission capacity by state governments. To encourage the adoption of these reforms, the budget permits additional borrowing of 0.5% of GSDP by states, contingent upon their progress in implementing the proposed changes.
These reforms are aimed at enhancing the efficiency, reliability, and sustainability of India’s energy sector while reducing dependence on non-renewable sources.
