What if EDF says no to Hinkley Point? What if the French power generator, under pressure from its unions and potential lenders, decides it can’t finance the £18bn project, even with the Chinese chipping in? After all, the disgruntled French workers make a reasonable point. EDF’s last big foreign adventure, in Finland, is nine years behind schedule and massively over-budget, so why risk another expedition? EDF’s share price, remember, is down 85% since 2004: the company is in a weak position to resist its local critics. The short answer is that the UK’s nuclear strategy would be in tatters if EDF backs out. If EDF can’t get financing for Hinkley, then Sizewell C, the company’s intended follow-on project in Suffolk, would also bite the dust. The same goes for the next plant at Bradwell in Essex, where Chinese constructors are supposed to be taking the lead but are relying on Hinkley’s and Sizewell’s infrastructure and momentum. And, if the UK’s nuclear strategy becomes a non-runner, then the government’s entire energy policy is dead. By the mid-2030s, Hinkley and other new nuclear plants are supposed to have replaced the current clapped-out fleet and added capacity on top. EDF is still at the table and the French government, when push comes to shove, tends to be supportive. The best guess – still – is that the funds will be forthcoming. If not, Osborne’s difficulty with Google’s tax bill would look like a storm in a tea cup. All the subsidies, and the grovelling for Chinese cash, would have yielded nothing except proof of the horrible economics of nuclear power in the 21st century.
Guardian 27th Jan 2016 read more »
EDF, the French utility which a couple of years ago seemed to promise Chancellor George Osborne it would build Britain’s first new nuclear power station for more than 30 years, at Hinkley Point in Somerset. Many suspect the commitment was a moment of madness the French board now regrets and wants to get out of. Certainly it is under pressure to change its mind. News came this week that France’s CFE-CGC energy trade union, which is represented on the board, has grave doubts about whether EDF can afford the contract. Infrastructure UK, now under the wing of the Treasury, has given the project a credit rating of BB plus, which is below investment grade. That almost suggests it believes the project won’t happen — or at least that it will not be completed on time or on budget. There are reasons to be sceptical. EDF has said it will have the plant completed and running by 2025, which gives it just nine years to build the twin reactors. But its two previous attempts to build this kind of reactor have been troubled.
Evening Standard 27th Jan 2016 read more »
EDF has agreed a significant investment in the troubled reactor business of Areva, putting further pressure on the French utility as it scrambles to secure financing for a contentious £18bn nuclear project in the UK. The board of the French utility on Wednesday night approved taking a controlling stake in Areva NP, valuing the reactor unit at about 2.5bn euros. Areva also separately announced a 5bn euros capital increase that would be backed by the French state. The move by EDF, which was at the behest of the state, will increase the financial burden on the company at a time when some analysts and trade unions are worrying that it may be biting off more than it can chew. Concern rests primarily around EDF’s plans to build the first new nuclear power plant in the UK for a generation at Hinkley Point in Somerset – a project that presents a signif icant construction risk for the group. The EDF board held back from giving final approval for the Hinkley project on Wednesday, with people close to the company saying that it had not managed to line up the financing.
FT 28th Jan 2016 read more »
The latest postponement of the Hinkley Point nuclear reactor project is the most serious delay of many because it shows that the plan is fundamentally uneconomic for the owners as well as for consumers. Readers may recall being told at the time of the visit of Xi Jinping, the Chinese premier, in October that the Hinkley deal was done. Everything was ready to go. Unfortunately, this was the worst sort of PR spin. The Chinese have not formally signed up to the financing agreement and now it has become clear that the EDF board is unwilling to go ahead with a decision that would add to its financial problems by adding debt and risk to its already shaky balance sheet. EDF shares have more than halved in the past year. The merger with Areva forced on EDF by the French government also adds to the company’s burden because of the unfinished and perhaps unfinishable reactor construction project at Olkiluoto in Finland. At Flamanville in northern France another EPR reactor sits uncompleted and adding costs but no revenue. There is no prospect of the French government, its main shareholder, rescuing EDF. Thousands of employees are being laid off, alienating the French trade unions who have come out against Hinkley because of its potential negative impact on the company’s finances. It is not clear that the French government, which is ambivalent about nuclear, is about to offer the extra support requested for Hinkley. Why should French taxpayers subsidise UK consumers? The EDF board’s postponement of its final investment decision is correct, though it might be better if they said definitively that they will not proceed until Flamanville and Olkiluoto are up and running, even if that takes another five years. What does t his mean for UK energy policy? Britain has two choices. The first is to fund the project. The second alternative is to rewrite existing energy policy: substituting gas for nuclear and perhaps extending the life of coal-fired stations beyond 2025. Extra offshore wind, short of a big technical breakthrough, would surely be too expensive to meet the government’s objective of reducing electricity costs.
FT 27th Jan 2016 read more »
Is Britain’s first new nuclear plant in decades about to fall at the final hurdle? Escalating costs, slipped deadlines, and an ever shifting cast of players have seen Hinkley point C – which is expected to one-day provide 7 per cent of the UK’s electricity – mutate from a £16bn plant due to open in 2017 to an £18bn facility due to begin operating in 2025. Clouds of doubt are once again gathering over the project. It seems unthinkable that EDF will pull out of Hinkley Point C – particularly as it has already ploughed £2bn into the facility. And with the company yet to publicly comment on today’s reports it’s conceivable that these last minute jitters will be quickly laid to rest. However, some are convinced that some dark days lie ahead. Indeed, in a report on the BBC website, Greenpeace director John Sauven claims that the delay could “signal curtains” for the project. If the reports are true, it seems we’ll have to wait until February 16th at the earliest – when EDF publishes its annual results – to see exactly what the future holds. And whilst another delay wouldn’t be disastrous, it would take a brave gambler to bet against that far off target of 2025 slipping once again.
The Engineer 27th Jan 2016 read more »
French energy giant EDF today moved to deflect claims that the new Hinkley Point nuclear station in Somerset could be delayed. A company spokeswoman said claims that a board decision on whether to go ahead had been postponed were “all speculation”. The French paper Les Echos and environmental group Greenpeace said EDF’s board was expected to meet today Wednesday to finalise the decision on Hinkley, but the decision had now been delayed due to funding difficulties. The EDF spokeswoman said: “There was no date set for making the final decision. It was all speculation. “We have recently had planning permission for the overhead power line for the station and the project is very much moving ahead.” Any delay at Hinkley would fuel fears that Britain is headed for an “energy gap”, where demand exceeds supply. But Somerset-based Green energy company British Solar Renewables said solar and wind power could step in to fill Britain’s energy gap. Angus Macdonald, its chief executive, said: “Although we are in support of ending old thinking by scrapping coal generation, in doing so we are yet to see a clear plan of how the Government see the UK meeting its energy gap. “BSR and other companies in our industry are ready to step up to the mark to support the UK to develop its renewables energy mix and increase our world leading status in renewable technology. “As renewable technology is becoming more efficient, solar, wind and energy storage can help to make up the gap and provide a new base load power network within the next decade.
Western Morning News 27th Jan 2016 read more »
The decision to invest in Britain’s first new nuclear plant in decades has been put off due to funding difficulties, according to French paper Les Echos and environmental group Greenpeace.
Central Somerset Gazette 27th Jan 2016 read more »
The Nuclear Free Local Authorities (NFLA) welcomes today’s reports that EDF has postponed a final investment decision to go forward with new nuclear reactors at Hinkley Point. It sees it as a sensible decision that could allow for an equally sensible review of UK energy policy. NFLA is looking forward to bringing some of the issues around nuclear power to MPs at a major joint seminar in Westminster tomorrow, with its keynote speaker the former Japanese Prime Minister Naoto Kan.
NFLA 27th Jan 2016 read more »
EDF has delayed a final decision to approve what would be the UK’s first nuclear power plant in decades, according to media reports. The final decision on whether to build two nuclear reactors at Hinkley Point in Somerset was expected to be made at a board meeting on Wednesday. However, French paper Les Echos and environmental group Greenpeace said the decision has now been delayed. The item was taken off the agenda due to last-minute concerns expressed by some of the firm’s key backers, sources told the Financial Times.
Business Green 27th Jan 2016 read more »
James Heapey MP said: “News that EDF have kicked the Hinkley can down the road again is unwelcome and is understandably causing concern for local businesses and residents. I understand that EDF are now to make the Final Investment Decision in mid-February to coincide with the publication of their annual results. Ministers remain confident that all is as it should be and EDF, whilst tight lipped are not giving me any cause for concern either. However if the FID is further delayed beyond the publication of EDF’s results, I think we’d be right to start worrying that things are going awry. Clearly EDF is under significant financial pressure caused by the collapse in the wholesale price of electricity, their market value has fallen steeply leading to them dropping out of the CAC-40, the French unions are agitating over potential job losses in France and the French Government – who have a big say in what EDF does – will be sensitive to that sort of thing with Presidential elections just over a year away. “That said, it is reported that EDF have already sunk £1 billion into the Hinkley site and that is sort of investment that you do not walk away from. I remain, therefore, confident that all is moving forward but if the FID is not announced by the time Parliament returns from recess on 22nd February, I will be seeking to ask some urgent questions of EDF and the Government.”
Shepton Mallet Journal 27th Jan 2016 read more »
MEP for the South West, Molly Scott Cato, has said EDF faces meltdown if the company proceeds with building two new nuclear reactors at Hinkley Point in Somerset. The board of directors of the company, in which the French government has an 85% stake, were due to reach a final decision on financing the project this week. However, it now looks almost certain that a final decision on funding Hinkley C will again be deferred. This further delay comes amid reports of dissent amongst both the EDF board and employees. One of the unions representing EDF employees, and which has seats on the management board, has challenged the scheme, saying there is little benefit to French industry, no evidence it can be built on time and questioning how it will be paid for, given EDF is seriously strapped for cash – the company has seen its share price plummet by at least 50% over the past 12 months. The Union also raises concerns over pending legal cases being brought by the Austrian and Luxembourg governments and by a consortium of European renewable energy generators over whether loan guarantees constitute illegal state support.
Molly Scott Cato 26th Jan 2016 read more »
The Government’s policy of burdening bill payers with eye watering subsidies for new nuclear power has received another blow. Just before a crucial board meeting at EDF (the French state owned energy giant relied on by the Government to invest in and operate Hinkley Point) French trade unions spoke out about their concerns. When even staff working for EDF are raising serious doubts about numerous aspects of the proposal, UK Ministers’ cavalier attitude to Hinkley Point C needs to change, more urgently than ever.
Caroline Lucas 27th Jan 2016 read more »
Nuclear plant would be most expensive ever.
Sky News 27th Jan 2016 read more »
Plans for a new nuclear plant at Hinkley Point have “descended into farce”, the SNP has claimed, amid reports EDF has delayed its decision on whether to proceed with the project due to funding problems. While EDF refused to comment, French news reports suggest the firm was struggling to generate funding to supply its 66.5 per cent stake in the project, leading it to lobby the French government for additional capital. Although EDF chief executive Jean-Bernard Levy last week claimed the two new reactors would be built soon, the SNP has now called on the UK Government to rethink its plans.
Holyrood 27th Jan 2016 read more »
EDF has again delayed making a final investment decision for the construction of the Hinkley Point C nuclear power plant in the UK. A decision had been expected by the end of 2015. The French utility’s board had been due to meet today to finalise the decision on constructing the two EPR units at Hinkley Point C. However, media reports say the decision to go ahead with the project was taken off the agenda. They suggest a final investment decision could now be announced on 16 February at the earliest, when EDF is scheduled to report its annual results. EDF itself has made no comment on the reported delay.
World Nuclear News 27th Jan 2016 read more »