Further delays at the Daishan EPR project being built in China are hammering another nail in a coffin. The only debate now is whether the coffin will house the Hinkley C project or the whole of EDF. This news coincides with reports that EDF are planning asset sales to fund the Hinkley C project. The Daishan (or Taishan) plant’s construction was begun in 2009 and was supposed to be finished in 2013. Given the calamitous history of EPR constructions 2017 would count as a hopeful rather than likely date for a start-up. Earlie comment about how funding the Hinkley C project would lead to the financial downfall of EDF is now augmented by reports leaked of the sort of assets EDF will have to sell-off in order to fund Hinkley C. It becomes clear that EDF will have to sell-off profitable assets to fund Hinkley C, something that is almost universally regarded as at least a rather large gamble or, increasingly, a probable disaster that will sink EDF. Given that the EPR is proving to be such a turkey in three multibillion projects (Olikuoto, Flamanville and now Daishan) what sort of business decision can it be to fund a fourth project that could break the company? Only a state owned company that controls the (French) state could possibly do such a thing!
Dave Toke’s Blog 6th Jan 2016 read more »
EDF plans to sell more than 6 billion euros of assets in 2016 (to finance Hinkley Point). Sales could include US & UK generation assets and French grid. EDF’s philosophy is to finance new projects by selling existing assets, by reallocating capital so as not to increase the debt (37.5 billion euros in mid-2015) and meeting the commitment to bring more money into the group. But two important projects are on the table in 2016: a final investment decision for the construction project of two EPR at Hinkley Point in Britain (21.7 billion euros). And the takeover of Areva NP (51% to 2.7 billion euros, according to the latest estimate). “It is clear that if EDF decides to go ahead with Hinkley Point C, a substantial divestiture program will be needed. If the decision on Hinkley Point C preceded the development of a plan to streamline the portfolio, the action could react badly, “warned last month, a note from RBC Capital Markets.
Les Echos 6th Jan 2016 read more »
French utility EDF is considering selling assets worth over 6 billion euros ($6.45 billion) this year, French daily Les Echos reported on Wednesday.EDF is notably considering selling stakes in its eight British nuclear plants to fund plans to build two European Pressurised Reactors (EPR) in Hinkley Point, Britain, Les Echos said, without citing its sources.”The company has written over 6 billion euros of divestitures in its 2016 budget,” Les Echos said.EDF declined to comment. The company needs 55 billion euros to upgrade its ageing nuclear plants, plans to invest 18 billion pounds ($26.37 billion) in Hinkley Point and spend several billion euros to buy Areva’s reactor unit.Les Echos said EDF could sell a stake of up to 29 percent in EDF Energy, whose nuclear assets have a book value of nearly 9 billion euros. This would leave EDF with a 51 percent stake, as British utility Centrica owns 20 percent. The paper said a sale had been studied but the process had not been launched.
Reuters 6th Jan 2016 read more »
French electricity giant EDF is considering a partial sale of its eight UK nuclear reactors in order to help fund its £18 billion investment in the Hinkley Point C new nuclear project, according to reports in the French media.
Utility Week 7th Jan 2016 read more »
As the National Audit Office calls Hinkley Point C an ‘unrealistic’, ‘over-optimistic and potentially ‘undeliverable’project, NFLA urges Government to rethink its energy ‘reset’ policy. The Nuclear Free Local Authorities (NFLA) is not surprised to hear the National Audit Office’s (NAO) assessment of the proposed new nuclear power stations at Hinkley Point as potentially‘undeliverable’. NFLA calls for an urgent reassessment by the UK Government of energy policy to take into account these findings. The NAO report considered 106 major infrastructure projects around the UK, and found that 37 of those due to be completed within the next five years have been branded “unachievable” or “in-doubt”. One of these is the Hinkley Point project. It is not known from the report whether the Hinkley Point project has been given a ‘red’ or an ‘amber red’ warning by the Infrastructure and Projects Authority (IPA), which assesses whether EDF, who plan to build the reactors, have the ability to meet cost and timetable targets for the project. NFLA plans to write to the IPA to clarify this matter.
NFLA 6th Jan 2015 read more »