EDF’s financial problems delay decision on proposed new nuclear plant at Hinkley Point

EDF Energy delays Hinkley Point nuclear decision French power firm’s plans to build first British atomic reactors in almost 30 years suffers further setback Guardian, Terry Macalister, 13 feb 15 The timetable surrounding the construction of Britain’s first new atomic reactors in almost 30 years has once again been blown off course, its developer, EDF Energy, has admitted. The setback came as the French-owned generator and supply company reported a 25% slump in operating profits for 2014 to £863m, which it blamed on challenging market conditions.

EDF had originally promised to tie up a new deal with financial backers and then take a final investment decision on the proposed new plant at Hinkley Point in Somerset by the middle of last year. This date was later revised to March 2015.

But in a new statement, the largely state-owned energy group said a final investment decision might only be possible in a matter of months, and it had still not finalised talks with Chinese financial backers……….

Meanwhile, there is growing speculation that Chinese investors are hardening the terms under which they would be willing to help underwrite some of the cost of the new plant. China National Nuclear Corporation and China General Nuclear Power Corporation are expected to be minority shareholders in the project, but are also pushing for commitments to build and operate their own plant at Bradwell in Essex.

EDF has declined to confirm that it too is trying to limit the financial damage through compensation from the UK government should there be a successful legal challenge in the European courts by Austria to the UK subsidy arrangement.

Critics of the £24.5bn nuclear programme in Somerset have highlighted the industry’s poor track record for constructing facilities on time and on budget. They have questioned whether Hinkley Point C reactors would able to meet their timetable of opening for operations in 2023.

EDF has already run into problems with a new project at Flamanville in Normandy, while another project in Finland, the European pressurised reactor, which uses the same design as Hinkley, is also massively behind its original timetable.

Financial problems at its French design partner, Areva, have not helped the sense of uncertainty surrounding EDF’s nuclear ambitions,……http://www.theguardian.com/business/2015/feb/12/edf-energy-delays-hinkley-point-nuclear-decision

February 13, 2015 - Posted by Christina MacPherson | business and costs, France, UK