French taxpayers face huge nuclear bill as EDF financial crisis deepens, Ecologist, Paul Brown 8th December 2016
Nuclear giant EDF could be heading towards bankruptcy, writes Paul Brown, as it faces a perfect storm of under-estimated costs for decommissioning, waste disposal and Hinkley C. Meanwhile income from power sales is lagging behind costs, and 17 of its reactors are off-line for safety tests. Yet French and UK governments are turning a blind eye to the looming financial crisis.
Bankruptcy for EDF seems inevitable – and if such a vast empire in any other line of business seemed to be in such serious financial trouble, there would be near-panic in the workforce and in governments at the subsequent political fall-out.
But it seems that the nuclear-dominated EDF group is considered too big to be allowed to fail. So, to keep the lights on in western Europe, the company will have to be bailed out by the taxpayers of France and the UK.
The French government, facing elections next spring, and the British, struggling with the implications of the Brexit vote to leave the European Union, are currently turning a blind eye to the report by AlphaValue that EDF has badly under-reported its potential liabilities.
Ageing nuclear reactors
While EDF is threatening to sue people who say it is technically bankrupt, the evidence is that the cost of producing electricity from its ageing nuclear reactors is greater than the market price.
Coupled with the impossibility of EDF paying the full decommissioning costs of its reactors, it is inevitable that it is the taxpayers in France and the UK who will eventually pick up the bill. However this will not be easy due to the EU’s ‘state aid’ rules, which limit governments’ ability to support ailing companies.
There is also the ongoing thorny problem of disposing of the nuclear waste and spent fuel rods, which are building up in cooling ponds and stores on both sides of the Channel, with no disposal route yet in sight.
A looming problem for EDF, which already admits is has €37 billion of debt, is that 17 of its ageing fleet of nuclear reactors, which provide 70% of France’s electricity, are being retired.
According to AlphaValue, EDF has underestimated the liabilities for decommissioning these reactors by €20 billion. Another €33.5 billion should be added to cost of handling nuclear waste, the report says. Juan Camilo Rodriguez, an equity analyst who is the author of the report, says that a correct adjustment of nuclear provisions would lead to the technical bankruptcy of the company.
In a statement, EDF said it “strongly contests the alleged accounting and financial analyses by the firm AlphaValue carried out at the request of Greenpeace and relating to the situation of EDF”.
It says that its accounts are audited and certified by its statutory auditors, and that the dismantling costs of EDF’s existing nuclear power fleet have also been subject to an audit mandated by the French Ministry of the Environment, Energy and the Sea.
Even with its huge debts, EDF’s problems could be surmounted if the company was making big profits on its electricity sales, but the cost of producing power from its nuclear fleet is frequently greater than the wholesale price.
That creates a second problem – that unless the wholesale price of electricity rises and stays high, the company will make a loss on every kilowatt of electricity it sells. The new rightwing French presidential candidate, François Fillon, promises not to retire French reactors and to keep them going for 60 years. But this cannot be done without more cost.
This is the third problem: vast sums of capital are needed to refurbish EDF’s old nuclear fleet for safety reasons following the 2011 Fukushima nuclear disaster in Japan. …….
Repeated life extensions
Since the sale of UK nuclear plants to EDF in 2008 at a cost £12.5 billion, the company has continued to operate them, and has repeatedly got life extensions to keep them running.
But this cannot go on forever, and they are expected to start closing in the next ten years. Once this happens, the asset value of each station would become a liability, and EDF’s mountain of debt would get bigger.
So far, the French and UK governments, and the company itself, seem to be in denial about this situation. Currently 17 French reactors are shut down for safety checks, following the discovery of faulty safety-critical compenents including large, difficult to replace steel forgings like steam generators.
The company has issued reassuring statements that they will be back to full power after Christmas, however in so doing EDF is assuming that the safety checks will give the reactors a clean bill of health. In fact, there are three other possible outcomes:
- additional potentially time-consuming tests are needed that will create further months of downtime.
- remedial engineering works are required to make the reactors safe. These would probably be costly and time-consuming.
- key components at the heart of the reactors, for example steam generators, need to be replaced altogether. However this would be so costly that, for a nuclear plant already reaching the end of its lifetime, premature closure would be the only viable option.
Perhaps the most likely outcome is that some of the 17 reactors will fall into each of these four categories, creating as yet unquantifiable unbudgeted costs for the company.
Meanwhile, to make up the shortfall from the closed reactors, electricity is being bought from neighbouring countries, including the UK, to keep the lights on in France. The power shortage is temporarily causing an increase in wholesale prices – but one that EDF is unable to fully exploit because so many of its reactors are not generating.
The future remains unpredictable – but as long as there are no actual power cuts, no action is expected from governments. Despite official denials, however, the calculations of many outside the industry suggest that it is only a matter of time before disaster strikes.
The cost of producing electricity from renewables is still falling, while nuclear gets ever more expensive, and massive liabilities loom. Ultimately, the bill will have to be passed on to the taxpayers. http://www.theecologist.org/News/news_analysis/2988433/french_taxpayers_face_huge_nuclear_bill_as_edf_financial_crisis_deepens.html
French taxpayers face huge nuclear bill as EDF financial crisis deepens, Ecologist, Paul Brown 8th December 2016 “………New nuclear stations Even more money is required to finish new nuclear stations EDF is already committed to building. The first, Flamanville in northern France, is five years late and billions over budget. Questions over the quality of the steel in its reactor are still not resolved, and it may never be fully operational.
Add to that the need for €12 billion (or potentially considerably more) capital to complete the two nuclear stations EDF is committed to building at Hinkley Point in southwest England, and it is hard to see where all the money will come from.
To help the cash-strapped company, its ultimate owner, the French state, has already provided €3 billion in extra capital this year, and decided to forego its shareholder dividend. But that is a drop in the ocean.
Mycle Schneider, a Paris-based independent international consultant on energy and nuclear policy, says: “The French company overvalues its nuclear assets, and underestimates how much it will cost to decommission them.
“However, EDF’s biggest problem is the cost of producing power from these ageing power stations. The cost is greater than the wholesale price, so everything they sell is at a loss. It is impossible to see how they can ever make a profit.”
He says that is not the company’s only problem: France has not dealt with the problem of nuclear waste, and has badly underestimated the cost of doing so: “With German electricity prices going down and production increasing in order to export cheap electricity to France, it is impossible to see how EDF can ever compete. It is really staggering that no one is paying any attention to this.”
Even former EDF director Gérard Magnin agrees. He resigned from the board in July as he thought the Hinkley Point project too risky for the company because of its already stretched finances. Now he says that, with the reactors closed for safety checks, the French nuclear industry faces “its worst situation ever”.
The company’s troubles do not stop in France, as EDF also owns the UK nuclear industry. Ironically, it took over 15 reactors in the UK after British Energy went bankrupt in 2002 because the cost of producing the electricity was greater than the wholesale price – exactly the situation being repeated now in France.http://www.theecologist.org/News/news_analysis/2988433/french_taxpayers_face_huge_nuclear_bill_as_edf_financial_crisis_deepens.html
Suspected falsifying of documents: French prosecutors investigate Areva’s Le Creusot nuclear foundry
French court probes forged documents case at Areva nuclear foundry http://www.reuters.com/article/us-france-nuclear-areva-court-idUSKBN13X20C, 8 Dec 16 The Paris prosecutor’s office has opened an investigation into the suspected falsifying of documents at Areva’s Le Creusot foundry that manufactures parts for nuclear reactors, a judicial source said on Thursday.
The case, which alleges forgery, use of forged documents, endangerment of lives and aggravated deception, will be put in the hands of the police, the source said. French nuclear safety regulator ASN said in October that it had asked the courts to step in to investigate after nuclear group Areva sounded the alarm in May over documentation irregularities involving 6,000 nuclear component manufacturing files.
Thousands of such documents used in the French nuclear sector dating back to 1965 are being looked at
“We have not been informed (of the investigation) at this point,” a spokeswoman for Areva told Reuters, adding that the group would cooperate with the investigation and hand over all information at its disposal.
The discovery of weak spots in the reactor vessel of the EPR reactor under construction in Flamanville in 2014 led Areva to review manufacturing procedures at its Creusot steel forging plant.
ASN said in September that Areva had identified 87 irregularities related to reactors operated by state utility EDF, 20 concerning equipment for the Flamanville reactor, and one related to a steam generator for EDF’s 900 MW Gravelines 5 reactor on halt since April.
Mitsubishi Heavy faces tough decisions in nuclear power business Orders dry up at home and abroad after Fukushima disaster, Nikkei Asian Review, 8 Dec 16, TOKYO –– Mitsubishi Heavy Industries and Japan Nuclear Fuel are putting the final touches on a plan to acquire a roughly 10% stake in the troubled French nuclear energy company Areva. But for Mitsubishi Heavy it is an agonizing decision.
Facing dim prospects for new domestic orders, both Mitsubishi Heavy and Japan Nuclear Fuel must find other ways to secure enough business to keep their equipment and workforces active.
Back in 2006, Mitsubishi Heavy partnered with Areva to develop a so-called Generation III+ pressurized-water reactor with state-of-the-art technologies. The team has been using the design to compete with the larger, older-generation pressurized-water systems promoted by two other groups: the team of Hitachi and General Electric, and the team of Toshiba and Westinghouse…….
The French government, which owns nearly 90% of Areva, is looking to cut its losses. Unprofitable businesses are being excised from Areva and a new company is being set up that will seek over 30% of its capital from Japan, China, and elsewhere. …
There are lingering worries inside Mitsubishi Heavy about this huge investment in Areva. To alleviate those concerns, Mitsubishi Heavy has voiced confidence that there will be another nuclear renaissance in 20 to 30 years……http://asia.nikkei.com/Business/Deals/Mitsubishi-Heavy-faces-tough-decisions-in-nuclear-power-business
The investigation was launched by the Paris Prosecutor’s office, AFP reported on Monday evening, citing judicial sources.
The Fessenheim power plant is in the Haut-Rhin department in Alsace, eastern France, near the German and Swiss borders.
The plant’s activity is endangering the lives of people and it has equipment which doesn’t fulfill the requirements of safety, according to the AFP report.
All these concerns were previously voiced by Greenpeace, which accused AREVA, a group specializing in nuclear power and renewable energy, and Électricité de France (EDF) of inaction.
In October this year, Greenpeace called upon the Paris prosecutor to investigate the abnormalities of both reactors of the plant.
“EDF and AREVA were aware of serious irregularities on Reactor 2 at Fessenheim,” the statement said. “The defective part is a steam generator, an essential component of nuclear reactors.”
The group also called for the immediate shutdown of Reactor 1 of the plant.
Greenpeace also accuses EDF and AREVA of falsifying safety certificates of the plant so that the authorities won’t shut it down.
“EDF, as the operator, has in fact decided to give priority to economic interests instead of protecting people and the environment.”
Fessenheim has recently been the topic of heated discussion, which even took place in the Elysee Palace. In April, President Francois Hollande promised to formally initiate the shutdown of France’s oldest nuclear reactors on the grounds of environmental and safety concerns.
Also in October, the Nuclear Safety Authority (ASN) asked EDF to shut down and inspect the plant. Fessenheim houses two 920 megawatt reactors and has been running since 1978, making it France’s oldest operating nuclear power plant. The German government and activists alike have long been calling for it to be permanently closed.
The plant is situated on a seismic fault line, making it vulnerable to earthquakes and flooding. The German government has repeatedly called on France to terminate the Fessenheim plant as soon as possible, after an April 2014 accident when one of the reactors had to be shut down as water was found leaking from several places.
France has 58 nuclear reactors with a total capacity of 63.2 Gigawatts. The country gets two thirds of its electricity from nuclear energy.
France’s nuclear-energy champion is in turmoil http://www.economist.com/news/business/21711087-electricit-de-france-has-had-shut-down-18-its-58-nuclear-reactors-frances-nuclear-energy Electricité de France has had to shut down 18 of its 58 nuclear reactors THESE are difficult times for Electricité de France (EDF), the country’s quasi-monopolistic electricity provider, serving 88% of homes. Outages at no fewer than 18 of the 58 EDF-owned nuclear reactors that provide three-quarters of France’s electricity have meant a slump in production: the company says annual nuclear output could fall to 378 terawatt hours (TWH), from 417 TWH last year. Eight reactors are currently lying idle and several may not restart for weeks or months. Power stations are burning coal at a rate not seen since the 1980s. As electricity imports and prices soar, officials are having to deny that a cold snap could bring blackouts.
The cause of the crisis—possibly faulty reactor parts throughout EDF’s fleet—suggests it may not be easily contained. France’s nuclear regulator, the Autorité de Sûreté Nucléaire (ASN), this summer ordered urgent tests of reactor parts, mostly bases of cylindrical steam generators. Inspectors are worried about high carbon levels found in steel forged by Creusot Forge, which is owned by Areva, another French firm, and by Japan Casting & Forging Corporation, a Japanese supplier. In some pieces carbon deposits are over 50% above permitted levels, risking fracture in case of a sudden change in the temperature of the steel.
The cost for EDF is rising. As well as lost earnings from shuttered plants, switching one generator (a reactor can have three) can take six months and cost €150m ($159m). And its decision in November finally to stump up €2.5bn for Areva Nuclear Power (most of Areva, including Creusot Forge) now seems rather like paying to swallow a highly radioactive dinner.The two firms have one important joint project: a new European Pressurised Reactor (EPR), built by Areva and mostly run by EDF. Here too, forging faults are a problem: they were first found last year on the installed reactor vessel at Flamanville 3, a new EPR near Cherbourg. Another serious source of concern is safety-valve design.
The regulator will rule on Flamanville’s future in mid-2017. More tests or design changes may mean putting off its opening far beyond 2018.That would also deliver another blow to France’s reputation in nuclear power. The only other EPR in Europe, that at Olkiluoto, Finland, is years overdue and three times over budget.
Delays might also hinder EDF in its plan to build two EPRs at Hinkley Point, in Britain, for £24.5bn ($30.7bn). British loan guarantees need certain conditions to be met, and these reportedly include seeing Flamanville operate by 2020. Steve Thomas, an energy expert in London, concurs with the opinion of many in the nuclear-power industry when he calls the EPR a dud. EDF is pushing on regardless, but the financial strain is mounting. In March, EDF’s then chief financial officer, Thomas Piquemal, quit, calling Hinkley Point unaffordable.
The sense of crisis looks likely to grow. Yves Marignac, a nuclear-energy expert in Paris, calls EDF “already financially crippled”. Only state backing prevents EDF’s credit rating falling steeply, analysts say. And it is not only the ASN that has EDF in its sights. On November 22nd French competition officials raided its offices, seeking evidence that its dominant position is squeezing rivals and sending prices higher than they should be (even though lower electricity prices in recent years have sapped its revenues). Its share price has halved in two years.
The future looks bleak. Some four-fifths of French nuclear plants were built in a decade from the late 1970s. The plants have a 40-year lifespan, meaning that several a year face retirement over the next decade. Energy planners have assumed there will be extensions to 50 years or more. But the ASN may hesitate after the forging problems, or impose higher costs. Cyrille Cormier, a nuclear engineer who is now at Greenpeace, a campaign group that opposes nuclear power, says a total refit could cost EDF an extra €60bn-200bn.
Closing plants permanently would be extremely costly, too. France has never closed a large one. EDF may be under-provisioning the costs of decommissioning plants. It has set aside €36bn, less than the €45bn that Germany has allowed, even though France’s neighbour has a smaller nuclear fleet. Then there is nuclear waste. The five pools storing spent fuel at La Hague, Areva’s central reprocessing plant, are nearly full, says Mr Marignac. When sorrows come, they come in battalions.
French nuclear power in ‘worst situation ever’, says former EDF director
In the week Britain exports electricity to France for first time in four years, Gérard Magnin says renewable power will match Hinkley Point C on cost, Guardian, Adam Vaughan, 29 Nov 16, The French nuclear industry is in its “worst situation ever” because of a spate of plant closures in France and the complexities it faces with the UK’s Hinkley Point C power station, according to a former Électricité de France director.
Gérard Magnin, who called Hinkley “very risky” when he resigned as a board member over the project in July, told the Guardian that with more than a dozen French reactors closed over safety checks and routine maintenance, circumstances for the state-owned EDF had deteriorated since he stepped down.
The closures have seen Britain this week exporting electricity to France for the first time in four years. An industry report on Tuesday also warned that the offline reactors could lead to a “tense situation” for energy supply in France, in the event of a cold snap this winter.
The situation is likely to be exacerbated by damage during Storm Angusto the main cable that carries electricity back and forth between the UK and France. It is believed a boat dropping anchor during the storm may have been responsible but National Grid is investigating the cause and working to repair the Interconnexion France-Angleterre, which is buried in the seabed and heavily armoured.
The operator said that four of the eight cables in the interconnector had been damaged, reducing its capacity from 2,000MW to 1,000MW until February next year. It added that due to the French reactor closures, it had already factored in a reduction in energy supplies from France this winter.
Magnin said that instead of backing new nuclear, the UK and France should capitalise on falling wind and solar power costs and help individuals and communities to build and run their own renewable energy projects. He founded an association of cities switching to green energy, joined the EDF board in 2014, and is now director of a renewable energy co-op in France.
“The most surprising [thing] for me is the attitude of the UK government which accepts the higher cost of electricity … in a time where the costs of renewables is decreasing dramatically,” he said. “In 10 years [when Hinkley Point C is due to be completed], the cost of renewables will have fallen again a lot.”
Of the Hinkley C design, known as the European Pressurised Reactor (EPR), Magnin said: “A lot of people in EDF have known for a long time the EPR has no future – too sophisticated, too expensive – but they assume their commitments and try to save the face of France.”
The UK’s business department conceded in September that by the time Hinkley is operational the price of electricity guaranteed to EDF will be above the comparable costs for large-scale solar and onshore windfarms. Officials argued that using renewables instead would cost more in grid upgrades and balancing the intermittent nature of wind and solar……. https://www.theguardian.com/environment/2016/nov/29/french-nuclear-power-worst-situation-ever-former-edf-director
EDF faces a seemingly impossible financial equation. It has colossal debt of €37 billion; it must deal with the complex €2.5 billion takeover of Areva; and find the money to extend the life of its 58 reactors at costs estimated between €60 and €100 billion up to 2030. (8)
Meanwhile EDF has been accused by Greenpeace France of grossly underestimating the cost of nuclear electricity.
Greenpeace claimed that if EDF disclosed the true cost of running its fleet of reactors in France while financing two new ones in the UK, it would be declared bankrupt.
“In summary, the French nuclear fleet is at the end of its course, dilapidated and dotted with deficient parts. At the same time, the finances of EDF are in such a deplorable state that the company could soon join Areva in bankruptcy, and is in any case unable to properly maintain its reactors.”
NuClear News No 90 , 26 Nov 16 Problems discovered at Areva’s metal forge at Le Creusot have been growing over the past six months and are now even threatening to derail EDF’s takeover of Areva’s reactor business.
Last spring when Economy Minister Emmanuel Macron visited to tell the workers at Le Creusot that he had every confidence in the nuclear sector, despite the difficulties, 400 files which were being examined for suspected “anomalies” had to be hastily moved out of the meeting room. Now, six months later a crane has been moving prefabricated office buildings into position so that 6,000 records concerning nuclear components – 2.4 million pages – forged at Le Creusot over the last 60 years can be re-examined. Areva has had to accept that the original 400 suspicious files are just the tip of an iceberg and not the only ones containing “irregularities”. 50 people are now trawling through the paperwork and as many more are being recruited for a job that will take at least another eighteen months.
EDF’s CEO Jean-Bernard Lévy says if Le Creusot’s “problems prove insurmountable, the acquisition will not happen”. (1)
With potentially more than half of France’s 58 reactors affected by the “carbon segregation” problem the French nuclear watchdog, the Autorité de Sûreté Nucléaire (ASN) has ordered preventative measures to be taken immediately to ensure public safety. ASN confirmed that, as of late October, 20 reactors were offline and more could be shut down over coming weeks.
Questionable Materials and Documentation
At the heart of France’s nuclear crisis are two problems. One concerns the carbon content of the steel used in critical reactor components, steam heat exchangers, and other components manufactured or supplied by AREVA SA, the French state-owned nuclear engineering firm and global producer of nuclear reactors. The second problem concerns forged, falsified, or incomplete quality control reports about the critical components themselves. Excessive levels of carbon in the steel parts could make them more brittle and subject to sudden fracture or tearing under sustained high pressure, which is obviously unacceptable.
Steam generators from 18 reactors have carbon levels that are above the acceptable level. Some of these were forged at Le Creusot, but others were forged in Japan by JCFC, a subcontractor of Areva. Twelve reactors equipped with JCFC steel are still at a standstill and will be in December while inspections are carried out.
The massive outages are draining power from all over Europe. In the event of severe cold weather this winter, there could be blackouts. Worse, new questions continue to swirl about both the safety and integrity of EDF’s nuclear fleet, as well as the quality of some French- and Japanese-made components that EDF is using in various high-profile nuclear projects around the world.
In October EDF was forced to reduce its 2016 generation targets from 395–400 TWh to 380– 390 TWh, while estimates for nuclear output in 2017 have also been lowered to between 390 TWh and 400 TWh. For perspective, annual nuclear production averaged 417 TWh in the period 2005–2015.
The problem was originally discovered at the Flamanville EPR project in 2014. Since then an internal probe at Le Creusot where many of the components in question were manufactured, has uncovered new anomalies. AREVA is now reported to be reviewing all 9,000 manufacturing records at the forge dating back as far as 1943, including files from more than 6,000 nuclear components.
This autumn there have been almost weekly revelations resulting in plant shutdowns, extended outages, reduced generation, and lots more questions. According to ASN there are now a significant number of reactors offline, with more to be inspected in the next few weeks. “We are now finding carbon segregation problems from components coming from both Le Creusot and [the Kitakyushu-based Japan Casting & Forging Corp.] JCFC plant. As for now, there [are] 20 EDF reactors offline,” the official said, noting that the number will fluctuate as inspections take place.
The analyses performed by EDF thus far have found that since 2015 certain channel heads of the steam generators manufactured by Le Creusot and JCFC “contain a significant carbon concentration zone which could lead to lower than expected mechanical properties,” according to ASN. The Japan Times reports that the JCFC is now also under scrutiny by Japan’s Nuclear Regulation Authority.
Shaun Burnie for Greenpeace said “As a result of substandard manufacturing in Japan, citizens in France have been unknowingly exposed to the risk of catastrophic failure of critical reactor components which could result in a reactor core meltdown. Japanese-supplied steel is now at the centre of France’s unprecedented nuclear crisis the scale of which has never been seen in any country. All 12 reactors supplied by JCFC are either in forced shutdown or about to be. It lacks all credibility that the Japanese nuclear industry would claim that there are no implications for the safety of their own nuclear reactors. The steel production records released in France did not reveal the scale of excess carbon, which was only found after physical testing. There are currently no plans for such tests in Japan. That is wholly unacceptable. There are many urgent questions that need to be answered by the industry and the NRA, and with full public disclosure and transparency.” (2)
Energy traders and analysts warn that the French market needs to prepare for longer maintenance periods in coming years given the age of the nuclear fleet and the continuing design flaw revelations. With the average French reactor now more than 30 years old, equipment will need to be replaced more frequently, and increasingly stringent safety requirements will mean that components could be delayed, especially as ASN imposes additional checks. The safety inspections and other reviews “will lead in particular to extensions of certain planned outages,” EDF said in a press release.
Erring on the Side of Safety?
Despite the outages and findings from the carbon quality investigations, EDF continues to downplay the risk. “The safety margins are very large and the carbon content does not undermine integrity or security, even in the case of an accident,” an EDF spokesperson told Le Monde newspaper. But questions about quality control practices at Le Creusot continue to grow. Indeed, the greater the scrutiny, the more problems are being discovered. The number of components affected by irregularities and already installed in operating reactors increased from 33 known issues in April to 83 by the end of September. Startlingly, irregularities affecting just the Flamanville EPR project increased from two to 20 during the same period.
While EDF and AREVA are dealing with costly damage control, ASN and other agencies are erring on the side of caution. Indeed, the ASN representative said, “We take no risks. That is the rule. If we don’t know the dangers of the carbon segregation, then we must take the reactors offline until we know what the situation is and [can confirm that] it’s not dangerous.”
ASN revealed that AREVA has now identified at least 87 irregularities concerning EDF reactors in operation, including vessels, steam generators, and main primary system piping, plus the 20 issues for parts intended for Flamanville 3, and one more affecting a steam generator planned for installation in Gravelines 5. Inspectors have also found four irregularities affecting transport packaging for radioactive substances. ASN said that whatever the outcome of these investigations, the irregularities “reveal unacceptable practices.”
External Parties Push for Answers
After the discovery of anomalies in the composition of steel in certain zones of the vessel closure head and the vessel bottom head of the EPR reactor being built at Flamanville in 2014, an internal audit was carried out and released in April 2015, suggesting the existence of many more anomalies. These were initially downplayed by ASN and AREVA. But in September 2015 an independent evaluation conducted by Large and Associates for Greenpeace France really set the cat amongst the pigeons. “The nature of the flaw in the steel, an excess of carbon, reduces steel toughness and renders the components vulnerable to fast fracture,” said the report’s author, John Large. The Greenpeace report, “Amplified the questions ASN already had,” said an ASN representative.
12 reactors have been identified by ASN to have carbon problems in replacement steam generators forged by JCFC. In these reactors initial surface tests were followed by more invasive studies. The first reactors to enter scheduled refuelling outages for a more thorough examination were Tricastin 1 and 3. The early nondestructive inspection results for the JCFC bottom channel heads at these reactors revealed an alarming 0.39% level of carbon present, almost 100% greater than the maximum permissible level. That finding, with its associated reduction in material toughness, rendered the component vulnerable to fast fracture, reported Greenpeace in a late October update. ASN decided to order the shutdown of all but one of these reactors and these shutdowns will remain in force until EDF can demonstrate each reactor is safe to re-enter service.
At a French parliamentary hearing into the situation on October 25, ASN said it would need another year or two to examine the thousands of documents at the Le Creusot foundry and more anomalies and irregularities will probably be discovered. (3
As of late October 2016 ASN has confirmed the following:
- Six reactors have been granted approval to restart and are operating normally: Blayais 1, Chinon 1 and 2, Dampierre 2 and 4, and Saint-Laurent-des-Eaux B2.
- Seven reactos are in planned outages and have been, or are being, inspected. They are: Bugey 4, Civaux 2, Dampierre 3, Gravelines 2, Saint-Laurent-des-Eaux B1, and Tricastin 1 and 3. (4) The Times reports that the re-start of Civaux 2 and Dampierre 3 has been delayed until 31st December.
(5) · Five reactors have been ordered by ASN to be taken offline to conduct checks before 18th January 2017. They are: Civaux 1, Fessenheim 1, Gravelines 4, and Tricastin 2 and 4. (6)
- Three reactors are currently scheduled to remain unavailable throughout the winter months. They are: Bugey 5, Gravelines 5, and Paluel 2.
- One reactor has been ordered by ASN to shut down following the detection of an irregularity in the lower shell of the steam generator. That unit is Fessenheim 2.
- Incidentally, Paluel 2 has been offline since May 2015. Its maintenance period is continuing, following an incident on March 31, 2016, in which a 465-ton steam generator tipped over during removal. (7)
EDF faces a seemingly impossible financial equation. It has colossal debt of €37 billion; it must deal with the complex €2.5 billion takeover of Areva; and find the money to extend the life of its 58 reactors at costs estimated between €60 and €100 billion up to 2030. (8)
Meanwhile EDF has been accused by Greenpeace France of grossly underestimating the cost of nuclear electricity.
Greenpeace claimed that if EDF disclosed the true cost of running its fleet of reactors in France while financing two new ones in the UK, it would be declared bankrupt. Greenpeace commissioned an audit by AlphaValue, the equity research company. The French government has agreed to inject €3 billion into the group this year and has renounced dividend payments until next year. Shares in EDF, 85% of which are owned by the French state, have lost almost a third of their value in the past year and the company is no longer listed on the Paris blue-chip index.
The AlphaValue report described EDF as an “uncompetitive firm – incapable of reacting rapidly and efficiently to the variations in electricity needs and the changes created by the liberalisation of European markets”. It said that EDF’s rivals had written down the value of their nuclear plants because of the move to renewable energy and the fall in electricity prices and that EDF had failed to follow suit. Juan Camilo Rodriguez, author of the report, said the company might have to close 17 of its 58 French reactors to meet the government’s requirement that nuclear power should provide 50 per cent of the nation’s electricity in 2025, down from 75 per cent now.
“The provisions to safeguard the burden of financing the decommissioning of the French reactors are far from sufficient. [If 17 are closed], the group should increase its provisions by more than €20 billion.” Mr Rodriguez said the cost of handling nuclear waste added at least €33.5 billion to that figure. “Whatever scenario is retained, an adjustment of the nuclear provisions . . . would lead to the bankruptcy of EDF from an accountancy point of view,” he added. The report said that EDF would need to find a further €165 billion during the next decade to finance projects such as Hinkley Point and the renovation of reactors in France. EDF says it will spend €51 billion renovating its reactors and £12 billion on Hinkley Point. A spokesman for EDF accused AlphaValue of making erroneous calculations that failed to take account of long-term electricity price movements and differences between France and other European markets. (9) Greenpeace filed a complaint against EDF and its CEO, Jean-Bernard Lévy, for “stock trading offences” at the end of November and EDF responded by suing the group for making “false allegations”.
Greenpeace has asked the public prosecutor “to open a preliminary investigation or to appoint an investigating judge”, saying that “shareholders, investors but also French citizens are being misled by EDF and its CEO”. (10)
According to Stéphane L’homme, Directeur de l’Observatoire du nucléaire: “In summary, the French nuclear fleet is at the end of its course, dilapidated and dotted with deficient parts. At the same time, the finances of EDF are in such a deplorable state that the company could soon join Areva in bankruptcy, and is in any case unable to properly maintain its reactors.” http://www.no2nuclearpower.org.uk/nuclearnews/NuClearNewsNo90.pdf
France could face winter power cuts, hit by nuclear dependence, Channel News Asia,
09 Nov 2016 PARIS: France could impose power cuts this winter due to an electricity shortage, an unprecedented step in the wealthy nation which would expose the vulnerabilities of its dependence on nuclear power.
The warning was issued on Tuesday by grid operator RTE, which said power supply had been hit by the closure of around a third of the country’s ageing nuclear reactors for safety checks. The country’s regulator has ordered a review of the strength of crucial steel components after the discovery of manufacturing irregularities.
France relies on nuclear for three-quarters of its power, more than any other country. RTE said the amount of nuclear power available was at a record low for this time of year, around 10,000 megawatts lower than a year ago – equivalent to more than twice the consumption of Paris and Marseille combined……..
The discovery last year of weak spots in the steel of the EPR reactor state-backed utility EDF is building in Flamanville in northwest France led nuclear regulator ASN to take a closer look at manufacturing procedures of state-owned reactor builder Areva.
In May, the ASN said the anomalies found in Flamanville had also been discovered in reactors being operated by EDF and ordered safety tests on 18 out of EDF’s 58 reactors.
Unlike other nuclear countries such as the United States and China, which have used different reactor models and suppliers, all French reactors are pressurised water reactors made by the same manufacturer, a forerunner of Areva.
This standardisation allowed France to build reactors relatively quickly and cheaply, but also created the risk that a generic design flaw or manufacturing problem would affect many reactors and incapacitate a large part of the fleet. Green activists have warned of this possible scenario for years………
“The outlook is pessimistic, notably for the first three weeks of December,” said a Paris-based power trader, adding that power outages could easily happen.
The reactor closures are weighing on the power sales of EDF, which has cut its nuclear production target three times this year. They are also forcing the utility to buy expensive power on the market, further weighing on its profitability.
Ratings agency Moody’s said on Tuesday that EDF was unlikely to benefit from rising power prices offsetting the expected shortfall in volumes.
Last week, EDF issued its second profit warning of the year, lowering its 2016 core earnings forecast to 16-16.3 billion euros from the original 16.3-16.8 billion euros.
The company finally secured approval from the British government in September to go ahead with its 18 billion pound (US$22 billion) project to build two nuclear reactors at Hinkley Point in England………
EDF has faced internal dissent over the project, with many critics saying the company’s balance sheet is already too stretched. EDF needs to borrow money just to pay its dividend, and will have to spend about 50 billion euros (US$55.1 billion) on upgrading its ageing nuclear fleet and several billion more for its planned takeover of the reactor division of Areva http://www.channelnewsasia.com/news/world/france-could-face-winter-power-cuts-hit-by-nuclear-dependence/3272948.html
France’s Nuclear Storm: Many Power Plants Down Due to Quality Concerns, Power, 11/01/2016 | Lee Buchsbaum The discovery of widespread carbon segregation problems in critical nuclear plant components has crippled the French power industry—20 of the country’s 58 reactors are currently offline and under heavy scrutiny. France’s nuclear safety chairman said more anomalies “will likely be found,” as the extent of the contagion is still being uncovered.With over half of France’s 58 reactors possibly affected by “carbon segregation,” the nation’s nuclear watchdog, the Autorité de Sûreté Nucléaire (ASN) has ordered that preventative measures be taken immediately to ensure public safety. As this story goes into production in late October, ASN has confirmed that 20 reactors are currently offline and potentially more will shut down in coming weeks.
The massive outages are draining power from all over Europe. Worse, new questions continue to swirl about both the safety and integrity of Électricité de France SA’s (EDF’s) nuclear fleet, as well as the quality of some French- and Japanese-made components that EDF is using in various high-profile nuclear projects around the world……….
Questionable Materials and Documentation
At the heart of France’s nuclear crisis are two problems. One concerns the carbon content of critical steel parts, steam heat exchangers, and other components manufactured or supplied by AREVA SA, the French state-owned nuclear engineering firm and global producer of nuclear reactors. The second problem concerns forged, falsified, or incomplete quality control reports about the critical components themselves. Continue reading
France avoids nuclear plant closure decision as election looms http://www.reuters.com/article/us-france-energy-nuclearpower-idUSKCN12S2DG
France has delayed a decision on promised nuclear reactor decommissioning, effectively putting on hold a process that could ultimately be overturned with a change of government next year.
A government investment roadmap published on Friday stopped short of identifying reactors for closure under 2015 legislation that commits France to reducing atomic energy to 50 percent of its electrical power mix, from more than 75 percent currently.
Instead, the Energy Ministry plans leaves it to state utility EDF to issue a strategic review of plants and energy requirements around April of next year.
However, the final decision on whether the reactors are scrapped is a political one.
France goes to the polls in the first round of presidential voting in April, followed by legislative elections in June – meaning the issue looks unlikely to be resolved before a new president and assembly has been elected.
Former Prime Minister Alain Juppe, the conservative candidate currently leading the race, has called Socialist President Francois Hollande’s 50 percent target absurd and vowed to scrap it, in common with several other right-wing candidates.
Lawmaker Herve Mariton, a Juppe ally and prominent energy specialist among the conservative Les Republicains, has also rejected Hollande’s plan to close EDF’s ageing Fessenheim plant after a new reactor opens at Flamanville in 2018.
Opinion polls show conservative candidates easily defeating any potential Socialist rivals in the presidential election, which takes place in two rounds, the second due in May.
Environmental group Greenpeace said the French government was failing to implement the 2015 energy law and had betrayed last year’s Paris Climate Agreement to curb climate-warming emissions by not doing enough to support renewable energy alternatives.
In order to meet the 2015 commitment, France would have had to decide on the shutdown of 22 reactors by now, it said.
According to the energy investment plan published on Friday, a decision to close Fessenheim, France’s oldest nuclear plant, will be taken by the end of the year. The plan also pledged to almost double renewable power output to 150-167 terawatt hours (TWh) by 2030. The plan also seeks to cut nuclear power output by 10 to 65 TWh by 2023.
France’s nuclear watchdog wants to shut down 5 reactors over failure risk https://www.rt.com/news/363484-france-nuclear-shut-down/ 20 Oct, 2016 10: The French nuclear watchdog has called for the shutdown and inspection of five more nuclear reactors for safety checks. The reactors have a high level of carbon which could lead to various failures.
The Nuclear Safety Authority (ASN) has asked nuclear power utility EDF to carry out additional inspections at Fessenheim 1,Tricastin 2 and 4, Gravelines 4 and Civaux 1 reactors, according to a press release. All these reactors are located across the whole France, close to towns and communes.
“The performance of these inspections will require shutdown of the reactors concerned,” ASN added. The watchdog wants to check “certain channel heads of the steam generators on five of its reactors, in which the steel is affected by a high carbon concentration.”
According to ASN’s analysis, “certain channel heads of the steam generators … contain a significant carbon concentration zone which could lead to lower than expected mechanical properties.”
The watchdog said that it doesn’t want to wait “for the scheduled refueling outage of these reactors” and thus demands safety checks “within three months.”
According to the Local, this abnormality could lead to failures in mechanical properties and even to leaks or explosions.
The five reactors under scrutiny are among 18 at which ASN found abnormalities in June. Of the 18 reactors ASN says that six could be restarted after inspection. Seven others (Bugey 4, Civaux 2, Dampierre 3, Gravelines 2, Saint-Laurent-des-Eaux B1 and Tricastin 1 and 3) are being inspected and awaiting reboot.
CEO of ASN Olivier Gupta downplayed the concerns in comments to Le Monde newspaper, saying “the safety margins are very large and the carbon content does not undermine integrity or security, even in the case of an accident.”
France has 58 nuclear reactors with total capacity of 63.2 GWe. The country gets two thirds of its electricity from nuclear generation. READ MORE: Risk of nuclear theft, sabotage, cyberattacks by terrorists may be increasing – report
In April, President Francois Hollande promised to formally initiate the shutdown of the France’s oldest nuclear reactors on the grounds of environmental and safety concerns surrounding the Fessenheim power plant near the German and Swiss borders.
READ MORE: Hollande vows to shut down France’s oldest nuclear power plant Fessenheim houses two 920 megawatt reactors and has been running since 1978, making it France’s oldest operating plant. Due to its age, the German government and activists alike have long been calling for it to be permanently closed.
The German government has repeatedly called on France to terminate the Fessenheim plant as soon as possible, after an April 2014 accident when one of the reactors had to be shut down as water was found leaking from several places.
French winter forward power prices rally on fresh nuclear concerns Reuters By Vera Eckert and Bate Felix FRANKFURT/PARIS, Oct 18 French forward power prices hit fresh highs on Tuesday on persistent worries over further nuclear power reactor downtime in coming months at five plants, which could tighten European electricity supplies in winter.
Nuclear watchdog ASN has told state utility EDF to conduct tests on the five nuclear reactors before their scheduled maintenance period, potentially adding further pressure to the country’s already tight supply situation.
ASN said in a statement that the five reactors to be tested were: the 1,500 MW Civaux 1 (no maintenance date set); 900 MW Fessenheim 1, scheduled to go offline on Oct. 22; 900 MW Gravelines 4, scheduled for planned outage in April 2017; 900 MW Tricastin 4, scheduled for statutory outage on Oct. 22, and the 900 MW Tricastin 2 scheduled for outage in April 2017……..
Traders questioned France’s seemingly patchy outage reporting standards compared with their northwest European peers, who update the market of any slight changes in production outlook, especially since French power markets are exerting such a big pull over the broader European energy complex.
“Why is the market mover of all European commodities not saying a word about its own nuclear problems?,” a trader said.
French energy market regulator CRE said separately that it was paying attention to the reasons for the sharp rise in French forward power prices, and was paying particular attention to transparency obligations under European Union REMIT regulations. ($1 = 0.9098 euros) (Additional reporting by Oleg Vukmanovic and Geert De Clercq; Editing by Mark Potter and Adrian Croft) http://www.reuters.com/article/power-france-idUSL8N1CO4UV?feedType=RSS&feedName=utilitiesSector
Thousands protest against nuclear power in northern France http://en.rfi.fr/environment/20161001-thousands-protest-against-nuclear-power-northern-france Several thousand people demonstrated against the construction of nuclear reactors near the northern French town of Flamanville on Saturday. British opponents of the planned reactor at Hinkley Point joined European opponents of nuclear power.
The protesters gathered at Siouville-Hague, between a nuclear waste treatement centre at La Hague and the site of a third nuclear reactor at Flamanville, which is currently under construction.
The first protest against the plan took place 10 years ago at Cherbourg on the Channel coast.
French power company EDF, which is also building the Hinkley Point reactor, says it should be ready to operate in the third quarter of 2018, six years late.
Its cost has trebled to 10.5 billion euros after a number of problems.
French Green MP and possible presidential candidate Cécile Duflot joined the demonstration, as did a number of British anti-nuclear activists.
Opponents claim that nuclear power is dangerous and expensive. The sector employs about 10,000 people in Normandy.
As for For Hinkley Point C, it now appears inevitable that the Flamanville reactor will not be completed by its target date of the end of 2020, indeed it may very well never be completed at all. Under the terms of agreement for the plant’s construction accepted by the European Commission, this would render the UK government unable to extend promised credit guarantees to HPC’s financial backers.
for EDF, Areva, their shareholders and the entire French nuclear industry, the end really could be nigh.
France’s Nuclear Power Stations ‘At Risk of Catastrophic
Failure’ http://www.globalresearch.ca/frances-nuclear-power-stations-at-risk-of-catastrophic-failure/5548593 Sizewell B and 27 Other EDF Nuclear Plants By Oliver Tickell Global Research, October 01, 2016 The Ecologist 29 September 2016 A new review of the safety of France’s nuclear power stations has found that at least 18 of EDF’s units are are ”operating at risk of major accident due to carbon anomalies.”
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