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France's EDF backs nuclear plan but UK delays
By Martine PAUWELS
Paris (AFP) July 28, 2016

UK nuclear project delay is 'bonkers': trade union
London (AFP) July 29, 2016 -British trade unions criticised the government on Friday for delaying its final decision on the Hinkley Point nuclear power plant, seen by British media as backtracking on the project.

"Theresa May's decision to review the go-ahead on HPC is bewildering and bonkers," said Justin Bowden, the GMB union's national secretary for energy, about Britain's new prime minister.

"After years of procrastination, what is required is decisive action not dithering and more delay," he said.

Business and energy minister Greg Clark on Thursday said that the government "wanted time to study the details of the deal" and would not give a decision until early autumn.

Kevin Coyne from Unite, Britain's biggest trade union, said jobs could be lost and the delay could penalise economic growth.

"Any further delay or backsliding would hold back the economic boost and the accompanying creation of thousands of skilled jobs that this major infrastructure project will bring," he said.

After years of discussion, French energy giant EDF on Thursday approved the PND 18 billion project ($24 billion, 21 billion euros) for two EPR nuclear reactors in Somerset in south-west England.

EDF chief executive Jean-Bernard Levy on Friday said at the company's earnings announcement: "I don't doubt the support from Theresa May's British government".

French unions have re-asserted their opposition to a project that they say risks plunging the group in financial difficulties.

French energy giant EDF on Thursday approved a contested plan to build Britain's first nuclear power station in decades but the British government said it would wait before taking a final decision.

Britain's Business and Energy Minister Greg Clark said the government would review the nuclear project, shortly after EDF's board backed a project which critics fear could bankrupt the French utility.

"The UK needs a reliable and secure energy supply and the government believes that nuclear energy is an important part of the mix," Clark said.

"The government will now consider carefully all the component parts of this project and make its decision in the early autumn," he said.

Before the deal can go ahead it must be approved by Prime Minister Theresa May.

EDF's directors had been deeply divided over the planned construction of two nuclear reactors at Hinkley Point in southwest England for PND 18 billion (21.4 billion euros, $23.8 billion).

"At its meeting on 28 July 2016, EDF's board of directors made the final investment decision," the company said in a statement.

Ten members of the board voted in favour of the deal, while seven voted against, a source told AFP.

Upping the tension, one board member resigned just before the crunch meeting, saying he disagreed with the plan, reducing the board of directors to 17.

- Unions seek delay -

The Sizewell B nuclear power plant was the last to go online in Britain, starting generation in 1995.

The plan to build the latest generation EPR reactors, signed in 2013, is to be carried out by EDF with Chinese partner CGN, but has hit several snags since.

The reactors are due to go online from 2025.

Weighing on its viability is the decision of French nuclear company Areva to drop out because of financial difficulties and the subsequent takeover of Areva's obligations by EDF at the behest of the French government, which owns 85 percent of EDF.

This pushed EDF, which was already struggling under a debt mountain of 37.4 billion euros ($41.4 billion) at the end of last year, to go further into the red, leading some to question the group's ability to juggle all its liabilities, including the renovation of France's nuclear operations and the takeover of Areva's reactors amid falling energy prices.

Unions fear for EDF's financial survival and have asked for a delay of at least three years of any decision on the British nuclear plans, even waging a court battle to stop the momentum.

EDF chief financial officer Thomas Piquemal resigned in March over the threat the project represents to the company's finances, and CEO Jean-Bernard Levy has acknowledged that the company's "financial trajectory is taut".

EPR reactors, developed mostly by France's Areva, are the latest generation of nuclear reactors and among the most powerful in the world, and according to Areva, the safest.

There are only two other ongoing EPR reactor projects in Europe, one in Normandy in France and the other in Finland, and both have been plagued by delays and cost overruns.

- 'Too big to fail' -

The French government has been doggedly determined to get Hinkley Point approved as it sees the project as crucial for the long-term viability of France's nuclear industry, which employs 220,000 people.

Previous British governments have also been in favour because the reactors will cover up to seven percent of Britain's electricity needs while helping the government meet its CO2 emissions targets because of relatively low carbon emissions from nuclear energy.

But British support is not unanimous, and criticism focuses on the growing difference between an electricity price guarantee for EDF, subsidised by the British taxpayer, and current falling energy prices.

EDF would be guaranteed PND 92.50 per megawatt hour produced by Hinkley Point over 35 years, giving it an estimated nine percent of return on its capital.

But Britain's National Audit Office has warned that the potential cost of this subsidy had risen to PND 29.7 billion from a 2013 estimate of PND 6.1 billion because of the drop in energy prices.

There have also been environmental concerns.

Greenpeace executive director John Sauven said the power station was "terrible value for money".

The EDF decision "just shows the Hinkley deal became too big to fail in the eyes of British and French politicians," he said.

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Previous Report
French state to pump 3 bn euros into EDF
Paris (AFP) July 26, 2016
France will pump 3 billion euros into state-controlled electricity company EDF, shareholders decided Tuesday, two days before it is expected to give the final green light to the controversial construction of two nuclear reactors in Britain. At an extraordinary meeting, shareholders approved a 4-billion increase in share capital, of which the French state, which owns 85 percent of EDF, is to ... read more

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