Tuesday, 26 January 2016

EDF wants French Government to pay for British nuclear reactor at Hinkley C!

As if anything extra was needed to demonstrate the financial lunacy of the Hinkley C project to all parties concerned, EDF, according to French press reports, now wants the French Government to pay for it!
See http://www.lesechos.fr/industrie-services/energie-environnement/021648964646-epr-anglais-edf-peine-a-boucler-son-plan-de-financement-1195310.php

Quite why anyone would want to take responsibility for a project  whose potential lossmaking wildly exceeds even the over-generous offer made by the UK treasury and electricity consumers, beggars belief. Clearly EDF now do not want to. Under increasing pressure from company shareholders, unions, rating agencies, and others EDF has concluded that it just doesn't have the cash to fund this disaster-in-waiting.

Of course the subtext, is, as I have said for several years now, this project is unfinanceable in any rational way apart from being the receipt of a government blank cheque (if one accepts that as rational way!). Now, in effect EDF expects TWO governments to pay for it (UK and France)!

The EPR model to be used in Hinkley C has now failed to be built on time (indeed at all yet) in all of its three projects. Even in France, the nuclear regulators ASN have given the developers some scathing criticism. The model has been described as unconstructable - and this is before we come to discover whether it even works!

EDF was once held up as an example of how the nuclear industry is a success. But now the company is sinking into debts and potential losses as the prospect of paying large sums for not just dealing with nuclear waste but also repairing existing plant, as well as the failure of the EPR projects in Finland, france and China, comes to haunt the company. Funding Hinkley C could well be final death blow for EDF, as I commented not long ago. See http://realfeed-intariffs.blogspot.co.uk/2016/01/more-daishan-epr-delays-as-edf-ponder.html
Of course, one has to see some humour in this. It is that the French Government - and this means French taxpayers are going, if EDF's requests are granted - to make more or less direct subsidies to British electricity (state aid by other, rather curious, means). And they could end up up paying through the nose for this project since it could end up a virtually bottomless pit, if as seems a racing certainty, the project overruns.

Of course, in the end it would probably end up being as just a big row between the two governments and both would end up paying - the British electricity consumer would end up paying way more than the £92.50 per MWh (2012 prices) for 35 years it is already scheduled to do, and the French Government a lot more too, if EDF get their way.
A lot of officials on both sides of the Channel are now thinking 'how do we get out of this without getting the blame'. This latest request for more support for the French Government is just one more excuse for delaying a project that needs to be formally killed off. It should just be stopped and the money spent instead on renewables and energy saving.

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