EDF decision on Hinkley Point put back until early May
22 March 2016
- From the section Business
French economy minister Emmanuel Macron says EDF will now make a final investment decision on the Hinkley Point nuclear reactor in early May.
A decision on the £18bn nuclear plant had widely been expected on 30 March.
It is the latest postponement by EDF, which is 85% French state owned, over how it will fund the project.
Speaking before the French parliament’s Economic Affairs Committee, Mr Macron also said it was unlikely EDF would choose not to take part in the project.
“The principal nuclear project in the developed world is Hinkley point,” Mr Macron said.
“Can we legitimately choose not to take part in the largest nuclear project in the developed world? For my part, I don’t think so.”
Earlier, referring to the movement of the decision date, he said to the committee: “Why the start of May?
Analysis: By Simon Jack, BBC News business editor
EDF faces substantial risks if it goes ahead with Hinkley Point.
Not only does it have to come up with the cash to complete the project – it also has to find €55bn to service France’s ageing 58-strong nuclear power station fleet.
Hinkley is not the only call on the French giant’s purse. Having said that, it is the biggest.
The Somerset project will soak up 15-20% of all the French company’s cash over the next decade.
“It must be taken before the general assembly of EDF, and it’s important that we give our British partners full visibility of this investment, which is absolutely critical for them… also before the deadlines which are important for them.”
Mr Macron continued: “So we need to make the most of the coming weeks but there is no urgency to decide by the end of the month, because we need to work on a number of measures which are over and above Hinkley Point.”
He was also keen to emphasise that Hinkley Point was not the cause of the short term financial problems of EDF.
The UK government has been criticised for guaranteeing a price of £92.50 per megawatt hour of electricity – more than twice the current cost – for the electricity Hinkley produces for 35 years.
But Mr Macron said that the guaranteed price from the UK government “allows us to guarantee the profitability of the project at around 9% a year for 60 years”.
Mr Macron added: “So beyond the short term financial difficulties it is a good industrial and financial investment for the long term for EDF.”
Earlier this month EDF said it was confident the plant would go ahead despite uncertainties over its funding.
Then, in a letter to staff, the company’s chief executive Jean-Bernard Levy said the project needed to secure more funding from the French government.
He said the financial context was “challenging” and he was negotiating with the French state.
The UK government has said it is “committed” to Hinkley.
This post was written by FSB News