EDF’s new UK plants should be negotiated as one, French energy minister says
French group has been concerned about shouldering cost overruns of Hinkley Point and Sizewell nuclear projects
EDF’s two UK nuclear construction projects at Hinkley Point and Sizewell should be negotiated as a single financial venture, France’s energy minister has urged, to prevent the French energy group shouldering significant cost overruns.
Marc Ferracci said he had held discussions on the projects with Britain’s energy minister Ed Miliband on Thursday, on the sidelines of an energy security summit in London.
“France and EDF are very committed to deliver the projects but we have to find a way to accelerate them and we have to find a way to consolidate the financial schemes of both projects,” Ferracci told the FT.
France has been lobbying the UK government to help EDF with the finances of Hinkley Point C in Somerset for more than a year. It argues that the French state-owned electricity operator should not be left on the hook for cost overruns that have taken the total bill to as high as £46bn.
EDF — which has also experienced long delays on other projects using the same reactor technology in Finland and France — has warned that the first of two reactors at Hinkley Point C could be delayed to as late as 2031, which would be six years later than its original target.
The French company has a smaller equity stake in the Sizewell C project in Suffolk, which it is also developing.
Ferracci denied that the French government was seeking to use Sizewell as “leverage” to help bail it out of financial difficulties at Hinkley.
“It is not a discussion about leverage, it is a discussion between friends and allies,” he said. “We need to stick together on many subjects — on Ukraine, on all dimensions of our relationship. So there is a way through and I hope we will be able to find it in the next few months.”
Ministers are hoping to greenlight the Sizewell nuclear plant after a government spending review due to be completed in June. France has argued for a “global solution” that would result in a deal cut across both projects to help smooth EDF’s overall returns.
“It is a good approach to have a global approach to our relationship,” said Ferracci. He added that more “grid connections between France and the UK” could also form part of the broader negotiations.
EDF declined to comment.