France's EDF Faces Crunch Vote On British Nuclear Plan

PARIS,(APP - UrduPoint / Pakistan Point News - 28th july,2016) : The board of energy giant EDF is to vote Thursday on a hugely controversial project to build a nuclear power station in Britain which critics say could bankrupt the French utility. EDF's directors are deeply divided over the planned construction of two nuclear reactors at Hinkley Point for #18 billion (21.4 billion euros, $23.8 billion), with the French government's board representatives strongly in favour, unions strongly against and independent directors expected to tip the balance. The plan to build the EPR latest generation reactors signed in 2013 is to be carried out by EDF with Chinese partner CGN, but has hit several snags since. 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 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.

The French government said this week it would foot three billion euros of a four-billion capital increase by EDF, but unions still fear for EDF's financial survival and have asked for a delay of at least three years to any decision, even waging a court battle to stop the momentum. The Hinkley Point project in Britain is one of the world's most costly nuclear power plant projects. "The situation in the company is extremely tense, and the chairman is more than ever isolated from his top managers and from unions," said one union source. EDF chief financial officer Thomas Piquemal resigned over the threat the project represents to the company's finances, and chairman Jean-Bernard Levy 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.