Nuclear Blackmail: EDF Demands Govt Guarantees Profits
EDF, the French nuclear power group, has reined in capital spending and launched a €1bn cost-cutting programme as it warned again that it would only build new atomic power stations in the UK if profits were guaranteed.
The company’s net debt has soared over the past year from €33.3bn at the end of 2011 to €39.2bn in December, putting extra pressure on its management to keep investments under control.
EDF – the world’s biggest supplier of nuclear-powered electricity by production – was planning to increase capital spending to €13bn this year. But it said on Thursday that 2013 spending would be kept flat at €12bn, while plans to increase capital outlay to €14bn in 2014 and €15bn in 2015 were under review.
With most of that spending allocated to maintaining and supporting EDF’s fleet of 58 nuclear reactors in France, analysts have said that this leaves less money for international investments such as the UK.
Henri Proglio, EDF’s chief executive, said negotiations with the British government over the multibillion-pound nuclear power station at Hinkley Point in Somerset were “intense”. But he added that “we expect to come to a conclusion by the end of the first quarter” in talks aimed at setting a fixed price for power generated by the plant.
“We will not move on without a formal guarantee on the profitability of our investments,” he added.