EDF backs nuclear plan but UK delays
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French energy giant EDF on Thursday approved a controversial plan to build Britain's first nuclear power station in decades but the British government said it would wait before taking a final decision.
Britain's Business and Energy Minister Greg Clark said the government would review the nuclear project, shortly after EDF's board backed a project which critics fear could bankrupt the French utility.
"The UK needs a reliable and secure energy supply and the government believes that nuclear energy is an important part of the mix," Clark said.
"The government will now consider carefully all the component parts of this project and make its decision in the early autumn," he said.
Before the deal can go ahead it must be approved by Prime Minister Theresa May.
EDF's directors divided
EDF's directors had been deeply divided over the planned construction of two nuclear reactors at Hinkley Point in southwest England for 21.4 billion euros.
"At its meeting on 28 July 2016, EDF's board of directors made the final investment decision," the company said in a statement. Ten members of the board voted in favour of the deal, while seven voted against.
Gérard Magnin, a member of French energy giant EDF's management board resigned on Thursday just before the meeting, saying he disagreed with the plan. He added that he could no longer support France's strategy to push nuclear energy at the expense of other options.
Reactors due to go online from 2025
The Sizewell B nuclear power plant was the last to go online in Britain, starting generation in 1995.
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.
A debt of 37.4 billion euros
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 Flamanville in France and the other in Finland, and both have been plagued by delays and cost overruns.