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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 giant 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.
The call for the projects to be treated together comes as EDF faces the difficult prospect of shouldering the extra financing needs for Hinkley Point alone, after Chinese investor China General Nuclear Power Corp declined to inject more capital in the project in 2023.
CGN’s decision came after the UK government bought it out of Sizewell over national security concerns.
EDF’s outgoing chief executive Luc Rémont said in February that the business had “lots of interesting discussions” but had not yet reached agreements to bring in another investor. One person familiar with discussions said EDF was struggling to find appropriate partners on attractive terms.
The French energy group is also in a state of flux following the decision by the French government last month to replace Rémont with Bernard Fontana, head of EDF’s engineering arm Framatome.
Fontana is expected to be confirmed in his role at the company’s annual general meeting on 4 May, after hearings before the French parliament and Senate.
The person familiar with the business said that large strategic decisions had been “put on standby” since the announcement, including on Hinkley Point and Sizewell C.
Ferracci said he expected decisions to accelerate once Fontana was confirmed in post: “[He] knows very well the whole value chain of nuclear. Things will go very quickly as soon as he is appointed.”
