Power prices fall as fears ease over French nuclear output
Wholesale power prices for the first three months of 2017 have plunged in response easing fears over reduced nuclear output in France.
The French nuclear regulator ASN has agreed in principle to allow EDF to return a number of its reactors to service once safety inspections have been completed.
Wholesale prices for the first quarter of the year plummeted by more than £5/MWh to £48.60/MWh on Tuesday in the wake of the announcement. Price reporting firm ICIS said it was the biggest daily decrease it had ever witnessed for the period. The fall was even greater on the French market where the price dropped by more than €12/MWh to around €54/MWh.
Supply margins in France were expected to be historically tight this winter due to safety inspections being carried out on 12 of EDF’s reactors. The company has been forced to remove the reactors from service and extend refuelling at other nuclear plants to carry out the tests.
EDF has twice cut is projections for nuclear output to reflect this, sending French wholesale prices rocketing. There has been a knock-on effect on prices in Britain as the UK typically imports power from France via a 2GW interconnector during periods of peak demand.
The tests were ordered by ASN in June to establish to what extent the reactors suffer from a similar “manufacturing anomaly” to one discovered by EDF at its Flamanville 3 reactor being built in Normandy.
In October, ASN revealed that the inspections had been undertaken or were ongoing at seven of the reactors. It ordered EDF to carry out tests on the remaining five reactors over the following three months without waiting to conduct them during planned maintenance for refuelling.
ASN has now approved EDF’s “generic demonstrations” showing how the ten 900MW reactors can be operated safely. The regulator said EDF should be therefore able to restart the reactors once additional safety measures have been put in place, the inspections have all been completed and the reactors have been approved on an individual basis. EDF is expected to send ASN further demonstrations “shortly” showing how the two 1,450MW reactors can also be returned service.
The announcement eased concerns of tight supplies in France, leading to falling wholesale prices both there and here in the UK. Seven of the 12 reactors in question are currently offline, according to the website of French grid operator RTE. The safety inspections are yet to start at those which are currently online, ASN told Utility Week.
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