The board of French energy giant EDF is scheduled to meet on Thursday. Among the items on their agenda will be whether or not to give the nuclear project in Somerset the green light.
“It’s taken so long; it’s a bit of a toss of a coin,” said utilities analyst Angelos Anastasiou. “My guess is they’ll say yes but it could quite easily be no. It could go either way.”
The strike price agreed between EDF and the Department of Energy and Climate Change is “reasonably generous” but there are “quite big risks in terms of cost overruns and so on”. “Between EDF and Areva, their financial positions aren’t the strongest,” he added.
However, with EDF being majority owned by the French state, it will be as much a political decision as a financial one: “It is really what the government will be pressing for because they’re the ones that are actually taking on the project.”
Although French economy minister Emmanuel Macron has repeatedly made assurances since the beginning of the year that his government is fully committed to the project, Anastasiou said there have been a “mix of opinions” within the administration.
He continued: “The UK government in its current guise is still saying the same things ; that it’s full speed ahead. On the other hand, there has been for a while a bit of dissent particularly about the price.”
Although the vote to leave the European Union has not changed the calculation being made, “what it does give is the potential for all parties, if they want, to part blame a decision to pull out on Brexit.”
Announcing the meeting, EDF said the plant is a “major element” of the company’s overall strategy: “HPC would also enable the group to mobilise all its significant nuclear engineering skills following the final investment decision.
“The first concrete of reactor 1 of HPC, scheduled for mid-2019, would coincide with perfect continuity with the start-up of the EPR at Flamanville, scheduled for the end of 2018,” it added.
EDF has already spent a considerable amount of money preparing the site for construction, and has given every indication the project will be given the go ahead soon. Shortly before last month’s EU referendum, chief executive of EDF Energy Vincent de Rivaz said there was an “absolute need” for Hinkley regardless of which way the vote went.
Appearing before the Energy and Climate Change Committee in May he said the “money is there” to build the plant and it shouldn’t be delayed by several years as some French unions had suggested: “There is no need for delay because the project is ready.” De Rivaz said the decision was being held up by a consultation with workers via the company’s Central Works Council, which eventually concluded on 4 July.
At a meeting of the council, representatives from three of the four unions with seats on EDF’s board supported a resolution stating that they are “not in a position to give their opinion about the project”. Representatives from the fourth abstained from voting.
The council was previously reported to have taken legal action to get the consultation extended on the basis that EDF did not provide it with sufficient information to come to a conclusion. The company said last week: “This project has been the subject since 2013 of a significant sharing of information with employees and their representatives, illustrating the commitment of the company to quality social dialogue.”
One of the major concerns of the French unions has been the EPR technology which is planned for Hinkley. As of yet there are no working examples and several of those which are currently being built are over budget and behind schedule.
France’s Nuclear Safety Authority is currently conducting tests on the reactor vessel at Flamanville 3 in Normandy after finding a manufacturing “anomaly”. The Taishan 1 reactor in China has also been said to suffer “identical flaws”.
On Thursday French investigators from the Financial Markets Authority reportedly raided EDF’s headquarters in Paris as they looked into the company’s disclosure of information to the market. The Telegraph reported that they were partly concerned with the plans for Hinkley.