The chief executive of EDF said he wants to reach a final decision soon on investing in Britain’s Hinkley Point nuclear power plant after the resignation of his finance director cast further doubt on the French energy company’s ability to fund the £18bn project.
Jean-Bernard Levy said he regretted the “hastiness” of Thomas Piquemal’s departure as finance chief. Piquemal resigned because he believed pursuing the world’s most expensive nuclear project could threaten the group, whose finances are already stretched by rising debt.
Piquemal’s departure increased the feeling of crisis surrounding the Hinkley project, which is seen as vital for Britain to keep the lights on. If the plan were to collapse, it would be a serious blow to the UK government, which has offered generous guarantees to build two reactors at the site in Somerset.
EDF’s battered share price fell 6.5% on Monday after Piquemal’s resignation was revealed over the weekend. The company’s shares have more than halved from €22 to €10 in the past year as concerns have mounted about its finances.
In a deal supported strongly by the chancellor, George Osborne, EDF joined forces with the Chinese utility CGN in October to construct the reactors. But many industry figures now believe the project is on the verge of collapse.
EDF, which is 85% owned by the French government, said in October it expected to take a final decision and start deploying engineers at Hinkley Point in November. But the company has still not signed a final contract as fears have mounted about its financial strength.
In an emailed statement, Levy said: “With the support of its state shareholder, EDF confirms it is studying the investment in the two Hinkley Point reactors in the best financial conditions for the group, with the aim of announcing a final investment decision soon,” Reuters reported.
On top of its large debts, EDF is grappling with a collapse in power prices, cost overruns on a nuclear project in France and upgrades costing tens of billions of euros on its domestic reactors. Piquemal’s resignation raises grave doubts about EDF’s ability to carry out the project, which the UK government is relying on to meet the country’s energy needs.
Levy said last month a decision on Hinkley Point was “coming closer” as EDF reported a 68% plunge in annual profit and cut its dividend. The company said its net debt had increased by €3.2bn (£2.5bn) to €37.4bn.
This article was written by Sean Farrell, for theguardian.com on Monday 7th March 2016 10.19 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010