In less than 4 years, important measures have been put in place to revive nuclear power
In addition to the nationalization of EDF since June 8, 2023, the reform of the European electricity market and the future regulation of electricity prices was adopted by the European Parliament in April 2024. Various legislative and strategic tools have been designed or are currently being designed or updated: law of June 22, 2023 on nuclear acceleration, law of April 11, 2024 aimed at protecting the EDF group from a dismemberment, draft French Strategy for energy and climate which includes the projects of the third Multi-annual Energy Program subject to consultation on November 4, 2024 as well as the National Low Carbon Strategy. At the same time, nuclear governance was reformed: reactivation of the nuclear policy council in 2023, creation of the interministerial delegation for new nuclear power in 2022 to ensure State supervision of the industrial program for the construction of new nuclear power reactors, strengthening of the Grouping of French nuclear energy industrialists, merger of the Nuclear Safety Authority and the Institute for Radiation Protection and Nuclear Safety in 2024.
Feedback which highlights a systematic drift in schedules and costs
As recommended by the Court, the use of feedback and risk analysis has been developed. In addition to the excesses at the Flamanville 3 construction site, the EPR reactors in operation in China (Taishan 1 and 2) and in Finland (Olkiluoto 3) have experienced technical malfunctions in recent years, with significant financial impacts whose consequences have been damaging to the credibility of the EPR 2 program. In Great Britain, on the Hinkley Point site, EDF is faced with a sharp increase in costs accompanied by a new delay of two years, as well as than a heavy additional financing constraint caused by the withdrawal of the Chinese co-shareholder. Regarding the new EPR project at Sizewell, delays are already accumulating, with initial negative consequences in organizational and financial terms. The Court recommends not approving a final investment decision in this project before obtaining a significant reduction in EDF's financial exposure in the Hinkley Point site. The Court further recommends ensuring that any new international project in the nuclear field generates quantified gains and does not delay the timetable of the EPR 2 program in France.
The industrial sector has started to organize itself to implement the strategy announced in 2022
-The structuring of the nuclear sector within the EDF group, illustrated in particular by its two subsidiaries Framatome and Arabelle Solutions, is essential to meet the challenges of the EPR 2 program. Although it is too recent to assess its implementation, the reorganization internal EDF has been effective since April 2024. It is based on a clarification of responsibilities between project management (MOA) and project management (MOE) on the one hand and between the MOE and engineering but also the supply chain on the other hand, as previously recommended by the Court. As for the performance incentives recommended in 2020 by the Court, they are being implemented in the EDF group's contractual strategy. The mobilization of GIFEN and the creation of the nuclear professions university contribute to this dynamic of support for the new nuclear program, which will require the recruitment of 100,000 additional jobs by 2033.
The nuclear industrial sector, however, remains exposed to persistent risks
The EPR 2 program is marked by a design delay, an absence of a completed estimate and a financing plan while EDF remains very heavily in debt. As the financing conditions for this program have still not been finalized, the profitability of the EPR 2 program remains unknown to this day. These delays and uncertainties, which also relate to the number of power plants to be built, imperfectly meet the expectations of stakeholders in the sector and reduce the visibility they need to engage in industrial projects of this magnitude. Although evolving, EDF's contractual strategy does not yet guarantee the accountability of service providers in the sector who still consider it too unbalanced and express significant reservations given the maturity of the EPR 2 program.
The additional construction costs, delays and uncertainties are numerous and require responses from EDF, public authorities and the sector to ensure the success of the EPR 2 program.
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