Hinkley Point C nuclear project in crisis as EDF finance director resigns
The £18bn Hinkley Point C nuclear project was in crisis on Sunday night after reports that the finance director of EDF, the company behind the scheme, had resigned.
Thomas Piquemal has stood down from his post after expressing trenchant opposition to those on the EDF board who want to give the green light to the project within weeks, sources said.
The resignation of such an important figure on the EDF board will make it much harder for the remaining executives to proceed with Hinkley in the short term.
A new plant at Hinkley, in Somerset, is desperately needed and has been heavily promoted by the chancellor, George Osborne, and other ministers as a key part of keeping the lights on in Britain.
But EDF has been hit by a series of problems that have led many – even in the City of London – to conclude that the new nuclear plant project is on the verge of collapse.
Piquemal is said to have been arguing that pursuing what would be the world’s most expensive power project at this moment could jeopardise the French group, which already has rising debts.
Union members on the EDF board are also implacably opposed to Hinkley Point, saying it is too expensive and a risk to the energy company’s future.
Piquemal’s resignation was reported by sources at Reuters and Bloomberg news agencies but EDF declined to confirm or deny the departure.
Senior industry sources quoted by the agencies said earlier in the weekend that EDF was determined to proceed with the scheme within weeks even though the French government – the majority share owner – had serious doubts about EDF’s finances.
EDF admitted recently it was going to have to sell a range of assets to raise cash. Piquemal is believed to be concerned that the chief executive, Jean-Bernard Lévy, wants to proceed with Hinkley before those sales have been completed.
As well as huge debts, EDF is grappling with a collapse in power prices, huge cost overruns on another nuclear project in France and a need to spend tens of billions of euros upgrading its domestic reactors.
The French government has also put pressure on EDF to take over Areva, a cash-strapped state-owned French nuclear engineering company.
Two reactors of the EPR (European Pressurised Reactor) type to be built at Hinkley are under construction in France and Finland but are years behind schedule and billions of euros over budget. Two more in China have also suffered delays.
EDF – which is 85% state-owned – has borrowed billions just to pay dividends to its state shareholder in recent years and its earnings are under pressure from record low wholesale electricity prices.
It needs to spend €55bn (£43bn) to upgrade its ageing French nuclear plants, €5bnon a smart meter rollout and several billion euros to take over and restructure the reactor unit of Areva.
Lévy said last month he expected the company would take a final investment decision on Hinkley Point nuclear plant “this year”, after having said several times in recent months that the decision would be taken “soon”.
Lévy also said he expected EDF would pour its first concrete for Hinkley Point in 2019 and that any potential exit of Britain from the European Union would not change the plan.
The project was first announced in October 2013 and EDF announced a partnership for it with Chinese utility CGN in October 2015. An investment decision has been delayed several times.