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French Nuclear Dismantling Funds May Fall Short, Report Says

Electricite de France SA and Areva SA (AREVA), along with other French nuclear operators, may not be setting aside enough funds to pay for future dismantling of reactors and treatment and storage of atomic waste, according to a parliamentary report.

Cost estimates by atomic operators don’t have a “safety margin and risk being raised in the future,” according to a report published today by a national panel charged with evaluating the financial costs of atomic decommissioning. Current estimates carry “large margins of uncertainty.”

Under French law, nuclear operators including EDF and Areva have to build portfolios or amass funds to pay for the decommissioning of reactors and radioactive waste storage. The cost estimates vary, including for planned development of France’s underground atomic waste site. That is estimated at between 14.4 billion euros ($17.4 billion) and 35 billion euros, the report said.

The costs that needed to be covered at the end of last year reached 34.8 billion euros, for which operators have made provisions of 31.6 billion euros, the report said. Total costs of dismantling and treating atomic waste were estimated at 92 billion euros.

“What is not tolerable is that the funds are managed by the operators,” French Socialist deputy Christian Bataille said today. “They should be under state control because they are there to manage nuclear waste for the whole French population. Over the past six years there has been a veritable veil pulled over this subject.”

EDF was supposed to have set aside enough money by the end of June 2011 for decommissioning all of its nuclear assets and waste storage. A power law gave the utility a five-year extension on the deadline to 2016. The Commissariat a l’Energie Atomique, another operator of nuclear sites, uses state backing as its provisions, the report said.

To contact the reporter on this story: Tara Patel in Paris at tpatel2@bloomberg.net

To contact the editor responsible for this story: Will Kennedy at wkennedy3@bloomberg.net

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