EDF May Let Talks for New U.K. Nuclear Plant Fail

Electricite de France SA, which is negotiating to build the U.K.’s first new nuclear power plants in almost two decades, is preparing to allow the talks to fail because of a dispute over the price of electricity.

Chief Executive Officer Henri Proglio said the French utility isn’t “in a hurry” to agree with the government the so-called strike price it will receive for power produced at the planned plant at Hinkley Point in southwest England.

“We have precise conditions in mind, and we are negotiating with the British,” Proglio told reporters today in Paris. “For me negotiations can fail.”

U.K. lawmakers have warned that failure to build new nuclear plants will jeopardize the country’s chances of meeting its legally binding obligations to slash greenhouse gases. The former chief scientific adviser to the government, David King, said last year that a better nuclear strategy is needed, or “the risk of the lights going off is very serious.”

EDF is seeking a strike price of at least 95 pounds ($145) a megawatt-hour for the power it produces from Hinkley, and is trying to lock in the rate for 40 years. The government says it’s trying to make sure consumers get the best value for money from any deal.

EDF intends to build two reactors made by Areva SA (AREVA) at Hinkley Point, about 150 miles (240 km) west of London on the southern edge of the Bristol Channel. The units would have a total capacity of 3,260 megawatts, enough to supply 5 million homes for 60 years.

The Paris-based company already owns eight nuclear stations totalling almost 9 gigawatts in the U.K., though only its 1.2- gigawatt Sizewell B is scheduled to stay open past 2023.

To contact the reporters on this story: Tara Patel in Paris at tpatel2@bloomberg.net; Alex Morales in London at amorales2@bloomberg.net

To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net

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