EDF’s Credibility Hangs on Hinkley Point, U.K. Minister Says

  • Plant may be ‘scuppered’ by Austrian challenge, Leadsom says
  • U.K. waiting for EDF’s final decision on whether to invest

Electricite de France SA may lose its credibility as one of the world’s top nuclear-power developers if it fails to build two new reactors on England’s southwest coast, a U.K. energy minister said.

EDF has delayed until September its final investment decision on Hinkley Point C, the world’s most expensive power station, marking a setback for a project that was originally due to be completed in 2017. The latest date for commissioning is 2025, at which point it may provide 7 percent of the country’s power.

“A huge amount of EDF’s credibility as a nuclear developer will rely on this deal getting done,” Andrea Leadsom, a junior minister at the Department of Energy and Climate Change, told reporters at an event in London on Tuesday where she was campaigning for the U.K. to leave the European Union.

The U.K. will have to “fight quite hard” to ensure the 24.5 billion pound ($35.5 billion) power plant isn’t blocked by a legal challenge from Austria, which objects to the U.K. government’s proposed subsidies for Hinkley, she said. “Being a member of the EU could scupper the deal because of the state aid challenge from Austria.”

Leadsom’s comments are in line with those of EDF Chief Executive Officer Jean-Bernard Levy, who said last week that the Hinkley Point investment is “indispensable.” Without the project, “we wouldn’t have any more credibility to access the market” for new atomic plants, he told shareholders.

Energy Security

The U.K.’s energy security could be improved if voters choose to leave the EU in a referendum set for June 23, Leadsom said in a speech at the offices of the Vote Leave campaign. European Commission proposals could force member states to take responsibility for each other’s natural gas supplies, a scenario which Leadsom said would be unfair for British businesses.

“We have gone to great lengths to ensure our own energy security, and we should not be putting it at risk if others haven’t done so,” she said, adding that she also disagrees with plans to require countries to gain the commission’s approval for new gas deals with international partners.

Leadsom’s stance on the U.K.’s membership in the EU of the put her at odds with her boss, Energy and Climate Change Secretary Amber Rudd, who said in March that a U.K. vote to leave the EU might force up energy bills by 500 million pounds a year and threaten energy security.

“We’re great friends, and I have huge respect for her, and on this issue we have agreed to disagree,” Leadsom said “I don’t think it will harm our relationship and it certainly isn’t harming our working together in the department.”

The U.K. government is campaigning to remain in the EU. A spokesman for the Department of Energy and Climate Change declined to comment on Leadsom’s speech on the grounds it’s a political issue.

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