Le Pen Would Seek to Pull EDF Out of U.K.’s Hinkley Project

  • If elected French president, Le Pen to look for exit clauses
  • She sees U.K. project diverting EDF resources away from France

The concrete batching plant stands on the horizon as work recommences at the Hinkley Point C nuclear power station, operated by Electricite de France SA's (EDF), near Bridgwater, U.K., on Friday, Sept. 16, 2016.

Photographer: Luke MacGregor/Bloomberg

National Front leader Marine Le Pen would look for ways to pull Electricite de France SA out of its 18 billion-pound ($22.3 billion) Hinkley Point nuclear contract in the U.K. if she’s elected France’s president, one of her aides said.

“We will respect the commitment of the French state, but if clauses in the contract allow an exit from this project we will study them,” Philippe Murer, Le Pen’s adviser on energy and environmental matters, said in an interview Friday.

The National Front “was fundamentally against the project,” which is diverting the state-controlled utility’s resources at a time when it needs to increase spending to support the struggling nuclear industry at home, extend the lifetime of its aging domestic atomic plants and complete a new reactor at Flamanville in western France, he said.

While Le Pen is a distant second in opinion polls to favorite Emmanuel Macron for the May 7 presidential runoff, Murer’s comments may revive the controversy over the British project on which EDF has already spent several billion pounds in studies and preparatory works. The company’s chief financial officer resigned in March 2016, seven months before the signing of the Hinkley Point contract, saying that the project would take almost 10 years to build and strain the company’s finances.

Macron, France’s economy minister at the time, and EDF Chief Executive Officer Jean-Bernard Levy defended the project, saying it’s key for EDF and France’s nuclear industry. In September, the CEO signed the contract under which the U.K. government guaranteed that the Hinkley plant will be able to sell electricity at more than double current prices for 35 years.

Following a last-minute review of the agreement, in which China General Nuclear Power Corp. took a 33.5 percent stake, the U.K. added a clause that states EDF won’t be able to sell down its controlling stake prior to completion of construction without the British government’s approval. The Hinkley power station is due to provide 7 percent of the U.K.’s electricity needs for 60 years, according to the government and EDF.

Macron Stance

A close adviser to Macron, who spoke on condition of anonymity, said the Hinkley project wouldn’t be jeopardized by his election. Still, the adviser cautioned that Macron quit the government last August and said the candidate and his team don’t have all the latest information on the industry, suggesting he may want to review the situation as he studies the state of the French nuclear sector.

An EDF spokeswoman declined to comment on remarks about the Hinkley project by the campaigns of the presidential candidates.

The sector has been weakened by recent investigations showing manufacturing issues at Areva SA, a key supplier of nuclear equipment, including for Hinkley Point. EDF has agreed to buy a controlling stake in Areva’s struggling atomic-reactor business, provided that a review shows the company’s manufacturing woes are under control.

EDF is itself suffering from falling power prices, forcing it to slash jobs and other costs, and sell 10 billion euros of assets by 2020 to fund new projects including Hinkley. It also sold 4 billion euros of new shares last month, including 3 billion euros to the French government, which owns 83 percent of the company.

An adviser to Republican candidate Francois Fillon, who also didn’t want to be identified, said it would be extremely complicated for EDF to exit Hinkley Point, which must be seen as a cornerstone of Europe’s power supply security regardless of Britain’s plan to leave the European Union.

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