EDF reprieves Fessenheim nuclear plant, in setback to government

Reuters News
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Posted: Apr 06, 2017 4:53 PM

By Michel Rose and Bate Felix

PARIS (Reuters) - The board of French state-controlled utility EDF on Thursday chose not to vote on a motion that could have closed its aging Fessenheim nuclear plant for good, meaning a 2012 election pledge by President Francois Hollande will not be met.

Hollande had promised to end power production at France's oldest atomic plant by the end of his five-year term in May.

EDF board members instead authorized its chief executive to seek a decree from the government that would keep Fessenheim open at least until six months before the start-up of a new, third reactor at the company's Flamanville site.

That reactor is still being built and is expected to start production around the end of 2018. That is well into the next president's term, meaning any closure decision could in theory be reversed.

"The decision of the board ... enables EDF ... to have the nuclear fleet necessary to fulfill its obligations to supply its customers," EDF's CEO Jean-Bernard Levy said in a statement.

EDF also said it would only close Fessenheim if keeping it open meant French nuclear output would exceed the legal ceiling of 63.2 gigawatts of power - though Emmanuel Macron, the frontrunner to be France's next president, said he would shut it down if he won.

"Broadly speaking this is a snub to the government in that the closure of Fessenheim is not formally signed and sealed," Laurent Langlard, a CGT union official at EDF, told Reuters.

"In concrete terms, Fessenheim continues to operate ...and we'll see when Flamanville starts producing which unit is disconnected from the grid. But it won't necessarily be Fessenheim."

'OLD AND DANGEROUS'?

Environment Minister Segolene Royal, who has long pushed for Fessenheim to be closed, said in a statement that the shutdown process was inevitable, adding the government would seek legal means in the coming days to endorse the decision.

On Wednesday, she had warned EDF's board against trying to prevent the closure of the plant, on the Franco-German border.

"The government owns more than 80 percent of EDF. A board which does not respect a shareholder which has an extremely large majority, that's unprecedented," Karine Berger, an MP for the ruling Socialist party, said on Twitter.

Macron, tipped to secure the presidency in a runoff vote in May, said on Thursday that Fessenheim would be shut down if he won. "Fessenheim must be closed," the independent centrist candidate said in a television interview.

Environmental groups have long suspected EDF of playing for time, seeking to prevent the closure from becoming irreversible before the end of Hollande's presidency.

"The conditions laid down by EDF are unacceptable," Greenpeace said in a statement.

"In addition to being old and dangerous, Fessenheim's reactor number 2 has been offline for almost a year, since a serious anomaly was detected there. The immediate halt is therefore necessary," Greenpeace said.

Fessenheim's two 900-megawatt reactors each bring EDF about 200 million euros ($213 million) per year in earnings before interest, taxes, depreciation and amortization (EBITDA).

(Additional reporting by Jean-Baptiste Vey; Editing by Adrian Croft and John Stonestreet)