EDF: New delay and new additional cost for the Hinkley Point EPRs

PARIS (Reuters) – Construction of the two EPR nuclear reactors at Britain’s Hinkley Point power plant will be delayed by more than a year and its overall cost will increase by three billion pounds sterling (3.54 billion euros). ) additional to reach 25 to 26 billion, announced Thursday evening EDF, the operator of the project.

The French group had already modified the timetable and reassessed the invoice for this file in January 2021 by announcing a six-month postponement of commissioning and an additional cost of 500 million pounds, to 22-23 billion.

“The start of the electricity production of unit 1 is now planned for June 2027”, he explains now, specifying that “the risk of postponing the delivery of the two units is evaluated at 15 months, assuming the absence of a new pandemic wave and the additional effect of the war in Ukraine”.

EDF justifies this new delay by the fact that “people, resources and the supply chain have been strained and their effectiveness has been limited” since the start of the COVID-19 pandemic two years ago.

“In addition, the volume of studies and civil engineering works, and the cost of these works and in particular of maritime works, have increased”, he adds.

The group controlled by the French State ensures that in accordance with the contract signed with London, the new additional cost of the Hinkley Point site will have no consequence on the bill of British consumers.

The next key stage of the project is the installation of the concrete dome of EPR number one, scheduled for the second quarter of next year.

On the Paris Stock Exchange, the EDF share gained 1.98% to 8.46 euros around 10:15 a.m. while the CAC 40 index rose by 0.73%.

Jefferies estimates in a note that the new announcements imply a depreciation of 0.85 euro of EDF shares but that “the risks had been signaled by EDF during the presentation of the results of the first quarter and were therefore probably anticipated”.

Same analysis for JPMorgan, which believes that the delay and the additional cost “are not a surprise for the market because the project was not immune to the COVID-19 crisis and its repercussions on global supply chains”.

EDF’s stock price had also lost 3.58% over the two previous sessions after a further downward revision of the group’s nuclear electricity production forecasts, a consequence of corrosion defects affecting certain reactors, a file whose financial impact has been revised upwards.

(Report Jean Terzian, Forrest Crellin and Marc Angrand)

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