Nuclear Energy in France - Management and Economics

Management and Economics

Électricité de France (EDF) — the country's main electricity generation and distribution company — manages the country's 59 nuclear power plants. EDF is substantially owned by the French Government, with around 85% of EdF shares in government hands . 78.9% of Areva shares are owned by the French public sector company CEA and are therefore in public ownership EdF remains heavily in debt. Its profitability suffered during the recession which began in 2008. It made €3.9 billion in 2009, which fell to €1.02 billion in 2010, with provisions set aside amounting to €2.9 billion. The Nuclear industry has been accused of significant cost overruns and failing to cover the total costs of operation, including waste management and decommissioning.

In 2001, nuclear construction and services company Areva was created by the merger of CEA Industrie, Framatome and Cogema (now Areva NC). Its main shareholder is the French owned company CEA, but the German government also holds, through Siemens, 34% of the shares of Areva's subsidiary, Areva NP, in charge of building the EPR (third-generation nuclear reactor).

EdF said its third-generation nuclear reactor EPR project at its Flamanville, northern France, plant will be delayed until 2016, due to "both structural and economic reasons," which will bring the project's total cost to EUR8.5 billion. Similarly, the cost of the EPR to be built at Olkiluoto, Finland has escalated. Areva and the utility involved "are in bitter dispute over who will bear the cost overruns and there is a real risk now that the utility will default. In contrast, the other reactors at Taishan in Guangdong, China are ahead or on schedule. The estimated completion is expected at 46 months, considerably faster than in France or Finland.

EdF has suggested that if the political environment causes the EPR costs to overrun, the design would be replaced with a cheaper and simpler Franco-Japanese design, the Atmea for which the design will be completed by 2013, or the already operating Franco-Chinese design, the CPR-1000.