EDF may get state loan for six new reactors
France's Nuclear Policy Council - headed by President Emmanuel Macron - has agreed that a subsidised government loan should be issued to state-owned power utility EDF to cover at least half the construction costs of six EPR2 reactors.
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In February 2022, Macron announced that the time was right for a nuclear renaissance in France, saying the operation of all existing reactors should be extended without compromising safety and unveiling a proposed programme for six new EPR2 reactors, with an option for a further eight EPR2 reactors to follow. The first three pairs of EPR2 reactors are proposed to be built, in order, at the Penly, Gravelines and Bugey sites. Construction is expected to start in 2027. The cost was originally estimated at EUR51.7 billion (USD56.4 billion), but this was revised to EUR67.4 billion in 2023.
The EPR2 reactor is a pressurised water reactor project developed by EDF and Framatome. It meets the general safety objectives of the third generation of reactors. Its aim is to incorporate design, construction and commissioning experience feedback from the EPR reactor, as well as operating experience from the nuclear reactors currently in service.
At a 17 March meeting, the Nuclear Policy Council (CPN) "examined the main principles of the financing and regulatory framework" for the construction of the six EPR2s, the Elysee Palace (the official residence of the French president) said in a statement. "This framework is based on a subsidised government loan covering at least half of the construction costs and a Contract for Difference on nuclear production at a maximum price of EUR100 (USD109) per MWh in 2024 value."
A Contract for Difference is essentially where there is a future fixed price guaranteed for electricity generated, with the government either paying the difference between the market price and the agreed sale price, or receiving payment if the market price is higher.
Elysee said: "This important milestone will allow discussions between the government and EDF to be finalised in the coming weeks and allow for rapid initiation of discussions with the European Commission, with a view to EDF making a final investment decision in 2026."
The Council requested EDF "step up its cost and schedule control efforts" and to present a binding cost and timeframe estimate by the end of the year.
The CPN also validated the action plan aimed at securing the upstream part of the nuclear fuel cycle and "in particular the support that the State will provide to Orano for France's uranium supply in the medium and long term".
Regarding used fuel processing, the Council confirmed continued investment in Orano's programme of upgrades in downstream activities at its La Hague site. This programme includes the storage of used fuel in a new pool installed at La Hague, which should be commissioned by 2040 to meet the needs of the existing nuclear fleet and then the EPR2 reactors.
"These facilities will ensure the proper operation of the fleet, as well as the continued reprocessing of fuel under the best economic and safety conditions, reinforcing France's leadership in controlling all industrial stages of the uranium cycle," Elysee said. "The Council also approved the principle of funding this programme primarily led by EDF, as a future customer of these facilities, and of governance led by Orano, involving EDF, the French Alternative Energies and Atomic Energy Commission (CEA), and government services."
The CPN requested that industry (EDF, Framatome, Orano), the CEA, and all stakeholders involved in fast neutrons submit to the government a work programme and a proposal for industrial organisation by the end of 2025.
In addition, the Council mandated the General Secretariat for Investment to continue supporting the development of small modular reactors by "prioritising the projects most likely to lead to the commissioning of a demonstrator at the beginning of the 2030s". The CPN also asked the CEA to make the relevant site data from Marcoule and Cadarache available to companies that request it and to initiate discussions with a view to establishing the most advanced projects on these sites.
Set up by former President Nicolas Sarkozy in 2008, the CPN is a top-level ministerial council on nuclear energy policy. The council sets main policy features as well as their implementation in terms of export, international cooperation, industrial policy, energy policy, research, safety, security and environmental protection.
