French state-controlled power group Electricite de France SA's (EDF.FR) tariffs must enable it to invest in France's 58 reactors, and France can benefit from the company's experience to boost the whole French nuclear industry's export capacity, Chairman and Chief Executive Henri Proglio said Monday.
French state-controlled power group Electricite de France SA's (EDF.FR)
tariffs must enable it to invest in France's 58 reactors, and France can benefit
from the company's experience to boost the whole French nuclear industry's
export capacity, Chairman and Chief Executive Henri Proglio said Monday.
EDF can't afford to sell part of its electricity to its competitors below its
cost price because it needs to invest between EUR30 billion and EUR40 billion
to improve the performance of the country's 58 nuclear reactors and extend
their lifespan, Proglio said during a show on French television LCI. "No
company could accept it", Proglio said.
Under the Loi NOME--a law to reform French electricity markets, which was
passed in December--EDF is obliged to sell up to 100 terawatt hours a year of
its nuclear production to its rivals to encourage competition.
French industry and energy minister Eric Besson, also on the show, declined to
say whether Proglio was right to assume that the price imposed on EDF should be
set at EUR42/MWh to start with.
"A commission has been asked to look into an estimation of EDF's historic
cost price for nuclear electricity. No decision shall be taken till it reports
its conclusions," Besson said.
Proglio claimed that EDF's reputation, know-how and experience could benefit
the entire French nuclear industry. "It is normal another country should
wish to benefit from EDF's experience. Not playing one's best card is not the
best way to win," Proglio said, referring to a major setback the French
nuclear industry suffered in December 2009 when a French consortium led by
state-controlled nuclear-engineering firm Areva SA (CEI.FR, ARVCY) and utility
GDF Suez SA (GSZ.FR) failed to win a key $20 billion contract in Abu Dhabi
after EDF declined to participate.
Another reason for
France
's
losing the
Abu Dhabi
bid
was that it offered a sophisticated and expensive product, said Besson. For this
reason, it is necessary to develop powerful reactors, such as Areva's EPR, as
well as medium ones, such as the projects on which EDF and its Chinese partner,
or Areva and
Japan
's
Mitsubishi Heavy Industries Ltd. (7011.TO), are working, Besson said.
There is no competition between these different projects; several reactors are
necessary to win markets abroad, Proglio said.
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