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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