French energy giant EDF will extend the life of four of its eight UK nuclear power plants – safeguarding 3,000 jobs in the process.
Heysham 1 and Hartlepool will continue to generate power for additional five years – up until 2024, while Heysham 2 and Torness will see their life extended by seven years to 2030.
The protected jobs comprise 2,000 full time employees together with 1,000 contractors.
In October EDF and China General Nuclear Power Corporation (CGN) signed a strategic investment agreement for joint investment in the construction of two EPR (European Pressurized Reactor) nuclear reactors at Hinkley Point C in Somerset.
However since this questions regarding the feasibility of the project have arisen.
A final investment decision was expected to have already been taken.
EDF chairman Jean Bernard Levy told a news conference in Paris today: “We intend to proceed quickly with the final investment decision on Hinkley Point but there is a little work to complete, particularly because we could not finalise the discussions with our Chinese partners before their own break, before the Chinese New Year.
“There is still a little work to complete but, today, we believe that the final investment decision is very close.”
Despite that they’re not likely to be live until at least 2025 the Hinkley reactors are forecast to provide 7% if the UK electricity requirements which means the UK’s energy security would be called into question should the project be delayed or even scrapped.
Newport MP Paul Flynn tweeted “All EPR reactors are late and billions over budget, EDF is in crisis. Time to abandon Hinkley farce, unworkable as subsidy bill soars”.
Given that have EDF already spent more than £1bn preparing the site in Somerset on which Hinkley C may be built any decision to abort would be an expensive one.
The company’s share price has fallen 56% in the 12 last months – meaning that – somewhat perversely – the cost of Hinkley (€30bn) is 50% bigger than the company’s market value.
EDF are financing two thirds of the Hinkley project with the Chinese stumping up the rest of the cash.
EDF had initially wanted to own less than 50% of the plant so that the investment could be recognised off balance sheet but it was forced to increase its stake following the crisis at it’s rival firm Areva. The will in due course consider bringing other investors into the project.
Today’s announcement comes alongside the Paris-based firm’s annual results which show that its losses for 2015 have worsened by 1.5% to £2bn.
Meanwhile the company’s UK arm, EDF energy, has seen underlying operating profit slip 15% to £664m which the firm attributes to the ongoing cost of its investment programme.