Investments in France’s EDF could top €20bn per year, minister says

The state-owned utility is facing a mountain of investment needs to maintain its nuclear fleet as well as build new reactors and renewable power production. EDF CEO Luc Rémont had previously put the investments at €25 billion.

“What we are talking about … for EDF is investments which could reach … more than €20 billion per year,” Pannier-Runacher said at a nuclear conference organised by the Organisation for Economic Co-operation and Development (OECD).

“There is a discussion about whether it is 20 (billion) or whether it is more,” she added.

The French government has previously announced a plan to build at least six new model nuclear reactors, which Pannier-Runacher said would cost about €3 billion per year in investments.

“It’s not a financial challenge, it’s an industrial challenge,” she said, adding that the financing schemes envisaged by France – such as contracts for difference or a regulated asset base – were similar to those in other countries.

EDF and the government are in talks for a new nuclear regulation to allow the group to invest in its projects while also protecting consumers from excessive price increases.

One of the potential measures could be a cap on the revenues of EDF, which was fully nationalised in early June.

While discussions of power market reform are taking place at the European Union level, French President Emmanuel Macron has announced the government’s intention to “regain control of the price of electricity” as a part of a law by the end of the year, without specifying how.

Short-term measures to cap prices could have an affect on long-term investment and climate goals, ICIS energy market analyst Matthew Jones said, adding that trying to change prices would make investors weary in the future.

“If you make electricity prices cheaper in the short term, (industrial companies) are less likely to invest in measures that would require them to reduce their emissions,” Jones said.

Representatives of some two dozen countries attended the nuclear conference at the OECD and published a call to support nuclear power at the United Nations climate change conference (COP28) in Dubai, from 30 November to 12 December.