Tuesday 26 May 2015

Areva: Getting Serious for EDF and the Nuke Business

Radioactive troubles
It's no small matter in the world of nukes that EDF needs to bail out Areva by one means or another.  The terrible twins of the French energy policy, or more specifically l'√©quipe de France du nucl√©aire are bound together in fate.  It seems implausible that Areva can bear the liabilities, legal and financial, arising from its disastrous attempts to get the first few EPRs up and running: but where is EDF's immense nuclear fleet without Areva?  Where is France without the nukes?  Who will pay?

Radioactive turd
I've been raising this question here since CU first invited me on board.  France plays many strategic games, often quite well, but there is none more pressing for them than this.  For a decade now they have been bending the UK government to their will, and of course I reckon the EU 'Energy Union' is their next campaign-front.  If Cameron is serious about obtaining some material euro-concessions - and IMHO he is - bribing the French (with ours and other peoples' money) will be one possibility.

To illustrate just how serious things are, EDF is also proposing to cut holidays for its white-collar staff !  As welcome as ... a radioactive turd.

(From which, incidentally, I understand you get atomic piles ...)



Demetrius said...

The scary thing is the Cameron may well make an off the cuff offer to help out EDF all he can. This EDF set of liabilities is a shocker and I suspect with much more to come that we do not know about yet.

Blue Eyes said...

ND nice piece. What baffles me are those who say "aha, look how good the French are at industrial policy, the UK should copy them", while staring wistfully at the French nuke industry.

Sebastian Weetabix said...

You might be less baffled when their lights are still on, and ours have gone out.

Blue Eyes said...

Yes, I have often forgotten, in my baffled bleeding-heart lefty idiocy, that nuclear is the only way to generate electricity.

Sebastian Weetabix said...

Let us assume, just for fun, that the theory of catastrophic anthropogenic global warming is absolutely true, and we are therefore right to cut CO2 emissions. To that end we are busy closing down older coal-fired power stations, to the point, IIRC, that by 2018 we won't have any left. Just this morning coal is providing 22% of our electricity supply and gas is providing 38%. Wind is providing 1%, solar virtually nothing, pumped hydro around 2%. We are committed to shutting down the gas generation too, by the way, and DECC plans that by 2050 we won't even be allowed to use gas for cooking in the home.

Unless modern civilisation is to cease existing we have a couple of options:
1. Reverse the idiocy of the climate change act and keep using coal and gas, or
2. Build about 2 dozen large scale nuclear plants pdq.
Why? Because NONE of the so-called renewable alternatives will provide the stable reliable base load that modern civilisation requires. That is an actual, yer know, fucking fact, and no amount of wishful thinking will make it otherwise. And before leftards start whining about carbon capture and home electricity storage and all that bollocks, allow me to point out a number of home truths:
1. Carbon capture does not work
2. You cannot store A/C electricity
3. More than 20% renewables on the grid will lead to brown outs, surges and catastrophic grid instability that will prevent industry functioning
4. If you think it smart to have lithium ion batteries and inverters in every house and place of business linked up to mini wind turbines and solar panels, sell any shares you have in companies that peddle insurance. They'll be dealing with more fires than the fucking blitz.

Thank you for demonstrating why arts & PPE graduates shouldn't be allowed near important decisions relating to power infrastructure.

Budgie said...

SW, I think that just about nails it for the CAGW believers!

rwendland said...

A key fact to remember about Areva is that new nuclear is only around 8% of Areva's business, but gives a huge proportion of the financial risk in the business. Most of Areva's business is fuelling and (along with EDF engineering) maintaining the French and other's nuclear fleets.

As there is a tiny market for new nuclear in the West (where new nuclear finance costs a prohibitive 10% to 15%/year), and given the probable life extension of most of France's fleet to 60 years so no new nuclear needed there for 30+ years, the financially rational thing for EDF-Areva to do seems to be withdrawing from the new nuclear market. And try to stay in the profitable large nuclear equipment market (pumps, reactor heads, control systems, etc) generally saleable for both maintenance and new nuclear. But can the French make such a rational decision in its politics and mindset?

It seems to me the only countries that could stay in the new nuclear business are those with a heavily regulated or state funded home generation industry, where they have not already saturated the home market - that is China, Russia and possibly South Korea. If the Japanese people can get over Fukushima, possibly Japan as well (but not all 3 new nuclear companies: Toshiba/Westinghouse, Mitsubishi (with Areva) and Hitachi) - though I think this unlikely.

There are far too many new nuclear companies and it is time for rationalisation. France has drawn the shortest straw, and Japan has had its straw cut almost as short. The UK and Germany have luckily already bailed out of this overpopulated game.

Nick Drew said...

SW, your 1/2/3/4 list is an excellent summary

the problem you have is, however, neatly encapsulated in '2 dozen large scale nuclear plants pdq'

as they used to say on ISIRTA ... Sorry, It Can't Be Done

personally, as you might recall, I have long advocated replacing old coal (the inefficiency of which is pretty grotesque) with ultra-smart new coal

Blue Eyes said...

I enjoy having people project their views onto me. I hope that at a future C@W drinks you will not all be disappointed.

Sebastian Weetabix said...

The correct answer is to repeal the CCA and carry on with coal & gas and get fracking. Don't hold your breath. We will only get change when reality bites, since the entire media and all the political parties have all signed up to the CAGW bull, with the exception of the cult of Nigel, who is unelectable for other reasons.

Anonymous said...

Hes certainly a cult.

rwendland said...

... Nuclear Engineering International have just published an article backing up my contention that the post EDF EPR reactors the government hopes to build will be cheaper than the Hinkley Point C EPRs. Cambridge prof and ex-MD of of Rolls-Royce Nuclear, Tony Roulstone, claims the combined fleet of 2 EPRs at Hinkley Point + 5 Hitachi ABWRs at Wylfa and Oldbury + 3 AP1000s near Sellafield is costed to produce leccy at £80/MWh (2013 prices). This means the non-EDF reactors must average £76/MWh to balance out the outrageous £92/MWh EDF price.

Assuming some price slippage to £80/MWh for ABWR and AP1000, this is still twice current UK generation costs, but a fair bit cheaper than Hinkley Point C.