France’s nuclear energy buildup could be backed by state loan

Leyrieu, Isere: Over half the costs of construction of France’s six new nuclear power reactors could be covered by a state loan, the French presidency indicated in a statement today, following a Nuclear Policy Council meeting.

The council, which pilots France’s nuclear policy, examined the “main principles” of the financing and regulation of the projects, the statement from the Élysée said.

This “is based on a subsidized government loan covering at least half of the construction costs and a contract for difference on nuclear generation at a maximum price of €100 2024/MWh”, according to the statement.

Under contracts for difference, a power producer and the state agree to reimburse each other when power prices rise above or fall below a certain price range agreed in advance. But in this case, only the maximum electricity price is mentioned, a possible indication of a price cap.

This plan will allow France and its state electricity production company, EDF, to finalize talks “in the coming weeks” so as to rapidly start talks with the European Commission, the Élysée said.

This should allow EDF to take a final investment decision in 2026, according to the statement, with the six new reactors expected to enter into service by 2038.

Under a strategy to boost nuclear energy production announced by French President Emmanuel Macron in 2022, France could build 14 new nuclear reactors in coming years, including the six already in the pipeline.

The Nuclear Policy Council asked the French nuclear sector to submit “a work programme and a proposed industrial organisation” to the government by the end of this year, according to the statement.

The council also greenlit a “development strategy for Orano’s mining activities” to ensure uranium sovereignty in the current geopolitical context, the statement said. Orano is France’s state-owned nuclear fuels multinational.