This led EDF to adjust the schedule and the estimated construction cost for the Flamanville EPR(1).
The provisional schedule for implementation of the preferred penetration weld repair scenario, if the objective of ASN validation is achieved, sets the date of fuel loading in late 2022 and the revised construction cost at €12.4 billion(2), an increase of €1.5 billion. Most of these additional costs will be treated as operating expenses, rather than being capitalised. These costs will affect the financial years 2020, 2021 and 2022. For 2020, the impact on net income is estimated at €(0.4) billion net of taxes, all other things being equal.
The process of realignment of the 58 welds on the secondary system that have quality deviations or are not in compliance with the break preclusion principle requirements defined by EDF is being continued on site. At the same time, the second hot functional test phase was started on 21 September 2019. Hot functional testing checks plant performance under simulated normal operating conditions.
Framatome has informed EDF(3) of a deviation from technical standards governing the manufacture of nuclear reactor components. The deviation relates to the performance of the manufacturing process used, which did not respect temperature ranges in certain areas during manufacturing operations involving stress-relieving heat treatment on some steam generator welds. It concerns in-service components as well as new components which have not yet been put into operation or installed on any sites.
On 9 September 2019, EDF informed the ASN of its initial investigations concerning the deviation in a post-weld stress-relieving heat-treatment process applied to certain nuclear reactor components.
Work conducted since then by EDF and Framatome(4) to make an inventory of the equipment and reactors concerned and confirm that they are fit for operation has identified 18 steam generators installed on six reactors currently in operation: reactors no. 3 and 4 at Blayais, reactor no. 3 at Bugey, reactor no. 2 at Fessenheim, reactor no. 4 at Dampierre-en-Burly and reactor no. 2 at Paluel.
The components that are not yet in service are the four steam generators and the pressuriser at the Flamanville 3 EPR, as well as three new steam generators that have not yet been installed and were made to replace the steam generators on reactors no. 5 and 6 at Gravelines.
Following publication by the ASN on 24 October 2019 of the information notice entitled “Manufacturing deviation at Framatome stress-relieving heat treatment of welds”, EDF took note(5) that the reactors involved can continue to function as they are, with no need to be shut down for the checks required to address the discrepancies. Physical checks were carried out on the relevant welds in the new steam generators when they were installed at Gravelines 5, the relevant welds of in-service steam generators when they were shut down for fuel reloading (Blayais 4, Paluel 2 and Dampierre 4) and the weld on the Fessenheim 2 steam generator. For the other steam generators in operation the same checks will be carried out on the relevant welds during their next scheduled shutdown for fuel reloading, before the end of the first half-year of 2020 (Bugey 3 and Blayais 3). It is not anticipated at this stage that these shutdowns will need to be extended.
On 17 September 2019, during the IAEA General Conference in Vienna, the French Alternative Energies and Atomic Energy Commission (CEA), EDF, Naval Group and TechnicAtome unveiled “NUWARD”™, their jointly-developed small modular reactor (SMR) project. NUWARD is a PWR (pressurised water reactor)-based solution to meet the growing world demand for decarbonised, safe and competitive electricity generation in the 300-400MWe range.
The CEA and EDF have also initiated discussions with Westinghouse Electric Company to explore potential cooperation on SMR development.
EDF has submitted an application to the ASN and France’s Ministry for the Ecological and Inclusive Transition for the termination of operations and a declaration of the permanent shutdown of both reactors at Fessenheim nuclear power plant. The shutdown of reactor no. 1 is planned for 22 February 2020, whilst the shutdown of reactor no. 2 is planned for 30 June 2020.
This submission followed the signature by the French State and EDF on 27 September 2019 of a protocol agreement whereby the State will compensate EDF for the early closure of Fessenheim, which results from the cap on nuclear power output set by the “energy transition for green growth” law of 17 August 2015.
The compensation paid under the terms of this protocol will comprise:
Through these new agreements, which form a continuity with two other credit lines indexed on the Group’s sustainability performance signed in 2017 and 2018, EDF is reaffirming the central role of sustainable financing instruments in its finance strategy. ESG-indexed renewable credit lines total more than €5 billion at 31 December 2019, accounting for around 48% of the EDF group’s credit lines.
On 22 March 2019 EDF and BBVA signed a €300 million revolving credit facility.
On 22 July 2019 EDF signed two €300 million revolving credit facilities. One is with the Crédit Agricole Group, led by Crédit Agricole CIB and including LCL and Crédit Agricole d’Ile-de-France, and the other is with Société Générale CIB.
These three credit facilities incorporate an adjustment mechanism that links their cost to three of the Group’s sustainability KPIs: direct CO emissions, use of online consumption monitoring tools by its French residential customers (as a proxy for EDF’s success in getting French residential customers actively engaged with their energy consumption), and electrification of its light vehicle fleet.2
(1) The issue of deviation from the technical manufacturing standards for Framatome reactor components (stress-relieving heat treatment process for the welds with electrical resistance) which concerns the four steam generators and pressuriser of the Flamanville 3 EPR is explained in note 2.1.2.
(2) In 2015 Euros, excluding interim interest.
(3) Cf. press release of 10 September 2019.
(4) Cf. press release of 18 September 2019.
(5) Cf. press release of 25 October 2019.
