EDF warns UK nuclear plant could cost extra 2.9 billion pounds, shares tumble
PARIS (Reuters) – EDF warned on Wednesday that its Hinkley Point C nuclear plant in Britain could cost up to 2.9 billion pounds more than previously estimated, sending shares in the French power company sharply lower.
EDF is already grappling with delays to the project, even longer delays at a plant in Finland, and investigations into welding and steel used in its reactors.
EDF said Hinkley Point C was estimated to cost 21.5-22.5 billion pounds, up 1.9-2.9 billion pounds from previous estimates.
EDF shares were down by around 6% in early trading, marking the steepest fall on the SBF-120 index in Paris.
“A cost increase of around 10% isn’t horrific. The issue however is you have a company with a market cap of 31 billion euros that is currently trading at a year low in a sector that has become increasingly more regulated in terms of price caps,” said MB Capital director Marcus Bullus.
Unit 1 of Hinkley Point C is still expected to begin generating power from the end of 2025, EDF said.
“Our earthworks are complete, but challenging ground conditions meant we overspent to finish them on time,” Stuart Crooks, managing director of Hinkley Point C, wrote in a letter to staff.
State-controlled EDF is building the plant with China General Nuclear Power Corp. It has been beset by delays and rising costs, with EDF raising the cost estimate to 19.6 billion pounds in 2017.
The 3,200 megawatt plant is expected to be completed by the end of 2025 and will provide around 7% of Britain’s power needs, or enough for around 6 million homes.