By Forrest Crellin and Benjamin Mallet
PARIS (Reuters) -France has agreed to issue state-owned EDF with a subsidized loan covering at least half the construction costs of six nuclear reactors, president Emmanuel Macron’s office said on Monday, a major step in its plan to renew an ageing nuclear fleet.
Negotiations between EDF and the state over financing are expected to be finalised in “coming weeks”, the statement said, before being sent to the European Commission for approval.
An agreement on financing would clear a major hurdle for one of the country’s biggest public projects in years.
Macron announced plans in early 2022 for six new reactors with a total production capacity of about 10 gigawatts to partly replace old plants and also secure future energy supplies.
Construction of the first reactor is due to start in 2027 but Macron has never said who would pay for the project, which at the time was estimated to cost around 52 billion euros.
Recent media reports suggest costs may be higher, reaching as much as 67 billion euros.
EDF declined to comment on the outcome of the meeting, but said that costs will be refined in the coming months with the submission of estimates to the government by the end of the year.
The company is expected to reach a final investment decision by mid-2026, with commissioning expected by 2038, the Elysee said. It did not provide details on the size of the loan.
The plans for a subsidized state loan, previously reported by Reuters, also include a price ceiling on contracts for difference (CFD) for the new reactors, which would be set at a maximum of 100 euros per megawatt-hours (MWh) in 2024 value.
The CFD cap is well above current market contract for 2026 priced at 61.6 euros per MWh.
A CFD specifies a fixed price for a power contract over a set period to protect the buyer and seller against market volatility.
The financing arrangement is similar to what was agreed recently for a reactor in the Czech Republic.
($1 = 0.9157 euros)
(Reporting by Forrest Crellin, Benjamin Mallet and Michel Rose, editing by Dominique Patton, Tomasz Janowski and Andrew Heavens)
