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UPDATE 1-EDF says longer reactor outages may weigh on 2018 earnings
November 14, 2017 / 9:00 PM / 3 days ago

UPDATE 1-EDF says longer reactor outages may weigh on 2018 earnings

* This winter 4-5 reactors unavailable vs 9 last year

* Nuclear output will be a key driver of core earnings

* EDF expects outages to be again longer than planned (Adds EDF executive quotes)

By Geert De Clercq

PARIS, Nov 14 (Reuters) - French utility EDF said on Tuesday that future nuclear reactor maintenance outages could be longer than expected and that these could weigh on 2018 core earnings.

EDF chief financial officer Xavier Girre said on an earnings call on Tuesday that in 2017 several reactor outages had to be extended, sometimes for significant periods of time and that the expected drop in availability of the French nuclear fleet at the beginning of 2018 will have a negative impact on earnings.

“When taking stock of the reasons behind these extended outages, it seems appropriate to consider that future planned outages could face extensions and that average availability may be reduced over the first part of the year,” Girre said on the call on EDF’s nine-month earnings.

He said that while the overall impact on output might be relatively small, these outages will take place in winter, when power has most value, and therefore hit earnings more.

On Monday, a week after cutting its 2017 earnings targets, EDF also cut 2018 earnings and cash flow targets after nuclear regulator ASN this autumn ordered the closure of EDF’s four Tricastin reactors for safety reasons.

Several other reactors’ planned outages have also taken much longer than expected.

EDF cut its forecast for 2018 core earnings to a range of 14.6 to 15.3 billion euros, from a previous forecast for at least 15.2 billion.

“Nuclear output will be a key driver with respect to this range,” Girre said.

A total of 19 of EDF’s 58 reactors - which generate three quarters of France’s electricity - are currently offline, although 15 of those are expected to restart by early December to be ready for the coldest winter months, EDF nuclear fleet chief Dominique Miniere said on the earnings call.

Miniere said the dike of Tricastin’s cooling water canal had been reinforced end October and that EDF is now waiting for ASN clearance to restart the reactors.

He said that this winter a maximum of four to five reactors will be offline compared to nine last winter.

Miniere said the Fessenheim 2 reactor would not be restarted as expected in January. The reactor has been offline since June 2016 because of weak spots discovered in the steel of a Creusot-made steam generator.

It had been expected to restart end January 2018.

The Paluel 2 reactor will also remain offline as EDF’s main supplier has been late in replacing steam generators, Miniere said. (Reporting by Geert De Clercq; Editing by Maya Nikolaeva and Jane Merriman)

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