French government urges EDF to close aging nuclear plant as decision looms

PARIS (Reuters) - French Energy Minister Segolene Royal warned EDF’s board on Wednesday against trying to prevent the closure of France’s oldest nuclear plant, as a long-running conflict between the state-controlled utility and the government comes to a head.

FILE PHOTO - The logo of French state-owned electricity company EDF is seen on the France's oldest nuclear power station of Fessenheim, November 14, 2013 . REUTERS/Vincent Kessler

EDF EDF.PA has scheduled a board meeting on Thursday to decide the fate of the 1,800 megawatt Fessenheim plant near the German border. Its closure was an election promise of outgoing President Francois Hollande in 2012, but the company has so far managed to put off a final decision.

Unions oppose the closure, saying it would cause job losses and France’s hardline CGT trade union urged its members to picket EDF’s headquarters during Thursday’s meeting to keep pressure on the board members.

“The board is going to have a debate and normally EDF’s chairman should give me a request (afterwards) to close Fessenheim as planned,” Royal said on CNEWS.

Environmental groups have long suspected EDF of playing for time, seeking to prevent the closure from becoming irreversible before the end of Hollande’s presidency next month.

EDF’s management has argued that safety issues would not be a reason to close the plant since the nuclear watchdog deemed it safe after the utility invested hundreds of millions of euros to reinforce security following the Fukushima disaster in Japan.

Fessenheim’s two 900-megawatt reactors each bring EDF about 200 million euros (£170.85 million) in earnings before interest, taxes, depreciation and amortisation (EBITDA) per year.

The CGT union called on workers’ representatives on the EDF board to oppose the plant’s closure, saying it would be an economic and industrial waste.

“The Fessenheim plant is safe, and it is recognized as such by the Nuclear Safety Authority,” CGT said in a statement, adding that the plant contributes to French energy security.

France, a major electricity exporter in Europe, depends on its 58 nuclear reactors for more than 75 percent of its electricity supply.

The outcome of the 18-member board meeting on Thursday is uncertain because only 12 members, including the six union representatives, will vote while state representatives would have to abstain to avoid any conflict of interest.

“I’m warning the board members who are tempted to listen to inexact information and could harm the company’s interests,” Royal said.

EDF and the government have reached a 490 million euro compensation agreement covering costs associated with the closure.

The company also received some guarantees that could allow it to shut down the reactor by end-2018, when it starts production at its new generation EPR reactor under construction in Flamanville in northern France.

Reporting by Bate Felix, Benjamin Mallet, Yann Le Guernigou, Michel Rose, writing by Leigh Thomas; Editing by Susan Fenton