France plans a full nationalisation of the EDF in an effort to help the state electricity giant overcome a crisis linked to spiralling debt, falling revenue and an energy price cap, the French prime minister said yesterday.
It is not yet clear what the move means for Britain s future energy security because EDF wants to build a two-reactor nuclear power station in Sizewell in Suffolk.
Laying out her government's legislative programme before the French national assembly, lisabeth Borne said the state would take a 100 per cent stake in the group, which is already building two new reactors at Hinkley Point in Somerset. The state s current holding is 83.88 per cent.
Borne said this evolution will enable the EDF to carry out projects that are ambitious and indispensable for our future as soon as possible. The move was placed in the context of President Macron's drive to ensure that France can meet its own energy needs, suggesting that the stakes were as high as in 1946 when EDF was founded as the country strove to rebuild itself after the Nazi occupation.
The head of government told MPs that we can no longer depend on Russian gas and petrol. We need full control over our electricity production and performance. We must ensure our sovereignty in the face of the consequences of the war in Ukraine and the colossal challenges ahead. It is not yet clear what the nationalisation means for the British plans and assets of the EDF. EDF has a domestic energy supply business with about 3 million household customers, and is the majority owner of Britain's existing nuclear power plants.
EDF is in talks with the government about a funding deal for a 20 billion sister station at Sizewell, as well as building Hinkley Point C.
EDF is expected to retain a 20 per cent stake in Sizewell, and wants to secure a UK government agreement for the taxpayer to take a further 20 per cent stake this month.
The French government did not say whether it plans to make an offer for the 16 per cent stake in the EDF, which the state does not already owns, or to introduce legislation that would force shareholders to sell up.
Officials say full nationalisation will help the EDF find funding for the six new reactors that Macron pledged to build at an estimated cost of €46 billion. The country has 56 reactors that supply 70.6 per cent of its electricity.
Borne said France will be the first world power to end the use of fossil fuels. The decision to withdraw EDF from the stock market has been forced by the group's alarming financial situation, according to analysts.
In 2021, the debt of the EDF was €44 billion, according to analysts at Citi, the investment bank, could rise to €65 billion by the end of the year. The government was under pressure to act, with the group s works council warning that EDF might not get through to the end of the year.