France is considering changing the governance of state-owned utility EDF to shift its focus from nuclear to renewable energy as Emmanuel Macron’s government seeks to cut the country’s reliance on atomic power — the backbone of its energy policy for five decades. Nicolas Hulot, energy and environment minister, told the Financial Times the country’s largest electricity producer needed to embrace a transition towards environmentally friendly energy rather than “resist” it. The process may require revisiting the structure of the company, in addition to a plan to close up to 35 of the 58 nuclear reactors it operates across France within the next 15 years.

FT 14th Nov 2017 read more »

Shares in French energy company EDF dropped more than 10 per cent on Monday after it cut its profit and cash flow targets because of falling demand and delays in restarting some of its nuclear reactors. The state-backed company said earnings before interest, tax, depreciation and amortisation for 2018 were now expected to be between €14.6bn and €15.3bn, compared with its earlier assumption of at least €15.2bn. It also said it was less confident about achieving positive cash flow, saying it will be “slightly positive or close to balance”. It had previously said it would return to positive cash flow, after dividend payments, in 2018. EDF, which is in charge of the controversial new nuclear power development at Hinkley Point in the UK, blamed lower electricity consumption in France, lower availability of some of its nuclear reactors in France and the risk that it might sell less energy in the UK and at a lower price. “Basically, this is the market taking into account the series of bad news that has been coming,” said one sector specialist. “It’s Hinkley Point, it’s the number of plants that have had to be stopped due to the regulator and fundamentally a Nicolas Hulot climate that is not very positive.” Mr Hulot is a climate campaigner and strident critic of nuclear power who is now France’s energy minister. Morgan Stanley suggested that additional risks included “possible delays in the delivery of nuclear plants”, while Mr Jeffery said there is “a strong risk the issue caused by the nuclear regulator’s ongoing investigation into EDF’s existing nuclear plants could roll on beyond early 2018 as anticipated by EDF”.

FT 13th Nov 2017 read more »

City AM 13th Nov 2017 read more »

[Machine Translation] Starting from the depths last spring (around 7 euros), the EDF share price had, since the start, started a recovery. Financial analysts who were still following the value despite its exit from the CAC 40 at the end of 2015, saw some light in the tormented landscape of the energy company: the draft of a reform of the carbon quota market in Brussels – beneficial to investors. French low-carbon champion – and the official government’s postponement of the fall in the share of nuclear power against a backdrop of rising market prices – another positive element for EDF’s revenues. Jefferies, UBS or Barclays have seen in recent weeks reasons to be optimistic about value. EDF’s review on Monday of its financial targets, and in particular the long-standing commitment to generate positive cash-flow after dividends next year, has dampened the markets’ renewed enthusiasm. “From the moment we send a signal, it’s good to respect it,” says a house unionist, yet little attached to this financial commitment.

Les Echos 13th Nov 2017 read more »


Published: 14 November 2017