EDF's Flamanville-1 reactor to return in May; ARENH talks near finish

France's 1.3-GW Flamanville-1 reactor is set to return in May from a 19-month-outage with the restart delayed just two days to April 30 23:00 local time, operator EDF said in a transparency note April 27.

Gravelines 5 was scheduled to restart April 28 at midday, slightly earlier than planned, while Cruas 1 was delayed another fortnight to June 13, it added.

On balance and despite combined announced delays of over 50 days to reactor returns this quarter, French nuclear output from May to October is forecast significantly higher than in 2020 when output hit record-lows, according to S&P Global Platts Analytics.

Platts Analytics has, however, lowered its forecast following the recent delays and now assumes nuclear dispatch of 37.2 GW in May and of 36 GW in June, with nuclear still set to meet well over 80% of assumed power demand. That compares to an average of 71% for the year to date.

"Downside risk to nuclear output from additional delays to reactor restarts is weighted more heavily to the third quarter as temperatures in May and June are typically neither low nor high enough to trigger any notable heating or cooling demand," Platts Analytics said in a weekly report April 26.

French power at 2-year-high as ARENH talks near "finish line"

Further out, French year-ahead power currently trades at a 2-year-high above Eur58/MWh, a level only seen for a brief period in late 2018 over the past decade, EEX data show.

According to French daily Figaro, negotiations between France and the European Commission about reform of the ARENH nuclear price mechanism were approaching the "finish line."

Restructuring of the state-owned utility hinges on a reform of the ARENH price currently set at Eur42/MWh.

EDF considers this as too low to finance life-span extension of the current fleet, a project knows as 'Grand Carenage.'

Neither EDF, which is not directly involved in the ARENH talks, nor the French energy ministry were able to comment on the matter when contacted by Platts.

Union syndicate FNME-CGT, which opposes a restructuring of EDF, said last month that a decision was to be made by mid-April with or without accord with Brussels.

Restructuring plans for the 83%-state-owned utility involve a split into nuclear (EDF Blue) and mainly renewable (EDF Green) activities although no plans have been presented publicly as yet.

The report by Le Figaro notes a Eur49/MWh price for the new ARENH price allowing for cross-financing of renewables if the market price of green electricity exceeds the new regulated price for nuclear power, according to a note by French investment bank SocGen.

The article quoting anonymous "government sources" also set a May 19 date for the law to be discussed by the council of ministers with the government intending to present a bill to parliament before the summer recess. Many observers note time pressure before the start of the election campaign for the 2022 presidential elections this autumn.

French nuclear generation hit a record-low 335 TWh in 2020. EDF forecasts 2021 and 2022 output in a range of 330-360 TWh.

The Flamanville 1 reactor has been offline since Sept. 2019 for extra works following a 10-year-overhaul that started in Jan. 2018.

EDF in January returned unit 2 at Flamanville following a similar overhaul that lasted almost two years.

FRENCH REACTOR WATCHLIST

Source: EDF