EU approves EDF and CGN’s Hinkley partnership
Tuesday 15th March, 2016
The European Union’s competition authority has approved EDF Energy’s partnership with China General Nuclear Power Group (CGN) for the construction of Hinkley Point C in Somerset.
The Commission’s investigation found that competition in the wholesale supply of electricity in the UK will not be hindered by the transaction given the moderate market share of EDF, the very limited market shares of CGN in this market and the presence of other competitors.
As regards the other nuclear-related markets where CGN and other Chinese State-owned companies are active and which are upstream to the joint ventures’ activities, the Commission found that the parties would not have the ability to shut competitors out of these markets.
The EU approval comes despite fears that the project could stretch EDF’s balance sheet. Finance director Thomas Piquemal last week resigned amid concern that the cost could jeopardise EDF’s future.
But Jean-Bernard Levy, chairman and chief executive of EDF, wrote to staff on Friday (11 March 2016) saying that the project had the support of both the French and British governments.
“We are currently negotiating with the French state to obtain commitments allowing us to secure our financial position,” he said.
“It is clear that I will not engage EDF in this project before these conditions are met. These discussions are ongoing and I am defending our group for the present and especially the future.”