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ENERGY

Vattenfall ‘may gain’ from German nuclear move

Swedish energy giant Vattenfall may end up benefiting from a recent decision by Germany to ditch nuclear power, according to the company's CEO.

Vattenfall 'may gain' from German nuclear move
A Vattenfall nuclear power plant in Germany

While the German decision will be costly for Vattenfall initially, CEO Øystein Løseth believes the German state has a responsibility to help the company ease the financial fallout.

“We’re expecting compensation from the German state,” Løseth told the TT news agency when commenting on the decision.

Since 2007, Vattenfall has invested around 6.3 billion kronor ($1.02 billion) getting its German nuclear power plants in order – spending which can now be considered money washed down the drain for the Swedish state-owned energy giant.

However, there is an upside to the German decision, according to Løseth, in that Vattenfall’s other operations, such as coal-generated power plants, will become much more valuable.

“There’s no doubt that there will be an increase in value,” he said, adding that it was still too early to say for sure whether or not the increase would mitigate the costs related to shutting down the company’s nuclear power operations in Germany.

One of the factors that would affect whether or not Vattenfall could ultimately benefit is the outcome of compensation negotiations with the German state.

In a statement issued on Tuesday, Løseth said he expected “fair treatment” from the German state in negotiations over financial compensation.

Vi förväntar oss en rättvis behandling och att vi blir finansiellt kompenserade med anledning av det tyska beslutet, säger VD Øystein Løseth.

Germany’s decision has already had an effect on electricity prices – effects which show up in trading of future electricity deliveries.

And electricity on the continent will likely be more expensive, according to Løseth. However, prices in Sweden are more affected by the weather.

“A wet autumn has greater significance and probably results in lower prices than what we’ve had during recent winters,” he said.

According to Løseth, the Germany’s nuclear decision won’t bring about any changes in Vattenfall’s overall strategy.

Nor has he received any new directive from Vattenfall’s owners – the government and the Swedish state.

Løseth theorised that Vattenfall’s coal operations may also become even more important for Germany in the wake of the nuclear decision.

Despite Germany’s move to shutter its nuclear power plants, Løseth doesn’t see any plans for Sweden to follow suit.

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BUSINESS

France’s EDF hails €10billion profit, despite huge UK nuclear charge

French energy giant EDF has unveiled net profit of €10billion and cut its massive debt by increasing nuclear production after problems forced some plants offline.

France's EDF hails €10billion profit, despite huge UK nuclear charge

EDF hailed an “exceptional” year after its loss of €17.9billion in 2022.

Sales slipped 2.6 percent to €139.7billion , but the group managed to slice debt by €10billion euros to €54.4billion.

EDF said however that it had booked a €12.9 billion depreciation linked to difficulties at its Hinkley Point nuclear plant in Britain.

The charge includes €11.2 billion for Hinkley Point assets and €1.7billion at its British subsidiary, EDF Energy, the group explained.

EDF announced last month a fresh delay and additional costs for the giant project hit by repeated cost overruns.

“The year was marked by many events, in particular by the recovery of production and the company’s mobilisation around production recovery,” CEO Luc Remont told reporters.

EDF put its strong showing down to a strong operational performance, notably a significant increase in nuclear generation in France at a time of historically high prices.

That followed a drop in nuclear output in France in 2022. The group had to deal with stress corrosion problems at some reactors while also facing government orders to limit price rises.

The French reactors last year produced around 320.4 TWh, in the upper range of expectations.

Nuclear production had slid back in 2022 to 279 TWh, its lowest level in three decades, because of the corrosion problems and maintenance changes after
the Covid-19 pandemic.

Hinkley Point C is one of a small number of European Pressurised Reactors (EPRs) worldwide, an EDF-led design that has been plagued by cost overruns
running into billions of euros and years of construction delays.

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