France Mulls Nuclear Overhaul as AREVA Reports $5.6B Loss

France will look at all options in an attempt to overhaul its state-run nuclear industry, French Energy Minister Ségolène Royal told reporters on Monday, after AREVA reported a $5.6 billion loss for 2014. 

The nuclear giant announced in a Feb. 23 statement that it expects a hefty €4.9 billion loss ($5.6 billion) for 2014. The preliminary financial information compares to a loss of €500 million suffered in 2013. AREVA said the loss is attributable in part to delays and cost overruns at the Olkiluoto 3 EPR project in Finland and a research reactor construction project, as well as to renewable energy contracts. The company is expected to release a strategic and financial roadmap next month.

France relies on nuclear power for about 75% of its electricity, but an energy transition bill passed by the National Assembly last October could reduce that share to 50% by 2025. The bill is expected to be ratified this year.

The government owns about 87% of AREVA and 85% of EDF, a utility that operates the nation’s aging 58-reactor fleet. EDF—Europe’s biggest power generator—has been plagued with similar financial troubles stemming from delays and cost overruns at an EPR under construction at Flamanville. EDF is in negotiations with the UK government to build and operate a new reactor at Hinkley Point.

But since November, the government has replaced leaders at AREVA, EDF, and at nuclear researcher Commissariat a l’Energie Atomique et aux Energies Alternatives (CEA).

On Monday, Royal said it was too early to determine whether AREVA will be given a funding injection. EDF’s new CEO Jean-Bernard Levy, meanwhile, has urged the government to implement gradual electricity tariff increases to help the utility fund renewable energy projects and modernize its aging nuclear fleet.

Sonal Patel, associate editor (@POWERmagazine, @sonalcpatel)