EDF, new losses for the French electrician

The fall in nuclear production, which will fall this year to its historic low since the construction of the park, is costing EDF dearly. In a new estimate, published Thursday, October 27, the group has revised upwards the impact on its accounts, with 32 billion euros less on its earnings before interest, taxes, depreciation and amortization (Ebitda) this year, against 29 billion announced in September and 24 billion in July.

It could even be even worse by the end of December, recognizes EDF, stressing that the repercussion of social movements, which have disrupted maintenance work in the plants since September, is being quantified.

“Nuclear production in France for the first nine months stands at 209.2 TWh, i.e. 59 TWh less than for the same period in 2021”, explains the group. Over the year, it will be at the bottom of the forecast range, between 280 TWh and 300 TWh.

Due to the drought, hydro production is also expected to be very low. From January to the end of September, it reached 24.9 TWh, a third less than over the same period of 2021.

An explosion of debt

EDF is therefore heading straight for a historic loss. In the first half alone, it has already reached 5.3 billion euros. As for the debt, it promises to be stratospheric. It could climb to 65 billion euros… against 43 billion at the end of December 2021.

Certainly, the company, which will be renationalised, benefits from the guarantee of the State. But its financial burden will still rise sharply, especially as interest rates rise. A crucial point when it has to face an investment wall of a hundred billion euros to extend the life of its reactors.

A claim against the state

Added to all this bad news are the measures taken by the government at the start of the year, with the increase in the share of electricity that EDF is obliged to sell at low prices to its competitors. Until then, it sold them 100 TWh at €42/MWh. An additional 20 TWh were added to this in 2022, sold at €46.20/MWh.

Problem, the group had already sold on the market this volume of electricity. He therefore had to buy back these 20 TWh at a high price (€257.95 per MWh) to then sell them back to alternative suppliers almost six times cheaper.

EDF assesses this damage at 8.34 billion euros and announced, Thursday, October 27, having filed before the administrative court of Paris “a compensatory remedy in order to obtain full reparation by the State”.

The return of former customers

All is not black, despite everything. In terms of good news, there is first the strong increase in turnover. EDF benefits from the rise in prices on the gas and electricity market. It has almost quadrupled in Italy, it has risen by 51% in the United Kingdom and 47% in France. In total, sales increased by 77% over nine months, to 101.5 billion euros against 57 billion compared to the same period in 2021.

The difficulties encountered by alternative suppliers, who increase their prices or push their customers to leave, benefit EDF commercially. The company has the obligation to take back its former subscribers at the regulated tariff. Over one year (from September to September), the company posted a net gain of 939,000 customers. And the pace quickens. “We are registering around 100,000 more residential customers per month, whereas a few years ago the movement was the opposite with 100,000 departures per month”explained Marc Benayoun, the director of the customer division, at the beginning of October.

But this massive return of households will not save EDF money this year. The electrician even mentions a negative impact on its gross operating surplus “given the purchase of the corresponding volumes on the market at very high prices”.

Repairs in record time

Things are also going better with regard to the corrosion problems encountered on the pipes in some power stations. Repairs have been completed on the circuits of six reactors, they are in progress in four others, and checks are in progress in five reactors, indicates EDF, where we are pleased with the work carried out by the engineers in record time, for cutting out defective parts and replacing them, using very complex welding.

The priority displayed by Luc Rémont, the future boss of EDF, who could take office in mid-November, will be to restart the 27 reactors (out of 56) currently shut down as quickly as possible.


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