What future for the different electricity sources? SFEN Atoms for the Future 2013 Yves Giraud, Generation Economics & Strategy Director EDF Paris, 22 nd October 2013 1
Once upon a time, Europe had a dream. 2
Back to Coal! 3
Coal, the king of the ring First in the world Highly standardized - 2000 /kw Flexible Fuel easy to extract and transport CCS? 40% of the world electricity generation 4
Gas, a (fallen) sprinter Easy, fast and cheap (900 /kw) Clean compared to coal Today CCGT in Europe are closing because of low coal and CO2 prices 22% of the world electricity generation 5
Low carbon energy Nuclear 13% 33% of the world electricity generation Hydro 16% other renwables 4% 6
Energy efficiency, a solution to reduce electricity demand Clean High costs (1000 to 4000 /KW) Bad return on investment 7
Renewables, like a dream Advanced technologies Easy to implement Clean? Costs depending on technologies (1000 /kw to 4000 /kw) Parc éolien de 30 MW, à Mistretta, en Sicile In the right place at the right time 8
Nuclear nightmare? March 2011 Fukushima 9
Time for a nuclear dream! Low carbon Competitive (over the long term) Good for employment Stable price Parc éolien de 30 MW, à Mistretta, en Sicile Difficult, long and expensive (> 4000 /MW) Long construction time Complex (political, legal and safety) 10
Lots of countries see a future for nuclear Existing reactors and new build projects New build projects/programmes Exsiting reactors with no new build projects Nuclear exit or phase out 11
Opinion on nuclear is not that bad Question: what is your opinion of the use of nuclear energy in your country? In Favorable favour Against Opposé Hésitant Unsure Sans No opinion 34 13 22 31 34 14 15 37 34 15 35 16 34 16 30 20 29 22 34 15 18 50 26 6 19 68 6 7 Source: CSA; questionnaire realised between 26/11/12 and 18/12/12 12
The benefits of nuclear are well known Affordable electricity Security of supply, helping the trade balance Low carbon electricity generation A large number of job opportunities in high performing industries 300 250 200 150 100 50 0 800 600 400 200 Residential electricity prices ( /MWh) in H2 2012* 228/MWh European average of 17 Eurozone countries outside of France 268 222 228 230 179 145 France UK Belgium Spain Italy Germany CO 2 emissions (gco 2 /kwh) in 2010** Average OECD-Europe *Source: Eurostat H2 2012 **Source: IEA Facts 2012 0 France Belgium Spain Italy UK Germany Poland 13
Nuclear remains a competitive technology WIND, SOLAR PV NEW BUILD COAL, GAS AND NUCLEAR EXISTING NUCLEAR 70 à 100 /MWh 85-185 /MWh + additional system costs ~55 /MWh Cour des Comptes 38 /MWh 2012 Tariffs Part of base load generation Existing Nuclear New SC Coal, gas and NNB Renewables 14
Existing: achieve life extension USA : 70 of 104 reactors have already obtained the license for 60 years The «Grand carénage» in France An opportunity for our industry An industrial, human and financial challenge 15
Belgium: a new mechanism for securing Tihange 1 nuclear life extension? Market price? Fixed price State Margin Operator 70% of revenues 30% of revenues Fair margin /MWh Life extension costs Under negotiation Generation costs 41.8* Bill adopted by the Government Tihange NPP Belgium Government is considering setting a fixed price* for electricity generated from Tihange 1 Any revenues above this price will be split between the State and the operator by 70% and 30%, respectively * 41.8/MWh as announced in L Echo 16
New Build: brighter times ahead for nuclear! 17
The challenge of the investment cost /kwg Wind, PV 900 MW 1300 MW 1500 MW Nuclear? EPR 1980 1990 2000 2010 18
Nuclear development is being driven by non-oecd countries (mainly Asia) *Note: New Policies Scenario. Source: IEA World Energy Outlook 2012 19
European industry must continue its nuclear history both for international and renewal of existing OLKILUOTO 3 (Areva) FLAMANVILLE 3 EPR feedback experience Optimisation POLAND 1 & 2? Extended range of models TAISHAN 1 & 2 HINKLEY POINT? ARABIE SAOUDITE HINKLEY POINT 3 & 4? SAUDI ARABIA? 20
UK : Hinkley Point C, as it will be in the future 21
The CFD is a long term contract providing stability to both customers and investors 92,5 /MWh 22
Poland: a robust process is underway which in a sense can be compared to the commitment of UK A strong political commitment to the polish nuclear programme: 2011: Nuclear Package voted almost unanimously (407 for vs. 2 against) by the Parliament 2012: PGE announces a package of Integrated Proceedings for the first nuclear project Spring 2013: preliminary dialogue with interested bidders End-2013: finalisation of Polish Nuclear Programme 2025-2030: target commissioning date for 6,000MW EDF and its partner Areva have announced their intention to participate in the Polish NNB programme 23
Towards a new market design Difficulties to launch nuclear projects in a deregulated market. as for any other technologies Let s invent a new market design for nuclear 24
Let s start a new dream with nuclear Nuclear will play an important role Life extension must be achieved A vital need for NNB projects 25