25 Sep 19
Hinkley Point C

Update on Hinkley Point C project

The view south across the Hinkley Point C Construction Site showing the main excavations and pipework for the cooling water systems of unit 1.
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The Hinkley Point C project successfully delivered J-0, the completion of the nuclear island “common raft” for its first unit in June 2019, in line with the schedule announced in September 2016.

Following this major milestone a detailed review of the project’s costs, schedule and organisation was performed.

The review has concluded that:

  • The next milestone of completing the common raft for Unit 2 in June 2020, which was announced earlier this year, is confirmed ;
  • The previously communicated risk of COD delay of unit one and two (of 15 months and nine months respectively) has increased(1)
  • The project completion cost(2) is now estimated between £21.5bn and £22.5bn, an increase of £1.9bn to £2.9bn(3) compared to the previous estimate.

The range depends on the effectiveness of action plans to be delivered in partnership with contractors.

Cost increases reflect challenging ground conditions which made earthworks more expensive than anticipated, revised action plan targets and extra costs needed to implement the completed functional design, which has been adapted for a first-of-a-kind application in the UK context.

Under the terms of the Contract for Difference, there is no impact for UK consumers or taxpayers.

EDF’s project rate of return for Hinkley Point C (IRR)(4) is now estimated between 7.6% and 7.8%.

The management of the project remains mobilised to begin generating power from Unit 1 at the end of 2025. To achieve this, operational action plans overseen by the project management are being put in place. These involve the EDF Group's engineering teams in Great Britain and France, buildings and ancillary works contractors, and suppliers of equipment and systems throughout the supply chain.

(1) As previously communicated in July 2017, if this risk were to materialise, it would entail an additional cost of around £0.7bn in 2015 sterling. Under this assumption the IRR for EDF would be lower by 0.3%.
(2) In 2015 sterling, excluding interim interest and excluding forex effect versus the reference exchange rate for the project of 1 sterling = 1.23 euro.
(3) Additional costs net of action plans
(4) EDF equity IRR calculated at the exchange rate 1 sterling = 1.15 euro and including the capped compensation mechanism in place between shareholders.

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About EDF Group

A key player in energy transition, the EDF Group is an integrated electricity company, active in all areas of the business: generation, transmission, distribution, energy supply and trading, energy services. A global leader in low-carbon energies, the Group has developed a diversified generation mix based on nuclear power, hydropower, new renewable energies and thermal energy. The Group is involved in supplying energy and services to approximately 39.8 million customers(1), 29.7million of which are in France. It generated consolidated sales of €69 billion in 2018. EDF is listed on the Paris Stock Exchange.

(1) The customers were counted at the end of 2018 per delivery site; a customer can have two delivery points: one for electricity and another for gas

About EDF Energy

EDF Energy is the UK’s largest producer of low-carbon electricity, meeting around one-fifth of the country’s demand and supplying millions of customers and businesses with electricity and gas.

It generates electricity with eight nuclear power stations, more than 30 wind farms, one gas and two coal power stations, as well as with combined heat and power plants.

EDF Energy is leading the UK's nuclear renaissance with the construction of a new nuclear power station at Hinkley Point C. This will provide low carbon electricity to meet 7% of UK demand. The project is already making a positive impact on the local and national economy, British industry, as well as boosting skills and education. EDF Energy also invests in a range of low carbon technologies including renewables and battery storage. It is applying research and development expertise to improve the performance of existing generation and developing the potential of new technologies.

The company provides gas and electricity for more than 5 million customer accounts and is the biggest supplier of electricity by volume in Great Britain and the largest supplier to British businesses. It offers innovative energy systems for commercial customers and digital innovation for customers at home. EDF Energy has also launched its own innovation accelerator, Blue Lab, which focuses on making customers’ lives easier.

The Better Plan is EDF Energy's framework for being a sustainable and responsible energy business and is an integral part of EDF's 2030 vision to be the efficient, responsible electricity company, and champion of low-carbon growth. The Better Plan is underpinned by comprehensive environmental and social programmes which have been recognised by a wide range of organisations.

EDF Energy is part of EDF Group, the world’s biggest electricity generator. In the UK, the company employs around 13,000 people at locations across England and Scotland.

To find out more about the UK's energy challenges visit our energy future webpages.

For more information

EDF Energy Media Team
24-hour press line: +44 (0)1452 652233
media@edfenergy.com