Engie Slips as Belgium Tightens Grip on Decommissioning of Nuclear Plants
(Bloomberg) -- Engie SA shares fell the most in two weeks as Belgium outlined plans to tighten its grip on the decommissioning of the seven nuclear plants operated by the French utility in the country.
The Belgian government wants to make Engie’s local unit Electrabel SA legally liable for the costs of dismantling nuclear power plants, de Tijd reported Friday, citing Energy Minister Tinne Van der Straeten. The Belgian nuclear regulator will also get far-reaching powers over Electrabel, including a say on capital measures, and dividend payments to Engie, according to the newspaper.
“Engie Electrabel is responsible for the outstanding bill of billions from nuclear power and we are anchoring this more firmly in the law,” Van der Straeten said later in a statement issued by her department. “The best guarantee for the availability of the necessary funds is a strong Electrabel and a strong control of it.”
Electrabel already has accounted for and committed to both the waste disposal and dismantling costs of its nuclear plants in Belgium, and there’s no change to the amount of provisions, Engie said in a statement Friday. Engie’s understanding is that the draft law under discussion focuses on the availability of funds against these provisions, the company based near Paris said, adding that it doesn’t expect any change to its net economic debt from the proposed legislation.
Engie shares fell as much as 3.3% in Paris Friday, and were trading 1.2% lower at 4:24 p.m.
The draft bill comes as Belgium foresees the progressive closing of Engie’s seven nuclear plants -- which provide about half of the country’s electricity -- by the end of 2025. Belgium plans to replace them with a combination of new gas-fired power stations, renewable power, battery storage, and some electricity imports, even as the autumn’s gas crunch in Europe has sent energy prices to record levels.
While Engie recently won Belgian financial support to build two gas-fired power plants, its Vilvoorde project is struggling to get its environmental permit. In a recent letter to Prime Minister Alexander De Croo seen by Bloomberg, the French utility asked for the support of Belgian authorities to quickly start the construction of the power station that will be “key to the balance” of the country’s power system.
A short lifetime extension of a couple of atomic plants would be unprecedented, and there’s no regulatory or technical framework for such a move, Engie wrote. Hence it considers it has no other option than to start the progressive decommissioning.
The Prime Minister’s office confirmed receiving Engie’s letter.
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