French auditor Cour des Comptes joins rising concern over EDF’s ability to finance Hinkley Point C
A French auditor has joined the rising chorus of concern over utility giant EDF's ability to finance the £18bn Hinkley Point C project.
Cour des Comptes, France's top audit body, said the state-owned utility should ask "serious questions" over the building the two nuclear power plants in Somerset.
It comes a week after EDF's finance director, Thomas Piquema, resigned over the negative impact of the project on the company's already stretched balance sheet.
His resignation raised red flags for analysts at Deutsche Bank, who said EDF is “facing a squeeze between a political desire to commit to the project and the financial realities that EDF is struggling with declining power prices and rising liabilities”.
The report, which analyses EDF's October 2013 agreement with the UK government but not its October 2015 deal with China's CGN to take a one-third stake, called for the project to be analysed by EDF and its state shareholder.
It said that the company's cashflow and high debt reduces its ability to invest abroad, which is exacerbated by the costs of upgrading its fleet of ageing French nuclear power plants.
Cour des Comptes was also critical of the foreign investments EDF has made to-date, saying their returns on have been routinely lower than those in France.