France’s EDF says hot summer could hit nuclear output, shares fall

PARIS (Reuters) – France’s EDF might be forced to cut nuclear output further because of expected prolonged hot temperatures over the summer months, an executive told a briefing on Tuesday, prompting a sharp fall in the company’s shares.

EDF’s shares ended down 7.5% on the Paris stock market, underperforming the Stoxx Europe 600 Utilities index, which lost 2.03%.

“We have a peculiar year due to the drought that has started early, especially in southeastern France. But there is generally a little bit less water available this year,” Catherine Laugier, Environment Director at EDF, told a news conference.

France is already grappling with reduced electricity generation because of unexpected maintenance at its aging nuclear reactors.

EDF faces the prospect of having to reduce output because of insufficient river water, which is often used for cooling nuclear reactors before being returned to the river at a higher temperature.

Regulations are in place to limit reactor production during times of exceptional heat and low water levels to prevent the process from damaging local wildlife.

“We’ve had some production cuts between end May and early June. That was indeed pretty early (…) And there are some global evaluations suggesting (…) this might be a very long summer and the levels could be impacted in September,” Laugier said.

Since the start of the year, EDF has lost 20.6% of its value, well below a 12.9% sector-wide decline.

France’s heavy reliance on nuclear energy means it is less dependent on Russian energy supplies than most of it European peers.

However, it too is working on contingency plans in case of a widespread shortage of energy should Russia restrict supplies further and top bosses at energy companies have urged individuals and businesses to reduce power use.

(Reporting by Dominique Vidalon and Benoit Van Overstraeten; Editing by Sudip Kar-Gupta, Tassilo Hummel and Barbara Lewis)