French energy company EDF discovered corrosion fractures on certain welds at the Blayais 4 nuclear power plant in France

French nuclear regulator ASN (Autorité de sûreté nucléaire - Nuclear Safety Authority ) announced earlier this week that EDF found stress corrosion cracks on some welds at the Blayais 4 nuclear power plant.

Until now it was mostly only newer reactors (1300 and 1450 MW ones: Chooz, Civaux, Penly) that were affected by these safety pipe issues. We knew EDF was running a large checks campaign, however, finding these cracks at their oldest reactors has come as a surprise.

ASN Confirms Corrosion at Blayais Reactor: Implications for Energy Markets

Is this the beginning of a new sequence of generic-issue-driven shutdowns and therefore an upward trend on the European wholesale power markets?

Let’s get straight to the point: No, we don’t think a price rally would be fundamentally justified.

Here are the main reasons:

• Whereas EDF and ASN were flying blind when the first cracks were discovered at 1450 MW units, leading to their shutdown, there seems to be some consensus now that it would be safe to keep the units running and replace faulty parts during standard maintenance. The most likely impact is longer maintenance periods: planned stops, like refueling, would be extended to carry out the repairs.
• Even if some units were to be unavailable longer than expected, the threat to supply/demand in the spring and summer is low. In fact, we think there’s still a risk of oversupply in the system. It’s the same conclusion for winter considering the current level of demand destruction. We saw last January that 6°C below seasonal temperatures was a non-issue, even with only 80% of the nuclear fleet available.

Should we expect a revision to the REMIT planned outages message?

Yes, it is very likely! This has already been anticipated for a while in our Kpler proprietary availability forecast, expecting an availability that would lead to a net 2024 nuclear generation in line with the EDF corporate forecast of [315-345]TWh.

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