From Peter Sainsbury's Carbon Risk substack, October 19:
Nuclear generation tends to be uncorrelated with carbon prices. The exception is when high power prices coincide with a period of tight carbon allowance supply.
This August’s surge in European power prices coincided with a sharp increase in EU carbon prices towards €100 per tonne as utilities looked to hedge their power generation, while the supply of allowances via auction was limited.
With renewed concern over the outlook for France’s nuclear generation, tight power supplies could result in a repeat scenario developing as we move into 2023.
Before considering the outlook lets recap why France is in this mess.
In late 2021 France’s state owned energy giant EDF, announced that following a regular ten-year inspection, it’s engineers had uncovered faults at one its nuclear reactors. The discovery prompted EDF to close it and three other similar reactors for unplanned maintenance.
Things were to get much worse in early 2022. EDF announced it had found similar problems at yet another reactor, prompting its closure for repairs, and that it was now extending the maintenance outage period at the earlier four problem reactors.
As a result of its maintenance woes, EDF announced that it was lowering its 2022 nuclear power output forecast from 330-360 terawatt-hours (TWh) to 300-330 TWh.
The EU-27 generated 1,404 TWh of electricity from nuclear facilities during the period Mar-Sep 2022, down 75 TWh (5%) from the same period in 2021. Generation restrictions as a result of low water levels during the summer drought contributed to the decline. However, it was persistent technical and maintenance issues affecting more than half of France’s nuclear reactors that has dogged nuclear generation.
Remember that France accounts for around 52% of EU-27 nuclear generation. In 2021, nuclear represented 44% of France’s installed electricity generation capacity (61 GW across 56 nuclear reactors), and 69% of its power generation (581 TWh)....
....MUCH MORE
