January 24, 2017 / 12:25 PM / in a year

UPDATE 2-EDF board approves state compensation for nuclear plant closure

(Updates with EDF statement, CEO quotes, details)

PARIS, Jan 24 (Reuters) - The board of French state-controlled utility EDF has approved the government’s plan to compensate it for the planned closure of the Fessenheim nuclear plant, against which trade unions have protested over fears of possible job losses.

EDF and the French government agreed last year on a compensation package for shutting down the site.

EDF said on Tuesday it would get an initial payment of around 490 million euros ($526.7 million) covering costs associated with Fessenheim’s closure, and added it could then get further payments up until 2041.

EDF also confirmed that Fessenheim’s closure would require a government decree, subject to EDF obtaining official authorisation for its new generation EPR reactor in Flamanville and for the re-start its 1,300-megawatt (MW) Paluel 2 nuclear reactor which has been offline since May 2015.

This will enable the firm to maintain France’s installed nuclear electricity generation capacity at 63.2 gigawatts.

“This means that the commissioning of the Flamanville 3 EPR is conditional upon the shutdown, on the same date, of an equivalent generation capacity,” EDF said in a statement.

Flamanville is expected to start in late 2018.

“With this decision ... EDF is guaranteeing compliance with legislation imposing a ceiling for France’s installed nuclear electricity generation capacity, while at the same time safeguarding to the utmost the interests of the company and its customers,” Chairman and Chief Executive Jean-Bernard Levy said in the statement.

EDF unions are against closing Fessenheim which they said could lead to job losses and put French power supplies at risk.

The 1,800-MW Fessenheim plant in northeastern France was commissioned in 1978 and is scheduled to stop production this year following a 2012 election campaign promise by outgoing President Francois Hollande.

Some candidates in France’s April and May presidential election, including conservative frontrunner Francois Fillon, are against the closure. He has promised to halt the shutdown.

$1 = 0.9304 euros Reporting by Benjamin Mallet and Bate Felix; Editing by Sudip Kar-Gupta and David Evans

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