France Lures Investment With Cheap Nuclear Power
First Published Monday, 28th March 2011 06:00 pm - © 2011 Dow Jones
PARIS -(Dow Jones)- France's nuclear energy industry provides cheaper power for industry, helping to lure investment from abroad, the Invest In France Agency said Monday, as debate in Europe over the future of nuclear power has intensified following the Fukushima power plant disaster.
"France's dynamic energy market is one of the most competitive in the world," the IFA said in a report. It cited figures from Eurostat showing France's industrial-use electricity rate per kilowatt hour is EUR0.075, below Germany at EUR0.112 and the U.K. at EUR0.099.
Nuclear power from France's 58 reactors supply 81% of the nation's electricity, making the country the second largest user of nuclear power behind the U.S. and ahead of Japan.
The French finance minister cited cheap energy as a key factor in attracting foreign investment, along with France's access to Europe's consumer market, labor productivity, infrastructure, and education.
"We have rather cheap, clean, low carbon cost energy. That is obviously attributable partly to our nuclear power sourcing," Christine Lagarde said at a briefing for journalists in Paris.
Company executives at the briefing also praised France's energy industry.
"For the chemical industry, which is a large consumer of energy, the policy in France is quite remarkable," said Christian Jourquin, chief executive of chemicals company Solvay SA (SOLV.BT). As a long term investor, France's predictable energy prices are a "unique element" for the economy's competitiveness, he said.
However, the nuclear industry in Europe is coming under pressure following the Fukushima energy disaster. At a summit of leaders last week Austrian Chancellor Werner Faymann said the European Union needs an "exit strategy" from nuclear power, and leaders agreed to carry out stress tests on all European nuclear plants.
Although no guidelines were given on how to respond to the results, French President Nicolas Sarkozy pledged to immediately close any plants failing the tests.
His energy minister Eric Besson has warned that following the Fukushima disaster the nuclear industry could be subject to higher security demands, entailing higher costs.