Only last week Washington DC-based think tank Worldwatch Institute released its Vital Signs Online (VSO) report noting that the world’s nuclear power portfolio was quickly shrinking. Now nuclear power companies worldwide are posting numbers that reflect the trend.
Today, French nuclear company AREVA said it expected to post operating losses of about 1.4 to 1.6 billion euros in its 2011 year-end financial report, including a cash flow loss, before tax, of about 1.8 billion euros. In response, the company will present on Tuesday in Paris its “Action 2016,” a strategic action plan for the coming years that is intended to turn the company’s losses into gains.
“Considering the expected growth in electric consumption, AREVA is convinced that the outlook for nuclear and renewable energy development remains strong in the coming years, even if expansion of the global installed base of nuclear reactors is postponed to a certain extent compared with forecasts available before the Fukushima accident,” said AREVA’s CEO Luc Oursel in a statement.
To reach its goal of performance improvement by 2015, Areva said it will reduce operating costs by up to 1 billion euros annually by 2015 (about 10% of the company’s cost basis) and will propose at its next General Meeting of Shareholders a 20% reduction in employee compensations beginning in 2012. AREVA executives have already announced that they will waive their right to bonuses for the time-frame of mid-2011 to the end of the year.
In its Vital Signs report, Worldwatch Institute noted that regulatory and market changes were not alone to blame for the downward trend nuclear power has been seeing. Instead, the sheer expense of nuclear power is also to blame.
But in its statement AREVA was hopeful that as global markets continue to grow and increase power consumption, nuclear power will bounce back and grow as well. It’s objective is organic growth of 3-6% annually in nuclear power from 2012-2013.
Because AREVA also sells other forms of renewable energy, the company’s come back may be from its non-nuclear power sources. It expects to see revenue of about 1.25 billion in euros from its renewable energy business by 2015, AREVA said.
Photo Caption: Rescuers attend a simulation exercice of a nuclear accident at the Areva nuclear plant in Beaumont-Hague, northen France, on December 8, 2011.