EDF shareholders have agreed to issue new shares in order to raise â‚¬4bn to help pay for the Hinkley Point C nuclear power plant.
French energy giants, EDF have announced that an agreement has been made between its shareholders to release a new round of shares, in order to raise â‚¬4bn (£3.4bn) to help fund the Hinkley Point C nuclear power plant.
The French state, which owns 85% of EDF will purchase â‚¬3bn of the shares made available.
This news has been announced ahead EDF's board meeting on Thursday, when the Hinkley Point project is expected to be fully approved. The scheme, to be constructed in Somerset will be the first nuclear power plant in the UK in decades, costing around £18bn.
EDF chief executive, Jean-Bernard Levy said: "We need to boost our equity as market conditions are tough and we need to maintain the quality of our debt and our credit rating."
Hinkley Point C was initially scheduled to be in operation by 2017 and would be capable of meeting 7% of the UK's electricity needs. However, concerns arose regarding EDF's capacity to finance the deal and the firm has come under fire from French unions. A third of Hinkley's £18bn cost will be provided by Chinese investment but experts continued to question whether EDF was able to deliver the resource-sapping project.
EDF claim the scheme is a "major element" of its low-carbon growth strategy, while the new UK Chancellor, Phillip Hammond says the government remains committed in constructing Hinkley Point.
The government has reaffirmed its backing of the project due to the rising cost to the consumer for electricity potentially produced at the power plant. A price of £92.50/MWh was agreed for the power Hinkley Point generates during its 35 year lifespan. This figure is over double the current wholesale price and the government would be left to make up this shortfall; causing some scepticism in its commitment to the project.