Nuclear War

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Mychele Daniau / AFP / Getty Images

Fraternité? The EPR reactor under construction in Flamanville, France

Whenever the French are called on to justify their state-heavy approach to business, they can point with justifiable pride to what they call their filière nucléaire. This is the assortment of businesses that design, build and operate the 58 nuclear power plants that generate 75% of France's electricity. French President Charles de Gaulle willed the nuclear state into being in the late 1950s, and it grew up in his portentous shadow to become one of the brightest jewels in France's industrial crown. It has given the French, among other things, cleaner air and cheaper electricity than any of its neighbors have, not to mention an energy export worth nearly $4 billion annually.

France waited a long time for the rest of the world to warm up to nuclear power. Now that it has, the country is counting on seasoned nuclear veterans like the utilities Electricité de France (EDF) and GDF Suez and the nuclear plant designers and engineers Areva and Alstom to raise the tricolor atop reactors from Argentina (one reactor planned) to Vietnam (four reactors planned). Vinci and Bouygues, the construction giants that do much of the heavy lifting on France's reactor projects, would be expected to pour the concrete. With the world short of power, some 200 nuclear plants will be built (and another 300 are under proposal) in the next 20 years.

But in this global nuclear summer, France's prospects have cooled. Not only has the French industry suffered an embarrassing setback overseas, but its nuclear grandees can barely stand to look at one another, its new European Pressurized Reactor (EPR) — the only one on offer — is a Rolls-Royce in a Chevy economy, and the first two EPRs are taking longer to build and costing far more than anyone dreamed.

The French have even started to wonder whether the very Gallic attitudes that have shaped the country's glorious past — among them, a confidence in France's prowess bordering on arrogance — may impair its future nuclear success. The French have never been gifted team players — witness the fratricidal frenzy that engulfed Les Bleus, France's once champion soccer team, during the World Cup. In the past, the filière responded on command to the government for the glory of French industry. But in a more market-driven world, French companies have become even less amicable. "It's very difficult to change something that goes so deep," says an executive at a leading nuclear supplier. "We're in the middle of the stream between a very centralized system and a very diverse marketplace, and we can't waste time. The competition is here."

The competition is from the U.S., South Korea and Japan, and each can assemble consortia to deliver turnkey nuclear plants with greater ease than France's bickering companies. Without a strong guiding hand, France's filière has a tendency to unravel in chaos and acrimony, as it did recently over a job in the United Arab Emirates, where the French were vying last year for a $20 billion contract to build four reactors. The U.A.E. craved France's nuclear know-how from the outset. The contract was France's to lose, and lose it France did.

The first problem was EDF. The U.A.E. badly wanted the big French utility to run the whole show, but EDF wanted no part of a desert project in a developing country. Instead, the disappointed U.A.E. got a leaderless consortium comprising Areva, GDF Suez, Alstom and oil giant Total, a nuclear wannabe. By the time the French government forcibly dragged EDF to Abu Dhabi in December, it was too late. "It was like the village of the Gauls in the Astérix comics," says an executive. "It was a complete mess — a mix of clannishness, personal ambition and hatred."

Two weeks later, the U.A.E. announced that a consortium led by the South Korean utility Kepco had snatched the prize. "Korea was very well organized, which was not the case with us," says Jacques-Emmanuel Saulnier, an Areva spokesman. "In Abu Dhabi, we learned that we have competitors and that they're pretty dynamic."

The disaster in the desert exposed other cracks in France's nuclear core. The French built all their reactors in the previous century. From 2000 to '04, they built exactly none. "Imagine an airplane manufacturer that didn't make any airplanes for four years," says a French nuke executive.

Meanwhile, the South Koreans and the Japanese — ever wary of their dependence on imported oil — have been steadily turning out nuclear reactors. Kepco is constructing two of the APR1400 reactors it sold the U.A.E. "The Koreans can point to a good record of building on time and on budget," says Steve Kidd, director of strategy and research at the World Nuclear Association.

It was partly to put its nuclear hard hats back to work that Areva agreed to build its first new-model EPR in Finland, at cost, for about $3.8 billion. That's also largely the reason the French are building a new EPR at home in Flamanville, with a third planned at Penly. The French team badly needs the practice — particularly EDF and GDF, which have no role in Finland's Olkiluoto reactor. (Finnish utility TVO is the operator there.)

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