The OL3 nuclear European Pressurized Reactor (EPR), being built by French nuclear giant AREVA at Olkiluoto in Finland, is in such desperate financial trouble it has single-handedly wiped out the company’s half year profits.

The company’s operating profit is down by 97 per cent and net profit is down by 79 per cent – all thanks to the disastrous Olkiluoto EPR project. Facing up to the realities of nuclear reactor construction – the only true answer to the question ‘how much does a reactor cost?’ being ‘we’ll tell you when it’s finished’ – AREVA CEO Anne Lauvergeon has finally admitted that it is impossible to predict the final cost of OL3.

When the OL3 project was presented to Finnish government and parliament for (an ultimately positive) decision, TVO said the cost would be EUR 2.5 billion. The contracted fixed budget was EUR 3.2 billion. After years of schedule overruns, safety violations, and thousands of construction defects, the cost of this so-called state-of-the-art third generation reactor - one of just two being built in the world right now – now stands at EUR 5.5 billion. The counter above shows just how much OL3 is over schedule and over budget. To think AREVA describe EPR as ‘a cost effective reactor’.

The profit announcement has resulted in another very public argument between AREVA and the reactor’s owners, Finnish utility TVO. AREVA are demanding TVO help carry some of the financial burden (one billion euros and counting) – despite OL3 being a ‘turnkey’ project with a fixed price – and are threatening to suspend construction until the original contracts are modified.

So now Areva starts blackmailing its Finnish partner in an attempt to force it to cover at least some of the massive cost overrun. Anne Lauvergnon said that Areva will not commence with some of the construction unless TVO agrees to modified contracts. So far, it seems these threats have been made only in the media as TVO says it has not been informed about ‘discontinuing work or presented any conditions for the continuation of work on the OL3 construction site’

The countries – China, UK, US, India, Italy and others – looking to build their own EPRs are surely watching closely. How must potential investors be feeling, watching a reactor builder refusing to complete construction unless contracts are changed in its favour?

The real losers in this are of course Finnish electricity consumers (who face higher bills) and French taxpayers (AREVA is 91 per cent owned by the French state). In other words, the OL3 EPR reactor cannot be completed without massive public subsidies.

Arrogance and a misplaced faith in its own abilities have brought AREVA to this position. Like the rest of the nuclear industry, the EPR reactor is a dangerous and failing experiment (the other EPR being built at Flamanville in France is also hugely over budget and behind schedule, and has seen the same construction problems as OL3). EPR is massively expensive, untried and untested, and a block to the real and urgently needed solutions to climate change – renewable energy sources and energy efficiency programmes.

EPR is unaffordable both financially and environmentally. Construction Olkiluoto must be abandoned.