France's Energy Elite

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CoalEl Nio effect divides analysts

World CupConcerns over Brazil power rationing

Nordic power surplusMeagre years ahead for producers

Vol 13 No. 2, May 2014

ExClusivE: Frances energy elite Frances elite corps of technocrats is stubbornly clinging onto nuclear power and restricting the growth of renewables in the country.

Cracks emerge in French elites stranglehold on nuclear power The power held by a core of unaccountable technocrats is under threat.

By Chris Eales and Richard sverrisson [email protected]

In France nuclear power is synonymous with the state. However, behind the government lurks a secretive but highly powerful network of technocrats drawn from the Corps dEtat, a uniquely French system. Most prominent in strategy, developing and implementing energy policy is the Corps des Mines.

so strong is the tie between state and nuclear as espoused by Corps graduates, or X-Mines, as they are referred to, that to criticise nuclear policy in France has been akin to an act of betrayal. Its like the flag, says Bernard Laponche, a former French environment minister adviser. You cannot be against the flag, you cannot be against nuclear.

Green campaigners and opponents of nuclear power see the Corps des Mines as a dark, closed elite. They say Frances energy strategy and key decisions are decided by unaccountable and publicity shy engineers placed in key posts throughout the energy industry and in ministries.

They are more powerful than the government, says Laponche, member of Global Chance (NGO), former adviser to environment minister Dominique Voynet in 1999, comparing the role of the Corps des Mines to the English nobility in the Middle Ages. Its very feudal

and not democratic at all. They are the nuclear techno-bureaucratic dictatorship in France.

France is a centralised country run by a very closed shop of elites to whom nuclear is a religion, says Claude Turmes, vice-chair of the Green group in the European Parliament.

it is a very strange system, says Mycle Schneider, an independent nuclear consultant. It is similar to Opus Dei in the Catholic Church. A lot of people think Opus Dei is a sect, but it is part of the hierarchy and an official order. The Corps des Mines is an official part of the system of the French state. It acts like an underground system.

The dominance of the Corps des Mines has also held back the opening of Frances wholesale power market and strongly defended its own national champions, say experts. The elites have slowed down the development of liberalisation in France. Thats a fact, says Fabien Roques, consultant at Compass Elexon.

Within Frances centralised, Jacobin structure, where all decisions flow from the core Paris the engineers became responsible for attempting to transform the country from a dependence on oil to

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atomic power. Their heyday was in the centrally planned economies of the 1970s and 1980s during a time when energy nuclear was a given, and not a matter for political debate. Corps graduates played a key role in the launch of Frances huge nuclear power programme under the government of Pierre Messmer in 1974.

The programme, which saw the country build 80% of its current nuclear fleet over just 10 years from 1977-1987, went ahead, in the name of energy independence and national prestige, with no real debate with a discussion in the lower house only taking place once the programme had been launched, says Aurelien Evrard, lecturer in political science at Paris-based Universit Sorbonne Nouvelle.

The ties between Frances elite and nuclear goes as far back as Charles De Gaulle. Under De Gaulle, when Frances nuclear policy was conceived, these elites were entrusted to carry out its programme in this very French system, says MEP Turmes.

As well as holding key positions in industry, the X-Mines are also prevalent in regulatory authorities, ministries and the office of the prime minister and president. Currently, EDF is the only major French energy company that does not have a Corps des Mines engineer on its board of directors. However, it still contains a strong delegation who manages the firms strategy, renewable energy deployement, power production and tariffs. While the boards of Total and GDF Suez contain several Corps des Mines, their CEOs are not engineers. The head of Total is not X-Mines that would have been unthinkable 30 years ago, says a graduate of the elite Corps, who wished to remain anonymous.

Proponents of nuclear energy argue that the core competency and expertise of the engineers are essential for the French energy system.

Pierre-Franck Chevet, the head of Frances nuclear safety authority (ASN) and X-Mines says it is a special organisation dedicated to technical, industrial challenges. There are a lot of engineers because you need to talk about technical matters to try to be competent. So at the end it is quite normal to find experts in such technical matters.

While X-Mines remain highly influential and hold many powerful roles within industry and the French civil service, their stranglehold on the nuclear behemoth may be waning.

Some experts argue that Frances nuclear marriage spanning 40 years and 58 reactors has soured and that the relationship is on the rocks. It is no longer taboo in France to talk about cutting back the use of nuclear power, says Arnaud Gossement, a Paris-based energy lawyer. For the first time ever, he says, the Corps des Mines engineers within the energy ministry have emerged from the shadows and talked openly about closing reactors. Not just one plant, but 20 units.

speaking at a lower house inquiry into nuclear costs in March Laurent Michel, who heads the Energy Ministrys Department of Energy and Climate and Pierre-Marie Abadie, who runs its energy arm said there might be no need for 20 of Frances 58 reactors by 2025 under president Francois Hollandes plan to cut nuclear use to 50% of French power consumption by then.

Michel and Abadie, both X-Mines, said their calculations were based on an only relatively moderate rise in power demand to 2025. Theres no doubt that when important people like this speak in the lower house, they weigh every word. So it is a declaration. And it effectively illustrates a change in culture, says Gossement. In the past we have been used to a [state] administration that blocks political decisions. But this is not the case here.

Laurent Michel Director general, energy and climateRichard Lavergne Adviser to the director general, head of operations energy climate strategyPierre-Marie Abadie Director of energy*Ministry of energy, environment and sustainable development

Blaise Rapior Adviser, energy,competition and sectors policyChristophe Attali High Council for Economy, Industry, Energy and TechnologyFabrice Dambrine Head of innovation, competition and modernisation, High Council for Economy, Industry, Energy and Technology*Ministry of economy and finance

Corps des Mines in power

The technocratic elite of the Corps des Mines have prominent positions on the boards of Frances major energy firms, key nuclear power related institutions, and ministries. All names on the following pages are engineers from the Corps des Mines in such positions, though the list is nowhere near exhaustive.

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Stephane Dupre La Tour Head of renewable energy and energy access, strategy divisionFrancois GigerHead of strategy , director of CO2 programmeCecile Laugier Director of SEPTEN, nuclear engineering design departmentMichel Matheu Head of EU strategy, public affairs division

Laurent MichelMember of the board (French government commissioner) Didier Holleaux CEO, E&P internationalBruno Bensasson Member of the boardIsabelle Kocher Executive vice-president, chief financial officerRaphael Schoentgen President of GDF Suez, China

Luc Oursel CEOPhilippe Knoche COO, member of the boardAlain Bucaille Adviser to the chairman, future of energy and strategy

Thierry Desmarest Honourary chairman, member of strategy and governance committeesPatrick Pouyann President, refining & chemicals, member of the executive committeeBertrand Collomb Member of the board

And there are those within the high echelons of the state who appear to have decided that it is now acceptable to have a debate about nuclear power. Nuclear energy must be the object of a debate in civil society, says Francis-Rol Tanguy, who is currently energy advisEr to French energy minister Segolene Royal, and member of rival elite Corps, the Corps des Ponts et Chaussees.

There is no shame in that but all those who built nuclear power in France, and its true that is a fairly extraordinary adventure, have a little difficulty in accepting this change because up until now it was a subject that was decided, well, elsewhere by an ensemble of technocrats, the state, the milieu of research, the CEA (Commission of Atomic Energy), there was a kind of delegation on this subject, he adds.

indeed, Frances so-called energy transition debate, launched by the Hollande presidency last year, is the first time in French history that there has been a broad consultation on energy policy. In the past, it was always top down, non-transparent, says Fabien Roques, senior vice president at Compass Elexon, a consultancy firm.

If the doors of the elite are now opening to debate, this is because technocrats are aware of the rising costs of generating nuclear power and the possibilities of cheaper alternatives, experts argue. The melt-down at Japans Fukushima nuclear plant in March 2011 raised the safety bar for French reactors and this combined with the costs of keeping ageing reactors in service means the French administration is conscious that nuclear will soon be very, horribly expensive, says Gossement.

indeed, some elements of the Corps des Mines are beginning to see that offshore wind and large-scale solar are cheaper than new

nuclear, says Claude Turmes. This view is shared by others in the green energy sector. Renewables are now taken seriously by the technocracy, says Jean-Louis Bal, chairman of Frances renewable energy industry lobby SER.

Every day there is 250 MW of renewable capacity installed across the world thats the equivalent of a European pressurised reactor every week ... It is the global context that is changing the mentality on renewable everywhere in Europe, he adds.

it is also a shock for the engineers that the (European power pres-surised reactors being built) at [Finlands] Olkiluoto 3 and Flamanville are so over budget, which explains the strike price achieved at the UKs Hinkley Point reactor. The technology is not competitive anymore, adds Turmes.

Others see it differently, arguing that cracks in French nuclear policy are much closer to illusion than reality. Even if nuclear power has become a subject of debate it does not follow that the mentality of the policymaking elites has changed, says Evrard. Technical elites do not need to keep decisions away from democratic debate they influence the framework of that discussion.

There is a thin veneer of democracy, he adds, referring to recent debates regarding renewables. There are debates that are organised, such as the French parliament debate in 1999 and a national debate in 2003. These are supposed to be collective discussions about energy issues, but the core decisions are never taken in them.

He highlights the Grenelle de Lenvironment , a series of political meetings on the environment held from 2007 to 2012, where discussions lasted over 2,000 hours and did not cover nuclear power. A decision on concrete policy implementation, however, was taken elsewhere in

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PARISCorps des Mines

Paris Mines Techgraduate school

(X-MINES)

French Presidential Palace

EDF

TotalAREVA

GDF Suez

MINEFMinistry of Economyand Finance

CEANuclear Energy Directorate

ASN Nuclear Safety Authority

IRSNInstitute for Radiological Protection and Nuclear Safety

MEDDEMinistry of environment, sustainable

development and energy

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PARISCorps des Mines

Paris Mines Techgraduate school

(X-MINES)

French Presidential Palace

EDF

TotalAREVA

GDF Suez

MINEFMinistry of Economyand Finance

CEANuclear Energy Directorate

ASN Nuclear Safety Authority

IRSNInstitute for Radiological Protection and Nuclear Safety

MEDDEMinistry of environment, sustainable

development and energy

the elites, says Evrard. Once again the administration took back the decisions from the people that participated in the debates, he says. As far as implementation of the core aspects of energy policy is concerned, the administration decides and does so outside the debate.

And the technocrats still wield power with no change in the administrations centralised way of thinking about energy production, say critics of the system. This policy is still technocracy led. The way of thinking that this is too complicated for people has not changed, and the main actors are the same and the economic context is even more difficult, adds Evrard.

The modus operandi of the elite engineers is firmly entrenched in the workings of the French state. The key aspect of the Corps is that it does not function as an old boys network, but that the positions belong to the Corps, says Schneider. When an X-mines leaves a position, the ministers can chose from a selection of X-Mines CVs to replace him/her, he adds. For instance, when X-Mines Anne Lauvergeon left nuclear engineering firm Areva, she was replaced by Luc Ourson, who was also a Corps des Mines engineer, says Schneider.

Similarly, when X-Mines Andre-Claude Lacoste finally departed the ASN, he was replaced by Pierre-Franck Chevet, another X-Mines. Thats the key to the system. It is to perpetuate a strategy beyond electoral thinking or changes beyond that horizon, he says. The dynasty must carry on even if it means assigning senior roles to young engineers.

While many industry heads achieve lofty positions in middle age, Corps des Mines engineers are offered senior roles at quite a tender age. It is a problem that they are so young and they get into very serious positions, says Schneider. This view is confirmed by an X-Mines. At the age of 22, you could talk to any plant manager you wanted, he says, also questioning the suitability of the engineering elite to run energy policy in the 21st century, where governments see combating climate change and competitiveness equally important as security of supply.

Why would members of the [elite] who were by far the best at calculus at the age of 15 to 18, also be the best qualified to run energy companies and even define energy policy? asks the anonymous engineer.

The technocrats do not tolerate heresy against the nuclear religion. During his time in the Atomic Energy Commission (CEA) from 1962 to 1972, Bernard Laponche was also active in the CFDT union that spoke out against nuclear. We had a position [in the union] against nuclear and the head of the CEA at the time, was furious because we were speaking to the press, when he said this was an internal discussion and not for members of parliament, or journalists.

Members of this corps are under huge pressure not to deviate from its policy, or even leave it, says Turmes. Individuals would risk their career if they broke out from the nuclear religion as they would not find an equivalent position or the same social recognition.

indeed, president Hollandes aim to cut nuclear use to 50% of demand implies a policy of closing 20 reactors and challenges the traditional way of thinking in the Energy Ministry. Their readiness to reach this target then comes into doubt, says Evrard.

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For X-Mines Vincent Le Biez, who is national secretary of Frances UMP opposition party the fundamental problem with Hollandes nuclear power policy is the goal of cutting to 50%. It makes no sense.

Its strange to say we have to close more or less plants depending on the consumption in 2025. We are not going to close plants that are perfectly safe and profitable for the pleasure of closing them, he adds.

The recent comments by X-Mines Energy Ministry civil servants in the lower house, says Le Biez, are simply a response to Hollandes 50% aim , which has become a symbolic figure due to a pre-electoral agreement with the Green party.

As a result we are forced to try and interpret this figure and to say what this might represent. I dont think that spontaneously the administration would suggest this kind of reasoning. I am not sure you can interpret this as a change in mentality. What has changed is that there is now a consensus among the technocracy that the reactors, whatever their expected running lives, cannot all be closed at the same time, he says.

This has to be done gradually over time, otherwise it will cost far too much, but, according to Le Biez, there is no urgency to address this issue now. He also bats away the idea economic constraints and nuclear accidents are provoking a rethink of power policy in France. There was a doubt among Corps des Mines engineers after Fukushima but this has lifted because of the situation in Germany where the exit from nuclear power use has left the countrys commercial balance in great difficulty, according to Le Biez.

We must be very careful about altering Frances energy policy. I think this is a majority view among engineers in the administration. France has put so much into nuclear that it would be a very heavy economic choice.

The country is unlikely to follow Germany in transforming its energy system, at least in the short to medium term. The rapid growth of de-centralised renewables as has occurred in Germany is not possible in France, says Roques of Compass Elexon. The Germans have gone in for self-investment its been a bottom-up development, such as rooftop photovoltaic panels. In addition, the Green party has played a much larger role in shaping the publics mind [in Germany].

The energy transition in France is anything but a transition, says Evrard. He points to Denmark and Germany, where citizens co-operatives and local communities have built renewables. Renewables growth there has been decentralised but most importantly, decisions have been reached more openly, he says.

Evrard again highlights the role played by the elites in thwarting change. The key areas between the two countries are the differences between the institutional frameworks. In Germany, renewable legislation in 2000 and 2004 was led through parliament, he says, adding that such an outcome would be unfeasible in France.

France will obviously not be able to copy Germany, says Francois Leveque, professor of economics at Mines Pairs Tech. It is not possible to close all 58 nuclear reactors in France.

Proponents of nuclear power argue that replacing only some plants with renewables will be prohibitively costly. The energy transition will increase electricity costs as much as 70% by 2025 for large firms and therefore hurt companies ability to compete globally, says Colette Lewiner of Cap Gemini.

Investments needed from now to 2020 are forecast to be between EUR 350-415bn, she says, adding half of which are grid investments. Lewiner cites a 2011 study by Alfred Voss of Stuttgart University, who estimated the energy transition cost for Germans at more than EUR

Dominique Maillard CEOClaire Niclot Director, innovation and RTE and EDFVincent Thouvenin Executive director of SENP (power system unit)

Daniel Bouche Director of researchJean Cazalet Deputy director for development and nuclear innovation, nuclear Energy departmentEric Goubault Research director*Nuclear energy directorate

Pierre-Franck Chevet PresidentJean-Jacques Dumont CommissionerSophie Mourlon Deputy director generalThomas Houdre Director, nuclear power plants*Nuclear safety authority

Patricia de Suzzoni Adviser to the chairman*Energy regulator

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The hidden French energy elite

In many countries, the governing and i ndustrial elites are formed of lawyers, doctors or graduates of the most prestigious universities. However, in France these positions are held by engineers from the Corps des Mines.

The institution, attached to the ministry of economy and industry, recruits the top dozen graduates from Frances Polytechniques and other prestigious schools, including the countrys Grandes Ecoles. They are classed 1- 10 accord-ing to their grades, says a former teacher at the Corps. They are considered not only as the elite but the elite of the elite.

Once in the Corps des Mines, they actually no longer do any science, the teacher adds. They study administration, technology and engineering business, he says, adding that the students move very rapidly completely out of the science domain.

They have two years of what amounts to an internship. There are no courses of any kind. They spend a few months in industrial intern-ship, and they do that two or three times and then they are engineer des mines and they are appointed administrative positions.

They gain promotion very quickly, and often assume large responsibilities at a young age.

The Corps engineers are granted a job for life, either in prominent leadership or advisory positions in global French giants such as EDF, GDF Suez, Total and Areva and/or in most government ministeries. There are 800 members, but only about 500 are active.

The Corps des Mines has a long history, and was established in 1810. In terms of energy policy, it rose to prominence when the government of De Gaulle entrusted the elites to carry out its nuclear programme, which has been seamless for the past 40 years. Only now are cracks in this technocratic closed shop beginning to emerge.

2,000bn, an amount comparable to that spent on German re- unification.Cutting the share of nuclear power in French consumption to 50%

by 2025 will cost EUR 592bn, Lewiner estimates.

There are signs that the Corps des Mines is changing. There is a difference between the younger and older generation, says Gossement. Today many young X-Mines work in wind power and solar companies.

Others share this view of transition to a new renewables-savvy vanguard. The younger X-Mines can see the new reality but the older ones are digging in, says Turmes.

France will see change, but it may take five or 10 years, says Roques, stressing that the direction is there. The renewables lobby agrees. The global context is changing the mentality on renewables everywhere in Europe. Its not going to be a brutal change in France its linked to the (nuclear) culture, says SERs Jean-Louis Bal.

France may yet be able to lessen its dependence on nuclear power, but this requires a massive change in mentality in the elites and for the old guard to step down or relinquish their grasp on the technology of a bygone age, say experts.

In France nothing will change unless the Corps des Mines changes or the 200-year old, outdated Corps dEtat system is finally abolished, says Schneider, adding that the elites are beginning to engage with scenarios that illustrate that something drastic has to happen. In the end, you cant keep saying the energy earth is flat, says Turmes.

Montel asked Jean-Louis Beffa, X- Mines, chairman of the association of Corps des Mines engineers to contribute to this article. He declined. Marie-Solange Tissier, joint director of Paris Mines Tech, responsible for the formation of the Corps des Mines, did not return phone calls. n