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General view of the construction site of the third-generation European Pressurised Water nuclear reactor (EPR) in Flamanville, north-western France, January 17, 2013. French utility group EDF said it will start discussions with Chinese nuclear firm CGNPC about a partnership for nuclear projects in Britain, a top EDF official said on Thursday. REUTERS/Charles Platiau

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By Geert De Clercq

PARIS (Reuters) - Early this year, France's state energy and environment agency was set to publish a study that found the country could realistically abandon nuclear reactors and rely completely on renewable power in decades to come.

But the presentation was scrapped under political pressure, with Energy Minister Segolene Royal later saying the agency needed to be "coherent" with government targets.

The episode illustrated the tensions surrounding energy policy in a country steeped in nuclear power since the 1970s and which relies on it for three-quarters of its electricity - more than any other nation.

Any suggestion of abandoning the atom is unthinkable for many in France, where scientists played a key role in discovering radioactivity, atomic energy is broadly accepted by all major political parties except the greens and the nuclear industry employs 220,000 people.

Ahead of the U.N. climate change conference in Paris next week, the French position exposes the lack of any consistent European policy on how best to switch from polluting fossil fuels to cleaner energy and reduce carbon emissions.

In Germany, the 2011 Fukushima nuclear disaster led to an exit from nuclear and a massive switch to renewables, while many other countries also decided to phase out nuclear.

But French lawmakers in July voted only to cap nuclear capacity at current levels and to reduce its share in the power mix to 50 percent by 2025 - without announcing any concrete steps towards that goal. They also backed a government target for renewables to generate 40 percent of power by 2030.

The study by state energy and environment agency ADEME - tasked with leading France's energy transition - had found, by contrast, that France could switch to 100 percent renewable energy for power generation by 2050 at a cost similar to sticking with atomic energy for 50 percent of its power.

"We show that a hypothesis that most stakeholders thought was unthinkable, is actually technically possible," ADEME head Bruno Lechevin wrote.

The report was finally published in October - months after lawmakers had approved the government's energy transition law - and included a carefully worded introduction by Lechevin, saying it was "an exploratory scientific study, not a political scenario".

NUCLEAR VS RENEWABLES

France's heavy reliance on nuclear power means it is, in some respects, a model for low-carbon power generation, but that also makes it harder to consider a shift to renewable energy.

The nuclear industry argues world leaders at the COP21 conference in Paris next week should not have to choose between nuclear and renewables but between low-carbon energy - including nuclear - and fossil fuels.

"We were surprised to see that the draft COP21 documents do not mention nuclear energy at all as a solution to climate change," said Isabelle Jouette of French nuclear lobby SFEN.

But critics like Greenpeace say nuclear power - whose share of world electricity production has been stable at around 11 percent for years - cannot be part of any climate solutions put forward at the U.N. conference because of the risks related to reactor accidents and waste storage.

They also say building reactors is too expensive and slow.

"If we are going to spend a lot of money to tackle climate change, we have to do it in the most economically efficient way, which is renewables, not nuclear," said Greenpeace energy campaigner Cyrille Cormier.

Cost and timing have been the banes of the French nuclear industry in recent years. As costs for solar and wind energy have dropped dramatically in the past decade, the cost of nuclear has climbed as safety requirements have tightened.

EDF's Areva-designed EPR reactor in Flamanville - the sole nuclear reactor under construction in France - has seen its cost balloon from an initial budget of 3 billion euros ($3.2 billion) to 10.5 billion euros, while the two EPR reactors EDF plans to build in Britain's Hinkley Point are estimated to cost 12 billion euros apiece.

Once the great hope for a French global nuclear export drive, Areva has seen its equity wiped out by years of losses and its reactor division has been taken over by EDF.

EDF itself has seen its stock fall 37 percent since January and 83 percent from its 2007 highs as investors worry where it will find the billions to upgrade its ageing French reactors, build new ones and turn around the Areva reactor unit.

CHANGING COURSE

This is why the ADEME's 100 percent renewables study could be an existential threat to the company, which has lagged other European utilities in deploying solar and wind.

If France were to switch to 100 percent renewable energies to produce power by 2050 - 63 percent wind, 17 percent solar, 13 percent hydro and 7 percent other renewables - the average cost would be 119 euros per megawatt-hour, according to the study

That is nearly the same as the average 117 euros per MWh for a scenario with 55 percent nuclear and 40 percent renewables.

France's former monopoly power provider EDF - the world's biggest operator of nuclear reactors - could not disagree more with the idea of phasing out nuclear in France.

Its management has repeatedly said that any reduction in the share of nuclear in France's energy mix will not come from closing down reactors but from increased demand from new uses for power like electric vehicles.

Despite stagnant power demand in recent years and government policies to boost energy efficiency, EDF boss Jean-Bernard Levy said last month that France's nuclear capacity of 63.2 gigawatt may be a minimum, not a maximum, and spoke of building more than 30 new reactors to replace EDF's ageing nuclear fleet.

Lechevin - a former leader with the moderate CFDT union who started his career as an EDF warehouse clerk - said it was not surprising EDF still operated within a logic of equating economic growth with higher energy use.

"EDF is a big tanker, it takes time to change course," he said, adding that the firm might need a shove to become a driving force of France's energy transition.

Lechevin said his agency was neither for or against nuclear, but warned that EDF's strength in nuclear should not blind it to the opportunities in renewable energy and energy efficiency.

"France's strong suit is nuclear, but this can also be its weakness," he said.

(Editing by Pravin Char)

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