(MENAFN- AFP) The French government has reached agreement on paying compensation to state-owned energy giant EDF to shut down the Fessenheim nuclear site, the ministry of energy said Wednesday.
Paris announced in March that work would begin this year to close the country's oldest nuclear power plant in eastern France which at the centre of a row with neighbouring Germany and Switzerland.
"An agreement has been reached with EDF providing for staggered compensation with a first stage of 100 million euros ($114 million)," a ministry spokesman said.
A source close to the discussions told AFP that a second "fixed" payment of 300 million dollars would be made meaning EDF will receive at least 400 million euros.
The ministry spokesman said several payments would follow the initial one, their schedule depending on several factors including the price of energy in the coming years.
In May the government initially offered around 100 million euros in compensation, but EDF, which did not initially comment on Wednesday's deal, had been holding out for more.
Fessenheim, a two-reactor site located just 1.5 kilometres (1 mile) from the German border, is France's oldest nuclear plant having been commissioned in 1977.
Nuclear power currently accounts for some 70 percent of electricity generation in France but the government is resolved to bring it down to 50 percent over the next decade.
Fessenheim, located on a seismic fault line, has worried French, German and Swiss environmentalists for years.
President Francois Hollande pledged to close the site in his manifesto ahead of his election in 2012. The shuttering of Fessenheim is due to go ahead by the time the new Flamanville 3 reactor on France's northwest coast comes on stream by 2018.
Wednesday's deal will be presented to the EDF board for approval on September 14.
With their agreement EDF chairman Jean-Bernard Levy will be able to sign it off, probably by the end of the year.
The government will then be able to finalise the closure.
France and Germany are close EU partners but have taken vastly different approaches to power generation.
Germany -- where the public mood swung against nuclear power following the 1986 Chernobyl disaster -- decided to phase out nuclear power following Japan's Fukushima meltdown in 2011.
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