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Macron vows to “regain control of our power prices”

Electricity

26 Sept 2023 10:10

26 Sept 2023 10:10

(Montel) French president Emmanuel Macron has promised to rein in power price volatility for consumers when he presents a draft framework in October, following last year’s crisis that had spiked European wholesale prices to record highs.

“In October, we will be able to announce electricity prices… and will regain control over our electricity prices by the end of the year,” he said late Monday when presenting a plan to achieve a 55% reduction of net carbon emissions by 2030 compared to 1990.

“Because we have nationalised [utility] EDF and are fortunate to have a nuclear power base, we will be able to announce electricity prices in October that will give households and industrials visibility and put us in a favourable position at the European level,” Macron added.

He did not give any details on the nature of the measures that would be announced, however EDF and the government have been embroiled in negotiations on a new regulation for the sale of nuclear production, which could take the shape of a price cap or a contract for difference (CFD).

Long-term plan

The idea was "to put in place a long-term system that would make it possible to keep [power] prices among the lowest in Europe, while preventing the price spikes we have seen in recent months," said energy minister Agnes Pannier-Runacher in a press briefing on Friday.

The new power regulated prices would be “in orders of magnitude of EUR 60-70/MWh,” said an official source under the condition of anonymity. This would reflect the fact that the French power mix is nearly 90% low carbon with 63% of nuclear and 11% of hydropower last year, according to national TSO data.

Earlier this month, French energy minister Agnes Pannier-Runacher said the country would have a new framework governing the regulation of the sale of its nuclear power in place by the end of the year, without waiting for a European reform of the power market, Montel reported.

The current Arenh mechanism forces EDF to sell 100 TWh of nuclear output at EUR 42/MWh to rivals and is due to expire at the end of 2025.

Updates story published at 08:44 CET with quote from energy minister on the mechanism to control power prices.

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