France will be able to get through the winter and meet the demand for gas and electricity on condition that it saves energy, the network managers hammered out on Wednesday, before the government’s announcements on possible tariff increases.
As a result of the war in Ukraine, Russian gas flows to Europe have dried up, leading to fears of shortages in the winter and a surge in market prices. However, it is the price of gas that drives the price of electricity.
In this context, the manager of the French gas network GRTgaz was keen to reassure Wednesday on the ability of France to “cope” with the demand for gas during an “average winter”, and this while developing its exports to Germany from mid-October. France, whose reserves are well filled, will however have to make an effort and save “from now on” in case of a very cold winter.
Earlier, in the morning on Wednesday, the manager of the French electricity transmission network RTE had also sounded the “mobilization” by calling on the French to make an effort of sobriety, facing a situation described as “exceptional”.
According to RTE, a “risk of blackout cannot be totally excluded”, but “it could be avoided by reducing national consumption by 1 to 5% in most cases, and up to 15% in the most extreme weather situations”.
In concrete terms, for companies, local authorities and individuals, this means reducing or postponing heating, lighting or cooking consumption, particularly during peak periods of consumption, in the morning between 8:00 and 13:00 and in the evening between 18:00 and 20:00.
In no case, France runs a risk of “black-out”, that is to say “the loss of total control of the electrical system”, also wanted to reassure RTE, while France is affected like the rest of Europe by an unprecedented energy crisis.
What rate increase?
France’s situation is weakened by the fact that its nuclear power production is at a low level due to work or corrosion problems on half of its 56 reactors. Even if EDF and its leaders reiterated on Wednesday that the shutdown reactors would reopen during the winter, once the maintenance operations are completed.
This “high level of risk” on electricity production cannot, however, “justify” the surge in energy prices on the futures markets, according to RTE, denouncing “a very costly risk premium” for France.
Faced with the soaring costs of electricity and gas on the markets, the Prime Minister Elisabeth Borne, surrounded by the Ministers of Economy Bruno Le Maire and Energy Transition Agnès Pannier-Runacher must announce from 15:30 the new contours of the tariff shield for 2023.
In 2022, the increase in electricity rates for individuals had been blocked by the government at 4%, and gas rates frozen at the level of October 2021.
The government, which is preparing its budget proposal for 2023, has promised that the increase in gas and electricity prices will remain “contained” for consumers after the shield expires on December 31, 2022. The question is how much of a rate increase will be applied, and what level of protection will be provided to the French.
According to Bercy contacted by AFP, “some will be helped to pay the increases”, which should be announced later today.
“If there was no tariff shield, it would be 180 euros more at the beginning of the year on the gas bill for the French and 120 euros on the electricity bill,” said the Minister of Economy Bruno Le Maire Wednesday morning on Cnews.
