How to fit a circle into a square? In this case, it is necessary to preserve both the domestic budget and the competitiveness of business and the investment opportunities of EDF, weighed down by a debt of 65 billion euros, which operates 56 existing nuclear reactors and must also build six new EPRs. ? The answer is necessarily complex. The government, however, tried to provide it this Tuesday morning during a conference that brought together Economy Minister Bruno Le Maire, Energy Transition Minister Agnès Pannier Runacher, Industry Minister Roland Lescure and EDF CEO Luc Remont.
“This morning we concluded an agreement with EDF which guarantees a price of about 70 euros per megawatt hour (MWh), which corresponds to the total costs of producing nuclear electricity in France,” explained the Minister of Economy. This agreement will create a system that will be a continuation of the Arenh (Regulated Access to Historical Nuclear Electricity) system, which for almost twelve years required EDF to sell part of the nuclear electricity it produces at a lower price. (42 euros per MWh) to its competitors. This system will end in 2025.
“It was therefore necessary to plan a continuation starting from this point,” said Agnès Pannier-Runacher. What follows is both the agreement concluded a few weeks ago with the European Union, which separates electricity prices from gas prices, and the agreement we have just concluded with EDF. » A new device, which, however, is characterized by a certain complexity. “Once prices significantly exceed €70 per MWh, a rent collection mechanism will be launched for rapid redistribution to the consumer. This capture will be 50% (difference between the observed price and the reference price of 70 euros) from a threshold of 78 to 80 euros. Then 90% of 110 euros. »
What are the prices from 2025?
The new gas plant is therefore officially intended to protect consumers “from price volatility”, in the words of Bruno Le Maire, and allow the government to no longer create a new price shield. “What we have now should last until the end of 2024,” the minister recalled, “and it cost the state, and in the end more than 40 billion euros to the taxpayer. But thanks to him, in February next year the increase in electricity prices will be a maximum of 10%. Any other figures and forecasts are fiction. ” This agreement, which also follows the “renationalization” of EDF following a public offer of purchase (OPA) worth almost 10 billion euros, represents an energy plan “the most radical since the plan launched by Messmer in 1974”, according to Bruno Le Mayor. This plan allowed France to build its current nuclear fleet through an investment of 200 billion euros.
What about the evolution of electricity prices after 2024 and the end of the tariff shield? And even more after 2025 and the end of Aren? “A megawatt-hour of electricity at a price of 42 euros covered only a third of EDF’s nuclear power production,” the minister recalled. The rest depended on market volatility. There, all production will be affected by this new regulation with a threshold of 70 euros. »
This prevents. We are currently moving from cyclical inflation associated with the war in Ukraine and the low readiness of the nuclear fleet in 2022 associated with maintenance and corrosion issues, to structural and persistent inflation associated with the energy transition. In this impossible equation, there is only one certainty: in the end, no matter what protections the government introduces, not only households, but also businesses will suffer from rising bills and prices in general.
Source: Le Parisien
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