Electricity prices: a production price cap in France?

Electricity prices a production price cap in France

ELECTRICITY PRICE. The price of electricity production should be capped at 180 euros per MWh as part of an amendment to the 2023 finance bill. In France, the increase in tariffs could cost 20 euros more each month.

[Mis à jour le 10 octobre 2022 à 10h06] A new amendment to the 2023 finance bill (PLF) should allow the government to cap the price of electricity production at 180 euros per MWh. The objective is clear, to help businesses and communities that can no longer make ends meet with the announcement of the increase in energy prices. The executive should recover the difference between this new ceiling and the wholesale market price, so as to finance aid for businesses and communities. In total, between 5 and 7 billion euros should be collected.

As a reminder, the debates concerning the finance bill start this monday october 10 in the National Assembly. Enough to hope for more support for the companies most in difficulty. In France, the price of electricity will increase by 15% to February 1, 2023, which will represent an average increase of 20 euros per household and per month, as announced by Prime Minister Elisabeth Borne in September.

The price of electricity soared in France during the month of August, exceeding 1,000 euros. Direct consequence: the customers of alternative suppliers find themselves trapped by this unprecedented increase because these famous suppliers are subject to the wholesale price, and its impressive fluctuations which sometimes represent up to 50% additional per invoice and per customer. These suppliers are not modeled on the regulated tariff. Result of the races: if you sign a contract with this type of energy supplier, you risk paying the increase at a high price. Be aware, however, that a solution exists to overcome this kind of extreme situation: the principle of reversibility. In other words, you have the option of returning to an incumbent supplier, at the regulated rate, by making the request to a supplier such as EDF.

This increase in the wholesale price of electricity can be explained by the temporary shutdown of 32 French nuclear reactors and the insane rise in gas prices. If next winter turns out to be particularly cold, restrictions may be put in place, but “they will not concern households” as Prime Minister Elisabeth Borne said on France Inter on September 2 after the Defense Council on energy security. Agnès Pannier-Runacher also made it clear that the French energy giant “EDF has undertaken to restart all the reactors for this winter”. That is to say the 32 reactors currently shut down, enough to take the measure of the exceptional situation in which the country finds itself. The President of the Republic Emmanuel Macron spoke from the Elysée Palace on Monday, September 5: “The price on this European electricity market must be formed in a much more coherent way and in connection with production costs. The price of electricity on the European market is far too dependent on marginal contributions, in particular those of gas at times of peaks, which means that you have an electricity price that is disconnected from the reality of the costs of production.”

Will this spike in wholesale prices have a real impact on your electricity bill? Not really. For the time being, customers of incumbent suppliers like EDF are covered by the tariff shield put in place by the government. In other words, the increase in electricity prices is capped at 4% until the end of 2022. We advise you to favor these offers indexed to the regulated tariff, like EDF, it is set by the authorities. public. The prices set by the State via the “EDF blue tariff” (regulated) are available here. Be careful all the same, electricity prices will increase by 15% in February 2023 as announced by Elisabeth Borne on September 14.

As announced by the government on September 21, the price of electricity will increase significantly from February 2023 with a 15% increase. This price hike should represent around 20 euros more, each month, on your bill. A surge in energy prices that the government has already tried to contain with the extension of the tariff shield beyond the year 2022. This tariff shield, which made it possible to contain the rise in prices up to 4%, will increase to 15 % from 2023, gas prices are also affected from next January.

In an attempt to help the most modest households, the government has also decided to set up a brand new system: an exceptional energy check. This check will be added to the traditional energy check, but before the end of 2022 to offset the effects of the rise in the cost of living. 12 million households are affected. On the European level, the Prime Minister declared that “only sobriety and European solidarity will allow us to avoid rationing during a harsh winter”. Another way to save money: MaPrimeRénov’. It is an aid for energy renovation offered by FranceRenov , calculated according to your income and the ecological gain of the work. Pellet boilers, heat pumps and the insulation of walls from the outside are particularly taken into account by the device.

As of August 1, electricity prices have already been revised upwards. This increase is due to the evolution of the TURPE (tariff for the use of the public electricity network), a tax which aims to ensure the maintenance of the network and its modernization. The average increase is 0.91% for MV/LV consumers. It is 1.39% per year for the TURPE 6 period (2021-2025). HTB consumers, they show an increase of 1.09% and 1.57% per year. Has your electricity consumption jumped in recent months? It must be said that with successive confinements, sometimes cooler temperatures and teleworking, there is enough to increase the final bill. In this context, are you looking for alternatives to pay less? Linternaute.com directs you to its dedicated file in order to compare electricity prices :

At EDF, you have the choice between regulated tariffs and the market offers. In the first scenario, as explained above, prices are set by the public authorities. EDF offers three distinct offers: a basic offer (where the price per kWh remains the same whatever the time and frequency), a peak-off-peak offer (where the price per kWh is more advantageous between 10 p.m. and 6 hours) and a so-called “Tempo” offer (where the price per kWh varies according to the time of day and the days of the week).

The latter corresponds to households with “an electricity subscription of at least 9 kVA [et qui disposent] of an alternative mode of heating, such as heating with wood for example”, explains one on the site of EDF. To find out about EDF’s market offers, visit the website. Would you like to know more about how electricity prices are calculated? We answer your questions. Are you looking to change supplier in the current context? Consult our dedicated file before you start:

If we trust the latest Eurostat data, the price per kWh in France will reach 0.1946 euros in 2021, which is much lower than the average for the 27 countries of the European Union (0.2203 €/kWh). The tariff is much higher in countries such as Germany (€0.3193/kWh), Denmark (€0.2900/kWh) and Belgium (€0.2702/kWh).

* OlaWatt is a site of the Le Figaro-CCM Benchmark group, like Linternaute.com

It can sometimes be very difficult to tell the difference between the different offers on the market, as there are so many parameters to take into account (read above).

You can also go to the website of the national energy mediator: energy-info.fr. In particular, you will find a comparator, here, in which you must specify your current tariff option, the power subscribed and your electricity consumption. UFC-Que Choisir also offers a comparator, here. You will then obtain an informative list of the most advantageous offers according to your profile. When you compare offers, always bear in mind the power you subscribe to, the type of pricing you want and your annual consumption (expressed in kWh).

Are you looking for another comparator? Olawatt by BeMove* also offers a comparison tool. You must enter your address, as well as your annual consumption and then your contact details to receive a summary of your request.

Are you looking to undertake energy renovation work in your home? Do you know My Prime Renov’? This system was put in place last year to replace the energy transition tax credit (CITE). Since January 1, this famous bonus concerns all households, regardless of their level of income. The amount of financial assistance, paid at the end of the work, depends on the household’s resources, the location of the accommodation and the nature of the work. To find out more, see our dedicated article:

In addition to taxes, the price of electricity that you will pay depends on multiple factors. Linternaute.com summarizes the criteria for you:

  • The subscription you take out, whether it is EDF regulated tariffs or a market offer : you generally have the choice between two contracts, a basic rate and a peak-off-peak offer. In the first case, the price kilowatt-hour (kWh) of electricity remains the same. In the second scenario, it evolves according to consumption peaks. Clearly, it is cheaper at night, between 10 p.m. and 6 a.m.
  • Your consumption: lighting, household appliances, computer, television, internet installations… All of this equipment consumes energy, even if it is on standby! You are looking to reduce your consumption. Check out our article: Saving electricity: our advice
  • The power of your electric meter : 3,6,9 or 12 kilovoltampere (KVa).
  • The offer: the prices are obviously not the same from one supplier to another.
  • The frequency of invoicing : it goes without saying that it can have an impact on the final invoicing. If you use your equipment more in winter, for example, this will inevitably affect your bill.

Would you like to know more about what makes up the price of electricity? Consult our dedicated file:

Total, Direct Energie… What alternatives to EDF?

Are you looking to leave EDF’s regulated tariffs? You are not the only one: every month, 100,000 customers say goodbye to them, according to the Energy Regulation Commission. By changing supplier, large consumers, who consume 8,000 kWh, can save “a hundred euros” per year, according to 60 million consumers in its October 2019 edition. Total Direct Energie, Eni, Happ-e de Engie, EDF… Whether you are leaning towards a market offer or regulated tariffs, you can find all the offers online.

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