The Minister of the Economy Bruno Le Maire announced an increase in the price of electricity on February 1. An exit from “whatever it takes” strongly criticized by the opposition, a few days before Gabriel Attal’s general policy speech.
“Audacity, more audacity, always audacity” declared Emmanuel Macron during his press conference on January 16. So, has the Minister of the Economy been bold? This Sunday, January 21, Bruno Le Maire announced on TF1 an increase in electricity prices on February 1, 2024 of 9.8% for households during peak/off-peak hours and of 8.6% for the base rate. The increase will be staggered from 5% to 8% for businesses. This increase is due to the return of the domestic final consumption tax on electricity (TICFE), frozen until then. It is currently 1 euro per MWh, compared to 32 euros before the crisis. On February 1, it will increase to 21 euros per MWh before being reevaluated on January 1, 2025 to reach the 32 euros MWh before the tariff shield.
An increase “under 10%” as he had promised. Announced at prime time during the 8 p.m. news, this bad news for French households is however not a surprise, the tenant of Bercy had not failed to prepare the French for this exit from the tariff shield, in place since 2022. If “France will keep electricity bills among the lowest in Europe” as indicated by the Minister of the Economy, the pill may be hard to swallow.
The increase will bring 6 billion euros to the State this year
After the last three increases, +4% in February 2022, +15% in February 2023 and +10% in August 2023, the total increase over two years therefore reaches 43 to 44%. “We are two-thirds of the way, but not all the way, in restoring the full extent of this tax says BFMTV. According to the Minister of the Economy, the tax will bring in 6 billion euros to the State this year, while an immediate return to normal would have brought in 9 billion euros. “We have protected a lot, we are returning to normal. We must also improve our public finances because if tomorrow there is a pandemic or another crisis again, we will be very happy to be able to protect the French, employees and businesses” he indicated.
“We all collectively spent more than 40 billion euros to pay the gas bill and the electricity bill of the French during the inflationary crisis, no other country has done that.” A way for Bruno Le Maire to justify his categorical refusal to freeze prices in February 2024. There are also “needs in hospitals, schools and public services,” he adds. For his part, Emmanuel Macron also justified this position during his press conference: “France has protected a lot against inflation in recent years. So, at a time when electricity price return to normal, it is legitimate that there are indeed increases” he explained. Part of the energy prices also serves to finance the government’s nuclear program, as indicated by the Head of State the same evening. The construction of six new new generation EPR reactors is already planned.
Freeing Gabriel Attal from a weight
While consumer prices increased by 0.1% in one month and 3.7% over one year in December 2023, the French will therefore see their electricity bill skyrocket from next month. This announcement from Bruno Le Maire was inevitable, and the timing was not chosen by chance. It is in particular a way of freeing Gabriel Attal from a certain pressure, eight days before the delivery of his general policy speech (DGP), on January 30. This week, the Constitutional Council must also deliver its conclusions on immigration. In short, this is the first hot topic to be addressed by the government, ahead of one, or even several, eventful weeks.
Jordan Bardella (RN) castigates the government
This announcement did not fail to provoke a reaction from the opposition and in particular the president of National gathering, Jordan Bardella a stone’s throw from the European elections. As a reminder, he is the head of the RN list. “Bruno Le Maire confirms the increase in electricity prices, from February 1, for all French people. Gabriel Attal’s first action as Prime Minister is therefore to cut purchasing power from our compatriots in a period of great difficulty” he declared on X (ex-Twitter) Sunday morning. “If electricity prices have soared, it is because Vladimir Putin, Marine Le Pen’s friend, attacked theUkraine“. Bruno Le Maire had apparently anticipated the reactions of the RN as soon as he spoke on the set of TF1 this Sunday. For his part, the national secretary of the PCF Fabien Roussel simply called for “the freezing of invoices!”.
The “France of the blind spot” without solution
“We will be below 3% inflation in 2024” declared Bruno Le Maire at the microphone ofEurope 1 last December. Problem is, the French do not see the end of the tunnel and this promised drop in inflation. With an increase in the price of electricity from the start of the year, is the government really making the middle classes its priority? “The France of the blind spot” as Emmanuel Macron called it during his press conference, stuck between the precarious who benefit from aid and the upper classes. Hard to say. One thing is certain, anger is brewing in the country. Strike by teachers’ unions on February 1, regular movements on immigration, large-scale actions by farmers particularly in the South-West… The audacity demanded by the Head of State could turn against him.