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France set for sharp rise in electricity prices

Dan MacGuill · 9 Jul 2013, 12:47

Published: 09 Jul 2013 12:47 GMT+02:00

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The first five-percent hike will come into effect on August 1st, Philippe Martin, France’s new minister for ecology and energy, announced on Tuesday.

This will be followed by another five-percent increase in August 2014. The rises are to help fill a gaping hole in national energy provider EDF's coffers.

For households using electricity to heat their homes, the sharp price hike is the equivalent of €35 to €50 on average on the annual bill.

Over the next five years, bills are set to rocket by 30 percent, according to a report in February by France’s energy regulator, the ‘Commission de regulation de l’energie’ (CRE).

French consumers, accustomed to one to two-percent annual increases in electricity price in recent years, will be bracing for the sharp rise in the cost of heating and running their homes.

Martin defended his decision to impose price rises spread over two years by saying it was being done to protect consumer spending power.

The government has decided to protect household spending power as much as possible by smoothing out over several years the rises needed to cover the EDF’s costs, as provided for by the law - See more at: http://www.connexionfrance.com/Electricity-bills-EDF-Martin-14853-view-article.html#sthash.8SYZGTo6.dpuf

However the announced price hikes have been criticized by France's consumer rights groups.

UFC-Que Choisir said it "bitterly regretted the cavalier announcement",and that it Martin ignored "the measures demanded by consumers."

The association demanded that the minister organized a "crisis meeting with all interested stakeholders".

Story continues below…

The unusually steep increase is however still lower than the 6.8 to 9.6 percent originally called for by the CRE, which has lamented France’s failure to fill a gap in the balance sheet of EDF, the world’s largest producer of electricity, which is based in Paris.

It’s not all bad news for French consumers, however. 

Energy minister Martin also announced on Monday that those with a low-power electricity set-up (three to six kilovolt-amperes) would enjoy a decrease in prices, though that decrease was not detailed.

Dan MacGuill (dan.macguill@thelocal.com)

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