The increase in electric bills

The increase in electricity bills for communities requires both a reform of wholesale markets (those of suppliers and producers) and retail markets (which set prices for consumers). If local elected officials do not necessarily have a hand, their representatives are ready to step up. Focus on the solutions considered.

Whether we are talking about climate commitment or balanced budgets, doing everything to limit energy consumption is essential. But what are the avenues that would allow us to return to more reasonable electricity prices, in line with the real costs borne by producers?

The one favored by the executive is… European. On Tuesday, September 5, the President of the Republic denounced "extremely significant speculative phenomena" in the wholesale electricity markets. Its proposals: develop the group purchase of gas at the European level (which remains the main factor in electricity prices,  and strengthen Franco-German solidarity. This winter, Paris will supply part of the gas that Germany can no longer buy from Russia… which will be used in part to produce the electricity that France will need.

 

At the same time, even if we avoid talking about a tax on super-profits, a European mechanism could see the light of day to involve energy operators "whose production costs are much lower than the selling price on the market", said Emmanuel Macron. What then finance national support measures?

 

Finally, most Europeans agree that the electricity market will need to be reformed more deeply. At an extraordinary meeting of EU energy ministers, the Czech Presidency will present the various options on the table on Friday 9 September. Starting with a temporary exclusion from the markets for electricity produced from gas. Many observers estimate that it will take months for the twenty-seven to agree on a text. Meanwhile, the problem persists.

 

Whatever efforts are made to control the wholesale market, prices will also remain high. At least as long as the energy situation is tense, that is to say, it is difficult to obtain gas supplies, and that half of the French nuclear power plants are shut down. On Monday, September 5, the government wanted to be reassuring about their ability to restart by February… an announcement that had no repercussions on markets that were doubtful, to say the least.

The other challenge is therefore to provide consumers (in the retail market) with appropriate assistance. The 2023 budget will be an opportunity to redefine the outlines of the tariff shield that protects residential customers and businesses, but local authorities are still waiting for appropriate support mechanisms. To date, only those who employ less than ten agents can benefit from regulated sales tariffs (TRV). Others have to put out bids and cross their fingers for answers. All the testimonies point to an explosion in the prices charged

To limit damage, the law of August 16, 2022, for the protection of purchasing power promised the publication by February 2023 of “a report assessing the level of exposure of local authorities and their groups (…) and the advisability of reinforcing the fiscal, budgetary and tariff measures [already] taken”. Do communities really have the means to wait? "It does not seem realistic to us," said Lionel Guy, head of the service at the FNCCR. “10% of urban areas are considering a partial or total closure of at least one of their swimming pools this winter, we illustrate at Urban France. A heartbreaker”.

As two important pieces of legislation loom – the Finance Bill and the Renewable Energies Acceleration Bill – there is no doubt that alternative proposals will come back to the table. And that's good because there is no shortage of ideas from associations, from bringing TRVs up to date to the introduction of a tariff shield tailored for public services, including adapting the Energy Code so that local authorities can sign long-term purchase contracts.