Will the tariff shield prevent a 120% increase in electricity prices in 2023, as claimed by the govt?
Tariff is the miracle weapon in opposition to rising electricity prices? On the event of the inauguration of the offshore wind farm in Saint-Nazaire, on Thursday, September 22, Emmanuel Macron returned to the authorities’s technique to prevent the increase in power prices: “Prices have gone loopy (…) In this case, now we have reacted with a tariff shield.” with out a shield, “That’s a 120% increase in what we’ll have.” In 2023, in opposition to inflation of 15% with this technique, confirmed the President of the Republic. Franceinfo verified this assumption.
To perceive how the govt arrived at this determine, we should calculate the electricity tariffs regulated in France. Defined by public authorities and supplied by accountable operators such as EDF, this regulated tariff is partly linked to fluctuations in the market value of electricity. A limitation imposed by regulation on the new group (Nome) of the electricity market as a part of EDF’s full opening to competitors.
To compensate for the advantages supplied by its nuclear fleet, the Nome regulation obliges the public electrician to replicate the provide prices borne by its rivals, when the latter provide the wholesale electricity market. The intention is to allow EDF’s rivals to supply aggressive prices. Obviously, in order to not penalize competitors, if the tariffs of different operators increase as a consequence of power value will increase in the electricity market, EDF should elevate its regulated tariffs.
In instances of power disaster, this sensitivity of regulated tariffs to market modifications may cause prices to rise dramatically. According to the Commission for Energy Regulation (CRE), given the increase in the wholesale value of electricity, the regulated tariff would have elevated by over 35% on February 1, 2022 had it not been lined by the first tariff shield launched. by the authorities, which restricted development to 4%.
The safety supplied by the tariff shield will due to this fact be higher in 2023, in response to the authorities “Without authorities motion, electricity tariffs for households will multiply by (…) 2.2 at the starting of subsequent yr”, Elizabeth Bourne speculated throughout a September 14 press convention. “15%” [de hausse] Instead of 120%, that is our dedication”The Prime Minister added on this event. The shield of 2023, assured Matignon’s mercenary, would save the French “180 euros per 30 days” on their electricity payments.
Govt “The boat is a little heavy.” stated Jacques Persebois, director of the Center for Research in Economics and Energy Law (CREDEN). Economists contemplate that with out a slope, the regulated value increase can be fairly 63%. Nicholas Goldberg, a advisor at Columbus Consulting, interviewed by TF1, places the increase at between 70 and 80%.
How to elucidate this discrepancy with the figures put ahead by the govt? Matignon’s account “purely theoretical”According to Jacques Percebois, the motive is the Energy Regulation Commission, which units regulated tariffs “I’ll wait till the finish of December to determine it out.”. And for good motive, the regulated value is calculated from two totally different knowledge. On the one hand, the 24-month common “spot value” is established day by day in the electricity market by inventory exchanges. On the different hand, the ahead value, i.e. the anticipated value of electricity for a future interval in the final two months of the yr. “However, knowledge from September to December shouldn’t be but identified.”Energy consultants level out.
For its calculation, the authorities needed to estimate a wholesale value “actually large”, says Jacques Persebois. This value will exceed 500 euros per megawatt hour. A stage equal to the ahead value of electricity for 2023 noticed in the second week of September 2022. However, this determine doesn’t keep in mind the smoothed common of the “spot value” over two years, as supplied by the CRE, to essentially decide the decrease regulated tariff.
The estimate given by the authorities appears extra dangerous as the guidelines for calculating the regulated responsibility for 2023 haven’t been totally mounted. The ratio of electricity prices relative to the marketplace for the 2023 tariff shouldn’t be but identified, warned Orian de Maupueu, co-founder of Selectra, which compares power affords. CRE additionally launched, on Friday 23 September, a public session geared toward the evaluate “Method of Construction of Regulated Tariffs for Sale of Electricity”. Asked by franceinfo, CRE confirms that it can not “Don’t touch upon authorities statistics”, as a result of they don’t seem to be related to power regulatory our bodies. For its half, Matignon didn’t reply to our request for details about its methodology.
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