The 27 European countries agreed on Tuesday to reform the European electricity market with new rules to stabilize prices. Certain oppositions remained strong between France and Germany.
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This agreement, obtained on Tuesday October 17, makes it possible to decorrelate the prices of electricity from those of gas, the system in force until now, which is highly contested. Then, it makes it possible to strengthen the competitiveness of European industry in the face of international competition, particularly from the United States and their cheap fossil fuels. The Twenty-seven agreed, only Hungary voted against.
The compromise found, which must now be refined at the political level, makes it possible to smooth out the impact of the volatility of gas prices on the price of our electrical energy thanks to long-term contracts. If electricity prices fall below a defined range, states will compensate the producer. If prices rise and pass above the said range, the energy producer will transfer the additional revenues earned to the states. States will thus have additional revenue that they can redistribute to consumers to reduce their bills at the end of the month.
Which also makes it possible, and this is the second point, to strengthen the competitiveness of European companies. Thanks to this system based on what we call “Contracts for difference” (CFD), the final prices will reflect the real costs of electricity production in each country, which will give visibility to producers in particular to predict the heavy investments intended to ensure the energy transition.
Real progress between France and Germany
Until now, Berlin was opposed to these “Contracts for Difference” applying to nuclear energy. The German government believed that French electricity from nuclear sources, which was much cheaper, constituted an unfair advantage. Germany, it must be remembered, has chosen to abandon nuclear power in its electricity production. Berlin finally agreed to make a comeback by relying on Brussels to control the system very closely.
A victory for the Minister of Energy Transition, Agnès Pannier-Runacher, who negotiated for many months. And quite simply a victory for France in an issue which was far from won: atom joins renewables in the new European ambitions.